Straight sees positive future in recycling

RECYCLING products and services group Straight said it was confident its record order book would make 2009 a successful year despite seeing full-year profits hit.

Despite revenues increasing for the Leeds-based firm by 8% to £25.4m for the year ended December 31, headline operating profit decreased from £1m to £400,000.

Loss before taxation was £1m compared to a £600,000 profit in 2007, but the group said it had started 2009 with an order book of £8.4m and that trading performance in the first two months of the year has been ahead of forecast.

Straight specialises in supplying products including water butts, compost bins, recycling bins and other garden accessories.

Commenting on the preliminary full year figures James Newman, chairman of Straight, said: “The board is encouraged by its record order book.

“This, combined with the cost reductions achieved as a result of the strategic review, has put the business in excellent shape to capitalise on its unique market position.”

Jonathan Straight, chief executive of Straight, said although the results were “disappointing” the company was in a “fit and lean” position.

Mr Straight said: ‘As a result of the actions we have taken the business which has emerged from 2008 is reinvigorated and is both profitable and cash generative.

“The board is confident that 2009 will prove to be a successful year.”

Straight maintained its cash position at year end of £1.6m and said it would pay a final dividend of 2p, resulting in full year dividend of 3p.

Mr Newman said following a strategic review and restructuring of the business in the fourth quarter, Straight was “in excellent shape and is rising to the opportunities and challenges presented by the current economic climate”.

Straight said the group review has cut overheads considerably. This included an unspecified number of job cuts and writing off stock, which cost about £400,000. The business now employs about 40 staff.
 

Mr Newman said the importance of the group’s trade business to its growth potential was mirrored in revenues increasing by 20% to £23.1m.

This was as a result of demand for newly introduced products, such as food waste collection containers, he said.

Straight is selling products in Australia and North America.

Mr Newman added that the group’s retail business, which sells direct to consumers, had performed poorly with revenues down 53% to £2.3m.

Straight was established in 1993, by Mr Straight, to supply containers for source separated waste.

The company grew to become the UK’s leading supplier of kerbside recycling boxes as well as a key supplier of other types of waste and recycling containers.

Straight joined AIM in 2003 and in 2005 acquired Blackwall, the UK’s largest supplier of home composters and water butts.

Since integrating the two businesses, Straight now provides a wide range of waste and recycling devices to local authorities, the waste industry and general businesses as well as environmental home and garden products directly to end users in partnership with local authorities and utilities.