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Interim Results 2019/20

Renewi Interim Results 2019/20: An interview with Otto de Bont and Toby Woolrych

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    • Solid first half trading in line with expectations
    • Good performance in core Renewi Commercial Divisions, with revenue up 5% and underlying EBIT1 up 13% on a like for like basis
    • Good progress in the Mineralz & Water Division as ATM scales up capacity for manufacture of new building materials and awaits final regulatory approval having successfully completed testing of thermally treated soil stocks
    • Initial deleveraging actions delivered, with strategic disposals of Canada Municipal and Reym for aggregate cash proceeds of up to €118m
    • Planning for next phase of business simplification and efficiency improvements, Renewi 2.0, well underway for implementation following successful delivery of €40m integration synergies by March 2020
    • Executive Committee of Renewi strengthened with four key hires
    • Revenue from total operations up 3% to €926.5m1
    • Underlying EBIT from total operations up 3% to €46.3m1
    • Underlying profit before tax from total operations down 8% to €31.2m1
    • Underlying EPS from total operations down 7% to 2.9 cents per share1
    • Total exceptional items of €60m1, of which 90% (€54m) relates to the strategic disposals mostly non-cash, resulting in a statutory loss of €35.4m for the period
    • On a continuing operations reported basis, revenue up 3% to €916m, loss before tax of €18.8m (2018: €19.3m profit) and basic loss per share of 2.4 cents (2018: earnings 2.4 cents)
    • Strong cash flow performance with underlying free cash flow conversion of 129%
    • Core net debt* reduced to €514m, representing net debt to EBITDA of 2.88x against a covenant of 3.5x which has been extended to December 2021; IFRS 16 debt impact of €165m
    • Interim dividend of 0.45p per share (2018: 0.95p), reflecting previously announced intention for a maintained total dividend of 1.45p for FY20

  • Looking forward, our outlook for the current year is unchanged. We remain focused on cash generation and driving down leverage over time, and we are increasingly confident that ATM will increase production in 2020. While the near-term macroeconomic environment has weakened, the growing circular economy is expected to generate significant opportunities for sustainable growth over the long term.

Business Highlights

  • Solid first half trading in line with expectations
  • Good performance in core Renewi Commercial Divisions, with revenue up 5% and underlying EBIT1 up 13% on a like for like basis
  • Good progress in the Mineralz & Water Division as ATM scales up capacity for manufacture of new building materials and awaits final regulatory approval having successfully completed testing of thermally treated soil stocks
  • Initial deleveraging actions delivered, with strategic disposals of Canada Municipal and Reym for aggregate cash proceeds of up to €118m
  • Planning for next phase of business simplification and efficiency improvements, Renewi 2.0, well underway for implementation following successful delivery of €40m integration synergies by March 2020
  • Executive Committee of Renewi strengthened with four key hires

Financial Summary

  • Revenue from total operations up 3% to €926.5m1
  • Underlying EBIT from total operations up 3% to €46.3m1
  • Underlying profit before tax from total operations down 8% to €31.2m1
  • Underlying EPS from total operations down 7% to 2.9 cents per share1
  • Total exceptional items of €60m1, of which 90% (€54m) relates to the strategic disposals mostly non-cash, resulting in a statutory loss of €35.4m for the period
  • On a continuing operations reported basis, revenue up 3% to €916m, loss before tax of €18.8m (2018: €19.3m profit) and basic loss per share of 2.4 cents (2018: earnings 2.4 cents)
  • Strong cash flow performance with underlying free cash flow conversion of 129%
  • Core net debt* reduced to €514m, representing net debt to EBITDA of 2.88x against a covenant of 3.5x which has been extended to December 2021; IFRS 16 debt impact of €165m
  • Interim dividend of 0.45p per share (2018: 0.95p), reflecting previously announced intention for a maintained total dividend of 1.45p for FY20

Outlook

Looking forward, our outlook for the current year is unchanged. We remain focused on cash generation and driving down leverage over time, and we are increasingly confident that ATM will increase production in 2020. While the near-term macroeconomic environment has weakened, the growing circular economy is expected to generate significant opportunities for sustainable growth over the long term.