Q3 Trading Update
13/02/2025 12:27
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RNS Number : 0449X Renewi PLC 13 February 2025
13 February 2025
Renewi plc
Q3 Trading Update
Renewi plc ("Renewi" or the "Group") (LSE: RWI.L: Euronext Amsterdam: RWI.AS),
a leading European waste-to-product company, provides the following trading
update for the nine months ending 31 December 2024 ("Q3").
Financial Highlights 1
· Revenue from continuing operations: €1,307.8m, 4.2%
year-on-year growth against a backdrop of continuing regional economic
sluggishness, supported by higher volumes in Specialities and higher inbound
prices in Commercial Waste (FY24: €1,254.8m).
· Underlying EBIT from continuing operations: €77.6m, 8.4% higher
year-on-year with a strong contribution from Mineralz & Water and
Specialities, together with lower SG&A costs.
· Core net debt 2 to EBITDA of 2.87x in line with expectations, up
from 2.14x in March 2024 driven by the financing of the disposal of the UK
Municipal business, with core net debt at €507.2m (March 2024: €368.1m).
The Group continues to expect to deleverage by 0.4-0.5x per annum to 2x over
the medium term.
· Completion of UK Municipal: On 10 October 2024 the Group
announced the successful completion of the sale of its UK Municipal operations
to Biffa Limited.
Q3 FY25 performance
Commercial waste showed revenue growth, with higher prices offsetting lower
volumes, though margin expansion was slower than expected due to customer mix
and lower recyclate prices. Incineration capacity issues were resolved in the
third quarter but contributed to higher cost of waste over the year-to-date
period. The construction sector in the Netherlands returned to growth towards
the end of the period, having been in decline through most of 2024. Due to the
Group's strong footprint in both Belgium and the Netherlands, Renewi won a
major waste management contract with one of the world's largest dairy
companies FrieslandCampina in both countries. Over the period, Renewi also
expanded its Green Collective partnership which now includes the larger
Rotterdam area. With operations spanning more than 30 municipalities, Green
Collective is actively reducing truck mileage, lowering CO2 emissions and
enhancing safety in urban areas.
Mineralz & Water continued to deliver a strong operational performance
from waterside operations bolstered by a favorable product mix. In addition,
the contaminated soil treatment combined with new offtake contracts for
Forz®Sand-T help ensure long-term business stability.
Specialities revenue growth remained strong, though EBIT was impacted by lower
recyclate prices and lower volumes over the period. During the period, Renewi
invested in PVB (polyvinyl butyral) recycling at its site in glass recycling
site in Lommel, Belgium. PVB is commonly used in laminated glass for
automobile windshields. By investing in its recycling, Maltha is providing a
more sustainable solution for a stream that until now has generally been
destined for landfill - an important opportunity to further drive the circular
economy.
The One Renewi initiative was also launched during the period, focusing on
enhancing the Group's logistics and processing capabilities, as well as
driving standardisation across Renewi. SG&A costs were lower year-on-year
as a result of the successful implementation of the "Simplify" programme. This
programme has been fully implemented and related cost savings have now reached
run-rate.
Outlook
Whilst market conditions remain mixed, the benefits of the Group's commercial
and cost initiatives underpin the continued expectation of solid progress in
FY25. We enter the final quarter with positive growth momentum which should
enable the Group to achieve a full year revenue performance in line with its
previous expectations. Further productivity and cost initiatives are being
implemented to mitigate, in part, the effect of the additional cost and market
headwinds experienced in Q3, which are anticipated to persist in the remainder
of the year. Looking ahead, Renewi remains committed to delivering on its
medium-term targets of a high-single digit underlying EBIT margin and organic
annual revenue growth of >5%*.
*The statement on medium-term targets is a 3 to 5 year target and is
aspirational only. As such, the statement should not be construed as a profit
forecast within the meaning of the Code. There can be no certainty that Renewi
will achieve its ambition, which is subject to various assumptions, risks and
uncertainties which could cause Renewi's financial results to differ
materially from these targets.
For further information:
Renewi plc FTI Consulting
Anne Metz, Director of Investor Relations Richard Mountain / Ben Fletcher
+31 6 4167 9233 +44 203 727 1340
investor.relations@renewi.com (mailto:investor.relations@renewi.com) renewi@fticonsulting.com (mailto:renewi@fticonsulting.com)
About Renewi
Renewi is a pure-play recycling company that focuses on extracting value from
waste and used materials rather than disposing of them through incineration or
landfill. The Company plays an important role in combating resource scarcity
by creating circular materials. In giving new life to used materials, Renewi
addresses both social and regulatory trends, contributing to a cleaner and
greener world.
Our vision is to be the leading waste-to-product company in the world's most
advanced circular economies, reflected in a recycling rate of continuing
operations of 66.2%, one of the highest in Europe. In FY24, Renewi puts 6.6
million tonnes of low-carbon circular materials back into use each year. This
contributes to mitigating climate change and promotes the circular economy.
Our recycling efforts help to protect natural resources and prevent more than
2.5 million tonnes of CO2 emissions annually.
Renewi leverages innovation and the latest technology to turn waste into
circular materials such as paper, metals, plastics, glass, wood, building
materials, compost, and water. We employ over 6,000 people across 151
operational sites in five countries in Europe. Renewi is recognised as a
leading waste-to-product company in the Benelux region and a European leader
in advanced recycling.
Visit our website for more information: www.renewi.com (http://www.renewi.com)
.
Cautionary note regarding forward looking statements
This announcement contains certain statements which are, or may be deemed to
be, forward looking statements with respect to the expectations and plans,
strategy, management objectives, future developments and performance, costs,
revenues and other trend information of Renewi. These forward looking
statements can be identified by the fact that they do not relate to historical
or current facts. Forward looking statements often use words such as
"anticipate", "target", "expect", "estimate", "intend", "plan", "goal",
"believe", "will", "may", "should", "would", "could" or other words of similar
meaning. These statements are based on assumptions and assessments made by the
Renewi board, in the light of its experience and its perception of historical
trends, current conditions, expected future developments and other factors it
believes appropriate. By their nature, forward looking statements involve risk
and uncertainty and the factors described in the context of such forward
looking statements in this announcement could cause actual results and
developments to differ materially from those expressed in or implied by such
forward looking statements.
Should one or more of these risks or uncertainties materialise, or should
underlying assumptions prove incorrect, actual results may vary materially
from those described in this announcement. Except as required by applicable
law and/or regulation Renewi does not assume any obligation to update or
correct the information contained in this announcement.
1 UK Municipal business is shown throughout as an asset held for sale and
a discontinued operation. Numbers are presented on a continuing basis and
comparatives have been restated
2 Core net debt used for banking leverage calculations excludes the impact
of IFRS 16 lease liabilities and UK PPP net debt
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