Tomra falls amid reports of UK deposit return scheme delay

Tomra Systems ASA

07/07/2023 13:08

** Shares in Norwegian sustainable technology company Tomra
Systems  TOM.OL  fall 4.5% after media speculations over delays
to UK's recycling and deposit return scheme (DRS) plans 
    ** The UK's plans for both extended producer responsibility
(EPR) regulations and its DRS are likely to be "shelved",
British retail industry magazine The Grocer said on Thursday
    ** The current October 2025 launch date for the DRS could
instead be the start of a more limited pilot scheme, the
magazine added
    ** "Given the recent delay in Scotland, which was triggered
by the UK government, this highlights yet another time that DRS
implementations timeliness tend to slide," says ABG Sundal
Collier analyst Daniel Vårdal Haugland in a note
    ** However, the analyst believes that a complete shutdown of
the DRS plan would be improbable and it keeps a "hold"
recommendation on the stock
    ** He believes that the current launch date is "a stretching
target date" and assumes a 2026 launch in the UK 
    ** "A full shutdown could impact shares by ~10% and
potentially weaken growth prospects in new markets," the
analysts adds
    ** The stock is among worst performers on pan-European index
STOXX 600  .STOXX 

 (Reporting By Jesus Calero)
 ((Jesus.calero@thomsonreuters.com))