A £7 million investment in sorting and production equipment contributed to a multi-million pound loss for the plastic recycling firm Clean Tech UK Ltd, but the company says performance has since stabilised.
Clean Tech UK, which runs the PET plastic bottle recycling facility at Hemswell in Lincolnshire, disclosed the losses and investment in its 2018 financial year accounts, which were published this week.
Within the accounts, the company said that 2018 had seen it undergoing “a turnaround and integration process into the Plastipak Group.” Plastipak acquired the Hemswell site from German investment company Aurelius in a pre-pack arrangement in 2016.
In total the company posted a total loss of £5.6 million for the year. This follows a £5.7 million loss for 2017. Financial performance stabilised in the final quarter of the year, with the company having broken even during this period, it said.
However, the company claimed that significant growth in market demand is likely to mean a further need for investment in the site.
The company said: “During the year around £7 million has been invested in new sorting and related production equipment which impacted the trading results in the first half of the year but as a consequence of this investment the business broke even in the final quarter of the year.
“Demand for recycled PET is growing rapidly due to the high media interest in recycling plastics and the company is in discussions with many large brands who are seeking to introduce recycled PET into their packaging products. The site at Hemswell is amongst the largest production plants of this type in the country and is thus well-placed to capitalise on this market growth.”
“Demand for recycled PET is growing rapidly”Clean Tech UK
Clean Tech UK operates the flagship 150,000 tonnes per year bottle recycling facility which has the capacity to produce up to 50,000 tonnes per year of rPET flake and food grade pellets for supply to the market.
The company was established in 2016 following the acquisition of the PET plant in a pre-pack arrangement by the US company Plastipak (see letsrecycle.com story).
The site had been formerly run by Eco Plastics, but was sold to German investment firm Aurelius in 2014, after Eco Plastics was placed into administration with debts totalling £14 million.
Coca Cola European Partners is among the major buyers of rPET from the site and invested in the expansion of the plant through a joint venture with Eco Plastics called Continuum Recycling.