This comes despite the company today (24 May) posting a loss of €9.2 million (£7.9 million) on its UK municipal contracts in its 2021/22 financial results, down from £16.5 million last year.
The company attributes this to “an improved operational performance driven by volumes and continuous improvement initiatives, as well as benefits from higher recyclate prices.”
Renewi currently runs six municipal contracts in the UK, which are with Argyll and Bute, Barnsley Doncaster and Rotherham, Cumbria, East London, Elstow and Wakefield.
The report said that the company’s UK contracts saw “the benefits of high recyclate prices offset by higher council volumes, an accounting adjustment in one contract and €2m costs relating to a fire at one of our facilities in Cumbria with insurance recovery possible in the next financial year”.
Scope
Renewi, formed when Shanks merged with Van Gansewinkel in 2017, explained that it has a two-stage strategy for international expansion.
In the immediate term there are “opportunities to expand in niche waste segments” for commercial customers, such as white goods, mattresses and glass.
In the long term Renewi said it belies its model “can be replicated in other advanced circular economies”.
The company created the “Renewi Advanced Circular Economy” (RACE) index of all European countries, assessing their “suitability” based on factors such as material recycling rate, use of secondary materials, regulation, and taxonomy related to material usage.
The RACE index “further allows us to focus on a number of countries, including Denmark, Sweden, Germany, and the UK, where we see scope for successful and profitable expansion in the long-term”.
Contracts
The results added that UK municipal contracts continue to be loss-making, but said there have been underlying improvements with the ELWA contract, due to expire in five years time.
Elsewhere, the company’s contract to manage Derby council’s waste is planned to remain in place through the second half of 2022 under short term contracts “pending the council’s long-term plans”.
Despite its loss in the UK, the company reported a 10% increase in overall revenue in 2022 compared to 2021, at £1.6 billion. Group profits also rose by 122% to £100 million.
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