In its 2018 annual results, published this morning (27 February), Suez, which has operations in the UK via Suez Recycling and Recovery UK, has reported an 11.5% growth in earnings before interest and taxes, after recording a “strong year”.
The results also highlight the award of contracts to the company in both Manchester and Devon in the last 12 months, as evidence of its strong position in the market.
The company’s annual report for the 2018 calendar year showed that overall revenues across the global business jumped to €17.3 billion (£14.8 billion), up from around £13.6 billion at the end of the previous year.
For recycling and recovery, the report show that revenue rose by 2.7% (+£142m), bolstered by higher volumes of treated waste.
Performance in waste was driven by a 2.4% increase in waste volumes treated, higher prices, “primarily in the services activities”, and by a “strong commercial dynamism”.
It was, however, affected by the adverse trend in prices of recycled raw materials, “notably paper and cardboard”, in light of China’s decision to significantly reduce its imports.
This was “partially offset by positive energy prices (7.5 Tw/h energy sold in 2018)”, the company added.
UK market
For the UK specifically, organic growth was put at 0.6%. “The higher level of activity in the industrial and commercial segment, and higher prices in some of the services activities, offset the negative impacts of the price trend in recycled raw materials, the lower contribution from construction activities, and the closure of the Tilbury treatment site in the United Kingdom at end-2017,” Suez said in its report.
Suez added that throughout Europe, the group “strengthened its presence” in all of its markets. This included being awarded the contract by Devon county council to “build a transfer centre and process its waste” for approximately £60m over 10 years in January 2018 (see letsrecycle.com story).
The company was also named last week, as the preferred bidder for the Greater Manchester waste contract – seen as a major boost to Suez due to the scale of the deal (see letsrecycle.com story). This was cited as further evidence of the group “strengthening its position” in the UK market.
As outlined below. with regards to the treatment of UK waste, the results show that 19% of this was landfilled, 36% incinerated, 27% recycled and 17% composted.
Targets
Commenting on the 2018 results, Suez chief executive Jean-Louis Chaussade, said: “The Group had a strong year in 2018, exceeding the revenue, EBIT and free cash flow targets set at the beginning of the year.”
“All divisions contributed to this excellent growth trend, with WTS and International performing particularly well. Suez’s profitability also improved in 2018, despite headwinds from the sharp drop in the price of certain recycled raw materials and the rise in oil prices.”
Jean-Louis Chaussade
Suez
Mr Chaussade added: “All divisions contributed to this excellent growth trend, with WTS and International performing particularly well. Suez’s profitability also improved in 2018, despite headwinds from the sharp drop in the price of certain recycled raw materials and the rise in oil prices. The commercial results reported by each division demonstrate our ability to maintain profitable growth momentum for the Group.”
Meanwhile, Suez also announced changes at board level, with Mr Chaussade having been unanimously voted as chairman of the company’s board of directors, effective May 14, succeeding the current chairman Gérard Mestrallet.
Bertrand Camus will take over as chief executive on the same date – a move that was announced in December.
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