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Renewi Reports Earnings Growth and Advances Plastic Recycling Initiatives
Renewi PLC (LSE:RWI), a waste management company based in Milton Keynes, England, has reported an increase in underlying earnings before interest, tax, depreciation, and amortization (EBITDA) for its financial first quarter ending June 30. The company’s EBITDA rose by 2.8%, reaching €22.3 million compared to €21.7 million in the same period last year. Revenue for the quarter also saw a 3.0% increase, growing from €421.7 million to €434.4 million. This growth was attributed to new contract wins in the small-to-medium enterprise segment, which helped offset mixed market conditions.
Increase in Core Net Debt
Renewi’s core net debt rose by 17% during the quarter, reaching €430.8 million, up from €368.1 million at the end of March. The increase in debt was primarily due to seasonal working capital requirements.
Portfolio Optimization and Strategic Moves
In May, Renewi completed the sale of its UK Municipal business to Biffa Ltd, aligning with its portfolio optimization strategy. The sales are progressing as planned and are expected to be finalized on schedule. Additionally, Renewi has formed a new partnership with Freepoint Eco-Systems Ltd, a provider of advanced plastic recycling solutions based in Connecticut. This collaboration aims to develop infrastructure for sorting and treating end-of-life plastics, reducing reliance on incineration.
Focus on Plastic Recycling
Through the partnership with Freepoint, Renewi plans to supply up to 80,000 tonnes of feedstock to Freepoint’s first European advanced recycling facility in Ghent, Belgium. This initiative is part of Renewi’s broader strategy to enhance its recycling capabilities and contribute to more sustainable waste management solutions.
Strategic Objectives and Future Outlook
Chief Executive Officer Otto de Bont highlighted the continued progress on Renewi’s strategic objectives, including portfolio optimization and organic growth. The company’s ‘simplify’ program is contributing to improved performance and efficiency. For the fiscal year 2025, Renewi’s outlook remains unchanged, with expectations for full-year revenue growth and margin improvement. The company aims to achieve up to 5% organic growth in the medium term.
Renewi’s recent financial performance demonstrates an upward trend in earnings and revenue, supported by strategic actions such as the sale of its UK Municipal business and the new partnership for plastic recycling. The company is positioned to benefit from its ongoing initiatives and is maintaining a steady outlook for the future.
