Shanks has reported that its profitability has been affected by lower prices for recycled materials over the past year.
While delivering a 14 per cent increase in pre-tax profits to £30.2 million, underlying profits were flat following the sale of Shanks’ loss-making UK solid waste business in the past year.
But the company took a £3 million hit on its profitability as a result of lower prices in its solid waste businesses in Belgium and Netherlands.
In its preliminary results statement, Shanks said: “Recyclate income is another important profit driver for our solid waste business. We have seen greater stability in the last year in pricing for recycled paper and plastics, albeit at a lower level, but metal volumes and prices have continued to fall, directly impacting our profitability by £3 million year on year.”
Shanks will continue with its strategic goals of delivering targeted structural cost reductions, actively managing its business portfolio, selectively investing for growth where it is advantaged, building new infrastructure backed by long-term contracts and maintaining strong capital discipline.
Shanks Group chief executive Peter Dilnot said: “In the last year we have made good progress with our strategic goals and have delivered a robust performance, outperforming the sector in very challenging markets.
“We have increased profit before tax by 14 per cent compared to that reported in 2012/13, driven by our successful exit from UK solid waste. On a like-for-like basis, we delivered a broadly flat profit before tax due to resilient performances from most of our divisions.
“Highlights include investing where we have the clear advantage, actively managing our business portfolio and delivering structural cost reductions. With this platform in place, we have laid the foundations for sustained profitable growth.”
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