Cleanaway’s results for the 2016 financial year showed revenue and profit were up and debt was down.
Announced on Friday (19 August), Australia’s largest waste management company posted profit after tax of $44.8 million for the year ended 30 June 2016, compared to a statutory loss after tax of $23.6 million for FY15.
Net underlying profit after tax increased 38.5 per cent to $63.3 million compared to the same period last year, after taking out $18.5 million in underlying adjustments for tax. Those adjustments mainly reflect costs around the work following the implementation of Cleanaway’s new operating model, the ongoing process of simplifying the organisational structure, starting the cost reduction program and single branding.
Revenue increased 5.1 per cent to $1,455.1 million against $1,384.9 million for FY15. Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) were $281.3 million, an increase of 21.6 per cent on the previous financial year.
Cleanaway also posted an improved net debt figure of $311.1 million, a drop of $3.6 million from 30 June 2015 and $14.0 million from 31 December 2015.
Cleanaway CEO Vik Bansal said the FY16 performance is a reflection of several restructuring and improvement initiatives implemented across the company in the past 12 months.
“Our focus on customers and service has increased and we are seeing the benefits via the organic growth in our revenues for the first time in a number of years,” he said.
“The streamlining and simplification of the group’s organisational and operating structure has also contributed to this result with a portion of the savings achieved in FY16 being re-invested in a number of market share and revenue growth initiatives. I am confident that our target of a permanent $30 million reduction in our cost base, compared to the cost base in FY15, will be achieved by the target date of 30 June 2017.”
The acquisition of the Melbourne Regional Landfill (MRL) proved a beneficial move for the business, as Cleanaway’s Post Collections business reported increases in both external revenues and earnings for the period, up by 47.6 per cent and 47.0 per cent compared to FY15.
“The establishment of the “Cleanaway Way” which is under-pinned by One Company One Brand, Our Mission, Our Values, Our Operating Model and the strategic focus on Our Five C’s will continue to provide solid foundations for improved performance into the future,” added Mr Bansal.
Looking ahead to the 2017 financial year, Mr Bansal said: “Market conditions are expected to show little change from those experienced during the past year. However, based on the company wide initiatives we are undertaking, both our Solids and Liquids & Industrial Services segments should report increases in operational earnings in FY17.”