Cleanaway appoints new CFO

Cleanaway Waste Management has announced the appointment of Paul Binfield as Chief Financial Officer, following the retirement of Brendan Gill.

Gill joined Cleanaway as CFO in late 2014, and according to an ASX statement, leaves the company with a healthy balance sheet.

“His focus on getting the company through the legacy landfill remediation issues will be accretive to our cash flows in years to come,” the statement reads.

Binfield, who currently serves as CFO of Nufarm Limited, will take over the role from February 2021.

Cleanaway CEO and Managing Director Vik Bansal said while he is disappointed Gill made the decision to retire, he is excited for Binfield to join the company.

“I look forward to his leadership and contribution as we embark on phase two of our Footprint 2025 strategy,” Bansal said.

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Cleanaway forecast remains in line with FY20 earnings guidance

In a statement to the ASX in March, Cleanaway assured stakeholders it has not seen any material change in volumes across any of its operating segments to date.

Cleanaway’s current financial performance for FY20 remains in line with its internal forecasts and FY20 earnings guidance, it said. However, the impact of COVID-19 means Cleanaway considered it prudent to suspend its earning guidance.

Cleanaway Managing Director Vik Bansal said the company has not observed any decline in overall trading in any of its operating segments to date.

He said that however, as the COVID-19 situation evolves, Cleanaway expect the SME part of its C&I waste volumes to be impacted.

“At this stage, we expect the demand for other services, such as health, municipal collections and related post-collections services to remain strong,” Mr Bansal said.

“Cleanaway provides a range of essential services to a diverse customer base which includes municipal councils, government infrastructure, hospitals, resources, manufacturing, commercial and industrial customers.

“We are taking measures to help ensure the safety and welfare of our employees and customers and we remain confident in the resilience of our business.”

Following the collapse of SKM Recycling Group, Cleanaway Waste Management acquired the senior secured debt in the group for around $60 million, with the exception of its glass recovery services business. This includes the property, plant and equipment from a network of five recycling sites, comprising three materials recovery facilities (MRFs), a transfer station in Victoria and a MRF in Tasmania. SKM also has two sites in South Australia.

Cleanaway’s Footprint 2025 strategy went from strength to strength as Cleanaway in October announced a joint venture with Macquarie Capital’s Green Investment Group to develop a waste-to-energy (WtE) project in Western Sydney.

Cleanaway opens new Melbourne depot

Cleanaway CEO Vik Bansal has officially opened the company’s new Perry Road Office and Collections Depot in Dandenong South.

The 53,000 square meter depot will house Cleanaway’s business and operational teams including the Victoria Post Collections leadership team, the commercial, industrial and municipal collections’ business, sales, administration, finance and fleet teams.

According to a Cleanaway news statement, the site features a 20-bay workshop facility designed for vehicle compliance and fleet productivity, with paved parking areas for 164 collection vehicles and the new electric vehicle fleet.

“The site is also equipped with fuelling stations with 100,000 litre capacity and automatic truck and parts washing bays,” the statement reads.

“Bringing together our administrative and operational teams from across Greater Melbourne is a key step forward to serving our customers better and making a sustainable future possible for communities across Australia.”

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Cleanaway trials electric waste collection vehicles

The first of two fully electric Cleanaway waste collections vehicles have begun kerbside collections in Victoria as part of a three-month trial.

The first vehicle began servicing household collections in Hobsons Bay. City of Greater Geelong and Moonee Valley will also host the vehicle to ensure it is tested across a variety of terrain and in different municipal settings.

Cleanaway CEO Vik Bansal said the vehicles are among the first in Australia to service kerbside collections, and will be under pressure to carry full loads and complete scheduled runs every day.

“With almost 5000 vehicles on the road each day, servicing homes and businesses all over Australia, we are looking for ways to do that more sustainably while continuing to deliver consistent service,” Mr Bansal said.

“Sustainability is about more than removing emissions at all costs. If service levels drop or waste collection costs increase significantly for ratepayers – that isn’t sustainable.”

Cleanaway Head of Fleet Paul Young said the company is optimistic about proving the reliability of the technology.

“The trial is designed to encourage fast learning so the electric vehicles can continue operating once the trial has ended, allowing Cleanaway to introduce more electric and combination fuel vehicles to the permanent fleet,” Mr Young said.

“With zero emissions, the vehicles are expected to run for 180-200 kilometres before needing to recharge. The brakes also regenerate – reducing repair and maintenance costs and the consumption of other parts like brake pads.”

According to Mr Young, the vehicles significantly reduce noise, making early morning or late-night collections possible for some waste streams.

Hobsons Bay Mayor Jonathon Marsden said the trial complements the great work already happening in the sustainable transport realm.

“These initiatives support our key priorities in the Hobsons Bay 2030 Community Vision of exploring sustainable practices and growth through innovation, technology, job creation and education,” Mr Marsden said.

“It’s also a step in the right direction of council’s draft Waste and Litter Management Strategy 2025 to trial alternative fuels in the waste, recycling and litter collection fleet.”

The vehicles were commissioned by Cleanaway in conjunction with SEA Electric and Superior Pak and are not yet in mass production.

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Cleanaway releases FY19 half-year results

Cleanaway has announced its financial results for the six months ending 31 December, reporting the integration of Toxfree is on track and all operating segments increased revenue and earnings.

An ASX statement shows gross revenue increased by 46.4 per cent to just over $1.7 million, with net revenue increasing by 47.4 per cent to just over $1.6 million.

Earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 43 per cent to $221 million.

The company’s solid waste services reported net revenue increases by 30 per cent to $682 million, with EBITDA growing by 26 per cent to $176 million. Growth was reportedly enhanced by the ramp up of major contract wins such as the NSW Central Coast, Coles, NSW Container Deposit Scheme and commencement of a Brisbane City Council resource recovery contract.

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Cleanaway’s industrial and waste services reported increased net revenue, earnings and margins, with net revenue increasing by 129 per cent to $177 million. EBITDA increased 194 per cent to $23.2 million. The company said modest organic growth occurred taking into account the completion of the Toxfree Wheatstone project.

The acquisition of Toxfree has increased scale in this segment, allowing for segementation and management across two strategic business: resources and infrastructure.

The statement said that the pipeline of work across both infrastructure and resources markets is encouraging, although at this stage it is too early to be confident on the timing of project commencements.

The liquid and health services segment saw net revenue increase by 77 per cent to $251 million and EBITDA by 93.2 per cent to $42.7 million.

“Hydrocarbons had a good first half and remains on track for further growth with increased production efficiencies and improved oil price movement,” the ASX statement read.

“Hazardous and non-hazardous liquids performance was disappointing. We are working to improve its performance and remain confident that this will be achieved.”

An interim dividend of 1.65 cents per cent has been declared representing an increase of 50 per cent over the corresponding period.

Positive earnings momentum is expected for the remainder of the year via organic growth and full realisation of synergies.

Cleanaway Chief Executive Officer Vik Bansal said he was pleased to present results that deliver on the company’s promise and commitments.

“The safety of everyone at Cleanaway has and always will be our number one priority. The alignment of culture and behaviours needed to ensure our target of Goal Zero remains a priority as we continue the integration of Toxfree,” he said.

“We are pleased with the Toxfree integration process and remain confident of delivering the $35 million of synergies from the acquisition.”

Mr Bansal said that while margins have improved compared to the second half of FY18, the company believes that further improvements can be achieved as it continues to implement synergies and operational improvements across all segments and businesses.

“Development of our prized infrastructure as part of Footptint 2025 continued at pace. During the half we completed construction of post collection facilities in Sydney and Perth, an organics facility in Melbourne and upgraded our soil treatment facility in Sydney,” he said.

“The acquisition of Toxfree and the numerous strategic initiatives which we continue to implement across the company have further strengthened our position as the leading waste management company in Australia.”

Cleanaway unveils new optical container sorting facility

Cleanaway has officially opened its new automated optical Container Sorting Facility at Eastern Creek, NSW.

The facility initially opened on 1 December 2017 and included a manual sorting line, which used magnetic sorting and manual picking to separate steel, aluminium, cartons and plastics with a capacity of 1.5 tonnes per hour.

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With construction of the new automated sorting line completed, the facility now has a capacity of eight tonnes per hour.

Optical sorters used in the plant identify containers based on their material type at thousands of reads per minute with air jets being used to separate them for compaction and baling.

These baled materials are then distributed domestically and internationally to be recycled back into food grade containers.

Since beginning operation last year, the facility has processed most of the 900 million containers collected by the NSW Return and Earn scheme.

The NSW Government’s scheme aims to reduce the volume of litter across the state by providing a 10-cent refund for each eligible container returned.

Cleanaway CEO and Managing Director Vik Bansal said schemes such as Return and Earn require the community to pre-sort containers for recycling, reducing the level of contamination at the source.

“With the new sorting technology installed at this facility, we are now able to improve the quality of the commodity streams even further,” Mr Bansal said.

“The Eastern Creek Container Sorting Facility is a critical part of our Footprint 2025. We’re committed to putting the infrastructure and facilities in place to deal sustainably with Australia’s waste, well into the future.”

Mr Bansal says the challenges facing the waste industry over the past 12 months have changed the way Australians view waste.

“It is more important than ever before that we work together to address these challenges. Return and Earn is a great example of that,” he said.

“It has been encouraging to see so many people getting involved and increasing the amount of recyclables being sorted at the source.

Coupled with a better network of facilities to sort the containers collected, we can produce commodity streams which are in demand, meaning more items are being recycled into new products,” Mr Bansal said.

NSW Environment Minister Gabrielle Upton said the Return and Earn had been a great success, reducing litter across NSW by a third.

“I commend the people of NSW and congratulate Cleanaway on their state of the art facility that supports Return and Earn to provide a smart solution to reduce litter in NSW and contribute to a more sustainable future,” Ms Upton said.

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