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Renewi PLC on Wednesday said revenue in the first half fell due to weak demand, in particular in the Netherlands, which is expected to be largely offset by price increases. The Milton Keynes-based company that turns waste into high-quality recycled products said it expects performance for the financial year to March 31 to be in line with its own expectations. Renewi said that revenue and underlying earnings before interest and tax were down in the first half of 2023 due to a ‘normalisation of recyclate prices from the exceptionally high levels in the early part of the last financial year’. It added that prices have now stabilised at lower levels, with the majority of the decline, and ongoing inflationary pressures, to be offset by price increases and margin benefits from the company’s 2.0 digitisation programme. The company said: ‘Within commercial waste, volumes stabilised in Belgium, but saw a continued decline in the Netherlands during Q2 given ongoing demand weakness in particular from construction and demolition customers. In response, the company is implementing a series of divisional and central cost measures that are expected to largely offset the impact of lower volumes.’ Over the medium term, Renewi targets organic revenue growth of over 5% annually, a high single digit Ebit margin, free cash flow generation of at least 40% of earnings before interest, tax, depreciation and amortisation and return on capital employed of over 15%, compared to 10.6% in financial 2023. Renewi shares were 0.6% lower at 718.48 pence each on Wednesday morning in London. Copyright 2023 Alliance News Ltd. All Rights Reserved.
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