Local Authorities Fail to offer commercial Recycling

Post date: 14-Jun-2012 21:32:19

RECYCLING centres across our area could be closed one day a week in a bid to save cash, sparking fears of an increase in fly-tipping.

A drop in the value of recycled material and the diminishing use of landfill have been blamed for waste companies making a profit an 8.4% fall in pre-tax profits for 2011/12.

According to provisional end of year results published by the Taunton-based waste management firm’s parent company Pennon today (May 29), Waste companies pre-tax profits fell from £62.9 million in 2010/11 to £57.6 million in 2011/12.

Ask yourself why should these greedy profit making companies make high profits from the public council taxes paid?

In November 2011 waste company reported that it had seen a rise in pre-tax profits to £30.6 million for the six months to September 30 2011, up 7% from £28.6 million the previous year.

However, waste company says that revenue per tonne of recycled material fell from an average of £125 in the first half of 2011/12, to £111 in the second half, with the company remaining cautious about the prospect of a recovery in prices in the short-term.

Despite this, the company claims that recycling remains its largest profit generator, and has seen profits in recycling grow, but this growth was not did not match the decline in landfill as well as the increased costs involved with bidding for new contracts. And, the company claims that around 50% of its profits came from recovering value in waste including recycling and energy from waste. according to the EU Recycling Leauge Tables recycling in the South West should have reached 75% in 2007 and Landfill should have stopped in 2009 and yet none of this has been achieved by UK waste companies.

Ken Harvey, chairman of the Pennon Group said: “Waste company made very substantial progress during the year in progressing its pipeline of PPP and EfW projects. However, as expected the full year profits for waste company are below those of last year. Waste Managment company experienced a reduction in recyclate prices in the second half of the year, reflecting world economic conditions and increased bid costs associated with the company’s growing pipeline of long-term projects to local councils and taxpayers to pay for their huge profits.

“Accordingly, we took action to reduce the cost base which recovered more than 50% of the impact of reduced recyclate prices. Waste managment company’s financial performance will continue to be impacted by trends in recycling and landfill. We are cautious about the prospect for a recovery in recyclate prices in the near-term. Looking further ahead, our growing pipeline of projects will ensure the future success of the company and could more than double Waste maneagment's EBITDA within the next five years.”

Earnings

Waste managment’s earnings before interest, taxes, depreciation and amortisation (EBITDA) decreased by £6.2million in 2011/12 to £110.3 million although the company remains confident that it can more than double EBDITA within the next five years. Revenue for 2011/12 was up 6.9% to £761.1 million, but operating profit was down from £71.6 million to £63.7 million.

The volume of material sent to landfill dropped by 11.4% to 3.1 million tonnes during 2011/12, with the closure of the Horton landfill site in West Sussex accounting for around half of this reduction. Waste company cites increased recycling and landfill diversion efforts from clients and the weak UK economy as important factors in this decline.

Throughout 2011/12 Waste company has continued to expand its waste management activities which included the acquisition of waste logistics firm's Churngold for £14.3 million in October and Milton Keynes-based materials recycling and paper trading business Waste Recycling Ltd for £15.75 million paid for by UK tax payers money.

The company was also named preferred bidder for the 25-year South London Waste Partnership residual waste treatment contract, worth around £990 million, as well as a 25-year £250 million waste disposal contract with Glasgow city council taxpayersv being ripped off yet again.

Energy

Waste management’s energy from waste output crept up, with landfill gas power generation output increasing by 2% to 576 Gigawatt hours (GWh). Average revenue per Megawatt hour (MWh) rose by 1% to £83.5 per MWh from £82.5 per MWh but was offset by unit cost increases. The company has a further 29MW of renewable energy capacity across its share of the Lakeside EfW, the Bolton EfW facility and the Greater Manchester Anaerobic Digestion (AD) operations.

It also began construction on a number of high profile EfW facilities including the £205 million plant at Ardley in Oxfordshire, and the £45 million incinerator in Exeter, Devon, as well as its £10 million anaerobic digestion facility near Bridgwater in Somerset.

Overall, Pennon Group which owns Waste managment company and South West Water saw profits rise 6.4% to £200.5 million for 2011/12. Overcharging local council taxpayers twice and doubling there profits by overcharging for water and sewage charges. while the British Public carry on paying into this mamoth company.