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30 Jan 2024 | 08:55

Renewi lowers expectations after challenging third quarter

(Sharecast News) - Waste-to-product company Renewi lowered its full-year expectations in an update on Tuesday, after its performance in the third quarter reflected persisting challenges in some key markets, partly offset by progress in its margin improvement initiatives. The London-listed firm said that in the commercial waste Netherlands segment, volumes, particularly in the construction and demolition sector, remained subdued, mirroring a broader decline in regional construction activity.

It said its ongoing organisational rationalisation under the 'Simplify' programme helped mitigate the impact of lower volumes for the 2024 financial year.

The programme was on track, with around 160 headcount reductions completed in December, resulting in an in-year cost reduction of around €5m.

Recyclate prices remained stable, except for plastics, which experienced continued weakness.

The Mineralz and Water division meanwhile continued to demonstrate positive momentum in the quarter, with notable performance in waterside operations.

On the soil side, the ramp-up initiated in the second quarter continued as expected.

Specialities performed in line with expectations, with Maltha delivering strong results to offset the somewhat lower performance of Coolrec, which was impacted by lower plastic prices.

The UK municipal segment remained stable, delivering a solid performance throughout the quarter ended 31 December.

Renewi noted the securing of new customer wins in the period.

Looking ahead, Renewi noted continued challenges in its trading environment, but said its strategic initiatives had improved performance and reduced costs in the business during the third quarter.

The positive trend was expected to persist for the rest of the year.

However, due to the weaker regional economic conditions, Renewi anticipated that its full-year results would fall below market expectations.

At 0949 GMT, shares in Renewi were down 4.15% at 601p.

Reporting by Josh White for
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