Renewi Plc (RWI.L), a waste-to-product company, announced on Thursday a fiscal 2024 loss, contrasting with the profit recorded in the previous year, while profit from ongoing operations also fell due to weak revenues.
Additionally, the company confirmed an agreement to sell its UK Municipal operations to Biffa Limited, a comprehensive waste management business in the UK. This transaction will involve a nominal cash consideration paid to Biffa and pre-completion capitalization of the UK Municipal division. Completion is expected before December 31, pending regulatory and other necessary consents.
The divestment is projected to boost Renewi's free cash flow by 15 to 20 million euros annually and lead to an EBIT margin expansion of at least around 50 basis points.
For fiscal 2024, Renewi recorded a loss of 30.9 million euros, compared to a profit of 66.6 million euros the previous year, largely due to lower profits and an extraordinary charge of 64.5 million euros related to the divestment of the UK Municipal operations. Profit from ongoing operations dropped 47 percent to 45.2 million euros from the prior year's 86.0 million euros.
Basic earnings per share from ongoing operations fell to 53 cents from 104 cents per share the previous year. Underlying EBITDA from ongoing operations decreased to 230.2 million pounds from last year's 252.4 million pounds. Revenue from ongoing operations declined slightly by 1 percent to 1.69 billion euros from 1.70 billion euros previously.
The company’s Board is recommending a dividend of 5 pence per share, subject to shareholder approval at the 2024 AGM. If approved, the final dividend will be distributed on July 31, with a record date of June 28.
Looking forward, Renewi anticipates returning to revenue growth and achieving significant margin improvement in fiscal 2025 for the continuing Group, aligning with current market expectations. The company reaffirmed its 3- to 5-year targets of an 8-10 percent underlying EBIT margin and organic annual revenue growth exceeding 5 percent.
