Financial results show ‘successful’ year for Biffa
Waste management company Biffa’s financial results for 2019/20 have revealed an increase in its underlying operating profits of 10.8 per cent, putting it in a “strong position” to withstand the impacts of the Covid-19 pandemic.
Released today (5 June), the Biffa Group revealed its underlying operating profits had increased by £8.8 million to £90.5 million, while its underlying profits before tax increased by 12.1 per cent to £71.7 million.
The company’s increase in profits has been driven by a strong performance in its recycling and waste collections operations. Strong performance has also been recorded in its Industrial and Commercial (I&C) and Specialist Services operations and recycling activities, while its operations in Inerts, Organics, Municipal and Landfill Gas remain solid.
The Group’s net revenue has increased by seven per cent to £1,102.8 million, up from £1,030.8 million in 2018/19. This represents a greater increase in revenue to 2018/19, which saw a growth of 4.4 per cent.
The Covid-19 pandemic has caused great disruption to recycling and waste services due to the government implementing lockdown and social distancing measures. Despite strong performance over the financial year, Biffa’s I&C and landfill businesses have seen revenues fall by 50 per cent, though they have begun to recover to 40 per cent down.
Biffa has taken swift action to protect the health of employees and communities, ensure business operations are able to continue with minimal disruption and protect the financial strength of the Group. As a result of Biffa’s cash conservation package of measures, no financial dividend will be paid to shareholders for this financial year.
Commenting on the financial results, Michael Topham, Chief Executive of Biffa, said: “Events since March have, for obvious reasons, completely overshadowed what was otherwise a very successful year for Biffa. We delivered a strong set of financial results, continued to execute our exciting growth strategy, and committed to an ambitious 10-year Sustainability Strategy, ‘Resourceful, Responsible’ which will see the Group unlock £1.25 billion of investment in green economy infrastructure by 2030.
“We continued to make good progress in our I&C business, through a combination of organic growth, a number of acquisitions and a standout performance in our Specialist Services business. The Municipal business stabilised with some excellent new business wins and contract extensions. In Resources and Energy, a strong performance in our Biffa Polymers business offset some weakness in the recycling facilities that arose from ongoing softness in commodity prices.
“Whilst the Covid-19 pandemic has brought unprecedented challenges, I am very proud of the way Biffa has responded with a series of swift and decisive measures focused on protecting our people, continuing to serve our customers and maintaining our financial strength. Proactive steps to conserve cash have included temporarily suspending M&A activity and dividends; reducing capex, operating costs, pay and bonuses; utilising government assistance where appropriate and securing the necessary support from our lenders and suppliers.
“These actions have placed us in a strong position to withstand the immediate impact of the crisis as we continue to provide critical and sustainable infrastructure and services.
“I would like to offer my thanks and appreciation to all of Biffa’s stakeholders, in particular our employees, for their exceptional response to the Covid-19 crisis. Although the crisis will continue to be tough for everyone and the short-term outlook remains uncertain, we are confident that the measures we have taken ensure we are able to be clearly focused on making sure Biffa emerges a stronger and better business.”