UK mobile phone recycling group Redeem Holdings reported a pretax loss of £1.2m for the year to March 2013 on the wake of an aggressive expansion strategy.
The group includes Bathgate-based Redeem, which sets up recycling programmes for mobile network operators and other businesses handling electronic devices, and Environmental Mobile Control, which offers business-to-business recycling and environmental services.
The group posted negative results despite a 10.6% increase in revenues year-on-year to £35.9m. Sales were up slightly in the UK, but grew three times in Europe, from £1.2m in 2012 to £3.6m in 2013.
This followed a strategy of expansion in 12 European countries. Last year Reedem took over the operations in Estonia, Lithuania, Latvia, Finland, Norway and Sweden of other recycler UPR Global through a new venture, Redeem OU.
Redeem also expanded its customer base by winning contracts in North America and the Middle East.
The company said its core markets were undergoing rapid growth as a result of “favourable tailwinds” such as increasing environmental concerns, data privacy issues and the expansion of e-commerce.
However, higher costs negatively impacted the company’s performance leading operating profits to drop into the negative from around £800,000 in 2012.
According to director John Carver these costs included the relocation of Redeem Holding and its subsidiary Environmental Mobile Control to premises “capable of supporting rapid expansion”.
Carver stated the company intended to continue expanding in Europe and beyond.
“The aggressive organic growth plans will be supplemented by carefully targeted acquisitions to extend our geographical reach and service capabilities,” he said.
Redeem is in the process of establishing a subsidiary in Germany to service Central Europe. The group is aiming to be a European market leader by 2015.