Suez’s half-year results have shown a fall in revenue at its UK recycling and recovery operations, despite the company enjoying an overall growth in profits.
UK recycling and recovery revenue fell 5.3% in the first half of 2018 compared with the same period last year, from around £404m to £383m.
Organic growth, a measure of revenues derived from the company’s existing services rather than through acquisition, fell by 3.5% during the same period. Suez said this was “due to an adverse construction effect unrelated to the volume trend”.
The company reported that average scrap metal prices had increased by 19%, but that profits had been hit by lower paper and cardboard prices following China’s import restrictions. Prices of these materials dropped 38% on average.
But the results revealed a healthy organic growth in Europe recycling and recovery of 3.6%. Suez said this was in part down to the construction of a £60m transfer centre for the treatment of household waste in Devon.
Jean-Louis Chaussade, Suez Group chief executive, said: “The year has started off well. The group’s growth momentum is intensifying.
“Growth was also robust in the international and the recycling and recovery Europe divisions, with a strong commercial performance in all geographies.”
Suez’s half-year results for 2017 said that completion of the construction of energy recovery plants in the UK had a “negative impact on revenue for the region”. Two Suez energy-from-waste plants – in Cornwall and Wilton in Redcar – were officially opened in June this year.