LONDON (Alliance News) - Augean PLC on Tuesday reported sharp rise in annual profit due to significantly less exceptional items but warned that its dispute with UK tax collector HMRC is still ongoing.
In 2018, the hazardous waste treatment and disposal company more than doubled its pretax profit to GBP10.6 million from GBP4.6 million in 2017.
Augean booked GBP2.0 million in exceptional items in 2017, with GBP1.1 million in costs associated with its landfill tax dispute with the UK government. The company's exceptional items in 2018 decreased to GBP322,000.
Augean's revenue increased 19% to GBP79.7 million from GBP67.0 million. The company's waste treatment activities unit - which sits within Augean's treatment & disposal business - increased its revenue by 53% to GBP20.7 million.
The company's operating expenses increased 14% to GBP67.6 million from GBP59.4 million.
"2018 was a pleasing year as the group continued to make significant changes to streamline activities, enhance performance and focus on both cash generation and retention," said Executive Chair Jim Meredith.
"Strong trading in the group's underlying business, the exit from unprofitable businesses, good cash control and cost savings have enabled the group to report a cash balance of GBP8.2 million compared to the GBP10.8 million debt position reported last year," Meredith added
Augean increased the volumes of waste disposed to its landfill site by 14% to 523,000 tonnes with ash treated volumes increasing 29% to 189,000 tonnes.
The company said it remains in dialogue with UK tax collector HMRC over certain landfill tax payments not made by two of the companies operating subsidiaries, Augean North and Augean South.
In February, HMRC issued Augean South with a final assessment for GBP16.2 million from the period from February 2015 to May 2018. At the time, Augean noted there may be other final assessments for other time periods for Augean South.
Back in October, Augean had received a GBP10.5 million bill, rising to GBP11.4 million including interest, for Augean North.
Augean won't have to pay the assessment for Augean North until the tribunal has finished. The company is legally challenging both assessments through tribunal.
The company said it will not be paying a dividend until the HMRC matter is resolved.
Looking ahead, the company said it is targeting further growth in its key markets of energy from waste and North Sea decommissioning.
Chair Meredith added: "The group is currently experiencing strong initial trading for the start of 2019 and the board is confident in the group's prospects for the year. Our focus will continue to be on cash control and so improving our cash position."
Shares in Augean were down 3.6% Tuesday at 81.00 pence each.
