AUG.L Share News (AUG)

LONDON (Alliance News) - Waste management firm Augean PLC said Tuesday it will continue to battle claims from the UK taxman after it was issued with GBP37.6 million worth of tax assessments.

The new assessments cover Augean North Ltd and Augean South Ltd in the periods October 2013 to July 2017 and August 2013 to August 2017, respectively.

Further, HMRC said it will consider a reduction in the value of the previous five assessments it has receive to GBP7.5 million from GBP12.0 million.

HMRC is also planning to apply interest on the tax demands, and it is considering penalties for Augean.

Though the company is pleased the taxman has recognised most of its tax exemptions and is working quicker than expected, it still believes it has paid landfill tax correctly and continues to defend its position that HMRC has no claim. Further, Augean clarified the claims were "not unforeseen".

Augean first announced the news of a landfill tax assessment last August, an issue which has claimed its annual dividend.

In late March, Augean sunk to loss of GBP3.1 million in 2017 from a GBP1.3 million profit made in 2016, due to losses on the legacy Colt contract and cost increases through the second half of 2017.

The company booked GBP1.2 million of costs related to the tax assessment, and Augean decided not to declare a final dividend, having paid a dividend of 1.0 pence in 2016.

Shares were down 3.6% on Tuesday at 28.43 pence each.