LONDON (Alliance News) - Augean PLC on Tuesday sunk to loss and said it will not pay dividend for 2017 due to an ongoing tax assessment being conducted by HM Revenue & Customs.
The waste management business operating in the UK sunk to loss of GBP3.1 million from GBP1.3 million profit made in 2016, due to losses on the legacy Colt contract and cost increases committed through the second half of 2016.
Exceptional costs totalled GBP8.6 million, comprised of a GBP6.3 million non-cash impairment of Colt assets and redundancy costs of GBP1.0 million. Remaining GBP1.2 million was related to the HM Revenue & Customs assessment for landfill tax of GBP700,000 with interest of GBP100,000 for the three months to the end of October 2013.
Augean has decided not to declare a final dividend, having paid a dividend of 1.0 pence in 2016.
Revenue from continuing operations in 2017 rose 11% to GBP84.7 million from GBP76.0 million the prior year, driven by growth in its four out of five business units.
Augean Integrated and North Sea Services performed particularly well as revenue at both divisions grew by 41%. Augean Integrated Services revenue was GBP10.7 million, compared with GBP7.6 million in 2016, while Augean North Sea Services reported revenue of GBP18.2 million, up from GBP12.9 million the year prior.
However, revenue in Augean's Energy & Construction division declined 17% to GBP21.0 million from GBP25.3 million, due to lower construction soil volumes.
Augean Executive Chairman Jim Meredith said: "2017 was a challenging year with the HMRC Landfill Tax assessments and a decline in group profitability. We remain in active discussions with HMRC but do not anticipate a swift resolution. Steps have been taken to reduce the group cost base by GBP4.0 million and we have also reduced group debt from over GBP18.0 million in the autumn to under GBP11.0 million by year-end. Trading has commenced the year in line with board expectations."
