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Disposal of waste material from the Victoria Park Tunnel has helped waste management company EnviroWaste Services boost earnings by 6% in the year to June.
But its full accounts, yet to be released publically, will show a net loss of $11.7 million due to interest payments on debt.
EnviroWaste, owned by Australia-based private-equity firm Ironbridge Capital, said its earnings before interest and tax rose 6% to $25.4 million from the previous year.
Revenue rose to $144 million from $133.4 million in financial year 2010 and $110 million in financial year 2009.
“We’ve seen good earnings growth despite the economic conditions which I guess is testament to the defensive nature of the assets, Ironbridge's New Zealand operating partner, Kerry McIntosh said.
The company is in the process of filing its statutory accounts with the Companies Office.
Mr McIntosh, told NBR the net loss from operations would be $11.7 million, up slightly on last year’s $10.5 million, due to capitalising interest on shareholder loans, but significantly better than the $21.7 million loss in 2009.
Interest bearing debt at the June 2010 balance date was $383 million with bank loans of $201.7 million and shareholder loans of $178.4 million.
Mr McIntosh said shareholder loans now totaled about $196 million including $129.2 million of redeemable preference shares and $67 million of convertible loan notes.
Ironbridge acquired the company in 2007.
Mr McIntosh was tightlipped on Ironbridge’s intentions for the company.
"As we’ve said a number of times we don’t really comment on our plans for portolio companies and that would include envirowaste. Most private equity funds have a ten ytear life. People talk about five years but certainly peole’s hold periods have been extended because of the GFC and that’s a phenomia in private equity right around the world."
The earnings result was underpinned by several large contaminated soil disposal contracts, including from the Victoria Park tunnel development. In addition, EnviroWaste achieved sizeable growth in its commercial market share with several high profile national waste collection accounts won over the period.
Its municipal services business continued to grow strongly as it benefitted from the Dunedin City Council kerbside refuse and recycling collection and Wellington City Council kerbside recycling collection contracts won in 2010. In 2011 the company successfully tendered for the MacKenzie District Council kerbside recycling collection contract, the Porirua City Council landfill management contract, as well as extending its kerbside recycling collection contracts with Auckland Council into the Papakura and Franklin regions.
“EnviroWaste continues to go from strength-to-strength in each of its markets”, Mr McIntosh said. “The company is now recognised as the leading environmental solutions innovator in the industry and is seen by its customers as being capable of delivering real value-for-money “waste solutions”.