Cleanaway celebrates hefty results boost


Sharp eye on outgoings gives bottom line a shine

Cleanaway celebrates hefty results boost
Cleanaway's restructure is working

 

Waste fleet and facilities owner Cleanaway gained a 38.5 per cent net profit lift to $63.3 million in the past financial year on a continuing cash-flow focus throughout the company.

Part of the boost came from a reduction in fuel expenses from $46.8 million to $37.6 million, on repairs and maintenance, from $95.1 million to $$85.5 million and on freight expenses, from $17.9 million to $16.5 million.

The bottom line jump came on a more modest 5.1 per cent revenue rise to $1.455 billion.

"Over the past 12 months we have worked at resetting the operational performance of our businesses," CEO Vik Bansal says.

"We have made progress across a wide number and variety of initiatives, targeted at improving our quantity and quality of earnings including free cash flow of the Company, but there remains more to do.

"Our focus on customers and service has increased and we are seeing the benefits via the organic growth in our revenues for the first time in a number of years.

"The streamlining and simplification of the group’s organisational and operating structure has also contributed to this result with a portion of the savings achieved in FY16 being re-invested in a number of market share and revenue growth initiatives.

"I am confident that our target of a permanent $30 million reduction in our cost base, compared to the cost base in FY15, will be achieved by the target date of 30 June 2017.

"We have implemented a more disciplined approach to capital expenditure and spend on our remediation and rectification responsibilities.

"We now have plans in place which resulted in increased free cash flow this year and will generate increasing free cash flows into the future.

"The review of the rectification and remediation spend alone has resulted in an increase of approximately $30 million in our targeted free cash flows over the next four years."

Cleanaway also revealed the purchase price of Queensland’s Waste 2 Resources Group, putting it at $8.5 million.

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