A number of visible operational actions taken in December 2017 are consistent with the stated business direction in each of the three divisions concerned and reinforce strong positions in their specialist markets. While there is no change to estimates, this activity confirms that steps are being taken on a broader front to drive group progress in addition to identified merger integration plans.
New Canadian facility commissioning underway
Construction phase effects at the new, closed loop Surrey, Canada municipal waste facility distorted H118 divisional trading performance, so it is encouraging to note that the first waste has now been received and processed at this location. It will be producing biomethane gas (to be used as fuel in waste collection vehicles) and compost materials (for agriculture and landscaping uses) under a 25-year PPP contract with the Government of Canada. The facility is expected to become fully operational during the first six months of 2018, with profitability to build gradually. This is consistent with our expectation of a positive aggregate profit contribution from Renewi's (LON:RWI) three Canadian municipal facilities in FY19.
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