Augean profits rise after it dumps loss-making businesses

Specialist waste management business Augean saw its shares jump over 10% on Tuesday after reporting that first half profit was ahead of the previous year by over a third on a like-for-like basis.

The group said it expects to deliver full-year profit growth at least in line with market expectations after benefitting from increased ash volume from energy-from-waste plants, as well as nuclear and North Sea decommissioning.

Jim Meredith, executive chairman of Augean, said: "Pleasingly the first half of 2018 has delivered significant and sustained progress having, as anticipated, grown sales in key strategic markets, whilst removing some unprofitable activities from the business, reducing the business cost base and driving cash generation to deliver significant debt reduction."

Augean sold off the loss-making activities of Colt Industrial and Augean Integrated Services over the six-month period leading to 30 June.

The AIM-traded company’s net debt stood at £2.7m as of 30 June, compared with £10.8m at 30 December, with a current expectation of being debt free by the end of the year.

"Notwithstanding the ongoing HMRC matter, the Board remains confident in the prospects for the full year at least in line with expectations," said Meredith.

Augean said it is currently committed to "robustly" challenging previously received landfill tax assessments through the tax tribunal system and is engaged in "positive discussions with HMRC" in order to resolve the matter.

Augean’s shares were up 16.67% at 42.00p at 1548 BST.