PowerHouse Energy Group (PHE); reports ongoing commercialisation of DMG® process

Renewi

LN: RWI

£282.5m market cap

35.25p last close

Renewi is a waste-to-product company with operations primarily in the Netherlands, Belgium and the UK. Its activities span the collection, processing and resale of industrial, hazardous and municipal waste.

Investment summary

Further Commercial progress and tangible evidence that ATM can become a more positive contributor to group earnings were Renewi’s strongest H120 messages. As previously announced, Monostreams was mixed with profitability down 16% overall, with UK Municipal revenue and profit also lower. Working capital inflow, controlled capex spend and initial disposal proceeds (Municipal Canada only) all contributed to a reduction in core net debt to €514m or 2.88x EBITDA (down from 3.06x at the end of FY19). Trading so far in H220 has matched management expectations at the headline level and FY20 guidance is unchanged. Outlook caveats in Commercial caused us to temper our expected future growth rate here pending further updates. Despite this, we expect Renewi to enter FY21 with a more progressive corporate agenda – starting with its Euronext listing at the end of January – centred on improving profitability of the continuing businesses.

Y/E Mar
Revenue (€m)
EBITDA (€m)
PBT (€m)
EPS (c)
P/E (x)
P/CF (x)
2018A 1760.3 176.3 63.0 5.9 7.0 2.3
2019A 1780.7 179.7 63.1 6.0 6.9 3.8
2020E 1675.7 154.6 39.7 3.7 11.2 2.4
2021E 1705.6 163.5 50.1 4.8 8.6 2.0
Industry outlook

The Dutch waste market, accounting for the largest single business within Renewi, has grown as the economy has recovered.

Last updated on 12/02/2020
Sector
Industrials
Share price graph
Balance sheet
Forecast net debt (€m) 490.4
Forecast gearing ratio (%) 199
Price performance
%
1m
3m
12m
Actual 0.0 17.7 33.5
Relative* 1.8 14.8 26.6
52-week high/low 37.2p/21.9p
*% relative to local index
Key management
Colin Matthews Chairman
Otto de Bont CEO
Toby Woolrych CFO

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