By Phil Boeyen, ShareChat Business News Editor
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Friday 15th February 2002 |
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The net profit figure was 8.7% lower than the previous year's $14.33 million but the drop had already been built into the company's share price given last year's warning.
Stronger competition in Auckland and an unsuccessful bid for the Auckland City Council collection and disposal contract weighed on the company's result although operating cash flows exceeded last year.
"Because of the size of our Auckland business, the increases in performance in our other divisions could not compensate for this impact," WAM says.
"Of greater long term significance for the company was the fact that we made real progress during the year, particularly with the successful entry to the Australian market where our new acquisitions performed in accordance with expectations."
The company says the highlight of the year was the award of a new 15-year collection and disposal contract for Hamilton City Council although its expansion in Australia is also notable.
This included the purchase of two waste management businesses and a small collection business across the Tasman.
"The board is encouraged with the six month results to December which also include earnings from a site remediation project in Brisbane. They were in line with projections. It is confident that the 2002 year will demonstrate sound investments have been made and that there are good growth prospects."
Looking forward WAM says it has responded vigorously to competitor activity in Auckland and notes that the impact of the America's Cup in Auckland later in the year should be positive and construction activity is expected to increase.
"New opportunities and process improvements in our Australian business are expected to deliver a sound result in their first full year. Further acquisition opportunities will also be explored."
The directors say they anticipate a return to earnings growth in the current fiscal year. A final dividend of 5 cents per share will be paid.
Waste Management announced on Thursday that it had completed negotiations on what is believed to be New Zealand's first carbon trade in which it has an option to sell the carbon emission reduction value from some of its landfill gas to energy systems to a North American based energy company.
"It is the type of transaction that will occur frequently after the Kyoto Protocol is ratified," the company said.
Although the deal is not large in dollar terms the company believes the real significance is that a market has now been established and the carbon credit exchange appears to have real potential.
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