Waste management firm Augean eyes deals as profits jump
The company, which was formed in 2004 and helps clients deal with waste and comply with necessary regulations, saw a 16 per cent jump in pre-tax profit to £7 million last year, with revenues up by a quarter to £76m. Including exceptional items of £5.7m, pre-tax profit was down by 50 per cent to £1.3m.
• READ MORE: New North Sea waste hub planned for port of Dundee
Chief executive Stewart Davies told The Scotsman that the firm was “very pleased” with the year’s performance, adding: “We’ve got strong cash generation, a robust balance sheet and are really confident in maintaining double-digit increases in profitability for 2017”.
The business said Augean North Sea Services traded well in the second half of 2016, “with further progress on its diversification objective including the partnership with Forth Ports Limited for the management of waste arising from the decommissioning of offshore equipment at the Port of Dundee”.
Davies said the Dundee site broadens the geographic reach of the company’s North Sea arm, which has sites from Lerwick and down through Aberdeen, and enables it to tackle hazardous waste arising from decommissioning.
“That gives the Port of Dundee an advantage in terms of bidding for decommissioning work and we’re collaborating with them right now on active bids,” he said.
He also said Augean was focused on expanding organically and has opportunities for growth and across all of its activities, particularly in oil and gas, where it has diversified.
In terms of potential M&A activity, finance director Mark Fryer, who is also taking charge of business development, said: “Obviously, while the rest of the market is in recession that’s sometimes one of the best times to look to acquire some of your competitors, so we are actively looking.”
As for where it is targeting, he said the focus is on industrial and waste service where its activities are growing, and with the North Sea arm having historically very Aberdeen-focused, “I think we would like to have more of a presence in Peterhead.”
Broker N+1 Singer said in a note on the results that Augean has “good prospects for continued growth in 2017 and beyond”.