Cannock plant contributes £8m to Biffa loss
Biffa has been forced to write down the value of a major waste-to-energy plant in Cannock as closures of hotels, pubs and restaurants had a major impact.
The waste giant, which operates waste collection services in Cannock, South Staffordshire and Stafford, swung to a pre-tax £52.8 million loss in the year to March 26, down from a £56.4m profit in the previous 12 months.
More than £8m of this loss came because of impairment charges at the decade-old Poplars anaerobic digestion plant, which cost £24m to develop, at its Poplars landfill site at Lichfield Road Norton Canes.
The facility was the biggest of its kind when it was built in 2011 and recycles leftover food into gas.
"Covid-19 had a significant impact on the hospitality and accommodation sector, resulting in lower volumes of food waste," Biffa said.
The business also said that gas generation at the site was adversely affected by an increase in hand sanitiser in the food it collected to recycle.
In addition, Biffa said its swing to a loss was driven by an IT replacement project, which cost around £14 million.
Revenue dipped 10.4 per cent to a little over £1 billion, it said.
Chief executive Michael Topham said: "It has been a year none of us want to repeat but certainly one which showed us at our best.
"We are pleased to have been able to end the financial year with results ahead of our expectations.
"We are strongly positioned for the post-pandemic recovery with leadership positions in our core markets, a well-developed investment programme and exciting growth opportunities ahead, leveraging the group's unique position at the heart of the circular economy."
Biffa said it had reduced greenhouse gas emissions by 17 per cent over the last year by launching the UK's biggest electric bin lorry fleet in Manchester, meaning that emissions are down 40 per cent over the last five years.
The company also has a materials recycling facility at Aldridge, built in 2008, and has recently invested to increase plastic recycling there to 80,000 tonnes a year. It has a waste services site in Ludlow.
Biffa says it took swift and decisive action taken from the outset of the Covid-19 pandemic focusing on protecting the health, safety, and wellbeing of its staff, ensuring minimal disruption for customers and protecting the group’s financial strength
Last month it announced the acquisition of the collections business and some recycling assets from Viridor for £126m.
Completion of the deal is expected no earlier than August.
Viridor has a transfer station in Steelhouse Lane, Wolverhampton, and a collection services and glass recycling site at Tividale.
