Cleanaway Waste Management (CWY) H2 2024 earnings summary

Executive summary

• Achieved double-digit EBIT growth and improved ROIC, with strong operational execution, strategic project delivery, and Blueprint 2030 strategy execution underpinning confidence for FY25 and FY26.

• Restoration of Queensland Solids and transformation of Health Services contributed significantly, with Health Services moving from loss-making to profitability.

• Operational excellence initiatives and disciplined price management drove margin expansion and productivity improvements.

• Strategic infrastructure projects, including VIC CDS, Western Sydney MRF, and expanded resource recovery capacity, progressed as planned.

• No significant environmental incidents; progress on emissions reduction and sustainability initiatives.

Financial highlights

• Net revenue rose 7.7% to $3,194.5 million year-over-year, with growth across all segments.

• Underlying EBIT increased 18.9% to $359.2 million, with EBIT margin up 100bps to 11.2%.

• Net profit after tax grew 14.8% to $170.6 million; EPS up 15.2% to 7.6 cents per share.

• Net operating cash flow up 12.5% to $542.1 million; cash flow conversion ratio at 97.6%.

• Final dividend of 2.55cps, fully franked, bringing the full year dividend to 5.0cps.

Outlook and guidance

• FY25 underlying EBIT guidance set at $395–$425 million; D&A expected at $380–$400 million; net interest expense at ~$130 million.

• CapEx for FY25 expected to be ~$400 million, with $250 million for maintenance and $150 million for growth.

• On track to achieve midterm ambition of >$450 million EBIT in FY26, with internal stretch target of $500 million.