Waste Management Segment

Economic environment for the waste management sector

It was largely possible to provide traditional waste management services under favourable waste management general conditions in the first half of 2020/2021. Due to what are continuing high volumes of waste requiring thermal processing, waste incineration plants throughout Europe continued to be well utilised.

After the negative development in the previous year, there was a clear trend reversal in recovered paper/cardboard and metal recycling materials. Since the beginning of the fiscal year, the Wiesbaden Recovered Paper Index has continuously increased in value. Metals have shown a similar trend, with price development being significantly more dynamic compared to recovered paper/cardboard.

In autumn 2020 and spring 2021, further COVID-19 lockdown restrictions were imposed. This again resulted in more difficult general conditions under which business operations had to be maintained. Despite this, it was possible to maintain the system-critical supply services to the highest possible degree and conduct operations in a largely undisturbed way while complying with the prescribed safety and hygiene regulations.

Business development in the Waste Management Segment

Sales revenues in the Waste Management Segment amounted to EUR 122.8 million in the first half of 2020/2021 and were therefore 7.5% above the previous year's level of EUR 114.2 million. EBIT tripled from EUR 6.8 million in the first half of 2019/2020 to EUR 20.4 million in the reporting period.

The increase in earnings was due on the one hand to good market conditions, primarily for recovered paper/cardboard and metal recycling materials, and on the other to a positive effect of EUR 1.2 million from the sale of land in Hörsching. In addition, reversals of impairment of EUR 3.5 million were made in the area of thermal plants in the reporting period. In contrast, the previous year's result for 2019/2020 was negatively affected by the partial write-down of the plastic sorting plant in the amount of EUR 2.4 million and by other additional costs as a result of the fire at the Hörsching site.

The first half of 2020/2021 was partly characterised by strongly rising recovered paper, cardboard and metal prices, which led to positive deviations in sales revenues and results compared to the previous year. Driven by price increases introduced in January 2020, the other waste management services also saw development above the previous year's level. Positive developments were observed in construction site waste and hazardous waste, among other sectors, as well as in energy revenues due to electricity drawn from Welser Abfallverwertung (WAV). The negative influences of the COVID-19 pandemic were only minor and primarily affected the two incineration plants.

Utilisation of the incineration plants

Incinerated waste volume

in 1,000 t

The two incineration plants in Wels and Lenzing achieved a throughput of 285,442 t in the reporting period (previous year 310,658 t). The decline is due on the one hand to a lower demand for process heat supplies from the waste incineration plant in Lenzing, and on the other to the increased proportion of plastics in waste, which contributed to a higher calorific value and therefore to lower throughputs in the incineration plants. Due to unplanned shutdowns, fewer operating hours were recorded than in the previous year.

In Wels, the annual overhaul of the thermal system of line 2, across fiscal years, was completed. At the Lenzing incineration plant, the annual inspection took place as planned.

In the reporting period, the waste incineration plant in Wels distributed 158 GWh of heat (previous year: 143 GWh) to the district heating network of the town of Wels and to one other key account customer. Electricity procurement totalled 91 GWh (previous year: 97 GWh).

The treatment plant for hazardous waste in Steyr was again very well utilised in the reporting period.

Total waste volume handled

in 1,000 t

Compared with the previous year, there was a downturn in the total volume handled in Austria and South Tyrol to 843,713 t (1st half year 2019/2020: 847,802 t).

Strategically anchored cost management was consistently pursued in the reporting period and the ongoing optimisation projects were further implemented.

Participation in the process of plastic replacement sorting for Altstoff Recycling Austria AG (ARA), which had been organised via the Hörsching site after the fire incident on 10 October 2019, was terminated at the end of December 2020 for economic reasons. Reconstruction of the plastic sorting plant is currently under consideration.

In connection with the fire at the Hörsching sorting plant, the criminal proceedings against Energie AG Oberösterreich Umweltservice GmbH (Umwelt Service GmbH) under the statute on responsibility of legal entities (Verbandsverantwortlichkeitsgesetz) were discontinued by the Linz public prosecutor's office in April 2021.

The reconstruction work surrounding the relocation of the company headquarters from Hörsching to the WAV site in Wels continued in the first half of the year. From today's perspective, the relocation of the company headquarters can be expected in autumn 2021.

In addition, preparations started at the Wels site for the planned further expansion of district heating extraction from WAV in the course of reorganising the cooperation between Energie AG and eww ag, in order to be able to supply the city and the neighbouring areas in an even better way looking forward. The tendering process for various sub-projects was the focus of activities.

The Federal Competition Authority (BWB) is conducting investigations throughout Austria into the area of collection and transport in the waste management industry. In the course of these investigations, the premises of Umwelt Service GmbH at the Hörsching site were also searched on 16 March 2021. Umwelt Service GmbH is actively involved in the investigation and has assured the BWB of its full willingness to cooperate.

Stable development in South Tyrol

The economic environment to which the Neumarkt location is subject has seen a slight improvement since the beginning of the 2020/2021 fiscal year. However, minor losses in tourism, trade and industry are again expected in the coming months. The economic development of the site, which is strongly focused on recycling materials management, was stable in the past half year.