Waste Management Segment

Economic framework conditions for the waste management sector

The economic environment for providing traditional waste management services in the first half of the 2023/2024 fiscal year remained challenging against the backdrop of persistently high inflation with wage and salary settlements to match accompanied at the same time by a drop in economic productivity. This was noticeable in the commercial and industrial customer area, and others, when implementing price increases.

Compared to the first half of the previous fiscal year, a sufficient quantity of waste for thermal recycling was available on the market; this meant that utilisation of the thermal waste recycling plants remained high.

The framework conditions for the recycling materials recovered paper/cardboard improved in the reporting period compared with the previous year. The Wiesbaden index for paper and cardboard packaging was around 36.0% higher in the first half of the 2023/2024 fiscal year than in the same period of the previous year. In addition, the volumes of paper and cardboard handled increased compared to the previous year.

Scrap metal as a recycling material saw a continuation of the previous fiscal year 2022/2023’s development. Average steel scrap prices in the first half of 2023/2024 were roughly on a par with the last quarter of the 2022/2023 fiscal year, with a sharp increase securing a positive impact on earnings from January 2024 onwards.

The amendment to the Packaging Ordinance, which has ensured obligatory participation in a collection and recovery system for commercial packaging since 1 January 2023, led to a loss of marketing opportunities for waste management companies for these recycling materials. At the same time, the conditions for providing services in this area, such as transporting and handling packaging, improved.

With effect from 1 January 2024, waste transportation of volumes above 10 t and over distances of more than 200 kilometres must be effected by rail or similarly climate-friendly means of transport, with the kilometre threshold due to drop to 100 kilometres by 1 January 2026. Starting in January 2024, it has become necessary to submit an application for an increasing number of transport tasks as the mileage limit as of 1 January 2023 was still 300 kilometres. At the same time, the availability of rail transport options has been very limited, causing rail transport to play a subordinate role for Energie AG Oberösterreich Umwelt Service GmbH (Umwelt Service GmbH).

Business development in the Waste Management Segment

Sales revenues in the Waste Management Segment amounted to EUR 144.4 million in the first half of 2023/2024 and were therefore 3.7% above the previous year's level of EUR 139.2 million. EBIT rose from EUR 21.2 million in the first half of 2022/2023 to EUR 22.0 million in the reporting period.

In addition to higher metal and waste paper sales, higher sales revenues from district heating and electricity were primarily responsible for the year-on-year growth in sales. It also proved possible to grow the EBIT due to higher sales; this was despite lower plant availability due to unplanned downtime at the waste incineration plant in Lenzing, higher personnel expenses, higher maintenance costs for the two waste incineration plants in Wels and Lenzing, and higher insurance expenses.

Utilisation of the waste incineration plants

Incinerated waste volume

in 1,000 t

The two waste incineration plants in Wels and Lenzing reported a lower throughput volume of 279,108 t in the reporting period (previous year 302,434 t).

Throughput volumes at the waste incineration plant in Wels were roughly on a par with the same period of the previous year. Even during an unplanned plant shutdown in January 2024, the district heating supply to the city of Wels was ensured without interruption by the replacement system consisting of hot water boilers provided for this purpose. The Lenzing waste incineration plant reported far lower throughput volumes in the first half of the 2023/2024 fiscal year than in the same period of the previous year. This was due to unplanned plant shutdowns in November and December 2023 and in January and February 2024.

At the Lenzing waste incineration plant, the annual inspection took place in the period 29 February 2024 to 18 March 2024. In Wels, the inspections of the two incineration lines are not scheduled to take place until the second half of the 2023/2024 fiscal year.

In the reporting period, the waste incineration plant in Wels, the replacement system consisting of hot water boilers and heat from biomass and solar energy procured from third parties distributed 210 GWh of heat (previous year: 202 GWh) to the district heating network of the city of Wels and to one other key account customer. Electricity procurement totalled 88 GWh (previous year: 91 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 735,888 t (previous year: 754,712 t). The 2.5% decrease was mainly attributable to lower volumes of municipal waste and recycling materials.

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

For the first time since the district heating supply was established, an output of more than 100 MW was fed into the district heating network of the city of Wels on 9 January 2024. On this day, Umwelt Service GmbH generated more than 2,000 MWh of heat in total.

In the scope of the Group-wide “LOOP” strategy project, the campaign for a switch to electrically powered vehicles continues. Umwelt Service GmbH again took part in the tender for promoting zero-emission commercial vehicles and infrastructure (ENIN) and was awarded funding for the purchase of further electric trucks and the associated electric charging infrastructure at the Hörsching location. The subsidised charging infrastructure for electric commercial vehicles at the Redlham location was installed during the reporting period. The first electric commercial vehicles are due for delivery in the second half of the 2023/2024 fiscal year.

The investigations throughout Austria into the area of collection and transport in the waste management industry initiated by the Federal Competition Authority (BWB) in the 2020/2021 fiscal year are still in progress. Umwelt Service GmbH is actively involved in the investigation and has assured the BWB of its full willingness to cooperate.

The economic environment in South Tyrol was challenging in the first half of the 2023/2024 fiscal year. In particular, the refuse-derived fuels proved difficult due to a drop in demand from the cement industry. The declines were only partially offset by higher revenues from glass and metal.

The framework conditions for drinking water supply and waste water management in Austria were largely stable during the reporting period. At WDL-WasserdienstleistungsGmbH, the main focus was on maintaining the secure supply of drinking water and further developing the services offered.