Close the Loop records strong performance in its first full-year reporting period

Close the Loop Group (ASX:CLG) has recorded strong performance in its first full-year reporting period as an ASX-listed company, ensuring it has achieved or exceeded key prospectus metrics and delivered on its strategic pillars.

The company revealed a revenue of $89.2 million, 20.7 per cent above its prospectus forecast and up 32.3 per cent on the prior corresponding period. Its EBITDA was recorded at $14.3 million, 16.3 per cent above prospectus forecast and up 8.3 per cent from the previous corresponding period.

The company said its strong organic revenue growth across all divisions contributed to its significant earnings uplift, and its acquisitions of Oceanic Agencies, Crasti & Co. and Alliance Papers have added to its sales and profitability levels.

The acquisition of Oceanic Agencies added revenue of $4.4 million over seven months while Crasti & Co. had revenue of $2.5 million for the three months after its acquisition. Alliance Paper was acquired towards the end of Close the loop’s financial year.

“We acquired complementary and earnings accretive businesses in Oceanic Agencies and Crasti & Co. and in July, added Alliance Paper. These three acquisitions add to the cumulative power Close the Loop has in its ability as the only ASX-listed company operating in all parts of the circular economy,” Close the loop Group CEO Joe Foster said.

Within the group’s divisions, O F Pack brought in a revenue of $27.4 million despite challenging supply chain issues and increasing raw material costs, while Close the Loop USA recorded a revenue of $22.1 million – a faster rebound from COVID than expected.

Foster International Packaging brought in $8.6 million, which was achieved while overcoming challenging conditions in the South African market, and O F Resource Recovery brought in $8.2 million due to a consistent supply chain and string pricing points, according to the company.

Close the Loop Australia recorded $7.4 million in revenue because of increased TonerPlas sales and its battery and cosmetic collection network, while the European side of the business earned $5.6 million in revenue because of new business activities such as toner bottle cleaning and the development of new circular economy models for customers beyond the printing business.

O F Flexo brought in $3 million in revenue due to its focus on sustainability, which allowed the division to gain higher exposure to more customers keen to improve their ESG credentials.

“We achieved string organic growth in niche packaging and recycling and increased sales from an increasing range of circular economy products. To meet demand, we increased production capacity, made further investment in resource recovery equipment and efficiency improvements and added additional resources to implement new take-back programs,” Foster said.

“We expanded our presence internationally, increasing our packaging presence in the USA and expanded the sustainable packaging business in South Africa through our Foster International Packaging division. Our Close the loop USA division also reported a strong revenue increase in FY22, with a solid recovery from COVID-19 losses.

“We enter the new financial year in a strong position to continue to deliver on our growth strategy and accelerate our growth momentum through further earnings accretive acquisitions and organic growth as we use our innovations to create new take-back re-use and recycle programs and circular economy solutions.”

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