Pact Holdings (ASX: PGH) has extended its existing contract to own, operate, wash and store a crate pool for Woolworths Group.
Pact’s crate manufacturing and pooling business forms part of its materials handling and pooling segment.
The Woolworths contract was originally announced on the ASX on 16 May 2016 and has now been extended for a further 10 years.
Pact Group said the current annual revenue generated by the company in connection with the Woolworths Contract exceeds $50 million per annum.
Woolworths Group also had an option under the Woolworths contract to purchase 50 per cent of the shares in the Pact entity that provides services to Woolworths. Woolworths has agreed to remove this option.
Pact managing director and group CEO Sanjay Dayal said, “We are very pleased that Woolworths has extended what is clearly a cornerstone and material contract for our crate manufacturing and pooling business.
“This extension reflects our strong relationship with Woolworths and is further evidence of our market leading capability in crate pooling that underpins the performance of our materials handling and pooling segment. We are looking forward to working with Woolworths over this period.
“This is another example of Pact’s and Woolworths’ long-term commitment to the circular economy, with Pact having also recently entered into a new partnership with Woolworths to provide packaging to increase the recycled content used in Woolworth’s own brand packaging.”