Pennon says trading tough at waste management unit

Reuters News
Posted: Aug 17, 2012 2:25 AM

LONDON (Reuters) - Britain's Pennon cautioned that trading at its waste management unit Viridor since the end of March had been difficult, though strong performance at its water and sewerage business had helped the company to perform in line with its own expectations.

"Viridor is not immune to the difficult conditions in the world economy and trading has been significantly below the high level of last year's first half with recyclate prices remaining under pressure," the company said in a statement on Friday.

Viridor, which was seen as a key driver of growth for Pennon, struggled in the second-half of last year, hurt by lower prices for waste paper or recovered metals, recyclate.

The company's water and sewerage business, South West Water, had continued its strong performance against the 2010-2015 regulatory contract. Its overall financial performance since the end of March remained in line with its own expectations.

Shares in Pennon closed at 749.5 pence on Thursday, valuing the company at 2.7 billion pounds.

(Reporting by Brenda Goh, Editing by Sarah Young)