9 Jan 2009 07:00
| For release | 07:00 | Date: 9 January 2009 |
Pre-Close Trading Update
The TEG Group Plc, the AIM-listed cutting edge green technology company, which converts organic wastes into natural organic fertiliser, confirms that revenues in 2008 were in line with the Board's expectations. The Company experienced significant growth and trading in the second half was consistent with the first half. Full year results for the year ending 31 December 2008 will be announced in March 2009.
The Board is confident that the business will continue to develop strongly in the coming year. It is however anticipating a delay to two projects in the private sector, both due to restrictions in the availability of finance to clients in the first part of 2009 and in such market circumstances it believes it is appropriate to be prudent and accordingly is reducing its previous 2009 growth expectations. Despite the anticipated delays, the Board expects continued growth in 2009.
The Company is also pleased to announce that commissioning of its newly completed facility in Exeter has commenced following an official opening in December 2008. The facility is owned and operated by Verdia Horticulture Limited ("Verdia"), the joint venture between TEG and Glendale Managed Services Limited. The Verdia facility has a capacity of 14,000 tonnes per annum, producing approximately 8,000 tonnes per annum of compost. The compost will be matured and blended to produce horticultural grade material for sale into the local horticultural sector.
Commenting for TEG, Chief Executive Mick Fishwick said: "We are very pleased to have performed to expectations in 2008 and to have achieved such significant growth. It has been a ground breaking year for the Company. Given the general uncertainties in the economy and the difficulties for everybody in obtaining project finance, we are very pleased to be in a position of strength and to be confident in the continued development of the business for the foreseeable future."
ENDS
Contact:
Editor's Notes:
Greater Manchester Waste PFI Contract
On 29 January 2007, TEG announced that it is a principal sub-contractor to the Viridor-Laing consortium that has been awarded preferred bidder status for the Greater Manchester Waste PFI contract. TEG is the exclusive supplier of In Vessel Composting ("IVC") technology to the consortium.
TEG is expected to build four plants as part of the consortium, over the period from 2008 to 2011 with a combined capacity of 175,000 tonnes per annum, producing 125,000 tonnes of compost product per annum. The plants will all process green waste and kitchen waste collected from households in the Greater Manchester region.
TEG was awarded an Advanced Works Order ("AWO") in 2008 and construction of the facility at Rochdale commenced in June 2008. Design work for the second plant at Bredbury was also included in the AWO.
TEG
TEG provides an in-vessel composting technology, which is one of the few approved technologies capable of treating animal by-product (ABP) waste. Plant economics are predominantly driven by the gate fees charged, rather than the value of the end product (compost). The TEG process is an economic alternative to landfill.
The Silo Cage system, one of the few technologies in Europe capable of treating this waste, is a natural process producing compost as an end product. The compost is an excellent soil conditioner that fertilises, retains moisture, provides structure and reduces the incidence of plant disease. TEG's Silo-Cages are housed in self-contained buildings, are not unsightly and are environmentally friendly.
Customers include local authorities, waste management companies, food processors, farmers and landowners. The Company's expanding market is driven by increasingly stringent EU and UK legislation regulating the treatment and disposal of organic waste. Statutory targets for the diversion of waste from landfill increase annually through to 2020, increasing TEG's market opportunity year on year. The Waste Resource Action Programme estimates that 450 composting plants will be needed by 2020 to satisfy local authority requirements alone, and there is increasing demand from the private sector driven by ABP legislation.
NOFCO, a subsidiary of TEG, is a marketing company specialising in the development of end markets for compost products, an important aspect of all plant developments and key to local authority development. The company has an expertise in the development of agricultural and horticultural markets and this capability is to be provided to customers to enhance TEG's overall service offering.