For the second time in six weeks, Cleanaway Waste Management has been forced to reveal a profit downgrade because of events beyond its control.
In early May the company told the ASX that its June 30 financial year earnings could be up to $20 million lower than previously expected because of sharp increases in fuel costs, disruptions from floods on the eastern seaboard, and labour shortages.
On Thursday, the company revealed that there could be a multi-million dollar impact from a fire at its medical waste processing facility in Dandenong, Victoria.
Cleanaway said the blaze “has caused significant damage to the equipment at the site. As a result, the operations of the Health Services business unit in Victoria will be disrupted for a period of time.”
“No Cleanaway staff or contractors at the site were injured in the fire. We understand that there has not been any environmental damage from the fire and all firewater was contained on the site,” the company told the ASX.
“Cleanaway is currently exploring alternative disposal pathways to treat and dispose of the medical waste that would otherwise be processed at the site, including temporary licence approvals to treat and dispose of waste at other Cleanaway facilities and disposal with third parties. Cleanaway will work with affected customers to minimise disruption to their service.
“Cleanaway’s preliminary estimate of the impact of the disruption to service is a reduction in EBITDA for the Health Services business unit of approximately $2-3m per month. Further information in relation to the financial impact of the disruption, including its expected duration, will be provided in due course. “
Cleanaway shares dropped 1.7% to $2.84. That’s the lowest they have been since mid-March.
