Putting secondary
materials first
Renewi plc Annual Report and Accounts 2023
We are
Renewi
We are a waste-to-product company
and a leader in sustainability, operating
at the heart of the circular economy. As
pure-play recyclers, our core purpose is
to give new life to used materials.
Every day we help our customers
progress towards their net-zero emission
goals. We do this by creating secondary
materials with a lower carbon footprint
than the primary resources they replace.
We help our customers help the planet.
What we do matters
The world has realised the transition to
clean energy alone is not enough to
meet the climate challenges we face.
Circular economies, through resource
preservation and reduced reliance on
incineration and landfill, play a vital role
in slowing climate change.
Building on a legacy of more than
100 years, the work we do at Renewi
brings us one step closer to a cleaner,
more sustainable world.
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Cover image: Plastic recyclate. Photography: Thomas van Shaik. Styling: Eddy Frings.
Secondary materials photography by Thomas van Schaik, styling by Eddy Frings. Employee photography by
Twycer and Tom Doms. Site photography by Epsilon Studios and Exstatic.
CONTENTS
Strategic report
Group overview .............................................................................. 6
Our progress this year ..................................................................10
Measuring our performance .......................................................12
A message from the Chairman ..................................................14
The world we live in .....................................................................16
Why Renewi is well positioned ..................................................20
What we do: converting waste to product...............................22
Who we do it for: our customers ...............................................24
Business model ............................................................................26
A solid investment in the circular economy ............................28
CEO’s strategic review ..................................................................30
CFO’s financial review ..................................................................36
Value driver: circular innovations ..............................................42
Value driver: Renewi 2.0 ..............................................................46
Value driver: M&W recovery ........................................................48
Enable the circular economy .....................................................50
Reduce our carbon emissions ...................................................54
Climate-related Financial Disclosures (TCFD) ........................59
Care for people .............................................................................66
Operating review ..........................................................................72
Risk management ........................................................................86
Viability statement .................................................................... 100
S172 summary ........................................................................... 102
Non-financial information statement ................................... 103
Governance report
The Board of Directors ............................................................. 106
The Executive Committee ........................................................ 108
Governance at a glance ............................................................ 110
Corporate Governance Report ............................................... 112
Safety, Health and Environment Committee Report ......... 130
Audit Committee Report .......................................................... 132
Nomination Committee Report .............................................. 137
Directors’ Remuneration Report ............................................ 140
Other disclosures ...................................................................... 158
Directors’ responsibilities statement ..................................... 161
Financial statements
Auditor’s Report ......................................................................... 164
Financial statements ................................................................ 172
Other information
Shareholder information ......................................................... 262
Non-financial statement .......................................................... 263
Company information .............................................................. 265
Glossary ....................................................................................... 266
Secondary material
Commercial Waste NL, compost
made from organic waste material,
used to fertilize and enrich soil
STRATEGIC
REPORT
Secondary material
Maltha, Glass powder made from
processed glass, used for a powder
in the batch recipe for furnaces
6
Group
overview
Renewi operates in the Netherlands, Belgium, United Kingdom, France
and Portugal, across three business Divisions, as outlined below.
Our Divisions
Renewi in numbers
COMMERCIAL WASTE
Comprises industrial and
commercial waste collection,
processing and secondary
materials production across
the Netherlands and Belgium.
Key activities include the
processing of mixed waste
streams and monostreams
into high-quality recyclates
and organic waste into
biogas.
page 72
MINERALZ & WATER
(M&W)
Comprises our Mineralz
activities of processing and
cleaning contaminated soil
and tar and turning it into
building products like gravel,
sand and filler. It also
includes cleaning of bottom
ash and fly ash and cleaning
of contaminated water and
packed chemical waste
processing activities.
page 78
SPECIALITIES
Comprises three businesses:
Maltha glass recycling,
Coolrec – our specialist Waste
Electrical and Electronic
Equipment (WEEE) recycling
business and UK Municipal
public-private partnership
(PPI) contracts. This Division
operates in Belgium, the
Netherlands, the UK, France
and Portugal.
page 82
154
operating sites
6,714
employees at year-end
11mT
of waste handled each year
63.6%
recycling rate for FY23
new reporting methodology
€66.6m
of statutory profit
€132.9m
underlying EBIT
1988
listed on the London Stock
Exchange, and Euronext
Amsterdam in 2020
Renewi plcAnnual Report and Accounts 2023 7
Financial Shared
Services Centre
Lommel
Strategic reportGovernance reportFinancial statementsOther information 8
Group overview CONTINUED
Our purpose drives
our strategy
Our purpose
Our vision
To protect the world by giving new
life to used materials.
To be the leading waste-to-product
company in Europe’s most advanced
circular economies.
Our strategy
Leader in
recycling
Leading
waste-to-
product
company
Selectively grow
market share
Leader in
secondary
materials
production
Alignment to UN SDGs
Renewi plcAnnual Report and Accounts 2023 9
Our value drivers
Sustainability themes
Our values
Who we are
Safe
Safety above all else
Circular innovations
Enable the circular economy
page 42
page 50
Sustainable
Make a daily difference to our planet
M&W recovery
page 48
Reduce our carbon emissions
page 54
Innovative
Do it better every day
How we act
Accountable
Do what we say we’ll do
Customer-focused
Add value for our customers
Renewi 2.0
page 46
Care for people
page 66
Together
Always open and respectful
Strategic reportGovernance reportFinancial statementsOther information
10
Our progress
this year
In FY23 Renewi has made notable
progress on its objectives, supported
by significant developments.
€30m
Deployed into our circular
innovations pipeline.
We doubled the
volume of
mattresses we are
helping to recycle,
announcing a
further 1.5m will be
recycled in the UK in
addition to the 1.5m
in Belgium and the
Netherlands,
supported by our
investment in
Retourmatras.
We appointed Katleen
Vandeweyer as Non-Executive
Director, Chair of the Audit
Committee and member of
the Nomination Committee.
page 119
Coolrec (a part of our Specialities Division) and Playmobil
partnered to deliver high-quality recycled plastic for the toy
maker’s award-winning recycled Wiltopia range.
Read more about this partnership on page 85
€132.9m
Underlying EBIT decreased
1% to €132.9m.
(FY22: € 133.6m), on revenue of €1.9bn (FY22: €1.9bn)
Renewi plcAnnual Report and Accounts 2023 11
63.6%
Recycling rate increased to 63.6%.
FY22: 61.8% - new restated baseline
We continued to
progress our Renewi 2.0
programme, resulting
in 100,000+ activated
MyRenewi users and
295,000 orders placed
through MyRenewi.
In the Netherlands, we completed the acquisition of
Renewi Westpoort from Paro, strengthening our position
in the construction and demolition industry. We
progressed the construction of our new plastics sorting
line in Acht, with the aim to commission in FY24.
page 75
8.4m km
Our shared bio-LNG facility with Nordsol,
which operates using organic waste
processed by Renewi, has enabled 8.4m km
of sustainable journeys.
Belgium’s largest wind turbine on
land installed on our site in Ghent.
page 53
€5m+
Investment to increase volume and quality
of glass recyclates in our Maltha business.
In Belgium, as part of our investment of over €60m to support customer
compliance, we responded to VLAREMA 8 legislation by building and
commissioning our advanced sorting line for residual waste in Ghent.
Strategic reportGovernance reportFinancial statementsOther information 12
Measuring our
performance
Below is a summary of our financial and non-financial
performance. Progress has been made in FY23 and we will
continue to build on this in FY24.
Financial
REVENUE (€M)
UNDERLYING EBIT (€M)
STATUTORY PROFIT (€M)
€1,892.3m
€132.9m
€66.6m
Overall revenues up 1% in the year as
outbound revenues increase, reflecting the
record high recyclate prices in the first half
of the year and increased recyclate quality.
Inbound revenues declined reflecting lower
volumes offset by strong price discipline.
Underlying EBIT and margin in line with
prior year despite lower inbound volumes,
reflecting pricing discipline, ongoing cost
control and Renewi 2.0 cost saving actions
mitigating inflationary increases.
Statutory profit remains strong but has
reduced year on year, mainly driven by an
increase in the effective tax rate.
FY23
FY22
FY21
1,892
1,869
1,693
FY23
FY22
FY21
132.9
133.6
FY23
FY22
66.6m
75.4m
73.0
FY21
5.5m
UNDERLYING EPS (CENTS)
RETURN ON CAPITAL EMPLOYED
(%)
LEVERAGE RATIO
90cents
10.6%
1.83
Underlying EPS fell year on year driven by
the higher effective tax rate.
ROCE has fallen year on year, driven by the
investment in our innovation growth
portfolio which will deliver improved EBIT as
the projects progress. Capital expenditure
on growth projects will increase further in
the coming year, while spend on
replacement projects will remain under tight
control.
Due to investment in our growth projects
and the acquisition of Renewi Westpoort
from Paro our core net debt increased in the
year, while profits remained stable. Leverage
ended well below the Board’s target of 2.0x.
FY23
FY22
FY21
90
98
45
FY23
FY22
FY21
10.6
11.6
6.3
FY23
FY22
FY21
1.83
1.44
2.24
The definition and rationale for the use of non-International Financial Reporting Standards (IFRS) measures are shown in note 8.3 to the consolidated financial statements.
Renewi plcAnnual Report and Accounts 2023 Non-Financial
13
RECYCLING RATE (%)
63.6%
CARBON AVOIDANCE
(KG CO2 PER TONNE)
233
After a comprehensive review of our
methodologies and recycling rate reporting
framework, our industry-leading recycling
rate for FY22 was restated to 61.8%. In FY23,
our recycling rate has increased to 63.6%.
The update of our reporting framework also
resulted in a restatement of our FY22
baseline of our total carbon avoidance.
Our restated carbon avoidance per tonne of
waste handled in FY22 was 225 kg of CO2/T.
In FY23 it has increased to 233.
FY23
FY22
63.6%
61.8%
FY23
FY22
233
225
ABSOLUTE CARBON
FOOTPRINT SCOPE 1&2 (T)
CARBON INTENSITY FROM
COLLECTION (KG CO2 PER TONNE)
CARBON INTENSITY FROM
PROCESSING (KG CO2 PER TONNE)
580kT
18.8
7.50
We have already delivered a 9% decrease in
our scope 1&2 carbon emissions. Our goal is
to reduce these by 50% by 2030.
We are reducing our carbon footprint in the
collection of waste by increasing route
efficiency, fuel and driver efficiency and the
electrification of our fleets.
We are making progress in lowering our
on-site carbon emissions KPI by reducing
energy consumption, increasing our own
production of renewable energy and by
prioritising the purchase of renewable
electricity.
FY23
FY22
580
640
FY23
FY22
18.8
20.1
FY23
FY22
7.50
7.56
LOST TIME INJURY RATE (LTIF)
(NUMBER OF LTI/ TOTAL NUMBER OF WORKING
HOURS)X 1,000,000 HOURS)
EMPLOYEE ENGAGEMENT
(eNPS SCORE IN PULSE SURVEY)
WOMEN IN LEADERSHIP (%)
9.3
+24
24%
The number of LTIF increased slightly this
year, from 8.9 to 9.3. Safety is our number
one priority, and we are unconditionally
committed to improving our safety culture,
with a strong emphasis on safety leadership.
We are focused on positioning Renewi as a
leading company to work for in the circular
economy. We have conducted three Pulse
surveys this year, and our eNPS score has
increased from 18 to 24, with a target of 30
by 2025.
We are making good progress with our
Diversity and Inclusion strategy and have
seen a two-point increase of women in
leadership positions this year, to 24%,
moving closer to our 30% target.
FY23
FY22
9.3
8.9
FY23
FY22
+24
+18
FY23
FY22
24
22
Strategic reportGovernance reportFinancial statementsOther information 14
A message from
the Chairman
I am pleased to report that Renewi has had another successful year.
Our purpose to turn used materials into products is more relevant
than ever, illustrated by exciting new partnerships that strengthen
our market-leading position. We have continued to deliver on our
strategy while adapting for the future.
Renewi has performed very well in FY23,
showing itself to be strong and resilient in
the face of considerable macroeconomic
challenges. Our unifying purpose is giving
new life to used materials and this is what
drives us. We have maintained a steadfast
commitment to the circular economy,
focusing on innovation in our services and
products in order to increase recycling
rates and further improve the quality of
our products.
OUR PEOPLE DRIVE
OUR SUCCESS
Our people have once again worked with
passion and dedication. We have met our
objectives, served our customers and
worked tirelessly to keep each other safe.
I would like to thank them all for their
energy, skill, determination and
togetherness. I would also like to thank our
customers, suppliers, investors and other
key stakeholders who make Renewi the
leading waste-to-product company it is.
The safety of our people is our number
one priority. We were devastated by the
death of a colleague due to an accident at
our Amsterdam Westpoort site in
December 2022, one we had acquired a
few months before. At Renewi, safety is our
number one value and this accident
further reinforced our unconditional
commitment to bring safety to the highest
levels and to do our utmost to prevent any
future serious incidents. Improving our
safety culture continued to be a key area of
focus throughout the year, with a strong
emphasis on safety leadership. We are in
the process of implementing the
International Sustainability Rating System
(ISRS), which includes a comprehensive
safety approach, across the entire
company.
We can only achieve our purpose and
values if we work together as a team, in a
respectful and diverse environment. We
value the benefits of diversity at both Board
level and across the whole organisation. We
are making good progress with our Diversity
and Inclusion strategy, moving closer to our
target of having 30% of our senior
leadership positions held by women.
OUR CUSTOMERS ARE AT THE
HEART OF OUR BUSINESS
Supply chain issues, widespread inflation
and increased energy costs are just some of
the current issues affecting businesses
everywhere, in both the long and short term.
Our markets are evolving
rapidly and we are
attuned to the
associated opportunities
and challenges
Renewi provides an essential service, and
this gives us resilience. We remain dedicated
and committed to our customers and we are
pleased to see strong customer loyalty,
despite socio-economic challenges.
We have increased our focus on improving
our customer experience with our Renewi
2.0 programme, enhancing our customer
service and our efficiency through a
programme of digitisation. We now offer
customers 24/7 access to our systems via a
user-friendly app where they can quickly
place orders for our services. This has
resulted in customer growth and an
improved Net promoter score (NPS), from a
baseline 3 to 18.
DELIVERING ON OUR STRATEGY
Leader in recycling
We have achieved significant milestones in
executing the three pillars of our strategy.
We have invested in further increasing our
market-leading recycling rate and we are
making good progress towards our 75%
target, with 7mT of materials put back into
re-use. This has been driven by a strong
focus on innovation and better sorting,
ensuring continuous improvement in our
recycling processes across all divisions.
Leader in secondary material production
On the product side we have improved the
quality of our output for various material
streams, including glass, sand, wood and
plastics. A particular highlight was achieved
with plastics, where we demonstrated we
are consistently producing a quality product
from recycled fridges at the highest
standards, culminating in the partnership
with toymaker Playmobil.
Increase market share
Finally, our acquisition of Renewi Westpoort
(formerly Paro) has laid a strong foundation
for further growth in the construction
and demolition market, one of our core
market segments.
EPS AND DIVIDEND
Financial highlights included a revenue of
€1.9bn and a statutory profit of €67m. Core
debt increased to €371m (FY22: €303m) due
to the acquisition of Renewi Westpoort.
Recognising the Group’s significant growth
investment programme and the resultant
cash flow profile in the short term, the Board
is not recommending a dividend for FY23.
However, given our positive outlook for our
cash flow in the coming years, the Board
intends to reinstate a progressive dividend
for FY24 onwards.
CORPORATE GOVERNANCE
The Board continues to aim for the highest
standards of corporate governance. Details
of our policies and procedures, including
those relating to the role and effectiveness
Renewi plcAnnual Report and Accounts 2023 15
of the Board and compliance with the UK
Corporate Governance Code, are set out in
the Governance section on pages 116 to 120.
We were very pleased to meet again in
person and to welcome Katleen Vandeweyer
and Annemieke den Otter to the Board.
LOOKING AHEAD
Renewi has had another strong year with
continued strategic progress in core
markets, buoyed by favourable legislation
and increasing demand for recycled
materials. With the macroeconomic outlook
becoming more certain, accompanied by
strong customer loyalty, we look to the
future with full confidence. We have
successfully navigated a number of unique
challenges, including high inflation and
labour shortages, and have maintained
revenues and margins in spite of a
normalisation in recyclate prices.
Renewi remains well positioned to benefit
from the adoption of circularity by European
economies – the bedrock of our business
model is the circular economy, and
our end markets continue to grow, with
corporate strategies supporting increased
recycling and demand for high-quality
secondary materials.
Ben Verwaayen
Chairman
Strategic reportGovernance reportFinancial statementsOther information 16
The world
we live in
Consumption levels are higher than ever, and we use more
resources than our planet can sustain. Keeping it habitable
requires decarbonisation which can only be achieved through
circular economies and waste management. We are still at the
beginning of this crucial journey, with both challenges and
valuable opportunities ahead.
Short-term trends
Navigating an increasingly
volatile environment
Economic activity impacted by
geopolitical tensions and monetary
policy change
Widespread inflation
Higher competition for waste
volumes
Recyclate prices reverting closer to
trend levels
European Union pushes circular
economy agenda
Advanced waste sorting legislation
in Flanders
Latest IPCC report flagging once
more the urgency to accelerate the
process in reducing GHG emissions
Inflation, cost of living, the war in
Ukraine, the energy crisis and supply
issues have had a global impact on
companies and customers. Like many
other businesses, we have experienced
a shift in the price and availability of
materials. Inflation has impacted living
costs for our employees. The cost of
energy used in our waste collection and
processing activities has increased too.
Despite this, Renewi remains confident
and has an open dialogue with both
customers and employees, which allows
us to proactively address any challenges.
Renewi provides an essential service
There is nothing discretionary about the
collection and processing of waste. The
value we offer and our large customer base
has helped reduce the impact of short-term
issues. The requirements of customers for
recycled products are becoming more
stringent as their sustainability goals evolve,
alongside more progressive legislation.
We have solid mitigating actions
We are passing on costs to our
customers, and we are frugal as a
company, watching our outlays so
we can continue to invest in growth
opportunities. We balance our portfolio
so our success does not fluctuate with
economic activity.
While the environment has been
turbulent, fundamentally, wider society
is becoming increasingly mindful of the
importance of reusing materials, and
this awareness has risen despite
adverse macroeconomic events.
Renewi’s business model is fit for the
future. By increasing the availability
of secondary materials, we help
companies have a better grip on
materials sourcing. In addition, our
purpose helps us navigate the labour
shortage: people are joining Renewi
because of our positive impact on the
planet and society.
Recycled wood used for biomass
and as a secondary material
for panel manufacturing
70%
Global increase in solid
waste generation by 2050
70%Greenhouse gas emissions linked to
material handling and use
Circularity Gap Report 2022
Renewi plcAnnual Report and Accounts 2023 17
Long-term trends
Long-term trends remain favourable
Recycling is stimulated by European
Union and Benelux regulation
Demand for recycled
materials is growing
Alternatives like incineration face
increasing taxation and prohibitions
Recycling enables European Union
to be more self sufficient
A growing focus on carbon
emissions accounting (from both
regulation and customer requests)
Optical sorting
line, Maltha,
Lommel
European Union and national
government policies
Regulation to eliminate landfill and reduce
incineration is gathering pace, while new
rules aim to increase recycling and re-use.
Furthermore, they demand secondary
materials and cleaner cities, foster
responsible production and encourage
circularity throughout the economy.
more responsible production of materials.
This frequently involves the inclusion of
secondary materials in their processes to
help meet their ESG targets. At the same
time the international corporate regulatory
frameworks are becoming stricter on GHG
accounting, making full carbon footprint
scope 1, 2 and 3 disclosure and overview of
carbon reduction roadmaps mandatory.
Corporates
There is a growing focus on environmental,
social and governance (ESG) criteria
throughout advanced economies, and
businesses are increasingly committing to
Governments
A shift by governments towards a
sustainable future is evidenced by various
new targets. For example, those agreed at
the UN’s COP27 gathering in November 2022
and also, the ambitious 2050 European
Union circular action agenda.
Consumer awareness
Increasingly consumers want to engage
with businesses that conduct themselves
sustainably and are demanding responsible
production from the businesses they use.
Growing markets
for recyclates
The demand for recyclates is increasing
alongside opportunities to produce high-
value secondary materials that can compete
with virgin materials on price and quality.
Material use in the European Union (in mT)
190
2,100
183
1,860
4%
Wood
11%
Mineral
58
41
29%
114
41
64%
75
21
72%
37
10
73%
Plastic
Metals
Paper,
Cardboard
Glass
Upside potential
Recycled content
Sources: European Union list of critical materials, EC Plastics Strategy Factsheet, Eurostat, JRC Science for Policy Reports, cepi.org
Strategic reportGovernance reportFinancial statementsOther information Financial Shared
Services Centre,
Lommel
Quality testing polystyrene
from recycled fridges at our
Coolrec laboratory in Waalwijk,
used in new fridges and
Playmobil’s Wiltopia range
18
The world we live in CONTINUED
50%
Reduction in material footprint
from 2015 to 2030
Ambition for European Union Taxonomy on a Circular
Economy
60%
Increase in municipal waste re-use
and recycling by 2030
Waste Framework Directive
25%
Share of recycled content needs
to shift from 48% to 60% from
2020 to 2030
European Union Taxonomy on a Circular Economy
70%
Packaging should be made from 70%
recycled materials by 2030
Packaging Directive
Renewi plcAnnual Report and Accounts 2023 19
Advanced circular economies
Key
Very low
Low
Low–Medium
Medium
Medium–High
High
THE WORLD IS EVOLVING
Operating in the world’s most advanced
circular economies
The Netherlands and Belgium are two
of the world’s most advanced circular
economies, leading the way in climate
change mitigation.
As many countries, particularly in Europe,
look to adopt the same technologies and
solutions against a backdrop of mounting
political pressure and increasing consumer
demand, this gives Renewi the opportunity
to scale solutions beyond the countries in
which we currently operate.
100%
The Netherlands will
be 100% circular by 2050
The Netherlands government
A desire for change
With the shift in understanding of the
importance of circularity and achieving
net-zero, we have noticed some wider
societal changes.
• A shift from virgin materials to used
materials with a correlating swing from
high to low emissions, as more companies
commit to the use of recycled materials
and target net-zero emissions
• An accelerating transition from
incineration and landfill towards recycling
• A persistent legislative push by
governments stimulating circular
behaviour through new policies,
directives, decrees, bans, incentives
and taxation
• Increasing environmental standards which
require more advanced recycling
technology and processes
However, there are constraints in place which
are hindering our transition to a global circular
economy. To tackle these, we need to:
• redesign value chains;
• align circularity with business interests;
• step up the promotion of circular
behaviour; and
• design effective policies and accelerate
certification and permitting processes.
European Union member states are already
addressing bottlenecks, such as Belgium’s
implementation of VLAREMA 8, which bans
the incineration of unsorted residual waste.
We need to see progressive legislation like
this in more countries.
Each step and each push towards circularity
– big or small – offers Renewi an opportunity
to progress on its mission and capture
additional growth.
Read more about how our new
sorting lines are helping customers
comply with VLAREMA 8 on page 77
Strategic reportGovernance reportFinancial statementsOther information 20
Why Renewi
is well positioned
With people, companies and governments placing
greater emphasis on tackling climate change, Renewi’s
position and the role we play in the circular economy
has become increasingly important.
OUR UNIQUE WASTE-TO-
PRODUCT STRATEGY
At Renewi, we focus on secondary material
production through innovation, technology
and partnerships. This focus is leading to the
creation of higher-quality secondary
materials, which are becoming increasingly
appealing for businesses who want to
reduce their impact on the planet. We
offer innovative processes for recycling
a diverse range of products and materials,
from plastics and mattresses to asbestos-
contaminated steel and orange peels.
We deliver higher-value solutions too, for
example bio-LNG and biogas to grid rather
than electricity generation.
We do not own incinerators and benefit
financially from diverting waste to avoid
incineration costs. Importantly, the
environment benefits too. At 63.6%, we
believe our recycling rates are leading
internationally, and we aim to further
increase this position. This year, we have
sharpened our recycling rate reporting
methodology framework and baseline to
ensure compliance with latest international
standards and guidelines. Our ambition to
achieve a 75% recycling rate and beyond –
Mission75 – still remains. The target year for
reaching 75% will be confirmed during next
year. Our activities avoid 2.5mT CO2 each year
by putting 7mT of materials back into re-use,
tangibly contributing to the circular economy.
For years, Renewi has worked with a
network of innovative customers and
partners to provide closed-loop circular
solutions. We also work with universities,
entrepreneurs and other corporates, across
multiple models, including direct
investment, co-investment in joint ventures
and logistics support.
OUR MARKET POSITION
We have the number-one position in our
markets, handling: 11mT of waste, a fleet of
circa 2,000 trucks and around 0.5 million
bins and containers across 154 sites, and we
own the waste.
Our major processing sites are well-known
hubs for converting waste into secondary
materials. This makes us the partner of
choice for large companies to source
secondary materials, including global
companies and large businesses from most
European industrial sectors.
OUR ROLE IN THE
CIRCULAR ECONOMY
We believe businesses have both the power
and responsibility to help manage our
planet’s resources. At Renewi, we operate at
the heart of the circular economy and are
uniquely positioned to drive environmental
leadership, address challenges and turn them
into business opportunities. By doing so, we
aim to deliver a purpose-led positive impact
for people and the planet.
Our aim is to recycle more and better, so that
one day we can replace virgin materials.
We are building a company that is:
• serious about sustainable, long-term growth;
• caring and concerned for our people’s safety
and wellbeing;
• geared to deliver attractive returns; and
• best-in-class for ESG performance.
Waste and the circular economy
1
Waste producer
Renewi experts advise
companies on how they
can generate less
residual waste.
Manufacturing
We collaborate with
manufacturers to source
and design feedstocks to
make secondary
products.
Refine
secondary materials
At our specialist facilities
we refine products to
exacting customer
specifications.
The typical
focus of
most waste
companies
Incineration
Landfill
Collection
Our fleet comprises
zero- and low-emission
trucks. We optimise
routes to reduce
emissions and fuel use.
The circular
economy
drives our
business
model
Sorting
and processing
We use technology such
as optical sorting lines
to segregate recycling
materials for further use.
Avoid
disposal
We seek to avoid
sending waste to
landfill.
Renewi plcAnnual Report and Accounts 2023 21
Secondary material
M&W, Gravel mix. Polluted soil and
tar is processed into gravel, sand
and filler for the concrete industry
Strategic reportGovernance reportFinancial statementsOther information 22
What we do:
converting waste to product
As a pure-play recycling
company, we generate
revenue by converting
the waste we collect into
secondary materials,
which we sell to our
customers. Unlike many
of our competitors, who
typically draw revenue
from the incineration
of waste, our activities
generate revenue while
contributing to a circular
economy.
We process a broad range of
materials, with the aim of
giving them a second life
wherever possible. We aim
to achieve a recycling rate of
75% – we call this Mission75.
Today, our recycling rate
is 63.6%.
We have outlined the vast
majority of the waste we
process and the new
materials we create.
RENEWI ACTIVITIES
BY SCALE
Commercial Waste
Mineralz & Water
Specialities
Maltha
Coolrec
Municipal
Based on FY23 full year
output volume data
RENEWI ACTIVITIES
MATERIALS TYPE
Commercial
Waste
6,697,000T
Mineralz
&
Water
1,933,000T
Specialities
Maltha
1,307,000T
Coolrec
120,000T
Municipal
904,000T
Process losses
204,000T
Glass
1,124,000T
Wood
786,000T
Paper
650,000T
Metals
278,000T
Plastics
119,000T
Other recyclates
and PMD
96,000T
Minerals
2,633,000T
Electronics (WEEE)
63,000T
Organic matter
597,000T
Hazardous waste
295,000T
Treated wastewater
1,053,000T
Other mixed and non
hazardous waste
2,508,000 T
Disposal
757,000T
Renewi plcAnnual Report and Accounts 2023 23
DESTINATION
SECOND LIFE OF MATERIALS
Recyclates
6,975,000T
Waste-derived
fuels
1,140,000T
Energy from
waste
2,088,000T
New life of materials
We distinguish two types of
recyclates: materials that have
reached end-of-waste status and
can go back into the production
process, and our recyclates that we
hand to other parties for further
processing before they go back into
production processes.
Recovery of energy
Only when legislation or technology
advancements stop us from turning
waste into secondary materials do
we turn waste into energy. This way
we still make the most of the value in
this waste.
Disposal
Disposal
We aim to recover and process as
much of our inputs to the highest
quality we can. This is why we treat
disposal – landfilling and combustion
without energy recovery – as a loss in
process and only resort to this when
absolutely necessary.
Strategic reportGovernance reportFinancial statementsOther information 24
Who we do it for:
our customers
Our 150,000+ customers underpin our success
and understand the value of waste management
in the creation of a circular economy.
Innovation is the glue that holds us
together. Every day, we work with our
customers to create new solutions to
support their sustainability goals, while
responding to demands for continually
higher quality secondary materials for
use in increasingly demanding
applications. This might be through the
management and collection of waste or
the creation of new technologies,
processes and materials. Sustainability
runs through our core, so we can
facilitate the reduction of carbon
emissions for both our customers and
their value chains.
Technology plays an important role in
improving our interactions with our
customers. The development of our Renewi
2.0 programme, which includes the
optimisation of Renewi’s customer journey,
resulted in improved customer satisfaction.
(Read more about Renewi 2.0 on page 46).
On the site floors, we have also invested in
state-of-the-art sorting technology to
improve yield (recovery rate) and purity. For
example, we have upgraded the plastics at
Coolrec and our Ghent and Acht facilities,
and improved the wood sorting at our
Nieuwegein facility.
We place our diverse and robust portfolio of
customers into two groups, waste-
producing and product customers. (Read
more about how and why we engage with
our customers on page 122.)
WASTE-PRODUCING CUSTOMERS
We have dedicated focus teams for our
customer groups across healthcare,
Customer segments based on revenue – Commercial Waste
SME
Large Accounts
Domestic
Output Revenue
Other
25%
23%
22%
14%
16%
For information on our waste streams, see our waste-flow diagram on page 22
industry, construction and other services.
Our diverse client base comprises SMEs,
multinationals and local and national
governments.
Our customers receive tailor-made solutions
to support their waste management
requirements, with input from our Material
Support Officers and Sales Engineers. In the
construction and demolition segment, for
example, we are developing our circular
construction site offering that includes
improvements to help sort waste at the
source, enabling customers to increase
recycling rates.
Most importantly, our expertise means we can
process any waste stream, thereby acting as a
one-stop-shop for customers nationwide.
PRODUCT CUSTOMERS
Providing our customers with innovative
solutions and high-quality secondary raw
materials entails creativity and selectivity,
Renewi plcAnnual Report and Accounts 2023 25
Medical waste, Commercial
Waste BE, Seraing
particularly in light of increasing regulation
and certification, such as the International
Sustianability & Carbon Certification
covering the supply chain.
The scale of our business means we can
provide our customers with security of
supply, and our market-leading knowledge
and expertise surrounding waste materials
and their processing enables us to easily
adapt to their specific needs and
expectations.
This year our customer portfolio has
expanded. Typical examples of customers
within these groups include paper mills,
cardboard and corrugated carton producers,
steel mills and blast furnaces, plastic
compounders and moulders, chipboard and
fibreboard producers, and concrete and
construction producers. A notable highlight
is our pioneering partnership with
Playmobil. This collaboration saw Coolrec
provide recycled plastic for the creation of
Playmobil’s Toy of the Year-winning Wiltopia
range, which is composed of more than 80%
sustainable materials.
Long-term partnerships
Renewi operates many long-term
engagements with customers and partners.
Johannes Naumann, BioLNG Business
Development Lead at Shell, on the value of
our relationship: “Supporting the reduction
of greenhouse gases in our products and
services is a key part of our strategy, which
Renewi helps support through its supply of
biogas to Nordsol, producers of bio-LNG.
Through this collaboration, since February
2022 we have been able to deliver a
CO2-equivalent reduction of roughly 30% to
all customers who fuel up with Shell BioLNG
blend in the Dutch Shell LNG network. In
turn, this helps our customers reach their
own ambitions set for 2030 with regards to
emission reductions.”
Helping the Belgian Federal
Government towards net-zero
healthcare by 2050
The healthcare sector is a significant
part of our customer base, and we are
helping the Belgian Federal
Government meet its COP26
commitment to having a net-zero
healthcare system by 2050. We are
part of a voluntary programme
for the recycling of non-risk medical
PVC consumables (such as tubing,
masks and IV sets) into healthcare
products with a longer lifespan, such
as floor and wall coverings and rehab
products. This cross-value-chain
collaboration brings together Renewi,
our partner Raff Plastics and
VinylPlus®, the European PVC
industry’s commitment to sustainable
development. Co-ordinated by
VinylPlus, Raff Plastics processes the
PVC materials and turns them into
high-quality and regulatory-
compliant recyclates. Renewi
provides logistical support for the
collection and transport of waste.
Strategic reportGovernance reportFinancial statementsOther information 26
Business model: creating
value for our stakeholders
We consider our stakeholders in every decision we make.
Our purpose and vision lead our strategy. Our ultimate
aim is to benefit our stakeholders and wider society.
Led by
Taking into account
What we do
We generate revenue from collecting,
sorting and treating waste and by selling
the recyclates and secondary materials we
produce. Our focus is downstream of the
value chain in line with market value – from
collection to recycling and other processing
treatments. We plan to deliver more and
higher-quality secondary raw materials and
biofuels. This focus on creating products
from waste differentiates us from many
large competitors, who typically draw
revenues from incineration activities.
Page 22
OUR PURPOSE
To protect the world
by giving new life
to used materials
OUR VISION
To be the leading
waste-to-product
company in Europe’s
most advanced circular
economies
WHAT WE DO MATTERS
Climate change is the key issue
of our times; the circular economy
is a vital part of the solution
Page 20
OUR DIVISIONS
Our people, investments, innovation
and technology are all essential
to our business
Page 6
ENGAGING WITH
OUR STAKEHOLDERS
We encourage feedback from all our
stakeholders, so we can evolve,
strengthen and grow our business
Page 121
Renewi plcAnnual Report and Accounts 2023
27
Creating value at the heart of the circular economy
Driven by
OUR STRATEGY
Leader in
recycling
Leading
waste-to-
product
company
Selectively grow
market share
Leader in
secondary
materials
production
VALUE DRIVERS
2.0
M&W recovery
Renewi 2.0
Circular
innovations
Page 42
OUR SUSTAINABILITY THEMES
Enable the
circular
economy
Reduce
our carbon
emissions
Care for
people
Page 50
For all stakeholders
Aligned to the UN SDGs
We regularly engage with our
stakeholders and remain responsive
to their feedback so that we can
continually address key issues,
add value and resolve any problems,
these include:
• Waste-producing customers
• Product customers
• Suppliers
• Innovation partners
• Government
• Regulators
• Employees
• Global communities
• Lenders
• Shareholders
• Local communities
Pages 121 to 128
63.6%
Recycling rate
2.5mT
Total carbon avoidance
24eNPS
Employee engagement score
Strategic reportGovernance reportFinancial statementsOther information
28
A solid investment in
the circular economy
Circularity is at the heart of everything we do, and as the
progressive economies recognise its value, our expertise and
innovation are perfectly placed for a low-carbon future.
1
FAVOURABLE
LEGISLATION
Climate mitigation and circularity have been key
elements of our strategy from the start. As a pure-play
recycler, we seek to avoid incineration and landfill,
converting waste that can be turned into new,
low-emission materials. Increasingly, legislation is
promoting circular behaviour and tailwinds.
Read more
about our
strategy on
page 20
2
A MARKET
LEADER
Renewi holds market leading positions. It is not just
the volume of waste we handle – when this is
combined with our carbon avoidance and leading
recycling rate, our market position means we make a
tangible, positive impact on our environment.
Find more
detail on our
market
position
on page 20
3
CUSTOMER
COLLABORATION
We work hard to form lasting relationships with our
150,000+ customers; relationships which benefit us all
through the use and promotion of secondary
materials. Our collaborations develop new, innovative
solutions that enable customers and partners to meet
their waste management requirements and
sustainability targets.
Read more
about our
partnership
with Playmobil
on page 85
4
INVESTING IN
INNOVATION
Our progress is underpinned by our investment in
technology and innovation, meaning we can continue
to offer our customers the solutions they need. We are
focused on optimising the quality of our recyclates to
increase their use in favour of virgin materials. To date,
we have invested €60m, with another €30m in FY24.
Read more
about where
our capital is
deployed
on page 42
5
A SKILLED AND
DEDICATED
WORKFORCE
We have over 6,500 employees, each taking pride in
their role at Renewi and the shared drive to make our
world cleaner and greener. The ethos of our skilled
and dedicated engineers, mechanics, truck drivers and
everyone else at Renewi keeps our customers cared
for and our business strong.
Read more
about our
workforce
on page 66
Renewi plcAnnual Report and Accounts 2023 29
Secondary material
Coolrec, Coolstar Fridge
granulates, recycled into new
fridges and children’s toys
6
STRONG ESG
PERFORMANCE
Our ESG performance
83/100
Advanced level
This is reflected in our strong ESG scores and accreditations. We
work hard to maintain the highest ESG ratings and in the latest
Standard & Poor Global Ratings (S&P) received a best-in-class
score of 83. We participate in a range of initiatives, including the
UN Global Compact.
Read more
about our
sustainability
strategy on
page 50
Part of the LSE Green
Economy Mark
Remaining part of
the FTSE4Good for
the last 11 years
Score C
Climate Change Questionnaire
Level 4
For our Dutch Commercial
Waste division, Mineralz & Water,
Coolrec and Maltha
Strategic reportGovernance reportFinancial statementsOther information 30
CEO’s
strategic review
I am pleased to report that Renewi has performed very
well in the past year, in terms of a robust financial
performance, alongside the further development of its
long-term strategy for accelerated growth.
Summary
Revenue of €1,892m and underlying
EBIT of €132.9m similar to prior year
Effectively mitigated normalisation
of recyclate prices, lower volumes
and high inflation through cost
control and customer price increases
Good progress made on our key
strategic initiatives to deliver €40m
of additional EBIT by FY26, with the
first €20m delivered to date
Customer NPS increased from 3 to 18
Recycling rate (rebased) increased to
63.6%, 7mT of secondary materials
put back into re-use
Scope 1, 2 and 3 emissions
methodology externally validated,
application for SBTi under way
For more information on our
innovation portfolio, visit
renewi.com
Our key strategic
initiatives aimed at
delivering sustained
growth for Renewi are
continuing to deliver
according to plan
OVERVIEW
Renewi delivered a strong performance in
FY23, and our business coped well in a
macroeconomic environment that saw cost
inflation across our operations as well as
volatility in recyclate prices. As anticipated,
revenues were stable year on year, with an
underlying decline in input volumes. The
normalisation in recyclate prices during the
year from all-time highs was balanced by a
disciplined pricing strategy with our
customers. In this environment we were
pleased to see strong loyalty from
customers, and our ability to pass our input
costs on to them demonstrates both the
quality and essential nature of our services.
Our activities are driven by an increasingly
favourable legislative environment in our
core markets, and we expect governments
will continue to legislate to mandate higher
levels of recycling in the future.
We delivered consistent EBIT margins as we
took action to eliminate loss-making
volumes, particularly in our Belgium
commercial business, and maintained tight
cost controls across the company. In a
competitive marketplace we have been able
to achieve low customer churn and win a
number of important new commercial
contracts. Our customer Net Promoter Score
has further improved from 3 to 18, against a
long-term target of 23 – confirming we are
on the right track to further improve our
customer services. This is primarily as a
result of the significant investment in this key
area including the digitisation aspects of
Renewi 2.0.
Our key strategic initiatives aimed at
delivering sustained growth for Renewi are
continuing to deliver according to plan. We
will begin to see the benefits of significant
capital investment in our advanced sorting
facilities in Belgium, and the building of the
new rigid plastics recycling facility in Acht
remains on schedule.
We are strengthening our positions in certain
sectors of our core markets, including
construction, healthcare and retail. During
the year, we acquired Renewi Westpoort
from Paro to further strengthen our leading
position in the construction and demolition
market in the Netherlands, and to give us
nationwide coverage for the large building
companies. At the same time we continue to
explore new uses for our secondary materials
with a landmark deal signed with Playmobil
during the year to produce a range of toys
containing >80% recycled plastics provided
by our Coolrec business. In addition, we
recently received an award for a fully closed
loop solution with Electrolux, where inner
liners for new fridges are to be made of >70%
recycled fridge plastics from Coolrec.
In a year where the effects of climate change
have continued to drive news headlines, with
significant adverse weather events and
record temperatures, the imperative to
achieve carbon reduction goals as set by
governments has become even more
obvious. The actions of legislators are
encouraging corporates to pursue net-zero
strategies including the procurement of low
carbon secondary materials, as well as
zero-waste strategies. By giving new life to
used materials and delivering high-quality
recyclates that have a much lower carbon
footprint than similar materials derived from
virgin materials, we can make a significant
contribution to reducing carbon emissions.
We are proud to be a major operator in the
Netherlands and Belgium, where the
adoption of the circular economy is one of
the highest within Europe. This position has
been driven to some extent by the positive
legislation that has been put in place by
national governments that recognise the
imperative to increase recycling rates and
change customer and consumer behaviours.
Although we acknowledge that there is still
much that needs to be done, we recognise
Renewi plcAnnual Report and Accounts 2023 31
that we have significant embedded expertise
that can be brought into other territories that
will inevitably legislate to bring circularity into
their own economies.
Total revenues were up 1% to €1,892.3m and
underlying EBIT was down 1% to €132.9m.
Profit before tax decreased by €2.6m to
€93.1m. Earnings per share fell to 79 cents
(FY22: 93 cents) driven by an increase in the
effective tax rate.
Outbound revenue from the sale of recycled
materials increased to €391.4m (FY22:
€372.6m) principally driven by a €23.5m
increase in Specialities from Maltha
and Coolrec and robust recyclate revenue
in Commercial.
The Commercial Division, representing over
73% of Group revenues, increased revenue
by 3%. Underlying EBIT fell by 5% driven by
cost inflation, higher utility costs, wage
inflation, lower volumes and normalisation of
recyclate prices with a more pronounced
impact in the Netherlands.
The Mineralz & Water Division saw revenues
decline by 2%, and underlying earnings
declined by €5.3m to €0.5m due to increased
TGG cost accruals and landfill provisions.
Performance at the waterside was strong,
despite an operational issue that required
unplanned maintenance. These issues have
now been resolved. On the soil side we made
good progress in the development of
producing building products on specification,
with sand and filler quality working towards
the requirements of the concrete industry.
This will allow us to start increasing our
throughput of contaminated soil in the second
half of FY24. We also have increased visibility
on legacy offtake and have several contracts
signed and in negotiation. To facilitate offtake
we anticipate higher prices, which has
impacted underlying EBIT by an increase in
disposal cost accruals.
Strategic reportGovernance reportFinancial statementsOther information 32
CEO’s strategic review CONTINUED
The Specialities Division saw flat revenues
year-on-year with a decline in Municipal
offset by strong revenue growth at Coolrec
and Maltha. Underlying EBIT increased by
€13.0m to €17.1m principally driven by
Maltha, along with the previously
announced €5m benefit from the IAS 37
accounting changes for Municipal.
Group central services costs have increased
by €2.0m in the year as a result of increased
investments in digitisation.
Renewi delivered adjusted free cash flow of
€72.9m (FY22: €91.3m as adjusted for the
prior year restatement as referred to in note
1) reflecting an increase in replacement
capital expenditure and tax payments. As
shown in the funds flow performance, there
was a total cash outflow of €64.9m (FY22:
inflow of €29.4m) driven by the initial net
debt impact of €66m to acquire the Renewi
Westpoort business from Paro, taking core
net debt to €371m (FY22: €303m).
Accordingly, core net debt to EBITDA
increased to 1.8x at 31 March 2023, FY22:
1.4x). Leverage is still comfortably within
the Board’s long-term target of 2.0x.
Liquidity headroom including core cash
and undrawn facilities was also strong
at €323m.
We are continuing to prioritise the allocation
of our capital towards the maintenance and
enhancement of our existing assets,
investment in new growth projects and
participating in the consolidation of our
industry through selective acquisitions. As
exceptional expenditure on the Renewi 2.0
programme is coming to an end, and legacy
items of expenditure including repayment of
Covid taxes and placement of TGG are
expected to be completed in the next 24
months, the Board intends to reinstate a
progressive dividend at the end of the
coming financial year.
SUSTAINABILITY MEANS
A NEED FOR CIRCULARITY
Our purpose has always been to give new life
to used materials, and our vision is to be the
leading waste-to-product company in
Europe’s most advanced circular economies.
We have made significant progress during the
year to build on our position as a leader in the
circular economies in which we operate.
Despite a period of economic uncertainty, the
drive from governments and industry towards
decarbonisation has continued to gain
momentum, driven by tangible evidence of
the effects of global warming that have
become increasingly evident during the year.
This has manifested itself in an increasing
demand for secondary materials from
manufacturers and more legislation aimed at
increasing recycling rates both from domestic
consumers and corporate entities.
Sustainability remains at the heart of
everything we do. Our purpose, our vision
and our business strategy have sustainability
at their core. In keeping with our purpose,
our business and sustainability strategies
are inextricably linked and mutually
supportive. In practical terms this means we
focus on three key objectives: Enable the
circular economy, Reduce our carbon
emissions and Care for people.
Restating our recycling rate to updated
international reporting standards
During FY23 a comprehensive external review
of our sustainability calculation
methodologies to ensure adherence to the
latest European Union guidance and
Greenhouse Gas (GHG) protocol has been
completed. This resulted in an updated
codification of the approach, and we have
updated our baseline and targets for scope 1,
2 and 3 carbon emissions and scope 4
carbon avoidance, as well as the recycling
rate. Changes in methodology reduced the
reported waste volumes processed, waste
volumes recycled, and scope 4 carbon
avoidance, and increased the scope 1&2
emissions. Scope 3 is reported for the first
time. The revised baseline FY22 values are
shown in the table below.
Following the work in FY23, we have
committed to set near-term targets to the
Science Based Targets Initiative (SBTi). Our
application process has started and we are
planning on submitting our targets for
validation by SBTi over the coming months.
Our carbon reduction ambition by FY31, from a
FY22 baseline as well as our restated figures,
are laid out in the table below.
The recycling rate increased in FY23 relative to
FY22 following the investments in new sorting
and processing installations, as well as the
acquisition of Renewi Westpoort (Paro), and
notwithstanding portfolio changes in M&W
where some high recycling rate low margin
activities were stopped or sold. Our ambition
remains to achieve 75% recycling, our
Mission75 programme, despite the fact that
due to the tighter definition our baseline has
been reduced by 6 percentage points.
Sustainability performance during the year
During the last year we have made good
progress with our strategy, including the
following highlights:
Enable the circular economy
• Recycling rate increased by 1.8% points to
63.6%
• Scope 4 carbon avoidance of 2.5mT
generated by producing low carbon
recyclates that replace higher carbon virgin
materials
• Our new state-of-the-art advanced sorting
facility in Ghent was opened, achieving a
>50% recycling rate on a 125kT residual
waste stream which was previously
incinerated
Group summary
Commercial Waste
Mineralz & Water
Specialities
Group central services
Inter-segment revenue
Total
REVENUE
UNDERLYING EBIT
FY23
€m
1,397.3
190.9
348.6
–
(44.5)
FY22
€m
1,360.5
193.9
350.1
–
(35.3)
1,892.3
1,869.2
Variance
%
3%
-2%
0%
–
–
1%
FY23
€m
129.3
0.5
17.1
(14.0)
–
132.9
FY22
€m
135.7
5.8
4.1
(12.0)
–
133.6
Variance
%
-5%
-91%
>100%
-17%
–
-1%
The underlying figures above are reconciled to statutory measures in notes 2 and 8.3 in the consolidated financial statements.
Renewi plcAnnual Report and Accounts 2023 33
Coolrec, Dordrecht
• We decontaminated 1mT of wastewater,
an achievement we are particularly proud
of in light of current droughts throughout
Europe
Reduce our carbon emissions
• Scope 1&2 reduced footprint by 60kT (-9%)
• Scope 3 carbon footprint is now mapped
at 1.2mT for the FY22 baseline year and
will report on this going forward
• We have committed to set near-term
science-based targets to SBTi
• Belgium’s tallest wind turbine, located
on our Ghent facility, has started
generating power
Care for people
• Our employee Net Promoter Score has
further increased to 24 (FY22: 18) and our
diversity target based on women in
management has further improved to 24%
(FY22: 22%)
• The total number of complaints received
by our sites has remained low for a second
year in a row, dropping further from 156 in
FY22 to 133 in FY23, driven by continuous
investments in technology, staff
awareness training and active
communication with the community
• Major environmental incidents and fires
have decreased significantly from 19 in
FY22 to 3 in FY23
Progress against each of our specific targets
will be detailed in full in our forthcoming
Sustainability Review
OUR STRATEGY FOR
THE LONG TERM
We have a clear and consistent business
strategy to deliver long-term growth in both
margins and volumes. To date, our strategy
has been focused on margin expansion
through increased recycling rates and the
production of higher-quality materials. In
addition, we are seeking to expand our
market share both in our core territories
and internationally.
Our strategy is based on three pillars:
1. Be a leader in recycling. Our ambitious
goal, launched as Mission75, is to increase
our recycling rate to 75% from the current
64%, which we believe is already the
highest in Europe. We continue to focus
on diverting waste away from incineration
as a key driver to achieving this mission
2. Be a leader in secondary material
production. For production companies
currently using primary materials, the
easiest way to improve their circularity is
by using high-quality, low carbon
secondary materials that they can drop
into their existing production processes.
To help them do this, we are continuing to
invest in increased valorisation through
advanced processing facilities to deliver
materials of the required quality
3. Grow market share. Our aim is to
achieve this through delivering organic
growth and by taking advantage of the
consolidation opportunities in our sector
both within our core markets and
Carbon reduction ambition
Metric
Volume of waste handled / recycled (mT)
Recycling rate
Scope 1&2 CO2 emissions (mT CO2 equivalent)
Scope 3 CO2 emissions (mT CO2 equivalent)
Scope 4 CO2 carbon avoidance (mT CO2 equivalent)
FY22
(baseline)
11.5/7.1
61.8%
640
1.2
2.6
FY23
(actual)
11.0/7.0
63.6%
580
N/A
2.5
Metrics using previous methodology, reported for historical comparability
Recycling rate
67.2%
69.4%
Scope 4 CO2 carbon avoidance (mT CO2 equivalent)
3.1
No longer calculated
Target
Not applicable
75%
50% reduction by 2030 (FY31)
25% reduction by 2030 (FY31)
Increase with recycling rate
Strategic reportGovernance reportFinancial statementsOther information 34
CEO’s strategic review CONTINUED
potentially in new territories that are
suited to our waste-to-product model.
In this endeavour we have three areas
of focus:
• Organic investment opportunities.
Offering attractive returns profiles of
greater than 16% pre-tax returns. These
include more than €100m of investments
already committed in our innovation
pipeline and further opportunities that are
currently being assessed
• M&A within the Netherlands and Belgium.
These investment opportunities have the
potential to consolidate and enhance our
market position in attractive sectors
• M&A outside of the Netherlands and
Belgium. We have the potential to take our
expertise and waste-to-product model
into other European jurisdictions with
more advanced circular economies. In the
immediate term there are opportunities to
expand in niche waste segments where
collection is not a requirement of the
business model: glass, white goods and
mattresses being good examples. Longer
term, we believe our waste collection
model can be replicated in other
territories, where the development of the
circular economy will be driven by
European Union legislation
Collectively across these three focus areas,
we have committed over €175m over the last
two years, including more than €100m of
investment in our innovation pipeline and
€66m for the acquisition of assets from Paro.
These investments are being funded by the
Group’s cash flow and borrowing capacity.
Update on the Group’s value drivers
We have three specific areas of activity to
grow underlying profitability in the period to
FY26. These are our ongoing investments in
circular innovations, the recovery of our
Mineralz & Water business and the Renewi
2.0 efficiency programme. Together these
drivers will deliver €60m in total by FY26 and
we are on track to achieve this, although the
Mineralz & Water recovery is taking longer
than expected. Each of these three value
drivers is discussed in more detail below.
1. Our investments in circular innovations:
innovation pipeline
We are investing in innovative solutions to
increase recycling rates and the quality of the
recyclates we produce, the first two pillars of
our strategy to deliver an additional EBIT of
€20m by FY26. Our programme to deploy
over €100m of investments across multiple
areas is progressing well, with €60m currently
deployed. Each project will exceed our
threshold for pre-tax return on operating
assets of 16% once the facilities are fully up
and running. We also have a pipeline of
potential innovation projects for future
investments. Full detail is shown below.
2. The recovery of our
Mineralz & Water business
We are witnessing an emerging demand from
the construction sector who are keen to
improve the circularity of their operations
by incorporating secondary materials into
their building products. The secondary
products also provide a financially
attractive alternative to the scarce primary
materials. At ATM we produce three
building products from contaminated soil:
gravel, which is selling well, and sand and
filler which we are selling in restricted
volumes while we work on getting the
quality of sand and filler in line with the
requirements of the concrete industry.
To meet the necessary quality we have
invested in further treatment equipment,
which will come on stream over the
summer. This will allow us to increase our
TGG throughput in the second half of FY24.
This is an important and final step in the
recovery of M&W, as we will increase both
input and output volumes accordingly.
3. Renewi 2.0
Our three-year Renewi 2.0 programme is
largely complete and the targeted €20m
underlying EBIT run rate will be achieved in
FY24 and we are in the process of handing
over the remaining activities to the
Divisions. The programme has delivered
MyRenewi, a portal used by over 100,000 of
our customers, to place and modify orders,
to add services, to review their carbon
footprint related to waste produced and
their invoices among other things. Another
part was the delivery of a new web shop for
new customers and a portal for suppliers. In
Circular innovation investments
PROJECT
STATUS
Advanced residual waste
sorting Flanders
Three lines approved. Two out of three progressing in line with expectations:
• Ghent: production started January 2023 and operating as expected
• Puurs: civil works started, on track, and new baling area ready and in
Organics: expanded
depackaging capacity
Organics: bio-gas to
bio-LNG
Plastic recycling
production
• Limburg site: new site acquisition delayed due to permitting process
Installation completed and operating as expected
Installation completed and operating as expected
Ghent and Waalwijk investments complete
Acht progress on track: civil works completed and construction of technical
equipment progressing well. Commissioning beginning Q2 as planned
Mattress recycling
Investment of chemical recycling of PUR foam facility in Lelystad. First
international expansion completed with the integration of TFR Group in the UK
Polyurethane recycling
Technical and commercial feasibility studies ongoing
Wood flake for low-carbon
steel
Project stopped for commercial reasons
Renewi plcAnnual Report and Accounts 2023 35
addition to the gained efficiency, our
customer NPS score improved from 3 to 18
and employee NPS improved from 18 to 24.
The Renewi 2.0 programme will be
delivered with an expected programme
expenditure €12m less than our original
€40m expectations.
We will continue to work on our efficiency
and digitisation to further improve customer
satisfaction and employee engagement and
to reduce our cost base further.
GROUP OUTLOOK AND DIVIDEND
Although the macroeconomic environment
remains unpredictable, Renewi has proven
that it is able to operate successfully in the
recent years of high volatility, adapting our
cost structure to reduced volumes and
protecting our margins by passing on cost
increases to customers. Our dynamic
pricing policy, where we link the price for
our waste collection to the index price of
the recyclates we produce from waste, has
proven successful, especially in times
where some recyclate prices fluctuate. We
expect recyclate prices to remain more
stable at normalised levels in the coming
year. Volumes in the year are expected to
develop in line with economic activity.
With the Renewi 2.0 programme benefiting
the business, the recovery of Mineralz &
Water progressing and the investment
in new lines coming on stream, we are
confident in Renewi’s ability to grow
in the future.
Our investment programme is ongoing, and
the business continues to identify
investment opportunities that are expected
to yield strong returns. In addition, Renewi
anticipates a consistently improving cash
position going forwards due to efficiencies
across the business and an end to deferred
Covid tax payments. We now expect to be in
a position to pay a dividend for FY24.
Renewi is now well positioned to focus on
growing both the top line and profitability of
its core businesses for the longer term. Over
the next five years, our aim is to accelerate
revenue growth targeting €3bn at high
single digit margins as a minimum. We
will achieve growth through market share
gains, by extracting more value from
waste by deploying advanced recycling
and by targeted acquisitions. EBIT
improvement is expected to grow even
faster, driven by growth and cost reduction
through digitisation.
Collaboration drives our progress
Sucessful collaboration between the CEO and CFO is
helping Renewi deliver on its strategic objectives.
When Annemieke den Otter joined
Renewi as CFO in 2022, both Annemieke
and Otto de Bont, the CEO, made a
commitment to build a collaborative
working relationship. They knew that by
working well together, they would help
Renewi deliver on the company strategy.
From day one, the two booked a weekly
time slot, allowing them to discuss
existing and upcoming investments and
strategic progress, as well as anything
else that requires their attention. They
also make sure that for at least one day a
week they work from the same location,
to avoid the chance of not seeing each
other for weeks at a time which, in
Annemieke’s words, “just doesn’t work”.
In fact, Annemieke and Otto are planning
to increase the number of days worked in
the same location to at least two per
week.
The time around financial results is an
intense one for the CEO and CFO, and the
two ensure they travel together to
maximise on time together. And, as
added benefit, they have a lot of laughs.
A key element of the CEO and CFO’s
successful collaboration is the way they
challenge each other and how they
distribute the topics that need attention.
When it comes to strategic growth
opportunities, both the CEO and CFO will
meet the stakeholders involved and form
a joint decision on the way forward.
“We’ve been consciously picking and
choosing what we dive into together,”
adds Annemieke. “Our close
collaboration is critical to drive the
success of the business,” adds Otto.
Each day, lines of communication
between the CEO and CFO are always
open, which means collaboration is
ongoing and good strategic progress
is being made. As Annemieke says.
“It makes things so much easier if you
work together.”
It makes things so
much easier if you
work together
Annemieke den Otter, CFO
Our close collaboration
is critical to drive the
success of the business
Otto de Bont, CEO
Strategic reportGovernance reportFinancial statementsOther information 36
CFO’s
financial review
Renewi delivered a strong performance in FY23 despite the
difficult macroeconomic environment of high inflation and
volatility. We have made significant progress during the year
to build on our position as a leader in the circular
economies in which we operate.
Summary
Basic EPS reduced from 93 cents to
79 cents
Group underlying EBIT margin of
7.0% with Commercial, Maltha and
Coolrec all operating close to 10%
EBIT margin
Statutory profit of €66.6m
Cash generation expected to
improve consistently over time
Renewi delivered a strong performance in
FY23 despite the difficult macroeconomic
environment of high inflation and
volatility. Revenues were stable year on
year. Underlying EBIT was slightly lower
than the prior year despite the €24.8m
impact of lower volumes from a decline in
input volumes and recyclate pricing. Cost
inflation was largely mitigated by pricing
discipline and ongoing cost initiatives.
Favourable one-off items in the current
year of €16.5m (FY22: €9.0m adverse
impact from one-off items) resulted from
settlements with incinerators, property
disposals, IAS 37 amendment
implementation as referred to below and
other items.
Underlying EBITDA decreased by 3%,
whereas underlying EBIT was 1% lower with a
number of impairments in the prior year not
repeated in FY23 and a higher profit from
disposal of property, plant and equipment
this year. Interest charges and share of results
from associates and joint ventures were
marginally adverse to last year. The level of
exceptional and non-trading items in the
current year was slightly higher than last year
at €10.6m as described below, resulting in a
statutory profit for the year of €66.6m
compared to €75.4m last year.
As previously announced the amendment to
IAS 37 Onerous Contracts – Costs of Fulfilling
a Contract, effective from 1 April 2022,
clarifies that the costs of fulfilling a contract
should include an allocation of other costs
that relate directly to fulfilling the contract in
addition to the incremental costs. The
Group assessed the impact of this
amendment which resulted in an increase to
the onerous contract provisions of €53.2m.
The cumulative effect of initially applying
the amendment has been recognised as an
adjustment to the opening balance of
retained earnings as at 1 April 2022. The
impact has resulted in annual costs of €5m
now being utilised against the provision
rather than recorded as part of underlying
EBIT with no impact on cash. As permitted
by the amendment, the Group has not
restated the comparative information.
Financial performance
Revenue
Underlying EBITDA
Underlying EBIT
Operating profit
Underlying profit before tax
Non-trading and exceptional items
Profit before tax
Total tax charge for the year
Profit for the year
FY23
€m
FY22
€m
Variance
%
1,892.3
1,869.2
262.6
133.6
124.0
1%
-3%
-1%
-2%
105.2
-1%
(9.5)
95.7
(20.3)
75.4
255.6
132.9
121.4
103.7
(10.6)
93.1
(26.5)
66.6
The underlying figures above are reconciled to statutory measures in notes 2 and 8.3
in the consolidated financial statements.
Thanks to the great
efforts of our employees
and the loyalty of our
customers we have
been able to cope with
some extraordinary
circumstances
Renewi plcAnnual Report and Accounts 2023
37
Further to a more in-depth analysis of the UK
Municipal contract with East London Waste
Authority (ELWA) and receipt of legal advice, it
has been determined that the original lease
accounting as recorded on the transition to
IFRS 16 in April 2019 was treated incorrectly.
We have therefore presented this as a prior
year adjustment, with the March 2022
balance sheet showing a reduction in lease
liabilities of €9.5m, an increase in onerous
contract provisions of €5.8m, an impact of
€3.6m on retained earnings and €0.1m on the
exchange reserve. The Income Statement
impact for the year ended 31 March 2022 was
not material and therefore has not been
restated. Further details are given in note 1.
As reported with the FY22 results, we revised
our accounting policy with regard to the
treatment of costs associated with the
configuration and customisation incurred in
cloud computing or Software as a Service
arrangements. Any such costs in the current
year are recorded as part of regular
underlying EBIT.
Non-trading and exceptional items
excluded from underlying profits
To enable a better understanding of
underlying performance, certain items are
excluded from underlying EBIT and
underlying profit before tax due to their size,
nature or incidence. Total non-trading and
exceptional items excluding tax were a
charge of €10.6m (FY22: €9.5m).
As previously reported, we have accounted
for the cost of the Renewi 2.0 programme
as exceptional due to its size and nature.
The programme of activity is largely
complete and will deliver €20m cost
benefits in FY24. The cost of the programme
is now expected to be around €28m,
significantly below original expectations of
€40m due to lower settlement costs, with a
remaining €3m cash outflow expected in
FY24. Annual net benefit of €12m for the
year with cash spend of €4m which was
lower than expected.
The UK Municipal provision for onerous
contracts has been increased by a further
€27.1m in the year. This has arisen due to
revised assumptions on both lifecycle spend
and cost inflation, combined with lower
volumes at the ELWA contract partially
offset by the indexation of customer pricing.
In line with our policy, this item is recorded
as non-trading and exceptional due to size
and nature.
Following the conclusion of the European
Commission’s formal investigation in the
alleged Belgium State Aid matter and the
determination that the Belgian Walloon
region did not provide State Aid to the
Group, the provision of €15.1m has been
released. This has been reported a non-
trading and exceptional credit as the original
set up of the provision was classified as such.
Further details on all non-trading and
exceptional items are provided in note 3.3 to
the consolidated financial statements.
Operating profit, after taking account of all
non-trading and exceptional items, was
€121.4m (FY22: €124.0m).
Net finance costs
Net finance costs, excluding exceptional
items, increased by €0.3m to €29.2m
(FY22: €28.9m) due to increased costs for
lease liabilities and discount unwind net of
savings in other areas. Further details are
provided in note 5.4 to the consolidated
financial statements.
Strategic reportGovernance reportFinancial statementsOther information 38
CFO’s financial review CONTINUED
Renewi 2.0: expected costs and benefits
Annual net benefit
Exceptional costs
Capital spend
Net cash flow
FY21
€m
FY22
€m
2
(7)
(5)
(10)
5
(7)
(2)
(4)
FY23
€m
12
(4)
–
8
FY24
€m
20
(3)
–
17
Funds flow performance
EBITDA
Working capital movement
Movement in provisions and other
Net replacement capital expenditure
Repayments of obligations under
lease liabilities
Interest and loan fees
Tax
Adjusted free cash flow
Deferred Covid-19 taxes
Offtake of ATM soil
UK Municipal contracts
Free cash flow
Growth capital expenditure
Renewi 2.0 and other exceptional spend
Acquisitions net of disposals
Other
Total cash flow
Free cash flow conversion
FY23
€m
255.6
(5.8)
(0.2)
(87.3)
(47.5)
(20.7)
(21.2)
72.9
(19.7)
(1.2)
(12.2)
39.8
(30.8)
(4.1)
(59.4)
(10.4)
(64.9)
30%
FY22
€m
262.6
(38.0)
4.5
(68.2)
(43.5)
(18.5)
(7.6)
91.3
(10.6)
(10.3)
(9.9)
60.5
(13.1)
(11.0)
–
(7.0)
29.4
45%
Free cash flow conversion is free cash flow as a percentage of underlying EBIT. The
non-IFRS measures above are reconciled to statutory measures in note 8.3 in the
consolidated financial statements. FY22 values for repayments of obligation under
lease liabilities and UK Municipal contracts have each been adjusted by €0.7m to
reflect the prior year adjustment as referred to in note 1.
Profit before tax
Profit before tax on a statutory basis,
including the impact of non-trading
and exceptional items, was €93.1m
(FY22: €95.7m).
Taxation
Total taxation for the year was a charge of
€26.5m (FY22: €20.3m). The effective tax rate
on underlying profits was 27.1% at €28.1m,
an increase from 25.0% in the prior year, as
anticipated given recent changes in rates in
the Netherlands and the UK. A tax credit of
€1.6m is attributable to the non-trading and
exceptional items of €10.6m as a number of
items are not subject to tax.
Looking forward, we anticipate the
underlying tax rate to remain around 27%.
Due to items disallowed for tax in both the
Netherlands and Belgium, our effective tax
rate is higher than the nominal rates in the
countries where we operate.
The Group statutory profit after tax, including
all non-trading and exceptional items, was
€66.6m (FY22: €75.4m).
Earnings per share (EPS)
Underlying EPS excluding non-trading and
exceptional items was 90 cents per share, a
decrease of 8 cents impacted by the higher
effective tax rate. Basic EPS was 79 cents per
share compared to 93 cents per share in the
prior year.
CASH FLOW PERFORMANCE
The funds flow performance table is derived
from the statutory cash flow statement and
reconciliations are included in note 8.3 in
the consolidated financial statements. The
table shows the cash flows from an adjusted
free cash flow to total cash flow. The
adjusted free cash flow focuses on the cash
generation excluding the impact of Covid-19
tax deferrals, settlement of ATM soil
liabilities and spend relating to the UK PPP
onerous contracts.
Adjusted free cash flow was lower at
€72.9m (FY22: €91.3m) impacted by increased
replacement capex and taxation payments
principally, partially offset by a smaller
movement in working capital. Days sales
outstanding have increased slightly
since March 2022 and still remain l
argely unimpacted by the current high
inflationary environment.
Replacement capital spend at €87.3m was
ahead of last year reflecting some catch up
from the prior two years which were more
Renewi plcAnnual Report and Accounts 2023 39
Construction and demolition waste
sorting line, Commercial Waste NL,
Wateringen
constrained during Covid. In addition, €57.4m
of new leases or modifications have been
entered into which are reported as right-of-
use assets with a corresponding lease
liability. These leases include the
continuation of the truck replacement
programme, property lease renewals or
extensions and other assets.
amendment to IAS 37, Onerous Contracts
– Costs of Fulfilling a Contract has resulted in
annual costs of €5m now being utilised
against the provision rather than recorded as
part of underlying EBIT. Taking this into
account, the cash outflow on UK PPP
contracts at €12.2m was lower than expected
due to phasing.
Growth capital spend of €30.8m includes
further spend on the VLAREMA 8 advanced
sorting investments in Belgium, plastics
sorting in the Netherlands and some projects
in other divisions.
Tax payments were €13.6m higher than last
year as some payments moved from FY22
to FY23.
Looking at the three components that are
shown below adjusted free cash flow, there
has been a further €19.7m repayment on
Dutch Covid-19 tax deferrals as expected. The
remaining balance of €30m will be settled
over the next 18 months. Cash cost of
placement of TGG soil stocks was limited in
the year at €1.2m (FY22: €10.3m). The cost
accrual for the remaining disposals of
historical TGG anticipated over the next 24
months has been increased by €1m to €16m.
As noted earlier, the application of the
The acquisitions net of disposals outflow is
principally €60.5m for the Renewi Westpoort
acquisition from Paro representing the cash
paid of €53.5m and the repayment of loans
acquired. Further details are provided in note
6.1 to the consolidated financial statements.
Other cash flows include funding of €3.5m for
the closed UK defined benefit scheme,
funding of €5.3m to the Renewi Employee
Share trust and an additional injection of
€1.5m into the investment in RetourMatras in
relation to their UK acquisition.
Net cash inflow from operating activities
increased from €179.7m in the prior year, as
adjusted for the prior year restatement
referenced in note 1, to €188.4m in the current
year. A reconciliation to the underlying cash
flow performance as referred to above is
included in note 8.3 in the consolidated
financial statements.
INVESTMENT PROJECTS
Expenditure in FY24
The Group’s long-term expectations for
replacement capital expenditure remain
around 80% of depreciation. FY24
replacement capital spend is expected
to be around €75m. In addition, c.€20m
of IFRS 16 lease investments are
anticipated, as the final deliveries of the
latest replacement truck programme
is completed.
Expenditure on the circular innovation
pipeline of €25m is expected in FY24 as
the Puurs site in Belgium and the Acht
rigid plastic processing plant in the
Netherlands are completed. Total growth
capital spend in FY24 is expected to be
around €50m including projects in the
other divisions.
Return on assets
The Group return on operating assets,
excluding debt, tax and goodwill, fell
slightly from 42.6% at 31 March 2022 to
36.9% at 31 March 2023 due to increased
asset values as a result of capital
expenditure levels and the acquisition of
Renewi Westpoort from Paro. The Group
post-tax return on capital employed was
10.6% (FY22: 11.6%).
Strategic reportGovernance reportFinancial statementsOther information 40
CFO’s financial review CONTINUED
TREASURY AND CASH
MANAGEMENT
Core net debt and leverage ratios
Core net debt excludes IFRS 16 lease
liabilities and the net debt relating to the UK
PPP contracts which is non-recourse to the
Group and secured over the assets of the
special purpose vehicles. Core net debt was
in line with management expectations at
€370.6m (FY22: €303.0m), which resulted in
a net debt to EBITDA ratio of 1.8x, an
increase from last March due to the
Westpoort acquisition and growth capital
spend. Liquidity headroom including cash
and undrawn facilities remained strong
at €323m.
Debt structure and strategy
Borrowings, excluding PPP non-recourse
borrowings, are mainly long-term. All our
core borrowings of bonds and loans are
green financed. As at 31 March 2023, 85% of
our net debt excluding UK PPP non-recourse
net debt was on a fixed rate.
In November and December 2022, the Group
signed new fixed rate green facilities of €95m
in addition to the €200m of outstanding fixed
rate bonds. The new borrowings include a
€45m 7-year European Private Placement at
4.676%, a facility of €40m with the European
Investment Bank with the first tranche of
€25m drawn at a fixed rate of 3.572%
repayable in seven equal annual instalments
commencing on 15 December 2025 and a
€10m 5-year bilateral loan at 4.22%. The
weighted average rate of our €305m fixed rate
borrowings is 3.3%.
The Group’s €400m green revolving credit
facility has most commitments maturing in
May 2025. We anticipate extending the term
of the RCF facility during FY24.
The introduction of IFRS 16 in 2019 brought
additional lease liabilities onto the balance
sheet with an associated increase in assets.
Covenants on our main bank facilities remain
on a frozen GAAP basis and exclude IFRS 16
leases. The Group has complied with its
banking covenants during the year. The
Group operates a committed invoice
discounting programme. The cash received
for invoices sold at 31 March 2023 was €84.7m
(FY22: €80.5m).
Debt borrowed in the special purpose
vehicles (SPVs) for the financing of UK PPP
programmes is separate from the Group core
debt and is secured over the assets of the
SPVs with no recourse to the Group as a
whole. Interest rates on PPP borrowings were
Debt structure
Belgian Green retail bonds
Green RCF
Other Green loans
Gross borrowings before lease liabilities
IAS 17 lease liabilities and other
Loan fees
Core cash
Core net debt
(as per covenant definitions)
IFRS 16 lease liabilities
Net debt excluding UK PPP net debt
UK PPP restricted cash balances
UK PPP non-recourse debt
FY23
€m
(200.0)
(102.5)
(105.0)
(407.5)
(9.1)
2.3
43.7
(370.6)
(245.8)
(616.4)
19.0
FY22
€m
Variance
€m
(300.0)
(15.0)
(25.0)
(340.0)
(8.7)
3.2
42.5
(303.0)
(212.4)
100.0
(87.5)
(80.0)
(67.5)
(0.4)
(0.9)
1.2
(67.6)
(33.4)
(515.4)
(101.0)
21.1
(2.1)
11.9
Total net debt
(685.7)
(594.5)
(91.2)
The FY22 values for IFRS 16 leases liabilities, net debt excluding UK PPP net debt and
total net debt have been reduced by €9.5m as a result of the prior year adjustment
referred to in note 1.
(88.3)
(100.2)
Renewi plcAnnual Report and Accounts 2023 41
fixed by means of interest rate swaps at
contract inception. As at 31 March 2023
this net debt amounted to €69.3m
(FY22: €79.1m).
PROVISIONS AND
CONTINGENT LIABILITIES
Around 87% of the Group’s provisions are
long-term in nature, with the onerous
contract provisions against the PPP
contracts being utilised over the remaining
term of up to 17 years and landfill
provisions for many decades longer. As
noted previously, the application of the
amendment to IAS 37, Onerous Contracts
– Costs of Fulfilling a Contract has resulted
in an increase of €53m to the onerous
contract provisions on 1 April 2022 and
there has been an additional €27.1m charge
in the year as detailed above. In addition, as
referred to in note 1, a prior year
restatement increased the opening balance
of provisions by c.€6m.
The provisions balance classified as due
within one year amounts to €44m, including
€3m for restructuring, €19m for onerous
contracts, €11m for landfill related spend and
€11m for environmental, legal and others.
The position on the alleged Belgian State Aid
claim has now been closed resulting in the
release of the €15m provision booked in an
earlier period.
scheme had an accounting deficit of €4.3m
(FY22: €8.6m surplus). The change in the
year was due to lower returns on pension
scheme assets which were only partly offset
by an increase in the discount rate
assumption on scheme liabilities. The latest
triennial actuarial valuation of the scheme
was completed at 5 April 2021 and the future
funding plan has been maintained at the
current level of €3.5m per annum until
December 2024.
There are also several defined benefit
pension schemes for employees in the
Netherlands and Belgium which had a
retirement benefit deficit of €5.0m at 31
March 2023, a €1.3m decrease from
31 March 2022.
GOING CONCERN
The Directors have adopted the going
concern basis in preparing these
consolidated financial statements after
assessing the Group’s principal risks. Further
details of the modelling and scenarios
prepared are set out in note 1 of the financial
statements. Having considered all the
elements of the financial projections and
applying appropriate sensitivities, the
Directors confirm they have a reasonable
expectation that the Group has adequate
resources to continue in operational
existence for the foreseeable future and to
meet its covenants.
Retirement benefits
The Group has a closed UK defined benefit
pension scheme and at 31 March 2023, the
For more information on
our financial performance
go to renewi.com
Financial Shared Services
Centre, Lommel
Commercial Waste NL,
Amsterdam
Strategic reportGovernance reportFinancial statementsOther information 42
V A L U E D R I V E R S
Circular
innovations
Circular innovations, Renewi 2.0 and M&W recovery
make up our value drivers. These have been identified
as the key strategic components that bring additional
value to the business in the intermediate term.
CIRCULAR INNOVATIONS
We are investing in pioneering solutions to
increase our recycling rate to 75% and
improve our product quality. Together, these
two factors will be key to the successful
execution of our strategy and will help
improve our performance by delivering an
additional EBIT of €20m by FY26.
Last financial year, we announced over
€100m of investments across four innovation
areas: plastics recycling, deriving value from
organic waste, production of building
materials and advanced sorting of residual
waste in Flanders. These investments are
being implemented over three years, with
€60m already deployed. Each project will
exceed our threshold for a pre-tax return on
operating assets of 16% as the facilities are
commissioned.
KEY PROGRESS
At the forefront of recycled plastics
We hold a leading position in Belgium and
the Netherlands for high-quality recycled
plastics, collecting and processing up to
100kT of rigid plastics annually. By investing
in the enhancement of sorting and
treatment, we are creating higher-quality
materials which allow our customers to use
recycled materials and reach their
sustainability goals.
• Investments in advanced sorting and
recycling techniques in Ghent and
Waalwijk completed
• Playmobil partnership confirms the high
quality of our secondary plastics from
fridges. Read more about this partnership
on page 85
• Investment in new rigid plastics recycling
line in Acht is ongoing: civil works began in
Laboratory, Coolrec,
Waalwijk
2.1m kg
of bio-LNG produced
€100m+
of investments over three years
across four innovation areas
Renewi plcAnnual Report and Accounts 2023
43
Coolrec, Waalwijk
Quality control laboratory,
Commercial Waste BE. These
plastics are used for new
electronic products
August 2022, construction of technical
equipment started in January 2023
and first commissioning is expected in
summer 2023
Addressing the food waste challenge
We process kitchen waste (swill), out-of-date
food waste and green waste, also named
organic waste, into a wide range of unique
and environmentally friendly fuels (e.g.,
bio-LNG and green gas) and fertilisers
through biological processes like anaerobic
digestion and composting.
• State-of-the art depackaging facility
collects and depackages out-of-date food
waste from largest retail business in the
Netherlands, running at over 100,000
tonnes per year, confirming our market-
leading position
• In 2022 processed 59kT with continually
expanding volumes, and recently
commissioned first of four Renewi loading
docks at a distribution centre to improve
facilitation, with the other three to follow
in the coming year
• Bio-LNG facility going from strength to
strength with 2.1 million kg produced
• Gas-to-grid project under way, with
detailed engineering complete and
construction started in January 2023, and
commissioning planned for Q3 2023
Circular infrastructure for
a circular economy
We convert contaminated soil and
asphalt into sand, gravel and filler that
are secondary raw materials suitable for
the production of concrete and asphalt
for infrastructure works. These replace
primary raw materials used in the
production of kerbstones and paving
stones, among others.
Strategic reportGovernance reportFinancial statementsOther information Quality-assured plastics recyclate
44
Circular innovations CONTINUED
Focus has shifted to cement/concrete
market in light of movement away from
thermally-treated soil
• Installing a windshifter to improve sand
grain size distribution, which improves the
quality of our sand by creating a more
narrow specification for concrete
manufacturers
• Additional equipment will be installed to
meet the clients’ specifications for sand
and filler
• There is a growing demand for secondary
building products, with new sand and filler
contracts signed with manufacturers in
the concrete industry.
Advanced sorting of residual waste
Renewi is investing over €60m in advanced
sorting of residual waste in Belgium,
allowing our customers to comply with
VLAREMA 8 legislation, which bans
recyclable materials from being incinerated.
The three new lines listed below have a
capacity of almost 375kT and a recyclate
recovery rate of more than 50%, meaning
less incineration and CO2 emissions.
• Ghent: Renewi’s first advanced sorting line
has been built, commissioned and
operating with a yield of ~50% on a total
volume ~125kT per year, which means
50% less incineration than before
Our innovation process explained
Focus of innovation process
Focus of investment committee
0 > Search fields
1 > Ideas
development
2 > Concept
development
3 > Detailed
development
4 >
Implementation
Exploration
innovations
‘on the edge’
Exploring,
sketching,
screening feasibility
Prototyping,
testing, ranges
for feasibility
Engineering,
defining, validating
feasibility
Project execution,
building
Market value
Business model
strategy and risks
150 Ideas
Screened
potential
15 concepts
Tested
feasibility
5 Projects
Validated
details
3-5 Projects
Implemented
innovation
Technology
operations
Renewi plcAnnual Report and Accounts 2023 45
• Puurs: Development has begun, and site
infrastructure and civil works started in
December 2022 and on track to finish in
Summer 2023
• New baling press being built and
production will begin in May 2023, and
first sorting line expected Q1 2024
• Limburg: Permit in preparation and being
negotiated with authorities
• Read more about our alignment with
VLAREMA 8 on page 77
WHAT INNOVATION
AT RENEWI LOOKS LIKE
At Renewi, we consider innovation an
essential and ongoing process, so we are
generating new circular innovation ideas for
future investments, and always have a
pipeline of potential innovation projects.
Why we innovate
We innovate to continuously improve our
business and deliver on our strategy to
make high-quality and high-value products
from waste. Innovation pushes our own
sustainability performance and that
of our customers, with our circular
material products helping reduce their
scope 3 emissions.
How we innovate
Our innovation focuses on six themes and
uses a combination of a lean-start-up based
innovation approach and a stage-gate
funnel (see diagram opposite). At all stages
we work with a highly motivated internal
start-up founders’ team and clearly defined
internal investors. Right from the start we
test our assumptions on the market, the
value proposition, the business model
strategy and risks, the technology and
operations side.
Across Renewi, our aim is to develop at
least 150 ideas and implement between
three and five innovations each year.
At each juncture, we select only the most
impactful, highest-potential innovations
to receive internal investments for the
next stage.
Co-innovating
Co-innovation is important as it allows us to
work alongside the best-in-class in our
partners’ fields to deliver best-in-class
results. We are experienced in three main
strands of co-innovating. Our customers or
partners can join existing innovation
developments, start new innovation actions
or develop new business alongside Renewi
for market-wide streams, or start new
innovation actions for unique streams.
Innovation in action
We are proud of every innovation we
have brought to market, and below we
have listed some of our best examples.
PeelPioneers
We collect discarded citrus peels and
transport them to the PeelPioneers site,
which is the first business worldwide to
recycle citrus peels in a 100% circular
solution. Renewi helps PeelPioneers
recycle 10 million kg of citrus peels per
year, turning them into essential oils
and citrus pulp.
BioPlastics
Building on our know-how of microbial
digestion processes, we work alongside
high-tech partners like TripleW, Paques
Biomaterials, Pentair, Colasit, and Waste
Treatment Technologies to turn organic
waste into the next generation of
bio-based and biodegradable plastics.
ViuMore
This innovation incorporates artificial
intelligence (AI) into our sorting
systems. Through our partnership with
ViuMore, we improve the safety of our
colleagues and the source separation
rates of our customers, by employing
cameras and image-recognition
software powered by AI.
10 million kg
of citrus peels collected per year
and transported to PeelPioneers
SQAPE geopolymers
In a joint venture between our M&W
Division and our partners Cementbouw,
we create concrete made without
cement, which creates 80% less CO2,
with 100% recycled content.
Strategic reportGovernance reportFinancial statementsOther information 46
V A L U E D R I V E R S
Renewi 2.0
We are using a digital platform to improve
the Renewi experience for our customers
and keep our business fit for the future.
RENEWI 2.0
The Renewi 2.0 programme is designed to
streamline the business, make Renewi more
customer-focused, efficient and an even
more enjoyable place to work. After
three years, most of the programme building
blocks are complete or are nearing
completion. By summer 2023, the
foundations will be in place, and the focus
will shift entirely to reaping the benefits.
The Renewi 2.0 programme has three
overarching goals:
• Improve EBIT by €20m
• Achieve the target NPS score of 23
• Improve employee NPS from 14
points to 29
By the end of FY23 we reached €17m EBIT
improvement, a customer NPS of 18 and
an employee NPS of 24.
The satisfaction of our customers and our
employees is key to ensuring Renewi is fit for
the future.
Renewi 2.0 is built upon core themes.
The progress of each is outlined on the
opposite page.
16,000
orders per month
MyRenewi
landing page
Renewi plcAnnual Report and Accounts 2023
47
Customer Care
department, Amersfoort
100,000+
activated users of MyRenewi
295,000
orders placed through MyRenewi
1
Optimise digital
customer experience
We saw continued growth
in the use of MyRenewi,
our customer self-service
platform for Commercial
Waste. In both Belgium
and the Netherlands,
approximately 80% of
our customers have been
activated and use the
platform, contributing
to our omni-channel
service model strategy.
Customers continued to
place on average 16,000
orders each month through
the platform.
2
Digitise internal
sales processes
To improve speed, remove
manual work and reduce
errors, we have constructed
an interface between
our customer relationship
management and
operational systems which
is nearing completion. More
than 80% of newly created
customer accounts flow
through the interface.
With e-signing and an
automated quality check,
the sales team can improve
‘first time right’ service
delivery to our customers.
4
Simplify processes
and reduce complexity
Renewi 2.0 continued to
focus on business process
improvement and
enhancing data quality,
both important ingredients
for better service delivery
to our customers. Our data
analysts conduct more
sophisticated analyses
as more data is being
unlocked through the use
of the tools Azure Data Lake
and Python.
3
Strengthen commercial
capabilities
One of the most valuable
benefits of the Renewi 2.0
programme is the close
cooperation that has
developed between the
Belgian and Dutch
Commercial Waste Division,
particularly in harmonising
and digitising their sales
processes in a programme
we call Digital Sales Flows
(DSF). DSF launches in 2023
and offers both customers
and members of our sales
teams a guided digital
process to configure the
right set of services for a
given customer segment,
generate the right price
and produce a quote
the customer can
digitally accept in one go.
Strategic reportGovernance reportFinancial statementsOther information 48
V A L U E D R I V E R S
M&W recovery
Within our Mineralz & Water Division (M&W), ATM is one of
our largest and most sophisticated sites, and has been in
operation for more than 40 years. Located in Moerdijk, on
the Hollands Diep river, the site provides great access for
international deliveries of soil and wastewater by barges.
In the past year, the recovery of ATM was
delayed, as ATM has focused on the
transition from the production of
thermally cleaned soil for infrastructure
projects to the creation of valuable
secondary construction materials for
concrete applications.
At ATM, soil is cleaned and separated into
three secondary building materials – gravel,
sand and filler. We see the value of these
materials increasing alongside product
quality, and the offtake market becoming
larger. The offtake of these materials has
already been approved by regulatory
bodies, and our first partner contracts are
now in place.
ATM invested in quality improvements to
meet the stringent demands of the concrete
market with respect to particle size
distribution and other key parameters. ATM is
still in the process of extensively testing the
consistency and quality of its products to
meet these demands, which is why
substantial offtake is expected to happen well
into FY24.
ATM continues its activities in the
decontamination of large volumes of
wastewater contaminated by industrial
cleaning, as well as wastewater from the
ship-cleaning services that we provide at the
site’s jetty.
New legislation is creating additional
complexity around the application of
thermally cleaned soil in infrastructure
projects. Our work to sell historic productions
of this material has progressed slower than
expected. We continue to ensure full
compliance with regulations at ATM.
Capable of processing over
2mT
of waste a year across
water, soil and packed
chemical waste
For more information on our gravel,
sand and filler products, please see
our Forz case study on page 81
Gravel, sorting line,
ATM Moerdijk
Renewi plcAnnual Report and Accounts 2023
49
Laboratory, M&W,
ATM Moerdijk
35,000
samples of soil and water are tested
for contamination levels every year
ATM Moerdijk covers an area of
180,000m²
Gravel, sorting line,
ATM Moerdijk
Strategic reportGovernance reportFinancial statementsOther information 50
Renewi plc
Annual Report and Accounts 2023
Secondary material
Commercial Waste NL, paper
used by paper mills for new
paper and cardboard products
51
S U S T A I N A B I L I T Y S T R A T E G Y F O C U S
Enable the
circular economy
A commitment to the circular economy is critical
to turn the tide on macroeconomic crises and
influence the change our planet needs.
OBJECTIVE
METRIC
To turn our
customers’ waste
into new products
Recycling rate
(% of total waste handled)
PROGRESS TO DATE
FY22
FY23
61.8%*
63.6%
TARGET
75.0%
Volume of materials recycled (mT)
7.1*
Volume of waste handled (mT)
Carbon avoidance
(kg CO2 per tonne of waste handled)
11.5*
225*
7.0
11.0
233
Innovative secondary
materials produced (tonnes)
282,400
325,990 1m
Wastewater cleaning activities1
(total output in tonnes)
1,017,400
1,053,400
Production of renewable electricity1
(MWh)
108,762
69,458
Low carbon footprint biogas1 (m3)
1,776,700
4,787,000
* FY22 metrics have been restated following a review of our methodologies.
1. New reported KPIs.
SDG alignment
Progress summary
Restatement of our recycling rate and
carbon avoidance baseline for FY22;
making good progress toward our
75% target with an increased
recycling rate of 63.6% for FY23
Report on business activities now
include wastewater treatment and
production of renewable electricity
and low carbon footprint biogas
Over €60m advanced sorting
investment to adhere to VLAREMA 8
legislation
Increasing transparency and
first-time disclosures
RESTATING OUR RECYCLING RATE
TO ENSURE FULL COMPLIANCE
WITH EVOLVING INTERNATIONAL
REPORTING STANDARDS
We believe robust data and reporting
methodologies are critical and we are
committed to continued compliance to all
international standards on sustainability
reporting. For this reason, a cross-functional
internal team has completed a
comprehensive review of our methodologies
and reporting framework supported by
external experts. This has resulted in the
restatement of our FY22 recycling rate,
carbon avoidance and carbon footprint
baselines.
Key changes made on recycling rate include
harmonising methodologies across our
divisions and aligning labelling on solid
materials with international standards
(European Union and Country specific
regulations as well as the GHG protocol).
This has resulted in a restatement of our
FY22 recycling rate, our new baseline, from
67.2% to 61.8%. Volumes from wastewater
treatment activities are now all reported
within our recycling rate with a similar
approach to that of solids, and are also
reported separately for full transparency.
Additionally, we have set out on a journey
towards external assurance of our
sustainability data. We have started with
limited assurance for our scope 1&2 carbon
footprint, and will continue to increase the
scope of external assurance going forward.
To ensure historical comparability for
metrics included in our long term incentive
plan we will continue to report our recycling
rate using our old methodology as we
transition to the new one.
THE CIRCULAR ECONOMY
Globally, the past eight years have been the
Strategic reportGovernance reportFinancial statementsOther information 52
Sustainability strategy focus CONTINUED
Metal detection and separation at waste
wood sorting line. The recycled wood
is used in panel manufacturing,
Commercial Waste NL, Nieuwegein
warmest on record, according to the World
Meteorological Organization. Earth
Overshoot Day, which takes place on the
date when humanity’s demand for
ecological resources and services exceeds
what Earth can regenerate in that year,
keeps getting earlier. In 2022 it fell on 28 July
– a day earlier than in 2021. Much progress
needs to be made, which is why in FY23 we
have made ourselves even more
accountable, and for the first time are
disclosing KPIs for wastewater treatment
and production of renewable electricity and
low carbon footprint biogas.
With 70% of the world’s greenhouse gas
emissions relating to the handling and use
of materials (The Circularity Gap Report 2022,
published by Circle Economy), Renewi can
really make a difference.
HOW CIRCULARITY HELPS
TACKLE CLIMATE CHANGE
Circularity is one of the solutions that will
limit further temperature increases. Driving
the circular economy means using fewer
virgin materials, which means fewer
greenhouse gases and less residual waste.
The end goal of a circular economy is to
eliminate all waste by finding continual uses
for recycled materials. Outlined below is the
role Renewi plays in contributing to a
circular economy and our progress in FY23.
RECYCLING RATE
Through a comprehensive review of our
methodologies and recycling rate reporting
framework, our industry-leading recycling
rate for FY22 was restated to 61.8%. Out of
11.5mT of waste handed in FY22, 7.1mT was
recycled through our sorting and recycling
activities. In FY23, our recycling rate has
increased to 63.6%. This increase of 1.8
percentage points was mainly driven by the
acquisition of Renewi Westpoort in
Commercial Waste Netherlands, a business
with a high recycling rate in construction
and demolition, and through a strong focus
on innovation, better sorting and
continuous improvement in our recycling
processes across all divisions.
Renewi’s ambition is to increase its recycling
rate to 75%, through its Mission75
programme. After recently restating the
recycling rate and changing the baseline
from FY20 to FY22, Renewi is now
underpinning its plans to deliver Mission75
and beyond. The target year will be
confirmed over the course of FY24. Renewi
has steadily increased its recycling rate year
on year, giving us the confidence our
Mission75 is achievable.
Read more about our innovation projects
on page 45.
CARBON AVOIDANCE
When manufacturers choose to use
secondary instead of primary raw materials,
substantial carbon savings are generated in
the value chain. This year Renewi
contributed to the avoidance of 2.5mT of
CO2 emissions that would have been
otherwise emitted by raw materials
producers through their extraction,
transportation and production of virgin raw
materials and fuels. This equates to 233kg
CO2 per tonne of waste handled, compared
with 225kg CO2 per tonne the previous year
(restated figure – as our total recycling rate
has been restated).
We deploy a range of strategies to maximise
our total carbon avoidance. Firstly, we focus
our efforts on increasing our recycling rate
as this ensures we increase the volume of
valuable raw materials that are given a
second life. Secondly, the waste derived
fuels we produce replace fuels typically
derived from primary resources and
resources with a higher fossil content. We do
so either by selling to customers those waste
derived fuels (refuse-derived or solid
recovered fuel, Renewi’s ICOPOWER® pellets,
wood chips) or using it ourselves within our
own operation instead of purchasing fossil
fuels, or by producing renewable electricity
and low carbon footprint biogas (see more
details on page 53).
Through our sorting and recycling activities,
several residual waste streams still need to
Carbon avoidance in the supply chain
as a result of our activities
Recycling performance
Volumes (mT)
Total waste handled at sites
Materials recycled1,2
Materials recovered for energy production
from waste3
Others
FY224
11.5
7.1
3.6
0.7
FY23
11.0
7.0
3.2
0.7
Volumes (’000 tonnes)
Materials separated for re-use/recycling
Waste-derived fuels produced and sold
Landfill gas/anaerobic digestion
electricity production
Waste-derived fuel used at ATM
Recycling rate (% of total waste handled)
61.8%
63.6%
R1 Incineration emissions (negative)
1. Recycling is material given a ‘second life’ for reprocessing into new goods/materials.
2. Includes tonnages of treated wastewater.
3. Recovery is waste used for energy production, such as production of waste-derived
Total avoided emissions
fuels, biomass and similar.
4. FY22 figures are restated.
FY22
2,099
767
41
200
(506)
2,602
FY23
2,061
714
24
186
(436)
2,548
Renewi plcAnnual Report and Accounts 2023 53
Breakdown of our 2.5 mT of carbon avoidance by major category
81%
35%
88%
66%
44%
22%
0%
-22%
0.4%
1%
-17%
Recycling-
based potential
‘avoidance’
Waste-derived
fuels produced
and sold or
used on site
Anaerobic
digestion
power
generation
Landfill gas
power
generation
R1 incineration
emissions
(negative)
be sent to incineration with energy recovery.
Depending on the nature of the waste
stream being incinerated, overall this does
not enable the generation of carbon
avoidance: it does emit more CO2 than it
should have saved (as per the graph on page
53), this counterbalances our total carbon
avoidance generation and we thrive to
reduce the total tonnage sent to incineration
year on year.
INNOVATIVE
SECONDARY MATERIALS
We define innovative secondary materials as
tonnages of materials for which recycling
was possible thanks to innovation by
Renewi and/or our partners, in either/or:
• products (new materials);
• services (collection methods, business
models); and
• processes (sorting and separation).
We do this through close collaboration
across the value chain and our technology
partners, as well as working with knowledge
institutions and universities, ensuring
circular resources are closely aligned to
make the biggest impact.
In FY23, we produced 326kT of innovative
secondary materials.
world’s water, and it is humans who should
be accountable for its decontamination for
re-use. Highly contaminated wastewater
often cannot be discharged into local
wastewater treatment plants (from local
municipalities) as they are not equipped to
decontaminate such high levels of
pollutants. We also provide shipcleaning,
where we extract traces of fuel which is
made available for re-use on our sites, and
decontaminate the water. Around 9% of our
tonnage of waste handled is attributed to
the decontamination of more than 1mT of
wastewater, which is then safely put back
into the local wastewater sewage system.
For example, this takes place at our ATM site
– read more on page 78.
RENEWABLE ELECTRICITY AND
LOW CARBON FOOTPRINT BIOGAS
Humanity’s increasing reliance on energy is
one of the biggest challenges to creating a
circular economy. At Renewi, while creating
energy isn’t our main focus, we understand
its value. We look for ways to contribute to
the energy transition in any way we can,
because displacing fossil fuels leads to lower
carbon emissions. We capture biogas from
landfill and anaerobic digestion. Biogas
from landfills is combusted and converted
into electricity.
WASTEWATER
CLEANING ACTIVITIES
We are not limited to the handling of solid
waste. It is humans who contaminate the
When not transformed into electricity, the
biogas coming from anaerobic digestion of
organic waste is then used for the
production of bio-LNG. This offers a clean
alternative to fossil fuels. It has almost zero
particulate matter emissions and is believed
to generate 80% fewer greenhouse gases
compared to conventional diesel. In May
2022, our plant in the Netherlands achieved
a production milestone of 1 million kg,
enabling approximately 4 million km of
sustainable transport for heavy-duty trucks.
Year on year we continue to increase the
surface area of our premises where solar
panels are installed, and any electricity not
directly used is sold back to the grid. In
Belgium, our partnership with energy
supplier Engie resulted in the country’s
biggest wind turbine on land installed on
our Ghent site, which we expect to create
75% of the site’s electricity.
OUTLOOK
Our innovations and processes in FY23 make
us confident we will continue to make
progress and remain on track to keep
increasing our recycling rate. The target year
by when our Mission75 is achievable will be
confirmed over the course of FY24.
In parallel, we will continue to increase
measurement and transparency on our
sustainability related KPIs, enabling
better insight into our contribution to the
circular economy.
Strategic reportGovernance reportFinancial statementsOther information 54
S U S T A I N A B I L I T Y S T R A T E G Y F O C U S :
Reduce our
carbon emissions
Each year we recycle millions of tonnes of materials and give them a second life.
However, directly or indirectly, our activities generate CO2 emissions, and we
continuously search for solutions and innovations to reduce our carbon footprint.
OBJECTIVE
METRIC
Reduce our
carbon footprint
Absolute carbon footprint scope 1&2
(kT of CO2 e)
PROGRESS TO DATE
FY22
FY23
640*
580
Absolute carbon footprint scope 3
(mT of CO2 e)
1.2
**
Be a leader in clean
and green waste
collection
Carbon intensity collection
(kg CO2 per tonne of waste collected)
Share of Euro 6 trucks
(% of total fleet)
Zero-emission trucks
(number)
Reduce the carbon
impact of our
operations
Carbon intensity of our sites
(kg CO2 per tonne of waste handled)
Share of renewable energy used on site
(% of renewable electricity out
of total electricity use)
20.1*
18.8
67%
76%
2
4
7.56*
7.50
32.7%
42.9%
Hybrid or electric lease cars
(% (PH)EV vehicles out of total fleet)
39%*
38%
2025 TARGET
2030 TARGET
544
(-15%)
320
(-50%)
0.9
(-25%)
100% 100%
65
100%
50%
50%
40%
* FY22 metrics have been restated following a review of our methodologies. ** To be reported through our 2023 CDP disclosure (Climate Change questionnaire).
SDG alignment
Key performance indicators
Commited to set near-term science
based targets to SBTi;
Ambition to half our carbon
emissions scope 1&2 by FY31
First time carbon emission reduction
ambition on scope 3
Progress summary
A 9% decrease of our scope 1&2 and
an increase of our share of renewable
electricity between FY22 and FY23
RESTATING OUR BASELINE
TO ENSURE FULL COMPLIANCE
WITH EVOLVING INTERNATIONAL
STANDARDS, BEFORE BUILDING
AN AMBITIOUS DECARBONISATION
ROADMAP
As stated on page 51, we believe robust data
and reporting methodologies are critical
and we are committed to continued
compliance to all international standards on
sustainability reporting. For this reason a
cross-functional internal team has
completed a comprehensive review of our
methodologies and reporting framework,
supported by external experts. This has
resulted in a restatement of our FY22
baseline of our recycling rate, carbon
avoidance and our carbon footprint.
Additionally, we have set out on a journey
towards external assurance of our
sustainability data. We have started with
limited assurance for our scope 1&2
carbon footprint, and will continue to
increase the scope of external assurance
going forward.
Our collaboration with an external agency
focused on validating our scopes 1&2 GHG
emissions and calculating, for the first time,
our indirect use phase emissions (scope 3).
This exercise mapped and quantified all
GHG emissions generated across the whole
value chain of Renewi’s activities.
As a result, our FY22 carbon footprint scope
1&2 was restated to align with the GHG
protocol. As a result, other metrics and
targets have been either created or updated
in line with our new carbon reduction
commitment with the Science Based Targets
initiative (SBTi).
Renewi plcAnnual Report and Accounts 2023 55
Commercial Waste NL
Amsterdam
Strategic reportGovernance reportFinancial statementsOther information 56
Sustainability strategy focus CONTINUED
We are strengthening
our sustainability
strategy and will start
building our net-zero
carbon emissions
roadmap this year
Otto de Bont, CEO
Electric truck, Commercial Waste NL,
Amsterdam
We have also, for the first time, mapped and
quantified our scope 3 carbon emissions.
Renewi’s carbon footprint scope 3 for FY22
accounted for a total of 1.2 mT of CO2e, which
represents 65% of Renewi’s total GHG emissions
(more details on the table on page 57).
OUR GOALS AND METRICS
In 2023, Renewi has committed to set
near-term science based targets. Our targets
will be submitted for validation to SBTi over
the coming months. Our near-term carbon
reduction target comprises a commitment
to reduce our absolute scope 1&2 GHG
emissions by 50% by end 2030 (FY31) from
our newly restated FY22 baseline. It also
includes a commitment to reduce our scope
3 emissions by 25% by 2030.
For FY22, our restated carbon footprint
scope 1&2 baseline is a total of 640kT of
CO2e. Our strategy to reach our new carbon
reduction goals by 2030 includes an
absolute carbon reduction ambition and
internal KPIs such as carbon intensity ratios
to drive the reduction internally. As shown
on the table on page 57, Renewi’s first source
of scope 1&2 GHG comes from its on-site
industrial processes (scope 1). Our second
source of GHG emissions originates from our
logistics and fleet (scope 1&2). Our third
source of carbon emissions comes from our
energy usage on site (scope 1&2).
Our two carbon intensity KPIs address the
carbon emissions from the last two biggest
sources of GHG emissions. Our carbon
intensity of collection KPI looks at the
carbon emissions from the consumption of
fuels and electricity within our logistic per
tonne of waste transported. The carbon
intensity of our sites KPI looks at the carbon
emissions from the usage of diverse on-site
energy sources per tonne of waste handled.
These two KPIs are tracked in all divisions
and are a measure of our efficiency and
performance in using energy while moving
or transforming waste.
FY23 PERFORMANCE
We have already delivered a decrease by 9%
or 60kT on our scope 1&2. Half of this
decrease can be attributed to a small
decrease of handled volumes, thus lower
process emissions (both on the biogenic
and anthropogenic types of emissions). For
example, we processed fewer volumes in
Mineralz & Water and fewer composting
activities took place in our two commercial
waste divisions. The second enabler of this
decrease comes from a combination of
transformation activities in our divisions.
Less fuel has been consumed: in the fleet of
our two commercial waste divisions or from
on-site fuel usage due to lower processed
volumes. Our share of renewable electricity
has increased from 32.7% to 42.9% through
maintaining our green certificates,
consuming our own renewable electricity
and purchasing more solar energy in some
of our divisions.
We will spend time in the coming months to
finalise the accounting of our total indirect
scope 3 emissions. Renewi will be reporting
on its FY23 scope 3 through its annual CDP
2023 disclosure (Climate Change
Questionnaire).
REDUCING OUR CARBON
FOOTPRINT IN THE
COLLECTION OF WASTE
To collect the waste we process and turn
into secondary raw materials, we manage a
fleet of trucks with regular collections. We
acknowledge this activity creates off-site
carbon emissions – about 15% of the total
Renewi footprint – so we track these in order
to continually minimise emissions. This
involves reducing the total fuel consumption
on route and revising the trucks’ sources of
energy, to move towards lower emissions
per km driven.
Renewi plcAnnual Report and Accounts 2023 number of green vehicles.
Scope 1
Process emissions (kT CO2 e)
57
Absolute carbon footprint scope 1, 2 and 3
Fuel Combustion (kT CO2 e)
Breakdown 1: Fuel consumption on
sites only (Fuel: Diesel, Gas, other)
Breakdown 2: Fuel consumption in the
logistic (Fuel: Diesel, Bio-LNG, other)
Biogenic emissions from processes and
combustion (kT CO2)
Emissions from Purchased electricity1
(Market based) (kT CO2 e)
Emissions from Purchased electricity1
(Location based) (kT CO2 e)
Total scope 1
Scope 2
Total scope 1&2 (considering market-based emissions
from Purchased electricity) (kT CO2 e)
Total scope 3
mT CO2 e 3
Renewi
Group
TOTAL
(incl. UK)
FY22
Renewi
Group
TOTAL
(incl. UK)
FY23
UK Only2
FY22
UK Only2
FY23
249
125
38
90
217
591
49
52
640
1.2
20
4
3
1
70
94
11
7
237
124
42
77
177
539
41
46
16
4
3
1
66
86
11
6
105
0.04
580
97
to be published in
2023 CDP disclosure
1. Renewi does not currently procure any other form of energy than electricity. Heat and Steam are generated on premises
where applicable therefore accounted for in scope 1.
2. As per SECR Regulation.
3. Including categories 1, 2, 3, 5, 6, 7 and 15.
Energy use1
Megawatt hours
Fuel use transport (scope 1)
Fuel use sites (scope 1)
Gas use sites (scope 1)
FY22
ex UK
389,250
61,554
99,153
FY22
UK
4,490
9,333
5,330
FY22
Total
FY23
ex UK
FY23
UK
FY23
Total
393,740
331,130
4,022
335,152
70,887
104,483
94,525
88,498
9,054
103,579
5,139
93,637
Electricity use (scope 2)
138,576
33,961
172,537
145,113
32,708
177,821
Total energy use from
significant sources
688,533*
53,114*
741,647*
659,267
50,923
710,190
1. This table is presented in accordance with the Streamlined Energy and Carbon Reporting (SECR) disclosure requirements.
* FY22 metrics have been restated following a review of our methodologies.
KPI was of 7.56kg of CO2e per tonne of waste
handled. For FY23 it dropped slightly to
7.5kg of CO2e per tonne of waste handled.
While we have been working on energy
optimisation programmes (less fuel or gas
consumed) and increasing our own
production of renewable energy and
prioritising the purchase of renewable
electricity (42.9% total renewable electricity
used out of the total electricity usage in
FY23), our total volumes of waste handled
has decreased by 0.5mT. Overall our
absolute carbon footprint has decreased
and through the definition of our roadmaps,
we are making the right steps toward our
2030 target.
GOALS AND ROADMAPS
Our divisions are currently building
roadmaps to bring confidence in the
reduction of our carbon footprint and to
meet our 2030 carbon reduction goals.
Commercial Waste
• We aim to roll out the production of
renewable energy (wind/solar) in more
We are achieving this through:
• route efficiency – where routes are
optimised to make them shorter;
• fuel efficiency – using Euro 6 trucks and
training staff to drive economically; and
• electrification of fleets – growing the
Within our Commercial Waste and
Specialities Divisions, we have made good
progress over the past year. The carbon
intensity of our waste collection activities
was 20.1kg CO2 per tonne of waste collected
in FY22 and decreased to 18.8 in FY23. This
was enabled through the continuous
replacement of old trucks by Euro 6 trucks:
we increased from 67% in FY22 to 76% in
FY23 and through the addition of zero
emission vehicles within our Dutch
Commercial Waste division. Five zero
emission vehicles were ordered in FY23, two
of which have already been delivered and
put to work.
REDUCING OUR CARBON
FOOTPRINT ON SITE
On-site carbon emissions are those created
from our numerous on-site industrial
processes, from the on-site consumptions of
fuels for stationary sources, for example, and
from our electricity consumption.
Renewi operates multiple physical
processes to transform waste, including
anaerobic digestion, composting or
mechanical biological treatment, landfill,
incineration of waste (special types of waste
handled at ATM) and a remaining group of
emissions linked to standard or waste
specific activities. Many of these processes
are carbon intensive by nature. The amount
by which we can reduce them is limited by
the physical properties of our processes.
Despite this, good management and
increasing efficiency remains within our
control. We continue to carefully monitor
uncontrolled digestion of compost, thereby
avoiding spikes of methane. We also capture
the majority of landfill gas generated, which
is transformed into energy. We focus on
minimising any losses in these processes.
Regarding our carbon reduction ambition,
solutions like carbon capture may
become a strategic lever in our overall
decarbonisation strategy.
In the last year, our process emissions did
decrease through lower handled volumes in
Mineralz & Water due to portfolio changes
and lower composted volumes in our two
commercial waste divisions for example. In
FY22, our restated on-site carbon intensity
Strategic reportGovernance reportFinancial statementsOther information 58
Sustainability strategy focus CONTINUED
Commercial Waste NL,
Amsterdam
locations. Today eight sites in our Dutch
Commercial Waste Division have solar
panels and further discussions with our
energy supplier aim to extend this
• We are looking at the electrification of
various generator-driven processes and
machines on site
• We are looking at technical solutions to
reduce the process emissions from our
on-site waste transformation activities.
External experts are involved to get a large
scope of technical options
• We are investigating the impact of
increasing the energy efficiency of our
buildings
Mineralz & Water
• At our ATM facility, we are working on new
ways to capture emissions arising from the
pyrolysis process for decontaminating soil.
ATM has been taking part in the DIMMER
(Decarbonising the Industry in Moerdijk by
Managing Emissions Regionally) project.
The aim of this long-term project is to
explore collaboration between companies
at Moerdijk to create an emission
collection network to lower carbon
capture costs and maximise capture rates.
Specialities
• Coolrec – we aim to replace electrostatic
separation equipment to reduce natural
gas consumption on site. We will also be
installing solar photovoltaics at our
Dordrecht site, which will provide around
25% of the site’s energy
• Maltha – we aim to keep increasing the
consumption of renewable electricity
• Municipal – we have a continuous
improvement plan to reduce idling time.
This has already resulted in reduced fuel
consumption overall
Building a scope 3 reduction roadmap
Renewi is currently starting to build an
action plan to reduce by 25% its indirect
scope 3 emissions. A strategy with key group
of suppliers, customers and players from our
upstream and downstream activities will
follow. Open communication and
transparency within our value chain will be
necessary to design collaborative pathways
to lower overall scope 3 carbon emissions.
OUTLOOK BY FY31
Following the work in FY23, we have
committed to set near-term science based
targets to the Science Based Targets
Initiative (SBTi). Our application process has
started and we are planning on submitting
our targets for validation by SBTi over the
coming months.
In parallel, finalising and consolidating
carbon reduction roadmaps from each
divisions, building the overall pathway for
Renewi and looking for synergies internally
and externally remain high on the agenda.
Renewi plcAnnual Report and Accounts 2023 59
Climate-related Financial
Disclosures (TCFD)
This is our second disclosure and we will continue developing our internal climate-
related processes and associated disclosures in the coming years.
Climate change and sustainability are at the
core of Renewi’s purpose to protect the
world by giving new life to used materials.
As a waste-to-product company, we enable
the circular economy and contribute to
climate change mitigation by providing
recycled, lower-carbon secondary raw
materials. As such, our strategy is driven by
supporting the effort of keeping global
warming to 1.5°C and capitalising on
opportunities provided by the transition to a
low-carbon economy.
Historically, we have considered and
assessed the Group to actively support other
companies’ contribution to keep global
warming to 1.5°C by enabling carbon
avoidance outside our Group’s own value
chain. From a transition perspective, this is
due to our position as a leading waste-to-
product company. We have not yet been
significantly impacted by physical climate
change. However, we are continuing the
integration of the Task Force on Climate-
related Financial Disclosures (TCFD)
framework into our processes. Accordingly,
we are now considering climate-related risks
and opportunities in a systematic,
comprehensive, and consistent way. This
will continue to evolve over time to meet the
increasing needs of these risks as well as the
disclosure needs of all stakeholders related
to them.
STATEMENT OF COMPLIANCE
Renewi first reported in line with the TCFD
recommendations in our FY22 Annual
Report. This is our second consecutive year
of TCFD reporting. We have complied with
the requirements of the Financial Conduct
Authority, in particular LR 9.8.6R, by
including climate-related financial
disclosures consistent with the
recommendations of the TCFD across its
four pillars. Areas in which we have made
progress this year and in which we continue
to develop our climate-related disclosures
are described throughout this section, such
that we explain our alignment to the eleven
TCFD recommendations. Below is a
summary of TCFD recommendations which
we have not fully adopted yet, along with
our plans to improve in the upcoming years:
• Strategy – S(c): while we have performed a
qualitative risk and opportunities
assessment, we have yet to quantify the
identified risks and opportunities. We
have done a first pilot for two risk and
opportunities, and are planning to expand
this towards the full set of risks and
opportunities over the coming years.
• Metrics & Targets – M(b): we have
quantified our Scope 3 carbon footprint
for the first time, covering our FY22
baseline only. We are in the process of
doing the same for our FY23 scope 3
emissions and plan to complete this
exercise in the upcoming months.
• Metrics & Targets – M(c): we are
determined to follow the SBTi guidance
towards a net-zero decarbonisation plan.
We have committed to set near-term
targets and will focus the upcoming year
to build a decarbonisation roadmap
towards this target. In following years we
will extend this plan towards net-zero.
GOVERNANCE
STRATEGY
RISK MANAGEMENT
METRICS & TARGETS
G
S
R
M
a) Describe the board’s oversight of
climate-related risks and
opportunities.
a) Describe the climate-related risks
and opportunities the organisation
has identified over the short,
medium, and long term.
a) Describe the organisation’s
processes for identifying and
assessing climate-related risks.
b) Describe management’s role in
assessing and managing climate-
related risks and opportunities.
b) Describe the impact of
climate-related risks and
opportunities on the organisation’s
businesses, strategy, and
financial planning.
b) Describe the organisation’s
processes for managing climate-
related risks.
a) Disclose the metrics used by the
organisation to assess climate-
related risks and opportunities in
line with its strategy and risk
management process.
b) Disclose Scope 1, Scope 2, and, if
appropriate, Scope 3 greenhouse
gas (GHG) emissions, and the
related risks.
c) Describe the resilience of the
organisation’s strategy, taking into
consideration different climate-
related scenarios, including
a 2°C or lower scenario.
c) Describe how processes for
identifying, assessing, and
managing climate-related risks are
integrated into the organisation’s
overall risk management.
c) Describe the targets used by the
organisation to manage climate-
related risks and opportunities and
performance against targets.
Strategic reportGovernance reportFinancial statementsOther information
60
Sustainability strategy focus CONTINUED
GOVERNANCE
Climate-related matters are considered at
every management level of the organisation
whenever key decisions are made, with the
ultimate responsibility residing with the
Board. Over the past year, we have taken
active steps to improve our climate-related
governance. This included a workshop
focused on climate governance attended by
the Chief Executive Officer (CEO), Chief
Financial Officer (CFO) and several senior
management positions across functions,
such as Strategy, Finance, Risk and
Sustainability. This workshop served as an
upskilling exercise, aligning processes and
priorities related to climate governance. It
allowed us to come together to discuss the
way forward for Renewi and we have taken
away tangible steps to improve our
governance, which are described below.
G(a) Board oversight
The Board considers climate
change issues when reviewing and
guiding strategy and investment decisions.
The Board also has ultimate responsibility
for ESG, sustainability and climate-related
risks and opportunities. For example, the
Board requires each organic investment as
well as every M&A or divestment proposal to
cover its impact on the company’s carbon
footprint and recycling rate. It also sets ESG
related performance objectives for
management. Finally, this also includes
approving Renewi’s climate-related risks
and opportunities included in the risk
register and setting climate-related targets.
Climate change is discussed at least every
six months through updates from the
Executive Committee, during which progress
against set targets is discussed.
To clarify responsibilities between the Board
and Audit Committee, the Audit Committee
has updated its terms of reference to
explicitly include its climate-related tasks,
which are to review climate-related
assessments and associated methodologies,
ensure compliance with all relevant
standards and regulations, and track
progress towards targets.
Given the high importance of climate
change to the purpose and values of
Renewi, many Board members have good
knowledge of climate change in a
commercial context. For more information
on their experience, please see pages 106
to 107.
In recognition of the importance of
climate-related disclosures to a broad range
of stakeholders, the Board regularly
discusses climate-related issues with the
intention to enhance review, assessment,
modelling and reporting on these risks with
increasing detail.
G(b) Management’s role
Within the Executive Committee,
the CEO has responsibility for
communicating climate-related issues to
the Board. The CFO is responsible for
guiding climate risk management, and the
Strategy and Business Development
Director is accountable for driving
climate-related strategies. The Executive
Committee reviews investment decisions,
including for climate-related risks and
opportunities, on an ongoing basis. It is
responsible for overseeing strategy and
targets, reviewing progress, and managing
roadmaps and specific projects to meet
targets. Climate change is a standing
agenda item at quarterly Executive
Committee meetings, following which
updates are communicated to the Board at
least every six months.
The TCFD Steering Committee is
responsible for our TCFD reporting strategy
and to continue embedding climate-related
risk management into our existing
enterprise risk management framework.
The Committee includes experts from all
divisions, Strategy, Central Finance,
Procurement, Risk and Sustainability.
The Committee meets regularly throughout
the year.
Our Sustainability function is responsible for
day-to-day management of climate-related
matters at the management level and for
reporting progress against our climate, ESG
and sustainability targets. The Sustainability
Manager collects climate-related
information from the Divisions and updates
the Executive Committee on progress. This
year, the Sustainability Manager has put in
place Sustainability Leads across all
divisions and key functions who will be
responsible for strategy implementation
and data collection at the division and
function level.
We are actively managing the company’s
knowledge base on climate change and
sustainability and its importance to our
purpose and values. To this end, we
are working to include education on
climate change and sustainability in
our onboarding sessions and in our
online training materials accessible for
all employees.
At 242m, this is the
tallest wind
turbine on the
Belgian mainland,
supplying green
power to our
Ghent site
To view our corporate governance
framework, see page 115.
STRATEGY
S(a) Our identified climate-related
risks and opportunities
We have worked alongside a
leading global sustainability consultancy,
ERM, to identify relevant climate-related
risks and opportunities and assess the
materiality of these issues aligned with our
Enterprise Risk Management framework. In
our risk identification process we have
considered the categories of risks and
opportunities outlined by the TCFD and
across time horizons of short-term to 2025,
medium-term 2025 to 2030, and long-term
2030 to 2050. More information on our risk
assessment process is provided on pages 98
and 99 in the Risk management section of
this disclosure. For transition risks and
opportunities, we are in the early stages of
assessing current mitigation measures, in
Renewi plcAnnual Report and Accounts 2023 61
sustainability and climate related
developments. This is then the basis for
developing a set of goals. These goals and
ambitions range from GHG emissions
avoidance by recycling and supporting the
circular economy, to investing in the
commercialisation of innovative recycling
techniques to reduce waste and increase the
quantity and quality of secondary materials.
We are also investing in decarbonising our
operations, to help us better align with the
global effort to limit global warming to 1.5°C
(see chapter Reduce our carbon emissions).
In addition, Renewi is entirely green-
financed for its core debt. These instruments
are issued under the Renewi Green Finance
Framework aligned with the Green Bond
and Loan taxonomy and principles.
We have identified three sustainability
themes in our sustainability strategy of
which two are directly linked to and
impacted by climate change and the
opportunities and risks assessed in our
scenario analysis: Enable the circular
economy and Reduce our carbon emissions.
These are outlined in detail on pages 50
and 54.
At its core, Renewi is focused on creating
products from waste by recycling to help
avoid unnecessary raw material
manufacture and associated resource
depletion where possible, avoiding millions
of tonnes GHG emissions in value chains
every year through the re-use of materials.
This trend reflects the growing demand for
recycled products and the rising importance
of scope 3 emissions, which increases
demand for our services from companies
looking to reduce supply chain emissions.
Our role in the circular economy allows us to
avoid significant GHG emissions as well as
preserving scarce natural resources by
recirculating materials. This is reflected in
our transition opportunities describing
light of the scenario analysis findings, to
understand whether they are sufficient or
not. Therefore, only planned mitigation
approaches are listed. For physical climate
risks, our risk management process already
considers some mitigation measures and
these are therefore listed as current
mitigation approaches.
The two tables on pages 64 and 65 provide
details on the key risks and opportunities
that we consider most material to us.
S(b) The impact of climate-related
risks and opportunities on
our strategy
Our business and strategy are inherently
centred on goals and ambitions relating to
climate change and sustainability. We run an
annual strategic planning process as an
input to the annual financial planning
process during which each Division analyses
their specific market context covering
Strategic reportGovernance reportFinancial statementsOther information 62
Sustainability strategy focus CONTINUED
Transition scenarios selected for Renewi’s scenario analysis:
Source
Description
NET-ZERO BY 2050
International Energy Agency (IEA) 2
STATED POLICIES
A pathway that limits global warming to 1.5°C
through stringent climate policies and
innovation. This reaches net-zero CO2 emissions
by 2050
A scenario considering currently stated policies,
without additional policy implementation. It
takes granular, sector-by-sector data, looking at
existing policies and measures as well as those
under development. It roughly aligns with a 3°C
temperature outcome in 2100.
Physical scenarios selected for Renewi’s scenario analysis:
Source
Description
REPRESENTATIVE CONCENTRATION
PATHWAY (RCP) 4.5
Intergovernmental Panel on Climate Change (IPCC)
REPRESENTATIVE CONCENTRATION
PATHWAY (RCP) 8.5
This represents a scenario that assumes
implementation of emissions management and
mitigation policies, closest aligned to the
current commitments under the Paris
Agreement
This is a ‘business as usual’ scenario that
assumes, through limited co-ordinated action,
the world continues emitting significant
amounts of GHGs through the century, with
warming continuing to 2100. It is the closest
aligned scenario to current emissions trends
and the current rate of warming.
2. IEA data was supplemented by market- or technology-specific trends from other equivalent sources.
different trends that ultimately will benefit
Renewi by allowing us to grow our revenue
and product offering. The core metrics
we use to assess our progress against
these opportunities are our recycling rate
and avoided emissions. These metrics
are reported in the chapter Enable the
circular economy.
However, some recycling activities, and
particularly the increased valorisation of
those materials to high-quality secondary
materials, require energy to sort and treat
through successive processes. Increasingly,
these more sophisticated techniques
increase energy consumption and hence our
own GHG emissions for a greater benefit in
the full value chain. This is reflected in our
transition risk ‘Increasing pricing of GHG
emissions’. Acknowledging this increasing
intensity, we continue to decarbonise our
operations. For more information on our
decarbonisation efforts and our GHG
footprint, please see the chapter Reduce our
carbon emissions.
In response to increased impacts from
extreme heat, we are continually investing to
avoid and mitigate the impact of fires as one
of the greatest operational risks in the waste
industry. These investments are in processes
and systems of fire prevention, detection,
and suppression. Smart technology such as
cameras supported by artificial intelligence
plays an important role and is being
deployed on sites.
S(c) Our view on strategic resilience
We consider our current business
model and strategy to be resilient
to the transition to a lower carbon economy.
This is because, on balance, this transition
presents more opportunities for Renewi
than risks considering our position in the
circular economy. This conclusion is based
on the assessment of our material risks and
opportunities under different future
scenarios. Next to the transition risks and
opportunities, physical climate change
poses risks to our operations and supply
chain. However, mitigation measures are
either already in place, or are in the process
of being further developed.
Last year, we completed an initial,
qualitative scenario analysis to better
understand the potential timing and future
materiality of key climate-related risks and
opportunities. We used globally recognised
datasets that give insight into the possible
risk and/or opportunity trends associated
with low- and high-carbon futures. This
supports better planning and preparation
for alternative outcomes. The scenarios
used in the assessment are shown in the
tables above. The outcomes of the scenario
analysis were reviewed by the TCFD Steering
Committee and findings were presented to
the Executive Committee and subsequently
to the Board to validate the most significant
risks and opportunities for our business.
The IPCC has recently published updated
scenarios, referred to as Shared
Socioeconomic Pathways. Next year, we are
planning to update our physical scenario
analysis using these new scenarios.
To further substantiate our resilience we will
start to quantify the risks and opportunities
of climate change. Although we have started
this process, we are not yet ready to share
outcomes as we have only piloted two of
our highest physical and transition risks
(‘Increasing pricing of GHG emissions’ and
‘Water stress and drought’). From this pilot,
we have made great progress in our
understanding of these risks, the data needs
associated, and the awareness across the
Group. The models have also started
Renewi plcAnnual Report and Accounts 2023 63
relevant. In future, we are planning to
update the assessment every two years.
Instead this year, we have focused on
incorporating climate risks into our wider
risk management framework (see R(c)) and
starting to quantitatively assess our highest
risks (see S(c)).
R(b) Our processes for managing
climate-related risks and
opportunities
We have taken stock of existing mitigation
efforts for key risks and have outlined our
strategy for capitalising on identified
opportunities in our risk and opportunity
tables on pages 64 and 65. Mitigating
actions for key identified risks are included
in the risk chapter on pages 98 to 99. As a
next step, we plan to assess whether these
measures are sufficient considering the
results of our next scenario analysis exercise.
R(c) Integration of climate-related
risk factors into risk
management
In the assessment process, climate-related
risks have been considered up to 2050. This
differs from our enterprise risk management
framework that we use to conduct risk
stakeholder workshops including the TCFD
Steering Committee and business division
representatives to develop an inherent risk/
opportunity profile. Time-frame is separated
from likelihood due to the long-term nature
of some climate issues, which goes beyond
the typical time-frame for enterprise risk
management. Likelihood and impact were
scored on a scale of 1–5, from highly
unlikely/insignificant to almost certain/
severe, matching the existing Renewi ERM
categories. Scenario analysis was applied
to the most material risks and opportunities.
Risks were assessed on an inherent basis
to understand the baseline risk exposure.
This means any mitigation efforts already
in place have not yet been fully considered,
which would result in a current risk
profile. Risks are assessed in this way
so that existing mitigation measures
can be compared to the perceived change
in baseline conditions to determine whether
they would still be sufficient to manage
the risk. Our scenario analysis approach
is described in the Strategy section of
this disclosure.
This year, we have not updated our scenario
analysis as we still consider the results
internal conversations on how we may use
the outputs to aid in strategic decision-
making. Going forward, we will continue to
further improve the models using better
data and applying them to other risks and
opportunities as well as other financial
impact metrics.
RISK MANAGEMENT
R(a) Our process for identifying and
assessing climate-related risks
Last year, we conducted our first
climate-related risk identification exercise. In
assessing climate-related risks and
opportunities, we have followed the
categories outlined by the TCFD. We
identified a long list of relevant physical and
transition risks and opportunities that the
business is potentially exposed to. In
developing the longlist we have considered
changing regulatory requirements with
respect to climate change as a key potential
source of risks. This exercise prioritised the
risk analysis on our top 40 sites, across all
technologies and territories.
We then qualitatively assessed the
time-frame, likelihood, and impact of
identified risks and opportunities through
Electric vehicle at our BDR waste
management contract in the UK
Strategic reportGovernance reportFinancial statementsOther information 64
Sustainability strategy focus CONTINUED
Transition opportunities
CATEGORY KEY OPPORTUNITY
COMMENTARY
TIME HORIZON
POTENTIAL FINANCIAL
SCENARIO TREND
PLANNED MITIGATION APPROACHES
Products
& Services
Increasing pricing of GHG
emissions
If the Group can monetise the realised carbon avoidance its services provide this
could provide a growing revenue stream.
To 2025
IMPACT AREA
Revenues
SIGNIFICANCE
Higher opportunity
Products
& Services
Development of waste stream
recycling activities that support
the low carbon transition
Products
& Services
Enhanced climate change
regulation & reporting
Producing valuable and highly sought-after transition materials from waste
benefits the Group by increasing demand for their services and products.
2025 to 2030
Revenues
Higher opportunity
Continuing development of climate change regulation could increase
competitiveness because the Group is well prepared and lobbying for positive
change.
2025 to 2030
Revenues
Moderate opportunity
We aim to be a leader in sustainability, and push what is necessary in order to
Markets
Increasing cost of materials
Higher revenue, due to prices of recycled materials becoming more competitive
as cost of raw materials rise.
2025 to 2030
Revenues
Moderate opportunity
Markets
Circular economy principles
Being a circular economy specialist allows for expansion of our offerings.
To 2025
Revenues
Lower opportunity
Products
& Services
Increasing importance of scope
3 emissions
Increase in customers who may need to reduce emissions, leads to higher
revenue and product/service opportunities.
To 2025
Revenues
Lower opportunity
Investment in MyRenewi portal will create advanced customer dashboards
We aim to get broader recognition for the carbon avoidance we generate by
recycling as an offset for our customers’ emissions amongst legislators and
standard setting bodies.
We monitor the market for opportunities to recycle additional waste streams
and advancements in processing technologies to create the highest possible
product quality.
be recognised as such by the (international) rating agencies.
In order to replace virgin materials as much as possible, we invest in recycling
technologies that come as close as possible to the virgin alternative in terms
of specification and price.
We aim to maintain a leadership position by continuously investing in
advanced recycling technologies and acquiring new technologies and
capabilities.
that provide insight for customers to show recycling outcomes and
associated emissions.
Transition and physical risks
CATEGORY KEY RISK
KEY IMPACTED
GEOGRAPHIES
Transition
risks
Policy & Legal GHG pricing – increased
Across all
To 2025
regulatory changes
TIME HORIZON POTENTIAL FINANCIAL
IMPACT AREA
•
Operating costs
• Capital investment
SCENARIO TREND
SIGNIFICANCE
Higher risk
Policy & Legal Supply chain transparency
Across all
2025 to 2030
•
Revenues
Lower risk
leading to decrease in
volumes
Policy & Legal Lack of developing
Across all
2025 to 2030
• Revenues
Lower risk
Markets
climate policies
Changes in waste volume
and composition due to
reduce and re-use
principles
Across all
2025 to 2030
•
Revenues
Lower risk
Physical
risks
Acute &
Chronic
Extreme heat
Across all
To 2025
Chronic
Water stress & drought
Netherlands
2025 to 2030
Acute
Flooding
Netherlands,
Belgium, UK
2025 to 2050
Acute
Storms & wind
UK
2025 to 2030
• Operating costs
• Capital expenditure
• Revenues
• Operating costs
• Capital expenditure
• Revenues
• Operating costs
• Capital expenditure
• Revenues
• Operating costs
• Capital expenditure
• Revenues
Higher Risk
Moderate – Higher Risk
Moderate – Higher Risk
Moderate Risk
Risk considered in our pilot financial quantification exercise
Information on potential impacts and current and planned mitigation measures are provided in Risk management on page 86.
Renewi plcAnnual Report and Accounts 2023 65
Transition opportunities
Products
& Services
Products
& Services
Products
& Services
CATEGORY KEY OPPORTUNITY
COMMENTARY
TIME HORIZON
Increasing pricing of GHG
If the Group can monetise the realised carbon avoidance its services provide this
To 2025
emissions
could provide a growing revenue stream.
POTENTIAL FINANCIAL
IMPACT AREA
Revenues
SCENARIO TREND
SIGNIFICANCE
Higher opportunity
Development of waste stream
Producing valuable and highly sought-after transition materials from waste
2025 to 2030
Revenues
Higher opportunity
recycling activities that support
benefits the Group by increasing demand for their services and products.
the low carbon transition
Enhanced climate change
Continuing development of climate change regulation could increase
2025 to 2030
Revenues
Moderate opportunity
regulation & reporting
competitiveness because the Group is well prepared and lobbying for positive
Markets
Increasing cost of materials
Higher revenue, due to prices of recycled materials becoming more competitive
2025 to 2030
Revenues
Moderate opportunity
change.
as cost of raw materials rise.
Markets
Circular economy principles
Being a circular economy specialist allows for expansion of our offerings.
To 2025
Revenues
Lower opportunity
Products
& Services
3 emissions
revenue and product/service opportunities.
Increasing importance of scope
Increase in customers who may need to reduce emissions, leads to higher
To 2025
Revenues
Lower opportunity
PLANNED MITIGATION APPROACHES
We aim to get broader recognition for the carbon avoidance we generate by
recycling as an offset for our customers’ emissions amongst legislators and
standard setting bodies.
We monitor the market for opportunities to recycle additional waste streams
and advancements in processing technologies to create the highest possible
product quality.
We aim to be a leader in sustainability, and push what is necessary in order to
be recognised as such by the (international) rating agencies.
In order to replace virgin materials as much as possible, we invest in recycling
technologies that come as close as possible to the virgin alternative in terms
of specification and price.
We aim to maintain a leadership position by continuously investing in
advanced recycling technologies and acquiring new technologies and
capabilities.
Investment in MyRenewi portal will create advanced customer dashboards
that provide insight for customers to show recycling outcomes and
associated emissions.
assessments for the wider business, where
time-frames are aligned to our five-year
strategic planning exercise. This year, we
have integrated climate risk into our
enterprise risk management framework
through the implementation of a new risk
management tool. This gives visibility to
climate-related risks across functions and
divisions and incorporates them into regular
risk management processes at division and
site level. The climate-related risks have also
been included in the risk radar. Risks
relevant within the next five years are
included within the regular time-frame,
climate risks outside this time horizon are
included outside the regular time-frame.
For our enterprise risk management
framework and risk radar, please see pages
87 and 90.
METRICS AND TARGETS
M(a) M(b) Our climate-related
metrics
Renewi has an existing
set of metrics to manage and assess
climate-related risks and opportunities. The
metrics are reported in our sustainability
strategy chapters Enable the circular
economy and Reduce our carbon emissions.
The base year against which progress is
measured is FY22. For our GHG footprint
methodology, we follow the GreenHouse
Gas Protocol. FY22 is the first year for which
we have complete scope 1, 2 and 3 data and
we are seeking limited assurance for scope
1&2. Our GHG footprint is reported in the
chapter Reduce our carbon emissions on
page 54. This chapter also includes some of
the underlying drivers including fuel and
energy use.
Our commitment to contribute to the fight
against climate change is also reflected in
the way we evaluate performance. To
motivate senior executives and managers to
increase climate-related performance, we
have an annual bonus plan and long-term
incentive plan (LTIP) in place that includes
sustainability metrics such as our recycling
rate. Further consideration is under way to
assess the appropriate climate-related
performance metrics to be included in the
LTIP programme.
We consider carbon pricing legislation in
the countries we operate in, but we do
not have an internal carbon price in place
yet. This year, we have made progress in
understanding our potential exposure
to the impact of carbon pricing on our
operations through our financial
quantification exercise.
Due to the nature of our business, we
consider most of our reported metrics to fit
the definition of climate-related opportunity
metrics, for example recycling rate, carbon
emissions avoided and secondary materials
produced. These metrics help us understand
and track progress against identified
transition opportunities. We also engage in
lobbying for regulation around avoided
emissions. For more information, see the
chapter Enable the circular economy on
page 50.
M(c) Our climate-related targets
When setting climate-related
targets, we analyse government
targets, pledges in countries where our sites
are located, as well as our past performance
and drivers of performance improvements.
This year, we have started internal
discussions on our decarbonisation
ambitions for 2030 and have submitted our
near-term science-based target aligned with
a 1.5°C pathway, to the Science-Based
Targets initiative (SBTi). Beyond 2030, it is
our goal to get to become net-zero,
following SBTI’s definition (https://
sciencebasedtargets.org/net-zero). This
means that we don’t consider offsetting for
more than 10% of our emissions. Part of our
decarbonization efforts will be to determine
our target year for this ambition. For more
information on our decarbonisation efforts,
please see the chapter Reduce our carbon
emissions on page 54. Additional climate-
related targets are reported in our
sustainability strategy section of this report
(page 50) and mapped to existing metrics
we report annually.
Strategic reportGovernance reportFinancial statementsOther information 66
66
Renewi plc
Annual Report and Accounts 2023
Customer Care
Amersfoort
Renewi plcAnnual Report and Accounts 2023 67
S U S T A I N A B I L I T Y S T R A T E G Y F O C U S :
Care for people
Caring for our people is an essential core value at Renewi. Their wellbeing is
paramount and ensures we are able to deliver on our purpose.
OBJECTIVE
METRIC
Deliver people
home safe and
well every day
Lost time/Injuries rate (LTIF)
(number LTI x x1000000) / number
of hours worked
Employee mood
(‘mood’ score in Pulse)
PROGRESS TO DATE
FY21
14
FY22
8.9
FY23
9.3
7.2
7.3
7.4
Make Renewi a
rewarding, diverse
and inclusive working
environment
Healthy at work rate
(% healthy employees)
Employee engagement
(eNPS score in Pulse survey)
94.8%
93.9%
92%
+14
18%
22%
Females in higher management
(% of all employees)
20%
22%
24%
OBJECTIVE
METRIC
Positively impact
our communities
Number of complaints
(number of substantiated
complaints received annually)
PROGRESS TO DATE
FY21
356
FY22
156
FY23
133
2025 TARGET
7
7.5
(+5%)
96.0%
+30
(doubled)
30%
(+7% points)
2025 TARGET
Major environmental incidents
and Major fires (absolute figure)
28
19
3
0
SDG alignment
Progress summary
Provided financial support amid
rising living costs and inflation
Our workforce comprises 20%
women and 24% of leadership
positions are held by women
(FY22: 22%)
Having the right culture will enable the
company’s long-term success, and a strong
sense of purpose across the organisation
will help us achieve our goals. Our focus
on being a diverse and inclusive employer
continued, alongside a renewed focus on
wellbeing. Our employees are our most
valuable asset and ensuring they are safe
and well at work is of fundamental
importance. As our ambassadors it is
crucial they are aligned with and share
our passion for our purpose and our
business objectives.
We have run three Pulse surveys this year
with a response rate of 70% (FY22: 70%).
Employee mood received a score of 7.4 out
of 10 (FY22: 7.3). During the year we have
dedicated extra attention to following up
on the insights from the Pulse surveys.
HEALTH AND WELLBEING
Our aim is to support our employees to be
healthy, productive and to enjoy their work.
We are aware current macroeconomic
issues are putting a strain on our people.
We work with managers and HR to ensure
those experiencing hardship can be
identified and supported.
We engage with our employees on a variety
of platforms, and our specialist healthcare
professionals can aid employees with
wellbeing problems. Support is tailored to
Strategic reportGovernance reportFinancial statementsOther information
68
Sustainability strategy focus CONTINUED
the individual employee, rather than a
one-size-fits-all approach.
Amid rising living costs and inflation, we
were pleased to be able to offer some extra
help to our employees who fall outside the
Renewi Bonus scheme. These individuals
received a one-off payment of €250 gross in
January 2023.
In spring 2023 we launched a global
vitality programme, which amalgamates
all our existing health initiatives into one.
We continue to build on our sickness
prevention initiatives.
A recurring activity to support the health and
wellbeing of our employees is the RUNewi
challenge. Once again, this year a large
proportion of our staff teamed up to
exercise and boost physical and mental
health, while raising funds for our chosen
mental health charities.
LABOUR MARKET
Despite challenges in the labour market,
most notably staff shortages, we have loyal
employees who are committed to our
purpose and value the Renewi community.
This is borne out by good employee
retention rates of 12%. We know our purpose
is becoming increasingly appealing as
society places ever greater importance on
the environment. Our talent acquisition
team filled 978 vacancies of which 29% are
female colleagues.
DEVELOPING OUR FUTURE
LEADERS AND NURTURING TALENT
We want to give our employees
opportunities to grow and we nurture future
talent. We ensure prospective leaders are
fully prepared to lead and have the right
skills to do so.
As part of our performance management
cycle, we conduct annual talent reviews
for all office-based employees above a
certain grade. We actively use data from
the review to provide our people with
development opportunities. This year, we
expanded the scope to further enrich our
data for talent acquisition.
For those who are office-based, we have
new training programmes in place – for
example, programmes in SHEQ and sales
aim to give people more opportunity to
progress in their area of work.
We launched our talent lunches, where
selected employees have a meeting with
Board members, to discuss Renewi in
general. This open dialogue is invaluable
and demonstrates we are listening and
responsive to ideas and feedback.
TALENT, DEVELOPMENT AND
LEADERSHIP PROGRAMMES
We always look to secure the best talent for
the future, and have invested in multiple
programmes to support our existing, future
and potential leaders.
LEAD is the Renewi leadership development
programme launched in 2019. It has been
expanded to offer training, development
and support for managers, with uniformity
across Divisions. In FY23 we trained 609
leaders in our organisation.
The current LEAD programme will conclude
in the coming year, to be replaced by an
exciting new training plan for incoming
leaders and new starters, tailored to people’s
specific role and development needs.
Our Future Leaders programme is designed
for those with potential, helping them to
develop the skills to become a leader of the
future. The pilot received strong, positive
feedback and will likely be rolled out across
the organisation.
Pro
vid
e d
ir
e
c
t
i
o
n
Translating the
strategy and
creating a direction
that inspires others
Renewi leadership development
model used in LEAD programme
Drive for res ults
Realising goals and
being responsible
for results
Role Model
Being an exemplary role
model and taking the
lead in promoting
and showing our values
Continuous
personal
development, open
to feedback and
self-aware
f
l
e
s
r
u
o
p y
Develop, grow and
motivate your team
and individuals.
This is top priority
Develop your te
elo
v
e
D
am
Renewi plcAnnual Report and Accounts 2023 Hydraulic separation used for
recycling fridges and air conditioners,
Coolrec, Dordrecht
69
Leaders at Renewi place great importance on
supporting the next generation and
contributing to society. We strongly support
the placing of interns across many different
departments, attached to different leaders,
and in FY23 we placed 24 interns.
special prize for office-based employees
who have gone above and beyond in their
performance. They received a set of shares
redeemable in three years, an engraved
present and a dinner hosted by CEO Otto de
Bont and HR Director Helen Richardson.
AWARDS
To underline our company values, each year
we award six individuals or groups from across
our organisation for exceptional role modelling
of one of our six values. These employees are
celebrated with an award during a dinner with
our senior leadership team.
In addition, in FY23 six of our top performing
employees received a Star Award. This is a
ONE REWARD
We finalised the harmonisation of all
reward policies in the Netherlands and
the UK, with Belgium to follow. This
means our employees can be confident
we have a fair and transparent reward
system in each country. We have optimised
our HR processes, leading to greatly
enhanced data quality and process
efficiency. Further to harmonising rewards
in the Netherlands and the UK, we are
looking at simplifying and unifying rewards
in Belgium.
DIGITISATION
The digitisation process is ongoing with the
aim to improve our HR processes and
communications with our employees.
This year we focused on preparing for
implementation of Workday, a HR software
solution, which will start in June.
We continue to optimise our internal
communications channels, to encourage
two-way communication and improve the
way we engage with our frontline staff.
Strategic reportGovernance reportFinancial statementsOther information 70
Sustainability strategy focus CONTINUED
ETHICS, COMPLIANCE
AND PEOPLE
We have an active D&I Board which
takes actions to ensure Renewi remains
a diverse and inclusive company. In
FY23 we didn’t increase toward our
goal of reaching more female within
the workforce (FY23: 20% and FY22: 20%),
but increased up to 24% of women in
leadership positions (FY22: 22%), and
took actions to create a working
environment welcoming to women,
offering flexible working and female
work gear. Our unconscious bias training
programme for managers was launched,
where participants learn how to recognise
and deal with their own biases to create
a more inclusive working environment.
We recognised Ramadan as an important
cultural celebration, and published a
video in which two colleagues explained
what it means and provided managers
with information on how to support
participating team members.
Compliance is becoming more
challenging amid increasing regulation.
However, we continue to work hard
in this area, and this year our Compliance
leadership visited more than 50% of
Renewi sites to better understand
the business, our environmental
compliance experts and the systems
in use. This evidenced the passionate
and responsible specialists we have
on board, and because of this our
site-level ISRS scores on compliance
were relatively high.
Communities
Being a positive force in
our communities is
fundamental to who we
are and what we do.
Being a positive force in the communities
around us is fundamental to who we are
and what we do, and we work to minimise
the impact of our operations on local
communities.
Processing discarded items can have quite
an impact on neighbouring communities.
Our site managers across our 154 sites,
supported by their local SHEQ leader,
maintain an open dialogue with their local
communities to avoid any issues. When
complaints arise, they collect, identify and
understand flagged concerns as soon as
possible. The objective is to always act
quickly (taking corrective actions and
managing incidents with specific plans of
action) where required to mitigate any
impacts, while always maintaining an open
communication on status, progresses and
next steps
The SHEQ team reports on and tracks the
number of complaints each quarter. These,
along with the actions taken, are registered
in our central system. In FY23 the number of
complaints continued to remained low. This
is because of a concerted effort to reduce
complaints through technology investment,
staff awareness training and active
communication with communities.
Wherever we operate, Renewi reports on
significant environmental incidents. This
refers to incidents that take place on site and
have an impact on the local environment and
vicinity of our operations. Next to spills or
emissions to soil, water and air, fires remain a
major risk in the waste industry. We have
undertaken measures to address this,
including improvements to waste storage and
investment in technology. Renewi and the
wider industry also works with regulators to
improve dangerous waste-handling
legislation and educate community members
around separation and enforcement, to
ensure when the waste arrives on site it is as
safe as possible.
During FY23 we had no significant
environmental incidents, but three significant
fires took place during the second half of the
year. With a total number of three events to
report this year, we have improved significantly
versus FY22 with 19 events, and we are making
great progress toward our FY25 target.
Financial Shared
Services Centre,
Lommel
Renewi plcAnnual Report and Accounts 2023 Safety
Our priority is the health
and safety of our
employees, contractors,
customers and visitors.
We were devastated by the death of a
valued Renewi colleague at a site in the
Netherlands. We will go above and
beyond to prevent any future fatalities.
Renewi’s first value is Safety and we are
more committed than ever before to ensure
our employees can return home safe every
day. To further professionalise the SHEQ
organisation, we have invested in additional
positions at the start of this financial year. We
appointed a director of compliance at group
level. In addition we appointed a Group
SHEQ Manager CoE a Group SHEQ ISRS
Program Manager.
BUILDING A SAFETY CULTURE
SHEQ Campus
In the past year, we continued to perfect the
SHEQ Campus’s (previously the SHEQ
Excellence Campus) entry-level e-learnings.
A pilot rollout of various digital learning
modules is ongoing. Learner and expert-level
courses will be developed over the year.
Site traffic plan
To further improve and optimise our on-site
traffic management we have collected
internal and external best practices,
resulting in one upgraded standard to
optimally manage traffic-related risks across
all our sites.
Safety leadership
To drive our safety culture, we launched a
Safety Leadership programme, designed to
foster a culture of continuous improvement
71
Control room at M&W ATM
Moerdijk site
around safety awareness, which is
currently being rolled out. Commitment
to the programme will start at the top.
Executive Committee members are the first
to take the programme.
Renewi has also:
• appointed an ISRS programme manager;
• established a governance ISRS structure
for implementation;
• conducted a ISRS GAP-analysis in all four
Fire Safety
We continued to conduct and report on
fire safety. By sharing best practice,
identifying areas for improvement and
continuing to invest in fire safety, we saw
a reduction in major fires.
Implementation of the International
Sustainability Rating System (ISRS)
We are in the process of implementing
ISRS, an internationally recognised system
for measuring, improving and making
safety, environmental and corporate
performance visible and transparent. A
number of sites from each division were
thoroughly assessed on ISRS element five
‘compliance’. Despite the satisfying ISRS
score on compliance, we still have a
desire for a more systematic approach
and this is now part of our divisional ISRS
implementation plans.
divisions on the Processes and
Categories selected. This started with a
selection of six (out of the 15) ISRS
Processes, which are: Leadership,
Compliance, Risk Evaluation, Risk
Control and Risk Monitoring and Asset
Integrity;
• selected six (out of 10) loss categories,
which are: Occupational Health,
Occupational Safety, Process Safety,
Environment, Quality, Asset Integrity; and
• established the divisional ISRS
implementation plans on the six
Processes and six Categories selected.
Audits
Internal audits are carried out to monitor
and improve our SHEQ performance. We
continued to conduct and report on fire
safety in conjunction with emergency
preparedness audits, with excellent
co-operation from all sites. By sharing best
practice, identifying opportunities for
improvement and continuing to invest in
fire safety on site, we have seen a
significant reduction in major fires by 80%,
and hence a safer working environment.
Next year we will continue the internal
audits and include more ISRS elements
such as leadership, risk assessment, risk
control, risk monitoring, compliance and
asset integrity. We will also establish a new
comprehensive audit programme which
will be risk based, and audits will, besides
Operations and SHEQ, include IT, Finance,
Controlling and other relevant processes.
Health and safety performance
Indicator
Number fatal accidents
(number)
Lost time/Injuries rate (LTIF)1
(number LTI x x1000000) / number of hours worked
Number of Total Recordable Injuries (TRI)
Number of Total Time Injuries (LTI
1. LTI: accident which results in a person being off work for a day or more.
FY22
FY23
–
8.9
313
137
1
9.3
311
140
Strategic reportGovernance reportFinancial statementsOther information 72
O P E R A T I N G R E V I E W
Commercial Waste
The Commercial Waste Division is the market leader in the
Netherlands and Belgium. A strategically important 12
months included its first significant acquisition since the
creation of Renewi in 2017 and the deployment of €60m into
separate projects in Ghent, Puurs and Acht.
Division information
Operating sites:
96
Volume of materials
recycled:
3.9mT
(FY22: 3.7mT)
Employees:
5,013
Revenue:
Underlying EBIT:
€1,397m
(FY22: €1,360m)
€129.3m
(FY22: €135.7m)
Marc den Hartog, MD, Netherlands
Mark Thys, MD, Belgium
The Commercial Waste Division brings
in more than 70% of Renewi’s revenue.
The Division collects, sorts and recycles
waste materials from a wide range of
sources, playing a key role in the delivery
of Renewi’s business strategy. Our
primary focus is to provide cost-efficient
waste-to-product solutions for our
customers, but we continue to add
further value by offering advisory
services tailored to help our customers
manage waste more effectively, for
example, optimised source separation.
We offer innovative recycling
technologies, ensuring waste recovered
can be converted into high-quality raw
materials. We actively help our
customers meet their sustainability goals
by supporting product recycling,
reducing waste and minimising the
unnecessary use of virgin raw materials.
Waste is collected by our fleet of
predominantly modern, clean Euro 6 trucks
(read more about this on page 54), which is
sorted and processed at one of our 96 sites,
where we produce high-quality secondary
materials and recyclates. Only waste that
cannot be recycled is disposed of.
SUSTAINABILITY HIGHLIGHTS
Our overall recycling rate is continually
improving, now standing at 58.3% (FY22
55.0%), significantly aided by the
acquisition of Paro with its 78% recycling
rate. This acquisition and the new sorting
lines supporting VLAREMA 8 will directly
contribute to future improvements in
recycling rates, as will the ongoing success
of our investments.
We are optimising collection routes to
minimise pollution, upgrading our fleet to
low-emission Euro 6 vehicles and
introducing zero-emission vehicles and
electric cranes, loaders and shovels that
operate on our sites. We have also added
transport over water. This year 215 new
Euro 6 or higher-standard fleet vehicles
have been put into use, contributing to a
total of 1,488 which accounts for 76% (FY22:
67%) of the Division’s vehicles, and we
remain on track to achieve 100% in 2025.
Green Collective, our joint venture with
PreZero, is the first and leading white-label
commercial waste collection initiative in
the Netherlands that invites waste
companies to co-operate in their collection
of waste. This activity delivers a significant
contribution to safer and cleaner cities,
reducing traffic movements and emissions
with more than 30%. It is now operational
in 21 cities (FY22: 10) and is expected to
expand to all major municipalities in
future years.
We switched to 100% green electricity (from
wind farms) in the Netherlands since 2021,
and continue to install solar panels and
wind turbines on our sites to procure
renewable electricity.
Read more about Renewi’s sustainability
focus on pages 50 to 71.
MARKETS AND CUSTOMERS
Our market is divided into three segments:
• Industrial and Commercial (I&C)
– markets, sectors and businesses
covering the broader activities of the local
economy, including hospitals, factories,
offices, shops and restaurants. Waste
streams are preferably separated at
source to retain quality, however there is
still a significant flow of mixed waste
• Domestic – door-to-door municipal
collection. Once collected, waste is
delivered as instructed by the authority,
which retains responsibility for sorting,
treatment and disposal
• Construction and Demolition (C&D)
– arises from infrastructure, commercial
and residential construction, and is a key
sector for Renewi in the Netherlands
Renewi plcAnnual Report and Accounts 2023
73
Secondary material
Commercial Waste NL, recycled
wood for the panel board industry
Strategic reportGovernance reportFinancial statementsOther information 74
Operating review – Commercial Waste CONTINUED
The Commercial Waste Division also
operates several specific business lines.
These include the collection, separation
and aggregation for treatment of small-
packed hazardous waste, such as batteries,
paint and out-of-date pharmaceuticals, and
the collection and treatment of organic
waste streams from restaurants. We also
produce waste wood chips for furniture,
recycle mattresses, manage confidential
paper shredding and recycling, and have a
leading position collecting and processing
medical waste from hospitals.
For information on our customers, see
page 24.
STRATEGY EXECUTION
Nationwide coverage, density, operational
scale and advanced processing
technologies make the Commercial Waste
Division the market leader in the
Netherlands and Belgium. The last 12
months have seen the Division’s ambitious
plans closely aligned to the Group’s strategy
of organic growth, M&A, ground-breaking
innovation, a rapidly evolving market and
major investment, all serving to strengthen
its position.
As a response to Flanders’ VLAREMA 8
legislation, which stipulates 25 waste
streams are sorted separately to achieve
35% less residual waste by 2030, we have
transformed the way we sort our waste. We
are investing over €60m – more than any of
Commercial Waste financial performance
Netherlands Commercial
Belgium Commercial
Intra-segment revenue
Total (€m)
Year-on-year variance %
Netherlands Commercial
Belgium Commercial
Total
Netherlands Commercial
Belgium Commercial
Total
REVENUE
UNDERLYING EBIT
OPERATING PROFIT
FY23
932.0
468.4
(3.1)
FY22
896.2
466.9
(2.6)
1,397.3
1,360.5
4%
0%
3%
FY23
76.9
52.4
–
129.3
-17%
23%
-5%
FY22
93.1
42.6
–
135.7
FY23
69.4
65.3
–
134.7
-22%
62%
4%
FY22
89.1
40.4
–
129.5
UNDERLYING EBIT MARGIN
RETURN ON OPERATING ASSETS
FY23
8.3%
11.2%
9.3%
FY22
10.4%
9.1%
10.0%
FY23
19.3%
47.3%
25.4%
FY22
26.2%
46.2%
30.3%
The return on operating assets excludes all landfill related provisions. The underlying figures above are reconciled to statutory measures in notes 2 and 8.3 in the consolidated financial statements.
Renewi plcAnnual Report and Accounts 2023 75
Commercial Waste BE
Renewi’s first
significant
acquisition
The acquisition of Renewi Westpoort,
acquired from Paro, is an Amserdam-
based commercial waste and
recycling business, and was Renewi’s
first major acquisition since the
Group’s formation in 2017.
It is a state-of-the-art 130,000m2
sorting facility. The site has excellent
road and water access and operates
two advanced sorting lines for
processing mixed construction and
demolition waste, as well as bulky
household waste – a total of circa
300kT of waste handled annually.
In addition, a new minerals
classification and washing installation
enables the site to produce around
500kT annually of secondary
construction materials from
construction and demolition waste.
Renewi Westpoort is now a key site in
the Amsterdam region. The acquisition
will deliver synergies from site
rationalisation, route and waste flow
optimisation and other operational
benefits as a new part of the Group’s
Commercial Waste Division.
our competitors – and are creating new
sorting lines, setting a benchmark for
innovative sorting processes that exceed the
requirements of this legislation. Read our
VLAREMA 8 case study on page 77.
We also acquired Renewi Westpoort (Paro),
an Amsterdam-based construction and
demolition waste recycling business. It is the
Group’s first major acquisition since
formation in 2017 and is perfectly aligned
with our ambition to be the leading
waste-to-product company in Europe’s
circular economies and our strategy to grow
our market share.
Both our response to VLAREMA 8 and the
Renewi Westpoort acquisition align with our
strategy to invest in new and innovative
technologies which divert more waste from
incineration and landfill, and in doing so
provide an accretive return on investment
and growth in our profitable market share.
As the market continues to evolve in our
favour, Renewi is perfectly placed to
meet market demands and offer
opportunities to increase the spread of
our processing margins by adding value
to the products we make.
FINANCIAL PERFORMANCE
The Commercial Division increased
revenues by 3% to €1,397m. Underlying
EBIT fell by 5% to €129.3m, representing
an EBIT margin of 9.3%.
Revenues in the Netherlands grew by
4% to €932.0m and underlying EBIT fell
by 17% to €76.9m. Underlying EBIT
margins decreased by 210 bps to 8.3%
and return on operating assets fell to
19.3%. In Belgium, revenue increased
marginally to €468.4m and underlying
EBIT increased by 23% to €52.4m.
Underlying EBIT margins increased by
210 bps to 11.2%.
Strategic reportGovernance reportFinancial statementsOther information 76
Operating review – Commercial Waste CONTINUED
In the Netherlands we saw stable revenues,
with EBIT margins reduced from last year
due to an increase in labour costs,
exacerbated by the need to engage
temporary staff to cover shortages in
permanent labour.
Volumes in the Netherlands were reduced as
we saw the effects of lower organic waste as
greenhouse operations in the Netherlands
temporarily cut back on production in
response to higher energy costs, and a hot
dry summer led to a reduction in
compostable waste. We also saw a reduction
in construction and demolition volumes as
permissions for new building work were
slowed by environmental concerns
including nitrogen and shortages in some
materials due to supply issues. In the longer
term the need to reduce both carbon and
nitrogen in the construction sector will
prove to be an advantage to us as we bring
lower footprint materials into the market
through our recycling activities.
In this environment of volume declines we
exercised strong pricing discipline, ensuring
that to the extent that it was possible costs
were passed on to customers. Customer
loyalty remained strong, and we were
delighted to win a major contract at
Schiphol Airport Group where we were
selected for both the quality of our services
and our demonstrable commitment to the
circular economy.
During the year we completed the
acquisition of the operations of Renewi
Westpoort – a significant player in the Dutch
market which will increase our leading
position in our core construction and
demolition sector and will also give us better
nationwide coverage. Optimisation and
integration of the facilities is ongoing with
some initial issues affecting performance
which caused disruption to the normal
operation of the plant. We are confident in
the underlying strength of this business and
have already seen an improvement in the
final months of the year.
In Belgium we saw stable revenues and a
strong EBIT margin performance, driven
by pricing leadership allowing us to pass on
the majority of our production cost
increases to our customers, and customer
gains in the energy and medical segments.
The increase in recycling rate and the cost
reductions related to the Renewi 2.0
programme contributed as well. As
anticipated, volumes in Belgium declined as
we chose not to compete at the lower end of
the market for business that brought little or
no benefit to the bottom line, which has
increased the mix. Finally, the strong results
were supported by some one-off, non-
recurring items.
Operational highlights in Belgium during the
year included significant progress made on
the construction and commissioning of the
Ghent facility that will allow our customers
to fulfil the requirements of the VLAREMA 8
legislation. Construction has also started at
our second plant in Puurs.
Commercial Waste NL,
Amsterdam
Renewi plcAnnual Report and Accounts 2023 77
VLAREMA 8: improving recycling outcomes
There have been increments of divergent
legislation of governments globally,
and these are a step in the right direction
on the journey to create a circular
economy, but VLAREMA 8 is
transformative. Not only will it
revolutionise the circularity of the
Belgian economy, but for Renewi it is
already transforming and strengthening
our market-leading position.
Today, companies and organisations in
Flanders produce more than 1mT of
industrial waste – about 50% raw
materials that can be recycled with
improved source sorting. Flanders would
like a 35% reduction of residual waste by
2030, and VLAREMA 8, the Flemish
regulation concerning the sustainable
management of material cycles and
waste materials, is the legislation
making this happen.
Since 1 January 2023, VLAREMA 8 has
stipulated that companies must sort
their waste into 24 separate streams –
the responsibility of checking the sorting
work of its customers lies with the
waste collector.
Transforming our waste sorting
In the approach to VLAREMA 8
implementation, Renewi is investing
over €60m in multiple advanced sorting
facilities. The programme in Ghent has
already begun, and is in the process
of being rolled out in Puurs and,
later, Limburg.
The Ghent facility has a capacity of
125,000 tonnes and is capable of
recycling 50% more materials and giving
value to an additional 60,000 tonnes of
industrial waste. This investment into
advanced sorting will go beyond
complying with VLAREMA 8 – it will play
Renewi fully welcomes
and supports the
ambition of the Flemish
government. VLAREMA 8
creates clear regulations
that stimulate recycling
Dieter Avonds, Strategic Program
Director, Renewi
a pioneering role in improving our
recycling rate, supporting our goal to
reach a 75% recycling rate. It will help
our customers achieve their own
sustainability targets as well as avoiding
the payment of higher taxes for waste
that would otherwise go to incineration.
This has resulted in new commercial
contracts in a competitive market, and a
higher mass balance margin, all
contributing to our circularity.
The transformation of these three sites
has been termed the RACE (Renewi’s
Advanced Circular Economy) Programme
and, when fully operational, has been
estimated to increase recycling from
18.8% to 56.9%. Because of the increased
recycling rate, average waste disposal
should reduce and, due to our market
offering, volumes should increase.
We have also equipped an initial 80
trucks in Belgium with cameras using
artificial intelligence to allow the
identification of non-compliant waste at
source. During the course of the year, a
total of 200 trucks will be equipped with
these cameras.
Strategic reportGovernance reportFinancial statementsOther information 78
O P E R A T I N G R E V I E W
Mineralz & Water
The Mineralz & Water (M&W) Division includes our
soil and water treatment activities at ATM, and the
Mineralz business, with a total of seven sites in the
Netherlands and Belgium.
Division information
Operating sites:
7
Volume of materials
recycled:
1.4mT
(FY22: 1.8mT)
Employees:
335
Revenue:
Underlying EBIT:
Theo Olijve, MD
€191m
(FY22: €194m)
€0.5m
(FY22: €5.8m)
M&W plays an essential role in the
circular economy by processing
significant volumes of highly
contaminated soils, old road surfaces,
industrial waters, sludges, chemical
waste, incinerator residues and packed
hazardous waste.
These waste streams are decontaminated
through separation processes and
biological, thermal extractive and pyrolysis
treatments to make secondary materials
available for the building and construction
industries. Often the solutions are in a
closed loop, such as gravel being put back
into new tarmac.
Our ATM site holds a pre-eminent position
because of its unique combination of
technologies, the cost advantages provided
by its integrated plant processes and its
waterside location for ship-cleaning. It
operates 24/7 and according to the extensive
set of environmental controls and permits
required in the hazardous waste processing
market. In addition, we have Maasvlakte,
near Rotterdam, another unique site and the
only landfill location in the Netherlands
capable of the immobilisation of leaching
hazardous waste and the disposal of
naturally occurring radioactive materials.
SUSTAINABILITY HIGHLIGHTS
M&W processed 1.9mT of waste in FY23 (FY22:
2.3mT). The Division has a blended recycling
rate of 73.8% (FY22: 80.4%) and, within this,
ATM has an exceptionally high recycling rate
of 93.7% (FY22: 94.6%). It is expected to
increase with soil processing volumes, as soil
recycling rates are very high, at circa 98%.
The principal purpose of this Division is the
decontamination of materials that would
otherwise cause pollution, and their
recycling, which contributes to the
preservation of virgin materials. The Division
has comparatively lower carbon avoidance
compared to other Divisions, at 0.67mT
(FY22: 0.71mT). This is due to the lower
carbon cost of production of aggregates
from virgin sources.
As specialist processing sites, M&W facilities
operate to the highest environmental
standards, within multiple permits, and are
proud to meet leading standards,
compliance and regulations. Compliance is
at the heart of the licence to operate. The
Division has exacting standards for the
acceptance of waste, testing of the clean
materials produced and all emissions arising
from operations.
ATM includes a high-tech laboratory, where
around 20 people carry out more than
35,000 tests per annum to ensure ATM not
only complies with technical standards, but
can also develop new capabilities for the
future. The team ensures we meet the
broader tests of our duty of care as a
responsible operator. As Seveso-controlled
sites, our ATM and CFS plants are strictly
regulated and have high safety standards in
compliance with the Seveso guidelines.
MARKETS AND CUSTOMERS
The M&W Division performance was
supported by good performance on the
waterside while making gradual progress on
certification and future outlets for gravel,
sand and filler.
The underlying market driver for inbound
waste to ATM is industrial activity in Europe.
This includes the oil and gas sectors that
mainly operate in Rotterdam and Antwerp,
as well as construction and site remediation
activity across Europe, which drives demand
for inbound and outbound soil materials.
The market for inbound contaminated soil,
particularly internationally, is increasingly
challenging due to slowing of project off-site
remediation and restrictions in permits to
import contaminated soil.
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79
Sorting line
M&W, ATM Moerdijk, gravel
Strategic reportGovernance reportFinancial statementsOther information 80
Operating review – Mineralz & Water CONTINUED
Secondary material, M&W, FORZ®Filler,
made from tar and polluted soil
I would highly
recommend ATM. We
receive an exceptionally
good service for our
input from the UK.
Response times are very
good, and we are always
kept informed
Mr Hay, Totus Environment Ltd
Following a 2021 report by the Dutch
National Institute for Public Health and the
Environment (RIVM), which revealed current
legislation on environmental standards for
secondary mineral products, including
thermally cleaned soil (TGG), and bottom
ashes from incinerators, was ineffective, new
legislation is being developed that will
restrict the application of TGG for
infrastructural projects.
We have responded by transitioning ATM’s
focus to the offtake of sand from
infrastructural projects for concrete
applications. The secondary materials
produced (sand, gravel and filler) will
become the primary products for ATM,
which will lead to higher-value products.
Investments are under way to upgrade the
quality of sand and filler to match market
requirements relating to particle size
distribution and consistency of product
quality, and additional silo capacity has
been added to store the fine and coarse
fraction of the sand, which is suitable for
self-compacting concrete or can be milled to
be used as filler for concrete applications.
Mineralz & Water financial performance
Revenue
Underlying EBIT
Underlying EBIT margin
Operating profit
Return on operating assets
FY23
€m
190.9
0.5
0.3%
1.0
0.8%
FY22
€m
193.9
5.8
3.0%
8.7
11.3%
Variance
%
-2%
-91%
–
-89%
–
The return on operating assets excludes all landfill related provisions. The underlying figures above are reconciled to
statutory measures in notes 2 and 8.3 in the consolidated financial statements.
Regulatory bodies have approved the
application of these secondary materials in
certain concrete applications, so certifying
gravel, sand and filler, ideally to end-of-waste
status, and then producing at scale is the
core focus of market development for M&W.
We continue to see strong customer demand
for secondary materials with Martens Beton,
Excluton, and Heijmans. ATM’s materials can
help these customers meet their ESG and
secondary content targets relating to
government policy.
STRATEGY EXECUTION
The M&W Division strategy is focused on
restoring ATM to full production, expanding
activities in water treatment and creating an
integrated portfolio of secondary building
materials. Read more about M&W as a value
driver on page 48.
Core to FY23 and beyond is the already-
mentioned transition towards the
production of gravel, sand and filler.
This has involved three new product lines
under our FORZ® brand (read more in our
case study above) and the phasing out of
extractive soil activities.
Renewi plcAnnual Report and Accounts 2023 81
FORZ®: building a circular economy
FORZ® is a pioneering circular product line that
produces secondary building materials for road
construction, large-scale soil applications and
the concrete and asphalt industry. In FY23 it has
expanded to produce circular sand, gravel and
filler, offering more customers the chance to
make a significant contribution to the circular
economy and reduce their carbon footprint.
The circular building materials reduce the
environmental impact and support the
companies to achieve their sustainability
objectives.
The FORZ® factory is the first to convert bottom
ashes from waste-to-energy plants into
sustainable, clean and safe mineral secondary
building materials. The fly-ash from coal fired
power stations that has been used as filler for
concrete in the past can be replaced by
FORZ®Filler, which is a good, sustainable
replacement for fly-ash. So, the outlook for ATM’s
secondary building materials is quite promising.
FORZ® meets all quality standards and legal
guidelines. The secondary building materials
often deliver cost savings too.
FORZ® materials can be separated into three
product types, each of which is an
environmentally conscious replacement for the
primary raw material version:
• FORZ®Sand-T
• FORZ®Gravel
• FORZ®Filler
The materials have two main uses.
FORZ® for concrete industry
The secondary building materials produced can
be used as aggregates in concrete and asphalt
and therefore virgin materials are not used. This
has great environmental benefits and a low
environmental cost.
FORZ® for infrastructure
The secondary building materials produced can
be used for land elevation and in infrastructure
projects such as roads and noise barriers.
The objective is to obtain the end-of-waste
status for FORZ®Sand-T and FORZ®Filler
respectively by FY24 and FY25. FORZ®Gravel
is already certified and received the
end-of-waste status.
Investments are being made in processing,
storage and certification of these products in
order to build our capability to serve the
higher-value building materials market,
which will continue to be a key focus of the
Division until the soil cleaning kiln is back to
100% of processing capacity. For Metalz, we
have invested in a new XRF installation to
further upcycle NF fraction, increase margin
and grow new business.
We continue to collaborate with our
customers to grow this Division, for example
creating a new technology called foam
fracturing that removes per- and
Renewi doesn’t just use
‘waste no more’ in their
logo – they actively
contribute to a cleaner
world in an extremely
responsible way
Mr Vreenegoor, BPM products
Polyfluoroalkyl substances (PFAS) in
wastewater streams.
Our expertise also leaves us optimistic for
future opportunities regarding treatment of
Dutch Substances of Very High Concern (ZZS).
FINANCIAL PERFORMANCE
The Mineralz & Water Division saw revenues
decrease by 2% to €190.9m and underlying
EBIT decreased by €5.3m to €0.5m. The EBIT
drop is largely due to the increase in
disposal cost accruals for historic
production of TGG.
Within the division we saw a strong
performance on the waterside, albeit
impacted by a one-off incident which
incurred additional operational costs and a
reduced throughput in the final quarter. We
have adjusted our processes to reduce the
likelihood of a recurrence. We continue to
see customer wins on the waterside as we
benefit from our unique capabilities and
position in this segment.
We continue to work with off takers to place
our 0.6mT residual TGG stocks albeit at a
higher cost than previously expected and
anticipate clearing the remaining stock
over the next two years. Over 100kT is
under contract for shipment in FY24 and
an additional 300kT is under negotiation.
We continue to develop and certify our
aggregate products to provide high quality
products for the construction industry with
a lower carbon footprint than virgin
materials. We now use the raw material
which was previously used to produce
TGG, to produce aggregates for the
building industry. Our first product in this
range – gravel – has already received
certification and is proving to be popular
with customers in the construction
industry who are attracted to its
credentials as being part of the circular
economy. We continue to develop two
more products – sand and filler – and aim
to bring these to a level where they can be
sold in large volume and replace their
virgin alternatives during the current
financial year. This has involved some
investment in machinery that can produce
sand and filler to the required particle size
specifications. Once completed, we will
start to ramp up production in the second
half of the year.
Strategic reportGovernance reportFinancial statementsOther information
82
O P E R A T I N G R E V I E W
Specialities
The Specialities Division comprises three businesses:
Coolrec, which recycles household appliances, Maltha,
a specialist glass recycling business and our UK Municipal
public private partnership (PPP) operating contracts.
Division information
Operating sites:
49
Volume of materials
recycled:
1.6mT
(FY22: 1.5mT)
Employees:
912
Revenue:
Underlying EBIT:
€349m
(FY22: €350m)
€17.1m
(FY22: €4.1m)
James Priestley, MD
The Specialities Division operates in
Belgium, the Netherlands, the UK, France
and Portugal.
Coolrec is a strong player in the recycling of
fridges, freezers and other small domestic
appliances (SDA) with sites in the
Netherlands, Belgium and France. From the
recycling of fridges and SDA materials,
Coolrec is able to sort waste streams into
high-quality recycled plastic streams and
both ferrous and non-ferrous recycled metal
streams. Inbound supply comes from
collection schemes on mostly long-term
supply contracts, and outbound products
provide industry partners with high-quality
secondary materials to make closed-loop
circular products. One of our most
prominent customer wins in FY23 has been
the plastics used in Playmobil’s award-
winning toy range – Wiltopia. Read more
about this partnership on page 85.
Maltha, a European leader in glass
recycling, has sites in the Netherlands,
Belgium, France and Portugal. It focuses
primarily on recycling flat and container
glass into cullet and glass powder for
re-use in the glass industry. O-I, a world
leader in packaging glass, owns 33% of the
Maltha group.
UK Municipal operates waste treatment
facilities for UK councils, typically under
long-term PPP contracts and with a
significant residual waste component.
SUSTAINABILITY HIGHLIGHTS
Overall, we have improved our recycling
rates in FY23. The Specialities Division
processes 2.3mT of waste per year, 39%
within the UK Municipal contracts, 56% in
Maltha and 5% in Coolrec. We are focused
on improving recycling rates and delivering
excellent customer service across our
Municipal contracts. The outlook is
determined by the government’s waste
strategy. We are looking for opportunities to
grow in the UK but along with rest of the
industry, we continue to wait for clarity from
the UK government over its proposed waste
reforms. The Renewi Municipal recycling rate
is 31.4%. Most of the input is ‘black bag’
waste, which is what is left over after other
streams have been separated for recycling.
At the outset, the contracts were established
to facilitate diversion from landfill and to
boost recycling and recovery rates, which
vary across the contracts. The overall rate is
90% for the whole of municipal, but at ELWA
it is more than 99%, with only asbestos sent
to landfill. By contrast, Maltha and Coolrec
deal with source segregated feeds
(monostreams), and so deliver exceptionally
high recycling rates and quality secondary
products. This results in a divisional
recycling rate of 70.6% (FY22: 63.4%).
Our carbon avoidance contributions come
from the recovery of usable materials and
the fuels generated by these processes,
which collectively produce a positive CO2
avoidance of 0.80mT (FY22: 0.79mT).
MARKETS AND CUSTOMERS
We have seen continued growth and
investment for both Maltha and Coolrec, in
line with our business strategy. The Coolrec
team has extensive knowledge of best-in-
class sorting technologies and the Division
is a recognised supplier of high-quality
recycled plastics and metals. Our
partnership with Playmobil has been
recognised by a number of high-profile
awards and we have other, similar
opportunities in the pipeline. Maltha is
benefiting from increased demand for glass
cullets driven by circular benefits as well as
the high energy prices.
Renewi is well positioned to respond to the
UK’s proposed wide-ranging waste policy
reforms, including its goal to halve the
amount of waste going into landfill and
Renewi plcAnnual Report and Accounts 2023
83
Secondary material
Maltha, perfume bottles recycled at Lommel,
returned straight back to the glass industry
Strategic reportGovernance reportFinancial statementsOther information 84
Operating review – Specialities CONTINUED
incineration in England by 2035 and
increase the level of waste sent for recycling
to 65%. We are cautiously following the UK
markets while awaiting clarity in the
government’s waste strategy to scope out
the possibility of UK expansion.
STRATEGY EXECUTION
Safety has been our prime focus this year.
We know we need to improve our safety
culture and we have placed a strong
emphasis on improving our safety
leadership, alongside new initiatives to
improve risk awareness across the division.
We continue to see an increased demand for
higher quality recycled material streams,
which supports our strategy. We are
investing and improving to invest in
improving quality products and also our
focus on getting the related sourcing
material, while continually improving quality
to fulfil the demand from customers. We are
also expanding our activities by entering
Specialities financial performance
Revenue
Underlying EBIT
Underlying EBIT margin
Operating profit
Return on operating assets
FY23
€m
348.6
17.1
4.9%
(3.0)
35.4%
FY22
€m
350.1
4.1
1.2%
3.2
28.9%
Variance
%
0%
>100%
–
-194%
–
Underlying EBIT includes utilisation of €14.2m (2022: €7.0m) from onerous contract provisions. The return on
operating assets excludes the UK Municipal business. The underlying figures above are reconciled to statutory
measures in notes 2 and 8.3 in the consolidated financial statements.
into new market segments. Therefore, for
Coolrec and Maltha, we are actively looking
to expand at pace through investments.
Maltha’s performance has improved under
new management which has led to
increased investment.
The core focus for Municipal is on continuing
to improve the operating performance of the
remaining assets to reduce cash losses and
create a platform for future growth.
FINANCIAL PERFORMANCE
The Specialities Division saw flat revenue at
€348.6m and underlying EBIT was up
significantly at €17.1m (FY22: €4.1m). Within
the division Coolrec and Maltha achieved
20% growth and both are delivering EBIT
margins close to 10%.
From an operational perspective we were
delighted to have signed the contract with
Playmobil which demonstrates that we have
the capability to produce recyclates that are
of the highest standards – both in terms of
their quality and consistency. We expect that
Renewi plcAnnual Report and Accounts 2023 85
Collaborating with Playmobil
to create award-winning toys
Coolrec has been collaborating with
Playmobil, a business unit of Horst
Brandstätter, to produce toy-level quality
plastics for their Wiltopia range, which is
made from over 80% sustainable
materials (recycled and bio-based
materials). As a result of strong
collaboration and intense R&D
processes, where we have focused on
improving the purity and quality of our
outlet plastics. We have been able to
create a compound which reaches the
high-quality requirements for toy safety,
not only in Europe but worldwide.
This process has led to 11 of our plastic
outlet products reaching end-of-waste
status: where a material ceases to be
classified as waste, but as a recovered
material instead. This validates our
status in the waste-to-product sphere.
Customers and compliance schemes in
the WEEE market have acknowledged
this landmark achievement – we have
been awarded the Golden Circle Award
from the Dutch Province Noord-
Brabant, which proves Coolrec’s major
contribution to the circular economy.
How the process works
Plastics from refrigerators are sorted,
granulated and compounded before
being sent to Playmobil. To be allowed
to deliver these products to companies
like Playmobil, strong quality control
processes have been set up in our
laboratory. This way we can constantly
meet the high-quality standards of the
toy business, which are among the
highest in the manufacturing industry.
Educating the community
Together with Coolrec, Playmobil
developed an animation to explain and
educate its young consumers – the next
generation – about the vital need for
recycling and use of recycled plastics.
Awards and reception
In 2022, Wiltopia was awarded several
Toy of the Year Awards. The range has
not only been very well received by the
industry but also by Playmobil’s
consumers. It was the most successful
new launch in the Sustainable Toys
2022 sector in Germany, France, Spain,
Italy, Belgium and the Netherlands.
Close up optical
sorting line,
Maltha,
Heijningen
an increasing number of manufacturers in
a variety of sectors will turn to recyclates
to reduce the carbon footprint of their
production. We also recently won an
award for a fully closed loop solution with
Electrolux where inner liners for new
fridges are made with >70% recycled fridge
plastics from Coolrec.
Our UK Municipal performance was stable
as we continue to manage contract costs
closely and have a team who are focused
on using innovation and prudent cost
management to ensure that the risks are
managed carefully. However, based on the
inflationary outlook in the UK our
assumptions on both lifecycle spend and
cost inflation, combined with lower
volumes at ELWA, have necessitated a
€27.1m increase to the associated onerous
contract provisions. In addition, an
amendment to an accounting standard
resulted in an increase of €52m to the
opening onerous contract provisions
which has no impact on cash and no
change in the underlying performance of
the contracts.
Strategic reportGovernance reportFinancial statementsOther information 86
Risk
management
Our risk management and internal control frameworks are key to the execution
of our strategy. The overall responsibility for risk management resides with our
Board, however the Executive Committee, our operating divisions and all our
employees play a vital role in the daily management of risk.
INTEGRATED RISK MANAGEMENT
We operate in a rapidly changing
environment and face specific industry,
commercial, regulatory and other risks.
While some remain beyond our control, the
Board and Executive Committee continually
assess risk, prioritising their responsibility to
anticipate potential threats to our
operations, customers, employees and the
execution of our strategy.
Renewi has put in place various risk and
mitigation strategies that form the basis for
divisional risk assessments and
management. Our group risk management
strategy and policy is essential for:
• delivering our objectives;
• maintaining sustainable shareholder value;
• protecting our reputation;
• promoting ethical conduct; and
• good governance.
We have made significant progress in the
automation of our risk processes and
incorporated the risk register review and
post-investment review meetings into the
monthly business review process. This has
further embedded risk management into
the business which has resulted in there
being no need for a separate risk committee.
Our latest risk assessment concluded that
the most significant risks to Renewi are
changes in laws and policy as well as
the risks for Health & Safety. The high
inflationary environment has led
to an increasing risk for residue costs
with risks around volumes and demand
remaining high.
In line with last year the labour market is still
challenging which results in a high risk for
labour availability.
There were a number of disruptive events in
FY22, whereas in FY23 the risk profile has
reduced due to today’s situation being more
stable. The implementation of mitigating
actions has resulted in a decreasing risk
profile for talent development, leadership
and diversity, regulatory compliance and
cyber risks.
RISK APPETITE
At Renewi, we take a proactive approach
to managing risk. Our risk appetite is
regularly assessed against the following
impact dimensions:
• Health and safety
• Environment
• Development and acquisition
• Business continuity
• Investors and shareholders
• Financial
• Reputational and media
• Control environment
Our focus on risks relating to health and
safety, the environment and regulation is
unwavering and we have dedicated
significant resources to these areas. The
Executive Committee and senior
management continuously monitor these
risks to ensure they align with our low-risk
appetite. Other dimensions and risks are
reviewed on an ongoing basis. We have
implemented a new risk management tool
that improves our risk monitoring efficiency
and our ability to assess current risk against
our risk appetite. This makes it easier for us
to stay informed of potential challenges and
make informed decisions.
RISK MANAGEMENT FRAMEWORK
Effective risk management is fundamental to
our strategy, and our comprehensive
framework enables us to evaluate and address
risks in a structured, cost-effective manner.
The framework notes Renewi’s strict
adherence to it and includes the schedule of
matters reserved for the Board, which
ensures that all significant issues are
appropriately managed by the Directors.
Our risk management framework
ensures:
• there is an appropriate risk culture,
which ensures risks are recognised,
identified quickly and effectively
managed;
• risks are identified and their
importance evaluated; and
• effective mitigating actions are
designed, implemented and
monitored.
The output of this process is a summary
of all significant strategic, operational,
financial and compliance-related risks,
our current mitigating controls and action
plans necessary to reduce risks within our
risk appetite.
The divisional management teams are
responsible for the execution of the risk
management activities within the
divisions. Risk registers are reviewed by
the divisional management teams and
are discussed at the monthly business
review meetings. This ensures key risks
are monitored and mitigated
appropriately and support our risk-
management and decision-making
processes. Renewi’s risk registers and
mitigation plans are reviewed by
Executive Committee and the Board.
Enhanced risk assessments take place for
major capital requests and are reviewed
by the Investment Committee.
Day-to-day operations are supported by
risk management systems (which include
divisional risk registers), and risk
management is embedded in project
management activities, which include the
change management approval process.
Renewi plcAnnual Report and Accounts 2023 87
Our risk management framework
TOP-DOWN
STRATEGIC RISK MANAGEMENT
OUR RISK MANAGEMENT
FRAMEWORK
BOTTOM-UP
ENTERPRISE RISK MANAGEMENT
Approval and oversight of
strategic objectives and actions
Put in place an appropriate policy
for the management of risk that is
adequately resourced
Establish the risk appetite of the
Group and review periodically
Assess key strategic risks
BOARD
Delivery of strategic actions
in line with risk appetite
Identify and manage
key strategic risks
Monitor key risk developments
Drive a culture of risk awareness
EXECUTIVE
COMMITTEE
Assess the effectiveness of
risk management
Ensure that risk in excess of the risk
appetite is insured effectively
Oversight to ensure that the
processes for management of risk
are effective, efficient and robust
(delegated to the Audit Committee)
Consider completeness of key
strategic risks
Consider adequacy of mitigations in
line with risk appetite
Consider aggregation of risk
exposures across the Divisions
Submit summary risk reports for the
Audit Committee and the Board
Ensure that the Board-approved
Group risk management framework
is implemented and effective
Support the Renewi risk culture
through risk systems, sharing of
learnings and best practices, and
review of risk failures
Provide access to expertise in
managing risks, from across Renewi
or from outside specialists
Owners of the risks are responsible
for delivering mitigating actions in
line with the risk appetite
and within a strong risk culture
Promote an appropriate risk
culture across Renewi in which
an appropriate awareness and
management of risk in all its forms
is considered by management in
their daily activities
GROUP RISK
MANAGEMENT
Review selected risks from risk
registers, assess adherence
to the risk appetite and the
mitigations in place
Drive consistency in approach,
use of tools and risk appetite
across Renewi
BUSINESS
AREAS/
DIVISIONS
Periodic and ongoing assessments
of risks and risk trends
Reporting risk registers that include the key
strategic risks for each Division, mitigating
actions in place, current risk score,
design and execution of future mitigation
approaches and consider the effects of such
actions to the risks and risk profile
Review occurrences of risk management
failure to identify root cause, and identify
and share lessons learned to mitigate
risk of repetition
Strategic reportGovernance reportFinancial statementsOther information 88
Risk management CONTINUED
Optical sorting line, Maltha,
Heijningen
REVIEW OF THE RISK
ENVIRONMENT DURING FY23
We have reviewed and assessed our risk
detection and mitigation processes. The
main risk events of FY23 are outlined below.
Safety
Fire remains our main operational risk due
to the possibility of spontaneous
combustion in certain waste streams, and
particularly the risk posed by flammable
lithium-ion batteries found in ordinary waste
streams. Renewi’s reputation for fire safety is
good and continually improving with
investments in fire detection and prevention
technology, team training and fire safety
audits, alongside emergency preparedness
audits, across all sites. This has resulted in a
significant reduction in major fires as set out
on page 71.
We have focused on building a strong
safety culture this year, resulting in a
good safety performance. We have seen
a reduction in LTIs, major fires and
environmental concerns.
Tragically, there was one fatal incident at a
Renewi site. In response, our traffic safety
plan has been tightened.
Next year, safety will remain a key focus,
supported by a new business-wide audit
programme that includes SHEQ.
Residue cost and capacity
High inflation has resulted in elevated costs
of disposals, increased waste taxes and
reduced landfill options. This, coupled with
the unexpected invasion of Ukraine, caused
a volatile energy supply and high energy
prices, plus high costs and interest rates. We
have strategies in place to minimise impact,
including diesel hedging, dynamic pricing
and monitoring of available energy.
Input volume has dropped due to the
geopolitical situation, which may raise the
risk of a failure to meet or pay contract
commitments at certain incinerators.
Labour availability
The risks around labour availability and cost
are still high due to general economic
conditions and macroeconomics. The
challenging nature of the work can also
make it difficult to recruit.
Due to a strong employer brand, we have
been able to fill most vacancies. This can
be evidenced by a small decrease of this
risk, but the risk remains high.
Changes in industry-relevant
laws and policy
We see sustained pressure on lawmakers
and policymakers for new laws and
policies, and on regulatory bodies to
enforce existing laws and policies.
Maintaining good dialogue with governing
bodies remains crucially important.
Potentially adverse changes are planned
for and managed.
Cyber
Increased activity of malicious actors in the
cyber domain means there is increased risk
of falling victim to a cyber attack. We have
Renewi plcAnnual Report and Accounts 2023 89
Reporting through our Audit Committee and
Executive Committee ensures the
identification and communication of critical
risks and ensures they are brought to the
attention of the Board, and its decisions and
risk appetite are cascaded throughout our
risk architecture. This means our approach
to managing risk is consistent and aligned
across Renewi, and that the risk
management framework is implemented
and effective. With these procedures in
place, risk management is deeply
embedded in our business and we are
promoting a risk-aware culture in everything
we do.
been subject to attempted attacks in the last
year and expect this trend to continue.
To improve our protection against potential
threats, we have upgraded our systems and
24/7 monitoring is in place with the Security
Operation Centre. We have also conducted
awareness campaigns and training for our
employees about risks in the digital
environment to ensure consequences of
successful attempts are reduced.
Climate
The impact of climate change is factored
into our risk management processes.
The short-term climate risks on the Risk
Radar are:
• increased pricing of GHG emissions;
• extreme heat; and
• water stress and drought.
GROUP RISK MANAGEMENT
DEPARTMENT
Our Group Risk Management
department ensures the Board’s
decisions and risk appetite is cascaded
throughout Renewi. It promotes a
risk-aware culture and ensures the
risk management framework is
implemented and remains effective.
The department provides expertise in
managing risks, either from within
Renewi or from outside specialists.
Ultimately the operating divisions
and business unit management are
responsible for managing risks. They
are supported by the Group risk
department with the latest information,
risk failures, best practices, policies,
strategies and processes.
Climate risks
Increasing cost of GHG emissions
The rising cost of carbon through carbon
pricing schemes can be a risk to Renewi’s
own operations, as the expansion of the
scope of both EU and UK Emission
Trading System (ETS) and as well the
Dutch, French and Portuguese carbon tax
will mean we are subject to the scheme. It
is possible that if Renewi does not invest
in green technology or efficiency
upgrades, we could eventually incur high
carbon costs. Increasing carbon-intense
waste treatment processes would worsen
our carbon footprint, while the resulting
avoided emissions may not be attributed
to it under carbon pricing mechanisms.
While assessing how to consider and apply
carbon prices in our decisions, we are
building our carbon emission reduction
plan as well as considering advanced
technologies for carbon capture (example
of the DIMMER project being investigated).
Extreme heat
This risk is connected to the fire risk:
extreme heat brings a higher chance of fire
due to spontaneous combustion of waste.
Extreme heat can also cause difficult
working conditions for our employees,
with the possibility of heat-related illness
such as heat stroke.
Mitigating actions are already in place with
fire detection systems at most sites, which
has resulted in fewer major fires, and
procedures for controlling temperatures
are implemented at some sites.
Our emergency response and contingency
plans ensure business continuity.
Water stress and drought
This is a developing risk which will impact
Renewi in two ways:
• Lowering our operational capabilities: if
there is insufficient water, some plants
may have to halt operations or start
developing alternative solutions to
obtain water (with increased operating
costs and/or on-site transformation
requiring further capital investment)
• Lowering river levels: this impacts our
use of waterways to move inbound and
outbound volumes of waste. For some
sites, if the river levels are low, ships
and barges may have difficulties to
reach the dock (barge shipments are
mainly used for transporting glass
and wood)
Risk assessment
For climate-related risks, we have worked
alongside a leading global sustainability
consultancy to identify relevant risks and
assess the materiality of these issues. To
better understand potential timing and
future materiality of key climate-related
risks, we completed in FY22 a qualitative
scenario analysis assessment. We have
employed globally recognised datasets
which provide insight into the possible
risk and/or opportunity trends associated
with low- and high-carbon futures. We
will update our qualitative scenario
analyses assessment every two years and
take into account latest developed and
made publicly available climate models.
We have started working on a financial
quantification exercise for two specific
climate risks during the year which will
determine the priority sites to be looked
at that require immediate focus and
a mitigation plan will be prepared
during FY24.
We follow the guidelines set by the
Financial Stability Board. More details can
be found in the Task Force on Climate-
related Financial Disclosures on pages 59
to 65. As the risks are better quantified
this year, we have made them part of the
Risk universe diagram on the next page.
Strategic reportGovernance reportFinancial statementsOther information 90
Risk management CONTINUED
Objectives of our risk management framework
2
KNOW WHAT
RISK WE WANT
TO ACCEPT
Manage a risk strategy
in which the tolerance
and appetite of the
Group for differing
levels and types of risk
is clearly understood.
3
4
5
MANAGE OR
MITIGATE OUR
RISKS
Ensure that all
identified key risks
are effectively mitigated
or, where appropriate,
transfer risks
through insurance.
TRAIN OUR
PEOPLE IN RISK
MANAGEMENT
Ensure that
management is
trained in the effective
identification,
assessment and
management of risk.
CONTROL
SYSTEMIC
RISK
Maintain and improve
a system of internal
controls to manage risks in
decision-making, contract
management and financial
transactions.
1
KNOW WHAT
RISKS WE
FACE
Identify and evaluate
our universe of potential
risks to allow the creation
and management of
registers of risks faced by
the Group.
Risk universe
Non-climate risks
Climate risks – physical risks
Climate risks – transition risks
Size denotes current impact score
1 2 3 4 5
s
k
y ri s
g
People risks Market and o
p
er
a
tio
n
a
l r
i
s
k
s
7
15
12
5
6
9
8
1
14
ce risks Tech n olo
10
11
13
2
3
2
4
3
1
4
1
2
4
3
al
g
n
cial, le
plia
m
o
c
d
n
a
n
a
n
i
F
C
l
i
m
a
t
e
r
i
s
k
s
Less likely
Most likely
Less likely
Renewi plcAnnual Report and Accounts 2023
91
Summary of key risks
NON-CLIMATE RISKS
1. Product pricing, demand and quality
2. Residue costs, capacity and specification
3. Input volumes
4. Changes in law and policy
5. Disruptive event
6. Health and safety
7. Digitisation
8. Labour availability and cost
9. Major plant failure or fire
10. Unsustainable debt
11. Regulatory compliance
12. Talent development, leadership and diversity
13. Long-term contracts
14. Input pricing
15. ICT failure and cyber threat
CLIMATE RISKS
Physical risks
1. Extreme heat
2. Water stress & drought
3. Flooding
4. Storms & wind
Transition risks
1. GHG pricing
2. Supply chain transparency
3. Lack of developing climate policies
4. Volume/composition due to reduce/re-use
Risk trend
Inherent
risk
profile
Current
risk
profile
Current risk impact scores
Previous year scores
Likelihood
Impact
Likelihood
Impact
—
↑
—
—
↓
—
—
↓
—
—
↓
↓
—
—
↓
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
l
4
4
4
5
3
3
3
4
3
2
3
3
3
3
3
3
4
3
3
4
4
3
4
3
3
4
2
3
3
3
4
3
4
5
5
3
3
5
3
2
4
3
3
3
4
3
3
3
3
3
4
3
4
3
3
4
3
3
3
4
Risk trend
Future
risk score
Time
horizon
Current risk impact scores
Previous year scores
Likelihood
Impact
Likelihood
Impact
—
—
—
—
—
—
—
—
l
l
l
l
l
l
l
l
To 2025
2025 - 2030
2025 - 2050
2025 - 2030
To 2025
2025 - 2030
2025 - 2030
2025 - 2030
4
3
3
3
5
4
2
3
4
3
3
2
4
3
4
2
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Key
—
Unchanged risks
↑
Increased risks
↓
Decreased risks
l
Low risk
l
Medium risk
l
High risk
Strategic reportGovernance reportFinancial statementsOther information 92
Risk management CONTINUED
Summary of key risks
Reference numbers are consistent with those used in the summary of key risks table.
KEY RISK
KEY MITIGATION
COMMENTARY
1. Product pricing, demand and quality
That the value we receive for recycled
product falls, that markets contract,
reducing demand for our product, or we
become unable to produce to the
required quality.
Risk direction
Strategic objectives
1
2
4
• By focusing on improving product quality, we
optimise the value we receive for our products
• Partnerships, innovation and investments in
cutting-edge technology that fit with market
needs for products
• Sustainable technologies that are used to align
with market needs and international and
national policy
• We apply dynamic pricing that links input and
output prices. This leads to more stable margins
• Renegotiation of long-term and fixed-price
offtake contracts where appropriate
• We thoroughly understand and closely monitor
the capacity-driven markets to mitigate risk and
leverage opportunities that are presented
• We use multiple product offtakers to spread the
risk where appropriate
This year prices for paper, plastics and metals
have seen record highs before normalising in the
second half of the year.
The expectation for FY24 is that prices will remain
around normalised levels but could fall further.
As we have good mitigating measures in place the
impact will be limited but due to volatility
(especially in paper and metals) and its
importance to our margins the risk remains high.
2. Residue costs, capacity and specification
Lack of capacity at outlets and/or
inability to produce in specification,
resulting in increased price or
limitations of disposal of burnable waste
and other residues.
Risk direction
Strategic objectives
1
5
• We have experienced employees dedicated to
burnable and residual waste offtake markets
• A range of residue offtakers contracted to
spread the risk. Contract end dates are carefully
managed to avoid having to renew contracts
simultaneously, further reducing the risks
• Quality control systems are in place to ensure
specification of residues is at the required level
• Offtake strategy designed, implemented and
continuously improved
Taxation on importing waste reduces the input
volumes (also see risk 14). The continuing
pressure on recycling and our investments in
cutting-edge recycling technologies lead to
reduced residue volumes and overcapacity at
outlets. Improved output streams at ATM further
reduces this risk.
The calorific value of residues remains a focus
for incinerators.
Input volume drops due the geopolitical situation
in Ukraine and potential economic downturn,
which may raise the risk of a failure to meet or pay
contract commitments at certain incinerators.
3. Input volumes
That incoming waste volumes in the
market may fall.
Risk direction
Strategic objectives
1
3
4
5
• Effective reporting of incoming waste volumes
across the Group for rapid response to market
changes
• Rapid response to cut costs if input volumes fall
• Continued investment to secure new waste
streams and volumes
• Increase sales activities on focused profitable
markets and segments
• Market-facing, customer-focused organisation
The likelihood of a lack of input volumes
remains stable but high, due to potential
economic downturn and the geopolitical
situation in Ukraine.
Public opinion continues to shift towards
increased recycling rather than incineration,
which is favourable for Renewi given our assets
and partnerships.
RISK DIRECTION KEY:
Increase
Stable
Decrease
Renewi plcAnnual Report and Accounts 2023
93
KEY RISK
KEY MITIGATION
COMMENTARY
4. Changes in law and policy
Adverse impacts from changes in law
and policy, including environmental, tax
and similar legal and policy regimes,
including changes in regulatory attitude
and behaviours as a result of shifts in
public opinion.
Risk direction
Strategic objectives
1
6
• Horizon-scanning by competent internal
specialists to ensure changes are planned
for and managed, and potential opportunities
captured
• Alignment of business model with national and
international policy and law towards more
sustainable waste management practices
• Engagement with regulators and legislators to
discuss what is possible in treating waste and to
support tough but achievable sorting and
product quality targets
5. Disruptive event
That a disruptive event such as a
pandemic or war has severe
consequences for our incoming waste
streams, market prices, access to energy
and workforce, causing business
interruption or loss.
Risk direction
Strategic objectives
1
• Crisis protocols and capabilities to handle the
crisis in place with principles that can be
applied to any crisis, whatever the nature
• Business continuity plans in place
• Monitor changes in government and health
adviser within our operating countries
• Escalation and impact scenarios for the
geopolitical situation in Ukraine are in place
• The energy availability/pricing is covered
by overall Renewi contracts with hedging
in place
Our business model is in line with society’s needs
for sustainable waste management.
Changes in law and policy occur frequently
and this is expected to continue. The impact
from the changes is increasingly favourable as
and when enforced.
Most changes in law and policy provide opportunities
for Renewi. The most recent change is the VLAREMA
8 legislation in Belgium, which we believe is an
opportunity for Renewi rather than a risk.
We see sustained pressure on law and
policymakers for new laws and policies, and on
regulatory bodies to enforce existing laws and
policies. Maintaining good dialogue with governing
bodies remains crucially important. Potentially
adverse changes are planned for and managed.
The war in Ukraine is rapidly changing
and consequences, like increased energy,
and diesel prices and general inflation
have materialised.
These risks are offset by our diesel hedge,
targeted price increases and dynamic pricing,
limiting our price risk.
Availability and pricing of energy, both fuels and
electricity, remains a risk due to the ongoing
geopolitical and macroeconomic environment.
Potential escalation scenarios are being
considered and mitigations are being designed
and implemented. For a potential threat of a
new pandemic, there are crisis protocols in
place to identify these at an early stage and
have a structured approach to address the
evolving situation.
STRATEGIC OBJECTIVES
1
4
Leader in recycling
Enable the circular economy
2
5
Leader in secondary material production
Reduce carbon emissions and waste
3
6
Selectively gain market share
Care for people
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94
Risk management CONTINUED
Summary of key risks
Reference numbers are consistent with those used in the summary of key risks table.
KEY RISK
KEY MITIGATION
COMMENTARY
6. Health and safety
Injury or loss of life. That
we incur reputational loss,
or civil and criminal costs.
Risk direction
Strategic objectives
6
7. Digitisation
That a disruptive technology or business
model deployed by a competitor or new
entrant impacts our ability to compete.
Risk direction
Strategic objectives
1
2
4
5
6
• Safety is the top agenda item at all
management meetings
• Safety leadership programme in place
• Resilience training rolled out
• We have made improvements on safety culture
leading to more near miss reporting
• Coherent targets in place for accident, near-miss
and other key safety performance parameters
• Improved Traffic plan on all sites
• Corporate health and safety managers and
competent internal specialists in place
• New nominations for Future Leaders
programme for FY24
• Defined and tracked health and safety priorities
plan under way and delivering
• Home Safe Campaign executed and shift to
Safety is a core value at Renewi. This commitment
has been translated to all levels of the business,
demonstrated by the implementation of ISRS
(International Sustainability Rating System),
Safety Leadership programme, our 10 LSRs,
internal audits and multiple safety campaigns.
This has resulted in an important reduction in
LTIs, major fires and environmental concerns.
Following on from the fatal accident our traffic
safety plan has been tightened.
Safety behaviour still needs to be worked
on as breaches exist. This area remains under
high scrunity.
Further we have seen an important reduction in
LTIs, major fires and environmental concerns.
ISRS and Hearts & Minds
Please refer to the Safety section on page 71.
• We actively and openly engage with regulators
We are working on the main project Renewi 2.0,
which will continue to optimise and digitise our
core processes. The risk scoring for this risk is in
line with last year. We continue to monitor
competitor threats and apply a fast-follower
principle. We run numerous digitisation pilots
within Renewi to establish their viability, value
and disruptive capability.
We remain alert and proactive to changes seen in
the markets around us and those emerging in the
global waste-to-product markets. This is
co-ordinated and supported by the Director
Strategy & Business Development with the
support of the CIO.
• The Chief Information Officer (CIO) together
with the Director Strategy & Business
Development, both members of the Executive
Committee, have the remit to identify future
opportunities and risks
• Active monitoring across the Divisions and
Group of new digital entrants, technology or
services from competitors
• Renewi takes a fast-follow approach to
emerging threats to keep expenditure
proportionate to threat
• Diversification of business, core operational
services and products limits threat and
impact from disruptive business models
and technology
• Renewi’s innovation programme identifies
opportunities ahead of competitive threats and
generates competitive advantage proactively
• Renewi has several digital developments
under investigation to retain a competitive
leading position and mitigate threats
(AI, big data, robotics, online/digital services,
platform services)
• Increased integration across the Group to
align data and increased efficiency through
digital automation
• Partnerships in place, which continue to
increase, and allow for collaboration on
industry innovations with key existing, as
well as new, players in the industry
• Renewi 2.0 transformation programme
RISK DIRECTION KEY:
Increase
Stable
Decrease
Renewi plcAnnual Report and Accounts 2023
95
KEY RISK
KEY MITIGATION
COMMENTARY
8. Labour availability and cost
That there are shortages of certain
labour types, leading to unavailability or
severe wage inflation.
• We offer competitive wages
• Renewi is a strong employer brand
• Successful recruitment programmes for drivers
Risk direction
Strategic objectives
3
6
have continued
• The culture within Renewi is strong and have
the attention of the management.
• Strengthened learning and development
programme including leadership
• More vacancies are solved internally
The risks around labour availability and cost are
still high due to macroeconomic conditions,
combined with a lack of some core skills and an
ageing workforce.
Due to a strong employer brand we have
been able to fulfill most vacancies. This can be
seen in the slight decline this year, but the risk
remains high.
9. Major plant failure or fire
Operational failure and/or fire at a key
facility leading to business interruption
and other costs.
Risk direction
Strategic objectives
3
4
5
6
• Optimise fire prevention plan
• Performance and gap-analysis resulting in
fire detection register with overview of all
different systems
• Train people as a ‘fire intervention team’
• Fire risk survey process in place including
engagement with insurers and with competent
external advisers
• Business continuity planning in place at all
major sites and under review for all sites
• Mechanical breakdown insurance in place for
at-risk facilities and reviewed on a regular basis
for adequacy
• Regular annual and other shutdowns at key
facilities to ensure they remain well invested
and maintained
• Business continuity planning includes
breakdown risk and mitigation measures
This year fire prevention measures have been
implemented by the installation of fire detection
sprinkler systems.
The implementation of fire standards is verified
by fire standards and emergency preparedness
audits.
The implementation of the fire standards and
prevention measures have decreased the number
of major fires this year.
High-quality maintenance and life cycle
programmes are in place in order to ensure
resilience at major unique facilities. Across
our general recycling and recovery plants, our
larger company provides flexibility to divert
waste and retain value internally in the event
of a breakdown.
10. Unsustainable debt
That funding is not available or that
funding sources are available, but that
cash generation is insufficient to allow
access to funding.
Risk direction
Strategic objectives
3
6
• Our financing structures reduce our
The risk of unsustainable debt continues to fall.
We currently have significant covenant and
liquidity headroom on our main Group facility.
We have a balanced maturity profile supported by
the recent new issuances.
financing cost, continuously optimising l
iquidity and headroom
• Capital investment to meet strict return
requirements
• Strong budget control on capital projects
• Good balance of leased and owned assets
• We have a diverse range of financing sources
and maturities
• Supportive and flexible finance partners
• Investment Committee in place to support
Divisions with mergers, acquisitions, partnerships
and investments from an early stage
STRATEGIC OBJECTIVES
1
4
Leader in recycling
Enable the circular economy
2
5
Leader in secondary material production
Reduce carbon emissions and waste
3
6
Selectively gain market share
Care for people
Strategic reportGovernance reportFinancial statementsOther information
96
Risk management CONTINUED
Summary of key risks
Reference numbers are consistent with those used in the summary of key risks table.
KEY RISK
KEY MITIGATION
COMMENTARY
11. Regulatory compliance
That we fail to comply with
environmental permits and/or
environmental laws and regulations.
Risk direction
Strategic objectives
3
5
6
• Effective management of all environmental and
regulatory matters arising through environment
management systems and regular inspections
and audits
Renewi recognises the importance of compliance
with all environmental regulations and takes a
proactive approach to comply with continuously
tightening regulations.
• Monthly environmental issues reporting across
all levels of organisation with prompt follow-up
• Experienced and competent environmental
specialist employees in place
• Community environmental engagement
performance in place as a key business objective
• Compliance rules are often based upon best
available (measurement) capabilities. When the
ability to measure certain substances improves, the
threshold is lowered accordingly. Our operational
grip and continuous improvement processes
ensure we can adapt rapidly to increasingly strict
rules and regulation
As industry leader, Renewi embraces the
tightened regulations as an opportunity to
strengthen relationships with regulators and
showcase transparency. Renewi understands the
importance of being forward-thinking and
collaborative when it comes to regulatory
compliance. Effective mitigations are in place with
our environment and regulatory management
systems, reporting, inspections and audits.
Additionally, this year a compliance director at
group level is appointed and more insight in the
compliance data is available.
12. Talent development, leadership and diversity
That we fail to develop the required
management capabilities for future
needs.
Risk direction
Strategic objectives
3
6
• Performance appraisal process (PDR) and
Talent Review process are in place
• Individual development plans and career
development plans are set up
• Leadership development programmes in place.
• Improved external talent recruitment
capabilities
• Trainee programme Belgium and
Netherlands in place
• Our software solutions bring increased structure
and capabilities to learning and development
• Future leader programme is started last year
and new nominations for Future Leaders
programme for FY24 are done
The Diversity & Inclusion (D&I) Board is created
•
Due to the economic situation, the
unemployment rate is low and the talent remains
short in supply. This is offset by further optimising
the internal talent process to make sure talent will
not be lost.
This has been done through Talent reviews,
leadership development programmes and
improved external talent recruitment capabilities.
The Diversity & Inclusion (D&I) Board has been set
up and has started a full programme, with specific
trainings, the D&I day and more new initiatives.
13. Long-term contracts
That we enter into long-term contracts
at disadvantageous terms or we rely on
a small number of large contracts.
• Selective bidding on contracts, combined with
strict Board controls on entering any new major
contracts, are in place
Risk direction
Strategic objectives
1
• Detailed risk assessments and due diligence on
contracts are conducted
The Board’s caution regarding complex long-term
contracts remains.
The risks mainly reside in municipal contracts and
renewal risks in Maltha and Coolrec, where we are
reliant on a small number of large contracts.
Ongoing operational improvements for remaining
contracts continue.
RISK DIRECTION KEY:
Increase
Stable
Decrease
Renewi plcAnnual Report and Accounts 2023
97
KEY RISK
14. Input pricing
KEY MITIGATION
COMMENTARY
That market pricing may put pressure
on our margins.
• Prices are constantly monitored and reported
on via operational systems
High inflation and output price levels increases
our risk of margin erosion.
Risk direction
Strategic objectives
1
3
• To deliver cost leadership in core markets we
effectively manage our costs, both structurally
and operationally
• Where appropriate, we use longer-term
contracts to limit exposure
• Targeted price increases and dynamic pricing
are used to optimise margins
15. ICT failure and cyber threat
That ICT failure and/or cyber crime
causes business interruption or loss.
• Business continuity planning and testing in
place for ICT failure
Risk direction
Strategic objectives
1
3
• Awareness among employees raised through
ongoing cyber security awareness campaigns
and training
• Regular external security tests and
improvements throughout the year
• Security planned at design stage in all projects
and programmes
• Cyber resilience software in place
• Systems hardened with improved detection and
other mitigations
• 24/7 monitoring is in place with the security
operation centre
• Continued investment in upgraded systems
and infrastructure
We are pricing new business for margin over
volume and with clear minimum returns targets.
The inherent risk cyber threat remain high
and in line with last year. Reflecting the high
number of cyber attacks globally. We encountered
such attempts during FY23 and expect this trend
to continue.
We have strengthened our systems and processes
during the year. With the security operation centre
which is now fully functional, 24/7 monitoring
is in place.
We have also carried out awareness campaigns
and training for our employees about risks in the
digital environment to ensure consequences of
successful attempts are reduced.
The current risk for ICT failure is slightly reduced
due to these effective mitigations and general IT
controls in place.
STRATEGIC OBJECTIVES
1
4
Leader in recycling
Enable the circular economy
2
5
Leader in secondary material production
Reduce carbon emissions and waste
3
6
Selectively gain market share
Care for people
Strategic reportGovernance reportFinancial statementsOther information
98
Risk management CONTINUED
Climate risks – physical risks
Reference numbers are consistent with those used in the summary of key risks table.
KEY RISK
1. Extreme heat
KEY MITIGATION
COMMENTARY
Increases in maximum temperatures.
• Emergency response and contingency plans to
ensure business continuity
• Procedures for controlling temperatures at
some sites
• Fire detection and extinguishing systems
Main foreseen occurrences:
Increased likelihood of fires at sites due to
spontaneous combustion of waste.
Minor foreseen occurrences:
Heat-related illnesses, such as heat stroke.
Lower efficiency, intermittent operation or failure,
of equipment used for sorting and recycling
processes. Biological processes could be
disrupted or halted.
Additional energy to cool equipment, processes,
and sites.
2. Water stress and drought
Increases in water stress and drought.
• Some sites are already used to managing flow
of raw materials (woods for example) even
when low river levels
• A map of priority sites will be drafted in the
coming year to assess where new mitigation
plans need to be created
Lower river levels disrupt barge shipments of
products to destination sites.
Reduced water supplies may halt processing.
Water supplies may become more expensive
to procure.
Lower river levels during water stressed periods may
impact water discharge rates for waste processing
sites, resulting in reduced operational capacity.
Investment in additional water storage facilities.
3. Flooding
Extreme rainfall or coastal storm surges.
• Emergency response and contingency plans to
Damages to site equipment and infrastructure.
ensure business continuity
• Flood barriers at some sites located near water
courses (e.g. Jenkins Lane, UK)
Contamination of water due to mixing with waste
materials.
• Investment in extra water storage capacity at
Impact water discharge rates.
some processing sites
• Drainage systems at some sites designed to
manage storm water flows, with reference to
forward-looking scenarios
Investment in additional wastewater
storage facilities.
Coastal flooding could disrupt supply chains.
4. Storms and wind
Storms and extreme winds.
• Emergency response and contingency plans to
ensure business continuity
• Drainage systems at some sites designed to
manage storm water flows, with reference to
forward-looking scenarios
Storms and extreme winds may carry
debris and result in road blockages disrupting
supply chains.
Could lead to increased repairs of infrastructure.
Renewi plcAnnual Report and Accounts 2023 99
Climate risks – transition risks
Reference numbers are consistent with those used in the summary of key risks table.
KEY RISK
1.GHG pricing
Increasing pricing of GHG
emissions
2. Supply chain transparency
KEY MITIGATION
COMMENTARY
• While assessing how to consider and apply
carbon prices in our decisions, we are building
our carbon emission reduction plan as well as
considering advanced technologies for carbon
capture (example of the DIMMER project
currently being investigated)
Rising cost of carbon is a risk, due to the
expansion of EU/UK ETS scope to include Renewi.
Supply chain transparency
emissions.
• We will continue to improve as techniques
develop further
Lack of transparency could lead to
key stakeholders being disappointed
and unsupportive.
3. Lack of developing climate policies
Lack of developing climate policies
• We support and lobby for progressive
climate-related policies of governments in our
markets
Slow down climate actions could have a negative
effect on growth.
4. Volume/composition due to reduce/re-use
Changes in waste volume and
composition due to reduce and
re-use principles
• We encourage re-use and will continue to
actively monitor composition of inbound
streams for changes in customer behaviours
Revenues impacted to the downside due to
reduce and re-use principles. Fewer materials or
fewer high-value materials in inbound stream.
Financial risks
Renewi takes action to protect the business
against the most material financial risks. Our
key policies for control of financial risks are
detailed below.
INTEREST RATE RISK
Renewi has continued to limit its exposure
to interest rate risk on core borrowings by
using fixed-rate retail bonds, bank loans and
private placements. At the end of FY23, circa
85% of core borrowings were fixed.
Additionally, the PPP non-recourse
floating-rate borrowings are hedged for the
duration of the contracts using interest rate
swaps entered into as part of financial close
of the project.
FOREIGN EXCHANGE RISK
Renewi operates in the UK and is exposed to
translation risk into Euros on the value of
assets denominated in Sterling. The Group
has limited transactional risk, as the Group’s
subsidiaries conduct the majority of
business in their respective functional
currencies. Some risk arises in Euros for
the export of processed waste from the UK
to Europe.
COMMODITY PRICE RISK
Renewi is exposed to diesel price changes,
which are managed using forward contracts.
The Group manages other exposures to
prices of paper, plastics, metals, residual
fuels and other recyclates associated with
offtake through commercial contracting.
CREDIT RISK
Credit risk is the risk of financial loss where
counterparties are not able to meet their
obligations. The Group has implemented
the setting and monitoring of appropriate
customer credit limits, often supported by
credit insurance. Credit limits and
outstanding receivables are reviewed
monthly. The Group has a policy to ensure
that any surplus cash balances are held by
financial institutions meeting minimum
acceptable credit ratings.
FRAUD RISK
To mitigate the exposure to losses arising
from fraud committed on the Group or by its
employees, robust internal controls and
financial procedures are reviewed and
tested regularly.
Strategic reportGovernance reportFinancial statementsOther information 100
Viability statement
In accordance with Provision 31 of the UK
Corporate Governance Code, the Board has
assessed the prospects of the Group over a
period of more than 12 months and has
adopted a period of three years for the
assessment. This assessment was
considered in the context of the Group’s
five-year strategic planning process;
however, for this viability assessment only
the first three years are used. The
assessment of viability is modelled using the
business plan, within which the financials in
the past two years are largely extrapolations
of key assumptions used in the budgeting
process. The first three years of the plan
represents the period over which the
Group’s risk would have the most adverse
impact and is the period that the Group
gives most focus to in the forecasting
process. The strategic growth plan
represents the longer-term strategic goals of
the Group, including elements of our
innovation pipeline, which are expected to
deliver significant growth in the later years
of the five-year plan, but the benefits of any
projects not yet formally approved by the
Board are not included in our viability
assessment modelling.
The key assumptions made in Renewi’s
strategic planning financial model are:
economic growth and inflation resulting
from ongoing geopolitical instability;
continuing growth opportunities leading to
further margin improvements in the
Commercial Waste Division; long-term
recovery at ATM; and the delivery of the
Renewi 2.0 and other cost saving
programmes. The ATM recovery includes
returning to higher levels of soil production
levels along with the completion of
certification and ramp up of production of
higher-value secondary raw materials. The
Renewi 2.0 programme is forecast to deliver
a minimum of €20m of annual cost benefits
in FY24. It has been assumed for viability
modelling that the €75m Retail Bonds which
mature in July 2024 will be replaced and a
€370m RCF facility will be replaced with a
facility of equivalent value in FY25. The
Board is satisfied that is is reasonable to
assume we will be able to renew these
facilities under comparable terms.
The Board assessed the principal risks to
the business as set out in the preceding
pages and concluded that seven severe but
plausible risk scenarios should be tested
separately. We have also tested appropriate
combinations of scenarios. The risks
selected for modelling are considered to be
those with the most significant,
quantifiable potential impact in the
three-year period. The scenarios modelled
included up to 40% lower recyclate
product pricing due to challenges in the
offtake markets, a 2% decline in input
revenue due to lower volumes following an
economic downturn, a further 12-month
delay in the operational ramp-up at ATM
combined with increased plant downtime,
a 33% reduction in long-term cost
efficiencies from cost saving initiatives and
a cyber attack which severely impacts our
ability to operate for a period of up to one
month. For each scenario the Group has
also identified the mitigation steps it would
take to reduce the risk and performed the
scenario testing on that basis. These
mitigations include the deferral of capital
expenditure, working capital controls and
reduction of other discretionary cash flows.
The Group’s liquidity and covenant
headroom have been assessed and
incorporated within the risk-scenario
modelling. Based on the consolidated
financial impact of the sensitivity analysis
and associated mitigating actions that are
either in place or could be implemented, it
has been demonstrated that the Group
maintained headroom in the event of each
of the separate scenarios and the combined
scenarios occurring.
Having considered all of the elements of the
assessment, the Directors confirm they have
a reasonable expectation that the Group will
be able to continue in operation and meet
its liabilities as they fall due for the period
of assessment.
Renewi plcAnnual Report and Accounts 2023 101
Weight bridge, Coolrec
Dordrecht
Strategic reportGovernance reportFinancial statementsOther information 102
Section 172(1) statement
When making decisions, the Directors of
Renewi plc will always act in the way that
they believe will best promote the success
of the Company for the benefit of its
members as a whole, while also
considering the broad range of
stakeholders who interact with and
are impacted by our business.
Throughout the past year, the Board of
Directors has again acted to promote the
long-term success of the Company while
also having due regard to the matters set
out in Section 172(1) of the UK Companies
Act 2006.
Directors have had regard to those specific
factors as listed below, as well as others
that are relevant to the particular decisions
being made. The Board, however,
acknowledges that not every decision
may result in a positive outcome for
all stakeholders. By considering our
purpose and values, together with our
strategic priorities, the Board aims to
ensure that decisions are consistent and
intended to promote the Company’s
long-term success.
made for each stakeholder and describe
the strategic actions taken by the
Board, along with the outcomes of those
principal decisions.
The Company continued its engagement
with key stakeholders throughout the year
to deepen understanding of the issues and
factors that are significant for them. Our
key stakeholders are set out in the
Connecting with our Stakeholders section
on pages 121 to 126 of the Corporate
Governance Report. Here we identify the
relevance of each stakeholder to our
business model, describe how we engage
and the key issues of discussion, list
metrics to measure stakeholder
relationships and summarise the
outcomes of engagement. Further details
of how the Board discharged their Section
172(1) duties when making principal
decisions during FY22 are also set out on
page 127 of the Corporate Governance
Report. Here we report the considerations
Renewi is a waste-to-product company
and, as such, environmental and
sustainability matters are at the heart
of what we do. The consideration and
impact of the Group’s operations on the
environment and our wider contribution
to the circular economy are evidenced
throughout the Strategic Report section
of this Annual Report and also in our FY23
Sustainability Review, which will be
available on our website in late June 2023.
Our Directors recognise the importance of
increasing engagement with the widest
range of stakeholders, taking decisions
that will support the circular economy
and at the same time operating in a way
that helps secure the long-term success of
the business.
S172 Summary
S.172 FACTOR
a. Likely consequences of any decisions in the
long term
RELEVANT DISCLOSURE
Chairman’s statement (page 14)
CEO’s strategic review (page 30)
CFO’s financial review (page 36)
Enable the circular economy (page 50)
Reduce our carbon emissions (page 54)
Our key stakeholders (page 122 to 126)
Principal decisions in FY23 (page 127)
b. Interests of the Company’s employees
Employee engagement (page 124)
c. Need to foster the Company’s
business relationships with suppliers,
customers and others
d. Impact of the Company’s operations on the
community and environment
e. Desirability of the Company
maintaining a reputation for
high standards of business conduct
f. Need to act fairly between the members of
the company
Diversity (page 114)
Care for people (page 66)
Connecting with our stakeholders (page 121)
Modern slavery statement (renewi.com/en/our-policies)
Enable the circular economy (page 50)
Reduce our carbon emissions (page 54)
TCFD (climate) disclosures (page 59)
Communities (page 70)
What we do (page 22)
Who we do it for (page 24)
Business model (page 26)
Care for people (page 66)
Risk management (page 86)
Audit Committee Report (page 132)
Code of Conduct (renewi.com/en/our-policies)
Principal rights and obligations attaching to shares (page 159)
Annual General Meeting (page 160)
Shareholder engagement (page 117)
Renewi plcAnnual Report and Accounts 2023 103
Non-financial information statement
This section of the Strategic Report constitutes the Group’s Non-Financial
Statement for the purposes of sections 414CA and 414CB of the Companies Act
2006. The table below is intended to provide our stakeholders with the content
they need to understand our development, performance, position and the
impact of our activities with regard to specified non-financial matters.
Visit our website for a complete set of relevant environmental, social and governance policies. Our disclosures are
aligned to globally recognised reporting standards such as TCFD (see page 59), and UN Global Compact and
Sustainable Development Goals (see page 8). Further information on non-financial targets and performance data
can also be found in our sustainability review published June 2023.
REPORTING REQUIREMENT
1. Description of business model
SECTION OF ANNUAL REPORT
• Business model (page 26)
2. The main trends and factors likely to affect the future
development, performance and position of the Group’s business
• The world we live in (page 16)
• Operating review (page 72)
3. Description of the principal risks and any adverse impacts
of business activity
4. Non-financial key performance indicators
• Principal risks and uncertainties (page 91)
• TCFD report (page 59)
• Measuring our performance (page 12)
• Enable the circular economy (page 50)
• Reduce our carbon emissions (page 54)
• Care for people (page 66)
REPORTING
REQUIREMENT
RENEWI POLICIES, PROCESSES
AND STANDARDS WHICH GOVERN
OUR APPROACH*
RISK MANAGEMENT
SECTION OF ANNUAL REPORT
5. Environmental
• Environmental policy
• Regulatory compliance risk
matters
(page 96)
• CEO’s strategic review (page 30)
• Enable the circular economy
• TCFD Report (page 59)
(page 50)
6. Employees
7. Human rights
• Code of Conduct
• Human Rights Statement
• Raising Concerns and
Anti-Retaliation Policy
• Health & Safety Policy
• Diversity, Equity & Inclusion Statement
• Business Partner Code of Conduct
• Human Rights Statement
• Modern Slavery Statement
• Health and safety risk (page 94)
• Labour availability and cost risk
(page 95)
• Talent development, leadership
and diversity risk (page 96)
• Reduce our carbon emissions
(page 54)
• CEO’s strategic review (page 30)
• Care for people (page 66)
• Diversity (page 114)
• Stakeholder engagement
(page 121)
• Regulatory compliance risk
(page 96)
• Our customers (page 24)
• Care for people (page 66)
8. Social and
• Human Rights Statement
• Regulatory compliance risk
community matters
(page 96)
• Care for people (page 66)
• Stakeholder engagement
(page 121)
9. Anti-corruption and
anti-bribery
• Code of Conduct
• Anti-Bribery and Corruption (ABC) Policy
*Some policies, processes and standards shown here are not published externally.
• Regulatory compliance risk
• Governance (page 136)
(page 96)
Strategic reportGovernance reportFinancial statementsOther information GOVERNANCE
REPORT
Secondary material
Maltha, recycled solar panels,
part of the Photorama project
106
The Board
of Directors
Renewi’s Board of Directors supports the Company
with an impressive range of skills and extensive
experience across many disciplines.
BEN VERWAAYEN, MSc
Chairman
ALLARD CASTELEIN, MD
Senior Independent Director
KATLEEN
VANDEWEYER, MSc
Non-Executive Director
JOLANDE SAP, MSc
Non-Executive Director
Appointed April 2020.
Skills and experience
Ben has a breadth of
experience, having been the
CEO of several companies,
including Alcatel-Lucent SA
and BT plc. He held the position
of vice chairman and chief
operating officer of Lucent
Technologies Inc, was president
of KPN and a non-executive
director of Bharti Airtel. He has
also been chairman of a number
of companies and industry
bodies including the CBI Energy
and Climate Change Board in
the UK. Ben currently serves as
a non-executive director on the
boards of Ofcom and Akamai
Technologies Inc. He is a
Founding Partner at venture
capital company Keen Venture
Partners LLP. Ben graduated
from Utrecht University with
a master’s degree in Law
and International Politics.
Appointed January 2017.
Skills and experience
Appointed as President and
CEO of the Port of Rotterdam in
2014, Allard will be stepping
down from this position at the
end of July 2023. He qualified as
a medical doctor before
pursuing an international career
in the energy sector, holding
a number of senior positions
at Shell in various countries,
culminating in the post of Vice
President Environment of Royal
Dutch Shell in 2009. He is a
Supervisory Board member
of SBM Offshore N.V and
Heijmans N.V, a Non-Executive
Director of Associated British
Ports and a senior member
of several Dutch trade
organisations including
the Economic Board of Zuid
Holland and the Confederation
of Netherlands Industry
and Employers.
Appointed December 2022.
Skills and experience
Katleen brings a wealth of
experience in finance and
auditing, most recently until
July 2022 in her role as Deputy
Chief Financial Officer at
Belgian-listed company
Proximus PLC, an international
provider of digital services,
communication and ICT
solutions. Prior to Proximus,
she held various leadership
positions including that of
CFO at Worldline S.A. and Arthur
Andersen. She currently serves
as Non-Executive Director
on the Boards of Fedrus
International BV, Ageas Group,
AG Insurance and Vantiva S.A;
she also sits on the Audit
committees of both Ageas
Group and AG Insurance.
Previously, she sat on the
Boards of Ion Beam Applications,
bpost bank, Connectimmo N.V,
Scarlet N.V. and Proximus
Pension Fund. She holds a
degree in Applied Economics
from the University of Leuven.
Appointed April 2018.
Skills and experience
Jolande is chair of the Social
Impact Team that advises the
Dutch government on the social
impact of pandemics and
disruptive crises, a member of
the Board of the Dutch Emissions
Authority, vice chair of the
Supervisory Board of KPMG, and
a member of the Supervisory
Board of Royal KPN N.V. She is
also involved in several social
initiatives, including Chair of the
Smoke free table of the Dutch
National Prevention Agreement,
the Springtij Forum, and the
Impact Economy Foundation.
Between 2008 and 2012, Jolande
represented the Dutch Green
Party, GroenLinks, in the lower
house of the Dutch parliament,
leading the party from 2010.
Previously Jolande was an
economist in science, policy and
business, head of the Incomes
Policy department at the Ministry
of Social Affairs and
Employment, and director of the
LEEFtijd centre of expertise.
Jolande graduated from the
Tilburg University in economics.
Key: Committee Membership:
Audit
Nomination
Remuneration
Safety, Health and Environment
Chair
Renewi plcAnnual Report and Accounts 2023
107
LUC STERCKX, MSc, PhD
Non-Executive Director
NEIL HARTLEY, MA, MBA
Non-Executive Director
OTTO DE BONT, MSc
Chief Executive Officer
Appointed April 2019.
Skills and experience
Otto was promoted to the role
of Chief Executive Officer in April
2019. Prior to this, he was the
Managing Director of Renewi’s
Commercial Waste Netherlands
Division, playing a central role in
the integration of Shanks Group
plc with Van Gansewinkel Groep
B.V. Before joining Renewi,
Otto worked for a number of
blue-chip companies including
United Technologies’ divisions
Otis, Carrier and Chubb, and
General Electric’s Plastics and
Security divisions. During his
six years at United Technologies,
Otto spent time in various
managerial positions culminating
in his role as president of Chubb
Continental Europe.
Appointed September 2017.
Skills and experience
Luc started his career at Exxon
Chemicals, before becoming
the CEO of Indaver and
subsequently joining the
executive committee of
PetroFina, where he served
as managing director of Fina
Holding Deutschland and
as group senior vice president
for SHEQ matters worldwide.
He was then appointed
CEO of Oleon where he led
a successful management
buyout. Luc was subsequently
appointed as CEO of SPE-
Luminus in 2005, the second
largest power and gas company
in Belgium, created as a result
of a multi-party merger.
Luc is an INSEAD-certified
international director
and a specialist in internal
governance. He currently holds
a number of non-executive and
advisory positions, specialising
in the fields of energy and
chemicals, renewables
and corporate governance.
Appointed January 2019.
Skills and experience
Neil is a Partner at Buckthorn
Partners, a private equity firm
that invests in businesses that
support the integration of
renewable energy, lowering
emissions, increasing energy
efficiency, decarbonisation of
industrial processes and other
improvements to existing
energy infrastructure. He has
an MBA from Harvard Business
School and is also a graduate
of Oxford University in
engineering, economics and
management. Neil has a total
of 16 years in private equity
and, prior to that, spent six
years in investment banking
with Simmons & Company
International, specialising in
corporate finance, M&A and
capital raising in the energy
sector. Neil has also been a
management consultant at
McKinsey & Company Inc and
spent seven years in technical
and line management roles with
Schlumberger as a field service
manager and field engineer.
ANNEMIEKE DEN OTTER,
MA, RC
Chief Financial Officer
Appointed June 2022.
Skills and experience
Annemieke joined the Board on
1 June 2022. Previously she held
the position of CFO of ERIKS,
a €1.7bn revenue global
engineering components and
service provider (privately
owned and part of SHV group).
From 2016 she served for five
years as the CFO of Ordina,
a Dutch software company
listed on the Amsterdam Stock
Exchange. Since 2020, she has
been a Supervisory Board
member of ForFarmers N.V.
Annemieke holds a master’s
degree in English and Literary
Science from the Vrije
Universiteit, Amsterdam, and
has a post-master’s degree in
finance and control from
Erasmus University, Rotterdam
(Register Controller in Dutch).
Strategic reportGovernance reportFinancial statementsOther information
108
The Executive
Committee
Our Committee is a strong combination of industry experts
and talented leaders from other sectors – benefitting Renewi
with both specialist knowledge and broad experience.
MARC DEN
HARTOG
Managing Director,
Commercial Waste
Netherlands
Skills and experience
Marc joined Renewi in
2021 as Managing
Director, Commercial
Waste Netherlands.
He previously worked
for Corbion N.V.,
a multinational
company where
he held a number
of senior management
positions. Prior to
this, he held senior
positions at Croklaan
and at Unilever.
Marc holds a master’s
degree in Chemistry
from the University
of Leiden.
THEO OLIJVE
Managing Director,
Mineralz & Water
Skills and experience
Theo joined Renewi
in 2019. He worked in
senior management
positions in the
petrochemical
industry and liquid
bulk terminals for
more than 25 years.
Theo was divisional
vice president for
LyondellBasell, where
he was responsible for
global manufacturing.
He was also managing
director of the Odfjell
Terminal Rotterdam,
where he was
responsible for
restoring operation
and compliance after
a safety shutdown
in 2012. Theo holds
a master’s degree in
Chemical Engineering
from the University
of Groningen.
MARK THYS
Managing Director,
Commercial Waste
Belgium
JAMES
PRIESTLEY
Managing Director,
Specialities
HELEN
RICHARDSON
Human Resources
Director
MAARTEN
BUIKHUISEN
Chief Information
Officer
Skills and experience
Mark joined Renewi
in 2021 as Managing
Director, Commercial
Waste Belgium. He
previously worked
for Eurofins Scientific,
where, from 2019,
he held the position
of global chief
transformation officer.
Prior to that, he built
his career at Goodyear
Dunlop, completing
various international
assignments and
holding a number
of senior positions.
Mark holds a master’s
degree in Commercial
Engineering and an
Executive MBA in
Business Management.
Skills and experience
James was appointed
as Managing Director
of the Municipal
Division in 2016. He
has a wide range of
experience running
and improving
businesses in Europe
and America. Prior
to joining, he was
president Europe for
RGIS, an inventory
services company
owned by Blackstone.
After starting his career
at ICI, he moved
on to gain extensive
management
experience at Ford,
British Airways and
Tesco, and consulting
with Alix Partners.
He has a degree in
Chemical Engineering
and an MBA.
Skills and experience
Helen joined Renewi
in April 2019 as HR
Director. Helen has a
strong track record
in international HR
leadership roles. She
has worked across
various industries
including FMCG,
telecommunications,
real-estate
development and
retail. Most recently,
Helen held various
HR leadership roles
at Danone Nutricia.
During this period,
Helen played a
leading role in the
integration of several
businesses,
professionalising HR
by driving employee
engagement, putting
talent management
at the heart of the
organisation and
improving HR services.
Skills and experience
Maarten joined
Renewi in January
2020 with more than
20 years of IT
experience, having
worked in a number
of global IT leadership
roles. Prior to joining
Renewi, Maarten had
various international
business and IT roles
at Heineken, an
internet B2C start-up
and at Alcatel in
telecommunication.
During this period, he
delivered business
and IT transformations,
global ERP
programmes, digital
innovations and
data-driven
organisations.
Maarten has a
bachelor’s degree
in Information
Technology and
an MBA from the
University of Bradford.
While the Executive Committee does not have specific powers of its own delegated by the Board, the Chief Executive Officer is assisted in the
performance of his duties by the Executive Committee, which meets monthly and comprises the Chief Executive Officer, Chief Financial Officer,
Divisional Managing Directors and Corporate Function Leaders.
Renewi plcAnnual Report and Accounts 2023 109
PATRICK
DEPREZ
Product Sales
Director
Skills and experience
Patrick has been a
member of the Group
since 1998. He has
held various roles
including Belgium
Regional Director,
Group SHEQ, and has
been a member of the
Executive Committee
since 2012. Before
joining the Group, he
was the head of the
waste division at B&P
Sobry NV for almost
10 years. Patrick
has a degree in
environmental
management.
DANIËL POST
Transformation
Director
Skills and experience
Daniël joined
Renewi in 2020
as Transformation
Director. Before
joining Renewi,
Daniël spent more
than 23 years in the
energy and oil and
gas industries,
first working for
Schlumberger,
where he started his
international career,
and then at GE Oil
& Gas in operational
and commercial line
management roles.
Daniël holds an MSc
in Mining & Petroleum
Engineering from
Delft University
of Technology and
an MBA from IMD.
BAUKJE
DREIMULLER
General Counsel
Skills and experience
Baukje has extensive
experience from
leading legal firms
Simmons & Simmons,
Ashurst and Houthoff.
She joined Renewi in
2017 from Houthoff,
where she held the
position of senior
lawyer within the
corporate transaction
(M&A) department. In
this capacity, Baukje
was very closely
involved with the
VGG-Shanks merger,
having led much of
the deal-related legal
activity. Baukje holds
master’s degrees in
both Dutch Law and
International and
European Law from
Radboud University
in Nijmegen.
JEANINE
PEPPINK-VAN
DER STERREN
SHEQ Director
Skills and experience
Jeanine joined Renewi
in October 2021 as
Group SHEQ Director.
Previously, she was
Group SHEQ-CSR
Director for Royal IHC
and lead assessor and
environmental verifier
for Lloyd’s Register.
Other senior positions
involved overall
responsibility for
quality assurance and
control, environment,
health and safety,
security and
sustainability.
Jeanine holds a
master’s degree
from the University
of Technology
of Eindhoven in
Industrial Engineering
& Management
Science and an
MBA from the
Vlerick University.
BAS VAN GINKEL
Strategy and
Business
Development
Director
Skills and experience
Bas joined Renewi
in 2018 as Strategy
Director and was
promoted to join
Renewi’s Executive
Committee in
February 2019.
Prior to joining
Renewi, Bas held
senior positions at
Philips Lighting and
Bain & Co. He holds
an MBA from Harvard
Business School
in the US, plus
an MSc in Business
Administration and
a BSc in Economics
from the University
of Groningen.
MARIEKE
VAN WICHEN
Director
Communications
Skills and experience
Marieke joined
Renewi in July 2022,
bringing over
15 years’ experience
in international
marketing and
communications.
Prior to joining
Renewi, Marieke
fulfilled a range of B2B
and B2C global
communications
roles, most recently at
Philips. Earlier in her
career, Marieke
worked in advertising.
Marieke holds a
Bachelor’s degree
in Communications.
Key:
Divisional Managing Director
Corporate Function Leader
as of 31 March 2023
Our CEO and CFO are also members
of the Executive Committee.
See their biographies on page 107.
Strategic reportGovernance reportFinancial statementsOther information 110
Customer Care
Amersfoort
Renewi plcAnnual Report and Accounts 2023 111
Governance
at a glance
A snapshot guide to corporate governance at Renewi – committee
reporting to the Board of Directors, and Board membership,
attendance and the meetings calendar during FY23.
Principal decisions
Information about some of the decisions and discussions that were
material or strategic to the Group and significant to our stakeholder
groups can be found on page 127.
page 127
Our Board
75%
Board independence
(FY22: 75%)
37.5%
Female representation
(FY22: 25%)
8
Number of Board meetings
(FY22: 11)
4
Board Committees
(FY22: 4)
Connecting with
our stakeholders
Our approach to workforce
engagement, how we
engaged with our
stakeholders over the course
of the year and the outcomes
of our engagement can be
found from page 121
onwards, where we look in
detail at our key stakeholder
groups: waste-producing
customers, product
customers, innovation
partners, suppliers,
employees, local
communities, government,
regulators, investors, lenders
and the global community.
page 121
Introducing our new NED
We appointed Katleen Vandeweyer
as a new Non-Executive Director
on 1 December 2022. She succeeds
Marina Wyatt, who left the Board
in July 2022, as Chair of the Audit
Committee. To find out more about
Katleen, see our questions and
answers on page 119, where you
can find out about what attracted
Katleen to Renewi and the skills and
experience she is bringing to the role.
page 119
Engaging with our workforce
Find out about our approach to workforce engagement and
how our Board-designated Non-Executive Director, Jolande
Sap, assisted the Board with workforce engagement.
page 128
Director tenure
3
1–3 years
3
3–5 years
2
5–7 years
Strategic reportGovernance reportFinancial statementsOther information 112
Corporate
Governance Report
This report explains the structures, processes and procedures
employed by the Board to ensure that Renewi’s high standards
of corporate governance are maintained throughout the Group.
On behalf of the Board, I am pleased to present our Corporate
Governance Report and confirm our compliance with the UK
Corporate Governance Code published in July 2018, for the year
ended 31 March 2023.
We believe that both the Board collectively and Directors individually
have a responsibility to set and demonstrate high standards of
corporate governance. The following pages outline the structures,
processes and procedures by which the Board ensures that these
high standards are maintained throughout the Group.
With the relaxation of the Covid-19 restrictions, the Board and its
Committees resumed in-person meetings, combined with site visits,
as well as making use of technology to hold hybrid and virtual
meetings. By whichever means, the Board and its Committees
continued to meet regularly, collaborate and maintain control of
governance processes and activities in what has been a challenging
year from global socio-political and macroeconomic perspectives.
Over the course of the year, the Board has continued to demonstrate
compliance with the Companies (Miscellaneous Reporting)
Regulations 2018 and the revisions to the Corporate Governance
Code. The Report includes a statement disclosing its compliance
with the UK Corporate Governance Code 2018, which can be found
on pages 116 to 120, and a disclosure of how the Company engages
with its stakeholders, which can be found on pages 121 to 128.
The Non-Executive Directors, all of whom the Company regards as
independent, bring considerable international experience to the
Board across a number of sectors. They play a full role in
constructively challenging and developing strategic proposals, as
well as chairing and being members of Board Committees. The
Executive Directors implement Board strategy to deliver growth and
returns by driving margin expansion, investing in infrastructure and
actively managing the portfolio of businesses. In particular, the
Board ensures that the Group as a whole remains committed to
achieving the highest standards of legal compliance, environmental
protection and safety.
The Board is required to confirm that the Annual Report and
Accounts, taken as a whole, is fair, balanced and understandable,
and provides the information necessary for shareholders to assess
the Group’s performance, business model and strategy. The Audit
Committee has again assisted the Board in its assessment of these
matters, together with those of Going Concern and Viability
Statement disclosures. The full Audit Committee Report is set
out on pages 132 to 136.
STRUCTURE OF THE GOVERNANCE SECTION
Renewi’s governance framework
Renewi’s Board Committees
How Renewi has complied with the
UK Corporate Governance Code
page 115
page 115
page 116
Connecting with our stakeholders
page 121
Principal decisions in FY23
Engaging with our workforce
Safety, Health and Environment
Committee Report
Audit Committee Report
Nomination Committee Report
Directors’ Remuneration Report
Other disclosures
page 127
page 128
page 130
page 132
page 137
page 140
page 158
Directors’ responsibilities statement
page 161
Renewi plcAnnual Report and Accounts 2023 113
This year, the Board has again been particularly focused on Renewi’s
investments and innovation pipeline, which you can read more
about in the Strategic report.
The Safety, Health and Environmental Committee continues
to make good progress with the implementation of International
Sustainability Rating System (ISRS), a structured framework for
managing safety and sustainability processes.
Further to the appointment of Annemieke den Otter as the
new Chief Financial Officer on 1 June 2022, the Nomination
Committee was also engaged in the year with the selection
of a new Non-Executive Director. Following an extensive search,
Katleen Vandeweyer was appointed on 1 December 2022. She was
appointed to fill the vacancy as Chair of the Audit Committee
following Marina Wyatt’s stepping down from the Board at the 2022
AGM after nine years’ service.
The Remuneration Committee was similarly focused on considering
Board composition and succession. It also undertook through
consultation a triennial review of the Remuneration Policy which
shareholders are being asked to vote upon at the forthcoming AGM.
The full Committee reports can be found on pages 130 to 157.
Ben Verwaayen
Chairman
25 May 2023
The Board fully supports the principles of good corporate
governance. The Corporate Governance Report, together with
the Directors’ Remuneration Report on pages 140 to 157,
explains how the Group has applied and complied fully with the
provisions of the UK Corporate Governance Code 2018 for the
year to 31 March 2023.
THE BOARD
The Board comprises the Chairman, a further five independent
Non-Executive Directors, the Chief Executive Officer and the Chief
Financial Officer.
The Chairman, who is independent, has primary responsibility for
running the Board. The Chief Executive Officer is responsible for
the operations of the Group and for the development of strategic
plans and initiatives for consideration by the Board. The formal
division
of responsibilities between the Chairman and the Chief Executive
Officer has been agreed by the Board and documented, a copy
of which is available on the Group’s website.
The Non-Executive Directors bring a wide range of experience
to the Group and are considered by the Board to be independent
of management and free from any business or other relationship
that could materially interfere with the exercise of their
independent judgement.
The Non-Executive Directors make a significant contribution
to the functioning of the Board, thereby ensuring that no
individual or group dominates the decision-making process.
Non-Executive Directors are not eligible to participate in any of the
Company’s share option or pension schemes. The Chairman also
meets and communicates regularly with the Non-Executive
Directors without the presence of the Executive Directors.
The Senior Independent Director is available to shareholders in
instances where the Chairman, Chief Executive Officer or Chief
Financial Officer have failed to resolve the concern, or where such
contact is inappropriate.
BOARD GOVERNANCE
There is a formal schedule of matters reserved specifically for the
Board’s decision. These include approval of financial statements,
strategic policy, acquisitions and disposals, capital projects over
defined limits, annual budgets and new borrowing facilities. The
Board meets regularly, having met eight times during the year.
Strategic reportGovernance reportFinancial statementsOther information 114
Corporate Governance Report CONTINUED
The Board is provided with appropriate information in a timely
manner to enable it to discharge its duties effectively. All Directors
have access to the Company Secretary, whose role includes
ensuring that Board procedures and regulations are followed.
In addition, Directors are entitled, if necessary, to seek independent
professional advice in connection with their duties at the
Company’s expense.
In recognition of the importance of their stewardship responsibilities,
the first standing item of business at every scheduled Board meeting
is the consideration of health and safety and environmental matters.
Other regular reports include those from the Chief Executive Officer
and Chief Financial Officer, covering business performance, markets
and competition, investor and analyst updates, as well as progress
against strategic objectives and capital expenditure projects. The
Board also remain responsible for setting strategic aims and
objectives in relation to sustainability and climate change.
All Directors are required to notify the Company on an ongoing basis
of any other commitments. Through the Company Secretary, there
are procedures for ensuring that the Board’s powers for authorising
Directors’ conflicts of interest are operated effectively.
Four formal Committees (Audit, Remuneration, Nomination,
and Safety, Health and Environment) further support the work
of the Board.
In addition, while not a committee with specific powers of its own
delegated by the Board, the Executive Committee assists the Chief
Executive Officer in the performance of their duties. This Committee
meets monthly and comprises the Chief Executive Officer and Chief
Financial Officer, the Divisional Managing Directors and Corporate
Function Leaders. In addition, there are a number of specialist
committees covering Investments, Sustainability Reporting, Data/IT
and cyber security and Diversity & Inclusion.
In reviewing Renewi’s overall corporate governance arrangements,
the Board continues to give equal consideration to balancing the
interests of customers, shareholders, employees and the wider
communities in which Renewi operates.
BOARD INDUCTION AND DEVELOPMENT
On appointment, Directors are given an introduction to the Group’s
operations, including visits to principal sites and meetings with
operational management. Specific training requirements of Directors
are met either directly or by the Company through legal/regulatory
updates. During the year a number of presentations and discussions
were held on the subject of cyber security.
DIVERSITY
All Board appointments are based on merit and against objective
criteria, but within this context the Board believes that diversity and
inclusion, in its broadest sense, including gender and ethnicity,
should be promoted, as they are an important factor in Board
effectiveness. In particular, role profiles for any Board vacancies
will incorporate any necessary skills or strengths that may be
required, to either fill any gaps or complement existing Board
member competencies.
Renewi is committed to offering a rewarding, diverse and inclusive
working environment. On gender diversity, Renewi has set a target
to increase the percentage of women across the business to 25% by
2025. From 1 April 2022, listed companies such as Renewi have been
required to have 40% female representation on their boards, and
at least one female in a senior board position. Renewi fully supports
these requirements and the importance of diversity in the
boardroom. Currently three Board members are female, including
Annemieke den Otter, who holds the position of Chief Financial
Officer. As a Board of eight members, the three female directors
make up 37.5% of the total, which is close to the requirement and is
consistent with a 40% ambition when considering Board succession.
Table for reporting on gender identity or sex
Men
Women
Number of
Board members
Percentage
of the Board
Number of senior
positions on the
Board (CEO, CFO,
SID and Chair)
Number in
Executive
management1
Percentage
of Executive
management
5
3
62.5%
37.5%
3
1
9
5
64.3%
35.7%
as at 31 March 2023
1. Executive management defined as the Executive Committee.
Table for reporting on ethnic background2
Number of
Board members
Percentage
of the Board
Number of senior
positions on the
Board (CEO, CFO,
SID and Chair)
Number in
Executive
management1
Percentage
of Executive
management
White British or other White
(including minority-white groups)
Mixed/Multiple Ethnic Groups
Asian/Asian British
Black/African/Caribbean/Black British
Other ethnic group, including Arab
Not specified/prefer not to say
as at 31 March 2023
1. Executive management defined as the Executive Committee.
2. Data obtained from individuals directly.
8
–
–
–
–
–
100%
–
–
–
–
–
4
–
–
–
–
–
14
–
–
–
–
–
100%
–
–
–
–
–
Renewi plcAnnual Report and Accounts 2023 115
Governance framework
BOARD OF DIRECTORS
Audit Committee
Principal
Board
Committees
SHE (Safety, Health
and Environment)
Committee
Remuneration
Committee
Nomination
Committee
See pages 132–136
See pages 130–131
See pages 140–157
See pages 137–139
EXECUTIVE COMMITTEE
Specialist
Committees
Investment
Committee
Data and
IT Board
Treasury
Committee
Diversity &
Inclusion Board
OPERATING DIVISIONS
Renewi is also supportive of the Parker Review Committee
recommendations and the recent requirement of listed companies
to have at least one board member from an ethnic minority. As at 31
March 2023, there are no vacancies identified on the Board but the
Nomination Committee will be supporting the Board in identifying a
suitable candidate when a vacancy arises, in order to fulfil this
recommendation by 2024 or soon after.
You can read more about our approach to Board diversity in the
Nomination Committee Report on page 137.
The Nomination Committee and the Board continue to closely
monitor all aspects of diversity in recruitment and promotions
across the workforce. To assist in the process, a Diversity and
Inclusion Board has been appointed to help advise the Board on
how to embed diversity and inclusivity within the organisation.
Statistical employment data for the Group can be found in the
Sustainability Review, which is available on the Renewi website.
Further summary details, in addition to those shown below
including those on gender pay gap reporting, can also be found in
the Care for People section from page 66.
AUDIT COMMITTEE
The Audit Committee met four times during the year and is formally
constituted with written terms of reference, which are available on
the Group’s website. The Committee is made up solely of Non-
Executive Directors: Katleen Vandeweyer, who has chaired the
Committee since 1 December 2022, Neil Hartley, Luc Sterckx and
Jolande Sap.
As required under the UK Corporate Governance Code, Katleen
Vandewyer has current and relevant financial experience.
The Board considers that the Audit Committee as a whole has
competence relevant to the waste-to-product sector.
The Executive Directors and representatives from the external
auditors are regularly invited to attend meetings. The Committee
also has access to the external auditors without the presence of
the Executive Directors.
The Audit Committee Report on pages 132 to 136 sets out the role
of the Committee and its main activities during the year. This
includes responsibility for reviewing the methodology and
approach for reporting in support of strategy set by the Board in
relation to sustainability and climate change.
REMUNERATION COMMITTEE
The Remuneration Committee met three times during the year
and is formally constituted with written terms of reference, which
are available on the Group’s website. The Committee is made up
solely of Non-Executive Directors: Neil Hartley, who chairs the
Committee, Allard Castelein and Luc Sterckx. The Committee
formulates the Company’s Remuneration Policy and the
individual remuneration packages for Executive Directors. The
Committee also determines the remuneration of the Group’s
senior management and that of the Chairman.
The Committee recommends the remuneration of the Non-
Executive Directors for determination by the Board. In exercising
its responsibilities, the Committee has access to professional
advice, both internally and externally, and may consult
the Chief Executive Officer about its proposals. The
Directors’ Remuneration Report on pages 140 to 157 contains
particulars of Directors’ remuneration and their interests in the
Company’s shares.
Strategic reportGovernance reportFinancial statementsOther information 116
Corporate Governance Report CONTINUED
NOMINATION COMMITTEE
The Nomination Committee met five times during the year and
is formally constituted with written terms of reference, which are
available on the Group’s website. The Committee is made up solely
of Non-Executive Directors: Ben Verwaayen, who chairs the
Committee, Allard Castelein, Jolande Sap, Neil Hartley, Luc Sterckx
and Katleen Vandeweyer.
The Committee is responsible for making recommendations to the
Board on the appointment of Directors and succession planning. It
also reviews organisation and resourcing plans for the purpose of
providing assurance that appropriate processes are in place to
ensure a sufficient supply of competent executive and senior
management.
The Nomination Committee Report on pages 137 to 139 sets out the
role of the Committee in further detail and its main activities during
the year.
SAFETY, HEALTH AND ENVIRONMENT COMMITTEE
The Safety, Health and Environment Committee met four times
during the year and is formally constituted with written terms
of reference, which are available on the Group’s website. The
Committee is made up solely of Non-Executive Directors:
Luc Sterckx, who chairs the Committee, Allard Castelein
and Neil Hartley.
The Committee is responsible for making recommendations to the
Board over safety, health and environmental matters. It reviews
safety, health and environmental performance, providing guidance
on the implementation of appropriate measures to protect the
environment and keep people safe.
The Safety, Health and Environment Committee Report on pages 130
to 131 sets out the role of the Committee in further detail and its main
activities during the year.
OTHER INFORMATION
Other information necessary to fulfil the requirements of the
Corporate Governance Statement, relating to the Company’s share
capital structure and the appointment and powers of the Directors,
can be found in the Other disclosures section on pages 158 to 160.
Board meetings and attendance in FY23
How Renewi has complied with
the UK Corporate Governance Code
Renewi’s statement of compliance, together with the wider
Corporate Governance Report and other sections of this Annual
Report, describes how the Company has applied the main
principles of good governance in the UK Corporate Governance
Code, published by the UK Financial Reporting Council (FRC) in
July 2018, a copy of which is available on its website, frc.org.uk.
Renewi complied throughout the accounting period with the
provisions of the UK Corporate Governance Code.
BOARD LEADERSHIP AND COMPANY PURPOSE
A The Board’s role
The Board comprises Directors from a diverse range of
skills, nationalities and professional backgrounds, as set out in
their biographies on pages 106 to 107 and on pages 137 to 139 of
the Nomination Committee Report. It is this diversity of
experience and ability to exercise independent and objective
judgement that helps the Board to operate effectively and
establish a governance framework to assist the Group in the
delivery of its strategy.
The Board discharges its responsibilities, as set out in the
Corporate Governance Report on pages 112 to 128, through a
programme of Board and Committee meetings which include
reviews of financial performance, critical business issues and
short- and long-term planning and strategies.
B Renewi’s purpose, values and culture
Renewi’s purpose is to protect the world by giving new life
to used materials. The Group focuses on making valuable
products from waste, rather than on its disposal through
incineration or landfill. The Company meets the growing need to
deal with waste sustainably and cost-effectively and is positioned
higher up the value chain in the segments expected to show the
highest structural growth. Renewi’s values are the foundation for
everything that Renewi does and has helped the Group build a
culture of togetherness and One Renewi. They illustrate that how
Renewi acts is just as important as what Renewi does. The Group
uses its values as a guide for behaviours and decision-making.
Board
Audit Committee
Remuneration
Committee
Nomination
Committee
Safety, Health
and Environment
Committee
Number of meetings held
Ben Verwaayen
Allard Castelein*
Marina Wyatt
Jolande Sap**
Luc Sterckx
Neil Hartley
Katleen Vandeweyer
Otto de Bont
Annemieke den Otter
8
8 (8)
7 (8)
3 (3)
8 (8)
8 (8)
8 (8)
3 (3)
8 (8)
6 (6)
4
1 (1)
3 (4)
4 (4)
4 (4)
2 (2)
3
2 (3)
3 (3)
3 (3)
5
5 (5)
5 (5)
3 (3)
5 (5)
5 (5)
5 (5)
1 (1)
4
3 (4)
4 (4)
4 (4)
Bracketed figures indicate maximum potential attendance of each Director.
* Allard Castelein’s absences were due to scheduling challenges in the month of November 2022.
** Jolande Sap’s absence from one Committee meeting was due to unforeseen personal circumstances.
After the conclusion of every Board meeting the Chairman holds a private meeting with the Non-Executive Directors without the presence of the Executive Directors.
Renewi plcAnnual Report and Accounts 2023 The Board has designated Non-Executive Director Jolande Sap with
responsibility for monitoring workforce culture and employee
engagement. Together with the Group HR Director, Jolande also has
responsibility for making regular reports to the Board. For more
information, see the Engaging with our Workforce section on page 128.
The Audit Committee received regular updates on a range of risk
and compliance matters including reports and presentations on
whistleblowing and integrity issues as well as the results of internal
audits, which provided insight into the risk and control environment
both within the Group and within individual areas of the business.
The Committee reviewed the steps taken by senior management to
address weaknesses identified. Where concerns remained, the
Committee ensured further action was taken, including requesting
further information monitoring and, if required, follow-up audits. For
more information, see pages 132 to 136.
As part of its considerations, the Remuneration Committee also
reviewed the Company’s approach to rewarding the workforce.
C Resources and controls
The Board ensures that necessary resources are in place to
help the Company to meet objectives and measure performance.
The Board ensures that necessary resources are in place to help the
Company meet its objectives and measure performance. The system
of internal control is based on a continuous process of identifying,
evaluating and managing risks, including the risk management
framework outlined on page 87. The Group Risk Management
Department, together with risk owners from the divisions and
functions, is an important component of our risk management and
controls architecture. It provides direct assurance to the Audit
Committee on a number of matters, including the preparation and
review of risk registers and the promotion of risk awareness. The
Group Risk Management Department works with the operating
Divisions of our organisation to share outcomes and to co-ordinate
reporting on compliance matters. Complementing this, our internal
key controls framework ensures monthly execution and review of our
key financial controls. Our internal audit function aims to improve
Renewi’s overall control framework and evaluate and improve the
design and effectiveness of control processes, reporting the results of
its activities to the Audit Committee. The Board has a formal system
in place for Directors to declare any conflicts, or potential conflicts,
of interest.
D Shareholder engagement
The Board aims to engage with shareholders and understand
their issues and concerns. Whether from large institutional or smaller
private shareholders, the Board endeavours to respond to all queries
and questions, although responses may be facilitated through
management. Renewi aims to present a balanced and understandable
assessment of our strategy, financial position and prospects when
reporting to shareholders and other interested parties. The investors
pages of renewi.com contain a wide range of information of interest
to institutional and private investors. Board members are kept
informed of any issues and receive regular reports and presentations
from executive management and our advisers to assist them in
developing an understanding of our major shareholders’ views
of Renewi.
In recent years all Board members have attended the AGM to answer
questions raised by shareholders, including private investors. Details
of proxy voting by shareholders, including votes withheld, are given
at the AGM and are posted on our website following the AGM.
117
All resolutions were approved by shareholders at the Company’s
2022 AGM. This year’s AGM will be held at the offices of Ashurst LLP,
London Fruit & Wool Exchange, 1 Duval Square, London, E1 6PW on
Thursday 13 July 2023 at 11:00. A Notice of AGM, setting out detailed
arrangements, will be sent in advance to all registered holders of
ordinary shares and, where requested, to the beneficial holders of
shares, and will also be available on our website at renewi.com.
Wider stakeholder engagement
The Directors recognise the fundamental importance of promoting
the long-term success of the Company. Clear communication and
proactive engagement to understand the issues and factors that are
most important to stakeholders are fundamental to this.
A summary of our approach to stakeholder engagement and its
consideration in decision-making is set out on pages 121 to 126. Our
Section 172(1) statement is set out on page 102.
Renewi has an active investor relations programme to engage with
institutional investors, analysts, press and other interested parties.
The Company uses multiple channels to do this, including its results
presentations, reports, regulatory news announcements, press
releases, AGM, face-to-face meetings including roadshows, videos,
the corporate website and other social media channels.
During the year, the Remuneration Committee continued to monitor
institutional investors’ and investor bodies’ updated remuneration-
related guidance.
Workforce engagement
Renewi relies on its workforce and its commitment to uphold the
Group’s values, deliver strategic priorities and make the changes
necessary to sustain performance. Engagement with the workforce
is key to ensuring that the Board understands the employee voice.
In addition to the existing channels of communication via the
Group’s Works Council arrangements in the Netherlands and
Belgium, the Board has designated Non-Executive Director Jolande
Sap to assist the Board with workforce reporting.
E Our workforce policies
Renewi operates a Code of Conduct based on our core values,
expected behaviours and key policy principles. This includes creating
a safe and healthy working environment, diversity, equality,
non-discrimination and accountability. Renewi is an equal-
opportunities employer and publishes an annual Modern Slavery
Statement.
DIVISION OF RESPONSIBILITIES
F The role of the Chairman
Ben Verwaayen, our Non-Executive Chairman, is responsible for
leadership of the Board and promoting a culture of openness and
constructive debate. He was and remains independent since his
appointment as Chairman on 1 April 2020.
G Composition of the Board
The Board comprises six Non-Executive Directors, including the
Chairman, and two Executive Directors. The Board’s responsibilities
are set out on page 113 of the Corporate Governance Report and an
overview of the Board roles can be found on page 106 of the
Corporate Governance Report.
The roles of the Board, Board Committees, Chairman and CEO are
documented, as are those matters reserved to the Board. They can
Strategic reportGovernance reportFinancial statementsOther information 118
Corporate Governance Report CONTINUED
be found on our website at renewi.com/en/investors/corporate-
governance. The CEO is responsible to the Board for the
management, development and performance of our business for
those matters for which he has been delegated authority by the
Board. Although the CEO retains full responsibility for the authority
delegated to him by the Board, he has established and chairs the
Executive Committee, which is the vehicle through which he exercises
that authority in respect of our business.
Board to be independent of management and free from any business
or other relationship that could materially interfere with the exercise
of their independent judgement. The Non-Executive Directors make a
significant contribution to the functioning of the Board, thereby
ensuring that no individual or group dominates the decision-making
process. The Chairman also meets and communicates regularly with
the Non-Executive Directors without the presence of the Executive
Directors.
During the year, the Board considered the independence of each
Non-Executive Director for the purposes of the UK Corporate
Governance Code and finds that all the Non-Executive Directors are
independent.
The membership of the Board as at 31 March 2023, and biographical
information about individual Directors, can be found on pages
106 to 107.
H Role of the Non-Executive Directors
The role of the Non-Executive Directors is to provide
constructive challenge and strategic guidance, offer specialist advice
and hold management to account. The Non-Executive Directors bring
a wide range of experience to the Group and are considered by the
Time commitment
Generally, Non-Executive Directors commit 24 days a year to the
Group’s business. In practice, Board members’ time commitments
exceed this minimum expectation when all the work that they
undertake for the Group is considered, particularly in the case of the
Chairman of the Board and the Chairs of the Board Committees. As
well as their work in relation to formal Board and Board Committee
meetings, the Non-Executive Directors also commit time throughout
the year to meetings and conference calls with various levels of
executive management, visits to sites and, for new Non-Executive
Directors, induction sessions.
If a Director is unavoidably absent from a Board or Board Committee
meeting, they receive and review the papers for the meeting and
Director roles and responsibilities
Chairman
• Ben Verwaayen
Responsibility: Responsible for leading
the Board, ensuring its effectiveness in
all aspects of its role and developing the
Group’s culture with the Chief Executive
Officer. Promotes high standards
of integrity and governance across
the Group and ensures effective
communication and understanding
between the Board, management,
shareholders and wider stakeholders.
Senior Independent Non-Executive
Director (SID)
• Allard Castelein
Responsibility: Provides a sounding
board for the Chairman and discusses
concerns that cannot be resolved
through the normal channels or where
such contact would be inappropriate
with shareholders and other
stakeholders. Can be contacted via the
Company Secretary at the UK corporate
head office.
Non-Executive Directors
• Neil Hartley
• Jolande Sap
• Katleen Vandeweyer
• Luc Sterckx
Responsibility: Responsible for
bringing an external perspective, sound
judgement and objectivity to Board
discussion and decision-making, and to
support and constructively challenge the
Executive Directors using their broad
range of experience and expertise.
Chief Financial Officer (CFO)
• Annemieke den Otter
Responsibility: Responsible for the
management of Renewi’s finance,
treasury, strategy, corporate
development and investor relations.
Chief Executive Officer (CEO)
• Otto de Bont
Responsibility: Responsible for the
management of all aspects of Renewi’s
businesses, developing the strategy in
conjunction with the Chairman and the
Board and leading its implementation.
The CEO chairs the Executive Committee,
which is the vehicle through which
the CEO’s authority is exercised. The
Executive Committee meets monthly
and comprises the CEO, CFO, Divisional
Managing Directors and Corporate
Function Leaders.
Company Secretary
• Philip Griffin-Smith
Responsibility: Responsible to the
Chairman for ensuring that all Board and
its Committee meetings are conducted
properly, that Directors receive
appropriate information prior to
meetings to enable them to make
an effective contribution, and that
governance requirements are considered
and implemented. All Directors have
access to the advice of the Company
Secretary. Both the appointment and
removal of the Company Secretary
is a matter for the whole Board.
The roles of the Board, Board Committees, Chairman and CEO are documented in more detail on our website, as are those matters reserved to the Board. They can be found at renewi.com/
en/investors/corporate-governance.
Renewi plcAnnual Report and Accounts 2023 119
Introducing our new
Non-Executive Director
Katleen Vandeweyer joined as a Non-Executive Director
and Chair of the Audit Committee on 1 December 2022.
What attracted you to Renewi?
I am highly motivated to contribute to Renewi’s purpose to
protect our planet by giving new life to used materials. I am
deeply concerned by the climate crisis. I am very aware that
if we don’t do anything right now, the temperature will rise
by more than 1.5 degrees by the end of this century. Renewi
is at the heart of the circular economy. Furthermore, I am
attracted to Renewi as it is a company where sustainability
and business results go hand in hand and even reinforce
each other.
What qualities do you believe you can bring
to the Board?
I believe I can bring a unique mix of CFO experience in a
listed company with extensive board experience in several
large, international, listed companies. As such, I can bring
relevant audit and accounting experience appropriate to
chairing the audit committee of a listed company.
Furthermore, I have a lot of experience in capital intensive
industries, such as the Telecom sector.
How would you describe your style as
a Non-Executive Director?
Depending on the context, I am a challenger as well as a
supporter. I am a strong consensus builder and an articulated
communicator. I value good listening, sound judgement and
creativity. I am passionate about business as well.
What do you think our key stakeholders, investors
and customers expect from the Board?
I think that our key stakeholders expect the Board to
strengthen Renewi’s vision to be a leading waste-to-product
company with a strong focus on waste collection, sorting,
processing and the circular economy. Furthermore, our key
stakeholders expect us to execute our strategy to be the
leading waste-to-product company in the world’s most
advanced circular economies, to be the leader in secondary
material production and to selectively gain market share. I
also believe that our key stakeholders expect the Board to be
highly engaged with Renewi’s commitment to sustainability
and to being at the heart of the circular economy. The Board
members all share a deep belief that the company can
improve the lives of its employees, customers, shareholders,
and stakeholders and society at large.
typically provide verbal or written input ahead of the meeting,
usually through the Chairman of the Board or the Chair of the
relevant Board Committee, so that their views are made known
and considered at the meeting.
Given the nature of the business to be conducted, some Board
meetings are convened at short notice, which can make it difficult
for some Directors to attend due to prior commitments.
Subject to specific Board approval, Executive Directors and other
Executive Committee members may accept external appointments
as non-executive directors of other companies, and retain any
related fees paid to them, provided that such appointments are
not considered by the Board to prevent or reduce the ability
of the executive to perform his or her role within the Group
to the required standard.
Senior Independent Director
Allard Castelein, who joined the Board as a Non-Executive Director in
January 2017, was appointed Senior Independent Director with effect
from 1 September 2019. The role of the Senior Independent Director
is to serve as a sounding board for the Chairman and as an
intermediary for the other Directors when necessary. The Senior
Independent Director will be available to shareholders should
they have concerns that contact through the normal channels
of Chairman, Chief Executive Officer or Chief Financial Officer
has failed to resolve, or where such contact is inappropriate.
I The Company Secretary
The Company Secretary is responsible to the Chairman for
ensuring that all Board and Board Committee meetings are properly
conducted, that the Directors receive appropriate information prior
to meetings to enable them to make an effective contribution, and
that governance requirements are considered and implemented.
Both the appointment and removal of the Company Secretary
is a matter for the whole Board.
COMPOSITION, SUCCESSION AND EVALUATION
J Appointments to the Board and succession planning
The Nomination Committee regularly reviews the composition
of the Board and the status of succession for both senior executive
management and Board-level positions. Directors have regular
contact with and access to succession candidates for senior
executive management positions.
The Nomination Committee’s role is to recommend to the Board any
new Board appointments and to consider, more broadly, succession
plans for both senior executive management and Board-level
positions. As part of its consideration, the Nomination Committee
evaluates the balance of skills, knowledge, experience and diversity
of the Board. Any decisions relating to the appointment of Directors
are made by the entire Board based on the merits of the candidates
and the relevance of their background and experience, measured
against objective criteria, with care taken to ensure that appointees
have enough time to devote to our business.
During the year, the Nomination Committee worked with
independent search consultants to fill two Board vacancies. Toby
Woolrych, Chief Financial Officer, stepped down from the Board on
31 March 2022, and this vacancy was filled by the appointment of
Annemieke den Otter on 1 June 2022. Marina Wyatt, Non-Executive
Director and Chair of the Audit Committee stepped down from the
Board at the conclusion of the 2022 AGM, and was succeeded by
Katleen Vandeweyer, who joined the Board on 1 December 2022.
Strategic reportGovernance reportFinancial statementsOther information 120
Corporate Governance Report CONTINUED
For more information, please see the Nomination Committee Report
from page 137.
controls reports from internal audit, as well as the external auditor
on matters identified in the course of its statutory audit work.
Re-election of Directors
In accordance with Article 94 of the Articles, all Directors retire at
each AGM and may offer themselves for re-election by shareholders.
Accordingly, all the Directors will retire at the AGM in July 2023. The
Notice of AGM will contain details of all Directors seeking election
and re-election.
For more information, see the Other disclosures from page 158.
K Skills, experience and knowledge of the Board
As part of its role, the Nomination Committee is responsible
for reviewing the composition of the Board, to ensure that it has
the appropriate expertise while also recognising the importance
of diversity.
L Board evaluation
In FY23 the Board evaluation was carried out through an
externally facilitated structured online survey. The findings are
set out in the Nomination Committee Report on page 139.
AUDIT, RISK AND INTERNAL CONTROL
M Internal and external audit
The Audit Committee reviews the Company’s relationship with
its external auditors, BDO LLP, including the independence of the
external auditors. BDO LLP was first appointed to conduct the audit
of the Company’s and Group’s consolidated financial statements
for the financial year ended 31 March 2021 and will be put forward
for re-appointment at the 2023 AGM.
The Committee maintains a policy for the pre-approval of all
permitted non-audit services undertaken by the external auditor. The
principal purpose is to ensure that the independence of the auditor
is maintained. The Audit Committee also reviews the independence
and effectiveness of the internal audit function.
The system of controls is designed to manage, rather than eliminate,
the risk of failure to achieve business objectives and can only provide
reasonable (not necessarily absolute) assurance of effective
operation and compliance with laws and regulations.
The Directors believe that the Group maintains an effective,
embedded system of internal controls and complies with the FRC’s
guidance entitled Guidance on Risk Management, Internal Control
and Related Financial and Business Reporting.
For more information about the ways in which Renewi manages
business risks, procedures for identifying emerging risks,
descriptions of principal risks and uncertainties, and the Viability
Statement, see the Risk Management section from page 86.
REMUNERATION
P Policies and practices
The Remuneration Committee is responsible for determining,
approving and reviewing the Company’s remuneration principles
and frameworks, to ensure they support the strategy of the Company
and are designed to promote long-term success.
For more information on the Remuneration Committee’s work during
FY23, see the Directors’ Remuneration Report from page 140.
Q Procedure for developing remuneration policy
During FY23, the Remuneration Committee reviewed the
Directors’ Remuneration Policy to ensure it continues to align with
corporate governance best practice, support the Company’s ability to
recruit and retain executive talent to deliver against its strategy, and
promote the delivery of the long-term strategy. As part of the process
for developing the Director’s Remuneration Policy, a consultation of
major institutional shareholders was undertaken during the year.
Details of this engagement are set out in the Directors’ Remuneration
Report from page 140.
For more information, see the Audit Committee Report on pages
132 to 136.
The Directors’ Remuneration Policy, which is to be put to
shareholders for approval at the 2023 AGM, can be found from
page 143.
N Fair, balanced and understandable assessment
The Board as a whole is responsible for the Company’s financial
and business reporting including reviewing the Company’s financial
results announcements.
The Board considers this Annual Report, taken as a whole, to be fair,
balanced and understandable, and provides the information
necessary for shareholders to assess Renewi’s position, performance,
business model and strategy.
R Exercising independent judgement
The Remuneration Committee exercises independent judgement
when determining remuneration outcomes. The Committee takes into
account factors such as wider business and individual performance
during the year, including health and safety performance and
environmental, social and governance objectives.
For more information on FY23 performance, decisions and reward
outcomes, see the Directors’ Remuneration Report from page 140.
O Risk management and internal controls
The Board has overall responsibility for our system of internal
controls and risk management policies, and has an ongoing
responsibility for reviewing their effectiveness. During FY23, the
Directors continued to review the effectiveness of our system of
controls, risk management (including a robust assessment of the
emerging and principal risks, including those that would affect the
business model, future performance, solvency or liquidity) and
high-level internal control processes. These reviews included an
assessment of internal, financial, operational and compliance
controls, risk management, and their effectiveness. These were
supported by management assurance of the maintenance of
Renewi plcAnnual Report and Accounts 2023 121
Connecting with our stakeholders
RENEWI’S APPROACH TO
STAKEHOLDER ENGAGEMENT
Considering the interests of our stakeholders
is fundamental to the way we operate.
Our values and Code of Conduct empower
employees to make the best decisions
in the interests of the Group and our
stakeholders, helping to ensure these
considerations are made not only at Board
level but throughout our organisation.
The diagram below illustrates our approach
to stakeholder engagement.
1. Engagement
Understanding stakeholder objectives,
needs, interests and concerns.
4. Measurement
Measuring performance
of stakeholder relationships.
2. Consideration
Considering alignment of stakeholder
needs, interests, concerns and objectives
with Renewi’s purpose, values, business
model and strategic objectives.
Understanding risks and opportunities.
3. Decision-making
Balancing the needs of different stakeholders.
5. Outcomes
A virtuous circle of shared outcomes:
shared rewards, alignment of interests,
strong relationships, long-term value
creation, competitiveness, reputation,
investment attraction, innovation and
achievement of purpose.
5 . Outcomes
Shared
rewards
Alignment
of interests
M easurement
4 .
D e c ision-making
3 .
C o nsideration
2 .
. E n g agement
1
Achievement
of purpose
Innovation
Stakeholder
Governance
Strong
relationships
Long-term
value creation
Investment attraction
Competitiveness
Reputation
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Corporate Governance Report CONTINUED
Our key stakeholders
OUR WASTE-PRODUCING CUSTOMERS
Relevance to business model
By understanding the needs and concerns
of our waste-producing customers, we can
innovate and find better solutions to manage
their waste, improve the valorisation of waste
and increase qualities and quantities of the
secondary materials produced. This in turn
leads to greater revenues and healthier
margins and enables us to adapt to and
invest in changing market trends, so we can
be a leader in recycling. We deliver value
to our customers by collaborating and
addressing the key issues.
How we engage
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• MyRenewi digital portal and customer
call centres
• Regular engagement through daily
interactions, knowledge-sharing sessions
and reports on sustainability performance
• Being part of coalitions that contribute
to sustainability and circularity
• Sustainability and separation advice,
education and training programmes
• Customer events
Swill collection containers, Commercial
Waste NL, Organics, Amsterdam
Key issues discussed
• Commercial terms of engagement
and services provided
• Quality of service – on time, every time,
and responsiveness and flexibility
• Responsible management of waste
• Market developments and requirements
of legislation and regulations
• How to deliver quality waste streams/
ensure the workforce is aligned behind
better sorting
• How to support the circular economy
Measurement
• Customer questionnaires and surveys
• Net promoter scores
• Churn rates and win rates
• Customer complaints
• Adoption rates of MyRenewi
Outcomes of engagement
• Customer service that retains our
customers and meets their needs
• Support and advice for customers over
waste segregation and separate collections,
enabling greater valorisation of waste
• Communication of market changes such as
recyclate pricing and other general inflation
factors driven, for example, by the invasion
of Ukraine
• Mission75 target to increase the recycling
rate from 65% to 75%
• Renewi 2.0, an improvement programme
launched in FY21 to harmonise business
processes and improve customer and
employee experiences
HOW OUR BOARD UNDERSTANDS
THE INTERESTS OF OUR
STAKEHOLDERS
Over FY23, the Board received updates on
various engagement initiatives designed to
promote recycling and an understanding of
sustainability goals among stakeholders.
This gave Directors a grasp
of the various initiatives that the Group
leads and the relationship between it
and its stakeholders.
Over the course of the year, Directors
engaged with various stakeholders to
understand the issues that concern and
impact them most. The CEO and CFO also
met with investors throughout the year
to gauge their views on a range of issues.
The Board continues to review its
engagement processes to ensure they
best understand how the Company’s
interests align with those of the
Company’s stakeholders.
See Principal Decisions on page 127.
HOW OUR BOARD CONSIDERS
STAKEHOLDERS’ INTERESTS
IN DECISION-MAKING
Throughout the year, Directors recognised
their responsibility to act in good faith
to promote the success of the Company
for the benefit of shareholders, while also
considering the impact of their decisions
on wider stakeholders and other factors
relevant to the decisions being made. Clear
communication and proactive engagement
to understand the issues and factors that
are most important to stakeholders
is fundamental to this.
The Board acknowledges that every
decision made will not necessarily result
in a positive outcome for all stakeholders.
By considering our purpose and values,
together with our strategic priorities, the
Board aims to ensure the decisions made
are consistent and intended to promote
the Company’s long-term success.
Renewi plcAnnual Report and Accounts 2023 123
OUR PRODUCT CUSTOMERS
OUR INNOVATION PARTNERS
OUR SUPPLIERS
Relevance to business model
By understanding the needs and concerns
of our product customers, we can innovate
and improve the valorisation of waste,
producing superior quality secondary
products, demanding higher prices and, in
turn, increasing revenues and margins. It also
allows us to adapt to changing market trends,
so we can be a leader in recycling. We deliver
value to our customers by collaborating and
addressing the key issues.
How we engage
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Regular strategic and operational
engagements
• Customer meetings with the engineering
team to collaborate/conceptualise
new solutions
• Marketing collateral, including factsheets
• Industry and customer events
• Questionnaires and satisfaction surveys
Key issues discussed
• Certainty of supply – timeliness and
sufficient volumes
• Technical feasibility and potential
commercialisation
• Delivery of higher-quality recyclate product
to meet increased volumes required
by customers
• Innovative solutions
• Requirements following changes
in legislation and regulations
• Market developments
Measurement
• Recycling rate and secondary
materials production
• Innovation funnel and investments spend
• Partnerships and collaborations agreed
• Questionnaires and surveys
• Net promoter scores
Outcomes of engagement
• Customer service that retains our
customers and meets their needs
• We are investing in further refinement
of waste in order to produce higher
specification recyclates and
secondary materials
• Participation in setting industry standards
• Renewi has collaborated alongside
innovation partner Nordsol
and end customer Shell to build the first
commercial bio-LNG plant in Europe
Relevance to business model
It is strategically important for Renewi
to innovate and improve the valorisation
of waste, increasing the volume and quality
of the secondary materials we produce.
By extracting more value from waste, Renewi
will increase revenues and margins, as well
as market share.
How we engage
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Regular meetings with potential partners
and manufacturers to explore and develop
new product possibilities
• Work alongside network organisations
that provide a platform to meet potential
partners and to screen the innovation
potential of ideas/co-operation opportunities
Key issues discussed
• How to scale innovations to impact
business. This may include construction of
a facility or co-investing in a circular partner
• Market expectations on use of secondary
materials and potential of recycled content
• Opportunity of waste-to-product
processes, improving the viability
of circular developments
Measurement
• Capital investment in innovation
• The number of projects within our
innovation pipeline at the concept stage
and beyond
Outcomes of engagement
• Renewi has a comprehensive innovation
pipeline delivering incremental waste
processing and enabling recycling where
this previously wasn’t possible
• The Board has committed capital to bring
new innovations to the market, including
plastics sorting and a collaboration
alongside innovation partner Nordsol and
end customer Shell to build the first
commercial bio-LNG plant in Europe
Relevance to business model
Working with a trusted group of suppliers is
key to creating a reliable and effective supply
chain. Managing the inflation pressures from
the supply chain and therefore the cost base
of the Group is essential to financial
outcomes. Reliability and ethics are key
to upholding our reputation and helps us
win market share. Increasing efficiency of
interactions with suppliers through Renewi
2.0 and the implementation of a procurement
system supports long-term relationships and
administrative savings.
How we engage
• With our procurement team to ensure
transparency and engagement
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Initial formal market tender
• Definition of processes to support suppliers
to become embedded in our source-to-pay
system and procurement digital platform
• Listening sessions to identify and address
supplier concerns
• Annual audit to ensure compliance
Key issues discussed
• Adding value by introducing new
sustainable technical innovations
• Responsible sourcing
• Enhanced safety of our products
• Improvements on operational processes
e.g. our source-to-pay system
• Mitigating risks on quality and take
advantage of market developments
Measurement
• Real-time supplier data
• Divisional payment practices data
• Supplier reporting and audit reviews
Outcomes of engagement
• Long-term relationships with trusted
suppliers to enable efficient and
sustainable purchase decisions
• Focus on safety and high ethical standards
• Collaboration over mutual concerns,
e.g. to understand market disruptions
caused by the war in Ukraine and
inflationary pressures
• Collaboration over technical innovations
• Investment in digital platforms, more
efficient processing and development
of preferred suppliers
Strategic reportGovernance reportFinancial statementsOther information 124
Corporate Governance Report CONTINUED
OUR EMPLOYEES
Relevance to business model
Our employees are a significant source
of value that drives our performance and
productivity and enables us to be a leader
in recycling. We retain and attract the best
employees by creating a great working
experience. Innovation is one of our value
drivers and helps us utilise the latest methods
of secondary material production and satisfy
the evolving needs of our customers. To foster
innovation, we are co-creating with our
employees a culture that is diverse
and inclusive.
How we engage
• The Board’s workforce engagement
representative, Non-Executive Director
Jolande Sap
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Group-wide employee surveys (Pulse
survey) and leader-led feedback
• Performance and development reviews
• Monthly Group-wide leadership and
management team meetings
• Employee relations through Works Councils
in Belgium and the Netherlands
• Toolbox training and safety stand-downs
for non-desk workers
• Lifesaving rules and safety reporting
for all employees
• Divisional and business newsletters, and
news on screens, noticeboards
and intranet
• Opening growth pathways through
leadership training
Key issues discussed
• We constantly discuss an exhaustive range
of topics with our employees on a daily
basis covering every aspect of working
at Renewi and Renewi operations
• Identification of key risk areas locally,
divisionally and at business level through
incident and near miss reporting and
listening
Measurement
• Pulse surveys
• Safety data and HIT reporting
• Diversity data
• Performance and Development Review
(PDR) assessment of performance and
Company values
• Employee turnover and
applications received
• Talent reviews
Outcomes of engagement
• A motivated and aligned workforce
• Retain and attract the best employees.
See employee engagement KPI on page 13
• A positive safety culture. See Lost Time
Incidents (LTI) KPI on page 131
• Creating diverse and inclusive teams
• Talent development. Identification
of young high potentials across our
divisions who have the potential to fulfil
a leadership role
• Improved employee experiences through
digitisation of the business, including
through Renewi 2.0
• To find out more about employee
outcomes see the Care for People section
on page 66
LOCAL COMMUNITIES
Relevance to business model
We maintain long-term relationships with
our local communities that uphold our
reputation. This is essential as we grow our
operations and become a leader in recycling.
The processing of waste is critical for
communities to continue to operate.
However, our purpose adds greater value,
increasing the production of secondary
material from waste, avoiding the disposal
of waste through incineration or landfill, and
enabling local and global communities to
meet their sustainability ambitions.
How we engage
• Continuous dialogue with our neighbours
and local legislators
• Community events, open days
and education events
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Meetings with special interest groups
• Leafleting and social media
Key issues discussed
• How we manage the environmental impact
of our activities
• The benefits of recycling and secondary
material production
• How we reduce the impact of climate
change through recycling
• Ways to deliver essential services with
minimal impact to the local environment
Measurement
• Community engagement projects data
• Carbon emissions and recycling data
• Complaints data
Outcomes of engagement
• Renewi’s contribution to
community projects
• The local community contribution to our
overall carbon emissions and recycling
rates. See carbon emissions and recycling
KPIs on page 13 and the Sustainability
Review (published June 2023)
• Where there is an adverse event,
we actively engage with
community stakeholders
• Renewi works with communities and
local authorities on different initiatives
throughout the year, e.g. disposal of
batteries. We also visit schools to discuss
recycling and what happens to waste
Financial Shared
Services Centre,
Lommel
Renewi plcAnnual Report and Accounts 2023 GOVERNMENT
Relevance to business model
There has been an increasing shift by
governments towards a sustainable future,
with new targets agreed such as at the UN’s
recent COP summits and the European
Union’s Fit for 55 plans to reduce greenhouse
gas emissions. The impact of the climate
emergency has further led to unprecedented
changes within markets, presenting an
opportunity for Renewi to meet growing and
new demands for secondary materials, whilst
also helping governments meet their
sustainability targets.
How we engage
• Board- and Executive Committee-level
engagement over political and
regulatory matters
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Face-to-face engagement with the state
secretary, politicians and other local, regional
and national government officials
• Lobbying on recycling, secondary materials
usage and climate transition
• Engaging directly or through trade and
industry associations and lobby groups
• Media coverage
Board members Jolande Sap,
Non-Executive Director, and
Annemieke den Otter,
Chief Financial Officer
Key issues discussed
• Ways to shape the legislation to deliver on
climate change and the circular economy
• How the industry can play its part in
helping to meet climate change targets
(including CO2 reduction, energy transition
and creating secondary raw materials
to lower CO2 emissions)
• Regulatory compliance
• Use of fiscal and monetary incentives and
regulation to encourage desired outcomes
• Responses to the Ukraine war, cost-of-living
challenges, sustainability and climate risk
Measurement
• General contact with government
representatives
Outcomes of engagement
• Understanding of the risks and opportunities
within the waste-to-product sector
• An ongoing dialogue with governments
enables us to work together to deliver on
climate change and the circular economy.
We support progressive legislation in the
creation of a circular economy, reduction in
incineration and stimulation of demand for
secondary materials
• Renewi’s contribution to overall carbon
emissions and recycling rates. See carbon
emissions and recycling KPIs on page 13
and the Sustainability Review (published
June 2023)
125
REGULATORS
Relevance to business model
Increasingly, regulation is being introduced
to encourage recycling and re-use, demand
secondary materials use, develop low-
emissions cities, foster responsible
production and encourage circularity
throughout the economy. As a waste-to-
product company, this presents a great
opportunity for Renewi, but also means we
need to ensure our operations remain
compliant in a continuously changing
regulatory landscape.
How we engage
• Board- and Executive Committee-level
engagement over political and
regulatory matters
• CEO reports to the Board
• Virtual meetings, site inspections, testing
and data submissions
• Participate in investigations
• Through trade and industry associations
• Join community advisory panels
Key issues discussed
• EC-wide harmonisation and permitted
national differences
Enforcement policy
•
• Operational compliance with permits
• Meeting permitted
environmental standards
• Quality requirements – best ways
to measure
• Defining evolving standards and addressing
topical concerns
• Applications of best practices and best
available techniques
• Responding to compliance
breaches appropriately
Measurement
• Operational permit management data
• Safety data and HIT reporting
• International Sustainability Rating System
framework (ISRS)
Outcomes of engagement
• Operational compliance with permits,
quality standards and meeting high
environmental standards
• Application of best practices and
responsiveness to any investigations
or compliance concerns raised
• Continuous improvements generated from
introduction of the ISRS framework
• A positive safety culture. Lost Time Injury
Frequency Rate on page 131
Strategic reportGovernance reportFinancial statementsOther information 126
Corporate Governance Report CONTINUED
SHAREHOLDERS
LENDERS
GLOBAL COMMUNITY
Relevance to business model
We use the capital from debt investors and
banks to execute our business model.
Increasingly, lenders want to understand
our approach to sustainability so they can
satisfy their own compliance obligations.
How we engage
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Meetings with CEO, CFO and
Group Treasury
• Regular financial reporting and covenant
compliance reporting documents
• Close contact regarding the ongoing
performance of the Group
Relevance to business model
The climate emergency is a major concern
throughout the world. Our children,
grandchildren and generations to come
will face the consequences of inaction today.
Renewi’s business model helps address
the climate emergency.
Society is a driver for the changes required
to achieve true circularity, placing pressure
on governments, influencing policies,
creating new markets and demanding greater
ESG credentials from the products and
services they purchase.
How we engage
• Contribution to ongoing debate around
climate change
• Discussions regarding the ongoing facilities
• Influencing communication channels such
and utilisation
as press and social media
• Consultation regarding alternative financial
products available
• Regularly sharing insights
Key issues discussed
• Our approach to sustainability
• Ways to optimise debt facilities, including
new issuance and upcoming maturities
• Market changes, including Brexit
and benchmark rate reforms
• Financial market insights
• Experiences and expectations for the
local economies
• How we can optimise liquidity, cash
management and other treasury activities
Measurement
• Financial performance data. See Financial
KPIs on page 12
• Sustainability performance data. See
carbon emissions and recycling KPIs
on page 13 and the Sustainability Review
Outcomes of engagement
• Lenders understand our capital
requirements, financial performance
and sustainability performance
• Continued access to the lending markets,
including the recent incremental issuances
and securing of EIB loan, see Principal
Decisions on page 127
Key issues discussed
• How we can address the climate
emergency
• Ways to deliver essential services with
minimal impact to the environment
Measurement
• Carbon emissions and recycling data.
See carbon emissions and recycling KPIs
on page 13
• TCFD reporting on pages 59 to 65
Outcomes of engagement
• Greater expectations of society have placed
pressure on governments and regulators
to introduce legislation that supports our
business model
• Greater expectations of society have placed
pressure on companies to produce
products that can be recycled, leading
to greater valorisation of waste
• A culture of recycling has led to a change
in behaviour of society, such as greater
discipline to sort waste for collection,
leading to greater valorisation of waste
Relevance to business model
We use the capital from equity investors to
execute our business model. Surging demand
for sustainable and green investments has
made Renewi’s purpose and business model
more appealing for investors, presenting an
opportunity for Renewi to attract capital.
Increasingly, the way companies approach
Environmental, Social and Governance (ESG)
is a key topic for investor stewardship and
a major influence in investment decisions.
How we engage
• Meetings with the CEO, CFO and
investor relations
• CEO reports to the Board
• Meetings with members of the
Executive Committee
• Capital Markets events and site visits
• Roadshows, video conference and
telephone calls and other meetings
• Regular trading updates on
regulatory platforms
• Education of investors on the investment
case through informed sell side equity
research, sales and corporate access teams
• Annual and interim results presentations
• Annual Reports and Sustainability Reports
and the AGM
Key issues discussed
• Progress of the three strategic value drivers:
Mineralz & Water, Renewi 2.0 and Circular
innovations
• Responses to inflation and
customer pricing
• Progression of the circular economy
and the market in which we operate
• Our strategy to increase the performance
of the Group
• Our approach to sustainability and
climate risk
Measurement
• Financial performance
• Sustainability performance; C-score rating
by CDP for Renewi’s transparency on
climate change
• Changes in investor shareholdings
• Share price
Outcomes of engagement
• New investors joining the register and
increasing their shareholdings.
• Investors better understand the investment
case, the financial and non-financial
performance of the business and the likely
future trajectory of the business
performance based on the outlook.
• We are fostering an understanding of the
market-wide tailwinds that are supporting
our market positioning and strategy
Renewi plcAnnual Report and Accounts 2023 127
Principal decisions in FY23
Renewi defines principal decisions as decisions and discussions
that are material or strategic to the Group, and also those that are
significant to any of our stakeholder groups. The following items
are considered to be examples of principal decisions made by the
Board during FY23.
THE ACQUISITION OF RENEWI WESTPOORT
Context
During the year the Board approved the acquisition of GMP
Exploitatie BV (‘Paro’), an Amsterdam-based commercial waste
and recycling business. The acquisition is consistent with the
Group’s strategy to grow market share and its ambition to be the
leading waste-to-product company in Europe’s most advanced
circular economies. With a recycling rate of around 78%, Paro,
renamed Westpoort, will contribute towards Renewi’s objective
to achieve a Group-wide 75% recycling rate by 2025, and will
deliver synergies from site rationalisation, route and waste flow
optimisation and other operational benefits as part of the Group’s
Commercial Division.
Stakeholder considerations
• Product customers. Existing and acquired customers will benefit
from location and capacity made available, as well as wider
product offering, focus on sustainability and operational capability
• Government/regulators. Increasing the recycling capabilities
through synergies from site rationalisation will help to meet policy
ambitions to address climate change via the realisation of
a circular economy
• Innovation partners. For existing partners and their investors, the
acquisition by Renewi provides them with a more material and
capable long-term partner for their proposed biomethanol facility
• Global community. The acquisition will help to protect the
planet, reduce carbon emissions and preserve natural resources
through synergies, route and waste flow optimisation and other
operational benefits, thus increasing recycling rates and reducing
incinerated waste
purpose and strategy. The Board approved a loan agreement of €40m
with the European Investment Bank (EIB), as part of a €100m funding
facility, to invest in three key projects. The EIB mandate requires funds
to be deployed into valuable infrastructure that directly addresses
European Union climate change policies, such as these projects. The
first project, in Flanders, Belgium, is the construction of three new
high-tech sorting lines for residual, commercial and industrial waste,
allowing more materials to be recovered and recycled. The second, in
Acht in the Netherlands, is the construction of a new rigid plastics
sorting facility that will produce high-quality secondary plastics. The
third is an upgrade of one of Renewi’s existing anaerobic digestion
plants in the Netherlands, in which microorganisms break down
biodegradable material to create biogas.
Stakeholder considerations
• Product customers. Increased valorisation of waste can lead to
superior secondary products for customers, creating new markets
and providing secondary alternatives to virgin inputs
• Government/regulators. Increasing the recycling rate is essential
to meet policy ambitions to address climate change via the
realisation of a circular economy. Furthermore, the investment
in product sorting in Belgium will help to achieve the heightened
recycling standards introduced by the VLAREMA 8 regulation
• Innovation partners. Renewi embraces collaboration with its
innovation partners, universities and commercial operators to bring
new ideas to life. It is important that Renewi finds new ways of
creating new products to satisfy the growing demand for secondary
materials
• Global community. To protect the planet we must reduce carbon
emissions and preserve natural resources, both of which are
supported by increased recycling rates. These projects will allow
significantly more high-quality secondary raw materials to be
extracted, helping to reduce carbon emissions. Furthermore, the
creation of biogas from out-of-date food waste will play a role in
addressing the energy and climate crisis and help to reduce the
dependence on fossil fuels
• Investors. Creating more value from the waste we process will
increase shareholder value
• Investors. The acquisition is expected to increase shareholder
• Waste-producing customers. Renewi can better meet the needs of
value through higher-quality secondary materials and synergies
from site rationalisation
its customers by finding new methods of recycling that enable
customers to deliver on their own sustainability ambitions
• Waste-producing customers. Renewi can better meet the needs
of its customers by improving recycling rates and reducing
incinerated waste, and ensure fit-for-the-future waste collection,
sorting and recycling
Strategic actions supported by the Board
The acquisition is a strong strategic fit with Renewi’s strategy to grow
market share and strengthen our position as a leading waste-to-
product company in Europe’s most advanced circular economies.
Outcomes
• With a recycling rate of around 78%, the acquired business will
contribute towards Renewi’s objective to achieve a Group-wide
75% recycling rate by 2025. To find out more see page 75
• Site rationalisation and integration are now under way to
synergise, including route and waste flow optimisation and other
operational benefits as part of the Group’s Commercial Division. To
find out more see page 75
EIB FUNDING FACILITY
Context
Investment in innovation to improve the quality of recyclates and
reduce the levels of incinerated waste is at the heart of Renewi’s
Strategic actions supported by the Board
The Board has set an ambitious Mission75 target. Investment into
these projects will allow significantly more high-quality secondary
raw materials to be extracted, and the new equipment installed at
Renewi’s biogas plant will displace fossil fuels, reducing emissions
and avoiding the use of further virgin resources. Investing in
innovation is one of the Board’s priorities as the Company works
to deliver the first two pillars of the growth strategy with a target
of achieving an additional EBIT of €20m by FY26.
Outcomes
• The new equipment installed at Renewi’s biogas plant will allow
60% of the biogas to be converted into biomethane, which can
be injected into existing national gas grids, while the other 40% will
be channelled to an existing bio-LNG facility. To find out more
see page 53
• The construction of a new rigid plastics sorting facility in Acht, the
Netherlands, will produce high-quality secondary plastics. To find
out more see page 42
• Investments will help to address the legislation in Flanders,
VLAREMA 8. Our advanced sorting will increase the recycling and
reduce waste going to incineration. To find out more see page 77
Strategic reportGovernance reportFinancial statementsOther information employer. The results and analysis of Pulse surveys are presented
to the Board to allow it to monitor any changes in attitudes as well
as question Divisional Managing Directors and Function Leaders. For
more information about Pulse surveys, see the Care for People
section on pages 66 to 71.
128
Corporate Governance Report CONTINUED
ENGAGING WITH OUR WORKFORCE
Renewi is committed to being a great place to work. Engagement
with employees is an important element in fostering a positive
environment in which all employees are respected, openness is
valued, diversity celebrated and every voice heard. The Company
recognises and values people as an important asset in achieving
goals, upholding values and delivering strategic priorities.
In 2019, in response to the provision in the 2018 UK Corporate
Governance Code prescribing certain methods that the Board could
use to engage with the workforce, the Board designated Non-
Executive Director Jolande Sap to assist the Board with workforce
engagement. Jolande, a former leader of the Dutch Green Party,
GroenLinks, is experienced in understanding social-economic issues
and is believed by the Board to have the relevant skills required. Over
the course of the year Jolande has been involved in a number of
workforce engagement activities:
• Participated in the Article 24 meeting in June 2022, a general
consultation meeting between management and the Dutch Works
Council to discuss Renewi’s operations
• Held four meetings with the Chair of the Dutch Works Council to
discuss workforce related topics including employee engagement,
diversity and inclusion, leadership, the ongoing impact of Covid-19,
the Ukraine war and inflationary and cost-of-living challenges
• Appointed as the Dutch Works Council’s representative on the
Supervisory Board of Renewi Netherlands Holdings BV
In addition to direct engagement with the workforce, the Board is
able to receive updates from the Diversity and Inclusion Board and
Group HR Director to understand the workforce’s views on a wide
variety of topics. The Board also receives a number of company-wide
reports providing insight into the views of the entire workforce,
regardless of location and role, allowing for a breadth of views
to be understood when making key decisions.
Case study:
Conscious of the effect and impact of rising costs and inflation on
employees caused by the socio-economic situation that emerged in
the second half of the year, the Board tasked management with
devising a proposal to offer some additional support for those
employees falling below the threshold grade for those participating
in the Renewi annual Bonus scheme. As a result, some 5,000
permanent and temporary employees received a one-off gross
payment of €250 at Christmas 2022. Employees in all countries
of Renewi’s operations were in scope for this award apart from
Belgium, this solely being due to the fact that social partners and
relevant governmental authorities there were in the process of
negotiating a mandatory one-off premium for employees for similar
cost-of-living purposes.
Investing in and rewarding our workforce
Although the Remuneration Committee does not consult directly
with employees, the Committee considers general basic salary
increases for our workforce, aiming to ensure the global total reward
offering is competitive, compelling and aligned to our business
performance, while supporting a culture where everyone feels
valued and included. For more information see the Remuneration
Report on page 140.
Employee Pulse surveys
Renewi conducts regular Pulse surveys to understand the mood
of employees and their attitude towards Renewi as an employer.
The data analysis includes the calculation of a net promoter score
estimating the likelihood of staff to recommend Renewi as an
Renewi plcAnnual Report and Accounts 2023 129
Customer Care
Amersfoort
Strategic reportGovernance reportFinancial statementsOther information 130
Safety, Health and
Environment
Committee Report
On behalf of the Board, I am pleased to present the
Safety, Health and Environment Committee Report
for the year ended 31 March 2023.
LUC STERCKX
Chair of the SHE Committee
COMMITTEE MEMBERSHIP AND
FY23 COMMITTEE MEETING ATTENDANCE
Luc Sterckx (Chair)
Allard Castelein
Neil Hartley
4 (4)
3 (4)
4 (4)
Bracketed figures indicate maximum potential attendance of each Director.
ROLE OF THE COMMITTEE
• Review and recommend appropriate policies related to
the protection of the environment, together with the
safety of employees, contractors, customers and the
public, and oversee the monitoring and enforcement of
these policies and related practices and procedures
• Review significant risks or exposures and assess the steps
management has taken to minimise those risks
• Assist in keeping Directors informed of their safety, health
and environmental responsibilities and duties as
necessary and relevant
• Monitor regulatory changes in relation to safety, health
and environmental matters and the impact such changes
may have on the business of Renewi
• Receive reports as to divisional safety and health and
environmental policies and arrangements, compliance
with and any proposed changes to those policies and
arrangements
• Receive reports as to safety, health and environmental
performance and any major incidents to ensure that
management identifies and implements any corrective
action considered appropriate to achieve compliance and
raise performance where required
For terms of reference go to renewi.com/sheco
Given the high priority given by the Company to safety, health and
environmental performance, the SHE (Safety, Health and
Environment) Committee has continued its role to stimulate and
orient the actions and policies relating to the further improvement of
this priority.
The Committee met four times during the year. By invitation, the
meetings were regularly attended by the Chief Executive Officer, the
Group SHEQ Director and Divisional Managing Directors.
During the year the Committee intensified its contacts in the
operations field in general and with the employees of Group SHEQ
and divisional SHEQ Directors in particular.
Work on adopting the International Sustainability Rating System
(ISRS) continued through the year – it is considered the structural
backbone for a lasting and continued safety improvement. Safety
awareness and operational standards are improving, however there
is not yet a downward trend in non-compliance incidents compared
to the previous year.
SHE corporate governance framework
Renewi plc Board
SHE Committee
Executive
Committee
Safety and Compliance
Taskforce*
SHEQ Leads**
*The Safety and Compliance Taskforce meet monthly to review performance
and progress against the SHEQ Strategy Plan. Membership includes Divisional
MDs, the CEO and the Group SHEQ Director, and divisional SHEQ Directors.
The Safety and Compliance Taskforce is focused on accountability and ensuring
the execution of the SHEQ Strategy Plan.
**The team of SHEQ Leads comprises the Group SHEQ Director, divisional SHEQ
Directors and the Group SHEQ team.
Renewi plcAnnual Report and Accounts 2023 131
Additionally, significant steps forward have been taken in
the structuring and follow through of our environmental
performance, allowing identification and prioritisation of
improvement opportunities.
Looking ahead, the SHE Committee will be overseeing the
improvements to vehicle safety equipment and continuing to
monitor the rollout of ISRS, including Life Saving Critical standards
and Safety Leadership, which are on track for FY24.
SAFETY, HEALTH AND ENVIRONMENT PERFORMANCE
During the year, the Committee has monitored performance in
mitigating safety, health and environmental risks, and reviewed the
root cause of significant events. Though the total recordable
incidents and medical treatment case numbers have improved,
there was an increase in both the Lost Time Injury Frequency Rate
and Total Recordable Incident Rate, as illustrated by the table below.
ISRS should ensure comprehensive and robust systems and
standards are in place to systematically improve safety performance.
In December, we had a tragic fatality of a colleague and the injury of
another at the Westpoort site. Investigations by Renewi and the
authorities are ongoing, and immediate site safety improvements
were put in place to ensure such an incident cannot happen again.
To further improve safety across all Renewi sites, additional site
traffic safety actions and investments were planned.
Type of incident
FY2021/22
FY2022/23
% change
Medical Treatment Cases
Restricted Work Cases3
Lost Time Incidents
Fatalities
Total Recordable Incidents
Lost Time Injury Frequency
Rate (LTIF)1
Total Recordable Incident
Rate (TRIR)2
109
67
137
-
313
9
103
68
140
1
311
9.3
-5.5%
+1.5%
+2.2%
+100%
-0.6%
+3.3%
20.6
20.8
+1%
ROLLOUT OF ISRS
Work on adopting the ISRS continued throughout the year. Working
groups and committees were introduced for the various elements
and an implementation plan was produced. The Committee also had
oversight of ISRS training programmes and ISO targets. The rollout of
ISRS is on target, with the implementation of key element standards
on track for completion and finalisation in FY24.
FIRE PREVENTION INVESTMENTS
There have been a number of investments in fire prevention, such as
thermal inspection equipment, detection cameras and automatic
extinguishing systems, as well as the implementation of fire standard
improvements. These improvements have meant that less major
fires have occurred during the year; however, the incidences of minor
fires did not reduce, in part due to the growing use of batteries as
well as better incident reporting.
DRIVER AND VEHICLE SAFETY
The importance of driver and vehicle safety is highly important to the
Committee. There have been initiatives aimed at driver skills and
attitude throughout the year. A review of the fleet safety equipment
has also taken place, and the Committee is pleased to report that an
investment programme is under way to fit existing fleet vehicles with
sound, light and camera systems, which have been identified as
useful in improving the safety of some of the newer fleet vehicles.
ENVIRONMENTAL PERMIT CONTROLS
The Committee worked closely with the Executive Committee during
FY22 to design reporting dashboards and improve environmental
permits compliance and non-conformity information. Enhanced
reporting systems were implemented in FY23, which align with the
application of ISRS. The introduction of the reporting systems will
enable additional preventative and improvement measures where
necessary, in order to comply with current and future regulations.
1. Lost Time Injury Frequency Rate (LTIF) is the number of lost time injuries occurring per 1
million man hours worked.
2. Total Recordable Incident Rate (TRIR) is the total recordable incidents per 1 million man
hours worked.
3. Restricted Work Cases is number of cases when a person is so injured that they cannot
perform their normal duties.
Luc Sterckx
Chair of the SHE Committee
25 May 2023
Strategic reportGovernance reportFinancial statementsOther information 132
Audit Committee
Report
On behalf of the Board, I am pleased to
present the Audit Committee Report for the
year ended 31 March 2023.
KATLEEN VANDEWEYER
Chair of the Audit Committee
The Audit Committee assists the Board in fulfilling its
responsibilities relating to the Group’s corporate reporting
including sustainability and climate change, risk management
and financial controls and the internal and external audit
functions.
The report is intended to provide shareholders with an insight into
key areas considered, together with how the Committee has
discharged its responsibilities. This includes details of the significant
accounting matters and issues in relation to the Group’s financial
statements that the Committee has assessed during the year and
how these were addressed, and our process for concluding that this
Annual Report is fair, balanced and understandable. The other
primary responsibilities of the Committee, including ensuring that
the external auditor is independent and effective, ensuring that the
Group has an effective internal control framework and reviewing the
effectiveness of the Group’s internal audit function, are also detailed
over the following pages.
The Committee met four times during the year. The timing of
meetings coincides with key intervals in the Group’s reporting and
audit cycle. Regular attendees at Audit Committee meetings include
the Chief Financial Officer, the Group Financial Controller, the Group
Tax Manager, the Internal Audit Director and the external auditors.
Other attendees who attend as required include the Chief
Information Officer, Sustainability leads, other senior personnel and
other advisers to the Company.
Katleen Vandeweyer
Chair of the Audit Committee
25 May 2023
COMMITTEE MEMBERSHIP AND
FY23 COMMITTEE MEETING ATTENDANCE
Katleen Vandeweyer (Chair) 2 (2)
4 (4)
Neil Hartley
4 (4)
Luc Sterckx
3 (4)
Jolande Sap
1 (1)
Marina Wyatt
Bracketed figures indicate maximum potential attendance of each Director. Katleen
Vandeweyer was appointed in December 2022 and Marina Wyatt stepped down
from the Committee in July 2022.
ROLE OF THE COMMITTEE
The primary objective of the Audit Committee is to assist the
Board in fulfilling its corporate governance responsibilities
relating to the Group’s corporate reporting, risk
management systems, internal controls and any other
matters referred to it by the Board.
This covers:
• monitoring the integrity of the financial statements
including annual and half-yearly reports;
• reviewing and challenging the consistency and
appropriateness of and changes to significant accounting
policies, the methods used to account for significant or
unusual transactions, and appropriate estimates and
judgements;
• keeping under review the adequacy and effectiveness of
internal financial controls and internal control and risk
management systems;
• reviewing the adequacy of procedures for detecting fraud
and ensuring that appropriate arrangements are in place
to allow for company employees to raise concerns, in
confidence, about possible wrongdoing in financial
reporting or other matters;
• monitoring and review of the effectiveness of the internal
audit function in the context of the overall risk
management system;
• the appointment, terms of engagement, effectiveness,
objectivity and independence of the external auditors and
the nature and scope of the audit;
• the development and implementation of policy on the
engagement of the external auditor to supply non-audit
services; and
• reviewing the methodology and approach for reporting in
support of strategy set by the Board in relation to
sustainability and climate change.
For terms of reference go to renewi.com/audit
Renewi plcAnnual Report and Accounts 2023 133
COMMITTEE ACTIVITIES DURING FY23
At its meeting in May 2022, the Committee considered corporate
governance compliance, taxation and the FY22 financial statements.
At this meeting there was continued focus on the macroeconomic
outlook and the high inflationary environment and the challenges it
posed to the preparation of the FY22 financial statements with regard
to additional disclosures and the forecast modelling for going
concern and viability statements. The November 2022 meeting was
concerned primarily with the interim results, Group risk management
and internal control compliance, and internal audit performance.
The February 2023 meeting considered preparation of the FY23
financial statements and all other year-end accounting matters and
treatments, review of the external auditor’s plan and strategy, review
of the non-trading and exceptional items policy, year-end risk
management planning and the internal audit plan for the new
financial year. A further meeting in March 2023 dealt specifically with
sustainability matters, discussing the revised methodology for
carbon reporting and the recycling rate, considering limited
assurance options for scope 1 and scope 2 emissions. This meeting
also considered the next steps for compliance with new regulations
around the Corporate Sustainability Reporting Directive and the
requirements of International Sustainability Standard Board, both of
which will be applicable for subsequent reporting periods.
FINANCIAL STATEMENTS AND
SIGNIFICANT ACCOUNTING MATTERS
During the year and prior to the publication of the Group’s results for
the half year and full year, the Committee assessed whether suitable
accounting policies had been adopted, that management had made
appropriate estimates and judgements and disclosures were
appropriate. The Committee reviewed the main issues as noted
below, challenging management at various stages during the year.
After reviewing the reports from management, challenging the key
judgements and estimates and assessing the risks identified, the
Committee is satisfied that the Financial Statements address these
areas, both in respect of the amounts reported and the disclosures
made. The Committee has also reviewed the significant assumptions
used for determining the value of assets and liabilities and provided
appropriate challenge to ensure these are sufficiently robust. The
Committee has discussed these issues with the external auditors
during the audit planning process and at the finalisation of the
year-end audit.
The table is not a complete list of all the Group’s accounting issues,
judgements, estimates and policies but highlights the most
significant ones in the period. The accounting treatment of all
significant issues and judgements was subject to audit by the
external auditor as set out in their Independent Auditor’s Report.
ISSUE
REVIEW
Onerous contracts in UK Municipal
These provisions are judgemental and based on management’s best
estimates including long-term forecasts along with a number of
assumptions given the long-term nature of the contracts.
Presentation of underlying performance and other alternative
performance measures
Management continues to consider latest FRC guidelines on alternative
performance measures to ensure that the Annual Report and Accounts
have been prepared in line with best practice.
Given the significant provisions reflected in earlier years, reviews of
expected future cash flows and assumptions on a contract-by-contract
basis are discussed with management with appropriate challenge as part
of the interim and year-end procedures. Following these discussions, the
Committee concluded that the total level of provisions and the associated
disclosures included in the financial statements were appropriate at 31
March 2023, noting that there have been releases for some provisions and
increase for others.
The amendment to IAS 37 Onerous Contracts – Costs of Fulfilling a
Contract was effective from 1 April 2022. The impact of this change was
reviewed by the Committee during the March 2022 year end. The
Committee has considered the disclosure given to this matter in Section 1
Basis of preparation in the financial statements, including the statement
that, as permitted by the amendment, there has been no restatement of
comparative information.
Further to a more in-depth review of the East London contract in UK
Municipal and recent legal advice, management have determined that it
was incorrect to recognise a lease on the adoption of IFRS 16 in 2019.
Given the values involved it is appropriate to recognise a prior year
adjustment and amend the 1 April 2021 opening balance sheet. The
Committee reviewed the adequacy of the disclosure included in the
financial statements.
The Group’s performance measures continue to include some metrics
which are not defined or specified under IFRS reporting and the Group
discloses non-trading and exceptional items separately due to their size or
incidence to enable a better understanding of performance. Based on a
review of the supporting papers from management, the Committee
considers that these items have been appropriately classified and are in
line with the non-trading and exceptional items policy which is reviewed
annually by the Committee. The Committee also considered disclosure of
the Group’s alternative performance measures and noted that these are
set out in detail in note 8.3 in the financial statements together with
reconciliations of adjusted performance measures to statutory results.
Strategic reportGovernance reportFinancial statementsOther information 134
Audit Committee Report CONTINUED
ISSUE
REVIEW
Acquisition accounting
The Group has completed a signification acquisition in the year with the
purchase on 1 August 2022 of 100% of the share capital of GMP Exploitatie
B.V. and its subsidiaries for a cash consideration of €53.5m.
The assessment of purchase price allocation is a complex area involving
significant estimates and judgements. Consequently, management
engaged external advisory support to determine the fair value of assets
acquired on 1 August 2022. The Committee reviewed the adequacy of the
disclosure included in the financial statements.
Impairment considerations
The Group has a significant value of goodwill and other intangible assets.
As part of the normal impairment testing the Group has sufficient
headroom on the carrying values of its goodwill and therefore did not
recognise any impairments.
Landfill related provisioning
Landfill provisions, due to their nature, are judgemental as they are subject
to a number of factors including changes in legislation and uncertainty
over timing of payments.
Other provisions
The Group has a number of open legal and environmental matters.
Accounting for various tax-related matters
The most significant judgements for tax relate to deferred tax asset
recognition and uncertain tax positions.
Impairment testing is inherently subjective as it includes assumptions in
calculating the recoverable amount of the cash generating unit being
tested. Cash flow projections include discount rates that reflect the
appropriate risk, long-term growth rates and future profitability. The
annual impairment review is submitted to the February meeting with a
further update to the May meeting once final March information is
available. The Committee has reviewed the papers prepared by
management which also include downside modelling and sensitivity
analysis and concluded that there is sufficient headroom across all
cash-generating units. The goodwill note in the financial statements
includes the key assumptions used in the value in use calculations and
references sensitivity to changes in assumptions.
The annual review of provisions in discussions with management has
considered the assumptions used including discount rates and the period
of liability and has confirmed these are reasonable and appropriate.
Further to the FRC Corporate Reporting Review, external advice has been
obtained with regard to the discount rate methodology and the final
March 2023 values. In light of the FRC observations a number of
enhancements have been made to disclosures which the Committee have
reviewed and concluded that the disclosures as included in note 4.10 in
the financial statements are appropriate.
The Committee regularly monitors disputes and claims with a summary
of all open litigations and disputes a standing agenda item at all
meetings. Independent legal advice is received as appropriate and
reviewed in respect of the larger claims. The Committee discussed with
management the March 2023 European Commission determination that
no State Aid had been provided to the Group and that it was appropriate
to release the €15.1m provision. The Committee concurred with
management’s assessment that appropriate provisions are held with
adequate disclosure given in the contingent liability note in the Annual
Report and Accounts.
During the year, the Committee received verbal and written reports from
senior management on all tax related matters.
An uncertain tax position has arisen in the period. The Committee has
reviewed management’s papers of the provision reflected in the financial
statements and the additional disclosure setting out the maximum
exposure.
The Group has recognised a significant deferred tax asset. The Committee
has reviewed the Group’s considerations on future profitability to evaluate
the judgement that it is appropriate to reflect deferred tax assets with
regard to the UK and Dutch businesses and considered the disclosures
given in the financial statements.
GOING CONCERN AND VIABILITY
The Committee is required to make an assessment of the going
concern assumptions for the Group and the basis of the Viability
Statement before making a recommendation to the Board. A
comprehensive going concern assessment has been presented to
the Committee which included a review of medium-term cash flow
modelling over an 18-month period to 30 September 2024. As well as
a base case scenario setting out current expectations of future
trading, a downside scenario has been prepared. In addition, a
reverse stress test calculation has been undertaken to consider the
point at which covenants may be breached. The Committee
reviewed the detailed paper and cash flow analysis and challenged
management on the assumptions and judgements of the continued
cash generation of the Group and the compliance with covenants.
After careful consideration, the Committee has confirmed to the
Board that sufficient headroom exists and that the adoption of the
going concern principle remains appropriate.
The Committee also considered a paper and outputs from the
financial modelling prepared by management in respect of the
longer-term Viability Statement to be included in the Annual Report
and Accounts. The Committee discussed with management the risks,
sensitivities and mitigations for the modelled scenarios. The period
to be used for the viability modelling was discussed and it was
concluded that a three year period was appropriate based on the
Group’s business model and associated risks and market practice.
The Committee concluded that the longer-term viability statement
was appropriate and approved for recommendation to the Board.
Renewi plcAnnual Report and Accounts 2023 135
FAIR, BALANCED AND UNDERSTANDABLE
As part of its review of the FY23 Annual Report and Accounts, the
Committee considered whether the report, taken as a whole, was
fair, balanced and understandable and that it provided the
information necessary for shareholders to assess the Company’s
position, performance, business model and strategy. To assist
with this assessment, the Committee reviews an assessment
completed by management to illustrate the fair, balanced and
understandable aspects of the Annual Report and Accounts and a
summary of the review and approval processes involved. Following
consideration of these items at the May 2023 meeting and their
consideration of all developments in the year, the Committee is
satisfied that the key events and issues, both positive and negative,
have been adequately reflected and referenced in the Annual Report
and Accounts.
INTERACTION WITH THE FINANCIAL
REPORTING COUNCIL (FRC)
In December 2022, following a review of the Company’s Annual
Report and Accounts to 31 March 2022 in accordance with Part 2 of
the FRC Corporate Reporting Review Operating Procedures, the
Company received a request for information letter from the FRC
raising one question on discount rates used for provisions, along
with certain further recommended improvements for the report and
accounts. Following the Company’s response, the FRC confirmed
closure of the enquiry in a letter received in February 2023. The
letter requested certain enhancements to disclosures, including key
assumptions in determining provisions, any adjustments to risk free
rates from bond yields and further sensitivity analysis related to
inflation. These requests have been incorporated in the 31 March
2023 Annual Report and Accounts. In addition, the further
observations for improvements about the report and accounts
have been taken into consideration in the 2023 Annual Report
and Accounts.
During the year the FRC’s Audit Quality Review team reviewed BDO
LLP’s audit of the company’s 2022 Annual Report and Accounts. This
inspection was completed in early May 2023 and the final inspection
report review has been shared with us by the FRC. We have
discussed the findings with our external auditors and a number of
improvements on process have already been put in place and have
been fully operational for the 2023 audit.
EXTERNAL AUDITORS
Following the competitive tender carried out in 2019 and the
shareholder approval at the 2020 AGM, BDO LLP was appointed as
the Company’s statutory external auditor for the year ended 31
March 2021. The Committee holds private meetings with the
auditors in the absence of management and the Audit Committee
Chair also maintains regular contact with the audit partner
throughout the year.
In order to ensure the effectiveness of the external audit process,
BDO LLP conducts an audit risk identification process at the start of
the audit cycle. This plan is presented to the Audit Committee for its
review and approval and for the FY23 audit, the key audit matters
and significant risks identified included revenue recognition, landfill
provisions, onerous contract provisions, provisions for litigation and
claims and management override including presentation of
non-trading and exceptional items. Other areas of focus for this year
included acquisition accounting given the large acquisition in
Commercial Netherlands in the year, consideration of inflation given
the high inflationary environment and areas of taxation including
deferred tax recognition and uncertain tax positions.
The Committee reviews the performance and effectiveness of the
external auditors in performing the audit by carrying out an
assessment across a number of stakeholders looking across
various aspects of the process. Taking into account feedback from
the business and the Committee’s own experiences of working
with BDO LLP during the year, the Committee is satisfied that the
external auditors are providing an effective audit.
For the Committee and the Board, the objectivity of the Group’s
external auditors is key. The Committee reviews the independence
of the auditors on an annual basis. BDO LLP’s rotation rules
require the lead audit partner and key partners involved in the
audit to rotate every five years. BDO LLP is required to confirm to
the Committee that it has the appropriate independence and no
matters of concern were identified by the Committee. The
Committee’s responsibility to monitor and review the objectivity
and independence of the external auditor is supported by a
non-audit services policy. Specified services may be provided by
the external auditor subject to a competitive bid process, other
than in situations where it is determined by the Committee that
the work is closely related to the audit or when a significant
benefit can be obtained from work previously conducted by the
external auditor. The approval process of any new engagement
remains in place, with the CFO able to approve any new
engagement up to the value of €25,000, with anything in excess of
that limit requiring Committee approval. During the year €0.3m of
non-audit services were provided by BDO (2022: €0.2m). The total
audit fees, as disclosed in note 3.2 of the financial statements,
amounted to €2.1m (2022: €1.7m).
At the February 2023 meeting, the Committee discussed the
provision of non-audit fees of €2,200 from a separate BDO
firm which had not received all pre-approvals in line with the
non-audit services policy. The Committee acknowledged this
breach against the Ethical Standard and confirmed that it did
not threaten the independence of BDO LLP, noting that sufficient
mitigation actions had been put in place to prevent a
re-occurrence. During the year, tax and other professional services
have also been provided to the Group by the audit firms Deloitte,
PwC, EY and KPMG.
INTERNAL AUDIT
The internal audit function is an independent and objective
function which aims to improve Renewi’s overall control
framework and evaluate and improve the design and effectiveness
of control processes. Reviews of financial processes and cycles are
carried out and investigation activities are performed on control
failures to identify root cause and provide recommendations for
resolution and prevention. The Committee monitors and reviews
the effectiveness of its work and approves its annual plan.
Following the restrictive nature imposed by the Covid-19
pandemic in recent years, the internal audit programme in FY23
returned to fully on-site reviews. The detailed findings from all
reviews are presented to and considered by the Committee. Any
necessary actions and improvements are acted upon by local
divisional teams with revisits from internal audit as required and
regular follow-up at monthly business review meetings. Consistent
with previous years, internal audit services from suitably qualified
external providers were also engaged during the year.
There has been further enhancement of the key control
framework during the year with compliance reporting
consistently above 95%.
Strategic reportGovernance reportFinancial statementsOther information 136
Audit Committee Report CONTINUED
The Committee is provided with updates on the implementation of
agreed management actions and overall control environment
progress at each meeting.
• A range of quality assurance, safety and environmental
management systems are in use across the Group. Where
appropriate, these are independently certified to internationally
recognised standards and subject to regular independent auditing
ACCOUNTABILITY AND AUDIT
The responsibilities of the Directors and the auditors in relation to
the financial statements are set out on page 161.
• Prompt review by the Committee of any fraudulent activity or
whistle-blowing reports with appropriate action and follow up
• Where weaknesses in the internal control system have been
identified through the monitoring processes outlined above, plans
for strengthening them are put in place and action plans regularly
monitored until complete. The Board confirms that no material
weaknesses were identified during the year and therefore no
remedial action is required in relation to them
FINANCIAL REPORTING
In addition to the general risk management and internal control
processes described above, the Group has implemented internal
controls specific to the financial reporting process and the
preparation of the annual consolidated financial statements. The
main control aspects are as follows:
• Formal written financial policies and procedures applicable to all
business units
• A detailed reporting calendar including the submission of detailed
monthly accounts for each business unit, in addition to the
year-end and interim reporting process
• Detailed management review to Board level of both monthly
management accounts and year-end and interim accounts
• Consideration by the Board of whether the Annual Report is fair,
balanced and understandable
• Biannual certification by divisional Managing and Finance
Directors and Executive Directors on compliance with appropriate
policies and accuracy of financial information
• The Committee receives regular reports from the Group Tax
Manager on the Group’s tax policy, tax management and
compliance
ANTI-CORRUPTION AND ANTI-BRIBERY
The Renewi Code of Conduct and Reporting and Investigation
Protocol has operated throughout the year and integrity reporting is
a standing item at all Committee meetings. a standing item at all
committee meetings.
RISK MANAGEMENT
The Group Risk Management framework, major risks and the steps
taken to manage these risks are outlined on pages 86 to 99.
INTERNAL CONTROL RESPONSIBILITY
The system of internal control is based on a continuous process
of identifying, evaluating and managing risks, including the risk
management processes outlined on pages 86 to 91. The Board
of Directors has overall responsibility for the Group’s system of
internal control and for reviewing its effectiveness. The Board
recognises that internal control systems are designed to manage
rather than eliminate the risk of failure to achieve business objectives
and can therefore only provide reasonable and not absolute
assurance against material misstatements, losses, and the breach of
laws and regulations.
EFFECTIVENESS OF THE RISK MANAGEMENT
AND INTERNAL CONTROL SYSTEMS
In addition to the Board’s ongoing internal control monitoring
process, it has also conducted an annual effectiveness review of the
Group’s risk management and internal control systems in
compliance with Provision 29 of the UK Corporate Governance Code.
This covered risk management systems and all significant material
controls including financial, operational and compliance controls.
Specifically, the Board’s review included consideration of changes in
the risk universe and the Group’s ability to respond to these through
its review of business risk register controls and improvement action
plans. It also reviewed the six-monthly certification by divisional
management to ensure that appropriate internal controls are in
place as well as reports by internal audit and external auditors.
The main elements of the internal control and risk management
frameworks, which contribute towards continuous monitoring, are
as follows:
• A defined schedule of matters for decision by the Board
• Group manuals and guidance setting out financial and accounting
policies, minimum internal financial control standards and the
delegation of authority over items such as capital expenditure,
pricing strategy and contract authorisation
• A comprehensive planning and budgeting exercise
• Performance is measured monthly against plan, prior year and
latest forecast results with explanations sought for significant
variances. Key performance indicators are also used to provide
early warning of potential additional risk factors
• Monthly meetings with the divisional management teams to
discuss performance and plans
• Appointment and retention of appropriately experienced and
qualified staff to help achieve business objectives
• An annual risk-based internal audit plan approved by the
Committee. Summaries of audit findings and the status of action
plans to remedy any significant failings are discussed at Group
Board and Committee meetings on a regular basis
• A monthly key control framework is in operation in all Divisions
and functions with a summary of compliance reported to the
Group Board monthly
Renewi plcAnnual Report and Accounts 2023 137
Nomination
Committee Report
On behalf of the Board, I am pleased to
present the Nomination Committee Report
for the year ended 31 March 2023.
BEN VERWAAYEN
Chair of the Nomination Committee
COMMITTEE MEMBERSHIP AND
FY23 COMMITTEE MEETING ATTENDANCE
Ben Verwaayen (Chair) 4 (4)
4 (4)
Allard Castelein
3 (3)
Marina Wyatt
4 (4)
Jolande Sap
4 (4)
Luc Sterckx
4 (4)
Neil Hartley
1 (1)
Katleen Vandeweyer
Bracketed figures indicate maximum potential attendance of each Director. Katleen
Vandeweyer was appointed in December 2022 and Marina Wyatt stepped down
from the Committee in July 2022.
ROLE OF THE COMMITTEE
• Review the structure, size and composition (including the
skills, knowledge, experience and diversity) of the Board
and make recommendations to the Board with regard to
any changes
• Give full consideration to succession planning for Directors
and other senior executives and, in particular, for the key
roles of Chairman and Chief Executive Officer
• Keep under review the leadership needs of the Company,
both executive and non-executive, with a view to ensuring
the continued ability of the organisation to compete
effectively in the marketplace
• Identify and nominate, for the approval of the Board,
candidates to fill Board vacancies as and when they arise
• Recommend the election and re-election by shareholders
of Directors under the annual re-election provisions,
having due regard to their performance and contribution
in light of the knowledge, skills and experience required
and the need for progressive refreshing of the Board
• Review the results of the annual Board performance
evaluation process
For terms of reference go to renewi.com/nomco
The Committee met four times during the year and details of
members’ attendance are shown opposite. The Committee was
particularly focused on the recruitment of a new Chief Financial
Officer and a new Non-Executive Director/Chair of the Audit
Committee as well as senior management succession planning.
DIVERSITY AND INCLUSION
Renewi is committed to offering a rewarding, diverse and inclusive
working environment. With regard to gender diversity, the target that
has been set is to increase the percentage of women across Renewi,
including in the senior leadership team, to 25% by 2025.
With the appointment of Annemieke den Otter to the position of
Chief Financial Officer in June 2022 and Katleen Vandeweyer, who
replaced Marina Wyatt as a Non-Executive Director and Chair of the
Audit Committee in December 2022, female representation at Board
level is 37.5%.
Renewi first established a dedicated Diversity and Inclusion (D&I)
Board in 2021. It is chaired by the Chief Executive Officer and
comprises a diverse group of Renewi colleagues who meet regularly
to discuss D&I initiatives and plans and monitor progress against
targets and objectives. Employee representatives are invited to join
the D&I Board to enable the contribution of opinions and ideas from
across the whole workforce.
The main aims and achievements of the D&I Board during the
year included:
1. Progress towards achieving our target of 25% women working
at Renewi with 30% of women in leadership roles by 2025
• To date these figures stand at 20% with 24% of women in
leadership roles
2. Inclusion: making sure everyone feels included and heard
• From our employee Pulse surveys, 82% of all Renewi employees
believe that Renewi is an inclusive employer
• 74% of all employees agree that they and their colleagues are
treated equally by management
3. Communication: ensuring everyone understands what D&I
is, what Renewi stands for and what Renewi is doing to become
a diverse and inclusive employer
• 86% of our employees have seen and heard about diversity
and inclusion at Renewi
4. Embrace and celebrate our diverse workforce
• Our second annual Diversity Day across Renewi was held
Strategic reportGovernance reportFinancial statementsOther information 138
Nomination Committee Report CONTINUED
on 4 October 2022 with the theme of cultural celebrations
• Internal communications were provided and information was
provided to managers on how to support team members that
participate in the feast of Ramadan
5. Work on unconscious bias
• During the year an Unconscious Bias training programme was run
for hiring managers and HR Business Partners in the Netherlands,
Belgium and the UK, with further rollout to all managers planned
for FY24
TALENT ACQUISITION AND DEVELOPMENT
Given the tight labour market there were some challenges in filling
vacancies, but over the course of 2022, Renewi hired 940 colleagues,
of which 20% were internal hires. This was greatly assisted by
targeted social media campaigns, improved HR processes and
insourcing of most recruitment activities and investment in
employer branding.
During talent reviews across the Group, 38 young people were
identified as having the potential to fulfil a future leadership role.
A programme has been designed to help them develop the skills
and qualities to position themselves as future leaders of Renewi.
In addition, the Renewi leadership programme, LEAD, continued
to offer training, development and support for managers across
all Divisions. This will include safety leadership training for our
leaders in all Divisions and functions.
In January 2023, a programme of ‘meet and greet’ lunches with the
Board was established. The purpose of these is to connect specific
groups of Renewi employees, whether based on functional
specialism, potential leadership, long service or other characteristics
with Board members through informal, engaging and open
conversation. These interactions are informative for the Board,
recognise the contribution such specific groups can make and
are intended to motivate and inspire.
Further details are set out in the Care for People section on pages
66 to 71.
SUCCESSION PLANNING
As reported last year, Toby Woolrych left the Board as Chief Financial
Officer on 31 March 2022 and was replaced by Annemieke den Otter
on 1 June 2022. It was also announced last year that Non-Executive
Director and Chair of the Audit Committee, Marina Wyatt, would be
stepping down from the Board at the conclusion of the AGM on 14
July 2022.
Following an extensive search for her successor, Katleen Vandeweyer
was appointed to the Board as a Non-Executive Director and Chair of
the Audit Committee on 1 December 2022. The selection process,
assisted again by search consultants Heidrick & Struggles, included a
comprehensive shortlisting process followed by interviews by
Committee members, the CEO and Group HR Director. Other than
their assistance in recruiting both Annemieke den Otter and Katleen
Vandeweyer, search consultants Heidrick & Struggles also assisted
with the search for a small number of below Board positions.
A short introductory question and answer interview with Katleen
Vandeweyer is set out on page 119.
Biographical details of Katleen and the other members of the Board
and Executive Committee can be found on pages 106 to 109 and are
also available on the Company website.
Any new Director appointed to the Board is subject to election
by shareholders at the first opportunity after their appointment.
All Directors are also required under the Company’s Articles of
Association to stand for re-election at each AGM.
Succession plans were reviewed in the year and action plans
prioritised to ensure a potential pipeline of internal candidates
for senior positions within the Group.
BOARD EVALUATION
The FY22 review of Board and Committee effectiveness as reported
last year was undertaken with the use of an externally facilitated
structured questionnaire facilitated by the Company Secretary.
Key findings from the FY22 review and subsequent actions are
detailed below.
FINDING
ACTION
Clearer communications
around primary strategic
sustainability focus and
purpose of the business
• Investor relations focus
• Improved recycling rate and targets
• Improved CDP Climate change ranking
Development of closer
engagement with all
stakeholders to drive the
circular economy
• Renewi’s ongoing Mission75 programme
to generate ideas and co-innovate
• Board lunch meetings with employee
teams to drive debate and actions
• Customer focus initiatives
Ongoing promotion
of diversity and inclusion
objectives throughout
the Group
• Appointment of Annemieke den Otter
and Katleen Vandeweyer to the Board
• Ongoing initiatives through the Diversity
and Inclusion Board
Board tenure
Background/experience of Non-Executive Directors
Male
Female
Total
Male
Female
Total
1–3 years
3–5 years
5–7 years
1
2
2
2
1
-
3
3
2
Energy/chemicals
Politics/socio-economics
Telecoms/digital
Transport
Private equity/investment
1
-
1
1
1
-
1
1
-
0
1
1
2
1
1
Renewi plcAnnual Report and Accounts 2023 139
Customer Care, Amersfoort
The evaluation also identified a number of areas of focus to further
enhance Board performance. These included taking time for the
entire Board to plan and structure the annual agenda and to create
space to discuss specific business topics in even greater detail.
Following the review, which was supplemented by individual
discussions with the Directors by the Chairman, the Board concluded
that, along with its Committees, it had continued to operate
effectively during the year and that each Director had continued
to demonstrate commitment to their role and performed capably.
The Senior Independent Director led the review of the Chairman’s
performance with the other Directors. The Board is therefore able to
recommend the election and re-election of all those Directors
standing at the forthcoming AGM.
Ben Verwaayen
Chairman
25 May 2023
FY23 EVALUATION
It was determined that the FY23 evaluation would again be carried
out via a structured questionnaire survey of the Directors and the
Company Secretary. After a shortlisting process undertaken by the
Chairman and Company Secretary, it was agreed that this be
facilitated for a second year by Gould Consulting, with whom the
Group has no other commercial relationship.
Gould Consulting is fully compliant with the Chartered Governance
Institute’s Code of Practice for Independent Board Reviewers,
published in January 2021.
Having considered the results and themes which had emerged from
the evaluation, the Board agreed specific FY23 action plans across
three main areas:
• Development of the Renewi culture and way of working, centred
around safety, health and environmental performance
• Wider active engagement with all stakeholders to focus the Board
agenda and support the drive for a circular economy
• Broadening of Renewi’s influence to contribute to European and
UK sustainability and climate change policy
Nationality
Number
Board member
Dutch
Belgian
UK
5
2
1
Ben Verwaayen, Allard Castelein, Jolande Sap,
Otto de Bont, Annemieke den Otter
Luc Sterckx, Katleen Vandeweyer
Neil Hartley
Strategic reportGovernance reportFinancial statementsOther information
140
Directors’
Remuneration Report
On behalf of the Board, I am pleased to
present the Directors’ Remuneration Report
for the year ended 31 March 2023.
NEIL HARTLEY
Chair of the Remuneration Committee
COMMITTEE MEMBERSHIP AND
FY23 COMMITTEE MEETING ATTENDANCE
3 (3)
Neil Hartley (Chair)
2 (3)
Allard Castelein
3 (3)
Luc Sterckx
Bracketed figures indicate maximum potential attendance of each Director.
ROLE OF THE COMMITTEE
• Determines the Group’s policy on remuneration and
monitors its implementation
• Reviews and sets performance targets for incentive plans
• Sets the remuneration of the Group’s senior management
• Approves the specific remuneration package for the
Chairman, each of the Executive Directors and below
Board members of the Executive Team
• Determines the terms on which LTIP, Deferred Annual
Bonus and Sharesave awards are made to employees
• Determines the policy for and scope of pension
arrangements for the Executive Directors and below Board
members of the Executive Team
For terms of reference go to renewi.com/remco
This Report, prepared by the Remuneration Committee on
behalf of the Board, takes full account of the UK Corporate
Governance Code and the latest Investment Association (IA)
Principles of Remuneration and Institutional Shareholder
Services (ISS) UK and Ireland Proxy Voting Guidelines. It has
been prepared in accordance with the provisions of the
Companies Act 2006 (the Act), the Listing Rules of the
Financial Conduct Authority and the Large and Medium-Sized
Companies and Groups (Accounts and Reports) (Amendment)
Regulations 2013, the Companies (Miscellaneous Reporting)
Regulations 2018 and the Companies (Directors’ Remuneration
Policy and Directors’ Remuneration Report) Regulations 2019.
The Act requires the Auditor to report to the Group’s
shareholders on the audited information within this
Report and to state whether in their opinion those parts
of the Report have been prepared in accordance with the
Act. The Auditor’s opinion in this regard is set out on page 169
and those aspects of the Report that have been subject to
audit are clearly marked.
SUMMARY
The key elements of the Directors’ Remuneration Report are
outlined below.
• Annual Statement. Summarises performance and reward in
the year ended 31 March 2023 and the proposed changes to the
Remuneration Policy which, subject to shareholder approval,
will be operated for the year ending 31 March 2024
• Remuneration Policy. Details the Remuneration Policy, which
will be put to shareholders at the 2023 AGM, given that the 2020
Policy is reaching the end of its three-year life
• Annual Report on Remuneration. Details how the
Remuneration Policy was implemented during the year ended 31
March 2023 and how the Committee intends the new Policy to
apply for the year ending 31 March 2024
WORK OF THE COMMITTEE DURING THE YEAR
The Committee met three times during FY23 and details of
members’ attendance at meetings are shown above. The main
Committee activities during the year (full details of which are set
out in the relevant sections of this Report) included:
• agreeing the performance against the targets and payout for
the FY22 annual bonus awards;
• setting the performance targets for the FY23 annual bonus;
• agreeing the vesting levels for the 2019 LTIP awards which
vested in 2022;
• agreeing the award levels and performance targets for the 2022
LTIP awards;
Renewi plcAnnual Report and Accounts 2023 141
Commercial Waste NL,
Nieuwegein
• agreeing Executive Director base salary increases and the
Chairman’s fee from 1 April 2023;
• appointing Mercer Limited as the new independent advisers to the
Committee after a tendering process;
• considering regulatory/disclosure developments and shareholder
views during FY23;
• reviewing the Remuneration Policy, agreeing proposed changes
and consulting with shareholders; and
• ongoing liaison with the SHE Committee to ensure alignment on
ESG targets.
In addition, the Committee has considered how the Remuneration
Policy and practices are consistent with the six factors set out in
Provision 40 of the 2018 UK Corporate Governance Code:
• Clarity. Our policy is well understood by our senior team and
employees more generally and has been clearly articulated
• Simplicity. The Committee is mindful of the need to avoid overly
complex remuneration structures which can be misunderstood
and deliver unintended outcomes. As such, our executive
remuneration policies and practices are as simple to communicate
and operate as possible, while ensuring that they are aligned to
our strategy
• Risk. Our Remuneration Policy is based on: (i) a combination
of both short- and long-term incentive plans based on financial,
non-financial and share price-linked targets; (ii) a combination of
cash and equity (in terms of both deferred bonus and LTIP awards);
and (iii) a number of shareholder protections (i.e. bonus deferral,
shareholding guidelines, malus/clawback provisions) which have
been designed to mitigate the impact of inappropriate risk-taking
• Predictability. Our incentive plans are subject to individual caps,
with our share plans also subject to market standard dilution
limits. The scenario charts in the Remuneration Policy illustrate
how the rewards potentially receivable by our Executive Directors
vary based on performance and share price growth
• Proportionality. There is a clear link between individual awards,
delivery of strategy and our long-term performance. In addition,
the structure of our short- and long-term incentives, together with
the structure of the Executive Directors’ service contracts, ensures
that poor performance is not rewarded
• Alignment to culture. Renewi’s focus on making valuable
products from waste, meeting the growing need to deal with waste
sustainably and cost-effectively, is fully supported through the
metrics in both the annual bonus and long-term incentive which
measure how we perform against main KPIs that underpin the
delivery of our strategy
Strategic reportGovernance reportFinancial statementsOther information 142
Directors’ Remuneration Report CONTINUED
Annual Statement
On behalf of the Board, I am pleased to present the Directors’
Remuneration Report for the year ended 31 March 2023. I have
summarised below the key decisions the Committee has taken
during the year and provided an explanation of the context in
which they were made.
FY23 PERFORMANCE, DECISIONS AND
REWARD OUTCOMES
FY23 annual bonus
Profit and net debt/leverage targets were exceeded, contributing
to the financial target element of the bonus measures.
Personal targets were also largely met. This resulted in bonus
awards of 115% and 118% of the base salaries of the Chief
Executive Officer and Chief Financial Officer respectively. These
represented 77% and 79% of the maximum bonus potential for
the Chief Executive Officer and Chief Financial Officer respectively.
Further details are set out on page 152.
2020 LTIP vesting in 2023
The Long-Term Incentive Plan (LTIP) granted in 2020 was
designed to incentivise and reward the achievement of Earnings
Per Share (EPS) growth, Total Shareholder Return (TSR), the
recycling rate based on the Company’s sustainability plan
(recycling rate) and, for Executive Directors only, Return on Capital
Employed (ROCE) over the three-year performance period to 31
March 2023. Save for the recycling target all targets were
exceeded, resulting in 96.25% vesting. Further details are set out
on page 153.
Use of Remuneration Committee discretion
Annemieke den Otter joined the Board as Chief Financial Officer
on 1 June 2022. The Committee used its judgement to determine
the composition of Annemieke’s remuneration and benefits
package within the limits defined by the Remuneration Policy.
Details of her remuneration are set out on page 151. The
Committee did not exercise discretion on Director remuneration
in any other way during the year.
Policy Review
As the current Remuneration Policy is reaching the end of its
three-year life, the Committee reviewed the Remuneration Policy
holistically during the year with the assistance of independent
advisers and taking into account feedback previously received
from shareholders.
The Committee believes that the Policy continues to be effective
in rewarding our Executive Directors and notes the high level of
shareholder support received when the Policy was introduced
in 2020 and in subsequent votes on its implementation.
As such, only minor changes have been made to the
Remuneration Policy. One minor change includes the removal of
a monetary cap of benefits to allow the Committee the flexibility
to ensure that the Executive Directors have access to the same
benefits available to the wider workforce. For the avoidance of
doubt, no material changes to benefit provision are planned and
if any substantial benefits were to be introduced for Executive
Directors, this would be done in consultation with shareholders.
For details of the Remuneration Policy Review see page 143.
Implementing the Policy for FY23
In respect of the implementation of the Remuneration Policy
for FY23:
• On 1 April 2023, the Chief Executive Officer’s base salary was
increased by 8% in line with the wider workforce rate of increase.
The Chief Financial Officer’s base salary was increased by 4% in
light of her recent appointment
• The Executive Directors continue to receive a cash supplement
in lieu of pension of 12.5% of salary (in line with the local
workforce)
• The annual bonus will continue to have a maximum opportunity of
150% of base salary for both the Chief Executive Officer and Chief
Financial Officer. Performance metrics will continue to have a
majority financial weighting and will be disclosed retrospectively
following the end of the financial year
• LTIP grants for Executive Directors will continue to be set at levels
no greater than the equivalent value of 150% and 120% of the base
salaries of the Chief Executive Officer and Chief Financial Officer
respectively Performance metrics will continue to be based on
EPS, ROCE, relative TSR and a key sustainability measure
(the Group’s recycling rate)
• To simplify the supplementary fees for the Board, the Senior
Independent Director’s fee will be aligned to that of Committee
chair increases to £10,012
• Non-Executive Director base fees are increased by 5.8% in line with
the average Executive Committee increase rate. There will be no
increase to the Chairman’s fee
LOOKING FORWARD
At the 2022 AGM, the Annual Statement and Annual Report on
Remuneration received the support of more than 98.32% of votes
cast. The Committee would like to thank shareholders for their
continued support and asks that they similarly support the 2023
Directors’ Remuneration Report and new Remuneration Policy
AGM resolutions.
Neil Hartley
Chair of the Remuneration Committee
25 May 2023
Renewi plcAnnual Report and Accounts 2023 143
Directors’ Remuneration Policy
The principal objective of the Remuneration Committee is to design
and implement a Remuneration Policy that promotes the long-term
success of the Company. The Committee seeks to ensure that the
senior executives are fairly rewarded in light of the Group’s
performance, taking into account all elements of their remuneration
package. A significant proportion of executive remuneration is
performance-related, comprising an annual bonus and a Long-Term
Incentive Plan. The fixed proportion of remuneration comprises
basic salary, benefits and a payment in lieu of pension.
POLICY SCOPE
The Policy applies to the Chairman, Executive Directors and
Non-Executive Directors.
POLICY DURATION
Given that the current Directors’ Remuneration Policy Report
(approved at the AGM on 16 July 2020, receiving 95.12% support)
will shortly reach the end of its three-year life, a new policy will be
put to shareholders for approval at the 2023 AGM and shall apply
from such approval. Subject to approval, the new Policy will apply
from that date for a maximum of three years until the AGM in 2026.
CHANGES FROM THE CURRENT POLICY
The Committee believes that the Policy continues to be effective
in rewarding our Executive Directors and therefore, have not made
any fundamental changes.
As such, only minor changes have been made to the Remuneration
Policy. One minor change includes the removal of a monetary cap
of benefits to allow the Committee the flexibility to ensure that the
Executive Directors have access to the same benefits available to the
wider workforce. For the avoidance of doubt, no material changes
to benefit provision are planned and if any substantial benefits were
to be introduced for Executive Directors, this would be done in
consultation with shareholders.
POLICY TABLE
OPERATION
OPPORTUNITY
PERFORMANCE METRICS
BASE SALARY: To pay a competitive basic salary to attract, retain and motivate the talent required to operate and develop the
Group’s businesses
Base salaries are generally reviewed on an annual
basis or following a significant change in
responsibilities.
Salary levels are reviewed by reference to companies
of similar size and complexity within the UK and
Continental Europe reflecting Renewi’s growing
presence across Europe. The Committee also has
regard to individual and Group performance and
changes to pay levels across the Group.
For Executive Directors, it is anticipated that
salary increases will normally be in line with
those of salaried employees as a whole. In
exceptional circumstances (including, but not
limited to, a material increase in job size or
complexity or a material market
misalignment), the Committee has discretion
to make appropriate adjustments to salary
levels to ensure they remain market-
competitive.
None.
PENSION: To provide an opportunity for executives to build up a provision for income on retirement
Executive Directors may receive a pension
contribution or cash allowance in lieu of pension.
A maximum employer contribution of
12.5% of basic salary in line with the local
workforce rate.
None.
The Committee reserves the discretion to
review this rate in line with movements to
the workforce rate.
BENEFITS: To provide market-competitive benefits
Benefits include life assurance, medical insurance, tax
advisory services, income protection and car/travel
allowances.
Executive Directors are also eligible to participate in
Renewi’s Working from Home policy which provides a
nominal allowance per day.
Executive Directors may also be eligible to any new
benefit introduced for the wider employee workforce
in their local market.
There is no defined maximum. Benefits
are set at reasonable levels in order to
be market competitive for the relevant
local jurisdiction and are dependent on
individual circumstances.
The Committee retains discretion to approve
additional benefits in exceptional
circumstances (e.g. relocation or
expatriation).
None.
ALL-EMPLOYEE SHARE SCHEMES: To encourage Group-wide share ownership
Executive Directors may participate in all-employee
share scheme arrangements on the same terms
offered to employees.
The maximum opportunity will not
exceed the relevant jurisdictional limits,
where applicable.
None.
Strategic reportGovernance reportFinancial statementsOther information 144
Directors’ Remuneration Report CONTINUED
OPERATION
OPPORTUNITY
PERFORMANCE METRICS
ANNUAL BONUS: To motivate senior executives to maximise short-term performance and help drive initiatives that support
long-term value creation
Performance measures, targets and weightings are
set at the start of the year. The maximum bonus is
payable only if all performance targets are met in full.
150% of salary.
50% of any bonus is awarded in shares, with half
vesting immediately and the other half deferred into
an award over Renewi plc ordinary shares which vests
after three years.
Dividend equivalents may accrue over the relevant
vesting period of deferred share awards to the extent
awards vest.
Malus & clawback:
The Committee may at its discretion not pay
bonuses/reduce deferred share awards and/or
recover bonuses which have been paid or shares
which have vested under deferred share awards in the
following circumstances: misstatement of the
Company’s financial results, an error in calculating
the vesting result, misconduct, material corporate
failure, material risk management failure, serious
reputational damage or material loss caused by
the participant’s actions.
Executive Director performance is assessed
by the Committee on an annual basis by
reference to Group financial performance
(e.g., profit or cash flow measures) (majority
weighting) and the achievement of personal
or strategic objectives (minority weighting).
Bonus targets are generally calibrated with
reference to the Group’s budget for the year.
The Committee has the discretion to
adjust the formulaic bonus outcomes
both upwards (within the plan limits) and
downwards, to ensure that payments are
a true reflection of performance over the
performance period, e.g., in the event
of unforeseen circumstances outside
management control.
LONG-TERM INCENTIVE PLAN (LTIP): To motivate and retain senior executives and managers to deliver the Group’s strategy and
long-term goals and to help align executive and shareholder interests
150% of salary.
Executive Directors and senior employees may
be granted awards annually, as determined by the
Committee. The vesting of these awards is subject
to the attainment of performance conditions.
Awards are in the form of Renewi plc ordinary shares.
Dividend equivalents may accrue over the vesting
period to the extent that awards vest.
Awards made under the LTIP have a performance and
vesting period of at least three years. If no entitlement
has been earned at the end of the relevant
performance period, then the awards will lapse. A
two-year post-vesting holding period applies to LTIP
awards granted to Executive Directors.
Malus & clawback:
The Committee may at its discretion decide that LTIP
awards are reduced and/or clawback vested LTIP
awards in the following circumstances: misstatement
of the Company’s financial results, an error in
calculating the vesting result, misconduct, material
corporate failure, material risk management failure,
serious reputational damage or material loss caused
by the participant’s actions.
Vesting of LTIP awards will be subject
to continued employment and financial,
strategic, environmental and/or share
price-related performance targets measured
over a period of at least three years.
In addition to the Group achieving the
financial/share price targets, the Committee
must satisfy itself that the recorded outcome
is a fair reflection of the underlying
performance of the Group.
Threshold performance will result in vesting
of no more than 25% of maximum under
each element.
The Committee has discretion (within the
limits of the scheme) to adjust the formulaic
performance outcomes to ensure that
payments fairly reflect underlying
performance over the period. Adjustments
may be upwards (subject to a maximum of
100%) or downwards.
SHAREHOLDING GUIDELINES: To align executive and shareholder interests
The Committee recognises the importance of
Executive Directors aligning their interests with
shareholders through building up significant
shareholdings in the Group.
Executive Directors are required to retain 100% (net of
tax) of any LTIP, annual bonus awarded in shares
which vest immediately and deferred bonus shares
acquired on vesting (net of tax) until they reach the
ownership guideline.
In employment:
200% of salary.
None.
Post employment:
200% of salary up until the second
anniversary of cessation.
Own shares purchased, shares acquired
through buyout awards and share awards
granted prior to the 2020 AGM will be
excluded from the post-employment
guideline.
Renewi plcAnnual Report and Accounts 2023 145
NOTES TO THE POLICY TABLE
Use of discretion
The Committee may apply discretion as detailed below. Under each
element of remuneration, a full description of how discretion can be
applied is set out in line with UK reporting requirements.
To ensure fairness and align executive remuneration with individual
and underlying Company performance the Committee may adjust
up or down (including to zero) the outcome of the annual bonus and
LTIP or the performance measures of inflight awards under either
plan. Any adjustments in light of ‘non-regular events’ (including, but
not limited to, corporate events (including Rights Issues), changes
in the Group’s accounting policies, minor or administrative matters,
internal promotions, external recruitment and terminations of
employment) are expected to be made on a ‘neutral’ basis – i.e.,
adjustments will be designed so that the event is not expected to
be to the benefit or the detriment of participants. Adjustments to
incentives to ensure that outcomes reflect underlying performance
may be made in exceptional circumstances to help ensure outcomes
are fair to shareholders and participants.
Performance measurement selection
The measures used in the annual bonus are selected annually to
reflect the Group’s main business and strategic priorities for the year
and capture both financial and non-financial objectives. Group
financial performance targets relating to the annual bonus plan are
based around the Group’s annual budget, which is reviewed and
approved by the Board prior to the start of each financial year.
Underlying profit before tax and cash-related targets are typically
used as the key financial performance measures in the annual
bonus plan because they are clear and well understood measures
of Group performance.
Performance targets are reviewed annually and set to be stretching
and achievable, taking into account the Group’s resources, strategic
priorities and the economic environment in which the Group
operates. Targets are set taking into account a range of internal
and external reference points, including the Group’s strategic plan
and broker forecasts for both the Group and sector peers. The
Committee believes that the performance targets are stretching,
and that to achieve maximum outcomes requires truly
outstanding performance.
The Committee considers the combination of three-year EPS growth,
ROCE improvement, share price growth and ESG (recycling rate)
target to be key indicators of long-term success for the Group. These
measures are transparent, visible and motivational to participants,
balance growth and returns, and provide good line-of-sight for
executives and alignment with shareholders.
Remuneration policy for our senior leaders
The Group’s approach to annual salary reviews is broadly consistent
across the Group, with consideration given to the scope of the role,
level of experience, responsibility, individual performance and pay
levels for comparable roles in comparable companies. The broader
Remuneration Policy across the Group is also consistent with that
set out in this Report for the Executive Directors. For example,
remuneration is linked to Group and individual performance in a way
that is ultimately aimed at reinforcing the delivery of shareholder
value. Senior employees generally participate in an annual bonus
scheme with a similar structure to that described for the Executive
Directors. Opportunities and specific performance conditions vary by
organisational level, with business area specific metrics incorporated
where appropriate. Members of the Executive Committee and other
senior managers may participate in the LTIP on a similar basis to,
but at lower levels than Executive Directors. Such awards may be on
the same terms as those granted to Executive Directors or they may
differ in respect of vesting periods, holding periods and performance
targets (i.e., the targets used and/or whether performance targets
apply for some or all of the awards). All UK employees are eligible
to participate in the Sharesave Scheme on the same terms although
other all-employee share arrangements may be introduced if
considered appropriate.
APPROACH TO RECRUITMENT REMUNERATION
External appointments
In the cases of hiring or appointing a new Executive Director, the
Committee may make use of any of the existing components of
remuneration, as described in the Policy Table. The maximum
limits for variable pay (excluding buyouts) will be as for existing
Executive Directors.
In determining the appropriate remuneration for a new Executive
Director, the Committee will take into consideration all relevant
factors (including the overall quantum and nature of remuneration,
and the jurisdiction from which the candidate is being recruited)
to ensure that all such arrangements are in the best interests of
Renewi and its shareholders.
The Committee may also make an award in respect of a new
appointment to buy out remuneration arrangements forgone on
leaving a previous employer on a comparable basis, in addition
to providing the normal remuneration elements. In constructing
a buyout, the Committee will consider all relevant factors including
time to vesting, any performance conditions attached to awards,
and the likelihood of those conditions being met. Any such buyout
awards will typically be made under the existing annual bonus and
LTIP schemes, although the Committee may exercise the discretion
available under the FCA Listing Rule 9.4.2 R to make awards using
a different structure. Any buy-out awards would normally have a fair
value no higher than that of the awards forgone and would normally
be payable no earlier.
Internal appointments
In cases of appointing a new Executive Director by way of internal
promotion, the Committee will determine remuneration in line
with the policy for external appointees. Where an individual has
contractual commitments made prior to promotion to the Board,
the Group will continue to honour these. Incentive opportunities for
below Board employees are typically no higher than for Executive
Directors, but measures may vary to ensure they are relevant to
the role.
Non-Executive Director recruitment
In recruiting a new Non-Executive Director, the Committee will use
the policy as described in the Policy Table. A base fee in line with
the prevailing rate for Board membership would be payable, with
additional fees payable for acting as Senior Independent Director
or Chair of a Committee, as appropriate.
SERVICE CONTRACTS AND EXIT PAYMENT POLICY
Executive Director service contracts, including arrangements for
early termination, are carefully considered by the Committee. The
Committee has agreed that the policy with regard to the notice
period for Executive Directors is one year’s written notice from the
Group (or less if required by local employment law) and one year’s
notice from the individual (or less if required by local employment
law). The contracts provide for an obligation to pay salary plus
Strategic reportGovernance reportFinancial statementsOther information 146
Directors’ Remuneration Report CONTINUED
contractual benefits for any portion of the notice period waived by
the Group where permitted by local employment law. The Group has
the ability to pay such sums in instalments, requiring the Director to
mitigate loss (for example, by gaining new employment) over the
relevant period.
Executive
Director
Effective date of
service contract
Notice period
(Company)
Notice period
(individual)
Otto de Bont
1 April 2019
12 months
Annemieke
den Otter
1 June 2022
12 months
6 months*
6 months*
*Both Executive Directors are Dutch residents and Dutch law limits the maximum notice they
can be required to provide.
If employment is terminated by the Group, the departing Executive
Director may have a legal entitlement (under statute or otherwise) to
certain payments, which would be met. In addition, the Committee
retains discretion to settle any other amounts reasonably due to the
Executive Director, for example to meet the legal fees incurred by the
Executive Director in connection with the termination of
employment, where the Group wishes to enter into a settlement
agreement (as provided for below) and the individual must seek
independent legal advice.
In certain circumstances, the Committee may approve new
contractual arrangements with departing Executive Directors
including (but not limited to) settlement, confidentiality, restrictive
covenants and/or consultancy arrangements. These will be used
sparingly and only entered into where the Committee believes that
it is in the best interests of the Group and its shareholders to do so.
When considering exit payments, the Committee reviews all
potential incentive outcomes to ensure they are fair to both
shareholders and participants. The table on the following page
summarises how the awards under the annual bonus and LTIP are
typically treated in different circumstances, with the final treatment
remaining subject to the Committee’s discretion.
Pay scenario charts
The charts below provide an estimate of the potential future reward opportunities for the Executive Directors, and the potential split between
the different elements of remuneration under four different performance scenarios: Minimum, Target, Maximum and Maximum with share
price growth. Potential reward opportunities are based on the Remuneration Policy, applied to basic salaries as at 1 April 2023. The projected
values exclude the impact of any dividends.
Chief Executive Officer (€000)
Minimum
100%
626
Target
42%
44%
14%
1,475
Maximum
28%
Maximum with
share price growth
24%
36%
31%
36%
2,242
31%
15%
2,646
0
500
1,000
1,500
2,000
2,500
3,000
Chief Financial Officer (€000)
Mimimum
100%
535
Target
44%
45%
1,221
11%
Maximum
30%
39%
31%
1,770
Maximum with
share price growth
26%
34%
27%
13%
2,045
0
500
1,000
1,500
2,000
2,500
3,000
Fixed pay
Annual bonus
LTIP
Share price growth
Notes
• The Minimum scenario shows basic salary, pension
and estimated benefits (i.e. fixed remuneration).
These are the only elements of the Executive
Directors’ remuneration packages that are not at risk
• The Target scenario reflects fixed remuneration as
above, plus a target bonus of up to 80% of maximum
and threshold LTIP vesting of 25%
• The Maximum scenario reflects fixed remuneration
plus full payout of all incentives based on the normal
bonus maximum and LTIP grant policy
• The Maximum with share price growth scenario
is as per Maximum but with a 50% share price
growth assumption
Renewi plcAnnual Report and Accounts 2023 147
TREATMENT OF AWARDS ON EXIT
SCENARIO
Annual Cash Bonus
TIMING OF VESTING
TREATMENT OF AWARDS
‘Good leaver’ – i.e., ill-health, disability, death,
retirement (with Group consent) or any other reasons
the Committee may determine in its absolute
discretion.
Normal payment date, although
the Committee has discretion
to accelerate.
Change of control.
Immediately.
Cash bonuses will only be paid to the extent that
Group and personal objectives set at the beginning
of the year have been achieved. Any resulting bonus
will generally be pro-rated for time served during
the year.
Performance against targets will be assessed at the
point of change of control and any resulting bonus
will generally be pro-rated for time served.
Any other reason.
Not applicable.
No bonus is paid.
Deferred Annual Bonus (DAB)
‘Good leaver’ – i.e., ill-health, disability, death,
retirement (with Group consent) or any other reasons
the Committee may determine in its absolute
discretion.
Normal payment date, although
the Committee has discretion to
accelerate.
Change of control.
Immediately.
Any outstanding DAB awards will generally
be pro-rated for time served.
Any outstanding DAB awards will generally
be pro-rated for time served. In the event of a
change of control, awards may alternatively be
exchanged for new equivalent awards in the acquirer
where appropriate.
Any other reason.
Not applicable.
Awards lapse.
Long-Term Incentive Plan (LTIP)
‘Good leaver’ – i.e., ill-health, disability, death,
retirement (with Group consent) or any other
reasons the Committee may determine in its
absolute discretion.
Normal vesting date, although the
Committee has discretion to
accelerate.
Any outstanding LTIP awards will generally be
pro-rated for time served and performance, subject to
the Committee’s discretion.
Change of control.
Immediately.
Any outstanding LTIP awards will generally be
pro-rated for time served and performance, subject to
the Committee’s discretion. In the event of a change of
control, awards may alternatively be exchanged for
new equivalent awards in the acquirer where
appropriate.
Any other reason.
Not applicable.
Awards lapse.
NON-EXECUTIVE DIRECTORS
The Non-Executive Directors do not have service contracts as their
terms of engagement are governed by letters of appointment. These
letters and the Company’s Articles of Association make provision for
annual renewal at each AGM. Details of the Non-Executive Directors’
terms of appointment are shown in the table opposite. The
appointment and re-appointment and the remuneration of
Non-Executive Directors are matters reserved for the full Board.
The Non-Executive Directors are not eligible to participate in the
Group’s performance-related incentive plans and do not receive
any pension contributions.
Non-Executive Director
Initial agreement date
Renewal date
Ben Verwaayen (Chairman) 8 March 2020
Allard Castelein
10 November 2016
Jolande Sap
Luc Sterckx
Neil Hartley
13 March 2018
3 August 2017
17 January 2019
Katleen Vandeweyer
12 October 2022
1 August 2023
1 August 2023
1 August 2023
1 August 2023
1 August 2023
1 August 2023
Non-Executive Directors’ fees are capped in the Company’s Articles of Association at an
aggregate of £750,000.
Strategic reportGovernance reportFinancial statementsOther information 148
Directors’ Remuneration Report CONTINUED
Details of policy on fees paid to Non-Executive Directors are set out in the table below:
OBJECTIVE
OPERATION
OPPORTUNITY
To attract and retain Non-
Executive Directors of the highest
calibre with broad commercial
and other experience relevant to
the Group.
Fee levels are reviewed annually, with any
adjustments effective 1 April each year.
The fee paid to the Chairman is determined by
the Committee and fees to Non-Executive Directors
are determined by the Board.
Additional fees are payable for additional
responsibilities – e.g., acting as Senior Independent
Director and as Chair of the Board’s Committees
and subsidiary company Supervisory Boards.
Fee levels are reviewed by reference to companies
of similar size and complexity within the UK and
Continental Europe reflecting Renewi’s growing
presence across Europe. The required time
commitment and responsibilities are taken into
account when reviewing fee levels. As such, the
Committee reserves the flexibility to pay additional
fees in the event that a Director’s expected time
commitment is significantly exceeded in any year.
Non-Executive Directors may receive benefits
necessary to carry out their duties (including travel
and office support, together with any associated tax
liability that may arise).
Non-Executive Director fee
increases are applied in line with
the outcome of the review. Fees
in respect of the year under
review, and for the following year,
are disclosed in the Annual
Report on Remuneration.
It is expected that any increases
to Non-Executive Director fees
will normally be in line with those
for salaried employees. However,
in the event that there is a
material misalignment with the
market or a change in the
complexity, responsibility or time
commitment required to fulfil a
Non-Executive Director role, the
Board has discretion
to make an appropriate
adjustment to the fee level.
PERFORMANCE
METRICS
None.
EXTERNAL APPOINTMENTS
The Committee acknowledges that Executive Directors may
be invited to join Supervisory Boards or become Non-Executive
Directors of other quoted companies which have no business
relationship with the Group and that these duties can broaden their
experience and knowledge to the benefit of the Group. Executive
Directors are limited to holding one such position, and the policy
is that fees may be retained by the Director, reflecting the personal
risk assumed in such appointments. The Chief Financial Officer,
Annemieke den Otter holds one such position. Her Supervisory
Board directorship of ForFarmers N.V attracts an annualised fee
of €50,500.
CONSIDERATION OF CONDITIONS ELSEWHERE
IN THE GROUP
Although the Committee does not consult directly with employees
on Executive Remuneration Policy, the Committee does consider
general basic salary increases across the Group, remuneration
arrangements and employment conditions for the broader employee
population when determining Remuneration Policy for the Executive
Directors. In compliance with the 2018 UK Corporate Governance
Code, Jolande Sap is the designated Non-Executive Director with
the responsibility of assisting the Board with workforce engagement
and reporting.
CONSIDERATION OF SHAREHOLDER VIEWS
When determining executives’ remuneration, the Committee takes
into account views of shareholders and best practice guidelines
issued by institutional shareholder bodies. The Committee seeks
feedback from shareholders on Remuneration Policy and
arrangements and commits to undergoing shareholder consultation
in advance of any significant Remuneration Policy changes. The
Committee will continue to monitor trends and developments in
corporate governance and market practice to ensure that the
structure of the executive remuneration remains appropriate. Further
details of the votes received in relation to last year’s Remuneration
Report and the 2020 Remuneration Policy are provided below:
ANNUAL REPORT ON
REMUNERATION
2022 AGM
REMUNERATION POLICY
2020 AGM
Total number
Total number
of votes % of votes cast
of votes1 % of votes cast
For (including discretionary)
40,067,792
98.32%
435,428,674
Against
684,333
Total votes cast (excluding withheld votes)
40,752,125
Votes withheld
14,904
1.68%
100%
–
22,337,973
457,766,647
245,442
95.12%
4.88%
100%
–
1. Actual votes cast, prior to July 2021, 1 for 10 share consolidation.
Renewi plcAnnual Report and Accounts 2023 149
Flint glass being processed
through optical sorters
Maltha, Lommel
Strategic reportGovernance reportFinancial statementsOther information 150
Directors’ Remuneration Report CONTINUED
Annual Report on Remuneration
The following section provides details of how our Remuneration
Policy will be implemented during the year ending 31 March 2024
and how it was implemented during the financial year ended
31 March 2023.
IMPLEMENTATION OF REMUNERATION
POLICY FOR FY24
Basic salary
In reviewing salaries this year, the Committee was mindful of the
inflationary pressures impacting our employees in certain markets.
The Company has approached the salary review holistically and as
such our average workforce salary increase for 2023 is higher than
in prior years at c.8%. The Company was also able to award all
employees (excluding those in Belgium where separate provisions
were made) an additional one-off payment of €250 to address the
cost of living pressures.
In recent years, the Executive Directors’ annualised basic salaries
have been increased in line with the general workforce rate of
increase. In this time, the Committee has been impressed with the
CEO’s leadership of the Company where we have seen significant
growth in the share price, which almost tripled within this period.
In this time, the Group has embarked upon several initiatives to
improve the business. First, the focus has shifted from the collection
of waste to the production of low carbon secondary materials, with
investments in new advanced sorting and treatment production
capacity, allowing for better returns. Second, the Renewi 2.0
programme is well under way, has resulted in improvements within
the Company in terms of process simplification, customer-focus and
employee engagement. In recognition of his contribution and after
reviewing market analysis, the Committee has decided to increase
the CEO’s salary by 8% to €538,746. This is commensurate with the
average range applied across the workforce.
Annemieke den Otter has settled in well since her appointment last
June. Given her recent appointment, the Committee decided to
increase her salary by 4% to €457,600. This reflects an increase below
the average workforce rate.
ANNUAL BONUS
The maximum annual bonus for Executive Directors for FY24 will
remain unchanged at 150% of salary with 50% payable in shares,
with half of those vesting immediately and the other half after three
years. The majority of the bonus will be based by reference to Group
financial performance and the remainder on the achievement
of personal or strategic objectives including ESG-related targets as
indicated below.
The specific targets are deemed to be commercially sensitive but
will be disclosed retrospectively in the FY24 Annual Report.
Bonus targets
Weighting
Performance targets
Underlying Profit
Before Tax
Leverage Ratio
Safety
40%
20%
15%
Personal Objectives
25%
Based on performance against expected
Budget outcome
Based on net debt to EBITDA covenant
level
Reduction in long-term injury frequency
rate
Linked to strategic goals and operational
performance
LTIP
LTIP awards for 2023 will be considered at the time of grant over
shares equal in value to no more than 150% of salary for the Chief
Executive Officer and 120% of salary for the new Chief Financial
Officer. The performance conditions will continue to be based on
EPS, ROCE, relative TSR and the Group’s recycling rate as follows
(final targets of which will be disclosed at time of grant):
Performance metric Stet
Performance targets
EPS
ROCE
Relative TSR
Recycling rate
25%
25%
25%
25%
25% of this part of an award vests for EPS
growth
25% of this part of an award vests for an
improvement in ROCE
25% of this part of an award vests for TSR
25% of this part of an award vests for an
increase in recycling rate
The Committee will continue to keep abreast of the workforce
experience when making decisions for the Executive Directors.
However, it is the Committee’s intention that both Executive
Directors will receive salary increases in 2024 that are no higher
than the workforce average.
For any shares to vest, the Committee will also need to satisfy itself
that the recorded outcome is a fair reflection of the overall
performance of the Group over the period. Awards will vest on the
third anniversary of grant and will be subject to a further two-year
holding period.
1 April 2022
1 April 2023
% increase
Otto de Bont
Annemieke den Otter1
€498,839
€440,000
€538,746
€457,600
8%
4%
1 Annemieke den Otter joined the Company as Chief Financial Officer on 1 June 2022.
PENSION
Executive Directors will continue to receive a cash supplement
in lieu of pension of 12.5% of salary in line with the local workforce.
Renewi plcAnnual Report and Accounts 2023 151
SINGLE TOTAL FIGURE OF REMUNERATION
FOR EXECUTIVE DIRECTORS (AUDITED)
The table below sets out a single figure for the total remuneration
received by each Executive Director for the year ended 31 March 2023
and the prior year.
CHAIRMAN AND NON-EXECUTIVE DIRECTOR FEES
Non-Executive Director base fees and Committee Chair fees were
increased on 1 April 2023 in line with the average increase applied to
the Executive Committee, this being less than the average workforce
rate of increase. Further to benchmarking carried out with the
assistance of the Committee’s remuneration consultants the Senior
Independent Director’s fee was recalibrated to be commensurate
with the fee paid for chairing a Board Committee. The Group
Chairman elected to waive any fee increase.
Base fees
Chairman
Non-Executive Director
Chair fee for Audit/Remuneration/
SHE Committees
Senior Independent Director
additional fee
Fee from
1 April
2022
Fee from
1 April
2023
% Increase
£160,429
£160,429
–
£53,442
£56,542
£9,463
£10,012
5.8%
5.8%
Basic salary
Taxable benefits2
Pension3
Other4
Total fixed remuneration
Single-year variable5
£6,680
£10,012
49.8%1
Multiple-year variable6,7
Total variable remuneration
1. Following benchmarking review to align Senior Independent Director fee with that of
Committee Chair fee.
Total
OTTO DE BONT
ANNEMIEKE DEN
OTTER1
FY22
€000
479
20
60
12
571
719
959
1,678
2,249
FY23
€000
499
20
62
12
593
574
1,347
1,921
2,514
FY22
€000
–
–
–
–
–
–
–
–
–
FY23
€000
367
8
46
11
432
433
–
433
865
1. Annemieke den Otter was appointed to the Board on 1 June 2022.
2. Taxable benefits comprise car allowance and medical insurance. E14K and E8K allowance
for Mr de Bont and Mrs den Otter respectively.
3. Cash supplement in lieu of pension contribution of 12.5% of base salary.
4. Includes life assurance and accident insurance.
5. Payment for performance during the year under the annual bonus including any deferred
annual bonus. (See following sections for further details).
6. Based on the estimated value of LTIPs granted in 2020 to Otto de Bont assuming 100%
vesting, dividend equivalent shares and a three-month share price to 31 March 2023 of £6.50.
The value of LTIP awards for FY22 was based on 100% vesting and a three-month share price
to 31 March 2022 of £6.77 and included dividend equivalents. The actual value of the awards
at vesting for Otto de Bont was £813,990.
7. The impact of share price movements on the vesting of the LTIP awards, based on the
average three-month share price to 31 March 2023 (£6.50) and the £2.58 (adjusted for the
1 for 10 share consolidation) share price at grant and ignoring dividend equivalents, is as
follows:
Otto de Bont
Shares granted
Value of awards expected to vest (180,322 shares granted x £6.50 x 100%
vesting)
Face value at grant of proportion of awards expected to vest (180,322 shares
granted x £2.58 x 100% vesting)
Impact of share price movement on vesting value
180,322
£1,172,093
£465,230
£706,862
SINGLE TOTAL FIGURE OF REMUNERATION FOR NON-EXECUTIVE DIRECTORS (AUDITED)
The table below sets out a single figure for the total remuneration received by each Non-Executive Director for the year ended
31 March 2023 and the prior year.
Ben Verwaayen (Chairman)
Allard Castelein2
Luc Sterckx3
Katleen Vandeweyer4
Jolande Sap
Neil Hartley5
Former Directors
Marina Wyatt6
BASE FEE
ADDITIONAL FEES
TOTAL FIXED REMUNERATION1
FY22
€000
188
61
60
-
60
60
60
FY23
€000
184
61
61
20
61
61
20
FY22
€000
FY23
€000
–
7
11
11
–
11
11
–
8
11
4
–
15
4
FY22
€000
188
68
71
–
60
71
71
FY23
€000
184
69
72
24
61
76
24
1. Non-Executive Directors receive fixed remuneration only (i.e. no variable remuneration is payable or has been paid).
2. Allard Castelein’s additional fee is in respect of his role as Senior Independent Director.
3. Luc Sterckx’s additional fee is in respect of his role as Chair of the SHE Committee.
4. Katleen Vandeweyer was appointed to the Board on 1 December 2022 and her additional fee is in respect of her role as the Chair of the Audit Committee.
5. Neil Hartley’s additional fee is in respect of his role as the Chair of the Remuneration Committee and also for his role as Chair of the Audit Committee for the four month interregnum
between Marina Wyatt’s departure and Katleen Vandeweyer’s appointment.
6. Marina Wyatt stepped down from the Board and as Chair of the Audit Committee on 14 July 2022.
7. At an exchange rate of €1:£0.849 for FY22 and €1:£0.870 for FY23.
Strategic reportGovernance reportFinancial statementsOther information 152
Directors’ Remuneration Report CONTINUED
INCENTIVE OUTCOMES FOR THE YEAR ENDED 31 MARCH 2023
Performance-related annual bonus in respect of FY23 performance
The annual bonus was measured against underlying profit before tax (40% weighting), net debt/EBITDA leverage ratio (20% weighting), ESG
(Safety) performance (15%) and the achievement of personal objectives (25% weighting). Actual performance against the targets set for each
of these elements is shown below.
FINANCIAL ELEMENT OUTCOMES
The financial targets and corresponding potential outcomes for the Executive Directors’ FY23 annual bonus are shown below.
Measure
Underlying profit before tax
Leverage ratio
Weighting
40%
20%
FY23
final outcome
€104.3m
1.83x
Threshold
Maximum
Actual bonus payout
(% of max)
€68.9m
2.5x
€94.8m
<2.05%
100%
100%
Underlying profit before tax is set based on the Group’s expected budget outcome for the year as adjusted for disposals and acquisitions
in the year. All non-Euro denominated entity values are converted to Euros at the budgeted rate of exchange and actual performance is also
measured at this constant exchange rate. The leverage ratio is based on the net debt to EBITDA covenant level as determined in the main
banking facilities.
ESG element outcomes
As safety is the Group’s first value and priority a collective safety target is included as part of the annual bonus targets. This includes a goal to
reduce significant incidents. Due to the tragic fatality of a colleague during the year, as reported in the SHECo report, no payout for this
element of bonus was awarded.
Personal element outcomes
The personal performance measures were based on individual objectives, as detailed below.
Executive Director
Target
Otto de Bont
1. Group safety
2. Strategy development
Weighting
8.33%
8.33%
Score
0%
8.33%
3. Talent management
8.33%
8.33%
Committee assessment of performance
Some improvements but outweighted by
fatality
Good progress made on value drivers.
Innovation pipeline and related investments
on stream. Increased sand and gravel
production at Mineralz & Water. Paro
acquisition. Divisional growth plans.
New CFO and Audit Chair appointed.
Improved succession planning. Engagement
eNPS score increased.
Annemieke den Otter
1. Simplify financial reporting
2. Renewi 2.0 and Digital Core programmes
3. Cost and cash management
4. Strategy development and investor relations
5. Engagement/talent management
25%
16.67%
66.68% of max
5%
5%
5%
5%
5%
3.75%
3.75%
2.5%
3.75%
5%
Good progress made.
Milestone achievements and steady progress.
Initial process improvements made.
Good progress made on value drivers.
Innovation pipeline and related investments
on stream. New investor relations focus.
Strengthening of finance function, including
internal promotions and transfers.
25%
18.75%
75% of max
FY23 annual bonus
Financial targets were met with Group profit before tax achieving a maximum payout for a 100% performance. The leverage ratio also resulted
in a maximum payout. The ESG (safety) target was not met. The personal targets were partially met, resulting in a bonus award of 76.67% and
78.75% of the maximum for the Chief Executive Officer and Chief Financial Officer respectively. The Committee is satisfied that these outcomes
are a fair reflection of the performance achieved over the year and the experience of the Group’s shareholders and
other stakeholders.
Overall bonus outcomes
Executive Director
Otto de Bont
Annemieke den Otter
Financial element
bonus outcome
(% of total)
60%
60%
Safety element bonus
outcome (% of total)
0%
0%
Personal element
bonus outcome
(% of total)
16.67%
18.75%
Overall bonus outcome
(% of salary/€)
115%/€573,690
118%/€433,125
50% of the bonus will be payable in cash and the other 50% will be deferred into Renewi Shares. 50% of these shares will vest immediately whilst the remaining 50% will vest after a further
-year holding period.
Renewi plcAnnual Report and Accounts 2023 153
2020 LTIP VESTING IN 2023
Otto de Bont holds an LTIP award over 180,322 shares made on 27 July 2020 which will vest in 2023 based on three-year performance to
31 March 2023. Vesting is dependent on three-year adjusted underlying EPS, relative share price performance (against the FTSE250 excluding
investment trusts), ROCE and performance against the Group’s waste recycling target. The vesting schedules, targets and the performance
against targets are set out below.
Measure
EPS CAGR
25%
Weighting
Targets
Actual % performance
Of this part of award
(% of maximum)
Relative TSR
25%
Improvement in ROCE
25%
0% vesting below 5% p.a.
25% vesting for 5% p.a.
50% vesting for 10% p.a.
100% vesting for 15% p.a.
Straight-line vesting between these points
0% vesting below median.
25% vesting for median.
100% vesting for upper quartile.
Straight-line vesting between these points
0% vesting below +0.5%
25% vesting for +0.5%
100% vesting for +2.0%
Straight-line vesting between these points
>15%
upper quartile
>2%
100%
(25%)
100%
(25%)
100%
(25%)
85%
(21.25%)
96.25%
Recycling rate
25%
0% vesting for a recycling rate below 67%
69.4%
25% vesting for a 67% recycling rate
100% vesting for a 70% recycling rate
Straight-line vesting between these points
Total vesting
Recycling rate assessed against consistent methodology as applied at time of original grant of award.
Share price growth is calculated using three-month average share prices immediately prior to the start and end of the performance period.
Based on the above, the vesting of the 2020 LTIP in July 2023 for Otto de Bont will be:
Executive Director
Awards granted1
Shares vesting based
on performance
Dividend equivalent
shares (estimated)
Total shares expected
to vest
Estimated value
at vesting (€’000)2
Otto de Bont
180,322
180,322
–
173,560
1,296
1. As adjusted for the 1:10 share capital consolidation following shareholder approval in July 2021.
2. Based on the average three-month share price to 31 March 2023 of £6.50 and at an exchange rate of €1:£0.870.
3. This award is subject to a further two-year post-vesting holding period.
The Committee is satisfied that this outcome is a fair reflection of the performance achieved over the performance period year and the
experience of the Group’s shareholders and other stakeholders.
SHARE AWARDS GRANTED IN THE YEAR (AUDITED)
Long-Term Incentive Plan
The Executive Directors were granted LTIP awards on 16 June 2022 as follows:
Executive Director
Date of grant
Basis of award
Share price1
Face value2
Number of shares
Otto de Bont
16 June 2022
Annemieke den Otter
16 June 2022
150% of salary
37% of salary3
£6.80
£6.80
€735,737
€159,698
94,131
20,432
1. Based on the three-day average dealing price prior to the grant date.
2. At an exchange rate of €1:£0.870.
3. Percentage agreed as part of joining arrangements.
Performance targets are as follows:
Performance metric Weighting
Performance targets
EPS
ROCE
Relative TSR
Recycling rate
25%
25%
25%
25%
25% of this part of an award vests for EPS growth of 5% p.a. increasing pro-rata to 100% vesting for EPS growth of 15% p.a.
or more
25% of this part of an award vests for an improvement in ROCE of 0.5% increasing pro-rata to 100% vesting for an
improvement in ROCE of 2% or more
25% of this part of an award vests for TSR equal to median increasing pro-rata to 100% vesting for TSR equal to upper
quartile or above against the FTSE 250 (excluding investment trusts)
25% of this part of an award vests for a recycling rate of 70% increasing pro-rata to 100% vesting for a recycling rate
of 73% or more
For any shares to vest, the Committee will also need to satisfy itself that the recorded outcome is a fair reflection of the overall performance
of the Group over the period. Awards will vest on the third anniversary of grant and will be subject to a further two-year holding period.
Strategic reportGovernance reportFinancial statementsOther information 154
Directors’ Remuneration Report CONTINUED
DEFERRED ANNUAL BONUS (DAB)
Otto de Bont was granted awards under the Renewi plc Deferred Annual Bonus Plan on 16 June 2022 as follows:
Executive Director
Date of grant
2021/22
annual bonus
Basis of award1 Share price2
Face value3
Number of shares
Otto de Bont
16 June 2022
€719k
25%
25%
£6.80
£6.80
€179,598
€179,598
22,978 shares vesting immediately
22,978 shares vesting after three years
1. 50% of the bonus is awarded in shares, with half vesting immediately and the other half deferred into an award over Renewi plc shares which vest after three years.
2. Based on the three-day average dealing price prior to the grant date.
3. At an exchange rate of €1:£0.870.
PAYMENTS MADE TO PAST DIRECTORS MADE IN THE YEAR (AUDITED)
No termination payments were made to past Directors during the year.
RELATIVE IMPORTANCE OF SPEND ON PAY
The table shows the percentage change in total employee pay expenditure and shareholder distributions from the financial year ended
31 March 2022 to the financial year ended 31 March 2023.
Distribution to shareholders
Employee remuneration
FY22
€m
–
402.5
FY23
€m
–
433.2
% change
0%
7.6%
PAY FOR PERFORMANCE
The graph shows the TSR of Renewi plc over the 10-year period to 31 March 2023. While there is no comparator index or group of companies
that truly reflects the activities of the Group, the FTSE Support Services sector has been selected as a comparator index as it is the sector
in which Renewi is classified and is an index against which the performance of the Group is judged. The FTSE All-Share Index is also
presented. The table below the graph details the Chief Executive Officer’s single figure remuneration and actual variable pay outcomes
over the same period.
Historical TSR performance
Growth in value over 10 years of a hypothetical £100 invested at 31 March 2013.
300
250
200
150
100
50
0
)
0
0
1
o
t
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Renewi plc
FTSE All-Share Support
Services Index
FTSE All-Share Index
Source: Datastream
(Thomson Reuters)
31 MAR
2013
31 MAR
2014
31 MAR
2015
31 MAR
2016
31 MAR
2017
31 MAR
2018
31 MAR
2019
31 MAR
2020
31 MAR
2021
31 MAR
2022
31 MAR
2023
CEO single figure remuneration over the 10 years to 31 March 2023
PETER DILNOT1
OTTO DE BONT3
Executive Director
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
FY22
FY23
Chief Executive Officer single figure of
remuneration (€000)
Annual bonus outcome
(% of maximum)
LTIP vesting outcome
(% of maximum)
1,015
1,155
1,456
1,100
1,685
753
1,244
1,017
2,249
2,514
66%
47%
69%
48%
88%
0%
88%
65%
100%
77%
0%
0%
0%
0%
21.5%
0%2
43.3%
22.5%
100%
96%
1. Peter Dilnot was appointed as Chief Executive Officer on 1 February 2012 and resigned on 31 March 2019.
2. Although 23% of the 2016 LTIP awards vested in 2019, Peter Dilnot’s LTIP awards lapsed upon his resignation.
3. Otto de Bont was appointed as Chief Executive Officer on 1 April 2019.
Renewi plcAnnual Report and Accounts 2023
155
PERCENTAGE CHANGE IN DIRECTORS’ REMUNERATION
The table below shows the percentage change in Director remuneration (excluding pension and long-term incentives) from the prior year
compared to the average percentage change in remuneration for all UK-based employees and a new Group wide employee set. This new
grouping reflects the experience of the vast majority of employees within Renewi whilst the UK-based peer employee group was used in
previous years and provides a robust basis for year on year comparison. From next year onwards, we will remove the UK-based peer group as
we will have sufficient year on year data for comparisons going forward.
Executive Directors
Otto de Bont
Annemieke den Otter
Non-Executive Directors
Ben Verwaayen
Allard Castelein
Neil Hartley
Jolande Sap
Luc Sterckx
Katleen Vandeweyer
UK employees
Groupwide employees
Base
salary
FY21–22
Benefits
FY22–23
Annual
bonus
Base
salary
Benefits
Annual
bonus
7%
n/a
7%
7%
7%
6%
22%
n/a
4%
n/a
-18%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
57%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
5%
n/a
4%
n/a
0%
4%
9%
4%
4%
n/a
7%
9%
2%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
-20%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
-11%
-34%
CEO PAY RATIO
The CEO pay ratio data for FY23 is presented below (with prior year data). The data shows how the CEO’s single figure remuneration for FY23
(as taken from the single figure remuneration table) compares to equivalent single figure remuneration for full-time equivalent UK employees
ranked at the 25th, 50th and 75th percentile. The increase in ratio is explained by the CEO transition from divisional management to Board and
increased LTIP awards and recent successful vesting.
Year
FY23
FY22
FY21
FY20
Method
Option B
Option B
Option B
Option B
25th percentile pay ratio
Median pay ratio
75th percentile pay ratio
86 : 1
63 : 1
33 : 1
41 : 1
71 : 1
41 : 1
31 : 1
38 : 1
51 : 1
45 : 1
19 : 1
23 : 1
No components of pay and benefits have been omitted for the purpose of the above calculations. Option B (UK gender pay gap data) was
selected, given that this method of calculation was considered to be the most efficient and robust approach in respect of gathering the
required data. The respective quartile salary and total pay and benefits numbers are as follows:
Year
FY23
FY22
FY21
FY20
SALARY
TOTAL PAY AND BENEFITS
25th percentile
€27,603
€33,869
€27,762
€28,175
Median
€33,221
€53,642
€30,147
€30,596
75th percentile
25th percentile
€46,072
€47,200
€47,918
€48,632
€29,259
€35,945
€30,557
€31,013
Median
€35,214
€55,083
€33,086
€33,579
75th percentile
€48,837
€55,473
€53,052
€53,843
Strategic reportGovernance reportFinancial statementsOther information 156
Directors’ Remuneration Report CONTINUED
To provide a more robust comparison, data on a more Group wide employee basis is shown below, representing the workforce in our principal
countries of operations of the Netherlands, Belgium and the UK. For this set of employees data is based on basic salary and benefits excluding
bonus and share awards.
Year
FY23
Year
FY23
25th percentile pay ratio
Median pay ratio
75th percentile pay ratio
53 : 1
53 : 1
43 : 1
SALARY
TOTAL PAY AND BENEFITS
25th percentile
€35,532
Median
€35,271
75th percentile
25th percentile
€44,416
€40,176
Median
€47,491
75th percentile
€57,910
DIRECTORS’ INTERESTS (AUDITED)
The interests of the Directors and persons closely associated in the ordinary shares of the Group during the year and as at 25 May 2023 were as
shown below. Details of Directors’ interests in shares and options under the long-term share schemes are set out in the sections below.
Ordinary shares at 1 April 20211
Ordinary shares at 31 March 2023
and 25 May 2023
Otto de Bont
Allard Castelein
Neil Hartley
Jolande Sap
Luc Sterckx
Ben Verwaayen
Annemieke den Otter
Katleen Vandeweyer
102,874
–
–
–
28,500
–
–
–
1. Restated to reflect the 1:10 share consolidation in July 2021.
184,731
–
–
–
28,500
–
15,000
–
DIRECTORS’ SHAREHOLDINGS (AUDITED)
The table below shows the shareholding of each Executive Director, against their respective shareholding requirement as at 31 March 2023.
Owned
outright
or vested
Unvested
but subject
to holding
period
Unvested and
subject to
performance
conditions
Vested
but not
exercised
Exercised
during
the year
Unvested and
subject to
continuous
employment
Shareholding
requirement
(% of salary)
Current
shareholding1
(% of salary)
Otto de Bont
184,731
106,112
393,384
Annemieke den Otter
15,000
–
20,432
–
–
–
–
–
–
200%
200%
258%
24%
1. Shareholdings were calculated using the number of outright shares, at £6.07, as percentage of salary as at 31 March 2023.
Requirement
met?
Achieved
In progress
Renewi plcAnnual Report and Accounts 2023 157
DIRECTORS’ INTERESTS IN SHARE AWARDS
The Executive Directors have been made the following conditional awards under the Renewi Deferred Annual Bonus Plan:
Otto de Bont
Outstanding
awards at 31
March 2022
Awards
made during
the year1
Awards
lapsed during
the year
Awards
vested during
the year
Outstanding
awards at 31
March 2023
Date of award
Share price on
date of award
(£)
Restricted
period end
65,085
18,229
–
–
–
–
22,798
22,798
–
–
–
–
–
–
65,085
18,229
22,798
–
–
22,798
22.06.20
23.07.21
16.06.22
16.06.22
2.78
5.42
6.80
6.80
22.06.252
23.07.24
16.06.22
16.06.25
1. 50% of awards vesting immediately and 50% vest after three years.
2. Under legacy Scheme Rules 50% of award is released three years after the date of award, 25% after four years and the remaining 25% after five years.
The Executive Directors have been made the following conditional awards of shares under the Renewi Long-Term Incentive Plan:
Outstanding
awards at 31
March 2022
Awards
made during
the year
Awards
lapsed
during
the year
Awards
vested
during
the year1
Outstanding
awards at 31
March 20232
116,710
180,322
118,131
–
–
–
–
–
94,931
20,432
–
–
–
–
–
120,235
–
–
–
–
–
180,322
118,131
94,931
20,432
Date of
award
03.06.19
27.07.20
23.07.21
16.06.22
16.06.22
Share price
on date of
award (£)
Performance
period end
Restricted
period end3
3.45
2.58
5.24
6.80
6.80
31.03.22
31.03.23
03.06.22
27.07.23
31.03.24
23.07.24
31.03.25
16.06.25
31.03.25
16.06.25
Otto de Bont
Annemieke den Otter
1. 100% of the 2019 LTIP award vested in 2022. The award held by Otto de Bont was increased by an additional 3,525 shares in respect of dividend equivalents.
2. The performance conditions relating to the vesting of outstanding awards are shown on page 153.
3. A two-year post-vesting holding period applies.
The highest closing mid-market price of the ordinary shares
of Renewi plc during the year was £8.51 and the lowest closing
mid- market price during the year was £4.89. The mid-market
price at the close of business on 31 March 2023 was £6.07.
Mercer Ltd is a member of the Remuneration Consultants
Group and is a signatory to the Code of Conduct for
Remuneration Committees Consultants which can be found
at remunerationconsultantsgroup.com.
OTHER INTERESTS
None of the Directors had an interest in the shares of any subsidiary
undertaking of the Group or in any significant contracts of the Group.
ADVICE PROVIDED TO THE
COMMITTEE DURING THE YEAR
FIT Remuneration Consultants LLP (FIT) served as independent
advisers to the Remuneration Committee during the year up to
31 November 2022. Their total fees for the provision of remuneration
services to the Committee in FY23 were €9,204 (£8,012) charged
on a time and materials basis. FIT provided no other services to the
Group. Mercer Ltd was appointed by the Remuneration Committee
in December 2022 to provide independent advice on Remuneration
Policy including executive remuneration following a tender process.
Their total fees for the provision of remuneration services to the
Committee in FY23 were €57,183 (£49,750) charged on a time and
materials basis. Mercer Ltd provides no other services to the Group.
The Committee periodically undertakes due diligence to ensure that
the Remuneration Committee advisers remain independent of the
Group and that the advice provided is impartial and objective. The
Committee is satisfied that the advice provided is independent.
By order of the Board
Neil Hartley
Chair of the Remuneration Committee
25 May 2023
Strategic reportGovernance reportFinancial statementsOther information 158
Other disclosures
THE COMPANY’S ARTICLES OF ASSOCIATION
Many of the matters described below are governed by the Company’s
Articles of Association and also by current legislation and
regulations. The Articles can be viewed on the Company website
at renewi.com.
STRATEGIC REPORT
The Strategic report set out on pages 4 to 103 provides a fair review
of the Group’s business for the year ended 31 March 2023.
It also explains the objectives and strategy of the Group, its
competition and the markets in which it operates, the principal
risks and uncertainties it faces, the Group’s financial position,
key performance indicators and likely future developments
of the business.
The Strategic report was approved by a duly authorised
committee of the Board on 25 May 2023 and signed on its behalf
by the Company Secretary.
DIRECTORS’ REPORT
The Directors’ Report comprises pages 104 to 161. The Directors’
Report was approved by a duly authorised committee of the Board
on 25 May 2023 and signed on its behalf by the Company Secretary.
OTHER INFORMATION
Apart from the details of the Company’s Long-Term Incentive Plan,
as set out in the Directors’ Remuneration Report on pages 140 to 157,
no further information requires disclosure for the purposes of
complying with the Financial Conduct Authority’s Listing Rule 9.8.4C.
DIRECTORS
The composition of the Board at the date of this report can be found
on pages 106 to 107. Directors’ biographical details are also shown on
pages 106 to 107.
Annemieke den Otter was appointed Chief Financial Officer on
1 June 2022 following the resignation of Toby Woolrych on 31 March
2022 and was elected by shareholders at the 2022 AGM. Katleen
Vandeweyer was appointed as a Non-Executive Director and Chair
of the Audit Committee on 1 December 2022, following Marina
Wyatt’s stepping down from those positions at the conclusion of the
14 July 2022 AGM. Katleen Vandeweyer will be seeking election by
shareholders at the forthcoming AGM. All other Directors served on
the Board throughout the financial year under review and will be
seeking re-election at the AGM.
APPOINTMENT AND REPLACEMENT OF DIRECTORS
The Company’s minimum requirement is to appoint at least two
Directors. The appointment and replacement of Directors may
be made as follows:
• The Company’s members may, by ordinary resolution, appoint
any person who is willing to act to be a Director
• The Board may appoint any person who is willing to act to be
a Director. Any Director so appointed shall hold office only until
the next AGM and shall then be eligible for election
• Each Director shall retire from office at every AGM but may
be re-appointed by ordinary resolution if eligible and willing
• The Company may, by special resolution, remove any Director
before the expiry of his or her period of office or may, by ordinary
resolution, remove a Director where special notice has been given
and the necessary statutory procedures are complied with
• A Director must vacate their office if any of the circumstances
in Article 100 of the Articles of the Company arise
POWERS OF DIRECTORS
The business of the Company is managed by the Board, which may
exercise all the powers of the Company, whether relating to the
management of the business of the Company or not. This power
is subject to any limitations imposed on the Company by legislation.
It is also limited by the provisions of the Articles and by any
directions given by special resolution of the members of the
Company. Specific provisions relevant to the exercise of powers
by the Directors include the following:
• Pre-emptive rights and new issues of shares. Under the
Companies Act 2006 (the Act), the directors of a company are, with
certain exceptions, unable to allot any equity securities without
express authorisation, which may be contained in a company’s
Articles or given by its shareholders in a general meeting. In
addition, under the Act, the Company may not allot shares for cash
(otherwise than pursuant to an employee share scheme) without
first making an offer to existing shareholders to allot such shares
to them on the same or more favourable terms in proportion to
their respective shareholdings, unless this requirement is waived
by a special resolution of the Company’s shareholders. The
Company received authority at the last AGM to allot shares for cash
on a non-pre-emptive basis up to a maximum nominal amount of
£4,002,996. This authority lasts until the earlier of the AGM in 2023
or 30 September 2023
• Repurchase of shares. Subject to authorisation by shareholder
resolution, the Company may purchase all or any of its own shares
in accordance with the Act and the Listing Rules. Any shares that
have been bought back may be held as treasury shares or, if not
so held, must be cancelled immediately upon completion of the
purchase, thereby reducing the amount of the Company’s issued
share capital. The Company received authority at the last AGM to
purchase up to 8,005,993 ordinary shares. This authority lasts until
the earlier of the AGM in 2023 or 30 September 2023
• Borrowing powers. The Directors are empowered to exercise all
the powers of the Company to borrow money and to mortgage
or charge all or any part of the Company’s assets, provided that
the aggregate amount of borrowings of the Group outstanding
at any time does not exceed the limit set out in the Articles,
unless sanctioned by an ordinary resolution of the Company’s
shareholders
DIRECTORS’ INDEMNITIES
As at the date of this report, the Company has granted indemnities
to the extent permitted by law, in respect of certain liabilities
incurred as a result of carrying out the role of a Director of the
Company. The indemnities are qualifying third-party indemnity
provisions for the purposes of the Companies Act 2006.
In respect of those liabilities for which the Directors may not be
indemnified, the Company maintained a Directors’ and Officers’
liability insurance policy throughout the financial year and has
renewed that policy.
CORPORATE GOVERNANCE
The Board is fully committed to high standards of corporate
governance. Details relating to the Company’s compliance with the
Renewi plcAnnual Report and Accounts 2023 159
UK Corporate Governance Code for the financial year are given
in the Corporate Governance and Directors’ Remuneration Reports
on pages 112 to 157.
SUSTAINABILITY
Renewi plc is a leading international waste-to-product company.
Information on sustainability matters, including those on
environment, social, community and employment policies, and
health and safety, are set out in the Strategic report from page 4.
Further information about the Company’s approach to carbon
avoidance and the benefits of sustainable waste management,
including disclosures on Streamlined Energy and Carbon Reporting
(SECR) and Task Force on Climate-related Financial Disclosures
(TCFD), can also be found in the Sustainability Review, which will be
available on the Company’s website.
TASK FORCE ON CLIMATE-RELATED
FINANCIAL DISCLOSURES (TCFD)
The Group’s TCFD disclosure is provided in a readily identifiable and
accessible format for all interested stakeholders and can be found
on pages 59 to 65 of the Strategic report.
RESULTS AND DIVIDENDS
The Group’s Consolidated Income Statement, which appears on
page 172 and note 2 to the financial statements, shows the
contribution to revenue and profits made by the different segments
of the Group’s business. The Group’s profit for the year was €66.6m
(2022: profit of €75.4m). The Directors are not recommending a final
dividend (2022: 0 pence) be paid. Having determined not to pay an
interim dividend (2022: 0 pence), the total dividend for the year is nil
pence per share (2022: 0 pence). The Board has announced it
expects to be in a position to pay a dividend for FY24.
GOING CONCERN AND VIABILITY
After making enquiries, the Directors have formed the view, at the
time of approving the financial statements, that the Company and
Group have adequate resources to continue to operate and that the
Group’s business is a going concern. For this reason, the Directors
continue to adopt the going concern basis in preparing the financial
statements.
Taking account also of the Company’s current position and principal
risks, the Board sets out on page 100 how it has assessed the
prospects of the Company. In compliance with the provisions of the
UK Corporate Governance Code, the Board also confirms that it has a
reasonable expectation that the Company and the Group will be able
to continue in operation and meet their liabilities as they fall due
over the three-year period ending 31 March 2026.
SHARE CAPITAL
The Company’s share capital comprises ordinary shares of £1.00
each par value.
Renewi plc’s ordinary shares were admitted to trading on Euronext
Amsterdam on 30 January 2020. No new shares were placed in
connection with the application for that secondary listing and the
Company continues to remain listed on the premium segment
of the Official List in London.
Following shareholder approval at the 2021 AGM, on 19 July 2021
Renewi undertook a consolidation of its share capital on the basis
of 1 new ordinary share with nominal value of £1.00 for every
10 existing ordinary shares of 10 pence.
As at 31 March 2023 and as at the date of this report, there were
80,250,295 ordinary £1.00 shares in issue.
PRINCIPAL RIGHTS AND OBLIGATIONS
ATTACHING TO SHARES
• Dividend rights. The Company may, by ordinary resolution,
declare dividends but may not declare dividends in excess of the
amount recommended by the Directors. The Directors may also
pay interim dividends. No dividend may be paid other than out
of profits available for distribution. Payment or satisfaction of
a dividend may be made wholly or in part by distribution of assets,
including fully paid shares or debentures of any other company.
The Directors may deduct from any dividend payable to a member
all sums of money (if any) payable by such member to the
Company in respect of their ordinary shares
• Voting rights. On a poll, every shareholder who is present in
person or by proxy or represented by a corporate representative
has one vote for every share held by that shareholder. In the case
of joint holders of an ordinary share, the vote of the senior who
tenders a vote shall be accepted to the exclusion of the votes of the
other joint holders. Seniority is determined by the order in which
the names of the joint holders appear in the Company’s register
of members in respect of the joint holding. The deadline for
appointing proxies to exercise voting rights at any general meeting
is set out in the notice convening the relevant meeting. The
Company is not aware of any agreements between holders of
its shares that may result in restrictions on voting rights
• Return of capital. In the event of the liquidation of the Company,
after payment of all liabilities and deductions taking priority, the
balance of assets available for distribution will be distributed
among the holders of ordinary shares according to the amounts
paid up on the shares held by them. A liquidator may, with the
sanction of a special resolution of the shareholders and any other
sanction required by law, divide among the shareholders in kind
the whole or any part of the Company’s assets or vest the
Company’s assets, but no shareholder may be compelled
to accept any assets upon which there is any liability
SHARE RESTRICTIONS
There are no limitations under the Company’s Articles of Association
that restrict the rights of members to hold the Company’s shares.
Certain restrictions may, from time to time, be imposed on the
transfer of the Company’s shares by laws and regulations such
as insider trading laws. In limited situations, as permitted by the
Articles, the Board may also decline to register a transfer. The
Company is not aware of any agreements between holders of its
shares that may result in restrictions on the transfer of securities.
EMPLOYEE SHARE SCHEMES – CONTROL RIGHTS
The Company operates a number of employee share schemes.
Under some, ordinary shares may be held by trustees on behalf of
employees. Employees are not entitled to exercise directly any voting
or other control rights in respect of any shares held by such trustees.
Trustees have full discretion to vote or abstain from voting at general
meetings of the Company in respect of such shares.
Strategic reportGovernance reportFinancial statementsOther information 160
Other disclosures CONTINUED
RETAIL BONDS
As at 31 March 2023, the Company had in issue two retail bonds: the
first, comprising €75m 3.00% guaranteed notes due 19 July 2024; and
the second, comprising €125m 3.00% guaranteed notes due 23 July
2027. There are no restrictions under the instruments governing
these notes that restrict the rights of investors to hold or transfer
them. The Company is not aware of any agreements between the
holders of the notes that may result in restrictions on their transfer.
CHANGE OF CONTROL – SIGNIFICANT AGREEMENTS
The Group’s principal financing instruments at 31 March 2023 are a
€470m banking facility, consisting of a €400m multi-currency
revolving credit facility with seven major banks and €70m of
European Private Placement (EUPP) loans. The facility contains an
option for those lenders to declare by notice that all sums
outstanding under that agreement are repayable immediately in the
event of a change of control of the Company. Any such notice may
take effect no earlier than 30 days from the change of control and, if
exercised at 31 March 2023, would have required the repayment of
€102.5m (FY22: €15.0m) in principal and interest relating to the
revolving credit facility, along with a make-whole payment
amounting to €0.0m (FY22: €0.7m).
The Group’s European Investment Bank (EIB) financing instrument of
€40m requires notice to be given if a change of control event has
occurred or is likely to occur, and subsequently they may cancel any
unutilised loan amounts and demand prepayment of any loan
outstanding, along with accrued interest and other amounts
accrued. As at 31 March 2023 the unutilised loan amount was €15.0m
(FY22: n/a) and the loan outstanding and interest accrued was
€25.3m (FY22: n/a).
The Group’s retail bonds issued in July 2019 and July 2021 require
notice to be given to bondholders within seven business days of a
change of control following which the holders have an option to seek
repayment at a 1% premium, within 60 days of that notice. Such
repayment must be made within 10 business days of the expiry of the
option period. If exercised at 31 March 2023, repayment of €204.1m
(FY22: €307.0m) in principal and interest would have been required.
The rules of the Company’s employee share plans provide that
awards and options may vest and become exercisable on a change
of control of the Company.
RESEARCH AND DEVELOPMENT
The Group spent €204k (FY22: €203k) on research and development
in the year. This related to a research and development of the
products at our Coolrec business, an award-winning full range
recycler and secondary raw materials supplier. You can read more
about the work at Coolrec, and its partnership with Playmobil, in the
Strategic Report.
POLITICAL DONATIONS
No donations were made by the Group for political purposes during
the financial year (FY22: £nil).
NOTIFIABLE INTERESTS
The Company has been notified of direct and indirect interests in
voting rights equal to or exceeding 3% of the ordinary share capital
of the Company as set out in the table below.
Avenue Europe International
Management LP
Coast Capital Management
SPICE ONE Investment Cooperatief U.A.
Black Rock inc.
Janus Henderson Investors
NOTIFICATIONS RECEIVED
UP TO 25 MAY 2023
Number of
shares
% issued
capital
6,615,426
4,819,283
4,482,393
3,187,584
2,451,499
8.24
6.01
5.59
3.97
3.06
INVESTOR RELATIONS
Renewi has an active investor relations programme to engage with
institutional investors, analysts, press and other stakeholders.
The Company uses a number of channels to do this including its
AGM, face-to-face meetings, roadshows, analyst workshops, videos,
presentations, reports and its corporate website.
ANNUAL GENERAL MEETING
Notice of the AGM of the Company to be held at the offices of Ashurst
LLP, The London Fruit & Wool Exchange, 1 Duval Square, London, E1
6PW on Thursday, 13 July 2023 at 11.00am will be made available to
shareholders, together with a form of proxy, and will also be
available on the Company’s website at renewi.com. Details on how
to participate will be made available to shareholders and will also be
available on the Company’s website at renewi.com.
The Directors consider that all the AGM resolutions are in the best
interests of the Company, and they recommend unanimously that all
shareholders vote in favour, as they intend to in respect of their own
shareholdings.
By order of the Board
Philip Griffin-Smith
Company Secretary
25 May 2023
Renewi plc, Registered in Scotland no. SC077438
Renewi plcAnnual Report and Accounts 2023
161
Directors’ responsibilities
statement
DIRECTORS’ RESPONSIBILITIES PURSUANT
TO DTR4 OF THE UK LISTING RULES
The Directors confirm to the best of their knowledge:
• The financial statements have been prepared in accordance with
the applicable set of accounting standards and give a true and fair
view of the assets, liabilities, financial position and profit and loss
of the Group and Company
• The Annual Report includes a fair review of the development and
performance of the business and the financial position of the
Group and Company, together with a description of the principal
risks and uncertainties that they face
DIRECTORS’ STATEMENT AS TO THE DISCLOSURE
OF INFORMATION TO AUDITORS
All of the current Directors have taken all the steps that they ought
to have taken to make themselves aware of any information needed
by the Company’s auditors for the purposes of their audit and
to establish that the auditors are aware of that information. The
Directors are not aware of any relevant audit information of which
the auditors are unaware.
By order of the Board
Philip Griffin-Smith
Company Secretary
25 May 2023
Renewi plc, Registered in Scotland no. SC077438
The Directors are responsible for preparing the Annual Report
and the financial statements in accordance with UK adopted
international accounting standards and applicable law
and regulations.
Company law requires the Directors to prepare financial statements
for each financial year. Under that law the Directors are required to
prepare the Group financial statements and have elected to prepare
the Company financial statements in accordance with UK adopted
international accounting standards. Under company law the
Directors must not approve the financial statements unless they are
satisfied that they give a true and fair view of the state of affairs
of the Group and Company and of the profit or loss for the Group
and Company for that period.
In preparing these financial statements, the Directors are required to:
• select suitable accounting policies and then apply
them consistently;
• make judgements and accounting estimates that are reasonable
and prudent;
• state whether they have been prepared in accordance with
UK adopted international accounting standards, subject
to any material departures disclosed and explained in the
financial statements;
• prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and the
Company will continue in business; and
• prepare a Directors’ Report, a Strategic report and Directors’
Remuneration Report which comply with the requirements
of the Companies Act 2006.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company’s
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities. The Directors are
responsible for ensuring that the Annual Report and Accounts, taken
as a whole, are fair, balanced and understandable, and provide the
information necessary for shareholders to assess the Group’s
performance, business model and strategy.
WEBSITE PUBLICATION
The Directors are responsible for ensuring the Annual Report
and the financial statements are made available on a website.
Financial statements are published on the Company’s website
in accordance with legislation in the United Kingdom governing
the preparation and dissemination of financial statements,
which may vary from legislation in other jurisdictions. The
maintenance and integrity of the Company’s website is the
responsibility of the Directors. The Directors’ responsibility also
extends to the ongoing integrity of the financial statements
contained therein.
Strategic reportGovernance reportFinancial statementsOther information FINANCIAL
STATEMENTS
Secondary material
Commercial Waste NL, Minerals from
demolition waste, used as a secondary
material for the construction industry
164
Independent auditor’s
report to the members
of Renewi plc
OPINION ON THE FINANCIAL STATEMENTS
In our opinion:
• the financial statements give a true and fair view of the state of the
Group’s and of the Parent Company’s affairs as at 31 March 2023
and of the Group’s profit for the year then ended;
• the Group financial statements have been properly prepared in
accordance with UK adopted international accounting standards;
• the Parent Company financial statements have been properly
prepared in accordance with UK adopted international accounting
standards and as applied in accordance with the provisions of the
Companies Act 2006; and
• the financial statements have been prepared in accordance with
the requirements of the Companies Act 2006.
We have audited the financial statements of Renewi Plc (the ‘Parent
Company’) and its subsidiaries (the ‘Group’) for the year ended 31
March 2023 which comprise the Consolidated Income Statement, the
Consolidated Statement of Comprehensive Income, the
Consolidated Balance Sheet, the Consolidated Statement of
Changes in Equity, the Consolidated Statement of Cash Flows, the
Parent Company Balance Sheet, the Parent Company Statement of
Changes in Equity, the Parent Company Statement of Cash Flows
and notes to the financial statements, including a summary of
significant accounting policies. The financial reporting framework
that has been applied in their preparation is applicable law and UK
adopted international accounting standards and as regards the
Parent Company financial statements, as applied in accordance with
the provisions of the Companies Act 2006.
BASIS FOR OPINION
We conducted our audit in accordance with International Standards
on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities
under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section
of our report. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our opinion.
Our audit opinion is consistent with the additional report to the
audit committee.
Independence
Following the recommendation of the audit committee, we were
appointed by the Directors on 22 October 2020 to audit the financial
statements for the year ended 31 March 2021 and subsequent
financial periods. The period of total uninterrupted engagement
including retenders and reappointments is three years, covering the
years ended 31 March 2021 to 31 March 2023. We remain independent
of the Group and the Parent Company in accordance with the ethical
requirements that are relevant to our audit of the financial
statements in the UK, including the FRC’s Ethical Standard as applied
to listed public interest entities, and we have fulfilled our other
ethical responsibilities in accordance with these requirements. The
non-audit services prohibited by that standard were not provided to
the Group or the Parent Company.
During the year we became aware of a breach of the FRC’s Ethical
Standard relating to a permitted non-audit service performed by
BDO Belgium to a controlled subsidiary of Renewi plc, which was not
reported as a non-audit service in FY2022. Consequently, this did not
receive Audit Committee pre-approval of Audit Partner approval, as
required, and as such was a breach of Paragraph 5.40 of the FRC’s
Ethical Standard. Our assessment of the breach is that our
independence has not been compromised as the service was
performed by a team in a separate BDO firm, the fees for the service
are insignificant (€2.2k), the service was permitted under the Ethical
Standard and the service did not give rise to any self-review or
management threats. We therefore believe that actual threats to
independence were insignificant, and this inadvertent breach did not
compromise our independence as auditors for FY2022 and that the
objective, reasonable and informed third party would also concur
with this conclusion.
CONCLUSIONS RELATING TO GOING CONCERN
In auditing the financial statements, we have concluded that the
Directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate.
Our evaluation of the Directors’ assessment of the Group and Parent
Company’s ability to continue to adopt the going concern basis of
accounting included:
• Review of the Directors’ going concern assessment, forecasts and
forecast covenants compliance for the Group and Parent Company
for a period of at least 12 months from the date of approval of the
financial statements;
• Evaluation of the relevance and reliability of the underlying data
used to make the assessment, including consideration of
consistency of the data used for other forecasts by management in
preparation of the financial statements and review of historical
accuracy of forecasts;
• Understood and challenged the Directors’ rationale for selection of
assumptions and changes in assumptions from prior periods, as
well as considering if alternative assumptions should be included
in sensitivity analysis. Key assumptions within the going concern
models include expectations of recyclate prices and volumes
of waste; and
• Consideration of the completeness of sector and macro-economic
factors, and their effect on expected covenant compliance and
cash flows, in the base, downside and reverse stress tested models.
In particular, we considered inflation, impact of energy costs,
impact of Renewi 2.0 cost savings, interest rates and volume
reduction.
Renewi plcAnnual Report and Accounts 2023 165
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the Group
and the Parent Company’s ability to continue as a going concern for
a period of at least twelve months from when the financial
statements are authorised for issue.
In relation to the Parent Company’s reporting on how it has applied
the UK Corporate Governance Code, we have nothing material to
add or draw attention to in relation to the Directors’ statement in the
financial statements about whether the Directors considered it
appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with
respect to going concern are described in the relevant sections of
this report.
AN OVERVIEW OF THE SCOPE OF OUR AUDIT
Our Group audit was scoped by obtaining an understanding of the
Group and its environment, including the Group’s system of internal
control, and assessing the risks of material misstatement in the
financial statements. We also addressed the risk of management
override of internal controls, including assessing whether there was
evidence of bias by the Directors that may have represented a risk of
material misstatement.
We identified components which we considered to be of individual
financial significance based on their contribution to the Group’s
earnings, those which were significant due to risk and those
remaining components on which we required procedures to be
performed to provide us with the evidence to conclude on the group
financial statements as a whole. Our scoping and number of
components is as follows:
OVERVIEW
Coverage
Key audit matters
• 87% (2022: 90%) of Group profit before tax
• 91% (2022: 98%) of Group revenue
• 91% (2022: 94%) of Group total assets
2023
2022
Revenue recognition
Valuation of onerous contract provisions
Valuation of landfill provisions
Provision for ongoing legal matters*
Provision for ongoing legal matters is no longer considered to be a key audit matter due
to the decision of the European Commission on 3 March 2023 that State Aid was not
provided by the Belgian Walloon Region to Renewi Valorisation and Quarry NV, therefore
the largest provision recognised for ongoing legal matters was released as disclosed in
note 3.3 to the financial statements. The remaining provisions are relating to significantly
lower exposure matters in terms of possible economic outflow.
Materiality
Group financial statements as a whole
• €6.20m (2022: €6.51m) based on 5% (2022:
5%) of underlying earnings before interest
and tax (EBIT).
NUMBER OF COMPONENTS
FY23
FY22
Full scope components
Audit of one or more account balances
Total
6
3
9
6
3
9
The 6 significant components contributed 91% of Group profit before
tax (on absolute basis), 90% of revenue and 78% total assets. These
components were subject to full scope audit procedures by the
following teams:
• Commercial Waste Netherlands, Commercial Waste Belgium, ATM
and Group Central Services – Eindhoven completed by BDO
member firm component auditors.
• UK Municipal – completed by BDO LLP component auditor.
• Group Central Services – Milton Keynes completed by BDO LLP
group team.
We also instructed BDO member firms to perform specified
procedures, designed by the Group audit team to address risks of
material misstatement, on certain key balances in entities that
formed part of non-significant components.
Our involvement with component auditors
For the work performed by component auditors, we determined the
level of involvement needed in order to be able to conclude whether
sufficient appropriate audit evidence has been obtained as a basis
for our opinion on the Group financial statements as a whole. Our
involvement with component auditors included the following:
• Regular progress calls with all component audit teams present to
discuss audit approach and then subsequently audit progress and
evaluation of procedures performed on key audit matters;
• Issued group audit instructions to components auditors, detailing
Strategic reportGovernance reportFinancial statementsOther information
166
Independent auditor’s report to the members of Renewi plc CONTINUED
the scope of their work, significant and elevated risks and
component materiality;
• Review of group reporting submissions from components;
• In person all-teams planning day to direct component audit teams’
We challenged the extent to which climate-related considerations,
including the expected cash flows from the initiatives and
commitments have been reflected, where appropriate, in the
Directors’ going concern assessment and viability assessment.
We also assessed the consistency of management’s disclosures
included as Other Statutory Information on page 158 with the
financial statements and with our knowledge obtained from
the audit.
Based on our risk assessment procedures, we did not identify there
to be any Key Audit Matters materially impacted by climate-related
risks and related commitments.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) that we identified, including those which had the greatest
effect on: the overall audit strategy, the allocation of resources in the
audit, and directing the efforts of the engagement team. These
matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
planning and discuss risks identified;
• Group audit team performed a detailed review of the component
auditors’ working papers to determine if sufficient and appropriate
audit evidence had been obtained; and
• Attended physical clearance meetings for each significant
component, together with local management and the
component auditor.
The Group audit team also performed audit procedures on
elements of certain specific risks including determination of discount
rate used in calculation of onerous contract provisions and landfill
provisions; stand back on management override of controls and
presentation of non-trading and exceptional items within Statement
of Comprehensive Income and impact of inflation across the
financial statements.
Climate change
Our work on the assessment of potential impacts on climate-related
risks on the Group’s operations and financial statements included:
• Enquiries and challenge of management to understand the actions
they have taken to identify climate-related risks and their potential
impacts on the financial statements and adequately disclose
climate-related risks within the annual report;
• Our own qualitative risk assessment taking into consideration the
sector in which the Group operates and how climate change
affects this particular sector; and
• Review of the minutes of Board and Audit Committee meeting and
other papers related to climate change and performed a risk
assessment as to how the impact of the Group’s commitment as
set out in the Strategic Report may affect the financial statements
and our audit.
KEY AUDIT MATTER
HOW THE SCOPE OF OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Revenue recognition – Section 3.1
We consider that there is a risk that revenue
recognition is inappropriate as there may
be incentive for management to meet
market and investor expectations. This
incentive could lead to manipulation of
revenue recognised, by manual journals or
bias in estimates of value and volume of
deferred revenue (unprocessed waste) at
year end. Deferred revenue is recognised in
a number of components as performance
obligations are completed after billing and
cut-off could be inappropriately applied. As
there is some judgement involved in the
valuation of this deferred revenue, we
considered revenue recognition to be a key
audit matter.
Our procedures included the following:
We tested the operating effectiveness of controls relating to the following:
• Determining that weight registrations cannot be deleted;
• Obtaining assurance over accuracy of calibration of weigh registrations; and
• Checking that interfaces between weight registrations and accounting system are accurately
capturing information.
Other detailed procedures included:
• Evaluated the scope, competence and objectivity of management’s external experts, who measure
the mass balance of unprocessed waste at year end;
• Attended waste counts at a number of locations and verified that these were appropriately
reflected in deferred revenue calculations;
• Assessed if conversion rates for volumes/density were appropriate by comparison to
external sources;
• Agreed prices of waste sold & collected to underlying supporting documentation or contracts to
provide assurance of accuracy and valuation of deferred revenue;
• Selected manual journals to revenue outside of expectation and verified to
supporting documentation;
• Selected a sample of transactions either side of the year end and agreed to supporting
documentation to check that revenue has not been recognised prior to performance obligation
being satisfied; and
• Performed analytical procedures to identify, among other matters, inconsistencies in gross profit
margin achieved in prior periods compared to that reported in March 2023.
Key observations:
Based on the testing completed, we are satisfied that revenue recognition was appropriate for the
year ended 31 March 2023.
Renewi plcAnnual Report and Accounts 2023 167
KEY AUDIT MATTER
HOW THE SCOPE OF OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Valuation of onerous contract
provisions
Carrying value €141.9m,
– Section 4.10
Provisions are recognised for onerous
contracts which involve significant
estimation uncertainty and can be
susceptible to significant value changes
based on small changes in assumptions.
The provisions are based on medium-long
term time horizons (5 – 17 years) and are
often influenced by market factors that are
outside of management’s control (eg
recyclate prices or cost inflation).
We considered the valuation of these
provisions and associated disclosure to
represent a key audit matter.
Valuation of landfill provisions
Carrying value €164.5m, – Section
4.10
The Group incurs constructive and legal
obligations for restoration and aftercare
activities for landfill sites in a number of
locations. The estimation of future costs
involves uncertainty, and the time period
for these costs ranges up to 60 years,
therefore the effect of the time value of
money is material. The restoration and
environmental remediation activities are
governed by certain legislative
requirements which vary between location
and stage of operation of the landfill site.
The estimation of these provisions, together
with the related disclosure, was considered
to be a key audit matter due to the
significant value of the provisions and
significant judgements and assumptions
made by management to determine:
• The future costs;
• The nature and timing of the costs; and
• The discount rate to apply to calculate
the provisions.
Our procedures included the following:
• Obtained the onerous contract models used to determine the carrying value of provisions and
applied our own proprietary data analytics tools to interrogate the accuracy and integrity of
those models;
• Discussed with divisional management the process used to update onerous contract
model assumptions, to understand the rigour and expertise involved in building up the
cash flow forecasts;
• Assessed the appropriateness of discount rates used by comparison with government bond yields
over a consistent timeframe, benchmarking and assistance of our internal valuation experts;
• Considered management’s forecasting ability in light of actual outturn versus historical forecasting;
• Considered the consistency of onerous contract modelling with the forecasts used in other areas;
• Corroborated assumptions used in the models, including forecast tonnage with historical actuals
and recyclate pricing on variable revenue streams to recently achieved levels as well as
corroboration of inflation assumptions to published expectations of inflation;
• Performed sensitivity analysis on key inputs (notably recyclate pricing, discount rates and volumes
of waste processed), in order to understand how sensitive the model is to these inputs; and
• Considered the appropriateness of the sensitivity disclosures included in the notes to the financial
statements in connection with the onerous contracts in line with the requirements of the applicable
accounting framework.
Key observations:
Based on the testing performed, we believe that the Group’s estimate of the onerous contract
provision falls within an acceptable range as at 31 March 2023 and that the related disclosures are
appropriate.
Our procedures included the following:
• Evaluated the scope, competence and objectivity of management’s external experts, who assist
with determining cost estimates and volumes;
• Compared previous forecast assumptions to actual costs incurred to assess the ability of
management to accurately forecast closure costs;
• With the assistance of our internal valuations experts we evaluated the discount rates used and
verified data to government bond yields. We also compared the discount rates to external market
research;
• Assessed the appropriateness of differences in assumptions between landfill sites including timing
of costs considered;
• Enquired with our external auditor’s experts to identify if there were any regulatory updates that
could impact the provisions as well as benchmarking cost assumptions in order to determine if
these were within an appropriate range;
• Considered completeness of disclosure, including sensitivity of provisions to changes in key
assumptions and the estimation uncertainty involved in the determination of the discount rate in
line with the requirements of the applicable accounting framework.
Key observations:
Based on the procedures performed, we believe that the Group’s estimate of the landfill provisions
falls within an acceptable range at 31 March 2023 and that the related disclosures are appropriate.
Strategic reportGovernance reportFinancial statementsOther information 168
Independent auditor’s report to the members of Renewi plc CONTINUED
OUR APPLICATION OF MATERIALITY
We apply the concept of materiality both in planning and performing
our audit, and in evaluating the effect of misstatements. We consider
materiality to be the magnitude by which misstatements, including
omissions, could influence the economic decisions of reasonable
users that are taken on the basis of the financial statements.
In order to reduce to an appropriately low level the probability that
any misstatements exceed materiality, we use a lower materiality
level, performance materiality, to determine the extent of testing
needed. Importantly, misstatements below these levels will not
necessarily be evaluated as immaterial as we also take account of
the nature of identified misstatements, and the particular
circumstances of their occurrence, when evaluating their effect on
the financial statements as a whole.
Based on our professional judgement, we determined materiality
for the financial statements as a whole and performance materiality
as follows:
GROUP FINANCIAL STATEMENTS
PARENT COMPANY FINANCIAL STATEMENTS
2023 €M
2022 €M
2023 €M
2022 €M
Materiality
6.20
6.51
5.35
13.00
Basis for determining
materiality
5% underlying EBIT
5% underlying EBIT
98% of Group materiality
2% of net assets
Rationale for the
benchmark applied
The Group is profit-seeking, therefore a profit-based
measure is considered to be most appropriate.
Materiality was capped at
98% of Group materiality
to take into account
component aggregation
risk.
Net assets is considered to
be the primary measure
that shareholders would
review in assessing the
performance of the Parent
Company.
Performance
materiality
Basis for determining
performance
materiality
Rationale for the
percentage applied for
performance
materiality
4.30
4.56
3.40
9.10
70% of overall materiality.
70% of overall materiality.
The percentage applied was determined after consideration of factors including the level of past misstatements, value of
brought forward adjustments, management’s attitude toward proposed adjustments and number of accounts that are
subject to estimation.
Component materiality
For the purposes of our Group audit opinion, we set materiality for
each significant component of the Group, apart from the Parent
Company whose materiality is set out above, based on a percentage
of between 19% and 89% (2022: 18% and 86%) of Group materiality
dependent on the size and our assessment of the risk of material
misstatement of that component. Component materiality ranged
from €1.2m to €5.5m (2022: €1.2m to €5.6m). In the audit of each
component, we further applied performance materiality levels of
70% (2022: 70%) of the component materiality to our testing to
ensure that the risk of errors exceeding component materiality was
appropriately mitigated.
Reporting threshold
We agreed with the Audit Committee that we would report to them
all individual audit differences in excess of €0.24m (2022: €0.13m).
We also agreed to report differences below this threshold that, in our
view, warranted reporting on qualitative grounds.
Renewi plcAnnual Report and Accounts 2023 OTHER INFORMATION
The directors are responsible for the other information. The other
information comprises the information included in the Annual
Report and Accounts other than the financial statements and our
auditor’s report thereon. Our opinion on the financial statements
does not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express any
form of assurance conclusion thereon. Our responsibility is to read
the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements
or our knowledge obtained in the course of the audit, or otherwise
appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material
misstatement in the financial statements themselves. If, based on
the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report
that fact.
We have nothing to report in this regard.
CORPORATE GOVERNANCE STATEMENT
The Listing Rules require us to review the Directors’ statement in
relation to going concern, longer-term viability and that part of the
Corporate Governance Statement relating to the parent company’s
compliance with the provisions of the UK Corporate Governance
Code specified for our review.
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements or our knowledge obtained during the audit
Going concern
and longer-
term viability
Other Code
provisions
• The Directors’ statement with regards to the
appropriateness of adopting the going concern
basis of accounting and any material
uncertainties identified set out on page 100;
and
• The Directors’ explanation as to their
assessment of the Group’s prospects, the
period this assessment covers and why the
period is appropriate set out on page 100.
• Directors’ statement on fair, balanced and
understandable set out on page 135;
• Board’s confirmation that it has carried out a
robust assessment of the emerging and
principal risks set out on page 120;
• The section of the annual report that describes
the review of effectiveness of risk management
and internal control systems set out on page
120; and
• The section describing the work of the audit
committee set out on page 132.
169
OTHER COMPANIES ACT 2006 REPORTING
Based on the responsibilities described below and our work
performed during the course of the audit, we are required by the
Companies Act 2006 and ISAs (UK) to report on certain opinions
and matters as described below. .
Strategic
report and
Directors’
report
In our opinion, based on the work undertaken in
the course of the audit:
• the information given in the Strategic report
and the Directors’ report for the financial year
for which the financial statements are prepared
is consistent with the financial statements; and
• the Strategic report and the Directors’ report
have been prepared in accordance with
applicable legal requirements.
In the light of the knowledge and understanding
of the Group and Parent Company and its
environment obtained in the course of the audit,
we have not identified material misstatements in
the Strategic report or the Directors’ report.
Directors’
remuneration
In our opinion, the part of the Directors’
remuneration report to be audited has been
properly prepared in accordance with the
Companies Act 2006.
Corporate
governance
statement
Matters on
which we are
required to
report by
exception
In our opinion, based on the work undertaken in
the course of the audit the information about
internal control and risk management systems in
relation to financial reporting processes and
about share capital structures, given in
compliance with rules 7.2.5 and 7.2.6 in the
Disclosure Guidance and Transparency Rules
sourcebook made by the Financial Conduct
Authority (the FCA Rules), is consistent with the
financial statements and has been prepared in
accordance with applicable legal requirements.
In the light of the knowledge and understanding
of the Group and the Parent Company and its
environment obtained in the course of the audit,
we have not identified material misstatements in
this information.
In our opinion, based on the work undertaken in
the course of the audit information about the
Parent Company’s corporate governance code
and practices and about its administrative,
management and supervisory bodies and their
committees complies with rules 7.2.2, 7.2.3 and
7.2.7 of the FCA Rules.
We have nothing to report arising from our
responsibility to report if a corporate governance
statement has not been prepared by the Parent
Company.
We have nothing to report in respect of the
following matters in relation to which the
Companies Act 2006 requires us to report to you
if, in our opinion:
• adequate accounting records have not been
kept by the Parent Company, or returns
adequate for our audit have not been received
from branches not visited by us; or
• the Parent Company financial statements and
the part of the Directors’ remuneration report
to be audited are not in agreement with the
accounting records and returns; or
• certain disclosures of Directors’ remuneration
specified by law are not made; or
• we have not received all the information and
explanations we require for our audit.
Strategic reportGovernance reportFinancial statementsOther information 170
Independent auditor’s report to the members of Renewi plc CONTINUED
EUROPEAN SINGLE ELECTRONIC FORMAT (ESEF)
The Annual Report and Accounts of Renewi plc, have been prepared
in single electronic reporting format (ESEF), pursuant to the
Commission Delegated Regulation (EU) 2019/815 of 17 December
2018, supplementing Directive 2004/109/EC of the European
Parliament and the Council. The requirements to be met are set out
in the aforementioned delegated regulation (these requirements are
hereinafter referred to as: the RTS on ESEF).
Extent to which the audit was capable of detecting irregularities,
including fraud
Irregularities, including fraud, are instances of non-compliance with
laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements in
respect of irregularities, including fraud. The extent to which our
procedures are capable of detecting irregularities, including fraud is
detailed below:
In our opinion, the Annual Report and Accounts, made up in XHTML
format, including the tagged consolidated financial statements as
included in the reporting package by Renewi plc, have been
prepared in all material aspects in accordance with the RTS on ESEF.
Management is responsible for preparing the Annual Report and
Accounts, including the financial statements, in accordance with the
RTS on ESEF, whereby management combines the various
components in a reporting package. Our responsibility is to obtain
reasonable assurance for our conclusion on whether the Annual
Report and Accounts in this reporting package, is in accordance with
the requirements. We have taken into consideration what is stated in
Alert 43.
Our procedures included:
• Obtaining an understanding of the entity’s financial reporting
process, including the preparation of the annual financial report in
XHTML-format;
• Obtaining the reporting package and performing validations to
determine whether the reporting package containing the inline
XBRL instance document and XBRL extension taxonomy files have
been prepared in accordance with the technical specifications; and
• Examining the information related to the consolidated financial
statements in the reporting package to determine whether all
required taggings have been applied and whether they are in
accordance with the RTS on ESEF.
RESPONSIBILITIES OF DIRECTORS
As explained more fully in the Directors’ responsibilities statement,
the Directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view,
and for such internal control as the Directors determine is necessary
to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible
for assessing the Group’s and the Parent Company’s ability to
continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the Group
or the Parent Company or to cease operations, or have no realistic
alternative but to do so.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE
FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
Non-compliance with laws and regulations
Based on our understanding of the Group and the industry in which
it operates, discussion with management, internal Legal Counsel,
internal audit and those charged with governance and obtaining an
understanding of the Group’s policies and procedures regarding
compliance with laws and regulations we have considered the
significant laws and regulations to be:
• UK adopted international accounting standards
• UK, Dutch & Belgian tax legislation
• Listing Rules of the Financial Conduct Authority;
• The Companies Act 2006; and
• EU regulation regarding landfill and related taxes.
The Group is also subject to laws and regulations where the
consequence of non-compliance could have a material effect on the
amount or disclosures in the financial statements, for example
through the imposition of fines or litigations. We identified such laws
and regulations to be:
• Health & Safety regulations
• Employment law; and
• Bribery Act.
Our procedures in respect of the above included:
• Review of minutes of meetings of those charged with governance
for material instances of non-compliance with laws and
regulations;
• Review of internal audit reports (“Integrity reports”) during the year
to identify material reports of non-compliance with laws and
regulations;
• Review of correspondence with regulatory and tax authorities for
material instances of non-compliance with laws and regulations;
• Review of financial statement disclosures and agreeing to
supporting documentation;
• Involvement of tax specialists in the audit to assist with
quantification of uncertain tax positions, deferred and current tax
positions; and
• Engaged local, external legal professionals to provide information
on latest laws or regulations that could impact the Group.
Fraud
We assessed the susceptibility of the financial statements to material
misstatement, including fraud. Our risk assessment procedures
included:
• Enquiry with management and those charged with governance
regarding any known or suspected instances of fraud;
• Obtaining an understanding of the Group’s policies and procedures
relating to:
– Detecting and responding to the risks of fraud; and
– Internal controls established to mitigate risks related to fraud.
• Review of minutes of meeting of those charged with governance
for any known or suspected instances of fraud;
• Discussion amongst the engagement team as to how and where
fraud might occur in the financial statements;
• Performing analytical procedures to identify any unusual or
unexpected relationships that may indicate risks of material
Renewi plcAnnual Report and Accounts 2023 171
misstatement due to fraud;
• Involvement of forensic specialists in the audit to assist in our risk
assessment relating to fraud; and
• Considering remuneration incentive schemes and performance
targets and the related financial statement areas impacted by
these.
We have considered the incentives and opportunities of
management to carry out fraudulent financial reporting (including
override of controls) and determined that the principal risks relate to
management bias in determining accounting estimates and
judgements (the most significant of which are outlined in our key
audit matters above) and through the recording of inappropriate
journal entries.
Our audit procedures were designed to respond to risks of material
misstatement in the financial statements, recognising that the risk of
not detecting a material misstatement due to fraud is higher than the
risk of not detecting one resulting from error, as fraud may involve
deliberate concealment by, for example, forgery, misrepresentations
or through collusion. There are inherent limitations in the audit
procedures performed and the further removed non-compliance with
laws and regulations is from the events and transactions reflected in
the financial statements, the less likely we are to become aware of it.
A further description of our responsibilities is available on the
Financial Reporting Council’s website at: www.frc.org.uk/
auditorsresponsibilities. This description forms part of our auditor’s
report.
Our procedures in respect of the above included:
• Testing of a sample of journal entries throughout the year, which
met a defined risk criteria, by agreeing to supporting
documentation;
• Detailed verification of consolidation level journal entries through
enquiry with management and corroboration to supporting
documents where relevant; and
• Assessing significant estimates made by management for bias,
refer to key audit matters 2 and 3 for detail on audit procedures
relating to the most significant estimates.
USE OF OUR REPORT
This report is made solely to the Parent Company’s members, as a
body, in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might state to
the Parent Company’s members those matters we are required to state
to them in an auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to
anyone other than the Parent Company and the Parent Company’s
members as a body, for our audit work, for this report, or for the
opinions we have formed.
We also communicated relevant identified laws and regulations and
potential fraud risks to all engagement team members (including
component engagement teams) who were all deemed to have
appropriate competence and capabilities and remained alert to any
indications of fraud or non-compliance with laws and regulations
throughout the audit. For component engagement teams, we also
reviewed the result of their work performed in this regard.
Mark Cardiff
Senior Statutory Auditor
For and on behalf of BDO LLP, Statutory Auditor
London, UK
25 May 2023
BDO LLP is a limited liability partnership registered in England and Wales (with registered
number OC305127).
Strategic reportGovernance reportFinancial statementsOther information 172
Consolidated Income Statement
For the year ended 31 March 2023
Revenue
Cost of sales
Gross profit (loss)
Administrative expenses
Operating profit (loss)
Finance income
Finance charges
Share of results from associates
and joint ventures
Profit (loss) before taxation
Taxation
Profit (loss) for the year
Attributable to:
Owners of the parent
Non-controlling interests
Earnings per share
Basic
Diluted
Underlying basic
Underlying diluted
Note
2,3.1
3.3
Underlying
€m
1,892.3
(1,530.0)
3.3
2
5.4
5.4
4.4
3.4
5.9
362.3
(229.4)
132.9
9.8
(39.0)
–
103.7
(28.1)
75.6
71.9
3.7
75.6
2023
Non-trading
& exceptional
items
€m
2022
Non-trading
& exceptional
items
€m
Total
€m
Underlying
€m
–
1,892.3
(28.6)
(28.6)
17.1
(11.5)
0.9
–
–
(10.6)
1.6
(9.0)
(9.0)
–
(9.0)
(1,558.6)
333.7
(212.3)
121.4
10.7
(39.0)
–
93.1
(26.5)
66.6
62.9
3.7
66.6
1,869.2
(1,512.5)
356.7
(223.1)
133.6
9.3
(38.2)
0.5
105.2
(26.4)
78.8
77.9
0.9
78.8
Note
3.5
3.5
3.5
3.5
–
0.1
0.1
(9.7)
(9.6)
0.2
(0.1)
–
(9.5)
6.1
(3.4)
(3.4)
–
(3.4)
2023
cents
79
79
90
90
Total
€m
1,869.2
(1,512.4)
356.8
(232.8)
124.0
9.5
(38.3)
0.5
95.7
(20.3)
75.4
74.5
0.9
75.4
2022
cents
93
93
98
98
The notes on pages 177 to 246 are an integral part of these consolidated financial statements.
Renewi plcAnnual Report and Accounts 2023
173
Consolidated Statement of Comprehensive Income
For the year ended 31 March 2023
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign subsidiaries
Fair value movement on cash flow hedges
Deferred tax on fair value movement on cash flow hedges
Share of other comprehensive income of investments accounted for using the equity method
Items that will not be reclassified to profit or loss:
Actuarial (loss) gain on defined benefit pension schemes
Deferred tax on actuarial (loss) gain on defined benefit pension schemes
Other comprehensive (loss) income for the year, net of tax
Profit for the year
Total comprehensive income for the year
Attributable to:
Owners of the parent
Non-controlling interests
Total comprehensive income for the year
The notes on pages 177 to 246 are an integral part of these consolidated financial statements.
Note
2023
€m
2022
€m
5.5
3.4
4.4
7.2
3.4
2.5
3.7
0.7
0.3
7.2
(15.5)
3.8
(11.7)
(4.5)
66.6
62.1
58.4
3.7
62.1
(0.2)
16.5
(1.9)
0.5
14.9
10.5
(2.4)
8.1
23.0
75.4
98.4
97.5
0.9
98.4
Strategic reportGovernance reportFinancial statementsOther information
174
Consolidated Balance Sheet
As at 31 March 2023
Assets
Non-current assets
Goodwill and intangible assets
Property, plant and equipment
Right-of-use assets
Investments
Loans to associates and joint ventures
Financial assets relating to PPP contracts
Derivative financial instruments
Defined benefit pension scheme surplus
Other receivables
Deferred tax assets
Current assets
Inventories
Investments
Loans to associates and joint ventures
Financial assets relating to PPP contracts
Trade and other receivables
Derivative financial instruments
Current tax receivable
Cash and cash equivalents – including restricted cash
Assets classified as held for sale
Total assets
Liabilities
Non-current liabilities
Borrowings
Derivative financial instruments
Other non-current liabilities
Defined benefit pension schemes deficit
Provisions
Deferred tax liabilities
Current liabilities
Borrowings
Derivative financial instruments
Trade and other payables
Current tax payable
Provisions
Total liabilities
Net assets
Issued capital and reserves attributable to the owners of the parent
Share capital
Share premium
Exchange reserve
Retained earnings
Non-controlling interests
Total equity
* The comparatives have been restated due to a prior period adjustment as explained in section 1 Basis of preparation.
The notes on pages 177 to 246 are an integral part of these consolidated financial statements.
31 March
2023
€m
Note
Restated*
31 March
2022
€m
4.1
4.2
4.3
4.4
4.4
4.5
5.5
7.2
4.8
3.4
4.7
4.4
4.4
4.5
4.8
5.5
5.2
6.3
5.3
5.5
4.9
7.2
4.10
3.4
5.3
5.5
4.9
4.10
5.9
5.9
5.9
5.9
5.9
636.3
617.9
253.1
14.8
0.2
123.4
1.2
–
3.7
35.6
1,686.2
25.2
10.9
0.8
7.6
289.6
0.4
1.5
62.7
398.7
0.6
399.3
2,085.5
(681.6)
(2.6)
(34.7)
(9.3)
(298.2)
(46.4)
(1,072.8)
(66.8)
(1.9)
(521.8)
(31.2)
(43.7)
(665.4)
(1,738.2)
347.3
99.8
474.1
(12.2)
(224.5)
337.2
10.1
347.3
592.8
553.6
213.8
14.3
–
135.7
0.4
8.6
5.1
41.6
1,565.9
22.5
11.1
0.9
7.7
269.3
6.6
0.9
63.6
382.6
3.3
385.9
1,951.8
(509.9)
(14.6)
(36.2)
(6.3)
(262.9)
(47.0)
(876.9)
(148.2)
(0.1)
(528.4)
(24.2)
(32.1)
(733.0)
(1,609.9)
341.9
99.5
473.8
(14.9)
(223.5)
334.9
7.0
341.9
The Financial Statements on pages 172 to 246 were approved by the Board of Directors and authorised for issue on 25 May 2023. They were
signed on its behalf by:
Ben Verwaayen
Chairman
Annemieke den Otter
Chief Financial Officer
Renewi plcAnnual Report and Accounts 2023
175
Consolidated Statement of Changes in Equity
For the year ended 31 March 2023
Share
capital
€m
Share
premium
€m
Note
Restated*
Exchange
reserve
€m
Restated*
Retained
earnings
€m
Non-
controlling
interests
€m
Restated*
Total
equity
€m
Balance at 31 March 2022 – as reported
Impact of prior year adjustment (section 1)
Balance at 31 March 2022 – restated
Impact of adopting amendment to IAS 37 (section 1)
4.10
99.5
–
99.5
–
99.5
473.8
(15.0)
(227.1)
–
0.1
3.6
473.8
(14.9)
(223.5)
–
0.2
(53.4)
473.8
(14.7)
(276.9)
Balance at 1 April 2022
Profit for the year
Other comprehensive income (loss):
Exchange gain on translation of foreign subsidiaries
Fair value movement on cash flow hedges
Actuarial loss on defined benefit pension schemes
Tax in respect of other comprehensive income items
Share of other comprehensive income of investments accounted
for using the equity method
Total comprehensive income for the year
Dividend paid to non-controlling interests
Share-based compensation
Movement on tax arising on share-based compensation
Proceeds from exercise of employee options
Own shares purchased by the Employee Share Trust
Balance as at 31 March 2023
Balance at 1 April 2021 – as reported
Impact of prior year adjustment (section 1)
Balance at 1 April 2021 – restated
Profit for the year
Other comprehensive (loss) income:
Exchange loss on translation of foreign subsidiaries
Fair value movement on cash flow hedges
Actuarial gain on defined benefit pension schemes
Tax in respect of other comprehensive income items
Share of other comprehensive income of investments accounted
for using the equity method
Total comprehensive (loss) income for the year
Share-based compensation
Movement on tax arising on share-based compensation
Proceeds from exercise of employee options
Own shares purchased by the Employee Share Trust
–
–
–
–
–
–
–
–
–
–
0.3
–
99.8
99.5
–
99.5
–
–
–
–
–
–
–
–
–
–
–
5.5
7.2
3.4
4.4
7.3
5.9
5.9
5.5
7.2
3.4
4.4
7.3
5.9
5.9
7.0
–
7.0
–
7.0
3.7
–
–
–
–
–
3.7
(0.6)
–
–
–
–
338.2
3.7
341.9
(53.2)
288.7
66.6
2.5
3.7
(15.5)
4.5
0.3
62.1
(0.6)
2.7
(0.9)
0.6
(5.3)
–
–
–
–
–
–
–
–
–
–
0.3
–
–
62.9
2.5
–
–
–
–
2.5
–
–
–
–
–
–
3.7
(15.5)
4.5
0.3
55.9
–
2.7
(0.9)
–
(5.3)
474.1
(12.2)
(224.5)
10.1
347.3
473.6
–
473.6
–
–
–
–
–
–
–
–
–
0.2
–
(14.8)
0.1
(14.7)
–
(0.2)
–
–
–
–
(0.2)
–
–
–
–
(326.8)
3.6
(323.2)
74.5
–
16.5
10.5
(4.3)
0.5
97.7
2.5
1.3
–
(1.8)
6.1
–
6.1
0.9
–
–
–
–
–
0.9
–
–
–
–
237.6
3.7
241.3
75.4
(0.2)
16.5
10.5
(4.3)
0.5
98.4
2.5
1.3
0.2
(1.8)
341.9
Balance as at 31 March 2022
99.5
473.8
(14.9)
(223.5)
7.0
* The comparatives have been restated due to a prior period adjustment as explained in section 1 Basis of preparation.
The notes on pages 177 to 246 are an integral part of these consolidated financial statements.
Strategic reportGovernance reportFinancial statementsOther information 176
Consolidated Statement of Cash Flows
For the year ended 31 March 2023
Profit before tax
Finance income
Finance charges
Share of results from associates and joint ventures
Operating profit
Amortisation and impairment of intangible assets
Depreciation and impairment of property, plant and equipment
Depreciation and impairment of right-of-use assets
Impairment of investment in associate
Net gain on disposal of property, plant and equipment and intangible assets
Portfolio management and provision movements in non-trading and exceptional items
Net decrease in provisions
Payment related to committed funding of the defined benefit pension schemes
Share-based compensation
Operating cash flows before movement in working capital
Increase in inventories
Increase in receivables
Decrease in payables
Cash flows from operating activities
Income tax paid
Net cash inflow from operating activities
Investing activities
Purchases of intangible assets
Purchases of property, plant and equipment
Proceeds from disposals of property, plant and equipment
Acquisition of subsidiary, net of cash acquired
Disposal of subsidiary and business assets net of acquisition of business assets
Net movements in associates, joint ventures and other short-term investments
Receipt of deferred consideration
Outflows in respect of PPP arrangements under the financial asset model net of capital received
Finance income
Net cash outflow from investing activities
Financing activities
Finance charges and loan fees paid
Investment in own shares by the Employee Share Trust
Proceeds from share issues
Dividend paid to non-controlling interest
Proceeds from retail bonds
Repayment of retail bonds
Proceeds from bank borrowings
Repayment of bank borrowings
Repayment of PPP debt
Repayments of obligations under lease liabilities
Settlement of cross-currency interest rate swaps
Net cash outflow from financing activities
Net increase (decrease) in cash and cash equivalents
Effect of foreign exchange rate changes
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
* The comparatives have been restated due to a prior period adjustment as explained in section 1 Basis of preparation.
The notes on pages 177 to 246 are an integral part of these consolidated financial statements.
2023
€m
93.1
(10.7)
39.0
–
121.4
10.5
69.5
49.1
0.9
(3.0)
19.9
(34.1)
(3.5)
2.7
233.4
(2.1)
(12.2)
(9.5)
209.6
(21.2)
188.4
(9.9)
(115.0)
6.8
(53.5)
1.1
(1.3)
–
6.0
10.6
Restated*
2022
€m
95.7
(9.5)
38.3
(0.5)
124.0
11.1
74.7
45.5
1.9
(0.8)
(1.6)
(6.5)
(3.6)
2.5
247.2
(1.9)
(23.2)
(34.8)
187.3
(7.6)
179.7
(8.4)
(77.6)
4.7
–
(1.3)
(0.9)
0.3
5.8
9.9
(155.2)
(67.5)
(31.3)
(5.3)
0.6
(0.6)
–
(100.0)
565.0
(405.6)
(8.1)
(47.5)
–
(32.8)
0.4
(1.3)
63.6
62.7
(28.4)
(1.8)
0.2
–
125.0
–
141.6
(312.2)
(5.7)
(43.5)
6.4
(118.4)
(6.2)
1.0
68.8
63.6
Note
4.1
4.2
4.3
4.4
3.3
4.10
7.2
7.3
4.8
4.9
6.1
6,3.3
5.9
5.1
5.1
5.1
5.1
5.1
5.1
5.2
Renewi plcAnnual Report and Accounts 2023 177
Notes to the financial statements
Section 1. Basis of preparation
This section provides general information about the Group and the accounting policies that apply to the consolidated financial statements
as a whole. Accounting policies that are specific to a particular note are provided within the note to which they relate. This section also
details the new or amended accounting standards adopted during the year as well as the anticipated impact of future changes to accounting
standards that are not yet effective.
Renewi plc is a public limited company listed on the London Stock Exchange with a secondary listing on Euronext Amsterdam. Renewi plc is
incorporated and domiciled in Scotland under the Companies Act 2006, registered number SC077438 and the address of the registered office
is given on page 265. The nature of the Group’s operations and its principal activities are set out in section 2.
The consolidated financial statements of the Group are prepared in accordance with UK adopted international accounting standards
in conformity with the requirements of the Companies Act 2006.
The consolidated financial statements have been prepared on the historical cost basis, except for derivative financial instruments, other
receivables relating to invoice finance facilities, share-based payments, plan assets within pension schemes, unlisted investments and
short-term investments which are stated at fair value. The accounting policies adopted in the consolidated financial statements have been
consistently applied across the periods, with the exception of the amendment to IAS 37 Onerous Contracts - Costs of Fulfilling Contract as
explained later in this section. The Group has applied all accounting standards and interpretations issued relevant to its operations and
effective for accounting periods beginning on 1 April 2022. The consolidated financial statements are presented in Euros and all amounts are
rounded to the nearest €0.1m unless otherwise stated.
GOING CONCERN
The Directors have adopted the going concern basis in preparing these consolidated financial statements after assessing the Group’s principal
risks including an assessment of the impact of the ongoing high inflationary environment and the economic uncertainty arising from the
invasion of Ukraine and the recent banking crisis.
The Directors have carried out a comprehensive assessment of the Group’s ability to continue as a going concern. This assessment has
involved the review of medium-term cash flow and covenant modelling over an 18-month period to 30 September 2024. This includes
expectations on the future economic environment as well as other principal risks associated with the Group’s ongoing operations.
The assessment includes a base case scenario setting out the Directors’ current expectations of future trading and a plausible but severe
downside scenario after applying mitigating actions to assess the potential impact on the Group’s future financial performance. The key
judgement in both scenarios is the level of economic disruption caused by ongoing geopolitical events.
The downside scenario includes significantly weaker macroeconomic conditions leading to a volume decline below the forecast economic
outlook in all our territories in FY24 and FY25. Other downsides include a significant decline in recyclate prices from the current levels to below
long-term averages and operational downtime in some of our plants. These factors reduce FY24 EBIT by 31% compared to the base case.
Appropriate cash mitigating actions such as deferral of uncommitted capital expenditure and other working capital actions have been applied
to our downside modelling to arrive at a plausible and mitigated downside position.
In the base case and plausible mitigated downside scenarios the Group has sufficient liquidity and headroom in its existing facilities and no
covenants are breached at any of the forecast testing dates.
In addition, a reverse stress test calculation has been undertaken to consider the points at which the covenants may be breached. Underlying
EBIT in FY24 would need to reduce by 44% compared to the base case including mitigating cost actions. In the opinion of the Directors there is
no plausible scenario or combination of scenarios that we consider to be remotely likely that would generate this result.
Having considered all the elements of the financial projections, sensitivities and mitigating actions, the Directors confirm they have a
reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future and to meet all
banking covenants.
In accordance with Provision 31 of the UK Corporate Governance Code, the Directors have also assessed the prospects and financial viability of
the Company for a period longer than the 12 months required in the going concern assessment. Further details are provided in the Viability
Statement on page 100.
Strategic reportGovernance reportFinancial statementsOther information 178
SECTION 1. Basis of preparation CONTINUED
PRIOR YEAR RESTATEMENT
During the year, the Group has undertaken a more in depth analysis of the UK Municipal contract with East London Waste Authority (ELWA) as
the contract is due to expire in December 2027. The contract is loss-making and therefore an onerous contract provision (OCP) has been
recorded. At inception of this contract on 28 November 2003, a subsidiary of the Group entered a headlease arrangement for one location
under the contract and then subleased it to ELWA Limited, an associate, on terms which mirrored the terms of the headlease. Prior to the
disposal of the subsidiary in 2004 the headlease and sublease were novated to Renewi UK Services Limited (RUKS), a subsidiary of the Group.
Upon adoption of IFRS 16 Leases from 1 April 2019, the Group accounted for the headlease as a right-of-use asset with the rental expense
recorded as a repayment of the lease liability. The rental income from ELWA Limited was included within the cash flows used to measure the
OCP.
During March 2023, external legal advice received clarified further the legal position in relation to the commercial substance of the lease
arrangements. The legal advice stated that it is more likely than not that the sublease to ELWA Limited has taken effect as an assignment of
the headlease by operation of law. The practical effect of this is the former subsidiary and ELWA Limited are directly liable for the headlease
and that the novation in 2004 to RUKS was invalid. Accordingly, the Group has determined that it was not appropriate to recognise the
headlease as a right-of-use asset and the lease income should not have been included in the cash flows used to measure the OCP. The Group
has therefore concluded that the prior treatment was an error and that it is now appropriate to restate the 1 April 2021 opening balance sheet.
The impact is a reduction in lease liabilities of €10.1m (of which €9.4m is non-current and €0.7m is current) with a corresponding increase in
OCP of €6.4m (of which €5.4m is non-current and €1.0m is current) resulting in an impact of €3.6m on retained earnings and €0.1m on the
exchange reserve. The impact on the 31 March 2022 balance sheet is a reduction in lease liabilities of €9.5m (of which €8.8m is non-current and
€0.7m is current) with an increase in OCP of €5.8m (of which €4.8m is non-current and €1.0m is current) resulting in an impact of €3.6m on
retained earnings and €0.1m on the exchange reserve. The related right-of-use asset was fully impaired therefore there is no impact on the net
book value. However, as a result of the derecognition, cost and accumulated depreciation and impairment have both been reduced by €8.9m
as at 1 April 2021. The Income Statement impact for the year ended 31 March 2022 is not material and therefore has not been restated. The
impact on the Cash Flow Statement for the year ended 31 March 2022 is to reduce the cash inflow from operating activities by €0.7m and
reduce the cash outflow in financing activities by €0.7m. Earnings per share and alternative performance measures for the year ended 31 March
2022 are not affected as a result of this correction.
The impact on the Consolidated Balance Sheet at 31 March 2021 is not material and therefore as permitted in IAS 1 Presentation of Financial
Statements a third balance sheet is not presented. The impact of the above restatements on the relevant line items in the Consolidated
Balance Sheet and Statement of Changes in Equity is presented below:
Balance sheet extract
Total assets
Liabilities
Non-current liabilities
Borrowings
Provisions
Other
Current liabilities
Borrowings
Provisions
Other
Total liabilities
Net assets
Issued capital and reserves attributable
to the owner of the parent
Retained earnings
Exchange reserve
Other equity
Non-controlling interests
Total equity
1 April 2021
(previously
reported) Restatement
1 April 2021
(restated)
31 March 2022
(previously
reported) Restatement
31 March
2022
(restated)
1,968.0
–
1,968.0
1,951.8
–
1,951.8
(689.1)
(252.6)
(142.0)
(1,083.7)
(47.8)
(38.7)
(560.2)
(646.7)
(1,730.4)
237.6
(326.8)
(14.8)
573.1
231.5
6.1
237.6
9.4
(5.4)
–
4.0
0.7
(1.0)
–
(0.3)
3.7
3.7
3.6
0.1
–
3.7
–
3.7
(679.7)
(258.0)
(142.0)
(1,079.7)
(47.1)
(39.7)
(560.2)
(647.0)
(518.7)
(258.1)
(104.1)
(880.9)
(148.9)
(31.1)
(552.7)
(732.7)
(1,726.7)
(1,613.6)
241.3
338.2
(323,2)
(14.7)
573.1
235.2
6.1
241.3
(227.1)
(15.0)
573.3
331.2
7.0
338.2
8.8
(4.8)
–
4.0
0.7
(1.0)
–
(0.3)
3.7
3.7
3.6
0.1
–
3.7
–
3.7
(509.9)
(262.9)
(104.1)
(876.9)
(148.2)
(32.1)
(552.7)
(733.0)
(1,609.9)
341.9
(223.5)
(14.9)
573.3
334.9
7.0
341.9
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 179
SECTION 1. Basis of preparation CONTINUED
ADOPTION OF NEW AND REVISED ACCOUNTING STANDARDS
The amendment to IAS 37 Onerous Contracts – Costs of Fulfilling a Contract, effective from 1 April 2022, clarifies that the costs of fulfilling a
contract should include an allocation of other costs that relate directly to fulfilling the contract in addition to the incremental costs. As
required by the pre-amended IAS 37, the Group’s accounting policy previously only included incremental direct costs when measuring the
costs to fulfil a contract. The Group assessed the impact of this amendment which resulted in an increase to the onerous contract provisions
of €53.2m. A deferred tax asset has not been recognised on the increase in the provision due to the uncertainty of future profit streams in the
UK Municipal business. The cumulative effect of initially applying the amendment has been recognised as an adjustment to the opening
balance of retained earnings as at 1 April 2022 as shown in the Statement of Changes in Equity. As permitted by the amendment, the Group
has not restated the comparative information.
No other accounting standards, amendments or revisions to existing standards or interpretations have been effective which had a significant
impact on the Group’s consolidated financial statements.
NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED
Standards and interpretations issued by the International Accounting Standards Board (IASB) are only applicable if endorsed by the
UK Endorsement Board (UKEB). At the date of approval of these financial statements there were no new IFRSs or IFRS Interpretation
Committee interpretations which were early adopted by the Group.
The following amendments are effective for the period beginning 1 April 2023:
• Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)
• Definition of Accounting Estimates (Amendments to IAS 8)
• IFRS 17 Insurance Contracts
• Deferred Tax Related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12)
The following amendments are effective for the period beginning 1 April 2024:
• IFRS 16 (Amendment – Liability in a Sale and Leaseback)
• IAS 1 Presentation of Financial Statements (Amendment – Classification of Liabilities as Current or Non-current)
• IAS 1 Presentation of Financial Statements (Amendment – Non-current Liabilities with Covenants)
The Group does not expect a significant impact from any of the new accounting standards and amendments.
BASIS OF CONSOLIDATION
The consolidated financial statements incorporate the financial statements of Renewi plc (the Company), all its subsidiary undertakings
(subsidiaries) and the Group’s interests in joint ventures, associates and joint operations.
Subsidiaries are entities which are directly or indirectly controlled by the Group. Control exists where the Group is exposed to, or has rights to,
variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Where there is
a non-controlling interest this is identified separately from the Group’s equity. Accounting policies of subsidiaries have been adjusted where
necessary to ensure consistency with those used by the Group. The results of subsidiaries acquired or sold during the year are included in the
consolidated financial statements from or up to the date control passes. All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the
arrangement. An associate is an entity, other than a subsidiary or joint venture, over which the Group has significant influence. Significant
influence is the power to participate in the financial and operating decisions of an entity but is not in control or joint control over those
policies. Investments in associates and joint ventures are accounted for using the equity method of accounting and are initially recognised at
cost or, in the case of a disposal of the majority shareholding, at fair value. The cumulative post-acquisition profits or losses and movements in
Other Comprehensive Income are adjusted against the carrying amount of the investment. When the Group’s share of losses exceeds the
carrying amount of the joint venture or associate, the carrying amount is reduced to nil and recognition of further losses is discontinued
except to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the joint venture or associate.
Accounting policies of associates and joint ventures have been adjusted where necessary to ensure consistency with the policies of the Group.
Where the Group is party to a jointly controlled operation, the Group proportionately accounts for its share of the income and expenditure,
assets and liabilities and cash flows on a line-by-line basis in the consolidated financial statements.
Other investments in entities that are neither associates, joint ventures nor subsidiaries are held at fair value through profit or loss except for
the other unlisted investments that the Group has elected to hold at fair value through Other Comprehensive Income.
Strategic reportGovernance reportFinancial statementsOther information 180
SECTION 1. Basis of preparation CONTINUED
FOREIGN CURRENCIES
The financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the
entity operates (the functional currency). The results and financial position of all the Group entities that have a functional currency different
from the presentation currency of the Group are translated as follows:
• monetary assets and liabilities at each balance sheet date are translated into Euros at the closing year end exchange rate;
• income and expenses in each Income Statement are translated into Euros at the average rate of exchange for the month in which they occur;
and
• equity items are translated at the historical rate being the average rate of exchange in the year when the transaction occurred.
The resulting exchange differences in relation to the Sterling denominated entities are recognised in the exchange reserve in Other
Comprehensive Income.
Exchange differences arising on the retranslation of unsettled monetary assets and liabilities are recognised immediately in profit or loss.
In addition to the Group’s presentational currency of Euros, the most significant currency for the Group is Sterling with the closing rate on
31 March 2023 of €1: £0.879 (2022: €1: £0.845) and an average rate for the year ended 31 March 2023 of €1: £0.870 (2022: €1: £0.849).
Cumulative exchange differences are recognised in the Income Statement in the year in which a non-Euro denominated subsidiary
undertaking is sold.
The Group applies the hedge accounting principles of IFRS 9 Financial Instruments relating to net investment hedging to offset the exchange
differences arising on foreign currency denominated borrowings with the translation of foreign operations. Net investment hedges are
accounted for by recognising exchange rate movements in the exchange reserve, with any hedge ineffectiveness being charged to the Income
Statement in the period the ineffectiveness arises.
CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES
The preparation of financial statements in accordance with IFRS requires management to make judgements, estimates and assumptions that
affect the application of policies and reported amounts of assets and liabilities, income and expenditure. The areas involving a higher degree
of judgement or complexity are set out below and in more detail in the related notes. Critical estimates are defined as those that have a
significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year. The
estimates and associated assumptions are based on factors including historical experience and expectations of future events that are
considered to be relevant and reasonable. These estimates, assumptions and judgements are reviewed on an ongoing basis.
Judgements in applying the Group’s accounting policies
Use of alternative performance measures – The Group uses alternative performance measures as we believe these measures provide
additional useful information on the underlying trends, performance and position of the Group. These underlying measures are used by the
Group for internal performance analysis and incentive compensation arrangements for employees. The term ‘underlying’ refers to the relevant
measure being reported for continuing operations excluding non-trading and exceptional items. These include underlying earnings before
interest and tax (underlying EBIT), underlying profit before tax, underlying profit after tax, underlying earnings per share and underlying EBITDA
(earnings before interest, tax, depreciation and amortisation). The terms ‘EBIT’, ‘EBITDA’, ‘exceptional items’, ‘adjusted’ and ‘underlying’ are not
defined terms under IFRS and may therefore not be comparable with similarly titled profit measures reported by other companies. These
measures are not intended to be a substitute for, or superior to, GAAP measurements of profit. A full list of alternative performance measures
together with reconciliations are set out in note 8.3.
Non-trading and exceptional items – In establishing which items are disclosed separately as non-trading and exceptional to enable a better
understanding of the underlying financial performance of the Group, management exercise judgement in assessing the size, nature or
incidence of specific items. A policy for non-trading and exceptional items is followed consistently and is submitted to the Audit Committee for
annual review. See note 3.3 for further details of the costs included within this category.
Service concession arrangements – Management considered all relevant factors including the expectation by the relevant local authority
who was the primary obligor, the ability of the Group to set the selling price, who performed the service, who assumed the credit risk and who
had discretion in selecting suppliers. Following this assessment the Group determined that it acted as agent during the construction phase of
the UK Municipal contracts. Consequently the consideration from local authorities for the operations of waste management service
concessions is treated as financial assets relating to PPP contracts in accordance with IFRIC 12. Management determined that the cash flows
relating to the outflows in respect of PPP arrangements under the financial asset model net of capital received are investing activities in the
statement of cash flows and not operating cash flows. At the balance sheet date, the Group has financial assets relating to PPP contracts of
€131.0m (2022: €143.4m). Consideration relating to financial assets is split between a service element as revenue and a repayment element,
split between capital and interest receivable that is deducted from the financial asset. Further details are given in notes 3.1 and 4.5.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 181
SECTION 1. Basis of preparation CONTINUED
Defined benefit pension scheme surplus – In relation to the prior year surplus, based on actuarial professional advice management
concluded that the UK defined benefit pension scheme rules determine that upon winding up the scheme the Group has an unconditional
right to a refund once all of the liabilities have been discharged and that the trustees of the scheme do not have the unilateral right to wind up
the scheme, therefore any asset is not restricted and no additional liability is recognised. See note 7.2 for further details of the scheme.
ELWA headlease – Management have used judgement based on external legal advice in determining that the headlease in relation to the
ELWA contract has been assigned to ELWA Limited by operation of law and therefore a novation of the headlease and sublease to RUKS in
2004 is invalid. It is therefore not appropriate for the Group to recognise the lease under IFRS 16. Consequently, the rental expense and the
rental income are presented net within the onerous contract provision. Additional details are provided earlier in the prior year restatement
section.
Wakefield Waste Holdings Limited joint venture - The Group has a 50.001% interest in the joint venture Wakefield Waste Holdings Limited.
Upon the sale of 49.99% of this entity in 2016 the Group assessed the criteria of control considering power over the investee, exposure or rights
to a variable return and the ability to use power over the investee to affect the amount of the investors returns. The Group determined that it
does not meet the criteria for having control as each party jointly controls the entity and as a result it is appropriate to equity account.
There are no other critical judgements other than those involving estimates, as set out below, that have a significant effect on the amounts
recognised in the Group’s consolidated financial statements.
Key sources of estimation uncertainty
Landfill related provisions – The Group has landfill related provisions of €164.5m (2022: €156.9m). These provisions are long term in nature
and are recognised at the net present value of the best estimate of the likely future cash flows to settle the Group’s obligations. The period of
aftercare post-closure and the level of costs expected are uncertain and could be impacted by changes in inflation, legislation and technology
and can vary significantly from site to site. The timings of cash outflows are uncertain and have been based on management’s latest
expectations. A discount rate is applied to recognise the time value of money and is unwound over the life of the provision. Details of the
discount rates used and sensitivity assumptions are set out in note 4.10.
Onerous contract provisions – Onerous contract provisions arise when the unavoidable costs of meeting contractual obligations exceed the
cash flows expected. The Group has onerous contract provisions of €141.9m (31 March 2022 as restated: €85.7m, 1 April 2022: €138.9m adjusted
for the impact of IAS 37 amendment) which have been provided for at the lower of the net present value of either exiting the contract or
fulfilling our obligations under the contract. The most significant component of these provisions relates to UK Municipal PPP contracts which
amount to €139.3m (31 March 2022 as restated: €83.5m, 1 April 2022: €135.3m adjusted for the impact of IAS 37 amendment ). The provisions
have been based on the best estimate of likely future cash flows including assumptions on inflationary increases, tonnage inputs, off-take
availability and recyclates pricing. The contracts include revenue inflationary clauses which together with cost inflation are sources of
estimation uncertainty. A discount rate is applied to recognise the time value of money and is unwound over the life of the provision. Further
details including the discount rates used and sensitivity assumptions are set out in note 4.10.
Taxation – The recognition of deferred tax assets, particularly in respect of tax losses, is based upon management’s judgement in the
calculation of the probable expected taxable profits in the relevant legal entity or tax group against which to utilise the assets in the future. In
respect of tax losses, the time expiry period, if any, is also taken into account in the calculation. The Group assesses the availability of future
taxable profits using available long-term forecasts. The predictability of income streams is taken into consideration in the recognition of
deferred tax assets. The longest period of forecasts used to calculate deferred tax recovery is eight years. This period reflects management’s
estimate of the higher probability profit streams due to income streams from internal receivables which are highly predictable and likely to
continue for the foreseeable future. The intention is to avoid the recognition of a deferred tax asset that is not ultimately recovered. Provisions
have been recognised where necessary in respect of any uncertain tax positions in the Group, including uncertainty over whether the relevant
tax authority will accept the tax treatment and are based upon management’s evaluation of the potential outcomes of the relevant discussions
with the tax authorities. Further details on sensitivity assumptions are set out in note 3.4.
Other areas of focus
Whilst not considered to be critical accounting judgements or key sources of estimation uncertainty, the following are areas of focus for
management:
Assumptions used to determine the recoverable amount of goodwill and other assets – Impairment testing of goodwill is carried out
annually at a cash generating unit (CGU) level. The Group estimates the recoverable amount of a CGU using a value in use model which
involves an estimation of future cash flows and applying appropriate discount and long-term growth rates. The future cash flows are derived
from approved forecasts which have taken into account increasing energy prices and high inflation as a result of the events in Ukraine,
specifically with regard to recovery of input volumes across different waste streams. Details of the key assumptions and sensitivity analysis are
given in note 4.1. The Group assesses the impairment of tangible assets, intangible assets and investments whenever there is reason to believe
that the carrying value may exceed the fair value and where a permanent impairment in value is anticipated. The determination of whether the
impairment of these assets is necessary involves the use of estimates that include, but is not limited to, the analysis of the cause, the timing
and expected future cash flows.
Strategic reportGovernance reportFinancial statementsOther information 182
SECTION 1. Basis of preparation CONTINUED
Right-of-use assets and lease liabilities – Estimates and assumptions are made in calculating the incremental borrowing rate used
to measure lease liabilities where the lease contract does not contain an implicit rate. For certain leases the determination of the lease liability
is based on assumptions of the term as to whether purchase options are likely to be exercised. Further details are set out in note 5.3.
Assumptions used to determine the carrying amount of the Group’s defined benefit pension schemes – The calculation of the present
value of the defined benefit pension schemes is determined by using actuarial valuations based on assumptions including discount rate, life
expectancy and inflation rates. The principal assumptions used to measure the schemes’ liabilities, sensitivities to changes in those assumptions
and future funding obligations are set out in note 7.2.
Waste disposal cost accruals – Management have used judgement in determining the value of disposal cost accruals with a carrying amount
included in accruals and other payables of €51.8m (2022: €48.9m). Included in this is €21.1m (2022: €21.1m) relating to previously processed soil
and other materials at ATM. The value is determined by management’s best estimate after carrying out an assessment of the cost per tonne to
dispose of the waste based on historical transactions, signed contracts, discussions with potential customers and knowledge of the market as
in some cases, due to the nature that in some cases there is no observable market data. Management carry out sensitivity analysis on a range
of potential outcomes and an increase or reduction of the cost per tonne by 10% would impact the ATM accrual by €2.1m. It is now expected
that the disposal of certain components will take longer than 12 months and consequently €17.6m has been recorded as a non-current liability.
Valuation of acquisition related intangible assets – When acting as the acquirer in a business combination, the Group is required to
recognise separate from goodwill all intangibles that are either separable or arise from contractual or other legal obligations. In the acquisition
of GMP Exploitatie B.V. on 1 August 2022 the Group acquired permits and customer relationships with a total value of €27.6m which are
explained in note 6.1. Determination of the fair value required a variety of judgemental assumptions including, but not limited to, estimates of
expected cash flows and discount rates for which external specialists were engaged to provide expert assistance. If the fair value of these
acquisition related intangibles was 15% different to the recorded value, the impact of the variance of €4m would be recorded in goodwill with
an adjustment of c€0.5m to the annual amortisation charge of acquisition related intangibles over the next eight years.
Expected credit loss allowance – Management have used judgement to estimate how the expected credit loss allowance could be impacted
by current conditions as well as forecasts of future economic conditions as a result of ongoing macroeconomic factors. For trade receivables
and accrued income, in addition to using a provision matrix based on the payment profile of revenues a detailed review has been undertaken
at a customer level in order to assess the likely potential of default considering the nature of the customers business and any government
support measures. Further details are set out in note 4.8.
Consideration of climate change – In preparing the financial statements, the Directors have considered the impact of climate change,
particularly in the context of the risks identified as part of the work on the Taskforce for Climate-related Financial Disclosures (TCFD)
disclosures on pages 59 to 65. Sustainability is recognised as a growth driver for Renewi, directly aligned to its purpose to protect the world by
giving life to used materials, and is considered in all key decisions across all management levels. The Directors have commenced a pilot
quantitative exercise based on certain risks identified in the TCFD disclosures and now have models that greatly enhance our understanding of
the potential impact of these risks on revenue and operating costs, where relevant.
Physical climate change poses risks to our operations and supply chain. However, mitigation measures are either already in place, or are in the
process of being further developed. In response to increased impacts from extreme heat, we continually invest to avoid and mitigate the
impact of fires as one of the greatest operational risks in the waste industry. These investments are in processes and systems of fire prevention,
detection, and suppression.
Climate change is not considered to have a material adverse impact on the financial reporting judgements and estimates. In particular, the
impact of climate change has been considered in respect of the following areas in both the medium and long term:
• Going concern and viability of the Group over the next three years
• Cash flow forecasts used in the impairment assessments of non-current assets including goodwill, customer contracts and deferred tax
assets
• Carrying value and useful economic lives of property, plant and equipment.
The Directors are aware of the ever-changing risk of climate change and will regularly assess these risks against judgements and estimates
made in preparation of the Group’s financial statements.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 183
SECTION 2. Segmental information
This section shows the performance, net assets and other information on a segmental basis. The Group’s segmental reporting reflects the
management structure which is aligned with the core activities of the Group.
The Group’s chief operating decision maker is considered to be the Board of Directors. The Group’s reportable segments are determined
with reference to the information provided to the Board of Directors, in order for it to allocate the Group’s resources and to monitor the
performance of the Group. These segments are unchanged from March 2022 and are set out below.
Commercial Waste
Collection and treatment of commercial waste in the Netherlands and Belgium.
Mineralz & Water
Decontamination, stabilisation and re-use of highly contaminated materials to produce certified secondary
products for the construction industry in the Netherlands and Belgium.
Specialities
Processing plants focusing on recycling and diverting specific waste streams. The operations are in the UK, the
Netherlands, Belgium, France and Portugal.
Group central services Head office corporate function.
The profit measure the Board of Directors uses to evaluate performance is underlying EBIT. The Group accounts for inter-segment trading on
an arm’s length basis.
The Commercial Waste reportable segment includes the Netherlands Commercial Waste and Belgium Commercial Waste operating segments
which have been aggregated and reported as one reportable segment as they operate in similar markets in relation to the nature of the
products, services, processes and type of customer. As detailed in note 6.1, the Group acquired GMP Exploitatie B.V during the year and it is
included in the Netherlands Commercial operating segment.
REVENUE
Netherlands Commercial Waste
Belgium Commercial Waste
Intra-segment
Commercial Waste
Mineralz & Water
Specialities
Inter-segment revenue
Revenue
2023
€m
932.0
468.4
(3.1)
2022
€m
896.2
466.9
(2.6)
1,397.3
1,360.5
190.9
193.9
348.6
350.1
(44.5)
1,892.3
(35.3)
1,869.2
Strategic reportGovernance reportFinancial statementsOther information
184
SECTION 2. Segmental information CONTINUED
RESULTS
Netherlands Commercial Waste
Belgium Commercial Waste
Commercial Waste
Mineralz & Water
Specialities
Group central services
Underlying EBIT
Non-trading and exceptional items (note 3.3)
Operating profit
Finance income (note 5.4)
Finance charges (note 5.4)
Finance income – non-trading and exceptional items (note 3.3)
Finance charges – non-trading and exceptional items (note 3.3)
Share of results from associates and joint ventures
Profit before taxation
NET ASSETS
31 March 2023
Gross non-current assets
Gross current assets
Gross liabilities
Net assets (liabilities)
31 March 2022
Gross non-current assets
Gross current assets
Gross liabilities
Net assets (liabilities)
Commercial
Waste
€m
Mineralz &
Water
€m
Restated*
Specialities
€m
Group central
services
€m
1,143.8
206.6
(379.3)
971.1
1,010.8
192.0
(399.3)
803.5
262.6
35.2
(216.5)
81.3
257.5
37.9
(206.4)
89.0
211.1
75.0
(239.0)
47.1
219.3
67.7
(180.5)
106.5
31.9
17.9
(72.9)
(23.1)
36.3
17.2
(79.7)
(26.2)
* The comparatives have been restated due to a prior period adjustment as explained in section 1 Basis of preparation.
2023
€m
76.9
52.4
129.3
0.5
17.1
2022
€m
93.1
42.6
135.7
5.8
4.1
(14.0)
(12.0)
132.9
(11.5)
121.4
9.8
(39.0)
0.9
–
–
93.1
Restated*
Tax, net
debt and
derivatives
€m
36.8
64.6
(830.5)
(729.1)
42.0
71.1
(744.0)
(630.9)
133.6
(9.6)
124.0
9.3
(38.2)
0.2
(0.1)
0.5
95.7
Restated*
Total
€m
1,686.2
399.3
(1,738.2)
347.3
1,565.9
385.9
(1,609.9)
341.9
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
SECTION 2. Segmental information CONTINUED
OTHER DISCLOSURES
2023
Capital additions:
Property, plant and equipment
Right-of-use assets
Intangible assets
Depreciation charge:
Property, plant and equipment
Right-of-use assets
Amortisation of intangibles
Impairment charge:
Property, plant and equipment
Right-of-use assets
Investment in associate
Reversal of impairment charge:
Property, plant and equipment
Right-of-use assets
Non-trading and exceptional items before tax
2022
Capital additions:
Property, plant and equipment
Right-of-use assets
Intangible assets
Depreciation charge:
Property, plant and equipment
Right-of-use assets
Amortisation of intangibles
Impairment charge:
Property, plant and equipment
Right-of-use assets
Goodwill and Intangible assets
Investment in associate
Non-trading and exceptional items before tax
185
Total
€m
117.9
57.4
8.7
69.8
47.3
10.5
1.7
2.3
0.9
(2.0)
(0.5)
10.6
73.3
27.1
9.3
69.3
44.8
8.8
5.4
0.7
2.3
1.9
9.5
Commercial
Waste
€m
Mineralz &
Water
€m
Specialities
€m
Group
central
services
€m
86.4
40.2
–
49.9
36.3
5.1
1.7
1.0
–
–
(0.5)
(5.4)
52.0
17.0
0.1
50.6
34.0
3.2
5.2
0.7
–
–
6.2
13.4
10.0
1.7
13.9
3.1
0.9
–
–
–
–
–
(0.5)
13.0
1.6
1.7
12.8
3.0
0.6
0.2
–
–
–
(2.9)
15.3
4.6
–
4.5
3.3
1.0
–
1.3
0.9
(2.0)
–
19.2
6.6
5.0
0.1
4.6
3.5
1.7
–
–
–
1.9
0.7
2.8
2.6
7.0
1.5
4.6
3.5
–
–
–
–
–
(2.7)
1.7
3.5
7.4
1.3
4.3
3.3
–
–
2.3
–
5.5
GEOGRAPHICAL INFORMATION
The Group’s segment assets (non-current assets being intangible assets, property plant and equipment, right-of-use assets and investments)
by geographical location are detailed below:
Netherlands
Belgium
UK
France
Portugal
Hungary
Segment assets
2023
€m
1,110.6
385.5
5.5
17.4
3.3
–
2022
€m
985.8
362.1
6.6
17.4
2.5
0.1
1,522.3
1,374.5
Strategic reportGovernance reportFinancial statementsOther information
186
SECTION 3. Operating profit and tax
This section contains the notes that relate to the results and performance of the Group during the year, along with the related accounting
policies that have been applied.
3.1 REVENUE RECOGNITION
The Group applies IFRS 15 Revenue from Contracts with Customers which requires companies to apportion revenue from customer contracts
to separate performance obligations and recognise revenue as these performance obligations are satisfied. The majority of the Group’s
revenue is generated from the performance obligation to the customer to either collect and process the waste or process the waste.
In the Commercial segment where the contract with a customer includes the collection of waste with a positive value and in the Specialities
segment where a customer is paid a compensation based on the composition of the waste processed, the transaction price includes an
element of non-cash consideration. This increases revenue with a corresponding increase in cost of sales for the value of the waste collected
or compensation paid with no impact on operating profit.
Accounting policy
Under IFRS 15 revenue is defined as income arising in the course of the Group’s waste collection and processing activities and is recognised
when the control of goods or services is transferred and is allocated to individual performance obligations. Revenue represents the fair value
of consideration received or receivable for goods and services provided in the normal course of business, including landfill tax but excluding
sales taxes, discounts and inter-company sales. Revenue is recognised either at a point in time when the goods or services are transferred or
over time. Revenue is recognised over time when the customer simultaneously receives and consumes the benefits provided by the Group’s
performance as the Group provides the goods or services or when there is an enforceable right to payment for performance completed to
date. In most cases the Group’s revenue is not subject to conditions that would imply a variable consideration. There is a limited number of
contracts with variable consideration where revenue is only recognised to the extent that it is highly probable that a significant reversal in the
amount of cumulative revenue recognised will not occur.
Revenue recognition criteria for the key types of services have been examined, determined and documented on a divisional level, based on
the general and specific contracts with customers and are as follows:
• Inbound revenue relates to the collection and/or processing of waste. The transaction price is based on contractually agreed prices for
collecting and processing the waste and differs depending upon the nature of the contract – contracts can be an all-in-tariff, split between
rent, processing and transport or a price per tonne basis for different types of waste. Due to the very short time period between the start and
completion of the performance obligations (usually on the same day), the revenue recognition and the allocation of the transaction price
over performance obligations is usually straightforward and dependent on the daily collection and processing of the waste.
— Waste collection services: revenue is recognised at the point in time when the waste is delivered to transfer stations or to a third-party
processing facility.
— Waste processing services: where the Group’s revenue contracts include an obligation to process waste, revenue is recognised over time
based on the percentage of the processing service or activity that has been undertaken and there is an enforceable right to payment for
the performance completed. Where the waste processing has a very short cycle then revenue is recognised at the point in time when the
waste is processed.
• Outbound revenue relates to the sale of recyclate materials and products from processing waste and the generation of power. The
transaction price is agreed with the customer either in a contract or in relation to a market index and is charged based on tonnage
or kilowatt hour and in some situations will include an additional charge for transport services.
— Sale of recyclate materials and products from processing waste: revenue is based on contractually agreed prices and is recognised at
a point in time when control of the asset is transferred to the buyer.
— Income from power generation: for gas produced by processes at anaerobic digestion facilities and landfill sites revenue is recognised
at a point in time based on the volumes of energy produced and an estimation of the amount to be received.
• On-site revenue relates to activities and services provided to the customer on their own site, mainly cleaning services at customer
installations. The transaction price can be a contracted lump sum or is charged by applying a fixed price per hour, litre or item depending on
the nature of the contract.
• Other includes charges for sundry low value packing materials, waste advisory services to support customers with waste collection and
treatment activities and preservation and maintenance of waste treatment facilities.
The timing of payments from customers is generally aligned to revenue recognition and subject to agreed invoice terms. Accrued income
(unbilled revenue) at the balance sheet date is recognised at fair value based on services provided and contractually agreed prices. It is
subsequently invoiced and accounted for as a trade receivable and further details are set out in note 4.8. Unprocessed waste may give rise to
deferred revenue, where invoices to customers are raised in advance of performance obligations being completed or require an accrual for the
costs of disposing of residual waste once the Group has an obligation for its disposal. These amounts are shown in deferred revenue or
accruals in the consolidated financial statements as appropriate. Further details relating to deferred revenue are given in note 4.9.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 187
SECTION 3. Operating profit and tax CONTINUED
3.1 REVENUE RECOGNITION CONTINUED
The practical expedient available under IFRS 15 has been taken whereby any financing element of the contract has been ignored as the timing
difference between the satisfaction of the obligations under the contract and the receipt of payment due under the contract are expected to be
one year or less.
The Group’s Private Finance Initiative/Public Private Partnership (PPP) contracts in the UK Municipal business line in the Specialities division are
waste management contracts which required the building of new infrastructure and all rights to the infrastructure pass to the local authority at
the termination or expiry of the contract. The Group applies IFRIC 12 Service Concession Arrangements which specifies the accounting treatment
applied by concession operators. Under IFRIC 12, the operator’s rights over infrastructure operated under concession arrangements should be
accounted for based on having considered the extent to which the grantor (the local authority) controls the assets, over what services the
operator must provide with the infrastructure, to whom it must provide them and at what price. Having considered these factors, the Group
applies the ‘financial asset’ model to account for the infrastructure as it has an unconditional right to receive cash. The Group splits the local
authority payment between a service element as revenue and a repayment element that is deducted from the financial asset. The part of the
service element which covers the obligation to undertake major refurbishments and renewals to maintain the infrastructure, such that it is
handed over to the local authority in good working order, is known as lifecycle and is deferred and only recognised as revenue when the service is
provided. Further details are given in note 4.5.
The following tables show the Group’s revenue by type of service delivered and by primary geographical markets:
By type of service
2023
Inbound
Outbound
On-site
Other
Total revenue
2022
Inbound
Outbound
On-site
Other
Total revenue
By geographical market
2023
Netherlands
Belgium
UK
France
Other
Total revenue
2022
Netherlands
Belgium
UK
France
Other
Total revenue
Total
€m
1,405.2
391.4
63.4
32.3
1,892.3
1,419.3
372.6
52.9
24.4
1,869.2
Total
€m
1,117.5
542.1
188.4
27.1
17.2
Commercial
Waste
€m
Mineralz &
Water
€m
Specialities
€m
Inter-segment
€m
1,089.6
218.0
63.6
26.1
1,397.3
1,073.0
212.2
53.1
22.2
1,360.5
153.2
37.7
–
–
190.9
146.5
47.4
–
–
193.9
202.4
140.0
–
6.2
348.6
231.4
116.5
–
2.2
350.1
(40.0)
(4.3)
(0.2)
–
(44.5)
(31.6)
(3.5)
(0.2)
–
(35.3)
Commercial
Waste
€m
Mineralz &
Water
€m
Specialities
€m
Inter-segment
€m
931.2
466.1
–
–
–
159.2
31.7
–
–
–
1,397.3
190.9
895.5
465.0
–
–
–
152.9
41.0
–
–
–
1,360.5
193.9
69.3
46.6
188.4
27.1
17.2
348.6
55.4
39.8
216.3
26.3
12.3
350.1
(42.2)
(2.3)
–
–
–
(44.5)
1,892.3
(32.9)
(2.4)
–
–
–
1,070.9
543.4
216.3
26.3
12.3
(35.3)
1,869.2
Revenue recognised at a point in time amounted to €1,670.4m (2022: €1,652.5m) with the remainder recognised over time. The majority of the
Commercial Waste and Specialities revenue is recognised at a point in time, whereas for Mineralz & Water 62% of revenue (2022: 57%) is
recognised over time.
Strategic reportGovernance reportFinancial statementsOther information 188
SECTION 3. Operating profit and tax CONTINUED
3.2 OPERATING PROFIT
Detailed below are the key amounts recognised in arriving at the operating profit for the year:
Staff costs
Depreciation of property, plant and equipment
Impairment of property, plant and equipment
Depreciation of right-of-use assets
Impairment of right-of-use assets
Reversal of prior year right-of-use impairment charge
Amortisation of intangible assets
Impairment of intangible assets
Impairment of investment in associate
Repairs and maintenance expenditure on property, plant and equipment
Net gain on disposal of property, plant and equipment and intangible assets
Expense relating to short-term leases
Expense relating to low-value assets
Income from subleasing right-of-use assets
Foreign exchange
Non-trading and exceptional items
Net (credit) charge for expected credit loss allowance on trade receivables and accrued income
Note
7.1
4.2
4.2
4.3
4.3
4.3
4.1
4.1
4.4
3.3
4.8
2023
€m
433.2
69.8
1.7
47.3
1.0
(0.5)
10.5
–
0.9
109.1
(3.0)
20.4
10.2
(1.1)
(0.5)
11.5
(2.6)
The total remuneration of the Group’s auditors, BDO LLP and its associates for services provided to the Group during the year was:
Audit of parent company and consolidated financial statements
Audit of subsidiaries pursuant to legislation
Audit related assurance services*
Fees payable to the auditors pursuant to legislation
*Audit related assurance services included interim review, audit of ESEF tagging and climate change limited assurance.
2023
€m
0.4
1.7
0.3
2.4
2022
€m
402.5
69.3
5.4
44.8
0.7
–
8.8
2.3
1.9
99.7
(0.8)
17.4
9.5
(0.8)
–
9.6
0.6
2022
€m
0.4
1.3
0.2
1.9
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
189
SECTION 3. Operating profit and tax CONTINUED
3.3 NON-TRADING AND EXCEPTIONAL ITEMS
To improve the understanding of the Group’s financial performance, items which are not considered to reflect the underlying performance
are presented as non-trading and exceptional items. Items classified as non-trading and exceptional are disclosed separately due to
their size or incidence to enable a better understanding of performance. These include, but are not limited to, significant impairments,
significant restructuring of the activities of an entity including employee associated severance costs, acquisition and disposal related
transaction costs, significant fires, onerous contracts arising from restructuring activities or if significant in size, profit or loss on disposal
of properties or subsidiaries as these are irregular, the impact of terminating hedge derivatives, ineffectiveness of derivative financial
instruments, the impact of changing the discount rate on provisions, amortisation of acquisition related intangibles and one-off tax credits
or charges. The amortisation charge on acquisition related intangible assets is excluded from underlying results due to its non-trading
nature in the same way as other significant items from M&A activity are excluded. The performance of the acquired business is assessed
as part of the Group’s underlying revenue and EBIT. By excluding this amortisation charge there is comparability across divisions and
reporting periods.
Non-trading and exceptional items are considered individually and assessed at each reporting period.
Renewi 2.0 improvement programme
Portfolio management activity:
Prior year disposals
Disposal of business assets in the Mineralz & Water division
Changes in long-term provisions:
UK Municipal reassessment of onerous contract provisions
Changes in discount rate
Release of legal provision relating to the alleged State Aid claim in Belgium
Other items:
Reversal of prior year property, plant and equipment impairment
Configuration or customisation costs in cloud computing, Software as a Service arrangements
Restructuring credit – cash
Ineffectiveness and impact of termination of cash flow hedges
Amortisation of acquisition intangibles
Non-trading and exceptional items in profit before tax
Tax on non-trading and exceptional items
Exceptional tax credit
Total non-trading and exceptional items in profit after tax
Note
4.1
2023
€m
3.7
(1.7)
(3.8)
(5.5)
27.1
(1.7)
(15.1)
10.3
(2.0)
–
–
(2.0)
(0.9)
5.0
10.6
(1.6)
–
9.0
2022
€m
6.6
(0.7)
–
(0.7)
–
(3.1)
–
(3.1)
–
3.9
(0.5)
3.4
(0.1)
3.4
9.5
(2.4)
(3.7)
3.4
Renewi 2.0 improvement programme
Renewi 2.0 improvement programme is a significant one-off business improvement project with capital and one-off costs now of €28m,
previously €40m, and as a result is considered to be exceptional. Following the transformational merger in February 2017, the goal of the
Renewi 2.0 programme is to make the Group more streamlined and more efficient and improve customer experience and increase employee
engagement. This is the third year of the programme which is largely complete and will achieve the targeted €20m run rate of savings in the
next financial year, with the final costs of €3m to be incurred and paid in the year to March 2024. The costs of €3.7m (2022: €6.6m) of which €nil
(2022: €0.1m) are recorded in cost of sales and €3.7m (2022: €6.5m) are recorded in administrative expenses.
Portfolio management activity
During the current year certain business assets in the Mineralz & Water division were sold generating a profit of €3.8m (2022: €nil). The prior
year disposals credit of €1.7m (2022: €0.7m) relates to an insurance claim recovery in relation to a prior disposal. The credit recognised in the
prior year includes releases of warranty provisions in relation to prior year disposals. These are all recorded in administrative expenses. The
line item portfolio management and provision movements in non-trading and exceptional items in the Statement of Cash Flows includes an
add back of the €5.5m credit (2022: €nil) and the line item disposal of subsidiary and business assets net of acquisition of business assets
includes the cash inflow of €1.7m (2022: €nil) from portfolio management activity.
Strategic reportGovernance reportFinancial statementsOther information 190
SECTION 3. Operating profit and tax CONTINUED
3.3 NON-TRADING AND EXCEPTIONAL ITEMS CONTINUED
Changes in long-term provisions
The charge of €27.1m (2022: €nil) in relation to the reassessment of UK Municipal onerous contract provisions is due to revised assumptions on
both lifecycle spend and cost inflation, combined with lower volumes at the ELWA contract partially offset by the indexation of customer
pricing.
The credit for changes in discount rate of €1.7m is a result of the annual reassessment of risk free rates which have impacted all long-term
provisions as explained further in note 4.10. The prior year credit of €3.1m related to future cash flow funding requirements in relation to Dutch
landfills as a result of changes in the discount rate as determined by the relevant Dutch Province in relation to the long-term aftercare funds.
These funds are managed and under the control of the Province.
On 3 March 2023 the European Commission concluded its formal investigation and determined that the Belgian Walloon Region did not
provide State Aid to the Group and therefore the provision of €15.1m has been released.
The total charge of €10.3m (2022: €3.1m credit) was split €25.6m charge (2022: €3.1m credit) to cost of sales and a credit of €15.3m (2022: €nil)
to administrative expenses. The line item portfolio management and provision movements in non-trading and exceptional items in the
Statement of Cash Flows reflects an add back of the charge of €25.4m (2022: €1.6m) from changes in provisions.
Other items
A reversal of a prior year property, plant and equipment impairment of €2.0m relates to the Maltha CGU within Specialities as a result of
improvement in performance.
Prior year configuration or customisation costs in cloud computing, Software as a Service (SaaS) arrangements of €3.9m, related to the Group
updating its accounting policy on when software can be capitalised following the IFRIC interpretation. This guidance clarified the criteria for
when assets could be capitalised under IAS 38 Intangible assets in relation to SaaS arrangements and it was determined that items had been
capitalised which no longer met the criteria for recognition as an asset. The costs were expensed as a one-off non-trading and exceptional item
due to the size, nature and incidence as they were not considered to be reflective of underlying performance in the prior years. Since 1 April 2022
all costs relating to SaaS arrangements have been recorded in underlying EBIT.
The €0.5m restructuring credit in the prior year was a release of surplus provisions following a reassessment of the costs of the Covid-19 cost
action programme in the year ended March 2021.
The total credit of €2.0m (2022: €3.4m charge) was split €2.0m credit (2022: €0.5m) in cost of sales and €nil (2022: €3.9m charge) in
administrative expenses.
Items recorded in finance charges and finance income
The €0.9m credit (2022: €0.1m) relates to the ineffectiveness of the Cumbria PPP project interest rate swaps as a result of a revised repayment
programme for the PPP non-recourse debt.
Amortisation of acquisition intangibles
Amortisation of intangible assets acquired in business combinations of €5.0m (2022: €3.4m) is all recorded in cost of sales.
Exceptional tax credit
Where one-off tax credits or charges are deemed significant they are classified as exceptional and outside of normal tax charges. The prior year
€3.7m exceptional tax credit related to changes in UK tax rates.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 191
SECTION 3. Operating profit and tax CONTINUED
3.4 TAXATION
This section details the accounting polices applied for tax, the current and deferred tax charges or credits in the year, a reconciliation of the
total tax expense to the accounting result and the movements in deferred tax assets and liabilities.
Accounting policy
Current tax is based on taxable profit or loss for the year. Taxable profit differs from profit before tax in the Income Statement because
it excludes items of income or expense that are taxable or deductible in other years or that are never taxable or deductible. The asset
or liability for current tax is calculated using tax rates that have been enacted, or substantively enacted, at the balance sheet date.
Deferred tax is recognised in full where the carrying value of assets and liabilities in the financial statements is different to the corresponding
tax bases used in the computation of taxable profits. Deferred tax liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is probable that the taxable profits will be available against which deductible temporary
differences can be utilised. Deferred tax is calculated at the tax rates that have been enacted, or substantively enacted, at the balance sheet
date. Deferred tax is charged or credited in the Income Statement, except where it relates to items charged or credited directly to equity in
which case the deferred tax is also dealt with in equity. Deferred tax liabilities are not provided on taxable temporary differences arising from
investments in subsidiaries as the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset when there is a legally enforceable
right to offset current tax assets against current tax liabilities, when they relate to income taxes levied by the same taxation authority.
The Group operates primarily in the Netherlands, Belgium, the UK, France and Portugal, all of which have their own tax legislation. Deferred tax
assets and liabilities have been calculated based on the substantively enacted tax rates in the relevant jurisdictions at the balance sheet date
or those rates expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled. The Group has available
tax losses, some of which have been recognised as deferred tax assets based on management’s best estimate of the ability of the Group to
utilise those losses.
Strategic reportGovernance reportFinancial statementsOther information 192
SECTION 3. Operating profit and tax CONTINUED
3.4 TAXATION CONTINUED
Income Statement
The tax charge based on the profit for the year is made up as follows:
Current tax
UK corporation tax
– Current year
– Adjustment in respect of prior years
Overseas tax
– Current year
– Adjustment in respect of prior years
Total current tax charge
Deferred tax
– Origination and reversal of temporary differences in the current year
– Adjustment in respect of prior years
– Exceptional tax credit
Total deferred tax (credit) charge
Total tax charge for the year
The tax on the Group’s profit for the year differs from the UK standard rate of tax of 19% (2022: 19%), as explained below:
Total profit before taxation
Tax charge based on UK tax rate of 19% (2022: 19%)
Effects of:
Adjustment to tax charge in respect of prior years
Profits taxed at overseas tax rates
Non-deductible other items
Unrecognised deferred tax assets
Exceptional tax credit
Total tax charge for the year
2023
€m
2022
€m
1.0
–
26.4
0.2
27.6
(2.5)
1.4
–
(1.1)
26.5
2023
€m
93.1
17.7
1.6
6.3
(1.4)
2.3
–
26.5
1.4
(0.9)
17.1
(0.2)
17.4
(0.8)
–
3.7
2.9
20.3
2022
€m
95.7
18.2
(1.1)
5.7
3.0
(1.8)
(3.7)
20.3
In October 2021 the Dutch government announced an increase in the rate to 25.8% for the period ending 31 March 2023 and subsequent
periods which was enacted in December 2021. In addition, a tightening of the general interest deduction rule (also referred to as the EBITDA
rule) by lowering the 30% EBITDA threshold to 20% was also enacted. As a result, Dutch deferred tax has been calculated at the substantively
enacted rates depending on when the timing differences are expected to reverse.
In the UK Chancellor’s Budget of 3 March 2021 it was announced that the UK corporation tax rate will increase to 25% with effect from 1 April 2023.
This measure was substantively enacted on 24 May 2021. As a result, the UK deferred tax position has been calculated based on the substantively
enacted rate of 25% (2022: 19% and 25%). This resulted in an exceptional tax credit of €3.7m in the prior year.
Uncertain tax positions
The Dutch Tax Authorities have issued assessments adjusting the interest rate applied for tax purposes on some intra group loans from the UK to
the Netherlands. The assessments will be appealed by the Group given that the interest rate charged of 5.9% is based on a detailed transfer
pricing study and the Group will continue to defend the position vigorously. A provision of €1.4m is included in the accounts as a reduction in
deferred tax asset in respect of losses, as this is considered to be the most probable outcome. It is noted that the maximum exposure in respect of
this topic is calculated to be €11.6m (current tax charge €2.1m, deferred tax charge €9.5m) should the Group be wholly unsuccessful in its defence.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
193
SECTION 3. Operating profit and tax CONTINUED
3.4 TAXATION CONTINUED
Deferred tax
Deferred tax is provided in full on temporary differences under the liability method using applicable local tax rates. Deferred tax assets and
liabilities are only offset where there is a legally enforceable right of offset and there is an intention to settle the balances net.
The analysis of the net deferred tax liability and the net deferred tax (credit) charge in the Income Statement is set out below:
BALANCE SHEET
INCOME STATEMENT
Retirement benefit schemes
Tax losses
Derivative financial instruments
Accelerated capital allowances*
Acquisition related intangibles*
Other temporary differences
At 31 March
*Accelerated capital allowances and acquisition related intangibles were previously presented together.
The movement in the deferred tax balance during the year was:
Net deferred tax (liability) asset at 1 April
Acquisitions
Credited (charged) to Income Statement
Credited (charged) to Other Comprehensive Income
Movement in tax arising on share-based compensation
Exchange rate changes
Net deferred tax liability at 31 March
Analysed in the Balance Sheet, after offset of balances within countries, as:
Deferred tax assets
Deferred tax liabilities
Net deferred tax liability at 31 March
2023
€m
2.4
31.1
0.7
(39.0)
(9.9)
3.9
(10.8)
2022
€m
(0.5)
37.1
0.7
(33.4)
(3.8)
(5.5)
(5.4)
2023
€m
(1.0)
(6.0)
(0.2)
(3.2)
1.1
10.4
1.1
2023
€m
(5.4)
(9.6)
1.1
4.5
(0.9)
(0.5)
(10.8)
35.6
(46.4)
(10.8)
2022
€m
(0.8)
–
–
5.1
0.6
(7.8)
(2.9)
2022
€m
0.4
–
(2.9)
(4.3)
1.3
0.1
(5.4)
41.6
(47.0)
(5.4)
The majority (at least 80%) of the €35.6m (2022: €41.6m) deferred tax assets are expected to be recovered after more than one year and the
majority (at least 80%) of the €46.4m (2022: €47.0m) deferred tax liabilities are expected to reverse after more than one year.
As at 31 March 2023, the Group had unused trading losses (tax effect) of €86.6m (2022: €93.3m) available for offset against future profits.
Deferred tax assets have been recognised in respect of €31.1m (2022: €37.1m) of such losses and recognition is based on management’s
projections of future profits in the relevant companies. No deferred tax assets have been recognised in respect of the remaining €55.5m (2022:
€56.2m) due to the uncertainty of future profit streams. In addition there are other unrecognised deferred tax assets in relation to temporary
differences of €43.8m (2022: €38.6m). Tax losses may be carried forward indefinitely in the relevant companies. In terms of the two material
components of the recognised losses, the Dutch fiscal unity losses of €9.6m (2022: €15.4m) are expected to be used during the next two years
due to strong profit streams and losses of €7.5m (2022: €8.3m) relate to highly predictable profit streams from UK interest income on
intercompany receivables. Changes in future profitability will impact the recoverability of the deferred tax assets recognised in respect of
losses. A 10% decrease in profitability would result in a reduction of €3.1m in the value of the deferred tax assets.
No liability has been recognised on the aggregate amount of temporary differences associated with undistributed earnings of subsidiaries.
This is because the Group is in a position to control the timing and method of the reversal of the differences and it is probable that such
differences will not give rise to a tax liability in the foreseeable future. The total temporary difference at 31 March 2023 amounted to €280.9m
(2022: €243.8m) and unrecognised deferred tax estimated to arise on the unremitted earnings is €nil (2022: €nil) which would relate to taxes
payable on repatriation and dividend withholding taxes levied by overseas jurisdictions. UK tax legislation relating to company distributions
provides for exemption from tax for most repatriated profits, subject to certain exemptions.
Strategic reportGovernance reportFinancial statementsOther information 194
SECTION 3. Operating profit and tax CONTINUED
3.5 EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit attributable to the owners of the parent entity by the weighted average number
of ordinary shares during the year excluding shares held by the Employee Share Trust.
Diluted earnings per share is calculated by dividing profit for the year attributable to the owners of the parent entity by the weighted
average number of ordinary shares during the year plus the weighted average number of any commitments made by the Group to issue
shares in the future.
Underlying basic and diluted earnings per share exclude non-trading and exceptional items, net of related tax. Non-trading and exceptional
items are those items that are disclosed separately on the face of the Income Statement, because of their size or incidence, to enable
a better understanding of performance. The Directors believe that adjusting earnings per share in this way enables comparison with
historical data calculated on the same basis to reflect the business performance in a consistent manner and reflect how the business is
managed and measured on a day to day basis.
2023
2022
Basic
Dilutions
Diluted
Basic
Dilutions
Diluted
Weighted average number of shares (million)
Profit after tax (€m)
Non-controlling interests (€m)
Profit after tax attributable to ordinary shareholders (€m)
Basic earnings per share (cents)
79.4
66.6
(3.7)
62.9
79
0.2
–
–
–
–
79.6
66.6
(3.7)
62.9
79
79.7
75.4
(0.9)
74.5
93
0.4
–
–
–
–
The reconciliation between underlying earnings per share and basic earnings per share is as follows:
Underlying earnings per share/Underlying profit after tax attributable to ordinary shareholders
Adjustments:
Non-trading and exceptional items
Tax on non-trading and exceptional items
Exceptional tax
Basic earnings per share/Earnings after tax attributable to ordinary shareholders
Diluted underlying earnings per share/Underlying profit after tax attributable
to ordinary shareholders
Diluted basic earnings per share/Earnings after tax attributable to ordinary shareholders
2023
Cents
90
€m
71.9
2022
Cents
98
(13)
(10.6)
(12)
2
–
79
90
79
1.6
–
62.9
71.9
62.9
3
4
93
98
93
80.1
75.4
(0.9)
74.5
93
€m
77.9
(9.5)
2.4
3.7
74.5
77.9
74.5
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 195
SECTION 4. Operating assets and liabilities
This section contains Balance Sheet notes showing the assets and liabilities used to generate the Group’s results and the related accounting
policies.
4.1 INTANGIBLE ASSETS
Accounting policy
Goodwill represents the excess of the purchase consideration over the fair value of the Group’s share of the net identifiable assets at the date
of acquisition and is measured at cost less accumulated impairment losses. Goodwill arising on acquisitions prior to the date of transition to
IFRS (31 March 2004) has been retained at the previous UK GAAP net book value following impairment tests.
For the purpose of impairment testing, goodwill is allocated to those cash generating units (CGUs) or groups of CGUs that are expected to
benefit from the synergies of the business combination. Goodwill is tested annually for impairment or more frequently if events or changes in
circumstances indicate a potential impairment. Any impairment is charged immediately to the Income Statement and is not reversed in a
subsequent period. In conducting the impairment review on goodwill and intangibles, management is required to make estimates of pre-tax
discount rates, future profitability and growth rates. The pre-tax discount rates are derived from the Group’s weighted average cost of capital
(WACC) which takes into account the capital structure of the Group, the cost of risk-free rate finance and the relative volatility of the equity of
the Group compared to the market and is adjusted by management as considered appropriate for each CGU.
Landfill void represents the value of landfill capacity to deposit waste in two landfill sites in the Netherlands. The initial landfill void was
capitalised at fair value on the acquisition of a Dutch operation in 2006 and further void has been acquired in relation to the Maasvlakte
landfill site in Mineralz & Water and capitalised at cost. The assets are amortised over their estimated useful life on a void usage basis and
measured at cost less accumulated amortisation. The estimated remaining useful life is up to 14 years.
Relating to the Group’s software and systems development an internally generated intangible asset is recognised when an asset is created that
can be identified, it is probable that the asset will generate future economic benefits that the Group controls and the development cost can be
reliably measured. With regard to configuration and customisation costs incurred when implementing Software as a Service (SaaS)
arrangements:
• In SaaS arrangements where the Group controls the underlying software, configuration and customisation costs are capitalised as part
of bringing the identified intangible asset into use.
• Where the Group does not control the underlying software, but the related configuration and customisation costs are not distinct from
access to the software, these costs are expensed over the term of the SaaS contract.
• In all other circumstances, configuration and customisation costs are recognised as an expense as incurred, except in the limited instances
where these costs result in a separately identifiable intangible asset.
Other intangible assets are capitalised on the basis of the fair value of the assets acquired or on the basis of costs incurred to purchase and
bring the assets into use. They are subsequently measured at cost less accumulated amortisation.
Amortisation is charged over the estimated useful life on a straight-line basis, as follows:
Contract right relating to leasehold land
Contract right relating to PPP contracts in Municipal
Computer software
Acquisition related intangibles:
Waste permits and licences*
Customer relationships*
Term of the lease
Term of the contract
Up to 5 years
5 to 34 years
Up to 14 years
*The remaining useful life of customer relationships is based on analysis of historical churn patterns of the client base and for permits where the term is indefinite and are related to a leased
site, the useful life is the remaining term of the leasehold land.
Strategic reportGovernance reportFinancial statementsOther information
196
SECTION 4. Operating assets and liabilities CONTINUED
4.1 INTANGIBLE ASSETS CONTINUED
Intangible assets are analysed as follows:
Goodwill
€m
Landfill void
€m
Computer
software
and others
€m
Acquisition
related
intangibles
€m
Cost
At 1 April 2021
Additions
Acquisition through business combinations (note 6.1)
Disposals
Reclassifications
At 31 March 2022
Additions
Acquisition through business combinations (note 6.1)
Disposals
Exchange rate changes
At 31 March 2023
Accumulated amortisation and impairment
At 1 April 2021
Amortisation charge
Impairment charge
Disposals
At 31 March 2022
Amortisation charge
Disposals
Exchange rate changes
At 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 1 April 2021
624.8
–
–
–
–
624.8
–
17.4
–
–
642.2
73.2
–
–
–
73.2
–
–
–
73.2
569.0
551.6
551.6
27.3
1.6
–
–
–
28.9
1.7
–
–
–
30.6
22.0
1.2
–
–
23.2
1.6
–
–
24.8
5.8
5.7
5.3
Total
€m
768.2
9.3
0.3
(9.2)
(0.4)
768.2
8.7
45.3
(0.2)
(0.5)
42.4
7.7
–
(9.1)
(0.4)
40.6
7.0
–
(0.1)
(0.5)
73.7
–
0.3
(0.1)
–
73.9
–
27.9
(0.1)
–
47.0
101.7
821.5
26.5
4.2
2.3
(8.9)
24.1
3.9
(0.1)
(0.5)
27.4
19.6
16.5
15.9
51.6
3.4
–
(0.1)
54.9
5.0
(0.1)
–
59.8
41.9
19.0
22.1
173.3
8.8
2.3
(9.0)
175.4
10.5
(0.2)
(0.5)
185.2
636.3
592.8
594.9
Of the total amortisation charge of €10.5m (2022: €8.8m), €5.0m (2022: €3.4m) related to acquisition related intangible assets which has been
charged in cost of sales. Of the remaining amortisation expense of €5.5m (2022: €5.4m), €1.8m (2022: €1.3m) has been charged in cost of sales
and €3.7m (2022: €4.1m) has been charged in administrative expenses.
The prior year impairment charge of €2.3m is a result of a detailed review of computer software assets.
The net book value of acquisition related intangibles of €41.9m (2022: €19.0m) includes customer relationships of €32.6m (2022: €14.6m) and
permits of €9.1m (2022: €4.1m).
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 197
SECTION 4. Operating assets and liabilities CONTINUED
4.1 INTANGIBLE ASSETS CONTINUED
Goodwill impairment
Impairment testing is carried out at a CGU level on an annual basis.
The material CGUs are Netherlands Commercial Waste, Belgium Commercial Waste and Mineralz & Water. A summary of the closing net book
value of goodwill by reportable segment is set out below:
Netherlands Commercial Waste
Belgium Commercial Waste
Commercial Waste
Mineralz & Water
Specialities
Total goodwill
2023
€m
279.5
136.3
415.8
129.5
23.7
569.0
2022
€m
262.1
136.3
398.4
129.5
23.7
551.6
The Group estimates the recoverable amount of a CGU using a value in use model by projecting cash flows for the next five years together with
a terminal value using a long-term growth rate. However, given a landfill closure in Mineralz & Water CGU it is more appropriate to use a 14 year
model for projecting cash flows. The five year plans used in the impairment models are based on management’s past experience and future
expectations of performance. They also reflect the planned changes in the CGUs as a result of improvement initiatives and actions instigated
in the current year. The key assumptions underpinning the recoverable amounts of the CGUs tested for impairment are forecast revenue and
underlying EBIT, taking into account the increase in energy prices and other inflationary pressures as a result of recent macroeconomic
developments. The forecast revenues in these models are based on management’s predictions of overall market growth rates, including both
volume and price. The cash flows include management’s estimate of the impact of the ongoing high levels of inflation, and an assumption that
recyclate prices remain at long-term averages despite the expected increased demand for these products driven by climate change-related
targets and legislation. The pre-tax discount rate reflects the Group’s assessment of the risks related to the CGUs and the countries in which
they operate.
For each of the material CGUs, the key assumptions used in the value in use calculations are shown below:
2023
Revenue (% annual growth rate from year 1 to year 5)
Underlying EBIT margin (average % of revenue for years 1 to year 5)
Long-term growth rate*
Pre-tax discount rate
Netherlands
Commercial
Waste
Belgium
Commercial
Waste
Mineralz &
Water
2.7%
6.5%
2.0%
8.8%
4.1%
8.0%
2.0%
9.6%
3.7%
7.3%
2.0%
8.9%
*For the Mineralz & Water CGU the terminal long-term growth rate of 2.0% is applied to all results with the exception of landfills where permits cease.
2022
Revenue (% annual growth rate from year 1 to year 5)
Underlying EBIT margin (average % of revenue for years 1 to year 5)
Long-term growth rate*
Pre-tax discount rate
Netherlands
Commercial
Waste
Belgium
Commercial
Waste
Mineralz &
Water
2.9%
8.0%
2.0%
8.7%
3.5%
8.9%
2.0%
9.7%
2.5%
7.7%
2.0%
9.0%
*For the Mineralz & Water CGU the terminal long-term growth rate of 2.0% is applied to all results with the exception of landfills where permits cease.
A long-term growth rate of 2% is considered an appropriate representation of the long-term growth rate for the industry and in the countries in
which the Group operates.
Sensitivity to changes in assumptions
The Group performs sensitivity analysis on the impairment testing by considering reasonably possible changes in the key assumptions used.
This includes weaker macroeconomic conditions resulting in a volume decline, a significant decline in recyclate prices and operational
downtime in some of our facilities. For all CGUs a change in discount rate of 1% demonstrated that there is still appropriate headroom and it is
concluded that no reasonably possible change to this or the other assumptions would result in an impairment charge.
Strategic reportGovernance reportFinancial statementsOther information
198
SECTION 4. Operating assets and liabilities CONTINUED
4.2 PROPERTY, PLANT AND EQUIPMENT
Accounting policy
Property, plant and equipment, except for freehold land and assets under construction, is stated at cost less accumulated depreciation and
provision for impairment. Freehold land is not depreciated. Cost includes the original purchase price of the asset and the costs attributable to
bringing the asset to its working condition for its intended use. The asset’s residual values and useful lives are reviewed and adjusted if
appropriate at the end of each reporting period.
Where a government grant has been received in relation to an item of capital expenditure it is generally deducted from the carrying amount of
the asset purchased once all the conditions have been met. However, where the grant has been received and the conditions of the grant have
not been fully met then the government grant is recognised as a liability at the value of the cash received and is subsequently transferred to
the asset once all conditions are fully met.
Assets other than goodwill are reviewed for impairment whenever events or circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are
discounted to their present value. An impairment loss is recognised immediately as an operating expense and at each subsequent reporting
date the impairment is reviewed for possible reversal.
Depreciation is provided to write off cost (less the expected residual value) on a straight-line basis over the expected useful economic lives
as follows:
Buildings
Landfill site development costs including engineering works Up to 30 years (over the operational life of the site)
Plant and installations
Trucks, cars and service vehicles
Other items of plant and machinery
Computer equipment
Fixtures and fittings
Up to 20 years
Up to 12 years
Up to 15 years
Up to 5 years
Up to 10 years
Up to 30 years
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
SECTION 4. Operating assets and liabilities CONTINUED
4.2 PROPERTY, PLANT AND EQUIPMENT CONTINUED
Property, plant and equipment are analysed as follows:
Land and
buildings
€m
Landfill
sites
€m
Plant and
machinery
€m
Cost
At 1 April 2021
Additions
Acquisition through business combinations (note 6.1)
Disposals
Transferred to Assets held for sale (note 6.3)
Reclassifications
Exchange rate changes
At 31 March 2022
Additions
Acquisition through business combinations (note 6.1)
Disposals
Transferred to Assets held for sale (note 6.3)
Transferred from right-of-use asset to property, plant and equipment
Reclassifications
Exchange rate changes
At 31 March 2023
Accumulated depreciation and impairment
At 1 April 2021
Depreciation charge
Impairment charge
Disposals
Transferred to Assets held for sale (note 6.3)
Exchange rate changes
At 31 March 2022
Depreciation charge
Impairment charge
Reversal of a prior year’s impairment charge
Disposals
Transferred to Assets held for sale (note 6.3)
Transferred from right-of-use asset to property, plant and equipment
Reclassifications
Exchange rate changes
At 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 1 April 2021
476.6
17.3
–
(1.5)
(6.7)
–
0.1
485.8
28.4
12.5
(7.8)
–
0.2
1.8
(0.3)
520.6
167.7
14.0
0.2
(1.1)
(4.1)
0.1
176.8
14.4
0.2
–
(5.6)
–
0.1
1.8
(0.3)
187.4
333.2
309.0
308.9
199
Total
€m
1,277.7
73.3
0.2
(54.9)
(6.7)
0.4
0.1
1,290.1
117.9
19.0
(43.3)
(6.8)
7.0
1.1
(0.6)
68.4
0.5
–
(0.5)
–
–
–
68.4
0.1
–
(1.8)
–
–
–
–
732.7
55.5
0.2
(52.9)
–
0.4
–
735.9
89.4
6.5
(33.7)
(6.8)
6.8
(0.7)
(0.3)
66.7
797.1
1,384.4
52.1
2.2
–
(0.4)
–
–
53.9
1.8
–
–
(1.5)
–
–
–
–
497.2
53.1
5.2
(49.7)
–
–
505.8
53.6
1.5
(2.0)
(31.3)
(6.7)
4.9
(0.7)
(0.2)
717.0
69.3
5.4
(51.2)
(4.1)
0.1
736.5
69.8
1.7
(2.0)
(38.4)
(6.7)
5.0
1.1
(0.5)
54.2
524.9
766.5
12.5
14.5
16.3
272.2
230.1
235.5
617.9
553.6
560.7
Depreciation expense of €67.4m (2022: €66.6m) has been charged in cost of sales and €2.4m (2022: €2.7m) in administrative expenses.
The current year impairment charge of €1.7m has arisen in the Netherlands Commercial division partly due to a fire at one of the sites and a
detailed review of carrying value of assets including trucks. The reversal of a prior year’s impairment charge relates to the Maltha CGU as a
result of improved performance at a specific site. The prior year impairment charge of €5.4m related to several sites across the Commercial
division following detailed reviews which included €1.4m in relation to the advanced sorting project in Belgium. The impairment charge of
€1.7m (2022: €5.4m) has been charged to cost of sales and the reversal of the prior year impairment has been credited to non-trading and
exceptional cost of sales.
Strategic reportGovernance reportFinancial statementsOther information 200
SECTION 4. Operating assets and liabilities CONTINUED
4.2 PROPERTY, PLANT AND EQUIPMENT CONTINUED
Included within the net book value of property, plant and equipment of €617.9m (2022: €553.6m) are assets under construction of which
€26.7m (2022: €16.5m) is plant and machinery and €6.1m (2022: €2.5m) is land and buildings. The net book value of plant and machinery of
€272.2m (2022: €230.1m) includes €149.3m (2022: €109.7m) of plant and installations, €51.4m (2022: €55.5m) of machinery and €64.8m (2022:
€59.3m) of containers.
4.3 RIGHT-OF-USE ASSETS
Accounting policy
Right-of-use assets are recognised at the lease liability commencement date and are initially measured at cost which comprises the initial
amount of the lease liability adjusted for any lease payments made at or before the commencement date and initial direct costs incurred.
Where the Group is contractually required to dismantle, remove or restore the leased asset at the inception of the lease the amount of the
related dilapidation provision is recognised in the cost of the right-of-use asset. Where a right-of-use asset is acquired in an IFRS 3 Business
combination, where appropriate, the asset value is adjusted to reflect the terms which are either favourable or unfavourable compared to
market terms.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term.
If the lessor transfers ownership of the underlying asset to the Group by the end of the lease term or the cost of the right-of-use asset reflects
that the Group will exercise a purchase option, then the right-of-use asset is depreciated over the useful life of the underlying asset, which is
determined on the same basis as those in property, plant and equipment. The lease liability is remeasured if the Group changes its
assessment of whether it will exercise a purchase extension or termination option or if there is a revision to fixed lease payments. When the
lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset. The Group
leases out a limited number of right-of-use assets which are classified as operating leases from a lessor perspective with the exception of a
sub-lease which is classified as a finance sub-lease.
Right-of-use assets are reviewed for impairment whenever events or circumstances indicate that the carrying value may not be recoverable
following the same approach as property, plant and equipment as stated in note 4.2.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 SECTION 4. Operating assets and liabilities CONTINUED
4.3 RIGHT-OF-USE ASSETS CONTINUED
Right-of-use assets are analysed as follows:
Cost
At 1 April 2021 - restated*
Additions/modifications
Disposals
Exchange rate changes
At 31 March 2022 - restated
Additions/modifications
Acquisition through business combinations (note 6.1)
Disposals
Transferred from right-of-use asset to property, plant and equipment
Reclassifications
Exchange rate changes
At 31 March 2023
Accumulated depreciation and impairment
At 1 April 2021 - restated*
Depreciation charge
Impairment charge
Disposals
Exchange rate changes
At 31 March 2022 - restated
Depreciation charge
Impairment charge
Reversal of a prior year’s impairment charge
Disposals
Transferred from right-of-use asset to property, plant and equipment
Reclassifications
Exchange rate changes
At 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 1 April 2021
201
Restated*
Land and
buildings
€m
Plant and
machinery
€m
Restated*
Total
€m
135.4
9.9
(2.2)
0.2
143.3
18.2
30.9
(7.5)
(0.2)
1.3
(0.6)
178.3
17.2
(6.2)
–
189.3
39.2
7.5
(9.3)
(6.8)
(2.4)
(0.1)
313.7
27.1
(8.4)
0.2
332.6
57.4
38.4
(16.8)
(7.0)
(1.1)
(0.7)
185.4
217.4
402.8
25.6
10.4
0.2
(1.3)
0.2
35.1
11.4
–
(0.5)
(3.1)
(0.1)
(0.3)
(0.6)
54.3
34.4
0.5
(5.5)
–
83.7
35.9
2.3
–
(8.3)
(4.9)
(0.8)
(0.1)
79.9
44.8
0.7
(6.8)
0.2
118.8
47.3
2.3
(0.5)
(11.4)
(5.0)
(1.1)
(0.7)
41.9
107.8
149.7
143.5
108.2
109.8
109.6
105.6
124.0
253.1
213.8
233.8
*The comparatives have been restated due to a prior period adjustment as explained in section 1 Basis of preparation.
The net book value of plant and machinery right-of-use assets includes €0.9m (2022: €1.7m) of plant and installations, €97.5m (2022: €90.1m) of
machinery including trucks and €11.2m (2022: €13.7m) of company cars.
Depreciation expense of €40.4m (2022: €37.3m) has been charged in cost of sales and €6.9m (2022: €7.5m) in administrative expenses.
The impairment charge of €2.3m related to €1.3m of assets in UK Municipal onerous contracts which were recorded as a utilisation of the
onerous contract provision and €1.0m was charged to cost of sales in relation to the Netherlands Commercial division principally due to a
plant reconfiguration which has resulted in an asset being scrapped earlier than previously expected. The prior year impairment charge of
€0.7m was principally a small number of trucks in the Commercial division.
Strategic reportGovernance reportFinancial statementsOther information 202
SECTION 4. Operating assets and liabilities CONTINUED
4.4 INVESTMENTS AND LOANS TO ASSOCIATES AND JOINT VENTURES
Accounting policy
Investments in associates and joint ventures are accounted for using the equity method of accounting and are initially recognised at cost or at fair
value in the case of a disposal of the majority shareholding. The cumulative post-acquisition profits or losses and movements in Other
Comprehensive Income are adjusted against the carrying amount of the investment. When the Group’s share of losses exceeds the carrying
amount of the joint venture or associate, the carrying amount is reduced to nil and recognition of further losses is discontinued except to the
extent that the Group has incurred legal or constructive obligations or made payments on behalf of the joint venture or associate. Accounting
policies of associates and joint ventures have been adjusted where necessary to ensure consistency with the policies of the Group. Where there is
evidence that the investment in an associate or joint venture has been impaired the carrying value of the investment is tested for impairment in the
same way as other non-financial assets.
For the other unlisted investments the Group made an irrevocable election to classify these at fair value through Other Comprehensive Income
rather than profit or loss because this is considered to be more appropriate for these strategic investments. They were initially recorded at fair
value and then remeasured at subsequent reporting dates with the unrealised gains and losses recognised in Other Comprehensive Income.
Short-term investments are measured at fair value through profit or loss with unrealised gains and losses recognised in the Income Statement.
Loans to associates and joint ventures are measured at amortised cost and where appropriate a 12-month expected credit loss allowance is
recorded on initial recognition. If there is subsequent evidence of a significant increase in the credit risk the allowance is increased to reflect
the full lifetime expected credit loss.
The carrying amount of investments and loans to associates and joint ventures are as follows:
At 1 April 2021
Additions
Transferred to Assets held for sale (note 6.3)
Share of retained profits
Dividend income
Fair value adjustment on cash flow hedges
Fair value movement on short-term investments
Impairment charge
At 31 March 2022
Additions
Repayments
Share of retained profits
Dividend income
Fair value adjustment on cash flow hedges
Fair value movement on short-term investments
Impairment charge
Disposals
Reclassification
Exchange rate changes
At 31 March 2023
LOANS
Loans to
associates and
joint ventures
€m
INVESTMENTS
Joint
ventures
€m
Associates
€m
Other unlisted
investments
€m
Short-term
investments
€m
Total
investments
€m
0.9
–
–
–
–
–
–
–
0.9
0.4
(0.3)
–
–
–
–
–
–
–
–
1.0
1.9
–
–
0.1
(0.5)
–
–
–
1.5
–
–
0.5
(0.1)
–
–
–
(0.1)
(0.7)
–
1.1
10.7
–
(0.7)
0.4
(0.8)
0.5
–
(1.9)
8.2
2.0
–
(0.5)
(0.5)
0.3
–
(0.9)
(0.1)
0.7
(0.1)
9.1
4.6
–
–
–
–
–
–
–
4.6
–
–
–
–
–
–
–
–
–
–
9.3
2.2
–
–
–
–
(0.4)
–
11.1
–
–
–
–
–
(0.2)
–
–
–
–
4.6
10.9
26.5
2.2
(0.7)
0.5
(1.3)
0.5
(0.4)
(1.9)
25.4
2.0
–
–
(0.6)
0.3
(0.2)
(0.9)
(0.2)
–
(0.1)
25.7
Of the loans to associates and joint ventures totalling €1.0m (2022: €0.9m), €0.8m (2022: €0.9m) are current and €0.2m (2022: €nil) are
non-current. Total investments are split €10.9m current (2022: €11.1m) and €14.8m non-current (2022: €14.3m).
Investments in joint ventures are held at €nil when the Group’s share of losses exceeds the carrying amount. The Group has not recognised an
investment value in relation to the UK Municipal Wakefield Waste Holdings Limited joint venture as there are insufficient future cash flows to
support a carrying value. The Group’s share of profits in the year was €3.5m (2022: €3.1m) which resulted in a cumulative profit of €4.6m (2022:
€1.1m).
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
203
SECTION 4. Operating assets and liabilities CONTINUED
4.4 INVESTMENTS AND LOANS TO ASSOCIATES AND JOINT VENTURES CONTINUED
Where the associate or joint venture holds non-recourse PPP debt there is a restriction on payment of dividends, which is due to the terms of
the financing facility agreements and as such requires lender approval.
Details of joint ventures and associated investments are shown in note 8.1. No joint venture or associate is considered individually material to
the Group for further disclosure.
4.5 FINANCIAL ASSETS RELATING TO PPP CONTRACTS
Accounting policies and key judgements
Financial assets relating to PPP contracts are classified as financial assets at amortised cost and are initially recognised at the fair value of
consideration receivable and subsequently at amortised cost. These service concession arrangements under IFRIC 12 represent the present
value of the future cash flows of the contract. These cash flows are dependent on, amongst other things, tonnages, indexation, recycling rates
and labour costs.
The IFRS 9 general approach is applied in relation to expected credit loss which requires an allowance to be recorded on initial recognition if
appropriate and then at each reporting date an assessment is made to determine the changes in the risk of default occurring over the
expected life of the financial asset. The UK Municipal division entered into PPP long-term waste management contracts with local authorities
which included the infrastructure capital costs. UK local authorities have historically held a strong credit profile with the capacity to meet
financial commitments and none have ever defaulted. These financial assets are assessed to have low credit risk based on low risk of default,
the vital nature of the service being provided and strong financial capacity to meet contractual cash flow obligations in the near term. Adverse
changes in economic and business conditions in the longer term may, but will not necessarily, reduce the local authority’s ability to fulfil its
obligations.
The Group is the operator for one class of service concession arrangements, that of the provision of waste treatment and waste treatment
facilities, and these are classified as service concession arrangements in accordance with IFRIC 12. If the Group underperforms, including
failure to divert waste from landfill, the contract can be terminated before the end of its term.
The Group’s UK PPP arrangements relate to the construction and operation of waste management facilities for local authorities and at the end
of the concession arrangement the facility will be handed over to the local authority. The building of the facilities was governed by the
engineer, procure and construct contract entered into by the Group at that time. The construction work was undertaken by third-party
contractors with drawdowns of financing from the UK PPP funders used to pay the subcontractor for the construction works. The Group
considered all relevant factors in the contractual arrangements between the parties to determine whether the Group acted as agent or
principal during the construction phase. On the basis that the construction contractor was known to the local authority at the date of financial
close and in view of the negligible credit risk taken by the Group, on balance, despite some overall risk residing with the Group for delivery of
services, the Group acted as agent versus principal in the provision of construction services.
In light of these conclusions and the historical presentation of the revenue and costs associated with the construction services net in the
Income Statement, we consider that the most appropriate classification of the PPP non-recourse debt cash flows in the Statement of Cash
Flows is as financing outflows and capital received in relation to PPP financial assets as investing cash flows and not as operating cash flows.
This classification has been consistently applied to all periods presented in the financial statements.
Strategic reportGovernance reportFinancial statementsOther information 204
SECTION 4. Operating assets and liabilities CONTINUED
4.5 FINANCIAL ASSETS RELATING TO PPP CONTRACTS CONTINUED
The table below sets out the Group’s interest in service concession arrangements as at 31 March 2023. There have been no changes to any of
the arrangements during the year ended 31 March 2023.
Contract
Argyll & Bute
Cumbria
Wakefield
Barnsley, Doncaster
and Rotherham
East London
Waste Authority
Financial close
September 2001
June 2009
January 2013
Full-Service
Commencement
April 2003
April 2013
Contract Expiry
Interests in Special Purpose Vehicle
September 2026
June 2034
Renewi: 100%
Renewi: 100%
December 2015
February 2038
Renewi: 50.001%
Equitix Infrastructure 4 Limited: 49.999%
March 2012
July 2015
June 2040
Renewi: 100%
December 2002
August 2007
December 2027
Renewi: 20%
JLEN Environmental Assets Group (UK) Limited: 80%
The movements in financial assets during the year were as follows:
At 1 April 2021
Income recognised in the Income Statement: Interest Income (note 5.4)
Advances
Repayments
Exchange rate changes
At 31 March 2022
Income recognised in the Income Statement: Interest Income (note 5.4)
Advances
Repayments
Exchange rate changes
At 31 March 2023
Current
Non-current
At 31 March 2023
Current
Non-current
At 31 March 2022
€m
149.1
9.0
0.3
(16.1)
1.1
143.4
8.6
0.5
(16.1)
(5.4)
131.0
7.6
123.4
131.0
7.7
135.7
143.4
At 31 March 2023 and 2022 there was no expected credit loss allowance recorded in relation to the financial assets relating to PPP contracts as
explained in note 5.7.
The table below reconciles the financial asset repayments to the Statement of Cash Flows:
Capital received in respect of PPP financial assets included in outflows in respect of PPP arrangements under the financial asset
model net of capital received in cash flows from investing activities
Interest in relation to PPP financial assets included in finance income in cash flows from investing activities
2023
€m
6.6
9.5
16.1
2022
€m
6.2
9.9
16.1
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 SECTION 4. Operating assets and liabilities CONTINUED
4.6 CAPITAL COMMITMENTS
Contracts placed for future intangible assets
Contracts placed for future capital expenditure on property, plant and equipment
Contracts placed for future right-of-use assets
Contracts placed for future capital expenditure on financial assets
4.7 INVENTORIES
Accounting policy
Inventories are stated at the lower of cost and net realisable value and are measured on a first in first out basis.
Inventories are analysed as follows:
Raw materials and consumables
Finished goods
205
2023
€m
7.6
53.1
17.7
–
2023
€m
15.0
10.2
25.2
2022
€m
2.7
38.6
38.8
0.3
2022
€m
13.8
8.7
22.5
In the year there was a write down of €0.1m (2022: €0.3m) of inventories to net realisable in the Commercial Waste division. The charge was
recognised as a cost of sale.
4.8 TRADE AND OTHER RECEIVABLES
Accounting policy
Trade receivables and accrued income do not carry interest and are initially recognised at the transaction price and are subsequently
measured at amortised cost net of impairment loss allowances. Accrued income relates to the Group’s rights to consideration for work
completed but not billed at the reporting date until they become unconditional, at which point they are transferred to trade receivables.
Unbilled amounts arise when revenue is recognised prior to an invoice being raised to the customer; typically, this arises when supporting
documentation is required to be delivered with the invoice, the invoice needs to be agreed with the customer prior to issue or revenue is
recognised over time with the invoice only raised on completion of all the performance obligations.
The Group applies the IFRS 9 simplified approach to measuring expected credit losses (ECL) which uses a lifetime expected allowance for all
trade receivables and accrued income and includes an assessment of both the current and forecast conditions at the reporting date. To
measure the ECL, trade receivables and accrued income have been assessed by the divisions and grouped based on ageing. Accrued income
relates to unbilled services provided and has substantially the same risk characteristics as trade receivables. The Group has therefore
concluded that the expected loss rates for trade receivables are a reasonable approximation of the loss rates for accrued income. The ECL on
trade receivables and accrued income is estimated using a provision matrix by reference to payment profiles of revenue. In addition
outstanding trade receivables and accrued income are reviewed on a detailed customer by customer basis taking into account general
economic conditions of the industry in which the debtor operates in, past default experience and an analysis of the current customer financial
position. The Group has not seen a marked increase in trade receivable write-offs as a result of the increased energy prices and high
inflationary environment however based on external data it is expected that the number of bankruptcies will increase.
For receivables other than trade receivables and accrued income the general approach under IFRS 9 is applied which requires an ECL
allowance to be recorded on initial recognition if appropriate and then at each reporting date an assessment is made to determine any
changes in the risk of default occurring over the expected life of the receivable.
Strategic reportGovernance reportFinancial statementsOther information
206
SECTION 4. Operating assets and liabilities CONTINUED
4.8 TRADE AND OTHER RECEIVABLES CONTINUED
The Group has an invoice finance facility whereby certain of its trade receivables are sold for an upfront cash payment to a third party on a regular
basis and are recognised to the extent of the Group’s continuing involvement. For the trade receivables derecognised the Group has not retained
substantially all the risks and rewards of ownership and control has not passed to the third party. The Group continues to recognise part of the
trade receivable according to the Group’s continuing exposure to the risks and rewards, the value is minimal and is determined by the extent to
which the Group is exposed to any remaining late payment risk. The Group continues to perform the servicing of the receivables sold and is not
authorised to use the receivables sold other than in its capacity as servicer. The value of this service is not considered material for specific
disclosure.
Other receivables includes amounts recoverable under invoice finance arrangements from the third party which are classified at fair value
through profit and loss. The classification is appropriate as the receivables are held within a business model which has the objective to sell
contractual cash flows. Amounts owed under leases where the Group is the lessor and the terms of the lease meet the definition of a finance
lease are also classified as other receivables.
Trade and other receivables are analysed as follows:
Non-current assets
Other receivables
Prepayments
Current assets
Trade receivables
Accrued income
Expected credit loss allowance
Trade receivables and accrued income – net
Other receivables
Prepayments
The carrying amounts of trade and other receivables are denominated in the following currencies:
Euro
Sterling
2023
€m
1.0
2.7
3.7
192.8
86.7
(22.2)
257.3
16.6
15.7
289.6
2023
€m
262.0
31.3
293.3
2022
€m
0.9
4.2
5.1
177.8
86.2
(26.0)
238.0
16.5
14.8
269.3
2022
€m
237.3
37.1
274.4
As at 31 March 2023 the total value of trade receivables subject to the invoice finance facilities, which are derecognised and therefore not
included above, was €103.3m (2022: €90.4m). The Group recognises the continuing involvement carrying amount in trade receivables of €1.2m
(2022: €0.3m) and therefore the net amount of transferred assets was €102.1m (2022: €90.1m). The carrying amount of the associated liability
was €1.2m (2022: €0.3m). The Group considers that the carrying amount of the continuing involvement asset and related liability equals the
fair value.
The amount owed to the Group from the financial institutions providing invoice finance facilities is €10.8m (2022: €9.5m). This represents the
portion of the receivable that has been sold that is not advanced but is covered by credit insurance and is included within other receivables.
This classification also includes €1.0m (2022: €1.0m) relating to the net investment in leases where the Group acts as lessor of which €0.9m
(2022: €0.9m) is non-current and €0.1m (2022: €0.1m) is current. No financial assets within other receivables were impaired in the current or
prior year.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
207
SECTION 4. Operating assets and liabilities CONTINUED
4.8 TRADE AND OTHER RECEIVABLES CONTINUED
The expected credit loss allowance for trade receivables and accrued income is equivalent to 8% (2022: 10%) of gross trade receivables and
accrued income and the movement in the loss allowance is shown below:
At 1 April
Charged to Income Statement
Released to Income Statement
Utilised
Exchange rate changes
At 31 March
2023
€m
26.0
0.4
(2.9)
(0.7)
(0.6)
22.2
2022
€m
25.9
0.6
–
(0.6)
0.1
26.0
The expected credit loss allowance includes €14.8m (2022: €15.4m) in relation to 100% of the gross receivable balance for the receivables
relating to the terminated Derby contract in the UK Municipal business line within Specialities. There has been no change in the value of this
loss allowance with the decrease from 2022 to 2023 representing a movement in foreign exchange. For both March 2023 and March 2022 this
receivable is included in the category of more than 180 days past due.
The expected credit loss allowance for trade receivables and accrued income is as follows:
31 March 2023
Expected loss rate %
Gross carrying amount (€m)
Expected credit loss allowance (€m)
31 March 2022
Expected loss rate %
Gross carrying amount (€m)
Expected credit loss allowance (€m)
More than
30 days
past due
More than
90 days
past due
More than
180 days
past due
6%
6.8
0.4
18%
3.4
0.6
11%
5.5
0.6
30%
2.0
0.6
84%
22.2
18.7
90%
21.6
19.5
Current
1%
245.0
2.5
2%
237.0
5.3
Total
8%
279.5
22.2
10%
264.0
26.0
The increase in receivables in the Statement of Cash Flows of €12.2m differs to the balance sheet movement of €18.9m by €6.7m mainly as a
result of acquisitions and disposal. The impact of assets acquired or disposed is presented in the Statement of Cash Flows within the €53.5m
acquisition of subsidiary and the €1.1m disposal of subsidiary and business assets net of acquisition of business assets.
Strategic reportGovernance reportFinancial statementsOther information
208
SECTION 4. Operating assets and liabilities CONTINUED
4.9 TRADE AND OTHER PAYABLES AND OTHER NON-CURRENT LIABILITIES
Accounting policy
Trade and other payables are not interest bearing and are measured initially at fair value and subsequently held at amortised cost.
Where a government grant has been received in relation to an item of capital expenditure it is generally deducted from the carrying amount of the
asset purchased once all relevant conditions, such as completion of the project and an independent audit of costs, have been met. In circumstances
where the grant has been received and all conditions of receipt have not been met the government grant is recognised as a liability at the value of
the cash received. On satisfaction of all conditions it is subsequently transferred to plant and equipment.
Trade and other payables and other non-current liabilities are analysed as follows:
Non-current liabilities
Accruals and other payables
Other tax and social security payables
Deferred revenue
Government grants
Current liabilities
Trade payables
Accruals and other payables
Other tax and social security payables
Deferred revenue
Government grants
2023
€m
17.6
10.8
5.2
1.1
34.7
121.2
284.7
62.6
49.7
3.6
521.8
The carrying amounts of trade and other payables and other non-current liabilities are denominated in the following currencies:
Euro
Sterling
2023
€m
496.6
59.9
556.5
2022
€m
–
29.7
4.8
1.7
36.2
117.3
300.8
61.3
48.4
0.6
528.4
2022
€m
499.0
65.6
564.6
The €17.6m (2022: €nil) non-current accrual and other payables relates to off-take of certain soil related products which are expected to take up
to 18 months to clear. The non-current other tax and social security payables relate to the Dutch government tax deferrals in relation to
Covid-19 which are repayable in 36 instalments from October 2021.
At 31 March 2023 the balance of interest accrued relating to total borrowings was €5.9m (2022: €7.9m) and was included within the accruals
and other payables balance. This balance was after finance charges of €29.1m (2022: €29.3m) (including the finance charges impact of the
interest rate swaps) net of a cash outflow of €31.3m (2022: €28.4m) (excluding €0.4m (2022: €1.6m) of loan fees) and €0.2m (2022: €nil) relating
to exchange rate changes.
Deferred revenue primarily relates to waste received or collected which has not yet been processed in accordance with the performance
obligations of the contracts with customers. At each month end the amount of unprocessed waste is determined and there is an adjustment to
revenue with a corresponding credit to deferred revenue. Additionally, in the UK Municipal business line within Specialities deferred revenue
relates to the service element of the PPP contracts known as lifecycle as explained in note 3.1. Of the deferred revenue recognised at 31 March
2022 of €53.2m (2021: €54.3m), €47.3m (2022: €50.7m) has been recognised in revenue during the year ended 31 March 2023 and €4.9m (2022:
€nil) was sold as part of a disposal of business assets during the year.
The decrease in payables in the Statement of Cash Flows of €9.5m differs to the balance sheet movement of €8.1m by €1.4m as a result
of capital creditors, foreign exchange, interest accruals and acquisitions and disposals.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
209
SECTION 4. Operating assets and liabilities CONTINUED
4.10 PROVISIONS
Accounting policy
Provisions are recognised where there is a present legal or constructive obligation as a result of a past event and it is probable that an outflow
of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the
obligation. The value of a provision is the present value of the expenditures expected to be required to settle the obligation and where the
effect of the time value of money is material a discount is applied and is unwound over the life of the provision. The unwinding of the discount
to present value is included within finance costs.
The Group’s policies on provisions for specific areas are:
• Site restoration and aftercare provisions are recognised at the net present value (NPV) of the estimated future expenditure required to settle
the Group’s restoration and aftercare obligations at its landfill and mineral extraction sites. Provision is made for the Group’s unavoidable
costs in relation to restoration liabilities. Provision is made for the NPV of post closure costs (aftercare) as the aftercare liability arises. Costs
are charged to the Income Statement based on the quantity of waste deposited in the year or recognised as a landfill site asset within
property, plant and equipment and depreciated over the operational period of the site.
• Aftercare provisions relate to landfill sites in the Netherlands, Belgium and the UK. The aftercare obligations in relation to the Netherlands
landfill sites are transferred to the Province in line with the legal framework which requires the Group to prepare aftercare plans which must
be approved by the Province. The Group is required to provide the funds to the Province which are then administered and controlled by the
Province per landfill location. The Group recognises an aftercare provision to the extent that additional contributions are required. For the
landfill sites in Belgium and the UK the aftercare obligation remains with the Group.
• Onerous contract provisions are recognised at the NPV of the future cash flows when the unavoidable costs of meeting the obligation under
the contract exceed the economic benefits expected to be received.
• Legal and warranty provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation and the amount can be reliably measured. The value of the
provision is management’s best estimate of the expenditure required to settle the present obligation based on the most likely outcome.
• Provisions for restructuring costs are recognised when a detailed formal plan exists and those affected by that plan have a valid expectation
that the restructuring will be carried out.
• Long-service employee awards included within Other provisions are recognised as long-term employee benefits in relation to employees in
the Netherlands and Belgium in accordance with IAS 19 Employee Benefits. The valuation method is similar to defined benefit pension
schemes although the cost is recognised immediately in the Income Statement. These plans are unfunded.
• The split of timings of outflows is not certain and has been estimated based on management’s latest expectation.
Judgements and estimates
The discount rates are reviewed at each year end with consideration given to relevant market rates. Determining appropriate discount rates to
apply to provisions is complex and a source of significant estimation uncertainty. The key input is risk free rates and movement in these rates
had been relatively low in previous years. As a result of the significant volatility in both inflation and risk free rates over the last year, together
with guidance issued by the regulator, the Financial Reporting Council’s May 2022 thematic review on discount rates, the Group has
undertaken an in depth review in determining the discount rates to be applied at 31 March 2023.
The landfill provisions are principally located in the Netherlands and Belgium. The discount rate is calculated with reference to German
Government bond yields as an appropriate Eurozone country primarily due to their higher degree of liquidity compared to Dutch and Belgian
Government bonds. The onerous contract provisions are principally in the UK and the discount rate is calculated with reference to UK
Government bond yields. In determining the discount rate, consideration is also given to the timing of future cash flows. The cash flows used
to determine the outstanding provision are risk adjusted and include annual inflation so there is no risk adjustment included within the
nominal discount rate. In all cases, the final determination of rates used has taken into consideration average bond yields over the last 10 and
20 years and the market bond yields at 31 March 2023. The rates used are not materially different to the market data bond yields at 31 March
2023, differing by between 0.01% and 0.13%.
The table below sets out the range of nominal discount rates used for the significant provisions:
Type of provision
Landfill provisions in the Netherlands and Belgium
Landfill provisions in the UK
Onerous contract provisions in the UK
2023
%
2.20 to 2.30
3.40
3.25 to 3.75
2022
%
2.50
3.00
3.00
Strategic reportGovernance reportFinancial statementsOther information 210
SECTION 4. Operating assets and liabilities CONTINUED
4.10 PROVISIONS CONTINUED
Provisions are analysed as follows:
At 1 April 2021 – restated*
Provided in the year
Released in the year
Finance charges – unwinding of discount (note 5.4)
Utilised in the year
Exchange rate changes
At 31 March 2022 – restated*
Impact of adopting amendments to IAS 37 (section 1)
At 1 April 2022
Acquisition through business combinations
Provided in the year
Released in the year
Disposed of in the year
Finance charges – unwinding of discount (note 5.4)
Utilised in the year
Exceptional impact of change in discount rates and
reassessment of UK Municipal contracts (note 3.3)
Exchange rate changes
At 31 March 2023
Within one year
Between one and five years
Between five and ten years
Over ten years
At 31 March 2023
Within one year – restated*
Between one and five years – restated*
Between five and ten years
Over ten years
At 31 March 2022 – restated*
Restated*
Onerous
contracts
€m
Legal and
warranty
€m
Restructuring
€m
Other
€m
Restated*
Total
€m
Site
restoration
and
aftercare
€m
157.6
1.4
(2.6)
3.9
(3.4)
–
156.9
–
156.9
–
4.9
–
–
4.1
(5.5)
4.3
(0.2)
87.3
6.2
(4.8)
2.3
(6.0)
0.7
85.7
53.2
138.9
–
0.2
–
–
4.0
(17.3)
21.3
(5.2)
164.5
141.9
11.3
40.6
61.9
50.7
18.9
62.3
32.8
27.9
164.5
141.9
5.7
49.3
50.8
51.1
156.9
10.2
28.2
23.1
24.2
85.7
25.7
0.4
(1.3)
0.1
(1.8)
–
23.1
–
23.1
–
0.4
(15.1)
–
–
(0.9)
–
–
7.5
4.0
0.4
0.5
2.6
7.5
4.7
15.6
0.5
2.3
23.1
3.8
4.8
(0.7)
–
(3.9)
–
4.0
–
4.0
–
2.6
(1.5)
–
–
(2.1)
–
–
3.0
3.0
–
–
–
3.0
4.0
–
–
–
4.0
23.3
4.7
(1.8)
0.1
(1.0)
–
25.3
–
25.3
1.3
5.0
(3.3)
(1.8)
0.2
(1.5)
(0.2)
–
25.0
6.5
6.0
3.3
9.2
25.0
7.5
5.4
3.4
9.0
25.3
297.7
17.5
(11.2)
6.4
(16.1)
0.7
295.0
53.2
348.2
1.3
13.1
(19.9)
(1.8)
8.3
(27.3)
25.4
(5.4)
341.9
43.7
109.3
98.5
90.4
341.9
32.1
98.5
77.8
86.6
295.0
*The comparatives have been restated due to a prior period adjustment as explained in section 1 Basis of preparation.
Site restoration and aftercare
The Group’s unavoidable costs have been reassessed at the year end and the NPV fully provided for. The site restoration provisions at 31 March
2023 relate to the cost of final capping and covering of the landfill and mineral extraction sites. These site restoration costs are expected to be
paid over a period of up to 28 years (2022: 30 years) from the balance sheet date. Aftercare provisions cover post-closure costs of landfill sites
which include such items as monitoring, gas and leachate management and licensing. For aftercare provisions relating to Dutch landfill sites
where the province administers and controls the aftercare fund, payments are made to the province at predetermined dates over a period of
up to 10 years. Where the Group is responsible for the aftercare the dates of payments of these aftercare costs are uncertain but are anticipated
to be over a period of at least 30 years from closure of the relevant landfill site. All site restoration and aftercare costs have been estimated by
management based on current best practice and technology available and may be impacted by a number of factors including changes in
legislation and technology.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 211
SECTION 4. Operating assets and liabilities CONTINUED
4.10 PROVISIONS CONTINUED
Onerous contracts
Onerous contract provisions arise when the unavoidable costs of meeting contractual obligations exceed the cash flows expected. They are
provided for at the lower of the NPV of either exiting the contracts or fulfilling our obligations under the contracts. As a result of the
amendment to IAS 37 for Onerous contracts, at 1 April 2022 provisions for onerous contracts have increased by €53.2m as the amendment now
requires the costs of fulfilling a contract consist of both the incremental cost of fulfilling that contract and an allocation of other costs that
related directly to fulfilling the contract. Prior to this amendment the Group only included incremental direct costs with an allocation of other
divisional costs now included. The provisions have been calculated on the best estimate of likely future cash flows over the contract term
based on the latest projections, including assumptions on inflationary increases, tonnage inputs, off-take availability and recyclates pricing.
The provisions are to be utilised over the period of the contracts to which they relate with the latest date being 2040.
Legal and warranty
Legal and warranty provisions relate to legal claims, warranties and indemnities. Under the terms of the agreements for the disposal of certain
businesses, the Group has given a number of warranties and indemnities to the purchasers which may give rise to payments. The Group has a
liability until the end of the contractual terms in the agreements. The Group considers each warranty provision based on the nature of the business
disposed of and the type of warranties provided with judgement used to determine the most likely obligation.
On 6 February 2020 the European Commission announced its decision to initiate a formal investigation in which it alleges that the Walloon
Region of Belgium provided state aid to the Group in relation to the Cetem landfill. An adverse judgement would have required the Walloon
Region to seek repayment from the Group and a provision of €15.1m was recognised. On 3 March 2023 the European Commission concluded
its formal investigation and determined that the Belgian Walloon Region did not provide State Aid to the Group. As a result the provision has
been released during the year ended 31 March 2023 and there is no longer a contingent liability.
Restructuring
The restructuring provision primarily relates to redundancy and related costs incurred as a result of restructuring initiatives. The provision is
expected to be spent in the following twelve months as affected employees leave the business.
Other
Other provisions includes dilapidations €10.9m (2022: €9.1m), long-service employee awards €6.0m (2022: €7.0m) and other environmental
liabilities €8.1m (2022: €9.2m). The dilapidations provisions are determined on a site by site basis using internal expertise and experience and
are calculated as the most likely cash outflow at the end of the contracted obligation. The provisions will be utilised over the period up to
2072.
Sensitivities
Landfill provisions in the Netherlands and Belgium
A 0.5% change in the nominal discount rates would result in a €9m (2022: €6m) change in the provision.
In assessing the future cash flows, assumptions on inflation have been taken into account. The costs for the year from 1 April 2023 have been
inflated to reflect current market pricing depending on the nature of the cost, external inflation forecasts and taking into account actual
inflation experienced to date and any legal and contractual circumstances. For all subsequent periods a 2% inflation rate has been assumed in
line with the ECB’s monetary policy target. Further changes for costs of key items such as capping materials and water treatment may arise but
they are difficult to estimate. For illustration, the impact of a further 5% increase in these key costs would lead to an increase in provisions of
€5m.
Onerous contract provisions in UK Municipal
A 0.5% change in the nominal discount rates would result in a €4m (2022: €3m) change in the provision.
The onerous contract provisions are mostly linked to RPI and RPIx therefore an increase in costs should be matched by an increase in revenue,
although the timing of the increases varies by contract. The inflation rates used in the models from 1 April 2023 is 11.1% and 12.6% RPIx based
on actual rates at dates determined by the respective contracts and 9% CPI based on external inflation forecasts, from 1 April 2024 5.1% and
4.08% RPIx and 4% CPI based on external inflation forecasts and for later years 2.9% and 2.32% RPIx and 2% CPI in line with UK Government
target inflation. We have considered the impact of a further 1% change to inflation from 1 April 2024 and this would lead to an increase in
provisions of €1m.
The provisions are sensitive to the impact of future recyclate prices. We have based our assumptions for recyclate prices on our best estimate
of future prices after taking into account observed prices over recent months and average prices over five years. Recyclate prices have reached
record highs in the last year before normalising at levels close to the five-year averages. Prices are assumed to remain close to these
normalised levels but future volatility is possible. The impact of a 20% change in paper prices and a 10% change in metal and plastics prices
would lead to an increase or reduction in the onerous contract provisions of around €4m (2022: €5m).
Strategic reportGovernance reportFinancial statementsOther information 212
SECTION 5. Capital structure and financing
This section outlines how the Group manages its capital structure and related financing costs. It includes cash, borrowings, derivatives
and the equity of the Group. The instruments in place enable the Group to maintain the required capital structure in order to finance the
activities both now and in the future.
Total net debt reflects the Group’s cash and cash equivalents and borrowings including IFRS 16 lease liabilities and PPP cash and non-
recourse debt. Net debt for covenant reporting includes cash and cash equivalents and finance leases previously reported under IAS 17 but
excludes additional lease liabilities reported under IFRS 16 and both cash and the non-recourse debt relating to the UK PPP contracts.
5.1 MOVEMENT IN TOTAL NET DEBT
2023
Bank loans and overdrafts – floating interest rates
Bank loans and private placements – fixed interest rates
Retail bonds
Lease liabilities
Debt excluding PPP non-recourse debt
PPP non-recourse debt
Total gross debt
Cash and cash equivalents – core
Cash and cash equivalents – restricted relating to PPP contracts
Total net debt
Analysis of total net debt:
Net debt excluding PPP non-recourse net debt
PPP non-recourse net debt
Total net debt
Restated*
At
1 April 2022
€m
Cash flows
€m
Acquired
(Note 6.1)
€m
Other
non-cash
changes
€m
Exchange
movements
€m
At
31 March 2023
€m
(14.1)
(24.8)
(299.2)
(219.8)
(557.9)
(100.2)
(658.1)
42.5
21.1
(594.5)
(515.4)
(79.1)
(594.5)
(79.4)
(80.0)
100.0
47.5
(11.9)
8.1
(3.8)
1.5
(1.1)
(3.4)
(10.4)
7.0
(3.4)
(7.0)
–
–
(30.7)
(37.7)
–
(37.7)
–
–
(0.6)
0.2
(0.3)
(52.0)
(52.7)
–
(52.7)
–
–
(37.7)
(52.7)
(37.7)
–
(37.7)
(52.7)
–
(52.7)
(0.1)
–
–
0.2
0.1
3.8
3.9
(0.3)
(1.0)
2.6
(0.2)
2.8
2.6
(101.2)
(104.6)
(199.5)
(254.8)
(660.1)
(88.3)
(748.4)
43.7
19.0
(685.7)
(616.4)
(69.3)
(685.7)
*The comparatives for lease liabilities have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
2022
Bank loans and overdrafts – floating interest rates
Bank loans and private placements – fixed interest rates
Retail bonds
Lease liabilities
Debt excluding PPP non-recourse debt
PPP non-recourse debt
Total gross debt
Cash and cash equivalents – core
Cash and cash equivalents – restricted relating to PPP contracts
Total net debt
Analysis of total net debt:
Net debt excluding PPP non-recourse net debt
PPP non-recourse net debt
Total net debt
Restated*
At
1 April 2021
€m
Restated*
Cash flows
€m
Other
non-cash
changes
€m
Restated*
Exchange
movements
€m
Restated*
At
31 March 2022
€m
(184.8)
(24.7)
(174.5)
(237.7)
(621.7)
(105.1)
(726.8)
51.5
17.3
(658.0)
(570.2)
(87.8)
(658.0)
170.6
–
(125.0)
43.5
89.1
5.7
94.8
(9.8)
3.6
88.6
79.3
9.3
88.6
(0.5)
(0.1)
0.3
(25.6)
(25.9)
–
(25.9)
–
–
(25.9)
(25.9)
–
(25.9)
0.6
–
–
–
0.6
(0.8)
(0.2)
0.8
0.2
0.8
1.4
(0.6)
0.8
(14.1)
(24.8)
(299.2)
(219.8)
(557.9)
(100.2)
(658.1)
42.5
21.1
(594.5)
(515.4)
(79.1)
(594.5)
*The comparatives for lease liabilities have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 SECTION 5. Capital structure and financing CONTINUED
5.1 MOVEMENT IN TOTAL NET DEBT CONTINUED
Net increase (decrease) in cash and cash equivalents
Net (increase) decrease in borrowings and lease liabilities
Cash flows in total net debt
Bank loans and lease liabilities acquired through a business combination
Lease liabilities entered into during the year
Lease liabilities cancelled during the year
Capitalisation of loan fees
Amortisation of loan fees
Exchange gain
Movement in total net debt
Total net debt at beginning of year
Total net debt at end of year
213
2023
€m
0.4
(3.8)
(3.4)
(37.7)
(57.4)
5.4
0.3
(1.0)
2.6
(91.2)
(594.5)
(685.7)
Restated*
2022
€m
(6.2)
94.8
88.6
–
(27.1)
1.5
1.6
(1.9)
0.8
63.5
(658.0)
(594.5)
*The comparatives for lease liabilities and exchange gain have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
5.2 CASH AND CASH EQUIVALENTS
Accounting policy
Cash and cash equivalents include core cash balances and restricted cash at bank balances relating to PPP contracts and are held at
amortised cost. The cash held in the PPP Special Purpose Vehicles (SPVs) is not freely available to the Group as the funds are restricted in
accordance with the contracts entered into between the SPVs and the banks and cash can only be released to the Group when approved by
the lenders. Also included in cash and cash equivalents is €4.0m (2022: €2.3m) held by non-subsidiaries which is only available to the Group in
consultation with all other partners.
Cash and cash equivalents are analysed as follows:
Cash at bank and in hand – core
Cash at bank – restricted relating to PPP contracts
Total cash and cash equivalents
The carrying amounts of cash and cash equivalents are denominated in the following currencies:
Euro
Sterling
2023
€m
43.7
19.0
62.7
2023
€m
22.2
40.5
62.7
2022
€m
42.5
21.1
63.6
2022
€m
29.8
33.8
63.6
Strategic reportGovernance reportFinancial statementsOther information
214
SECTION 5. Capital structure and financing CONTINUED
5.3 BORROWINGS
Accounting policy
Retail bonds and bank borrowings
Retails bonds and interest bearing loans are recorded at their initial fair value which normally reflects the proceeds received, net of direct issue
costs and subsequently at amortised cost. When the Group exchanges one debt instrument for another one with an existing lender and with
substantially different terms, such exchange is accounted for as an extinguishment of the original financial liability and the recognition of a
new financial liability. Similarly, the Group accounts for substantial modifications of the terms of an existing liability or part of it as an
extinguishment of the original financial liability and the recognition of a new liability. The terms are considered to be substantially different if
the discounted present value of the cash flows under the new terms calculated using the original effective rate, is at least 10% different from
the discounted present value of the remaining cash flows of the original financial liability. Any gain or loss on extinguishment is recognised in
the Income Statement.
Lease liabilities
Lease liabilities are recognised as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for
use by the Group. The Group leases various real estate properties and items of plant, machinery and trucks for normal business operations
across the divisions. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.
For new contracts entered into the Group considers whether a contract is or contains a lease. A lease is defined as ‘a contract that conveys the
right to use an asset for a period of time in exchange for consideration’. To apply this definition the Group assesses whether the contract meets
three key evaluations which are:
• The contract contains an identified asset, which is either explicitly identified in the contract or implicitly specified by being identified at the
time the asset is made available to the Group;
• The Group has the right to obtain substantially all of the economic benefits from use of the identified asset throughout the period of use,
considering its rights within the defined scope of the contract; and
• The Group has the right to direct the use of the identified asset throughout the period of use. The Group assesses whether it has the right to
direct ‘how and for what purpose’ the asset is used throughout the period of use.
The lease liability is initially measured at the present value of the contractual payments due to the lessor over the lease term, discounted using
the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate. The incremental
borrowing rate is determined based on interest rates from various external financing sources and adjusted to reflect the terms of the lease and
type of leased asset. It is reassessed on a regular basis. The exercise price of any purchase options are only included in the carrying value if the
Group can assess with reasonable certainty that the option would be exercised.
The lease liability is subsequently measured at amortised cost and remeasured when there is a change in future lease payments arising from a
change in an index or rate or if the Group changes its assessment of whether it will exercise a purchase, extension or termination option. When
the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset.
Lease payments are allocated between principal and finance cost. The finance cost is charged to the Income Statement over the lease period
to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
The Group has applied the exemption not to recognise a right-of-use asset and a lease liability where the leased assets are of a low value
determined as being below €5,000 when new or when the lease duration is for 12 months of less. For these items the annual expense of lease
payments is disclosed in note 3.2.
Estimates and assumptions
• Extension and termination options are included in a number of real estate and plant and machinery leases across the Group. In determining the
lease term, management has considered all facts and circumstances that create an economic incentive to exercise such options. Extension
options are only included in the lease term if the lease is reasonably certain to be extended or not terminated.
• The Group estimates the incremental borrowing rate by taking into account the type of right-of-use asset, the lease term and the country
of operation.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 SECTION 5. Capital structure and financing CONTINUED
5.3 BORROWINGS CONTINUED
Borrowings are analysed as follows:
Non-current borrowings
Retail bonds
Bank loans and private placements – fixed interest rates
Bank loans – floating interest rates#
Lease liabilities
PPP non-recourse debt
Current borrowings
Retail bonds
Bank loans and private placements – fixed interest rates
Bank loans and overdrafts – floating interest rates
Lease liabilities
PPP non-recourse debt
215
Restated*
2022
€m
199.2
24.8
12.8
178.5
94.6
509.9
100.0
–
1.3
41.3
5.6
148.2
2023
€m
199.5
89.6
101.1
208.3
83.1
681.6
–
15.0
0.1
46.5
5.2
66.8
#The revolving credit facility is now included in Bank loans – floating interest rates.
*The comparatives for lease liabilities have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
European private placements, revolving credit facility, retail bond and bank loan borrowings include capitalised loan fees of €2.3m (2022:
€3.2m).
The carrying amounts of borrowings are denominated in the following currencies:
Euro
Sterling
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
The table below details the maturity profile of non-current borrowings:
2023
€m
653.0
95.4
748.4
Restated*
2022
€m
552.0
106.1
658.1
Between one and two years
Between two years and five years
Over five years
2023
2022
Debt
excluding PPP
non-recourse
debt
€m
PPP non-
recourse debt
€m
215.1
211.6
171.8
598.5
5.7
18.8
58.6
83.1
Restated*
Debt
excluding PPP
non-recourse
debt
€m
PPP non-
recourse debt
€m
51.9
152.2
211.2
415.3
5.5
18.7
70.4
94.6
Total
debt
€m
220.8
230.4
230.4
681.6
Restated*
Total
debt
€m
57.4
170.9
281.6
509.9
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
Strategic reportGovernance reportFinancial statementsOther information
216
SECTION 5. Capital structure and financing CONTINUED
5.3 BORROWINGS CONTINUED
Retail bonds
At 31 March 2023, the Group had two issues of green retail bonds. The green retail bonds of €75m (2022: €75m) maturing in July 2024 have an
annual gross coupon of 3.00% and the green retail bonds of €125m (2022: €125m) maturing in July 2027 have an annual gross coupon of
3.00%. On 16 June 2022 the €100m green retails bonds with an annual gross coupon of 3.65% were repaid on maturity. The green retail bonds
are unsecured and have cross guarantees from members of the Group. Further details are given in note 5.8.
Bank loans - fixed interest rates and floating interest rates
At 31 March 2023, the Group had a Euro denominated multicurrency green finance facility of €470m (2022: €425m) including a €400m (2022:
€400.0m) revolving credit facility (RCF) and €70m (2022: €25.0m) European private placements (EUPP).
Of the RCF €30m matures on 18 May 2023, €65m matures on 18 May 2024 and €305m matures on 18 May 2025. At 31 March 2023 €102.5m (2022:
€15.0m) of the RCF was drawn for borrowings in Euros with floating interest rates . The remaining €297.5m (2022: €385.0m) was available for
drawing of which €48.5m (2022: €48.5m) was allocated for ancillary overdraft and guarantee facilities. The RCF qualifies as green financing as
per the Green Finance Framework and is aligned to the International Capital Market Association Green Bond Principles and the Loan Market
Association Green Loan Principles. There are four green KPIs which result in an interest rate margin adjustment dependent upon performance
against pre-determined targets that were agreed with the Lenders. The green KPIs are non-financial and specific to the performance of the Group
in the following areas: recycling and recovery rate, carbon avoidance, percentage of trucks Euro VI compliant and >3 day accident rate. The
impact of the margin adjustment is insignificant and therefore the IFRS 9 Financial instruments solely principal payments and interest criteria are
met and it is appropriate to account for the RCF on an amortised cost basis.
The EUPP has a maturity of December 2023 for €15m at a fixed interest rate of 2.344%, December 2025 for €10m with a fixed interest rate of
2.916% and November 2029 for the additional €45m drawn in November 2022 at a fixed interest rate of 4.676%.
In November 2022 the Group drew down a new €10m loan repayable in one lump sum on 10 November 2027 at a fixed interest rate of 4.22%.
On 17 November 2022 the Group signed a finance contract with the European Investment Bank for a facility of €40m, the first tranche of €25m
was drawn on 15 December 2022 at a fixed interest rate of 3.572% repayable in seven equal annual instalments commencing on 15 December
2025.
All bank loans are unsecured and have cross guarantees from members of the Group. Further details are given in note 5.8.
Lease liabilities
The Group’s lease liabilities are payable as follows:
Within one year
Between one and five years
More than five years
2023
2022 – restated*
Minimum
lease
payments
€m
54.5
118.9
198.2
371.6
Interest
€m
Principal
€m
(8.0)
(23.4)
(85.4)
(116.8)
46.5
95.5
112.8
254.8
Minimum
lease
payments
€m
47.1
109.6
155.0
311.7
Interest
€m
Principal
€m
(5.8)
(17.7)
(68.4)
(91.9)
41.3
91.9
86.6
219.8
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
For most plant and machinery leases the Group has an option to purchase the leased assets at the end of the lease term. There are no
restrictions imposed by lessors to take out further debt or leases.
PPP non-recourse debt
The PPP non-recourse debt is held in three PPP companies: Argyll & Bute, Cumbria and Barnsley, Doncaster & Rotherham with maturities on
15 July 2023, 30 September 2032 and 30 June 2037 respectively. Each UK Municipal PPP company has non-recourse loan facilities which are
secured by a legal mortgage over any land and a fixed and floating charge over the assets of the PPP company and the carrying amount of
financial assets pledged excluding cash was €128.8m (2022: €135.6m).
In the majority of cases subsidiaries holding non-recourse PPP debt and financial assets are restricted in their ability to transfer funds to the
parent in the form of cash dividends or to repay loans and advances. This is due to the terms of the financing facility agreements and lender
approval is required to make such transfers.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 217
SECTION 5. Capital structure and financing CONTINUED
5.3 BORROWINGS CONTINUED
Liquidity risk
Liquidity risk is the risk that the Group does not have sufficient financial resources to meet its obligations as they fall due. The Group primarily
manages liquidity risk by monitoring forecast cash flows to ensure that revolving credit facility drawdowns are arranged as necessary and an
adequate level of headroom is maintained. As explained in note 4.8 the Group has an invoice finance facility. The Group does not have any
supplier finance arrangements. The way the Group manages liquidity risk has not changed from the previous year. Furthermore, the Group
utilises its cash resources to manage its short-term liquidity.
The Group has unutilised committed borrowing facilities expiring within one year of €30.0m (2022: €nil), between one and two years of €80.0m
(2022: €30.0m) and expiring more than 2 years of €169.0m (2022: €321.5m) in relation to the Euro denominated multicurrency green finance
and European Investment bank facilities. The unutilised committed PPP non-recourse debt borrowing facilities of €2.2m (2022: €2.2m) expire
in more than 2 years. In addition, the Group has access to €12.5m (2022: €12.5m) of undrawn uncommitted working capital facilities.
The following table analyses the Group’s financial liabilities including derivative financial instruments into relevant maturity groupings. The
maturities of the undiscounted cash flows, including interest and principal, at the balance sheet date are based on the earliest date on which
the Group is obliged to pay and as a result will not always reconcile with the amounts disclosed in the Balance Sheet.
At 31 March 2023
Retail bonds
Bank loans – Revolving credit facility, private placements and other bank loans
Bank loans – PPP non-recourse debt
Lease liabilities
PPP Interest rate swaps
Fuel derivatives
Trade and other payables
Financial liabilities and derivative financial liabilities
PPP Interest rate swaps
Fuel derivatives
Financial liabilities and total derivatives
At 31 March 2022
Retail bonds
Bank loans – Revolving credit facility, private placements and other bank loans
Bank loans – PPP non-recourse debt
Lease liabilities - restated*
PPP Interest rate swaps
Fuel derivatives
Trade and other payables
Financial liabilities and derivative financial liabilities - restated*
Fuel derivatives
Financial liabilities and total derivatives - restated*
Within
one year
€m
Between one
and five years
€m
Over
five years
€m
Total
contractual
cash flows
€m
6.0
23.6
11.7
54.5
0.1
1.9
417.1
514.9
(0.7)
(0.4)
513.8
109.6
2.2
9.7
47.1
2.3
0.1
411.0
582.0
(6.6)
575.4
217.3
197.0
44.0
118.9
1.6
0.2
–
579.0
(0.7)
–
578.3
94.5
41.5
38.3
109.6
6.4
–
–
290.3
(0.4)
289.9
–
63.9
72.3
198.2
1.1
–
–
335.5
0.1
–
223.3
284.5
128.0
371.6
2.8
2.1
417.1
1,429.4
(1.3)
(0.4)
335.6
1,427.7
128.7
–
82.5
155.0
7.3
–
–
373.5
–
373.5
332.8
43.7
130.5
311.7
16.0
0.1
411.0
1,245.8
(7.0)
1,238.8
*The comparatives relating to lease liabilities have been restated due to a prior year adjustment as explained in section 1 Basis of preparation
Strategic reportGovernance reportFinancial statementsOther information
218
SECTION 5. Capital structure and financing CONTINUED
5.4 NET FINANCE CHARGES
Accounting policy
Finance charges, including direct issue costs, are accounted for on an accruals basis in the Income Statement using the effective interest rate
method. Also included is the charge for discount unwind of long-term provisions with further details provided in note 4.10. Interest receivable
on financial assets relating to PPP contracts is added to the financial asset based on the rate implied at the start of the PPP project.
In certain circumstances, finance charges may be classified as non-trading or exceptional due to their size or incidence to enable a better
understanding of the underlying net finance costs. These non-trading or exceptional income or charges include:
• The change in fair value where a derivative financial instrument does not qualify for hedge accounting.
• Ineffectiveness incurred by a derivative financial instrument that does qualify for hedge accounting.
• The gain or loss where a derivative financial instrument is terminated.
Net finance charges are analysed as follows:
Finance charges
Interest on borrowings*
Interest payable on PPP non-recourse debt
Lease liabilities interest
Unwinding of discount on provisions (note 4.10)
Interest charge on retirement benefit schemes (note 7.2)
Other finance costs
Total finance charges before non-trading and exceptional items
Non-trading and exceptional finance charges:
Charge as a result of the termination of cash flow hedges (note 3.3)
Total non-trading and exceptional finance charges
Total finance charges
Finance income
Interest receivable on financial assets relating to PPP contracts (note 4.5)
Unwinding of discount on deferred consideration receivable
Interest income on retirement benefit schemes (note 7.2)
Other finance income
Total finance income before non-trading and exceptional items
Non-trading and exceptional finance income:
Ineffectiveness income on cash flow hedges (note 3.3)
Total non-trading and exceptional finance income
Total finance income
Net finance charges
*Interest on borrowings has been amended to include amortisation of loan fees which was previously shown separately.
2023
€m
14.0
6.9
7.8
8.3
–
2.0
39.0
–
–
39.0
(8.6)
–
(0.2)
(1.0)
(9.8)
(0.9)
(0.9)
(10.7)
2022
€m
15.4
7.4
7.2
6.4
0.1
1.7
38.2
0.1
0.1
38.3
(9.0)
(0.1)
–
(0.2)
(9.3)
(0.2)
(0.2)
(9.5)
28.3
28.8
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
219
SECTION 5. Capital structure and financing CONTINUED
5.5 DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
Accounting policy
All derivatives are initially recognised at fair value and subsequently measured at fair value at each reporting date. The fair value of a derivative
financial instrument is classified as a non-current asset or liability when the remaining maturity of the hedged item is more than one year and
as a current asset or liability when the remaining maturity is less than one year.
In accordance with its treasury policy, the Group only holds derivative financial instruments to manage the Group’s exposure to financial risk.
The Group does not hold derivative financial instruments for trading or speculative purposes.
The exposure to financial risk includes interest risk and foreign exchange risk on the Group’s variable rate borrowings and commodity risk in
relation to diesel consumption. The Group manages these risks through a range of derivative financial instruments, including interest rate
swaps and fuel derivatives.
Hedge accounting
Derivative financial instruments are considered to be used for hedging purposes when they alter the risk profile of an underlying exposure of
the Group in line with the Group’s risk management policies. At the inception of the hedge relationship, the Group formally designates and
documents the relationship between the hedging instrument and hedged item, along with its risk management objectives and its strategy for
undertaking various hedge transactions. Hedge accounting allows the matching of gains and losses on hedged items and associated hedging
instruments in the same accounting period to minimise volatility in the Income Statement. In order to qualify for hedge accounting,
prospective hedge effectiveness must meet all the following criteria:
• An economic relationship exists between the hedged item and the hedging instrument.
• The effect of credit risk does not dominate the value changes resulting from the economic relationship.
• The hedge ratio is the same as that resulting from actual amounts of hedged items and hedging instruments for risk management.
The hedge ratio for each designation is established by comparing the quantity of the hedging instrument and the quantity of the hedged item
to determine their relative weighting. For all the Group’s existing hedge relationships the hedge ratio has been determined at 1:1. Where there is
a cumulative loss or gain on the hedging instrument and it is no longer expected that the loss or gain will be recovered it is immediately
recognised in the Income Statement.
Derivatives designated as hedging instruments are classified on inception as cash flow hedges or net investment hedges. Changes in the fair
value of derivative financial instruments that are designated and qualify as cash flow hedges are recognised in Other Comprehensive Income
and subsequently reclassified into profit or loss as the hedged cash flows occur. Net investment hedges are accounted for in a similar way to
cash flow hedges.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, exercised or no longer qualifies for hedge
accounting. At that time, any cumulative gain or loss on the hedging instrument recognised in equity is retained in equity until the forecast
transaction occurs at which point it is recognised in the Income Statement. If a hedged transaction is no longer expected to occur, the net
cumulative gain or loss recognised in equity is recognised in the Income Statement immediately as a non-trading finance income or finance
charge.
Ineffectiveness
Sources of hedge ineffectiveness in the Group may arise when there is a change in circumstances that affect the terms of the hedged item such
that the critical terms no longer match exactly the critical terms of the hedging instrument such as if there is a change in the credit risk of both
counterparties, if there is a change in the underlying debt profile of a variable rate loan in relation to interest rate swaps or a reduced
requirement for diesel volumes in relation to the fuel derivatives. Any ineffectiveness is recognised in the Income Statement as a non-trading
finance income or finance charge.
Strategic reportGovernance reportFinancial statementsOther information 220
SECTION 5. Capital structure and financing CONTINUED
5.5 DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES CONTINUED
On 5 March 2021, the UK’s Financial Conduct Authority (FCA) formally announced the cessation of all GBP London Interbank Offered Rate
(LIBOR) benchmark settings published by ICE Benchmark Administration (IBA) after 31 December 2021. During the current year, work has been
completed with the providers of the PPP non-recourse borrowings and interest rate swaps to amend the benchmark rate referenced in the
loan agreements and derivative hedging instruments from GBP LIBOR to GBP SONIA (Sterling Overnight Index Average) including a credit
adjustment spread on the debt to compensate for the basis differential between the two benchmarks. This did not result in any accounting
changes.
Derivative financial instruments are analysed as follows:
Fuel derivatives – cash flow hedges
Interest rate swaps relating to PPP contracts – cash flow hedges
Total
Current
Non-current
Total
2023
2022
Assets
€m
Liabilities
€m
Assets
€m
Liabilities
€m
0.4
1.2
1.6
0.4
1.2
1.6
2.1
2.4
4.5
1.9
2.6
4.5
7.0
–
7.0
6.6
0.4
7.0
0.1
14.6
14.7
0.1
14.6
14.7
Fuel derivatives
The notional value of wholesale fuel covered by fuel derivatives at 31 March 2023 amounted to €17.7m (2022: €14.7m). The Group has annual
usage across the Netherlands and Belgium of approximately 37m litres of diesel per annum of which approximately 24m litres have been fixed
at an average of €0.63 per litre for the year to 31 March 2024 (notional value €15.0m) and a further 5m litres has been fixed at an average of
€0.58 per litre for the year to 31 March 2025 (notional value €2.7m).
Interest rate swaps relating to PPP contracts
The notional principal amount of the outstanding interest rate swap contracts at 31 March 2023 was €91.6m (2022: €100.9m). Under these
contracts the interest rates on PPP non-recourse borrowings for Cumbria and Barnsley, Doncaster & Rotherham projects are fixed at rates of
4.8% and 3.4% respectively from inception to expiry on 30 September 2032 and 30 June 2037 respectively. The gains and losses recognised in
the Statement of Comprehensive Income for cash flow hedges will be released to the Income Statement within finance costs until the
repayment of the non-recourse borrowings. A revised repayment programme for the Cumbria PPP project borrowing has led to ineffectiveness
of a credit of €0.9m (2022: €0.2m) being recognised for the related interest rate swap which has been taken to the Income Statement as a
non-trading and exceptional finance credit.
During the year ended 31 March 2023 the liability of the interest rate swaps relating to PPP contracts reduced by €13.4m (2022: €10.7m),
included in this movement was an interest charge of €1.7m (2022: €4.1m) which was wholly paid in cash during the year (presented in both the
Income Statement and Statement of Cash Flows within finance charges), a fair value gain of €13.2m (2022: €10.9m) of which €12.3m (2022:
€10.7m) gain was taken to Other Comprehensive Income with the remainder to the Income Statement and the impact of foreign exchange was
€0.2m gain (2022: €0.2m) loss.
The following table shows the impact of the Group’s cash flow hedges in Other Comprehensive Income:
At 1 April
Effective element of changes in fair value arising from:
Cross-currency interest rate swaps
Fuel derivatives
Interest rate swaps relating to PPP contracts
At 31 March
2023
€m
(7.3)
–
(8.6)
12.3
(3.6)
2022
€m
(23.8)
0.1
5.7
10.7
(7.3)
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 221
SECTION 5. Capital structure and financing CONTINUED
5.5 DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES CONTINUED
Net investment hedge
Renewi plc, a Sterling functional currency company, has Euro borrowings of €200.0m (2022: €300.0m) with a fair value of €196.5m
(2022: €300.2m) which have been designated as a net investment hedge of the Group’s investments denominated in Euros. The hedge was
100% effective for the year ended 31 March 2023 (2022: 100%) and as a result the related exchange gain of €9.5m (2022: €3.0m loss) has been
recognised in the exchange reserve in the consolidated financial statements.
The following tables show the impact of the Group’s cash flow hedges and net investment hedge on the Balance Sheet, Other Comprehensive
Income and Income Statement:
HEDGING INSTRUMENT
HEDGED ITEM
Cumulative
cash flow
hedge
movement
in Other
Comprehensive
Income
€m
Hedge
ineffectiveness
included in
the Income
Statement in
the year
€m
Change in the
fair value used
to determine
hedge
effectiveness
€m
Change
in the fair
value used
to determine
hedge
effectiveness
€m
Cumulative
movement
in exchange
reserve
€m
Nominal
amount at 31
March 2023
€m
Weighted
average
hedged rate Hedge ratio
17.7
(8.6)
(1.7)
–
91.6
13.5
(1.9)
(0.9)
–
–
8.6
€0.62
per litre
(12.6)
4.07%
1:1
1:1
200.0
8.0
–
–
(24.7)
(8.0)
–
1:1
HEDGING INSTRUMENT
HEDGED ITEM
Cumulative
cash flow
hedge
movement
in Other
Comprehensive
Income
€m
Hedge
ineffectiveness
included in
the Income
Statement in
the year
€m
Change in the
fair value used
to determine
hedge
effectiveness
€m
Change
in the fair
value used
to determine
hedge
effectiveness
€m
Cumulative
movement
in exchange
reserve
€m
Nominal
amount at 31
March 2022
€m
Weighted
average
hedged rate Hedge ratio
–
14.7
100.9
–
5.7
6.3
–
6.9
0.1
–
(14.2)
(0.2)
–
–
–
–
1.32%
(5.7)
€0.46
per litre
(6.1)
4.07%
300.0
(2.5)
–
–
(15.3)
2.5
–
–
1:1
1:1
1:1
March 2023
Fuel derivatives/purchase of diesel
Interest rate swaps/
variable rate borrowings relating to
PPP contracts
Net investment hedge:
Euro borrowings/investment in Euro
denominated subsidiaries
March 2022
Cross-currency interest rate swaps/
variable rate borrowings
Fuel derivatives/purchase of diesel
Interest rate swaps/
variable rate borrowings relating to
PPP contracts
Net investment hedge:
Euro borrowings/investment in Euro
denominated subsidiaries
Strategic reportGovernance reportFinancial statementsOther information 222
SECTION 5. Capital structure and financing CONTINUED
5.6 FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES
Accounting policy
The Group classifies and measures its financial assets at amortised cost or at fair value (either through Other Comprehensive Income or
through profit or loss). The classification depends on the entity’s business model for managing the financial assets and the contractual term of
the cash flows.
Assets that are held for collection of contractual cash flows, where those cash flows represent solely payments of principal and interest, are
measured at amortised cost.
Derivatives are initially recognised at fair value and subsequently measured at fair value at the end of each reporting period. The accounting
for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument and, if so, the nature of the item
being hedged. Derivatives which are not hedging instruments are measured at fair value through profit or loss upon initial recognition
Short-term investments are classified and measured at fair value through profit or loss with changes in the fair value recognised in the Income
Statement. Unlisted investments not held for trading are held at fair value and the Group has elected to present subsequent changes in fair
value in Other Comprehensive Income. Dividends on these investments are recognised in the Income Statement when the Group’s right to
receive the dividends is established, it is probable that they will be paid and the amount can be reliably measured.
Financial liabilities are classified and measured at fair value through profit or loss or at amortised cost.
Fair value hierarchy
The Group uses the following hierarchy of valuation techniques to determine the fair value of financial instruments:
• Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
• Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly
or indirectly.
• Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.
During the year ended 31 March 2023, there were no transfers between level 1 and level 2 fair value measurements and no transfers into or out
of level 3.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 223
SECTION 5. Capital structure and financing CONTINUED
5.6 FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES CONTINUED
Valuation techniques used to derive level 2 fair values
• Unlisted non-current investments comprise unconsolidated companies where the fair value approximates the book value
• Short-term investment valuations are provided by the fund manager.
• Derivative financial instruments are determined by discounting the future cash flows using the applicable period-end yield curve.
• The fair values of the fixed interest rate bank loans and private placements are determined by discounting the future cash flows using the
applicable period-end yield curve.
• The fair value of retail bonds is based on indicative market pricing.
The table below presents the Group’s assets and liabilities measured at fair values:
Assets
Unlisted non-current investments (note 4.4)
Short-term investments (note 4.4)
Derivative financial instruments (note 5.5)
Liabilities
Derivative financial instruments (note 5.5)
Bank loans and private placements – fixed interest rates (note 5.3)
Retail bonds (note 5.3)
Carrying value of financial assets and financial liabilities
Financial assets
Financial assets at amortised cost
Loans to associates and joint ventures
Trade and other receivables at amortised cost#
Cash and cash equivalents
Financial assets relating to PPP contracts
Derivatives used for hedging
Fuel derivatives
Interest rate swaps relating to PPP contracts
Financial assets at fair value through profit or loss (mandatorily)
Short-term investments
Other receivables relating to invoice finance facilities
Financial assets at fair value through other comprehensive income
Unlisted non-current investments
LEVEL 2
2023
€m
4.6
10.9
1.6
17.1
4.5
110.6
196.5
311.6
2023
€m
1.0
261.9
62.7
131.0
0.4
1.2
10.9
10.8
4.6
484.5
2022
€m
4.6
11.1
7.0
22.7
14.7
25.7
300.2
340.6
2022
€m
0.9
243.4
63.6
143.4
7.0
–
11.1
9.5
4.6
483.5
Note
4.4
4.8
5.2
4.5
5.5
5.5
4.4
4.8
4.4
#Trade and other receivables at amortised cost comprise trade receivables and accrued income net of allowance of €257.3m (2022: €238.0m) and other receivables held at amortised cost
of €4.6m (2022: €5.4m).
The Group considers that the fair value of financial assets is not materially different to their carrying value.
Strategic reportGovernance reportFinancial statementsOther information 224
SECTION 5. Capital structure and financing CONTINUED
5.6 FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES CONTINUED
Financial liabilities
Financial liabilities at amortised cost
Bank loans, private placements and overdrafts
Retail bonds
Lease liabilities
Trade and other payables excluding non-financial liabilities#
PPP non-recourse debt
Derivatives used for hedging
Fuel derivatives
Interest rate swaps relating to PPP contracts
Note
5.3
5.3
5.3
4.9
5.3
5.5
5.5
2023
€m
205.8
199.5
254.8
423.5
88.3
2.1
2.4
Restated*
2022
€m
38.9
299.2
219.8
418.1
100.2
0.1
14.6
1,176.4
1,090.9
#Trade and other payables excluding non-financial liabilities comprises trade payables, other payables and accruals of €423.5m (2022: €418.1m).
*The comparatives relating to lease liabilities have been restated due to a prior year adjustment as explained in section 1 Basis of Preparation.
With the exception of retail bonds, private placements and fixed rate bank loans, the Group considers that the fair value of other bank
borrowings, trade and other payables and lease liabilities are not materially different to their carrying value.
5.7 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group is exposed to market risk (interest rate risk and commodity price risk), foreign exchange risk, liquidity risk and counterparty
credit risk. The Group’s Treasury Committee is charged with managing and controlling risk relating to the financing and liquidity of the
Group under policies approved by the Board of Directors. The Group does not enter into speculative transactions.
Interest rate risk
Changes in interest rates could have an impact on the interest cover covenant of the Group’s core facilities and on the interest charge in the
Income Statement. In order to monitor and manage the risk, borrowings and the expected interest cost for the year are regularly forecast and
sensitised for potential changes.
The Group has continued to limit its exposure to interest rate risk by using fixed rate retail bonds, European private placements, fixed rate lease
liabilities and fixed rate bank borrowings. The proportion of the Group’s total borrowings excluding PPP non-recourse floating rate borrowings
that were fixed at 31 March 2023 was €559.8m (2022: €554.3m) or 85% (2022: 95% restated). Additionally, the PPP non-recourse floating rate
borrowings are hedged using interest rate swaps which hedge the interest cash flows.
Interest rate swaps are accounted for under IFRS 9 with changes in the fair value recognised in Other Comprehensive Income, as they are
effective hedges. Any ineffectiveness is recognised in the Income Statement as a non-trading income or charge.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 225
SECTION 5. Capital structure and financing CONTINUED
5.7 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES CONTINUED
Interest rate sensitivity for bank borrowings
Interest on the floating rate revolving credit facilities will vary as interest rates increase or decrease. If rates had moved by 1% the impact on
profit before tax would have been a loss or gain of €1.1m (2022: €0.6m) based on the average bank borrowings during the year.
Interest rate sensitivity for PPP non-recourse borrowings
The PPP non-recourse borrowings are fully hedged with interest rate swaps. The fair values of interest rate swaps used for hedging of PPP
non-recourse borrowings are determined with reference to floating market interest rates. A 1% increase in interest rates would have reduced
the fair value of the interest rate swap liabilities and increased the interest rate swap assets and resulted in a pre-tax gain in Other
Comprehensive Income of €4.3m (2022: €6.2m) and a pre-tax gain in the Income Statement of €0.9m (2022: €0.7m). A 1% decrease in interest
rates would have increased the fair value of the interest rate swap liabilities and reduced the interest rate swap assets and led to a pre-tax loss
in Other Comprehensive Income of €4.7m (2022: €6.9m) and a pre-tax loss in the Income Statement of €1.0m (2022: €0.8m).
Foreign exchange risk
The Group operates in the UK and is exposed to translation risk on the value of assets denominated in Sterling into Euros. Renewi plc, a
Sterling functional currency company, has Euro borrowings which are designated as a net investment hedge of the Group’s investments
denominated in Euros. The Group has limited transactional risk as the Group’s subsidiaries conduct the majority of their business in their
respective functional currencies. Some risk arises in Euros on the export of processed waste from the UK to Europe.
Foreign exchange sensitivity
The impact of a change of Sterling foreign exchange rates of 10% on the Group’s profit before tax would be €3.2m (2022: €2.1m) and the impact
on underlying profit before tax would have been €1.4m (2022: €2.2m).
Commodity price risk and sensitivity
The Group is exposed to diesel price changes which are managed using forward contracts. The Group manages other exposures to prices of
paper, plastics, metals, residual fuels and other recyclates associated with off-take through commercial contracting. The impact of a change in
unhedged wholesale fuel prices (excluding duty) of 50% on the Group’s profit before tax would have been €3.2m (2022: €2.2m restated).
Credit risk
Credit risk is the risk of financial loss where counterparties are not able to meet their obligations. The Group’s principal financial assets are
cash and cash equivalents, trade and other receivables and financial assets relating to PPP contracts. The Group’s objective is to reduce its
exposure to counterparty default by restricting the type of counterparty it deals with and by employing an appropriate policy in relation to the
collection of trade receivables. The increased energy prices and high inflation as a result of the events in Ukraine are having a significant
impact on various sectors and industries and the impact has been considered when assessing the credit risk of the Group.
The Group recognises lifetime expected credit losses at the point of initial recognition for trade receivables and accrued income as set out in
note 4.8. For other financial assets, a loss allowance is recognised for expected credit losses taking into account changes in the level of credit
risk. Where credit risk is considered to be low, the loss allowance is limited to expected losses arising from default events that are possible
within 12 months from the balance sheet date. At 31 March 2023, taking into account the impact of macroeconomic factors, there has not been
a significant increase in credit risk in relation to receivables where the IFRS 9 general approach is followed to determine expected credit loss.
At 31 March 2023 the amount of credit risk on cash and cash equivalents totalled €62.7m (2022: €63.6m). The banks and financial institutions
used by the Group for core cash and cash equivalents are restricted to those with the appropriate geographical presence and suitable credit
rating. The Group has an objective to minimise cash and where possible repay the Group borrowings to manage counterparty credit risk
amongst other objectives. The restricted cash relating to PPP contracts is managed in accordance with the guidelines specific to each of the
PPP contracts. Expected credit losses over cash and cash equivalents are considered to be immaterial with no losses experienced.
Strategic reportGovernance reportFinancial statementsOther information 226
SECTION 5. Capital structure and financing CONTINUED
5.7 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES CONTINUED
Trade and other receivables mainly comprise amounts due from customers for services performed. Each division monitors the level of trade
receivables on a monthly basis, continually assessing the risk of default by any counterparty taking into account that the Group uses credit
insurance to minimise the credit risk of trade receivables. As a result of increased energy prices and high inflation due to the events in Ukraine
a detailed review has been undertaken at a customer level in some cases, in order to assess the likely potential of default considering
the nature of the customers business and any government support measures. At 31 March 2023 the amount of credit risk on trade and other
receivables amounted to €261.9m (2022: €243.4m). The Group does not hold any collateral as security.
The financial assets relating to PPP contracts are recoverable from the future revenues relating to these contracts. Management consider these
to be very low risk as the counterparties for the future revenues are local authorities or councils in the UK. This is reviewed on a regular basis
and there has been no change in the capacity of the counterparties to meet the contractual cash flow obligations. At 31 March 2023 the
amount of credit risk on financial assets amounted to €131.0m (2022: €143.4m).
For derivative financial assets the maximum exposure to credit risk at the reporting date is the net fair value of the derivative assets which are
included in the consolidated statement of financial position.
No other loans to associates or joint ventures are credit impaired.
5.8 CAPITAL MANAGEMENT
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to provide optimal returns
for shareholders, maintain an efficient capital structure to reduce the cost of capital and provide appropriate levels of liquidity headroom. In
order to meet these objectives, the Group may issue or repay debt, issue new shares or adjust the amount of dividend paid to shareholders.
No dividends were paid for the year ended 31 March 2022 and no dividend is being paid for the year ended March 2023. The Board will
continue to review the reinstatement of dividends taking into consideration the trading performance, macroeconomic outlook and changes in
the investment and growth opportunities for the Group.
The following table shows the capital of the Group:
Total borrowings
Less: PPP non-recourse borrowings
Less: Lease liabilities as a result of the adoption of IFRS 16
Less: core cash and cash equivalents (excluding restricted cash at bank relating to PPP contracts)
Net debt aligned with covenant definition
Total equity
Total capital
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of Preparation.
Note
5.3
5.3
5.2
2023
€m
748.4
(88.3)
(245.8)
(43.7)
370.6
347.3
717.9
Restated*
2022
€m
658.1
(100.2)
(212.4)
(42.5)
303.0
341.9
644.9
The Group monitors its financial capacity by reference to key financial ratios which provide a framework within which the Group’s capital base
is managed. The Group’s Euro denominated multicurrency green finance facility agreements have covenants including adjusted net debt to
comparable adjusted EBITDA and interest cover in accordance with a frozen GAAP concept. The additional bank borrowing drawn during the
year ended March 2023 also have covenants which are broadly in line with those of the multicurrency facility. The Group has complied with its
banking covenants during the year.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 227
SECTION 5. Capital structure and financing CONTINUED
5.9 EQUITY
Accounting policy
Share capital and share premium
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or share options are shown
in equity as a deduction, net of tax, from the proceeds. The share premium account represents any excess of the net proceeds over the
nominal value of any shares issued.
At the Annual General Meeting of Renewi plc held on 15 July 2021, shareholders approved the consolidation of the Company’s share capital on
the basis of one new ordinary share with a nominal value of £1.00 each for every ten existing ordinary shares of 10 pence each held. This was
subsequently completed on 19 July 2021 when the issued share capital of 800,236,740 10 pence shares was replaced with 80,023,674 £1 shares.
Share capital allotted, called up and fully paid
At 1 April 2021 (ordinary shares of 10p each)
Issued under share option schemes – prior to share consolidation (ordinary shares of 10p each)
Ordinary shares of 10p each held on 19 July prior to the consolidation
Adjustment to number of shares following the share consolidation
Issued under share option schemes (ordinary shares of £1 each)
At 31 March 2022 (ordinary shares of £1 each)
Issued under share option schemes (ordinary shares of £1 each)
At 31 March 2023 (ordinary shares of £1 each)
SHARE CAPITAL
ORDINARY SHARES
SHARE
PREMIUM
Number
800,141,536
95,204
800,236,740
(720,213,066)
36,263
80,059,937
190,358
80,250,295
€m
99.5
–
99.5
–
–
99.5
0.3
99.8
€m
473.6
–
473.6
–
0.2
473.8
0.3
474.1
During the year 190,358 (2022: 36,263) ordinary shares of £1 were allotted, additionally during the prior year 95,204 ordinary shares of 10p each
were allotted prior to the share consolidation. These new shares resulted from the exercise of share options under the Savings Related Share
Option Schemes for an aggregated consideration of €0.6m (2022: €0.2m). Further disclosures relating to share-based options are set out in
note 7.3.
Exchange reserve
The exchange reserve comprises all foreign exchange differences arising from the translation of the financial statements of non-Euro
denominated operations since 1 April 2005, the date the Group converted to IFRS, excluding those disposed of, as well as from the translation
of liabilities that hedge the Group’s net investment in foreign operations.
Retained earnings
The Group includes within retained earnings the cumulative balance relating to the effective portion of hedging instruments carried at fair
value in a qualifying cash flow hedge and further details are provided in note 5.5.
The Group also includes the cumulative impact of the Renewi Employee Share Trust within retained earnings. The Trust owns 853,223
£1 shares (1.1%) (2022: 552,851 £1 shares (0.7%)) of the issued share capital of the Company in trust for the benefit of employees of the Group.
The Trust waives its dividend entitlement. During the year 400,597 (2022: 34,580) £1 shares were transferred to individuals under the LTIP and
DAB schemes and in the prior year 798,433 10 pence shares were transferred to individuals under the LTIP and DAB schemes prior to the share
consolidation. During the year 700,969 £1 shares (2022: 237,000 £1 shares) were purchased by the Trust at a cost of €5.3m (2022: €1.8m).
Strategic reportGovernance reportFinancial statementsOther information 228
SECTION 5. Capital structure and financing CONTINUED
5.9 EQUITY CONTINUED
Non-controlling interests
The information below reflects the amounts included in the Group’s Income Statement and Balance Sheet for subsidiaries with material
non-controlling interests.
Revenue
Profit after tax
Total comprehensive income
Total comprehensive income allocated
to the non-controlling interests
Dividends paid to non-controlling interests
Non-current assets
Current assets
Non-current liabilities
Current liabilities
Net assets
Accumulated non-controlling interests
Net (decrease) increase in cash and cash equivalents
Maltha Groep
€m
69.8
9.8
9.8
3.3
–
29.3
22.5
(3.2)
(24.6)
24.0
8.0
(2.3)
2023
Others
€m
45.9
2.3
2.3
0.4
0.6
8.3
17.2
(1.1)
(13.5)
10.9
2.1
1.4
Total
€m
115.7
12.1
12.1
3.7
0.6
37.6
39.7
(4.3)
(38.1)
34.9
10.1
(0.9)
Maltha Groep
€m
60.2
1.8
1.8
0.5
–
24.0
19.5
(4.1)
(25.2)
14.2
4.7
(0.1)
2022
Others
€m
37.3
3.1
3.1
0.4
–
8.1
11.6
(1.3)
(6.6)
11.8
2.3
–
Total
€m
97.5
4.9
4.9
0.9
–
32.1
31.1
(5.4)
(31.8)
26.0
7.0
(0.1)
5.10 DIVIDENDS
Accounting policy
Final dividend distributions to the equity holders are recognised in the period in which they are approved by the shareholders in general
meeting. Interim dividends are recognised when paid.
The Directors have not recommended a final dividend for the year ended March 2023 (2022: nil).
Section 6. Acquisitions and disposals
This section provides details of acquisitions and disposals.
6.1 ACQUISITIONS
Accounting policy
The Group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of the
subsidiary is the fair value of assets transferred, liabilities incurred or assumed including any equity interests issued by the Group. Identifiable
assets acquired and liabilities and contingent liabilities assumed, meeting the conditions for recognition under IFRS 3, are recognised at their
fair value at the acquisition date. The fair value of businesses acquired may include waste permits, licences and customer relationships with
the value recognised as intangible assets and amortised. The method for calculating the intangible asset is determined for each acquisition
which include the Income approach (multi-period excess earnings method or the with-or-without method) and the Cost approach. The excess
of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. The Group
recognises any non-controlling interest in the acquired entity on an acquisition basis either at fair value or at the non-controlling interest’s
proportionate share of the acquired entity’s net identifiable assets. The costs of acquisition are charged to the Income Statement in the year in
which they are incurred.
Acquisition of GMP Exploitatie B.V.
On 1 August 2022 the Group acquired 100% of the share capital of GMP Exploitatie B.V. and its subsidiaries (subsequently renamed Renewi
Westpoort Holding B.V.) for a cash consideration of €53.5m. In addition to the cash purchase consideration paid of €53.5m, the Group
immediately settled an acquired €7.0m bank loan.
The business operates from a large and well permitted processing facility located in the port area of Amsterdam. The site of 130,000m2 has
excellent road and water access operating two advanced sorting lines for processing mixed construction and demolition waste as well as
household waste. In addition, a minerals classification and washing installation produces secondary construction materials from construction
and demolition waste. The acquisition will deliver synergies from site rationalisation, route and waste flow optimisation and other operational
benefits as part of the Group’s Netherlands Commercial Waste division CGU.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 229
SECTION 6. Acquisitions and disposals CONTINUED
6.1 ACQUISITIONS CONTINUED
The asset identification and fair value allocation processes has been finalised and the table below shows the final values. External specialists
were engaged to assist with determining the final balance sheet specifically with regard to intangible assets acquired. The Group has
separately identified customer relationships and permits as acquisition related intangibles. The goodwill arising on the acquisition is
attributable to management’s expectations of synergies to be achieved post acquisition. None of the goodwill on this acquisition is deductible
for tax, however deferred tax at a tax rate of 25.8% has been recognised on acquisition intangibles as required under IAS 12 Income Taxes.
Key Valuation methods
Permits – The acquisition included a mix of permits with an infinite lifetime and these were valued following the Income approach – multi-
period excess earning method. The key assumptions are revenue, EBITDA and contributory asset charges in order to determine the
appropriate cash flows which are then discounted. As the permits are linked to the site which is located on leased land, the remaining useful
life is determined to be equal to the term of the 34 year lease.
Customer relationships – The acquisition included both inbound and outbound customers and the fair value has been calculated by
following the Income approach – with-or-without method. The key assumptions are the post-tax cash flows and the time taken to ramp-up to
the current customer base. The remaining useful life is determined to be 8 years.
Land and buildings – The buildings are located on leasehold land. Two external real estate advisers performed valuations based on the
existing lease arrangement. The acquisition value was adjusted to take account of the favourable element of the land lease which has been
added to the right-of-use asset. The remaining useful life is determined to be 34 years in line with the lease term.
Intangible assets – Permits
Intangible assets – Customer relationships
Property, plant and equipment
Right-of-use assets
Trade and other receivables
Inventories
Current tax receivable
Trade and other payables
Provisions
Deferred tax liabilities
Borrowings – Bank loan
Borrowings – Lease liabilities
Net identifiable assets acquired
Add: Goodwill arising on acquisition
Net assets acquired
Purchase consideration
Cash consideration
Less: Cash balances acquired
Net cash outflow – investing activities
Fair value
acquired
€m
6.0
21.6
18.0
38.4
9.4
0.3
0.2
93.9
(8.9)
(1.3)
(9.6)
(7.0)
(30.7)
(57.5)
36.4
17.1
53.5
Total
€m
53.5
–
53.5
Strategic reportGovernance reportFinancial statementsOther information 230
SECTION 6. Acquisitions and disposals CONTINUED
6.1 ACQUISITIONS CONTINUED
In the period from the acquisition to 31 March 2023 the business contributed €30.2m to the Group’s revenue and a loss of €2.6m to the Group’s
profit after tax. If the acquisition had been completed on the first day of the financial year, the business would have contributed €51.8m to the
Group’s revenue and a loss of €3.1m to the Group’s profit after tax. Acquisition related costs of €0.4m were recognised within administrative
costs.
Others
In addition, during September 2022 the Netherlands Commercial division completed a business assets acquisition for cash consideration of
€1.6m. The assets acquired were €1.0m of plant and machinery with €0.3m allocated to an acquisition related intangible for customer lists and
the balance of €0.3m to goodwill.
During the prior year the Netherlands Commercial Division acquired plant and machinery business assets of €0.2m and acquisition related
intangible customer lists of €0.3m.
6.2 DISPOSALS
Accounting policy
The results of operations disposed of during the year are included in the consolidated Income Statement up to the date of disposal, unless
they meet the criteria of a discontinued operation.
On 27 June 2022 the Mineralz & Water division disposed of net liabilities totalling €3.6m in relation to its North business for a cash
consideration of €0.2m generating a profit on sale of €3.8m which has been recorded as a non-trading and exceptional item in line with the
Group’s policy due to the significant value of the profit.
On 5 August 2022 the Specialities division sold its Maltha Hungary entity. Net liabilities of €0.8m were sold for a cash consideration net of cash
sold of €0.1m which generated a profit on sale of €0.9m. The profit on sale which included the impact of a recycled cumulative currency
translation has been recorded in underlying EBIT.
There were no disposals in the prior year.
6.3 ASSETS CLASSIFIED AS HELD FOR SALE
Accounting policy
Assets classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell. Assets are classified as held
for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. This condition is regarded as
met only when the sale is highly probable and the assets are available for sale in their present condition. Following the classification as held
for sale, non-current assets are not depreciated.
The Group had €0.6m (2022: €3.3m) assets classified as held for sale at 31 March 2023, these relate to land and buildings in the Belgium
Commercial Division which are expected to be sold within the next 12 months. The prior year value also included €2.0m land and buildings at
a Netherlands Commercial Division site and €1.3m in the Belgium Commercial Division in relation to an associate of €0.7m and land and
buildings of €0.6m.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 231
SECTION 7. Employee benefits
7.1 EMPLOYEE COSTS AND EMPLOYEE NUMBERS
This note shows the staff costs and the average monthly number of employees analysed by reportable segment.
Wages and salaries
Social security costs
Share-based benefits
Other pension costs
Total staff costs
The average number of employees by reportable segment during the year was:
Commercial Waste
Mineralz & Water
Specialities
Group central services
Total average number of employees
7.2 RETIREMENT BENEFIT SCHEMES
The Group operates defined benefit and defined contribution schemes in the UK and overseas.
Accounting policy
The Group accounts for pensions and similar benefits under IAS 19 (revised) Employee Benefits.
Note
7.3
7.2
2023
€m
336.3
62.2
2.7
32.0
433.2
2022
€m
311.6
56.6
2.5
31.8
402.5
2023
2022
4,621
323
877
414
6,235
4,568
337
864
384
6,153
The pension cost for the defined benefit schemes is assessed in accordance with management’s best estimates using the advice of an
independent qualified actuary and assumptions in the latest actuarial valuation. For defined benefit plans, obligations are measured
at discounted present value. Plan assets in the UK scheme are recorded at fair value and in the overseas schemes the plan assets are
calculated as the cash value of all future insured benefit payments using an appropriate discount rate. The operating and financing costs of
the plans are recognised separately in the Income Statement. Interest is calculated by applying the discount rate to the net defined pension
liability. Actuarial gains and losses are recognised in full through the Statement of Comprehensive Income and surpluses are recognised only
to the extent that they are recoverable. Movements in irrecoverable surpluses are recognised immediately in the Statement of Comprehensive
Income.
Payments to defined contribution schemes are charged to the Income Statement as they become due. The Group participates in several
multi-employer schemes in the Netherlands which are accounted for as defined contribution plans as it is not possible to split the assets and
liabilities of the schemes between participating companies. The Group has been informed by the schemes that it has no obligation to make
additional contributions in the event that the schemes have an overall deficit.
Retirement benefit schemes costs
UK defined contribution scheme
Overseas defined benefit schemes
Overseas defined contribution schemes
2023
€m
1.7
1.4
28.9
32.0
2022
€m
1.7
2.3
27.8
31.8
Strategic reportGovernance reportFinancial statementsOther information
232
SECTION 7. Employee benefits CONTINUED
7.2 RETIREMENT BENEFIT SCHEMES CONTINUED
UK defined benefit scheme
The UK defined benefit pension scheme (called the Shanks Group Pension Scheme) provides pension benefits for pensioners, deferred
members and eligible UK employees and is closed to new entrants and closed to future benefit accrual. The defined benefit scheme provides
benefits to members in the form of a guaranteed level of pension payable for life and the level of benefits provided depends on the members’
length of service and final salary. Plan assets are managed by Aon Investments Ltd on behalf of the Trustees. There are four trustees currently,
two appointed by the Company and two nominated by members, who are responsible for ensuring the scheme is run in accordance with the
members’ best interests and the pension laws of the UK which are overseen by The Pensions Regulator.
The most recent triennial actuarial valuation of the Scheme, which was performed by an independent qualified actuary for the Trustees of the
Scheme, was carried out as at 5 April 2021. The Group has agreed to pay annual deficit contribution of €3.5m (£3.1m) until December 2024.
The total estimated contributions expected to be paid to the scheme in the year ending 31 March 2024 are €3.5m.
The significant actuarial assumptions adopted at the balance sheet date were as follows:
Discount rate
Rate of price inflation
Consumer price inflation
2023
% p.a.
4.9
3.3
2.7
2022
% p.a.
2.8
3.6
3.0
The discount rate assumption is derived from the single agency curve based on high quality AA rated bonds. The mortality assumptions are
based on standard mortality tables which allow for future mortality improvements. The assumptions are that a member currently aged 65 will
live on average for a further 23 years (2022: 23 years) if they are male and for a further 25 years (2022: 25 years) if they are female. For a member
aged 40 who retires at age 65 the assumptions are that they will live on average after retirement for around a further 24 years (2022: 24 years) if
they are male or for a further 27 years (2022: 27 years) if female. The weighted average duration of the defined benefit obligation is
approximately 13 years.
Overseas defined benefit schemes
The overseas defined benefit obligation relates to funded plans, mainly insurance contracts managed by insurers, in both the Netherlands and
Belgium. There are various schemes which are based on average salaries and in some cases on final salaries. The assets consist of qualifying
insurance policies which match the vested benefits. The build-up of rights for inactive members are indexed on the basis of additional interest
and the rights of active employees are being indexed unconditionally with the price-inflation figure. There are no unfunded plans. The plans
are subject to laws for pension insurance companies offering pension arrangements and are overseen by Autoriteit Financiele Markten in the
Netherlands and Autoriteit voor Financiele Diensten en Markten in Belgium. The Group has no responsibilities for governance of the plans
other than correct calculation and timely payment of the contributions. The total estimated contributions expected to be paid to the schemes
in the year ending 31 March 2024 are €2.1m.
The significant actuarial assumptions adopted at the balance sheet date were as follows:
Discount rate
Rate of price inflation
Rate of salary inflation
2023
% p.a.
2022
% p.a.
2.4 to 3.9
1.7 to 2.0
2.0
2.0
2.5 to 4.0
2.0 to 2.5
The discount rate assumption is based on interest rates applying to high quality corporate bonds with a term approximately equal to the term
of the related pension liability. The mortality assumptions are based on standard mortality tables which allow for future mortality
improvements. The assumptions are that a member currently aged 65 will live on average for a further 22 years (2022: 21 years) if they are male
and for a further 24 years (2022: 23 years) if they are female. For a member aged 40 who retires at age 65 the assumptions are that they will live
on average after retirement for around a further 23 years (2022: 23 years) if they are male or for a further 25 years (2022: 25 years) if female. The
maturity of the schemes ranges from 18 to 22 years.
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
233
SECTION 7. Employee benefits CONTINUED
7.2 RETIREMENT BENEFIT SCHEMES CONTINUED
The amounts recognised in the financial statements for all defined benefit schemes are as follows:
Income Statement
Current service cost
Curtailment
Interest (income) expense on scheme net liabilities
Net defined benefit pension schemes (credit) charge before
tax
Statement of Comprehensive Income
Actuarial gain on scheme liabilities
Actuarial loss on scheme assets
Actuarial (loss) gain on defined benefit pension schemes
2023
Overseas
€m
1.7
(0.3)
–
1.4
2023
Overseas
€m
18.5
(17.6)
0.9
UK
€m
–
–
(0.2)
(0.2)
UK
€m
46.5
(62.9)
(16.4)
Total
€m
1.7
(0.3)
(0.2)
1.2
Total
€m
65.0
(80.5)
(15.5)
2022
Overseas
€m
2.3
–
0.1
2.4
2022
Overseas
€m
8.2
(6.7)
1.5
UK
€m
–
–
–
–
UK
€m
14.8
(5.8)
9.0
Total
€m
2.3
–
0.1
2.4
Total
€m
23.0
(12.5)
10.5
Cumulative actuarial gains and losses recognised in the Statement of Comprehensive Income since 1 April 2004 are losses of €45.9m (2022:
€30.4m).
Balance Sheet
Present value of deferred benefit obligations
Fair value of plan assets
Defined benefit pension schemes net (deficit) asset
Related deferred tax asset (note 3.4)
Net defined pension schemes (liability) asset
Classified as:
Defined benefit scheme surplus – included in non-current assets
Defined benefit pension schemes deficit – included
in non-current liabilities
Defined benefit pension schemes net (deficit) asset
UK
€m
(144.5)
140.2
(4.3)
1.1
(3.2)
–
(4.3)
(4.3)
2023
Overseas
€m
(56.6)
51.6
(5.0)
1.3
(3.7)
–
(5.0)
(5.0)
Total
€m
(201.1)
191.8
(9.3)
2.4
(6.9)
–
(9.3)
(9.3)
2022
Overseas
€m
(74.5)
68.2
(6.3)
1.6
(4.7)
–
(6.3)
(6.3)
UK
€m
(201.2)
209.8
8.6
(2.1)
6.5
8.6
–
8.6
The UK scheme’s assets of €140.2m (2022: €209.8m) are invested via Aon’s Delegated Consulting Service which is a fiduciary investment
management platform managed by Aon Investments Limited. A breakdown of the underlying investment classes is given below:
Equities
Liquid alternatives
Fixed income
Liability driven investment
Cash and others
2023
€m
44.8
19.3
17.6
51.3
7.2
Total
€m
(275.7)
278.0
2.3
(0.5)
1.8
8.6
(6.3)
2.3
2022
€m
87.7
23.6
24.1
65.8
8.6
The overseas schemes assets of €51.6m (2022: €68.2m) are insurance contracts managed by insurers in the Netherlands and Belgium.
140.2
209.8
Strategic reportGovernance reportFinancial statementsOther information 234
SECTION 7. Employee benefits CONTINUED
7.2 RETIREMENT BENEFIT SCHEMES CONTINUED
The movement in the defined benefit pension schemes deficit
At 1 April 2021
Current service cost
Interest expense
Net actuarial gain recognised in the year
Contributions from employer
Exchange rate changes
At 31 March 2022
Current service cost
Curtailment
Interest income
Net actuarial (loss) gain recognised in the year
Contributions from employer
Exchange rate changes
At 31 March 2023
Reconciliation of the defined benefit obligation
At 1 April 2021
Current service cost
Interest expense
Remeasurements:
Actuarial gain on scheme liabilities arising from changes in financial assumptions
Actuarial (loss) gain on scheme liabilities arising from change in demographic assumptions
Actuarial gain (loss) on scheme liabilities arising from changes in experience
Contributions from plan participants
Benefit payments
Exchange rate changes
At 31 March 2022
Current service cost
Curtailment
Interest expense
Remeasurements:
Actuarial gain on scheme liabilities arising from changes in financial assumptions
Actuarial loss on scheme liabilities arising from changes in experience
Contributions from plan participants
Benefit payments
Exchange rate changes
At 31 March 2023
UK
€m
(4.0)
–
–
9.0
3.5
0.1
8.6
–
–
0.2
(16.4)
3.5
(0.2)
(4.3)
UK
€m
(216.7)
–
(4.3)
15.3
(4.4)
3.9
–
6.5
(1.5)
(201.2)
–
–
(5.3)
54.1
(7.6)
–
7.8
7.7
Overseas
€m
(7.4)
(2.3)
(0.1)
1.5
2.0
–
(6.3)
(1.7)
0.3
–
0.9
1.8
–
(5.0)
Overseas
€m
(79.9)
(2.6)
(0.9)
9.0
0.8
(1.6)
(0.5)
1.2
–
(74.5)
(1.3)
1.3
(1.2)
19.4
(0.9)
(0.6)
1.2
–
Total
€m
(11.4)
(2.3)
(0.1)
10.5
5.5
0.1
2.3
(1.7)
0.3
0.2
(15.5)
5.3
(0.2)
(9.3)
Total
€m
(296.6)
(2.6)
(5.2)
24.3
(3.6)
2.3
(0.5)
7.7
(1.5)
(275.7)
(1.3)
1.3
(6.5)
73.5
(8.5)
(0.6)
9.0
7.7
(144.5)
(56.6)
(201.1)
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 SECTION 7. Employee benefits CONTINUED
7.2 RETIREMENT BENEFIT SCHEMES CONTINUED
Reconciliation of plan assets
At 1 April 2021
Current service cost
Interest income
Remeasurements: Return on plan assets excluding interest expense
Contributions from employer
Contributions from plan participants
Benefit payments
Exchange rate changes
At 31 March 2022
Current service cost
Curtailment
Interest income
Remeasurements: Return on plan assets excluding interest expense
Contributions from employer
Contributions from plan participants
Benefit payments
Exchange rate changes
At 31 March 2023
235
UK
€m
212.7
–
4.3
(5.8)
3.5
–
(6.5)
1.6
209.8
–
–
5.5
(62.9)
3.5
–
(7.8)
(7.9)
140.2
Overseas
€m
72.5
0.3
0.8
(6.7)
2.0
0.5
(1.2)
–
68.2
(0.4)
(1.0)
1.2
(17.6)
1.8
0.6
(1.2)
–
51.6
Total
€m
285.2
0.3
5.1
(12.5)
5.5
0.5
(7.7)
1.6
278.0
(0.4)
(1.0)
6.7
(80.5)
5.3
0.6
(9.0)
(7.9)
191.8
Significant defined benefit pension scheme risks
Through its defined benefit pension schemes the Group is exposed to a number of risks, the most significant of which are set out below.
Asset volatility – The UK scheme liabilities are calculated using a discount rate set with reference to corporate bond yields and if plan assets
under perform this yield, this will result in a shortfall. The UK pension scheme’s assets are held in a portfolio of pooled funds which are single
priced at the net asset value. The investment objective of the portfolio is to achieve long-term total returns in excess of a nominal portfolio of
long-dated Sterling bonds through a diversified portfolio of collective investment schemes, which may include derivatives. Investments are
well diversified, such that the failure of any single investment would not have a material impact on the overall level of assets. The Trustees
have agreed an underlying strategy with the Group so that any ongoing improvements in the scheme’s funding position would trigger
movements from growth assets to non-growth assets in order to protect and consolidate such improvements. The plan assets in the overseas
pension schemes are calculated as the cash value of all future insured benefit payments using an appropriate discount rate.
Inflation risk – The majority of benefit obligations are linked to inflation and higher inflation will lead to higher liabilities.
Life expectancy – The majority of the obligations are to provide benefits for the life of the member, so increases in the life of the member will
result in an increase in the liabilities.
Changes in bond yields – A decrease in corporate bond yields will increase plan liabilities, although this will be partially offset by an increase
in the value of the investments.
Sensitivities for defined pension benefit schemes
The sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to
occur, as changes in assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial
assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of
the reporting period) has been applied as when calculating the pension liability recognised within the Balance Sheet.
Discount rate
Rate of price inflation
Consumer price inflation
IMPACT ON DEFINED BENEFIT OBLIGATION
UK
OVERSEAS
Change in
assumption
%
Increase in
assumption
€m
Decrease in
assumption
€m
Change in
assumption
%
Increase in
assumption
€m
Decrease in
assumption
€m
0.25
0.25
0.25
4.6
(2.8)
(2.8)
(4.9)
4.6
4.6
0.25
0.25
–
2.2
–
–
(2.3)
0.1
–
Strategic reportGovernance reportFinancial statementsOther information
236
SECTION 7. Employee benefits CONTINUED
7.2 RETIREMENT BENEFIT SCHEMES CONTINUED
Life expectancy
UK
OVERSEAS
Increase
by 1 year in
assumption
€m
Decrease
by 1 year in
assumption
€m
Increase
by 1 year in
assumption
€m
Decrease
by 1 year in
assumption
€m
(7.1)
6.3
(1.1)
1.2
Other overseas schemes
The total cost in the year for other overseas pensions was €28.9m (2022: €27.8m). In the Netherlands in particular, most employees are
members of either a multi-employer pension scheme or other similar externally funded schemes, including Government funded schemes.
7.3 SHARE-BASED PAYMENTS
As described in the Directors’ Remuneration Report, the Group issues equity-settled share-based payments under a Savings Related
Share Option Scheme (SRSOS), a Long-Term Incentive Plan (LTIP) and a Deferred Annual Bonus (DAB) arrangement. Further details and
performance metrics of both LTIPs and DABs can be found in the Directors’ Remuneration Report on pages 140 to 157.
Accounting policy
The Group issues equity-settled share-based awards to certain employees. The fair value of share-based awards is determined at the date of
grant and expensed on a straight-line basis over the vesting period with a corresponding increase in equity based on the Group’s estimate of
the shares that will eventually vest. At each balance sheet date the Group revises its estimates of the number of awards that are expected to
vest based on service and non-market performance conditions. The amount expensed is adjusted over the vesting period for changes in the
estimate of the number of shares that will eventually vest, except for changes resulting from any market-related performance conditions.
At the Annual General Meeting of Renewi plc held on 15 July 2021, shareholders approved the consolidation of the Company’s share capital on
the basis of one new ordinary share with a nominal value of £1.00 each for every ten existing ordinary shares of 10 pence each held. This
adjustment has been applied to the outstanding awards and options as presented below.
Outstanding awards and options
SRSOS
LTIP
DAB
Outstanding at 1 April 2021
Forfeited
Expired
Exercised/vested
Outstanding on 19 July 2021 prior to share consolidation
Adjustment to the number of shares following the share consolidation
Granted
Forfeited
Exercised/vested
Outstanding at 31 March 2022
Granted
Forfeited
Exercised/vested
Outstanding at 31 March 2023
Exercisable at 31 March 2023
Exercisable at 31 March 2022
At 31 March 2023:
Range of price per share at exercise
Weighted average remaining contractual life
Number of
awards
Number of
awards
12,909,649
1,475,934
(650,750)
(1,976,460)
–
–
(573,802)
(155,535)
9,708,637
1,320,399
(8,737,775)
(1,188,361)
487,111
(35,000)
–
1,422.973
365,367
(164,024)
(359,624)
69,159
–
(34.580)
166,617
45,596
(42,299)
(29,432)
1,264,692
140,482
Number of
options
7,374,083
(350,341)
(119,120)
(95,200)
6,809,422
(6,128,480)
89,323
(62,527)
(36,263)
671,475
66,885
(110,587)
(190,358)
437,415
1,728
6,436
Weighted
Average
exercise
price
24p
22p
76p
23p
23p
–
422p
242p
417p
245p
608p
292p
249p
288p
250p
520p
200p to 608p
1 year
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
237
SECTION 7. Employee benefits CONTINUED
7.3 SHARE-BASED PAYMENTS CONTINUED
Fair value of awards and options granted during the year
Valuation model
Weighted average fair value
Weighted average share price
Weighted average exercise price
Expected volatility
Expected life
Risk-free interest rate
Dividend yield
SRSOS
LTIP
2023
Binomial
2022
Binomial
2023
Share price
and Finnerty
2022
Share price
and Finnerty
2023
Monte Carlo
and Finnerty
2022
Monte Carlo
and Finnerty
200p
580p
608p
49%
3 years
4.44%
1.6%
223p
555p
422p
51%
3 years
0.25%
2.2%
655p
681p
–
–
508p
548p
–
–
3 years
3 years
–
–
–
–
485p
681p
52%
3 years
2.2%
–
362p
548p
–
53%
3 years
0.16%
–
LTIP awards
LTIP awards are issued to the senior leadership of the Group at the discretion of the Remuneration Committee. Vesting of the awards is subject
to continued employment together with a market condition (relative TSR) and non-market conditions (EPS, ROCE and recycling rate) as further
explained in the Directors’ Remuneration report. The awards granted vest after three years, four years and five years. There is no service
condition after three years on any of the awards granted, just a holding period of between one and two years. The fair value of the element
subject to non-market conditions has been calculated based on the share price at the award date and the expense recognised is based on
expectations of these conditions being met which are reassessed at each balance sheet date. The Monte Carlo valuation model is used to
determine the weighted average fair value of the market conditions element of awards granted. Using a Finnerty model, post-vesting
restrictions are included in the fair value measurement at the date of grant to the extent that the restrictions affect the price that a
knowledgeable, willing market participant would pay for the shares. Expected volatility has been calculated using average volatility historical
data over a three-year period from the grant date. The risk-free interest rate is based on the implied yield of zero-coupon UK government
bonds with a remaining term equal to the expected life. The expected life used in the models equals the vesting period.
SRSOS options
UK employees are invited to join the Sharesave plan when an offer is made each year. These plans are for three years and subject to continued
employment. All offers to date were issued at a 20% discount to market price at the time. There are no performance criteria for this plan.
DAB awards
On award the annual bonus of the executive directors is split 50% payable in cash and 50% payable in Renewi plc shares resulting in a
deferred annual bonus. The conditions are explained in full within the Directors’ Remuneration report.
Charge for the year
The Group recognised a total charge of €2.7m (2022: €2.5m) relating to equity-settled share-based payments. The DAB awards for the year
ended 31 March 2023 have not yet been granted and therefore the charge is based on an estimate.
Strategic reportGovernance reportFinancial statementsOther information 238
SECTION 8. Other notes
8.1 SUBSIDIARY UNDERTAKINGS AND INVESTMENTS AT 31 MARCH 2023
The structure of the Group includes a number of different operating and holding companies that contribute to the consolidated financial
performance and position.
Subsidiary undertakings
In accordance with section 409 of the Companies Act, a full list of subsidiaries at 31 March 2023 is disclosed below by country of incorporation
which is the principal country of business. All are wholly owned by the Group and have a 31 March year end, unless otherwise stated, and all
operate in the waste management sector and have been consolidated in the Group’s financial statements. Those subsidiaries owned directly
by Renewi plc, the parent company, are indicated with an asterisk.
Subsidiary
Incorporated in the Netherlands
ATM B.V.
A&G Holding B.V.
Bureau ontwerp & omgevin B.V.
B.V. Twente Milieu Bedrijven
CFS B.V.
Cirqu B.V.
Coolrec B.V.
Coolrec Nederland B.V.
Coolrec Plastics B.V.
EcoSmart Nederland B.V.
Glasrecycling Noord-Oost Nederland B.V. (67%)
Maltha Glasrecycling Nederland B.V. (67%)
Maltha Glassrecycling International B.V. (67%)
Maltha Groep B.V. (67%)
Mineralz B.V.
Mineralz Maasvlakte B.V.
Mineralz Zweekhorst B.V.
Orgaworld International B.V.
Orgaworld Nederland B.V.
Orgaworld WKK 1 B.V.
Orgaworld WKK II B.V.
Orgaworld WKK III B.V.
Renewi Commercial B.V.
Renewi Europe B.V.
Renewi Hazardous Waste B.V.
Renewi Icopower B.V.
Renewi Monostreams B.V.
Renewi Nederland B.V.
Renewi Netherlands Holdings B.V.
Renewi Overheidsdiensten B.V.
Renewi Smink B.V.
Renewi Support B.V.
Renewi Westpoort B.V.
Renewi Westpoort Holding B.V.
Renewi Westpoort Transport B.V.
Robesta Vastgoed Acht B.V.
Robesta Vastgoed B.V.
Semler B.V.
Address of the registered office
Vlasweg 12, 4782 PW Moerdijk, Netherlands
Van Hilststraat 7, 5145 RK Waalwijk, Netherlands
Velperweg 157, 6824 MB Arnhem, Netherlands
Flight Forum 240, 5657 DH Eindhoven, Netherlands
Wetering 14, 6002 SM Weert, Netherlands
Velperweg 157, 6824 MB Arnhem, Netherlands
Van Hilststraat 7, 5145 RK Waalwijk, Netherlands
Grevelingenweg 3, 3313 LB Dordrecht, Netherlands
Van Hilststraat 7, 5145 RK Waalwijk, Netherlands
Spaarpot 6, 5667 KX Geldrop, Netherlands
Columbusstraat 20, 7825 VR Emmen, Netherlands
Glasweg 7, 4794 TB Heijningen, Netherlands
Glasweg 7, 4794 TB Heijningen, Netherlands
Glasweg 7, 4794 TB Heijningen, Netherlands
Van Hilststraat 7, 5145 RK Waalwijk Netherlands
Loswalweg 50, 3199 LG Maasvlakte Rotterdam, Netherlands
Doesburgseweg 16D, 6902 PN Zevenaar, Netherlands
Lindeboomseweg 15, 3825 AL Amersfoort, Netherlands
Lindeboomseweg 15, 3825 AL Amersfoort, Netherlands
Hornweg 67 1044 AN Amsterdam, Netherlands
Hornweg 69, 1044 AN Amsterdam, Netherlands
Hornweg 71, 1044 AN Amsterdam, Netherlands
Lindeboomseweg 15, 3825 AL Amersfoort, Netherlands
Lindeboomseweg 15, 3825 AL Amersfoort, Netherlands
Vlasweg 12, 4782 PW Moerdijk, Netherlands
Kajuitweg 1, 1041 AP Amsterdam, Netherlands
Flight Forum 240, 5657 DH Eindhoven, Netherlands
Flight Forum 240, 5657 DH Eindhoven, Netherlands
Lindeboomseweg 15, 3825 AL Amersfoort, Netherlands
Rijksweg-Zuid 91, 4715 TA Rucphen, Netherlands
Lindeboomseweg 15, 3825 AL Amersfoort, Netherlands
Flight Forum 240, 5657 DH Eindhoven, Netherlands
Siciliëweg 38, 1045 AS Amsterdam, Netherlands
Velperweg 157, 6824 MB Arnhem, Netherlands
Siciliëweg 38, 1045 AS Amsterdam, Netherlands
Flight Forum 240, 5657 DH Eindhoven, Netherlands
Flight Forum 240, 5657 DH Eindhoven, Netherlands
Ockhuizenweg 5-A, 5691 PJ Son, Netherlands
Verwerking Bedrijfsafvalstoffen Maasvlakte (V.B.M.) C.V.
Loswalweg 50, 3199 LG Maasvlakte Rotterdam, Netherlands
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 239
SECTION 8. Other notes CONTINUED
8.1 SUBSIDIARY UNDERTAKINGS AND INVESTMENTS AT 31 MARCH 2023 CONTINUED
Subsidiary
Incorporated in Belgium
EcoSmart NV
Enviro+ NV
Maltha Glasrecyclage Belgie BV (67%)
Mineralz ES Treatment NV
Ocean Combustion Services NV
Recydel SA (80%)
Renewi Belgium NV
Renewi Chemical Services NV
Renewi Logistics NV
Renewi NV
Renewi Shared services Center SA
Renewi Tisselt NV
Renewi Valorisation & Quarry NV
Renewi Wood Products NV
Incorporated in Germany
Address of the registered office
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
Fabrieksstraat 114, 3920, Lommel, Belgium
Gerard Mercatorstraat 8, Lommel, Belgium
Baeckelmansstraat 125, 2830 Tisselt, Belgium
Rue Wérihet 72, 4020 Liège, Belgium
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
Berkebossenlaan 7, 2400 Mol, Belgium
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
Baeckelmansstraat 125, 2830 Tisselt, Belgium
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
Gerard Mercatorstraat 8, 3920, Lommel, Belgium
ATM Entsorgung Deutschland GmbH (Year end 31 December)
Kaldenkirchener Strasse 25, 41063, Mönchengladbach, Germany
Coolrec Deutschland GmbH i.L. (In liquidation, year end 31 December)
Stadtweide 17, 46446 Emmerich am Rhein, Germany
Incorporated in France
Coolrec France SAS (90%)
Maltha Glass Recycling France SAS (67%)
Incorporated in Portugal
Maltha Glass Recycling Portugal Lda (67%)
Incorporated in the UK
Renewi European Holdings Limited
Renewi Holdings Limited*
Renewi PFI Investments Limited*
Renewi SRF Trading Limited
Renewi UK Services Limited
Safewaste Limited
Subsidiary undertakings holding UK PPP contracts
Renewi Argyll & Bute Limited
Renewi Argyll & Bute Holdings Limited*
Renewi Cumbria Limited
Renewi Cumbria Holdings Limited
Renewi BDR Holdings Limited
Renewi BDR Limited
Rue Iéna Parcelle 36, 59810 Lesquin, France
Zone Industrielle, 33450 Izon, France
Parque Industrial da Gala, Lotes 26 e 27, 3081-801 Figueira da Foz, Portugal
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX ,United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX,United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
16 Charlotte Square, Edinburgh, EH2 4DF, United Kingdom
16 Charlotte Square, Edinburgh, EH2 4DF, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Strategic reportGovernance reportFinancial statementsOther information 240
SECTION 8. Other notes CONTINUED
8.1 SUBSIDIARY UNDERTAKINGS AND INVESTMENTS AT 31 MARCH 2023 CONTINUED
Joint ventures, associates and joint operations
At 31 March 2023 the Group through wholly owned subsidiaries had the following interests in joint venture companies, joint operations and
associates, all of which operate in the waste management sector.
Group
Holding %
Most recent
year end
Address of the registered office
Joint ventures
Incorporated in the Netherlands
Green Collective B.V.
PQA B.V.
Sqape B.V.
Incorporated in Belgium
Marpos NV
Revalim NV
Silvamo NV
Incorporated in the UK
Caird Evered Holdings Limited
Caird Evered Limited
50%
50%
50%
45%
50%
50%
50%
50%
31 December 2022
Mr E.N. van Kleffensstraat 10, 6842 CV, Arnhem, Netherlands
31 December 2022
Industrieweg 15, 5861 EK Wanssum, Netherlands
31 December 2022
Industrieweg 15, 5861 EK Wanssum, Netherlands
31 December 2022
L. Coiseaukaai 43, 8380 Dudzele, Belgium
Not applicable due to
recently incorporated
Kringloopstraat 1, 3630 Maasmechelen, Belgium
31 March 2023
Regenbeekstraat 7C, 8800 Roeselare, Belgium
Wakefield Waste Holdings Limited
50.001%
31 March 2023
Wakefield Waste PFI Holdings Limited
50.001%
31 March 2023
Wakefield Waste PFI Limited
50.001%
31 March 2023
31 December 2022
31 December 2022
Bardon Hall, Copt Oak Road, Markfield, Leicestershire, LE67 9PJ,
United Kingdom
Bardon Hall, Copt Oak Road, Markfield, Leicestershire, LE67 9PJ,
United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Enigma, Wavendon Business Park, Wavendon, Milton Keynes,
Buckinghamshire, MK17 8LX, United Kingdom
Associates
Incorporated in the Netherlands
AMP B.V.
RetourMatras B.V.
Tankterminal Sluiskil B.V.
Zavin B.V.
Zavin C.V.
Incorporated in Belgium
SUEZ PCB Decontamination NV
Valorem SA
Incorporated in Austria
Group
Holding %
Most recent
year end
Address of the registered office
33%
31.63%
40%
33%
33%
23%
30%
31 December 2022
Victoriberg 18, 2211 DH Noordwijkerhout, Netherlands
31 December 2022
Goudseweg 181 Unit E, 2411HK, Bodegraven, Netherlands
31 December 2022
Oostkade 7, 4541 HH Sluiskil, Netherlands
31 December 2022
Baanhoekweg 42, 3313 LA Dordrecht, Netherlands
31 December 2022
Baanhoekweg 46, 3313 LA Dordrecht, Netherlands
31 December 2022
Westvaartdijk 97, 1850 Grimbergen, Belgium
31 December 2022
Rue des trois Burettes 65 1435 Mon-Saint-Guibert, Belgium
EARN Elektroalgeräte Service GmbH
33%
31 December 2022
Johannesgasse 15, 1010 Wien, Austria
Incorporated in the UK
ELWA Limited
ELWA Holdings Limited
20%
20%
31 March 2023
31 March 2023
8 White Oak Square, London Road, Swanley, Kent, BR8 7AG
United Kingdom
8 White Oak Square, London Road, Swanley, Kent, BR8 7AG
United Kingdom
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 241
SECTION 8. Other notes CONTINUED
8.1 SUBSIDIARY UNDERTAKINGS AND INVESTMENTS AT 31 MARCH 2023 CONTINUED
Joint operations
Incorporated in the Netherlands
Airport Services by Renewi & Seenons V.O.F.
Hydrovac V.O.F.
Induserve V.O.F.
Octopus V.O.F.
Smink Boskalis Dolman V.O.F.
Group
Holding %
Most recent
year end
Address of the registered office
50%
50%
33%
50%
50%
Not applicable due to
recently incorporated
Flight Forum 240, 5657 DH Eindhoven, Netherlands
31 December 2022
Graafsebaan 67, 5248 JT Rosmalen, Netherlands
31 December 2022
Flight Forum 240, 5657 DH Eindhoven, Netherlands
31 December 2022
Forellenweg 24, 4941 SJ Raamsdonksveer, Netherlands
31 December 2022
Lindeboomseweg 15, 3825 AL Amersfoort, Netherlands
8.2 RELATED PARTY TRANSACTIONS
Transactions between the Group and its associates and joint ventures
The Group had the following transactions on arm’s length terms and outstanding balances with associates and joint ventures, in the ordinary
course of business:
Sales
Purchases
Management fees
Receivables at 31 March
Payables at 31 March
Dividends paid to the Group
Loans made by Group companies at 31 March
Loans made to Group companies at 31 March
ASSOCIATES
JOINT VENTURES
2023
€m
49.4
5.0
0.7
4.0
0.4
0.5
0.7
–
2022
€m
51.5
4.4
0.8
5.0
0.2
0.8
0.7
–
2023
€m
23.5
3.9
0.4
3.2
0.3
0.1
0.3
0.6
2022
€m
20.1
2.4
0.4
2.5
0.4
0.5
0.2
0.6
The receivables and payables are due one month after the date of the invoice and are unsecured in nature and bear no interest.
Remuneration of key management personnel
Key management personnel comprises the Board of Directors and the members of the Group’s Executive Committee. The disclosures required
by the Companies Act 2006 and those specified by the Financial Conduct Authority relating to Directors’ remuneration (including retirement
benefits and incentive plans), interests in shares, share options and other interests, are set out in the Directors’ Remuneration Report on pages
140 to 157, and form part of these consolidated financial statements. The emoluments paid or payable to key management personnel were:
Short-term employee benefits
Post-employment benefits
Share-based payments
2023
€m
6.3
0.3
1.0
7.6
2022
€m
6.3
0.2
1.1
7.6
8.3 ALTERNATIVE PERFORMANCE MEASURES (APMs) AND RECONCILIATIONS
In accordance with the Guidelines on APMs issued by the European Securities and Markets Authority, additional information is provided on the
APMs used by the Group below. The Directors use APMs as they believe these measures provide additional useful information on the
underlying trends, performance and position of the Group. These measures are used for internal performance analysis. These terms are not
defined terms under IFRS and may therefore not be comparable with similarly titled measures used by other companies. These measures are
not intended to be a substitute for, or superior to, IFRS measurements. There have been no changes in approach.
Strategic reportGovernance reportFinancial statementsOther information
242
SECTION 8. Other notes CONTINUED
8.3 ALTERNATIVE PERFORMANCE MEASURES (APMs) AND RECONCILIATIONS CONTINUED
Financial Measure
Underlying EBIT
How we define it
Operating profit excluding non-trading and exceptional items which are defined in note
3.3
Underlying EBIT margin Underlying EBIT as a percentage of revenue
Underlying EBITDA
Underlying EBITDA
margin
Underlying profit
before tax
Underlying EPS
Underlying effective
tax rate
Return on
operating assets
Underlying EBIT before depreciation, amortisation and impairment of property, plant
and equipment, right-of-use assets, intangible assets and investments, profit or loss on
disposal of property, plant and equipment, intangible assets and subsidiaries
Underlying EBITDA as a percentage of revenue
Profit before tax excluding non-trading and exceptional items
Earnings per share excluding non-trading and exceptional items
The effective tax rate on underlying profit before tax
Last 12 months underlying EBIT divided by a 13-month average of net assets excluding
core net debt, IFRS 16 lease liabilities, derivatives, tax balances, goodwill and acquisition
related intangibles
Post-tax return on
capital employed
Growth capital
expenditure
Last 12 months underlying EBIT as adjusted by the Group effective tax rate divided by
a 13-month average of net assets excluding core net debt, IFRS 16 lease liabilities and
derivatives
Growth capital projects which include the innovation portfolio and other large strategic
investments
Adjusted free cash flow Net cash generated from operating activities including interest, tax and replacement
capital spend and excluding cash flows from non-trading and exceptional items,
Covid-19 tax deferral payments, settlement of historic ATM soil liabilities and cash flows
relating to the UK PPP contracts. Payments to fund defined benefit pension schemes
are also excluded as these schemes are now closed to both new members and ongoing
accrual and as such relate to historic liabilities. The Municipal contract cash flows are
excluded because they principally relate to onerous contracts as reported in exceptional
charges in the past and caused by adverse market conditions not identified at the
inception of the contract
Net cash generated from operating activities principally excluding non-trading and
exceptional items and including interest, tax and replacement capital spend
The ratio of free cash flow to underlying EBIT
Renewi 2.0 and other exceptional cash flows are presented in cash flows from operating
activities and are included in the categories in note 3.3, net of opening and closing
Balance Sheet positions
Total cash flow is the movement in net debt excluding loan fee capitalisation and
amortisation, exchange movements, settlement of cross-currency interest rate swaps,
movement in PPP cash and PPP non-recourse debt, additions to IFRS 16 lease liabilities
and lease liabilities acquired through a business combination
Core cash excludes cash and cash equivalents relating to UK PPP contracts
Free cash flow
Free cash flow
conversion
Non-trading and
exceptional cash
flow items
Total cash flow
Core cash
Core net debt
Core net debt includes core cash excludes debt relating to the UK PPP contracts and
lease liabilities as a result of IFRS 16
Liquidity
Net debt to EBITDA/
leverage ratio
Liquidity headroom includes core cash and undrawn committed amounts on the
multicurrency green finance facility and the European Investment Bank facility.
This is the key covenant of the Group’s banking facilities which is calculated following an
agreed methodology to protect the Group from potential volatility caused by accounting
standard changes, sudden movements in exchange rates and exceptional items. Net
debt and EBITDA are measured on a frozen GAAP basis with the main impact of this
being the exclusion of IFRS 16 Lease Liabilities. Exceptional items are excluded from
EBITDA and cash and debt relating to UK PPP contracts is excluded from net debt. Net
debt and EBITDA are translated to Euros using average exchange rates for the period.
Covenant ratios are measured quarterly on a rolling 12-month basis at March, June,
September and December
Why we use it
Provides insight into profit generation and is
the measure used by management to make
decisions as it provides consistency and
comparability of the ongoing performance
between periods
Provides insight into margin development
and trends
Measure of earnings and cash generation to
assess operational performance
Provides insight into margin development
and trends
Facilitates underlying performance evaluation
Facilitates underlying performance evaluation
Provides a more comparable basis to analyse
the tax rate
Provides a measure of the return on assets
across the Divisions and the Group excluding
goodwill and acquisition related intangible
balances
Provides a measure of the Group return on
assets taking into account the goodwill and
acquisition related intangible balances
Provides an understanding of how cash is being
spent to grow the business
Measure of cash generation in the underlying
business available to fund growth capital
projects and invest in acquisition. We classify
our capital spend into general replacement
expenditure and growth capital projects which
include the innovation portfolio and other large
strategic investments
Measure of cash available after regular
replacement capital expenditure and historic
liabilities to pay dividends, fund growth capital
projects and invest in acquisitions
Provides an understanding of how profits
convert into cash
Provides useful information on non-trading and
exceptional cash flow spend
Provides an understanding of total cash flow of
the Group
The cash relating to UK PPP contracts is not
freely available to the Group and is excluded
from financial covenant calculations of the
main multicurrency green finance facility
therefore excluding this gives a suitable
measure of cash for the Group
The borrowings relating to the UK PPP
contracts are non-recourse to the Group and
excluding these gives a suitable measure of
indebtedness for the Group and IFRS 16 lease
liabilities are excluded as financial covenants
on the main multicurrency green finance facility
remain on a frozen GAAP basis
Provides an understanding of available
headroom to the Group
Commonly used measure of financial leverage
and consistent with covenant definition
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 SECTION 8. Other notes CONTINUED
8.3 ALTERNATIVE PERFORMANCE MEASURES (APMs) AND RECONCILIATIONS CONTINUED
Reconciliations of non-IFRS measures are set out below:
Reconciliation of operating profit (loss) to underlying EBITDA
2023
Operating profit (loss)
Non-trading and exceptional items (excluding finance items)
Underlying EBIT
Depreciation and impairment of property, plant and equipment
and right-of-use assets
Amortisation of intangible assets (excluding acquisition
intangibles)
Impairment of investment in associate
Non-exceptional gain on disposal of property, plant and
equipment, intangible assets and subsidiaries
Underlying EBITDA
2022
Operating profit (loss)
Non-trading and exceptional items (excluding finance items)
Underlying EBIT
Depreciation and impairment of property, plant and equipment
and right-of-use assets
Amortisation and impairment of intangible assets (excluding
acquisition intangibles)
Impairment of investment in associate
Non-exceptional (gain) loss on disposal of property, plant and
equipment and intangible assets
Underlying EBITDA
Calculation of return on operating assets
Netherlands
Commercial
Waste
€m
Belgium
Commercial
Waste
€m
Mineralz &
Water
€m
Specialities
€m
Group central
services
€m
69.4
7.5
76.9
57.1
0.9
–
(1.9)
133.0
65.3
(12.9)
52.4
31.2
–
–
(0.2)
83.4
1.0
(0.5)
0.5
17.0
0.9
–
(0.1)
18.3
(3.0)
20.1
17.1
7.8
0.2
0.9
(0.8)
25.2
(11.3)
(2.7)
(14.0)
6.2
3.5
–
–
(4.3)
Netherlands
Commercial
Waste
€m
Belgium
Commercial
Waste
€m
Mineralz &
Water
€m
Specialities
€m
Group central
services
€m
89.1
4.0
93.1
56.2
0.9
–
(1.3)
148.9
40.4
2.2
42.6
34.2
–
–
0.7
77.5
8.7
(2.9)
5.8
16.0
0.6
–
–
22.4
3.2
0.9
4.1
8.1
0.6
1.9
(0.2)
14.5
(17.4)
5.4
(12.0)
5.7
5.6
–
–
(0.7)
2023
Underlying EBIT
13 month average of operating assets
Return on operating assets
2022
Underlying EBIT
13 month average of operating assets
Return on operating assets
Netherlands
Commercial
Waste
€m
Belgium
Commercial
Waste
€m
Mineralz &
Water
€m
Specialities
excluding
UK Municipal
€m
76.9
398.2
19.3%
93.1
355.3
26.2%
52.4
110.8
47.3%
42.6
92.3
0.5
64.4
0.8%
5.8
51.8
15.9
44.9
35.4%
11.3
39.3
46.2%
11.3%
28.9%
243
Total
€m
121.4
11.5
132.9
119.3
5.5
0.9
(3.0)
255.6
Total
€m
124.0
9.6
133.6
120.2
7.7
1.9
(0.8)
262.6
Group
€m
132.9
360.0
36.9%
133.6
313.6
42.6%
Strategic reportGovernance reportFinancial statementsOther information 244
SECTION 8. Other notes CONTINUED
Calculation of post-tax return on capital employed
Operating profit
Non-trading and exceptional items in operating profit
Underlying EBIT
Tax at effective rate (2023: 27.1%, 2022: 25.0%)
Post tax underlying EBIT
13 month average of capital employed
Post -tax return on capital employed
Reconciliation of statutory profit before tax to underlying profit before tax
Statutory profit before tax
Non-trading and exceptional items in operating profit
Non-trading and exceptional finance net income
Underlying profit before tax
Reconciliation of free cash flow and adjusted free cash flow as presented in the CFO’s financial review
Net cash generated from operating activities
Exclude non-trading and exceptional provisions and working capital
Exclude payments to fund defined benefit pension schemes
Include finance charges and loan fees paid
Include finance income received
Include repayment of obligations under lease liabilities
Include purchases of replacement items of intangible assets
Include purchases of replacement items of property, plant and equipment
Include proceeds from disposals of property, plant and equipment
Included capital received in respect of PPP financial assets net of outflows
Include repayment of UK Municipal contracts PPP debt
Include movement in UK Municipal contracts PPP cash
Free cash flow
Exclude deferred Covid taxes paid
Exclude offtake of ATM soil
Exclude UK Municipal contracts
Adjusted free cash flow
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of Preparation.
2023
€m
121.4
11.5
132.9
(36.0)
96.9
2022
€m
124.0
9.6
133.6
(33.4)
100.2
915.3
860.6
10.6%
11.6%
2023
€m
93.1
11.5
(0.9)
103.7
2023
€m
188.4
4.4
3.5
(31.3)
10.6
(47.5)
(9.9)
(84.2)
6.8
6.0
(8.1)
1.1
39.8
19.7
1.2
12.2
72.9
2022
€m
95.7
9.6
(0.1)
105.2
Restated*
2022
€m
179.7
11.0
3.6
(28.4)
9.9
(43.5)
(8.4)
(64.5)
4.7
5.7
(5.7)
(3.6)
60.5
10.6
10.3
9.9
91.3
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 245
SECTION 8. Other notes CONTINUED
8.3 ALTERNATIVE PERFORMANCE MEASURES (APMs) AND RECONCILIATIONS CONTINUED
Reconciliation of net capital spend in the CFO’s financial review to purchases and disposal proceeds of property, plant and equipment
and intangible assets within Investing activities in the consolidated Statement of Cash Flows
Purchases of intangible assets
Purchases of replacement property, plant and equipment
Proceeds from disposals of property, plant and equipment
Net replacement capital expenditure
Growth capital expenditure
Total capital spend as shown in the cash flow in the CFO’s financial review
Purchases of intangible assets
Purchases of property, plant and equipment (replacement and growth)
Proceeds from disposals of property, plant and equipment
Purchases and disposal proceeds of property, plant and equipment and intangible assets within Investing activities
in the consolidated Statement of Cash Flows
2023
€m
(9.9)
(84.2)
6.8
(87.3)
(30.8)
(118.1)
2023
€m
(9.9)
(115.0)
6.8
(118.1)
2022
€m
(8.4)
(64.5)
4.7
(68.2)
(13.1)
(81.3)
2022
€m
(8.4)
(77.6)
4.7
(81.3)
Reconciliation of property, plant and equipment additions to replacement capital expenditure as presented in the CFO’s financial review
Property, plant and equipment additions (note 4.2)
Intangible asset additions (note 4.1)
Proceeds from disposals of property, plant and equipment
Movement in capital creditors (included in trade and other payables)
Growth capital expenditure – as disclosed in the CFO’s financial review
Government grants received in a prior period transferred to property, plant and equipment
Replacement capital expenditure per the CFO’s financial review
Reconciliation of total cash flow as presented in the CFO’s financial review to the movement in total net debt
Total cash flow
Additions to lease liabilities net of cancelled lease liabilities
Lease liabilities acquired through a business combination
Repayment of obligations under lease liabilities
Movement in PPP non-recourse debt
Movement in PPP cash and cash equivalents
Capitalisation of loan fees net of amortisation
Exchange movements
Settlement of cross-currency interest rate swaps
Movement in total net debt (note 5.1)
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
2023
€m
(117.9)
(8.7)
6.8
1.7
30.8
–
(87.3)
2023
€m
(64.9)
(52.0)
(30.7)
47.5
8.1
(1.1)
(0.7)
2.6
–
(91.2)
2022
€m
(73.3)
(9.3)
4.7
(1.9)
13.1
(1.5)
(68.2)
Restated*
2022
€m
29.4
(25.6)
–
43.5
5.7
3.6
(0.3)
0.8
6.4
63.5
Strategic reportGovernance reportFinancial statementsOther information 246
SECTION 8. Other notes CONTINUED
8.3 ALTERNATIVE PERFORMANCE MEASURES (APMs) AND RECONCILIATIONS CONTINUED
Reconciliation of total cash flow as presented in the CFO’s financial review to the movement in cash
Total cash flow
Proceeds from retail bonds
Repayments of retail bonds
Proceeds from bank borrowings
Repayment of bank borrowings
Bank loan acquired through business combination
Movement in PPP cash and cash equivalents
Exchange movements
Settlement of cross-currency interest rate swaps
Movement in total cash
Reconciliation of total net debt to net debt under covenant definition
Total net debt
Exclude PPP non-recourse debt
Exclude PPP cash and cash equivalents
Exclude IFRS 16 lease liabilities
Net debt aligned with covenant definition
2023
€m
(64.9)
–
(100.0)
565.0
(405.6)
7.0
(1.1)
(1.3)
–
(0.9)
2023
€m
(685.7)
88.3
(19.0)
245.8
(370.6)
2022
€m
29.4
125.0
–
141.6
(312.2)
–
3.6
1.0
6.4
(5.2)
Restated*
2022
€m
(594.5)
100.2
(21.1)
212.4
(303.0)
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
8.4 CONTINGENT LIABILITIES
Since 2017 ATM faces challenges in the offtake of thermally treated soil. This resulted in a criminal investigation, which was initiated in 2019
and closed in April 2022 without any prosecution. It is noted, however, that there are discussions ongoing on the application of thermally
cleaned soil in certain areas in the Netherlands and it cannot be ruled out that this could result in liability for damages resulting from
third-party claims in the future.
All sites need to operate in alignment with the related permits and when new regulatory requirements come into force, the Group may need to
undertake additional expenditure to align to new standards. No account is taken of any potential changes until the new obligations are fully
defined and enforceable. At one of the landfill sites in Belgium there is a risk that when a new permit is issued during the next 12 months, there
could be a change in relation to the water treatment requirements as a result of new landfill regulations expected to be approved during 2023.
We consider the most likely impact to be additional costs of up to €3m however the maximum exposure could be €14m. Due to the uncertainty
of the outcome, these costs have not been included within the landfill provision and are therefore considered to be a contingent liability.
Due to the nature of the industry in which the business operates, from time to time the Group is made aware of claims or litigation arising in
the ordinary course of the Group’s business. Provision is made for the Directors’ best estimate of all known claims and all such legal actions in
progress. The Group takes legal advice as to the likelihood of success of claims and actions and no provision is made where the Directors
consider, based on that advice, that the action is unlikely to succeed or a sufficiently reliable estimate of the potential obligation cannot be
made. None of these other matters are expected to have a material impact.
Under the terms of sale agreements, the Group has given a number of indemnities and warranties relating to businesses sold in prior periods.
Different warranty periods are in existence and it is assumed that these will expire within 15 years. Based on management’s assessment of the
most likely outcome appropriate warranty provisions are held.
In respect of contractual liabilities the Group and its subsidiaries have given guarantees and entered into counter indemnities of bonds and
guarantees given on their behalf by sureties and banks totalling €229.2m (2022: €226.0m).
Notes to the financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 247
Consolidated five year financial summary
Consolidated Income Statement
Revenue from continuing operations#
Underlying EBIT from continuing operations#
Finance charges – interest
Finance charges – other
Share of results from associates and joint ventures
Profit from continuing operations before non-trading and exceptional items
and tax (underlying profit)
Non-trading and exceptional items
Profit (loss) before tax from continuing operations
Taxation
Exceptional tax and tax on exceptional items
Profit (loss) after tax from continuing operations
Loss after tax from discontinued operations
Profit (loss) for the year
Profit (loss) attributable to:
Owners of the parent
Non-controlling interests
Consolidated Balance Sheet
Non-current assets
Other assets less liabilities
Total net debt
Net assets
Equity attributable to owners of the parent
Share capital and share premium
Exchange reserve and retained earnings
Non-controlling interests
Total equity
Financial ratios
Underlying earnings per share – continuing operations (cents per share)
Basic earnings (loss) per share – continuing operations (cents per share)
Dividend per share (pence per share)
2023
€m
Restated*
2022
€m
Restated*
2021
€m
2020
€m
2019
€m
1,892.3
1,869.2
1,693.6
1,775.4
1,780.7
132.9
(19.9)
(9.3)
–
103.7
(10.6)
93.1
(28.1)
1.6
66.6
–
66.6
62.9
3.7
66.6
1,686.2
(653.2)
(685.7)
347.3
573.9
(236.7)
337.2
10.1
347.3
90c
79c
–
133.6
(19.2)
(9.7)
0.5
105.2
(9.5)
95.7
(26.4)
6.1
75.4
–
75.4
74.5
0.9
75.4
73.0
(19.3)
(7.9)
1.6
47.4
(36.5)
10.9
(11.6)
6.2
5.5
–
5.5
5.6
(0.1)
5.5
87.6
(23.4)
(11.0)
0.9
54.1
(113.5)
(59.4)
(13.3)
12.2
(60.5)
(16.6)
(77.1)
(77.9)
0.8
(77.1)
85.5
(13.3)
(10.1)
0.4
62.5
(151.5)
(89.0)
(15.6)
28.0
(76.6)
(21.1)
(97.7)
(92.8)
(4.9)
(97.7)
1,565.9
1,612.3
1,625.8
1,439.6
(629.5)
(594.5)
341.9
573.3
(238.4)
334.9
7.0
341.9
98c
93c
–
(713.0)
(658.0)
241.3
573.1
(337.9)
235.2
6.1
241.3
45c
7c
–
(631.6)
(758.9)
235.3
573.1
(339.2)
233.9
1.4
235.3
51c
(77)c
4.5p
(472.7)
(647.4)
319.5
573.1
(254.6)
318.5
1.0
319.5
59c
(90)c
14.5p
# Revenue and underlying EBIT from continuing operations are stated before non-trading and exceptional items as set out in note 3.3.
*The comparatives have been restated due to a prior year adjustment as explained in section 1 Basis of preparation.
Strategic reportGovernance reportFinancial statementsOther information
248
Parent company Balance Sheet
As at 31 March 2023
Assets
Non-current assets
Intangible assets
Property, plant and equipment
Investments
Defined benefit pension scheme surplus
Other receivables
Deferred tax assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total assets
Liabilities
Non-current liabilities
Borrowings
Provisions
Defined benefit pension scheme deficit
Current liabilities
Borrowings
Trade and other payables
Current tax payable
Provisions
Total liabilities
Net assets
Equity
Share capital
Share premium
Retained earnings*
Total equity
31 March
2023
£m
31 March
2022
£m
Note
6
7
8
15
9
10
9
11
12
14
15
12
13
14
16
16
0.1
0.1
525.8
–
113.9
8.8
648.7
256.0
17.3
273.3
922.0
0.2
0.2
525.8
7.3
363.4
7.0
903.9
6.5
8.3
14.8
918.7
(175.4)
(168.3)
(1.1)
(3.7)
(1.1)
–
(180.2)
(169.4)
–
(8.3)
(1.7)
(0.7)
(10.7)
(190.9)
731.1
80.2
401.8
249.1
731.1
(84.5)
(10.2)
–
(0.8)
(95.5)
(264.9)
653.8
80.0
401.6
172.2
653.8
*As permitted by section 408 of the Companies Act, the Company has elected not to present its own Income Statement or Statement of Comprehensive Income. The Company reported a
profit for the year ended 31 March 2023 of £90.6m (2022: £9.1m).
The notes on pages 251 to 259 are an integral part of these financial statements.
These Financial Statements were approved by the Board of Directors and authorised for issue on 25 May 2023. They were signed on its behalf by:
Ben Verwaayen
Chairman
Annemieke den Otter
Chief Financial Officer
Renewi plcAnnual Report and Accounts 2023
Parent company Statement of Changes in Equity
For the year ended 31 March 2023
249
Balance at 1 April 2022
Profit for the year
Other comprehensive (loss) income:
Actuarial loss on defined benefit pension scheme
Tax in respect of other comprehensive income items
Total comprehensive income for the year
Transactions with owners in their capacity as owners:
Share-based compensation
Movement in tax arising on share-based compensation
Proceeds from exercise of employee options
Own shares purchased by the Employee Share Trust
Balance at 31 March 2023
Balance at 1 April 2021
Profit for the year
Other comprehensive income (loss):
Actuarial gain on defined benefit pension scheme
Tax in respect of other comprehensive income items
Total comprehensive income for the year
Transactions with owners in their capacity as owners:
Share-based compensation
Movement in tax arising on share-based compensation
Proceeds from exercise of employee options
Own shares purchased by the Employee Share Trust
Balance at 31 March 2022
Note
Share
capital
£m
80.0
Share
premium
£m
401.6
Retained
earnings
£m
172.2
90.6
(14.3)
3.6
79.9
2.3
(0.8)
–
(4.5)
Total
equity
£m
653.8
90.6
(14.3)
3.6
79.9
2.3
(0.8)
0.4
(4.5)
–
–
–
–
–
–
0.2
–
–
–
–
–
–
–
0.2
–
80.2
401.8
249.1
731.1
80.0
401.4
–
–
–
–
–
–
–
–
80.0
–
–
–
–
–
–
0.2
–
401.6
155.4
9.1
7.7
(1.7)
15.1
2.1
1.1
–
(1.5)
172.2
636.8
9.1
7.7
(1.7)
15.1
2.1
1.1
0.2
(1.5)
653.8
15
3
16
16
15
3
16
16
Strategic reportGovernance reportFinancial statementsOther information 250
Parent company Statement of Cash Flows
For the year ended 31 March 2023
Profit before tax
Finance income
Finance charges
Operating profit
Amortisation of intangible assets
Dividend income
Net decrease in provisions
Payment related to committed funding of the defined benefit pension scheme
Share-based compensation
Exchange (loss) gain
Operating cash flows before movement in working capital
Decrease (increase) in receivables
Increase in payables
Cash flows from operating activities
Income tax received
Net cash inflow (outflow) from operating activities
Investing activities
Dividend received in cash
Finance income
Net cash inflow from investing activities
Financing activities
Proceeds from share issues
Finance charges and loan fees paid
Proceeds from retail bonds
Repayment of retail bonds
Proceeds from bank borrowings
Repayment of bank borrowings
Investment in own shares by the Employee Share Trust
Net cash (outflow) inflow from financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
2023
£m
92.9
(20.6)
8.0
80.3
0.1
(77.2)
(0.1)
(3.1)
2.3
(5.4)
(3.1)
16.2
0.4
13.5
0.5
14.0
77.2
17.8
95.0
0.4
(9.4)
–
(86.5)
2.2
(2.2)
(4.5)
(100.0)
9.0
8.3
17.3
2022
£m
7.0
(18.5)
9.6
(1.9)
0.1
(3.5)
(1.6)
(3.1)
2.1
0.6
(7.3)
(109.7)
0.1
(116.9)
0.6
(116.3)
2.2
16.8
19.0
0.2
(8.8)
106.9
–
2.6
(2.6)
(1.5)
96.8
(0.5)
8.8
8.3
Renewi plcAnnual Report and Accounts 2023 251
Notes to the parent company financial statements
1. Accounting policies – Company
GENERAL INFORMATION
Renewi plc is a public limited company listed on the London Stock Exchange with a secondary listing on Euronext Amsterdam. Renewi plc is
incorporated and domiciled in Scotland under the Companies Act 2006, registered number SC077438. The address of the registered office is
given on page 265. The nature of the Company’s principal activity is a head office corporate function.
The financial statements for Renewi plc the Company are presented in Sterling being the functional currency of the entity and are rounded to
the nearest £0.1m unless otherwise stated.
BASIS OF PREPARATION
The separate financial statements of the Company are presented in compliance with the requirements for companies whose shares are listed
on the London Stock Exchange. They have been prepared on the historical cost basis, except for share-based payments, which are stated at
fair value. The policies set out below have been consistently applied. The Company has applied all accounting standards and interpretations
issued relevant to its operations and effective for accounting periods beginning on 1 April 2022. The financial statements are prepared in
accordance with UK adopted international accounting standards in conformity with the requirements of the Companies Act 2006.
GOING CONCERN
Having assessed the principal risks and other matters in connection with the viability statement, the Directors consider it appropriate
to continue to adopt the going concern basis of accounting in preparing these financial statements.
NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED
Standards and interpretations issued by the International Accounting Standards Board (IASB) are only applicable if endorsed by the
UK Endorsement Board (UKEB). There were no new standards, amendments to standards or interpretations not yet effective that would be
expected to have a material impact on the Company.
INTANGIBLE ASSETS
Computer software is capitalised on the basis of the costs incurred to purchase and bring the assets into use. These costs are amortised over
the estimated useful life ranging from one to five years on a straight-line basis.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, except for freehold land, is stated at cost less accumulated depreciation and provision for impairment. Cost
includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use.
Freehold land is not depreciated. The asset’s residual values and useful lives are reviewed and adjusted if appropriate at the end of each
reporting period.
Depreciation is provided to write off the cost of fixtures and fittings (less the expected residual value) on a straight-line basis over an expected
useful life of up to 10 years.
Assets are reviewed for impairment whenever events or circumstances indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount
is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their
present value. An impairment loss is recognised immediately as an operating expense and at each subsequent reporting date the impairment
is reviewed for possible reversal.
INVESTMENTS IN SUBSIDIARY UNDERTAKINGS
Investments in subsidiary undertakings are stated at cost less any provision for impairment in value. Investments are reviewed for impairment
whenever events or circumstances indicate that the carrying amount may not be recoverable. An impairment provision is recognised for the
amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of fair value less costs to sell
and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value.
PROVISIONS
Provisions are recognised where there is a present legal or constructive obligation as a result of a past event and it is probable that an outflow
of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of
the obligation.
Strategic reportGovernance reportFinancial statementsOther information 252
Notes to the parent company financial statements CONTINUED
1. Accounting policies – Company CONTINUED
EMPLOYEE BENEFITS
Retirement benefits
The Company accounts for pensions and similar benefits under IAS 19 (revised) Employee Benefits. For defined benefit plans, obligations are
measured at discounted present value whilst plan assets are recorded at fair value. The operating and financing costs of the plans are recognised
separately in the Income Statement. Interest is calculated by applying the discount rate to the net defined pension liability. Actuarial gains and
losses are recognised in full through the Statement of Comprehensive Income; surpluses are recognised only to the extent that they are
recoverable. Movements in irrecoverable surpluses are recognised immediately in the Statement of Comprehensive Income. Payments to defined
contribution schemes are charged to the Income Statement as they become due.
Share-based payments
The Company issues equity-settled share-based awards to certain employees. The fair value of share-based awards is determined at the date
of grant and expensed on a straight-line basis over the vesting period with a corresponding increase in equity based on the Company’s
estimate of the shares that will eventually vest. At each balance sheet date, the Company revises its estimates of the number of awards that are
expected to vest based on service and non-market performance conditions. The amount expensed is adjusted over the vesting period for
changes in the estimate of the number of shares that will eventually vest, except for changes resulting from any market-related performance
conditions.
TAXATION
Current tax
Current tax is based on taxable profit or loss for the year. Taxable profit differs from profit before tax in the Income Statement because
it excludes items of income or expense that are taxable or deductible in other years or that are never taxable or deductible. The asset
or liability for current tax is calculated using tax rates that have been enacted, or substantively enacted, at the balance sheet date.
Deferred tax
Deferred tax is recognised in full where the carrying value of assets and liabilities in the financial statements is different to the corresponding
tax bases used in the computation of taxable profits. Deferred tax liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is probable that the taxable profits will be available against which deductible temporary
differences can be utilised. Deferred tax is calculated at the tax rates that have been substantively enacted at the balance sheet date. Deferred
tax is charged or credited in the Income Statement, except where it relates to items charged or credited directly to equity in which case the
deferred tax is also dealt with in equity.
FOREIGN CURRENCIES
The functional currency of the Company is Sterling. Monetary assets and liabilities denominated in foreign currencies at the year end are
translated at the period end exchange rates. Income and expenses denominated in foreign currencies are translated into sterling at the
average rate of exchange for the month in which they occur. Foreign currency gains or losses are credited or charged in the Income Statement.
FINANCIAL INSTRUMENTS
Amounts owed by subsidiary undertakings
Amounts owed by subsidiary undertakings are initially recognised at fair value and subsequently measured at amortised cost using
the effective interest method less any provision for impairment losses. The Company measures impairment losses using the general expected
credit loss model taking into account objective evidence of impairment as a result of assessing the estimated future cash flows of the financial
asset.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with a maturity of three months or less and is held at amortised cost.
External borrowings
Retail bonds and bank loans are recorded at the proceeds received, net of direct issue costs. Finance charges, including premiums payable on
settlement or redemption and direct issue costs, are accounted for on an accruals basis in the Income Statement using the effective interest
rate method.
Trade payables
Trade payables are not interest bearing and are stated initially at fair value and subsequently held at amortised cost.
Amounts owed to subsidiary undertakings
Amounts owed to subsidiary undertakings are initially recognised at fair value and subsequently held at amortised cost.
Other receivables and other payables
Other receivables and other payables are initially recognised at fair value and subsequently measured at amortised cost.
Renewi plcAnnual Report and Accounts 2023 253
1. Accounting policies – Company CONTINUED
CALLED UP SHARE CAPITAL
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or share options are shown
in equity as a deduction, net of tax, from the proceeds. The share premium account represents any excess of the net proceeds over the
nominal value of any shares issued.
DIVIDENDS
Dividend distributions to the equity holders are recognised in the period in which they are approved by the shareholders in general meeting.
Interim dividends are recognised when paid.
2. Key accounting judgements and estimates
The preparation of financial statements in accordance with IFRS requires management to make judgements, estimates and assumptions that
affect the application of policies and reported amounts of assets and liabilities, income and expenditure. The areas involving a higher degree
of judgement or complexity are set out below and in more detail in the related note.
DEFINED BENEFIT PENSION SCHEME
The Company operates a defined benefit scheme in the UK for which an actuarial valuation is carried out as determined by the trustees at
intervals of not more than three years. The pension cost under IAS 19 (revised) Employee Benefits is assessed in accordance with
management’s best estimates using the advice of an independent qualified actuary and assumptions in the latest actuarial valuation. In
relation to the prior year surplus, based on actuarial professional advice management concluded that the pension scheme rules determine
that upon winding up the scheme the Company has an unconditional right to a refund once all the liabilities have been discharged and that
the trustees of the scheme do not have the unilateral right to wind up the scheme, therefore any asset is not restricted and no additional
liability is recognised. The principal assumptions in connection with the retirement benefit scheme are set out in note 7.2 of the Group
financial statements.
IMPAIRMENT OF INVESTMENTS IN SUBSIDIARY UNDERTAKINGS AND AMOUNTS OWED BY SUBSIDIARY
UNDERTAKINGS
Investments in subsidiary undertakings and amounts owed by subsidiary undertakings are reviewed for impairment whenever events or
circumstances indicate that the carrying value may not be recoverable. The carrying value is estimated based on projected cash flows which
may be long term in nature as detailed in note 8.
3. Employees
Staff costs
Wages and salaries
Social security costs
Share-based benefits
Other pension costs
Total staff costs
2023
£m
4.2
0.3
2.3
–
6.8
2022
£m
4.1
0.4
2.1
0.1
6.7
The average number of people (including executive directors) employed by the Company was 18 employees (2022: 18).
See pages 140 to 157 of the Directors’ Remuneration report for details of the remuneration of executive and non-executive Directors and their
interest in shares and options of the Company. Further details on share-based payments are set out in note 7.3 of the Group financial
statements.
Strategic reportGovernance reportFinancial statementsOther information
254
Notes to the parent company financial statements CONTINUED
4. Auditors’ remuneration
The auditors’ remuneration for audit services to the Company was £0.1m (2022: £0.1m) and the fees paid to BDO LLP and its associates for
non-audit services for audit related assurance services for the Company were £15,000 (2022: £35,000).
5. Dividends
The Directors have not recommended a final dividend for the year ended March 2023 (2022: nil).
6. Intangible assets
Cost
At 1 April 2021, 31 March 2022 and 31 March 2023
Accumulated amortisation and impairment
At 1 April 2021
Amortisation charge
At 31 March 2022
Amortisation charge
At 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 31 March 2021
7. Property, plant and equipment
Cost
At 1 April 2021 and 31 March 2022
Disposal
At 31 March 2023
Accumulated depreciation and impairment
At 1 April 2021 and 31 March 2022
Disposal
At 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 31 March 2021
Computer
Software
£m
0.5
0.2
0.1
0.3
0.1
0.4
0.1
0.2
0.3
Total
£m
0.3
(0.2)
0.1
0.1
(0.1)
–
0.1
0.2
0.2
Land
£m
Fixtures and
fittings
£m
0.1
–
0.1
–
–
–
0.1
0.1
0.1
0.2
(0.2)
–
0.1
(0.1)
–
–
0.1
0.1
Renewi plcAnnual Report and Accounts 2023
8. Investments
At 1 April 2021
Additions
At 31 March 2022 and 31 March 2023
255
Investments
in subsidiary
undertakings
£m
524.5
1.3
525.8
During the prior year the Company made a further investment of £1.3m in an existing subsidiary.
In the opinion of the Directors, the value of investments in subsidiary undertakings is not less than the aggregate amount of £525.8m (2022:
£525.8m). This assessment is based on the value in use calculated with reference to the discounted cash flow forecasts for each of the
reporting segments of the Group as set out in note 4.1 of the Group financial statements. The Group performs sensitivity analysis of the
impairment testing by considering reasonably possible changes in the key assumptions used. The results of sensitivities performed
demonstrated significant headroom and it is concluded that no reasonably possible change to the assumptions would result in an impairment
charge.
9. Trade and other receivables
Non-current assets
Amounts owed by subsidiary undertakings
Current assets
Amounts owed by subsidiary undertakings
Other receivables
Prepayments
The carrying amounts of trade and other receivables are denominated in the following currencies:
Sterling
Euro
2023
£m
2022
£m
113.9
363.4
254.5
0.2
1.3
256.0
2023
£m
19.7
350.2
369.9
4.1
0.4
2.0
6.5
2022
£m
33.6
336.3
369.9
During the year an expected credit loss allowance of £nil (2022: £2.0m) was charged to the Income Statement in relation to loans owed
by subsidiary undertakings in the UK Municipal business determined by calculating the net present value of the future cash flows available to
repay the loan. The Directors do not consider there to be any significant increases in credit risk in relation to the remaining receivables.
Interest on amounts owed by subsidiary undertakings is received at rates of between 0% and 14% (2022: 0% and 14%), the balances are unsecured
and repayable either on demand or in accordance with the loan agreements with a final repayment date of 30 September 2039.
Strategic reportGovernance reportFinancial statementsOther information
256
10. Deferred tax asset
Deferred tax is provided in full on temporary differences under the liability method using the applicable tax rate.
At 1 April 2021
(Charge) credit to Income Statement
(Charge) credit to equity
At 31 March 2022
(Charge) credit to Income Statement
Credit (charge) to equity
At 31 March 2023
Retirement
benefit
scheme
£m
Other
timing
differences
£m
Tax losses
£m
0.6
(0.7)
(1.7)
(1.8)
(0.9)
3.6
0.9
5.0
2.3
–
7.3
(0.6)
–
6.7
0.5
(0.1)
1.1
1.5
0.5
(0.8)
1.2
Total
£m
6.1
1.5
(0.6)
7.0
(1.0)
2.8
8.8
The majority of the £8.8m (2022: £7.0m) deferred tax asset is expected to be recovered after more than one year.
As at 31 March 2023, the Company has unused tax losses (tax effect) of £6.7m (2022: £7.3m) available for offset against future profits. A deferred
tax asset has been recognised in respect of £6.7m (2022: £7.3m) of such losses and recognition is based on management’s projections of future
profits in the Company. Tax losses may be carried forward indefinitely.
11. Cash and cash equivalents
The carrying amount of cash and cash equivalents of £17.3m (2022: £8.3m) was denominated in sterling.
12. Borrowings
Non-current borrowings
Retail bonds
Current borrowings
Retail bonds
2023
£m
2022
£m
175.4
168.3
–
84.5
At 31 March 2023 the Group had two issues of green retail bonds. The bonds of £65.8m (€75m) (2022: £63.1m (€75m)) maturing in July 2024
have an annual gross coupon of 3.00% and the bonds of £109.6m (€125m) (2022: £105.2m (€125m)) maturing in July 2027 have an annual gross
coupon of 3.00%. On 16 June 2022 the £86.5m (€100m) green retail bonds with an annual gross coupon of 3.65% were repaid on maturity. The
retail bonds are unsecured and have cross guarantees from members of the Group. Further details are given in the Group financial statements
in note 5.8.
Of the non-current borrowings of £175.4m (2022: £168.3m), £65.8m (2022: £nil) is due to be repaid between one and two years, £109.6m
(2022: £63.1m) is due to be repaid between two and five years and £nil (2022: £105.2m) is due to be repaid after five years. The carrying
amounts of borrowings are denominated in Euros.
Notes to the parent company financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023
13. Trade and other payables
Trade payables
Other tax and social security payable
Accruals and other payables
Amounts owed to Group undertakings
The carrying amounts of trade and other payables are denominated in the following currencies:
Sterling
Euro
Amounts owed to Group undertakings are interest free, unsecured and repayable upon demand.
14. Provisions
At 1 April 2022
Utilised in the year
At 31 March 2023
2023
£m
0.4
0.4
6.8
0.7
8.3
2023
£m
3.8
4.5
8.3
257
2022
£m
0.2
0.4
9.5
0.1
10.2
2022
£m
3.7
6.5
10.2
£m
1.9
(0.1)
1.8
Of the £1.8m (2022: £1.9m) provisions £0.7m is current (2022: £0.8m) and £1.1m is non-current (2022: £1.1m). Provisions principally include
warranties, whereby under the terms of the agreements for the disposal of certain businesses, the Company has given warranties to the
purchasers which may give rise to payments. The Company has the liability until the end of the contractual terms in the agreements.
15. Retirement benefit scheme
The Company’s defined benefit pension scheme (called the Shanks Group Pension Scheme) covers eligible UK employees and is closed to
new entrants and closed for future benefit accrual. The plan provides benefits to members in the form of a guaranteed level of pension
payable for life and the level of benefits provided depends on the members’ length of service and salary. The total estimated contributions
expected to be paid to the scheme in the year ending 31 March 2024 are £3.1m. Further details are provided in note 7.2 of the Group financial
statements.
Strategic reportGovernance reportFinancial statementsOther information
258
16. Share capital and share premium
At the Annual General Meeting of Renewi plc held on 15 July 2021, shareholders approved the consolidation of the Company’s share capital on
the basis of one new ordinary share with a nominal value of £1.00 each for every ten existing ordinary shares of 10 pence each held. This was
subsequently completed on 19 July 2021 when the issued share capital of 800,236,740 10 pence shares were replaced with 80,023,674 £1
shares.
Share capital allotted, called up and fully paid
At 1 April 2021 (ordinary shares of 10p each)
Issued under share option schemes – prior to share consolidation (ordinary shares of 10p each)
Ordinary shares of 10p each held on 19 July prior to the consolidation
Adjustment to number of shares following the share consolidation
Issued under share option schemes (ordinary shares of £1 each)
At 31 March 2022 (ordinary shares of £1 each)
Issued under share option schemes (ordinary shares of £1 each)
At 31 March 2023 (ordinary shares of £1 each)
SHARE CAPITAL –
ORDINARY SHARES
SHARE
PREMIUM
Number
800,141,536
95,204
800,236,740
(720,213,066)
36,263
80,059,937
190,358
80,250,295
£m
80.0
–
80.0
–
–
80.0
0.2
80.2
£m
401.4
–
401.4
–
0.2
401.6
0.2
401.8
During the year 190,358 (2022: 36.263) ordinary shares of £1 were allotted. These new shares resulted from the exercise of share options under
the Savings Related Share Option Schemes for an aggregated consideration of £0.4m (2022: £0.2m). Further disclosures relating to share-
based options are set out in note 7.3 of the Group financial statements.
Renewi plc Employee Share Trust
The Renewi plc Employee Share Trust owns 853,223 (1.1%) (2022: 552,851 (0.7%)) £1 shares of the issued share capital of the Company in trust for
the benefit of employees of the Group. The Trust waives its dividend entitlement. Retained earnings include ordinary shares held by the Trust to
satisfy future share awards which are recorded at cost. During the year 400,597 (2022: 34,580 ) £1 shares were transferred to individuals under the
LTIP and DAB schemes and in the prior year 798,433 10 pence shares were transferred to individuals under the LTIP and DAB schemes prior to the
share consolidation. During the year 700,969 (2022: 237,000) £1 shares) were purchased by the Trust at a cost of £4.5m (2022: £1.5m).
17. Financial instruments
The carrying value of the Company’s financial assets and financial liabilities is shown below:
Financial assets
Trade and other receivables excluding prepayments
Cash and cash equivalents
Financial liabilities
Retail bonds
Trade and other payables excluding non-financial liabilities
Note
9
11
12
13
2023
£m
368.6
17.3
385.9
175.4
7.9
183.3
2022
£m
367.9
8.3
376.2
252.8
9.8
262.6
The fair value of financial assets and financial liabilities is not materially different to their carrying value except for the retail bonds which have
a fair value of £172.7m (2022: £253.6m).
Notes to the parent company financial statements CONTINUEDRenewi plcAnnual Report and Accounts 2023 259
17. Financial instruments CONTINUED
The following table analyses the Company’s financial liabilities into relevant maturity groupings. The maturities of the undiscounted cash
flows, including interest and principal, at the balance sheet date are based on the earliest date on which the Company is obliged to pay.
At 31 March 2023
Retail bonds
Trade and other payables
At 31 March 2022
Retail bonds
Trade and other payables
18. Contingent liabilities
Within
one year
£m
Between one
and five years
£m
Over five
years
£m
5.3
4.2
9.5
92.7
3.8
96.5
191.0
–
191.0
79.8
–
79.8
–
–
–
108.7
–
108.7
Total
£m
196.3
4.2
200.5
281.2
3.8
285.0
In addition to the contingent liabilities as referred to in note 8.4 of the Group financial statements, the Company has given guarantees in
respect of the Group’s subsidiary undertakings’ borrowing facilities totalling £224.6m (2022: £74.8m). The Company also has contingent
liabilities in respect of both VAT and HM Revenue & Customs group payment arrangements of £0.7m (2022: £1.6m).
19. Related party transactions
A list of the Company’s subsidiaries is set out in note 8.1 of the Group financial statements. Transactions with subsidiaries relate to interest on
intercompany loans, management charges and dividends. Net interest income was £19.9m (2022: £18.6m), management charges were £5.2m
(2022: £5.4m) and dividends received were £77.2m (2022: £3.5m). Total outstanding balances are listed in notes 9 and 13.
Strategic reportGovernance reportFinancial statementsOther information
OTHER
INFORMATION
Secondary material
Black granulate from small domestic
appliances, typically reused in
electronics and car interiors
262
Shareholder
information
As at 31 March 2023
Holders
%
Shares held
Private shareholders
Corporate shareholders
1444
422
77.38
22.62
733,765
79,516,530
99.09
Total
1866
100.00
80,250,295
100.00
Size of shareholding
Holders
%
Shares held
%
0.91
FINANCIAL CALENDAR
13 July 2023
Annual General Meeting
November 2023
Announcement of interim results
31 March 2024
2024 financial year end
May 2024
Announcement of 2024 results
1 - 5,000
5,001 - 25,000
25,001 - 50,000
50,001 - 100,000
100,001 - 250,000
250,001 - 500,000
over 500,000
Total
1586
102
45
33
36
20
44
84.99
5.47
2.41
1.77
1.93
1.07
2.36
855,566
1,239,297
1,596,528
2,383,877
5,929,981
7,275,262
%
1.07
1.54
1.99
2.97
7.39
9.07
For updates to the calendar during the year, please visit the
Company website: renewi.com.
SHAREGIFT
If shareholders have only a small number of shares, the value
of which makes it uneconomical to sell, they may wish to
consider donating them to the charity ShareGift (UK registered
charity no. 1052686).
60,969,784
75.97
1,866
100.00
80,250,295 100.00
Further information may be obtained from its website at sharegift.org
or by calling +44 (0)20 7930 3737.
REGISTRAR SERVICES
Administrative enquiries concerning shareholdings in the Company
made via the London Stock Exchange should be directed to the
Registrar, Computershare Investor Services plc, The Pavilions,
Bridgwater Road, Bristol BS99 6ZZ.
Computershare can also be contacted by telephone on +44 (0)370
707 1290. Shareholders can manage their holding online by
registering at investorcentre.co.uk.
Queries in relation to shareholdings through Euronext should
be directed to Renewi’s Euronext Listing and Paying Agent,
ABN AMRO Bank N.V. who can be contacted at as.exchange.
agency@nl.abnamro.com.
WEBSITE
Shareholders are encouraged to visit our website, which has a wealth
of information about Renewi.
There is a section designed specifically for investors. It includes
detailed coverage of the Renewi share price, annual results,
performance charts, financial news and investor relations’ videos.
This Annual Report can also be viewed on our website, together with
many other reports, at renewi.com.
DIVIDENDS
Shareholders are strongly encouraged to receive their cash dividends
by direct transfer as this ensures dividends are credited promptly
and efficiently. Shareholders who do not currently have their
dividends paid directly to a bank or building society account, and
who wish to do so, should complete a mandate form obtainable
from Computershare. Overseas shareholders wishing to receive their
dividend payment in local currency can now do so using
Computershare’s Global Payments Service.
ELECTRONIC SHAREHOLDER COMMUNICATION
Shareholders may elect to receive future shareholder documents
and information by email or via the Company’s website. This is
intended to help the environment by reducing paper and transport
as well as reducing administrative costs including printing and
postage. Please contact the Company Registrar for details.
SHARE FRAUD WARNING
Fraudsters use persuasive and high-pressure tactics to lure investors
into scams. They may offer to sell shares that turn out to be
worthless or non-existent, or to buy shares at an inflated price in
return for an upfront payment. While high profits are promised, if you
buy or sell shares in this way you will probably lose your money.
HOW TO AVOID FRAUD
Firms authorised by the Financial Conduct Authority (FCA) in the UK
will rarely contact you out of the blue with an offer to buy or sell your
shares. If you feel that the person contacting you is not legitimate,
note their name and the firm they work for. You can check the
Financial Services Register at fca.org.uk to see if the person and firm
is authorised by the FCA. If the firm does not have contact details on
the register or they are out of date, call the FCA on 0800 111 6768
(from the UK) or +44 20 7066 1000 (from abroad). You can search the
list of unauthorised firms to avoid at fca.org.uk/scams. If you buy or
sell shares from an unauthorised firm, you will not have access to the
Financial Ombudsman or Financial Services Compensation Scheme.
You should always consider getting independent financial advice
before any transaction.
REPORT A SCAM
If you are approached by a fraudster, please tell the FCA using the
share fraud reporting form at fca.org.uk/scams, where you can find
out more about investment scams, or call the FCA Consumer
Helpline. If you have already paid money to share fraudsters, you
should contact Action Fraud on +44 (0)300 123 2040.
Renewi plcAnnual Report and Accounts 2023 263
Non-financial
statement
FRAMEWORK OF DISCLOSURE
AROUND AVOIDED EMISSIONS
Context:
At the end of March 2023, the World Business Council for Sustainable
Development (WBCSD) and its member companies, in collaboration
with Carbone4 and its Net Zero Initiative have released the Guidance
on Avoided Emissions: Helping business drive innovations and scale
solutions toward Net Zero.
Source: wbcsd.org/Imperatives/Climate-Action/Resources/Guidance-
on-Avoided-Emissions
Purpose of this disclosure
Renewi does recognise the importance of first reporting on its total
carbon footprint and on communicating progresses on its carbon
reduction goals to meet the Paris Agreement on climate change (see
our chapter ‘Reduce our carbon emissions’).
Through its recycling activities and services, Renewi does contribute
to the global carbon mitigation by not only reducing its own and
value chain GHG emissions, but also does contribute to the
acceleration of global decarbonisation efforts by delivering
additional solutions enabling others to reduce emissions as well. The
communication of Renewi does include a combination of Renewi’s
recycling rate and total enabled carbon avoidance. (see our chapter
Enable the circular economy). Avoided emissions provide a broader
picture to support the promotion and scaling of solutions needed to
achieve net-zero.
Disclosure
Renewi uses the suggested framework from the guidance document
to provide transparency on its compliance with the above mentioned
guidelines.
Description of the contribution
Renewi does report avoided emissions from the recycling and
sale of recyclates, secondary raw materials, waste derived fuels,
renewable electricity and low carbon footprint biogas and finally
sorting/incineration of residual waste toward energy recovery by
third parties.
assurance of our sustainability data. We have started with limited
assurance for our scope 1&2 carbon footprint, and will continue to
increase the scope of external assurance going forward
Renewi passes Gate 1.
Gate 2 (Climate Science Alignment)
• Renewi does confirm that the solution (see our contribution above)
has mitigation potential according to the latest climate science
and recognised sources
• By reviewing the list of claimed interventions with an identified link
to mitigation options from IPCC AR6 Working Group III summary for
Policymakers, we confirm that our solutions are listed with the
following recognised mitigation potential:
Solution
Recognised mitigation potential
Second-hand products
Industry: enhanced recycling
Production of secondary materials
(e.g., plastics, glass,
aluminium, steel)
Circular material flows (e.g., enhanced
recycling)
Production of biogas/biomethane from
sources like animal manure, organic
waste or landfills
Reduce CH4 and N2O emissions in
agriculture
Biofuel from organic food waste
Transport: Biofuels
A solution requiring a lower bake
temperature
Energy efficiency in industry
• Our solutions are not directly applied to activities involving
exploration, extraction, mining and/or production, distribution and
sales of fossil fuels i.e., oil, natural gas and coal
Renewi passes Gate 2.
Gate 3 (Contribution Legitimacy)
• Renewi’s solutions have a direct and significant decarbonising
impact by providing low carbon footprint raw materials and
products on the market. By consuming our products, our
customers lower down their carbon footprint scope 1, 2 and 3
(when solutions are energy sources) and their carbon footprint
scope 3 (when solutions are secondary raw materials)
Acknowledgments
We comply with the three eligibility gates
Renewi passes Gate 3.
Gate 1 (Climate Action Credibility)
• Renewi has committed to set near-term science based targets this
year. Renewi has communicated this year its GHG reduction
ambitions set for its scope 1, 2 and 3 by end 2030 (FY31). These
targets were developed by using the expertise of an environmental
consulting agency and by using as well the latest SBTi
recommendations and tools. Renewi will follow up this year in
getting these goals approved by SBTi
• Since this year, Renewi does report its scope 1, 2 and 3 and will
continue doing so every year through its Annual report and CDP
Disclosure (Climate Change questionnaire)
• Additionally, we have set out on a journey towards external
Strategic reportGovernance reportFinancial statementsOther information 264
Non-financial statement CONTINUED
In summary, after assessing its solutions against the three
eligibility gates, Renewi does confirm that its identified solutions
have all passed the 3 eligibility gates and are entitled to claim
avoided emissions.
We report avoided emissions separately
from our GHG inventory
Our total carbon footprint is disclosed in our chapter Reduce our
carbon emissions. Our avoided emissions are reported in our
chapter Enable the circular economy and jointly presented next to
our recycling rate.
Renewi does report its carbon footprint scope 3 in compliance with
GHG protocol. Carbon avoidance from the availability of secondary
raw materials to customers is not taken into account in the reporting
of scope 3 GHG emissions.
We don’t claim neutrality through the use of avoided emissions
Renewi does not use the word neutrality in the communication on
the impact of its total carbon avoidance. As per the guidance
document mentioned above, Core Principle 3 is clear and followed
by Renewi.
Core Principle 3: Separate reporting of inventory and avoided
emissions.
‘‘Companies shall always separate Scope 1, 2 and 3 GHG emissions
reporting from avoided emissions in their external company
reporting and shall not use avoided emissions to offset GHG
inventory emissions. As such, avoided emissions should also be kept
separate from offsetting claims and carbon credits.’’
We assessed potential negative side-effects of our solution(s) in
terms of environmental trade-offs and sustainability goals
beyond GHG impact
We assessed potential rebound effects of our solutions
In order to identify and list limitations (potential negative side and
rebounds effects), Renewi will be starting an internal assessment and
will disclose the findings in the Annual Report FY24.
IMPACT
Renewi reports its GHG emissions avoided on a year on year at the
scale of the company.
Carbon avoidance in the supply chain
as a result of our activities
Volumes (’000 tonnes)
Materials separated for re-use/recycling
Waste-derived fuels produced and sold
Landfill gas/anaerobic digestion
electricity production
Waste-derived fuel used at ATM
R1 Incineration emissions (negative)
Total avoided emissions
FY22
2,099
767
41
200
(506)
2,602
FY23
2,061
714
24
186
(436)
2,548
Renewi plcAnnual Report and Accounts 2023 265
Company
information
Corporate Head Office
Renewi plc Corporate Head Office
Enigma
Wavendon Business Park
Wavendon, Milton Keynes
Buckinghamshire
MK17 8LX, UK
Tel: +44 (0)1908 650580
Company Secretary
company.secretary@renewi.com
Website
renewi.com
PRINCIPAL OFFICES
Renewi Commercial Waste Netherlands
Flight Forum 240
5657 DH Eindhoven
The Netherlands
Renewi Commercial Waste Belgium
Gerard Mercatorstraat 8
B-3920
Lommel, Belgium
Renewi Mineralz & Water
Vlasweg 12
4782 PW
Moerdijk
The Netherlands
Renewi Specialities
Renewi plc Corporate Head Office
Enigma
Wavendon Business Park
Wavendon, Milton Keynes
Buckinghamshire
MK17 8LX, UK
Tel: +44 (0)1908 650580
Registered Office
Renewi plc
16 Charlotte Square
Edinburgh
EH2 4DF
Registered in Scotland
No. SC077438
CORPORATE ADVISERS
Independent Auditors
BDO LLP
Principal Bankers
ING Bank N.V.
Coöperatieve Rabobank U.A.
ABN AMRO Bank N.V.
KBC Bank N.V.
BNP Paribas Fortis S.A./N.V.
HSBC Bank plc
Landesbank Baden-Wurttemberg
Financial Advisers
Greenhill & Co International LLP
Corporate Brokers
Berenberg
Peel Hunt
Euronext Listing and Paying Agent
ABN AMRO Bank N.V.
Solicitors
Ashurst LLP
Dickson Minto W.S.
Remuneration Committee Advisers
Mercer Ltd
PR Advisers
Paternoster Communications Ltd
Strategic reportGovernance reportFinancial statementsOther information SPV – Special purpose vehicle
TCFD – Task Force on Climate-related
Financial Disclosures
TGG – Thermally treated soil
TSR – Total shareholder return
VGG – Van Gansewinkel Groep B.V.
WEEE – Waste from electrical and
electronic equipment
ZEV – Zero-emission vehicle
*PPP refers to a public private partnership project in the UK
between (1) one or more local authorities and (2) a special
purpose vehicle owned either solely by Renewi or together
with joint venture partners and financed with project
finance debt, under which Renewi, as operator, performs
some of the waste management functions of the relevant
local authorities. These include, where appropriate, those
projects that also benefit from central government private
finance initiative (PFI) credits.
266
Glossary
ABS – Acrylonitrile butadiene styrene
ATM – Afvalstoffen Terminal Moerdijk, a
brand in our Mineralz & Water Division
BDR – Barnsley, Doncaster and Rotherham
Benelux – The economic union of Belgium,
the Netherlands and Luxembourg
Bio-LNG – Bio-liquefied natural gas
C&D – Construction and Demolition
CDP – Carbon Disclosure Project
CFS – A brand in our Mineralz &
Water Division
CO2 e – Carbon dioxide equivalent
Core net debt – Borrowings less cash from
core facilities excluding PPP non-recourse
net debt and lease liabilities as a result of
IFRS 16
DAB – Deferred annual bonus
EBIT – Earnings before interest and tax
EBITDA – Earnings before interest, tax,
depreciation and amortisation
ELWA – East London Waste Authority
EPS – Earnings per share
ESG – Environmental, social and governance
FCA – Financial Conduct Authority
GHG protocol – Greenhouse Gas protocol
HIT – Hazards, incidents or threats
I&C – Industrial and commercial
ICT – Information and communications
technology
IFRS – International Financial
Reporting Standards
IL&T – Human Environment and
Transport Inspectorate
IPCC – Intergovernmental Panel on
Climate Change
ISRS – International Sustainability
Rating System
KPI – Key performance indicator
LLP – Limited liability partnerships
LTI – Lost time injuries
LTIP – Long-Term Incentive Plan
M&A – Mergers and acquisitions
MBT – Mechanical biological treatment
PFAS – Per- and polyfluoroalkyl substances
PFI – Private finance initiative
PPP – Public private partnership*
RCF – Revolving credit facility
ROA – Return on operating assets
ROCE – Return on capital employed
SDGs – UN Sustainable
Development Goals
SHE – Safety, health and environment
SHEQ – Safety, health, environment
and quality
Renewi plcAnnual Report and Accounts 2023 We are
Renewi
We are a waste-to-product company
and a leader in sustainability, operating
at the heart of the circular economy. As
pure-play recyclers, our core purpose is
to give new life to used materials.
Every day we help our customers
progress towards their net-zero emission
goals. We do this by creating secondary
materials with a lower carbon footprint
than the primary resources they replace.
We help our customers help the planet.
What we do matters
The world has realised the transition to
clean energy alone is not enough to
meet the climate challenges we face.
Circular economies, through resource
preservation and reduced reliance on
incineration and landfill, play a vital role
in slowing climate change.
Building on a legacy of more than
100 years, the work we do at Renewi
brings us one step closer to a cleaner,
more sustainable world.
Designed and produced by Wardour wardour.co.uk.
Printed by DG3 Newnorth on Revive Silk, a 100% recycled paper which is FSC® certified. Revive Silk is the
recipient of certificates and awards associated with its raw materials procurement and manufacture.
Revive Silk is also a fully carbon-balanced paper product, and fulfils essential compliance and due diligence
requirements for supply chain analysis, as well as social and environmental product risk assessments.
DG3 Newnorth is FSC® and PEFC certified. Its environmental management system is accredited to ISO 14001
and its procedures are accredited to ISO 9001.
Please see details on page 262 on how to receive electronic copies of future documentation from Renewi plc.
Cover image: Plastic recyclate. Photography: Thomas van Shaik. Styling: Eddy Frings.
Secondary materials photography by Thomas van Schaik, styling by Eddy Frings. Employee photography by
Twycer and Tom Doms. Site photography by Epsilon Studios and Exstatic.
Putting secondary
materials first
Renewi plc Annual Report and Accounts 2023
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Renewi plc Enigma, Wavendon Business Park, Ortensia Drive, Wavendon, Milton Keynes, Buckinghamshire, England MK17 8LX