Oct 6, 2020, 13:00 PM
A challenging financial year, characterised by the coronavirus global health crisis and associated lockdown measures, has failed to dampen Citywide’s underlying performance, with Revenue up by 6%.
Core services, including Waste and Traffic Management, were significantly impacted by reduced customer service levels and economic and social restrictions imposed in the wake of the COVID-19 outbreak.
The rapid mobilisation of Citywide’s new coronavirus Cleansing and Sanitisation service helped offset impacts, resulting in a six per cent improvement in Revenue compared with FY19, Citywide Chief Executive Officer Chris Campbell said.
“The story this year is undoubtedly the continuing COVID-19 situation, which – through the strict lockdown measures – not only stifled core services Revenue but also created significant challenges for our Municipal customers,” Chris said.
“While we’ve yet to fully realise the extent of the economic impacts, our ability to quickly respond and mobilise our new COVID-19 cleansing services underpinned a resilience that ultimately contributed to a solid income performance.”
In the same period, a strategic and financial review of the company’s NSW business resulted in a decision to exit significant loss-making contracts amid a broader restructuring plan; collectively resulting in a non-cash impairment of $4.5m. This decisive action, although impacting profit this year, establishes a solid platform for improvement and further growth.
The company posted an underlying profit from ordinary activities (before charges and income tax) of $5.8 million and, after accounting for one-off adjustments such as the NSW goodwill impairment and a combination of restructuring charges, a Profit Before Tax of $0.2m. This solid performance supported the declaration of a dividend payable to the City of Melbourne for the FY20 year totalling $2.0m.
“In what has been a difficult market, it was a prudent and responsible decision to exit the NSW loss-making contracts, and also to restructure the size of the corporate workforce that supports the operating teams,” Chris said.
“These issues reflect the competitive economic circumstances we face, and importantly, enable a stronger platform for future growth. Despite the difficulties faced during the year, I am extremely proud of the resilience demonstrated by our people and the way they responded to the challenges we encountered”.
“The Values we share, and our Vision 2025 business strategy, reinforce our strong growth focus as we look into the future.”
Simon Mossman - Group Corporate Communications
M 0427 307 216