Viridor set to see prices fall

Pennon warned that lower landfill volumes and slipping waste material prices could hurt its waste management business, wiping the gloss off a rise in its half-year profits.

The utility's Viridor, which provides recycling and waste collection services, brings in a third of total group profit. Landfill disposal volumes for the first half fell 9 per cent to 1.7 million tonnes, hurt by the shutdown of a landfill site and a weak economy.

Colin Drummond, Viridor's chief executive, said the prices at which waste paper and recovered metals are sold are likely to drop off their recent historical highs in the second half.

First-half pre-tax profits at the South West Water owner increased by 12 per cent to £107m, on revenues up 8.3 per cent at £643m.