Malcolm Wood, chairman, said sales and operating profits in April and May were noticeably ahead of last year's.
This trend was most significant in the south of England, where lower volumes of waste had depressed profits last year.
Turnover in the core environmental business fell 4 per cent to pounds 93.7m, but operating profits declined 8 per cent to pounds 12.4m.
Mr Wood said that market share had held up and attributed the lower operating results to losses on the delayed commissioning of new tyre recycling, clinical incineration and wet air oxidation plants.
Profits were hit further by a reduced contribution from Leigh's coal extraction and processing interests and an increase in debt charges.
Mr Wood said the rise in interest payments from pounds 2.9m to pounds 4.3m reflected the group's capital investment in a national network of waste collection, disposal and treatment facilities.
Charles Lambert, at Smith New Court, said the increased capacity left the company well geared to recovery and forecast profits of pounds 12m this year.
Earnings per share fell by a third to 10.3p, but the total dividend is maintained at 7.83p. The shares rose 5p to 206p.Reuse content