WMI makes rapid gains

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WASTE Management International, the UK-quoted arm of the US environmental services group, yesterday reported a 49 per cent increase in pre-tax profits for the year to December.

Edwin Falkman, WMI's chief executive, said the company was still 'benefiting from acquisitions made earlier in the year and continued internal growth'.

Profits rose from pounds 96.3m to pounds 143.7m on sales 35 per cent higher at pounds 817m. Earnings per share were up 30 per cent at 23.3p and, as expected, there was no dividend.

Philip Morrish, an analyst at Smith New Court, estimated volume growth to have been about 10 per cent, with 5 per cent coming from price rises and the remaining 20 per cent from acquisitions. WMI made 25 acquisitions during the year, including first moves into France and Finland.

WMI, which is 80 per cent- owned by its Chicago-based parent, was floated on the London stock market last April at 595p with a valuation of pounds 2.2bn. Yesterday the shares added 27p to 762p.

On size grounds alone, the company would easily qualify for membership of the FT-SE 100, but it would only become eligible for inclusion once 25 per cent of its shares were freely held. Waste Management Inc is thought to be unwilling to dilute its holding.

Fourth-quarter earnings per share jumped 20 per cent to 6.5p. Pre-tax profits were pounds 40.9m, a 36 per cent rise, from sales of pounds 224m, a 37 per cent improvement.

WMI continued its rapid growth through acquisitions and joint ventures. A deal was signed with SAE-Fougerolle, the French construction group, to build a solid-waste treatment plant in France, and yesterday the company agreed to build a treatment plant in Java in partnership with the Indonesian government.