Covanta discusses progress with energy-from-waste projects

By Erin Voegele | October 28, 2019

Covanta Holding Corp. released third quarter financial results on Oct. 24, reporting increased revenue, net income and adjusted EBITDA. During an earnings call the following day, Covanta officials briefly discussed progress with its U.K. energy-from-waste projects and said the company is considering the development of energy-from-waste projects in other regions.

"Our third quarter results reflect solid operations and a strong waste market, which drove favorable year-over-year performance," said Stephen Jones, president and CEO of Covanta, in a statement. "Waste processing and energy production are tracking toward record levels this year, and we continue to push waste pricing, with same store tip fees up 4 percent in the quarter. While this has been a challenging year from a commodity price perspective, we remain focused on the areas we control, and I am very proud of our continued operational performance, as well as our progress on key strategic initiatives."

During the Oct. 25 earnings call, Jones provided a brief update on Covanta’s U.K. development activities. He indicated that the 60 MW Rookery South Energy Recovery Facility and the 21.5 MW Earls Gate Energy Center projects are well into construction. Both projects are being development in partnership with The U.K. Green Investment Group. According to Jones, the Protos and Newhurst projects are nearing financial close. “Those projects are attractive and well-structured and we are actively engaged with our project partners, lenders and EPC contractors to swiftly move the projects forward,” he said, adding that the Protos project remains positioned to reach financial close this year, with the Newhurst project expected to reach financial close in early 2020.

“Further, as I mentioned in the last quarter, our partnership with GIG goes beyond these four projects and there are other earlier stage projects that are moving along as well,” Jones said. “We look forward to providing more color on these projects, as well as our efforts in other geographies, when we have reached material development steps.” Later in the call, Jones referenced a project Covanta is involved with in the Philippines and said the company is also looking at projects in China. In addition, he noted there are opportunities for new energy-from-waste projects in the U.S.

Coventa reported $81 million in energy revenue for the third quarter, flat with the same period of last year. Waste and service revenue was $353 million, up from $332 million. Recycled metals revenue fell to $19 million, down from $23 million. Other operating revenue was $12 million, down from $20 million during the third quarter of last year.

Covanta reported total operating revenue of $465 million, up from $456 million during the same period of 2018. Net income was $14 million, compared to a net loss of $27 million reported for the third quarter of last year. Adjusted EBITDA was $125 million, up from $122 million.