Envipco posts 13% revenue growth with margins under pressure

Dutch recycling technology provider Envipco reported a 13% increase in revenue for the first half of 2024, driven by higher volumes across its core markets in Europe and North America.

The company, which specializes in the collection and processing of beverage containers, said total sales reached €128.4 million ($138.5 million) in the six months to June 30, up from €113.6 million a year earlier. Volume growth in key regions offset softer pricing in some segments, the company stated.

Despite the revenue increase, Envipco’s operating margins contracted to 8.2% from 9.7% in the same period of 2023, reflecting higher operational costs, including energy and labor expenses. The company attributed the margin pressure to inflationary pressures in Europe and supply chain bottlenecks in North America.

Envipco maintained its full-year guidance, reaffirming a revenue target of €250 million to €260 million and an operating margin of 8% to 9%. Chief Executive Officer Ton van Keken said the company remains focused on cost discipline and efficiency improvements to mitigate margin headwinds.

Shares in Envipco were little changed in early trading, with the stock down 0.3% at €2.25 in Amsterdam on Wednesday.

The company has been expanding its automated sorting capabilities in response to stricter recycling regulations in the EU and U.S., though capital expenditures have weighed on near-term profitability. Envipco plans to open a new facility in Poland later this year to support growth in Central and Eastern Europe.