Bingo not interested in SKM Recycling scraps as stock tumbles

Bingo Industries chief Daniel Tartak says he is not interested in bidding for the stricken SKM Recycling business in Victoria.

Bingo Industries CEO Daniel Tartak. Picture: Getty Images

Bingo Industries chief executive Daniel Tartak says he is not interested in bidding for the stricken SKM Recycling business in Victoria, describing the kerbside recycling collection market as being in for a “world of hurt” for at least the next year.

SKM has collapsed owing $100 million to creditors and is now in the hands of receivers KordaMentha. Mr Tartak ruled out Bingo investigating a bid for the business or a move into the Victorian domestic residential recycling collection market, saying: “We are not interested in SKM, it is not what we do.”

Mr Tartak also declared 2020 would be “transformational” for Bingo, vowing to pursue more ­opportunities collecting and processing waste from big civil construction and infrastructure projects.

The Bingo boss said that sector of the market offered far more ­potential for his company than the apartment and residential construction industry, a slowdown in which caused Bingo to issue a profit warning in February when it announced its half-year profits and sent its share price plunging.

Bingo’s full-year result yesterday was also not welcomed with enthusiasm by the market, which pushed Mr Tartak’s company down 6 per cent to $2.24.

While it knocked $15 million off the value of the shareholding of Mr Tartak and his family, including his Bingo founder father and member of The List — Australia’s Richest 250, Tony Tartak, and about $10m from non-executive Ian Malouf’s stake, Mr Tartak said of the share price: “It’s the one thing we don’t have control over.”

Bingo Industries’ $577m acquisition of Mr Malouf’s Dial-a-Dump Industries in March helped the waste management business record group underlying EBITDA of $106.1m, it said yesterday.

The result, which Bingo said was in line with previous market guidance, was up 13.2 per cent from 2018 and included a $13.6m contribution from DADI, which Bingo completed its deal for in March.

Mr Tartak said Bingo would phase out the DADI brand over the next two years — he said Mr Malouf agreed with the move and that “Ian wears an orange [Bingo] shirt now” — but stressed that the acquisition was transformational for Bingo.

“We always said last year was going to be a year of transition and that 2020 would be a transformational year for Bingo. So we will focus on delivering on that promise and I’m quietly confident about the year ahead,” he said.

Mr Tartak said the apartment market was still soft and he did not forecast it recovering for Bingo in the short term. “We don’t think it is getting any worse, and is probably stabilising now,” he said.

But he said Bingo would aggressively look for new contracts in the civil building and infrastructure sector. “We’ve been in the market now for about five years, but we still have a small market share. So we see plenty of opportunities to take some of that market share and think we can achieve a lot of organic growth.”

Underlying net profit was $58.9m, up 22.2 per cent from the previous year, while revenue rose 32.4 per cent to $402.2m. But Bingo’s contribution to the result was roughly the same as last year.

Bingo expected its underlying EBITDA margin, which fell 4.4 per cent to 26.4 per cent, to recover. Statutory net profit fell 41.1 per cent to $22.3m, though the result came after $18.9m transaction and integration costs related to the DADI transaction and $14.8m worth of stamp duty.

Bingo declared a final dividend of 2c a share, payable on December 30.