Cleanaway Waste Management appeals levy decision

• Cleanaway Waste Management lodged an appeal against a court ruling over historical landfill levy underpayments.
• The company will take a $12.3 million for FY27.
• The dispute centres on disputed landfill levy underpayments stemming back to FY18.

Cleanaway Waste Management (ASX:CWY) announced it has lodged an appeal against a Victorian Supreme Court decision regarding an alleged $6.9 million historical landfill levy underpayment for FY18.

The dispute follows audits by the Environment Protection Authority covering subsequent financial years, which claimed additional levy underpayments of $7.2 million for FY22.

Cleanaway stated that the FY19 and FY22 audit amounts were not part of the initial Supreme Court proceedings.

To address the ongoing dispute, the business plans to recognise a $27.5 million provision to cover the relevant FY18, FY19, and FY22 levies, along with assessed court costs and accrued interest.

Cleanaway stated that the cash flow impact for FY27 is expected to be approximately $12.3 million to settle the disputed FY18 levy amount and associated costs.

Following the announcement, the Cleanaway Waste Management share price was down at $2.33.

The landfill levy dispute stems from historical operations at the company's Melbourne Regional Landfill facility.

The decision to treat the financial provision as an underlying adjustment allows the company to isolate these historical regulatory expenses from its core operational performance metrics.