The potential to develop the business is huge due to the UAE’s annual consumption of plastic bottles
With financial backing from its state-run parent company NWMC, Horizon Technologies has made a niche for itself in a sector that is just beginning to take shape across the Middle East. Strong growth is expected in the recycling sector over the next few years. The UAE and Saudi Arabia are among some of the largest producers of plastic waste in the region.
Nevertheless, the management also recognises that the company is totally dependent on municipalities across the UAE for its raw material. This is one of the main risks to the ongoing development of its business and any future expansion plans it has.
|Horizon Technologies’ sales (AEDm)|
|Source: National Mineral Water Company|
|Horizon Technologies’ recycling plant|
|(Tonnes a month)|
|Source: Horizon Technologies|
Seeking to have some control on the quality of raw material it receives and to increase the flow of supply, Horizon has signed agreements with Dubai-based Masafi to run a recycling collection project and with Al-Ain Mineral Water Company.
The firm’s processing plant is in a good location in Fujairah, where it benefits from good logistics links to export markets in the Far East and South Asia.
However, the inadequate access to power in the emirate is a major issue, limiting the plant’s processing capabilities. Despite this, Horizon Technologies managed to ramp up production in 2009, increasing sales from AED2.8m in 2008 to AED12.4m in 2009.
Another factor that affects the company’s financial performance is the prices it has to pay local municipalities for the reclaimed bottles, which can fluctuate between $350-400 a tonne.
Yet the potential to develop the business is huge as the UAE consumes up to 70,000-80,000 tonnes a year of plastic bottles.
As the UAE and other GCC populations increase and their economies produce large volumes of plastic waste, it is clear there are opportunities for the private sector to exploit. Awareness campaigns among local individuals and companies across the UAE supported by the municipalities remain key to the growth of the recycling sector in the country and Horizon’s own financial health.
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