Close the Loop Group faces FY25 loss, eyes recovery in FY26

AUSTRALIA – Close the Loop Group (CLG), an ASX-listed firm, reported a financial downturn for FY25, with revenue falling 6.7% to US$195.1 million compared to the previous year.

According to the company, gross profit dropped 26.1% to US$58.3 million, with the gross margin shrinking to 29.9% from 37.8%. 

Adjusted EBITDA fell 59% to US$18.4 million, and the company recorded a net loss before tax of US$20.1 million, a stark contrast to the US$14.4 million profit in FY24. 

Management attributed the decline to an unfavorable product mix in the Resource Recovery (ITAD) division, despite steady demand.

The ITAD division, which refurbishes and resells IT equipment and recycles printer cartridges through a global network of 260,000 collection points, processes about 50 million cartridges annually. 

A recent approval for CLG’s Mexicali plant under Mexico’s IMMEX program will allow the facility to recycle computer hardware, boosting capacity for FY26. 

The Packaging division, focusing on eco-friendly solutions like flexible pouches for FMCG customers, is seeing rising demand. 

The company is investing in R&D for smart packaging and expanding into health and beauty products.

CLG conducted a strategic review of underperforming units in FY25 and appointed Kesh Nair as executive director and CEO of Australia, and Matthew Zimmer as CEO of North America. 

A private equity bid for the company did not proceed, prompting a shift toward organic growth. “We are focusing on operational efficiency and global infrastructure to become a one-stop partner for OEMs in packaging and recovery,” a company spokesperson stated.

To drive recovery, CLG aims to improve cash flow through faster payments, reduced inventory, and group-wide purchasing. 

The company is also expanding its sales team and targeting markets in Australia and South Africa to strengthen its packaging brand. 

In ITAD, CLG plans to increase volumes by enhancing OEM partnerships and building a comprehensive reverse supply chain that integrates refurbishment, recycling, and logistics.

For FY26, CLG anticipates growth from new ITAD programs, higher Mexicali plant volumes, and stronger global OEM ties. 

A report by Closed Loop Partners noted that acquisitions like Agri-Cycle are scaling organic waste management, a sector complementary to CLG’s sustainability focus. 

Management expects these initiatives to expand the customer base and enhance service offerings, positioning CLG to capture greater market share in sustainable packaging and reverse logistics.

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