I agree slowdown in residential construction has an adverse...

I agree slowdown in residential construction has an adverse effect on BIN's revenue (accounts for around 25%). But positive sides as Goldman Sachs recently pointed out:

1. QLD $75 levy from 1 July 2019, we should start to see what proportion of the 1mn tonnes of waste currently being diverted to QLD landfills remains in NSW. It is our view that c.50% or more should remain in Sydney, allowing BIN to process more waste through its post collections operations. This will place upward pressure on landfill prices.

2. BIN intends to put through a significant price rise on 1 July 2019, to 1) offset the $75/tonne Queensland Waste Levy implementation; 2) allow for recovery of inflationary cost increases (3-5%) that the company did not recover in FY19; and 3) FY20E cost inflation recovery of 3-5%. We see the size and extent of this price increase as a key catalyst to determine by how much margins bounce back in FY20 following the margin squeeze in FY19.