* Viridor H1 profit seen 30.5 pct lower at 27.8 mln stg
* Expects group H1 profit up over 3 pct to 111 mln stg
* Sees Viridor FY profit somewhat below expectations
* Shares down 5.7 pct
LONDON, Nov 15 (Reuters) - Britain’s Pennon warned annual profit at its waste management business would miss analyst forecasts as a weak global economy depresses prices for waste paper and recovered metals used in recycling.
Shares in the company dropped as much as 10 percent on Thursday after it said first-half profit before tax and joint ventures at Viridor would fall 30.5 percent to 27.8 million pounds ($44 million).
Recycling revenue was expected to fall by 18.8 million pounds, it said, adding that while analysts expect a price recovery in the second half of the year, it had not seen one and now anticipated Viridor’s annual profit would be “somewhat below” the bottom of current market forecasts.
The range of analyst expectations for full-year profit before interest, tax and joint ventures at Viridor, which typically accounts for around a third of total group profit, is 54.5 million pounds to 77.3 million pounds.
However, the company said its water and sewerage business, South West Water, had continued its strong operational performance against its 2010/15 regulatory contract.
It expects the unit to post a 10 percent rise in first half pretax profit to over 83 million pounds, helping group profit for the first six months of the year up over 3 percent to 111 million pounds - ahead of an analyst consensus of 108.7 million.
At 1625 GMT, Pennon shares were down 5.7 percent at 665.5 pence.
The group said Viridor, which was seen as a key driver of growth for Pennon, had made good progress on a growing pipeline of projects that would underpin its long-term profit momentum.