The expansion and diversification of its operations had led to record revenue growth for Australian environmental services company, CO2 Group Limited (ASX: COZ). On Monday, CO2 reported revenues of $35 million for financial year 2011 and full year net profit after tax of $1.5 million.

A year earlier, CO2 reported a $3.34 million loss.

CO2 Chief Executive Officer Andrew Grant attributed the financial turnaround to higher demand for the company's carbon forest projects and availability of more environmental and financial services.

Among the areas that CO2 expanded are its launch of the Carbon Banc, a carbon credits and renewable energy certificates trading business, and expansion of area of trees managed on behalf of its clients. From 17,900 hectares the previous year, the area covered has increased to 22,300 hectares.

C02 said the area will further expand in 2012 with its contracted planting program.

"This has been a transformational year for CO2 Group - one in which we cemented our position as the leading Australian carbon and environmental services business with a range of complementary products and services," Mr Grant said in a statement.

"Whilst the federal government's legislation on the pricing of carbon has been a pleasing development, CO2's growth has been achieved prior to the passage of the carbon pricing legislation. Our growth to date has been driven by servicing the needs of governments and blue chip organizations to assist them achieve their carbon offset strategies," he added.

Mr Grant pointed out that with more than 500 large carbon emitters in Australia seeking carbon offset strategies, CO2 is very well placed to tap a large, proven and established industry.

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