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WASTE CONNECTIONS REPORTS SECOND QUARTER 2019 RESULTS
AND UPDATES FULL YEAR OUTLOOK
|-||Revenue of $1.370 billion, up 10.5%|
|-||Reports 6.0% solid waste price + volume growth, exceeding high end of outlook|
|-||Net income attributable to Waste Connections of $148.8 million, or $0.56 per share|
|-||Adjusted net income attributable to Waste Connections* of $181.3 million, or $0.69 per share|
|-||Adjusted EBITDA* of $425.3 million, or 31.1% of revenue|
|-||YTD net cash provided by operating activities of $753.0 million|
|-||YTD adjusted free cash flow* of $503.9 million, or 19.3% of revenue|
|-||YTD acquired annualized revenue of approximately $160 million|
TORONTO, ONTARIO, July 29, 2019 - Waste Connections, Inc. (TSX/NYSE: WCN) (“Waste Connections” or the “Company”) today announced its results for the second quarter of 2019.
“Solid waste pricing growth of over 5%, along with a sequential 200 basis points increase in solid waste volumes, drove underlying solid waste collection, transfer and disposal margin expansion of approximately 70 basis points in the quarter. This helped offset a portion of the impact from lower than expected contributions from higher margin, commodity-related activities, primarily recycling and renewable fuels, and the dilutive margin impact of acquisitions completed since the prior year period. Our team delivered on the commitments within their control, but the ongoing erosion in recycled commodity values and a precipitous drop in renewable fuel credits impacted overall results,” said Worthing F. Jackman, President and Chief Executive Officer. “In spite of these commodity-related headwinds, we have already generated adjusted free cash flow* of more than $500 million, putting us on track to meet our original expectation for underlying adjusted free cash flow* for the full year.”
Mr. Jackman added, “As anticipated, we have already completed an outsized year of acquisition activity with almost half of the year still ahead of us, as we have closed approximately $160 million in total annualized revenue. We are particularly pleased with the approximate 65% average reduction in safety-related incidents in the three largest acquisitions completed over the last several months, and we look forward to continued improvement, as we are accelerating the timing to automate the residential fleet in our largest acquired location. In addition, new contract awards are trending above average. These wins provide foundations for further growth next year but require incremental capex in the current year, which, along with the accelerated fleet conversion referenced above, totals approximately $35 million, and will impact reported adjusted free cash flow*. The strength of our financial profile and free cash flow generation keeps us well-positioned for additional acquisitions and organic growth opportunities, while maintaining the flexibility to increase the return of capital to shareholders.”
Q2 2019 Results
Revenue in the second quarter totaled $1.370 billion, up from $1.240 billion in the year ago period. Operating income was $222.1 million; this compares to $210.7 million in the year ago period.
Net income attributable to Waste Connections in the second quarter was $148.8 million, or $0.56 per share on a diluted basis of 264.5 million shares. In the year ago period, the Company reported net income attributable to Waste Connections of $138.7 million, or $0.52 per share on a diluted basis of 264.3 million shares.
Adjusted net income attributable to Waste Connections* in the second quarter was $181.3 million, or $0.69 per share, versus $172.3 million, or $0.65 per share, in the prior year period. Adjusted EBITDA* in the second quarter was $425.3 million and 31.1% of revenue, as compared to adjusted EBITDA* of $395.5 million and 31.9% of revenue in the prior year period.
*A non-GAAP measure; see accompanying Non-GAAP Reconciliation Schedule
The following information was filed by Waste Connections, Inc. (WCN) on Monday, July 29, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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