EXHIBIT 99.1

 

FOR IMMEDIATE RELEASE

 

 

 

Waste Management Announces Third Quarter Earnings

 

 

 

Strong Organic Revenue Growth Produced Robust Earnings and Cash Generation

 

 

 

HOUSTON — October 25, 2018 Waste Management, Inc. (NYSE: WM) today announced financial results for its quarter ended September 30, 2018. Revenues for the third quarter of 2018 were $3.82 billion, compared with $3.72 billion for the same 2017 period. Net income for the quarter was $499 million, or $1.16 per diluted share, compared with $386 million, or $0.87 per diluted share, for the third quarter of 2017.(a) On an as-adjusted basis, excluding certain items, net income was $496 million, or $1.15 per diluted share, in the third quarter of 2018, compared with $398 million, or $0.90 per diluted share, in the third quarter of 2017.(b)

 

The Company’s as-adjusted third quarter 2018 results exclude a $0.06 per diluted share benefit primarily resulting from favorable adjustments related to tax reform and changes in state tax laws and non-cash charges of $0.05 per diluted share primarily related to the impairment of a disposal asset.

 

“The recurring theme for the first two quarters of 2018 was one of historically strong solid waste performance more than overcoming a weak recycling market,” said Jim Fish, President and Chief Executive Officer of Waste Management.  “In the third quarter, we generated strong operating EBITDA growth, and we expect that growth to accelerate in the fourth quarter and into 2019.(c) Our collection and disposal business generated strong organic revenue growth of 6.4% as a result of our strengthening core price and volume.(d) Additionally, we demonstrated disciplined cost control, particularly on the SG&A line.  We executed very well on our plans to refine our recycling pricing model, and we saw tangible benefits from the investments we are making in our employees.”

 

KEY HIGHLIGHTS FOR THE THIRD QUARTER 2018

 

FOR MORE INFORMATION

 

Waste Management

 

Web site

www.wm.com

 

Analysts

Ed Egl

713.265.1656

eegl@wm.com

 

Media

Tiffiany Moehring

720.346.5372

tmoehrin@wm.com

 

 

 

 

 

Revenue Growth

 

 

 

 

·

In the third quarter, revenue growth was driven by strong yield and volume growth in the Company’s collection and disposal business, which contributed $200 million of incremental revenue.  This was partially offset by a decline in revenue from the Company’s recycling line of business, which fell by $52 million year-over-year in the third quarter of 2018.

 

·

Core price, which consists of price increases net of rollbacks and fees, excluding the Company’s fuel surcharge, was 5.4%, compared to 4.7% in the third quarter of 2017.(c)

 

·

Internal revenue growth from yield for collection and disposal operations was 2.5% for the third quarter of 2018 versus 2.0% in the third quarter of 2017.

 

·

Traditional solid waste internal revenue growth from volume was 3.2%, or 3.4% on a workday adjusted basis, in the third quarter of 2018.  Total Company internal revenue growth from volume, which includes our recycling and other ancillary businesses, was 4.2%, or 4.4% on a workday adjusted basis, in the third quarter.

 

 


 

 

Recycling

 

 

 

 

·

Average recycling commodity prices at the Company’s facilities were approximately 47% lower in the third quarter of 2018 compared to the prior year period.  Results for the Company’s recycling line of business declined by approximately $0.04 per diluted share when compared to the third quarter of 2017.  The Company continues to expect the full-year impact from recycling to be a negative $0.17 to $0.20 per diluted share.

 

 

 

 

 

Cost Management & Profitability

 

 

 

 

·

As a percentage of revenue, total Company operating expenses were 62.1% in the third quarter of 2018 compared to 61.9% in the third quarter of 2017. The increase in operating expense is primarily driven by core solid waste volume growth, acquisitions, inflationary cost pressures and investment being made in the Company’s employees.

 

·

As a percentage of revenue, SG&A expenses were 9.0% in the third quarter of 2018 compared to 9.6% in the third quarter of 2017.

 

·

Operating EBITDA was $1.08 billion for the third quarter.(d)  Adjusted operating EBITDA was $1.11 billion for the third quarter of 2018, an increase of $36 million, or 3.4%, from the third quarter of 2017.(b)

 

 

 

 

 

Free Cash Flow & Capital Allocation

 

 

 

 

·

Net cash provided by operating activities was $874 million in the third quarter of 2018, compared to $853 million in the third quarter of 2017.

 

·

Capital expenditures were $404 million in the third quarter of 2018, a $54 million increase from the third quarter of 2017.

 

·

Free cash flow was $480 million in the third quarter of 2018, compared to $509 million in the third quarter of 2017.(b)  The decrease in the current quarter free cash flow was driven by increased capital spending as the Company continues to invest in its fleet and disposal network to support growth.

 

·

The Company paid $199 million in dividends to shareholders and spent $200 million to repurchase shares in the third quarter of 2018.

 

·

The Company spent $79 million on acquisitions of traditional solid waste businesses during the third quarter of 2018.

 

 

 

 

 

Taxes

 

 

 

 

·

The Company’s effective tax rate for the third quarter of 2018 was approximately 16.6%.  Adjusting for items excluded from the Company’s as-adjusted results, the tax rate was 21.3%.(b)

 

 

 

 

UPDATED 2018 COMPANY GUIDANCE(b)

 

 

 

 

·

The Company’s adjusted earnings per share guidance range increased from $4.05 to $4.10 to $4.13 to $4.15.

 

·

The Company expects to meet or exceed analysts’ current 2018 consensus for adjusted operating EBITDA of $4.204 billion and narrows its range to $4.2 billion to $4.22 billion.

 

·

The Company expects to meet or exceed analysts’ current 2018 consensus of $1.95 billion for free cash flow and narrows its range to $1.95 billion to $2.0 billion.

 

 


 

“I’m enthusiastic about the direction of the company,” Fish said.  “We continue to deliver strong financial and operational performance, and we have promoted strong leaders to continue our high standard of operational excellence.  With the hard work our employees have demonstrated so far, I am confident that we can achieve our goals for the remainder of this year and set the stage for an even better 2019.”

 

 

 

 

 

 

 

 

 

 

 

(a)

For purposes of this press release, all references to “Net income” refer to the financial statement line item “Net income attributable to Waste Management, Inc.”

 

 

 

 

(b)

Adjusted earnings per diluted share, adjusted net income, adjusted operating EBITDA, adjusted tax rate, and free cash flow are non-GAAP measures. Please see “Non-GAAP Financial Measures” below and the reconciliations in the accompanying schedules for more information.

 

 

 

 

(c)

Management defines operating EBITDA as GAAP income from operations before depreciation and amortization; this measure may not be comparable to similarly-titled measures reported by other companies.

 

 

 

 

(d)

Core price is a performance metric used by management to evaluate the effectiveness of our pricing strategies; it is not derived from our financial statements and may not be comparable to measures presented by other companies.  Core price is based on certain historical assumptions, which may differ from actual results, to allow for comparability between reporting periods and to reveal trends in results over time.

 

 

 

 

The Company will host a conference call at 10:00 a.m. (Eastern) today to discuss the third quarter results.  Information contained within this press release will be referenced and should be considered in conjunction with the call.

 

 

 

The conference call will be webcast live from the Investor Relations section of Waste Management’s website www.wm.com. To access the conference call by telephone, please dial (877) 710-6139 approximately 10 minutes prior to the scheduled start of the call.  If you are calling from outside of the United States or Canada, please dial (706) 643-7398.  Please utilize conference ID number 6079618 when prompted by the conference call operator.

 

 

 

A replay of the conference call will be available on the Company’s website www.wm.com and by telephone from approximately 1:00 p.m. (Eastern) today through 5:00 p.m. (Eastern), on Thursday, November 15, 2018. To access the replay telephonically, please dial (855) 859-2056, or from outside of the United States or Canada dial (404) 537-3406, and use the replay conference ID number 6079618.

 

 

 

ABOUT WASTE MANAGEMENT

Waste Management, based in Houston, Texas, is the leading provider of comprehensive waste management environmental services in North America. Through its subsidiaries, the Company provides collection, transfer, disposal services, and recycling and resource recovery. It is also a leading developer, operator and owner of landfill gas-to-energy facilities in the United States. The Company’s customers include residential, commercial, industrial, and municipal customers throughout North America. To learn more information about Waste Management, visit www.wm.com or www.thinkgreen.com.

 

FORWARD-LOOKING STATEMENTS

The Company, from time to time, provides estimates of financial and other data, comments on expectations relating to future periods and makes statements of opinion, view or belief about current and future events. This press release contains a number of such forward-looking statements, including but not limited to statements regarding 2018 earnings per diluted share; 2018 free cash flow; 2018 operating EBITDA; future performance of the solid waste business and future performance of the recycling business, including impact to earnings per share.  You should view these statements with caution. They are based on the facts and circumstances known to the Company as of the date the statements are made. These forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from those set forth in such forward-looking statements, including but not limited to, increased competition; pricing actions; failure to implement our

 

 


 

optimization, growth, and cost savings initiatives and overall business strategy; failure to identify acquisition targets and negotiate attractive terms; failure to consummate or integrate such acquisitions; failure to obtain the results anticipated from acquisitions; environmental and other regulations; commodity price fluctuations; international trade restrictions; disposal alternatives and waste diversion; declining waste volumes; failure to develop and protect new technology; significant environmental or other incidents resulting in liabilities and brand damage; weakness in economic conditions; failure to obtain and maintain necessary permits; labor disruptions; impairment charges; and negative outcomes of  litigation or governmental proceedings.  Please also see the Company’s filings with the SEC, including Part I, Item 1A of the Company’s most recently filed Annual Report on Form 10-K, for additional information regarding these and other risks and uncertainties applicable to our business.  The Company assumes no obligation to update any forward-looking statement, including financial estimates and forecasts, whether as a result of future events, circumstances or developments or otherwise.

 

NON-GAAP FINANCIAL MEASURES

To supplement its financial information, the Company, in some instances, has presented adjusted earnings per diluted share, adjusted net income, adjusted operating EBITDA, adjusted tax rate and free cash flow, and has also discussed projections of adjusted earnings per diluted share, adjusted operating EBITDA, and free cash flow; these are non-GAAP financial measures, as defined in Regulation G of the Securities Exchange Act of 1934, as amended. The Company reports its financial results in compliance with GAAP but believes that also discussing non-GAAP measures provides investors with (i) additional, meaningful comparisons of current results to prior periods’ results by excluding items that the Company does not believe reflect its fundamental business performance and are not representative or indicative of its results of operations and (ii) financial measures the Company uses in the management of its business.

 

The Company’s projected full year 2018 earnings per diluted share and operating EBITDA are anticipated to exclude the effects of events or circumstances in 2018 that are not representative or indicative of the Company’s results of operations. Such excluded items are not currently determinable, but may be significant, such as asset impairments and one-time items, charges, gains or losses from divestitures or litigation, or other items. Due to the uncertainty of the likelihood, amount and timing of any such items, the Company does not have information available to provide a quantitative reconciliation of adjusted projected full-year earnings per diluted share or operating EBITDA to the comparable GAAP measures.

 

The Company discusses free cash flow because the Company believes that it is indicative of its ability to pay its quarterly dividends, repurchase common stock, fund acquisitions and other investments and, in the absence of refinancings, to repay its debt obligations. Free cash flow is not intended to replace “Net cash provided by operating activities,” which is the most comparable GAAP measure. The Company believes free cash flow gives investors useful insight into how the Company views its liquidity, but the use of free cash flow as a liquidity measure has material limitations because it excludes certain expenditures that are required or that the Company has committed to, such as declared dividend payments and debt service requirements. The Company defines free cash flow as net cash provided by operating activities, less capital expenditures, plus proceeds from divestitures of businesses and other assets (net of cash divested); this definition may not be comparable to similarly-titled measures reported by other companies.

 

The quantitative reconciliations of non-GAAP measures used herein to the most comparable GAAP measures are included in the accompanying schedules, with the exception of projected earnings per diluted share and operating EBITDA. Non-GAAP measures should not be considered a substitute for financial measures presented in accordance with GAAP.

 

###

 

 



 

WASTE MANAGEMENT, INC.

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Millions, Except per Share Amounts)

(Unaudited)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30, 

 

September 30, 

 

 

 

2018

 

2017

 

2018

 

2017

 

Operating revenues

 

$

3,822

 

$

3,716

 

$

11,072

 

$

10,833

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

Operating

 

2,373

 

2,302

 

6,870

 

6,758

 

Selling, general and administrative

 

345

 

356

 

1,083

 

1,099

 

Depreciation and amortization

 

376

 

350

 

1,107

 

1,034

 

Restructuring

 

1

 

(2)

 

4

 

 

(Gain) loss from divestitures, asset impairments and unusual items, net

 

28

 

9

 

(14)

 

10

 

 

 

3,123

 

3,015

 

9,050

 

8,901

 

Income from operations

 

699

 

701

 

2,022

 

1,932

 

Other income (expense):

 

 

 

 

 

 

 

 

 

Interest expense, net

 

(93)

 

(90)

 

(277)

 

(272)

 

Equity in net losses of unconsolidated entities

 

(9)

 

(8)

 

(29)

 

(53)

 

Other, net

 

 

 

1

 

 

 

 

(102)

 

(98)

 

(305)

 

(325)

 

Income before income taxes

 

597

 

603

 

1,717

 

1,607

 

Income tax expense

 

99

 

215

 

325

 

561

 

Consolidated net income

 

498

 

388

 

1,392

 

1,046

 

Less: Net income (loss) attributable to noncontrolling interests

 

(1)

 

2

 

(2)

 

 

Net income attributable to Waste Management, Inc.

 

$

499

 

$

386

 

$

1,394

 

$

1,046

 

Basic earnings per common share

 

$

1.16

 

$

0.88

 

$

3.24

 

$

2.37

 

Diluted earnings per common share

 

$

1.16

 

$

0.87

 

$

3.22

 

$

2.36

 

Weighted average basic common shares outstanding

 

427.9

 

437.8

 

430.3

 

440.3

 

Weighted average diluted common shares outstanding

 

430.8

 

440.8

 

433.2

 

443.3

 

Cash dividends declared per common share

 

$

0.465

 

$

0.425

 

$

1.395

 

$

1.275

 

 

1



 

WASTE MANAGEMENT, INC.

 

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Millions)

(Unaudited)

 

 

 

September 30,

 

December 31,

 

 

 

2018

 

2017

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

83

 

$

22

 

Receivables, net

 

2,342

 

2,374

 

Other

 

250

 

228

 

Total current assets

 

2,675

 

2,624

 

Property and equipment, net

 

11,815

 

11,559

 

Goodwill

 

6,390

 

6,247

 

Other intangible assets, net

 

554

 

547

 

Other

 

1,157

 

852

 

Total assets

 

$

22,591

 

$

21,829

 

LIABILITIES AND EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable, accrued liabilities and deferred revenues

 

$

2,623

 

$

2,523

 

Current portion of long-term debt

 

447

 

739

 

Total current liabilities

 

3,070

 

3,262

 

Long-term debt, less current portion

 

9,569

 

8,752

 

Other

 

3,711

 

3,773

 

Total liabilities

 

16,350

 

15,787

 

Equity:

 

 

 

 

 

Waste Management, Inc. stockholders’ equity

 

6,239

 

6,019

 

Noncontrolling interests

 

2

 

23

 

Total equity

 

6,241

 

6,042

 

Total liabilities and equity

 

$

22,591

 

$

21,829

 

 

2



 

WASTE MANAGEMENT, INC.

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Millions)

(Unaudited)

 

 

 

Nine Months Ended

 

 

 

September 30, 

 

 

 

2018

 

2017

 

Cash flows from operating activities:

 

 

 

 

 

Consolidated net income

 

$

1,392

 

$

1,046

 

Adjustments to reconcile consolidated net income to net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

1,107

 

1,034

 

Other

 

131

 

183

 

Change in operating assets and liabilities, net of effects of acquisitions and divestitures

 

28

 

125

 

Net cash provided by operating activities

 

2,658

 

2,388

 

Cash flows from investing activities:

 

 

 

 

 

Acquisitions of businesses, net of cash acquired

 

(342)

 

(78)

 

Capital expenditures

 

(1,240)

 

(981)

 

Proceeds from divestitures of businesses and other assets (net of cash divested)

 

106

 

19

 

Other, net

 

(30)

 

(10)

 

Net cash used in investing activities

 

(1,506)

 

(1,050)

 

Cash flows from financing activities:

 

 

 

 

 

New borrowings

 

174

 

197

 

Debt repayments

 

(338)

 

(749)

 

Net commercial paper borrowings

 

523

 

501

 

Common stock repurchase program

 

(750)

 

(750)

 

Cash dividends

 

(605)

 

(566)

 

Exercise of common stock options

 

45

 

92

 

Tax payments associated with equity-based compensation transactions

 

(28)

 

(47)

 

Other, net

 

(36)

 

(9)

 

Net cash used in financing activities

 

(1,015)

 

(1,331)

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents

 

 

1

 

Increase in cash, cash equivalents and restricted cash and cash equivalents

 

137

 

8

 

Cash, cash equivalents and restricted cash and cash equivalents at beginning of period

 

293

 

94

 

Cash, cash equivalents and restricted cash and cash equivalents at end of period

 

$

430

 

$

102

 

 

 

Prior year information has been revised to reflect the adoption of Accounting Standards Update (ASU) 2016-15 and ASU 2016-18 and conform to our current year presentation.

 

3



 

WASTE MANAGEMENT, INC.

 

SUMMARY DATE SHEET

(In Millions)

(Unaudited)

 

Operating Revenues by Line of Business

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2018

 

2017

 

2018

 

2017

Commercial

 

$

1,007

 

$

936

 

$

2,948

 

$

2,764

Residential

 

639

 

635

 

1,885

 

1,888

Industrial

 

723

 

673

 

2,068

 

1,930

Other

 

117

 

107

 

333

 

330

Total collection

 

2,486

 

2,351

 

7,234

 

6,912

Landfill

 

926

 

884

 

2,646

 

2,487

Transfer

 

445

 

412

 

1,257

 

1,192

Recycling

 

337

 

375

 

954

 

1,122

Other

 

430

 

443

 

1,296

 

1,280

Intercompany (a)

 

(802)

 

(749)

 

(2,315)

 

(2,160)

Total

 

$

3,822

 

$

3,716

 

$

11,072

 

$

10,833

 

Internal Revenue Growth

 

 

 

Period-to-Period Change for the
Three Months Ended
September 30, 2018 vs. 2017

 

Period-to-Period Change for the
Nine Months Ended
September 30, 2018 vs. 2017

 

 

 

 

 

As a % of

 

 

 

As a % of

 

 

 

As a % of

 

 

 

As a % of

 

 

 

 

 

Related

 

 

 

Total

 

 

 

Related

 

 

 

Total

 

 

 

Amount

 

Business(b)

 

Amount

 

Company(c)

 

Amount

 

Business(b)

 

Amount

 

Company(c)

 

Collection and disposal

 

$

78

 

2.5

%

 

 

 

 

$

218

 

2.4

%

 

 

 

 

Recycling commodities

 

(91)

 

(24.3)

 

 

 

 

 

(252)

 

(22.5)

 

 

 

 

 

Fuel surcharges and mandated fees

 

31

 

23.8

 

 

 

 

 

87

 

22.8

 

 

 

 

 

Total average yield (d)

 

 

 

 

 

$

18

 

0.5

%

 

 

 

 

$

53

 

0.5

%

Volume

 

 

 

 

 

155

 

4.2

 

 

 

 

 

309

 

2.9

 

Internal revenue growth

 

 

 

 

 

173

 

4.7

 

 

 

 

 

362

 

3.4

 

Acquisitions

 

 

 

 

 

53

 

1.4

 

 

 

 

 

142

 

1.3

 

Divestitures

 

 

 

 

 

(52)

 

(1.4)

 

 

 

 

 

(90)

 

(0.9)

 

Foreign currency translation and other

 

 

 

 

 

(68)

 

(1.8)

 

 

 

 

 

(175)

 

(1.6)

 

Total

 

 

 

 

 

$

106

 

2.9

%

 

 

 

 

$

239

 

2.2

%

 


(a)

Intercompany revenues between lines of business are eliminated in the Condensed Consolidated Financial Statements included herein.

(b)

Calculated by dividing the increase or decrease for the current year period by the prior year period’s related business revenue adjusted to exclude the impacts of divestitures for the current year period.

(c)

Calculated by dividing the increase or decrease for the current year period by the prior year period’s total Company revenue adjusted to exclude the impacts of divestitures for the current year period.

(d)

The amounts reported herein represent the changes in our revenue attributable to average yield for the total Company.

 

4



 

WASTE MANAGEMENT, INC.

 

SUMMARY DATA SHEET

(In Millions)

(Unaudited)

 

Free Cash Flow Analysis (a)

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2018

 

2017

 

2018

 

2017

Net cash provided by operating activities (b)

 

  $

874

 

  $

853

 

  $

2,658

 

  $

2,388

Capital expenditures

 

(404)

 

(350)

 

(1,240)

 

(981)

Proceeds from divestitures of businesses and other assets (net of cash divested)

 

10

 

6

 

106

 

19

Free cash flow

 

  $

480

 

  $

509

 

  $

1,524

 

  $

1,426

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2018

 

2017

 

2018

 

2017

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Internalization of waste, based on disposal costs

 

67.9%

 

65.6%

 

67.4%

 

65.9%

 

 

 

 

 

 

 

 

 

Landfill amortizable tons (in millions)

 

30.1

 

28.7

 

86.0

 

83.0

 

 

 

 

 

 

 

 

 

Acquisition Summary (c)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross annualized revenue acquired

 

47

 

16

 

215

 

58

 

 

 

 

 

 

 

 

 

Total consideration

 

84

 

31

 

350

 

89

 

 

 

 

 

 

 

 

 

Cash paid for acquisitions consummated during the period, net of cash acquired

 

73

 

26

 

336

 

77

 

 

 

 

 

 

 

 

 

Cash paid for acquisitions including contingent consideration and other items from prior periods, net of cash acquired

 

79

 

29

 

348

 

80

 

Amortization, Accretion and Other Expenses for Landfills Included in Operating Groups:

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2018

 

2017

 

2018

 

2017

Landfill amortization expense

 

 

 

 

 

 

 

 

Cost basis of landfill assets

 

  $

113.5

 

  $

104.7

 

  $

325.8

 

  $

298.6

Asset retirement costs

 

28.0

 

23.4

 

79.9

 

80.0

Total landfill amortization expense

 

141.5

 

128.1

 

405.7

 

378.6

Accretion and other related expense

 

20.5

 

20.0

 

60.3

 

58.8

Landfill amortization, accretion and other related expense

 

  $

162.0

 

  $

148.1

 

  $

466.0

 

  $

437.4

 

(a)    The summary of free cash flow has been prepared to highlight and facilitate understanding of the principal cash flow elements. Free cash flow is not a measure of financial performance under generally accepted accounting principles and is not intended to replace the consolidated statement of cash flows that was prepared in accordance with generally accepted accounting principles.

 

(b)    Prior year information has been revised to reflect the adoption of ASU 2016-18 and conform to our current year presentation.

 

(c)     Represents amounts associated with business acquisitions consummated during the applicable period except where noted.

 

5



 

WASTE MANAGEMENT, INC.

 

RECONCILIATION OF CERTAIN NON-GAAP MEASURES

 

(In Millions, Except Per Share Amounts)

 

(Unaudited)

 

 

 

Three Months Ended
September 30, 2018

 

 

 

Income from
Operations

 

Pre-tax
Income

 

Tax Expense

 

Net
Income (a)

 

Per Share
Amount

As reported amounts

 

  $

699

 

  $

597

 

  $

99

 

  $

499

 

  $

1.16

Adjustments:

 

 

 

 

 

 

 

 

 

 

Benefit primarily related to favorable adjustments from tax reform and changes in state tax laws

 

-

 

-

 

27

 

(27)

 

(0.06)

Impairment of a disposal asset and multiemployer pension plan accrual

 

32

 

32

 

8

 

24

 

0.05

As adjusted amounts

 

  $

731

 

  $

629

 

  $

134

(b)

  $

496

 

  $

1.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended
September 30, 2017

 

 

 

Income from
Operations

 

Pre-tax
Income

 

Tax Expense

 

Net
Income (a)

 

Per Share
Amount

As reported amounts

 

  $

701

 

  $

603

 

  $

215

 

  $

386

 

  $

0.87

Adjustments:

 

 

 

 

 

 

 

 

 

 

Withdrawal from a multiemployer pension plan

 

11

 

11

 

4

 

7

 

0.02

Expense from divestitures, asset impairments and unusual items

 

9

 

9

 

4

 

5

 

0.01

As adjusted amounts

 

  $

721

 

  $

623

 

  $

223

(b)

  $

398

 

  $

0.90

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

 

September 30, 2018

 

September 30, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Operating Expenses and Adjusted Operating Expenses Margin

 

Amount

 

As a % of
Revenues

 

Amount

 

As a % of
Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating revenues, as reported

 

  $

 3,822

 

 

 

  $

3,716

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses, as reported

 

  $

 2,373

 

62.1%

 

  $

2,302

 

61.9%

 

 

Adjustment:

 

 

 

 

 

 

 

 

 

 

Charges related to multiemployer pension plans

 

3

 

 

 

11

 

 

 

 

Adjusted operating expenses

 

  $

 2,370

 

62.0%

 

  $

 2,291

 

61.7%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a)         For purposes of this press release table, all references to “Net income” refer to the financial statement line item “Net income attributable to Waste Management, Inc.”

 

(b)         The Company calculates its effective tax rate based on actual dollars. When the effective tax rate is calculated by dividing the Tax Expense amount in the table above by the Pre-tax Income amount, differences occur due to rounding, as these items have been rounded in millions. The adjusted effective tax rates is 21.3% for the third quarter of 2018.

 

6



 

WASTE MANAGEMENT, INC.

 

RECONCILIATION OF CERTAIN NON-GAAP MEASURES

(In Millions)

(Unaudited)

 

 

 

Three Months Ended

 

 

 

September 30, 2018

 

September 30, 2017

 

Adjusted Operating EBITDA and Adjusted Operating EBITDA Margin

 

Amount

 

As a% of
Revenues

 

Amount

 

As a% of
Revenues

 

 

 

 

 

 

 

 

 

 

 

Operating revenues, as reported

 

  $

3,822

 

 

 

 

  $

3,716

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations, as reported

 

  $

699

 

 

 

 

  $

701

 

 

 

Depreciation and amortization, as reported

 

376

 

 

 

350

 

 

 

Operating EBITDA, as reported

 

  $

1,075

 

28.1%

 

  $

1,051

 

28.3%

 

Adjustments:

 

 

 

 

 

 

 

 

 

Impairment of a disposal asset and multiemployer pension plan accrual

 

32

 

 

 

-

 

 

 

Withdrawal from a multiemployer pension plan

 

-

 

 

 

11

 

 

 

Expense from divestitures, asset impairments and unusual items

 

-

 

 

 

9

 

 

 

Adjusted operating EBITDA (a)

 

  $

1,107

 

29.0%

 

  $

1,071

 

28.8%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

 

 

Adjusted Operating EBITDA, for comparison purposes

 

June 30, 2018

 

June 30, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations, as reported

 

  $

715

 

  $

673

 

 

 

 

 

Depreciation and amortization, as reported

 

384

 

356

 

 

 

 

 

Operating EBITDA, as reported

 

  $

1,099

 

  $

1,029

 

 

 

 

 

Adjustment:

 

 

 

 

 

 

 

 

 

Benefit primarily related to the gain on divestiture of an ancillary business

 

(38)

 

 

 

 

 

 

 

Adjusted operating EBITDA (b)

 

  $

1,061

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2018 Projected Free Cash Flow Reconciliation (c)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Scenario 1

 

Scenario 2

 

 

 

 

 

Net cash provided by operating activities

 

  $

3,500

 

  $

3,550

 

 

 

 

 

Capital expenditures

 

(1,650)

 

(1,700)

 

 

 

 

 

Proceeds from divestitures of businesses and other assets (net of cash divested)

 

100

 

150

 

 

 

 

 

Free cash flow

 

  $

1,950

 

  $

2,000

 

 

 

 

 

 

 

 

 

 

 

(a)           Adjusted operating EBITDA increased $36 million or 3.4% for the third quarter 2018 as compared with adjusted operating EBITDA in the third quarter 2017.

(b)           Adjusted operating EBITDA increased $32 million or 3.1% for the second quarter 2018 as compared with as reported operating EBITDA for the second quarter 2017.

(c)            The reconciliation includes two scenarios that illustrate our projected free cash flow range for 2018. The amounts used in the reconciliation are subject to many variables, some of which are not under our control and, therefore, are not necessarily indicative of actual results.

 

7


View differences made from one to another to evaluate Waste Management Inc's financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 8-K Corporate News to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Waste Management Inc.

Continue

Never Miss A New SEC Filing Again


Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.

Continue

We Highlighted This SEC Filing For You


SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.

Continue

Widen Your SEC Filing Reading Experience


Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view

Continue

Uncover Actionable Information Inside SEC Filings


SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q

Continue

Adobe PDF, Microsoft Word and Excel Downloads


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis

Continue

FREE Financial Statements


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Intrinsic Value Calculator


Intrinsic Value Calculator
Screenshot of intrinsic value for AT&T (2019)
Last10K.com Member Feature

Our Intrinsic Value calculator estimates what an entire company is worth using up to 10 years of financial ratios to determine if a stock is overvalued or not

Continue

Financial Stability Report


Financial Stability Report
Screenshot of financial stability report for Coco-Cola (2019)
Last10K.com Member Feature

Our Financial Stability reports uses up to 10 years of financial ratios to determine the health of a company's EPS, Dividends, Book Value, Return on Equity, Current Ratio and Debt-to-Equity

Continue

Get a Better Picture of a Company's Performance


Financial Ratios
Available Financial Ratios
Last10K.com Member Feature

See how over 70 Growth, Profitability and Financial Ratios perform over 10 Years

Continue

Log in with your credentials

or    

Forgot your details?

Create Account