Casella Waste Systems Inc. (CWST) said Wednesday its fiscal
second-quarter loss unexpectedly narrowed on revenue that also
topped views.
The Northeast-focused trash-hauling company had particularly
strong results in its landfill business, where tonnage was up 16%,
according to Chairman and Chief Executive John W. Casella. The
company also reported its solid-waste volume was a significant
contributor to revenue growth and that prices for recycled
commodities improved as well.
Casella Waste Systems's business fundamentals have improved in
recent quarters, with the volumes and recycled-commodities prices
strengthening, although it has posted losses for seven straight
quarters. To cope, the company has cut workers, increased prices
and reduced capital expenditures. It also has been easing its debt
load.
Like other trash haulers, Casella's gross margin has been a weak
spot lately, declining to 34.1% from 35.1% in the most recent
period. Competitors Republic Services Inc. (RSG) and Waste
Management Inc. (WM) reported narrowed margins in their latest
quarters, though earnings still rose.
For the quarter ended Oct. 31, Casella posted a loss of $1.2
million, or 4 cents a share, compared with a year-earlier loss of
$1.6 million, or 6 cents a share. Revenue increased 5.9% to $141
million.
Analysts surveyed by Thomson Reuters had predicted an 8-cent
loss on revenue of $139 million.
Shares of Casella, which affirmed its revenue guidance for the
year, closed Wednesday down 2.4% at $4.45 despite a wide market
climb and weren't active after hours.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com