Casella Waste Systems, Inc. (NASDAQ:CWST), a regional solid waste,
recycling and resource management services company, today reported
its financial results for the three month period ended September
30, 2016. The Company indicated that it expects its revenue
results to be towards the upper-end of its previously announced
guidance range, and the Company also increased its Adjusted EBITDA*
and Normalized Free Cash Flow* guidance ranges for the fiscal year
ending December 31, 2016.
Highlights for the Three Months Ended September 30,
2016:
- Revenues were $151.1 million for the quarter, up $4.9
million, or 3.4%, from the same period in 2015.
- Net income was $7.5 million for the quarter,
up $5.3 million, or 233.6%, from the same period
in 2015.
- Adjusted EBITDA was $37.1 million for the quarter, up
$4.0 million, or 12.2%, from the same period in 2015.
- Adjusted Operating Income* for the quarter was $17.4
million, up $4.2 million, or 24.0%, from the same period in
2015.
- Overall solid waste pricing for the quarter was up
3.0%, mainly driven by strong collection pricing up 3.7% and robust
landfill pricing up 2.7%.
“We had another great quarter as we continued to execute well
against our key management strategies,” said John W. Casella,
Chairman and CEO of Casella Waste Systems, Inc. “Our team is
focused on creating shareholder value through improving returns in
our disposal line-of-business, driving higher profitability in our
collection line-of-business, offsetting risk and improving returns
in our recycling business, and reducing leverage through strict
capital discipline and debt repayment.”
“The progress that has been made on our strategies is clearly
driving positive results in the quarter, with operating income up
$4.7 million, operating income margins up 280 bps, and consolidated
net leverage down,” Casella said. “We have improved operating
income every quarter for the last two years, with operating income
for the twelve months ended September 30, 2016 up $27.5 million (or
up 226.7%) over the twelve months ended December 31, 2014, and
total debt down $21.7 million since December 31, 2014.”
“Disciplined pricing programs are one of the key drivers of our
improved financial performance,” Casella said. “We continued to
advance positive pricing in our residential and commercial
collection lines-of-business, with pricing up 4.2% in the third
quarter. Our disposal pricing programs advanced further in
the third quarter, with our landfill pricing up 2.7% as we improved
pricing in key markets. Further, our efforts to reduce operating
costs and drive efficiencies continued to gain traction in the
third quarter, with cost of operations as a percentage of revenues
down 280 bps year-over-year.”
“As previously announced, on October 17, 2016, we refinanced our
ABL revolver due 2020 and our 7.75% senior subordinated notes due
2019, with a new $160 million revolving credit facility and a $350
million term loan B,” Casella said. “We believe that this
transaction positions us well to continue to execute against our
strategic plan by reducing our cash interest costs by approximately
$11.0 million per year, improving our financial flexibility, and
moving out debt maturities.”
For the quarter, revenues were $151.1 million, up $4.9 million,
or 3.4%, from the same period in 2015, with revenue growth mainly
driven by robust collection, disposal and recycling commodity
pricing, the roll-over impact from the acquisition of three
transfer stations in the second quarter, and higher volumes in the
Company's organics and customer solutions lines-of-business,
partially offset by lower solid waste volumes, primarily associated
with lower margin transportation volumes.
Net income attributable to common stockholders was $7.5 million,
or $0.18 per diluted common share for the quarter, compared to net
income attributable to common stockholders of $2.3 million, or
$0.06 per diluted common share for the same period in 2015. The
current quarter included a $0.2 million loss on debt extinguishment
related to the repurchase and permanent retirement of $5.0 million
of 7.75% senior subordinated notes due 2019, while the same quarter
in 2015 included a $0.3 million loss on debt extinguishment related
to the repurchase and permanent retirement of $9.7 million of 7.75%
senior subordinated notes due 2019.
Operating income was $17.4 million for the quarter, up $4.7
million from the same period in 2015, whereas Adjusted Operating
Income was $17.4 million for the quarter, up $4.2 million from the
same period in 2015. Adjusted EBITDA was $37.1 million for the
quarter, up $4.0 million from the same period in 2015, with growth
mainly driven by improved performance in the Company's collection,
disposal, and recycling lines-of-business.
Net cash provided by operating activities was $20.5 million in
the quarter, up $3.8 million from the same period in 2015. Free
Cash Flow was $5.1 million in the quarter, as compared to $0.8
million for the same period in 2015. Normalized Free Cash Flow was
$5.1 million in the quarter, as compared to $1.6 million for the
same period in 2015. The current quarter did not include any
adjustments differentiating Free Cash Flow from Normalized Free
Cash Flow, while the same period in 2015 included a $0.9 million
adjustment for the cash outlays associated with capping at the
Company's Worcester landfill.
Highlights for the Nine Months Ended September 30,
2016:
- Revenues year-to-date were $421.2 million, up $14.8
million, or 3.6%, from the same period in 2015.
- Net income year-to-date was $5.1 million, up $9.9
million from the same period in 2015.
- Adjusted EBITDA year-to-date was $91.2 million, up
$12.9 million, or 16.5%, from the same period in
2015.
- Adjusted Operating Income year-to-date was $34.9
million, up $12.6 million, or 56.4%, from the same period in
2015.
For the nine months ended September 30, 2016, revenues were
$421.2 million, up $14.8 million, or 3.6%, from the same period in
2015, mainly driven by robust collection and disposal pricing, and
higher volumes in the Company's organics and customer solutions
lines-of-business, partially offset by lower disposal volumes and
lower energy pricing.
Net income attributable to common stockholders was $5.1 million,
or $0.12 per diluted common share year-to-date, compared to $(6.0)
million, or $(0.15) per diluted common share for the same period in
2015.
Operating income was $34.9 million year-to-date, up $7.8 million
from the same period in 2015. Adjusted Operating Income was $34.9
million year-to-date, up $12.6 million from the same period in
2015. Adjusted EBITDA was $91.2 million year-to-date, up $12.9
million from the same period in 2015.
Net cash provided by operating activities was $56.1 million
year-to-date, up $15.5 million from the same period in 2015. Free
Cash Flow was $14.9 million year-to-date, as compared to $11.6
million for the same period in 2015. Normalized Free Cash Flow was
$14.9 million year-to-date, as compared to $9.9 million for the
same period in 2015. The current year-to-date period did not
include any adjustments differentiating Free Cash Flow from
Normalized Free Cash Flow, while the same period in 2015 included a
$(3.1) million adjustment for the net cash proceeds from the CARES
dissolution and a $1.4 million adjustment for the cash outlays
associated with capping at the Company's Worcester landfill.
Outlook
Given the Company's strong pricing and operational performance
during the third quarter and increased visibility into the
remainder of the year, the Company increased its Adjusted EBITDA
and Normalized Free Cash Flow guidance ranges for the year ending
December 31, 2016 by estimating results in the following
ranges:
- Adjusted EBITDA between $116 million and $118 million
(increased from a range of $115 million to $117 million as
announced on September 26, 2016); and
- Normalized Free Cash Flow between $22 million and $25 million
(increased from a range of $20 million to $24 million).
The Company does not provide reconciling information for
forward-looking periods because such information is not available
without an unreasonable effort. The Company believes that
such information is not significant to an understanding of its
non-GAAP financial measures for forward-looking periods because its
methodology for calculating such non-GAAP financial measures is
based on sensitivity analysis compared to budget at the business
unit level rather than on differences from Generally Accepted
Accounting Principles in the United States (“GAAP”) financial
measures.
Conference call to discuss quarter
The Company will host a conference call to discuss these results
on Friday, November 4, 2016 at 10:00 a.m. Eastern Time. Individuals
interested in participating in the call should dial
(877) 838-4153 or for international participants
(720) 545-0037 at least 10 minutes before start time. The call
will also be webcast; to listen, participants should visit Casella
Waste Systems’ website at http://ir.casella.com and follow the
appropriate link to the webcast.
A replay of the call will be available on the Company’s website,
or by calling (855) 859-2056 or (404) 537-3406
(Conference ID 3971428) until 12:00 p.m. ET on November 11,
2016.
About Casella Waste Systems, Inc.
Casella Waste Systems, Inc., headquartered in Rutland, Vermont,
provides solid waste management services consisting of collection,
transfer, disposal, and recycling services in the northeastern
United States. For further information, investors contact Ned
Coletta, Chief Financial Officer at (802) 772-2239; media
contact Joseph Fusco, Vice President at (802) 772-2247; or
visit the Company’s website at http://www.casella.com.
*Non-GAAP Financial Measures
In addition to disclosing financial results prepared in
accordance with GAAP, the Company also discloses earnings before
interest, taxes, and depreciation and amortization, adjusted for
accretion, depletion of landfill operating lease obligations, gains
on asset sales, development project charge write-offs, contract
settlement charges, legal settlement costs, tax settlement costs,
bargain purchase gains, asset impairment charges, environmental
remediation charges, severance and reorganization costs, expenses
from divestiture, acquisition and financing costs, gains on the
settlement of acquisition related contingent consideration, fiscal
year-end transition costs, proxy contest costs, as well as impacts
from divestiture transactions (“Adjusted EBITDA”), which is a
non-GAAP measure.
The Company also discloses earnings before interest and taxes,
adjusted for gains on asset sales, development project charge
write-offs, contract settlement charges, legal settlement costs,
tax settlement costs, bargain purchase gains, asset impairment
charges, environmental remediation charges, severance and
reorganization costs, expenses from divestiture, acquisition and
financing costs, gains on the settlement of acquisition related
contingent consideration, fiscal year-end transition costs, proxy
contest costs, as well as impacts from divestiture transactions
(“Adjusted Operating Income”), which is a non-GAAP measure.
The Company also discloses net cash provided by operating
activities, less capital expenditures (excluding acquisition
related capital expenditures), less payments on landfill operating
lease contracts, plus proceeds from divestiture transactions, plus
proceeds from the sale of property and equipment, plus proceeds
from property insurance settlement, less contributions from
(distributions to) noncontrolling interest holders (“Free Cash
Flow”), which is a non-GAAP measure.
The Company also discloses Free Cash Flow plus certain cash
outflows associated with landfill closure, site improvement and
remediation expenditures, plus certain cash outflows associated
with new contract and project capital expenditures, plus cash
(inflows) outflows associated with certain business dissolutions,
plus cash interest outflows associated with the timing of
refinancing transactions (“Normalized Free Cash Flow”), which is a
non-GAAP measure.
Adjusted EBITDA and Adjusted Operating Income are reconciled to
net income (loss), while Free Cash Flow and Normalized Free Cash
Flow are reconciled to net cash provided by operating
activities.
The Company presents Adjusted EBITDA, Adjusted Operating Income,
Free Cash Flow, and Normalized Free Cash Flow because it considers
them important supplemental measures of its performance and
believes they are frequently used by securities analysts, investors
and other interested parties in the evaluation of the Company’s
results. Management uses these non-GAAP measures to further
understand its “core operating performance.” The Company believes
its “core operating performance” is helpful in understanding its
ongoing performance in the ordinary course of operations. The
Company believes that providing Adjusted EBITDA, Adjusted Operating
Income, Free Cash Flow, and Normalized Free Cash Flow to investors,
in addition to corresponding income statement and cash flow
statement measures, affords investors the benefit of viewing its
performance using the same financial metrics that the management
team uses in making many key decisions and understanding how the
core business and its results of operations has performed. The
Company further believes that providing this information allows its
investors greater transparency and a better understanding of its
core financial performance. In addition, the instruments governing
the Company’s indebtedness use EBITDA (with additional adjustments)
to measure its compliance with covenants.
Non-GAAP financial measures are not in accordance with or an
alternative for GAAP, Adjusted EBITDA, Adjusted Operating Income,
Free Cash Flow, and Normalized Free Cash Flow should not be
considered in isolation from or as a substitute for financial
information presented in accordance with GAAP, and may be different
from Adjusted EBITDA, Adjusted Operating Income, Free Cash Flow, or
Normalized Free Cash Flow presented by other companies.
Safe Harbor Statement
Certain matters discussed in this press release, including, but
not limited to, the statements regarding financial results and
guidance, are “forward-looking statements” intended to qualify for
the safe harbors from liability established by the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements can generally be identified as such by the context of
the statements, including words such as “believe,” “expect,”
“anticipate,” “plan,” “may,” “would,” “intend,” “estimate,”
“guidance” and other similar expressions, whether in the negative
or affirmative. These forward-looking statements are based on
current expectations, estimates, forecasts and projections about
the industry and markets in which the Company operates and
management’s beliefs and assumptions. The Company cannot guarantee
that it actually will achieve the financial results, plans,
intentions, expectations or guidance disclosed in the
forward-looking statements made. Such forward-looking statements,
and all phases of the Company's operations, involve a number of
risks and uncertainties, any one or more of which could cause
actual results to differ materially from those described in its
forward-looking statements. Such risks and uncertainties include or
relate to, among other things: adverse weather conditions that have
negatively impacted and may continue to negatively impact its
revenues and its operating margin; current economic conditions that
have adversely affected and may continue to adversely affect its
revenues and its operating margin; the Company may be unable to
increase volumes at its landfills or improve its route
profitability; the Company's need to service its indebtedness may
limit its ability to invest in its business; the Company may be
unable to reduce costs or increase pricing or volumes sufficiently
to achieve estimated Adjusted EBITDA and other targets; landfill
operations and permit status may be affected by factors outside its
control; groundwater contamination discovered near the Southbridge
landfill may delay or negatively impact its permitting activities
at that landfill and result in costs and liabilities as well as
impacting its disposal revenues at that site, each of which could
impact its results of operations; the Company may be required to
incur capital expenditures in excess of its estimates; fluctuations
in energy pricing or the commodity pricing of its recyclables may
make it more difficult for the Company to predict its results of
operations or meet its estimates; the Company may incur
environmental charges or asset impairments in the future; and the
Company's Credit Facility agreement requires it to meet a number of
financial ratios and covenants. There are a number of other
important risks and uncertainties that could cause the Company's
actual results to differ materially from those indicated by such
forward-looking statements. These additional risks and
uncertainties include, without limitation, those detailed in
Item 1A, “Risk Factors” in the Company's Form 10-K for the
fiscal year ended December 31, 2015.
The Company undertakes no obligation to update publicly any
forward-looking statements whether as a result of new information,
future events or otherwise, except as required by law.
|
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(Unaudited) |
(In thousands, except for per share
data) |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Revenues |
$ |
151,133 |
|
|
$ |
146,185 |
|
|
$ |
421,236 |
|
|
$ |
406,476 |
|
Operating expenses: |
|
|
|
|
|
|
|
Cost of
operations |
98,803 |
|
|
99,656 |
|
|
284,409 |
|
|
286,225 |
|
General and
administration |
18,777 |
|
|
17,448 |
|
|
55,450 |
|
|
52,324 |
|
Depreciation
and amortization |
16,175 |
|
|
16,385 |
|
|
46,430 |
|
|
46,374 |
|
Divestiture
transactions |
— |
|
|
— |
|
|
— |
|
|
(5,611 |
) |
|
133,755 |
|
|
133,489 |
|
|
386,289 |
|
|
379,312 |
|
Operating income |
17,378 |
|
|
12,696 |
|
|
34,947 |
|
|
27,164 |
|
Other expense
(income): |
|
|
|
|
|
|
|
Interest
expense, net |
9,579 |
|
|
10,031 |
|
|
29,448 |
|
|
30,096 |
|
Loss on debt
extinguishment |
191 |
|
|
345 |
|
|
736 |
|
|
866 |
|
Loss on
derivative instruments |
— |
|
|
41 |
|
|
— |
|
|
239 |
|
Other
income |
(192 |
) |
|
(178 |
) |
|
(697 |
) |
|
(387 |
) |
Other expense, net |
9,578 |
|
|
10,239 |
|
|
29,487 |
|
|
30,814 |
|
Income (loss) before
income taxes |
7,800 |
|
|
2,457 |
|
|
5,460 |
|
|
(3,650 |
) |
Provision for income
taxes |
263 |
|
|
198 |
|
|
344 |
|
|
1,112 |
|
Net income (loss) |
7,537 |
|
|
2,259 |
|
|
5,116 |
|
|
(4,762 |
) |
Less: Net
income (loss) attributable to noncontrolling interests |
— |
|
|
(37 |
) |
|
(9 |
) |
|
1,189 |
|
Net income (loss)
attributable to common stockholders |
$ |
7,537 |
|
|
$ |
2,296 |
|
|
$ |
5,125 |
|
|
$ |
(5,951 |
) |
Basic weighted average
common shares outstanding |
41,377 |
|
|
40,810 |
|
|
41,169 |
|
|
40,560 |
|
Basic earnings per
share |
$ |
0.18 |
|
|
$ |
0.06 |
|
|
$ |
0.12 |
|
|
$ |
(0.15 |
) |
Diluted weighted average
common shares outstanding |
42,287 |
|
|
41,283 |
|
|
41,896 |
|
|
40,560 |
|
Diluted earnings per
common share |
$ |
0.18 |
|
|
$ |
0.06 |
|
|
$ |
0.12 |
|
|
$ |
(0.15 |
) |
Adjusted EBITDA |
$ |
37,146 |
|
|
$ |
33,116 |
|
|
$ |
91,195 |
|
|
$ |
78,309 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(In thousands) |
|
ASSETS |
|
September 30, 2016 |
|
December 31, 2015 |
|
|
(Unaudited) |
|
|
CURRENT ASSETS: |
|
|
|
|
Cash and
cash equivalents |
|
$ |
3,561 |
|
|
$ |
2,312 |
|
Accounts
receivable — trade, net of allowance for doubtful accounts |
|
63,355 |
|
|
60,167 |
|
Other
current assets |
|
16,168 |
|
|
14,189 |
|
Total current assets |
|
83,084 |
|
|
76,668 |
|
Property, plant and
equipment, net of accumulated depreciation and amortization |
|
397,491 |
|
|
402,252 |
|
Goodwill |
|
119,899 |
|
|
118,976 |
|
Intangible assets,
net |
|
8,232 |
|
|
9,252 |
|
Restricted assets |
|
931 |
|
|
2,251 |
|
Cost method
investments |
|
12,333 |
|
|
12,333 |
|
Other non-current
assets |
|
13,285 |
|
|
11,937 |
|
Total
assets |
|
$ |
635,255 |
|
|
$ |
633,669 |
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
Current
maturities of long-term debt and capital leases |
|
$ |
1,562 |
|
|
$ |
1,448 |
|
Accounts
payable |
|
47,297 |
|
|
44,921 |
|
Other
accrued liabilities |
|
31,994 |
|
|
38,977 |
|
Total current
liabilities |
|
80,853 |
|
|
85,346 |
|
Long-term debt and capital
leases, less current maturities |
|
499,039 |
|
|
505,985 |
|
Other long-term
liabilities |
|
69,270 |
|
|
63,935 |
|
Total stockholders'
deficit |
|
(13,907 |
) |
|
(21,597 |
) |
Total
liabilities and stockholders' deficit |
|
$ |
635,255 |
|
|
$ |
633,669 |
|
|
|
|
|
|
|
|
|
|
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(Unaudited) |
(In thousands) |
|
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
Cash Flows from Operating
Activities: |
|
|
|
Net income (loss) |
$ |
5,116 |
|
|
$ |
(4,762 |
) |
Adjustments to reconcile
net income (loss) to net cash provided by operating
activities: |
|
|
|
Depreciation
and amortization |
46,430 |
|
|
46,374 |
|
Depletion of
landfill operating lease obligations |
7,130 |
|
|
7,019 |
|
Interest
accretion on landfill and environmental remediation
liabilities |
2,688 |
|
|
2,572 |
|
Amortization
of debt issuance costs and discount on long-term debt |
3,106 |
|
|
2,941 |
|
Stock-based
compensation |
2,377 |
|
|
2,325 |
|
Gain on sale
of property and equipment |
(541 |
) |
|
(137 |
) |
Divestiture
transactions |
— |
|
|
(5,611 |
) |
Loss on debt
extinguishment |
736 |
|
|
866 |
|
Loss on
derivative instruments |
— |
|
|
239 |
|
Excess tax
benefit on the vesting of share based awards |
— |
|
|
(179 |
) |
Deferred
income taxes |
528 |
|
|
627 |
|
Changes in
assets and liabilities, net of effects of acquisitions and
divestitures |
(11,499 |
) |
|
(11,744 |
) |
Net cash
provided by operating activities |
56,071 |
|
|
40,530 |
|
Cash Flows from Investing
Activities: |
|
|
|
Acquisitions, net of cash acquired |
(2,439 |
) |
|
— |
|
Acquisition
related additions to property, plant and equipment |
(38 |
) |
|
— |
|
Additions to
property, plant and equipment |
(37,435 |
) |
|
(31,038 |
) |
Payments on
landfill operating lease contracts |
(4,811 |
) |
|
(2,956 |
) |
Proceeds
from divestiture transactions |
— |
|
|
5,335 |
|
Proceeds
from sale of property and equipment |
1,069 |
|
|
636 |
|
Proceeds
from property insurance settlement |
— |
|
|
546 |
|
Net cash
used in investing activities |
(43,654 |
) |
|
(27,477 |
) |
Cash Flows from Financing
Activities: |
|
|
|
Proceeds
from long-term borrowings |
140,700 |
|
|
296,929 |
|
Principal
payments on long-term debt |
(152,123 |
) |
|
(301,220 |
) |
Payments of
debt issuance costs |
(682 |
) |
|
(8,991 |
) |
Payments of
debt extinguishment costs |
(410 |
) |
|
(121 |
) |
Proceeds
from the exercise of share based awards |
— |
|
|
161 |
|
Excess tax
benefit on the vesting of share based awards |
— |
|
|
179 |
|
Change in
restricted cash |
1,347 |
|
|
1,319 |
|
Distribution
to noncontrolling interest holder |
— |
|
|
(1,495 |
) |
Net cash
used in financing activities |
(11,168 |
) |
|
(13,239 |
) |
Net increase (decrease) in
cash and cash equivalents |
1,249 |
|
|
(186 |
) |
Cash and cash equivalents,
beginning of period |
2,312 |
|
|
2,205 |
|
Cash and cash equivalents,
end of period |
$ |
3,561 |
|
|
$ |
2,019 |
|
Supplemental Disclosure of
Cash Flow Information: |
|
|
|
Cash
interest |
$ |
33,723 |
|
|
$ |
33,364 |
|
Cash income
taxes, net of refunds |
$ |
242 |
|
|
$ |
31 |
|
Supplemental Disclosure of
Non-Cash Investing and Financing Activities: |
|
|
|
Non-current
assets obtained through long-term obligations |
$ |
1,841 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIES RECONCILIATION OF CERTAIN NON-GAAP
MEASURES (Unaudited) (In
thousands)
Following is a reconciliation of net income (loss) to
Adjusted EBITDA and Adjusted Operating Income:
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Net income
(loss) |
$ |
7,537 |
|
|
$ |
2,259 |
|
|
$ |
5,116 |
|
|
$ |
(4,762 |
) |
Provision
for income taxes |
263 |
|
|
198 |
|
|
344 |
|
|
1,112 |
|
Other
income |
(192 |
) |
|
(178 |
) |
|
(697 |
) |
|
(387 |
) |
Loss on
derivative instruments |
— |
|
|
41 |
|
|
— |
|
|
239 |
|
Loss on debt
extinguishment |
191 |
|
|
345 |
|
|
736 |
|
|
866 |
|
Interest
expense, net |
9,579 |
|
|
10,031 |
|
|
29,448 |
|
|
30,096 |
|
Divestiture
transactions |
— |
|
|
— |
|
|
— |
|
|
(5,611 |
) |
Depreciation
and amortization |
16,175 |
|
|
16,385 |
|
|
46,430 |
|
|
46,374 |
|
Proxy
contest costs |
— |
|
|
507 |
|
|
— |
|
|
791 |
|
Depletion of
landfill operating lease obligations |
2,687 |
|
|
2,660 |
|
|
7,130 |
|
|
7,019 |
|
Interest
accretion on landfill and environmental remediation
liabilities |
906 |
|
|
868 |
|
|
2,688 |
|
|
2,572 |
|
Adjusted
EBITDA |
$ |
37,146 |
|
|
$ |
33,116 |
|
|
$ |
91,195 |
|
|
$ |
78,309 |
|
Depreciation
and amortization |
(16,175 |
) |
|
(16,385 |
) |
|
(46,430 |
) |
|
(46,374 |
) |
Depletion of
landfill operating lease obligations |
(2,687 |
) |
|
(2,660 |
) |
|
(7,130 |
) |
|
(7,019 |
) |
Interest
accretion on landfill and environmental remediation
liabilities |
(906 |
) |
|
(868 |
) |
|
(2,688 |
) |
|
(2,572 |
) |
Adjusted Operating
Income |
$ |
17,378 |
|
|
$ |
13,203 |
|
|
$ |
34,947 |
|
|
$ |
22,344 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Following is a reconciliation of net cash provided by
operating activities to Free Cash Flow and Normalized Free
Cash Flow:
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Net cash provided
by operating activities |
$ |
20,486 |
|
|
$ |
16,641 |
|
|
$ |
56,071 |
|
|
$ |
40,530 |
|
Capital
expenditures |
(13,975 |
) |
|
(14,727 |
) |
|
(37,435 |
) |
|
(31,038 |
) |
Payments on
landfill operating lease contracts |
(1,485 |
) |
|
(1,531 |
) |
|
(4,811 |
) |
|
(2,956 |
) |
Proceeds
from divestiture transactions |
— |
|
|
— |
|
|
— |
|
|
5,335 |
|
Proceeds
from sale of property and equipment |
112 |
|
|
377 |
|
|
1,069 |
|
|
636 |
|
Proceeds
from property insurance settlement |
— |
|
|
— |
|
|
— |
|
|
546 |
|
Distribution
to noncontrolling interest holder |
— |
|
|
— |
|
|
— |
|
|
(1,495 |
) |
Free Cash
Flow |
$ |
5,138 |
|
|
$ |
760 |
|
|
$ |
14,894 |
|
|
$ |
11,558 |
|
Landfill
closure, site improvement and remediation expenditures (i)
|
— |
|
|
878 |
|
|
— |
|
|
1,431 |
|
Net cash
proceeds from CARES dissolution (ii) |
— |
|
|
— |
|
|
— |
|
|
(3,055 |
) |
Normalized Free
Cash Flow |
$ |
5,138 |
|
|
$ |
1,638 |
|
|
$ |
14,894 |
|
|
$ |
9,934 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(i) Includes cash outlays associated with Worcester
landfill capping.(ii) Includes cash proceeds and cash distribution
associated with the dissolution of CARES.
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIESSUPPLEMENTAL DATA
TABLES(Unaudited)(In
thousands)
Amounts of total revenues attributable to services
provided for the three and nine months ended September 30,
2016 and 2015 are as follows:
|
Three Months Ended September 30, |
|
2016 |
|
% of TotalRevenue |
|
2015 |
|
% of TotalRevenue |
Collection |
$ |
65,581 |
|
|
43.4 |
% |
|
$ |
63,588 |
|
|
43.5 |
% |
Disposal |
43,412 |
|
|
28.7 |
% |
|
43,168 |
|
|
29.5 |
% |
Power generation |
1,610 |
|
|
1.1 |
% |
|
1,694 |
|
|
1.2 |
% |
Processing |
1,974 |
|
|
1.3 |
% |
|
1,866 |
|
|
1.3 |
% |
Solid waste operations |
112,577 |
|
|
74.5 |
% |
|
110,316 |
|
|
75.5 |
% |
Organics |
10,266 |
|
|
6.8 |
% |
|
9,753 |
|
|
6.6 |
% |
Customer
solutions |
13,878 |
|
|
9.2 |
% |
|
13,416 |
|
|
9.2 |
% |
Recycling |
14,412 |
|
|
9.5 |
% |
|
12,700 |
|
|
8.7 |
% |
Total
revenues |
$ |
151,133 |
|
|
100.0 |
% |
|
$ |
146,185 |
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
2016 |
|
% of
TotalRevenue |
|
2015 |
|
% of
TotalRevenue |
Collection |
$ |
187,117 |
|
|
44.4 |
% |
|
$ |
177,550 |
|
|
43.7 |
% |
Disposal |
115,050 |
|
|
27.3 |
% |
|
114,999 |
|
|
28.3 |
% |
Power generation |
4,777 |
|
|
1.1 |
% |
|
5,305 |
|
|
1.3 |
% |
Processing |
4,694 |
|
|
1.2 |
% |
|
4,652 |
|
|
1.1 |
% |
Solid waste operations |
311,638 |
|
|
74.0 |
% |
|
302,506 |
|
|
74.4 |
% |
Organics |
31,372 |
|
|
7.4 |
% |
|
29,619 |
|
|
7.3 |
% |
Customer
solutions |
40,361 |
|
|
9.6 |
% |
|
39,895 |
|
|
9.8 |
% |
Recycling |
37,865 |
|
|
9.0 |
% |
|
34,456 |
|
|
8.5 |
% |
Total
revenues |
$ |
421,236 |
|
|
100.0 |
% |
|
$ |
406,476 |
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of revenue growth for the three months ended
September 30, 2016 compared to the three months ended
September 30, 2015 are as follows:
|
Amount |
|
%
ofRelatedBusiness |
|
% of
SolidWasteOperations |
|
% of TotalCompany |
Solid Waste
Operations: |
|
|
|
|
|
|
|
Collection |
$ |
2,383 |
|
|
3.7 |
% |
|
2.2 |
% |
|
1.6 |
% |
Disposal |
967 |
|
|
2.2 |
% |
|
0.8 |
% |
|
0.7 |
% |
Solid Waste
Price |
3,350 |
|
|
|
|
3.0 |
% |
|
2.3 |
% |
Collection |
(293 |
) |
|
|
|
(0.3 |
)% |
|
(0.2 |
)% |
Disposal |
(1,337 |
) |
|
|
|
(1.2 |
)% |
|
(0.9 |
)% |
Processing |
14 |
|
|
|
|
— |
% |
|
— |
% |
Solid Waste
Volume |
(1,616 |
) |
|
|
|
(1.5 |
)% |
|
(1.1 |
)% |
Fuel
surcharge |
(11 |
) |
|
|
|
— |
% |
|
(0.1 |
)% |
Commodity
price & volume |
10 |
|
|
|
|
— |
% |
|
— |
% |
Acquisitions, net divestitures |
528 |
|
|
|
|
0.5 |
% |
|
0.4 |
% |
Total Solid
Waste |
2,261 |
|
|
|
|
2.0 |
% |
|
1.5 |
% |
Organics |
513 |
|
|
|
|
|
|
0.4 |
% |
Customer
Solutions |
462 |
|
|
|
|
|
|
0.3 |
% |
|
|
|
|
|
|
|
|
Recycling
Operations: |
|
|
|
|
% of Recycling
Operations |
|
|
Price |
1,880 |
|
|
|
|
14.8 |
% |
|
1.3 |
% |
Volume |
(168 |
) |
|
|
|
(1.3 |
)% |
|
(0.1 |
)% |
Total
Recycling |
1,712 |
|
|
|
|
13.5 |
% |
|
1.2 |
% |
Total
Company |
$ |
4,948 |
|
|
|
|
|
|
3.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
Solid Waste Internalization Rates by Region for the
three and nine months ended September 30, 2016 and 2015 are as
follows:
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Eastern region |
59.6 |
% |
|
57.5 |
% |
|
52.9 |
% |
|
50.6 |
% |
Western region |
75.2 |
% |
|
70.9 |
% |
|
74.6 |
% |
|
72.2 |
% |
Solid waste
internalization |
67.1 |
% |
|
63.8 |
% |
|
63.1 |
% |
|
60.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Components of capital expenditures for the three and
nine months ended September 30, 2016 and 2015 are as follows
(iii):
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Total Growth
Capital Expenditures |
$ |
829 |
|
|
$ |
938 |
|
|
$ |
4,291 |
|
|
$ |
3,387 |
|
Replacement
Capital Expenditures: |
|
|
|
|
|
|
|
Landfill
development |
10,190 |
|
|
6,334 |
|
|
21,647 |
|
|
11,952 |
|
Vehicles,
machinery, equipment and containers |
2,336 |
|
|
6,330 |
|
|
9,680 |
|
|
13,037 |
|
Facilities |
452 |
|
|
659 |
|
|
1,132 |
|
|
1,162 |
|
Other |
168 |
|
|
466 |
|
|
685 |
|
|
1,500 |
|
Total Replacement
Capital Expenditures |
13,146 |
|
|
13,789 |
|
|
33,144 |
|
|
27,651 |
|
Total Growth and
Replacement Capital Expenditures |
$ |
13,975 |
|
|
$ |
14,727 |
|
|
$ |
37,435 |
|
|
$ |
31,038 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(iii) The Company's capital expenditures are broadly defined as
pertaining to either growth, replacement or acquisition activities.
Growth capital expenditures are defined as costs related to
development of new airspace, permit expansions, and new recycling
contracts along with incremental costs of equipment and
infrastructure added to further such activities. Growth capital
expenditures include the cost of equipment added directly as a
result of organic business growth as well as expenditures
associated with adding infrastructure to increase throughput at
transfer stations and recycling facilities. Replacement capital
expenditures are defined as landfill cell construction costs not
related to expansion airspace, costs for normal permit renewals,
and replacement costs for equipment due to age or obsolescence.
Acquisition capital expenditures, which are not included in the
table above, are defined as costs of equipment added directly as a
result of new business growth related to an acquisition.
Investors:
Ned Coletta
Chief Financial Officer
(802) 772-2239
Media:
Joseph Fusco
Vice President
(802) 772-2247
http://www.casella.com
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