- Solid waste pricing growth of 7.1% drives
underlying margin expansion and better than expected Q1
results
- Revenue of $1.646 billion, up
17.9%
- Net income(a) of $180.3 million, and adjusted
EBITDA(b) of $502.1
million, or 30.5% of revenue and up 15.9%
- Net income of $0.69 per share,
and adjusted net income(b) of $0.82 per share, up 17.1%
- Net cash provided by operating activities of $440.9 million and adjusted free cash
flow(b) of $320.4
million, or 19.5% of revenue and up 10.6% year over
year
- Completes acquisitions with approximately $175 million of total annualized revenue
TORONTO, May 3, 2022
/CNW/ -- Waste Connections, Inc. (TSX/NYSE: WCN) ("Waste
Connections" or the "Company") today announced its results for the
first quarter of 2022.
"We are extremely pleased by our strong start to the
year, with record solid waste pricing growth driving
underlying margin expansion in spite of inflationary pressures.
Our 50 basis points year-over-year decline in adjusted
EBITDA(b) margin in the quarter included 90 basis
points combined margin impact, as expected, from $10 million of COVID-related frontline support in
January and acquisitions completed since the prior year
period. Looking ahead, further sequential improvement in
solid waste pricing growth, increasing E&P waste activity and
strong operational execution should continue to differentiate our
performance," said Worthing F.
Jackman, President and Chief Executive
Officer. "Moreover, adjusted free cash
flow(b) generation of over $320 million, or 19.5% of revenue in the period,
positions us to meet or exceed our full year adjusted free cash
flow(b) outlook of $1.150
billion."
Mr. Jackman added, "The elevated cadence of solid waste
acquisition activity has continued, with approximately $175 million in annualized revenues closed year
to date, confirming our expectations for another outsized year of
such activity, for which we remain well-positioned."
Q1 2022 Results
Revenue in the first quarter totaled $1.646 billion, up from $1.396 billion in the year ago period.
Operating income was $273.9 million,
which included $4.7 million in
acquisition-related costs and $1.9
million in impairments and other operating items. This
compares to operating income of $238.4
million in the first quarter of 2021, which included
$1.5 million in primarily
acquisition-related costs. Net income in the first quarter
was $180.3 million, or $0.69 per share on a diluted basis of 259.6
million shares. In the year ago period, the Company reported
net income of $160.3 million, or
$0.61 per share on a diluted basis of
263.2 million shares.
Adjusted net income(b) in the first quarter was
$213.4 million, or $0.82 per diluted share, versus $185.5 million, or $0.70 per diluted share, in the prior year
period. Adjusted EBITDA(b) in the first quarter
was $502.1 million, as compared to
$433.2 million in the prior year
period. Adjusted net income, adjusted net income per diluted
share and adjusted EBITDA, all non-GAAP measures, primarily
exclude impairments and acquisition-related items, as
reflected in the detailed reconciliations in the attached
tables.
Environmental, Social and Governance
Waste Connections views its Environmental, Social and Governance
("ESG") efforts as integral to its business, with initiatives
consistent with its objective of long-term value creation. In
2020, the Company introduced long-term, aspirational ESG targets
and committed over $500 million for
investments to meet or exceed such sustainability targets. These
investments primarily focus on reducing emissions, increasing
resource recovery of both recyclable commodities and clean energy
fuels, reducing reliance on off-site disposal for landfill
leachate, further improving safety through reduced incidents and
enhancing employee engagement through improved voluntary turnover
and Servant Leadership scores. The Company's 2021
Sustainability Report provides progress updates on its targets and
investments towards their achievement. For more information,
visit the Waste Connections website at
wasteconnections.com/sustainability.
Q1 2022 Earnings Conference Call
Waste Connections will be hosting a conference call related to
first quarter earnings on May 4th at
8:30 A.M. Eastern Time. A live
audio webcast of the conference call can be accessed by visiting
investors.wasteconnections.com and selecting "News & Events"
from the website menu. Alternatively, listeners may access the call
by dialing 800-926-4425 (within North
America) or 212-231-2911 (international) approximately 10
minutes prior to the scheduled start time; a passcode is not
required. A replay of the conference call will be available
until May 11, 2022, by calling
800-633-8284 (within North
America) or 402-977-9140 (international) and entering
Passcode #22017071.
Waste Connections will be filing a Form 8-K on EDGAR and on
SEDAR (as an "Other" document) prior to markets opening on
May 4th, providing the
Company's second quarter 2022 outlook for revenue, price plus
volume growth for solid waste, and adjusted
EBITDA(b).
|
|
|
|
(a) All references to
"Net income" refer to the financial statement line item "Net income
attributable to Waste Connections"
|
(b) A non-GAAP measure;
see accompanying Non-GAAP Reconciliation Schedule
|
About Waste Connections
Waste Connections is an integrated solid waste services company
that provides non-hazardous waste collection, transfer and disposal
services, along with resource recovery primarily through recycling
and renewable fuels generation. The Company serves more than
eight million residential, commercial and industrial customers in
mostly exclusive and secondary markets across 43 states in the U.S.
and six provinces in Canada. Waste Connections also provides
non-hazardous oilfield waste treatment, recovery and disposal
services in several basins across the U.S., as well as intermodal
services for the movement of cargo and solid waste containers in
the Pacific Northwest. For more information, visit Waste
Connections at wasteconnections.com.
Safe Harbor and Forward-Looking Information
This press release contains forward-looking statements within
the meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995 ("PSLRA"), including
"forward-looking information" within the meaning of applicable
Canadian securities laws. These forward-looking statements are
neither historical facts nor assurances of future performance and
reflect Waste Connections' current beliefs and expectations
regarding future events and operating performance. These
forward-looking statements are often identified by the words "may,"
"might," "believes," "thinks," "expects," "estimate," "continue,"
"intends" or other words of similar meaning. All of the
forward-looking statements included in this press release are made
pursuant to the safe harbor provisions of the PSLRA and applicable
securities laws in Canada.
Forward-looking statements involve risks and uncertainties.
Forward-looking statements in this press release include, but are
not limited to, statements about expected 2022 financial results,
outlook and related assumptions, and potential acquisition
activity. Important factors that could cause actual results to
differ, possibly materially, from those indicated by the
forward-looking statements include, but are not limited to, risk
factors detailed from time to time in the Company's filings with
the SEC and the securities commissions or similar regulatory
authorities in Canada. You should not place undue reliance on
forward-looking statements, which speak only as of the date of this
press release. Waste Connections undertakes no obligation to
update the forward-looking statements set forth in this press
release, whether as a result of new information, future events, or
otherwise, unless required by applicable securities laws.
– financial tables attached –
CONTACT:
|
|
Mary Anne Whitney /
(832) 442-2253
|
Joe Box / (832)
442-2153
|
maryannew@wasteconnections.com
|
joe.box@wasteconnections.com
|
WASTE CONNECTIONS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF NET INCOME
THREE MONTHS ENDED
MARCH 31, 2021 AND 2022
(Unaudited)
(in thousands of U.S.
dollars, except share and per share amounts)
|
|
|
|
Three months ended
March 31,
|
|
|
2021
|
|
2022
|
|
|
|
|
|
Revenues
|
|
$
|
1,395,942
|
|
$
|
1,646,255
|
Operating
expenses:
|
|
|
|
|
|
|
Cost of operations
|
|
|
825,920
|
|
|
989,518
|
Selling, general and administrative
|
|
|
141,422
|
|
|
163,414
|
Depreciation
|
|
|
157,402
|
|
|
179,950
|
Amortization of intangibles
|
|
|
32,192
|
|
|
37,635
|
Impairments and other operating items
|
|
|
634
|
|
|
1,878
|
Operating
income
|
|
|
238,372
|
|
|
273,860
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(42,425)
|
|
|
(41,324)
|
Interest
income
|
|
|
1,103
|
|
|
137
|
Other income (expense),
net
|
|
|
3,548
|
|
|
(3,466)
|
Income before income
tax provision
|
|
|
200,598
|
|
|
229,207
|
|
|
|
|
|
|
|
Income tax
provision
|
|
|
(40,291)
|
|
|
(48,839)
|
Net income
|
|
|
160,307
|
|
|
180,368
|
Plus (less): Net loss (income) attributable to noncontrolling
interests
|
|
|
2
|
|
|
(44)
|
Net income attributable
to Waste Connections
|
|
$
|
160,309
|
|
$
|
180,324
|
|
|
|
|
|
|
|
Earnings per common
share attributable to Waste Connections' common
shareholders:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.61
|
|
$
|
0.70
|
|
|
|
|
|
|
|
Diluted
|
|
$
|
0.61
|
|
$
|
0.69
|
|
|
|
|
|
|
|
Shares used in the per
share calculations:
|
|
|
|
|
|
|
Basic
|
|
|
262,697,487
|
|
|
258,946,933
|
Diluted
|
|
|
263,156,655
|
|
|
259,560,983
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per
common share
|
|
$
|
0.205
|
|
$
|
0.23
|
WASTE CONNECTIONS,
INC.
CONDENSED CONSOLIDATED
BALANCE SHEETS
(Unaudited)
(in thousands of U.S.
dollars, except share and per share amounts)
|
|
|
|
December 31,
2021
|
|
March 31,
2022
|
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and equivalents
|
|
$
|
147,441
|
|
$
|
391,417
|
|
Accounts receivable, net of allowance for credit losses of
$18,480 and $19,361 at
December 31, 2021 and March 31, 2022,
respectively
|
|
|
709,614
|
|
|
727,737
|
|
Prepaid expenses and other current assets
|
|
|
175,722
|
|
|
293,625
|
|
Total current assets
|
|
|
1,032,777
|
|
|
1,412,779
|
|
Restricted
cash
|
|
|
72,174
|
|
|
71,867
|
|
Restricted
investments
|
|
|
59,014
|
|
|
59,449
|
|
Property and equipment,
net
|
|
|
5,721,949
|
|
|
5,770,931
|
|
Operating lease
right-of-use assets
|
|
|
160,567
|
|
|
162,332
|
|
Goodwill
|
|
|
6,187,643
|
|
|
6,427,763
|
|
Intangible assets,
net
|
|
|
1,350,597
|
|
|
1,388,687
|
|
Other assets,
net
|
|
|
115,203
|
|
|
120,554
|
|
Total assets
|
|
$
|
14,699,924
|
|
$
|
15,414,362
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
392,868
|
|
$
|
423,175
|
|
Book overdraft
|
|
|
16,721
|
|
|
16,809
|
|
Deferred revenue
|
|
|
273,720
|
|
|
293,729
|
|
Accrued liabilities
|
|
|
442,596
|
|
|
396,292
|
|
Current portion of operating lease liabilities
|
|
|
38,017
|
|
|
35,079
|
|
Current portion of contingent consideration
|
|
|
62,804
|
|
|
64,480
|
|
Current portion of long-term debt and notes
payable
|
|
|
6,020
|
|
|
28,070
|
|
Total current
liabilities
|
|
|
1,232,746
|
|
|
1,257,634
|
|
|
|
|
|
|
|
|
|
Long-term portion of
debt and notes payable
|
|
|
5,040,500
|
|
|
5,817,641
|
|
Long-term portion of
operating lease liabilities
|
|
|
129,628
|
|
|
134,392
|
|
Long-term portion of
contingent consideration
|
|
|
31,504
|
|
|
31,558
|
|
Deferred income
taxes
|
|
|
850,921
|
|
|
1,002,800
|
|
Other long-term
liabilities
|
|
|
421,080
|
|
|
411,278
|
|
Total liabilities
|
|
|
7,706,379
|
|
|
8,655,303
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
Common shares:
260,283,158 shares issued and 260,212,496 shares outstanding at
December 31, 2021; 257,164,867 shares
issued and 257,096,408 shares outstanding at
March 31, 2022
|
|
|
3,693,027
|
|
|
3,269,887
|
|
Additional paid-in
capital
|
|
|
199,482
|
|
|
196,385
|
|
Accumulated other
comprehensive income
|
|
|
39,584
|
|
|
110,358
|
|
Treasury shares: 70,662
and 68,459 shares at December 31, 2021 and March 31, 2022,
respectively
|
|
|
-
|
|
|
-
|
|
Retained
earnings
|
|
|
3,056,845
|
|
|
3,177,778
|
|
Total Waste Connections'
equity
|
|
|
6,988,938
|
|
|
6,754,408
|
|
Noncontrolling interest
in subsidiaries
|
|
|
4,607
|
|
|
4,651
|
|
Total equity
|
|
|
6,993,545
|
|
|
6,759,059
|
|
|
|
$
|
14,699,924
|
|
$
|
15,414,362
|
|
WASTE CONNECTIONS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED
MARCH 31, 2021 AND 2022
(Unaudited)
(in thousands of U.S.
dollars)
|
|
|
|
|
|
Three months ended March 31,
|
|
|
|
2021
|
|
2022
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
160,307
|
|
$
|
180,368
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Loss on disposal of assets and impairments
|
|
|
401
|
|
|
2,090
|
|
Depreciation
|
|
|
157,402
|
|
|
179,950
|
|
Amortization of intangibles
|
|
|
32,192
|
|
|
37,635
|
|
Deferred income taxes, net of acquisitions
|
|
|
8,379
|
|
|
38,378
|
|
Current period provision for expected credit
losses
|
|
|
1,915
|
|
|
3,022
|
|
Amortization of debt issuance costs
|
|
|
1,359
|
|
|
1,195
|
|
Share-based compensation
|
|
|
10,307
|
|
|
14,635
|
|
Interest accretion
|
|
|
4,204
|
|
|
4,448
|
|
Payment of contingent consideration recorded in
earnings
|
|
|
(520)
|
|
|
-
|
|
Adjustments to contingent consideration
|
|
|
89
|
|
|
(52)
|
|
Other
|
|
|
(796)
|
|
|
382
|
|
Net
change in operating assets and liabilities, net of
acquisitions
|
|
|
25,157
|
|
|
(21,154)
|
|
Net cash provided by
operating activities
|
|
|
400,396
|
|
|
440,897
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Payments for acquisitions, net of cash acquired
|
|
|
(8,545)
|
|
|
(355,212)
|
|
Capital expenditures for property and equipment
|
|
|
(96,793)
|
|
|
(152,318)
|
|
Proceeds from disposal of assets
|
|
|
2,080
|
|
|
15,012
|
|
Other
|
|
|
2,705
|
|
|
2,637
|
|
Net cash used in
investing activities
|
|
|
(100,553)
|
|
|
(489,881)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Proceeds from long-term debt
|
|
|
-
|
|
|
1,305,288
|
|
Principal payments on notes payable and long-term
debt
|
|
|
(5,559)
|
|
|
(505,597)
|
|
Payment of contingent consideration recorded at acquisition
date
|
|
|
(4,807)
|
|
|
(3,571)
|
|
Change in book overdraft
|
|
|
(16,849)
|
|
|
87
|
|
Payments for repurchase of common shares
|
|
|
(65,999)
|
|
|
(424,999)
|
|
Payments for cash dividends
|
|
|
(53,909)
|
|
|
(59,391)
|
|
Tax
withholdings related to net share settlements of equity-based
compensation
|
|
|
(18,490)
|
|
|
(17,236)
|
|
Debt issuance costs
|
|
|
-
|
|
|
(4,382)
|
|
Proceeds from issuance of shares under employee share
purchase plan
|
|
|
-
|
|
|
1,554
|
|
Proceeds from sale of common shares held in trust
|
|
|
131
|
|
|
305
|
|
Net cash provided by
(used in) financing activities
|
|
|
(165,482)
|
|
|
292,058
|
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
|
|
403
|
|
|
595
|
|
Net increase in cash,
cash equivalents and restricted cash
|
|
|
134,764
|
|
|
243,669
|
|
Cash, cash equivalents
and restricted cash at beginning of period
|
|
|
714,389
|
|
|
219,615
|
|
Cash, cash equivalents
and restricted cash at end of period
|
|
$
|
849,153
|
|
$
|
463,284
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADDITIONAL
STATISTICS
(in thousands of U.S.
dollars, except where noted)
|
|
|
|
Solid Waste Internal
Growth: The following table reflects a breakdown of the
components of our solid waste internal growth for the three months
ended March 31, 2022:
|
|
|
|
|
|
Three months
ended March
31, 2022
|
|
|
|
Core Price
|
|
6.3
|
%
|
|
|
|
|
|
Surcharges
|
|
0.8
|
%
|
|
|
|
|
|
Volume
|
|
0.5
|
%
|
|
|
|
|
|
Recycling
|
|
1.1
|
%
|
|
|
|
|
|
Foreign Exchange
Impact
|
|
-
|
|
|
|
|
|
|
Total
|
|
8.7
|
%
|
|
|
|
|
|
Revenue
Breakdown: The following table reflects a breakdown of our
revenue for the three month periods ended March 31, 2021 and
2022:
|
|
|
|
Three months ended March 31,
2021
|
|
|
Revenue
|
|
Inter-company
Elimination
|
|
Reported
Revenue
|
|
%
|
Solid Waste
Collection
|
|
$
|
1,036,472
|
|
$
|
(3,045)
|
|
$
|
1,033,427
|
|
74.0%
|
Solid Waste Disposal
and Transfer
|
|
|
461,259
|
|
|
(190,446)
|
|
|
270,813
|
|
19.4%
|
Solid Waste
Recycling
|
|
|
32,448
|
|
|
(993)
|
|
|
31,455
|
|
2.3%
|
E&P Waste
Treatment, Recovery and Disposal
|
|
|
28,012
|
|
|
(3,343)
|
|
|
24,669
|
|
1.8%
|
Intermodal and
Other
|
|
|
35,634
|
|
|
(56)
|
|
|
35,578
|
|
2.5%
|
Total
|
|
$
|
1,593,825
|
|
$
|
(197,883)
|
|
$
|
1,395,942
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended March 31, 2022
|
|
|
Revenue
|
|
Inter-company
Elimination
|
|
Reported
Revenue
|
|
%
|
Solid Waste
Collection
|
|
$
|
1,199,452
|
|
$
|
(2,883)
|
|
$
|
1,196,569
|
|
72.7%
|
Solid Waste Disposal
and Transfer
|
|
|
517,722
|
|
|
(213,019)
|
|
|
304,703
|
|
18.5%
|
Solid Waste
Recycling
|
|
|
63,094
|
|
|
(2,573)
|
|
|
60,521
|
|
3.7%
|
E&P Waste
Treatment, Recovery and Disposal
|
|
|
43,555
|
|
|
(2,732)
|
|
|
40,823
|
|
2.5%
|
Intermodal and
Other
|
|
|
45,693
|
|
|
(2,054)
|
|
|
43,639
|
|
2.6%
|
Total
|
|
$
|
1,869,516
|
|
$
|
(223,261)
|
|
$
|
1,646,255
|
|
100.0%
|
Contribution from
Acquisitions: The following table reflects revenues from
acquisitions, net of divestitures, for the three month periods
ended March 31, 2021 and 2022:
|
|
|
|
Three months
ended
March 31,
|
|
|
2021
|
|
2022
|
Acquisitions,
net
|
|
$
|
40,542
|
|
$
|
110,007
|
ADDITIONAL STATISTICS
(continued)
(in thousands of U.S.
dollars, except where noted)
|
|
Other Cash Flow
Items: The following table reflects cash interest and cash
taxes for the three month periods ended March 31, 2021 and
2022:
|
|
|
|
Three months
ended
March 31,
|
|
|
2021
|
|
2022
|
Cash Interest
Paid
|
|
$
|
25,446
|
|
$
|
32,159
|
Cash Taxes
Paid
|
|
|
28,621
|
|
|
17,389
|
Debt to Book
Capitalization as of March 31, 2022: 46%
Internalization
for the three months ended March 31, 2022:
56%
Days Sales
Outstanding for the three months ended March 31,
2022: 40 (24 net of deferred revenue)
Share Information
for the three months ended March 31, 2022:
|
|
Basic shares
outstanding
|
|
258,946,933
|
Dilutive effect of
equity-based awards
|
|
614,050
|
Diluted shares
outstanding
|
|
259,560,983
|
NON-GAAP
RECONCILIATION SCHEDULE
(in thousands of U.S.
dollars, except where noted)
|
|
Reconciliation of
Adjusted EBITDA:
|
|
Adjusted EBITDA, a
non-GAAP financial measure, is provided supplementally because it
is widely used by investors as a performance and valuation measure
in the solid waste industry. Management uses adjusted EBITDA
as one of the principal measures to evaluate and monitor the
ongoing financial performance of Waste Connections'
operations. Waste Connections defines adjusted EBITDA as net
income attributable to Waste Connections, plus or minus net income
(loss) attributable to noncontrolling interests, plus income tax
provision, plus interest expense, less interest income, plus
depreciation and amortization expense, plus closure and
post-closure accretion expense, plus or minus any loss or gain on
impairments and other operating items, plus other expense, less
other income. Waste Connections further adjusts this
calculation to exclude the effects of other items management
believes impact the ability to assess the operating performance of
its business. This measure is not a substitute for, and
should be used in conjunction with, GAAP financial measures.
Other companies may calculate adjusted EBITDA
differently.
|
|
|
|
Three months
ended
March 31,
|
|
|
2021
|
|
2022
|
Net income attributable
to Waste Connections
|
|
$
|
160,309
|
|
$
|
180,324
|
Plus/(Less): Net income
(loss) attributable to noncontrolling interests
|
|
|
(2)
|
|
|
44
|
Plus: Income tax
provision
|
|
|
40,291
|
|
|
48,839
|
Plus: Interest
expense
|
|
|
42,425
|
|
|
41,324
|
Less: Interest
income
|
|
|
(1,103)
|
|
|
(137)
|
Plus: Depreciation and
amortization
|
|
|
189,594
|
|
|
217,585
|
Plus: Closure and
post-closure accretion
|
|
|
3,709
|
|
|
4,096
|
Plus: Impairments and
other operating items
|
|
|
634
|
|
|
1,878
|
Plus/(Less): Other
expense (income), net
|
|
|
(3,548)
|
|
|
3,466
|
Adjustments:
|
|
|
|
|
|
|
Plus: Transaction-related expenses(a)
|
|
|
526
|
|
|
4,540
|
Plus: Fair value changes to equity
awards(b)
|
|
|
339
|
|
|
161
|
Adjusted
EBITDA
|
|
$
|
433,174
|
|
$
|
502,120
|
|
|
|
|
|
|
|
As % of
revenues
|
|
|
31.0%
|
|
|
30.5%
|
|
|
|
(a)
Reflects the addback of acquisition-related transaction
costs.
(b) Reflects fair value accounting changes associated
with certain equity awards.
|
NON-GAAP
RECONCILIATION SCHEDULE (continued)
(in thousands of U.S.
dollars, except where noted)
|
|
Reconciliation of
Adjusted Free Cash Flow:
Adjusted free cash
flow, a non-GAAP financial measure, is provided supplementally
because it is widely used by investors as a valuation and liquidity
measure in the solid waste industry. Management uses adjusted
free cash flow as one of the principal measures to evaluate and
monitor the ongoing financial performance of Waste Connections'
operations. Waste Connections defines adjusted free cash flow
as net cash provided by operating activities, plus or minus change
in book overdraft, plus proceeds from disposal of assets, less
capital expenditures for property and equipment and distributions
to noncontrolling interests. Waste Connections further
adjusts this calculation to exclude the effects of items management
believes impact the ability to assess the operating performance of
its business. This measure is not a substitute for, and
should be used in conjunction with, GAAP liquidity or financial
measures. Other companies may calculate adjusted free cash
flow differently.
|
|
|
|
Three months
ended
March 31,
|
|
|
|
2021
|
|
2022
|
|
Net cash provided by
operating activities
|
|
$
|
400,396
|
|
$
|
440,897
|
|
Plus/Less: Change in
book overdraft
|
|
|
(16,849)
|
|
|
87
|
|
Plus: Proceeds from
disposal of assets
|
|
|
2,080
|
|
|
15,012
|
|
Less: Capital
expenditures for property and equipment
|
|
|
(96,793)
|
|
|
(152,318)
|
|
Adjustments:
|
|
|
|
|
|
|
|
Payment of contingent consideration recorded in
earnings(a)
|
|
|
520
|
|
|
-
|
|
Cash received for divestitures(b)
|
|
|
-
|
|
|
(5,671)
|
|
Transaction-related expenses(c)
|
|
|
526
|
|
|
23,404
|
|
Pre-existing Progressive Waste share-based
grants(d)
|
|
|
97
|
|
|
76
|
|
Tax
effect(e)
|
|
|
(188)
|
|
|
(1,110)
|
|
Adjusted free cash flow
|
|
$
|
289,789
|
|
$
|
320,377
|
|
|
|
|
|
|
|
|
|
As % of revenues
|
|
|
20.8%
|
|
|
19.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Reflects the addback of
acquisition-related payments for contingent consideration that were
recorded as expenses in earnings and as a component of cash flows
from operating activities as the amounts paid exceeded the fair
value of the contingent consideration recorded at the acquisition
date.
|
(b)
|
Reflects the
elimination of cash received in conjunction with the divestiture of
certain operations.
|
(c)
|
Reflects the addback of
acquisition-related transaction costs and the settlement of an
acquired tax liability.
|
(d)
|
Reflects the cash
settlement of pre-existing Progressive Waste share-based awards
during the period.
|
(e)
|
The aggregate tax
effect of footnotes (a) through (d) is calculated based on the
applied tax rates for the respective periods.
|
NON-GAAP
RECONCILIATION SCHEDULE (continued)
(in thousands of U.S.
dollars, except per share amounts)
|
|
Reconciliation of
Adjusted Net Income attributable to Waste Connections and Adjusted
Net Income per Diluted Share attributable to Waste
Connections:
Adjusted net income
attributable to Waste Connections and adjusted net income per
diluted share attributable to Waste Connections, both non-GAAP
financial measures, are provided supplementally because they are
widely used by investors as a valuation measure in the solid waste
industry. Management uses adjusted net income attributable to
Waste Connections and adjusted net income per diluted share
attributable to Waste Connections as one of the principal measures
to evaluate and monitor the ongoing financial performance of Waste
Connections' operations. Waste Connections provides adjusted
net income attributable to Waste Connections to exclude the effects
of items management believes impact the comparability of operating
results between periods. Adjusted net income attributable to
Waste Connections has limitations due to the fact that it excludes
items that have an impact on the Company's financial condition and
results of operations. Adjusted net income attributable to
Waste Connections and adjusted net income per diluted share
attributable to Waste Connections are not a substitute for, and
should be used in conjunction with, GAAP financial measures.
Other companies may calculate these non-GAAP financial measures
differently.
|
|
|
|
Three months
ended
March 31,
|
|
|
2021
|
|
2022
|
Reported net income
attributable to Waste Connections
|
|
$
|
160,309
|
|
$
|
180,324
|
Adjustments:
|
|
|
|
|
|
|
Amortization of intangibles(a)
|
|
|
32,192
|
|
|
37,635
|
Impairments and other operating
items(b)
|
|
|
634
|
|
|
1,878
|
Transaction-related expenses(c)
|
|
|
526
|
|
|
4,540
|
Fair value changes to equity awards(d)
|
|
|
339
|
|
|
161
|
Tax
effect(e)
|
|
|
(8,543)
|
|
|
(11,092)
|
Adjusted net income attributable to Waste
Connections
|
|
$
|
185,457
|
|
$
|
213,446
|
Diluted earnings per
common share attributable to Waste
Connections' common shareholders:
|
|
|
|
|
|
|
Reported net income
|
|
$
|
0.61
|
|
$
|
0.69
|
Adjusted net income
|
|
$
|
0.70
|
|
$
|
0.82
|
|
|
|
|
|
|
|
(a)
|
Reflects the
elimination of the non-cash amortization of acquisition-related
intangible assets.
|
(b)
|
Reflects the addback of
impairments and other operating items.
|
(c)
|
Reflects the addback of
acquisition-related transaction costs.
|
(d)
|
Reflects fair value
accounting changes associated with certain equity
awards.
|
(e)
|
The aggregate tax
effect of the adjustments in footnotes (a) through (d) is
calculated based on the applied tax rates for the respective
periods.
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/waste-connections-reports-first-quarter-2022-results-301538901.html
SOURCE Waste Connections, Inc.