Casella Waste Systems, Inc. (Nasdaq:CWST), a regional solid waste,
recycling and resource management services company, today reported
financial results for the quarter and fiscal year ended April 30,
2014. The company also announced its plan to change to a December
31st fiscal year-end, and shared guidance for the 8-month
transition period ending December 31, 2014, and its 12-month fiscal
year ending December 31, 2015.
Fourth Quarter and Fiscal Year 2014 Financial
Highlights
- Revenue growth for the current quarter was $10.2
million, or 9.4 percent, from the same quarter last year. For
fiscal year 2014, revenue growth was $42.3 million, or 9.3 percent,
from the same period last year.
- Overall solid waste pricing growth for the fourth
quarter was 0.5 percent, primarily driven by positive collection
pricing growth of 1.5 percent as a percentage of collection
revenues.
- Adjusted EBITDA* was $19.0 million for the current
quarter, down $0.4 million from the same quarter last year. For
fiscal year 2014, Adjusted EBITDA was $95.1 million, up $7.3
million from the same period last year.
- Free Cash Flow* for fiscal year 2014, was $1.3 million,
up $13.5 million from the same period last year.
"We made excellent progress against our long-term goals during
the fiscal year," said John W. Casella, chairman and CEO of Casella
Waste Systems, said. "We delivered on each of our major strategic
priorities – getting additional volumes into our landfills,
improving collection route profitability, furthering our long-term
Eastern region strategy to improve our business positioning and
margins, and driving high-return revenue growth through our
customer solutions offerings. As a result, Adjusted EBITDA and Free
Cash flow were both up significantly year-over-year."
"While we're happy with our progress, we still have quite a bit
of work to do as a team over the next few years to drive higher
cash flows and returns for our investors," Casella said.
For the current quarter, revenues were $118.9 million, up $10.2
million, or 9.4 percent, from the same quarter last year, with
revenue growth mainly driven by higher solid waste volumes, higher
solid waste collection pricing, customer solutions growth, and
acquisition activity. Overall solid waste pricing growth of 0.5
percent was primarily driven by residential and commercial pricing
growth of 2.2 percent as a percentage of segment revenues.
Operating loss was ($6.0) million for the current quarter,
compared to operating income of $2.1 million from the same quarter
last year. The current quarter includes a $7.5 million non-cash
asset impairment charge related to the shutdown of the C.A.R.E.S
water treatment facility in early May 2014, $0.4 million of
severance and reorganization costs, and a $1.1 million non-cash
gain on the settlement of contingent consideration related to the
acquisition of an industrial services company in September
2013.
By comparison, the quarter ended April 30, 2013, included $0.2
million of severance and reorganization costs related to the sale
of the Maine Energy Recovery Company, LP facility and other
realignment activities, $0.4 million of expenses related to the
divestiture of Maine Energy and the acquisition of Bestway Disposal
Services and Blow Brothers Inc, $0.7 million of legal expenses
related to the settlement of the New York State income tax matter,
and a $0.4 million reversal of a previously estimated loss on the
divestiture of Maine Energy.
Excluding these charges, Adjusted Operating Income* in the
current quarter was $0.8 million, down $2.3 million from same
quarter last year.
The company's net loss attributable to common stockholders was
($11.8) million, or ($0.30) per share for the current quarter,
compared to ($13.4) million, or ($0.34) per share for the same
quarter last year. In addition to the unusual items identified
above, the quarter last year included a $3.7 million loss from
discontinued operations related to the disposal of the company's
only construction and demolition processing business.
For fiscal year 2014, revenues were $497.6 million, up $42.3
million, or 9.3 percent, from the same period last year. Operating
income was $11.9 million for fiscal year 2014, down $0.5 million
from the same period last year. Adjusted Operating Income* was
$20.8 million for fiscal year 2014, up $2.6 million from the same
period last year. The company's net loss attributable to common
stockholders was ($23.1) million, or ($0.58) per share for fiscal
year 2014, compared to ($54.1) million, or ($1.59) per share for
the same period last year. Adjusted EBITDA* was $95.1 million for
fiscal year 2014, up $7.3 million from the same period last
year.
Company Plans to Change Fiscal Year to Calendar Year
End
"We got off to a great start in the first seven months of fiscal
year 2014, but experienced challenging operating conditions due to
severe winter weather in our third and fourth quarters," Casella
said. "An extended winter, and subsequently delayed spring, pushed
our seasonal upswing into mid-April, and caused several jobs to
move into next fiscal year."
"The challenges we had this winter, and the unpredictability of
our seasonal upswing, illuminated the need for us to adjust our
fiscal year to better align it with our business cycle," Casella
said. "Putting our seasonally weak period at the beginning of our
fiscal year gives us flexibility to better manage our business in a
number of areas from costs to capital expenditures, and allows us
more runway to make adjustments through the fiscal year."
The company said that it is implementing a plan to change its
fiscal year end from April 30th to December 31st, effective January
1, 2015. Under this change, the company will report an 8-month
transition period ending December 31, 2014, and then subsequently
its full fiscal year ending December 31, 2015. During the 8-month
transition period, the company will report for the quarters ending
July 31, 2014 and October 31, 2014.
Outlook
"Our plan for the 8-month transition period and the 12 months
ended December 31, 2015, assumes that economic activity in the
northeast remains flat, with limited GDP growth, and no major
market changes."
The company provided guidance for its 8-month transition period,
which began May 1, 2014 and ends on December 31, 2014, by
estimating results in the following ranges:
- Revenues between $356.0 million and $366.0 million
(representing growth of 4.7 percent to 7.6 percent), as compared to
$340.1 million for the 8-month period ended December 31, 2013;
- Adjusted EBITDA* between $71.0.0 million and $75.0 million, as
compared to $72.1 million for the 8-month period ended December 31,
2013;
- Capital Expenditures of approximately $50.0 million (including
roughly $13.0 million of capital associated with new contracts and
infrastructure development), payments on operating leases of
roughly $5.0 million, and capping, closure and environmental
remediation payments of roughly $9.0 million.
The company provided the following assumptions that are built
into its 8 month transition period outlook:
- No material changes in the regional economy from fiscal year
2014.
- In the solid waste business, revenue growth of between 3.0
percent and 5.0 percent, with price growth from 1.0 percent to 2.0
percent; volumes growth from 1.0 percent to 2.0 percent; and the
roll-over impact of acquisitions contributing roughly 1.0 percent.
We are estimating that landfill volumes increase by approximately
150,000 tons.
- In the recycling business, overall revenue declines of between
2.5 percent and 7.5 percent, driven by lower commodity price and
volumes.
- In the Other segment, revenue growth of between 20.0 percent
and 25.0 percent, principally due to growth in the Customer
Solutions group.
- No acquisitions beyond the above-mentioned roll-over impact of
the acquisitions completed during fiscal year 2014 are
included.
In addition, the company provided guidance for its next full
fiscal year, which will run from January 1, 2015 through December
31, 2015, by estimating results in the following ranges:
- Revenues between $520.0 million and $530.0 million;
- Adjusted EBITDA* between $103.0 million and $107.0 million; and
- Free Cash Flow* between $14.0 million and $18.0 million.
*Non-GAAP Financial Measures
In addition to disclosing financial results prepared in
accordance with Generally Accepted Accounting Principles in the
United States (GAAP), the company also discloses earnings before
interest, taxes, depreciation and amortization, adjusted for
accretion, depletion of landfill operating lease obligations, gain
on sale of assets, development project charge write-offs, 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, as well as losses on
divestiture (Adjusted EBITDA) which is a non-GAAP measure. The
company also discloses earnings before interest, taxes, adjusted
for gain on sale of assets, development project charge write-offs,
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, as well as losses on
divestiture (Adjusted Operating Income) which is a non-GAAP
measure. The company also discloses Free Cash Flow, which is
defined as net cash provided by operating activities, less capital
expenditures (excluding acquisition related capital expenditures),
less payments on landfill operating leases, less assets acquired
through financing leases, plus proceeds from the sale of property
and equipment, plus contributions from non-controlling interest
holders, which is a non-GAAP measure. Adjusted EBITDA and
Adjusted Operating Income are reconciled to net income (loss),
while Free Cash Flow is reconciled to net cash provided by
operating activities.
The company presents Adjusted EBITDA, Adjusted Operating Income,
and 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 the company's "core
operating performance." The company believes its "core operating
performance" represents its on-going performance in the ordinary
course of operations. The company believes that providing Adjusted
EBITDA, Adjusted Operating Income and 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 may look in the future.
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 such as
interest coverage, leverage and debt incurrence.
Non-GAAP financial measures are not in accordance with or an
alternative for GAAP. Adjusted EBITDA, Adjusted Operating
Income, and 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, or Free Cash Flow presented by other
companies.
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.
Conference call to discuss quarter
The Company will host a conference call to discuss these results
on Thursday, June 26, 2014 at 10:00 a.m. ET. Individuals
interested in participating in the call should dial (877) 548-9590
or (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 60192807) until 11:59
p.m. ET on Thursday, July 3, 2014.
Safe Harbor Statement
Certain matters discussed in this press release 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," "will," "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 we operate and management's beliefs and assumptions. We
cannot guarantee that we actually will achieve the plans,
intentions, expectations or guidance disclosed in the
forward-looking statements made. Such forward-looking statements,
and all phases of our 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 our 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 our revenues and our
operating margin; current economic conditions that have adversely
affected and may continue to adversely affect our revenues and our
operating margin; we may be unable to increase volumes at our
landfills or improve our route profitability; our need to service
our indebtedness may limit our ability to invest in our business;
we 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 our control; we may be required to incur capital
expenditures in excess of our estimates; fluctuations in energy
pricing or the commodity pricing of our recyclables may make it
more difficult for us to predict our results of operations or meet
our estimates; and we may incur environmental charges or asset
impairments in the future. There are a number of other important
risks and uncertainties that could cause our 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
our Form 10-K for the year ended April 30, 2013.
We undertake 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 |
(In thousands, except
amounts per share) |
|
|
|
|
|
|
Three
Months Ended |
Fiscal Year Ended |
|
April 30, |
April 30, |
April 30, |
April 30, |
|
2014 |
2013 |
2014 |
2013 |
|
(Unaudited) |
(Unaudited) |
|
|
|
|
|
|
|
Revenues |
$ 118,927 |
$ 108,694 |
$ 497,633 |
$ 455,335 |
|
|
|
|
|
Operating expenses: |
|
|
|
|
Cost of operations |
88,028 |
78,147 |
354,592 |
323,014 |
General and administration |
15,000 |
14,804 |
61,865 |
58,205 |
Depreciation and
amortization |
15,078 |
13,332 |
60,339 |
56,576 |
Asset impairment charge |
7,455 |
-- |
7,455 |
-- |
Severance and reorganization
costs |
426 |
246 |
586 |
3,709 |
Expense from divestiture,
acquisition and financing costs |
18 |
408 |
144 |
1,410 |
Environmental remediation
charge |
-- |
-- |
400 |
-- |
Development project charge |
(47) |
-- |
1,394 |
-- |
Gain on settlement of
acquisition related contingent consideration |
(1,058) |
-- |
(1,058) |
-- |
Reversal of loss on
divestiture |
-- |
(353) |
-- |
-- |
|
124,900 |
106,584 |
485,717 |
442,914 |
|
|
|
|
|
Operating (loss) income |
(5,973) |
2,110 |
11,916 |
12,421 |
|
|
|
|
|
Other expense/(income), net: |
|
|
|
|
Interest expense, net |
9,523 |
9,081 |
37,863 |
41,429 |
(Gain) loss from equity method
investments |
(62) |
1,131 |
936 |
4,441 |
Gain on sale of equity method
investment |
-- |
-- |
(593) |
-- |
Loss on derivative
instruments |
72 |
640 |
280 |
4,512 |
Loss on debt
extinguishment |
-- |
-- |
-- |
15,584 |
Other income |
(397) |
(298) |
(1,059) |
(1,036) |
Other expense, net |
9,136 |
10,554 |
37,427 |
64,930 |
|
|
|
|
|
Loss from continuing operations before income
taxes and discontinued operations |
(15,109) |
(8,444) |
(25,511) |
(52,509) |
Provision (benefit) for income taxes |
524 |
1,373 |
1,799 |
(2,526) |
|
|
|
|
|
Loss from continuing operations before
discontinued operations |
(15,633) |
(9,817) |
(27,310) |
(49,983) |
|
|
|
|
|
Discontinued operations: |
|
|
|
|
(Loss) income from discontinued
operations, net of income taxes (1) |
-- |
(3,700) |
284 |
(4,480) |
Loss on disposal of
discontinued operations, net of income taxes (1) |
-- |
-- |
(378) |
-- |
|
|
|
|
|
Net loss |
(15,633) |
(13,517) |
(27,404) |
(54,463) |
|
|
|
|
|
Less: Net loss
attributable to noncontrolling interests |
(3,818) |
(120) |
(4,309) |
(321) |
|
|
|
|
|
Net loss attributable to common
stockholders |
$ (11,815) |
$ (13,397) |
$ (23,095) |
$ (54,142) |
|
|
|
|
|
Weighted average common shares
outstanding |
39,916 |
39,515 |
39,820 |
34,015 |
|
|
|
|
|
Net loss per common share |
$ (0.30) |
$ (0.34) |
$ (0.58) |
$ (1.59) |
|
|
|
|
|
Adjusted EBITDA (2) |
$ 19,038 |
$ 19,355 |
$ 95,109 |
$ 87,842 |
|
|
CASELLA WASTE SYSTEMS,
INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED
BALANCE SHEETS |
(In
thousands) |
|
|
|
|
April 30, |
April 30, |
ASSETS |
2014 |
2013 |
|
|
|
CURRENT ASSETS: |
|
|
Cash and cash equivalents |
$ 2,464 |
$ 1,755 |
Restricted cash |
76 |
76 |
Accounts receivable - trade,
net of allowance for doubtful accounts |
52,603 |
48,689 |
Other current assets |
15,662 |
14,025 |
Total current assets |
70,805 |
64,545 |
|
|
|
Property, plant and equipment, net of
accumulated depreciation and amortization |
403,424 |
422,502 |
Goodwill |
119,139 |
115,928 |
Intangible assets, net |
13,420 |
11,674 |
Restricted assets |
681 |
545 |
Notes receivable - related party |
-- |
147 |
Investments in unconsolidated entities |
16,752 |
20,252 |
Other non-current assets |
25,676 |
27,526 |
|
|
|
Total assets |
$ 649,897 |
$ 663,119 |
|
|
|
LIABILITIES AND STOCKHOLDERS'
(DEFICIT) EQUITY |
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
Current maturities of long-term
debt and capital leases |
$ 885 |
$ 1,218 |
Accounts payable |
51,788 |
51,974 |
Other accrued liabilities |
37,073 |
34,906 |
Total current liabilities |
89,746 |
88,098 |
|
|
|
Long-term debt and capital leases, less
current maturities |
507,134 |
494,987 |
Other long-term liabilities |
61,554 |
64,583 |
|
|
|
Total stockholders' (deficit) equity |
(8,537) |
15,451 |
|
|
|
Total liabilities and stockholders' (deficit)
equity |
$ 649,897 |
$ 663,119 |
|
|
|
|
|
|
CASELLA WASTE SYSTEMS,
INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS |
(In
thousands) |
|
|
|
|
Fiscal Year Ended |
|
April 30, |
April 30, |
|
2014 |
2013 |
Cash Flows from Operating
Activities: |
|
|
Net loss |
$ (27,404) |
$ (54,463) |
(Income) loss from discontinued
operations, net |
(284) |
4,480 |
Loss on disposal of discontinued
operations, net |
378 |
-- |
Adjustments to reconcile net loss to
net cash provided by operating activities -- |
|
|
Gain on sale of property
and equipment |
(840) |
(407) |
Depreciation and
amortization |
60,339 |
56,576 |
Depletion of landfill
operating lease obligations |
9,948 |
9,372 |
Interest accretion on
landfill and environmental remediation liabilities |
3,985 |
3,675 |
Asset impairment
charge |
7,455 |
-- |
Development project
charge |
1,394 |
-- |
Gain on settlement of
acquisition related contingent consideration |
(1,058) |
-- |
Amortization of discount
on senior subordinated notes and second lien notes |
243 |
626 |
Loss from equity method
investments |
936 |
4,441 |
Gain on sale of equity
method investment |
(593) |
-- |
Loss on derivative
instruments |
280 |
4,512 |
Loss on debt
extinguishment |
-- |
15,584 |
Stock-based compensation
expense and related severance expense |
2,404 |
2,516 |
Excess tax benefit on the
vesting of share based awards |
-- |
(96) |
Deferred income
taxes |
1,579 |
(3,543) |
Changes in assets and
liabilities, net of effects of acquisitions and
divestitures |
(9,120) |
633 |
Net Cash
Provided by Operating Activities |
49,642 |
43,906 |
Cash Flows from Investing
Activities: |
|
|
Acquisitions, net of cash
acquired |
(8,305) |
(25,225) |
Acquisition related
additions to property, plant and equipment |
(2,633) |
(1,746) |
Additions to property,
plant and equipment |
(43,326) |
(53,281) |
Payments on landfill
operating lease contracts |
(6,505) |
(6,261) |
Payment for capital
related to divestiture |
-- |
(618) |
Investments in
unconsolidated entities |
(2,107) |
(3,207) |
Proceeds from sale of
equity method investment |
3,442 |
-- |
Proceeds from sale of
property and equipment |
1,524 |
883 |
Net Cash
Used In Investing Activities |
(57,910) |
(89,455) |
Cash Flows from Financing
Activities: |
|
|
Proceeds from long-term
borrowings |
161,650 |
376,346 |
Principal payments on
long-term debt |
(152,380) |
(360,858) |
Payment of tender premium
and costs on second lien notes |
-- |
(10,743) |
Payments of financing
costs |
(405) |
(4,609) |
Net proceeds from the
sale of Class A common stock |
-- |
42,184 |
Proceeds from the
exercise of share based awards |
143 |
-- |
Excess tax benefit on the
vesting of share based awards |
-- |
96 |
Contributions from
noncontrolling interest holders |
-- |
2,531 |
Net Cash
Provided By Financing Activities |
9,008 |
44,947 |
Net Cash
Used In Discontinued Operations |
(31) |
(2,177) |
Net increase (decrease) in cash and
cash equivalents |
709 |
(2,779) |
Cash and cash equivalents, beginning of
period |
1,755 |
4,534 |
Cash and cash equivalents, end of
period |
$ 2,464 |
$ 1,755 |
|
|
|
Supplemental Disclosures: |
|
|
Cash interest |
$ 35,162 |
$ 41,348 |
Cash income taxes, net of
refunds |
$ 532 |
$ (253) |
Property, plant and equipment acquired
through lease obligations |
$ 2,301 |
$ -- |
|
|
|
|
|
|
CASELLA WASTE SYSTEMS,
INC. AND SUBSIDIARIES |
NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS |
(In
thousands) |
|
|
|
|
|
|
|
|
|
Note 1: Discontinued
Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In the fourth quarter of fiscal
year 2013, we initiated a plan to dispose of KTI BioFuels, Inc.
("BioFuels"), a construction and demolition material processing
facility located in Lewiston, Maine, and as a result, the assets
associated with BioFuels were classified as held-for-sale and the
results of operations were recorded as loss from discontinued
operations. Assets of the disposal group previously classified as
held-for-sale, and included in discontinued operations as of April
30, 2013, include certain inventory along with plant and equipment.
In the first quarter of fiscal year 2014, we executed a purchase
and sale agreement with ReEnergy Lewiston LLC ("ReEnergy"),
pursuant to which we agreed to sell certain assets of BioFuels,
which was located in our Eastern region, to ReEnergy. We agreed to
sell the BioFuels assets for undiscounted purchase consideration of
$2,000, which is being paid to us in equal quarterly installments
over five years commencing November 1, 2013, subject to the terms
of the purchase and sale agreement. We recognized a $378 loss on
disposal of discontinued operations in the first quarter of fiscal
year 2014 associated with the disposition. |
The operating results of these
operations, including those related to prior years, have been
reclassified from continuing to discontinued operations in the
accompanying consolidated financial statements. Revenues and loss
before income taxes attributable to discontinued operations for
fiscal year 2014, 2013 and 2012, respectively, are as
follows: |
|
|
Fiscal Year Ended April 30, |
|
2014 |
2013 |
2012 |
Revenues |
$ 3,316 |
$ 12,033 |
$ 12,865 |
Income (loss) before income taxes |
$ 284 |
$ (4,480) |
$ (1,025) |
|
|
|
|
|
|
|
|
|
Note 2: Non - GAAP Financial
Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In addition to disclosing
financial results prepared in accordance with Generally Accepted
Accounting Principles in the United States (GAAP), we also disclose
earnings before interest, taxes, depreciation and amortization,
adjusted for accretion, depletion of landfill operating lease
obligations, gain on sale of assets, development project charge
write-offs, 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 settlement
of acquisition related contingent consideration, as well as losses
on divestiture (Adjusted EBITDA), which is a non-GAAP measure. We
also disclose earnings before interest, taxes, adjusted for gain on
sale of assets, development project charge write-offs, legal
settlement charges, 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 settlement of acquisition
related contingent consideration, as well as losses on divestiture
(Adjusted Operating Income), which is a non-GAAP measure. We also
disclose Free Cash Flow, which is defined as net cash provided by
operating activities, less capital expenditures (excluding
acquisition related capital expenditures), less payments on
landfill operating leases, less assets acquired through financing
leases, plus proceeds from the sale of property and equipment, plus
contributions from noncontrolling interest holders, which is a
non-GAAP measure. Adjusted EBITDA and Adjusted Operating Income are
reconciled to net income (loss), while Free Cash Flow is reconciled
to net cash provided by operating activities. |
We present Adjusted EBITDA,
Adjusted Operating Income, and Free Cash Flow because we consider
them important supplemental measures of our performance and believe
they are frequently used by securities analysts, investors and
other interested parties in the evaluation of our results. We use
these non-GAAP measures to further understand our "core operating
performance." We believe our "core operating performance"
represents our on-going performance in the ordinary course of
operations. We believe that providing Adjusted EBITDA, Adjusted
Operating Income, and Free Cash Flow to investors, in addition to
corresponding income statement and cash flow statement measures,
affords investors the benefit of viewing our performance using the
same financial metrics that our management team uses in making many
key decisions and understanding how the core business and our
results of operations may look in the future. We further believe
that providing this information allows our investors greater
transparency and a better understanding of our core financial
performance. In addition, the instruments governing our
indebtedness use EBITDA (with additional adjustments) to measure
our compliance with covenants such as interest coverage, leverage
and debt incurrence. |
Non-GAAP financial measures are
not in accordance with or an alternative for GAAP. Adjusted EBITDA,
Adjusted Operating Income, and 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, or Free Cash Flow
presented by other companies. |
|
Following is a
reconciliation of Adjusted EBITDA and Adjusted Operating Income to
Net Loss: |
|
|
|
|
|
|
Three
Months Ended |
Fiscal Year Ended |
|
April 30, |
April 30, |
April 30, |
April 30, |
|
2014 |
2013 |
2014 |
2013 |
|
|
|
|
|
Net Loss |
$ (15,633) |
$ (13,517) |
$ (27,404) |
$ (54,463) |
Loss (income) from
discontinued operations, net |
-- |
3,700 |
(284) |
4,480 |
Loss on disposal of
discontinued operations, net |
-- |
-- |
378 |
-- |
Provision (benefit) for
income taxes |
524 |
1,373 |
1,799 |
(2,526) |
Other (income) expense,
net |
(387) |
1,473 |
(436) |
23,501 |
Interest expense,
net |
9,523 |
9,081 |
37,863 |
41,429 |
Expense from divestiture,
acquisition and financing costs |
18 |
408 |
144 |
1,410 |
Depreciation and
amortization |
15,078 |
13,332 |
60,339 |
56,576 |
Severance and
reorganization costs |
426 |
246 |
586 |
3,709 |
Tax settlement
costs |
-- |
679 |
-- |
679 |
Environmental remediation
charge |
-- |
-- |
400 |
-- |
Reversal of loss on
divestiture |
-- |
(353) |
-- |
-- |
Asset impairment
charge |
7,455 |
-- |
7,455 |
-- |
Gain on settlement of
acquisition related contingent consideration |
(1,058) |
-- |
(1,058) |
-- |
Development project
charge |
(47) |
-- |
1,394 |
-- |
Depletion of landfill
operating lease obligations |
2,238 |
2,014 |
9,948 |
9,372 |
Interest accretion on
landfill and environmental remediation liabilities |
901 |
919 |
3,985 |
3,675 |
Adjusted EBITDA (2) |
$ 19,038 |
$ 19,355 |
$ 95,109 |
$ 87,842 |
Depreciation and
amortization |
(15,078) |
(13,332) |
(60,339) |
(56,576) |
Depletion of landfill
operating lease obligations |
(2,238) |
(2,014) |
(9,948) |
(9,372) |
Interest accretion on
landfill and environmental remediation liabilities |
(901) |
(919) |
(3,985) |
(3,675) |
Adjusted Operating Income
(2) |
$ 821 |
$ 3,090 |
$ 20,837 |
$ 18,219 |
|
|
|
|
|
Following is a
reconciliation of Free Cash Flow to Net Cash Provided by Operating
Activities: |
|
|
Three
Months Ended |
Fiscal Year Ended |
|
April 30, |
April 30, |
April 30, |
April 30, |
|
2014 |
2013 |
2014 |
2013 |
Net Cash Provided by Operating
Activities |
$ 11,964 |
$ 12,735 |
$ 49,642 |
$ 43,906 |
Capital expenditures |
(9,095) |
(10,493) |
(43,326) |
(53,281) |
Payments on landfill operating lease
contracts |
(453) |
(535) |
(6,505) |
(6,261) |
Proceeds from sale of property and
equipment |
276 |
102 |
1,524 |
883 |
Contributions from noncontrolling interest
holders |
-- |
1,336 |
-- |
2,531 |
Free Cash Flow (2) |
$ 2,692 |
$ 3,145 |
$ 1,335 |
$ (12,222) |
|
|
|
|
|
|
|
|
|
|
CASELLA WASTE SYSTEMS,
INC. AND SUBSIDIARIES |
SUPPLEMENTAL DATA
TABLES |
(Unaudited) |
(In
thousands) |
|
|
|
|
|
Amounts of our total
revenues attributable to services provided for the three and twelve
months ended April 30, 2014 and 2013 are as follows: |
|
|
|
|
|
|
Three
Months Ended April 30, |
|
|
% of Total |
|
% of Total |
|
2014 |
Revenue |
2013 |
Revenue |
Collection |
$ 53,921 |
45.3% |
$ 51,848 |
47.7% |
Disposal |
27,374 |
23.0% |
24,481 |
22.5% |
Power generation |
2,699 |
2.3% |
2,498 |
2.3% |
Processing |
1,683 |
1.4% |
1,751 |
1.6% |
Solid waste
operations |
85,677 |
72.0% |
80,578 |
74.1% |
Organics |
9,701 |
8.2% |
9,358 |
8.6% |
Customer solutions |
12,574 |
10.6% |
8,159 |
7.5% |
Recycling |
10,975 |
9.2% |
10,599 |
9.8% |
Total revenues |
$ 118,927 |
100.0% |
$ 108,694 |
100.0% |
|
|
|
|
|
|
Fiscal Year Ended April 30, |
|
|
% of Total |
|
% of Total |
|
2014 |
Revenue |
2013 |
Revenue |
Collection |
$ 225,441 |
45.3% |
$ 208,973 |
45.9% |
Disposal |
128,778 |
25.9% |
115,049 |
25.3% |
Power generation |
9,512 |
1.9% |
11,354 |
2.4% |
Processing |
8,852 |
1.8% |
6,901 |
1.5% |
Solid waste
operations |
372,583 |
74.9% |
342,277 |
75.1% |
Organics |
37,829 |
7.6% |
35,330 |
7.8% |
Customer solutions |
43,396 |
8.7% |
35,455 |
7.8% |
Recycling |
43,825 |
8.8% |
42,273 |
9.3% |
Total revenues |
$ 497,633 |
100.0% |
$ 455,335 |
100.0% |
|
|
|
|
|
Components of revenue
growth for the three months ended April 30, 2014 compared to the
three months ended April 30, 2013 are as follows: |
|
|
% of Related |
% of Solid Waste |
% of Total |
|
Amount |
Business |
Operations |
Company |
Solid Waste Operations: |
|
|
|
|
Collection |
$ 787 |
1.5% |
1.0% |
0.7% |
Disposal |
(358) |
-1.5% |
-0.5% |
-0.3% |
Solid Waste Yield |
429 |
|
0.5% |
0.4% |
|
|
|
|
|
Collection |
758 |
|
0.9% |
0.7% |
Disposal |
2,226 |
|
2.8% |
2.1% |
Processing |
139 |
|
0.2% |
0.1% |
Solid Waste Volume |
3,123 |
|
3.9% |
2.9% |
|
|
|
|
|
Fuel surcharge |
(19) |
|
0.0% |
0.0% |
Commodity price & volume |
13 |
|
0.0% |
0.0% |
Acquisitions, net divestitures |
1,554 |
|
1.9% |
1.4% |
Total Solid Waste |
5,099 |
|
6.3% |
4.7% |
|
|
|
|
|
Organics |
343 |
|
|
0.3% |
|
|
|
|
|
Customer Solutions |
4,415 |
|
|
4.1% |
|
|
|
|
|
|
|
|
% of Recycling |
|
Recycling Operations: |
|
|
Operations |
|
Commodity price |
34 |
|
0.3% |
0.0% |
Commodity volume |
33 |
|
0.4% |
0.0% |
Commodity acquisition |
309 |
|
2.9% |
0.3% |
Total Recycling |
376 |
|
3.6% |
0.3% |
|
|
|
|
|
Total Company |
$ 10,233 |
|
|
9.4% |
|
|
|
|
|
Solid Waste Internalization Rates by
Region: |
|
|
|
|
|
|
|
|
|
|
Three
Months Ended April 30, |
Fiscal Year Ended April 30, |
|
2014 |
2013 |
2014 |
2013 |
Eastern region |
51.6% |
55.8% |
52.1% |
54.3% |
Western region |
76.2% |
72.5% |
75.2% |
73.3% |
Solid waste
internalization |
63.6% |
64.2% |
63.6% |
64.5% |
|
|
|
|
|
CASELLA WASTE SYSTEMS,
INC. AND SUBSIDIARIES |
SUPPLEMENTAL DATA
TABLES |
(Unaudited) |
(In
thousands) |
|
|
|
|
|
Components of Capital
Expenditures (1): |
|
|
|
|
|
|
Three
Months Ended April 30, |
Fiscal Year Ended April 30, |
|
2014 |
2013 |
2014 |
2013 |
|
|
|
|
|
Landfill development |
$ 4,171 |
$ 5,696 |
$ 21,252 |
$ 27,310 |
Vehicles, machinery, equipment and
containers |
4,057 |
2,513 |
17,353 |
13,938 |
Facilities |
628 |
2,260 |
3,694 |
11,609 |
Other |
239 |
24 |
1,027 |
424 |
Total Capital
Expenditures |
9,095 |
10,493 |
43,326 |
53,281 |
|
|
|
|
|
(1) Does not include acquisition
related capital expenditures, which are defined as costs of
equipment added directly as a result of new business growth related
to an acquisition. |
|
|
|
|
|
CONTACT: Investors:
Ned Coletta
Chief Financial Officer
(802) 772-2239
Media:
Joseph Fusco
Vice President
(802) 772-2247
http://www.casella.com
Casella Waste Systems (NASDAQ:CWST)
Historical Stock Chart
From Jun 2024 to Jul 2024
Casella Waste Systems (NASDAQ:CWST)
Historical Stock Chart
From Jul 2023 to Jul 2024