Casella Waste Systems, Inc. (NASDAQ:CWST), a regional solid waste,
recycling and resource management services company, today reported
its results for the period ended September 30, 2015.
Highlights for the Three and Nine
Months Ended September 30, 2015:
- Revenues were $146.2 million for the third quarter, up
$4.3 million, or 3.0%, from the same period in 2014. Revenues
year-to-date were $406.5 million, up $14.1 million, or 3.6%, from
the same period in 2014.
- Adjusted EBITDA* was $33.1 million for the third
quarter, up $2.4 million, or 7.8%, from the same period in
2014. Adjusted EBITDA year-to-date was $78.3 million, up $5.9
million, or 8.1%, from the same period in 2014.
- Operating income for the third quarter was $12.7
million, up $2.1 million, or 19.5%, from the same period in
2014. Operating income year-to-date was $27.2 million, up
$20.7 million, or 319.5%, from the same period in
2014.
- Free Cash Flow* for the third quarter was $0.8 million,
up $7.0 million from the same period in 2014. Free Cash Flow
year-to-date was $11.6 million, up $19.8 million from the same
period in 2014.
- Overall solid waste pricing for the third quarter was
up 2.9%, mainly driven by strong residential and commercial
collection pricing up 5.2%.
“During our third quarter, we continued to execute well against
our key strategies of increasing landfill returns, improving
collection route profitability, creating incremental value through
resource solutions, reducing financial and operational risks, and
improving our balance sheet,” said John W. Casella, Chairman and
CEO of Casella Waste Systems. “I am pleased with the third
quarter results and our continued improvement across our key
operating and financial metrics.”
“As a result, we continued to expand Adjusted EBITDA margins, up
roughly 100 bps year-over-year, and we used positive free cash flow
generated on a year-to-date basis to repay debt during the
quarter,” Casella said. “We repurchased and permanently
retired $9.7 million of our 7.75% Senior Subordinated Notes due
2019 during the quarter, demonstrating our commitment to reduce
leverage and accelerate free cash flow generation by retiring our
highest cost debt. With our continued cash flow growth and
debt repayment during the third quarter, we reduced our
consolidated leverage ratio as defined by our ABL Revolver to 4.98x
as of September 30, 2015, down from 5.43x on March 31,
2015.”
“From an operating standpoint, our solid waste pricing programs
continued to gain traction in the quarter with overall solid waste
pricing up 2.9%, driven by strong residential and commercial
pricing up 5.2% and higher pricing in the disposal
line-of-business, with our average landfill price per ton up 3.3%,”
Casella said. “These strong pricing gains were complemented
by further improvements in our operating efficiency programs with
our fleet and routing programs driving lower costs.”
“We continued to have success implementing the
Sustainability/Recycling Adjustment (“SRA”) fee to offset lower
recycling commodity prices and driving higher returns in the
recycling line-of-business,” Casella said. “Through the third
quarter we have rolled out the SRA fee to over 80% of our target
collection customers.”
For the third quarter, revenues were $146.2 million, up $4.3
million, or 3.0%, from the same period in 2014, with revenue growth
mainly driven by strong collection and disposal pricing, continued
growth in solid waste and recycling volumes, partially offset by
lower recycling commodity pricing, lower energy pricing and lower
processing volumes.
Adjusted EBITDA was $33.1 million for the quarter, up $2.4
million, or 7.8%, from the same three-month period in 2014 mainly
driven by strong performance in the collection line-of-business,
where strong pricing and volume growth was complemented by
continued cost controls and operating efficiency programs.
Operating income was $12.7 million for the quarter, up $2.1 million
from the same period in 2014. Adjusted Operating Income* was
$13.2 million, up $2.2 million from the same period in
2014.
The company’s net income attributable to common stockholders was
$2.3 million, or $0.06 per common share for the quarter, compared
to net income of $1.1 million, or $0.03 per common share for the
same period in 2014. The third quarter includes $0.5 million
of proxy contest costs and a $0.3 million loss on debt
extinguishment, while the same period in 2014 included $0.4 million
of other unusual items, primarily relating to fiscal year-end
transition costs.
Free Cash Flow was $0.8 million in the quarter, as compared to
($6.3) million for the same period in 2014. Net cash provided
by operating activities was $16.6 million in the quarter, as
compared to $14.8 million for the same period in 2014.
For the nine months ended September 30, 2015, revenues were
$406.5 million, up $14.1 million, or 3.6%, from the same period in
2014, mainly driven by strong collection pricing and higher
disposal and recycling volumes, partially offset by lower recycling
commodity pricing and lower energy pricing.
Adjusted EBITDA was $78.3 million for the nine month period, up
$5.9 million from the same period in 2014. Operating income
was $27.2 million for the nine month period, up $20.7 million from
the same period in 2014. Adjusted Operating Income was $22.3
million, up $7.2 million from the same period in 2014. The
company’s net loss attributable to common stockholders was ($6.0)
million, or ($0.15) per common share for the nine month period,
compared to ($19.0) million, or ($0.47) per share for the same
period in 2014.
Free Cash Flow was $11.6 million for the nine month period, as
compared to ($8.2) million for the same period in 2014. Net
cash provided by operating activities was $40.5 million for the
nine month period, as compared to $37.3 million for the same period
in 2014.
2015 Outlook
Given the solid performance for the nine months ended September
30, 2015, the company reaffirms its previously provided guidance
for the year ending December 31, 2015 by estimating results in the
following ranges:
- Revenues between $525 million and $535 million;
- Adjusted EBITDA between $103 million and $107 million; and
- Free Cash Flow between $15 million and $19 million.
Conference call to discuss quarter
The company will host a conference call to discuss these results
at 10:00 a.m. Eastern Time on Friday, October 23, 2015.
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
55444991) until 11:59 p.m. ET on Friday, October 30,
2015.
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 should
contact Ned Coletta, Chief Financial Officer at (802) 772-2239;
media should contact Joseph Fusco, Vice President at (802)
772-2247; and anyone may visit the company’s website at
http://www.casella.com.
*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, gains
on asset sales, development project charge write-offs, legal
settlement costs, tax settlement costs, bargain purchase gains,
asset impairment charges, environmental remediation charges,
severance and reorganization costs, (gains) 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, taxes,
adjusted for gains on asset sales, development project charge
write-offs, legal settlement charges, tax settlement costs, bargain
purchase gains, asset impairment charges, environmental remediation
charges, severance and reorganization costs, (gains) 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, less assets acquired through financing leases,
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.
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” is helpful in understanding its ongoing 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 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, 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.
Safe Harbor Statement
Certain matters discussed in this press release, including, but
not limited to, the statements regarding financial results, 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 we operate and management’s beliefs and assumptions. We
cannot guarantee that we 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 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; we may incur environmental charges or asset
impairments in the future; and actions of activist investors and
the cost and disruption of responding to those actions;. 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-KT for the transition period
ended December 31, 2014 and in our Form 10-Q for the quarterly
period ended June 30, 2015.
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 |
|
(Unaudited) |
|
(In thousands, except amounts per
share) |
|
|
|
|
|
|
|
|
|
Three Months
Ended September
30, |
|
Nine Months
Ended September
30, |
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
146,185 |
|
|
$ |
141,924 |
|
|
$ |
406,476 |
|
|
$ |
392,400 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
Cost of operations |
|
|
99,656 |
|
|
|
98,228 |
|
|
|
286,225 |
|
|
|
281,850 |
|
|
General and administration |
|
|
17,448 |
|
|
|
17,211 |
|
|
|
52,324 |
|
|
|
49,192 |
|
|
Depreciation and amortization |
|
|
16,385 |
|
|
|
15,787 |
|
|
|
46,374 |
|
|
|
46,562 |
|
|
Divestiture transactions |
|
|
- |
|
|
|
- |
|
|
|
(5,611 |
) |
|
|
7,455 |
|
|
Development project charge |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,394 |
|
|
Severance and reorganization
costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
430 |
|
|
Environmental remediation
charge |
|
|
- |
|
|
|
75 |
|
|
|
- |
|
|
|
75 |
|
|
Expense from divestiture,
acquisition and financing costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
24 |
|
|
Gain on settlement of acquisition
related contingent consideration |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(1,058 |
) |
|
|
|
|
133,489 |
|
|
|
131,301 |
|
|
|
379,312 |
|
|
|
385,924 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
12,696 |
|
|
|
10,623 |
|
|
|
27,164 |
|
|
|
6,476 |
|
|
|
|
|
|
|
|
|
|
|
|
Other
expense/(income): |
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
10,031 |
|
|
|
9,440 |
|
|
|
30,096 |
|
|
|
28,439 |
|
|
Loss on debt extinguishment |
|
|
345 |
|
|
|
- |
|
|
|
866 |
|
|
|
- |
|
|
Loss (gain) on derivative
instruments |
|
|
41 |
|
|
|
(82 |
) |
|
|
239 |
|
|
|
366 |
|
|
Income from equity method
investments |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(90 |
) |
|
Loss on sale of equity method
investment |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
221 |
|
|
Other income |
|
|
(178 |
) |
|
|
(204 |
) |
|
|
(387 |
) |
|
|
(772 |
) |
|
Other expense, net |
|
|
10,239 |
|
|
|
9,154 |
|
|
|
30,814 |
|
|
|
28,164 |
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes |
|
|
2,457 |
|
|
|
1,469 |
|
|
|
(3,650 |
) |
|
|
(21,688 |
) |
|
Provision for income
taxes |
|
|
198 |
|
|
|
229 |
|
|
|
1,112 |
|
|
|
1,060 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) |
|
|
2,259 |
|
|
|
1,240 |
|
|
|
(4,762 |
) |
|
|
(22,748 |
) |
|
|
|
|
|
|
|
|
|
|
|
Less: Net (loss) income
attributable to noncontrolling interests |
|
|
(37 |
) |
|
|
160 |
|
|
|
1,189 |
|
|
|
(3,750 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to common stockholders |
|
$ |
2,296 |
|
|
$ |
1,080 |
|
|
$ |
(5,951 |
) |
|
$ |
(18,998 |
) |
|
|
|
|
|
|
|
|
|
|
|
Basic
weighted average common shares outstanding |
|
|
40,810 |
|
|
|
40,313 |
|
|
|
40,560 |
|
|
|
40,074 |
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per common share |
|
$ |
0.06 |
|
|
$ |
0.03 |
|
|
$ |
(0.15 |
) |
|
$ |
(0.47 |
) |
|
|
|
|
|
|
|
|
|
|
|
Diluted
weighted average common shares outstanding |
|
|
41,283 |
|
|
|
40,581 |
|
|
|
40,560 |
|
|
|
40,074 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
earnings per common share |
|
$ |
0.06 |
|
|
$ |
0.03 |
|
|
$ |
(0.15 |
) |
|
$ |
(0.47 |
) |
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA |
|
$ |
33,116 |
|
|
$ |
30,716 |
|
|
$ |
78,309 |
|
|
$ |
72,453 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIES |
|
|
|
|
CONDENSED CONSOLIDATED BALANCE
SHEETS |
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
September 30,
2015 |
|
December 31,
2014 |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
2,019 |
|
|
$ |
2,205 |
|
|
|
|
|
Restricted cash |
|
|
- |
|
|
|
76 |
|
|
|
|
|
Accounts receivable - trade, net of
allowance for doubtful accounts |
|
|
63,835 |
|
|
|
55,750 |
|
|
|
|
|
Other current assets |
|
|
19,902 |
|
|
|
20,638 |
|
|
|
|
|
Total current
assets |
|
|
85,756 |
|
|
|
78,669 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment, net of accumulated depreciation and amortization |
|
|
397,378 |
|
|
|
414,542 |
|
|
|
|
|
Goodwill |
|
|
118,976 |
|
|
|
119,170 |
|
|
|
|
|
Intangible assets,
net |
|
|
9,842 |
|
|
|
11,808 |
|
|
|
|
|
Restricted assets |
|
|
5,283 |
|
|
|
6,632 |
|
|
|
|
|
Cost method
investments |
|
|
14,115 |
|
|
|
14,432 |
|
|
|
|
|
Other non-current
assets |
|
|
29,315 |
|
|
|
24,542 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
660,665 |
|
|
$ |
669,795 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
|
|
|
|
Current maturities of long-term
debt and capital leases |
|
$ |
1,306 |
|
|
$ |
1,656 |
|
|
|
|
|
Accounts payable |
|
|
50,106 |
|
|
|
48,518 |
|
|
|
|
|
Other accrued liabilities |
|
|
29,485 |
|
|
|
36,258 |
|
|
|
|
|
Total current
liabilities |
|
|
80,897 |
|
|
|
86,432 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt and
capital leases, less current maturities |
|
|
530,439 |
|
|
|
534,055 |
|
|
|
|
|
Other long-term
liabilities |
|
|
64,885 |
|
|
|
61,328 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders'
deficit |
|
|
(15,556 |
) |
|
|
(12,020 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders'
deficit |
|
$ |
660,665 |
|
|
$ |
669,795 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIES |
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
|
|
|
|
(Unaudited) |
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September
30, |
|
|
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Operating Activities: |
|
|
|
|
|
|
|
|
Net
loss |
|
$ |
(4,762 |
) |
|
$ |
(22,748 |
) |
|
|
|
|
Adjustments to
reconcile net loss to net cash provided by operating activities
- |
|
|
|
|
|
|
|
|
Gain on sale of property and
equipment |
|
|
(137 |
) |
|
|
(349 |
) |
|
|
|
|
Depletion of landfill
operating lease obligations |
|
|
7,019 |
|
|
|
8,104 |
|
|
|
|
|
Interest accretion on
landfill and environmental remediation liabilities |
|
|
2,572 |
|
|
|
2,655 |
|
|
|
|
|
Stock-based compensation
expense |
|
|
2,325 |
|
|
|
1,740 |
|
|
|
|
|
Depreciation and
amortization |
|
|
46,374 |
|
|
|
46,562 |
|
|
|
|
|
Divestiture
transactions |
|
|
(5,611 |
) |
|
|
7,455 |
|
|
|
|
|
Development project
charge |
|
|
- |
|
|
|
1,394 |
|
|
|
|
|
Gain on settlement of
acquisition related contingent consideration |
|
|
- |
|
|
|
(1,058 |
) |
|
|
|
|
Amortization of discount of
long-term debt |
|
|
269 |
|
|
|
190 |
|
|
|
|
|
Loss on debt
extinguishment |
|
|
866 |
|
|
|
- |
|
|
|
|
|
Loss on derivative
instruments |
|
|
239 |
|
|
|
366 |
|
|
|
|
|
Income from equity method
investments |
|
|
- |
|
|
|
(90 |
) |
|
|
|
|
Loss on sale of equity method
investment |
|
|
- |
|
|
|
221 |
|
|
|
|
|
Excess tax benefit on the
vesting of share based awards |
|
|
(179 |
) |
|
|
(14 |
) |
|
|
|
|
Deferred income
taxes |
|
|
627 |
|
|
|
901 |
|
|
|
|
|
Changes in assets and
liabilities, net of effects of acquisitions and
divestitures |
|
|
(9,072 |
) |
|
|
(8,065 |
) |
|
|
|
|
Net Cash Provided by
Operating Activities |
|
|
40,530 |
|
|
|
37,264 |
|
|
|
|
|
Cash Flows from
Investing Activities: |
|
|
|
|
|
|
|
|
Acquisitions, net of cash
acquired |
|
|
- |
|
|
|
(62 |
) |
|
|
|
|
Acquisition related additions
to property, plant and equipment |
|
|
- |
|
|
|
(266 |
) |
|
|
|
|
Additions to property, plant
and equipment |
|
|
(31,038 |
) |
|
|
(43,014 |
) |
|
|
|
|
Payments on landfill
operating lease contracts |
|
|
(2,956 |
) |
|
|
(3,017 |
) |
|
|
|
|
Proceeds from divestiture
transactions |
|
|
5,335 |
|
|
|
- |
|
|
|
|
|
Proceeds from sale of
property and equipment |
|
|
636 |
|
|
|
559 |
|
|
|
|
|
Proceeds from sale of equity
method investment |
|
|
- |
|
|
|
597 |
|
|
|
|
|
Proceeds from property
insurance settlement |
|
|
546 |
|
|
|
- |
|
|
|
|
|
Payments related to
investments |
|
|
- |
|
|
|
(84 |
) |
|
|
|
|
Net Cash Used In Investing
Activities |
|
|
(27,477 |
) |
|
|
(45,287 |
) |
|
|
|
|
Cash Flows from
Financing Activities: |
|
|
|
|
|
|
|
|
Proceeds from long-term
borrowings |
|
|
296,929 |
|
|
|
134,560 |
|
|
|
|
|
Principal payments on
long-term debt |
|
|
(301,220 |
) |
|
|
(126,713 |
) |
|
|
|
|
Change in restricted
cash |
|
|
1,319 |
|
|
|
- |
|
|
|
|
|
Payments of financing
costs |
|
|
(8,991 |
) |
|
|
(24 |
) |
|
|
|
|
Payment of redemption premium
on long-term debt |
|
|
(121 |
) |
|
|
- |
|
|
|
|
|
Proceeds from the exercise of
share based awards |
|
|
161 |
|
|
|
286 |
|
|
|
|
|
Excess tax benefit on the
vesting of share based awards |
|
|
179 |
|
|
|
14 |
|
|
|
|
|
Distribution to
noncontrolling interest holder |
|
|
(1,495 |
) |
|
|
- |
|
|
|
|
|
Net Cash (Used In) Provided
By Financing Activities |
|
|
(13,239 |
) |
|
|
8,123 |
|
|
|
|
|
Net Cash Provided By
Discontinued Operations |
|
|
- |
|
|
|
263 |
|
|
|
|
|
Net (decrease) increase in cash and cash
equivalents |
|
|
(186 |
) |
|
|
363 |
|
|
|
|
|
Cash and cash equivalents, beginning of period |
|
|
2,205 |
|
|
|
2,695 |
|
|
|
|
|
Cash and cash equivalents, end of period |
|
$ |
2,019 |
|
|
$ |
3,058 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures of Cash Flow Information: |
|
|
|
|
|
|
|
|
Cash interest |
|
$ |
33,364 |
|
|
$ |
32,495 |
|
|
|
|
|
Cash income taxes, net of
refunds |
|
$ |
31 |
|
|
$ |
28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Disclosures of Non-Cash Investing and Financing
Activities: |
|
|
|
|
|
|
|
|
Receivable due from
noncontrolling interest holder |
|
$ |
- |
|
|
$ |
152 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASELLA WASTE SYSTEMS, INC. AND
SUBSIDIARIES |
|
RECONCILIATION OF CERTAIN NON-GAAP
MEASURES |
|
(Unaudited) |
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Following is a reconciliation of Adjusted EBITDA and
Adjusted Operating Income to Net Income (Loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended September
30, |
|
Nine Months
Ended September
30, |
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) |
|
$ |
2,259 |
|
|
$ |
1,240 |
|
|
$ |
(4,762 |
) |
|
$ |
(22,748 |
) |
|
Provision for income taxes |
|
|
198 |
|
|
|
229 |
|
|
|
1,112 |
|
|
|
1,060 |
|
|
Other expense (income), net |
|
|
208 |
|
|
|
(286 |
) |
|
|
718 |
|
|
|
(275 |
) |
|
Interest expense, net |
|
|
10,031 |
|
|
|
9,440 |
|
|
|
30,096 |
|
|
|
28,439 |
|
|
Gain on settlement of acquisition
related contingent consideration |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(1,058 |
) |
|
Expense from divestiture,
acquisition and financing costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
24 |
|
|
Severance and reorganization
costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
430 |
|
|
Environmental remediation
charge |
|
|
- |
|
|
|
75 |
|
|
|
|
|
75 |
|
|
Development project charge |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,394 |
|
|
Divestiture transactions |
|
|
- |
|
|
|
- |
|
|
|
(5,611 |
) |
|
|
7,455 |
|
|
Depreciation and amortization |
|
|
16,385 |
|
|
|
15,787 |
|
|
|
46,374 |
|
|
|
46,562 |
|
|
Fiscal year-end transition
costs |
|
|
- |
|
|
|
336 |
|
|
|
- |
|
|
|
336 |
|
|
Proxy contest costs |
|
|
507 |
|
|
|
- |
|
|
|
791 |
|
|
|
- |
|
|
Depletion of landfill operating
lease obligations |
|
|
2,660 |
|
|
|
3,066 |
|
|
|
7,019 |
|
|
|
8,104 |
|
|
Interest accretion on landfill and
environmental remediation liabilities |
|
|
868 |
|
|
|
829 |
|
|
|
2,572 |
|
|
|
2,655 |
|
|
Adjusted EBITDA |
|
$ |
33,116 |
|
|
$ |
30,716 |
|
|
$ |
78,309 |
|
|
$ |
72,453 |
|
|
Depreciation and
amortization |
|
|
(16,385 |
) |
|
|
(15,787 |
) |
|
|
(46,374 |
) |
|
|
(46,562 |
) |
|
Depletion of landfill
operating lease obligations |
|
|
(2,660 |
) |
|
|
(3,066 |
) |
|
|
(7,019 |
) |
|
|
(8,104 |
) |
|
Interest accretion on
landfill and environmental remediation liabilities |
|
|
(868 |
) |
|
|
(829 |
) |
|
|
(2,572 |
) |
|
|
(2,655 |
) |
|
Adjusted Operating
Income |
|
$ |
13,203 |
|
|
$ |
11,034 |
|
|
$ |
22,344 |
|
|
$ |
15,132 |
|
|
|
|
|
|
|
|
|
|
|
|
Following is a reconciliation of Free Cash Flow to Net
Cash Provided by Operating Activities: |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September
30, |
|
Nine Months Ended September
30, |
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
Net Cash Provided By Operating Activities |
|
$ |
16,641 |
|
|
$ |
14,818 |
|
|
$ |
40,530 |
|
|
$ |
37,264 |
|
|
Capital expenditures
(i) |
|
|
(14,727 |
) |
|
|
(19,709 |
) |
|
|
(31,038 |
) |
|
|
(43,014 |
) |
|
Payments on landfill
operating lease contracts |
|
|
(1,531 |
) |
|
|
(1,491 |
) |
|
|
(2,956 |
) |
|
|
(3,017 |
) |
|
Proceeds from
divestiture transactions |
|
|
- |
|
|
|
- |
|
|
|
5,335 |
|
|
|
- |
|
|
Proceeds from sale of
property and equipment |
|
|
377 |
|
|
|
111 |
|
|
|
636 |
|
|
|
559 |
|
|
Proceeds from property
insurance settlement |
|
|
- |
|
|
|
- |
|
|
|
546 |
|
|
|
- |
|
|
Distribution to
noncontrolling interest holder |
|
|
- |
|
|
|
- |
|
|
|
(1,495 |
) |
|
|
- |
|
|
Free Cash
Flow |
|
$ |
760 |
|
|
$ |
(6,271 |
) |
|
$ |
11,558 |
|
|
$ |
(8,208 |
) |
|
|
|
|
|
|
|
|
|
|
|
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 nine months ended September 30, 2015 and
2014 are as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
|
|
|
|
|
2015 |
|
|
% of Total Revenue |
|
|
2014 |
|
|
% of Total Revenue |
|
|
|
Collection |
|
$ |
63,588 |
|
|
|
43.5 |
% |
|
$ |
60,648 |
|
|
|
42.7 |
% |
|
|
|
Disposal |
|
|
43,168 |
|
|
|
29.5 |
% |
|
|
39,561 |
|
|
|
27.9 |
% |
|
|
|
Power generation |
|
|
1,694 |
|
|
|
1.2 |
% |
|
|
1,902 |
|
|
|
1.3 |
% |
|
|
|
Processing |
|
|
1,866 |
|
|
|
1.3 |
% |
|
|
2,818 |
|
|
|
2.0 |
% |
|
|
|
Solid waste
operations |
|
|
110,316 |
|
|
|
75.5 |
% |
|
|
104,929 |
|
|
|
73.9 |
% |
|
|
|
Organics |
|
|
9,753 |
|
|
|
6.6 |
% |
|
|
10,130 |
|
|
|
7.1 |
% |
|
|
|
Customer solutions |
|
|
13,416 |
|
|
|
9.2 |
% |
|
|
13,559 |
|
|
|
9.6 |
% |
|
|
|
Recycling |
|
|
12,700 |
|
|
|
8.7 |
% |
|
|
13,306 |
|
|
|
9.4 |
% |
|
|
|
Total
revenues |
|
$ |
146,185 |
|
|
|
100.0 |
% |
|
$ |
141,924 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
|
|
|
|
|
2015 |
|
|
% of Total Revenue |
|
|
2014 |
|
|
% of Total Revenue |
|
|
|
Collection |
|
$ |
177,550 |
|
|
|
43.7 |
% |
|
$ |
171,559 |
|
|
|
43.7 |
% |
|
|
|
Disposal |
|
|
114,999 |
|
|
|
28.3 |
% |
|
|
101,764 |
|
|
|
25.9 |
% |
|
|
|
Power generation |
|
|
5,305 |
|
|
|
1.3 |
% |
|
|
7,249 |
|
|
|
1.8 |
% |
|
|
|
Processing |
|
|
4,652 |
|
|
|
1.1 |
% |
|
|
7,343 |
|
|
|
1.9 |
% |
|
|
|
Solid waste
operations |
|
|
302,506 |
|
|
|
74.4 |
% |
|
|
287,915 |
|
|
|
73.3 |
% |
|
|
|
Organics |
|
|
29,619 |
|
|
|
7.3 |
% |
|
|
30,121 |
|
|
|
7.7 |
% |
|
|
|
Customer solutions |
|
|
39,895 |
|
|
|
9.8 |
% |
|
|
38,718 |
|
|
|
9.9 |
% |
|
|
|
Recycling |
|
|
34,456 |
|
|
|
8.5 |
% |
|
|
35,646 |
|
|
|
9.1 |
% |
|
|
|
Total
revenues |
|
$ |
406,476 |
|
|
|
100.0 |
% |
|
$ |
392,400 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of revenue growth for the three months
ended September 30, 2015 compared to the three months ended
September 30, 2014 are as follows: |
|
|
|
|
|
|
|
|
|
Amount |
|
% of Related Business |
|
% of Solid Waste Operations |
|
% of Total Company |
|
|
|
Solid Waste
Operations: |
|
|
|
|
|
|
|
|
|
|
|
Collection |
|
$ |
2,624 |
|
|
|
4.3 |
% |
|
|
2.5 |
% |
|
|
1.8 |
% |
|
|
|
Disposal |
|
|
459 |
|
|
|
1.2 |
% |
|
|
0.4 |
% |
|
|
0.3 |
% |
|
|
|
Solid Waste
Yield |
|
|
3,083 |
|
|
|
|
|
2.9 |
% |
|
|
2.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collection |
|
|
605 |
|
|
|
|
|
0.6 |
% |
|
|
0.4 |
% |
|
|
|
Disposal |
|
|
3,225 |
|
|
|
|
|
3.0 |
% |
|
|
2.3 |
% |
|
|
|
Processing |
|
|
(644 |
) |
|
|
|
|
-0.6 |
% |
|
|
-0.5 |
% |
|
|
|
Solid Waste
Volume |
|
|
3,186 |
|
|
|
|
|
3.0 |
% |
|
|
2.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fuel surcharge |
|
|
(176 |
) |
|
|
|
|
-0.2 |
% |
|
|
-0.1 |
% |
|
|
|
Commodity price &
volume |
|
|
(509 |
) |
|
|
|
|
-0.5 |
% |
|
|
-0.3 |
% |
|
|
|
Acquisitions, net
divestitures |
|
|
(133 |
) |
|
|
|
|
-0.1 |
% |
|
|
-0.1 |
% |
|
|
|
Closed
landfill |
|
|
(64 |
) |
|
|
|
|
-0.1 |
% |
|
|
0.0 |
% |
|
|
|
Total Solid
Waste |
|
|
5,387 |
|
|
|
|
|
5.0 |
% |
|
|
3.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organics |
|
|
(377 |
) |
|
|
|
|
|
|
-0.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer
Solutions |
|
|
(143 |
) |
|
|
|
|
|
|
-0.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recycling
Operations: |
|
|
|
|
|
% of Recycling Operations |
|
|
|
|
|
Commodity price |
|
|
(1,390 |
) |
|
|
|
|
-10.4 |
% |
|
|
-1.0 |
% |
|
|
|
Commodity volume |
|
|
784 |
|
|
|
|
|
5.9 |
% |
|
|
0.6 |
% |
|
|
|
Total
Recycling |
|
|
(606 |
) |
|
|
|
|
-4.5 |
% |
|
|
-0.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Company |
|
$ |
4,261 |
|
|
|
|
|
|
|
3.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Solid Waste Internalization Rates by Region for the three
and nine months ended September 30, 2015 and 2014 are as
follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
Eastern region |
|
|
57.5 |
% |
|
|
54.7 |
% |
|
|
50.6 |
% |
|
|
53.5 |
% |
|
|
|
Western region |
|
|
70.9 |
% |
|
|
80.5 |
% |
|
|
72.2 |
% |
|
|
78.7 |
% |
|
|
|
Solid waste
internalization |
|
|
63.8 |
% |
|
|
67.3 |
% |
|
|
60.8 |
% |
|
|
65.8 |
% |
|
|
|
|
|
|
Components of Capital Expenditures for the three and
nine months ended September 30, 2015 and 2014 are as follows
(i): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
Total Growth
Capital Expenditures |
|
$ |
938 |
|
|
$ |
4,025 |
|
|
$ |
3,387 |
|
|
$ |
8,703 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Replacement Capital Expenditures: |
|
|
|
|
|
|
|
|
|
|
|
Landfill development |
|
$ |
6,334 |
|
|
$ |
7,021 |
|
|
$ |
11,952 |
|
|
$ |
16,824 |
|
|
|
|
Vehicles, machinery,
equipment and containers |
|
6,330 |
|
|
|
7,866 |
|
|
|
13,037 |
|
|
|
15,432 |
|
|
|
|
Facilities |
|
|
659 |
|
|
|
619 |
|
|
|
1,162 |
|
|
|
1,453 |
|
|
|
|
Other |
|
|
466 |
|
|
|
178 |
|
|
|
1,500 |
|
|
|
602 |
|
|
|
|
Total
Replacement Capital Expenditures |
|
$ |
13,789 |
|
|
$ |
15,684 |
|
|
$ |
27,651 |
|
|
$ |
34,311 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Growth and Replacement Capital
Expenditures |
$ |
14,727 |
|
|
$ |
19,709 |
|
|
$ |
31,038 |
|
|
$ |
43,014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(i) Our 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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