DOW JONES NEWSWIRES
Republic Services Inc.'s (RSG) first-quarter net income rose 48%
as the company continued to cut costs after its acquisition of
Allied Waste Industries Inc. in December.
The company also affirmed its projections for 2009 earnings and
cost cutting.
"The field organization has done an excellent job managing costs
through improved efficiency and productivity during the economic
downturn, which has resulted in significant margin expansion," said
Donald W. Slager, president and chief operating officer.
Republic, formed late last year by the merger of the No. 2 and
No. 3 players in waste hauling, faces the challenges of integrating
its operations and navigating the economic slowdown. The new
company, though still smaller than Waste Management Inc. (WMI), has
sold assets to resolve the Justice Department antitrust concerns.
The two companies, which control roughly two-thirds of the
country's landfill business, have been raising prices to make up
for reduced volumes.
In the latest quarter, Republic reported net income of $113
million, compared with $76.1 million a year earlier. However,
per-share earnings fell to 30 cents from 41 cents a share,
reflecting a larger number of shares outstanding. The latest
quarter included pretax charges of $4.9 million for impairments and
losses on the sales of business and $31.3 million for restructuring
charges.
Revenue nearly tripled to $2.06 billion, reflecting the
acquisition of Allied.
Analysts were looking for per-share earnings of 30 cents on
revenue of $2.09 billion, according to a poll by Thomson
Reuters
"During the first quarter, we continued to see positive results
regarding the merger of Republic and Allied," Chairman James E.
O'Connor said. "Thus far, we have captured more than $75 million in
annual run-rate synergy savings. We are well on our way, and remain
confident in our commitment, to secure a total annual savings of at
least $150 million by the end of 2010."
For 2009, Republic still expects to earn $1.70 to $1.75 a share
before items, on revenue of about $8.45 billion. The outlook was
below Wall Street expectations when it was issued in February.
In after-hours trading, Republic shares were recently unchanged
at $21.
-By Jay Miller, Dow Jones Newswires; 201-938-2331;
jay.miller@dowjones.com