WASTE CONNECTIONS REPORTS FOURTH QUARTER 2024 RESULTS AND PROVIDES 2025 OUTLOOK

PR Newswire

TORONTO, Feb. 12, 2025

Fourth Quarter and Full Year 2024 Highlights

   -- Strong finish to the year led by solid execution and accelerating 
      improvement in operating trends in the fourth quarter, providing momentum 
      for 2025 
 
   -- Full year 2024 revenue of $8.920 billion, up 11.2% year over year 
 
   -- Net income(a) of $617.6 million, adjusted net income(b) of $1.239 billion, 
      and adjusted EBITDA(b) of $2.902 billion, up 15.0%, and 32.5% of revenue, 
      up 100 basis points year over year 
 
   -- Net cash provided by operating activities of $2.229 billion and adjusted 
      free cash flow(b) of $1.218 billion 
 
   -- Record year of private company acquisitions of approximately $750 million 
      in annualized revenue 

Expectations for 2025

   -- Revenue in the range of $9.45 billion to $9.60 billion 
 
   -- Net income of $1.186 billion to $1.224 billion and adjusted EBITDA(b) 
      margin expansion of up to 80 basis points, or 33.3% 
 
   -- Net cash provided by operating activities in the range of $2.500 billion 
      to $2.575 billion and adjusted free cash flow(b) of between $1.300 
      billion and $1.350 billion, or over $1.550 billion on a normalized basis 
 
   -- Ongoing acquisition-related dialogue with strong pipeline, along with 
      expectations for improving commodity-driven revenues, position for high 
      end of range or above 

TORONTO, Feb. 12, 2025 /PRNewswire/ -- Waste Connections, Inc. (TSX/NYSE: WCN) ("Waste Connections" or the "Company") today announced its results for the fourth quarter of 2024 and outlook for 2025.

"Q4 provided a solid finish to a year of extraordinary accomplishments for Waste Connections both financially, with double-digit growth in both revenue and adjusted EBITDA(b) , and operationally, with accelerating improvements in employee engagement and retention, along with the integration of record levels of private company acquisition activity, which totaled approximately $750 million in annualized revenues in 2024," said Ronald J. Mittelstaedt, President and Chief Executive Officer.

"Our differentiated results in 2024 include 100 basis points adjusted EBITDA(b) margin expansion for industry-leading margin of 32.5% led by 7% solid waste core price complemented by outsized acquisition contribution," added Mr. Mittelstaedt. "Most importantly, our continued focus on human capital resulted in multi-year lows for employee turnover, now down over one thousand basis points from 2022, setting up for continued outsized margin expansion."

Mr. Mittelstaedt concluded, "We are extremely pleased by our industry-leading results in 2024 driven by approximately 24,000 dedicated employees whose efforts truly set us apart as we continued to execute on a proven playbook. We are well-positioned for another year of outsized growth in 2025 from price-led organic solid waste growth, with improving commodities and ongoing acquisition activity positioning us at or above the high end of our range of potential outcomes and normalized adjusted free cash flow(b) in excess of $1.550 billion. With year-end leverage of less than 2.7 times, the strength of our balance sheet continues to provide tremendous optionality to fund outsized acquisition activity and invest in sustainability-related projects, along with an increasing return of capital to shareholders."

Q4 2024 Results

Revenue in the fourth quarter totaled $2.260 billion, up from $2.036 billion in the year ago period. Operating loss was $199.2 million, which included $601.6 million in impairments primarily related to the early closure of a landfill and adjustments to landfill closure and post-closure costs, and $0.9 million from transaction-related expenses. This compares to operating income of $224.5 million in the fourth quarter of 2023, which included $172.5 million primarily in impairments associated with adjustments to landfill closure and post-closure costs and transaction-related expenses. Net loss in the fourth quarter was $196.0 million, or $0.76 per share on a diluted basis of 258.8 million shares. In the year ago period, the Company reported net income of $126.8 million, or $0.49 per share on a diluted basis of 258.3 million shares.

Adjusted net income(b) in the fourth quarter was $300.6 million, or $1.16 per diluted share, up from $285.5 million, or $1.11 per diluted share, in the prior year period. Adjusted EBITDA(b) in the fourth quarter was $731.9 million, as compared to $656.0 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 transaction-related items, as reflected in the detailed reconciliations in the attached tables.

Full Year 2024 Results

For the year ended December 31, 2024, revenue was $8.920 billion, up from $8.022 billion in the year ago period. Operating income was $1.068 billion, which included $613.0 million in impairments primarily related to the early closure of a landfill and closure and post-closure costs, $26.1 million in transaction-related expenses and $1.6 million in fair value changes to certain equity awards. In the year ago period, operating income was $1.236 billion, which included $263.8 million primarily from impairments and other operating items attributable to landfill closure and post-closure costs, transaction-related expenses and executive separation costs.

Net income for the year ended December 31, 2024 was $617.6 million, or $2.39 per share on a diluted basis of 258.7 million shares. In the year ago period, the Company reported net income of $762.8 million, or $2.95 per share on a diluted basis of 258.1 million shares.

Adjusted net income(b) for the year ended December 31, 2024 was $1.239 billion, or $4.79 per diluted share, as compared to $1.081 billion, or $4.19 per diluted share, in the year ago period. Adjusted EBITDA(b) for the year ended December 31, 2024 was $2.902 billion, up from $2.523 billion in the prior year period.

2025 Outlook

Waste Connections also announced its outlook for 2025, which assumes no change in the current economic environment. The Company's outlook excludes expensing of transaction-related items. The outlook provided below is forward looking, and actual results may differ materially depending on risks and uncertainties detailed at the end of this release and in our periodic filings with the U.S. Securities and Exchange Commission and the securities commissions or similar regulatory authorities in Canada. Certain components of the outlook for 2025 are subject to quarterly fluctuations. See reconciliations in the attached tables.

   -- Revenue is estimated between $9.450 billion and $9.600 billion; 
 
   -- Net income is estimated between $1.186 billion and $1.224 billion; 
 
   -- Adjusted EBITDA(b) margin is estimated between 33.0% and 33.3% of revenue, 
      up 50 to 80 basis points year over year; 
 
   -- Net cash provided by operating activities is estimated between $2.500 
      billion and $2.575 billion; 
 
   -- Capital expenditures are estimated to be between $1.200 billion and 
      $1.225 billion, including $100 million to $150 million for RNG 
      facilities; and 
 
   -- Adjusted free cash flow(b) is estimated between $1.300 billion and $1.350 
      billion. 
 
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 (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. 
 

Q4 2024 Earnings Conference Call

Waste Connections will be hosting a conference call related to fourth quarter earnings on February 13(th) 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, conference call participants can preregister by clicking here. Registered participants will receive dial-in instructions and a personalized code for entry to the conference call. A replay of the conference call will be available until February 20, 2025, by calling 877-344-7529 (within North America) or 412-317-0088 (international) and entering Passcode #2431085.

Waste Connections will be filing a Form 8-K on EDGAR and on SEDAR (as an "Other" document) prior to markets opening on February 13(th) , providing the Company's first quarter 2025 outlook for revenue and adjusted EBITDA(b) .

About Waste Connections

Waste Connections (wasteconnections.com) is an integrated solid waste services company that provides non-hazardous waste collection, transfer and disposal services, including by rail, along with resource recovery primarily through recycling and renewable fuels generation. The Company serves approximately nine million residential, commercial and industrial customers in mostly exclusive and secondary markets across 46 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. and Canada, as well as intermodal services for the movement of cargo and solid waste containers in the Pacific Northwest. 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 and focused 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 and enhancing employee engagement. Visit wasteconnections.com/sustainability for more information and updates on our progress towards targeted achievement.

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