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Waste Industries USA, Inc. Reports
First Quarter 2008 Financial Results
RALEIGH, N.C., May 1 /PRNewswire-FirstCall/ -- Waste Industries USA,
Inc. (
NASDAQ:WWIN
) , a regional, non-hazardous solid waste services company, today reported
preliminary financial results for the quarter ended March 31, 2008.
Revenue increased 5.4% to $85.7 million, compared to $81.3
million for the quarter ended March 31, 2007. Operating income for the
quarter increased 7.7% to $12.3 million, compared to $11.4 million for the
same period in 2007. Operating income as a percentage of revenue increased
to 14.4% for the first quarter 2008 from 14.0% for the same period in
2007. The 2008 first quarter results include approximately $0.7 million of
fees related to the proposed going private transaction ($0.4 million, net
of income taxes, or $0.03 per diluted share).
Income from continuing operations for the quarter was $5.6
million, or $0.39 per diluted share, a 2.8% increase from income from
continuing operations of $5.4 million, or $0.39 per diluted share, for the
first quarter of 2007. Net income for the quarter was $5.6 million, or
$0.39 per diluted share, compared to net income of $5.6 million, or $0.40
per diluted share, for the first quarter of 2007.
Jim W. Perry, President and CEO of the Company, stated,
"Keys to our results for the quarter were our continuing efforts to
improve operating efficiencies, internalize more of our waste volume and
adjust our pricing to meet the changing service requirements of our
customers. Our near-term focus will continue to be on ways to improve our
productivity, add more customers to existing routes, and leverage our
overall cost structure."
Waste Industries USA, Inc. is a vertically integrated
solid waste services company that provides collection, transfer, disposal
and recycling services to commercial, industrial and residential customer
locations in the states of North Carolina, South Carolina, Virginia,
Tennessee, Mississippi and Georgia.
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
(Unaudited)
Three Months Ended
March 31,
2007 2008
Revenues:
Service revenues $81,110 $85,499
Equipment sales 176 187
Total revenues 81,286 85,686
Operating costs and expenses:
Operating (exclusive of depreciation and
amortization shown below) 49,841 52,917
Cost of equipment sales 91 102
Selling, general and administrative 11,795 12,101
Depreciation and amortization 8,137 8,584
(Gain) loss on sale of property,
equipment and other assets 2 (320)
Total operating costs and expenses 69,866 73,384
Operating income 11,420 12,302
Interest expense 2,419 1,990
Interest income (28) (46)
Other (income) expense (92) 92
Total other expense, net 2,299 2,036
Income from continuing operations
before income taxes 9,121 10,266
Income tax expense 3,687 4,679
Income from continuing operations 5,434 5,587
Discontinued operations:
Income from discontinued operations,
net of income taxes 147 -
Net income $5,581 $5,587
Earnings per share:
Basic:
Income from continuing operations $0.39 $0.39
Income from discontinued operations 0.01 -
Net income $0.40 $0.39
Diluted:
Income from continuing operations $0.39 $0.39
Income from discontinued operations 0.01 -
Net income $0.40 $0.39
Weighted-Average Number Of Shares
Outstanding:
Basic 13,999 14,169
Diluted 14,123 14,265
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
(Unaudited)
December 31, March 31,
2007 2008
ASSETS
Current assets:
Cash and cash equivalents $4,361 $8,200
Receivables, net 35,129 34,352
Other 5,942 9,149
Total current assets 45,432 51,701
Property and equipment, net 234,034 240,882
Intangible assets, net 118,766 120,495
Other noncurrent assets 10,801 7,554
Total assets $409,033 $420,632
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt $7,143 $7,143
Accounts payable - trade 15,703 14,899
Other accrued liabilities and
deferred revenues 28,165 33,323
Total current liabilities 51,011 55,365
Long-term debt, net of current
maturities 157,926 158,355
Deferred taxes and related
contingencies 27,121 27,113
Other liabilities 9,586 11,202
Total liabilities 245,644 252,035
Shareholders' equity: 163,389 168,597
Total liabilities and
shareholders' equity $409,033 $420,632
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
Three Months Ended
March 31,
2007 2008
Operating Activities:
Net income $5,581 $5,587
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 8,137 8,584
Landfill accretion expense 130 132
Amortization of debt issuance costs 102 104
(Gain) loss on sale of property
and equipment and other assets 2 (320)
Stock compensation expense 158 137
Deferred income taxes 253 215
Change in fair value of commodity hedges 1,070 388
Provision for doubtful accounts 412 717
Changes in operating assets and
liabilities, net of effects from
acquisition and disposition of related
businesses 4,766 3,187
Net cash provided by
operating activities 20,611 18,731
Investing Activities:
Acquisitions of operations (5,746) (4,531)
Purchases of property and equipment (4,538) (13,886)
Proceeds from sale of property and
equipment and other assets 417 475
Other (173) 2,660
Net cash used in investing
activities (10,040) (15,282)
Financing Activities:
Proceeds from issuance of long-term debt 8,000 18,000
Principal payments of long-term debt (19,674) (17,571)
Principal payments of capital lease
obligations (85) (47)
Excess tax benefit from stock option
exercises 91 2
Net proceeds from exercise of stock options 807 6
Net cash (used in) provided by
financing activities (10,861) 390
(Decrease) increase in cash and
cash equivalents (290) 3,839
Cash and cash equivalents, beginning of
period 1,656 4,361
Cash and cash equivalents, end of period $1,366 $8,200
Supplemental disclosures of cash flow
information:
Cash paid for interest $2,846 $2,221
Cash paid for taxes $154 $663
EARNINGS RELEASE - SUPPLEMENTAL DATA (dollars in thousands)
QUARTER ENDED
REVENUE MARGINS 3/31/07 3/31/08
Operating expenses including cost of
equipment sales 61.4% 61.9%
S G & A 14.5% 14.1%
Depreciation and amortization 10.0% 10.0%
Interest expense, (net) 2.9% 2.3%
Income from continuing operations (pre-tax) 11.2% 12.0%
Income tax expense 4.5% 5.5%
Income from continuing operations 6.7% 6.5%
SERVICE REVENUE MIX
Collection:
Industrial $21,824 $20,069
Commercial 23,159 24,965
Residential 19,803 21,084
Disposal and transfer 11,549 10,853
Recycling service 1,102 1,122
Recycled commodity sales 318 1,278
Convenience sites 1,652 1,401
Other 1,703 4,727
Total Service Revenue $81,110 $85,499
OPERATING INCOME BEFORE DEPRECIATION,
AMORTIZATION AND ACCRETION*
Operating income $11,420 $12,302
Accretion 130 132
Depreciation and amortization 8,137 8,584
Operating income before depreciation,
amortization and accretion $19,687 $21,018
CAPITAL EXPENDITURES DETAIL
Collection & Transportation $3,732 $8,784
Landfill Development 806 5,102
Total capital expenditures $4,538 $13,886
FREE CASH FLOW RECONCILIATION *
Net cash provided by operating activities $20,611 $18,731
Less: Capital expenditures (4,538) (13,886)
Plus: Proceeds from disposal of assets 417 475
Free cash flow $16,490 $5,320
EARNINGS RELEASE - SUPPLEMENTAL DATA (dollars in thousands)
QUARTER ENDED
DEBT TO TOTAL CAPITAL 12/31/07 3/31/08
(includes capital leases) 50.3% 50.0%
TOTAL LIABILITIES TO EQUITY 1.5 1.5
DAYS SALES OUTSTANDING 32 31
SERVICE REVENUE GROWTH Q1 2008
Price 1.0%
Volume -2.3%
Energy surcharge 2.3%
Total internal growth 1.0%
Recycling commodities 1.2%
Acquisitions 3.2%
Total service revenue growth 5.4%
* Operating income before depreciation, amortization and accretion and
free cash flow are considered non-GAAP financial measures. The Company
defines free cash flow as cash flows from operating activities less
capital expenditures plus proceeds from the sale of property and
equipment and other assets. Operating income before depreciation,
amortization and accretion and free cash flow do not represent, and
should not be considered as, an alternative to net income or cash flows
from operating, investing and financing activities, each as determined
in accordance with GAAP. The Company's definition of operating income
before depreciation, amortization and accretion and free cash flow might
not be comparable to similarly titled measures reported by other
companies. The Company believes that the presentation of operating
income before depreciation, amortization and accretion is useful to
investors because it provides important information of the Company's
operating performance exclusive of certain non-cash costs. The Company
has included information concerning free cash flow because it believes
it provides additional information for determining its ability to meet
debt service requirements and that this measure is an indicator upon
which the Company, its lenders and some investors assess its financial
performance and its capacity to service debt. The Company therefore
interprets free cash flow trends as a measure of its liquidity.
Source: Waste Industries USA, Inc.
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