Casella Waste Systems, Inc., a regional solid waste, recycling and resource management services company, reported its financial results for the three month period ended March 31, 2023.
Highlights for the three months ended March 31, 2023:
Revenues were $262.6 million for the quarter, up $28.6 million, or up 12.2 percent, from the same period in 2022.
Overall solid waste pricing for the quarter was up 8.8 percent from the same period in 2022, driven by 8.9 percent higher collection pricing and 9.3 percent higher disposal pricing.
Net income was $3.5 million for the quarter, down $(0.7) million, or down (15.3) percent, from the same period in 2022.
Adjusted EBITDA, a non-GAAP measure, was $50.7 million for the quarter, up $5.1 million, or up 11.2 percent from the same period in 2022.
The company completed the acquisition of a solid waste collection and transfer station company with approximately $12 million of annualized revenues on April 3, 2023.
The company signed an equity purchase agreement on April 21, 2023 to acquire select operations from GFL Environmental Inc.
“I am very pleased with the strong start to the year led by the performance of our solid waste operations, where our operating initiatives and pricing programs helped to expand Adjusted EBITDA margins by over 220 basis points year-over-year for this line-of-business,” said John W. Casella, chairman and chief executive officer of Casella Waste Systems, Inc. “The level of execution in the first quarter reflects the continued focus and agility of our team to outpace cost inflation. Further, we have not experienced meaningful indications of an economic slowdown in our business as solid waste volumes were positive in the quarter and other key operating metrics are stable.”
“While recycling commodity prices have improved sequentially from late 2022 through the first quarter, prices were still down significantly year-over-year in the first quarter and presented an expected headwind to our consolidated performance. Despite this year-over-year decline in commodity prices, our risk mitigation strategies, such as our floating Sustainability Recycling Adjustment (SRA) fee, have helped to limit the negative financial impact. However, we are experiencing recycling commodity price headwinds related to several existing contracts from recent acquisitions that will reset over the next few years. We continue to invest in key recycling infrastructure to help meet the sustainability needs of our customers, including the full retrofit and technology upgrade to our Boston material recovery facility, which will be completed by mid-2023,” Casella said.
For the quarter, revenues were $262.6 million, up $28.6 million, or up 12.2 percent, from the same period in 2022, with revenue growth mainly driven by: positive collection and disposal pricing; higher SRA and solid waste fuel cost recovery fees; the roll-over impact from acquisitions closed in the fiscal year ended December 31, 2022; higher pricing, recycling processing fees and volume within our Resource Solutions operating segment; and higher solid waste volumes; partially offset by lower recycling commodity prices.
Net income was $3.5 million for the quarter, or $0.07 per diluted common share, down $(0.7) million, or down (15.3) percent, as compared to net income of $4.2 million, or $0.08 per diluted common share, for the same period in 2022. Adjusted Net Income, a non-GAAP measure, was $5.3 million for the quarter, or $0.10 Adjusted Diluted Earnings Per Common Share, a non-GAAP measure, down $(0.5) million, or down (8.6) percent, as compared to Adjusted Net Income of $5.8 million, or $0.11 Adjusted Diluted Earnings Per Common Share, for the same period in 2022.
Operating income was $10.3 million for the quarter, up $0.1 million, or up 1.0 percent, from the same period in 2022. Adjusted EBITDA was $50.7 million for the quarter, up $5.1 million, or up 11.2 percent, from the same period in 2022.
As published in June 2023 issue of American Recycler.