Delaware | 1-14267 | 65-0716904 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
18500 North Allied Way | ||
Phoenix, Arizona | 85054 | |
(Address of principal executive offices) | (Zip Code) |
Emerging growth company | ¨ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o |
REPUBLIC SERVICES, INC. | |||
Date: | October 25, 2018 | By: | /S/ CHARLES F. SERIANNI |
Charles F. Serianni | |||
Executive Vice President, Chief Financial Officer (Principal Financial Officer) | |||
Date: | October 25, 2018 | By: | /S/ BRIAN A. GOEBEL |
Brian A. Goebel | |||
Vice President and Chief Accounting Officer (Principal Accounting Officer) |
● | Generated Earnings of $0.81 Per Share and Adjusted Earnings of $0.82 Per Share, a 22 Percent Increase Over the Prior Year | |
● | Increased Cash Flow from Operations by $53 million and Adjusted Free Cash Flow by $42 million, a 17 Percent Increase Over the Prior Year | |
● | Solid Waste Business Contributed 80 Basis Points of Adjusted EBITDA Margin Expansion | |
● | Reaffirmed 2018 Adjusted Earnings Per Share and Adjusted Free Cash Flow Guidance | |
● | Provided Preliminary 2019 Financial Outlook | |
● | Named to the Dow Jones Sustainability World and North America Indices for the Third Consecutive Year |
• | Adjusted EPS, a non-GAAP measure, was $0.82 per share, an increase of 22 percent over the prior year. Adjusted EPS included an 8-cent headwind from recycling. |
• | Cash provided by operating activities was $556 million and adjusted free cash flow, a non-GAAP measure, was $289 million, an increase of approximately 17 percent over the prior year. Adjusted free cash flow per share increased 21 percent over the prior year. |
• | Total cash returned to shareholders through dividends and share repurchases was $203 million. |
• | Total revenue increased 4.1 percent over the prior year, excluding the impact of the new revenue standard. |
• | Core price increased revenue by 3.9 percent, an increase of 30 basis points from the second quarter. Core price consisted of 4.6 percent in the open market and 2.8 percent in the restricted portion of the business, an increase of 20 basis points and 50 basis points from the second quarter, respectively. |
• | Revenue growth from average yield was 2.4 percent. Revenue growth from recycling processing fees was an additional 25 basis points. |
• | Customer defection remained below 7 percent for the third quarter in a row. |
• | Adjusted EBITDA, a non-GAAP measure, was $728 million and adjusted EBITDA margin was 28.4 percent of revenue. The solid waste business contributed 80 basis points of margin expansion, which was more than offset by a 150 basis point headwind from the recycling business, excluding the impact of the new revenue standard. |
• | SG&A expense as a percentage of revenue was 10.2 percent, a decrease of 60 basis points over the prior year, excluding the impact of the new revenue standard. |
• | The Company invested $53 million in tuck-in acquisitions, bringing the Company's total year-to-date investment to $133 million. For the full year, the Company expects to invest approximately $200 million in value-enhancing acquisitions. |
• | Republic continued to convert CPI-based contracts to more favorable pricing mechanisms for the annual price adjustment. The Company now has approximately $625 million in annual revenue tied to either a waste-related index or a fixed-rate increase of 3 percent or greater. |
• | The Company was named to both the Dow Jones Sustainability World and North America Indices for the third consecutive year. The rankings highlight Republic's continued leadership in corporate governance, environmental, social and financial sustainability. |
• | Adjusted diluted earnings per share is expected to be in a range of $3.23 to $3.28. This outlook assumes short-term variable interest rates will continue to increase in 2019. For every 100-basis point increase in variable interest rates, annual interest expense would increase approximately $15 million. |
• | Adjusted free cash flow is expected to be in a range of $1,125 million to $1,175 million. In 2019, the Company expects to reinvest $75 million of its tax-reform savings into its fleet and front-line employee facilities, which represents a $50 million increase as compared to 2018. |
Media Inquiries | Investor Inquiries |
Donna Egan (480) 757-9748 | Nicole Giandinoto (480) 627-7098 |
media@RepublicServices.com | investor@RepublicServices.com |
SUPPLEMENTAL UNAUDITED FINANCIAL INFORMATION | |||||||
AND OPERATING DATA | |||||||
REPUBLIC SERVICES, INC. | |||||||
CONSOLIDATED BALANCE SHEETS | |||||||
(in millions, except per share amounts) | |||||||
September 30, | December 31, | ||||||
2018 | 2017 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 81.9 | $ | 83.3 | |||
Accounts receivable, less allowance for doubtful accounts and other of $34.5 and $38.9, respectively | 1,156.0 | 1,105.9 | |||||
Prepaid expenses and other current assets | 254.2 | 247.6 | |||||
Total current assets | 1,492.1 | 1,436.8 | |||||
Restricted cash and marketable securities | 99.1 | 141.1 | |||||
Property and equipment, net | 7,913.9 | 7,777.4 | |||||
Goodwill | 11,382.7 | 11,315.4 | |||||
Other intangible assets, net | 105.4 | 141.1 | |||||
Other assets | 408.9 | 335.2 | |||||
Total assets | $ | 21,402.1 | $ | 21,147.0 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 661.3 | $ | 598.1 | |||
Notes payable and current maturities of long-term debt | 690.8 | 706.7 | |||||
Deferred revenue | 336.4 | 312.1 | |||||
Accrued landfill and environmental costs, current portion | 168.3 | 135.2 | |||||
Accrued interest | 78.4 | 74.5 | |||||
Other accrued liabilities | 740.1 | 808.2 | |||||
Total current liabilities | 2,675.3 | 2,634.8 | |||||
Long-term debt, net of current maturities | 7,556.7 | 7,480.7 | |||||
Accrued landfill and environmental costs, net of current portion | 1,673.9 | 1,686.5 | |||||
Deferred income taxes and other long-term tax liabilities, net | 970.0 | 796.4 | |||||
Insurance reserves, net of current portion | 275.8 | 275.4 | |||||
Other long-term liabilities | 326.6 | 312.1 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Preferred stock, par value $0.01 per share; 50 shares authorized; none issued | — | — | |||||
Common stock, par value $0.01 per share; 750 shares authorized; 351.8 and 350.1 issued including shares held in treasury, respectively | 3.5 | 3.5 | |||||
Additional paid-in capital | 4,911.0 | 4,839.6 | |||||
Retained earnings | 4,571.6 | 4,152.5 | |||||
Treasury stock, at cost; 27.2 and 18.4 shares, respectively | (1,620.4 | ) | (1,059.4 | ) | |||
Accumulated other comprehensive income, net of tax | 55.9 | 22.6 | |||||
Total Republic Services, Inc. stockholders’ equity | 7,921.6 | 7,958.8 | |||||
Noncontrolling interests in consolidated subsidiary | 2.2 | 2.3 | |||||
Total stockholders’ equity | 7,923.8 | 7,961.1 | |||||
Total liabilities and stockholders’ equity | $ | 21,402.1 | $ | 21,147.0 |
REPUBLIC SERVICES, INC. | |||||||||||||||
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||
(in millions, except per share data) | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Revenue | $ | 2,565.7 | $ | 2,562.0 | $ | 7,510.9 | $ | 7,481.5 | |||||||
Expenses: | |||||||||||||||
Cost of operations | 1,577.4 | 1,580.1 | 4,624.4 | 4,621.6 | |||||||||||
Depreciation, amortization and depletion | 262.4 | 260.8 | 781.0 | 769.0 | |||||||||||
Accretion | 20.1 | 20.0 | 60.7 | 59.9 | |||||||||||
Selling, general and administrative | 260.9 | 266.7 | 775.0 | 783.2 | |||||||||||
Withdrawal costs - multiemployer pension funds | — | — | — | 1.1 | |||||||||||
Gain on disposition of assets and asset impairments, net | (4.6 | ) | (17.4 | ) | (5.3 | ) | (27.2 | ) | |||||||
Restructuring charges | 9.2 | 3.7 | 22.5 | 12.2 | |||||||||||
Operating income | 440.3 | 448.1 | 1,252.6 | 1,261.7 | |||||||||||
Interest expense | (96.0 | ) | (90.0 | ) | (287.3 | ) | (269.0 | ) | |||||||
Loss from unconsolidated equity method investment | (5.6 | ) | (2.2 | ) | (5.7 | ) | (8.2 | ) | |||||||
Loss on extinguishment of debt | — | — | (0.3 | ) | — | ||||||||||
Interest income | 0.5 | 0.3 | 1.0 | 1.0 | |||||||||||
Other income, net | 1.1 | 0.5 | 3.3 | 0.9 | |||||||||||
Income before income taxes | 340.3 | 356.7 | 963.6 | 986.4 | |||||||||||
Provision for income taxes | 77.4 | 133.4 | 227.1 | 371.9 | |||||||||||
Net income | 262.9 | 223.3 | 736.5 | 614.5 | |||||||||||
Net loss (income) attributable to noncontrolling interests in consolidated subsidiary | 0.5 | (0.1 | ) | (0.5 | ) | (0.5 | ) | ||||||||
Net income attributable to Republic Services, Inc. | $ | 263.4 | $ | 223.2 | $ | 736.0 | $ | 614.0 | |||||||
Basic earnings per share attributable to Republic Services, Inc. stockholders: | |||||||||||||||
Basic earnings per share | $ | 0.81 | $ | 0.66 | $ | 2.25 | $ | 1.82 | |||||||
Weighted average common shares outstanding | 325.5 | 336.5 | 327.8 | 338.2 | |||||||||||
Diluted earnings per share attributable to Republic Services, Inc. stockholders: | |||||||||||||||
Diluted earnings per share | $ | 0.81 | $ | 0.66 | $ | 2.23 | $ | 1.81 | |||||||
Weighted average common and common equivalent shares outstanding | 326.9 | 338.5 | 329.3 | 340.1 | |||||||||||
Cash dividends per common share | $ | 0.375 | $ | 0.345 | $ | 1.065 | $ | 0.985 |
REPUBLIC SERVICES, INC. | |||||||
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(in millions) | |||||||
Nine Months Ended September 30, | |||||||
2018 | 2017 | ||||||
Cash provided by operating activities: | |||||||
Net income | $ | 736.5 | $ | 614.5 | |||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||
Depreciation, amortization, depletion and accretion | 841.7 | 828.9 | |||||
Non-cash interest expense | 31.4 | 32.6 | |||||
Restructuring related charges | 22.5 | 12.2 | |||||
Stock-based compensation | 29.4 | 27.3 | |||||
Deferred tax provision | 113.7 | 60.5 | |||||
Provision for doubtful accounts, net of adjustments | 24.4 | 22.8 | |||||
Loss on extinguishment of debt | 0.3 | — | |||||
Gain on disposition of assets and asset impairments, net | (1.7 | ) | (22.7 | ) | |||
Withdrawal costs - multiemployer pension funds | — | 1.1 | |||||
Environmental adjustments | 3.3 | — | |||||
Loss from unconsolidated equity method investment | 5.7 | 8.2 | |||||
Other non-cash items | 0.6 | (0.8 | ) | ||||
Change in assets and liabilities, net of effects from business acquisitions and divestitures: | |||||||
Accounts receivable | (72.1 | ) | (149.0 | ) | |||
Prepaid expenses and other assets | (13.5 | ) | (0.8 | ) | |||
Accounts payable | 58.6 | 30.3 | |||||
Restructuring expenditures | (18.7 | ) | (14.6 | ) | |||
Capping, closure and post-closure expenditures | (42.5 | ) | (44.5 | ) | |||
Remediation expenditures | (30.2 | ) | (37.7 | ) | |||
Other liabilities | 26.4 | 13.8 | |||||
Proceeds from retirement of certain hedging relationships | 31.1 | — | |||||
Cash provided by operating activities | 1,746.9 | 1,382.1 | |||||
Cash used in investing activities: | |||||||
Purchases of property and equipment | (820.5 | ) | (769.0 | ) | |||
Proceeds from sales of property and equipment | 7.9 | 4.2 | |||||
Cash used in acquisitions and investments, net of cash acquired | (130.5 | ) | (136.4 | ) | |||
Cash received from (used in) business divestitures | 10.6 | (10.6 | ) | ||||
Purchases of restricted marketable securities | (35.4 | ) | (9.6 | ) | |||
Sales of restricted marketable securities | 36.2 | 9.2 | |||||
Other | — | 0.6 | |||||
Cash used in investing activities | (931.7 | ) | (911.6 | ) | |||
Cash used in financing activities: | |||||||
Proceeds from notes payable and long-term debt, net of fees | 3,296.7 | 3,428.1 | |||||
Proceeds from issuance of senior notes, net of discount and fees | 782.0 | — | |||||
Payments of notes payable and long-term debt and senior notes | (4,032.6 | ) | (3,238.9 | ) | |||
Issuances of common stock, net | 19.9 | 26.7 | |||||
Purchases of common stock for treasury | (574.9 | ) | (353.3 | ) | |||
Cash dividends paid | (340.0 | ) | (324.8 | ) | |||
Distributions paid to noncontrolling interests in consolidated subsidiary | (0.6 | ) | (0.7 | ) | |||
Other | (7.9 | ) | (5.5 | ) | |||
Cash used in financing activities | (857.4 | ) | (468.4 | ) | |||
(Decrease) increase in cash, cash equivalents, restricted cash and restricted cash equivalents | (42.2 | ) | 2.1 | ||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of year | 179.1 | 113.0 | |||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | $ | 136.9 | $ | 115.1 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||||
Collection: | |||||||||||||||||||||||||||
Residential | $ | 562.8 | 21.9 | % | $ | 576.5 | 22.5 | % | $ | 1,671.4 | 22.3 | % | $ | 1,717.2 | 23.0 | % | |||||||||||
Small-container | 772.1 | 30.1 | 752.7 | 29.4 | 2,284.8 | 30.4 | 2,233.5 | 29.9 | |||||||||||||||||||
Large-container | 560.3 | 21.8 | 541.3 | 21.1 | 1,630.8 | 21.7 | 1,565.4 | 20.9 | |||||||||||||||||||
Other | 11.1 | 0.5 | 11.6 | 0.4 | 32.7 | 0.4 | 32.1 | 0.4 | |||||||||||||||||||
Total collection (1) | 1,906.3 | 74.3 | 1,882.1 | 73.4 | 5,619.7 | 74.8 | 5,548.2 | 74.2 | |||||||||||||||||||
Transfer | 322.6 | 312.8 | 931.7 | 907.0 | |||||||||||||||||||||||
Less: intercompany | (178.6 | ) | (178.0 | ) | (529.1 | ) | (531.3 | ) | |||||||||||||||||||
Transfer, net | 144.0 | 5.6 | 134.8 | 5.3 | 402.6 | 5.4 | 375.7 | 5.0 | |||||||||||||||||||
Landfill | 590.2 | 576.1 | 1,720.7 | 1,650.5 | |||||||||||||||||||||||
Less: intercompany | (258.8 | ) | (252.7 | ) | (767.5 | ) | (740.7 | ) | |||||||||||||||||||
Landfill, net | 331.4 | 12.9 | 323.4 | 12.6 | 953.2 | 12.7 | 909.8 | 12.2 | |||||||||||||||||||
Energy services | 51.5 | 2.0 | 40.0 | 1.6 | 149.6 | 2.0 | 103.3 | 1.4 | |||||||||||||||||||
Other: | |||||||||||||||||||||||||||
Recycling processing and commodity sales (2) | 76.0 | 3.0 | 130.5 | 5.1 | 220.0 | 2.9 | 400.4 | 5.3 | |||||||||||||||||||
Other non-core | 56.5 | 2.2 | 51.2 | 2.0 | 165.8 | 2.2 | 144.1 | 1.9 | |||||||||||||||||||
Total other | 132.5 | 5.2 | 181.7 | 7.1 | 385.8 | 5.1 | 544.5 | 7.2 | |||||||||||||||||||
Total revenue | $ | 2,565.7 | 100.0 | % | $ | 2,562.0 | 100.0 | % | $ | 7,510.9 | 100.0 | % | $ | 7,481.5 | 100.0 | % | |||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||
Average yield | 2.4 | % | 2.5 | % | 2.2 | % | 2.5 | % | ||||
Fuel recovery fees | 0.8 | 0.3 | 0.7 | 0.4 | ||||||||
Total price | 3.2 | 2.8 | 2.9 | 2.9 | ||||||||
Volume | (0.1 | ) | 1.6 | 0.8 | 1.5 | |||||||
Recycling processing and commodity sales | (1.0 | ) | 0.7 | (1.2 | ) | 1.4 | ||||||
Energy services | 0.1 | 0.8 | 0.2 | 0.6 | ||||||||
Total internal growth | 2.2 | 5.9 | 2.7 | 6.4 | ||||||||
Acquisitions / divestitures, net | 1.9 | 0.4 | 1.8 | 0.3 | ||||||||
Subtotal | 4.1 | % | 6.3 | % | 4.5 | % | 6.7 | % | ||||
Adoption of the new revenue recognition standard | (4.0 | )% | — | % | (4.1 | )% | — | % | ||||
Total | 0.1 | % | 6.3 | % | 0.4 | % | 6.7 | % | ||||
Core price | 3.9 | % | 4.1 | % | 3.8 | % | 4.1 | % | ||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||
Labor and related benefits | $ | 536.1 | 20.9 | % | $ | 507.6 | 19.8 | % | $ | 1,604.2 | 21.4 | % | $ | 1,502.8 | 20.1 | % | ||||||||||||||||
Transfer and disposal costs | 214.9 | 8.4 | 204.0 | 8.0 | 617.8 | 8.2 | 598.6 | 8.0 | ||||||||||||||||||||||||
Maintenance and repairs | 250.8 | 9.8 | 240.0 | 9.4 | 742.3 | 9.9 | 702.8 | 9.4 | ||||||||||||||||||||||||
Transportation and subcontract costs | 166.5 | 6.5 | 153.1 | 6.0 | 482.3 | 6.4 | 432.1 | 5.8 | ||||||||||||||||||||||||
Fuel | 103.9 | 4.0 | 87.2 | 3.4 | 289.7 | 3.9 | 255.0 | 3.4 | ||||||||||||||||||||||||
Disposal fees and taxes (1) | 82.9 | 3.2 | 120.2 | 4.7 | 240.4 | 3.2 | 348.2 | 4.7 | ||||||||||||||||||||||||
Landfill operating costs | 60.7 | 2.4 | 53.6 | 2.1 | 169.4 | 2.3 | 163.7 | 2.2 | ||||||||||||||||||||||||
Risk management | 52.4 | 2.0 | 58.6 | 2.3 | 160.5 | 2.1 | 162.1 | 2.2 | ||||||||||||||||||||||||
Cost of goods sold (2) | — | — | 57.8 | 2.3 | — | — | 176.1 | 2.4 | ||||||||||||||||||||||||
Other | 109.2 | 4.3 | 98.0 | 3.7 | 317.8 | 4.2 | 280.2 | 3.6 | ||||||||||||||||||||||||
Total cost of operations | $ | 1,577.4 | 61.5 | % | $ | 1,580.1 | 61.7 | % | $ | 4,624.4 | 61.6 | % | $ | 4,621.6 | 61.8 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||
Salaries | $ | 173.9 | 6.8 | % | $ | 176.8 | 6.9 | % | $ | 520.8 | 6.9 | % | $ | 527.0 | 7.0 | % | ||||||||||||||||
Provision for doubtful accounts | 10.8 | 0.4 | 8.0 | 0.3 | 24.4 | 0.3 | 22.8 | 0.3 | ||||||||||||||||||||||||
Other | 76.2 | 3.0 | 81.9 | 3.2 | 229.8 | 3.1 | 233.4 | 3.2 | ||||||||||||||||||||||||
Total selling, general and administrative expenses | $ | 260.9 | 10.2 | % | $ | 266.7 | 10.4 | % | $ | 775.0 | 10.3 | % | $ | 783.2 | 10.5 | % | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income attributable to Republic Services, Inc. | $ | 263.4 | $ | 223.2 | $ | 736.0 | $ | 614.0 | |||||||
Net income attributable to noncontrolling interests | (0.5 | ) | 0.1 | 0.5 | 0.5 | ||||||||||
Provision for income taxes | 77.4 | 133.4 | 227.1 | 371.9 | |||||||||||
Other income, net | (1.1 | ) | (0.5 | ) | (3.3 | ) | (0.9 | ) | |||||||
Interest income | (0.5 | ) | (0.3 | ) | (1.0 | ) | (1.0 | ) | |||||||
Interest expense | 96.0 | 90.0 | 287.3 | 269.0 | |||||||||||
Depreciation, amortization and depletion | 262.4 | 260.8 | 781.0 | 769.0 | |||||||||||
Accretion | 20.1 | 20.0 | 60.7 | 59.9 | |||||||||||
EBITDA | $ | 717.2 | $ | 726.7 | $ | 2,088.3 | $ | 2,082.4 |
Three Months Ended September 30, 2018 | Three Months Ended September 30, 2017 | |||||||||||||||||||||||||||||||
Net | Diluted | Net | Diluted | |||||||||||||||||||||||||||||
Pre-tax | Income - | Earnings | Pre-tax | Income - | Earnings | |||||||||||||||||||||||||||
EBITDA | Income | Republic | per Share | EBITDA | Income | Republic | per Share | |||||||||||||||||||||||||
As reported | $ | 717.2 | $ | 340.3 | $ | 263.4 | $ | 0.81 | $ | 726.7 | $ | 356.7 | $ | 223.2 | $ | 0.66 | ||||||||||||||||
Gain on disposition of assets and asset impairments, net | (4.6 | ) | (4.6 | ) | (2.1 | ) | (0.01 | ) | (17.4 | ) | (17.4 | ) | (2.0 | ) | (0.01 | ) | ||||||||||||||||
Restructuring charges | 9.2 | 9.2 | 7.4 | 0.02 | 3.7 | 3.7 | 2.2 | 0.01 | ||||||||||||||||||||||||
Incremental contract startup costs - large municipal contract (1) | 0.1 | 0.1 | — | — | 2.7 | 2.7 | 1.8 | 0.01 | ||||||||||||||||||||||||
Loss from unconsolidated equity method investment | 5.6 | — | — | — | 2.2 | — | — | — | ||||||||||||||||||||||||
Adoption of the Tax Act (1) | — | — | 0.3 | — | — | — | — | — | ||||||||||||||||||||||||
Total adjustments | 10.3 | 4.7 | 5.6 | 0.01 | (8.8 | ) | (11.0 | ) | 2.0 | 0.01 | ||||||||||||||||||||||
As adjusted | $ | 727.5 | $ | 345.0 | $ | 269.0 | $ | 0.82 | $ | 717.9 | $ | 345.7 | $ | 225.2 | $ | 0.67 |
Nine Months Ended September 30, 2018 | Nine Months Ended September 30, 2017 | |||||||||||||||||||||||||||||||
Net | Diluted | Net | Diluted | |||||||||||||||||||||||||||||
Pre-tax | Income - | Earnings | Pre-tax | Income - | Earnings | |||||||||||||||||||||||||||
EBITDA | Income | Republic | per Share | EBITDA | Income | Republic | per Share | |||||||||||||||||||||||||
As reported | $ | 2,088.3 | $ | 963.6 | $ | 736.0 | $ | 2.23 | $ | 2,082.4 | $ | 986.4 | $ | 614.0 | $ | 1.81 | ||||||||||||||||
Loss on extinguishment of debt and other related costs (1) | 0.3 | 0.3 | 0.2 | — | — | — | — | — | ||||||||||||||||||||||||
Gain on disposition of assets and asset impairments, net | (5.3 | ) | (5.3 | ) | (2.7 | ) | (0.01 | ) | (27.2 | ) | (27.2 | ) | (6.7 | ) | (0.02 | ) | ||||||||||||||||
Restructuring charges | 22.5 | 22.5 | 17.1 | 0.06 | 12.2 | 12.2 | 7.4 | 0.02 | ||||||||||||||||||||||||
Incremental contract startup costs - large municipal contract | 5.4 | 5.4 | 4.1 | 0.01 | 5.0 | 5.0 | 3.0 | 0.01 | ||||||||||||||||||||||||
Withdrawal costs - multiemployer pension funds (2) | — | — | — | — | 1.1 | 1.1 | 0.7 | — | ||||||||||||||||||||||||
Loss from unconsolidated equity method investment | 5.7 | — | — | — | 8.2 | — | — | — | ||||||||||||||||||||||||
Adoption of the Tax Act (1) | — | — | 0.3 | — | — | — | — | — | ||||||||||||||||||||||||
Total adjustments | 28.6 | 22.9 | 19.0 | 0.06 | (0.7 | ) | (8.9 | ) | 4.4 | 0.01 | ||||||||||||||||||||||
As adjusted | $ | 2,116.9 | $ | 986.5 | $ | 755.0 | $ | 2.29 | $ | 2,081.7 | $ | 977.5 | $ | 618.4 | $ | 1.82 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Cash provided by operating activities | $ | 555.9 | $ | 502.9 | $ | 1,746.9 | $ | 1,382.1 | |||||||
Property and equipment received | (277.8 | ) | (252.1 | ) | (803.8 | ) | (783.4 | ) | |||||||
Proceeds from sales of property and equipment | 3.6 | 1.1 | 7.9 | 4.2 | |||||||||||
Restructuring payments, net of tax | 4.9 | 2.3 | 14.2 | 8.9 | |||||||||||
Tax payments related to divestitures | 2.4 | (6.7 | ) | 2.6 | (5.6 | ) | |||||||||
Adjusted free cash flow | $ | 289.0 | $ | 247.5 | $ | 967.8 | $ | 606.2 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Purchases of property and equipment per the unaudited consolidated statements of cash flows | $ | 278.4 | $ | 271.5 | $ | 820.5 | $ | 769.0 | ||||||||
Adjustments to exclude the purchase of property and equipment associated with acquisitions | (13.0 | ) | — | (29.8 | ) | — | ||||||||||
Adjustments for property and equipment received during the prior period but paid for in the following period, net | 12.4 | (19.4 | ) | 13.1 | 14.4 | |||||||||||
Property and equipment received during the period | $ | 277.8 | $ | 252.1 | $ | 803.8 | $ | 783.4 | ||||||||
(Anticipated) Year Ending December 31, 2018 | ||
Diluted earnings per share | $2.98 - $3.03 | |
Withdrawal costs - multiemployer pension funds | — | |
Gain on disposition of assets and asset impairments, net | (0.01 | ) |
Restructuring charges | 0.07 | |
Incremental contract startup costs - large municipal contract | 0.01 | |
Adjusted diluted earnings per share | $3.05 - $3.10 |
(Anticipated) Year Ending December 31, 2018 | ||
Cash provided by operating activities | $ 2,137 - 2,162 | |
Property and equipment received | (1,085 | ) |
Proceeds from the sale of property and equipment | 15 | |
Restructuring payments, net of tax | 20 | |
Divestiture related tax payments | 3 | |
Adjusted free cash flow | $ 1,090 - 1,115 |
(Anticipated) Year Ending December 31, 2018 | |||
Purchases of property and equipment per the unaudited consolidated statements of cash flows | $ | 1,135 | |
Adjustments to exclude the purchase of property and equipment associated with acquisitions | (50 | ) | |
Adjustments for property and equipment received during the prior period but paid for in the following period, net | — | ||
Property and equipment received during the period | $ | 1,085 |
(Preliminary Outlook) Year Ending December 31, 2019 | ||
Diluted earnings per share | $3.22 - $3.27 | |
Restructuring charges | 0.01 | |
Adjusted diluted earnings per share | $3.23 - $3.28 |
Three Months Ended September 30, | |||||||||||||||||||||||
2018 | 2017 | Change | |||||||||||||||||||||
Proforma | |||||||||||||||||||||||
Collection: | |||||||||||||||||||||||
Residential | $ | 562.8 | 21.9 | % | $ | 564.3 | 22.9 | % | $ | (1.5 | ) | (1.0 | ) | % | |||||||||
Small-container | 772.1 | 30.1 | 736.5 | 29.9 | 35.6 | 0.2 | |||||||||||||||||
Large-container | 560.3 | 21.8 | 535.2 | 21.7 | 25.1 | 0.1 | |||||||||||||||||
Other | 11.1 | 0.5 | 11.6 | 0.5 | (0.5 | ) | — | ||||||||||||||||
Total collection | 1,906.3 | 74.3 | 1,847.6 | 75.0 | 58.7 | (0.7 | ) | ||||||||||||||||
Transfer | 322.6 | 306.6 | 16.0 | ||||||||||||||||||||
Less: intercompany | (178.6 | ) | (173.1 | ) | (5.5 | ) | |||||||||||||||||
Transfer, net | 144.0 | 5.6 | 133.5 | 5.4 | 10.5 | 0.2 | |||||||||||||||||
Landfill | 590.2 | 571.7 | 18.5 | ||||||||||||||||||||
Less: intercompany | (258.8 | ) | (252.6 | ) | (6.2 | ) | |||||||||||||||||
Landfill, net | 331.4 | 12.9 | 319.1 | 13.0 | 12.3 | (0.1 | ) | ||||||||||||||||
Energy services | 51.5 | 2.0 | 39.5 | 1.6 | 12.0 | 0.4 | |||||||||||||||||
Other: | |||||||||||||||||||||||
Recycling processing and commodity sales | 76.0 | 3.0 | 73.1 | 3.0 | 2.9 | — | |||||||||||||||||
Other non-core | 56.5 | 2.2 | 51.1 | 2.0 | 5.4 | 0.2 | |||||||||||||||||
Total other | 132.5 | 5.2 | 124.2 | 5.0 | 8.3 | 0.2 | |||||||||||||||||
Total revenue | $ | 2,565.7 | 100.0 | % | $ | 2,463.9 | 100.0 | % | $ | 101.8 | — | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
2018 | 2017 | Change | |||||||||||||||||||||
Proforma | |||||||||||||||||||||||
Collection: | |||||||||||||||||||||||
Residential | $ | 1,671.4 | 22.3 | % | $ | 1,680.9 | 23.4 | % | $ | (9.5 | ) | (1.1 | ) | % | |||||||||
Small-container | 2,284.8 | 30.4 | 2,186.4 | 30.4 | 98.4 | — | |||||||||||||||||
Large-container | 1,630.8 | 21.7 | 1,547.1 | 21.5 | 83.7 | 0.2 | |||||||||||||||||
Other | 32.7 | 0.4 | 32.0 | 0.4 | 0.7 | — | |||||||||||||||||
Total collection | 5,619.7 | 74.8 | 5,446.4 | 75.7 | 173.3 | (0.9 | ) | ||||||||||||||||
Transfer | 931.7 | 886.6 | 45.1 | ||||||||||||||||||||
Less: intercompany | (529.1 | ) | (514.9 | ) | (14.2 | ) | |||||||||||||||||
Transfer, net | 402.6 | 5.4 | 371.7 | 5.2 | 30.9 | 0.2 | |||||||||||||||||
Landfill | 1,720.7 | 1,637.6 | 83.1 | ||||||||||||||||||||
Less: intercompany | (767.5 | ) | (740.3 | ) | (27.2 | ) | |||||||||||||||||
Landfill, net | 953.2 | 12.7 | 897.3 | 12.5 | 55.9 | 0.2 | |||||||||||||||||
Energy services | 149.6 | 2.0 | 102.2 | 1.4 | 47.4 | 0.6 | |||||||||||||||||
Other: | |||||||||||||||||||||||
Recycling processing and commodity sales | 220.0 | 2.9 | 225.1 | 3.1 | (5.1 | ) | (0.2 | ) | |||||||||||||||
Other non-core | 165.8 | 2.2 | 144.1 | 2.1 | 21.7 | 0.1 | |||||||||||||||||
Total other | 385.8 | 5.1 | 369.2 | 5.2 | 16.6 | (0.1 | ) | ||||||||||||||||
Total revenue | $ | 7,510.9 | 100.0 | % | $ | 7,186.8 | 100.0 | % | $ | 324.1 | — | % |
Three Months Ended September 30, | ||||||||||||||||||||||||
2018 | 2017 | Change | ||||||||||||||||||||||
Proforma | ||||||||||||||||||||||||
Labor and related benefits | $ | 536.1 | 20.9 | % | $ | 507.6 | 20.6 | % | $ | 28.5 | 0.3 | % | ||||||||||||
Transfer and disposal costs | 214.9 | 8.4 | 204.0 | 8.3 | 10.9 | 0.1 | ||||||||||||||||||
Maintenance and repairs | 250.8 | 9.8 | 240.0 | 9.7 | 10.8 | 0.1 | ||||||||||||||||||
Transportation and subcontract costs | 166.5 | 6.5 | 153.1 | 6.2 | 13.4 | 0.3 | ||||||||||||||||||
Fuel | 103.9 | 4.0 | 87.2 | 3.5 | 16.7 | 0.5 | ||||||||||||||||||
Disposal fees and taxes | 82.9 | 3.2 | 81.0 | 3.3 | 1.9 | (0.1 | ) | |||||||||||||||||
Landfill operating costs | 60.7 | 2.4 | 53.6 | 2.2 | 7.1 | 0.2 | ||||||||||||||||||
Risk management | 52.4 | 2.0 | 58.6 | 2.4 | (6.2 | ) | (0.4 | ) | ||||||||||||||||
Other | 109.2 | 4.3 | 98.1 | 4.0 | 11.1 | 0.3 | ||||||||||||||||||
Total cost of operations | $ | 1,577.4 | 61.5 | % | $ | 1,483.2 | 60.2 | % | $ | 94.2 | 1.3 | % |
Nine Months Ended September 30, | ||||||||||||||||||||||||
2018 | 2017 | Change | ||||||||||||||||||||||
Proforma | ||||||||||||||||||||||||
Labor and related benefits | $ | 1,604.2 | 21.4 | % | $ | 1,502.9 | 20.9 | % | $ | 101.3 | 0.5 | % | ||||||||||||
Transfer and disposal costs | 617.8 | 8.2 | 598.6 | 8.3 | 19.2 | (0.1 | ) | |||||||||||||||||
Maintenance and repairs | 742.3 | 9.9 | 702.8 | 9.8 | 39.5 | 0.1 | ||||||||||||||||||
Transportation and subcontract costs | 482.3 | 6.4 | 432.0 | 6.0 | 50.3 | 0.4 | ||||||||||||||||||
Fuel | 289.7 | 3.9 | 254.9 | 3.5 | 34.8 | 0.4 | ||||||||||||||||||
Disposal fees and taxes | 240.4 | 3.2 | 232.9 | 3.2 | 7.5 | — | ||||||||||||||||||
Landfill operating costs | 169.4 | 2.3 | 163.9 | 2.3 | 5.5 | — | ||||||||||||||||||
Risk management | 160.5 | 2.1 | 162.1 | 2.3 | (1.6 | ) | (0.2 | ) | ||||||||||||||||
Other | 317.8 | 4.2 | 280.4 | 3.9 | 37.4 | 0.3 | ||||||||||||||||||
Total cost of operations | $ | 4,624.4 | 61.6 | % | $ | 4,330.5 | 60.2 | % | $ | 293.9 | 1.4 | % |
Three Months Ended September 30, | ||||||||||||||||||||||||
2018 | 2017 | Change | ||||||||||||||||||||||
Proforma | ||||||||||||||||||||||||
Salaries | $ | 173.9 | 6.8 | % | $ | 176.8 | 7.2 | % | $ | (2.9 | ) | (0.4 | ) | % | ||||||||||
Provision for doubtful accounts | 10.8 | 0.4 | 8.0 | 0.3 | 2.8 | 0.1 | ||||||||||||||||||
Other | 76.2 | 3.0 | 81.9 | 3.3 | (5.7 | ) | (0.3 | ) | ||||||||||||||||
Total selling, general and administrative expenses | $ | 260.9 | 10.2 | % | $ | 266.7 | 10.8 | % | $ | (5.8 | ) | (0.6 | ) | % |
Nine Months Ended September 30, | ||||||||||||||||||||||||
2018 | 2017 | Change | ||||||||||||||||||||||
Proforma | ||||||||||||||||||||||||
Salaries | $ | 520.8 | 6.9 | % | $ | 527.0 | 7.3 | % | $ | (6.2 | ) | (0.4 | ) | % | ||||||||||
Provision for doubtful accounts | 24.4 | 0.3 | 22.8 | 0.3 | 1.6 | — | ||||||||||||||||||
Other | 229.8 | 3.1 | 233.3 | 3.3 | (3.5 | ) | (0.2 | ) | ||||||||||||||||
Total selling, general and administrative expenses | $ | 775.0 | 10.3 | % | $ | 783.1 | 10.9 | % | $ | (8.1 | ) | (0.6 | ) | % |
Three Months Ended September 30, | ||||||||||||||||||||||||
2018 | 2017 | Change | ||||||||||||||||||||||
Proforma | ||||||||||||||||||||||||
Adjusted EBITDA | $ | 727.5 | 28.4 | % | $ | 716.8 | 29.1 | % | $ | 10.7 | (0.7 | ) | % |
Nine Months Ended September 30, | ||||||||||||||||||||||||
2018 | 2017 | Change | ||||||||||||||||||||||
Proforma | ||||||||||||||||||||||||
Adjusted EBITDA | $ | 2,116.9 | 28.2 | % | $ | 2,078.2 | 28.9 | % | $ | 38.7 | (0.7 | ) | % |
Proforma | |||||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||||
March 31, 2017 | June 30, 2017 | September 30, 2017 | December 31, 2017 | 2017 | |||||||||||||||||||||||||||||||
Collection: | |||||||||||||||||||||||||||||||||||
Residential | $ | 552.2 | 24.0 | % | $ | 564.4 | 23.3 | % | $ | 564.3 | 22.9 | % | $ | 556.2 | 22.6 | % | $ | 2,237.2 | 23.2 | % | |||||||||||||||
Small-container | 718.2 | 31.2 | 731.7 | 30.2 | 736.5 | 29.9 | 743.6 | 30.2 | 2,930.0 | 30.4 | |||||||||||||||||||||||||
Large-container | 489.4 | 21.3 | 522.5 | 21.6 | 535.2 | 21.7 | 516.1 | 20.9 | 2,063.2 | 21.4 | |||||||||||||||||||||||||
Other | 9.7 | 0.4 | 10.7 | 0.4 | 11.6 | 0.5 | 12.0 | 0.5 | 44.0 | 0.5 | |||||||||||||||||||||||||
Total collection | 1,769.5 | 76.9 | 1,829.3 | 75.5 | 1,847.6 | 75.0 | 1,827.9 | 74.2 | 7,274.4 | 75.5 | |||||||||||||||||||||||||
Transfer | 274.9 | 305.1 | 306.6 | 296.5 | 1,183.1 | ||||||||||||||||||||||||||||||
Less: intercompany | (165.6 | ) | (176.2 | ) | (173.1 | ) | (167.8 | ) | (682.8 | ) | |||||||||||||||||||||||||
Transfer, net | 109.3 | 4.8 | 128.9 | 5.3 | 133.5 | 5.4 | 128.7 | 5.2 | 500.3 | 5.2 | |||||||||||||||||||||||||
Landfill | 500.6 | 565.3 | 571.7 | 569.2 | 2,206.9 | ||||||||||||||||||||||||||||||
Less: intercompany | (232.3 | ) | (255.4 | ) | (252.6 | ) | (244.7 | ) | (985.0 | ) | |||||||||||||||||||||||||
Landfill, net | 268.3 | 11.7 | 309.9 | 12.8 | 319.1 | 13.0 | 324.5 | 13.2 | 1,221.9 | 12.7 | |||||||||||||||||||||||||
Energy services | 26.9 | 1.2 | 35.8 | 1.5 | 39.5 | 1.6 | 45.1 | 1.8 | 147.3 | 1.5 | |||||||||||||||||||||||||
Other: | |||||||||||||||||||||||||||||||||||
Recycling processing and commodity sales | 78.7 | 3.4 | 73.3 | 3.0 | 73.1 | 3.0 | 87.7 | 3.6 | 312.8 | 3.2 | |||||||||||||||||||||||||
Other non-core | 45.9 | 2.0 | 47.1 | 1.9 | 51.1 | 2.0 | 51.3 | 2.0 | 195.3 | 1.9 | |||||||||||||||||||||||||
Total other | 124.6 | 5.4 | 120.4 | 4.9 | 124.2 | 5.0 | 139.0 | 5.6 | 508.1 | 5.1 | |||||||||||||||||||||||||
Total revenue | $ | 2,298.6 | 100.0 | % | $ | 2,424.3 | 100.0 | % | $ | 2,463.9 | 100.0 | % | $ | 2,465.2 | 100.0 | % | $ | 9,652.0 | 100.0 | % |
Proforma | ||||||||||||||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||||||||||||||
March 31, 2017 | June 30, 2017 | September 30, 2017 | December 31, 2017 | 2017 | ||||||||||||||||||||||||||||||||||||
Labor and related benefits | $ | 496.7 | 21.6 | % | $ | 498.6 | 20.6 | % | $ | 507.6 | 20.6 | % | $ | 524.4 | 21.3 | % | $ | 2,027.2 | 21.0 | % | ||||||||||||||||||||
Transfer and disposal costs | 187.3 | 8.1 | 207.3 | 8.6 | 204.0 | 8.3 | 197.3 | 8.0 | 795.9 | 8.3 | ||||||||||||||||||||||||||||||
Maintenance and repairs | 226.7 | 9.9 | 236.1 | 9.7 | 240.0 | 9.7 | 237.4 | 9.6 | 940.2 | 9.7 | ||||||||||||||||||||||||||||||
Transportation and subcontract costs | 134.0 | 5.8 | 144.9 | 6.0 | 153.1 | 6.2 | 153.7 | 6.2 | 585.8 | 6.1 | ||||||||||||||||||||||||||||||
Fuel | 84.5 | 3.7 | 83.2 | 3.4 | 87.2 | 3.5 | 94.8 | 3.8 | 349.8 | 3.6 | ||||||||||||||||||||||||||||||
Disposal fees and taxes | 71.3 | 3.1 | 80.6 | 3.3 | 81.0 | 3.3 | 78.7 | 3.2 | 311.6 | 3.2 | ||||||||||||||||||||||||||||||
Landfill operating costs | 53.1 | 2.3 | 57.1 | 2.4 | 53.6 | 2.2 | 56.6 | 2.3 | 220.3 | 2.3 | ||||||||||||||||||||||||||||||
Risk management | 47.5 | 2.1 | 56.0 | 2.3 | 58.6 | 2.4 | 50.5 | 2.1 | 212.6 | 2.2 | ||||||||||||||||||||||||||||||
Other | 90.0 | 3.9 | 92.4 | 3.8 | 98.1 | 4.0 | 106.1 | 4.3 | 386.6 | 4.0 | ||||||||||||||||||||||||||||||
Total cost of operations | $ | 1,391.1 | 60.5 | % | $ | 1,456.2 | 60.1 | % | $ | 1,483.2 | 60.2 | % | $ | 1,499.5 | 60.8 | % | $ | 5,830.0 | 60.4 | % |
Proforma | |||||||||||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||||||||||
March 31, 2017 | June 30, 2017 | September 30, 2017 | December 31, 2017 | 2017 | |||||||||||||||||||||||||||||||||||||
Salaries | $ | 176.7 | 7.7 | % | $ | 173.5 | 7.1 | % | $ | 176.8 | 7.2 | % | $ | 179.3 | 7.3 | % | $ | 706.3 | 7.3 | % | |||||||||||||||||||||
Provision for doubtful accounts | 5.4 | 0.2 | 9.4 | 0.4 | 8.0 | 0.3 | 7.8 | 0.3 | 30.6 | 0.3 | |||||||||||||||||||||||||||||||
Other | 71.4 | 3.1 | 80.0 | 3.3 | 81.9 | 3.3 | 87.1 | 3.5 | 320.5 | 3.4 | |||||||||||||||||||||||||||||||
Total selling, general and administrative expenses | $ | 253.5 | 11.0 | % | $ | 262.9 | 10.8 | % | $ | 266.7 | 10.8 | % | $ | 274.2 | 11.1 | % | $ | 1,057.4 | 11.0 | % |
Proforma | ||||||||||||||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||||||||||||||
March 31, 2017 | June 30, 2017 | September 30, 2017 | December 31, 2017 | 2017 | ||||||||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | 654.0 | 28.5 | % | $ | 707.4 | 29.2 | % | $ | 716.8 | 29.1 | % | $ | 694.8 | 28.2 | % | $ | 2,772.9 | 28.7 | % |
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