14.SEGMENT REPORTING

The Company’s revenues are generated from the collection, transfer, recycling and disposal of non-hazardous solid waste and the treatment, recovery and disposal of non-hazardous E&P waste. No single contract or customer accounted for more than 10% of the Company’s total revenues at the consolidated or reportable segment level during the periods presented.

The Company manages its operations through five geographic operating segments and its E&P segment, which includes the majority of the Company’s E&P waste treatment and disposal operations. The Company’s five geographic operating segments and its E&P segment comprise the Company’s reportable segments. Each operating segment is responsible for managing several vertically integrated operations, which are comprised of districts. In June 2016, as a result of the Progressive Waste acquisition, described in Note 3, the Company formed two new geographic operating segments, Canada and Southern, and realigned its reporting structure at its existing Central and Eastern segments. The Company’s segment realignment consisted of the transfer of certain operations in Texas and Louisiana from its Central segment to its Southern segment and the transfer of certain operations in Tennessee, Mississippi and Alabama from its Eastern segment to its Southern segment. The Progressive Waste acquisition did not impact the Company’s Western or E&P segments. The segment information presented herein reflects the realignment of these districts.

Under the current orientation, the Company’s Southern segment services customers located in Alabama, Arkansas, Florida, Louisiana, Mississippi, southern Oklahoma, western Tennessee and Texas; the Company’s Western segment services customers located in Alaska, California, Idaho, Montana, Nevada, Oregon, Washington and western Wyoming; the Company’s Eastern segment services customers located in Illinois, Iowa, Kentucky, Maryland, Massachusetts, Michigan, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, eastern Tennessee, Vermont, Virginia, Wisconsin and the District of Columbia; the Company’s Canada segment services customers located in the provinces of Alberta, British Columbia, Manitoba, Ontario and Québec; and the Company’s Central segment services customers located in Arizona, Colorado, Kansas, Minnesota, Missouri, Nebraska, New Mexico, Oklahoma, South Dakota, western Texas, Utah and eastern Wyoming. The E&P segment services E&P customers located in Arkansas, Louisiana, New Mexico, North Dakota, Oklahoma, Texas, Wyoming and along the Gulf of Mexico.

The Company’s Chief Operating Decision Maker evaluates operating segment profitability and determines resource allocations based on several factors, of which the primary financial measure is segment EBITDA. The Company defines segment EBITDA as earnings before interest, taxes, depreciation, amortization, impairments and other operating items, other income (expense) and foreign currency transaction gain (loss). Segment EBITDA is not a measure of operating income, operating performance or liquidity under generally accepted accounting principles and may not be comparable to similarly titled measures reported by other companies. The Company’s management uses segment EBITDA in the evaluation of segment operating performance as it is a profit measure that is generally within the control of the operating segments. A reconciliation of segment EBITDA to Income before income tax provision is included at the end of this Note 14.

Summarized financial information concerning the Company’s reportable segments for the years ended December 31, 2016, 2015 and 2014, is shown in the following tables:


Year Ended December 31, 2016	Revenue		Intercompany Revenue(b)		Reported Revenue		Segment EBITDA(c)		Depreciation and Amortization		Capital Expenditures		Total Assets(e)
Southern	$	809,926	$	(96,545)	$	713,381	$	163,320	$	99,323	$	64,624	$	2,869,841
Western		1,051,637		(116,318)		935,319		315,708		89,198		86,200		1,516,870
Eastern		751,410		(114,758)		636,652		193,361		91,336		82,434		1,541,854
Canada		466,458		(58,597)		407,861		149,305		68,640		20,424		2,532,046
Central		634,393		(72,852)		561,541		208,930		70,027		71,888		1,302,900
E&P		132,504		(11,395)		121,109		32,479		41,215		10,178		1,068,086
Corporate(a), (d)		-		-		-		(119,215)		4,173		8,975		361,505
	$	3,846,328	$	(470,465)	$	3,375,863	$	943,888	$	463,912	$	344,723	$	11,193,102


Year Ended December 31, 2015	Revenue		Intercompany Revenue(b)		Reported Revenue		Segment EBITDA(c)		Depreciation and Amortization		Capital Expenditures		Total Assets(e)
Southern	$	168,855	$	(23,566)	$	145,289	$	35,718	$	19,959	$	20,779	$	259,046
Western		984,283		(103,890)		880,393		290,937		83,073		82,118		1,498,296
Eastern		451,469		(75,313)		376,156		119,668		52,132		44,299		1,062,761
Central		559,801		(59,590)		500,211		184,006		64,072		57,163		1,070,505
E&P		226,782		(11,544)		215,238		70,132		47,339		31,632		1,115,234
Corporate(a), (d)		-		-		-		1,933		2,859		2,842		115,956
	$	2,391,190	$	(273,903)	$	2,117,287	$	702,394	$	269,434	$	238,833	$	5,121,798


Year Ended December 31, 2014	Revenue		Intercompany Revenue(b)		Reported Revenue		Segment EBITDA(c)		Depreciation and Amortization		Capital Expenditures		Total Assets(e)
Southern	$	158,480	$	(22,950)	$	135,530	$	32,539	$	17,487	$	32,033	$	249,437
Western		920,116		(96,194)		823,922		258,126		79,907		65,227		1,482,474
Eastern		411,106		(68,768)		342,338		104,224		47,269		50,252		740,015
Central		532,415		(56,538)		475,877		175,935		57,902		55,481		1,050,436
E&P		316,401		(14,902)		301,499		147,914		52,805		36,726		1,610,133
Corporate(a), (d)		-		-		-		(7,434)		2,574		1,558		112,772
	$	2,338,518	$	(259,352)	$	2,079,166	$	711,304	$	257,944	$	241,277	$	5,245,267

____________________

(a)Corporate functions include accounting, legal, tax, treasury, information technology, risk management, human resources, training and other administrative functions. Amounts reflected are net of allocations to the six operating segments. For the year ended December 31, 2016, amounts also include costs associated with the Progressive Waste acquisition.

(b)Intercompany revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments. Transactions within and between segments are generally made on a basis intended to reflect the market value of the service.

(c)For those items included in the determination of segment EBITDA, the accounting policies of the segments are the same as those described in Note 1.

(d)Corporate assets include cash, net deferred tax assets, debt issuance costs, equity investments, and corporate facility leasehold improvements and equipment.

(e)Goodwill is included within total assets for each of the Company’s six operating segments.

The following table shows changes in goodwill during the years ended December 31, 2015 and 2016, by reportable segment:



	Southern		Western		Eastern		Canada		Central		E&P			Total
Balance as of December 31, 2014	$	-	$	372,915	$	392,423	$	-	$	460,381	$	468,070	$	1,693,789
Goodwill transferred (a)		92,531		-		(39,705)		-		(52,826)		-		-
Goodwill acquired		3,179		905		106,814		-		8,865		21,059		140,822
Impairment loss		-		-		-		-		-		(411,786)		(411,786)
Balance as of December 31, 2015		95,710		373,820		459,532		-		416,420		77,343		1,422,825
Goodwill acquired		1,378,879		2,717		79,116		1,502,850		51,504		-		3,015,066
Impairment loss related to assets held for sale		(4,566)		-		(5,244)		-		-		-		(9,810)
Goodwill reclassified as assets held for sale		-		-		(244)		-		-		-		(244)
Impact of changes in foreign currency		-		-		-		(37,576)		-		-		(37,576)
Balance as of December 31, 2016	$	1,470,023	$	376,537	$	533,160	$	1,465,274	$	467,924	$	77,343	$	4,390,261

____________________

(a)In June 2016, as a result of the Progressive Waste acquisition, described in Note 3, the Company realigned its reporting structure and changed its three geographic operating segments (Western, Central and Eastern) to five geographic operating segments (Southern, Western, Eastern, Canada and Central). Additionally, the Company realigned certain of the Company’s districts between operating segments. This realignment resulted in the reallocation of goodwill among its segments, which is reflected in the “Goodwill transferred” line item.

Property and equipment, net relating to operations in the United States and Canada are as follows:


	December 31,
	2016		2015
United States	$	4,020,703	$	2,738,288
Canada		717,352		-
Total	$	4,738,055	$	2,738,288

A reconciliation of the Company’s primary measure of segment profitability (segment EBITDA) to Income (loss) before income tax provision in the Consolidated Statements of Net Income (Loss) is as follows:


	Years ended December 31,
	2016		2015		2014
Southern segment EBITDA	$	163,320	$	35,718	$	32,539
Western segment EBITDA		315,708		290,937		258,126
Eastern segment EBITDA		193,361		119,668		104,224
Canada segment EBITDA		149,305		-		-
Central segment EBITDA		208,930		184,006		175,935
E&P segment EBITDA		32,479		70,132		147,914
Subtotal reportable segments		1,063,103		700,461		718,738
Unallocated corporate overhead		(119,215)		1,933		(7,434)
Depreciation		(393,600)		(240,357)		(230,944)
Amortization of intangibles		(70,312)		(29,077)		(27,000)
Impairments and other operating items		(27,678)		(494,492)		(4,091)
Interest expense		(92,709)		(64,236)		(64,674)
Other income (expense), net		655		(518)		1,067
Foreign currency transaction gain		1,121		-		-
Income (loss) before income tax provision	$	361,365	$	(126,286)	$	385,662

The following tables reflect a breakdown of the Company’s revenue and inter-company eliminations for the periods indicated:


	Year Ended December 31, 2016
	Revenue		Intercompany Revenue		Reported Revenue		% of Reported Revenue
Solid waste collection	$	2,359,813	$	(7,766)	$	2,352,047		69.7%
Solid waste disposal and transfer		1,155,410		(443,022)		712,388		21.1
Solid waste recycling		92,456		(6,941)		85,515		2.5
E&P waste treatment, recovery and disposal		132,286		(12,086)		120,200		3.6
Intermodal and other		106,363		(650)		105,713		3.1
Total	$	3,846,328	$	(470,465)	$	3,375,863		100.0%


	Year Ended December 31, 2015
	Revenue		Intercompany Revenue		Reported Revenue		% of Reported Revenue
Solid waste collection	$	1,378,679	$	(4,623)	$	1,374,056		64.9%
Solid waste disposal and transfer		670,369		(255,200)		415,169		19.6
Solid waste recycling		47,292		(924)		46,368		2.2
E&P waste treatment, recovery and disposal		228,529		(13,156)		215,373		10.2
Intermodal and other		66,321		-		66,321		3.1
Total	$	2,391,190	$	(273,903)	$	2,117,287		100.0%


	Year Ended December 31, 2014
	Revenue		Intercompany Revenue		Reported Revenue		% of Reported Revenue
Solid waste collection	$	1,289,906	$	(3,593)	$	1,286,313		61.9%
Solid waste disposal and transfer		617,161		(235,851)		381,310		18.3
Solid waste recycling		58,226		(2,118)		56,108		2.7
E&P waste treatment, recovery and disposal		326,934		(16,862)		310,072		14.9
Intermodal and other		46,291		(928)		45,363		2.2
Total	$	2,338,518	$	(259,352)	$	2,079,166		100.0%