Condensed Consolidating Financial Statements (Tables)

6 Months Ended

Jun. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEETS

June 30, 2016

(Unaudited)


	WM		WM Holdings		Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	—	$	39	$	—		$	39
Other current assets		6		7		2,224		—			2,237

		6		7		2,263		—			2,276
Property and equipment, net		—		—		10,841		—			10,841
Investments in and advances to affiliates(a)		19,194		19,628		7,490		(46,312	)		—
Other assets		15		30		7,590		—			7,635

Total assets	$	19,215	$	19,665	$	28,184	$	(46,312	)	$	20,752


LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	500	$	—	$	114	$	—		$	614
Accounts payable and other current liabilities		84		11		2,097		—			2,192

		584		11		2,211		—			2,806
Long-term debt, less current portion(a)		6,073		304		2,539		—			8,916
Due to affiliates(a)		7,334		156		—		(7,490	)		—
Other liabilities		16		—		3,786		—			3,802

Total liabilities		14,007		471		8,536		(7,490	)		15,524
Equity:
Stockholders’ equity		5,208		19,194		19,628		(38,822	)		5,208
Noncontrolling interests		—		—		20		—			20

		5,208		19,194		19,648		(38,822	)		5,228

Total liabilities and equity	$	19,215	$	19,665	$	28,184	$	(46,312	)	$	20,752

(a)

In conjunction with the preparation of our June 30, 2016 Condensed Consolidating Balance Sheet, we identified and corrected the presentation of $126 million of tax-exempt bonds previously reported in Non-Guarantor Subsidiaries’ rather than WM’s “Long-term debt, less current portion,” which had corresponding impacts on “Investments in and advances to affiliates” and “Due to affiliates.” This immaterial correction has been reflected in our June 30, 2016 Condensed Consolidating Financial Statements.

CONDENSED CONSOLIDATING BALANCE SHEETS (Continued)

December 31, 2015


	WM		WM Holdings		Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	—	$	39	$	—		$	39
Other current assets		3		6		2,297		—			2,306

		3		6		2,336		—			2,345
Property and equipment, net		—		—		10,665		—			10,665
Investments in and advances to affiliates		18,557		18,911		7,365		(44,833	)		—
Other assets		23		29		7,305		—			7,357

Total assets	$	18,583	$	18,946	$	27,671	$	(44,833	)	$	20,367


LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	41	$	—	$	212	$	—		$	253
Accounts payable and other current liabilities		83		9		2,165		—			2,257

		124		9		2,377		—			2,510
Long-term debt, less current portion		5,801		304		2,571		—			8,676
Due to affiliates		7,289		76		—		(7,365	)		—
Other liabilities		24		—		3,790		—			3,814

Total liabilities		13,238		389		8,738		(7,365	)		15,000
Equity:
Stockholders’ equity		5,345		18,557		18,911		(37,468	)		5,345
Noncontrolling interests		—		—		22		—			22

		5,345		18,557		18,933		(37,468	)		5,367

Total liabilities and equity	$	18,583	$	18,946	$	27,671	$	(44,833)		$	20,367

Condensed Consolidating Statements of Operations

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2016

(Unaudited)


	WM			WM Holdings			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenues	$	—		$	—		$	3,425		$	—		$	3,425
Costs and expenses		—			—			2,814			—			2,814

Income from operations		—			—			611			—			611

Other income (expense):
Interest expense, net		(76	)		(5	)		(12	)		—			(93	)
Loss on early extinguishment of debt		—			—			(3	)		—			(3	)
Equity in earnings of subsidiaries, net of taxes		333			336			—			(669	)		—
Other, net		—			—			(56	)		—			(56	)

		257			331			(71	)		(669	)		(152	)

Income (loss) before income taxes		257			331			540			(669	)		459
Provision for (benefit from) income taxes		(30	)		(2	)		205			—			173

Consolidated net income		287			333			335			(669	)		286
Less: Net income (loss) attributable to noncontrolling interests		—			—			(1	)		—			(1	)

Net income attributable to Waste Management, Inc.	$	287		$	333		$	336		$	(669	)	$	287

Three Months Ended June 30, 2015

(Unaudited)


	WM			WM Holdings			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenues	$	—		$	—		$	3,315		$	—		$	3,315
Costs and expenses		—			(6	)		2,819			—			2,813

Income from operations		—			6			496			—			502

Other income (expense):
Interest expense, net		(75	)		(5	)		(15	)		—			(95	)
Loss on early extinguishment of debt		(2	)		—			—			—			(2	)
Equity in earnings of subsidiaries, net of taxes		320			317			—			(637	)		—
Other, net		—			—			(16	)		—			(16	)

		243			312			(31	)		(637	)		(113	)

Income (loss) before income taxes		243			318			465			(637	)		389
Provision for (benefit from) income taxes		(31	)		(2	)		149			—			116

Consolidated net income		274			320			316			(637	)		273
Less: Net income (loss) attributable to noncontrolling interests		—			—			(1	)		—			(1	)

Net income attributable to Waste Management, Inc.	$	274		$	320		$	317		$	(637	)	$	274

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (Continued)

Six Months Ended June 30, 2016

(Unaudited)


	WM			WM Holdings			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenues	$	—		$	—		$	6,601		$	—		$	6,601
Costs and expenses		—			—			5,482			—			5,482

Income from operations		—			—			1,119			—			1,119

Other income (expense):
Interest expense, net		(150	)		(10	)		(28	)		—			(188	)
Loss on early extinguishment of debt		(1	)		—			(3	)		—			(4	)
Equity in earnings of subsidiaries, net of taxes		637			643			—			(1,280	)		—
Other, net		—			—			(72	)		—			(72	)

		486			633			(103	)		(1,280	)		(264	)

Income (loss) before income taxes		486			633			1,016			(1,280	)		855
Provision for (benefit from) income taxes		(59	)		(4	)		376			—			313

Consolidated net income		545			637			640			(1,280	)		542
Less: Net income (loss) attributable to noncontrolling interests		—			—			(3	)		—			(3	)

Net income attributable to Waste Management, Inc.	$	545		$	637		$	643		$	(1,280	)	$	545

Six Months Ended June 30, 2015

(Unaudited)


	WM			WM Holdings			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenues	$	—		$	—		$	6,355		$	—		$	6,355
Costs and expenses		—			—			5,413			—			5,413

Income from operations		—			—			942			—			942

Other income (expense):
Interest expense, net		(154	)		(12	)		(33	)		—			(199	)
Loss on early extinguishment of debt		(500	)		(52	)		—			—			(552	)
Equity in earnings of subsidiaries, net of taxes		551			590			—			(1,141	)		—
Other, net		—			—			(24	)		—			(24	)

		(103	)		526			(57	)		(1,141	)		(775	)

Income (loss) before income taxes		(103	)		526			885			(1,141	)		167
Provision for (benefit from) income taxes		(248	)		(25	)		298			—			25

Consolidated net income		145			551			587			(1,141	)		142
Less: Net income (loss) attributable to noncontrolling interests		—			—			(3	)		—			(3	)

Net income attributable to Waste Management, Inc.	$	145		$	551		$	590		$	(1,141	)	$	145

Condensed Consolidating Statements of Comprehensive Income

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	WM		WM Holdings		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Three Months Ended June 30, 2016
Comprehensive income	$	289	$	333	$	342		$	(669	)	$	295
Less: Comprehensive income (loss) attributable to noncontrolling interests		—		—		(1	)		—			(1	)

Comprehensive income attributable to Waste Management, Inc.	$	289	$	333	$	343		$	(669	)	$	296

Three Months Ended June 30, 2015
Comprehensive income	$	276	$	320	$	330		$	(637	)	$	289
Less: Comprehensive income (loss) attributable to noncontrolling interests		—		—		(1	)		—			(1	)

Comprehensive income attributable to Waste Management, Inc.	$	276	$	320	$	331		$	(637	)	$	290


	WM		WM Holdings		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Six Months Ended June 30, 2016
Comprehensive income	$	549	$	637	$	714		$	(1,280	)	$	620
Less: Comprehensive income (loss) attributable to noncontrolling interests		—		—		(3	)		—			(3	)

Comprehensive income attributable to Waste Management, Inc.	$	549	$	637	$	717		$	(1,280	)	$	623

Six Months Ended June 30, 2015
Comprehensive income	$	151	$	551	$	524		$	(1,141	)	$	85
Less: Comprehensive income (loss) attributable to noncontrolling interests		—		—		(3	)		—			(3	)

Comprehensive income attributable to Waste Management, Inc.	$	151	$	551	$	527		$	(1,141	)	$	88

Condensed Consolidating Statements of Cash Flows

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2016

(Unaudited)


	WM			WM Holdings			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Consolidated net income	$	545		$	637		$	640		$	(1,280	)	$	542
Equity in earnings of subsidiaries, net of taxes		(637	)		(643	)		—			1,280			—
Other adjustments		6			(1	)		907			—			912

Net cash provided by (used in) operating activities		(86	)		(7	)		1,547			—			1,454

Cash flows from investing activities:
Acquisitions of businesses, net of cash acquired		—			—			(572	)		—			(572	)
Capital expenditures		—			—			(629	)		—			(629	)
Proceeds from divestitures of businesses and other assets (net of cash divested)		—			—			24			—			24
Net receipts from restricted trust and escrow accounts and other, net		—			—			(9	)		—			(9	)

Net cash used in investing activities		—			—			(1,186	)		—			(1,186	)

Cash flows from financing activities:
New borrowings		1,647			—			447			—			2,094
Debt repayments		(1,038	)		—			(479	)		—			(1,517	)
Premiums paid on early extinguishment of debt		(1	)		—			(1	)		—			(2	)
Common stock repurchases		(500	)		—			—			—			(500	)
Cash dividends		(364	)		—			—			—			(364	)
Exercise of common stock options		44			—			—			—			44
Other, net		15			—			(39	)		—			(24	)
(Increase) decrease in intercompany and investments, net		283			7			(290	)		—			—

Net cash provided by (used in) financing activities		86			7			(362	)		—			(269	)

Effect of exchange rate changes on cash and cash equivalents		—			—			1			—			1

Increase (decrease) in cash and cash equivalents		—			—			—			—			—
Cash and cash equivalents at beginning of period		—			—			39			—			39

Cash and cash equivalents at end of period	$	—		$	—		$	39		$	—		$	39

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (Continued)

Six Months Ended June 30, 2015

(Unaudited)


	WM			WM Holdings			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Consolidated net income	$	145		$	551		$	587		$	(1,141	)	$	142
Equity in earnings of subsidiaries, net of taxes		(551	)		(590	)		—			1,141			—
Other adjustments		5			(5	)		1,173			—			1,173

Net cash provided by (used in) operating activities		(401	)		(44	)		1,760			—			1,315

Cash flows from investing activities:
Acquisitions of businesses, net of cash acquired		—			—			(454	)		—			(454	)
Capital expenditures		—			—			(529	)		—			(529	)
Proceeds from divestitures of businesses and other assets (net of cash divested)		—			—			78			—			78
Net receipts from restricted trust and escrow accounts and other, net		—			—			26			—			26

Net cash used in investing activities		—			—			(879	)		—			(879	)

Cash flows from financing activities:
New borrowings		1,781			—			85			—			1,866
Debt repayments		(1,825	)		(144	)		(212	)		—			(2,181	)
Premiums paid on early extinguishment of debt		(503	)		(52	)		—			—			(555	)
Common stock repurchases		(300	)		—			—			—			(300	)
Cash dividends		(351	)		—			—			—			(351	)
Exercise of common stock options		47			—			—			—			47
Other, net		5			—			—			—			5
(Increase) decrease in intercompany and investments, net		460			240			(700	)		—			—

Net cash provided by (used in) financing activities		(686	)		44			(827	)		—			(1,469	)

Effect of exchange rate changes on cash and cash equivalents		—			—			(1	)		—			(1	)

Increase (decrease) in cash and cash equivalents		(1,087	)		—			53			—			(1,034	)
Cash and cash equivalents at beginning of period		1,235			—			72			—			1,307

Cash and cash equivalents at end of period	$	148		$	—		$	125		$	—		$	273