Houston-based Waste Management posted a net income of $237 million on $3.35 billion in revenue during second-quarter 2011. During the same period in 2010, Waste Management posted a net income of $246 million on $3.16 billion in revenue.
The result and a prediction of lighter volumes for the remainder of the year led the company to downgrade its 2011 forecast. It now projects full year adjusted earnings per diluted share of between $2.14 and $2.18, and free cash flow of around $1.25 billion.
“Although we expected our yield to decrease from the first quarter, we are not satisfied that yield dropped below 2%,” said David P. Steiner, CEO of Waste Management, in a press release. “As a result, we are taking pricing actions intended to increase yield, and we still expect our full year yield to be about 2%.
“Given the current business environment and our current outlook for volumes, we have already instituted cost reduction programs. These cost reductions, combined with our pricing actions, are intended to generate at least $80 million in income from operations for the remainder of 2011.
“For the remainder of the year, we expect recycling commodity prices to remain strong, and for our waste-to-energy operations to achieve earnings similar to 2010 second half earnings. While we expect to see the benefits of our cost reduction programs and growth initiatives, we also expect to see weaker volumes in the second half than we originally planned.“