Ponte Vedra, Fla.-based Advanced Disposal posted its fourth quarter and full year 2016 results. For the year, the firm posted $1.404 billion in revenues—up slightly from the $1.396 billion in revenues it posted in 2015.
"Advanced Disposal has undergone transformational changes during 2016," Advanced Disposal CEO Richard Burke said in a statement. "I am pleased we were able to improve our capital structure and begin the next chapter of our company's history as a public company, while at the same time producing strong results for both fourth quarter and the full year 2016. We were also able to continue to execute on our strategy of entering vertically-integrated operations in secondary markets earlier this month by closing on the acquisition of CGS Services Inc. in Indiana. Overall, the combination of continued execution of our operating strategy, along with capital structure improvements, positions us well to generate strong cash provided by operating activities in 2017."
Other highlights for the firm included:
- Revenue for the three months ended December 31, 2016 was $352.0 million versus $349.6 million in the same period of the prior year.
- Net loss during fourth quarter 2016 was $20.1 million, or $0.24 per share, versus a net loss of $8.8 million, or $0.14 per share, in fourth quarter 2015.
- The company achieved quarterly adjusted EBITDA and adjusted EBITDA margins of $107.7 million and 30.6 percent, respectively, or an increase of $6.2 million in adjusted EBITDA and 160 basis points in adjusted EBITDA margins versus fourth quarter 2015.
- During the fourth quarter, the company completed its initial public offering, which raised nearly $375 million net of fees between the initial share issuance and the underwriters exercising their option to purchase additional shares. Those proceeds were used to repay debt, driving improvements in the company's leverage ratio.
- The company also received credit ratings upgrades by both Standard & Poor's and Moody's. Based on the momentum generated from the initial public offering and subsequent ratings upgrades, the company refinanced its outstanding debt and credit facility in the fourth quarter. This debt refinancing coupled with the debt repayments from the initial public offering is expected to save the company over $30 million in cash interest savings annually.
- A $64.7 million pretax loss on debt extinguishments and modifications was recorded, which is the driver of the decline of fourth quarter net income. However, fourth quarter adjusted net income, which includes an adjustment for the debt refinancing charge, was $17.2 million or an increase of $11.7 million versus fourth quarter 2015.
- Strong pricing was a key driver of the increase in adjusted net income with average yield for the quarter of 2.7 percent.
- For the full year, net loss improved $3.2 million to $30.4 million, and adjusted net income increased $17.6 million to $33.5 million. Additionally, adjusted EBITDA of $411.1 million was $11.1 million better year-over-year, and adjusted EBITDA margins also improved 70 basis points to 29.3 percent.
- Looking ahead to 2017, the company estimates revenue will be between $1,450 million and $1,475 million. This includes $25 million of revenue in 2017 related to the company's recently announced acquisition of CGS Services, Inc.
- Adjusted EBITDA is estimated to be between $423 million and $433 million.
- Adjusted free cash flow is estimated to be between $121 million and $141 million.