WM Demonstrates Growth in Q1 2023, Sees Boost in Truck Deliveries

WM (NYSE: WM) reported robust Q1 2023 results and touted its drive toward sustainability, particularly in renewable energy and recycling.

The Houston-based company recently hosted its Sustainability Investor Day that provided insight into its growth strategy. Revenue reached $4.892 billion in Q1 2023, up from $4.661 billion year over year (YOY).

CEO Jim Fish stated that while WM is "pleased" with the quarterly outcome, despite unfavorable weather conditions dampening business operations on the West Coast.

He added, "...our strategic priorities of maintaining strong price discipline, permanently reducing our operating and SG&A cost structure through business optimization, technology and automation and leveraging our sustainability platform for growth are right on track."

WM's collection and disposal line of business experienced 7 percent organic revenue growth. Core price reached 7.4 percent in Q1 2023, up from 7.3 percent the year prior.

Fish said the company expects strategic investments to generate "meaningful operating and free cash flow growth with impressive returns." He added two renewable natural gas facilities and seven automated MRF are expected to be online by the end of the year. 

"We're also opening one MRF in 2023 in the Greater Toronto Area, which positions us strongly in the largest growth market in Canada," Fish stated.

CFO Davina Rankin noted an easing of supply chain restraints in scheduled truck deliveries. 

 "At this time last year we have received less than 50 trucks. This year we received about 470," she said."This is certainly better and showed some easing of the significant supply chain constraints from a year ago."

Despite the uptick in vehicle deliveries, Rankin expressed ongoing concern.

"These delays impact our team's ability to deliver on residential collection optimization objectives and targeted improvements in maintenance cost per driver hour. So, while we're encouraged that the worst of the uncertainty is behind us, we still need to see a more reliable delivery schedule from manufacturers for our business."

Q1 2023 Highlights:

Revenue: $4.892 billion
Operating Income: $825 million
Net Income: $533 million
Operating EBITDA: $1.3 billion
Core Price: 7.4 percent