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10 Takeaways from Advanced Disposal’s Latest Financial Results

Article-10 Takeaways from Advanced Disposal’s Latest Financial Results

ADS Waste Holdings Inc., which operates as Advanced Disposal, posted a net loss for its third quarter, although smaller than a year earlier, on a decline in revenue.

Here are 10 highlights of the financial results from the Ponte Vedra, Fla.-based waste and recycling firm.

  1. ADS Waste recorded a net loss of $5.5 million for the period ended Sept. 30, compared with a $6.5 million loss a year earlier.
  2. Revenue fell 2 percent to $361.3 million from $368.1 million a year earlier, according to a news release.
  3. Excluding losses on fuel derivatives, earnings before interest, taxes, depreciation and amortization (EBITDA) was the same in 2015 and 2014, at $105.6 million.
  4. The company reported pricing gains of 2.6 percent. That helped offset a 12-percent decline in special waste volume and lower commodity prices.
  5. For the nine-month period, the loss totaled $24.8 million compared with $41.4 million a year ago.
  6. Revenue for the year to date slipped slightly to $1.047 billion from 1.049 billion.
  7. CEO Richard Burke said of the latest results: "During the first nine months of 2015, we divested lower margin business and rationalized certain residential contracts that did not meet our long-term investment hurdle rates. At the same time, we redeployed capital in more profitable markets, which is consistent with our strategy of building strong competitive operations in the vertically integrated markets we serve. We expect these efforts, coupled with pricing above inflation and controlling costs over the long-term, will continue to drive margin expansion and improve returns on invested capital."
  8. Advanced Disposal most recently acquired waste hauler Williams Sanitation Services, LLC, based in Dubois, Pa. The deal represents the eighth acquisition by Advanced Disposal in 2015, but the first since June. That month Advanced bought the Smethport, Pa.-based waste company CF Burdick Trucking; the Decatur, Ill.-based Ross Disposal Services; and Disposal Management Systems Inc., based in Schaumburg, Ill. Advanced Disposal said in its earnings report that it has completed nearly $30 million of tuck-in transactions for the first nine months.
  9. In August Advanced Disposal announced that it is going public with an initial public offering (IPO). Advanced said the proceeds from the sale will be used to repay debt. Renaissance Capital said on its website that the IPO could raise up to $100 million. In an interview with Waste360, Michael E. Hoffman, industry analyst and managing director, Stifel, Nicolaus & Co. Inc., shared his thoughts on the proposal and what impact it can have on the industry.
  10. In her most recent Waste360 Business Insights column on the financial results of the industry’s publicly held companies, Leone Young said firms reported improved fundamentals, solid margins, and continued mergers and acquisition activity during the period.
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