Waste Management Inc. recorded higher net earnings but lower revenue for its third quarter.
The following are highlights from the Houston-based company’s latest results, for the period ended Sept. 30.
- Waste Management’s net earnings jumped 24.1 percent to $335 million, or 74 cents per diluted share, compared with $270 million, or 58 cents per diluted share, in the 2014 third quarter.
- Revenue declined 6.7 percent to $3.36 billion from $3.60 billion a year ago, according to a news release.
- The third-quarter results were adjusted to exclude about 14 cents per diluted share of after-tax net charges primarily related to the restructuring of several corporate functions and legal reserves. Also excluded were earnings from businesses and assets divested in 2014, amounting to 5 cents per diluted share in the third quarter.
- From David Steiner, president and CEO: “Our third quarter results reflect the impact of our continued commitment to core price, disciplined growth and cost controls, all of which are driving improvement in our key operating metrics.” He said the company improved volumes in the quarter, as well as positive growth from its industrial business.
- Average recycling commodity prices dropped 15 percent in the latest quarter compared with the year-ago period. Recycling volumes also declined 6.4 percent. Nevertheless, earnings from recycling operations were flat compared with the 2014 period because of operational improvements.
- For the nine-month period, Waste Management’s net income decreased 74.6 percent to $480 million, or $1.05 per diluted share, compared with $708 million, or $1.52 per diluted share, a year earlier.
- Revenues dipped 8 percent to $9.72 billion from $10.6 billion for the year-to-date period.
- Steiner said the company is confident it can meet analysts’ fourth quarter consensus of 67 cents of adjusted earnings per diluted share, which would allow Waste Management to exceed the upper end of its 2015 guidance per diluted share of $2.55.
- The assessment of Zacks Equity Research: Earnings beat Zacks Consensus Estimate by 2 cents. It attributed the increase to cost control measures. Meanwhile, revenue missed the Zacks Consensus Estimate of $3.41 billion. It attributed the decline to divestitures, lower recycling revenues, lower fuel surcharge revenues and foreign currency fluctuations.
- Waste Management's results in the second quarter were similar: Higher net earnings, lower revenue. The company blamed the revenue decline on recycling struggles and less divestiture revenue.