Progressive Waste Solutions Ltd. reported lower net income and revenue for its first quarter, attributed in part to interest rate differences between Canada and the United States.
The Vaughan, Ontario-based Progressive Waste said for the period ended March 31 net earnings dropped 30 percent to $18.1 million, or 16 cents per diluted share, compared with $25.9 million, 23 cents per diluted share, in the 2014 first quarter.
Revenue fell 2 percent to $460.2 million from $469.8 million. Assuming FX, or constant currency, parity, between the Canadian and U.S. dollar, revenue increased 2.1 percent in the 2015 quarter.
“The first-quarter contributions, adjusted for the delayed volumes due to weather and insurable claims, are in line with our expectations,” said Joseph Quarin, Progressive president and CEO. “We achieved a solid first-quarter performance, driven by strong organic revenue growth, excluding fuel surcharges and recycled commodities sales.”
Quarin also said the company identified further opportunities to reorganize and optimize its regional management structure, which it expects will result in a restructuring cost of $3.5 million to $4.5 million, primarily in the second quarter.
Progressive’s results did not meet Wall Street expectations, according to the AP. The average estimate of three analysts surveyed by Zacks Investment Research was for earnings of 25 cents per share.
In her recent Waste360 Business Insights column, industry financial analyst Leone Young observed that Progressive for the year expects earnings per share in the range of $1.26-$1.39 versus the $1.33 reported in 2014, because of the weaker Canadian dollar. Progressive’s capital spending was higher and its cash flow was lower than analysts’ expectations. It had strong margin improvement, primarily from its internal programs. It has set an organic growth target of 2.7 percent, Young said.
For 2014 Progressive Waste’s net earnings climbed 7.2 percent to $126.5 million. Revenue dropped 0.8 percent to $2.01 billion.