Covanta Holding Corporation Reports 2021 Third Quarter Results

November 1, 2021

3 Min Read

MORRISTOWN, N.J.,  -- Covanta Holding Corporation (NYSE: CVA) ("Covanta" or the "Company"), a world leader in sustainable waste and energy solutions, reported financial results for the three and nine months ended September 30, 2021.

Three Months EndedSeptember 30,


(Unaudited, $ in millions)


Net income

Adjusted EBITDA

Net cash provided by operating activities

Free Cash Flow

Reconciliations of non-GAAP measures can be found in the exhibits to this press release.

Key Highlights

  • Adjusted EBITDA up $41 million year-over-year

  • Waste-to-energy tip fee price growth of 4.5% year-over-year

  • Capturing materially higher prices for energy and recycled metals

  • UK construction and commissioning activities on track

  • EQT transaction received shareholder approval on October 12, and is expected to close by end of year, subject to final regulatory approvals

"Our team continues to execute extremely well, with consistent operating performance positioning the Company to maximize revenue in a strong market environment that includes upward pressure on disposal prices, growing demand for sustainable waste solutions, and higher values for the commodities we generate," said Michael Ranger, President and CEO. "While we work toward closing our transaction with EQT and preparing for the Company's next chapter, we remain focused on our customers and communities, operating safely and efficiently, and leveraging the unique value of our assets."

Discussion of Third Quarter 2021 Results
Total revenue for the three months ended September 30, 2021 was $539 million, up $48 million as compared to the prior year period, driven by the following:

  • Waste revenue improved by $20 million, with growth in nearly all areas, including:

    • Tip fees up $16 million on higher prices and volumes; and 

    • Material processing and recycling revenue up $7 million amid strong recovery in demand for environmental services;

  • Energy revenue increased by $11 million due to higher market prices and increased revenue from renewable energy credits, partially offset by lower wholesale load serving revenue; and

  • Materials sales increased by $21 million, with a $15 million increase in ferrous revenue and a $6 million increase in non-ferrous revenue due to higher market prices for metal products.

Total operating expenses were $465 million in the quarter, up $24 million over the prior year period, driven by the following:

  • Wages and benefits rose by $9 million, with normalized compensation costs compared to COVID-related cost mitigation actions taken in the third quarter of 2020 and higher accruals for incentive compensation based on financial performance;

  • Maintenance expense decreased by $7 million due to the timing of planned outage activity;

  • Other operating costs increased by $5 million primarily related to higher insurance premiums, transportation and fuel costs; and

  • General and administrative expense rose by $9 million, with the cost mitigation actions taken in the prior year period and increased costs relating to the strategic review impacting the comparison.

Adjusted EBITDA increased by $41 million to $169 million, driven primarily by higher waste and commodity prices and lower maintenance expense, partially offset by higher costs compared to the prior year cost mitigation program.

Free Cash Flow was $60 million in the quarter, up $58 million compared to the prior year. This improvement was driven primarily by higher Adjusted EBITDA and reduced maintenance capital expenditures.

The Company ended the quarter with $2.4 billion of net debt outstanding and a leverage ratio of 5.2x.

About Covanta
Covanta is a world leader in providing sustainable waste and energy solutions.  Annually, Covanta's modern Waste-to-Energy ("WtE") facilities safely convert approximately 21 million tons of waste from municipalities and businesses into clean, renewable electricity to power one million homes and recycle 600,000 tons of metal. Through a vast network of treatment and recycling facilities, Covanta also provides comprehensive industrial material management services to companies seeking solutions to some of today's most complex environmental challenges. For more information, visit

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