RALEIGH, N.C., March 4 /PRNewswire-FirstCall/ -- Waste Industries USA,
Inc. (Nasdaq: WWIN), a regional, non-hazardous solid waste services
company, today reported preliminary financial results for the fourth
quarter and full year ended December 31, 2007.
For the quarter ended December 31, 2007, revenue increased 4.4% to
$84.7 million, compared to $81.1 million for the quarter ended December 31,
2006. The quarterly operating results were negatively impacted by costs
related to the Company's proposed going private transaction. Operating
income for the fourth quarter 2007 decreased 16.1% to $10.0 million,
compared to $12.0 million for the same period in 2006. Income from
continuing operations for the fourth quarter 2007 was $5.1 million, or
$0.36 per diluted share, a 2.5% decrease from income from continuing
operations of $5.2 million, or $0.37 per diluted share, for the fourth
quarter of 2006. Net income was $5.1 million, or $0.36 per diluted share,
for the quarter ended December 31, 2007, compared to $5.4 million, or $0.38
per diluted share, for the same period in 2006.
The current period results were affected by the following:
- Professional fees were $1.7 million higher related to the proposed
going private transaction ($1.2 million, net of income taxes, or $0.08
per diluted share); and
- A more favorable income tax rate of 33.2% for the current quarter due
to FASB Interpretation No. 48 ("FIN 48") and deferred tax adjustments
compared to 47.1% for the prior year period, which was impacted by
deferred tax adjustments.
For the year ended December 31, 2007, revenue increased 4.0% to $340.7
million, compared to $327.5 million for the same period in 2006. The 2007
operating results were negatively impacted by costs related to the
Company's proposed going private transaction. Operating income increased
17.2% to $47.4 million, compared to $40.4 million for the year ended
December 31, 2006. Income from continuing operations was $23.5 million, or
$1.66 per diluted share, a 38.5% increase from income from continuing
operations of $17.0 million, or $1.21 per diluted share, for the year ended
December 31, 2006. Income from discontinued operations (net of income
taxes) was $0.2 million, or $0.01 per share, for the year ended December
31, 2007, compared to $2.3 million, or $0.16 per diluted share, for the
same period in 2006, primarily due to a gain on sale of the Company's
Jacksonville, Florida landfill operation in April 2006. Net income was
$23.7 million, or $1.67 per diluted share, for the year ended December 31,
2007, compared to $19.3 million, or $1.37 per diluted share, for the same
period in 2006.
The total year results were affected by the following:
- Professional fees were $1.9 million higher related to the proposed
going private transaction ($1.2 million, net of income taxes, or $0.08
per diluted share); and
- A more favorable income tax rate of 37.8% for 2007 due to FIN 48 and
deferred tax adjustments compared to 45.9% for 2006 which was impacted
by deferred tax adjustments.
Jim W. Perry, President and CEO of the Company, stated, "Our
performance for the fourth quarter and 2007 was in line with our
expectations. Going into 2008, we believe our operating fundamentals are
well established which should help us deal with the current sluggish
economy and our strong balance sheet should enable us to take advantage of
any strategic growth opportunities."
The Company will host a conference call to discuss its fourth quarter
results on March 5, 2008 at 2:00 PM (Eastern Time). The call number is
(877) 723-9519 and the confirmation number is 9954580. The conference call
will also be broadcast live over the Internet at
http://www.wasteindustries.com under the "Investor Relations" tab. A replay
of the call will be available through March 19, 2008 and may be accessed by
calling (888) 203-1112 and using confirmation number 9954580.
Waste Industries USA, Inc. is a vertically integrated solid waste
services company that provides collection, transfer, disposal and recycling
services to commercial, industrial and residential customer locations in
the states of North Carolina, South Carolina, Virginia, Tennessee,
Mississippi and Georgia.
This press release contains forward-looking statements under the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements can generally be identified as such because the statement will
include words such as the Company "believes," "anticipates," "expects" or
words of similar import. Similarly, statements that describe the Company's
future performance plans, objectives or goals are also forward-looking
statements. Forward- looking statements are subject to risks and
uncertainties, such as risks in the development and operation of landfills,
fuel prices, managing growth, economic trends and weather that could cause
actual results to differ materially from those currently anticipated.
Consider these factors carefully in evaluating the forward-looking
statements. Additional information concerning factors that could cause
actual results to differ materially from those in the forward-looking
statements is contained from time to time in the Company's SEC filings.
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2006 2007 2006 2007
Revenues:
Service revenues $80,761 $84,398 $326,447 $339,599
Equipment sales 358 260 1,098 1,069
Total revenues 81,119 84,658 327,545 340,668
Operating costs and expenses:
Operating (exclusive of
depreciation and
amortization shown below) 50,261 54,087 212,171 215,006
Cost of equipment sales 234 141 666 629
Selling, general and
administrative 10,712 12,761 43,167 47,509
Depreciation and
amortization 8,233 8,336 32,093 31,751
Gain on sale of property
and equipment and other
assets (500) (707) (1,189) (1,624)
Impairment of property and
equipment and other assets 208 - 223 16
Total operating costs
and expenses 69,148 74,618 287,131 293,287
Operating income 11,971 10,040 40,414 47,381
Interest expense 2,321 2,453 9,608 9,871
Interest income (49) (42) (181) (126)
Other (192) (3) (418) (193)
Total other expense, net 2,080 2,408 9,009 9,552
Income from continuing
operations before income
taxes 9,891 7,632 31,405 37,829
Income tax expense 4,662 2,532 14,416 14,301
Income from continuing
operations 5,229 5,100 16,989 23,528
Discontinued operations:
Income from discontinued
operations, net of income
taxes 147 6 2,292 153
Net income $5,376 $5,106 $19,281 $23,681
Earnings per share:
Basic:
Income from continuing
operations $0.38 $0.36 $1.22 $1.67
Income from discontinued
operations 0.01 - 0.17 0.01
Net income $0.39 $0.36 $1.39 $1.68
Diluted:
Income from continuing
operations $0.37 $0.36 $1.21 $1.66
Income from discontinued
operations 0.01 - 0.16 0.01
Net income $0.38 $0.36 $1.37 $1.67
Weighted-Average Number Of
Shares Outstanding:
Basic 13,951 14,158 13,871 14,088
Diluted 14,145 14,244 14,043 14,196
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
(Unaudited)
December 31, December 31,
2006 2007
ASSETS
Current assets:
Cash and cash equivalents $1,656 $4,361
Receivables, net 36,408 35,129
Other 5,013 12,332
Total current assets 43,077 51,822
Property and equipment, net 218,039 234,034
Intangible assets, net 104,950 118,766
Other noncurrent assets 4,213 4,411
Total assets $370,279 $409,033
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term
debt $7,143 $7,143
Accounts payable - trade 13,318 15,703
Other accrued liabilities and
deferred revenues 22,725 28,165
Total current liabilities 43,186 51,011
Long-term debt, net of current
maturities 150,069 157,926
Deferred taxes and related
contingencies 23,513 27,121
Other long-term liabilities 7,640 9,586
Total liabilities 224,408 245,644
Shareholders' equity: 145,871 163,389
Total liabilities and
shareholders' equity $370,279 $409,033
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
Twelve Months Ended
December 31,
2006 2007
Operating Activities:
Net income $19,281 $23,681
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 32,220 31,751
Landfill accretion expense 824 727
Amortization of debt issuance
costs 513 409
Impairment of property,
equipment and other assets 223 16
Gain on sale of property,
equipment and other assets (1,189) (1,624)
Gain on sale of discontinued
collection and disposal
operations (2,282) (153)
Stock compensation expense 612 867
Deferred income taxes 2,381 1,963
Change in fair value of
commodity hedges 644 1,224
Provision for doubtful accounts 1,557 2,022
Changes in assets and liabilities,
net of effects from acquisition and
disposition of operations (9,718) 3,457
Net cash provided by
operating activities 45,066 64,340
Investing Activities:
Acquisitions of operations (6,190) (24,171)
Purchases of property and equipment (41,154) (36,886)
Proceeds from sale of discontinued
collection and disposal operations 16,354 270
Proceeds from sale of property,
equipment and other assets 2,209 2,936
Increase in restricted cash (728) (6,621)
Other (179) (109)
Net cash used in investing
activities (29,688) (64,581)
Financing Activities:
Proceeds from issuance of long-term
debt 44,000 72,000
Principal payments of long-term
debt (55,245) (64,143)
Payment of dividends (5,283) (7,198)
Principal payments of capital lease
obligations (441) (213)
Financing costs (579) (191)
Excess tax benefit from stock
option exercises 346 302
Net proceeds from exercise of stock
options 1,905 2,389
Net cash provided by (used in)
financing activities (15,297) 2,946
Increase in cash and cash
equivalents 81 2,705
Cash and cash equivalents,
beginning of period 1,575 1,656
Cash and cash equivalents, end of
period $1,656 $4,361
Supplemental disclosures of cash flow
information:
Cash paid for interest, net of
capitalized interest $9,042 $10,699
Cash paid for income taxes $18,383 $13,209
EARNINGS RELEASE - SUPPLEMENTAL DATA (dollars in thousands)
REVENUE Margins 12/31/06 12/31/07
Operating expenses including cost of
equipment sales 65.0% 63.3%
S G & A 13.2% 13.9%
Depreciation and amortization 9.8% 9.3%
Interest expense, net 2.9% 2.9%
Income from continuing operations
(pre-tax) 9.6% 11.1%
Income tax expense 4.4% 4.2%
Income from continuing operations 5.2% 6.9%
SERVICE REVENUE MIX
Collection:
Industrial $89,933 $88,241
Commercial 91,555 96,221
Residential 74,933 81,218
Disposal and transfer 46,285 48,375
Recycling service 4,719 4,422
Recycled commodity sales 3,941 4,739
Other 15,081 16,383
Total Service Revenue $326,447 $339,599
OPERATING INCOME BEFORE DEPRECIATION,
AMORTIZATION AND ACCRETION*
Operating income $40,414 $47,381
Accretion 824 727
Depreciation and amortization 32,093 31,751
Operating income before
depreciation, amortization
and accretion $73,331 $79,859
CAPITAL EXPENDITURES DETAIL YTD 06 YTD 07
Collection & Transportation $29,432 $22,244
Landfill Development 11,722 14,642
Total capital expenditures $41,154 $36,886
FREE CASH FLOW RECONCILIATION *
Net cash provided by operating
activities $45,066 $64,340
Less: Capital expenditures (41,154) (36,886)
Plus: Proceeds from disposal of
assets 2,209 2,936
Free cash flow $6,121 $30,390
DEBT TO TOTAL CAPITAL 12/31/06 12/31/07
(includes capital leases) 51.9% 50.3%
TOTAL LIABILITIES TO
EQUITY 1.5 1.5
DAYS SALES OUTSTANDING 34 28
SERVICE REVENUE GROWTH Q4 2007 YTD 2007
Price -0.1% 2.2%
Volume -0.1% -1.5%
Energy surcharge 1.7% 0.3%
Total internal growth 1.5% 1.0%
Recycling commodities -0.2% 0.2%
Acquisitions 3.2% 2.8%
Total service revenue growth 4.5% 4.0%
* Operating income before depreciation, amortization and accretion and
free cash flow are considered non-GAAP financial measures. The Company
defines free cash flow as cash flows from operating activities less
capital expenditures plus proceeds from the sale of property and
equipment and other assets. Operating income before depreciation,
amortization and accretion and free cash flow do not represent, and
should not be considered as, an alternative to net income or cash flows
from operating, investing and financing activities, each as determined
in accordance with GAAP. The Company's definitions of operating income
before depreciation, amortization and accretion and free cash flow might
not be comparable to similarly titled measures reported by other
companies. The Company believes that the presentation of operating
income before depreciation, amortization and accretion is useful to
investors because it provides important information of the Company's
operating performance exclusive of certain non-cash costs. The Company
has included information concerning free cash flow because it believes
it provides additional information for determining its ability to meet
debt service requirements and that this measure is an indicator upon
which the Company, its lenders and some investors assess its financial
performance and its capacity to service debt. The Company therefore
interprets free cash flow trends as a measure of its liquidity.
SOURCE Waste Industries USA, Inc.
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Related links:
http://www.waste-ind.com/
http://www.prnewswire.com/comp/120685.html/
CONTACT:
Carol Dalton of Waste Industries USA, Inc.,
+1-919-325-3000
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