RALEIGH, N.C., Aug. 1 /PRNewswire-FirstCall/ -- Waste Industries USA,
Inc. (Nasdaq: WWIN), a regional, non-hazardous solid waste services
company, today reported preliminary financial results for the second
quarter ended June 30, 2006.
For the quarter ended June 30, 2006, revenue increased 8.8% to $82.6
million, compared to $75.9 million for the quarter ended June 30, 2005.
Operating income for the second quarter 2006 increased 69.2% to $9.6
million, compared to $5.7 million for the same period in 2005. Income from
continuing operations for the second quarter 2006 was $4.5 million, or
$0.32 per diluted share, a 136.6% increase from income from continuing
operations of $1.9 million, or $0.14 per diluted share, for the second
quarter of 2005. Income from discontinued operations (net of income taxes)
was $2.3 million, or $0.16 per diluted share, for the second quarter of
2006, compared to $0.5 million, or $0.03 per diluted share for the same
period in 2005.
For the six months ended June 30, 2006, revenue increased 12.2% to
$161.7 million, compared to $144.2 million for the same period in 2005.
Operating income increased 38.7% to $17.4 million, compared to $12.5
million for the six months ended June 30, 2005. Income from continuing
operations was $7.9 million, or $0.56 per diluted share, a 69.3% increase
from income from continuing operations of $4.7 million, or $0.34 per
diluted share, for the six months ended June 30, 2005. Income from
discontinued operations (net of income taxes) was $2.3 million, or $0.17
per diluted share, for the six months ended June 30, 2006, compared to $0.5
million, or $0.04 per diluted share, for the same period in 2005.
Jim W. Perry, President and CEO of the Company, stated, "The results of
operations for the quarter and year-to-date reflect our continued focus on
improving productivity, reducing operating cost and effectively pricing
collection and disposal work to reflect the rising cost of labor, fuel,
steel and regulatory requirements. Our results also reinforce our previous
strategy to divest underperforming operations while concentrating our
resources and energies in markets where we can be successful at
internalizing more of our waste stream and where we can further leverage
our extensive asset base and infrastructure."
All periods have been restated to present the results of certain
discontinued operations in the Atlanta area market and the Old Kings Road
construction and demolition landfill operation in Jacksonville, Florida.
Included in income from discontinued operations for the three and six
months ended June 30, 2006 is a gain of approximately $2.2 million (net of
income taxes) related to the sale of the Jacksonville landfill operation.
The Company will host a conference call to discuss its second quarter
results on August 2, 2006 at 2:00 P.M. (Eastern Time). The call number is
(800) 946-0742 and the confirmation number is 7498454. The conference call
will also be broadcast live over the Internet at http://www.waste-ind.com
under the "Investor Relations" tab. A replay of the call will be available
through August 16, 2006 and may be accessed by calling (888) 203-1112 and
using confirmation number 7498454.
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 fuel prices, risks in the development and operation
of landfills, 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 Six Months Ended
June 30, June 30,
2005 2006 2005 2006
Revenues:
Service revenues $75,774 $82,340 $143,847 $161,300
Equipment sales 157 259 311 446
Total revenues 75,931 82,599 144,158 161,746
Operating costs and expenses:
Operating (exclusive of
depreciation and
amortization shown below) 52,149 54,651 97,430 106,242
Cost of equipment sales 95 157 201 286
Selling, general and
administrative 10,800 10,552 19,885 22,226
Depreciation and
amortization 7,377 7,949 14,186 15,998
Gain on sale of property
and equipment and other
assets (198) (336) (222) (386)
Impairment of property and
equipment and other assets 17 - 143 -
Total operating costs
and expenses 70,240 72,973 131,623 144,366
Operating income 5,691 9,626 12,535 17,380
Interest expense 2,619 2,360 4,961 4,908
Interest income (21) (49) (32) (95)
Other (60) (62) (81) (150)
Total other expense, net 2,538 2,249 4,848 4,663
Income from continuing
operations before income
taxes 3,153 7,377 7,687 12,717
Income tax expense 1,246 2,865 3,037 4,844
Income from continuing
operations 1,907 4,512 4,650 7,873
Discontinued operations:
Income from discontinued
operations, net of income
taxes 514 2,250 542 2,279
Net income $2,421 $6,762 $5,192 $10,152
Earnings per share:
Basic:
Income from continuing
operations $0.14 $0.33 $0.34 $0.57
Income from discontinued
operations 0.04 0.16 0.04 0.17
Net income $0.18 $0.49 $0.38 $0.74
Diluted:
Income from continuing
operations $0.14 $0.32 $0.34 $0.56
Income from discontinued
operations 0.03 0.16 0.04 0.17
Net income $0.17 $0.48 $0.38 $0.73
Weighted-Average Number Of
Shares Outstanding:
Basic 13,675 13,857 13,606 13,809
Diluted 13,853 14,029 13,798 13,951
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
(Unaudited)
December 31, June 30,
2005 2006
ASSETS
Current assets:
Cash and cash equivalents $1,575 $106
Receivables, net 36,193 34,585
Other 4,120 9,263
Total current assets 41,888 43,954
Property and equipment, net 216,390 215,599
Intangible assets, net 105,925 105,569
Other noncurrent assets 3,952 3,868
Total assets $368,155 $368,990
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of
long-term debt 10,733 8,945
Accounts payable - trade 16,579 16,181
Other accrued liabilities
and deferred revenues 29,223 30,545
Total current
liabilities 56,535 55,671
Long-term debt, net of
current maturities 155,212 147,069
Other liabilities 26,909 27,579
Total liabilities 238,656 230,319
Shareholders' equity: 129,499 138,671
Total liabilities and
shareholders' equity $368,155 $368,990
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
Six Months Ended
June 30,
2005 2006
Operating Activities:
Net income $5,192 $10,152
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 14,706 16,124
Landfill accretion expense 209 538
Amortization of debt issuance
costs 559 309
Impairment of property and
equipment and other assets 143 -
Gain on sale of property and
equipment and other assets (222) (386)
Gain on sale of discontinued
collection and disposal
operations (389) (2,270)
Stock compensation expense 44 290
Provision for deferred income
taxes 1,570 (518)
Change in fair value of
commodity hedges - 914
Provision for doubtful accounts 1,454 755
Changes in assets and liabilities,
net of effects from acquisition
and disposition of related
businesses (941) (4,009)
Net cash provided by
operating activities 22,325 21,899
Investing Activities:
Acquisitions of related business,
net of cash acquired (23,279) (5,033)
Purchases of property and equipment (16,031) (21,143)
Proceeds from sale of collection
and disposal operations 7,913 16,352
Proceeds from sale of property and
equipment and other assets 720 1,032
Settlement of acquisition
liabilities 92 (208)
Other 43 182
Net cash used in investing
activities (30,542) (8,818)
Financing Activities:
Proceeds from issuance of long-term
debt 27,962 16,000
Principal payments of long-term
debt (22,719) (28,443)
Payment of dividends (1,094) (2,493)
Principal payments of capital lease
obligations (101) (361)
Debt issuance costs (35) (582)
Excess tax benefit from stock
option exercises - 142
Net proceeds from exercise of stock
options 1,812 1,187
Net cash (used in) provided by
financing activities 5,825 (14,550)
Decrease in cash and cash
equivalents (2,392) (1,469)
Cash and cash equivalents,
beginning of period 2,445 1,575
Cash and cash equivalents, end of
period $53 $106
Supplemental disclosures of cash flow
information:
Cash paid for interest $4,568 $5,246
Cash paid for taxes $3,348 $8,150
EARNINGS RELEASE - SUPPLEMENTAL DATA (dollars in thousands)
QUARTER ENDED
REVENUE MARGINS 6/30/05 6/30/06
Operating expenses including
cost of equipment sales 68.8% 66.4%
S G & A 14.2% 12.8%
Depreciation and amortization 9.7% 9.6%
Interest expense, (net) 3.4% 2.8%
Income from continuing
operations (pre-tax) 4.2% 8.9%
Income tax expense 1.6% 3.5%
Income from continuing
operations 2.5% 5.5%
SERVICE REVENUE MIX
Collection:
Industrial $22,041 $22,984
Commercial 20,688 22,995
Residential 16,386 18,121
Disposal and transfer 11,335 11,984
Recycling service 1,226 1,200
Recycled commodity sales 1,124 922
Other 2,974 4,134
Total Service Revenue $75,774 $82,340
OPERATING INCOME BEFORE DEPRECIATION,
AMORTIZATION AND ACCRETION*
Operating income $5,691 $9,626
Accretion 103 122
Depreciation and amortization 7,377 7,949
Operating income before
depreciation,
amortization and accretion $13,171 $17,697
CAPITAL EXPENDITURES DETAIL YTD 05 YTD 06
Collection & Transportation $11,150 $14,982
Landfill Development 4,881 6,161
Total capital expenditures $16,031 $21,143
FREE CASH FLOW RECONCILIATION*
Net cash provided by operating
activities $22,325 $21,899
Less: Capital expenditures (16,031) (21,143)
Plus: Proceeds from disposal of
assets 720 1,032
Free cash flow $7,014 $1,788
DEBT TO TOTAL CAPITAL 12/31/05 6/30/06
(includes capital leases) 56.3% 53.0%
TOTAL LIABILITIES TO EQUITY 1.8 1.7
DAYS SALES OUTSTANDING 34 32
SERVICE REVENUE GROWTH 2Q 06
Price 4.4%
Volume -3.1%
Energy surcharge 2.2%
Total internal growth 3.5%
Recycling commodities -0.3%
Acquisitions 5.5%
Total service revenue growth 8.7%
* 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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