RALEIGH, N.C., Oct. 31 /PRNewswire-FirstCall/ -- Waste Industries USA,
Inc. (Nasdaq: WWIN), a regional, non-hazardous solid waste services
company, today reported preliminary financial results for the third quarter
ended September 30, 2006.
For the quarter ended September 30, 2006, revenue increased 4.1% to
$84.7 million, compared to $81.3 million for the quarter ended September
30, 2005. Operating income for the third quarter 2006 increased 51.5% to
$11.1 million, compared to $7.3 million for the same period in 2005. Income
from continuing operations for the third quarter 2006 was $3.9 million, or
$0.28 per diluted share, a 31.6% increase from income from continuing
operations of $3.0 million, or $0.21 per diluted share, for the third
quarter of 2005. Net income for the third quarter was $3.8 million, or
$0.27 per diluted share, a 23.5% increase from net income of $3.0 million,
or $0.22 per diluted share, for the third quarter of 2005. The current
period results were affected by a higher than anticipated effective tax
rate of 55.8%, compared to 41.0% in the year-ago period. This increase was
primarily due to an adjustment of $1.2 million, or approximately $0.09 per
diluted share, to accrued deferred tax liabilities resulting from an
increase in the Company's estimated deferred tax rate.
For the nine months ended September 30, 2006, revenue increased 9.3% to
$246.4 million, compared to $225.5 million for the same period in 2005.
Operating income increased 43.4% to $28.4 million, compared to $19.8
million for the nine months ended September 30, 2005. Income from
continuing operations was $11.8 million, or $0.84 per diluted share, a
54.7% increase from income from continuing operations of $7.6 million, or
$0.55 per diluted share, for the nine months ended September 30, 2005.
Income from discontinued operations (net of income taxes) was $2.1 million,
or $0.15 per diluted share, for the nine months ended September 30, 2006,
compared to $0.6 million, or $0.05 per diluted share, for the same period
in 2005. Net income for the nine months ended September 30, 2006 was $13.9
million, or $0.99 per diluted share, a 68.9% increase from net income of
$8.2 million, or $0.60 per diluted share, for the nine months ended
September 30, 2005.
Jim W. Perry, President and CEO of the Company, stated, "Our
performance for the third quarter reflects our continuing focus on
optimizing our assets, reducing our G&A expenses and improving the pricing
for our core services. Our strategy to internalize more of our waste stream
into our landfills also had a positive impact on our operating results for
the quarter and year-to- date."
The Company will host a conference call to discuss its third quarter
results on November 1, 2006 at 2:00 PM (Eastern Time). The call number is
(800) 946-0715 and the confirmation number is 4598428. 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 November 8, 2006 and may be accessed by calling (888) 203-1112 and
using confirmation number 4598428.
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 Nine Months Ended
September 30, September 30,
2005 2006 2005 2006
Revenues:
Service revenues $81,198 $84,387 $225,045 $245,687
Equipment sales 150 294 461 740
Total revenues 81,348 84,681 225,506 246,427
Operating costs and expenses:
Operating (exclusive of
depreciation and
amortization shown below) 55,466 55,670 152,895 161,909
Cost of equipment sales 83 145 287 432
Selling, general and
administrative 11,120 10,228 31,004 32,455
Depreciation and
amortization 7,598 7,862 21,785 23,860
Gain on sale of property
and equipment and other
assets (223) (303) (447) (688)
Impairment of property and
equipment and other assets - 15 143 15
Total operating costs
and expenses 74,044 73,617 205,667 217,983
Operating income 7,304 11,064 19,839 28,444
Interest expense 2,434 2,379 7,395 7,287
Interest income (29) (36) (61) (131)
Other (110) (76) (191) (226)
Total other expense, net 2,295 2,267 7,143 6,930
Income from continuing
operations before income taxes 5,009 8,797 12,696 21,514
Income tax expense 2,055 4,910 5,092 9,754
Income from continuing
operations 2,954 3,887 7,604 11,760
Discontinued operations:
Income (loss) from
discontinued operations,
net of income taxes 86 (134) 628 2,145
Net income $3,040 $3,753 $8,232 $13,905
Earnings per share:
Basic:
Income from continuing
operations $0.21 $0.28 $0.56 $0.85
Income from discontinued
operations 0.01 (0.01) 0.04 0.15
Net income $0.22 $0.27 $0.60 $1.00
Diluted:
Income from continuing
operations $0.21 $0.28 $0.55 $0.84
Income from discontinued
operations 0.01 (0.01) 0.05 0.15
Net income $0.22 $0.27 $0.60 $0.99
Weighted-Average Number Of
Shares Outstanding:
Basic 13,706 13,910 13,640 13,844
Diluted 13,852 14,072 13,811 14,025
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
(Unaudited)
December 31, September 30,
2005 2006
ASSETS
Current assets:
Cash and cash equivalents $1,575 $1,768
Receivables, net 36,193 35,647
Other 4,120 8,007
Total current assets 41,888 45,422
Property and equipment, net 216,390 218,977
Intangible assets, net 105,925 105,642
Other noncurrent assets 3,952 3,935
Total assets $368,155 $373,976
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt 10,733 7,868
Accounts payable - trade 16,579 15,621
Other accrued liabilities and deferred
revenues 29,223 25,831
Total current liabilities 56,535 49,320
Long-term debt, net of current maturities 155,212 153,069
Other liabilities 26,909 29,960
Total liabilities 238,656 232,349
Shareholders' equity: 129,499 141,627
Total liabilities and shareholders'
equity $368,155 $373,976
WASTE INDUSTRIES USA, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
Nine Months Ended
September 30,
2005 2006
Operating Activities:
Net income $8,232 $13,905
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 22,463 24,026
Landfill accretion expense 305 688
Amortization of debt issuance costs 762 411
Impairment of property and
equipment and other assets 143 15
Gain on sale of property and
equipment and other assets (447) (688)
Gain on sale of discontinued
collection and disposal operations (389) (2,135)
Stock compensation expense 60 452
Provision for deferred income taxes 3,002 548
Change in fair value of commodity hedges - 932
Provision for doubtful accounts 1,651 1,139
Changes in assets and liabilities,
net of effects from acquisition and
disposition of related businesses (3,104) (6,717)
Net cash provided by
operating activities 32,678 32,576
Investing Activities:
Acquisitions of related business,
net of cash acquired (28,618) (5,763)
Purchases of property and equipment (27,382) (33,871)
Proceeds from sale of collection
and disposal operations 7,913 16,352
Proceeds from sale of property and
equipment and other assets 1,995 1,645
Settlement of acquisition liabilities (655) (475)
Other 16 140
Net cash used in investing activities (46,731) (21,972)
Financing Activities:
Proceeds from issuance of long-term debt 47,697 30,023
Principal payments of long-term debt (35,415) (37,542)
Payment of dividends (2,191) (3,887)
Principal payments of capital lease
obligations (150) (397)
Debt issuance costs (60) (580)
Excess tax benefit from stock
option exercises - 263
Net proceeds from exercise of stock options 1,874 1,709
Net cash (used in) provided by
financing activities 11,755 (10,411)
(Decrease) increase in cash and
cash equivalents (2,298) 193
Cash and cash equivalents, beginning of
period 2,445 1,575
Cash and cash equivalents, end of period $147 $1,768
Supplemental disclosures of cash flow
information:
Cash paid for interest $6,961 $7,592
Cash paid for taxes $3,508 $14,888
EARNINGS RELEASE - SUPPLEMENTAL DATA (dollars in thousands)
QUARTER ENDED
REVENUE MARGINS 9/30/05 9/30/06
Operating expenses including cost of
equipment sales 68.3% 65.9%
S G & A 13.7% 12.1%
Depreciation and amortization 9.3% 9.3%
Interest expense, (net) 3.0% 2.8%
Income from continuing operations (pre-tax) 6.2% 10.4%
Income tax expense 2.5% 5.8%
Income from continuing operations 3.6% 4.6%
SERVICE REVENUE MIX
Collection:
Industrial $23,052 $22,983
Commercial 22,070 23,178
Residential 17,963 19,376
Disposal and transfer 12,038 12,209
Recycling service 1,197 1,161
Recycled commodity sales 1,206 1,421
Other 3,672 4,059
Total Service Revenue $81,198 $84,387
OPERATING INCOME BEFORE DEPRECIATION,
AMORTIZATION AND ACCRETION*
Operating income $7,304 $11,064
Accretion 96 150
Depreciation and amortization 7,598 7,862
Operating income before depreciation,
amortization and accretion $14,998 $19,076
CAPITAL EXPENDITURES DETAIL YTD 05 YTD 06
Collection & Transportation $20,712 $25,347
Landfill Development 6,670 8,524
Total capital expenditures $27,382 $33,871
FREE CASH FLOW RECONCILIATION *
Net cash provided by operating activities $32,678 $32,576
Less: Capital expenditures (27,382) (33,871)
Plus: Proceeds from disposal of assets 1,995 1,645
Free cash flow $7,291 $350
DEBT TO TOTAL CAPITAL 12/31/05 9/30/06
(includes capital leases) 56.3% 53.2%
TOTAL LIABILITIES TO EQUITY 1.8 1.6
DAYS SALES OUTSTANDING 34 32
SERVICE REVENUE GROWTH 3Q 06
Price 4.4%
Volume -3.8%
Energy surcharge 1.1%
Total internal growth 1.7%
Recycling commodities 0.2%
Acquisitions 2.0%
Total service revenue growth 3.9%
* 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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