Solid waste companies see large third-quarter gains
Several publicly traded waste companies saw encouraging jumps in their third-quarter 2008 earnings reports.
Houston-based Waste Management saw a 12 percent increase in profits for the quarter, reporting a net income of $310 million on revenues of $3.5 billion. For the same quarter in 2007, the company reported a net income of $278 million on revenues of $3.4 billion.
Fort Lauderdale, Fla.-based Republic Services reported an even bigger jump in profits. The company reported a net income of $88.7 million for the quarter on revenues of $834 million, which is a 32 percent increase from a net income of $67 million on revenues of $806 million for the same quarter last year.
In press release to their shareholders, both companies cited their pricing practices and operations as major reasons that they remain on target for their earnings and cash flow goals despite the current state of the economy and trash volumes.
Phoenix-based Allied Waste, which is slated to merge with Republic in the fourth quarter, reported a similar jump with a net income of $113 million for the quarter on revenues of $1.6 billion, compared to a net income of $27.2 million on revenues of $1.6 billion for the same quarter in 2007. "By remaining focused on our strategic, long-term performance metrics including pricing, operating efficiencies and cash flow, while rapidly adjusting our operations to near-term economic challenges, Allied Waste has reported strong financial performance," said John Zilmer, chairman and CEO of Allied, in a press release.
Folsom, Calif.-based Waste Connections also credited its operations and pricing procedures with offsetting rising fuel costs and a weakening economy. For the quarter, the company reported a net income of $28.3 million on revenues of $273 million, compared to a net income of $28.7 million on revenues of $251 million for the same quarter the previous year.
"Our recently completed equity and note offerings provide us the strongest balance sheet in our sector and uniquely position us with the available capital necessary to fund additional acquisitions, which may include divestitures resulting from the potential merger between Republic Services and Allied Waste," said Ron Mittelstaedt, CEO of Waste Connections, in a press release.