Waste Connections Q1 2024 Financial Results Details Strong Start to the Year

Waste Connections, Inc. (Waste Connections) announced its 2024 first-quarter earnings report this week, noting its excitement for the company’s strong start to the year.

After the completion of the quarter, Waste Connections is reporting its revenue at $2.073 billion, which is up 9.1 percent year over year after 2023’s first quarter revenue was $1.901 billion. This number is roughly $23 million above the company’s outlook which it attributed to incremental acquisition contributions. Net income for the quarter was $230.1 million with an adjusted EBITDA of $650.7 million, which was above the company’s outlook and up 14.8 percent from last year’s first quarter.

"We are extremely pleased by the strong start to the year driving better than expected operating and financial results, which, along with recently completed acquisitions, positions us well for the remainder of 2024,” said Ronald J. Mittelstaedt, President and Chief Executive Officer.

“Adjusted EBITDA margin expansion of 160 basis points to 31.4% in the seasonally weakest quarter of the year puts us on track to exceed our industry-leading full-year outlook of 32.7%, as continuing improvements in employee retention and safety trends, along with rising commodity values, provide momentum for continued outperformance.”

Mittelstaedt mentions that he’s impressed with his company’s performance despite significant weather impacts at the beginning of the year.

Operating income for the company finished the quarter at $366.8 million, including $11.5 million in transaction-related expenses and fair value accounting changes that were associated with equity awards. For the first quarter of 2023, operating income was $314.7 million, meaning Waste Connections saw a sizeable increase of $52.1 million.

During the conference call, Mittelstaedt said that he is happy with improvements in employee retention, leading to the company’s best safety performance in years. Waste Connections saw its monthly incidents fall to three-year lows despite the employee growth from acquisitions in the first quarter.

"These results reflect the value of our decentralized operating model and our commitment to a culture of accountability,” said Mittelstaedt.

Back in February, Waste Connections completed the acquisition of Secure Energy Service Inc. and its 30 energy waste treatment and disposal facilities located in Western Canada. The acquisition price was reported to be CAD$1.075 billion. Solid waste acquisitions totaled approximately $150 million in annualized revenue, which includes serving new customers in Indiana and Michigan with a new market entry.

“The strength of our financial position and free cash flow generation provide flexibility for continued acquisition outlays in 2024 for what could be one of our busiest years ever, along with increasing return of capital to shareholders,” said Mittelstaedt.

Waste Connections estimates its revenue to be in the range of $2.2 to $2.225 billion in the second quarter of 2024.

Q1 2024

Net Income: $230.1 million

Adjusted EBITDA: $650.7 million

Revenue: $2.073 billion

Adjusted Free Cash Flow: $324.8 million