During Q2 Republic Revenues Surge; Covanta Posts EBITDA Gains
Republic's revenue increased 7.5 percent over the prior year, the company's highest level of growth in more than eight years.
Republic Services and Covanta Holding Corp. each reported strong operational results during the second quarter in earnings reports reported yesterday after stock markets had closed.
Republic Sees Strong Growth
Phoenix-based Republic Services posted revenues of $2.53 billion in the second quarter—up from $2.35 billion in the same period a year ago. Total revenue increased 7.5 percent over the prior year, the company's highest level of growth in more than eight years.
The company also reported net income of $202.9 million versus $180.8 million for the comparable 2016 period. Excluding certain gains and expenses, on an adjusted basis, net income for the period was $205.9 million, versus $189.5 million in 2016.
“It’s a broad-based recovery. It’s across all lines. It’s across all areas of the business. … I’m pumped,” Republic President and CEO Donald Slager said during a conference call with investors.
MSW volume growth did lag some of the other waste categories, but Slager explained that it fit with the overall shape of the recovery in the sector.
“We’ve always said we’re in a slow growth business,” he said. “It depends on population growth, and housing formation. Those dynamics are consistent and strong. But we’re only at 1.2 million in terms of household formation. There is still room to grow as that gets back to a new norm.”
Slager also said the company was pleased with its retention levels for drivers and technicians.
“Especially in a time with construction jobs growing, we‘re holding on to our people,” he said.
The company was recently named to the Forbes 2017 America's Best Large Employers list, an elite employer ranking based on the results of an independent survey conducted among 30,000 U.S. workers at companies and institutions across the country, as well as a recipient of the Glassdoor Employees' Choice Award which is based on employee reviews about Republic Services on Glassdoor.com.
Slager also addressed China’s recent notification to the World Trade Organization of plans to ban 24 types of solid waste imports. Like Waste Management CEO Jim Fish, Slager said he expected the impacts to be muted.
“This is not the first time we’ve seen this kind of thing from China,” Slager said. “We’ve been through this a number of times. We have a high quality pack that we make. We’ve never had an issue with quality rejection. … We’ve never had a slowdown in shipping our materials.”
Slager also noted that only about 35 percent of Republic’s recycled materials go to China.