Waste Connections Q4, Full-Year Results Exceed Expectations

Waste Connections reported 11.6 percent Q4 2022 revenue growth, driven by price-led organic growth and strong acquisition activity that positions the company at a "higher entry point" for 2023.

As the company finished its 25th year, it continued to outperform based on operational execution and more than 10 percent solid waste pricing.

"We more than offset inflationary pressures and commodity-related headwinds to expand adjusted EBITDA* margin by 30 basis points, excluding the margin dilutive impact of acquisitions completed since the year-ago period," said Worthing F. Jackman, President and CEO.

Q4 2022 revenue reached $1.869 billion, up from $1.624 billion in 2021. Operating income totaled $312 million, which was up from $249.3 million in the previous year. 

Adjusted net income in Q4 was $229 million, up from $217 million in the previous year. Adjusted EBITDA totaled $563.6 million, up from $495.4 million in 2021. Jackman also provided an outlook into 2023.

"We've been navigating the uncertainties and manufacturer delivery time and now expect to take delivery of an additional 50 million in fleet in 2023," Jackman noted. "That was originally expected in 2020 to 2022."

Revenue for the full-year 2022 was $7.2 billion, up from $6.15 billion in 2021. Net income reached $835.7 million, up from $618 million in the prior year.

Adjusted net income^(b) for the year ended December 31, 2022 was $985.3 million, or $3.82 per diluted share, as compared to $846.6 million, or $3.23 per diluted share, in the year ago period. Adjusted EBITDA^(b) for the year ended December 31, 2022 was $2.221 billion, up from $1.919 billion in the prior year period.

Waste Connections projected revenue of $8 billion in 2023.

Mr. Jackman concluded, "Our 2022 results are a testament to the culture of accountability that has been integral to Waste Connections' 25-year history of outperformance and value creation. The tireless efforts of our over 22,000 dedicated employees have positioned us for double-digit revenue growth and additional adjusted EBITDA margin expansion in 2023 in spite of an expected 100 basis points margin headwind at current recovered commodity values, with upside from any improvement in these values or inflationary pressures, as well as any additional acquisition activity."

Q4 Highlights:
Revenue: $1.869 billion
Net income: $194.4 million
Operating income: $312 million
Adjusted EBITDA: $562 million

Full-Year Highlights:
Revenue: $7.2 billion
Net income: $835.7 million
Operating income: $312 million
Adjusted EBITDA: $2.2 billion