WM Q2 2024 Earnings Show Strong M&A Activity, Core Price of 6.8 Percent

During a quarterly earnings call, CEO Jim Fish reported that strong operating performance contributed to solid growth for WM in Q2 2024.

The company showed double-digit operating revenue growth in the second quarter, which aligns with achieving the outlook provided in Q1 2024. Revenue grew 5.5 percent in Q2.

“Based on our great performance to start 2024 and our confidence in the strength of our business, after the first quarter we raised our full-year outlook for adjusted operating EBITDA and free cash flow by $100 million," Fish said. "Our second quarter results are tracking to this higher trajectory and reflect continued momentum on our pricing programs and cost optimization efforts in our collection and disposal business.

For the first time ever, WM reached a quarterly operating EBITDA margin of 30 percent, attributed to a focus on operational efficiencies from tech investments and pricing strategy.

WM completed $750 in merger and acquisition activity through the first half of 2024, most recently completing the purchase of Long Island-based Winters Bros.

"These transactions strengthen our core collection and disposal operations in North America in new geographies, like Long Island, New York, and complement existing operations through tuck-in acquisitions in growth markets in Florida, North Carolina, and Arizona," Fish said.

Fish discussed the "momentum" of WM's sustainability line of business. The company expects to have five new renewable natural gas projects online in 2024, adding to two facilities completed in the past two years.

"We have another nine projects and active construction, with construction beginning are expected to begin on the remaining four facilities later this year," Fish indicated," ....we're excited about the progress we're making. investing directly in building our renewable natural gas platform meets all our investment criteria. We're driving strong returns with expected payback periods of three or four years at better multiples than traditional M&A. Plus, we're expanding environmental benefits by collecting and beneficially using more landfill gas."

Q2 2024 Highlights

Revenue: $5.4 billion
Operating EBITDA: $1.5 billion
Net income: $680 million