10-KPeriod: FY2011

REPUBLIC SERVICES, INC. Annual Report, Year Ended Dec 31, 2011

Filed February 17, 2012For Securities:RSG

Summary

Republic Services, Inc. (RSG) reported $8.2 billion in revenue for the year ending December 31, 2011. The company, a leading provider of non-hazardous solid waste services, demonstrated stable revenue performance year-over-year. Key financial highlights include operating income of $1.55 billion and net income of $589.2 million, resulting in diluted earnings per share of $1.56. The company continued its focus on shareholder value through a robust cash utilization strategy, including significant share repurchases totaling $500.8 million during the year and a consistent quarterly dividend, which was increased to $0.22 per share. Furthermore, Republic Services maintained a strong balance sheet and investment-grade credit ratings, underscoring its financial stability and operational efficiency. The company is well-positioned with a strong integrated platform and a clear strategy for targeted profitable growth, supported by an experienced management team. The company's operating strategy emphasizes leveraging its integrated platform, which includes 334 collection operations, 194 transfer stations, and 191 active landfills across 39 states and Puerto Rico. A significant portion of its revenue (75%) is derived from collection services, with residential, commercial, and industrial segments contributing significantly. The company's emphasis on internalization, where collected waste is disposed of at company-owned or operated landfills, reached approximately 66-68% over the past three years, contributing to operational efficiencies. Republic Services also highlighted its commitment to safety, people, durability through fleet modernization and automation, customer experience enhancement via technology, and targeted profitable growth through price and volume increases, strategic acquisitions, and development activities. The company provided guidance for 2012, anticipating revenue growth of 1.5% to 2.0% and adjusted diluted earnings per share between $1.98 and $2.02.

Financial Highlights

54 data points
Beta

Revenue

$8.19B

40.6% Gross Margin

Net Income

$589.20M

7.2% Net Margin

EPS (Diluted)

$1.56

Total Assets

$19.55B

Cash & Equivalents

$66.30M

Free Cash Flow

$830.20M

Financial Statements
Beta
Revenue$8.19B
Cost of Revenue$4.87B
Gross Profit$3.33B
SG&A Expenses$825.40M
Operating Income$1.55B
Interest Expense$440.20M
Net Income$589.20M
EPS (Basic)$1.57
EPS (Diluted)$1.56
Shares Outstanding (Basic)375.96M
Shares Outstanding (Diluted)377.61M

Key Highlights

  • 1Generated $8.19 billion in revenue for the fiscal year 2011, showing stability.
  • 2Reported operating income of $1.55 billion and net income of $589.2 million.
  • 3Achieved diluted earnings per share of $1.56.
  • 4Repurchased $500.8 million of its common stock under its repurchase program during the year.
  • 5Increased its quarterly cash dividend to $0.22 per share.
  • 6Maintained an integrated operating platform with 334 collection operations, 194 transfer stations, and 191 active landfills.
  • 7Continued to focus on internal growth, acquisitions, dividends, share repurchases, and maintaining a strong capital structure.

Frequently Asked Questions

Republic Services demonstrated stable financial performance in 2011, reporting $8.19 billion in revenue and $589.2 million in net income, which translated to $1.56 in diluted earnings per share. The company maintained strong operating income at $1.55 billion and continued its commitment to shareholder returns through dividends and share repurchases.

The company's growth strategy focuses on targeted profitable growth, which includes increasing revenue and market share through price and volume increases, development activities for new facilities, strategic acquisitions of complementary businesses, and improving operating margins. They also emphasize enhancing stockholder value through efficient cash utilization, including share repurchases and dividends.

Key risks include the impact of general economic conditions on waste volumes, competition within the highly fragmented waste industry, fluctuations in fuel and petrochemical costs, potential increases in regulatory compliance costs (especially related to environmental regulations and greenhouse gas emissions), and the ability to obtain and maintain necessary permits for landfill operations and expansions. Indebtedness levels and potential impacts on credit ratings are also noted as risks.

Following the significant Allied acquisition, Republic Services has been focused on debt reduction and has refinanced a substantial portion of its debt to lower average coupon rates and extend maturities. The company aims to maintain investment-grade credit ratings and manages its cash utilization strategy to support internal growth, acquisitions, share repurchases, dividends, and a strong capital structure, including managing debt levels.