01—Abstract
Summary
Summary of the 10-K filed February 23, 2023. Cited figures are marked; the original filing is the authoritative source.
Republic Services, Inc. reported strong performance in its 2022 10-K filing, demonstrating robust revenue growth driven by a combination of volume increases, strategic pricing, and key acquisitions, most notably US Ecology.
The company's commitment to operational efficiency, safety, and its 'Republic Way' operating model underpins its consistent financial results. Investments in technology and sustainability initiatives, such as fleet electrification and the development of a Polymer Center for plastics recycling, highlight Republic's forward-looking strategy to enhance customer value and environmental stewardship. Financially, Republic Services continues to focus on profitable growth, supported by a balanced capital allocation strategy that includes dividends and share repurchases.
The company's strong market position in the environmental services sector, coupled with a clear strategy for both organic and acquisition-driven growth, positions it well for continued success. Investors can look to Republic's ongoing commitment to shareholder returns and its strategic investments in sustainable practices as key drivers for future value.
02—Key points
Key Highlights
- Republic Services reported a 19.6% increase in revenue for 2022, reaching $13.5 billion, driven by volume growth (2.4%), average yield increases (5.2%), and strategic acquisitions (9.6%).
- The acquisition of US Ecology for $2.2 billion in May 2022 significantly expanded the company's environmental solutions segment, contributing to overall revenue growth.
- The company achieved an adjusted diluted EPS of $4.93 in 2022, an increase from $4.17 in 2021, reflecting strong operational performance and effective cost management.
- Republic Services continued its commitment to shareholder returns, increasing its quarterly dividend by approximately 8% and maintaining a $2.0 billion share repurchase authorization.
- Strategic investments in sustainability include the development of the first Polymer Center to advance plastics circularity and pilots for electric-powered collection trucks.
- The company maintains a strong safety record, reporting performance 35% better than the industry average over the past 10 years.
- Republic Services anticipates 2023 revenue to be in the range of $14.65 billion to $14.80 billion, with projected volume growth of 0.5% to 1.0% and an average yield increase of approximately 5.5%.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2022, Republic Services, Inc. kept $0.11.
- Revenue$13.51B100.0%
- Cost of revenue−$8.21B60.7%
- Gross profit$5.31B39.3%
- Operating costs−$2.91B21.6%
- Operating income$2.39B17.7%
- Interest, other & tax−$904.0M6.7%
- Net income$1.49B11.0%
Where FY2022 revenue went
$13.51B- Cost of revenue: $8.21B, 61% of revenue
- Net income: $1.49B, 11% of revenue
- SG&A: $1.45B, 11% of revenue
- Other operating costs: $1.46B, 11% of revenue
- Interest, other & tax: $904.0M, 6.7% of revenue
Kept 11% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2022filed February 23, 2023Financial Statements
FY2022 against FY2021
| Line item | FY2022FY2021 | Change |
|---|---|---|
| Revenue | $13.51B$11.29B | +19.6% |
| Cost of Revenue | $8.21B$6.74B | +21.8% |
| Gross Profit | $5.31B$4.56B | +16.4% |
| SG&A Expenses | $1.45B$1.20B | +21.6% |
| Operating Income | $2.39B$2.08B | +15.2% |
| Interest Expense | $395.60M$314.60M | +25.7% |
| Net Income | $1.49B$1.29B | +15.1% |
| EPS (Basic) | $4.70$4.05 | +16.0% |
| EPS (Diluted) | $4.69$4.04 | +16.1% |
| Shares Outstanding (Basic) | 316.53M318.81M | −0.7% |
| Shares Outstanding (Diluted) | 317.08M319.43M | −0.7% |
05—Questions
Frequently Asked Questions
What were the key drivers of Republic Services' revenue growth in 2022?
Republic Services' revenue grew by 19.6% to $13.5 billion in 2022. This growth was primarily driven by a 2.4% increase in volume, a 5.2% increase in average yield (pricing), and a significant 9.6% contribution from acquisitions, notably the acquisition of US Ecology.
How is Republic Services addressing environmental sustainability and its commitment to ESG principles?
Republic Services is investing in sustainability initiatives, including the development of a Polymer Center to enhance plastics circularity and piloting electric trucks to reduce fleet emissions. The company has also set ambitious 2030 sustainability goals, such as reducing greenhouse gas emissions by 35% and increasing the recovery of key materials by 40%.
What is the company's financial outlook for 2023?
For 2023, Republic Services anticipates revenue between $14.65 billion and $14.80 billion. This is expected to be driven by an estimated 0.5% to 1.0% volume growth and an average yield increase of approximately 5.5%. The company also expects adjusted diluted earnings per share to be in the range of $5.15 to $5.23.
How is Republic Services managing its debt and returning capital to shareholders?
The company has a balanced capital allocation strategy. As of December 31, 2022, Republic Services had approximately $11.9 billion in debt. They are committed to maintaining investment-grade credit ratings and are focused on generating free cash flow to fund operations, acquisitions, and shareholder returns through dividends and share repurchases. The company increased its quarterly dividend by approximately 8% and has a $2.0 billion share repurchase authorization.
06—Continue