Summary
Waste Management, Inc. (WM) reported strong revenue growth in 2017, driven by increased volumes in collection and disposal services and higher recycling commodity prices. The company's "Solid Waste" business remains its core, showing robust performance. WM also highlighted its commitment to shareholder returns, announcing a significant increase in its quarterly dividend for 2018, marking its 15th consecutive year of dividend increases. This reflects a healthy cash flow generation. Despite headwinds in the recycling market due to new Chinese regulations impacting commodity prices, the company is actively seeking alternative markets and improving recycling processes. Key financial highlights include a substantial increase in net income attributable to Waste Management, Inc. in 2017, partly due to a tax benefit from the Tax Cuts and Jobs Act. The company's strategic focus on "focused differentiation and continuous improvement" continues to drive operational efficiency and cost control. Management expressed confidence in continued earnings and cash flow growth for 2018.
Financial Highlights
54 data points| Revenue | $14.48B |
| Cost of Revenue | $9.02B |
| Gross Profit | $5.46B |
| SG&A Expenses | $1.47B |
| Operating Expenses | $11.85B |
| Operating Income | $2.64B |
| Net Income | $1.95B |
| EPS (Basic) | $4.44 |
| EPS (Diluted) | $4.41 |
| Shares Outstanding (Basic) | 438.80M |
| Shares Outstanding (Diluted) | 441.90M |
Key Highlights
- 1Revenue increased by 6.4% to $14.485 billion in 2017, primarily driven by volume growth, yield improvements in collection and disposal, and higher recycling commodity prices.
- 2Net income attributable to Waste Management, Inc. rose significantly to $1.949 billion in 2017, compared to $1.182 billion in 2016, boosted by operational performance and a tax benefit from the Tax Cuts and Jobs Act.
- 3The company announced a projected 9.4% increase in its quarterly dividend for 2018, continuing its 15-year streak of consecutive dividend increases, signaling strong cash flow.
- 4Operating expenses as a percentage of revenue remained stable at 62.3% in 2017, indicating effective cost management despite increased volumes and higher commodity costs.
- 5Free cash flow increased to $1.770 billion in 2017 from $1.710 billion in 2016, supporting capital expenditures, dividends, and share repurchases.
- 6Waste Management continues to invest in fleet modernization, with a significant number of natural gas vehicles, and is focused on improving operational efficiency and customer service.
- 7The company faced challenges in the recycling segment due to stricter import regulations in China, which affected commodity prices, but is actively managing these impacts and seeking new markets.