What drove the increase in Waste Management's revenue in Q2 2017?

Revenue increased primarily due to higher volumes in collection and disposal services, improved pricing ('yield') across these lines of business, and significantly higher market prices for recycling commodities. Additionally, higher fuel surcharge revenues, linked to increased diesel prices, and revenues from recent acquisitions contributed to the growth.

How did Waste Management manage its expenses despite revenue growth?

While operating expenses increased by 7.5% to $2.29 billion, they remained relatively stable as a percentage of revenue (62.3% vs. 62.2% in the prior year). The increase was largely driven by higher costs related to increased volumes, higher recycling commodity costs, increased maintenance, and higher fuel prices. Selling, general, and administrative expenses also increased, mainly due to higher incentive compensation and other variable costs tied to revenue growth, but as a percentage of revenue, they slightly decreased.

What is the company's outlook on its financial health and shareholder returns?

The company demonstrated strong operational performance leading to increased income from operations and net income. It generated robust free cash flow of $520 million, which supports its ability to pay dividends and repurchase stock. Waste Management continues to return capital to shareholders and has substantial capacity for future repurchases, indicating confidence in its ongoing financial stability and ability to generate cash.

Are there any significant environmental or legal liabilities impacting the company?

The company disclosed ongoing legal proceedings related to environmental matters, including Superfund sites and potential civil penalties in Pennsylvania. However, management stated that they do not currently believe the eventual outcome of these matters, individually or in the aggregate, will have a material adverse effect on the Company's business, financial condition, results of operations or cash flows. Recorded liabilities for environmental remediation are in place, and the company actively manages these.

WM 10-Q Quarterly Report Q2 FY2017 — Revenue, Net Income, EPS

Summary

Waste Management, Inc. (WM) reported solid financial results for the quarter ending June 30, 2017. The company demonstrated revenue growth driven by increases in both volume and pricing across its collection and disposal services, alongside a significant contribution from higher recycling commodity prices. Operating income saw a healthy increase, reflecting effective cost management and operational efficiencies, despite rising fuel and commodity costs impacting operating expenses. Net income attributable to Waste Management, Inc. increased year-over-year, leading to improved earnings per diluted share. The company also maintained a strong free cash flow, enabling continued return of capital to shareholders through dividends and share repurchases, while also managing its debt levels prudently. WM's strategic focus on yield management and continuous improvement appears to be yielding positive financial outcomes.

Financial Highlights

51 data points

Beta

Revenue

$3.68B

0.4% Gross Margin

Net Income

$362.00M

0.1% Net Margin

EPS (Diluted)

$0.81

Total Assets

$20.84B

Cash & Equivalents

$32.00M

Free Cash Flow

$813.00M

Financial Statements

Beta

Revenue	$3.68B
Cost of Revenue	$2.29B
Gross Profit	$1.39B
SG&A Expenses	$353.00M
Operating Expenses	$3.00B
Operating Income	$673.00M
Net Income	$362.00M
EPS (Basic)	$0.82
EPS (Diluted)	$0.81
Shares Outstanding (Basic)	441.90M
Shares Outstanding (Diluted)	444.40M

Key Highlights

1Total operating revenues increased by 7.4% to $3.68 billion compared to the prior year period.
2Income from operations increased by 10.1% to $673 million.
3Net income attributable to Waste Management, Inc. rose to $362 million, or $0.81 per diluted share, up from $287 million, or $0.64 per diluted share, in the prior year.
4Free cash flow for the quarter was $520 million, an increase from $461 million in the prior year.
5The company repurchased approximately 2.7 million shares of common stock during the quarter, with an ongoing authorization for $500 million in future repurchases.
6Debt levels decreased, with total debt standing at $9.06 billion as of June 30, 2017, down from $9.31 billion at the end of 2016.

WASTE MANAGEMENT INC Quarterly Report for Q2 Ended Jun 30, 2017

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions