Summary
Waste Management Inc. (WM) reported its first quarter 2019 financial results, showcasing a revenue increase of 5.3% to $3.7 billion compared to the prior year period. This growth was primarily driven by higher volumes from favorable market conditions and strong landfill volume growth, coupled with an increased yield in its collection and disposal business. Despite these top-line improvements, net income attributable to Waste Management, Inc. saw a decrease to $347 million ($0.81 per diluted share) from $396 million ($0.91 per diluted share) in the first quarter of 2018. This decline was significantly impacted by a $52 million impairment charge related to an investment in a waste conversion technology business. Operationally, the company demonstrated robust cash flow generation, with net cash provided by operating activities increasing to $890 million from $809 million in the prior year. Free cash flow also saw a slight increase to $431 million. A significant strategic development announced after the quarter's end was the agreement to acquire Advanced Disposal Services, Inc. for an enterprise value of $4.9 billion, signaling a strong commitment to inorganic growth. However, the company also noted challenges, including lower market prices for recycling commodities and the absence of certain federal natural gas fuel credits that were present in the prior year, impacting operating results.
Financial Highlights
52 data points| Revenue | $3.70B |
| Cost of Revenue | $2.30B |
| Gross Profit | $1.40B |
| SG&A Expenses | $409.00M |
| Operating Expenses | $3.08B |
| Operating Income | $621.00M |
| Net Income | $347.00M |
| EPS (Basic) | $0.82 |
| EPS (Diluted) | $0.81 |
| Shares Outstanding (Basic) | 424.50M |
| Shares Outstanding (Diluted) | 426.90M |
Key Highlights
- 1Revenue increased by 5.3% to $3.7 billion, driven by higher volumes and improved yield in collection and disposal services.
- 2Net income decreased to $347 million ($0.81/share) from $396 million ($0.91/share) year-over-year, largely due to a $52 million impairment charge.
- 3Operating cash flow improved to $890 million, up from $809 million in the prior year.
- 4Free cash flow remained strong at $431 million.
- 5The company announced a significant agreement to acquire Advanced Disposal Services, Inc. for $4.9 billion, indicating a strategic focus on expansion.
- 6Recycling commodity prices continued to be a headwind, contributing to lower revenues in that segment.
- 7Operating expenses increased primarily due to higher volumes, cost inflation, and the absence of prior-year natural gas fuel credits.