Revenue and Income - Total revenues increased by $155.5 million, or 7.5%, to $2.228 billion for the three months ended March 31, 2025, compared to $2.073 billion for the same period in 2024[152]. - Acquisitions closed during or subsequent to the three months ended March 31, 2024, contributed an additional $131.0 million to revenues for the three months ended March 31, 2025[153]. - Operating income for the three months ended March 31, 2025, was $390.2 million, representing 17.5% of revenues, compared to $366.8 million, or 17.7% of revenues, for the same period in 2024[152]. - Net income attributable to Waste Connections was $241.5 million, or 10.9% of revenues, for the three months ended March 31, 2025, compared to $230.1 million, or 11.1% of revenues, for the same period in 2024[152]. - Total revenue for the three months ended March 31, 2025, was $2,228.2 million, an increase from $2,072.7 million in the same period of 2024[189]. - Adjusted net income attributable to Waste Connections for Q1 2025 was $293,120, up 9.1% from $268,669 in Q1 2024[250]. - Reported net income attributable to Waste Connections for Q1 2025 was $241,510, compared to $230,054 in Q1 2024, reflecting a growth of 5%[250]. Expenses and Costs - Cost of operations rose by $69.7 million, or 5.7%, to $1.291 billion for the three months ended March 31, 2025, from $1.222 billion for the same period in 2024[161]. - SG&A expenses increased by $29.4 million, or 13.3%, to $250.1 million for the three months ended March 31, 2025, from $220.7 million for the same period in 2024[164]. - Depreciation expense increased by $19.6 million, or 8.8%, to $242.3 million for the three months ended March 31, 2025, compared to $222.7 million for the same period in 2024[167]. - Amortization of intangibles expense rose by $7.3 million, or 18.2%, to $47.6 million for the three months ended March 31, 2025, from $40.3 million in the prior year[171]. - Interest expense increased by $2.4 million, or 3.0%, to $80.9 million for the three months ended March 31, 2025, from $78.5 million in the prior year[178]. - Segment expenses rose by $16.9 million to $326.1 million for the three months ended March 31, 2025, from $309.2 million in the prior year, due to increased labor and acquisition-related costs[202]. EBITDA and Margins - Operating income increased by $23.4 million, or 6.4%, to $390.2 million for the three months ended March 31, 2025, compared to $366.8 million for the same period in 2024[175]. - EBITDA decreased by $0.8 million to $112.3 million, resulting in a 25.6% EBITDA margin for the three months ended March 31, 2025, down from a 26.8% margin in the prior year[203]. - Adjusted EBITDA for Q1 2025 was $712,213, an increase of 9.5% from $650,673 in Q1 2024[248]. - Segment EBITDA for the Southern segment increased to $148.7 million, with a margin of 32.8% for the three months ended March 31, 2025, compared to $128.4 million and a margin of 30.7% in 2024[198]. - EBITDA for the Eastern segment increased by $8.1 million to $103.1 million, with a 25.6% EBITDA margin for the three months ended March 31, 2025, compared to 26.4% in the prior year[206]. - EBITDA for the Canada segment increased by $14.2 million to $135.6 million, achieving a 44.8% EBITDA margin for the three months ended March 31, 2025, up from 43.3% in the prior year[214]. Cash Flow and Capital Expenditures - Net cash provided by operating activities increased by $51.2 million to $541.5 million for the three months ended March 31, 2025, compared to $490.3 million in the prior year[221]. - Net cash used in investing activities decreased by $731.4 million to $603.2 million for the three months ended March 31, 2025, from $1.335 billion in the prior year[225]. - Capital expenditures for property and equipment totaled $212.5 million during the three months ended March 31, 2025, with total expected capital expenditures for 2025 projected between $1.200 billion and $1.225 billion[231]. - Adjusted free cash flow for the three months ended March 31, 2025, was $332.1 million, compared to $324.8 million for the same period in 2024, indicating a slight increase in liquidity[245]. Debt and Financing - The company had $2.480 billion outstanding under the revolving credit facility as of March 31, 2025, with a maturity date of February 27, 2029[232]. - The total long-term debt recorded was $8.465 billion, with significant principal payments due in the coming years, including $500 million due in 2028 and $500 million due in 2029[235]. - The company recorded $90.2 million in contingent consideration liabilities as of March 31, 2025[238]. - The company has $1.680 billion in unhedged floating rate debt as of March 31, 2025, with a one percentage point increase in interest rates potentially decreasing annual pre-tax income by $16.8 million[260]. - The company has four interest rate swap agreements to manage interest rate risks, effectively fixing rates on $800 million of variable rate debt[257]. Market and Operational Factors - During the three months ended March 31, 2025, the company recognized volume losses totaling $65.9 million due to a decrease in roll-off volumes and lower residential collection volumes[155]. - The average Canadian dollar to U.S. dollar exchange rate decreased, resulting in a revenue decrease of $16.8 million for the three months ended March 31, 2025[158]. - A $0.10 per gallon increase in diesel fuel prices would decrease pre-tax income by approximately $3.7 million during the remaining nine months of 2025[263]. - A 10% decrease in average recycled commodity prices would impact revenues by $5.9 million for Q1 2025[264]. - A $0.01 change in the CAD to USD exchange rate would affect annual revenue and EBITDA by approximately $19.0 million and $9.0 million, respectively[265]. - Inflationary pressures from higher fuel, materials, and labor costs are being managed through contracts that allow passing costs to customers[252]. Environmental and Social Governance (ESG) - The company committed $500 million to advance long-term ESG targets, focusing on reducing environmental impact and enhancing employee safety and engagement[143].

Core Viewpoint - Waste Connections reported quarterly earnings of $1.13 per share, exceeding the Zacks Consensus Estimate of $1.07 per share, and showing an increase from $1.04 per share a year ago, indicating a 5.61% earnings surprise [1][2] Financial Performance - The company achieved revenues of $2.23 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.42%, and up from $2.07 billion year-over-year [2] - Over the last four quarters, Waste Connections has exceeded consensus EPS estimates three times and topped revenue estimates four times [2] Stock Performance - Waste Connections shares have increased approximately 15.3% since the beginning of the year, contrasting with a -10.1% decline in the S&P 500 [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.34 on revenues of $2.41 billion, and for the current fiscal year, it is $5.26 on revenues of $9.52 billion [7] - The estimate revisions trend for Waste Connections is mixed, which may change following the recent earnings report [6] Industry Context - The Waste Removal Services industry, to which Waste Connections belongs, is currently ranked in the bottom 23% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Financial Performance - Revenue for Q1 2025 was $2.228 billion, a 7.5% increase from $2.073 billion in Q1 2024[5] - Net income for Q1 2025 was $241.5 million, or $0.93 per diluted share, compared to $230.1 million, or $0.89 per diluted share in the prior year[5] - Adjusted EBITDA for Q1 2025 was $712.2 million, up 9.5% year over year from $650.7 million[6] - Adjusted EBITDA margin improved to 32.0%, an increase of 60 basis points compared to the previous year[6] - Net income for the three months ended March 31, 2025, was $241,510, an increase from $230,054 in the same period of 2024, representing a growth of 5.3%[30] - Total revenue for the three months ended March 31, 2025, was $2,228,176, up from $2,072,653 in 2024, reflecting an increase of 7.5%[19] - Adjusted EBITDA for the three months ended March 31, 2025, was $712,213, compared to $650,673 in 2024, marking a growth of 9.5%[22] - The diluted earnings per share attributable to Waste Connections increased to $1.13 for the three months ended March 31, 2025, from $1.04 in 2024, reflecting an increase of 8.7%[30] Cash Flow and Financial Position - Net cash provided by operating activities was $541.5 million, with adjusted free cash flow of $332.1 million[6] - Cash flows from operating activities increased to $541,539 for the three months ended March 31, 2025, from $490,309 in 2024, a rise of 10.4%[27] - The company reported adjusted free cash flow of $332,075 for the three months ended March 31, 2025, slightly up from $324,793 in 2024, an increase of 2.4%[27] - Cash interest paid increased to $84,154 for the three months ended March 31, 2025, compared to $66,384 in 2024, an increase of 26.8%[20] - Debt to book capitalization at March 31, 2025, was reported at 51%, indicating a stable leverage position[21] Growth and Acquisitions - Year-to-date acquired annualized revenue reached over $125 million, including a new recycling facility in New Jersey[4] - The company plans to continue above-average acquisition activity in 2025, supported by strong financial position and free cash flow generation[4] - The contribution from acquisitions for the three months ended March 31, 2025, was $129,298, up from $77,988 in 2024, indicating a significant increase of 65.8%[19] Operational Performance - Employee retention improved for the tenth consecutive quarter, alongside record safety performance[4] - Solid waste internal growth for the three months ended March 31, 2025, was 2.2%, driven by a core price increase of 6.9%[17] - The company achieved a core solid waste pricing increase of 6.9%[3] Future Outlook - Waste Connections will provide its Q2 2025 outlook for revenue and adjusted EBITDA in a Form 8-K filing on April 24, 2025[9]

Core Insights - Waste Connections reported strong financial results for Q1 2025, driven by price-led organic solid waste growth and continued acquisition activity, resulting in a revenue of $2.228 billion, a 7.5% increase year-over-year [3][9] - The company achieved an adjusted EBITDA margin of 32.0%, reflecting a 60 basis point improvement compared to the previous year, and adjusted net income increased to $293.1 million, or $1.13 per diluted share [4][9] - The company continues to focus on acquisitions, with annualized revenues from acquisitions exceeding $125 million, including a new recycling facility in New Jersey [2][9] Financial Performance - Revenue for Q1 2025 was $2.228 billion, up from $2.073 billion in Q1 2024 [3] - Operating income increased to $390.2 million from $366.8 million year-over-year, with net income rising to $241.5 million, or $0.93 per diluted share [3][4] - Adjusted EBITDA for the quarter was $712.2 million, compared to $650.7 million in the prior year [4][9] Operational Highlights - Core solid waste pricing increased by 6.9%, despite facing volume weakness due to adverse weather conditions [2][15] - Employee retention improved for the tenth consecutive quarter, and the company achieved record safety performance during the period [2] - The company reported net cash provided by operating activities of $541.5 million and adjusted free cash flow of $332.1 million [9][23] Acquisition Strategy - Waste Connections has maintained a robust acquisition strategy, with over $125 million in annualized revenue from acquisitions completed to date [2][9] - The company continues to leverage its strong financial position and free cash flow generation to pursue above-average acquisition activity in 2025 [2] Market Position - Waste Connections serves approximately nine million customers across 46 states in the U.S. and six provinces in Canada, focusing on non-hazardous waste services and resource recovery [7] - The company emphasizes its Environmental, Social, and Governance (ESG) initiatives as integral to its long-term value creation strategy [7]

Core Viewpoint - Waste Connections (WCN) is expected to report quarterly earnings of $1.07 per share, reflecting a 2.9% increase year-over-year, with revenues projected at $2.22 billion, indicating a 7.1% year-over-year growth [1]. Earnings Estimates - Over the last 30 days, the consensus EPS estimate has been revised downward by 0.4%, indicating a collective reassessment by analysts [2]. - Changes in earnings estimates are crucial for predicting investor reactions, as empirical research shows a strong correlation between earnings estimate trends and short-term stock performance [3]. Revenue Projections - Analysts project 'Revenue Breakdown- E&P Waste Treatment, Recovery and Disposal' at $119.94 million, a significant increase of 131.7% year-over-year [5]. - The estimated 'Revenue Breakdown- Intermodal and Other' is $54.46 million, reflecting a 42.5% year-over-year increase [5]. - 'Revenues- E&P' are expected to reach $116.93 million, marking a 20% increase from the previous year [5]. - The consensus for 'Revenues- Intermodal and Other' stands at $55.14 million, indicating an 11.3% year-over-year change [6]. - 'Revenues- Total collection' is projected at $1.60 billion, showing a 5.8% increase from the prior year [6]. - 'Revenues- Recycling' is expected to decline to $46.25 million, reflecting a year-over-year decrease of 5.7% [6]. Geographic Revenue Insights - 'Geographic Revenues- Canada' are projected to reach $330.45 million, indicating a 17.9% year-over-year increase [7]. - 'Geographic Revenues- Southern' are expected at $457.70 million, reflecting a 9.3% increase [7]. - 'Geographic Revenues- Central' is forecasted to be $395.83 million, marking a 9.7% year-over-year change [7]. - 'Geographic Revenues- Eastern' are projected at $405.97 million, indicating a 12.8% increase [8]. - 'Geographic Revenues- Western' are expected to reach $454.36 million, reflecting a 7.6% increase [8]. Segment Performance - Analysts estimate 'Segment EBITDA- Western' to reach $126.49 million, compared to $113.05 million reported in the same quarter last year [8]. Stock Performance - Shares of Waste Connections have shown a return of 3.1% over the past month, contrasting with the Zacks S&P 500 composite's decline of 6.3% [9].

Company Overview - Waste Connections (WCN) shares increased by 5.3% to close at $192.90, contrasting with a 0.5% loss over the past four weeks, driven by price-led organic solid waste growth, improving commodities, and ongoing acquisition activities [1] - The company is expected to report quarterly earnings of $1.07 per share, reflecting a year-over-year increase of 2.9%, with revenues projected at $2.22 billion, up 7.3% from the previous year [2] Earnings Estimates and Trends - The consensus EPS estimate for Waste Connections has been revised marginally lower over the last 30 days, indicating a negative trend in earnings estimate revisions, which typically does not lead to price appreciation [3] - The stock currently holds a Zacks Rank of 3 (Hold), suggesting a neutral outlook [3] Industry Comparison - Waste Connections is part of the Zacks Waste Removal Services industry, where Montrose Environmental (MEG) experienced an 18.5% increase in its stock price, closing at $12.73, despite a -38.9% return over the past month [3] - Montrose Environmental's consensus EPS estimate has changed significantly to -$0.12, representing a -175% change from the previous year, and it currently holds a Zacks Rank of 5 (Strong Sell) [4]

Group 1: Company Performance - Waste Connections, Inc. (WCN) stock has increased by 9.6% over the past year, outperforming the industry's 2.5% rise and the Zacks S&P 500 composite's slight decline [1] - In the fourth quarter of 2024, WCN reported adjusted earnings of $1.16 per share, which missed the Zacks Consensus Estimate by 3.3% but represented a 4.5% year-over-year increase [1] - Revenues for the same quarter were $2.3 billion, slightly exceeding consensus estimates and growing by 11% compared to the previous year [1] Group 2: Operational Strategy - The company operates on a decentralized basis, allowing decision-making to be close to customers, which helps in addressing customer needs effectively [2] - This operational structure enables WCN to expand into nearby markets and serve smaller communities that may not be attractive to larger competitors [2] Group 3: Acquisition Strategy - Waste Connections evaluates acquisition opportunities based on financial, market, and management criteria, using initial buyouts as operational bases to strengthen their presence [3] - In recent years, WCN completed 24 acquisitions in 2024, 13 in 2023, 24 in 2022, and 30 in 2021, contributing significantly to its revenue [4] - The revenue contributions from acquisitions were $529 million in 2024, $410.9 million in 2023, $552 million in 2022, and $215.39 million in 2021 [4] Group 4: Shareholder Returns - Waste Connections has consistently rewarded shareholders with dividends, paying out $302.3 million in 2024, $270.6 million in 2023, $243 million in 2022, and $220.2 million in 2021 [5] - These dividend payments reflect the company's commitment to creating shareholder value and confidence in its business model [5] Group 5: Industry Challenges - The company faces challenges from stringent environmental, health, and safety regulations that increase operational costs [6] - Low entry barriers in the regulated waste collection and disposal business allow competitors to gain market share through aggressive pricing strategies, impacting WCN's profitability [7] - WCN's current ratio at the end of Q4 2024 was 0.65, below the industry average of 0.89, indicating potential issues with short-term debt coverage [8]

Core Viewpoint - Waste Connections, Inc. is set to report its financial results for Q1 2025 on April 23, 2025, with an investor conference call scheduled for April 24, 2025, at 8:30 A.M. Eastern Time [1]. Company Overview - Waste Connections is an integrated solid waste services company providing non-hazardous waste collection, transfer, and disposal services, including resource recovery primarily through recycling and renewable fuels generation [2]. - The company serves approximately nine million residential, commercial, and industrial customers across 46 states in the U.S. and six provinces in Canada [2]. - Waste Connections also offers non-hazardous oilfield waste treatment, recovery, and disposal services in various basins in the U.S. and Canada, along with intermodal services for cargo and solid waste containers in the Pacific Northwest [2]. Environmental, Social, and Governance (ESG) Efforts - The company considers its ESG initiatives as integral to its business strategy, focusing on long-term value creation, reducing emissions, increasing resource recovery, and enhancing employee engagement [2].

Core Insights - Waste Connections, Inc. (WCN) reported mixed fourth-quarter 2024 results, with earnings missing estimates while revenues exceeded expectations [1][2] Financial Performance - Adjusted earnings per share were $1.16, missing the Zacks Consensus Estimate by 3.3%, but increased 4.5% year-over-year [2] - Revenues reached $2.3 billion, slightly beating consensus estimates and growing 11% from the previous year [2] - Adjusted EBITDA was $656 million, down 10.4% year-over-year, with an adjusted EBITDA margin of 32.4%, a decrease of 20 basis points from the prior year [6] Segment Performance - Solid Waste Collection segment revenues grew 7.4% year-over-year to $1.6 billion, meeting estimates [4] - Solid Waste Disposal and Transfer segment revenues increased 6.9% to $718.5 million, surpassing expectations [4] - Solid Waste Recycling segment revenues surged 44.7% to $63.3 million, exceeding estimates [5] - E&P Waste Treatment, Recovery and Disposal segment revenues more than doubled to $146.3 million, significantly surpassing projections [5] - Intermodal and Other segment revenues declined 6.4% to $45.9 million, missing estimates [5] Balance Sheet & Cash Flow - Cash and cash equivalents at the end of Q4 2024 were $62.4 million, down from $78.4 million in the previous quarter [7] - Long-term debt remained stable at $6.7 billion [7] - Generated $568.9 million in cash from operating activities, with adjusted free cash flow of $173.8 million [7] - Capital expenditures totaled $396.7 million, and dividends paid amounted to $81 million [7] 2025 Outlook - For 2025, Waste Connections expects revenues between $9.45 billion and $9.6 billion, with a midpoint of $9.52 billion aligning with consensus estimates [8] - The company anticipates adjusted EBITDA of $3.12 billion to $3.2 billion, with an EBITDA margin projected at 33-33.3% [8]

Financial Data and Key Metrics Changes - Q4 2024 revenue reached $2.26 billion, an increase of $225 million or 11% year-over-year, bringing full year 2024 revenues to $8.92 billion, also up 11.2% year-over-year [23] - Adjusted EBITDA for Q4 was $732 million, up 11.6% year-over-year, representing 32.4% of revenue, while full year 2024 adjusted EBITDA was $2.902 billion, up 15% year-over-year with a margin increase of 100 basis points to 32.5% [27][28] - Adjusted free cash flow for 2024 was $1.218 billion, converting over 50% of adjusted EBITDA to free cash flow [15][31] Business Line Data and Key Metrics Changes - Solid waste core pricing in Q4 was 6.7%, with a range from about 5% in the Western region to about 7% in competitive markets [24] - Solid waste volumes in Q4 were down 2.7%, excluding a 50 basis point negative volume impact from Chiquita Canyon landfill [24] - Adjusted EBITDA margin was over 33% when excluding the reduction in tonnes at Chiquita and the drop-off in commodity-driven revenues [27] Market Data and Key Metrics Changes - The company closed approximately $750 million in annualized revenue from 24 acquisitions in 2024, contributing about $169 million of revenue in Q4 [19][23] - The company expects acquisition revenue contribution of about 3.5% in 2025, with a robust pipeline already having over $75 million in annualized revenue either closed or signed [20][35] Company Strategy and Development Direction - The company is focused on delivering excellence with humility, aiming for revenue growth to $10 billion and more while investing in innovation and sustainability [43] - The company is introducing electric trucks and expanding renewable natural gas generation in landfills, along with digitizing employee and customer experiences [43][44] - The disciplined approach to acquisitions remains unchanged, focusing on market selection and integration to provide value creation [20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the economic environment improving, which could positively impact volume growth in 2026 [66] - The company anticipates revenue in 2025 to be in the range of $9.45 billion to $9.6 billion, with adjusted EBITDA expected between $3.12 billion and $3.2 billion [35][36] - Management highlighted the importance of maintaining a balance between price and volume, with a conscious trade-off strategy in place [62] Other Important Information - The company closed the Chiquita Canyon landfill due to economic infeasibility, redirecting waste throughput to other landfills [16] - The company expects total 2024 outlays related to the Chiquita Canyon ETLF event to step down significantly in subsequent years [30] Q&A Session Summary Question: Can you clarify cash flow and green CapEx spending? - Management confirmed that green CapEx spending will increase to about $125 million in 2025, with expectations to be completed by 2026 [50][51] Question: What is the outlook for volume growth? - Management indicated that volume growth may remain down in 2025, with a focus on shedding unprofitable contracts and redeploying capital into more profitable ones [58][62] Question: How is employee retention in acquired businesses? - Management noted that employee turnover is significantly higher in acquired companies, often around 30% to 35% in the first year, but overall voluntary turnover is under 13% [71][72] Question: What is the margin outlook for 2025? - Management expects a margin expansion of 50 to 80 basis points, driven by the strength of the underlying business despite commodity and FX headwinds [76] Question: How does the company view M&A opportunities? - Management remains optimistic about M&A opportunities, with a full pipeline and expectations for above-average activity in 2025 [109]