Waste Connections (WCN) Q2 2025 Earnings Call July 24, 2025 08:30 AM ET Speaker0Good morning, everyone, and welcome to the Waste Connections Inc. Q two twenty twenty five earnings call. Participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. For question, you may press and then one on a touch tone telephone.To withdraw your questions, you may press and 2. Note, this event is being recorded. I'd now like to turn the floor over to Ron Millstead, P ...

Core Viewpoint - The ongoing strike by sanitation workers represented by Teamsters Local 25 against Republic Services has led to significant trash accumulation across North Shore and Greater Boston, with accusations of bad faith negotiations from the union's president [1][3][4]. Group 1: Strike Details - The strike has entered its eighth day, with Teamsters Local 25 President Thomas G. Mari stating that Republic Services has not engaged in good faith negotiations [3][4]. - Mari claims that Republic's assertion of daily negotiations is "blatantly false," indicating a lack of communication since the last meeting [4]. - Picket lines have been extended to cities like San Diego, Los Angeles, and Seattle in solidarity with the striking workers [5]. Group 2: Community Impact - Residents are advised to continue placing trash curbside, but delays are expected, with pickups likely occurring a day late due to various factors [3][7]. - Malden officials noted that delays are caused by newly assigned drivers, slow truck dispatch times due to picketing, and high temperatures affecting working conditions [7][8]. - Republic Services has informed communities of plans to bring in outside workers to assist with trash collection, although these efforts have faced challenges and will not include recycling [6][8]. Group 3: Union Demands - The union is urging Republic Services to resume negotiations and match the wage rates and health benefits provided by other unionized waste companies in the area [4][6]. - Mari emphasized that the union is not asking for more than what is offered by competitors like Capitol Waste and Star Waste [6].

Core Points - Arlington has transitioned to a new waste collection service provider, Waste Management, due to a strike by the previous provider, Republic Services [2][4] - The new contract is expected to save the town at least $10 million over its duration compared to the previous manual collection system [3] - The new waste collection system includes 65-gallon trash and recycling receptacles, which are designed for automatic pickup, improving efficiency and cleanliness [2][3] Summary by Sections Contract and Cost Efficiency - Arlington entered into a contract with Waste Management, which was deemed the most cost-efficient option for the town [2] - The expected savings from this contract are projected to be at least $10 million compared to the previous manual collection program [3] Implementation and Community Response - New 65-gallon trash and recycling receptacles were delivered to residents in June to facilitate the automatic pickup system [2] - Some residents have expressed dissatisfaction with the transition, describing it as a "trainwreck" due to issues related to the ongoing strike and delays in receiving new bins [4][6] Operational Guidelines - Residents are instructed to place their bins three feet away from the curb and from each other for effective pickup [3]

Economic Outlook - The probability of a U.S. recession in 2025 is decreasing from a peak of 60% to below 50% due to the Trump administration easing aggressive tariff policies, which has allowed the S&P 500 to recover from a correction in March [1] Company Analysis Walmart (WMT) - Walmart has historically thrived during recessions due to its essential grocery offerings and reputation for affordability, attracting budget-conscious customers [3] - Approximately two-thirds of Walmart's inventory is produced in the U.S., providing a buffer against global trade tensions [4] - Over the past year, Walmart has achieved a 47% return, significantly outperforming the S&P 500's 10% return, with analysts optimistic about steady growth in the coming months [4] HCA Healthcare (HCA) - HCA Healthcare is the largest non-governmental hospital chain in the U.S. and has shown resilience during economic downturns, particularly in critical care sectors [5] - The company reported a remarkable growth of +236.97% and aims for a 29% market share by 2030 [5] - Cantor Fitzgerald raised its price target for HCA from $405 to $444, indicating a potential 16% upside from the stock's previous closing price [6] Waste Management (WM) - Waste Management has experienced a +135.87% growth over the past five years, as demand for waste collection and recycling services remains stable during recessions [9] - The waste management industry is projected to grow at a compound annual growth rate (CAGR) of 5.4% by 2030, driven by advancements in recycling technologies and increasing environmental awareness [10] - Recent evaluations by JPMorgan indicate optimism regarding WM's growth prospects, with a valuation of approximately 16x forward-year EV/EBITDA and a free cash flow yield of 3% [11]

Group 1: Mastercard - Mastercard has delivered significant returns, more than doubling investors' money in five years and generating 6x returns in ten years [4] - The company processed transactions worth $9.8 trillion in 2024 and has 1.1 billion cards in circulation worldwide [5] - In Q1, Mastercard's revenue grew by 14% year over year, driven by cross-border volume growth of 15%, with an operating margin of 57.2% [7] - The company is innovating with technologies like artificial intelligence, positioning itself well in the shift from cash to digital payments [8] Group 2: Waste Management - Waste Management has generated nearly 50% in total returns over three years, 160% over five years, and 470% over ten years [9] - The company expanded its business by acquiring Stericycle, expecting $250 million in synergies through 2027, which is double its original expectations [11] - Waste Management is focusing on scaling its core operations through acquisitions and has a robust pipeline of opportunities [12] - The company has increased its dividend for 22 consecutive years, demonstrating a commitment to shareholder returns [13] Group 3: BYD - BYD has surpassed Tesla in sales volumes and revenue, becoming the world's largest EV maker with over $100 billion in revenue in 2024 [15] - The company's net income jumped 100% year over year in Q1, indicating strong financial performance [15] - BYD is one of the largest battery manufacturers globally, providing a competitive advantage in costs and supply [17] - The company is expanding rapidly, entering new markets and opening showrooms, which positions it for continued growth [17][18]