Financial Data and Key Metrics Changes - In 2025, the company achieved revenue growth of 3.5% and adjusted EBITDA growth of nearly 7% [8] - Adjusted earnings per share reached $7.02, with adjusted free cash flow of $2.43 billion, reflecting a 200 basis points increase in adjusted free cash flow conversion to 45.8% [8][24] - The adjusted EBITDA margin expanded by 90 basis points to 32% for the full year [23] Business Line Data and Key Metrics Changes - Organic revenue in the Environmental Solutions business decreased total revenue by 2% in the fourth quarter, primarily due to a non-recurring emergency response project in 2024 [9][23] - Core price on total revenue was 5.8% in the fourth quarter, with core price on related revenue at 7.1% [19] - Volume declines were concentrated in construction and manufacturing end markets, leading to a 1% reduction in total revenue [9][20] Market Data and Key Metrics Changes - Commodity prices for recycling were $112 per ton in the fourth quarter, down from $153 per ton in the prior year [21] - The company expects average yield on related revenue in 2026 to be in the range of 4%-4.5% [19] - The overall macroeconomic environment is characterized as stable, with specific weaknesses in manufacturing and construction impacting volume [49][50] Company Strategy and Development Direction - The company is focused on digital investments and sustainability initiatives, including the deployment of AI-enabled tools to enhance pricing and operational efficiency [10][12] - The acquisition pipeline remains strong, with plans to invest approximately $1 billion in value-creating acquisitions in 2026 [17] - The company aims to maintain a disciplined approach to pricing, prioritizing price over volume to ensure returns on work [58] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding early signs of economic recovery, particularly in the western U.S., but noted ongoing challenges in the construction sector [110] - The company anticipates another year of profitable growth in 2026, with revenue guidance in the range of $17.05 billion to $17.15 billion [16] - Management highlighted the importance of maintaining customer loyalty and delivering exceptional value as key components of their strategy [6][7] Other Important Information - The company reported a strong employee engagement score of 87 and a record low turnover rate in 2025 [15] - Total debt at the end of the year was $13.7 billion, with total liquidity of $2 billion [24] - The company expects net interest expense in 2026 to be in the range of $575 million to $585 million [24] Q&A Session Summary Question: Can you discuss the $400 million in acquisitions year to date? - Management confirmed the acquisition of a company called Hamm, which provides strong disposal infrastructure, and noted that the remaining $600 million in potential acquisitions is still under consideration [30][31] Question: What are the expectations for margins in 2026? - Management indicated that underlying business expansion is expected to contribute 60-70 basis points to margin growth, with some headwinds from commodity prices and acquisitions [35] Question: Can you provide an update on the Polymer Center performance? - Management expects about a $30 million revenue uplift from the Polymer Centers in 2026, with approximately $10 million of incremental EBITDA [42] Question: What is the outlook for organic growth in Environmental Solutions? - Management anticipates relatively flat growth for the Environmental Solutions business in 2026, with some challenges in the first half due to tough comparisons [54] Question: How is the company addressing the emergency response growth gap? - Management acknowledged challenges in winning event-based work and emphasized the need to adjust pricing strategies to align with market conditions [103] Question: What are the inflation expectations for 2026? - Management expects an inflationary environment of approximately 3.5% for 2026 [111]