2023-07-25 17:06:07 ET
- Waste Management press release ( NYSE: WM ): Q2 Non-GAAP EPS of $1.51 misses by $0.04 .
- Revenue of $5.12B (+1.8% Y/Y) misses by $110M .
- Core price for the second quarter of 2023 was 6.9% compared to 7.5% in the second quarter of 2022.
- Collection and disposal yield was 5.8% in the second quarter of 2023 compared to 6.2% in the second quarter of 2022.
- Total Company and collection and disposal volumes each increased 0.2% in the second quarter of 2023 compared to 1.6% and 2.3%, respectively, in the second quarter of 2022.
- Revised FY23 outlook:
- Total Company revenue growth is expected to be between 3.25% and 4.25%, which is lower than prior expectations by 100 basis points at the midpoint. This revision is largely related to the sustainability businesses where electricity and natural gas prices are lower than expected and recycled commodity prices are now expected to be lower during the second half of the year than initially planned. Further, revenue contributions from recycling acquisitions are evolving at a slower pace than expected.
- WM’s core price outlook remains strong at between 6.5% and 7.0%. Conversion of core price to yield is exceeding expectations and the Company now expects collection and disposal yield to exceed 5.5%. (d)
- The Company’s overall collection and disposal volume outlook is unchanged and expected to be flat to 2022, though stronger volume contributions are expected from the Company’s strategic accounts business while event-driven landfill volumes are developing slower than planned. (d)
- Adjusted operating EBITDA is expected to be between $5.775 and $5.875 billion in 2023, which is below prior expectations by $75 million, or about 1%, at the midpoint, with about half of the decline attributed to the sustainability businesses and the remainder due to lower event-driven volumes. (a)
- Pricing and cost optimization efforts remain on track to deliver targeted improvement in adjusted operating EBITDA margin of at least 40 basis points for the year. At the midpoint of the guidance range, adjusted operating EBITDA margin is expected to be 28.5%, an increase of 50 basis points compared to 2022. (a)
- The operating EBITDA contributions from the recycling and renewable energy businesses are expected to be between $115 and $135 million lower than 2022, which compares to the Company’s original outlook of a year-over-year decline of $70 to $100 million. (f)
- Free cash flow is projected to be between $1.675 and $1.775 billion, which is above prior expectations by $175 million at the midpoint.
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Waste Management Non-GAAP EPS of $1.51 misses by $0.04, revenue of $5.12B misses by $110M