Casella Q4 2019 Earnings Report
Key Takeaways
Casella Waste Systems reported a strong fourth quarter with revenues up 10.8% to $193.6 million and net income of $9.1 million. The company's solid waste pricing programs were ahead of budget, and they continued to execute against their key strategies.
Revenues increased by 10.8% compared to the same period in 2018, reaching $193.6 million.
Net income rose to $9.1 million, a $22.7 million increase from the same period in 2018.
Overall solid waste pricing increased by 5.0%, driven by collection and landfill pricing increases.
The company acquired nine businesses with approximately $53 million of annualized revenues during 2019.
Casella
Casella
Casella Revenue by Segment
Forward Guidance
The Company provided guidance for the fiscal year ending December 31, 2020, expecting revenue between $800 million and $815 million, net income between $35 million and $39 million, and Adjusted EBITDA between $170 million and $174 million.
Positive Outlook
- Revenue growth of between 7.6% and 9.6% is expected in fiscal year 2020.
- 4.7% revenue growth from the roll-over impact of acquisitions completed during fiscal year 2019 and those already completed in early 2020.
- Solid Waste business revenue growth of between 9.0% and 11.0%.
- Price growth from 3.5% to 4.5% in the Solid Waste business.
- Net cash provided by operating activities between $131 million and $135 million
Challenges Ahead
- Volume growth from (0.5)% to 0.5% in the Solid Waste business, including a headwind from the reduction of volumes at the North Country landfill.
- The planned reduction of volumes at the North Country landfill is expected to negatively impact revenues by $(5.0) million and operating income by $(4.5) million from fiscal year 2019.
- Capital expenditures of approximately $113 million, which includes approximately $16 million of non-recurring capital associated with acquisition integration, and $12 million of Waste USA landfill phase VI construction capital expenditures.
- Net cash provided by operating activities will be negatively impacted in 2020 as we plan to spend $14 million on landfill closure, site improvement and remediation expenditures associated with the Southbridge landfill closure.
- Does not include the impact of any acquisitions that have not yet been completed.
Revenue & Expenses
Visualization of income flow from segment revenue to net income