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Sep 30, 2020
Waste Management Q3 2020 Earnings Report
Reported strong operating performance with over $1 billion in net cash from operating activities and a strong operating EBITDA margin.
Key Takeaways
Waste Management announced its Q3 2020 financial results, revealing a revenue decline in the collection and disposal business offset by yield growth, improved operating expenses, and a focus on cost management. The company reported strong operating EBITDA and net cash provided by operating activities, highlighting its resilience and strategic initiatives during the pandemic.
Revenue declined in the collection and disposal business due to volume declines, partially offset by yield growth.
Operating expenses improved due to proactive cost management and lower fuel prices.
Total Company operating EBITDA was $1.10 billion, or 28.5% of revenue.
Net cash provided by operating activities increased to $1.03 billion.
Waste Management
Waste Management
Forward Guidance
The company is well-positioned for a strong finish to the year with positive momentum heading into 2021, driven by customer service digitalization investments, contributions from the acquisition of Advanced Disposal, and progress in transforming the recycling business.
Positive Outlook
- Customer service digitalization investments are the right approach and have been accelerated to reap the benefits sooner.
- Further contributions are expected from the acquisition of Advanced Disposal.
- Progress is being made in transforming the recycling business.
- The company has learned to operate with a lower cost structure.
- The company is holding on to operating efficiencies and cost savings as volumes recover.
Challenges Ahead
- Increased competition
- Pricing actions
- Failure to implement optimization, growth, and cost savings initiatives and overall business strategy
- Failure to identify acquisition targets and negotiate attractive terms
- Failure to consummate or integrate acquisitions