Waste Connections Inc (WCN) Q3 2024 Earnings Call Highlights: Strong Revenue Growth and ...

GuruFocus News
3 min read

In This Article:

  • Revenue: $2.338 billion in Q3, up 13.3% year over year.

  • Adjusted EBITDA Margin: 33.7% in Q3, up 120 basis points year over year.

  • Core Pricing Growth: 6.8% in Q3.

  • Net Interest Expense: $80.2 million in Q3.

  • Adjusted Free Cash Flow: $1.44 billion year-to-date, on track for $1.2 billion for the full year.

  • Full Year Revenue Outlook: Approximately $8.9 billion.

  • Full Year Adjusted EBITDA Outlook: Approximately $2.91 billion.

  • Quarterly Cash Dividend Increase: 10.5% increase authorized by the Board of Directors.

  • Acquisition Contributions: Over $700 million in annualized private company revenue signed or closed to date in 2024.

Release Date: October 24, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Waste Connections Inc (NYSE:WCN) reported strong Q3 2024 results, with revenue of $2.338 billion, up 13.3% year over year, exceeding expectations.

  • The company achieved a 6.8% core pricing increase, contributing to solid waste growth and a sequential improvement in solid waste volumes.

  • Adjusted EBITDA margin improved to 33.7%, up 120 basis points year over year, driven by solid operational execution.

  • Employee retention improved for the eighth consecutive quarter, with voluntary turnover reduced by over 40% since 2022.

  • Waste Connections Inc (NYSE:WCN) completed a record year of private company acquisitions, with over $700 million in annualized revenue, positioning the company for future growth.

Negative Points

  • The company faced margin dilution from acquisitions and initial storm-related impacts at the end of the quarter.

  • Commodity values have dropped approximately 15% since the quarter end, with potential for further reduction in Q4.

  • Special waste activity, while improved sequentially, was still down year over year, highlighting the event-driven nature of these projects.

  • The company anticipates continued shedding of certain municipal contracts, impacting reported volumes.

  • There are uncertainties related to the upcoming election and potential changes in economic trends, which could impact future results.

Q & A Highlights

Q: Are you seeing any changes in customer activity related to the election, and was there any pull forward of special waste activity due to the election? A: Mary Anne Whitney, Executive Vice President and Chief Financial Officer, stated that the pull forward of special waste activity was not specifically related to the election. The projects referenced were expected to occur in Q4 but were completed in Q3, primarily on the West Coast.

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