Waste Management, In
) reported a net loss of $605 million or $1.29 per share in the
fourth quarter of 2013 versus a net income $224 million or 48
cents per share in the year-ago quarter. The results were
impacted mainly due to assets impairments and restructuring
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Adjusted earnings per share (EPS) stood at 56 cents in the
quarter versus 57 cents in the year-ago quarter. Adjusted
earnings in the quarter missed the Zacks Consensus Estimate of 60
For full year 2013, net income stood at $98 million or 21 cents
compared with $817 million or $1.76 in the year-ago period. The
results were impacted due to asset impairments and restructuring
Adjusted earnings per share stood at $2.15 for full-year 2013
versus $2.08 in the year-ago period. For 2013, adjusted earnings
missed the Zacks Consensus Estimate of $2.19.
Quarter in Detail
Revenues for fourth quarter of 2013 were $3,500 million versus
$3,434 million in the year-ago quarter. The quarterly sales were
below the Zacks Consensus Estimate of $3,584 million. The
increase in earnings was driven by internal revenue growth from
For full year 2013, the company reported revenues of $13,983
million versus $13,649 million in the year-ago period. The yearly
sales were below the Zacks Consensus Estimate of $14,067 million.
Internal revenue growth from volumes was a negative 2.2 % in the
quarter. Internal revenue growth from yield for collection and
disposal operations was 2.4% in the reported quarter.
Core price (including price increases and fees, other than the
company's fuel surcharge, net of rollbacks) was 4.0% in the
reported quarter versus 2.5% in the year-ago quarter.
Revenues from the company's Collection business edged up 1.2%
year over year to $2.1 billion in the reported quarter. Landfill
revenues escalated 2.3% year over year to $705 million, Recycling
revenues increased 7.9% to $356 million while Transfer revenues
decreased 0.9% year over year to $332 million and Wheelabrator
revenues edged down 1.8% to $211 million.
Operating expenses increased by $43 million to $2,267 million in
the reported quarter, driven by higher cost related to recently
acquired businesses and labor expense.
SG&A expenses stood at $376 million in the reported quarter
versus $356 million in the year-ago quarter.
Cash and cash equivalents stood at $58 million as of Dec 31, 2013
versus $194 million in the year-ago period. Long-term debt, less
current portion, stood at $9,500 million as of Dec 31, 2013
versus $9,173 million as of Dec 30, 2012.
Net cash provided by operating activities was $2,455 million and
free cash flow was $1,322 million as of Dec 31, 2013. Capital
expenditures were $1,271 million for full year 2013.
For full year, Waste Management returned $922 million to
shareholders, consisting of $683 million in dividends and $239
million in stock repurchases.
Waste Management announced its intention to increase the dividend
to $1.50 per share annually for approximately $700 million and
has also authorized up to $600 million of share
Waste Management expects 2014 adjusted earnings per share to be
in the range of $2.30-2.35. Internal revenue growth from yield on
the collection and disposal business is expected to be
approximately 2.0% and internal revenue growth from volume is
expected to be negative 1.0%. Free cash flow is projected to
exceed $1.3 billion, assuming $100 million in divestitures.
Capital expenditures are expected to be approximately $1.2 to
$1.3 billion. The recycling operations improvements are expected
to offset recycling commodity sales price decline and the
recycling business is expected to be flat in 2014. The company
expects to invest $100 and $250 million on tuck-in acquisitions
in its traditional waste operations. Going forward, the company
expects strong cash generation in 2014.
The market reacted positively as share price increased by 0.34 or
0.78% in pre-market trading.
However, Waste Management currently has a Zacks Rank #4 (Sell).
Other stocks that look promising and are worth considering are
Global Payments Inc.
), each carrying a Zacks Rank #2 (Buy).