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
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).
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