Waste Management, Inc
) - a provider of comprehensive waste management services
reported a net income of $168 million or 36 cents per share in
the first quarter of 2013, compared with $171 million, or 37
cents per share in the year-ago quarter. Adjusted earnings per
share (EPS) stood at 40 cents in the quarter versus 38 cents in
the year-ago quarter. Adjusted earnings in the quarter missed the
Zacks Consensus Estimate of 41 cents.
Quarter in Detail
Revenues in the first quarter 2013 were up 1.2 % year over
year to $3,336 million. The quarterly sales were below the Zacks
Consensus Estimate of $3,363 million.
Internal revenue growth from volumes was negative 0.4% for the
quarter. Internal revenue growth from yield for collection and
disposal operations was 1.4% for the reported quarter.
Average recycling commodity prices were down 12% year over
year in the reported quarter.
Revenues from the company's Collection business dipped 0.9% to
$2.1 billion in the reported quarter. Landfill revenues escalated
2.1% to $628 million, Transfer revenues increased 0.7% to $300
million, Wheelabrator revenues inched down 0.9% to $205 million
and Recycling revenues increased 3.8% to $358 million.
Operating expenses increased by $43 million to $2,209 million
in the reported quarter, driven by higher operating costs within
operations, primarily labor, transfer and disposal costs.
SG&A expenses stood at $ 390 million, down 4.2% year over
year in the reported quarter.
Cash and cash equivalents increased to $307 million as of Mar 31,
2013 versus $189 million in the year ago period. Long-term debt
less current portion stood at $9045 million as of Mar 31, 2013
versus $9173 million as of Dec 31, 2012.
In the reported quarter, net cash provided by operating
activities was $577 million, free cash flow was $348 million and
capital expenditures were $266 million. For the reported quarter,
Waste Management returned $170 million in dividends to its
Waste Management expects 2013 adjusted EPS to be in the range of
$2.15 -$2.20. Free cash flow is projected between $1.1 billion
and $1.2 billion.
Moving ahead, Waste Management expects positive momentum in both
yields and cost in 2013. The company is taking adequate measures
to improve its yield in the coming year and at the same time
remains focused on controlling its costs. On the collection
front, Waste Management has implemented a new regulatory cost
recovery fee and made some modifications in its fuel surcharge.
Additionally, in the recycling operations, the company is
implementing new rebate structures to reflect lower commodity
However, Waste Management currently has a Zacks Rank #4
(Sell). Other stocks that look promising and are worth
considering now are
Alliance Data Systems Corporation
Green Dot Corporation
), each carrying a Zacks Rank #2 (Buy).
ALLIANCE DATA (ADS): Free Stock Analysis
FISERV INC (FISV): Free Stock Analysis Report
GREEN DOT CP-A (GDOT): Free Stock Analysis
WASTE MGMT-NEW (WM): Free Stock Analysis
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