MORRISTOWN, N.J., Feb. 20,
2020 /PRNewswire/ -- Covanta Holding Corporation (NYSE: CVA)
("Covanta" or the "Company"), a world leader in sustainable waste
and energy solutions, reported financial results today for the year
ended December 31, 2019.
|
Year Ended
December 31,
|
|
2019
|
|
2018
|
|
|
|
|
|
(Unaudited, $ in
millions, except per share
amounts)
|
Revenue
|
$1,870
|
|
$1,868
|
Net income
|
$10
|
|
$152
|
Adjusted
EBITDA
|
$428
|
|
$457
|
Net cash provided by
operating activities
|
$226
|
|
$238
|
Free Cash
Flow
|
$140
|
|
$100
|
Reconciliations of
non-GAAP measures can be found in the exhibits to this press
release.
|
Key Highlights:
- Processed 21.4 million tons of waste at EfW facilities, a new
annual record for Covanta
- 2019 EfW tip fee prices grew 5% same store, including 11%
profiled waste revenue growth
- Reached construction stage on 3 development projects in the
UK
- Issued 5th Comprehensive Sustainability Report highlighting
continued progress towards our Environmental, Social and Governance
goals
"2019 finished on a positive note, as we saw continued strength
in waste pricing and improved processing volume on a year-over-year
basis. Our focus on a strong operating culture helped our fleet
break multiple processing records," said Stephen J. Jones, Covanta's President and CEO.
"At the same time, our development efforts continue to advance as
we progressed our third UK project to financial close. Looking
ahead to 2020, we continue to invest in our fleet to drive growth,
both domestically and overseas as we help the world meet its
growing need for sustainable waste solutions."
More detail on our fourth quarter results can be found in the
exhibits to this release and in our fourth quarter 2019 earnings
presentation found in the Investor Relations section of the Covanta
website at www.covanta.com.
2020 Guidance
The Company established 2020 guidance
for the following key metrics:
(In millions)
Metric
|
2019
Actual
|
2020
Guidance
Range
|
Adjusted
EBITDA
|
$428
|
$415 -
$445
|
Free Cash
Flow
|
$140
|
$100 -
$140
|
Reconciliations of
non-GAAP measures can be found in the exhibits to this press
release.
|
Guidance as of
February 20, 2020.
|
Conference Call Information
Covanta will host a
conference call at 8:30 AM (Eastern)
on Friday, February 21, 2020 to discuss its fourth quarter
results.
The conference call will begin with prepared remarks, which will
be followed by a question and answer session. To participate
on the live call, please dial 1-888-317-6003 (US) or 1-412-317-6061
(international) approximately 15 minutes prior to the scheduled
start of the call and enter the passcode 0233059. The conference
call will also be webcast live from the Investor Relations section
of the Company's website. A presentation will be made available
during the call and will be found in the Investor Relations section
of the Covanta website at www.covanta.com.
An archived webcast will be available two hours after the end of
the conference call and can be accessed through the Investor
Relations section of the Covanta website at www.covanta.com.
About Covanta
Covanta is a world leader in providing
sustainable waste and energy solutions. Annually, Covanta's
modern Energy-from-Waste ("EfW") facilities safely convert
approximately 21 million tons of waste from municipalities and
businesses into clean, renewable electricity to power one million
homes and recycle 500,000 tons of metal. Through a vast network of
treatment and recycling facilities, Covanta also provides
comprehensive industrial material management services to companies
seeking solutions to some of today's most complex environmental
challenges. For more information, visit www.covanta.com.
Cautionary Note Regarding Forward-Looking
Statements
Certain statements in this press release may
constitute "forward-looking" statements as defined in Section 27A
of the Securities Act of 1933, as amended (the "Securities Act"),
Section 21E of the Securities Exchange Act of 1934 (the "Exchange
Act"), the Private Securities Litigation Reform Act of 1995 (the
"PSLRA") or in releases made by the Securities and Exchange
Commission ("SEC"), all as may be amended from time to time. Such
forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the
actual results, performance or achievements of Covanta Holding
Corporation and its subsidiaries ("Covanta") or industry results,
to differ materially from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Statements that are not historical fact are
forward-looking statements. For additional information see
the Cautionary Note Regarding Forward-Looking Statements at the end
of the Exhibits.
Covanta Holding
Corporation
|
Exhibit 1
|
Consolidated
Statements of Operations
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
(In millions, except per share amounts)
|
OPERATING
REVENUE:
|
|
|
|
|
|
|
|
|
Waste and service
revenue
|
|
$
|
354
|
|
|
$
|
350
|
|
|
$
|
1,393
|
|
|
$
|
1,327
|
|
Energy
revenue
|
|
82
|
|
|
86
|
|
|
329
|
|
|
343
|
|
Recycled metals
revenue
|
|
25
|
|
|
23
|
|
|
86
|
|
|
95
|
|
Other operating
revenue
|
|
24
|
|
|
41
|
|
|
62
|
|
|
103
|
|
Total operating
revenue
|
|
485
|
|
|
500
|
|
|
1,870
|
|
|
1,868
|
|
OPERATING
EXPENSE:
|
|
|
|
|
|
|
|
|
Plant operating
expense
|
|
333
|
|
|
334
|
|
|
1,371
|
|
|
1,321
|
|
Other operating
expense, net
|
|
21
|
|
|
21
|
|
|
64
|
|
|
65
|
|
General and
administrative expense
|
|
32
|
|
|
30
|
|
|
122
|
|
|
115
|
|
Depreciation and
amortization expense
|
|
56
|
|
|
56
|
|
|
221
|
|
|
218
|
|
Impairment charges
(a)
|
|
(1)
|
|
|
—
|
|
|
2
|
|
|
86
|
|
Total operating
expense
|
|
441
|
|
|
441
|
|
|
1,780
|
|
|
1,805
|
|
Operating
income
|
|
44
|
|
|
59
|
|
|
90
|
|
|
63
|
|
OTHER (EXPENSE)
INCOME:
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(35)
|
|
|
(34)
|
|
|
(143)
|
|
|
(145)
|
|
Net gain on sale of
business and investments (a)
|
|
—
|
|
|
—
|
|
|
49
|
|
|
217
|
|
Loss on
extinguishment of debt (a)
|
|
—
|
|
|
(12)
|
|
|
—
|
|
|
(15)
|
|
Other income
(expense), net
|
|
—
|
|
|
(2)
|
|
|
1
|
|
|
(3)
|
|
Total other (expense)
income
|
|
(35)
|
|
|
(48)
|
|
|
(93)
|
|
|
54
|
|
Income (loss)
before income tax benefit and equity in net income
from unconsolidated
investments
|
|
9
|
|
|
11
|
|
|
(3)
|
|
|
117
|
|
Income Tax Benefit
(Expense)
|
|
1
|
|
|
(5)
|
|
|
7
|
|
|
29
|
|
Equity in net income
from unconsolidated investments
|
|
2
|
|
|
3
|
|
|
6
|
|
|
6
|
|
Net
income
|
|
$
|
12
|
|
|
$
|
9
|
|
|
$
|
10
|
|
|
$
|
152
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Common Shares Outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
131
|
|
|
130
|
|
|
131
|
|
|
130
|
|
Diluted
|
|
134
|
|
|
133
|
|
|
133
|
|
|
132
|
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.09
|
|
|
$
|
0.07
|
|
|
$
|
0.07
|
|
|
$
|
1.17
|
|
Diluted
|
|
$
|
0.09
|
|
|
$
|
0.07
|
|
|
$
|
0.07
|
|
|
$
|
1.15
|
|
|
|
|
|
|
|
|
|
|
Cash Dividend
Declared Per Share
|
|
$
|
0.25
|
|
|
$
|
0.25
|
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
(a) For additional
information, see Exhibit 4 of this Press Release.
|
Covanta Holding
Corporation
|
Exhibit 2
|
Consolidated
Balance Sheets
|
|
|
|
|
As
of
|
|
December
31,
|
|
2019
|
|
2018
|
|
|
|
|
|
(Unaudited)
|
|
|
ASSETS
|
(In millions, except per share amounts)
|
Current:
|
|
|
|
Cash and cash
equivalents
|
$
|
37
|
|
|
$
|
58
|
|
Restricted funds held
in trust
|
18
|
|
|
39
|
|
Receivables (less
allowances of $9 and $8, respectively)
|
240
|
|
|
338
|
|
Prepaid expenses and
other current assets
|
105
|
|
|
64
|
|
Total Current
Assets
|
400
|
|
|
499
|
|
Property, plant and
equipment, net
|
2,451
|
|
|
2,514
|
|
Restricted funds held
in trust
|
8
|
|
|
8
|
|
Intangible assets,
net
|
258
|
|
|
279
|
|
Goodwill
|
321
|
|
|
321
|
|
Other
assets
|
277
|
|
|
222
|
|
Total
Assets
|
$
|
3,715
|
|
|
$
|
3,843
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Current:
|
|
|
|
Current portion of
long-term debt
|
$
|
17
|
|
|
$
|
15
|
|
Current portion of
project debt
|
8
|
|
|
19
|
|
Accounts
payable
|
36
|
|
|
76
|
|
Accrued expenses and
other current liabilities
|
292
|
|
|
333
|
|
Total Current
Liabilities
|
353
|
|
|
443
|
|
Long-term
debt
|
2,366
|
|
|
2,327
|
|
Project
debt
|
125
|
|
|
133
|
|
Deferred income
taxes
|
372
|
|
|
378
|
|
Other
liabilities
|
123
|
|
|
75
|
|
Total
Liabilities
|
3,339
|
|
|
3,356
|
|
Equity:
|
|
|
|
Preferred stock
($0.10 par value; authorized 10 shares; none issued and
outstanding)
|
—
|
|
|
—
|
|
Common stock ($0.10
par value; authorized 250 shares; issued 136 shares,
outstanding 131 shares)
|
14
|
|
|
14
|
|
Additional paid-in
capital
|
857
|
|
|
841
|
|
Accumulated other
comprehensive loss
|
(35)
|
|
|
(33)
|
|
Accumulated
deficit
|
(460)
|
|
|
(334)
|
|
Treasury stock, at
par
|
—
|
|
|
(1)
|
|
Total
Equity
|
376
|
|
|
487
|
|
Total Liabilities
and Equity
|
$
|
3,715
|
|
|
$
|
3,843
|
|
Covanta Holding
Corporation
|
Exhibit 3
|
Consolidated
Statements of Cash Flow
|
|
|
|
|
Twelve Months
Ended
December 31,
|
|
2019
|
|
2018
|
|
|
|
|
|
(Unaudited, in
millions)
|
OPERATING
ACTIVITIES:
|
|
|
|
Net income
|
$
|
10
|
|
|
$
|
152
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization expense
|
221
|
|
|
218
|
|
Amortization of
deferred debt financing costs
|
5
|
|
|
5
|
|
Net gain on sale of
business and investments (a)
|
(49)
|
|
|
(217)
|
|
Impairment charges
(a)
|
2
|
|
|
86
|
|
Loss on
extinguishment of debt (a)
|
—
|
|
|
15
|
|
Provision for
doubtful accounts
|
2
|
|
|
2
|
|
Stock-based
compensation expense
|
25
|
|
|
24
|
|
Equity in net income
from unconsolidated investments
|
(6)
|
|
|
(6)
|
|
Deferred income
taxes
|
(9)
|
|
|
(31)
|
|
Dividends from
unconsolidated investments
|
9
|
|
|
13
|
|
Other, net
|
3
|
|
|
(10)
|
|
Change in working
capital, net of effects of acquisitions and dispositions
|
12
|
|
|
(12)
|
|
Changes in noncurrent
assets and liabilities, net
|
1
|
|
|
(1)
|
|
Net cash provided by
operating activities
|
226
|
|
|
238
|
|
INVESTING
ACTIVITIES:
|
|
|
|
Purchase of property,
plant and equipment
|
(158)
|
|
|
(206)
|
|
Acquisition of
businesses, net of cash acquired
|
2
|
|
|
(50)
|
|
Proceeds from the
sale of assets, net of restricted cash
|
27
|
|
|
128
|
|
Property insurance
proceeds
|
—
|
|
|
18
|
|
Payment of
indemnification claim related to sale of asset
|
—
|
|
|
(7)
|
|
Investment in equity
affiliate
|
(14)
|
|
|
(16)
|
|
Other, net
|
(2)
|
|
|
(6)
|
|
Net cash used in
investing activities
|
(145)
|
|
|
(139)
|
|
FINANCING
ACTIVITIES:
|
|
|
|
Proceeds from
borrowings on long-term debt
|
80
|
|
|
1,165
|
|
Proceeds from
borrowings on revolving credit facility
|
536
|
|
|
740
|
|
Proceeds from
insurance premium financing
|
29
|
|
|
25
|
|
Payments on long-term
debt
|
(16)
|
|
|
(944)
|
|
Payments on revolving
credit facility
|
(565)
|
|
|
(973)
|
|
Payments on project
debt
|
(18)
|
|
|
(23)
|
|
Payment of deferred
financing costs
|
(1)
|
|
|
(16)
|
|
Cash dividends paid
to stockholders
|
(133)
|
|
|
(134)
|
|
Payment of insurance
premium financing
|
(26)
|
|
|
(24)
|
|
Other, net
|
(8)
|
|
|
(5)
|
|
Net cash used in
financing activities
|
(122)
|
|
|
(189)
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
(1)
|
|
|
1
|
|
Net decrease in cash,
cash equivalents and restricted cash
|
(42)
|
|
|
(89)
|
|
Cash, cash
equivalents and restricted cash at beginning of period
|
105
|
|
|
194
|
|
Cash, cash
equivalents and restricted cash at end of period
|
$
|
63
|
|
|
$
|
105
|
|
|
|
|
|
(a) For additional
information, see Exhibit 4 of this Press Release.
|
Covanta Holding
Corporation
|
Exhibit 4
|
Consolidated
Reconciliation of Net Income and Net Cash Provided by Operating
Activities to
Adjusted EBITDA
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited, in millions)
|
Net
income
|
|
$
|
12
|
|
|
$
|
9
|
|
|
$
|
10
|
|
|
$
|
152
|
|
Depreciation and
amortization expense
|
|
56
|
|
|
56
|
|
|
221
|
|
|
218
|
|
Interest
expense
|
|
35
|
|
|
34
|
|
|
143
|
|
|
145
|
|
Income tax (benefit)
expense
|
|
(1)
|
|
|
5
|
|
|
(7)
|
|
|
(29)
|
|
Impairment charges
(a)
|
|
(1)
|
|
|
—
|
|
|
2
|
|
|
86
|
|
Net gain on sale of
businesses and investments (b)
|
|
—
|
|
|
—
|
|
|
(49)
|
|
|
(217)
|
|
Loss on
extinguishment of debt (c)
|
|
—
|
|
|
12
|
|
|
—
|
|
|
15
|
|
Property insurance
recoveries, net
|
|
—
|
|
|
(11)
|
|
|
—
|
|
|
(18)
|
|
Loss (gain) on asset
sales
|
|
1
|
|
|
(1)
|
|
|
4
|
|
|
1
|
|
Capital type
expenditures at client owned facilities (e)
|
|
6
|
|
|
9
|
|
|
34
|
|
|
37
|
|
Accretion
expense
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
Business development
and transaction costs
|
|
—
|
|
|
(1)
|
|
|
2
|
|
|
3
|
|
Severance and
reorganization costs (d)
|
|
2
|
|
|
—
|
|
|
13
|
|
|
5
|
|
Stock-based
compensation expense
|
|
5
|
|
|
6
|
|
|
25
|
|
|
24
|
|
Adjustments to
reflect Adjusted EBITDA from unconsolidated
investments
|
|
7
|
|
|
7
|
|
|
25
|
|
|
23
|
|
Other
(f)
|
|
3
|
|
|
7
|
|
|
3
|
|
|
10
|
|
Adjusted
EBITDA
|
|
$
|
125
|
|
|
$
|
132
|
|
|
$
|
428
|
|
|
$
|
457
|
|
Capital type
expenditures at client owned facilities (e)
|
|
(6)
|
|
|
(9)
|
|
|
(34)
|
|
|
(37)
|
|
Cash paid for
interest
|
|
(29)
|
|
|
(21)
|
|
|
(152)
|
|
|
(136)
|
|
Cash paid for taxes,
net
|
|
—
|
|
|
—
|
|
|
(5)
|
|
|
(2)
|
|
Equity in net income
from unconsolidated investments
|
|
(2)
|
|
|
(3)
|
|
|
(6)
|
|
|
(6)
|
|
Adjustments to
reflect Adjusted EBITDA from unconsolidated
investments
|
|
(7)
|
|
|
(7)
|
|
|
(25)
|
|
|
(23)
|
|
Dividends from
unconsolidated investments
|
|
4
|
|
|
12
|
|
|
9
|
|
|
13
|
|
Adjustment for
working capital and other
|
|
29
|
|
|
(13)
|
|
|
11
|
|
|
(28)
|
|
Net cash provided
by operating activities
|
|
$
|
114
|
|
|
$
|
91
|
|
|
$
|
226
|
|
|
$
|
238
|
|
|
(a)
|
During the year ended
December 31, 2018, we identified indicators
of impairment associated with certain of our EfW
facilities and recorded a non-cash impairment charge of
$86 million, to reduce the carrying value of the facilities to
their estimated fair value.
|
(b)
|
During the year ended
December 31, 2019, we recorded a $56 million gain related to the
Rookery South Energy Recovery Facility development project and a
$11 million loss related to the divestiture of our Springfield and
Pittsfield EfW facilities.
|
|
During the year ended
December 31, 2018, we recorded a $7 million gain on the sale of
our equity interests in Koma Kulshan, a $204 million gain on
the sale of 50% of our Dublin project to our joint venture with the
Green Investment Group Limited and a $6 million gain on the sale of
our remaining interests in China.
|
(c)
|
During the year
ended December 31, 2018, we recorded a $3 million loss related
to the refinancing of our tax-exempt bonds and a $12 million loss
related to the redemption of our 6.375% Senior Notes due
2022.
|
(d)
|
During the year ended
December 31, 2019, we recorded $13 million of costs related to our
ongoing asset rationalization and portfolio optimization efforts,
early retirement program, and certain organizational restructuring
activities.
|
(e)
|
Adjustment for
capital equipment related expenditures at our service fee operated
facilities which are capitalized at facilities that we
own.
|
(f)
|
Includes certain
other items that are added back under the definition of Adjusted
EBITDA in Covanta Energy, LLC's credit agreement.
|
Covanta Holding
Corporation
|
Exhibit 5
|
Reconciliation of
Net Cash Provided by Operating Activities to Free Cash
Flow
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
Full Year
Estimated 2020
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited, in millions)
|
|
|
Net cash provided
by operating activities
|
$
|
114
|
|
|
$
|
91
|
|
|
$
|
226
|
|
|
$
|
238
|
|
|
$260 -
$290
|
Add: Changes in
restricted funds - operating (a)
|
2
|
|
|
(3)
|
|
|
20
|
|
|
4
|
|
|
-
|
Less: Maintenance
capital expenditures (b)
|
(25)
|
|
|
(47)
|
|
|
(106)
|
|
|
(142)
|
|
|
(150 -
160)
|
Free Cash
Flow
|
$
|
91
|
|
|
$
|
41
|
|
|
$
|
140
|
|
|
$
|
100
|
|
|
$100 -
$140
|
|
|
|
(a) Adjustment
for the impact of the adoption of ASU 2016-18 effective January 1,
2018. As a result of
adoption, the statement of
cash flows explains the change during the period in the total of
cash, cash
equivalents, and amounts
generally described as restricted cash or restricted cash
equivalents. Therefore,
changes in restricted funds
are eliminated in arriving at net cash, cash equivalents and
restricted funds
provided by operating
activities.
|
|
|
|
|
|
(b)
Purchases of property, plant and equipment are also referred to as
capital expenditures. Capital
expenditures that
primarily maintain existing facilities are classified as
maintenance capital
expenditures. The
following table provides the components of total purchases of
property, plant and
equipment:
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
Maintenance capital
expenditures
|
$
|
(25)
|
|
|
$
|
(47)
|
|
|
$
|
(106)
|
|
|
$
|
(142)
|
|
|
|
Net maintenance
capital expenditures paid but
incurred in prior periods
|
(2)
|
|
|
9
|
|
|
(9)
|
|
|
(1)
|
|
|
|
Capital expenditures
associated with construction
of Dublin EfW facility
|
—
|
|
|
—
|
|
|
—
|
|
|
(22)
|
|
|
|
Capital expenditures
associated with the New York
City MTS contract
|
—
|
|
|
(4)
|
|
|
(19)
|
|
|
(13)
|
|
|
|
Capital expenditures
associated with organic
growth initiatives
|
(8)
|
|
|
(6)
|
|
|
(22)
|
|
|
(24)
|
|
|
|
Total capital
expenditures associated with growth
investments (c)
|
(8)
|
|
|
(10)
|
|
|
(41)
|
|
|
(59)
|
|
|
|
Capital expenditures
associated with property
insurance events
|
(2)
|
|
|
—
|
|
|
(2)
|
|
|
(4)
|
|
|
|
Total purchases of
property, plant and equipment
|
$
|
(37)
|
|
|
$
|
(48)
|
|
|
$
|
(158)
|
|
|
$
|
(206)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c) Total
growth investments represents investments in growth opportunities,
including organic growth
initiatives, technology,
business development, and other similar expenditures.
|
|
|
|
|
|
Capital expenditures
associated with growth
investments
|
$
|
(8)
|
|
|
$
|
(10)
|
|
|
$
|
(41)
|
|
|
$
|
(59)
|
|
|
|
UK business
development projects
|
(2)
|
|
|
(1)
|
|
|
(3)
|
|
|
(5)
|
|
|
|
Investment in equity
affiliate
|
(5)
|
|
|
(16)
|
|
|
(14)
|
|
|
(16)
|
|
|
|
Asset and business
acquisitions, net of cash acquired
|
—
|
|
|
—
|
|
|
2
|
|
|
(50)
|
|
|
|
Total growth
investments
|
$
|
(15)
|
|
|
$
|
(27)
|
|
|
$
|
(56)
|
|
|
$
|
(130)
|
|
|
|
Covanta Holding
Corporation
|
|
|
|
Exhibit
6
|
Supplemental
Information
|
|
|
|
|
(Unaudited, $ in
millions)
|
|
|
|
|
|
|
Twelve Months
Ended
December 31,
|
|
|
2019
|
|
2018
|
REVENUE:
|
|
|
|
|
Waste and service
revenue:
|
|
|
|
|
EfW tip
fees
|
|
$
|
638
|
|
|
$
|
624
|
|
EfW service
fees
|
|
466
|
|
|
424
|
|
Environmental
services (a)
|
|
140
|
|
|
141
|
|
Municipal services
(b)
|
|
231
|
|
|
207
|
|
Other
(c)
|
|
34
|
|
|
38
|
|
Intercompany
(d)
|
|
(116)
|
|
|
(107)
|
|
Total waste and
service
|
|
1,393
|
|
|
1,327
|
|
Energy
revenue:
|
|
|
|
|
Energy
sales
|
|
273
|
|
|
291
|
|
Capacity
|
|
44
|
|
|
52
|
|
Other
(e)
|
|
12
|
|
|
—
|
|
Total
energy
|
|
329
|
|
|
343
|
|
Recycled metals
revenue:
|
|
|
|
|
Ferrous
|
|
46
|
|
|
58
|
|
Non-ferrous
|
|
40
|
|
|
37
|
|
Total recycled
metals
|
|
86
|
|
|
95
|
|
Other revenue
(f)
|
|
62
|
|
|
103
|
|
Total
revenue
|
|
$
|
1,870
|
|
|
$
|
1,868
|
|
|
|
|
|
|
OPERATING
EXPENSE:
|
|
|
|
|
Plant operating
expense:
|
|
|
|
|
Plant
maintenance
|
|
$
|
308
|
|
|
$
|
299
|
|
Other plant operating
expense
|
|
1,063
|
|
|
1,023
|
|
Total plant operating
expense
|
|
1,371
|
|
|
1,321
|
|
Other operating
expense
|
|
64
|
|
|
65
|
|
General and
administrative
|
|
122
|
|
|
115
|
|
Depreciation and
amortization
|
|
221
|
|
|
218
|
|
Impairment
charges
|
|
2
|
|
|
86
|
|
Total operating
expense
|
|
$
|
1,780
|
|
|
$
|
1,805
|
|
|
|
|
|
|
Operating
income
|
|
$
|
90
|
|
|
$
|
63
|
|
|
|
|
|
|
Plus: impairment
charges
|
|
2
|
|
|
86
|
|
Operating
income excluding impairment charges
|
|
$
|
92
|
|
|
$
|
149
|
|
|
|
|
|
|
(a) Includes the
operation of material processing facilities and related services
provided by our Covanta Environmental Solutions
business.
|
(b) Consists of
transfer stations and the transportation component of our NYC
Marine Transfer Station contract.
|
(c) Includes waste
brokerage, debt service and other revenue not directly related to
EfW waste processing activities.
|
(d) Consists of
elimination of intercompany transactions primarily relating to
transfer stations.
|
(e) Primarily
components of wholesale load serving revenue not included in Energy
sales line, such as transmission and ancillaries.
|
(f) Consists
primarily of construction revenue.
|
Note: Certain amounts
may not total due to rounding.
|
Covanta Holding
Corporation
|
|
|
|
|
Exhibit
7
|
Revenue and
Operating Income Changes - FY 2018 to FY 2019
|
|
|
|
|
|
|
(Unaudited, $ in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract
Transitions(b)
|
|
|
|
|
|
|
|
FY
2018
|
|
Organic
Growth (a)
|
|
%
|
|
Waste
|
|
Transactions
(c)
|
|
Total
Changes
|
|
FY
2019
|
REVENUE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Waste and
service:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EfW tip
fees
|
$
|
624
|
|
|
$
|
28
|
|
|
4.6
|
%
|
|
$
|
13
|
|
|
$
|
(28)
|
|
|
$
|
14
|
|
|
$
|
638
|
|
EfW service
fees
|
424
|
|
|
13
|
|
|
3.0
|
%
|
|
(17)
|
|
|
46
|
|
|
42
|
|
|
466
|
|
Environmental
services
|
141
|
|
|
—
|
|
|
(0.3)
|
%
|
|
—
|
|
|
—
|
|
|
(1)
|
|
|
140
|
|
Municipal
services
|
207
|
|
|
8
|
|
|
3.6
|
%
|
|
—
|
|
|
17
|
|
|
24
|
|
|
231
|
|
Other
revenue
|
38
|
|
|
—
|
|
|
1.1
|
%
|
|
(4)
|
|
|
(1)
|
|
|
(5)
|
|
|
34
|
|
Intercompany
|
(107)
|
|
|
(5)
|
|
|
|
|
—
|
|
|
(4)
|
|
|
(9)
|
|
|
(116)
|
|
Total waste and
service
|
1,327
|
|
|
44
|
|
|
3.3
|
%
|
|
(7)
|
|
|
29
|
|
|
66
|
|
|
1,393
|
|
Energy
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Energy
sales
|
291
|
|
|
(17)
|
|
|
(5.7)
|
%
|
|
7
|
|
|
(8)
|
|
|
(18)
|
|
|
273
|
|
Capacity
|
52
|
|
|
(7)
|
|
|
(13.3)
|
%
|
|
—
|
|
|
(1)
|
|
|
(8)
|
|
|
44
|
|
Other
|
—
|
|
|
13
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
12
|
|
|
12
|
|
Total
energy
|
343
|
|
|
(11)
|
|
|
(3.2)
|
%
|
|
7
|
|
|
(9)
|
|
|
(14)
|
|
|
329
|
|
Recycled
metals:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ferrous
|
58
|
|
|
(13)
|
|
|
(22.7)
|
%
|
|
—
|
|
|
1
|
|
|
(12)
|
|
|
46
|
|
Non-ferrous
|
37
|
|
|
2
|
|
|
4.6
|
%
|
|
—
|
|
|
1
|
|
|
3
|
|
|
40
|
|
Total recycled
metals
|
95
|
|
|
(11)
|
|
|
(12.0)
|
%
|
|
—
|
|
|
2
|
|
|
(9)
|
|
|
86
|
|
Other
revenue
|
103
|
|
|
(40)
|
|
|
(38.6)
|
%
|
|
—
|
|
|
—
|
|
|
(41)
|
|
|
62
|
|
Total
revenue
|
$
|
1,868
|
|
|
$
|
(18)
|
|
|
(0.9)
|
%
|
|
$
|
(1)
|
|
|
$
|
21
|
|
|
$
|
2
|
|
|
$
|
1,870
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plant operating
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plant
maintenance
|
$
|
299
|
|
|
$
|
7
|
|
|
2.5
|
%
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
9
|
|
|
$
|
308
|
|
Other plant
operating
expense
|
1,023
|
|
|
22
|
|
|
2.2
|
%
|
|
4
|
|
|
14
|
|
|
40
|
|
|
1,063
|
|
Total plant
operating
expense
|
1,321
|
|
|
30
|
|
|
2.3
|
%
|
|
3
|
|
|
16
|
|
|
50
|
|
|
1,371
|
|
Other operating
expense
|
65
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
(1)
|
|
|
64
|
|
General and
administrative
|
115
|
|
|
7
|
|
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
122
|
|
Depreciation
and
amortization
|
218
|
|
|
(1)
|
|
|
|
|
(1)
|
|
|
5
|
|
|
3
|
|
|
221
|
|
Total operating
expense(d)
|
$
|
1,719
|
|
|
$
|
36
|
|
|
|
|
$
|
3
|
|
|
$
|
21
|
|
|
$
|
59
|
|
|
$
|
1,778
|
|
Operating income
(loss) (d)
|
$
|
149
|
|
|
$
|
(54)
|
|
|
|
|
$
|
(3)
|
|
|
$
|
1
|
|
|
$
|
(57)
|
|
|
$
|
92
|
|
|
|
(a) Reflects the
performance at each facility on a comparable period-over-period
basis, excluding the impacts of transitions and
transactions.
|
(b) Includes the
impact of the expiration of: (1) long-term major waste and service
contracts, most typically representing the transition to a new
contract structure, and (2) long-term energy contracts.
|
(c) Includes the
impacts of acquisitions, divestitures and the addition or loss of
operating contracts.
|
(d) Excludes
impairment charges
|
Note: Certain amounts
may not total due to rounding
|
EfW Operating
Metrics (Unaudited)
|
|
|
|
|
|
|
|
Exhibit 8
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
Three Months
Ended
|
|
Year
Ended
|
|
Mar
31,
|
|
Jun
30,
|
|
Sep
30,
|
|
Dec
31,
|
|
Dec
31,
|
|
Mar
31,
|
|
Jun
30,
|
|
Sep
30,
|
|
Dec
31,
|
|
Dec
31,
|
|
2019
|
|
2019
|
|
2019
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
2018
|
|
2018
|
|
2018
|
EfW
Waste
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons: (in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tip fee -
contracted
|
2.04
|
|
|
2.29
|
|
|
2.28
|
|
|
2.18
|
|
|
8.78
|
|
|
2.08
|
|
|
2.32
|
|
|
2.25
|
|
|
2.27
|
|
|
8.92
|
|
Tip fee -
uncontracted
|
0.54
|
|
|
0.43
|
|
|
0.48
|
|
|
0.57
|
|
|
2.01
|
|
|
0.65
|
|
|
0.44
|
|
|
0.46
|
|
|
0.53
|
|
|
2.08
|
|
Service
fee
|
2.62
|
|
|
2.70
|
|
|
2.74
|
|
|
2.64
|
|
|
10.70
|
|
|
2.11
|
|
|
2.31
|
|
|
2.37
|
|
|
2.75
|
|
|
9.54
|
|
Total tons
|
5.20
|
|
|
5.41
|
|
|
5.49
|
|
|
5.39
|
|
|
21.49
|
|
|
4.84
|
|
|
5.07
|
|
|
5.08
|
|
|
5.55
|
|
|
20.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EfW tip fee per
ton:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contracted
|
$
|
52.64
|
|
|
$
|
54.16
|
|
|
$
|
53.93
|
|
|
$
|
53.93
|
|
|
$
|
53.69
|
|
|
$
|
53.33
|
|
|
$
|
51.52
|
|
|
$
|
52.36
|
|
|
$
|
51.72
|
|
|
$
|
52.20
|
|
Uncontracted
|
$
|
76.57
|
|
|
$
|
89.06
|
|
|
$
|
85.22
|
|
|
$
|
81.31
|
|
|
$
|
82.61
|
|
|
$
|
65.38
|
|
|
$
|
84.05
|
|
|
$
|
80.27
|
|
|
$
|
78.58
|
|
|
$
|
75.97
|
|
Average revenue per
ton
|
$
|
57.66
|
|
|
$
|
59.66
|
|
|
$
|
59.36
|
|
|
$
|
59.58
|
|
|
$
|
59.08
|
|
|
$
|
56.20
|
|
|
$
|
56.68
|
|
|
$
|
57.13
|
|
|
$
|
56.78
|
|
|
$
|
56.70
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EfW
Energy
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Energy sales: (MWh in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contracted
|
0.47
|
|
|
0.47
|
|
|
0.55
|
|
|
0.57
|
|
|
2.06
|
|
|
0.52
|
|
|
0.52
|
|
|
0.53
|
|
|
0.55
|
|
|
2.12
|
|
Hedged
|
0.80
|
|
|
0.73
|
|
|
0.76
|
|
|
0.73
|
|
|
3.02
|
|
|
0.75
|
|
|
0.81
|
|
|
0.77
|
|
|
0.76
|
|
|
3.09
|
|
Market
|
0.29
|
|
|
0.37
|
|
|
0.38
|
|
|
0.27
|
|
|
1.31
|
|
|
0.33
|
|
|
0.30
|
|
|
0.33
|
|
|
0.36
|
|
|
1.32
|
|
Total energy
sales
|
1.56
|
|
|
1.57
|
|
|
1.69
|
|
|
1.56
|
|
|
6.38
|
|
|
1.60
|
|
|
1.62
|
|
|
1.62
|
|
|
1.67
|
|
|
6.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market sales by
geography:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PJM East
|
0.1
|
|
|
0.2
|
|
|
0.2
|
|
|
0.1
|
|
|
0.6
|
|
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
|
0.2
|
|
|
0.6
|
|
NEPOOL
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.3
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.2
|
|
NYISO
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
Other
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.3
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.3
|
|
Revenue per MWh:
(excludes capacity)
|
Contracted
|
$
|
67.33
|
|
|
$
|
66.00
|
|
|
$
|
62.77
|
|
|
$
|
67.33
|
|
|
$
|
65.80
|
|
|
$
|
67.86
|
|
|
$
|
64.81
|
|
|
$
|
65.41
|
|
|
$
|
68.21
|
|
|
$
|
66.59
|
|
Hedged
|
$
|
49.67
|
|
|
$
|
26.42
|
|
|
$
|
28.69
|
|
|
$
|
31.10
|
|
|
$
|
34.29
|
|
|
$
|
50.07
|
|
|
$
|
25.99
|
|
|
$
|
28.24
|
|
|
$
|
27.89
|
|
|
$
|
32.88
|
|
Market
|
$
|
32.44
|
|
|
$
|
21.69
|
|
|
$
|
25.36
|
|
|
$
|
27.22
|
|
|
$
|
26.31
|
|
|
$
|
44.08
|
|
|
$
|
30.86
|
|
|
$
|
33.66
|
|
|
$
|
38.98
|
|
|
$
|
37.12
|
|
Average revenue per
MWh
|
$
|
51.74
|
|
|
$
|
37.19
|
|
|
$
|
39.08
|
|
|
$
|
43.52
|
|
|
$
|
42.81
|
|
|
$
|
54.56
|
|
|
$
|
39.28
|
|
|
$
|
41.48
|
|
|
$
|
43.58
|
|
|
$
|
44.68
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metals
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons recovered, net:
(in thousands)
|
|
|
|
|
|
|
|
|
Ferrous
|
96.3
|
|
|
110.8
|
|
|
111.9
|
|
|
104.7
|
|
|
423.7
|
|
|
101.9
|
|
|
106.6
|
|
|
111.4
|
|
|
104.2
|
|
|
424.0
|
|
Non-ferrous
|
12.6
|
|
|
12.5
|
|
|
12.8
|
|
|
13.0
|
|
|
50.8
|
|
|
11.1
|
|
|
11.7
|
|
|
12.9
|
|
|
13.6
|
|
|
49.3
|
|
Tons sold, net: (in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ferrous
|
84.0
|
|
|
94.9
|
|
|
96.4
|
|
|
94.9
|
|
|
370.3
|
|
|
76.6
|
|
|
81.4
|
|
|
89.8
|
|
|
85.1
|
|
|
332.8
|
|
Non-ferrous
|
8.3
|
|
|
6.7
|
|
|
8.2
|
|
|
10.4
|
|
|
33.7
|
|
|
7.5
|
|
|
7.0
|
|
|
6.8
|
|
|
9.2
|
|
|
30.6
|
|
Revenue per ton: ($
in millions)
|
|
|
|
|
|
|
|
|
Ferrous
|
$
|
137
|
|
|
$
|
132
|
|
|
$
|
118
|
|
|
$
|
108
|
|
|
$
|
123
|
|
|
$
|
193
|
|
|
$
|
182
|
|
|
$
|
159
|
|
|
$
|
162
|
|
|
$
|
173
|
|
Non-ferrous
|
$
|
1,123
|
|
|
$
|
1,255
|
|
|
$
|
984
|
|
|
$
|
1,346
|
|
|
$
|
1,184
|
|
|
$
|
1,192
|
|
|
$
|
1,432
|
|
|
$
|
1,360
|
|
|
$
|
971
|
|
|
$
|
1,218
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EfW plant
operating expenses: ($ in millions)
|
Plant operating
expenses
- gross
|
$
|
294
|
|
|
$
|
278
|
|
|
$
|
256
|
|
|
$
|
269
|
|
|
$
|
1,097
|
|
|
$
|
282
|
|
|
$
|
264
|
|
|
$
|
240
|
|
|
$
|
271
|
|
|
$
|
1,057
|
|
Less: Client
pass-
through costs
|
(13)
|
|
|
(12)
|
|
|
(12)
|
|
|
(20)
|
|
|
(57)
|
|
|
(14)
|
|
|
(12)
|
|
|
(12)
|
|
|
(19)
|
|
|
(57)
|
|
Less: REC sales
-
contra-expense
|
(3)
|
|
|
(2)
|
|
|
(4)
|
|
|
(3)
|
|
|
(12)
|
|
|
(3)
|
|
|
(3)
|
|
|
(4)
|
|
|
(4)
|
|
|
(12)
|
|
Plant operating
expenses
- reported
|
$
|
278
|
|
|
$
|
264
|
|
|
$
|
240
|
|
|
$
|
247
|
|
|
$
|
1,028
|
|
|
$
|
266
|
|
|
$
|
250
|
|
|
$
|
224
|
|
|
$
|
248
|
|
|
$
|
988
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Waste volume
includes solid tons only. Metals and energy volume are presented
net of client revenue sharing. Steam sales are converted to
MWh equivalent at an assumed average rate of 11 klbs of steam /
MWh. Uncontracted energy sales include sales under PPAs that
are based on market prices.
|
Note: Certain amounts
may not total due to rounding
|
Discussion of Non-GAAP Financial Measures
We use a number of different financial measures, both
United States generally accepted
accounting principles ("GAAP") and non-GAAP, in assessing the
overall performance of our business. To supplement our
assessment of results prepared in accordance with GAAP, we use the
measures of Adjusted EBITDA and Free Cash Flow, which are non-GAAP
financial measures as defined by the Securities and Exchange
Commission. The non-GAAP financial measures of Adjusted
EBITDA and Free Cash Flow as described below, and used in the
tables above, are not intended as a substitute or as an alternative
to net income, cash flow provided by operating activities or
diluted earnings per share as indicators of our performance or
liquidity or any other measures of performance or liquidity derived
in accordance with GAAP. In addition, our non-GAAP financial
measures may be different from non-GAAP measures used by other
companies, limiting their usefulness for comparison purposes.
The presentations of Adjusted EBITDA and Free Cash Flow are
intended to enhance the usefulness of our financial information by
providing measures which management internally use to assess and
evaluate the overall performance of its business and those of
possible acquisition candidates, and highlight trends in the
overall business.
Adjusted EBITDA
We use Adjusted EBITDA to provide additional ways of viewing
aspects of operations that, when viewed with the GAAP results
provide a more complete understanding of our core business. As we
define it, Adjusted EBITDA represents earnings before interest,
taxes, depreciation and amortization, as adjusted for additional
items subtracted from or added to net income including the effects
of impairment losses, gains or losses on sales, dispositions or
retirements of assets, adjustments to reflect the Adjusted EBITDA
from our unconsolidated investments, adjustments to exclude
significant unusual or non-recurring items that are not directly
related to our operating performance plus adjustments to capital
type expenses for our service fee facilities in line with our
credit agreements. We adjust for these items in our Adjusted EBITDA
as our management believes that these items would distort their
ability to efficiently view and assess our core operating trends.
As larger parts of our business are conducted through
unconsolidated investments, we adjust EBITDA for our proportionate
share of the entity's depreciation and amortization, interest
expense, tax expense and other adjustments to exclude significant
unusual or non-recurring items that are not directly related to the
entity's operating performance. in order to improve
comparability to the Adjusted EBITDA of our wholly owned entities.
We do not have control, nor have any legal claim to the portion of
our unconsolidated investees' revenues and expenses allocable to
our joint venture partners. As we do not control, but do exercise
significant influence, we account for these unconsolidated
investments in accordance with the equity method of accounting. Net
income (losses) from these investments are reflected within our
consolidated statements of operations in Equity in net income from
unconsolidated investments. In order to provide a meaningful basis
for comparison, we are providing information with respect to our
Adjusted EBITDA for the year ended December 31, 2019 and 2018,
reconciled for each such period to net income and cash flow
provided by operating activities, which are believed to be the most
directly comparable measures under GAAP.
Our projections of the proportional contribution of our
interests in joint ventures to our Adjusted EBITDA and Free Cash
Flow are not based on GAAP net income/loss or cash flow provided by
operating activities, respectively, and are anticipated to be
adjusted to exclude the effects of events or circumstances in 2020
that are not representative or indicative of our results of
operations and that are not currently determinable. Due to the
uncertainty of the likelihood, amount and timing of any such
adjusting items, we do not have information available to provide a
quantitative reconciliation of projected net income/loss to an
Adjusted EBITDA projection.
Free Cash Flow
Free Cash Flow is defined as cash flow provided by operating
activities, plus changes in operating restricted funds, less
maintenance capital expenditures, which are capital expenditures
primarily to maintain our existing facilities.
We use the non-GAAP measure of Free Cash Flow as a criterion of
liquidity and performance-based components of employee
compensation. We use Free Cash Flow as a measure of liquidity
to determine amounts we can reinvest in our core businesses, such
as amounts available to make acquisitions, invest in construction
of new projects, make principal payments on debt, or amounts we can
return to our stockholders through dividends and/or stock
repurchases.
In order to provide a meaningful basis for comparison, we are
providing information with respect to our Free Cash Flow for the
year ended December 31, 2019 and 2018, reconciled for each
such period to cash flow provided by operating activities, which we
believe to be the most directly comparable measure under GAAP.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
Certain statements in this press release may constitute
"forward-looking" statements as defined in Section 27A of the
Securities Act of 1933, as amended (the "Securities Act"), Section
21E of the Securities Exchange Act of 1934 (the "Exchange Act"),
the Private Securities Litigation Reform Act of 1995 (the "PSLRA")
or in releases made by the Securities and Exchange Commission
("SEC"), all as may be amended from time to time. Such
forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the
actual results, performance or achievements of Covanta Holding
Corporation and its subsidiaries ("Covanta") or industry results,
to differ materially from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Statements that are not historical fact are
forward-looking statements. Forward-looking statements can be
identified by, among other things, the use of forward-looking
language, such as the words "plan," "believe," "expect,"
"anticipate," "intend," "estimate," "project," "may," "will,"
"would," "could," "should," "seeks," or "scheduled to," or other
similar words, or the negative of these terms or other variations
of these terms or comparable language, or by discussion of strategy
or intentions. These cautionary statements are being made
pursuant to the Securities Act, the Exchange Act and the PSLRA with
the intention of obtaining the benefits of the "safe harbor"
provisions of such laws. Covanta cautions investors that any
forward-looking statements made by Covanta are not guarantees or
indicative of future performance. Important factors, risks,
and uncertainties that could cause actual results of Covanta and
our joint ventures to differ materially from those forward-looking
statements include, but are not limited to:
- seasonal or long-term fluctuations in the prices of energy,
waste disposal, scrap metal and commodities, and Covanta's ability
to renew or replace expiring contracts at comparable prices and
with other acceptable terms;
- adoption of new laws and regulations in the United States and abroad, including energy
laws, tax laws, environmental laws, labor laws and healthcare
laws;
- advances in technology;
- difficulties in the operation of our facilities, including fuel
supply and energy delivery interruptions, failure to obtain
regulatory approvals, equipment failures, labor disputes and work
stoppages, and weather interference and catastrophic events;
- failure to maintain historical performance levels at Covanta's
facilities and Covanta's ability to retain the rights to operate
facilities Covanta does not own;
- Covanta's and the joint ventures ability to avoid adverse
publicity or reputational damage relating to its business;
- difficulties in the financing, development and construction of
new projects and expansions, including increased construction costs
and delays;
- Covanta's ability to realize the benefits of long-term business
development and bear the costs of business development over
time;
- Covanta's ability to utilize net operating loss
carryforwards;
- limits of insurance coverage;
- Covanta's ability to avoid defaults under its long-term
contracts;
- performance of third parties under its contracts and such third
parties' observance of laws and regulations;
- concentration of suppliers and customers;
- geographic concentration of facilities;
- increased competitiveness in the energy and waste
industries;
- changes in foreign currency exchange rates;
- limitations imposed by Covanta's existing indebtedness and its
ability to perform its financial obligations and guarantees and to
refinance its existing indebtedness;
- exposure to counterparty credit risk and instability of
financial institutions in connection with financing
transactions;
- the scalability of its business;
- restrictions in its certificate of incorporation and debt
documents regarding strategic alternatives;
- failures of disclosure controls and procedures and internal
controls over financial reporting;
- Covanta's and the joint ventures ability to attract and retain
talented people;
- general economic conditions in the
United States and abroad, including the availability of
credit and debt financing; and
- other risks and uncertainties affecting Covanta's businesses
described periodic securities filings by Covanta with the SEC.
Although Covanta believes that its plans, cost estimates,
returns on investments, intentions and expectations reflected in or
suggested by such forward-looking statements are reasonable, actual
results could differ materially from a projection or assumption in
any forward-looking statements. Covanta's and the joint ventures
future financial condition and results of operations, as well as
any forward-looking statements, are subject to change and to
inherent risks and uncertainties. The forward-looking
statements contained in this press release are made only as of the
date hereof and Covanta does not have, or undertake, any obligation
to update or revise any forward-looking statements whether as a
result of new information, subsequent events or otherwise, unless
otherwise required by law.
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SOURCE Covanta Holding Corporation