- Exceeded Full-Year 2023 Financial Guidance
- Fourth Quarter Total Revenue Growth of 8.6 Percent Included
Approximately 2.9 Percent Growth from Acquisitions
- Fourth Quarter Earnings Per Share of $1.39 and Adjusted Earnings Per Share of
$1.41
- Expanded Fourth Quarter Net Income Margin 170 Basis Points and
Adjusted EBITDA Margin 260 Basis Points
- Generated Cash Flow from Operations of $3,618 Million and Adjusted Free Cash Flow of
$1,985 Million in 2023
- Invested $1.8 Billion in
Value-Creating Acquisitions and Returned $900 Million to Shareholders in 2023
PHOENIX, Feb. 27,
2024 /PRNewswire/ -- Republic Services, Inc. (NYSE:
RSG) today reported net income of $439.6
million, or $1.39 per diluted
share, for the three months ended December
31, 2023, versus $346.8
million, or $1.09 per diluted
share, for the comparable 2022 period. Excluding certain expenses
and other items, on an adjusted basis, net income for the three
months ended December 31, 2023 was
$446.4 million, or $1.41 per diluted share, versus $358.1 million, or $1.13 per diluted share, for the comparable 2022
period.
For the year ended December 31,
2023, net income was $1,731.0
million, or $5.47 per diluted
share, versus $1,487.6 million, or
$4.69 per diluted share, for the
comparable 2022 period. Excluding certain benefits and expenses, on
an adjusted basis, net income for the year ended December 31, 2023 was $1,775.1 million, or $5.61 per diluted share, versus $1,562.8 million, or $4.93 per diluted share, for the comparable 2022
period.
"We finished the year strong and produced results that exceeded
our expectations," said Jon Vander Ark, president and chief
executive officer. "During 2023, we delivered double-digit growth
in revenue, EBITDA, earnings and free cash flow, while continuing
to invest in the business to accelerate profitable growth."
Fourth-Quarter 2023 Highlights:
- Total revenue growth of 8.6 percent includes 5.7 percent
organic growth and 2.9 percent growth from acquisitions.
- Core price on total revenue increased revenue by 7.2 percent.
Core price on related business revenue increased revenue by 8.8
percent, which consisted of 10.6 percent in the open market and 6.0
percent in the restricted portion of the business.
- Revenue growth from average yield on total revenue was 6.3
percent, and volume increased revenue by 0.3 percent. Revenue
growth from average yield on related business revenue was 7.7
percent, and volume increased related business revenue by 0.4
percent.
- Net income was $439.6 million, or
a margin of 11.5 percent.
- EPS was $1.39 per share, an
increase of 27.5 percent over the prior year.
- Adjusted EPS, a non-GAAP measure, was $1.41 per share, an increase of 24.8 percent over
the prior year.
- Adjusted EBITDA, a non-GAAP measure, was $1,145.2 million, and adjusted EBITDA margin, a
non-GAAP measure, was 29.9 percent of revenue, an increase of 260
basis points over the prior year.
- Cash invested in acquisitions was $828
million.
- The Company completed construction on its first Polymer Center,
located in Las Vegas.
- The Company's average recycled commodity price per ton sold
during the fourth quarter was $131.
This represents an increase of $19
per ton from the third quarter of 2023 and an increase of
$43 per ton over the prior year.
Full-Year 2023 Highlights:
- Total revenue growth of 10.8 percent includes 6.0 percent
organic growth and 4.8 percent growth from acquisitions.
- Core price on total revenue increased revenue by 7.4 percent.
Core price on related business revenue increased revenue by 8.9
percent, which consisted of 10.9 percent in the open market and 5.6
percent in the restricted portion of the business.
- Revenue growth from average yield on total revenue was 6.1
percent, and volume increased revenue by 0.5 percent. Revenue
growth from average yield on related business revenue was 7.3
percent, and volume increased related business revenue by 0.7
percent.
- Net income was $1,731.0 million,
or a margin of 11.6 percent.
- EPS was $5.47 per share, an
increase of 16.6 percent over the prior year.
- Adjusted EPS, a non-GAAP measure, was $5.61 per share, an increase of 13.8 percent over
the prior year.
- Adjusted EBITDA, a non-GAAP measure, was $4,447.1 million and adjusted EBITDA margin, a
non-GAAP measure, was 29.7 percent of revenue, an increase of 60
basis points over the prior year.
- Cash provided by operating activities was $3,617.8 million, an increase of 13.4 percent
over the prior year.
- Adjusted free cash flow, a non-GAAP measure, was $1,985.1 million, an increase of 13.9 percent
versus the prior year. Adjusted free cash flow exceeded the
Company's guidance.
- Cash invested in acquisitions was $1.8
billion.
- Five renewable natural gas projects were completed and
commenced operations during the year.
- Cash returned to shareholders was $899.9
million, which included $261.8
million of share repurchases and $638.1 million of dividends paid.
- The Company's average recycled commodity price per ton sold
during the year was $117. This
represents a decrease of $53 per ton
over the prior year.
2024 Financial Guidance
Republic's financial guidance is based on current economic
conditions and does not assume any significant changes in the
overall economy in 2024. Please refer to the Reconciliation of 2024
Financial Guidance section of this document for detail relating to
the computation of non-GAAP measures as well as the Information
Regarding Forward-Looking Statements section of this document.
Full-year 2024 financial guidance is as follows:
- Revenue: Republic expects revenue to be in the range of
$16.100 billion to $16.200 billion. The Company expects growth from
average yield on total revenue to be in the range of 5.5% to 6.0%
and volume growth to be in the range of 0.0% to 0.5%. Average yield
on related business revenue is expected to be in the range of 6.5%
to 7.0%.
- Adjusted EBITDA: Republic expects adjusted EBITDA to be
in the range of $4.825 billion to
$4.875 billion.
- Adjusted Diluted Earnings per Share: The Company expects
adjusted diluted earnings per share to be in the range of
$5.94 to $6.00.
- Adjusted Free Cash Flow: Republic expects adjusted free
cash flow to be in the range of $2.100
billion to $2.150 billion. The
Company expects to receive between $1.760
billion to $1.800 billion of
property and equipment, net of proceeds from the sale of property
and equipment.
- Acquisitions: Republic expects to invest at least
$500 million in acquisitions in 2024.
The 2024 financial guidance provided above only includes the
expected contribution from acquisitions that closed through
December 31, 2023.
"We expect another outsized year of growth in revenue, EBITDA,
earnings and free cash flow in 2024," said Mr. Vander Ark. "Our
strong financial guidance is supported by pricing in excess of cost
inflation, leveraging our digital tools to enhance productivity and
improve customer loyalty, and continuing to invest in
Sustainability Innovation to drive long-term value creation."
Company Declared Quarterly Dividend
Republic previously announced that its Board of Directors
declared a regular quarterly dividend of $0.535 per share for shareholders of record on
April 2, 2024. The dividend will be
paid on April 15, 2024.
Presentation of Certain Performance Metrics
and Non-GAAP Measures
Adjusted diluted earnings per share, adjusted net income,
EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA by
business type, adjusted EBITDA margin by business type and adjusted
free cash flow are described in the Performance Metrics and
Reconciliations of Certain Non-GAAP Measures section of this
document.
About Republic Services
Republic Services, Inc. is a leader in the environmental
services industry. Through its subsidiaries, the Company provides
customers with the most complete set of products and services,
including recycling, solid waste, special waste, hazardous waste
and field services. Republic's industry-leading commitments to
advance circularity and support decarbonization are helping deliver
on its vision to partner with customers to create a more
sustainable world. For more information, please
visit RepublicServices.com.
For more
information, contact:
|
|
Media
Inquiries
|
Investor
Inquiries
|
Roman Blahoski (480)
718-0328
|
Aaron Evans (480)
718-0309
|
media@RepublicServices.com
|
investor@RepublicServices.com
|
SUPPLEMENTAL
UNAUDITED FINANCIAL INFORMATION
|
AND OPERATING
DATA
|
|
|
|
|
REPUBLIC SERVICES,
INC.
|
CONSOLIDATED BALANCE
SHEETS
|
(in millions,
except per share amounts)
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
|
ASSETS
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
140.0
|
|
$
143.4
|
Accounts receivable,
less allowance for doubtful accounts and other of $83.2 and $51.9,
respectively
|
1,768.4
|
|
1,677.2
|
Prepaid expenses and
other current assets
|
472.6
|
|
536.5
|
Total current
assets
|
2,381.0
|
|
2,357.1
|
Restricted cash and
marketable securities
|
163.6
|
|
127.6
|
Property and equipment,
net
|
11,350.9
|
|
10,744.0
|
Goodwill
|
15,834.5
|
|
14,451.5
|
Other intangible
assets, net
|
496.2
|
|
347.2
|
Other assets
|
1,183.9
|
|
1,025.5
|
Total
assets
|
$
31,410.1
|
|
$
29,052.9
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
1,411.5
|
|
$
1,221.8
|
Notes payable and
current maturities of long-term debt
|
932.3
|
|
456.0
|
Deferred
revenue
|
467.3
|
|
443.0
|
Accrued landfill and
environmental costs, current portion
|
141.6
|
|
132.6
|
Accrued
interest
|
104.1
|
|
79.0
|
Other accrued
liabilities
|
1,171.5
|
|
1,058.3
|
Total current
liabilities
|
4,228.3
|
|
3,390.7
|
Long-term debt, net of
current maturities
|
11,887.1
|
|
11,329.5
|
Accrued landfill and
environmental costs, net of current portion
|
2,281.0
|
|
2,141.3
|
Deferred income taxes
and other long-term tax liabilities, net
|
1,526.8
|
|
1,528.8
|
Insurance reserves, net
of current portion
|
348.8
|
|
315.1
|
Other long-term
liabilities
|
594.6
|
|
660.7
|
Commitments and
contingencies
|
|
|
|
Stockholders'
equity:
|
|
|
|
Preferred stock, par
value $0.01 per share; 50 shares authorized; none issued
|
—
|
|
—
|
Common stock, par value
$0.01 per share; 750 shares authorized; 320.7 and 320.3 issued
including shares
held in treasury, respectively
|
3.2
|
|
3.2
|
Additional paid-in
capital
|
2,900.8
|
|
2,843.2
|
Retained
earnings
|
8,433.9
|
|
7,356.3
|
Treasury stock, at
cost; 6.1 and 4.2 shares, respectively
|
(783.5)
|
|
(504.6)
|
Accumulated other
comprehensive loss, net of tax
|
(12.1)
|
|
(12.1)
|
Total Republic
Services, Inc. stockholders' equity
|
10,542.3
|
|
9,686.0
|
Non-controlling
interests in consolidated subsidiary
|
1.2
|
|
0.8
|
Total stockholders'
equity
|
10,543.5
|
|
9,686.8
|
Total liabilities and
stockholders' equity
|
$
31,410.1
|
|
$
29,052.9
|
REPUBLIC SERVICES,
INC.
|
UNAUDITED
CONSOLIDATED STATEMENTS OF INCOME
|
(in millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Revenue
|
$
3,831.6
|
|
$
3,529.7
|
|
$
14,964.5
|
|
$
13,511.3
|
Expenses:
|
|
|
|
|
|
|
|
Cost of
operations
|
2,264.1
|
|
2,181.3
|
|
8,942.2
|
|
8,205.0
|
Depreciation,
amortization and depletion
|
402.0
|
|
349.8
|
|
1,501.4
|
|
1,351.6
|
Accretion
|
24.7
|
|
22.7
|
|
97.9
|
|
89.6
|
Selling, general and
administrative
|
431.4
|
|
395.3
|
|
1,608.7
|
|
1,454.3
|
Adjustment to
withdrawal liability for a multiemployer pension fund
|
4.5
|
|
(3.8)
|
|
4.5
|
|
(1.6)
|
Gain (loss) on
business divestitures and impairments, net
|
(2.1)
|
|
(1.0)
|
|
(3.6)
|
|
(6.3)
|
Restructuring
charges
|
6.0
|
|
8.2
|
|
33.2
|
|
27.0
|
Operating
income
|
701.0
|
|
577.2
|
|
2,780.2
|
|
2,391.7
|
Interest
expense
|
(129.4)
|
|
(112.9)
|
|
(508.2)
|
|
(395.6)
|
Loss on extinguishment
of debt
|
—
|
|
—
|
|
(0.2)
|
|
—
|
Loss from
unconsolidated equity method investments
|
(94.5)
|
|
(96.4)
|
|
(94.3)
|
|
(165.6)
|
Interest
income
|
1.5
|
|
1.4
|
|
6.5
|
|
3.3
|
Other income (expense),
net
|
4.3
|
|
4.1
|
|
7.5
|
|
(2.3)
|
Income before income
taxes
|
482.9
|
|
373.4
|
|
2,191.5
|
|
1,831.5
|
Provision for income
taxes
|
43.2
|
|
26.4
|
|
460.1
|
|
343.9
|
Net income
|
439.7
|
|
347.0
|
|
1,731.4
|
|
1,487.6
|
Net income
attributable to non-controlling interests in consolidated
subsidiary
|
(0.1)
|
|
(0.2)
|
|
(0.4)
|
|
—
|
Net income
attributable to Republic Services, Inc.
|
$
439.6
|
|
$
346.8
|
|
$
1,731.0
|
|
$
1,487.6
|
Basic earnings per
share attributable to Republic Services, Inc.
stockholders:
|
|
|
|
|
|
|
|
Basic earnings per
share
|
$
1.40
|
|
$
1.10
|
|
$
5.47
|
|
$
4.70
|
Weighted average
common shares outstanding
|
315.1
|
|
316.5
|
|
316.2
|
|
316.5
|
Diluted earnings per
share attributable to Republic Services, Inc.
stockholders:
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
$
1.39
|
|
$
1.09
|
|
$
5.47
|
|
$
4.69
|
Weighted average
common and common equivalent shares outstanding
|
315.7
|
|
317.1
|
|
316.7
|
|
317.1
|
Cash dividends per
common share
|
$
0.535
|
|
$
0.495
|
|
$
2.060
|
|
$
1.910
|
REPUBLIC SERVICES,
INC.
|
UNAUDITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in
millions)
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
Cash provided by
operating activities:
|
|
|
|
Net income
|
$
1,731.4
|
|
$
1,487.6
|
Adjustments to
reconcile net income to cash provided by operating
activities:
|
|
|
|
Depreciation,
amortization, depletion and accretion
|
1,599.3
|
|
1,441.2
|
Non-cash interest
expense
|
85.8
|
|
71.6
|
Stock-based
compensation
|
40.9
|
|
38.8
|
Deferred tax
provision
|
101.7
|
|
181.1
|
Provision for doubtful
accounts, net of adjustments
|
53.2
|
|
41.5
|
Loss on extinguishment
of debt
|
0.2
|
|
—
|
Gain on disposition of
assets and asset impairments, net
|
(1.2)
|
|
(9.2)
|
Environmental
adjustments
|
2.0
|
|
2.9
|
(Gain) loss from
unconsolidated equity method investments
|
94.3
|
|
165.6
|
Other non-cash
items
|
(1.6)
|
|
(0.1)
|
Change in assets and
liabilities, net of effects from business acquisitions and
divestitures:
|
|
|
|
Accounts
receivable
|
(71.3)
|
|
(198.8)
|
Prepaid expenses and
other assets
|
(29.8)
|
|
(83.8)
|
Accounts
payable
|
82.8
|
|
106.4
|
Capping, closure and
post-closure expenditures
|
(60.8)
|
|
(64.6)
|
Remediation
expenditures
|
(54.9)
|
|
(54.7)
|
Other
liabilities
|
43.4
|
|
64.5
|
Proceeds for retirement
of certain hedging relationships
|
2.4
|
|
—
|
Cash provided by
operating activities
|
3,617.8
|
|
3,190.0
|
Cash (used in) provided
by investing activities:
|
|
|
|
Purchases of property
and equipment
|
(1,631.1)
|
|
(1,454.0)
|
Proceeds from sales of
property and equipment
|
29.2
|
|
32.8
|
Cash used in
acquisitions and investments, net of cash and restricted cash
acquired
|
(2,065.3)
|
|
(3,038.5)
|
Cash received from
business divestitures
|
6.4
|
|
50.6
|
Purchases of restricted
marketable securities
|
(28.9)
|
|
(19.6)
|
Sales of restricted
marketable securities
|
13.1
|
|
19.7
|
Other
|
9.8
|
|
(14.0)
|
Cash used in investing
activities
|
(3,666.8)
|
|
(4,423.0)
|
Cash provided by (used
in) financing activities:
|
|
|
|
Proceeds from credit
facilities and notes payable, net of fees
|
39,221.1
|
|
16,446.3
|
Proceeds from issuance
of senior notes, net of discount and fees
|
2,172.3
|
|
—
|
Payments of credit
facilities and notes payable
|
(40,410.8)
|
|
(14,281.7)
|
Issuances of common
stock, net
|
(1.2)
|
|
(13.6)
|
Purchases of common
stock for treasury
|
(261.8)
|
|
(203.5)
|
Cash dividends
paid
|
(638.1)
|
|
(592.9)
|
Distributions paid to
non-controlling interests in consolidated subsidiary
|
—
|
|
(0.8)
|
Contingent
consideration payments
|
(19.6)
|
|
(9.6)
|
Cash (used in)
provided by financing activities
|
61.9
|
|
1,344.2
|
Effect of foreign
exchange rate changes on cash
|
0.3
|
|
(2.5)
|
Increase in cash, cash
equivalents, restricted cash and restricted cash
equivalents
|
13.2
|
|
108.7
|
Cash, cash equivalents,
restricted cash and restricted cash equivalents at beginning of
period
|
214.3
|
|
105.6
|
Cash, cash equivalents,
restricted cash and restricted cash equivalents at end of
period
|
$
227.5
|
|
$
214.3
|
You should read the following information in conjunction with
our audited consolidated financial statements and notes thereto
appearing in our Annual Report on Form 10-K as of and for the year
ended December 31, 2023 (when filed).
All amounts below are in millions and as a percentage of our
revenue, except per share data.
REVENUE
The following table reflects our total revenue by line of
business for the three months and years ended December 31, 2023 and 2022:
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Collection:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
$
719.2
|
|
18.8 %
|
|
$
679.6
|
|
19.3 %
|
|
$
2,822.7
|
|
18.9 %
|
|
$
2,642.6
|
|
19.5 %
|
Small-container
|
1,168.3
|
|
30.4
|
|
1,032.8
|
|
29.3
|
|
4,438.4
|
|
29.7
|
|
3,945.7
|
|
29.2
|
Large-container
|
730.0
|
|
19.1
|
|
683.1
|
|
19.3
|
|
2,922.4
|
|
19.5
|
|
2,701.1
|
|
20.0
|
Other
|
17.5
|
|
0.5
|
|
13.5
|
|
0.4
|
|
69.4
|
|
0.4
|
|
53.9
|
|
0.4
|
Total
collection
|
2,635.0
|
|
68.8
|
|
2,409.0
|
|
68.3
|
|
10,252.9
|
|
68.5
|
|
9,343.3
|
|
69.1
|
Transfer
|
418.5
|
|
|
|
391.0
|
|
|
|
1,699.1
|
|
|
|
1,574.5
|
|
|
Less:
intercompany
|
(230.3)
|
|
|
|
(212.3)
|
|
|
|
(933.7)
|
|
|
|
(849.8)
|
|
|
Transfer,
net
|
188.2
|
|
4.9
|
|
178.7
|
|
5.1
|
|
765.4
|
|
5.1
|
|
724.7
|
|
5.4
|
Landfill
|
713.0
|
|
|
|
662.0
|
|
|
|
2,885.4
|
|
|
|
2,681.7
|
|
|
Less:
intercompany
|
(293.4)
|
|
|
|
(280.0)
|
|
|
|
(1,206.0)
|
|
|
|
(1,131.9)
|
|
|
Landfill,
net
|
419.6
|
|
11.0
|
|
382.0
|
|
10.8
|
|
1,679.4
|
|
11.2
|
|
1,549.8
|
|
11.5
|
Environmental
solutions
|
427.4
|
|
|
|
434.2
|
|
|
|
1,701.4
|
|
|
|
1,262.1
|
|
|
Less:
intercompany
|
(14.0)
|
|
|
|
(16.8)
|
|
|
|
(76.5)
|
|
|
|
(53.9)
|
|
|
Environmental
solutions, net
|
413.4
|
|
10.8
|
|
417.4
|
|
11.8
|
|
1,624.9
|
|
10.9
|
|
1,208.2
|
|
8.9
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recycling processing
and commodity sales
|
85.7
|
|
2.2
|
|
58.7
|
|
1.7
|
|
312.3
|
|
2.1
|
|
359.1
|
|
2.7
|
Other
non-core
|
89.7
|
|
2.3
|
|
83.9
|
|
2.3
|
|
329.6
|
|
2.2
|
|
326.2
|
|
2.4
|
Total other
|
175.4
|
|
4.5
|
|
142.6
|
|
4.0
|
|
641.9
|
|
4.3
|
|
685.3
|
|
5.1
|
Total
revenue
|
$ 3,831.6
|
|
100.0 %
|
|
$ 3,529.7
|
|
100.0 %
|
|
$
14,964.5
|
|
100.0 %
|
|
$
13,511.3
|
|
100.0 %
|
The following table reflects changes in components of our
revenue, as a percentage of total revenue, for the three months and
years ended December 31, 2023 and
2022:
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Average
yield
|
6.3 %
|
|
5.9 %
|
|
6.1 %
|
|
5.2 %
|
Fuel recovery
fees
|
(0.3)
|
|
2.5
|
|
(0.2)
|
|
2.6
|
Total price
|
6.0
|
|
8.4
|
|
5.9
|
|
7.8
|
Volume
|
0.3
|
|
1.5
|
|
0.5
|
|
2.4
|
Change in
workdays
|
(0.1)
|
|
(0.4)
|
|
—
|
|
(0.1)
|
Recycling processing
and commodity sales
|
0.5
|
|
(1.8)
|
|
(0.5)
|
|
(0.6)
|
Environmental
solutions
|
(1.0)
|
|
0.6
|
|
0.1
|
|
0.5
|
Total internal
growth
|
5.7
|
|
8.3
|
|
6.0
|
|
10.0
|
Acquisitions /
divestitures, net
|
2.9
|
|
11.2
|
|
4.8
|
|
9.6
|
Total
|
8.6 %
|
|
19.5 %
|
|
10.8 %
|
|
19.6 %
|
|
|
|
|
|
|
|
|
Core price
|
7.2 %
|
|
7.4 %
|
|
7.4 %
|
|
6.7 %
|
Average yield is defined as revenue growth from the change in
average price per unit of service, expressed as a percentage. Core
price is defined as price increases to our customers and fees,
excluding fuel recovery fees, net of price decreases to retain
customers. We also measure changes in core price, average yield and
volume as a percentage of related-business revenue, defined as
total revenue excluding recycled commodities, fuel recovery fees
and environmental solutions revenue, to determine the effectiveness
of our pricing and organic growth strategies. The following table
reflects core price, average yield and volume as a percentage of
related-business revenue for the three months and years ended
December 31, 2023 and 2022:
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
As a % of Related
Business
|
|
As a % of Related
Business
|
Core price
|
8.8 %
|
|
8.4 %
|
|
8.9 %
|
|
7.3 %
|
Average
yield
|
7.7 %
|
|
6.7 %
|
|
7.3 %
|
|
5.7 %
|
Volume
|
0.4 %
|
|
1.7 %
|
|
0.7 %
|
|
2.6 %
|
The following table reflects changes in average yield and
volume, as a percentage of related business revenue by line of
business, for the three months and years ended December 31, 2023 and 2022:
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
Yield
|
|
Volume
|
|
Yield
|
|
Volume
|
|
Yield
|
|
Volume
|
|
Yield
|
|
Volume
|
Collection:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
7.4 %
|
|
(2.4) %
|
|
4.5 %
|
|
1.3 %
|
|
5.9 %
|
|
(0.5) %
|
|
4.3 %
|
|
0.1 %
|
Small-container
|
11.2 %
|
|
0.2 %
|
|
9.2 %
|
|
1.7 %
|
|
10.1 %
|
|
0.9 %
|
|
7.4 %
|
|
2.8 %
|
Large-container
|
7.7 %
|
|
(1.4) %
|
|
9.0 %
|
|
0.7 %
|
|
8.6 %
|
|
(0.9) %
|
|
8.4 %
|
|
2.3 %
|
Landfill:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Municipal solid
waste
|
6.3 %
|
|
3.7 %
|
|
3.9 %
|
|
0.3 %
|
|
6.0 %
|
|
1.5 %
|
|
3.5 %
|
|
1.3 %
|
Construction and
demolition waste
|
7.4 %
|
|
(2.1) %
|
|
2.0 %
|
|
— %
|
|
6.6 %
|
|
(2.7) %
|
|
2.1 %
|
|
5.0 %
|
Special
waste
|
— %
|
|
12.7 %
|
|
— %
|
|
10.9 %
|
|
— %
|
|
12.4 %
|
|
— %
|
|
10.9 %
|
COST OF OPERATIONS
The following table summarizes the major components of our cost
of operations for the three months and years ended December 31, 2023 and 2022 (in millions of
dollars and as a percentage of revenue):
|
Three Months Ended
December 31
|
|
Year Ended December
31
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Labor and related
benefits
|
$ 760.9
|
|
19.9 %
|
|
$
699.5
|
|
19.8 %
|
|
$
2,993.9
|
|
20.0 %
|
|
$
2,702.9
|
|
20.0 %
|
Transfer and disposal
costs
|
267.9
|
|
7.0
|
|
259.2
|
|
7.3
|
|
1056.3
|
|
7.1
|
|
992.9
|
|
7.3
|
Maintenance and
repairs
|
352.2
|
|
9.2
|
|
325.9
|
|
9.2
|
|
1,388.3
|
|
9.3
|
|
1,228.4
|
|
9.1
|
Transportation and
subcontract costs
|
289.5
|
|
7.6
|
|
301.4
|
|
8.5
|
|
1,171.0
|
|
7.8
|
|
1,086.5
|
|
8.0
|
Fuel
|
135.3
|
|
3.5
|
|
157.0
|
|
4.5
|
|
541.6
|
|
3.6
|
|
631.1
|
|
4.7
|
Disposal fees and
taxes
|
85.8
|
|
2.2
|
|
84.5
|
|
2.4
|
|
347.9
|
|
2.3
|
|
342.3
|
|
2.5
|
Landfill operating
costs
|
84.6
|
|
2.2
|
|
81.4
|
|
2.3
|
|
333.0
|
|
2.2
|
|
283.2
|
|
2.1
|
Risk
management
|
98.1
|
|
2.6
|
|
89.8
|
|
2.6
|
|
385.2
|
|
2.6
|
|
321.4
|
|
2.4
|
Other
|
190.0
|
|
4.9
|
|
182.6
|
|
5.2
|
|
725.0
|
|
4.9
|
|
616.0
|
|
4.6
|
Subtotal
|
2,264.3
|
|
59.1
|
|
2,181.3
|
|
61.8
|
|
8,942.2
|
|
59.8
|
|
8,204.7
|
|
60.7
|
US Ecology acquisition
integration and deal costs
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
0.3
|
|
—
|
Total cost of
operations
|
$
2,264.3
|
|
59.1 %
|
|
$
2,181.3
|
|
61.8 %
|
|
$
8,942.2
|
|
59.8 %
|
|
$
8,205.0
|
|
60.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
These cost categories may change from time to time and may not
be comparable to similarly titled categories used by other
companies. As such, you should take care when comparing our cost of
operations by cost component to that of other companies and of ours
for prior periods.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
The following table summarizes our selling, general and
administrative expenses for the three months and years ended
December 31, 2023 and 2022 (in
millions of dollars and as a percentage of revenue):
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Salaries
|
$
279.8
|
|
7.3 %
|
|
$
253.8
|
|
7.2 %
|
|
$ 1,050.4
|
|
7.0 %
|
|
$
937.9
|
|
7.0 %
|
Provision for doubtful
accounts
|
14.5
|
|
0.4
|
|
13.7
|
|
0.4
|
|
53.2
|
|
0.4
|
|
41.5
|
|
0.3
|
Other
|
128.0
|
|
3.3
|
|
115.9
|
|
3.3
|
|
471.6
|
|
3.1
|
|
397.9
|
|
2.9
|
Subtotal
|
422.3
|
|
11.0
|
|
383.4
|
|
10.9
|
|
1,575.2
|
|
10.5
|
|
1,377.3
|
|
10.2
|
US Ecology acquisition
integration and deal costs
|
9.1
|
|
0.2
|
|
11.9
|
|
0.3
|
|
33.5
|
|
0.2
|
|
77.0
|
|
0.6
|
Total selling, general
and administrative expenses
|
$
431.4
|
|
11.2 %
|
|
$
395.3
|
|
11.2 %
|
|
$ 1,608.7
|
|
10.7 %
|
|
$ 1,454.3
|
|
10.8 %
|
These cost categories may change from time to time and may not
be comparable to similarly titled categories used by other
companies. As such, you should take care when comparing our
selling, general and administrative expenses by cost component to
those of other companies and of ours for prior periods.
PERFORMANCE METRICS AND RECONCILIATIONS OF CERTAIN NON-GAAP
MEASURES
The following tables calculate EBITDA, EBITDA margin, adjusted
EBITDA, adjusted EBITDA margin, adjusted EBITDA margin by business
type, adjusted pre-tax income, adjusted tax impact, adjusted net
income - Republic, adjusted diluted earnings per share, and
adjusted free cash flow, which are not measures determined in
accordance with U.S. generally accepted accounting principles (U.S.
GAAP), for the three months and years ended December 31, 2023 and 2022. Our definitions of
the foregoing non-GAAP financial measures may not be comparable to
similarly titled measures presented by other companies.
Also presented below is adjusted EBITDA and adjusted EBITDA
margin by business type for the three months and years ended
December 31, 2023 and 2022.
Adjusted EBITDA and Adjusted EBITDA Margin
The following table calculates adjusted EBITDA and adjusted
EBITDA margin for the three months and years ended December 31, 2023 and 2022 (in millions of
dollars and as a percentage of revenue):
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net income attributable
to Republic Services, Inc. and net income margin
|
$ 439.6
|
|
11.5 %
|
|
$ 346.8
|
|
9.8 %
|
|
1,731.0
|
|
11.6 %
|
|
$
1,487.6
|
|
11.0 %
|
Net income attributable
to noncontrolling interests
|
0.1
|
|
|
|
0.2
|
|
|
|
0.4
|
|
|
|
—
|
|
|
Provision for income
taxes
|
43.2
|
|
|
|
26.4
|
|
|
|
460.1
|
|
|
|
343.9
|
|
|
Other (income) expense,
net
|
(4.3)
|
|
|
|
(4.1)
|
|
|
|
(7.5)
|
|
|
|
2.3
|
|
|
Interest
income
|
(1.5)
|
|
|
|
(1.4)
|
|
|
|
(6.5)
|
|
|
|
(3.3)
|
|
|
Interest
expense
|
129.4
|
|
|
|
112.9
|
|
|
|
508.2
|
|
|
|
395.6
|
|
|
Depreciation,
amortization and depletion
|
402.0
|
|
|
|
349.8
|
|
|
|
1,501.4
|
|
|
|
1,351.6
|
|
|
Accretion
|
24.7
|
|
|
|
22.7
|
|
|
|
97.9
|
|
|
|
89.6
|
|
|
EBITDA and EBITDA
margin
|
$
1,033.2
|
|
27.0 %
|
|
$ 853.3
|
|
24.2 %
|
|
$
4,285.0
|
|
28.6 %
|
|
$
3,667.3
|
|
27.1 %
|
(Gain) loss from
unconsolidated equity method investment
|
94.5
|
|
|
|
96.4
|
|
|
|
94.3
|
|
|
|
165.6
|
|
|
Loss on extinguishment
of debt and other related costs
|
—
|
|
|
|
—
|
|
|
|
0.2
|
|
|
|
—
|
|
|
Adjustment to
withdrawal liability for a multiemployer pension fund
|
4.5
|
|
|
|
(3.8)
|
|
|
|
4.5
|
|
|
|
(1.6)
|
|
|
Restructuring
charges
|
6.0
|
|
|
|
8.2
|
|
|
|
33.2
|
|
|
|
27.0
|
|
|
(Gain) loss on business
divestitures and impairments, net
|
(2.1)
|
|
|
|
(1.0)
|
|
|
|
(3.6)
|
|
|
|
(6.3)
|
|
|
US Ecology acquisition
integration and deal costs
|
9.1
|
|
|
|
11.9
|
|
|
|
33.5
|
|
|
|
77.3
|
|
|
Total
adjustments
|
$ 112.0
|
|
|
|
$ 111.7
|
|
|
|
$ 162.1
|
|
|
|
$ 262.0
|
|
|
Adjusted EBITDA and
adjusted EBITDA margin
|
$
1,145.2
|
|
29.9 %
|
|
$ 965.0
|
|
27.3 %
|
|
$
4,447.1
|
|
29.7 %
|
|
$
3,929.3
|
|
29.1 %
|
Adjusted EBITDA and Adjusted EBITDA Margin by Business
Type
The following table summarizes revenue, adjusted EBITDA and
adjusted EBITDA margin by business type for the three months and
years ended December 31, 2023 (in
millions of dollars and adjusted EBITDA margin as a percentage of
revenue):
|
|
Three Months Ended
December 31, 2023
|
|
|
Recycling &
Waste
|
|
Environmental
Solutions
|
|
Total
|
Revenue
|
|
$
3,418.2
|
|
$
413.4
|
|
$ 3,831.6
|
Adjusted
EBITDA(a)
|
|
$
1,063.8
|
|
$
81.4
|
|
$ 1,145.2
|
Adjusted EBITDA
Margin
|
|
31.1 %
|
|
19.7 %
|
|
29.9 %
|
|
(a) Certain corporate
expenses, including selling, general and administrative expenses,
and National Accounts revenue are allocated to the two business
types.
|
|
|
|
|
Year Ended December 31,
2023
|
|
|
Recycling &
Waste
|
|
Environmental
Solutions
|
|
Total
|
Revenue
|
|
$
13,339.6
|
|
$
1,624.9
|
|
$
14,964.5
|
Adjusted
EBITDA(a)
|
|
$
4,098.7
|
|
$
348.4
|
|
$ 4,447.1
|
Adjusted EBITDA
Margin
|
|
30.7 %
|
|
21.4 %
|
|
29.7 %
|
|
(a) Certain corporate
expenses, including selling, general and administrative expenses,
and National Accounts revenue are allocated to the two business
types.
|
The amounts shown for Recycling & Waste represent the sum of
our Group 1 and Group 2 reportable segments, and Environmental
Solutions represents our Group 3 reportable segment.
Adjusted Earnings Per Share
The following table calculates adjusted pre-tax income, adjusted
tax impact, adjusted net income - Republic, and adjusted diluted
earnings per share for the three months and years ended
December 31, 2023 and 2022:
|
|
Three Months Ended
December 31, 2023
|
|
Three Months Ended
December 31, 2022
|
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
Net
|
|
Earnings
|
|
|
|
|
|
Net
|
|
Earnings
|
|
|
Pre-tax
|
|
Tax
|
|
Income -
|
|
per
|
|
Pre-tax
|
|
Tax
|
|
Income -
|
|
per
|
|
|
Income
|
|
Impact(1)
|
|
Republic
|
|
Share
|
|
Income
|
|
Impact(1)
|
|
Republic
|
|
Share
|
As reported
|
|
$
482.9
|
|
43.3
|
|
$
439.6
|
|
$ 1.39
|
|
$
373.4
|
|
26.6
|
|
$
346.8
|
|
$ 1.09
|
Restructuring
charges
|
|
6.0
|
|
1.6
|
|
4.4
|
|
0.01
|
|
8.2
|
|
2.2
|
|
6.0
|
|
0.02
|
Gain on business
divestitures and impairments,
net
(2)
|
|
(2.1)
|
|
5.5
|
|
(7.6)
|
|
(0.02)
|
|
(1.0)
|
|
(0.3)
|
|
(0.7)
|
|
—
|
Adjustment to
withdrawal liability for a multiemployer pension fund
|
|
4.5
|
|
1.2
|
|
3.3
|
|
0.01
|
|
(3.8)
|
|
(1.0)
|
|
(2.8)
|
|
(0.01)
|
US Ecology acquisition
integration and deal costs
|
|
9.1
|
|
2.4
|
|
6.7
|
|
0.02
|
|
11.9
|
|
3.1
|
|
8.8
|
|
0.03
|
Total
adjustments
|
|
17.5
|
|
10.7
|
|
6.8
|
|
0.02
|
|
15.3
|
|
4.0
|
|
11.3
|
|
0.04
|
As adjusted
|
|
$
500.4
|
|
$ 54.0
|
|
$
446.4
|
|
$ 1.41
|
|
$
388.7
|
|
$ 30.6
|
|
$
358.1
|
|
$ 1.13
|
(1) The income tax effect related to our adjustments
includes both the current and deferred income tax impact and is
individually calculated based on the statutory rates applicable to
each adjustment.
(2) The aggregate impact to adjusted diluted earnings per
share totals to less than $0.01 for
the three months ended December 31,
2022.
|
|
Year Ended December 31,
2023
|
|
Year Ended December 31,
2022
|
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
Net
|
|
Earnings
|
|
|
|
|
|
Net
|
|
Earnings
|
|
|
Pre-tax
|
|
Tax
|
|
Income -
|
|
per
|
|
Pre-tax
|
|
Tax
|
|
Income -
|
|
per
|
|
|
Income
|
|
Impact(1)
|
|
Republic
|
|
Share
|
|
Income
|
|
Impact(1)
|
|
Republic
|
|
Share
|
As reported
|
|
$
2,191.5
|
|
$ 460.5
|
|
$ 1,731.0
|
|
$ 5.47
|
|
$
1,831.5
|
|
$ 343.9
|
|
$ 1,487.6
|
|
$ 4.69
|
Loss on extinguishment
of debt and other related costs (2)
|
|
0.2
|
|
—
|
|
0.2
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Restructuring
charges
|
|
33.2
|
|
8.7
|
|
24.5
|
|
0.08
|
|
27.0
|
|
7.1
|
|
19.9
|
|
0.06
|
Gain on business
divestitures and impairments, net
|
|
(3.6)
|
|
5.1
|
|
(8.7)
|
|
(0.03)
|
|
(6.3)
|
|
(2.5)
|
|
(3.8)
|
|
(0.01)
|
Adjustment to
withdrawal liability for a multiemployer pension fund
(3)
|
|
4.5
|
|
1.2
|
|
3.3
|
|
0.01
|
|
(1.6)
|
|
(0.4)
|
|
(1.2)
|
|
—
|
US Ecology acquisition
integration and deal costs
|
|
33.5
|
|
8.7
|
|
24.8
|
|
0.08
|
|
77.3
|
|
17.0
|
|
60.3
|
|
0.19
|
Total
adjustments
|
|
67.8
|
|
23.7
|
|
44.1
|
|
0.14
|
|
96.4
|
|
21.2
|
|
75.2
|
|
0.24
|
As adjusted
|
|
$
2,259.3
|
|
$ 484.2
|
|
$ 1,775.1
|
|
$ 5.61
|
|
$
1,927.9
|
|
$ 365.1
|
|
$ 1,562.8
|
|
$ 4.93
|
(1) The income tax effect related to our adjustments
includes both the current and deferred income tax impact and is
individually calculated based on the statutory rates applicable to
each adjustment.
(2) The aggregate impact to adjusted diluted earnings per
share totals to less than $0.01 for
the year ended December 31,
2023.
(3) The aggregate impact to adjusted diluted earnings per
share totals to less than $0.01 for
the year ended December 31,
2022.
We believe that presenting EBITDA and EBITDA margin is useful to
investors because they provide important information concerning our
operating performance exclusive of certain non-cash and other
costs. EBITDA and EBITDA margin demonstrate our ability to execute
our financial strategy, which includes reinvesting in existing
capital assets to ensure a high level of customer service,
investing in capital assets to facilitate growth in our customer
base and services provided, maintaining our investment grade credit
ratings and minimizing debt, paying cash dividends, repurchasing
our common stock, and maintaining and improving our market position
through business optimization. Although depreciation, depletion,
amortization and accretion are considered operating costs in
accordance with U.S. GAAP, they represent the allocation of
non-cash costs generally associated with long-lived assets acquired
or constructed in prior years.
We believe that presenting adjusted EBITDA and adjusted EBITDA
margin, adjusted EBITDA margin by business type, adjusted pre-tax
income, adjusted tax impact, adjusted net income - Republic, and
adjusted diluted earnings per share provide an understanding of
operational activities before the financial impact of certain
items. We use these measures, and believe investors will find them
helpful, in understanding the ongoing performance of our operations
separate from items that have a disproportionate impact on our
results for a particular period. We have incurred comparable
charges, costs and recoveries in prior periods, and similar types
of adjustments can reasonably be expected to be recorded in future
periods.
Restructuring charges. During the three months and year
ended December 31, 2023 we incurred
$6.0 million and $33.2 million, respectively, of restructuring
charges primarily related to the redesign of our asset management,
and customer and order management software systems, as well as
costs associated with the early termination of certain leases.
During the three months and year ended December 31, 2022, we incurred $8.2 million and $27.0
million, respectively, of restructuring charges primarily
related to the redesign of our general ledger, budgeting, and
procurement enterprise resource planning systems, which was
completed with the systems being placed into production by the end
of 2022.
Gain on business divestitures and impairments, net.
During the year ended December 31,
2023 and 2022, we recorded a net gain on business
divestitures and impairments of $3.6
million and $6.3 million,
respectively. During the three months ended December 31, 2023 and 2022, we recorded a net
gain on business divestitures and impairments of $2.1 million and $1.0
million, respectively.
Adjustment to withdrawal liability for multiemployer pension
funds. During the three months and year ended December 31, 2023 we recorded $4.5 million of withdrawal costs from a
multiemployer pension plan. During the year ended December 31, 2022, we recorded $1.6 million of withdrawal costs from a
multiemployer pension plan.
US Ecology acquisition integration and deal costs. During
the three months and year ended December 31,
2023, we incurred $9.1 million
and $33.5 million, respectively, and
during the three months and year ended December 31, 2022, we incurred $11.9 million and $77.3
million, respectively, of acquisition integration and deal
costs in connection with the acquisition of US Ecology. The
acquisition closed on May 2, 2022. The 2023 costs primarily
related to the integration of certain software systems as well as
rebranding the business, and the 2022 costs included certain costs
to close the acquisition and integrate the US Ecology business.
Loss on extinguishment of debt and other related costs.
During the year ended December 31,
2023, we incurred a loss on the early extinguishment of debt
of $0.2 million related to the early
repayment of a portion of our term loan facility. We incurred
non-cash charges related to the proportional share of unamortized
deferred issuance costs.
Adjusted Free Cash Flow
The following table calculates our adjusted free cash flow,
which is not a measure determined in accordance with U.S. GAAP, for
the years ended December 31, 2023 and
2022:
|
|
Year Ended December
31,
|
|
|
2023
|
|
2022
|
Cash provided by
operating activities
|
|
$
3,617.8
|
|
$
3,190.0
|
Property and equipment
received
|
|
(1,717.5)
|
|
(1,552.5)
|
Proceeds from sales of
property and equipment
|
|
29.2
|
|
32.8
|
Cash paid related to
adjustments to withdrawal liabilities for a multiemployer pension
fund, net of tax
|
|
0.3
|
|
2.2
|
Restructuring payments,
net of tax
|
|
29.1
|
|
14.6
|
Cash tax benefit for
debt extinguishment and other related costs
|
|
(0.1)
|
|
—
|
Divestiture related tax
payments
|
|
0.9
|
|
2.5
|
US Ecology acquisition
integration and deal costs, net of tax
|
|
25.4
|
|
52.8
|
Adjusted free cash
flow
|
|
$
1,985.1
|
|
$
1,742.4
|
We believe that presenting adjusted free cash flow provides
useful information regarding our recurring cash provided by
operating activities after certain expenditures or recoveries. It
also demonstrates our ability to execute our financial strategy and
is a key metric we use to determine compensation. The presentation
of adjusted free cash flow has material limitations. Adjusted free
cash flow does not represent our cash flow available for
discretionary payments because it excludes certain payments that
are required or to which we have committed, such as debt service
requirements and dividend payments.
Purchases of property and equipment as reflected on our
consolidated statements of cash flows represent amounts paid during
the period for such expenditures. A reconciliation of property and
equipment expenditures reflected on our consolidated statements of
cash flows to property and equipment received during the period
follows for the years ended December 31,
2023 and 2022:
|
Year Ended December
31,
|
|
2023
|
|
2022
|
Purchases of property
and equipment per the unaudited consolidated statements of cash
flows
|
$
1,631.1
|
|
$
1,454.0
|
Adjustments for
property and equipment received during the current period but paid
for in a future period, net
|
86.4
|
|
98.5
|
Property and equipment
received during the period
|
$
1,717.5
|
|
$
1,552.5
|
The adjustments noted above do not affect our net change in
cash, cash equivalents, restricted cash and restricted cash
equivalents as reflected in our consolidated statements of cash
flows.
ACCOUNTS RECEIVABLE
As of December 31, 2023 and
December 31, 2022, accounts
receivable were $1,768.4 million and
$1,677.2 million, net of allowance
for doubtful accounts of $83.2
million and $51.9 million,
respectively, resulting in days sales outstanding of 42.0, or 30.9
days net of deferred revenue, compared to 43.3, or 31.8 days net of
deferred revenue, respectively.
CASH DIVIDENDS
In October 2023, we paid a cash
dividend of $168.5 million to
shareholders of record as of October 2,
2023. As of December 31, 2023,
we recorded a quarterly dividend payable of $168.3 million to shareholders of record at
the close of business on January 2, 2024, which was paid on
January 16, 2024.
SHARE REPURCHASE PROGRAM
During the three months ended December
31, 2023, we repurchased 0.4 million shares of our stock for
$60.6 million at a weighted average
cost per share of $142.60. As of
December 31, 2023, the remaining
authorized purchase capacity under our October 2023 repurchase program was $3.0 billion.
RECONCILIATION OF 2024 FINANCIAL GUIDANCE
Adjusted EBITDA
The following is a summary of our anticipated adjusted EBITDA
for the year ending December 31,
2024, which is not a measure determined in accordance with
U.S. GAAP:
|
(Anticipated)
Year Ending
December 31, 2024
|
Net income attributable
to Republic Services, Inc.
|
$ 1,825 to
1,865
|
Provision for income
taxes
|
455 to 465
|
Interest expense,
net
|
545
|
Depreciation,
amortization, depletion and accretion
|
1,775
|
Loss from
unconsolidated equity method investments
|
190
|
Restructuring
charges
|
35
|
Adjusted
EBITDA
|
$ 4,825 to
4,875
|
We believe that presenting adjusted EBITDA provides an
understanding of operational activities before the financial impact
of certain items. We use this measure, and believe investors will
find it helpful, in understanding the ongoing performance of our
operations separate from items that have a disproportionate impact
on our results for a particular period. We have incurred comparable
charges, costs and recoveries in prior periods, and similar types
of adjustments can reasonably be expected to be recorded in future
periods.
Adjusted Diluted Earnings per Share
The following is a summary of anticipated adjusted diluted
earnings per share for the year ending December 31, 2024, which is not a measure
determined in accordance with U.S. GAAP:
|
(Anticipated)
Year Ending
December 31, 2024
|
Diluted earnings per
share
|
$
5.86 to 5.92
|
Restructuring
charges
|
0.08
|
Adjusted diluted
earnings per share
|
$
5.94 to 6.00
|
We believe that presenting adjusted diluted earnings per share
provides an understanding of operational activities before the
financial impact of certain items. We use this measure, and believe
investors will find it helpful, in understanding the ongoing
performance of our operations separate from items that have a
disproportionate impact on our results for a particular period. We
have incurred comparable charges, costs and recoveries in prior
periods, and similar types of adjustments can reasonably be
expected to be recorded in future periods. Our definition of
adjusted diluted earnings per share may not be comparable to
similarly titled measures presented by other companies.
Adjusted Free Cash Flow
Our anticipated adjusted free cash flow for the year ending
December 31, 2024, which is not a measure determined in
accordance with U.S. GAAP, is calculated as follows:
|
(Anticipated)
Year Ending
December 31, 2024
|
Cash provided by
operating activities
|
$ 3,835 to 3,925
|
Property and equipment
received
|
(1,780 to
1,820)
|
Proceeds from sales of
property and equipment
|
20
|
Restructuring payments,
net of tax
|
25
|
Adjusted free cash
flow
|
$ 2,100 to 2,150
|
We believe that presenting adjusted free cash flow provides
useful information regarding our recurring cash provided by
operating activities after certain expenditures or recoveries. It
also demonstrates our ability to execute our financial strategy and
is a key metric we use to determine compensation. The presentation
of adjusted free cash flow has material limitations. Adjusted free
cash flow does not represent our cash flow available for
discretionary payments because it excludes certain payments that
are required or to which we have committed, such as debt service
requirements and dividend payments. Our definition of adjusted free
cash flow may not be comparable to similarly titled measures
presented by other companies.
Our financial guidance is based on current economic
conditions.
INFORMATION REGARDING FORWARD-LOOKING
STATEMENTS
This press release contains certain forward-looking information
about us that is intended to be covered by the safe harbor for
"forward-looking statements" provided by the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are
statements that are not historical facts. Words such as "guidance,"
"expect," "will," "may," "anticipate," "plan," "estimate,"
"project," "intend," "should," "can," "likely," "could," "outlook"
and similar expressions are intended to identify forward-looking
statements. These statements include information about our plans,
strategies and prospects. Forward-looking statements are not
guarantees of performance. These statements are based upon the
current beliefs and expectations of our management and are subject
to risk and uncertainties that could cause actual results to differ
materially from those expressed in, or implied or projected by, the
forward-looking information and statements. Although we believe
that the expectations reflected in the forward-looking statements
are reasonable, we cannot assure you that the expectations will
prove to be correct. Among the factors that could cause actual
results to differ materially from the expectations expressed in the
forward-looking statements are the impacts of the overall global
economy and increasing interest rates, our ability to effectively
integrate and manage companies we acquire, including US Ecology,
and to realize the anticipated benefits of any such acquisitions,
the amount of the financial contribution of our sustainability
initiatives, acts of war, riots or terrorism, and the impact of
these acts on economic, financial and social conditions in
the United States, as well as our
dependence on large, long-term collection, transfer and disposal
contracts. More information on factors that could cause actual
results or events to differ materially from those anticipated is
included from time to time in our reports filed with the Securities
and Exchange Commission, including our Annual Report on Form 10-K
for the year ended December 31, 2023,
particularly under Part I, Item 1A – Risk Factors. Additionally,
new risk factors emerge from time to time and it is not possible
for us to predict all such risk factors, or to assess the impact
such risk factors might have on our business. We undertake no
obligation to update publicly any forward-looking statements
whether as a result of new information, future events or otherwise,
except as required by law.
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SOURCE Republic Services, Inc.