Republic Services, Inc. Reports Second Quarter 2024 Results
- Second Quarter Total Revenue Growth of 8.6 Percent
- Reported Earnings Per Share of $1.62 and Adjusted Earnings Per Share of $1.61
- Expanded Both Net Income Margin and Adjusted EBITDA Margin 110 Basis Points
- Generated Year-to-Date Cash Flow from Operations of $1.91 Billion and Adjusted Free Cash Flow of $1.15 Billion
- Raised 2024 Full-Year Financial Guidance for Earnings and Cash Flow
- Increased Quarterly Dividend by Approximately 8 Percent
PHOENIX, July 24, 2024 /PRNewswire/ -- Republic Services, Inc. (NYSE: RSG) today reported net income of $511.5 million, or $1.62 per diluted share, for the three months ended June 30, 2024, versus $427.4 million, or $1.35 per diluted share, for the comparable 2023 period. Excluding certain expenses and other items, on an adjusted basis, net income for the three months ended June 30, 2024, was $508.9 million, or $1.61 per diluted share, versus $446.7 million, or $1.41 per diluted share, for the comparable 2023 period.
"We continue to prioritize our differentiating capabilities – Customer Zeal, Digital and Sustainability – to help our customers achieve their operational and sustainability goals, and drive significant value for our stakeholders," said Jon Vander Ark, president and chief executive officer. "During the second quarter, we delivered double-digit growth in EBITDA and EPS, and expanded EBITDA margin by 110 basis points. Pricing in excess of cost inflation and solid operational execution underpinned strong results across the business. As a result of our performance and outlook for the remainder of the year, we are raising our full-year financial guidance."
Second-Quarter and Year-to-Date 2024 Highlights:
- Second quarter total revenue growth of 8.6 percent includes 5.6 percent organic growth and 3.0 percent growth from acquisitions.
- Second quarter core price on total revenue increased revenue by 6.8 percent. Core price on related business revenue increased revenue by 8.1 percent, which consisted of 9.8 percent in the open market and 5.4 percent in the restricted portion of the business.
- Second quarter revenue growth from average yield on total revenue was 5.5 percent, and volume decreased revenue by 0.8 percent. Revenue growth from average yield on related business revenue was 6.6 percent, and volume decreased related business revenue by 1.0 percent.
- Second quarter net income was $511.5 million, or a margin of 12.6 percent.
- Second quarter EPS was $1.62 per share, an increase of 20.0 percent over the prior year.
- Second quarter adjusted EPS, a non-GAAP measure, was $1.61 per share, an increase of 14.2 percent over the prior year.
- Adjusted EBITDA, a non-GAAP measure, was $1,257.8 million, and adjusted EBITDA margin, a non-GAAP measure, was 31.1 percent of revenue, an increase of 110 basis points over the prior year.
- Year-to-date cash invested in acquisitions, including an investment in a post-collection business, was $67.6 million.
- Year-to-date cash returned to shareholders was $504.4 million, which included $167.6 million of share repurchases and $336.8 million of dividends paid.
- The Company's average recycled commodity price per ton sold at our recycling centers during the second quarter was $173. This represents an increase of $54 per ton over the prior year.
- The Company completed and commenced operations on one renewable natural gas project during the quarter.
Updated Full-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.
The Company provided additional details as follows:
- Revenue: Republic expects revenue to be in the range of $16.075 billion to $16.125 billion.
- Adjusted EBITDA: Republic expects adjusted EBITDA to be in the range of $4.900 billion to $4.925 billion.
- Adjusted Diluted Earnings per Share: The Company expects adjusted diluted earnings per share to be in the range of $6.15 to $6.20.
- Adjusted Free Cash Flow: Republic expects adjusted free cash flow to be in the range of $2.150 billion to $2.170 billion.
Company Increases Quarterly Dividend
Republic continues to increase cash returns to shareholders, and announced today that its Board of Directors approved a 4.5-cent increase in the quarterly dividend. The quarterly dividend of $0.58 per share for shareholders of record on October 2, 2024, will be paid on October 15, 2024.
Presentation of Certain Performance Metrics and Non-GAAP Measures
Adjusted diluted earnings per share, adjusted net income - Republic, 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) | |||
June 30, | December 31, | ||
2024 | 2023 | ||
(Unaudited) | |||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 490.6 | $ 140.0 | |
Accounts receivable, less allowance for doubtful accounts and other of $82.9 and $83.2, respectively | 1,817.8 | 1,768.4 | |
Prepaid expenses and other current assets | 351.3 | 472.6 | |
Total current assets | 2,659.7 | 2,381.0 | |
Restricted cash and marketable securities | 178.0 | 163.6 | |
Property and equipment, net | 11,446.5 | 11,350.9 | |
Goodwill | 15,864.9 | 15,834.5 | |
Other intangible assets, net | 463.4 | 496.2 | |
Other assets | 1,321.6 | 1,183.9 | |
Total assets | $ 31,934.1 | $ 31,410.1 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Current liabilities: | |||
Accounts payable | $ 1,285.5 | $ 1,411.5 | |
Notes payable and current maturities of long-term debt | 1,432.9 | 932.3 | |
Deferred revenue | 472.5 | 467.3 | |
Accrued landfill and environmental costs, current portion | 140.5 | 141.6 | |
Accrued interest | 103.1 | 104.1 | |
Other accrued liabilities | 1,099.1 | 1,171.5 | |
Total current liabilities | 4,533.6 | 4,228.3 | |
Long-term debt, net of current maturities | 11,526.8 | 11,887.1 | |
Accrued landfill and environmental costs, net of current portion | 2,332.2 | 2,281.0 | |
Deferred income taxes and other long-term tax liabilities, net | 1,569.2 | 1,526.8 | |
Insurance reserves, net of current portion | 365.8 | 348.8 | |
Other long-term liabilities | 600.2 | 594.6 | |
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; 321.2 and 320.7 issued including shares | 3.2 | 3.2 | |
Additional paid-in capital | 2,932.2 | 2,900.8 | |
Retained earnings | 9,060.7 | 8,433.9 | |
Treasury stock, at cost; 7.2 and 6.1 shares, respectively | (981.9) | (783.5) | |
Accumulated other comprehensive loss, net of tax | (9.1) | (12.1) | |
Total Republic Services, Inc. stockholders' equity | 11,005.1 | 10,542.3 | |
Non-controlling interests in consolidated subsidiary | 1.2 | 1.2 | |
Total stockholders' equity | 11,006.3 | 10,543.5 | |
Total liabilities and stockholders' equity | $ 31,934.1 | $ 31,410.1 | |
REPUBLIC SERVICES, INC. | |||||||
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME | |||||||
(in millions, except per share data) | |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Revenue | $ 4,048.0 | $ 3,725.9 | $ 7,909.8 | $ 7,307.0 | |||
Expenses: | |||||||
Cost of operations | 2,382.6 | 2,224.4 | 4,665.8 | 4,393.8 | |||
Depreciation, amortization and depletion | 413.0 | 358.3 | 812.2 | 717.0 | |||
Accretion | 26.7 | 24.5 | 53.4 | 48.6 | |||
Selling, general and administrative | 407.6 | 396.0 | 821.7 | 775.2 | |||
Gain on business divestitures and impairments, net | (1.4) | — | (1.4) | — | |||
Restructuring charges | 5.7 | 15.5 | 11.5 | 21.0 | |||
Operating income | 813.8 | 707.2 | 1,546.6 | 1,351.4 | |||
Interest expense | (128.3) | (124.4) | (267.6) | (251.1) | |||
Loss on extinguishment of debt | — | — | — | (0.2) | |||
Loss from unconsolidated equity method investments | (33.8) | (3.6) | (42.5) | (2.7) | |||
Interest income | 1.6 | 1.6 | 3.1 | 3.0 | |||
Other income (loss), net | 0.7 | (0.6) | 13.3 | 1.9 | |||
Income before income taxes | 654.0 | 580.2 | 1,252.9 | 1,102.3 | |||
Provision for income taxes | 142.1 | 152.6 | 287.3 | 290.9 | |||
Net income | 511.9 | 427.6 | 965.6 | 811.4 | |||
Net loss attributable to non-controlling interests in consolidated | (0.4) | (0.2) | (0.3) | (0.2) | |||
Net income attributable to Republic Services, Inc. | $ 511.5 | $ 427.4 | $ 965.3 | $ 811.2 | |||
Basic earnings per share attributable to Republic Services, Inc. | |||||||
Basic earnings per share | $ 1.62 | $ 1.35 | $ 3.06 | $ 2.56 | |||
Weighted average common shares outstanding | 314.9 | 316.8 | 315.1 | 316.8 | |||
Diluted earnings per share attributable to Republic Services, Inc. | |||||||
Diluted earnings per share | $ 1.62 | $ 1.35 | $ 3.06 | $ 2.56 | |||
Weighted average common and common equivalent shares | 315.2 | 317.3 | 315.5 | 317.2 | |||
Cash dividends per common share | $ 0.535 | $ 0.495 | $ 1.070 | $ 0.990 | |||
REPUBLIC SERVICES, INC. | |||
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
(in millions) | |||
Six Months Ended June 30, | |||
2024 | 2023 | ||
Cash provided by operating activities: | |||
Net income | $ 965.6 | $ 811.4 | |
Adjustments to reconcile net income to cash provided by operating activities: | |||
Depreciation, amortization, depletion and accretion | 865.6 | 765.6 | |
Non-cash interest expense | 34.9 | 45.1 | |
Stock-based compensation | 21.8 | 21.4 | |
Deferred tax provision | 47.5 | 33.4 | |
Provision for doubtful accounts, net of adjustments | 19.9 | 19.7 | |
Loss on extinguishment of debt | — | 0.2 | |
Gain on disposition of assets and asset impairments, net | (0.3) | (4.7) | |
Loss (gain) from unconsolidated equity method investments | 42.5 | 2.7 | |
Other non-cash items | (0.4) | (1.5) | |
Change in assets and liabilities, net of effects from business acquisitions and divestitures: | |||
Accounts receivable | (69.4) | (52.0) | |
Prepaid expenses and other assets | 36.2 | 138.5 | |
Accounts payable | 19.5 | 35.1 | |
Capping, closure and post-closure expenditures | (22.2) | (24.5) | |
Remediation expenditures | (26.7) | (21.2) | |
Other liabilities | (47.3) |
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