Casella Waste Systems (CWST) Q4 2000 earnings summary

Executive summary

• FY00 results reflected rapid acquisition-led expansion, led by the December 1999 KTI acquisition; revenue reached $337.3M and net income $11.1M.

• Management emphasized using an integrated collection, transfer, disposal, and recycling platform to build local leadership and pursue long-term growth, particularly in eastern Massachusetts.

• Cash flow remained the stated performance yardstick; adjusted EBITDA was $83.0M in FY00.

Financial highlights

• FY00 revenue $337.347M, up 84.7% YoY; $138.7M of the increase came from acquisitions and $16.0M from internal volume and pricing, including stronger recyclable commodity prices.

• Operating income $42.800M vs. $19.391M in FY99; net income $11.050M vs. $6.615M; basic EPS $0.59 vs. $0.44.

• Adjusted EBITDA $83.011M vs. $45.116M in FY99; adjusted EBITDA margin 24.6% vs. 24.7%.

• Operating cash flow was $41.585M; cash and cash equivalents were $8.864M at April 30, 2000.

Outlook and guidance

• Management cited growth opportunities in eastern Massachusetts through fuller use of existing waste-management infrastructure and targeted market development.

• Expected $55.8M preferred-stock financing was intended to reduce debt and support the strategic plan; financing was anticipated to close in August 2000.

• Internal cash, available credit, and planned preferred financing were expected to meet working-capital needs for the next 12 months.