GFL Environmental (GFL) Q3 2024 earnings summary

Executive summary

• Achieved record adjusted EBITDA margin of 31.1% in Q3 2024, up 300 basis points year-over-year, and lowest net leverage in company history at 4.05x.

• Revenue reached $2.015 billion in Q3, with 11.3% growth in solid waste (excluding divestitures) and strong price-led performance.

• Solid Waste price increases and sequential volume improvements exceeded expectations; Environmental Services sale process on track with expected net proceeds of at least $6 billion.

• Leadership transition: Billy Soffera to become COO effective January 1, 2025, succeeding Greg Yorston.

Financial highlights

• Q3 2024 adjusted EBITDA rose 18.0% to $625.9 million; adjusted EBITDA margin reached a record 31.1%, up 300 basis points year-over-year.

• Adjusted Free Cash Flow and Adjusted Net Income were $225 million and $126 million, respectively, in line with expectations.

• Net leverage ended at 4.05x, the lowest in company history.

• Year-to-date revenue reached $5,876.1 million, up 9.0% excluding divestitures; adjusted EBITDA for nine months was $1,672.7 million, up 14.3% excluding divestitures.

• Net loss for the nine months ended September 30, 2024 was $538.2 million, including a non-cash loss from U.S. asset divestitures.

Outlook and guidance

• Fiscal 2024 revenue expected at $7.82–$7.85 billion, with adjusted EBITDA margin guidance raised to 28.6%.

• Q4 revenue expected at $1.94–$1.97 billion, with over 29% adjusted EBITDA margin.

• Q4 Adjusted Free Cash Flow and Adjusted Net Income expected at ~$350 million and $75–$80 million, respectively.

• 2025 outlook includes mid-single-digit organic revenue growth, double-digit adjusted EBITDA growth, and >100 basis points margin expansion.

• On track to meet 2024 capital allocation targets, including ~$900 million for M&A and growth investments.