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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Casella Waste Systems Inc | NASDAQ:CWST | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 105.26 | 104.61 | 126.00 | 0 | 09:05:30 |
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|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
Delaware
|
03-0338873
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
|
25 Greens Hill Lane, Rutland, Vermont
|
05701
|
(Address of principal executive offices)
|
(Zip Code)
|
|
Large accelerated filer
|
¨
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Accelerated filer
|
ý
|
Non-accelerated filer
|
¨
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
¨
|
|
|
Emerging growth company
|
¨
|
Class A common stock, $0.01 par value per share:
|
41,055,465
|
|
|
Class B common stock, $0.01 par value per share:
|
988,200
|
|
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
|
(Unaudited)
|
|
|
||||
ASSETS
|
|||||||
CURRENT ASSETS:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
2,303
|
|
|
$
|
2,544
|
|
Accounts receivable - trade, net of allowance for doubtful accounts of $694 and $1,069, respectively
|
65,083
|
|
|
61,196
|
|
||
Refundable income taxes
|
719
|
|
|
654
|
|
||
Prepaid expenses
|
9,474
|
|
|
7,989
|
|
||
Inventory
|
5,941
|
|
|
4,915
|
|
||
Other current assets
|
1,011
|
|
|
1,290
|
|
||
Total current assets
|
84,531
|
|
|
78,588
|
|
||
Property, plant and equipment, net of accumulated depreciation and amortization of $798,612 and $837,122, respectively
|
351,502
|
|
|
398,466
|
|
||
Goodwill
|
122,085
|
|
|
119,899
|
|
||
Intangible assets, net
|
7,996
|
|
|
7,696
|
|
||
Restricted assets
|
1,084
|
|
|
1,002
|
|
||
Cost method investments
|
12,333
|
|
|
12,333
|
|
||
Other non-current assets
|
12,889
|
|
|
13,528
|
|
||
Total assets
|
$
|
592,420
|
|
|
$
|
631,512
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Revenues
|
$
|
160,269
|
|
|
$
|
151,133
|
|
|
$
|
448,087
|
|
|
$
|
421,236
|
|
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of operations
|
103,897
|
|
|
98,803
|
|
|
300,961
|
|
|
284,409
|
|
||||
General and administration
|
20,750
|
|
|
18,777
|
|
|
58,388
|
|
|
55,450
|
|
||||
Depreciation and amortization
|
16,591
|
|
|
16,175
|
|
|
46,307
|
|
|
46,430
|
|
||||
Southbridge Landfill closure charge
|
754
|
|
|
—
|
|
|
64,868
|
|
|
—
|
|
||||
|
141,992
|
|
|
133,755
|
|
|
470,524
|
|
|
386,289
|
|
||||
Operating income (loss)
|
18,277
|
|
|
17,378
|
|
|
(22,437
|
)
|
|
34,947
|
|
||||
Other expense (income):
|
|
|
|
|
|
|
|
||||||||
Interest income
|
(58
|
)
|
|
(64
|
)
|
|
(180
|
)
|
|
(229
|
)
|
||||
Interest expense
|
6,268
|
|
|
9,643
|
|
|
19,052
|
|
|
29,677
|
|
||||
Loss on debt extinguishment
|
—
|
|
|
191
|
|
|
517
|
|
|
736
|
|
||||
Other income
|
(164
|
)
|
|
(192
|
)
|
|
(567
|
)
|
|
(697
|
)
|
||||
Other expense, net
|
6,046
|
|
|
9,578
|
|
|
18,822
|
|
|
29,487
|
|
||||
Income (loss) before income taxes
|
12,231
|
|
|
7,800
|
|
|
(41,259
|
)
|
|
5,460
|
|
||||
Provision for income taxes
|
151
|
|
|
263
|
|
|
561
|
|
|
344
|
|
||||
Net income (loss)
|
12,080
|
|
|
7,537
|
|
|
(41,820
|
)
|
|
5,116
|
|
||||
Less: Net loss attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||
Net income (loss) attributable to common stockholders
|
$
|
12,080
|
|
|
$
|
7,537
|
|
|
$
|
(41,820
|
)
|
|
$
|
5,125
|
|
Basic earnings per share attributable to common stockholders:
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding
|
41,951
|
|
|
41,377
|
|
|
41,783
|
|
|
41,169
|
|
||||
Basic earnings per common share
|
$
|
0.29
|
|
|
$
|
0.18
|
|
|
$
|
(1.00
|
)
|
|
$
|
0.12
|
|
Diluted earnings per share attributable to common stockholders:
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding
|
43,295
|
|
|
42,287
|
|
|
41,783
|
|
|
41,896
|
|
||||
Diluted earnings per common share
|
$
|
0.28
|
|
|
$
|
0.18
|
|
|
$
|
(1.00
|
)
|
|
$
|
0.12
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net income (loss)
|
$
|
12,080
|
|
|
$
|
7,537
|
|
|
$
|
(41,820
|
)
|
|
$
|
5,116
|
|
Other comprehensive income (loss), before tax:
|
|
|
|
|
|
|
|
||||||||
Hedging activity:
|
|
|
|
|
|
|
|
||||||||
Interest rate swap settlements
|
(110
|
)
|
|
—
|
|
|
(304
|
)
|
|
—
|
|
||||
Interest rate swap amounts reclassified into interest expense
|
112
|
|
|
—
|
|
|
320
|
|
|
—
|
|
||||
Unrealized gain (loss) resulting from changes in fair value of derivative instruments
|
15
|
|
|
—
|
|
|
(263
|
)
|
|
—
|
|
||||
Unrealized gain (loss) resulting from changes in fair value of marketable securities
|
18
|
|
|
(10
|
)
|
|
64
|
|
|
(50
|
)
|
||||
Other comprehensive income (loss), before tax
|
35
|
|
|
(10
|
)
|
|
(183
|
)
|
|
(50
|
)
|
||||
Income tax expense related to items of other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Other comprehensive income (loss), net of tax
|
35
|
|
|
(10
|
)
|
|
(183
|
)
|
|
(50
|
)
|
||||
Comprehensive income (loss)
|
12,115
|
|
|
7,527
|
|
|
(42,003
|
)
|
|
5,066
|
|
||||
Less: Comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||
Comprehensive income (loss) attributable to common stockholders
|
$
|
12,115
|
|
|
$
|
7,527
|
|
|
$
|
(42,003
|
)
|
|
$
|
5,075
|
|
|
|
|
Casella Waste Systems, Inc. Stockholders' Deficit
|
|
|
||||||||||||||||||||||||||||
|
|
|
Class A
Common Stock
|
|
Class B
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other
Comprehensive Loss |
|
Noncontrolling Interests
|
||||||||||||||||||||
|
Total
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
||||||||||||||||||||
Balance, December 31, 2016
|
$
|
(24,550
|
)
|
|
40,572
|
|
|
$
|
406
|
|
|
988
|
|
|
$
|
10
|
|
|
$
|
348,434
|
|
|
$
|
(373,308
|
)
|
|
$
|
(68
|
)
|
|
$
|
(24
|
)
|
Net loss
|
(41,820
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(41,820
|
)
|
|
—
|
|
|
—
|
|
|||||||
Other comprehensive loss
|
(183
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(183
|
)
|
|
—
|
|
|||||||
Issuances of Class A common stock
|
1,244
|
|
|
483
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
1,239
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock-based compensation
|
4,784
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,784
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Other
|
24
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|||||||
Balance, September 30, 2017
|
$
|
(60,501
|
)
|
|
41,055
|
|
|
$
|
411
|
|
|
988
|
|
|
$
|
10
|
|
|
$
|
354,457
|
|
|
$
|
(415,128
|
)
|
|
$
|
(251
|
)
|
|
$
|
—
|
|
|
Nine Months Ended
September 30, |
||||||
|
2017
|
|
2016
|
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net (loss) income
|
$
|
(41,820
|
)
|
|
$
|
5,116
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
46,307
|
|
|
46,430
|
|
||
Depletion of landfill operating lease obligations
|
6,834
|
|
|
7,130
|
|
||
Interest accretion on landfill and environmental remediation liabilities
|
3,205
|
|
|
2,688
|
|
||
Amortization of debt issuance costs and discount on long-term debt
|
2,005
|
|
|
3,106
|
|
||
Stock-based compensation
|
4,784
|
|
|
2,377
|
|
||
Gain on sale of property and equipment
|
(43
|
)
|
|
(541
|
)
|
||
Southbridge Landfill non-cash closure charge
|
63,526
|
|
|
—
|
|
||
Loss on debt extinguishment
|
517
|
|
|
736
|
|
||
Deferred income taxes
|
384
|
|
|
528
|
|
||
Changes in assets and liabilities, net of effects of acquisitions and divestitures:
|
|
|
|
||||
Accounts receivable
|
(3,887
|
)
|
|
(3,188
|
)
|
||
Accounts payable
|
2,046
|
|
|
2,376
|
|
||
Prepaid expenses, inventories and other assets
|
(1,722
|
)
|
|
(3,262
|
)
|
||
Accrued expenses and other liabilities
|
(3,036
|
)
|
|
(7,425
|
)
|
||
Net cash provided by operating activities
|
79,100
|
|
|
56,071
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Acquisitions, net of cash acquired
|
(3,563
|
)
|
|
(2,439
|
)
|
||
Acquisition related additions to property, plant and equipment
|
(182
|
)
|
|
(38
|
)
|
||
Additions to property, plant and equipment
|
(43,230
|
)
|
|
(37,435
|
)
|
||
Payments on landfill operating lease contracts
|
(3,731
|
)
|
|
(4,811
|
)
|
||
Proceeds from sale of property and equipment
|
657
|
|
|
1,069
|
|
||
Net cash used in investing activities
|
(50,049
|
)
|
|
(43,654
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Proceeds from long-term borrowings
|
146,400
|
|
|
140,700
|
|
||
Principal payments on long-term debt
|
(175,244
|
)
|
|
(152,123
|
)
|
||
Payments of debt issuance costs
|
(1,451
|
)
|
|
(682
|
)
|
||
Payments of debt extinguishment costs
|
—
|
|
|
(410
|
)
|
||
Proceeds from the exercise of share based awards
|
1,003
|
|
|
—
|
|
||
Change in restricted cash
|
—
|
|
|
1,347
|
|
||
Net cash used in financing activities
|
(29,292
|
)
|
|
(11,168
|
)
|
||
Net (decrease) increase in cash and cash equivalents
|
(241
|
)
|
|
1,249
|
|
||
Cash and cash equivalents, beginning of period
|
2,544
|
|
|
2,312
|
|
||
Cash and cash equivalents, end of period
|
$
|
2,303
|
|
|
$
|
3,561
|
|
Supplemental Disclosure of Cash Flow Information:
|
|
|
|
||||
Cash paid during the period for:
|
|
|
|
||||
Interest
|
$
|
19,417
|
|
|
$
|
33,723
|
|
Income taxes, net of refunds
|
$
|
248
|
|
|
$
|
242
|
|
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
|
|
|
|
||||
Non-current assets obtained through long-term obligations
|
$
|
3,564
|
|
|
$
|
1,841
|
|
1.
|
BASIS OF PRESENTATION
|
2.
|
ACCOUNTING CHANGES
|
|
|
|
|
|
Standard
|
|
Description
|
|
Effect on the Financial Statements or Other
Significant Matters
|
Accounting standards that are pending adoption
|
||||
ASU 2017-12: Derivatives and Hedging (Topic 815)
|
|
Requires that an entity align its risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both financial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements.
|
|
The adoption of this guidance affects the designation and measurement guidance for qualifying hedging relationships and the method of presenting hedge results, including the addition of a tabular disclosure related to the effect on the income statement of fair value and cash flow hedges and no longer measuring and reporting hedge ineffectiveness. This guidance is effective January 1, 2019 with early adoption permitted.
|
|
|
|
|
|
ASU 2017-09: Compensation - Stock Compensation (Topic 718)
|
|
Requires that an entity should account for the effects of a modification to an award unless all of the following conditions are met: the fair value of the modified award is the same as the fair value of the original award immediately before the original award is modified; the vesting conditions of the modified award are the same as the vesting conditions immediately before the original award is modified; and the classification of modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified.
|
|
The adoption of this guidance could affect equity compensation expense and net income if there is a modification of an award. This guidance is effective January 1, 2018 with early adoption permitted.
|
|
|
|
|
|
ASU 2017-04: Intangibles - Goodwill and Other (Topic 350)
|
|
Requires that when an entity is performing its annual, or interim, goodwill impairment test, it should compare the fair value of the reporting unit with its carrying amount when calculating its impairment charge, noting that the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, if applicable, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when calculating its impairment charge.
|
|
As of December 31, 2016, we did not record a goodwill impairment charge related to our annual goodwill impairment test because at that time the fair value of each reporting unit exceeded its respective carrying value. Upon adoption, if the carrying value of any of these reporting units exceeds the fair value when we perform a goodwill impairment test, we would record an impairment charge equal to the amount by which the carrying value exceeds its fair value. This guidance is effective January 1, 2020 with early adoption permitted for interim or annual goodwill impairment tests performed after January 1, 2017.
|
|
|
|
|
|
ASU 2016-02, as amended through September 2017: Leases (Topic 842)
|
|
Requires that a lessee recognize at the commencement date: a lease liability, which is the obligation of the lessee to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.
|
|
We are currently assessing the provisions of this guidance and evaluating the timing and impact the guidance will have on our consolidated financial statements and related disclosures. We are also in the process of aggregating lease documentation for review. The adoption of this ASU primarily impacts the balance sheet through the recognition of a right-of-use asset and a lease liability for all leases with terms in excess of 12 months. This guidance is effective January 1, 2019 using a modified retrospective transition approach with early adoption permitted.
|
|
|
|
||
ASU 2016-01: Financial Instruments - Overall (Topic 825-10)
|
|
Requires the following: (1) equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; (2) entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (3) separate presentation of financial assets and financial liabilities by measurement category and form of financial asset; and (4) the elimination of the disclosure requirement to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost.
|
|
The adoption of this guidance results in a cumulative-effect adjustment to the balance sheet, the recognition of changes in fair value of certain equity investments in net income, and enhanced disclosure. This guidance is effective January 1, 2018 with a cumulative-effect adjustment.
|
|
|
|
||
ASU 2014-09, as amended through September 2017: Revenue from Contracts with Customers (Topic 606)
|
|
The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.
|
|
The adoption of this guidance requires using either a full retrospective approach for all periods presented or a modified retrospective approach. We plan to adopt the guidance using the modified retrospective approach, recognizing a cumulative effect adjustment to retained earnings as of the date of adoption. We will record revenue when control is transferred to our customer, generally at the time we provide services. We are evaluating the effect of adopting this guidance on our collection line-of-business, as well as our transfer station, landfill, transportation, energy, customer solutions, recycling and organic services lines-of- business, and we expect our operating results to remain materially unchanged. We are also assessing the effect of adopting this guidance on our disclosures and the recognition of costs we incur to obtain and fulfill our contacts. Currently, these costs are typically expensed as incurred. This guidance is effective January 1, 2018 using a full or modified retrospective approach with early adoption permitted January 1, 2017.
|
3.
|
BUSINESS COMBINATIONS
|
|
Nine Months Ended
September 30, |
||||||
|
2017
|
|
2016
|
||||
Purchase Price:
|
|
|
|
||||
Cash paid for acquisitions
|
$
|
3,383
|
|
|
$
|
2,439
|
|
Notes payable
|
2,400
|
|
|
—
|
|
||
Other non-cash considerations
|
101
|
|
|
—
|
|
||
Holdbacks
|
376
|
|
|
400
|
|
||
Total
|
6,260
|
|
|
2,839
|
|
||
Allocated as follows:
|
|
|
|
||||
Current assets
|
—
|
|
|
40
|
|
||
Land
|
—
|
|
|
353
|
|
||
Building
|
—
|
|
|
1,360
|
|
||
Equipment
|
2,452
|
|
|
269
|
|
||
Intangible assets
|
1,670
|
|
|
—
|
|
||
Other liabilities, net
|
(49
|
)
|
|
(106
|
)
|
||
Fair value of assets acquired and liabilities assumed
|
4,073
|
|
|
1,916
|
|
||
Excess purchase price allocated to goodwill
|
$
|
2,187
|
|
|
$
|
923
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Revenue
|
$
|
160,401
|
|
|
$
|
152,572
|
|
|
$
|
450,512
|
|
|
$
|
426,376
|
|
Operating income (loss)
|
$
|
18,296
|
|
|
$
|
17,434
|
|
|
$
|
(22,334
|
)
|
|
$
|
35,037
|
|
Net income (loss) attributable to common stockholders
|
$
|
12,090
|
|
|
$
|
7,565
|
|
|
$
|
(41,767
|
)
|
|
$
|
5,162
|
|
Basic weighted average common shares outstanding
|
41,951
|
|
|
41,377
|
|
|
41,783
|
|
|
41,169
|
|
||||
Basic earnings per share attributable to common stockholders
|
$
|
0.29
|
|
|
$
|
0.18
|
|
|
$
|
(1.00
|
)
|
|
$
|
0.13
|
|
Diluted weighted average shares outstanding
|
43,295
|
|
|
42,287
|
|
|
41,783
|
|
|
41,896
|
|
||||
Diluted earnings per share attributable to common stockholders
|
$
|
0.28
|
|
|
$
|
0.18
|
|
|
$
|
(1.00
|
)
|
|
$
|
0.12
|
|
4.
|
GOODWILL AND INTANGIBLE ASSETS
|
|
December 31, 2016
|
|
Acquisitions
|
|
September 30, 2017
|
||||||
Eastern region
|
$
|
17,429
|
|
|
$
|
1,764
|
|
|
$
|
19,193
|
|
Western region
|
88,426
|
|
|
422
|
|
|
88,848
|
|
|||
Recycling
|
12,315
|
|
|
—
|
|
|
12,315
|
|
|||
Other
|
1,729
|
|
|
—
|
|
|
1,729
|
|
|||
Total
|
$
|
119,899
|
|
|
$
|
2,186
|
|
|
$
|
122,085
|
|
|
Covenants
Not-to-Compete
|
|
Client Lists
|
|
Total
|
||||||
Balance, September 30, 2017
|
|
|
|
|
|
||||||
Intangible assets
|
$
|
17,975
|
|
|
$
|
17,508
|
|
|
$
|
35,483
|
|
Less accumulated amortization
|
(16,739
|
)
|
|
(10,748
|
)
|
|
(27,487
|
)
|
|||
|
$
|
1,236
|
|
|
$
|
6,760
|
|
|
$
|
7,996
|
|
|
Covenants
Not-to-Compete
|
|
Client Lists
|
|
Total
|
||||||
Balance, December 31, 2016
|
|
|
|
|
|
||||||
Intangible assets
|
$
|
17,594
|
|
|
$
|
16,071
|
|
|
$
|
33,665
|
|
Less accumulated amortization
|
(16,402
|
)
|
|
(9,567
|
)
|
|
(25,969
|
)
|
|||
|
$
|
1,192
|
|
|
$
|
6,504
|
|
|
$
|
7,696
|
|
5.
|
ACCRUED FINAL CAPPING, CLOSURE AND POST CLOSURE
|
|
Nine Months Ended
September 30, |
||||||
|
2017
|
|
2016
|
||||
Beginning balance
|
$
|
44,207
|
|
|
$
|
41,041
|
|
Obligations incurred
|
2,187
|
|
|
1,828
|
|
||
Revisions in estimates (1)
|
9,598
|
|
|
(56
|
)
|
||
Accretion expense
|
3,164
|
|
|
2,688
|
|
||
Obligations settled (2)
|
(586
|
)
|
|
(601
|
)
|
||
Ending balance
|
$
|
58,570
|
|
|
$
|
44,900
|
|
(1)
|
Relates to changes in estimates and assumptions concerning anticipated waste flow, cost and timing of future final capping, closure and post-closure activities at certain landfills, including the Town of Southbridge, Massachusetts ("Town") Landfill ("Southbridge Landfill"). See Note 7,
Commitments and Contingencies
and Note 10,
Other Items and Charges
for disclosure regarding the matter.
|
(2)
|
Includes amounts that are being processed through accounts payable as a part of our disbursements cycle.
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Senior Secured Credit Facility:
|
|
|
|
||||
Revolving Credit Facility due October 2021; bearing interest at LIBOR plus 2.75% and 3.00%, respectively
|
$
|
36,300
|
|
|
$
|
62,600
|
|
Term Loan B Facility due October 2023; bearing interest at LIBOR plus 2.75% and 3.00%, respectively
|
348,250
|
|
|
350,000
|
|
||
Tax-Exempt Bonds:
|
|
|
|
||||
New York State Environmental Facilities Corporation Solid Waste Disposal Revenue Bonds Series 2014 due December 2044 - fixed rate interest period through 2019; bearing interest at 3.75%
|
25,000
|
|
|
25,000
|
|
||
New York State Environmental Facilities Corporation Solid Waste Disposal Revenue Bonds Series 2014R-2 due December 2044 - fixed rate interest period through 2026; bearing interest at 3.125%
|
15,000
|
|
|
15,000
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-3 due January 2025 - fixed rate interest period through 2025; bearing interest at 5.25%
|
25,000
|
|
|
—
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2015 due August 2035 - fixed rate interest period through 2025; bearing interest at 5.125%
|
15,000
|
|
|
15,000
|
|
||
Vermont Economic Development Authority Solid Waste Disposal Long-Term Revenue Bonds Series 2013 due April 2036 - fixed rate interest period through 2018; bearing interest at 4.75%
|
16,000
|
|
|
16,000
|
|
||
Business Finance Authority of the State of New Hampshire Solid Waste Disposal Revenue Bonds Series 2013 due April 2029 - fixed rate interest period through 2019; bearing interest at 4.00%
|
11,000
|
|
|
11,000
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-2 due January 2025 - fixed rate interest period through 2017; bore interest at 6.25%
|
—
|
|
|
21,400
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-1; letter of credit backed due January 2025 - bore interest at SIFMA Index
|
—
|
|
|
3,600
|
|
||
Other:
|
|
|
|
||||
Capital leases maturing through September 2023; bearing interest at up to 7.70%
|
5,870
|
|
|
5,534
|
|
||
Notes payable maturing through June 2027; bearing interest at up to 7.00%
|
2,882
|
|
|
449
|
|
||
Principal amount of long-term debt and capital leases
|
500,302
|
|
|
525,583
|
|
||
Less—unamortized discount and debt issuance costs (1)
|
15,864
|
|
|
16,936
|
|
||
Long-term debt and capital leases less unamortized discount and debt issuance costs
|
484,438
|
|
|
508,647
|
|
||
Less—current maturities of long-term debt
|
6,014
|
|
|
4,686
|
|
||
|
$
|
478,424
|
|
|
$
|
503,961
|
|
(1)
|
A summary of unamortized discount and debt issuance costs by debt instrument follows:
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Revolving Credit Facility
|
$
|
4,195
|
|
|
$
|
4,965
|
|
Term Loan B Facility (including unamortized discount of $1,540 and $1,712)
|
7,682
|
|
|
7,718
|
|
||
New York State Environmental Facilities Corporation Solid Waste Disposal Revenue Bonds Series 2014
|
1,081
|
|
|
1,221
|
|
||
New York State Environmental Facilities Corporation Solid Waste Disposal Revenue Bonds Series 2014R-2
|
526
|
|
|
571
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-3
|
623
|
|
|
—
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2015
|
708
|
|
|
760
|
|
||
Vermont Economic Development Authority Solid Waste Disposal Long-Term Revenue Bonds Series 2013
|
581
|
|
|
605
|
|
||
Business Finance Authority of the State of New Hampshire Solid Waste Disposal Revenue Bonds Series 2013
|
468
|
|
|
563
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-1
|
—
|
|
|
31
|
|
||
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-2
|
—
|
|
|
502
|
|
||
|
$
|
15,864
|
|
|
$
|
16,936
|
|
•
|
the write-off of debt issuance costs in connection with the Repricing Amendment in the quarter ended June 30, 2017;
|
•
|
the write-off of debt issuance costs in connection with the remarketing of the FAME Bonds 2005R-1 and the FAME Bonds 2005R-2 into the FAME Bonds 2005R-3 in the quarter ended March 31, 2017; and
|
•
|
the repurchase price premium and write-off of debt issuance costs and unamortized original issue discount associated with the early redemption, repurchase and retirement of partial portions of our
7.75%
senior subordinated notes due February 2019 in the three and nine months ended September 30, 2016.
|
|
|
|
|
||||
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Beginning balance
|
$
|
—
|
|
|
$
|
—
|
|
Accretion expense
|
41
|
|
|
—
|
|
||
Obligations incurred
|
6,379
|
|
|
—
|
|
||
Obligations settled (1)
|
(241
|
)
|
|
—
|
|
||
Ending balance
|
$
|
6,179
|
|
|
$
|
—
|
|
(1)
|
Includes amounts that are being processed through accounts payable as a part of our disbursements cycle.
|
|
|
|
|
||||
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Beginning balance
|
$
|
5,866
|
|
|
$
|
5,221
|
|
Obligations settled (1)
|
(21
|
)
|
|
(255
|
)
|
||
Ending balance
|
$
|
5,845
|
|
|
$
|
4,966
|
|
(1)
|
Includes amounts that are being processed through accounts payable as a part of our disbursements cycle.
|
8.
|
STOCKHOLDERS' EQUITY
|
|
Stock Options (1)
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Term (years)
|
|
Aggregate Intrinsic Value
|
|||||
Outstanding, December 31, 2016
|
1,115
|
|
|
$
|
6.13
|
|
|
|
|
|
||
Granted
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Exercised
|
(91
|
)
|
|
$
|
10.97
|
|
|
|
|
|
||
Forfeited
|
(5
|
)
|
|
$
|
7.54
|
|
|
|
|
|
||
Outstanding, September 30, 2017
|
1,019
|
|
|
$
|
5.68
|
|
|
5.5
|
|
$
|
13,366
|
|
Exercisable, September 30, 2017
|
819
|
|
|
$
|
5.00
|
|
|
4.8
|
|
$
|
11,305
|
|
Unvested, September 30, 2017
|
240
|
|
|
$
|
9.16
|
|
|
8.5
|
|
$
|
2,313
|
|
(1)
|
Market-based performance stock options are included at the
100%
attainment level. Attainment of the maximum performance targets and market achievements would result in the issuance of an additional
40
shares of Class A common stock currently included in unvested.
|
|
Restricted Stock, Restricted Stock Units, and Performance Stock Units (1)
|
|
Weighted
Average Grant Date Fair
Value
|
|
Weighted Average Remaining Contractual Term (years)
|
|
Aggregate Intrinsic Value
|
|||||
Outstanding, December 31, 2016
|
1,099
|
|
|
$
|
7.03
|
|
|
|
|
|
||
Granted
|
439
|
|
|
$
|
12.32
|
|
|
|
|
|
||
Class A Common Stock Vested
|
(376
|
)
|
|
$
|
5.08
|
|
|
|
|
|
||
Forfeited
|
(23
|
)
|
|
$
|
6.09
|
|
|
|
|
|
||
Outstanding, September 30, 2017
|
1,139
|
|
|
$
|
9.66
|
|
|
1.5
|
|
$
|
10,403
|
|
Unvested, September 30, 2017
|
1,501
|
|
|
$
|
10.35
|
|
|
1.6
|
|
$
|
12,679
|
|
(1)
|
Market-based performance stock unit grants are included at the
100%
attainment level. Attainment of the maximum performance targets and market achievements would result in the issuance of an additional
362
shares of Class A common stock currently included in unvested.
|
|
|
|
|
||||
|
Marketable
Securities
|
|
Interest Rate Swaps
|
||||
Balance, December 31, 2016
|
$
|
(68
|
)
|
|
$
|
—
|
|
Other comprehensive income (loss) before reclassifications
|
64
|
|
|
(567
|
)
|
||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
320
|
|
||
Net current-period other comprehensive income (loss)
|
64
|
|
|
(247
|
)
|
||
Balance, September 30, 2017
|
$
|
(4
|
)
|
|
$
|
(247
|
)
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
||||||||
Details About Accumulated Other Comprehensive Loss Components
|
|
Amounts Reclassified Out of Accumulated Other Comprehensive Loss
|
|
Affected Line Item in the Consolidated
Statements of Operations
|
||||||||||||||
Interest rate swaps
|
|
$
|
112
|
|
|
$
|
—
|
|
|
$
|
320
|
|
|
$
|
—
|
|
|
Interest expense
|
|
|
112
|
|
|
—
|
|
|
320
|
|
|
—
|
|
|
Income (loss) before income taxes
|
||||
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Provision for income taxes
|
||||
|
|
$
|
112
|
|
|
$
|
—
|
|
|
$
|
320
|
|
|
$
|
—
|
|
|
Net income (loss)
|
9.
|
EARNINGS PER SHARE
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to common stockholders
|
$
|
12,080
|
|
|
$
|
7,537
|
|
|
$
|
(41,820
|
)
|
|
$
|
5,125
|
|
Denominators:
|
|
|
|
|
|
|
|
||||||||
Number of shares outstanding, end of period:
|
|
|
|
|
|
|
|
||||||||
Class A common stock
|
41,055
|
|
|
40,500
|
|
|
41,055
|
|
|
40,500
|
|
||||
Class B common stock
|
988
|
|
|
988
|
|
|
988
|
|
|
988
|
|
||||
Unvested restricted stock
|
(82
|
)
|
|
(109
|
)
|
|
(82
|
)
|
|
(109
|
)
|
||||
Effect of weighted average shares outstanding
|
(10
|
)
|
|
(2
|
)
|
|
(178
|
)
|
|
(210
|
)
|
||||
Basic weighted average common shares outstanding
|
41,951
|
|
|
41,377
|
|
|
41,783
|
|
|
41,169
|
|
||||
Impact of potentially dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Dilutive effect of stock options and other stock awards
|
1,344
|
|
|
910
|
|
|
—
|
|
|
727
|
|
||||
Diluted weighted average common shares outstanding
|
43,295
|
|
|
42,287
|
|
|
41,783
|
|
|
41,896
|
|
||||
Anti-dilutive potentially issuable shares
|
—
|
|
|
322
|
|
|
2,560
|
|
|
322
|
|
10.
|
Other Items and Charges
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|||||||||
Asset impairment charge (1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
47,999
|
|
|
$
|
—
|
|
|
Project development charge (2)
|
—
|
|
|
—
|
|
|
9,149
|
|
|
—
|
|
|||||
Environmental remediation charge (3)
|
—
|
|
|
—
|
|
|
6,379
|
|
|
—
|
|
|||||
Legal and transaction costs (4)
|
754
|
|
|
—
|
|
|
1,341
|
|
|
—
|
|
|||||
Southbridge Landfill closure charge
|
$
|
754
|
|
|
$
|
—
|
|
—
|
|
$
|
64,868
|
|
|
$
|
—
|
|
(1)
|
We performed a test of recoverability under FASB ASC 360 - Property, Plant, and Equipment, which indicated that the carrying value of our asset group that includes the Southbridge Landfill was no longer recoverable and, as a result, the asset group was assessed for impairment with an impairment charge allocated to the long-lived assets of the Southbridge Landfill in accordance with FASB ASC 360 - Property, Plant, and Equipment.
|
(2)
|
We wrote-off deferred costs associated with Southbridge Landfill permitting activities no longer deemed viable.
|
(3)
|
We recorded an environmental remediation charge associated with the future installation of a municipal waterline. See Note 7,
Commitments and Contingencies
for additional disclosure.
|
(4)
|
We incurred legal and other transaction costs associated with various matters as part of the Southbridge Landfill closure. See Note 7,
Commitments and Contingencies
for additional disclosure.
|
11.
|
FAIR VALUE OF FINANCIAL INSTRUMENTS
|
|
Fair Value Measurement at December 31, 2016 Using:
|
||||||||||
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable Inputs
(Level 3)
|
||||||
Assets:
|
|
|
|
|
|
||||||
Restricted investments - landfill closure
|
$
|
1,002
|
|
|
$
|
—
|
|
|
$
|
—
|
|
12.
|
SEGMENT REPORTING
|
Segment
|
Outside
revenues
|
|
Inter-company
revenue
|
|
Depreciation and
amortization
|
|
Operating
income (loss)
|
|
Total
assets
|
||||||||||
Eastern
|
$
|
49,066
|
|
|
$
|
14,296
|
|
|
$
|
6,122
|
|
|
$
|
5,897
|
|
|
$
|
155,726
|
|
Western
|
67,992
|
|
|
19,183
|
|
|
8,572
|
|
|
11,579
|
|
|
335,373
|
|
|||||
Recycling
|
16,360
|
|
|
(292
|
)
|
|
1,044
|
|
|
638
|
|
|
49,471
|
|
|||||
Other
|
26,851
|
|
|
531
|
|
|
853
|
|
|
163
|
|
|
51,850
|
|
|||||
Eliminations
|
—
|
|
|
(33,718
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
160,269
|
|
|
$
|
—
|
|
|
$
|
16,591
|
|
|
$
|
18,277
|
|
|
$
|
592,420
|
|
Segment
|
Outside
revenues
|
|
Inter-company
revenue
|
|
Depreciation and
amortization
|
|
Operating
income (loss)
|
|
Total
assets
|
||||||||||
Eastern
|
$
|
47,238
|
|
|
$
|
12,775
|
|
|
$
|
7,291
|
|
|
$
|
4,452
|
|
|
$
|
206,177
|
|
Western
|
63,171
|
|
|
18,560
|
|
|
7,010
|
|
|
11,392
|
|
|
326,862
|
|
|||||
Recycling
|
14,412
|
|
|
94
|
|
|
1,055
|
|
|
1,529
|
|
|
48,531
|
|
|||||
Other
|
26,312
|
|
|
530
|
|
|
819
|
|
|
5
|
|
|
53,685
|
|
|||||
Eliminations
|
—
|
|
|
(31,959
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
151,133
|
|
|
$
|
—
|
|
|
$
|
16,175
|
|
|
$
|
17,378
|
|
|
$
|
635,255
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment
|
Outside
revenues
|
|
Inter-company
revenue
|
|
Depreciation and
amortization
|
|
Operating
income (loss)
|
|
Total assets
|
||||||||||
Eastern
|
$
|
134,326
|
|
|
$
|
37,020
|
|
|
$
|
17,949
|
|
|
$
|
(54,407
|
)
|
|
$
|
155,726
|
|
Western
|
186,507
|
|
|
53,590
|
|
|
22,762
|
|
|
26,438
|
|
|
335,373
|
|
|||||
Recycling
|
49,206
|
|
|
(781
|
)
|
|
3,066
|
|
|
3,285
|
|
|
49,471
|
|
|||||
Other
|
78,048
|
|
|
1,516
|
|
|
2,530
|
|
|
2,247
|
|
|
51,850
|
|
|||||
Eliminations
|
—
|
|
|
(91,345
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
448,087
|
|
|
$
|
—
|
|
|
$
|
46,307
|
|
|
$
|
(22,437
|
)
|
|
$
|
592,420
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment
|
Outside
revenues
|
|
Inter-company
revenue
|
|
Depreciation and
amortization
|
|
Operating
income (loss)
|
|
Total assets
|
||||||||||
Eastern
|
$
|
131,630
|
|
|
$
|
34,003
|
|
|
$
|
20,618
|
|
|
$
|
6,742
|
|
|
$
|
206,177
|
|
Western
|
175,093
|
|
|
51,300
|
|
|
20,409
|
|
|
24,561
|
|
|
326,862
|
|
|||||
Recycling
|
37,865
|
|
|
1,026
|
|
|
3,187
|
|
|
923
|
|
|
48,531
|
|
|||||
Other
|
76,648
|
|
|
1,213
|
|
|
2,216
|
|
|
2,721
|
|
|
53,685
|
|
|||||
Eliminations
|
—
|
|
|
(87,542
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
421,236
|
|
|
$
|
—
|
|
|
$
|
46,430
|
|
|
$
|
34,947
|
|
|
$
|
635,255
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Collection
|
$
|
70,040
|
|
|
$
|
65,581
|
|
|
$
|
196,185
|
|
|
$
|
187,117
|
|
Disposal
|
44,881
|
|
|
43,412
|
|
|
118,334
|
|
|
115,050
|
|
||||
Power generation
|
1,215
|
|
|
1,610
|
|
|
4,121
|
|
|
4,777
|
|
||||
Processing
|
2,499
|
|
|
1,974
|
|
|
6,296
|
|
|
4,694
|
|
||||
Solid waste operations
|
118,635
|
|
|
112,577
|
|
|
324,936
|
|
|
311,638
|
|
||||
Organics
|
9,662
|
|
|
10,266
|
|
|
29,881
|
|
|
31,372
|
|
||||
Customer solutions
|
15,612
|
|
|
13,878
|
|
|
44,064
|
|
|
40,361
|
|
||||
Recycling
|
16,360
|
|
|
14,412
|
|
|
49,206
|
|
|
37,865
|
|
||||
Total revenues
|
$
|
160,269
|
|
|
$
|
151,133
|
|
|
$
|
448,087
|
|
|
$
|
421,236
|
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
the projected development of additional disposal capacity or expectations regarding permits for existing capacity;
|
•
|
the outcome of any legal or regulatory matter;
|
•
|
expected liquidity and financing plans;
|
•
|
expected future revenues, operations, expenditures and cash needs;
|
•
|
fluctuations in the commodity pricing of our recyclables, increases in landfill tipping fees and fuel costs and general economic and weather conditions;
|
•
|
projected future obligations related to final capping, closure and post-closure costs of our existing landfills and any disposal facilities which we may own or operate in the future;
|
•
|
our ability to use our net operating losses and tax positions;
|
•
|
our ability to service our debt obligations;
|
•
|
the recoverability or impairment of any of our assets or goodwill;
|
•
|
estimates of the potential markets for our products and services, including the anticipated drivers for future growth;
|
•
|
sales and marketing plans or price and volume assumptions;
|
•
|
potential business combinations or divestitures; and
|
•
|
projected improvements to our infrastructure and the impact of such improvements on our business and operations.
|
|
Three Months Ended September 30,
|
|
$
Change
|
|
Nine Months Ended September 30,
|
|
$
Change
|
||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|||||||||||||||||||||||||||
Collection
|
$
|
70.0
|
|
|
43.7
|
%
|
|
$
|
65.6
|
|
|
43.4
|
%
|
|
$
|
4.4
|
|
|
$
|
196.2
|
|
|
43.8
|
%
|
|
$
|
187.1
|
|
|
44.4
|
%
|
|
$
|
9.1
|
|
Disposal
|
44.9
|
|
|
28.0
|
%
|
|
43.4
|
|
|
28.7
|
%
|
|
1.5
|
|
|
118.3
|
|
|
26.4
|
%
|
|
115.0
|
|
|
27.3
|
%
|
|
3.3
|
|
||||||
Power
|
1.2
|
|
|
0.8
|
%
|
|
1.6
|
|
|
1.1
|
%
|
|
(0.4
|
)
|
|
4.1
|
|
|
0.9
|
%
|
|
4.8
|
|
|
1.1
|
%
|
|
(0.7
|
)
|
||||||
Processing
|
2.5
|
|
|
1.5
|
%
|
|
2.0
|
|
|
1.3
|
%
|
|
0.5
|
|
|
6.3
|
|
|
1.4
|
%
|
|
4.7
|
|
|
1.2
|
%
|
|
1.6
|
|
||||||
Solid waste
|
118.6
|
|
|
74.0
|
%
|
|
112.6
|
|
|
74.5
|
%
|
|
6.0
|
|
|
324.9
|
|
|
72.5
|
%
|
|
311.6
|
|
|
74.0
|
%
|
|
13.3
|
|
||||||
Organics
|
9.7
|
|
|
6.1
|
%
|
|
10.2
|
|
|
6.8
|
%
|
|
(0.5
|
)
|
|
29.9
|
|
|
6.7
|
%
|
|
31.3
|
|
|
7.4
|
%
|
|
(1.4
|
)
|
||||||
Customer solutions
|
15.6
|
|
|
9.7
|
%
|
|
13.9
|
|
|
9.2
|
%
|
|
1.7
|
|
|
44.1
|
|
|
9.8
|
%
|
|
40.4
|
|
|
9.6
|
%
|
|
3.7
|
|
||||||
Recycling
|
16.4
|
|
|
10.2
|
%
|
|
14.4
|
|
|
9.5
|
%
|
|
2.0
|
|
|
49.2
|
|
|
11.0
|
%
|
|
37.9
|
|
|
9.0
|
%
|
|
11.3
|
|
||||||
Total revenues
|
$
|
160.3
|
|
|
100.0
|
%
|
|
$
|
151.1
|
|
|
100.0
|
%
|
|
$
|
9.2
|
|
|
$
|
448.1
|
|
|
100.0
|
%
|
|
$
|
421.2
|
|
|
100.0
|
%
|
|
$
|
26.9
|
|
|
Period-to-Period
Change for the Three Months Ended September 30, 2017 vs. 2016 |
|
Period-to-Period
Change for the Nine Months Ended September 30, 2017 vs. 2016 |
||||||||||
|
Amount
|
|
% of Growth
|
|
Amount
|
|
% of Growth
|
||||||
Price
|
$
|
3.5
|
|
|
2.3
|
%
|
|
$
|
8.5
|
|
|
2.0
|
%
|
Volume
|
1.3
|
|
|
0.9
|
%
|
|
2.4
|
|
|
0.7
|
%
|
||
Fuel surcharge and other fees
|
—
|
|
|
—
|
%
|
|
(0.3
|
)
|
|
(0.1
|
)%
|
||
Commodity price and volume
|
(0.1
|
)
|
|
—
|
%
|
|
0.6
|
|
|
0.1
|
%
|
||
Acquisitions and divestitures
|
1.3
|
|
|
0.8
|
%
|
|
2.1
|
|
|
0.5
|
%
|
||
Solid waste revenues
|
$
|
6.0
|
|
|
4.0
|
%
|
|
$
|
13.3
|
|
|
3.2
|
%
|
•
|
$
2.2 million
from
favorable
collection pricing, including a fixed component of the energy and environmental fee to mitigate increasing environmental protection and regulatory compliance costs; and
|
•
|
$
1.3 million
from
favorable
disposal pricing associated with our landfills and transfer stations.
|
•
|
$
5.4 million
from
favorable
collection pricing, including a fixed component of the energy and environmental fee to mitigate increasing environmental protection and regulatory compliance costs; and
|
•
|
$
3.1 million
from
favorable
disposal pricing associated with our landfills and transfer stations.
|
•
|
$
1.1 million
from
higher
collection volumes; and
|
•
|
$
0.2 million
from
higher
disposal volumes related to transfer stations.
|
•
|
$
2.1 million
from
higher
collection volumes; and
|
•
|
$
0.4 million
from
higher
processing volumes; partially offset by
|
•
|
$
(0.1) million
from
lower
disposal volumes (of which $(0.5) million relates to lower landfill volumes associated with diversion of tons from the Southbridge Landfill, $(0.2) million relates to lower transportation volumes, and $0.6 million relates to higher transfer station volumes).
|
•
|
$
(0.3) million
from lower revenues generated from our Sustainability Recycling Adjustment fee ("SRA fee") as a result of
higher
commodity pricing.
|
•
|
$(0.4) million from lower landfill gas-to-energy volumes; partially offset by
|
•
|
$0.3 million from favorable processing commodity pricing and higher processing volumes.
|
•
|
$1.3 million from favorable processing commodity pricing and higher processing volumes; partially offset by
|
•
|
$(0.4) million from lower landfill gas-to-energy volumes; and
|
•
|
$(0.3) million from unfavorable energy pricing.
|
•
|
$
2.5 million
from
favorable
commodity pricing in the marketplace; and
|
•
|
$
0.1 million
from
higher
commodity volumes; partially offset by
|
•
|
$
(0.6) million
from
lower
tipping fees, as we reduced variable tipping fees at our facilities as commodity prices increased.
|
•
|
$
12.6 million
from
favorable
commodity pricing in the marketplace; and
|
•
|
$
1.6 million
from
higher
commodity volumes; partially offset by
|
•
|
$
(2.9) million
from
lower
tipping fees, as we reduced variable tipping fees at our facilities as commodity prices increased.
|
|
Three Months Ended September 30,
|
|
$
Change
|
|
Nine Months Ended September 30,
|
|
$
Change
|
||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|||||||||||||||||||||||||||
Cost of operations
|
$
|
103.9
|
|
|
64.8
|
%
|
|
$
|
98.8
|
|
|
65.4
|
%
|
|
$
|
5.1
|
|
|
$
|
301.0
|
|
|
67.2
|
%
|
|
$
|
284.4
|
|
|
67.5
|
%
|
|
$
|
16.6
|
|
General and administration
|
$
|
20.8
|
|
|
12.9
|
%
|
|
$
|
18.8
|
|
|
12.4
|
%
|
|
$
|
2.0
|
|
|
$
|
58.4
|
|
|
13.0
|
%
|
|
$
|
55.5
|
|
|
13.2
|
%
|
|
$
|
2.9
|
|
Depreciation and amortization
|
$
|
16.6
|
|
|
10.4
|
%
|
|
$
|
16.2
|
|
|
10.7
|
%
|
|
$
|
0.4
|
|
|
$
|
46.3
|
|
|
10.3
|
%
|
|
$
|
46.4
|
|
|
11.0
|
%
|
|
$
|
(0.1
|
)
|
•
|
higher purchased material costs in our Recycling and Customer Solutions lines-of-business;
|
•
|
higher disposal costs associated with higher transfer station volumes and third-party disposal pricing in the Western region, and additional costs from the use of alternative disposal sites in our Organics line-of-business; and
|
•
|
higher hauling and transportation costs with higher collection volumes in the Eastern region; and higher quarterly hauling and transportation costs with increased volumes on lower margin commercial work in our Customer Solutions line-of-business; partially offset by lower hauling and transportation costs associated with decreased transportation services provided in the Western region; and lower commodity volumes in our Organics line-of-business.
|
•
|
higher healthcare costs of $1.6 million year-to-date associated with direct operational labor;
|
•
|
higher labor costs associated with higher collection volumes in the Eastern region as well as customer growth related to several new municipal contracts; and
|
•
|
higher labor costs associated with higher volumes and higher product quality standards from commodity buyers resulting in lower throughput and additional manpower in our Recycling line-of-business.
|
•
|
higher leachate disposal costs and landfill operating costs at certain landfills in the Western region due to increased rainfall through early summer and the timing of various landfill construction projects;
|
•
|
higher host community fees associated with increased volumes at certain landfills in the Western region;
|
•
|
higher quarterly accretion expense associated with the acceleration of asset retirement obligations due to the closure of the Southbridge Landfill; and
|
•
|
higher equipment rental costs in the Eastern region; partially offset by
|
•
|
lower landfill operating costs associated with certain landfills in the Eastern region.
|
|
Three Months Ended September 30,
|
|
$
Change
|
|
Nine Months Ended September 30,
|
|
$
Change
|
||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|||||||||||||||||||||||||||
Depreciation
|
$
|
8.0
|
|
|
5.0
|
%
|
|
$
|
8.2
|
|
|
5.4
|
%
|
|
$
|
(0.2
|
)
|
|
$
|
24.1
|
|
|
5.4
|
%
|
|
$
|
24.9
|
|
|
5.9
|
%
|
|
$
|
(0.8
|
)
|
Landfill amortization
|
8.1
|
|
|
5.0
|
%
|
|
7.4
|
|
|
4.9
|
%
|
|
0.7
|
|
|
$
|
20.6
|
|
|
4.6
|
%
|
|
$
|
19.9
|
|
|
4.7
|
%
|
|
0.7
|
|
||||
Other amortization
|
0.5
|
|
|
0.3
|
%
|
|
0.6
|
|
|
0.4
|
%
|
|
(0.1
|
)
|
|
$
|
1.6
|
|
|
0.4
|
%
|
|
$
|
1.6
|
|
|
0.4
|
%
|
|
—
|
|
||||
|
$
|
16.6
|
|
|
10.3
|
%
|
|
$
|
16.2
|
|
|
10.7
|
%
|
|
$
|
0.4
|
|
|
$
|
46.3
|
|
|
10.4
|
%
|
|
$
|
46.4
|
|
|
11.0
|
%
|
|
$
|
(0.1
|
)
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|||||||||
Asset impairment charge (1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48.0
|
|
|
$
|
—
|
|
|
Project development charge (2)
|
—
|
|
|
—
|
|
|
9.1
|
|
|
—
|
|
|||||
Environmental remediation charge (3)
|
—
|
|
|
—
|
|
|
6.4
|
|
|
—
|
|
|||||
Legal and transaction costs (4)
|
0.8
|
|
|
—
|
|
|
1.3
|
|
|
—
|
|
|||||
Southbridge Landfill closure charge
|
$
|
0.8
|
|
|
$
|
—
|
|
—
|
|
$
|
64.9
|
|
|
$
|
—
|
|
(1)
|
We performed a test of recoverability under Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 360, which indicated that the carrying value of our asset group that includes the Southbridge Landfill was no longer recoverable and, as a result, the asset group was assessed for impairment with an impairment charge allocated to the long-lived assets of the Southbridge Landfill in accordance with FASB ASC 360.
|
(2)
|
We wrote-off deferred costs associated with Southbridge Landfill permitting activities no longer deemed viable.
|
(3)
|
We recorded an environmental remediation charge associated with the future installation of a municipal waterline.
|
(4)
|
We incurred legal and other transaction costs associated with various matters as part of the Southbridge Landfill closure.
|
•
|
we completed the issuance of $15.0 million of New York State Environmental Facilities Corporation Solid Waste Disposal Revenue Bonds Series 2014R-2 (“New York Bonds 2016”) in June 2016;
|
•
|
we completed the refinancing of our senior secured asset-based revolving credit and letter of credit facility ("ABL Facility") with our credit facility, which consists of a $350.0 million term loan B facility ("Term Loan B Facility") and a $160.0 million revolving line of credit facility ("Revolving Credit Facility" and, together with the Term Loan B Facility, the "Credit Facility") and repaid in full our ABL Facility in October 2016;
|
•
|
we repurchased or redeemed, as applicable, $366.1 million of our most expensive debt, the 7.75% senior subordinated notes due February 2019 ("2019 Notes"), between June 2016 and October 2016;
|
•
|
we remarketed
$3.6 million
aggregate principal amount of Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-1 (“FAME Bonds 2005R-1”) and
$21.4 million
aggregate principal amount of Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-2 (“FAME Bonds 2005R-2”) into one series of
$25.0 million
aggregate principal amount of Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-3 (“FAME Bonds 2005R-3”) in February 2017; and
|
•
|
we entered into the first amendment ("Repricing Amendment") to our Term Loan B Facility and Revolving Credit Facility, which decreased the applicable interest margin for our Term Loan B Facility by 25 basis points for both LIBOR borrowings and base rate borrowings in April 2017.
|
•
|
the write-off of debt issuance costs in connection with the Repricing Amendment in the quarter ended June 30, 2017;
|
•
|
the write-off of debt issuance costs in connection with the remarketing of the FAME Bonds 2005R-1 and the FAME Bonds 2005R-2 into FAME Bonds 2005R-3 in the quarter ended March 31, 2017; and
|
•
|
the repurchase price premium and write-off of debt issuance costs and unamortized original issue discount associated with the early redemption, repurchase and retirement of partial portions of our 2019 Notes in the three and nine months ended September 30, 2016.
|
|
Three Months Ended
September 30, |
|
$
Change
|
|
Nine Months Ended
September 30, |
|
$
Change
|
||||||||||||||||
Segment
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|||||||||||||||
Eastern
|
$
|
49.1
|
|
|
$
|
47.2
|
|
|
$
|
1.9
|
|
|
$
|
134.3
|
|
|
$
|
131.6
|
|
|
$
|
2.7
|
|
Western
|
68.0
|
|
|
63.2
|
|
|
4.8
|
|
|
186.5
|
|
|
175.1
|
|
|
11.4
|
|
||||||
Recycling
|
16.4
|
|
|
14.4
|
|
|
2.0
|
|
|
49.2
|
|
|
37.9
|
|
|
11.3
|
|
||||||
Other
|
26.8
|
|
|
26.3
|
|
|
0.5
|
|
|
78.1
|
|
|
76.6
|
|
|
1.5
|
|
||||||
Total revenues
|
$
|
160.3
|
|
|
$
|
151.1
|
|
|
$
|
9.2
|
|
|
$
|
448.1
|
|
|
$
|
421.2
|
|
|
$
|
26.9
|
|
|
Period-to-Period Change for the Three Months Ended September 30, 2017 vs. 2016
|
|
Period-to-Period Change for the Nine Months Ended September 30, 2017 vs. 2016
|
||||||||||
|
Amount
|
|
% of Growth
|
|
Amount
|
|
% of Growth
|
||||||
Price
|
$
|
1.6
|
|
|
3.4
|
%
|
|
$
|
3.8
|
|
|
2.9
|
%
|
Volume
|
(0.5
|
)
|
|
(1.2
|
)%
|
|
(1.7
|
)
|
|
(1.3
|
)%
|
||
Fuel surcharge and other fees
|
(0.1
|
)
|
|
(0.2
|
)%
|
|
(0.3
|
)
|
|
(0.2
|
)%
|
||
Commodity price and volume
|
(0.1
|
)
|
|
(0.2
|
)%
|
|
(0.5
|
)
|
|
(0.4
|
)%
|
||
Acquisitions and divestitures
|
1.0
|
|
|
2.1
|
%
|
|
1.4
|
|
|
1.0
|
%
|
||
Solid waste revenues
|
$
|
1.9
|
|
|
3.9
|
%
|
|
$
|
2.7
|
|
|
2.0
|
%
|
•
|
$1.1 million
from
favorable
collection pricing; and
|
•
|
$0.5 million
from
favorable
disposal pricing related to transfer stations and landfills.
|
•
|
$2.5 million
from
favorable
collection pricing; and
|
•
|
$1.3 million
from
favorable
disposal pricing related to transfer stations and landfills.
|
•
|
$(1.8) million
from
lower
disposal volumes (of which $(1.8) million relates to lower landfill volumes due to the diversion of tons from the Southbridge Landfill); partially offset by
|
•
|
$1.3 million
from
higher
collection volumes.
|
•
|
$(4.1) million
from
lower
disposal volumes (of which $(3.9) million relates to lower landfill volumes from the diversion of tons from the Southbridge Landfill and $(0.2) million relates to lower transfer station volumes); partially offset by
|
•
|
$2.4 million
from
higher
collection volumes.
|
|
Period-to-Period Change for the Three Months Ended September 30, 2017 vs. 2016
|
|
Period-to-Period Change for the Nine Months Ended September 30, 2017 vs. 2016
|
||||||||||
|
Amount
|
|
% of Growth
|
|
Amount
|
|
% of Growth
|
||||||
Price
|
$
|
1.8
|
|
|
2.9
|
%
|
|
$
|
4.7
|
|
|
2.7
|
%
|
Volume
|
2.6
|
|
|
4.2
|
%
|
|
4.8
|
|
|
2.8
|
%
|
||
Commodity price and volume
|
0.1
|
|
|
0.1
|
%
|
|
1.1
|
|
|
0.6
|
%
|
||
Acquisitions & divestitures
|
0.3
|
|
|
0.4
|
%
|
|
0.8
|
|
|
0.4
|
%
|
||
Solid waste revenues
|
$
|
4.8
|
|
|
7.6
|
%
|
|
$
|
11.4
|
|
|
6.5
|
%
|
•
|
$1.1 million
from
favorable
collection pricing; and
|
•
|
$0.7 million
from
favorable
disposal pricing related to landfills and transfer stations.
|
•
|
$2.9 million
from
favorable
collection pricing; and
|
•
|
$1.8 million
from
favorable
disposal pricing related to transfer stations and landfills.
|
•
|
$2.7 million
from
higher
disposal volumes (of which $1.8 million relates to higher landfill volumes, $0.6 million relates to higher transportation volumes and $0.3 million relates to higher transfer station volumes); partially offset by
|
•
|
$(0.1) million
from
lower
collection volumes.
|
•
|
$4.8 million
from
higher
disposal volumes (of which $3.4 million relates to higher landfill volumes, $0.8 million relates to higher transfer station volumes and $0.6 million relates to higher transportation volumes); and
|
•
|
$0.2 million
from
higher
processing volumes; partially offset by
|
•
|
$(0.2) million
from
lower
collection volumes.
|
|
Three Months Ended September 30,
|
|
$
Change
|
|
Nine Months Ended September 30,
|
|
$
Change
|
||||||||||||||||
Segment
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|||||||||||||||
Eastern
|
$
|
5.9
|
|
|
$
|
4.5
|
|
|
$
|
1.4
|
|
|
$
|
(54.4
|
)
|
|
$
|
6.7
|
|
|
$
|
(61.1
|
)
|
Western
|
11.6
|
|
|
11.4
|
|
|
0.2
|
|
|
26.4
|
|
|
24.6
|
|
|
1.8
|
|
||||||
Recycling
|
0.6
|
|
|
1.5
|
|
|
(0.9
|
)
|
|
3.3
|
|
|
0.9
|
|
|
2.4
|
|
||||||
Other
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|
2.3
|
|
|
2.7
|
|
|
(0.4
|
)
|
||||||
Operating income (loss)
|
$
|
18.3
|
|
|
$
|
17.4
|
|
|
$
|
0.9
|
|
|
$
|
(22.4
|
)
|
|
$
|
34.9
|
|
|
$
|
(57.3
|
)
|
•
|
higher hauling and transportation costs associated with higher collection volumes; and
|
•
|
higher direct labor costs associated with higher collection volumes, customer growth related to several new municipal contracts, and higher healthcare costs of $0.7 million year-to-date.
|
•
|
higher disposal costs associated with higher transfer station volumes and increased third-party disposal pricing;
|
•
|
higher direct labor costs year-to-date associated with increased labor costs and increased healthcare costs of $0.7 million;
|
•
|
higher direct operational costs associated with increased leachate disposal and landfill operating costs due to; increased rainfall through early summer and the timing of various landfill construction projects; and higher host community fees associated with increased volumes at certain of our landfills; and
|
•
|
higher fleet maintenance costs; partially offset by
|
•
|
lower hauling and transportation costs associated with decreased transportation services provided.
|
•
|
higher third-party purchased material costs due to higher commodity prices on average year-over-year, accentuated in the quarter by the significant sequential decline in commodity pricing from August to September, which resulted in higher purchased materials costs based on trailing contractual calculations; and
|
•
|
higher labor and related benefit costs associated with higher healthcare costs year-to-date, higher volumes, and higher product quality standards from commodity buyers resulting in lower throughput and additional manpower.
|
•
|
lower operating performance of our Organics line-of-business, as lower operating costs did not offset the decline in commodity volumes and higher disposal costs due to the use of alternative disposal sites; and
|
•
|
improved operating performance of our Customer Solutions line-of-business, as increased volumes outweighed higher cost of operations associated with increased purchased material, hauling and transportation, and healthcare costs.
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Cash and cash equivalents
|
$
|
2.3
|
|
|
$
|
2.5
|
|
Restricted assets:
|
|
|
|
||||
Restricted investments - landfill closure
|
$
|
1.1
|
|
|
$
|
1.0
|
|
Long-term debt:
|
|
|
|
||||
Current portion
|
$
|
6.0
|
|
|
$
|
4.7
|
|
Long-term portion
|
494.3
|
|
|
520.9
|
|
||
Total long-term debt
|
$
|
500.3
|
|
|
$
|
525.6
|
|
|
Nine Months Ended September 30,
|
|
$
Change
|
||||||||
|
2017
|
|
2016
|
|
|||||||
Net cash provided by operating activities
|
$
|
79.1
|
|
|
$
|
56.1
|
|
|
$
|
23.0
|
|
Net cash used in investing activities
|
$
|
(50.0
|
)
|
|
$
|
(43.7
|
)
|
|
$
|
(6.3
|
)
|
Net cash used in financing activities
|
$
|
(29.3
|
)
|
|
$
|
(11.2
|
)
|
|
$
|
(18.1
|
)
|
|
Nine Months Ended
September 30, |
||||||
|
2017
|
|
2016
|
||||
Net (loss) income
|
$
|
(41.8
|
)
|
|
$
|
5.1
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
46.3
|
|
|
46.4
|
|
||
Depletion of landfill operating lease obligations
|
6.8
|
|
|
7.1
|
|
||
Interest accretion on landfill and environmental remediation liabilities
|
3.2
|
|
|
2.7
|
|
||
Amortization of debt issuance costs and discount on long-term debt
|
2.0
|
|
|
3.1
|
|
||
Stock-based compensation
|
4.8
|
|
|
2.4
|
|
||
Gain on sale of property and equipment
|
—
|
|
|
(0.5
|
)
|
||
Southbridge Landfill non-cash closure charge
|
63.5
|
|
|
—
|
|
||
Loss on debt extinguishment
|
0.5
|
|
|
0.7
|
|
||
Deferred income taxes
|
0.4
|
|
|
0.5
|
|
||
|
85.7
|
|
|
67.5
|
|
||
Changes in assets and liabilities, net
|
(6.6
|
)
|
|
(11.4
|
)
|
||
Net cash provided by operating activities
|
$
|
79.1
|
|
|
$
|
56.1
|
|
•
|
higher revenues of
$26.9 million
driven by our Recycling line-of-business, our collection line-of-business, our Western region disposal line-of-business and our Customer Solutions line-of-business; partially offset by
|
•
|
higher cost of operations of
$16.6 million
driven by higher third-party direct costs, higher labor and related benefit costs, including significant healthcare cost increases, and higher direct operational costs; and
|
•
|
higher general and administration expenses of
$2.9 million
driven by higher labor and related benefit costs, including significant healthcare cost increases.
|
•
|
lower cash outflows associated with cash interest payments running through accrued expenses and other liabilities; and
|
•
|
lower cash outflows associated with prepaid expenses, inventories and other assets; partially offset by
|
•
|
higher cash outflows associated with accrued payroll and incentive compensation;
|
•
|
lower cash inflows associated with accounts receivable; and
|
•
|
higher cash outflows associated with accounts payable.
|
|
Nine Months Ended
September 30, |
||||||
|
2017
|
|
2016
|
||||
Acquisitions, net of cash acquired
|
$
|
(3.5
|
)
|
|
$
|
(2.4
|
)
|
Acquisition related additions to property, plant and equipment
|
(0.2
|
)
|
|
—
|
|
||
Additions to property, plant and equipment
|
(43.2
|
)
|
|
(37.4
|
)
|
||
Payments on landfill operating lease contracts
|
(3.7
|
)
|
|
(4.8
|
)
|
||
Proceeds from sale of property and equipment
|
0.6
|
|
|
0.9
|
|
||
Net cash used in investing activities
|
$
|
(50.0
|
)
|
|
$
|
(43.7
|
)
|
|
Nine Months Ended
September 30, |
||||||
|
2017
|
|
2016
|
||||
Proceeds from long-term borrowings
|
$
|
146.4
|
|
|
$
|
140.7
|
|
Principal payments on long-term debt
|
(175.2
|
)
|
|
(152.1
|
)
|
||
Payments of debt issuance costs
|
(1.5
|
)
|
|
(0.7
|
)
|
||
Payments of debt extinguishment costs
|
—
|
|
|
(0.4
|
)
|
||
Proceeds from the exercise of share based awards
|
1.0
|
|
|
—
|
|
||
Change in restricted cash
|
—
|
|
|
1.3
|
|
||
Net cash used in financing activities
|
$
|
(29.3
|
)
|
|
$
|
(11.2
|
)
|
•
|
the pay down of $28.1 million of long-term debt under the Credit Facility in the nine months ended September 30, 2017;
|
•
|
the remarketing of the FAME Bonds 2005R-1 and the FAME Bonds 2005R-2 into the $25.0 million FAME Bonds 2005R-3 in the nine months ended September 30, 2017;
|
•
|
the issuance by the New York State Environmental Facilities Corporation of the New York Bonds 2016 in the nine months ended September 30, 2016;
and
|
•
|
the repurchase or redemption, as applicable, and retirement of $24.7 million aggregate principal amount of the 2019 Notes in the nine months ended September 30, 2016 in order to maximize interest savings by paying down our most expensive debt.
|
|
Twelve Months Ended September 30, 2017
|
|
Covenant Requirement at September 30, 2017
|
||
Maximum consolidated net leverage ratio (1)
|
3.71
|
|
|
5.375
|
|
Minimum interest coverage ratio
|
5.68
|
|
|
2.50
|
|
(1)
|
The maximum consolidated net leverage ratio is calculated as consolidated funded debt, net of unencumbered cash and cash equivalents in excess of $2.0 million (calculated at
$500.0 million
as of
September 30, 2017
, or
$500.3 million
of consolidated funded debt less
$0.3 million
of cash and cash equivalents in excess of $2.0 million as of
September 30, 2017
), divided by minimum consolidated EBITDA. Minimum consolidated EBITDA is based on operating results for the twelve months preceding the measurement date of
September 30, 2017
. Consolidated funded debt, net of unencumbered cash and cash equivalents in excess of $2.0 million, and minimum consolidated EBITDA are non-GAAP financial measures that should not be considered an alternative to any measure of financial performance calculated and presented in accordance with generally accepted accounting principles in the United States. A reconciliation of net cash provided by operating activities to minimum consolidated EBITDA is as follows (in millions):
|
|
Twelve Months Ended September 30, 2017
|
||
Net cash provided by operating activities
|
$
|
103.5
|
|
Changes in assets and liabilities, net of effects of acquisitions and divestitures
|
4.4
|
|
|
Gain on sale of property and equipment
|
0.1
|
|
|
Environmental remediation charge
|
(0.9
|
)
|
|
Loss on debt extinguishment
|
(13.5
|
)
|
|
Stock based compensation
|
(5.8
|
)
|
|
Southbridge Landfill non-cash charge
|
(63.5
|
)
|
|
Interest expense, less amortization of debt issuance costs and discount on long-term debt
|
25.5
|
|
|
Provision for income taxes, net of deferred taxes
|
0.3
|
|
|
Adjustments as allowed by the Credit Facility agreement
|
84.6
|
|
|
Minimum consolidated EBITDA
|
$
|
134.7
|
|
•
|
the volume of waste relating to C&D activities decreases substantially during the winter months in the northeastern United States; and
|
•
|
decreased tourism in Vermont, New Hampshire, Maine and eastern New York during the winter months tends to lower the volume of waste generated by commercial and restaurant customers, which is partially offset by increased volume from the ski industry.
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
|
|
|
|
||||
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Beginning balance
|
$
|
—
|
|
|
$
|
—
|
|
Accretion expense
|
—
|
|
|
—
|
|
||
Obligations incurred
|
6.4
|
|
|
—
|
|
||
Obligations settled (1)
|
(0.2
|
)
|
|
—
|
|
||
Ending balance
|
$
|
6.2
|
|
|
$
|
—
|
|
(1)
|
Includes amounts that are being processed through accounts payable as a part of our disbursement cycle.
|
|
|
|
|
||||
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Beginning balance
|
$
|
5.9
|
|
|
$
|
5.2
|
|
Obligations settled (1)
|
—
|
|
|
(0.3
|
)
|
||
Ending balance
|
$
|
5.9
|
|
|
$
|
4.9
|
|
(1)
|
Includes amounts that are being processed through accounts payable as a part of our disbursement cycle.
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 6.
|
EXHIBITS
|
10.1+
|
|
|
31.1 +
|
|
|
31.2 +
|
|
|
32.1 ++
|
|
|
32.2 ++
|
|
|
101.INS
|
|
XBRL Instance Document.**
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.**
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document.**
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document.**
|
101.PRE
|
|
XBRL Taxonomy Presentation Linkbase Document.**
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.**
|
**
|
|
Submitted Electronically Herewith. Attached as Exhibit 101 to this report are the following formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016, (ii) Consolidated Statements of Operations for the three and nine months ended September 30, 2017 and 2016, (iii) Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2017 and 2016, (iv) Consolidated Statement of Stockholders’ Deficit for the nine months ended September 30, 2017, (v) Consolidated Statements of Cash Flows for the nine months ended September 30, 2017 and 2016, and (vi) Notes to Consolidated Financial Statements.
|
+
|
|
Filed Herewith
|
++
|
|
Furnished Herewith
|
|
Casella Waste Systems, Inc.
|
|
|
|
|
Date: November 2, 2017
|
By: /s/ Christopher B. Heald
|
|
|
Christopher B. Heald
|
|
|
Vice President and Chief Accounting Officer
|
|
|
(Principal Accounting Officer)
|
|
|
|
|
Date: November 2, 2017
|
By: /s/ Edmond R. Coletta
|
|
|
Edmond R. Coletta
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
1 Year Casella Waste Systems Chart |
1 Month Casella Waste Systems Chart |
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