Exhibit 99.1
NEWS
REPUBLIC CONTACTS
Media Inquiries: Will Flower (954) 769-6392
Investor Inquiries: Tod Holmes (954) 769-2387
Ed Lang (954) 769-3591
REPUBLIC SERVICES, INC. REPORTS FIRST
QUARTER EARNINGS PER SHARE OF $0.32
[ ] FREE CASH FLOW ON TARGET
[ ] COMPANY REALIZING BENEFITS FROM
PRODUCTIVITY AND OPERATIONAL INITIATIVES
FORT LAUDERDALE, FL, APRIL 29, 2002...Republic Services, Inc. (NYSE: RSG) today
reported that first quarter revenue increased 3.1 percent to $551.9 million from
$535.4 million for the same period in 2001. Net income for the first quarter
increased 10.7 percent to $54.9 million, or $0.32 per share, compared to $49.6
million, or $0.29 per share, last year. Operating income for the first quarter
was $106.9 million, compared to $98.9 million for the same quarter last year.
EBITDA in the first quarter increased to $151.3 million, from $149.2 million for
the same period in 2001.
In the first quarter of 2002, the Company adopted Statement of Financial
Accounting Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS
142"). In accordance with SFAS 142, the Company ceased amortizing intangibles
with indefinite lives effective January 1, 2002. If SFAS 142 had been effective
January 1, 2001, net income for the first quarter of 2001 would have been $55.6
million, or $.32 per share.
Commenting on these results, James E. O'Connor, Chief Executive Officer of
Republic Services, said, "I am pleased with the Company's performance during the
quarter. While the economy is relatively unchanged from the fourth quarter, we
are beginning to realize the positive effects of the initiatives we started in
2001, especially in the areas of increasing route productivity and reducing
maintenance costs. During the quarter we generated free cash flow of $88 million
and our internal growth was 1.0%. I believe that this performance is consistent
with the guidance we provided in January of $1.37 to $1.39 earnings per share
for 2002."
Republic Services, Inc. is a leading provider of solid waste collection,
transfer and disposal services in the United States. The Company's operating
units are focused on providing solid waste services for commercial, industrial,
municipal and residential customers.
Certain statements and information included herein constitute "forward-looking
statements" within the meaning of the Federal Private Securities Litigation
Reform Act of 1995. Such forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual results,
performance, or achievements of the Company to be materially different from any
future results, performance, or achievements expressed or implied, in or by such
forward-looking statements. Such factors include, among other things, whether
the Company's estimates and assumptions concerning its selected balance sheet
accounts, closure and post-closure costs, available airspace, and projected
costs and expenses related to the Company's landfills and property, plant,
equipment, labor, fuel rates and economic and inflationary trends, turn out to
be correct or appropriate, and various factors that will impact the actual
business and financial performance of the Company such as competition and demand
for services in the solid waste industry; dependence on acquisitions for growth;
the Company's ability to manage growth; compliance with, and future changes in,
environmental regulations; the Company's ability to obtain approval from
regulatory agencies in connection with expansions at the Company's landfills;
the ability to obtain financing on acceptable terms to finance the Company's
operations and growth strategy and for the Company to operate within the
limitations imposed by financing arrangements; the ability of the Company to
repurchase common stock at prices that are accretive to earnings per share; the
Company's dependence on key personnel; general economic and market conditions
including, but not limited to, inflation and changes in commodity pricing, fuel,
labor and other variable costs that are generally not within the control of the
Company; dependence on large, long-term collection contracts; risks associated
with undisclosed liabilities of acquired businesses; risks associated with
pending legal proceedings; and other factors contained in the Company's filings
with the Securities and Exchange Commission.
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REPUBLIC SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
Three Months Ended March 31,
----------------------------
2002 2001
--------- ---------
Revenue $ 551.9 $ 535.4
Expenses:
Cost of operations 342.0 329.7
Depreciation, amortization and depletion 44.4 50.3
Selling, general and administrative 58.6 56.5
--------- ---------
Operating income 106.9 98.9
Interest expense, net (18.5) (20.2)
Other income (expense), net 0.1 1.3
--------- ---------
Income before income taxes 88.5 80.0
Provision for income taxes 33.6 30.4
--------- ---------
Net income $ 54.9 $ 49.6
========= =========
Reported basic and diluted earnings per share $ 0.32 $ 0.29
========= =========
Weighted average diluted common and common
equivalent shares outstanding 169.1 171.8
========= =========
EBITDA $ 151.3 $ 149.2
========= =========
Adjustments to net income and earnings per share as if SFAS 142 were adopted on
January 1, 2001:
Reported net income $ 54.9 $ 49.6
Goodwill amortization, net of tax -- 6.0
-------- --------
Adjusted net income $ 54.9 $ 55.6
======== ========
Reported basic and diluted earnings per share $ 0.32 $ 0.29
Goodwill amortization, net of tax -- 0.03
-------- --------
Adjusted basic and diluted earnings per share $ 0.32 $ 0.32
======== ========
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REPUBLIC SERVICES, INC.
SUPPLEMENTAL UNAUDITED FINANCIAL INFORMATION
The following information should be read in conjunction with the
Company's audited Consolidated Financial Statements and notes thereto appearing
in the Company's Form 10-K as of and for the year ended December 31, 2001.
CASH FLOW
The following table reflects certain components of the Company's
unaudited consolidated statements of cash flows for the three months ended March
31, 2002 and 2001 (in millions):
Three months ended
March 31,
------------------------
2002 2001
----------- --------
Depreciation, amortization and
depletion of property and equipment $ 42.1 $ 39.3
Amortization of intangible assets $ 2.3 $ 11.0
Capital expenditures $ (37.6) $ (39.2)
The Company defines free cash flow as net income plus depreciation,
amortization and depletion less capital expenditures plus net changes in assets
and liabilities resulting from operating activities. This simple definition
excludes certain commonly used elements of free cash flow such as deferred taxes
and proceeds from the sale of equipment.
During the first quarter of 2002, the Company adopted Statement of
Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets"
("SFAS 142"). In accordance with SFAS 142, the Company ceased amortizing
intangibles with indefinite lives effective January 1, 2002. If SFAS 142 had
been effective January 1, 2001, amortization of intangible assets for the first
quarter of 2001 would have been $1.4 million.
Capital expenditures include $.4 million and $.3 million of capitalized
interest for the three months ended March 31, 2002 and 2001, respectively.
As of March 31, 2002, accounts receivable were $224.0 million, net of
allowance for doubtful accounts of $19.2 million, resulting in days sales
outstanding of approximately 37 (or 24 days net of deferred revenue).
STOCK REPURCHASE PROGRAM
During the three months ended March 31, 2002, the Company paid $46.5
million to repurchase 2,684,300 shares of its stock. As of March 31, 2002, the
Company had repurchased 11,897,900 shares of its stock for $196.6 million and
had $78.4 million remaining under its repurchase programs to fund stock
repurchases.
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REVENUE
The following table reflects total revenue of the Company by revenue
source for the three months ended March 31, 2002 and 2001 (in millions):
Three months ended
March 31,
-------------------------
2002 2001
-------- --------
Collection:
Residential $ 124.6 $ 113.1
Commercial 171.1 168.6
Industrial 117.9 122.4
Other 12.1 11.3
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Total collection 425.7 415.4
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Transfer and disposal 187.1 175.2
Less: Intercompany (97.3) (93.5)
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Transfer and disposal, net 89.8 81.7
Other 36.4 38.3
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Total revenue $ 551.9 $ 535.4
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The following table reflects the Company's revenue growth for the three
months ended March 31, 2002 and 2001:
Three months ended
March 31,
-----------------------
2002 2001
---- ----
Price 1.0% 1.4%
Volume -- 2.1
---- ----
Total internal growth 1.0 3.5
Acquisitions 2.1 3.3
---- ----
Total revenue growth 3.1% 6.8%
==== ====
Price growth for the three months ended March 31, 2002 was impacted by
declining commodity prices. Excluding the negative effect of commodity prices,
price growth was 1.3%. In addition, non-core operations increased volume growth
during the three months ended March 31, 2002. Excluding the positive impact of
non-core operations, volume growth was (.4%) for the three months ended March
31, 2002. As such, adjusted internal growth for the three months ended March 31,
2002 was .9%.
Price growth for the three months ended March 31, 2001 was impacted by
declining commodity prices. Excluding the negative effect of commodity prices,
price growth and adjusted internal growth were 2.2% and 4.3% for the three
months ended March 31, 2001, respectively.
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