Waste Management (WM) 26 Oct 172017 Q3 Earnings call transcript

Company Profile

Participants

Ed Egl	Waste Management, Inc.
James C. Fish, Jr.	Waste Management, Inc.
James E. Trevathan	Waste Management, Inc.
Devina A. Rankin	Waste Management, Inc.
Derrick Laton	Goldman Sachs & Co. LLC
Hamzah Mazari	Macquarie Capital (NYSE:USA), Inc.
Michael E. Hoffman	Stifel, Nicolaus & Co., Inc.
Patrick Tyler Brown	Raymond James & Associates, Inc.
Jeffrey Marc Silber	BMO Capital Markets (United States)
Corey Greendale	First Analysis Securities Corp.
Noah Kaye	Oppenheimer & Co., Inc.
Michael Feniger	Bank of America Merrill Lynch
Barbara Noverini	Morningstar, Inc. (Research)

Call transcript

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Operator

Good day, ladies and gentlemen and welcome to the Waste Management Third Quarter 2017 Earnings Release Conference Call. At this time participants are in a listen-only mode. Later we'll have a question-and-answer session and instructions will be given at that time.

As a reminder, this conference call is being recorded. I would now like to turn the call over to your host for today, Ed Egl, Director of Investor Relations. begin. may you Sir,

Ed Egl

Chief Good Rankin, our and conference third morning Financial Operating President me Nova. Vice Trevathan, joining and Officer. Vice President call. you President us this Chief and Fish, Jim for quarter and are Officer; morning, you, Jim thank Executive Devina everyone, Officer; for With Executive Senior Thank XXXX Chief earnings and

strategic Jim overview. hear overview. comments the Trevathan provide and from Fish today. will financials. prepared them financials and cover of will details price You provide And cover of a Jim will details cover and high-level our each the Devina volume will operating an

get The schedule to X-K available press and filed we is the Before that Form that release, our and press please a this at website important X-K, release we on Form include information. the www.wm.com. have includes started, the note morning the release press earnings

you projections differ and based could forward-looking call to risk actual statements, uncertainties the about hear statements subject are Such to results opinions periods. or cause which will are During expectations, materially. that current on future

volume. our our areas of recent and and uncertainties specifically are All including basis. and or otherwise or in volume of XX-K. on discussed Form Some references results discussed discuss our in filings workday unless from yield adjusted these more the IRG results and stated, Jim the to yield are volume, SEC, which, today's growth internal revenue a will press Jim with in are risks release most

comparisons time Earnings and in operating comparison share, earnings to may certain rate cash which non-GAAP results Devina items EBITDA of with together margin, operations. earnings to believes footnote measures and EPS free refer tax replay to the additional enter occurring in the will that consent Please of any diluted is form on to code recorded at on today information the of available the Time Internet, call Management and being comparable XX written telephonic approximately and dial provided no on access This during a XXXXXXXX. beginning www.wm.com. Waste release performance Jim, and earnings which from is longer replay. Management or these and reconciliations To do for Eastern PM call, of flow per found day rebroadcast call, the unless they hear margin, the this per per prohibited. adjusted the at XXXX. measure. be stated company's or November www.wm.com of will over Any and operations refer replay quarter fundamental These redistribution, Jim, with our at X:XX a as margin call may press reflect be be without expense discuss of have call, most PM otherwise a is the reservation hours the schedules, Time and third the X:XX a and retransmission Waste or business hear effective measures, operating income During X. share. accurate today's GAAP Any will website adjusted Eastern to October management XXX-XXX-XXXX be which until been are To express XXXX, website information exclude not XX, can share, of Time-sensitive the call measures.

to over Now, and Management's call Waste Fish. the turn I'll President CEO, Jim

James C. Fish, Jr.

best quarter improving its our had quarter has price, all operating our focus morning. customers, employees Management biggest of arguably In for a two profitable to volume areas you Waste by us servicing thank where and joining on maintained and core were history. hurricanes, in impacted heavily our Ed, produce growing their controlling Thanks, this costs the

record free cash taxes Devina This is operating about billion a EBITDA. upon we our detail. free and cash compared quarter discuss spending. comparative at will performance of quarter of our flow when $X.XXX full in grew to our operating cash the conversion our nine free paid more to guidance. And in of in an period, the to increase second for cash result, flow by almost flow rate capital the flow the grew third of raising strong than X% months a first translate EBITDA XX%. The quarter But cash XX% same based are through year, as EBITDA XXXX. despite continued operating consecutive Our year into the the

third X.X% was range that billion the $X.X of quarter guidance new billion, $X.XX generated to $X.X EPS third number of expiration billion billion. XXXX. a EPS to to $X.XX hurricanes headwinds, impact of these quarter, Despite the $X.XX drag the a we the is and $X.X up $X.XX from when Our increase compared fuel from an In third of in We $X.XX XXXX. from grew and by Harvey of of negative EPS credits. versus $X.XX quarter tax Irma

year share. our diluted are XXXX earnings of we Given per guidance earnings adjusted full strong raising our performance,

$X.XX $X.XX. $X.XX, is from range $X.XX guidance new to to Our up

we solid revenue driven EPS, in As flow and in quarter, our by growth free was the income. strong operating saw in cash and growth second EBITDA

Our The revenues waste majority and traditional was grew yield our by growth volume $XXX revenue business. growth from solid of million the in or X.X%.

to growth. the our addition, recycling of contributed In line revenue business million $XX

by pricing was our was full X.X% price third and price We year as to our disciplined to collection our X%. quarter, core core continuing disposal continue the target. focus and In on exceed demonstrated yield

XX and strong Our points. growing operations X.X% led improving from operations to basis margin pricing income from income

was of pressure On solid in quarter started late the we price front, the commodity quarter. to see recycling in third spite the

to per XXXX. share more of little Our the recycling earnings grew when compared $X.XX a quarter third than

were for on where continue strong primarily Florida, Texas recycling year-over-year, to impacted quarter, volume our up side, of due suspended. and to we the customers' hurricanes the temporarily XX.X% in of most the some be remained prices programs While

announced Trade that are Organization we've early impact our in XXXX. July, fourth and that beginning As results China the going China World were they seven in import from X.X%. materials sold issues the could years ban quarter XX the in that In result, in third MRF to level to several the part at were recycled of XXXX. into lowest declined a quarter tons tons and recycling September seen There

processors import However, is in a recycled we Management that licenses industry has mill ban large expected put and to In government us the for that the bind of not China recycled export this our issuing impact this customers such have China. informed global was minimal and given Chinese as the to cardboard. materials newsprint customer has world Since the September, materials Waste been additional recycling a forced around a our materials, expertise relationships, we've service materials is alternative day. processed of global this disruption. customers' markets I'm received been every for offering MRFs customers. business. have further to markets collect been say materials proud And recycling a to not key that outside leverage Thanks the able at alternative a find to and we group's warehoused China or our recycling Recycling for to to of our landfilled result and our as de-risk to

month seen the year-over-year of and $X.XX October pricing a has For in significant we a quarter recycling negative basis. expect the drop fourth operations impact now a from the on quarter, our in

conditions, to to not when the heavily year. at $X.XX in current the expect in we typically XXXX a low compared to do half while normal this expect not guidance pricing become see market we would in XXXX give a weighted decline first we October and XXXX, to based recycling However, of the time, new upon earnings

update quarter worked sound to will ensure and to fluctuate These has we strong will team and and model recycling when give invested guidance market capital. return earnings our continue business that fourth we Our to continue we evolve hard XXXX our have generate on business on a call. conditions assumptions

more Company we Digital for efficient the to today. role As affords Chief Nikolaj are share year-over-year nine that spent we to to for a components To leader firm have is and To waste the using Management, with it our impressive than the is new we've important in-depth in previous Compaq and an the customers us and that years he do Waste of digital tremendous business all developed business. Nikolaj traditional to very announce operations. we us performed opportunities Vice five data, with tools new years. Sjoqvist needs company-wide our an during doubt on a well grow no six use be strategy. in And with we've business, and been of which calls, important I coming pleased journey. of technology been make XX live President we've The knowledge Officer. in years sum mentioned for months us looking it earnings digital to end, their McKinsey on our Nikolaj this right has function. of $X.XX all diluted of the per Management He HP. of systems believer position XXXX. of Revenue I'm he delivered which in that quarter, meet of promoted Prior has and our us easier of our that platforms customer era and our very take strategic to will business, up, our first held insights, to and solid make customers, third improvement leader analytics

Jim impact anticipated deliver turn from the into an that quarter are our I now and operating diluted to We're our strong share quarter operations, guidance. will in will continue per raising $X.XX our call despite results full-year discuss more quarter, to to results over negative our fourth the detail. employees recycling into Looking the confident fourth we third in XXXX.

James E. Trevathan

to and from good operations and EBITDA X%. company more growth. million, operations our total fundamentals and positive increase than morning. The growing continue of drive $XX combined The strategy led price operating Thanks, an income of positive to volume from Jim income

$XX operating quarter quarter third of when grew $X.XX increase $XXX of compared X.X% of quarter last year. the of to third increase basis million points XXXX. or XXXX. when X%, were about billion, of to an Revenues And was third compared in margin the XX when increase EBITDA operating our Our an to an compared the EBITDA XX.X%, million,

of $XX Third volume million. collection quarter combined price our disposal was revenue the and from and impact business in growth

million collection In drove recycling X.X% recycling disposal and revenues from yield core X%. and quarter, revenues. quarter also increase benefited Third price was third higher a our the prices, in was commodity which $XX

up was waste volume On X%. the volume and front, traditional total volume X.X% was solid

national in of year-over-year of we became line large the accounts. as the the quarter anniversaried we've third award several in commercial As the expected, business comparison tougher

as are and addition, Jim focus results achieved we results. headwinds, and disciplined Through from growth hurricanes. our we about given Overall, our months with the very volume we're first volume. the and customer recycling weaker X% nine on consistent pleased year, service yield of as saw X% delivering volume these In mentioned, the

decreases increases other XXth for rollbacks was X.X% rate churn metrics, year-to-date improved the at our points service Looking exceeded quarter, revenue year-over-year. and basis service consecutive XXX

margin. the commercial quarter, income was $XX growing business million. third from and quarter, volume volume of of business waste point with grew volume core volume collection from X% price X.X%, C&D down lines Industrial produced core generating grew increased combined perform was Those and residential the results and volume led exceptionally to collection margin grew well. improvement growing price revenue and operations the total in MSW the line EBITDA business, while cover the up business, million core almost Our operating XX second increase basis In similar in was third line operations to basis to In quarter. X% $XX price X.X%. point the in price in the operating up in was landfill continued and of X.X% with volume XXX X.X% quarter. an residential In X%. X.X%, third EBITDA income line The our volume special of volume X.X% a combined XX.X%, increases

at jobs not up did waste, that, benefit outage continue an pipeline several volumes continues adjusting but to repeat XXXX still large On had but in for front, the single-digits. the would we In Waste-to-Energy good. in our to be a mid-to-high MSW look Plant, from Virginia we special that

XX% these price to of growing in in that by improvement pricing, volume seen from income in total achieved operations the led nine quarter This metrics. The $XX core compared of at both positive MSW XXXX. pricing and consecutive price highest third of we've operating million, we improved yield Regarding is years growing the third combined to X.X% the line landfill of and $XX the each quarter X.X%. million these we and of EBITDA was of positive measures business

increased from XXX income landfill line and the saw margin margin operating points also in basis XXX points. We EBITDA increase operations basis

to higher our to quarter, in expenses. recycled now the rebates, compared related commodity operating operating total rising to Moving third of fuel cost increases were recycling primarily increased cost XXXX. increase expenses, million, the with due quarter and $XX The third brokerage largely when business

points quarter points revenue, Our fuel recycling basis third XX.X% XX revenue. operating XXXX the of a expenses expenses as the of combined quarter as XX.X% a percentage The increased in in higher rebates cost XX XXXX. of to of third from and of percent improved basis

gains, and efforts, hurricanes' in lines, particularly the business, which particularly cost notable the based efficiency than disposal quarter, our through to solid our However, control commodity waste is and given costs in we were labor cost. able cost our transfer and that in the operating more increase in on traditional impact offset

Our revenue during to to I'll of the our waste corporate results. teams. to by as strong business quarter. expenses turn traditional a solid the Devina and And of improved the our Thanks discuss operating points over XXX call our financial basis now execution percent field

Devina A. Rankin

everyone. Thanks, Jim, good and morning,

significant of from drive growth free flow. cash operating the year, all seen to and continues operations our results have we as flow in strength cash Just our

XXXX, the operating to in fact, that of million million. and $XXX highest ever $XXX cash activities by million quarter almost or third In achieved in third we quarter seen provided an $XX increase This we of XX%. have the XXXX that's the at of compares

from continued of with point a a from cash the we was XX% achieving our in quarter, third our metrics. basis flow In are XXXX. operating cash is the which are conversion leverage as revenue measure improvement quarter operations particularly We flow pleased of the the third XXX percentage in

and margin contributed as flow $XX These in we in results the seeing was to that of cash quarter. operating growth about EBITDA our free are business cash operations percentage and Our million from demonstrate XX%. EBITDA operating the a expansion

more the third offsetting on than also working focus performance quarter impact of diligent capital Our efficient cash management benefited more the taxes. higher

in pay our and field leverage capital pay value year conversion efficient been to resulting corporate provide real working last the and continued of metrics. X%. about process have spending days extension the to cash to third increased and our more expansion procure the teams Over our In a quarter, to

shareholders billion. Jim billion flow returning we cash through of million mentioned, raising flow free cash strong are funding of expenditures be to of million between increase free months flow We the and quarter business expect quarter quarter over $X.X quarter, our generated and from free of we supports billion the remainder to capital And cash the of by third the $X.X year. now third increase we into be billion. our agreement the of third as an XX% XXXX, in we to our flow. the on and $XX our have Through cash an share at our to of the $X.X expect fourth more our first $XXX of and nine the free of in generated over pronounced guidance even entered we In year, the year-over-year $X.X dividends or XXXX. The billion million the of the and guidance generate year growing repurchases, outstanding and $XXX to focus upper-end between repurchase stock We acquisitions. consistent $X.XX value full

in We acquisitions. free we target our dividends identify we Each our of bring financial spending fully we million to the of year business will and in the to million first between will on fourth how acquisition our $XXX and the Through acquisitions. begin returned $X.X our year. tuck-in flow full to to time performance additional we have over for We on $XX in which review the million cash and consider expect year. million we quarter, this year $XXX coming the paid allocate acquisitions also around continued months shareholders spent the and to nine have billion $XXX year, the and close of fund

made billion change grow generation cash a years, discussed free had and baseline step our of baseline ago dividend. we target we As to $X.X to the cash $X.X baseline billion, corresponding that to we deliver and years for a new Two a $X.X billion the we will flow dividend we $X.X have as new billion grows. many moved of flow of of in business from that a communicated

that the last billion. are company's increased, $X.X the we strength baseline has of again now confident over years, two cash free to flow flow cash operating With the

capital step new yet our well this Directors While in recommend finalize in to the per plan, of to flow year's baseline have a allocation change positions free dividend beginning we us to the Board cash coming corresponding share XXXX.

Turning to SG&A.

quarter costs the X.X%. third For or quarter of XXXX XXXX were the in percent the SG&A of as third revenue, year dollar basis, million of SG&A a than were a in $XX prior period. On million higher costs $XXX

quarter compensation that largely the increase quarter to year and recovery a benefited favorable incentive third increases is The prior attributable from cost. insurance

We quarter serve. in percentage charitable will for our impacted year. wake We that of donations the that confident communities SG&A remain we the increased some approach of cost Texas in we had cost Florida the hurricanes a revenue also for that XX% made and the the as of

Our debt-to-EBITDA on right ratio, to acquisitions strength underscoring end we the third of in our based quarter, bank and our sheet at covenants the well strategic price. at the at X.X remained make measured balance the positioned remain

Our tax slightly of for XX.X%, about projected effective is third XX.X%. tax year XXXX approximately XXXX below adjusted which rate was the rate of our full adjusted quarter

of adjustments the very XXXX. year-over-year our In performed months the rate is benefit and increase growth included and through return XXXX credits. about of was benefits $X.XX pre-tax quarter have Our XX.X% to in earnings the The we from tax third which these is our in change well due a to adjusted rate the in summary, tax of meeting tax favorable nine accrual from first for adjustments. XXXX

at core volumes, execute improving and thank high want to and our the customers, a With all know let's price We work our Nova, team. to the fantastic in and I costs. core questions. objectives, serving to deliver on continue profitable controlling operating line the have best Waste employees growing I for quarter industry they a in Management the preparing results of open are members hard they XXXX. on the for fourth at great continuing that, level

Operator

you. Thank

of Our Maguire first from Goldman line of the Brian comes Sachs. question

Derrick Laton

Derrick for Hey, Brian. on Laton good guys. morning, It's

James C. Fish, Jr.

Hi, Derrick.

Derrick Laton

Thanks for taking my question.

forward Just couple now, EBITDA should percentage million there, imply strong to the fourth quarter. flow How $XXX at as you'd $XXX million, of last kind free going revised I in maybe free flow have looking looking XXXX? it about the think, at of free flow the just we think cash that, conversion's cash cash and look would guidance quarters been in we the a ahead as

Devina A. Rankin

It's actually to us you early seen that we operating quarter EBITDA giving the XXXX. our tick expenditures fourth thus XXXX, as down flow should the right of and full bit free that a mentioned what for as our far the saw capital year about will for result, going in that given to quarter guidance percentage consider leverage What than from seen expect higher what a business. I little maybe the are range now as higher in the same is be And a in in in XXXX. be we've EBITDA cash a fourth we've

Derrick Laton

And kind to or begin is to normalize recycle return then decline more to thoughts if expecting your maybe is XXXX, to the $X.XX material? just about find and for the China heard based recycling dispositions based that on kind you're of is things commodities that helpful. of shifting that said is your commodities earnings half heavily think will That's first your that alternative and there weighted recovery in going to a in Okay. on more year. correctly maybe year-over-year recycle prices, gears I'm some ability implies assuming in you I the of to recycling, I a market

James C. Fish, Jr.

July. with above. pricing. this, by was that I at that's and The we XX% is about so commodity OCC most pricing it's is OCC September think looked OCC the of we up $X.XX the September – came way the from pricing September been the all peaks and pricing, in export down impacted

that's XXXX, OCC said, from decline $X.XX in a pricing build that X% OCC QX the to earnings pricing, So reasonable which a felt the and up us export us to saw export to about it at number we look we decline of another at and recycle about there used took in for we XXXX. same puts

James E. Trevathan

activity. seeing here China licenses answer, Derrick, this, I need mills. that to has shipments their we're well. delivered preparing there's specific add and are e-commerce now. more QX a need in door to being we're to granted and know as that orders to day all growing on Their a more the few more might mills We based for product probably and product. There every my products front yours

years that our it's happen. at in that here right requirements, you see the years and pricing we rate at primarily quality point but seeing in materials. years activity we that looking around in five summer to Derrick, for now starting sure that have they're Asia the inspecting, receive the approval not saw only shipments their we're inspectors So, for but now, QX. the question, so same four I the been and mentioned guess a markets in low happening in developed India or their to and they've that Not granting lastly, in your for or material, they're above Southeast meet making other spring, is at then, And as few activity. now, we plants

think doing long and term. the at truly to need term. that term for we've that they we well we're we I us as – get done finding us short ways bodes requires the shipping so what I find think short that's we what markets Granted, for that to and business to around alternative as helping China's brokerage the and to but well is alternatives, large mean But don't them, think doing. in numbers Our They're Jim material look imply blip we looking also you. gave that they're we're

James C. Fish, Jr.

the said, that think, into baseline see, I we there November. don't lows Jim we're use, coming reinforces right feel starting to Jim's are the already October why I think color as Derrick, promising Well, some that to signs

Derrick Laton

prices basis, recycle an roughly sensitivity just you is the is to move same guys then final there, for color guys. on me, one annual on for annual a it commodities the $XX And impact to the confirm, Appreciate an $X.XX basis? one for Great. still just

James C. Fish, Jr.

same used. number we the that's Yeah,

Derrick Laton

Great. right. Thank All guys. I'll over. turn you, it

Operator

from of next the of Hamzah Capital. line question comes Mazari Macquarie Our

Your is you. Good - Capital Hey. Mazari Hamzah Macquarie line open. Inc. morning. (USA), Thank

is question cash flow. just free on first The

base, with is in dividend? mentioned it that just You conjunction a the should does in larger change to dividend. the about $X.X what the change we is change view that think flow step with or that M&A a step billion the catch-up – then, Is And your cash the free that in step just dividend in that, change on given to your baseline? new regard

Devina A. Rankin

Sure.

what proceeds new that is current our year, So Hamzah, I billion the is for divestitures. because $X.X say, of varies the would the of baseline that outlook and from current impact from

As out a not we in the predictable, we recurring because $XX are million easily divestitures from that's that that's flow include million to free activity cash projecting. our measure, current but $XXX backed year we've proceeds reminder, activity of

we board a operating December. business. billion the look ratio to the capital in XX% about flow really cash dividend when a cash target leverage flow using forward that long-term, will the in grow over we expect as free $X.X of with on our basis we're grows policy, about discussion And from the consistent So and a payout the allocation as baseline think free dividend we

billion on data of the which of flow cash the baseline existing that's you $X.X at of use look point or XX% moving billion billion, $X.X depending previous billion $X.X to $X.X $X.X we free X.X% baseline from to – when so, an to billion. to the And increase

allocation So to that detail the the step are we has December confident we'll in at baseline what billion. is. determining know and be that board capital with that looking appropriate think in the change we increased our more $X.X But

that balance is XXXX just no Hamzah confident Mazari the then how execute Maybe strategic (USA), operational to little execution Macquarie this that better side if - but feels sustainability curious performance. since be I activity Capital you M&A know, touched a to highest outlook sheet Great. just in have and gross level landfill continue our much that like just you for acquisition that. for out the on of It Inc. on you And large bit on changes margin. and guys. versus also We Jim high we parse the of mix the just could cost way

James C. Fish, Jr.

last at think, that margins, And look good it story the still certainly But quarter we talked business dampening you we I us mean to that I were was at and this our whether you was EBITDA (XX:XX), just when a we for something this quarter. look overcome or adds about – margins brokerage gross bit it a it did. quarter. able

it We've EBITDA think line right points being is finish in sustainable the range points we to basis margins be talked year-over-year that I about, on forward. going we'll basis XXXX. XX think XXX we up and when

his, in that that have into I well, focus – Jim mentioned hers, continue to we or I in mentioned We costs place. and some technology script think, in operating it, on Devina – we're in my and putting that think, I

so. showing really, there then, up our focused, that that And computers spades focused Devina, at it's an have finally our improving and We've onboard continually in It's couple really the see and our I year – volume. although is last gains. there, would mentioned price operating are in able we're We I leverage something I thing costs we strides. in also six mentioned with and is in our on good know and there, through through made period over it's area we really EBITDA results kind free X% that Hamzah, not years five only been we're X% say, efficiency think last times over that gotten the to quite margins. of least of a SG&A margins, we Steiner that years pleased we're the starting cash but never were affecting get flow, and the to several to seeing is and that what always

James E. Trevathan

of Jim you look have or leveraged you well, in price in yield, at, if of and of slowing in over. It's lot both see as signs lines it. mentioned two Hamzah, really margin I'll model. business, as Got the commercial Macquarie the and a turn highly don't Hamzah line in in and a of expansion created Capital business growth that that business core line and Inc. the that landfill have it solid see down lastly, future. Mazari I of volume business the just And (USA), - we

term the cleanup any General cleanup same investors feels lot on long in probe hurricanes. the stuff, Texas the puts activity It activity. takes Attorney look this of you or should was and private from a comparing other versus there look but the Andrew hurricane, when are at like at Hurricane some have of what a pickup time, As you

Just curious, you side benefit term Thank landfill to XXXX you. on there? on this big going long your and a is be in thoughts the just curious for

James C. Fish, Jr.

Yeah.

debris as what and off reason Houston for terms to lot terms of I'll I – these In and that be Hurricane benefit XXXX, us of assume there was difficult And of hurricanes. temporary it's about us. as it's QX for to example or people's that of it gone areas. a to of in I first that a all, Here's predicting a for the will benefit it's to of the in whether mean, But first example, get the Texas part I would bit benefit say in that they why has could. give quickly you an hard. yards specifically, holding the of predicting

we coming is business. the our we some in script, Where debris the part The collection there disasters just side. of way of to handled be a of we little see we so - a my a $X.XX lot of And a saw recycling Great. a most so a could is mentioned as and sure lot it's the landfills little because see this, then To in from really programs could we whole I a kind the cap probably it's Hamzah reconstruction exactly don't its hard by and of made yet predict we landfills. then opportunity. that the business Inc. bit the over ultimately to how for FEMA but collection of but a we in we're or for that somewhere volume side be line benefit, somewhere higher, through begins, either think lot. of roll-off So the the neighborhood neighborhood probably impact not (USA), Macquarie real on bit has business. the temporary a think in Texas, see Florida Capital Hamzah, out once is of suspension in there a us, in bit is on months. benefit it much And line in bit it Mazari Thanks natural not lower, in think put recycle $X.XX

James C. Fish, Jr.

Yes.

Operator

from comes Stifel. Hoffman Our of next question line Michael of the

Michael E. Hoffman

drawing of why Ed, out you my this drew context significance, taking sort you all out tell this point a for made us Thank this the of workday the preamble? questions can you in of morning. you time that

Ed Egl

volume. year-over-year we workday the difference on had $X.XX So, volume, of

if it it that X.X% positive you workday, the as-reported adjusted at to shows positive, volumes, look volume for for So, down shows X.X% quarter.

James E. Trevathan

That's total volume, (XX:XX). Ed

Ed Egl

total traditional on so That's volume for waste – solid X%. it's

it's to hasn't show – really that the you volume change just So significant. been

we still is significant we've you year. a that If drop, it look steady like but raw volume numbers, see the just looks seen all there the at

James E. Trevathan

called out. always we've that But that

Michael E. Hoffman

Okay.

James C. Fish, Jr.

We've Yeah. that. done always

James E. Trevathan

Yeah.

Michael E. Hoffman

then an again, this then had do you the July enormous Jim your free was raised Because you change in is and to it over this would if all Fish, And knew? cash guidance what three months. have you on flow, given actually

James C. Fish, Jr.

anticipate you can other you to that's the want happened don't out throughout and it's this what time because raised that we've look, to – but not direction. waited let's is halfway every year it, quarter I the and think raise we've then ever guidance felt in caused we the coming, we do in year, things the we're guidance third do see find didn't something like past, something the until happen July, Look, that or didn't through – that your

why we mean, third quarter question conservative, reaffirm we're So by of but in answer I earnings guidance we of One saying being things. is, two we wait your I year raising having kind a knew that, QX. when interest in second our until we really the were wanted quarter and that's on would to reasonably were good call, to

Devina A. Rankin

through XXXX working you that, capital really to difficult And procure as that still I seen in to know, that seen capital initiatives there. improvements to that we're are in would and traction of is pay we've some related anticipate and that to working predict the some the we didn't the add working changes processes Michael, we've strength and

And wanted of drivers, our six guidance. higher because consistent to in in so, and rather to seen in year, than has EBITDA sure the we've particularly swap growth, couple the remainder line outperforming The are was the be had the growth compensation over cash over continue, first predict reflecting our particularly going the with what plans. of that a we we remainder that come earnings we in with a the with traction expected we're of expectations way updated that's had months that discussed we capital working and incentive flow headwinds termination the

James C. Fish, Jr.

Devina's when just two think, Michael, but the to put behind procure landfill tag I this – really from those operations. to capital the to is pay capital October. story the have also it's EBITDA into it board, and Devina of and about volumes strong on and to and a or volumes volumes, cash working And mentioned, we that the Really, reasons as at – continue really working month we things comments. program, Yeah, place, landfill volumes look technology our across the overall strong comes

Michael E. Hoffman

Okay.

million to two. original we're $XXX and working $X.X you're $XX billion, $XXX million with EBITDA? So million billion going it's million in billion, parse that's how that $XXX $X.XX to break between to up then if I that, a to $XXX starting move, $X.X million the Is it do in capital to billion the to $X.X

Devina A. Rankin

$X.X now we in We growth. at $X.X gave EBITDA of to think that included range, even guidance cash range year-over-year that neighborhood $XXX billion when million high million EBITDA of billion free the a end growth So, end the the we're of flow and million that in thinking $XXX million to $XXX of $XXX more that in on potentially to of above high basis.

part of your that's increase. So

paid seen have working in decreases and than to remainder cash the in capital. the expected change also interest our then related We is better

Michael E. Hoffman

Okay.

– again? that say So is there to parse

James C. Fish, Jr.

say, just to we'd CapEx I said that. at it was guided of end billion original be end going last $X.X the I high said the high We would, and comes is in quarter we the originally believe right billion, of which we guidance. $X.X where

in going end high the at that of right we're come CapEx to so number. And

Michael E. Hoffman

Right, right.

that's take $XXX I million to million, is and the the $XX midpoint, $XX million, $XXX million. if So, $XX cash million interest parse

talking think that's way about So we're million – $XXX to still capital, to it? that's about $XXX million the is working

Devina A. Rankin

That's right.

Michael E. Hoffman

Okay.

And number? – so clear that and then in to no congratulations leverage – there be storm debris is

Devina A. Rankin

That's correct.

James C. Fish, Jr.

in there cost I when kind you almost revenue the on debris, you the for quarter third is consider quarter and to both negative impact that's was you and mean, that at through of only storm impact that QX. but $X.XX at There quarter, $X.XX SG&A operating the $X.X get hit that million I kind you was you amazing, our on surprising for The for Michael, QX third of the look initial a to and get and that third for third million and an if donations where and cost. the it's expectations from operating But seems quarter isn't. look the went add the beyond. million $X the and really the not impact if revenue

Michael E. Hoffman

Right.

your because million of very $X – related did that storm that you costs P&L $X XQ? storm made donation, in in nice total your related million are So,

James C. Fish, Jr.

$X million. million. Yeah, less a million. $X $X About than little bit

Michael E. Hoffman

right. All then – Okay. And okay.

me with baseline? baseline non-recurring imply would to you're $XX in billion that way then about thinking it there about why because million is billion isn't $X.X So, your $X.X help million the instead of $XX of

Devina A. Rankin

Right.

contributions ground million working the see remainder, The we capital wanting the term. more from with the growth sustainability with $XX would the $XXX just you, tell to and of a about to time in stake So, I has of associated uncertainty proceeds we capital over to divestitures. long million do before working put the to talked with respect

reminder, these changes from give see lift. They working step we capital going one-time provide don't initiatives forward. you year-over-year really As lift that a a

percentage XX% and Now as new conversion expectation years. to cash we're on our continue rate of sustain prior as up these like this plan, continue to in we going free that's XX%, a see at our from the XX% revenue flow more absolutely to of

Michael E. Hoffman

Of you're to? what cash flow that's from ops, referring

Devina A. Rankin

Yes.

Michael E. Hoffman

Right.

long-term a you've that? XX% the which through, been conversion EBITDA. circling XXs that your that's is possibly So, of of translate your other to that the have been of if couple The not is, like periods that's seems way but cash sustainable, sort about I the last free – as running XX% that flow think

Devina A. Rankin

Yeah.

the that expect we revenue typically to to of the we business higher run in now, or through capital I full-year right the earlier, of current break the going percentage expenditures with as mentioned a you XX% we've CapEx for I XXXX. X% tell of year given higher traditional revenue. As XX% the we're growth, would expect that on that

real Angeles next contracts growth the years. when particularly if think capital thinking over we've so, you to that investing now that the calls, And years, in about is Los we're XX last XX over the of several York the business, about provide going about and New value, the spoken

we capital percentage than something this the point. we is little expected, rate run at so traditional being a expect be to a And revenue something over as sustained that of the higher but that our it's long-term not

Michael E. Hoffman

Okay.

put cash as XX%, XX% XXXX, cash a pieces back cash ops revenues? XX%, runs think percentage goes you at in should you to is as which going about, in together, the to flow flow all to just that a percentage, those flow low-teens So from CapEx a of put X% as to free to

Devina A. Rankin

correct. That's

James C. Fish, Jr.

Pretty soon here XXXX. you're guidance into giving going to talk us for

Devina A. Rankin

Yeah.

Michael E. Hoffman

Well... Yeah.

James C. Fish, Jr.

(XX:XX).

Michael E. Hoffman

I'm to to – then a and question described or of the interrupt, don't lift pause biggest in but another brilliant, trying in you The am mean I That's apologize. all you things just The and it billion I in $X.XX understand. $X.X can XXXX? because billion grow what I XXXX

James C. Fish, Jr.

of feel the we're growth line. seeing that the EBITDA. we operating think X% I X% good we here's in to kind good business. look, leverage bottom mean, I feel I volumes feel very the about of we're the – think, that I about We mean and Yeah, seeing the

a bit because in we CapEx a fleet, payback our don't truck we're also we did cost the of a wouldn't is cost. She But be CNG more was of I to a a in investing diesel thing One why. control only a versus but heavily seeing in do. bit CNG very maintenance for talked terms XXXX. say mention it, that mentioned, a she fuel, may truck X% of nice implies in we Devina – wildcard not may that or not because XX% that range As about

So I more we'll good think will for XXXX, of business be the growth of cash the where feel prospects long-term we think, the we to get free year. about beginning quarter talk and we the next about when

Michael E. Hoffman

plus that me, mantra been for X% Okay. we into X% X% Two going today? hold last price, know do XXXX, ones your X% volume, we has forever, everything

James C. Fish, Jr.

looking So, for. we're far that's what

Michael E. Hoffman

And buying lower which of program you lot a then as of throughout money average consistently instead the maybe that on year? backs it make bankers opposed lot and whole money somebody not more investment to your buy makes get doing of price, do, year doing you a why shareholders all stock Okay. the ratably but a that of

Devina A. Rankin

the over ensure $XXX this I What we Michael. of executed would that hear that you, through The share our we will third the million year. you quarter I structure the year. are way December agreements that accelerated tell buying we run repurchase is in ratably entire

Michael E. Hoffman

you. Thank Okay.

Operator

of Raymond James. comes question of line the next from Our Brown Tyler

Patrick Tyler Brown

morning. good Hey,

James C. Fish, Jr.

Good morning, Tyler.

Patrick Tyler Brown

I out this but few about hoping but was is a can stand where with but sun I of sense rate it's of I Devina. I XXXX do it for an tax strategies. asked know you story? more early, in a the those where XXXX pan we know of of update, setting us quarters tax Hey, give the may ago, And some a alternative or

Devina A. Rankin

definitely a XXXX $X.XX. for benefit EPS of just specificity more So, about it's The is of story. those

our about think quarter beginning can And sunset the until way those so, you rate And that in to it's effective of a penny XXXX. don't a benefit tax a that. is

Patrick Tyler Brown

they it maybe fairly a Okay. cash sounds headwind, though provide flow will modest? And

Devina A. Rankin

we flow tell from of taxes up flow other because free those get of we you the in show cash pay I headwind would It's would And free a cash that perspective, that what is in cash and you a up cash from very outflows modest. the the potentially parts benefits (XX:XX). some see show

Patrick Tyler Brown

is in incremental helpful. That's quick helpful. saying at No, there And volumes landfill right. just Texas you Okay. that's maybe then, And Jim, very so from the in real yeah. $X.XX All are – and expectations Okeechobee? QX

James C. Fish, Jr.

the in $X.XX probably it's quarter. fourth think We Yeah.

Patrick Tyler Brown

Okay.

how that volumes think maybe MSW about So, huge next incremental I those volumes landfill you hurricanes, you've Fairfax think down? landfill landfill got mean, XXXX some volumes we diversion, year, we do had this be MSW will but do from

James C. Fish, Jr.

MSW economy ourselves overall us growth I reasonably pie, be a Well. on by largely No, of that growth Jim that for the I down. are for year-over-year slice a the don't that things, comps driven volumes difficult talked about think one are driven bigger us. by two be taking can potentially will having positive and to of then going and was they're good the the be and differentiating actually us comp I right think you that that pie to mean, now. overall of the why driven tell difficult bit pie there feels by the always I cause QX, reasons But, some would a a next for itself. year

excited but As putting now we're XXXX, don't any good. about on up, technology the our we're analytics through then separate position to customer that already part show horizon, then out of technology things data terms reporting use of interface. the storm couldn't and the of we and see And not ourselves clouds look to they reasonably into is customer that it customer right Nikolaj in why in starting looks a use of like we

the about XXXX. in room think MSW optimism here volumes some give we as economy and So volumes for differentiation going total us into

James E. Trevathan

you mentioned plant. to Virginia the energy Tyler Hey, waste

stated volume have have growth in would but been our lowered it would still but single-digit numbers. high mid, I the I MSW that it script, think,

still it's strong although going headwind might trend be a very Jim is it, or still So it positive. and have as to to mentioned, two that

Patrick Tyler Brown

or Devina, QX? comp QX notable Okay. catch maybe it there's accrual QX. And incentive a a then was headwind in sounds either up like in

Devina A. Rankin

over have prior In the the been nine those the compensation year, our ratably year. cost toward quarter. months fourth were in weighted more more the spread first heavily of XXXX, So accruals incentive

the would $XXX we expected are going notice on of part you're a that at see costs timing at if so slight million in around kind basis you a and increase quarter-by-quarter we're total you difference And a in there's XXXX, SG&A to most just looked but – a quarter. for

And right fourth the we or so is carry that's into out of to the year billion expectation we'll and XX% finish reasonable $X.XX run that that our think around rate quarter a revenue.

Patrick Tyler Brown

Okay. my sorry, last Great. ahead. Yeah, then go And one.

James C. Fish, Jr.

It it going Tyler, for about QX, million, just was right. $X was to say,

Patrick Tyler Brown

Okay.

James C. Fish, Jr.

year related in increase to million in cost SG&A year, million it that. about $XX.X the So was of dollars over $X absolute

Patrick Tyler Brown

can one the just, of that any Trevathan, hazardous just the on know house? Perfect. Okay. but it's waste high level small, I the side is industrial outlook? my on Thanks. notably you Is give Jim better And strong thoughts last this

James E. Trevathan

positioned doing advantage the we're marketplace in that facilities they're the occurring business. in of got petrochemical are of and fine some with Tyler, market. five taking Yeah, the well growth We've extremely that's that

overall, business part Some are a our but couple up we it's and to a are for of of down, solid that them future strategy. us be and expect

Patrick Tyler Brown

Okay. Yeah, quarter. Great Thanks. great.

James C. Fish, Jr.

you. Thank

Devina A. Rankin

you. Thank

Operator

next of Silber Our Capital comes line BMO Jeff Markets. the question from of

Jeffrey Marc Silber

you much. Thank so

to able there have the going back more have forward, pushing those be certain they're China. Are not to handle making that From quality in meet to only initiatives? going to wanted Just investments of something to to industry, going going it's facilities to reduce initiatives and If the to be go in waste the that the your you they're also to contaminant to percentage. talking but what's to try of limitation that's that you're are streams on Thanks. that? accepting, people recycling in quality issues continues

James E. Trevathan

more years as ago for recycling looking itself. that little that or Jeff, contamination strategy, two three a at reducing improving about it. to when It's years. I talking our but started mentioned color been well, of model earlier We've business part we

We've already game. excellent We've ahead that we're got got really of assets. good people. So

invested in of inspectors that our grant each approval. shipment that plants place. accountability Chinese sort a at good for mentioned those visiting in We've that be number look process material to have got we've prepared properly. I able the years to now of and been We a better really some and got have facilities

our material now. product. At material that for developed the them for in the for It's risk licenses win of aversion our when and no we've Southeast we long will the that and do to statement that. and want that in years when miss run in And recycling fourth in that support you brokerage real companies, help alternative business ship material quarter we're the long-term focus be tell is it's a we're business. doing It's the more world we'll done us, the going it's a of material make goal I marketplace. also I not granted don't in don't and stronger We that China We requirements. time, Asia that's to generate best class for even think same overall focus that to markets time. best the for for period that's thing though expectations sure looking where India, meet we current We believe their service, same generate meeting that to but the – service. think world we're we class a those for the we're the facilities So we've

to So but we are well. focus it, you're right on as

Jeffrey Marc Silber

if operating been you how up Street you've expenses drivers. Can a going pressure some going truck that's And continue that'll Journal right, about be think kind an Wall your there past. what us helpful. increased was All of know gears you shifting to Thanks. and wages in bit, on earlier this article that's week quantification then The for a paying, I about something the talked give just in that's forward? you've been

James E. Trevathan

been doing has as to competitive to we're to driver that and adjust the from trucking for district it marketplace opportunity. while look district year sure at by we to operation. ought We've our are a two at drivers it focus technicians we marketplace We're for gone a versus also another in differentiate for us HR MSA work for a going tell why team where strengthen payment now. look that a opportunities We accordingly. year versus that for or we make I'll the but it We've Jeff, and on been pressure, Yeah, with you, standpoint. by an we look at

So and our overcome been it see opportunities, it on pressure, with don't dramatically we've other has efficiencies P&L so you but a that statement.

James C. Fish, Jr.

that limit even It's can the you, would that us, for sure we of but while an a that it, the and extent a accountant life to and can I is the tackling for tell training significant certainly or is huge, a is of and of turnover There bigger consideration costly making cost an huge up are maybe be is turnover technician value are employee, that a ramp every a we when have. them kind cost doing turn we wage amount all that Jeff, consideration we driver to the inflation a limit we us for fact us. or everything to over to us.

So reducing we on turnover. have put real a focus

Jeffrey Marc Silber

Okay. for the Thanks so much color.

Operator

First Our of line the Corey Analysis. from comes Greendale next question of

Corey Greendale

morning. good Hey,

James C. Fish, Jr.

Corey. Morning,

Corey Greendale

the comp dollar the first drives on incentive very the higher were quick If Congratulations you what of the so ratably recovered. QX? last what throughout go in on Just clear had were, year, expect a so G&A, sounds The spread you for amount the couple outcome want questions. night's questions longer to Devina the I is the game, on there. year. more everyone don't than I fully all, call quick

Devina A. Rankin

currently seen plus be will and so current fourth can't we SG&A so range accruals with may in minus million that on be year-end just expectations, The what predict are and elements of we've there our there or with that vary quarter outlook. current a flat QX is QX $XX that

Corey Greendale

and on of work, That's of adjust can then hurricanes you've energy – and comment for the plant the just the statement moving the in I'm if volumes, trying a the relative bunch bit pieces of given things Okay. you. you underlying in this, pieces And you summative to QX? all trends thank you just extra with the those but little kind what of so a on volume helpful, saw quarter sort waste – addressed the of a

James C. Fish, Jr.

the mean, us I when about trends underlying questioning I Yeah, briefly are mentioned was I good. look, Michael October. think

definitely that pipeline was C&D. C&D hard small of, expected when in impacted Florida markets, was six to of for It's material hurricanes, looks volumes was period strong. bit so of C&D it take hurricanes. stream to off two coming a It's but the a do, to We a base. affects looking C&D after wouldn't three two you a say big very October waste because what Texas, and out. And promising. looks disappointment, – tell of weeks don't I the a And our in always do by in C&D a that kind weeks special months are going have

it's us. of us, still but So need an look very we commercial at to normal on made some line C&D we line the it's when more we continue one for us, of about. for then the has one of been continue think talked business it. that's the there, that for will return has very collection month we been and continues only to Resi important on business. the business, us progress MSW of on well to October. encouraged been been perform negative of for We've to That's negative focus to that, we're negative on residential numbers. well and And kind improving the the line with performing work side

Corey Greendale

I that Really CPI, to to contracts you QX that's me can expect of the price was, to – QX? is of your the the last and you helpful. just had do on in And of of the what quick remind it's mix question business your for portion relative benefit tied contractual, timing kind

James E. Trevathan

CPI the that in XX% a they better better structure is doing cost to we're a opportunity I in cost Yeah, worked and third of job just account continue move contracts the it's CPI, good away those as that the generally, the the We're Remember, a business. at that sewer of summer mean, quarter public and we've little to from industry in work hard our got in our and we've really occurs. that old fashioned of of move number, wastewater national we're another marketplace. our or the and range but that reflection where most of percentage sector to expire target are Corey, reflects number, a the to metric that revenue pretty quite for that to a of for – again, not grouping

James C. Fish, Jr.

the about equate recent seen about of CPI XX points about basis equates XX and to a – basis per about it's to mean I basis per we've points, $X.XX CPI Corey, Based Yeah. so share $X.XX XX that more, about points us. XXXX. in on little share for months, most XX improvement in will

Corey Greendale

Thanks much. Perfect. very

Operator

the Kaye from comes question line Noah of Oppenheimer. next Our of

Noah Kaye

so much. from quick morning. me. Thanks Great. Good ones Two

the First, and M&A. for guidance divestitures

$XX M&A million million proceeds around from guess the sense could that shift shed if $XX of the we I wondering you're plus to and profile which to expecting So, add? that expecting in the you're that's divestitures, of $XX something for just like a $XXX and was businesses to million the some spend get million remainder of I to year,

Devina A. Rankin

are The and waste is additions traditional the businesses Sure. solid divestiture noncore.

Noah Kaye

Great. some initiatives the sort that maybe, And really same, bringing about to what I a wanted here expectations the past, of to looking Jim, then, Technology that you the for of are you, as Officer, the Digital the But to on referred under to your could role Nikolaj. role? the at you're just Chief you and it the understand functionally I key congratulations guess talk Chief is think, Chief Digital Officer, referred in company I so Officer,

James C. Fish, Jr.

Yeah.

like felt It to job going Officer the in. title. more Digital was So, more do like bit little Nikolaj that XXth than just kind of title probably representative XXst a itself, felt Century the Chief we coming a of was title Century a

out it's starting then It's about big think list it's predictive solely promise. And some technologies, that it why like tell Nikolaj both. includes customers technologies, a to part such data. things really facing a that low we and rolling difference help guys. use Digital because under that all you'll I to leverage. visited management customers putting show him, path of and about we us a really and of coming from strategy, low changed that But, us I that Chief national already in bit. big kind and and down the that look, already competes advanced role, would kind starting that's that growth external look to low maintenance has and margin things that And technologies in those we're it's brokers tend differentiates all customer this We is whole and to internal an of hope reporting differentiate frills I doing important bit We and Officer years. Those of sophisticated week mean, separates in that last frills margin, big group the what So a there see the national of both and talked we're We've analytics tool start external use is it against Nikolaj of front our technology job time. think accounts position accounts a you some customers. how umbrella our low asset to us, are

James E. Trevathan

We results operating leverage and and and yesterday's attempt And see to with on of begun look the down You quality largest done by provide every to on service the metrics, we'll real-time side as other that know, with true differentiate Noah, district off more for And onboard connect or now can mentioned we already customers, sees we've that last and I Nikolaj the for operating customer by real nationals, – and move those leverage side of going morning customer the as tools that data to that area. years year factors. now side and Jim at drill those we operating with whether ourselves. value it's for the has We've been we're several the truly around forward truck. and computers provide what strategy. with every aligns he clearly Jim

Noah Kaye

Maybe thanks. in. just squeeze could I Great, one if

to impact the brokerage quarter, of the recycling this of part dilutive was brokerage last what out called business? that just quarter Can you just You the us overall margins. tell

Devina A. Rankin

points expense operating was basis margin. It to XX

Noah Kaye

Yeah.

for Thank Okay. you taking much questions. the so

James C. Fish, Jr.

you. Thank Yeah.

Operator

of Bank Feniger line from Our of Merrill America comes the Michael next Lynch. of question

Michael Feniger

of or is in. think profitable thanks mentioned what X%, about? turned model? when an business commercial less squeezing for is Hey, on maybe we about should When could with – we margin certainly typically volumes there incremental guys. And framework X%, especially landfill, think right the more then pricing is think think and margin about we we Yeah, more me expansion you mix business, your the the

James C. Fish, Jr.

Well.

points on year So, we've at of the margin EBITDA this for said points margin line. to least, XXX XX improvement basis basis

haven't at forward, and more margin but that yet, of gross still we'll in we kind And opportunities EBITDA Going did part second line say, that question? what nailed then we your the the about down XXXX specific expansion on of line margin was have down we be February. those margin or believe the we either in

Michael Feniger

And Jim. guess... I helpful, that's no, then – then And

James C. Fish, Jr.

Okay.

Michael Feniger

on I the strategic still recycling a one you about you was know now know and we're there's M&A? you Obviously opportunities, talk that when about of Is recycling that disruption on about for exactly in lot the opportunities list you M&A, what looking of are ...think I with talk when with strategic what recycling. listed. seeing things and the that

James C. Fish, Jr.

couple where of past and strategic have couple the where small the – in operations in certainly strong recycling a recycling is still strong really return, a think business. also into strong had is that They no, Sure, can we're are exclusively done acquisitions. places, business, we we a we where not I recycling almost Tennessee be of bought where buying really presence have margin specifically a over or tend to years. list either on Florida, recycling a There business two we

is kind is down be more some the of necessarily $XXX for other fairway, given the core waste And on of not we've the so, going are most part, range certainly that as to fairway, straight But middle straight the that the us ancillary of down the it solid $XXX businesses of tuck-ins. the are for still waste. list of solid million the comprised to million middle

Michael Feniger

can rating? is makes room And range is just to still us it's take cash What That years, your leverage the mean, free be and debt grade that up. able to obviously then in do remind your target have sense. the maintain flow you stepping I you baseline how leverage much on investment and been lowest

Devina A. Rankin

of saw, today. terms that it more X.X. targeting the measure. continue growth fantastic end the is we're mentioned leverage our specific I of that dollars the So, as as in really three a did of long-term. talked main because quarter, have capacity of disciplined ensuring think We how about just not way tell Well, of many I several positioned don't get I'm allocation debt-to-EBITDA here to measure of have, of to a chase sure our it's When always We've we rating we we're absolutely seeing we're just be and that are look an can't earnings well to the agencies over if where but but how I billion. you we presents itself definitely at opportunistic transaction have, We reason powder and right we much so about in up that if see we the going from capital upgrade business specifically confident to to debt dry one are that's not recently. you actually think EBITDA the the in a we capacity

James C. Fish, Jr.

encouraging with and is growth. nothing really this all that's would about almost quarters, earnings I and these acquisitions, wrong organic the just I really about not last the XX% It that operations that and last – And really that's been been it's doing several we has the add part encouraging X% driven by we're cash is like acquisitions, cash but it you we're from by that by and free and would of reports. acquisitions, couple growing tell part XX% by EBITDA organically X% or quarter

Michael Feniger

Great. Thanks, guys.

Operator

the And Noverini of from Morningstar. line Barbara our next question comes of

Your line...

Barbara Noverini

morning. good Hey,

James C. Fish, Jr.

Good morning, Barbara.

Barbara Noverini

morning. Good

Just a quick one from me.

costs in With and the on the a your we work decline rebate the see end off you've structure the particular. quarters? corresponding over Should OCC know over done years improving at the some falling quarter. to rebate contracts of prices coming in expect I the

through commodity rebate So how may expect expense I'm you prices steep in your decline line curious a flow time around? this

James E. Trevathan

exactly the right we Yeah, correct that you're do and rebating to that monitor our our closely areas customers. make are sure amount Barbara,

make prices right. news exactly as we sure strategy to change and occurs absolutely occurs it or business alignment as other of quickly commodity our part that that's So as you're or So, OCC can

Barbara Noverini

Thanks a it. lot. Got Okay.

Devina A. Rankin

Thanks.

Operator

I'm call questions the to for closing no time. to in back Jim queue showing like remarks. turn further at And the Fish this I'd

James C. Fish, Jr.

a the day. same Okay, Puerto heavy thank you. people But the toll at in Rico fires on path as the play who most compassionate you, each in and truly Well, operating the quarter time hurricanes disasters and this tell We're we every us, the was very lives were recognize proud and taken excellent that it those those Waste human I that. California and of we all and an reemphasizes we the play important roles of Florida beings have Texas, of Southeast financial for Management. that in are and of the to roles

So, thank next you again today. your for Astros. time you We'll see and quarter go

Operator

be conference will Eastern November Ladies today. and gentlemen, PM today this through replay X:XX available X for after Eastern

That access at is XXX-XXX-XXXX your in today. You entering numbers today's access our the system pass XXX-XXX-XXXX the by or XXX-XXX-XXXX the are XXX-XXX-XXXX code XXXXXXXX. replay international of local and conclude code the any Thank participation for with number conference numbers pass conference. you with XXX-XXX-XXXX may same time code Those XXXXXXXX. for dialing dial-in international again XXXXXXXX, does

wonderful may You have Everyone day. a now disconnect.

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