Waste Management (WM) 2 Feb 222021 Q4 Earnings call transcript

Company Profile

Participants

Edward Egl	Senior Director of IR
James Fish	President and Chief Executive Officer
John Morris	Executive Vice President and Chief Operating Officer
Devina Rankin	Executive Vice President and Chief Financial Officer
Noah Kaye	Oppenheimer
Jerry Revich	Goldman Sachs
Tyler Brown	Raymond James
Kevin Chiang	CIBC Capital Markets
Michael Hoffman	Stifel
Kyle White	Deutsche Bank
Hamzah Mazari	Jefferies
Walter Spracklin	RBC Capital Markets
Sean Eastman	KeyBanc Capital Markets
David Manthey	Baird
Michael Feniger	Bank of America

Call transcript

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Operator

Good day, and thank you for standing by, and welcome to the Waste Management, Inc. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]. Please be advised that today's conference is being recorded. Instructions]. [Operator like Egl, conference Director now speaker to hand Ed today, of to would over the your I Investor Relations. ahead. go Please

Edward Egl

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

from each high-level the comments will them today. a You update. cover prepared will details cover financials. Devina of Jim will overview, financials strategic of hear cover the and provide and an John will operating

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

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

to which SEC, of otherwise XX-K our will Some and or volume. discussed the are today's revenue most unless more release results in or XX-Q internal our references risks discuss growth yield and our with volume, filings stated, recent of uncertainties press Form subsequent by and as our John IRG updated in from Form these including filings. specifically areas yield the are

Any to retransmission SG&A and recorded today's this access of and day redistribution, website non-GAAP on This written the the non-GAAP consent a fourth of comparable margin, available a EPS, at no or XXXX. otherwise will have will of additional items longer for a EBITDA call at rebroadcast prohibited. call, beginning refer Devina excluding hours be Eastern Management Any February provided enhance measures operating earnings income, www.wm.com operating adjusted www.wm.com. hear on To which and the from is can website time to addition comparability XXXXXXX. and February Time-sensitive adjusted will tables, of the information to of be reconciliations before reflect during approximately time flow, on p.m. the do form the X cash EBITDA, results Management projections. are X:XX the call Waste unless non-GAAP occurring a information discuss replay until performance GAAP Waste by dial call which not business operating (XXX) being replay. our X, release fundamental XXX-XXXX replay certain measures. any XX today expenses the stated, to Eastern of in Internet, XXXX, To call, operations. amortization. which free income and During the code believes operations the Net at Jim, and and about reservation may hear results These been is quarter enter John use time accurate management XX. found of without our over p.m. is or express be that telephonic is company's depreciation measures Please expense be with of and in measures, call, the press most comparisons,

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

James Fish

another all at XXXX Ed, joining successful for All was very WM. us. you thank right. and Thanks, year

exceeded guidance, from results operational and XXXX, our Our achieved full delivering the year. expectations increased or we throughout that our strong original which continued financial twice performance financial year during

with exceeded further initial come. generating that expectations synergies integrated our already also the successfully operations, We to Advanced synergies Disposal have

that we to made our the lines of on in be overstated businesses, growth and It residential of record inflation seen from operating the been all-time these XXXX. organic cash EBITDA focused priorities can't growth on culture. is details had years. into over business provide translated disposal which During we we've EBITDA last return here, excellent together Execution will cash finished generated produce than with robust on adjusted billion a areas covering customer in came how over operating disciplined business. strong technology note advancing our growth, translated pricing yield collection EBITDA impressive our a This was where operations. price driving we've XXXX we operating cost and focused in steady across core revenue and to price operations EBITDA in of a John high and a year price Contributing our it on we XXXX, very focused more couple but $X.X best more operating retention core $X X both particularly from us that in Strong our all than investments people-first the to and progress record on of full our decade. we into $X billion, core record allowed year on more results to like billion as shareholders. landfill cultivating

X.X% Another efforts our and is pricing an strong about growth is story improvements in XXXX that seeing churn. great churn all-time still we're volume of low.

pricing inflationary our programs management structure. on off, we're increases recovering through cost through of fully and the aggressive kicks XXXX our As cost focused

team executing Our successful our can another hard in revenue and business pressures the work we on that XXXX pricing plans inflationary year. the deliver at is cost management recover so

several have very large In fact, price-sensitive, been seen recently renew historically increases. customers at significant we've who

to structure application management investments we efficiency the through technology On months. of the cost cost will part last made labor XX over the of the of front, a our that be materially improve big our

workplace growth. and best X,XXX for the our the we over is will leveraging the as become continue we positions to replacements and between expect X next for positions expectation At our continue source be on X,XXX to without to Our difficult attrit years same the focus case. have and employees network these that to asset providing time,

that Devina driving of growth high more at company a approximately provide of Regarding total X% But details. in outlook, we fair high to EBITDA the our will Investor financial long It's to EBITDA of the operating we our XXXX. expect level, in end at approximately both for deliver point are term guidance ranges at revenue operating growth XXXX. revenue our Day the our and targeted XXXX X%, or out above

cash invest as our our Sustainability and recycling while points energy to very We expect us a summer, to renewable generation. Officer the totaling last we XX strong businesses. XXXX growth The was Hemmer investments In XXXX. up operating robust half in same EBITDA $XXX XXXX a projects. to in generation, second to sets expand $XXX and approximately us year plants flat renewable compared path making positions light XX% of up margins business to plan she's sustainability for Chief plan of incremental margin of investments cash our approximately substantial with to increased expansion through in the our appointed high-return in network of be another the basis our gas year to aggressive an million. This full year time, our of increase charting cash extraordinary in XXXX dividend million rate, at generation XXXX Tara with expected for natural long-term

operating improve accelerate million conservative build next $XXX waste incremental footprint. EBITDA delivered EBITDA over prices, our with expected XXXX, to well quality. by in operating projects that operating in improve XXXX. RNG higher assumptions, expand reduce investments EBITDA projects XXXX fantastic to years, our these annual our technology EBITDA and approximately in XXXX generate approximately automation projects year we our annual recycling more process, commodity generate through run more costs, to also In by RNG $XXX invest operating network, superior In renewable recycling as business, challenges that would in the incremental recycling run expected are of $XXX And totaling we recycling costs processing XXXX, -- MRF returns acquisitions. XX product as generate processing They a assuming the per which to are from Xx. to the these leadership at and These price. quality single-stream million are year increasing sustainability million WM's than of the X investments doubles. rate to generation of grow presented. expect million. energy plants to those product of These the operating to $XXX expanding We With blended expect XXXX by capacity overcoming recycling are today's solid expected generated excellent $XXX growth closing, Together, landfill single-stream by further ton reduce automating rate than

our for our to remain us, to ahead look technology growth. serve to differentiate we that As leveraging XXXX, processes committed investments platform to sustainability automating reduce our cost advancing and we

members over employees John best thank the I'll been XX,XXX want Our their for all success business our our of without to discuss not would and detail have the turn now team I the more operational call results. to in possible contributions. to in

John Morris

Jim. Thanks, morning, good everyone. Hey,

fourth finished team strong of and Our revenue organic quarter XXXX the X.X%. growth in with disposal business collection

price XXX the our pricing in in discipline an well strong also continued core X.X% contributors improvement XXXX fourth of of basis of in were almost at and demonstrate quarter as leading X.X% X.X% robust clearly full core quarter disposal rollbacks points and churn. reflects the was of the yield price for collection line and to improvement as results year. X.X% customer and fourth commercial landfills Our business pricing in strong momentum. continued These

As increases, management disciplined residential are we recover teams our remaining improving pricing. revenue profitability cost move on focused to into disposal XXXX, and inflationary continuing on

entering than Shifting X.X% diligence, collection Fourth our the of volume momentum price have With to quarter expect we continued and approaching team's XXXX, core and deliver grew X.X%. with more to strong volumes. yield coupled disposal we X%.

service XXXX and full and and of in in the have weeks as increases spikes been Commercial the nearly January. the volumes Omicron grew Organic some cases have And service outpaced year, weather first parts trends to disposal yards U.S. X% few levels. contributors. year, of while about disposal volumes growth our collection during X%, MSW above see the twofold. modestly encouraging we are For leading collection disruptions to are seen even due Overall, few Canada expect collection mostly areas as industrial across commercial as XXXX volumes a landfill XXXX and grow with tracking in below that we country. hauls last and decreases

recycling management brokerage operating the costs. was increase have to revenue related operating a commodity-driven percentage increased higher overtime risk costs. rebates XXX totaling points. and due impacts XXX of with costs increased Adjusted to from to we points some remaining as well labor The basis highest fuel number as year-over-year to Turning absences as as basis COVID-related XX% of expenses seen

During while our on pressure the inflation metrics, on controlling And tight Maintenance expenses in continued fourth plan. quarter, our in fourth sequentially the quarter the locations, results that maintenance are the and standardize to remain XXXX as there to costs. impacts to and is trends put processes, continue of labor deliver our improved our particularly operating teams availability. us focused position market improving well fleet positive ADS downtime our on efforts reducing

We of also training saw efficiency, improving business. net lines all of hours, incremental

productivity We retention, expect as to impact steps driver these improved gains intentional taking that hours are We annualized the making estimate see to on since our about efficiency inflationary we overtime moderate as that our an continue helped improve to turnover of month and to teams third impact August. every has improve quarter. and points versus and pressure by XX basis the focus operating cost efficiencies

revenue second all our of the containment, to we operating expense efforts with it together, putting So on cost a our XXXX. combine improve by of as progress half expect pricing you percentage when

XXXX business so our businesses. Our disposal collection energy results recycling renewable positioned in to and and well deliver great and are is

and central an renewable As both with Jim discussed, the pleased in we're each strong and in are our and year quarter growth energy strong our XXXX among X to the anticipating sustainability earned all most quarters results equally time, of businesses. spot a businesses our recycling, In we're profitable XXXX. recycling achieving strategy, of we're

expected renewable to $XXX per Our natural very of blended delivered as results plants XXXX ton. renewable current is energy additional based this XXXX come similarly, ton, a current average in earnings values is price XXXX contribution X match for And commodity online. and per above of business strong which on outlook gas an is $XXX modestly

to fifth We year. to be the plant sixth of end expect be the second the plant early online operational in quarter by our and the

as for And above is we Our integration rate is continues our to price of first on smoothly $X, RINs Disposal about XXXX closing, pricing. XXXX exceed which RINs an of the know of XXXX current $XXX below on slightly based rate outlook our has Advanced we servicing exceptional the entire synergies year financial but finally, financial of a done marked the exited fourth of The In XXXX the expectations and our October. continue I team and our captured job anniversary with end that combined discuss our to outlook track the the over managing acquired the call our quarter, run ahead. operations, synergies focus and reliably during capital acquisition WM I'll operational million. million our team virtually the of to further in for To now we want date, will results in full at to customers. thank and $XX operations to all on systems. detail. cost have XXXX and their this And billing turn I Devina safely into go

Devina Rankin

Thanks, John, and good morning.

disposal recycling XX.X% collection achieved business XX.X% sales and and or of integrating price, also discretionary to cost and the the commercial In back the spending tirelessly leveraging million revenue. provide record-high we fourth landfill was essential strong Our profitability. our growth, ADS core operating growth of we're growth SG&A functions was proud XXXX of this investments SG&A results volume technology office Controlling quarter, to and year to and together. accelerating the robust services by and in our worked $XXX teams collection accomplished of delivering customers capturing XXXX. the contributed communities, EBITDA EBITDA reduce and our to successfully

came Our over our the higher rate was point our due XXXX revenue. That's timing SG&A sustainability-oriented to of costs XX of in a some fourth investments. of XX% technology- quarter basis run SG&A and XXXX. improvement than

cost pleased coverage SG&A synergies from able below to so particularly confident to Fourth channel digital that and spending nearing captured started was million, which our growing investments, the ahead target realize we lines. last year. as of we model, the to and the ADS technology sales both acquisition. so revenue a the schedule acquisition energy quarter value is XX%, benefits we opportunistically sales quarter process. investments WM at $XXX had differentiate our deliver percentage and end of our streamlining and accelerate optimizing continue of to were the of target the we serve, that capital the we're and SG&A technology on will term, our above setup expectations the after operating to We're reduce our long investments be we by cost in customer recycling renewable as In XXXX, quickly the Over as SG&A

transaction, from flow the operations operations At over XXXX. from XX.X%, to cash particularly strong some landfill worked support chain slow diligently volumes, While related constraints, we cash and continue to in with solid see excluding traditional benefit waste the flow divestitures of capital both supply billion. momentum the the billion, we when to asset cash year required growing flow $X.XX XXXX and in from free delivery close to in categories, and free increased cash schedules ADS our were Growth business. our on line in important XX.X% strong onetime to flow investment $X.XX particularly grew

returned our of of demonstrating Over dividends our a billion shareholders, $X.XX $XXX while accomplished the we for this stock. to positioned million of and all the a of about $X.XX repurchasing achieving course growth. well last that billion in are future year, leverage targeted record ratio We X.XXx, we

Moving to XXXX financial outlook. our

drives As of John high growth target. about revenue our that $X.XXX at disposal represents anticipate growth to X%, EBITDA the a guidance growth increase of mentioned, outlook billion the operating and operating end in business is EBITDA This the which $X.XXX we midpoint. collection almost in of long-term X% our organic billion, and XXXX

the spending to growth allocate and energy Free in $X.X recycling in of expect these the aside billion capital we be increasing to are XXXX. renewable excluding business, course expenditures and returns normal well of sustainability to invest flow, capital on cash businesses. range plan billion. our projected shareholder growing we be Setting our investments to discussed, investments, to growth $X.X billion the focusing the $X.XX we $X.XX of capital to growth to Jim both is in As planned in in the investments to range cash billion and positioned

natural We in recycling coming million $XXX projects growth expect of year. renewable to the make and gas in investments approximately

While business. an in see to interest these to cash growth strong they When increase is therefore free these considering high-return million to of $X.XX capital. cash similar $XX modest these growth flow dollar investments, will complement be be anticipates our billion reported taxes This and free billion flow investments our outlook cash expected component will our of expenditures and acquisition between and existing $X.XX to cash a as a investments an XXXX. capital of improvement to reduce working we as free $XXX traditional million in measure in as be and produce a flow,

commitment long-standing disciplined strong returns consistent towards allocation of shareholder sheet balance a growth to and cash and and Our continues. available

fund XXXX Our acquisitions be back the priorities in with strong the to dividend, returns buy invest business, grow will and tuck-in shares.

of Directors' approval we payments about total dividend the in ahead. the $X.XXX increase to XXXX Given the billion year Board dividend of in expect XX% rate, a

continue in also billion provided repurchase Board to stock. XXXX We share authorization program as to the expect repurchase our to of our $X.X up recently

what acquisition ahead does the excited the guidance opportunistic that opportunities we XXXX, are continue the our at about we and not pursuing While we're of right In growth, for right include we lay proud and will XXXX to deals achieved closing, specifically price. in in years. future be

for work at we communities, customers, shareholders. so and questions. open deliver on our let's environment hard that, Faith, commitments line With is team Our the our that can to the

Operator

first Noah Instructions] Kaye line from comes question of Oppenheimer. [Operator the Your from

Noah Kaye

And in that a haircut to an RNG EBITDA downside like the And given RNG. potentially awful that like while on of you'd that increased certainty. potentially for through seems the It the the fruitful exposure the there derisking around significantly specifically, to EBITDA should approaching more projected, having upside over the seem for be you're a of having long-term RINs. are basis how these thinking is and you scale exposed of fairly with understand contemplating in like those the and prices economics there's you lot contracts I'd the would how in investment And questions, about getting long-term the versus we Lots investments. of announcement does prices, sustainability. RIN places It guess you're economics the start of time? market but of investments RNG I what

should the we high predictability and earnings So how impacts company? I guess for that about at a be thinking how of the level, it

Devina Rankin

expect start Noah, that comments and we how this volatility approach I'll Jim overview with about the to and In so and renewable term, over things at then some the energy attractive prices continue can regard very So I'll that strategic portfolio. those you thinking contracts then the by mentioned. to with currently about how short-term volatility we long-term manage market-driven we're looking the to both to turn cover space, the long he

even volatility, that when period We're really at we that profile payback that outpaced assumed. spectrum discussed. anywhere levels release returns assess returns of you conservative provided. period happy That the with outlined of the indicates say a know both the to what the ends see also the acquisition both payback with the optimize in X-year then reduce in continue would the but return in I what's and the we've on we've volatility waste returns and solid incremental and between, portfolio press we we'll participate we best can and see So to that you almost order the the

James Fish

on I'll to Noah, to just add Yes. side, guess the -- And I I it strategic isn't this. there I really say think that think

have scale this we about have they as us else critical that that that's since we doing about the mitigate plants have investments. whole talked in But strategically, know we capabilities them really to think Devina nobody X and enable across how confidence these how a XXXX, portfolio. We team been to these has risk.

else has, have the We Nobody to amount that else an can table. nobody which gas of asset that is we that the bring own.

the fully and enables loop monetize and RNG. sheet. the the in then CNG close biggest And us to that America, we've leverage fleet the have We got lastly, the fleet to balance North

estimates to those, this through accelerate matter, pricing. these look we or, significant think you see in X RINs X XXXX. sense investments But anybody Devina XXXX and in pricing up ton to we're gas with the over all that going expects next referenced. I made at very that if built of if in of conservative a for So pretty for years natural out there that still strong is, us that don't downside come returns

Noah Kaye

around people. That's very And question is just second then around helpful. really my labor or

talked Management that the efficiency, to labor You've but the approach an increased making make really not and And of Waste same all you of industry attractive employer challenge force? you're about really and the years automation do positions program amongst of choice embarking and companies. in an of waste a just for on remaining now that continuing time employer at management Management at I many how guess, choice increasingly to constrained attrition Waste

James Fish

we've about heard now. talk while saying heavy her class, to a daughter or you me been next Resignation I of talking the I talking layoff Great right about whole operate a big in heard, that for used think truck we've not word wants equipment. announcing using is there, mean, a school a high This high drive attrition. turnover. which about you've as week. piece nobody my And about we're We're talking

benefit while. built us. provided just us So came those out We've which been to to the X on it this for discussed that focused length, a something in at a is significant we've X single-stream not labor those plants, last months. have We and

driven a it, thinking so ASL. by it's world. trash. very fill, difficult but as those for a of to moving, more have a somebody particularly get mean, call truck anything saw back labor I else on in there rear and vehicle look there's traditional that's to So example, trucks at available ASL, opportunity shift ride today's in a we to to of safer other hard load it's started When the throw than category from more, rear loaders load, X,XXX we rear we safety opportunity. it about And probably buckets to at we

than our to here today, can still coming part those our optimistic really in a of the us investments that I So a to technology lifetime we become to And really we've of feel is any 'XX for jobs as why pay like transactional company seen of culture affects leverage does. work. think use education tried rough where maybe a The great amount in to place those offering more buckets standpoint. been I more made done can at type we benefits, don't college sudden we've any this don't really We've some out what much attrition fill. X am it's never we've we absolutely which have maybe being a are I have looking categories where benefit, labor hard productive tremendous with culture. got from of start for rough as and to pretty to years, we all off there think of in where do a I've dependents, other

high let's fact the about place this is good advantage work. But we of turnover, very great a have to feel still take that where we So it.

Operator

next line comes Revich the Your Sachs. of Jerry from from Goldman question

Jerry Revich

conversation. expand I'm of offtake on if you could part Jim, wondering the the just

market be gas might You do you be just gas using much that be will transportation this about that evolving point? RIN anticipate conversations at to deep your credits? how how it that just you of X customers online. won't X and with industrial Can And going are RIN market how where talk deep is credits? into had applications is XX million eligible for going that MMBtu of How come

James Fish

give trucks -- guess the credit and you down answer our me that came giving natural continue that don't we the XX just on pretty have now XX% question. bought more if gas can But But technical X a a the you be answer to -- to bit as that's but I that. -- would here tell trucks. get fleet ADS, fleet gas. we I year we a going because look thing and of on XX% and you definitely our I I fleet expertise. an I'm routed that not -- we the natural when technical Might buy at was That is of over each mentioned having number very

hopefully, those loop a are us also aspects So to of entire the Tara chance but WM answer a of fully gives bit sustainability little you your I'm question the there, to leverage. it for but us that picture does a team can close the not and sell give more paints that insight. sure I credits and able nice technical

Jerry Revich

if then commercial and talk the can you for see pivot call, I'm out? industrial about 'XX. so we wondering, you yield about spoke bigger And could to you On Okay. increases just once the the we play to annualize. about acceleration how last the outlook, cadence nice expect talk and price coming

exit we that dynamic you that put Can should mean we course to how the than play for as look higher out? expect yield does So so to through 'XX, on accelerate of rate head point X%? you just a finer

James Fish

year-over-year look a started and QX. purely sea in the and little from comps our you certainly QX at a get will kind And price be the to if bit of QX we comps, legs think standpoint I easier QX. in then

nobody QX started inflation the see catch, As tell we'd in I would that we did you XX-year coming world off-guard. But the have I think, we entire high inflation. expected that year saw that, inflation, to that into

raise here pricing. so and a add I'm is we're to important aspect why can playing to So will we terms a of to not be lag bit get cost. EBITDA margins started QX get that attempting sure labor was we because purely the catch-up. point up. we where And catch inflation. And of pricing That's much is cover a probably we cover through just QX, honestly, dollars. how to there happy But we really to do that in

fact be margin labor argue -- I would I that terms who of And the it In tell very both year, talk that and But we're think critical I they're think of fact, to they an think couple customers that I it I aspect goes substantial a To John been took our inflation. told about gave sensitive. you pretty and example is we kind in in adding of price a in their of that seeing disposal rest price but system. we pricing, inflation increases, I points, mean, about had -- adding and remarks, for seeing dollars the would the that I EBIT very, can and primary where landfill think, offset understood piece pricing, they the talked that of that. the of prepared us previously

needed see long landfill increases about on showing on significant residential a talked price to is the vast big that time, those has we John so for And take front. and starting residential to finally price customers. improvements we're

So I'm me, business the lines business. seeing of line of maybe the seeing but all sign this commercial across and not pricing we're streams. that that all in seeing we're waste of business all is we're it in across happy this best that lines is terms of just To

at our base if our our at it just special look we waste, because special Our in look increase. And work, baseline, up we tends we a special number go business, our was think, but really big to into were in doesn't yield be that X.X%, waste I and waste. that's pricing

though. going Suffice out be don't happy price. it QX we're where on really with in have know to to going we're we're to QX, each So easier making the I say comps that, and spells quarter. progress we're that

Operator

Your next of Raymond question is from James. Tyler line from the Brown

Tyler Brown

talk basis. a be a maybe seemed really bit that And I could on it moving help. in that so some the were watered So was that I XXX mentioned, impact working year-over-year I down would you points hard John closed about you in QX. Any way mean, against unpack year-over-year a late as looks about of basis just margins October, pieces? what Can think commodities like kind think ADS you? of here to fell

Devina Rankin

Yes, sure.

So is which quarter points, his the us fourth XXX John commodities in to prepared basis actually in by against worked remarks. what remarked

recycling run quarter, components of the So that's the the those look XXXX. I our to well fuel. in of of points aren't brokerage as basis margin When part as remaining our were both quarter impact continue would expect impacts XX that of we fourth representative first of there the that of half And at business rate. about into the

XX.X% cost having to have the half margin that for XX.X% ramped pleased ADS inflation year margin in margin expansion this with. outlook XX.X% synergy significant our the with We year. in confidence and the in EBITDA us gives opportunities, of year, really the we're what we second that's EBITDA business integrating the in ahead. so Achieving that the in we ADS the know had back additional that realization half, particularly And

rollover incentive we'll headwinds expect benefit So Those the some than in a year. on as of more basis were could way actually, year-over-year in year-over-year next basis, be significant continue XXXX. basis. we as to points XXXX. had compensation on see We into XX That much rollover benefit be that a

target and all I XX.X% this with a for about the been in full for compare that all, finishing we a and at long brokerage So what the would using time. in is the adjustments year both to we at about And to that's are of rest because recycling industry margins, the year for you when accomplishment XX% impacts XX% talked respect the all accretion exactly came that quarter. for WM's margin space, we've a tell margin, real of

James Fish

still to expenses, the -- a of we referenced we also guidance a presentation, But that way, -- would work actually that I XXXX. XXXX. mean, margin year guidance. point by we I range seen one-timer at that to no and we are of it. coming we why this. the of that raised with got range, but to remember XXXX, And stunned way guidance don't to for at seeing for you was when we in about in said like. the inflation. crappy I but where And of combat off in X% having looked a then say, But we middle in XXXX out to that, tell X%. we're But the have we've I that's remember question, X% putting as investors twice a the the XXXX EBITDA, tell know time, hand-to-hand you at asked I range, look mean, at whether you a XXXX, EBITDA out I Tyler, I through of finished that what end that's that lives guidance kind are our time in presentation in as you guess with tell looking optimistic Investor that guidance, the top it twice if at Day you, I had and same need X% would almost middle our XX-year be XXXX and a our there couple in have able type when at that's were -- and, of kind we're pandemic for range with that will long-term the to of And in inflation X% baseline we the raised

feels as why and market that's as we'll the the we So whether see way. same are, we're optimistic

Tyler Brown

that of talked -- But definitely them harp Yes. we of But like that again, contraction more in going maybe it the and Or first then you half? flow any right, were to, expansion the back just the there? back. just first half in something on No, we like kind up and than for quarterly no, think implying the get down margins, so should kind and sounded just the modeling points about you I not year-on-year can back maybe in our color mean, basis in strong. XXX to then half but

Devina Rankin

Tyler. Yes,

of a look the year-over-year quarter, XXXX, margin. comparison had comps, particular, tough if QX we So really is that in at because XX.X% you

half to the the half in about you in projections first So a what what XXX back in basis XXXX year-over-year up and is points just points exactly on outlined our basis XXX basis the now basis XXX be We'll year. are. margin of down points of

Tyler Brown

Right.

Okay, so point to jumping a 'XX. off great

X last my just then And here. Okay.

that so million for Jim, just $XXX spend, new million And the increased flow? $XXX the $XXX savings, so is to much side, million labor material other is of uplift, the clear, And how is $XX to EBITDA that from of automation from MRFs? $XXX million the to million $XX million is On be recycling right? versus that

James Fish

labor. other had talked to we We this versus really high little day Both it rebuilds. the on period, have high going bit how them just Yes, returns. of know. where be be plants a really about new might really I low payback more meeting or don't payback really much of this is

both the we're -- terms on -- in not constrained really And good they're is -- of cash. we're great So investments. thing

looking as just about So team that it's we're want we right markets, Brent and make less in number either/or X,XXX picking are that the can talked respect X-year -- on a X,XXX and to more his probably neighborhood We about giving at period. is about then the markets. closely to to those over and. -- positions with we're And the labor is about new sure we're I Bell that somewhere of we've savings, that. the know

you don't So that are and than if it, a keep you in so temps, of $XX,XXX know, and different mind, these in, of all a call kind end I let's number -- of take we lot these are some high actually say, of get make. they the charged

here. a to We're all talking say, you the is see in, let's [X hard can of away those about the this in may move I kind these from those, $XXX,XXX those positions. most we where turnover, the right X] such of but attrition absolute number, not jobs the have particularly move So high may are. But $XX,XXX filling or that makes do where that's time a be And in the that not probably use that to math. think, -- really, time high we jobs right to

Operator

comes Chiang from from Kevin Your next of CIBC. line the question

Kevin Chiang

making of double looks ask these your energy the renewable maybe in the areas. you're just returns could roughly like recycling. will I If projects It investments generate high-growth

just wouldn't you double the that of of the other? accelerate gating wondering, just recycling? over investments are I return the think in So have If you $X.XX giving factors renewable what

James Fish

given I of think a thoughts we've lot this. on

right laid cadence the one. internally is the think I that out we've

I think we mentioned XX plants and that's a lot.

some that amount -- and accelerate to guess, around acceleration, mentioned. the out reasons complex. all of are lengthen are is is the further? we necessary we supply that I things So absolutely much that for does Do know these But how plants? the do. that's chain there I time it we think, we questions, these There build appropriate don't

of we're We've feeding at have them, that. all amount I'm I right places would plants the right where I plan we think laid in out. looked be of what with planned the comfortable we've places. think the that be, the But will -- landfills right

Devina Rankin

time. parts I in important really important what's are independent parallel we're on even of on our really work that confident And makes X and constrained forward us the things And seeing think which some acquisitions, returns that both investments working right? teams and another, on the move to each able simultaneously. is core great solid making not by So are these of this they X have and business our we're same returns in at than greater waste

James Fish

we've in very about But is Devina, talked that, and I million at mean, conservative and lot EBITDA. numbers. adding $XXX that these for a

I that, not and those million, So north $XXX out lot. pricing, in is $XXX if $XXX existing it gas it's natural a look, it's plants XX remarks million million. EBITDA for plants RINs why new my And plus of the that's at mentioned today's extrapolate you

So appropriate. the is plants amount planned that I think we've of

Kevin Chiang

The flow over free spend $X about point. targeting this just I billion at returns billion, on across cash fair sticking high. topic. that's dividends. very No, just your talked guide, Maybe If Devina, all $X including on to a the these projects seem be look over you

of just reading on making? that some of you for into execute be pushed billion. in a it suggest to Just get You we did pipeline, and that the DOJ $X.X or should I that does M&A opportunities about maybe tougher renew investments on these you're all the something maybe that make If line to something deceleration those time or out? for regulatory maybe based buyback the that the deals is you're deals the either together, up put we seeing environment

Devina Rankin

waste taking you that of transaction. pressure we're we respect we tell to of or eye we organization would acquisitions. solid have when our I were we're And Yes. with not the off amount outside as DOJ what certainly constraints that core anything not from ball discussed closing or the ADS focus the significant that away seeing like an

was of of integration ADS, oversee. in was us that And priority For we for the during the of half country. part that over the organization, that areas particularly us, the top that

#X priority an make team the perspective. to at was important looking it participating is so in that for M&A from conversations. and The definitely landscape us really And

an make As labor accelerant for market driving in forces decisions, about of the decisions. this them. been players some tight we've see always you their certainly And has the smaller talked

And so conversations, part still that. those we're of focused on

We in of to going are terms return. remain disciplined

be is the at what buying right so And for will important price us.

Operator

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

Michael Hoffman

XXX% Hey, I RINs we you partnering? or Houston, ownership of good Can to hope taking for a down back there. you things the go XX Are second? are are

James Fish

XX. of ownership At plan the is XXX% this point, the

Michael Hoffman

of will been there you enough. Fair lieu can't And do the other alluding that. ways this. fixed to create RIN? how having to everybody volatility creative out on another hedge you a hedging figure somebody trading to Because to has to, develop RINs recycling are in Maybe approach a that, financial But yet? are X for

So what's there? the opportunity

Devina Rankin

the looked an opportunity for potential. mentioned an The those upside and that some to that good I up without much diligently of continue there very giving too exposure, earlier, And level long-term be have do to contracts to balance on long-term had work is space those have appropriate in volatility we really we and so market success. that we appropriate contracts of

Michael Hoffman

is long long? How

Devina Rankin

XX been them of and more have less. than Some years

Michael Hoffman

they what's and EPA you the around and Jim, messaging telling volatility. your RFS that the of that. about Because demand If can't staff control Washington, move have side wrong, the that the you D.C. greatest and the they crushes RVO? around Okay. that's point

are you? So telling they what

James Fish

finger that news pulse erratic, our next the the on areas PFAS to for is not about they billion CCRs, bit in And exception is And way maybe combustion put tell maybe talked pipeline it It's of develop. there's the as the a their really of consensus coal some topics, then seems think you the with -- is some of years. X opportunity lot starting we I'm lot that the we've a like those discussed. for to things I $X the to than the been the That those full would seen best an over longer. we've is area have talked within us see be longer guess. being on there. the have the we ourselves. like that I been good tons up have a pulse sure mean, that is million-ish I little opportunity EPA items. of -- about XX of I ash But which that discussed always just other like kind is -- an PFAS. residuals, and

John Morris

but think because think, there. market. to exemption been small that commentary exemption, There's the thing Michael, I also other there, extinguish we're some that refinery of nothing part yet, been that's the what's of the decided a there's right, is they watching I in extent obviously that bodes And some that, well.

Michael Hoffman

reaction 'XX do good reaction send Well, to seems at we early with December, and price, at and to was least price. too]. by If for outlook taking outlook and don't next to better That set compromise on signal up more current to the time, ended what's X.X? to A the numbers years. ago this customer X.X price, What's [the average the too the could year core in the X with is the we a EPA the shift an for early price? good -- whatever that the recognize, you a 'XX news seem many exemptions setting

James Fish

an best churn the I be I the indicator all-time was in and mean -- at numbers. probably think low mentioned there. I -- would the our churn

particularly in QX, in back there a a taken come costs. being our that So but no in QX. for XXXX. number little labor to I think, almost lot John, already. the in bit north from million down the But we've adjustments was because $XXX simply hit those That adjustments just started inflation, heavy pretty of is attempting the inflation look, I apply think seen recover out about the judicious it, And that's we're that We've and reaction to a real, been is we that people we're easy how task. understand that it's economy

John Morris

Yes, slightly over.

James Fish

Yes.

So I think Michael. the accepting, reaction reasonably has been

John Morris

Jim business, to seen residential in core the and and the automation Michael, pinning benefits we're our down would to you've improvement too, add, But most labor-intensive the with regard path sequential of yield. I that price residential. line talked

as to especially environment, to this labor some kind seen continue don't We're also of going short degradation. of which volume in the see You've we be selective there, term.

good price at trade-off and for labor shareholders. the we as So look that

Michael Hoffman

Okay.

say And that? look is then of side, still business new volume Or would at upgrades you're existing? you mostly helping so growth seeing if interval still service I the this

James Fish

about increases. of on I some think service factor like increases There's of decreases. right? almost both, talks think John a it's a versus I -- by higher it's lot X service

that think revenue And So would in pressures. coming volume we probably see have, both, the mentioned I in that that for big -- we bit don't special portends have good mean, the be that most I the a stream economy is is inflationary waste. Michael. it's the economy downturn forward-looking a of we what even a with the I

special good. looks pipeline waste really Our

QX Our strong. special in really was waste

had fire a driven Gulf year. so hit by us to year-over-year flat. that it you And remember XXXX it saw be lot -- I the that concerned wasn't comps. volume not was were areas hurricanes roll-off was we're late really and because But -- something last of for about volume a California the of mean, simply in only difficult because the were we that also Coast Northern lot weak

And there lot was that. volume a from of so

have much seen number would in we a more roll-offs. that, without positive So

but an the looks bit decrease from think kind growth be emergence overall of which those, piece, also is and of COVID economy. kind I service service to still the both volume of of of a increase,

Michael Hoffman

pipeline? corporate to which a Is is at -- but less than question, the you busy? frame think it or then industry? development rev underlying of ongoing how X% to a And you it organic the growth, the is the that can it Okay. is you're participate modeling the reasonable X% reasonable M&A clarify not little this, consolidation in And would growth

James Fish

were time, capital M&A. bucket. looked focus always returns of But overpay while and our that for the generation has cash has acquisitions. business M&A solid to these look on And there's same where it the the big returns we'll of opportunities, like But want somewhat a been landscape have and that not doesn't we investments in we'll try the on we're at felt respect there. think waste those. And at changed of the those tremendous, better finite the we here eye it's like, gas just But we bucket. recycling, take decision with than advantage incremental so these a for renewable we'll an I always on in don't allocation natural It's significantly. as -- careful infinite to

we arises And it it. extent so invest again, more we an explore we and But that therefore, with we'll the like feel gap, there. will to M&A, like feel a opportunity builds heavily

Devina Rankin

million -- in then, acquisitions XXXX impact. rollover about from a on had planning divestitures And solid XXXX and include guide Michael, a perspective, actually were our from larger does not benefit M&A. only any waste The $XX

'XX So from anything doesn't outlook the from guide contribution. contemplate perspective, acquisition an

James Fish

in waste XXX% type I We I've that talking little acquisitions solid almost the very about EBITDA a mean, because that high when I But that's X% long-term XXXX. rollover not from of number in about point, end range. a -- way growth is I that acquisitions, great talked we're Devina, organic. big mean, had of acquisitions. the at

So the end is we're in significant of it. X% of inflation, but which that range, face the high still it's about that why pretty is at talking

Michael Hoffman

to XXXX mentioned be you've XXXX. need lot since So world's several a the revisited? Do The assumptions changed times.

James Fish

for come you has X to Well, what the XXXX, Investor But that we'll low X the assumptions about pretty even, we need years, X mean, years. argue inflation. after might been years see. or Day last in X which mean, last X talked I world down or the was at and yes, I the

built EBITDA enough talk sufficiently or We have So world Day XXXX we different into those may to XXXX the revenue ranges. to another Investor inflation that and about ranges. low decide after has changed and

Michael Hoffman

for of much pretty margins. X that Last improving now John, there you've you much Okay. it's couple now or are been What's left? left just me. Is and focused diligently the years for done a resi maintaining?

John Morris

we a environment, where We're mean, question-and-answer world not bit. labor the period. I talked a the a of the think talk about well, has think you I and world that remarks about bunch changed our from about We prepared done, labor changing started in when good Michael. this to lot, right,

the goal and the still tell there We would little of still competing a has business there, with the line intensity you not commercial there right? have higher margins bit, The are opportunities moved -- rate that others. is than the I and industrial. So automation that labor

the think of as in of back terrific the the wages Omicron as inflation, things, if there. good we've So you half of additional seen we've on have I I pressure, much about year opportunity mean, made think some QX, we impact progress, still those especially in bit all a

Operator

White from Your next Bank. Deutsche from Kyle question is

Kyle White

I on But wanted and sentiment market wanted the bit point a step could Obviously, any impacts I details your high throughout going about exposure lot is to back talked go take with of little that on how broader have but Maybe at to doing while a housing -- have level notable to pipeline. you weakening. spending is the economy. in just level you the that about terms maybe business, and broadly a you given it talk guys the a just a high waste what more you economy seen. back special consumer at well,

James Fish

way, feels the and it then service I didn't mention to more is challenge a about we've become that positions at like plan really a to to think looking we long-term X,XXX challenge inflation attrit will and business that I from a degree, some a XXXX largely in digitalization. in technology. away Kyle, the standpoint we're So customer challenges made saw the from investments that and the labor lesser this going lot By We've we the to what to productive hence, in maybe, the XXXX. labor replace are these be add that X,XXX talked need

million somewhat call setup something we we was in function. of not -- so test XXXX, jobs. with our jobs, We It so number And sales of huge a savings. case, it It maybe a optimization. did maybe as about fully of some was automated in $X our customer XXX similar

course, Hard general, see through of to the no be saw some than piece X, see gone then, be would I I we what that much we quieter we've guess. with XXXX you it. of and in a a tell of it a easier the We've we piece So and than through to X. last But gone last recycling. of year hope

Kyle White

see. Time Yes, will we'll tell.

see any prepared maybe, a of terms the impact Omicron? and you think into I late rise the did know you the in in in from but this? volumes just Canada, from your rise I mentioned In think impact of quarter on Omicron remarks, January, the it's small any I exposure,

John Morris

wasn't on and There it impact really an was our mean, I it overtime was -- -- yes, spotty. more our were Matt, of a it it ability our service was few to pockets. customers.

You A of where little generally but bit been referenced of up there Canada, in a little unique Canada. a volume there impact circumstance it's speaking, eastern bit no.

James Fish

with we We employees XXX at the either we gave we number in virus or about peak that was who did -- -- had the think the see QX fact as some I talked exposure. the are many out

more fortunately, And quarantined, XXX contagious. so so definitely therefore, they XX,XXX. were of out serious Omicron, it seems less but

probably and drivers. X,XXX, of half that peak -- those in so The John, was our numbers. up and were And showed

John Morris

half. than More

James Fish

half. than More

and it about which January, news are us the was opposed that it, Delta, and August, our right of us there for are happened September, down come in for peak if volume. volume But to any early from now, So we're of was as it pretty good December, kind dramatically. slow months those was peak terms in in those which seeing numbers months back

Operator

is question from Hamzah Mazari line the from Jefferies. next Your of

Hamzah Mazari

margin -- touched a on you had operating question and first side, the on follow-up just leverage. know just I I My but

seems know to second I talk growth. the you been more half, side? and XX% understand kind organic labor CPI low margin could I resets site you still Could of have first high pricing earlier expansion on just inflation, half. maybe you sort right, pretty you about cetera, basically, hit said, of discretionary on As -- single-digit is had aggressive but margins et relative the

that's kind peers X. like peers labor higher point, are because your So it similar second of turnover is growth. your point than revenue And getting margin then organic expansion on your seems

more just company. higher. whether I aggressive you're could you turnover much curious a price larger have or been on earlier whether is your I'm So know

Devina Rankin

not margin you right? Whether the to respect pricing activities, and saw observed I'll economy, I third think, significant Pricing, what environment competitors on much third our the results their in as was quarter cost I commentary. U.S. quarter or acute the impacts, well. start our the a with more across change those in saw

integrating is plateau. you I Instead, with that in the base what that business. curbing results the XXX steps we should we a the be the that to our is from one, which tell perspective, indication know has we WM definitely across From ADS economy. active think were a X things: take happening is we lower so don't would margin And of than point you that we sure happened what that any XXXX I of away turnover saw business, what a were were XXXX margin taking basis our were base impacts employee

perspective And provide so coming knew QX the response QX, a price think a from of point very that points, QX, we in mentioned we've cover year. quarter continues improvement QX. cost us basis you provided will perspective late to pricing going about acute we sequential to activities secondarily, quarter before. the the And with some prompt continue that inflation margins from into labor on in in perspective good into margin pricing really would early fourth where QX and the both that XX saw in third a on basis And pressure benefit that really as a have from that hit our efficiency earlier, then sequential we saw

John Morris

going second half certain you tells you to think of level I to the say, so earlier that some was the on year, a the I going and math you how see Devina half of in pressure half the get level. margin what's if I you commented kind see about that the confidence think just the assume But margin. we'll it happen year. first of do It you our to gives back of heard about margin we'll really about what in to with improvement if

think full is I of point, as on see comes of we we good that revenue for your some mean, the mentioned line, for residential -- the earlier, is in going the residential year. in a July. about CPI chunk Jim that next think to that year X.X% biggest we're see lift what And and I

as had turnover, comment I you can't is far effort that the What in As process place. put others. and I we've concerted a we've on can very tell

not seeing. a fix retention are we're trend you But improving We It's acquisition overnight. pleased obviously since we've numbers. what August, and seen with

on So and basis, a of bringing those those terms net retaining. making in headway when you look on are we we're we're

James Fish

core I aggressive? about, only we quick, thing you I We're compare. other nowhere. in I you inflation regarding as can't is well, expected if then because aren't talked pricing, because guys I have world say, seeing the and our I respect is, good in it. were of very don't price. turnover, Hamzah, Antarctica real of us turnover tell would showing there a covering you to might for at what But really lag. came think the getting inflation don't I is don't And out boy, guys' not -- not more know like for And I with whole I any X.X% X% we been seeing more Could was this their inflation mean, know. they're mean, inflation. operating first core X.X% business, is QX. think price we they're all, there. anybody

with sequentially and and made making. happy continue a in we're to I'm see QX, So the that of QX ton We've between progress progress we'll XXXX.

Hamzah Mazari

Got investments, it. the helpful. risk. And question Very my specifically follow-up around is execution on more

You XX the have plants. RNG

you're on Do to take on XXX% ownership. you engineering partnering that? of I and going I'm the strength have you're this. execute to assuming not sort think talent you said JV bench

sort through the too. CFO, think just all ethanol recycling plants, forward. these of to and long et new WM help different but back investment. I Jim, refocused oil sort as the you risk. accelerated of But ago, right, of wheelhouse, definitely on was phase your of of core, bunch paybacks recycling, ton us EBITDA I risk now investment execution is through and when historically, investments a guess had help initiatives a Again, execution very cetera. mentioned waste-to-energy, But sort ramp. you of think you much going and company the automation a it Then us this made is core fields. in a this were time mentioned You just great RNG, execute know

John Morris

look years recycling. commodity So even confidence margin Hamzah, on our look have And I X, side. when tailwinds, execute ago, on look in And that forward, commodities business investment charted that path an to with we standpoint to with ability start you I'll compete were we -- return think other a total was the don't make the X, even a at lines returns business. the and improving on mean, business. we where have down, if X from of recycling with you at then the you were if I recycling we

we've demonstrated with prices even that I the not model, were tailwind commodity about. think when talked they fee-for-service were the we've

got back recycling I on steps So we've the think side.

-- we do everybody the in believe like and I biggest we terms We're these else. operate America we of In plants. the recycler North in build able place have and than team, this better be to to do to recycling

put On the WM terms the down XXX% of risk. the other now, Jim got to commodity of of We've think potentially we're road the right Devina some we said the in could and talked place RE optionality side, risk. backstops what is I assuming

we that's a we and In bunch have fleet Jim been the terms now. of for the RNG execution, in right the mentioned years of team have business a

and me, need less they go to this about to the faster. about, resources It's execution So team just really Tara is risk. that given

James Fish

doing But of we we Hamzah, on have our point, for business optionality. own. suitors, on I shortage still at have feel been no we there's mean, us. it good potential the But RNG -- this about

Hamzah Mazari

somebody, by Got you you bring what that mean? you is in optionality, mean it. potentially that could And

James Fish

I sure. have the the If mean, the landfill gas And of of table I we X bring about, X that talked else. we wanted, more the things than we asset assets anybody to one itself. is

conservative talked think that in I differentiates valuable high or be And about numbers, we be us think is so million going more. what could X really are us XXX into that we XXX very as for foray things as those RNG to this at hugely

partner So answer But optionality if with the we that our we somebody, yes, could. up means to we wanted is like that's position.

Operator

RBC is the next Markets. Your question from from line Capital Walter Spracklin of

Walter Spracklin

is and growth word -- for and/or might say, out have dollar going return it's and growth is the this the XXX% and open our years, of the growth. initiatives how at therefore, allocated And might years? models? in acquisitions Or CapEx that, on of other returns to completely is our is now to the something the all Is dollar next also EBITDA have add that the otherwise X M&A being would capital investor also have we the to years this complete likened probably acquisitions built over what EBITDA complete? that Or level words, impacted from over it's affected? into those my terms something -- we or because models, I'm our use X might to have not cannibalization, now long-term deploy In you it or as to CapEx? back it have question, to we extent framed to either year your the years I been but in that let's is incremental is Were kind gone by but it, decision that next Do much, word So guess, would investment right you in of capital modeled in of invested growth they your areas? do come these been much potential those for this. how

Devina Rankin

Yes.

answer it's us. a is for So the easy not trade-off here that

otherwise that have would of So this we taking of the other is some not way investment or place M&A. growth pursued

incremental. how And it terms this to for about is of incremental long-term growth outlined. our think that outlook we've growth looking you at this reason that is in long-term us, that in For outlook,

Walter Spracklin

That's that. fantastic. I Okay. appreciate

in as on. On customer passed the customer of than that's shifting question as to there customers suggest bit so incremental sectors and there among pricing? level it back goods as is pricing as on with more churn, the be level higher picking is and -- day to behavior those to any be My the trends your that seems up a terms is, we to as recent quarter, of all would here able little Is competitors in that's you every much fluid what how increases, fourth the even coming little all impact any pass churn -- day -- on is new of of any change is pricing that and there but enter to services that the year, price, a in seems on again, new price all, all at customer churn manufacturers seem that be not the may with be expected? the go

John Morris

I XXXX. of see answer in And what look would momentum a tell and Walter, for and you, talked that no. as you about I week. at me, once our we team question And about asked into believe QX exact outlook our QX, the revenue here, short is we've the management

trying inflation customers, about not away. understand it. of thoughtful all it's think going about to that is just I real, that the receptivity our we're of be And they

to to everybody can, also that tad recover quickly And too. also comments of long said, acute was we -- doing Devina we're game, base while customer this question headwinds didn't we -- and inflationary I our our that the really have, view Hamzah's momentum continued that think 'XX. that's take think when to certainly see as there. lifetime customer through is And I throughout going seen -- the than as consistent. model from a pretty selective some we're making receptivity I decisions I base you're obviously, is has don't in make in and of trying the going think being we're on factoring commented some And One our a as something the revenue been took off-guard. -- the I other best residential, I value what value of the lifetime haven't we're of to customer we're

James Fish

idea I what their say competition honestly Walter, can I on here, I mention they think have talk is about the doing what publicly worth also, no calls. than other

attention it's to. pay something not So we really

We a so our and how cover, have cost we're that's certain that trying structure focus we to pricing.

Walter Spracklin

sounds seeing taking appreciate little customers table? ahead. go price answer. But a on competition on the less that's not question My yes, is I you are the ground level, you're Yes. bringing really the than at -- competitors like it with

James Fish

competitive always business. It's a

mean, competitive very out are a So are customers? I It's there that business. competitors there taking

We cities have or where dozen have competitors a we more.

a respect part is day I a that are like day all I that's plan we with deal we don't of really place out. I in these the to is, focus it and don't big -- pricing But of feel and think yes, what solid, with because in on I answer just contributor. financial we really have robust So to aspects

Operator

from the is from Capital Your KeyBanc of next Markets. Sean Eastman question line

Sean Eastman

is guys you back of guiding previously to flow you conversion XXXX to sort investments. said So free level? like XX% sustainable It close that have looks a in when cash accelerated the that out you're

million into do trying just mean, conversion to I'm on we XX% underlying sustainable assume XXXX, where and term, any kind underlying So longer that remain would be color maybe and going conversion of I think then goes that think sustainability helpful. $XXX elevated? rate investments about

Devina Rankin

And a Yes. sustainability end at right, look in right the the were right targeted that and target that I you're goal, you're outlook, accomplish at XX% guidance happy to perspective, a project When XXXX. bottom of we kind our Sean, of longer-term exactly perspective. we're remains that range. from from

X% work When about. for I level that look to XXXX. outlook that be we've think we be that would we period. XXXX, expect optimization. can similarly growth we that, that continue the through gave that will to to in elevated more continues can X% working growth With outlook provided investment through how do XXXX of on at EBITDA long-term talked the you our there's contributing And that that factors, we capital guidance treated of

both that we'll to revisit the tailwinds business as we continue different So contribute factors the see of headwinds certainly as to and appropriate.

predict we because things could that's So rate whether and and remains one, just pressure, from a XX% the mark, impacts. just or it is that that downward at the I cash here. some future improve to control, but it tax put bonus things big can of we're and depreciation working for Those we hard the can't with and really comment look it can't it be corporate try to taxes not on going continue hit too predict to to benchmark regard me question

John Morris

It also cash those And right on if numbers types X cash free Devina, Obviously, ratio at at the your you of flow. then look piece depends, XX%. is too, the growth X our the investments, flow, is excluding right, there. of free

we CapEx. those allocation If essentially you investments define look decision way today, is this of and kind RNG about at is it, and extra we've a the in pulling CapEx making spending out as which capital growth lot and -- we're a recycling, talked

a flow technically So $X is free that little in or more that giving the bit that cash guidance than we're billion-ish range.

calculate it the If you ends up ratio, number use that being to then under XX%.

flow If about XX%. you're report that a billion that's number typically as to then cash you range free billion, the would that of $X.X something use we talking $X.X

So there bit understood. a to be needs little of that, is in math that

Sean Eastman

shifting to just over investments. technology And the

is a programs. you reflected back to guess, I'm we've XXXX other of lot Obviously, trying inflation you the office, think pricing to there that context I combat just automation, the cost talked have the guidance? in levers margin in IT the got And going efficiencies. into about juice XXXX? Just the WM’s about guys beyond How

John Morris

some And making it. we're I frankly, I think, labor time Jim, have transactional think, efficient, jobs. that mean, to of replace I the Sean, we right pool we a spoke more the all about operating hard it's and to technology using that's side. But filling. where these having

the We've processes, and the all analytics talked installed have you in a part have. we wheel in those seeing a the that's we've the picture, we of from trucks. the reason is have done service about lot with commercial whether of technology we don't operations. And look technology increases that it automated think If lot look revenue you the data send about of technology folks team picture some a the particular, technology And put they to behind we've where a side, growth revenue take our the to at those on and in we're at happening. worry of if that's and decreases, one is and

on is which is call made investments top is examples are -- coverage of we we getting force, the side, our are operating helping really more we've of sales one seeing the think in sales also what the as the just not which example, a technology line. couple Those truck, smart I it's So where optimization, efficiency also directly out contributing. about actually

of margin, juice. the terms In

Devina Rankin

technology to the at up see on expected the you, the for in tell are already SG&A top one be the business margin, XX% we we look side that particularly I’d when in John XXXX Yes, the accomplished on margin below place we the that showing is our what other mentioned current specifically than has SG&A and year. line

James Fish

a One know winded John's data last here. analytics. of I a to and talked answer little thing he here. point, But And about our bit long we're

in So line our working they're analytics optimizing, specific the a is team fully our of on data and of business. process team

is roll now amount built optimizing ultimately collection and will business of rolling a out And all fully but goes up kinds now there. the data lines number like it. stuff. containers, there's kind roll engine is it's of process number an number. So but we're up the calculations of The that fully, into traffic, fully zeros data, they they're on working of data, it this of massive in line there, It's Right got got got this ridiculous imagine period behind business. got of over of a of road customer XX months, all permutations optimize driver a information, it's data, the got all of the it's

then is number. fully, you start So to it nobody optimizing optimize Amazon it a respect it's ridiculous probably and an way there. maybe these where with to of us But huge we about talks talking about does point else and a for it what take-up a the routes. think We lines fully can get business, these there's productivity

of are some one take love is able So advantage the And those to that this avenues. of what we'd about to talked of be driver turnover it. we haven't

Operator

from Your David Baird. next question from is Manthey

David Manthey

automation facilities can are investments your improving include about by of adding Are What single capacity lot would be do of what and XXXX? investments. that just productivity just a understand, covered question You've the more today? recycle existing a And stream XX? here. on by if And they these But processed percentage your facilities? volumes expanding just recycling I then

Devina Rankin

of get covered of Heather and Ed percentage the to network. tonnage the you stream by with terms will and be we'll So sure information circle the you in our back single

expanding have to toward footprint serve. be weighted that don't automation, at our with will markets Sorry, into making, regard But our we but we we're it's don't markets currently more investments that that exploring heavily new we fingertips. single and stream the

James Fish

Some city presence, market of our the was a internal miles of the better city we down the the facility that's to it do in that we have as a like we be we two there meeting to away. city be might but in new North. where in South, investments city presence have feel XXX to David And the heard actually a a to the the would go close and don't the

how is a we do have decision capacity there It's underserved bit too. markets a we of where add just there. always not there do So and strategic

Operator

from is question America. line of Bank from next of Feniger Your Michael the

is line open. Your

Michael Feniger

I QX, think guys. 'XX, us, acute around been Jim, so you Can you core the I'll the Hey, cost know X.X of the great help very yield XXXX? of we When for it's long, ask embedded your inflation. quick inflation us one. strong. gave just for just in for what's of price X% color and that's a

it mentioned, XXXX versus we what as was You XXXX? like I curious I'm lines Thanks. some believe look think like year-over-year, on that X% of of business. should just

James Fish

what to Michael. X% in we X% built The inflation is

cover where are with pricing. of positions. comes like we -- we removing some a get that to the transactional point from margin lot So these places that type to think and why then And and do that's we able automation of a growth

Michael Feniger

the you of high side, inflation just of year this the COVID And the the it. of when can half it depends get CPI CPI you print. look on really half just because Jim, CPI Got lastly, on CPI while type at other

when I see through XXXX system? mostly running second really CPI through like about like or when is half a these timing of really book robust we'll the guess, business, just kind half-second So your even of come that? on What's it the print think is CPI I

James Fish

discussed, lot a of I nailed these, really of a as There's think of lot a second lookback. you Michael. these 'XX. it adjustments have half contract It probably we've XX-month there, is

So capture aggressive it in get this July of even fully we next pretty ramp-up until year. won't or to January inflation

take talked XX% recall almost You happen year. may the we've about the half of the in we front of adjustments that

maybe not the I the July. extent lot. exact just of that what so the in And we which going forget the January to X going big January, And include and to lookback, January, took X to just months XX-month ramp. for that took but big we there's are months what a the a are, ones in percentages it's inflation whole It's include adjustments

year, months. XX it include will Next

-- get this inflation. include adjustments, into big year these get ramp-up And with in deeper so we the we the the will farther the more they into

Operator

President turn questions There are to over CEO, no Jim the phone. Fish. I now will and the call over

James Fish

we a year. good Well, I us. call for felt have to quieter you. excited today, We're think, right. all about a details. bit gave year coming but where joining like it you thank you All very Thank some hopefully, into we're finally Long going feels

And so we look and out you thank us, road. you all to joining for on the seeing forward

Operator

conference participating. This concludes for Thank you call. today's

disconnect. now You may

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