Waste Connections (WCN) Tops Q3 EPS by 2c

Waste Connections (NYSE: WCN) reported Q3 EPS of $0.56, $0.02 better than the analyst estimate of $0.54. Revenue for the quarter came in at $546.6 million versus the consensus estimate of $533.96 million.

"We once again are extremely pleased with our strong performance in the quarter. Improving commercial collection trends and a 7% increase in municipal solid waste landfill tonnage drove better than expected solid waste volume growth, and E&P waste activity continued to grow in excess of 20% despite more difficult prior year comps and unusually wet weather in the Permian," said Ronald J. Mittelstaedt, Chief Executive Officer and Chairman. "Year-to-date, our EBITDA margin has expanded almost 60 basis points, and we've converted more than half of our EBITDA into free cash flow despite a 75% increase in cash taxes. Our strong financial performance positioned us for another double-digit increase in our quarterly cash dividend and, we believe, was a key contributor to our recent two-notch credit rating upgrade to "BBB+" by S&P."

Mr. Mittelstaedt added, "Discipline in deploying capital is as important now as ever as we have been reviewing a record amount of potential growth opportunities. In addition to the previously announced acquisition of two development stage landfills earlier this year, we're pleased to announce recent new market entry acquisitions of solid waste collection operations in Alabama and North Dakota, with combined annualized revenue of almost $20 million. In addition, to further strengthen our E&P waste asset positioning, we acquired a treatment and disposal company with two landfills in the Bakken, with current annualized revenue of about $10 million and ramping, and four additional permitting opportunities in North Dakota, Montana and Wyoming. These transactions, along with other acquisitions we expect to complete over the next few months, provide additional building blocks for growth and margin expansion in 2015."

For earnings history and earnings-related data on Waste Connections (WCN) click here.

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