Q3 2023 Earnings Summary
Reported on Oct 25, 2023 (After Market Close)
Pre-Earnings Price$164.07Last close (Oct 25, 2023)
Post-Earnings Price$164.12Open (Oct 26, 2023)
Price Change
$0.05(+0.03%)
- Strong Margin Expansion and Cost Optimization: Waste Management achieved a record operating EBITDA margin of 29.6% in Q3 2023, a 100 basis point improvement compared to the same period last year. This growth was driven by a 70 basis point improvement in the collection and disposal business and 20 basis points from SG&A leverage. ,
- Operational Efficiencies through Technology and Reduced Turnover: The company is leveraging technology and automation to enhance operations, reducing headcount by 1,650 positions since January 2022 through attrition. Improved labor efficiency and reduced turnover have led to positive impacts on safety and efficiency metrics across business lines. , ,
- Advancement of Sustainability Growth Projects: Waste Management is progressing with its sustainability initiatives, maintaining a commitment to approximately $750 million in sustainability growth capital spending for 2023. The company plans to catch up on any delayed spending over the next two to three quarters, signaling strong future growth in renewable natural gas and recycling projects. ,
- Waste Management experienced a 50 basis point headwind due to the timing of the alternative fuel tax credit, negatively impacting margins in the third quarter.
- Dilutive impact from recent M&A activities, particularly in recycling brokerage acquisitions, resulted in a negative impact on margins of 40 basis points in the first half and 20 basis points in the third quarter.
- A $150 million delay in sustainability growth capital spending is shifting investments into 2024 and 2025, potentially affecting the timeline of expected growth from these projects.
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