Casella Waste Systems Inc. (CWST, Financial) filed Quarterly Report for the period ended 2009-07-31.
Casella Waste Systems Inc. is a regional integrated solid waste services company that provides collection transfer disposal and recycling services generates steam and manufactures finished products utilizingrecyclable materials primarily throughout the eastern portion of the UnitedStates and parts of Canada. The Company also markets recyclable metalsaluminum plastics paper and corrugated cardboard all processed at itsfacilities and recyclables purchased from third parties. Casella Waste Systems Inc. has a market cap of $64.9 million; its shares were traded at around $2.53 with a P/E ratio of 50.6 and P/S ratio of 0.1.
Eastern region revenues for the quarter ended July 31, 2009 declined $4.8 million, or 9.0%, from the same period last year primarily due to the idling of a construction and demolition processing plant as well as lower fuel recovery fees. Also contributing to the revenue decline were lower volumes and prices from disposal facilities and lower volumes from collection operations, partially offset by collection price increases. Western region revenues for the quarter ended July 31, 2009 decreased $5.4 million or 17.7%, from the same period last year, due to lower landfill prices and volumes as well as lower collection volumes and fuel recovery fees, partially offset by collection price increases. In addition the revenue declines were attributable to lower commodity price and volumes from its scrap metal operation. Central region revenues for the quarter ended July 31, 2009 decreased $3.7 million or 11.2%, from the same period last year, due to lower collection and landfill volumes and the effect of lower commodity prices and lower fuel recovery fees. Revenue declines from the planned closure of the Colebrook landfill, which ceased operations in August 2008, were $1.4 million compared to the prior year period. These decreases were partially offset by collection price increases, the positive effect of tuck-in acquisitions and the start-up of the landfill-gas-to-energy facility at the Clinton County landfill.
Operating income for the quarter ended July 31, 2009 was $9.4 million compared to $15.6 million in the prior year comparable period and decreased as a percentage of revenue to 6.9% from 9.9%. Operating income declined primarily due to lower revenue levels, partially offset by lower operating and general administration costs. FCR recycling operating income decreased $3.1 million compared to the prior year period as lower net revenues, due to the impact of lower commodity prices and volumes, and higher depreciation expense, were partially offset by a decrease in purchased material costs. Operating income for the Eastern region decreased $2.3 million, due to lower revenue volumes and increased landfill amortization expenses primarily due to higher amortizations rates associated with the planned ramp-down of landfill volumes at the Pine Tree landfill. These decreases were partially offset by lower operating costs. Also in the prior year, operating income reflected a favorable impact of a $0.8 million benefit from a reimbursement from the Town of Southbridge for previously paid and expensed closure and post closure costs at the Southbridge landfill site. Western region operating income decreased $0.9 million compared to the prior year period due to lower revenue, partially offset by lower operating costs and landfill amortization. Central region operating income increased slightly year over year as lower revenues were more than offset by lower operating costs and landfill amortization.
Revenues - Revenues decreased $22.0 million, or 14.0%, to $135.9 million in the quarter ended July 31, 2009 from $157.9 million in the quarter ended July 31, 2008. Solid waste revenues, including the Companys major accounts program, decreased $13.0 million, with $9.8 million coming from volume decreases in our collection and landfill operations, $3.8 million of the decrease from lower fuel recovery fees and $2.1 million from lower commodity prices and volumes within the solid waste group. These decreases were partially offset by price increases in our collection operations of $2.3 million and the rollover effect of acquisitions of $0.4 million. FCR recycling revenues decreased $9.0 million mainly due to sharp declines in commodity prices and to a lesser extent, lower volumes.
Cost of operations - Cost of operations decreased $13.8 million, or 13.2%, to $90.6 million in the quarter ended July 31, 2009 from $104.4 million in the quarter ended July 31, 2008 and remained relatively consistent as a percentage of revenue between periods. The dollar decrease in cost of operations is attributable to a decrease in the cost of purchased materials associated with lower recycling revenues as well as lower fuel costs and direct labor partially offset by a benefit in the prior year period of $0.8 million related to the reimbursement from the Town of Southbridge for previously paid and expensed closure and post closure costs at the Southbridge landfill site.
On July 9, 2009, the Company completed the refinancing of its existing senior credit facility with a Senior Secured Credit Facility, consisting of a $177.5 million revolving credit facility (the New Revolver), a $130.0 million aggregate principal term loan (the New Term Loan) and the offering of $180.0 million aggregate principal amount of Second Lien Notes. The net proceeds from the Senior Secured Credit Facility and from the Second Lien Notes offering were used to refinance the borrowings under the Companys $525.0 million existing senior credit facility due April 2010.
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Casella Waste Systems Inc. is a regional integrated solid waste services company that provides collection transfer disposal and recycling services generates steam and manufactures finished products utilizingrecyclable materials primarily throughout the eastern portion of the UnitedStates and parts of Canada. The Company also markets recyclable metalsaluminum plastics paper and corrugated cardboard all processed at itsfacilities and recyclables purchased from third parties. Casella Waste Systems Inc. has a market cap of $64.9 million; its shares were traded at around $2.53 with a P/E ratio of 50.6 and P/S ratio of 0.1.
Highlight of Business Operations:
On July 9, 2009, the Company completed (i) the refinancing of its existing senior credit facility with a senior secured first lien credit facility (the Senior Secured Credit Facility), consisting of a $177.5 million revolving credit facility and a $130.0 million aggregate principal term loan and (ii) the placement of $180.0 million aggregate principal amount of 11% senior second lien notes due 2014 (the Second Lien Notes). The net proceeds from the Senior Secured Credit Facility and from the Second Lien Notes offering were used to refinance the borrowings under the $525.0 million senior credit facility due April 2010.Eastern region revenues for the quarter ended July 31, 2009 declined $4.8 million, or 9.0%, from the same period last year primarily due to the idling of a construction and demolition processing plant as well as lower fuel recovery fees. Also contributing to the revenue decline were lower volumes and prices from disposal facilities and lower volumes from collection operations, partially offset by collection price increases. Western region revenues for the quarter ended July 31, 2009 decreased $5.4 million or 17.7%, from the same period last year, due to lower landfill prices and volumes as well as lower collection volumes and fuel recovery fees, partially offset by collection price increases. In addition the revenue declines were attributable to lower commodity price and volumes from its scrap metal operation. Central region revenues for the quarter ended July 31, 2009 decreased $3.7 million or 11.2%, from the same period last year, due to lower collection and landfill volumes and the effect of lower commodity prices and lower fuel recovery fees. Revenue declines from the planned closure of the Colebrook landfill, which ceased operations in August 2008, were $1.4 million compared to the prior year period. These decreases were partially offset by collection price increases, the positive effect of tuck-in acquisitions and the start-up of the landfill-gas-to-energy facility at the Clinton County landfill.
Operating income for the quarter ended July 31, 2009 was $9.4 million compared to $15.6 million in the prior year comparable period and decreased as a percentage of revenue to 6.9% from 9.9%. Operating income declined primarily due to lower revenue levels, partially offset by lower operating and general administration costs. FCR recycling operating income decreased $3.1 million compared to the prior year period as lower net revenues, due to the impact of lower commodity prices and volumes, and higher depreciation expense, were partially offset by a decrease in purchased material costs. Operating income for the Eastern region decreased $2.3 million, due to lower revenue volumes and increased landfill amortization expenses primarily due to higher amortizations rates associated with the planned ramp-down of landfill volumes at the Pine Tree landfill. These decreases were partially offset by lower operating costs. Also in the prior year, operating income reflected a favorable impact of a $0.8 million benefit from a reimbursement from the Town of Southbridge for previously paid and expensed closure and post closure costs at the Southbridge landfill site. Western region operating income decreased $0.9 million compared to the prior year period due to lower revenue, partially offset by lower operating costs and landfill amortization. Central region operating income increased slightly year over year as lower revenues were more than offset by lower operating costs and landfill amortization.
Revenues - Revenues decreased $22.0 million, or 14.0%, to $135.9 million in the quarter ended July 31, 2009 from $157.9 million in the quarter ended July 31, 2008. Solid waste revenues, including the Companys major accounts program, decreased $13.0 million, with $9.8 million coming from volume decreases in our collection and landfill operations, $3.8 million of the decrease from lower fuel recovery fees and $2.1 million from lower commodity prices and volumes within the solid waste group. These decreases were partially offset by price increases in our collection operations of $2.3 million and the rollover effect of acquisitions of $0.4 million. FCR recycling revenues decreased $9.0 million mainly due to sharp declines in commodity prices and to a lesser extent, lower volumes.
Cost of operations - Cost of operations decreased $13.8 million, or 13.2%, to $90.6 million in the quarter ended July 31, 2009 from $104.4 million in the quarter ended July 31, 2008 and remained relatively consistent as a percentage of revenue between periods. The dollar decrease in cost of operations is attributable to a decrease in the cost of purchased materials associated with lower recycling revenues as well as lower fuel costs and direct labor partially offset by a benefit in the prior year period of $0.8 million related to the reimbursement from the Town of Southbridge for previously paid and expensed closure and post closure costs at the Southbridge landfill site.
On July 9, 2009, the Company completed the refinancing of its existing senior credit facility with a Senior Secured Credit Facility, consisting of a $177.5 million revolving credit facility (the New Revolver), a $130.0 million aggregate principal term loan (the New Term Loan) and the offering of $180.0 million aggregate principal amount of Second Lien Notes. The net proceeds from the Senior Secured Credit Facility and from the Second Lien Notes offering were used to refinance the borrowings under the Companys $525.0 million existing senior credit facility due April 2010.
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