Q1 2026 Waste Connections Inc Earnings Call Transcript
Key Points
- Waste Connections Inc (WCN) exceeded expectations for revenue and EBITDA, achieving an EBITDA margin of 32.5%, up 90 basis points year-over-year.
- The company reported a 6% core price increase, providing visibility for the high end of their full-year 2026 outlook.
- Landfill tons were stronger than expected, with special waste tons up 8% year-over-year, marking the sixth consecutive quarter of improvement.
- Employee retention improved for the 14th consecutive quarter, with voluntary turnover dropping below 10%, enhancing operational efficiency.
- Continued investment in AI and digital platforms has shown promising results, with a 20% improvement in customer retention and pricing effectiveness.
- Higher fuel costs impacted internal fuel expenses by about $5 million above expectations for Q1, with a lag in recovery through surcharges.
- The ongoing elevated temperature landfill event at Chiquita Canyon is expected to impact free cash flow by $100 million to $150 million in 2026.
- Despite improvements, construction and demolition (C&D) volumes were down 5%, indicating ongoing weakness in this segment.
- The company faces potential margin dilution due to higher fuel surcharges, which could impact EBITDA margins.
- The implementation of New York City's nonexclusive franchise system is delayed by 6 to 12 months, affecting the timeline for full market integration.
Hello, everyone. Thank you for joining us, and welcome to the Waste Connections Inc Q1 2026 earnings call. (Operator Instructions) I will now hand the conference over to Ron Mittelstaedt, President and CEO. Please go ahead.
Thank you, operator, and good morning. I'd like to welcome everyone to this conference call to discuss our first quarter results. I'm joined this morning by Mary Anne Whitney, our CFO; as well as several other members of our senior management. As noted in our earnings release, we are well positioned for 2026 following a strong start with upside potential from recent trends. We do not -- we not only exceeded expectations for revenue and EBITDA, but delivered EBITDA margin of 32.5%, up 90 basis points year-over-year, excluding commodity impacts in spite of outsized weather impacts and in advance of recovering higher fuel costs.
Against a volatile macroeconomic and geopolitical backdrop, our results reflect the durability of our model and
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