Casella reports $6.9 million loss for 2016
Casella reports .9 million loss for 2016
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Rutland, Vermont-based Casella Waste Systems Inc. has reported increased revenue for 2016 compared to the year before, but also has reported $6.9 million in net losses for the year, which is an increase of nearly 42 percent from the $4.9 million it lost in 2015.
In its 2016 fourth quarter, Casella says its $143.8 million in revenue was up by 2.7 percent compared to its revenue in the final quarter of 2015. For the year 2016, the company’s $565 million in revenue marked a 3.4 percent increase from full-year revenue in 2015.
While overall in 2016 Casella has reported greater losses, it says its fourth quarter, with a $12 million loss, represented a 70 percent reduction in losses compared to a difficult fourth quarter in 2015.
“We had another strong quarter as we continued to execute well against our key management strategies of increasing landfill returns, improving collection profitability, creating incremental value through resource solutions, and reducing leverage through strict capital discipline and debt repayment,” says John W. Casella, chairman and CEO of the firm.
Despite the overall losses, the CEO cited improved operating income figures as a positive. “The progress we have made on our strategies clearly drove positive financial results in fiscal year 2016, with adjusted operating income up 50.3 percent, adjusted operating income margins up 250 basis points [and] normalized free cash flow up 45.6 percent.”
Adds John Casella, “From an operating standpoint, our disciplined solid waste pricing programs continued to outpace internal inflation, with overall solid waste pricing up 2.6 percent in the [fourth] quarter, driven by strong residential and commercial pricing,” Adds Casella regarding the company’s debt payment strategy, “As previously announced, we refinanced our ABL (asset-based lending) revolver due 2020 and our 7.75 percent senior subordinated notes due 2019, with a new $160 million revolving credit facility and a $350 million term loan B. We believe this transaction positions us well to continue to execute against our strategic plan by reducing our cash interest costs.”
The CEO also points to how the company manages its recycling operations as a reason for optimism. “We have worked hard over the last two years to reshape our recycling sales model in the face of historically low recycling commodity markets with a goal of making a return on our invested capital in all commodity market cycles,” he comments. “We have made great strides in accomplishing this goal through a combination of our sustainability/recycling adjustment fee applied to hauling customers, floating rebates or tipping fees applied to recycling processing customers, and efforts to reduce operating costs at our materials processing facilities.”
Regarding the outlook for 2017, Casella remarks, “Our fiscal year 2017 budget reflects continued execution of our key strategies with the goal of driving additional shareholder value.” The company also predicts revenue growth of between 10 and 15 percent in the recycling business, “driven by higher commodity prices, partially offset by lower processing fees and lower volumes.”
Casella Waste Systems also says it anticipates capital expenditures of between $55 million and $59 million in 2017.
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Source: Recycling Today
Casella reports .9 million loss for 2016
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