0001318220false00013182202020-10-292020-10-29

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant To Section 13 or 15 (d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 29, 2020

Waste Connections, Inc.

(Exact name of registrant as specified in its charter)

Ontario, Canada

    

1-34370

    

98-1202763

(State or other jurisdiction
of Incorporation)

(Commission
File Number)

(I.R.S. Employer
Identification No.)

610 Applewood Crescent, 2nd Floor

Vaughan

Ontario L4K 0E3

Canada

(Address of principal executive offices)

Registrant’s telephone number, including area code: (905) 532-7510

Not Applicable

(Former name or address, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares, no par value

WCN

New York Stock Exchange (“NYSE”)
Toronto Stock Exchange (“TSX”)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 7.01  Regulation FD Disclosure.

During our earnings conference call on October 29, 2020, we highlighted the following outlook for the fourth quarter 2020.

(Dollar amounts are approximations)

For the fourth quarter of the year, we estimate our revenue to be approximately $1.335 billion. We expect solid waste price to be approximately 4.0% and volume growth to be approximately negative 6.0%.  Net income attributable to Waste Connections is estimated to be approximately $136.8 million. Adjusted EBITDA, as reconciled below, is estimated to be approximately $400 million.

Q4 2020 OUTLOOK

NON-GAAP RECONCILIATION SCHEDULE

(in thousands of U.S. dollars, except where noted)

Reconciliation of Adjusted EBITDA:

Q4 2020 Outlook

Estimates

Observation

Net income attributable to Waste Connections

$

136,750

Plus: Income tax provision

35,300

Approximately 20.5% effective rate

Plus: Interest expense, net of interest income

40,000

Plus: Depreciation and depletion

151,700

Approximately 11.4% of revenue

Plus: Amortization

32,500

Approximately 2.4% of revenue, or $0.09 per diluted share net of taxes

Plus: Closure and post-closure accretion

3,750

Adjusted EBITDA

$

400,000

Approximately 30.0% of revenue

These estimates assume no significant change in underlying economic trends.  They also exclude any impact from additional acquisitions that may close during the remainder of the year, and expensing of transaction-related items during the period.

We also provided preliminary thoughts for full year 2021, which assume no change in the current economic environment.  We believe that 2021 likely sets up for solid waste price growth to range between about 3.5% and 4%, with volumes expected to turn positive after we anniversary the start of the pandemic. Price-led organic growth and high flow thru from improving volumes should drive underlying margin expansion in solid waste collection, transfer and disposal in spite of the hopeful return of certain discretionary expenses we either reduced or eliminated this year due to the pandemic, or the normalization of other expenses that declined as a result of the shutdowns. In addition, depending on the level of activity between now and year end, we could enter 2021 with more than 2% in revenue growth in place from completed acquisitions.

Adjusted EBITDA, a non-GAAP financial measure, is provided supplementally because it is widely used by investors as a performance and valuation measure in the solid waste industry.  Management uses adjusted EBITDA as one of the principal measures to evaluate and monitor the ongoing financial performance of our operations.  We define adjusted EBITDA as net income attributable to Waste Connections, minus net loss attributable to noncontrolling interests, plus income tax provision, plus interest expense, less interest income, plus depreciation and amortization expense, plus closure and post-closure accretion expense, plus or minus any loss or gain on impairments and other operating items, plus other expense, less other income.  We further adjust this calculation to exclude the effects of other items management believes impact the ability to assess the operating performance of our business.  This measure is not a substitute for, and should be used in conjunction with, GAAP financial measures.  Other companies may calculate adjusted EBITDA differently.

The information furnished in Item 7.01 is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, is not subject to the liabilities of that section, and is not deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Safe Harbor and Forward-Looking Information

This document contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 (“PSLRA”), including “forward-looking information” within the meaning of applicable Canadian securities laws. These forward-looking statements are neither historical facts nor assurances of future performance and reflect Waste Connections’ current beliefs and expectations regarding future events and operating performance. These forward-looking statements are often identified by the words “may,” “might,” “believes,” “thinks,” “expects,” ”estimate,” “continue,” “intends” or other words of similar meaning. All of the forward-looking statements included in this document are made pursuant to the safe harbor provisions of the PSLRA and applicable securities laws in Canada. Forward-looking statements involve risks and uncertainties. Forward-looking statements in this document include, but are not limited to, statements about expected fourth quarter 2020 outlook for financial results and preliminary thoughts for full year 2021 financial results. Important factors that could cause actual results to differ, possibly materially, from those indicated by the forward-looking statements include, but are not limited to, risk factors detailed from time to time in the Company’s filings with the SEC and the securities commissions or similar regulatory authorities in Canada.  You should not place undue reliance on forward-looking statements, which speak only as of the date of this document.  Waste Connections undertakes no obligation to update the forward-looking statements set forth in this document, whether as a result of new information, future events, or otherwise, unless required by applicable securities laws.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

WASTE CONNECTIONS, INC.

Date: October 29, 2020

BY:

/s/ Mary Anne Whitney

Mary Anne Whitney

Senior Vice President and Chief Financial Officer