Waste Services Announces Record Third Quarter Results



    
    -- Record Revenue and Adjusted EBITDA.

    -- Record Adjusted EBITDA margins.

    -- Internal revenue growth from price and volume for the quarter of 4.4%.
    

    BURLINGTON, Canada, Oct. 30 /CNW/ -- Waste Services, Inc. (Nasdaq:   WSII)
today announced financial results for the three months ended September 30,
2007.  The quarter was highlighted by strong top line growth and continued
margin expansion:

    
    *  Revenue growth of 25.9% to $130.6 million compared to $103.7 million in
       2006.
    *  Internal revenue growth was 4.4%, made up of 4.1% price, 0.3% volume.
    *  Acquisitions net of divestitures added $22.1 million of revenue or
       21.3%, while the net expiration of municipal contracts accounted for a
       $2.9 million reduction or 2.8%.
    *  Operating income and Adjusted EBITDA expanded to $9.9 million and $31.2
       million with margins of 7.6% and 23.9%, respectively.
    
    David Sutherland-Yoest, Waste Services Chairman and Chief Executive
Officer, stated, "We are pleased with our record quarterly results as we
continue to execute our strategic initiatives both domestically and in Canada.
While certain economic conditions in the Florida housing market continue to be
challenging, we are well positioned for earnings and revenue growth both in
the U.S. and Canada.  Our Canadian based operations continue to exceed
expectations and we are well poised to finish the year strongly."
    The September 30, 2007 year-to-date results are highlighted by:

    
      *  Revenue growth of 22.8% to $358.2 million compared to $291.7 million
         in 2006.
      *  Internal revenue growth was 5.1 %, made up of 5.0% price, 0.1%
         volume.
      *  Acquisitions net of divestitures added $51.7 million of revenue or
         17.7%, while the expiration of low margin municipal contracts net of
         new higher margin municipal contracts accounted for a $4.6 million
         reduction or 1.6%.
      *  Operating income and Adjusted EBITDA expanded to $30.9 million and
         $81.3 million with margins improving to 8.6% and 22.7%, respectively.
    

    
    Reconciliation of Non-GAAP Measures:
    
    The following table reconciles the differences between net loss, as
determined under US GAAP, and EBITDA from continuing operations, a non-GAAP
financial measure (in thousands) (unaudited):


    
                                   For The Three Months    For The Nine Months
                                     Ended September 30,   Ended September 30,
                                      2007        2006        2007       2006
    Net loss from continuing
     operations                     $(4,826)    $(8,133)   $(10,520) $(37,138)
    Income tax provision              4,474       4,045      10,618     8,386
    Preferred stock dividends
     and amortization of issue
     costs                                -       4,256           -    14,793
    Interest expense                 10,243       7,996      30,818    22,876
    Depreciation, depletion
     and amortization                16,143      10,602      43,234    29,694
    EBITDA from continuing
     operations (1)                 $26,034     $18,766     $74,150   $38,611
    
    The following table reconciles the differences between EBITDA and
Adjusted EBITDA, as defined in our credit agreement, for the three and nine
months ended September 30, 2007 and 2006 (in thousands) (unaudited):


    
                                    For The Three Months   For The Nine Months
                                    Ended September 30,    Ended September 30,
                                     2007         2006      2007         2006
    EBITDA from continuing
     operations (1)                $26,034      $18,766   $74,150      $38,611
    Adjustments to EBITDA from
     continuing operations
      (as defined per credit
      agreement):
          Non-cash items (2)         1,949        1,254     2,713       10,518
          Other excludable
           expenses (3)              3,252        2,002     4,477        5,332
    Adjusted EBITDA from
     continuing operations (1)     $31,235      $22,022   $81,340      $54,461
    



    
    (1)  EBITDA from continuing operations and EBITDA from continuing
         operations as defined in our credit agreement ("Adjusted EBITDA from
         continuing operations") are non-GAAP measures used by management to
         measure performance. We also believe that EBITDA from continuing
         operations and Adjusted EBITDA from continuing operations may be used
         by certain investors to analyze and compare our operating performance
         between accounting periods and against the operating results of other
         companies that have different financing and capital structures or tax
         rates and to measure our ability to service our debt.  In addition,
         management uses EBITDA from continuing operations, among other
         things, as an internal performance measure.  Our lenders also use
         Adjusted EBITDA from continuing operations to measure our ability to
         service and/or incur additional indebtedness under our credit
         facilities.  However, EBITDA from continuing operations and Adjusted
         EBITDA from continuing operations should not be considered in
         isolation or as a substitute for net income, cash flows or other
         financial statement data prepared in accordance with US GAAP or as a
         measure of our performance, profitability or liquidity.  EBITDA from
         continuing operations and Adjusted EBITDA from continuing operations
         are not calculated under US GAAP and therefore are not necessarily
         comparable to similarly titled measures of other companies.
    

    
    (2)  Non-cash adjustments primarily include impairment of deferred
         acquisition costs, stock-based compensation expense and gains and
         losses on foreign exchange and asset sales.
    

    
    (3)  Other excludable expenses adjustments include professional fees for
         certain litigation, severance and other non-recurring costs.
    
    We will host an investor and analyst conference call on Wednesday,
October 31, 2007 at 8:30 a.m. (ET) to discuss the results of today's earnings
announcement.  If you wish to participate in this call, please phone 866-761-
0749 (US and Canada) or 617-614-2707 (International) and enter passcode number
49978114.  To hear a web cast of the call over the Internet, access the Home
page of our website at www.wasteservicesinc.com.  A post-view of the call will
be available until November 14, 2007 by phoning 888-286-8010 (US and Canada)
or 617-801-6888 (International) and entering passcode number 97716015.  The
web cast will also be available on our website.
    
    Safe Harbor for Forward-Looking Statements
    
    Certain matters discussed in this press release are "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934.  These statements
describe the company's future plans, objectives and goals.  These forward-
looking statements involve risks and uncertainties which could cause actual
results to differ materially from the plans, objectives and goals set forth in
this press release.  Factors which could materially affect such forward-
looking statements can be found in the company's periodic reports filed with
the Securities and Exchange Commission, including risk factors detailed in the
company's Form 10-K for the year ended December 31, 2006.  Shareholders,
potential investors and other readers are urged to consider these factors
carefully in evaluating the forward-looking statements and are cautioned not
to place undue reliance on such forward-looking statements.
    The forward-looking statements made in this press release are only made
as of the date hereof and Waste Services undertakes no obligation to publicly
update such forward-looking statements to reflect subsequent events or
circumstances.
    This release does not constitute an offer to sell or the solicitation of
any offer to buy any securities.  The company's securities may not be offered
or sold in the United States absent a registration or applicable exemption
from registration requirements under applicable state and federal securities
laws.
    Waste Services, Inc., a Delaware corporation, is a multi-regional,
integrated solid waste services company that provides collection, transfer,
disposal and recycling services in the United States and Canada.  The
company's website is http://www.wasteservicesinc.com.  Information on the
company's website does not form part of this press release.



    
                             WASTE SERVICES, INC.
          UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In thousands, except per share data)
    


    
                                      Three Months Ended     Nine Months Ended
                                         September 30,         September 30,
                                       2007        2006       2007      2006
    

    Revenue                           $130,605  $103,739   $358,158  $291,703

    
    Operating and other expenses:
      Cost of operations
       (exclusive of depreciation,
       depletion and amortization)      85,346    70,312    235,478   201,373
      Selling, general and
       administrative expense
       (exclusive of depreciation,
       depletion and amortization)      18,587    14,753    48,479     44,083
      Deferred acquisition costs             -         -         -      5,612
      Depreciation, depletion and
       amortization                     16,143    10,602    43,234     29,694
      Foreign exchange loss (gain)
       and other                           638       (92)       51      2,024
    

    
    Income from operations               9,891     8,164    30,916      8,917
    Interest expense                    10,243     7,996    30,818     22,876
    Cumulative mandatorily
     redeemable preferred stock
     dividends and amortization
     of issue costs                          -     4,256         -    14,793
    

    
    Income (loss) from continuing
     operations before income taxes       (352)   (4,088)       98   (28,752)
    Income tax                           4,474     4,045    10,618     8,386
    Net loss from continuing
     operations                         (4,826)   (8,133)  (10,520)  (37,138)
    Net loss from discontinued
     operations, net of tax of $0            -      (460)   (1,130)   (1,297)
    Loss on sale of discontinued
     operations, net of tax of $0         (198)        -   (11,452)        -
    

    Net loss                           $(5,024)  $(8,593) $(23,102) $(38,435)

    
    Basic and diluted loss
     per share:
       Loss per share -
        continuing operations$           (0.11)   $(0.23)   $(0.23)   $(1.08)
       Loss per share -
        discontinued operations              -     (0.01)    (0.27)    (0.03)
    Basic and diluted loss
     per share                          $(0.11)   $(0.24)   $(0.50)   $(1.11)
    

    
       Weighted average common
        shares outstanding -
        basic and diluted               46,007    36,066    45,984    34,534
    



    
                            "WASTE SERVICES, INC.
           SUPPLEMENTAL UNAUDITED BALANCE SHEET AND CASH FLOW DATA
                                (In thousands)
    


    
    Balance Sheet Data:                         September 30,     December 31,
                                                    2007             2006
    

    
             Cash                                  $15,998             $8,532
             Current assets                        $97,318            $71,119
             Total assets                         $938,042           $865,063
             Current liabilities                   $98,395            $86,358
             Debt:
                 Senior secured credit facilities:
                           Revolver                     $-                 $-
                           Term loan               273,910            245,260
                 Senior subordinated notes         160,000            160,000
                 Other notes                        10,827              4,828
                                Total debt        $444,737           $410,088
             Shareholders' equity                 $349,230           $339,357
    


    
    Cash Flow Data:
                                                   Period Ended September 30,
                                                    2007               2006
    

    
             Cash flows provided by
              continuing operations                $45,786            $24,700
             Cash flows used in
              investing activities for
              continuing operations               $(72,901)          $(61,980)
             Cash flows from financing
              activities of continuing
              operations                           $33,961            $28,608
             Capital expenditures from
              continuing operations                $48,624            $37,007
    



    
                             WASTE SERVICES, INC.
        SUPPLEMENTAL UNAUDITED INTERNAL GROWTH RATES AND COUNTRY DATA
                                (In thousands)
    


    
                             Waste Services, Inc.
                           Internal Revenue Growth
                   For The Quarter Ended September 30, 2007
                                (in thousands)
    


    
    Total Revenue, September 30, 2006         $103,739
      Impact on revenue from changes in:
        Price                                    4,252            4.1%
        Volume                                     327            0.3%
        Acquisition / Disposition               22,100           21.3%
        Gain / Loss of Contracts                (2,933)          -2.8%
        Other                                     (461)          -0.4%
        Foreign currency impact                  3,581            3.5%
    

    Total Revenue, September 30, 2007         $130,605



    
                             Waste Services, Inc.
                           Internal Revenue Growth
                 For The Nine Months Ended September 30, 2007
                                (in thousands)
    

    
    Total Revenue, September 30, 2006               $291,703
      Impact on revenue from changes in:
        Price                                        14,706            5.0%
        Volume                                          240            0.1%
        Acquisition / Disposition                    51,734           17.7%
        Gain / Loss of Contracts                     (4,558)          -1.6%
        Other                                           514            0.2%
        Foreign currency impact                       3,819            1.3%
    

    Total Revenue, September 30, 2007               $358,158



    
                                 COUNTRY DATA
                                (In thousands)
    


    
                                 Three Months Ended September 30, 2007
                             US             Canada            Total
    

    
    Revenue                $70,616  100.0%  $59,989  100.0%  $130,605  100.0%
    Operating expenses:
     Cost of operations     45,701   64.7%   39,645   66.1%    85,346   65.3%
     Selling, general and
      administrative
      expense                7,720   10.9%    6,872   11.5%    14,592   11.2%
     Severance and related
      costs                  3,995    5.7%        -    0.0%     3,995    3.1%
     Depreciation,
      depletion and
      amortization          11,004   15.6%    5,139    8.6%    16,143   12.4%
     Foreign exchange gain
      and other                672    0.9%      (34)  -0.1%       638    0.4%
    Income from continuing
     operations             $1,524    2.2%   $8,367   13.9%    $9,891    7.6%
    



    
                                 Three Months Ended September 30, 2006
                             US             Canada            Total
    

    
    Revenue                $51,910  100.0%  $51,829  100.0%  $103,739  100.0%
    Operating expenses:
     Cost of operations     35,122   67.6%   35,190   67.9%    70,312   67.8%
     Selling, general and
      administrative
      expense                9,088   17.5%    5,665   10.9%    14,753   14.2%
     Depreciation,
      depletion and
      amortization           6,103   11.8%    4,499    8.7%    10,602   10.2%
     Foreign exchange
      (gain) loss and
      other                    (62)  -0.1%      (30)  -0.1%       (92)  -0.1%
    Income from continuing
     operations             $1,659    3.2%   $6,505   12.6%    $8,164    7.9%
    



    
                                 Nine Months Ended September 30, 2007
                            US              Canada            Total
    

    
    Revenue              $197,510  100.0%  $160,648  100.0%  $358,158  100.0%
    Operating expenses:
     Cost of operations   128,404   65.0%   107,074   66.7%   235,478   65.7%
     Selling, general
      and administrative
      expense              24,680   12.5%    19,804   12.3%    44,484   12.4%
     Severance and
      related costs         3,995    2.0%         -    0.0%     3,995    1.1%
     Depreciation,
      depletion and
      amortization         29,158   14.8%    14,076    8.8%    43,234   12.1%
     Foreign exchange
      gain and other          338    0.2%      (287)  -0.2%        51    0.1%
    Income from
     continuing
     operations           $10,935    5.5%   $19,981   12.4%   $30,916    8.6%
    



    
                                 Nine Months Ended September 30, 2006
                            US              Canada            Total
    

    
    Revenue              $152,940  100.0%  $138,763  100.0%  $291,703  100.0%
    Operating expenses:
     Cost of operations   106,196   69.4%    95,177   68.6%   201,373   69.0%
     Selling, general
      and administrative
      expense              26,616   17.4%    17,467   12.6%    44,083   15.1%
     Deferred
      acquisition costs       439    0.3%     5,173    3.7%     5,612    1.9%
     Depreciation,
      depletion and
      amortization         16,976   11.1%    12,718    9.2%    29,694   10.2%
     Foreign exchange
      (gain) loss and
      other                    28    0.0%     1,996    1.4%     2,024    0.7%
    Income (loss) from
     continuing
     operations            $2,685    1.8%    $6,232    4.5%    $8,917    3.1%
    




For further information:

For further information: Edwin D. Johnson, Executive Vice President and 
Chief Financial Officer of Waste Services, Inc., +1-561-237-3400 Web Site:
http://www.wasteservicesinc.com

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