Waste Services Announces Record Third Quarter Results and the Appointment of a New Chairman



    
    - Record third quarter EBITDA.

    - Record third quarter EBITDA margins.

    - Record pre-tax income and net income from continuing operations.

    
    - EPS from continuing operations of $0.08, normalized EPS from continuing
operations of $0.12(1).
    

    - Free cash-flow positive for the third quarter and year-to-date.

    
    BURLINGTON, Ontario, Oct. 21 /PRNewswire-FirstCall/ -- Waste Services,
Inc. (Nasdaq:   WSII) today announced financial results for the three months
ended September 30, 2008.  The quarter was highlighted by:
    

    --  Revenue growth of 1.6% to $125.7 million compared to $123.8 million in
        2007.
    --  Internal revenue growth was 4.3%, made up of 4.4% price, 3.5% fuel and
        environmental surcharge, (3.6)% volume.
    --  The net expiration of municipal contracts accounted for a $3.6 million
        reduction or 3.0%.
    --  Operating income and Adjusted EBITDA expanded to $16.5 million and
        $29.0 million with margins of 13.1% and 23.0%, respectively.

    
    The nine-month results for the period ended September 30, 2008 support
our previous guidance. The year-to-date results are highlighted by:
    
    --  Revenue growth of 9.6% to $370.6 million compared to $338.2 million in
        2007.
    --  Internal revenue growth was 3.4%, made up of 4.2% price, 3.1% fuel and
        environmental surcharge, (3.9)% volume.
    --  Acquisitions net of divestitures added $18.6 million of revenue or
        5.5%, while the net expiration of municipal contracts accounted for a
        $11.3 million reduction or 3.4%.
    --  Operating income and Adjusted EBITDA expanded to $45.5 million and
        $82.8 million with margins of 12.3 % and 22.3 %, respectively.


    
    (1) Normalized EPS is defined as earnings per share as adjusted to
reflect the average statutory income tax rate estimated at 36%.
    

    
    Additionally, Waste Services, Inc. announced that Michael G. DeGroote,
75, has been appointed Chairman of the company effective October 21, 2008.  He
is the father of Michael H. DeGroote and Gary W. DeGroote, both directors of
the company.  Collectively, the DeGroote family owns approximately 28.5% of
our outstanding shares.
    

    
    David Sutherland-Yoest, Waste Services President and Chief Executive
Officer, stated, "I was delighted when Mike DeGroote accepted my invitation to
replace me as Chairman of the Board, an appointment that was confirmed earlier
today.  Mike's exceptional history of successfully developing waste companies,
with his well known focus on overheads, will be of great benefit in assisting
with our cost containment efforts and strategic development.  With our
refinancing behind us, we have commenced a restructuring to reduce our
overheads and intend to complete this in the fourth quarter.  Mike will be of
great assistance to us in pursuing our goal of reducing our corporate overhead
 on an annualized basis by $4-5 million, up to 20 % of our current costs,
resulting in an increase in our earnings per share of 4 to 5 cents per share."
    

    2008 Outlook

    Waste Services revises previously issued guidance for 2008:

    --  Revenue in the range of $470 million to $490 million.
    --  Organic revenue growth continues to range from 3% to 4%.
    --  EBITDA in the range of $100 million to $105 million.
    --  Adjusted EBITDA in the range of $105 million to $110 million.
    --  Operating income to remain as previously guided in the range of $55
        million to $65 million.
    --  Pre-tax income(1) to remain as previously guided in the range of $20
        million to $25 million.
    --  Normalized EPS(1) from continuing operations to remain as previously
        guided in the range of $0.30 to $0.35 per share.
    --  Capital spending continues to be in the range of $55 million to $60
        million.

    
    This guidance assumes no further significant deterioration in economic
conditions in Florida or Canada, and no further significant change in exchange
rates.  Guidance will be adjusted upon announcement of any unusual or
non-recurring items as the year progresses.
    

    1. Normalized EPS is defined as earnings per share as adjusted to reflect
       the average statutory income tax rate estimated at 36%, and excludes
       write-off of finance cost on prior credit facility and other expected
       one-time charges relating to restructuring.

    Reconciliation of Non-GAAP Measures:

    
    The following table reconciles the differences between net income (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,
                                ----------------          -----------------
                                  2008     2007             2008      2007
                                  ----     ----             ----      ----
    Net income (loss) from
     continuing operations      $3,469   $(5,897)          $12,865  $(13,460)
    Income tax provision         5,322     4,474             6,892    10,618
    Interest expense             7,730    10,243            25,770    30,818
    Depreciation, depletion
     and amortization           11,503    15,370            34,826    40,845
                                ------    ------            ------    ------
    EBITDA from continuing
     operations (1)            $28,024   $24,190           $80,353   $68,821
                               =======   =======           =======   =======


    
    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, 2008 and 2007 (in thousands) (unaudited):
    




    For The Three Months       For The Nine Months
    Ended September 30,        Ended September 30,
    ----------------           ----------------
    2008      2007              2008     2007
    ----      ----              ----     ----
    EBITDA from continuing
    operations (1)         $28,024   $24,190           $80,353   $68,821
    Adjustments to EBITDA
    from continuing operations
    (as defined per credit
    agreement):
    Non-cash items (2)     930     1,961             2,473     2,725
    Other excludable
    expenses (3)            -     3,252                 -     4,477
    -----     -----             -----     -----
    Adjusted EBITDA from
    continuing
    operations (1)         $28,954   $29,403           $82,826   $76,023
    =======   =======           =======   =======


    
    (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 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 22, 2008 at 10:00 a.m. (ET) to discuss the results of today's earnings
announcement. If you wish to participate in this call, please phone
866-831-6272 (US and Canada) or 617-213-8859 (International) and enter
passcode number 57390411.  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 5, 2008 by phoning 888-286-8010
(US and Canada) or 617-801-6888 (International) and entering passcode number
26235097.  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, 2007. 
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 www.wasteservicesinc.com.  Information on the company's
website does not form part of this press release.
    



    For information contact:
    Edwin D. Johnson                             J. Todd Atenhan
    Executive Vice President and Chief           Investor Relations
    Financial Officer                            888-917-5105
    Waste Services, Inc.
    561-237-3400


    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,
                                       -------------        -------------
                                        2008     2007      2008      2007
                                        ----     ----      ----      ----
    

    
      Revenue                       $125,745  $123,774   $370,635  $338,194
    

    
      Operating and other expenses:
        Cost of operations
        (exclusive of
         depreciation,
         depletion and
         amortization)                82,512    80,729    242,661   221,995
        Selling, general and
         administrative expense
         (exclusive of
         depreciation, depletion
         and amortization)            15,074    18,205     47,943    47,315
        Depreciation, depletion and
         amortization                 11,503    15,370     34,826    40,845
        Foreign exchange loss
         (gain) and other                135       650       (322)       63
                                         ---       ---       ----        --
    

    
      Income from operations          16,521     8,820     45,527    27,976
      Interest expense                 7,730    10,243     25,770    30,818
                                       -----    ------     ------    ------
    

    
      Income (loss) from continuing
       operations before income
       taxes                           8,791    (1,423)    19,757    (2,842)
      Income tax provision             5,322     4,474      6,892    10,618
                                       -----     -----      -----    ------
    

    
      Net income (loss) from
       continuing operations           3,469    (5,897)    12,865   (13,460)
      Net income from discontinued
       operations, net of income
       tax provision of $301 for the
       nine months ended
       September 30, 2008
       and nil for all other periods       -     1,071        374     1,810
      Gain (loss) on sale of
       discontinued
       operations, net of income tax
       provision of $4,485 for the
       nine months ended
       September 30, 2008
       and nil for all other periods       -      (198)     6,869   (11,452)
                                        ----      ----      -----   -------
    

    
      Net income (loss)               $3,469   $(5,024)   $20,108  $(23,102)
                                      ======   =======    =======  ========
    

    
      Basic and diluted earnings (loss)
       per share:
        Earnings (loss) per share
         - continuing operations       $0.08    $(0.13)     $0.28    $(0.29)
        Earnings (loss) per share
         - discontinued operations         -      0.02       0.16     (0.21)
                                        ----      ----       ----     -----
      Basic and diluted earnings
       (loss) per share                $0.08    $(0.11)     $0.44    $(0.50)
                                       =====    ======      =====    ======
    

    
         Weighted average common
          shares outstanding
            Basic                     46,079    46,007     46,076    45,984
            Diluted                   46,088    46,007     46,085    45,984


    


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


    
        Balance Sheet Data:                    September 30,  December 31,
                                                    2008          2007
                                                    ----          ----
    

    
          Cash                                   $40,995       $20,706
          Current assets                        $110,651       $99,406
          Total assets                          $900,483      $938,488
          Current liabilities                    $94,696       $95,375
          Debt:
            Senior secured credit
             facilities:
                 Revolver                             $-            $-
                 Term loan                       231,410       273,910
            Senior subordinated notes            160,000       160,000
            Other notes                            9,606        10,530
                                                   -----        ------
                      Total debt                $401,016      $444,440
          Shareholders' equity                  $358,242      $350,595
    



    
        Cash Flow Data:
                                              Nine Months Ended September 30,
                                                    2008          2007
                                                    ----          ----
    

    
             Cash flows provided by
           continuing operations                 $48,923        $40,700
          Cash flows provided by (used
           in) investing activities for
           continuing operations                 $14,619       $(69,578)
          Cash flows provided by (used
           in) financing activities of
           continuing operations                $(43,537)       $33,961
          Capital expenditures from
           continuing operations                 $39,220        $45,301


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

    
    Waste Services, Inc.
    Revenue Growth
    For The Three Months Ended
    September 30, 2008
    (in thousands)
    

    
    Total Revenue, September 30, 2007        $123,774
      Impact on revenue from changes in:
        Price                                   9,854     8.0%
        Volume                                 (4,487)   -3.6%
        Acquisition / Disposition                (652)   -0.5%
        Gain / Loss of Contracts               (3,650)   -3.0%
        Other                                    (197)   -0.2%
        Foreign currency impact                 1,103     0.9%
    

    
    Total Revenue, September 30, 2008        $125,745
                                             ========
    



    
    Waste Services, Inc.
    Revenue Growth
    For The Nine Months Ended
    September 30, 2008
    (in thousands)
    

    
    Total Revenue, September 30, 2007        $338,194
      Impact on revenue from changes in:
        Price                                  24,598     7.3%
        Volume                                (13,179)   -3.9%
        Acquisition / Disposition              18,562     5.5%
        Gain / Loss of Contracts              (11,334)   -3.4%
        Other                                  (1,291)   -0.4%
        Foreign currency impact                15,085     4.5%
    

    
    Total Revenue, September 30, 2008        $370,635
                                             ========


    COUNTRY DATA
    (In thousands)
    

    
                                  Three Months Ended September 30, 2008
                                  -------------------------------------
                               US             Canada            Total
                               --             ------            -----
    

    
      Revenue                $58,468  100.0%  $67,277  100.0% $125,745  100.0%
      Operating expenses:
        Cost of operations    38,114   65.2%   44,398   66.0%   82,512   65.6%
        Selling, general
         and administrative
         expense               7,647   13.1%    7,427   11.0%   15,074   12.0%
        Depreciation,
         depletion and
         amortization          6,509   11.1%    4,994    7.4%   11,503    9.1%
        Foreign exchange
         gain and other           20    0.0%      115    0.2%      135    0.2%
                                  --              ---              ---
      Income from
       continuing
       operations             $6,178   10.6%  $10,343   15.4%  $16,521   13.1%
                              ======          =======          =======
    






    
                                  Three Months Ended September 30, 2007
                                  -------------------------------------
                               US             Canada            Total
                               --             ------            -----
    

    
      Revenue                $63,785  100.0%  $59,989  100.0% $123,774  100.0%
      Operating expenses:
        Cost of operations    41,084   64.4%   39,645   66.1%   80,729   65.2%
        Selling, general
         and administrative
         expense               7,338   11.5%    6,872   11.5%   14,210   11.5%
        Severance and
         related
        costs                  3,995    6.3%        -    0.0%    3,995    3.2%
        Depreciation,
         depletion and
         amortization         10,231   16.0%    5,139    8.6%   15,370   12.4%
        Foreign exchange
         gain and other          684    1.1%      (34)  -0.1%      650    0.6%
                                 ---              ---              ---
      Income from
       continuing
       operations               $453    0.7%   $8,367   13.9%   $8,820    7.1%
                                ====           ======           ======


    

    
    WASTE SERVICES, INC.
    UNAUDITED COUNTRY DATA- (Continued)
    (In thousands)
    

    
                                   Nine Months Ended September 30, 2008
                                   ------------------------------------
                               US             Canada            Total
                               --             ------            -----
    

    
      Revenue               $179,331  100.0% $191,304  100.0% $370,635  100.0%
      Operating expenses:
        Cost of operations   116,497   65.0%  126,164   65.9%  242,661   65.5%
        Selling, general
         and administrative
         expense              24,055   13.4%   23,888   12.5%   47,943   12.9%
        Depreciation,
         depletion
         and amortization     19,903   11.1%   14,923    7.8%   34,826    9.4%
        Foreign exchange
         (gain)
         loss and other         (463)  -0.3%      141    0.1%     (322)  -0.1%
                                ----              ---             ----
      Income from
       continuing operations $19,339   10.8%  $26,188   13.7%  $45,527   12.3%
                             =======          =======          =======
    



    
                                   Nine Months Ended September 30, 2007
                                   ------------------------------------
                               US             Canada            Total
                               --             ------            -----
    

    
      Revenue               $177,546  100.0% $160,648  100.0% $338,194  100.0%
      Operating expenses:
        Cost of operations   114,921   64.7%  107,074   66.7%  221,995   65.6%
        Selling, general
         and administrative
         expense              23,516   13.2%   19,804   12.3%   43,320   12.8%
        Severance and
         related costs         3,995    2.3%        -    0.0%    3,995    1.2%
        Depreciation,
         depletion
         and amortization     26,769   15.1%   14,076    8.8%   40,845   12.1%
        Foreign exchange
         gain and other          350    0.2%     (287)  -0.2%       63    0.0%
                                 ---             ----               --
      Income from
       continuing operations  $7,995    4.5%  $19,981   12.4%  $27,976    8.3%
                              ======          =======          =======



    




For further information:

For further information: Edwin D. Johnson, Executive Vice President and
Chief Financial Officer of Waste Services, Inc., +1-561-237-3400, or J. Todd
Atenhan, Investor Relations, 1-888-917-5105 Web Site:
http://www.wasteservicesinc.com

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