Casella Waste Systems, Inc. Announces Fourth Quarter and Fiscal Year 2014 Results; and Provides Guidance

Company Also Says It Will Change Its Fiscal Year-End From April 30th to December 31st to Better Align Its Business Cycle to Its Fiscal Year

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| Source: Casella Waste Systems, Inc.

RUTLAND, Vt., June 25, 2014 (GLOBE NEWSWIRE) -- Casella Waste Systems, Inc. (Nasdaq:CWST), a regional solid waste, recycling and resource management services company, today reported financial results for the quarter and fiscal year ended April 30, 2014. The company also announced its plan to change to a December 31st fiscal year-end, and shared guidance for the 8-month transition period ending December 31, 2014, and its 12-month fiscal year ending December 31, 2015.

Fourth Quarter and Fiscal Year 2014 Financial Highlights

  • Revenue growth for the current quarter was $10.2 million, or 9.4 percent, from the same quarter last year. For fiscal year 2014, revenue growth was $42.3 million, or 9.3 percent, from the same period last year.
  • Overall solid waste pricing growth for the fourth quarter was 0.5 percent, primarily driven by positive collection pricing growth of 1.5 percent as a percentage of collection revenues.
  • Adjusted EBITDA* was $19.0 million for the current quarter, down $0.4 million from the same quarter last year. For fiscal year 2014, Adjusted EBITDA was $95.1 million, up $7.3 million from the same period last year.
  • Free Cash Flow* for fiscal year 2014, was $1.3 million, up $13.5 million from the same period last year.

"We made excellent progress against our long-term goals during the fiscal year," said John W. Casella, chairman and CEO of Casella Waste Systems, said. "We delivered on each of our major strategic priorities – getting additional volumes into our landfills, improving collection route profitability, furthering our long-term Eastern region strategy to improve our business positioning and margins, and driving high-return revenue growth through our customer solutions offerings. As a result, Adjusted EBITDA and Free Cash flow were both up significantly year-over-year."

"While we're happy with our progress, we still have quite a bit of work to do as a team over the next few years to drive higher cash flows and returns for our investors," Casella said.

For the current quarter, revenues were $118.9 million, up $10.2 million, or 9.4 percent, from the same quarter last year, with revenue growth mainly driven by higher solid waste volumes, higher solid waste collection pricing, customer solutions growth, and acquisition activity. Overall solid waste pricing growth of 0.5 percent was primarily driven by residential and commercial pricing growth of 2.2 percent as a percentage of segment revenues.

Operating loss was ($6.0) million for the current quarter, compared to operating income of $2.1 million from the same quarter last year. The current quarter includes a $7.5 million non-cash asset impairment charge related to the shutdown of the C.A.R.E.S water treatment facility in early May 2014, $0.4 million of severance and reorganization costs, and a $1.1 million non-cash gain on the settlement of contingent consideration related to the acquisition of an industrial services company in September 2013.

By comparison, the quarter ended April 30, 2013, included $0.2 million of severance and reorganization costs related to the sale of the Maine Energy Recovery Company, LP facility and other realignment activities, $0.4 million of expenses related to the divestiture of Maine Energy and the acquisition of Bestway Disposal Services and Blow Brothers Inc, $0.7 million of legal expenses related to the settlement of the New York State income tax matter, and a $0.4 million reversal of a previously estimated loss on the divestiture of Maine Energy.

Excluding these charges, Adjusted Operating Income* in the current quarter was $0.8 million, down $2.3 million from same quarter last year.

The company's net loss attributable to common stockholders was ($11.8) million, or ($0.30) per share for the current quarter, compared to ($13.4) million, or ($0.34) per share for the same quarter last year. In addition to the unusual items identified above, the quarter last year included a $3.7 million loss from discontinued operations related to the disposal of the company's only construction and demolition processing business.

For fiscal year 2014, revenues were $497.6 million, up $42.3 million, or 9.3 percent, from the same period last year. Operating income was $11.9 million for fiscal year 2014, down $0.5 million from the same period last year. Adjusted Operating Income* was $20.8 million for fiscal year 2014, up $2.6 million from the same period last year. The company's net loss attributable to common stockholders was ($23.1) million, or ($0.58) per share for fiscal year 2014, compared to ($54.1) million, or ($1.59) per share for the same period last year. Adjusted EBITDA* was $95.1 million for fiscal year 2014, up $7.3 million from the same period last year.

Company Plans to Change Fiscal Year to Calendar Year End

"We got off to a great start in the first seven months of fiscal year 2014, but experienced challenging operating conditions due to severe winter weather in our third and fourth quarters," Casella said. "An extended winter, and subsequently delayed spring, pushed our seasonal upswing into mid-April, and caused several jobs to move into next fiscal year."

"The challenges we had this winter, and the unpredictability of our seasonal upswing, illuminated the need for us to adjust our fiscal year to better align it with our business cycle," Casella said. "Putting our seasonally weak period at the beginning of our fiscal year gives us flexibility to better manage our business in a number of areas from costs to capital expenditures, and allows us more runway to make adjustments through the fiscal year."

The company said that it is implementing a plan to change its fiscal year end from April 30th to December 31st, effective January 1, 2015. Under this change, the company will report an 8-month transition period ending December 31, 2014, and then subsequently its full fiscal year ending December 31, 2015. During the 8-month transition period, the company will report for the quarters ending July 31, 2014 and October 31, 2014.

Outlook

"Our plan for the 8-month transition period and the 12 months ended December 31, 2015, assumes that economic activity in the northeast remains flat, with limited GDP growth, and no major market changes."

The company provided guidance for its 8-month transition period, which began May 1, 2014 and ends on December 31, 2014, by estimating results in the following ranges:

  • Revenues between $356.0 million and $366.0 million (representing growth of 4.7 percent to 7.6 percent), as compared to $340.1 million for the 8-month period ended December 31, 2013;
     
  • Adjusted EBITDA* between $71.0.0 million and $75.0 million, as compared to $72.1 million for the 8-month period ended December 31, 2013;
     
  • Capital Expenditures of approximately $50.0 million (including roughly $13.0 million of capital associated with new contracts and infrastructure development), payments on operating leases of roughly $5.0 million, and capping, closure and environmental remediation payments of roughly $9.0 million.

The company provided the following assumptions that are built into its 8 month transition period outlook:

  • No material changes in the regional economy from fiscal year 2014.
     
  • In the solid waste business, revenue growth of between 3.0 percent and 5.0 percent, with price growth from 1.0 percent to 2.0 percent; volumes growth from 1.0 percent to 2.0 percent; and the roll-over impact of acquisitions contributing roughly 1.0 percent. We are estimating that landfill volumes increase by approximately 150,000 tons.
     
  • In the recycling business, overall revenue declines of between 2.5 percent and 7.5 percent, driven by lower commodity price and volumes. 
     
  • In the Other segment, revenue growth of between 20.0 percent and 25.0 percent, principally due to growth in the Customer Solutions group.
     
  • No acquisitions beyond the above-mentioned roll-over impact of the acquisitions completed during fiscal year 2014 are included.

In addition, the company provided guidance for its next full fiscal year, which will run from January 1, 2015 through December 31, 2015, by estimating results in the following ranges:

  • Revenues between $520.0 million and $530.0 million;
     
  • Adjusted EBITDA* between $103.0 million and $107.0 million; and
     
  • Free Cash Flow* between $14.0 million and $18.0 million.

*Non-GAAP Financial Measures

In addition to disclosing financial results prepared in accordance with Generally Accepted Accounting Principles in the United States (GAAP), the company also discloses earnings before interest, taxes, depreciation and amortization, adjusted for accretion, depletion of landfill operating lease obligations, gain on sale of assets, development project charge write-offs, legal settlement costs, tax settlement costs, bargain purchase gains, asset impairment charges, environmental remediation charges, severance and reorganization costs, expenses from divestiture, acquisition and financing costs, gains on the settlement of acquisition related contingent consideration, as well as losses on divestiture (Adjusted EBITDA) which is a non-GAAP measure. The company also discloses earnings before interest, taxes, adjusted for gain on sale of assets, development project charge write-offs, legal settlement costs, tax settlement costs, bargain purchase gains, asset impairment charges, environmental remediation charges, severance and reorganization costs, expenses from divestiture, acquisition and financing costs, gains on the settlement of acquisition related contingent consideration, as well as losses on divestiture (Adjusted Operating Income) which is a non-GAAP measure. The company also discloses Free Cash Flow, which is defined as net cash provided by operating activities, less capital expenditures (excluding acquisition related capital expenditures), less payments on landfill operating leases, less assets acquired through financing leases, plus proceeds from the sale of property and equipment, plus contributions from non-controlling interest holders, which is a non-GAAP measure. Adjusted EBITDA and Adjusted Operating Income are reconciled to net income (loss), while Free Cash Flow is reconciled to net cash provided by operating activities.

The company presents Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow because it considers them important supplemental measures of its performance and believes they are frequently used by securities analysts, investors and other interested parties in the evaluation of the company's results. Management uses these non-GAAP measures to further understand the company's "core operating performance." The company believes its "core operating performance" represents its on-going performance in the ordinary course of operations. The company believes that providing Adjusted EBITDA, Adjusted Operating Income and Free Cash Flow to investors, in addition to corresponding income statement and cash flow statement measures, affords investors the benefit of viewing its performance using the same financial metrics that the management team uses in making many key decisions and understanding how the core business and its results of operations may look in the future. The company further believes that providing this information allows its investors greater transparency and a better understanding of its core financial performance. In addition, the instruments governing the company's indebtedness use EBITDA (with additional adjustments) to measure its compliance with covenants such as interest coverage, leverage and debt incurrence.

Non-GAAP financial measures are not in accordance with or an alternative for GAAP. Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow should not be considered in isolation from or as a substitute for financial information presented in accordance with GAAP, and may be different from Adjusted EBITDA, Adjusted Operating Income, or Free Cash Flow presented by other companies.

About Casella Waste Systems, Inc.

Casella Waste Systems, Inc., headquartered in Rutland, Vermont, provides solid waste management services consisting of collection, transfer, disposal, and recycling services in the northeastern United States. For further information, investors contact Ned Coletta, Chief Financial Officer at (802) 772-2239; media contact Joseph Fusco, Vice President at (802) 772-2247; or visit the company's website at http://www.casella.com.

Conference call to discuss quarter

The Company will host a conference call to discuss these results on Thursday, June 26, 2014 at 10:00 a.m. ET. Individuals interested in participating in the call should dial (877) 548-9590 or (720) 545-0037 at least 10 minutes before start time. The call will also be webcast; to listen, participants should visit Casella Waste Systems' website at http://ir.casella.com and follow the appropriate link to the webcast.  A replay of the call will be available on the company's website, or by calling (855) 859-2056 or (404) 537-3406 (Conference ID 60192807) until 11:59 p.m. ET on Thursday, July 3, 2014.

Safe Harbor Statement

Certain matters discussed in this press release are "forward-looking statements" intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such by the context of the statements, including words such as "believe," "expect," "anticipate," "plan," "may," "will," "would," "intend," "estimate," "guidance" and other similar expressions, whether in the negative or affirmative. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry and markets in which we operate and management's beliefs and assumptions. We cannot guarantee that we actually will achieve the plans, intentions, expectations or guidance disclosed in the forward-looking statements made. Such forward-looking statements, and all phases of our operations, involve a number of risks and uncertainties, any one or more of which could cause actual results to differ materially from those described in our forward-looking statements. Such risks and uncertainties include or relate to, among other things: adverse weather conditions that have negatively impacted and may continue to negatively impact our revenues and our operating margin; current economic conditions that have adversely affected and may continue to adversely affect our revenues and our operating margin; we may be unable to increase volumes at our landfills or improve our route profitability; our need to service our indebtedness may limit our ability to invest in our business; we may be unable to reduce costs or increase pricing or volumes sufficiently to achieve estimated Adjusted EBITDA and other targets; landfill operations and permit status may be affected by factors outside our control; we may be required to incur capital expenditures in excess of our estimates; fluctuations in energy pricing or the commodity pricing of our recyclables may make it more difficult for us to predict our results of operations or meet our estimates; and we may incur environmental charges or asset impairments in the future. There are a number of other important risks and uncertainties that could cause our actual results to differ materially from those indicated by such forward-looking statements. These additional risks and uncertainties include, without limitation, those detailed in Item 1A, "Risk Factors" in our Form 10-K for the year ended April 30, 2013.

We undertake no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.

CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except amounts per share)
         
  Three Months Ended Fiscal Year Ended
  April 30, April 30, April 30, April 30,
  2014 2013 2014 2013
  (Unaudited) (Unaudited)    
         
Revenues  $ 118,927  $ 108,694  $ 497,633  $ 455,335
         
Operating expenses:        
Cost of operations  88,028  78,147  354,592  323,014
General and administration  15,000  14,804  61,865  58,205
Depreciation and amortization  15,078  13,332  60,339  56,576
Asset impairment charge  7,455  --   7,455  -- 
Severance and reorganization costs  426  246  586  3,709
Expense from divestiture, acquisition and financing costs  18  408  144  1,410
Environmental remediation charge  --   --   400  -- 
Development project charge  (47)  --   1,394  -- 
Gain on settlement of acquisition related contingent consideration  (1,058)  --   (1,058)  -- 
Reversal of loss on divestiture  --   (353)  --   -- 
   124,900  106,584  485,717  442,914
         
Operating (loss) income  (5,973)  2,110  11,916  12,421
         
Other expense/(income), net:        
Interest expense, net  9,523  9,081  37,863  41,429
(Gain) loss from equity method investments  (62)  1,131  936  4,441
Gain on sale of equity method investment  --   --   (593)  -- 
Loss on derivative instruments  72  640  280  4,512
Loss on debt extinguishment  --   --   --   15,584
Other income  (397)  (298)  (1,059)  (1,036)
Other expense, net  9,136  10,554  37,427  64,930
         
Loss from continuing operations before income taxes and discontinued operations  (15,109)  (8,444)  (25,511)  (52,509)
Provision (benefit) for income taxes  524  1,373  1,799  (2,526)
         
Loss from continuing operations before discontinued operations  (15,633)  (9,817)  (27,310)  (49,983)
         
Discontinued operations:        
(Loss) income from discontinued operations, net of income taxes (1)  --   (3,700)  284  (4,480)
Loss on disposal of discontinued operations, net of income taxes (1)  --   --   (378)  -- 
         
Net loss  (15,633)  (13,517)  (27,404)  (54,463)
         
 Less: Net loss attributable to noncontrolling interests   (3,818)  (120)  (4,309)  (321)
         
Net loss attributable to common stockholders  $ (11,815)  $ (13,397)  $ (23,095)  $ (54,142)
         
Weighted average common shares outstanding 39,916 39,515 39,820 34,015
         
Net loss per common share  $ (0.30)  $ (0.34)  $ (0.58)  $ (1.59)
         
Adjusted EBITDA (2)  $ 19,038  $ 19,355  $ 95,109  $ 87,842
 
 
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
     
  April 30, April 30,
ASSETS 2014 2013
     
CURRENT ASSETS:    
Cash and cash equivalents  $ 2,464  $ 1,755
Restricted cash  76  76
Accounts receivable - trade, net of allowance for doubtful accounts  52,603  48,689
Other current assets  15,662  14,025
Total current assets  70,805  64,545
     
Property, plant and equipment, net of accumulated depreciation and amortization  403,424  422,502
Goodwill  119,139  115,928
Intangible assets, net  13,420  11,674
Restricted assets  681  545
Notes receivable - related party  --  147
Investments in unconsolidated entities  16,752  20,252
Other non-current assets  25,676  27,526
     
Total assets  $ 649,897  $ 663,119
     
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY    
     
CURRENT LIABILITIES:    
Current maturities of long-term debt and capital leases  $ 885  $ 1,218
Accounts payable  51,788  51,974
Other accrued liabilities  37,073  34,906
Total current liabilities  89,746  88,098
     
Long-term debt and capital leases, less current maturities  507,134  494,987
Other long-term liabilities  61,554  64,583
     
Total stockholders' (deficit) equity  (8,537)  15,451
     
Total liabilities and stockholders' (deficit) equity  $ 649,897  $ 663,119
     
     
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
     
  Fiscal Year Ended
  April 30, April 30,
  2014 2013
 Cash Flows from Operating Activities:     
 Net loss   $ (27,404)  $ (54,463)
 (Income) loss from discontinued operations, net   (284)  4,480
 Loss on disposal of discontinued operations, net   378  --
 Adjustments to reconcile net loss to net cash provided by operating activities --     
 Gain on sale of property and equipment   (840)  (407)
 Depreciation and amortization   60,339  56,576
 Depletion of landfill operating lease obligations   9,948  9,372
 Interest accretion on landfill and environmental remediation liabilities   3,985  3,675
 Asset impairment charge   7,455  --
 Development project charge   1,394  --
 Gain on settlement of acquisition related contingent consideration   (1,058)  --
 Amortization of discount on senior subordinated notes and second lien notes   243  626
 Loss from equity method investments  936  4,441
 Gain on sale of equity method investment  (593)  --
 Loss on derivative instruments   280  4,512
 Loss on debt extinguishment   --  15,584
 Stock-based compensation expense and related severance expense   2,404  2,516
 Excess tax benefit on the vesting of share based awards   --  (96)
 Deferred income taxes   1,579  (3,543)
 Changes in assets and liabilities, net of effects of acquisitions and divestitures   (9,120)  633
 Net Cash Provided by Operating Activities   49,642  43,906
 Cash Flows from Investing Activities:     
 Acquisitions, net of cash acquired   (8,305)  (25,225)
 Acquisition related additions to property, plant and equipment   (2,633)  (1,746)
 Additions to property, plant and equipment   (43,326)  (53,281)
 Payments on landfill operating lease contracts   (6,505)  (6,261)
 Payment for capital related to divestiture   --  (618)
 Investments in unconsolidated entities   (2,107)  (3,207)
 Proceeds from sale of equity method investment   3,442  --
 Proceeds from sale of property and equipment   1,524  883
 Net Cash Used In Investing Activities   (57,910)  (89,455)
 Cash Flows from Financing Activities:     
 Proceeds from long-term borrowings   161,650  376,346
 Principal payments on long-term debt   (152,380)  (360,858)
 Payment of tender premium and costs on second lien notes   --  (10,743)
 Payments of financing costs   (405)  (4,609)
 Net proceeds from the sale of Class A common stock   --  42,184
 Proceeds from the exercise of share based awards   143  --
 Excess tax benefit on the vesting of share based awards   --  96
 Contributions from noncontrolling interest holders   --  2,531
 Net Cash Provided By Financing Activities   9,008  44,947
 Net Cash Used In Discontinued Operations   (31)  (2,177)
 Net increase (decrease) in cash and cash equivalents   709  (2,779)
 Cash and cash equivalents, beginning of period   1,755  4,534
 Cash and cash equivalents, end of period   $ 2,464  $ 1,755
     
 Supplemental Disclosures:     
 Cash interest   $ 35,162  $ 41,348
 Cash income taxes, net of refunds   $ 532  $ (253)
 Property, plant and equipment acquired through lease obligations   $ 2,301  $ --
     
     
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands)
                 
Note 1: Discontinued Operations                
                 
In the fourth quarter of fiscal year 2013, we initiated a plan to dispose of KTI BioFuels, Inc. ("BioFuels"), a construction and demolition material processing facility located in Lewiston, Maine, and as a result, the assets associated with BioFuels were classified as held-for-sale and the results of operations were recorded as loss from discontinued operations. Assets of the disposal group previously classified as held-for-sale, and included in discontinued operations as of April 30, 2013, include certain inventory along with plant and equipment. In the first quarter of fiscal year 2014, we executed a purchase and sale agreement with ReEnergy Lewiston LLC ("ReEnergy"), pursuant to which we agreed to sell certain assets of BioFuels, which was located in our Eastern region, to ReEnergy. We agreed to sell the BioFuels assets for undiscounted purchase consideration of $2,000, which is being paid to us in equal quarterly installments over five years commencing November 1, 2013, subject to the terms of the purchase and sale agreement. We recognized a $378 loss on disposal of discontinued operations in the first quarter of fiscal year 2014 associated with the disposition.
The operating results of these operations, including those related to prior years, have been reclassified from continuing to discontinued operations in the accompanying consolidated financial statements. Revenues and loss before income taxes attributable to discontinued operations for fiscal year 2014, 2013 and 2012, respectively, are as follows: 
 
  Fiscal Year Ended April 30,
  2014 2013 2012
Revenues  $ 3,316  $ 12,033  $ 12,865
Income (loss) before income taxes  $ 284  $ (4,480)  $ (1,025)
                 
Note 2: Non - GAAP Financial Measures                
                 
In addition to disclosing financial results prepared in accordance with Generally Accepted Accounting Principles in the United States (GAAP), we also disclose earnings before interest, taxes, depreciation and amortization, adjusted for accretion, depletion of landfill operating lease obligations, gain on sale of assets, development project charge write-offs, legal settlement costs, tax settlement costs, bargain purchase gains, asset impairment charges, environmental remediation charges, severance and reorganization costs, expenses from divestiture, acquisition and financing costs, gains on settlement of acquisition related contingent consideration, as well as losses on divestiture (Adjusted EBITDA), which is a non-GAAP measure. We also disclose earnings before interest, taxes, adjusted for gain on sale of assets, development project charge write-offs, legal settlement charges, tax settlement costs, bargain purchase gains, asset impairment charges, environmental remediation charges, severance and reorganization costs, expenses from divestiture, acquisition and financing costs, gains on settlement of acquisition related contingent consideration, as well as losses on divestiture (Adjusted Operating Income), which is a non-GAAP measure. We also disclose Free Cash Flow, which is defined as net cash provided by operating activities, less capital expenditures (excluding acquisition related capital expenditures), less payments on landfill operating leases, less assets acquired through financing leases, plus proceeds from the sale of property and equipment, plus contributions from noncontrolling interest holders, which is a non-GAAP measure. Adjusted EBITDA and Adjusted Operating Income are reconciled to net income (loss), while Free Cash Flow is reconciled to net cash provided by operating activities.
We present Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow because we consider them important supplemental measures of our performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of our results. We use these non-GAAP measures to further understand our "core operating performance." We believe our "core operating performance" represents our on-going performance in the ordinary course of operations. We believe that providing Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow to investors, in addition to corresponding income statement and cash flow statement measures, affords investors the benefit of viewing our performance using the same financial metrics that our management team uses in making many key decisions and understanding how the core business and our results of operations may look in the future. We further believe that providing this information allows our investors greater transparency and a better understanding of our core financial performance. In addition, the instruments governing our indebtedness use EBITDA (with additional adjustments) to measure our compliance with covenants such as interest coverage, leverage and debt incurrence.
Non-GAAP financial measures are not in accordance with or an alternative for GAAP. Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow should not be considered in isolation from or as a substitute for financial information presented in accordance with GAAP, and may be different from Adjusted EBITDA, Adjusted Operating Income, or Free Cash Flow presented by other companies.
 
Following is a reconciliation of Adjusted EBITDA and Adjusted Operating Income to Net Loss:
         
  Three Months Ended Fiscal Year Ended
  April 30, April 30, April 30, April 30,
  2014 2013 2014 2013
         
Net Loss   $ (15,633)  $ (13,517)  $ (27,404)  $ (54,463)
 Loss (income) from discontinued operations, net   --  3,700  (284)  4,480
 Loss on disposal of discontinued operations, net   --  --  378  --
 Provision (benefit) for income taxes   524  1,373  1,799  (2,526)
 Other (income) expense, net   (387)  1,473  (436)  23,501
 Interest expense, net   9,523  9,081  37,863  41,429
 Expense from divestiture, acquisition and financing costs   18  408  144  1,410
 Depreciation and amortization   15,078  13,332  60,339  56,576
 Severance and reorganization costs   426  246  586  3,709
 Tax settlement costs   --  679  --  679
 Environmental remediation charge   --  --  400  --
 Reversal of loss on divestiture   --  (353)  --  --
 Asset impairment charge   7,455  --  7,455  --
 Gain on settlement of acquisition related contingent consideration   (1,058)  --  (1,058)  --
 Development project charge   (47)  --  1,394  --
 Depletion of landfill operating lease obligations   2,238  2,014  9,948  9,372
 Interest accretion on landfill and environmental remediation liabilities   901  919  3,985  3,675
Adjusted EBITDA (2)  $ 19,038  $ 19,355  $ 95,109  $ 87,842
 Depreciation and amortization   (15,078)  (13,332)  (60,339)  (56,576)
 Depletion of landfill operating lease obligations   (2,238)  (2,014)  (9,948)  (9,372)
 Interest accretion on landfill and environmental remediation liabilities   (901)  (919)  (3,985)  (3,675)
Adjusted Operating Income (2)  $ 821  $ 3,090  $ 20,837  $ 18,219
         
Following is a reconciliation of Free Cash Flow to Net Cash Provided by Operating Activities:
 
  Three Months Ended Fiscal Year Ended
  April 30, April 30, April 30, April 30,
  2014 2013 2014 2013
Net Cash Provided by Operating Activities  $ 11,964  $ 12,735  $ 49,642  $ 43,906
Capital expenditures  (9,095)  (10,493)  (43,326)  (53,281)
Payments on landfill operating lease contracts  (453)  (535)  (6,505)  (6,261)
Proceeds from sale of property and equipment  276  102  1,524  883
Contributions from noncontrolling interest holders  --   1,336  --   2,531
Free Cash Flow (2)  $ 2,692  $ 3,145  $ 1,335  $ (12,222)
         
         
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
SUPPLEMENTAL DATA TABLES
(Unaudited)
(In thousands)
         
Amounts of our total revenues attributable to services provided for the three and twelve months ended April 30, 2014 and 2013 are as follows:
         
  Three Months Ended April 30,
    % of Total   % of Total
  2014 Revenue 2013 Revenue
Collection   $ 53,921 45.3%  $ 51,848 47.7%
Disposal  27,374 23.0%  24,481 22.5%
Power generation  2,699 2.3%  2,498 2.3%
Processing  1,683 1.4%  1,751 1.6%
Solid waste operations  85,677 72.0%  80,578 74.1%
Organics  9,701 8.2%  9,358 8.6%
Customer solutions  12,574 10.6%  8,159 7.5%
Recycling  10,975 9.2%  10,599 9.8%
Total revenues  $ 118,927 100.0%  $ 108,694 100.0%
         
  Fiscal Year Ended April 30,
    % of Total   % of Total
  2014 Revenue 2013 Revenue
Collection   $ 225,441 45.3%  $ 208,973 45.9%
Disposal  128,778 25.9%  115,049 25.3%
Power generation  9,512 1.9%  11,354 2.4%
Processing  8,852 1.8%  6,901 1.5%
Solid waste operations  372,583 74.9%  342,277 75.1%
Organics  37,829 7.6%  35,330 7.8%
Customer solutions  43,396 8.7%  35,455 7.8%
Recycling  43,825 8.8%  42,273 9.3%
Total revenues  $ 497,633 100.0%  $ 455,335 100.0%
         
Components of revenue growth for the three months ended April 30, 2014 compared to the three months ended April 30, 2013 are as follows:
    % of Related % of Solid Waste % of Total
  Amount Business Operations Company
Solid Waste Operations:        
Collection  $ 787 1.5% 1.0% 0.7%
Disposal  (358) -1.5% -0.5% -0.3%
Solid Waste Yield  429   0.5% 0.4%
         
Collection  758   0.9% 0.7%
Disposal  2,226   2.8% 2.1%
Processing   139   0.2% 0.1%
Solid Waste Volume  3,123   3.9% 2.9%
         
Fuel surcharge  (19)   0.0% 0.0%
Commodity price & volume  13   0.0% 0.0%
Acquisitions, net divestitures  1,554   1.9% 1.4%
Total Solid Waste  5,099   6.3% 4.7%
         
Organics  343     0.3%
         
Customer Solutions  4,415     4.1%
         
      % of Recycling  
Recycling Operations:     Operations  
Commodity price  34   0.3% 0.0%
Commodity volume  33   0.4% 0.0%
Commodity acquisition  309   2.9% 0.3%
Total Recycling  376   3.6% 0.3%
         
Total Company  $ 10,233     9.4%
         
Solid Waste Internalization Rates by Region:        
         
  Three Months Ended April 30, Fiscal Year Ended April 30,
  2014 2013 2014 2013
Eastern region 51.6% 55.8% 52.1% 54.3%
Western region 76.2% 72.5% 75.2% 73.3%
Solid waste internalization 63.6% 64.2% 63.6% 64.5%
         
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
SUPPLEMENTAL DATA TABLES
(Unaudited)
(In thousands)
         
Components of Capital Expenditures (1):
         
  Three Months Ended April 30, Fiscal Year Ended April 30,
  2014 2013 2014 2013
         
Landfill development  $ 4,171  $ 5,696  $ 21,252  $ 27,310
Vehicles, machinery, equipment and containers  4,057  2,513  17,353  13,938
Facilities  628  2,260  3,694  11,609
Other  239  24  1,027  424
Total Capital Expenditures  9,095  10,493  43,326  53,281
         
(1) Does not include acquisition related capital expenditures, which are defined as costs of equipment added directly as a result of new business growth related to an acquisition. 
         
Investors:
Ned Coletta
Chief Financial Officer
(802) 772-2239

Media:
Joseph Fusco
Vice President
(802) 772-2247

http://www.casella.com