On November 1, 2023, Casella Waste Systems Inc (CWST, Financial) announced its financial results for the third quarter of 2023. The company reported solid financial results driven by its growth strategy, operating programs, and investments in Resource Solutions. Despite a decrease in net income, the company raised its revenue, Adjusted EBITDA, and Adjusted Free Cash Flow guidance ranges for the fiscal year ending December 31, 2023.
Financial Highlights
Revenues for the quarter were $352.7 million, up $57.5 million, or 19.5%, from the same period in 2022. The increase in revenue was primarily driven by higher collection pricing and disposal pricing, which were up 7.6% and 5.9% respectively. However, net income was $18.2 million for the quarter, down $(4.5) million, or down (19.8)%, from the same period in 2022. The decrease in net income was negatively impacted by a $2.4 million increase in expense from acquisition activities.
Adjusted EBITDA, a non-GAAP measure, was $89.6 million for the quarter, up $14.6 million, or up 19.4%, from the same period in 2022. Net cash provided by operating activities was $157.8 million for the year-to-date period, up $5.4 million, or up 3.5%, from the same period in 2022. Adjusted Free Cash Flow, another non-GAAP measure, was $96.0 million for the year-to-date period, up $14.3 million, or up 17.5%, from the same period in 2022.
Acquisitions and Growth Strategy
The company closed three acquisitions during the quarter, including the acquisition of Consolidated Waste Services, LLC and its affiliates (dba “Twin Bridges”) on September 1, 2023. John W. Casella, Chairman and CEO of Casella Waste Systems, Inc., noted that the team is doing an excellent job balancing the on-boarding and integration of recent acquisitions while delivering excellent operating results in the core business.
Fiscal Year 2023 Outlook
Given the expected contribution from acquisitions closed year-to-date and continued pricing above cost inflation, the company updated certain fiscal year 2023 guidance ranges. The company raised guidance for fiscal year 2023 by estimating revenues between $1.255 billion and $1.280 billion, Adjusted EBITDA between $292 million and $298 million, and Adjusted Free Cash Flow between $125 million and $131 million. However, the company updated its net income guidance to between $33 million and $39 million, down from a range between $41 million to $47 million.
Explore the complete 8-K earnings release (here) from Casella Waste Systems Inc for further details.
