Waste Connections (WCN) Q3 2022 Earnings Call Transcript

For the period ending September 30, 2022

November 3, 2022 8:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning, and welcome to the Waste Connections Q3 2022 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Worthing Jackman, President and CEO. Please go ahead.

Worthing Jackman

Thank you, operator, and good morning. And congrats to the [indiscernible] last night. Yes, Jason Craft, you can pay me now. I'd like to welcome everyone to this conference call to discuss our third quarter results, and to provide a detailed outlook for the fourth quarter and updated outlook for 2022, as well as some early thoughts about 2023. I'm joined this morning by Mary Anne Whitney, our CFO.

As noted in our earnings release, strong execution once again provided for better than expected results driven in the third quarter by continued acceleration of solid waste pricing and higher E&P waste activity, along with acquisitions closed during the period. Most notably, we overcame 50 basis points in incremental headwinds primarily from the precipitous decline in recycle commodity values in September, to beat our outlook and expand adjusted EBITDA margin both sequentially and on a year-over-year basis, excluding the dilutive impact from acquisitions completed since year ago period.

Our outperformance through the third quarter and acquisitions close year-to-date enhance our visibility for expected double-digit revenue and adjusted free cash flow growth in 2023, led by pricing expected to remain at elevated levels, plus contributions from acquisitions already signed or closed year-to-date. In addition, we expect underlying margin expansion to overcome headwinds from recent decreases in recycled commodity values.

Before we get into much more detail, let me turn the call over to Mary Anne for our forward-looking disclaimer and other housekeeping items.

Mary Anne Whitney

Thank you, Worthing, and good morning. The discussion during today's call includes forward-looking statements made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 including forward-looking information within the meaning of applicable Canadian securities laws.

Actual results could differ materially from those made in such forward-looking statements due to various risks and uncertainties. Factors that could cause actual results to differ discussed both in the cautionary statement included in our November 2 earnings release and in greater detail in Waste Connections filings with the U.S. Securities and Exchange Commission and the Securities Commissions or similar regulatory authorities in Canada.