GFL Environmental Inc. (GFL) Q2 2022 Earnings Call Transcript

For the period ending June 30, 2022

July 28, 2022 8:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning. My name is Victoria and I will be your conference operator this morning. As a reminder, this conference call is being recorded. I would like to welcome everyone to GFL Environmental, Inc.’s Results Call for the Second Quarter of 2022. I will now turn the call over to Patrick Dovigi, the CEO of GFL. Please go ahead, Mr. Dovigi.

Patrick Dovigi

Thank you and good morning. I would like to welcome everyone to today’s call and thank you for joining us. This morning, we will be reviewing our results for the second quarter and updating our guidance for this year. I am joined this morning by Luke Pelosi, CFO who will take us through the forward-looking disclaimer before we get into the details.

Luke Pelosi

Thank you, Patrick. Good morning, everyone. We have filed our earnings press release, which includes important information. This press release is available on our website.

During this call, we will be making some forward-looking statements within the meaning of applicable Canadian and U.S. securities laws, including statements regarding events or developments that we believe or anticipate may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set out in our filings with the Canadian and U.S. securities regulators. Any forward-looking statement is not a guarantee of future performance and actual results may differ materially from those expressed or implied in the forward-looking statements. These forward-looking statements speak only as of today’s date and we do not assume any obligation to update these statements, whether as a result of new information, future events and developments or otherwise. This call will include a discussion of certain non-IFRS measures. A reconciliation of these non-IFRS measures can be found in our filings with the Canadian and U.S. securities regulators.

I will now turn the call back over to Patrick.

Patrick Dovigi

Thank you, Luke. Our strong start to the year accelerated into the second quarter, once again driving industry-leading results. The strength of our business model, the quality of our market selection and the capability of our team were all demonstrated again this quarter, even in the face of many unprecedented headwinds.

Organic revenue growth for the quarter was over 13%. That’s the second quarter in a row with double-digit growth in both our Solid Waste and Environmental Services segments. The 6.4% solid waste price in the first quarter accelerated to 7.3% in the second quarter as we continue to flex our pricing strategies in response to the record-breaking cost inflation environment. We also recognized 1.9% solid waste revenue growth from our surcharges as our efforts in this area have begun to drive meaningful contribution. We’ve said before that we see a lot of opportunity to increase the dollars we recover from surcharges, and we’re confident in our ability to continue to optimize the book of business using this lever. With a substantial price outperformance in the first half of the year, we expect to significantly exceed the high end of our revenue guidance for the year, and Luke will speak to our revised guidance.