Segment Reporting

9 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

Segment Reporting

7.SEGMENT REPORTING

The Company’s revenues are generated from the collection, transfer, recycling and disposal of non-hazardous solid waste and the treatment, recovery and disposal of non-hazardous E&P waste.  No single contract or customer accounted for more than 10% of the Company’s total revenues at the consolidated or reportable segment level during the periods presented.

The Company manages its operations through three geographic operating segments (Western, Central and Eastern) and its E&P segment, which includes the majority of the Company’s E&P waste treatment and disposal operations.  The Company’s three geographic operating segments and its E&P segment comprise the Company’s reportable segments.  Each operating segment is responsible for managing several vertically integrated operations, which are comprised of districts.  The Company’s Western segment is comprised of operating locations in Alaska, California, Idaho, Montana, Nevada, Oregon, Washington and western Wyoming; the Company’s Central segment is comprised of operating locations in Arizona, Colorado, Kansas, Louisiana, Minnesota, Nebraska, New Mexico, Oklahoma, South Dakota, Texas, Utah and eastern Wyoming; and the Company’s Eastern segment is comprised of operating locations in Alabama, Illinois, Iowa, Kentucky, Massachusetts, Michigan, Mississippi, New York, North Carolina, South Carolina and Tennessee.  The E&P segment is comprised of the Company’s E&P operations in Louisiana, New Mexico, North Dakota, Oklahoma, Texas, Wyoming and along the Gulf of Mexico.

The Company’s Chief Operating Decision Maker (“CODM”) evaluates operating segment profitability and determines resource allocations based on several factors, of which the primary financial measure is EBITDA. The Company defines EBITDA as earnings before interest, taxes, depreciation, amortization, gain (loss) on disposal of assets andimpairments and other income (expense).  EBITDA is not a measure of operating income, operating performance or liquidity under GAAP and may not be comparable to similarly titled measures reported by other companies.  The Company’s management uses EBITDA in the evaluation of segment operating performance as it is a profit measure that is generally within the control of the operating segments.  A reconciliation of EBITDA to Income before income tax provision is included at the end of this Note 7.

Summarized financial information concerning the Company’s reportable segments for the three and nine months ended September 30, 2014 and 2013, is shown in the following tables: 

Three Months Ended September 30, 2014	Gross Revenues		Intercompany Revenues(b)		Net Revenues		EBITDA(c)
Western	$	240,744	$	(24,895)	$	215,849	$	69,140
Central		167,945		(18,732)		149,213		53,809
Eastern		123,634		(21,010)		102,624		29,379
E&P		82,385		(3,520)		78,865		39,535
Corporate(a)		-		-		-		(1,152)
	$	614,708	$	(68,157)	$	546,551	$	190,711

Three Months Ended September 30, 2013	Gross Revenues		Intercompany Revenues(b)		Net Revenues		EBITDA(c)
Western	$	236,849	$	(26,638)	$	210,211	$	67,773
Central		151,181		(16,848)		134,333		48,845
Eastern		115,944		(19,884)		96,060		28,038
E&P		65,376		(2,334)		63,042		31,125
Corporate(a)		-		-		-		188
	$	569,350	$	(65,704)	$	503,646	$	175,969

Nine Months Ended September 30, 2014	Gross Revenues		Intercompany Revenues(b)		Net Revenues		EBITDA(c)
Western	$	689,251	$	(71,778)	$	617,473	$	194,894
Central		471,247		(51,052)		420,195		148,471
Eastern		353,551		(59,543)		294,008		87,284
E&P		232,447		(11,170)		221,277		111,730
Corporate(a)		-		-		-		(7,449)
	$	1,746,496	$	(193,543)	$	1,552,953	$	534,930

Nine Months Ended September 30, 2013	Gross Revenues		Intercompany Revenues(b)		Net Revenues		EBITDA(c)
Western	$	682,705	$	(76,510)	$	606,195	$	188,736
Central		426,353		(46,993)		379,360		137,600
Eastern		336,916		(57,362)		279,554		82,947
E&P		186,255		(8,446)		177,809		82,036
Corporate(a)		-		-		-		(2,679)
	$	1,632,229	$	(189,311)	$	1,442,918	$	488,640

____________________

(a)Corporate functions include accounting, legal, tax, treasury, information technology, risk management, human resources, training and other administrative functions.  Amounts reflected are net of allocations to the four operating segments.

(b)Intercompany revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments.  Transactions within and between segments are generally made on a basis intended to reflect the market value of the service. 

(c)For those items included in the determination of EBITDA, the accounting policies of the segments are the same as those described in the Company’s most recent Annual Report on Form 10-K.

The following tables show changes in goodwill during the nine months ended September 30, 2014 and 2013, by reportable segment: 

	Western		Central		Eastern		E&P		Total
Balance as of December 31, 2013	$	372,915	$	459,054	$	380,570	$	462,615	$	1,675,154
Goodwill acquired		-		2,050		11,698		-		13,748
Goodwill divested		-		(143)		-		-		(143)
Goodwill adjustments		-		(843)		(1)		-		(844)
Balance as of September 30, 2014	$	372,915	$	460,118	$	392,267	$	462,615	$	1,687,915

	Western		Central		Eastern		E&P		Total
Balance as of December 31, 2012	$	373,143	$	430,412	$	380,561	$	452,441	$	1,636,557
Goodwill transferred		-		(9,196)		-		9,196		-
Goodwill acquired		521		70		567		575		1,733
Goodwill divested		(749)		-		-		-		(749)
Balance as of September 30, 2013	$	372,915	$	421,286	$	381,128	$	462,212	$	1,637,541

The Company has no accumulated impairment losses associated with goodwill. 

A reconciliation of the Company’s primary measure of segment profitability (EBITDA) to Income before income tax provision in the Condensed Consolidated Statements of Net Income is as follows: 

	Three months ended September 30,				Nine months ended September 30,
	2014		2013		2014		2013
Western segment EBITDA	$	69,140	$	67,773	$	194,894	$	188,736
Central segment EBITDA		53,809		48,845		148,471		137,600
Eastern segment EBITDA		29,379		28,038		87,284		82,947
E&P segment EBITDA		39,535		31,125		111,730		82,036
Subtotal reportable segments		191,863		175,781		542,379		491,319
Unallocated corporate overhead		(1,152)		188		(7,449)		(2,679)
Depreciation		(58,998)		(55,863)		(171,920)		(162,277)
Amortization of intangibles		(6,702)		(6,211)		(20,158)		(18,861)
Gain (loss) on disposal of assets and impairments		(9,000)		1,725		(7,535)		(11,895)
Interest expense		(15,815)		(17,911)		(48,666)		(55,851)
Other income (expense), net		(389)		845		(252)		(119)
Income before income tax provision	$	99,807	$	98,554	$	286,399	$	239,637

The following table shows, for the periods indicated, the Company’s total reported revenues by service line and with intercompany eliminations: 

	Three months ended September 30,				Nine months ended September 30,
	2014		2013		2014		2013
Solid waste collection	$	333,917	$	312,872	$	962,683	$	912,488
Solid waste disposal and transfer		167,129		158,142		461,605		434,513
E&P waste treatment, recovery and disposal		86,085		68,605		242,049		194,720
Solid waste recycling		14,973		18,402		44,713		55,806
Intermodal and other		12,604		11,329		35,446		34,702
		614,708		569,350		1,746,496		1,632,229
Less: intercompany elimination		(68,157)		(65,704)		(193,543)		(189,311)
Total revenues	$	546,551	$	503,646	$	1,552,953	$	1,442,918