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UNITED STATES ____________ Form 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Date of Report (Date of earliest event reported): September 30, 2004 Waste Services, Inc. Delaware 000-25955 01-0780204 (State or other
jurisdiction of (Commission (I.R.S. Employer incorporation or
organization) File Number) Identification No.) 1122 International Blvd.,
Suite 601, Burlington, Ontario, Canada L7L 6Z8 (Address of principal
executive offices and zip code) (905) 319-1237 (Registrant's telephone number,
including area code) Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligations of the registrant under any of the following
provisions: o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) o Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition Waste Services, Inc. ("Waste Services", "we",
"us" or "our") issued a press release on November 10, 2004 announcing
our results of operations for the quarter ended September 30, 2004. A copy of that release
is furnished as Exhibit 99.1. Section 9 Financial Statements and Exhibits Item 9.01 - Financial Statements and Exhibits (c) Exhibits 99.1 Press Release issued
November 10, 2004. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized. WASTE SERVICES, INC By: /s/ Ivan R. Cairns Ivan R. Cairns Executive Vice President, General Counsel & Secretary Date: November 10, 2004 EXHIBIT 99.1 PRESS RELEASE WASTE SERVICES REPORTS THIRD QUARTER RESULTS BURLINGTON, Ontario, November 10, 2004 /PRNewswire-FirstCall/
Waste Services, Inc. (Nasdaq: WSII) today reported financial results for the three months
ended September 30, 2004. Revenue for the quarter was $94.6 million, an increase of $59.9
million, or 172% over the same period last year. The increase is primarily attributable to
new business acquisitions in the United States, since the company initiated a
disposal-based growth strategy to enter the U.S. solid waste market in 2003. Additionally,
the company began operations at its Southeast Regional Landfill and transfer stations
serving the Phoenix market and the Fort Bend Regional Landfill serving the Houston market.
Operating income before depreciation, depletion and amortization* was $15.4 million for
the three months ended September 30, 2004, compared to $3.0 million for the same period
last year. The results for the current quarter include certain specific gains and losses
that are further described in this release. Net loss attributable to Common Shareholders
for the three months ended September 30, 2004 was $5.7 million, or $0.06 per share, versus
a loss of $40.7 million, or $1.06 per share, for the comparable period last year. For the nine months ended September 30, 2004, revenue was $217.6
million, an increase of $126.3 million or 138% over the comparable period last year. Net
loss attributable to Common Shareholders was $35.1 million for the nine months ended
September 30, 2004, or $0.41 per share, compared to a net loss attributable to Common
Shareholders of $65.0 million, or $1.75 per share for the comparable period last year. As previously announced, the company reached an agreement with the
selling shareholders of Florida Recycling Services, Inc. ("FRS") to adjust the
purchase price paid for the shares of FRS. Pursuant to that agreement, the company
recorded a gain in the quarter of $8.6 million. Additionally, on October 4, 2004, the
company amended its senior secured credit facilities. The company also incurred
approximately $1.2 million of professional fees and other costs primarily related to the
bank amendment as well as the previously announced migration transaction. As part of the
companys cost reduction programs, it incurred severance and related costs for the
quarter of $2.7 million. Stock-based compensation for the quarter was $0.4 million as
compared to $1.5 million for the same period in the prior year. The Chairman and Chief Executive Officer of the company, David
Sutherland-Yoest, stated "We are pleased with our third quarter results and
sequential improvements over the second quarter. We look forward to continued improvement
as we execute the growth and action plans in each of our geographic markets." * Reconciliation of Non-GAAP Measures for the Three and Nine Months
Ended September 30, 2004 and 2003: The following table reconciles the differences between income (loss)
from operations, as determined under U.S. GAAP, and operating income before depreciation,
depletion and amortization, a non-GAAP financial measure (in thousands of U.S. dollars)
(unaudited): For the Three
Months Ended For the Nine
Months Ended September 30, September 30, 2004 2003 2004 2003 $15,372 $2,967 $29,729 $10,804 9,712 3,808 22,993 10,599 $ 5,660 $ (841) $ 6,736 $ 205 (1) Operating income before depreciation, depletion and
amortization is presented because the company believes that it may be used by certain
investors to analyze and compare the companys operating performance between
accounting periods and against the operating results of other companies that have
different financing and capital structures or tax rates. In addition, management uses
operating income before depreciation, depletion and amortization, among other things, as
an internal performance measure. The companys lenders also use operating income
before depreciation, depletion and amortization to measure the companys ability to
service and/or incur additional indebtedness under its credit facilities. However,
operating income before depreciation, depletion and amortization should not be considered
in isolation or as a substitute for net income, cash flows or other financial statement
data prepared in accordance with U.S. GAAP or as a measure of a companys
performance, profitability or liquidity. Operating income before depreciation, depletion
and amortization is not calculated under U.S. GAAP and therefore is not necessarily
comparable to similarly titled measures of other companies
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________
Securities Exchange Act of 1934
(Exact name of registrant as specified in its charter)
Section 2 Financial Information
For Immediate Release
Operating income before
depreciation, depletion and amortization (1)
Less: Depreciation, depletion and amortization
Income (loss) from
operations
The company will host an investor and analyst conference call on Wednesday, November 10, 2004 at 5:00 p.m. (EST) to discuss the results of todays earnings announcement. If you wish to participate in this call, please contact the conference call operator at (877) 211-7911 or (416) 405-9310. For those unable to listen to the live call, a telephonic replay of the call will be available until November 24. 2004 by phoning (800) 408-3053 or (416) 695-5800 and entering reservation number 3112516.
# # #
Safe Harbor for Forward-Looking Statements
Certain matters discussed in this press release are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements describe the company's future plans, objectives and goals. These forward- looking statements involve risks and uncertainties which could cause actual results to differ materially from the plans, objectives and goals set forth in this press release. Factors which could materially affect such forward- looking statements can be found in the companys periodic reports filed with the Securities and Exchange Commission, including risk factors detailed in the companys Form 10-K for the year ended December 31, 2003. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements.
The forward-looking statements made in this press release are only made as of the date hereof and Waste Services undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
Waste Services, Inc. is a multi-regional integrated solid waste services company that
provides collection, transfer, disposal and recycling services in the United States and
Canada. The company's web site is www.wasteservicesinc.com. Information on the
company's web site does not form part of this press release.
For information contact:
Mark A. Pytosh
Executive Vice President
905-319-6054
WASTE SERVICES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of US dollars; except per share data)
Three Months Ended September 30, |
Nine Months Ended September 30, |
||||||||||||||
2004 |
2003 |
2004 |
2003 |
||||||||||||
Revenue | $ 94,615 |
$ 34,748 |
$ 217,558 |
$ 91,310 |
|||||||||||
Operating and other expenses: | |||||||||||||||
Cost of operations | 68,427 |
22,915 |
153,043 |
59,939 |
|||||||||||
Selling, general and administrative expense | |||||||||||||||
exclusive of stock-based compensation | 16,335 |
7,321 |
41,712 |
18,842 |
|||||||||||
Stock-based compensation expense (benefit) | 386 |
1,462 |
(648) |
1,285 |
|||||||||||
Severance and other related costs | 2,709 |
- |
2,709 |
- |
|||||||||||
Settlement with sellers of Florida Recycling | (8,635) |
- |
(8,635) |
- |
|||||||||||
Depreciation, depletion and amortization | 9,712 |
3,808 |
22,993 |
10,599 |
|||||||||||
Foreign exchange loss (gain) and other | 21 |
83 |
(352) |
440 |
|||||||||||
Income (loss) from operations | 5,660 |
(841) |
6,736 |
205 |
|||||||||||
Interest expense | 5,681 |
1,514 |
24,263 |
4,501 |
|||||||||||
Changes in fair value of warrants | (532) |
- |
(111) |
- |
|||||||||||
Cumulative mandatorily redeemable preferred stock dividends and | |||||||||||||||
amortization of issue costs | 4,535 |
3,858 |
12,844 |
6,056 |
|||||||||||
Loss before income taxes | (4,024) |
(6,213) |
(30,260) |
(10,352) |
|||||||||||
Income tax provision | 1,695 |
908 |
5,033 |
574 |
|||||||||||
Loss before cumulative effect of change in accounting principle | (5,719) |
(7,121) |
(35,293) |
(10,926) |
|||||||||||
Cumulative effect of change in accounting principle, net of provision | |||||||||||||||
for income taxes of $132 and $256 for the nine months ended | |||||||||||||||
September 30, 2004 and 2003, respectively | - |
- |
225 |
518 |
|||||||||||
Net loss | (5,719) |
(7,121) |
(35,068) |
(10,408) |
|||||||||||
Deemed dividend on Series 1 Preferred Shares | - |
(33,551) |
- |
(54,572) |
|||||||||||
Net loss attributable to Common Shareholders | $ (5,719) |
$ (40,672) |
$ (35,068) |
$ (64,980) |
|||||||||||
Basic and diluted loss per share: | |||||||||||||||
Basic and diluted loss per share attributable to common shareholders | |||||||||||||||
before cumulative effect of change in accounting principle.. | $ (0.06) |
$ (1.06) |
$ (0.41) |
$ (1.76) |
|||||||||||
Cumulative effect of change in accounting principle | - |
- |
- |
0.01 |
|||||||||||
Loss per share - basic and diluted | $ (0.06) |
$ (1.06) |
$ (0.41) |
$ (1.75) |
|||||||||||
Weighted average Common Shares outstanding - basic and diluted | 96,854 |
38,447 |
85,484 |
37,181 |
|||||||||||