ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 90-0875845 | |
(State or other jurisdiction of incorporation) | (IRS Employer Identification No.) |
Large accelerated filer | ¨ | Accelerated filer | ¨ | |||
Non-accelerated filer | ý (Do not check if a smaller reporting company) | Smaller reporting company | ¨ |
• | our history of losses; |
• | operating in a highly competitive industry and the inability to compete effectively with larger and better capitalized companies and governmental service providers; |
• | results being vulnerable to a downturn in economic conditions; |
• | we may lose contracts through competitive bidding, early termination or governmental action; |
• | some of our customers, including governmental entities, have suffered financial difficulties affecting their credit risk, which could negatively impact our operating results; |
• | our financial and operating performance may be affected by the inability in some instances to renew landfill operating permits, obtain new landfills or expand existing ones; |
• | the cost of operation and/or future construction of our existing landfills may become economically unfeasible causing us to abandon or cease operations; |
• | we could be precluded from maintaining permits or entering into certain contracts if we are unable to obtain sufficient third-party financial assurance or adequate insurance coverage; |
• | our accruals for our landfill site closure and post-closure costs may be inadequate; |
• | our cash flow may not be sufficient to finance our high capital expenditure requirements; |
• | our acquisitions, including our ability to integrate acquired businesses, or that the acquired businesses will have unexpected risks or liabilities; |
• | the seasonal nature of our business and event-driven waste projects that could cause our results to fluctuate; |
• | we may be subject to judicial, administrative or other third-party proceedings that could interrupt or limit our operations, result in adverse judgments, settlements or fines and create negative publicity; |
• | fuel supply and prices may fluctuate significantly and we may not be able to pass on cost increases to our customers or effectively hedge such costs; |
• | fluctuations in the prices of commodities; |
• | increases in labor and disposal costs and transportation costs could adversely impact our financial results; |
• | derivatives could adversely affect our results; |
• | efforts by labor unions to organize our workforce could adversely affect operating results; |
• | we depend significantly on the services of the members of our senior, regional and local management teams, and the departure of any of those persons could cause our operating results to suffer; |
• | we are increasingly dependent on technology in our operations and, if our technology fails, our business could be adversely affected; |
• | a cybersecurity incident could negatively impact our business and our relationships with customers; |
• | operational and safety risks, including the risk of personal injury to employees and others; |
• | we are subject to substantial governmental regulation and failure to comply with these requirements, as well as enforcement actions and litigation arising from an actual or perceived breach of such requirements, could subject us to fines, penalties and judgments, and impose limits on our ability to operate and expand; |
• | our operations being subject to environmental, health and safety laws and regulations, as well as contractual obligations that may result in significant liabilities; |
• | future changes in laws or renewed enforcement of laws regulating the flow of solid waste in interstate commerce could adversely affect our operating results; |
• | fundamental change in the waste management industry as traditional waste streams are increasingly viewed as renewable resources and changes in laws and environmental policies may limit the items that enter the waste stream, any of which may adversely impact volumes and tipping fees at our landfills; |
• | alternatives to landfill disposal may cause our revenues and operating results to decline; |
• | our substantial indebtedness and our working capital deficit; |
• | our ability to implement growth strategy as and when planned; and |
• | the other risks described in the Risk Factors section of our Prospectus filed with the Securities and Exchange Commission on October 7, 2016 pursuant to Rule 424(b). |
Item 1. | ||
Item 2. | ||
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Item 4. | ||
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Item 1a. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 5. | ||
Item 6. | ||
(in millions, except share data) | September 30, 2016 | December 31, 2015 | |||||
Assets | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 0.5 | $ | 0.6 | |||
Accounts receivable, net of allowance for doubtful accounts of $4.2 and $4.4, respectively | 179.6 | 177.5 | |||||
Prepaid expenses and other current assets | 25.7 | 33.4 | |||||
Total current assets | 205.8 | 211.5 | |||||
Other assets | 22.8 | 22.9 | |||||
Property and equipment, net of accumulated depreciation of $1,134.1 and $1,007.5, respectively | 1,632.4 | 1,649.9 | |||||
Goodwill | 1,173.9 | 1,173.5 | |||||
Other intangible assets, net of accumulated amortization of $201.1 and $185.6, respectively | 334.9 | 364.5 | |||||
Total assets | $ | 3,369.8 | $ | 3,422.3 | |||
Liabilities and Stockholders' Equity | |||||||
Current liabilities | |||||||
Accounts payable | $ | 84.2 | $ | 98.1 | |||
Accrued expenses | 132.5 | 135.7 | |||||
Deferred revenue | 60.8 | 63.1 | |||||
Current maturities of landfill retirement obligations | 30.9 | 30.2 | |||||
Current maturities of long-term debt | 34.9 | 49.1 | |||||
Total current liabilities | 343.3 | 376.2 | |||||
Other long-term liabilities | 56.4 | 55.8 | |||||
Long-term debt, less current maturities | 2,203.0 | 2,198.0 | |||||
Accrued landfill retirement obligations, less current maturities | 169.2 | 163.5 | |||||
Deferred income taxes | 134.3 | 139.0 | |||||
Total liabilities | 2,906.2 | 2,932.5 | |||||
Commitments and contingencies | |||||||
Equity | |||||||
Common stock: $.01 par value, 1,000,000,000 shares authorized, 64,493,536 issued and outstanding | 0.6 | 0.6 | |||||
Additional paid-in capital | 1,084.5 | 1,100.4 | |||||
Accumulated deficit | (621.5 | ) | (611.2 | ) | |||
Total stockholders' equity | 463.6 | 489.8 | |||||
Total liabilities and stockholders' equity | $ | 3,369.8 | $ | 3,422.3 |
(in millions, except share and per share data) | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Service revenues | $ | 360.6 | $ | 361.3 | $ | 1,052.6 | $ | 1,046.8 | |||||||
Operating costs and expenses | |||||||||||||||
Operating | 220.3 | 223.5 | 652.6 | 652.4 | |||||||||||
Selling, general and administrative | 35.6 | 37.3 | 119.7 | 110.4 | |||||||||||
Depreciation and amortization | 64.0 | 67.5 | 189.4 | 194.8 | |||||||||||
Acquisition and development costs | — | 0.2 | 0.2 | 1.3 | |||||||||||
Loss on disposal of assets and asset impairments | 1.1 | 0.3 | 1.2 | 17.8 | |||||||||||
Restructuring charges | — | — | 0.8 | — | |||||||||||
Total operating costs and expenses | 321.0 | 328.8 | 963.9 | 976.7 | |||||||||||
Operating income | 39.6 | 32.5 | 88.7 | 70.1 | |||||||||||
Other income (expense) | |||||||||||||||
Interest expense | (34.1 | ) | (34.2 | ) | (102.7 | ) | (104.0 | ) | |||||||
Other income (expense), net | 0.5 | (8.5 | ) | 0.9 | (4.7 | ) | |||||||||
Total other income (expense) | (33.6 | ) | (42.7 | ) | (101.8 | ) | (108.7 | ) | |||||||
Income (loss) before income taxes | 6.0 | (10.2 | ) | (13.1 | ) | (38.6 | ) | ||||||||
Income tax expense (benefit) | 2.2 | (4.7 | ) | (2.8 | ) | (13.8 | ) | ||||||||
Net income (loss) | $ | 3.8 | $ | (5.5 | ) | $ | (10.3 | ) | $ | (24.8 | ) | ||||
Net income (loss) attributable to common stockholders per share | |||||||||||||||
Basic earnings (loss) per share | $ | 0.06 | $ | (0.09 | ) | $ | (0.16 | ) | $ | (0.38 | ) | ||||
Diluted earnings (loss) per share | $ | 0.06 | $ | (0.09 | ) | $ | (0.16 | ) | $ | (0.38 | ) | ||||
Basic average shares outstanding | 64,493,536 | 64,493,536 | 64,493,536 | 64,493,536 | |||||||||||
Diluted average shares outstanding | 64,942,500 | 64,493,536 | 64,493,536 | 64,493,536 |
(in millions) | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income (loss) | $ | 3.8 | $ | (5.5 | ) | $ | (10.3 | ) | $ | (24.8 | ) | ||||
Other comprehensive loss, net of tax | — | — | — | (1.5 | ) | ||||||||||
Comprehensive income (loss) | $ | 3.8 | $ | (5.5 | ) | $ | (10.3 | ) | $ | (26.3 | ) |
Additional Paid-In Capital | Accumulated Deficit | Total Stockholders' Equity | ||||||||||||||||
(in millions, except share data) | Common Stock | |||||||||||||||||
Shares | Amount | |||||||||||||||||
Balance at December 31, 2015 | 64,493,536 | $ | 0.6 | $ | 1,100.4 | $ | (611.2 | ) | $ | 489.8 | ||||||||
Net loss | — | — | — | (10.3 | ) | (10.3 | ) | |||||||||||
Stock-based compensation expense | — | — | 4.0 | — | 4.0 | |||||||||||||
Return of capital to parent company | — | — | (19.9 | ) | — | (19.9 | ) | |||||||||||
Balance at September 30, 2016 | 64,493,536 | $ | 0.6 | $ | 1,084.5 | $ | (621.5 | ) | $ | 463.6 |
(in millions) | Nine Months Ended September 30, | ||||||
2016 | 2015 | ||||||
Cash flows from operating activities | |||||||
Net loss | $ | (10.3 | ) | $ | (24.8 | ) | |
Adjustments to reconcile net loss to net cash provided by operating activities | |||||||
Depreciation and amortization | 189.4 | 194.8 | |||||
Change in fair value of derivative instruments | (10.5 | ) | (8.7 | ) | |||
Amortization of interest rate cap premium | 0.3 | 1.5 | |||||
Amortization of debt issuance costs and original issue discount | 14.6 | 14.5 | |||||
Accretion on landfill retirement obligations | 9.8 | 10.0 | |||||
Other accretion and amortization | 1.4 | 1.9 | |||||
Provision for doubtful accounts | 2.4 | 2.7 | |||||
Loss on disposition of property and equipment | 2.8 | 0.8 | |||||
Impairment of assets | — | 6.4 | |||||
(Gain) loss on disposition of businesses | (1.6 | ) | 10.6 | ||||
Gain on redemption of security | — | (2.5 | ) | ||||
Stock based compensation | 4.0 | 1.6 | |||||
Deferred tax benefit | (4.8 | ) | (15.8 | ) | |||
Earnings in equity investee | (1.3 | ) | (1.1 | ) | |||
Changes in operating assets and liabilities, net of businesses acquired | |||||||
(Increase) decrease in accounts receivable | (3.8 | ) | 6.8 | ||||
Decrease in prepaid expenses and other current assets | 7.5 | 7.6 | |||||
(Increase) decrease in other assets | (0.4 | ) | 0.9 | ||||
Increase (decrease) in accounts payable | 0.1 | (1.8 | ) | ||||
Increase in accrued expenses and other long term liabilities | 7.7 | 14.9 | |||||
Decrease in unearned revenue | (2.5 | ) | (2.5 | ) | |||
Capping, closure and post-closure expenditures | (13.1 | ) | (11.2 | ) | |||
Net cash provided by operating activities | 191.7 | 206.6 | |||||
Cash flows from investing activities | |||||||
Purchases of property and equipment and construction and development | (124.2 | ) | (129.7 | ) | |||
Proceeds from sale of property and equipment | 2.2 | 1.7 | |||||
Proceeds from maturity of securities | — | 15.0 | |||||
Acquisition of businesses | (5.3 | ) | (25.0 | ) | |||
Proceeds from sale of businesses | 2.4 | 11.6 | |||||
Net cash used in investing activities | (124.9 | ) | (126.4 | ) | |||
Cash flows from financing activities | |||||||
Proceeds from borrowings on debt instruments | 102.0 | 35.0 | |||||
Repayment on debt instruments including capital leases | (149.0 | ) | (103.9 | ) | |||
Bank overdraft | — | (1.3 | ) | ||||
Other financing activities | — | (1.1 | ) | ||||
Capital contribution from parent | — | 0.5 | |||||
Return of capital to parent | (19.9 | ) | (7.5 | ) | |||
Net cash used in financing activities | (66.9 | ) | (78.3 | ) | |||
Net (decrease) increase in cash and cash equivalents | (0.1 | ) | 1.9 | ||||
Cash and cash equivalents, beginning of period | 0.6 | 1.0 | |||||
Cash and cash equivalents, end of period | $ | 0.5 | $ | 2.9 |
1. | Business Operations |
2. | Basis of Presentation |
3. | Landfill Liabilities |
Balance at December 31, 2014 | $ | 201.1 | |
Increase in retirement obligation | 9.8 | ||
Accretion of closure and post-closure costs | 13.1 | ||
Disposition | (3.2 | ) | |
Change in estimate | (2.9 | ) | |
Costs incurred | (24.2 | ) | |
Balance at December 31, 2015 | 193.7 | ||
Increase in retirement obligation | 7.1 | ||
Accretion of closure and post-closure costs | 9.8 | ||
Costs incurred | (10.5 | ) | |
Balance at September 30, 2016 | 200.1 | ||
Less: Current portion | (30.9 | ) | |
$ | 169.2 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Numerator: (Dollars in millions) | ||||||||||||||||
Net income (loss) | $ | 3.8 | $ | (5.5 | ) | $ | (10.3 | ) | $ | (24.8 | ) | |||||
Denominator: | ||||||||||||||||
Average common shares outstanding | 64,493,536 | 64,493,536 | 64,493,536 | 64,493,536 | ||||||||||||
Other potentially dilutive common shares | 448,964 | — | — | — | ||||||||||||
Average common shares outstanding, assuming dilution | 64,942,500 | 64,493,536 | 64,493,536 | 64,493,536 | ||||||||||||
Net income (loss) per share, basic | $ | 0.06 | $ | (0.09 | ) | $ | (0.16 | ) | $ | (0.38 | ) | |||||
Net income (loss) per share, assuming dilution | $ | 0.06 | $ | (0.09 | ) | $ | (0.16 | ) | $ | (0.38 | ) |
5. | Debt |
September 30, 2016 | December 31, 2015 | ||||||
Revolving line of credit with lenders (Revolver), interest at applicable rate plus margin, as defined (5.51% and 6.30% at September 30, 2016 and December 31, 2015, respectively) due quarterly; balance due at maturity in October 2019 | $ | — | $ | 32.0 | |||
Term loans (Term Loan B); quarterly payments of $4.5 commencing March 31, 2013 through June 30, 2019 with final payment due October 9, 2019; interest at LIBOR floor of 0.75% plus an applicable margin of 300 basis points at September 30, 2016 and December 31, 2015 | 1,685.5 | 1,685.5 | |||||
Senior notes (Senior Notes) payable; interest at 8.25% payable in arrears semi-annually commencing April 1, 2013; maturing on October 1, 2020 | 550.0 | 550.0 | |||||
Capital lease obligations, maturing through 2024 | 42.8 | 28.2 | |||||
Other debt | 15.3 | 20.0 | |||||
2,293.6 | 2,315.7 | ||||||
Less: Original issue discount and debt issuance costs classified as a reduction to long-term debt | (55.7 | ) | (68.6 | ) | |||
Less: Current portion | (34.9 | ) | (49.1 | ) | |||
$ | 2,203.0 | $ | 2,198.0 |
6. | Derivative Instruments and Hedging Activities |
Balance Sheet Location | September 30, 2016 | December 31, 2015 | ||||||||
Derivatives Designated as Hedging Instruments | ||||||||||
2012 Interest rate caps | Other assets | $ | — | $ | 0.2 | |||||
Derivatives Not Designated as Hedging Instruments | ||||||||||
2016 Interest rate caps | Accrued expenses | 0.7 | — | |||||||
2016 Interest rate caps | Other long term liabilities | 1.9 | — | |||||||
Fuel commodity derivatives | Accrued expenses | 3.1 | 16.2 | |||||||
Total derivatives | $ | 5.7 | $ | 16.0 |
8. | Commitments and Contingencies |
9. | Segment and Related Information |
Service Revenues | Operating Income (Loss) | Depreciation and Amortization | |||||||||
Three Months Ended September 30, 2016 | |||||||||||
South | $ | 126.4 | $ | 21.8 | $ | 18.5 | |||||
East | 93.7 | 8.6 | 18.5 | ||||||||
Midwest | 140.5 | 21.9 | 24.8 | ||||||||
Corporate | — | (12.7 | ) | 2.2 | |||||||
$ | 360.6 | $ | 39.6 | $ | 64.0 | ||||||
Three Months Ended September 30, 2015 | |||||||||||
South | $ | 122.5 | $ | 21.4 | $ | 18.1 | |||||
East | 95.4 | 7.9 | 20.0 | ||||||||
Midwest | 143.4 | 17.5 | 27.3 | ||||||||
Corporate | — | (14.3 | ) | 2.1 | |||||||
$ | 361.3 | $ | 32.5 | $ | 67.5 | ||||||
Nine Months Ended September 30, 2016 | |||||||||||
South | $ | 373.7 | $ | 63.6 | $ | 55.7 | |||||
East | 278.2 | 21.4 | 55.1 | ||||||||
Midwest | 400.7 | 53.8 | 72.3 | ||||||||
Corporate | — | (50.1 | ) | 6.3 | |||||||
$ | 1,052.6 | $ | 88.7 | $ | 189.4 | ||||||
Nine Months Ended September 30, 2015 | |||||||||||
South | $ | 368.6 | $ | 49.8 | $ | 54.6 | |||||
East | 272.8 | 16.4 | 56.7 | ||||||||
Midwest | 405.4 | 45.5 | 77.3 | ||||||||
Corporate | — | (41.6 | ) | 6.2 | |||||||
$ | 1,046.8 | $ | 70.1 | $ | 194.8 |
Fair Value Measurement at September 30, 2016 Reporting Date Using | |||||||||||||||||||||||
Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total Gains (Losses) | Carrying Value | ||||||||||||||||||
Recurring fair value measurements | |||||||||||||||||||||||
Cash and cash equivalents | $ | 0.5 | $ | 0.5 | $ | — | $ | — | $ | — | $ | 0.5 | |||||||||||
Derivative instruments - Liability position | (5.7 | ) | — | (5.7 | ) | — | — | (5.7 | ) | ||||||||||||||
Total recurring fair value measurements | $ | (5.2 | ) | $ | 0.5 | $ | (5.7 | ) | $ | — | $ | — | $ | (5.2 | ) | ||||||||
Fair Value Measurement at December 31, 2015 Reporting Date Using | |||||||||||||||||||||||
Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total Gains (Losses) | Carrying Value | ||||||||||||||||||
Recurring fair value measurements | |||||||||||||||||||||||
Cash and cash equivalents | $ | 0.6 | $ | 0.6 | $ | — | $ | — | $ | — | $ | 0.6 | |||||||||||
Derivative instruments - Asset position | 0.2 | — | 0.2 | — | — | 0.2 | |||||||||||||||||
Derivative instruments - Liability position | (16.2 | ) | $ | — | (16.2 | ) | — | — | (16.2 | ) | |||||||||||||
Total recurring fair value measurements | $ | (15.4 | ) | $ | 0.6 | $ | (16.0 | ) | $ | — | $ | — | $ | (15.4 | ) |
September 30, 2016 | December 31, 2015 | ||||||
Revolver | $ | — | $ | 32.0 | |||
Senior Notes | 577.5 | 555.5 | |||||
Term Loan B | 1,689.7 | 1,639.2 | |||||
$ | 2,267.2 | $ | 2,226.7 |
Company (Parent) | Guarantor Subsidiaries | Non-Guarantor Subsidiary | Eliminations | Consolidated | |||||||||||||||
Assets | |||||||||||||||||||
Current assets | |||||||||||||||||||
Cash and cash equivalents | $ | — | $ | 0.2 | $ | 0.3 | $ | — | $ | 0.5 | |||||||||
Accounts receivable | — | 179.6 | — | — | 179.6 | ||||||||||||||
Prepaid expenses and other current assets | 6.8 | 18.9 | — | — | 25.7 | ||||||||||||||
Total current assets | 6.8 | 198.7 | 0.3 | — | 205.8 | ||||||||||||||
Other assets | 7.8 | 5.1 | 9.9 | — | 22.8 | ||||||||||||||
Property and equipment, net | 10.2 | 1,622.2 | — | — | 1,632.4 | ||||||||||||||
Goodwill | — | 1,173.9 | — | — | 1,173.9 | ||||||||||||||
Other intangible assets, net | 95.4 | 239.5 | — | — | 334.9 | ||||||||||||||
Investment in consolidated subsidiaries | 2,781.2 | — | — | (2,781.2 | ) | — | |||||||||||||
Total assets | $ | 2,901.4 | $ | 3,239.4 | $ | 10.2 | $ | (2,781.2 | ) | $ | 3,369.8 | ||||||||
Liabilities and Stockholders’ Equity | |||||||||||||||||||
Current liabilities | |||||||||||||||||||
Accounts payable | $ | 15.7 | $ | 63.0 | $ | 5.5 | $ | — | $ | 84.2 | |||||||||
Accrued expenses | 63.3 | 69.2 | — | — | 132.5 | ||||||||||||||
Deferred revenue | — | 60.8 | — | — | 60.8 | ||||||||||||||
Current maturities of landfill retirement obligations | — | 30.9 | — | — | 30.9 | ||||||||||||||
Current maturities of long-term debt | 16.4 | 18.5 | — | — | 34.9 | ||||||||||||||
Total current liabilities | 95.4 | 242.4 | 5.5 | — | 343.3 | ||||||||||||||
Other long-term liabilities, less current maturities | 42.6 | 13.8 | — | — | 56.4 | ||||||||||||||
Long-term debt, less current maturities | 2,165.5 | 37.5 | — | — | 2,203.0 | ||||||||||||||
Accrued landfill retirement obligations, less current maturities | — | 169.2 | — | — | 169.2 | ||||||||||||||
Deferred income taxes | 134.3 | — | — | — | 134.3 | ||||||||||||||
Total liabilities | 2,437.8 | 462.9 | 5.5 | — | 2,906.2 | ||||||||||||||
Equity | |||||||||||||||||||
Total stockholders’ equity | 463.6 | 2,776.5 | 4.7 | (2,781.2 | ) | 463.6 | |||||||||||||
Total liabilities and stockholders’ equity | $ | 2,901.4 | $ | 3,239.4 | $ | 10.2 | $ | (2,781.2 | ) | $ | 3,369.8 |
Company (Parent) | Guarantor Subsidiaries | Non-Guarantor Subsidiary | Eliminations | Consolidated | |||||||||||||||
Service revenues | $ | — | $ | 360.6 | $ | — | $ | — | $ | 360.6 | |||||||||
Operating costs and expenses | |||||||||||||||||||
Operating | — | 220.3 | — | — | 220.3 | ||||||||||||||
Selling, general and administrative | 10.6 | 25.0 | — | — | 35.6 | ||||||||||||||
Depreciation and amortization | 2.2 | 61.8 | — | — | 64.0 | ||||||||||||||
Loss on disposal of assets | — | 1.1 | — | — | 1.1 | ||||||||||||||
Total operating costs and expenses | 12.8 | 308.2 | — | — | 321.0 | ||||||||||||||
Operating (loss) income | (12.8 | ) | 52.4 | — | — | 39.6 | |||||||||||||
Other income (expense) | |||||||||||||||||||
Equity in income (loss) of consolidated subsidiaries | 52.2 | — | — | (52.2 | ) | — | |||||||||||||
Interest expense | (33.4 | ) | (0.7 | ) | — | — | (34.1 | ) | |||||||||||
Other (expense) income, net | — | 0.3 | 0.2 | — | 0.5 | ||||||||||||||
Total other income (expense) | 18.8 | (0.4 | ) | 0.2 | (52.2 | ) | (33.6 | ) | |||||||||||
Income (loss) before income taxes | 6.0 | 52.0 | 0.2 | (52.2 | ) | 6.0 | |||||||||||||
Income tax expense (benefit) | 2.2 | 20.3 | 0.1 | (20.4 | ) | 2.2 | |||||||||||||
Net income (loss) | $ | 3.8 | $ | 31.7 | $ | 0.1 | $ | (31.8 | ) | $ | 3.8 |
Company (Parent) | Combined Guarantor Subsidiaries | Non-Guarantor Subsidiary | Eliminations | Consolidated | |||||||||||||||
Service revenues | $ | — | $ | 1,052.6 | $ | — | $ | — | $ | 1,052.6 | |||||||||
Operating costs and expenses | |||||||||||||||||||
Operating | — | 652.6 | — | — | 652.6 | ||||||||||||||
Selling, general and administrative | 34.7 | 85.0 | — | — | 119.7 | ||||||||||||||
Depreciation and amortization | 6.3 | 183.1 | — | — | 189.4 | ||||||||||||||
Acquisition and development costs | 0.2 | — | — | — | 0.2 | ||||||||||||||
Loss on disposal of assets | — | 1.2 | — | — | 1.2 | ||||||||||||||
Restructuring charges | 0.8 | — | — | — | 0.8 | ||||||||||||||
Total operating costs and expenses | 42.0 | 921.9 | — | — | 963.9 | ||||||||||||||
Operating (loss) income | (42.0 | ) | 130.7 | — | — | 88.7 | |||||||||||||
Other income (expense) | |||||||||||||||||||
Equity in income (loss) of consolidated subsidiaries | 131.0 | — | — | (131.0 | ) | — | |||||||||||||
Interest expense | (100.9 | ) | (1.8 | ) | — | — | (102.7 | ) | |||||||||||
Other (expense) income, net | (1.2 | ) | 0.8 | 1.3 | — | 0.9 | |||||||||||||
Total other income (expense) | 28.9 | (1.0 | ) | 1.3 | (131.0 | ) | (101.8 | ) | |||||||||||
(Loss) income before income taxes | (13.1 | ) | 129.7 | 1.3 | (131.0 | ) | (13.1 | ) | |||||||||||
Income tax (benefit) expense | (2.8 | ) | 50.7 | 0.5 | (51.2 | ) | (2.8 | ) | |||||||||||
Net (loss) income | $ | (10.3 | ) | $ | 79.0 | $ | 0.8 | $ | (79.8 | ) | $ | (10.3 | ) |
Company (Parent) | Combined Guarantor Subsidiaries | Non-Guarantor Subsidiary | Eliminations | Consolidated | |||||||||||||||
Cash flows from operating activities | |||||||||||||||||||
Net cash (used in) provided by operating activities | (89.9 | ) | 280.8 | 0.8 | — | 191.7 | |||||||||||||
Cash flows from investing activities | |||||||||||||||||||
Purchases of property and equipment and construction and development | (1.4 | ) | (122.8 | ) | — | — | (124.2 | ) | |||||||||||
Proceeds from sale of property and equipment | — | 2.2 | — | — | 2.2 | ||||||||||||||
Acquisition of businesses | — | (5.3 | ) | — | — | (5.3 | ) | ||||||||||||
Proceeds from sale of businesses | — | 2.4 | — | — | 2.4 | ||||||||||||||
Net cash used in investing activities | (1.4 | ) | (123.5 | ) | — | — | (124.9 | ) | |||||||||||
Cash flows from financing activities | |||||||||||||||||||
Proceeds from borrowings on debt instruments | 102.0 | — | — | — | 102.0 | ||||||||||||||
Repayment on debt instruments | (149.0 | ) | — | — | — | (149.0 | ) | ||||||||||||
Return of capital to parent | (19.9 | ) | 0.9 | (0.9 | ) | — | (19.9 | ) | |||||||||||
Intercompany cash transfers | 158.2 | (158.2 | ) | — | — | — | |||||||||||||
Net cash provided by (used in) financing activities | 91.3 | (157.3 | ) | (0.9 | ) | — | (66.9 | ) | |||||||||||
Net (decrease) increase in cash and cash equivalents | — | — | (0.1 | ) | — | (0.1 | ) | ||||||||||||
Cash and cash equivalents, beginning of period | — | 0.2 | 0.4 | — | 0.6 | ||||||||||||||
Cash and cash equivalents, end of period | $ | — | $ | 0.2 | $ | 0.3 | $ | — | $ | 0.5 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Service revenues | $ | 360.6 | 100.0 | % | $ | 361.3 | 100.0 | % | $ | 1,052.6 | 100.0 | % | $ | 1,046.8 | 100.0 | % | |||||||||||
Operating costs and expenses | |||||||||||||||||||||||||||
Operating expenses | 220.3 | 61.1 | % | 223.5 | 61.9 | % | 652.6 | 62.0 | % | 652.4 | 62.3 | % | |||||||||||||||
Selling, general and administrative | 35.6 | 9.9 | % | 37.3 | 10.3 | % | 119.7 | 11.4 | % | 110.4 | 10.5 | % | |||||||||||||||
Depreciation and amortization | 64.0 | 17.7 | % | 67.5 | 18.7 | % | 189.4 | 18.0 | % | 194.8 | 18.6 | % | |||||||||||||||
Acquisition and development charges | — | — | % | 0.2 | 0.1 | % | 0.2 | — | % | 1.3 | 0.1 | % | |||||||||||||||
Loss on disposal of assets and asset impairments | 1.1 | 0.3 | % | 0.3 | 0.1 | % | 1.2 | 0.1 | % | 17.8 | 1.7 | % | |||||||||||||||
Restructuring charges | — | — | % | — | — | % | 0.8 | 0.1 | % | — | — | % | |||||||||||||||
Total operating costs and expenses | 321.0 | 89.0 | % | 328.8 | 91.0 | % | 963.9 | 91.6 | % | 976.7 | 93.3 | % | |||||||||||||||
Operating income | $ | 39.6 | 11.0 | % | $ | 32.5 | 9.0 | % | $ | 88.7 | 8.4 | % | $ | 70.1 | 6.7 | % |
• | Lower depreciation and amortization of $3.6 primarily due to a reduction in landfill depletion and amortization as a result of an increase in deemed permitted expansion airspace resulting from favorable developments in permitting activities at several of our landfills; |
• | Increased environmental fees of $3.1 due to an increased rate that went into effect in July 2016; and |
• | Lower professional fees of $1.0 resulting from a reduction in consulting fees associated with internal control evaluation and implementation. |
• | Losses on disposal of businesses and impairment charges recorded in the 2015 period of $17.3 relating to strategic decisions regarding divestitures in our South segment and discontinuing the pursuit of permitting at one landfill site in our East segment; |
• | Higher revenue of $5.8 primarily due to an increase in average yield and revenue from prior year acquisitions partially offset by lower fuel fee revenue, a decrease in organic volume and lower revenue due to divestitures; |
• | Lower depreciation and amortization of $5.4 primarily due to a reduction in landfill depletion and amortization as a result of an increase in deemed permitted expansion airspace resulting from favorable developments in permitting activities at several of our landfills; |
• | Higher expenses of $7.1 related to the launch of the February initial public offering process, including the amendment of our credit agreement that was contingent on an initial public offering; and |
• | Higher stock based compensation expense of $2.4 as a result of a larger portion of our compensation structure shifting to stock based awards. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Collection | $ | 247.7 | 68.7 | % | $ | 247.5 | 68.5 | % | $ | 734.0 | 69.7 | % | $ | 728.1 | 69.6 | % | |||||||||||
Disposal | 137.3 | 38.1 | % | 133.7 | 37.0 | % | 391.3 | 37.2 | % | 372.2 | 35.6 | % | |||||||||||||||
Sale of recyclables | 6.6 | 1.8 | % | 7.0 | 1.9 | % | 16.3 | 1.5 | % | 18.8 | 1.8 | % | |||||||||||||||
Fuel fees and environmental fees | 24.7 | 6.8 | % | 23.4 | 6.5 | % | 64.6 | 6.1 | % | 64.4 | 6.2 | % | |||||||||||||||
Other revenue | 16.9 | 4.7 | % | 19.1 | 5.3 | % | 55.5 | 5.3 | % | 62.7 | 6.0 | % | |||||||||||||||
Intercompany eliminations | (72.6 | ) | (20.1 | )% | (69.4 | ) | (19.2 | )% | (209.1 | ) | (19.9 | )% | (199.4 | ) | (19.0 | )% | |||||||||||
Total service revenues | $ | 360.6 | 100.0 | % | $ | 361.3 | 100.0 | % | $ | 1,052.6 | 100.0 | % | $ | 1,046.8 | 100.0 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||
Average yield | 2.3 | % | 2.6 | % | 2.0 | % | 2.2 | % | |||
Recycling | 0.2 | % | (0.2 | )% | 0.1 | % | (0.6 | )% | |||
Fuel fee revenue | (0.6 | )% | (1.4 | )% | (0.9 | )% | (1.2 | )% | |||
Total yield | 1.9 | % | 1.0 | % | 1.2 | % | 0.4 | % | |||
Organic volume | (3.2 | )% | (2.2 | )% | (1.2 | )% | (0.5 | )% | |||
Acquisitions | 1.7 | % | 1.2 | % | 1.9 | % | 1.1 | % | |||
Divestitures | (0.6 | )% | (1.8 | )% | (1.3 | )% | (1.2 | )% | |||
Total revenue growth | (0.2 | )% | (1.8 | )% | 0.6 | % | (0.2 | )% |
• | Average yield increased revenue by 2.3% for the three months ended September 30, 2016 primarily due to positive pricing in our commercial collection business, rolloff collection business, MSW disposal business and special waste disposal business. Additionally, our environmental fee contributed to the increase due to a rate increase that went into effect in July 2016. |
• | Fuel fee revenue decreased revenue by 0.6% during the three months ended September 30, 2016. These fees fluctuate in response to changes in prices for diesel fuel on which the surcharge is based and, consequently, any decrease in fuel prices |
• | Organic volume decreased revenue by 3.2% during the three months ended September 30, 2016 primarily due to the loss of residential contracts in our Midwest segment, lower shale volumes in our East segment and lower special waste disposal volumes across all of our segments. |
• | Acquisitions increased revenue by 1.7% during the three months ended September 30, 2016 due to our execution of acquisition opportunities that further enhance our vertical integration strategy. |
• | Divestitures decreased revenue by 0.6% during the three months ended September 30, 2016 due to our strategic decisions to divest low margin businesses. |
• | Average yield increased revenue by 2.0% for the nine months ended September 30, 2016 primarily due to positive pricing in our commercial collection business, rolloff collection business, MSW disposal business and special waste disposal business. Additionally, our environmental fee contributed to the increase due to rate increases that went into effect in July 2015 and July 2016. |
• | Fuel fee revenue decreased revenue by 0.9% during the nine months ended September 30, 2016. These fees fluctuate in response to changes in prices for diesel fuel on which the surcharge is based and, consequently, any decrease in fuel prices results in a decrease in our revenue. Lower fuel fee revenue for the nine months ended September 30, 2016 resulted from the decrease in diesel fuel prices. |
• | Organic volume decreased revenue by 1.2% during the nine months ended September 30, 2016 primarily due to the loss of residential contracts in our Midwest segment and lower shale volumes in our East segment partially offset by increased disposal volume across our MSW and C&D waste streams, most notably in our South and East segments. |
• | Acquisitions increased revenue by 1.9% during the nine months ended September 30, 2016 due to our execution of acquisition opportunities that further enhance our vertical integration strategy. |
• | Divestitures decreased revenue by 1.3% during the nine months ended September 30, 2016 due to our strategic decisions to divest low margin businesses. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Operating | $ | 217.0 | 60.2 | % | $ | 220.2 | 60.9 | % | $ | 642.8 | 61.1 | % | $ | 642.4 | 61.4 | % | |||||||||||
Accretion of landfill retirement obligations | 3.3 | 0.9 | % | 3.3 | 0.9 | % | 9.8 | 0.9 | % | 10.0 | 1.0 | % | |||||||||||||||
Operating expenses | $ | 220.3 | 61.1 | % | $ | 223.5 | 61.9 | % | $ | 652.6 | 62.0 | % | $ | 652.4 | 62.3 | % |
• | Labor and related benefits, which consist of salaries and wages, health and welfare benefits, incentive compensation and payroll taxes; |
• | Transfer and disposal costs which include tipping fees paid to third-party disposal facilities and transfer stations as well as transportation and subcontractor costs (which include costs for independent haulers who transport waste from transfer stations to our disposal facilities and costs for local operators who provide waste handling services associated with markets outside our standard operating areas); |
• | Maintenance and repairs expenses which include labor, maintenance and repairs to our vehicles, equipment and containers; |
• | Fuel costs which include the direct cost of fuel used by our vehicles, net of fuel tax credits; |
• | Franchise fees and taxes which consist of municipal franchise fees, host community fees and royalties; |
• | Risk management expenses which include casualty insurance premiums, claims payments and estimates for claims incurred but not reported; |
• | Other expenses which include expenses such as facility operating costs, equipment rent, leachate treatment and disposal, and other landfill maintenance costs; and |
• | Accretion expense related to landfill capping, closure and post-closure is included in operating expenses in our condensed consolidated income statements, but, it is excluded from the table below (refer to “Accretion of Landfill Retirement Obligations” for a detailed discussion of the changes in amounts). |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Labor and related benefits | $ | 73.8 | 20.5 | % | $ | 72.4 | 20.0 | % | $ | 220.2 | 20.9 | % | $ | 214.0 | 20.4 | % | |||||||||||
Transfer and disposal costs | 48.4 | 13.4 | % | 51.0 | 14.1 | % | 142.0 | 13.5 | % | 146.2 | 14.0 | % | |||||||||||||||
Maintenance and repairs | 33.2 | 9.2 | % | 32.7 | 9.1 | % | 98.4 | 9.3 | % | 92.7 | 8.9 | % | |||||||||||||||
Fuel | 14.2 | 3.9 | % | 16.7 | 4.6 | % | 40.4 | 3.8 | % | 52.9 | 5.1 | % | |||||||||||||||
Franchise fees and taxes | 17.4 | 4.8 | % | 17.9 | 5.0 | % | 49.0 | 4.7 | % | 50.2 | 4.8 | % | |||||||||||||||
Risk management | 7.4 | 2.1 | % | 7.4 | 2.0 | % | 22.8 | 2.2 | % | 20.2 | 1.9 | % | |||||||||||||||
Other | 22.6 | 6.3 | % | 22.1 | 6.1 | % | 70.0 | 6.7 | % | 66.2 | 6.3 | % | |||||||||||||||
Operating expenses, excluding accretion expense | $ | 217.0 | 60.2 | % | $ | 220.2 | 60.9 | % | $ | 642.8 | 61.1 | % | $ | 642.4 | 61.4 | % |
• | Labor and related benefits increased by $1.4 or 1.9% to $73.8 which was primarily attributable to merit increases, acquisition activity and higher health care costs; |
• | Transfer and disposal costs decreased by $2.6 or 5.1% to $48.4 primarily due to the divestiture of three transfer stations in the second quarter of 2016, the divestiture of a recycling facility in the fourth quarter of 2015 and decreased shale related disposal activity; |
• | Maintenance and repairs expense increased by $0.5 or 1.5% to $33.2. The increase was driven primarily by the implementation of a standardized maintenance plan on our collection fleet and landfill equipment which resulted in increased labor costs; |
• | Fuel costs decreased $2.5 or 15.0% to $14.2 primarily resulting from decreases in fuel prices and converting trucks to compressed natural gas fuel, which is less expensive than diesel fuel; |
• | Franchise fees and taxes decreased $0.5 or 2.8% to $17.4 primarily due to changes in the mix of waste in the Midwest and East segments; and |
• | Other operating costs increased $0.5 or 2.3% to $22.6 primarily due to increased landfill site maintenance costs. |
• | Labor and related benefits increased by $6.2 or 2.9% to $220.2 which was primarily attributable to merit increases, acquisition activity, startup costs for new municipal contracts and acquisitions and higher health care costs. The increases were partially offset by disposals of certain businesses and a $1.3 reduction in workers compensation costs; |
• | Transfer and disposal costs decreased by $4.2 or 2.9% to $142.0 due to the sale of a small brokerage business in April 2015, the divestiture of three transfer stations in April 2016 and lower costs due to decreased shale related disposal activity. These decreases were partially offset by increased container weights during the first quarter of 2016; |
• | Maintenance and repairs expense increased by $5.7 or 6.1% to $98.4. The increase was driven primarily by the implementation of a standardized maintenance plan on our collection fleet and landfill equipment which resulted in increased labor and material costs. Additionally, costs increased as a result of start up costs for new municipal contracts and acquisitions; |
• | Fuel costs decreased $12.5 or 23.6% to $40.4 primarily resulting from decreases in fuel prices and converting trucks to compressed natural gas fuel, which is less expensive than diesel fuel; |
• | Franchise fees and taxes decreased $1.2 or 2.4% to $49.0 primarily due to changes in the mix of waste in the Midwest and East segments, partially offset by higher costs in our South segment due mainly to increased volumes; |
• | Risk management expenses increased $2.6 or 12.9% to $22.8. The nine months ended September 30, 2015 benefited $0.8 from the favorable settlement of a legacy claim and favorable actuarial development in our vehicle liability insurance programs which did not reoccur in the nine months ended September 30, 2016. |
• | Other operating costs increased $3.8 or 5.7% to $70.0 primarily due to increased landfill site and other facility maintenance costs of $2.5 and increased costs related to leachate treatment and disposal due to wet weather of $1.3. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Salaries | $ | 21.9 | 6.1 | % | $ | 22.8 | 6.3 | % | $ | 71.9 | 6.8 | % | $ | 68.1 | 6.5 | % | |||||||||||
Legal and professional | 2.2 | 0.6 | % | 3.8 | 1.1 | % | 14.3 | 1.4 | % | 9.2 | 0.9 | % | |||||||||||||||
Other | 11.5 | 3.2 | % | 10.7 | 3.0 | % | 33.5 | 3.2 | % | 33.1 | 3.2 | % | |||||||||||||||
Total selling, general and administrative expenses | $ | 35.6 | 9.9 | % | $ | 37.3 | 10.3 | % | $ | 119.7 | 11.4 | % | $ | 110.4 | 10.5 | % |
• | Our salaries expenses decreased by $0.9 or 3.9% to $22.0 primarily attributable to lower estimated incentive compensation expense. |
• | Legal and professional fees decreased $1.6 or 42.1% to $2.2 which was primarily the result of a reduction in professional fees of $1.0 due to a reduction in consulting fees associated with internal control evaluation and implementation and a $0.5 decrease in legal fees due to reduced legal claim activity. |
• | Other selling, general and administrative expenses increased $0.8 or 7.5% to $11.4 primarily due to increased bad debt expense of $0.3, higher bank charges of $0.2 and higher telecommunications charges of $0.2. |
• | Our salaries expenses increased by $3.8 or 5.6% to $72.7 primarily attributable to higher stock based compensation expense of $2.4 as a result of a larger portion of our compensation structure shifting to stock based awards. The remainder of the variance is primarily due to merit increases and acquisition activity, partially offset by lower severance and estimated incentive compensation expense. |
• | Legal and professional fees increased $5.1 or 55.4% to $14.3 which was primarily the result of expenses related to the February launch of the initial public offering process in the amount of $7.1, including the amendment of our credit agreement. The increase was partially offset by a reduction in professional fees of $1.0 due to a reduction in consulting fees associated with internal control evaluation and implementation and a $0.6 decrease in legal fees due to reduced legal claim activity. |
• | Other selling, general and administrative expenses increased $0.4 or 1.2% to $33.5 which is relatively consistent with the prior period. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Depreciation, amortization and depletion of property and equipment | $ | 53.6 | 14.9 | % | $ | 56.4 | 15.6 | % | $ | 157.2 | 14.9 | % | $ | 162.3 | 15.5 | % | |||||||||||
Amortization of other intangible assets | 10.4 | 2.9 | % | 11.1 | 3.1 | % | 32.2 | 3.1 | % | 32.5 | 3.1 | % | |||||||||||||||
Depreciation and amortization | $ | 64.0 | 17.7 | % | $ | 67.5 | 18.7 | % | $ | 189.4 | 18.0 | % | $ | 194.8 | 18.6 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Depreciation and amortization of property and equipment | $ | 32.0 | 8.9 | % | $ | 31.7 | 8.8 | % | $ | 95.4 | 9.1 | % | $ | 95.0 | 9.1 | % | |||||||||||
Landfill depletion and amortization | 21.6 | 6.0 | % | 24.7 | 6.8 | % | 61.8 | 5.9 | % | 67.3 | 6.4 | % | |||||||||||||||
Depreciation, amortization and depletion of property and equipment | $ | 53.6 | 14.9 | % | $ | 56.4 | 15.6 | % | $ | 157.2 | 14.9 | % | $ | 162.3 | 15.5 | % |
• | Depreciation and amortization of property and equipment increased $0.3 or 0.9% to $32.0 for the three months ended September 30, 2016, as compared to the three months ended September 30, 2015 due to purchases of property and equipment in the normal course of business. |
• | Landfill depletion and amortization decreased $3.1 or 12.6% to $21.6 for the three months ended September 30, 2016, as compared to the three months ended September 30, 2015 primarily due to an increase in deemed permitted expansion airspace resulting from favorable developments in permitting activities at several of our landfills. |
• | Depreciation and amortization of property and equipment increased $0.4 or 0.4% to $95.4 for the nine months ended September 30, 2016, as compared to the nine months ended September 30, 2015 due to purchases of property and equipment in the normal course of business. |
• | Landfill depletion and amortization decreased $5.5 or 8.2% to $61.8 for the nine months ended September 30, 2016, as compared to the nine months ended September 30, 2015 primarily due to an increase in deemed permitted expansion airspace resulting from favorable developments in permitting activities at several of our landfills. The impact of increased deemed permitted airspace was partially offset by increased disposal volumes. |
Service Revenues | Operating Income (Loss) | Depreciation and Amortization | |||||||||
Three Months Ended September 30, 2016 | |||||||||||
South | $ | 126.4 | $ | 21.8 | $ | 18.5 | |||||
East | 93.7 | 8.6 | 18.5 | ||||||||
Midwest | 140.5 | 21.9 | 24.8 | ||||||||
Corporate | — | (12.7 | ) | 2.2 | |||||||
$ | 360.6 | $ | 39.6 | $ | 64.0 | ||||||
Three Months Ended September 30, 2015 | |||||||||||
South | $ | 122.5 | $ | 21.4 | $ | 18.1 | |||||
East | 95.4 | 7.9 | 20.0 | ||||||||
Midwest | 143.4 | 17.5 | 27.3 | ||||||||
Corporate | — | (14.3 | ) | 2.1 | |||||||
$ | 361.3 | $ | 32.5 | $ | 67.5 | ||||||
Nine Months Ended September 30, 2016 | |||||||||||
South | $ | 373.7 | $ | 63.6 | $ | 55.7 | |||||
East | 278.2 | 21.4 | 55.1 | ||||||||
Midwest | 400.7 | 53.8 | 72.3 | ||||||||
Corporate | — | (50.1 | ) | 6.3 | |||||||
$ | 1,052.6 | $ | 88.7 | $ | 189.4 | ||||||
Nine Months Ended September 30, 2015 | |||||||||||
South | $ | 368.6 | $ | 49.8 | $ | 54.6 | |||||
East | 272.8 | 16.4 | 56.7 | ||||||||
Midwest | 405.4 | 45.5 | 77.3 | ||||||||
Corporate | — | (41.6 | ) | 6.2 | |||||||
$ | 1,046.8 | $ | 70.1 | $ | 194.8 |
September 30, 2016 | December 31, 2015 | ||||||
Cash and cash equivalents | $ | 0.5 | $ | 0.6 | |||
Debt: | |||||||
Current portion | 34.9 | 49.1 | |||||
Long-term portion | 2,203.0 | 2,198.0 | |||||
Total debt | $ | 2,237.9 | $ | 2,247.1 |
Nine months ended September 30, | |||||||
2016 | 2015 | ||||||
Net cash provided by operating activities | $ | 191.7 | $ | 206.6 | |||
Net cash used in investing activities | (124.9 | ) | (126.4 | ) | |||
Net cash used in financing activities | (66.9 | ) | (78.3 | ) |
• | An increase in accounts receivable in the nine months ended September 30, 2016 compared to a decrease in the comparable prior period which accounted for $10.6 of the variance. The accounts receivable decrease in the prior year was due to increased emphasis on collection activities starting in late 2014 that resulted in significant improvement in days sales outstanding throughout 2015. As of September 30, 2016, our days sales outstanding were 45.8, or 30.3 days net of deferred revenue, consistent with our days sales outstanding as of September 30, 2015. |
• | A smaller increase in accrued expenses and other long term liabilities in the nine months ended September 30, 2016 compared to the same period in 2015 which accounted for $7.2 of the variance. This is primarily due to losses related to fuel derivatives that were accrued in the previous year and paid in the current year; |
• | Cash paid for income taxes (net of refunds) was $1.4 and $2.0 for the nine months ended September 30, 2016 and 2015, respectively. |
• | Cash paid for interest was $75.4 and $76.0 for the nine months ended September 30, 2016 and 2015, respectively. |
• | A reduction of $19.7 in cash expenditures used to fund acquisitions; |
• | Lower cash expenditures of $5.5 used to fund the purchase of property and equipment and construction and development; |
• | Lower proceeds from the maturity of securities of $15.0; and |
• | Lower proceeds from the sale of businesses of $9.2 due to prior year divestitures. |
• | A decrease in net repayments on debt instruments of $21.9 due to lower cash provided by operating activities; and |
• | An increase in capital returned to the parent of $12.4. |
Period | Maximum Total Leverage Ratio | ||
December 31, 2015 through December 30, 2016 | 6.75:1.00 | ||
December 31, 2016 through December 30, 2017 | 6.25:1.00 | ||
December 31, 2017 and thereafter | 6.00:1.00 |
Exhibit 31.1 | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
Exhibit 31.2 | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
Exhibit 32.1 | Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
Exhibit 32.2 | Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
Exhibit 101.INS | XBRL Instance Document | |
Exhibit 101.SCH | XBRL Extension Schema Document | |
Exhibit 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
Exhibit 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |
Exhibit 101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
Exhibit 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
November 3, 2016 | Advanced Disposal Services, Inc. | |||||
By: | /s/ Steven R. Carn | |||||
Steven R. Carn | ||||||
Chief Financial Officer |
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Nov. 01, 2016 |
|
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Advanced Disposal Services, Inc. | |
Entity Central Index Key | 0001585790 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 87,720,437 |
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 4.2 | $ 4.4 |
Accumulated depreciation property and equipment | 1,134.1 | 1,007.5 |
Accumulated amortization other intangible assets | $ 201.1 | $ 185.6 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 64,493,536 | 64,493,536 |
Common stock, shares outstanding (in shares) | 64,493,536 | 64,493,536 |
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ 3.8 | $ (5.5) | $ (10.3) | $ (24.8) |
Other comprehensive loss, net of tax | 0.0 | 0.0 | 0.0 | (1.5) |
Comprehensive income (loss) | $ 3.8 | $ (5.5) | $ (10.3) | $ (26.3) |
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - 9 months ended Sep. 30, 2016 - USD ($) $ in Millions |
Total |
Common Stock |
Additional Paid-In Capital |
Accumulated Deficit |
---|---|---|---|---|
Balance, Amount at Dec. 31, 2015 | $ 489.8 | $ 0.6 | $ 1,100.4 | $ (611.2) |
Balance, Shares at Dec. 31, 2015 | 64,493,536 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net loss | (10.3) | (10.3) | ||
Stock-based compensation expense | 4.0 | 4.0 | ||
Return of capital to parent company | (19.9) | (19.9) | ||
Balance, Amount at Sep. 30, 2016 | $ 463.6 | $ 0.6 | $ 1,084.5 | $ (621.5) |
Balance, Shares at Sep. 30, 2016 | 64,493,536 |
Business Operations |
9 Months Ended |
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Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Operations | Business Operations Advanced Disposal Services, Inc. (formerly ADS Waste Holdings Inc. hereafter referred to as "the Company") together with its consolidated subsidiaries, as a consolidated entity, is a nonhazardous solid waste services company providing collection, transfer, recycling and disposal services to customers in the South, Midwest and Eastern regions of the United States, as well as in the Commonwealth of the Bahamas. As of September 30, 2016, the Company was wholly owned by ADS Waste Holdings Corp. (the “Parent”). The Company manages and evaluates its principal operations through three reportable operating segments on a regional basis. Those operating segments are the South, East and Midwest regions which provide collection, transfer, recycling and disposal services. Additional information related to segments can be found in Note 9. Seven acquisitions were completed during the nine months ended September 30, 2016 for aggregate prices consisting of a cash purchase price of $5.2 and notes payable of $0.2, subject to net working capital adjustments and other commitments, which are expected to be completed within approximately one year. Seven acquisitions were completed during the nine months ended September 30, 2015 for a cash purchase price of $25.0 and notes payable of $3.3. The results of operations of each acquisition are included in the Company's condensed consolidated statements of operations subsequent to the closing date of each acquisition. The Company recorded an increase to the purchase price of prior year acquisitions during the nine months ended September 30, 2016 in the amount of $0.1. The Company is still reviewing information surrounding intangible assets and current liabilities related to acquisitions completed subsequent to September 30, 2015. |
Basis of Presentation |
9 Months Ended |
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Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s condensed consolidated financial statements include its wholly-owned subsidiaries of Advanced Disposal Services South, Inc. and HW Star Holdings Corp. and their respective subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The condensed consolidated financial statements as of September 30, 2016 and for the three and nine months ended September 30, 2016 and 2015 are unaudited. In the opinion of management, these condensed consolidated financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair statement of the balance sheet, results of operations, comprehensive loss, cash flows, and changes in equity for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The financial statements presented herein should be read in conjunction with the financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. In conformity with accounting principles generally accepted in the United States of America, the Company uses estimates and assumptions that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. The Company must make these estimates and assumptions because certain information that it uses is dependent on future events, cannot be calculated with a high degree of precision from data available or simply cannot be readily calculated based on generally accepted methodologies. In preparing the Company's financial statements, the more subjective areas that deal with the greatest amount of uncertainty relate to: accounting for long-lived assets, including recoverability; landfill development costs, final capping, closure and post-closure costs; valuation allowances for accounts receivable and deferred tax assets; liabilities for potential litigation; claims and assessments; liabilities for environmental remediation; stock compensation; accounting for goodwill and intangible asset impairments; deferred taxes; uncertain tax positions; self-insurance reserves; and estimates of the fair value of assets acquired and liabilities assumed in any acquisition. Actual results could differ materially from the estimates and assumptions that the Company uses in preparation of its financial statements. Recently Issued Accounting Standards In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-09, Compensation - Stock Compensation (Topic 718), which simplifies the accounting for employee stock-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The standard is effective for fiscal years beginning after December 31, 2016, including interim periods within those fiscal years. Early adoption is permitted. The Company expects to early adopt this guidance during the fourth quarter of fiscal 2016 and does not believe this standard will have a material impact on its financial condition, results of operations or liquidity. In February 2016, the FASB issued ASU 2016-02, Leases, which will require lessees to recognize most leases on their balance sheets as a right-of-use asset with a corresponding lease liability, and lessors to recognize a net lease investment. Additional qualitative and quantitative disclosures will also be required to increase transparency and comparability among organizations. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the standard is permitted, however; the Company does not expect to early adopt the ASU. Lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented. While the Company is still assessing the impact of this standard, it does not believe this standard will have a material impact on the Company's financial condition, results of operations or liquidity. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which supersedes previous revenue recognition guidance. The new standard requires that a company recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. Companies will need to use more judgment and estimates than under the guidance currently in effect, including estimating the amount of variable revenue to recognize over each identified performance obligation. Additional disclosures will be required to help users of financial statements understand the nature, amount and timing of revenue and cash flows arising from contracts. In July 2015, the FASB approved a one-year deferral of the effective date. This standard will now become effective for the Company beginning with the first quarter 2018 and can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. The Company anticipates adopting the standard as a cumulative effect adjustment as of the date of adoption. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements |
Landfill Liabilities |
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Asset Retirement Obligation Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Landfill Liabilities | Landfill Liabilities Liabilities for final closure and post-closure costs for the year ended December 31, 2015 and for the nine months ended September 30, 2016 are shown in the table below:
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Earnings Per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic earnings per share and earnings per share, assuming dilution:
Basic net income (loss) per share is based on the weighted-average number of shares of common stock outstanding for each of the periods presented. Net income (loss) per share, assuming dilution, is based on the weighted-average number of shares of common stock equivalents outstanding adjusted for the effects of common stock that may be issued as a result of potentially dilutive instruments. The Company's potentially dilutive instruments are made up of equity awards, which include stock options, restricted stock awards, and performance stock awards. The Earnings Per Share Topic in the FASB's Accounting Standards Codification ("ASC") requires the Company to include additional shares in the computation of net income per share, assuming dilution. The additional shares included in diluted net income per share represent the number of shares that would be issued if all of the above potentially dilutive instruments were converted into common stock. When calculating diluted net income per share, the ASC requires the Company to include the potential shares that would be outstanding if all outstanding stock options were exercised. This number is different from outstanding stock options because it is offset by shares the Company could repurchase using the proceeds from these hypothetical exercises to obtain the common stock equivalent. Approximately 1.4 million and 4.5 million of outstanding stock awards for the third quarter and nine months ended 2016, respectively, were excluded from the diluted earnings per share calculation because their effect was antidilutive. Approximately 3.8 million and 3.8 million of outstanding stock awards for the third quarter and nine months ended 2015, respectively, were excluded from the diluted earnings per share calculation because their effect was antidilutive. |
Debt |
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt The following table summarizes the major components of debt at each balance sheet date and provides the maturities and interest rate ranges of each major category of debt:
All borrowings under the Term Loan B and the Revolver are guaranteed by each of the Company's current and future U.S. subsidiaries (which also guarantee the Senior Notes), subject to certain agreed-upon exemptions. The Company has one non-guarantor foreign subsidiary as disclosed in Note 12. All guarantors are jointly and severally and fully and unconditionally liable. The Parent has no independent assets or operations and each subsidiary guarantor is 100% owned by the Company. There are no significant restrictions on the Company or any guarantor to obtain funds from its subsidiaries by dividend or loan. Refer to note 13 for subsequent event related to the Term Loan B and Revolver. Revolver and Letter of Credit Facilities As of September 30, 2016, the Company had an aggregate committed capacity of $300.0, of which $100.0 was available for letters of credit under its credit facilities. The Company’s Revolver is its primary source of letter of credit capacity and expires in October 2019. As of September 30, 2016 and December 31, 2015, the Company had $0.0 and $32.0 of borrowings outstanding on the Revolver, respectively. As of September 30, 2016 and December 31, 2015, the Company had an aggregate of $44.6 and $45.9, respectively, of letters of credit outstanding under its credit facilities. Refer to note 13 for subsequent event related to the Revolver. |
Derivative Instruments and Hedging Activities |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The following table summarizes the fair values of derivative instruments recorded in the Company’s condensed consolidated balance sheets:
The Company has not offset fair value of assets and liabilities recognized for its derivative instruments. Interest Rate Caps In December 2012, the Company entered into four interest rate cap agreements to hedge the risk of a rise in interest rates and associated cash flows on its variable rate debt. The Company recorded a premium of $5.0 in other assets in the condensed consolidated balance sheets and amortized the premium to interest expense based upon decreases in time value of the caps. Amortization expense was approximately $0.0 and $0.4 for the three months ending September 30, 2016 and 2015, respectively and for the nine months ended September 30, 2016 and 2015 was $0.3 and $1.5, respectively. The contracts expired in September 2016. In May 2016, the Company entered into three interest rate cap agreements as economic hedges against the risk of a rise in interest rates and the associated cash flows on its variable rate debt. The Company will pay the $5.5 premium of the caps equally over eleven quarters beginning on March 31, 2017. The Company elected not to apply hedge accounting to these interest rate caps therefore changes in the fair value of the interest rate caps are recorded in other income (expense), net in the condensed consolidated statements of operations. The Company recorded a gain of $0.3 for the three months ended September 30, 2016 and a loss of $2.6 for the nine months ended September 30, 2016. The notional value of the contracts aggregated were $800.0 as of September 30, 2016 and will remain constant through maturity in September 2019. Commodity Futures Contracts The Company utilizes fuel derivative instruments (commodity futures contracts) as economic hedges of the risk that fuel prices will fluctuate. The Company has used financial derivative instruments for both short-term and long-term time frames and utilizes fixed price swap agreements to manage the identified risk. The Company does not enter into derivative financial instruments for trading or speculative purposes. Changes in the fair value and settlements of the fuel derivative instruments are recorded in other income (expense), net in the condensed consolidated statements of operations. The Company recorded losses of $0.3 and $9.3 for the three months ended September 30, 2016 and 2015, respectively and for the nine months ended September 30, 2016 and 2015 the Company recorded gains of $1.2 and losses of $9.5, respectively. As of September 30, 2016, the Company has 3.4 gallons under fixed price derivative contracts with strike prices ranging from $2.20 to $2.64 per gallon. If the mean price of the high and the low exceeds the contract price per gallon, the Company receives the difference between the average price and the contract price (multiplied by the notional gallons) from the counterparty. If the mean average price is less than the contract price per gallon, the Company pays the difference to the counterparty. |
Income Taxes |
9 Months Ended |
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Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s effective income tax rate for the three months ended September 30, 2016 and 2015 was 36.7% and 46.1%, respectively. The Company evaluates its effective income tax rate at each interim period and adjust it accordingly as facts and circumstances warrant. The difference between income taxes computed at the federal statutory rate of 35% and reported income taxes for the three months ended September 30, 2016 was primarily due to the unfavorable impacts of permanently non-deductible expenses, interest related to previously recorded uncertain tax positions and the change in recorded valuation allowances. The difference between income taxes computed at the federal statutory rate of 35% and reported income taxes for the three months ended September 30, 2015 was primarily due to a change in forecasted book income, as well as a mix of income in the states in which the Company operates. The Company’s effective income tax rate for the nine months ended September 30, 2016 and 2015 was 21.4% and 35.8%, respectively. The difference between income taxes computed at the federal statutory rate of 35% and reported income taxes for the nine months ended September 30, 2016 was primarily due to the unfavorable impact of permanently non-deductible expenses and the unfavorable impact of the change in recorded valuation allowance. The difference between income taxes computed at the federal statutory rate of 35% and reported income taxes for the nine months ended September 30, 2015 was primarily due to the unfavorable impact of the change in recorded valuation allowances and the mix of income in the states in which the Company operates. As of September 30, 2016, the Company had $10.3 of liabilities associated with unrecognized tax benefits and related interest. These liabilities are primarily included as a component of long-term “Other liabilities” in the condensed consolidated balance sheet because the Company generally does not anticipate that settlement of the liabilities will require payment of cash within the next 12 months. The Company is not able to reasonably estimate when it would make any cash payments required to settle these liabilities, but it does not believe that the ultimate settlement of the obligations will materially affect our liquidity. |
Commitments and Contingencies |
9 Months Ended |
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Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Financial Instruments The Company has obtained letters of credit, performance bonds and insurance policies for the performance of landfill final capping, closure and post-closure requirements, environmental remediation, and other obligations. Letters of credit are supported by the Company’s Revolver (Note 5). The Company does not expect that any claims against or draws on these instruments would have a material adverse effect on the Company’s condensed consolidated financial statements. The Company has not experienced any unmanageable difficulty in obtaining the required financial assurance instruments for its current operations. In an ongoing effort to mitigate risks of future cost increases and reductions in available capacity, the Company continues to evaluate various options to access cost-effective sources of financial assurance. Insurance The Company carries insurance coverage for protection of its assets and operations from certain risks including automobile liability, general liability, real and personal property, workers compensation, directors and officers liability, pollution, legal liability and other coverages the Company believes are customary to the industry. The Company's exposure to loss for insurance claims is generally limited to the per incident deductible, or self-insured retention, under the related insurance policy. Its exposure, however, could increase if its insurers are unable to meet their commitments on a timely basis. The Company has retained a significant portion of the risks related to its automobile, general liability, workers compensation and health claims programs. For its self-insured retentions, the exposure for unpaid claims and associated expenses, including incurred but not reported losses, is based on an actuarial valuation and internal estimates. The accruals for these liabilities could be revised if future occurrences or loss development significantly differ from the Company's assumptions used. The Company does not expect the impact of any known casualty, property, environmental or other contingency to have a material impact on its financial condition, results of operations or cash flows. Litigation and Other Matters In February 2009, the Company and certain of its subsidiaries were named as defendants in a purported class action suit in the Circuit Court of Macon County, Alabama. Similar class action complaints were brought against the Company and certain of its subsidiaries in 2011 in Duval County, Florida and in 2013 in Quitman County, Georgia and Barbour County, Alabama, and in 2014 in Chester County, Pennsylvania. The 2013 Georgia complaint was dismissed in March 2014. In late 2015 in Gwinnett County, Georgia, another purported class action suit was filed. The plaintiffs in those cases primarily allege that the defendants charged improper fees (fuel, administrative and environmental fees) that were in breach of the plaintiffs' service agreements with the Company and seek damages in an unspecified amount. The Company believes that it has meritorious defenses against these purported class actions, which it will vigorously pursue. Given the inherent uncertainties of litigation, including the early stage of these cases, the unknown size of any potential class, and legal and factual issues in dispute, the outcome of these cases cannot be predicted and a range of loss, if any, cannot currently be estimated. In November 2014, the Attorney General of the State of Vermont filed a complaint against the Company relating to the Moretown, Vermont landfill regarding alleged odor and other environmental-related noncompliances with environmental laws and regulations and environmental permits. In the complaint, the Attorney General requested that the State of Vermont Superior Court find the Company liable for the alleged noncompliances, issue related civil penalties, and order the Company to reimburse the State of Vermont for enforcement costs. While the complaint does not specify a monetary penalty, prior correspondence from the Attorney General of the State of Vermont indicates that it may seek a penalty relating to the alleged noncompliances that is not expected to be material. Given the inherent uncertainties of litigation, including the early stage of this case, the outcome cannot be predicted and a range of loss, if any, cannot currently be estimated. The Company is subject to various other proceedings, lawsuits, disputes and claims and regulatory investigations arising in the ordinary course of its business. Many of these actions raise complex factual and legal issues and are subject to uncertainties. Actions filed against the Company include commercial, customer, and employment-related claims. The plaintiffs in some actions seek unspecified damages or injunctive relief, or both. These actions are in various procedural stages, and some are covered in part by insurance. Although the Company cannot predict the ultimate outcome and the range of loss cannot be currently estimated, the Company does not believe that the eventual outcome of any such action could have a material adverse effect on its business, financial condition, results of operations, or cash flows. Multiemployer Defined Benefit Pension Plans Approximately 13.6% of the Company’s workforce is covered by collective bargaining agreements with various local unions across its operating regions. As a result of some of these agreements, certain of the Company’s subsidiaries are participating employers in a number of trustee-managed multiemployer, defined benefit pension plans for the affected employees. In connection with its ongoing renegotiation of various collective bargaining agreements, the Company may discuss and negotiate for the complete or partial withdrawal from one or more of these pension plans. A complete or partial withdrawal from a multiemployer pension plan may also occur if employees covered by a collective bargaining agreement vote to decertify a union from continuing to represent them. The Company is not aware of any such actions in connection with continuing operations. As a result of certain discontinued operations, the Company is potentially exposed to certain withdrawal liabilities. The Company does not believe that any future withdrawals, individually or in the aggregate, from the multiemployer plans to which it contributes could have a material adverse effect on the Company's business, financial condition or liquidity. However, such withdrawals could have a material adverse effect on the Company's results of operations for a particular reporting period, depending on the number of employees withdrawn in any future period and the financial condition of the multiemployer plan(s) at the time of such withdrawal(s). Tax Matters The Company has open tax years dating back to 2000 in certain jurisdictions. Prior to the acquisition, MW Star Holdings, Corp. (Veolia ES Solid Waste division) was part of a consolidated group and is still subject to IRS and state examinations dating back to 2004. Pursuant to the terms of the acquisition of Veolia ES Solid Waste, Inc., the Company is entitled to certain indemnifications for Veolia ES Solid Waste Division's pre-acquisition tax liabilities. The Company maintains a liability for uncertain tax positions, the balance of which management believes is adequate. Results of audit assessments by taxing authorities are not currently expected to have a material adverse impact on the Company's results of operations or cash flows. |
Segment and Related Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment and Related Information | Segment and Related Information The Company manages and evaluates its operations primarily through its South, East and Midwest regional segments. These three groups are presented below as the Company’s reportable segments. The Company’s three geographic operating segments provide collection, transfer, disposal and recycling services. The Company serves residential, commercial and industrial, and municipal customers throughout its operating regions. Summarized financial information concerning its reportable segments for the three and nine months ended September 30, 2016 and 2015 are shown in the table below:
Fluctuations in the Company's operating results may be caused by many factors, including period-to-period changes in the relative contribution of revenue by each line of business and operating segment and by general economic conditions. In addition, its revenues and income from operations typically reflect seasonal patterns. The Company expects its operating results to vary seasonally, with revenues typically lowest in the first quarter, higher in the second and third quarters and lower in the fourth quarter than in the second and third quarters. This seasonality reflects the lower volume of solid waste generated during the late fall, winter and early spring in the East and Midwest segments because of decreased construction and demolition activities during winter months in these regions of the United States. In addition, some of the Company's operating costs may be higher in the winter months. Adverse winter weather conditions slow waste collection activities, resulting in higher labor and operational costs. Greater precipitation in the winter increases the weight of collected municipal solid waste, resulting in higher disposal costs, which are calculated on a per ton basis. Additionally, certain destructive weather conditions that tend to occur during the second half of the year, such as hurricanes that most often impact the South region, can increase the Company’s revenues in the areas affected. While weather-related and other occurrences can boost revenues through additional work, as a result of significant start-up costs and other factors, such revenue sometimes generates earnings at comparatively lower margins. Certain weather conditions, including severe winter storms, may result in the temporary suspension of the Company’s operations, which can significantly affect the operating results of the affected regions. No such events have occurred during the periods presented. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements Assets and Liabilities Accounted for at Fair Value In measuring fair values of assets and liabilities, the Company uses valuation techniques that maximize the use of observable inputs (Level 1) and minimize the use of unobservable inputs (Level 3). The Company also uses market data or assumptions that it believes market participants would use in pricing an asset or liability, including assumptions about risk when appropriate. The carrying value for certain of the Company's financial instruments approximate fair value because of their short-term nature. The Company’s assets and liabilities that are measured at fair value on a recurring basis include the following:
The fair values of the fuel derivative instruments and interest rate caps are determined using standard option valuation models with assumptions about commodity prices and interest rates based on those observed in underlying markets (Level 2 in fair value hierarchy). Fair Value of Debt The fair value of the Company’s debt (Level 2) is estimated using indirectly observable market inputs, except for the Revolver for which cost approximates fair value due to the short-term nature of the interest rate. Although the Company has determined the estimated fair value amounts using quoted market prices, considerable judgment is required in interpreting the information and in developing the estimated fair values. Therefore, these estimates are not necessarily indicative of the amounts that the Company, or holders of the instruments, could realize in a current market exchange. The fair value estimates are based on information available as of September 30, 2016 and December 31, 2015, respectively. The estimated fair value of the Company’s debt is as follows:
The carrying value of the Company’s debt at September 30, 2016 and December 31, 2015 was $2,235.5 and $2,267.5, respectively. |
Stock-based Compensation |
9 Months Ended |
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Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-based Compensation Amendment to Stock Incentive Plan During the nine months ended September 30, 2016, the Board of Directors of the Parent amended the Advanced Disposal Waste Holdings Corp. 2012 Stock Incentive Plan (the 2012 Plan) to allow for the grant of performance shares, restricted shares, restricted share units, and other equity awards in addition to stock options and stock purchase rights as originally provided for under the 2012 Plan. Named Executive Officer (NEO) Grants During the nine months ended September 30, 2016, there were 30,384 NEO restricted stock grants under the 2012 Plan with a fair value of $24.28 per share. The restricted stock will vest in three equal installments over each of the first three anniversaries of the date of the grant. For the nine months ended September 30, 2016, none of the NEO restricted stock was forfeited. As of September 30, 2016, there were 30,384 shares of restricted stock outstanding under the 2012 Plan. During the nine months ended September 30, 2016, there were 60,767 NEO performance share units (PSUs) issued under the 2012 Plan with a fair value of $24.28 per share. The PSUs will vest in full on the third anniversary of the date of the grant. The PSUs shall be measured based on the Parent's budget and are weighted as follows: EBITDA: 50%; Free Cash Flow: 30%; and Revenue: 20%. The measurement criteria begins with an attainment of 90% of the budget which results in vesting of 25% of the shares underlying the PSUs granted and ends with an attainment of 110% of the budget which results in vesting of 175% of the shares underlying the PSUs granted. Performance will be measured separately for each of the three years in the performance period and the total number of PSUs earned at the conclusion of the three three year performance period will be the sum of the PSUs earned with respect to each individual year. For the nine months ended September 30, 2016, none of the NEO PSUs were forfeited. As of September 30, 2016, there were 60,767 PSUs outstanding under the 2012 Plan. During the nine months ended September 30, 2016, there were 96,922 NEO option grants under the 2012 Plan. The options will vest in three equal installments over each of the first three anniversaries of the date of the grant. For the nine months ended September 30, 2016, none of these NEO options were forfeited or exercised. As of September 30, 2016, there were 96,922 options outstanding under the NEO plan. The weighted average exercise price of outstanding NEO options was $24.28. The weighted average remaining contractual term for the outstanding NEO options was 9.75 years as of September 30, 2016. During the nine months ended September 30, 2016, the Company and its Chief Executive Officer (CEO), entered into an amendment to the CEO's employment agreement. The amendment adjusts the performance criteria applicable to performance-based stock options that the CEO is eligible to earn with respect to 2016. Previously, the only applicable criterion was EBITDA; the amendment provides that the number of performance-based stock options earned will be based on EBITDA (50%) and free cash flow (50%). The amendment also clarifies that the full potential grant of performance-based stock options (covering up to 190,792 shares of Parent's common stock) is still available to be earned by the CEO. Total unrecognized compensation expense for all of the above NEO grants (including the impact of the amendment to the CEO performance-based stock options) was approximately $3.6 as of September 30, 2016, which will be recognized over the next 3.3 years. For the three and nine months ended September 30, 2016, compensation expense for all of the above NEO grants (including the impact of the amendment to the CEO performance-based stock options) was approximately $0.3. Annual Stock Option Grants During the nine months ended September 30, 2016, there were 555,969 annual grants under the 2012 Plan for employees other than the NEO's. Each option had an estimated fair value of $7.35 per option on the date of grant. The options will vest 20% on date of grant and 20% in four equal installments over each of the first four anniversaries of the date of the grant. The weighted average exercise price of these options was $24.28. The weighted average remaining contractual term for these options was 9.6 years as of September 30, 2016. |
Guarantor Financial Statements |
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Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Financial Statements | Guarantor Financial Statements All borrowings under the Term Loan B and the Revolver are guaranteed by each of the Company's current and future U.S. subsidiaries (which also guarantee the Senior Notes), subject to certain agreed-upon exemptions. The Company has one non-guarantor foreign subsidiary, Sanitation Services Company Limited, which exceeded 3% of pretax income for the three and nine months ended September 30, 2016. As a result, the Company is providing the following condensed consolidating financial information in accordance with SEC disclosure requirements. Prior periods are not presented as the non guarantor subsidiary was minor. Condensed Consolidated Balance Sheet as of September 30, 2016
Condensed Consolidated Statement of Operations for the three months ended September 30, 2016
Condensed Consolidated Statement of Operations for the nine months ended September 30, 2016
Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2016
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Subsequent Events |
9 Months Ended |
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Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Initial Public Offering (IPO) The Company closed its IPO on October 12, 2016 in which it sold 19,250,000 shares of common stock to new shareholders at $18 per share and received net proceeds of $325.1 after underwriting fees, commissions and expenses. Stock Split In connection with the IPO, the Company effected a stock split and recapitalization and issued 64,493,536 shares of common stock directly to existing shareholders. All share and per share amounts in these financial statements and related notes have been retrospectively adjusted to give effect to the stock split. Use of Proceeds from IPO The Company received proceeds in connection with the IPO, after underwriting fees and commissions, of $326.6 and before expenses of $1.5, and used these proceeds to make an early prepayment on the Term Loan B of $326.0. In connection with this early prepayment of debt, the Company will recognize a loss on extinguishment of $7.5 in the fourth quarter. Adoption of 2016 Omnibus Equity Plan The Company's board of directors adopted the Advanced Disposal Services, Inc. 2016 Omnibus Equity Plan on January 29, 2016. The 2016 Plan became effective on October 4, 2016 and will terminate on the tenth anniversary of the 2016 Plan effective date, unless sooner terminated by the Company's board of directors. Stock Awards Granted at IPO In connection with the IPO, the Company issued 659,899 stock options and 300,001 restricted stock units with a fair value of $9.3 to the NEOs of the Company which will be recognized in expense over the vesting period. These awards are scheduled to vest in full on the third anniversary of the date of grant. The restricted stock units were valued at $18 per share, which was the fair value of the Company’s stock on the grant date. The exercise price of the stock options is $18 per share, which was equal to the fair market value of the Company’s stock on the grant date. The contractual term of the options is ten years and each option had an estimated fair value of $5.91 per option on the date of grant. In connection with the IPO, 5,556 shares of restricted stock were issued to a non-employee director with a value of $0.1. This award is scheduled to vest in full on the third anniversary of the date of grant. The restricted stock was valued at $18 per share, which was the fair value of the Company’s stock on the grant date. In connection with the IPO, the Company issued 58,103 stock options with a fair value of $0.3 to employees other than the NEO’s, which will be expensed over the vesting period. These awards vest 20% on the date of grant and 20% on each of the first four anniversaries of the date of grant. The exercise price of the stock options is $18 per share, which was equal to the fair market value of the Company’s stock on the grant date. The contractual term of the options is 10 years and each option had an estimated fair value of $5.80 per option on the date of grant. Stock Options Exercised Subsequent to September 30, 2016, 1,090,816 stock options have been exercised with the Company receiving proceeds of $10.4. Amendment to the Senior Secured Credit Agreement Upon IPO The remaining $20.0 of commitments under the revolving credit facility were extended to October 2019 upon consummation of the Company’s initial public offering on October 12, 2016. Underwriters' Option in IPO The underwriters have exercised their option to purchase an additional 2,887,500 shares from the Company, at the initial public offering price, less the underwriting discounts and commissions. |
Basis of Presentation (Policies) |
9 Months Ended |
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Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation | The Company’s condensed consolidated financial statements include its wholly-owned subsidiaries of Advanced Disposal Services South, Inc. and HW Star Holdings Corp. and their respective subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of estimates and assumptions | In conformity with accounting principles generally accepted in the United States of America, the Company uses estimates and assumptions that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. The Company must make these estimates and assumptions because certain information that it uses is dependent on future events, cannot be calculated with a high degree of precision from data available or simply cannot be readily calculated based on generally accepted methodologies. In preparing the Company's financial statements, the more subjective areas that deal with the greatest amount of uncertainty relate to: accounting for long-lived assets, including recoverability; landfill development costs, final capping, closure and post-closure costs; valuation allowances for accounts receivable and deferred tax assets; liabilities for potential litigation; claims and assessments; liabilities for environmental remediation; stock compensation; accounting for goodwill and intangible asset impairments; deferred taxes; uncertain tax positions; self-insurance reserves; and estimates of the fair value of assets acquired and liabilities assumed in any acquisition. Actual results could differ materially from the estimates and assumptions that the Company uses in preparation of its financial statements. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-09, Compensation - Stock Compensation (Topic 718), which simplifies the accounting for employee stock-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The standard is effective for fiscal years beginning after December 31, 2016, including interim periods within those fiscal years. Early adoption is permitted. The Company expects to early adopt this guidance during the fourth quarter of fiscal 2016 and does not believe this standard will have a material impact on its financial condition, results of operations or liquidity. In February 2016, the FASB issued ASU 2016-02, Leases, which will require lessees to recognize most leases on their balance sheets as a right-of-use asset with a corresponding lease liability, and lessors to recognize a net lease investment. Additional qualitative and quantitative disclosures will also be required to increase transparency and comparability among organizations. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the standard is permitted, however; the Company does not expect to early adopt the ASU. Lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented. While the Company is still assessing the impact of this standard, it does not believe this standard will have a material impact on the Company's financial condition, results of operations or liquidity. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which supersedes previous revenue recognition guidance. The new standard requires that a company recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. Companies will need to use more judgment and estimates than under the guidance currently in effect, including estimating the amount of variable revenue to recognize over each identified performance obligation. Additional disclosures will be required to help users of financial statements understand the nature, amount and timing of revenue and cash flows arising from contracts. In July 2015, the FASB approved a one-year deferral of the effective date. This standard will now become effective for the Company beginning with the first quarter 2018 and can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. The Company anticipates adopting the standard as a cumulative effect adjustment as of the date of adoption. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements |
Landfill Liabilities (Tables) |
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Asset Retirement Obligation Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Liabilities for Final Closure and Post-Closure Costs | Liabilities for final closure and post-closure costs for the year ended December 31, 2015 and for the nine months ended September 30, 2016 are shown in the table below:
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Earnings Per Share (Tables) |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Basic Earnings Per Share and Earnings Per Share, Assuming Dilution | The following table sets forth the computation of basic earnings per share and earnings per share, assuming dilution:
|
Debt (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Major Components of Debt | The following table summarizes the major components of debt at each balance sheet date and provides the maturities and interest rate ranges of each major category of debt:
|
Derivative Instruments and Hedging Activities (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Fair Values of Derivative Instruments Recorded in Condensed Consolidated Balance Sheets | The following table summarizes the fair values of derivative instruments recorded in the Company’s condensed consolidated balance sheets:
|
Segment and Related Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Financial Information Concerning Reportable Segments | Summarized financial information concerning its reportable segments for the three and nine months ended September 30, 2016 and 2015 are shown in the table below:
|
Fair Value Measurements (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Liabilities Measured at Fair Value on Recurring Basis | The Company’s assets and liabilities that are measured at fair value on a recurring basis include the following:
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Estimated Fair Value of Company's Debt | The estimated fair value of the Company’s debt is as follows:
|
Guarantor Financial Statements Guarantor Financial Statements (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidated Balance Sheet | Condensed Consolidated Balance Sheet as of September 30, 2016
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Condensed Consolidated Statement of Operations | Condensed Consolidated Statement of Operations for the three months ended September 30, 2016
Condensed Consolidated Statement of Operations for the nine months ended September 30, 2016
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Condensed Consolidated Cash Flow | Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2016
|
Business Operations (Details) $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 30, 2016
USD ($)
Segment
acquisition
|
Sep. 30, 2015
USD ($)
acquisition
|
|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of reportable operating segments | Segment | 3 | |
Number of acquisitions completed | acquisition | 7 | 7 |
Consideration transferred, cash | $ 5.2 | $ 25.0 |
Consideration transferred, notes payable | 0.2 | $ 3.3 |
Reduction to purchase price of prior year acquisitions | $ (0.1) |
Landfill Liabilities - Summary of Liabilities for Final Closure and Post-Closure Costs (Details) - USD ($) $ in Millions |
9 Months Ended | 12 Months Ended | |
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Dec. 31, 2015 |
|
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |||
Beginning balance | $ 193.7 | $ 201.1 | $ 201.1 |
Increase in retirement obligation | 7.1 | 9.8 | |
Accretion of closure and post-closure costs | 9.8 | $ 10.0 | 13.1 |
Disposition | (3.2) | ||
Change in estimate | (2.9) | ||
Costs incurred | (10.5) | (24.2) | |
Ending balance | 200.1 | $ 193.7 | |
Less: Current portion | (30.9) | ||
Noncurrent portion | $ 169.2 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Numerator: | ||||
Net income (loss) | $ 3.8 | $ (5.5) | $ (10.3) | $ (24.8) |
Denominator: | ||||
Average common shares outstanding (in shares) | 64,493,536 | 64,493,536 | 64,493,536 | 64,493,536 |
Other potentially dilutive common shares (in shares) | 448,964 | 0 | 0 | 0 |
Average common shares outstanding, assuming dilution (in shares) | 64,942,500 | 64,493,536 | 64,493,536 | 64,493,536 |
Net income (loss) per share, basic (in dollars per share) | $ 0.06 | $ (0.09) | $ (0.16) | $ (0.38) |
Net income (loss) per share, assuming dilution (in dollars per share) | $ 0.06 | $ (0.09) | $ (0.16) | $ (0.38) |
Stock Option | ||||
Denominator: | ||||
Other potentially dilutive common shares (in shares) | 1,400,000 | 3,800,000 | 4,500,000 | 3,800,000 |
Debt - Summary of Major Components of Debt - Principal (Details) - USD ($) $ in Millions |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Debt Instrument [Line Items] | ||
Capital lease obligations, maturing through 2024 | $ 42.8 | $ 28.2 |
Other debt | 15.3 | 20.0 |
Long-term debt, gross | 2,293.6 | 2,315.7 |
Less: Original issue discount | (55.7) | (68.6) |
Less: Current portion | (34.9) | (49.1) |
Long-term debt, less original issue discount and current maturities | 2,203.0 | 2,198.0 |
Revolver | ||
Debt Instrument [Line Items] | ||
Long-term debt | 0.0 | 32.0 |
Term Loan B | ||
Debt Instrument [Line Items] | ||
Long-term debt | 1,685.5 | 1,685.5 |
Senior Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 550.0 | $ 550.0 |
Debt - Summary of Major Components of Debt - Interest Rates (Details) - USD ($) $ in Millions |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2016 |
Dec. 31, 2015 |
|
Revolver | ||
Debt Instrument [Line Items] | ||
Line of Credit Facility, Interest Rate at Period End | 5.51% | 6.30% |
Term Loan B | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Periodic Payment, Principal | $ 4.5 | $ 4.5 |
Term Loan B | LIBOR | ||
Debt Instrument [Line Items] | ||
Reference rate | 0.75% | 0.75% |
Basis spread on variable rate | 3.00% | 3.00% |
Senior Notes | ||
Debt Instrument [Line Items] | ||
Debt interest rate | 8.25% | 8.25% |
Debt - Additional Information (Details) |
9 Months Ended | |
---|---|---|
Sep. 30, 2016
USD ($)
subsidiary
|
Dec. 31, 2015
USD ($)
|
|
Debt Instrument [Line Items] | ||
Number of non-guarantor foreign subsidiary | subsidiary | 1 | |
Percentage of parent company in subsidiary guarantor | 100.00% | |
Letters of credit outstanding | $ 44,600,000 | $ 45,900,000 |
Revolver | ||
Debt Instrument [Line Items] | ||
Long-term debt | 0 | $ 32,000,000 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Line of credit maximum borrowing capacity | 300,000,000.0 | |
Letters of Credit | ||
Debt Instrument [Line Items] | ||
Line of credit maximum borrowing capacity | $ 100,000,000.0 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate continuing operations | 36.70% | 46.10% | 21.40% | 35.80% |
Federal statutory tax rate | 35.00% | 35.00% | 35.00% | 35.00% |
Unrecognized tax benefits and related interest | $ 10.3 | $ 10.3 |
Commitments and Contingencies (Details) |
Sep. 30, 2016 |
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
Percentage of workforce covered under collective bargaining | 13.60% |
Segment and Related Information - Additional Information (Details) |
9 Months Ended |
---|---|
Sep. 30, 2016
Segment
| |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Number of geographic operating segments | 3 |
Fair Value Measurements - Estimated Fair Value of Company's Debt (Details) - USD ($) $ in Millions |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Debt Instrument [Line Items] | ||
Debt instruments carrying value | $ 2,235.5 | $ 2,267.5 |
Level 2 | ||
Debt Instrument [Line Items] | ||
Estimated fair value debt | 2,267.2 | 2,226.7 |
Level 2 | Revolver | ||
Debt Instrument [Line Items] | ||
Estimated fair value debt | 0.0 | 32.0 |
Level 2 | Senior Notes | ||
Debt Instrument [Line Items] | ||
Estimated fair value debt | 577.5 | 555.5 |
Level 2 | Term Loan B | ||
Debt Instrument [Line Items] | ||
Estimated fair value debt | $ 1,689.7 | $ 1,639.2 |
Guarantor Financial Statements Guarantor Financial Statements (Details) |
9 Months Ended |
---|---|
Sep. 30, 2016
subsidiary
| |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Number of non-guarantor foreign subsidiary | 1 |
Percent of non-guarantor subsidiary to pretax income (as percent) | 3.00% |
Subsequent Events - Debt Refinancing (Details) - USD ($) $ in Millions |
Nov. 10, 2016 |
Oct. 21, 2016 |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|---|---|
Senior Notes | ||||
Subsequent Event [Line Items] | ||||
Long-term debt | $ 550.0 | $ 550.0 | ||
Debt interest rate | 8.25% | 8.25% | ||
Scenario, Forecast | ||||
Subsequent Event [Line Items] | ||||
Long-term debt | $ 425.0 | |||
Scenario, Forecast | Senior Notes | ||||
Subsequent Event [Line Items] | ||||
Debt interest rate | 5.63% | |||
Scenario, Forecast | Senior Notes | ||||
Subsequent Event [Line Items] | ||||
Debt interest rate | 8.25% | |||
Early repayment of senior debt | $ 550.0 | |||
Subsequent Event | Senior Secured Credit Facility | ||||
Subsequent Event [Line Items] | ||||
Long-term debt | $ 1,800.0 | |||
Subsequent Event | Senior Secured Credit Facility | Senior Secured Credit Facility | ||||
Subsequent Event [Line Items] | ||||
Long-term debt | $ 1,500.0 | |||
Debt instrument term | 7 years | |||
Subsequent Event | Senior Secured Credit Facility | Senior Secured First Lien Revolving Credit Facility | ||||
Subsequent Event [Line Items] | ||||
Long-term debt | $ 300.0 | |||
Debt instrument term | 5 years |
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