Casella Waste Systems Inc (CWST) Reports Solid Revenue Growth Amidst Net Loss in Q4
Revenue Growth: Q4 revenues surged by 32.1% to $359.6 million, and annual revenues climbed 16.5% to $1.265 billion.
Net Income: Q4 saw a net loss of $(1.8) million, while fiscal year net income totaled $25.4 million, a decrease from the previous year.
Adjusted EBITDA: Q4 Adjusted EBITDA rose by 46.1% to $82.2 million, with the fiscal year reaching $294.6 million, a 20.1% increase.
Adjusted Free Cash Flow: Increased by 15.4% to $128.3 million for the fiscal year.
Acquisitions: CWST acquired seven businesses with an annualized revenue of approximately $315 million.
FY 2024 Guidance: Revenue is projected between $1.480 billion and $1.510 billion, with net income expected to be between $35 million and $45 million.
On February 15, 2024, Casella Waste Systems Inc (NASDAQ:CWST) released its 8-K filing, announcing the financial results for the fourth quarter and fiscal year 2023, along with providing fiscal year 2024 guidance. Casella Waste Systems Inc, a regional solid waste, recycling, and resource management services company, operates primarily in the Northeastern United States, offering a range of services including Recycling, Collection, Organics, Energy, Landfills, Special Waste, and Professional Services.
Despite a net loss of $(1.8) million in Q4, the company's revenue for the quarter increased significantly to $359.6 million, up by 32.1% compared to the same period in 2022. For the fiscal year 2023, revenues were $1.265 billion, marking a 16.5% increase from the previous year. The solid waste pricing growth, driven by collection and disposal price increases, contributed to the revenue surge.
Adjusted EBITDA for Q4 showed a substantial rise of 46.1% to $82.2 million, while the fiscal year's Adjusted EBITDA reached $294.6 million, a 20.1% increase from fiscal year 2022. This growth reflects the company's successful execution of its operating initiatives and strategic acquisitions. Adjusted Free Cash Flow also saw an uptick, increasing by 15.4% to $128.3 million for the fiscal year.
The company's financial achievements, particularly in Adjusted EBITDA and Adjusted Free Cash Flow, underscore its ability to grow and manage costs effectively in the competitive waste management industry. These metrics are crucial as they indicate the company's operational efficiency and its capacity to generate cash for reinvestment or debt reduction.
Casella Waste Systems Inc's net income for the fiscal year was $25.4 million, a decrease from the previous year's $53.1 million. This decline was influenced by several factors, including higher depreciation and amortization expenses due to acquisition growth, expenses from acquisition activities, and a charge related to a landfill capping veneer failure.
For fiscal year 2024, Casella Waste Systems Inc anticipates continued growth, projecting revenues between $1.480 billion and $1.510 billion, and net income between $35 million and $45 million. Adjusted EBITDA is expected to be between $350 million and $360 million, with Adjusted Free Cash Flow ranging from $140 million to $150 million.
The company's outlook for 2024 is based on a stable economic environment but takes a cautious approach to construction and demolition volumes. The guidance includes revenue growth from acquisitions made in 2023 and anticipates further margin expansion through operational and pricing strategies.
Casella Waste Systems Inc's balance sheet as of December 31, 2023, shows a strong position with $220.9 million in cash and cash equivalents. The company's total assets amounted to $2.535 billion, with total liabilities of $1.513 billion, resulting in a stockholders' equity of $1.021 billion.
The company's performance in fiscal year 2023, despite the net loss in Q4, demonstrates resilience and strategic growth through acquisitions. With a robust pipeline and a focus on operational efficiency, Casella Waste Systems Inc is well-positioned for continued success in the waste management industry.
For more detailed financial information and future updates, investors and interested parties are encouraged to visit Casella Waste Systems Inc's website or contact their investor relations team.
Explore the complete 8-K earnings release (here) from Casella Waste Systems Inc for further details.
This article first appeared on GuruFocus.
