Republic Services (RSG) Q3 Earnings Beat Estimates, Rise Y/Y
Republic Services, Inc. RSG reported impressive third-quarter 2022 results, with earnings and revenues surpassing the Zacks Consensus Estimate.
Adjusted earnings (excluding 2 cents from non-recurring items) per share of $1.34 outpaced the consensus mark by 10.7% and improved 20.7% year over year.
Republic Services' average recycled-commodity price per ton sold in the third quarter was $162, down $56 on a sequential basis and $68 year over year.
So far this year, shares of Republic Services have gained 1.4% against an 11.5% decline of the industry it belongs to.
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Revenues
Quarterly revenues of $3.6 billion surpassed the consensus estimate by 1.9% and increased 22.6% year over year. RSG’s top line includes a favorable impact of 10.2% from internal growth and 12.4% from acquisitions/divestitures.
Republic Services, Inc. Price, Consensus and EPS Surprise
Republic Services, Inc. price-consensus-eps-surprise-chart | Republic Services, Inc. Quote
Revenues in the Collection segment totaled $2.43 billion, up 14.1% year over year. Revenues in the Transfer segment (net) amounted to $189.3 million, rising 3.6% year over year. Revenues in the Landfill segment (net) totaled $412.2 million, increasing 10.2% year over year. Environmental solutions segment’s revenues (net) of $397.2 million surged more than 100% year over year. Other segment’s revenues of $172.3 million increased 10.4% year over year.
Operating Results
Adjusted EBITDA margin of 29.2% declined 130 basis points (bps) from the prior-year quarter’s levels.
Operating income was $664.3 million, up 17.7% from the year-ago quarter’s levels. The operating income margin declined to 18.5% from the year-ago quarter’s figure.
Total selling, general and administrative expenses were $362.8 million, up 21% from the year-ago quarter’s figure.
Balance Sheet and Cash Flow
Republic Services exited third-quarter 2022 with cash and cash equivalents of $81.4 million compared with $119.4 million at the end of the prior quarter.
Long-term debt (net of current maturities) was $11.2 billion compared with $11.6 billion at the end of the prior quarter.
RSG generated $819.9 million of cash from operating activities in the reported quarter. The adjusted free cash flow was $513.2 million.
In the September quarter of 2022, RSG returned $145.3 million of total cash to its shareholders (including $203.5 million of share repurchases and $145.3 million of dividends paid).
During the reported quarter, RSG did not repurchase any shares. As of Jun 30, 2022, the remaining authorized purchase capacity under October 2020 buyback program was $1.5 billion.
Currently, Republic Services carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Dividend Declared
RSG announced that its board cleared a quarterly cash dividend of 49.5 cents per share. The dividend will be paid out on Jan 13, 2023, to its shareholders of record as of Jan 3.
Recent Releases
Omnicom Group Inc. OMC reported impressive third-quarter 2022 results, wherein both earnings and revenues surpassed the respective Zacks Consensus Estimate.
Earnings of $1.77 per share beat the consensus mark by 7.9% and increased 7.3% year over year, driven by a strong margin performance. Total revenues of $3.4 billion surpassed the consensus estimate by 3% and increased slightly year over year.
Equifax Inc. EFX reported stellar third-quarter 2022 results, wherein both earnings and revenues surpassed the respective Zacks Consensus Estimate.
Adjusted earnings (excluding 39 cents from non-recurring items) of $1.73 per share beat the Zacks Consensus Estimate by 5.5% but decreased 6.5% on a year-over-year basis. However, revenues of $1.24 billion beat the consensus estimate by 2.3% and improved 1.8% year over year on a reported basis and 4% on a local-currency basis.
The Interpublic Group of Companies, Inc. IPG reported better-than-expected third-quarter 2022 results.
Adjusted earnings (excluding a penny from non-recurring items) of 63 cents per share beat the Zacks Consensus Estimate by 6.8%. The bottom line has been constant over the past year. Net revenues of $2.3 billion beat the consensus estimate by 0.3% but declined 9.7% on a year-over-year basis. Total revenues of $2.64 billion increased 3.8% year over year.
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