Waste Connections (WCN) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue increased 11.2% year-over-year to $2.25 billion, driven by price increases, acquisitions, and higher commodity values.

• Adjusted EBITDA for Q2 was $731.8 million, up 16.4% year-over-year, with a margin of 32.6%.

• Net income for Q2 was $275.5 million ($1.07 per share), up 31.7% year-over-year.

• Record M&A activity with 18 acquisitions closed or signed YTD, totaling over $650 million in annualized revenue.

• Employee retention improved for the seventh consecutive quarter, with open positions down 45% from 2022 peaks.

Financial highlights

• Q2 revenue reached $2.25 billion, up 11.2% year-over-year and above guidance.

• Adjusted EBITDA was $731.8 million, up 16.4% year-over-year, with a margin of 32.6%.

• Adjusted free cash flow YTD was $727.4 million, up 15% year-over-year, representing 16.8% of revenue.

• Net income for Q2 was $275.5 million, with operating income at $424.7 million, up 23.4% year-over-year.

• Net interest expense was $78.4 million, with $1.26 billion in liquidity and a leverage ratio of 2.67x debt to Adjusted EBITDA.

Outlook and guidance

• Full-year 2024 revenue outlook raised to $8.85 billion and Adjusted EBITDA to $2.9 billion (32.8% margin), both above initial guidance.

• Q3 2024 revenue expected between $2.275-$2.3 billion, with Adjusted EBITDA margin of 33.7%.

• Adjusted free cash flow guidance for 2024 remains at $1.2 billion on $1.15 billion CapEx.

• 2025 expected to benefit from price-led organic growth and rollover from acquisitions.

• Guidance assumes no material change in economic conditions and excludes future acquisitions.