RUTLAND, Vt., Feb. 25, 2015 (GLOBE NEWSWIRE) -- Casella Waste Systems, Inc. (Nasdaq:CWST), a regional solid waste, recycling and resource management services company, today reported financial results for the eight month transition period ended December 31, 2014 ("Transition Period 2014"). The company also reaffirms guidance for its next full fiscal year ending December 31, 2015.

Transition Period 2014 Financial Highlights

• Revenues for Transition Period 2014 were $368.4 million up 8.3% from the same period in 2013, exceeding the company's previously announced guidance range of $356.0 million to $366.0 million.
• Adjusted EBITDA* for Transition Period 2014 was $74.7 million up $1.7 million from the same period in 2013, at the high end of the company's previously announced guidance range of $71.0 million to $75.0 million. Excluding the impact of the closure of the Worcester landfill, the company's Adjusted EBITDA was up $4.5 million from the same period in 2013.
• Overall solid waste pricing was up 1.0%, mainly driven by strong residential and commercial collection pricing up 2.2%.

"Over the last two years, we have successfully refocused the company's strategy and made excellent progress towards our long-term goals," said John W. Casella, chairman and CEO of Casella Waste Systems, said. "We continue to execute on each of our key management strategies with notable gains at our landfills, where we have increased annualized landfill volumes by 660,000 tons per year since fiscal year 2013, up from 3.6 million tons per year to 4.2 million tons per year."

"We continue to see competitor disposal facilities permanently close across the Northeast, with roughly 1.5 million tons of annual disposal capacity closed over the last three years and another 1.3 million tons of annual disposal capacity expected to close over the next several years," Casella said. "We have excellent asset positioning in these markets, and have been able to capitalize on the changing dynamics to gain market share, improve pricing, and drive higher cash flows and returns. We expect to further take advantage of these improving disposal market dynamics in fiscal year 2015 through our focused sales efforts and targeted pricing initiatives."

"Since late 2014 and into early 2015, recycling commodity prices have continued to decline, with the average commodity revenue per ton down roughly 25% since October 2014," Casella said. "We believe that these declines in recycling commodity prices are not short-lived, but rather reflect changing international markets for recycled commodity products, including lower demand from the Chinese markets due to slower economic growth and growth in the Chinese domestic markets. We have taken action to begin to reshape our recycling business model through increased tipping fees at our recycling facilities and pricing increases to our collection customers to reflect the dramatically lower recycling commodity values. We expect these actions to offset a significant portion of the impact associated with lower commodity prices in fiscal year 2015."

For Transition Period 2014, revenues were $368.4 million, up $28.3 million, or 8.3%, from the same period in 2013, with revenue growth mainly driven by higher solid waste disposal volumes, Customer Solutions growth, and acquisitions. 

Adjusted EBITDA was $74.7 million for Transition Period 2014, up $1.7 million from the same period in 2013. Excluding the negative impact of the closure of the Worcester landfill, Adjusted EBITDA was up $4.5 million from the same period last year. In addition, higher than anticipated healthcare costs negatively impacted results in Transition Period 2014, with healthcare costs up $2.6 million from the same period in 2013. 

Operating income was $22.1 million for Transition Period 2014, up $0.2 million from the same period in 2013. Transition Period 2014 includes a $1.0 million environmental remediation charge associated with the movement of stockpiled earth at our Southbridge landfill, a $0.6 million gain resulting from the reversal of the excess remaining reserves not needed to complete the site improvements related to the divestiture of our BioFuels operation, and $0.5 million of expenses related to our change in fiscal year end; while the same period in 2013 included a $0.4 million environmental remediation charge, $0.1 million of expense from divestiture, and $0.2 million of severance and reorganization costs.

The company's net loss attributable to common stockholders was ($6.0) million, or ($0.15) per share for Transition Period 2014, compared to ($3.7) million, or ($0.09) per share for the same period in 2013.  In addition to the unusual items identified above, Transition Period 2014 includes a $2.3 million impairment of our investment in RecycleRewards, Inc., while the 2013 period included a $0.8 million gain on the divestiture of the Company's 50% membership interest in US GreenFiber LLC and a $0.1 million loss from discontinued operations. 

"Overall, our team has done an excellent job driving higher revenues in each of our business lines," Casella said. "We're pleased with the execution of our key management strategies to date and, while we still have work to do, we are optimistic about the company's positioning for 2015 and beyond."

Outlook

The company reaffirmed guidance for its next full fiscal year ending December 31, 2015, by estimating results in the following ranges:

• Revenues between $520 million and $530 million (as compared to $525.9 million for the twelve months ended December 31, 2014);
• Adjusted EBITDA* between $103 million and $107 million (as compared to $96.9 million for the twelve months ended December 31, 2014); and
• Free Cash Flow* between $14 million and $18 million (as compared to ($9.7) million for the twelve months ended December 31, 2014).

The company provided the following assumptions that are built into its fiscal year 2015 outlook:

• No material changes in the regional economy from the last 12 months.
• In the solid waste business, revenue growth of between 0% and 2%, with price growth from 1% to 2%. 
• In the recycling business, overall revenue declines of between (10%) and (14%), driven by lower commodity price, partially offset by higher volumes. 
• In the Other segment, revenue growth of between 1% and 2%, principally due to growth in the Customer Solutions group.
• No acquisitions beyond the above-mentioned roll-over impact of the acquisitions completed during the last 12 months are included.
• Capital Expenditures of between $45 million and $48 million, and payments on operating leases of roughly $6.5 million.

Conference call to discuss quarter

The Company will host a conference call to discuss these results on Thursday, February 26, 2015 at 10:00 a.m. Eastern Time. Individuals interested in participating in the call should dial (877) 838-4153 or for international participants (720) 545-0037 at least 10 minutes before start time. The call will also be webcast; to listen, participants should visit Casella Waste Systems' website at http://ir.casella.com and follow the appropriate link to the webcast. A replay of the call will be available on the company's website, or by calling (855) 859-2056 or (404) 537-3406 (Conference ID 76800251) until 11:59 p.m. ET on Thursday, March 5, 2015. 

About Casella Waste Systems, Inc.

Casella Waste Systems, Inc., headquartered in Rutland, Vermont, provides solid waste management services consisting of collection, transfer, disposal, and recycling services in the northeastern United States. For further information, investors contact Ned Coletta, Chief Financial Officer at (802) 772-2239; media contact Joseph Fusco, Vice President at (802) 772-2247; or visit the company's website at http://www.casella.com.

*Non-GAAP Financial Measures

In addition to disclosing financial results prepared in accordance with Generally Accepted Accounting Principles in the United States ("GAAP"), the company also discloses earnings before interest, taxes, depreciation and amortization, adjusted for accretion, depletion of landfill operating lease obligations, gain on sale of assets, development project charge write-offs, legal settlement costs, tax settlement costs, bargain purchase gains, asset impairment charges, environmental remediation charges, severance and reorganization costs, (gains) expenses from divestiture, acquisition and financing costs, gains on the settlement of acquisition related contingent consideration, fiscal year-end transition costs, as well as losses on divestiture ("Adjusted EBITDA") which is a non-GAAP measure. 

The company also discloses earnings before interest, taxes, adjusted for gain on sale of assets, development project charge write-offs, legal settlement charges, tax settlement costs, bargain purchase gains, asset impairment charges, environmental remediation charges, severance and reorganization costs, (gains) expenses from divestiture, acquisition and financing costs, gains on the settlement of acquisition related contingent consideration, fiscal year-end transition costs, as well as losses on divestiture ("Adjusted Operating Income") which is a non-GAAP measure. 

The company also discloses net cash provided by operating activities, less capital expenditures (excluding acquisition related capital expenditures), less payments on landfill operating leases, less assets acquired through financing leases, plus proceeds from the sale of property and equipment, plus contributions from non-controlling interest holders ("Free Cash Flow"), which is a non-GAAP measure. 

And lastly, the company discloses Free Cash Flow plus landfill closure, site improvement and remediation expenditures, plus new contract and project capital expenditures ("Normalized Free Cash Flow"), which is a non-GAAP measure.

Adjusted EBITDA and Adjusted Operating Income are reconciled to net income (loss), while Free Cash Flow and Normalized Free Cash Flow are reconciled to net cash provided by operating activities.

The company presents Adjusted EBITDA, Adjusted Operating Income, Free Cash Flow, and Normalized Free Cash Flow because it considers them important supplemental measures of its performance and believes they are frequently used by securities analysts, investors and other interested parties in the evaluation of the company's results. Management uses these non-GAAP measures to further understand the company's "core operating performance." The company believes its "core operating performance" is helpful in understanding its ongoing performance in the ordinary course of operations. The company believes that providing Adjusted EBITDA, Adjusted Operating Income, Free Cash Flow, and Normalized Free Cash Flow to investors, in addition to corresponding income statement and cash flow statement measures, affords investors the benefit of viewing its performance using the same financial metrics that the management team uses in making many key decisions and understanding how the core business and its results of operations has performed. The company further believes that providing this information allows its investors greater transparency and a better understanding of its core financial performance. In addition, the instruments governing the company's indebtedness use EBITDA (with additional adjustments) to measure its compliance with covenants.

Non-GAAP financial measures are not in accordance with or an alternative for GAAP. Adjusted EBITDA, Adjusted Operating Income, Free Cash Flow, and Normalized Free Cash Flow should not be considered in isolation from or as a substitute for financial information presented in accordance with GAAP, and may be different from Adjusted EBITDA, Adjusted Operating Income, Free Cash Flow, or Normalized Free Cash Flow presented by other companies.

Safe Harbor Statement

Certain matters discussed in this press release are "forward-looking statements" intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such by the context of the statements, including words such as "believe," "expect," "anticipate," "plan," "may," "will," "would," "intend," "estimate," "guidance" and other similar expressions, whether in the negative or affirmative. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry and markets in which we operate and management's beliefs and assumptions. We cannot guarantee that we actually will achieve the plans, intentions, expectations or guidance disclosed in the forward-looking statements made. Such forward-looking statements, and all phases of our operations, involve a number of risks and uncertainties, any one or more of which could cause actual results to differ materially from those described in our forward-looking statements. Such risks and uncertainties include or relate to, among other things: adverse weather conditions that have negatively impacted and may continue to negatively impact our revenues and our operating margin; current economic conditions that have adversely affected and may continue to adversely affect our revenues and our operating margin; we may be unable to increase volumes at our landfills or improve our route profitability; our need to service our indebtedness may limit our ability to invest in our business; we may be unable to reduce costs or increase pricing or volumes sufficiently to achieve estimated Adjusted EBITDA and other targets; landfill operations and permit status may be affected by factors outside our control; we may be required to incur capital expenditures in excess of our estimates; fluctuations in energy pricing or the commodity pricing of our recyclables may make it more difficult for us to predict our results of operations or meet our estimates; and we may incur environmental charges or asset impairments in the future. There are a number of other important risks and uncertainties that could cause our actual results to differ materially from those indicated by such forward-looking statements. These additional risks and uncertainties include, without limitation, those detailed in Item 1A, "Risk Factors" in our Form 10-K for the year ended April 30, 2014 and in our Form 10-Q for the quarterly period ended October 31, 2014.

We undertake no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.

CONTACT: Investors:

         Ned Coletta

         Chief Financial Officer

         (802) 772-2239



         Media:

         Joseph Fusco

         Vice President

         (802) 772-2247



         http://www.casella.com

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