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By the numbers
Q1 net income: $241.5M
Up from $229.1 million year over year
Q1 adjusted EBITDA: $712.2M
Up 9.5% year over year, representing 32% of revenue
- Financial picture: During an earnings call on Thursday, Waste Connections CEO Ron Mittelstaedt said he was “extremely pleased” with the start to the year, noting that factors such as pricing, employee retention and acquisition integration were “all driving better than expected, especially during the seasonally weakest quarter” of the year.
- Acquisitions: Waste Connections is continuing “outsized levels” of acquisition activity, noting annualized revenues so far this year of over $125 million. That includes the acquisition of a “state-of-the-art” recycling facility in New Jersey, which Mittelstaedt said is important to support growth in the Northeast, especially for its commercial waste collection contracts in New York City. Mittelstaedt said more solid waste deals are in the works in all its operating regions of the U.S. and Canada, and they are a mix of tuck-ins, standalones and franchise deals.
- Volume: Solid waste volume was down 2.8% in the quarter, mainly due to “outsized weather-related events” in February throughout the south and southeastern U.S. Volume began to pick up again in March, said CFO Mary Anne Whitney. The company is almost done with its ongoing plan to conduct “purposeful shedding and non-renewal” of contracts it considers “poor quality,” which has also had an effect on volume, Mittelstaedt said. Landfill tons were up 1%, MSW tons were up 2% and special waste tons were up 6%. That was partially offset by weaker C&D tons, which were down 6%.
- Price trends: Core pricing was up sequentially to 6.9%, exceeding Waste Connections’ original outlook. Price was closer to 4.5% in the Western region, a nearly exclusive market, while it was closer to 8.5% in competitive markets. Over 75% of the company’s price increases are in place for the year, which strengthens its expectation that full-year 2025 core pricing will be at least 6%, Whitney said.
- Tariff impacts: So far in 2025, Waste Connections has not seen any “noteworthy” tariff or economy-related impacts to the business, “including with respect to solid waste organic growth,” Mittelstaedt said. The company is still awaiting 10 truck chassis he said might be subject to tariffs, but beyond that “there’s virtually no exposure.” For equipment parts, the company is beginning to source some of its inventory from American manufacturers to avoid possible tariff impacts in the future.
- Recycling and RINs: Values for both OCC and renewable energy credits were down in Q1 about 20% year over year, but were stable at those levels throughout the quarter, Whitney said. OCC averaged about $105 per ton, while RINs averaged about $2.45, “with little movement in either thus far in Q2.”
- Safety milestone: Waste Connections has logged its lowest-ever safety incident rate for the quarter, Mittelstaedt said, which is notable because the company has recently added “dramatically more employees and vehicles” through acquisitions. Year-over-year incident counts went down 40% in “recent months,” due mainly to a culture of safety training and a focus on employee retention, he said.
- Q2 outlook: Waste Connections reiterated its Q2 outlook, estimating a revenue range of between $2.375 billion and $2.4 billion. Adjusted EBITDA margin in Q2 is an estimated 32.7%. Despite “broader macroeconomic uncertainty,” Mittelstaedt said so far there have been no incremental capital or expense increases associated with tariffs or other factors that would alter the company’s 2025 outlook. However, the company is “acknowledging that uncertainty” from tariffs and future impacts could affect the 2026 outlook, he said.
