Republic Services Inc., Pheonix, has released its financial results for the first quarter of 2022, reporting strong growth, attributable to its focus on profitably growing the recycling and solid waste business and expanding its environmental solutions business.
"Our strong start to the year was made possible through the execution of our strategy that is designed to generate profitable growth," says Jon Vander Ark, president and CEO of Republic. "We delivered double-digit growth in revenue, EBITDA (earnings before interest, taxes, depreciation and amortization) and free cash flow while making investments to expand our environmental solutions business and further build our differentiated capabilities."
The company reports net income of $352 million, or $1.11 per diluted share, for Q1 2022 compared with $295.9 million, or 93 cents per diluted share, in Q1 2021. Excluding certain benefits and expenses, on an adjusted basis, net income was $360.7 million, or $1.14 per diluted share, versus $297.2 million, or 93 cents per diluted share, for the comparable 2021 period.
First-quarter earnings per share (EPS) were $1.11 and adjusted EPS, a nongenerally accepted accounting principle measure, was $1.14 per share. Cash provided by operating activities was $705.6 million, an increase of 6.7 percent compared with the prior year. Adjusted free cash flow was $530.9 million, an increase of 14.4 percent compared with Q1 2021.
Republic says its first-quarter net income was $352 million, or 11.9 percent of revenue. First-quarter adjusted EBITDA was $903.5 million, and the adjusted EBITDA margin was 30.4 percent of revenue compared with 30.7 percent during Q1 2021.
Republic says it invested $65.6 million in acquisitions in the first quarter. This includes closing on the acquisition of US Ecology May 2. The company says the contribution from US Ecology for the remaining eight months of the year will be about $720 million for adjusted EBITDA of about $130 million, including $5 million of realized synergies.
Total cash returned to shareholders was $349.4 million, including $203.5 million of share repurchases and $145.9 million of dividends paid. Revenue growth from average yield was 4.2 percent, and volume increased by 3.6 percent.
Core price increased revenue by 6 percent and consisted of 7.6 percent in the open market and 3.5 percent in the restricted portion of the business. The average yield on total revenue was 4.2 percent, representing an increase of 80 basis points when compared with the Q4 performance of 2021.
The company's average recycled commodity price per ton sold during the first quarter was $201. This represents a decrease of $17 per ton from the fourth quarter of 2021 and an increase of $68 per ton over the prior year.
“Our results demonstrate the positive impact our strategic investments are making in the business, not only for today but for years to come,” Vander Ark says.