Casella Waste Systems, Rutland, Vermont, released its second-quarter financial earnings Aug. 1, reporting a revenue of $187.5 million for the three months ended June 30.

More highlights from the quarter include:

• Revenues in the second quarter were $187.5 million, up $21.8 million (13.2 percent) year over year. Acquisition activity drove 8.9 of this growth.
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $40.4 million in the quarter, up $3.3 million (8.9 percent) year over year.
• Solid waste revenues were up $17.4 million (13.8 percent) year over year as a percentage of solid waste revenues, with price up 5.1 percent, volumes up 0.4 percent and 11.8 percent growth from the rollover impact of acquisitions.
• Revenues in the collection lines of business were up $17.5 million year over year, with price up 5.5 percent across all lines of business, volumes slightly down and acquisitions up $13 million. Collection operations generated about 49 percent of revenue and grew almost 24 percent, primarily through acquisitions.
• Revenues in the disposal line of business were up $900,000 year over year, despite a $3.7 million year-over-year revenue headwind from a landfill closure.
• Landfill pricing was up 6 percent year over year, and average price per ton at the landfill was up 5.9 percent.
• Recycling revenues were up $900,000 year over year with $1.3 million lower commodity pricing, fully offset by $1.6 million higher third-party tipping fees and $600,000 of higher volumes.
  

Company Chairman and CEO John Casella joined other company executives on an earnings call to discuss Q2 activity in terms of the company’s five key strategies laid out in its 2021 plan. Here are the highlights from John Casella.

Strategy one: Increasing landfill returns

“…As we drive price on existing volumes, we are also replacing lower price streams with higher price customers, which blends up overall pricing and enhances our returns.

“That said, we did experience a couple of notable adjusted EBITDA headwinds in the second quarter related to higher cost due to a very wet spring, particularly in May and June. And these costs have moderated into Q3 as things have begun to dry out. The expected closure of the Southbridge Landfill in November 2018, and higher operating costs at the Ontario Landfill as we worked in the second quarter to resolve odor issues and make site improvements to resolve other issues—most of this work was completed by the end of the second quarter.”

Strategy two: Driving profitability in hauling business

“As we experienced heightened inflation related to disposal recycling and labor, it’s important that our pricing programs are nimble as we aim to outpace costs and expand our margins.

”We have continued to find success in our ability to adjust pricing quickly,  and as such, we advanced 5.5 percent collection pricing in the quarter. In several markets, this was not enough to price to overcome inflation. We are working hard to drive through further operating efficiency and review profitability of our book of business and advance further pricing to offset additional inflation.

“At the same time, on a monthly basis, we continue to adjust our SRA [Sustainability/Recycling Adjustment] and E&E [energy and environmental] fees based on market conditions. These programs are working well to offset recycling, commodity pressures, environmental and regulatory costs.”

Strategy three: Creating value with resource solutions

“We built recycling infrastructure that helps to insulate us from volatility and declines in the global recycling markets through our third-party recycling processing contract structure, which allows us to pass commodity risk back to the customer, coupled with our SRA program, which is fully offsetting the commodity risk on our intercompany volumes.

“With this, year-to-date declines in recycling commodity prices have not materially impacted our 2019 recycling forecast. On July 1, we entered into a new recycling processing contract with the city of Boston that reset pricing into appropriate levels to cover current low commodity prices or passing commodity risk back to the city.

“As we have discussed previously, this contract was a significant headwind for us in the recent past, so this was a nice win for the company that allows us to garner an appropriate return on our recycling assets. As we continue to make progress restructuring our third-party contracts, we are also focused on enhancing our contamination fee program, which should help drive improved customer behavior with recycling.

“We’ve also recently kicked off two recycling equipment upgrade projects, which will reduce operating costs and improve the quality of our outbound materials. … A significant driver of the team success has been the ability to capture share of wallet for major industrial customers across our franchise.”

Strategy four: Using technology to drive profitable and efficient growth

“We are pleased with the progress we have made against this initiative over the last 18 months. A prime example is related to our 2018 launch of NetSuite. We are starting to see the benefits begin to play out as we grow the business and not add back-office headcount as we further simplify and better automate the purchasing process. We are getting better scale and we are well-positioned to drive further costs out of our existing processes.

“We have also experienced early success related to our new case management system, which serves to better integrate our sales and customer care teams. We will continue to target enhancing our responsiveness to our customers and improving their overall experience.”

Strategy five: Allocating capital to smart growth

“We’ve completed four acquisitions year to date with annualized revenues of roughly $18.5 million. As previously announced, we signed an asset purchase agreement to acquire select solid waste assets in Albany, New York, and Cheshire, Massachusetts, markets that are producing roughly $30 million of annualized revenues.

“We expect this transaction to close in the third quarter. This will be a great strategic fit to our assets. Given this acquisition, we are on pace again to seed our goal to acquire $20 million to $40 million of annualized revenues.

“We remain focused on driving synergies from acquisitions through the integration of our operations, operating programs, systems and back office. As we had previously discussed, we have completed the finance back office and systems integration work for all of the acquisitions completed in 2018. We remain bullish on the strength of our acquisition pipeline that overlays our existing operational footprint or that is adjacent strategic markets.”

Mill Rock Capital Management LP, a private investment firm based in New York City, has announced that its affiliates have made a strategic investment in Dallas-based Venture Metals LLC and SI Metallics LLC in partnership with management. Mill Rock reports that Venture has acquired Versatile Processing Group Inc. (VPG), which is based in Indianapolis. 

The transaction combines two U.S. metal recycling solutions providers of comparable size to create a platform with annual revenues of about $700 million, according to a news release from Mill Rock Capital Management. Further terms of the deal were not disclosed. 

Venture is owned and operated by CEO Mike Uhrick and President Mark Chazanow. The company provides high-touch recycling solutions to the industrials, manufacturing, energy and metals sectors and supplies high-quality refined nonferrous and ferrous metals to domestic and international markets. 

Versatile Processing Group serves as an industrial processor of nonferrous metals, servicing the copper manufacturing, electric utility and general industries. The company specializes in recycling nonferrous materials, including copper, brass, aluminum, zinc, tin, silicon and nickel products sourced from a diverse base of suppliers, with a particular expertise in difficult-to-process units. Services provided include wire and cable chopping, de-tinning and de-oiling, laboratory analysis and logistics. 

The combined company will operate six processing facilities. Two of those facilities will be in Dallas and one facility will be in Des Plaines, Illinois; Houston; Nabb, Indiana; and Wills Point, Texas. The facilities are located in close proximity to customers as well as port and rail access points, Mill Rock reports in a news release announcing the acquisition. The combined organization will be led by Uhrick and Chazanow and the integrated executive teams of both organizations, supported by more than 200 associates. Through the transaction, senior management of both companies invested in partnership with Mill Rock. 

“The Venture team and I are excited to join forces with VPG,” Uhrick says. “VPG is a well-respected company with committed associates, a high-quality management team, specialized processing capabilities and robust infrastructure. We are excited about the growth opportunities of the combined platform and the enhanced capabilities it will provide to all our loyal customers."

“Access to Venture's processing capabilities and global consumer reach represents a significant opportunity for VPG's customers. The transaction will allow us to serve them across a fuller range of metals, while allowing them access to our distribution channels worldwide,” Chazanow adds.

Sharma Rao, a senior principal at Mill Rock, will be joining the company in the role of executive vice president of business development. Rao has managed global metal supply chains at GE Aviation and Rolls-Royce, and was most recently the head of Metals and Strategy at Arconic Inc. In addition, Wayne Hale, Charles Heskett, Adi Pekmezovic, William Plummer and Christopher Whalen of Mill Rock have joined Venture’s board of directors in connection with the transaction. 

Houlihan Lokey, Credit Suisse Securities (USA) LLC, Octant Partners and Milbank LLP advised Mill Rock on the transaction. Deloitte Corporate Finance LLC and Locke Lord LLP advised Venture. KeyBanc Capital Markets and Hunton Andrews Kurth LLP advised VPG.

The San Francisco International Airport (SFO) is planning to ban the sale of single-use plastic water bottles. The ban will take effect on Aug. 20, according to a report in the Associated Press (AP). 

The new rule will apply to airport restaurants, cafes and vending machines. Travelers will need to buy refillable aluminum or glass bottles if they do not bring their own, AP reports. 

The airport is following an ordinance approved in 2014 banning the sale of plastic water bottles on city-owned property, according to AP. SFO retailers already are required to provide only compostable single-use to-go containers, condiment packets, straws and utensils. 

The airport also published a Zero Waste Plan last year. SFO reports that it hopes to become the “world’s first zero waste airport by 2021.” The airport’s Zero Waste Plan outlines measures the SFO needs to take to achieve zero waste by 2021 and work toward becoming a Closed-Loop Circular Campus in the years that follow to control material inputs to maximize recycling and recovery and minimize waste materials generated onsite. 

J.P. Mascaro & Sons, headquartered in Audubon, Pennsylvania, received more than $7.5 million in competitively bid long-term municipal waste collection and recycling contracts. Several Pennsylvania municipalities awarded the company contracts, including Muhlenberg, Hamburg, Catasauqua and Newton. 

“Our company really appreciates the new long-term waste collection and recycling contracts recently awarded to us by the municipalities of Muhlenberg, Hamburg, Catasauqua and Newton, and we look forward to serving these communities and their residents,” says Sam Augustine, director of sales at J.P. Mascaro & Sons.

The company also received a five-year operating permit from the West Virginia Department of Environmental Protection to operate the Brooke County Landfill in Colliers, West Virginia. 

According to a news release from J.P. Mascaro & Sons, the Brooke County Landfill is one of two Mascaro-related landfills in West Virginia, the other being the Wetzel County Landfill in New Martinsville, West Virginia. Those two landfills serve as primary disposal facilities for waste collected by the operating divisions of Solid Waste Services of West Virginia Inc., a J.P. Mascaro-related collection company that serves municipal, commercial and industrial customers in the panhandle region of West Virginia and in eastern Ohio and western Pennsylvania.

“The Brooke County Landfill is an important component of the operational infrastructure of the Mascaro-related waste service businesses in West Virginia, Ohio and Pennsylvania,” says Ryan K. Inch, company director of engineering at J.P. Mascaro. “These businesses not only serve our municipal, commercial and industrial customers, but also are important to the thriving Marcellus and Utica Shale gas development activities occurring in that three-state regional area.”

Giving to students

J.P. Mascaro & Sons has announced that it has awarded $1 million for student scholarships and supplemental education programs for the 2019-2020 school year. According to a news release from J.P. Mascaro & Sons, the awards have been distributed to more than 90 schools, including the St. Catherine of Sienna School in Reading, the John Paul II Center for Special Learning in Shillington, the City School in Philadelphia, the Regina Angelorum Academy in Plymouth Meeting, the St. Cornelius School in Chadds Ford, the AIM Academy in Conshohocken, the MMI Preparatory School in Freeland, the Upland Country Day School in Kennett Square and others.

“During the last seven years, the Mascaro company has awarded approximately $9 million for student scholarships and supplemental educational programming,” says Lindsay Mascaro Ptaszenski, company director of education. “My grandfather and company founder, Joseph P. Mascaro Sr., was a man with a limited formal education, but he was a huge proponent of education in general and of young students having the best educational opportunities possible, regardless of their financial standing, and as a company, J.P. Mascaro & Sons feels the same.”

J.P. Mascaro & Sons company President, Pat Mascaro, says, “When a company commits to funding student scholarships and educational initiatives, it is also committing to the betterment of the local community as a whole. J.P. Mascaro & Sons is proud to have participated substantially in such funding in the past, and it looks forward to doing so for many years to come.”