Casella Waste Systems, Inc. Announces Fourth Quarter Results

Casella Waste Systems, Inc. reported financial results for the fourth quarter and its 2003 fiscal year, and gave guidance on its expected performance for its 2004 fiscal year.

For the quarter ended April 30 the company reported revenues of $94.5 million. Operating income for the quarter was $250,000. The company's earnings before interest, taxes, depreciation and amortization (EBITDA), and an impairment charge, were $17.1 million*.

The company's fourth quarter results include a one-time impairment charge arising from the sale of the company's Passaic, N.J. brokerage and commercial recycling businesses as well as the reclassification of the commercial recycling business from a discontinued operation to a continuing operation.

For the fiscal year the company reported revenues of $420.9 million. Operating income for the year was $34.0 million.

"Quarter after quarter over the past year was marked by the company's very deliberate return to a growth strategy," John Casella, chairman and CEO, said. "We have positioned this company well to capitalize on emerging opportunities:

The company provided details on the sale of its non-core recycled commodities brokerage and commercial recycling businesses located in Passaic, New Jersey; this transaction was announced in early-June.

The company said the businesses were sold to a group of employees who had been responsible for the operation of the business in exchange for notes receivable amounting to approximately $5 million, payable only out of the cash flow of the transferred business.

In connection with the sale of the businesses, the company said it was taking an impairment charge of $4.9 million, which includes a reclassification adjustment.

This divestiture reduces the company's annual revenue by approximately $18 million; combined with the previous sale of the company's export brokerage business earlier this year, the company's 2003 revenue from the divested brokerage businesses totaled approximately $35 million with an operating loss of approximately $100,000 including depreciation of approximately $125,000.