Waste Connections Reports First Quarter 2026 Results

Better than expected Q1 results, with improving trends positioning for upside to 2026 outlook Revenue of $2.371 billion, above expectations and up 6.4% year over year Net income of $219.3 million and adjusted EBITDA(a) of $769.5 million, above expectations and up 8.0% year over year Adjusted EBITDA margin(a) of 32.5%, above expectations and up 50 basis points year over year Net income and adjusted net income(a) per share of $0.86 and $1.23, respectively Year-to-date share repurchases of 1% of outstanding shares TORONTO -- (Business Wire) Waste Connections, Inc. (TSX/NYSE: WCN) (“Waste Connections” or the “Company”) today announced its results for the first quarter of 2026. “We’re extremely pleased by the strong start to 2026 and remain well-positioned for the full year, with upside potential from commodity-related impacts, solid waste organic growth and additional acquisitions. On revenue and adjusted EBITDA above our expectations, we delivered adjusted EBITDA(a) margin of 32.5% in spite of outsized weather events and in advance of recovering higher fuel costs,” said Ronald J. Mittelstaedt, President and Chief Executive Officer. “In spite of geopolitical instability, our results reflect consistency of execution as we continue to benefit from operating momentum from improved employee engagement, with safety performance at record levels and voluntary turnover now below 10%,” continued Mr. Mittelstaedt. “Moreover, we should be well-positioned for incremental benefits from higher fuel and other commodities, as well as strong pricing retention and increased special waste activity, and also longer term as a result of our expanding use of A.I. through technology-related investments.” Mr. Mittelstaedt concluded, “Finally, we continue to anticipate another outsized year of acquisition activity, given a robust pipeline, along with increasing return of capital to shareholders, including year-to-date share repurchases of over $360 million or approximately 1% of shares outstanding.” Q1 2026 Results Revenue in the first quarter totaled $2.371 billion, up from $2.228 billion in the prior year period. Operating income was $364.1 million, which included $80.4 million primarily in impairments related to adjustments to landfill closure and post closure costs. This compares to operating income of $390.2 million in the prior year period, which included $20.2 million primarily in transaction-related expenses, impairments and other operating items and fair value accounting changes associated with certain equity awards. Net income in the first quarter was $219.3 million, or $0.86 per share on a diluted basis of 255.9 million shares. In the prior year period, the Company reported net income of $241.5 million, or $0.93 per share on a diluted basis of 258.9 million shares. Adjusted net income(a) in the first quarter was $314.9 million, or $1.23 per diluted share, up from $293.1 million, or $1.13 per diluted share, in the prior year period. Adjusted EBITDA(a) in the first quarter was $769.5 million, up from $712.2 million in the prior year period. Adjusted net income, adjusted net income per diluted share and adjusted EBITDA, all non-GAAP measures, primarily exclude impairments and transaction-related items, as reflected in the detailed reconciliations in the attached tables. Q1 2026 Earnings Conference Call Waste Connections will be hosting a conference call related to first quarter earnings on April 23rd at 8:30 A.M. Eastern Time. A live audio webcast of the conference call can be accessed by visiting investors.wasteconnections.com and selecting "Events & Presentations" from the website menu. Alternatively, conference call participants can preregister by clicking here. Registered participants will receive dial-in instructions and a personalized code for entry to the conference call. Shortly after the conclusion of the conference call, a webcast replay will be available on the Waste Connections investor website or by clicking here. About Waste Connections Waste Connections (wasteconnections.com) is an integrated solid waste services company that provides non-hazardous waste collection, transfer and disposal services, including by rail, along with resource recovery primarily through recycling and renewable fuels generation. The Company serves approximately nine million residential, commercial and industrial customers in mostly exclusive and secondary markets across 46 states in the U.S. and six provinces in Canada. Waste Connections also provides non-hazardous oilfield waste treatment, recovery and disposal services in several basins across the U.S. and Canada, as well as intermodal services for the movement of cargo and solid waste containers in the Pacific Northwest. Waste Connections views its Environmental, Social and Governance (“ESG”) efforts as integral to its business, with initiatives consistent with its objective of long-term value creation and focused on reducing emissions, increasing resource recovery of both recyclable commodities and clean energy fuels, reducing reliance on off-site disposal for landfill leachate, further improving safety and enhancing employee engagement. Visit wasteconnections.com/sustainability for more information and updates on our progress towards targeted achievement. Safe Harbor and Forward-Looking Information This press release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 ("PSLRA"), including "forward-looking information" within the meaning of applicable Canadian securities laws. These forward-looking statements are neither historical facts nor assurances of future performance and reflect Waste Connections' current beliefs and expectations regarding future events and operating performance. These forward-looking statements are often identified by the words "may," "might," "believes," "thinks," "expects," "estimate," "continue," "intends" or other words of similar meaning. All of the forward-looking statements included in this press release are made pursuant to the safe harbor provisions of the PSLRA and applicable securities laws in Canada. Forward-looking statements involve risks and uncertainties. Forward-looking statements in this press release include, but are not limited to, statements about expected 2026 financial results, outlook and related assumptions, and potential acquisition activity. Important factors that could cause actual results to differ, possibly materially, from those indicated by the forward-looking statements include, but are not limited to, risk factors detailed from time to time in the Company's filings with the SEC and the securities commissions or similar regulatory authorities in Canada. You should not place undue reliance on forward-looking statements, which speak only as of the date of this press release. Waste Connections undertakes no obligation to update the forward-looking statements set forth in this press release, whether as a result of new information, future events, or otherwise, unless required by applicable securities laws. – financial tables attached – (a) Non-GAAP measure; see accompanying Non-GAAP Reconciliation Schedule. WASTE CONNECTIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME THREE MONTHS ENDED MARCH 31, 2025 AND 2026 (Unaudited) (in thousands of U.S. dollars, except share and per share amounts)         Three months ended March 31,     2025   2026           Revenues   $ 2,228,176     $ 2,370,631   Operating expenses:             Cost of operations     1,291,443       1,361,099   Selling, general and administrative     250,134       251,119   Depreciation     242,307       267,485   Amortization of intangibles     47,642       47,264   Impairments and other operating items     6,440       79,584   Operating income     390,210       364,080                 Interest expense     (80,875 )     (87,719 ) Interest income     1,770       3,113   Other income, net     1,872       4,085   Income before income tax provision     312,977       283,559                 Income tax provision     (71,467 )     (64,215 ) Net income   $ 241,510     $ 219,344                 Earnings per common share:             Basic   $ 0.94     $ 0.86   Diluted   $ 0.93     $ 0.86                 Shares used in the per share calculations:             Basic     258,193,975       255,347,786   Diluted     258,904,806       255,873,686                               Cash dividends per common share   $ 0.315     $ 0.350   WASTE CONNECTIONS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands of U.S. dollars, except share and per share amounts)                   December 31, 2025   March 31, 2026   ASSETS               Current assets:               Cash and equivalents   $ 45,968     $ 112,447     Accounts receivable, net of allowance for credit losses of $21,402 and $27,828 at December 31, 2025 and March 31, 2026, respectively     1,024,992       1,033,086     Prepaid expenses and other current assets     240,603       230,786     Total current assets     1,311,563       1,376,319                     Restricted cash     183,612       210,199     Restricted investments     80,757       80,397     Property and equipment, net     8,733,327       8,714,069     Operating lease right-of-use assets     312,508       324,034     Goodwill     8,392,249       8,414,577     Intangible assets, net     2,006,200       1,959,957     Other assets, net     109,147       106,803     Total assets   $ 21,129,363     $ 21,186,355       LIABILITIES AND SHAREHOLDERS’ EQUITY               Current liabilities:               Accounts payable   $ 765,227     $ 712,423     Book overdraft     14,674       8,560     Deferred revenue     416,025       424,835     Accrued liabilities     810,367       745,013     Current portion of operating lease liabilities     44,272       46,335     Current portion of contingent consideration     65,029       61,945     Current portion of long-term debt and notes payable     8,667       8,355     Total current liabilities     2,124,261       2,007,466                     Long-term portion of debt and notes payable     8,811,104       9,093,831     Long-term portion of operating lease liabilities     267,000       278,167     Long-term portion of contingent consideration     19,667       19,216     Deferred income taxes     1,085,613       1,113,470     Other long-term liabilities     576,337       616,586     Total liabilities     12,883,982       13,128,736     Commitments and contingencies               Shareholders’ equity:               Common shares: Unlimited shares authorized; 255,661,011 shares issued and 255,614,663 shares outstanding at December 31, 2025; 254,260,257 shares issued and 254,213,909 shares outstanding at March 31, 2026     2,783,431       2,502,503     Additional paid-in capital     373,239       366,546     Accumulated other comprehensive loss     (111,044 )     (141,783 )   Treasury shares: 46,348 and 46,348 shares at December 31, 2025 and March 31, 2026, respectively     -       -     Retained earnings     5,199,755       5,330,353     Total shareholders’ equity     8,245,381       8,057,619     Total liabilities and shareholders’ equity   $ 21,129,363     $ 21,186,355     WASTE CONNECTIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2025 AND 2026 (Unaudited) (in thousands of U.S. dollars)                   Three months ended March 31,       2025   2026   Cash flows from operating activities:               Net income   $ 241,510     $ 219,344     Adjustments to reconcile net income to net cash provided by operating activities:               Loss from disposal of assets, impairments and other     7,778       2,519     Adjustments to closure and post-closure liabilities     -       76,845     Depreciation     242,307       267,485     Amortization of intangibles     47,642       47,264     Deferred income taxes, net of acquisitions     36,165       28,537     Current period provision for expected credit losses     2,470       12,105     Amortization of debt issuance costs     2,034       2,163     Share-based compensation     23,438       17,587     Interest accretion     12,737       11,200     Adjustments to contingent consideration     (1,500 )     -     Other     (1,013 )     127     Net change in operating assets and liabilities, net of acquisitions     (72,029 )     (139,578 )   Net cash provided by operating activities     541,539       545,598               Cash flows from investing activities:           Payments for acquisitions, net of cash acquired     (380,417 )     (63,087 )   Capital expenditures for property and equipment     (212,455 )     (296,596 )   Proceeds from disposal of assets     969       1,779     Other     (11,308 )     2,203     Net cash used in investing activities     (603,211 )     (355,701 )             Cash flows from financing activities:             Proceeds from long-term debt     782,904       1,156,176     Principal payments on notes payable and long-term debt     (541,737 )     (843,898 )   Payment of contingent consideration recorded at acquisition date     (20,137 )     (4,108 )   Change in book overdraft     (110 )     (6,114 )   Payments for repurchase of common shares     -       (283,959 )   Payments for cash dividends     (81,477 )     (88,746 )   Tax withholdings related to net share settlements of equity-based compensation     (28,981 )     (24,515 )   Debt issuance costs     -       (4,008 )   Proceeds from issuance of shares under employee share purchase plan     2,593       3,031     Proceeds from sale of common shares held in trust     324       -     Net cash provided by (used in) financing activities     113,379       (96,141 )                   Effect of exchange rate changes on cash, cash equivalents and restricted cash     (434 )     (690 )             Net increase in cash, cash equivalents and restricted cash     51,273       93,066     Cash, cash equivalents and restricted cash at beginning of period     198,173       229,580     Cash, cash equivalents and restricted cash at end of period   $ 249,446     $ 322,646                                 ADDITIONAL STATISTICS (in thousands of U.S. dollars, except where noted)   Solid Waste Internal Growth: The following table reflects a breakdown of the components of our solid waste internal growth for the three months ended March 31, 2026:       Three months ended March 31, 2026 Yield(a)     4.7 % Surcharges     (0.1 %) Unit Volume(a)     (1.5 %) Recycling     (0.5 %) Foreign Exchange Impact     0.5 % Total     3.1 %         Core Price(b)     6.0 % ____________________________ (a) In the first quarter of 2026, WCN began providing a breakdown of organic growth in solid waste collection, transfer and disposal to include Yield and Unit Volume, which are performance metrics used by management to evaluate the effectiveness of our pricing and organic growth strategies. Yield, or change in average price per unit of service, reflects the impacts of customer churn and new business activity and the resulting mix by line of business and by geographic segment; Unit Volume reflects estimated change in units of activity. (b) Core Price is defined as the revenue growth attributable to price increases, net of rollbacks, on solid waste collection, transfer and disposal customers. This definition is consistent with Core Price references provided in prior periods. Revenue Breakdown: The following table reflects a breakdown of our revenue for the three-month periods ended March 31, 2025 and 2026:               Three months ended March 31, 2025       Revenue   Inter-company Elimination   Reported Revenue   % Solid Waste Collection   $ 1,621,077   $ (4,536 )   $ 1,616,541   72.5 % Solid Waste Disposal and Transfer     658,023     (296,282 )     361,741   16.2 % Solid Waste Recycling     61,341     (2,084 )     59,257   2.7 % E&P Waste Treatment, Recovery and Disposal     150,899     (6,374 )     144,525   6.5 % Intermodal and Other     46,549     (437 )     46,112   2.1 % Total   $ 2,537,889   $ (309,713 )   $ 2,228,176   100.0 %     Three months ended March 31, 2026       Revenue   Inter-company Elimination   Reported Revenue   % Solid Waste Collection   $ 1,709,628   $ (5,182 )   $ 1,704,446   71.9 % Solid Waste Disposal and Transfer     714,624     (328,515 )     386,109   16.3 % Solid Waste Recycling     53,649     (2,061 )     51,588   2.2 % E&P Waste Treatment, Recovery and Disposal     187,572     (8,013 )     179,559   7.6 % Intermodal and Other     49,346     (417 )     48,929   2.0 % Total   $ 2,714,819   $ (344,188 )   $ 2,370,631   100.0 % ADDITIONAL STATISTICS (continued) (in thousands of U.S. dollars, except where noted)   Contribution from Acquisitions: The following table reflects revenues from acquisitions, net of divestitures, for the three- month periods ended March 31, 2025 and 2026:           Three months ended March 31,     2025   2026 Acquisitions, net   $ 129,298   $ 55,253 Other Cash Flow Items: The following table reflects cash interest and cash taxes for the three-month periods ended March 31, 2025 and 2026:         Three months ended March 31,     2025   2026 Cash Interest Paid   $ 84,154   $ 108,244 Cash Taxes Paid     22,176     21,873   Debt to Book Capitalization at March 31, 2026: 53% Internalization for the three months ended March 31, 2026: 60% Days Sales Outstanding for the three months ended March 31, 2026: 39 (23 net of deferred revenue) Share Information for the three months ended March 31, 2026:   Basic shares outstanding 255,347,786 Dilutive effect of equity-based awards   525,900 Diluted shares outstanding   255,873,686 NON-GAAP RECONCILIATION SCHEDULE (in thousands of U.S. dollars, except where noted)   Reconciliation of Adjusted EBITDA: Adjusted EBITDA, a non-GAAP financial measure, is provided supplementally because it is widely used by investors as a performance and valuation measure in the solid waste industry. Management uses adjusted EBITDA as one of the principal measures to evaluate and monitor the ongoing financial performance of Waste Connections’ operations. Waste Connections defines adjusted EBITDA as net income, plus income tax provision, plus interest expense, less interest income, plus depreciation and amortization expense, plus closure and post-closure accretion expense, plus or minus any loss or gain on impairments and other operating items, plus other expense, less other income. Waste Connections further adjusts this calculation to exclude the effects of other items management believes impact the ability to assess the operating performance of its business. This measure is not a substitute for, and should be used in conjunction with, GAAP financial measures. Other companies may calculate adjusted EBITDA differently.       Three months ended March 31,     2025   2026 Net income   $ 241,510   $ 219,344 Plus: Income tax provision     71,467     64,215 Plus: Interest expense     80,875     87,719 Less: Interest income     (1,770)     (3,113) Plus: Depreciation and amortization     289,949     314,749 Plus: Closure and post-closure accretion     11,874     10,291 Plus: Impairments and other operating items     6,440     79,584 Less: Other income, net     (1,872)     (4,085) Adjustments:             Plus: Transaction-related expenses(a)     11,970     2,360 Plus/(Less): Fair value changes to equity awards(b)     1,770     (1,536) Adjusted EBITDA   $ 712,213   $ 769,528               As % of revenues     32.0%     32.5% ____________________________ (a) Reflects the addback of acquisition-related transaction costs. (b) Reflects fair value accounting changes associated with certain equity awards. NON-GAAP RECONCILIATION SCHEDULE (continued) (in thousands of U.S. dollars, except where noted)   Reconciliation of Adjusted Free Cash Flow: Adjusted free cash flow, a non-GAAP financial measure, is provided supplementally because it is widely used by investors as a liquidity measure in the solid waste industry. Waste Connections calculates adjusted free cash flow as net cash provided by operating activities, plus or minus change in book overdraft, plus proceeds from disposal of assets, less capital expenditures for property and equipment. Waste Connections further adjusts this calculation to exclude the effects of items management believes impact the ability to evaluate the liquidity of its business operations. This measure is not a substitute for, and should be used in conjunction with, GAAP liquidity or financial measures. Other companies may calculate adjusted free cash flow differently.       Three months ended March 31,     2025   2026 Net cash provided by operating activities   $ 541,539     $ 545,598   Less: Change in book overdraft     (110 )     (6,114 ) Plus: Proceeds from disposal of assets     969       1,779   Less: Capital expenditures for property and equipment     (212,455 )     (296,596 ) Adjustments:         Transaction-related expenses(a)     2,392       1,614   Pre-existing Progressive Waste share-based grants(b)     16       -   Executive separation costs(c)     449       -   Tax effect(d)     (725 )     (404 ) Adjusted free cash flow   $ 332,075     $ 245,877         As % of revenues     14.9 %     10.4 % (a) Reflects the addback of acquisition-related transaction costs. (b) Reflects the cash settlement of pre-existing Progressive Waste share-based awards during the period. (c) Reflects the cash component of severance expense associated with an executive departure from 2023. (d) The aggregate tax effect of footnotes (a) through (c) is calculated based on the applied tax rates for the respective periods. NON-GAAP RECONCILIATION SCHEDULE (continued) (in thousands of U.S. dollars, except per share amounts)   Reconciliation of Adjusted Net Income and Adjusted Net Income per Diluted Share: Adjusted net income and adjusted net income per diluted share, both non-GAAP financial measures, are provided supplementally because they are widely used by investors as valuation measures in the solid waste industry. Management uses adjusted net income and adjusted net income per diluted share as one of the principal measures to evaluate and monitor the ongoing financial performance of Waste Connections’ operations. Waste Connections provides adjusted net income to exclude the effects of items management believes impact the comparability of operating results between periods. Adjusted net income has limitations due to the fact that it excludes items that have an impact on the Company’s financial condition and results of operations. Adjusted net income and adjusted net income per diluted share are not a substitute for, and should be used in conjunction with, GAAP financial measures. Other companies may calculate these non-GAAP financial measures differently.           Three months ended March 31,   2025   2026 Reported net income   $ 241,510     $ 219,344   Adjustments:             Amortization of intangibles(a)     47,642       47,264   Impairments and other operating items(b)     6,440       79,584   Transaction-related expenses(c)     11,970       2,360   Fair value changes to equity awards(d)     1,770       (1,536 ) Tax effect(e)     (16,212 )     (32,136 ) Adjusted net income   $ 293,120     $ 314,880   Diluted earnings per common share:             Reported net income   $ 0.93     $ 0.86   Adjusted net income   $ 1.13     $ 1.23   (a) Reflects the elimination of the non-cash amortization of acquisition-related intangible assets. (b) Reflects the addback of impairments and other operating items. (c) Reflects the addback of acquisition-related transaction costs. (d) Reflects fair value accounting changes associated with certain equity awards. (e) The aggregate tax effect of the adjustments in footnotes (a) through (d) is calculated based on the applied tax rates for the respective periods.   View source version on businesswire.com: https://www.businesswire.com/news/home/20260422005378/en/ Contacts: Mary Anne Whitney / (832) 442-2253 Joe Box / (832) 442-2153 [email protected]@wasteconnections.com Source: Waste Connections, Inc.