Good times in disposal and recycling
Waste Management representatives attended this year’s waste industry consortium, Waste Expo, with a string of milestones achieved in 2016. By the gathering’s end, Devina Rankin, Waste Management CFO, said the Houston company’s outlook for the rest of the year shone brightly.
“Consensus across the board at this year’s Waste Expo is it’s really hard to look at the business and find a better time for this industry,” Rankin said.
The commercial waste disposal and recycling company ranked No. 9 among Houston’s top public companies, with $13.6 billion reported in revenue for 2016 — growth of 5 percent, with earnings per share growth of 60.6 percent.
It’s the best revenue growth Waste Management has seen since 2011, driven largely by the domino effect of a growing housing market, increased attention to customer service, renegotiated municipal recycling contracts and a boost from recycling commodity prices.
As the housing market continues its rise out of the recession’s ashes, the corresponding growth in commercial construction has led to more waste production and thus more work for Waste Management. The company’s continued attention to serving customers in turn led to the lowest customer turnover rate since 2002, Rankin said.
Contract renegotiations in major metro areas for recycling also boosted the numbers. Last year, for instance, the company revised a twoyear deal with the city of Houston to raise the cost of processing and reselling its recyclables by $35 per ton. The new contract also ceased glass collection from the local curbside recycling program — a moneysaving strategy for Waste Management.
Rankin said such renegotiations allowed the company to better capitalize on the often unpredictable recycling commodity prices. The industry overall benefited from a sharp rise in prices in the later half of 2016, and the tide continued to grow into the first few months of 2017. The growing interest in e-commerce and the use of corrugated cardboard for the delivery of online purchases largely contributed to the commodity price uptick.