Based in Houston, Texas, Waste Management (WMI) is one of North America’s largest companies in the solid waste sector. The company operates through three service divisions: collection, disposal and recycling. Through these divisions, WMI operates 279 solid waste landfills, 5 hazardous waste landfills, 293 transfer stations, 33,000 collection and transfer vehicles, and 16 waste to energy facilities. The company’s 57,000 employees serve 25 million residential and 2 million commercial customers. In addition, WMI’s Recycle America subsidiary serves 10 million households and 200,000 commercial customers through 160 materials recovery facilities.
For the first nine months of 2001, WMI recorded US$8.53-billion vs. $9.61-billion in 2000. The company earned US$345-million or 55 cents per share vs. a loss of $136-million or 36 cents per share in 2000. In November 2001, the company settled a 1999 class action lawsuit relating to the company’s merger with USA Waste and financial statements from the first two quarters of 1999 as well as charges in the third quarter of 1999. In the settlement, the company will pay $457-million to purchasers of the company’s securities or options between June 11, 2998 and November 9, 1999.
In other news, the company recently priced a $400-million debt offering of 6.5 per cent, 7-year senior unsecured notes. Also, subsidiary Recycle America opened a new glass recycling facility located in Union City, California, which is expected to produce 160,000 tons (or 176,000 tonnes) of glass annually, and provide recycled glass for the Gallo Glass Company, a subsidiary of the E&J Gallo winery, also of Union City.
HOT SECTOR NEWS
Boralex Inc., an independent power producer based in Montreal, Quebec, entered into an agreement with Seris, SA of France to set up a joint venture to build and operate a wind power plant in Avigonpet-Lauragais, France. The plant is expected to generate 9MW of power starting summer 2002.
The Liquor Control Board of Ontario (LCBO) announced it has provided $4-million to Ontario municipalities to help cover costs associated with recycling alcoholic beverage containers. The LCBO also plans to pay $1-million to help set up the non-profit organization Waste Diversion Ontario, which will develop waste diversion programs in Ontario.
Consolidated Envirowaste Industries Inc. of Abbotsford, B.C. renewed contracts with three Florida cities for green waste processing. The company also received contracts from three additional Florida cities and counties, expected to generate $831,000 per year in revenue.
Vivendi Environnement SA of Paris, France announced nine-month revenues increased 11 per cent to 21.2-billion euros. The company agreed to donate $1-million worth of containers and services to assist in cleaning up Antarctica by moving garbage to Australia. Subsidiary Dalkia International, also of Paris, recently purchased two co-generation plants in the Czech Republic, with a combined generating capacity of 158 MW and 594 MW of heating capacity.
Allied Waste Industries Inc. of Scottsdale, Arizona recently reported third quarter revenues of $1.41-billion, down slightly from $1.47-billion. Net income declined to $18.2-million from $21.9-million. Prior to this, company President and COO Larry Henk resigned to pursue other interests. Chair Todd Van Weelden will assume the role of president, while Don Slager, the VP of operations will take over as COO. Allied also recently priced a $750-million debt offering with an 8.50 per cent coupon.
These articles are based on public sources deemed to be accurate. These articles are designed for information purposes and are not intended as a recommendation of the companies discussed. Individuals looking to invest in this sector should consult an investment advisor before proceeding.
Colin Cieszynski is an investment advisor at Canaccord Capital. Contact Colin at 416-867-4543; fax 416-879-7706; or email Colin_Cieszynski@canaccord.com.