Casella Waste Systems, Inc. Q1 FY2026 earnings call

• Team executed well across business, delivering solid financial results and margin expansion exceeding budget. - Disciplined pricing, core operations, and acquisitions positioned business. - Fuel recovery program offset fuel cost increase. - Safety initiatives advanced, TRIR improved 20% year over year. - Made progress in Mid-Atlantic integration, migrating customers to new system. - On track to cut $5 million of operating costs in 2026 and $10 million over next two years. - Investing in customer platforms for improved experience, including new payment portal and planned app rollout. - Focused on reducing G&A costs with $15 million in savings over three years. - Made permitting progress on landfill expansions. - Completed four acquisitions in 2026, adding ~$150 million of annualized revenues.

Revenues for the quarter were $457.3 million, up 9.6% year over year. Solid waste revenues were up 10% year over year, with price up 5.1% and volume down 2.5%. Landfill volumes overall were up 2.3% in the quarter. Resource solutions revenues were up 8% year-over-year, with recycling and other processing revenue down 2.7% impacted by lower commodity prices, and national accounts up 20.7%. Adjusted EBITDA increased 12.3% year-over-year, and margin expanded by 50 basis points. Adjusted net income was $12.8 million in the quarter, up $.6 million and one cent per share. Net cash provided by operating activities was $62.3 million, up 24% year-over-year. Adjusted free cash flow was $30.7 million, up 5% year over year.

Updated financial guidance for 2026: revenue range $2.06 to $2.08 billion (increase of $90 million), adjusted EBITDA range $473 to $483 million (increase of $18 million), adjusted free cash flow range $200 to $210 million (increase of $5 million). Guidance assumes adjusted EBITDA margins of ~20% and adjusted free cash flow with typical conversion from EBITDA.

Q: Adam Rubes of Goldman Sachs asked about cost reduction, margin expansion, closure of Ontario landfill, and landfill gas program.

A: Brad and Ned responded.

Q: Trevor Romero of William Blair asked about Star Waste's margin profile, integration, synergy opportunities, and national accounts.

A: Brad and Ned answered.

Q: Tyler Brown of Raymond James asked about landfill price acceleration, OnStar, Q2 margins, and ash landfill closure.

A: Ned and Brad replied.

Q: Jim Shum of TD Calendly asked about Northeast supply demand, landfill pricing, and Mid-Atlantic collection margins.

A: Ned and Brad answered.

Q: Tammy of JP Morgan asked about CPI impact on pricing.

A: Ned and Brad responded.

Q: Slow Mo Regenbaum of the Sawyer Lines asked about landfill pricing turnaround, rail impact, and rail vs transfer station costs.

A: Ned answered.

Q: Harold Anter of Jefferies asked about pricing, churn, and tech investment.

A: Brad answered.

Q: William Griffin asked about balancing leverage and M&A following Star Waste acquisition.

A: Ned answered.