GFL Environmental, Inc. Q1 FY2024 earnings call

• First quarter results better than guided, positive momentum expected to continue. • 7.7% like-for-like pricing, confident in meeting/ exceeding price guidance. • Labor turnover improving, R&M costs moderating. • Volume growth negative 3% but better than expectations. • Deployed $62 million into growth investments in Q1, on track to deploy $250M-$300M full year. • $500 million into 6 acquisitions since年初, largest in Central Florida. • Increased 2024 adjusted EBITDA guidance to $2.23 billion.

Revenue for the quarter was $1.8 billion, 6.5% higher than the prior year excluding Solid Waste divestitures. Solid Waste adjusted EBITDA margins saw underlying expansion of 100 basis points, 50 basis points better than planned. Environmental Services segment had over 10% top line revenue growth, though impacted by weather and other headwinds. Adjusted free cash flow for the quarter was $49 million, an increase of nearly $100 million over the prior year period.

• Increased 2024 adjusted EBITDA guidance to $2.23 billion. • Q2 guidance: Consolidated revenue ~$2.055B, Solid waste revenues $1.56B-$1.57B, Environmental Services $475M-$500M. • Adjusted EBITDA for Q2 $585M-$590M, adjusted free cash flow ~$160M-$170M. • Net leverage expected to step up in Q2 then ratably step down, adjusted net income ~$100M for Q2.

• Weather impacts on volume variability. • Commodity price fluctuations affecting upside vs guidance. • Labor turnover still having room for improvement. • Regulatory uncertainties related to EPR and other environmental regulations.

Q: Update on EPR and timing?

A: Selected as preferred vendor for Toronto recycling contract negotiations, expect update on Q2 call.

Q: M&A spend rest of year?

A: Spent ~$500M YTD, ~$100M-$150M left, to trickle into later Q2, Q3, Q4.

Q: Labor turnover improvement?

A: Voluntary turnover trended from ~30% pre-COVID to low 20s, heading in right direction.

Q: Landfill gas contracts?

A: Voluntary market prices trending up, some facilities to enter longer-term contracts.

Q: Working capital outlook?

A: Still growing but less use than before due to better management, with stability allowing optimization.