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Higher recycled commodity prices and volumes within its Resource Solutions service are contributing to profitability at Casella Waste.
Photo by Recycling Today staff

Casella reports rising revenue, income

Waste and recycling firm sees its second quarter net income rise 51 percent year on year.

July 29, 2022

Casella Waste Systems Inc., based in Rutland, Vermont, has reported second-quarter revenue that rose by 31.4 percent compared with the second quarter of 2021 and net income that rose by 51 percent from a year earlier.

“We had a strong quarter, as our mature operating efficiency and pricing programs helped us to offset the impact of historically high inflation,” says John W. Casella, CEO and board chair. “Our core business is performing very well and driving growth, while our execution against our acquisition strategy has resulted in incremental growth."

The CEO says in the 12 months ending June 30, 2022, for the first time in the company’s history it exceeded $1.0 billion in annual revenue. John Casella says, “This is a true milestone for the company. I am proud of our continued execution and believe we have the right people and processes in place to continue delivering strong results over the remainder of the year.”

The company also has been busy in the acquisition market, the CEO says. “We continue to grow the business meaningfully through acquisitions. Year to date, we have closed on 11 strategic acquisitions with annualized revenue of approximately $47 million and continue to have a robust pipeline of opportunities. We remain disciplined in our approach and have the potential to close on additional deals this fiscal year.”

Regarding retaining profitability, John Casella says, "As we expected, our fuel cost recovery fees effectively helped to offset the impact of rising fuel costs in the quarter, while resulting in limited margin compression. Further, our nimble efforts to adjust our pricing programs early in the year resulted in a 7.7 percent increase in collection pricing and a 6.9 percent increase in solid waste pricing in the second quarter.”

Looking ahead, John Casella says, “Given our strong operating execution year-to-date and the expected positive contribution of acquisitions completed this year, we are updating fiscal year 2022 guidance ranges for the second time this year.”

He continues, “These guidance ranges assume a stable economic environment through the remainder of the year, including the current historically high inflationary environment. We expect our pricing, fuel cost recovery fees, and operating efficiency programs to allow us to outpace higher costs and drive margin expansion year over year.”

Breaking down its second quarter revenue stream, Casella Waste says growth was mainly driven by: the roll-over impact from acquisitions along with newly closed acquisitions; positive collection and disposal pricing; higher solid waste fuel cost recovery fees; higher solid waste volumes; higher recycled commodity prices; and higher pricing, fees and volumes within its Resource Solutions (waste audit and diversion guidance) operating segment.