Waste Connections, Inc., Ontario, Canada, announced its results for the first quarter of 2018 on May 2. Revenue in the first quarter totaled $1.14 billion, up from $1.091 billion in the same period a year ago. Operating income was $188.7 million; this compares to $26.4 million in the same period a year ago, which included $141.7 million in non-cash impairments and other charges.
Net income attributable to Waste Connections in the first quarter was $124.9 million, or 47 cents per share on a diluted basis of 264.6 million shares. In the year ago period, the company reported net income attributable to Waste Connections of $14.9 million, or 6 cents per share on a diluted basis of 263.9 million shares. Shares and per share numbers reflect a three-for-two share split completed in June 2017.
Adjusted net income attributable to Waste Connections in the first quarter was $148.6 million, or 56 cents per share, versus $130.3 million, or 49 cents per share, in the prior year period. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in the first quarter was $356.9 million and 31.3 percent of revenue, as compared to adjusted EBITDA of $332.8 million and 30.5 percent of revenue in the prior year period. Adjusted net income attributable to Waste Connections, adjusted net income attributable to Waste Connections per diluted share and adjusted EBITDA, all non-GAAP measures, primarily exclude acquisition-related items and impairments and other operating items.
"Better than expected solid waste price growth and E&P waste activity drove strong performance in the period and position us well for the remainder of 2018. Adjusted EBITDA margins in the first quarter increased 80 basis points year-over-year in spite of both the precipitous decline in recycled fiber values and weather-related impacts across a majority of our operational footprint. We are extremely pleased that given the strong start to the year and our recent acquisitions, adjusted free cash flow is tracking to exceed our original outlook of $850 million for 2018," Waste Connections CEO Ronald Mittelstaedt says. "Moreover, as anticipated, we resumed our share repurchase program, opportunistically buying back approximately $42 million of shares in the first quarter."
Mittelstaedt added, "Acquisition activity is another bright spot for 2018. Year-to-date, we've signed or closed acquisitions with total annualized revenue of approximately $165 million, including three new market entries. Since our previous update in February, we acquired Right Away Disposal, an integrated provider of solid waste collection, recycling, transfer and disposal services in Arizona's fast-growing Pinal and Maricopa Counties, consisting of three collection operations, one recycling facility, two transfer stations and a municipal solid waste landfill. We also acquired the Heart of Florida Landfill in Central Florida, a municipal solid waste landfill that complements existing operations. And in early May, we signed a definitive agreement for a new market entry to acquire a provider of collection, recycling and transfer services with approximately $55 million of annualized revenue, expected to close in June. We are fortunate that the strength of our financial profile and free cash flow generation provide us with the flexibility to continually increase the return of capital to shareholders while funding an above average amount of acquisition activity."