Republic Services reports 5.6 percent total revenue growth in Q4 to close out strong year

Republic Services, Inc. reported a net income of $512 million, or $1.63 per diluted share, for the three months ending on December 31, 2024, versus $440 million, or $1.39 per diluted share, for the comparable 2023 period. Excluding certain expenses and other items, on an adjusted basis, net income for the three months ended December 31, 2024, was $497 million, or $1.58 per diluted share, versus $446 million, or $1.41 per diluted share, for the comparable 2023 period.

Fourth-quarter 2024 highlights: 

• Total revenue growth of 5.6 percent includes 4.3 percent organic growth and 1.3 percent growth from acquisitions.

• Core price on total revenue increased revenue by 6.1 percent. Core price on related business revenue increased by 7.3 percent, which consisted of 9.1 percent in the open market and 4.5 percent in the restricted portion of the business.

• Revenue growth from average yield on total revenue was 4.4 percent, and volume decreased revenue by 1.2 percent. Revenue growth from average yield on related business revenue was 5.3 percent, and volume decreased related business revenue by 1.5 percent.

• Net income was $512 million, or a margin of 12.7 percent.

• EPS was $1.63 per share, an increase of 17.3 percent over the prior year.

• Adjusted EPS, a non-GAAP measure, was $1.58 per share, an increase of 12.1 percent over the prior year.

• Adjusted EBITDA, a non-GAAP measure, was $1.25 billion, and adjusted EBITDA margin, a non-GAAP measure, was 31.0 percent of revenue, an increase of 110 basis points over the prior year.

• The company's average recycled commodity price per ton sold at the recycling centers during the fourth quarter was $153. This represents an increase of $22 per ton over the prior year.

• The company completed and commenced operations on two renewable natural gas projects during the quarter.

"We delivered another strong year of results in 2024, made possible by effectively executing our strategy designed to meet the needs of our customers and profitably grow the business. We exceeded expectations and generated double-digit growth in EBITDA, earnings, and free cash flow, and expanded adjusted EBITDA margin by 140 basis points during the year," said Jon Vander Ark, president and chief executive officer. "We continued to make investments across our business that support our differentiated capabilities and returned nearly $1.2 billion to shareholders through dividends and share repurchases."

Full-year 2024 highlights: 

• Total revenue growth of 7.1 percent includes 4.5 percent organic growth and 2.6 percent growth from acquisitions.

• The core price on total revenue increased by 6.5 percent. Core price on related business revenue increased by 7.8 percent, 9.5 percent in the open market, and 5.1 percent in the restricted portion of the business.

• Revenue growth from average yield on total revenue was 5.1 percent, and volume decreased revenue by 1.1 percent. Revenue growth from average yield on related business revenue was 6.2 percent, and volume decreased related business revenue by 1.3 percent.

• Net income was $2.04 billion, or a margin of 12.7 percent.

• EPS was $6.49 per share, an increase of 18.6 percent over the prior year.

• Adjusted EPS, a non-GAAP measure, was $6.46 per share, an increase of 15.2 percent over the prior year.

• Adjusted EBITDA, a non-GAAP measure, was $4.98 billion, and adjusted EBITDA margin, a non-GAAP measure, was 31.1 percent of revenue, an increase of 140 basis points over the prior year.

• Cash provided by operating activities was $3.94 billion, an increase of 8.8 percent over the prior year.

• Adjusted free cash flow, a non-GAAP measure, was $2.18 billion, an increase of 10.0 percent versus the prior year.

• Cash invested in acquisitions, including an investment in a post-collection business, was $358 million.

• Six renewable natural gas projects were completed and commenced operations during the year.

• Republic commenced operations at their first Polymer Center in Las Vegas and completed construction at the Polymer Center in Indianapolis.

• The cash returned to shareholders was $1.18 billion, which included $490 million of share repurchases and $687 million of dividends paid.

• The company's average recycled commodity price per ton sold during the year was $164. This represents an increase of $47 per ton over the prior year.

2025 Financial Guidance

Republic's financial guidance is based on current economic conditions and does not assume any significant changes in the overall economy in 2025. The financial guidance also includes the expected contribution from acquisitions that have closed to date.

Full-year 2025 financial guidance is as follows:

Revenue: Republic expects revenue to be in the range of $16.850 billion to $16.950 billion. The company expects growth from the average yield on total revenue to be approximately 4 percent and the average yield on related revenue to be approximately 5 percent. The company expects the impact from volume on total revenue to be in the range of (0.25) percent to 0.25 percent.

Adjusted EBITDA: Republic expects adjusted EBITDA to be in the range of $5.275 billion to $5.325 billion.

Adjusted diluted earnings per share: The company expects adjusted diluted earnings per share to be in the range of $6.82 to $6.90.

Adjusted free cash flow: Republic expects adjusted free cash flow to be in the range of $2.320 billion to $2.360 billion. The company expects to receive between $1.860 billion to $1.900 billion of property and equipment, net of proceeds from the sale of property and equipment.

Acquisitions: Republic expects to invest approximately $1 billion in acquisitions in 2025.

"We expect to deliver another strong year of profitable growth in 2025," said Mr. Vander Ark. "Our outlook is supported by pricing in excess of cost inflation, continued contribution from acquisitions, productivity enhancements from our digital tools, and investments in sustainability innovation to drive long-term value creation."