Waste Connections, Inc. · TSX:WCN
Waste Connections — Merger or Acquisition (May 2016)
22 slides from Waste Connections's merger presentation, May 9, 2016
Slide 1: Investor Presentation May 2016
Investor Presentation May 2016
Slide 2: Safe Harbor and Forward-Looking Information
Safe Harbor and Forward - Looking Information This presentation contains forward - looking statements regarding our proposed merger with Progressive Waste Solutions Ltd . , a corporation organized under the laws of Canada (“Progressive”) (which includes “forward - looking information” within the mea
Slide 3: Additional Information and Where to Find It
Additional Information and Where to Find It 3 This communication may be deemed to be solicitation material in respect of the proposed transaction between Waste Connections and Progressive . In connection with the proposed transaction, Progressive, as the parent company that will result from the comb
Slide 4: Participants in the Solicitation of Votes
Participants in the Solicitation of Votes Waste Connections and its directors, executive officers and certain other members of management and employees may be deemed to be participants in the solicitation of proxies for i ts security holder approvals to be obtained for the proposed transaction. Info
Slide 5: WCN: Investment Highlights
5 WCN: INVESTMENT HIGHLIGHTS Third largest solid waste and leading oilfield waste company in the U.S. ~$10 billion enterprise value; $5 billion assets; 7,000 employees Differentiated strategy Only company focused on secondary and exclusive markets Well - positioned in cash generative E&P w
Slide 6: Our Differentiated Strategy
6 OUR DIFFERENTIATED STRATEGY Success in solid waste industry is driven by: Market selection Asset and contractual positioning Execution at the local level Our Focus: Exclusive markets Vertically integrated or non - integrated Competitive markets Secondary markets with high collectio
Slide 7: WCN: Current Footprint
7 Serving almost 3 million customers in 32 states WCN: CURRENT FOOTPRINT
Slide 8: Targeting Attractive Markets
8 TARGETING ATTRACTIVE MARKETS Integrated Operations Non - Integrated Operations Exclusive Markets: #1 EBITDA margin #1 EBIT margin #1 FCF margin #1 ROA #3 EBITDA margin #2(tie) EBIT margin #2 FCF margin #2 ROA Competitive Markets: #2 EBITDA margin #2(tie) EBIT margin #3 FCF margin #3 ROA #4 EBITDA
Slide 9: WCN: Comparative Metrics
9 WCN: COMPARATIVE METRICS 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 2013 2014 2015 Price Growth WM RSG WCN - 2.0% - 1.5% - 1.0% - 0.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 2013 2014 2015 Volume Growth WM RSG WCN ■ 2015 Price + Volume Growth: ■ Waste Connections => 4.8% ■ Republic Services => 2.0% ■ Waste Managem
Slide 10: WCN: Comparative Metrics (cont.)
10 WCN: COMPARATIVE METRICS (cont.) ■ 2015 EBITDA to Free Cash Flow Conversion: ■ Waste Connections => 48 % ■ Waste Management => 37% ■ Republic Services => 29% 22.0% 24.0% 26.0% 28.0% 30.0% 32.0% 34.0% 36.0% 2013 2014 2015 Adjusted EBITDA* as % of Revenues WM RSG WCN 4.0% 6.0% 8.0% 10.0% 12.0% 14.0
Slide 11: WCN: Financial Highlights
11 WCN: FINANCIAL HIGHLIGHTS $0 $50 $100 $150 $200 $250 $300 $350 $400 2011 2012 2013 2014 2015 2016e $ Millions Adjusted Free Cash Flow* FCF FCF as % of Revenue 25.0% 27.0% 29.0% 31.0% 33.0% 35.0% $250 $375 $500 $625 $750 2011 2012 2013 2014 2015 2016e $ Millions Adjusted EBITDA* EBITDA EBITDA as %
Slide 12: Q1 2016 Financial Highlights
12 Q1 2016 FINANCIAL HIGHLIGHTS Revenue: $514.7 million, in - line with our outlook Solid waste price + volume growth => 5.9% Volumes 90 bps better than expected Double - digit landfill tonnage increases Strong increases in commercial and roll - off collection activity Solid waste streng
Slide 13: Q2 2016 Trends
13 Q2 2016 TRENDS (as of April 28 th ) Timing of BIN closing in the period and transaction - related expenses will impact Q2 results Expect legacy WCN in Q2 to report: Solid waste price + volume growth of at least 4%; E&P waste - related revenue between $25 million and $30 million; Sequent
Slide 14: WCN + BIN: A Compelling Combination
14 WCN + BIN: A COMPELLING COMBINATION
Slide 15: Compelling for Shareholders
15 COMPELLING FOR SHAREHOLDERS Brings together complementary footprints under WCN’s proven management team with long - term record of shareholder value creation Retains WCN’s commitment to differentiated strategy Expect to divest 15% - 20% of BIN’s U.S. revenue to maintain WCN’s strategic diff
Slide 16: WCN + BIN Combination
16 Stock - for - stock combination ~70% owned by WCN stockholders; ~30% BIN shareholders Expect dual listing on NYSE and TSX under ticker symbol ‘WCN’ Stockholder meetings May 26 th ; closing expected as early as June 1 st Combined company to be led by current WCN management team Board t
Slide 17: Complementary Footprint
17 COMPLEMENTARY FOOTPRINT 17 Legend Corporate HQ Regional HQ/Office Collection Transfer Disposal / Landfill Recycling Intermodal E&P Transfer E&P Processing & Disposal
Slide 18: WCN: 10-Year Outperformance
18 WCN: 10 - YEAR OUTPERFORMANCE 18 As of 5/2/16 319% 125% 115% 0 100 200 300 400 500 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 WCN WM RSG S&P 500 S&P/TSX Composite Index 96% 51%
Slide 19: Non-GAAP Reconciliation Schedules
19 NON - GAAP RECONCILIATION SCHEDULES
Slide 20: Adjusted EBITDA
Adjusted EBITDA* 2011 2012 2013 2014 2015 2016e Net Income (loss) 166,171 159,660 196,005 233,327 (94,694) 241,245 Plus (less): Income tax provision (benefit) 106,958 105,443 124,916 152,335 (31,592) 156,055 Plus: Interest Expense 44,520 53,037 73,579 64,674 64,236 66,000 Plus: Depreciation and Amor
Slide 21: Adjusted Free Cash Flow
Adjusted Free Cash Flow* 2011 2012 2013 2014 2015 2016e Net cash provided by operating activities 388,170 416,327 484,061 545,077 576,999 596,700 Plus/Less: Change in book overdraft (227) 398 (110) (11) (89) - Plus: Proceeds from disposal of assets 4,434 2,741 11,019 9,421 2,883 - Plus: Excess tax b
Slide 22: Corporate Headquarters and Investor Relations
CORPORATE HEADQUARTERS 3 Waterway Square Place, Suite 110 The Woodlands, TX 77380 (832) 442 - 2200 http://wasteconnections.investorroom.com INVESTOR RELATIONS Worthing Jackman, EVP CFO Mary Anne Whitney, VP Finance Phone : (832) 442 - 2266 Phone : (832) 442 - 2253 worthingj@wasteconnections.com mary