Republic Services, Inc.

Good afternoon and welcome to the Republic Services Second Quarter 2021 Investor Conference Call. Republic Services is traded on the New York Stock Exchange under the symbol RSG. All participants in today's call will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your touchtone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to Stacey Matthews, Vice President of Investor Relations.

I would like to welcome everyone to Republic Services' second quarter 2021 conference call. John VanderArk, our CEO, and Brian DelGaccio, our CFO, are joining me as we discuss our performance. I would like to take a moment to remind everyone that some of the information we discuss on today's call contains forward-looking statements which involve risks and uncertainties and may be materially different from actual results. Our SEC filings discuss factors that could cause actual results to differ materially from expectations. The material that we discuss today is time sensitive. If in the future you listen to a rebroadcast or recording of this conference call, you should be sensitive to the date of the original call, which is July 29th, 2021. Please note that this call is the property of Republic Services, Inc. Any redistribution, retransmission, or rebroadcast of this call in any form without the express written consent of Republic Services is strictly prohibited. I want to point out that our SEC filings, our earnings press release, which includes GAAP reconciliation tables, and a discussion of business activities, along with a recording of this call, are all available on Republic's website at republicservices.com. I want to remind you that Republic's management team routinely participates in investor conferences. When events are scheduled, the dates, times, and presentations are posted on our website. With that, I would like to turn the call over to John.

Thanks, Stacey. Good afternoon, everyone, and thank you for joining us. We are very pleased with our strong performance in the second quarter. Our results reflect strong execution and continued momentum on our strategic priorities, which are building capabilities to further differentiate us from competitors. These capabilities include driving growth and building customer loyalty, through a maniacal focus on the customer, which we call Customer Zeal, leveraging digital tools to improve the experience for our customers and employees, which we believe drives growth and generates operational efficiencies, and prioritizing sustainability by offering environmentally responsible solutions to our customers while protecting the planet. During the second quarter, we delivered adjusted earnings per share of $1.09 which represents a 36% increase over the prior year, expanded EBITDA margin 110 basis points to 30.6%, and generated $1 billion of adjusted free cash flow on a year-to-date basis. We continue to effectively allocate capital by investing in value-creating acquisitions and returning excess cash to our shareholders. Year-to-date, we invested $567 million in acquisitions to further enhance our market position and increase free cash flow. Our pipeline of acquisition opportunities remains robust with opportunities in both solid waste and the environmental solutions portion of our business. We expect to invest well over $600 million in acquisitions for the full year. Year to date, we return $363 million to our shareholders through dividends and share repurchases and our board recently approved an 8% increase in the quarterly dividend. The strength of the underlying business is irrefutable, and we continue to see the proof points that our strategy is working. Retention on our small and large container business remains at historically high levels at 94%. If you further consider all permanent units of service, retention is even higher at 95%. As anticipated, the pricing environment was strong in the second quarter. Total core price was 5.2% and average yield was 2.6%. This level of core price matches the highest level in our company's history. During the second quarter, we delivered outsized growth in our business as the economy improved. Second quarter volume increased 8.1% compared to the prior year, which exceeded our expectations. The outlook for growth in the remainder of the year, both organically and through acquisitions, is strong. Turning to digital, we continue to see the benefits of our investments in technology and are well underway on the rollout of the next phase of our RISE platform. Through the second quarter, we implemented tablets in approximately 47% of our large and small container fleet. We expect to be substantially complete by the end of this year, with plans to further deploy to the residential fleet beginning in 2022. The in-cab tablets enable automated customer notifications, which provides customers real-time information about their service. Next, we believe sustainability is more than environmental stewardship, but also a platform for growth. We recently published our new sustainability report, which highlights the progress we are making on our most significant opportunities to positively impact our stakeholders and the environment. For example, we are proud to report a 5% reduction in operational greenhouse gas emissions in 2020 compared to the prior year. This year, we expanded and converted a landfill gas energy plant to high BTU and have 15 additional projects in the pipeline. These projects reduce landfill emissions, generate more renewable energy, and improve our economics. We are also making the communities in which we operate better places to live. So far this year, we've supported more than 25 charitable efforts and neighborhood revitalization projects through financial contributions and volunteer efforts. This is in addition to the ongoing support of our local divisions provide to their communities. In recognition of our ESG performance and transparency, we were named to 3BL Media's 100 Best Corporate Citizens list for the second consecutive year. Finally, turning to our outlook for the remainder of the year, we expect continued strength in our business and to exceed the full-year guidance we upwardly revised last quarter. Accordingly, we're updating full-year financial guidance as follows. Adjusted EPS is now expected to be in a range of $4 to $4.05, and adjusted free cash flow is now expected to be in a range of $1.45 billion to $1.475 billion. This represents an increase of over 6% from the midpoint of the prior guidance. I will now turn the call over to Brian.