Republic Services, Inc.

Good afternoon, and welcome to the Republic Services Third Quarter 2023 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 a 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 Aaron Evans, Vice President of Investor Relations.

Thank you. I would like to welcome everyone to our public services third quarter 2023 conference call. Don Van Der Ark, 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. It 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 reporting of this conference call, you should be sensitive to the date of the original call, which is October 26, 2023. Please note that this call is 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 gap reconciliation tables and a discussion of business activities, along with the recording of this call, are available on the 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'd like to turn the call over to John.

Thanks, Aaron. Good afternoon, everyone, and thank you for joining us. Our strong third quarter results reflect our focus on profitably growing the business. We produce revenue growth both organically and through acquisitions while generating healthy margin expansion across our business. During the quarter, we delivered revenue growth of 6%, including 2% from acquisitions, generated adjusted EBITDA growth of 9%, expanded EBITDA margin by 70 basis points, reported adjusted earnings per share of $1.54, and produced $1.8 billion of adjusted pre-cash flow on the year-to-date basis. We continue to effectively allocate capital by investing in acquisitions to create long-term value. Year-to-date, we have invested $947 million in acquisitions. All transactions were in the recycling and waste space. The M&A environment remains active with opportunities in both the recycling and waste and environmental solutions businesses. We remain confident that we will exceed $1 billion of investment for the year. Year-to-date, we returned $671 million to our shareholders through dividends and share repurchases. This includes $201 million of share repurchases completed during the third quarter as our leverage ratio returned to target levels. We continue to make progress demonstrating the value of our complete set of products and offerings to customers while increasing the profitability of our environmental solutions business. Pricing realization in the environmental solutions business remains strong, and we continue to drive organic growth through cross-selling. EBITDA margin in the environmental solutions business improved sequentially to 22.7% in the third quarter, and expanded 390 basis points over the prior year. The results we are delivering are made possible by executing our strategy in support of our differentiated capabilities. Regarding customer zeal, our efforts to deliver industry-leading service continues to drive sustained customer loyalty and organic growth in the business. Our customer retention rate remained over 94%, and we continue to see favorable trends and our Net Promoter Score, supported by our valuable service offerings and quality service delivery. Organic revenue growth remained strong during the quarter, with simultaneous increases in both price and volume. Core price on related revenue was 8.6%, and average yield on related revenue was 7.2%, and organic volume growth on related revenue was 10 basis points. Turning to our digital capabilities, the team continues to advance the implementation of digital tools that improve the experience for both customers and employees. The next phase of our digital operations is expected to drive additional productivity savings through route optimization, further improve safety performance, and provide more predictable service delivery to our customers. For example, we now have the ability to provide real-time customer notifications regarding expected service time on a given day. We are in the early stages of deploying advanced technology on select recycling collection routes. The platform utilizes cameras to identify contamination in recycling containers. We expect this technology will reduce contamination over time and drive incremental revenue. Moving on to sustainability. We believe that our sustainability innovation investments in areas such as plastic circularity, and renewable natural gas are a platform for profitable growth. Development of our polymer centers remains on track. Construction of our Las Vegas polymer center is substantially complete, and we expect full-scale operations to begin in November. Our Midwest polymer center will be located in Indianapolis. This center will be co-located with a blue polymers production facility, with operations expected to begin in late 2024. the renewable natural gas projects being co-developed with our partners are continuing to advance. Five projects were online by the end of the third quarter, and we expect eight additional projects to be completed in 2024. We are making progress in our efforts to reduce greenhouse gas emissions, including our industry-leading commitment to fleet electrification. We expect to have 12 electric vehicles in operation by year-end, and more than 60 EVs to be added to our recycling and waste collection fleet in 2024. We now have six facilities with commercial EV charging infrastructure with more than 40 additional sites in various stages of development. We continue to be recognized as an employer of choice and are proud to be certified as a great place to work for the seventh consecutive year. Our team members remain highly engaged to ensure that we are delivering high-quality essential service that are valued by our customers. I now turn the call over to Brian to provide more details for the quarter.