Waste Connections, Inc.

Welcome to the Waste Connections 3rd Quarter 2020 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press the 1 followed by the 4 on your telephone. If at any time during the conference you need to reach an operator, please press star 0. As a reminder, this conference is being recorded Thursday, October 29th, 2020. I would now like to turn the conference over to Worthing Jackman, President and CEO. Please go ahead.

Great. Thank you, Operator. Good morning. I'd like to welcome everyone to this conference call to discuss our third quarter results and our outlook for Q4 and to provide some early thoughts for 2021. I'm joined this morning, safely distanced, by Mary Anne Whitney, our CFO. As noted in our earnings release, sequential improvement in solid waste volumes and increased recovered commodity values drove better-than-expected results in the third quarter and provide incremental momentum going forward. We believe our strong operating results, financial performance, and frontline support continue to differentiate Waste Connections during this year's unprecedented health, economic, and social challenges. Higher margin flow-through from improving revenues during the quarter provided better-than-expected adjusted EBITDA margin and adjusted free cash flow generation. Adjusted EBITDA as a percentage of revenue in the period was approximately 40 basis points above our outlook in spite of 30 basis points higher-than-expected discretionary front-line and incentive compensation costs impacting the quarter, which resulted from our more than $35 million commitment in incremental costs primarily directed discretionary supplemental pay for frontline employees. Solid waste margins expanded by almost 200 basis points compared to the year-ago period, with collection, transfer, and disposal accounting for 80% of that increase. Moreover, year-to-date adjusted free cash flow of $778 million, or 19.2% of revenue, increased year-over-year. putting us firmly on track to exceed the adjusted free cash flow outlook for the full year that we communicated in August and positioning us for double digit growth in adjusted free cash flow in 2021. Before we get into much more detail, let me turn the call over to Mary Anne for our forward looking disclaimer and other housekeeping items.

Thank you Worthing and good morning. The discussion during today's call includes forward-looking statements made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including forward-looking information within the meeting of applicable Canadian securities laws. Actual results could differ materially from those made in such forward-looking statements due to various risks and uncertainties. Factors that could cause actual results to differ are discussed both in the cautionary statement included in our October 28th earnings release and in greater detail in Waste Connections filings for the U.S. Securities and Exchange Commission and the Securities Commission's or similar regulatory authorities in Canada. You should not place undue reliance on forward-looking statements, as there may be additional risks of which we are not presently aware or that we currently believe are immaterial, which could have an adverse impact on our business. We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances that may change after today's meeting. On the call, we will discuss non-GAAP measures such as adjusted EBITDA, adjusted net income attributable to Ways Connections on both a dollar basis and per diluted share, and adjusted free cash flow. Please refer to our earnings releases for reconciliation of such non-GAAP measures to the most comparable GAAP measure. Management uses certain non-GAAP measures to evaluate and monitor the ongoing financial performance of our operations. Other companies may calculate these non-GAAP measures differently. I will now turn the call back over to Worthing.