Tags: RSG | Republic | economy | stocks

Republic Services Steady with Economy

By    |   Friday, 29 Jul 2011 10:58 AM

Controlling costs and streamlining operations are winning business practices in good times and in bad. Sounds obvious, but many businesses fail. Focusing on operational efficiency is helping waste-management firm Republic Services (RSG) please Wall Street.

Revenue for the second quarter hit $2.1 billion, up 1 percent on the year. Net income came to $46.5 million, or 12 cents per diluted share, from $159.7 million, or 42 cents, for the same period a year earlier.

"The business continues to track to our expectations. The company's performance is a direct result of continued focus on pricing, productivity improvements and customer service. This is the fifth quarter in a row we have seen improvement in our collection volumes. We are confident in reaffirming our guidance, "says Donald W. Slager, President and Chief Executive Officer of Republic Services.

The company also conducted financial housekeeping. “We remain committed to a consistent cash utilization strategy that includes both dividend growth and share repurchase,” Slager says.

Moody's Investors Service is happy just upped Republic's debt ratings outlook to positive from stable based on expectations for healthy earnings and cash flow to come.

Tied to the economy

An improving economy is helping as well. "Republic is well positioned to capitalize on waste stream growth that will likely emerge as the economic recovery progresses," Moody's analysts write in a statement on the company.

"We expect fundamentals in the solid waste sector to improve with an expanding U.S. economy, and that Republic's financial leverage will moderate while interest coverage metrics and cash flow generation strengthen,” they write

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Controlling costs and streamlining operations are winning business practices in good times and in bad. Sounds obvious, but many businesses fail. Focusing on operational efficiency is helping waste-management firm Republic Services (RSG) please Wall Street. Revenue for the...
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2011-58-29
Friday, 29 Jul 2011 10:58 AM
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