Waste Management Inc, the largest U.S. trash hauler, posted a 29 percent drop in quarterly profit hurt by volume declines in its industrial collection, transfer and recycling businesses and forecast a weaker 2009 for those businesses.

The Houston-based company also said it would restructure its field operations by consolidation, reduce its market areas to 25 from 45 and eliminate duplicative functions.

As part of a restructuring program costing $50 million, the company said it would eliminate pay hikes for its salaried staff. Fourth-quarter net income fell to $218 million, or 44 cents a share, from $309 million, or 61 cents a share, a year ago.

Revenue fell 7 percent to $3.11 billion, a shade below analysts expectation of $3.16 billion.

The company said it expects to achieve 2009 free cash flow of $1.3 billion to $1.4 billion through pricing, expense control and capital discipline.

Shares of the company closed up 15 cents at $28.45 Wednesday on the New York Stock Exchange.