Waste Management Inc. on Tuesday reported that its second-quarter profit fell 14 percent. Its adjusted profit topped analysts' expectations, but revenue fell short of Wall Street's view.
The Houston-based garbage and recycling hauler also announced that it is selling Wheelabrator Technologies Inc. to Energy Capital Partners for $1.94 billion. Wheelabrator owns or runs 17 waste-to-energy facilities and four independent power-producing plants in the U.S. as well as four landfills, three transfer stations and an ongoing development and construction project in the U.K.
President and CEO David Steiner said that Waste Management had suspended its stock buybacks in the first half of the year while talks to sell Wheelabrator were underway.
But he said Tuesday that since the proposed sale has been announced, the company is using an accelerated stock repurchase program to spend the full amount of its previously disclosed $600 million authorization on share buybacks over a maximum period of about six months.
For the period ended June 30, net income dropped to $210 million, or 45 cents per share, from $244 million, or 52 cents per share, in the same quarter a year earlier.
Earnings, excluding charges mostly tied to the sale of operations in Puerto Rico, were 60 cents per share. The average estimate of analysts surveyed by Zacks Investment Research was for earnings of 59 cents per share.
Waste Management posted revenue of $3.56 billion compared with $3.53 billion a year ago. Analysts expected higher revenue of $3.61 billion, according to Zacks.
Waste Management anticipates meeting or beating its full-year adjusted profit forecast of $2.30 to $2.35 per share. Analysts polled by FactSet expect $2.36 per share.
Its shares rose 80 cents, or 1.8 percent, to $44.69 in premarket trading Tuesday.