Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 22, 2021 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2021 | |
Entity File Number | 1-12154 | |
Entity Registrant Name | Waste Management, Inc | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 73-1309529 | |
Entity Address, Address Line One | 800 Capitol Street | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77002 | |
City Area Code | 713 | |
Local Phone Number | 512-6200 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | WM | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 422,127,260 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0000823768 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 476 | $ 553 |
Accounts receivable, net of allowance for doubtful accounts of $28 and $33, respectively | 2,025 | 2,097 |
Other receivables, net of allowance for doubtful accounts of $11 and $7, respectively | 402 | 527 |
Parts and supplies | 124 | 124 |
Other assets | 300 | 239 |
Total current assets | 3,327 | 3,540 |
Property and equipment, net of accumulated depreciation and amortization of $19,647 and $19,337, respectively | 14,038 | 14,148 |
Goodwill | 8,980 | 8,994 |
Other intangible assets, net | 990 | 1,024 |
Restricted trust and escrow accounts | 448 | 347 |
Investments in unconsolidated entities | 426 | 426 |
Other assets | 861 | 866 |
Total assets | 29,070 | 29,345 |
Current liabilities: | ||
Accounts payable | 1,212 | 1,121 |
Accrued liabilities | 1,281 | 1,342 |
Deferred revenues | 548 | 539 |
Current portion of long-term debt | 244 | 551 |
Total current liabilities | 3,285 | 3,553 |
Long-term debt, less current portion | 13,244 | 13,259 |
Deferred income taxes | 1,805 | 1,806 |
Landfill and environmental remediation liabilities | 2,262 | 2,222 |
Other liabilities | 1,045 | 1,051 |
Total liabilities | 21,641 | 21,891 |
Commitments and contingencies | ||
Waste Management, Inc. stockholders' equity: | ||
Common stock, $0.01 par value; 1,500,000,000 shares authorized; 630,282,461 shares issued | 6 | 6 |
Additional paid-in capital | 5,071 | 5,129 |
Retained earnings | 11,337 | 11,159 |
Accumulated other comprehensive income (loss) | 48 | 39 |
Treasury stock at cost, 208,200,661 and 207,480,827 shares, respectively | (9,035) | (8,881) |
Total Waste Management, Inc. stockholders' equity | 7,427 | 7,452 |
Noncontrolling interests | 2 | 2 |
Total equity | 7,429 | 7,454 |
Total liabilities and equity | $ 29,070 | $ 29,345 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
CONSOLIDATED BALANCE SHEETS | ||
Allowance for doubtful accounts | $ 28 | $ 33 |
Allowance for other receivables | 11 | 7 |
Accumulated depreciation and amortization | $ 19,647 | $ 19,337 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued | 630,282,461 | 630,282,461 |
Treasury stock, shares | 208,200,661 | 207,480,827 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Operating revenues | $ 4,112 | $ 3,729 |
Costs and expenses: | ||
Operating | 2,514 | 2,329 |
Selling, general and administrative | 458 | 425 |
Depreciation and amortization | 472 | 402 |
Restructuring | 1 | |
(Gain) loss from divestitures, asset impairments and unusual items, net | 17 | |
Total costs and expenses | 3,462 | 3,156 |
Income from operations | 650 | 573 |
Other income (expense): | ||
Interest expense, net | (97) | (112) |
Equity in net losses of unconsolidated entities | (9) | (26) |
Other, net | 1 | |
Total other income (expense) | (105) | (138) |
Income before income taxes | 545 | 435 |
Income tax expense | 124 | 74 |
Consolidated net income | 421 | 361 |
Net income attributable to Waste Management, Inc. | $ 421 | $ 361 |
Basic earnings per common share | $ 1 | $ 0.85 |
Diluted earnings per common share | $ 0.99 | $ 0.85 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Consolidated net income | $ 421 | $ 361 |
Other comprehensive income (loss), net of tax: | ||
Derivative instruments, net | 1 | 2 |
Available-for-sale securities, net | (5) | (9) |
Foreign currency translation adjustments | 13 | (76) |
Other comprehensive income (loss), net of tax | 9 | (83) |
Comprehensive income | 430 | 278 |
Comprehensive income attributable to Waste Management, Inc. | $ 430 | $ 278 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Consolidated net income | $ 421 | $ 361 |
Adjustments to reconcile consolidated net income to net cash provided by operating activities: | ||
Depreciation and amortization | 472 | 402 |
Deferred income tax benefit | (14) | (4) |
Interest accretion on landfill liabilities | 26 | 24 |
Provision for bad debts | 11 | 14 |
Equity-based compensation expense | 23 | 13 |
Net gain on disposal of assets | (9) | (3) |
Loss from divestitures, asset impairments and other, net | 17 | 7 |
Equity in net losses of unconsolidated entities, net of dividends | 9 | 19 |
Change in operating assets and liabilities, net of effects of acquisitions and divestitures: | ||
Receivables | 199 | 127 |
Other current assets | (1) | (10) |
Other assets | 7 | 1 |
Accounts payable and accrued liabilities | (2) | (123) |
Deferred revenues and other liabilities | (39) | (63) |
Net cash provided by operating activities | 1,120 | 765 |
Cash flows from investing activities: | ||
Acquisitions of businesses, net of cash acquired | (7) | (1) |
Capital expenditures | (270) | (459) |
Proceeds from divestitures of businesses and other assets (net of cash divested) | 15 | 12 |
Other, net | (72) | (55) |
Net cash used in investing activities | (334) | (503) |
Cash flows from financing activities: | ||
Debt repayments | (49) | (25) |
Commercial paper repayments | (280) | |
Common stock repurchase program | (250) | (402) |
Cash dividends | (247) | (236) |
Exercise of common stock options | 17 | 31 |
Tax payments associated with equity-based compensation transactions | (28) | (33) |
Other, net | 7 | (3) |
Net cash used in financing activities | (830) | (668) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents | 2 | (4) |
Decrease in cash, cash equivalents and restricted cash and cash equivalents | (42) | (410) |
Cash, cash equivalents and restricted cash and cash equivalents at beginning of period | 648 | 3,647 |
Cash, cash equivalents and restricted cash and cash equivalents at end of period | $ 606 | $ 3,237 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2021 | Mar. 31, 2020 |
Reconciliation of cash, cash equivalents and restricted cash and cash equivalents at end of period: | ||
Cash and cash equivalents | $ 476 | $ 3,125 |
Restricted cash and cash equivalents included in other current assets | 60 | 40 |
Restricted cash and cash equivalents included in restricted trust and escrow accounts | 70 | 72 |
Cash, cash equivalents and restricted cash and cash equivalents at end of period | $ 606 | $ 3,237 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) shares in Thousands, $ in Millions | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member]Cumulative Effect, Period of Adoption, Adjustment [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Stock [Member] | Noncontrolling Interests [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | Total |
Beginning balance at Dec. 31, 2019 | $ 6 | $ 5,049 | $ (2) | $ 10,592 | $ (8) | $ (8,571) | $ 2 | $ (2) | $ 7,070 |
Beginning balance, shares at Dec. 31, 2019 | 630,282 | (205,956) | |||||||
Equity roll forward | |||||||||
Consolidated net income | 361 | 361 | |||||||
Other comprehensive income (loss), net of tax | (83) | (83) | |||||||
Cash dividends declared | (236) | (236) | |||||||
Equity-based compensation transactions, net of tax | (23) | 3 | $ 57 | 37 | |||||
Equity-based compensation transactions, net | 1,355 | ||||||||
Common stock repurchase program | $ (402) | (402) | |||||||
Common stock repurchase program, shares | (3,687) | ||||||||
Other, net, shares | 1 | ||||||||
Ending balance at Mar. 31, 2020 | $ 6 | 5,026 | 10,718 | (91) | $ (8,916) | 2 | 6,745 | ||
Ending balance, shares at Mar. 31, 2020 | 630,282 | (208,287) | |||||||
Beginning balance at Dec. 31, 2020 | $ 6 | 5,129 | 11,159 | 39 | $ (8,881) | 2 | 7,454 | ||
Beginning balance, shares at Dec. 31, 2020 | 630,282 | (207,481) | |||||||
Equity roll forward | |||||||||
Consolidated net income | 421 | 421 | |||||||
Other comprehensive income (loss), net of tax | 9 | 9 | |||||||
Cash dividends declared | (247) | (247) | |||||||
Equity-based compensation transactions, net of tax | (8) | 4 | $ 46 | 42 | |||||
Equity-based compensation transactions, net | 1,089 | ||||||||
Common stock repurchase program | (50) | $ (200) | (250) | ||||||
Common stock repurchase program, shares | (1,809) | ||||||||
Ending balance at Mar. 31, 2021 | $ 6 | $ 5,071 | $ 11,337 | $ 48 | $ (9,035) | $ 2 | $ 7,429 | ||
Ending balance, shares at Mar. 31, 2021 | 630,282 | (208,201) |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||
Cash dividends declared per common share | $ 0.575 | $ 0.545 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Basis of Presentation | |
Basis of Presentation | 1. Basis of Presentation The financial statements presented in this report represent the consolidation of Waste Management, Inc., a Delaware corporation; its wholly-owned and majority-owned subsidiaries; and certain variable interest entities for which Waste Management, Inc. or its subsidiaries are the primary beneficiaries as described in Note 13. Waste Management, Inc. is a holding company and all operations are conducted by its subsidiaries. When the terms “the Company,” “we,” “us” or “our” are used in this document, those terms refer to Waste Management, Inc., its consolidated subsidiaries and consolidated variable interest entities. When we use the term “WM,” we are referring only to Waste Management, Inc., the parent holding company. We are North America’s leading provider of comprehensive waste management environmental services, providing services throughout the United States (“U.S.”) and Canada. We partner with our residential, commercial, industrial and municipal customers and the communities we serve to manage and reduce waste at each stage from collection to disposal, while recovering valuable resources and creating clean, renewable energy. Our “Solid Waste” business is operated and managed locally by our subsidiaries that focus on distinct geographic areas and provide collection, transfer, disposal, and recycling and resource recovery services. Through our subsidiaries, we are also a leading developer, operator and owner of landfill gas-to-energy facilities in the U.S. We evaluate, oversee and manage the financial performance of our Solid Waste business subsidiaries through our 17 Areas. On October 30, 2020, we acquired Advanced Disposal Services, Inc. (“Advanced Disposal”), the operations of which are presented in this report within our existing Solid Waste tiers. We also provide additional services that are not managed through our Solid Waste business, which are presented in this report as “Other.” Additional information related to our segments and our acquisition of Advanced Disposal are included in Notes 7 and 8, respectively. The Condensed Consolidated Financial Statements as of March 31, 2021 and for the three months ended March 31, 2021 and 2020 are unaudited. In the opinion of management, these financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, comprehensive income, cash flows, and changes in equity for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The financial statements presented herein should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. In preparing our financial statements, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with precision from available data or simply cannot be calculated. In some cases, these estimates are difficult to determine, and we must exercise significant judgment. In preparing our financial statements, the most difficult, subjective and complex estimates and the assumptions that present the greatest amount of uncertainty relate to our accounting for landfills, environmental remediation liabilities, long-lived asset impairments, the fair value of assets and liabilities acquired in business combinations or asset acquisitions and reserves associated with our insured and self-insured claims. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements. Revenue Recognition We generally recognize revenue as services are performed or products are delivered. For example, revenue typically is recognized as waste is collected, tons are received at our landfills or transfer stations, or recycling commodities are collected or delivered as product. We bill for certain services prior to performance. Such services include, among others, certain commercial and residential contracts, and equipment rentals. These advance billings are included in deferred revenues and recognized as revenue in the period service is provided. Substantially all our deferred revenues during the reported periods are realized as revenues within one Contract Acquisition Costs Our incremental direct costs of obtaining a contract, which consist primarily of sales incentives, are generally deferred and amortized to selling, general and administrative expense over the estimated life of the relevant customer relationship, ranging from five As of March 31, 2021 and December 31, 2020, we had $165 million and $159 million, respectively, of deferred contract costs, of which $119 million and $118 million, respectively, was related to deferred sales incentives. For the three months ended March 31, 2021 and 2020, amortization of our sales incentives was not material to our results of operations. Leases Amounts for our operating lease right-of-use assets are recorded in long-term other assets in our Condensed Consolidated Balance Sheets. The current and long-term portion of our operating lease liabilities are reflected in accrued liabilities and other long-term liabilities, respectively, in our Condensed Consolidated Balance Sheets. Amounts for our financing leases are recorded in property and equipment, net of accumulated depreciation, and current or long-term debt in our Condensed Consolidated Balance Sheets, as appropriate. Concentrations of Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments held within our restricted trust and escrow accounts, and accounts receivable. We make efforts to control our exposure to credit risk associated with these instruments by (i) placing our assets and other financial interests with a diverse group of credit-worthy financial institutions; (ii) holding high-quality financial instruments while limiting investments in any one instrument and (iii) maintaining strict policies over credit extension that include credit evaluations, credit limits and monitoring procedures, although generally we do not have collateral requirements for credit extensions. We also control our exposure associated with trade receivables by discontinuing service, to the extent allowable, to non-paying customers. However, our overall credit risk associated with trade receivables is limited due to the large number and diversity of customers we serve. Reclassifications When necessary, reclassifications have been made to our prior period financial information to conform to the current year presentation and are not material to our consolidated financial statements. Our prior year accumulated depreciation and gross property and equipment as of December 31, 2020 were overstated and have been corrected in our current year presentation. |
Landfill and Environmental Reme
Landfill and Environmental Remediation Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Landfill and Environmental Remediation Liabilities | |
Landfill and Environmental Remediation Liabilities | 2. Landfill and Environmental Remediation Liabilities Liabilities for landfill and environmental remediation costs are presented in the table below (in millions): March 31, 2021 December 31, 2020 Environmental Environmental Landfill Remediation Total Landfill Remediation Total Current (in accrued liabilities) $ 130 $ 25 $ 155 $ 138 $ 26 $ 164 Long-term 2,069 193 2,262 2,018 204 2,222 $ 2,199 $ 218 $ 2,417 $ 2,156 $ 230 $ 2,386 The changes to landfill and environmental remediation liabilities for the three months ended March 31, 2021 are reflected in the table below (in millions): Environmental Landfill Remediation December 31, 2020 $ 2,156 $ 230 Obligations incurred and capitalized 26 — Obligations settled (16) (5) Interest accretion 26 — Revisions in estimates and interest rate assumptions 7 (7) Acquisitions, divestitures and other adjustments — — March 31, 2021 $ 2,199 $ 218 At several of our landfills, we provide financial assurance by depositing cash into restricted trust funds or escrow accounts for purposes of settling final capping, closure, post-closure and environmental remediation obligations. Generally, these trust funds are established to comply with statutory requirements and operating agreements. See Note 13 for additional information related to these trusts. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt | |
Debt | 3. Debt The following table summarizes the major components of debt as of each balance sheet date (in millions) and provides the maturities and interest rate ranges of each major category as of March 31, 2021: March 31, December 31, 2021 2020 Commercial paper program (weighted average interest rate of 0.4% as of March 31, 2021 and December 31, 2020) $ 1,534 $ 1,814 Senior notes, maturing through 2050, interest rates ranging from 0.75% to 7.75% (weighted average interest rate of 3.3% as of March 31, 2021 and December 31, 2020) 8,465 8,465 Canadian senior notes, C$500 million maturing September 2026, interest rate of 2.6% 398 393 Tax-exempt bonds, maturing through 2048, fixed and variable interest rates ranging from 0.1% to 4.3% (weighted average interest rate of 1.7% as of March 31, 2021 and December 31, 2020) 2,547 2,571 Financing leases and other, maturing through 2085, weighted average interest rate of 4.6% (a) 627 652 Debt issuance costs, discounts and other (83) (85) 13,488 13,810 Current portion of long-term debt 244 551 $ 13,244 $ 13,259 (a) Excluding our landfill financing leases, the maturities of our financing leases and other debt obligations extend through 2059. Debt Classification As of March 31, 2021, we had approximately $3.0 billion of debt maturing within the next 12 months, including (i) $1.5 billion of short-term borrowings under our commercial paper program; (ii) $1.2 billion of tax-exempt bonds with term interest rate periods that expire within the next 12 months, which is prior to their scheduled maturities, and (iii) $213 million of other debt with scheduled maturities within the next 12 months, including $103 million of tax-exempt bonds. As of March 31, 2021, we have classified $2.7 billion of debt maturing in the next 12 months as long-term because we have the intent and ability to refinance these borrowings on a long-term basis as supported by the forecasted available capacity under our $3.5 billion long-term U.S. and Canadian revolving credit facility (“$3.5 billion revolving credit facility”), as discussed below. The remaining $244 million of debt maturing in the next 12 months is classified as current obligations. As of March 31, 2021, we also had $54 million of variable-rate tax-exempt bonds with long-term scheduled maturities supported by letters of credit under our $3.5 billion revolving credit facility. The interest rates on our variable-rate tax-exempt bonds are generally reset on either a daily or weekly basis through a remarketing process. All recent tax-exempt bond remarketings have successfully placed Company bonds with investors at market-driven rates and we currently expect future remarketings to be successful. However, if the remarketing agent is unable to remarket our bonds, the remarketing agent can put the bonds to us. In the event of a failed remarketing, we have the availability under our $3.5 billion revolving credit facility to fund these bonds until they are remarketed successfully. Accordingly, we have classified the $54 million of variable-rate tax-exempt bonds with maturities of more than one year as long-term in our Condensed Consolidated Balance Sheet as of March 31, 2021. Access to and Utilization of Credit Facilities and Commercial Paper Program $3.5 Billion Revolving Credit Facility — Commercial Paper Program Other Letter of Credit Lines — Debt Repayments Commercial Paper Program — Tax-Exempt Bonds — Financing Leases and Other . |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Taxes | |
Income Taxes | 4. Income Taxes Our effective income tax rate was 22.7% and 17.0% for the three months ended March 31, 2021 and 2020, respectively. The increase in our effective income tax rate when comparing the three months ended March 31, 2021 and 2020 was primarily driven by (i) a decrease in excess tax benefits associated with equity-based compensation; (ii) lower federal tax credits and (iii) favorable adjustments to accruals and related deferred taxes recorded in 2020. These items are discussed further below. We evaluate our effective income tax rate at each interim period and adjust it as facts and circumstances warrant. Equity-Based Compensation Investments Qualifying for Federal Tax Credits We also held a residual financial interest in an entity that owned a refined coal facility that qualified for federal tax credits under Section 45 of the Internal Revenue Code through 2019. The entity sold the majority of its assets in the first quarter of 2020, which resulted in a $7 million non-cash impairment of our investment at that time. We account for our investments in these entities using the equity method of accounting, recognizing our share of each entity’s results of operations and other reductions in the value of our investments in equity in net losses of unconsolidated entities, within our Condensed Consolidated Statements of Operations. During the three months ended March 31, 2021 and 2020, we recognized $9 million and $26 million (including the $7 million impairment of the refined coal facility noted above) of net losses, respectively. The related reduction in our income tax expense, which is primarily due to federal tax credits realized from the investments, was $16 million and $24 million for the three months ended March 31, 2021 and 2020, respectively. In addition, during the three months ended March 31, 2021 and 2020, we recognized interest expense of $2 million and $3 million, respectively, associated with our investments in low-income housing properties. See Note 13 for additional information related to these unconsolidated variable interest entities. Adjustments to Accruals and Related Deferred Taxes |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share | |
Earnings Per Share | 5. Earnings Per Share Basic and diluted earnings per share for the three months ended March 31 were computed using the following common share data (shares in millions): 2021 2020 Number of common shares outstanding at end of period 422.1 422.0 Effect of using weighted average common shares outstanding 0.8 2.2 Weighted average basic common shares outstanding 422.9 424.2 Dilutive effect of equity-based compensation awards and other contingently issuable shares 1.4 2.2 Weighted average diluted common shares outstanding 424.3 426.4 Potentially issuable shares 6.4 6.6 Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding 2.6 2.1 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 6. Commitments and Contingencies Financial Instruments — Management does not expect that any claims against or draws on these instruments would have a material adverse effect on our financial condition, results of operations or cash flows. We have not experienced any unmanageable difficulty in obtaining the required financial assurance instruments for our current operations. In an ongoing effort to mitigate risks of future cost increases and reductions in available capacity, we continue to evaluate various options to access cost-effective sources of financial assurance. Insurance — pollution legal liability, cyber incident liability and other coverages we believe are customary to the industry. Our exposure to loss for insurance claims is generally limited to the per incident deductible under the related insurance policy. Our exposure could increase if our insurers are unable to meet their commitments on a timely basis. We have retained a significant portion of the risks related to our health and welfare, general liability, automobile liability and workers’ compensation claims programs. “General liability” refers to the self-insured portion of specific third-party claims made against us that may be covered under our commercial General Liability Insurance Policy. For our self-insured portions, the exposure for unpaid claims and associated expenses, including incurred but not reported losses, is based on an actuarial valuation or internal estimates. The accruals for these liabilities could be revised if future occurrences or loss development significantly differ from such valuations and estimates. We use a wholly-owned insurance captive to insure the deductibles for our general liability, automobile liability and workers’ compensation claims programs. We do not expect the impact of any known casualty, property, environmental or other contingency to have a material impact on our financial condition, results of operations or cash flows. Guarantees — As of March 31, 2021, we have guaranteed the obligations and certain performance requirements of third parties in connection with both consolidated and unconsolidated entities, including guarantees to cover certain market value losses for certain properties adjacent to or near 18 of our landfills. We have also agreed to indemnify certain third-party purchasers against liabilities associated with divested operations prior to such sale. We do not believe that these contingent obligations will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. Environmental Matters — Estimating our degree of responsibility for remediation is inherently difficult. We recognize and accrue for an estimated remediation liability when we determine that such liability is both probable and reasonably estimable. Determining the method and ultimate cost of remediation requires that a number of assumptions be made. There can sometimes be a range of reasonable estimates of the costs associated with the likely site remediation alternatives identified in the environmental impact investigation. In these cases, we use the amount within the range that is our best estimate. If no amount within a range appears to be a better estimate than any other, we use the amount that is the low end of such range. If we used the high ends of such ranges, our aggregate potential liability would be approximately $135 million higher than the $218 million recorded in the Condensed Consolidated Balance Sheet as of March 31, 2021. Our ultimate responsibility may differ materially from current estimates. It is possible that technological, regulatory or enforcement developments, the results of environmental studies, the inability to identify other PRPs, the inability of other PRPs to contribute to the settlements of such liabilities, or other factors could require us to record additional liabilities. Our ongoing review of our remediation liabilities, in light of relevant internal and external facts and circumstances, could result in revisions to our accruals that could cause upward or downward adjustments to our balance sheet and income from operations. These adjustments could be material in any given period. As of March 31, 2021, we have been notified by the government that we are a PRP in connection with 73 locations listed on the Environmental Protection Agency’s (“EPA’s”) Superfund National Priorities List (“NPL”). Of the 73 sites at which claims have been made against us, 14 are sites we own. Each of the NPL sites we own was initially developed by others as a landfill disposal facility. At each of these facilities, we are working in conjunction with the government to evaluate or remediate identified site problems, and we have either agreed with other legally liable parties on an arrangement for sharing the costs of remediation or are working toward a cost-sharing agreement. We generally expect to receive any amounts due from other participating parties at or near the time that we make the remedial expenditures. The other 59 NPL sites, which we do not own, are at various procedural stages under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, known as CERCLA or Superfund. The majority of proceedings involving NPL sites that we do not own are based on allegations that certain of our subsidiaries (or their predecessors) transported hazardous substances to the sites, often prior to our acquisition of these subsidiaries. CERCLA generally provides for liability for those parties owning, operating, transporting to or disposing at the sites. Proceedings arising under Superfund typically involve numerous waste generators and other waste transportation and disposal companies and seek to allocate or recover costs associated with site investigation and remediation, which costs could be substantial and could have a material adverse effect on our consolidated financial statements. At some of the sites at which we have been identified as a PRP, our liability is well defined as a consequence of a governmental decision and an agreement among liable parties as to the share each will pay for implementing that remedy. At other sites, where no remedy has been selected or the liable parties have been unable to agree on an appropriate allocation, our future costs are uncertain. On October 11, 2017, the EPA issued its Record of Decision (“ROD”) with respect to the previously proposed remediation plan for the San Jacinto waste pits in Harris County, Texas. McGinnes Industrial Maintenance Corporation (“MIMC”), an indirect wholly-owned subsidiary of WM, operated some of the waste pits from 1965 to 1966 and has been named as a site PRP. In 1998, WM acquired the stock of the parent entity of MIMC. MIMC has been working with the EPA and other named PRPs as the process of addressing the site proceeds. On April 9, 2018, MIMC and International Paper Company entered into an Administrative Order on Consent agreement with the EPA to develop a remedial design for the EPA’s proposed remedy for the site. Allocation of responsibility among the PRPs for the proposed remedy has not been established. As of March 31, 2021 and December 31, 2020, the recorded liability for MIMC’s estimated potential share of the EPA’s proposed remedy and related costs was $54 million and $55 million, respectively. MIMC’s ultimate liability could be materially different from current estimates. Item 103 of the SEC’s Regulation S-K requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings, or such proceedings are known to be contemplated, unless we reasonably believe that the matter will result in no monetary sanctions, or in monetary sanctions, exclusive of interest and costs, below a stated threshold. In accordance with this SEC regulation, the Company uses a threshold of $1 million for purposes of determining whether disclosure of any such environmental proceedings is required. As of the date of this filing, we are not aware of any matters that are required to be disclosed pursuant to this standard. From time to time, we are also named as defendants in personal injury and property damage lawsuits, including purported class actions, on the basis of having owned, operated or transported waste to a disposal facility that is alleged to have contaminated the environment or, in certain cases, on the basis of having conducted environmental remediation activities at sites. Some of the lawsuits may seek to have us pay the costs of monitoring of allegedly affected sites and health care examinations of allegedly affected persons for a substantial period of time even where no actual damage is proven. While we believe we have meritorious defenses to these lawsuits, the ultimate resolution is often substantially uncertain due to the difficulty of determining the cause, extent and impact of alleged contamination (which may have occurred over a long period of time), the potential for successive groups of complainants to emerge, the diversity of the individual plaintiffs’ circumstances, and the potential contribution or indemnification obligations of co-defendants or other third parties, among other factors. Additionally, we often enter into agreements with landowners imposing obligations on us to meet certain regulatory or contractual conditions upon site closure or upon termination of the agreements. Compliance with these agreements inherently involves subjective determinations and may result in disputes, including litigation. Litigation — WM’s charter and bylaws provide that WM shall indemnify against all liabilities and expenses, and upon request shall advance expenses to any person, who is subject to a pending or threatened proceeding because such person is or was a director or officer of the Company. Such indemnification is required to the maximum extent permitted under Delaware law. Accordingly, the director or officer must execute an undertaking to reimburse the Company for any fees advanced if it is later determined that the director or officer was not permitted to have such fees advanced under Delaware law. Additionally, the Company has direct contractual obligations to provide indemnification to each of the members of WM’s Board of Directors and each of WM’s executive officers. The Company may incur substantial expenses in connection with the fulfillment of its advancement of costs and indemnification obligations in connection with actions or proceedings that may be brought against its former or current officers, directors and employees. Multiemployer Defined Benefit Pension Plans — We do not believe that any future liability relating to our past or current participation in, or withdrawals from, the Multiemployer Pension Plans to which we contribute will have a material adverse effect on our business, financial condition or liquidity. However, liability for future withdrawals could have a material adverse effect on our results of operations or cash flows for a particular reporting period, depending on the number of employees withdrawn and the financial condition of the Multiemployer Pension Plan(s) at the time of such withdrawal(s). Tax Matters — by taxing authorities are not currently expected to have a material adverse effect on our financial condition, results of operations or cash flows. |
Segment and Related Information
Segment and Related Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment and Related Information | |
Segment and Related Information | 7. Segment and Related Information We evaluate, oversee and manage the financial performance of our Solid Waste business subsidiaries through our 17 Areas. The 17 Areas constitute operating segments and we have evaluated the aggregation criteria and concluded that, based on the similarities between our Areas, including the fact that our Solid Waste business is homogenous across geographies with the same services offered across the Areas, aggregation of our Areas is appropriate for purposes of presenting our reportable segments. Accordingly, we have aggregated our 17 Areas into three tiers that we believe have similar economic characteristics and future prospects based in large part on a review of the Areas’ income from operations margins. The economic variations experienced by our Areas are attributable to a variety of factors, including regulatory environment of the Area; economic environment of the Area, including level of commercial and industrial activity; population density; service offering mix and disposal logistics, with no one factor being singularly determinative of an Area’s current or future economic performance. On an annual basis, we analyze the Areas’ income from operations margins for purposes of segment reporting and, if necessary, realign our Solid Waste tiers to reflect recent changes in their relative economic characteristics and prospects. These changes are the results of various factors including acquisitions, divestitures, business mix and the economic climate of various geographies. No realignment was necessary for the periods presented. Tier 1 is comprised of our operations across the Southern U.S., with the exception of the Southern California area and the Florida area, and also includes the New England area and the tri-state area that includes Michigan, Indiana and Ohio. Tier 2 includes California, Canada, and the Wisconsin and Minnesota area. Tier 3 encompasses all the remaining operations including the Pacific Northwest, the Mid-Atlantic region of the U.S., the Florida area, and Illinois and the Missouri Valley area. The operating segments not evaluated and overseen through the 17 Areas are presented herein as “Other” as these operating segments do not meet the criteria to be aggregated with other operating segments and do not meet the quantitative criteria to be separately reported. Summarized financial information concerning our reportable segments for the three months ended March 31 is shown in the following table (in millions): Gross Intercompany Net Income Operating Operating Operating from Revenues Revenues(c) Revenues Operations(d) 2021 Solid Waste: Tier 1 $ 1,639 $ (320) $ 1,319 $ 425 Tier 2 1,007 (216) 791 202 Tier 3 1,660 (300) 1,360 291 Solid Waste 4,306 (836) 3,470 918 Other (a) 665 (23) 642 18 4,971 (859) 4,112 936 Corporate and Other (b) — — — (286) Total $ 4,971 $ (859) $ 4,112 $ 650 2020 Solid Waste: Tier 1 $ 1,503 $ (280) $ 1,223 $ 393 Tier 2 932 (198) 734 188 Tier 3 1,541 (294) 1,247 264 Solid Waste 3,976 (772) 3,204 845 Other (a) 554 (29) 525 (25) 4,530 (801) 3,729 820 Corporate and Other (b) — — — (247) Total $ 4,530 $ (801) $ 3,729 $ 573 (a) “Other” includes (i) our Strategic Business Solutions (“WMSBS”) business; (ii) those elements of our landfill gas-to-energy operations and third-party subcontract and administration revenues managed by our Energy and Environmental Services (“EES”) and WM Renewable Energy businesses that are not included in the operations of our reportable segments; (iii) our recycling brokerage services and (iv) certain other expanded service offerings and solutions. In addition, our “Other” segment reflects the results of non-operating entities that provide financial assurance and self-insurance support for our Solid Waste business, net of intercompany activity. The increase in income from operations was primarily driven by (i) increased market values for renewable energy credits generated by our WM Renewable Energy business; (ii) a gain from the divestitures of certain ancillary operations and (iii) significantly higher commodity prices benefiting our recycling brokerage services. (b) Corporate operating results reflect certain costs incurred for various support services that are not allocated to our reportable segments. These support services include, among other things, treasury, legal, information technology, tax, insurance, centralized service center processes, other administrative functions and the maintenance of our closed landfills. Income from operations for “Corporate and Other” also includes costs associated with our long-term incentive program and any administrative expenses or revisions to our estimated obligations associated with divested operations. The decrease in income from operations was primarily driven by increased expenses as a result of (i) higher incentive compensation; (ii) a charge pertaining to reserves for certain loss contingencies and (iii) investments we are making in our digital platform. (c) Intercompany operating revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments. Transactions within and between segments are generally made on a basis intended to reflect the market value of the service. (d) Income from operations provided by our Solid Waste business is generally indicative of the margins provided by our collection, landfill, transfer and recycling lines of business. From time to time, the operating results of our reportable segments are significantly affected by certain transactions or events that management believes are not indicative or representative of our results. Income from operations in our Solid Waste business increased primarily due to (i) revenue growth from yield in our collection and disposal businesses; (ii) controlling our operating costs and margins with volume declines and (iii) higher recycling commodity prices. During the three months ended March 31, 2021, the contribution of Advanced Disposal to income from operations was offset by elevated depreciation and amortization of acquired assets. The mix of operating revenues from our major lines of business for the three months ended March 31 are as follows (in millions): 2021 2020 Commercial $ 1,131 $ 1,063 Residential 782 650 Industrial 743 693 Other collection 116 112 Total collection 2,772 2,518 Landfill 915 887 Transfer 465 441 Recycling 342 254 Other (a) 477 430 Intercompany (b) (859) (801) Total $ 4,112 $ 3,729 (a) The “Other” line of business includes (i) our WMSBS business; (ii) our landfill gas-to-energy operations; (iii) certain services within our EES business, including our construction and remediation services and our services associated with the disposal of fly ash and (iv) certain other expanded service offerings and solutions. In addition, our “Other” line of business reflects the results of non-operating entities that provide financial assurance and self-insurance support for our Solid Waste business, net of intercompany activity. Activity related to collection, landfill, transfer and recycling within “Other” has been reclassified to the appropriate line of business for purposes of the presentation in this table. (b) Intercompany revenues between lines of business are eliminated in the Condensed Consolidated Financial Statements included within this report. Fluctuations in our operating results may be caused by many factors, including period-to-period changes in the relative contribution of revenue by each line of business, changes in commodity prices and general economic conditions. Our revenues and income from operations typically reflect seasonal patterns. Our operating revenues tend to be somewhat higher in summer months, primarily due to the higher construction and demolition waste volumes. The volumes of industrial and residential waste in certain regions where we operate also tend to increase during the summer months. Our second and third quarter revenues and results of operations typically reflect these seasonal trends. Prior year period operating results were negatively impacted by COVID-19, as volumes declined beginning in March 2020 in our landfill, industrial and commercial collection businesses due to steps taken by national and local governments to slow the spread of the virus, including travel bans, prohibitions on group events and gatherings, shutdowns of certain businesses, curfews, shelter-in-place orders and recommendations to practice social distancing. Service disruptions caused by severe storms, extended periods of inclement weather or climate events can significantly affect the operating results of the Areas affected. On the other hand, certain destructive weather and climate conditions, such as wildfires in the Western U.S. and hurricanes that most often impact our operations in the Southern and Eastern U.S. during the second half of the year, can increase our revenues in the Areas affected as a result of the waste volumes generated by these events. While weather-related and other event driven special projects can boost revenues through additional work for a limited time, as a result of significant start-up costs and other factors, such revenue can generate earnings at comparatively lower margins. |
Acquisition of Advanced Disposa
Acquisition of Advanced Disposal | 3 Months Ended |
Mar. 31, 2021 | |
Acquisition of Advanced Disposal | |
Acquisition of Advanced Disposal | 8. Acquisition of Advanced Disposal On October 30, 2020, we completed the acquisition of all outstanding shares of Advanced Disposal for $30.30 per share in cash, pursuant to an Agreement and Plan of Merger dated April 14, 2019, as amended on June 24, 2020. Total enterprise value of the acquisition was $4.6 billion when including approximately $1.8 billion of Advanced Disposal’s net debt. This acquisition grows our footprint and allows us to provide differentiated, sustainable waste management and recycling services to approximately three million new commercial, industrial, and residential customers, primarily located in the Eastern half of the U.S. The acquisition was funded using a $3.0 billion, 364-day, U.S. revolving credit facility and our commercial paper program. In November 2020, we issued $2.5 billion of senior notes and used a portion of the proceeds to repay all outstanding borrowings under the $3.0 billion, 364-day, U.S. revolver and terminated the facility. Our consolidated financial statements have not been retroactively restated to include Advanced Disposal’s historical financial position or results of operations. The acquisition was accounted for as a business combination. In accordance with the purchase method of accounting, the purchase price paid has been allocated to the assets and liabilities acquired based upon their estimated fair values as of the acquisition date, with the excess of the purchase price over the net assets acquired recorded as goodwill. We are in the process of valuing all of the assets and liabilities acquired in the acquisition, and, until we have completed our valuation process, there may be adjustments to our estimates of fair value and resulting preliminary purchase price allocation, specifically those that require significant accounting estimates and assumptions, such as our landfills and intangibles. Goodwill of $2.5 billion was calculated as the excess of the consideration paid over the net assets recognized and represents the future economic benefits expected to arise from other assets acquired that could not be individually identified and separately recognized. Goodwill has been assigned to our Areas that have integrated these operations as they are benefiting from the synergies of the combination. Goodwill related to this acquisition is not deductible for income tax purposes. The following table shows the preliminary purchase price allocation as of the date acquired, and adjustments to March 31, 2021 (in millions): October 30, 2020 Adjustments March 31, 2021 Accounts and other receivables $ 159 $ — $ 159 Parts and supplies 8 — 8 Other current assets 17 — 17 Assets held for sale (a) 1,022 — 1,022 Property and equipment 1,278 17 1,295 Goodwill 2,470 — 2,470 Other intangible assets 604 (3) 601 Investments in unconsolidated entities 9 — 9 Other assets 27 (2) 25 Accounts payable (107) — (107) Accrued liabilities (155) — (155) Deferred revenues (19) — (19) Current portion of long-term debt (12) — (12) Liabilities held for sale (a) (234) — (234) Long-term debt, less current portion (b) (441) — (441) Landfill and environmental remediation liabilities (242) (1) (243) Deferred income taxes (223) (12) (235) Other liabilities (79) 1 (78) Total purchase price $ 4,082 $ — $ 4,082 (a) In connection with our acquisition of Advanced Disposal, we were required by the U.S. Department of Justice to divest assets, including a portion of the assets acquired from Advanced Disposal. Upon acquisition these assets met the criteria for reporting discontinued operations and were classified as held for sale and included within the “Assets held for sale” and “Liabilities held for sale” line items in the above preliminary allocation of purchase price. Immediately following the closing of our acquisition of Advanced Disposal, the transactions contemplated by the U.S. Department of Justice were consummated and we sold the net assets to GFL Environmental for total consideration of $856 million. (b) At the time of acquisition, Advanced Disposal had outstanding $425 million of 5.625% senior notes due November 2024, the fair value of which was $438 million. In November 2020, we redeemed the notes pursuant to an optional redemption feature. The preliminary allocation of $601 million as of March 31, 2021 for other intangibles includes $572 million for customer relationships with an amortization period of 15 years and $29 million of other intangibles with a weighted average amortization period of seven years. |
Divestitures, Asset Impairments
Divestitures, Asset Impairments and Unusual Items | 3 Months Ended |
Mar. 31, 2021 | |
Divestitures, Asset Impairments and Unusual Items | |
Divestitures, Asset Impairments and Unusual Items | 9. Divestitures, Asset Impairments and Unusual Items (Gain) Loss from Divestitures, Asset Impairments and Unusual Items, Net During the first quarter of 2021, we recognized net charges of $17 million consisting of charges for (i) a $19 million charge pertaining to reserves for loss contingencies in our Corporate and Other segment and (ii) $6 million of asset impairment charges primarily related to our WM Renewable Energy business within our Other Segment; which were partially offset by an $8 million gain from divestitures of certain ancillary operations in our Other segment. Equity in Net Losses of Unconsolidated Entities During the first quarter of 2020, we recorded a non-cash impairment charge of $7 million related to our investment in a refined coal facility which is discussed further in Note 4. The fair value of our investment was not readily determinable; thus, we determined the fair value using management assumptions pertaining to investment value (Level 3). |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) | |
Accumulated Other Comprehensive Income (Loss) | 10. Accumulated Other Comprehensive Income (Loss) The changes in the balances of each component of accumulated other comprehensive income (loss), net of tax, which is included as a component of Waste Management, Inc. stockholders’ equity, are as follows (in millions, with amounts in parentheses representing decreases to accumulated other comprehensive income): Foreign Post- Available- Currency Retirement Derivative for-Sale Translation Benefit Instruments Securities Adjustments Obligations Total Balance, December 31, 2020 $ (9) $ 49 $ (1) $ — $ 39 Other comprehensive income (loss) before reclassifications, net of tax expense (benefit) of $0, $(2), $0 and $0, respectively — (5) 13 — 8 Amounts reclassified from accumulated other comprehensive (income) loss, net of tax (expense) benefit of $0, $0, $0 and $0, respectively 1 — — — 1 Net current period other comprehensive income (loss) 1 (5) 13 — 9 Balance, March 31, 2021 $ (8) $ 44 $ 12 $ — $ 48 |
Common Stock Repurchase Program
Common Stock Repurchase Program | 3 Months Ended |
Mar. 31, 2021 | |
Common Stock Repurchase Program | |
Common Stock Repurchase Program | 11. Common Stock Repurchase Program The Company repurchases shares of its common stock as part of capital allocation programs authorized by our Board of Directors. In February 2021, we entered into an accelerated share repurchase (“ASR”) agreement to repurchase $250 million of our common stock. At the beginning of the repurchase period, we delivered $250 million cash and received 1.8 million shares based on a stock price of $110.56. The final number of shares to be repurchased and the final average price per share under the ASR agreement will depend on the volume-weighted average price of our stock, less a discount, during the term of the agreement. Purchases under the ASR agreement are expected to be completed in April 2021. As of March 31, 2021, the Company has authorization for $1.1 billion of future share repurchases. Any future share repurchases pursuant to this authorization of our Board of Directors will be made at the discretion of management and will depend on factors similar to those considered by the Board of Directors in making dividend declarations, including our net earnings, financial condition and cash required for future business plans, growth and acquisitions. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Measurements | |
Fair Value Measurements | 12. Fair Value Measurements Assets and Liabilities Accounted for at Fair Value Our assets and liabilities that are measured at fair value on a recurring basis include the following (in millions): March 31, December 31, 2021 2020 Fair Value Measurements Using: Quoted prices in active markets (Level 1): Cash equivalents and money market funds $ 419 $ 530 Significant other observable inputs (Level 2): Available-for-sale securities (a) 457 390 Significant unobservable inputs (Level 3): Redeemable preferred stock (b) 49 49 Total Assets $ 925 $ 969 (a) Our available-for-sale securities primarily relate to debt securities with maturities over the next nine years . (b) When available, Level 3 investments have been measured based on third-party investors’ recent or pending transactions in these securities, which are considered the best evidence of fair value. When this evidence is not available, we use other valuation techniques as appropriate and available. These valuation methodologies may include transactions in similar instruments, discounted cash flow techniques, third-party appraisals or industry multiples and public company comparable transactions . See Note 8 for information related to the nonrecurring fair value measurement of assets and liabilities acquired in connection with our acquisition of Advanced Disposal. Fair Value of Debt As of March 31, 2021 and December 31, 2020, the carrying value of our debt was $13.5 billion and $13.8 billion. The estimated fair value of our debt was approximately $14.1 billion and $15.2 billion as of March 31, 2021 and December 31, 2020, respectively. The decrease in the fair value of debt was primarily attributable to increases in current market rates for similar types of instruments. Although we have determined the estimated fair value amounts using available market information and commonly accepted valuation methodologies, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, our estimates are not necessarily indicative of the amounts that we, or holders of the instruments, could realize in a current market exchange. The use of different assumptions or estimation methodologies could have a material effect on the estimated fair values. The fair value estimates are based on Level 2 inputs of the fair value hierarchy available as of March 31, 2021 and December 31, 2020. These amounts have not been revalued since those dates, and current estimates of fair value could differ significantly from the amounts presented. |
Variable Interest Entities
Variable Interest Entities | 3 Months Ended |
Mar. 31, 2021 | |
Variable Interest Entities | |
Variable Interest Entities | 13. Variable Interest Entities Following is a description of our financial interests in unconsolidated and consolidated variable interest entities that we consider significant: Low-Income Housing Properties We do not consolidate our investments in entities established to manage low-income housing properties because we are not the primary beneficiary of these entities as we do not have the power to individually direct the activities of these entities. Accordingly, we account for these investments under the equity method of accounting. Our aggregate investment balance in these entities was $220 million and $228 million as of March 31, 2021 and December 31, 2020, respectively. The debt balance related to our investments in low-income housing properties was $196 million and $210 million as of March 31, 2021 and December 31, 2020, respectively. During the first quarter of 2020, the entity that owned the investment in the refined coal facility sold the majority of its assets, which resulted in a $7 million non-cash impairment of our investment. Additional information related to these investments is discussed in Note 4. Trust Funds for Final Capping, Closure, Post-Closure or Environmental Remediation Obligations Unconsolidated Variable Interest Entities — Consolidated Variable Interest Entities — |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Basis of Presentation | |
Basis of Presentation | The financial statements presented in this report represent the consolidation of Waste Management, Inc., a Delaware corporation; its wholly-owned and majority-owned subsidiaries; and certain variable interest entities for which Waste Management, Inc. or its subsidiaries are the primary beneficiaries as described in Note 13. Waste Management, Inc. is a holding company and all operations are conducted by its subsidiaries. When the terms “the Company,” “we,” “us” or “our” are used in this document, those terms refer to Waste Management, Inc., its consolidated subsidiaries and consolidated variable interest entities. When we use the term “WM,” we are referring only to Waste Management, Inc., the parent holding company. We are North America’s leading provider of comprehensive waste management environmental services, providing services throughout the United States (“U.S.”) and Canada. We partner with our residential, commercial, industrial and municipal customers and the communities we serve to manage and reduce waste at each stage from collection to disposal, while recovering valuable resources and creating clean, renewable energy. Our “Solid Waste” business is operated and managed locally by our subsidiaries that focus on distinct geographic areas and provide collection, transfer, disposal, and recycling and resource recovery services. Through our subsidiaries, we are also a leading developer, operator and owner of landfill gas-to-energy facilities in the U.S. We evaluate, oversee and manage the financial performance of our Solid Waste business subsidiaries through our 17 Areas. On October 30, 2020, we acquired Advanced Disposal Services, Inc. (“Advanced Disposal”), the operations of which are presented in this report within our existing Solid Waste tiers. We also provide additional services that are not managed through our Solid Waste business, which are presented in this report as “Other.” Additional information related to our segments and our acquisition of Advanced Disposal are included in Notes 7 and 8, respectively. The Condensed Consolidated Financial Statements as of March 31, 2021 and for the three months ended March 31, 2021 and 2020 are unaudited. In the opinion of management, these financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, comprehensive income, cash flows, and changes in equity for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The financial statements presented herein should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. In preparing our financial statements, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with precision from available data or simply cannot be calculated. In some cases, these estimates are difficult to determine, and we must exercise significant judgment. In preparing our financial statements, the most difficult, subjective and complex estimates and the assumptions that present the greatest amount of uncertainty relate to our accounting for landfills, environmental remediation liabilities, long-lived asset impairments, the fair value of assets and liabilities acquired in business combinations or asset acquisitions and reserves associated with our insured and self-insured claims. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements. |
Revenue Recognition | Revenue Recognition We generally recognize revenue as services are performed or products are delivered. For example, revenue typically is recognized as waste is collected, tons are received at our landfills or transfer stations, or recycling commodities are collected or delivered as product. We bill for certain services prior to performance. Such services include, among others, certain commercial and residential contracts, and equipment rentals. These advance billings are included in deferred revenues and recognized as revenue in the period service is provided. Substantially all our deferred revenues during the reported periods are realized as revenues within one Contract Acquisition Costs Our incremental direct costs of obtaining a contract, which consist primarily of sales incentives, are generally deferred and amortized to selling, general and administrative expense over the estimated life of the relevant customer relationship, ranging from five As of March 31, 2021 and December 31, 2020, we had $165 million and $159 million, respectively, of deferred contract costs, of which $119 million and $118 million, respectively, was related to deferred sales incentives. For the three months ended March 31, 2021 and 2020, amortization of our sales incentives was not material to our results of operations. |
Leases | Leases Amounts for our operating lease right-of-use assets are recorded in long-term other assets in our Condensed Consolidated Balance Sheets. The current and long-term portion of our operating lease liabilities are reflected in accrued liabilities and other long-term liabilities, respectively, in our Condensed Consolidated Balance Sheets. Amounts for our financing leases are recorded in property and equipment, net of accumulated depreciation, and current or long-term debt in our Condensed Consolidated Balance Sheets, as appropriate. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments held within our restricted trust and escrow accounts, and accounts receivable. We make efforts to control our exposure to credit risk associated with these instruments by (i) placing our assets and other financial interests with a diverse group of credit-worthy financial institutions; (ii) holding high-quality financial instruments while limiting investments in any one instrument and (iii) maintaining strict policies over credit extension that include credit evaluations, credit limits and monitoring procedures, although generally we do not have collateral requirements for credit extensions. We also control our exposure associated with trade receivables by discontinuing service, to the extent allowable, to non-paying customers. However, our overall credit risk associated with trade receivables is limited due to the large number and diversity of customers we serve. |
Reclassifications | Reclassifications When necessary, reclassifications have been made to our prior period financial information to conform to the current year presentation and are not material to our consolidated financial statements. Our prior year accumulated depreciation and gross property and equipment as of December 31, 2020 were overstated and have been corrected in our current year presentation. |
Landfill and Environmental Re_2
Landfill and Environmental Remediation Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Landfill and Environmental Remediation Liabilities | |
Liabilities for Landfill and Environmental Remediation Costs | Liabilities for landfill and environmental remediation costs are presented in the table below (in millions): March 31, 2021 December 31, 2020 Environmental Environmental Landfill Remediation Total Landfill Remediation Total Current (in accrued liabilities) $ 130 $ 25 $ 155 $ 138 $ 26 $ 164 Long-term 2,069 193 2,262 2,018 204 2,222 $ 2,199 $ 218 $ 2,417 $ 2,156 $ 230 $ 2,386 |
Changes to Landfill and Environmental Remediation Liabilities | The changes to landfill and environmental remediation liabilities for the three months ended March 31, 2021 are reflected in the table below (in millions): Environmental Landfill Remediation December 31, 2020 $ 2,156 $ 230 Obligations incurred and capitalized 26 — Obligations settled (16) (5) Interest accretion 26 — Revisions in estimates and interest rate assumptions 7 (7) Acquisitions, divestitures and other adjustments — — March 31, 2021 $ 2,199 $ 218 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt | |
Components of Debt | The following table summarizes the major components of debt as of each balance sheet date (in millions) and provides the maturities and interest rate ranges of each major category as of March 31, 2021: March 31, December 31, 2021 2020 Commercial paper program (weighted average interest rate of 0.4% as of March 31, 2021 and December 31, 2020) $ 1,534 $ 1,814 Senior notes, maturing through 2050, interest rates ranging from 0.75% to 7.75% (weighted average interest rate of 3.3% as of March 31, 2021 and December 31, 2020) 8,465 8,465 Canadian senior notes, C$500 million maturing September 2026, interest rate of 2.6% 398 393 Tax-exempt bonds, maturing through 2048, fixed and variable interest rates ranging from 0.1% to 4.3% (weighted average interest rate of 1.7% as of March 31, 2021 and December 31, 2020) 2,547 2,571 Financing leases and other, maturing through 2085, weighted average interest rate of 4.6% (a) 627 652 Debt issuance costs, discounts and other (83) (85) 13,488 13,810 Current portion of long-term debt 244 551 $ 13,244 $ 13,259 (a) Excluding our landfill financing leases, the maturities of our financing leases and other debt obligations extend through 2059. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share | |
Common Share Data Used for Computing Basic and Diluted Earnings Per Share | Basic and diluted earnings per share for the three months ended March 31 were computed using the following common share data (shares in millions): 2021 2020 Number of common shares outstanding at end of period 422.1 422.0 Effect of using weighted average common shares outstanding 0.8 2.2 Weighted average basic common shares outstanding 422.9 424.2 Dilutive effect of equity-based compensation awards and other contingently issuable shares 1.4 2.2 Weighted average diluted common shares outstanding 424.3 426.4 Potentially issuable shares 6.4 6.6 Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding 2.6 2.1 |
Segment and Related Informati_2
Segment and Related Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment and Related Information | |
Reportable Segments | Summarized financial information concerning our reportable segments for the three months ended March 31 is shown in the following table (in millions): Gross Intercompany Net Income Operating Operating Operating from Revenues Revenues(c) Revenues Operations(d) 2021 Solid Waste: Tier 1 $ 1,639 $ (320) $ 1,319 $ 425 Tier 2 1,007 (216) 791 202 Tier 3 1,660 (300) 1,360 291 Solid Waste 4,306 (836) 3,470 918 Other (a) 665 (23) 642 18 4,971 (859) 4,112 936 Corporate and Other (b) — — — (286) Total $ 4,971 $ (859) $ 4,112 $ 650 2020 Solid Waste: Tier 1 $ 1,503 $ (280) $ 1,223 $ 393 Tier 2 932 (198) 734 188 Tier 3 1,541 (294) 1,247 264 Solid Waste 3,976 (772) 3,204 845 Other (a) 554 (29) 525 (25) 4,530 (801) 3,729 820 Corporate and Other (b) — — — (247) Total $ 4,530 $ (801) $ 3,729 $ 573 (a) “Other” includes (i) our Strategic Business Solutions (“WMSBS”) business; (ii) those elements of our landfill gas-to-energy operations and third-party subcontract and administration revenues managed by our Energy and Environmental Services (“EES”) and WM Renewable Energy businesses that are not included in the operations of our reportable segments; (iii) our recycling brokerage services and (iv) certain other expanded service offerings and solutions. In addition, our “Other” segment reflects the results of non-operating entities that provide financial assurance and self-insurance support for our Solid Waste business, net of intercompany activity. The increase in income from operations was primarily driven by (i) increased market values for renewable energy credits generated by our WM Renewable Energy business; (ii) a gain from the divestitures of certain ancillary operations and (iii) significantly higher commodity prices benefiting our recycling brokerage services. (b) Corporate operating results reflect certain costs incurred for various support services that are not allocated to our reportable segments. These support services include, among other things, treasury, legal, information technology, tax, insurance, centralized service center processes, other administrative functions and the maintenance of our closed landfills. Income from operations for “Corporate and Other” also includes costs associated with our long-term incentive program and any administrative expenses or revisions to our estimated obligations associated with divested operations. The decrease in income from operations was primarily driven by increased expenses as a result of (i) higher incentive compensation; (ii) a charge pertaining to reserves for certain loss contingencies and (iii) investments we are making in our digital platform. (c) Intercompany operating revenues reflect each segment’s total intercompany sales, including intercompany sales within a segment and between segments. Transactions within and between segments are generally made on a basis intended to reflect the market value of the service. (d) Income from operations provided by our Solid Waste business is generally indicative of the margins provided by our collection, landfill, transfer and recycling lines of business. From time to time, the operating results of our reportable segments are significantly affected by certain transactions or events that management believes are not indicative or representative of our results. Income from operations in our Solid Waste business increased primarily due to (i) revenue growth from yield in our collection and disposal businesses; (ii) controlling our operating costs and margins with volume declines and (iii) higher recycling commodity prices. During the three months ended March 31, 2021, the contribution of Advanced Disposal to income from operations was offset by elevated depreciation and amortization of acquired assets. |
Summary of operating revenues mix | The mix of operating revenues from our major lines of business for the three months ended March 31 are as follows (in millions): 2021 2020 Commercial $ 1,131 $ 1,063 Residential 782 650 Industrial 743 693 Other collection 116 112 Total collection 2,772 2,518 Landfill 915 887 Transfer 465 441 Recycling 342 254 Other (a) 477 430 Intercompany (b) (859) (801) Total $ 4,112 $ 3,729 (a) The “Other” line of business includes (i) our WMSBS business; (ii) our landfill gas-to-energy operations; (iii) certain services within our EES business, including our construction and remediation services and our services associated with the disposal of fly ash and (iv) certain other expanded service offerings and solutions. In addition, our “Other” line of business reflects the results of non-operating entities that provide financial assurance and self-insurance support for our Solid Waste business, net of intercompany activity. Activity related to collection, landfill, transfer and recycling within “Other” has been reclassified to the appropriate line of business for purposes of the presentation in this table. (b) Intercompany revenues between lines of business are eliminated in the Condensed Consolidated Financial Statements included within this report. |
Acquisition of Advanced Dispo_2
Acquisition of Advanced Disposal (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Acquisition of Advanced Disposal | |
Summary of purchase price allocation | The following table shows the preliminary purchase price allocation as of the date acquired, and adjustments to March 31, 2021 (in millions): October 30, 2020 Adjustments March 31, 2021 Accounts and other receivables $ 159 $ — $ 159 Parts and supplies 8 — 8 Other current assets 17 — 17 Assets held for sale (a) 1,022 — 1,022 Property and equipment 1,278 17 1,295 Goodwill 2,470 — 2,470 Other intangible assets 604 (3) 601 Investments in unconsolidated entities 9 — 9 Other assets 27 (2) 25 Accounts payable (107) — (107) Accrued liabilities (155) — (155) Deferred revenues (19) — (19) Current portion of long-term debt (12) — (12) Liabilities held for sale (a) (234) — (234) Long-term debt, less current portion (b) (441) — (441) Landfill and environmental remediation liabilities (242) (1) (243) Deferred income taxes (223) (12) (235) Other liabilities (79) 1 (78) Total purchase price $ 4,082 $ — $ 4,082 (a) In connection with our acquisition of Advanced Disposal, we were required by the U.S. Department of Justice to divest assets, including a portion of the assets acquired from Advanced Disposal. Upon acquisition these assets met the criteria for reporting discontinued operations and were classified as held for sale and included within the “Assets held for sale” and “Liabilities held for sale” line items in the above preliminary allocation of purchase price. Immediately following the closing of our acquisition of Advanced Disposal, the transactions contemplated by the U.S. Department of Justice were consummated and we sold the net assets to GFL Environmental for total consideration of $856 million. (b) At the time of acquisition, Advanced Disposal had outstanding $425 million of 5.625% senior notes due November 2024, the fair value of which was $438 million. In November 2020, we redeemed the notes pursuant to an optional redemption feature. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) | |
Components of Accumulated Other Comprehensive Income (Loss), net of tax | The changes in the balances of each component of accumulated other comprehensive income (loss), net of tax, which is included as a component of Waste Management, Inc. stockholders’ equity, are as follows (in millions, with amounts in parentheses representing decreases to accumulated other comprehensive income): Foreign Post- Available- Currency Retirement Derivative for-Sale Translation Benefit Instruments Securities Adjustments Obligations Total Balance, December 31, 2020 $ (9) $ 49 $ (1) $ — $ 39 Other comprehensive income (loss) before reclassifications, net of tax expense (benefit) of $0, $(2), $0 and $0, respectively — (5) 13 — 8 Amounts reclassified from accumulated other comprehensive (income) loss, net of tax (expense) benefit of $0, $0, $0 and $0, respectively 1 — — — 1 Net current period other comprehensive income (loss) 1 (5) 13 — 9 Balance, March 31, 2021 $ (8) $ 44 $ 12 $ — $ 48 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Measurements | |
Fair Value of Assets and Liabilities Measured on Recurring Basis | March 31, December 31, 2021 2020 Fair Value Measurements Using: Quoted prices in active markets (Level 1): Cash equivalents and money market funds $ 419 $ 530 Significant other observable inputs (Level 2): Available-for-sale securities (a) 457 390 Significant unobservable inputs (Level 3): Redeemable preferred stock (b) 49 49 Total Assets $ 925 $ 969 (a) Our available-for-sale securities primarily relate to debt securities with maturities over the next nine years . (b) When available, Level 3 investments have been measured based on third-party investors’ recent or pending transactions in these securities, which are considered the best evidence of fair value. When this evidence is not available, we use other valuation techniques as appropriate and available. These valuation methodologies may include transactions in similar instruments, discounted cash flow techniques, third-party appraisals or industry multiples and public company comparable transactions . |
Basis of Presentation (Detail)
Basis of Presentation (Detail) | 3 Months Ended |
Mar. 31, 2021area | |
Solid Waste [Member] | |
Segment Reporting Information [Line Items] | |
Number of areas | 17 |
Basis of Presentation - Revenue
Basis of Presentation - Revenue Recognition (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Contract Acquisition Costs | ||
Deferred contract costs | $ 165 | $ 159 |
Minimum [Member] | ||
Contract Acquisition Costs | ||
Deferred revenue recognition period | 1 month | |
Contract amortization period | 5 years | |
Maximum [Member] | ||
Contract Acquisition Costs | ||
Deferred revenue recognition period | 3 months | |
Contract amortization period | 13 years | |
Deferred Sales Incentives [Member] | ||
Contract Acquisition Costs | ||
Deferred contract costs | $ 119 | $ 118 |
Landfill and Environmental Re_3
Landfill and Environmental Remediation Liabilities - Summary (Detail) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Landfill and environmental remediation liabilities | ||
Total, Environmental Remediation | $ 218 | |
Current (in accrued liabilities) | 155 | $ 164 |
Long-term | 2,262 | 2,222 |
Total | 2,417 | 2,386 |
Landfill [Member] | ||
Landfill and environmental remediation liabilities | ||
Current (in accrued liabilities), Landfill | 130 | 138 |
Long-term, Landfill | 2,069 | 2,018 |
Total, Landfill | 2,199 | 2,156 |
Environmental Remediation Liabilities [Member] | ||
Landfill and environmental remediation liabilities | ||
Current (in accrued liabilities), Environmental Remediation | 25 | 26 |
Long-term, Environmental Remediation | 193 | 204 |
Total, Environmental Remediation | $ 218 | $ 230 |
Landfill and Environmental Re_4
Landfill and Environmental Remediation Liabilities - Changes (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Landfill and environmental remediation liabilities | ||
Interest accretion | $ 26 | $ 24 |
Ending balance, environmental remediation | 218 | |
Landfill [Member] | ||
Landfill and environmental remediation liabilities | ||
Beginning balance, landfill | 2,156 | |
Obligations incurred and capitalized | 26 | |
Obligations settled | (16) | |
Interest accretion | 26 | |
Revisions in estimates and interest rate assumptions | 7 | |
Ending balance, landfill | 2,199 | |
Environmental Remediation Liabilities [Member] | ||
Landfill and environmental remediation liabilities | ||
Beginning balance, environmental remediation | 230 | |
Obligations settled | (5) | |
Revisions in estimates and interest rate assumptions | (7) | |
Ending balance, environmental remediation | $ 218 |
Debt - Components (Detail)
Debt - Components (Detail) $ in Millions, $ in Millions | Mar. 31, 2021USD ($) | Mar. 31, 2021CAD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020CAD ($) |
Debt | ||||
Debt | $ 13,488 | $ 13,810 | ||
Debt issuance costs, discounts and other | (83) | (85) | ||
Current portion of long-term debt | 244 | 551 | ||
Long-term debt, less current portion | 13,244 | 13,259 | ||
Commercial Paper Program [Member] | ||||
Debt | ||||
Debt | 1,534 | $ 1,814 | ||
Current portion of long-term debt | $ 1,500 | |||
Weighted average interest rate | 0.40% | 0.40% | 0.40% | 0.40% |
Senior Notes, Aggregate [Member] | ||||
Debt | ||||
Debt | $ 8,465 | $ 8,465 | ||
Weighted average interest rate | 3.30% | 3.30% | 3.30% | 3.30% |
Canadian Senior Notes [Member] | ||||
Debt | ||||
Debt | $ 398 | $ 500 | $ 393 | $ 500 |
Interest rate (as a percent) | 2.60% | 2.60% | 2.60% | 2.60% |
Tax Exempt Bonds [Member] | ||||
Debt | ||||
Debt | $ 2,547 | $ 2,571 | ||
Current portion of long-term debt | $ 103 | |||
Weighted average interest rate | 1.70% | 1.70% | 1.70% | 1.70% |
Financing leases and other [Member] | ||||
Debt | ||||
Debt | $ 627 | $ 652 | ||
Current portion of long-term debt | $ 213 | |||
Weighted average interest rate | 4.60% | 4.60% | 4.60% | 4.60% |
Minimum [Member] | Senior Notes, Aggregate [Member] | ||||
Debt | ||||
Interest rate (as a percent) | 0.75% | 0.75% | 0.75% | 0.75% |
Minimum [Member] | Tax Exempt Bonds [Member] | ||||
Debt | ||||
Interest rate (as a percent) | 0.10% | 0.10% | 0.10% | 0.10% |
Maximum [Member] | Senior Notes, Aggregate [Member] | ||||
Debt | ||||
Interest rate (as a percent) | 7.75% | 7.75% | 7.75% | 7.75% |
Maximum [Member] | Tax Exempt Bonds [Member] | ||||
Debt | ||||
Interest rate (as a percent) | 4.30% | 4.30% | 4.30% | 4.30% |
Debt - Classification and Utili
Debt - Classification and Utilization (Detail) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Oct. 30, 2020 | |
Debt | ||||
Debt maturing or subject to remarketing within twelve months | $ 3,000 | |||
Current portion of long-term debt | 244 | $ 551 | ||
Commercial paper borrowings (repayments) | (280) | |||
Debt repayments | 49 | $ 25 | ||
Tax Exempt Bonds [Member] | ||||
Debt | ||||
Current portion of long-term debt | 103 | |||
Debt with interest rate periods that expire in the next 12 months | 1,200 | |||
Debt maturing or subject to remarketing within twelve months classified as long-term | 2,700 | |||
Variable-rate tax-exempt bonds | 54 | |||
Variable-rate tax-exempt bonds, non-current | 54 | |||
Debt repayments | $ 24 | |||
Tax Exempt Bonds [Member] | Minimum [Member] | ||||
Debt | ||||
Interest rate (as a percent) | 0.10% | 0.10% | ||
Tax Exempt Bonds [Member] | Maximum [Member] | ||||
Debt | ||||
Interest rate (as a percent) | 4.30% | 4.30% | ||
Financing leases and other [Member] | ||||
Debt | ||||
Current portion of long-term debt | $ 213 | |||
Debt repayments | 25 | |||
364-day revolving credit facility [Member] | ||||
Debt | ||||
Maximum capacity | $ 3,000 | |||
$3.5 billion revolving credit facility [Member] | ||||
Debt | ||||
Maximum capacity | 3,500 | |||
Outstanding borrowings under credit facility | 0 | |||
Letters of credit outstanding | 269 | |||
Unused and available credit capacity | 1,700 | |||
Commercial Paper Program [Member] | ||||
Debt | ||||
Current portion of long-term debt | $ 1,500 | |||
Debt term | 397 days | |||
Commercial paper borrowings | $ 1,500 | |||
Commercial paper borrowings (repayments) | (280) | |||
Other Letter Of Credit Lines [Member] | ||||
Debt | ||||
Letters of credit outstanding | $ 609 |
Income Taxes - Quarter informat
Income Taxes - Quarter information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Taxes | ||
Effective tax rate of income (loss) before income taxes | 22.70% | 17.00% |
Equity in net losses of unconsolidated entities | $ 9 | $ 26 |
Excess tax benefits associated with equity-based compensation | 9 | 21 |
Increase (decrease) to accruals and related deferred taxes | (6) | |
Asset impairments | 6 | |
Investments Qualifying for Federal Tax Credits [Member] | ||
Income Taxes | ||
Equity in net losses of unconsolidated entities | 9 | 26 |
Income tax (expense) benefit, including tax credits, from equity method investment | 16 | 24 |
Refined Coal Facility [Member] | ||
Income Taxes | ||
Equity method investments impairment charges | 7 | |
Investment In Low Income Housing Properties [Member] | ||
Income Taxes | ||
Interest expense | $ 2 | $ 3 |
Earnings Per Share (Detail)
Earnings Per Share (Detail) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Earnings Per Share | ||
Number of common shares outstanding at end of period | 422.1 | 422 |
Effect of using weighted average common shares outstanding | 0.8 | 2.2 |
Weighted average basic common shares outstanding | 422.9 | 424.2 |
Dilutive effect of equity-based compensation awards and other contingently issuable shares | 1.4 | 2.2 |
Weighted average diluted common shares outstanding | 424.3 | 426.4 |
Potentially issuable shares | 6.4 | 6.6 |
Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding | 2.6 | 2.1 |
Commitments and Contingencies -
Commitments and Contingencies - Quarter (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021USD ($)siteitem | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Commitments And Contingencies [Line Items] | |||
Number of landfills adjacent to or near homeowners' properties with agreements guaranteeing market value | item | 18 | ||
Environmental remediation reasonably possible additional losses high estimate | $ 135 | ||
Environmental remediation liabilities | $ 218 | ||
Number of sites listed on the EPA's NPL for which we have been notified we are a PRP | site | 73 | ||
Number of owned sites listed on the EPA's NPL for which we have been notified we are a PRP | site | 14 | ||
Number of non-owned sites listed on the EPA's NPL for which we have been notified we are a PRP | site | 59 | ||
Dollar threshold for environmental matters requiring disclosure under item 103 of the SEC's Regulation S-K | $ 1 | ||
Workforce covered by collective bargaining (as a percent) | 20.00% | ||
Expected time of completion of IRS audits | 24 months | ||
San Jacinto Waste Pits [Member] | |||
Commitments And Contingencies [Line Items] | |||
Environmental remediation liabilities | $ 54 | $ 55 | |
Withdrawal from Multiemployer Pension Plans [Member] | |||
Commitments And Contingencies [Line Items] | |||
Charge to "Operating" expenses | $ 3 | ||
$3.5 billion revolving credit facility [Member] | |||
Commitments And Contingencies [Line Items] | |||
Credit Facility, aggregate capacity | $ 3,500 |
Segment and Related Informati_3
Segment and Related Information - Information (Detail) - Solid Waste [Member] | 3 Months Ended |
Mar. 31, 2021areasegment | |
Segment Reporting Information [Line Items] | |
Number of areas | area | 17 |
Number of reportable segments | segment | 3 |
Segment and Related Informati_4
Segment and Related Information - Summary (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
Operating revenues | $ 4,112 | $ 3,729 |
Income from operations | 650 | 573 |
Asset impairments | 6 | |
Operating Group Total [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 4,112 | 3,729 |
Income from operations | 936 | 820 |
Solid Waste [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 3,470 | 3,204 |
Income from operations | 918 | 845 |
Tier 1 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 1,319 | 1,223 |
Income from operations | 425 | 393 |
Tier 2 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 791 | 734 |
Income from operations | 202 | 188 |
Tier 3 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 1,360 | 1,247 |
Income from operations | 291 | 264 |
Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 642 | 525 |
Income from operations | 18 | (25) |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 4,971 | 4,530 |
Operating Segments [Member] | Operating Group Total [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 4,971 | 4,530 |
Operating Segments [Member] | Solid Waste [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 4,306 | 3,976 |
Operating Segments [Member] | Tier 1 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 1,639 | 1,503 |
Operating Segments [Member] | Tier 2 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 1,007 | 932 |
Operating Segments [Member] | Tier 3 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 1,660 | 1,541 |
Operating Segments [Member] | Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | 665 | 554 |
Intercompany Operating Revenues [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | (859) | (801) |
Intercompany Operating Revenues [Member] | Operating Group Total [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | (859) | (801) |
Intercompany Operating Revenues [Member] | Solid Waste [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | (836) | (772) |
Intercompany Operating Revenues [Member] | Tier 1 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | (320) | (280) |
Intercompany Operating Revenues [Member] | Tier 2 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | (216) | (198) |
Intercompany Operating Revenues [Member] | Tier 3 [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | (300) | (294) |
Intercompany Operating Revenues [Member] | Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating revenues | (23) | (29) |
Corporate and Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Income from operations | $ (286) | $ (247) |
Segment and Related Informati_5
Segment and Related Information - Revenues mix (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue from External Customer [Line Items] | ||
Operating revenues | $ 4,112 | $ 3,729 |
Operating Segments [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 4,971 | 4,530 |
Operating Segments [Member] | Collection [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 2,772 | 2,518 |
Operating Segments [Member] | Commercial [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 1,131 | 1,063 |
Operating Segments [Member] | Residential [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 782 | 650 |
Operating Segments [Member] | Industrial [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 743 | 693 |
Operating Segments [Member] | Other collection [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 116 | 112 |
Operating Segments [Member] | Landfill [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 915 | 887 |
Operating Segments [Member] | Transfer [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 465 | 441 |
Operating Segments [Member] | Recycling [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 342 | 254 |
Operating Segments [Member] | Other Revenue [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | 477 | 430 |
Intercompany Operating Revenues [Member] | ||
Revenue from External Customer [Line Items] | ||
Operating revenues | $ (859) | $ (801) |
Acquisition of Advanced Dispo_3
Acquisition of Advanced Disposal (Detail) $ / shares in Units, customer in Millions, $ in Billions | Oct. 30, 2020USD ($)customer$ / shares | Nov. 30, 2020USD ($) |
364-day revolving credit facility [Member] | ||
Business Acquisition [Line Items] | ||
Maximum capacity | $ 3 | |
Senior Notes, Aggregate [Member] | ||
Business Acquisition [Line Items] | ||
Debt instrument face amount | $ 2.5 | |
Advanced Disposal [Member] | ||
Business Acquisition [Line Items] | ||
Price per share | $ / shares | $ 30.30 | |
Total consideration | $ 4.6 | |
Debt incurred for acquisition | $ 1.8 | |
Number of customers | customer | 3 |
Acquisition of Advanced Dispo_4
Acquisition of Advanced Disposal - Purchase Allocation (Detail) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Oct. 30, 2020 |
Purchase price allocation | |||
Goodwill | $ 8,980 | $ 8,994 | |
Carrying value of debt | 13,488 | $ 13,810 | |
Advanced Disposal [Member] | |||
Purchase price allocation | |||
Accounts and other receivables | 159 | ||
Parts and supplies | 8 | ||
Other current assets | 17 | ||
Assets held for sale | 1,022 | ||
Property and equipment | 1,295 | ||
Goodwill | 2,470 | ||
Other intangible assets | 601 | ||
Investments in unconsolidated entities | 9 | ||
Other assets | 25 | ||
Accounts payable | (107) | ||
Accrued liabilities | (155) | ||
Deferred revenues | (19) | ||
Current portion of long-term debt | (12) | ||
Liabilities held for sale | (234) | ||
Long-term debt, less current portion | (441) | ||
Landfill and environmental remediation liabilities | (243) | ||
Deferred income taxes | (235) | ||
Other liabilities | (78) | ||
Total purchase price | $ 4,082 | ||
Advanced Disposal [Member] | Advanced Disposal 5.625% senior notes due 2024 [Member] | |||
Purchase price allocation | |||
Carrying value of debt | $ 425 | ||
Interest rate (as a percent) | 5.625% | ||
Fair value of debt | $ 438 | ||
Advanced Disposal [Member] | Previously Reported [Member] | |||
Purchase price allocation | |||
Accounts and other receivables | 159 | ||
Parts and supplies | 8 | ||
Other current assets | 17 | ||
Assets held for sale | 1,022 | ||
Property and equipment | 1,278 | ||
Goodwill | 2,470 | ||
Other intangible assets | 604 | ||
Investments in unconsolidated entities | 9 | ||
Other assets | 27 | ||
Accounts payable | (107) | ||
Accrued liabilities | (155) | ||
Deferred revenues | (19) | ||
Current portion of long-term debt | (12) | ||
Liabilities held for sale | (234) | ||
Long-term debt, less current portion | (441) | ||
Landfill and environmental remediation liabilities | (242) | ||
Deferred income taxes | (223) | ||
Other liabilities | (79) | ||
Total purchase price | 4,082 | ||
Advanced Disposal [Member] | Adjustment [Member] | |||
Purchase price allocation | |||
Property and equipment | 17 | ||
Other intangible assets | (3) | ||
Other assets | (2) | ||
Landfill and environmental remediation liabilities | (1) | ||
Deferred income taxes | (12) | ||
Other liabilities | $ 1 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Divestitures (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Oct. 30, 2020 | |
Divestitures | ||
Gain (Loss) on Disposition of Assets | $ 8 | |
Advanced Disposal [Member] | Disposed of by Sale, Not Discontinued Operations [Member] | ||
Divestitures | ||
Divestiture consideration | $ 856 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures - Intangible Allocation (Detail) - Advanced Disposal [Member] - USD ($) $ in Millions | Oct. 30, 2020 | Mar. 31, 2021 |
Intangible assets | ||
Other intangible assets | $ 601 | |
Other Intangible Assets [Member] | ||
Intangible assets | ||
Other intangible assets | 29 | |
Weighted average amortization periods | 7 years | |
Customer Relationships [Member] | ||
Intangible assets | ||
Other intangible assets | $ 572 | |
Weighted average amortization periods | 15 years |
Divestitures, Asset Impairmen_2
Divestitures, Asset Impairments and Unusual Items (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Asset Impairments and Unusual Items | ||
(Gain) loss from divestitures, asset impairments and unusual items, net | $ 17 | |
Increase in legal accruals | 19 | |
Asset impairments | 6 | |
Gain (loss) on sale of assets | $ 8 | |
Refined Coal Facility [Member] | ||
Asset Impairments and Unusual Items | ||
Equity method investments impairment charges | $ 7 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Changes (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
AOCI roll forward | ||
Beginning balance | $ 7,454 | $ 7,070 |
Other comprehensive income (loss), net of tax | 9 | (83) |
Ending balance | 7,429 | 6,745 |
Accumulated Other Comprehensive Income (Loss) [Member] | ||
AOCI roll forward | ||
Beginning balance | 39 | (8) |
Other comprehensive income (loss) before reclassifications, net of tax | 8 | |
Amounts reclassified from accumulated other comprehensive (income) loss, net of tax | 1 | |
Other comprehensive income (loss), net of tax | 9 | (83) |
Ending balance | 48 | $ (91) |
Derivative Instruments [Member] | ||
AOCI roll forward | ||
Beginning balance | (9) | |
Amounts reclassified from accumulated other comprehensive (income) loss, net of tax | 1 | |
Other comprehensive income (loss), net of tax | 1 | |
Ending balance | (8) | |
Available for Sale Securities [Member] | ||
AOCI roll forward | ||
Beginning balance | 49 | |
Other comprehensive income (loss) before reclassifications, net of tax | (5) | |
Other comprehensive income (loss), net of tax | (5) | |
Ending balance | 44 | |
Foreign Currency Translation Adjustments [Member] | ||
AOCI roll forward | ||
Beginning balance | (1) | |
Other comprehensive income (loss) before reclassifications, net of tax | 13 | |
Other comprehensive income (loss), net of tax | 13 | |
Ending balance | $ 12 |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Tax Impact (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Derivative Instruments [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Other comprehensive income (loss) before reclassifications, tax | $ 0 |
Amounts reclassified from accumulated other comprehensive (income) loss, tax | 0 |
Available for Sale Securities [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Other comprehensive income (loss) before reclassifications, tax | (2) |
Amounts reclassified from accumulated other comprehensive (income) loss, tax | 0 |
Foreign Currency Translation Adjustments [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Other comprehensive income (loss) before reclassifications, tax | 0 |
Amounts reclassified from accumulated other comprehensive (income) loss, tax | 0 |
Post - Retirement Benefit Obligations [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Other comprehensive income (loss) before reclassifications, tax | 0 |
Amounts reclassified from accumulated other comprehensive (income) loss, tax | $ 0 |
Common Stock Repurchase Progr_2
Common Stock Repurchase Program (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | |
Feb. 28, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | |
Accelerated Share Repurchases [Line Items] | |||
Cash paid for repurchase of common stock | $ 250 | $ 402 | |
Authorized share repurchases | $ 1,100 | ||
Accelerated Share Repurchase Agreement (ASR) [Member] | |||
Accelerated Share Repurchases [Line Items] | |||
Cash paid for repurchase of common stock | $ 250 | ||
Shares repurchased (in shares) | 1.8 | ||
Stock price (in dollars per share) | $ 110.56 |
Fair Value Measurements - Recur
Fair Value Measurements - Recurring (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Available-for-sale Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment maturity | 9 years | |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | $ 925 | $ 969 |
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents and money market funds | 419 | 530 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Available-for-sale Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 457 | 390 |
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Redeemable Preferred Stock [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | $ 49 | $ 49 |
Fair Value Measurements - Debt
Fair Value Measurements - Debt (Detail) - USD ($) $ in Billions | Mar. 31, 2021 | Dec. 31, 2020 |
Reported Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of debt | $ 13.5 | $ 13.8 |
Significant Other Observable Inputs (Level 2) [Member] | Estimate of Fair Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of debt | $ 14.1 | $ 15.2 |
Variable Interest Entities (Det
Variable Interest Entities (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | |
Variable Interest Entity [Line Items] | |||
Carrying value of debt | $ 13,488 | $ 13,810 | |
Assets | 29,070 | 29,345 | |
Variable Interest Entity, Primary Beneficiary [Member] | |||
Variable Interest Entity [Line Items] | |||
Assets | 115 | 114 | |
Investment In Low Income Housing Properties [Member] | Variable Interest Entity, Not Primary Beneficiary [Member] | |||
Variable Interest Entity [Line Items] | |||
Aggregate investment balance | 220 | 228 | |
Equity method investments debt balance | 196 | 210 | |
Refined Coal Facility [Member] | |||
Variable Interest Entity [Line Items] | |||
Equity method investments impairment charges | $ 7 | ||
Trust For Final Capping, Closure, Post-closure Or Environmental Remediation Obligations [Member] | Variable Interest Entity, Not Primary Beneficiary [Member] | |||
Variable Interest Entity [Line Items] | |||
Aggregate investment balance | $ 108 | $ 106 |