10.SEGMENT REPORTING

The Company’s revenues are generated from the collection, transfer, recycling and disposal of non-hazardous solid waste and the treatment, recovery and disposal of non-hazardous E&P waste. No single contract or customer accounted for more than 10% of the Company’s total revenues at the consolidated or reportable segment level during the periods presented.

The Company manages its operations through five geographic operating segments and its E&P segment, which includes the majority of the Company’s E&P waste treatment and disposal operations. The Company’s five geographic operating segments and its E&P segment comprise the Company’s reportable segments. Each operating segment is responsible for managing several vertically integrated operations, which are comprised of districts. In the third quarter of 2017, the Company moved a district from the Eastern segment to the Canada segment as a significant amount of its revenues are received from Canadian-based customers. The segment information presented herein reflects the realignment of this district.

Under the current orientation, the Company’s Southern segment services customers located in Alabama, Arkansas, Florida, Louisiana, Mississippi, southern Oklahoma, western Tennessee and Texas; the Company’s Western segment services customers located in Alaska, California, Idaho, Montana, Nevada, Oregon, Washington and western Wyoming; the Company’s Eastern segment services customers located in Illinois, Iowa, Kentucky, Maryland, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, eastern Tennessee, Vermont and Wisconsin; the Company’s Canada segment services customers located in the state of Michigan and in the provinces of Alberta, British Columbia, Manitoba, Ontario and Québec; and the Company’s Central segment services customers located in Arizona, Colorado, Kansas, Minnesota, Missouri, Nebraska, New Mexico, Oklahoma, South Dakota, western Texas, Utah and eastern Wyoming. The E&P segment services E&P customers located in Arkansas, Louisiana, New Mexico, North Dakota, Oklahoma, Texas, Wyoming and along the Gulf of Mexico.

The Company’s Chief Operating Decision Maker (“CODM”) evaluates operating segment profitability and determines resource allocations based on several factors, of which the primary financial measure is segment EBITDA. The Company defines segment EBITDA as earnings before interest, taxes, depreciation, amortization, impairments and other operating items, other income (expense) and foreign currency transaction gain (loss). Segment EBITDA is not a measure of operating income, operating performance or liquidity under GAAP and may not be comparable to similarly titled measures reported by other companies. The Company’s management uses segment EBITDA in the evaluation of segment operating performance as it is a profit measure that is generally within the control of the operating segments. A reconciliation of segment EBITDA to Income before income tax provision is included at the end of this Note 10.

Summarized financial information concerning the Company’s reportable segments for the three and nine months ended September 30, 2017 and 2016, is shown in the following tables:


Three Months Ended September 30, 2017	Revenue		Intercompany Revenue(b)		Reported Revenue		Segment EBITDA(c)
Southern	$	317,059	$	(36,531)	$	280,528	$	63,171
Western		292,222		(30,345)		261,877		84,861
Eastern		292,124		(45,857)		246,267		74,018
Canada		224,166		(27,111)		197,055		74,369
Central		190,210		(23,850)		166,360		64,607
E&P		56,209		(1,818)		54,391		27,881
Corporate(a)		-		-		-		(5,751)
	$	1,371,990	$	(165,512)	$	1,206,478	$	383,156


Three Months Ended September 30, 2016	Revenue		Intercompany Revenue(b)		Reported Revenue		Segment EBITDA(c)
Southern	$	317,727	$	(37,818)	$	279,909	$	62,189
Western		276,941		(30,050)		246,891		84,214
Eastern		226,680		(34,701)		191,979		57,699
Canada		207,003		(26,431)		180,572		66,235
Central		176,109		(20,842)		155,267		58,079
E&P		33,785		(3,481)		30,304		8,919
Corporate(a)		-		-		-		(18,299)
	$	1,238,245	$	(153,323)	$	1,084,922	$	319,036


Nine Months Ended September 30, 2017	Revenue		Intercompany Revenue(b)		Reported Revenue		Segment EBITDA(c)
Southern	$	957,506	$	(111,472)	$	846,034	$	199,280
Western		845,176		(90,217)		754,959		247,475
Eastern		851,880		(133,578)		718,302		209,315
Canada		621,995		(75,846)		546,149		200,283
Central		536,803		(66,716)		470,087		177,975
E&P		143,951		(6,169)		137,782		63,518
Corporate(a)		-		-		-		(32,535)
	$	3,957,311	$	(483,998)	$	3,473,313	$	1,065,311


Nine Months Ended September 30, 2016	Revenue		Intercompany Revenue(b)		Reported Revenue		Segment EBITDA(c)
Southern	$	497,863	$	(60,485)	$	437,378	$	98,906
Western		789,716		(87,160)		702,556		237,839
Eastern		519,165		(81,361)		437,804		135,456
Canada		281,660		(35,949)		245,711		91,471
Central		468,004		(53,130)		414,874		154,510
E&P		97,883		(8,965)		88,918		21,953
Corporate(a)		-		-		-		(102,653)
	$	2,654,291	$	(327,050)	$	2,327,241	$	637,482

____________________

(a)Corporate functions include accounting, legal, tax, treasury, information technology, risk management, human resources, training and other administrative functions. Amounts reflected are net of allocations to the six operating segments.

(b)Intercompany 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.

(c)For those items included in the determination of segment EBITDA, the accounting policies of the segments are the same as those described in the Company’s most recent Annual Report on Form 10-K.

Total assets for each of the Company’s reportable segments at September 30, 2017 and December 31, 2016, were as follows:


	September 30, 2017		December 31, 2016
Southern	$	2,726,600	$	2,869,841
Western		1,560,023		1,516,870
Eastern		1,999,928		1,519,576
Canada		2,697,750		2,554,324
Central		1,312,209		1,302,900
E&P		989,081		1,068,086
Corporate		624,684		272,328
Total Assets	$	11,910,275	$	11,103,925

The following tables show changes in goodwill during the nine months ended September 30, 2017 and 2016, by reportable segment:



	Southern		Western		Eastern		Canada		Central		E&P			Total
Balance as of December 31, 2016	$	1,470,023	$	376,537	$	533,160	$	1,465,274	$	467,924	$	77,343	$	4,390,261
Goodwill acquired		7,484		20,906		272,501		7,127		1,013		-		309,031
Goodwill divested		(31,543)		-		(4,276)		-		(667)		-		(36,486)
Impairment loss		-		-		-		-		-		(77,343)		(77,343)
Goodwill adjustment for assets sold		2,205		-		321		-		-		-		2,526
Goodwill adjustment for assets held for sale		(11,080)		-		-		-		-		-		(11,080)
Impact of changes in foreign currency		-		-		-		111,439		-		-		111,439
Balance as of September 30, 2017	$	1,437,089	$	397,443	$	801,706	$	1,583,840	$	468,270	$	-	$	4,688,348



	Southern		Western		Eastern		Canada		Central		E&P			Total
Balance as of December 31, 2015	$	95,710	$	373,820	$	459,532	$	-	$	416,420	$	77,343	$	1,422,825
Goodwill acquired		1,338,806		2,696		75,769		1,465,720		48,232		-		2,931,223
Impact of changes in foreign currency		-		-		-		(2,878)		-		-		(2,878)
Balance as of September 30, 2016	$	1,434,516	$	376,516	$	535,301	$	1,462,842	$	464,652	$	77,343	$	4,351,170

A reconciliation of the Company’s primary measure of segment profitability (segment EBITDA) to Income before income tax provision in the Condensed Consolidated Statements of Net Income is as follows:


	Three months ended September 30,				Nine months ended September 30,
	2017		2016		2017		2016
Southern segment EBITDA	$	63,171	$	62,189	$	199,280	$	98,906
Western segment EBITDA		84,861		84,214		247,475		237,839
Eastern segment EBITDA		74,018		57,699		209,315		135,456
Canada segment EBITDA		74,369		66,235		200,283		91,471
Central segment EBITDA		64,607		58,079		177,975		154,510
E&P segment EBITDA		27,881		8,919		63,518		21,953
Subtotal reportable segments		388,907		337,335		1,097,846		740,135
Unallocated corporate overhead		(5,751)		(18,299)		(32,535)		(102,653)
Depreciation		(136,941)		(125,744)		(395,008)		(270,988)
Amortization of intangibles		(26,613)		(26,944)		(76,886)		(48,719)
Impairments and other operating items		(832)		(7,682)		(141,333)		(4,634)
Interest expense		(32,471)		(27,621)		(92,763)		(65,291)
Interest income		1,656		171		3,131		447
Other income (expense), net		1,709		500		3,561		(268)
Foreign currency transaction gain (loss)		(1,864)		(350)		(3,502)		339
Income before income tax provision	$	187,800	$	131,366	$	362,511	$	248,368

The following tables reflect a breakdown of the Company’s revenue and inter-company eliminations for the periods indicated:


	Three months ended September 30, 2017
	Revenue		Intercompany Revenue		Reported Revenue		% of Reported Revenue
Solid waste collection	$	815,344	$	(2,484)	$	812,860		67.4%
Solid waste disposal and transfer		416,764		(157,280)		259,484		21.5
Solid waste recycling		43,864		(2,295)		41,569		3.5
E&P waste treatment, recovery and disposal		57,797		(3,082)		54,715		4.5
Intermodal and other		38,221		(371)		37,850		3.1
Total	$	1,371,990	$	(165,512)	$	1,206,478		100.0%


	Three months ended September 30, 2016
	Revenue		Intercompany Revenue		Reported Revenue		% of Reported Revenue
Solid waste collection	$	760,281	$	(2,472)	$	757,809		69.9%
Solid waste disposal and transfer		377,998		(144,459)		233,539		21.5
Solid waste recycling		32,138		(2,523)		29,615		2.7
E&P waste treatment, recovery and disposal		33,673		(3,608)		30,065		2.8
Intermodal and other		34,155		(261)		33,894		3.1
Total	$	1,238,245	$	(153,323)	$	1,084,922		100.0%


	Nine months ended September 30, 2017
	Revenue		Intercompany Revenue		Reported Revenue		% of Reported Revenue
Solid waste collection	$	2,380,821	$	(7,075)	$	2,373,746		68.3%
Solid waste disposal and transfer		1,189,965		(459,659)		730,306		21.0
Solid waste recycling		131,445		(7,229)		124,216		3.6
E&P waste treatment, recovery and disposal		147,662		(8,921)		138,741		4.0
Intermodal and other		107,418		(1,114)		106,304		3.1
Total	$	3,957,311	$	(483,998)	$	3,473,313		100.0%


	Nine months ended September 30, 2016
	Revenue		Intercompany Revenue		Reported Revenue		% of Reported Revenue
Solid waste collection	$	1,619,827	$	(5,571)	$	1,614,256		69.4%
Solid waste disposal and transfer		804,928		(307,308)		497,620		21.4
Solid waste recycling		60,876		(4,554)		56,322		2.4
E&P waste treatment, recovery and disposal		97,259		(9,228)		88,031		3.8
Intermodal and other		71,401		(389)		71,012		3.0
Total	$	2,654,291	$	(327,050)	$	2,327,241		100.0%