XML 39 R18.htm IDEA: XBRL DOCUMENT v3.19.2
Segment Reporting
6 Months Ended
Jun. 30, 2019
Segment Reporting [Abstract]  
Segment Reporting

11.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 first quarter of 2019, the Company moved two districts from the Eastern segment to the Central segment because their locations in Iowa were closer in proximity to operations in the Company’s Central segment.  The segment information presented herein reflects the realignment of these districts.

Under the current orientation, the Company’s Eastern segment services customers located in northern Illinois, Kentucky, Maryland, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, eastern Tennessee, Vermont, Virginia and Wisconsin; the Company’s Southern segment services customers located in Alabama, Arkansas, Florida, Georgia, 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 Central segment services customers located in Arizona, Colorado, Iowa, southern Illinois, Kansas, Minnesota, Missouri, Nebraska, New Mexico, Oklahoma, South Dakota, western Texas, Utah and eastern Wyoming; and the Company’s Canada segment services customers located in the state of Michigan and in the provinces of Alberta, British Columbia, Manitoba, Ontario, Québec and Saskatchewan. 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 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 11.

Summarized financial information concerning the Company’s reportable segments for the three and six months ended June 30, 2019 and 2018, is shown in the following tables:

Three Months Ended

    

    

Intercompany

    

Reported

    

Segment

June 30, 2019

Revenue

Revenue(b)

Revenue

EBITDA(c)

Eastern

$

390,476

$

(66,855)

$

323,621

$

85,048

Southern

339,461

(41,446)

298,015

74,511

Western

 

311,702

 

(34,704)

 

276,998

 

86,440

Central

 

250,467

 

(32,106)

 

218,361

 

74,506

Canada

 

216,306

 

(27,779)

 

188,527

 

67,664

E&P

 

67,016

 

(2,899)

 

64,117

 

33,433

Corporate(a)

 

 

 

 

(7,446)

$

1,575,428

$

(205,789)

$

1,369,639

$

414,156

Three Months Ended

    

    

Intercompany

    

Reported

    

Segment

June 30, 2018

Revenue

Revenue(b)

Revenue

EBITDA(c)

Eastern

$

320,404

$

(53,945)

$

266,459

$

73,755

Southern

321,051

(37,941)

283,110

68,787

Western

 

295,730

 

(32,031)

 

263,699

 

81,175

Central

 

207,209

 

(27,705)

 

179,504

 

64,172

Canada

 

211,787

 

(24,949)

 

186,838

 

67,305

E&P

 

61,765

 

(1,407)

 

60,358

 

31,231

Corporate(a)

 

 

 

 

260

$

1,417,946

$

(177,978)

$

1,239,968

$

386,685

Six Months Ended

    

    

    

    

June 30, 

Intercompany

Reported

Segment

2019

Revenue

Revenue(b)

Revenue

EBITDA(c)

Eastern

$

737,323

$

(120,875)

$

616,448

$

162,005

Southern

663,942

(78,599)

585,343

148,889

Western

 

597,877

 

(65,900)

 

531,977

 

163,444

Central

 

453,260

 

(57,022)

 

396,238

 

137,534

Canada

 

406,591

 

(49,717)

 

356,874

 

126,908

E&P

 

133,050

 

(5,655)

 

127,395

 

65,042

Corporate(a)

 

 

 

 

(11,304)

$

2,992,043

$

(377,768)

$

2,614,275

$

792,518

Six Months Ended

    

    

    

    

June 30, 

Intercompany

Reported

Segment

2018

Revenue

Revenue(b)

Revenue

EBITDA(c)

Eastern

$

603,952

$

(99,905)

$

504,047

$

140,040

Southern

630,007

(73,558)

556,449

137,694

Western

 

570,850

 

(61,988)

 

508,862

 

153,832

Central

 

386,700

 

(49,116)

 

337,584

 

123,742

Canada

 

403,475

 

(46,662)

 

356,813

 

126,571

E&P

 

119,385

 

(3,041)

 

116,344

 

59,910

Corporate(a)

 

 

 

 

(6,083)

$

2,714,369

$

(334,270)

$

2,380,099

$

735,706

____________________

(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 June 30, 2019 and December 31, 2018, were as follows:

June 30, 

December 31, 

    

2019

    

2018

Eastern

$

2,720,643

$

2,673,316

Southern

 

2,965,048

 

2,892,994

Western

1,680,268

1,596,129

Central

1,880,010

1,506,326

Canada

2,496,286

2,412,971

E&P

974,023

969,808

Corporate

429,494

575,785

Total Assets

 

$

13,145,772

 

$

12,627,329

The following tables show changes in goodwill during the six months ended June 30, 2019 and 2018, by reportable segment:

    

Eastern

    

Southern

    

Western

    

Central

    

Canada

    

E&P

    

Total

Balance as of December 31, 2018

$

1,143,355

$

1,517,610

$

398,174

$

523,566

$

1,448,980

$

$

5,031,685

Goodwill transferred

(16,869)

16,869

Goodwill acquired

 

25,294

 

7,726

1,122

 

190,383

 

224,525

Goodwill acquisition adjustments

(173)

(173)

Goodwill divested

 

 

(845)

 

 

 

 

 

(845)

Impact of changes in foreign currency

 

 

 

 

 

61,478

 

 

61,478

Balance as of June 30, 2019

$

1,151,780

$

1,524,491

$

399,296

$

730,818

$

1,510,285

$

$

5,316,670

    

    Eastern    

    

Southern

    

Western

    

Central

    

Canada

    

E&P

    

Total

Balance as of December 31, 2017

$

804,133

$

1,436,320

$

397,508

$

468,275

$

1,575,538

$

$

4,681,774

Goodwill transferred

(16,869)

16,869

Goodwill acquired

 

120,979

 

4,909

 

666

 

39,155

 

 

 

165,709

Impact of changes in foreign currency

 

 

 

 

 

(74,517)

 

 

(74,517)

Balance as of June 30, 2018

$

908,243

$

1,441,229

$

398,174

$

524,299

$

1,501,021

$

$

4,772,966

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

Six months ended

June 30, 

June 30, 

    

2019

    

2018

    

2019

    

2018

    

Eastern segment EBITDA

$

85,048

$

73,755

$

162,005

$

140,040

Southern segment EBITDA

74,511

68,787

148,889

137,694

Western segment EBITDA

 

86,440

 

81,175

 

163,444

 

153,832

Central segment EBITDA

 

74,506

 

64,172

 

137,534

 

123,742

Canada segment EBITDA

 

67,664

 

67,305

 

126,908

 

126,571

E&P segment EBITDA

 

33,433

 

31,231

 

65,042

 

59,910

Subtotal reportable segments

 

421,602

 

386,425

 

803,822

 

741,789

Unallocated corporate overhead

 

(7,446)

 

260

 

(11,304)

 

(6,083)

Depreciation

 

(156,776)

 

(142,450)

 

(303,623)

 

(275,634)

Amortization of intangibles

 

(31,344)

 

(26,474)

 

(61,886)

 

(52,573)

Impairments and other operating items

 

(3,902)

 

(7,073)

 

(20,014)

 

(8,104)

Interest expense

 

(37,245)

 

(32,426)

 

(74,533)

 

(64,796)

Interest income

 

1,818

 

1,056

 

5,129

 

2,210

Other income, net

 

805

 

2,031

 

3,363

 

1,644

Foreign currency transaction gain (loss)

 

1,115

 

30

 

1,218

 

(190)

Income before income tax provision

$

188,627

$

181,379

$

342,172

$

338,263