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WMI posts steep loss
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November 9, 1999: 7:30 p.m. ET
Trash-hauling company misses estimate, declines to give 4Q guidance
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NEW YORK (CNNfn) - Embattled trash-hauling firm Waste Management Inc. reported a steep third-quarter loss Tuesday that included more than $1.2 billion in special charges.
However, even factoring out those special items, some of which are recurring, the company still managed to miss Wall Street's earnings estimate by 3 cents per share.
The Houston-based Waste Management (WMI), the nation's largest trash-hauling company, posted earnings excluding special charges and unusual expenses of $279.2 million, or 44 cents per share, for the period ended Sept. 30.
That not only was down from the 49 cents per share it earned a year earlier, but it also missed the third-quarter consensus analyst estimate of 47 cents per share, as reported by research firm First Call Corp.
Including special charges, the company lost $947.8 million, or $1.53 per share, down from the $1.29 billion, or $2.11 per share, it lost a year earlier.
A large chunk of the nearly $1.3 billion in charges and unusual expenses were related to accounting irregularities uncovered during an internal review of the company's books.
As a result of those charges, Waste Management reported that it had to obtain waivers from each of its four bank groups to enable the company to be in full compliance and have full access to its bank credit facilities.
Waivers for the two domestic bank agreements extend through Dec. 30, although company officials said they are seeking permanent amendments to those credit facilities to allow it to divest of some assets.
Waivers for the two European facilities expire on Nov. 25, although company officials are negotiating further extensions.
With those facilities and future charges as of yet unknown, Waste Management officials declined to provide any guidance on the fourth-quarter earnings. However, the company is hoping to find some stability under new Chief Executive Officer A. Maurice Myers, appointed earlier Tuesday.
On an operational basis, Waste Management recorded third-quarter revenues of $3.39 billion, up 4.3 percent from a year earlier, while its operating cash flow improved slightly to approximately $500 million.
For the year so far, the company's operating revenues are up 3.4 percent to $9.79 billion.
Waste Management's net loss, after special charges, for the year's first nine months decreased 66 percent to $282.8 million, or 46 cents per share. Including those charges, earnings for the same period were $944.2 million, or $1.49 per share.
Waste Management shares lost 5/8 to 17-3/4 in trading Tuesday. The company's shares were not opened for after-hours trading.
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Waste Management Inc.
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