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|The company currently operates 33 recycling facilities. Revenue from recycling is dependent on [[Commodities Prices]], so in trying to reduce exposure to fluctuations in this market, Republic tries to use third-party recycling facilities when possible <ref> RSG 2006 [http://library.corporate-ir.net/library/82/823/82381/items/251934/REPUBLICSERVICE10K.pdf 10-K], Item 1: Business, page 7 </ref>.||The company currently operates 33 recycling facilities. Revenue from recycling is dependent on [[Commodities Prices]], so in trying to reduce exposure to fluctuations in this market, Republic tries to use third-party recycling facilities when possible <ref> RSG 2006 [http://library.corporate-ir.net/library/82/823/82381/items/251934/REPUBLICSERVICE10K.pdf 10-K], Item 1: Business, page 7 </ref>.|
|-||===[[Oil Prices]]===||+||Everyone loves what you guys tend to be up too. This sort of clever work and cgvreaoe! Maintain up the great works guys Ive added you guys to my blog rolls.|
|-||Republic Services operates a fleet of approximately 6,200 collection vehicles<ref> RSG 2006 [http://library.corporate-ir.net/library/82/823/82381/items/251934/REPUBLICSERVICE10K.pdf 10-K], Item 2: Properties, page 17 </ref>., in addition to the transfer facilities and landfill machinery. The cost of these operations is dependent on fuel bought at open market prices, thus subject to the fluctuations of the oil market. Beginning in 2005, Republic became involved in fuel hedges meant to moderate oil price swings<ref> RSG 2006 [http://library.corporate-ir.net/library/82/823/82381/items/251934/REPUBLICSERVICE10K.pdf 10-K], Item 7: Management's Discussion and Analysis of Financial Condition and Results of Operations, page 45 </ref>, but large swings in oil prices could still dramatically affect Republic's bottom line<ref> RSG 2006 [http://library.corporate-ir.net/library/82/823/82381/items/251934/REPUBLICSERVICE10K.pdf 10-K], Item 1A: Risk Factors, page 13 </ref>.||+|
|== Competition ==||== Competition ==|
Republic Services (NYSE: RSG) is the third second trash company in the United States. Like its major competitor, Waste Management (WMI), Republic serves its customers by collecting, transferring, and disposing of waste in both Republic-owned and third-party landfills. Although Republic operates fewer landfills than its competitors, the company focuses on markets with high population growth and has success in establishing trash collection and disposal monopolies in many of its key markets.
Republic Services provides non-hazardous solid waste collection services for commercial, industrial, municipal and residential customers through 376 collection companies in 40 states and Puerto Rico. The Company owns or operates 223 transfer stations, 192 active solid waste landfills and 78 recycling facilities. It also operates 74 landfill gas and renewable energy projects.
First Quarter 2010 Results (ended March 31, 2010)
Republic reported net income of $65.0 million, or $0.17 per diluted share, including a loss on the extinguishment of debt, versus $113.0 million, or $0.30 per diluted share, for the comparable period last year. Revenue for the quarter was $1,957.7 million compared to $2,060.5 million for the same period in 2009.
Within the collection line of business, 35% of Republic's revenue is from services provided to municipal and residential customers, 40% is from services provided to commercial customers, and 25% is from services provided to industrial and other customers. The Company’s residential collection operations involve the curbside collection of refuse from small containers into collection vehicles for transport to transfer stations or directly to landfills. Residential solid waste collection services are performed under contracts with municipalities. These contracts or franchises usually range in duration from one to five years, although some of its franchises are for significantly longer periods. Residential solid waste collection services may also be performed on a subscription basis, in which individual households contract directly with the company.
In its commercial and industrial collection operations, Republic supplies its customers with waste containers of varying sizes. It also rents compactors to waste generators. Commercial collection services are performed under one- to three-year service agreements, and fees are determined by considerations, such as market factors, collection frequency, type of equipment furnished, the type and volume or weight of the waste collected, transportation costs, the distance to the disposal facility, and the cost of disposal. Republic also provides waste collection services to industrial and construction facilities on a contractual basis with terms ranging from a single pickup to one year or longer. The Company’s construction services are provided to the commercial construction and home building sectors. The company collects the containers or compacted waste and transport the waste either to a landfill or a transfer station for disposal.
Republic also provides recycling services in certain markets in compliance with local laws or the terms of its franchise agreements. These services include the curbside collection of residential recyclable waste and the provision of a variety of recycling services to commercial and industrial customers.
Republic Services deposits waste at its transfer stations, as do other private haulers and municipal haulers, for compacting and transfer to trailers for transport to disposal sites or recycling facilities. As of December 31, 2009, Republic owned or operated 192 active landfills, which had approximately 35,000 permitted acres and total available permitted and probable expansion disposal capacity of approximately 4.6 billion in-place cubic yards. Some of its landfills accept non-hazardous special waste, including utility ash, asbestos and contaminated soils.
During 2009, the Company brought 11 landfill gas-to-energy projects on line, bringing its total number of such projects to 74 or over one third of its active landfills. These projects include 51 electric generating plants powered by landfill gas, four medium British thermal unit plants that provide landfill gas to industrial users, six high British thermal unit plants that produce pipeline quality gas, and three projects that use landfill gas to power leachate evaporating equipment. The Company’s 51 electric projects generate 323 megawatts of electricity, enough to power approximately 192,000 homes. Its 23 other projects provide or process more than 58,000 square cubic feet per minute of gas, enough to heat almost 200,000 homes.
Republic owns or operates 78 materials recovery facilities and other recycling operations. These facilities sort recyclable paper, aluminum, glass and other materials. Most of these recyclable materials are internally collected by its residential collection operations. In some areas, the Company receives commercial and industrial solid waste that is sorted at its facilities into recyclable materials and non-recyclable waste. The recyclable materials are salvaged, repackaged and sold to third parties, and the non-recyclable waste is disposed of at landfills or incinerators.
The waste management industry is tightly regulated by the Environmental Protection Agency (EPA), in addition to other federal, state, and local agencies. Waste management operations vary widely from market to market, and depending on the government level of of the regulating agency, new regulations can significantly impact Republic's revenue (i.e. changes to landfill regulation in California won't impact revenue as much as if the EPA were to change landfill regulations for the entire country). Violating governmental regulations can carry stiff penalties and fines plus the cost of cleanup of any hazardous materials.
In the last decade, the amount of waste generated in the United States has increased by more than 17%, while the total number of active landfills has decreased by more than 43%. Offsetting this disparity, in the last sixteen years, the amount of material recovery (recycling) has increased 18%. The landfill permitting process has become so extensive that the current trend of landfill capacity decreasing while waste generation increases is expected to continue for the foreseeable future. Republic is in the process of applying to expand capacity at certain landfills. Approximately 56% of the waste collected by Republic Services is disposed of at Republic-owned landfills, a rate that is lower than its competitors; Republic must pay significant fees to third-party landfill operators, and as overall landfill capacity declines these fees are expected to increase.
The company currently operates 33 recycling facilities. Revenue from recycling is dependent on Commodities Prices, so in trying to reduce exposure to fluctuations in this market, Republic tries to use third-party recycling facilities when possible .
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Republic Services is the second largest waste management company in the United States (based on revenue). Its main corporate competitor is Waste Management (WMI). Additional smaller competitors exist in individual markets, such as Waste Connections in the Southern and Western United States.
Waste Management (WM) offers a broader range of services and products including: hazardous waste landfills and disposal, renewable energy harvested from its landfills (natural gas), and other alternative energy options.
Because Republic operates the fewest landfills, it must pay significant fees for its collection companies to dispose of waste in third-party landfills.
|Waste Management (WM)||Republic Services (RSG)|
|2009 Revenue ($ mil)||$11,920||$8,100|