Republic Services Inc (RSG) 2022 Q3 法說會逐字稿

Good afternoon, and welcome to the Republic Services Third Quarter 2022 Investor Conference Call. Republic Services is traded on the New York Stock Exchange under the symbol RSG. (Operator Instructions) Please note, this event is being recorded.

下午好，歡迎參加共和國服務公司 2022 年第三季度投資者電話會議。 Republic Services 在紐約證券交易所上市，交易代碼為 RSG。 （操作員說明）請注意，此事件正在記錄中。

I would now like to turn the conference over to Aaron Evans, Vice President of Investor Relations. Please go ahead.

我現在想將會議轉交給投資者關係副總裁 Aaron Evans。請繼續。

I would like to welcome everyone to Republic Services Third Quarter 2022 Conference Call. Jon Vander Ark, our CEO; and Brian DelGhiaccio, our CFO, are joining me as we discuss our performance.

我想歡迎大家參加共和服務 2022 年第三季度電話會議。我們的首席執行官 Jon Vander Ark；我們的首席財務官 Brian DelGhiaccio 和我一起討論我們的業績。

I would like to take a moment to remind everyone that some of the information we discuss on today's call contains forward-looking statements, which involve risks and uncertainties and may be materially different from our actual results. Our SEC filings discuss factors that cause actual results -- that could cause actual results to differ materially from expectations.

我想花一點時間提醒大家，我們在今天的電話會議上討論的一些信息包含前瞻性陳述，這些陳述涉及風險和不確定性，可能與我們的實際結果存在重大差異。我們提交給美國證券交易委員會的文件討論了導致實際結果的因素——這可能導致實際結果與預期大相徑庭。

The material that we discuss today is time-sensitive. If, in the future, you listen to a rebroadcast or recording of this conference call, you should be sensitive to the date of the original call, which is October 27, 2022.

我們今天討論的材料具有時間敏感性。如果將來您收聽此電話會議的轉播或錄音，您應該對原始電話會議的日期（即 2022 年 10 月 27 日）保持敏感。

Please note that this call is property of Republic Services, Inc. Any redistribution, retransmission or rebroadcast of this call in any form without the expressed written consent of Republic Services is strictly prohibited.

請注意，此電話是共和服務公司的財產。未經共和服務的明確書面同意，嚴禁以任何形式重新分發、轉播或轉播此電話。

I want to point out that our SEC filings, our earnings press release, which includes GAAP reconciliation tables and the discussion of business activities, along with the recording of this call, are available on Republic's website at republicservices.com.

我想指出，我們的 SEC 文件、我們的收益新聞稿，包括 GAAP 調節表和商業活動討論，以及這次電話會議的錄音，都可以在 Republicservices.com 的網站上找到。

I want to remind you that Republic's management team routinely participates in investor conferences. When events are scheduled, the dates, times and presentations are posted on our website.

我想提醒您，Republic 的管理團隊經常參加投資者會議。安排活動後，日期、時間和演示文稿會發佈在我們的網站上。

With that, I would like to turn the call over to Jon.

有了這個，我想把電話轉給喬恩。

Thanks, Aaron. Good afternoon, everyone, and thank you for joining us. Our strong results in the third quarter demonstrate our ability to profitably grow the business and effectively manage our cost structure even with increased volatility in the broader marketplace. Cost pressures remain elevated and more persistent than we originally anticipated. In the face of those cost headwinds, we are leveraging our tools and technology to price ahead of cost inflation and drive margin expansion in the underlying business.

謝謝，亞倫。大家下午好，感謝您加入我們。我們在第三季度的強勁業績表明，即使在更廣泛的市場波動加劇的情況下，我們也有能力以盈利方式發展業務並有效管理我們的成本結構。成本壓力仍然比我們最初預期的要高且更加持久。面對這些成本逆風，我們正在利用我們的工具和技術在成本膨脹之前進行定價，並推動基礎業務的利潤率擴張。

From our perspective, customer demand remains strong and supportive of continued volume growth. The sound fundamentals in our business, together with a laser focus on the customer, position us well to capitalize on growth opportunities in the market.

從我們的角度來看，客戶需求依然強勁，並支持銷量的持續增長。我們業務的良好基礎，加上對客戶的高度關注，使我們能夠很好地利用市場的增長機會。

During the third quarter, we delivered revenue growth of 23%, including over 12% from acquisitions; generated adjusted earnings per share of $1.34, which is a 20% increase over the prior year; and produced more than $1.6 billion of adjusted free cash flow on a year-to-date basis, a 23% increase over the prior year.

第三季度，我們實現了 23% 的收入增長，其中超過 12% 來自收購；調整後每股收益為 1.34 美元，比上年增長 20%；年初至今產生了超過 16 億美元的調整後自由現金流，比上年增長 23%。

We remain confident that investing in value-creating acquisitions is the highest and best use of our cash flow. Year-to-date, we invested $2.6 billion of acquisitions, which includes the acquisition of US Ecology. The integration of US Ecology is progressing as planned, and we remain confident that we will achieve at least $40 million of cost synergies.

我們仍然相信，投資於創造價值的收購是我們現金流的最高和最佳用途。年初至今，我們投資了 26 億美元的收購，其中包括對 US Ecology 的收購。美國生態的整合正在按計劃進行，我們仍然有信心實現至少 4000 萬美元的成本協同效應。

Our initial pricing actions have been successful. We will continue to increase prices to ensure that all stages of the value chain earn an appropriate return. We are also gaining traction cross-selling our products and services, achieving over $25 million in new sales to date.

我們最初的定價行動是成功的。我們將繼續提高價格，以確保價值鏈的各個階段都能獲得適當的回報。我們的產品和服務的交叉銷售也越來越受歡迎，迄今為止新銷售額超過 2500 萬美元。

Apart from US Ecology, we have invested over $400 million of acquisitions this year. Substantially, all of these deals are in the recycling and solid waste space. Our robust acquisition pipeline continues to support outsized levels of activity over the coming years. Year-to-date, we returned $640 million to our shareholders through dividends and share repurchases. We continue to invest for the future and advance our strategic initiatives to build distinctive capabilities in customers' yield, digital and sustainability.

除了美國生態，我們今年還投資了超過 4 億美元的收購。基本上，所有這些交易都在回收和固體廢物領域。我們強大的收購渠道將繼續支持未來幾年的超大規模活動。年初至今，我們通過股息和股票回購向股東返還了 6.4 億美元。我們將繼續為未來投資並推進我們的戰略計劃，以在客戶收益、數字化和可持續性方面建立獨特的能力。

With respect to customers' yield, we delivered organic volume growth of 2.2% during the third quarter. Volume growth was broad-based across our market verticals and geographies. We also demonstrated our ongoing ability to price in excess of underlying cost inflation. Core price increased to 6.9% and average yield increased to 5.6%. This is the highest level of pricing in company history.

在客戶收益方面，我們在第三季度實現了 2.2% 的有機銷量增長。銷量增長在我們的垂直市場和地域範圍內廣泛存在。我們還展示了我們持續定價超過潛在成本通脹的能力。核心價格上漲至 6.9%，平均收益率上漲至 5.6%。這是公司歷史上最高的定價水平。

Moving on to our digital capabilities. The team continues to advance the implementation of digital tools and improve the experience for both customers and employees. Our proprietary RISE tablets have been fully deployed across our large and small container route, and deployment to residential route is 26% complete. The remaining residential routes are on track for completion by mid-2023. We have also launched Track My Truck. This technology connects the customer to their large and small container truck utilizing a GPS-enabled RISE tablet. This is a major milestone that serves as a foundation for further digital offerings to our customers.

繼續我們的數字能力。該團隊繼續推進數字工具的實施，並改善客戶和員工的體驗。我們專有的 RISE 平板電腦已在我們的大型和小型集裝箱路線上全面部署，住宅路線的部署已完成 26%。其餘住宅路線有望在 2023 年年中完成。我們還推出了 Track My Truck。該技術使用支持 GPS 的 RISE 平板電腦將客戶連接到他們的大型和小型集裝箱卡車。這是一個重要的里程碑，為我們的客戶提供進一步的數字產品奠定了基礎。

As it relates to sustainability, development of our renewable gas projects remains on track. We expect the first tranche of these projects related to our joint venture to come online beginning in late 2023. We are pleased to work with bp on these RNG projects, who recently announced its intent to acquire Archaea. This provides additional opportunities to work together on decarbonization and environmental services initiatives.

由於它與可持續性有關，我們的可再生天然氣項目的開發仍在正常進行。我們預計與我們的合資企業相關的第一批項目將於 2023 年底上線。我們很高興與 bp 就這些 RNG 項目合作，後者最近宣布有意收購 Archaea。這為在脫碳和環境服務倡議方面開展合作提供了更多機會。

Regarding polymer centers, we are accelerating the development of these projects and now expect to invest an additional $40 million of capital this year to start working on future locations.

關於聚合物中心，我們正在加速這些項目的開發，現在預計今年將額外投資 4000 萬美元，以開始在未來的地點開展工作。

Finally, our company values guide everything we do. I'm proud of our recent certification as a Great Place to Work for the sixth consecutive year. This is a significant achievement as employee retention and recruiting remains a top priority in today's market.

最後，我們的公司價值觀指導著我們所做的一切。我為我們最近連續第六年獲得最佳工作場所認證感到自豪。這是一項重大成就，因為員工保留和招聘仍然是當今市場的重中之重。

I will now turn the call over to Brian, who will provide details on the quarter.

我現在將把電話轉給布賴恩，他將提供本季度的詳細信息。

Thanks, Jon. Core price during the third quarter was 6.9%, which included open market pricing of 8.7% and restricted pricing of 4%. The components of core price included small container of 10.7%, large container of 7.6% and residential of 6.7%. Average yield on total revenue was 5.6%, an increase of 60 basis points when compared to our second quarter performance. Average yield on related revenue was 6.3%.

謝謝，喬恩。第三季度核心價格為 6.9%，其中包括公開市場定價 8.7% 和限制性定價 4%。核心價格的構成包括小型集裝箱 10.7%、大型集裝箱 7.6% 和住宅 6.7%。總收入的平均收益率為 5.6%，與我們第二季度的業績相比增加了 60 個基點。相關收入的平均收益率為 6.3%。

The team continues to dynamically adjust price on new and existing business to offset higher levels of inflation in our operating costs and capital expenditures. Third quarter volume increased 2.2%. The components of volume included an increase in small container of 2.3%, an increase in large container of 1.7% and an increase in landfill of 6.8%. Our customer retention rate remained strong at over 94%.

該團隊繼續動態調整新業務和現有業務的價格，以抵消我們運營成本和資本支出的較高通脹水平。第三季度銷量增長 2.2%。體積組成部分包括小容器增加 2.3%、大容器增加 1.7% 和垃圾填埋場增加 6.8%。我們的客戶保留率保持在 94% 以上。

Moving on to recycling. Commodity prices were $162 per ton in the quarter. This compares to $230 per ton in the prior year. Recycling processing and commodity sales were a 130 basis point headwind to internal growth during the quarter. We are now forecasting fourth quarter commodity prices to be approximately $90 per ton. This would result in a full year average commodity price of $165 per ton.

繼續回收。本季度商品價格為每噸 162 美元。相比之下，前一年為每噸 230 美元。回收加工和商品銷售對本季度的內部增長造成了 130 個基點的阻力。我們現在預測第四季度商品價格約為每噸 90 美元。這將導致全年平均商品價格為每噸 165 美元。

Next, turning to our environmental solutions business. Third quarter environmental solutions revenue increased $343 million over the prior year, which primarily relates to the acquisition of US Ecology. On a same-store basis, environmental solutions contributed 60 basis points to internal growth during the quarter. Adjusted EBITDA margin for the environmental solutions business was 18.7%, a sequential increase of 160 basis points. This includes our existing operations in the Gulf and Northeast, together with the addition of US Ecology.

接下來，轉向我們的環境解決方案業務。第三季度環境解決方案收入比上年增加了 3.43 億美元，這主要與收購 US Ecology 有關。在同店的基礎上，環境解決方案為本季度的內部增長貢獻了 60 個基點。環境解決方案業務的調整後 EBITDA 利潤率為 18.7%，環比增長 160 個基點。這包括我們在海灣和東北部的現有業務，以及美國生態系統的加入。

Total company adjusted EBITDA margin for the third quarter was 29.2%. This compares to 30.5% in the prior year. Margin performance during the quarter included a 150 basis point decrease from acquisitions, including 90 basis points related to US Ecology and a 40 basis point headwind from lower commodity prices. These margin headwinds were partially offset by a 10 basis point increase from net fuel and underlying margin expansion of 50 basis points.

第三季度公司調整後的 EBITDA 總利潤率為 29.2%。相比之下，上一年為 30.5%。本季度的利潤率表現包括收購下降 150 個基點，其中包括與美國生態相關的 90 個基點和商品價格下跌帶來的 40 個基點。這些利潤率逆風被淨燃料增加 10 個基點和潛在利潤率擴大 50 個基點部分抵消。

Adjusted EBITDA margin in the recycling and solid waste business was 30.5%. SG&A expenses, excluding transaction costs from US Ecology, were 9.8% of revenue. This is a 30 basis point improvement over the prior year and reflects continued cost management as we grow the business. Year-to-date adjusted free cash flow was $1.67 billion, an increase of $309 million or 23% compared to the prior year. This was driven almost exclusively by EBITDA growth in the business.

回收和固體廢物業務的調整後 EBITDA 利潤率為 30.5%。 SG&A 費用（不包括美國生態的交易成本）佔收入的 9.8%。這比上一年提高了 30 個基點，反映了我們在業務發展過程中的持續成本管理。年初至今調整後的自由現金流為 16.7 億美元，比上年增加 3.09 億美元或 23%。這幾乎完全是由業務的 EBITDA 增長推動的。

Similar to prior years, we expect to spend a disproportionate amount of our full year CapEx and cash taxes during the fourth quarter. Year-to-date net capital expenditures of $808 million represents a little more than half of our projected full year spend. And year-to-date adjusted cash taxes of $115 million represents 50% of our projected full year spend.

與往年類似，我們預計第四季度將花費不成比例的全年資本支出和現金稅。年初至今的 8.08 億美元淨資本支出占我們預計全年支出的一半多一點。年初至今調整後的現金稅為 1.15 億美元，占我們預計全年支出的 50%。

Total debt was $11.8 billion, and total liquidity was $1.9 billion. Variable interest rates on our debt increased 1% during the third quarter and an additional 50 basis points in October. As a reminder, a 1% increase in interest rates results in $36 million of additional annual interest expense. Our leverage ratio at the end of the quarter was approximately 3.2x. We expect to revert to 3x leverage by mid-2023.

總債務為 118 億美元，總流動資金為 19 億美元。我們債務的浮動利率在第三季度增加了 1%，在 10 月份又增加了 50 個基點。提醒一下，利率增加 1% 會導致每年額外增加 3600 萬美元的利息支出。我們在本季度末的槓桿率約為 3.2 倍。我們預計到 2023 年年中將恢復到 3 倍的槓桿率。

With respect to taxes. Our combined tax rate and noncash charges from solar investments resulted in an equivalent tax impact of 25.1% during the third quarter and 24.8% on a year-to-date basis. We expect an equivalent tax impact in a range of 28% to 29% in the fourth quarter and an equivalent tax impact of just under 26% for the year.

關於稅收。我們從太陽能投資產生的綜合稅率和非現金費用在第三季度產生了 25.1% 的等效稅收影響，在今年迄今為 24.8%。我們預計第四季度的等效稅收影響在 28% 至 29% 之間，而今年的等效稅收影響將略低於 26%。

I will now turn the call back over to Jon.

我現在將把電話轉回給喬恩。

We are proud of the results we delivered during the third quarter, which exceeded our expectations. Stronger contribution from price more than offset persistent cost inflation, which we have seen stabilize but not retreat from elevated levels. That said, we remain comfortable with our full year financial guidance we provided in July even with the recent drop in recycled commodity prices and increase in interest rate.

我們為第三季度的業績感到自豪，這超出了我們的預期。價格的強勁貢獻抵消了持續的成本通脹，我們已經看到成本穩定但並未從高位回落。也就是說，即使最近再生商品價格下跌和利率上升，我們仍然對 7 月份提供的全年財務指導感到滿意。

Looking forward to 2023, the fundamentals of our business remain strong. Recent decreases in recycled commodity prices, increased interest rates and rising fuel costs will have a direct impact on our business. While these headwinds may modulate our performance expectations, we remain confident in our ability to price ahead of cost inflation. We still expect to deliver above-average levels of growth in revenue, EBITDA and free cash flow. We plan to provide detailed 2023 guidance on our fourth quarter earnings call in February.

展望 2023 年，我們的業務基本面依然強勁。近期再生商品價格下跌、利率上升和燃料成本上升將對我們的業務產生直接影響。儘管這些不利因素可能會影響我們的業績預期，但我們仍然對我們在成本通脹之前進行定價的能力充滿信心。我們仍然預計收入、EBITDA 和自由現金流的增長將高於平均水平。我們計劃在 2 月份的第四季度財報電話會議上提供詳細的 2023 年指導。

With that, operator, I would like to open the call to questions.

有了這個，接線員，我想打開問題電話。

(Operator Instructions) And our first question will come from Tyler Brown of Raymond James.

（操作員說明）我們的第一個問題將來自 Raymond James 的 Tyler Brown。

Jon, I just wanted to start on US Ecology. Curious how things are progressing there. It sounds like your September price spiked up, but can you just talk about how that action was received in the market? And did that cover both disposal and field services?

喬恩，我只是想從美國生態學開始。好奇那裡的事情進展如何。聽起來你 9 月份的價格飆升，但你能談談市場是如何接受這種行動的嗎？這是否涵蓋了處置和現場服務？

Yes. Integration broadly is going well. I'm really happy with what we purchased in terms of, certainly, the asset quality and also the people and culture and capabilities. And we're able to do a lot of the integration planning work ahead of the close so that we've got a team that's hit the ground running, and I think the results are certainly showing that.

是的。廣泛的整合進展順利。我對我們在資產質量以及人員、文化和能力方面購買的東西感到非常滿意。我們能夠在收盤前做很多整合規劃工作，這樣我們的團隊就已經開始運作，我認為結果肯定表明了這一點。

Yes, we did put in the pricing action. That was on the disposal side of the business, where we start there. We've certainly taken some more tactical pricing actions on the field services side, and we've seen no degradation in volume from that. So the market has been very receptive to that. I think it fulfills our thesis that these assets and services have a lot of value to customers. And if you provide great work, they're willing to certainly pay a fair price. And we'll be continuing with pricing actions into 2023 and beyond to make sure that we're getting positive returns in every stage of the value chain.

是的，我們確實採取了定價行動。那是在業務的處置方面，我們從那裡開始。我們當然在現場服務方面採取了一些更具戰術性的定價行動，而且我們沒有看到數量因此而下降。所以市場對此非常接受。我認為這符合我們的論點，即這些資產和服務對客戶有很大的價值。如果您提供出色的工作，他們當然願意支付合理的價格。我們將在 2023 年及以後繼續採取定價行動，以確保我們在價值鏈的每個階段都獲得正回報。

Okay. Good deal. Yes, that's helpful. And then on the pricing side, obviously, another good print. But I'm curious about a couple of things. Number one, do you think that the 6.9% that you posted this quarter could be the high watermark? As we look to '23, what do you think that 50% of the book that's restricted? What do you think that you'll see on pricing in that piece as we look to '23?

好的。很好的交易。是的，這很有幫助。然後在定價方面，顯然，另一個很好的印刷品。但我對幾件事感到好奇。第一，你認為你本季度發布的 6.9% 可能是高水位線嗎？當我們展望 23 年時，你認為這本書 50% 的限制是什麼？當我們展望 23 年時，你認為你會在這件作品的定價上看到什麼？

Yes. I think the -- we'll get a little momentum here in the second half -- or shipside in the first half of next year, that will be 4.5% or north of 4.5%, we think, just based on the roll-through of where the all the different indices that we have at this point start to hit.

是的。我認為 - 我們將在下半年獲得一點動力 - 或者明年上半年，這將是 4.5% 或 4.5% 以上，我們認為，僅基於滾動我們在這一點上擁有的所有不同指數開始觸及的地方。

Yes. And Tyler, just to put that into context. In the third quarter, the restricted pricing was 4%. And in Q2, that number was 3.5%. So you can see the nice acceleration as we move forward.

是的。和泰勒，只是為了把它放在上下文中。第三季度，限制性定價為 4%。在第二季度，這個數字是 3.5%。因此，當我們前進時，您可以看到良好的加速。

Yes. Perfect. Okay. And then last one, just on the acquisition drag. I think, Brian, did you say 150 basis points? Why was that so big?

是的。完美的。好的。然後是最後一個，就在收購拖累上。我想，布賴恩，你說的是 150 個基點嗎？為什麼那麼大？

Well, you have the combination of US Ecology was $90 million of the $150 million. We also have some of the environmental solutions transactions that we did late Q3 of last year. So most of that, the other $60 million, starts anniversarying in the fourth quarter.

好吧，美國生態學的組合是 1.5 億美元中的 9000 萬美元。我們還有一些去年第三季度末進行的環境解決方案交易。所以其中大部分，另外 6000 萬美元，在第四季度開始週年紀念。

The next question comes from Toni Kaplan of Morgan Stanley.

下一個問題來自摩根士丹利的托尼卡普蘭。

First, I wanted to ask about the strong volume that we've been seeing this year. I wanted to ask about your view on the sustainability of that. I think it's been progressively maybe coming down, but I think overall, fairly good. So I just wanted to ask about that.

首先，我想問一下我們今年看到的強勁銷量。我想問一下你對這種可持續性的看法。我認為它可能會逐漸下降，但我認為總體而言，相當不錯。所以我只是想問一下。

Yes. Volume remains strong, certainly in our more recurring side of the business, but also in the places that are more transactional like special waste and temporary large container. We're still supply-constrained there, and that's still broad-based. Now as we think into next year, right, we're planning on those growth rates modulating a bit just because we're reading the same things you all are around some economic pullback. But frankly, I would have expected to see some of that already. We remain very, very positive in the volume environment right now.

是的。銷量依然強勁，當然是在我們經常出現的業務方面，但在特殊廢物和臨時大型容器等交易量更大的地方也是如此。我們那裡的供應仍然有限，而且仍然是廣泛的。現在我們考慮到明年，對，我們正在計劃對這些增長率進行一些調整，因為我們正在閱讀同樣的事情，你們都在一些經濟回調中。但坦率地說，我已經預料到會看到其中的一些。我們現在在成交量環境中仍然非常非常樂觀。

And all the demand signals that we watch as far as new business, new business and the small container business continues to exceed lost business and service increases are exceeding service decreases. So the demand is definitely there.

就新業務、新業務和小型集裝箱業務而言，我們觀察到的所有需求信號繼續超過丟失的業務，並且服務的增加超過了服務的減少。所以需求肯定是存在的。

Terrific. And on the OCC, I know you mentioned the expectation for, I should say, commodity basket. You mentioned the $90 a ton for 4Q. Is the sensitivity that you give in the filings, the $10 million impact to revenue and profitability for $10 a ton, is that a fair -- like is that going to still hold for this? Or is there a sensitivity on certain levels of where it is? And also, if you could help us think about the main components within the basket.

了不起。在 OCC 上，我知道您提到了對商品籃子的預期。你提到了第四季度每噸 90 美元。你在文件中給出的敏感度，每噸 10 美元對收入和盈利能力的 1000 萬美元影響，是否公平——就像這仍然適用嗎？還是在某些水平上存在敏感性？此外，如果您能幫助我們考慮籃子中的主要組成部分。

Yes. No, that sensitivity will hold, right? So right now, if we were to sit there and look at $90 a ton, if that held true for all of '23 compared to the $165 average that we're projecting for '22, that would be a decrease of about $75 million of both revenue and EBITDA on the commodity line item.

是的。不，這種敏感性會成立，對吧？所以現在，如果我們坐在那裡看每噸 90 美元，如果與我們預測的 22 年平均 165 美元相比，這在 23 年全年都是如此，那將減少約 7500 萬美元商品行項目的收入和 EBITDA。

The next question comes from Noah Kaye of Oppenheimer.

下一個問題來自奧本海默的諾亞凱。

Can I follow up on that one? So $75 million theoretically of revenue flowing right to EBITDA on the commodity line item, can you talk about offsets to that in terms of processing fees or other structures you have? I know you've done a lot of work to delink the commodity exposure. So any clarification you can provide there would be helpful.

我可以跟進那個嗎？因此，理論上有 7500 萬美元的收入直接流向商品項目的 EBITDA，您能否談談在加工費或您擁有的其他結構方面的抵消？我知道你已經做了很多工作來使商品風險脫鉤。因此，您可以在那裡提供的任何澄清都會有所幫助。

Yes. No, that's a net number. So if you remember, if you go back and look at our filings a couple of years ago, the sensitivity to a $10 change was $20 million. So we've cut that in half, and that's by being able to go in and actually share, right, in that volatility with the customer. So that's where you really see that change. When we talk about that $10 equaling about $10 million worth of EBITDA, that is a net number.

是的。不，這是一個淨數字。因此，如果您還記得，如果您回過頭來查看我們幾年前的文件，對 10 美元變化的敏感性是 2000 萬美元。因此，我們將其減少了一半，這是因為能夠進入並實際與客戶分享這種波動性。所以這就是你真正看到這種變化的地方。當我們談論這 10 美元等於價值約 1000 萬美元的 EBITDA 時，這是一個淨數字。

$10 million of EBITDA, but not $10 million of revenue? Just to clarify.

1000 萬美元的 EBITDA，但不是 1000 萬美元的收入？只是為了澄清。

It's both. It's $10 million of revenue and EBITDA. Because again, if you think about what we did, is that when we actually went in and changed the structure of the recycling contract, we basically just put that into the base rate. So that's how we actually wound up offsetting some of that volatility. So that's why when you look at the sensitivity now with the $10 change is $10 million to both revenue and EBITDA because it's just isolating the commodity impact. The service fee that we're charging to actually either process the material or to collect that material is going to stay unchanged regardless of what the commodity price is.

兩者都是。這是 1000 萬美元的收入和 EBITDA。因為再一次，如果你想想我們做了什麼，當我們真正進入並改變回收合同的結構時，我們基本上只是將其納入基本費率。所以這就是我們最終抵消部分波動性的方式。所以這就是為什麼當你看現在 10 美元的變化對收入和 EBITDA 都是 1000 萬美元的敏感性時，因為它只是隔離了商品的影響。無論商品價格如何，我們實際處理材料或收集材料所收取的服務費都將保持不變。

Yes. Very helpful. There's been some discussion of -- you mentioned interest expense looking at next year, but also bonus depreciation stepping down. Can you talk about that? And any other puts and takes you think about for free cash flow conversion as we look to next year?

是的。非常有幫助。有一些討論——你提到了明年的利息支出，還有獎金折舊的下降。你能談談嗎？當我們展望明年時，您是否考慮過任何其他的自由現金流轉換？

Yes. Look, if you -- just from an interest expense perspective, if you take a look at year-over-year, and if this is assuming a 125 basis point hike in the fourth quarter, that would be about a $70 million increase to interest expense year-over-year, which, in isolation, it's about a 100 basis point headwind to free cash flow conversion. That said, though, we had a plan that called for pricing in excess of cost inflation and to drive very strong growth. So even though these are some new headwinds that are presenting into our plan for next year, we still expect very strong growth in revenue, EBITDA and free cash flow.

是的。看，如果你 - 僅從利息支出的角度來看，如果你看一下同比，如果這是假設第四季度加息 125 個基點，那將增加約 7000 萬美元的利息同比支出，單獨來看，這對自由現金流轉換造成了大約 100 個基點的逆風。儘管如此，我們有一個計劃，要求定價超過成本通脹並推動非常強勁的增長。因此，即使這些是我們明年計劃中出現的一些新不利因素，我們仍然預計收入、EBITDA 和自由現金流的增長將非常強勁。

Yes. I mean in reiterating, I just want to make this point right and [please nuance] as it makes sense. But in saying you're comfortable with this year's guidance and point to above average growth for next year, I mean it's really pricing and operating leverage in solid waste that's making up some of these headwinds, if you will. And I just want to get your view on whether or not there's incremental pricing that you can put through looking at '23 to shore up some of those gaps.

是的。我的意思是重申，我只想正確地說明這一點，並且[請注意細微差別]，因為它是有道理的。但在說你對今年的指導感到滿意並指出明年的增長高於平均水平時，我的意思是，如果你願意的話，確實是固體廢物的定價和運營槓桿構成了其中的一些不利因素。我只是想了解您是否可以通過查看 23 年的增量定價來彌補其中的一些差距。

Well, I'd also say it's also growth and margin expansion in environmental solutions. Nothing offset it, right? We've got plans there to continue to cross-sell, continue to price, right, and drive our cost synergy numbers there. So you'll see nice margin expansion in that part of the business as well.

好吧，我還要說這也是環境解決方案的增長和利潤擴張。沒有什麼能抵消它，對吧？我們已經計劃在那裡繼續交叉銷售，繼續定價，對，並在那裡推動我們的成本協同效應。所以你會看到這部分業務的利潤率也有很好的增長。

We're committed to price ahead of cost inflation under almost any scenario, obviously, right, in a black sponsor area, where we get into crazy levels of interest rates, right, we'll come back and talk then. But we've been in a pretty high interest rate environment and lower interest rate environment, and we've done a pretty good job of, in both scenarios or both cases, pricing ahead of cost inflation.

在幾乎任何情況下，我們都致力於在成本通脹之前定價，顯然，對，在一個黑人讚助商區域，我們進入瘋狂的利率水平，對，我們會回來談談。但是我們一直處於一個相當高的利率環境和一個較低的利率環境中，我們在兩種情況下或兩種情況下都做得很好，在成本通脹之前定價。

And we're doing that playing a long game, right? We have customers. This is a loyalty business. So we're always going to do things that maximize the lifetime value of the business and, therefore, drive intrinsic value versus doing anything unnatural in a quarter that might drive short-term results but aren't really good for the shareholders longer term.

我們這樣做是為了打一場持久戰，對吧？我們有客戶。這是一項忠誠度業務。因此，我們總是會做能夠最大限度地提高業務生命週期價值的事情，從而推動內在價值，而不是在一個季度內做任何不自然的事情，這些事情可能會推動短期業績，但對股東的長期利益並不真正有利。

The next question comes from Kevin Chiang of CIBC.

下一個問題來自 CIBC 的 Kevin Chiang。

Maybe just on the comments you made on the small container yield improvement. It continues to be outsized. Well, I mean you're going to get good pricing everywhere, but especially seems continue to be outsized. Just -- can you just explain to me why that is, why are you seeing even stronger pricing of small container relative to your other (inaudible) business?

也許只是您對小型容器產量改進的評論。它繼續超大。好吧，我的意思是你會在任何地方都能得到很好的定價，但尤其是似乎繼續超大。只是 - 您能否向我解釋一下為什麼會這樣，為什麼您看到相對於您的其他（聽不清）業務而言，小型集裝箱的定價更高？

Yes, I think it's a combination of things, Kevin. I think it's certainly customer mix. We want to be with customers who are willing to pay more. We've got pretty sophisticated tools in our sales and marketing teams to identify those customers and present them with an offering where they're willing to pay more.

是的，我認為這是多種因素的結合，凱文。我認為這當然是客戶組合。我們希望與願意支付更多費用的客戶在一起。我們的銷售和營銷團隊擁有非常複雜的工具來識別這些客戶並向他們提供他們願意支付更多費用的產品。

More transactional parts of the business, for example, brokers, we just pushed that out of our portfolio because they're renters. For renting, those customers, they're not going to be with us for a long time. And so the mix certainly helps us. And then the offering we put in front of customers in terms of digital tools, the sophistication of our pricing that allows us to give very targeted pricing to a customer and understanding willingness to pay. All of those things drive yield, which is the ultimate pricing metric. Core price is a means to an end. The ultimate metric which ties to the P&L and margin expansion is yield.

業務的更多交易部分，例如經紀人，我們只是將其排除在我們的投資組合之外，因為他們是租房者。對於租房，那些客戶，他們不會和我們在一起很長時間。所以這種混合肯定對我們有幫助。然後是我們在數字工具方面提供給客戶的產品，我們定價的複雜性使我們能夠為客戶提供非常有針對性的定價並了解支付意願。所有這些都推動了收益率，這是最終的定價指標。核心價格是達到目的的手段。與損益和利潤率擴張相關的最終指標是收益率。

Okay. No, no, that's very helpful. And then just my second one, the 160 basis point sequential improvement in EBITDA margin in environmental solutions. You talked about some of the early wins in terms of pricing and cross-selling and cost-cutting. Just as you think about that 160, like is there a bucket that primarily drove that? Would it be primarily the cost-cutting and then you can build off of this if some of the other synergies roll through? Or was it kind of a mix of things that drove that 160?

好的。不不不，這很有幫助。然後是我的第二個，環境解決方案的 EBITDA 利潤率連續提高了 160 個基點。您談到了在定價、交叉銷售和成本削減方面的一些早期勝利。就像您考慮 160 一樣，是否有一個主要驅動它的水桶？主要是削減成本，如果其他一些協同效應發揮作用，你可以以此為基礎嗎？或者是驅動 160 的混合因素？

No, it's a mix of things. All have contributed and that -- really, that balanced approach is what we look for going forward as we look to take a business, again, that was in the mid- to high teens. And over a longer period of time, we think there's no reason that business can't be in the mid- to high 20s, right? That's where over a period of years, we think we can take the business.

不，這是混合的東西。所有人都做出了貢獻，而且 - 實際上，這種平衡的方法是我們在尋求開展業務時所期待的，同樣，那是在中高年級。而且在更長的時間內，我們認為沒有理由不能在 20 多歲的中高點做生意，對吧？這就是多年來，我們認為我們可以開展業務的地方。

Yes, remember, too, there's obviously seasonality in that business, just like there is in the recycling and solid waste business. And so Q3 seasonally tends to be that highest quarter. So I think as we get more quarters as well, you'll start to see the growth year-over-year. But I think you're definitely going to see -- as Jon mentioned, you're going to see a combination of pricing actions. You're going to see some of the cost takeout that we've done as we realize some of the synergies and benefit from some of the cross-selling.

是的，請記住，該業務顯然存在季節性，就像回收和固體廢物業務一樣。所以第三季度往往是最高的季度。因此，我認為隨著我們獲得更多季度，您將開始看到同比增長。但我認為你肯定會看到——正如喬恩所說，你會看到定價行為的組合。當我們意識到一些協同效應並從一些交叉銷售中受益時，您將看到我們所做的一些成本扣除。

Congrats with some good results here.

恭喜這裡取得了一些好成績。

The next question comes from Michael Hoffman of Stifel.

下一個問題來自 Stifel 的 Michael Hoffman。

So I went back here as fast as I could do this while we're on the call. I think for 10 years, you all have given some kind of indication of what the next year is going to be in the third quarter. So this is like the first time you're not in 10 years and yet -- then you say sales EBITDA and free cash flow will be up. So can you help us a little bit of how to understand what's the messaging? What's up mean, up a little, up a lot, up like -- how do we make sure we get the right place to land on '23?

所以我在通話期間盡可能快地回到這裡。我認為 10 年來，你們都已經對明年第三季度的情況給出了某種暗示。所以這就像你第一次不是在 10 年內 - 然後你說銷售 EBITDA 和自由現金流將會增加。那麼你能幫助我們一點點如何理解消息是什麼嗎？上升是什麼意思，上升一點，上升很多，就像 - 我們如何確保我們在 23 年獲得正確的著陸點？

Yes. We had talked about last quarter, we thought we'd potentially have line of sight to double-digit revenue growth, right? We're probably off that a little bit in terms of what our expectations are for a couple of reasons. One is commodity price, those coming down. They obviously have a revenue impact and a margin impact. The second is some of the acquisitions that we had hoped to close in the fourth quarter get pushed out. So we feel very confident that those are going to be deals that close, but they're going to roll into the first quarter; in one case, the second quarter, which just pushes the rollover effect of that revenue benefit.

是的。我們在上個季度討論過，我們認為我們可能會看到兩位數的收入增長，對吧？出於幾個原因，我們可能對我們的期望有所偏離。一是商品價格，那些正在下降。它們顯然會對收入和利潤產生影響。第二個是我們希望在第四季度完成的一些收購被推遲了。因此，我們非常有信心這些交易將完成，但它們將持續到第一季度；在一種情況下，第二季度只是推動了該收入收益的展期效應。

And then the market, I think, is getting a little more uncertain, as you see, from a broader macro standpoint. All that being said, Michael, we feel really good about high single-digit revenue growth, right, kind of in line with that EBITDA growth and free cash flow growth. So -- and those, if you think about getting back to a 10-year period, right, those are certainly above average numbers for the performance in a very challenging environment. So we're very optimistic about the rate.

然後，我認為，從更廣泛的宏觀角度來看，市場變得更加不確定。話雖如此，邁克爾，我們對高個位數的收入增長感到非常滿意，對，這與 EBITDA 增長和自由現金流增長一致。所以 - 如果你考慮回到 10 年的時期，對，這些肯定高於在非常具有挑戰性的環境中的表現的平均數字。所以我們對利率非常樂觀。

It's the reason why we're not giving some more formal type of indication. If you go back 5 years, it's a pretty predictable recurring revenue business or you got a lot of visibility. We're living in very dynamic and different times in terms of what's happening with interest rates and labor tightness and inflation and all those things. So I think that just -- and commodity prices. Given all those uncertainties, we thought we're going to be in a better position 3 months from now to provide more clarity.

這就是為什麼我們沒有給出一些更正式的指示的原因。如果你回到 5 年前，這是一個非常可預測的經常性收入業務，或者你有很多知名度。就利率、勞動力緊張和通貨膨脹以及所有這些事情而言，我們生活在一個非常動態和不同的時代。所以我認為這只是 - 和商品價格。鑑於所有這些不確定性，我們認為我們將在 3 個月後處於更好的位置，以提供更多的清晰度。

Fair enough. But at least we've got some guardrails we can live in based on what you just shared. And then you did give us a sense of restricted price first half, 4.5%, but the rate of inflation can be accelerating in the second half. So the assumption would be that restricted price in the second half would be greater than the 4.5% at the current trend hold. Is that the right observation?

很公平。但至少我們有一些護欄，我們可以根據你剛剛分享的內容來生活。然後你確實給我們一種上半年限價的感覺，4.5%，但下半年通脹率可能會加快。因此，假設下半年的限制價格將高於當前趨勢保持的 4.5%。這是正確的觀察嗎？

Yes. I don't know that's going to be significantly different, Michael, throughout the year. I would kind of put again in that 4.5% to 5% range, right, for the full year. Again, we're exiting Q3 at 4%. So you'll see some acceleration, but I think it will be moderate acceleration throughout the year.

是的。邁克爾，我不知道全年會有顯著不同。我會在全年的 4.5% 到 5% 範圍內再次投入。同樣，我們以 4% 的價格退出第三季度。所以你會看到一些加速，但我認為這將是全年的適度加速。

And one last thing on price. Is your starting open market price your exit rate from 4Q?

最後一件事是價格。您的起始公開市場價格是您從 4Q 的退出率嗎？

Yes, for the most part. I mean look, if you look at where we're saying right now with a 5.6% average yield on total revenue, call it around 6% on related revenue in total, if you think about the open market portion of that, we would see that participating next year or contributing relatively in line with what we got this year.

是的，在大多數情況下。我的意思是看，如果你看看我們現在所說的總收入平均收益率為 5.6%，總收入約為 6%，如果你考慮其中的公開市場部分，我們會看到明年參與或貢獻與我們今年得到的相對一致。

Okay. That's very helpful. And then one just tweak because you're getting asked better volume. I mean you're getting -- you're still seeing your good correlation in household formation, new business formation. You alluded to positive (inaudible) interval changes, new business exceeding loss business, but the rate of change will start to narrow because we were off of a pretty healthy recovery in the second half of '21 into first half of '22. So we're going to start normalizing into a more narrow rate of change, but the trend underlying is still positive.

好的。這很有幫助。然後一個只是調整，因為你被要求更好的音量。我的意思是你得到 - 你仍然看到你在家庭形成，新業務形成方面的良好相關性。您提到了積極的（聽不見的）區間變化，新業務超過了虧損業務，但變化率將開始收窄，因為我們在 21 年下半年到 22 年上半年的複蘇非常健康。因此，我們將開始正常化為更窄的變化率，但潛在趨勢仍然是積極的。

Absolutely, Michael. That's our expectation when we think about '23%. That serves as a modulator. Yes. And we think you start seeing that in the fourth quarter, Michael, and then, again, getting to a more normalized level of growth.

絕對的，邁克爾。當我們考慮“23%”時，這就是我們的預期。用作調製器。是的。我們認為你在第四季度開始看到這一點，邁克爾，然後再次達到更正常的增長水平。

The next question comes from Walter Spracklin of RBC Capital Markets.

下一個問題來自加拿大皇家銀行資本市場的 Walter Spracklin。

Yes. Let me start on the cross-selling opportunities. I think, Jon, you mentioned earlier $75 million to $100 million eventually. You're at the $25 million mark now. Are you still on track from a timing perspective in achieving that full run rate of cross-selling? Or if it's changed, can you comment on that? Has it been pulled forward or pushed back at all and why?

是的。讓我從交叉銷售機會開始。我想，喬恩，你之前提到的最終是 7500 萬到 1 億美元。你現在的身價是 2500 萬美元。從時間的角度來看，您是否仍在實現交叉銷售的全面運行率？或者如果它改變了，你能評論一下嗎？它是被向前拉還是被向後推，為什麼？

Yes. We said we'd achieve that by 2024. That's the time frame that we said, could be at '25 already given that we're still working through some integration rolling this thing out. We have not touched many of our customers yet. We're really, really pleased about our progress and, I would say, quite optimistic about hitting both the level and the timing of that.

是的。我們說我們將在 2024 年實現這一目標。這就是我們所說的時間框架，可能已經是 25 年了，因為我們仍在通過一些整合來推出這個東西。我們還沒有接觸到很多客戶。我們對我們的進步感到非常非常高興，而且我想說，對於達到這一水平和時機都非常樂觀。

Perfect. Perfect. On the OCC prices, your peer yesterday or earlier mentioned that your contracts or their contracts are structured so that the further OCC goes down, the negative impact, that sensitivity that you highlighted kind of contracts, the lower OCC goes. I just want to make sure, are your contracts designed similarly that, that plays out in your contracts as well so that it's not as strict? You mentioned $10. But does that $10 contract when OCC prices go down -- the further that OCC prices go down?

完美的。完美的。關於 OCC 價格，您的同行昨天或更早提到您的合約或其合約的結構使得 OCC 進一步下跌，負面影響，您強調合約種類的敏感性，OCC 越低。我只是想確定一下，你們的合同設計是否與你們的合同類似，並且在你們的合同中也有這樣的規定，所以它不那麼嚴格？你提到了10美元。但是，當 OCC 價格下跌時，那 10 美元的合約是否會 - OCC 價格進一步下跌？

Yes. And that's what -- in the guidance itself and that we put out there, I would sit there and say, on the way up and the way down, that $10 equating to $10 million of revenue and both EBITDA is a good sensitivity to use from a modeling perspective. So again, the type of work that you're doing can dictate that, whether or not you're brokering or that sort of thing. Those sort of things can be different company to company, but that's our sensitivity.

是的。這就是——在指南本身和我們發布的指南中，我會坐在那裡說，在上升和下降的過程中，10 美元相當於 1000 萬美元的收入，而且 EBITDA 都是一個很好的敏感度，可以從建模視角。再說一次，你正在做的工作類型可以決定這一點，無論你是否在做經紀人或類似的事情。這些事情可能因公司而異，但這是我們的敏感性。

Okay. And last question here is you mentioned bp's purchase of Archaea there that you're optimistic working with them and all that. Anything that you can add? Have you spoken to the folks at bp at all? What kind of new ways would you look at partnering with them? Or is it just what you had before is pretty much what you have now and expect to have going forward? Or is there something additional now that you have a new owner or they have a new owner?

好的。最後一個問題是您提到 bp 在那裡購買了 Archaea，您對與他們合作以及所有這些持樂觀態度。有什麼可以補充的嗎？你和 bp 的人談過嗎？您會以什麼樣的新方式與他們合作？或者它只是你以前所擁有的幾乎就是你現在所擁有並期望繼續前進的東西？或者現在你有一個新的所有者或者他們有一個新的所有者，還有什麼額外的東西嗎？

Yes. Yes, we've spoken about that in many levels, including talking to their CEO. They have (inaudible). They've got big, bold, ambitious plans around sustainability and decarbonization, and we think there's a number of ways we can work together. Certainly, in the core JV itself, and they're fully committed to that, and we're getting the best of both worlds because the colleagues from Archaea that they are going to acquire are going to stay. So we feel really excited about that team. But bringing more resources to bear, that will certainly help us hit our marks and maybe move a little faster on that front.

是的。是的，我們在很多層面都談到了這一點，包括與他們的首席執行官交談。他們有（聽不清）。他們圍繞可持續性和脫碳制定了宏偉、大膽、雄心勃勃的計劃，我們認為我們可以通過多種方式合作。當然，在核心合資企業本身，他們完全致力於這一點，我們正在兩全其美，因為他們將收購的來自 Archaea 的同事將留下來。所以我們對這支球隊感到非常興奮。但是帶來更多的資源，這肯定會幫助我們達到目標，並可能在這方面走得更快一些。

And then they have a big business. So they've got a big environmental services business. So there's ways to partner together there. They have a major network of gas stations, and gas station is actually a major place that plastic leak out of the value chain and don't get recycled. So there's ways to pilot and innovate there. And we've done nothing formal together on those fronts yet, obviously, but have like-minded ambitions in terms of making the world more environmentally sustainable and doing that in a way that drives growth for our shareholders as well.

然後他們有一個大生意。所以他們有一個很大的環境服務業務。所以有很多方法可以在那里合作。他們有一個主要的加油站網絡，加油站實際上是塑料從價值鏈中洩漏出來並且沒有得到回收的主要場所。所以有辦法在那裡進行試點和創新。顯然，我們在這些方面還沒有做任何正式的合作，但在使世界更加環境可持續發展並以推動股東增長的方式方面，我們有著志同道合的雄心。

Yes. So it's an opportunity to get creative and advance that initiative. That's great. Okay. I appreciate the time.

是的。因此，這是一個發揮創造力並推進該倡議的機會。那太棒了。好的。我很珍惜時間。

The next question comes from Jerry Revich of Goldman Sachs.

下一個問題來自高盛的 Jerry Revich。

I'm wondering if you can talk about, for the recycling line of business at the commodity price that you mentioned for the fourth quarter, do you anticipate the business being in a net profit position? Can you just comment on that? And then nice to hear about the reiteration of guidance despite that headwind of $20 million, $30 million from recycling. Can you just talk about what part of the guidance has evolved ahead of expectations? It sounds like it might be yield, but I would love it if you could flesh that out.

我想知道您是否可以談談，對於您提到的第四季度商品價格的回收業務，您是否預計該業務處於淨利潤狀態？你能對此發表評論嗎？然後很高興聽到指導方針的重申，儘管有 2000 萬美元的逆風，3000 萬美元來自回收利用。您能否談談指南的哪一部分發展超出預期？聽起來它可能是產量，但如果你能充實它，我會很高興的。

Yes. So just your first question there at the $90 commodity price, yes, that portion of the business would remain profitable at that level. And then the second part, when you talk about the evolving guide, you're talking about with respect to '22?

是的。因此，在 90 美元的商品價格下，您的第一個問題是，是的，這部分業務將在該水平上保持盈利。然後第二部分，當您談論進化指南時，您是在談論 22 年？

Correct.

正確的。

Yes. So you're talking about just the puts and takes?

是的。所以你說的只是看跌期權？

That's right. Yes. So it sounds like you're able to overcome the recycling headwinds. It feels like yield has accelerated ahead of expectations, but I'm wondering if I could just get you to expand on that.

這是正確的。是的。所以聽起來你能夠克服回收的逆風。感覺收益率已經超出預期，但我想知道我是否可以讓您對此進行擴展。

Yes, better overall yield, better volume performance as we were able to overcome the commodity headwind as well as the higher interest rates in the third quarter. As we now look in the fourth quarter, though, the big drop really happened recently, so September into October. So again, that's why we've maintained the guide because the outperformance from Q3 is basically funding what we expect now for Q4, and we feel pretty good about the full year guide.

是的，更好的整體收益率，更好的銷量表現，因為我們能夠克服商品逆風以及第三季度更高的利率。然而，正如我們現在看到的第四季度，大幅下降確實發生在最近，所以從 9 月到 10 月。再說一次，這就是我們維持該指南的原因，因為第三季度的出色表現基本上為我們現在對第四季度的預期提供了資金，我們對全年指南感覺很好。

And then conceptually, as you think about pricing for the long term into '23, obviously, you don't want to drive churn, but it sounds like based on your prior comments, that we're going to think about pushing pricing in municipal solid waste to essentially fund the recycling headwind is what I think I'm hearing from you. But can I trouble you to put a finer point on that, please?

然後從概念上講，當您考慮到 23 年的長期定價時，顯然，您不想推動客戶流失，但聽起來根據您之前的評論，我們將考慮推動市政定價我想我從你那裡聽到的基本上是為回收逆風提供資金的固體廢物。但是，我能麻煩你更詳細地說明一下嗎？

Yes, we think we're always going to try to price ahead of our cost inflation, Jerry. And obviously, (inaudible) our headwind on that front. But we don't think about it is -- because now there is a short-term headwind that we're going to go out and go put a bunch of price in the market that we could be destructive from a long-term value creation with our customers on that front. So we feel good, like I said, into '23, that even with these headwinds, that we're going to have high single-digit growth on revenue, EBITDA and free cash flow. Just given that we're overcoming that commodity headwind, I think, speaks to the strength of the business.

是的，我們認為我們總是會嘗試在成本膨脹之前進行定價，傑瑞。顯然，（聽不清）我們在這方面的逆風。但我們不認為它是——因為現在有一個短期的逆風，我們要走出去，在市場上放一堆價格，我們可能會破壞長期的價值創造在這方面與我們的客戶合作。所以我們感覺很好，就像我說的那樣，進入 23 年，即使有這些不利因素，我們的收入、EBITDA 和自由現金流也將實現個位數的高增長。鑑於我們正在克服商品逆風，我認為，這說明了業務的實力。

Yes. I mean we talked about the fact that we've seen elevated cost inflation in the business. We see that rolling into '23. And right now, we are making our plans if that cost inflation stays in the business for the full year. So that's where the pricing ahead of cost inflation, that's where that comment is. Now look, if inflation is lower than we think or it starts to abate, then that could be some upside to our current plan, but that's not how we're going into it.

是的。我的意思是我們談到了這樣一個事實，即我們已經看到業務中的成本通脹上升。我們看到這種情況一直延續到 23 年。現在，我們正在製定我們的計劃，如果這種成本通脹在整個業務中持續存在的話。所以這就是成本通脹之前的定價，這就是評論所在。現在看，如果通脹低於我們的預期或開始減弱，那麼這可能對我們目前的計劃有一些好處，但這不是我們的打算。

So we do -- versus our original expectations, we do expect the impact of both lower recycled commodity prices and higher interest rates have an impact on where we thought we were headed as of 9 days ago. But as we just kind of talked about with Michael, we still think the outcome is going to be very strong, especially in the context when you look at an average growth rate and revenue, EBITDA, free cash flow, free cash flow conversion, we think they're all very strong metrics, all growing.

所以我們這樣做了——與我們最初的預期相比，我們確實預計較低的回收商品價格和較高的利率會影響我們在 9 天前認為的發展方向。但是正如我們剛剛與邁克爾談到的那樣，我們仍然認為結果會非常強勁，特別是在您查看平均增長率和收入、EBITDA、自由現金流、自由現金流轉換的背景下，我們認為它們都是非常強大的指標，而且都在增長。

Super. And lastly, I'm wondering, can you just talk about the evolution for offtake agreements in landfill gas in addition to capital deployed by bp? Kinder Morgan has obviously bought some assets as well. Can you just provide an update on offtake agreement visibility? It sounded like the market was moving into the 20s per MMBtu on a multiyear basis. I'm not sure if you feel comfortable commenting on that and how the shape of the market has evolved since the last public update a quarter ago.

極好的。最後，我想知道，除了 bp 部署的資本外，您能否談談垃圾填埋氣承購協議的演變？金德摩根顯然也購買了一些資產。您能否提供有關承購協議可見性的更新？聽起來市場正在進入每 MMBtu 多年的 20 年代。我不確定您是否願意對此發表評論，以及自上個季度前的最後一次公開更新以來市場形態是如何演變的。

No, we're still on track and still the same view, that we are going to fix a portion of this and play spot on the market with the rest of it, which has been probably we think that, that balance between maximizing returns as well as predictability over the cycle and managing risk on that. Certainly have alignment with bp on that same philosophy on the back end of these facilities.

不，我們仍然在軌道上並且仍然有相同的觀點，我們將修復其中的一部分並與其餘部分一起在市場上佔據一席之地，這可能是我們認為的，最大化回報之間的平衡以及週期的可預測性和風險管理。在這些設施的後端，當然與 bp 在同樣的理念上保持一致。

The next question comes from Sean Eastman of KeyBanc Capital Markets.

下一個問題來自 KeyBanc Capital Markets 的 Sean Eastman。

I wanted to come back to the comment about the -- a couple of those acquisitions that slid to the right a little bit. I'm curious, could you help us with the annualized revenue associated with those? I think we've got 300 basis points kind of locked for rollover with ECOL, but just trying to flesh out what that number could ultimately look like.

我想回到關於 - 一些向右滑動的收購的評論。我很好奇，你能幫我們計算與這些相關的年化收入嗎？我認為我們已經鎖定了 300 個基點，以便與 ECOL 進行展期，但只是試圖充實這個數字最終會是什麼樣子。

Yes. From a rollover perspective right now, that's what we're planning is that the 300 basis points of rollover, as Jon mentioned, there were a couple of deals that -- or in the offer they still are where we thought they might close in Q4, they're now looking like they could be early to mid-'23. So we'll keep you updated on that progress. But right now, we're building the plan with 300 basis points of acquisition rollover.

是的。從現在的展期角度來看，這就是我們計劃的 300 個基點展期，正如喬恩所提到的，有幾筆交易 - 或者在報價中，它們仍然是我們認為可能在第四季度完成的交易，他們現在看起來可能早到 23 年中期。因此，我們會及時向您通報該進展。但現在，我們正在製定具有 300 個基點的收購展期計劃。

Okay. Got it. So you don't want to give any hints on the magnitude of those acquisitions that are in the hopper?

好的。知道了。所以你不想就漏斗中的收購規模給出任何暗示嗎？

We'll tell you when they're closed.

我們會在他們關閉時告訴您。

Got it. Okay. Fair enough. Fair enough. And then I just wanted to make sure I understand the ECOL contribution within that bridge to 2023. Obviously, we get a full year of revenue. But I'm just curious how you guys are thinking roughly about the growth rate in ECOL's top line and I think we've got a lot of different pieces to work with here. But just in terms of where we're going to end up on ECOL margins this year, what you guys think that will be for the full year next year.

知道了。好的。很公平。很公平。然後我只是想確保我了解 ECOL 在通往 2023 年的橋樑中的貢獻。顯然，我們獲得了一整年的收入。但我只是好奇你們如何粗略地考慮 ECOL 收入的增長率，我認為我們在這裡有很多不同的部分可以使用。但就今年我們最終將在 ECOL 利潤率上達到的位置而言，你們認為明年全年的情況。

Yes. So of that 300 basis points of rollover, call it, $250 million of it is related to US Ecology. If you just think about in the context of a consolidated company margin, we look at that additional 4 months of rollover having about a 30 basis point headwind on total company margin in '23.

是的。因此，在這 300 個基點的展期中，有 2.5 億美元與美國生態有關。如果您僅考慮合併公司利潤率的背景，我們會看到額外 4 個月的展期對 23 年的公司總利潤率造成約 30 個基點的逆風。

Okay. Got it. And does that assume status quo margins for ECOL year-on-year?

好的。知道了。這是否假設 ECOL 的利潤率同比保持現狀？

Slight step-up as we realized a portion of the synergies again. But for the most part, that's going to be in the ZIP code.

當我們再次意識到部分協同效應時，略有提升。但在大多數情況下，這將在郵政編碼中。

The next question comes from Kyle White of Deutsche Bank.

下一個問題來自德意志銀行的凱爾懷特。

I wanted to go back to pricing. Just curious, are you starting to see any kind of pushback from customers? It seems like everyone 6 months ago was willing to pay higher prices, and now the environment has changed. Is it somewhat -- so curious how those dialogues have gone and if you've seen any kind of pushback that you had mentioned.

我想回到定價。只是好奇，您是否開始看到客戶的任何反對意見？ 6 個月前似乎每個人都願意支付更高的價格，現在環境發生了變化。是不是有點-很好奇這些對話是如何進行的，以及您是否看到過您提到的任何形式的回擊。

No, we're still -- like we said, we put out the highest in our open portion of the business, put out the highest gross price we ever have and have the highest realization rate as the percentage that we ever had, which is an astounding number on that back. So pricing is certainly sticking at elevated levels.

不，我們仍然 - 就像我們說的那樣，我們在業務的開放部分中推出了最高的價格，推出了有史以來最高的總價，並且擁有最高的實現率作為我們曾經擁有的百分比，即背面有一個驚人的數字。因此，定價肯定會保持在較高水平。

The only place we've got challenge is in small micro markets where we've had some challenges with turnover, given labor constraints. Obviously, when you're not providing the service that you want in a given market, right, you're going to cause the customers to reconsider and go elsewhere. And so that's why we're, into 2023, still planning on relatively elevated inflation levels because we're running the business forever. We want to make sure that we provide customers world-class service, and that will keep them staying and stay longer.

我們唯一面臨挑戰的地方是小型微型市場，鑑於勞動力限制，我們在營業額方面遇到了一些挑戰。顯然，當你沒有在給定的市場中提供你想要的服務時，對，你會讓客戶重新考慮並轉向其他地方。這就是為什麼我們在 2023 年仍計劃相對較高的通脹水平，因為我們將永遠經營業務。我們希望確保為客戶提供世界一流的服務，這將使他們留下來並停留更長時間。

Got it. That's helpful. And then on the -- you talked about this a little bit. So you think about 2023 in kind of underlying solid waste expansion margins. I think this year, you're probably running about 60 basis points -- 50 to 60 basis points. And so if you're pricing at these elevated levels of inflation that you're seeing today and that carries into 2023, would that equate to, again, 50 to 60 with the potential to go even higher if we're in a more moderate inflationary environment next year?

知道了。這很有幫助。然後 - 你談到了一點。因此，您可以考慮 2023 年的潛在固體廢物擴張利潤率。我認為今年，你可能會運行大約 60 個基點——50 到 60 個基點。因此，如果您以您今天看到的這些高通脹水平定價並持續到 2023 年，這是否等同於 50 到 60，如果我們處於更溫和的狀態，可能會更高明年通脹環境？

Yes. We said across the cycle, 30 to 50 basis points is what we think about doing in recycling solid waste, and we'll do that over time, right, at an elevated level in environmental solutions. Could that creep higher next year if pricing sticks and inflation comes down in the back half? It certainly could. We're not expecting that in terms of building a plan around it, but that would cause that gap to widen and allow for a little more margin expansion in the second half and certainly then going into 2024.

是的。我們說過，在整個週期中，30 到 50 個基點是我們在回收固體廢物方面的想法，隨著時間的推移，我們會在環境解決方案的更高水平上做到這一點。如果價格保持不變且通脹在後半段下降，明年是否會攀升？它當然可以。我們並不期望圍繞它制定計劃，但這會導致差距擴大，並允許在下半年進一步擴大利潤率，然後肯定會持續到 2024 年。

The next question comes from David Manthey of Baird.

下一個問題來自 Baird 的 David Manthey。

You previously outlined that your revenues have about a 90% correlation with housing starts on a 1-year lag. Is it correct to say that you believe that this is very strong pricing and maybe some environmental solutions can change that historical correlation? And just either way, as starts have clearly been declining and mortgage rates continue to surge, are there any incremental actions that you're eyeing relative to the back half of next year?

您之前概述了您的收入與滯後 1 年的房屋開工有大約 90% 的相關性。說您認為這是非常強大的定價，也許一些環境解決方案可以改變這種歷史相關性，這是否正確？無論哪種方式，隨著開工率明顯下降且抵押貸款利率繼續飆升，相對於明年下半年，您是否正在關注任何增量行動？

Eyeing as far as -- because again, look, that's been a historical correlation. But again, I think that's been in a -- call it, a relatively stable macro environment. And we're -- we've been in anything but kind of have these puts and takes with inflation. So again, at this point, as Jon mentioned, we're going to continue to price in excess of cost inflation.

盡可能 - 因為再一次，看，這是一個歷史相關性。但同樣，我認為這是在一個相對穩定的宏觀環境中。而且我們 - 我們一直在做任何事情，但在通貨膨脹方面有這些看跌期權。因此，正如喬恩所說，在這一點上，我們將繼續定價超過成本通脹。

From an overall demand perspective, again, we've actually seen the demand very strong throughout '22. We're not really seeing any signs of that abating. So again, that's how we're building our plan. Growth levels probably won't be as strong as they were -- or certainly won't be as strong as they were in '22 just because we were still recovering units from the pandemic, but we still expect underlying unit growth in '23 year-over-year.

從整體需求的角度來看，我們實際上已經看到整個 22 年的需求非常強勁。我們並沒有真正看到任何減弱的跡象。再說一次，這就是我們制定計劃的方式。增長水平可能不會像以前那樣強勁——或者肯定不會像 22 年那樣強勁，因為我們仍在從大流行中恢復單位，但我們仍然預計 23 年的潛在單位增長- 超過一年。

Got it. So maybe directionally, you still think there's some correlation there but not necessarily of the magnitude depending on starts is what I'm hearing. Could we talk about the interest rate? You said 1% change in rate is $36 million in interest expense. What was the reference rate in the third quarter from which to build to the fourth quarter in 2023 then?

知道了。所以也許在方向上，你仍然認為那裡有一些相關性，但不一定是取決於開始的幅度是我所聽到的。我們可以談談利率嗎？您說 1% 的利率變化是 3600 萬美元的利息支出。那麼從第三季度到 2023 年第四季度的參考利率是多少？

Yes. So again, right now, what we're expecting is another 125 basis point increase, right, in the fourth quarter, that's how we built our plan, and then that being relatively stable throughout 2023. If you think about what that means relative to where we were exiting Q3, that's a good 125 basis points for the -- when we think about where we are in Q4, good 125 basis points from where we were exiting Q2. So the impact of that as we think about year-over-year is a $70 million increase in total interest expense, which is about a $50 million increase to cash flow once you net out the related taxes.

是的。再說一次，現在，我們預計第四季度會再增加 125 個基點，這就是我們制定計劃的方式，然後在整個 2023 年保持相對穩定。如果你想想這意味著什麼在我們退出第三季度的地方，這對於我們來說是一個很好的 125 個基點——當我們考慮到我們在第四季度的位置時，比我們退出第二季度的位置好 125 個基點。因此，當我們考慮同比時，其影響是總利息支出增加了 7000 萬美元，一旦扣除相關稅款，現金流量將增加約 5000 萬美元。

The next question comes from Stephanie Moore of Jefferies.

下一個問題來自 Jefferies 的 Stephanie Moore。

I wanted to touch on your tech investments and digital tools. I appreciate the update on the RISE platform. It would be helpful if you could share, I don't know, any KPIs or benefits that you're seeing from the early rollout of those tools on the efficiency side. And as we think to 2023, kind of what's in the pipeline from the digital tools and some investments that might be in the works.

我想談談你的技術投資和數字工具。我感謝 RISE 平台上的更新。如果您能分享（我不知道）您從早期推出這些工具的效率方面看到的任何 KPI 或好處，那將會很有幫助。正如我們認為到 2023 年，數字工具和一些可能正在進行的投資正在醞釀之中。

Yes, we've certainly seen over the last 18 months productivity benefit, which allows us to get more work done in the same amount of time with great customer service and doing it safely. They're primary value for our drivers. So we -- from a cost standpoint, we think we've taken out almost $50 million at this point. And we think over the next 18 months, we've got another $50 million that we can take out of the business as we get full deployment and full utilization of this.

是的，在過去的 18 個月中，我們確實看到了生產力優勢，這使我們能夠在相同的時間內完成更多的工作，同時提供出色的客戶服務並安全地完成工作。它們是我們司機的主要價值。所以我們 - 從成本的角度來看，我們認為我們目前已經花費了近 5000 萬美元。我們認為，在接下來的 18 個月內，隨著我們全面部署和充分利用這一點，我們可以再從業務中取出 5000 萬美元。

And then when you connect it back to the customer, all that information allows us to communicate with a customer, right, with this Track My Truck we talked about. That allows the customer to see where we are and when the pickup is going to occur. And it not only allows, in some cases, them to look for themselves, right, where the vehicle is and when the pickup is coming, but even if they decide to use a different channel and call our customer service center, then we're able to have our agent look up there and give the customer -- it will be there tomorrow or a range, but give them a far more precise time that the truck is on the way and give the customer assurance.

然後，當您將其連接回客戶時，所有這些信息都使我們能夠與客戶溝通，對，就是我們談到的 Track My Truck。這使客戶可以看到我們在哪里以及何時進行取貨。在某些情況下，它不僅允許他們自己尋找車輛所在的位置和取貨時間，而且即使他們決定使用不同的渠道並致電我們的客戶服務中心，我們也會能夠讓我們的代理在那裡查找並提供給客戶——它明天或某個範圍內會在那裡，但給他們一個更準確的時間，告訴他們卡車正在路上，並給客戶保證。

So a lot of what we get is that, right? We run so precise that we're there within a 0.5-hour, 45-minute window every week or multiple times a week for a customer. And so when we miss that window, even if we're going to be there that day, the customers call and they're concerned. So this allows us to provide better information, take cost out of the system, and we're not going to talk about those today, but you're going to see more innovation come off that, that make the customer offering differentiated that we think can directly hit the P&L in terms of customers staying longer.

所以我們得到的很多東西就是這樣，對吧？我們運行如此精確，以至於我們每週在 0.5 小時 45 分鐘的窗口內或每週多次為客戶服務。因此，當我們錯過那個窗口時，即使我們那天要去那裡，客戶也會打電話來表示擔心。因此，這使我們能夠提供更好的信息，降低系統成本，我們今天不打算討論這些，但你會看到更多的創新，使我們認為的客戶產品與眾不同就客戶停留時間而言，可以直接觸及損益。

Great. And then just touching on the M&A side, maybe on the traditional waste. Are you seeing any changes in demand or interest levels in this environment?

偉大的。然後只是觸及併購方面，也許是傳統的浪費。在這種環境下，您是否看到需求或興趣水平有任何變化？

No, I think the pipeline is certainly strong, and there's significant willingness to sell. We're obviously maintaining a lot of discretion, right? Some companies don't fit us from a profile standpoint. From a value standpoint, they might not be a good fit for us. So we remain very discriminating in terms of what we buy. But the pipeline is very, very strong.

不，我認為管道肯定很強大，並且有很大的出售意願。我們顯然保持了很大的自由裁量權，對吧？從個人資料的角度來看，有些公司不適合我們。從價值的角度來看，它們可能不適合我們。因此，我們在購買什麼方面仍然非常挑剔。但是管道非常非常強大。

It's getting harder to do business. If you think about the digital investments we just talked about, that's becoming a second moat, it's not just the postcollection infrastructure. All of those investments we make are very expensive. They take a lot of time. They take a lot of expertise. So that makes it tough, or the current labor environment makes it more challenging.

做生意越來越難。如果您考慮一下我們剛剛談到的數字投資，那將成為第二道護城河，而不僅僅是收集後的基礎設施。我們所做的所有這些投資都非常昂貴。他們需要很多時間。他們需要很多專業知識。所以這讓它變得艱難，或者當前的勞動力環境使它更具挑戰性。

The current supply chain being constrained, right? We're only slightly delayed in deliveries of equipment because we're a great customer for our suppliers, right? We buy trucks year in and year out, where some of the smaller players will go years without buying and try to buy in the spot market. Well, now they're locked out. Those factories are full, and they're at the end of the line. And so you suffer to get labor. And those people you hire have to drive old equipment that's in need of repair and/or replacement, right? That's a big advantage for us to take over those business.

當前的供應鏈受到限制，對嗎？我們只是稍微延遲了設備的交付，因為我們是供應商的好客戶，對吧？我們年復一年地購買卡車，一些較小的參與者將多年不購買並嘗試在現貨市場購買。好吧，現在他們被鎖定了。那些工廠已經滿了，而且他們在生產線的盡頭。所以你為了得到勞動而受苦。您僱用的那些人必須駕駛需要維修和/或更換的舊設備，對嗎？這是我們接管這些業務的一大優勢。

The next question comes from Michael Feniger of Bank of America.

下一個問題來自美國銀行的 Michael Feniger。

Brian, you guys just did, on a year-to-date basis, adjusted free cash flow of $1.67 billion, really strong. I think your guide is $1.7 million or so. You might have touched on it earlier. Is there anything I'm missing on the fourth quarter that we should be aware of, of why you're not releasing the free cash flow outlook?

布萊恩，你們剛剛做了，在年初至今的基礎上，調整後的自由現金流為 16.7 億美元，非常強勁。我認為你的指南是 170 萬美元左右。你可能早先接觸過它。第四季度有什麼我應該注意的遺漏嗎，為什麼你們不發布自由現金流展望？

Yes. So Mike, I had actually mentioned it in the remarks. So the CapEx that we spent year-to-date, so through 3 quarters, and the cash interest represents only about half of our expected full year spend. So in the fourth quarter, we expect a disproportionate amount of both CapEx and cash taxes relative to the average you've seen. So that's why you see a relatively modest Q4 contribution and why we've maintained the guide as it is on free cash flow.

是的。所以邁克，我實際上在評論中提到了它。因此，我們今年迄今花費的資本支出，因此通過 3 個季度，現金利息僅占我們預期全年支出的一半左右。因此，在第四季度，我們預計資本支出和現金稅的數額與您所看到的平均值相比不成比例。所以這就是為什麼你看到第四季度的貢獻相對較小，以及為什麼我們維持自由現金流的指南。

Some of that, as Jon mentioned, accelerating some of the investments in polymer center throughout the year, some of the things we've done in order to fund this outsized growth. But -- so you can reasonably expect a little bit more CapEx than we originally anticipated, partially being offset by a little bit less cash taxes than we originally anticipated.

正如喬恩所說，其中一些，全年加速了對聚合物中心的一些投資，我們為支持這種超常增長所做的一些事情。但是 - 所以你可以合理地預期比我們最初預期的更多的資本支出，部分被比我們最初預期的少一點的現金稅所抵消。

And I guess, Brian, just to follow up with that and to put a finer point. Do you plan to grow your free cash flow next year? Will that growth be in line with the EBITDA growth? Because, obviously, in the context of where you guys are kind of targeting your free cash flow conversion over time.

我想，布賴恩，只是為了跟進這一點並提出更好的觀點。你計劃明年增加你的自由現金流嗎？這種增長是否與 EBITDA 增長一致？因為，顯然，在你們隨著時間的推移將自由現金流轉換作為目標的背景下。

Yes. First question, yes, we definitely expect to grow our free cash flow. And yes, it should be relatively in line with the growth in EBITDA. We would have expected to grow it a little bit more. Obviously, the impact of interest expense and recycled commodity prices impacts that, but we are fully expecting to grow.

是的。第一個問題，是的，我們肯定希望增加我們的自由現金流。是的，它應該與 EBITDA 的增長相對一致。我們本來希望它增長一點點。顯然，利息費用和回收商品價格的影響會影響到這一點，但我們完全預計會增長。

At this time, there appear to be no further questions. Mr. Vander Ark, I'll turn the call back over to you for closing remarks.

此時，似乎沒有進一步的問題。 Vander Ark 先生，我會將電話轉回給您，以便您結束髮言。

Thank you, Andrea. I would like to thank the entire Republic Services team for their efforts and commitment to driving lasting value for all of our stakeholders. Have a good evening, and be safe.

謝謝你，安德里亞。我要感謝整個共和服務團隊為為所有利益相關者創造持久價值所做的努力和承諾。晚上好，注意安全。

Ladies and gentlemen, this concludes the conference call. Thank you for attending, and you may now disconnect.

女士們，先生們，電話會議到此結束。感謝您的參與，您現在可以斷開連接。