Waste Connections Inc. Q3 2008 Earnings Conference Call Transcript

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2008-10-22 08:07:15.0

Tags: Call Transcript, Competitive Market, Earnings, Pricing Strategy, Waste Connections Inc., Pricing, Marketing Research, Marketing, Seeking Alpha, Call Transcript, Competitive Market, Earnings, Pricing Strategy, Waste Connections Inc., Pricing, Marketing Research, Marketing, Seeking Alpha

Question-and-Answer Session

Thank you, Sir. [Operator Instructions]. You first question comes from the line of Scott Levine with Waste Connections [ph]. Please proceed.

Ronald J. Mittelstaedt - Chairman and Chief Executive Officer

Welcome to the company.

Worthing F. Jackman - Executive Vice President and Chief Financial Officer

Welcome to the company.

Scott Levine - JPMorgan

Thanks. Good to be here, JPMorgan. Could your talk a little bit about the trends with regard to pricing in your competitive markets versus your franchise markets and whether any of those trends have been surprising in your view, given the sharp downturn here over the last four to six weeks and also talk to month-on-month trends in the quarter, both price and volumes?

Ronald J. Mittelstaedt - Chairman and Chief Executive Officer

Okay, Scott. First with regard to price, the price in the competitive markets has held up very well, especially the core pricing in the competitive markets. We've really seen no change in that. That has remained in the 5% to 7% plus range on the core pricing. We... now, the core pricing in the exclusive markets continues to stay strong, obviously at a lower level because that is indexed to a CPR of other [ph] measure that's staying in that 3% to 4.5% range.

The difference is that obviously as fuel declines particularly in the competitive markets, the surcharge piece of pricing will come down because it's indexed to one or more different indexes regarding diesel or crude. So that has come down obviously, so has the cost, so it should come down.

And that is the different between both competitive and exclusive. In the exclusive market it has not come down nearly as much because we only get it either perhaps once a year or twice a year. So there is a much greater much lag going on and a much greater lag coming off on the surcharge in the exclusive. So there has really been no change to the pricing environment, whether you look at it as exclusive or competitive in our model.

On the volume side; I think your question was how that compared, we've obviously given macro volume for roll-off and for length of volumes in the quarter. How that compared in the quarter? The basic trend was it was down in July. It actually improved a little bit in August. And then came down much more precipitously in September, particularly the last two weeks of September. And October, at this point has stayed inline with the last two weeks of September.

 

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