Q4 2025 GFL Environmental Inc Earnings Call

February 11, 2026

We'll beachy.

Operator: At this time, I would now like to turn the call over to Patrick Dovigi, Founder and CEO of GFL. You may now proceed.

Founder and CEO of Yeovil you May now proceed.

Thank you and good afternoon, I would like to welcome everyone to today's call and thank you for joining US. This afternoon, we will be reviewing our results for the fourth quarter and providing our guidance for 2026.

Patrick Dovigi: Thank you, and good afternoon. I would like to welcome everyone to today's call, and thank you for joining us. This afternoon, we will be reviewing our results for the Q4 and providing our guidance for 2026. I am joined this afternoon by Luke Pelosi, our CFO, who will take us through our forward-looking disclaimer before we get into the details.

I'm joined this afternoon by Luc <unk>, our CFO, who will take us through our forward looking disclaimer before we get into the details.

Thank you Patrick good afternoon, everyone. Thank you for joining we have filed our earnings press release, which includes important information. The press release is available on our website. During this call we'll be making some forward looking statements within the meaning of applicable Canadian and U S securities laws, including statements regarding events or developments that we believe or anticipate may occur in the future.

Luke Pelosi: Thank you, Patrick. Good afternoon, everyone. Thank you for joining. We have filed our earnings press release, which includes important information. The press release is available on our website. During this call, we'll be making some forward-looking statements within the meaning of applicable Canadian and US securities laws, including statements regarding events or developments that we believe or anticipate may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set out in our filings with the Canadian and US securities regulators. Any forward-looking statement is not a guarantee of future performance, and actual results may differ materially from those expressed or implied in the forward-looking statements. These forward-looking statements speak only as of today's date, and we do not assume any obligation to update these statements, whether as a result of new information, future events, and developments, or otherwise.

These forward looking statements are subject to a number of risks and uncertainties, including those set out in our filings with the Canadian Securities regulators any forward looking statement is not a guarantee of future performance and actual results may differ materially from those expressed or implied in the forward looking statements. These forward looking statements speak only as of today's date and.

We do not assume any obligation to update these statements whether as a result of new information future events and developments or otherwise.

Call will include a discussion of certain non <unk> measures. A reconciliation of these non <unk> measures can be found in our filings with the Canadian and U S Securities regulators I will now turn the call back over to Patrick Thank.

Speaker #1: Good evening, everyone, and thank you for attending today's GFL Q4, 2025 earnings call. My name is Jasmine, and I will be your moderator today.

Operator: Good evening, everyone, and thank you for attending today's GFL Q4 2025 Earnings Call. My name is Jasmine, and I will be your moderator today. All lines will be muted during the presentation portion of the call with the opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. At this time, I would now like to turn the call over to Patrick Dovigi, founder and CEO of GFL. You may now proceed.

Luke Pelosi: This call will include a discussion of certain non-IFRS measures. A reconciliation of these non-IFRS measures can be found in our filings with the Canadian and US securities regulators. I'll now turn the call back over to Patrick.

Speaker #1: All lines will be muted during the presentation portion of the call with the opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad.

Thank you Luke.

We started 2025 by presenting our strategy to drive best in class financial results and this year's results demonstrate we are doing exactly what we said we would.

Patrick Dovigi: Thank you, Luke. We started 2025 by presenting our strategy to drive best-in-class financial results, and this year's results demonstrate we are doing exactly what we said we would. Our relentless focus on value creation through the optimization of our existing platform is yielding results that are consistently ahead of expectations, and our future has never been brighter. In 2025, we reached a historical milestone of 30% Adjusted EBITDA margin for the first time in our company's history. This result is attributable to the tireless efforts of our 15,000 employees and ongoing contributions from implementing the operational priorities we highlighted at last year's Investor Day. Ongoing price recovery, along with the operational efficiency within our portfolio, remain a core focus to drive appropriate returns for the high-quality services we provide.

Speaker #1: time, I would now like to turn the call over At this to Patrick Dovigi, founder and CEO of GFL. You may now

Our relentless focus on value creation through the optimization of our existing platform is yielding results that are consistently ahead of expectations and our future has never been brighter.

Speaker #1: proceed. Thank you.

Patrick Dovigi: Thank you, and good afternoon. I would like to welcome everyone to today's call and thank you for joining us. This afternoon, we will be reviewing our results for Q4 and providing our guidance for 2026. I am joined this afternoon by Luke Pelosi, our CFO, who will take us through our forward-looking disclaimer before we get into the details.

Speaker #2: Good afternoon. I would like to welcome everyone to today's call and thank you for joining us. This afternoon, we will be reviewing our results for the fourth quarter and providing our guidance for 2026.

In 2025, we reached a historical milestone of 30% adjusted EBITDA margin for the first time in our company's history.

This result is attributable to the tireless efforts of our 15000 employees and ongoing contributions from implementing the operational priorities, we highlighted at last year's Investor Day.

Speaker #2: I am joined this afternoon by Luke Pelosi, our CFO, who will take us through our forward-looking disclaimer before we get into the

Speaker #3: Thank you, Patrick. Good afternoon, everyone. Thank you for joining. We have filed our earnings press release, which includes important information. The press release is available on our website.

Ongoing price discovery, along with the operational efficiencies within our portfolio remain a core focus to drive appropriate returns for the high quality service we provide in.

Speaker #3: During this call, we'll be making some forward-looking statements within the meaning of applicable Canadian and U.S. securities laws, including statements regarding events or developments that we believe or anticipate may occur in the future.

In 2025, we meaningfully outperformed our initial price expectation.

Patrick Dovigi: In 2025, we meaningfully outperformed our initial price expectations, furthered our realization of the incremental pricing opportunities we identified at Investor Day. The pricing environment remains constructive, and we are confident in our ability to continue to price at an appropriate spread above our internal cost of inflation. Q4 volumes were ahead of plan, and we ended the year with 50 basis points of positive volume, a remarkable achievement considering the macro environment we're in. We see this differentiated outcome as yet another testament to the quality of our portfolio, underpinned by our overall market selection and the execution of our returns-focused capital deployment strategy. Consistent with Q3, both operational and SG&A cost intensity continued to trend lower in the quarter and for the full year.

And our realization of the incremental pricing opportunities.

Speaker #3: These forward-looking statements are subject to a number of risks and uncertainties, including those set out in our filings with the Canadian and U.S. securities regulators.

<unk> Investor day.

The pricing environment remains constructive and we are confident in our ability to continue to price at an appropriate spread above our internal cost of inflation.

Speaker #3: Any forward-looking statement is not a guarantee of future performance and actual results may differ materially from those expressed or implied in the forward-looking statements.

Q4 volumes were ahead of plan and we ended the year with 50 basis points of positive volume a remarkable achievement considering the macro environment. We're in.

Speaker #3: These forward-looking statements speak only as of today's date, and we do not assume any obligation to update these statements, whether as a result of new information, future events and developments, or otherwise.

We've seen a differentiated outcome is yet another testament to the quality of our portfolio underpinned by our overall market selection and the execution of our returns focused capital deployment strategy.

Speaker #3: This call will include a discussion of certain non-IFRS measures, a reconciliation of these non-IFRS measures can be found in our filings with the Canadian and U.S.

Consistent with the third quarter, both operational and SG&A cost intensity continued to trend lower in the quarter and for the full year.

Speaker #3: regulators. I'll now turn the call back over to securities

Speaker #3: Patrick. Thank you,

Patrick Dovigi: Thank you, Luke. We started 2025 by presenting our strategy to drive best-in-class financial results, and this year's results demonstrate we are doing exactly what we said we would. Our relentless focus on value creation through the optimization of our existing platform is yielding results that are consistently ahead of expectations, and our future has never been brighter. In 2025, we reached the historical milestone of 30% Adjusted EBITDA margin for the first time in our company's history. This result is attributable to the tireless efforts of our 15,000 employees and ongoing contributions from implementing the operational priorities we highlighted at last year's Investor Day. Ongoing price discovery, along with the operational efficiencies within our portfolio, remain a core focus to drive appropriate returns for the high-quality services we provide.

Speaker #2: Luke. We started 2025 by presenting our strategy to drive best-in-class financial results, and this year's results demonstrate we are doing exactly what we said we would.

Believer the levers we outlined at Investor day continue to contribute to this performance, including enhanced operational efficiency, improving labor turnover fleet optimization and procurement benefits as a result of our greater scale.

Patrick Dovigi: The levers we outlined at Investor Day continued to contribute to this performance, including enhanced operational efficiency, improving labor turnover, fleet optimization, and procurement benefits as a result of our greater scale. The combined impacts of these initiatives are apparent in the 30% Adjusted EBITDA margin we achieved for the year, an industry-leading 130 basis point increase over 2024. To achieve such a result in the face of an ongoing macro headwind reinforces our conviction in our stated goal of achieving low to mid-30s margins by 2028. 2025 was also a transformative year in terms of our capital allocation strategy. The benefits, which include the sale of our ES segment, simplified our business into a pure-play solid waste leader.

Speaker #2: Our relentless focus on value creation through the optimization of our existing platform is yielding results that are consistently ahead of expectations and our future has never been brighter.

The combined impact of these initiatives are apparent in the 30% adjusted EBITDA margin, we achieved for the year.

Speaker #2: In 2025, we reached the historical milestone of 30% adjusted EBITDA margin for the first time in our company's history. This result is attributable to the tireless efforts of our 15,000 employees and ongoing contributions from implementing the operational priorities we highlighted at last year's investor day.

An industry, leading 130 basis point increase over 2024.

To achieve such a result in the face of an ongoing macro headwinds reinforces our conviction in our stated goal of achieving low to mid 30% margins by 2028.

Speaker #2: Ongoing price discovery, along with the operational efficiencies within our portfolio, remain a core focus to drive appropriate returns for the high-quality services we provide.

2025 was also transformative year in terms of our capital allocation strategy. The benefits, which include the sale of our Es segment, simplifying our business into a pure play solid waste leader.

Speaker #2: In 2025, we meaningfully outperformed expectations and furthered our realization of the initial incremental pricing opportunities we identified at investor day. The pricing environment remains constructive, and we are confident in our ability to continue to price at an appropriate spread above our internal cost of inflation.

Patrick Dovigi: In 2025, we meaningfully outperformed our initial price expectations, furthered our realization of the incremental pricing opportunities we identified at Investor Day. The pricing environment remains constructive, and we are confident in our ability to continue to price at an appropriate spread above our internal cost of inflation. Q4 volumes were ahead of plan, and we ended the year with 50 basis points of positive volume, a remarkable achievement considering the macro environment we're in. We see this differentiated outcome as yet another testament to the quality of our portfolio, underpinned by our overall market selection and the execution of our returns-focused capital deployment strategy. Consistent with the third quarter, both operational and SG&A cost intensity continued to trend lower in the quarter and for the full year.

The evaluations achieved in both the Es transaction and recapitalization of GIC demonstrated the equity value. We have created in both of these assets.

Patrick Dovigi: The evaluations achieved in both the ES transaction and recapitalization of GIP demonstrated the immense equity value we have created in both of these assets. Our retained investment in these businesses allows GFL to continue to participate in meaningful value creation. The proceeds received from the divestitures and recapitalization allowed us to materially delever our balance sheet and buy back over 10% of our own stock. We deployed nearly $1 billion into accretive M&A, largely in the back half of the year, providing an incremental tailwind as we head into 2026. Regarding the share buybacks, recall that we originally intended to deploy $2.25 billion of the ES proceeds into share repurchases, a level of investment that we completed early in the first half of the year.

Our retained investment in these businesses allows <unk> to continue to participate in meaningful value creation.

Speaker #2: Q4 volumes were ahead of plan, and we ended the year with 50 basis points of positive volume—a remarkable achievement considering the macro environment we're in.

The proceeds received from the debentures and recapitalization allowed us to materially Delever, our balance sheet and buyback over 10% of our own stock.

Speaker #2: We see this differentiated outcome as yet another testament to the quality of our portfolio underpinned by our overall market selection and the execution of our returns-focused capital deployment strategy.

We deployed nearly $1 billion in to accretive M&A largely in the back half of the year, providing an incremental tailwind as we head into 2026.

Regarding the share buybacks recall that we originally intended to deploy $2 25 billion.

Speaker #2: Consistent with the third quarter, both operational and SG&A cost intensity continued to trend lower in the quarter and for the full year. The levers we outlined at investor day continue to contribute to this performance.

The es proceeds into share repurchases our level of investment that we completed early in the first half of the year.

Patrick Dovigi: The levers we outlined at Investor Day continue to contribute to this performance, including enhanced operational efficiency, improving labor turnover, fleet optimization, and procurement benefits as a result of our greater scale. The combined impacts of these initiatives are apparent in the 30% Adjusted EBITDA margin we achieved for the year, an industry-leading 130 basis point increase over 2024. To achieve such a result in the face of an ongoing macro headwind reinforces our conviction in our stated goal of achieving low to mid-30 margins by 2028. 2025 was also a transformative year in terms of our capital allocation strategy, the benefits which include the sale of our ES segment simplified our business into a pure-play solid waste leader. The valuations achieved in both the ES transaction and recapitalization of GIP demonstrated the immense equity value we had created in both of these assets.

Due to the share price dislocation in the second half of the year, we saw additional share repurchases as a highly prudent use of capital to create shareholder value over the long term.

Speaker #2: Including enhanced operational efficiency, improving labor turnover, fleet optimization, and procurement benefits as a result of our greater scale. The combined impacts of these initiatives are apparent in the 30% adjusted EBITDA margin we achieved for the year.

Patrick Dovigi: Due to the share price dislocation in the second half of the year, we saw additional share repurchases as a highly prudent use of capital to create shareholder value over the long term. As a result, we deployed an additional CAD 750 million into incremental buybacks. Inclusive of both the CAD 1 billion of M&A spend and the incremental share repurchases, we exited 2025 with the lowest year-end net leverage in our history. With the benefits of the implementation of the capital allocation strategy in place, we enter 2026 with ultimate balance sheet flexibility. This setup, together with natural deleveraging from organic growth, will allow us to execute on our robust M&A pipeline while maintaining leverage in the low to mid-threes as a range to which we remain highly committed.

As a result, we deployed an additional $750 million into incremental buybacks.

Speaker #2: An industry-leading $130 basis point increase over 2024. To achieve such a result in the face of an ongoing macro headwind, reinforces our conviction in our stated goal of achieving low to mid-30s margins by 2028.

Inclusive of both the $1 billion of M&A spend and the incremental share repurchases, we exited 2025 with the lowest.

Year end net leverage in our history.

With the benefits of the implementation of the capital allocation strategy in place, we entered 2026 with ultimate balance sheet flexibility.

Speaker #2: 2025 was also a transformative year in terms of our capital allocation strategy. The benefits, which include the sale of our ES segment, simplified our business into a pure play solid waste leader. The valuations achieved in both the ES transaction and recapitalization of GIP demonstrated the immense equity value we have created in both of these assets. Our retained investment in these businesses allows GFL to continue to participate in meaningful value creation. The proceeds received from the divestitures strengthened our balance sheet and allowed us to buy back over 10% of our own stock.

This setup together with natural deleveraging from organic growth will allow us to execute on a robust M&A pipeline, while maintaining leverage in the low to mid threes as a range to what we remain highly committed.

As for the base business guidance, Luke will walk us through the details, but it's exactly as we previously indicated recall that in 2024 and in 2025, we laid out an extremely detailed plan raise the guide multiple times throughout the year and beat our expectations on all financial metrics we.

Patrick Dovigi: So the base business guidance, Luke will walk us through the details, but it's exactly as we previously indicated. We called that in 2024 and in 2025, we laid out an extremely detailed plan, raised the guide multiple times throughout the year, and beat our expectations on all financial metrics. We see multiple avenues of upside to our current 2026 guide, and that gives us confidence in our ability to meet and potentially exceed the expectations for the year. Lastly, in 2025, we also progressed on our previously stated intention to maximize index inclusion opportunities. Last month, we announced the relocation of our executive headquarters to the US. The relocation broadens our eligibility for participation in US equity indices, while preserving our eligibility for inclusion in Canadian indices.

Patrick Dovigi: Our retained investment in these businesses allows GFL to continue to participate in meaningful value creation. The proceeds received from the divestitures and recapitalization allowed us to materially delever our balance sheet and buy back over 10% of our own stock. We deployed nearly CAD 1 billion into accretive M&A, largely in the back half of the year, providing an incremental tailwind as we head into 2026. Regarding the share buybacks, recall that we originally intended to deploy CAD 2.25 billion of the ES proceeds into share repurchases, a level of investment that we completed early in the first half of the year. Due to the share price dislocation the second half of the year, we saw additional share repurchases as a highly prudent use of capital to create shareholder value over the long term. As a result, we deployed an additional CAD 750 million into incremental buybacks.

We see multiple avenues of upside to our current 2026 guide and that gives us confidence in our ability to meet and potentially exceed the expectations for the year.

Speaker #2: We deployed nearly $1 billion into a creative M&A largely in the back half of the year providing an incremental tailwind as we head into 2026.

Lastly in 2025, we also progressed on our previously stated intention to maximize index inclusion opportunities.

Speaker #2: Regarding the share buybacks, recall that we originally intended to deploy $2.25 billion of the ES proceeds into share repurchases. A level of investment that we completed early in the first half of the year.

Last month, we announced the relocation of our executive headquarters to the U S.

The relocation relocation broadens our eligibility for participation in U S equity indices, while preserving our eligibility for inclusion in Canadian industry.

Speaker #2: Due to the share price dislocation in the second half of the year, we saw additional share repurchases as a highly prudent use of capital to create shareholder value over the long term.

We expect this strategy will help increase <unk> visibility with investors and ultimately drive a wider shareholder base.

Patrick Dovigi: We expect this strategy will help increase GFL's visibility with investors and ultimately drive a wider shareholder base. I'll now pass the call over to Luke to walk through the quarter and guide us into more depth, and then share some closing comments before we open it up for Q&A.

Speaker #2: As a result, we deployed an additional $750 million into incremental buybacks. Inclusive of both the $1 billion of M&A spend and the incremental share repurchases, we exited 2025 with the lowest year-end net leverage in our history.

I'll now pass the call over to Luke to walk through the quarter and guidance in more depth and then share some closing comments before we open it up for Q&A.

Patrick Dovigi: Inclusive of both the $1 billion of M&A spend and the incremental share repurchases, we exited 2025 with the lowest year-end net leverage in our history. With the benefits of the implementation of the capital allocation strategy in place, we enter 2026 with ultimate balance sheet flexibility. This setup, together with natural deleveraging from organic growth, will allow us to execute on a robust M&A pipeline while maintaining leverage in the low to mid-3s, as a range to which we remain highly committed. As for the base business guidance, Luke will walk us through the details, but it's exactly as we previously indicated. Recall that in 2024 and in 2025, we laid out an extremely detailed plan, raised the guide multiple times throughout the year, and beat our expectations on all financial metrics.

Thanks, Patrick.

Q4 revenues grew seven 3% on accounts of better than expected contributions from pricing volume and M&A, which more than offset.

Luke Pelosi: Thanks, Patrick. Q4 revenues grew 7.3% on account of better-than-expected contributions from pricing, volume, and M&A, which more than offset the greater than anticipated headwinds from FX. Pricing was 6.4% for the quarter and 6.1% for the year, 70 bps better than our original plan, largely on account of EPR transitional benefits and realization of the incremental pricing opportunities we articulated at Investor Day. The sequential quarterly acceleration of price throughout 2025 sets us up with a very high visibility into 2026 pricing. Q4 volumes were 70 basis points ahead of plan, largely on account of unanticipated special waste activity in several of our markets. Lapping hurricane volume, the initial ramp of EPR, and the commencement of a larger municipal contract in the prior year were the primary drivers of the negative volume print for the quarter.

Speaker #2: benefits of the implementation of the capital With the allocation strategy in place, we enter 2026 with ultimate balance sheet flexibility. This setup, together with natural deleveraging from organic growth, will allow us to execute in a robust M&A pipeline while maintaining leverage in the low to mid-3s as arranged to what we remain highly committed.

Greater than anticipated headwinds from FX.

Pricing was six 4% for the quarter and six 1% for the year 70 bps better than our original plan largely on account of ECR transitional benefits and realization of the incremental pricing opportunities, we articulated at Investor day.

Speaker #2: As for the base business guidance, Luke will walk us through the details, but it's exactly as we previously indicated. Recall that in 2024 and in 2025, we laid out an extremely detailed plan, raised the guide multiple times throughout the year, and beat our expectations on all financial metrics.

The sequential quarterly acceleration of price throughout 2025 sets us up with a very high visibility into 2026 pricing Q.

Q4 volumes were 70 basis points ahead of plan largely on account of unanticipated special waste activity in several of our markets.

Last thing Hurricane volume the initial ramp of ECR and the commencement of a larger municipal contract in the prior year were the primary drivers of the negative volume print for the quarter.

Speaker #2: We see multiple avenues of upside to our current 2026 guide, and that gives us confidence in our ability to meet and potentially exceed the expectations for the year.

Patrick Dovigi: We see multiple avenues of upside to our current 2026 guide, and that gives us confidence in our ability to meet and potentially exceed the expectations for the year. Lastly, in 2025, we also progressed on our previously stated intention to maximize index inclusion opportunities. Last month, we announced the relocation of our executive headquarters to the US. The relocation broadens our eligibility for participation in US equity indices while preserving our eligibility for inclusion in Canadian indices. We expect this strategy will help increase GFL's visibility with investors and ultimately drive a wider shareholder base. I'll now pass the call over to Luke to walk through the quarter and guide into more depth and then share some closing comments before we open it up for Q&A.

Speaker #2: Lastly, in 2025, we also progressed on our previously stated intention to maximize index inclusion opportunities. Last month, we announced the relocation of our executive headquarters to the U.S.

Sandy related volume continued to be soft, but we remain well positioned for a broader economic recovery in this end of our business when it happens.

Luke Pelosi: C&D-related volume continued to be soft, but we remain well-positioned for a broader economic recovery in this end of our business when it happens. Adjusted EBITDA margins continues to expand, with Q4 margins reaching 30.2%, the highest Q4 margin in our history. Adjusted EBITDA margins were up 175 basis points in our Canadian segment and behind 10 basis points in the US. Although US margins were materially up when excluding the impact of prior year hurricane volumes, acquisitions, and commodity prices. Commodities continued to be a drag on margins, with market pricing decelerating another 10% from Q3. Excluding the impact of commodities and these other non-reflective items, Q4 underlying consolidated margins were up over 150 basis points from the prior year. The outperformance in Q4 resulted in full-year Adjusted EBITDA of CAD 1.985 billion.

Adjusted EBITDA margins continues to expand with Q4 margins, reaching 32% the highest Q4 margin in our history.

Speaker #2: The relocation brought us our eligibility for participation in US equity indices while preserving our eligibility for inclusion in Canadian indices. We expect this strategy will help increase GFL's visibility with investors and ultimately drive a wider shareholder base.

Adjusted EBITDA margins were up 175 basis points in our Canadian segment, and behind 10 basis points in the U S. Although U S margins were materially up when excluding the impact of prior year hurricane volumes and acquisitions in commodity prices.

Speaker #2: I'll now pass the call over to Luke to walk through the quarter and guidance in a more depth and then share some closing comments before we open it up for Q&A.

Commodities continued to be a drag on margins with market pricing decelerating another 10% from Q3.

Speaker #1: Thanks, Patrick. Q4 revenues grew 7.3% on account of better-than-expected contributions from pricing, volume, and M&A, which more than offset greater-than-anticipated headwinds from FX.

Luke Pelosi: Thanks, Patrick. Q4 revenues grew 7.3% on account of better-than-expected contributions from pricing, volume, and M&A, which greater than anticipated headwinds from FX. Pricing was 6.4% for the quarter and 6.1% for the year, 70 bps better than our original plan, largely on account of EPR transitional benefits and realization of the incremental pricing opportunities we articulated at Investor Day. The sequential quarterly acceleration of price throughout 2025 sets us up with a very high visibility into 2026 pricing. Q4 volumes were 70 basis points ahead of plan, largely on account of unanticipated special waste activity in several of our markets. Lapping hurricane volume, the initial ramp of EPR, and the commencement of a larger municipal contract in the prior year were the primary drivers of the negative volume print for the quarter.

Excluding the impact of commodities and these other non reflective items Q4 underlying consolidated margins were up over 150 basis points from the prior year.

The outperformance in Q4 resulted in full year adjusted EBITDA of $1 95 billion.

Speaker #1: Pricing was 6.4% for the quarter and 6.1% for the year—70 basis points better than our original plan. This was largely on account of EPR transitional benefits and realization of the incremental pricing opportunities we articulated at Investor Day.

Note that using the same FX rate on which our original guidance was given the full year amount would have been approximately $2 billion over $50 million better than the high end of our original guide despite the commodity and C&D volume headwinds.

Luke Pelosi: Note that using the same FX rate on which our original guidance was given, the full year amount would have been approximately $2 billion, over $15 million better than the high end of our original guide, despite the commodity and C&D volume headwinds. Adjusted Free Cash Flow was $425 million for Q4, and $756 million for 2025, ahead of plan on account of the EBITDA outperformance, as the other inputs were largely in line with expectations. Adjusted Free Cash Flow conversion improved to 38%, inclusive of the impacts of headwinds from M&A and FX. During the fourth quarter, we completed the incremental M&A that we had previewed in Q3, setting us up for meaningful revenue rollover into 2026, consistent with the initial framework we provided.

Speaker #1: The sequential quarterly acceleration of price throughout 2025 sets us up with a very high visibility into 2026 pricing. Q4 volumes were 70 basis points ahead of plan, largely on account of unanticipated special waste activity in several of our markets.

Adjusted free cash flow was $425 million for Q4 and $756 million for 2025 ahead of plan on account of the EBITDA outperformance.

Other inputs were largely in line with expectations.

Adjusted free cash flow conversion improved to 38% inclusive of the impacts of headwinds from M&A and FX.

Speaker #1: Lapping hurricane volume, the initial ramp of EPR, and the commencement of a larger municipal contract in the prior year were the primary drivers of the negative volume print for the quarter.

During the fourth quarter, we completed the incremental M&A that we had previewed in Q3 setting us up for meaningful revenue rollover into 2026 consistent with the initial framework we provided.

Speaker #1: C&D-related volume continued to be soft, but we remain well-positioned for a broader economic recovery in this end of our business when it happens.

Luke Pelosi: C&D-related volume continued to be soft, but we remain well-positioned for a broader economic recovery in this end of our business when it happens. Adjusted EBITDA margins continues to expand, with Q4 margins reaching 30.2%, the highest Q4 margin in our history. Adjusted EBITDA margins were up 175 basis points in our Canadian segment and behind 10 basis points in the US, although US margins were materially up when excluding the impact of prior-year hurricane volumes and acquisitions in commodity prices. Commodities continued to be a drag on margins, with market pricing decelerating another 10% from Q3. Excluding the impact of commodities and these other non-reflective items, Q4 underlying consolidated margins were up over 150 basis points from the prior year. The outperformance in Q4 resulted in full-year adjusted EBITDA of CAD 1.985 billion.

Speaker #1: Adjusted EBITDA margins continue to expand, with Q4 margins reaching 30.2%, the highest Q4 margin in our history. Adjusted EBITDA margins were up 175 basis points in our Canadian segment and down 10 basis points in the US.

We also bought back over $200 million of our own shares during the quarter, bringing annual share repurchases totaled to $3 billion <unk>.

Luke Pelosi: We also bought back over $200 million of our own shares during the quarter, bringing annual share repurchases total to $3 billion. Inclusive of the approximately $4 billion we deployed into M&A and share repurchases, we ended the year with net leverage of 3.4 times. As Patrick said, the lowest year-end net leverage in our history. Excluding the $750 million of incremental share buybacks, year-end net leverage would have been 3.1 times. The strong finish to 2025, combined with our positive forward outlook, allows for 2026 guidance better than the initial framework we provided in Q3.

Inclusive of the approximately $4 billion, we deployed to M&A and share repurchases. We ended the year with net leverage of three four times as Patrick said, the lowest year end net leverage in our history.

Speaker #1: Although US margins were materially up when excluding the impact of prior year hurricane volumes and acquisitions in commodity prices. Commodities continued to be a drag on margins, with market pricing decelerating another 10% from Q3.

Excluding the $750 million of incremental share buybacks year end net leverage would have been three one times.

The strong finish to 2025 combined with our positive forward outlook allows for 2026 guidance better than the initial framework we provided in Q3.

Speaker #1: Excluding the impact of commodities and these other non-reflective items, Q4 underlying consolidated margins were up over 150 basis points from the prior year. The outperformance in Q4 resulted in full year adjusted EBITDA of 1.985 billion.

To level set on the guide when we previously provided our 2026 framework. We did so assuming an FX rate of $1 four O, which was the FX rate at the time and coincidentally the average rate for all of 2025.

Luke Pelosi: To level set on the guide, when we previously provided our 2026 framework, we did so assuming an FX rate of 1.40, which was the FX rate at the time, and coincidentally, the average rate for all of 2025. Consistent with our past practice, we are providing our actual 2026 guidance using the current FX rate of 1.36. Any changes to the FX rate will cause translational impacts to our reported results. Recall that every 1-point change in FX impacts revenue by approximately $35 million and adjusted EBITDA by approximately $11 million. 2026 revenue is expected to be approximately $7 billion or $7.14 billion on a constant currency basis, an 8% increase over 2025.

Speaker #1: Note that using the same FX rate on which our original guidance was given, the full year amount would have been approximately $2 billion, over $15 million better than the high end of our original guide despite the commodity and C&D volume headwinds.

Luke Pelosi: Note that using the same FX rate on which our original guidance was given, the full-year amount would have been approximately $2 billion, over $50 million better than the high end of our original guide despite the commodity, and C&D volume headwinds. Adjusted free cash flow was $425 million for Q4 and $756 million for 2025, ahead of plan on account of the EBITDA outperformance as the other inputs were largely in line with expectations. Adjusted free cash flow conversion improved to 38%, inclusive of the impacts of headwinds from M&A, and FX. During the fourth quarter, we completed the incremental M&A that we had previewed in Q3, setting us up for meaningful revenue rollover into 2026 consistent with the initial framework we provided. We also bought back over $200 million of our own shares during the quarter, bringing annual share repurchases totaled to $3 billion.

System with our past practice, we are providing our actual 2026 guidance using the current FX rate of 136.

Any changes to the FX rate will cause translational impacts to our reported results.

Speaker #1: Adjusted free cash flow was $425 million for Q4 and $756 million for 2025, ahead of plan on account of the EBITDA outperformance as the other inputs were largely in line with expectations.

Call that every one point change in FX impacts revenue by approximately $35 million and adjusted EBITDA by approximately $11 million.

2026 revenue is expected to be approximately $7 billion or 714 billion on a constant currency basis, and 8% increase over 2025.

Speaker #1: Adjusted free cash flow conversion improved to 38%, inclusive of the impacts of headwinds from M&A the fourth quarter, we completed the and FX. During incremental M&A that we had previewed in Q3, setting us up for meaningful revenue rollover into 2026, consistent with the initial framework we provided.

Pricing is expected to be in the mid fives, driven by our base pricing programs and incremental contributions from EPR.

Luke Pelosi: Pricing is expected to be in the mid-5s, driven by our base pricing programs and incremental contributions from EPR. The pricing plan includes modest progression in our ancillary surcharge programs, and any implementation acceleration in this area will be a source of upside. Q4 commodity prices were down 33% year-over-year, and today's prices are approximately 20% less than the average price in 2025. Based on these current price levels, commodity and fuel prices are expected to create a 50 basis point headwind to revenue growth in 2026. Any improvement to commodity prices throughout the year will be additive to our results. Volumes are expected to be positive 25 to 50 basis points. There are a couple more sizable impacts included in this number, namely around hurricane volumes in Q1, EPR transition, and tangential residential contracts.

The pricing plan includes modest progression in our ancillary surcharge programs and any implementation acceleration in this area will be a source of upside.

Speaker #1: We also bought back over $200 million of our own shares during the quarter, bringing annual share repurchases total to $3 billion. Inclusive of the approximately $4 billion we deployed into M&A and share repurchases, we ended the year with net leverage of 3.4 times, as Patrick said, the lowest year-end net leverage in our history.

Q4 commodity prices were down 33% year over year and today's prices are approximately 20% less than the average price in 2025.

Luke Pelosi: Inclusive of the approximately $4 billion we deployed into M&A and share repurchases, we ended the year with net leverage of 3.4 times, as Patrick said, the lowest year-end net leverage in our history. Excluding the $750 million of incremental share buybacks, year-end net leverage would have been 3.1 times. A strong finish to 2025, combined with our positive forward outlook, allows for 2026 guidance better than the initial framework we provided in Q3. To level set on the guide, when we previously provided our 2026 framework, we did so assuming an FX rate of 1.40, which was the FX rate at the time and, coincidentally, the average rate for all of 2025. Consistent with our past practice, we are providing our actual 2026 guidance using the current FX rate of 1.36. Any changes to the FX rate will cause translational impacts to our reported results.

Based on these current price levels commodity and fuel prices are expected to create a 50 basis point headwind to revenue growth in 2026.

Speaker #1: Excluding the $750 million of incremental share buybacks, year-end net leverage would have been 3.1 times. The strong finish to 2025, combined with our positive forward outlook, allows for 2026 guidance better than the initial framework we provided in Q3.

The improvement in commodity prices throughout the year will be additive to our results.

Volumes are expected to be positive 25 to 50 basis points.

There were a couple of more sizable impacts included in this number namely around hurricane volumes in Q1, EPR transition in tangential residential contracts. Excluding these headwinds underlying volumes are expected to grow closer to 100 basis points.

Speaker #1: To level set on the guide, when we previously provided our 2026 framework, we did 1.40, which was the FX rate at the time and coincidentally the average rate for all of 2025.

Luke Pelosi: Excluding these headwinds, underlying volumes are expected to grow closer to 100 basis points. M&A is expected to add 250 basis points of revenue growth, and using an FX rate of 1.36 creates a 210 basis point headwind. Adjusted EBITDA in 2026 is expected to be $2.14 billion or $2.185 billion on a constant currency basis, an increase of 10%. Adjusted EBITDA margins are expected to expand by an industry-leading 60 basis points, overcoming the headwinds from lower commodity prices and FX rates. The implied 30.6% margin for 2026 reflects an over 500 basis point expansion of margins over the four-year period since 2022.

M&A is expected to add 250 basis points of revenue growth and using an FX rate of 136 creates a 210 basis point headwind.

Speaker #1: Consistent with our past practice, we are providing our actual 2026 guidance using the current FX rate of 1.36. Any changes to the FX rate will cause translational impacts to our reported results.

Adjusted EBITDA in 2026 is expected to be two <unk>, one 4 billion or $2 25 billion on a constant currency basis, an increase of 10%.

Speaker #1: Recall that every 1-point change in FX impacts revenue by approximately $35 million and adjusted EBITDA by approximately $11 million. 2026 revenue is expected to be approximately $7 billion, or $7.14 billion on a constant currency basis, an 8% increase over 2025.

Luke Pelosi: Recall that every one-point change in FX impacts revenue by approximately $35 million and Adjusted EBITDA by approximately $11 million. 2026 revenue is expected to be approximately $7 billion or $7.14 billion on a constant currency basis, an 8% increase over 2025. Pricing is expected to be in the mid-5s, driven by our base pricing programs and incremental contributions from EPR. The pricing plan includes modest progression in our ancillary surcharge programs, and any implementation acceleration in this area will be a source of upside. Q4 commodity prices were down 33% year-over-year, and today's prices are approximately 20% less than the average price in 2025. Based on these current price levels, commodity and fuel prices are expected to create a 50 basis point headwind to revenue growth in 2026. Any improvement to commodity prices throughout the year will be additive to our results.

Adjusted EBITDA margins are expected to expand by an industry, leading 60 basis points overcoming the headwinds from lower commodity prices and FX rates.

The implied 36% margin for 2026 reflects an over 500 basis point expansion in margins over the four year period since 2022.

Speaker #1: Pricing is expected to be in the mid-5s, driven by our base pricing programs and incremental contributions from EPR. The pricing plan includes modest progression in our ancillary surcharge programs and any implementation acceleration in this area will be a source of upside.

Adjusted free cash flow increases to $835 million or $860 million on a constant currency basis, and an increase of 14%.

Luke Pelosi: Adjusted free cash flow increases to CAD 835 million or CAD 860 million on a constant currency basis, an increase of 14%. The 2026 guide includes cash taxes more than what was previously expected, as the benefit of ITCs associated with RNG projects have shifted into 2027. If not for this change, adjusted free cash flow growth would have been closer to 20% on a constant currency basis. Included in the adjusted free cash flow guide is net CapEx of approximately CAD 800 million, cash interest of CAD 395 million, and other items of CAD 110 million. Excluded from adjusted free cash flow is approximately $175 million of incremental growth of CapEx, approximately 50% of the amount deployed in 2025, consistent with previous expectations.

For 2026 guide includes cash taxes more than what was previously expected as the benefit of ITC is associated with R&D projects have shifted into 2027, if not for this change adjusted free cash flow growth would've been closer to 20% on a constant currency basis.

Speaker #1: Q4 commodity prices were down 33% year over year and today's prices are approximately 20% less than the average price in 2025. Based on these current price levels, commodity and fuel prices are expected to create a 50 basis point headwind to revenue growth in 2026.

Included in the adjusted free cash flow guide is net capex of approximately 800 million cash interest of $395 million and other items of $110 million.

Speaker #1: Any improvement to commodity prices throughout the year will be additive to our results. Volumes are expected to be positive 25 to 50 basis points.

Luke Pelosi: Volumes are expected to be positive 25 to 50 basis points. There are a couple more sizable impacts included in this number, namely around hurricane volumes in Q1, EPR transition, and tangential residential contracts. Excluding these headwinds, underlying volumes are expected to grow closer to 100 basis points. M&A is expected to add 250 basis points of revenue growth, and using an FX rate of 1.36 creates a 210 basis point headwind. Adjusted EBITDA in 2026 is expected to be CAD 2.14 billion or CAD 2.185 billion on a constant currency basis, an increase of 10%. Adjusted EBITDA margins are expected to expand by an industry-leading 60 basis points, overcoming the headwinds from lower commodity prices and FX rates. The implied 30.6% margin for 2026 reflects an over 500 basis point expansion of margins over the four-year period since 2022.

Excluded from adjusted free cash flow was approximately $175 million of incremental growth. The capex approximately 50% of the amount deployed in 2025 consistent with previous expectations.

Speaker #1: There are a couple more sizable impacts included in this number, namely around hurricane volumes in Q1, EPR transition, and tangential residential contracts. Excluding these headwinds, underlying volumes are expected to grow closer to 100 basis points.

Adjusted free cash flow conversion as a percentage of adjusted EBITDA increase.

Speaker #1: M&A is expected to add 250 basis points of revenue growth, and using an FX rate of 1.36 creates a 210 basis point headwind. Adjusted EBITDA in 2026 is expected to be $2.14 billion, or $2.185 billion on a constant currency basis, an increase of 10%.

Luke Pelosi: Adjusted Free Cash Flow conversion as a percentage of Adjusted EBITDA increased-

Ladies and gentlemen.

Speaker #1: Adjusted EBITDA margins are expected to expand by an industry-leading 60 basis points, overcoming the headwinds from lower commodity prices and FX rates. The implied 30.6% margin for 2026 reflects an over 500 basis point expansion of margins over the four-year period since 2022.

Operator: One moment, ladies and gentlemen. One moment, ladies and gentlemen, as I try to get our speaker reconnected. Pardon the interruption. We now have our speakers back on, and we will now begin the Q&A session. As a reminder, please press star followed by one on your telephone keypad to ask a question. To remove your question, press star followed by two. We kindly ask that you limit your remarks to one question and one follow-up. We will pause you briefly as questions are registered.... Our first question comes from Patrick Brown with Raymond James. You may now proceed.

Speaker #1: Adjusted free cash flow increases to $835 million, or $860 million on a constant currency basis, an increase of 14%. For 2026 guide includes cash taxes, more than what was previously expected, as the benefit of ITCs associated with R&G projects have shifted into 2027.

Luke Pelosi: Adjusted free cash flow increases to $835 million or $860 million on a constant currency basis, an increase of 14%. The 2026 guide includes cash taxes more than what was previously expected, as the benefit of ITCs associated with R&G projects have shifted into 2027. If not for this change, adjusted free cash flow growth would have been closer to 20% on a constant currency basis. Included in the adjusted free cash flow guide is net CapEx of approximately $800 million, cash interest of $395 million, and other items of $110 million. Excluded from adjusted free cash flow is approximately $175 million of incremental growth CapEx, approximately 50% of the amount deployed in 2025 consistent with previous expectations. Adjusted free cash flow conversion as a percentage of Adjusted EBITDA increase.

Speaker #1: If not for this change, adjusted free cash flow growth would have been closer to 20% on a constant currency basis. Included in the adjusted free cash flow guide is net capex of approximately $800 million, cash interest of $395 million, and other million.

One moment, ladies and Jeremy I tried to get our speaker we communicate.

Speaker #1: Approximately 50% of the amount deployed in 2025 is consistent with previous expectations. Adjusted free cash flow conversion as a percentage of adjusted EBITDA increases. One moment, ladies and gentlemen.

Operator 2: One moment, ladies and gentlemen. One moment, ladies and gentlemen, if I try to get our speaker reconnected.

Luke Pelosi: One moment, ladies and gentlemen. One moment, ladies and gentlemen, if I try to get our speaker reconnected.

Pardon the interruption.

We now have our speakers back on and we will now begin the Q&A session.

As a reminder.

Please press star followed by one on your telephone keypad to ask a question to remove your question Press Star followed by two.

We kindly ask that you limit your remarks to one question and one follow up.

We'll pause briefly ask questions are registered.

Our first question comes from Patrick Brown with Raymond James You May now proceed.

Yeah.

Hey, Good afternoon, guys can you all hear me.

Yes can you hear the dollar.

Patrick Brown: Hey, good afternoon, guys. Can you all hear me?

Yeah, you there okay. Good deal Hey, Patrick I appreciate the guidance, Yes, Hey, I appreciate the guidance of low threes on the leverage but one does that assume.

Patrick Dovigi: Yes. Can you hear us, Tyler?

Patrick Brown: Yeah, you're there. Okay, good deal. Hey, Patrick, I appreciate the guidance. Yeah, hey, I appreciate the guidance of low threes on the leverage. But one, does that assume no incremental M&A and buyback? Is that right? And then I think you mentioned last quarter that 2026 could be an outsized M&A year, and I get that you're very active in the back half of 2025, but is that still your base case as we sit here today?

Does that assume no incremental M&A and buyback is that right and then I think you mentioned last quarter that 26 could be an outsized M&A year and I get that you're very active in the back half of 'twenty five but is that still your base case as we sit here today.

Yeah, I think to be crystal clear on our leverage point we.

We are committed to leverage as we said in the low to mid threes I think Luke made the point that you know absent any M&A you end the year close to three turns obviously doing incremental M&A and buybacks would increase that number but we are definitely committed to exiting 2026 at sort of low to mid <unk>.

Patrick Dovigi: Yeah. I think to be crystal clear on the leverage point, we are committed to leverage, as we said, in the low to mid threes. I think Luke made the point that, you know, absent any M&A, you end the year close to 3 turns. Obviously, doing incremental M&A and buybacks would increase that number, but we are definitely committed to exiting 2026 at sort of low to mid threes. Could there be a quarter where there's 25 to, you know, 40 basis points of leverage move around in a quarter? Sure. But we end the year exiting low threes to mid threes.

Could there be a quarter, where your 25 to 40 basis points.

Leverage move around in the quarter sure well, we end the year exiting low threes to mid threes.

Okay perfect. That's exactly what I was looking for Okay, and then Luke if I just try to do the EBITDA bridge I feel like there are a few kind of key things to think about.

Patrick Brown: Okay, perfect. Yep, exactly what I was looking for. Okay, and then Luke, if I just try to do the EBITDA bridge, I, I feel like there are a few kind of key things to think about. So one, it seems like you have something like $30 million of M&A rollover benefit. Again, this is on EBITDA. Two, on my math at least, you maybe have $40 million of EPR and RNG. Three, you have about a $45 million drag from FX, but if I took all of those, it feels like organic EBITDA is up maybe low to mid single digits, and I realize that commodities and a few things are in there, but is that conceptually close? 'Cause it feels, feels doable.

Patrick Dovigi: Okay, perfect. Yep, exactly what I was looking for. Okay, and then Luke, if I just try to do the EBITDA bridge, I, I feel like there are a few kind of key things to think about. So one, it seems like you have something like $30 million of M&A rollover benefit. Again, this is on EBITDA. Two, on my math at least, you maybe have $40 million of EPR and RNG. Three, you have about a $45 million drag from FX, but if I took all of those, it feels like organic EBITDA is up maybe low to mid single digits, and I realize that commodities and a few things are in there, but is that conceptually close? 'Cause it feels, feels doable.

One it seems like you have something like $30 million of M&A rollover benefit again. This is on EBITDA to on my math at least you maybe have 40 million of EPR and Orangey.

Three you have about a $45 million drag from FX, but if I took all of those it feels like organic EBITDA is up maybe low to mid single digits and I realize that commodities and a few things are in there but is that conceptually close because it feels feels doable.

Yes, hi, there, it's a great way of breaking it down and thank you for doing my rule for me I think Youre directionally right, but you seem to be taking just the good guys and not factoring in the bad guys right. So a couple of things.

Luke Pelosi: Yeah, Tyler, it's a great way of breaking it down, and thank you for doing my role for me. I think you're directionally right, but you seem to be taking just the good guys and not factoring in the bad guys, right?

<unk> is going against you right and so that is a pure sort of EBITDA hit that you will sort of have in that margin bridge. We have recall Q1, 'twenty five we enjoyed storm volumes and the southeast is associated with the hurricane very high margin contribution that youre not getting the benefit of that so that's sort of distorting that bridge a little bit and then.

Patrick Brown: Okay.

Luke Pelosi: So a couple things. Commodities going against you, right? And so that is a pure sort of EBITDA hit that you will sort of have. In that margin bridge we have, recall Q1 2025, we enjoyed storm volumes in the southeast associated with the hurricane. Very high margin contribution that you're not getting the benefit of that, so that's sort of distorting that bridge a little bit. And then on the EPR, while $40 million, you know, I think was the right way of thinking about it at the beginning of 2025, with the outperformance that 2025 has, I think that number comes in a little inside on the 2026 year-over-year comp. So if you normalize those, then I think you should get to a base business underlying organic EBITDA at the sort of mid to high single digits.

On the ETR, while 40 million I think was the right way of thinking about it at the beginning of 'twenty five with the outperformance of <unk> 25, I think that number comes in a little inside on the 26 year over year comp. So if you normalize. Those then I think you should get to our base business underlying organic EBITDA at the sort of mid to high.

High single digits and as you said.

We're feeling confident that thats something that can be achieved.

Luke Pelosi: As you said, you know, we're feeling confident that that's something that can be achieved.

Okay perfect. Thank you guys.

Thanks Tyler.

Patrick Brown: Okay, perfect. Thank you, guys.

Okay.

Thank you.

Patrick Dovigi: Thanks, Tyler.

Question comes from the heart.

<unk> with RBC you May now proceed.

Operator: Thank you. Our next question comes from Sabahat Khan with RBC. You may now proceed.

Okay, great. Thanks, and good afternoon, I'm, just I guess just following up on the commentary around EPR can you just maybe give us a little bit more color on the incremental growth capex investments that you're sort of calling out here.

Sabahat Khan: Okay, great. Thanks, and good afternoon. Just I guess, just following up on the commentary around EPR. Can you just maybe give us a little bit more color on the incremental growth CapEx investments that you're sort of calling out here? How does that sort of flow in through the course of the year? And just I guess, in terms of the RNG side and the EPR side, it sounds like the contribution is still there, but just maybe how does that ramp for 2026 and maybe into 2027? Thanks.

Does that sort of flowing through the course of the year and just I guess in terms of the R&D side and the PR side. It sounds like the contribution is still there, but just maybe how does that ramp or 26, and maybe into 'twenty Seth. Thanks.

Right.

Yeah, Hey, Great question, Luke speaking here.

175 is very front end loaded.

Luke Pelosi: Yeah. Hey, Saba, great question. Luke speaking here. The 175 is very front-end loaded. Just so you know, what's really coming on ETR this year is the collection side of the contracts, and the majority of that is actually for the payment of said trucks. So I think we're expecting sort of about $100 to $120 of that in Q1, and then sort of trickles in through the balance of the year. As we had alluded, RNG incremental contribution this year is more muted as projects have shifted to 2027. So the RNG contribution in the current plan is pretty flat in terms of dollars with 2025. You have slightly higher levels of production at a slightly lower RIN price.

The expectation just so you know what's really coming on ETR. This here's the collection side of the contracts and the majority of that is actually for the payment of said trucks. So I think as you explore respecting sort of about 100.

120 of that in Q1, and then sort of trickles in through the balance of the year.

As we had alluded RMG incremental contribution this year is more muted as projects have shifted to.

27, so the <unk> contribution in the current plan is pretty flat in terms of dollars with 25, you have slightly higher levels of production at a slightly lower RIN price.

And then the expectation is it sort of into 27 and 28 when you get the ramp of the tail of the RMG projects coming online growth spend in 2007, the equivalent of that number and then steps down significantly again.

Luke Pelosi: And then the expectation is it's sort of into 2027 and 2028 when you get the ramp of, you know, the tail of the RNG projects coming online. Growth spend in 2027, the equivalent of that number, I think, you know, steps down significantly again from where we are today, as EPR will largely be completed, and, you know, the RNG tail is relatively small. So we'll advise on 2027, you know, as we get closer to it, but, you know, the expectation today is it's again, a meaningful step down from this year.

From where we are today as EPR will largely be completed.

And you know the RMG tail is relatively small so well will advise on 27, you know as we get closer to it but in the expectation today is again, a meaningful step down from this year.

Yeah.

Great and then just on the volume portion it looks like you're guiding to modestly positive volumes can you, maybe just break that out a little bit across some of the puts and takes any shedding left in that and it is sort of what are you seeing across some of the more <unk>.

Sabahat Khan: Okay, great. And then just on the volume portion, it looks like you're guiding to modestly positive volumes. Can you maybe just break that out a little bit across some of the puts and takes, any shedding left in that? And in addition, sort of what are you seeing across some of the more cyclical end markets? Is the situation maybe somewhat better than 25? You can just kind of break out the volume piece a little bit. Thanks.

Cyclical end markets is a situational maybe somewhat better than 25, if you can just kind of break out the volume piece a little bit. Thanks.

Yes, I think we're giving the guide Saba based on today's macro conditions, which you know is.

Luke Pelosi: Yeah, I think we're giving the guide, Saba, based on today's macro conditions, which, you know, is continues to be soft on the sort of C&D or industrial end. Now, I think there are some green shoots out there that may suggest, you know, there's opportunity above that. And certainly, the benefit of that opportunity would be additive to the guide. If you think about the year for 25, Q1 started a little bit sort of stronger before some of the uncertainty was entered the macro environment, and I therefore think Q1 is a tougher comp. So we're expecting a negative volume number in Q1, and then that moderates as you start lapping the sort of tougher quarters that were sort of experienced in the back half of this year.

Sabahat Khan: Yeah, I think we're giving the guide, Saba, based on today's macro conditions, which, you know, is continues to be soft on the sort of C&D or industrial end. Now, I think there are some green shoots out there that may suggest, you know, there's opportunity above that. And certainly, the benefit of that opportunity would be additive to the guide. If you think about the year for 25, Q1 started a little bit sort of stronger before some of the uncertainty was entered the macro environment, and I therefore think Q1 is a tougher comp. So we're expecting a negative volume number in Q1, and then that moderates as you start lapping the sort of tougher quarters that were sort of experienced in the back half of this year.

Continues to be soft on the sort of C and D are industrial and now I think there are some green shoots out there that may suggest there's opportunity above that.

And certainly the benefit of that opportunity would be additive to the guide. If you think about the year for 25, Q1 started a little bit sort of stronger before some of the uncertainty was entered the macro environment and therefore. It then Q1 is a tougher comp. So we're expecting a negative volume number in Q1 and then.

That.

Moderates as you start lapping tougher quarters that were sort of experience in the back half of this year, we do have the benefit of EPR coming in and contributing and that is part of it and then also as Patrick alluded to we still take a lot of pride in our market selection and what I mean by that is a concentration of our revenues in the faster growing.

Luke Pelosi: We do have the benefit of EPR coming in and contributing, and that is a part of it. And then also, as Patrick alluded to, you know, we still take a lot of pride in our market selection. And what I mean by that is a concentration of our revenues in the faster-growing South and Southeast markets, where notwithstanding a perhaps more uncertain macro, you still do have volumetric growth by virtue of, you know, people moving and new business formation. So we're feeling good with the setup.

Sabahat Khan: We do have the benefit of EPR coming in and contributing, and that is a part of it. And then also, as Patrick alluded to, you know, we still take a lot of pride in our market selection. And what I mean by that is a concentration of our revenues in the faster-growing South and Southeast markets, where notwithstanding a perhaps more uncertain macro, you still do have volumetric growth by virtue of, you know, people moving and new business formation. So we're feeling good with the setup.

South and southeast markets, where notwithstanding a perhaps or uncertain macro you still do have volumetric growth by virtue of people moving and new business formation. So we're feeling good with the setup.

There's multiple avenues of upside above what we have in here, but we're very.

Luke Pelosi: You know, I think there's multiple avenues of upside above what we have in here, but we're, you know, very pleased to be able to sort of report a year of positive volume, where I think the industry as a whole is probably slightly negative, and to be able to reiterate that sort of positive outlook going into 2026 as well.

Sabahat Khan: You know, I think there's multiple avenues of upside above what we have in here, but we're, you know, very pleased to be able to sort of report a year of positive volume, where I think the industry as a whole is probably slightly negative, and to be able to reiterate that sort of positive outlook going into 2026 as well.

I'm pleased to be able to sort of report a year of positive volume and I think the industry as a whole is probably slightly negative and to be able to reiterate that sort of positive outlook going home to 26 as well.

And just maybe just a quick one if I can sneak it in there just on the capital allocation side, obviously, a very big year on buybacks and 25. It sounds like the M&A pipeline is reasonably good how do you guys sort of balance the two in terms of what seems more attractive on and all of your analysis there as how you view. Thanks.

Sabahat Khan: Just maybe just a quick one, if I can sneak it in there. Just on the capital allocation side, obviously a very big year on buybacks in 25. Sounds like the M&A pipeline is reasonably good. How do you guys sort of balance the two in terms of what seems more attractive on, you know, or your analysis, just how you view it? Thanks.

Yeah.

Yeah, I mean, obviously with.

The sell off in the sector and sort of where we are.

Patrick Dovigi: Yeah, I mean, obviously with, you know, the sell-off in the sector and sort of where we are, we, you know, we continue to believe the stock is materially undervalued. That being said, we need to balance that, you know, that that could correct itself very quickly, and our expectation is, is that it will in time. So we also have to plan for the future in some of these, you know, opportunities that are in front of us. You know, and as we continue to work through the opportunities, we'll sort of outweigh and weigh against one another, but what we think the right thing to do is. But just know that, you know, my 30 million shares are working beside every one of yours, so I'm gonna do what's right for what I believe sort of the long-term value creation for the business will be.

We continue to believe the stock is materially undervalued.

That being said, we need to balance that you know that that's incorrect itself very quickly and our expectation is that it will in time. So we also have to plan for the future and some of these opportunities.

Opportunities that are in front of us.

And as we continue to work through the opportunities for sort of.

Outweigh.

Against one another but when we think the right thing to do it but just know that.

You know my 30 million shares are working beside everyone. So I'm going to do what's right for what I believe is sort of a long term value creation for the business will be you know last year was.

Nearly all of this in the back half of the year that it was prudent to spend that incremental $750 million on share buybacks, just given where the stock was trading.

Patrick Dovigi: But, you know, last year was clearly obvious in the back half of the year that it was prudent to spend that incremental CAD 750 million on share buybacks, just given where the stock was trading. But that being said, we have a great pipeline as well, with good opportunities in markets where we're already operating and, you know, we'll continue looking at both and, and weighing them as the opportunities continue to present themselves.

That being said, we have a great pipeline as well with good opportunities in markets, where we're already operating and you know, we'll continue looking at Bolton and weighing there might be opportunities continue to present themselves.

Thanks very much.

Sabahat Khan: Thanks very much.

Thank you.

Our next question comes from Kevin Chiang with CIBC Wood Gundy you May now proceed.

Operator: Thank you. Our next question comes from Kevin Chiang with CIBC World Markets. You may now proceed.

Hi, Thanks for taking my question APA.

I apologize if I missed this.

You mentioned kind of saw sequential improvement in pricing as you've kind of got through.

Kevin Chiang: Thanks for taking my question. I apologize if I missed this. So, Luke, you mentioned, you know, you kind of saw sequential improvement in pricing as you kind of got through 2025 here. Just wondering how we should think about the cadence of pricing in 2026 as you kind of average out to the mid-5s that's in your guidance there.

Got through our 2025 here just wondering how we should think about the cadence of pricing and in 26 as you know.

The average out to them to the mid fives that starts in your guidance there.

Yeah, Hey, Kevin Great question, you know with the sequential increase that you had coming into the back half of 'twenty five.

Luke Pelosi: Yeah. Hey, Kevin, great question. You know, with the sequential increase that you had coming to the back half of 2025, you end up with a stronger start in absolute numbers in Q1 that then sort of tapers down. So where we're sitting is that Q1 is a sort of mid-six or better number, and then that ratably kind of steps down to a kind of, you know, five-type number by the end of the year. So, you know, one of the benefits that we have in a year of accelerated pricing realized the year before, is the degree of visibility you have into that pricing cadence. I mean, where we sit today, we probably already have 80% of 2026's pricing effectively already in hand, just by virtue of how the sort of math plays out.

And with a.

A stronger start in absolute numbers in Q1 that then sort of tapers down so where we're sitting is that Q1 is a sort of mid six or better number and then that ratably kind of steps down to a kind of five type number by the end of the year. So.

One of the benefits that we have in a year of accelerated pricing realized there before is the degree of visibility you have into that pricing cadence I mean, where we sit today, we probably already at 80%.

2026 as pricing effectively already in hand, just by virtue of how those worried that plays out so feeling really good enterprise number could be a source of upside as we go but it really will be.

Luke Pelosi: So feeling really good on the price number, could be a source of upside as we go, but it really will be starting high in Q1 and then tapering down by Q4.

Starting high in Q1, and then tapering down by Q4.

That's helpful.

Maybe just turning to some of your I guess minority investments.

Kevin Chiang: That's helpful. Maybe just turning to some of your, I guess, minority investments, you know, GIP and Environmental Services. So just wondering how those performed in 25, and what was still kind of a soft, I'll call it, industrial economy. Just, you know, did those businesses exhibit the type of resiliency you saw within your solid waste business, you know, to kind of end out the year the way you anticipated twelve months ago? Just any color you can provide there would be helpful, and thank you.

In environmental services.

How those performed in <unk> and in 'twenty, five and what was still kind of a soft I'll call it industrial economy.

Those businesses exhibit the type of resiliency you saw within your solid waste business to the kind of end of the year. The way you anticipated 12 months ago, just any color you can provide there would be helpful. Thank you.

Yeah.

Yeah, I think if you look at you look at J D.

Business.

You're forecasting sort of five and 125 million of EBITDA for 25 going into the year. When there was a lot of optimism around.

Patrick Dovigi: Yeah, I think if you look at, if you look at the ES business, I mean, you're, you're forecasting sort of CAD 525 million of EBITDA for, for 2025 going into the year, when there was a lot of optimism around, a new president, et cetera. I think with the softness in the industrial economy, et cetera, that business, you know, largely just finished just north of, you know, CAD 500-ish. So there... I mean, it was modestly off from our plan, but not materially off from the plan. I mean, you know, we had pretty robust plans for that business from a sort of a growth perspective.

Our new President et cetera, I think with the softness in the industrial economy et cetera that gives them largely just curious just north of 500 ish.

So I mean, it was modestly off from our plan.

But not materially off from the plan we had.

Pretty robust plans for that business from a sort of a global perspective, and you know on the <unk>.

P side again.

Industrial business, yes, but by and large.

Patrick Dovigi: And, you know, on the GIP side, again, it's an industrial business, yes, but you know, by and large, you know, 75 to 80% of that work is in government contracts and is largely based around transportation sector. So, you know, that hasn't gone away. So that business basically performed to plan. So, you know, exiting, you know, coming into this year, you know, somewhere in the 300-ish million range of EBITDA like we had discussed, and that's sort of still well in hand. You know, if you factor that in, even those two businesses at cost, right? You know, there's, from our perspective, you know, at cost, there's, you know, $5 to $6 a share of value there.

75%, 80% of that work is government contracts and largely based around transportation sector. So.

Isn't gone away, so that business basically performed to plan so.

Exiting exiting.

Coming into this year somewhere in the $300 million range of EBITDA like we've discussed and that sort of still well in hand.

If you factor that in even those two businesses at cost.

Right.

From our perspective cost us five to $6 a share of value there.

Why do we think about opportunistic share buybacks.

Our number one 2026 points of GOP trading at sort of like.

Patrick Dovigi: You know, why we think about opportunistic share buybacks, because, you know, our numbers on 2026 puts GFL trading at sort of you know, in the 12.5x range on 2026 numbers, when you factor in the, the equity value that sits in those two businesses that aren't included in our numbers. And I think that's why we continue to think share buybacks are, you know, very attractive at these levels.

In 12, five times range on 2026 members.

When you factor in the equity value that sits in those two businesses that arent included in our numbers and I think thats why we continue to share buybacks.

Very attractive at these levels.

That's that's very helpful color. Thank you very much.

Thanks Kim.

Trevor Romeo: That's very helpful, Colin. Thank you very much.

Thank you.

Patrick Dovigi: Thanks, Kevin.

Next question comes from Brian <unk> with Citi. You May now proceed.

Operator: Thank you. Our next question comes from Brian Boger here with Citi. You may now proceed.

Hi, good evening, Thanks for taking the question I'm, sorry, if I missed this in the prepared remarks.

Brian Bubes: Hi, good evening. Thanks for taking the question. Sorry if I missed this in the prepared remarks. Did GFL provide Q1 guidance, like I think you did on the Q4 call last year? You know, maybe I missed it or maybe we blame the call operator or maybe you're shifting strategy a tiny bit. Thanks.

<unk> provide <unk> guidance for Q call last year, maybe I missed it or maybe we will end the call operator, or maybe you're shifting strategy at a tiny bit.

Thanks.

Yeah, Hey, Brian as Luke Thanks for the question I think we had some technical difficulties when we're giving them. The very end of the call and maybe that sort of cut out but either way I'll just reiterate what the prepared remarks was what I said was that looking specifically at Q1, we expect revenue of one six to $1 65 billion.

Luke Pelosi: Yeah. Hey, Brian, it's Luke. Thanks for the question. I think we had some technical difficulties when we were giving the very end of the call, and maybe that sort of cut out. But, either way, I'll just reiterate what the prepared remarks was. And what I said was that looking specifically at Q1, we expect revenue of $1.6 to 1.625 billion at approximately 28, 28% margin, which implies 150 basis points expansion over the prior year. Q1 adjusted free cash flow is expected to be negative $45 million, which is less than the prior year, but solely on account of the timing of working capital and CapEx payments.

Approximately 28% to 20% margin, which implies 150 basis points expansion over the prior year Q1, adjusted free cash flow is expected to be negative $45 million, which is less than the prior year, but solely on account of the timing of working capital and Capex payments.

Okay. Okay. Thank you. Thank you very much for that and then just one more question for me just maybe is R&D production.

Brian Bubes: Okay. Okay, thank you. Thank you very much for that. And then just one more question from me. Just maybe as RNG production... I know these products have been pushed out, but just as we are gradually kind of ramping up production, are you finding that your costs are sort of roughly in line with what your initial expectations were from the Investor Day last year, your ongoing production costs, you know, startup costs, just any kind of broader comments there? Thanks. I'll turn it over.

I know these projects been pushed out but just.

As we are gradually kind of ramping up production or are you finding that your costs are sort of roughly in line with what your initial expectations were from the Investor day last year for ongoing production costs jump start up costs.

And you've kind of broader comments there thanks, I'll turn it over.

Yeah, no material change in the actual costs.

I think obviously, we're taking a very careful look at building out you know the larger side.

Patrick Dovigi: Yeah. No material change in the actual costs. You know, I think obviously we're taking a very careful look at, in building out, you know, the larger sites before we're building out some of the smaller ones. So, you know, I think what we've articulated, you know, in the Investor Day presentation, we said it's about CAD 175 million of RNG coming on. You know, our perspective is just depending on, you know, where some of these regulations and volume requirements come in, that we're gonna sort of think about that number sort of being potentially sort of in the CAD 125 to 150 range. That being said, EPR is outperforming, so those two numbers as a whole are gonna be, on plan to our, to our Investor Day presentation.

Before we're building out some of the smaller ones and so I think we've articulated.

And the last presentation, we said, it's about $175 million of LNG coming on.

Our perspective is just depending on.

Whereas some of the regulations and volume requirements come in that we're going to sort of think about that.

That number is sort of being potentially sort of in the 125 to $1 50 range that being said <unk> is outperforming so those two numbers as a whole are going to be.

<unk> plan to our to our Investor day presentation, and Brian just to add to what Patrick said, you know I think the operating costs. Once the plants are up and running are proving to be very much in line with the pro forma <unk>, which included an appropriate degree of conservatism to account for that when we have noticed so some of the start up has slipped a little bit.

Luke Pelosi: Bryan, just to add to what Patrick said, you know, I think the operating costs, once the plants are up and running, are proving to be very much in line with the pro formas, which included an appropriate degree of conservatism to account for that. What we have noticed, though, is some of the startup, you know, has slipped a little bit to the right, so your ramp to achieve that sort of full run rate profitability has already been a quarter or so longer than anticipated. But all the projects that we have up and running are performing in fact, you know, at or above what those sort of underwritten sort of cost profiles were. So I think it's more of the sort of timing issue shifting to the right. And then Patrick said, just ensuring that the overall envelope that we originally identified remains the appropriate level.

To the right. So you ramp to achieve that sort of full run rate profitability as arguably been a quarter or so longer than anticipated, but all the projects that we have up and running are performing in fact at or above what those sort of underwritten sort of cost profiles, where so I think it's more of a sort of tightening issues shifting to the right and then Patrick just ensuring that.

The overall envelope that we originally identified remains the appropriate level, but net net we have presented each yarn RMG as a combined debt and that bridge and we think that combined step remains intact, just maybe a reallocation between the two components therein.

Luke Pelosi: But net, net, we have presented EPR and RNG as a combined step in that bridge, and we think that combined step remains intact. Just maybe a reallocation between the two components therein.

Yeah.

Okay.

Operator: Thank you. Our next question comes from Trevor Romeo with William Blair. You may now proceed.

Oh, yes.

Our next question comes from Sharper Romeo with William Blair You May now please.

Good evening thanks for.

Our questions.

First one I had was kind of a follow up on ETR.

Trevor Romeo: Good evening. Thanks for taking our questions. First one I had was kind of a follow-up on EPR. I guess in terms of some of the provinces that maybe aren't as far along on EPR, how much at this point is still in that kind of future opportunity bucket? I guess, are you still seeing incremental contract awards as a potential upside driver for, you know, this year and beyond? And maybe you could talk about competition for any new contracts that are still out there, if it's gotten tougher to win any of those deals.

I guess in terms of some of the provinces that maybe aren't as far along on EPR. How much at this point is still in that kind of future opportunity bucket. I guess are you still seeing incremental contract awards as a potential upside driver for this year and beyond and maybe you could talk about application for any new contracts that are still out there who've gotten tougher to win any of those.

Yeah.

Yes, I would say.

<unk> through you know I think there are.

Patrick Dovigi: Yeah, and I would say we're largely through. You know, I think there are some collection contracts, you know, still to be let over the next couple of years, but that's, you know, we would put that in a normal course bucket with normal resi wins. But anything material is, you know, we are largely through that now. Alberta was the last province to basically get finalized, and, you know, we ended up splitting the processing for the province of Alberta with Waste Management. So, Waste Management and ourselves have sort of half of the province each. And that was, you know, really the last one that will be let again. So from an opportunity perspective, I think by the end of 2027, you'll have all EPR dollars flowing through the P&L.

Some collection contracts.

Still to be left over the next couple of years, but Thats, we will put out a normal course bucket with normal.

Resi wins.

But anything material as we are largely through that now Alberto was a lot of problems for basically.

Get finalized and we ended up splitting the processing for them for the province of Alberta with waste management. So.

Managing ourselves sort of half of the province each.

When that was large that was.

Really the last one that will be led again and so from an opportunity perspective, I think by the end of 2027, you'll have all Upi.

Flowing through the P&L.

Okay. Thanks, Patrick that's helpful. And then maybe just on your M&A pipeline and kind of I guess the pipeline plus what you bought maybe within the last quarter or so if you could just provide maybe some color on that.

Trevor Romeo: Okay, thanks, Patrick. That's helpful. And then maybe just on your M&A pipeline and kind of, I guess, the pipeline plus what you've bought maybe within the last quarter or so, if you could just provide maybe some color on the, you know, regional or asset perspective, kind of where you saw attractive opportunities, what you'd see in the near term, in terms of your pipeline there.

No regional or asset perspective, kind of where you saw opportunities what you'd see in the near term.

The pipeline there.

Yeah.

Again in Q4, you know people were.

Questioning whether or not we would actually deploy.

Patrick Dovigi: Yeah. I mean, I think we said at the end of Q4, you know, people were questioning whether or not we would actually deploy, if we'd actually deploy the amount of capital that we had in our sort of initial guidance that we'd been articulating through the year, just given the slow start to the year and the fact that we were focused on the divestiture and recapitalization of ES and GIP. You know, we basically deployed close to CAD 1 billion that we said we would. I think when you look at 2026, as we said on Q4, pipeline is, you know, very healthy, a lot of good opportunities.

If we'd actually deployed the amount of capital that we had in our sort of initial guidance or we don't want articulated for the year just given the slow start for the year and the fact that we are focused on the divesture and recapitalization of <unk> and <unk>.

Yeah, we basically redeployed close to 1 billion now we said we would I think when you look at 2026 as we said on Q4.

Pipeline.

As you know very healthy a lot of good opportunities, obviously scale intelligence on a bunch, but.

Again focus on businesses and markets.

Patrick Dovigi: Obviously, still in diligence on a bunch, but you know, again, focused on businesses in markets where we already have existing infrastructure, creating very good synergy opportunities, which will sort of yield higher returns on invested capital versus moving outside and acquiring businesses outside of the existing platform. We're obviously extremely happy with the post-collection network we have throughout, you know, the 10 provinces in Canada and 25 states in the US. So we're gonna continue just driving incremental opportunities on the backs of those facilities, and you know, that's what we're gonna be focused on for 2026. But again, it's gonna be, you know, as we communicated in the, you know, CAD 750 million to CAD 1 billion, as we said in Q4, we think this year could be, you know, even higher than that.

Where we already have existing infrastructure, creating very good synergy opportunities.

Yield higher returns on invested capital versus moving outside and acquiring businesses outside of the cooking platform.

We are obviously extremely happy with the post collection network, we have throughout the.

The 10 provinces in Canada, 25 states in the U S.

So Ryan continue just driving incremental.

Opportunities on the backs of those facilities and that's what we're really focused on for 2006.

But again, it's going to be.

Communicated.

$750 billion to $1 billion as we said in Q4, we think this year it could be even higher than that.

Assuming we continue to make our progress through diligence on some of these assets.

Patrick Dovigi: Assuming we continue to make our progress through diligence on some of these assets, you know, I think we'll have a pretty good update for everybody when we report Q1.

I think we'll have a pretty good update for everybody.

When we report Q1.

Alright, Thank you very much.

Thank you. Thank you.

[Analyst]: All right. Thank you very much.

Patrick Brown: All right. Thank you very much.

Our next question comes from Kannan <unk> with.

Patrick Dovigi: Thank you.

With Scotiabank you May now proceed.

[Analyst]: Thank you. Our next question comes from Konar Gupta with Scotiabank. You may now proceed.

Operator: Thank you. Our next question comes from Konar Gupta with Scotiabank. You may now proceed.

Thanks.

On the M&A.

In terms of the asset quality that you are planning these days in the marketplace I mean, a big chunk of the market has already been consolidated right and.

Konark Gupta: Thanks, just on the M&A follow-up. In terms of the asset quality that you're finding these days in the marketplace, I mean, a big chunk of the market has already been consolidated, right? And, I mean, obviously, there's still a ton of opportunities for you guys, especially given you're smaller than the rest of the three. But any, you know, noticeable differences you're seeing in terms of quality of assets that are coming open to you?

Obviously, there's still a ton of opportunities for you guys, especially given your smaller than the rest of the street.

But any any noticeable differences you're seeing in terms of quality of assets.

I'll come to you.

No I mean I think it's.

Obviously, a year by year.

Can never predict.

Patrick Dovigi: No. I mean, I think, you know, it, it's obviously year by year. You, you can never predict when a specific asset is gonna come to market. But what we know for certain is that the sellers of these businesses aren't getting any younger. And, you know, as people start thinking about succession and liquidity, that's creating opportunity. And, I mean, if you think about the Canadian market, again, you know, the basically Waste Management, Waste Connections, and ourselves represent, you know, call it 40-ish% of the market, so 60% of the market continues to be, you know, wide phase and not consolidated.

On a specific asset is going to come to market.

But what we know for certain is that the salaries businesses aren't getting any younger and let people start thinking about succession and liquidity.

That's creating opportunity and then as you think about.

The Canadian market again.

Basically waste Angela waste connections and installs represents.

Call. It 40 ish percent of the market so 60% of the market continues to be a.

<unk> consolidated and you think about the U S. So you know about 50% of the market is consolidated by the majors in Mexico creates a very good opportunity for all of us.

Patrick Dovigi: And you think about the US, you know, about 50% of the market is consolidated by the majors, and that still creates a very good opportunity for all of us to continue acquiring businesses in the markets where we see opportunities for each of our respective businesses. But the quality of the assets continues to be very high. The quality of the assets that we're looking at within the existing pipeline are very good. And again, we think they'll be great contributors to the sort of overall book, and will yield very good returns on invested capital on the backs of our existing infrastructure. So we're feeling very good about where we sit today, and we're feeling very good about 2026 and beyond in that respect.

When you acquire a business been in the market for.

We see opportunities for each of our respective businesses.

But the quality of the assets continues to be very high.

The quality of the assets that we're looking at within the existing pipeline a very good and again, we think there'll be great contributors to the store.

Overall block and will yield very good the return on invested capital on the backs of our existing infrastructure. So we're feeling very good about where we sit today and we're feeling very good about 'twenty 'twenty six and beyond in that respect and got our just to add to Patrick's commentary you have to remember I mean, the focus of us on tuck in acquisitions into our <unk>.

Luke Pelosi: And Konar, just to add to Patrick's commentary, you have to remember, I mean, the focus of us on tuck-in acquisitions into our existing platform. We can have a scenario whereby we have a great market and a great asset base, and there's a competitor that doesn't necessarily have a gold star asset. But in our hands, with cost takeout opportunities and other synergy, you can turn that into a very high-quality asset. So what's nice about where we're at in our journey is the ability to densify and tuck in some of our best-in-class markets, and thereby take what is perhaps a sub-optimal, little sort of tuck-in on its own, but turn that into something accretive in our hands. That's really what we're focusing on: What can the, this business or asset contribute in our hands?

Existing platform, we can have a scenario whereby we have a great market and a great asset base and there is a competitor that doesn't necessarily.

Goldstar assets, but in our hands with cost take out opportunities and other synergy you can turn that into a very high quality asset. So what's nice about where we're at in our journey is the ability to densify and tuck in some of our best in class markets and thereby take what is.

Perhaps suboptimal little sort of tuck in on its own but turn that into something accretive in our hands and that's really what we're focusing on what can this business where asset contribute in our heads.

Yeah. Thanks for the color on that and if I can follow up.

I think there was some news around the Toronto recycling contract changes that have happened I think there's a change of supplier or your.

Konark Gupta: Yeah, look, thanks for the color on that. And if I can follow up, I think there's some news around the Toronto recycling contract changes that happened. I think there's a change of supplier or your third-party partner there. Any sense in terms of, you know, what potential changes might be required on your side to, you know, deliver on the contract and so on?

Third party partner there.

Any any samsung themselves what potential changes might be required on site to do you know.

Overall the contract in China.

It's not the norm.

Sorry about that.

[Analyst]: ... My calling is now available. Please try again later.

Operator: ... My calling is now available. Please try again later.

Hum.

Good evening.

Uh huh.

Patrick Dovigi: Sorry about that. In terms of EPR, yeah, I mean, we obviously are doing the exact same work we did before, albeit with different service providers. Meaning, you know, our customer used to be the City of Toronto, and now our customer is Circular Materials. That being said, there's been no real change. Yes, there's a little bit of political fallout in the City of Toronto. You know, the fact that we ended up taking on two more districts than we had before, and there was a loss of some union jobs, I think, that led to some media attention by a couple of the, you know, I would say, the more left-leaning papers.

Okay.

We're just going to do it.

Yeah.

Alright, sorry in terms of.

In terms of EPR.

Yeah, well I mean, we obviously are doing the exact same work, we did before albeit with different service providers.

Meaning our customer used to be the city of Toronto an hour.

Or is.

Is circular materials that being said, there's no real change, yes, there's a little bit of political followed in Toronto.

The fact that we ended up doing take it onto a more districts that we had before and there was a loss of <unk>.

Hum Union jobs, I think the leg cause some some media attention by a couple of them.

I would say even more left leaning papers that being said, we started collection in Ontario for over 1 million homes and.

Patrick Dovigi: That being said, you know, we started collection in Ontario for over a million homes, and, you know, collection success was better than 99.3% in the first month of a very large startup. So, overall, very successful. Province continues to be very happy. You know, ultimately, there's a change in collection dates in some of the City of Toronto, which certain residents didn't like or enjoy, but, you know, I think we're largely through that and, you know, now into our second month, and, you know, I think the noise has largely subsided.... Appreciate the time. Thanks.

Collections back.

SaaS was.

Okay.

Better than 99, 3% in the first month of a very large startup so I'm overall.

Overall very successful province continues to be very happy and ultimately there was a change in collection gave some commentary Toronto, which certain resolute.

Like or enjoy but you know I think we're largely through that and yeah now into our second month and you know I think the noise has largely subsided.

Yeah.

I appreciate the time thanks.

Thank you.

Thank you. Our next question comes from William Greene with Barclays. You May now proceed.

Jerry Revich: Thank you.

Operator: Thank you. Our next question comes from William Griffin with Barclays. You may now proceed.

Great. Good evening, thanks, very much for the time most of my questions have already been answered, but just wanted to come back to the update you gave around the GIC any yes I appreciate the color there on the performance I guess.

William Grippin: Great. Good evening. Thanks very much for the time. Most of my questions have already been answered, but just wanted to come back to the update you gave around the GIP and ES. I appreciate the color there on the performance. I guess, just, do you have any updated thoughts on maybe providing some incremental disclosure around those businesses going forward in quarterly releases, just to kind of help, you know, investors and analysts kind of track the performance of those businesses?

Do you have any updated thoughts on maybe providing some incremental disclosure around those businesses going forward and quarterly releases just to kind of help.

Investors and analysts contract the performance of those businesses.

Yeah, well, it's look it's a great question and something I know, we've talked about in person in light of the fact that both of those recapitalization or cargo just happens. We all have this very fresh mark so the cost basis as Patrick referenced roughly close to $3 billion across the two assets today is.

Luke Pelosi: Yeah, Will, it's Luke. It's a great question and something I know we've talked about in person. And, you know, in light of the fact that both of those recapitalization or carve-out just happened, you know, we all have this very fresh mark. So the cost basis, as Patrick referenced, you know, roughly close to $3 billion across the two assets today is pretty sort of fresh. So we didn't include something at this. But absolutely, as we go forward, we're gonna come up with the appropriate level of disclosure such that you guys can have a handle on how those businesses are doing, what the sort of debt level of them are, and what our sort of equity interest is. So you'll have the ability to, you know, calculate that $6 per share math that Patrick was doing. So we will do that.

Pretty sort of fresh so we didn't include something like this but absolutely as we go forward, we're going to come up with the appropriate level of disclosure such that you guys can have a handle on how those businesses are doing but this is where the debt level of them are and what our sort of equity interest is so you'll have the ability to.

Alkylate, that's X dollar per share a map that Patrick was doing so we will do that but as of today. We're just thinking a $1 7 billion cost base and yes, roughly a $1 billion in there.

Luke Pelosi: But as of today, we're just thinking, hey, you got $1.7 billion cost base in ES, roughly $1 billion in the GIP asset, and then I think we value the option on ES at $200 million. So just under $3 billion of value at cost across those two businesses today.

The GIC asset and then I think the value of the option on the asset a couple hundred million Bucks. So just under $3 billion of value at cost across those two businesses today.

That's all for me thanks very much.

Yeah.

Thank you.

William Grippin: All right. That's all for me. Thanks very much.

Our next question comes from Jerry Revich with Wells Fargo. You May now proceed.

Operator: Thank you. Our next question comes from Jerry Revich with Wells Fargo. You may now proceed.

Yes, hi, good evening everyone.

Okay, I wonder as we.

Think about the alright.

Jerry Revich: Yes. Hi. Good evening, everyone. Luke, I wanted to ask you, as we think about the-- Hi, Patrick. I wanted to ask you, as we think about the free cash flow profile of the business, so now that you've got a cleaner portfolio, how should we be thinking about CapEx to sales, you know, beyond 2026? So the core business looks like there's about 11.5% CapEx to sales, and you have the high returns growth CapEx on top of it. As a starting point for 2027 and beyond, how would you counsel us to think about both growth CapEx opportunities as well as just normalized CapEx to sales versus guidance in 2026?

Patrick.

I wanted to ask as we think about the free cash flow profile of the business. So now that you've got a cleaner portfolio.

How should we be thinking about capex to sales.

John.

26, so the core business looks like there's about 11, 5% Capex of sales that you have the high returns on our growth capex of cockpit.

Starting point for 47 and beyond how would you counsel us to think about both growth capex opportunities as well as just normalized capex to sales versus 20.

26.

Yeah. Thanks, Jerry it's a great question and I know in one that's the industry as a widespread it focuses on I think today normal course, Capex you know if I was underwriting them. All it's 11 of 11, 5% number and I think probably 11 five today as we sort of just get through some tariffs et cetera, and maybe that gravitates back down to that normal sort of 11.

Luke Pelosi: Yeah. Thanks, Jerry. It's a great question, and I know one that sort of the industry as a whole sort of focuses on. I think today, normal course CapEx, you know, if I was underwriting a model, it's an 11 to 11.5% number. And I think probably 11.5% today as we sort of just get through some tariffs, et cetera, and maybe that gravitates back down to that normal sort of 11% spend. You know, I would characterize that as the normal course, which is inclusive of maintenance and normal course growth. Obviously, in years where we're gonna be delivering outsized growth, whether it's EPR or similar type of investments, you know, there could be opportunity for spend above and beyond that, and we'll call that out as we have.

Send spend no I would characterize that as the normal course, which is inclusive of maintenance and normal course growth obviously in years, where we're gonna be delivering outsized growth, whether it's <unk> or similar type of investments.

There could be opportunity per spend above and beyond that and we will call that out as we have where we sit today.

As I articulated to the other question I think next year's growth spend as currently contemplated is that meaningfully down from this year's I was really EPR is behind us and you just have to sort of tail end of building out the sort of R&D facilities. So the truth is as we've said since our 2023 capital allocation framework, we've looked at the growth Capex.

Luke Pelosi: Where we sit today, you know, as I articulated to the other question, I think next year's growth spend is currently contemplated to step meaningfully down from this year's, as really EPR is behind us, and you just have the sort of tail end of building out the sort of RNG facilities. So the truth is, as we've said since our 2023 capital allocation framework, we've looked at the growth CapEx similar to M&A, and if we could find more opportunities like RNG and EPR, we would be very inclined to invest in those based on the sort of returns profile. Where we sit today, we don't see anything else on block that is gonna warrant that same carve-out as we've done for EPR and RNG. So we'd expect these just to play off and then roll off, and we'll just be back to a singular CapEx number.

Similar to M&A and if we could find more opportunities like RMG, an ETR, we would be very inclined to invest in those based on the sort of returns profile, where we sit today, we don't see anything else on block that is going to warrant that same carve out as we've done for EPR in R&D. So we do expect these just to play off and then roll off.

It will just be back to a singular capex number, but certainly should by regulation or otherwise, we see opportunities as attractive as these we're going to go after those and we will talk about the appropriate stratification of bifurcation of our capex at that time.

Luke Pelosi: But certainly, should by regulation or otherwise we see opportunities as attractive as these, we're going to go after those, and we'll talk about the appropriate stratification or bifurcation of our CapEx at that time.

Super.

And separately Patrick could I ask you given the strong.

Jerry Revich: Super. And separately, Patrick, can I ask you, given the strong M&A activity over the course of 25, normally we see you folks deliver really good synergies in year two of integration. Can you just talk about for some of the larger deals how those assets are performing and whether we could see a notable tailwind, 26 versus 5 as you integrate those assets?

Our activity over the course of 'twenty five normally see you folks deliver really good synergies.

You are too.

Integration can you just talk about.

For some of the larger deals how those assets are performing and whether we could see.

Notable <unk>.

With 26 five.

<unk> is a unit rate those assets.

Yeah, I mean, there was nothing overly large that sort of happened in 25 that being said you know when we look when we embarked on the M&A pipeline for 'twenty five.

Patrick Dovigi: Yeah. I mean, there was nothing overly large that sort of happened in 2025. That being said, you know, when we look, when we embarked on the M&A pipeline for 2025, we did, just given that we were taking a year and shoving it into basically six months, we really focused on the ones that were most accretive, that were gonna, you know, give us the biggest bang for our buck quickest. And I think that's what gives us a lot of conviction around some of the comments we made in our prepared remarks. You know, I think if you look at the previous 20 quarters, you know, of the business, I think, you know, the previous 20 quarters, we really sort of met or exceeded expectations.

We did just given that we were.

Taking a year and shoving it into basically six months, we really focused on the ones that were most accretive that we're gonna.

Give us the biggest bang for our Buck quite close and I think that's what gives us a lot of conviction around some of the comments we made in our prepared remarks around I think if you look at the.

Previous 20 quarters.

You know of the business I think you know.

20 quarters, we were.

Really sort of met or exceeded expectations.

And you know I think there's multiple levers and multiple avenues for us to continue to exceed expectation in 2026, and a big part of that is you know realizing synergies on some of these opportunities that we closed in late Q3 and early Q4.

Patrick Dovigi: And, you know, I think there's multiple levers and multiple avenues for us to continue to exceed expectation in 2026. And a big part of that is, you know, realizing synergies on some of these opportunities that we closed in late Q3 and early Q4. So you're right, you know, we will continue to deliver on those, and I think those will contribute to, you know, us exceeding expectation for 2026, coupled together with, you know, what we think is a very compelling pipeline for 2026. And we looked at some great updates for you, as we report Q1 and, you know, give some good updates for the balance of the year as we get through the beginning of the year.

So youre right.

We will continue to deliver on those and I think that was a contributor.

<unk>.

US exceeding expectations for 2026, coupled together with what we think is a very compelling pipeline for 'twenty six.

And we love to have some great updates for you.

As we report Q1, and you know give us some good updates for the balance of the year as we as we get through the beginning of the year.

And sorry, Patrick if I may just to put a finer point on that so typically in year. One you worked down by about a turn.

Jerry Revich: Sorry, Patrick, if I may just put a finer point on that. So typically, in year one, you work down by about a turn in terms of synergy relative to the acquisition multiples, what we typically see. So just applying that, given the outsized M&A in 25, it does feel like that's a big chunk of the core EPS growth that you have baked into the numbers, unless I'm missing something about the nature of the deals as normal.

There was a synergy relative to.

The acquisition multiples.

Well you see so just applying that given the outsized M&A and twenty-five it does feel like that's a big chunk of the core EBITDA growth.

Those numbers are.

Yes.

Unless I'm missing something about the nature of the deal.

No Jerry its Luc speaking I think youre, absolutely right. We have demonstrated the outsized margin expansion that we've delivered and enjoyed over the past three or four years.

Luke Pelosi: No, Jerry, it's Luke speaking. I think you're absolutely right. We've demonstrated, you know, the outsized margin expansion that we've delivered and enjoyed over the past three or four years is, you know, a large part of that is being driven by that synergy capture, as you've articulated. So if you think about the 2026 guide, you know, Tyler, on the first question, was trying to parse it out, but even when you peel it all back, you're seeing margin expansion above and beyond what normal course price-cost spread should provide. And a component of that is exactly as you said, that you're realizing the synergy benefit of all that M&A we did in 25, and also, you know, still the tail end of what you did in 2024. So you're absolutely right. Typically, if you're gonna pay...

A large part of that is being driven by that synergy capture as you've articulated. So if you think about the 2026 guide you know Tyler on the first question was trying to parse it out but even when you pull it all back youre seeing margin expansion above and beyond what normal course price cost spread should provide and a component of that is exactly as you said.

Said that you're realizing the synergy benefit of all that M&A, we did in 'twenty five and also so the tail end of what you did in 2024, so you're absolutely right and typically if you're going to pay I think investor day, We said, we pay sort of eight times on the pace of it and then over time can take that cost of ownership multiple down through synergy capture that is.

Luke Pelosi: I think Investor Day, we said we pay sort of 8 times on the face of it, and then, over time, can take that cost of ownership multiple down through synergy capture. That is happening. You saw that in 25, you saw that in 24, and certainly for us to be able to have a 26 guide that shows 60 basis points of margin expansion, including, don't forget, like a 25 basis point plus headwind from commodities, a few other puts and takes, you're actually at an underlying of closer to 100 basis points of margin expansion in 26. Certainly contributing in there is the synergy capture from the acquisitions that you completed in 25 and previously.

Happening you saw that in 25, you saw that in 'twenty, four and certainly for us to be able to have a 26 guide that shows 60 basis points of margin expansion, including don't forget like a 25 basis points plus headwind from commodities a few other puts and takes you actually had an underlying of closer to 100 basis points expansion in 2006 certainly.

Contributing in there is the synergy capture from the acquisitions that you've completed in 25 previously.

Alright, Thank you Frank.

Okay.

Thank you.

Jerry Revich: Thank you, Luke.

Our next question comes from Tobey Sommer with truly now proceed.

Operator: Thank you. Our next question comes from Toby Sommer with Truist. You may now proceed.

Thank you.

Was hoping you could elaborate a little bit more on some of the green shoots that you said you might be seeing with respect to volume in 'twenty six.

Tobey Sommer: Thank you. I was hoping you could elaborate a little bit more on some of the green shoots that you said you might be seeing with respect to volume in 2026, in both the core and perhaps even ES. Thanks.

The core and perhaps even E S.

Yes, so tobey its Luc speaking I was speaking in relation to <unk>.

Luke Pelosi: Yeah. So Toby, it's Luke speaking. I was speaking in relation to GFL when I sort of, you know, spoke to that. I think on the macro side, some of even the indices, whether it's PMI or PPI, are actually sort of starting to turn, you know. I don't know if it's positive or showing some sort of green shoots coming out of that. But it's also just in the sentiment in talking to some of our larger customers as to what their capital plans are for 2026. Very clearly in 2025, people shelved a lot of capital plans, whether it was expansionary or the like, as they were waiting out to see how the world was gonna unfold.

You know spoke to that I think on the macro side, so might be even the indices, whether it's PMI or PPI are actually sort of starting to turn.

Its positive or are showing some sort of green shoots coming out of that but it's also just in a sense of in talking to some of our larger customers as to what their capital plans are for 2026, very clearly in 'twenty five People's shelves, a lot of capital plans, whether it was expansionary or the lake as they were waiting out to see how the world was going to unfold.

I think just having.

<unk> was one of our large customers today. It seems clear that people are figuring out a way to navigate in this period of uncertainty and are going to invest in some of that sort of capital spend that can end up being volume on our side. We also saw on the special waste side, we alluded in the prepared remarks Q4, some surprise special waste.

Luke Pelosi: I think just having conversations with some of our large customers today, it seems clear that people are figuring out a way to navigate in this period of uncertainty, and are going to invest in some of that sort of capital spend that can end up being volume on our side. We also saw, you know, on the special waste side, you know, we alluded in the prepared remarks, Q4, you know, some surprise special waste coming out of activity in some of our markets that wasn't otherwise contemplated. As you know, that's often a leading indicator for activity that then follows on the back of that.

Coming out of activity from some of our markets that wasn't otherwise contemplated as you know that's often a leading indicator for activity that then follows on the back of that so while we would certainly like to see more.

<unk> shoots so before we get too ahead of our skis. It's certainly positive to just see those indicative indicators, suggesting that maybe there is some opportunity on the horizon.

Luke Pelosi: So while we would certainly like to see more, you know, green shoots, so before we get sort of too ahead of our skis, it's certainly positive to just see those indicative indicators suggesting that maybe there's some opportunity on the horizon.

Thank you that's helpful with respect to the.

Moving the headquarters to the U S and inclusion in various indexes could you.

Tobey Sommer: Thank you. That's helpful. With respect to moving the headquarters to the US and inclusion in various indexes, could you maybe give us a little bit of color on timeline, any hurdles or decisions that you have to weigh in order to pursue various inclusions?

Maybe give us a little bit of color on timeline and any.

Any hurdles or or decisions that you have to weigh in order to pursue.

Conclusion.

Yeah, So right out the gate by virtue of the changes that have already occurred we become eligible for the Russell set of sort of indices.

Luke Pelosi: Yeah. So right out the gate, by virtue of the changes that have already occurred, we've become eligible for the Russell set of sort of indices. And the timeline as to that, how that typically works, is mid-spring, I think in April, they'll make an evaluation. And, you know, we believe that we'll check the boxes to be eligible for inclusion, and the actual inclusionary date would happen middle of the year. I think it's in June. And if you look just on the face of it, I mean, the Russell Index inclusion alone could yield somewhere in the mid-single digits of our float, right? So an incremental permanent demand that's sort of gonna come on.

And the timeline to that how that typically works is mid spring I think in April they'll make an evaluation and we believe that will check the boxes to be eligible for inclusion in the actual inclusionary day would have been middle of the year I think its in June and if you look just on the face of it I mean, the Russell index inclusion alone could yield somewhere in the mid single.

Digits of our float right. So an incremental permanent demand that's sort of going to come on by virtue of the steps that we've taken the next step would become the eligibility for other U S. Based indices. The crisps being one that is available to us and we think were eligible and then obviously that S&P sort of 400 500.

Luke Pelosi: By virtue of this step that we've taken, the next step would become the eligibility for other US-based indices, the CRSP being one that is available to us and we think we're eligible, and then obviously the S&P sort of 400/500. Further steps would be required, most notably US GAAP, and, you know, no longer being a foreign private issuer. Steps are underway for us to be eligible, both from a US GAAP conversion as well as to be filing on the domestic forms. And in doing so, you could then open up that incremental index demand. And if you look at, you know, what the index specialists say, there's upwards of another sort of 10 to 15% of volume of our, sorry, float, that could be in demand from that.

Further steps would be rehired, most notably U S GAAP and no longer being a foreign private issuer steps are underway for us to be eligible both from a U S. GAAP conversion as well as to be filing on the domestic forums and in doing. So you can then open up that incremental index demand and if you look at what the index.

Specialists say, there's upwards of another sort of 10% to 15% of volume of our Saudi flow that could be in demand from that if you just look overall as to how much passive demand is in the GFS stock versus our peers, there's a meaningful gap and I think this headquarters announcement.

Luke Pelosi: If you just look overall as to how much passive demand is in the GFL stock versus our peers, there's a meaningful gap, and I think this headquarters announcement, you know, is a first step in starting to close this. So there's significant degree of incremental demand that we think over the short and medium term should come into the name. And we're gonna continue to actively pursue that. As Patrick alluded to in his opening remarks, one of the benefits of the current strategy, thanks to some of the sort of recent changes to the S&P definitions, is none of these changes preclude our eventual inclusion or eligibility, therefore, into the TSX 60, which, as many know, you know, would drive even more incremental passive demand.

As a first step in starting to close this so there's a significant degree of incremental demand that we think over the short and medium term should come into the name.

And we're going to continue to actively pursue that as Patrick alluded to in his opening remarks, one of the benefits of the current strategy. Thanks to some of the sort of recent changes to the S&P definitions is none of these changes preclude our eventual inclusion or eligibility therefore into the <unk> 16, which as many know.

Drive even more incremental passive demand. So we think we have a very nice near and medium and longer term tailwind that should drive a significant incremental permanent demand for a large component of our flow.

Luke Pelosi: So we think we have a very nice near- and medium- and longer-term tailwind that should drive a significant incremental permanent demand for a large component of our flow.

I appreciate the detail thanks.

Stephanie Moore: I appreciate the detail. Thanks, Luke.

Tobey Sommer: I appreciate the detail. Thanks, Luke.

Thank you. Our next question comes from James Kahn, with Chile, counting you May now please.

Operator: Thank you. Our next question comes from Jim Skull with TD Cowen. You may now proceed.

Hey, guys. Thanks for taking my questions. So look just a clarification.

Jim Skur: Hey, guys, thanks for taking my questions. So, Luke, just a clarification on the pricing. I think so pricing was 6.4% in the fourth quarter. I think you said Q1, your mid-fours or, you know, in the sixes. So, and I think you said you're, you know, largely 80% contracted through the year as of Q1 or something like that. So help me understand. I mean, I know that, I know that pricing will bleed lower just the math of it throughout the year, but, like, how do you get to mid-fives from, you know, six-four or solidly in the sixes?

Vacation on the pricing I think so pricing was six 4% in the fourth quarter. I think you said Q1, your mid fours or you know in the sixes, so and and I think you said, you're largely 80% contracted.

Through the year as of Q1 or something like that so help me understand I mean, I know that I know that pricing will bleed lower.

Just the math of it throughout the year, but like how do you get to mid fives from.

Six four are solidly in the sixes.

Yeah, Hey, Jim Thanks for thanks for the question. It's a good one I know, sometimes the pricing math and get a little confusing, but it's really a function of the quarter over the prior year quarter and during a period of ramping pricing during the year, you've effectively the pricing actions I did in each 225 I know.

Luke Pelosi: Yeah. Hey, Jim, thanks, thanks for the question. It's a good one. I know sometimes the pricing math can get a little confusing, but it's really a function of, you know, the quarter over the prior year quarter. And during a period of ramping pricing during the year, you've effectively... The pricing actions I did in Q2 2025, I now have certainty of those rolling over into Q1 2026, and it therefore just gives me a high degree of certainty of the actual dollars of price that will be realized in each of these quarters.

Certainty of those rolling over into each one of 2006 and therefore it just gives me a high degree of certainty the actual dollars of price that would be realized in each of these quarters. So if you think about a Q1 number being in sort of mid sixes and if that then steps down and forgive me I don't have the rest of the quarterly cadence in front of me I think of that then.

Luke Pelosi: So if you think about a Q1 number being in a sort of mid-sixes, and if that then steps down, and forgive me, I don't have the rest of the quarterly cadence in front of me, but think of that then stepping down to the high fives, that then steps down to the low fives, that then steps down to five. That's how you're gonna blend to a number in the sort of mid-fives. So that's the sort of rough cadence of it. That is absent any incremental pricing actions that sort of get taken through the year. And as I said, you know, we think, we hope that we're able to actually do sort of slightly better than that, right?

Stepping down to the high fives that then steps down to the low fives that then steps down to five that's how you're going to blend into a number and that sort of mid fives. So that's the sort of rough cadence of it.

That is absent any incremental pricing actions that sort of get taken through the year and as I said you know we think we hope that we're able to actually do sort of slightly better than that right. The pricing you ultimately realize is a function of stick right and so when you do pricing actions.

Luke Pelosi: The pricing you ultimately realize is a function of stick rate, and so when you do pricing actions, you sometimes have rollbacks that you need to do to establish the sort of firm level pricing. Obviously, the full extent of those aren't known to us today. We're taking an estimate based on our past experience, but that is the basis on which, you know, the math would yield that sort of mid-fives number.

In times of Rollbacks that you need to do to establish the soda firm level pricing and obviously the full extent of those arent known to US today, we're taken estimate based on our past experience, but that is the basis on which the math would yield that sort of mid fives number.

Okay, Great and then my last one you basically just touch on it but.

Jim Skur: Okay, great. And then, my last one, you basically just touched on it, but, in the prior question. But given that FX is moving your financials and your guidance around quite a bit, like, I was gonna ask, do you have plans to report in US dollars? It sounds like, it sounds like you said maybe you've got something in the works, but, what would be the timing on that?

And then in the prior question.

But given that FX is moving your financials and your guidance around quite a bit like <unk>.

I was going to ask do you have plans to report in U S dollars it sounds like.

It sounds like you said, maybe you've got something in the works, but but what would be the timing on that.

Yes, it's a great question and something that we think a lot about because today FX moves against us as a benefit for our peers, what they're moving in opposite directions, and I think just adds incremental complexity to the comparability. So I think the eventual outcome is that we convert to being a U S. GAAP reporter again eliminating.

Luke Pelosi: Yeah, it's a great question and something that we think a lot about, because today, FX moves against us is a benefit for our peers, so we're sort of moving in opposite directions, and I think it just adds incremental complexity to the comparability. So I think the eventual outcome is that we convert to being a US GAAP reporter. Again, eliminating, you know, divergence in reporting between us and our peers. And, you know, you could evaluate being a US dollar-denominated sort of reporter as well. I mean, more and more, our business has grown in the US. However, we still have a very sizable business in Canada, and, you know, the sort of back-end, infrastructure and shared services is all based there. So we'll continue to evaluate.

Diversion in reporting between us and our peers.

And you could evaluate being a U S dollar denominated as sort of a quarter as well I mean, more and more our business has grown in the US However, we still have a very sizable business in Canada, and you know the sort of back end infrastructure and shared services as all base. There. So we'll continue to evaluate I think though if you were to make it.

Change to be a U S. GAAP filer it may make sense at that time that you also went through a U S. Dollar currency just to fully align comparability amongst the sort of peer group.

Luke Pelosi: I think, though, you know, if you were to make a change to be a US GAAP filer, it may make sense at that time that you also went to a US dollar currency, just to fully align comparability among the sort of peer group. The timing for that, Jim, I'd tell you, is, you know, as I was speaking about the Russell, we think there's a path where you be a sort of Russell inclusion midway through this year. The next big inclusions would require a US GAAP conversion, and I think we intend to be ready to do that as early as 1 January 2027. Now, whether or not we actually sort of go forward at that date or you wait till the end of the year is still sort of TBD, but it's not gonna happen in 2026.

<unk> for that Jim as I as you know.

Speaking about the Russell, we think there's a path where you can sort of Russell inclusion midway through this year. The next big conclusions would require a U S. GAAP conversion and I think we intend to be ready to do that as early as Jan one 2027, now whether or not we actually sort of go forward at that date or you wait for that ended the year is still sort of TBD, but it's.

Not going to happen in 'twenty six.

But we're certainly taking the steps in preparation now to be ready to do that.

Luke Pelosi: But, you know, we're certainly taking the steps in preparation now to be ready to do that, you know, sometime in the future. I could see a potential outcome that you do it at the end of 2027, you know, in advance of 2028, but certainly we're exploring all options.

Sometime in the future I could see a potential outcome you do it at the end of 2027 in advance of 2028, but certainly we're exploring all options.

Okay, great. Thanks, Luke I appreciate it.

Thank you.

Jim Skur: Okay, great. Thanks, Luke. Appreciate it.

Our next question comes from Stephanie Meyer with Jefferies. You May now proceed.

Operator: Thank you. Our next question comes from Stephanie Moore with Jefferies. You may now proceed.

Great. Good evening, thanks, guys.

You know look I just wanted to follow up on a question maybe a quick question about we are talking about the the outsized margin expansion this year outside of price Brad you know.

Stephanie Moore: Great. Good evening. Thanks, guys. You know, look, I just wanted to follow up on a question maybe two or three questions ago, where you were talking about the outsized margin expansion this year outside of price-cost spread. You know, I think, Luke, you did a really good job at the analyst day of outlining kind of all the self-help initiatives, you know, and third pricing, automation, and the like, that you expect over the next couple of years. Can you maybe give us an update on how those are trending? You know, what we should be thinking about in 2026 that's really moving the needle?

I think Luke you did a really good job at the analyst day at outlining kind of all the self help initiatives in ancillary pricing automation and the like.

They expect to have the back couple of years can you maybe give us an update on how those are trending and what we should be thinking about it quite funny, that's really it.

Moving the needle.

As a follow up that if.

If we can expect to see a more outsized M&A.

Stephanie Moore: I guess as a follow-up to that, you know, if we do expect to see a more outsized M&A, you know, this year or next year, do some of these investments help make those integrations and synergy captures that, that much more effective?

This year or next year, if some of these investments.

Help make those integration.

Or is that much more effective.

Right.

Yes, Thanks, Stephanie it's a great question.

Now as we look back on the Investor day presentation, and our outperformance in 2025.

Luke Pelosi: ... Yeah, thanks, Stephanie. It's a great question. You know, something that as we look back on the Investor Day presentation and our outperformance in 2025, you know, gives us even further conviction in our ability to realize those financial benefits from the self-help levers that we articulated based on how successful we were in 25. Look, if you begin with the levers, let's start with the pricing. I mean, obviously, we started 25 in an expectation of low to mid-5s pricing, ended the year at 6.1, you know, nearly 70 bits above performance. You know, a big part of that was the realization of those sort of ancillary surcharge program, as we had sort of anticipated. I think we articulated a $40 to 80 million prize there.

It gives us even further conviction in our ability to realize those financial benefits from the self help levers that we articulated based on how successful we are in 25, but if you think where the leverage will start one starting with the pricing I mean, obviously, we started 25 years and expectation of low to mid fives pricing ended the year at six one nearly 70 bps about performance.

A big part of that was the realization of those sort of ancillary surcharge program as we had sort of anticipated I think we articulated a $40 million to $80 million Prize. There you know taking that if this were the midpoint.

Roughly the 60 million dollar amount that I mean, I think we're set up and on pace to recognize that ratably over the four year period, arguably a little front end loaded as we've demonstrated 25 and you know as I said in the prepared remarks pricing for 2026 estimate and that sort of mid fives range and any further.

Luke Pelosi: You know, taking that at the sort of midpoint, you know, roughly the $60 million amount that, I mean, I think we're set up and on pace to recognize, you know, that ratably over the four-year period, arguably a little front-end loaded, as we've demonstrated in 25. And, you know, as I said in the prepared remarks, pricing for 2026 estimated in the sort of mid-fives range, and any, you know, further accelerated implementation of the ancillary surcharges could give upside to that number. So we're feeling really good on that aspect or that sort of self-help lever. When you start getting into the middle, and the next one was employee turnover. We said, as we, you know, reduce this employee turnover, we're gonna realize the benefit of the efficiency, the cost of risk, the onboarding, and the productivity associated with that.

Further accelerated implementation of ancillary surcharges could give upside to that number so we're feeling really good on.

On that aspect or that sort of self help lever when you start getting into the middle of the next one was employee turnover, we said as we reduce employee turnover, we're going to realize the benefit of the efficiency the cost of risk the onboarding and the productivity is says with that and I think youre seeing that as well I mean across the cost category lines. This year from <unk>.

Luke Pelosi: And I think you're seeing that as well. I mean, across the cost category lines this year, from direct labor costs to R&M expense to SG&A, you're seeing the operating leverage come, and part of that is that, you know, improved labor turnover. We got to high teens in 2025. We see more room for improvement in 2026 and 2027, and certainly those benefits are accruing to, to the bottom line. The next, the fleet, conversion and CNG piece, I believe, is the next lever. I mean, I think when we started this, we had a sort of mid- to high-teens percentage of our fleet being CNG. You know, we brought that up to mid-20s, and we're now on top to sort of be at, you know, close to 30%, and certainly seeing the benefits of that coming through in the results as well.

Correct labor cost the R&M expense to SG&A youre seeing the operating leverage come and part of that is that improved labor turnover, we got the high teens and 25, we see more room for improvement in 'twenty six 'twenty seven and certainly those benefits are accruing to the to the bottom line. The next the fleet conversion in <unk>.

<unk> I believe is the next lever I mean, I think when we started this we had a sort of mid to high teens percentage of our fleet being CMG, we brought that up to mid twenties, where now on advances would it be close to 30% and certainly seeing the benefits of that coming through in the results as well so feel really good with the ratable realization of that.

That benefit or that price that was articulated on that side and the last one was just a sort of general procurement and overall sort of efficiency in the middle and I think youre seeing that as well so.

Luke Pelosi: So feel really good with the ratable realization of that benefit or that prize that was articulated on that side. And the last one was just the sort of general procurement and overall sort of efficiency, you know, in the middle. And I think you're seeing that as well. So, you know, you peel it all back, what gives us, you know, a great sense of optimism is we're not relying on any one of those levers to drive outsized performance. It's in fact, the combination of each of them in small, little ways, but all adding up to, you know, this differentiated margin expansion that you're seeing in our business versus ours. So 2026, we're excited to, you know, continue to deliver.

The appeal it all back what gives us a great sense of optimism and we're not relying on any one of those levers to drive outsized performance. It's in fact, the combination of each of them and small little ways, but all adding up to this differentiated margin expansion that youre seeing in our business versus ours. So 26, we're excited.

To continue to deliver a you know as we said we see.

Avenues of upside on the guide and certainly out of continued outperformance in those levers will be sort of part of that 'twenty.

Luke Pelosi: You know, as we said, we see avenues of upside on the guide, and certainly continued outperformance in those levers will be sort of part of that. 25 was a great starting year, and, you know, we hope to be able to continue the trend.

25 was a great starting here and we hope to continue the trend.

Thanks, guys I appreciate it.

[Analyst]: Thanks, guys. Appreciate it. Thank you. Our next question comes from Adam Bubes with Goldman Sachs. You may now proceed.

Stephanie Moore: Thanks, guys. Appreciate it.

Thank you.

Operator: Thank you. Our next question comes from Adam Bubes with Goldman Sachs. You may now proceed.

Our next question comes from.

And boots with Goldman Sachs You May now proceed.

Hi, good evening.

Patrick you talked about potential for an outsized year of M&A, just how far above the $1 billion annual target would you be comfortable going I mean, just back of the envelope math I think every $500 million of incremental M&A only ads.

Adam Bubes: Hi, good evening. Patrick, you talked about potential for an outsized year of M&A. Just how far above the CAD 1 billion annual target would you be comfortable going? I mean, just back of the envelope math, I think every CAD 500 million of incremental M&A only adds 0.1 or 0.2 to leverage.

0.1 0.2 to leverage.

Yeah, I think I think.

We think where we sit today you could easily spend 1 billion and a half to $2 billion I think temporarily.

Patrick Dovigi: Yeah, I think, you know, I think, you know, you know, we think where we sit today, we could easily spend $1.5 to 2 billion. I think temporarily, you know, leverage might be sort of in the 3.75 to 3.8 range intraquarter, but then you still exit the year in the mid-3s. So I think that's where I think you sort of peak out before you need some form of equity. And I think, you know, going back to... I think we've telegraphed, you know, in Q4 and sort of late Q3, was that we, you know, we think that this year could be. That being said, you know, we're still going to go through all these opportunities and nothing's for certain. But yeah, your math is right.

Leverage might be sort of in the $3 75 to three eight range intra quarter, but then you still exit the year in the mid threes.

So I think.

That's rising as you sort of peak out before you would need.

Some form of equity and I think you know going back to I think we've telegraphed.

In Q4 and sort of late Q3 without.

Sure Amit.

Said.

Some of those are always opportunities and nothing for certain but yeah. Your math is right obviously, depending on what the purchase prices for you are buying that sort of in that range are correct and I think.

Patrick Dovigi: Obviously, depending on what the purchase price is for your buying, but, but in that range, you're correct. And I think, you know, that you would still end up in the low to mid threes, even deploying that amount of capital.

That you would still end up in the low to mid threes.

We've been deploying that amount of capital.

And then I think you said.

After 2026 margin guidance and there's a 100 basis points of underlying margin expansion 25 basis point headwind for commodities what are some of the other puts and takes that get you to 60 basis points and then can you just help us think through the cadence of going from a 150 basis points year over year.

Adam Bubes: And then, Luke, I think you said, for 2026 margin guidance, there's 100 basis points of underlying margin expansion, 25 basis point headwind for commodities. What are some of the other puts and takes that get you to 60 basis points? And then can you just help us think through the cadence of going from 150 basis points year over year? And it, I think guidance obviously embeds decelerating margin expansion throughout the year.

I think guidance, obviously, embeds decelerating margin expansion throughout the year.

Yeah, Great. Great question, if you think about 60 basis points margin expansion on the headline number included there and you got a 25 basis point headwind from commodities.

Luke Pelosi: Yeah, Adam, great, great, question. If you think about 60 basis points margin expansion on the headline number, you know, included therein, you got a 25 basis point headwind from commodities. You got 5 basis point headwind from the Q1 year-over-year comp on that hurricane volume that I alluded to. Again, you know, we always hope there is no natural disasters, but in 2025, we enjoyed excess volume, you know, at a high margin. So backing that out is under 5 bps. I think you have about a 10 basis point, headwind from FX and from the carbon credits that you realized in 2025. So when you, you think about the 60 basis point headline number, backing out those amounts, you know, it yields about a 100 basis points sort of underlying piece overall.

Five basis point headwind from the Q1 year over year comp on that hurricane volume that I alluded to again, Oh, we always hope there is no natural disasters in 2025 enjoyed excess volume at a high margins. So back notes under five bps I think of about a 10 basis point headwind from FX and from the carbon credits that you realize.

25.

Do you think about the 60 basis point headline number.

Backing out those amounts yields about 100 basis points sort of underlying piece overall, when you think about the cadence Q1.

The 150 basis point B B based on the guide year over year Q2 of last year, you enjoyed an exceptional margin performance and so actually say you know contemplate ethane flat to a little backwards in Q2, and then Q3 and Q4 modestly ahead I think what Youre seeing is as the <unk>.

Luke Pelosi: When you think about the cadence Q1, you know, as I said, the 150 basis point beat based on the guide year-over-year. Q2 of last year, you know, you enjoyed an exceptional sort of margin performance, and so we're actually, you know, contemplating, I think, flat to a little backwards in Q2, and then Q3 and Q4, you know, modestly ahead. I think what you're seeing is, as the business matures and our geography expands in the south, you're seeing a bit of a flattening of that sort of seasonality. So as opposed to the peaks and valleys from Q1 to Q3 that we historically had, you're seeing a bit of a sort of flattening of that year-over-year, and we expect sort of more of the same.

Business matures and geography, expanding the so you're seeing a bit of a flattening of that sort of seasonality. So as opposed to the peaks and valleys from Q1 to Q3, though historically had youre seeing a bit of a sort of flattening of that year over year, and we expect sort of more of the same but that's the basis for the expectation of the cadence throughout the year.

You also have added them or call the commodity com will bigger drag in the first half of the year and then that steps down as you go as you go throughout the year. So the underlying will have less adjustments to achieve by the time you get to Q4, if commodity prices stay where they are today.

Luke Pelosi: But that's the basis for the, you know, expectation of the cadence throughout the year. You also have, Adam, recall, the commodity comp will, you know, bigger drag in the first half of the year, and then that steps down as you go throughout the year. So the underlying will have less adjustments to achieve by the time you get to Q4, if commodity prices stay where they are today.

Great. Thanks, so much.

Thank you.

[Analyst]: Great. Thanks so much.

Adam Bubes: Great. Thanks so much.

Next question comes from IHS that Spencer you May now proceed.

Operator: Thank you. Our last question comes from Adit Shrestha with Seifel. You may now proceed.

Alright, thanks for taking my questions.

Just a quick one in terms of the reported volume of 50 bps for 2025, how much of that was from a pure R&D ramping up.

Adit Shrestha: Hi, thanks for taking my questions. Just a quick one. In terms of the reported volume of 50 bps for 2025, how much of that was from EPR and RNG ramping up?

Orangey had a de minimis component to the overall thing because R&D is much lesser revenue story for us and it is there's a little bit in there from R&D ramping up but it's not a sort of a significant component of that.

Luke Pelosi: RNG had a de minimis component to the overall thing, because RNG is much less a revenue story for us than it is. There's a little bit in there from RNG ramping up, but that's not a sort of significant component of that. I think when you look at EPR and you look at our Canada-wide sort of volume, you know, I think the numbers we would have reported was, you know, EPR was about $10 million in Q1, roughly $20 million of each of Q2 and Q3. And then as you had lapped the Q4, it was de minimis. I think it was like sort of $5 or 7 million in Q4. So you certainly got some outsized contribution from that.

When you look at ETR and you looked at our Canada wide sort of volume I think the numbers that we would've reported was EPR was about $10 million in Q1, roughly $20 million of each of Q2 and Q3.

And then as you lap the Q4 it was de Minimis I think it was like sort of five or $7 million in Q4. So you certainly got some.

<unk> contribution from that where we can take comfort is even when you strip that out when you think about.

Luke Pelosi: Where we take comfort is even when you strip that out, when you think about, you know, some of that hurricane volume that are comping, you know, year over year, you're still, you know, I think, at an industry leading sort of volume print. Again, just going back to some of our market selection, where, you know, we enjoy volumetric growth is based on the macro that's happening in central Florida, Georgia, and, you know, some of our Texas markets. That helps sort of offset some of the C&D related exposure.

Some of that hurricane volume, they're comping year over year, you are still I think he had an industry leading sort of volume print.

Then just going back to some of our market selection, where we enjoy volumetric growth just based on the macro that's happening in Central Florida, Georgia, and you know some of our Texas markets that help sort of offset some of the CND related exposure.

Thank you and just in terms of a good guide for volume for next year.

Adit Shrestha: Thank you. Just in terms of your guide for volume for next year, what are you sort of, kind of, building into your guide in terms of recovery signs? Because you mentioned some green shoots that you're seeing. So are you trying to, you know, are you thinking of building in some physical volumes in there or anything like that? Or is it really what you're seeing right now?

What are you sort of kind of bill.

Building into your guidance in terms of recovery because you mentioned some green shoots that you're seeing some of them are returning.

Think of them building a considerable volumes in there or anything like that or is it really with what youre seeing right now.

No. Our guide is based on the environment that we see today. So we're just assuming sort of status quo.

Luke Pelosi: No, our guide is based on the environment that we see today, so we just assume sort of status quo. You know, the green shoot sort of commentary was more, you know, as I was alluding to some of these conversations and touch points we've had with our customers. Look, January is going to be a tough volume month right out the gate, just because when you think about the amount of snow that's come and blanketed Wisconsin, Michigan, you know, Toronto, these are markets that are used to snow, but this has been, an exceptional level of snow. So I think you've got a pretty tough start to the year in January.

The green shoots where the commentary was more as always learned into somebody's conversation and touch points with them with our customers look January is gonna be a tough volume monthly that the gauge is because when you think about the amount of snow that's common blanketed, Wisconsin, Michigan. Toronto. These are markets that are used to snow, but this has been an exceptional level. So so I think you've got a pretty tough start to the year in January.

But again, it's just sort of structurally some of the contracts, we won ETR coming online and the like that gives us confidence about the print a slightly positive number certainly any recovery as we think about our C&D volumes or just broader macroeconomic activity could provide a tailwind above and beyond but that would all be additive.

Luke Pelosi: But again, it's just sort of structurally, some of the contracts we've won, EPR coming online and the like, that gives us sort of confidence to be able to print, you know, a slightly positive number. Certainly, any recovery, as we think about our C&D volumes or just broader macroeconomic activity, could provide a tailwind above and beyond, but that would all be additive. We're just assuming status quo with the current sort of macro environment.

We're just assuming status quo with the current macro environment.

Yeah.

Great. Thanks for taking my question.

Thank you so much.

Adit Shrestha: Great. Thanks for taking my question.

Thank you.

Patrick Dovigi: Thank you so much.

At this time I would now like to pass the conference back over to Patrick <unk> for any closing remarks.

Operator: Thank you. At this time, I would now like to pass the conference back over to Patrick Dovigi for any closing remarks.

Thank you everyone for joining much appreciate it and look forward to catching up when we report Q1. Thank you.

Patrick Dovigi: Thank you everyone for joining. Much appreciated. Look forward to catching up, when we report Q1. Thank you.

That concludes today's conference call. Thank you for your participation you may now disconnect your lines.

Operator: That concludes today's conference call. Thank you for your participation. You may now disconnect your line.

Q4 2025 GFL Environmental Inc Earnings Call

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