Waste Management 2007 Annual Report Download - page 13

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In 2007, Waste Management continued to deliver strong financial performance. We expanded our
operating margins and increased earnings per share. We lowered our operating costs for the second
consecutive year. Our return on invested capital grew. The company generated strong free cash flow
and returned $1.9 billion to its shareholders through share repurchases and dividends.
Showing confidence in the company's ability to consistently deliver strong cash flow, our Board of
Directors announced that they expect an increase of 12.5 percent for quarterly dividends in 2008,
from $0.96 to $1.08 per share on an annual basis. Based on the share price at the close of fiscal 2007,
the expected dividend equates to an annual yield of 3.3 percent. The yield on this dividend keeps
Waste Management in the top 20 percent of companies on Standard & Poor's 500 Index.
Maintaining financial strength is one way that we create value for our shareholders. Keeping this
foundation strong enables us to fund the operating and capital needs of our business, as well as
providing a good return to shareholders. It is the result of doing things right on a multitude of fronts.
In 2007, we continued to work on ensuring that the prices we charge reflect the value of the
services we provide. Following our initial focus on the commercial collection business, in 2007 we
implemented the program for other areas, including landfills, transfer stations, Wheelabrator, and WM
Recycle America. As expected, the process of evaluation and adjustment resulted in some loss of less
profitable business, and we achieved an overall improvement in margins and earnings.
11
A strong financial foundation is fundamental to our
company’s success. Through the years, we have worked to
maintain consistently high levels of free cash flow that
signify continuing strength at the core.
DOING WHAT COUNTS
For Our Shareholders