Waste Management 2007 Annual Report Download - page 143

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The following table summarizes the unaudited quarterly results of operations for 2007 and 2006 (in millions,
except per share amounts):
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
2007
Operating revenues ............................... $3,188 $3,358 $3,403 $3,361
Income from operations(a), (b), (c), (d), (e), (f) .......... 481 633 565 575
Net income(g), (h), (i). . ........................... 238 338 278 309
Income per common share:
Basic:
Net income(g), (h), (i) ......................... 0.45 0.65 0.54 0.61
Diluted:
Net income(g), (h), (i) ......................... 0.45 0.64 0.54 0.61
2006
Operating revenues ............................... $3,229 $3,410 $3,441 $3,283
Income from operations(j), (k)....................... 435 565 557 472
Net income(i), (l), (m) . ........................... 186 417 300 246
Income per common share:
Basic:
Net income(i), (l), (m) ......................... 0.34 0.77 0.56 0.46
Diluted:
Net income(i), (l), (m) ......................... 0.34 0.76 0.55 0.46
(a) In the second and fourth quarters of 2007, “(Income) expense from divestitures, asset impairments and unusual
items” increased our income from operations by $33 million and $14 million, respectively. These benefits are
due to gains from divestitures as a result of our fix-or-seek exit initiative. Gains recognized during the second
quarter of 2007 were partially offset by impairment charges required for two landfills in our Southern Group.
(b) Our “Income from operations” for the first and third quarters of 2007, was improved by $15 million and
$3 million, respectively, due to the favorable resolution of a disposal tax matter in our Eastern Group, which has
been recognized as reductions to disposal fees and taxes within our “Operating” expenses.
(c) Our “Income from operations” for the first quarter of 2007 was negatively affected by approximately
$21 million of charges incurred for the early termination of a lease agreement in connection with the purchase
of one of our independent power production plants. This charge was recorded as “Operating” expenses.
(d) During the fourth quarter of 2007, our “Income from operations” was positively affected by a $17 million
reduction in landfill amortization expenses associated with changes in our expectations for the timing and cost
of future final capping, closure and post-closure of fully utilized airspace.
(e) During the third and fourth quarters of 2007, our “Income from operations” was negatively affected by
$26 million and $8 million, respectively, principally for increased “Operating” expenses, due to a labor dispute
in Oakland, California and, to a much lesser extent, the management of labor disputes and collective bargaining
agreements in other parts of California. Costs incurred were largely related to security efforts and the
deployment and lodging costs incurred for replacement workers who were brought to Oakland from across
the organization.
(f) Certain operations and functions were restructured resulting in the recognition of pre-tax charges of $9 million
and $1 million, for the first and second quarters of 2007, respectively. These charges were primarily related to
employee severance and benefit costs. Refer to Note 11 for additional information.
108
WASTE MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)