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Waste Connections Reports Second Quarter 2008 Results

- Reports revenue of $267.0 million, up 10.8%, and earnings per share of $0.39

- Reports pricing growth of 5.4% and internal growth of 4.6%

- Reports YTD free cash flow of $79.2 million, or 15.3% of revenue, up 54.0%

- Increases available capital to fund potential acquisition activity

PRNewswire-FirstCall
FOLSOM, Calif.
Jul 22, 2008

Waste Connections, Inc. today announced its results for the second quarter 2008. Revenue totaled $267.0 million, a 10.8% increase over revenue of $241.1 million in the year ago period. Operating income was $55.6 million versus $53.8 million in the second quarter of 2007. Net income in the quarter was $26.2 million, or $0.39 per share on a diluted basis of 67.8 million shares. In the year ago period, the Company reported net income of $25.3 million and diluted earnings per share of $0.36. Non-cash costs for equity-based compensation and amortization of acquisition-related intangibles were $3.3 million ($2.0 million net of taxes, or approximately $0.03 per share) in the quarter compared to $2.5 million ($1.5 million net of taxes, or approximately $0.02 per share) in the year ago period.

"We remain extremely pleased with our performance in the year considering the rapid escalation in fuel costs and weakening economic environment. A 55% year-over-year increase in average fuel prices drove an approximate $8 million increase in fuel expense in the quarter and resulted in fuel costs as a percentage of revenue increasing approximately 285 basis points, or 50 basis points ($1.3 million) above expectations for the quarter. Fortunately, continuing pricing strength and operating improvements enabled us to recover most of the dollar impact of this unprecedented increase," said Ronald J. Mittelstaedt, Chairman and Chief Executive Officer. "Our strong free cash flow, expansion of our credit facility and recently executed private note placement agreement position us to fund a potential increase in acquisition activity later in the year, with access to additional capital if necessary."

For the six months ended June 30, 2008, revenue was $517.3 million, a 12.5% increase over revenue of $460.0 million in the year ago period. Operating income was $106.4 million versus $100.2 million for the same period in 2007. Net income for the six months ended June 30, 2008, was $49.4 million, or $0.73 per share on a diluted basis of 68.0 million shares. In the year ago period, the Company reported net income of $47.6 million, or $0.67 per share on a diluted basis of 70.6 million shares. Non-cash costs for equity-based compensation and amortization of acquisition-related intangibles for the six months ended June 30, 2008, were $6.8 million ($4.1 million net of taxes, or approximately $0.06 per share) compared to $5.2 million ($3.2 million net of taxes, or approximately $0.04 per share) in the year ago period.

Waste Connections will be hosting a conference call related to second quarter earnings and third quarter outlook on July 23rd at 8:30 A.M. Eastern Time. The call will be broadcast live over the Internet at http://www.streetevents.com/ and through a link on the Company's web site at http://www.wasteconnections.com/. A playback of the call will be available at both of these sites.

For non-GAAP measures, see accompanying Non-GAAP Reconciliation Schedule.

Waste Connections, Inc. is an integrated solid waste services company that provides solid waste collection, transfer, disposal and recycling services in mostly secondary markets in the Western and Southern U.S. The Company serves more than one million residential, commercial and industrial customers from a network of operations in 23 states. The Company also provides intermodal services for the movement of containers in the Pacific Northwest. Waste Connections, Inc. was founded in September 1997 and is headquartered in Folsom, California.

For more information, visit the Waste Connections web site at http://www.wasteconnections.com/. Copies of financial literature, including this release, are available on the Waste Connections web site or through contacting us directly at (916) 608-8200.

Certain statements contained in this press release are forward-looking in nature. These statements can be identified by the use of forward-looking terminology such as "believes," "expects," "may," "will," "should," or "anticipates," or the negative thereof or comparable terminology, or by discussions of strategy. Waste Connections' business and operations are subject to a variety of risks and uncertainties and, consequently, actual results may differ materially from those projected by any forward-looking statements. Factors that could cause actual results to differ from those projected include, but are not limited to, the following: (1) Waste Connections may be unable to compete effectively with larger and better capitalized companies and governmental service providers; (2) increases in the price of fuel may adversely affect Waste Connections' business and reduce its operating margins; (3) increases in labor and disposal and related transportation costs could impact Waste Connections' financial results; (4) increases in insurance costs and the amount that Waste Connections self-insures for various risks could reduce its operating margins and reported earnings; (5) Waste Connections depends significantly on the services of the members of its senior, regional and district management team, and the departure of any of those persons could cause its operating results to suffer; (6) Waste Connections' financial results are based upon estimates and assumptions that may differ from actual results; (7) efforts by labor unions could divert management attention and adversely affect operating results; (8) Waste Connections' results are vulnerable to economic conditions and seasonal factors affecting the regions in which it operates; (9) Waste Connections may lose contracts through competitive bidding, early termination or governmental action; (10) Waste Connections may be subject in the normal course of business to judicial and administrative proceedings that could interrupt its operations, require expensive remediation, result in adverse judgments or settlements and create negative publicity; (11) competition for acquisition candidates, consolidation within the waste industry and economic and market conditions may limit Waste Connections' ability to grow through acquisitions; (12) Waste Connections' growth and future financial performance depend significantly on its ability to integrate acquired businesses into its organization and operations; (13) Waste Connections' acquisitions may not be successful, resulting in changes in strategy, operating losses or a loss on sale of the business acquired; (14) because Waste Connections depends on railroads for its intermodal operations, its operating results and financial condition are likely to be adversely affected by any reduction or deterioration in rail service; (15) Waste Connections' decentralized decision-making structure could allow local managers to make decisions that adversely affect Waste Connections' operating results; (16) Waste Connections may incur additional charges related to capitalized expenditures, which would decrease its earnings; (17) each business that Waste Connections acquires or has acquired may have liabilities that Waste Connections fails or is unable to discover, including environmental liabilities; (18) liabilities for environmental damage may adversely affect Waste Connections' business and earnings; and (19) the adoption of new accounting standards or interpretations could adversely affect Waste Connections' financial results. These risks and uncertainties, as well as others, are discussed in greater detail in Waste Connections' filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K. There may be additional risks of which Waste Connections is not presently aware or that it currently believes are immaterial which could have an adverse impact on its business. Waste Connections makes no commitment to revise or update any forward-looking statements in order to reflect events or circumstances that may change.

                      - financial tables attached -



                         WASTE CONNECTIONS, INC.
                    CONSOLIDATED STATEMENTS OF INCOME
            THREE AND SIX months ENDED JUNE 30, 2007 And 2008
                               (Unaudited)
            (in thousands, except share and per share amounts)

                          Three months ended        Six months ended
                               June 30,                  June 30,
                          2007         2008         2007         2008

  Revenues              $241,084     $267,033     $460,035     $517,333
  Operating expenses:
    Cost of operations   141,574      159,862      270,443      308,994
    Selling, general
     and administrative   24,790       27,065       48,700       54,155
    Depreciation and
     amortization         20,930       24,065       40,520       47,288
    Loss on disposal
     of assets                32          451          192          508
  Operating income        53,758       55,590      100,180      106,388

  Interest expense, net   (8,295)      (8,920)     (16,113)     (18,240)
  Minority interests      (4,130)      (3,807)      (6,970)      (7,179)
  Other income, net          365          345          417          333
  Income before income
   taxes                  41,698       43,208       77,514       81,302

  Income tax provision   (16,432)     (16,974)     (29,868)     (31,950)
  Net income             $25,266      $26,234      $47,646      $49,352

  Basic earnings per
   common share            $0.37        $0.39        $0.70        $0.74

  Diluted earnings per
   common share            $0.36        $0.39        $0.67        $0.73

  Shares used in the
   per share
   calculations:
    Basic             68,592,474   66,468,457   68,529,546   66,628,927
    Diluted           70,625,086   67,842,845   70,606,846   67,982,399



                         WASTE CONNECTIONS, INC.
                  CONDENSED CONSOLIDATED BALANCE SHEETS
                               (Unaudited)
            (in thousands, except share and per share amounts)

                                                December 31,     June 30,
                                                    2007           2008
  ASSETS
  Current assets:
    Cash and equivalents                           $10,298        $10,645
    Accounts receivable, net of
     allowance for doubtful
     accounts of $4,387 and $3,603 at
     December 31, 2007 and June 30, 2008,
     respectively                                  123,882        127,112
  Deferred income taxes                             14,732         16,591
  Prepaid expenses and other current assets         21,953         18,285
      Total current assets                         170,865        172,633

  Property and equipment, net                      865,330        873,035
  Goodwill                                         811,049        824,969
  Intangible assets, net                            93,957        108,096
  Restricted assets                                 19,300         20,486
  Other assets, net                                 21,457         21,380
                                                $1,981,958     $2,020,599

  LIABILITIES AND STOCKHOLDERS' EQUITY
  Current liabilities:
    Accounts payable                               $59,912        $63,311
    Book overdraft                                   8,835          9,157
    Accrued liabilities                             69,578         76,734
    Deferred revenue                                44,074         46,764
    Current portion of long-term debt and
     notes payable                                  13,315         13,481
      Total current liabilities                    195,714        209,447

  Long-term debt and notes payable                 719,518        701,100
  Other long-term liabilities                       38,053         36,817
  Deferred income taxes                            223,308        238,649
      Total liabilities                          1,176,593      1,186,013

  Commitments and contingencies
  Minority interests                                30,220         31,372

  Stockholders' equity:
  Preferred stock: $0.01 par value;
   7,500,000 shares authorized;
   none issued and outstanding                           -              -
   Common stock: $0.01 par value;
   150,000,000 shares authorized;
   67,052,135 and 66,540,160
   shares issued and outstanding at
   December 31, 2007 and June 30, 2008,
   respectively                                        670            665
  Additional paid-in capital                       254,284        234,218
  Retained earnings                                524,481        573,833
  Accumulated other comprehensive income            (4,290)        (5,502)
    Total stockholders' equity                     775,145        803,214
                                                $1,981,958     $2,020,599



                         WASTE CONNECTIONS, INC.
             CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                 SIX MONTHS ENDED JUNE 30, 2007 AND 2008
                               (Unaudited)
                          (Dollars in thousands)

                                                     Six months ended
                                                          June 30,
                                                     2007           2008


  Cash flows from operating activities:
  Net income                                       $47,646        $49,352
  Adjustments to reconcile net income to
   net cash provided by operating activities:
    Loss on disposal of assets                         192            508
    Depreciation                                    38,459         44,474
    Amortization of intangibles                      2,061          2,814
    Deferred income taxes, net of acquisitions       3,741         13,769
    Minority interests                               6,970          7,179
    Amortization of debt issuance costs                961            970
    Stock-based compensation                         3,134          3,956
    Interest income on restricted assets              (261)          (287)
    Closure and post-closure accretion                 522            729
    Excess tax benefit associated with
     equity-based compensation                      (8,534)        (1,928)
    Net change in operating assets and
     liabilities, net of acquisitions               12,387          8,391
  Net cash provided by operating activities        107,278        129,927

  Cash flows from investing activities:
    Payments for acquisitions, net of cash
     acquired                                      (40,591)       (33,437)
    Capital expenditures for property and
     equipment                                     (64,509)       (48,323)
    Proceeds from disposal of assets                   559          1,366
    Increase in restricted assets, net of
     interest income                                  (750)          (900)
    Decrease (increase) in other assets               (485)           112
  Net cash used in investing activities           (105,776)       (81,182)

  Cash flows from financing activities:
    Proceeds from long-term debt                    42,000         90,500
    Principal payments on notes payable and
     long-term debt                                (45,668)      (111,046)
    Change in book overdraft                         5,838            322
    Proceeds from option and warrant exercises      21,082          7,543
    Excess tax benefit associated with
     equity-based compensation                       8,534          1,928
    Distributions to minority interest holders      (6,272)        (6,027)
    Payments for repurchase of common stock        (51,894)       (31,527)
    Debt issuance costs                               (100)           (91)
  Net cash used in financing activities            (26,480)       (48,398)

  Net increase (decrease) in cash and equivalents  (24,978)           347
  Cash and equivalents at beginning of period       34,949         10,298
  Cash and equivalents at end of period             $9,971        $10,645



                          ADDITIONAL STATISTICS
                     THREE MONTHS ENDED JUNE 30, 2008
                          (Dollars in thousands)

Internal Growth: The following table reflects revenue growth for operations owned for at least 12 months:

                                        Three Months Ended
                                           June 30, 2008
  Price                                        5.4%
  Volume                                      (1.5%)
  Intermodal, Recycling and Other              0.7%
  Total                                        4.6%


  Uneliminated Revenue Breakdown:

                                        Three Months Ended
                                           June 30, 2008
  Collection                          $196,047         65.1%
  Disposal and Transfer                 79,913         26.5%
  Intermodal, Recycling and Other       25,327          8.4%
  Total                               $301,287        100.0%

  Inter-company elimination            $34,254


  Days Sales Outstanding for the three months ended June 30, 2008:
  43 (27 net of deferred revenue)


  Internalization for the three months ended June 30, 2008:  66%


  Other Cash Flow Items for the three months ended June 30, 2008:

    Cash Interest Paid:   $10,088
    Cash Taxes Paid:      $12,319


  Debt to Capitalization:  47.1%


  Share Information for the three months ended June 30, 2008:

  Basic shares outstanding                            66,468,457
  Dilutive effect of options and warrants              1,214,259
  Dilutive effect of restricted stock                    160,129
  Diluted shares outstanding                          67,842,845



                     NON-GAAP RECONCILIATION SCHEDULE
                              (in thousands)

Free cash flow, a non-GAAP financial measure, is provided supplementally because it is widely used by investors as a valuation and liquidity measure in the solid waste industry. Waste Connections defines free cash flow as net cash provided by operating activities, plus proceeds from disposal of assets and excess tax benefit associated with equity-based compensation, plus or minus change in book overdraft, less capital expenditures for property and equipment and distributions to minority interest holders. This measure is not a substitute for, and should be used in conjunction with, GAAP financial measures. Management uses free cash flow as one of the principal measures to evaluate and monitor the ongoing financial performance of our operations. Other companies may calculate free cash flow differently.

  Free cash flow reconciliation:

                                       Three Months Ended   Six Months Ended
                                          June 30, 2008       June 30, 2008
  Net cash provided by operating
   activities                                $65,334            $129,927
  Plus: Change in book overdraft               3,918                 322
  Plus: Proceeds from disposal of assets       1,065               1,366
  Plus: Excess tax benefit associated with
   equity-based compensation                     827               1,928
  Less: Capital expenditures for property
   and equipment                             (24,215)            (48,323)
  Less: Distributions to minority
   interest holders                           (3,185)             (6,027)
  Free cash flow                             $43,744             $79,193

  Free cash flow as % of revenues               16.4%               15.3%



                                       Three Months Ended   Six Months Ended
                                          June 30, 2007       June 30, 2007
  Net cash provided by operating
   activities                                $46,364            $107,278
  Plus: Change in book overdraft               5,838               5,838
  Plus: Proceeds from disposal of assets         344                 559
  Plus: Excess tax benefit associated with
   equity-based compensation                   6,274               8,534
  Less: Capital expenditures for property
   and equipment                             (28,362)            (64,509)
  Less: Distributions to minority interest
   holders                                    (3,920)             (6,272)
  Free cash flow                             $26,538             $51,428

  Free cash flow as % of revenues               11.0%               11.2%

First Call Analyst:
FCMN Contact:

SOURCE: Waste Connections, Inc.

CONTACT: Worthing Jackman of Waste Connections, Inc., +1-916-608-8266,
worthingj@wasteconnections.com


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