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Casella Waste Systems, Inc. Announces Second Quarter Fiscal Year 2013 Results; Updates Guidance for Its Fiscal Year

RUTLAND, VT -- (Marketwire) -- 12/03/12 -- Casella Waste Systems, Inc. (NASDAQ: CWST), a regional solid waste, recycling and resource management services company, today reported financial results for its second quarter fiscal year 2013, and provided updated guidance for its 2013 fiscal year.

For the quarter ended October 31, 2012, revenues were $120.3 million, down $9.6 million or 7.3 percent from the same quarter last year, with revenue declines mainly driven by lower recycling commodity prices, lower landfill disposal volumes, and lower roll-off price and volumes.

The company's net loss attributable to common shareholders was ($21.0) million, or ($0.68) per common share for the quarter, compared to net loss of ($0.8) million, or ($0.03) per share for the same quarter last year. The current quarter includes a $1.8 million severance and reorganization charge related to the August realignment, a $0.1 million expense related to the sale of the Maine Energy Recovery Company facility ("Maine Energy"), a $3.9 million loss on derivative instruments, and a $9.7 million loss on debt extinguishment related to the repurchase of the company's second lien notes in October. The quarter ended October 31, 2011 included a $0.4 million legal settlement charge, a $0.1 million development project charge, and a $0.1 million gain on disposal of discontinued operations net of taxes.

Excluding the unusual and one-time charges from each period and assuming no tax impact, the company's net loss attributable to common shareholders was ($5.7) million, or ($0.18) per common share for the quarter, compared to net loss of ($0.2) million, or ($0.01) per share for the same quarter last year.

Operating income was $4.4 million for the quarter, down $7.2 million from the same quarter last year. Excluding the unusual and one-time charges from each period, Adjusted Operating Income* in the current quarter was $6.2 million, down $5.9 million from the same quarter last year. Adjusted EBITDA* was $24.4 million for the quarter, down $6.1 million from same quarter last year.

"The northeastern U.S. economy remained a difficult environment through our second quarter," said John W. Casella, chairman and CEO of Casella Waste Systems. "Recycling commodity prices, landfill volumes at our Western New York landfills, and our roll-off collection line-of-business all underperformed our expectations in the quarter and, as such, we have lowered our guidance for the current fiscal year."

"We believe that broad uncertainty in the national and global economy has translated to declining economic activity across our region over the last 6 months," Casella said. "This trend was especially pronounced in the construction and demolition (C&D) market, where we experienced an unexpected 12.9 percent decline in roll-off revenues year-over-year on lower volumes, weak pricing, and a tough comparison to the second quarter last year when we saw increased demand from Hurricane Irene and Tropical Storm Lee clean-up activity. Despite this weakness, our pricing programs in the commercial and residential lines-of-business remained on track with positive 1.9 percent pricing in the quarter."

"Recycling commodity prices hit bottom in September and began to rebound modestly in October and November as Chinese and domestic demand reemerged," Casella said. "We have taken what we believe is a conservative view on recycling commodity prices for the remainder of our fiscal year with pricing expected to remain consistent with current levels. Maximizing our landfill capacity utilization in Western New York remains a challenge given the depressed volumes of C&D, special waste and residual streams from Marcellus Shale drilling activity.

"We accomplished two important strategic goals in the quarter which we believe position the company well for the future, specifically:

  • "As separately announced this afternoon, we have completed the sale of the property containing our Maine Energy facility to the City of Biddeford, Maine. We expect to permanently close Maine Energy during our third quarter fiscal 2013 at which time we will dismantle the facility and begin transferring the municipal solid waste that was routed to Maine Energy to other disposal facilities that we own or operate. We expect the sale of Maine Energy to improve our financial results on a full year basis from fiscal year 2012, with consolidated Adjusted EBITDA margins expected to improve by roughly 70 basis points, operating income expected to improve by $7.9 million and cash flows expected to increase by roughly $5.6 million per year."

  • "During the second quarter we redeemed our 11.0 percent $180.0 million second lien notes due July 2014 with the proceeds from a $46.0 million common stock offering, a $125.0 million add-on to our existing 7.75 percent senior subordinated notes due February 2019, and borrowings from our senior secured revolving credit facility. This set of transactions improved our credit metrics by lowering leverage, reduced our cash interest expense by roughly $9.0 million per year, and gives us over 3 years before our next major debt maturity."

Fiscal 2013 Outlook
Due primarily to the negative impact of lower than expected recycling commodity prices and landfill volumes, softness in the roll-off line-of-business, and project and contract delays discussed below, the company adjusted its fiscal year guidance in the following categories:

  • Revenues between $468.0 million and $478.0 million.

  • Adjusted EBITDA* between $96.0 million and $100.0 million.

The negative variances from our fiscal year forecast as presented in August to this current forecast include the following impacts from the second quarter and our expectations about the remainder of the fiscal year:

  • While we expected average recycling commodity price per ton to decline through our second quarter, actual commodity prices declined below the levels we had forecasted in August. Given the actual lower results from our second quarter and our current revised commodity price forecast for the remainder of our fiscal year, we expect recycling Adjusted EBITDA to be approximately $1.3 million lower than that reflected in our August fiscal year forecast.

  • While we expected disposal volumes to decline through our second quarter, actual volumes and pricing declined below the levels we had forecasted in August, mainly due to lower C&D volumes, lower special waste volumes, and contract delays for drilling solidification work at our Western New York landfills. Given the actual lower results from our second quarter and our current revised forecast for the remainder of our fiscal year, we expect disposal Adjusted EBITDA to be approximately $2.8 million lower than that reflected in our August fiscal year forecast.

  • The roll-off collection line-of-business underperformed our August forecast projections with weaker than expected net revenue due to lower pricing and volumes. Given the actual lower results from our second quarter and our current revised forecast for the remainder of our fiscal year, we expect roll-off Adjusted EBITDA to be approximately $1.1 million lower than that reflected in our August fiscal year forecast.

  • The delayed start-up of the company's joint venture water treatment facility at its McKean landfill is expected reduce the facility's forecasted Adjusted EBITDA for the fiscal year by $0.7 million from the August fiscal year forecast.

*Non-GAAP Financial Measures
In addition to disclosing financial results prepared in accordance with Generally Accepted Accounting Principles in the United States (GAAP), the company also discloses earnings before interest, taxes, depreciation and amortization, adjusted for accretion, depletion of landfill operating lease obligations, gain on sale of assets, development project charge write-offs, legal settlement charges, bargain purchase gains, asset impairment charges, environmental remediation charges, severance and reorganization charges, as well as expenses from divestiture and financing costs (Adjusted EBITDA) which is a non-GAAP measure. The company also discloses earnings before interest, taxes, adjusted for gain on sale of assets, development project charge write-off, legal settlement charges, bargain purchase gains, asset impairment charges, environmental remediation charges, as well as severance and reorganization charges (Adjusted Operating Income) which is a non-GAAP measure. The company also discloses Free Cash Flow, which is defined as net cash provided by operating activities, less capital expenditures attributable to growth and maintenance (excluding acquisition related capital), less payments on landfill operating leases, less assets acquired through financing leases, plus proceeds from the sale of property and equipment, plus contributions from non-controlling interest holder, which is a non-GAAP measure. Adjusted EBITDA and Adjusted Operating Income are reconciled to net income (loss), while Free Cash Flow is reconciled to net cash provided by operating activities.

The company presents Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow because it considers them important supplemental measures of its performance and believes they are frequently used by securities analysts, investors and other interested parties in the evaluation of the company's results. Management uses these non-GAAP measures to further understand the company's "core operating performance." The company believes its "core operating performance" represents its on-going performance in the ordinary course of operations. The company believes that providing Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow to investors, in addition to corresponding income statement and cash flow statement measures, affords investors the benefit of viewing its performance using the same financial metrics that the management team uses in making many key decisions and understanding how the core business and its results of operations may look in the future. The company further believes that providing this information allows its investors greater transparency and a better understanding of its core financial performance. In addition, the instruments governing the company's indebtedness use EBITDA (with additional adjustments) to measure its compliance with covenants such as interest coverage, leverage and debt incurrence.

Non-GAAP financial measures are not in accordance with or an alternative for GAAP. Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow should not be considered in isolation from or as a substitute for financial information presented in accordance with GAAP, and may be different from Adjusted EBITDA, Adjusted Operating Income, or Free Cash Flow presented by other companies.

About Casella Waste Systems, Inc.
Casella Waste Systems, Inc., headquartered in Rutland, Vermont, provides solid waste management services consisting of collection, transfer, disposal, and recycling services in the northeastern United States. For further information, investors contact Ned Coletta, vice president of finance and investor relations at (802) 772-2239, media contact Joseph Fusco, vice president at (802) 772-2247, or visit the company's website at http://www.casella.com.

Conference call to discuss quarter
The company will host a conference call to discuss these results on Tuesday, December 4, 2012 at 10:00 a.m. ET. Individuals interested in participating in the call should dial (877) 548-9590 or for international participants (720) 545-0037 at least 10 minutes before start time. The call will also be webcast; to listen, participants should visit Casella Waste Systems' website at http://ir.casella.com and follow the appropriate link to the webcast. A replay of the call will be available on the company's website, or by calling (855) 859-2056 or (404) 537-3406 (Conference ID 70181048) until 11:59 p.m. ET on Tuesday, December 11, 2012.

Safe Harbor Statement
Certain matters discussed in this press release are "forward-looking statements" intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such by the context of the statements, including words such as "believe," "expect," "anticipate," "plan," "may," "will," "would," "intend," "estimate," "guidance" and other similar expressions, whether in the negative or affirmative. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry and markets in which we operate and management's beliefs and assumptions. We cannot guarantee that we actually will achieve the plans, intentions, expectations or guidance disclosed in the forward-looking statements made. Such forward-looking statements, and all phases of our operations, involve a number of risks and uncertainties, any one or more of which could cause actual results to differ materially from those described in our forward-looking statements. Such risks and uncertainties include or relate to, among other things: current economic conditions that have adversely affected and may continue to adversely affect our revenues and our operating margin; we may be unable to reduce costs or increase pricing or volumes sufficiently to achieve estimated Adjusted EBITDA and other targets; landfill operations and permit status may be affected by factors outside our control; we may be required to incur capital expenditures in excess of our estimates; fluctuations in energy pricing or the commodity pricing of our recyclables may make it more difficult for us to predict our results of operations or meet our estimates; we may incur environmental charges or asset impairments in the future; and we may be unable to decommission our waste-to-energy facility on a timely basis and shift waste volumes to other landfill sites. There are a number of other important risks and uncertainties that could cause our actual results to differ materially from those indicated by such forward-looking statements. These additional risks and uncertainties include, without limitation, those detailed in Item 1A, "Risk Factors" in our Form 10-K for the year ended April 30, 2012.

We undertake no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.

                CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                (Unaudited)
                  (In thousands, except amounts per share)

                            Three Months Ended         Six Months Ended
                         ------------------------  ------------------------
                         October 31,  October 31,  October 31,  October 31,
                             2012         2011         2012         2011
                         -----------  -----------  -----------  -----------

Revenues                 $   120,335  $   129,866  $   241,529  $   257,059

Operating expenses:
  Cost of operations          85,474       86,627      170,251      171,851
  General and
   administration             13,985       16,062       29,307       32,268
  Depreciation and
   amortization               14,632       15,061       29,388       29,567
  Severance and
   reorganization costs        1,793            -        1,827            -
  Expense from
   divestiture and
   financing costs                77            -          631            -
  Legal settlement                 -          359            -        1,359
  Development project
   charge                          -          131            -          131
                         -----------  -----------  -----------  -----------
                             115,961      118,240      231,404      235,176
                         -----------  -----------  -----------  -----------

Operating income               4,374       11,626       10,125       21,883

Other expense/(income),
 net:
  Interest expense, net       11,689       11,207       23,533       22,357
  Loss from equity
   method investment             109        1,523        1,875        3,781
  Loss on derivative
   instruments                 3,896            -        3,896            -
  Loss on debt
   extinguishment              9,670            -        9,670            -
  Other income                  (311)        (327)        (441)        (432)
                         -----------  -----------  -----------  -----------
                              25,053       12,403       38,533       25,706
                         -----------  -----------  -----------  -----------


Loss from continuing
 operations before
 income taxes and
 discontinued operations     (20,679)        (777)     (28,408)      (3,823)
Provision for income
 taxes                           413           67        1,063          728
                         -----------  -----------  -----------  -----------

Loss from continuing
 operations before
 discontinued operations     (21,092)        (844)     (29,471)      (4,551)

Discontinued operations:
  Gain on disposal of
   discontinued
   operations, net of
   income taxes (1)                -           79            -          725
                         -----------  -----------  -----------  -----------

Net loss                     (21,092)        (765)     (29,471)      (3,826)
                         -----------  -----------  -----------  -----------

  Less: Net loss
   attributable to
   noncontrolling
   interest                     (125)           -         (133)           -
                         -----------  -----------  -----------  -----------

Net loss attributable to
 common stockholders     $   (20,967) $      (765) $   (29,338) $    (3,826)
                         ===========  ===========  ===========  ===========

Weighted average common
 shares outstanding           30,872       26,759       28,932       26,661
                         ===========  ===========  ===========  ===========

Net loss per common
 share                   $     (0.68) $     (0.03) $     (1.01) $     (0.14)
                         ===========  ===========  ===========  ===========

Adjusted EBITDA (2)      $    24,392  $    30,532  $    48,708  $    59,194
                         ===========  ===========  ===========  ===========


                CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (Unaudited)
                               (In thousands)

                                                    October 31,   April 30,
                      ASSETS                           2012         2012
                                                   ------------ ------------

CURRENT ASSETS:
  Cash and cash equivalents                        $      1,901 $      4,534
  Restricted cash                                        23,655           76
  Accounts receivable - trade, net of allowance
   for doubtful accounts                                 50,978       47,472
  Other current assets                                   17,495       15,274
                                                   ------------ ------------
Total current assets                                     94,029       67,356

Property, plant and equipment, net of accumulated
 depreciation and amortization                          424,839      416,717
Goodwill                                                102,722      101,706
Intangible assets, net                                    4,217        2,970
Restricted assets                                           521          424
Notes receivable - related party/employee                   514          722
Investments in unconsolidated entities                   20,729       22,781
Other non-current assets                                 21,904       21,067
                                                   ------------ ------------

Total assets                                       $    669,475 $    633,743
                                                   ============ ============

       LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Current maturities of long-term debt and capital
   leases                                          $     73,795 $      1,228
  Current maturities of financing lease
   obligations                                              349          338
  Accounts payable                                       51,326       46,709
  Other accrued liabilities                              42,904       40,060
                                                   ------------ ------------
Total current liabilities                               168,374       88,335

Long-term debt and capital leases, less current
 maturities                                             412,051      473,381
Financing lease obligations, less current
 maturities                                               1,640        1,818
Other long-term liabilities                              52,345       51,978

Total stockholders' equity                               35,065       18,231
                                                   ------------ ------------

Total liabilities and stockholders' equity         $    669,475 $    633,743
                                                   ============ ============

                CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (Unaudited)
                               (In thousands)

                                                      Six Months Ended
                                                 --------------------------
                                                  October 31,   October 31,
                                                     2012          2011
                                                 ------------  ------------
Cash Flows from Operating Activities:
Net loss                                         $    (29,471) $     (3,826)
Gain on disposal of discontinued operations, net            -          (725)
Adjustments to reconcile net loss to net cash
 provided by operating activities -
  Gain on sale of property and equipment                 (223)         (754)
  Depreciation and amortization                        29,388        29,567
  Depletion of landfill operating lease
   obligations                                          4,878         4,514
  Interest accretion on landfill and
   environmental remediation liabilities                1,858         1,740
  Development project charge                                -           131
  Amortization of discount on second lien notes
   and senior subordinated notes                          502           467
  Loss from equity method investments                   1,875         3,781
  Loss on derivative instruments                        3,896             -
  Loss on debt extinguishment                           9,670             -
  Stock-based compensation                              1,306         1,366
  Excess tax benefit on the vesting of share
   based awards                                          (188)         (219)
  Deferred income taxes                                   907         1,008
  Changes in assets and liabilities, net of
   effects of acquisitions and divestitures            (2,023)        4,428
                                                 ------------  ------------
    Net Cash Provided by Operating Activities          22,375        41,478
                                                 ------------  ------------
Cash Flows from Investing Activities:
  Acquisitions, net of cash acquired                   (4,635)         (715)
  Additions to property, plant and equipment
      - acquisitions                                     (417)         (133)
      - growth                                         (8,257)       (6,410)
      - maintenance                                   (25,368)      (29,427)
  Payment for capital related to divestiture             (618)            -
  Payments on landfill operating lease contracts       (3,298)       (3,314)
  Proceeds from sale of property and equipment            557         1,170
  Investments in unconsolidated entities               (1,000)         (935)
                                                 ------------  ------------
    Net Cash Used In Investing Activities             (43,036)      (39,764)
                                                 ------------  ------------
Cash Flows from Financing Activities:
  Proceeds from long-term borrowings                  236,177        82,100
  Principal payments on long-term debt               (227,028)      (82,146)
  Change in restricted cash                           (23,579)            -
  Payment of tender premium and costs on second
   lien notes                                          (6,745)            -
  Payments of financing costs                          (4,329)         (184)
  Net proceeds from the sale of Class A common
   stock                                               42,149             -
  Proceeds from the exercise of share based
   awards                                                   -           176
  Excess tax benefit on the vesting of share
   based awards                                           188           219
  Contributions from noncontrolling interest
   holder                                               1,195             -
                                                 ------------  ------------
    Net Cash Provided By Financing Activities          18,028           165
                                                 ------------  ------------
    Net Cash Provided By Discontinued Operations            -           725
                                                 ------------  ------------
Net (decrease) increase in cash and cash
 equivalents                                           (2,633)        2,604
Cash and cash equivalents, beginning of period          4,534         1,817
                                                 ------------  ------------
Cash and cash equivalents, end of period         $      1,901  $      4,421
                                                 ============  ============
Supplemental Disclosures:
Cash interest                                    $     22,578  $     20,531
Cash income taxes, net of refunds                $         71  $      5,281


                CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 (Unaudited)
                               (In thousands)

Note 1: Divestiture and Discontinued Operations

Maine Energy Divestiture
  On August 1, 2012, we executed a purchase and sale agreement with the City
of Biddeford, Maine pursuant to which we agreed to sell the real and
personal property of Maine Energy, which resides in our Eastern region, to
the City of Biddeford, subject to satisfaction of conditions precedent and
closing. We agreed to sell Maine Energy for undiscounted purchase
consideration of $6,650, which shall be paid in installments over the next
21 years, subject to the terms of the purchase and sale agreement. The
transaction closed on November 30, 2012 and we waved certain conditions
precedent not satisfied at that time. Post closing, we are entitled to
continue operations of Maine Energy for our benefit and obligated to begin
work to decommission the facility in accordance with the provisions of the
agreement within a period not to exceed six months after the closing date.
Following the decommissioning of Maine Energy, it is our responsibility to
demolish the facility, at our cost, within twelve months of the closing date
and in accordance with the terms of the purchase and sale agreement.

Discontinued Operations
  On January 23, 2011, we entered into a purchase and sale agreement and
related agreements to sell non-integrated recycling assets and select
intellectual property assets to a new company (the "Purchaser") formed by
Pegasus Capital Advisors, L.P. and Intersection LLC for $130,400 in gross
proceeds. Pursuant to these agreements, we divested non-integrated recycling
assets located outside our core operating regions of New York,
Massachusetts, Vermont, New Hampshire, Maine and northern Pennsylvania,
including 17 material recovery facilities ("MRFs"), one transfer station and
certain related intellectual property assets. Following the transaction, we
retained four integrated MRFs located in our core operating regions. As a
part of the disposition, we also entered into a ten-year commodities
marketing agreement with the Purchaser to market 100% of the tonnage from
three of our remaining integrated MRFs.

  We completed the transaction on March 1, 2011 for $134,195 in gross cash
proceeds. This included an estimated $3,795 working capital and other
purchase price adjustment, which was subject to further adjustment, as
defined in the purchase and sale agreement. The final working capital
adjustment, along with additional legal expenses related to the transaction,
of $646 was recorded to gain on disposal of discontinued operations, net of
income taxes in the first quarter of fiscal year 2012.

  In the three months ended October 31, 2011, we recorded an additional
working capital adjustment of $79 to gain on disposal of discontinued
operations, net of income taxes, which related to our subsequent collection
of receivable balances that were released to us for collection by the
Purchaser.

Note 2: Non - GAAP Financial Measures

  In addition to disclosing financial results prepared in accordance with
Generally Accepted Accounting Principles in the United States (GAAP), we
also disclose earnings before interest, taxes, depreciation and
amortization, adjusted for accretion, depletion of landfill operating lease
obligations, gain on sale of assets, development project charge write-offs,
legal settlement charges, bargain purchase gains, asset impairment charges,
environmental remediation charges, severance and reorganization charges, as
well as expenses from divestiture and financing costs (Adjusted EBITDA)
which is a non-GAAP measure. We also disclose earnings before interest,
taxes, adjusted for gain on sale of assets, development project charge
write-offs, legal settlement charges, bargain purchase gains, asset
impairment charges, environmental remediation charges, severance and
reorganization charges, as well as expenses from divestiture and financing
costs (Adjusted Operating Income) which is a non-GAAP measure. We also
disclose Free Cash Flow, which is defined as net cash provided by operating
activities, less capital expenditures attributable to growth and maintenance
(excluding acquisition related capital), less payments on landfill operating
leases, less assets acquired through financing leases, plus proceeds from
the sale of property and equipment, plus contributions from non-controlling
interest holder, which is a non-GAAP measure. Adjusted EBITDA and Adjusted
Operating Income are reconciled to net income (loss), while Free Cash Flow
is reconciled to net cash provided by operating activities.

  We present Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow
because we consider them important supplemental measures of our performance
and believe they are frequently used by securities analysts, investors and
other interested parties in the evaluation of our results. We use these non-
GAAP measures to further understand our "core operating performance." We
believe our "core operating performance" represents our on-going performance
in the ordinary course of operations. We believe that providing Adjusted
EBITDA, Adjusted Operating Income, and Free Cash Flow to investors, in
addition to corresponding income statement and cash flow statement measures,
affords investors the benefit of viewing our performance using the same
financial metrics that our management team uses in making many key decisions
and understanding how the core business and our results of operations may
look in the future. We further believe that providing this information
allows our investors greater transparency and a better understanding of our
core financial performance. In addition, the instruments governing our
indebtedness use EBITDA (with additional adjustments) to measure our
compliance with covenants such as interest coverage, leverage and debt
incurrence.

  Non-GAAP financial measures are not in accordance with or an alternative
for GAAP. Adjusted EBITDA, Adjusted Operating Income, and Free Cash Flow
should not be considered in isolation from or as a substitute for financial
information presented in accordance with GAAP, and may be different from
Adjusted EBITDA, Adjusted Operating Income, or Free Cash Flow presented by
other companies.


Following is a reconciliation of Adjusted EBITDA and Adjusted Operating
 Income to Net Loss:

                         Three Months Ended           Six Months Ended
                     --------------------------  --------------------------
                      October 31,   October 31,   October 31,   October 31,
                         2012          2011          2012          2011
                     ------------  ------------  ------------  ------------

Net Loss             $    (21,092) $       (765) $    (29,471) $     (3,826)
  Gain on disposal
   of discontinued
   operations, net              -           (79)            -          (725)
  Provision for
   income taxes               413            67         1,063           728
  Other expense, net       13,364         1,196        15,001         3,349
  Interest expense,
   net                     11,689        11,207        23,533        22,357
  Legal settlement              -           359             -         1,359
  Expense from
   divestiture and
   financing costs             77             -           631             -
  Depreciation and
   amortization            14,632        15,061        29,388        29,567
  Development
   project charge               -           131             -           131
  Severance and
   reorganization
   charges                  1,793             -         1,827             -
  Depletion of
   landfill
   operating lease
   obligations              2,591         2,484         4,878         4,514
  Interest accretion
   on landfill and
   environmental
   remediation
   liabilities                925           871         1,858         1,740
                     ------------  ------------  ------------  ------------
Adjusted EBITDA (2)  $     24,392  $     30,532  $     48,708  $     59,194
  Depreciation and
   amortization           (14,632)      (15,061)      (29,388)      (29,567)
  Depletion of
   landfill
   operating lease
   obligations             (2,591)       (2,484)       (4,878)       (4,514)
  Interest accretion
   on landfill and
   environmental
   remediation
   liabilities               (925)         (871)       (1,858)       (1,740)
                     ------------  ------------  ------------  ------------
Adjusted Operating
 Income (2)          $      6,244  $     12,116  $     12,584  $     23,373
                     ============  ============  ============  ============

Following is a reconciliation of Free Cash Flow to Net Cash Provided by
 Operating Activities:

                         Three Months Ended           Six Months Ended
                     --------------------------  --------------------------
                      October 31,   October 31,   October 31,   October 31,
                         2012          2011          2012          2011
                     ------------  ------------  ------------  ------------
Net Cash Provided by
 Operating
 Activities          $     14,854  $     27,538  $     22,375  $     41,478
Capital expenditures
 - growth and
 maintenance              (17,229)      (20,969)      (33,625)      (35,837)
Payments on landfill
 operating lease
 contracts                 (1,484)       (1,456)       (3,298)       (3,314)
Proceeds from sale
 of property and
 equipment                    292           971           557         1,170
Contributions from
 noncontrolling
 interest holder              474             -         1,195             -
                     ------------  ------------  ------------  ------------
Free Cash Flow (2)   $     (3,093) $      6,084  $    (12,796) $      3,497
                     ============  ============  ============  ============


                CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
                          SUPPLEMENTAL DATA TABLES
                                (Unaudited)
                               (In thousands)

Amounts of our total revenues attributable to services provided for the
 three and six months ended October 31, 2012 and 2011 are as follows:

                                     Three Months Ended October 31,
                             ----------------------------------------------
                                         % of Total              % of Total
                                 2012      Revenue       2011      Revenue
                             ----------- ----------  ----------- ----------
Collection                   $    53,104       44.1% $    54,764       42.2%
Disposal                          32,382       26.9%      34,254       26.4%
Power generation                   2,793        2.3%       3,190        2.4%
Processing and organics           13,795       11.5%      13,992       10.8%
                             ----------- ----------  ----------- ----------
  Solid waste operations         102,074       84.8%     106,200       81.8%
Major accounts                     9,221        7.7%       9,847        7.6%
Recycling                          9,040        7.5%      13,819       10.6%
                             ----------- ----------  ----------- ----------
Total revenues               $   120,335      100.0% $   129,866      100.0%
                             =========== ==========  =========== ==========

                                      Six Months Ended October 31,
                             ----------------------------------------------
                                         % of Total              % of Total
                                 2012      Revenue       2011      Revenue
                             ----------- ----------  ----------- ----------
Collection                   $   106,147       43.9% $   108,390       42.2%
Disposal                          63,349       26.2%      66,426       25.8%
Power generation                   5,456        2.3%       6,233        2.4%
Processing and organics           28,427       11.8%      28,730       11.2%
                             ----------- ----------  ----------- ----------
  Solid waste operations         203,379       84.2%     209,779       81.6%
Major accounts                    18,746        7.8%      20,557        8.0%
Recycling                         19,404        8.0%      26,723       10.4%
                             ----------- ----------  ----------- ----------
Total revenues               $   241,529      100.0% $   257,059      100.0%
                             =========== ==========  =========== ==========


Components of revenue growth for the three months ended October 31, 2012
 compared to the three months ended October 31, 2011 are as follows:

                                            % of     % of Solid
                                           Related      Waste    % of Total
                               Amount     Business   Operations    Company
                            -----------  ----------  ----------  ----------
Solid Waste Operations:
Collection                  $       (74)       -0.1%       -0.1%       -0.1%
Disposal                           (184)       -0.5%       -0.2%       -0.1%
                            -----------              ----------  ----------
Solid Waste Yield                  (258)                   -0.3%       -0.2%

Collection                       (2,379)                   -2.2%       -1.8%
Disposal                         (1,259)                   -1.2%       -1.0%
Organics and processing             140                     0.1%        0.1%
                            -----------              ----------  ----------
Solid Waste Volume               (3,498)                   -3.3%       -2.7%

Fuel surcharge                      (67)                   -0.1%        0.0%
Commodity price & volume           (849)                   -0.8%       -0.6%
Acquisitions                      1,029                     1.0%        0.8%
Closed landfill                    (482)                   -0.5%       -0.4%
                            -----------              ----------  ----------
Total Solid Waste                (4,126)                   -4.0%       -3.1%
                            -----------              ==========  ==========

Major Accounts                     (626)                               -0.5%
                            -----------                          ==========

                                                        % of
                                                      Recycling
Recycling Operations:                                Operations
                                                     ----------
Commodity price                  (4,905)                  -35.5%       -3.8%
Commodity volume                    126                     0.9%        0.1%
                            -----------              ----------  ----------
Total Recycling                  (4,779)                  -34.6%       -3.7%
                            -----------              ==========  ==========

Total Company               $    (9,531)                               -7.3%
                            ===========                          ==========

Solid Waste Internalization Rates by Region:

                               Three Months Ended       Six Months Ended
                                   October 31,             October 31,
                             ----------------------  ----------------------
                                2012        2011        2012        2011
                             ----------  ----------  ----------  ----------
Eastern region                     53.5%       59.7%       53.7%       56.9%
Western region                     74.2%       77.0%       73.4%       76.6%
Solid waste internalization        65.0%       68.9%       64.5%       67.3%


                CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
                          SUPPLEMENTAL DATA TABLES
                                (Unaudited)
                               (In thousands)

GreenFiber Financial Statistics (1):

                               Three Months Ended       Six Months Ended
                                   October 31,             October 31,
                             ----------------------  ----------------------
                                2012        2011        2012        2011
                             ----------  ----------  ----------  ----------
Revenues                     $   19,494  $   21,841  $   32,595  $   37,856
Net loss                           (297)     (3,049)     (3,866)     (7,564)
Cash flow provided by (used
 in) operations                     805        (949)      1,031      (2,258)
Net working capital changes        (662)       (149)      1,274         726
Adjusted EBITDA              $    1,467  $     (800) $     (243) $   (2,984)

As a percentage of revenues:

Net loss                           -1.5%      -14.0%      -11.9%      -20.0%
Adjusted EBITDA                     7.5%       -3.7%       -0.7%       -7.9%

(1) We hold a 50% interest in US Green Fiber, LLC ("GreenFiber"), a joint
 venture that manufactures, markets and sells cellulose insulation made
 from recycled fiber.

Components of Growth and Maintenance Capital Expenditures (1):

                               Three Months Ended       Six Months Ended
                                   October 31,             October 31,
                             ----------------------  ----------------------
                                2012        2011        2012        2011
                             ----------  ----------  ----------  ----------
Growth capital expenditures:
Landfill development         $      257  $      203  $      589  $      244
Water treatment facility          3,908           -       4,668           -
Transfer station
 construction                     1,434           -       1,434
Landfill gas-to-energy
 project                              -         792           -       1,159
MRF equipment upgrades                -       2,498           -       3,007
Other                               656       1,774       1,566       2,000
                             ----------  ----------  ----------  ----------
Total Growth Capital
 Expenditures                     6,255       5,267       8,257       6,410
                             ----------  ----------  ----------  ----------

Maintenance capital
 expenditures:
Vehicles, machinery /
 equipment and containers    $    3,168  $    3,868  $    6,221  $   10,308
Landfill construction &
 equipment                        7,172       9,807      18,094      16,804
Facilities                          501       1,815         780       1,990
Other                               133         212         273         325
                             ----------  ----------  ----------  ----------
Total Maintenance Capital
 Expenditures                    10,974      15,702      25,368      29,427
                             ----------  ----------  ----------  ----------

Total Growth and Maintenance
 Capital Expenditures        $   17,229  $   20,969  $   33,625  $   35,837
                             ==========  ==========  ==========  ==========

(1) Our capital expenditures are broadly defined as pertaining to either
 growth, maintenance or acquisition activities. Growth capital expenditures
 are defined as costs related to development of new airspace, permit
 expansions, and new recycling contracts along with incremental costs of
 equipment and infrastructure added to further such activities. Growth
 capital expenditures include the cost of equipment added directly as a
 result of organic business growth as well as expenditures associated with
 increasing infrastructure to increase throughput at transfer stations and
 recycling facilities. Maintenance capital expenditures are defined as
 landfill cell construction costs not related to expansion airspace, costs
 for normal permit renewals, and replacement costs for equipment due to age
 or obsolescence. Acquisition capital expenditures are defined as costs of
 equipment added directly as a result of new business growth related to an
 acquisition.

Investors:
Ned Coletta
Vice President of Finance and Investor Relations
(802) 772-2239

Media:
Joseph Fusco
Vice President
(802) 772-2247

http://www.casella.com

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