WasteDive: Covanta intends to close multiple plants in coming years, divestitures still possible.
- Covanta’s strategic review process is complete, and the company’s North American portfolio will be changing. “We have now identified a number of sites where we intend to shutter operations over the next several years, including several public sector operating contracts where we have already notified our clients that we do not intend to extend contracts when they expire,” said CEO Michael Ranger during a Friday earnings call.
- The company also identified the potential for $30 million in annual cost reductions by 2023, with some starting this year due to voluntary early retirements. This does not include any potential asset divestitures, which remain under consideration.
- Looking ahead, the company projected it could achieve $600 million of adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) and $250 million of free cash flow by 2024. Driving the projections, in part, is the company’s ongoing expansion overseas, with its new Rookery South energy recovery facility set to begin receiving waste in the U.K. soon.