WCN 10-K & 10-Q changes, risk factors and insider trading

Our industry is highly competitive and requires substantial labor and capital resources. Some of the markets in which we compete or will seek to compete are served by one or more large, national companies, as well as by regional and local companies of varying sizes and resources. Some of our competitors may be able to provide or be willing to bid their services at lower prices than we may be willing to offer, which could impact our ability to win new business or retain existing business, including municipal contracts that come up for renewal. We also compete with counties, provinces, municipalities and solid waste districts that maintain or could develop their own waste collection and disposal operations. These operators may have financial advantages over us because of their access to user fees and similar charges, tax revenues and tax-exempt financing. If we are not able to replace revenues from contracts lost through competitive bidding or early termination or from the renegotiation of existing contracts with other revenues within a reasonable time, our revenues could decline. In addition, existing and future competitors may develop or offer new services or technologies, new facilities or other competitive advantages. Our inability to compete effectively could hinder our growth or negatively impact our operating results.

We seek price increases necessary to offset increased costs, to improve operating margins and to obtain adequate returns on our deployed capital. Inflationary or other cost pressures may outpace price increases or drive the need for additional price increases; and contractual, general economic, competitive or market-specific conditions sometimes limit or delay our ability to raise prices or otherwise impact our plans with respect to implementing price increases. As a result of these factors, we may be unable to offset increases in costs, improve operating margins and obtain adequate investment returns through price increases. WePrice increases may also result in customer churn as we may lose volumes which we are unable to replace at equivalent levels, including from either losing customers to lower-priced competitors,competitors andor new competitors may enterentering our markets as we raise prices.

While we expect to fund some of our acquisitions with our existing resources, additional financing to pursue additional acquisitions may be required. Our ability to access the capital markets may be restricted at a time when we would like, or need, to do so, or additional financing may not be available to us on favorable terms, which could have an impact on our flexibility to pursue additional acquisition opportunities. In addition, disruptions in the capital and credit markets could adversely affect our ability to draw on our credit facility or raise other capital. Our access to funds under the credit facility is dependent on the ability of the banks that are parties to the facility to meet their funding commitments. Those banks may not be able to meet their funding commitments if they experience shortages of capital and liquidity or if they experience excessive volumes of borrowing requests within a short period.

We derive a significant portion of our revenues from market areas where we have exclusive arrangements, including franchise agreements, municipal contracts and certificates issued by Washington State known as G Certificates. Many franchise agreements and municipal contracts are for a specified term and are, or will be, subject to competitive bidding in the future. For example, we have approximately 466454 contracts, representing approximately 3.1%4.0% of our annual revenues, which are set for expiration or automatic renewal on or before December 31, 2025.2026. Although we intend to bid on existing contracts subject to competitive bidding in the future and additional municipal contracts and franchise agreements, we may not be the successful bidder, or we may need to lower our price in order to retain the contract. In addition, some of our customers, including municipalities, have terminated and others may terminate their contracts with us before the end of the terms of those contracts. Similar risks may affect our contracts to operate municipally-owned assets, such as landfills.

Governmental action may also affect our exclusive arrangements. Municipalities may annex unincorporated areas within counties where we provide collection services. As a result, our customers in annexed areas may be required to obtain services from competitors that have been previously franchised by the annexing municipalities to provide those services. In addition, municipalities in which we provide services on a competitive basis may elect to franchise those services to other service providers. Unless we are awarded franchises by these municipalities, we will lose customers. Municipalities may also decide to provide services to their residents themselves, on an optional or mandatory basis, causing us to lose customers. If we are not able to replace revenues from contracts lost through competitive bidding or early termination or from the renegotiation of existing contracts with other revenues within a reasonable time, our revenues could decline. Municipalities sometimes also promulgate “flow control” laws and regulations requiring us to deliver waste we collect within a particular jurisdiction to facilities not owned or controlled by us, which could increase our costs and reduce our revenues.

We currently own and/or operate 113114 landfills throughout the United States and Canada. Our ability to meet our financial and operating objectives depends in part on our ability to acquire, or renew landfill operating permits, expand existing landfills and develop new landfill sites on terms that are acceptable to us. It has become increasingly difficultdifficult, expensive and expensivetime-consuming to obtain required permits and approvals to build, operate and expand solid waste management facilities, including landfills and transfer stations.landfills. In addition, approvals may include operating restrictions or additional requirements, which could impact financial results. Although generally less time consuming, the process of obtaining permits and approvals for E&P landfills has similar uncertainties. Operating permits for landfills in states and provinces where we operate must generally be renewed every five to ten years, although some permits are required to be renewed more frequently. These operating permits often must be renewed several times during the permitted life of a landfill. The permit and approval process is often time consuming,time-consuming, requiring numerous hearings and compliance with zoning, environmental and other requirements. Further, permits may be subject to resistance from communities, citizen groups, adjacent landowners,landowners and businesses, governmental agencies,agencies and municipalities, and may also be subject to other political pressures. A delay in or failure to obtain or renew operating permits for our landfills could have a material adverse effect on our financial condition, operating results, or cash flow. Furthermore, compliance issues with our operating authorizations could result in the need for us to transport our collected waste to other landfills we operate, or to our competitors’ landfills, which could increase our operating costs.

States and municipalities are also increasingly adopting requirements for environmental justice reviews as part of certain permitting decisions. These policies generally require permitting agencies to give heightened attention to the potential for projects to disproportionately impact low-income and minority communities. The permitting and approval process is frequently challenged by special interest and other groups, including those utilizing social media to further their objectives, and may result in the denial of a permit or renewal, the award of a permit or renewal for a shorter duration than we believed was otherwise required by law, or burdensome terms and conditions being imposed on our operations. For example, see the discussions regarding the Los Angeles County, California Landfill Expansion Litigation—A. Chiquita Canyon, LLC Lawsuit Against Los Angeles County in Note 13, “Commitments and Contingencies,” of our consolidated financial statements included in Item 8 of this Annual Report on Form 10-K. We may not be able to obtain new landfill sites or expand the permitted capacity of our existing landfills when necessary, and may ultimately be required to expense up to the carrying value of the landfill or expansion project, less the recoverable value of the property and other amounts recovered. Obtaining new landfill sites is important to our expansion into new, non-exclusive solid waste markets and in our E&P waste business. If we do not believe that we can obtain a landfill site in a non-exclusive market, we may choose not to enter that market. Expanding existing landfill sites is important in those markets where the remaining lives of our landfills are relatively short. We may choose to forego acquisitions and internal growth in these markets because increased volumes would further shorten the lives of these landfills. Any of these circumstances could adversely affect our operating results.

Labor is one of our highest costs and relatively small increases in labor costs per employee could materially affect our cost structure. A shortage of qualified employees in our markets would require us to incur additional costs related to wages and benefits, to hire more expensive temporary employees or to contract for services with more expensive third-party vendors. In addition, higher turnover can result in increased costs associated with recruiting and training; it can also impact operating costs, including maintenance and risk. Increased competition with other businesses in our markets for qualified employees has driven and may continue to drive higher turnover and increase the time it takes to fill job openings, and we have increased and may continue to increase resources for hiring and providing training for new and existing employees.

Increases in costs for fleet, equipmentequipment, technology and landfill construction costs due to cost pressures, regulatory requirements, tariffs, acquisitions, new contracts and growth projectsprojects, including sustainability-related projects, could result in capital expenditures being higher than anticipated. In addition, supply chain constraints and inflationary pressures have resulted in and are expected to continue to result in higher costs, delays or lack of availability of fleet, equipment or supplies. This could impact our ability to generate free cash flow in line with our expectations, the timing of our free cash flow generation, or otherwise adversely affect our financial results.

Furthermore, the completion or closure of a landfill site does not end our environmental obligations. After completion or closure of a landfill site, or a section of an active landfill, we sometimesmay incur additional costs,costs. asFor we didexample, in 2023 and 2024 as a result of2024, an ongoing elevated temperature landfill (“ETLF”) event, whichevent resulted in increased leachate generation and related capital and operating expenses that increased our closure and post closure costs at our Chiquita Canyon LandfillLandfill, which ultimately ceased active waste disposal operations as of December 31, 2024. In addition, environmental problems may occur that could result in substantial remediation costs, regulatory enforcement actions and related fines or potential litigation. For example, see the discussions regarding the Elevated Temperature Landfill Event, Chiquita Canyon Landfill Civil Litigation, and County of Los Angeles Litigation in Note 13, “Commitments and Contingencies,” of our consolidated financial statements included in Item 8 of this Annual Report on Form 10 K.10-K. The potential increased regulation of per- and polyfluoroalkyl substances (“PFAS”), bisphenol A (“BPA”) phthalates, methane and other emerging contaminants could result in greater expenditures for closure and post-closure costs. It is also possible that accruals may need to be expanded and that costs incurred related to these activities could be accelerated. Paying additional amounts for closure or post-closure costs and/or for environmental remediation and/or for litigation could harm our financial condition, operating results, or cash flow.

The value of crude oil has impacted and may in the future impact the level of drilling or production activity in the basins where we operate; however, we cannot provide assurances that higher crude oil prices will result in increased capital spending and related activity in the basins where we operate. E&P companies may elect to decrease investment in basins where lower crude oil prices or volatility in crude oil prices make the returns on investment inadequate or uncertain or impact the ability of E&P companies to access capital on economically advantageous terms or at all. Similarly, growth in production rates may be impacted by factors including volatility in crude oil prices and the level of global demand, as well as limitations on production as a result of higher operational costs. Energy transition, or a transformation of the global energy sector from fossil-based systems of energy production and consumption to renewable energy sources or nuclear sources, could also affect investments by E&P companies in the basins where we operate. In certain locations where blending activities occur, the value of any recovered oil could vary based on the value of crude oil.

SinglestreamSingle-stream recycling facilities process a wide range of commingled materials and tend to receive a higher percentage of non-recyclables, particularly in residential collection, which results in increased processing and residual disposal costs to achieve quality standards. As a result, we have increased the fees that we charge customers at our recycling facilities in order to recover the higher processing costs for recyclables. This may result in lower recycled commodity volumes at our recycling facilities, as customers may elect to pursue cheaper alternatives for processing or disposal. Any such reduction could impact revenues, operating results and cash flow. Some of our recycling operations offer rebates to customers based on the market prices of commodities we buy to process for resale. Therefore, if we recognize increased revenues resulting from higher prices for recyclable commodities, the rebates we pay to suppliers will also increase, which also may impact our operating results.

Variations in the volume of methane gas generated, marketed and sold by our landfill gas recovery operations also affect our results. Our operations and gas generation rates are impacted by many variables, including the maintenance and operations of recovery wells and gas generation systems, the amount and type of waste in our landfills, the age of the landfill, weather and related temperature. In addition, there may be variability in the extent to which we are able to beneficially market and sell for beneficial reuse the gas generated and captured, including as a result of delays in the start-up of new facilities or other impacts to operations. To the extent that we develop and construct new renewable natural gas, or RNG, facilities, either directly or through partnerships with third parties, the cost and timing of the completion of new facilities is uncertain as is the quantity and quality of gas generated and the associated operating costs and benefits, including any tax benefits related to the Inflation Reduction Act of 2022.

Based on historic trends, excluding impactsany impact from an economic recession, we would expect our operating results to vary seasonally, with revenues typically lowest in the first quarter, higher in the second and third quarters, and lower in the fourth quarter than in the second and third quarters. We expect the fluctuation in our revenues between our highest and lowest quarters to be approximately 10%. This seasonality reflects the lower volume of solid waste generated during the late fall, winter and early spring because of decreased construction and demolition activities during the winter months in Canada and the U.S., and reduced E&P activity during harsh weather conditions. Conversely, mild winter weather conditions may reduce demand for oil and natural gas, which may cause our customers to curtail their drilling programs, which could result in production of lower volumes of E&P waste.

Our operations and assets are subject to risks associated with the effects of climate change and adverse weather conditions. Risks associated with climate change, such as increased frequency and/or intensity of weather events, flooding, wildfires, sea level rise, and other weather-weather and climate-related events, could negatively impact our operations. For example, these events could disrupt or result in suspension of collection activities, disrupt landfill and transfer station operations, increase maintenance expenses, hinder landfill development or expansion, or generate increased volumes of leachate to manage.leachate. It is also possible that these events could disrupt our customers’ businesses, thereby reducing the amount of waste generated by their operations.

Additional laws and regulations related to climate change, including restricting emissions of greenhouse gases, or GHG, could also be promulgated, and such laws and rules could increase our compliance costs, and result in heightened capital expenditures. Furthermore, additional climate change-related regulation could result in increased operational costs or disruption to our customers’ business, thereby impacting our operational results and financial condition. Conversely, favorable investor expectations regarding potential investment tax credits or other benefits stemming from the Inflation Reduction Act of 2022IRA may not materialize or could fail to meet expectations.expectations, particularly in light of the rollback to certain IRA provisions by the OBBA.

Increases in the price of diesel or compressed natural gas, or CNG, fuel may adversely affect our collection business and reduce our operating margins.

As a result of our acquisition strategy, we have a material amount of goodwill, indefinite-lived intangibles and property and equipment recorded in our financial statements. We do not amortize our existing goodwill or indefinite-lived intangibles and are required to test goodwill and indefinite-lived intangibles for impairment annually in the fourth quarter of the year and whenever events or changes in circumstances indicate that the carrying value of goodwill and/or indefinite-lived intangible assets may not be recoverable using the one-step process prescribed in the accounting guidance. The process screens for and measures the amount of the impairment, if any. The recoverability of property and equipment is tested for impairment whenever events or changes in facts and circumstances indicate that their carrying amount may not be recoverable. Application of the impairment test requires judgment. A significant deterioration in a key estimate or assumption or a less significant deterioration to a combination of assumptions could result in an additional impairment charge in the future, which could have a significant adverse impact on our reported results.

A portion of our indebtedness is at variable rates which are based on the Canadian Overnight Repo Rate Average, or CORRA, as a result of the transition from the Canadian Dollar Offered Rate, or CDOR, which ceased publication on June 28, 2024. In addition, at December 31, 2024,2025, $550$915 million of our indebtedness, including interest rate swaps, is at variable rates which are based on the term Secured Overnight Financing Rate, or term SOFR, as a result of the transition from the London Interbank Offered Rate, or LIBOR. SOFR and CORRA have a limited history as reference rates, and changes in these rates have, on occasion, been more volatile than changes in other benchmark or market rates. The liquidity of the SOFR and CORRA loan markets could result in higher borrowing costs for us. There could be unanticipated difficulties, disruptions or methodological or other changes with the calculation and publication of these rates, which in turn could trigger another benchmark transition or otherwise cause a reliance on an alternate base rate. This could also result in increased borrowing costs for us and thereby adversely affect our financial condition and earnings.

Our ability to execute our financial strategy and our ability to incur indebtedness is somewhat dependent upon our ability to maintain investment grade credit ratings on our senior debt. The credit rating process is contingent upon our credit profile and several other factors, many of which are beyond our control, including methodologies established and interpreted by third-party rating agencies. If we were unable to maintain our investment grade credit ratings in the future, our interest expense would increase and our ability to obtain financing on favorable terms could be adversely affected.

If we are unable to obtain performance or surety bonds, letters of credit or insurance, we may not be able to enter into additional collection contracts or retain necessary landfill operating permits. Collection contracts, municipal contracts, transfer station operations and landfill closure and post-closure obligations may require performance or surety bonds, letters of credit or other financial assurance to secure contractual performance or comply with federal, state, provincial or local environmental laws or regulations. We typically satisfy these requirements by posting bonds or letters of credit. As of December 31, 2024,2025, we had $2.011$2.157 billion of such surety bonds in place and $170.7$220.6 million of letters of credit issued and outstanding. Closure bonds are difficult and costly to obtain. If we are unable to obtain performance or surety bonds or additional letters of credit in sufficient amounts or at acceptable rates, we could be precluded from entering into additional collection contracts or obtaining or retaining landfill operating permits. Any future difficulty in obtaining insurance also could impair our ability to secure future contracts that are conditional uponon the contractor having adequate insurance coverage. Accordingly, our failure to obtain performance or surety bonds, letters of credit or other financial assurances or to maintain adequate insurance coverage could limit our operations or violate federal, state, provincial, or local requirements, which could have a materially adverse effect on our business, financial condition and results of operations.

AlternativesIncreasing customer preference for alternatives to landfill disposal and bans on certain types of waste may cause our revenues and operating results to decline.

Labor union activity could divert management attentionattention, increase costs, and disrupt operations, thereby adversely affect our operating results.

‎Stakeholder input, business considerations, and potential regulation have reinforced the ‎importance of developing and implementing sustainability and ‎environmental, social, and governance, or ESG, initiatives. In 2020, we ‎adopted long-term, aspirational sustainability targets, which we have since expanded in 2022 and 2023updated; we also committed over $500 million for investments and ‎projects to support these efforts. Our ability to achieve these targets will depend significantly on, among other ‎things, the success of these investments and projects and our ability to meet our financial and ‎operating objectives, which can be impacted by the numerous risks and uncertainties associated with ‎our business and the industry in which we operate. There is a risk that some or all of the expected ‎benefits of these investments and projects may fail to materialize, may cost more to achieve or may ‎not occur within the anticipated time periods, including as a result of limitations on technology, permitting requirements, labor constraints or supply chain disruptions. In addition, there is a risk that the actions taken by us to ‎achieve these targets may have a negative impact on our existing business and increase capital ‎expenditures or decrease investments in other aspects of the business, which could adversely affect our operating results or future growth. Our failure to achieve these targets, ‎or a perception among key stakeholders that such targets are insufficient or unattainable, could ‎damage our reputation, competitive position and share price.‎ ThereWhile isthere increasingcontinues to be interest from many stakeholders in companies developing and implementing more robust ESG policies andpolicies, practices and disclosure around climate-related risk ‎identification and mitigation.mitigation by businesses, initiatives to promote the development and implementation of robust ESG policies and the disclosure of climate related risk are in a state of flux among U.S. federal, state, and Canadian regulators. In the United States, many federal climate change and ESG requirements have stalled, and prospective federal requirements will be determined by litigation or new congressional or regulatory action. Regardless of federal action, certain states have initiated independent state specific programs. In addition, certain investors and lenders are incorporating ESG factors ‎into their investment or lending process, alongside traditional financial considerations.considerations, to varying extents. Developing and ‎implementing policies and practices, and developing additional disclosure in relation to climate change ‎and other environmental and social risk issues, can involve significant costs and require a significant ‎time commitment from our Board of Directors, management and employees. In addition, a failure ‎to implement such policies, practices and disclosure could adversely affect our reputation, competitive ‎position and share price and our ability to raise capital, even if our operating results or prospects have ‎not changed.‎ Furthermore, public statements regarding ESG matters are increasingly subject to scrutiny by regulators, investors and the public. Any actual or perceived “greenwashing”—defined generally as the misrepresentation or exaggeration of ESG or sustainability practices or commitments not adequately supported by measurable actions or outcomes—could result in reputational harm and legal liability, including regulatory enforcement actions, investor lawsuits and consumer claims under securities and consumer protection laws. Finally, should states implement differing requirements, the complexity of compliance could increase our costs and adversely affect our business prospects.

Our success depends significantly on the continued individual and collective contributions of our senior and regional management team. The loss of the services of any member of our senior and regional managementmanagement, the failure of our succession planning to develop an adequate pipeline of future leaders, or the inability to hire and retain experienced management personnel could harm our operating results.

In preparing our consolidated financial statements in accordance with U.S. generally accepted accounting principles, or GAAP, we make estimates and assumptions are made that affect the accounting for and recognition of assets, liabilities, revenues and expenses. TheseWe are required to make these estimates and assumptions must be made because certain information that is used in the preparation of our financial statements is dependent on future events, cannot be calculated with a high degree of precision from data available or is not capable of being readily calculated based on generally accepted methodologies. In some cases, these estimates are particularly difficult to determine and we must exercise significant judgment. The most difficult, subjective and complex estimates and the assumptions that deal with the greatest amount of uncertainty are related to our accounting for landfills, self-insurance accruals, income taxes, allocation of acquisition purchase price, asset impairments and litigation, claims and assessments. Actual results for all estimates could differ materially from the estimates and assumptions that we use, which could have an adverse effect on our financial condition and results of operations.

From time to time, changes in tax laws or regulations may be proposed or enacted that could adversely affect our overall tax liability, including on a retroactive basis. There can be no assurance that changes in tax laws in the United States, Canada and the other jurisdictions in which we operate, such as changes resulting from the increased global focus on issues related to the taxation of multinational corporations, will not materially and adversely affect our effective tax rate, tax payments, financial condition and results of operations. For example, Canada has enacted certain hybrid mismatch rules following recommendations of the Organization for Economic Cooperation and Development (OECD) and has also enacted the Global Minimum Tax Act which, for fiscal years beginning on or after December 31, 2023, implements a minimum effective tax rate of 15% for large multinational groups operating in Canada. SimilarlyCanada has also released draft legislative proposals which propose to implement an additional undertaxed profits rule is proposed to be effective for fiscal years beginning on or after December 31, 2024,2024. whichThe could,OECD announced on January 5, 2026 that the OECD/G20 Inclusive Framework on base erosion and profit shifting has reached agreement on key elements of a “side-by-side” package allowing for continued coordinated operation of Pillar Two global minimum tax arrangements. In light of this agreement, it is not yet clear whether Canada will proceed with such draft legislation to implement the undertaxed profits rule or whether it will delay the currently proposed effective date. Furthermore, in certain circumstances, apply a top-up tax on certain low-taxed income. Furthermore, the approachU.S., thatCongress’ willresponse be taken by U.S. Congress towardsto the OECD recommendations and other matters continues to evolve, and tax changes, including, for example, due to legislation commonly referred to as the Tax Cut and Jobs Act, may also impact our tax exposure and may have a material adverse effect on our financial position, results of operations, and cash flows.

We are increasingly dependent on technology, including through the use of Artificial Intelligence (AI),technology in our operations and a failure of our technology could impact our ability to service our customers and adversely affect our financial results, damage our reputation, and expose us to litigation risk.

If we are not able to adapt and effectively incorporate potential advantages of AI in our business, it may negatively impact our ability to compete. On the other hand, if we are not able to effectively manage the commercial and legal risks of AI, including the potential for poor or inconsistent quality, privacy concerns, risks related to automated decision-making, and the potential for exposure of confidential and/or propriety information, we may suffer harm to our results of operation and reputation. In addition, theThe development, adoption, and commercial use of generative AI technologies are still in their early stages and ineffective or inadequate AI development or deployment practices by us or our third-party developers or vendors could result in unintended consequences. Developing, testing, and deploying resource-intensive AI systems may require additional investment and increase our costs. Commercial use of AI is subject to a complex and evolving regulatory landscape, and the technologies underlying AI and its uses are the subject of ongoing review by various government and regulatory agencies. Compliance with these developing regulations may be complex, costly and time-consuming, and there is a risk of regulatory enforcement or litigation if we fail to comply with these requirements.

If we are not able to develop new service offerings and protect intellectual property, or if a competitor develops or obtains exclusive rights to a breakthrough technology, our financial results may suffer.

Governmental authorities and various interest groups in the United States and Canada have implemented laws and regulations designed to limit GHG emissions in response to growing concerns regarding climate change. For example, the State of California, the Canadian federal government and several Canadian provinces have enacted climate change laws, and other states and provinces in which we operate are considering similar actions. The EPA made an endangerment finding in 2009 allowing certain GHGs to be regulated under the CAA. This finding allowsWhile the EPATrump administration is seeking to createroll back this finding, the EPA’s prior regulatory actions created regulations that will impact our operations – includingby imposing emission reporting, permitting, control technology installation and monitoring requirements, although the materiality of the impacts will not be known until all applicable regulations are promulgated and finalized.finalized, including following any regulatory appeals. The Canadian federal government enacted the Greenhouse Gas Pollution Pricing Act in June 2018, which established a national carbon-pricing regime starting in 2019 for provinces and territories in Canada where there is no provincial regime in place or where the provincial regime does not meet the federal benchmark. The Canadian Government recently proposedenacted additionalnew regulations regardingthat will restrict methane emissions from landfills,certain asMSW well as a GHG cap on emissions from the oil and gas sector.landfills. Several Canadian provinces have promulgated legislation and regulations to limit GHG emissions through requirements of specific controls, carbon levies, cap and trade programs or other measures. The EPA identified methane emissions from landfills and from oil and gas facilities as a focus for enforcement and compliance resources in its National Enforcement and Compliance Initiatives for 2024 through 2027. Comprehensive GHG legislation or regulation, including carbon pricing, affects not only our business, but also that of our customers. The State of California enacted Senate Bill 219 in 2024, requiring companies with revenues exceeding $1 billion and operating within California to report Scope 1 and Scope 2 emissions beginning in 2026 (for emissions occurring in fiscal year 2025) and Scope 3 emissions beginning in 2027 (for emissions occurring in fiscal year 2026). Companies disclosing emissions in California must obtain formal assurance from approved data verification firms to ensure regulatory compliance.

We may be subject in the normal course of business to judicial, administrative or other third-party proceedings that could interrupt or limit our operations, require expensive remediation, result in adverse judgments, settlements or fines and create negative publicity.publicity, which could damage our reputation.

Governmental agencies may, among other things, impose fines or penalties on us relating to the conduct of our business, attempt to revoke or deny renewal of our operating permits, franchises or licenses for violations or alleged violations of environmental laws or regulations or as a result of third-party challenges, require us to install additional pollution control equipment or require us to remediate potential environmental problems relating to any real property that we or our predecessors ever owned, leased or operated or any waste that we or our predecessors ever collected, transported, disposed of or stored. For example, see the discussion regarding the Elevated Temperature Landfill Event in Note 13, “Commitments and Contingencies,” of our consolidated financial statements included in Item 8 of this Annual Report on Form 10-K. Individuals,While citizenswe groups,do tradenot associationsprovide hazardous waste collection, transfer or environmentaldisposal activistsservices, our failure to strictly follow federal, state, provincial or local laws regulating the collection, storage, treatment or transportation of listed or characteristically hazardous substances may also bring actions againstsubject us into connectionregulatory withenforcement ouractions, currentfines or formerother operations that could interrupt or limit the scope of our business or result in adverse judgments or settlements requiring substantial payments. For example, see the discussions regarding the Jefferson Parish, Louisiana Landfill Litigation, Chiquita Canyon Landfill Civil Litigation, and County of Los Angeles Litigation in Note 13, “Commitments and Contingencies,” of our consolidated financial statements included in Item 8 of this Annual Report on Form 10-K.liability. Any adverse outcome in such proceedings could harm our operations and financial results and create negative publicity, which could damage our reputation, competitive position and share price.

We are, and from time to time become, involved in lawsuits, regulatory inquiries, and governmental and other legal proceedings arising out of the ordinary course of our business. Many of these matters raise complicated factual and legal issues and are subject to uncertainties and complexities, all of which make the matters costly to address. For example, in recent years, wage and employment laws have changed regularly and become increasingly complex, which has fostered litigation, including purported class actions. Similarly, purported class actions based on claims related to allegedly unlawful landfill odors and rates and fees charged under certain contracts for collection services have proliferated, as have citizen suits brought pursuant to environmental laws, such as those regulating the treatment of storm water runoff. Individuals, citizens groups, trade associations, environmental activists or governmental entities may also bring actions against us in connection with our current or former operations that could interrupt or limit the scope of our business. The timing of the final resolutions to lawsuits, regulatory inquiries, and governmental and other legal proceedings is uncertain. Additionally, the possible outcomes or resolutions to these matters could include adverse judgments or settlements, either of which could require substantial payments, adversely affecting our consolidated financial condition, results of operations and cash flows. See discussion in Note 13, “Commitments and Contingencies,” of our consolidated financial statements included in Item 8 of this Annual Report on Form 10-K.

The solid waste industry is local and highly competitive in nature, requiring substantial labor and capital resources. We compete for collection accounts primarily on the basis of price and, to a lesser extent, the quality of service, and compete for landfill business on the basis of tipping fees, geographic location and quality of operations. The solid waste industry has been consolidating and continues to consolidate as a result of a number of factors, including the increasing costs and complexity associated with waste management operations and regulatory compliance. ManySome small independent operators and municipalities lack the capital resources, management, operating skills and technical expertise necessary to operate effectively in such an environment. The consolidation trend has caused solid waste companies to operate larger landfills that have complementary collection routes that can use company-owned disposal capacity. ControllingOwning thea point of transfer from haulers to landfills has become increasingly important as landfills continue to close and some disposal capacity movesis farther from the collection markets it serves.areas.

We generally seek to avoid highly competitive, large urban markets and instead target markets where we can attainoperate highefficiently, marketincluding sharesecondary eitherand rural markets, which often allows us to establish a substantial presence and operate profitably through exclusive contracts, vertical integration or asset positioning. In markets where waste collection services are provided under exclusive arrangements, or where waste disposal is municipally owned or funded or available at multiple municipal sources, we believeseek thatto controllingachieve theefficiencies wastethrough stream by providingour collection services underthat exclusive arrangements is often more important toaid our growth and profitability than owning or operating landfills.profitability. We also target niche markets, like non-hazardous E&P waste treatment, recovery and disposal services.

The functional currency of the Company, as the parent corporate entity, and its operating subsidiaries in the United StatesStates, is the U.S. dollar. The functional currency of the Company’s Canadian operations is the Canadian dollar. The reporting currency of the Company is the U.S. dollar. The Company’s consolidated Canadian dollar financial position is translated to U.S. dollars by applying the foreign currency exchange rate in effect at the consolidated balance sheet date. The Company’s consolidated Canadian dollar results of operations and cash flows are translated to U.S. dollars by applying the average foreign currency exchange rate in effect during the reporting period. The resulting translation adjustments are included in other comprehensive income or loss. Gains and losses from foreign currency transactions are included in earnings for the period.

Revenues in 20242025 increased 11.2%6.1% to $9.467 billion from $8.920 billion from $8.022 billion in 2023.2024. Acquisitions closed during, or subsequent to, the prior year, net of divestitures, accounted for $529$377.2 million in incremental revenues in 2024.2025. Excluding the impact of such acquisitions, revenues increased 4.6%1.9% due predominantly to higher internal growth in solid waste. Solid waste internal growth was up 4.4%,2.3%, due to higher price increases and higher recycled commodities,increases, partially offset by lowerdeclines surchargesin surcharges, volumes and lowerrecycled volumes.commodities, along with the closure of an operating facility at year-end 2024. Pricing growth was 6.6%,6.4%, with core pricing up 7.1%,6.5%, with offsets from lower materials and environmental surcharges of 0.5%.0.1%. Volumes decreased by 2.9%2.8% due primarily to the intentional shedding of lower quality revenue, including through the purposeful non-renewal of certain residential hauling contracts,contracts. partiallyAdditionally, offsetinternal solid waste growth declined by increases0.8% inas a result of the quantityfacility closure and value0.5% as a result of decreases in recycled commodities ofrevenue. 0.7%. In addition, overall growth included 0.3% from increasedHigher E&P waste activity andcontributed 0.3%0.2% fromto increasesoverall ingrowth, which was offset by lower landfill gas sales, including renewable energy credits, and other revenue.revenue, Foreigndown 0.2%, and foreign exchange impacts resulted in a 0.2%0.3% decrease to overall growth.

Net income attributable to Waste Connections decreasedincreased 19.0%74% to $1.077 billion in 2025, from $617.6 million in 2024, from $762.8 million in 2023, principally as a result of impairments and other operating items, which increaseddecreased to $109.7 million in 2025 from $613.0 million in 2024 from $238.8 million in 2023.2024. In 2024,2025, adjusted earnings before interest, taxes, depreciation and amortization, or adjusted EBITDA, a non-GAAP financial measure (refer to page 7674 of this Annual Report on Form 10-K for a definition and reconciliation to Net income attributable to Waste Connections), increased 15.0%7.7% to $2.902$3.125 billion, from $2.523$2.902 billion in 2023.2024. As a percentage of revenue, adjusted EBITDA increased from 31.5% in 2023, to 32.5% in 2024.2024, to 33.0% in 2025. This 1.00.5 percentage point increase reflects price-led organic growth in solid waste exceeding cost inflation and lower cost of fuel during the year, alongpartially withoffset higherby lower recycled commodity, E&P wastecommodity and landfill gas revenues. Adjusted net income attributable to Waste Connections, a non-GAAP financial measure (refer to page 7775 of this Annual Report on Form 10-K for a definition and reconciliation to Net income attributable to Waste Connections), in 20242025 increased 14.6%7.2% to $1.328 billion from $1.239 billion from $1.081 billion in 2023.2024.

In 2024,2025, we distributed $302.3$839.3 million to shareholders through a combination of cash dividends and share repurchases. We paid $333.8 million to shareholders through cash dividends declared by our Board of Directors, which also increased the quarterly cash dividend by 10.5%,11.1%, from $0.285$0.315 to $0.315$0.350 per common share in October 2024.2025. Cash dividends increased $31.7$31.5 million, or 11.7%,10.4%, from $270.6$302.3 million in 20232024 due to ana 11.8%10.5% increase in the quarterly cash dividend declared by our Board of Directors in October 2023,2024, followed by the additional increase in October 2024.2025 and reflects the reduced share count resulting from repurchases. In 2025, we also repurchased 2.8 million common shares at an aggregate cost of $505.5 million pursuant to our normal course issuer bid, which was renewed in August 2025 and provides for repurchases of up to 12,855,691 shares, being 5% of the shares outstanding as of July 31, 2025. Our Board of Directors intends to review the quarterly dividend during the fourth quarter of each year, with a long-term objective of increasing the amount of the dividend. We expect the amount of capital we return to shareholders through share repurchases to vary depending on our financial condition and results of operations, capital structure, the amount of cash we deploy on acquisitions, expectations regarding the timing and size of acquisitions, the market price of our common shares, and overall market conditions. We cannot assure as to the amounts or timing of future dividends or share repurchases. We have the ability under our Revolving Credit Agreement to repurchase our common shares and pay dividends provided that we maintain specified financial ratios.

We target a Leverage Ratio, as defined in our Revolving Credit Agreement, of approximately 2.5x – 3.0x total debt to EBITDA. The Leverage Ratio is a non-GAAP ratio (refer to page 7775 of this Annual Report on Form 10-K for more information on this ratio). Higher debt resulting from acquisitionoutlays outlaysfor acquisitions and share repurchases during 20242025 were largely offset by higher EBITDA in 2024,2025, resulting in a nominal increase in our Leverage Ratio from 2.60x at December 31, 2023 to 2.67x at December 31, 2024.2024 to 2.75x at December 31, 2025. Cash balances decreased from $78.4 million at December 31, 2023 to $62.4 million at December 31, 2024,2024 to $46.0 million at December 31, 2025, and we had $778$581.1 million of remaining borrowing capacity under our Revolving Credit Agreement, which matures in February 2029. In total, we had $1.364$2.2 billion in prepayable debt outstanding at December 31, 2024.2025.

Final capping, closure and post-closure obligations. We accrue for estimated final capping, closure and post-closure maintenance obligations at the landfills we own, and the landfills that we operate, but do not own, under life-of-site agreements. We could have additional material financial obligations relating to final capping, closure and post-closure costs at other disposal facilities that we currently own or operate or that we may own or operate in the future. Our discount rate assumption for purposes of computing 20242025 and 20232024 “layers” for final capping, closure and post-closure obligations is based on our long-term credit adjusted risk freerisk-free rate. Our discount rate was 5.50% for each of 20242025 and 2023.2024. Our long-term inflation rate assumption was 2.75% for each of the years ended December 31, 20242025 and 2023.2024. Significant reductions in our estimates of the remaining lives of our landfills or significant increases in our estimates of the landfill final capping, closure and post-closure maintenance costs could have a material adverse effect on our financial condition and results of operations. In the event that changes in an estimate for a closure and post-closure liability are associated with a significant change in facts and circumstances at a landfill or a non-operating section of a landfill, corresponding adjustments to recorded liabilities and Impairments and other operating items are made as soon as is practical. In 2023, we recorded an additional $159.5 million of charges to adjust the carrying value of a closure and post-closure liability at an area of a landfill site that has been deemed to reach final capacity. Furthermore, during the quarter ended December 31, 2024, we recorded an additional $480.8 million of charges to adjust the carrying value of the closure and post-closure liability at the same landfill, which ceased active waste disposal operations as of December 31, 2024. Additionally, changes in regulatory or legislative requirements could increase our costs related to our landfills, resulting in a material adverse effect on our financial condition and results of operations.

We capitalize some third-party expenditures related to development projects, such as information technology, legal and engineering. We expense all third-party and indirect acquisition costs, including third-party legal and engineering expenses, executive and corporate overhead, public relations and other corporate services, as we incur them. We charge against net income any unamortized capitalized expenditures and advances (net of any portion that we believe we may recover, through sale or otherwise) that may become impaired, such as those that relate to any operation that is permanently shut down and any landfill development project that we believe will not be completed. We routinely evaluate all capitalized costs, and expense those related to projects that we believe are not likely to succeed. For example, if we are unsuccessful in our attempts to obtain or defend permits that we are seeking or have been awarded to operate or expand a landfill, we will no longer generate anticipated income from the landfill and we will be required to expense in a future period up to the carrying value of the landfill or expansion project, less the recoverable value of the property and other amounts recovered.

Operations that were divested induring, 2024or andsubsequent to, the full year impactended ofDecember operations31, that were divested in 2023,2024, decreased revenues by $8.1$10.7 million,million for the year ended December 31, 2024.2025.

During the year ended December 31, 2024,2025, we recognized volume losses totaling $222.5$238.0 million,million resulting from a decrease in roll off volumes, lower post-collection volumes in our Eastern, Southern and Central segments, lower residential collection volumes due primarily to the purposeful shedding of certain low-margin municipal contracts in our Southern, Eastern and Canada segments, lower commercial revenues and a decrease in roll off volumes.revenues.

E&P waste revenues at facilities owned during the yearsyear ended December 31, 2024 and 20232025 increased $25.3$17.6 million, due to nominal increases in overall demand for our E&P waste services as a result of increases in drilling and production activity levels in certainour basins.Canada segment.

Revenues from sales of recyclable commodities at facilities owned during the years ended December 31, 20242025 and 20232024 increaseddecreased $54.0$37.7 million. The increasedecrease was primarily attributable to higherlower average commodity pricingprices for old corrugated cardboard and other paper products as compared to the prior period.plastics.

Other revenues increaseddecreased $20.1$15.8 million during the year ended December 31, 2024,2025, due primarily to a $24.9$13.6 million increasedecrease in landfill gas revenues on higherlower values forof renewable energy credits and highera landfill$3.1 gasmillion volumesdecrease andin intermodal revenues, partially offset by a $2.1$0.9 million increase in other non-core revenue sources, partially offset by a $6.9 million decrease in intermodal revenues.sources.

Cost of operations as a percentage of revenues decreased 0.90.6 percentage points to 57.6% for the year ended December 31, 2025, from 58.2% for the year ended December 31, 2024, from 59.1% for the year ended December 31, 2023.2024. The decrease as a percentage of revenues was primarily driven by the impact of price-led revenue growth, contributionsa from0.4 anpercentage increasepoint decrease in higherdisposal landfillcosts gas sales,as a 0.4result of increased internalization in certain markets, a 0.2 percentage point decrease due to the impact of acquisitions having lower operating costs as a percentage of revenue as compared to existing operations,operations and a 0.40.2 percentage point decrease in fuel costs due to lower diesel andprices, naturalpartially gasoffset prices,by a 0.2 percentage point decrease in disposal costs due to increased internalization in certain markets, a 0.2 percentage point decrease in subcontract costs and a 0.1 percentage point decrease due to lower costs associated with other expenses, partially offset by a 0.4 percentage point increase in risklabor managementand expenses.benefits costs.

SG&A. SG&A expenses increased $84.3$76.1 million, or 10.6%,8.6%, to $959.5 million for the year ended December 31, 2025, from $883.4 million for the year ended December 31, 2024, from $799.1 million for the year ended December 31, 2023.2024. The increase was comprised of an increase of $48.0$53.1 million, assuming foreign currency parity, at our existing operations and $37.7$25.2 million from acquisitions closed during, or subsequent to, the year ended December 31, 2023,2024, partially offset by a decrease of $1.4$2.2 million resulting from a lower average foreign currency exchange rate in effect during the current period.

The increase in SG&A expenses at our existing operations of $48.0$53.1 million, assuming foreign currency parity, for the year ended December 31, 20242025 was comprised of an increase in administrative payroll expenses of $15.7$32.7 million, anhigher increaseincentive incompensation direct acquisition expensesexpense of $15.4$9.6 million due to an increase in acquisition activity in the current period,million, an increase in professional fees of $11.5 million, a collective increase in travel, meetings and training expenses of $9.0 million, an increase in incentive compensation expense of $4.8 million, an increase in benefits costs of $3.2$7.2 million and $4.5$3.6 million of other net expense increases, partially offset by a decrease in executive separation costs of $16.1 million.increases.

AmortizationSG&A of intangibles expenseexpenses as a percentage of revenues increased 0.10.2 percentage points to 2.1%10.1% for the year ended December 31, 2024,2025, from 2.0%9.9% for the year ended December 31, 2023.2024. The increase as a percentage of revenues was primarily attributabledriven toby a 0.3 percentage point increase in administrative payroll and incentive compensation expenses, partially offset by a 0.1 percentage point decrease in SG&A expenses from acquisitions closed during, or subsequent to, the year ended December 31, 2023 having higher amortization expense as a percentage of revenue than our company average, partially offset by price-driven revenue increases in our solid waste services.2024.

Impairments and Other Operating Items. Impairments and other operating items increaseddecreased $374.2$503.3 million, to net losses totaling $109.7 million for the year ended December 31, 2025, from net losses totaling $613.0 million for the year ended December 31, 2024, from net losses totaling $238.8 million for the year ended December 31, 2023.2024.

During and prior to the year ended December 31, 2024, we worked to address regulatory constraints related to the active waste disposal operations that were preventing our Chiquita Canyon Landfill (“Chiquita”) from continuing to receive and manage waste from its customers. The primary constraints were tonnage limitations effective January 1, 2025 and the final permit approval needed for Chiquita to access otherwise permitted and constructed airspace. Without any resolution of these matters, we determined it was no longer economically feasible to operate Chiquita and made the decision to cease active waste disposal operations as of December 31, 2024. As a result, it became necessary to record charges of $480.8 million to adjust the carrying value of the landfill closure and post-closure liability and record an impairment charge of $116.1 million to adjust the carrying value of the landfill. See “Accounting for landfills” and “Final capping, closure and post-closure obligations” within “Critical Accounting Estimates and Assumptions” included in this Item 7 of Part II – “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Operating Income. Operating income decreasedincreased $168.7$642.5 million, or 13.6%,60.2%, to $1.710 billion for the year ended December 31, 2025, from $1.068 billion for the year ended December 31, 2024, from $1.236 billion for the year ended December 31, 2023.2024.

The decreaseincrease in our operating income for the year ended December 31, 20242025 was due primarily to an increase in impairments and other operating items, an increase in risk management costs and an increase in direct acquisition expenses associated with increased acquisition activity as compared to the prior year period, partially offset by price increases for our solid waste services, a decrease in impairments and other operating items, and operating income generated from acquisitions closed during, or subsequent to, the year ended December 31, 2023,2024, contributionspartially fromoffset higherby recyclablelower commodity pricing, operating income contributions from increased renewable energy credits associated with the generation of landfill gas,volumes, an increase in earningslabor atand ourrecurring E&Pincentive wastecompensation expenses and the impact of operations andthat lowerwere executiveclosed separationduring, costs.or subsequent to, the year ended December 31, 2024.

Operating income as a percentage of revenues decreasedincreased 3.46.1 percentage points to 18.1% for the year ended December 31, 2025, from 12.0% for the year ended December 31, 2024, from 15.4% for the year ended December 31, 2023.2024. The decreaseincrease as a percentage of revenues was comprised of a 3.95.7 percentage point increasedecrease in impairments and other operating items, a 0.4 percentage point increase in depreciation expenseitems and a 0.1 percentage point increase in amortization expense, partially offset by a 0.90.6 percentage point decrease in cost of operationsoperations, andpartially offset by a 0.10.2 percentage point decreaseincrease in selling, general and administrative expenses.

Interest Expense. Interest expense increased $52.2$7.8 million, or 19.0%,2.4%, to $334.6 million for the year ended December 31, 2025, from $326.8 million for the year ended December 31, 2024, from $274.6 million for the year ended December 31, 2023.2024. The increase was primarily attributable to an increase of $32.2$15.1 million from the issuance of $750.0$500.0 million of senior unsecured notes during the year ended December 31, 2024,2025, an increase of $8.9$7.2 million from the issuance of CAD $500.0 million of senior unsecured notes duringin the yearprior ended December 31, 2024,period, an increase of $8.7$5.3 million from the issuance of $750.0 million of senior unsecured notes in the prior period and an increase of $4.2 million due to an increase in thehigher average borrowings outstanding under our credit facilities during the year ended December 31, 2024 and $3.2 million of other net expense increases,2025, partially offset by a decrease of $0.8$22.1 million from lower interest rates on borrowings outstanding during the comparable periods.periods and a decrease of $1.9 million from other net expense decreases.

Interest Income. Interest income increased $2.2$0.5 million, or 24.1%,4.6%, to $12.1 million for the year ended December 31, 2025, from $11.6 million for the year ended December 31, 2024, from $9.4 million for the year ended December 31, 2023.2024. The increasesincrease werewas primarily attributable to higher average investment rates in the current periods.period.

Other Income, Net. Other income, net decreasedincreased $2.0$19.7 million, or 16.1%,188.0%, to an$30.2 incomemillion totalfor ofthe year ended December 31, 2025, from $10.5 million for the year ended December 31, 2024, from an income total of $12.5 million for the year ended December 31, 2023.2024.

Income Tax Provision. Income taxes decreasedincreased $74.3$195.0 million, to $341.4 million for the year ended December 31, 2025, from $146.4 million for the year ended December 31, 2024,2024. fromOur $220.7effective milliontax rate for the year ended December 31, 2023.2025 was 24.1%. Our effective tax rate for the year ended December 31, 2024 was 19.2%. Our effective tax rate for the year ended December 31, 2023 was 22.4%.

We manage our operations through the following six geographic solid waste operating segments: Southern, Western, Southern, Eastern, Central, Canada and MidSouth. Our six geographic solid waste operating segments comprise our reportable segments. Each operating segment is responsible for managing several vertically integrated operations, which are comprised of districts. Certain corporate or regional overhead expense allocations may affect comparability of the segment information presented herein on a period-over-period basis.

Revenue increased $129.4$150.6 million to $1.799$1.908 billion for 2025, from $1.757 billion for 2024, from $1.669 billion for 2023, due to price increases, contributions from acquisitions, price increases in residential and roll off collection volumes and an increase in landfill gas sales, partially offset by lower commercial and residential collection volumes, a decrease in roll off volumes, lower E&P waste revenues attributable to decreases in drilling and production activity and a decrease in recyclable commodity revenues as compared to the prior period due to an increase in commodity values, partially offset by decreased intermodal revenue.period.

Environmental, organizational and financial sustainability initiatives have been key components of our success since we were founded in 1997. We continuously monitor and evaluate new technologies and investments that can enhance our commitment to the environment, to our employees and to the communities we serve. We have committed $500 million to the advancement of long-term, aspirational ESGsustainability targets, which we evaluate continuously and have expanded as we make progress towards their achievement. Our targets align with our focus on value creation for our stakeholders, and we have incorporated progress towards their achievement into compensation metrics. Our ESGsustainability targets include reduced absolute Scope 1 and 2 emissions and emissions intensity, expanded resource recovery processing, increased landfill gas recovery and beneficial reuse, increased on-site leachate treatment at our landfills, and improved metrics for safety and employee engagement.

RESULTS OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED MARCHJUNE 31,30, 2026 AND 2025 The following table sets forth items in our Condensed Consolidated Statements of Net Income in thousands of U.S. dollars and as a percentage of revenues for the periods indicated.

IncomeRevenues. TaxTotal Provision.revenues Incomeincreased taxes decreased $7.3$154.6 million, or 6.4%, to $64.2$2.562 millionbillion for the three months ended MarchJune 31,30, 2026, from $71.5$2.407 millionbillion for the three months ended MarchJune 31,30, 2025. OurTotal effectiverevenues taxincreased rate$297.0 million, or 6.4%, to $4.932 billion for the threesix months ended MarchJune 31,30, 20262026, wasfrom 22.6%.$4.635 Our effective tax ratebillion for the threesix months ended MarchJune 31,30, 2025 was 22.8%.2025.