investor presentation april 2014

Investor Presentation April 2014

Forward Looking Statements

This presentation includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend,“

"plan," "may," "will," "could," "should," "believes," "predicts," "potential," and "continue" or variations of such words, other similar words or similar expressions are intended to identify such forward-looking statements. These forward-looking statements may include, without limitation, statements relating to future financial and operating results, our financial condition and our plans, objectives, prospects, expectations and intentions. These forward-looking statements involve significant risks and uncertainties and other factors and assumptions that could cause actual results to differ materially from the forward-looking statements. Most of these factors and assumptions are outside of our control and are difficult to predict. In addition to the factors and assumptions contained in this presentation, the following factors and assumptions, among others, could cause or contribute to such material differences: downturns in the worldwide economy; our ability to realize all of the anticipated benefits of future acquisitions; our ability to obtain, renew and maintain certain permits, licenses and approvals relating to our landfill operations; and fuel cost and commodity price fluctuations. Additional factors and assumptions that could cause Progressive Waste Solutions Ltd.'s results to differ materially from those described in the forward-looking statements can be found in the most recent annual information form under the heading “Risk Factors”. Progressive Waste Solutions Ltd. cautions that the foregoing list of factors is not exclusive and that investors should not place undue reliance on such forward-looking statements. All subsequent written and oral forward-looking statements concerning Progressive Waste Solutions Ltd., or other matters attributable to Progressive Waste Solutions Ltd. or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Progressive Waste Solutions Ltd. does not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this communication, except as required by applicable law. 2

Snapshot

• One of the largest solid waste management companies in N.A.

• Over 4 million Commercial, Industrial and Residential customers

• Top 3 market share position by number of collection routes in over 80% of the

markets in which we operate

• Strong vertically integrated asset base in the U.S. and Canada with significant

and strategic landfill internalization rates

• More than 7,500 employees

• Quarterly cash dividend of $0.15 per share ($0.60/share annually)

• Listed on the NYSE & TSX : “BIN”

3

Industry Dynamics

• $60 billion+ industry in N.A. with scale concentrated in top four players • Essential service with multi-year contracts • Strong and predictable cash flow • Recession resistance with operating leverage to an economic recovery due to high fixed

cost infrastructure (typically a late-cycle performer) • Assets are underutilized, presenting margin expansion opportunity • Competitive dynamics vary by local market and success is driven by local market

customer density and asset mix • Top players represent ~36% of industry revenues with many further consolidation

opportunities remaining • Industry growth driven by price and volume improvements, with recycling and waste

diversion growth creating new revenue opportunities

4

Consistent Strong Results

5

$170 $208

$257 $291 $292

$416

$535 $520 $531

2005 2006 2007 2008 2009 2010 2011 2012 2013

$559 $680

$854 $1,047 $1,008

$1,430

$1,840 $1,897 $2,026

2005 2006 2007 2008 2009 2010 2011 2012 2013

Revenue

US $MM

$48 $50 $64 $95

$119

$194

262.5

172.5 191

2005 2006 2007 2008 2009 2010 2011 2012 2013

Adjusted EBITDA(A)

US $MM

Free Cash Flow (B) US$MM

Revenue 5-year CAGR is 14.2% Adjusted EBITDA(A) 5-year CAGR is 12.8% Free Cash Flow(B) 5-year CAGR is 15.6%

$199(1)

(A) Please refer to the definition and explanation of (A) on slide 34. (B) Please refer to the definition and explanation of (B) on slide 37. (1) Free cash flow excluding $38.6 million and $26.1 million on discretionary infrastructure projects in 2013 and 2012 respectively.

2012 includes $30 MM revenue & EBITDA impact of lower recycled

commodities prices

$230(1)

6

Q1 2014 CEO Highlights • We continued to make progress on our operational plan despite challenging weather conditions, and, given the resumption of normal seasonal activities in April, we are reaffirming our 2014 outlook on all measures • Achieved consolidated pricing growth of 1.9% – best price performance since 2010

• Despite lower level of adjusted EBITDA(A) than anticipated due to delayed disposal volumes, generated higher free cash flow(B) of $48.7MM, representing 10.4% of consolidated revenues

• We remain focused on our priorities for 2014: Operational execution and optimizing the use of our free cash flow(B) to create value

(A) Please refer to the definition and explanation of (A) on slide 34. (B) Please refer to the definition and explanation of (B) on slide 37.

Operating Model for Continuous Improvement

7

Business model drives improvement

year-over-year

Build dense collection network organically or by acquisition Revenue/hour

Balance with franchise markets Complement with strategic

landfills Drive internalization

opportunities

Decentralized decision-making Local market execution and accountability

Goal oriented and execution to a result Performance driven by metrics Commitment to year over year performance improvement

Critical mass matters Density drives productivity Strategic plans that drive

revenue and EBITDA per asset up year over year

Year over year ROC improvement

Culture Passion Training Teamwork

Transfer station

Material recovery

Recycled goods

Landfill

Gas-to-Energy Plant

Natural Gas Electricity

Organics, yard & landscape waste

Home Heating Compost

Anaerobic Digester

Solid Waste

Integrated Assets Support Operating Strategy

•Market focused strategy •Leading collection operations in dense urban markets •Strategically located landfills in close proximity to urban markets

120 non-hazardous

solid waste collection operations

72 transfer

stations* strategically located near

many collection

routes

47 material recovery facilities* process a variety of materials

*Owned and / or operated

31 landfill sites*

5 gas-to-energy systems

Positioning Asset Base for the Future

• Integrated assets are critical. – The right combinations of collection, recycling, transfer and disposal assets

provide operating leverage

• Acquisitions can contribute incremental operating leverage. – ‘Tuck-in’ collection companies that integrate into existing routes and assets

can help achieve higher route density and landfill internalization

• The right assets, at the right price, will position our company for future success. – Strategic assets, including acquisitions and internal infrastructure projects,

both collection and post-collection, need to meet our measures for return on invested capital

9

Focusing on Operational Execution

• Management focused on internal execution. – Drive productive organic growth – Maintain an optimized cost structure

• Sales initiatives are taking hold. – Upgraded field sales teams – Added strategic price management tools and field sales training programs

• Positioned well for the longer term.

– Serve higher growth, open markets that are most levered to an economic recovery

– Opportunity to continue to grow in the markets we serve

10

Committed to Improving Return on Invested Capital

• Focused on the disciplined investment of free cash flow(B), with the goal of improving our return on invested capital (“ROIC”).

• Deploying cash to generate the highest available returns for our shareholders.

• Compensation programs directly tied to improving ROIC at the company level.

11 (B) Please refer to the definition and explanation of (B) on slide 37.

Capital Expenditures

12

As a % of revenue: Replacement Growth

61% 71%

74% 70% 72% ~86% 39%

29%

26%

30% 28% ~15%

2009 2010 2011 2012 2013 2014

Growth

Replacement $171

$220(1)

$143

$USD (MM) 2014 CAPEX • Expect total CAPEX to

be between $212 - $216MM.

• Also reflects proceeds from asset sales.

2014 Replacement CAPEX • Includes capital for

construction at Seneca Meadows landfill for utility relocation.

2013 Growth CAPEX • Includes capital related to

municipal contract wins and organic growth.

$122

2.9% 4.8% 2.4% 7.0% 7.3% 6.9%

(1) Does not include internal infrastructure investments of $26.5MM and $38.6MM in 2012 and 2013, respectively. 2014 does not include anticipated infrastructure investments of $20MM.

$235(1)

3.5% 8.2%

~$212 – $ 216(1)

3.3% 8.3%

2014 Capital Allocation

• Focused on the optimal allocation of our cash • Target long-term leverage between 2.5x – 3.0x

– Total long-term debt is $1.54B at March 31, 2014 vs. $1.55B at December 31, 2013

– Funded debt to EBITDA, as defined and calculated in accordance with our consolidated facility, was 2.91x at March 31, 2014

– Comfortable with current leverage level and believe optimal long-term leverage range for the Company is between 2.5x and 3.0x

• Balance sheet stability combined with strong levels of free cash flow provide

flexibility to direct capital where we expect to generate the most value

13

Progressive Waste Solutions Priorities

1. Optimization of asset base, including post-collection, to position for the

future. Investments in assets will be strategic, not thematic, and need to meet our

measures for return on invested capital

2. Operational execution to deliver organic growth and cost efficiency. Continued focus on internal execution at the field level to drive productive

organic growth and maintain an optimized cost structure

3. Disciplined deployment of capital to improve ROIC. Strict oversight of replacement and growth capital Allocation of free cash flow to generate the highest available returns for our

shareholders

14

Appendix

Q1 2014 Financial Highlights

$U.S. MM Except per share amounts Q1/14 Q1/13 QoQ

Canada $167.4 $179.1 (6.6%)

U.S. south $221.9 $211.6 4.9%

U.S. northeast $80.5 $95.9 (16.0%)

Total Revenues $469.8 $486.6 (3.5%)

Adjusted Net Income(A)

Reported Net Income $24.8 $25.9

$27.1 $29.3

(8.7%) (11.7%)

Adjusted EPS(A) (diluted) Reported EPS (diluted)

$0.21 $0.23

$0.24 $0.25

(10.5%) (12.0%)

Adjusted Operating EBIT(A) $42.6 $58.4 (27.0%)

Adjusted EBITDA(A) $112.9 $129.1 (12.5%)

Adjusted EBITDA(A) Margins 24.0% 26.5% (250bps)

Adjusted EBITA(A) $59.6 $73.1 (18.5%)

Free Cash Flow(B) $48.7 $44.9 8.6%

Weighted Average Share Count 115,177 115,167

Total Actual Outstanding Share Count 115,180 115,167

16 (A) Please refer to the definition and explanation of (A) on slide 34. (B) Please refer to the definition and explanation of (B) on slide 37.

Q1 2014 Revenue Growth

1) Price reflects organic average price change, net of rollbacks and excludes fuel surcharges, across the Company’s customer base. 2) OCC average price based on RISI pricing weighted to the company’s regions in Q1/14 equaled $111 (vs. Q1/13 = $99/ton). 3) Q1 /14 Canadian volume decline reflects the impact of harsh weather conditions. We note that the Q1/14 impact to volume from Calgary landfill closure to MSW in mid 2013

was mitigated as volume increased at our transfer station which opened in 2013 to accept volume that would have otherwise been received at our Calgary landfill site. 4) U.S. volume decline reflects the impact of Sandy volume received in Q1/13. This resulted in a negative volume impact of (270 bps) to U.S. volume and (165 bps) to consolidated

company volume.

Components of Revenue Growth (Decline)

CAN Q1/13

U.S. Q1/13

Total Company

Q1/13

CAN Q1/14

U.S. Q1/14

Total Company

Q1/14

Price(1) 0.9% 1.4% 1.2% 2.5% 1.5% 1.9%

Fuel Surcharges 0.1% 0.4% 0.3% - (0.2%) (0.1%)

Recycling and Other(2) (1.0%) (0.1%) (0.5%) 0.9% - 0.3%

Total Price Growth - 1.7% 1.0% 3.4% 1.3% 2.1%

Volume (Decline) Growth(3)(4) (3.3%) 3.6% 0.8% (1.4%) (2.4%) (2.1%)

Total Organic Revenue (Decline) Growth (3.3%) 5.3% 1.8% 2.0% (1.1%) - %

Net Acquisitions 7.1% 11.0% 9.5% 0.2% (0.5%) (0.2%)

Total Growth Excluding Foreign Exchange (“FX”) 3.8% 16.3% 11.3% 2.2% (1.6%) (0.2%)

FX (0.3%) (3.3%)

Total Growth (Decline) Including FX 11.0% (3.5%)

17

% of Total Revenues Canada U.S. south U.S. northeast

Q1 2014 Reported Revenue By Segment

$U.S. (MM)

18

Segment Highlights • Canadian dollar weakened vs. U.S. dollar in Q1/14 vs. Q1/13, reducing total company revenue by $15.7MM on translation to U.S. dollars.

• Excluding impact of foreign currency translation total consolidated revenue declined (0.2%).

• Decline in revenue reflects contributions in Q1/13 from Super Storm Sandy (“Sandy”) and the sale of select assets. • We estimate challenging weather conditions adversely impacted consolidated revenues by more than $5MM in Q1/14.

• Expressed in U.S. dollars, Q1/14 Canadian revenue declined (6.6%) QoQ to $167.4MM. Excluding foreign currency translation, revenue grew $4MM or 2.2% QoQ.

• Q1/14 U.S. south revenue increased $10.3MM or 4.9% QoQ to $222.0MM.

• Q1/14 U.S. northeast revenue decreased 16% QoQ to $81.0MM. Note that Q1/13 included nearly $8.0MM of revenue from Sandy.

167 179

222 212

81 96

Q1 2014 Q1 2013 Canada U.S. south U.S. northeast

$487(1) $470(1)

36.8% 43.5% 19.7%

35.6% 47.2% 17.2%

1) Q1/13 Canadian revenue converted to $U.S. at $0.99. Q1/14 Canadian revenue converted to $U.S. at $0.90

Q1 2014 Reported and Gross Revenues(1)

$U.S. (MM) Q1/14 Q4/13 Q3/13 Q2/13 Q1/13

Total Reported Revenues $469.8 $502.0 $520.7 $516.8 $486.6

U.S. Canada

$302.4 $167.4

$309.9 $192.1

$321.6 $199.1

$318.0 $198.8

$307.5 $179.1

19

000’s Q1/14 Consolidated

$US

Q1/14 % of Gross Revenue

Q1/13 Consolidated

$US

Q1/13 % of Gross Revenue

Commercial $173,062 36.8 $175,722 36.1

Industrial 82,597 17.6 85,156 17.5

Residential 109,919 23.4 113,020 23.2

Transfer and Disposal 148,691 31.7 160,248 32.9

Recycling 16,439 3.5 14,979 3.1

Other 9,628 2.0 10,106 2.1

Gross Revenues 540,336 115.0 559,231 114.9

Intercompany (70,566) (15.0) (72,671) (14.9)

Revenues $469,770 100.0% $486,560 100%

(1) Gross Revenue includes intercompany revenue on a consolidated basis and includes the impact of FX.

94 97

141 131

58 69

Q1 2014 Q1 2013

Canada U.S. south U.S. northeast

Q1 2014 Operating Expenses

$U.S. (MM) • Operating expenses declined to $293MM in Q1/14 from $297MM in Q1/13.

• Operating expenses as a percentage of revenue increased 140 bps to 62.4% in Q1/14 QoQ due to higher transportation and disposal costs primarily due to the closure of the Calgary landfill to Municipal Solid Waste (“MSW”). • Fuel costs spiked in the quarter due to weather and contributed to higher operating expenses. However, we expect to recover a good portion of the increase in fuel costs through our surcharge and pricing programs this year.

• Repair and Maintenance (“R&M”) costs were higher than plan, some of which was due to harsh weather.

• Contract wins, and higher safety, insurance and claims in the U.S. south contributed to higher operating costs relative to revenues.

•Of note, despite a harsh operating environment the U.S. northeast segment experienced little change in operating expenses as a percentage of revenue QoQ .

$297(1) $293(1)

20

Highlights

1) Q1/13 Canadian operating expenses converted to $U.S. at $0.99. Q1/14 Canadian operating expenses converted to $U.S. at $0.90

Q1 2014 Gross Revenue By Service Line(1) in U.S. and Canada

21

000’s U.S. ($U.S.)

U.S. % of Revenue

Canada ($Canadian)

Canada % of Revenue

Commercial $98,582 32.6 $82,187 44.5 Industrial 51,761 17.1 34,027 18.4 Residential 80,049 26.5 32,961 17.8 Transfer and Disposal 100,727 33.3 52,927 28.7 Recycling 9,094 3.0 8,105 4.4 Other 5,083 1.7 5,015 2.7 Gross Revenues 345,296 114.2 215,222 116.5

Intercompany (42,887) (14.2) (30,544) (16.5) Revenues $302,409 100.0 % $184,678 100.0%

(1) Gross Revenue includes intercompany revenue on a consolidated basis.

17 18

22 21

9 9

16 13

Q1 2014 Q1 2013

Canada U.S. south U.S. northeast Corporate

Q1 2014 Adjusted Selling, General and Administration Expenses (“Adjusted SG&A”)(1)

$U.S. (MM)

• Adjusted SG&A increased $3MM to $64MM in Q1/14 QoQ.

• Increase primarily due to higher compensation expense and professional fees.

• As a percentage of revenue, Adjusted SG&A was 13.6%.

$61 $64

22

Highlights

1) Please refer to page 34 which outlines the types of expenses excluded from selling, general and administrative expense as reported.

56 65

60 59

13 18

-16 -13

Q1 2014 Q1 2013 Canada U.S. south U.S. northeast Corporate

Q1 2014 Adjusted Earnings Before Interest, Tax, Depreciation, Amortization (“Adjusted EBITDA(A) ”)

$U.S. (MM) Highlights • Q1/14 consolidated Adjusted EBITDA(A)

declined 12.5% QoQ to $112.9MM.

• Foreign currency translation reduced Q1/14 Adjusted EBITDA(A) $4.3MM.

• Adjusted EBITDA(A) declined due to Sandy volumes, Calgary landfill closure and higher safety, insurance and claims costs.

• Harsh weather contributed to the decline as well as MSW and special waste volumes that were delayed. We incurred higher R&M and vehicle operating costs associated with weather.

• Adjusted EBITDA(A) margins for the consolidated company were 24.0% in Q1/14 vs. 26.5% in Q1/13 with the impact of weather representing roughly 40 bps of the margin decline.

$129 $113

23

% of Adjusted EBITDA(A) Margins Total Company Canada U.S. South U.S. Northeast

36.2% 28.0% 18.6%

33.5% 26.9% 16.0%

26.5% 24.0%

(A) Please refer to the definition and explanation of (A) on slide 34.

$27 $21

$17 $40

Q1 2014 Q1 2013 Replacement Growth

Q1 2014 Capital Expenditures

$U.S. (MM)

• Total replacement capital in the first quarter was $27MM. • Total growth capital was nearly $17MM and includes $6MM of spending related to the building of the gas plant at our Lachenaie landfill.

• Excluding spending on the gas plant, total capital expenditures were $38MM.

$61

$44

24

Highlights

$49 $45

Q1 2014 Q1 2013

$14(1)

Q1 2014 Free Cash Flow(B)

$U.S. (MM)

• Generated strong free cash flow(B) of $48.7MM in Q1/14, representing 10.4% of revenue.

• We continue to expect free cash flow(B) of between $210 and $225MM in 2014, excluding the spending on the gas plant.

$59 $55

25

$6(1)

(B) Please refer to the definition and explanation of (B) on slide 37. (1) Free cash flow(B) excluding discretionary infrastructure expenditures of $14.4MM in Q1 2013 and $6MM in Q1 2014.

Highlights

Q1 2014 Interest Expense and Balance Sheet

• Total long-term debt was $1.54B at March 31, 2014 vs. $1.55B at December 31, 2013. • Funded debt to EBITDA, as defined and calculated in accordance with our consolidated facility, was 2.91x at

March 31, 2014 compared with 2.88x as at December 31, 2013. • Comfortable with current leverage level and believe optimal long-term leverage range for the company is

between 2.5x and 3.0x. • Interest expense on total outstanding debt was $14.9MM for the three months ended March 31, 2014.

Long-Term Debt Facilities $U.S. MM

Available Lending Accordion Facility

Drawn Letters of Credit

Available Capacity Ratings

Senior Secured Term B Facility $493.8 $493.8 _ _ Moody’s

Ba1

S&P BBB-

Senior Secured Revolving Facility

$1,850.0 $750.0 $974.6 $197.1 $678.2

IRBs(1) $64.0 $64.0 _ _

Other Notes $0.5 $0.5 _ _

26

(1) Variable Rate Demand Solid Waste Disposal Revenue Bonds.

$531 $533

$551

$(8.5)

$(5.0) $(2.0) $2.0

$33.5 $(18.0)

$510

$515

$520

$525

$530

$535

$540

$545

$550

$555

-0.8% -1.6%

-0.4%

-3.4%

6.2% 0.4%

2014E Adj. EBITDA(A)

@FX=$0.90

2014 Guidance(1) At February 13, 2014

$2,026

$2,000

$2,058

$(4.0)

$(8.0) $(10)

$54.0 $(58)

$1,970

$1,990

$2,010

$2,030

$2,050

$2,070

-0.4% 2.7%

-0.2%

-2.9% -0.5%

27

2013 Revenue

Calgary Landfill Closure

Super Storm Sandy

2014E Mid-point Revenue Guidance

2013 Adjusted EBITDA(A)

Calgary Landfill Closure

Long-term & Short-term

Compensation

Organic Growth

Foreign Exchange

2014E Mid-point Adjusted EBITDA(A)

Guidance

Super Storm Sandy

Revenue $U.S. (MM)

Adjusted EBITDA(A) $U.S. (MM)

Revenue at mid-point of 2014E Revenue @ FX=$0.97

Adj. EBITDA(A) at mid-point of 2014E Adj. EBITDA(A) @ FX=$0.97


2014E Revenue

@FX=$0.90

Foreign Exchange

Organic Growth

Sale of operations (Immaterial EBITDA

contribution)

Represents (60bps) of

volume in 2014

1.6%

3.8%

Gas plant contribution in 2H 2014 offset

by start-up costs in 1H 2014

28

2014 Guidance(1) At February 13, 2014

$U.S. (MM) 2013 Actual

(FX rate of $0.97)

2014 Guidance

(FX rate of $0.97)

Impact at constant

currency(1) 2014 Guidance (FX

rate of $0.90)

Revenue $2,026 $2,047 to $2,068 Increase $1,990 to $2,010 Adjusted EBITDA(A) $530.8 $546 to $556 Increase $528 to $538

Amortization expense, as a percentage of revenue 14.6% 14.2% Decrease 14.2% Adjusted operating EBIT(A) $246 $255 to$263 Increase $245 to $253 Interest expense $61 $65 to $67 Increase $64 to $66

Effective tax rate as a percentage of income before income tax expense and net (income) loss from equity accounted investee 33.0% 29.3% to 31.4% Decrease 30% to 32%

Cash taxes (expressed on an adjusted basis) $30 $38 to $39 Increase $35 to $37

Adjusted net income(A) per diluted share $1.10 $1.12 to $1.22 Increase $1.06 to $1.15

Free cash flow(B) excluding additional internal infrastructure investment $230 $219 to $236 Neutral $210 to $225

Capital and landfill expenditures excluding internal infrastructure investment and including net proceeds on sale(2) $214 $218 to $222 Increase $212 to $216(1)

Internal infrastructure investment(3) $39 $21 Decrease $20(2)

Expected annual cash dividend, payable on a quarterly basis C$0.58 per share C$0.60 per share N/A C$0.60 per share

1. Guidance assumes no change in the current economic environment and excludes the impact of any acquisitions we may complete in 2014

2. Assumes foreign exchange rate of $0.90 U.S. for each Canadian dollar 3. Assumes an average recycled commodity price for the year that is equal to our average price for Q4 2013

(A) Please refer to the definition and explanation of (A) on slide 34. (B) Please refer to the definition and explanation of (B) on slide 37. 1) Constant currency refers to these amounts being translated at an average FX rate of $0.9707. 2) Capital and landfill expenditures includes replacement expenditures, including net proceeds on sale, of approximately $181-184MM, representing approximately 9.1%

of revenues, at the mid-point of the guidance range. In 2014, replacement spending includes cell development of $15 MM at Seneca Meadows Landfill. Growth expenditures of $31 - $32MM include municipal contracts and organic growth.

3) Completion of natural gas plant at Lachenaie Landfill, Quebec.

Q1 2014 Adjusted Net Income(A) and Adjusted EPS(A)

Items of note $U.S.(MM) EPS ($’s) Segment Revenue/

Expense Line Item

Reported Net Income and EPS (diluted) $26.0MM $0.23

Transaction and related cost recoveries (1.1) (0.01) Corporate SG&A

Fair value movements in stock options 2.1 0.02 Corporate SG&A

Restricted share expense 0.4 0.00 Corporate SG&A

Net loss on financial instruments 3.3 0.03 All SG&A

Re-measurement gain on previously held equity investment (5.2) (0.05) All

Net Income tax recovery (0.7) (0.01)

Adjusted net income(A) and Adjusted EPS(A) (diluted) $24.8 $0.21

29 (A) Please refer to the definition and explanation of (A) on slide 34.

Q1 2014 Reconciliation of Adjusted EBITDA(A) to Free Cash Flow(B)

30

000’s Q1/14 Q1/13

Adjusted EBITDA(A) $112,862 $129,051 Purchase of restricted shares(*) (1,752) (358) Capital and landfill asset purchases(*)(*) (43,838) (61,386) Proceeds from the sale of capital and landfill assets 361 1,121 Landfill closure and post-closure expenditures (811) (795) Landfill closure and post-closure cost accretion expense 1,539 1,409 Interest on long-term debt (14,943) (15,243) Non-cash interest expense 854 856 Current income tax expense (5,578) (9,799) Free cash flow(B) $48,694 $44,856


Geographical Distribution

31

Serve more than 4 million customers in North America

Revenue

Adjusted EBITDA(A)

% Margin

$780.3

$217.1

27.8%

US$ millions FY 2012 FY 2013

Revenue

Adjusted EBITDA(A)

% Margin

$339.6

$71.5

21.1%


Revenue

Adjusted EBITDA(A)

% Margin

$776.8

$278.5

35.1%


Canada

South

Northeast

Note: Corporate Adjusted EBITDA(A) of ($52.0) million and ($47.4) million in 2013 and 2012, respectively, are not shown.

$769.1

$270.5

35.2%

$876.9

$236.0

26.9%

$380.1

$76.3

20.1%


Foreign Currency Translation Sensitivity

• We have elected to report our financial results in U.S. dollars. However, we earn a significant portion of our revenues and income in Canada.

• Based on our 2014 guidance outlook, if the U.S. dollar strengthens by one cent our reported revenues will decline by approximately $8.2MM.

• EBITDA(A) is similarly impacted by approximately $2.5MM, assuming a strengthening U.S. dollar.

• The impact on net income and free cash flow(B) for a similar change in FX rate, results in an approximately $1.1MM and $900,000 decline, respectively.

• Should the U.S. dollar weaken by one cent, our reported revenues, EBITDA(A) , net income and free cash flow(B) will improve by amounts similar to those outlined above as a result of a strengthening U.S. dollar.

32


Recycled Fiber Sensitivity

• Our revenues and earnings are impacted by changes in recycled commodity prices, which principally include old corrugated cardboard (“OCC”) and other paper fibers, including newsprint, sorted office paper and mixed paper.

• Other commodities we receive include wood, plastics, aluminum and metals. Our results of operations may be affected by changing prices or market demand for recyclable materials. The resale and purchase price of, and market demand for, recyclable materials can be volatile due to changes in economic conditions and numerous other factors beyond our control.

• These fluctuations may affect our consolidated financial condition, results of operations and cash flows.

• Based on current volumes, a ten dollar change in the price of an average basket of commodities results in an approximately $7.6MM change to revenues and an approximately $0.04 change to net income per share on an annual basis, applying the average FX rate for 2013.

33

Non-GAAP Disclosure

(A) All references to “Adjusted EBITDA” in this document are to revenues less operating expense and SG&A, excluding certain SG&A expenses, on the consolidated statement of operations and comprehensive income or loss. Adjusted EBITDA excludes some or all of the following: certain SG&A expenses, restructuring expenses, goodwill impairment, amortization, net gain or loss on sale of capital and landfill assets, interest on long-term debt, net foreign exchange gain or loss, net gain or loss on financial instruments, loss on extinguishment of debt, re-measurement gain on previously held equity investment, other expenses, income taxes and income or loss from equity accounted investee. Adjusted EBITDA is a term used by us that does not have a standardized meaning prescribed by U.S. GAAP and is therefore unlikely to be comparable to similar measures used by other companies. Adjusted EBITDA is a measure of our operating profitability, and by definition, excludes certain items as detailed above. These items are viewed by us as either non-cash (in the case of goodwill impairment, amortization, net gain or loss on financial instruments, net foreign exchange gain or loss, re-measurement gain on previously held equity investment, deferred income taxes and net income or loss from equity accounted investee) or non-operating (in the case of certain SG&A expenses, restructuring expenses, net gain or loss on sale of capital and landfill assets, interest on long-term debt, loss on extinguishment of debt, other expenses, and current income taxes). Adjusted EBITDA is a useful financial and operating metric for us, our Board of Directors, and our lenders, as it represents a starting point in the determination of free cash flow(B). The underlying reasons for the exclusion of each item are as follows:

Certain SG&A expenses – SG&A expense includes certain non-operating or non-recurring expenses. Non-operating expenses include transaction costs or recoveries related to acquisitions, fair value adjustments attributable to stock options and restricted share expense. Non-recurring expenses include certain equity based compensation, payments made to certain senior management on their departure and other non-recurring expenses from time-to-time. These expenses are not considered an expense indicative of continuing operations. Certain SG&A costs represent a different class of expense than those included in adjusted EBITDA.

Restructuring expenses – restructuring expenses includes costs to integrate certain operating locations with our own, exiting certain property and building and office leases, employee severance and employee relocation costs all of which were incurred in connection with our acquisition of WSI. These expenses are not considered an expense indicative of continuing operations. Accordingly, restructuring expenses represent a different class of expense than those included in adjusted EBITDA.

Goodwill impairment – as a non-cash item goodwill impairment has no impact on the determination of free cash flow(B) and is not indicative of our operating profitability.

Amortization – as a non-cash item amortization has no impact on the determination of free cash flow(B) and is not indicative of our operating profitability. Net gain or loss on sale of capital and landfill assets – proceeds from the sale of capital assets are either reinvested in additional or replacement capital assets

or used to repay revolving credit facility borrowings. Interest on long-term debt – interest on long-term debt reflects our debt/equity mix, interest rates and borrowing position from time to time. Accordingly,

interest on long-term debt reflects our treasury/financing activities and represents a different class of expense than those included in adjusted EBITDA. Net foreign exchange gain or loss – as non-cash items, foreign exchange gains or losses have no impact on the determination of free cash flow(B) and is not

indicative of our operating profitability. Net gain or loss on financial instruments – as non-cash items, gains or losses on financial instruments have no impact on the determination of free cash flow(B)

and is not indicative of our operating profitability. Loss on extinguishment of debt – loss on extinguishment of debt is a function of our debt financing. Accordingly, it reflects our treasury/financing activities and

represents a different class of expense than those included in adjusted EBITDA.

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Non-GAAP Disclosure

(A) Continued - Re-measurement gain on previously held equity investment – as a non-cash item, a re-measurement gain on previously held equity investment has no impact

on the determination of free cash flow(B) and is not indicative of our operating profitability. Other expenses – other expenses typically represent amounts paid to certain management of acquired companies who are retained by us post acquisition and

amounts paid to certain executives in respect of acquisitions successfully completed. These expenses are not considered an expense indicative of continuing operations. Accordingly, other expenses represent a different class of expense than those included in adjusted EBITDA.

Income taxes – income taxes are a function of tax laws and rates and are affected by matters which are separate from our daily operations. Net income or loss from equity accounted investee – as a non-cash item, net income or loss from our equity accounted investee has no impact on the

determination of free cash flow(B) and is not indicative of our operating profitability. All references to “Adjusted EBITA” in this document represent Adjusted EBITDA after deducting amortization of capital and landfill assets. All references to

“Adjusted operating income or adjusted operating EBIT” in this document represent Adjusted EBITDA after adjusting for net gain or loss on the sale of capital and landfill assets and all amortization expense, including amortization expense recognized on the impairment of intangible assets. All references to “Adjusted net income” are to adjusted operating income after adjusting, as applicable net gain or loss on financial instruments, re-measurement gain on previously held equity investment, loss on extinguishment of debt, other expenses and net income tax expense or recovery.

Adjusted EBITA, Adjusted operating income or adjusted operating EBIT and Adjusted net income should not be construed as measures of income or of cash flows. Collectively, these terms do not have standardized meanings prescribed by U.S. GAAP and are therefore unlikely to be comparable to similar measures used by other companies. Each of these measures are important for investors and are used by management in the management of its business. Adjusted operating income or adjusted operating EBIT removes the impact of a company’s capital structure and its tax rates when comparing the results of companies within or across industry sectors. Management uses Adjusted operating EBIT as a measure of how its operations are performing and to focus attention on amortization and depreciation expense to drive higher returns on invested capital. In addition, Adjusted operating EBIT is used by management as a means to measure the performance of its operating locations and is a significant metric in the determination of compensation for certain employees. Adjusted EBITA accomplishes a similar comparative result as Adjusted operating EBIT, but further removes amortization attributable to intangible assets. Intangible assets are measured at fair value when we complete an acquisition and amortized over their estimated useful lives. We view capital and landfill asset amortization as a proxy for the amount of capital reinvestment required to continue operating our business steady state. We believe that the replacement of intangible assets is not required to continue our operations as the costs associated with continuing operations are already captured in operating or selling, general and administration expenses. Accordingly, we view Adjusted EBITA as a measure that eliminates the impact of a company’s acquisitive nature and permits a higher degree of comparability across companies within our industry or across different sectors from an operating performance perspective. Finally, Adjusted net income is a measure of our overall earnings and profits and is further used to calculate our net income per share. Adjusted net income reflects what we believe is our “operating” net income which excludes certain non-operating income or expenses. Adjusted net income is an important measure of a company’s ability to generate profit and earnings for its shareholders which is used to compare company performance both amongst and between industry sectors.

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Non-GAAP Disclosure

36

Three months ended March 31 2014 2013

Operating income $ 41,267 $ 59,174 Transaction and related recoveries - SG&A (1,083) (565) Fair value movements in stock options - SG&A(*) 2,054 (505) Restricted share expense - SG&A(*) 384 265 Adjusted operating income or adjusted operating EBIT 42,622 58,369 Net loss (gain) on sale of capital and landfill assets 3,033 (617) Amortization 67,207 71,299 Adjusted EBITDA 112,862 129,051 Amortization of capital and landfill assets (53,309) (55,939) Adjusted EBITA $ 59,553 $ 73,112

Net income $ 25,919 $ 29,341 Transaction and related recoveries - SG&A (1,083) (565) Fair value movements in stock options - SG&A(*) 2,054 (505) Restricted share expense - SG&A(*) 384 265 Net loss (gain) on financial instruments 3,335 (2,265) Re-measurement gain on previously held equity investment (5,156) - Net income tax (recovery) expense (701) 826 Adjusted net income $ 24,752 $ 27,097 Note:

(*)Amounts exclude LTIP compensation.

Three months ended March 31 2014 2013 Change

Adjusted EBITDA(A) $ 112,862 $ 129,051 $ (16,189)

Purchase of restricted shares(*)

(1,752) (358) (1,394)

Capital and landfill asset purchases(*)(*)

(43,838) (61,386) 17,548

Proceeds from the sale of capital and landfill assets

361 1,121 (760)

Landfill closure and post- closure expenditures

(811) (795) (16)

Landfill closure and post- closure cost accretion expense

1,539 1,409 130

Interest on long-term debt (14,943) (15,243) 300 Non-cash interest expense 854 856 (2) Current income tax expense (5,578) (9,799) 4,221 Free cash flow(B) $ 48,694 $ 44,856 $ 3,838

Note:

(*)Amounts exclude LTIP compensation. (*)(*)Capital and landfill asset purchases include infrastructure expenditures of approximately $6,000 and $14,400 for the three months ended March 31, 2014 and 2013, respectively.

Non-GAAP Disclosure

(B) We have adopted a measure called “free cash flow” to supplement net income or loss as a measure of our operating performance. Free cash flow is a term which does not have a standardized meaning prescribed by U.S. GAAP, is prepared before dividends declared and shares repurchased, and may not be comparable to similar measures prepared by other companies. The purpose of presenting this non-GAAP measure is to provide disclosure similar to the disclosure provided by other U.S. publicly listed companies in our industry and to provide investors and analysts with an additional measure of our value and liquidity. We use this non-GAAP measure to assess our performance relative to other U.S. publicly listed companies and to assess the availability of funds for growth investment, debt repayment, share repurchases or dividend increases. All references to “free cash flow” in this document have the meaning set out in this note.

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Chaya Cooperberg, VP Investor Relations Tel: 905-532-7517 [email protected] Laura Lepore, Manager Investor Relations Tel: 905-532-7519 [email protected]

mailto:[email protected]

mailto:[email protected]