What changed in this filing

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Item 1. Financial Statements

2024-07-25 compared with 2024-05-01 · 246 added, 169 removed, 724 unchanged (36% of the section changed)

3 unchanged sentences

(in millions, except per share data)

March 31, December 31,

June 30, December 31,

Current assets:

46 unchanged sentences

(in millions, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Revenue $ 4,048.0 $ 3,725.9 $ 7,909.8 $ 7,307.0

3 unchanged sentences

Selling, general and administrative 407.6 396.0 821.7 775.2

Gain on business divestitures and impairments, net ( 1.4 ) — ( 1.4 ) —

Restructuring charges 5.7 15.5 11.5 21.0

2 unchanged sentences

Loss on extinguishment of debt — — — ( 0.2 )

(Loss) income from unconsolidated equity method investments ( 8.7 ) 1.0

Loss from unconsolidated equity method investments ( 33.8 ) ( 3.6 ) ( 42.5 ) ( 2.7 )

Interest income 1.6 1.6 3.1 3.0

Other income, net 12.6 2.5

Other income (loss), net 0.7 ( 0.6 ) 13.3 1.9

Income before income taxes 654.0 580.2 1,252.9 1,102.3

1 unchanged sentence

Net income 511.9 427.6 965.6 811.4

Net loss attributable to non-controlling interests in consolidated subsidiary

Net income attributable to non-controlling interests in consolidated subsidiary

( 0.4 ) ( 0.2 ) ( 0.3 ) ( 0.2 )

Net income attributable to Republic Services, Inc.

8 unchanged sentences

Weighted average common and common equivalent shares outstanding

315.2 317.3 315.5 317.2

Cash dividends per common share $ 0.535 $ 0.495 $ 1.070 $ 0.990

The accompanying notes are an integral part of these statements.(income)

The accompanying notes are an integral part of these statements.

REPUBLIC SERVICES, INC.

1 unchanged sentence

(in millions)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Net income $ 511.9 $ 427.6 $ 965.6 $ 811.4

9 unchanged sentences

Comprehensive income 508.1 430.2 968.6 816.8

Comprehensive loss attributable to non-controlling interests 0.1 —

Comprehensive income attributable to non-controlling interests ( 0.4 ) ( 0.2 ) ( 0.3 ) ( 0.2 )

Comprehensive income attributable to Republic Services, Inc.

18 unchanged sentences

Balance as of March 31, 2024

321.2 3.2 2,916.0 8,717.9 ( 6.3 ) ( 812.0 ) ( 5.3 ) 0.8 10,820.6

Net income — — — 511.5 — — — 0.4 511.9

Other comprehensive loss — — — — — — ( 3.8 ) — ( 3.8 )

Cash dividends declared — — — ( 168.0 ) — — — — ( 168.0 )

Issuances of common stock — — 5.0 — — ( 0.7 ) — — 4.3

Stock-based compensation — — 11.2 ( 0.7 ) — — — — 10.5

Purchase of common stock for treasury — — — — ( 0.9 ) ( 169.2 ) — — ( 169.2 )

Balance as of June 30, 2024

321.2 $ 3.2 $ 2,932.2 $ 9,060.7 ( 7.2 ) $ ( 981.9 ) $ ( 9.1 ) $ 1.2 $ 11,006.3

Republic Services, Inc.

12 unchanged sentences

320.6 3.2 2,858.4 7,582.7 ( 4.3 ) ( 518.5 ) ( 9.3 ) 0.8 9,917.3

Net income — — — 427.4 — — — 0.2 427.6

Other comprehensive income — — — — — — 2.6 — 2.6

Cash dividends declared — — — ( 156.6 ) — — — — ( 156.6 )

Issuances of common stock 0.1 — 4.5 — — ( 0.5 ) — — 4.0

Stock-based compensation — — 10.6 ( 0.8 ) — — — — 9.8

Balance as of June 30, 2023

320.7 $ 3.2 $ 2,873.5 $ 7,852.7 ( 4.3 ) $ ( 519.0 ) $ ( 6.7 ) $ 1.0 $ 10,204.7

The accompanying notes are an integral part of these statements.

2 unchanged sentences

(in millions)

Three Months Ended March 31,

Six Months Ended June 30,

Cash provided by operating activities:

26 unchanged sentences

Sales of restricted marketable securities 16.4 9.1

Other ( 0.2 ) 11.5

Cash used in investing activities ( 1,112.7 ) ( 1,674.3 )

4 unchanged sentences

Issuances of common stock, net ( 21.0 ) ( 7.0 )

Purchases of common stock for treasury ( 167.6 ) —

Cash dividends paid ( 336.8 ) ( 313.0 )

32 unchanged sentences

We must make these estimates and assumptions because certain information we use is dependent on future events, cannot be calculated with a high degree of precision from data available or simply cannot be readily calculated based on generally accepted methodologies.

In preparing our financial statements, the more critical and subjective areas that deal with the greatest amount of uncertainty relate to our accounting for our long-lived assets, including recoverability, landfill development costs and final capping, closure and post-closure costs;

our valuation allowances for accounts receivable and deferred tax assets;

our liabilities for potential litigation, claims and assessments;

our liabilities for environmental remediation, multiemployer pension plans, employee benefit plans, deferred taxes, uncertain tax positions and insurance reserves;

and our estimates of the fair values of assets acquired and liabilities assumed in any acquisition.

Each of these items is discussed in more detail in our description of our significant accounting policies in Note 2, Summary of Significant Accounting Policies , of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

In preparing our financial statements, the more critical and subjective areas that deal with the greatest amount of uncertainty relate to our accounting for our landfill development costs and final capping, closure and post-closure costs;

our liabilities for environmental remediation, and insurance reserves.

For more detail on significant accounting policies, refer to Note 2, Summary of Significant Accounting Policies , of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Our actual results may differ significantly from our estimates.

5 unchanged sentences

The rules require implementation in phases between 2025 and 2033.

In April 2024, the SEC announced that it would voluntarily stay its final climate disclosure rules pending judicial review.

In April 2024, the SEC announced that it would voluntarily stay these rules pending judicial review.

The Company is currently evaluating the impact of the rules on its future consolidated financial statements.

Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative

In October 2023, the FASB issued ASU 2023-06 to modify the disclosure or presentation requirements of a variety of topics,

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative

In October 2023, the FASB issued ASU 2023-06 to modify the disclosure or presentation requirements of a variety of topics, which will allow users to more easily compare entities subject to the SEC's existing disclosures with those entities that were not previously subject to the SEC's requirements, and to align the requirements in the FASB accounting standard codification with the SEC's regulations.

The Company is currently evaluating the provisions of the amendments and the impact on its future consolidated financial statements.

which will allow users to more easily compare entities subject to the SEC's existing disclosures with those entities that were not previously subject to the SEC's requirements, and to align the requirements in the FASB accounting standard codification with the SEC's regulations.

The Company is currently evaluating the amendments and the impact on its future consolidated financial statements.

Improvements to Reportable Segment Disclosures

1 unchanged sentence

Improvements to Reportable Segment Disclosures (ASU 2023-07) .

ASU 2023-07 improves the reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

ASU 2023-07 amends the reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

The amendments in this update are effective for fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024.

7 unchanged sentences

BUSINESS ACQUISITIONS, INVESTMENTS AND RESTRUCTURING CHARGES

We acquired various environmental services businesses during the three months ended March 31, 2024 and 2023.

We acquired various environmental services businesses during the six months ended June 30, 2024 and 2023.

The aggregate purchase price paid for these business acquisitions and the allocations of the aggregate purchase price follows:

2 unchanged sentences

$ 40.9 $ 918.7

Fair value, future minimum finance lease payments

Total $ 40.9 $ 927.3

2 unchanged sentences

Prepaid expenses — 1.0

Landfill development costs

Property and equipment

Operating right-of-use lease assets

Parts and supplies

Accounts payable

1 unchanged sentence

Deferred revenue

Environmental remediation liabilities

Closure and post-closure liabilities

Operating right-of-use lease liabilities

Deferred income tax liabilities ( 1.3 ) ( 9.2 )

5 unchanged sentences

Other intangible assets

$ 4.2 $ 103.0

Total allocated $ 20.4 $ 777.0

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Certain of the purchase price allocations are preliminary and based on information existing at the acquisition dates.

Accordingly, the purchase price allocations are subject to change.

For the acquisitions that closed during the three months ended March 31, 2024, we expect that a majority of the goodwill and intangible assets recognized as a result of these acquisitions will not be deductible for tax purposes.

For the acquisitions that closed during the six months ended June 30, 2024, we expect that a majority of the goodwill and intangible assets recognized as a result of these acquisitions will not be deductible for tax purposes.

These acquisitions are not material to the Company's results of operations, individually or in the aggregate.

As a result, no pro forma financial information is provided.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

In November 2023, we acquired all of the issued and outstanding capital stock or other ownership interests of Advanced Chemical Transport LLC (ACT).

1 unchanged sentence

The purchase price allocation is preliminary and remains subject to revision as additional information is obtained about the facts and circumstances that existed at the valuation date.

The preliminary allocation of purchase price, including the value assigned to tangible and intangible assets acquired, is based on the best estimates of management and is subject to revision based on the final valuations.

The preliminary allocation of purchase price, including the value assigned to property, plant and equipment and customer relationship intangible assets acquired, is based on the best estimates of management and is subject to revision based on the final valuations.

We expect our final valuations to be completed in the fourth quarter of 2024.

2 unchanged sentences

The purchase price allocation is preliminary and remains subject to revision as additional information is obtained about the facts and circumstances that existed at the valuation date.

The preliminary allocation of purchase price, including the value assigned to tangible and intangible assets acquired as well as certain landfill and environmental liabilities assumed, is based on the best estimates of management and is subject to revision based on the final valuations.

The preliminary allocation of purchase price, including the value assigned to property, plant and equipment and customer relationship intangible assets acquired as well as certain landfill and environmental liabilities assumed, is based on the best estimates of management and is subject to revision based on the final valuations.

We expect our final valuations to be completed in the fourth quarter of 2024.

In 2024 , we acquired a non-controlling equity interest in a joint venture with a landfill gas-to-energy developer to construct a renewable natural gas project at one of our landfill locations in Illinois.

As of March 31, 2024 , we had contributed $ 29 million in the joint venture.

During the six months ended June 30, 2024 , we contributed $ 30.8 million in the joint venture.

The investment is accounted for under the equity method of accounting.

In 2024 , we acquired a non-controlling equity interest in a thermal processing facility that treats and recycles contaminated soil, hazardous and non-hazardous waste, and contaminated water to expand our environmental service offering in Canada.

During the six months ended June 30, 2024 , we contributed $ 26.9 million in the joint venture.

The investment is accounted for under the equity method of accounting.

These investments were recorded as other assets in our consolidated balance sheets as of June 30, 2024 .

In 2024 and 2023, we acquired non-controlling equity interests in certain limited liability companies that qualified for investment tax credits under Section 48 of the Internal Revenue Code.

In exchange for our non-controlling interests, we made capital contributions of $ 87.3 million and $ 1.5 million, which were recorded to other assets in our March 31, 2024 and 2023 consolidated balance sheets, respectively.

During the three months ended March 31, 2024 , we decreased the carrying value of these investments by $ 9.2 million and during the three months ended March 31, 2023, we increased the carrying value of these investments by $ 1.3 million, as a result of cash distributions and our share of income and loss pursuant to the terms of the limited liability company agreements.

Additionally, our tax provisions reflect benefits of approximately $ 8 million for the three months ended March 31, 2024 due to the tax credits related to these investments, compared to no benefits for the three months ended March 31, 2023.

In exchange for our non-controlling interests, we made capital contributions of $ 90.8 million and $ 1.5 million, which were recorded to other assets in our June 30, 2024 and 2023 consolidated balance sheets, respectively.

During the three and six months ended June 30, 2024 , we decreased the carrying value of these investments by $ 33.2 million and $ 42.4 million, respectively.

Additionally, our tax provisions reflect benefits of $ 32.6 million and $ 41.0 million for the three and six months ended June 30, 2024 due to the tax credits related to these investments, compared to no benefits for the three and six months ended June 30, 2023.

For further discussion of the income tax benefits, refer to Note 11, Income Taxes, in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2023.

Restructuring Charges

During the three months ended March 31, 2024 and 2023, we incurred restructuring charges of $ 5.9 million and $ 5.5 million, respectively.

These charges related to the redesign of our asset management, and customer and order management software systems.

During the three months ended March 31, 2024 and 2023, we paid $ 5.7 million and $ 5.0 million, respectively, related to these restructuring efforts.

During the three and six months ended June 30, 2024 , we incurred restructuring charges of $ 5.7 million and $ 11.5 million, respectively, and during the three and six months ended June 30, 2023, we incurred restructuring charges of $ 15.5 million and $ 21.0 million , respectively .

The 2024 charges related to the redesign of our asset management, and customer and order management software systems.

Of the 2023 charges, $ 9.4 million related to the early termination of certain leases and $ 6.1 million related to the redesign of our asset management, and customer and order management software systems.

During the six months ended June 30, 2024 and 2023, we paid $ 9.9 million and $ 26.1 million, respectively, related to these restructuring efforts.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

GOODWILL AND OTHER INTANGIBLE ASSETS, NET

1 unchanged sentence

Balance as of December 31, 2023

Acquisitions Divestitures Adjustments to Acquisitions and Other Balance as of March 31, 2024

Acquisitions Divestitures Adjustments to Acquisitions and Other Balance as of June 30, 2024

Group 1 $ 7,312.4 $ 1.1 $ — $ 16.7 $ 7,330.2

2 unchanged sentences

Total $ 15,834.5 $ 16.2 $ ( 0.3 ) $ 14.5 $ 15,864.9

Adjustments to acquisitions during the three months ended March 31, 2024 primarily related to changes in our valuation of tangible assets acquired and certain environmental liabilities assumed as a result of obtaining new information regarding the acquisitions that closed in 2023.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Adjustments to acquisitions during the six months ended June 30, 2024 primarily related to changes in our valuation of property, plant and equipment acquired as a result of obtaining new information regarding the acquisitions that closed in 2023.

Other Intangible Assets, Net

4 unchanged sentences

Acquisitions Adjustments

Balance as of March 31, 2024

Balance as of June 30, 2024

Balance as of December 31, 2023

Additions Charged to Expense Adjustments

Balance as of March 31, 2024

Other Intangible Assets, Net as of March 31, 2024

Balance as of June 30, 2024

Other Intangible Assets, Net as of June 30, 2024

Customer relationships

6 unchanged sentences

Prepaid Expenses and Other Current Assets

A summary of prepaid expenses and other current assets as of March 31, 2024 and December 31, 2023 follows:

A summary of prepaid expenses and other current assets as of June 30, 2024 and December 31, 2023 follows:

Parts and supplies $ 99.9 $ 97.3

Prepaid expenses 94.3 123.0

Inventories 101.4 97.3

Other non-trade receivables 56.2 63.2

Income taxes receivable 47.4 126.3

Reinsurance receivable 38.7 35.4

Income taxes receivable 29.9 126.3

Prepaid fees for cloud-based hosting arrangements, current 24.4 17.0

2 unchanged sentences

Total $ 351.3 $ 472.6

A summary of other assets as of March 31, 2024 and December 31, 2023 follows:

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

A summary of other assets as of June 30, 2024 and December 31, 2023 follows:

Investments $ 586.0 $ 469.4

1 unchanged sentence

Deferred compensation plan 119.1 112.7

Prepaid fees and capitalized implementation costs for cloud-based hosting arrangements 106.6 67.6

Reinsurance receivable 94.7 92.1

Derivative and hedging assets 87.9 74.1

Deferred contract costs and sales commissions 81.3 82.5

Prepaid fees and capitalized implementation costs for cloud-based hosting arrangements 79.9 67.6

Derivative and hedging assets 59.3 74.1

Amounts recoverable for capping, closure and post-closure obligations 23.1 21.9

2 unchanged sentences

Total $ 1,321.6 $ 1,183.9

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

OTHER LIABILITIES

Other Accrued Liabilities

A summary of other accrued liabilities as of March 31, 2024 and December 31, 2023 follows:

A summary of other accrued liabilities as of June 30, 2024 and December 31, 2023 follows:

Accrued payroll and benefits $ 280.7 $ 350.5

Insurance reserves, current 226.4 216.6

Accrued dividends 168.5 168.3

Accrued fees and taxes 188.8 193.5

Accrued dividends 168.0 168.3

Operating right-of-use lease liabilities, current 53.2 54.8

Current tax liabilities 41.8 2.1

Ceded insurance reserves, current 38.7 35.4

4 unchanged sentences

Other Long-Term Liabilities

A summary of other long-term liabilities as of March 31, 2024 and December 31, 2023 follows:

A summary of other long-term liabilities as of June 30, 2024 and December 31, 2023 follows:

Operating right-of-use lease liabilities $ 188.6 $ 194.9

6 unchanged sentences

Total $ 600.2 $ 594.6

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

LANDFILL AND ENVIRONMENTAL COSTS

As of March 31, 2024, we owned or operated 207 active landfills with total available disposal capacity estimated to be 5.1 billion in-place cubic yards.

As of June 30, 2024, we owned or operated 208 active landfills with total available disposal capacity estimated to be 5.1 billion in-place cubic yards.

Additionally, we had post-closure responsibility for 126 closed landfills.

Accrued Landfill and Environmental Costs

A summary of accrued landfill and environmental liabilities as of March 31, 2024 and December 31, 2023 follows:

A summary of accrued landfill and environmental liabilities as of June 30, 2024 and December 31, 2023 follows:

Landfill final capping, closure and post-closure liabilities $ 2,004.9 $ 1,937.2

3 unchanged sentences

Long-term portion $ 2,332.2 $ 2,281.0

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Final Capping, Closure and Post-Closure Costs

The following table summarizes the activity in our asset retirement obligation liabilities, which includes liabilities for final capping, closure and post-closure, for the three months ended March 31, 2024 and 2023:

The following table summarizes the activity in our asset retirement obligation liabilities, which includes liabilities for final capping, closure and post-closure, for the six months ended June 30, 2024 and 2023:

Asset retirement obligation liabilities, beginning of year $ 1,937.2 $ 1,786.4

Non-cash additions 29.6 30.7

Acquisitions, net of divestitures and other adjustments 4.1 11.8

Asset retirement obligation adjustments 2.8 ( 9.7 )

16 unchanged sentences

It is reasonably possible that we will need to adjust the liabilities recorded for remediation to reflect the effects of new or additional information, to the extent such information impacts the costs, timing or duration of the required actions.

If we used the reasonably possible high ends of our ranges, our aggregate potential remediation liability as of March 31, 2024 would be approximately $ 375 million higher than the amount recorded.

If we used the reasonably possible high ends of our ranges, our aggregate potential remediation liability as of June 30, 2024 would be approximately $ 375 million higher than the amount recorded.

Future changes in our estimates of the cost, timing or duration of the required actions could have a material adverse effect on our consolidated financial position, results of operations and cash flows.

The following table summarizes the activity in our environmental remediation liabilities for the three months ended March 31, 2024 and 2023:

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

The following table summarizes the activity in our environmental remediation liabilities for the six months ended June 30, 2024 and 2023:

Environmental remediation liabilities, beginning of year $ 485.4 $ 487.5

1 unchanged sentence

Accretion expense (non-cash interest expense) 8.4 9.0

Acquisitions, net of divestitures and other adjustments 0.7 32.4

Environmental remediation liabilities, end of period 467.8 507.7

2 unchanged sentences

Bridgeton Landfill.

During the three months ended March 31, 2024, we paid $ 2.4 million related to management and monitoring of the remediation area for our closed Bridgeton Landfill in Missouri.

During the six months ended June 30, 2024, we paid $ 5.4 million related to management and monitoring of the remediation area for our closed Bridgeton Landfill in Missouri.

We continue to work with state and federal regulatory agencies on our remediation efforts.

From time to time, this may require us to modify our future operating timeline and procedures, which could result in changes to our expected liability.

As of March 31, 2024, the remediation liability recorded for this site was $ 71.2 million, of which approximately $ 11 million is expected to be paid during the remainder of 2024.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

As of June 30, 2024, the remediation liability recorded for this site was $ 68.2 million, of which approximately $ 8 million is expected to be paid during the remainder of 2024.

West Lake Landfill Superfund Site .

8 unchanged sentences

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

The carrying value of our credit facilities, finance leases and long-term debt as of March 31, 2024 and December 31, 2023 is listed in the following table, and is adjusted for the fair value of interest rate swaps, unamortized discounts, deferred issuance costs and the unamortized portion of adjustments to fair value recorded in purchase accounting.

The carrying value of our credit facilities, finance leases and long-term debt as of June 30, 2024 and December 31, 2023 is listed in the following table, and is adjusted for unamortized discounts, deferred issuance costs and the unamortized portion of adjustments to fair value recorded in purchase accounting.

Original issue discounts, deferred issuance costs, and adjustments to fair value recorded in purchase accounting are amortized to interest expense over the term of the applicable instrument using the effective interest method.

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Maturity Interest Rate Principal Adjustments Carrying Value Principal Adjustments Carrying Value

14 unchanged sentences

April 2029 4.875 750.0 ( 7.0 ) 743.0 750.0 ( 6.9 ) 743.1

November 2029 5.000 400.0 ( 3.8 ) 396.2 — — —

March 2030 2.300 600.0 ( 4.2 ) 595.8 600.0 ( 4.5 ) 595.5

4 unchanged sentences

April 2034 5.000 800.0 ( 10.3 ) 789.7 800.0 ( 10.7 ) 789.3

November 2034 5.200 500.0 ( 5.6 ) 494.4 — — —

March 2035 6.086 181.9 ( 11.2 ) 170.7 181.9 ( 11.5 ) 170.4

16 unchanged sentences

The Uncommitted Credit Facility bears interest at an annual percentage rate to be agreed upon by both parties.

Borrowings under the Uncommitted Credit Facility can be used for working capital, letters of credit, and other general corporate purposes.

The agreement governing our Uncommitted Credit Facility requires us to comply with certain covenants.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Borrowings under the Uncommitted Credit Facility can be used for working capital, letters of credit, and other general corporate purposes.

The agreement governing our Uncommitted Credit Facility requires us to comply with certain covenants.

The Uncommitted Credit Facility may be terminated by either party at any time.

As of March 31, 2024, we had $ 24.2 million of borrowings outstanding under our Uncommitted Credit Facility.

As of December 31, 2023, we had no borrowings outstanding under our Uncommitted Credit Facility.

As of both June 30, 2024 and December 31, 2023, we had no borrowings outstanding under our Uncommitted Credit Facility.

The Credit Facility

5 unchanged sentences

In February 2023, we entered into Amendment No.

1 to the Credit Facility to add our subsidiary, USE Canada Holdings, Inc.

(the Canadian Borrower), as an additional borrower under the Credit Facility, and provided that the aggregate of (i) all loans to the Canadian Borrower and (ii) all loans denominated in Canadian dollars cannot exceed $ 500.0 million (the Canadian Sublimit).

1 to the Credit Facility to add our subsidiary, USE Canada Holdings, Inc.(the Canadian Borrower), as an additional borrower under the Credit Facility, and provided that the aggregate of (i) all loans to the Canadian Borrower and (ii) all loans denominated in Canadian dollars cannot exceed $ 500.0 million (the Canadian Sublimit).

In October 2023, we entered into Amendment No.

3 unchanged sentences

The Canadian dollar-denominated loans bear interest based on the Canadian Prime Rate or the Canadian Dollar Offered Rate plus a current applicable margin of 0.910 % based on our Debt Ratings.

As of March 31, 2024 and December 31, 2023, C$ 220.6 million and C$ 201.5 million, respectively, were outstanding against the Canadian Sublimit.

The weighted average interest rate for borrowings outstanding as of March 31, 2024 was 6.225 %.

As of June 30, 2024 and December 31, 2023, C$ 249.9 million and C$ 201.5 million, respectively, were outstanding against the Canadian Sublimit.

The weighted average interest rate for borrowings outstanding as of June 30, 2024 was 6.223 %.

The Credit Facility is subject to facility fees based on applicable rates defined in the Credit Facility agreement and the aggregate commitment, regardless of usage.

2 unchanged sentences

We may pay dividends and repurchase common stock if we are in compliance with these covenants.

We had $ 162.9 million and $ 297.1 million of borrowings outstanding under the Credit Facility as of March 31, 2024 and December 31, 2023, respectively.

We had $ 332.8 million and $ 336.5 million of letters of credit outstanding under the Credit Facility as of March 31, 2024 and December 31, 2023, respectively.

We also had $ 508.3 million and $ 495.3 million of principal borrowings outstanding (net of related discount on issuance) under the commercial paper program as of March 31, 2024 and December 31, 2023, respectively.

As a result, availability under our Credit Facility was $ 2,495.3 million and $ 2,371.2 million as of March 31, 2024 and December 31, 2023, respectively.

We had $ 182.7 million and $ 297.1 million of borrowings outstanding under the Credit Facility as of June 30, 2024 and December 31, 2023, respectively.

We had $ 315.4 million and $ 336.5 million of letters of credit outstanding under the Credit Facility as of June 30, 2024 and December 31, 2023, respectively.

We also had $ 179.9 million and $ 495.3 million of principal borrowings outstanding (net of related discount on issuance) under the commercial paper program as of June 30, 2024 and December 31, 2023, respectively.

As a result, availability under our Credit Facility was $ 2,821.9 million and $ 2,371.2 million as of June 30, 2024 and December 31, 2023, respectively.

Term Loan Facility

On April 29, 2022, we entered into a $ 1.0 billion term loan facility (the Term Loan Facility).

The Term Loan Facility will mature on April 29, 2025 and bears interest at a base rate or a forward-looking SOFR, plus an applicable margin based on our debt ratings.

The weighted average interest rate for borrowings outstanding as of March 31, 2024 was 6.227 %.

We may prepay, without penalty, all or any part of the borrowings under the Term Loan Facility at any time.

We had $ 500.0 million of borrowings outstanding under the Term Loan Facility as of both March 31, 2024 and December 31, 2023.

On April 29, 2022, we entered into a $ 1.0 billion term loan facility (the Term Loan Facility) which bears interest at a base rate or a forward-looking SOFR, plus an applicable margin based on our debt ratings.

We had $ 500.0 million of borrowings outstanding under the Term Loan Facility as of December 31, 2023.

During the six months ended June 30, 2024, we paid down the remaining balance of the Term Loan Facility.

Commercial Paper Program

In May 2022, we entered into a commercial paper program for the issuance and sale of unsecured commercial paper in an aggregate principal amount not to exceed $ 500.0 million outstanding at any one time (the Commercial Paper Cap).

In October 2023, the Commercial Paper Cap was increased to $ 1.5 billion.

The weighted average interest rate for borrowings outstanding as of March 31, 2024 was 5.483 % with a weighted average maturity of 18 days.

We had $ 509.0 million and $ 496.0 million in aggregate principal amount of commercial paper issued and outstanding under the program as of March 31, 2024 and December 31, 2023, respectively.

We have entered into a commercial paper program for the issuance and sale of unsecured commercial paper in an aggregate principal amount not to exceed $ 1.5 billion outstanding at any one time.

The weighted average interest rate for borrowings outstanding as of June 30, 2024 was 5.515 % with a weighted average maturity of 24 days.

We had $ 180.0 million and $ 496.0 million in aggregate principal amount of commercial paper issued and outstanding under the program as of June 30, 2024 and December 31, 2023, respectively.

In the event of a failed re-borrowing, we currently have availability under our Credit Facility to fund the commercial paper program until it is re-borrowed successfully.

Accordingly, we have classified these borrowings as long-term in our consolidated balance sheet as of March 31, 2024.

Accordingly, we have classified these borrowings as long-term in our consolidated balance sheet as of June 30, 2024.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

In March 2023, we issued $ 400.0 million of 4.875 % senior notes due 2029 (the Existing 2029 Notes) and $ 800.0 million of 5.000 % senior notes due 2034 (the 2034 Notes, and together, the Notes).

We used the proceeds from the Notes for general corporate purposes, including the repayment of a portion of amounts outstanding under the Uncommitted Credit Facility, the Commercial Paper Program, the Credit Facility, and the Term Loan Facility.

Senior Notes and Debentures

In March 2023, we issued $ 400.0 million of 4.875 % senior notes due 2029 (the Existing 2029 Notes) and $ 800.0 million of 5.000 % senior notes due 2034.

We used the proceeds from the March 2023 notes issuance for general corporate purposes, including the repayment of a portion of amounts outstanding under the Uncommitted Credit Facility, the Commercial Paper Program, the Credit Facility, and the Term Loan Facility.

As a result of the Term Loan Facility repayment, we incurred a non-cash loss on the early extinguishment of debt related to the ratable portion of unamortized deferred issuance costs of $ 0.2 million.

3 unchanged sentences

In December 2023, we also issued $ 650.0 million of 5.000 % senior notes due 2033 (the 5.000 % 2033 Notes).

The proceeds of the New 2029 Notes and the 2033 Notes were used for general corporate purposes, including the repayment of a portion of amounts outstanding under the Uncommitted Credit Facility, the Commercial Paper Program, the Credit Facility, and the Term Loan Facility.

The proceeds of the December 2023 notes issuance were used for general corporate purposes, including the repayment of a portion of amounts outstanding under the Uncommitted Credit Facility, the Commercial Paper Program, the Credit Facility, and the Term Loan Facility.

In June 2024, we issued $ 400.0 million of 5.000 % senior notes due 2029 (the 5.000 % 2029 Notes) and $ 500.0 million of 5.200 % senior notes due 2034, (the 5.200 % 2034 Notes).

We used the proceeds from the June 2024 notes issuance for general corporate purposes, including the repayment of a portion of amounts outstanding under the Commercial Paper Program and the Credit Facility;

and repayment of the remaining amount outstanding under the Term Loan Facility and the Uncommitted Credit Facility.

Our senior notes and debentures are general unsecured and unsubordinated obligations and rank equally with our other unsecured obligations.

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The fair value of our interest rate locks is determined using standard valuation models with assumptions about interest rates being based on those observed in underlying markets (Level 2 in the fair value hierarchy).

During the three months ended March 31, 2023, we recognized an unrealized gain in other comprehensive loss of $ 1.7 million, net of tax, related to terminated interest rate locks issued in conjunction with the issuance of our 5.000 % Notes in March 2023.

As of March 31, 2024 and December 31, 2023, our previously terminated interest rate locks were recorded as components of accumulated other comprehensive loss of $ 15.0 million and $ 15.9 million, respectively, net of tax.

During the six months ended June 30, 2023, we recognized an unrealized gain in other comprehensive loss of $ 1.7 million, net of tax, related to terminated interest rate locks issued in conjunction with the issuance of our 5.000 % notes in March 2023.

As of June 30, 2024 and December 31, 2023, our previously terminated interest rate locks were recorded as components of accumulated other comprehensive loss of $ 14.1 million and $ 15.9 million, respectively, net of tax.

The effective portion of the interest rate locks is amortized as an adjustment to interest expense over the life of the issued debt using the effective interest method.

For the three months ended March 31, 2024 and 2023, we recognized losses, net of tax, of $ 0.9 million and $ 1.0 million, respectively.

For the three months ended June 30, 2024 and 2023, we recognized losses, net of tax, of $ 0.9 million and $ 1.0 million, respectively.

For the six months ended June 30, 2024 and 2023, we recognized losses, net of tax, of $ 1.7 million and $ 2.0 million, respectively.

Over the next 12 months, we expect to amortize $ 1.1 million, net of tax, from accumulated other comprehensive loss to interest expense as a yield adjustment of our senior notes.

In connection with our acquisition of US Ecology, in the second quarter of 2022, we acquired and novated a floating-to-fixed interest rate swap agreement (the 2022 Interest Rate Swap) with an initial effective date of March 6, 2020, an initial notional amount of $ 500 million relative to our Term Loan Facility and an initial fair value of $ 29.1 million.

The initial fair value is reclassified into earnings as non-cash interest expense on a systematic basis over the life of the interest rate swap.

As of March 31, 2024, the 2022 Interest Rate Swap has a notional value of $ 340 million.

The interest rate swap matures in November 2026.

The goal was to reduce overall borrowing costs.

We pay interest at a fixed interest rate of 0.832 % and receive interest at floating rates based on changes in SOFR.

The interest rate swap is designated as a cash flow hedge.

Changes in the fair value of the interest rate swap are recorded as a component of accumulated other comprehensive loss and are recognized in interest expense in the period in which the payment is settled.

The fair value of our floating-to-fixed swap is determined using standard valuation models with assumptions about interest rates being based on those observed in underlying markets (Level 2 in the fair value hierarchy).

As of March 31, 2024 and December 31, 2023, the 2022 Interest Rate Swap was recorded at its fair value of $ 25.6 million and $ 24.3 million, respectively, and is included in other assets in our consolidated balance sheets.

The initial fair value was reclassified into earnings as non-cash interest expense on a systematic basis over the life of the interest rate swap.

In June 2024, the Company terminated the 2022 Interest Rate Swap and received $ 23.7 million in conjunction with this settlement.

As of December 31, 2023, the 2022 Interest Rate Swap was recorded at its fair value of $ 24.3 million and was included in other assets in our consolidated balance sheets.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

For the three months ended March 31, 2024 and 2023, we recognized unrealized gains of $ 5.1 million and $ 3.5 million, respectively, in accumulated other comprehensive income for the 2022 Interest Rate Swap.

As of March 31, 2024 and December 31, 2023, the 2022 Interest Rate Swap was recorded as a gain within accumulated other comprehensive loss of $ 6.4 million and $ 4.3 million, respectively, net of tax.

The effective portion of the 2022 Interest Rate Swap is amortized as an adjustment to interest expense over the life of the instrument using the effective interest method.

For the three months ended March 31, 2024 and 2023, we recognized gains, net of tax, of $ 3.0 million and $ 3.6 million, respectively, related to this amortization.

Over the next 12 months, we expect to amortize approximately $ 5 million, net of tax, from accumulated other comprehensive loss as an offset to interest expense in the period in which payments are settled.

For the three and six months ended June 30, 2024, we recognized unrealized gains of $ 1.2 million and $ 6.3 million, respectively, in accumulated other comprehensive income for the 2022 Interest Rate Swap.

For the three and six months ended June 30, 2023, we recognized unrealized gains of $ 7.3 million and $ 10.8 million, respectively, in accumulated other comprehensive income for the 2022 Interest Rate Swap.

As of December 31, 2023, the 2022 Interest Rate Swap was recorded as a gain within accumulated other comprehensive loss of $ 4.3 million, net of tax.

For the three and six months ended June 30, 2024, we recognized gains, net of tax, of $ 7.7 million and $ 10.6 million, respectively.

For the three and six months ended June 30, 2023, we recognized gains, net of tax, of $ 3.2 million and $ 6.8 million, respectively, related to this amortization.

For further detail regarding the effect of our cash flow hedging on interest expense, refer to Note 11, Financial Instruments , of the notes to our unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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There was no ineffectiveness recognized in the termination of these cash flow hedges.

In addition, we entered into offsetting interest rate swaps to offset future exposures to fair value fluctuations of the Extended Interest Rate Locks (2019 Offsetting Interest Rate Swap and the 2020 Offsetting Interest Rate Swap, or collectively the Offsetting Interest Rate Swaps).

In addition, we entered into interest rate swaps to offset future exposures to fair value fluctuations of the Extended Interest Rate Locks (2019 Offsetting Interest Rate Swap and the 2020 Offsetting Interest Rate Swap, or collectively the Offsetting Interest Rate Swaps).

The fair value of these free-standing derivatives was determined using standard valuation models with assumptions about interest rates being based on those observed in underlying markets (Level 2 in the fair value hierarchy).

As of March 31, 2024 and December 31, 2023, the fair value of the Extended Interest Rate Locks were assets of $ 67.4 million and $ 54.0 million, respectively, which were included in prepaid and other current assets and other assets in our consolidated balance sheets.

As of March 31, 2024 and December 31, 2023, the fair value of the Offsetting Interest Rate Swaps were liabilities of $ 87.8 million and $ 78.2 million, respectively, which were included in other accrued liabilities and other long-term liabilities in our consolidated balance sheets.

For the three months ended March 31, 2024, we recognized a gain of $ 13.6 million on the change in fair value of the Extended Interest Rate Locks with an offsetting loss of $ 13.6 million on the change in fair value of the Offsetting Interest Rate Swaps.

For the three months ended March 31, 2023, we recognized a loss of $ 9.8 million on the change in fair value of the Extended Interest Rate Locks with an offsetting gain of $ 8.7 million on the change in fair value of the Offsetting Interest Rate Swaps.

As of June 30, 2024, the fair value of the Extended Interest Rate Locks were assets of $ 59.3 million, which were included in other assets in our consolidated balance sheet.

As of December 31, 2023, the fair value of the Extended Interest Rate Locks were assets of $ 54.0 million, which were included in prepaids and other current assets and other assets in our consolidated balance sheets.

As of June 30, 2024 and December 31, 2023, the fair value of the Offsetting Interest Rate Swaps were liabilities of $ 79.9 million and $ 78.2 million, respectively, which were included in other accrued liabilities and other long-term liabilities in our consolidated balance sheets.

For the three months ended June 30, 2024 and 2023, we recognized losses of $ 8.0 million and gains of $ 9.2 million, respectively, on the change in fair value of the Extended Interest Rate Locks with offsetting gains of $ 7.9 million and losses of $ 9.4 million, respectively, on the change in fair value of the Offsetting Interest Rate Swaps.

For the six months ended June 30, 2024 and 2023, we recognized gains of $ 5.5 million and losses of $ 4.6 million, respectively, on the change in fair value of the Extended Interest Rate Locks with offsetting losses of $ 5.6 million and gains of $ 3.3 million, respectively, on the change in fair value of the Offsetting Interest Rate Swaps.

The changes in fair value were recorded directly in earnings as an adjustment to interest expense in our consolidated statements of income.

Tax-Exempt Financings

As of March 31, 2024 and December 31, 2023, we had $ 1,379.8 million and $ 1,280.6 million, respectively, of certain variable rate tax-exempt financings outstanding, with maturities ranging from 2024 to 2054 and from 2024 to 2053, respectively.

In both March 2024 and September 2023, the California Municipal Finance Authority issued, for our benefit, $ 100 million of Solid Waste Disposal Revenue Bonds each.

As of June 30, 2024 and December 31, 2023, we had $ 1,429.4 million and $ 1,280.6 million, respectively, of certain variable rate tax-exempt financings outstanding, with maturities ranging from 2024 to 2054 and from 2024 to 2053, respectively.

In June 2024, the Mission Economic Development Corporation issued, for our benefit, $ 50 million in principal amount of Solid Waste Disposal Revenue Bonds.

The proceeds from the issuances, after deferred issuance costs, were used to fund the acquisition, construction, improvement, installation, and/or equipping of certain solid waste disposal facilities located within Texas.

In both March 2024 and September 2023, the California Municipal Finance Authority issued, for our benefit, $ 100 million in principal amount of Solid Waste Disposal Revenue Bonds.

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In the event of a failed remarketing, we currently have availability under our Credit Facility to fund these bonds until they are remarketed successfully.

Accordingly, we classified these borrowings as long-term in our consolidated balance sheets as of March 31, 2024 and December 31, 2023.

Finance Leases

As of March 31, 2024 and December 31, 2023, we had finance lease liabilities of $ 259.0 million and $ 251.3 million, respectively, with maturities ranging from 2024 to 2063 for both periods.

Accordingly, we classified these borrowings as long-term in our consolidated balance sheets as of June 30, 2024 and December 31, 2023.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Our effective tax rate, exclusive of non-controlling interests, for the three months ended March 31, 2024 and 2023 was 24.2 % and 26.5 %, respectively.

Our effective tax rate for the three months ended March 31, 2024 reflected benefits from investments in renewable energy assets qualifying for tax credits under Section 48 of the Internal Revenue Code.

For the three months ended March 31, 2024 and 2023, net cash paid for income taxes was $ 7.8 million and $ 7.7 million, respectively.

Finance Leases

As of June 30, 2024 and December 31, 2023, we had finance lease liabilities of $ 276.5 million and $ 251.3 million, respectively, with maturities ranging from 2024 to 2063 for both periods.

Our effective tax rate, exclusive of non-controlling interests, for the three and six months ended June 30, 2024 was 21.7 % and 22.9 %, respectively.

Our effective tax rate, exclusive of non-controlling interests, for the three and six months ended June 30, 2023 was 26.3 % and 26.4 %, respectively.

Our effective tax rate for the three and six months ended June 30, 2024 reflects a benefit of $ 32.6 million and $ 41.0 million, respectively, due to our investments in renewable energy assets qualifying for tax credits under Section 48 of the Internal Revenue Code.

For the six months ended June 30, 2024 and 2023, net cash paid for income taxes was $ 109.3 million and $ 88.0 million, respectively.

We have deferred tax assets related to state net operating loss carryforwards.

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We continue to regularly monitor both positive and negative evidence in determining the ongoing need for a valuation allowance.

As of March 31, 2024, the valuation allowance associated with our state loss carryforwards was $ 43.6 million.

As of June 30, 2024, the valuation allowance associated with our state loss carryforwards was $ 43.5 million.

We are subject to income tax in the United States, as well as income tax in multiple state and foreign jurisdictions.

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However, a significant assessment against us in excess of the liabilities recorded could have a material adverse effect on our consolidated financial position, results of operations and cash flows.

As of March 31, 2024, we are unable to estimate the resolution of our gross unrecognized benefits over the next 12 months.

As of June 30, 2024, we are unable to estimate the resolution of our gross unrecognized benefits over the next 12 months.

We recognize interest and penalties as incurred within the provision for income taxes in the consolidated statement of income.

As of March 31, 2024, we accrued a liability for penalties of $ 0.3 million and a liability for interest (including interest on penalties) of $ 14.2 million related to our uncertain tax positions.

As of June 30, 2024, we accrued a liability for penalties of $ 0.3 million and a liability for interest (including interest on penalties) of $ 12.6 million related to our uncertain tax positions.

STOCK REPURCHASES, DIVIDENDS AND EARNINGS PER SHARE

6 unchanged sentences

While the Board of Directors has approved the program, the timing of any purchases, the prices and the number of shares of common stock to be purchased will be determined by our management, at its discretion, and will depend upon market conditions and other factors.

On a quarterly basis, our Board of Directors reviews the intrinsic value of our stock and the parameters around which we repurchase our shares.

On a quarterly basis, our Board of Directors reviews the parameters around which we repurchase our shares.

The share repurchase program may be extended, suspended or discontinued at any time.

During both the three months ended March 31, 2024 and 2023, there were no shares repurchased and as of both March 31, 2024 and 2023, no repurchased shares pending settlement.

As of March 31, 2024, the remaining authorized purchase capacity under our October 2023 repurchase program was $ 3.0 billion.

In February 2024, our Board of Directors approved a quarterly dividend of $ 0.535 per share.

Cash dividends declared were $ 168.5 million for the three months ended March 31, 2024.

As of March 31, 2024, we recorded a quarterly dividend payable of $ 168.5 million to shareholders of record at the close of business on April 2, 2024.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Stock repurchase activity during three and six months ended June 30, 2024 and 2023 follows (in millions, except per share amounts):

Three Months Ended June 30,

Six Months Ended June 30,

2024 2023 2024 2023

Number of shares repurchased 0.9 — 0.9 —

$ 167.6 $ — $ 167.6 $ —

Weighted average cost per share $ 186.24 $ — $ 186.24 $ —

The average price paid per share, total repurchase costs and approximate maximum dollar value of the shares that may yet be purchased under the plans or programs exclude a 1% excise tax.

As of June 30, 2024 and 2023, no repurchased shares were pending settlement.

As of June 30, 2024, the remaining authorized purchase capacity under our October 2023 repurchase program was $ 2.8 billion.

In April 2024, our Board of Directors approved a quarterly dividend of $ 0.535 per share.

Cash dividends declared were $ 336.5 million for the six months ended June 30, 2024.

As of June 30, 2024, we recorded a quarterly dividend payable of $ 168.0 million to shareholders of record at the close of business on July 2, 2024.

Earnings per Share

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We use the treasury stock method in computing diluted earnings per share.

Earnings per share for the three months ended March 31, 2024 and 2023 are calculated as follows (in thousands, except per share amounts):

Three Months Ended March 31,

Earnings per share for the three and six months ended June 30, 2024 and 2023 are calculated as follows (in thousands, except per share amounts):

Three Months Ended June 30,

Six Months Ended June 30,

2024 2023 2024 2023

Basic earnings per share:

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Unvested PSU awards

211 359 316 357

Weighted average common and common equivalent shares outstanding

1 unchanged sentence

Diluted earnings per share $ 1.62 $ 1.35 $ 3.06 $ 2.56

During the three months ended March 31, 2024 and 2023, there were no antidilutive securities outstanding and less than 0.1 million antidilutive securities outstanding, respectively.

During the three and six months ended June 30, 2024 there were no antidilutive securities outstanding.

During the three and six months ended June 30, 2023 there were less than 0.1 million antidilutive securities outstanding.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

CHANGES IN ACCUMULATED OTHER COMPREHENSIVE LOSS BY COMPONENT

A summary of changes in accumulated other comprehensive loss, net of tax, by component, for the three months ended March 31, 2024 follows:

A summary of changes in accumulated other comprehensive loss, net of tax, by component, for the six months ended June 30, 2024 follows:

Cash Flow Hedges Defined Benefit Pension Items Foreign Currency Translation Total

4 unchanged sentences

Net current period other comprehensive income ( 2.5 ) — 5.5 3.0

Balance as of March 31, 2024

Balance as of June 30, 2024

$ ( 14.1 ) $ 8.9 $ ( 3.9 ) $ ( 9.1 )

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

A summary of reclassifications out of accumulated other comprehensive loss for the three months ended March 31, 2024 and 2023 follows:

Three Months Ended March 31,

Details about Accumulated Other Comprehensive Loss Components Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in the Statement where Net Income is Presented

A summary of reclassifications out of accumulated other comprehensive loss for the three and six months ended June 30, 2024 and 2023 follows:

Three Months Ended June 30,

Six Months Ended June 30,

2024 2023 2024 2023

Details about Accumulated Other Comprehensive Loss Components Amount Reclassified from Accumulated Other Comprehensive Loss Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in the Statement where Net Income is Presented

Gain (loss) on cash flow hedges:

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Total income reclassified into earnings, net of tax $ 6.8 $ 2.2 $ 8.9 $ 4.8

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

FINANCIAL INSTRUMENTS

The effect of our hedging relationships and derivative instruments on the consolidated statements of income for the three months ended March 31, 2024 and 2023 follows (in millions):

The effect of our hedging relationships and derivative instruments on the consolidated statements of income for the three and six months ended June 30, 2024 and 2023 follows (in millions):

Classification and amount of gain (loss) recognized in income on hedging relationships and derivative instruments

Three Months Ended March 31,

Interest Expense Interest Expense

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Interest Expense Interest Expense Interest Expense Interest Expense

Total amount of expense line items presented in the consolidated statements of income in which the effects of hedging relationships and derivative instruments are recorded $ ( 128.3 ) $ ( 124.4 ) $ ( 267.6 ) $ ( 251.1 )

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(Loss) gain on cash flow hedging relationships:

Amount of (loss) gain reclassified from accumulated other comprehensive loss into earnings, net of tax:

Interest rate swap locks $ ( 0.9 ) $ ( 1.0 ) $ ( 1.7 ) $ ( 2.0 )

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The effects of derivative instruments not in Subtopic 815-20:

Gain (loss) on free-standing derivative instruments:

Loss on free-standing derivative instruments:

Interest rate contract:

Net gain (loss) on change in fair value of free-standing derivative instruments $ — $ ( 1.1 )

Net loss on change in fair value of free-standing derivative instruments $ ( 0.1 ) $ ( 0.2 ) $ ( 0.1 ) $ ( 1.3 )

Fair Value Measurements

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The carrying value for certain of our financial instruments, including cash, accounts receivable, current investments, accounts payable and certain other accrued liabilities, approximates fair value because of their short-term nature.

As of March 31, 2024 and December 31, 2023, our assets and liabilities that are measured at fair value on a recurring basis include the following:

March 31, 2024

As of June 30, 2024 and December 31, 2023, our assets and liabilities that are measured at fair value on a recurring basis include the following:

June 30, 2024

Carrying Amount Total Quoted

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77.1 77.1 — 77.1 —

Derivative and hedging assets - prepaid and other current assets and other assets 93.0 93.0 — 93.0 —

Derivative and hedging assets - other assets 59.3 59.3 — 59.3 —

Total assets $ 181.5 $ 181.5 $ 45.1 $ 136.4 $ —

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Total liabilities $ 143.2 $ 143.2 $ — $ 79.6 $ 63.6

The carrying value of our total debt was $ 12.8 billion as of both March 31, 2024 and December 31, 2023, and the fair value of our total debt was $ 12.3 billion and $ 12.5 billion, respectively.

The carrying value of our total debt was $ 13.0 billion and $ 12.8 billion as of June 30, 2024 and December 31, 2023, respectively, and the fair value of our total debt was $ 12.3 billion and $ 12.5 billion as of June 30, 2024 and December 31, 2023, respectively.

The estimated fair value of our fixed rate senior notes and debentures is based on quoted market prices.

The fair value of our remaining notes payable, tax-exempt financings and borrowings under our credit facilities approximates the carrying value because the interest rates are variable.

The fair value estimates were based on Level 2 inputs of the fair value hierarchy as of March 31, 2024 and December 31, 2023.

The fair value estimates were based on Level 2 inputs of the fair value hierarchy as of June 30, 2024 and December 31, 2023.

See Note 7, Debt , for further information related to our debt.

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In 2015, we entered into a waste management contract with the County of Sonoma, California to operate the county's waste management facilities.

As of March 31, 2024, the Sonoma contingent consideration represents the fair value of $ 59.0 million

As of June 30, 2024, the Sonoma contingent consideration represents the fair value of $ 59.2 million

REPUBLIC SERVICES, INC.

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The potential undiscounted amount of all future contingent payments that we could be required to make under the waste management contract is estimated to be between approximately $ 81 million and $ 114 million.

During the three months ended March 31, 2024, the activity in the contingent consideration liability included accretion, which was offset by concession payments made in the ordinary course of business.

During the six months ended June 30, 2024, the activity in the contingent consideration liability included accretion, which was offset by concession payments made in the ordinary course of business.

There were no changes to the estimate of fair value.

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Adjusted EBITDA is the single financial measure our chief operating decision maker (CODM) uses to evaluate operating segment profitability and determine resource allocations.

Summarized financial information concerning our reportable segments for the three months ended March 31, 2024 and 2023 follows:

Summarized financial information concerning our reportable segments for the three months ended June 30, 2024 and 2023 follows:

Group 1 Group 2 Recycling & Waste Subtotal (1)

(Environmental Solutions) Corporate entities and other Total

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Gross Revenue $ 2,090.8 $ 2,004.5 $ 4,095.3 $ 480.5 $ 87.4 $ 4,663.2

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Total Assets $ 13,659.3 $ 10,954.4 $ 24,613.7 $ 4,448.1 $ 2,872.3 $ 31,934.1

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

Gross Revenue $ 1,933.7 $ 1,907.6 $ 3,841.3 $ 419.5 $ 60.6 $ 4,321.4

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(1) The Recycling & Waste Subtotal represents the combined results of our Group 1 and Group 2 reportable segments.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Summarized financial information concerning our reportable segments for the six months ended June 30, 2024 and 2023 follows:

Group 1 Group 2 Recycling & Waste Subtotal (1)

(Environmental Solutions) Corporate entities and other Total

Six Months Ended June 30, 2024

Gross Revenue $ 4,108.8 $ 3,917.7 $ 8,026.5 $ 909.5 $ 166.5 $ 9,102.5

Intercompany Revenue ( 615.1 ) ( 518.3 ) ( 1,133.4 ) ( 24.5 ) ( 34.8 ) ( 1,192.7 )

Revenue allocations 62.5 58.3 120.8 10.9 ( 131.7 ) —

Net Revenue $ 3,556.2 $ 3,457.7 $ 7,013.9 $ 895.9 $ — $ 7,909.8

Adjusted EBITDA $ 1,149.2 $ 1,074.2 $ 2,223.4 $ 198.9 $ — $ 2,422.3

Capital Expenditures $ 318.1 $ 257.8 $ 575.9 $ 60.6 $ 281.4 $ 917.9

Total Assets $ 13,659.3 $ 10,954.4 $ 24,613.7 $ 4,448.1 $ 2,872.3 $ 31,934.1

Six Months Ended June 30, 2023

Gross Revenue $ 3,774.0 $ 3,725.9 $ 7,499.9 $ 840.6 $ 128.0 $ 8,468.5

Intercompany Revenue ( 586.5 ) ( 502.5 ) ( 1,089.0 ) ( 29.4 ) ( 43.1 ) ( 1,161.5 )

Revenue allocations 45.6 43.9 89.5 ( 4.6 ) ( 84.9 ) —

Net Revenue $ 3,233.1 $ 3,267.3 $ 6,500.4 $ 806.6 $ — $ 7,307.0

Adjusted EBITDA $ 1,016.6 $ 964.3 $ 1,980.9 $ 175.3 $ — $ 2,156.2

Capital Expenditures $ 247.3 $ 241.8 $ 489.1 $ 38.2 $ 187.0 $ 714.3

Total Assets $ 13,024.0 $ 10,780.1 $ 23,804.1 $ 3,971.5 $ 2,047.7 $ 29,823.3

(1) The Recycling & Waste Subtotal represents the combined results of our Group 1 and Group 2 reportable segments.

Corporate functions include legal, tax, treasury, information technology, risk management, human resources, closed landfills, and other administrative functions.

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This presentation is consistent with how our CODM reviews results of operations to make resource allocation decisions.

Intercompany revenue reflects transactions within and between segments that generally are made on a basis intended to reflect

Intercompany revenue reflects transactions within and between segments that generally are made on a basis intended to reflect the market value of such services.

Capital expenditures for Corporate entities and other primarily include vehicle inventory acquired but not yet assigned to operating locations and facilities.

REPUBLIC SERVICES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

the market value of such services.

Capital expenditures for Corporate entities and other primarily include vehicle inventory acquired but not yet assigned to operating locations and facilities.

A reconciliation of the Company's single measure of segment profitability (segment Adjusted EBITDA) to Income before income tax provision in the Consolidated Statements of Net Income is as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Group 1 Adjusted EBITDA $ 590.3 $ 527.1 $ 1,149.2 $ 1,016.6

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acquisition integration and deal costs — 10.6 — 18.2

Gain on business divestitures and impairments, net ( 1.4 ) — ( 1.4 ) —

Income before income taxes $ 654.0 $ 580.2 $ 1,252.9 $ 1,102.3

3 unchanged sentences

Our operations primarily consist of providing environmental services.

The following table disaggregates our revenue by service line for the three months ended March 31, 2024 and 2023 (in millions of dollars and as a percentage of revenue):

Three Months Ended March 31,

The following table disaggregates our revenue by service line for the three months ended June 30, 2024 and 2023 (in millions of dollars and as a percentage of revenue):

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

$ 733.4 18.1 % $ 700.2 18.8 % $ 1,456.6 18.4 % $ 1,385.3 18.9 %

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45 unchanged sentences

Depending on the nature of the contract, we may also generate revenue through the collection of fuel recovery fees and environmental fees which are designed to recover our internal costs of providing services to our customers.

Substantially all of the deferred revenue recognized as of December 31, 2023 was recognized as revenue during the three months ended March 31, 2024 when the service was performed.

Substantially all of the deferred revenue recognized as of December 31, 2023 was recognized as revenue during the six months ended June 30, 2024 when the service was performed.

Deferred Contract Costs

1 unchanged sentence

In addition, we recognize sales commissions that represent an incremental cost of the contract as other assets in our consolidated balance sheets, and we amortize the asset over the average life of the customer relationship.

As of March 31, 2024 and December 31, 2023, we recognized $ 82.1 million and $ 82.5 million, respectively, of deferred contract costs and capitalized sales commissions.

During the three months ended March 31, 2024, we amortized $ 3.8 million of capitalized sales commissions to selling, general and administrative expenses and we amortized $ 1.1 million of other deferred contract costs as a reduction of revenue.

During the three months ended March 31, 2023, we amortized $ 3.6 million of capitalized sales commissions to selling, general and administrative expenses and we amortized $ 1.3 million of other deferred contract costs as a reduction of revenue.

As of June 30, 2024 and December 31, 2023, we recognized $ 81.3 million and $ 82.5 million, respectively, of deferred contract costs and capitalized sales commissions.

During the three and six months ended June 30, 2024, we amortized $ 4.0 million and $ 7.8 million, respectively, of capitalized sales commissions to selling, general and administrative expenses and we amortized $ 1.0 million and $ 2.1 million, respectively, of other deferred contract costs as a reduction of revenue.

During the three and six months ended June 30, 2023, we amortized $ 3.7 million and $ 7.3 million, respectively, of capitalized sales commissions to selling, general and administrative expenses and we amortized $ 1.4 million and $ 2.7 million, respectively, of other deferred contract costs as a reduction of revenue.

Credit Losses

7 unchanged sentences

We perform ongoing credit evaluations of our customers, but generally do not require collateral to support customer receivables.

The following table reflects the activity in our allowance for doubtful accounts for the three months ended March 31, 2024 and 2023:

The following table reflects the activity in our allowance for doubtful accounts for the six months ended June 30, 2024 and 2023:

Balance at beginning of year $ 83.2 $ 51.9

14 unchanged sentences

We accrue for legal proceedings when losses become probable and reasonably estimable.

We have recorded an aggregate accrual of approximately $ 18 million relating to our outstanding legal proceedings as of March 31, 2024.

We have recorded an aggregate accrual of approximately $ 15 million relating to our outstanding legal proceedings as of June 30, 2024.

As of the end of each applicable reporting period, we review each of our legal proceedings and, where it is probable that a liability has been incurred, we accrue for all probable and reasonably estimable losses.

1 unchanged sentence

If we can reasonably estimate a range but no amount within the range appears to be a better estimate than any other, we use the amount that is the low end of such range.

If we had used the high ends of such ranges, our aggregate potential liability would be approximately $ 13 million higher than the amount recorded as of March 31, 2024.

If we had used the high ends of such ranges, our aggregate potential liability would be approximately $ 9 million higher than the amount recorded as of June 30, 2024.

Multiemployer Pension Plans

7 unchanged sentences

Beginning-of-period and end-of-period cash, cash equivalents, restricted cash and restricted cash equivalents as presented in the statement of cash flows is reconciled as follows:

March 31, 2024 December 31, 2023 March 31, 2023 December 31, 2022

June 30, 2024 December 31, 2023 June 30, 2023 December 31, 2022

Cash and cash equivalents $ 490.6 $ 140.0 $ 181.6 $ 143.4

4 unchanged sentences

The following table summarizes our restricted cash and marketable securities:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Capping, closure and post-closure obligations $ 42.8 $ 43.2

6 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements