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The call was broadly positive: the company reported record first-quarter adjusted EBITDA margins, strong price realization (7% Q1 pricing), revenue growth of ~8.5% (pre-FX), underlying volume resilience excluding difficult prior-year comps, continued cost-efficiency gains, successful bond issuance and active M&A that led to an upward revision of full-year guidance. Offsetting items include temporary volume weakness in C&D and weather-related impacts, a near-term diesel cost spike that created a ~$10M headwind (to be largely recovered through surcharges), FX translational impacts on leverage, Q2 margin headwinds from commodities/fuel/M&A, and some investor pushback on the SECURE transaction and its near-term equity-market implications. On balance the company highlighted multiple levers for upside (commodity recovery, pricing retention, cost synergies and continued M&A), and management expects the headwinds to be manageable and largely recoverable.
GFL updated full‑year 2026 guidance to reflect eight acquisitions closed year‑to‑date, now targeting revenue of $7.32–7.34 billion, adjusted EBITDA of $2.23 billion and adjusted free cash flow of $850 million (inclusive of $445 million cash interest and $825 million net CapEx); Q2 guidance is revenue of ~$1.89–1.90 billion, an adjusted EBITDA margin of 30.4% and adjusted free cash flow of ~ $225 million (inclusive of $85 million cash interest and $265 million net CapEx). The company reiterated its base‑business guide is unchanged and highlighted Q1 outperformance (Q1 revenues +8.5%, pricing 7% — Canada 8.5%, U.S. 6.3% — Q1 adjusted EBITDA margin 29.1%, +180 bps YoY, adjusted free cash flow ~ $20 million ahead of plan), volume dynamics (Q1 volumes -120 bps YoY but +80 bps ex hurricane and one‑time transfer station comps), commodity momentum (market pricing ~$15/ton above initial outlook; sensitivity: $10 change ≈ $6 million revenue/EBITDA), costs (cost of sales ex D&A down 90 bps to 60.7%; diesel ~+10% YoY, +40% in March causing a ~$10 million headwind with only ~$1 million recovered in Q1 but expected surcharge recovery by end‑Q2), balance sheet actions ($1.0 billion bond issuance, net leverage exited Q1 at 3.6x — 3.5x on average FX — and will tick ~30 bps higher after Q2 acquisitions before returning to mid‑3s), a $300–500 million deployable M&A pipeline remaining, and the proposed SECURE transaction (2026 revenue $1.5–1.6 billion, $25 million identified SG&A synergies plus an incremental $25–50 million of operational/revenue opportunities, i.e., $50–75 million total potential).
Adjusted EBITDA margin expanded 180 basis points year-over-year to 29.1%, the highest first-quarter adjusted EBITDA margin in company history, with underlying consolidated Q1 margins up over 230 basis points excluding exogenous factors.
Q1 revenues grew 8.5% (before FX translational effects). Pricing was +7.0% for the quarter (Canada +8.5%, U.S. +6.3%), ~25 basis points better than plan, providing increased visibility to meeting or exceeding full-year pricing guidance.
Adjusted for lapping prior-year hurricane and one-time transfer station volumes, underlying volumes improved roughly 80 basis points year-over-year, driven by special waste and EPR activity despite outsized winter storms.
Cost of sales (ex D&A and integration) decreased 90 basis points to 60.7% of revenue; this marks the fifth consecutive quarter of year-over-year reductions in operational and SG&A cost intensity, driven by improved labor turnover, fleet optimization and procurement benefits.
Adjusted free cash flow for the quarter was approximately $20 million ahead of plan. The company opportunistically issued $1.0 billion of bonds (significantly oversubscribed with one of the tightest spreads for its rating category) to support growth.
Completed 8 acquisitions year-to-date (including Frontier Waste Solutions) which increased 2026 guidance by nearly 5%. Reported full-year 2026 guidance updated to revenue $7.32–7.34B, adjusted EBITDA $2.23B and adjusted free cash flow $850M; company still has a pipeline to deploy an incremental $300M–$500M this year.
Proposed SECURE acquisition would add a hard-to-replicate Western Canada disposal network with expected 2026 revenue of $1.5–1.6B. Identified ~$25M of SG&A savings with an incremental $25M–$50M of operational/revenue synergies possible (total $25M–$75M), and management highlighted stable production-tied volumes (>80%) and strong structural tailwinds in the region.
Average commodity prices showed sequential increases and are now ~$15/ton higher than the initial 2026 outlook. Management noted a sensitivity where each $10/ton change in the gross basket price equates to ~$6M annual revenue and adjusted EBITDA, creating potential incremental upside if prices hold.
Hello, everyone, and thank you for joining the GFL First Quarter 2026 Earnings Call. My name is Lucy, and I'll be coordinating your call today. [Operator Instructions]. It is now my pleasure to hand over to Patrick Dovigi, Founder and CEO of GFL to begin. Please go ahead.
Thank you, and good morning. I would like to welcome everyone to today's call, and thank you for joining us. This morning, we will be reviewing our results for the first quarter. I am joined this morning by Luke Pelosi, our CFO, who will take us through our forward-looking disclaimer before we get into details.
Thank you, Patrick. Good morning, everyone, and thank you for joining. We have filed our earnings press release, which includes important information. The press release is available on our website. During this call, we will be making some forward-looking statements within the meaning of applicable Canadian and U.S. securities laws, including statements regarding events or developments that we believe or anticipate may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set out in our filings with the Canadian and U.S. securities regulators.
Any forward-looking statement is not a guarantee of future performance, and actual results may differ materially from those expressed or implied in the forward-looking statements. These forward-looking statements speak only as of today's date, and we do not assume any obligation to update these statements, whether as a result of new information, future events and developments or otherwise. This ...