WASTE CONNECTIONS, INC. Management's Discussion and Analysis of Financial Condition and Results of Operations (form 10-Q)

FORWARD-LOOKING STATEMENTS

The following discussion should be read in conjunction with our Condensed Consolidated Financial Statements and the related notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

We make statements in this Quarterly Report on Form 10-Q that are forward-looking in nature. These include:

Statements regarding our landfills, including capacity, duration, special

? projects, demand for and pricing of recyclables, landfill alternatives and

related capital expenditures;

? Discussion of competition, loss of contracts, price increases and additional

exclusive and/or long-term collection service arrangements;

Forecasts of cash flows necessary for operations and free cash flow to reduce

? leverage as well as our ability to draw on our credit facility and access the

capital markets to refinance or expand;

? Statements regarding our ability to access capital resources or credit markets

at all or on favorable terms;

? Plans for, and the amounts of, certain capital expenditures for our existing

and newly acquired properties and equipment;

? Statements regarding fuel, oil and natural gas demand, prices, and price

volatility;

? Assessments of regulatory developments and potential changes in environmental,

health, safety and tax laws and regulations; and

Other statements on a variety of topics such as the COVID-19 pandemic, credit

? risk of customers, seasonality, labor/pension costs and labor union activity,

operational and safety risks, acquisitions, litigation results, goodwill

impairments, insurance costs and cybersecurity threats.

These statements can be ?identified by the use of forward-looking terminology
such as "believes," "expects," "intends," "may," "might," "will," ??"could,"
"should" or "anticipates," or the negative thereof or comparable terminology, or
by discussions of strategy.

Our ?business and operations are subject to a variety of risks and uncertainties
and, consequently, actual results may differ ?materially from those projected by
any forward-looking statements. Factors that could cause actual results to
differ ?from those projected include, but are not limited to, risk factors
detailed from time to time in our filings with the SEC and the securities
commissions or similar regulatory authorities in Canada.

There may be additional risks of which we are not presently aware or that we
currently believe are immaterial that ?could have an adverse impact on our
business. We make no commitment to revise or update any forward-looking
?statements to reflect events or circumstances that may change, unless required
under applicable securities laws.

OVERVIEW OF OUR BUSINESS

We are an integrated solid waste services company that provides non-hazardous
waste collection, transfer and disposal services, along with recycling and
resource recovery, in mostly exclusive and secondary markets across 44 states in
the U.S. and six provinces in Canada. Waste Connections also provides
non-hazardous oilfield waste treatment, recovery and disposal services in
several basins across the U.S., as well as intermodal services for the movement
of cargo and solid waste containers in the Pacific Northwest.

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Environmental, organizational and financial sustainability initiatives have been
key components of our success since we were founded in 1997.  We remain
committed to growing and expanding these efforts as our industry and technology
continue to evolve. To that end, we have made a $500 million commitment to the
advancement of the long-term, aspirational targets outlined in our 2021
Sustainability Report. This report can be found at
www.wasteconnections.com/sustainability but does not constitute a part of, and
is not incorporated by reference into, this Quarterly Report on Form 10-Q.

We generally seek to avoid highly competitive, large urban markets and instead
target markets where we can attain high market share either through exclusive
contracts, vertical integration or asset positioning. In markets where waste
collection services are provided under exclusive arrangements, or where waste
disposal is municipally owned or funded or available at multiple municipal
sources, we believe that controlling the waste stream by providing collection
services under exclusive arrangements is often more important to our growth and
profitability than owning or operating landfills. We also target niche markets,
like E&P waste treatment and disposal services.

As of September 30, 2021, we served residential, commercial, industrial and E&P
customers in 44 states in the U.S. and six provinces in Canada:  Alabama,
Alaska, Arizona, Arkansas, California, Colorado, Delaware, Florida, Georgia,
Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maryland, Massachusetts,
Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New
Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota,
Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota,
Tennessee, Texas, Utah, Vermont, Virginia, Washington, Wisconsin and Wyoming,
and the provinces of Alberta, British Columbia, Manitoba, Ontario, Québec and
Saskatchewan.

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

Generally, the most profitable operators within the solid waste industry are
those companies that are vertically integrated or enter into long-term
collection contracts. A vertically integrated operator will benefit from:
(1) the internalization of waste, which is bringing waste to a company-owned
landfill; (2) the ability to charge third-party haulers tipping fees either at
landfills or at transfer stations; and (3) the efficiencies gained by being able
to aggregate and process waste at a transfer station prior to landfilling.

The demand for our E&P waste services depends on the continued demand for, and
production of, oil and natural gas. Crude oil and natural gas prices
historically have been volatile. Macroeconomic and geopolitical conditions,
including a significant decline in oil prices driven by both surplus production
and supply, as well as the decrease in demand caused by factors including the
COVID-19 pandemic, have resulted in decreased levels of oil and natural gas
exploration and production activity and a corresponding decrease in demand for
our E&P waste services.  Additionally, across the industry there is uncertainty
regarding future demand for oil and related services, as noted by several energy
companies, many of whom are customers of our E&P operations.  These companies
have written down the values of their oil and gas assets in anticipation of the
potential for the decarbonization of their energy product mix given an increased
global focus on reducing greenhouse gases and addressing climate change.  Such
uncertainty regarding global demand has had a significant impact on the
investment and operating plans of our E&P waste customers in the basins where we
operate.   If the prices of crude oil and natural gas substantially decline, it
could lead to declines in the level of production activity and demand for our
E&P waste services, which could result in the recognition of additional
impairment charges on our intangible assets and property and equipment
associated with our E&P operations.  See Note 4 to our Condensed Consolidated
Financial Statements included in Part 1, Item 1 of this Quarterly Report on Form
10-Q for a discussion of the impairment charge recorded during the nine months
ended September 30, 2020.

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THE COVID-19 PANDEMIC'S IMPACT ON OUR RESULTS OF OPERATIONS

March 11, 2021 marked the one year anniversary of COVID-19 being declared a
global pandemic by the World Health Organization. The related economic
disruptions largely associated with closures or restrictions put into effect
following the onset of the COVID-19 pandemic resulted in declines in solid waste
commercial collection, transfer station and landfill volumes, and roll off
activity. Throughout the remaining fiscal year 2020, solid waste revenue and
reported volumes largely reflected the pace and shape of the closures and
subsequent reopening activity, with the timing and magnitude of recovery varying
by market. Reported solid waste volumes in 2020 turned slightly negative in the
first quarter, were most negative in the second quarter, and showed sequential
improvement during the second half of the year, finishing the year at negative
3.1% in the fourth quarter. In the first quarter of 2021, the final period to
include comparisons to pre-COVID-19 activity levels on a year over year basis,
solid waste volumes were down 3.2%.  In the second quarter of 2021, solid waste
volumes increased sequentially by 9.6% to up 6.5% on a year over year basis,
with positive volumes in all regions. In the third quarter, volumes remained
positive but declined sequentially to up 2.1% on a year over year basis,
reflecting tougher comparisons to the prior year given the sequential
improvement in the second half of 2020 as a result of reopening activity.

The COVID-19 pandemic also contributed to the decline in demand for and the
value of crude oil, which impacted E&P drilling activity and resulted in lower
E&P waste revenue, with the quarterly run rate decreasing from approximately $60
million in the first quarter of 2020 to approximately $25 million through the
first quarter of 2021.   E&P waste revenue increased sequentially by $6.5
million to $31.2 million in the second quarter of 2021 on increased drilling
activity in several active shale basins and increased sequentially again in the
third quarter of 2021 to $35.0 million.

Since the onset of the COVID-19 pandemic, protecting the health, welfare and
safety of our employees has been our top priority. Recognizing the potential for
financial hardship and other challenges, we have looked to provide a safety net
for our employees on issues of income and family health. To that end, since the
onset of the pandemic through the third quarter of 2021, we have incurred over
$40 million in incremental COVID-19-related costs, primarily supplemental pay
for frontline employees. We continue to support our employees and their
families, with certain costs continuing in 2021, albeit to a lesser extent than
in the prior year, as employee COVID-19 cases and related impacts are similarly
abating. The impact of the COVID-19 pandemic on our business, results of
operations, financial condition and cash flows in future periods will depend
largely on future developments, including the duration and spread of the
outbreak in the U.S. and Canada, the rate of vaccinations, the severity of
COVID-19 variants, the actions to contain such coronavirus variants, and how
quickly and to what extent normal economic and operating conditions can resume.

CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS

The preparation of financial statements in conformity with U.S. generally
accepted accounting principles, or GAAP, requires estimates and assumptions that
affect the reported amounts of assets and liabilities, revenues and expenses and
related disclosures of contingent assets and liabilities in the condensed
consolidated financial statements. As described by the SEC, critical accounting
estimates and assumptions are those that may be material due to the levels of
subjectivity and judgment necessary to account for highly uncertain matters or
the susceptibility of such matters to change, and that have a material impact on
the financial condition or operating performance of a company. Such critical
accounting estimates and assumptions are applicable to our reportable segments.
Refer to our most recent Annual Report on Form 10-K for a complete description
of our critical accounting estimates and assumptions.

NEW ACCOUNTING PRONOUNCEMENTS

For a description of the new accounting standards that affect us, see Note 3 to
our Condensed Consolidated Financial Statements included in Part I, Item 1 of
this Quarterly Report on Form 10-Q.

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RESULTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

The following table sets forth items in our Condensed Consolidated Statements of
Net Income in thousands of U.S. dollars and as a percentage of revenues for the
periods indicated.




                          Three Months Ended September 30,                     Nine Months Ended September 30,
                             2021                     2020                       2021                    2020
Revenues            $ 1,597,168      100.0 %  $ 1,389,552    100.0 %     $ 4,527,042    100.0 %  $ 4,047,739    100.0 %
Cost of
operations              946,098       59.2        828,822     59.6         2,673,209     59.1      2,429,957     60.0
Selling, general
and
administrative          155,520        9.8        136,003      9.8           454,885     10.0        404,213     10.0
Depreciation            171,965       10.8        157,590     11.3           498,588     11.0        459,641     11.4
Amortization of
intangibles              35,337        2.2         32,653      2.4           100,237      2.2         96,062      2.4
Impairments and
other operating
items                     3,104        0.2          3,805      0.3             9,819      0.2        442,582     10.9
Operating income        285,144       17.8        230,679     16.6         

790,304 17.5 215,284 5.3

Interest expense (40,418) (2.5) (40,636) (2.9) (124,171) (2.7) (119,562) (2.9) Interest income

             495          -            903      0.1             2,342        -          4,396      0.1
Other income
(expense), net            3,140        0.2            702      0.0             5,452      0.1        (3,046)    (0.1)
Loss on early
extinguishment
of debt               (115,288)      (7.2)              -      0.0         (115,288)    (2.6)              -      0.0
Income tax
provision              (18,419)      (1.1)       (33,657)    (2.4)         (106,578)    (2.3)       (23,654)    (0.6)
Net income              114,654        7.2        157,991     11.4           452,061     10.0         73,418      1.8
Net loss
(income)
attributable to
noncontrolling
interests                 (273)      (0.0)             58      0.0             (325)      0.0            594      0.0
Net income
attributable to
Waste
Connections         $   114,381        7.2 %  $   158,049     11.4 %     $ 

 451,736     10.0 %  $    74,012      1.8 %




Revenues.  Total revenues increased $207.6 million, or 14.9%, to $1.597 billion

for the three months ended September 30, 2021, from $1.390 billion for the three
months ended September 30, 2020. Total revenues increased $479.3 million, or
11.8%, to $4.527 billion for the nine months ended September 30, 2021, from
$4.048 billion for the nine months ended September 30, 2020.

Acquisitions closed during or subsequent to the three months ended September 30,
2020 increased revenues by $54.1 million for the three months ended September
30, 2021. Acquisitions closed during or subsequent to the nine months ended
September 30, 2020 increased revenues by $145.4 million for the nine months
ended September 30, 2021.

Operations that were divested subsequent to September 30, 2020 decreased revenues by $2.8 million and $9.5 million, respectively, for the three and nine months ended September 30, 2021.

During the three months ended September 30, 2021, the net increase in prices
charged to our customers at our existing operations was $67.7 million,
consisting of $62.0 million of core price increases and surcharges of $5.7
million. During the nine months ended September 30, 2021, the net increase in
prices charged to our customers at our existing operations was $180.9 million,
consisting of $176.3 million of core price increases and surcharges of $4.6
million.

During the three and nine months ended September 30, 2021, volume increases in
our existing business increased solid waste revenues by $28.9 million and $68.6
million, respectively, as many of our markets benefitted from increased business
activity resulting from reductions in COVID-19-related restrictions.

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E&P revenues at facilities owned during the three months ended September 30,
2021 increased $11.3 million due to a recovery in the demand for crude oil
resulting in increased drilling and production and increased demand for our E&P
waste services. E&P revenues at facilities owned during the nine months ended
September 30, 2021 decreased $27.7 million attributable to the first and second
quarter results in 2021 being adversely impacted by decreases in the demand for
crude oil as a result of economic disruptions from the COVID-19 pandemic
resulting in a drop in the value of crude oil, decreases in drilling and
production activity levels and decreases in overall demand for our E&P waste
services, with our third quarter results in 2021 benefitting from recoveries in
the demand for crude oil and our E&P disposal services.

An increase in the average Canadian dollar to U.S. dollar currency exchange rate
resulted in an increase in revenues of $10.5 million and $41.3 million,
respectively, for the three and nine months ended September 30, 2021. The
average Canadian dollar to U.S. dollar exchange rates on our Canadian revenues
were 0.7936 and 0.7511 for the three months ended September 30, 2021 and 2020,
respectively. The average Canadian dollar to U.S. dollar exchange rates on our
Canadian revenues were 0.7996 and 0.7399 for the nine months ended September 30,
2021 and 2020, respectively.

Revenues from sales of recyclable commodities at facilities owned during the
three and nine months ended September 30, 2021 and 2020 increased $28.3 million
and $57.6 million, respectively, due primarily to higher prices for old
corrugated cardboard, aluminum and other paper products, higher volumes
collected from residential recycling customers and the partial recovery of
collected commercial recycling volumes which declined in the prior year period
due to economic disruptions resulting from the COVID-19 pandemic.

Other revenues increased $9.6 million during the three months ended September
30, 2021, due primarily to a $6.4 million increase resulting from higher prices
for renewable energy credits associated with the generation of landfill gas in
our Canada segment and a $3.2 million increase in other non-core revenue
sources. Other revenues increased $22.7 million during the nine months ended
September 30, 2021, due primarily to a $20.5 million increase resulting from
higher prices for renewable energy credits associated with the generation of
landfill gas at our Canada segment and a $5.9 million increase in other non-core
revenue sources, partially offset by a $3.7 million decrease in intermodal
revenues due primarily to customer losses and shipping port logistical
constraints resulting in a reduction in intermodal cargo volumes.

Cost of Operations.  Total cost of operations increased $117.3 million, or
14.1%, to $946.1 million for the three months ended September 30, 2021, from
$828.8 million for the three months ended September 30, 2020. The increase was
primarily the result of an increase in operating costs at our existing
operations of $85.0 million, assuming foreign currency parity, $28.8 million of
additional operating costs from acquisitions closed subsequent to the three
months ended September 30, 2020 and $5.5 million resulting from an increase in
the average foreign currency exchange rate in effect during the comparable
reporting periods, partially offset by a decrease in operating costs of $2.0
million at operations divested subsequent to the three months ended September
30, 2020.

The increase in operating costs of $85.0 million, assuming foreign currency
parity, at our existing operations for the three months ended September 30,
2021, consisted of an increase in labor expenses of $28.1 million due primarily
to employee pay increases and headcount additions to support solid waste volume
increases, an increase in truck, container, equipment and facility maintenance
and repair expenses of $12.5 million due to parts and service rate increases and
additional maintenance and repair requirements resulting from increased truck
and equipment operating hours to support increases in our solid waste volumes,
an increase in diesel fuel expense of $9.8 million due to higher fuel prices and
increased consumption resulting from additional truck and equipment operating
hours to support solid waste volume increases, an increase in third-party
trucking and transportation expenses of $9.4 million due primarily to increased
transfer station and landfill special waste volumes requiring trucking and
transportation services to our landfills, an increase in third-party disposal
expenses of $8.6 million due primarily to increased solid waste collection
volumes, an increase in taxes on revenues of $7.7 million due primarily to
increased revenues in our solid waste markets and a credit recorded to expenses
during the prior year period at Chiquita Canyon landfill due to a reversal of
amounts accrued for certain fees and exactions resulting from our successful
challenge of these expenses, an increase in 401(k) matching expenses of $4.6
million due to the prior year period reflecting less expenses due to the impact
of the June 1, 2020 to December 31, 2020 suspension of our 401(k) match, an
increase in subcontracted hauling services of $3.5 million due to outsourcing
the servicing of certain non-strategic contracts and commercial collection
customers to third party haulers, an increase in employee medical benefits
expenses of $2.5 million due to an increase in medical visits, an increase in
leachate expense of $2.4 million due primarily to the impact of hurricanes and
tropical storms causing higher precipitation in certain markets

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where our landfills are located, an increase in expenses for auto and workers'
compensation claims of $1.9 million due primarily to an increase in incidents
and adjustments recorded in the prior year period to decrease projected losses
on outstanding claims originally recorded prior to 2020, an increase in
insurance premium expenses of $1.3 million due primarily to increased insurance
premium costs for auto and environmental compliance and $3.6 million of other
net expense increases, partially offset by a decrease in supplemental bonuses
and other cash incentive compensation to non-management personnel of $7.0
million due to the prior year period including non-recurring expenses to
recognize services provided by our front-line employees during the COVID-19
pandemic and a decrease in expenses for processing recyclable commodities of
$3.9 million due to increased recyclable commodity values resulting in price
reductions charged by third-party recycling processors.

Total cost of operations increased $243.2 million, or 10.0%, to $2.673 billion
for the nine months ended September 30, 2021, from $2.430 billion for the nine
months ended September 30, 2020. The increase was primarily the result of an
increase in operating costs at our existing operations of $149.0 million,
assuming foreign currency parity, $77.5 million of additional operating costs
from acquisitions closed subsequent to the nine months ended September 30, 2020
and $22.8 million resulting from an increase in the average foreign currency
exchange rate in effect during the comparable reporting periods, partially
offset by a decrease in operating costs of $6.1 million at operations divested
subsequent to the nine months ended September 30, 2020.

The increase in operating costs of $149.0 million, assuming foreign currency
parity, at our existing operations for the nine months ended September 30, 2021,
consisted of an increase in labor expenses at our solid waste operations of
$54.4 million due primarily to employee pay increases and headcount additions to
support solid waste volume increases, an increase in truck, container, equipment
and facility maintenance and repair expenses of $23.2 million due primarily to
parts and service rate increases, an increase in third-party trucking and
transportation expenses of $21.6 million due primarily to increased transfer
station and landfill special waste volumes requiring trucking and transportation
services to our landfills, an increase in third-party disposal expenses of $20.8
million due primarily to increased solid waste collection volumes, an increase
in diesel fuel expense of $17.2 million due to higher fuel prices, an increase
in employee medical benefits expenses of $14.0 million due to an increase in
medical visits, an increase in taxes on revenues of $12.9 million due primarily
to increased revenues in our solid waste markets, an increase in subcontracted
hauling services at our solid waste operations of $10.0 million due to
outsourcing the servicing of certain non-strategic contracts and commercial
collection customers to third party haulers, an increase in 401(k) matching
expenses of $6.4 million due to the prior year period reflecting less expenses
due to the impact of the June 1, 2020 to December 31, 2020 suspension of our
401(k) match, an increase in landfill maintenance, environmental compliance and
daily cover expenses of $3.8 million due to increased compliance requirements
under our landfill operating permits, an increase in insurance premium expenses
of $3.3 million due primarily to increased insurance premium costs for auto and
environmental compliance, an increase in leachate expense of $1.7 million due
primarily to the impact of hurricanes and tropical storms causing higher
precipitation in certain markets where our landfills are located, an increase in
heavy equipment rental expenses of $1.4 million to provide support for solid
waste volume increases at our disposal operations, an increase in property tax
expenses of $1.3 million due primarily to reassessed property values at certain
locations and an increase in capital assets that are subject to property tax
assessments and $2.7 million of other net expense increases, partially offset by
a decrease in supplemental bonuses and other cash incentive compensation to
non-management personnel of $22.1 million due to the prior year period including
non-recurring expenses to recognize services provided by our front-line
employees during the COVID-19 pandemic, a decrease in expenses for auto and
workers' compensation claims of $6.2 million due primarily to higher claims
severity in the prior year period and adjustments recorded in the current year
period to decrease projected losses on outstanding claims originally recorded
prior to 2021, a decrease in expenses for processing recyclable commodities of
$6.1 million due to increased recyclable commodity values resulting in price
reductions charged by third-party recycling processors, a decrease in labor at
our E&P operations of $4.3 million due to headcount reductions resulting from
E&P disposal volume decreases, a decrease in subcontracted operating and
remediation services at our E&P operations of $3.9 million due to E&P disposal
volume decreases and a decrease in intermodal rail expenses of $3.1 million due
to a reduction in cargo volume.

Cost of operations as a percentage of revenues decreased 0.4 percentage points
to 59.2% for the three months ended September 30, 2021, from 59.6% for the three
months ended September 30, 2020. The decrease as a percentage of revenues
consisted of a 0.6 percentage point decrease from a reduction in supplemental
bonuses and other cash incentive compensation to non-management personnel, a 0.2
percentage point decrease from a reduction in expenses for processing

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recyclable commodities and a 0.2 percentage point decrease from all other net
changes, partially offset by a 0.3 percentage point increase from higher 401(k)
matching expenses and a 0.3 percentage point increase from higher diesel fuel
expenses.

Cost of operations as a percentage of revenues decreased 0.9 percentage points
to 59.1% for the nine months ended September 30, 2021, from 60.0% for the nine
months ended September 30, 2020. The decrease as a percentage of revenues
consisted of a 0.6 percentage point decrease from a decrease in supplemental
bonuses and other cash incentive compensation to non-management personnel, a 0.2
percentage point decrease from a reduction in expenses for auto and workers'
compensation claims, a 0.2 percentage point decrease from leveraging existing
personnel to support our solid waste revenue volume growth and a 0.1 percentage
point decrease from all other net changes, partially offset by a 0.2 percentage
point increase from higher employee medical expenses.

SG&A.  SG&A expenses increased $19.5 million, or 14.4%, to $155.5 million for
the three months ended September 30, 2021, from $136.0 million for the three
months ended September 30, 2020. The increase was comprised of an increase of
$15.9 million in SG&A expenses at our existing operations, assuming foreign
currency parity, $2.9 million of additional SG&A expenses from operating
locations at acquisitions closed subsequent to the three months ended September
30, 2020 and $0.9 million resulting from an increase in the average foreign
currency exchange rate in effect during the comparable reporting periods,
partially offset by a decrease in SG&A expenses of $0.2 million at operations
divested subsequent to the three months ended September 30, 2020.

The increase in SG&A expenses at our existing operations of $15.9 million,
assuming foreign currency parity, for the three months ended September 30, 2021,
was comprised of a collective increase in travel, meeting, training and
community activity expenses of $4.3 million attributable to increased travel and
social gatherings in the current year period due to a reduction in restrictions
associated with the COVID-19 pandemic, an increase in direct acquisition
expenses of $3.3 million due to an increase in acquisition activity in the
comparable periods, an increase in administrative payroll expenses of $2.9
million due primarily to annual pay and headcount increases, an increase in
accrued recurring cash incentive compensation expense to our management of $1.8
million, an increase in 401(k) matching expenses of $1.8 million due to the
prior year period reflecting less expenses due to the impact of the June 1, 2020
to December 31, 2020 suspension of our 401(k) match, an increase in expenses for
uncollectible accounts receivable of $1.4 million primarily due to non-recurring
expense reductions recorded in the prior year period to adjust reserves for
uncollectible accounts receivable based upon actual payment defaults from
customers experiencing financial difficulties resulting from the economic impact
of the COVID-19 pandemic being less than originally estimated, an increase in
employee relocation expenses of $0.8 million and $1.9 million of other net
expense increases, partially offset by a decrease in equity-based compensation
expenses of $1.2 million resulting primarily from expense increases recorded
during the prior year period to the amount of performance-based restricted share
units granted in 2018 that were estimated to ultimately vest based on the
achievement of required financial performance results and a decrease in deferred
compensation expenses of $1.1 million as a result of higher increases during the
prior year period in the market value of investments to which employee deferred
compensation liability balances are tracked.

SG&A expenses increased $50.7 million, or 12.5%, to $454.9 million for the nine
months ended September 30, 2021, from $404.2 million for the nine months ended
September 30, 2020. The increase was comprised of an increase of $38.3 million
in SG&A expenses at our existing operations, assuming foreign currency parity,
$8.9 million of additional SG&A expenses from operating locations at
acquisitions closed subsequent to the nine months ended September 30, 2020 and
$4.1 million resulting from an increase in the average foreign currency exchange
rate in effect during the comparable reporting periods, partially offset by a
decrease in SG&A expenses of $0.6 million at operations divested subsequent to
the nine months ended September 30, 2020.

The increase in SG&A expenses at our existing operations of $38.3 million,
assuming foreign currency parity, for the nine months ended September 30, 2021,
was comprised of an increase in accrued recurring cash incentive compensation
expense to our management of $16.2 million, a collective increase in travel,
meeting, training and community activity expenses of $5.0 million due to
increased travel and social gatherings in the current year period due to a
reduction in restrictions associated with the COVID-19 pandemic, an increase in
employee medical benefits expenses of $4.1 million due to an increase in medical
visits, an increase in administrative payroll expenses of $4.0 million due
primarily to annual pay and headcount increases, an increase in deferred
compensation expenses of $3.1 million as a result of increases in the market
value of investments to which employee deferred compensation liability balances
are tracked, an increase in 401(k)

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matching expenses of $2.4 million due to the prior year period reflecting less
expenses due to the impact of the June 1, 2020 to December 31, 2020 suspension
of our 401(k) match, an increase in professional fees of $2.3 million due
primarily to adjustments recorded during the prior year period to reduce
estimated accrued liabilities associated with unbilled legal services and
increased expenses associated with professional tax services, an increase in
advertising expenses of $1.7 million due primarily to cost reduction efforts
associated with the COVID-19 pandemic reducing the prior year period expenses,
an increase in direct acquisition expenses of $1.7 million due to an increase in
acquisition activity in the comparable periods, an increase in employee
relocation expenses of $1.6 million and an increase in equity-based compensation
expenses of $1.2 million associated with the net impact of current and prior
period adjustments of our common shares held in our deferred compensation plan
by certain key executives to fair value as a result of the shares being
exchanged for other investment options, partially offset by a decrease in
expenses for uncollectible accounts receivable of $4.9 million primarily due to
the prior year period incurring increased expenses due to customers experiencing
financial difficulties resulting from the economic impact of the COVID-19
pandemic and $0.1 million of other net expense decreases.

SG&A as a percentage of revenues was unchanged at 9.8% for the three months ended September 30, 2020 and 2021 and 10.0% for the nine months ended September 30, 2020 and 2021.

Depreciation.  Depreciation expense increased $14.4 million, or 9.1%, to $172.0
million for the three months ended September 30, 2021, from $157.6 million for
the three months ended September 30, 2020. The increase was comprised of an
increase in depreciation expense of $5.8 million from the impact of additions to
our fleet and equipment purchased to support our existing operations, an
increase in depletion expense of $4.8 million resulting from increased landfill
municipal solid waste and special waste volumes, depreciation expense of $3.3
million from acquisitions closed subsequent to the three months ended September
30, 2020 and $1.2 million resulting from an increase in the average foreign
currency exchange rate in effect during the comparable reporting periods,
partially offset by a decrease in depreciation and depletion expense of $0.7
million from operations divested subsequent to the three months ended September
30, 2020.

Depreciation expense increased $39.0 million, or 8.5%, to $498.6 million for the
nine months ended September 30, 2021, from $459.6 million for the nine months
ended September 30, 2020. The increase was comprised of an increase in
depreciation expense of $15.7 million from the impact of additions to our fleet
and equipment purchased to support our existing operations, depreciation and
depletion expense of $11.1 million from acquisitions closed subsequent to the
nine months ended September 30, 2020, an increase in depletion expense of $9.8
million resulting from increased landfill municipal solid waste and special
waste volumes and $4.8 million resulting from an increase in the average foreign
currency exchange rate in effect during the comparable reporting periods,
partially offset by a decrease in depreciation and depletion expense of $2.4
million from operations divested subsequent to the nine months ended September
30, 2020.

Depreciation expense as a percentage of revenues decreased 0.5 percentage points
to 10.8% for the three months ended September 30, 2021, from 11.3% for the three
months ended September 30, 2020. Depreciation expense as a percentage of
revenues decreased 0.4 percentage points to 11.0% for the nine months ended
September 30, 2021, from 11.4% for the nine months ended September 30, 2020. The
decreases as a percentage of revenues were primarily attributable to leveraging
volume increases in our solid waste revenues.

Amortization of Intangibles.  Amortization of intangibles expense increased $2.6
million, or 8.2%, to $35.3 million for the three months ended September 30,
2021, from $32.7 million for the three months ended September 30, 2020. The
increase was the result of $3.2 million from intangible assets acquired in
acquisitions closed subsequent to the three months ended September 30, 2020 and
$0.3 million from an increase in the average foreign currency exchange rate in
effect during the comparable reporting periods, partially offset by a decrease
of $0.8 million from certain intangible assets becoming fully amortized
subsequent to September 30, 2020 and a decrease of $0.1 million from operations
divested subsequent to the three months ended September 30, 2020.

Amortization of intangibles expense increased $4.1 million, or 4.3%, to $100.2
million for the nine months ended September 30, 2021, from $96.1 million for the
nine months ended September 30, 2020. The increase was the result of $8.5
million from intangible assets acquired in acquisitions closed subsequent to the
nine months ended September 30, 2020 and $1.3 million from an increase in the
average foreign currency exchange rate in effect during the comparable reporting
periods, partially offset by a decrease of $5.4 million from certain intangible
assets becoming fully amortized

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subsequent to September 30, 2020 and a decrease of $0.3 million from operations divested subsequent to the nine months ended September 30, 2020.

Amortization expense as a percentage of revenues decreased 0.2 percentage points
to 2.2% for the three and nine months ended September 30, 2021, from 2.4% for
the three and nine months ended September 30, 2020. The decreases as a
percentage of revenues were primarily attributable to leveraging volume
increases in our solid waste revenues.

Impairments and Other Operating Items.  Impairments and other operating items
decreased $0.7 million, to net losses totaling $3.1 million for the three months
ended September 30, 2021, from net losses totaling $3.8 million for the three
months ended September 30, 2020.

The net losses of $3.1 million recorded during the three months ended September
30, 2021 consisted of $2.0 million of charges to terminate or write off the
carrying cost of certain contracts that were not, or are not expected to be,
renewed prior to their original estimated termination date and $1.1 million of
losses on property and equipment that were disposed of through sales or as a
result of being damaged in operations.

The net losses of $3.8 million recorded during the three months ended September
30, 2020 consisted of $1.9 million of losses on property and equipment that were
disposed of through sales or as a result of being damaged in operations, $1.8
million of charges to terminate or write off the carrying cost of certain
contracts that were not, or are not expected to be, renewed prior to their
original estimated termination date and $0.1 million of other net charges to
expense.

Impairments and other operating items decreased $432.8 million, to net losses
totaling $9.8 million for the nine months ended September 30, 2021, from net
losses totaling $442.6 million for the nine months ended September 30, 2020.

The net losses of $9.8 million recorded during the nine months ended September
30, 2021 consisted of a $4.6 million loss resulting from property and equipment
damaged in a facility fire, $3.2 million of charges to terminate or write off
the carrying cost of certain contracts that were not, or are not expected to be,
renewed prior to their original estimated termination date, $1.5 million of
losses on property and equipment that were disposed of through sales or as a
result of being damaged in operations and $0.5 million of other net charges.

During the nine months ended September 30, 2020, we concluded that a triggering
event occurred which required us to perform an impairment test of the property
and equipment and intangible assets of our E&P operations as of June 30, 2020.
As a result of the impairment test, we concluded that the carrying value of four
E&P landfills exceeded their estimated fair value, resulting in an impairment
charge of $417.4 million to property and equipment. The remaining net losses of
$25.2 million recorded during the nine months ended September 30, 2020 consisted
of $16.8 million to adjust the carrying value of contingent consideration
liabilities, $4.3 million of charges to terminate or write off the carrying cost
of certain contracts that were not, or are not expected to be, renewed prior to
their original estimated termination date, $3.4 million of losses on property
and equipment that were disposed of through sales or as a result of being
damaged in operations and $0.7 million of other net charges.

Operating Income.  Operating income increased $54.4 million, or 23.6%, to $285.1
million for the three months ended September 30, 2021, from $230.7 million for
the three months ended September 30, 2020. Operating income increased $575.0
million, or 267.1%, to $790.3 million for the nine months ended September 30,
2021, from $215.3 million for the nine months ended September 30, 2020.

Our operating results for the nine months ended September 30, 2020 were
adversely impacted by the aforementioned impairment charge at our E&P operations
of $417.4 million. The remaining increase in our operating income for the three
and nine months ended September 30, 2021 was due primarily to price increases
for our solid waste services, increases in solid waste collection and disposal
volumes, operating income contributions from increased sales of recyclable
commodities and renewable energy credits associated with the generation of
landfill gas, operating income generated from acquisitions closed subsequent to
the three and nine months ended September 30, 2020 and an increase in the
average Canadian dollar to U.S. dollar currency exchange rate.

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Operating income as a percentage of revenues increased 1.2 percentage points to
17.8% for the three months ended September 30, 2021, from 16.6% for the three
months ended September 30, 2020.  The increase as a percentage of revenues was
comprised of a 0.5 percentage point decrease in depreciation expense, a 0.4
percentage point decrease in cost of operations, a 0.2 percentage point decrease
in amortization expense and a 0.1 percentage point decrease in impairments and
other operating items.

Operating income as a percentage of revenues increased 12.2 percentage points to
17.5% for the nine months ended September 30, 2021, from 5.3% for the nine
months ended September 30, 2020.  The increase as a percentage of revenues was
comprised of a 10.7 percentage point decrease in impairments and other operating
items, a 0.9 percentage point decrease in cost of operations, a 0.4 percentage
point decrease in depreciation expense and a 0.2 percentage point decrease in
amortization expense.

Interest Expense.  Interest expense decreased $0.2 million, or 0.5%, to $40.4
million for the three months ended September 30, 2021, from $40.6 million for
the three months ended September 30, 2020. The decrease was primarily
attributable to a decrease of $3.4 million from the repayment of $1.75 billion
of senior unsecured notes in 2021 and $0.7 million of other net decreases,
partially offset by an increase of $1.5 million from higher net interest rates
on borrowings outstanding under our Credit Agreement due primarily to $600
million in interest rate swap agreements commencing in October 2020 at higher
interest rates than $575 million in interest rate swap agreements which expired
between September 2020 and October 2020, an increase of  $1.2 million due to an
increase in the average borrowings outstanding under our Credit Agreement and an
increase of $1.2 million from the September 2021 issuance of our 2032 Senior
Notes (as defined below) and our 2052 Senior Notes (as defined below).

Interest expense increased $4.6 million, or 3.9%, to $124.2 million for the nine
months ended September 30, 2021, from $119.6 million for the nine months ended
September 30, 2020. The increase was primarily attributable to an increase of
$5.0 million from higher net interest rates on borrowings outstanding under our
Credit Agreement due primarily to $600 million in interest rate swap agreements
commencing in October 2020 at higher interest rates than $575 million in
interest rate swap agreements which expired between September 2020 and October
2020, an increase of $3.1 million from the March 2020 issuance of our 2050
Senior Notes (as defined below), an increase of $1.2 million from the September
2021 issuance of our 2032 Senior Notes (as defined below) and our 2052 Senior
Notes (as defined below), an increase of $0.9 million from the January 2020
issuance of our 2030 Senior Notes (as defined below) and $0.2 million of other
net increases, partially offset by a decrease of $4.8 million from the repayment
of $1.75 billion of senior unsecured notes in 2021 and a decrease of $1.0
million due to a reduction in the average borrowings outstanding under our
Credit Agreement.

Interest Income.  Interest income decreased $0.4 million to $0.5 million for the
three months ended September 30, 2021, from $0.9 million for the three months
ended September 30, 2020. Interest income decreased $2.1 million to $2.3 million
for the nine months ended September 30, 2021, from $4.4 million for the nine
months ended September 30, 2020. The decreases were primarily attributable to
lower reinvestment rates in the current period.

Other Income (Expense), Net. Other income (expense), net increased $2.4 million, to an income total of $3.1 million for the three months ended September 30, 2021, from an income total of $0.7 million for the three months ended September 30, 2020.

Other income of $3.1 million recorded during the three months ended September
30, 2021 consisted of $2.0 million of adjustments to certain current assets
acquired in prior period acquisitions and a $1.1 million increase in other net
income.

Other income of $0.7 million recorded during the three months ended September
30, 2020 consisted of $1.5 million of earnings on investments purchased to fund
our employee deferred compensation obligations, partially offset by a $0.8
million decrease from other net expenses.

Other income (expense), net increased $8.5 million, to an income total of $5.5
million for the nine months ended September 30, 2021, from an expense total of
$3.0 million for the nine months ended September 30, 2020.

Other income of $5.5 million recorded during the nine months ended September 30,
2021 consisted of $2.0 million of income earned on investments purchased to fund
our employee deferred compensation obligations, an increase in

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foreign currency transaction gains of $0.9 million attributable to the impact of
an increase in the Canadian dollar to U.S. dollar exchange rate during the
period, $0.6 million of net adjustments to certain current assets and
liabilities acquired in prior period acquisitions and a $2.0 million increase in
other net income sources.

Other expense of $3.0 million recorded during the nine months ended September
30, 2020 consisted of a $3.0 million adjustment to increase certain accrued
liabilities acquired in the 2016 Progressive Waste acquisition and an increase
in foreign currency transaction losses of $1.5 million attributable to the
impact of a decrease in the Canadian dollar to U.S. dollar exchange rate during
the period,  partially offset by a $1.0 million adjustment to decrease certain
non-acquisition accrued liabilities recorded in prior periods and a $0.5 million
increase in other expenses.

Loss on Early Extinguishment of Debt.  Loss on early extinguishment of debt was
$115.3 million for the three and nine months ended September 30, 2021 and
consists of the payment of a make-whole premium and the write-off of remaining
unamortized loan fees associated with the early repayment of the outstanding
senior notes under our master note purchase agreements.

Income Tax Provision.  Income taxes decreased $15.3 million, to $18.4 million
for the three months ended September 30, 2021, from $33.7 million for the three
months ended September 30, 2020.  Our effective tax rate for the three months
ended September 30, 2021 was 13.8%. Our effective tax rate for the three months
ended September 30, 2020 was 17.6%.  Income taxes increased $82.9 million, to
$106.6 million for the nine months ended September 30, 2021, from $23.7 million
for the nine months ended September 30, 2020.  Our effective tax rate for the
nine months ended September 30, 2021 was 19.1%. Our effective tax rate for the
nine months ended September 30, 2020 was 24.4%.

The income tax provision for the nine months ended September 30, 2021 included
benefits of $2.0 million from share-based payment awards being recognized in the
income statement when settled, as well as a portion of our internal financing
being taxed at effective rates substantially lower than the U.S. federal
statutory rate.

The income tax provision for the nine months ended September 30, 2020 included a
$27.4 million expense associated with certain 2019 related-party payments no
longer being deductible for tax purposes due to the finalization of tax
regulations on April 7, 2020 under Internal Revenue Code section 267A and a $4.1
million expense related to an increase in our deferred income tax liabilities
resulting from the impairment of certain assets within our E&P operations, which
impacted the geographical apportionment of our state income taxes.
Additionally, the income tax benefit for the nine months ended September 30,
2020 included a benefit of $5.3 million from share-based payment awards being
recognized in the income statement when settled, as well as a portion of our
internal financing being taxed at effective rates substantially lower than

the
U.S. federal statutory rate.

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SEGMENT RESULTS

General

No single contract or customer accounted for more than 10% of our total revenues
at the consolidated or reportable segment level during the periods presented.
The following table disaggregates our revenue by service line for the periods
indicated (dollars in thousands of U.S. dollars).




                                             Three Months Ended September 30,            Nine Months Ended September 30,
                                                2021                  2020                 2021                  2020
Commercial                                $         465,246     $         406,037    $      1,335,686      $       1,197,971
Residential                                         422,543               387,566           1,240,337              1,131,486
Industrial and construction roll off                249,417               216,894             695,975                618,122
Total collection                                  1,137,206             1,010,497           3,271,998              2,947,579
Landfill                                            328,147               308,795             927,207                855,631
Transfer                                            225,827               205,910             632,282                575,761
Recycling                                            55,772                21,377             129,759                 59,701
E&P                                                  38,519                26,218             101,137                131,748
Intermodal and other                                 38,377                27,141             112,602                 84,970
Intercompany                                      (226,680)             (210,386)           (647,943)              (607,651)
Total                                     $       1,597,168     $       1,389,552    $      4,527,042      $       4,047,739




Our Chief Operating Decision Maker evaluates operating segment profitability and
determines resource allocations based on several factors, of which the primary
financial measure is segment EBITDA. We define segment EBITDA as earnings before
interest, taxes, depreciation, amortization, impairments and other operating
items and other income (expense). Segment EBITDA is not a measure of operating
income, operating performance or liquidity under GAAP and may not be comparable
to similarly titled measures reported by other companies. Our management uses
segment EBITDA in the evaluation of segment operating performance as it is a
profit measure that is generally within the control of the operating segments.

The Company manages its operations through five geographic operating segments,
which are also its reportable segments. Each operating segment is responsible
for managing several vertically integrated operations, which are comprised of
districts.

At September 30, 2021, our Southern segment services customers located in
Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, New Mexico, North
Dakota, southern Oklahoma, western Tennessee, Texas, Wyoming and along the Gulf
of Mexico; our Eastern segment services customers located in Delaware, northern
Illinois, Kentucky, Maryland, Massachusetts, New Hampshire, New Jersey, New
York, North Carolina, Pennsylvania, Rhode Island, South Carolina, eastern
Tennessee, Vermont, Virginia and Wisconsin; our Western segment services
customers located in Alaska, California, Idaho, Montana, Nevada, Oregon,
Washington and western Wyoming; our Central segment services customers located
in Arizona, Colorado, southern Illinois, Iowa, Kansas, Minnesota, Missouri,
Nebraska, New Mexico, Oklahoma, South Dakota, western Texas, Utah and eastern
Wyoming; and our Canada segment services customers located in the state of
Michigan and in the provinces of Alberta, British Columbia, Manitoba, Ontario,
Québec and Saskatchewan.

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Revenues, net of intercompany eliminations, for our reportable segments are shown in the following table in thousands of U.S. dollars and as a percentage of total revenues for the periods indicated.

                  Three Months Ended September 30,                    Nine 

Months Ended September 30,

                    2021                     2020                       2021                    2020
Eastern     $   396,229      24.8 %  $   344,353     24.8 %     $ 1,102,307     24.4 %  $   995,446     24.6 %
Southern        370,958      23.2        330,575     23.8         1,072,456     23.7      1,033,297     25.5
Western         332,020      20.8        301,221     21.7           942,813     20.8        848,739     21.0
Central         273,682      17.1        228,566     16.4           775,913     17.1        653,728     16.1
Canada          224,279      14.1        184,837     13.3           633,553     14.0        516,529     12.8
            $ 1,597,168     100.0 %  $ 1,389,552    100.0 %     $ 4,527,042    100.0 %  $ 4,047,739    100.0 %

Segment EBITDA for our reportable segments is shown in the following table in thousands of U.S. dollars and as a percentage of segment revenues for the periods indicated.

                         Three Months Ended September 30,                 

Nine Months Ended September 30,

                             2021                  2020                     2021                   2020
Western                  108,280     32.6 %    101,071    33.6 %     $   301,507    32.0 %  $   267,523    31.5 %
Eastern                  106,908     27.0 %     90,991    26.4 %         295,411    26.8 %      258,333    26.0 %
Southern                  99,612     26.9 %     81,394    24.6 %         291,964    27.2 %      276,844    26.8 %
Central                   95,026     34.7 %     82,887    36.3 %         268,952    34.7 %      235,742    36.1 %
Canada                    92,275     41.1 %     72,516    39.2 %         254,857    40.2 %      185,589    35.9 %
Corporate(a)             (6,551)        -      (4,132)       -          (13,743)       -       (10,462)       -
                     $   495,550     31.0 %  $ 424,727    30.6 %     $ 1,398,948    30.9 %  $ 1,213,569    30.0 %

The majority of Corporate expenses are allocated to the five operating

segments. Direct acquisition expenses, expenses associated with common

shares held in the deferred compensation plan exchanged for other investment (a) options and share-based compensation expenses associated with Progressive

Waste share-based grants outstanding at June 1, 2016 that were continued by

the Company are not allocated to the five operating segments and comprise the

net EBITDA for our Corporate segment for the periods presented.

A reconciliation of segment EBITDA to Income before income tax provision is included in Note 11 to our Condensed Consolidated Financial Statements included in Part 1, Item 1 of this report.

Significant changes in revenue and segment EBITDA for our reportable segments
for the three and nine month periods ended September 30, 2021, compared to the
three and nine month periods ended September 30, 2020, are discussed below.

Segment Revenue

Revenue in our Eastern segment increased $51.8 million, or 15.1%, to $396.2
million for the three months ended September 30, 2021, from $344.4 million for
the three months ended September 30, 2020. The components of the increase
consisted of revenue growth from acquisitions closed subsequent to the three
months ended September 30, 2020 of $22.3 million, net price increases of $16.5
million and the impact of a partial recovery of collected commercial recycling
volumes, which declined in the prior year period due to economic disruptions
resulting from the COVID-19 pandemic, and higher prices for old corrugated
cardboard, other paper products, plastics and aluminum contributing to a $13.4
million increase in sales from recyclable commodities, partially offset by other
revenue decreases of $0.4 million.

Revenue in our Eastern segment increased $106.9 million, or 10.7%, to $1.102
billion for the nine months ended September 30, 2021, from $995.4 million for
the nine months ended September 30, 2020. The components of the increase
consisted of net price increases of $43.8 million, revenue growth from
acquisitions closed subsequent to the nine months ended September 30, 2020 of
$42.3 million, the impact of a partial recovery of collected commercial
recycling volumes, which declined in the prior year period due to economic
disruptions resulting from the COVID-19 pandemic, and higher prices for old
corrugated cardboard, other paper products, plastics and aluminum contributing
to a $28.2 million increase in sales from recyclable commodities and other
revenue increases of $0.7 million, partially offset by solid waste volume
decreases of $8.1 million attributable primarily to COVID-19-related economic
disruptions in our Northeastern markets,

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which commenced in March 2020 and continued into 2021, driving declines in commercial collection and roll off collection volumes.

Revenue in our Southern segment increased $40.4 million, or 12.2%, to $371.0
million for the three months ended September 30, 2021, from $330.6 million for
the three months ended September 30, 2020. The components of the increase
consisted of net price increases of $22.3 million, an increase in revenue at our
E&P operations of $9.7 million due to a recovery in the demand for crude oil
resulting in increased drilling and production and increased demand for our E&P
waste services and solid waste volume increases of $6.4 million due primarily to
higher commercial collection, roll off collection, transfer station and landfill
volumes, higher prices for old corrugated cardboard, plastics and aluminum
products contributing to a $1.4 million increase in sales from recyclable
commodities, revenue growth from acquisitions closed subsequent to the three
months ended September 30, 2020 of $1.0 million and other revenue increases of
$0.9 million, partially offset by net revenue reductions from divestitures
closed subsequent to September 30, 2020 of $1.3 million.

Revenue in our Southern segment increased $39.2 million, or 3.8%, to $1.072
billion for the nine months ended September 30, 2021, from $1.033 billion for
the nine months ended September 30, 2020. The components of the increase
consisted of net price increases of $53.7 million, solid waste volume increases
of $10.8 million due primarily to higher commercial collection, roll off
collection, transfer station and landfill volumes, higher prices for old
corrugated cardboard, plastics and aluminum products contributing to a $5.8
million increase in sales from recyclable commodities, $1.7 million resulting
from higher prices from the sale of landfill gas, revenue growth from
acquisitions closed subsequent to the nine months ended September 30, 2020 of
$1.4 million and other revenue increases of $0.8 million, partially offset by a
decline in revenue at our E&P operations of $29.7 million and net revenue
reductions from divestitures closed subsequent to September 30, 2020 of $5.3
million. The decrease in revenue at our E&P operations was attributable to the
first and second quarter results in 2021 being adversely impacted by decreases
in the demand for crude oil as a result of economic disruptions from the
COVID-19 pandemic resulting in a drop in the value of crude oil, decreases in
drilling and production activity levels and decreases in overall demand for our
E&P waste services, with our third quarter results in 2021 benefitting from
recoveries in the demand for crude oil and our E&P disposal services.

Revenue in our Western segment increased $30.8 million, or 10.2%, to
$332.0 million for the three months ended September 30, 2021, from $301.2
million for the three months ended September 30, 2020. The components of the
increase consisted of solid waste volume increases of $14.8 million attributable
to increased collection and disposal volumes, net price increases of $7.3
million, revenue growth from acquisitions closed subsequent to the three months
ended September 30, 2020 of $4.6 million and recyclable commodity revenue
increases of $4.4 million due primarily to higher prices for old corrugated
cardboard, metals and aluminum and higher volumes collected from residential
recycling customers, partially offset by intermodal revenue decreases of $0.3
million.

Revenue in our Western segment increased $94.1 million, or 11.1%, to
$942.8 million for the nine months ended September 30, 2021, from $848.7 million
for the nine months ended September 30, 2020. The components of the increase
consisted of solid waste volume increases of $47.3 million attributable to
increased collection and disposal volumes, net price increases of $21.2 million,
revenue growth from acquisitions closed subsequent to the nine months ended
September 30, 2020 of $20.0 million, recyclable commodity revenue increases of
$9.1 million due primarily to higher prices for old corrugated cardboard, metals
and aluminum and higher volumes collected from residential recycling customers
and other revenue increases of $0.2 million, partially offset by intermodal
revenue decreases of $3.7 million due primarily to customer losses and shipping
port logistical constraints resulting in a reduction in intermodal cargo
volumes.

Revenue in our Central segment increased $45.1 million, or 19.7%, to $273.7
million for the three months ended September 30, 2021, from $228.6 million for
the three months ended September 30, 2020. The components of the increase
consisted of revenue growth from acquisitions closed subsequent to the three
months ended September 30, 2020 of $26.1 million, net price increases of $11.0
million, higher prices for old corrugated cardboard and aluminum products
contributing to a $3.2 million increase in sales from recyclable commodities,
solid waste volume increases of $3.7 million due primarily to higher commercial
and roll off collection volumes, an increase in E&P revenue of $1.6 million and
other revenue increases of $1.0 million, partially offset by net revenue
reductions from divestitures closed subsequent to September 30, 2020 of $1.5
million.

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Revenue in our Central segment increased $122.2 million, or 18.7%, to $775.9
million for the nine months ended September 30, 2021, from $653.7 million for
the nine months ended September 30, 2020. The components of the increase
consisted of revenue growth from acquisitions closed subsequent to the nine
months ended September 30, 2020 of $81.5 million, net price increases of $30.4
million, solid waste volume increases of $5.9 million due primarily to
commercial and roll off collection volumes and higher landfill special waste
volumes, higher prices for old corrugated cardboard and aluminum products
contributing to a $4.7 million increase in sales from recyclable commodities, an
increase in E&P revenue of $1.9 million and other revenue increases of $2.0
million, partially offset by net revenue reductions from divestitures closed
subsequent to September 30, 2020 of $4.2 million.

Revenue in our Canada segment increased $39.5 million, or 21.3%, to $224.3
million for the three months ended September 30, 2021, from $184.8 million for
the three months ended September 30, 2020. The components of the increase
consisted of net price increases of $10.7 million, $10.5 million resulting from
a higher average foreign currency exchange rate in effect during the comparable
reporting periods, $6.4 million resulting from higher prices for renewable
energy credits associated with the generation of landfill gas, recyclable
commodity revenue increases of $5.9 million due primarily to higher prices for
old corrugated cardboard and higher volumes collected from residential recycling
customers, solid waste volume increases of $4.5 million due primarily to higher
collection and disposal volumes and other revenue increases of $1.5 million.

Revenue in our Canada segment increased $117.1 million, or 22.7%, to $633.6
million for the nine months ended September 30, 2021, from $516.5 million for
the nine months ended September 30, 2020. The components of the increase
consisted of $41.3 million resulting from a higher average foreign currency
exchange rate in effect during the comparable reporting periods, net price
increases of $31.8 million, $20.5 million resulting from higher prices for
renewable energy credits associated with the generation of landfill gas, solid
waste volume increases of $12.7 million due primarily to higher roll off
collection and landfill special waste volumes, recyclable commodity revenue
increases of $9.9 million due primarily to higher prices for old corrugated
cardboard and higher volumes collected from residential recycling customers and
other revenue increases of $0.9 million.

Segment EBITDA

Segment EBITDA in our Western segment increased $7.2 million, or 7.1%, to $108.3
million for the three months ended September 30, 2021, from $101.1 million for
the three months ended September 30, 2020. The increase was due primarily to an
increase in revenues of $30.8 million and a decrease in expenses for processing
recyclable commodities of $2.5 million due to increased recyclable commodity
values resulting in price reductions charged by third-party recycling
processors, partially offset by an increase in labor expenses of $6.4 million
due primarily to employee pay increases and headcount additions to support solid
waste volume increases, an increase in taxes on revenues of $4.1 million due
primarily to increased revenues in our solid waste markets and credit recorded
to expenses during the prior year period at Chiquita Canyon landfill due to a
reversal of amounts accrued for certain fees and exactions resulting from our
successful challenge of these expenses, an increase in third-party trucking and
transportation expenses of $3.3 million due primarily to increased transfer
station and landfill special waste volumes requiring trucking and transportation
services to our landfills, $2.8 million of additional operating costs from
acquisitions closed subsequent to the three months ended September 30, 2020, an
increase in diesel fuel expense of $2.7 million due to higher fuel prices and
increased consumption resulting from additional truck and equipment operating
hours to support solid waste volume increases, an increase in truck, container,
equipment and facility maintenance and repair expenses of $1.8 million due to
parts and service rate increases and additional maintenance and repair
requirements resulting from increased truck and equipment operating hours to
support increases in our solid waste volumes, an increase in 401(k) matching
expenses of $1.3 million due to the prior year period reflecting less expenses
due to the impact of the June 1, 2020 to December 31, 2020 suspension of our
401(k) match, an increase in employee medical benefits expenses of $1.2 million
due to an increase in medical visits, an increase in third-party disposal
expenses of $1.1 million due primarily to increased solid waste collection
volumes and $1.4 million of other net expense increases.

Segment EBITDA in our Western segment increased $34.0 million, or 12.7%, to
$301.5 million for the nine months ended September 30, 2021, from $267.5 million
for the nine months ended September 30, 2020. The increase was due primarily to
an increase in revenues of $94.1 million, a decrease in expenses for processing
recyclable commodities of $4.2 million due to increased recyclable commodity
values resulting in price reductions charged by third-party recycling

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processors, a decrease in intermodal rail expenses of $3.2 million due to a
reduction in cargo volume and a decrease in supplemental bonuses and other cash
incentive compensation to non-management personnel of $2.4 million due to the
prior year period including non-recurring expenses to recognize services
provided by our front-line employees during the COVID-19 pandemic, partially
offset by an increase in labor expenses of $15.3 million due primarily to
employee pay increases and headcount additions to support solid waste volume
increases, $13.9 million of additional operating costs from acquisitions closed
subsequent to the nine months ended September 30, 2020, an increase in
third-party trucking and transportation expenses of $6.6 million due primarily
to increased transfer station and landfill special waste volumes requiring
trucking and transportation services to our landfills, an increase in taxes on
revenues of $5.4 million due primarily to increased revenues in our solid waste
markets, an increase in diesel fuel expense of $5.1 million due to higher fuel
prices, an increase in third-party disposal expenses of $5.0 million due
primarily to increased solid waste collection volumes, an increase in employee
medical benefits expenses of $4.2 million due to an increase in medical visits,
an increase in truck, container, equipment and facility maintenance and repair
expenses of $4.0 million due primarily to parts and service rate increases, an
increase in corporate overhead expense allocations of $3.0 million due to an
increase in the overhead allocation rate resulting from an increase in corporate
expenses qualifying for allocation, an increase in 401(k) matching expenses of
$1.7 million due to the prior year period reflecting less expenses due to the
impact of the June 1, 2020 to December 31, 2020 suspension of our 401(k) match,
an increase in landfill maintenance, environmental compliance and daily cover
expenses of $1.2 million due to increased compliance requirements under our
landfill operating permits and $4.5 million of other net expense increases.

Segment EBITDA in our Eastern segment increased $15.9 million, or 17.5%, to
$106.9 million for the three months ended September 30, 2021, from $91.0 million
for the three months ended September 30, 2020. The increase was due primarily to
an increase in revenues of $51.8 million and $0.9 million of other net expense
decreases, partially offset by $16.3 million of additional operating costs from
acquisitions closed subsequent to the three months ended September 30, 2020, an
increase in labor expenses of $5.4 million due primarily to employee pay
increases, an increase in third-party trucking and transportation expenses of
$3.2 million due primarily to increased transfer station and landfill special
waste volumes requiring trucking and transportation services to our landfills,
an increase in truck, container, equipment and facility maintenance and repair
expenses of $2.5 million due to parts and service rate increases and variability
in the timing of major repairs, an increase in third-party disposal expenses of
$2.0 million due primarily to increased rates for third party disposal and
increased commercial collection volumes, an increase in leachate expense of $1.8
million due primarily to the impact of hurricanes causing higher precipitation
in certain markets where our landfills are located, an increase in diesel fuel
expense of $1.7 million due to higher fuel prices, an increase in 401(k)
matching expenses of $1.4 million due to the prior year period reflecting less
expenses due to the impact of the June 1, 2020 to December 31, 2020 suspension
of our 401(k) match, an increase in employee medical benefits expenses of $1.4
million due to an increase in medical visits and an increase in taxes on
revenues of $1.1 million due primarily to price-led increases in revenues.

Segment EBITDA in our Eastern segment increased $37.1 million, or 14.4%, to
$295.4 million for the nine months ended September 30, 2021, from $258.3 million
for the nine months ended September 30, 2020. The increase was due primarily to
an increase in revenues of $106.9 million, a decrease in supplemental bonuses
and other cash incentive compensation to non-management personnel of $3.2
million due to the prior year period including non-recurring expenses to
recognize services provided by our front-line employees during the COVID-19
pandemic and a decrease in expenses for uncollectible accounts receivable of
$3.2 million primarily due to the prior year period incurring increased expenses
due to customers experiencing financial difficulties resulting from the economic
impact of the COVID-19 pandemic, partially offset by $27.7 million of additional
operating costs from acquisitions closed subsequent to the nine months ended
September 30, 2020, an increase in labor expenses of $10.4 million due primarily
to employee pay increases, an increase in third-party disposal expenses of $6.2
million due primarily to increased rates paid for third party disposal and
increased volumes in our Northeastern markets as they began to recover in 2021
from economic disruptions attributable to the COVID-19 pandemic, an increase in
third-party trucking and transportation expenses of $6.2 million due primarily
to opening a new transfer station facility in the latter half of 2020 and
increased transfer station volumes in our Northeastern markets as they began to
recover in 2021 from economic disruptions attributable to the COVID-19 pandemic,
an increase in employee medical benefits expenses of $5.0 million due to an
increase in medical visits, an increase in truck, container, equipment and
facility maintenance and repair expenses of $4.9 million due primarily to parts
and service rate increases, an increase in diesel fuel expense of $3.3 million
due to higher fuel prices, an increase in taxes on revenues of $2.6 million due
primarily to price-led increases in revenues, an increase in corporate overhead
expense allocations of $2.0 million due to an increase in the overhead
allocation rate resulting from an increase in corporate expenses qualifying

for
allocation, an

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increase in 401(k) matching expenses of $1.9 million due to the prior year
period reflecting less expenses due to the impact of the June 1, 2020 to
December 31, 2020 suspension of our 401(k) match, an increase in landfill
maintenance expenses of $1.5 million due to increased gas recovery system
operating expenses and expenses incurred to adhere to compliance requirements
under our landfill operating permits and other net expense increases of $4.5
million.

Segment EBITDA in our Southern segment increased $18.2 million, or 22.4%, to
$99.6 million for the three months ended September 30, 2021, from $81.4 million
for the three months ended September 30, 2020. The increase was due to an
increase in revenues of $41.7 million from organic growth and acquisitions,
partially offset by an increase in labor expenses of $5.9 million due primarily
to employee pay increases and headcount additions to support solid waste volume
increases, an increase in truck, container, equipment and facility maintenance
and repair expenses of $4.3 million due to parts and service rate increases and
additional maintenance and repair requirements resulting from increased truck
and equipment operating hours to support increases in our solid waste volumes,
an increase in third-party disposal expenses of $2.4 million due primarily to
increased solid waste collection volumes, an increase in diesel fuel expense of
$2.3 million due to higher fuel prices and increased consumption resulting from
additional truck and equipment operating hours to support solid waste volume
increases, an increase in 401(k) matching expenses of $2.1 million due to the
prior year period reflecting less expenses due to the impact of the June 1, 2020
to December 31, 2020 suspension of our 401(k) match, an increase in third-party
trucking and transportation expenses of $1.7 million due primarily to increased
transfer station and landfill special waste volumes requiring trucking and
transportation services to our landfills, an increase in subcontracted hauling
services of $1.5 million due to outsourcing the servicing of certain
non-strategic collection customers to third party haulers, an increase in
employee medical benefits expenses of $1.5 million due to an increase in medical
visits, an increase in taxes on revenues of $1.0 million due primarily to
increased revenues in our solid waste markets, a decrease to EBITDA of $0.3
million from the impact of operations disposed of subsequent to the three months
ended September 30, 2020 and other net expense increases of $0.5 million.

Segment EBITDA in our Southern segment increased $15.2 million, or 5.5%, to
$292.0 million for the nine months ended September 30, 2021, from $276.8 million
for the nine months ended September 30, 2020. The increase was due to an
increase in solid waste revenues of $74.2 million from organic growth and
acquisitions, a decrease in expenses for auto and workers' compensation claims
of $5.7 million due primarily to higher claims severity in the prior year period
and adjustments recorded in the current year period to decrease projected losses
on outstanding claims originally recorded prior to 2021 and a decrease in
supplemental bonuses and other cash incentive compensation to non-management
personnel of $3.7 million due to the prior year period including non-recurring
expenses to recognize services provided by our front-line employees during the
COVID-19 pandemic, partially offset by a decrease in EBITDA at our E&P
operations of $14.2 million, consisting of a $29.7 million decrease in revenues
being partially offset by a total decrease in expenses of $15.5 million
attributable to declines in disposal volumes, headcount and equipment hours
operated, an increase in labor expenses at our solid waste operations of $8.7
million due primarily to employee pay increases and headcount additions to
support solid waste volume increases, an increase in subcontracted hauling
services at our solid waste operations of $7.6 million due to outsourcing the
servicing of certain non-strategic collection customers to third party haulers,
an increase in truck, container, equipment and facility maintenance and repair
expenses of $6.6 million due to parts and service rate increases and additional
maintenance and repair requirements resulting from increased truck and equipment
operating hours to support increases in our solid waste volumes, an increase in
employee medical benefits expenses of $5.4 million due to an increase in medical
visits, an increase in third-party disposal expenses at our solid waste
operations of $5.2 million due primarily to increased solid waste collection
volumes, an increase in third-party trucking and transportation expenses at our
solid waste operations of $4.8 million due primarily to increased transfer
station and landfill special waste volumes requiring trucking and transportation
services to our landfills, an increase in diesel fuel expense of $3.1 million
due to higher fuel prices and increased consumption resulting from additional
truck and equipment operating hours to support solid waste volume increases, an
increase in 401(k) matching expenses of $2.5 million due to the prior year
period reflecting less expenses due to the impact of the June 1, 2020 to
December 31, 2020 suspension of our 401(k) match, a decrease to EBITDA of $2.4
million from the impact of operations disposed of subsequent to the nine months
ended September 30, 2020, an increase in expenses for uncollectible accounts
receivable of $1.7 million, an increase in taxes on revenues of $1.4 million due
primarily to increased revenues, an increase in corporate overhead expense
allocations of $1.3 million due to an increase in the overhead allocation rate
resulting from an increase in corporate expenses qualifying for allocation, an
increase in leachate expense of $1.2 million due primarily to the impact of
hurricanes causing higher precipitation in certain markets where our landfills
are located and other net expense increases of $2.3 million.

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Segment EBITDA in our Central segment increased $12.1 million, or 14.6%, to
$95.0 million for the three months ended September 30, 2021, from $82.9 million
for the three months ended September 30, 2020. The increase was due primarily to
an increase in revenues of $46.6 million from organic growth and acquisitions,
partially offset by $12.4 million of additional operating costs from certain
acquisitions closed subsequent to the three months ended September 30, 2020, an
increase in labor expenses of $9.0 million due primarily to employee pay
increases and headcount additions to support solid waste volume increases, an
increase in truck, container, equipment and facility maintenance and repair
expenses of $3.1 million due to parts and service rate increases and additional
maintenance and repair requirements resulting from increased truck and equipment
operating hours to support increases in our solid waste volumes, an increase in
third-party disposal expenses of $2.6 million due primarily to increased solid
waste collection volumes, an increase in 401(k) matching expenses of $1.4
million due to the prior year period reflecting less expenses due to the impact
of the June 1, 2020 to December 31, 2020 suspension of our 401(k) match, an
increase in diesel fuel expense of $1.2 million due to higher fuel prices and
increased consumption resulting from additional truck and equipment operating
hours to support solid waste volume increases, an increase in employee medical
benefits expenses of $1.1 million due to an increase in medical visits, an
increase in taxes on revenues of $1.1 million due primarily to increased
revenues in our solid waste markets, a decrease to EBITDA of $0.3 million from
the impact of operations disposed of subsequent to the three months ended
September 30, 2020 and other net expense increases of $2.3 million.

Segment EBITDA in our Central segment increased $33.3 million, or 14.1%, to
$269.0 million for the nine months ended September 30, 2021, from $235.7 million
for the nine months ended September 30, 2020. The increase was due primarily to
an increase in revenues of $126.4 million from organic growth and acquisitions
and a decrease in supplemental bonuses and other cash incentive compensation to
non-management personnel of $2.4 million due to the prior year period including
non-recurring expenses to recognize services provided by our front-line
employees during the COVID-19 pandemic, partially offset by $44.4 million of
additional operating costs from certain acquisitions closed subsequent to the
nine months ended September 30, 2020, an increase in labor expenses of $16.6
million due primarily to employee pay increases and headcount additions to
support solid waste volume increases, an increase in truck, container, equipment
and facility maintenance and repair expenses of $7.0 million due primarily to
parts and service rate increases, an increase in employee medical benefits
expenses of $4.1 million due to an increase in medical visits, an increase in
third-party disposal expenses of $3.7 million due primarily to increased solid
waste collection volumes, an increase in corporate overhead expense allocations
of $3.4 million due to an increase in the overhead allocation rate resulting
from an increase in corporate expenses qualifying for allocation, an increase in
third-party trucking and transportation expenses of $3.3 million due primarily
to increased transfer station and landfill special waste volumes requiring
trucking and transportation services to our landfills, an increase in taxes on
revenues of $2.8 million due primarily to increased revenues, an increase in
expenses for uncollectible accounts receivable of $1.9 million due primarily to
the prior year period collection of certain accounts deemed uncollectible in
2019, an increase in 401(k) matching expenses of $1.9 million due to the prior
year period reflecting less expenses due to the impact of the June 1, 2020 to
December 31, 2020 suspension of our 401(k) match, an increase in diesel fuel
expense of $1.6 million due to higher fuel prices, a decrease to EBITDA of $0.4
million from the impact of operations disposed of subsequent to the nine months
ended September 30, 2020 and other net expense increases of $4.4 million.

Segment EBITDA in our Canada segment increased $19.8 million, or 27.2%, to
$92.3 million for the three months ended September 30, 2021, from $72.5 million
for the three months ended September 30, 2020. The increase was comprised of an
increase of $15.8 million assuming foreign currency parity during the comparable
reporting periods and an increase of $4.0 million from a higher average foreign
currency exchange rate in effect during the comparable reporting periods. The
$15.8 million increase, which assumes foreign currency parity, was due primarily
to an increase in revenues of $29.0 million, partially offset by an increase in
labor expenses of $4.9 million due primarily to employee pay increases and
headcount additions to support solid waste volume increases, an increase in
subcontracted hauling services of $2.2 million due primarily to the prior year
period results including the impact of reversing accrued expenses associated
with estimated equipment charge overages related to an outsourced collection
contract, an increase in diesel fuel expense of $2.0 million due to higher fuel
prices and increased consumption resulting from additional truck and equipment
operating hours to support solid waste volume increases, an increase in
insurance premium expense of $0.9 million due to the prior year period results
including the impact of recording a credit to expense resulting from premium
audit refunds, an increase in expenses for uncollectible accounts receivable of
$0.9 million primarily due to non-recurring expense reductions recorded in the
prior year period to adjust reserves for uncollectible accounts receivable based
upon actual payment defaults from customers experiencing financial difficulties
resulting from the economic impact of the COVID-19 pandemic

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being less than originally estimated, an increase in truck, container, equipment
and facility maintenance and repair expenses of $0.8 million due to parts and
service rate increases and additional maintenance and repair requirements
resulting from increased truck and equipment operating hours to support
increases in our solid waste volumes and other net expense increases of $1.5
million.

Segment EBITDA in our Canada segment increased $69.3 million, or 37.3%, to
$254.9 million for the nine months ended September 30, 2021, from $185.6 million
for the nine months ended September 30, 2020. The increase was comprised of an
increase of $54.6 million assuming foreign currency parity during the comparable
reporting periods and an increase of $14.7 million from a higher average foreign
currency exchange rate in effect during the comparable reporting periods. The
$54.6 million increase, which assumes foreign currency parity, was due primarily
to an increase in revenues of $75.4 million, partially offset by an increase in
labor expenses of $9.1 million due primarily to employee pay increases and
headcount additions to support solid waste volume increases and the receipt in
the prior year period of a government subsidy reimbursing us for certain payroll
expenditures remitted to our employees during the COVID-19 pandemic, an increase
in diesel fuel expense of $4.4 million due to higher fuel prices and increased
consumption resulting from additional truck and equipment operating hours to
support solid waste volume increases, an increase in subcontracted hauling
services of $1.7 million due primarily to the prior year period results
including the impact of reversing accrued expenses associated with estimated
equipment charge overages related to an outsourced collection contract, an
increase in third-party trucking and transportation expenses of $1.4 million due
primarily to increased transfer station and landfill special waste volumes
requiring trucking and transportation services to our landfills, an increase in
truck, container, equipment and facility maintenance and repair expenses of $1.8
million due to parts and service rate increases and additional maintenance and
repair requirements resulting from increased truck and equipment operating hours
to support increases in our solid waste volumes and other net expense increases
of $2.4 million.

Segment EBITDA at Corporate decreased $2.5 million, to a loss of $6.6 million
for the three months ended September 30, 2021, from a loss of $4.1 million for
the three months ended September 30, 2020. The decrease was due to a decrease in
corporate overhead allocated through charges to our segments of $10.2 million
due to a decrease in expenses qualifying for allocation, an increase in direct
acquisition expenses of $3.3 million due to an increase in acquisition activity
in the comparable periods and a collective increase in travel, meeting, training
and community activity expenses of $1.0 million due to increased travel and
social gatherings in the current year period due to a reduction in restrictions
associated with  the COVID-19 pandemic, partially offset by a decrease in cash
incentive compensation expense of $7.9 million due primarily to the prior year
period including expenses for supplemental bonuses and other cash incentive
compensation to non-management personnel to recognize services provided by our
front-line employees during the COVID-19 pandemic, a decrease in equity-based
compensation expenses of $1.2 million resulting primarily from expense increases
recorded during the prior year period to the amount of performance-based
restricted share units granted in 2018 that were estimated to ultimately vest
based on the achievement of required financial performance results, a decrease
in deferred compensation expenses of $1.1 million as a result of higher
increases during the prior year period in the market value of investments to
which employee deferred compensation liability balances are tracked and $1.8
million of other net expense decreases.

Segment EBITDA at Corporate decreased $3.2 million, to a loss of $13.7 million
for the nine months ended September 30, 2021, from a loss of $10.5 million for
the nine months ended September 30, 2020. The decrease was due to an increase in
deferred compensation expenses of $3.1 million as a result of increases in the
market value of investments to which employee deferred compensation liability
balances are tracked, an increase in administrative payroll expenses of $1.7
million due primarily to annual pay increases, an increase in direct acquisition
expenses of $1.7 million due to an increase in acquisition activity in the
comparable periods, an increase in employee relocation expenses of $1.7 million,
a collective increase in travel, meeting, training and community activity
expenses of $1.6 million due to increased travel and social gatherings in the
current year period due to a reduction in restrictions associated with the
COVID-19 pandemic, an increase in equity-based compensation expenses of $1.2
million associated with the net impact of current and prior period adjustments
of our common shares held in our deferred compensation plan by certain key
executives to fair value as a result of the shares being exchanged for other
investment options and $0.7 million of other net expense increases, partially
offset by an increase in corporate overhead allocated through charges to our
segments of $8.5 million due to an increase in expenses qualifying for
allocation.

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LIQUIDITY AND CAPITAL RESOURCES

The following table sets forth certain cash flow information for the nine months ended September 30, 2021 and 2020 (in thousands of U.S. dollars):

                                                                   Nine Months Ended
                                                                     September 30,
                                                                  2021            2020

Net cash provided by operating activities                     $   1,269,961    $ 1,185,573
Net cash used in investing activities                           (1,034,840)

(650,066)

Net cash used in financing activities                             (491,581)

(4,093)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

                                                     443            980
Net increase (decrease) in cash, cash equivalents and
restricted cash                                                   (256,017)

532,394

Cash, cash equivalents and restricted cash at beginning of
period                                                              714,389

423,221

Cash, cash equivalents and restricted cash at end of
period                                                        $     458,372    $   955,615

Operating Activities Cash Flows

For the nine months ended September 30, 2021, net cash provided by operating
activities was $1.270 billion. For the nine months ended September 30, 2020, net
cash provided by operating activities was $1.186 billion. The $84.4 million
increase was due primarily to the following:

Increase in earnings - Our increase in net cash provided by operating

activities was favorably impacted by $109.6 million from an increase in net

income, excluding depreciation, amortization of intangibles, loss on early

extinguishment of debt, share-based compensation, adjustments to and payments

of contingent consideration recorded in earnings and loss on disposal of

1) assets and impairments, due primarily to price increases, earnings from

acquisitions closed subsequent to the nine months ended September 30, 2020,

earnings generated from the increased sales of recyclable commodities and

renewal energy credits associated with the generation of landfill gas and an

increase in the average Canadian dollar to U.S. dollar currency exchange rate

    offsetting a decline in earnings at our E&P operations.


    Deferred income taxes - Our increase in net cash provided by operating

activities was favorably impacted by $53.3 million from deferred income taxes

as changes in deferred income taxes resulted in a decrease to operating cash

flows of $24.3 million for the nine months ended September 30, 2021, compared

to a decrease to operating cash flows of $77.6 million for the nine months

2) ended September 30, 2020. The decrease in deferred taxes for the nine months

ended September 30, 2021 was primarily due to the tax deduction timing of

make-whole premium payments attributable to the early extinguishment of the

outstanding senior notes under our master note purchase agreements. The

decrease in deferred taxes for the nine months ended September 30, 2020 was

attributable to the impairment of certain assets within our E&P operations.

Other long-term liabilities - Our increase in net cash provided by operating

activities was favorably impacted by $17.5 million from other long-term

liabilities, as changes in other long-term liabilities resulted in an increase

to operating cash flows of $12.7 million for the nine months ended September

30, 2021, compared to a decrease to operating cash flows of $4.8 million for

the nine months ended September 30, 2020. The increase for the nine months

3) ended September 30, 2021 was primarily attributable to the receipt of funds

associated with the eminent domain purchase of an operating facility that will

be replaced with a newly constructed facility in a future period and an

increase in employee deferred compensation liabilities. The decrease for the

nine months ended September 30, 2020 was primarily attributable to the cash

settlement of equity awards accounted for as liabilities that were granted to

employees of Progressive Waste prior to June 1, 2016.

Deferred revenue - Our increase in net cash provided by operating activities

was favorably impacted by $12.4 million from deferred revenue as changes in

deferred revenue resulted in an increase to operating cash flows of $15.8

million for the nine months ended September 30, 2021, compared to an increase

4) to operating cash flows of $3.4 million for the nine months ended September

30, 2020. During the nine months ended September 30, 2021, deferred revenue

increased due to price increases on our advanced billed residential and

    commercial collection services and the timing of bi-monthly advance service
    billings.


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Prepaid expenses - Our increase in net cash provided by operating activities

5) was favorably impacted by $12.3 million from prepaid expenses due primarily to

    a decrease in prepaid vendor payments.


    Accounts receivable - Our increase in net cash provided by operating

activities was unfavorably impacted by $88.3 million from accounts receivable

as changes in accounts receivable resulted in a decrease to operating cash

flows of $42.4 million for the nine months ended September 30, 2021, compared

to an increase to operating cash flows of $45.9 million for the nine months

6) ended September 30, 2020. The decrease for the nine months ended September 30,

2021 was due to increases in revenues, which remained as outstanding

receivables at September 30, 2021. The increase for the nine months ended

September 30, 2020 was attributable to the collection of outstanding accounts

receivable existing prior to the COVID-19-driven economic downturn, with

accounts receivable at September 30, 2020 reflecting the impact of lower

uncollected revenues.

Accounts payable and accrued liabilities - Our increase in net cash provided

by operating activities was unfavorably impacted by $17.2 million from

accounts payable and accrued liabilities as changes in accounts payable and

accrued liabilities resulted in an increase to operating cash flows of $52.7

million for the nine months ended September 30, 2021, compared to an increase

to operating cash flows of $69.9 million for the nine months ended September

7) 30, 2020. The increase for the nine months ended September 30, 2021 was due

primarily to increases in operating expenses during the period which remained

as outstanding obligations at September 30, 2021, the settlement of an

acquired compensation liability and the timing of payroll cycles. The increase

for the nine months ended September 30, 2020 was due primarily to increases in

accrued interest expense and accrued incentive compensation expense and the

deferral of payroll taxes as permitted by the Coronavirus Aid, Relief, and

Economic Security Act of 2020.

Capping, closure and post-closure expenditures - Our increase in net cash

8) provided by operating activities was unfavorably impacted by a $10.0 million

increase in capping, closure and post-closure expenditures due to the timing

of interim capping requirements.

As of September 30, 2021, we had a working capital surplus of $15.0 million,
including cash and equivalents of $339.5 million.  Our working capital surplus
decreased $364.6 million from a working capital surplus of $379.6 million at
December 31, 2020 including cash and equivalents of $617.3 million, due
primarily to the impact of decreased cash balances, decreased prepaid income
taxes, increased accounts payable and accrued liabilities and increased deferred
revenue being partially offset by increased accounts receivable. To date, we
have experienced no loss or lack of access to our cash and equivalents; however,
we can provide no assurances that access to our cash and equivalents will not be
impacted by adverse conditions in the financial markets.  Our strategy in
managing our working capital is generally to apply the cash generated from our
operations that remains after satisfying our working capital and capital
expenditure requirements, along with share repurchase and dividend programs, to
reduce the unhedged portion of our indebtedness under our Credit Agreement and
to minimize our cash balances.

Investing Activities Cash Flows

Net cash used in investing activities increased $384.8 million to $1.035 billion
for the nine months ended September 30, 2021, from $650.1 million for the nine
months ended September 30, 2020. The significant components of the increase
included the following:

1) An increase in cash paid for acquisitions of $387.5 million;

An increase in capital expenditures at operations owned in the comparable

2) periods of $48.0 million due to increases in land and buildings, heavy

equipment and containers; and

An increase in capital expenditures at operations acquired during the

3) comparative periods of $10.8 million due to additional trucks and containers;

less

A decrease in capital expenditures for undeveloped landfill property of $66.8

4) million attributable to expenditures during the nine months ended September

    30, 2020 for expansion land at certain existing landfill facilities.


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Financing Activities Cash Flows

Net cash used in financing activities increased $487.5 million to net cash used
in financing activities of $491.6 million for the nine months ended September
30, 2021, from net cash used in financing activities of $4.1 million for the
nine months ended September 30, 2020. The significant components of the increase
included the following:

An increase from the net change in long-term borrowings of $153.1 million

1) (long-term borrowings increased $131.9 million during the nine months ended

September 30, 2021 and increased $285.0 million during the nine months ended

September 30, 2020);

An increase from premiums paid on early extinguishment of debt of $110.6

2) million resulting from the repayment in September 2021 of all of our

outstanding senior notes under our master note purchase agreements;

3) An increase in payments to repurchase our common shares of $200.0 million due

to a higher volume of shares repurchased;

An increase in cash dividends paid of $14.8 million due primarily to an

4) increase in our quarterly dividend rate for the nine months ended September

30, 2021 to $0.205 per share, from $0.185 per share for the nine months ended

September 30, 2020;

5) An increase in debt issuance costs of $6.9 million attributable to senior note

offerings completed in the comparative periods; and

An increase in contingent consideration payments of $5.2 million due primarily

6) to a payment remitted in 2021 to settle a contingent liability assumed in the

Progressive Waste acquisition; less

A decrease in tax withholdings related to net share settlements of

7) equity-based compensation of $4.8 million due to a decrease in the value of

equity-based compensation awards vesting.

Our business is capital intensive. Our capital requirements include acquisitions
and capital expenditures for landfill cell construction, landfill development,
landfill closure activities and intermodal facility construction in the future.

On July 27, 2021, our Board of Directors approved, subject to receipt of
regulatory approvals, the annual renewal of our normal course issuer bid, or the
NCIB, to purchase up to 13,025,895 of our common shares during the period of
August 10, 2021 to August 9, 2022 or until such earlier time as the NCIB is
completed or terminated at our option. Shareholders may obtain a copy of our TSX
Form 12 - Notice of Intention to Make a Normal Course Issuer Bid, without
charge, by request directed to our Executive Vice President and Chief Financial
Officer at [phone].  The timing and amounts of any repurchases pursuant
to the NCIB will depend on many factors, including our capital structure, the
market price of our common shares and overall market conditions. All common
shares purchased under the NCIB will be immediately cancelled following their
repurchase.  Information regarding our NCIB can be found under the
"Shareholders' Equity" section in Note 17 to the Condensed Consolidated
Financial Statements included in Part I, Item 1 of this Quarterly Report on Form
10-Q and is incorporated herein by reference.

Our Board of Directors authorized the initiation of a quarterly cash dividend in
October 2010 and has increased it on an annual basis. In October 2020, our Board
of Directors authorized an increase to our regular quarterly cash dividend of
$0.02, from $0.185 to $0.205 per share.  In October 2021, our Board of Directors
authorized an increase to our regular quarterly cash dividend of $0.025, from
$0.205 to $0.230 per share.  Cash dividends of $160.8 million and $145.9 million
were paid during the nine months ended September 30, 2021 and 2020,
respectively. We cannot assure you as to the amounts or timing of future
dividends.

We made $479.5 million in capital expenditures for property and equipment during
the nine months ended September 30, 2021, and we expect to make total capital
expenditures for property and equipment of approximately $700 million in 2021.
 We have funded and intend to fund the balance of our planned 2021 capital
expenditures principally through cash on hand, internally generated funds and
borrowings under our 2021 Credit Agreement. In addition, we may make substantial
additional capital expenditures in acquiring land and solid waste businesses. If
we acquire additional landfill disposal facilities, we may also have to make
significant expenditures to bring them into compliance with applicable
regulatory requirements, obtain permits or expand our available disposal
capacity. We cannot currently determine the amount of these expenditures because
they will depend on the number, nature, condition and permitted status of any
acquired landfill disposal facilities. We believe that our cash and equivalents,
2021 Credit Agreement and the funds we expect to generate from operations will
provide adequate cash to fund our working capital and other cash needs for

the

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foreseeable future. However, disruptions in the capital and credit markets could
adversely affect our ability to draw on our 2021 Credit Agreement or raise other
capital. Our access to funds under the 2021 Credit Agreement is dependent on the
ability of the banks that are parties to the agreement to meet their funding
commitments. Those banks may not be able to meet their funding commitments if
they experience shortages of capital and liquidity or if they experience
excessive volumes of borrowing requests within a short period of time.

As of September 30, 2021, $650.0 million under the term loan and $634.9 million
under the revolving credit facility were outstanding under our 2021 Credit
Agreement, exclusive of outstanding standby letters of credit of $114.7 million.
We also have $6.8 million of letters of credit issued and outstanding at
September 30, 2021 under facilities other than the 2021 Credit Agreement.  Our
2021 Credit Agreement matures in July 2026.

On September 20, 2021, we completed an underwritten public offering (the
"Offering") of $650.0 million aggregate principal amount of 2.20% Senior Notes
due 2032 (the "2032 Senior Notes") and $850.0 million aggregate principal amount
of 2.95% Senior Notes due 2052 (the "2052 Senior Notes" and, together with the
2032 Senior Notes, the "Notes"). We issued the Notes under the Indenture, dated
as of November 16, 2018, by and between the Company and U.S. Bank National
Association, as trustee, as supplemented by the Fifth Supplemental Indenture,
dated as of September 20, 2021.

In connection with the Offering, we exercised our right to repay the $1.500
billion of senior notes (the "Private Notes") that were governed by our 2008 and
2016 master note purchase agreements. We repaid the Private Notes, including the
$110.6 million make-whole payment, with the net proceeds from the Offering and
borrowings under the revolving credit facility provided under our 2021 Credit
Agreement. We recorded $115.3 million to Loss on early extinguishment of debt
during the nine months ended September 30, 2021 due to the repayment of the
Private Notes and associated make-whole premium and related fees.

We will pay interest on the Notes semi-annually in arrears. The 2032 Senior
Notes will mature on January 15, 2032 and the 2052 Senior Notes will mature on
January 15, 2052. The Notes are our senior unsecured obligations, ranking
equally in right of payment with our other existing and future unsubordinated
debt and senior to any of our future subordinated debt. The Notes are not
guaranteed by any of our subsidiaries.

See Note 10 to our Condensed Consolidated Financial Statements included in Part I, Items 1 of this report for further details on the debt agreements.

We are a well-known seasoned issuer with an effective shelf registration
statement on Form S-3 filed in September 2021, which registers an unspecified
amount of debt securities, including debentures, notes or other types of debt.
In the future, we may issue debt securities under our shelf registration
statement or in private placements from time to time on an opportunistic basis,
based on market conditions and available pricing. Unless otherwise indicated in
the relevant offering documents, we expect to use the proceeds from any such
offerings for general corporate purposes, including repaying, redeeming or
repurchasing debt, acquiring additional assets or businesses, capital
expenditures and increasing our working capital.

As of September 30, 2021, we had the following contractual obligations:

                                                                   Payments Due by Period
                                                           (amounts in

thousands of U.S. dollars)

                                                          Less Than      1 to 3                          Over 5
Recorded Obligations                          Total         1 Year        Years       3 to 5 Years        Years
Long-term debt                             $ 4,930,395    $    5,289    $  10,843    $    1,296,186    $ 3,618,077
Cash interest payments                     $ 1,963,715    $  140,932    $ 297,562    $      277,549    $ 1,247,672
Contingent consideration                   $    85,819    $   42,359    $   5,724    $        3,224    $    34,512
Operating leases                           $   198,888    $    9,922    $ 

70,255 $ 43,761 $ 74,950 Final capping, closure and post-closure $ 1,512,933 $ 12,680 $ 41,607 $ 9,525 $ 1,449,121

____________________



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Long-term debt payments include:

$634.9 million in principal payments due July 2026 related to our revolving

credit facility under our 2021 Credit Agreement. We may elect to draw amounts

on our 2021 Credit Agreement in U.S. dollar LIBOR rate loans, U.S. dollar base

rate loans, Canadian-based bankers' acceptances or BA equivalent notes, and

Canadian dollar prime rate loans. At September 30, 2021, $631.0 million of

1) the outstanding borrowings drawn under the revolving credit facility were in

U.S. LIBOR rate loans, which bear interest at the LIBOR rate plus the

applicable margin (for a total rate of 1.09% on such date) and $3.9 million of

the outstanding borrowings drawn under the revolving credit facility were in

Canadian-based bankers' acceptances, which bear interest at the Canadian

Dollar Offered Rate plus the applicable acceptance fee (for a total rate of

1.43% on such date).

$650.0 million in principal payments due July 2026 related to our term loan

under our 2021 Credit Agreement. Outstanding amounts on the term loan can be

2) either base rate loans or LIBOR loans. At September 30, 2021, all amounts

outstanding under the term loan were in LIBOR loans which bear interest at the

LIBOR rate plus the applicable margin (for a total rate of 1.09% on such

date).

3) $500.0 million in principal payments due 2028 related to our 2028 Senior

Notes. The 2028 Senior Notes bear interest at a rate of 4.25%.

4) $500.0 million in principal payments due 2029 related to our 2029 Senior

Notes. The 2029 Senior Notes bear interest at a rate of 3.50%.

5) $600.0 million in principal payments due 2030 related to our 2030 Senior

Notes. The 2030 Senior Notes bear interest at a rate of 2.60%.

6) $650.0 million in principal payments due 2032 related to our 2032 Senior

Notes. The 2032 Senior Notes bear interest at a rate of 2.20%.

7) $500.0 million in principal payments due 2050 related to our 2050 Senior

Notes. The 2050 Senior Notes bear interest at a rate of 3.05%.

8) $850.0 million in principal payments due 2052 related to our 2052 Senior

Notes. The 2052 Senior Notes bear interest at a rate of 2.95%.

$38.3 million in principal payments related to our notes payable to sellers

9) and other third parties. Our notes payable to sellers and other third parties

bear interest at rates between 2.42% and 10.35% at September 30, 2021, and

have maturity dates ranging from 2028 to 2036.

$7.1 million in principal payments related to our financing leases. Our

10) financing leases bear interest at a rate of 1.89% at September 30, 2021, and

have a lease expiration date of 2026.

The following assumptions were made in calculating cash interest payments:

We calculated cash interest payments on the 2021 Credit Agreement using the

LIBOR rate plus the applicable LIBOR margin, the base rate plus the applicable

1) base rate margin, the Canadian Dollar Offered Rate plus the applicable

acceptance fee and the Canadian prime rate plus the applicable prime rate

margin at September 30, 2021. We assumed the 2021 Credit Agreement is paid off

when it matures in July 2026.

We calculated cash interest payments on our interest rate swaps using the

2) stated interest rate in the swap agreement less the LIBOR rate through the

earlier expiration of the term of the swaps or the term of the credit

facility.

Contingent consideration payments include $67.0 million recorded as liabilities
in our Condensed Consolidated Financial Statements at September 30, 2021, and
$18.8 million of future interest accretion on the recorded obligations.

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We are party to operating lease agreements and finance leases. These lease agreements are established in the ordinary course of our business and are designed to provide us with access to facilities and equipment at competitive, market-driven prices.

The estimated final capping, closure and post-closure expenditures presented
above are in current dollars.




                                                         Amount of

Commitment Expiration Per Period

                                                           (amounts in thousands of U.S. dollars)
                                                                Less Than       1 to 3      3 to 5      Over 5
Unrecorded Obligations(1)                        Total           1 Year         Years       Years       Years

Unconditional purchase obligations            $    121,120     $    67,308

   $ 53,812    $      -    $      -


____________________

We are party to unconditional purchase obligations. These purchase

obligations are established in the ordinary course of our business and are

designed to provide us with access to products at competitive, market-driven

prices. At September 30, 2021, our unconditional purchase obligations

consisted of multiple fixed-price fuel purchase contracts under which we have

(1) 48.6 million gallons remaining to be purchased for a total of $121.1 million.

The current fuel purchase contracts expire on or before February 28, 2024.

These arrangements have not materially affected our financial position,

results of operations or liquidity during the nine months ended September 30,

2021, nor are they expected to have a material impact on our future financial

position, results of operations or liquidity.

We have obtained financial surety bonds, primarily to support our financial
assurance needs and landfill and E&P operations. We provided customers and
various regulatory authorities with surety bonds in the aggregate amounts of
approximately $1.286 billion and $1.210 billion at September 30, 2021 and
December 31, 2020, respectively. These arrangements have not materially affected
our financial position, results of operations or liquidity during the nine
months ended September 30, 2021, nor are they expected to have a material impact
on our future financial position, results of operations or liquidity.

From time to time, we evaluate our existing operations and their strategic importance to us. If we determine that a given operating unit does not have future strategic importance, we may sell or otherwise dispose of those operations. Although we believe our reporting units would not be impaired by such dispositions, we could incur losses on them.

The disposal tonnage that we received in the nine month periods ended September 30, 2021 and 2020, at all of our landfills during the respective period, is shown below (tons in thousands):

                                                         Nine Months Ended September 30,
                                                            2021                  2020
                                                      Number     Total      Number     Total
                                                     of Sites     Tons     of Sites     Tons
Owned operational landfills and landfills
operated under life-of-site agreements                     89    35,167    

     89    33,268
Operated landfills                                          5       421           4       413
                                                           94    35,588          93    33,681




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NON-GAAP FINANCIAL MEASURES

Adjusted Free Cash Flow

We present adjusted free cash flow, a non-GAAP financial measure, supplementally
because it is widely used by investors as a valuation and liquidity measure in
the solid waste industry. Management uses adjusted free cash flow as one of the
principal measures to evaluate and monitor the ongoing financial performance of
our operations. We define adjusted free cash flow as net cash provided by
operating activities, plus or minus change in book overdraft, plus proceeds from
disposal of assets, less capital expenditures for property and equipment and
distributions to noncontrolling interests. We further adjust this calculation to
exclude the effects of items management believes impact the ability to assess
the operating performance of our business. This measure is not a substitute for,
and should be used in conjunction with, GAAP liquidity or financial measures.
Other companies may calculate adjusted free cash flow differently. Our adjusted
free cash flow for the nine month periods ended September 30, 2021 and 2020, are
calculated as follows (amounts in thousands of U.S. dollars):




                                                                    Nine Months Ended
                                                                      September 30,
                                                                   2021           2020

Net cash provided by operating activities                       $ 1,269,961    $ 1,185,573
Less: Change in book overdraft                                        (563)

(862)

Plus: Proceeds from disposal of assets                               10,109

11,564

Less: Capital expenditures for property and equipment             (479,480)

(420,694)

Adjustments:

Payment of contingent consideration recorded in earnings (a)            520              -
Cash received for divestitures (b)                                        -

(4,974)

Transaction-related expenses (c)                                     25,673

4,497

Pre-existing Progressive Waste share-based grants (d)                   317

         7,455
Tax effect (e)                                                        (699)        (4,168)
Adjusted free cash flow                                         $   825,838    $   778,391


____________________

Reflects the addback of acquisition-related payments for contingent (a) consideration that were recorded as expenses in earnings and as a component

of cash flows from operating activities as the amounts paid exceeded the fair

value of the contingent consideration recorded at the acquisition date.

(b) Reflects the elimination of cash received in conjunction with the divestiture

of certain operations.

(c) Reflects the addback of acquisition-related transaction costs and settlement

of an acquired compensation liability.

(d) Reflects the cash settlement of pre-existing Progressive Waste share-based

awards during the period.

(e) The aggregate tax effect of footnotes (a) through (d) is calculated based on

    the applied tax rates for the respective periods.




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Adjusted EBITDA

We present adjusted EBITDA, a non-GAAP financial measure, supplementally because
it is widely used by investors as a performance and valuation measure in the
solid waste industry. Management uses adjusted EBITDA as one of the principal
measures to evaluate and monitor the ongoing financial performance of our
operations. We define adjusted EBITDA as net income attributable to Waste
Connections, plus or minus net income (loss) attributable to noncontrolling
interests, plus income tax provision, plus interest expense, less interest
income, plus depreciation and amortization expense, plus closure and
post-closure accretion expense, plus or minus any loss or gain on impairments
and other operating items, plus other expense, less other income. We further
adjust this calculation to exclude the effects of other items management
believes impact the ability to assess the operating performance of our business.
This measure is not a substitute for, and should be used in conjunction with,
GAAP financial measures. Other companies may calculate adjusted EBITDA
differently. Our adjusted EBITDA for the three and nine month periods ended
September 30, 2021 and 2020, are calculated as follows (amounts in thousands of
U.S. dollars):




                                                Three Months Ended          Nine Months Ended
                                                  September 30,               September 30,
                                                2021         2020          2021           2020
Net income attributable to Waste
Connections                                   $ 114,381    $ 158,049    $   451,736    $    74,012
Plus (less): Net income (loss)
attributable to noncontrolling interests            273         (58)       

    325          (594)
Plus: Income tax provision                       18,419       33,657        106,578         23,654
Plus: Interest expense                           40,418       40,636        124,171        119,562
Less: Interest income                             (495)        (903)        (2,342)        (4,396)

Plus: Depreciation and amortization             207,302      190,243        598,825        555,703
Plus: Closure and post-closure accretion          3,544        3,723         10,919         11,340
Plus: Impairments and other operating
items                                             3,104        3,805          9,819        442,582
Plus (less): Other expense (income), net        (3,140)        (702)        (5,452)          3,046
Plus: Loss on early extinguishment of debt      115,288            -        115,288              -

Adjustments:

Plus: Transaction-related expenses (a)            5,637        2,335          6,220          4,497
Plus: Fair value changes to equity awards
(b)                                                 914        1,798          7,638          6,021
Adjusted EBITDA                               $ 505,645    $ 432,583    $ 1,423,725    $ 1,235,427


____________________

(a) Reflects the addback of acquisition-related transaction costs.

(b) Reflects fair value accounting changes associated with certain equity awards.

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Adjusted Net Income Attributable to Waste Connections and Adjusted Net Income per Diluted Share Attributable to Waste Connections

We present adjusted net income attributable to Waste Connections and adjusted
net income per diluted share attributable to Waste Connections, both non-GAAP
financial measures, supplementally because they are widely used by investors as
a valuation measure in the solid waste industry. Management uses adjusted net
income attributable to Waste Connections and adjusted net income per diluted
share attributable to Waste Connections as one of the principal measures to
evaluate and monitor the ongoing financial performance of our operations. We
provide adjusted net income attributable to Waste Connections to exclude the
effects of items management believes impact the comparability of operating
results between periods. Adjusted net income attributable to Waste Connections
has limitations due to the fact that it excludes items that have an impact on
our financial condition and results of operations. Adjusted net income
attributable to Waste Connections and adjusted net income per diluted share
attributable to Waste Connections are not a substitute for, and should be used
in conjunction with, GAAP financial measures. Other companies may calculate
these non-GAAP financial measures differently. Our adjusted net income
attributable to Waste Connections and adjusted net income per diluted share
attributable to Waste Connections for the three and nine month periods ended
September 30, 2021 and 2020, are calculated as follows (amounts in thousands of
U.S. dollars, except per share amounts):




                                                   Three Months Ended           Nine Months Ended
                                                     September 30,               September 30,
                                                   2021          2020          2021          2020
Reported net income attributable to Waste
Connections                                     $  114,381    $  158,049    $  451,736    $    74,012
Adjustments:
Amortization of intangibles (a)                     35,337        32,653       100,237         96,062
Impairments and other operating items (b)            3,104         3,805         9,819        442,582
Transaction-related expenses (c)                     5,637         2,335         6,220          4,497
Fair value changes to equity awards (d)                914         1,798         7,638          6,021
Loss on early extinguishment of debt (e)           115,288             -   

   115,288              -
Tax effect (f)                                    (41,531)      (10,000)      (61,466)      (137,523)
Tax items (g)                                            -             -             -         31,508
Adjusted net income attributable to Waste
Connections                                     $  233,130    $  188,640

$ 629,472 $ 517,159

Diluted earnings per common share
attributable to Waste Connections' common
shareholders:
Reported net income                             $     0.44    $     0.60    $     1.72    $      0.28
Adjusted net income                             $     0.89    $     0.72    $     2.39    $      1.96


____________________

(a) Reflects the elimination of the non-cash amortization of acquisition-related

intangible assets.

(b) Reflects the addback of impairments and other operating items.

(c) Reflects the addback of acquisition-related transaction costs.

(d) Reflects fair value accounting changes associated with certain equity awards.

(e) Reflects the make-whole premium and related fees associated with the early

termination of $1.5 billion in senior notes.

(f) The aggregate tax effect of the adjustments in footnotes (a) through (e) is

calculated based on the applied tax rates for the respective periods.

Reflects the impact of a portion of our 2019 inter-entity payments no longer (g) being deductible for tax purposes due to the finalization of tax regulations

on April 7, 2020 under Internal Revenue Code section 267A and an increase in

deferred tax liabilities resulting from the E&P impairment.

INFLATION

In the current environment, we have seen inflationary pressures resulting from
higher fuel and labor costs in certain markets and higher resulting third party
costs in areas such as brokerage, repairs and construction.  Consistent with
industry practice, many of our contracts allow us to pass through certain costs
to our customers, including increases in landfill tipping fees and, in some
cases, fuel costs.  To the extent that there are decreases in fuel costs, in
some cases, a portion of these reductions are passed through to customers in the
form of lower fuel and material surcharges. Therefore, we believe that we should
be able to increase prices to offset many cost increases that result from
inflation in the ordinary course of

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business. However, competitive pressures or delays in the timing of rate
increases under certain of our contracts, particularly amid the economic impact
of the COVID-19 pandemic, may require us to absorb at least part of these cost
increases, especially if cost increases exceed the average rate of inflation.
Management's estimates associated with inflation have an impact on our
accounting for landfill liabilities.

SEASONALITY

Based on historic trends, excluding any impact from the COVID-19 pandemic or an
economic recession, we would expect our operating results to vary seasonally,
with revenues typically lowest in the first quarter, higher in the second and
third quarters and lower in the fourth quarter than in the second and third
quarters. This seasonality reflects (a) the lower volume of solid waste
generated during the late fall, winter and early spring because of decreased
construction and demolition activities during winter months in Canada and the
U.S. and (b) reduced E&P activity during harsh weather conditions, with expected
fluctuation due to such seasonality between our highest and lowest quarters of
approximately 10%. In addition, some of our operating costs may be higher in the
winter months. Adverse winter weather conditions slow waste collection
activities, resulting in higher labor and operational costs. Greater
precipitation in the winter increases the weight of collected municipal solid
waste, resulting in higher disposal costs, which are calculated on a per ton
basis.

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