Name: Waste Management Inc. (NYSE:WM) | Cash Flow Statement
Creator: Stock Analysis on Net

Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

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Waste Management Inc., consolidated cash flow statement

US$ in millions

12 months ended:	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Consolidated net income	1,817)	1,496)	1,671)	1,923)	1,949)
Depreciation and amortization	1,999)	1,671)	1,574)	1,477)	1,376)
Deferred income tax expense (benefit)	(77)	165)	100)	25)	(251)
Interest accretion on landfill and environmental remediation liabilities	111)	103)	98)	95)	92)
Provision for bad debts	37)	54)	39)	54)	43)
Equity-based compensation expense	108)	94)	86)	89)	101)
Net gain on disposal of assets	(25)	(9)	(27)	(47)	(20)
(Gain) loss from divestitures, asset impairments and other, net	(16)	43)	113)	(58)	43)
Equity in net losses of unconsolidated entities, net of dividends	38)	60)	55)	41)	39)
Loss on early extinguishment of debt, net	220)	53)	85)	—)	6)
Receivables	28)	(179)	(53)	(16)	(271)
Other current assets	(39)	10)	(23)	(16)	(20)
Other assets	34)	53)	10)	(14)	4)
Accounts payable and accrued liabilities	206)	(37)	243)	203)	126)
Deferred revenues and other liabilities	(103)	(174)	(97)	(186)	(37)
Change in operating assets and liabilities, net of effects of acquisitions and divestitures	126)	(327)	80)	(29)	(198)
Adjustments to reconcile consolidated net income to net cash provided by operating activities	2,521)	1,907)	2,203)	1,647)	1,231)
Net cash provided by operating activities	4,338)	3,403)	3,874)	3,570)	3,180)
Acquisitions of businesses, net of cash acquired	(75)	(4,085)	(521)	(460)	(200)
Capital expenditures	(1,904)	(1,632)	(1,818)	(1,694)	(1,509)
Proceeds from divestitures of businesses and other assets, net of cash divested	96)	885)	49)	208)	99)
Net receipts from restricted trust and escrow accounts	—)	—)	—)	—)	243)
Other, net	(11)	(15)	(86)	(223)	(12)
Net cash used in investing activities	(1,894)	(4,847)	(2,376)	(2,169)	(1,379)
New borrowings	7,948)	9,420)	13,237)	812)	1,540)
Debt repayments	(8,404)	(9,629)	(10,088)	(499)	(1,907)
Premiums and other paid on early extinguishment of debt	(211)	(30)	(84)	—)	(8)
Common stock repurchase program	(1,350)	(402)	(248)	(1,004)	(750)
Cash dividends	(970)	(927)	(876)	(802)	(750)
Exercise of common stock options	66)	63)	67)	52)	95)
Tax payments associated with equity-based compensation transactions	(28)	(34)	(33)	(29)	(47)
Other, net	49)	(20)	(11)	(38)	16)
Net cash provided by (used in) financing activities	(2,900)	(1,559)	1,964)	(1,508)	(1,811)
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents	2)	4)	2)	(3)	—)
Increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents	(454)	(2,999)	3,464)	(110)	(10)
Cash, cash equivalents and restricted cash and cash equivalents at beginning of period	648)	3,647)	183)	293)	32)
Cash, cash equivalents and restricted cash and cash equivalents at end of period	194)	648)	3,647)	183)	22)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

The cash flow profile from 2017 to 2021 reflects a company with strong operational cash generation, significant periodic strategic acquisitions, and a consistent policy of returning capital to shareholders.

Operating Cash Flow Performance: Net cash provided by operating activities demonstrates a general upward trend, increasing from $3,180 million in 2017 to $4,338 million in 2021. Despite a dip in 2020 to $3,403 million, the overall trajectory remains positive. This growth is supported by a steady increase in depreciation and amortization, which rose from $1,376 million in 2017 to $1,999 million in 2021, indicating a substantial asset base. Consolidated net income experienced volatility, reaching a low of $1,496 million in 2020 before recovering to $1,817 million in 2021.
Investing Activities and Capital Expenditure: Capital expenditures remained relatively stable, ranging between $1,509 million and $1,904 million annually, suggesting a consistent reinvestment in core infrastructure. A significant anomaly occurred in 2020, where net cash used in investing activities spiked to $4,847 million, primarily driven by $4,085 million in business acquisitions. This strategic expansion was partially offset by $885 million in proceeds from divestitures in the same year.
Financing and Capital Allocation: Financing activities indicate active debt management and a commitment to shareholder distributions. Debt activity peaked in 2019, with new borrowings of $13,237 million and repayments of $10,088 million, suggesting a major refinancing event. Shareholder returns were prioritized through steadily increasing cash dividends, which grew from $750 million in 2017 to $970 million in 2021. Common stock repurchases were more volatile, with a significant increase to $1,350 million in 2021 following a period of lower buyback activity.
Liquidity and Cash Position: The ending cash, cash equivalents, and restricted cash balance showed extreme fluctuation. A peak of $3,647 million was reached in 2019, followed by a sharp decline to $648 million in 2020, correlating with the heavy acquisition spending. By the end of 2021, the cash position settled at $194 million, indicating that operating cash flows and new borrowings were largely utilized for acquisitions, debt repayment, and shareholder returns.

Overall, the financial data reveals a business model capable of generating robust cash from operations to fund both maintenance capital expenditures and aggressive growth through acquisitions, while maintaining a disciplined approach to dividend growth.

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