Analysis of Reportable Segments
Waste Management Inc. operates in 2 segments: East Tier and West Tier.
Segment Profit Margin
Waste Management Inc., profit margin by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 21.96% | 21.24% | 22.81% | — | — |
| West Tier | 22.45% | 21.84% | 23.33% | — | — |
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 profit margins for the East and West Tiers exhibit a synchronized performance pattern from 2019 through 2021, characterized by a mid-period contraction followed by a partial recovery. Both segments reached a peak in 2019 and experienced a simultaneous decline in 2020.
- East Tier Profitability
- The East Tier recorded a profit margin of 22.81% in 2019, which decreased to 21.24% in 2020. This represented a contraction of 1.57 percentage points before a subsequent recovery to 21.96% in 2021.
- West Tier Profitability
- The West Tier demonstrated a similar trend, starting at 23.33% in 2019 and falling to 21.84% in 2020. A modest recovery was observed in 2021, with the margin increasing to 22.45%.
- Comparative Segment Performance
- The West Tier consistently maintained a higher profit margin than the East Tier throughout the reported period. The margin differential remained relatively stable, with the West Tier sustaining a lead of approximately 0.5 to 0.8 percentage points over the East Tier across all three years.
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Segment Profit Margin: East Tier
Waste Management Inc.; East Tier; segment profit margin calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income from operations | 2,037) | 1,672) | 1,847) | —) | —) |
| Gross operating revenues | 9,278) | 7,873) | 8,098) | —) | —) |
| Segment Profitability Ratio | |||||
| Segment profit margin1 | 21.96% | 21.24% | 22.81% | — | — |
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).
1 2021 Calculation
Segment profit margin = 100 × Income from operations ÷ Gross operating revenues
= 100 × 2,037 ÷ 9,278 = 21.96%
The East Tier segment demonstrated fluctuations in operational profitability and revenue growth between 2019 and 2021. After a period of contraction in 2020, the segment showed a significant recovery in 2021, particularly regarding gross operating revenues and absolute income from operations.
- Gross Operating Revenues
- Revenues decreased from US$ 8,098 million in 2019 to US$ 7,873 million in 2020, before rising sharply to US$ 9,278 million in 2021. This represents a substantial expansion in the final year of the period, surpassing 2019 levels by approximately 14.6%.
- Income from Operations
- Operational income followed a similar trajectory, declining from US$ 1,847 million in 2019 to US$ 1,672 million in 2020, and subsequently increasing to US$ 2,037 million by the end of 2021. The recovery in 2021 suggests a strong return to operational productivity.
- Segment Profit Margin
- The profit margin contracted from 22.81% in 2019 to 21.24% in 2020. While the margin improved to 21.96% in 2021, it did not fully return to the 2019 peak. This indicates that while the segment grew in scale and absolute profit, the efficiency of converting revenue into operating income remained slightly below 2019 levels.
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Segment Profit Margin: West Tier
Waste Management Inc.; West Tier; segment profit margin calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income from operations | 2,103) | 1,800) | 1,934) | —) | —) |
| Gross operating revenues | 9,369) | 8,241) | 8,289) | —) | —) |
| Segment Profitability Ratio | |||||
| Segment profit margin1 | 22.45% | 21.84% | 23.33% | — | — |
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).
1 2021 Calculation
Segment profit margin = 100 × Income from operations ÷ Gross operating revenues
= 100 × 2,103 ÷ 9,369 = 22.45%
The West Tier segment exhibited fluctuating operational performance from 2019 through 2021, characterized by a contraction in profitability during 2020 followed by a robust recovery in both absolute income and revenue by 2021.
- Revenue and Operating Income Trends
- Gross operating revenues remained relatively stable between 2019 and 2020, experiencing a marginal decline from 8,289 million US$ to 8,241 million US$. However, 2021 saw a significant expansion, with revenues increasing to 9,369 million US$. Income from operations followed a similar trajectory, falling from 1,934 million US$ in 2019 to 1,800 million US$ in 2020, before reaching a period peak of 2,103 million US$ in 2021.
- Segment Profit Margin Analysis
- The segment profit margin decreased from 23.33% in 2019 to 21.84% in 2020, indicating a compression in operational efficiency during that period. While the margin recovered to 22.45% in 2021, it remained below the 2019 level despite the substantial increase in gross operating revenues. This divergence suggests that while the segment successfully expanded its top-line growth, the associated operating costs scaled at a rate that prevented the profit margin from fully returning to its 2019 baseline.
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Segment Return on Assets (Segment ROA)
Waste Management Inc., ROA by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 14.28% | 11.71% | 15.92% | — | — |
| West Tier | 18.33% | 15.65% | 19.90% | — | — |
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 analysis of segment return on assets for the period between 2019 and 2021 reveals a consistent V-shaped performance trend across both the East and West Tiers. Both operational segments experienced a significant contraction in asset efficiency during 2020, followed by a partial recovery in 2021.
- East Tier Performance
- The East Tier recorded a return on assets of 15.92% in 2019, which declined to 11.71% in 2020, representing a decrease of 421 basis points. In 2021, the segment demonstrated recovery, with the ratio increasing to 14.28%. Despite this improvement, the return remained 164 basis points below the 2019 baseline.
- West Tier Performance
- The West Tier exhibited a similar trajectory, starting at 19.90% in 2019 and falling to 15.65% in 2020, a decline of 425 basis points. The segment rebounded to 18.33% in 2021. Similar to the East Tier, the recovery was substantial but did not fully return to pre-2020 levels, ending 157 basis points lower than the 2019 figure.
- Comparative Analysis
- A persistent performance gap is observed between the two segments, as the West Tier consistently maintained a higher return on assets than the East Tier throughout the three-year period. The correlation in the timing and magnitude of the fluctuations suggests that both segments were impacted by similar macroeconomic or systemic factors during 2020 and benefited from identical recovery drivers in 2021.
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Segment ROA: East Tier
Waste Management Inc.; East Tier; segment ROA calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income from operations | 2,037) | 1,672) | 1,847) | —) | —) |
| Total assets | 14,269) | 14,274) | 11,600) | —) | —) |
| Segment Profitability Ratio | |||||
| Segment ROA1 | 14.28% | 11.71% | 15.92% | — | — |
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).
1 2021 Calculation
Segment ROA = 100 × Income from operations ÷ Total assets
= 100 × 2,037 ÷ 14,269 = 14.28%
The East Tier segment exhibited volatility in its asset utilization and operational efficiency between 2019 and 2021, characterized by a significant contraction in performance during 2020 followed by a partial recovery in 2021.
- Income from Operations
- Operational earnings experienced a fluctuations during the period, decreasing from 1,847 million US dollars in 2019 to 1,672 million US dollars in 2020. However, a strong recovery occurred in 2021, with income rising to 2,037 million US dollars, representing a 21.8% increase over the previous year and surpassing 2019 levels.
- Total Assets
- The asset base expanded significantly between 2019 and 2020, growing from 11,600 million US dollars to 14,274 million US dollars, a rise of approximately 23.1%. This asset level remained nearly constant through 2021, ending the period at 14,269 million US dollars.
- Segment ROA
- The Return on Assets (ROA) declined from 15.92% in 2019 to 11.71% in 2020. This deterioration was the result of a dual impact: declining operating income coupled with a substantially larger asset base. By 2021, the ROA improved to 14.28%, driven by the increase in operating income while the asset base remained stable. Despite this recovery, the 2021 ROA remained below the 2019 peak.
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Segment ROA: West Tier
Waste Management Inc.; West Tier; segment ROA calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income from operations | 2,103) | 1,800) | 1,934) | —) | —) |
| Total assets | 11,476) | 11,501) | 9,720) | —) | —) |
| Segment Profitability Ratio | |||||
| Segment ROA1 | 18.33% | 15.65% | 19.90% | — | — |
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).
1 2021 Calculation
Segment ROA = 100 × Income from operations ÷ Total assets
= 100 × 2,103 ÷ 11,476 = 18.33%
The West Tier segment exhibited a fluctuating performance trend from 2019 to 2021, characterized by a contraction in asset efficiency in 2020 followed by a partial recovery in 2021.
- Income from Operations
- Operational income experienced a decline in 2020, falling to US$ 1,800 million from US$ 1,934 million in 2019. This downward trend reversed in 2021, with income rising to US$ 2,103 million, marking a 16.8% increase over 2020 and reaching the highest level observed within the analyzed period.
- Total Assets
- A significant increase in the asset base occurred in 2020, where total assets grew from US$ 9,720 million to US$ 11,501 million, representing an expansion of approximately 18.3%. The asset base remained relatively stable into 2021, concluding the period at US$ 11,476 million.
- Segment Return on Assets (ROA)
- The Segment ROA decreased from 19.90% in 2019 to 15.65% in 2020, a decline driven by the combination of lower operational income and a substantially larger asset base. In 2021, the ROA improved to 18.33%, as operational income grew while total assets remained constant, though the ratio did not fully return to 2019 levels.
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Segment Asset Turnover
Waste Management Inc., asset turnover by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 0.65 | 0.55 | 0.70 | — | — |
| West Tier | 0.82 | 0.72 | 0.85 | — | — |
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 asset turnover ratios for the reportable segments demonstrate a synchronized trend characterized by a performance dip in 2020 and a subsequent recovery in 2021. The West Tier segment consistently exhibits higher asset efficiency compared to the East Tier throughout the analyzed period.
- East Tier Performance
- The asset turnover ratio decreased from 0.70 in 2019 to 0.55 in 2020, indicating a decline in the ability to generate revenue relative to the asset base. An upward correction occurred in 2021, with the ratio increasing to 0.65, although efficiency remained below the 2019 baseline.
- West Tier Performance
- Asset utilization declined from 0.85 in 2019 to 0.72 in 2020. Efficiency rebounded in 2021 to 0.82, representing a nearly full recovery to the pre-2020 performance level.
- Comparative Segment Analysis
- The West Tier segment maintained a superior asset turnover ratio over the East Tier in all recorded years. The uniformity of the trend—marked by a 2020 contraction and a 2021 expansion—suggests that both segments were influenced by similar macroeconomic or operational factors.
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Segment Asset Turnover: East Tier
Waste Management Inc.; East Tier; segment asset turnover calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Gross operating revenues | 9,278) | 7,873) | 8,098) | —) | —) |
| Total assets | 14,269) | 14,274) | 11,600) | —) | —) |
| Segment Activity Ratio | |||||
| Segment asset turnover1 | 0.65 | 0.55 | 0.70 | — | — |
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).
1 2021 Calculation
Segment asset turnover = Gross operating revenues ÷ Total assets
= 9,278 ÷ 14,269 = 0.65
The East Tier segment experienced fluctuations in asset utilization efficiency between 2019 and 2021, characterized by an initial decline followed by a partial recovery in the asset turnover ratio.
- Revenue and Asset Trends
- Gross operating revenues decreased from 8,098 million US dollars in 2019 to 7,873 million US dollars in 2020, before rising to 9,278 million US dollars in 2021. Concurrently, total assets grew significantly from 11,600 million US dollars in 2019 to 14,274 million US dollars in 2020, remaining virtually flat at 14,269 million US dollars in 2021.
- Asset Turnover Analysis
- The segment asset turnover ratio declined from 0.70 in 2019 to 0.55 in 2020. This deterioration was driven by a dual impact: a slight contraction in operating revenues coupled with a substantial increase in the asset base. The ratio subsequently recovered to 0.65 in 2021, a result of strong revenue growth while assets remained stable, indicating a more efficient conversion of the segment's asset base into gross operating revenues.
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Segment Asset Turnover: West Tier
Waste Management Inc.; West Tier; segment asset turnover calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Gross operating revenues | 9,369) | 8,241) | 8,289) | —) | —) |
| Total assets | 11,476) | 11,501) | 9,720) | —) | —) |
| Segment Activity Ratio | |||||
| Segment asset turnover1 | 0.82 | 0.72 | 0.85 | — | — |
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).
1 2021 Calculation
Segment asset turnover = Gross operating revenues ÷ Total assets
= 9,369 ÷ 11,476 = 0.82
The West Tier segment exhibited fluctuating asset efficiency between 2019 and 2021, characterized by an initial decline in turnover followed by a partial recovery.
- Gross Operating Revenues
- Operating revenues remained relatively stagnant between 2019 and 2020, moving from US$ 8,289 million to US$ 8,241 million. A significant upward trend followed in 2021, with revenues increasing to US$ 9,369 million, representing a substantial growth in top-line performance.
- Total Asset Base
- A sharp expansion of the asset base occurred in 2020, with total assets increasing from US$ 9,720 million to US$ 11,501 million. This asset level remained nearly constant through 2021, closing the period at US$ 11,476 million.
- Segment Asset Turnover
- The asset turnover ratio declined from 0.85 in 2019 to 0.72 in 2020, a result of asset growth outpacing revenue generation during that period. In 2021, the ratio recovered to 0.82, indicating that the segment successfully leveraged its expanded asset base to drive higher operating revenues, thereby improving overall asset productivity.
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Segment Capital Expenditures to Depreciation
Waste Management Inc., capital expenditures to depreciation by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 0.73 | 0.67 | 0.86 | — | — |
| West Tier | 0.66 | 0.63 | 0.90 | — | — |
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 analysis of capital expenditures relative to depreciation for the East Tier and West Tier segments reveals a consistent trend across both regions from 2019 to 2021. Both segments experienced a significant contraction in the ratio during 2020, followed by a modest increase in 2021, although neither returned to the levels observed in 2019.
- East Tier Segment
- The ratio was 0.86 in 2019, declined to 0.67 in 2020, and subsequently rose to 0.73 in 2021. This indicates a period of reduced capital investment relative to asset depreciation in 2020, with a partial recovery in the following year.
- West Tier Segment
- A similar trajectory is evident in the West Tier, where the ratio declined from 0.90 in 2019 to 0.63 in 2020, before recovering slightly to 0.66 in 2021. The volatility in this segment mirrors that of the East Tier, although the ratio remained lower than that of the East Tier by the end of 2021.
- Comparative Trend Analysis
- Throughout the observed period, both segments maintained ratios below 1.0, suggesting that capital expenditures were lower than depreciation charges. While the West Tier started with a higher ratio in 2019, it experienced a sharper decline and a more muted recovery compared to the East Tier.
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Segment Capital Expenditures to Depreciation: East Tier
Waste Management Inc.; East Tier; segment capital expenditures to depreciation calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Capital expenditures | 708) | 537) | 670) | —) | —) |
| Depreciation and amortization | 970) | 801) | 776) | —) | —) |
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | 0.73 | 0.67 | 0.86 | — | — |
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).
1 2021 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation and amortization
= 708 ÷ 970 = 0.73
The financial trajectory of the East Tier segment from 2019 to 2021 is characterized by a consistent increase in depreciation and amortization costs paired with fluctuating capital investment levels. The segment consistently maintained capital expenditures below its depreciation charges, indicating that the rate of asset replacement was lower than the accounting consumption of those assets.
- Capital Expenditure Trends
- Investment levels experienced volatility over the analyzed period. Capital expenditures decreased from US$ 670 million in 2019 to US$ 537 million in 2020, representing a notable contraction in spending. A recovery followed in 2021, with expenditures rising to US$ 708 million, the highest level recorded during this timeframe.
- Depreciation and Amortization Trends
- A steady upward trajectory is observed in depreciation and amortization expenses. Costs rose from US$ 776 million in 2019 to US$ 801 million in 2020, and further increased to US$ 970 million by 2021. This consistent growth suggests an expanding base of depreciable assets or the impact of new assets entering the depreciation cycle.
- Capital Expenditures to Depreciation Ratio
- The investment-to-depreciation ratio remained below 1.0 throughout the period, starting at 0.86 in 2019, dropping to 0.67 in 2020, and recovering slightly to 0.73 in 2021. The fact that the ratio stayed below unity indicates that the segment did not reinvest sufficient capital to fully offset the depreciation of its asset base, which may reflect a strategy of capital discipline or a period of asset maturity.
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Segment Capital Expenditures to Depreciation: West Tier
Waste Management Inc.; West Tier; segment capital expenditures to depreciation calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Capital expenditures | 579) | 465) | 620) | —) | —) |
| Depreciation and amortization | 883) | 738) | 687) | —) | —) |
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | 0.66 | 0.63 | 0.90 | — | — |
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).
1 2021 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation and amortization
= 579 ÷ 883 = 0.66
The West Tier segment demonstrates a consistent pattern of capital expenditures remaining below the level of depreciation and amortization over the three-year period ending December 31, 2021. This indicates a period of under-replacement of assets, where the investment in new capital assets is not offsetting the accounting consumption of existing assets.
- Capital Expenditure Trends
- Annual spending on capital expenditures experienced significant volatility, decreasing from 620 million US$ in 2019 to 465 million US$ in 2020, representing a contraction of approximately 25%. Although expenditures recovered to 579 million US$ in 2021, they remained below the 2019 baseline.
- Depreciation and Amortization Trajectory
- In contrast to capital spending, depreciation and amortization expenses showed a steady and uninterrupted increase, rising from 687 million US$ in 2019 to 883 million US$ in 2021. This upward trend suggests an expanding asset base from previous investment cycles or the progression of assets through their useful life cycles.
- Capital Expenditures to Depreciation Ratio
- The ratio reflects a marked decline from 0.90 in 2019 to 0.63 in 2020, before stabilizing slightly at 0.66 in 2021. The fact that the ratio remained below 1.0 throughout the period confirms that the segment did not reinvest enough to cover the depreciation of its assets. The sharp drop in 2020 indicates a strategic or operational reduction in capital allocation, while the marginal increase in 2021 suggests a slight return toward previous investment levels, though still significantly lower than 2019.
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Gross operating revenues
Waste Management Inc., gross operating revenues by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 9,278) | 7,873) | 8,098) | —) | —) |
| West Tier | 9,369) | 8,241) | 8,289) | —) | —) |
| Solid Waste | 18,647) | 16,114) | 16,387) | —) | —) |
| Other | 3,046) | 2,364) | 2,317) | —) | —) |
| Total | 21,693) | 18,478) | 18,704) | —) | —) |
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).
Total gross operating revenues experienced a marginal contraction of approximately 1.2% between 2019 and 2020, decreasing from $18,704 million to $18,478 million. This was followed by a substantial increase in 2021, where total revenues rose to $21,693 million, representing a growth rate of 17.4% over the previous year.
- Solid Waste Segment Analysis
- The Solid Waste segment, comprising the East and West Tiers, serves as the primary revenue driver. This aggregate segment saw a decline from $16,387 million in 2019 to $16,114 million in 2020, before rebounding strongly to $18,647 million in 2021. The East Tier grew by 17.8% and the West Tier by 13.7% between 2020 and 2021, indicating a synchronized recovery across geographic regions.
- Other Revenue Performance
- The Other segment displayed a consistent upward trajectory, avoiding the dip observed in the primary waste segments during 2020. Revenues in this category grew from $2,317 million in 2019 to $2,364 million in 2020, and subsequently surged to $3,046 million in 2021. This represents a growth rate of 28.8% in the final year, the highest percentage increase among all reported segments.
- Revenue Composition and Trends
- While the Solid Waste operations maintain the largest share of gross operating revenues, the Other segment's accelerated growth suggests an expanding contribution to the total revenue mix. The overall trend indicates a period of stability and slight decline in 2020, followed by an aggressive expansion of all revenue streams in 2021.
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Income from operations
Waste Management Inc., income from operations by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 2,037) | 1,672) | 1,847) | —) | —) |
| West Tier | 2,103) | 1,800) | 1,934) | —) | —) |
| Solid Waste | 4,140) | 3,472) | 3,781) | —) | —) |
| Other | 34) | (42) | (158) | —) | —) |
| Corporate and Other | (1,209) | (996) | (917) | —) | —) |
| Total | 2,965) | 2,434) | 2,706) | —) | —) |
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).
Total income from operations exhibited a V-shaped trend between 2019 and 2021. Following a decline from US$ 2,706 million in 2019 to US$ 2,434 million in 2020, there was a significant recovery in 2021, with total income reaching a three-year peak of US$ 2,965 million.
- Solid Waste Segment Performance
- The Solid Waste segment, which aggregates the results of the East and West Tiers, remains the primary contributor to operational income. Both tiers followed a synchronized pattern, experiencing a contraction in 2020 before expanding in 2021. The West Tier consistently maintained higher operating income than the East Tier across all reported years. By December 31, 2021, the combined Solid Waste operating income reached US$ 4,140 million, a substantial increase over the 2020 low of US$ 3,472 million.
- Other Segment Evolution
- A consistent improvement is observed in the Other segment. This area transitioned from a net operating loss of US$ 158 million in 2019 to a reduced loss of US$ 42 million in 2020, eventually achieving profitability with an operating income of US$ 34 million in 2021.
- Corporate and Other Costs
- In contrast to the operational segments, Corporate and Other expenses showed a steady increase. The negative impact on total income grew progressively from US$ 917 million in 2019 to US$ 1,209 million in 2021. This upward trend in corporate overhead suggests an increase in non-segmental costs that partially offset the growth observed in the core waste management tiers.
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Depreciation and amortization
Waste Management Inc., depreciation and amortization by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 970) | 801) | 776) | —) | —) |
| West Tier | 883) | 738) | 687) | —) | —) |
| Solid Waste | 1,853) | 1,539) | 1,463) | —) | —) |
| Other | 70) | 87) | 75) | —) | —) |
| Corporate and Other | 76) | 45) | 36) | —) | —) |
| Total | 1,999) | 1,671) | 1,574) | —) | —) |
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).
Total depreciation and amortization expenses exhibited a consistent upward trajectory between 2019 and 2021, increasing from 1,574 million to 1,999 million. This represents a cumulative growth of approximately 27% over the three-year period, with a more pronounced acceleration in expenses occurring between 2020 and 2021.
- Solid Waste Segment Performance
- The Solid Waste segment serves as the primary driver of total depreciation and amortization, accounting for the vast majority of the overall expenditure. Expenses within this segment rose from 1,463 million in 2019 to 1,853 million in 2021. The growth pattern remained steady, with an increase of 76 million in 2020, followed by a more significant jump of 314 million in 2021.
- Regional Tier Analysis
- The Solid Waste expenses are distributed across the East and West Tiers, both of which show parallel growth trends. The East Tier reported costs increasing from 776 million in 2019 to 970 million in 2021. Similarly, the West Tier increased from 687 million in 2019 to 883 million in 2021. The proportional distribution of expenses between the two regions remained relatively stable, though the East Tier consistently maintained a higher expense profile.
- Corporate and Ancillary Expenses
- Corporate and Other expenses experienced significant relative growth, increasing from 36 million in 2019 to 76 million in 2021, more than doubling over the period. In contrast, the Other segment showed volatility, increasing from 75 million in 2019 to 87 million in 2020, before declining to 70 million by the end of 2021.
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Capital expenditures
Waste Management Inc., capital expenditures by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 708) | 537) | 670) | —) | —) |
| West Tier | 579) | 465) | 620) | —) | —) |
| Solid Waste | 1,287) | 1,002) | 1,290) | —) | —) |
| Other | 181) | 75) | 118) | —) | —) |
| Corporate and Other | 571) | 508) | 407) | —) | —) |
| Total | 2,039) | 1,585) | 1,815) | —) | —) |
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).
Total capital expenditures exhibited a V-shaped trajectory between 2019 and 2021. A decline was observed in 2020, with total spending falling to 1,585 million US dollars from 1,815 million US dollars in 2019, followed by a substantial recovery in 2021, where expenditures reached a period high of 2,039 million US dollars.
- Solid Waste Segment Expenditure
- Capital investments within the Solid Waste segment, comprising the East and West Tiers, closely mirrored the aggregate company trend. Total spending for this segment decreased from 1,290 million US dollars in 2019 to 1,002 million US dollars in 2020, before rebounding to 1,287 million US dollars in 2021. The East Tier consistently maintained a higher level of investment compared to the West Tier, peaking at 708 million US dollars in 2021.
- Corporate and Other Investment Trends
- The Corporate and Other category diverged from the operational segments by demonstrating a consistent year-over-year increase. Expenditures rose from 407 million US dollars in 2019 to 508 million US dollars in 2020, and further climbed to 571 million US dollars by the end of 2021, suggesting a sustained growth in centralized capital allocation.
- Other Segment Volatility
- The Other segment exhibited the highest relative volatility. Following a reduction from 118 million US dollars in 2019 to 75 million US dollars in 2020, expenditures in this segment surged to 181 million US dollars in 2021, representing the highest spending level for this specific category within the observed timeframe.
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Total assets
Waste Management Inc., total assets by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| East Tier | 14,269) | 14,274) | 11,600) | —) | —) |
| West Tier | 11,476) | 11,501) | 9,720) | —) | —) |
| Solid Waste | 25,745) | 25,775) | 21,320) | —) | —) |
| Other | 1,275) | 2,064) | 1,648) | —) | —) |
| Corporate and Other | 2,372) | 1,810) | 5,042) | —) | —) |
| Total | 29,392) | 29,649) | 28,010) | —) | —) |
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).
Total assets experienced a period of moderate growth followed by relative stabilization between 2019 and 2021. The total asset base increased from 28,010 million USD in 2019 to a peak of 29,649 million USD in 2020, before contracting slightly to 29,392 million USD by the end of 2021.
- Solid Waste Segment Expansion
- The Solid Waste segment, which aggregates the East and West Tiers, serves as the primary driver of the company's asset base. Assets within this segment grew by approximately 20.9% from 2019 to 2020, rising from 21,320 million USD to 25,775 million USD. This growth was balanced across both geographical tiers: the East Tier increased from 11,600 million USD to 14,274 million USD, while the West Tier rose from 9,720 million USD to 11,501 million USD. Both tiers demonstrated near-static asset levels between 2020 and 2021.
- Corporate and Other Asset Volatility
- A significant reduction in assets was observed in the Corporate and Other category, which decreased from 5,042 million USD in 2019 to 1,810 million USD in 2020. While this segment saw a partial recovery to 2,372 million USD in 2021, the value remained substantially below the 2019 baseline.
- Other Segment Trends
- The Other segment showed a non-linear trend, with assets increasing from 1,648 million USD in 2019 to 2,064 million USD in 2020. However, this was followed by a decline to 1,275 million USD in 2021, marking a decrease of approximately 22.8% when compared to the initial 2019 figures.
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