Republic Services, Inc. Reports Third Quarter Results

            Republic Services, Inc. Reports Third Quarter Results

- Reports third quarter earnings of $0.42 per share, $0.47 per share as
adjusted

- Restructures field and corporate operations

- Updates 2012 financial guidance and provides preliminary 2013 outlook

PR Newswire

PHOENIX, Nov. 1, 2012

PHOENIX, Nov. 1, 2012 /PRNewswire/ --Republic Services, Inc. (NYSE: RSG)
today reported net income of $152.7 million, or $0.42 per diluted share, for
the three months ended September30, 2012, versus $193.5 million, or $0.52 per
diluted share, for the comparable 2011 period.

(Logo: http://photos.prnewswire.com/prnh/20100304/RSLOGO)

Republic's net income for the three months ended September30, 2012 and 2011
includes a number of charges and other expenses that impacted its results. A
detail of these charges and other expenses is contained in the Reconciliation
of Certain Non-GAAP Measures section of this document. Excluding these items,
net income for the three months ended September30, 2012 and 2011 would have
been $170.7 million, or $0.47 per diluted share, and $198.5 million, or $0.53
per diluted share, respectively.

Excluding certain charges and other expenses recorded during 2012 and 2011 as
described in the Reconciliation of Certain Non-GAAP Measures section of this
document, adjusted earnings before interest, taxes, depreciation, depletion,
amortization and accretion (adjusted EBITDA) for the three months ended
September30, 2012 would have been $572.5 million, or 28.0% as a percentage of
revenue, compared to $648.7 million, or 30.7% as a percentage of revenue, for
the comparable 2011 period.

Revenue for the three months ended September 30, 2012 decreased to $2,046.9
million compared to $2,116.2 million for the comparable 2011 period. This
decrease in revenue of 3.3% was made up of increases in core price of 1.0% and
acquisitions, net of divestitures of 0.2% that were more than offset by
decreases in fuel surcharges of 0.4%, volumes of 2.1% (0.5% of which is due to
one less workday) and recycling commodities pricing of 2.0%.

For the nine months ended September 30, 2012, net income was $444.8 million,
or $1.20 per diluted share, versus $398.2 million, or $1.05 per diluted share,
for the comparable 2011 period.

Republic's net income for the nine months ended September30, 2012 and 2011
includes a number of charges, other expenses and benefits that impacted its
results. A detail of these charges, other expenses and benefits is contained
in the Reconciliation of Certain Non-GAAP Measures section of this document.
Excluding these items, net income for the nine months ended September30, 2012
and 2011 would have been $530.0 million, or $1.44 per diluted share, and
$543.1 million, or $1.43 per diluted share, respectively.

Excluding certain charges and other expenses recorded during 2012 and 2011 as
described in the Reconciliation of Certain Non-GAAP Measures section of this
document, adjusted EBITDA for the nine months ended September30, 2012 would
have been $1,754.0 million, or 28.8% as a percentage of revenue, compared to
$1,898.7 million, or 30.8% as a percentage of revenue, for the comparable 2011
period.

Revenue for the nine months ended September 30, 2012 decreased to $6,089.9
million compared to $6,167.7 million for the comparable 2011 period. This
decrease in revenue of 1.3% was made up of increases in core price of 0.7% and
acquisitions, net of divestitures of 0.4% that were more than offset by
decreases in volumes of 1.1% and recycling commodities pricing of 1.3%. Fuel
surcharges were flat versus the comparable 2011 period.

Commenting on these results, Donald W. Slager, President and Chief Executive
Officer, said, "During the third quarter, we have seen improvement in our core
price driven by higher resets in our index-based markets. We expect to
maintain higher pricing through the end of the year and into 2013. In
addition, we had positive volume growth in the collection line of business."

Company Restructures Field and Corporate Operations

In October 2012, we restructured our field and corporate operations to create
a more efficient and competitive company. These changes include consolidating
our field regions from four to three and our areas from 28 to 20, relocating
office space, and reducing administrative staffing levels. We expect to
record expenses of approximately $30 million with respect to this
restructuring, approximately one-half of which will be incurred in the fourth
quarter of 2012. We expect this restructuring will reduce our selling,
general and administrative expenses by approximately $23 million annually.

Commenting on the restructuring, Mr. Slager said, "We implemented this
realignment to leverage our strong leadership team and organizational
capabilities to refine how we operate. We have not made any changes to the
span of control at our business units, keeping the appropriate leadership
focus and decision making closest to our customers."

Updated 2012 Financial Guidance and Preliminary 2013 Outlook

Republic is updating its full year 2012 earnings guidance and issuing
preliminary outlook for 2013.

  o2012 Adjusted Diluted Earnings per Share: Our previous adjusted diluted
    earnings per share guidance was $1.91 to $1.93. We now expect adjusted
    diluted earnings per share to be in a range of $1.85 to $1.87 due to lower
    commodity pricing, higher fuel expense, and a third quarter 2012
    environmental remediation charge, partially offset by a lower effective
    tax rate. Adjusted diluted earnings per share excludes a number of
    charges, other expenses and benefits, as described in the Reconciliation
    of Updated 2012 Financial Guidance section of this document. This
    guidance assumes an effective tax rate of approximately 33.5%.
  o2012 Adjusted Free Cash Flow: Our previous adjusted free cash flow
    guidance was approximately $775 million. We now expect 2012 adjusted free
    cash flow to be approximately $750 million primarily due to lower
    commodity pricing and higher fuel expense. Adjusted free cash flow
    consists of cash provided by operating activities, less property and
    equipment received, plus proceeds from the sales of property and
    equipment. Adjusted free cash flow guidance excludes merger and
    restructuring related expenditures, certain legacy tax settlement
    payments, cash tax benefit for debt extinguishment and cash paid related
    to negotiation and withdrawal costs - Central States, net of tax.
  o2013 Preliminary Outlook: We also are providing our preliminary outlook
    for 2013. We are midway through our 2013 budget process. Consistent with
    our prior practice, we will provide 2013 guidance in February 2013. Given
    current business conditions, adjusted diluted earnings per share is
    expected to be in a range of $1.90 to $1.92. This assumes a full year
    effective tax rate of approximately 38.0%. Adjusted diluted earnings per
    share excludes negotiation and withdrawal costs - Central States,
    restructuring expenses and (gain) loss on disposition of assets and
    impairments, net.

Company Declares Quarterly Dividend

Republic also announced that its Board of Directors declared a regular
quarterly dividend of $0.235 per share for stockholders of record on January
2, 2013. The dividend will be paid on January 16, 2013.

About Republic

Republic is an industry leader in the U.S. non-hazardous solid waste
industry. Through its subsidiaries, Republic's collection companies, transfer
stations, recycling centers and landfills focus on providing reliable
environmental services and solutions for commercial, industrial, municipal and
residential customers. Republic and its employees believe in protecting the
planet and applying common sense solutions to customers' waste and recycling
challenges.

Republic participates in investor presentations and conferences throughout the
year. Interested parties can find a schedule of these conferences at
republicservices.com by selecting "Calendar" on the investor relations page.
Audio and other presentations from earnings calls and investor conferences are
also available on the investor relations page of the website.

SUPPLEMENTAL UNAUDITED FINANCIAL INFORMATION
AND OPERATING DATA
REPUBLIC SERVICES, INC.
CONSOLIDATED BALANCE SHEETS
(in millions, except per share amounts)
                                                  September 30,  December 31,
                                                  2012           2011
                                                  (Unaudited)
ASSETS
Current assets:
Cash and cash equivalents                         $  74.0        $  66.3
Accounts receivable, less allowance for doubtful  854.2          825.8
accounts of $44.8 and $48.1, respectively
Prepaid expenses and other current assets         217.9          215.9
Deferred tax assets                               123.9          157.7
Total current assets                              1,270.0        1,265.7
Restricted cash and marketable securities         132.9          189.6
Property and equipment, net                       6,903.2        6,792.3
Goodwill                                          10,678.2       10,647.0
Other intangible assets, net                      371.9          409.6
Other assets                                      278.1          247.3
Total assets                                      $  19,634.3    $  19,551.5
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable                                  $  490.6       $  563.6
Notes payable and current maturities of long-term 44.4           34.8
debt
Deferred revenue                                  311.1          290.2
Accrued landfill and environmental costs, current 185.4          184.2
portion
Accrued interest                                  71.6           72.2
Other accrued liabilities                         596.1          752.5
Total current liabilities                         1,699.2        1,897.5
Long-term debt, net of current maturities         7,060.0        6,887.0
Accrued landfill and environmental costs, net of  1,419.6        1,396.5
current portion
Deferred income taxes and other long-term tax     1,165.3        1,161.1
liabilities
Self-insurance reserves, net of current portion   288.1          303.9
Other long-term liabilities                       260.5          222.1
Commitments and contingencies
Stockholders' equity:
Preferred stock, par value $0.01 per share; 50    —              —
shares authorized; none issued
Common stock, par value $0.01 per share; 750
shares authorized; 404.4 and 402.1
                                                  4.0            4.0
 issued including shares held in treasury,
respectively
Additional paid-in capital                        6,563.3        6,495.6
Retained earnings                                 2,361.3        2,164.7
Treasury stock, at cost (39.8 and 32.2 shares,    (1,169.6)      (961.5)
respectively)
Accumulated other comprehensive loss, net of tax  (19.8)         (21.5)
Total Republic Services, Inc. stockholders'       7,739.2        7,681.3
equity
Noncontrolling interests                          2.4            2.1
Total stockholders' equity                        7,741.6        7,683.4
Total liabilities and stockholders' equity        $  19,634.3    $  19,551.5

REPUBLIC SERVICES, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share data)
                     Three Months Ended September  Nine Months Ended September
                     30,                           30,
                     2012            2011          2012            2011
Revenue              $  2,046.9      $  2,116.2    $  6,089.9      $  6,167.7
Expenses:
Cost of operations   1,280.5         1,260.0       3,722.2         3,657.5
Depreciation,
amortization and     203.5           215.0         632.1           629.4
depletion
Accretion            19.7            19.4          59.1            58.6
Selling, general and 193.8           207.5         613.5           611.5
administrative
Negotiation and
withdrawal costs -   31.3            —             34.6            —
Central States
Loss (gain) on
disposition of       0.2             5.8           (3.4)           24.8
assets and
impairments, net
Operating income     317.9           408.5         1,031.8         1,185.9
Interest expense     (93.2)          (108.3)       (296.3)         (335.4
Loss on
extinguishment of    (2.3)           (6.0)         (112.6)         (207.3)
debt
Interest income      0.3             —             0.8             0.3
Other income, net    0.4             1.8           1.1             3.8
Income before income 223.1           296.0         624.8           647.3
taxes
Provision for income 70.3            102.4         179.7           249.4
taxes
Net income           152.8           193.6         445.1           397.9
Net (income) loss
attributable to      (0.1)           (0.1)         (0.3)           0.3
noncontrolling
interests
Net income
attributable to      $  152.7        $  193.5      $  444.8        $  398.2
Republic Services,
Inc.
Basic earnings per
share attributable
to Republic
Services,

 Inc.
stockholders:
Basic earnings per   $  0.42         $  0.52       $  1.21         $  1.05
share
Weighted average
common shares        365.4           373.2         368.1           377.9
outstanding
Diluted earnings per
share attributable
to Republic
Services,

 Inc.
stockholders:
Diluted earnings per $  0.42         $  0.52       $  1.20         $  1.05
share
Weighted average
common and common
equivalent           366.4           374.7         369.3           379.6

 shares
outstanding
Cash dividends per   $  0.235        $  0.220      $  0.675        $  0.620
common share

REPUBLIC SERVICES, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
                                               Nine Months Ended September 30,
                                               2012                2011
Cash provided by operating activities:
Net income                                     $    445.1          $   397.9
Adjustments to reconcile net income to cash
provided by operating activities:
Depreciation and amortization of property and  387.9               384.3
equipment
Landfill depletion and amortization            191.3               188.0
Amortization of intangible and other assets    52.9                57.1
Accretion                                      59.1                58.6
Non-cash interest expense - debt               10.5                20.9
Non-cash interest expense - other              35.7                37.2
Stock-based compensation                       17.2                16.4
Deferred tax benefit                           (36.0)              (18.9)
Provision for doubtful accounts, net of        20.8                10.9
adjustments
Excess income tax benefit from stock option    (1.6)               (2.4)
exercises
Asset impairments                              0.3                 45.9
Loss on extinguishment of debt                 112.6               207.3
Gain on disposition of assets, net             (13.6)              (34.8)
Withdrawal liability - Central States          30.7                —
Other non-cash items                           —                   (6.7)
Change in assets and liabilities, net of
effects from business acquisitions and
divestitures:
Accounts receivable                            (47.3)              (80.7)
Prepaid expenses and other assets              (19.2)              24.5
Accounts payable                               (37.2)              6.3
Restructuring and synergy related expenditures (68.1)              (2.9)
Capping, closure and post-closure expenditures (54.0)              (73.3)
Remediation expenditures                       (49.5)              (26.7)
Other liabilities                              19.1                77.9
Cash provided by operating activities          1,056.7             1,286.8
Cash used in investing activities:
Purchases of property and equipment            (707.4)             (696.1)
Proceeds from sales of property and equipment  24.5                23.4
Cash used in acquisitions, net of cash         (73.1)              (40.8)
acquired
Cash proceeds from divestitures, net of cash   9.6                 14.2
divested
Change in restricted cash and marketable       54.5                12.3
securities
Other                                          (0.3)               (2.2)
Cash used in investing activities              (692.2)             (689.2)
Cash used in financing activities:
Proceeds from notes payable and long-term debt 2,038.2             1,137.5
Proceeds from issuance of senior notes, net of 847.6               1,844.9
discount
Payments of notes payable and long-term debt   (2,799.3)           (2,827.6)
Premiums paid on extinguishment of debt        (25.8)              (89.6)
Fees paid to issue and retire senior notes and (16.9)              (58.8)
certain hedging relationships
Issuances of common stock                      49.3                35.6
Excess income tax benefit from stock option    1.6                 2.4
exercises
Purchases of common stock for treasury         (208.1)             (429.9)
Cash dividends paid                            (243.4)             (227.8)
Cash used in financing activities              (356.8)             (613.3)
Increase (decrease) in cash and cash           7.7                 (15.7)
equivalents
Cash and cash equivalents at beginning of      66.3                88.3
period
Cash and cash equivalents at end of period     $    74.0           $   72.6

You should read the following information in conjunction with our audited
consolidated financial statements and notes thereto appearing in our Annual
Report on Form 10-K as of and for the year ended December31, 2011. All
amounts below are in millions and as a percentage of our revenue, except per
share data.

REVENUE

The following table reflects our total revenue by line of business for the
three and nine months ended September30:

             Three Months Ended September 30,          Nine Months Ended September 30,
             2012                 2011                 2012                 2011
Collection:
Residential  $ 542.0     26.5  %  $ 538.3     25.4  %  $ 1,614.0   26.5  %  $ 1,601.6   26.0  %
Commercial   632.4       30.9     625.9       29.6     1,884.4     30.9     1,871.5     30.3
Industrial   395.9       19.3     397.5       18.8     1,154.7     19.0     1,141.7     18.5
Other        8.4         0.4      8.5         0.4      24.9        0.4      24.4        0.4
Total        1,578.7     77.1     1,570.2     74.2     4,678.0     76.8     4,639.2     75.2
collection
Transfer     247.7                258.8                721.4                750.9
Less:        (146.4)              (146.3)              (427.5)              (433.0)
Intercompany
Transfer,    101.3       5.0      112.5       5.3      293.9       4.8      317.9       5.2
net
Landfill     477.7                496.4                1,408.7              1,400.3
Less:        (218.2)              (219.8)              (650.0)              (636.1)
Intercompany
Landfill,    259.5       12.7     276.6       13.1     758.7       12.5     764.2       12.4
net
Sale of
recyclable   78.4        3.8      120.0       5.7      266.5       4.4      341.2       5.5
materials
Other        29.0        1.4      36.9        1.7      92.8        1.5      105.2       1.7
non-core
Other        107.4       5.2      156.9       7.4      359.3       5.9      446.4       7.2
Total        $ 2,046.9   100.0 %  $ 2,116.2   100.0 %  $ 6,089.9   100.0 %  $ 6,167.7   100.0 %
revenue

The following table reflects changes in our revenue for the three and nine
months ended September30:

                               Three Months Ended September  Nine Months Ended
                               30,                           September 30,
                               2012              2011        2012        2011
Core price                     1.0%              0.7%        0.7%        0.9%
Fuel surcharges                (0.4)             1.2         —           1.0
Total price                    0.6               1.9         0.7         1.9
Volume                         (2.1)             0.3         (1.1)       (0.5)
Recycling commodities          (2.0)             1.7         (1.3)       1.4
San Mateo and Toronto contract —                 (1.4)       —           (1.4)
losses
Total internal growth          (3.5)             2.5         (1.7)       1.4
Acquisitions / divestitures,   0.2               0.1         0.4         (0.1)
net
Total                          (3.3)%            2.6%        (1.3)%      1.3%

COST OF OPERATIONS

Cost of operations includes labor and related benefits, which consists of
salaries and wages, health and welfare benefits, incentive compensation and
payroll taxes. It also includes transfer and disposal costs representing
tipping fees paid to third party disposal facilities and transfer stations;
maintenance and repairs relating to our vehicles, equipment and containers,
including related labor and benefit costs; transportation and subcontractor
costs, which include costs for independent haulers who transport our waste to
disposal facilities and costs for local operators who provide waste handling
services associated with our national accounts in markets outside our standard
operating areas; fuel, which includes the direct cost of fuel used by our
vehicles, net of fuel credits; disposal franchise fees and taxes consisting of
landfill taxes, municipal franchise fees, host community fees and royalties;
landfill operating costs, which includes financial assurance, leachate
disposal and other landfill maintenance costs; risk management, which includes
casualty insurance premiums and claims; cost of goods sold, which includes
material costs paid to suppliers associated with recycling commodities; and
other, which includes expenses such as facility operating costs, equipment
rent and gains or losses on sale of assets used in our operations.

The following table summarizes the major components of our cost of operations
for the three and nine months ended September30:

               Three Months Ended September 30,       Nine Months Ended September 30,
               2012               2011                2012                2011
Labor and
related        $ 393.0    19.2 %  $ 387.7     18.3 %  $ 1,172.4   19.3 %  $ 1,148.4   18.6 %
benefits
Transfer and   159.3      7.8     166.9       7.9     460.3       7.6     483.2       7.8
disposal costs
Maintenance    175.1      8.5     166.0       7.8     511.7       8.4     471.4       7.6
and repairs
Transportation
and
               108.4      5.3     118.2       5.6     324.5       5.3     330.2       5.4
 subcontract
costs
Fuel           132.3      6.5     133.3       6.3     395.5       6.5     388.2       6.3
Franchise fees 102.6      5.0     103.7       4.9     302.2       4.9     296.2       4.8
and taxes
Landfill
operating      70.6       3.4     34.0        1.6     129.6       2.1     92.9        1.5
costs
Risk           44.3       2.2     39.9        1.9     132.0       2.2     129.9       2.1
management
Cost of goods  25.3       1.3     41.8        2.0     89.9        1.5     113.8       1.9
sold
Other          69.6       3.4     68.5        3.2     204.1       3.3     203.3       3.3
Total cost of  $ 1,280.5  62.6 %  $ 1,260.0   59.5 %  $ 3,722.2   61.1 %  $ 3,657.5   59.3 %
operations

The cost categories shown above may change from time to time and may not be
comparable to similarly titled categories used by other companies. As such,
you should take care when comparing our cost of operations by cost component
to that of other companies. Landfill operating costs for the three and nine
months ended September 30, 2012 include a charge of $37.1 million recorded in
response to conditions at a closed disposal facility in Missouri.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling, general and administrative expenses include salaries, health and
welfare benefits and incentive compensation for corporate and field general
management, field support functions, sales force, accounting and finance,
legal, management information systems and clerical and administrative
departments. Other expenses include rent and office costs, fees for
professional services provided by third parties, marketing, investor and
community relations, directors' and officers' insurance, general employee
relocation, travel, entertainment and bank charges, but excludes any such
amounts recorded as restructuring charges.

The following table provides the components of our selling, general and
administrative costs for the three and nine months ended September30:

               Three Months Ended September      Nine Months Ended September 30,
               30,
               2012             2011             2012              2011
Salaries       $ 120.5   5.9 %  $ 133.7   6.3 %  $ 408.3   6.7  %  $ 399.5   6.5 %
Provision for
doubtful       8.0       0.4    4.8       0.2    20.8      0.3     10.9      0.2
accounts
Other          65.3      3.2    69.0      3.3    184.4     3.1     201.1     3.2
Total selling,
general and    $ 193.8   9.5 %  $ 207.5   9.8 %  $ 613.5   10.1 %  $ 611.5   9.9 %
administrative
expenses

The cost categories shown above may change from time to time and may not be
comparable to similarly titled categories used by other companies. As such,
you should take care when comparing our selling, general and administrative
expenses by cost component to that of other companies.

RECONCILIATION OF CERTAIN NON-GAAP MEASURES

Earnings Before Interest, Taxes, Depreciation, Depletion, Amortization and
Accretion

The following table calculates earnings before interest, taxes, depreciation,
depletion, amortization and accretion (EBITDA), which is not a measure
determined in accordance with U.S. generally accepted accounting principles
(GAAP), for the three and nine months ended September30:

                     Three Months Ended September  Nine Months Ended September
                     30,                           30,
                     2012             2011         2012            2011
Net income
attributable to      $   152.7        $  193.5     $  444.8        $  398.2
Republic Services,
Inc.
Net income (loss)
attributable to      0.1              0.1          0.3             (0.3)
noncontrolling
interests
Provision for income 70.3             102.4        179.7           249.4
taxes
Other income, net    (0.4)            (1.8)        (1.1)           (3.8)
Interest income      (0.3)            —            (0.8)           (0.3)
Loss on
extinguishment of    2.3              6.0          112.6           207.3
debt
Interest expense     93.2             108.3        296.3           335.4
Depreciation,
amortization and     203.5            215.0        632.1           629.4
depletion
Accretion            19.7             19.4         59.1            58.6
EBITDA               $   541.1        $  642.9     $  1,723.0      $  1,873.9

We believe that presenting EBITDA is useful to investors because it provides
important information concerning our operating performance exclusive of
certain non-cash and other costs. EBITDA demonstrates our ability to execute
our financial strategy, which includes reinvesting in existing capital assets
to ensure a high level of customer service, investing in capital assets to
facilitate growth in our customer base and services provided, maintaining our
investment grade credit rating and minimizing debt, paying cash dividends,
repurchasing our common stock, and maintaining and improving our market
position through business optimization. This measure has limitations.
Although depreciation, depletion, amortization and accretion are considered
operating costs in accordance with GAAP, they represent the allocation of
non-cash costs generally associated with long-lived assets acquired or
constructed in prior years. Our definition of EBITDA may not be comparable to
similarly titled measures presented by other companies.

Adjusted Earnings

Reported diluted earnings per share were $0.42 and $1.20 for the three and
nine months ended September30, 2012 versus $0.52 and $1.05 for the comparable
2011 periods. During the three and nine months ended September30, 2012 and
2011, we recorded a number of charges, other expenses and net (gain) loss on
disposition of assets that impacted our EBITDA, pre-tax income, net income
attributable to Republic Services, Inc. (Net Income – Republic) and diluted
earnings per share. These items primarily consist of the following:

               Three Months Ended September 30, 2012   Three Months Ended September 30, 2011
                                   Net       Diluted                       Net       Diluted
                         Pre-tax   Income -  Earnings            Pre-tax   Income -  Earnings
               EBITDA    Income    Republic  per       EBITDA    Income    Republic  per
                                             Share                                   Share
As reported    $ 541.1   $ 223.1   $ 152.7   $  0.42   $ 642.9   $ 296.0   $ 193.5   $  0.52
Negotiation
and withdrawal
costs -        31.3      31.3      18.6      0.05      —         —         —         —

 Central
States
Loss on
extinguishment —         2.3       1.3       —         —         6.0       5.8       0.01
of debt
Loss (gain) on
disposition of
assets
               0.1       0.1       (1.9)     —         5.8       5.8       (0.8)     —
 and
impairments,
net
Adjusted       $ 572.5   $ 256.8   $ 170.7   $  0.47   $ 648.7   $ 307.8   $ 198.5   $  0.53

               Nine Months Ended September 30, 2012     Nine Months Ended September 30, 2011
                                     Net       Diluted                         Net       Diluted
                           Pre-tax   Income -  Earnings              Pre-tax   Income -  Earnings
               EBITDA      Income    Republic  per       EBITDA      Income    Republic  per
                                               Share                                     Share
As reported    $ 1,723.0   $ 624.8   $ 444.8   $  1.20   $ 1,873.9   $ 647.3   $ 398.2   $  1.05
Negotiation
and withdrawal
costs -        34.6        34.6      20.6      0.06      —           —         —         —

 Central
States
Loss on
extinguishment —           112.6     68.7      0.19      —           207.3     127.3     0.33
of debt
(Gain) loss on
disposition of
assets
               (3.6)       (3.6)     (4.1)     (0.01)    24.8        24.8      17.6      0.05
 and
impairments,
net
Adjusted       $ 1,754.0   $ 768.4   $ 530.0   $  1.44   $ 1,898.7   $ 879.4   $ 543.1   $  1.43

During the three and nine months ended September30, 2012, we incurred costs
related to the negotiation of certain collective bargaining agreements under
which we have obligations to contribute to the Central States, Southeast and
Southwest Areas Pension Fund (Central States). Additionally, during the three
months ended September 30, 2012, we recorded a charge to earnings of
approximately $31 million for our partial withdrawal from Central States.

We believe that presenting adjusted EBITDA, adjusted pre-tax income, adjusted
net income attributable to Republic Services, Inc., and adjusted diluted
earnings per share, which are not measures determined in accordance with GAAP,
provides an understanding of operational activities before the financial
impact of certain items. We use these measures, and believe investors will
find them helpful, in understanding the ongoing performance of our operations
separate from items that have a disproportionate impact on our results for a
particular period. We have incurred comparable charges and costs in prior
periods, and similar types of adjustments can reasonably be expected to be
recorded in future periods. Our definition of adjusted EBITDA, adjusted
pre-tax income, adjusted net income attributable to Republic Services Inc.,
and adjusted diluted earnings per share may not be comparable to similarly
titled measures presented by other companies.

Free Cash Flow

We define free cash flow, which is not a measure determined in accordance with
GAAP, as cash provided by operating activities less purchases of property and
equipment plus proceeds from sales of property and equipment as presented in
our consolidated statements of cash flows. The following table calculates our
free cash flow for the three and nine months ended September30:

                 Three Months Ended September 30,  Nine Months Ended September
                                                   30,
                 2012              2011            2012            2011
Cash provided by
operating        $   361.7         $   491.2       $  1,056.7      $  1,286.8
activities
Purchases of
property and     (244.9)           (214.4)         (707.4)         (696.1)
equipment
Proceeds from
sales of         3.1               7.1             24.5            23.4
property and
equipment
Free cash flow   $   119.9         $   283.9       $  373.8        $  614.1

The following table calculates our adjusted free cash flow, which is not a
measure determined in accordance with GAAP, for the nine months ended
September30:

                                                         2012        2011
Cash provided by operating activities                    $ 1,056.7   $ 1,286.8
Property and equipment received                          (673.7)     (601.8)
Proceeds from sales of property and equipment            24.5        23.4
Merger related expenditures, net of tax                  41.0        1.8
BFI risk management and Allied exchange of partnership   34.2        —
interest tax payments
Cash tax benefit for debt extinguishment                 (7.1)       (23.9)
Divestiture related tax payments                         1.8         15.0
Cash paid related to negotiation and withdrawal costs -  2.3         —
Central States, net of tax
Adjusted free cash flow                                  $ 479.7     $ 701.3

We believe that presenting adjusted free cash flow provides useful information
regarding our recurring cash provided by operating activities after certain
expenditures. It also demonstrates our ability to execute our financial
strategy and is a key metric we use to determine compensation. The
presentation of adjusted free cash flow has material limitations. Adjusted
free cash flow does not represent our cash flow available for discretionary
expenditures because it excludes certain expenditures that are required or to
which we have committed such as debt service requirements and dividend
payments. Our definition of adjusted free cash flow may not be comparable to
similarly titled measures presented by other companies.

Purchases of property and equipment as reflected on our consolidated
statements of cash flows and the free cash flow presented above represent
amounts paid during the period for such expenditures. A reconciliation of
property and equipment reflected on our consolidated statements of cash flows
to property and equipment received during the period is as follows for the
three and nine months ended September30:

                           Three Months Ended September 30,  Nine Months Ended
                                                             September 30,
                           2012              2011            2012      2011
Purchases of property and
equipment per the
unaudited                  $   244.9         $   214.4       $ 707.4   $ 696.1

 consolidated
statements of cash flows
Adjustments for property
and equipment received
during the
                           (29.2)            (0.2)           (33.7)    (94.3)
 prior period but paid
for in the following
period, net
Property and equipment     $   215.7         $   214.2       $ 673.7   $ 601.8
received during the period

The adjustments noted above do not affect our net change in cash and cash
equivalents as reflected in our consolidated statements of cash flows.

As of September30, 2012 and 2011, accounts receivable were $854.2 million and
$901.3 million, net of allowance for doubtful accounts of $44.8 million and
$46.1 million, resulting in days sales outstanding of approximately 38 (or 24
net of deferred revenue) and 39 (or 26 net of deferred revenue), respectively.

CASH DIVIDENDS

In July 2012, we paid a cash dividend of $80.4 million to stockholders of
record as of July2, 2012. As of September30, 2012, we recorded a dividend
payable of $85.7 million to stockholders of record as of October 1, 2012,
which was paid on October 15, 2012. In July 2012, our board of directors
approved an increase in the regular quarterly dividend of approximately 7%.
The quarterly dividend of $0.235 per share will be paid on January 16, 2013 to
stockholders of record as of January 2, 2013.

STOCK REPURCHASE PROGRAM

In August 2011, our board of directors approved a share repurchase program
pursuant to which we may repurchase up to $750.0 million of our outstanding
shares of common stock through December31, 2013. This authorization is in
addition to the $400.0 million repurchase program authorized in November
2010. From November 2010 to September 30, 2012, we repurchased 24.7million
shares of our stock for $708.3 million at a weighted average cost per share of
$28.65. During the three months ended September 30, 2012, we repurchased 1.3
million shares of our stock for $35.7 million at a weighted average cost per
share of $28.32.

As of September 30, 2012, we had 364.6 million shares of common stock issued
and outstanding.

RECONCILIATION OF UPDATED 2012 FINANCIAL GUIDANCE

Adjusted Diluted Earnings per Share

The following is a summary of anticipated adjusted diluted earnings per share
for the year ending December 31, 2012 which is not a measure determined in
accordance with GAAP:

                                                   (Anticipated)

                                                   Year Ending
                                                   December 31,

                                                   2012
Diluted earnings per share                         $ 1.58 - 1.60
Loss on extinguishment of debt                     0.19
Negotiation and withdrawal costs - Central States  0.06
Restructuring expenses                             0.03
Gain on disposition of assets and impairments, net (0.01)
Adjusted diluted earnings per share                $ 1.85 - 1.87

This adjusted diluted earnings per share guidance assumes an effective tax
rate of 33.5% for the year ending December 31, 2012.

We believe that the presentation of adjusted diluted earnings per share, which
excludes loss on extinguishment of debt, negotiation and withdrawal costs –
Central States, restructuring expenses and gain on disposition of assets and
impairments, net, provides an understanding of operational activities before
the financial impact of certain items. We use this measure, and believe
investors will find it helpful, in understanding the ongoing performance of
our operations separate from items that have a disproportionate impact on our
results for a particular period. We have incurred comparable charges and costs
in prior periods, and similar types of adjustments can reasonably be expected
to be recorded in future periods. Our definition of adjusted diluted earnings
per share may not be comparable to similarly titled measures presented by
other companies.

Adjusted Free Cash Flow

Our anticipated adjusted free cash flow for the year ending December 31, 2012,
which is not a measure determined in accordance with GAAP, is calculated as
follows:

                                                                 (Anticipated)

                                                                 Year Ending

                                                                 December 31,

                                                                 2012
Cash provided by operating activities                            $    1,489
Property and equipment received                                  (860)
Proceeds from sales of property and equipment                    30
Merger related expenditures, net of tax                          41
Restructuring expenditures, net of tax                           1
BFI risk management and Allied exchange of partnership interest  54
tax payments
Cash tax benefit for debt extinguishment                         (10)
Divestiture related tax payments                                 3
Cash paid related to negotiation and withdrawal costs - Central  2
States, net of tax
Adjusted free cash flow                                          $    750

We believe that presenting adjusted free cash flow provides useful information
regarding our recurring cash provided by operating activities after certain
expenditures. It also demonstrates our ability to execute our financial
strategy and is a key metric we use to determine compensation. The
presentation of adjusted free cash flow has material limitations. Adjusted
free cash flow does not represent our cash flow available for discretionary
expenditures because it excludes certain expenditures that are required or to
which we have committed such as debt service requirements and dividend
payments. Our definition of adjusted free cash flow may not be comparable to
similarly titled measures presented by other companies.

INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This document contains certain forward-looking information about us that is
intended to be covered by the safe harbor for "forward-looking statements"
provided by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are statements that are not historical facts.
Words such as "guidance," "expect," "will," "may," "anticipate," "plan,"
"estimate," "project," "intend," "should," "can," "likely," "could,"
"outlook," and similar expressions are intended to identify forward-looking
statements. These statements include statements about our plans, strategies
and prospects. Forward-looking statements are not guarantees of performance.
These statements are based upon the current beliefs and expectations of our
management and are subject to risks and uncertainties that could cause actual
results to differ materially from those expressed in, or implied or projected
by, the forward-looking information and statements. Although we believe that
the expectations reflected in the forward-looking statements are reasonable,
we cannot assure you that the expectations will prove to be correct. Among
the factors that could cause actual results to differ materially from the
expectations expressed in the forward-looking statements are:

  othe impact on us of our substantial indebtedness, including on our ability
    to obtain financing on acceptable terms to finance our operations and
    growth strategy and to operate within the limitations imposed by financing
    arrangements;
  ogeneral economic and market conditions, including the current global
    economic and financial market crisis, inflation and changes in commodity
    pricing, fuel, labor, risk and health insurance and other variable costs
    that are generally not within our control, and our exposure to credit and
    counterparty risk;
  owhether our estimates and assumptions concerning our selected balance
    sheet accounts, income tax accounts, final capping, closure, post-closure
    and remediation costs, available airspace, and projected costs and
    expenses related to our landfills and property and equipment (including
    our estimates of the fair values of the assets and liabilities acquired in
    our acquisition of Allied), and labor, fuel rates and economic and
    inflationary trends, turn out to be correct or appropriate;
  ocompetition and demand for services in the solid waste industry;
  oprice increases to our customers may not be adequate to offset the impact
    of increased costs, including labor, third-party disposal and fuel, and
    may cause us to lose volume;
  oour ability to manage growth and execute our growth strategy;
  oour compliance with, and future changes in, environmental and flow control
    regulations and our ability to obtain approvals from regulatory agencies
    in connection with operating and expanding our landfills;
  oour ability to retain our investment grade ratings for our debt;
  oour dependence on key personnel;
  oour dependence on large, long-term collection, transfer and disposal
    contracts;
  oour business is capital intensive and may consume cash in excess of cash
    flow from operations;
  oany exposure to environmental liabilities, to the extent not adequately
    covered by insurance, could result in substantial expenses;
  orisks associated with undisclosed liabilities of acquired businesses;
  orisks associated with pending and future legal proceedings, including
    litigation, audits or investigations brought by or before any governmental
    body;
  osevere weather conditions, which could impair our financial results by
    causing increased costs, loss of revenue, reduced operational efficiency
    or disruptions to our operations;
  ocompliance with existing and future legal and regulatory requirements,
    including limitations or bans on disposal of certain types of wastes or on
    the transportation of waste, which could limit our ability to conduct or
    grow our business, increase our costs to operate or require additional
    capital expenditures;
  opotential increases in our costs if we are required to provide additional
    funding to any multi-employer pension plan to which we contribute or if an
    additional withdrawal event or events occur with respect to Central States
    or if a withdrawal event occurs with respect to any other multi-employer
    pension plan to which we contribute;
  othe negative impact on our operations of union organizing campaigns, work
    stoppages or labor shortages;
  othe negative effect that trends toward requiring recycling, waste
    reduction at the source and prohibiting the disposal of certain types of
    wastes could have on volumes of waste going to landfills;
  ochanges by the Financial Accounting Standards Board or other accounting
    regulatory bodies to generally accepted accounting principles or policies;
    and
  oacts of war, riots or terrorism, including the events taking place in the
    Middle East and the continuing war on terrorism, as well as actions taken
    or to be taken by the United States or other governments as a result of
    further acts or threats of terrorism, and the impact of these acts on
    economic, financial and social conditions in the United States.

The risks included here are not exhaustive. Refer to "PartI, Item1A — Risk
Factors" in our Annual Report on Form 10-K for the year ended December31,
2011 for further discussion regarding our exposure to risks. Additionally,
new risk factors emerge from time to time and it is not possible for us to
predict all such risk factors, or to assess the impact such risk factors might
have on our business or the extent to which any factor or combination of
factors may cause actual results to differ materially from those contained in
any forward-looking statements. You should not place undue reliance on these
forward-looking statements, which speak only as of the date hereof. Except to
the extent required by applicable law or regulation, we undertake no
obligation to update or publish revised forward-looking statements to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.

SOURCE Republic Services, Inc.

Website: http://www.republicservices.com
Contact: Media Inquiries: Darcie Brossart, +1-480-718-6565, or Investor
Inquiries: Ed Lang +1-480-627-7128