Covanta Holding Corporation Reports 2012 Full Year and Fourth Quarter Results

Covanta Holding Corporation Reports 2012 Full Year and Fourth Quarter Results 
Signed $2.5 Billion in Contracts During 2012 With Average Term of 12
Years 
Projecting 5% Adjusted EBITDA Growth for 2013 
MORRISTOWN, NJ -- (Marketwire) -- 02/06/13 --  Covanta Holding
Corporation (NYSE: CVA) ("Covanta" or the "Company"), a leading
global owner and operator of Energy-from-Waste ("EfW") projects,
reported financial results today for the three and twelve months
ended December 31, 2012. 


 
                                                                            
                                                    Full Year               
                                     ---------------------------------------
                                                                   2012     
Continuing Operations                    2011        2012      Guidance(1)  
                                     ----------- ----------- ---------------
                                                                            
                                      (Unaudited, $ in millions, except per 
                                                  share amounts)            
Revenue                              $     1,650 $     1,644             N/A
Income from Continuing Operations    $        84 $       118             N/A
Adjusted EBITDA                      $       494 $       492 $   490 - $ 500
Free Cash Flow                       $       282 $       262 $   250 - $ 265
Adjusted EPS                         $      0.54 $      0.52 $ 0.50 - $ 0.55

 
(1) As of November 7, 2012. 
Key Full Year 2012 Highlights: 


 
--  Record year in terms of EfW Boiler availability;
--  Signed $2.5 billion of waste and energy contracts with average term of
    12 years -- secured two million tons of waste and 750,000 MWh of
    generation per year;
--  Acquired ~2,700 ton per day Delaware Valley EfW facility; immediately
    accretive to key metrics;
--  Successfully refinanced $1.9 billion in debt, creating substantial
    financial flexibility;
--  Honolulu EfW project expansion successfully commenced commercial
    operation; and
--  Doubled dividend to $0.60/share annually; shareholder returns totaled
    $169 million.

  
Commenting on Covanta's 2012 results, Anthony Orlando, Covanta's
President and CEO stated, "I'm pleased with both our 2012 operating
performance and the execution of organic growth initiatives. This
good work enabled us to offset the drop in energy and metals markets,
as well as the impact of Hurricane Sandy. We also had a great year
extending long-term waste and energy contracts. Our contracted
revenue base, combined with our continued investment in organic
growth initiatives, positions us to grow in the coming year. Our
guidance calls for 5% Adjusted EBITDA growth in 2013, and maintaining
our strong Free Cash Flow. Our focus is on investing in the business
for the long-term, and we see a number of exciting opportunities that
will allow us to grow this year and beyond."  
Full Year 2012 Results
 For the twelve months ended December 31,
2012, total operating revenues declined slightly to $1,644 million
from $1,650 million in 2011. This was primarily due to the negative
impacts of: 


 
--  Lower revenues earned explicitly to service project debt;
--  Lower pricing for energy at EfW facilities and recycled metals; and
--  Hurricane Sandy impact, as certain facilities were briefly forced
    off-line.

  
These impacts were substantially offset by: 


 
--  Organic growth initiatives in special waste, recycled metals and
    other;
--  Escalations in service fee contracts; and
--  New units coming online.

  
Excluding certain items(2), operating expenses were $1,420 million for
2012 compared to $1,427 million for 2011. The $7 million decrease was
primarily due to: 


 
--  The benefits from various operational improvements.

  
Offset by: 


 
--  Expenses related to Hurricane Sandy for repairs at facilities; and
--  Lower alternative fuel tax credits.

  
Excluding the items noted above, and the net operating income negative
effect of Hurricane Sandy of $9 million in 2012, operating income was
$233 million for the year ended December 31, 2012, or an increase of
$10 million compared to the prior year period. Operating income
improved due to: 


 
--  Organic growth initiatives; and
--  New units coming online.

  
Partially offset by: 


 
--  Lower debt service pass through revenue;
--  Lower pricing for EfW energy and recycled metal; and
--  Lower alternative fuel tax credits.

  
Adjusted EBITDA declined $2 million to $492 million primarily due to
lower debt service pass through revenue, lower EfW energy and lower
recycled metal pricing, lower alternative fuel tax credits, and the
impact of Hurricane Sandy, mostly offset by organic growth
initiatives, and new units coming online. 
Free Cash Flow was $262 million, down $20 million versus 2011. The
decline was primarily due to net effect of Hurricane Sandy, increased
maintenance capital expenditures and higher interest expense. 
Adjusted EPS of $0.52 declined by $0.02 compared to $0.54 in 2011,
due to a higher effective tax rate, increased interest expense and
the negative impact of Hurricane Sandy. These factors were partially
offset by higher pre-tax income, increased equity income, and a lower
number of shares outstanding due to the Company's stock buyback
program.  
(2) Includes pension plan settlement expense, net (gains) write-offs
and impact of adverse loss development and transition to run-off of
our insurance business. For additional information, see Exhibit 4A -
Note (a) - (f)  of this press release.  
Shareholder Returns and Liquidity
 In 2012, the Company doubled its
annual cash dividend to $0.60 per share and returned $169 million to
shareholders, consisting of $81 million in cash dividends and $88
million in share repurchases (3.9% of common stock outstanding).
Since the inception of its buyback program the Company has
repurchased 25.8 million shares, or 16.7% of shares outstanding, at a
weighted average cost of $16.00. As of December 31, 2012, Covanta had
$87 million of share repurchase authorization remaining. 
Sanjiv Khattri, Covanta's Chief Financial Officer, commented, "2012
was a solid year for us. We were very active in returning capital to
shareholders through our dividend and stock repurchase program. We
also took advantage of strong debt markets, financing over $1.9
billion of capital. We have a strong balance sheet with flexibility
and ample liquidity. As a result of the financing, as well as
increased depreciation associated with our Delaware Valley facility
acquisition, our 2013 net income and EPS will be negatively impacted
by higher interest expense and depreciation. Our other key financial
metrics, Adjusted EBITDA and Free Cash Flow, remain strong and we
have some nice growth prospects for 2013 and beyond."  
Fourth Quarter Results
 Operating revenues of $430 million were flat
with the prior year period. Significant factors included the positive
impacts of: 


 
--  Organic growth initiatives in special waste, recycled metals and
    other; and
--  Escalations in service fee contracts.

  
Negative impacts were: 


 
--  Hurricane Sandy as certain facilities were briefly forced off-line;
--  Lower revenu
es earned explicitly to service project debt;
--  Lower recycled metals pricing; and
--  Lower revenues from our insurance business.

  
Excluding the items noted above, operating expenses were $351 million
in 2012 compared to $345 million for 2011, an increase of $6 million.
Benefits from various operational improvements were more than offset
by the negative impact of Hurricane Sandy and normal cost
escalations. 
Excluding the items noted above and the net operating income effects
of Hurricane Sandy, operating income was $88 million for the year
ended December 31, 2012, or an increase of $3 million compared to the
prior year period. 
Adjusted EBITDA declined $4 million to $143 million in 2012,
primarily due to the negative impact of Hurricane Sandy, lower
recycled metals pricing, lower alternative fuel tax credits,
partially offset by the benefits of organic growth initiatives. 
Free Cash Flow of $57 million in 2012 declined $6 million versus 2011
primarily due to higher interest expense, which was partially offset
by the timing of other working capital. 
Adjusted EPS of $0.20 declined by $0.07 from the prior year period
due to a higher effective tax rate, increased interest expense and
the negative impact of Hurricane Sandy. These declines were partially
offset by a lower number of shares outstanding due to the Company's
common stock buyback program.  
2013 Guidance 
 The Company is establishing guidance for 2013 for the
following key metrics: 
(In millions, except per share amounts) 


 
                                                                            
----------------------------------------------------------------------------
                         2012               2013                            
Metric                   Actual        Guidance Range   % Change At Midpoint
----------------------------------------------------------------------------
Adjusted EBITDA          $ 492         $ 500 - $ 530            +5%         
----------------------------------------------------------------------------
Free Cash Flow           $ 262         $ 250 - $ 280            +1%         
----------------------------------------------------------------------------
Adjusted EPS             $ 0.52       $ 0.40 - $ 0.50           -13%        
----------------------------------------------------------------------------

 
Conference Call Information 
 Covanta will host a conference call at
8:30 am (Eastern) on Thursday, February 7, 2013 to discuss its fourth
quarter results. The conference call will begin with prepared
remarks, which will be followed by a question and answer session. To
participate, please dial 800-860-2442 approximately 10 minutes prior
to the scheduled start of the call. If calling from Canada, please
dial 866-605-3852. If calling outside of the United States and
Canada, please dial 412-858-4600. Please request the "Covanta Holding
Corporation call" when prompted by the conference call operator. The
conference call will also be webcast live from the Investor Relations
section of the Company's website. A presentation will be made
available during the call and will be found on the Investor Relations
section of the Covanta website at www.covantaenergy.com.  
A replay will be available one hour after the end of the conference
call through 9:00 AM (Eastern) Friday, February 15, 2013. To access
the replay, please dial 877-344-7529, or from outside of the United
States 412-317-0088 and use the replay conference ID number 10023855.
The webcast will also be archived on www.covantaenergy.com. 
10-K Filing Update 
 The Company expects its 2012 Annual Report on
Form 10-K to be filed the week of February 11, 2013. 
About Covanta
 Covanta Holding Corporation (NYSE: CVA) is an
internationally recognized owner and operator of large-scale
Energy-from-Waste and renewable energy projects and a recipient of
the Energy Innovator Award from the U.S. Department of Energy's
Office of Energy Efficiency and Renewable Energy. Covanta's 44
Energy-from-Waste facilities provide communities with an
environmentally sound solution to their solid waste disposal needs by
using that municipal solid waste to generate clean, renewable energy.
Annually, Covanta's modern Energy-from-Waste facilities safely and
securely convert approximately 20 million tons of waste into 9
million megawatt hours of clean renewable electricity and
approximately 9 billion pounds of steam that are sold to a variety of
industries. For more information, visit www.covantaenergy.com.  
Cautionary Note Regarding Forward-Looking Statements 
 Certain
statements in this press release may constitute "forward-looking"
statements as defined in Section 27A of the Securities Act of 1933
(the "Securities Act"), Section 21E of the Securities Exchange Act of
1934 (the "Exchange Act"), the Private Securities Litigation Reform
Act of 1995 (the "PSLRA") or in releases made by the Securities and
Exchange Commission ("SEC"), all as may be amended from time to time.
Such forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the actual
results, performance or achievements of Covanta Holding Corporation
and its subsidiaries ("Covanta") or industry results, to differ
materially from any future results, performance or achievements
expressed or implied by such forward-looking statements. Statements
that are not historical fact are forward-looking statements. For
additional information see the Cautionary Note Regarding
Forward-Looking Statements at the end of the Exhibits.   


 
                                                                            
                                                                            
                                                                  Exhibit 1 
Covanta Holding Corporation                                                 
Consolidated Statements of Income                                           
                                                                            
                                  Three Months Ended    Twelve Months Ended 
                                     December 31,          December 31,     
                                 --------------------  -------------------- 
                                    2012       2011       2012       2011   
                                 ---------  ---------  ---------  --------- 
                                                 (Unaudited)                
                                   (In millions, except per share amounts)  
Operating revenues                                                          
  Waste and service revenues     $     264  $     263  $   1,011  $   1,008 
  Recycled metals revenues              17         19         72         74 
  Electricity and steam sales           97         99        394        400 
  Other operating revenues              52         49        167        168 
                                 ---------  ---------  ---------  --------- 
    Total operating revenues           430        430      1,644      1,650 
                                 ---------  ---------  ---------  --------- 
Operating expenses                                                          
  Plant operating expenses             228        222        963        962 
  Other operating expenses (a)          56         36        156        138 
  General and administrative                                                
   expenses                             23         29         97        103 
  Depreciation and amortization                                             
   expense                              50         51        195        193 
  Net interest expense on                                                   
   project debt                          5          7         27         31 
  Net (gains) write-offs (b)           (44)         5        (46)         5 
                                 ---------  ---------  ---------  --------- 
    Total operating expenses           318        350      1,392      1,432 
                                 ---------  ---------  ---------  --------- 
Operating income                       
112         80        252        218 
                                 ---------  ---------  ---------  --------- 
Other income (expense)                                                      
  Investment income                      1         --          1          1 
  Interest expense                     (27)       (17)       (94)       (67)
  Non-cash convertible debt                                                 
   related expense                      (6)        (5)       (25)       (25)
  Loss on extinguishment of debt                                            
   (c)                                  (1)        --         (3)        (1)
  Other (expense) income, net                                               
   (d)                                  --         (6)         3        (19)
                                 ---------  ---------  ---------  --------- 
    Total other expenses               (33)       (28)      (118)      (111)
                                 ---------  ---------  ---------  --------- 
Income from continuing                                                      
 operations before income tax                                               
 expense and equity in net                                                  
 income from unconsolidated                                                 
 investments                            79         52        134        107 
Income tax benefit (expense) (d)         4        (25)       (26)       (28)
Equity in net income from                                                   
 unconsolidated investments             --          2         10          5 
                                 ---------  ---------  ---------  --------- 
Income from continuing                                                      
 operations                             83         29        118         84 
                                 ---------  ---------  ---------  --------- 
(Loss) income from discontinued                                             
 operations, net of income tax                                              
 expense of $0, $0, $1 and $3,                                              
 respectively                           --         (1)        (2)       143 
                                 ---------  ---------  ---------  --------- 
Net Income                              83         28        116        227 
                                 ---------  ---------  ---------  --------- 
Noncontrolling interests:                                                   
Less: Net income from continuing                                            
 operations attributable to                                                 
 noncontrolling interests in                                                
 subsidiaries                           (1)        (2)        (2)        (5)
Less: Net income from                                                       
 discontinued operations                                                    
 attributable to noncontrolling                                             
 interests in subsidiaries              --         --         --         (3)
                                 ---------  ---------  ---------  --------- 
Total net income attributable to                                            
 noncontrolling interests in                                                
 subsidiaries                           (1)        (2)        (2)        (8)
                                 ---------  ---------  ---------  --------- 
Net Income Attributable to                                                  
 Covanta Holding Corporation     $      82  $      26  $     114  $     219 
                                 =========  =========  =========  ========= 
                                                                            
                                                                            
                                                                            
Covanta Holding Corporation                                                 
Consolidated Statements of Income (continued)                               
                                                                            
                                  Three Months Ended    Twelve Months Ended 
                                     December 31,           December 31,    
                                 --------------------  ---------------------
                                    2012       2011       2012       2011   
                                 ---------- ---------  ---------  ----------
                                                 (Unaudited)                
                                   (In millions, except per share amounts)  
Amounts Attributable to Covanta                                             
 Holding Corporation                                                        
 stockholders:                                                              
  Continuing operations          $       82 $      27  $     116  $       79
  Discontinued operations                --        (1)        (2)        140
                                 ---------- ---------  ---------  ----------
Net Income Attributable to                                                  
 Covanta Holding Corporation     $       82 $      26  $     114  $      219
                                 ========== =========  =========  ==========
                                                                            
Earnings Per Share Attributable                                             
 to Covanta Holding Corporation                                             
 stockholders:                                                              
Basic                                                                       
  Continuing operations          $     0.63 $    0.20  $    0.88  $     0.56
  Discontinued operations                --     (0.01)     (0.01)       0.99
                                 ---------- ---------  ---------  ----------
  Covanta Holding Corporation    $     0.63 $    0.19  $    0.87  $     1.55
                                 ========== =========  =========  ==========
Weighted Average Shares                 130       136        132         141
                                 ========== =========  =========  ==========
                                                                            
Diluted                                                                     
  Continuing operations          $     0.62 $    0.20  $    0.87  $     0.56
  Discontinued operations                --     (0.01)     (0.01)       0.98
                                 ---------- ---------  ---------  ----------
  Covanta Holding Corporation    $     0.62 $    0.19  $    0.86  $     1.54
                                 ========== =========  =========  ==========
Weighted Average Shares                 132       137        133         142
                                 ========== =========  =========  ==========
                                                                            
Cash Dividend Declared Per                                                  
 Share:                          $     0.15 $   0.075  $    0.60  $     0.30
                                 ========== =========  =========  ==========
                                                                            
Supplemental Information - Non-                                             
 GAAP                                                                       
  Adjusted EPS (e)               $     0.20 $    0.27  $    0.52  $     0.54
                                                                            

 
                                                                            
(a) For additional information, see Exhibit 4A - Note (a) and (f) of this   
    Press Release.                                                          
(b) For additional information, see Exhibit 4A - Note (b) - (e) of this     
    Press Release.                                                          
(c) For additional information, see Exhibit 7A - Note (a) and (b) of this   
    Press Release.                                                          
(d) For additional information, see Exhibit 4A - Note (i) - (j) of this     
    Press Release.                                                          
(e) For additional information, see Exhibit 4 of this Press Release.        
                                                                            
                                                                            
                                                                            
                                                                 Exhibit 1A 
Covanta Holding Corporation                                                 
Consolidated Statements of Comprehensive Income                             
                                       
                                     
                                  Three Months Ended    Twelve Months Ended 
                                     December 31,          December 31,     
                                 --------------------  -------------------- 
                                    2012       2011       2012       2011   
                                 ---------  ---------  ---------  --------- 
                                          (Unaudited, in millions)          
                                                                            
Net income                       $      83  $      28  $     116  $     227 
                                 ---------  ---------  ---------  --------- 
  Foreign currency translation           3         11          1         -- 
  Adjustment for pension plan                                               
   settlement, net of tax                                                   
   expense (a)                           6         --          7         -- 
  Pension plan and                                                          
   postretirement plan                                                      
   unrecognized benefits, net of                                            
   tax benefit                          --         (8)        --         (8)
  Net unrealized gain (loss) on                                             
   derivative instruments, net                                              
   of tax benefit                       --          2         (2)         2 
  Net unrealized loss on                                                    
   available for sale                                                       
   securities, net of tax               (1)        --         --         -- 
                                 ---------  ---------  ---------  --------- 
Other comprehensive income                                                  
 (loss) attributable to Covanta                                             
 Holding Corporation                     8          5          6         (6)
                                 ---------  ---------  ---------  --------- 
Comprehensive income                    91         33        122        221 
                                 ---------  ---------  ---------  --------- 
Less:                                                                       
  Net income attributable to                                                
   noncontrolling interests in                                              
   subsidiaries                         (1)        (2)        (2)        (8)
  Foreign currency translation                                              
   attributable to                                                          
   noncontrolling interests in                                              
   subsidiaries                         --          1         --          2 
                                 ---------  ---------  ---------  --------- 
Comprehensive income                                                        
 attributable to noncontrolling                                             
 interests in subsidiaries              (1)        (1)        (2)        (6)
                                 ---------  ---------  ---------  --------- 
Comprehensive income                                                        
 attributable to Covanta Holding                                            
 Corporation                     $      90  $      32  $     120  $     215 
                                 =========  =========  =========  ========= 
                                                                            
                                                                            
(a) For additional information, see Exhibit 4A - Note (f) of this Press     
    Release.                                                                
                                                                            
                                                                            
                                                                            
                                                                  Exhibit 2 
Covanta Holding Corporation                                                 
Consolidated Balance Sheets                                                 
                                                                            
                                                      As of December 31,    
                                                   ------------------------ 
                                                       2012         2011    
                                                   -----------  ----------- 
                                                   (Unaudited)              
                                                   (In millions, except per 
                      ASSETS                            share amounts)      
Current:                                                                    
  Cash and cash equivalents                        $       246  $       232 
  Restricted funds held in trust                            53          101 
  Receivables (less allowances of $6 and $5,                                
   respectively)                                           256          260 
  Unbilled service receivables                              18           20 
  Deferred income taxes                                     18           28 
  Prepaid expenses and other current assets                 97          105 
  Assets held for sale                                      --           18 
                                                   -----------  ----------- 
Total Current Assets                                       688          764 
  Property, plant and equipment, net                     2,561        2,423 
  Investments in fixed maturities at market (cost:                          
   $36 and $31, respe
ctively)                               36           31 
  Restricted funds held in trust                           161           90 
  Unbilled service receivables                              17           25 
  Waste, service and energy contracts, net                 399          434 
  Other intangible assets, net                              23           78 
  Goodwill                                                 249          232 
  Investments in investees and joint ventures               49           43 
  Other assets                                             343          265 
                                                   -----------  ----------- 
Total Assets                                       $     4,526  $     4,385 
                                                   ===========  =========== 
              LIABILITIES AND EQUITY                                        
Current:                                                                    
  Current portion of long-term debt                $         3  $        32 
  Current portion of project debt                           80          147 
  Accounts payable                                          41           25 
  Deferred revenue                                          31           61 
  Accrued expenses and other current liabilities           205          211 
  Liabilities held for sale                                 --            3 
                                                   -----------  ----------- 
Total Current Liabilities                                  360          479 
  Long-term debt                                         2,012        1,454 
  Project debt                                             237          533 
  Deferred income taxes                                    691          633 
  Waste and service contracts                               35           76 
  Other liabilities                                        136          122 
                                         
          -----------  ----------- 
Total Liabilities                                        3,471        3,297 
                                                   -----------  ----------- 
Equity:                                                                     
Covanta Holding Corporation stockholders' equity:                           
  Preferred stock ($0.10 par value; authorized 10                           
   shares; none issued and outstanding)                     --           -- 
  Common stock ($0.10 par value; authorized 250                             
   shares; issued 159 and 158 shares; outstanding                           
   132 and 136 shares)                                      16           16 
  Additional paid-in capital                               806          824 
  Accumulated other comprehensive income                     7            1 
  Accumulated earnings                                     222          244 
  Treasury stock, at par                                    (3)          (2)
                                                   -----------  ----------- 
    Total Covanta Holding Corporation stockholders                          
     equity                                              1,048        1,083 
  Noncontrolling interests in subsidiaries                   7            5 
                                                   -----------  ----------- 
Total Equity                                             1,055        1,088 
                                                   -----------  ----------- 
Total Liabilities and Equity                       $     4,526  $     4,385 
                                                   ===========  =========== 
                                                                            
                                                                            
                                                                            
                                                                  Exhibit 3 
Covanta Holding Corporation                                                 
Consolidated Statements of Cash Flow                                        
                                                                            
                                                      Twelve Months Ended   
                                                         December 31,       
                                                   ------------------------ 
                                                       2012         2011    
                                                   -----------  ----------- 
                                                   (Unaudited, in millions) 
OPERATING ACTIVITIES:                                                       
Net income                                         $       116  $       227 
  Less: (Loss) income from discontinued                                     
   operations, net of tax expense                           (2)         143 
                                                   -----------  ----------- 
Income from continuing operations                          118           84 
Adjustments to reconcile net income from                                    
 continuing operations to net cash provided by                              
 operating activities from continuing operations:                           
  Depreciation and amortization expense                    195          193 
  Net (gains) write-offs (a)                               (46)           5 
  Loss on extinguishment of debt (b)                         3            1 
  Non-cash convertible debt related expense                 25           25 
  Stock-based compensation expense                          17           18 
  Deferred income taxes                                     15           30 
  Pension plan settlement expense (c)                       11           -- 
  Other, net                                                (3)          (1)
  Reversal of uncertain tax positions related to                            
   pre-emergence tax matters (d)                            --          (24)
  Contractual liability to pre-petition creditors                           
   (d)                                                      --           15 
  Change in restricted funds-other related to                               
   contractual liability to pre-petition creditors                          
   (d)                                                      --            5 
  Change in restricted funds held in trust                  34            4 
  Change in working capital, net of effects of                              
   acquisitions                                            (27)           5 
                                                   -----------  ----------- 
  Net cash provided by operating activities from                            
   continuing operations                                   342          360 
  Net cash provided by operating activities from                            
   discontinued operations                                  --            1 
                                                   -----------  ----------- 
Net cash provided by operating activities                  342          361 
                                                   -----------  ----------- 
INVESTING ACTIVITIES:                                                       
  Proceeds from assets sales                                --           12 
  Purchase of property, plant and equipment               (126)        (118)
  Acquisition of businesses, net of cash acquired          (94)         (10)
  Acquisition of land use rights                            (1)          (8)
  Property insurance proceeds                                8            1 
  Other, net                                               (11)         (13)
                                                   -----------  ----------- 
Net cash used in investing activities from                                  
 continuing operations                                    (224)        (136)
Net cash provided by investing activities from                              
 discontinued operations                                    11          243 
                                                   -----------  ----------- 
Net cash (used in) provided by investing                                    
 activities                                               (213)         107 
                                                   -----------  ----------- 
FINANCING ACTIVITIES:                                                       
  Proceeds from borrowing on long-term debt (b)          1,034           -- 
  Payment of deferred financing costs (b)                  (33)          -- 
  Principal payments on long-term debt (b)                (622)          (7)
  Principal payments on project debt                      (424)        (137)
  Convertible debenture repurchases                        (25)         (32)
  Payments of borrowings on revolving credit                                
   facility                                               (191)          -- 
  Proceeds from borrowings on revolving credit                              
   facility                                                251           -- 
  Proceeds from borrowings on project debt                  --           15 
  Change in restricted funds held in trust                  65           38 
  Cash dividends paid to stockholders                      (90)         (32)
  Common stock repurchased                                 (88)        (229)
  Financing of insurance premiums, net                     (10)          10 
  Payments to pre-petition creditors                        --          (12)
  Decrease in restricted funds to pre-petition                              
   creditors                                                --           12 
  Distributions to partners of noncontrolli
ng                               
   interests in subsidiaries                                (1)          (6)
  Other financing, net                                      19           (1)
                                                   -----------  ----------- 
Net cash used in financing activities from                                  
 continuing operations                                    (115)        (381)
Net cash (used in) provided by financing                                    
 activities from discontinued operations                    (2)           8 
                                                   -----------  ----------- 
Net cash used in financing activities                     (117)        (373)
                                                   -----------  ----------- 
Effect of exchange rate changes on cash and cash                            
 equivalents                                                --           (1)
                                                   -----------  ----------- 
Net increase in cash and cash equivalents                   12           94 
Cash and cash equivalents at beginning of period           234          140 
                                                   -----------  ----------- 
Cash and cash equivalents at end of period                 246          234 
Less: Cash and cash equivalents of discontinued                             
 operations at end of period                                --            2 
                                                   -----------  ----------- 
Cash and cash equivalents of continuing operations                          
 at end of period                                  $       246  $       232 
                                                   ===========  =========== 
                                                                            
                                                                            
(a) For additional information, see Exhibit 4A - Note (b) - (e) of this     
    Press Release.                                                          
(b) For additional information, see Exhibit 7A - Note (a) - (b) of this     
    Press Release.                                                          
(c) For additional information, see Exhibit 4A - Note (f) of this Press     
    Release.                                                                
(d) For additional information, see Exhibit 4A - Note (i) of this Press     
    Release.                                                                
                                                                            
                                                                            
                                                                            
                                                                   Exhibit 4
Covanta Holding Corporation                                                 
Reconciliation of Diluted Earnings Per Share to Adjusted EPS                
                                                                            
                           Three Months     Twelve Months                   
                              Ended             Ended                       
                           December 31,     December 31,                    
                        ----------------- ----------------                  
                                                                Full Year   
                          2012     2011     2012     2011    Estimated 2013 
                        -------  -------- -------  -------  ----------------
                                    (Unaudited)                             
Continuing Operations -                                                     
 Diluted Earnings Per                                                       
 Share                  $  0.62  $   0.20 $  0.87  $  0.56    $0.40 - $0.50 
Reconciling Items (a)     (0.42)     0.07   (0.35)   (0.02)         --      
                        -------  -------- -------  -------  ----------------
Adjusted EPS            $  0.20  $   0.27 $  0.52  $  0.54    $0.40 - $0.50 
                        =======  ======== =======  =======  ================
                                                                            
                                                                            
(a) For details related to the Reconciling Items, see Exhibit 4A of this    
    Press Release.                                                          
                                                                            
                                                                            
                                                                            
                                                                  Exhibit 4A
Covanta Holding Corporation                                                 
Reconciling Items                                                           
                                                                            
                                  Three Months Ended    Twelve Months Ended 
                                     December 31,          December 31,     
                                 --------------------  -------------------- 
                                    2012       2011       2012       2011   
                                 ---------  ---------  ---------  --------- 
                                                 (Unaudited)                
                                   (In millions, except per share amounts)  
Reconciling Items                                                           
Operating loss related to                                                   
 insurance subsidiaries (a)      $       1  $       1  $      10  $       2 
Write-off of intangible                                                     
 liability (b)                          --         --        (29)        -- 
Write-off of renewable fuels                                                
 project (c)                            --         --         16         -- 
Development costs (d)                   --          5         11          5 
Net gain related to lease                                                   
 termination (e)                       (44)        --        (44)        -- 
Gain on sales of business               --         (8)        --         (9)
Pension plan settlement expense                                             
 (f)                                    11         --         11         -- 
Loss on extinguishment of debt                                              
 (g)                                     1         --          3          1 
Effect on income of derivative                                              
 instruments not designated as                                              
 hedging instruments                    --         (2)        (1)        (2)
Effect of foreign exchange loss                                             
 (gain) on indebtedness (h)             --          6         (3)         4 
Contractual liability to pre-                                               
 petition creditors (i)                 --         --         --         15 
Other                                   (1)         1         --          1 
                                 ---------  ---------  ---------  --------- 
  Total Reconciling Items, pre-                                             
   tax                                 (32)         3        (26)        17 
Proforma income tax impact (j)         (24)         8        (22)         4 
Grantor trust activity                   1         --          1          1 
Reversal of uncertain tax                                                   
 positions related to pre-                                                  
 emergence tax matters (i)              --         --         --        (24)
                                 ---------  -
--------  ---------  --------- 
  Total Reconciling Items, net                                              
   of tax                        $     (55) $      11  $     (47) $      (2)
                                 =========  =========  =========  ========= 
                                                                            
Diluted (Loss) Earnings Per                                                 
 Share Impact                    $   (0.42) $    0.07  $   (0.35) $   (0.02)
                                 =========  =========  =========  ========= 
Weighted Average Diluted Shares                                             
 Outstanding                           132        137        133        142 
                                 =========  =========  =========  ========= 
                                                                            
                                                                            
(a) During the year ended December 31, 2012, we transitioned our remaining  
    insurance business to run-off and recorded additional losses and reserve
    increases of $7 million primarily relating to adverse loss development. 
(b) During the year ended December 31, 2012, our service contract for the   
    Essex EfW facility was amended and we recorded a non-cash write-off of  
    an intangible liability of $29 million related to the below-market      
    service contract which was recorded at fair value upon acquisition of   
    the facility.                                                           
(c) During the year ended December 31, 2012, we suspended the construction  
    of a facility that transformed waste materials into renewable liquid    
    fuels. We recorded a non-cash write-off of $16 million representing the 
    capitalized costs related to this project.                              
(d) During the year ended December 31, 2012, we recorded a non-cash write-  
    off of $11 million comprised of capitalized development costs related to
    a development project which we ceased to pursue in the United Kingdom.  
    During the year ended December 31, 2011, we recorded a non-cash write-  
    off of $5 million comprised of capitalized development costs and land   
    related to a development project which we ceased to pursue in the United
    Kingdom.                                                                
(e) During the year ended December 31, 2012, we recorded a net gain related 
    to the termination of the pre-existing lease in connection with the     
    acquisition of the Delaware Valley energy-from-waste facility.          
(f) During the three months ended December 31, 2012, we recorded a pension  
    settlement charge of $11 million.                                       
(g) For additional information, see Exhibit 7A - Note (a) - (b) of this     
    Press Release.                                                          
(h) During the year ended December 31, 2012 and 2011, we recorded a foreign 
    exchange (gain) loss related to intercompany loans, respectively.       
(i) For additional information, see Item 8. Financial Statements and        
    Supplementary Data - Note 16. Income Taxes of Covanta's Annual Report on
    Form 10-K for the year ended December 31, 2011.                         
      (i) The expiration of the statute of limitations in 2011 triggered a  
      contractual liability to pay restricted funds to third party claimants
      and resulted in other non-operating expense for the year ended        
      December 31, 2011 of $15 million with no related income tax benefit.  
      These payments related to tax liabilities set up in connection with   
      Covanta Energy's emergence from bankruptcy.                           
      (ii) For the year ended December 31, 2011, the income tax provision   
      includes a $24 million benefit due to the reversal of uncertain tax   
      positions, following the expiration of applicable statutes of         
      limitations related to pre-emergence tax matters in the Covanta Energy
      bankruptcy.                                                           
(j) We are presenting this proforma calculation of the income tax effect on 
    all reconciling items for each period to illustrate the proforma impact 
    on income tax expense and net income. The proforma income tax impact    
    represents the tax provision amount related to the overall tax provision
    calculated without the reconciling items when compared to the tax       
    provision reported under GAAP in the condensed consolidated statement of
    income.                                                                 
                                                                            
                                                                            
                                                                            
                                                                  Exhibit 4B
Covanta Holding Corporation                                                 
Effective Tax Rate "ETR"                                                    
                                                                            
                                  Three Months Ended    Twelve Months Ended 
                                     December 31,          December 31,     
                                ---------------------  -------------------- 
                                   2012        2011       2012       2011   
                                ---------   ---------  ---------  --------- 
                                                (Unaudited)                 
Effective Tax Rate (a)               (5.2)%      48.7%      19.3%      26.8%
                                                                            
                                                                            
(a) The ETR decrease during 2012 was primarily due to the impact of no tax  
    expense on the gain on settlement of the pre-existing lease recorded in 
    connection with the Delaware Valley energy-from-waste facility          
    acquisition (see Exhibit 4A - Note (e) above). In 2011, the ETR included
    the impact of the reversal of uncertain tax positions in 2011 (see      
    Exhibit 4A - Note (i) above). There is no tax benefit from the          
    contractual liability to pre-petition creditors and as a result, this   
    item had an impact on the effective tax rate in 2011.                   
                                                                            
                                                                            
                                                                            

 
                                                                   Exhibit 5
Covanta Holding Corporation                                                 
Reconciliation of Net Income to Adjusted EBITDA                             
                                                                            
                          Three Months      Twelve Months                   
                              Ended             Ended                       
                          December 31,      December 31,                    
                        ----------------  ----------------                  
                                                                Full Year   
                          2012     2011     2012     2011    Estimated 2013 
                        -------  -------  -------  -------  ----------------
                             (Unaudited, in millions)                       
Net Income from                                                             
 Continuing Operations                                                      
 Attributable to                                                            
 Covanta Holding                                                            
 Corporation            $    82  $ 
   27  $   116  $    79      $53 - $66   
                                                                            
Operating loss related                                                      
 to insurance                                                               
 subsidiaries (a)             1        1       10        2       (5) - 0    
                                                                            
Depreciation and                                                            
 amortization expense        50       51      195      193      220 - 210   
                                                                            
Debt service:                                                               
  Net interest expense                                                      
   on project debt            5        7       27       31                  
  Interest expense           27       17       94       67                  
  Non-cash convertible                                                      
   debt related expense       6        5       25       25                  
  Investment income          (1)      --       (1)      (1)                 
                        -------  -------  -------  -------                  
Subtotal debt service        37       29      145      122      171 - 155   
                                                                            
Income tax expense (b)       (4)      25       26       52       40 - 65    
                                                                            
Reversal of uncertain                                                       
 tax positions related                                                      
 to pre-emergence tax                                                       
 matters(b)                  --       --       --      (24)                 
                                                                            
Contractual liability                                                       
 to pre-petition                                                            
 creditors (b)               --       --       --       15                  
                                                                            
Write-off of intangible                                                     
 liability (c)               --       --      (29)      --                  
                                                                            
Write-off of renewable                                                      
 fuels project (d)           --       --       16       --                  
                                                                            
Development costs (e)        --        5       11        5                  
                                                                            
Net gain related to                                                         
 lease termination (f)      (44)      --      (44)      --                  
                                                                            
Pension plan settlement                                                     
 expense (g)                 11       --       11       --                  
                                                                            
Loss on extinguishment                                                      
 of debt (h)                  1       --        3        1                  
                                                                            
Gain on the sale of                                                         
 business                    --       (8)      --       (9)                 
                                                                            
Net income loss                                                             
 attributable to                                                            
 noncontrolling                                                             
 interests in                                                               
 subsidiaries                 1        2        2        5        3 - 8     
                                                                            
Other adjustments:                                                          
  Debt service billings                                                     
   in excess of revenue                                                     
   recognized                 3        1        9       22                  
  Non-cash compensation                                                     
   expense                    4        5       17       18                  
  Other non-cash items                                                      
   (i)                        1        9        4       13                  
                        -------  -------  -------  -------                  
Subtotal other                                                              
 adjustments                  8       15       30       53       18 - 26    
                        -------  -------  -------  -------                  
                                                                            
Total adjustments            61      120      376      415                  
                        -------  -------  -------  -------  ----------------
Adjusted EBITDA         $   143  $   147  $   492  $   494     $500 - $530  
                        =======  =======  =======  =======  ================
                                                                            
                                                                            
(a) For additional information, see Exhibit 4A - Note (a) of this Press     
    Release.                                                                
(b) Income tax expense for 2011 is adjusted for the reversal of uncertain   
    tax positions related to pre-emergence tax matters. For additional      
    information, see Exhibit 4A - Note (i) of this Press Release.           
(c) For additional information, see Exhibit 4A - Note (b) of this Press     
    Release.                                                                
(d) For additional information, see Exhibit 4A - Note (c) of this Press     
    Release.                                                                
(e) For additional information, see Exhibit 4A - Note (d) of this Press     
    Release.                                                                
(f) For additional information, see Exhibit 4A - Note (e) of this Press     
    Release.                                                                
(g) For additional information, see Exhibit 4A - Note (f) of this Press     
    Release.                                                                
(h) For additional information, see Exhibit 7A - Note (a) - (b) of this     
    Press Release.                                                          
(i) Includes certain non-cash items that are added back under the definition
    of Adjusted EBITDA in Covanta Energy Corporation's credit agreement.    
                                                                            
                                                                            
                                                                            
                                                                   Exhibit 6
Covanta Holding Corporation                                                 
Reconciliation of Cash Flow Provided by Operating Activities to Free Cash   
 Flow                                                                       
                                                                            
                          Three Months      Twelve Months                   
                             Ended             Ended                        
                          December 31,      December 31,                    
                        -------------
---  ----------------                  
                                                                Full Year   
                          2012     2011     2012     2011    Estimated 2013 
                        -------  -------  -------  -------  ----------------
                             (Unaudited, in millions)                       
Cash flow provided by                                                       
 operating activities                                                       
 from continuing                                                            
 operations             $    74  $    84  $   342  $   360     $325 - $360  
Plus: Cash flow used in                                                     
 (provided by)                                                              
 operating activities                                                       
 from insurance                                                             
 subsidiaries                 1       (2)       5        2       5 - 10     
Less: Maintenance                                                           
 capital expenditures                                                       
 (a)                        (18)     (19)     (85)     (80)    (80) - (90)  
                        -------  -------  -------  -------  ----------------
Free Cash Flow          $    57  $    63  $   262  $   282     $250 - $280  
                        =======  =======  =======  =======  ================
                                                                            
Weighted Average                                                            
 Diluted Shares                                                             
 Outstanding                132      137      133      142                  
                                                                            
Uses of Free Cash Flow                                                      
Investments:                                                                
  Acquisition of                                                            
   businesses, net of                                                       
   cash acquired        $   (94) $    --  $   (94) $   (10)                 
  Property insurance                                                        
   proceeds                   8        1        8        1                  
  Non-maintenance                                                           
   capital expenditures                                                     
   (b)                      (14)      (8)     (41)     (38)                 
  Acquisition of land                                                       
   use rights (b)            --       --       (1)      (8)                 
  Other growth                                                              
   investments (b)           (2)      --       (2)     (14)                 
  Other investing                                                           
   activities, net (c)       (6)       7       (9)       1                  
                        -------  -------  -------  -------                  
Total investments       $  (108) $    --  $  (139) $   (68)                 
                        -------  -------  -------  -------                  
                                                                            
Return of capital to                                                        
 stockholders:                                                              
  Cash dividends paid                                                       
   to stockholders      $   (39) $   (10) $   (90) $   (32)                 
  Common stock                                                              
   repurchased               (5)     (26)     (88)    (229)                 
                        -------  -------  -------  -------                  
Total return of capital                                                     
 to stockholders        $   (44) $   (36) $  (178) $  (261)                 
                        -------  -------  -------  -------                  
                                                                            
Capital raising                                                             
 activities:                                                                
  Net proceeds from                                                         
   issuance of                                                              
   corporate debt (d)   $   328  $    --  $ 1,001  $    --                  
  Net proceeds from                                                         
   issuance of project                                                      
   debt                      --       --       --       15                  
  Net proceeds from                                                         
   asset sales               --       12       --       12                  
  Other financing                                                           
   activities, net           16        2       19       (1)                 
                        -------  -------  -------  -------                  
Net proceeds from                                                           
 capital raising                                                            
 activities             $   344  $    14  $ 1,020  $    26                  
                        -------  -------  -------  -------                  
                                                                            
Debt repayments:                                                            
  Net cash used for                                                         
   scheduled principal                                                      
   payments on                                                              
   corporate debt       $    (1) $    (2) $   (26) $    (7)                 
  Net cash used for                                                         
   scheduled principal                                                      
   payments on project                                                      
   debt (e)                 (64)     (23)    (121)     (99)                 
  Optional repayment of                                                     
   corporate debt                                                           
   (f)(g)                    --       --     (621)     (32)                 
  Net cash used for                                                         
   optional repayment                                                       
   of project debt (h)     (238)      --     (238)      --                  
                        -------  -------  -------  -------                  
Total debt repayments   $  (303) $   (25) $(1,006) $  (138)                 
                        -------  -------  -------  -------                  
                                                                            
Borrowing activities -                                                      
 Revolving credit                                                           
 facility, net          $    40  $    --  $    60  $    --                  
                                                                            
Short-term borrowing                                                        
 activities - Financing                                                     
 of insurance premiums,                                                     
 net                    $    --  $    10  $   (10) $    10                  
                                                                            
Distributions to                                                            
 partners of                                                                
 noncontrolling                                                             
 interests in                          
                                     
 subsidiaries           $    --  $    (1) $    (1) $    (6)                 
                                                                            
Effect of exchange rate                                                     
 changes on cash and                                                        
 cash equivalents       $    (1) $     3  $    --  $     1                  
                        -------  -------  -------  -------                  
                                                                            
Net change in cash and                                                      
 cash equivalents from                                                      
 continuing operations  $   (15) $    28  $     8  $  (154)                 
                        =======  =======  =======  =======                  
                                                                            
                                                                            
(a) Purchases of property, plant and equipment are also referred to as      
    capital expenditures. Capital expenditures that primarily maintain      
    existing facilities are classified as maintenance capital expenditures. 
    The following table provides the components of total purchases of       
    property, plant and equipment:                                          
                                                                            
                          Three Months      Twelve Months  
                             Ended             Ended       
                          December 31,      December 31,   
                        ----------------  ---------------- 
                          2012     2011     2012     2011  
                        -------  -------  -------  ------- 
Maintenance capital                                        
 expenditures           $   (18) $   (19) $   (85) $   (80)
Capital expenditures                                       
 associated with                                           
 construction                --       (1)      --      (16)
Capital expenditures                                       
 associated with                                           
 technology development                                    
 and organic growth                                        
 initiatives                 (9)      (4)     (27)     (10)
Capital expenditures -                                     
 other                       (5)      (3)     (14)     (12)
                        -------  -------  -------  ------- 
Total purchases of                                         
 property, plant and                                       
 equipment              $   (32) $   (27) $  (126) $  (118)
                        =======  =======  =======  ======= 
                                                           
                                                                            
(b) Investments in our various growth opportunity areas, including organic  
    growth initiatives, technology, business development, and other similar 
    expenditures, excluding acquisitions of businesses. Non maintenance     
    capital expenditures also includes amounts associated with insurable    
    events. These expenditures are not considered growth investments. These 
    expenditures were $4 million and $1 million for the three months ended  
    December 31, 2012 and 2011, respectively, and $13 million and $1 million
    for the twelve months ended December 31, 2012 and 2011, respectively.   
                                                                            
(c) Other investing activities is primarily comprised of net payments from  
    the purchase/sale of investment securities and business development     
    expenses.                                                               
                                                                            
(d) For additional information, see Exhibit 7A - Note (a) of this Press     
    Release. Excludes borrowings under Revolving Credit Facility. Calculated
    as follows:                                                             
                                                                            
                                                           
                                                           
Proceeds from                                              
 borrowings on long-                                       
 term debt              $   335  $     -- $ 1,034  $     --
Less: Financing costs                                      
 related to issuance of                                    
 long-term debt              (7)       --     (33)       --
                        -------  -------- -------  --------
Net proceeds from                                          
 issuance of corporate                                     
 debt.                  $   328  $     -- $ 1,001  $     --
                        =======  ======== =======  ========
                                                                            
(e) Calculated as follows:                                                  
                                                           
Total scheduled                                            
 principal payments on                                     
 project debt           $  (100) $   (54) $  (146) $  (137)
Decrease in related                                        
 restricted funds held                                     
 in trust                    36       31       25       38 
                        -------  -------  -------  ------- 
Net cash used for                                          
 principal payments on                                     
 project debt           $   (64) $   (23) $  (121) $   (99)
                        =======  =======  =======  ======= 

 
                                                                            
(f) For additional information, see Exhibit 7A - Note (a) of this Press     
    Release. Calculated as follows:                                         
                                                           
                                                           
Redemption of Term Loan                                    
 due 2014               $     -- $     -- $  (619) $    -- 
Redemption of                                              
 Convertible Debentures                                    
 (g)                          --       --      (2)     (32)
                        -------- -------- -------  ------- 
Total optional                                             
 repayment of corporate                                    
 debt                   $     -- $     -- $  (621) $   (32)
                        ======== ======== =======  ======= 
                                                           
                                                           
                 
(g) As of December 31, 2011, there were $25 million aggregate principal     
    amount of the Debentures outstanding. On February 1, 2012, holders of   
    $23 million of outstanding Debentures exercised their option for us to  
    redeem the Debentures at par. The Debentures were also subject to       
    redemption at our option at any time on or after February 1, 2012, and  
    we subsequently redeemed the remaining $2 million of outstanding        
    Debentures on March 23, 2012.                                           
                                                                            
(h) Calculated as follows:                                                  
                                                           
                                                           
Total optional                                             
 principal payments on                                     
 project debt           $  (278) $     -- $  (278) $     --
Decrease in related                                        
 restricted funds held                                     
 in trust                    40        --      40        --
                        -------  -------- -------  --------
Net cash used for                                          
 optional repayment of                                     
 project debt           $  (238) $     -- $  (238) $     --
                        =======  ======== =======  ========
                                                           
                                                           
                                                           
                                                                   Exhibit 7
Covanta Holding Corporation                                                 
Capitalization Information                                                  
                                                                            
                                                       As of December 31,   
                                                   -------------------------
                                                       2012         2011    
                                                   ------------ ------------
                                                    (Unaudited, in millions)
Cash and Cash Equivalents:                                                  
Domestic                                           $         12 $         49
International                                               215          174
Insurance Subsidiary                                         19            9
                                                   ------------ ------------
Total Cash and Cash Equivalents                    $        246 $        232
                                                   ============ ============
                                                                            
Restricted Funds Held in Trust: (a)(b)                                      
  Debt Service - Principal                         $         72 $        113
  Debt Service - Interest                                     6            8
                                                   ------------ ------------
Debt Service Funds - Total                                   78          121
Revenue Funds                                                 9           16
Other Funds                                                 127           54
                                                   ------------ ------------
Total Restricted Funds Held in Trust               $        214 $        191
                                                   ============ ============
                                                                            
                                                                            
(a) Restricted funds held in trust are primarily amounts received by third- 
    party trustees relating to certain projects we own which may be used    
    only for specified purposes. We generally do not control these accounts.
    They primarily include debt service reserves for payment of principal   
    and interest on project debt. Revenue funds are comprised of deposits of
    revenues received with respect to projects prior to their disbursement. 
    Other funds are primarily amounts held in trust for operations,         
    maintenance, environmental obligations, operating lease reserves in     
    accordance with agreements with our clients and amounts held for future 
    scheduled distributions.                                                
(b) During the three months ended December 31, 2012, we completed a Project 
    Debt Refinancing. For additional information, see Exhibit 7A - Note (a) 
    of this Press Release.                                                  
                                                                            
                                                                            
                                                                            
                                                                  Exhibit 7A
                                                                            
                                   As of December 31,    As of December 31, 
                                          2012                  2011        
                                 --------------------- ---------------------
                                    Face       Book       Face       Book   
                                    Value      Value      Value      Value  
                                 ---------- ---------- ---------- ----------
                                           (Unaudited, in millions)         
Corporate Debt:                                                             
Revolving Credit Facility (a)    $       60 $       60 $       -- $       --
Term Loan due 2014 (a)                   --         --        619        619
New Term Loan due 2019 (a)              298        297         --         --
7.25% Senior Notes due 2020             400        400        400        400
6.375% Senior Notes due 2022 (a)        400        400         --         --
3.25% Cash Convertible Senior                                               
 Notes due 2014                         460        523        460        442
1.00% Senior Convertible                                                    
 Debentures due 2027 (b)                 --         --         25         25
                                 ---------- ---------- ---------- ----------
Sub-total                        $    1,618 $    1,680 $    1,504 $    1,486
                                 ---------- ---------- ---------- ----------
Tax-Exempt Bonds (a)                                                        
  4.875% Massachusetts Series                                               
   2012A due 2027                $       20 $       20 $       -- $       --
  4.875% Massachusetts Series                                               
   2012B due 2042                        67         67         --         --
  5.25% Massachusetts Series                                                
   2012C due 2042                        83         83         --         --
  5.25% Niagara Series 2012A due                                            
   2042                                 130        130         --         --
  4.00% Niagara Series 2012B due                                            
   2024                                  35         35         --         --
                                 ---------- ---------- ---------- ----------
Sub-total Tax-Exempt Bonds       $      335 $      335 $       -- $       --
                                 ---------- ---------- ---------- ----------
Total corporate debt (including                                             
 current portion)                $    1,953 $    2,015 $    1,504 $    1,486
                                 ---------- ---------- ---------- ----------
                                                                            
Project Debt:                                                               
Domestic project debt - service                                             
 fee facilities (a)              $      223 $      226 $      291 $      295
Domestic project debt - tip fee                                             
 facilities (a)                          68         68        355        359
International project debt               23         23         26         26
                                 ---------- ---------- ---------- ----------
Total project debt (including                                               
 current portion)                $      314 $      317 $      672 $      680
                                 ---------- ---------- ---------- ----------
                                                                            
Total Debt Outstanding         
  $    2,267 $    2,332 $    2,176 $    2,166
                                 ========== ========== ========== ==========
                                                                            
Net Debt (c)                     $    1,949            $    1,831           
                                 ==========            ==========           
                                                                            
Availability for Borrowings                                                 
 under the Revolving Credit                                                 
 Facility (a)                    $      584            $      300           
                                 ==========            ==========           
                                                                            
                                                                            
(a) During the first quarter of 2012, we completed a refinancing of our     
    previously existing senior secured credit facilities, issued by our     
    subsidiary, Covanta Energy, which consisted of a $300 million revolving 
    credit facility, a $320 million funded letter of credit facility and a  
    $619 million term loan, by entering into $1.2 billion in new senior     
    secured credit facilities (the "2012 Credit Facilities") issued by our  
    subsidiary, Covanta Energy, comprised of a $900 million revolving credit
    facility that expires in 2017 (the "Revolving Credit Facility") and a   
    $300 million term loan due 2019 (the "Term Loan"), and by issuing $400  
    million aggregate principal amount of 6.375% senior notes due 2022 (the 
    "6.375% Notes"). The proceeds from the Term Loan and a portion of the   
    proceeds from the 6.375% Notes were used to repay the previously        
    existing term loan, as well as to pay transaction expenses, while the   
    Revolving Credit Facility replaced the previously existing $300 million 
    revolving credit facility and $320 million funded letter of credit      
    facility. The Revolving Credit Facility is available for both the       
    issuance of letters of credit ($256 million outstanding as of December  
    31, 2012) and for cash borrowings for general corporate purposes ($60   
    million outstanding cash borrowings as of December 31, 2012). As a      
    result of the refinancing, we recognized a loss on extinguishment of    
    debt of approximately $2 million, pre-tax, which was comprised of the   
    write-off of deferred financing costs in connection with previously     
    existing financing arrangements. We incurred $26 million in offering    
    costs related to the refinancing which has been paid as of December 31, 
    2012.                                                                   
                                                                            
    In November 2012, we issued new tax-exempt corporate bonds totaling $335
    million. Proceeds from the offerings were utilized to refinance tax-    
    exempt project debt at our Haverhill, Niagara and SEMASS facilities, as 
    well as to fund certain capital expenditures in Massachusetts. As a     
    result of the refinancing, we recognized a loss on extinguishment of    
    debt of approximately $1 million, pre-tax, which was primarily comprised
    of the write-off of financing costs in connection with this transaction,
    offset by the write-off of unamortized premiums on previously existing  
    financing arrangements. We incurred $7 million in offering costs related
    to the refinancing which has been paid as of December 31, 2012.         
                                                                            
                                                                            
                                                    Corporate     Project   
                                                       Debt         Debt    
Debt Refinancing Details (Unaudited, in millions)  Refinancing  Refinancing 
                                                   -----------  ----------- 
Offering - 6.375% Senior Notes due 2022            $       400  $        -- 
New Term Loan due 2019                                     300           -- 
New Tax-Exempt Bonds                                        --          335 
Release of financing restricted funds                       --           40 
Offering Costs                                             (26)          (7)
                                                   -----------  ----------- 
Net Proceeds                                               674          368 
Redemption of Term Loan due 2014                          (619)          -- 
Redemption of Project Debt                                  --         (328)
                                                   -----------  ----------- 
Net Offering funds available for general corporate                          
 purposes                                          $        55  $        40 
                                                   ===========  =========== 
                                                                            
                                                                            
(b) As a result of the purchase of outstanding Debentures, we recorded a    
    loss on extinguishment of debt which is comprised of the difference     
    between the fair value and carrying value of the liability component of 
    the Debentures tendered, the write-off of deferred financing costs and  
    fees incurred in conjunction with the tender offer.                     
                                                                            
(c) Net Debt is calculated as total principal amount of debt outstanding    
    less cash and cash equivalents and debt service principal restricted    
    funds.                                                                  
                                                                            
                                                                            
                                                                            
                                                                   Exhibit 8
Covanta Holding Corporation                                                 
Return to Stockholders                                                      
(Unaudited, in millions, except per share amounts and percentages)          
                                                                            
During years ended December 31, 2010, 2011 and 2012, the following amounts  
were returned to stockholders:                                              
                                                                            
                                                      Weighted   % of Common
                                                       Average      Stock   
                                            Shares    Cost Per   Outstanding
                                 Amount  Repurchased    Share    Repurchased
                                -------- ----------- ---------- ------------
Common Stock Repurchased(a)                                                 
FY 2010                         $     95         6.1 $    15.56     3.9%    
                                -------- -----------                        
FY 2011                         $    230        14.4 $    15.99     9.6%    
                                -------- -----------                        
Q1 2012                         $     30         1.8 $    16.45     1.3%    
Q2 2012                               30         1.9 $    16.04     1.4%    
Q3 2012                               25         1.5 $    17.22     1.1%    
Q4 2012                                3         0.1 $    17.41     0.1%    
                                -------- -----------                        
FY 2012 sub-total:              $     88         5.3 $    16.55     3.9%    
                                -
------- -----------                        
Total Common Stock Repurchased  $    413        25.8 $    16.00     16.7%   
                                -------- -----------                        
                                                                            
Cash Dividends Declared to                                                  
 Stockholders                                                               
FY 2010                         $    233                                    
                                --------                                    
FY 2011                         $     42                                    
                                --------                                    
Q1 2012                         $     21                                    
Q2 2012                               20                                    
Q3 2012                               20                                    
Q4 2012 (b)                           20                                    
                                --------                                    
FY 2012 sub-total:              $     81                                    
                                --------                                    
Total Cash Dividends Declared                                               
 to Stockholders                $    356                                    
                                --------                                    
                                                                            
                                --------                                    
Total Return to Stockholders    $    769                                    
                                ========                                    
                                                                            
                                                                            
(a) As of December 31, 2012, the amount remaining under our currently       
    authorized share repurchase program was $87 million.                    
                                                                            
(b) On November 27, 2012, the Board of Directors authorized a quarterly cash
    dividend of $0.15 per share. The Q4 2012 payment was made on December   
    26, 2012 to stockholders of record as of the close of business on       
    December 18, 2012.                                                      
                                                                            
                                                                            
                                                                            
                                                                   Exhibit 9
Covanta Holding Corporation                                                 
Consolidated Reconciliation of Cash Flow Provided by Operating Activities to
 Adjusted EBITDA                                                            
                                                                            
                          Three Months      Twelve Months                   
                              Ended             Ended                       
                          December 31,      December 31,                    
                        ----------------  ----------------                  
                                                                Full Year   
                          2012     2011     2012     2011    Estimated 2013 
                        -------  -------  -------  -------  ----------------
                             (Unaudited, in millions)                       
Cash flow provided by                                                       
 operating activities                                                       
 from continuing                                                            
 operations             $    74  $    84  $   342  $   360     $325 - $360  
                                                                            
Cash flow used in                                                           
 operating activities                                                       
 from insurance                                                             
 activities (a)              (1)       2       (5)      (2)      5 - 10     
                                                                            
Debt service                 37       29      145      122      171 - 155   
                                                                            
Change in working                                                           
 capital                     79       72       27       (5)                 
Change in restricted                                                        
 funds held in trust        (44)     (39)     (34)      (4)                 
Non-cash convertible                                                        
 debt related expense        (6)      (5)     (25)     (25)                 
Equity in net income                                                        
 from unconsolidated                                                        
 investments                 --        2       10        5                  
Dividends from                                                              
 unconsolidated                                                             
 investments                 (1)      (3)      (8)      (8)                 
Current tax provision         4       18       11       (2)                 
Reversal of uncertain                                                       
 tax positions related                                                      
 to pre-emergence tax                                                       
 matters (b)                 --       --       --       24                  
Contractual liability                                                       
 to pre-petition                                                            
 creditors(b)                --      (15)      --      (15)                 
Change in restricted                                                        
 funds-other related to                                                     
 contractual liability                                                      
 to pre-petition                                                            
 creditors (b)               --       --       --       (5)                 
Other                         1        2       29       49                  
                        -------  -------  -------  -------  ----------------
  Sub-total                  33       32       10       14       (1) - 5    
                        -------  -------  -------  -------  ----------------
Adjusted EBITDA         $   143  $   147  $   492  $   494     $500 - $530  
                        =======  =======  =======  =======  ================
                                                                            
                                                                            
(a) For additional information, see Exhibit 4A - Note (a) of this Press     
    Release.                                                                
(b) For additional information, see Exhibit 4A - Note (i) of this Press     
    Release.                                                                
                                                                            
                                                                            
                                                                            
                                                                  Exhibit 10
Covanta Holding Corporation                                                 
Plant Operating Expenses Detail - Americas                                  
                                                                            
The Americas segment quarterly plant operating expenses typically differs   
substantially as a result of the timing of scheduled plant maintenance. We  
typically conduct scheduled maintenance periodically each year, which       
requires that individual boiler units temporarily cease operations. During  
these scheduled maintenance periods, we incur material repair and           
maintenance expenses and receive less revenue until the boiler and/or       
turbine units resume operations. This scheduled maintenance typically occurs
during periods of off-peak electric demand and/or lower waste volumes, which
are our first, second and fourth fiscal quarters. The first half of the year
scheduled maintenance period is typically the most extensive. The third     
quarter scheduled maintenance period is typically the least extensive. Given
these factors, we typically experience our lowest operating income from our 
projects during the first half of each year. The aggregate of all other     
components of plant operating expense is relatively consistent each quarter 
of the year.                                                                
                                                                            
                                   Three Months Ended   Twelve Months Ended 
                                      December 31,          December 31,    
                                 --------------------- ---------------------
                                    2012       2011       2012       2011   
                                 ---------- ---------- ---------- ----------
                                           (Unaudited, in millions)         
Plant Operating Expenses:                                                   
Plant maintenance (a)            $       47 $       44 $      226 $      231
All other                               172        171        705        703
                                 ---------- ---------- ---------- ----------
Plant operating expenses         $      219 $      215 $      931 $      934
                                 ========== ========== ========== ==========
                                                                            
                                                                            
(a) Plant maintenance costs include our internal maintenance team and non-  
    facility employee costs for facility scheduled and unscheduled          
    maintenance and repair expenses.                                        
                                                                            
                                                                            
                                                                            
                                                                 Exhibit 11A
Covanta Holding Corporation - Americas Segment                              
Statistics - (Unaudited, in millions, except percentages)                   
Boiler Availability                                                         
                                                         Twelve Months      
                                                       Ended December 31,   
                                                   -------------------------
                                                       2012         2011    
                                                   ------------ ------------
EfW Facilities                                            92.3%        91.7%
                                                                            
Waste and Service Revenue                                                   
                                                                            
                                                      Twelve Months Ended   
                                                          December 31,      
                                                   -------------------------
                                                       2012         2011    
                                                   ------------ ------------
Waste and service revenue unrelated to project                              
 debt                                              $        961 $        953
Revenue earned explicitly to service project debt                           
 - principal                                                 39           42
Revenue earned explicitly to service project debt                           
 - interest                                                   8           11
                                                   ------------ ------------
Total waste and service revenue                    $      1,008 $      1,006
                                                   ============ ============
                                                                            
                                                                            

 
Energy Revenue and Megawatt hours (MWh) At Market and Contracted by         
Facility Type                                                               
                                                                            
                                 Twelve Months Ended December 31,           
                       ---------------------------------------------------- 
                                  2012                       2011           
                       -------------------------  ------------------------- 
                                           % of                       % of  
                        Revenue  Volume   Total    Revenue  Volume   Total  
                          (a)    (a),(b)  Volume     (a)    (a),(b)  Volume 
                       -------- -------- -------  -------- -------- ------- 
EfW                                                                         
  At Market            $     36     0.83      15% $     79     1.30      23%
  Contracted & Hedged       270     3.96      71%      227     3.39      61%
                       -------- -------- -------  -------- -------- ------- 
Total EfW              $    306     4.79      86% $    306     4.69      84%
Biomass                                                                     
  At Market            $     13     0.37       7% $     12     0.25       5%
  Contracted                 48     0.36       7%       58     0.60      11%
                       -------- -------- -------  -------- -------- ------- 
Total Biomass          $     61     0.73      14% $     70     0.85      16%
                       -------- -------- -------  -------- -------- ------- 
Total                  $    367     5.52     100% $    376     5.54     100%
                       ======== ======== =======  ======== ======== ======= 
                                                                            
                                                                            
(a) Covanta share only                                                      
(b) Steam converted to MWh (0.7M MWh for both 2012 and 2011)                
                                                                            
                                                                            
                                                                            
Projected Energy Megawatt hours (MWh) At Market and Contracted by Facility  
Type (a)                                                                    
                                                                            
                                                             Full Year 2013E
                                                            As of January 1,
                                                                  2013      
                                                            ----------------
EfW                                                                         
  At Market                                                              1.0
  Contracted & Hedged    
                                                4.5
                                                            ----------------
Total EfW                                                                5.5
Biomass(b)                                                                  
  At Market                                                              0.3
  Contracted                                                             0.4
                                                            ----------------
Total Biomass                                                            0.7
                                                            ----------------
Total                                                                    6.2
                                                            ================
                                                                            
                                                                            
(a) Covanta share only                                                      
(b) Additional 0.4 million MWh of Biomass energy is economically dispatched,
    but available to run                                                    
                                                                            
                                                                            
                                                                            
                                                                 Exhibit 11B
Covanta Holding Corporation - Americas Segment                              
Statistics - (Unaudited, in millions, except percentages, metal tons (in    
thousands), and pricing data in Economic Drivers Section)                   
                                                                            
Recycled Metal Net Revenue by Type (a)                                      
                                                                            
                                                         Twelve Months      
                                                       Ended December 31,   
                                                   -------------------------
                                                       2012         2011    
                                                   ------------ ------------
Ferrous Metal                                      $         58 $         60
Non-Ferrous Metal                                            14           14
                                                   ------------ ------------
Total                                              $         72 $         74
                                                   ============ ============
                                                                            
(a) Covanta share only                                                      
                                                                            
                                                                            
                                                                            
Recycled Metal Net Tons Recovered by Type (a),(b)                           
                                                                            
                                                         Twelve Months      
                                                       Ended December 31,   
                                                   -------------------------
                                                       2012         2011    
                                                   ------------ ------------
Ferrous Metal                                             309.0        312.0
Non-Ferrous Metal                                          14.7         14.0
                                                   ------------ ------------
Total                                                     323.7        326.0
                                                   ============ ============
                                                                            
(a) Net volume: Covanta share only                                          
(b) Tons in thousands                                                       
                                                                            
                                                                            
                                                                            
Recycled Metal Gross Tons Recovered by Type (a),(b)                         
                                                                            
                                                         Twelve Months      
                                                       Ended December 31,   
                                                   -------------------------
                                                       2012         2011    
                                                   ------------ ------------
Ferrous Metal                                             415.0        414.0
Non-Ferrous Metal                                          16.8         15.9
                                                   ------------ ------------
Total                                                     431.8        429.9
                                                   ============ ============
                                                                            
(a) Gross volume: Both Covanta and client share                             
(b) Tons in thousands                                                       
                                                                            
                                                                            
                                                                            
Published Industry U.S. Economic Drivers (a)                                
                                                                            
                                                      As of December 31,    
                                                   ------------------------ 
                                                       2012         2011    
                                                   -----------  ----------- 
Consumer Price Index (b)                                   1.7%         3.0%
PJM Pricing (Electricity)(c)                       $     34.76  $     48.31 
Henry Hub Pricing (Natural Gas) (d)                $      2.75  $      4.04 
#1 HMS Pricing (Ferrous Metals) (e)                $       368  $       410 
Scrap Metals - Old Sheet & Old Cast (f)            $      0.72  $      0.77 
                                                                            
                                                                            
(a) While these drivers impact our business, there is not an exact          
    correlation between our results and changes in these metrics.           
(b) Represents the year-over-year percent change in the Headline CPI number.
    The Consumer Price Index (CPI-U) data is provided by the U.S. Department
    of Labor Bureau of Labor Statistics.                                    
(c) Average price per MWh for full year 2012 and 2011. Pricing for the PJM  
    PSEG Zone is provided by the PJM ISO.                                   
(d) Average price per MMBtu for full year 2012 and 2011. The Henry Hub      
    Pricing data is provided by the Natural Gas Weekly Update, Energy       
    Information Administration, Washington, DC. Nebraska Energy Office,     
    Lincoln, NE.                                                            
(e) Average price per gross ton for full year 2012 and 2011. The #1 Heavy   
    Melt Steel (HMS) composite index ($/gross ton) price is published by    
    American Metal Market.                                                  
(f) Average price per pound for full year 2012 and 2011. Calculated using   
    high and low prices for Old Sheet & Old Cast Scrap Metals ($/lb)        
    published by American Metal Market.                                     

 
Discussion of Non-GAAP Financial Measures
 We use a number of
different financial measures, both United States generally accepted
accounting principles ("GAAP") and non-GAAP, in assessing the overall
performance of our business. To supplement our assessment of results
prepared in accordance with GAAP, we use the measures of Adjusted
EBITDA, Free Cash Flow, and Adjusted EPS, which are non-GAAP measures
as defined by the Securities and Exchange Commission. The non-GAAP
financial measures of Adjusted EBITDA, Free Cash Flow, and Adjusted
EPS as described below, and used in the tables above, are not
intended as a substitute or as an alternative to net income, cash
flow provided by operating activities or diluted earnings per share
as indicators of our performance or liquidity or any other measures
of performance or liquidity derived in accordance with GAAP. In
addition, our non-GAAP financial measures may be different from
non-GAAP measures used by other companies, limiting their usefulness
for comparison purposes.  
The presentations of Adjusted EBITDA, Free Cash Flow and Adjusted EPS
are intended to enhance the usefulness of our financial information
by providing measures which management internally use to assess and
evaluate the overall performance of its business and those of
possible acquisition candidates, and highlight trends in the overall
business. 
Adjusted EBITDA
 We use Adjusted EBITDA to provide
further information that is useful to an understanding of the
financial covenants contained in the credit facilities as of December
31, 2012 of our most significant subsidiary, Covanta Energy, through
which we conduct our core waste and energy services business, and as
additional ways of viewing aspects of its operations that, when
viewed with the GAAP results and the accompanying reconciliations to
corresponding GAAP financial measures, provide a more complete
understanding of our core business. The calculation of Adjusted
EBITDA is based on the definition in Covanta Energy's credit
facilities as of December 31, 2012, which we have guaranteed.
Adjusted EBITDA is defined as earnings before interest, taxes,
depreciation and amortization, as adjusted for additional items
subtracted from or added to net income. Because our business is
substantially comprised of that of Covanta Energy, our financial
performance is substantially similar to that of Covanta Energy. For
this reason, and in order to avoid use of multiple financial measures
which are not all from the same entity, the calculation of Adjusted
EBITDA and other financial measures presented herein are ours,
measured on a consolidated basis for continuing operations, less the
results of operations of our insurance subsidiaries.  
Under the credit facilities as of December 31, 2012, Covanta Energy
is required to satisfy certain financial covenants, including certain
ratios of which Adjusted EBITDA is an important component. Compliance
with such financial covenants is expected to be the principal
limiting factor which will affect our ability to engage in a broad
range of activities in furtherance of our business, including making
certain investments, acquiring businesses and incurring additional
debt. Covanta Energy was in compliance with these covenants as of
December 31, 2012. Failure to comply with such financial covenants
could result in a default under these credit facilities, which
default would have a material adverse affect on our financial
condition and liquidity.  
These financial covenants are measured on a trailing four quarter
period basis and the material covenants are as follows:  


 
--  maximum Covanta Energy leverage ratio of 4.00 to 1.00, which measures
    Covanta Energy's Consolidated Adjusted Debt (which is the principal
    amount of its consolidated debt less certain restricted funds
    dedicated to repayment of project debt principal and construction
    costs) to its Adjusted EBITDA (which for purposes of calculating the
    leverage ratio and interest coverage ratio, is adjusted on a pro forma
    basis for acquisitions and dispositions made during the relevant
    period); and
    
    
--  minimum Covanta Energy interest coverage ratio of 3.00 to 1.00, which
    measures Covanta Energy's Adjusted EBITDA to its consolidated interest
    expense plus certain interest expense of ours, to the extent paid by
    Covanta Energy.

  
In order to provide a meaningful basis for comparison, we are providing
information with respect to our Adjusted EBITDA for the three and
twelve months ended December 31, 2012 and 2011, reconciled for each
such periods to net income from continuing operations and cash flow
provided by operating activities from continuing operations, which
are believed to be the most directly comparable measures under GAAP.  
Free Cash Flow
 Free Cash Flow is defined as cash flow provided by
operating activities from continuing operations, excluding the cash
flow provided by or used in our insurance subsidiaries, less
maintenance capital expenditures, which are capital expenditures
primarily to maintain our existing facilities. We use the non-GAAP
measure of Free Cash Flow as a criterion of liquidity and
performance-based components of employee compensation. We use Free
Cash Flow as a measure of liquidity to determine amounts we can
reinvest in our core businesses, such as amounts available to make
acquisitions, invest in construction of new projects, make principal
payments on debt, or amounts we can return to our stockholders
through dividends and/or stock repurchases.  
In order to provide a meaningful basis for comparison, we are
providing information with respect to our Free Cash Flow for the
three and twelve months ended December 31, 2012 and 2011, reconciled
for each such periods to cash flow provided by operating activities
from continuing operations, which we believe to be the most directly
comparable measure under GAAP.  
Adjusted EPS 
 Adjusted EPS excludes certain income and expense items
that are not representative of our ongoing business and operations,
which are included in the calculation of Diluted Earnings Per Share
in accordance with GAAP. The following items are not all-inclusive,
but are examples of reconciling items in prior comparative and future
periods. They would include the results of operations of our
insurance subsidiaries, write-off of assets and liabilities, the
effect of derivative instruments not designated as hedging
instruments, significant gains or losses from the disposition or
restructuring of businesses, gains and losses on assets held for
sale, transaction-related costs, income and loss on the
extinguishment of debt and other significant items that would not be
representative of our ongoing business.  
We will use the non-GAAP measure of Adjusted EPS to enhance the
usefulness of our financial information by providing a measure which
management internally uses to assess and evaluate the overall
performance and highlight trends in the ongoing business.  
In order to provide a meaningful basis for comparison, we are
providing information with respect to our Adjusted EPS for the three
and twelve months ended December 31, 2012 and 2011, reconciled for
each such periods to diluted earnings per share from continuing
operations, which is believed to be the most directly comparable
measure under GAAP.  
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
 Certain
statements in this Annual Report on Form 10-K may constitute
"forward-looking" statements as defined in Section 27A of the
Securities Act of 1933 (the "Securities Act"), Section 21E of the
Securities Exchange Act of 1934 (the "Exchange Act"), the Private
Securities Litigation Reform Act of 1995 (the "PSLRA") or in releases
made by the Securities and Exchange Commission ("SEC"), all as may be
amended from time to time. Such forward-looking statements involve
known and unknown risks, uncertainties and other important factors
that could cause the actual results, performance or achievements of
Covanta Holding Corporation and its subsidiaries ("Covanta") or
industry results, to differ materially from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Statements that are not historical fact
are forward-looking statements. Forward-looking statements can be
identified by, among other things, the use of forward-looking
language, such as the words "plan," "believe," "expect,"
"anticipate," "intend," "estimate," "project," "may," "will,"
"would," "could," "should," "seeks," or "scheduled to," or other
similar words, or the negative of these terms or other variations of
these terms or comparable language, or by discussion of strategy or
intentions. These cautionary statements are being made pursuant to
the Securities Act, the Exchange Act and the PSLRA with the intention
of obtaining the benefits of the "safe harbor" provisions of such
laws. Covanta cautions investors that any forward-looking statements
made by us are not guarantees or indicative of future performance.
Important factors, risks and uncertainties that could cause actual
results to differ materially from those forward-looking statements
include, but are not limited to:  


 
--  fluctuations in the prices of energy, waste disposal, scrap metal and
    commodities;
--  adoption of new laws and regulations in the United States and abroad,
    including energy laws, environmental laws, labor laws and healthcare
    laws;
--  the fee structures of our contracts;
--  our ability to avoid adverse publicity relating to our business
    expansion efforts;
--  advances in technology;
--  difficulties in the operation of our facilities, including fuel supply
    and energy delivery interruptions, failure to obtain regulatory
    approvals, equipment failures, labor disputes and work stoppages, and
    weather interference and catastrophic events;
--  failure to maintain historical performance levels at our facilities
    and our ability to retain the rights to operate facilities we do not
    own;
--  difficulties in the financing, development and construction of new
    projects and expansions, including increased construction costs and
    delays;
--  our ability to realize the benefits of long-term business development
    and bear the costs of business development over time;
--  the scalability of our business;
--  limits of insurance coverage;
--  our ability to avoid defaults under our long-term contracts;
--  performance of third parties under our contractual arrangements and
    such third parties' observance of laws and regulations;
--  concentration of suppliers and customers;
--  geographic concentration of facilities;
--  increased competitiveness in the energy and waste industries;
--  changes in foreign currency exchange rates;
--  limitations imposed by our existing indebtedness and our ability to
    perform our financial obligations and guarantees and to refinance our
    existing indebtedness;
--  exposure to counterparty credit risk and instability of financial
    institutions in connection with financing transactions;
--  our ability to utilize net operating loss carryforwards;
--  restrictions in our certificate of incorporation and debt documents
    regarding strategic alternatives;
--  failures of disclosure controls and procedures and internal controls
    over financial reporting;
--  our ability to attract and retain talented people;
--  general economic conditions in the United States and abroad, including
    the availability of credit and debt financing and market conditions at
    the time our contracts expire; and
--  other risks and uncertainties affecting our businesses described in
    Item 1A. Risk Factors of this Annual Report on Form 10-K and in other
    filings by Covanta with the SEC.

  
Although we believe that our plans, intentions and expectations
reflected in or suggested by such forward-looking statements are
reasonable, actual results could differ materially from a projection
or assumption in any of our forward-looking statements. Our future
financial condition and results of operations, as well as any
forward-looking statements, are subject to change and inherent risks
and uncertainties. The forward-looking statements contained in this
Annual Report on Form 10-K are made only as of the date hereof and we
do not have, or undertake, any obligation to update or revise any
forward-looking statements whether as a result of new information,
subsequent events or otherwise, unless otherwise required by law. 
Investor Contacts
Alan Katz
1.862.345.5456 
Clare Rauseo
1.862.345.5236 
IR@covantaenergy.com 
Media Contact
James Regan 
1.862.345.5216 
 
 
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