Waste Management, Inc. (WM) Earnings Call Transcript & Summary

So anyway, let's go ahead and get started with the next presentation. So this morning, I'm really excited to have Waste Management with us. Presenting today is Jim Fish, the company's President and CEO. We also have Devina Rankin, the company's CFO. So for those that may not know me, I'm Tyler Brown. I'm the Senior Analyst here at Ray Jay. So I cover both the environmental services space as well as the transports. So Jim, you've been to our conference before. It's a generalist conference by nature. So our hope is, is maybe just a few comments upfront. Just talk a little bit. I think most people know who Waste Management is, but maybe just a little bit of talk about Waste Management and your position in the market, maybe some of your strategy. Then we'll kind of kick it into a Q&A, maybe more of a fireside chat. [Operator Instructions] So Jim, with that, maybe a few opening remarks, and then we'll kind of get into it.

Perfect. Thanks, Tyler. Well, look, I'm looking forward to being back in Florida next year. This is 2 years in a row. And last year, I think we got canceled overall. But this year, at least we're able to do it via Zoom. Next year back to Florida. But in any event, thanks for having me today. I didn't bring a deck to present. Typically, we do bring something, but we didn't -- at the risk of having to share my screen, that might have been a mess. But most of you probably know who we are. Waste Management is the biggest in our space. And we're approximately kind of $15.5 billion in revenue, will be bigger next year for a couple of reasons. One is the business is going to grow next year organically. But also because we had 2 months of our acquisition this year. We acquired a company called ADS, and we acquired them at the end of October. So we had 2 months of their revenue in our earnings for last year. We'll have, of course, 12 months next year. So we will be bigger next year. We are a big player in the recycling space. We're the biggest recycler in North America. Also, the biggest landfill company in North America. We're very focused strategically on a couple of things. We're focused on technology, and you might say, well, so why do you need technology for in an industry that's kind of a labor-intensive business? One of the reason we are focused on technology is because it is a very labor-intensive business, and we like to make it a little bit less so. So we are focused on this end-to-end solution for customers. The comparison I always use is Amazon because Amazon, in terms of logistics, I'm not sure there's anybody out there better with all due respect to another great company, UPS and I know Tyler had UPS this morning on a fireside chat. I still think Amazon is the best of what they do in terms of logistics. And we want to try and replicate that. If you think about all of the people that support our logistics operation, we have somewhere in the neighborhood of 18,000 trucks now that are routed that are picking up trash, picking up recyclables every day. And so as a consequence, we have a huge support system that is very labor intensive. And if you compare the 2 companies, Amazon has a much lower labor burden on their logistics network. So part of our investment that we've talked about recently is in technology, and it's providing this end-to-end solution for the customers. Not only does it make it easier for them to interact with us, but it also reduces the cost of our -- of us bringing that to -- bringing our business to them. So technology is a key focus area. And then ESG is a very important focus area for us, too, and some people kind of look at ESG and say, yes, I get it. It makes sense, but I'm not sure how it adds to your bottom line. And so I would tell you that there's a couple of ways it adds to the bottom line. First of all, as I said, we are a big recycler, the biggest recycler out there. And part of that e-component is traditional recycling. We're changing the way we recycle. We've built a couple of new plants with a different type of technology. One of the themes that you'll hear from me is reducing labor costs. And so as I just said about kind of the cost of bringing our collection operations to our customers, there's also a labor cost reduction with our new recycled plants. We now have 3 of them, but just to put it in perspective, a big single stream plant takes about 150 people to run. The new single stream plants take kind of somewhere between 20 and 30 people to run. So there's a lot more technology in those plants and a lot less labor. So we're changing the way we recycle. We're changing the way we handle organics. We're looking for solutions for materials that don't have much value to them today, meaning low-value plastics and mixed papers. So we think we've got a couple of pretty interesting solutions for that, and those will benefit not only the environment, but they also benefit -- one thing I said consistently is sustainability needs to be both environmentally and economically sustainable to be viable for the long term. So when we look at solutions for low-value plastics, for example, it's got to be a good economic solution in addition to a good environmental solution. So ESG is a strong focus for us. We think that as -- we think about the waste pie that it helps us get a bigger slice of that pie, and we see that already in practice with companies like Home Depot that renewed their contract with us at a pretty significant price increase, which, by the way, doesn't happen very often with Home Depot and doesn't happen very often with Walmart. And Doug McMillon was on our Sustainability CEO Panel for our Sustainability Forum a couple of weeks ago. And Doug said, not only did he say thanks for your leadership, but he said, Jim, we love doing business with companies that really kind of reflect our values on ESG. So I think that the way ESG benefits our shareholders is by giving us a bigger slice of the existing pie. I think you'll see the other public companies follow suit fairly quickly on that front. But the public companies make up 50-ish percent of the collection market. So there's another 50% that are small companies. And they're not likely going to follow suit. And if they do, it's not going to be nearly as quickly. So I think it gives the public companies a chance to really expand our percentage of the pie, specifically, it gives Waste Management a chance to expand that, whether it's on the collection side or on the landfill side. Landfill is a little different because not only are we focused on ESG through things like renewable natural gas plants, but landfills are a -- are kind of a finite asset there. They have a finite life to them. And those -- the lives of all landfills in the U.S. and Canada are, well, eventually come to a close. We have a -- we have about a 50-year average life for our landfills. So ours aren't coming to a close soon, but we do have the best located landfills of any company in North America. And landfills, while there -- you may say, well, how is that ESG focused? We are focusing on renewable natural gas, which have very strong returns. Tyler, you and I can talk about that if you have questions on it, but renewable natural gas plants, we have 4 of them now. The returns on those, the payback for those is probably 2 to 3 years at current RINs rates. So we've made some nice investments there, and we'll continue to make investments in those. But we really like our position. And I said on the last call, I'm always somebody that maybe it's my nature as a CEO that's worried about something, whether it's worried about labor and the pool being small, whether it's worried about the economy or worried about something in our business, worried about recycling. And I would tell you that maybe I should be worried about the fact that I don't have any big worries right now about our industry. I think our industry is definitely a reopen play. Typically, we've been a defensive play. We are absolutely a reopen play. And I can tell you how the reopen is going to look based on states that have reopened so far. Tyler, let's talk about that as one of -- hopefully, one of your questions about what we think this looks like. But once all of the states reopen, I already know what the reopen looks like, and what the trajectory is because I know what it looks like in Texas, I know what it looks like in Arizona, I know what it looks like in Florida. So overall, and I'll stop there. We feel like there's some big strategic moves we're making, but we also feel really, really confident about the health of the business and about the fact that we haven't really been priced as a reopen play. We've kind of been priced as a defensive play. I love the prospects for the industry, and I love the prospects specifically for WM.

Well, Jim, that is a perfect segue, exactly where I was wanting to go. So I appreciate that. So let's talk about that. So 2020, in some regards, was the worst possible setup for you, where you had complete parts of the economy, ceasing service, [ station ] of service, pausing of service, you had certain parts of the economy just completely going to sleep. So let's talk about that reopening aspect. Again, I think a lot of people think of this business as very sticky, very defensive, very boring, and that's true in a lot of it. But there are some volumetric parts of the business that when people simply start going back to concerts or to the Raymond James conference, for example, you probably haul at the hotel in Florida that we typically have this ad. So when you think about that, can you talk about some of the areas where you think you'll start to see some of that flow through the revenue and ultimately the P&L?

Yes. So I mean, you talked about the hospitality space, Tyler. I mean that's -- it's funny because a lot of people who don't know the industry would say, well, guys, I mean -- but the trash business didn't get hit by COVID. I mean there's always going to be trash. Well -- but think about the fact that -- and we've talked about this number. I mean, 12% of our commercial business is schools, meaning all levels of school, meaning universities, meaning high schools, grade schools, 12%. And a lot of those schools have not returned. I mean in certain states, I think it's tragic, honestly. But in some states, those schools have not returned. Public schools in California have not returned. They've been out since March. And I know there's a big outcry right now from some of the parents there. But there's -- a lot of these states have not fully returned, whether they've returned at all, or whether they've just returned kind of 2 days a week, our business in the school sector is not the same. Certainly, in the hospitality space, I mean, you talk about all of the business that's generated, whether it's recycling or trash at the hotel that you typically host us at in Florida. I don't know where their occupancy rates are right now. But I talked to the CEO of Sabre last week, and he was saying, look, hotels are still across the United States dramatically down year-over-year. Some are starting to come back, and Florida is one place, where it's starting to come back. But still dramatically now. Somebody told me we pick up half -- and I haven't verified this, but we pick up half of major league baseball teams. And they have 162 ball games a year, 81 home games, so 81 home games generates a lot of trash and a lot of recycling. Last baseball season, no baseball team had a single fan in the stadium other than for the World Series. So that business went away. Same with basically all the other major sports, and we provide services to a lot of sporting teams, a lot of hotels, a lot of businesses that revolve around those, the restaurants that are tied to Minute Maid Park here in Houston or Fenway Park in Boston. None of those businesses have really restarted. And when I look at our commercial business, it is our singlest highest -- it is our single highest margin line of business for our commercial -- or for our collection businesses. Our only other line of business that has higher margins is our landfill line of business, and those were the 2 businesses that were hit the hardest. So yes, people continue to create trash, but we have been impacted by this. But that's why, Tyler, it was amazing to me that in Q4, our -- if you look at our Q4 EBITDA, up 4% when you take out the -- when you make it apples-to-apples and take out the $38 million from ADS. So apples-to-apples, up 4%. If you pull that out and pull out the big one timer in 2019 for the fuel tax credits, we were up 4% in EBITDA in a year, where our volume was still down as a company, down 2.5%, and our high-margin businesses like commercial were down 4.5%. It's why I'm so bullish on this. And when I look at the reopening, kind of to your question, I was looking at some of those areas like Texas. Commercial volume in Texas. I happen to look at the month of January, and this isn't -- I'm not giving it -- because this is not material to the overall company. But commercial volume in Texas was almost flat year-over-year. And yet, when I look at some of the other areas, such as -- I mean -- and I've got the data up on my screen, but I look at some of the other areas down 7.2%, down 11.6%, down 8.2%. And yet, I look at the areas that have opened up, down 0.6%, down 1.2%, flat, up 2.3%. I mean, so what it tells me is that when the economy reopens, the trajectory of that reopen will look like this. A normal reopening and even in '08, which was a deep downturn, still looked kind of like this. I don't know if you can see my hand, but it kind of looked like a more natural. But with this, because it was so -- the closure was so unnatural, and we literally fell off a cliff, then almost by definition, the reopen is going to look like this. And I don't know whether you want to call that a V or not, but I tell you, in some of the states, it is absolutely a V, and I see it in my data. So in that 11.6% -- when that area that's down 11.6% in commercial volume, when it reopens, it's going to be a massive uptick in volume for us. And that's why I'm so bullish on the sector, not to mention, by the way, and we'll talk about recycling, what recycling is going to do for us.

Yes. And so maybe as we talk a little bit more about collection here. So the other -- we at Ray Jay have a pretty constructive housing outlook, let's just say. And I would think that you guys are probably seeing that start. And I think this summer, you'll definitely see it in some of the temp volumes. And could you -- would you generally characterize it as a lag benefit as those new single-family homes are ultimately put into permanent units of service. We get the Starbucks buy it. We get the grocery store, et cetera, et cetera.

So the 3 big waste streams in our landfill, Tyler, as you know, MSW is kind of the -- I call it kind of the annuity of the landfill because that volume continues to come in. Even if I look at MSW volume, even in Q2, which where it fell off the table, MSW was down, probably it's down 9.4% in Q2. So it was down a lot, but that's where the whole economy closed. But then it bounced back to flat basically for Q3. So we were up 0.1% in volume in MSW and then up in Q4, up 1.2% in MSW. But those lines of business that fluctuated so much where we really stand to benefit, as you point out, C&D. I mean, C&D is largely tied to -- I mean, it's -- the name -- it stands for construction and demolition. So it's largely tied to residential construction. So when you see housing starts approaching 1 million recently, not up to where it was in 2006 at 2 million, but it still is significantly better than where it was in Q2 and Q3. And when you look at our C&D volume, our C&D volume for Q2 was, don't fall out of your chair, was down 41.1% for Q2 of 2020. Now a little bit of that was fire volume, but still, a lot of that was just construction going away, 41.1%. Then all of a sudden, Q3 was down 19.4%. And as we reported last week or 2 weeks ago, in Q4, C&D volume was up 5.5%. So a massive turnaround in C&D, and that's not going to stop. That's only going to continue. So we're excited about what C&D means for us. Housing starts are -- C&D is probably the one leading indicator that we have in our business, right? It tend to be a bit of a lagging indicator, but C&D is probably the best leading indicator because you see that construction. And then you see commercial business pick up. You see all of those -- the businesses tied to those communities, you see restaurants coming in. You see dry cleaners, all of that starting to be added. So C&D is the leading indicator there. The other business that we're encouraged about is special waste. Special waste for those of you who aren't familiar with it is kind of vent-type work. It can be cleanup work. It can be construction work for a new arena or a new building, it can be cleanup of some type of spill, or it can be just -- honestly, what John Morris says, you put a shovel in the ground at any of these places in South Texas, and you have special waste because it's always contaminated soil because a lot of it has been through the oil and gas space contaminated over time. So when Marathon or ExxonMobil does any type of cleanup, it's almost always special waste, but they can dictate the timing of it a little bit. So they've held off on those. They put those on the back burner, but they do have to do them. Our special waste business has -- it was down 20% in Q2. It's cut those losses by half, but the pipeline is what's most interesting to me, and the pipeline is very strong in special waste for us. We love the fact that CCRs, coal combustion residuals, will be a real strong line of business for us, particularly in this new administration, with the EPA. I think the appointment is the guy from North Carolina, and if he gets confirmed, the new administrator is probably going to take a tough stance on coal combustion residuals, and that will be a positive for us. So I think as we look at our landfill line of business, especially special waste and C&D, it kind of portends a strong rebound in the account.

Right. And so one other kind of aspect that I wanted to hit on briefly is there was some chatter again on the call about CPI. And maybe you can talk a little bit about how much of your business is tied to CPI? I think the question is like, is it a good thing for you or not? My general take is it probably is. I understand that there could be a unit cost inflation side of that equation. But you guys already seem to pay pretty high in, let's just call it, the broader blue-collar worker complex. So can you just talk about how CPI would mathematically work through your system? And is a higher CPI and a little bit inflation, a little bit of inflation in the system, probably a net good thing.

So I'm going to answer a little bit of this, and then I'm going to have Devina talk more on the cost aspect of it because we've already been seeing inflation for a period of probably 2 or 3 years. But yes, CPI is -- has been low for, I don't know, a decade. And we do see some signs of CPI being more of a tailwind for us. It really hasn't been. And to answer your one question, about 40% of our overall business is tied to some type of index pricing. So something, whether it's CPI or CPI-U or some regional index, but it is somewhat tied to an inflationary index of some type. And so we feel like that probably is going to -- we are seeing some signs of it, which I'll let Devina talk about. We think it's going to be a tailwind for us.

Yes. I mean, Tyler, I think the point that's most interesting here is that in this business, that 40% that Jim speaks about isn't necessarily an indication of the total opportunity from a pricing perspective, right? I mean the pricing lever exists across the network. And so while we focus on that 40%, I think it's mostly because that 40% has been tied down instead of having the same opportunity for PI. And then on the cost side of the equation, I think what's really important here is we have been seeing wage inflation, and that's not just on the green trucks. It's also in third-party transportation, in particular. So you're seeing that in labor and benefits. You're seeing it in repair and maintenance costs, and you're also seeing it in subcontractor cost, transfer and disposal costs. So we have been seeing a level of cost inflation in the business for the last several years. I think Waste Management story there is that we do a fantastic job at the top line from a pricing discipline perspective, making sure that our pricing outpaces that cost inflation and the structure. And then on top of that, the efficiency focus is, whether it'd be using technology to become a more efficient organization or just the things that we've talked about for the last couple of years, managing 100% of the workday, all of the standardization of processes. And we're seeing tremendous value in those processes and actually getting good reminders of how strong our processes are as we integrate the ADS business. So what you can see is that Waste Management's ability to outpace inflation is not just on the price side, driven by that CPI index on the 40%, but also on looking for efficiency opportunities, which we've talked about over the long term, being 50 to 100 basis points of value on an annual basis. In 2021, I think the reason that's a little metered or reduced from a typical year is there are parts of the cost structure that we think are going to -- on a year-over-year basis have bad comps. But over the long term, that's not an indication of a step away from that 50 to 100 basis points of inflation or of efficiency gains in the margin of the business.

And just to be -- just mathematically clear, if you do see CPI kind of pick up, it takes a little bit of time for it to filter into the business model. We won't see it necessarily day 1, it takes about 1 year, 18 months to kind of filter in.

That's exactly right. And a lot of times as annual resets are in the second half of the year. So you think of again, a lot -- a lot of them are in July, and then they have a lot in Q4 as well. So -- and then you have a lag impact because it's always a backward look.

Okay. And then -- so Jim, I've talked quite a bit on the calls with John Morris about residential. And this is one of those areas where you talked about commercial being your best line of business in Holly. I surmise it is. I would also surmise that maybe resi its worst line of business in terms of margins, a, is that true? And b, what is the opportunity to push the ball forward on residential? Because it feels from an outsider's perspective, that there's a real opportunity here in the broader -- from a portfolio perspective, to really help the margin profile of the entire business and it's become even more important when you buy ADS. Because by definition, your divestitures were largely in landfill and commercial. So you're -- I hate to say kind of double down at some level on residential, but moving the margin ball forward on residential seems like it's kind of an imperative.

Well, that's right. I mean, you are right about the fact that in the collection lines of business, residential has the lowest margin. Not really that surprising. I mean, first of all, you have customers, typically big municipalities with big buying power. I mean, and big chunks of business there. So from that standpoint, it's not that much different than national accounts because you're dealing with as opposed to commercial, where you have little small customers, you're dealing with great, big customers in much of our residential line of business. So -- but with that said, we've historically taken the approach that, look, but we internalize the volume into our landfill, or we internalize into a recycling plant. And so therefore, while the margins are not great there, we still are moving volume at higher-margin into a landfill or recycle plant. But look, I think that's an old way of thinking. And those -- that residential line of business needs to stand on its own 2 feet. Over a period of a decade, the margins had dropped in just about 1/2 in the residential line of business. And we just said, 18 months ago or 2 years ago, enough is enough. I mean, John, part of your -- honestly, part of your compensation is going to be driven on how well you do with rebuilding the margin in the residential line of business. And some of that comes in the form of calling out contracts. It's a little different than calling out contracts with commercial customers. In this case, you wait till the RFP. And then we just simply bid it at an acceptable return. And if the -- if our -- if we're differentiated enough because we provide a certain level of service and by the way, there are a lot of examples of that, where the community will stay behind WM and say, we like the service, we like the driver, whatever it is. And so what if it's a 10% price increase. I'm paying $40 a quarter. So if you -- in percentage terms, it feels like a lot, but I'm willing to pay an extra $4 a quarter for the peace of mind of knowing that my trash and my recycling are going to be picked up every week. I had a call yesterday just anecdotally from a customer, who -- we just bid away their contract. We bidded at high and municipality went with someone else. And she said, almost every other week, either their trash or their recycling gets missed. And she said, I don't know my driver. Your driver was the same driver for the last 3 years. I don't know my driver because they change all the time. Part of it's because -- I would guess that company has probably 50% to 75% turnover in their driver ranks. I mean that's not that unusual for small businesses. That's -- the big companies, the waste connections or public and waste management, we all have something in the neighborhood of 15% to 20% turnover. 75% turnover is hard to deal with. And what happens, the -- kind of the end result of that is that while you may think that we're better off to bid this contract because instead of $40, they're now going to $35. And so we're actually getting a $5 reduction and Waste Management was going bid $44. The customer ultimately says, man, for that $9 difference, $36 a year, I'll take the peace of mind of knowing that my trash is going to be consistently picked up every week. So I think what we're doing is we're saying we're not going to try and chase that down to $35. We're going to take it up to $44, which now gives us a realistic and reasonable return and a good margin. And if the community wants to keep our services great, we'll do it, and everybody will be happy. If they don't, they go with $35, and we'll see you next time around.

Yes. So I want to talk a little bit though about recycling, and how this plays into resi because I'm still a little murky as to -- when we talk about the -- down half in margins, is there a recycling component to that? Or maybe just talk broadly about recycling and also improving just post-China's moves a few years ago, just kind of improving that business on its own as well.

Yes. So I'll probably split this one with Devina as well. And Devina, you can talk about the margin aspect there. But I think as we think of the overall recycling business, as you know, Tyler, we've really changed the price model a little bit so that the old model was kind of paying these rebates, irrespective of the returns for the business. And that worked fine in a normal kind of $100 average commodity price because our cost might be 75%. And so we -- and then we tack on a margin, and we share some of it with the municipality. The problem is, when all of a sudden, the price is not $100 anymore, the price is $50 and we've got an old legacy contract where we guarantee them that we will give them $15 a ton, now all of a sudden, we're really upside down. So the lion's share of those contracts have been renegotiated. And now we're pricing on a cost-plus basis. So we build in a healthy margin. And then if there is something left, then we'll share it with you. If there's not something left, then we were guaranteed a base return. We're also building in a fee-based structure there. So for things that -- part of the problem with the cost side of the business, not necessarily the price side, has been that we have to process a lot more because of the contamination that's coming into the system. And so we've built in pretty significant mechanisms for -- price mechanisms for contamination, and they come in the form of fees to these customers. They didn't necessarily like it, but I think it's done 1 of 2 things. It's either helped us from a revenue standpoint, or it's changed their behavior. And either one is a positive for us. One of them lowers the cost, if they do change their behavior, now all of a sudden, the contamination in that single stream plant is lower and that -- and therefore, the cost per unit is lower, or they don't change their behavior, but they have to pay us more for it. And that's okay, too. So I do think, though, that as we think about margins, and there is some -- obviously, there's some tied to commodity price, I believe that we're on a -- anything you read about commodity prices, not just corrugated cardboard, but anything you read about commodity prices would tell you that we're on a 5 -- 3- to 5-year uptrend. And so Devina, maybe you can talk a little bit about what that means overall for us from a margin standpoint.

Yes. Jim covered it really well. I mean on the commodity price side, I think we've always talked about the old math that we would do in terms of a $10 increase in the bundled commodity values impacting our EPS by $0.04 a share on an annual basis. Jim has covered all of the reasons that we've broken that traditional math equation, but there certainly is tremendous value still to an increasing commodity value. I think what's important, though, is the stickiness of recycling and tying it back to the residential line of business, what you've mentioned is how are those connected? And how are we thinking about them? I think in the past, it was -- recycling was thrown in for free. And I think the new model that has been built that is really driving the margin performance and breaking it away from the commodity value is ensuring that it's a fee-for-service first. And because it's the same return on invested capital that you're looking for for that truck and for that container. And that fee-for-service model is giving us the kind of baseline return that we need in order to achieve that second in line return on invested capital over the long term for the recycling line of business. And then the commodity value is just incremental and the upside potential as well as the downside potential impact of commodity value have just been moderated because of the fee-for-service model. So -- but the margin, I would say, in the recycling line of business, has been a fantastic story in 2020, and we expect it to be a continuing one. Price is a piece of it, but as is cost. And that was a place where the contamination impact that Jim was mentioning were really getting away from us. And with the benefit of the surcharges as well as education and our focus on technology in order to improve processing in certain locations. All of those things are working together to moderate the rate of increase in that gross operating expense per ton in the recycling line of business. And that's going to help margin as is the revenue structure.

Perfect. Okay. And then we've got a couple of minutes left. And Jim, I want to talk about -- you talked about this at Analyst Day. But talking about leveraging the brand because I do think that you guys have a unique position that everybody knows who WM -- who you are. Also, there is an opportunity for technology to interface me. So you actually pick me up, for example. So how can you digitally interface with me as a residential subscription customer? But then also how do you leverage your brand? And do those at some level kind of actually married together? That question.

Yes. So brand is interesting because I've never been a huge brand guy. I mean, I'm not a huge marketing guy. But here's what I would tell you about brand. I mean, brand, just for the sake of people knowing who WM is, I'm not sure how much value there is to that. But brand -- if they link us to something. And in our case, what we're attempting to do with brand is to be linked to ESG. I think ESG has -- ESG is almost going to become the [ anti ] to get into the game. But ESG is an expectation. I think we are ahead of most in terms of ESG. And that shows up in some of the awards we win. But it also shows up in -- when Doug McMillon says to me, Jim, thanks for your leadership on ESG. And so brand has the potential to give us a bigger slice of the existing pie. That's where brand is valuable to me. It's not like consumer brands, where I -- there's something that goes on in my brain. And then when I say a Budweiser on the screen, and I see, you know I'm going to do, I'm going to stop by the convenience store and pick up a 6 pack. That's not the brand that we get. I mean, nobody says, I think I'm going to change over to Waste Management services. But that linkage to ESG is very important for us, and we think that has tremendous value. So when somebody like the CEO of Walmart, says, you guys are really taking a leadership role. Even Satya, who -- we don't do a lot of business with Microsoft, they don't create a lot of recycling or trash. But Satya said, look, you guys have really started to separate yourselves. You're a much different company than you were 10 years ago, that's meaningful to us. It shows up in a rebid of the Home Depot contract. Part of the reason we held that contract at a really nice price increase was because we're focused on ESG. And so we're trying to link our brand as something that is valuable. And I think ESG and technology are the 2 things that link us. So quickly on technology, I'll use Amazon, again, as an example. Everything you do when you order from Amazon is digitized. So you go on their website, it's easy, you put your order in. And then magically, there's a whole bunch of behind the same stuff that happens in order to get your -- the brush for your barbecue grill or whatever you order, whatever you order from Amazon, it shows up on your doorstep the next day. And there's now a huge fleet of those Amazon vans running around. And they do that. There's a couple of things that we're hoping -- we're aspiring to look like Amazon from that standpoint. We're not trying to become Amazon. But when it comes to that digital interface with you as a customer, everything you do, checking your bill, ordering a new container, ordering a -- you've got a wheel that broke off to your container, everything you do can be done digitally. And we take all of these -- when you look at the behind the scenes of WM, it is very different than the behind the scenes at Amazon. Amazon, pretty much everything. When it comes to the customer experience, there isn't a phone number you can call. Everything is done. You don't call them. We have -- we take 12 million calls a year for 22 million customers. They take -- I read that they take 1 million calls a year for 250 million customers. So there's a big burden of cost there. So our hope is through the digitization of this interface is we do 2 things. We reduced the cost to provide that service, and we make it -- we make ourselves easier to do business with. So you don't have to call. The general contractor doesn't have to call an order and empty in return on their construction site in Seattle. They just go on to this thing. They go on to this and they go onto wm.com, and they order the thing and it shows up. And we tell them when it's going to be there. And it gets there within the window that we've given them. By the way, if they want it this afternoon, there's a price opportunity. Because if they want that container this afternoon, the price is higher than if they want it on Friday morning, which is the standard price. So that's what we're expecting to get out of this customer service digitalization.

Perfect. With that, we are out of time. But I appreciate you guys so much for doing this virtually. We look forward to seeing you next year. And until then, we'll speak soon.

Thanks so much, Tyler.

Thanks, Tyler.

Thank you.