IESI-BFC Q4 Profit More Than Doubles; Helped by Acquisition

Date: February 22, 2011

Source: IESI-BFC Ltd.

IESI-BFC LTD. Announces Strong Results for the Three Months and Year Ended December 31, 2010

IESI-BFC Ltd. (the "Company") (TSX: BIN)(NYSE: BIN) reported financial results for the three months and year ended December 31, 2010.

(All amounts are in thousands of United States ("U.S.") dollars, unless otherwise stated)

Management Commentary

Reported revenues increased $167.4 million or 63.8% from $262.5 million in the fourth quarter of 2009 to $429.9 million in the fourth quarter of 2010 due in large part to our acquisition of Waste Services, Inc. ("WSI").

Organic gross revenue, which includes intercompany revenues, grew 4.9% on a consolidated basis and is comprised of total price and volume growth of 3.1% and 1.8%, respectively. Quarterly price and volume improvements in Canada were 4.0% and 2.3%, respectively, and 2.5% and 1.3% in the U.S. All revenue growth components outlined above have been prepared on a comparable basis, as if WSI's operations were combined with ours in the current and previously comparable quarter, and assuming a foreign currency exchange ("FX") rate of parity.

Strong revenue growth translated into strong adjusted EBITDA(A) and operating income growth. Adjusted EBITDA(A) was $123.0 million, or 63.2% higher, in the fourth quarter of 2010 versus $75.4 million in the same quarter a year ago. Our fourth quarter adjusted EBITDA(A) margin was 28.6%. Adjusted operating income(A) was $60.8 million, or 54.1% higher, in the quarter versus $39.4 million in the comparative period last year.

We also generated higher adjusted net income(A) quarter over quarter. Adjusted net income(A) for the fourth quarter of 2010 was $26.8 million, or $0.22 per weighted average diluted share ("diluted share"), compared to $15.0 million, or $0.16 per diluted share in the comparative period.

Free cash flow(B) for the quarter totalled $42.0 million and was 78.8% higher than the $23.5 million in the comparative period last year. Our free cash flow(B) yield was 9.8% in the quarter compared to 9.0% in the fourth quarter of 2009. Free cash flow(B) growth was the result of a strong operating performance, which was partially offset by higher interest expense and capital and landfill purchases. The increase in each of these measures is largely attributable to the acquisition of WSI.

"In 2010, our Company once again distinguished itself as a growth leader in the North American waste management industry," said Keith Carrigan, Chief Executive Officer of IESI-BFC Ltd. "We completed the acquisition of WSI and, thanks to the efforts of our combined team, we are on track to realize the upper end of our expected synergies. We also continued to strengthen our network of assets through our strategic acquisitions of Fred Weber Inc., Crown Excel Disposal LLC and Weber Gas Energy, LLC in St. Louis, Missouri, SWDI LLC in southern Louisiana, York Disposal in Toronto, Ontario, and ten other "tuck-in" acquisitions. In our existing business, we achieved organic revenue growth of 6.7% through our bottom-up focus on price, volume and productivity. As a result, we enhanced our performance across the board in 2010 and set new milestones for key benchmarks. Revenue increased 41.8% to $1.43 billion, adjusted EBITDA(A) increased 42.5% to $413.8 million, and free cash flow(B) grew 67.6% to $191.3 million."

Mr. Carrigan continued, "In 2011, we are strongly positioned to further improve our results through organic growth initiatives. Our outlook for 2011, which excludes the impact of additional acquisitions, anticipates revenue growth of 25.9%, adjusted EBITDA(A) growth of 32.9%, adjusted EBITDA(A) margin expansion of 170 basis points, and free cash flow growth(B) of 41.1%. We remain focused on identifying the most accretive opportunities for the deployment of our additional cash. Our balanced approach to creating shareholder value will continue to include a disciplined acquisition program, the payment of quarterly dividends in 2011, as well as other opportunities that meet our return criteria."

For the year ended December 31, 2010, revenue was $1,429.8 million, compared with revenues of $1,008.5 million a year ago. Adjusted operating income(A) was $206.6 million, or 54.2% higher than the $133.9 million in the same period last year. Adjusted EBITDA(A) was $413.8 million compared to $290.4 million in 2009. Our year-to-date free cash flow(B) increased to $191.3 million up from $114.1 million and our free cash flow(B) yield increased 210 basis points to 13.4% from 11.3% a year ago.

For the year ended December 31, 2010, adjusted net income(A) was $101.0 million, or $0.94 per weighted average diluted share, compared with $59.6 million or $0.70 per share in the year ago period.

Financial and Other Highlights

For the Three Months Ended December 31, 2010


--  Revenues increased $167.4 million or 63.8% ($156.5 million or 59.6%,
    excluding FX)
--  Adjusted EBITDA(A) increased $47.6 million or 63.2% ($44.6 million or
    59.3%, excluding FX)
--  Adjusted EBITDA(A) margin, on a reported basis, was 28.6%
--  Free cash flow(B) increased $18.5 million or 78.8% ($18.3 million or
    78.1%, excluding FX)
--  Free cash flow(B) yield of 9.8%
--  Adjusted net income(A) per diluted share, $0.22
--  Consolidated price increased 3.1%, prepared on a comparable basis
--  Consolidated volumes increased 1.8%, prepared on a comparable basis

For the Year Ended December 31, 2010


--  Revenues increased $421.3 million or 41.8% ($364.3 or 36.1%, excluding
    FX)
--  Adjusted EBITDA(A) increased $123.4 million or 42.5% ($104.8 million or
    36.1%, excluding FX)
--  Adjusted EBITDA(A) margin, on a reported basis, was 28.9%
--  Free cash flow(B) increased $77.2 million or 67.6% ($67.7 million or
    59.3%, excluding FX)
--  Free cash flow(B) yield of 13.4%
--  Adjusted net income(A) per diluted share, $0.94
--  Consolidated price increased 4.1%, prepared on a comparable basis
--  Consolidated volumes increased 2.5%, prepared on a comparable basis

2011 Outlook

The Company is providing its outlook for 2011 assuming no change in the current economic environment and excluding the impact of any additional acquisitions. For the purposes of these estimates, the Company is assuming a Canadian to U.S. dollar exchange rate of parity.

The outlook provided below is forward looking. Our actual results may differ materially and are subject to risks and uncertainties which are outlined in the forward-looking statements section of this press release.


--  Revenue is estimated to be approximately $1.8 billion
--  Adjusted EBITDA(A) is estimated to be approximately $550 million
--  Amortization expense, as a percentage of revenue, is estimated to be
    approximately 14.5%
--  Capital and landfill expenditures are estimated to be approximately $155
    million
--  The effective tax rate is estimated to be approximately 36% of income
    before income tax expense and net loss from equity accounted investee
--  Cash taxes are estimated to be approximately $54 million
--  Adjusted net income(A) per diluted share is estimated to be $1.16
--  Free cash flow(B) is estimated to be approximately $270 million
--  Expected annual cash dividend of $0.50 Canadian ("C") per share, payable
    on a quarterly basis

Other Highlights for the Three Months and Year Ended December 31, 2010

WSI Acquisition

On November 11, 2009, we executed an Agreement and Plan of Merger (the "Agreement") with WSI. The Agreement provided for our wholly-owned subsidiary ("Merger Sub") to merge with and into WSI, with WSI surviving the merger as a wholly-owned subsidiary of IESI-BFC Ltd.

We executed the transaction pursuant to our strategy of growth through acquisition. Specifically, we believe that the acquisition will provide us with the opportunity to diversify our business across U.S. and Canadian markets, customer segments and service lines. In addition, the transaction enables us to increase our internalization in the Canadian and U.S. northeast markets. We also believe this acquisition will create annual synergies and cash flow and earnings per share accretion, which we expect will enhance short and long-term returns to shareholders. We plan to direct the expected additional cash flow resulting from the combined performance of the companies towards any combination of the following: growth capital, accretive acquisitions, debt reduction, common share repurchases or dividend payments.

We completed the acquisition on July 2, 2010 and issued 27,971 of our common shares to former WSI shareholders. Former WSI shareholders received 0.5833 common shares of IESI-BFC Ltd. for each share of WSI common stock issued and outstanding on July 2, 2010.

In addition, we assumed WSI's unexercised and outstanding options and warrants on closing which represents an obligation to issue a maximum of 505 and 194 common shares, respectively.

As outlined in the long-term debt section of this press release, we amended our long-term debt facilities in Canada and the U.S. to facilitate the acquisition of WSI. Monies available from these facilities were used to repay WSI's indebtedness outstanding at closing. In addition, the credit facilities were upsized to reflect the size of the newly combined operations in both Canada and the U.S. Pricing was increased to levels commensurate with market and maturities were extended to four years from the close of the transaction.

On the closing of the WSI acquisition, we expected our pro forma adjusted EBITDA(A) ratio, prepared on a combined basis and assuming FX parity, to be approximately 2.7 times. However this ratio improved to approximately 2.6 times. As of December 31, 2010, our pro forma adjusted EBITDA(A) ratio is approximately 2.5 times. This ratio includes our acquisition of Fred Weber Inc., Crown Excel Disposal LLC and Weber Gas Energy, LLC (collectively "Fred Weber") which we completed on December 23, 2010 for total cash consideration of approximately $162.5 million.

Acquisitions

In the fourth quarter, we completed four "tuck-in" acquisitions, two in each of the U.S. south and northeast segments. These "tuck-in" acquisitions, which included the acquisition of Fred Weber, were financed from excess free cash flow(B) and U.S. and Canadian credit facility advances.

Quarterly Dividend Declared

The Company's Board of Directors declared a quarterly dividend of $0.125 Canadian per share to shareholders of record on March 31, 2011. The dividend will be paid on April 15, 2011. The Company has designated these dividends as eligible dividends for the purposes of the Income Tax Act (Canada).

Financial Reporting Changes

On September 7, 2010, we announced that for the interim period ending September 30, 2010 and the year ending December 31, 2010, we have been granted exemptive relief by the Canadian securities regulatory authorities which allows us to discontinue the preparation, disclosure and filing of a reconciliation between our reported financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), and Canadian generally accepted accounting principles ("Canadian GAAP"). We believe that this reconciliation, which would no longer be required under proposed changes to Canadian securities laws, is of limited use to investors because we have been reporting in U.S. GAAP since March 31, 2009 and the changes in our business since that time (including the acquisition of WSI) mean that the Canadian GAAP-reconciled financial information is no longer readily comparable between periods or years.

On July 2, 2010, we completed our acquisition of WSI. WSI provides waste collection and disposal services in four Canadian provinces and the state of Florida in the U.S. WSI's Canadian operations are included in our Canadian segment, while their Floridian operations are included in our U.S. south segment. WSI's operating results have been included with our own since the date of acquisition. In addition, we have elected to exclude corporate allocated costs from the operating results of our reportable segments. Accordingly, expenses specific to corporate activities have been presented separately from those presented for our reporting segments, for each current and comparative period presented.

Financial Highlights

(in thousands of U.S. dollars, except per weighted average share amounts, unless otherwise stated)


                              Three months ended                Year ended
                                      December 31               December 31
----------------------------------------------------------------------------
                              2010           2009         2010         2009
----------------------------------------------------------------------------
                       (unaudited)    (unaudited)  (unaudited)  (unaudited)
----------------------------------------------------------------------------

Operating results
Revenues              $    429,879   $    262,462   $1,429,765   $1,008,466
Operating expenses         255,261        152,135      839,973      588,104
Selling, general and
 administration
 ("SG&A")                   56,186         40,897      192,865      136,846
Restructuring
 expenses                    1,388              -        5,180            -
Amortization                62,263         36,000      207,666      156,702
Net gain on sale of
 capital and landfill
 assets                        (33)           (70)        (414)        (198)
----------------------------------------------------------------------------
Operating income            54,814         33,500      184,495      127,012
Interest on long-term
 debt                       14,822          7,979       48,786       34,225
Net foreign exchange
 loss                           33             38           47          276
Net gain on financial
 instruments                (2,245)          (696)      (5,493)      (1,562)
Conversion costs                 -             90            -          298
Other expenses               2,566             53        3,210          162
----------------------------------------------------------------------------
Income before net
 income tax expense
 and net loss from
 equity accounted
 investee                   39,638         26,036      137,945       93,613
Net income tax
 expense                    17,953         16,161       55,658       39,885
Net loss from equity
 accounted investee              2              -          118            -
----------------------------------------------------------------------------
Net income            $     21,683   $      9,875   $   82,169   $   53,728
----------------------------------------------------------------------------

Net income per
 weighted average
 share, basic         $       0.18   $       0.11   $     0.77   $     0.64
Net income per
 weighted average
 share, diluted       $       0.18   $       0.11   $     0.76   $     0.63
Weighted average
 number of shares
 outstanding
 (thousands), basic        110,752         82,332       96,451       73,892
Weighted average
 number of shares
 outstanding
 (thousands), diluted      121,681         93,431      107,479       85,020

Adjusted EBITDA(A)    $    122,987   $     75,363   $  413,826   $  290,449
Adjusted operating
 income(A)            $     60,757   $     39,433   $  206,574   $  133,945
Adjusted net
 income(A)            $     26,818   $     15,039   $  100,976   $   59,591
Adjusted net
 income(A)per
 weighted average
 share, basic         $       0.22   $       0.16   $     0.94   $     0.71
Adjusted net
 income(A)per
 weighted average
 share, diluted       $       0.22   $       0.16   $     0.94   $     0.70

Replacement and
 growth expenditures
 (see page 15)
Replacement
 expenditures         $     43,419   $     24,580   $  100,578   $   73,674
Growth expenditures         14,611          9,821       42,063       48,602
----------------------------------------------------------------------------
Total replacement and
 growth expenditures  $     58,030   $     34,401   $  142,641   $  122,276
----------------------------------------------------------------------------

Free cash flow(B)
Cash generated from
 operating activities $    120,667   $     63,620   $  293,861   $  256,269
Free cash flow(B)     $     42,024   $     23,505   $  191,300   $  114,109
Free cash flow(B) per
 weighted average
 share, diluted       $       0.35   $       0.25   $     1.78   $     1.34

Dividends
Dividends declared
 (common shares)      $     14,954   $     19,265   $   48,179   $   68,825
Dividends declared
 (participating
 preferred shares
 ("PPSs"))                       -          2,608        4,006        9,748
----------------------------------------------------------------------------
Total dividends
 declared             $     14,954   $     21,873   $   52,185   $   78,573
----------------------------------------------------------------------------

Total dividends
 declared per
 weighted average
 share, diluted       $       0.12   $       0.23   $     0.49   $     0.92


                                              2010
----------------------------------------------------------------------------
                                                      Consolidated Statement
                          Consolidated                     of Operations and
                         Balance Sheet                  Comprehensive Income
----------------------------------------------------------------------------
                                                                  Cumulative
                               Current            Average            Average
----------------------------------------------------------------------------

March 31             $          0.9846  $          0.9607  $          0.9607
June 30              $          0.9429  $          0.9731  $          0.9669
September 30         $          0.9711  $          0.9624  $          0.9654
December 31          $          1.0054  $          0.9873  $          0.9708



                                              2009
----------------------------------------------------------------------------
                                                      Consolidated Statement
                          Consolidated                     of Operations and
                         Balance Sheet                  Comprehensive Income
----------------------------------------------------------------------------
                                                                  Cumulative
                               Current            Average            Average
----------------------------------------------------------------------------

March 31             $          0.7935  $          0.8030  $          0.8030
June 30              $          0.8602  $          0.8568  $          0.8290
September 30         $          0.9327  $          0.9113  $          0.8547
December 31          $          0.9555  $          0.9467  $          0.8760

FX Impact on Consolidated Results

The following tables have been prepared to assist readers in assessing the impact of FX on select consolidated results for the three months and year ended December 31, 2010.


                                        Three months ended
----------------------------------------------------------------------------
                              December          December          December
                              31, 2009          31, 2010          31, 2010
----------------------------------------------------------------------------
                           (unaudited)       (unaudited)       (unaudited)
----------------------------------------------------------------------------
                                               (organic,
                                         acquisition and       (holding FX
                                              other non-     constant with
                                               operating   the comparative
                         (as reported)          changes)           period)
----------------------------------------------------------------------------

Consolidated Statement
 of Operations
Revenues               $       262,462   $       156,536   $       418,998
Operating expenses             152,135            96,751           248,886
SG&A                            40,897            13,698            54,595
Restructuring expenses               -             1,310             1,310
Amortization                    36,000            24,651            60,651
Net gain on sale of
 capital and landfill
 assets                            (70)               35               (35)
----------------------------------------------------------------------------
Operating income                33,500            20,091            53,591
Interest on long-term
 debt                            7,979             6,519            14,498
Net foreign exchange
 loss                               38                (7)               31
Net gain on financial
 instruments                      (696)           (1,522)           (2,218)
Conversion costs                    90               (90)                -
Other expenses                      53             2,264             2,317
----------------------------------------------------------------------------
Income before net
 income tax expense
 and net loss from
 equity accounted
 investee                       26,036            12,927            38,963
Net income tax expense          16,161             1,537            17,698
Net loss from equity
 accounted investee                  -                 3                 3
----------------------------------------------------------------------------
Net income             $         9,875   $        11,387   $        21,262
----------------------------------------------------------------------------

Adjusted EBITDA(A)     $        75,363   $        44,658   $       120,021
Adjusted operating
 income(A)             $        39,433   $        19,813   $        59,246
Adjusted net income(A) $        15,039   $        10,807   $        25,846
Free cash flow(B)      $        23,505   $        18,347   $        41,852


                              Three months ended
---------------------------------------------------------
                              December          December
                              31, 2010          31, 2010
---------------------------------------------------------
                           (unaudited)       (unaudited)
---------------------------------------------------------
                           (FX impact)     (as reported)
---------------------------------------------------------

Consolidated Statement
 of Operations
Revenues               $        10,881   $       429,879
Operating expenses               6,375           255,261
SG&A                             1,591            56,186
Restructuring expenses              78             1,388
Amortization                     1,612            62,263
Net gain on sale of
 capital and landfill
 assets                              2               (33)
---------------------------------------------------------
Operating income                 1,223            54,814
Interest on long-term
 debt                              324            14,822
Net foreign exchange
 loss                                2                33
Net gain on financial
 instruments                       (27)           (2,245)
Conversion costs                     -                 -
Other expenses                     249             2,566
---------------------------------------------------------
Income before net
 income tax expense
 and net loss from
 equity accounted
 investee                          675            39,638
Net income tax expense             255            17,953
Net loss from equity
 accounted investee                 (1)                2
---------------------------------------------------------
Net income             $           421   $        21,683
---------------------------------------------------------

Adjusted EBITDA(A)     $         2,966   $       122,987
Adjusted operating
 income(A)             $         1,511   $        60,757
Adjusted net income(A) $           972   $        26,818
Free cash flow(B)      $           172   $        42,024


                                           Year ended
----------------------------------------------------------------------------
                            December           December           December
                            31, 2009           31, 2010           31, 2010
----------------------------------------------------------------------------
                                            (unaudited)        (unaudited)
----------------------------------------------------------------------------
                                              (organic,
                                        acquisition and        (holding FX
                                             other non-  constant with the
                                              operating        comparative
                       (as reported)           changes)            period)
----------------------------------------------------------------------------

Consolidated
 Statement of
 Operations
Revenues            $      1,008,466   $        364,282   $      1,372,748
Operating expenses           588,104            220,907            809,011
SG&A                         136,846             47,194            184,040
Restructuring
 expenses                          -              4,719              4,719
Amortization                 156,702             43,128            199,830
Net gain on sale of
 capital and
 landfill assets                (198)              (176)              (374)
----------------------------------------------------------------------------
Operating income             127,012             48,510            175,522
Interest on long-
 term debt                    34,225             13,120             47,345
Net foreign
 exchange loss                   276               (223)                53
Net gain on
 financial
 instruments                  (1,562)            (3,940)            (5,502)
Conversion costs                 298               (298)                 -
Other expenses                   162              2,779              2,941
----------------------------------------------------------------------------
Income before net
 income tax expense
 and net loss from
 equity accounted
 investee                     93,613             37,072            130,685
Net income tax
 expense                      39,885             13,276             53,161
Net loss from
 equity accounted
 investee                          -                106                106
----------------------------------------------------------------------------
Net income          $         53,728   $         23,690   $         77,418
----------------------------------------------------------------------------

Adjusted EBITDA(A)  $        290,449   $        104,781   $        395,230
Adjusted operating
 income(A)          $        133,945   $         61,865   $        195,810
Adjusted net
 income(A)          $         59,591   $         32,413   $         92,004
Free cash flow(B)   $        114,109   $         67,659   $        181,768


                                Year ended
--------------------------------------------------------
                            December           December
                            31, 2010           31, 2010
--------------------------------------------------------
                         (unaudited)        (unaudited)
--------------------------------------------------------
                         (FX impact)      (as reported)
--------------------------------------------------------

Consolidated
 Statement of
 Operations
Revenues            $         57,017   $      1,429,765
Operating expenses            30,962            839,973
SG&A                           8,825            192,865
Restructuring
 expenses                        461              5,180
Amortization                   7,836            207,666
Net gain on sale of
 capital and
 landfill assets                 (40)              (414)
--------------------------------------------------------
Operating income               8,973            184,495
Interest on long-
 term debt                     1,441             48,786
Net foreign
 exchange loss                    (6)                47
Net gain on
 financial
 instruments                       9             (5,493)
Conversion costs                   -                  -
Other expenses                   269              3,210
--------------------------------------------------------
Income before net
 income tax expense
 and net loss from
 equity accounted
 investee                      7,260            137,945
Net income tax
 expense                       2,497             55,658
Net loss from
 equity accounted
 investee                         12                118
--------------------------------------------------------
Net income          $          4,751   $         82,169
--------------------------------------------------------

Adjusted EBITDA(A)  $         18,596   $        413,826
Adjusted operating
 income(A)          $         10,764   $        206,574
Adjusted net
 income(A)          $          8,972   $        100,976
Free cash flow(B)   $          9,532   $        191,300

Management's Discussion

(all amounts are in thousands of U.S. dollars, unless otherwise stated)

Segment Highlights


                                 Three months ended December 31
----------------------------------------------------------------------------
                                2009               2010             Change
----------------------------------------------------------------------------
                                                          (2010 holding FX
                                            (holding FX  constant with the
                                      constant with the        comparative
                                            comparative   period less 2009
                       (as reported)            period)       as reported)
----------------------------------------------------------------------------

Revenues            $        262,462   $        418,998   $        156,536
----------------------------------------------------------------------------
Canada              $         96,473   $        170,703   $         74,230
U.S. south          $         86,882   $        158,760   $         71,878
U.S. northeast      $         79,107   $         89,535   $         10,428

Operating expenses  $        152,135   $        248,886   $         96,751
----------------------------------------------------------------------------
Canada              $         48,463   $         96,302   $         47,839
U.S. south          $         53,063   $         96,609   $         43,546
U.S. northeast      $         50,609   $         55,975   $          5,366

SG&A (as reported)  $         40,897   $         54,595   $         13,698
----------------------------------------------------------------------------
Canada              $          8,449   $         15,547   $          7,098
U.S. south          $         10,232   $         17,433   $          7,201
U.S. northeast      $          6,814   $          7,499   $            685
Corporate           $         15,402   $         14,116   $         (1,286)

EBITDA(A)(as
 reported)          $         69,430   $        115,517   $         46,087
----------------------------------------------------------------------------
Canada              $         39,561   $         58,854   $         19,293
U.S. south          $         23,587   $         44,718   $         21,131
U.S. northeast      $         21,684   $         26,061   $          4,377
Corporate           $        (15,402)  $        (14,116)  $          1,286

Adjusted SG&A       $         34,964   $         50,152   $         15,188
----------------------------------------------------------------------------
Canada              $          8,449   $         15,547   $          7,098
U.S. south          $         10,232   $         17,433   $          7,201
U.S. northeast      $          6,814   $          7,499   $            685
Corporate           $          9,469   $          9,673   $            204

Adjusted EBITDA(A)  $         75,363   $        119,960   $         44,597
----------------------------------------------------------------------------
Canada              $         39,561   $         58,854   $         19,293
U.S. south          $         23,587   $         44,718   $         21,131
U.S. northeast      $         21,684   $         26,061   $          4,377
Corporate           $         (9,469)  $         (9,673)  $           (204)

                      Three months ended December 31
--------------------------------------------------------
                                2010             Change
--------------------------------------------------------
                                      (2010 as reported
                                           less 2009 as
                       (as reported)          reported)
--------------------------------------------------------

Revenues            $        429,879   $        167,417
--------------------------------------------------------
Canada              $        181,584   $         85,111
U.S. south          $        158,760   $         71,878
U.S. northeast      $         89,535   $         10,428

Operating expenses  $        255,261   $        103,126
--------------------------------------------------------
Canada              $        102,677   $         54,214
U.S. south          $         96,609   $         43,546
U.S. northeast      $         55,975   $          5,366

SG&A (as reported)  $         56,186   $         15,289
--------------------------------------------------------
Canada              $         16,509   $          8,060
U.S. south          $         17,433   $          7,201
U.S. northeast      $          7,499   $            685
Corporate           $         14,745   $           (657)

EBITDA(A)(as
 reported)          $        118,432   $         49,002
--------------------------------------------------------
Canada              $         62,398   $         22,837
U.S. south          $         44,718   $         21,131
U.S. northeast      $         26,061   $          4,377
Corporate           $        (14,745)  $            657

Adjusted SG&A       $         51,631   $         16,667
--------------------------------------------------------
Canada              $         16,509   $          8,060
U.S. south          $         17,433   $          7,201
U.S. northeast      $          7,499   $            685
Corporate           $         10,190   $            721

Adjusted EBITDA(A)  $        122,987   $         47,624
--------------------------------------------------------
Canada              $         62,398   $         22,837
U.S. south          $         44,718   $         21,131
U.S. northeast      $         26,061   $          4,377
Corporate           $        (10,190)  $           (721)

Segment Highlights (continued)


                           Year ended December 31
----------------------------------------------------------------------------
                                2009               2010             Change
----------------------------------------------------------------------------
                                                          (2010 holding FX
                                            (holding FX  constant with the
                                      constant with the        comparative
                                            comparative   period less 2009
                       (as reported)            period)       as reported)
----------------------------------------------------------------------------

Revenues            $      1,008,466   $      1,372,748   $        364,282
----------------------------------------------------------------------------
Canada              $        349,288   $        527,124   $        177,836
U.S. south          $        340,187   $        502,308   $        162,121
U.S. northeast      $        318,991   $        343,316   $         24,325

Operating expenses  $        588,104   $        809,011   $        220,907
----------------------------------------------------------------------------
Canada              $        178,147   $        286,248   $        108,101
U.S. south          $        209,279   $        306,903   $         97,624
U.S. northeast      $        200,678   $        215,860   $         15,182

SG&A (as reported)  $        136,846   $        184,040   $         47,194
----------------------------------------------------------------------------
Canada              $         30,497   $         45,079   $         14,582
U.S. south          $         37,999   $         53,141   $         15,142
U.S. northeast      $         28,076   $         30,012   $          1,936
Corporate           $         40,274   $         55,808   $         15,534

EBITDA(A)(as
 reported)          $        283,516   $        435,505   $         96,181
----------------------------------------------------------------------------
Canada              $        140,644   $        195,797   $         55,153
U.S. south          $         92,909   $        142,264   $         49,355
U.S. northeast      $         90,237   $         97,444   $          7,207
Corporate           $        (40,274)  $        (55,808)  $        (15,534)

Adjusted SG&A       $        129,913   $        128,232   $         38,695
----------------------------------------------------------------------------
Canada              $         30,497   $         45,079   $         14,582
U.S. south          $         37,999   $         53,141   $         15,142
U.S. northeast      $         28,076   $         30,012   $          1,936
Corporate           $         33,341   $         40,376   $          7,035

Adjusted EBITDA(A)  $        290,449   $        395,129   $        104,680
----------------------------------------------------------------------------
Canada              $        140,644   $        195,797   $         55,153
U.S. south          $         92,909   $        142,264   $         49,355
U.S. northeast      $         90,237   $         97,444   $          7,207
Corporate           $        (33,341)  $        (40,376)  $         (7,035)

                 Year ended December 31
--------------------------------------------------------
                                2010             Change
--------------------------------------------------------
                                      (2010 as reported
                                           less 2009 as
                       (as reported)          reported)
--------------------------------------------------------

Revenues            $      1,429,765   $        421,299
--------------------------------------------------------
Canada              $        584,141   $        234,853
U.S. south          $        502,308   $        162,121
U.S. northeast      $        343,316   $         24,325

Operating expenses  $        839,973   $        251,869
--------------------------------------------------------
Canada              $        317,210   $        139,063
U.S. south          $        306,903   $         97,624
U.S. northeast      $        215,860   $         15,182

SG&A (as reported)  $        192,865   $         56,019
--------------------------------------------------------
Canada              $         49,955   $         19,458
U.S. south          $         53,141   $         15,142
U.S. northeast      $         30,012   $          1,936
Corporate           $         59,757   $         19,483

EBITDA(A)(as
 reported)          $        396,927   $        113,411
--------------------------------------------------------
Canada              $        216,976   $         76,332
U.S. south          $        142,264   $         49,355
U.S. northeast      $         97,444   $          7,207
Corporate           $        (59,757)  $        (19,483)

Adjusted SG&A       $        175,966   $         46,053
--------------------------------------------------------
Canada              $         49,955   $         19,458
U.S. south          $         53,141   $         15,142
U.S. northeast      $         30,012   $          1,936
Corporate           $         42,858   $          9,517

Adjusted EBITDA(A)  $        413,826   $        123,377
--------------------------------------------------------
Canada              $        216,976   $         76,332
U.S. south          $        142,264   $         49,355
U.S. northeast      $         97,444   $          7,207
Corporate           $        (42,858)  $         (9,517)

Revenues

Gross revenue by service type

(prepared on a comparable basis)

The following tables compare gross revenues for the three months and year ended December 31, 2010 to the comparative period or year by service offering. These tables have been prepared on a "comparable basis", which includes WSI's results as if WSI's operations were combined with ours in the current and previously comparable quarter and year.


                               Three months ended December 31, 2010
----------------------------------------------------------------------------
                            Canada -
                            stated in    Canada -                     U.S. -
                         thousands of  percentage                 percentage
                             Canadian    of gross                   of gross
                              dollars     revenue           U.S.     revenue
----------------------------------------------------------------------------

Commercial              $      71,347        34.3  $      76,090        27.3
Industrial                     34,063        16.3         39,168        14.0
Residential                    32,847        15.7         60,322        21.6
Transfer and disposal          58,477        28.0         89,765        32.2
Recycling and other            11,870         5.7         13,642         4.9
----------------------------------------------------------------------------
Gross revenues                208,604       100.0        278,987       100.0
----------------------------------------------------------------------------

                               Three months ended December 31, 2009
----------------------------------------------------------------------------
                            Canada -
                            stated in    Canada -                     U.S. -
                         thousands of  percentage                 percentage
                             Canadian    of gross                   of gross
                              dollars     revenue           U.S.     revenue
----------------------------------------------------------------------------

Commercial              $      69,729        36.4  $      71,681        28.2
Industrial                     32,401        16.9         35,746        14.0
Residential                    32,081        16.8         53,312        20.9
Transfer and disposal          48,820        25.5         83,943        33.0
Recycling and other             8,379         4.4          9,955         3.9
----------------------------------------------------------------------------
Gross revenues                191,410       100.0        254,637       100.0
----------------------------------------------------------------------------
                                   Year ended December 31, 2010
----------------------------------------------------------------------------
                            Canada -
                            stated in    Canada -                     U.S. -
                         thousands of  percentage                 percentage
                             Canadian    of gross                   of gross
                              dollars     revenue           U.S.     revenue
----------------------------------------------------------------------------

Commercial              $     296,606        35.5  $     297,753        26.9
Industrial                    142,447        17.0        157,470        14.3
Residential                   130,960        15.6        229,228        20.8
Transfer and disposal         221,175        26.4        363,233        32.9
Recycling and other            46,006         5.5         55,984         5.1
----------------------------------------------------------------------------
Gross revenues                837,194       100.0      1,103,668       100.0
----------------------------------------------------------------------------

                                   Year ended December 31, 2009
----------------------------------------------------------------------------
                            Canada -
                            stated in    Canada -                     U.S. -
                         thousands of  percentage                percent-age
                             Canadian    of gross                   of gross
                              dollars     revenue           U.S.     revenue
----------------------------------------------------------------------------

Commercial              $     278,173        37.4  $     265,616        26.6
Industrial                    132,057        17.7        149,106        14.9
Residential                   123,008        16.5        207,337        20.8
Transfer and disposal         184,063        24.8        338,734        33.9
Recycling and other            27,148         3.6         38,218         3.8
----------------------------------------------------------------------------
Gross revenues                744,449       100.0        999,011       100.0
----------------------------------------------------------------------------

Gross revenue growth or decline components - expressed in percentages and excluding FX

(prepared on a comparable basis for 2010 only)

The tables below have been prepared on a "comparable basis" as outlined above. However, component percentages presented for 2009 have not been prepared on a comparable basis and accordingly do not include WSI's results.


                                  Three months ended    Three months ended
                                    December 31, 2010     December 31, 2009
----------------------------------------------------------------------------
                                     Canada      U.S.    Canada        U.S.
----------------------------------------------------------------------------

Price
 Core price                             2.4       1.0       3.2         1.8
 Fuel surcharges                        0.9       0.5      (0.6)       (2.2)
 Recycling and other                    0.7       1.0         -         0.6
----------------------------------------------------------------------------
 Total price growth                     4.0       2.5       2.6         0.2

Volume                                  2.3       1.3       0.3        (0.1)
----------------------------------------------------------------------------
Total organic gross revenue
 growth                                 6.3       3.8       2.9         0.1

Acquisitions, net of divestitures       2.7       5.8       0.4         1.9
----------------------------------------------------------------------------
Total gross revenue growth              9.0       9.6       3.3         2.0
----------------------------------------------------------------------------

                                          Year ended            Year ended
                                    December 31, 2010     December 31, 2009
----------------------------------------------------------------------------
                                     Canada      U.S.    Canada        U.S.
----------------------------------------------------------------------------

Price
 Core price                             3.1       2.1       3.2         2.2
 Fuel surcharges                        0.7       0.4      (1.0)       (2.6)
 Recycling and other                    0.6       1.6      (0.2)       (1.5)
----------------------------------------------------------------------------
 Total price growth (decline)           4.4       4.1       2.0        (1.9)

Volume                                  4.3       1.1      (0.6)       (2.3)
----------------------------------------------------------------------------
Total organic gross revenue
 growth (decline)                       8.7       5.2       1.4        (4.2)

Acquisitions, net of divestitures       3.8       5.6       1.5         1.9
----------------------------------------------------------------------------
Total gross revenue growth
 (decline)                             12.5      10.8       2.9        (2.3)
----------------------------------------------------------------------------

Three months ended

On a "comparable basis", prepared as if WSI's operations were combined with ours in the current and previously comparable quarter, our Canadian segment delivered price growth in every service line, excluding industrial. While industrial pricing was down comparatively, comparative volumes increased resulting in a net increase to gross revenue growth over the comparative period a year ago. As in the third quarter of 2010, higher organic gross revenue growth delivered by our existing Canadian operations was partially offset by a lower comparable performance from WSI's operations in Canada. The divestiture of certain assets in the current and previous quarter also resulted in a comparable decline in commercial volumes, as expected. However, higher comparable pricing in our commercial service line more than compensated for the volume decline attributable to asset divestitures. Comparable volume gains are the result of higher landfill volumes, new contract wins and strong organic growth. Other "tuck-in" acquisitions, FX, and higher fuel surcharges also contributed to the comparable increase.

With the exception of slightly lower pricing in our transfer and disposal service line, pricing and volumes were up comparably across all service lines in our U.S. south segment. While pricing was lower in our transfer and disposal service line, comparable volume gains more than offset this decline. Higher fuel surcharges and other "tuck-in" acquisitions contributed to the balance of growth in comparable gross revenues.

Gross revenues in our U.S. northeast segment increased as well. Excluding pricing in our residential service line, all of our service lines enjoyed higher price, or pricing that was largely unchanged, over the comparable period a year ago. The decline in residential pricing, while not significant, was due to lost business year to year which also contributed to lower volumes as well. Recycling volumes were also down slightly as were net transfer and disposal volumes, due in large part to weather. Higher comparative pricing more than offset the volume declines in each of these two service offerings and comparative volumes increased across all remaining business lines. Fuel surcharges remained flat comparatively, while "tuck-in" acquisitions contributed to the balance of gross revenue growth in the U.S. northeast.

Year ended

The increase in Canadian segment gross revenues is attributable to organic and other "tuck-in" acquisition growth. Similar to the three months ended, higher organic gross revenue growth delivered by our existing Canadian operations was partially offset by a lower comparable performance from WSI's Canadian operations. On a comparable basis, year-to-date pricing was up across all service lines, excluding residential. The decline in residential pricing was due largely to a contract win which commenced January 2010. As expected, residential volumes increased which produced a net benefit to gross revenue growth for this service line. As outlined above, divestitures have impacted comparable commercial volumes, but stronger year-to-date pricing produced comparable gross revenue gains. Fuel surcharges, FX, and commodity pricing has also contributed to the year-to-date increase.

On a year-to-date basis, U.S. south segment gross revenues increased on the back of strong pricing growth which grew across all service lines. All of our U.S. south service lines also delivered comparative volume growth. Other "tuck-in" acquisitions and fuel surcharges also contributed to gross revenue growth year over year.

On a year-to-date basis, gross revenue growth in our U.S. northeast segment benefited from stronger year over year pricing. Landfill pricing was the only service line that experienced a year-to-date decline. Attracting volumes at our landfills in combination with the mix of waste materials received is the primary cause for the pricing decline. The return of commodity pricing delivered a strong contribution to year-to-date gross revenue growth as did an increase in the volume of materials processed. Volume growth was most pronounced in our landfill and industrial service lines, but was partially offset by declines in all other service offerings. Acquisitions and marginally higher fuel prices also contributed to year-to-date gross revenue growth.

Operating expenses

Three months ended

The comparative increase is due to FX, our acquisition of WSI, other "tuck-in" acquisitions, and higher collected waste volumes in our pre-existing base business. In total, higher disposal, labour and vehicle operating and maintenance expenses, account for the largest components of the comparative increase. In addition, higher subcontract costs, insurance and higher commodity rebates, due to higher comparative commodity pricing, are the largest contributors to the balance of the period to period increase. The increase in commodity rebates was most notable in the U.S. northeast and Canada. At 59.4%, fourth quarter operating expenses as a percentage of reportable revenues is higher than the 58.0% achieved in the comparative period. While we have benefited from lower insurance costs as a percentage of reportable revenues, subcontract costs, repairs and maintenance and labour costs have risen when expressed as a percentage of reportable revenues due principally to the composition of revenues we acquired on our acquisition of WSI and other acquisitions completed in the year. As we acquire more collection companies and increase collection revenues, without increasing our compliment of landfill assets and landfill revenues, our operating margins will contract. Weather, in our U.S. northeast business, was also a contributing factor to higher operating expenses when expressed as a percentage of revenues.

Year ended

The comparative year to date increase is consistent with the reasons outlined above for the three months ended. At 58.7%, current year operating expenses as a percentage of reportable revenues is consistent with the 58.3% achieved in the prior year. We continue to integrate WSI with our existing operations with the goal of improving our operating effectiveness. We are satisfied that we are realizing the synergies we expected from the acquisition of WSI.

SG&A expenses

Three months ended

Excluding the impact of FX, the increase in SG&A expense is due to the acquisition of WSI, other "tuck-in" acquisitions and organic growth. The increase is primarily attributable to higher salaries, facility and other SG&A costs, which are due in large part to our acquisition of WSI and other "tuck-in" acquisitions.

Corporate SG&A includes certain executive costs, accounting, internal audit, treasury, investor relations, corporate development, environmental management, information technology, human resources and other administrative support functions. Corporate SG&A also includes transaction and related costs and fair value changes to stock options. While we experienced an increase in corporate SG&A costs resulting from our acquisition of WSI, due largely to higher salaries and facility and office costs, and higher fair value changes in stock options, the comparative decline in transaction and related costs, corporate reorganization costs, coupled with the recovery of professional fees incurred in our defense of an anti-trust lawsuit, more than offset these increases. As a percentage of reportable revenues, SG&A expense, expressed on an adjusted basis, declined comparably. Rationalizing personnel and operating locations, resulting principally from the acquisition of WSI, is the primary reason for the comparative improvement. We continue to integrate WSI with our existing operations with the goal of reducing SG&A expense. We are satisfied that we are realizing the synergies we expected from the acquisition of WSI and we expect to realize additional synergies in the coming year.

Year ended

As outlined above for the three months ended, the increase in SG&A expense is due to the acquisition of WSI, other "tuck-in" acquisitions, organic growth and FX. The increase is primarily attributable to salaries, which is due in part to fair value changes in stock options. Facility and other SG&A cost increases also contributed to the year over year increase, partially offset by lower fourth quarter corporate reorganization costs and the recovery of certain professional fees.

Free cash flow(B)

Purpose and objective

The purpose of presenting this non-GAAP measure is to align our disclosure with other U.S. publicly listed companies, in our industry, and to provide investors and analysts an additional measure of our value and liquidity. We use this non-GAAP measure to assess our performance relative to other U.S. publicly listed companies and to assess the availability of funds for growth investment and debt repayment.

In 2009, our calculation of free cash flow(B) did not deduct for acquisition and related costs or non-recurring costs. Accordingly, comparative free cash flow(B) amounts have been adjusted to conform to the current period or year's presentation.

Free cash flow(B) - cash flow approach


                         Three months ended                      Year ended
                                December 31                     December 31
----------------------------------------------------------------------------
                   2010      2009    Change       2010       2009    Change
----------------------------------------------------------------------------

Cash generated
 from
 operating
 activities
(from
 statement of
 cash flows)   $120,667  $ 63,620  $ 57,047  $ 293,861  $ 256,269  $ 37,592
----------------------------------------------------------------------------

Operating and
 investing
Reorganization
 costs (non-
 recurring
 capital tax)         -     1,315    (1,315)         -      1,315    (1,315)
Stock option
 expense          2,166     1,006     1,160      8,336      2,006     6,330
Acquisition
 and related
 costs            2,389         -     2,389      8,563          -     8,563
Restructuring
 expenses         1,388     3,612    (2,224)     5,180      3,612     1,568
Conversion
 costs                -        90       (90)         -        298      (298)
Other expenses    2,566        53     2,513      3,210        162     3,048
Changes in
 non-cash
 working
 capital items  (29,155)  (11,828)  (17,327)    14,612    (27,304)   41,916
Capital and
 landfill
 asset
 purchases      (58,030)  (34,401)  (23,629)  (142,641)  (122,276)  (20,365)

Financing
Interest on
 long-term
 debt - high
 yield
 defeasance
 interest             -         -         -      1,663          -     1,663
Financing and
 landfill
 development
 costs (net of
 non-cash
 portion)             -         -         -       (290)       (77)     (213)
Purchase of
 restricted
 shares               -         -         -     (1,241)      (172)   (1,069)
Net realized
 foreign
 exchange loss       33        38        (5)        47        276      (229)
----------------------------------------------------------------------------
Free cash
 flow(B)       $ 42,024  $ 23,505  $ 18,519  $ 191,300  $ 114,109  $ 77,191
----------------------------------------------------------------------------

Free cash flow(B) - adjusted EBITDA(A) approach


                         Three months ended                      Year ended
                                December 31                     December 31
----------------------------------------------------------------------------
                   2010      2009    Change       2010       2009    Change
----------------------------------------------------------------------------

Adjusted
 EBITDA(A)     $122,987  $ 75,363  $ 47,624  $ 413,826  $ 290,449  $123,377
----------------------------------------------------------------------------

Restricted
 share expense      579       404       175      1,977      1,485       492
Purchase of
 restricted
 shares               -         -         -     (1,241)      (172)   (1,069)
Capital and
 landfill
 asset
 purchases      (58,030)  (34,401)  (23,629)  (142,641)  (122,276)  (20,365)
Landfill
 closure and
 post-closure
 expenditures    (2,588)   (2,181)     (407)    (5,749)    (7,145)    1,396
Landfill
 closure and
 post-closure
 cost
 accretion
 expense          1,035       808       227      3,827      3,130       697
Interest on
 long-term
 debt           (14,822)   (7,979)   (6,843)   (48,786)   (34,225)  (14,561)
Interest on
 long-term
 debt - high
 yield
 defeasance
 interest             -         -         -      1,663          -     1,663
Non-cash
 interest
 expense          1,262       681       581      4,672      2,902     1,770
Current income
 tax expense     (8,399)   (9,190)      791    (36,248)   (20,039)  (16,209)
----------------------------------------------------------------------------
Free cash
 flow(B)       $ 42,024  $ 23,505  $ 18,519  $ 191,300  $ 114,109  $ 77,191
----------------------------------------------------------------------------

Three months ended

Free cash flow(B) increased over the comparative year ago period. The acquisition of WSI contributed to the growth in free cash flow(B) and adjusted EBITDA(A) that we enjoyed comparatively, as did FX. In addition, we realized significant improvements to free cash flow(B) and adjusted EBITDA(A) resulting from strong organic growth and other "tuck-in" acquisitions. Higher debt levels resulting from the acquisition of WSI and higher interest rates in Canada and the U.S. partially offset adjusted EBITDA(A) improvements. Similarly, higher capital and landfill asset purchases, due in large part to the acquisition of WSI and other "tuck-in" acquisitions, partially offset the increase in adjusted EBITDA(A). Cash taxes declined comparatively. The comparative decline is due to refunds received in our U.S. business partially offset by higher Canadian cash taxes. WSI's Canadian operations had no meaningful loss carryforwards to shelter income subject to tax.

Year ended

For the year ended, free cash flow(B) increased. The WSI acquisition, other "tuck-in" acquisitions, organic growth and FX all contributed to the increase in free cash flow(B). Strong revenue growth contributed to the increase in adjusted EBITDA(A), which was partially offset by higher interest expense and higher current income tax expense. The reasons for these changes are largely consistent with those outlined above for the three months ended.

Capital and landfill purchases

Capital and landfill purchases characterized as replacement and growth expenditures are as follows:


               Three months ended December 31        Year ended December 31
----------------------------------------------------------------------------
                     2010      2009    Change      2010      2009    Change
----------------------------------------------------------------------------

Replacement      $ 43,419  $ 24,580  $ 18,839  $100,578  $ 73,674  $ 26,904
Growth             14,611     9,821     4,790    42,063    48,602    (6,539)
----------------------------------------------------------------------------
Total            $ 58,030  $ 34,401  $ 23,629  $142,641  $122,276  $ 20,365
----------------------------------------------------------------------------

Capital and landfill purchases - replacement

Capital and landfill purchases characterized as "replacement" expenditures represent cash outlays to sustain current cash flows and are funded from free cash flow(B). Replacement expenditures include the replacement of existing capital assets and all construction spending at our landfills.

Three months ended

Excluding the impact of FX, replacement expenditures increased. The increase is principally attributable to the Canadian business. Replacement land and building expenditures resulting from the integration of certain locations coupled with higher comparative vehicle spending due to the timing of spend and replacement of ageing WSI acquired equipment are the primary reasons for the increase. U.S. replacement expenditures also increased, due largely to the WSI acquisition and comparative differences in the timing of spending.

Year ended

The reasons for the increase in year-to-date replacement spending are consistent with those outlined above for the three months ended.

Capital and landfill purchases - growth

Capital and landfill purchases characterized as "growth" expenditures represent cash outlays to generate new or future cash flows and are generally funded from free cash flow(B). Growth expenditures include capital assets, including facilities (new or expansion), to support new contract wins and organic business growth.

Three months ended

Excluding the impact of FX, growth expenditures increased. The increase is solely attributable to our U.S. segment as our Canadian business saw a comparative quarterly decline. The Canadian segment decline is the result of lower comparable vehicle purchases resulting from the timing of contract wins. The U.S. segment increase is due in large part to infrastructure spending, namely buildings and land.

Year ended

Fewer comparative contract wins, most notably in our U.S. business, is the primary reason for the decline in year-to-date growth expenditures.

Readers are reminded that revenue, adjusted EBITDA(A), and cash flow contributions realized from growth expenditures will materialize over future periods.

Long-term debt

(all amounts are in thousands of U.S. dollars, unless otherwise stated)

Summary details of our long-term debt facilities at December 31, 2010 are as follows:


                                                   Letters of
                                                  credit (not
                                                  reported as
                                               long-term debt
                                                       on the
                      Available       Facility   Consolidated      Available
                        lending          drawn Balance Sheet)       capacity
----------------------------------------------------------------------------
Canadian long-
 term debt
 facilities -
 stated in
 Canadian
 dollars
Senior secured
 debenture,
 series B         $      58,000  $      58,000  $           -  $           -
Revolving credit
 facility         $     525,000  $     325,000  $      53,355  $     146,645

U.S. long-term
 debt facilities
 - stated in
 U.S. dollars
Revolving credit
 facility         $     950,000  $     761,000  $     139,901  $      49,099
Variable rate
 demand solid
 waste disposal
 revenue bonds
 ("IRBs")(1)      $     194,000  $     109,000  $           -  $      85,000
Other             $       4,580  $       4,580  $           -  $           -

Note:
(1) Drawings on IRB availability at floating rates of interest, will, under
    the terms of the underlying agreement, typically be used to repay
    revolving credit advances on our U.S. facility. IRB drawings at floating
    rates of interest, requires us to issue letters of credit for an amount
    equal to the IRB amounts drawn.

Funded debt to EBITDA (as defined and calculated in accordance with our Canadian and U.S. long-term debt facilities)

At December 31, 2010, funded long-term debt to EBITDA is as follows:


                                     December 31, 2010     December 31, 2009
----------------------------------------------------------------------------
                                     Canada       U.S.     Canada       U.S.
----------------------------------------------------------------------------

Funded debt to EBITDA                  1.91       3.19       1.92       2.56
Funded debt to EBITDA maximum          3.00       4.00       2.75       4.00

Changes to long-term debt occurring in conjunction with the WSI acquisition

Closing Agreements

On June 23, 2010, we entered into a Closing Agreement with the credit parties to our Canadian facility. The purpose of entering into this agreement was to secure the terms and conditions of the Canadian facility and certain arrangements regarding funding of the WSI acquisition at closing. As consideration for entering into this agreement, we incurred a ticking fee equal to 72.5 basis points per annum calculated on the total C$525,000 commitment available under the Canadian facility. The ticking fee was calculated daily and was payable from the date of the agreement to the earlier of the Canadian facility being executed or 60 days from the execution date of the Closing Agreement.

On June 14, 2010, we entered into a Closing Agreement with the credit parties to our U.S. facility. The purpose of entering into this agreement is consistent with the purpose outlined above for our Canadian facility. As consideration for entering into this agreement, we incurred a ticking fee equal to 50 basis points per annum calculated on the total $950,000 commitment available, at that time, under the U.S. facility. The ticking fee was calculated daily and was payable from the date of the agreement to the earlier of the execution of the U.S. facility or July 30, 2010.

Canadian facility

On July 2, 2010, in connection with the closing of the WSI acquisition, the Canadian facility became effective. Monies available from the Canadian facility were used to repay WSI's outstanding Canadian indebtedness on closing and are available for general corporate purposes, including permitted acquisitions, subject to certain restrictions. Entering into the Canadian facility increased our availability from C$305,000 to C$525,000 and increased the total additional availability under the facility (the "accordion feature") from C$45,000 to C$125,000. All committed monies under the Canadian facility are revolving. In addition, the maturity date was extended from May 30, 2011 to July 2, 2014 and certain covenants were amended to reflect the financial condition and operations of the combined Canadian companies. Financial covenant amendments included an increase in the maximum funded debt to EBITDA ratio, as defined and calculated in accordance with the terms of the Canadian facility, from 2.75 times to 3.0 times. The funded debt to EBITDA ratio covenant expands to a maximum of 3.25 times for a period of two quarters following the completion of an acquisition which exceeds C$75,000.

Pricing on advances drawn under the facility increased by 125 basis points when our funded debt to EBITDA ratio is in excess of 2.0 times, and by 100 basis points when our funded debt to EBITDA ratio is below 2.0 times. The Canadian facility also introduced new pricing layers for funded debt to EBITDA positions below 1.0 times and in excess of 2.5 times. Pricing ranges from 112.5 to 237.5 basis points over bank prime for borrowings on prime and 212.5 to 337.5 basis points over bankers' acceptances ("BAs") for borrowings on BAs. Pricing on financial letters of credit increased by similar amounts and pricing ranges from 212.5 basis points to 337.5 basis points. Standby fees increased by 32.5 basis points, and range from 55 to 85 basis points, while non-financial letters of credit increased by approximately 82.5 basis points.

Security under the Canadian facility remained largely unchanged from the previous facility, and represents a first priority perfected security interest over all personal and real property of the Canadian operating companies and a pledge of the Canadian operating entities equity held by the Canadian parent.

On July 2, 2010, advances under the Canadian facility were C$348,000 and total letters of credit outstanding amounted to C$52,316. Available capacity under the facility, excluding the accordion, at July 2, 2010 was C$124,684. In addition, our funded debt to EBITDA ratio on closing (as defined and calculated in accordance with our Canadian facility) was 2.08 times.

December 31, 2010 update

On December 31, 2010, advances under the Canadian facility were C$325,000 and total letters of credit amounted to approximately C$53,400. Available capacity under the facility at December 31, 2010, excluding the accordion, was approximately C$146,600 and our funded debt to EBITDA ratio (as defined and calculated in accordance with our Canadian facility) was 1.91 times.

Canadian Trust Indenture

On July 2, 2010, we entered into the Fifth Amended and Restated Trust Indenture (the "trust indenture"). The purpose of entering into the trust indenture was to permit us to repay WSI's outstanding Canadian indebtedness with accommodations available under the Canadian facility. The amount drawn, maturity, pricing, security and significant terms and covenants in the trust indenture were largely unchanged. Covenant modifications generally reflected the financial condition and operations of the combined Canadian companies and were aligned with changes to the Canadian facility. The financial covenant, funded debt to EBITDA, (as defined and calculated in accordance with the terms of the trust indenture) and referred to above in the Canadian facility section, was similarly modified in the trust indenture. While pricing remained unchanged, pricing was modified to allow for an additional charge should our credit quality deteriorate. Credit quality deterioration, includes, but is not limited to, a rating agency downgrade below investment grade and a funded debt to EBITDA ratio, as defined and calculated in accordance with the terms of the trust indenture, which exceeds 2.75 times.

U.S. facility

On July 2, 2010, our U.S. facility became effective in connection with the closing of the WSI acquisition. Monies available from the U.S. facility were used to repay WSI's outstanding U.S. indebtedness on closing and are available for permitted acquisitions, subject to certain restrictions, capital expenditures, refinancing existing indebtedness, working capital, letters of credit and for general corporate purposes. Entering into the U.S. facility increased our availability from $783,500 to $950,000 and increased the total additional availability under the facility (the "accordion feature") from $36,500 to $300,000. All committed monies under the U.S. facility are revolving. In addition, the maturity date was extended from January 21, 2012 to July 2, 2014 and certain covenants were amended to reflect the financial condition and operations of the combined U.S. companies. Financial covenants under the U.S. facility remain principally unchanged and include a maximum total funded debt to rolling four-quarter EBITDA ratio of 4.0 times, a minimum rolling four-quarter EBITDA to interest expense ratio of 2.5 times, a capital expenditure maximum of 1.1 times actual depreciation and landfill depletion expense for any fiscal year and precludes IESI from paying dividends if their funded debt to EBITDA ratio exceeds 3.9 times, all of which are defined and calculated in accordance with the terms of the U.S. facility. The U.S. facility requires that we maintain interest rate hedges at fixed rates for at least 40% of the total funded debt, as defined therein. This requirement is unchanged from the conditions included in the preceding facility.

Pricing on advances drawn increased comparatively by 125 basis points for LIBOR rate advances at all pricing levels and by 150 to 200 basis points for bank prime advances. Pricing ranges from 250 to 325 basis points over LIBOR for borrowings on LIBOR and 150 to 225 basis points over bank prime for prime rate advances and interest is payable quarterly in arrears. Pricing on financial letters of credit increased by similar amounts and pricing ranges from 212.5 basis points to 337.5 basis points. Standby fees were largely unchanged and range from 37.5 to 62.5 basis points, while letters of credit increased by approximately 125 basis points.

Security under the U.S. facility remained relatively unchanged from the previous facility, and represents a first priority perfected security interest over all personal and real property of the U.S. operating companies and a pledge of the U.S. operating entities equity held by the U.S. parent.

On July 2, 2010, advances under the U.S. facility were $650,000 and total letters of credit outstanding amounted to $139,683. Available capacity under the facility, excluding the accordion, at July 2, 2010 was $160,317. In addition, our funded debt to EBITDA on closing (as defined and calculated in accordance with our U.S. facility) was 3.24 times.

December 31, 2010 update

In December 2010, we exercised a portion of the accordion feature available on our U.S. facility which increased the size of the U.S. credit facility by $127,500 to $1,077,500 which became effective January 13, 2011. The accordion feature available on the U.S. facility declined by a similar amount. Accordingly, total remaining additional availability under the facility, assuming an effective date of December 31, 2010, is $172,500. Since we exercised a portion of the accordion feature, we are not required to maintain interest rate hedges at fixed rates for at least 40% of the total funded debt for a period not to extend beyond March 31, 2011. We are however required to maintain interest rate hedges at fixed rates of interest for at least 30% of total funded debt.

On December 31, 2010, advances under the U.S. facility were $761,000 and total letters of credit amounted to approximately $139,900. Available capacity under the facility, excluding the accordion, was approximately $49,100 and our funded debt to EBITDA ratio (as defined and calculated in accordance with our U.S. facility) was 3.19 times.

Other

In connection with the WSI acquisition, we assumed various notes which included a secured note that was originally payable to WCA of Florida LLC ("WCA") and subsequently assigned to Credit Suisse. The note had an original issue date of June 29, 2007 and was originally issued for $10,500. The note is non-interest bearing and requires payments of $125 per month until its maturity in June 2014. The note was entered into as part of a transaction between WSI and WCA to acquire certain WCA assets in Florida and to sell certain WSI operations in Texas. At December 31, 2010, the principal value of the note is $4,580.

In addition, we assumed a note payable with an original issue date of June 14, 2002 and issue amount of $3,500. The note bore interest at 6.678% and was payable in 180 equal monthly payments of approximately $31, or the equivalent of $370 annually. The note matured on June 14, 2017 and the balance outstanding at July 2, 2010 was $2,064. The note was unsecured and was repaid in the third quarter of 2010.

We also assumed a note payable under a financing arrangement for a piece of equipment purchased in 2006. At closing, the total remaining payments under this note amounted to $38. The note was repaid in the third quarter of 2010.

Long-term debt to pro forma adjusted EBITDA(A)

On the closing of the WSI acquisition, and including other completed acquisitions, our pro forma adjusted EBITDA(A) ratio prepared on a combined basis, assuming FX parity, is approximately 2.5 times.

Definitions of Adjusted EBITDA and Free cash flow

(A) All references to "Adjusted EBITDA" in this press release are to revenues less operating expense and SG&A reported on the consolidated statement of operations and comprehensive income and further exclude certain non-operating or non-recurring SG&A expenses. Adjusted EBITDA excludes some or all of the following: "certain SG&A expenses, restructuring expenses, amortization, net gain or loss on sale of capital and landfill assets, interest on long-term debt, net foreign exchange gain or loss, net gain or loss on financial instruments, conversion costs, other expenses, income taxes and net income or loss from equity accounted investee". Adjusted EBITDA is a term used by us that does not have a standardized meaning prescribed by U.S. GAAP and is therefore unlikely to be comparable to similar measures used by other issuers. Adjusted EBITDA is a measure of our operating profitability, and by definition, excludes certain items as detailed above. These items are viewed by us as either non-cash (in the case of amortization, net gain or loss on financial instruments, net foreign exchange gain or loss, deferred income taxes and net income or loss from equity accounted for investee) or non-operating (in the case of certain SG&A expenses, restructuring expenses, net gain or loss on sale of capital and landfill assets, interest on long-term debt, conversion costs, other expenses, and current income taxes). Adjusted EBITDA is a useful financial and operating metric for us, our Board of Directors, and our lenders, as it represents a starting point in the determination of free cash flow(B). The underlying reasons for the exclusion of each item are as follows:

Certain SG&A expenses - SG&A expense includes certain and non-recurring, expenses. These expenses include transaction costs related to acquisitions, fair value adjustments attributable to stock options and corporate reorganization expense. These expenses are not considered an expense indicative of continuing operations. Certain SG&A costs represent a different class of expense than those included in adjusted EBITDA.

Restructuring expenses - restructuring expenses includes costs to integrate various operating locations with our own, exiting certain property and building and office leases, employee severance and employee relocation costs incurred in connection with our acquisition of WSI. These expenses are not considered an expense indicative of continuing operations. Accordingly, restructuring expenses represent a different class of expense than those included in adjusted EBITDA.

Amortization - as a non-cash item amortization has no impact on the determination of free cash flow(B).

Net gain or loss on sale of capital and landfill assets - proceeds from the sale of capital and landfill assets are either reinvested in additional or replacement capital or landfill assets or used to repay revolving credit facility borrowings.

Interest on long-term debt - interest on long-term debt is a function of our debt/equity mix and interest rates; as such, it reflects our treasury/financing activities and represents a different class of expense than those included in adjusted EBITDA.

Net foreign exchange gain or loss - as non-cash items, foreign exchange gains or losses have no impact on the determination of free cash flow(B).

Net gain or loss on financial instruments - as non-cash items, gains or losses on financial instruments have no impact on the determination of free cash flow(B).

Conversion costs - conversion costs represent professional fees incurred on the Fund's conversion from an income trust to a corporation and its eventual wind-up. These expenses are not considered an expense indicative of continuing operations. Conversion costs represent a different class of expense than those included in adjusted EBITDA.

Other expenses - other expenses typically represent amounts paid to certain management of acquired companies who are retained by us post acquisition and amounts paid to certain executives in respect of acquisitions successfully completed. These expenses are not considered an expense indicative of continuing operations. Accordingly, other expenses represent a different class of expense than those included in adjusted EBITDA.

Income taxes - income taxes are a function of tax laws and rates and are affected by matters which are separate from our daily operations.

Net income or loss from equity accounted investee - as a non-cash item, net income or loss from our equity accounted investee has no impact on the determination of free cash flow(B).

Adjusted EBITDA should not be construed as a measure of income or of cash flows. The reconciling items between adjusted EBITDA and net income are detailed in the consolidated statement of operations and comprehensive income or loss beginning with operating income before restructuring expenses, amortization and net gain or loss on sale of capital and landfill assets and ending with net income and includes certain adjustments for expenses recorded to SG&A which management views as not indicative of continuing operations. A reconciliation between operating income and adjusted EBITDA is provided below. Adjusted operating income and adjusted net income are also presented below.


                             Three months ended
                                    December 31      Year ended December 31
----------------------------------------------------------------------------
                             2010          2009          2010          2009
----------------------------------------------------------------------------

Operating income      $    54,814   $    33,500   $   184,495   $   127,012
Transaction and
 related costs - SG&A       2,389         3,612         8,563         3,612
Fair value movements
 in stock options -
 SG&A                       2,166         1,006         8,336         2,006
Corporate
 reorganization
 expense - SG&A                 -         1,315             -         1,315
Restructuring
 expenses                   1,388             -         5,180             -
----------------------------------------------------------------------------
Adjusted operating
 income                    60,757        39,433       206,574       133,945
----------------------------------------------------------------------------
Net gain or loss on
 sale of capital and
 landfill assets              (33)          (70)         (414)         (198)
Amortization               62,263        36,000       207,666       156,702
----------------------------------------------------------------------------
Adjusted EBITDA       $   122,987   $    75,363   $   413,826   $   290,449
----------------------------------------------------------------------------

Net income            $    21,683   $     9,875   $    82,169   $    53,728
Transaction and
 related costs - SG&A       2,389         3,612         8,563         3,612
Fair value movements
 in stock options -
 SG&A                       2,166         1,006         8,336         2,006
Corporate
 reorganization
 expense - SG&A                 -         1,315             -         1,315
Restructuring
 expenses                   1,388             -         5,180             -
Interest on long-term
 debt                           -             -         2,409             -
Net gain or loss on
 financial
 instruments               (2,245)         (696)       (5,493)       (1,562)
Conversion costs                -            90             -           298
Other expenses              2,566            53         3,210           162
Net income tax
 expense or recovery       (1,129)         (216)       (3,398)           32
----------------------------------------------------------------------------
Adjusted net income   $    26,818   $    15,039   $   100,976   $    59,591
----------------------------------------------------------------------------

(B) We have adopted a measure called "free cash flow" to supplement net income or loss as a measure of operating performance. Free cash flow is a term which does not have a standardized meaning prescribed by U.S. GAAP, is prepared before dividends declared, and is therefore unlikely to be comparable to similar measures used by other issuers. The objective of presenting this non-GAAP measure, however, is to provide similar disclosures to other U.S. publicly listed companies in the waste industry. We use this non-GAAP measure to assess our performance relative to other publically listed companies and to assess the availability of funds for growth investment and debt repayment. All references to "free cash flow" in this press release have the meaning set out in this note.

Forward-Looking Statements

This communication includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. These forward-looking statements may include, without limitation, IESI-BFC Ltd.'s expectations with respect to: the synergies, efficiencies, and capitalization and anticipated financial impacts of the WSI acquisition.

These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from the expected results. Most of these factors are outside our control and difficult to predict. The following factors, among others, could cause or contribute to such material differences: the ability to realize the expected synergies resulting from the WSI acquisition in the amounts or in the timeframe anticipated; and the ability to integrate WSI's businesses into those of IESI-BFC in a timely and cost-efficient manner. Additional factors that could cause IESI-BFC's results to differ materially from those described in the forward-looking statements can be found in the 2009 Annual Report on Form 10-K for WSI, and in IESI-BFC's 2009 Annual Report on Form 40-F, Registration Statement on Form F-10, as amended, and Registration Statement on Form F-4, each of which are filed with the SEC and available at the SEC's Internet web site (www.sec.gov), and IESI-BFC's 2009 Annual Information Form filed with the Ontario Securities Commission which is available at the SEDAR web site (www.sedar.com). IESI-BFC cautions that the foregoing list of factors is not exclusive. All subsequent written and oral forward-looking statements concerning IESI-BFC, the WSI acquisition or other matters and attributable to IESI-BFC or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. IESI-BFC does not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this communication, except as required by law.

About IESI-BFC Ltd.

IESI-BFC Ltd., through its subsidiaries, is one of North America's largest full-service waste management companies, providing non-hazardous solid waste collection and landfill disposal services to commercial, industrial, municipal and residential customers in eleven states and the District of the Columbia in the U.S., and six Canadian provinces. Its major brands, IESI, BFI Canada and WSI, are leaders in their markets, serving customers with vertically integrated collection and disposal assets. IESI-BFC's shares are listed on the New York and Toronto Stock Exchanges under the symbol BIN.

To find out more about IESI-BFC, visit its website at www.iesi-bfc.com.

Management will hold a conference call on Wednesday, February 23, 2011, at 8:00 a.m. (ET) to discuss results for the three months and year ended December 31, 2010. Participants may listen to the call by dialling 1-888-300-0053, conference ID 40113567, at approximately 7:50 a.m. (ET). International or local callers should dial 647-427-3420. The call will also be webcast live at www.streetevents.com and at www.iesi-bfc.com.

A replay will be available after the call until Wednesday, March 9, 2011, at midnight, and can be accessed by dialling 1-800-642-1687, conference code 40113567. International or local callers can access the replay by dialling 706-645-9291. The audio webcast will also be archived at www.streetevents.com and www.iesi-bfc.com.

For more information, contact:
IESI-BFC Ltd.
Chaya Cooperberg
Director, Investor Relations and Corporate Communications
(905) 532-7517
chaya.cooperberg@bficanada.com.
www.iesi-bfc.com.

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