Win Waste Innovation Holdings Inc.

The stable outlook reflects our view that pro forma leverage is high but manageable and the financial profile will remain highly leveraged. It also reflects our expectation that the company will maintain low free operating cash flow (FOCF) over the near term. We could lower the ratings over the next 12 months if: Leverage increases above 5.5x consistently. We believe this could happen if operating performance suffers, the company engages in a more aggressive financial policy than contemplated, or recent one-time expenses continue; or FOCF is negative, increasing the reliance on its revolving credit facility and narrowing liquidity. We would consider an upgrade over the next 12 months if: The company reduces debt leverage well below 4.5x and commits to

...The company operates within the Northeast U.S. and southern Florida markets, which we view as attractive given exceptionally high tipping fees. It also benefits from shrinking landfill capacity given heavy environmental regulations limiting expansion. We view the business favorably given diverse revenue streams and a higher internalization rate. The company has favorable EBITDA margins. WIN Waste Innovations Holdings Inc. is a midsize regional player competing against other regional waste players alongside large national companies, in our opinion. We expect the company to maintain attractive EBITDA margins given the contracted nature of its revenue across various business lines. However, we do not expect meaningful organic growth given its focused position in the overall waste market. The financial risk profile is highly leveraged with S&P Global Ratings-adjusted total debt to EBITDA above 5x. The company paid a distribution to its owner (an affiliate of Macquarie Infrastructure and Real...

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