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In 2019, we continued our focus on optimizing our traditional solid waste business, developing our people and investing in technology to better serve our customers. We reported revenues of $15.5 billion, compared with $14.9 billion in 2018. Strong results demonstrate that we are investing in the right areas.
Adjusted Operating EBITDA Margin1, 3
Adjusted operating EBITDA margin increased 10 basis points.4
- 1 Non-GAAP measures. See below for additional information and a link to reconciliations of these measures.
- 2 Adjusted Operating Margin is calculated by dividing Adjusted Income from Operations by Revenue, before rounding.
- 3 Operating EBITDA is defined as income from operations before depreciation and amortization.
- 4 A basis point is one-hundredth of 1 percent.
Adjusted Income from Operations, Adjusted Operating Margin, Adjusted Operating EBITDA, Adjusted Operating EBITDA Margin, and Adjusted Earnings Per Diluted Share (Adjusted EPS) exclude certain items affecting comparability of our results and are not defined by generally accepted accounting principles (GAAP). We believe that non-GAAP measures provide useful information to investors by excluding items the company does not believe reflect our fundamental business performance and/or are not representative or indicative of our results of operations.
Free Cash Flow is also a non-GAAP measure. We discuss Free Cash Flow because we believe it is indicative of the company’s ability to pay its quarterly dividends, repurchase common stock, fund acquisitions and other investments and, in the absence of refinancing, repay its debt obligations. However, the use of Free Cash Flow as a liquidity measure has material limitations because it excludes certain expenditures that are required or that the company has committed to, such as declared dividend payments and debt service requirements. The company defines Free Cash Flow as net cash provided by operating activities, less capital expenditures, plus proceeds from divestitures of businesses and other assets (net of cash divested).
Non-GAAP measures should not be considered a substitute for financial measures presented in accordance with GAAP. Operating EBITDA and Free Cash Flow may not be comparable to similarly titled measures reported by other companies. For quantitative reconciliations of non-GAAP measures to the most comparable measure calculated in accordance with GAAP, please see the financial tables accompanying Waste Management’s press release dated February 13, 2020, announcing full-year 2019 earnings and comparisons to 2018.