GFL Environmental Inc. Provides Update On 2024 Capital Allocation Strategy
Portfolio Pulse from Benzinga Newsdesk
GFL Environmental Inc. (NYSE:GFL) outlined its 2024 capital allocation strategy, focusing on sustainability investments and M&A to densify its footprint. The company plans to invest $250-$300 million in renewable natural gas projects and infrastructure under EPR legislation, and $600-$650 million in M&A within existing geographies. Total growth investments will not exceed $900 million, in addition to normal capital expenditures of $850-$900 million. These investments are expected to generate $80-$100 million of incremental Adjusted EBITDA by 2026. GFL's first RNG facility is operational, with more projects coming online from Q4 2024 to 2026. The company aims to achieve at least $2.2 billion of Adjusted EBITDA in 2024 and reduce leverage to the mid 3's, with growth investments adding 20 basis points to year-end Net Leverage, targeting between 3.65x and 3.85x.
November 29, 2023 | 1:53 pm
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GFL Environmental Inc. is set to invest heavily in sustainability and M&A for 2024, with a total growth investment cap of $900 million. The company expects these investments to contribute significantly to its EBITDA and is committed to reducing leverage, targeting a Net Leverage of 3.65x to 3.85x by year-end.
The announcement of GFL's capital allocation strategy for 2024 indicates a clear path for growth and a commitment to sustainability, which is likely to be viewed positively by investors. The focus on renewable natural gas projects and M&A to densify their footprint aligns with current market trends favoring environmental responsibility and strategic growth. The expected increase in Adjusted EBITDA and the company's commitment to reducing leverage should instill confidence in investors, potentially leading to a positive short-term impact on the stock price.
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