by Timothy McQuiston Vermont Business Magazine With its annual shareholders meeting a week from Friday, Casella Waste Systems, Inc is muscling up to fend off one of its investors in a shareholders proxy fight that could result in Chairman and CEO John Casella being removed from the board of directors. The annual shareholders meeting is November 6. In that effort, Casella has been supported recently by two independent advisory firms and an improved third quarter 2015 financial report released last week, which showed an increase in revenues and earnings.JCP Investment Management, LLC, a small investment firm based in Houston, TX, holds just over a 5 percent stake in the Vermont-based firm. It said it wants to replace the three board members up for re-election with three independent members of its choosing “because we are dedicated to maximizing shareholder value and improving corporate governance at Casella and we are confident that enhancing the Board is a critical first step towards these goals.”Casella, the solid waste and recycling company based in Rutland, has released financial results that it hopes will ensure that shareholders will elect the slate of directors as nominated by its board.JCP Group is conducting a proxy contest and is seeking the election at the 2015 Annual Meeting of two director candidates in opposition to the director nominees unanimously recommended by the Casella board. Among those up for re-election this year’s is Chairman and CEO John Casella.Casella has found support from Institutional Shareholder Services Inc, an independent proxy advisory firm, which has issued a report recommending that Casella stockholders vote the WHITE proxy card FOR ALL three of Casella’s director-nominees – John W Casella, William P Hulligan and James E O’Connor – standing for election. ISS’ clients include institutional investors, mutual funds, pension funds and other fiduciaries.ISS noted in its conclusion that JCP had not made a compelling case that additional change to Casella’s Board is needed and that votes for the Casella Board’s nominees on the WHITE proxy card are warranted.Additionally, ISS highlighted the significant and numerous positive changes that have already occurred at Casella. In particular, ISS took note of the refreshment of the Casella Board of Directors that has taken place, recognizing that four new directors have been added to the Casella Board since 2008. ISS noted:“The two most recent additions [William P Hulligan and James E O’Connor], both within the past year, appear to reflect the board’s commitment to chart a new course, in part, by adding credible industry expertise to the independent directors.”ISS also took note of the significant progress and momentum Casella has achieved in executing on its strategy, strengthening its management team, simplifying and streamlining its business, reducing its exposure to risk, improving its financial performance and positioning Casella for long-term growth and profitability. ISS noted that:“the current board appears to have made meaningful effort to put the company back onto a more promising path, including through reshuffling management, reassessing pricing structures, divesting underperforming assets, cost controls and focus on operational efficiency. Casella’s most recent financial results also appear to support the board’s assertions that its strategy is yielding improvements.”With respect to JCP’s proposed board candidates, ISS noted its concern that the JCP nominees may not bring to the Casella Board any perspectives not already present among the current members of the Casella Board and the risk that JCP’s proposed board candidates could have an adverse effect on the progress and momentum that Casella has achieved in executing on its strategy. As ISS recognized:“the risk of derailing the recent improvements overseen by the current board appears to outweigh the potential benefits of injecting additional, but potentially duplicative new perspective to the board.”Egan-Jones, one of the leading U.S. proxy advisory firms, has published a report recommending that Casella stockholders vote the WHITE proxy card FOR ALL three of Casella’s director-nominees – John W. Casella, William P. Hulligan and James E. O’Connor – standing for election at the 2015 Annual Meeting of Stockholders to be held on November 6, 2015. The Egan-Jones recommendation follows the recent recommendation of Institutional Shareholder Services Inc. (ISS), which also recommended that Casella stockholders vote the WHITE proxy card FOR ALL three of Casella’s director nominees.Another proxy advisor has offered the same advice. Proxy Mosaic, one of the leading US proxy research and corporate governance firms, has published a report recommending that Casella stockholders vote the WHITE proxy card FOR ALL three of Casella’s director-nominees.In its recommendation, Egan-Jones highlighted the following:Voting FOR management’s nominees and voting FOR management’s proposals on the WHITE proxy card is in the best interest of Casella and its stockholders;JCP has made an insufficient case to warrant the election of its nominees to Casella’s Board of Directors;Casella has continued to execute well against its key strategies and is driving improved financial performance; andCasella’s Board is composed of nine highly-qualified and experienced directors, seven of whom are independent, and boasts a broad and diverse set of skills and experiences in the areas of solid waste collection, recycling, disposal services, operations, accounting, finance, mergers and acquisitions, capital markets, capital allocation, capital structure, risk management, and strategic planning.Q3 2015 Financial ReportCasella reported its third quarter results for the period ended September 30, 2015 on October 23. Revenues and earnings were up and ahead of Wall Street analysts’ forecasts. Shares on October 28 were $6.14 and were trading at the high end of its 52-week range ($3.41 – $6.75).Highlights for the Three and Nine Months Ended September 30, 2015:Revenues were $146.2 million for the third quarter, up $4.3 million, or 3.0%, from the same period in 2014. Revenues year-to-date were $406.5 million, up $14.1 million, or 3.6%, from the same period in 2014.Adjusted EBITDA* was $33.1 million for the third quarter, up $2.4 million, or 7.8%, from the same period in 2014. Adjusted EBITDA year-to-date was $78.3 million, up $5.9 million, or 8.1%, from the same period in 2014.Operating income for the third quarter was $12.7 million, up $2.1 million, or 19.5%, from the same period in 2014. Operating income year-to-date was $27.2 million, up $20.7 million, or 319.5%, from the same period in 2014.Free Cash Flow* for the third quarter was $0.8 million, up $7.0 million from the same period in 2014. Free Cash Flow year-to-date was $11.6 million, up $19.8 million from the same period in 2014.Overall solid waste pricing for the third quarter was up 2.9%, mainly driven by strong residential and commercial collection pricing up 5.2%.“During our third quarter, we continued to execute well against our key strategies of increasing landfill returns, improving collection route profitability, creating incremental value through resource solutions, reducing financial and operational risks, and improving our balance sheet,” said John W. Casella, Chairman and CEO of Casella Waste Systems. “I am pleased with the third quarter results and our continued improvement across our key operating and financial metrics.”“As a result, we continued to expand Adjusted EBITDA margins, up roughly 100 bps year-over-year, and we used positive free cash flow generated on a year-to-date basis to repay debt during the quarter,” Casella said. “We repurchased and permanently retired $9.7 million of our 7.75% Senior Subordinated Notes due 2019 during the quarter, demonstrating our commitment to reduce leverage and accelerate free cash flow generation by retiring our highest cost debt. With our continued cash flow growth and debt repayment during the third quarter, we reduced our consolidated leverage ratio as defined by our ABL Revolver to 4.98x as of September 30, 2015, down from 5.43x on March 31, 2015.” “From an operating standpoint, our solid waste pricing programs continued to gain traction in the quarter with overall solid waste pricing up 2.9%, driven by strong residential and commercial pricing up 5.2% and higher pricing in the disposal line-of-business, with our average landfill price per ton up 3.3%,” Casella said. “These strong pricing gains were complemented by further improvements in our operating efficiency programs with our fleet and routing programs driving lower costs.”“We continued to have success implementing the Sustainability/Recycling Adjustment (“SRA”) fee to offset lower recycling commodity prices and driving higher returns in the recycling line-of-business,” Casella said. “Through the third quarter we have rolled out the SRA fee to over 80% of our target collection customers.”Casella’s Board of Directors has issued a letter to its stockholders and a retort to JCP.The letter, which includes a WHITE proxy card, outlines the significant and decisive actions that Casella’s Board and management have taken to enhance Casella’s long-term prospects and best position Casella to create value for its stockholders, and recommends that stockholders vote on the WHITE proxy card FOR the election of all three of Casella’s highly qualified and very experienced nominees, John W Casella, William P Hulligan and James E O’Connor. Casella urges stockholders to promptly vote the WHITE proxy card via Internet, telephone or mail by following the instructions provided. The Board also urges stockholders to discard any gold proxy card or voting instruction form they may receive from the JCP Group.As previously disclosed, JCP Investment Management, LLC (James C Pappas majority owner) and the other participants in its solicitation (the “JCP Group”) have indicated that they intend to conduct a proxy contest and seek the election at the 2015 Annual Meeting of director candidates in opposition to “the highly qualified and very experienced nominees unanimously recommended by the Casella Board.”JCP, in its statement, blistered the existing Board and management by saying, in part, “In our view, Casella is deeply undervalued as a result of poor investment and operational decisions and a dual capital structure that has eroded shareholder rights and value.” It is putting up three candidates, as is Casella.In order for stockholders to have access to all relevant information concerning the 2015 Annual Meeting that Casella has made available, the company has developed a website focused on the 2015 Annual Meeting, which is accessible at www.casellashareholders.com(link is external)(link is external).
A two property Class A retail portfolio in Scottsdale, which includes Scottsdale Seville and La Mirada Shopping Center, sold for $72,500,000 million, according to Lee & Associates.The Fincham Dempsey Team at Lee & Associates, led by principals Jan Fincham and Pat Dempsey, facilitated the transaction along with Lee principals Craig Coppola and Andrew Cheney and Associate, Gregg Kafka, who assisted with the sale. The seller was a partnership of several San Francisco Bay area investors. The buyer was Houston-based Houston-based Whitestone REIT.The Scottsdale Seville Shopping Center sold for $34,000,000 and is a Class A boutique Lifestyle center built in 1990. It is located at the NEC of Scottsdale and Indian Bend roads. The property consists of 90,042 square feet and includes national and regional tenants such as Ruth’s Chris Steak House, Starbucks, Wildﬂ ower Bread Company, Jamba Juice, Orange Theory Fitness and Azadi Fine Rugs. The center is located across the street from the upcoming $2 Billion Ritz-Carlton Resort.The La Mirada Shopping Center, sold for $38,500,000, was built in 1996 and consists of 147,209 SF. It is located at the NEC of Pima and Pinnacle Peak roads in the heart of the aﬄ uent demographic of North Scottsdale and attracts shoppers from many master-planned communities such as Silverleaf, DC Ranch, McDowell Mountain Ranch, Troon, Troon North, Legend Trails and Greyhawk. Tenants at La Mirada include the renowned Maestro’s Steak House, Walgreens, Starbucks, Jade Palace, Russ Lyon, Sotheby’s, and Pima Animal Hospital.
The Jamaica Scorpions Franchise will have a totally local composition after the 2020 Cricket West Indies (CWI) Professional Player Draft for the Colonial Medical Insurance Super50 Cup and the Professional Cricket League Regional Four-Day Championship.With 13 local players already pre-selected and protected, the Scorpions will only need to select two players from the online draft, which will be held via Zoom today. The Gleaner has learnt that the franchise is planning to add an all-rounder and a fast bowler to complete the minimum 15 contracted players.With that, Guyanese batsman Assad Fudadin, who played four games for Jamaica last season in the Four-Day Championship, has been cut, as well as Grenadian wicketkeeper Denis Smith, who played six games during his debut season for the Scorpions.Fudadin scored just 83 runs in eight innings this season at an average of 10.37 while Smith, who fared better with 227 runs in 11 innings, had 17 dismissals behind the stumps after taking over from Aldane Thomas.In the 2018-2019 season, the Scorpions had Fudadin and Barbadian all-rounder Kenroy Williams as their two overseas picks.This year, CWI’s board has decided that the requirement to contract at least two players from outside of the franchise territory will not be mandatory.With the advent of COVID-19 and the negative impact it has had on the sporting landscape, in particular cricket, globally and regionally, all contracts will be awarded for only a six-month term at a 50 per cent reduced value.After the latest developments, Scorpions chief selector Junior Bennett, who will make the two picks with head coach Andre Coley today, says the move by the board to go with only local players was a unanimous and obvious one.“With the cut in fees, looking at someone with a ‘C’ contract now to come and live in a different country earning, let’s say $60,000 per month, you can’t pay rent and find transportation out of that, and so that doesn’t make sense to have an overseas player right now,” Bennett said.Eighteen Jamaicans have been listed in the player pool, which has 109 players. Several Jamaicans who represented other franchises last season are now available to be selected. They are Odean Smith, who played for the Trinidad and Tobago Red Force; Ramaal Lewis, who played for the Guyana Jaguars; and leg spinner Damion Jacobs, who played three matches for the Leeward Islands Hurricanes. Windies Under-19 batsman Kirk McKenzie is also listed in the draft pool. The Scorpions will have the third picks in both rounds.John Campbell (captain)Jermaine BlackwoodNkrumah BonnerPaul Palmer JrDerval GreenMarquino MindleyAkim FraserDennis BulliAndre McCarthyNicholson GordonPatrick Harty JrAldane ThomasJeavor Royal