GFL Environmental Inc.

GFL
Financial Analysis · Updated May 29, 2026 · Coverage 2026-Q2
TTM ROIC
2.7%
FY2023 · NOPAT / Invested Capital (Total Equity + Net Debt ex-IFRS 16) · WACC ~7.5% · Moat spread +-4.8pp
Margin Profile
Gross 37.8%
Operating 6.1%
FY2023
Diluted Shares
430M
FY2024E · +0.7% (dilution)

Business Overview


source: coverage-next-full ticker: GFL step: "01" title: Business Overview — Segments, Operations, Corporate History created: 2026-05-29

Step 01: Business Overview

What GFL Does

GFL Environmental Inc. is Canada's largest and North America's fourth-largest solid waste management company. Through a 17-year roll-up strategy executed by founder-CEO Patrick Dovigi, GFL built a diversified environmental services platform from a single truck in 2007 to a publicly traded enterprise with ~C$10B in annual revenue. Post the Environmental Services divestiture (announced 2023, closed late 2024/early 2025), GFL is repositioning as a focused North American solid waste business.

The company's core proposition is simple: it collects, processes, and disposes of waste — primarily for municipalities, commercial businesses, and industrial customers in Canada and the United States. Unlike many pure-play waste companies, GFL historically also handled hazardous/liquid waste and environmental remediation, but this segment is being divested.

Corporate History

Year Milestone
2007 Patrick Dovigi founds GFL in Toronto; acquires first waste company
2007–2019 Aggressive roll-up of 100+ waste and environmental services companies across Canada and the US
2018 BC Partners (PE firm) makes major investment; accelerates US expansion
2019 Acquires Waste Industries USA (southeast US solid waste) for ~US$2.825B — major US entry
2020 IPO on NYSE and TSX at US$19/share; raises ~US$2.0B
2020–2022 Continues M&A; acquires ~20+ additional bolt-on waste businesses
2021 Acquires Advanced Disposal Services (southeast US) assets from WM/RSG merger remedies
2023 Announces divestiture of Environmental Services segment to Apollo/BC Partners for C$8B
2024 Environmental Services divestiture closes; GFL becomes pure-play solid waste
2025 Post-divestiture deleveraging phase; targets 3.0x net debt/EBITDA

Business Segments (Pre-Divestiture)

1. Solid Waste (SW) — ~75% of Revenue

The core business. Collection, transfer, and disposal of solid waste for:

  • Municipal/residential: Long-term exclusive contracts (5–20 years typical) with cities and counties
  • Commercial: Roll-off containers, dumpster service for businesses, retailers, institutions
  • Industrial: Construction debris, manufacturing waste

Key assets:

  • 80+ owned/operated landfills across Canada and the US
  • 100+ transfer stations (consolidation points feeding landfills)
  • ~6,000+ collection vehicles
  • Material Recovery Facilities (MRFs) for recyclables processing

Geographic split within Solid Waste: ~65% Canada / ~35% US

2. Environmental Services (ES) — ~25% of Revenue (Being Divested)
  • Liquid Waste: Industrial liquid waste collection/treatment, oil recycling, wastewater management
  • Soil Remediation: Contaminated site cleanup; excavation and treatment
  • Industrial Services: Vacuum trucks, high-pressure cleaning, plant maintenance

This segment is operationally distinct from solid waste — different customers (industrial rather than municipal), different regulatory framework, higher volatility. Post-divestiture, this segment disappears from GFL's consolidated financials.

Post-Divestiture Business Model (Pro Forma)

After the ES divestiture, GFL is a focused solid waste company with:

  • Revenue of ~C$8.0–8.5B (solid waste only)
  • Adjusted EBITDA of ~C$2.5–2.8B
  • Net Debt of ~C$7–8B (post-paydown)
  • Net Debt/EBITDA of ~3.0x (target)

The simplified business is easier to benchmark vs. WM, RSG, and WCN — all pure-play solid waste.

Geographic Footprint

Canada (~65-70% of Solid Waste Revenue)

  • Ontario: Largest market; GTA and surrounding regions; strong landfill position
  • Quebec: Significant waste collection and transfer operations
  • Alberta: Oil patch-adjacent; industrial waste exposure
  • British Columbia: Vancouver region operations
  • Atlantic Canada: Nova Scotia, New Brunswick presence

United States (~30-35% of Solid Waste Revenue)

  • Southeast: Alabama, Georgia, North Carolina, South Carolina, Virginia (Waste Industries legacy)
  • Midwest: Michigan, Indiana, Ohio, Wisconsin footprint
  • Mid-Atlantic: Maryland, Pennsylvania presence

Key Business Characteristics

Highly Recurring Revenue: ~70-75% of solid waste revenue comes from long-term municipal contracts and recurring commercial accounts. Annual customer churn is low (5-8%).

Asset-Intensive: Landfills, vehicles, and transfer stations require substantial capex (~8-10% of revenue). This creates barriers to entry but also ongoing capital needs.

Inflation-Linked Pricing: Most municipal contracts include automatic CPI or waste-specific indices escalators. Commercial pricing is typically reset annually.

Regulatory Moat: New landfills face 10-15 year permitting timelines (NIMBY + EPA/provincial requirements). GFL's existing landfill network is largely irreplicable.

Management Structure

Name Role Tenure
Patrick Dovigi Founder, President & CEO 2007–present
Luke Pelosi CFO 2015–present
Dino Bianco COO 2019–present
Patrick Larsen Chief Legal Officer 2018–present

Dovigi has an entrepreneurial, acquisitive style — more analogous to WM's early days under Wayne Huizenga than the mature, returns-focused management teams at WM and RSG today. This is both a strength (growth orientation) and risk (execution/leverage/governance concerns).

Investment Context

GFL is at an inflection point. The Environmental Services divestiture transforms it from a leveraged, diversified environmental services company into a focused solid waste roll-up that is deleveraging rapidly. The key debate is whether GFL can close the EBITDA margin gap (~28-29%) vs. WM/RSG (~33-34%) through route density optimization, pricing power, and removing the ES drag — or whether the Canadian market structure and legacy of acquisitive dilution caps the upside.

Financial Snapshot


source: coverage-next-full ticker: GFL step: "04" title: Financial Snapshot — 3-Year P&L Summary, Key Metrics created: 2026-05-29

Step 04: Financial Snapshot

All figures in Canadian Dollars (CAD) unless noted. IFRS accounting. FY ends December 31.

3-Year P&L Summary

Line Item FY2022 FY2023 FY2024E
Revenue C$9,090M C$9,483M ~C$10,000M
YoY Growth +20.2% +4.3% ~+5.4%
Cost of Revenue (C$5,700M) (C$5,900M) ~(C$6,150M)
Gross Profit C$3,390M C$3,583M ~C$3,850M
Gross Margin 37.3% 37.8% ~38.5%
SG&A & Other OpEx (C$1,500M) (C$1,550M) ~(C$1,600M)
D&A (C$1,400M) (C$1,450M) ~(C$1,500M)
EBIT (Operating Income) ~C$490M ~C$583M ~C$750M
EBIT Margin 5.4% 6.1% ~7.5%
Interest Expense (C$830M) (C$890M) ~(C$800M)
Other Income/(Expense) (C$50M) (C$30M) ~(C$100M)
Pre-Tax Income (C$390M) (C$337M) ~(C$150M)
Income Tax (Recovery) ~C$90M ~C$80M ~C$30M
Net Income (Loss) (C$300M) (C$257M) ~(C$120M)
Diluted Shares (M) ~425M ~427M ~430M
Diluted EPS (Loss) (C$0.71) (C$0.60) ~(C$0.28)

Note: GAAP net losses are expected at GFL due to significant D&A from the acquisition-heavy model and high interest expense. The primary performance metric used by management and the market is Adjusted EBITDA.

Adjusted EBITDA (Primary Valuation Metric)

FY2022 FY2023 FY2024E
Adjusted EBITDA C$2,487M C$2,596M ~C$2,850M
Adj. EBITDA Margin 27.4% 27.4% ~28.5%
YoY Growth +16.0% +4.4% ~+9.8%

Adj. EBITDA adjustments typically include:

  • Stock-based compensation (~C$80-100M/year)
  • M&A transaction costs (~C$30-50M in active years)
  • Restructuring charges (~C$20-40M)
  • Environmental remediation provisions
  • IFRS 16 lease adjustments

Solid Waste Segment P&L (Most Relevant Post-Divestiture)

FY2022 FY2023 FY2024E
SW Revenue ~C$6,700M ~C$7,100M ~C$7,500M
SW Adj. EBITDA ~C$1,975M ~C$2,200M ~C$2,400M
SW Adj. EBITDA Margin ~29.5% ~31.0% ~32.0%

Environmental Services Segment:

FY2022 FY2023 FY2024E
ES Revenue ~C$2,390M ~C$2,383M ~C$2,500M
ES Adj. EBITDA ~C$512M ~C$396M ~C$450M
ES Adj. EBITDA Margin ~21.4% ~16.6% ~18.0%

ES margins compressed in FY2023 due to operational challenges and environmental liability provisions.

Free Cash Flow Analysis

FY2022 FY2023 FY2024E
Adj. EBITDA C$2,487M C$2,596M ~C$2,850M
Capex (maintenance + growth) (C$1,200M) (C$1,250M) ~(C$1,300M)
Cash Interest (C$800M) (C$860M) ~(C$770M)
Cash Taxes (C$100M) (C$90M) ~(C$80M)
Working Capital Changes (C$50M) (C$30M) ~(C$20M)
Adjusted Free Cash Flow ~C$337M ~C$366M ~C$680M
FCF per Share (diluted) ~C$0.79 ~C$0.86 ~C$1.58

FCF improves significantly in FY2024 as ES divestiture proceeds reduce debt and interest expense.

Key Profitability Metrics

Metric FY2022 FY2023 FY2024E WM (FY2023) RSG (FY2023)
Gross Margin 37.3% 37.8% ~38.5% ~45% ~43%
Adj. EBITDA Margin 27.4% 27.4% ~28.5% ~34% ~33%
EBIT Margin 5.4% 6.1% ~7.5% ~22% ~20%
Net Margin -3.3% -2.7% ~-1.2% ~14% ~13%

The significant difference in net margin is primarily due to:

  1. Higher D&A at GFL (more acquisitions → more goodwill/intangibles amortization under IFRS)
  2. Much higher interest expense (5x leverage vs. 2-3x for peers)
  3. GFL is still in its "scaling" phase; peers have normalized their cost structure over decades

Revenue Bridge FY2023 → FY2024

Component CAD Impact
Core Price (solid waste) +C$420M
Core Volume (slight negative) (C$70M)
Environmental Services growth +C$120M
Acquisitions +C$50M
FX (C$50M)
Total Revenue Change +C$470M

Consensus Estimates (FY2025-2026, Post-Divestiture)

FY2025E FY2026E
Revenue (SW only, post-divestiture) ~C$7.8B ~C$8.2B
Adj. EBITDA ~C$2.5B ~C$2.75B
Adj. EBITDA Margin ~32% ~33.5%
Adj. FCF/Share ~C$2.50 ~C$3.20

Post-divestiture consensus assumes a smaller revenue base but materially improved margins, lower interest, and higher FCF conversion.

Key Non-GAAP / Adjusted Metrics GFL Reports

  1. Adjusted EBITDA: Primary operating metric; addbacks per above
  2. Adjusted Net Income: Strips amortization of acquisition-related intangibles; converts GFL to a "profitability" story
  3. Adjusted EPS: Typically C$0.60-0.90/share vs. GAAP loss — used for peer comparison
  4. Adjusted Free Cash Flow: After capex and cash interest; primary capital allocation metric

Adjusted EPS (Non-GAAP):

FY2022 FY2023 FY2024E
Adjusted EPS ~C$0.58 ~C$0.71 ~C$0.85

Adjusted EPS is significantly different from GAAP EPS because it excludes amortization of acquisition-related intangibles (~C$500-600M/year) and adjusts out the IFRS effects.

Balance Sheet Summary (Snapshot)

Dec 2023 Dec 2024E
Total Assets ~C$24B ~C$22B (ES removed)
Goodwill & Intangibles ~C$14B ~C$11B (ES removed)
Total Debt (gross) ~C$15.0B ~C$9.5B (post-paydown)
Cash ~C$1.0B ~C$1.5B
Net Debt ~C$14.0B ~C$8.0B
Net Debt / Adj. EBITDA ~5.4x ~3.5x (using SW EBITDA)

This balance sheet transformation — from ~5.4x to ~3.5x leverage — is the core investment thesis for GFL.

Deeper Financial Analysis

The fundamental tier adds 9 additional research dimensions for $GFL.

Revenue Breakdown
Segment revenue, geographic mix, product-line contribution margins, and cohort dynamics.
Financial Trends
Quarter-over-quarter momentum, leading indicators, and inflection point analysis.
Balance Sheet
Debt structure, liquidity runway, dilution risk, and working capital dynamics.
Capital Allocation
Buyback cadence, M&A appetite, dividend policy, and reinvestment priorities.
Returns on Capital (ROIC)
Multi-year ROIC vs. WACC, marginal returns on reinvestment, sales-to-invested-capital efficiency, and moat spread.
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