Jeremy L. Dillon
RW Monitor
5/16/2014
Valhi, Inc., the parent company of Waste Control Specialists, reported this week that its waste management segment suffered an operating loss of $8.5 million in the first quarter of 2014, a larger loss compared to the operating loss of $1.6 million in the same period of 2013. In its quarterly filing to the Securities and Exchange Commission, Valhi blamed the results on the shipping cask shortage affecting the movement of waste. “The Waste Management Segment’s sales declined in the first quarter of 2014 compared to the same period in 2013 due to lower volumes of shipments received for disposal in the Compact LLRW disposal facility, primarily because there has been an industry wide temporary shortage of shipping containers needed to transport LLRW,” the filing said. “We currently expect this issue to be resolved in mid-2014.” WCS has already received the first of three Type-B shipping casks, and it expects the other two in the coming months. WCS did not return calls for comment this week.
Valhi’s filing also said that if cash flow does not begin to improve, it could, as it has done in the past, choose to seek “strategic alternatives” for WCS. “We believe WCS can become a viable, profitable operation; however, we do not know if we will be successful in improving WCS’ cash flows,” the filing said. “We have in the past, and we may in the future, consider strategic alternatives with respect to WCS. We could report a loss in any such strategic transaction.” Valhi also said that “it may be difficult for us to generate positive operating results until we begin routinely receiving large Federal LLRW streams for disposal.” WCS currently has a contract for a period of five years and up to $300 million with the Department of Energy to dispose of low-level radioactive waste in its federal disposal facility, but the tasks awarded under the contract to date have been for smaller volume waste streams, Valhi said.
