Good morning, my name is Rochelle and I will be your conference operator today. At this time I would like to welcome everyone to the Waste Management Second Quarter 2013 Earnings Release Conference Call. (Operator Instructions). After the speakers’ remarks there will be a question-and-answer session. (Operator Instructions). I would now like to turn the call over to Ed Egl, Director of Investor Relations. Thank you. Mr. Egl, you may begin your conference.

Thank you, Rochelle. Good morning, everyone, and thank you for joining us for our second quarter 2013 earnings conference call. With me this morning are David Steiner, President and Chief Executive Officer; Jim Fish, Executive Vice President and Chief Financial Officer; and Jim Trevathan, Executive Vice President and Chief Operating Officer. David will start things off with a summary of the financial results for the quarter, including internal revenue growth from yield and volume. Jim will cover our revenue growth, price and volume trends, operating costs and the financial statements. We will conclude with questions and answers. During our statements, any comparisons, unless otherwise stated will be with the second quarter of 2012. Before we get started let me remind you that in addition to our earnings press release that was issued this morning we have filed a Form 8-K, that includes the earnings press release as Exhibit 99.1, and is available on our website at www.wm.com. The Form 8-K, the press release and the schedules to the press release include important information that you should refer to. During the call you will hear certain forward-looking statements which are based on current expectations, projections, estimates, opinions or beliefs about future periods. Such statements are subject to risks and uncertainties that could cause actual results to differ materially. Some of those risks and uncertainties are detailed in today’s press release and our filings with the Securities and Exchange Commission, including our most recent Form 10-K. Additionally, during the call David and Jim will discuss our earnings per diluted share, which they may refer to as EPS or earnings per share on an as-adjusted basis. David will also discuss operating EBITDA as defined in our Form 8-K filed today. Our EPS and operating EBITDA have been adjusted to exclude items disclosed in…

Thanks, Ed and good morning from Houston. During the second quarter, our earnings per share grew to $0.54, overcoming $0.03 of unexpected headwind. We had a negative $0.02 additional headwind from our recycling operations and a negative $0.01 from litigation settlements. Without these headwinds we would have earned $0.57 per share close to 10% earnings growth. Our disciplined approach to improving price, reducing cost and managing capital expenditures is reflected in this earnings growth and in our free cash flow. So we are pleased with our results of the second quarter and year-to-date which are right on plan despite the negative impact from our recycling business. The story of our quarter is that we had very strong results in our traditional solid waste operations but overall results were muted by unexpected headwinds in our recycling business. Even with these headwinds our operating EBITDA margins grew by 20 basis points. In our traditional solid waste business we grew income from operations margins by 80 basis points driven by our yield and cost program. We expect this margin expansion to continue throughout 2013 and to accelerate into 2014. Volumes improved sequentially in all of our collection lines of business, except recycling and roll-off. We offset roll-off volumes losses with very strong yield which drove 90 basis points of margin expansion in our roll-off business. In our recycling business we expected the second quarter impact to be a negative $0.03 to earnings per share. The actual result was a negative $0.05. Looking out to the third and fourth quarters we originally expected a positive $0.04 impact on earnings per share when compared to 2012 from our recycling operations. We now think that the impact from our recycling operations will be flat year-over-year in the second half of 2013. Thus, we now expect the…

Thank you, David. I will start by discussing our strong SG&A and cash flow performance then I will expand on David’s comments about results of operations from our traditional solid waste business and yield and volume in our various lines of business. I will conclude with a discussion of our financial metrics. In our SG&A cost category we continue to see results of our restructuring and focus on controlling cost. SG&A cost were $353 million in the second quarter and 10% of revenue, an improvement of $21 million and an 80 basis point improvement compared to the second quarter 2012 as a percent of revenue. The two biggest areas of savings came from labor due to our restructuring last year and our focus on lower controllable cost. These savings were partially muted by $30 million incremental compensation plan accrual that did not occur in 2012. Bad debt expense improved SG&A cost by $8 million due to the partial collection of a receivable at our Puerto Rico operation. Additionally, DSO improved sequentially. In fact we improved DSO sequentially for three consecutive quarters. We are pleased with the second quarter SG&A results but we still have a lot of work in front of us to achieve our full year goals. In the third quarter we expect approximately $45 million of headwind in SG&A from incentive compensation accruals. We only have $30 million in the second quarter of 2013. However for the full year we still anticipate achieving our goal of flat SG&A costs when compared to full year of 2012. Turning to cash flow, second quarter 2013 net cash provided by operating activities was $545 million. This is a decrease of $124 million compared to the second quarter of 2012. In 2013 we had $117 million increase in taxes paid based on…

(Operator Instructions). Your first line comes from the line of Hamzah Mazari with Credit Suisse. Hamzah Mazari – Credit Suisse: Good morning. Thank you.

Good morning Hamzah. And happy birthday by the way. Hamzah Mazari – Credit Suisse: Hey, thanks a lot. Appreciate it. The first question David is just on volume. It seems like the recycling business is 12% of revenue. It’s not that big. You guys said that it’s 1% down on volume. Is all of the volume loss or below volume relative to expectations, given what you’re seeing with the rest of the sector. Is that all you guys just walking away from lower margin roll-off business or is there something else in that as well.

Yeah, I think that’s basically – Hamzah I mean as we mentioned we got the highest new business pricing that we’ve ever seen in the roll-off line of business. When you think about it, if you look at the roll-off line of business, as a 20% call or 20% margin business every time you get a new can, 20% of it drops to the bottom line, every time you get 1% price, a 100% drops to the bottom line. So you have to get 5% volume in order to make up for 1% price. What we saw in this quarter was basically you saw the quarter-to-quarter change in yield was 1.3%. In order for that to equate to a fair trade-off we have to get 7% volume. You can’t do that in this business. And so we went around and talked to our folks out in the field and they said look we can go get roll-off volume if you want us to. But what we’re going to do is we’re going to mess up the market at a lower price and we’re going to get low margins on it. We would much rather go out at higher price, offer good quality for what we’re doing. And get that higher price roll-up volume, and as you can see that trade-off worked very well with 100 basis points of margin expansion. Hamzah Mazari – Credit Suisse: Okay. And maybe if you could give us a sense of the lag that it may take the field organization in making the adjustments on the recycling business to get the surcharges and fees, how much of a lag do you think it’s going to take the field to get rid – the recycling from sort of not being a margin headwind. Is this more of a two quarter lag or any sense of expectation there?

Yeah, I mean there are two sort of two pieces to the recycling business. There is the commercial recycling that as this closes we can get sort of the spot recycling if you will. And on those types of transactions we can change the price today and we got folks and teams out in the field just doing that. In other cases we have long term contracts with municipalities and other folks and we need to get through those contracts we need to understand what our rights under those contracts and We need to go and talk the customers. So it’s there are pieces of it that we can do quickly, there are pieces of it that take time. I would say frankly Hamzah overall it’s going to take little bit of time. But what we’ve told our field operations is we don’t have luxury of time right now. I mean we are losing money in our recycling operations, in most of our recycling operations we’ve got to turn that around. We’ve got to turn around now. Hamzah Mazari – Credit Suisse: And just last question from me. I’ll turn it over. The land fill pricing it seems like that decelerated at 1.8% relative to sort of the mid 2% it was running. Could you maybe comment on that? Thank you.

Actually it was up in the quarter from prior quarters. Last time we saw yield that high was Q1 of ‘12 on the MSW line. But look, we talked about it very vocally that we need to get that sort of 5% to 7% increase of the land fill. That is like the recycling business in that you got lot of long term contracts. You have to work through those issues. And we’re absolutely working through those issues. We will not back down on our 5% to 7% price increase. Hamzah Mazari – Credit Suisse: Thanks a lot.

Sure.

Your next question from the line of Bill Fisher with Raymond James. William Fisher – Raymond James: Good morning.

Good morning, Bill. William Fisher – Raymond James: Hey, first of, Jim, you mentioned I think, I just want to make sure I had the numbers right of operating cost increase like 30 million of it was Wheelabrator maintenance and recycling, is that roughly right?

About 35 million was a combination of the one-time Wheelabrator advance maintenance events and recycle. William Fisher – Raymond James: So the rest of it you did a math roughly was the cost was only up 1% or so you had good cost control on the rest of it.

Yeah, you know, one thing, Bill that we have talked a bit about in previous quarters was maintenance cost. Actually in our traditional on our core business, maintenance costs have improved by 11 basis points, so while it’s not where we want to be, we are starting to move in the right direction. William Fisher – Raymond James: Okay, great, then quickly on the acquisitions and divestitures did you – I thought I saw in that Quebec papers, did you guys were able to close that RCI transaction?

Are you able to read the Quebec papers? William Fisher – Raymond James: Yeah, I had to translate it but that’s what it looked like.

Yes, we did, we closed it early July. William Fisher – Raymond James: Okay, and any rough hand on what the annualized revenues on that would be?

Yeah, the annualized revenue is roughly a 170 million. William Fisher – Raymond James: Okay.

Bill, when we had actually intended to close that, we had an agreement to close that for quite a while. When we gave our full year guidance we actually expected to close that at the beginning of the year, not in the middle of the year. So it is baked into our guidance but it will be a great acquisition for us. Lucien Remillard built a spectacular business up there and we are looking forward to leveraging the great company that he built. William Fisher – Raymond James: Okay, you have some decent overlap on the hauling side too, or do you not have that?

Well, you know frankly this is sort of a minnow swallowing the whale, we have a fairly small presence from a collection point of view in the Montreal market area. RCI had a much bigger presence. So we are going to keep the RCI brand in Montreal. William Fisher – Raymond James: Okay, great thank you.

And your next question from the line of Corey Greendale with First Analysis. Corey Greendale – First Analysis: Hi, good morning.

Good morning. Corey Greendale – First Analysis: First question I want to ask about the price, so given that it is moving in the right direction would you say that you have most of the pricing actions kind of fully baked in Q2 so we should expect a similar level price in Q3 or would there still be some acceleration as you keep implementing that stuff.

Yeah, you know, the regulatory cost recovery fee we did not, we did not get a full quarter benefit out of it in this quarter because we implemented it sort of in mid quarter. But we will also have you know, some head wins coming in the back half of the year from CPI, from the reset contracts in Florida. All in all I will call it sort of a wash. We said in the beginning of the year that we would be at sort of 1 to 1.5 % yield for the first half of the year we were at 1.7%. I now expect that for the full year we would probably be at that 1.5% to 2 % type of range. You know, there are a couple of factors that come into the second half of the year that lead me to not try to say we are going to see dramatic acceleration but I can promise you from a total dollars to the bottom line we haven’t taken our foot off the pedal. Corey Greendale – First Analysis: In the sense how much of that 2% yield from the regulatory recovery would be?

Just about $8 million in a quarter. Corey Greendale – First Analysis: Right. And you talked about the non-compliance in some cases with the fees and surcharges, can you put some kind of parameters on that, like how much of an – what percentage the customer base is compliant with that and what kind of opportunities to get to get closer to 100% compliance?

Yeah, I mean look the opportunity is tremendous, when I talked about it especially at 20 to 30% price decrease when you waive fees and surcharges. On a commercial line of business we are about 85% compliant, on the roll off line of business we are only about 55%, because basically what you have got, the roll off line of business, you know, it is a little bit baffling to me in the low margin line of business you see folks out there waiving fees and surcharges on the roll off line of business. So it is very competitive in the roll off line of business our compliance is about it, 55%, so you know just take 20% to 30% price roll back and add it back into that and you can see the dramatic effect that has on earnings. Corey Greendale – First Analysis: On that front as you trying to see new entrants into that business or is it primarily the entrenched players that you are seeing being more aggressing and wait and see.

Well, you know, I think it is, I think that one is sort of across the board, I think there is obviously a lot of competition in the roll off line, it’s very low barrier to entry. But I would say that it is sort of across the board. Generally what you have seen is that the smaller players sometimes don’t even have the fees and surcharges, the larger players generally are the ones that will roll it back. Corey Greendale – First Analysis: Okay, and then just a quick housekeeping one for Jim? Jim, what would you suggest the tax rate for the back half of the year?

We obviously we are going to approach the statutory rate of 35% and I will stick to that. Corey Greendale – First Analysis: Okay, great. Thank you.

Your next question comes from the line of Alex Ovshey with Goldman Sachs. Usha Gunthapally – Goldman Sachs: Good morning. This is actually Usha Gunthapally on behalf of Alex Ovshey. How are you?

Good morning, doing well. Usha Gunthapally – Goldman Sachs: Great. Just on the CapEx expectation for full year 2013 the run rate so far seems to be below your initial guidance. How do you think about a lower bound?

Well I would say that we are still on track to hit our guidance of 1.3 to 1.4. Typically we see an acceleration of capital spending in the second half of the year. So it may look like if you straight line it you are going to get 1.3 to 1.4 range. We will more than likely see an acceleration in the second half as we always do and end up right within the range. Usha Gunthapally – Goldman Sachs: Got it, and one more. So on roll back in second quarter they were lower by 45% year-on-year without increasing the churn rate. Does this imply improved pricing discipline in the industry generally?

No, I don’t think there is any doubt. You know I mean look, we can’t particularly speak for the industry. We can only speak for what we do and I can promise you that there is absolutely no doubt there has been increased discipline with our folks as far as rolling back prices and look it’s a tribute to our sales folks and to our training folks who you know this doesn’t happen just by putting an edict out that we are not going to rollback prices. There is lot of training that goes into it, lot of preparation goes into, there is lot of work by our customer service reps that go into it and they have done a phenomenal job turning it frankly that fast. Usha Gunthapally – Goldman Sachs: Got it, and any expectation for second half on roll-off fees?

Yeah, generally roll-off or rollbacks? Usha Gunthapally – Goldman Sachs: Rollback. Sorry.

Yeah, generally rollbacks do pick up a little bit in the back half of the year but we are doing a nice job of holding the line and I wouldn’t expect to see it materially change. It could pick up a little bit but I wouldn’t expect to see it materially change. Usha Gunthapally – Goldman Sachs: Got it, thank you.

Thank you.

And your next question comes from the line of Joe Box with KeyBanc Capital. Joe Box – KeyBanc Capital Markets: Really nice job on the SG&A front. I understand you guys reiterated your flat year-over-year guidance and I guess that makes sense with comps getting tougher in 3Q and accruals sequentially ramping. I am just curious if you maybe give us a little more color on how much flexibility you have toward that flat guidance? You know is that a stretch or are you thinking you could actually put up better SG&A margin given improvement you have seen so far?

You know Joe I would say it’s not a huge stretch but it’s also I don’t think we have a whole lot of room there either. I think we are probably pretty comfortable with flat year-over-year which is saying something considering you know the comp headwinds that we have faced. So I think we are probably on track to hit the flat guidance with 2012 that we have given. Joe Box – KeyBanc Capital Markets: Okay and switching gear to the recycling side. I am sure we could probably back into the so I just want to check. Can you just flush out with the swing in recycling volumes ended up contributing to the 60 basis points of volume degradation that you had?

Yeah we will run that calculation for you and check it and get the number to you. Joe Box – KeyBanc Capital Markets: Okay, yeah that will be helpful. And then…

But frankly speaking I don’t know how to do that complicated math. Joe Box – KeyBanc Capital Markets: Was there any difference then between your internal marks, what you saw from the volume basis there or your broker volumes or was it basically one and the same?

It was basically one and the same. Joe Box – KeyBanc Capital Markets: Great, that’s all from me. Thanks.

Thank you.

Thanks, Joe.

Your next question comes from the line of Michael Hoffman with Wunderlich Securities. Michael Hoffman – Wunderlich Securities: Good morning and thank you for taking my call.

Hey, Michael.

Good morning, Michael. Michael Hoffman – Wunderlich Securities: How are you doing, David, Jim? Can we just push on the volume subject a little bit? I get the model. You are going to push price and you are willing to push some less marginal volume away but if I look at the business that you have got in place and kept to customer what’s happening on the volume and those customers?

You mean As far as weights or…? Michael Hoffman – Wunderlich Securities: Yeah like I mean it’s like in your front end water business are you seeing container rates starting to rise? Because I wouldn’t think you would push this pricing forever if you didn’t think the macro volume environment was gradually improving as well.

Yeah I don’t think there is any doubt that we’re seeing improvements in the commercial line of business. Again it’s not dramatic but it’s consistent and so we saw waste up frankly across all of our collection lines in the quarter, obviously was a very wet quarter so that added some to the waste. But the other thing that is very encouraging to me is what we mentioned about service increases and service decreases for the second quarter in row we’ve seen service increases outpace service decreases which tells you that, yeah there was some wet weather in the second quarter but we are seeing the customers start move up to larger containers. So again like we said in the past we’re not going to declare victory it’s certainly a long slog for us to get there but in the commercial line of business we actually are seeing some very good sign. Michael Hoffman – Wunderlich Securities: And then if I parsing the customers at the land fill so third party delivering C&D is that on a rise which would be consistent with the sort of improving construction environment?

Yeah we saw C&D volumes up in the quarters I recall around 4.5% that side, yes 4.5%. So across the land fill we’re seeing actually very good volumes. We saw volumes up nicely on the MSW side, C&D were both up. And so if you look it comes back to what I said in the script. If you are going to add volumes let’s add them in the right line of business and if you’re going to be aggressive on the pricing must be aggressive on pricing in those low margin lines of business where the only way you are going to drive look it takes a long time to drive cost out of this system. And so you are never going to get margin expansion if all you are going to do is drive cost. And so in those low margin lines we absolutely have to raise price. And like I said the five to one trade off in a 20% line of business is well worth it, when you think about residential line of business call it 10 to 15% margin. If there was 10% margin customer you can gain 1% volume and 1% price and lose 10% of your volume and still be equal. By the way price comes without any capital investment. So this is, Michael this is not any different than what we did from 2004 through 2008. It’s what I said – script I think we got the message to the field a little bit mixed the last couple of years and we got them unfocused on price and cost. We got it back. You saw some progress in it this quarter. We still got a long way to go. But I think you are going to see it accelerate throughout 2013 and 2014. Michael Hoffman – Wunderlich Securities: So where I would connect the dots between your comments and my question, there is a point of operating leverage it just starts to accelerate as macro volumes continue to improve, you continue to be successful on this price as well as the discipline around the G&A what’s your thoughts about the visibility on that? Where are we, are you away from that we just – away from that where is that?

Well look I am encourage that we saw the EBITDA margins turned positive this quarter. Look I will tell you Jim talked about the flat SG&A guidance for the rest of the year. Jim Fish and Jim Trevathan have done a phenomenal job on holding the line on SG&A cost. So I don’t expect to see SG&A cost to go up materially this year or next year frankly. And so we got to drive operating costs out of the system. We’re starting to get a little bit of traction on that. And I think what we saw was look the biggest leverage is always going to come from yield in this business and I think you saw start to get some traction back in that in the quarter. So all we need is for the economy to continue to improve so that we don’t the dramatic volume drop as we saw in 2009. And I think you’ve begun to see the leverage in the operating model I think you should see that accelerate in the next 18 months.

One quick point Michael on operating expenses as David talked about I mentioned that a big slog of that operating expense was related to I think when you think about the leverage going forward if we can’t squeeze that operating cost out that’s related to this quality control from China and we plan to pass it through to our customers. And that in itself helps us to reduce operating expenses as a percent of revenue.

It’s a great point. Every penny we improve in recycling drags straight through the bottom line and there is lot of room for improvement there right now. Michael Hoffman – Wunderlich Securities: Okay. So my last documentation on this, it sounds like if I take the bonus accruals for this year plus the headwinds from bonus depreciation but net it against the success you are having on G&A, pricing and operating leverage, you should be able to produce flat year-over-year free cash flow maybe even a teeny bit of growth given those two cash headwinds.

You know Michael we are waiting for 2014 to give the guidance but look I said all along this is a business that should generate $1.1 billion to $1.2 billion the free cash flow come hell and high water. You know look we didn’t do that last year, that’s not going to happen again. The other thing that I can say that Jim and Jim have been phenomenal at is the capital discipline and we are going to manage the capital such that we make this at least to $1.1 billion to $1.2 billion free cash flow company every year come hell or high water I wouldn’t expect that to change next year.

Michael did you say we are flat for 2014 versus 2013, are you saying flat? Michael Hoffman – Wunderlich Securities: Yeah.

All right. Michael Hoffman – Wunderlich Securities: Yeah flat so in ‘14 you should do 1.1 to 1.2 again even with those headwinds given the leverage from your price and your cost controls.

Yeah I just want to make sure because 2012 to 2013 there is going to be a dramatic improvement in free cash flow.

All right Michael, you snuck 2014 guidance out of us but I will give it to you. We are going to do at least 1.1 to 1.2 in 2014. Michael Hoffman – Wunderlich Securities: There you go. Thanks a lot.

Your next question comes from the line of Adam Thalhimer with BB&T Capital Markets. Adam Thalhimer – BB&T Capital Markets: Hi, thanks. Good morning guys.

Good morning.

Good morning. Adam Thalhimer – BB&T Capital Markets: The green fence cost do you think that is permanent and how long should it take to get to pass those cost on your customers?

Yeah you know we have looked a lot at this and as you can imagine it’s been a big topic of conversation and you know there is so much international trade involved that it’s hard to get really good visibility but we have sort of decided that we need to take the approach that it is going to be if not permanent at least long term. You know we can’t sit back and say well we are just going to let the business continue the way it’s been in the past and wait for the green fence to clear and everything is going to be alright. We are not going to take that approach. And if we are not going to take that approach we absolutely have to start driving cost out of the system and going back to our customers and getting our customers to pay for the increased cost that we are incurring for the reduced commodity prices. So you know look I will tell you I don’t even want to try to put guess on the timeframe to when recycling gets back to where we wanted to be. All I can tell us is that we need to see incremental improvement every quarter and we got the plans in place to do that. Adam Thalhimer – BB&T Capital Markets: And how are the recycling contracts structured? I mean how? Do they come up once every five years so it’s hard to push price or how hard is it to push price I guess is the question?

Yeah I mean it depends on the customer, right? So we have got plenty of commercial recycling customers that are just like our regular commercial customers where we can change the price immediately and then we got other customers that are municipal customers where the contracts are going to be more to three to five year type traditional municipal contracts. And so what we have done is we have asked every one of our operations to get their top contracts. Let’s start with those, let’s go with the dollars first and let’s go to our biggest contracts in every one of our market areas and start going to those customers and you know most of those contracts are going to allow us in some manner to either pass on increased price lower rebates or high processing cost and so let’s go after the big ones and let’s make sure that we go out and talk with those customers to cover our increased cost. And then on the other side the non-contracted customers like our commercial customers we run a couple of pilots to look at what we can do from a pricing point of view there and we are going to spread those across the country. Look, from a commercial recycling customer point of view it’s going to be a lot of places where they are going to have a decision to make. They are either going to have to pay us more to recycle or they are going to have to move back away from recycling and just use disposal can and so we got to do that. It’s certainly not something that we relish doing but you know we need to have the customers to make the decision on what they want us to do from a recycling the materials point of view.

Adam, one quick point here on these contracts. Well it may sound difficult to change the price, many of these contracts have residual percentages in them and many of these contracts have composition components to them so we’re going to go and look and see whether and we’ll hold these customers for their contracts. If their residual percentage is 10% and we’re getting 20% ahead of their contract then we’re going to go back to them and have a discussion. And similarly if we expect to get the certain percentage of glass by weight out of a municipality we’re getting a much bigger percentage of glass. And then we’ll also go back and have a discussion with them. Adam Thalhimer – BB&T Capital Markets: Hope you’re successful, right. Because that doesn’t seem like the trend is going to slow down. I mean imagine your commercial customers are going to continue to recycle. Just the matter of you being able to push price, right?

Absolutely they’re going to continue to recycle and we look forward to help them recycle. Adam Thalhimer – BB&T Capital Markets: All right. And one more question I hate to ask. Because I know you’re not focused for analyst trying to plug numbers into model I mean more of your thoughts on volume growth in the back-half.

Yeah, obviously no one knows of the future holds. But beginning of the year we said we were going to have positive volumes obviously in the second quarter. What you saw in the second quarter was recycling driving the both of the – I don’t know if we got the number yet. But we saw recycling driving the bulk of the decrease in volumes and the only other line of business where we saw negative volumes on the roll off side where volumes were negative 1.2%. Now about half of that was the anniversary of the large national account that we brought up. So it’s not like you’re seeing volumes follow up the face of the earth and sort of like that. But we didn’t expect the volume decline in recycling. And we don’t expect to see our roll off line bounce back to where we’re getting usual cost of volumes because we’re not just going to change the margin of business. So for the back half of the year I think we’re looking at volumes similar to what we saw in the second quarter. But look basically what you saw in the second quarter is our volumes went down 0.5% and our price went up 0.5%. And if I can get our price 0.5% and our volume down 0.5% I’ll take that trade off six days to Sunday. Adam Thalhimer – BB&T Capital Markets: Okay. Great color. Thank you.

Thank you.

And your next question comes from the line Jeff Osborne with Stifel. Jeffery Osborne – Stifel Nicolaus & Co.: Good morning two quick questions for you David. On the green sided the rules have been in place for quite some times. My understanding but is the enforcement from China stepped up over the past couple of months. Is that part of the issue of play here?

Yeah with the change in premiers in China you saw, early this year you saw basically a declaration by them across all sort of type of environmental initiatives. And so even though the regulations been on the books they finally just passed I mean not just passed they just mandated that they’re going to enforce those regulations. Basically in February this year. Jeffery Osborne – Stifel Nicolaus & Co.: Understand. And then on the M&A side just what you’re seeing out there in terms of either tuck ins or potentially getting the oil and gas which I think you talked about at the Waste Expo conference.

Yeah. We just closed as we mentioned our RCI deal in Montreal that was obviously a fairly a large deal for us. Other than that we’re just looking at sort of our typical smaller tuck in acquisition. On the oil and gas side we closed the small acquisition there. We’re constantly looking for further acquisitions. But that’s been a fairly pricing market. So I don’t anticipate that we’ll spend a lot of money there. At this point in time I’d say we’re through the largest acquisition that we had in the pipeline. RCI was basically the final one of those. And now we’ll back to sort of our typical $100 million to $200 million of tuck in acquisition. Jeffery Osborne – Stifel Nicolaus & Co.: Very good. Thank you very much.

Thank you.

Your final question coming from the line of Al Kaschalk with Wedbush. Al Kaschalk – Wedbush Securities: Good morning, David. Good morning, Tim.

Hey, Al. Al Kaschalk – Wedbush Securities: David, in terms of – I apologize I joined the call late. But have you commented on how the integration of RCS is going I know it’s one month. But could you just comment.

Yeah, we didn’t specifically comment it. But what we got in Montreal is that we have fairly small collection operation. And so we’re basically tuck in operation into RCI. So far that’s gone very well. RCI had some very high quality management there. So they’ve done a great job of tucking our operations into theirs. Al Kaschalk – Wedbush Securities: And the interest of the acquisition was largely predicted on what. In terms of the opportunities that you see going forward. Besides that previously having a lot of collections operations there.

Yeah, I mean Montreal was a very fairly unique market for us. In that we had a lot of disposal capacity. But very little in the way of collection operations. We tried build up those collection operations over time but frankly they got some, they have one spectacular company there in RCI that made a difficult for us to get into the collection business and so we had a landfill that pre-recession was actually find because there was an excess of tonnage in the market and our landfill is fine. After the recession frankly there wasn’t enough a tonnage in the landfill in the market to fill all the landfill and so we had a choice to make. We could either get deeper into the collection business to help feed our landfill network or we were going to see volumes deteriorate at our landfill and we were going to be at the mercy of other collection companies. And so it was a perfect tuck in acquisition for us it’s a great market we’ve been looking at it for a long time – I’ve said earlier ran a great business and we look forward to continuing this success. Al Kaschalk – Wedbush Securities: This is an MSW landfill David or is there other ways can take?

No, it’s MSW. Al Kaschalk – Wedbush Securities: Okay. And then finally if may and sorry this has been a topic that I missed. But on the SG& front you have talked about cost savings on the growth side of 120 million you did 10% I believe as a percentage of revenue in the quarter, how much of that benefit lock of better word is due to the lower recycling volumes and how much are you really on track to hit that growth target number?

Due to the lower recycling volumes I wouldn’t say any of its due to the lower recycling volumes. It’s really due to two things, if I say there is several things in play but certainly the restructuring has had a big impact and we’ve kind of gone over and above the restructuring by taking out a chunk of none labor SG&A as well throughout the year. So those are the two big components of our SG&A and we’ve talked about not only holding flat from 2012 to 2013 but looking to hold flat from 2013 to 2014 in absolute dollars. Al Kaschalk – Wedbush Securities: So 353 dollar run rate is what you’re suggesting we should think about in terms of Q3 forward.

Well so Q3 has ad we talked about this a bit earlier but Q3 and Q4 have a bit of headwind with respect to compensation accruals year-over-year. So while we’re up for the first two quarters of the year we expect we’ll have a little bit of headwinds and that’s why I think where we’re comfortable saying that we’ll be flat year-over-year. Al Kaschalk – Wedbush Securities: Jim my point about recycling is that. If prices are down then I would think that would hurt the operating margin on that business and there may be some I won’t say idle cost but let’s say not fully utilized cost. And that’s what I am just giving trying to getting to an EBITDA margin of 25% I think is above that is easy hurdle. And then we just didn’t see the progress in the quarters. So I am trying to decide for that whether that was an SG&A or an operating cost?

It was operating cost at our recycling operations. We remember that had a 90 basis points effect on margin. So it was purely solid when it comes to recycling basically the breakdown you had is it the both of the problem with pricing and was pricing commodity pricings down 12.5% for the quarter. Next was operating cost, operating costs are up because we have to get lower residue and then you have the volume and the integration of the acquisitions pieces a little bit small pieces in there too. So look at the two bigger things are price and operating costs. And those are two things that we can affect and recycling you can affect from price by going and looking at rebate you can affect operating costs by driving the inefficiencies out of the system. So that’s where we’re focused on recycling. When we talked about margin expansion we are 20 basis points of EBITDA margin obviously that would have been back over 100 if we’ve gotten just flat in recycling. Once we get to the point where we are positive from the recycling operations that’s when you really see the leverage there. Al Kaschalk – Wedbush Securities: Okay. And you’ve looked what’s the assumption on commodity price David or Jim for the sort of back half of ‘13?

We expect to be pretty much flat for the rest of the year you had to make your run up and we’re expecting it sort of flat for the rest of the year. Al Kaschalk – Wedbush Securities: Okay. Thanks for taking my questions.

Thank you Mr. Dave Steiner, do you have any closing remarks?

No, thank you all for joining us in the quarter and I know Jim and Jim will be out on the road in New York next week. So look forward to seeing you out on the road.