Summary of WASTE MANAGEMENT INC

Results of Operations and Financial Condition, Financial Statements and Exhi

Item 2.02. Results of Operations and Financial Condition
Waste Management, Inc. (the "Company") issued a press release this morning, February 12, 2009, announcing its earnings for the fiscal quarter and full year ended December 31, 2008. A copy of the press release is attached hereto as exhibit 99.1.
Additionally, as previously announced, the Company is holding a conference call, open to the public, to discuss these results, from 9:00 a.m. to 10:00 a.m. Central time this morning. The call will be webcast live, and may be heard by accessing the Company's website at www.wm.com. You may also listen to the call by calling (877) 710-6139 and entering the access code 80418207. A replay of the conference call will be available through 4:00 p.m. Central time on February 26, 2009. The replay of the call may be heard over the Internet, by accessing the Company's website at www.wm.com, or by telephone by dialing 800-642-1687 and entering conference code 80418207.
On the conference call, management of the Company is expected to discuss its results of operations and projections using certain non-GAAP financial measures that are disclosed in the press release attached as exhibit 99.1. The Company has provided an explanation of its use of such non-GAAP measures, as well as a reconciliation of each of those measures to the most comparable GAAP measures, in the press release and the schedules thereto.
Additionally, it is expected that management will discuss the effect that lower prices and demand for recycling commodities had on the Company's results of operations. Management believes that providing results of operations without the effect of recycling is important to show investors the significant impact the markets for recycling commodities have had on our business. Shown below is a reconciliation of the Company's reported net income and diluted earnings per share to the as adjusted amounts (in millions, except per share amounts).

                                                       Quarter Ended                          Quarter Ended
                                                     December 31, 2008                      December 31, 2007
                                               After-tax           Per Share          After-tax           Per Share
                                                Amount              Amount             Amount              Amount
Net income and Diluted EPS, as reported       $       218         $      0.44        $       309         $      0.61

Adjustments to Net income and Diluted
EPS:
Multi-employer pension withdrawal costs                13                0.03                  -                   -
Landfill operating costs - changes in
risk-free interest rates                               16                0.03                  -                   -
Benefit from income tax related items                  (6 )             (0.01 )              (31 )             (0.06 )
(Income) from divestitures, asset
impairments and unusual items                           -                   -                 (7 )             (0.02 )
Labor disruptions                                       -                   -                  5                0.01


Net income and Diluted EPS, as adjusted       $       241         $      0.49        $       276         $      0.54

Further adjusted for negative impact of
Recycling                                              38                0.08                  -                   -

Net income and Diluted EPS, as further
adjusted                                      $       279         $      0.57        $       276         $      0.54

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Management also will discuss certain operating margins on an adjusted basis. By excluding items that we do not believe to be operational in nature, investors are able to view the business in the same manner that management does and evaluate our performance without the effect of costs for items we do not believe are indicative of our performance.
Shown below is the reconciliation of income from operations as a percentage of revenues on an as reported basis to the adjusted measure management is expected to discuss (in millions):

Adjusted Income from operations as a percent of Revenues

                                                                               Years Ended
                                                                          2008              2007
As reported:
Operating revenues                                                     $ 13,388          $ 13,310
Income from operations                                                 $  2,234          $  2,254

Income from operations as a percent of Revenues                            16.7 %            16.9 %

Adjustments to Income from operations:
Multi-employer pension withdrawal costs                                $     39          $      -
Landfill operating costs - changes in risk-free interest rates               33                 -
(Income) from divestitures, asset impairments and unusual items             (23 )             (46 )
Labor disruptions                                                             8                37
Restructuring                                                                 -                 9

As adjusted:
Operating revenues                                                     $ 13,388          $ 13,310
Income from operations                                                 $  2,291          $  2,254

Adjusted Income from operations as a percent of Revenues                   17.1 %            16.9 %

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