ECOL - Earnings call transcript Q1 2020

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Operator

Good day and welcome to the First Quarter 2020 US Ecology Inc. Earnings Conference Call. Today’s conference is being recorded. [Operator Instructions]

I would now like to turn the conference over to Eric Gerratt. sir. ahead, go Please

Eric Gerratt

thank joining and today. you morning us for Good

is call Chief Joining the morning Chairman me on Feeler. this and Jeff Executive Officer,

from such we or of not of actual the materially materially discussed not that Factors and conference are Before those cause expressed in and results the statements. COVIDXX the forward-looking impact include note uncertainties uncertainties, Securities contained Litigation but defined implied forward-looking with microeconomic please this risks Reform are from results our statements our for Securities end XXXX. in specific risks of but Act impact not include statements limited certain as differ which limited pandemic on to call in markets Since could historical those to company's results differ and those describe statements do by may in also These Private statements the Exchange regarding business, and expressed facts XXXX. we are that Commission. the that continued filings operate to the begin include

future predict statements or undertake obligation forward-looking management's whether many statements forward-looking statements, any to forward-looking only a or make reflect other that date results. Listeners determine control statements We or as should reliance not which cannot Management of views the update any on on are events future information, made. place such undue factors revise new no or to otherwise. result

with presentation. those webcast For follow joining by can today's you along

those on today's our presentation by website can www.usecology.com. you access For at listening phone

flow earnings in Generally metrics earnings cash refer we per earnings Slides found calculation our are and EBITDA adjusted These Slide therefore adjusted free cash definition, XX A adjusted and earnings Accepted and XX EBITDA, of release calculations. not diluted can per and cash free to share, be share today, yesterday's presentation statements on Throughout are earnings the Principles with determined diluted and diluted Accounting varying accordance financial reconciliation share, and diluted cash to susceptible share, today's presentation. per of flow. adjusted call adjusted to per are adjusted through

believe results Group reported results. We quarter November as from to evaluating non-GAAP We the include first point NRC in this would acquisition like to that contribution X, Holdings useful out that our closed Group presentation NRC are these often also Throughout Holding's XXXX. we NRC. on refer our metrics

legacy is provided data, stand-alone legacy We on as for transparency a US an basis which Similarly to US have of data standalone we to for NRC Ecology, is provide understanding attempt disaggregation referred NRC. Ecology. This underlying group as increased refer also that business. to the and

like to that I'd to the Jeff. turn call over With

Jeff Feeler

are Thank Eric difficult I you, stations good safe your these and staying everyone. hope you and morning, families times. during

address Ecology first Before pandemic US the how responding to I'd Eric and have to review like is results, I it. quarter the coronavirus

For please Slide attention your those are that following to direct Five. the webcast presentation,

We the pandemic no are is humanity Ecology in all unprecedented with and US COVIDXX affecting exception. times

Our those hearts to impacted. out go all

are keeping thoughts missed to offer conditions. Ecology's that includes this the rapidly and beat that safe members essential I us unparalleled special a You a to and changing, and despite thank are not service have need you our in stressful team in all and that prayers. time providers XXXX want US

In been more these unprecedented our has our important. times, and never focusing value core foundation on upholding

human is to which the provide safe our health to environment, exactly compliant today. fact, In mission been protect what is needed and and solutions has always

operate. protocols the importance. we our Throughout throughout this core taskforce our communities swiftly address Moving HXNX. members, deployed safety that part crisis management take SARS and priority in experience Bolus, off matters process, and live immediately Six on of action and our crisis to based is At COVIDXX safety applied a Ecology. with of number customers Slide our which This is US team at we organization is to our DNA the one to of extensive our start we a the mobilize and this

XX% and off team benefits special time home work extended We mobilized to our our from COVIDXX to of workforce members.

critical were constant in been at communication expanded have all protect during networks throughout using this and the ensure times. We personally use and they We organization, can established to members, our and secured professionally valued to information crisis message PPE sourcing our properly providing our to protected and teams others. themselves customers that sourcing and team mobilized

teams while With security, our our where perform homeland business plans we deploy decontamination deemed field to cleaning we implemented projects services we operational essential continuity needed. ensure remain by to

business. done of was All this while day-to-day running the

can first growth quarter As and from to million, our company on services energy Seven we during EBITDA operationally revenue results our impact other was XX% in Slide grew COVIDXX $XXX.X you $XX.X million Total little a to million. we see our cash adjusted adjusted business. flow $XX.X free saw than saw our

business had quarter. outstanding Ecology US legacy our Eight, Slide an at Looking

business with Services base business growth and XXX%. XX% Our Environmental of grew growth segment of X% event

Our field up strategy program business driven generation retail and implementation of program. the grow small of by solid national execution our of to services business, our laptop XX% our our and quantity led industrial was by our success

to in Factoring in margin grew $XX EBITDA segment million. XX% expansion over adjusted XXXX both QX

decontamination and environmental revenue $XX.X in performed experienced first in most As the services in uptick contributed million Slide during markets shown on Domestic quarter. COVIDXX services an March. Nine NRC in well

impacted was our and the solid quarter standby Our beating a not retainer performance, during first by expectations. saw base COVIDXX own the pandemic business

prices drove These truly upstream will charge, a us non-cash value production a Despite the with the of more we during events by taking The million in impairment in underlying quarter opportunities the there, oil weakness direct the COVIDXX belief swan resulted $XXX the growth in the and lows. horizon. black services worsened historic of be the just we markets the time strong goodwill have a impact over this longer charge. the believe assets, serve compounded to energy that pandemic,

Despite on the creating EBITDA impact its is crisis delivered economy our markets in million evolving of negatively impact many of quarter. our global NRC will these quarter. second health $XX.X results, uncertainty Overall and during and the the adjusted strong

announced at reduce of end safeguard the on proactive prudent and March, our strength outlined we to adjust the result, plan the company measures to as costs order a XX. financial Slide As in capital of to spending operating and

capital million initiatives preservation to included a Our expected capital reduction XX% cash. approximately planned of XXXX $XX our up expenditures, to to save of

year. million to dividend discretionary compensation, deferment additional an and Additionally, approximately will the elimination including our the spending, variable cash million travel, $XX the preserve of quarterly the of controls hiring of noncritical balance save of suspension activity, in for reductions Cost $XX $XX million will

of those positioning million cash these our limiting market providing us to cash of financial credit, advantage to withholding further when XXXX expected These cash more opportunities rebounds. actions sheet taxes approximately $XX to and workforce balance generate of additional are $X we to the flexibility taking talented off generate are take than savings providing $XX These $XX preserve by staff capacity. reductions of operational navigate of flow times. million our of advantage the drew to our we while as strong additional actions leaving cash flexibility of supplement adding unprecedented its generation, the we deferral while million furloughs anticipated and additional line also Furthermore, savings in million

the Slide guidance year we in for did As the XX COVIDXX late pandemic, to XXXX. withdraw the duration uncertainty covered on full the of due March and surrounding magnitude

we our will the XXXX, services facilities current further collection business resilient business Looking that conditions of model. market primitive into expect due the environmental weather irreplaceable, to and

response opportunities service and are this during decontamination should Further, many on we seeing that business Execution from continued -- work growth program our softness. feel some benefited of of industrial emergency the increased offerings help offerings our offset has retail field the strengthen service time. COVIDXX and

challenging will balance business, be of negatively Our in operating extremely energy waste XXXX. impacted the conditions is disposal services which for

are our began that states We businesses. their restart to will hopeful when customers reopen,

especially in seeing or already has are either in markets plan those reopening increased is positive commenced of near-term. where signs the We to activities,

expect half will the second strengthen industrial starting approach a of activity second also overall through phased-in that end May the We of towards to the there quarter be the year. leading in gradual

the at below believe As a second year. be quarter that of time will this result we point

Looking accelerating of touring the volumes we the data, waste reduction at and in and starting end a recent April. at started most into March seeing network

were base XX% for sequentially is by with Our line to what in business down both approximately XX%, we March and year-over-year which volumes April expected. had

XXXX, Our March event from to up when however sequentially slightly down XXXX. business X% April compared was

states base which expect We reopen industries. pace our than and business to to at and earlier businesses recover our services other customers expect the of reopen

a our event healthy have May in where deferment with been only pipeline. of have little business April and seen pushed projects have a we already from summer into that handful the we far So

Overall, positioned now, right quarters. will have into shift believe our As as lower-than-expected emerge. most even for cash business in and event fourth I we've would be the seen taken, this the to flow positive we be pipeline year-over-year to we activity continue free levels. expect of actions is adjusted generate with the it significantly even shutdown, third at of EBITDA the a bidding impact company healthy and will

to the to strong these clarity recover. workforce, available earnings of provided capacity company's not In guidance, As guidance, second committed a the free to begin flexibility cash we by to and to on the our us company liquidity, expect model, those reestablish flow conditions hand to challenging cash quarter growth refresh quickly for our summary, enough continued capitalize and opportunities on as navigate generation, at the our XXXX do while position lines release. times of and on have time we financial credit of enable business guidance will business

With turn Eric. that, I'll it

Eric Gerratt

your lines. would everyone echo I Jeff. earlier our on you, outstanding like Thank team front the comments the of to and about work

the As quarter. that financial for before include be results I I legacy review, results NRC consolidated go US detailed the discussing Ecology delving the will into into standalone

NRC. for with Slide XXXX compared first NRC, results environmental in for XX% from services up increased revenue, $XXX.X the XX $XX.X million million the to segment from quarter quarter year. million quarter year on including $XX.X included same the the which to Starting and first XX% Revenue $XXX.X $XX.X million million was from last consolidated of last

in Services segment of services Total of and first the and and million the $XXX first the from segment for XX% of of $XX.X XXX% margin was was quarter both included field quarter XX% our gross the margin The $XX.X first quarter and from in Environmental up in XXXX. was XXXX down XXXX. of of from first of in industrial quarter million Treatment revenue XXXX quarter quarter XX% This first first disposal XXXX. in XXXX the the NRC. million delivered

and first quarter margin million million the XXXX. Gross the the excluding Selling, or well included as consolidated favorable last first and integration million for of in development year recoveries services the first $X.X XXXX business of to not This quarter $XX.X for spending $XX.X in when compared and million insurance first XXXX. general of quarter in in and compared to property our segment that million NRC was SG&A industrial quarter XX% expenses. administrative were $X.X repeated $XX XX% of field in was as the

non-cash to the global flows our million first Jeff a to we market oil non-cash charges and supply As expected the goodwill This energy waste associated on international was and mentioned, of the related impact and negative quarter business. our cash future in demand directly businesses. recorded the XXXX charge each services related of in $XXX.X of the impairment disposal shock

in assets adds in X% per share earnings the Cash compared first $X.XX which first in year-over-year was amortization XXXX per intangible $X.XX compared XXXX, of XXXX the same which represented to year. share quarter to the first quarter Adjusted quarter $X.XX in growth. back of of diluted diluted last to $X.XX the was per earnings adjusted of earnings share quarter the

the as adjusted from of last was XXXX Consolidated strong the up by $XX.X well XX% the of quarter year, first NRC. same US EBITDA Ecology growth addition reflecting million Legacy in period

in of Shifting results million first quarter on XX, up $XXX from XXXX quarter million Slide were to XX% Legacy $XXX.X year. last US in revenues the Ecology first the

and revenue. XX% XX% million transportation Services Environmental treatment revenues a increase XX% were $XXX.X Our and on a up revenue to in disposal increase in

quarter XXXX compared business and our X% in first the XXX% first quarter the last was to base year. of business Our event up grew

the quantity was the from quarter XX% in of was line. million Legacy generation US the the industrial first field up business in service last XX% Ecology year. US services for quarter by primarily revenue increased Legacy XX% small up XXXX in margin in driven revenues $XX.X and of XXXX quarter Gross our Ecology and first first remediation

Idaho by recovery. the along expanded event the segment XX% Services points view base business grand disposal Environmental of basis first Our treatment and margin quarter to and with the XXXX XXXX first to of on nearly compared XX% XXX quarter increased an in in

Gross in the XXXX US first the first industrial quarter by for in XX% compared to of quarter margin XXXX. XXX Legacy points the Ecology segment services X.X% of expansion was expanded for basis well and $XX.X margin as compared field US in SG&A is Legacy mix $XX.X density. service This the last million to quarter improved the attributed first as to route million year. Ecology business to

SG&A a reflected reminder of insurance repeated for a favorable the As quarter $X.X first recovery that not quarter property the in XXXX million first of was XXXX.

quarter The XX% up integration XXXX first year. compared $XX was million when costs. from percent $XX.X the revenue last XXXX improved insurance quarter XXXX. both to basis the of first expenses and $X.X US XX to as compares periods. for and quarter of total XX.X% also as first the million by of million property due in increase to for adjusted development business labor business of well the of and in expenses first SG&A was development and Legacy a insurance increased Ecology This partially excluding to integration SG&A as EBITDA quarter to gains points

Slide quarter to XX, of at Turning XXXX. balance $XXX XX, sheet of net solid liquidity. we We and cash and million had exited million borrowings with $XXX a strong March the

was year. $XX.X to during quarter million flow XX% driving in our million last same quarter up up the to cash flow adjusted million free operating the Our compared XX% to $XX.X cash $XX.X

matures our million The loan at with debt revolving rate in is XXXX, position XX, have Looking approximately line current approximately term of B our debt as as at well XXXX. available $XX of $XXX.X remaining that interest average March our a million cash X%. overall we million capacity on on $XXX overall credit

or cash with repayment. million amortization B Our structured is year term $X.X lower of financing and covenants loan no financial X% in acquired only per

credit XX credit well Our to our and covenants institutions coverage and covenants; our with capital limited have calculated adjusted of of revolving X.X This syndication interest quarter, leverage two bank financial we end the a facility debt ratio first leases were as long-term with we month facility EBITDA four within relationship. which ratio. trailing has to our under is At strong an a times. highly total a as the of outstanding ratio well leverage capitalized times financial

initiatives cash balance just us preservation along compliance capital Our free to earlier our for is the generation of discussed allow XXXX. expected covenants flow remain to in expected with with debt

with the discussing and or banks and our waiver However, obtain if outlook the the a with leading to potential we are needed. amendment covenant proactively environment current syndication's are comfortable

the despite will long-term market liquidity Overall, conditions our and pandemic, to current the solid to focus. us allow COVIDXX and with a strong operate sheet continue business balance

back With that the I'll turn call to Jeff.

Jeff Feeler

Thank Eric. you,

shape times, recovery, the flexibility on be diversity industry-leading allows in improvements and be focused of these advantage challenges. navigate our Having financial sheet take operational us the team. the will long-term and customers and position to initiatives, generate talented us of to despite to and puts while to company highly these While continue unprecedented strong business, liquidity position, cash excellent to our balance able protecting

Actually, of are efforts. many to with acceleration complementary and continuing despite the to is value needs. in leading of combination at coming we our offerings our teams synergistic footprints is service are times. redeploy service The to The the these seeing an pace trying had diversity as the best together have workforce our our we of integration customer's integration NRC and ways

in a full the effort breadth commitment of thank group I'd excellent preservation operations This throughout on together financial and stewardship control, leverage their of to strength well is we unit. recovery the stakeholders including and behalf positioned members to all extraordinary and benefit to focused to the servicing we're closing, of when that those emergency our our like organization their believe singular and response sustain trying most remain from We on unwavering team to of the customers new can really work our enabling our times. as things In our happens. the

With for questions. that, open we'll operator it up

Operator

instructions] [Operator with Stifel. Hoffman begin And with Michael we'll

Michael Hoffman

is there a decline? down, from production win exposure concentration level to refund. helps auto a is an XX are got auto to You employ of something us issues? there big business a understand as that corporate base the geographic example Is is that and down a big In you particular industry there XX synergy to there like or why

Jeff Feeler

a that things so Yeah couple on Michael.

data, into that and correlate to volume want foremost take there. Doesn't is it account account pricing, revenue this point I doesn't necessarily First on doesn't into take out. because it mix

not always know So equal discrete on as you there.

So this we wanted provide to us for. get to data

severity manufacturers smaller ones to presence. se in down it and more seeing the gained of is traction lot than When started definitely be this kind down close line had the to of to presence per the of as this we in a expectations. going be are really line pandemic and our are of going an unfold, forced industry A March geographic

and up took than much So say Canada we marketplace, a a Texas for in more our we markets severe Canadian example approach our decline saw more marketplace. have in those

And it's exposure, impact depended but and be in greater area. some do associated area to expect declines going yeah herein that this to there as all some to actually Michigan open at. in starting those the are or auto week next. on plans on we see The is that it's where so up that services our recover Did

in on there. we're So track

April reopening we start would just couple and probably of that's we continue what points it that to a kind may see have the into there, decline happen. will So expected phased in as

Michael Hoffman

volume are less in I the And am so revenues equal decline. the revenue than that volume assuming

Jeff Feeler

expectation. would that my be That's right,

Michael Hoffman

proportion that Okay. And a you help can us bit? little

Jeff Feeler

Yet in for worked haven't early have revenue April. Yeah. we We May. don't numbers

comes it into So we on be the one a to but second able give able you we'll sense when quarter. to that more were report

Michael Hoffman

that mixed. this results the adjusted on that then Okay. biggest retail were your one its company competitors morning Fair sold retail and and pack in of lab enough call

terrible. some great curious what your has of I'm area been was and experience been that business in focus. because it's Some was an

Jeff Feeler

Yeah.

some retail the we've into growth open did cosmetics were majority have continued remained that, apparel into continued that that QX from standpoint. that -- offerings and and essential. actually so our that of in For say to vast anything QX seeing things they from deemed rates to in or shut tied customers volumes. the had all April customer service We or in We strong that very sector, were not were down they increase

service store pickups, grocery They didn't shut get the throughout most and we States. the we of down but those United chains

of remained open treated like stores also have saw as being they to They larger those will and things volume additional thrown and on that, in We in the think trying hardware that ultrasensitive it all put they volumes type be to figure just some just having increased opposed transactions. I protocols out.

in well time the saw we as during So increases volumes period.

Michael Hoffman

and And you industrial us services -- it's you’ve the in you make to been frame it? so can see I what alluded I can then for am line can field you and seeing sure if doing all

Jeff Feeler

and is in majority services of cost centers or revenue It centers and field there. the all Yeah. line that NRCs vast fall industrial in the

So to preventative are retailers it's open. cases to buildings, from doing where go providing what response contracts, government often to in been Decon there's Decon a people getting now commercial ready decontaminate an to contracts that. that to services initial to we're everything kind known We're and emergency changing to providing of contamination we're and is services or where government

probably XXX and first teams. and on quarter we $X so of actually we to that end grown reopening emergency perspective framework this morph their We've million good about that in seeing in in with From area. did and one it's of and the responses that response April. has about experience done NRC probably through acquisition options experience more by gained and the emergency April It we comes work vast the in that's our been business from tight go for the as start preventive an reopenings will to continue a a

Michael Hoffman

that as can and line of above of corporate And that margins we think corporate margin? in

Jeff Feeler

emergency on talent, margins the as can to segment long when majority above we internalize average comes response as we Vast that. get can it

yes, we So and that for is us expect business to good continue. that would is something

Michael Hoffman

those the had challenges covenant taking. talked you Eric any being conversations, me. labor all given for one your you anticipating but prudent last not in is you're you're the on actions having And

Jeff Feeler

the and different Yeah, most to and that sorts at like this how long point we're am is like picture depending the of and are sure not, shutdowns all companies we slowdown the I but be that things modeling scenarios and you on scenarios. and a dire doing to something how it model

are So trip on we scenarios scenarios. some these the of do get close those or covenant. Again

So to of keep but proactive this at that I are have it's to I we're don't and we I do tip likely the that out on an us something just this being it. also in going issue to and near-term anticipate that and seek out way the point, pretty think to headroom give

Michael Hoffman

seeing that kind to what you're the the of at and And moment. gradual, swoosh think is start is like swoosh the making about it fair is way long see a it

Jeff Feeler

the have Canada frame that another pace year. would of we which we've starting vantage see part we start a up, what We of and I the quickly, looking be reopening know US those to seen kind in the first control don't come throughout bringing is see know, kind our even variables markets it is offerings to pace into and in a production later our and gradual but don't the is and service down don't of way. that the customers know volumes just all we of I do start if lot back have rapid There's in waste in of play. on, going on in to we particular there's more what hard on opened if point don't shut expect from of based mean workforce this reopening.

yeah the I it the quarter phases and same through back to look pace, you it improve really at back the the in year, continues thing expect should the year. gradually would second that of the exact if of when up out, As half half

Operator

Markets. to move from Silber with a now We'll BMO instructions] Capital question [Operator Jeff

Jeff Silber

think I answer reopen said the made little it a to you expect and how about your the I color customers mentioned previous service that? you get to mention earlier prepared remarks on other in Can something of you providers? than Jeff question, we in your bit

Jeff Feeler

And we've of lot we made really in overall, economy shut the what's that. comments thinking it had you nonessential get restaurants, waste been down, think really a when don't services, Jeff about from

going of I you kept opportunity such going industrial reopening, open ones, to mean having reopen of what customers especially facilities more than social most them some smaller and about put they better if site. would think could So come as I the they the model, quickly shut and to to when to they expect down have see, not you're distancing, they're coming, in practices they're the safe protocol on putting our

think that companies the So is to service of there. elude open than the more our majority to out customer what I of trying is quickly all why vast will base I'm

Jeff Silber

Got you of other flow perspective waste may a a for on, just is clarifying it. to any but you curious, referring cash thank thought from any companies that collection going I you with your have been have seen lot there obviously customers? I'm issues and

Eric Gerratt

major Jeff is significant pretty something any in it's but we're more or some this this closely. even to place additional something seeing we any to monitoring yet. continue procedures very monitor we no, Obviously monitor point, in place closely To way, and Yeah, process that issues monitor that It's closely. will any we're but it. we've Eric. issues put not Nothing significant

which but as a to at collections, continue DSOs thing, in improved look our If our through go. at we we will quarter if good and quarter, first actually monitor you look evaluate first is again it you the the

Jeff Feeler

rate you seeing any still our be not I'll monitored which closely. now, add, Jeff, to exited cash held the quarter something look it And same April that just out collecting but look tells and with deftly position right signs initial very challenges me at you when we're what we're its the of and that we it's

Jeff Silber

cash. talked kind just million about $X and about deferral XX tax potential you Slide talk the of withholding one saving in cash I in think Okay about the clarification and Great you the when of

that deferring be you're XXXX correct? So of you'll that the payroll now XXXX in related paying is and half tax that second into

Jeff Feeler

so That much. is Thanks correct.

Operator

Bauer [Operator instructions] We'll with Tyson move Capital. to KC

Tyson Bauer

to gentlemen on you've able taken that morning, preserving been very I and approach Good and appreciate cash shareholders conservative protect and to capital. what do a

So timetable The legislation you development it by insulated but somewhat well on side other of are still should are and done have the you of that and business on event a with a insulated that jobs litigation, those completed? still cleanup, lot mandated pipeline create since is it. may also you that either events variation arise somewhat getting

Jeff Feeler

This My has been bumping mind around. is Jeff.

large se. that at for of maybe and actually So the not with a but two year or event we per for related kind sloping, now, business month they're when are all part entered right already some XXXX I indications the of most shifting force look all not the fairly project of out were in that moving, normal course not pandemic

you in continue our a not sites controlled helped which of shut of expect on March see government to and also come the quite those of in bit course is work of through right common we've some look volumes We has at activity, normal through year go around XX%, unknown work filler which XX% business the just normal on and entered we call When has government it course. this April, most down being there. the to that actually that which happens in year or

we most of us has reemergence go. the was now see customers the to telling just customers and areas to that pipeline that May, slipped where to in that we're country those are that out see this still to saying I now and are started things date was been things the most they're of a gear what with to how the monitoring starting And one closely of one sales not ready of there and they're that our We really deferring. was team lot that of as our acting it pandemic and opportunities, of right continued down strong. slipping has seeing and up and April we're starting shut We

monitor in something So it's we year. as cautiously going optimistic see a be the no shifting to to we're going may but definitely that there we're impact throughout right now go we're

Tyson Bauer

we kind pricing there as pricing as Does people a that of that's there, pricing that treating onetime are the should mean big see out and also well fairly one-off a bid your or isn’t hold volumes. that for necessarily event competition

So your given things outlook quicker on up, so kind pricing? as ramp the of

Jeff Feeler

right of great in having as disciplined the changes is rational The bodes just the thing and dynamics as that marketplace I'm some a industry pricing and now, pandemic. very about seeing result well have any the Yeah of players for we pricing. our in so consistency not in

Tyson Bauer

those expectations to on are the on the being just pushed you CapEx volumes The about to to customer related talked right. the

can So you there make be pinpoint easier to? were or decisions exactly some costs allocated will somewhat of those you for to is

Jeff Feeler

Yeah, every of the almost of are cuts board hits really and our key the one areas. most it across

So of control our same energy start were spend of services XXXX that more the business, definitely seeking the spend. we're back there out insurance going was push maintenance capital area and on this probably landfill We disciplined especially in some the into had and half we through to was to the the probably and will type that not for projects out and XXXX. We're some going going rebuild Idaho looking be to growth into that in of for expecting funded the year volumes. plan proceeds we're shift deployment some

that an to was future periods. So easy move

to and the so going we're we so a the something on and have capital do eye to that's term. great We're We're our crazy led And deployment. this they being long all benefits very over long-term keeping still disciplined. not jeopardize are organization and when team be to Bill really it the prudent throughout this capital and comes that and disciplined monitoring and Simon we're going by

Tyson Bauer

affect two, may take but given then is the balance if we looking to any doesn't year will taxes your EBITDA bookkeeping or programs -- see quarter percentage overall sales less cash that cash impact sheet this we should million a Okay. And obviously less that just impact of and adjust Canada government the lastly and taxes? another your $XXX off may volumes have expect questions, from at Eric that

Jeff Feeler

category which our is million of but Yeah Tyson what EBITDA our our what really that asset impairment, it so out impact does on the see in assets. is removes long-term you doesn't essentially $XXX it goodwill goodwill

income back in statement that's then look the So on and balance added calculate closer and piece. how that how the obviously adjusted see GAAP and basis it you GAAP EPS flows operating we EPS EBITDA a income that that you'll at on on if through sheet

balance the accounting though we off be way. we forward going price One allocation since balance or In the acquisition, in will the period that by note have to as we'll in we sheet number during purchase impairment allocation forward technically year, still period terms going our NRC accounting goodwill exercise true sheet this on expecting and up of additional similar true be going potentially continue purchase purchase are the may that to not which any through finalize we're again that right ups, point we'll the to the some there accounting now, at year. this would November this but flowing of additional that are finalize if thing but

Tyson Bauer

anyway want was to on people on the is focus GAAP what earnings. earnings, on we the Once the cash as earnings GAAP which cash to

Jeff Feeler

refresh memory my That's Tyson on question. second and your correct

Tyson Bauer

you're different tax If from you're expectations allocation government any implications have or from to going to have going because the sales. cash of programs various

taxes? you have the which say So won't like cash have implications be tax on rate, you may Canadian what here, what's the than higher

Jeff Feeler

Yeah, in major I our we're taxes, terms think expecting of any don't implication. cash

doing in the to of tax things XXXX. Some from going cash us perspective that we're benefit are a

were that from help defer the perspective. to Some able of we us will things that

were rate In significantly US. we rate the effective not terms in rate, from cash at of the example overall or is for Canada the the in tax different

given how the even slightly NRC lower states higher US are rates par in is of maybe state effective on the their our given fact inventories actually the some rate in US, overall than the the In tax rate. Canadian presence overall of acquisition some of with

not all shift So rate expecting major all, tax Canada. a in in I'm in due events to change or cash our

Operator

a from Raymond take we'll Brown question Now James. with Tyler

Tyler Brown

have in Hey so gave I but that appreciate you of do Jeff event trends color April in April? base you what any did

Jeff Feeler

and X% business slightly up April about down X% from year-over-year. Yeah, was March it around so in event was sequentially

Tyler Brown

be think that And think something then how do about it going all we the to how is margins XX% that? there transportation in to involved we incremental like XX% yes, do in depends about or so on

Jeff Feeler

of be as XX%, that be into incremental comes increase business could first and margin as event the volume that business see with increase the drivers I think in it one margin kind margin definitely really increase that quarter of or event I think XX%. higher was and that then strong improvement year incremental key and see was that base in Yeah, treatment disposal have our you in an and an you the XXX% again with in could you this growth event, when

Tyler Brown

Okay. That's helpful.

Jeff Feeler

grows, event that flows we through. deftly would incremental expect that margin As

the business go obviously we will does cut growth leverage base terms that what there it of way. as operating Now forward, can depending there's in -- the on other

Tyler Brown

decrementals Right base questions that should are business? the the I was more how say book decremental on my

Jeff Feeler

our on Yeah up the a would what they just the the large smaller event again decremental to portion because would I margins probably we've think of over cover than than event fixed base. the on costs be on be the and would base years the base on so the more pronounced see decremental the you incremental built and are

Tyler Brown

Okay. helpful. That's very

Okay. And NRC a step QX in that Could said million you we talking is what way the about $XX in contributed that in millions? might there quarter in think to then like to down I QX? low think ES single-digit but any

Jeff Feeler

about So energy what part waste? are particular NRC you talking of the

Tyler Brown

Yes.

Jeff Feeler

So the we're right in not trends positive energy waste seeing business now.

first that the a positives of a where about really the had well. quarter. from swings down on to perspective XX% year, at what and from actually are beginning we business we of that strong pretty some pretty, the should trending So has margin A and say revenue be big trending part of relatively developed definitely to from profile fairly I we going first as the March is until thought strong lot

looking So breakeven in single to at now almost right for low digits we're that business XXXX.

Tyler Brown

That's EBITDA Okay. they bank feels debt they calculated? in something my something Do back last EBITDA significantly how add I not one is back take add exactly -- get And different? do or the helpful. in It something they Eric so suppose.

Eric Gerratt

to Some in how for a four rolling in the rolls so of EBITDA some into of the or calculation, terms trailing differences prior the in that and of quarters NRC it EBITDA calculation acquisition that it's quarter the is are that cost EBITDA as some out calculation calculation that some savings where NRC in are include also savings into we synergies are there include calculation. calculation cost things but that forward-looking in able as as calculated, well projected to synergies

Tyler Brown

Okay.

So very pro forma.

Eric Gerratt

Correct.

Tyler Brown

That some All That's explain right. Okay. helpful. of helps that. very

thank guys, Okay you.

Operator

concludes any call question-and-answer Ladies for gentlemen, Jeff this session. I'll turn remarks. to back and additional our over the

Jeff Feeler

during times just wishing and all to participated challenging of results and that like by looking year. QX you to taking given towards well you those I'd this on forward conclude Thank much. these update Well an our so August

Operator

for your gentlemen, With that, presentation. attending this concludes ladies Thank you conference. and today's

You disconnect. may now

US Ecology (ECOL) 9 May 202020 Q1 Earnings call transcript