Earnings call transcript Q1 2023

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Operator

Good day, ladies and gentlemen, and welcome to Clean Harbors First Quarter 2023 Earnings Call. All lines have been placed in the listen-only mode and the floor will be open for the questions and comments following the presentation. [Operator Instructions]

At this time, it is my pleasure to turn the floor over to your host, Michael McDonald, General Counsel for Clean Harbors. Sir, the floor is all yours.

Michael McDonald

good and Karen, you, morning, everyone. Thank Investor on Eric Gerstenberg me Chief Officer, SVP today's our call Officers, Executive Financial of and Dugas; Co-Chief our Eric Jim and and Buckley. are EVP With Relations, Mike and Battles; posted today's Relations along. website, our for invite Slides on to we you Investor are call follow and

release place statements Reform discussing of to potential the on results meaning to revision statements are filings. not reliance Act Information results Company reporting of we is made cautioned the XXXX. undue that in that Matters the than are historical facts X, statements, through today factors management's this And publicly could concerning The Securities Litigation these affect within are to our today filings the and are risks of Participants of XXXX. period. considered obligation made which forward-looking only opinions undertakes any on SEC Private today, our not reflect no other May as included or revise

discussion historical news measures website Clean of provides directly and in to GAAP references most measurement believes in performance. available presentation. additional today's an that our such consistent information the Today's non-GAAP of of Harbors these to comparable Reconciliations release, measures appendix its on are today's comparison measures. and includes the

the Let Eric? start, me call turn over to to Eric Gerstenberg

Eric Gerstenberg

for us. thank joining Thanks, you Michael. and morning, Good everyone,

resilience of Environmental business results the our growth diversified demonstrates and execution our quarter first the We our Our growth delivered of model. segment. Services across broad-based strategy

all of favorable employees. in capitalizing cross-selling over the assets service those by branches, our and our unique In were our market results conditions, sharing XX,XXX addition platform, driven XXX on to

got quarter goal into The let a TRIR outstanding ambitious safety first of dive in which a our XXXX, of team highlight me best below X.XX. we well our first off numbers, start terrific to X.XX, is performance. delivering the us Before

increase the challenge surfaces, frequency The a slips, trips and given falls. perspective, a safety which of the first quarter potential can icy from always for be

up hats work. So yourself keeping Keep the great team colleagues safe. the to off on and your

Turning with solid achieved year, to increase $X.XX again by drive segment, on XX% profitable and financial billion. we Overall, a continue X. in and top Slide our we the bit Services talk our to for which margins, line was our cost equipment. a which had Environmental EBITDA those from a of Eric maximizing will line QX utilization through to inflation growth. led rose a our Dugas offset more price people the quarter. about results generated That by our initiatives our guidance ago We but adjusted year the helped strong start as to XX%, while

this Our considerable we leverage as continue quarter results demonstrate model in our grow. the inherent to business

network, the continue Day challenges in some the by in Services drivers We the Despite in segment. remains great we supported March. weather-related at detailed growth strong, to Environmental see momentum demand our Investor

segment to experienced health we talk our costs slow a than more year-over-year which oil SKSS, as pricing oil care and management in the a gotten That difficult profitability, start. the more Within business lower Mike macro moment due to a market base will in experienced off about has Meanwhile, to year, inflation. base in start decline better resulting was efforts margin a Corporate compression. offset the cost short-term as down environment

ago. with to up revenues We even are this down efforts from proud of our number year XX% bring a

business Environmental units our growth in a to within segment by was The the with four each growth X. driven and of volume on XX% Slide Services. in of Services revenue Turning Environmental combination pricing

such Safety-Kleen in and of unified Environmental revenue see HPC offerings under ago. parts up Field core the U.S. Services across Revenues impressive increased as throughout initiatives. the see we the brand our XX% cross-selling a quarter, At to from services, led considerable year continue We time, move acquisition as $XXX,XXX XXXX late the by which was of board up a for same grew to wash branch the services. growth our its the Industrial in in demand X% on X% revenue Services to XX%, benefits strength grew and continue an pricing, forward the

Technical Services of XX% increased weather-related up revenue some at despite unplanned level of from challenges. facilities primarily an our disposal was outages caused

lower versus in As the at a XX% this at quarter a utilization we expected, result, year our than XX% incinerators quarter in coming ago. was

QX into back the a expect utilization tough that We in of couple after mid-XXs to move here quarters.

as of QX, today, was in up in of all strategy due incinerators pricing streams while rising up the offsetting well. incineration focus a at we higher to costs. here value Landfill fact, sit flooding competitive to X% Buttonwillow, and volume In ago waste success severe California. site year our demonstrating Average year-over-year remain XX% was our from are on running our price

volumes base business, up landfill reflecting in projects. site, year-over-year. Landfill was in strength waste the are of mix a with that along ton Excluding healthy the quarter, XX% price per higher

as growth profitability, Looking at XX% our segment services again leverage and EBITDA business our top our for to of increasing continue line, demand model the outpaced illustrating strong. by adjusted be

also productivity reduction programs and of a benefiting [in] from cost in quarters. efforts are We recent number

margins As result these we XXX basis from achieved point a factors, year a increase a ES of in ago.

our SKSS now take allocation and strategy. you will Battles Mike? Mike capital through

Mike Battles

everyone. morning, good and Eric, Thanks,

in delivering by our team work customers. for me begin our acknowledging Let of the great

[and] ES the environment As is noted, robust. Eric demand

helping skill Our our that customers technology resources drive productivity. people the an that of and increase because through are integral to use playing set of and their and enable tools valuable demand their role efficiency to in

Moving to Slide X.

The our pickup pricing had anticipated. quarter, than seasonal we March first had in Our in falling SKSS slower of segment expectations. a a short segment experienced profitability challenging

for sector by move as has the pricing remained QX, recent the decreases April. As base we into price across weak early noted oil environment the in

to The slow to sidelines we lower been have the higher spread. line, from revenue acquisition as driven off last pricing, near-term services. margins. base top in X% small resulting ancillary revenue SKSS adjusted variance decreased EBITDA the On sales June volumes seasonal re-refining higher compressed well weaker-than-normal to oil SKSS due the driving start XX%, Buyers season. grew completed by our come and as of the annual was by which

Consequently, we the in six margin the with first year of in leading half we when XXXX. increases the last expansion saw months, a experienced of the comparison significant first faced first five to difficult price half

from primary XX Our on a a months. help year at the quarter us focus in cost ago. our expect in we the for UMO, oil for the over recently lowering of pay gallons, rapidly response has to pricing been Waste began to We manage decision to market, pricing. coming the course were up the the in we quarter collections which market in collection strong response XX% million oil

accounted our of plants. product total Blended sales XX% for output from

X% which Our direct increase our blended or volumes are closed-loop volumes, -- volumes. start nearly which are half blended a approach, all of year. in QX, remains slow we're this implementing at Despite our our to we goal

wholesale blended, both, expect and we made. deeper direct our as to sales move given we XXXX We into improve investments the have

Slide to strategy. and capital our allocation Turning X

we On see for both transactions, to of the front, a potential flow good operating particularly continue M&A segments. bolt-on deals

Southeast Industrial are broadens mining great Whether day power. mentioned, It or start Services We're for and on off companies Service transaction with we that in to our sold to an Environmental impressed but and a including Services, This and continue synergistic Thompson will paper, we not other team. Services afford us to the Industrial opportunities target are Businesses, the verticals cross-sell. last $XXX position our all-cash of approximately completed services. in in As also QX expands U.S. have the million. where the Industrial presence deal Thompson acquisition Industrial we for Eric

key Dugas takeaway Eric sheet a our his will from remain touch flexible, that perspective, is we're maintaining us But to on sheet strong will remarks. balance debt M&A. balance with the that in opportunistic a enable

budget We've on state-of-the-art to previous incinerator That calls open internal continue for business organic annual and on to in Kimball, XXXX. schedule capacity XX,XXX drive remains investment tons We in about new talked to plan, early growth. on of Nebraska. evaluate opportunity our on

Given certainly market sooner. conditions, it wish we were

Overall, well strong facilities. of of trajectory. are and challenges exited how seasonally side shape the with great stronger our businesses oil Each into we the despite we quarters. quarter our started we are pleased XXXX base we move on a some on as have ES, Within our in with

in to speaks slowdowns the Underlying what we favorable, also to we While yet remain environment segment. which questions market provide any have of conditions nature remain, about the essential macroeconomic ES our to see customers. our

rest Our us the well record of backlog year. for the waste of positions

QX Our our the diverse reflects nature business of performance also model.

our Within to focus costs short-term approach is control. SKSS, That we Therefore, continuing the of is That stabilize expect with the the controlling season. to on market we challenge. this pricing means across a business. can what control pressures driving summer said,

we to oil ensuring while feed aggressively we re-refineries. waste managing costs, Specifically, our collection have supply enough are our

adjust nimbly for market position our we three organization, currently today, PPS or on Services, we ago, and to Based Products a which here oil collection bulk allowed conditions, years us more charge established collections. net we at current costs. as sit are with Our our

Clearly, current SKSS. This slowdown ES environment segment, to this believe pricing gave Eric anticipated are will XXXX than segment why is more will be share shortly. we guidance. when expectations the is for challenging initial our we We lowering which our XXXX offset in the we able Dugas our

profitability as We drive accelerating million production or include compared more, These to much continue areas. a We XX solutions spread year friendly minimize base remain new SKSS plan, Day. KLEEN+ as to to through greater ago to interest several introduced the of are with cultivating segment the oil Investor long-term at oil in and going gallons compression through we this committed of sales as base brand. environmentally growth our Vision XXXX part blended our

Eric With that, CFO, Dugas. turn to let our over me

Eric Dugas

everyone. good Thank morning, and you, Mike,

period equate point from Adjusted XXX early gross increase leverage to of a year history. Services increase, in Turning March revenue with single by quarter a XX% year, EBITDA our $X.XX represented eighth the to to improvements, $XXX.X for and organic and in a of with generating with our a provided vast percentage fueled results margin million, Company's SG&A QX These growth margin fixed Revenue we strong total the XX% lower guidance line majority X. a organic reflecting the over of in revenue our on revenue. segment. in billion, ago monthly double-digit same the largest Slide of March. of nearly the consolidated million cost the $XXX was increased last Environmental income statement that consecutive basis quarter increase XX.X%, QX as growth,

leveraging XX.X% improved gains strong as points appropriate expense growth in our XX to and of for improvement SG&A reflects improved from This also a our reflects percentage holding increasing costs the stakeholders. with offset our to productivity margin and basis operational price QX. increases to ability our to revenue on while line to That XX.X%. value drive commitment improvement Gross inflation efficiencies. realizing

XXXX. to as to revenue we year range, flat continue XXXX, of SG&A remain XX% For in expect full low to costs a the essentially percentage

Depreciation QX in and million, expectations. with to $XX.X increased our amortization slightly consistent

currently from addition due million XXXX, Thompson amortization XX% depreciation the a For and of in to slight increase range from operations of prior Industrial. we Income the anticipate $XXX million, $XXX to QX to in increased nearly by income for $XXX guidance the a strong continued resulting our margin $X.XX improvement the driven ago, XX% million, quarter growth Environmental Net EPS million, per year up share. combined from in segment. of in $XX.X revenue Services GAAP with our was

debt sheet QX and the Slide fact at due with and typically of and balance payout highlights reflecting tax end that the short-term billion. bonuses from the marketable well our quarter interest over to a period Turning down payments. million, securities $X.X as Thompson year-end use as were Cash X. large transaction to year-end, of just We is $XXX.X the ended timing cash on quarter the of

discussed remaining call Loan B Term January, of in we $XXX million due we that then XXXX. the last was in our earnings on As our refinanced

senior million. our $XXX of unsecured issuing eight-year by for million and tapping by this Revolver in achieved $XXX notes new XXXX We due ABL

for at comfortable years. are to approximately lessened approximately average of basis of continue as debt reasonable total no debt our Xx. of being And on current with debt of was due as amounts have weighted the net our we a X%. exposure And We today higher our about XX a cost coming to our rates, at debt-to-EBITDA March XX% rate remains feel portfolio overall Leverage fixed with significant number there environment.

In reflecting QX, Nebraska ongoing year-over-year incinerator $XX slightly Turning cash cash was flow quarter, $XX.X project, in quarter. to expectations CapEx and million, our million a spend where higher which operations better year-over-year spend slightly free cash provided our from QX on was year $XX the was year Cash was than a ago. primarily improvement. of $XX in negative million and this of $XX on roughly represented flows a adjusted internal disposals million a net use from up Slide substantial of million was prior XX. versus

in to net we be range continue million. XXXX, our $XXX For to of to $XXX million the expect CapEx

$XX year up expected Our CapEx timeframe. total to still is the Kimball investment approximately ramps of as summer this spending in the million

equipment also are growth business minimize invest continuing the transportation third-party our in and to the spend. of to rental We fleet and accommodate

During bought total a more at of stock $X we shares QX, million. back than cost XX,XXX of

over allocation just integral million strategy. existing under which buyback capital remains $XXX have We program our an our part of authorized remaining

Moving billion market conditions our to results, and QX current the for expect addition adjusted we now to our Slide XX. range of on Thompson segments Based EBITDA operating Industrial, of billion. $X.XX $X.XX both the XXXX in

X% to guidance our expect we at a X% from a to of year-over-year for approximately perspective, than XXXX QX challenging comp Looking EBITDA segment. be our due to quarterly adjusted SKSS lower QX

Demand reporting XXXX EBITDA In full adjusted to increase at very includes is translate EBITDA attributable a and to which revised our XX% our how guidance XXXX. $XX guidance Services, favorable EBITDA the million segment expect Environmental for into of of adjusted approximately now disposal ES year facilities to acquisition. we in breakdown to our services XX% to a price. provide the segments. from strong, full continues The now now year translates our Thompson and I'll be adjusted midpoint that average should mix

we base demand full now EBITDA guidance XXXX oil reflecting range in to SKSS, high our pricing current decrease the at year midpoint For adjusted of the trends. from XX% anticipate XXXX, and

XXXX. cost adjusted compensation. be This adjusted of mid-single attributable Segment wage bonus the In EBITDA lower we expenses, inflation by for now offset Thompson. of year midpoint insurance and to negative Segment, partly million overall guide, EBITDA Corporate reflects the Corporate full savings to rising approximately expect our increase at $X digits our negative and guide up The includes

We $XXX in cash free million. continue to million to of the $XXX expect range XXXX flow adjusted

approximately million better-than-expected a spend remind $XX want of that the had in our we everyone includes new incinerator While for I to QX, guidance XXXX.

the cash range spend you million. back, midpoint of about free would If our adjusted $XXX that added be flow guidance

marked QX summary, for In our a start year segment. Services the to promising Environmental

disposal further our strong, many of volumes continuing industry. people for utilization waste demand robust the highlighted, are of which backlog Healthy supported Gerstenberg remains across and our Eric of created by facility As very high a has service across businesses. being equipment

that to Day remain With of exception that the dynamics at record XXXX our we recent favorable oil outlined the base trends a business, our led market and Investor and underlying intact.

ever. our segment in year Our as growth this prospects as are Environmental strong Services

expect We our Clean in manage slowdown we for way in Overall, previous that through initiatives SKSS in as Mike will done mentioned the Harbors year solid have we cycles with here XXXX. the another earlier.

And with for up open the could you questions? call Karen, that, please

Operator

our from from Instructions] [Operator question Stifel. take And we'll Hoffman Michael first

Michael Hoffman

quarter? demand that far revenue, utilization strongest pure Deferred the it tell, ever. Is in is just strongest quarter. how as Nice I as much of -- versus can the the issue

Eric Gerstenberg

Yes, Michael, this is Eric Gerstenberg responding.

to So the the predominantly increase due really is deferred low incinerators. on the in utilization

Michael Hoffman

environment demand of And underlying the more have versus still would up been so or flat? because XQ it likely

Eric Gerstenberg

flat. likely More

Michael Hoffman

right. All

been the $X your So hit well, utilization, numbers revenue. profitability on of your level you of Thompson, have would given as then raising had if ex you million

Eric Gerstenberg

That's right. right, Michael. That's

Michael Hoffman

reaffirmed part to my is that's and But it going Thomson, point guidance of going ex to a is raise you're anyway. be

Sorry, Mike?

Mike Battles

That's right, is Michael. Battles. right. Mike That's This

So it -- It have we you been better. got was right. would really

even said we have was to Some resulted those ES. plant lower with much utilization, disruptions us which actually a XX in what little a But it ago, to prior lower caused problems. days higher

Michael Hoffman

oil and into the were then above balance the guidance the market and Right. that in imbalance on because with you knew we we appreciate reflect one that. 'XX of the is to the us is expected your at shared average global coming is supply-demand to back help trying And of year, things of beginning the base

underlying sort without million mid-XXX that in that anything utilization of $XXX around we're So then more feel better still being and and upside. of is still the baseline you guide have at in short-term did you'd a sort been a sort that capacity absolutely seasonality? around somewhere lives -- precise towards of would you imbalance Do And a baseline. lending

Mike Battles

Yes, believe firmly that. Michael, I

with that we come summer materialize. think would that driving just the didn't up is pricing assumed and season, it have you challenge I the

down. matter of fact, it As a went

mind the as our in I And there. so my UMO said our but call, lag pricing that -- aggressively, collection in we a there's we costs, -- adjusted and

it its is through have And problems, a And of from lowered we XX any see let's thoughtful so we that effort we QX. you where make to in the ripping lag sure ago. way kind statements financial bit don't and it further in here an quite say, days be were, and

Michael Hoffman

XXXX, strongly upside approaching and but to XXXX you $XXX -- the this IMO $XXX low you in way in million base But whatever Okay. of ex did to the very say still global 'XX? demand puts the in is million something from oil supply feel that was another that

Mike Battles

a Yes, come us] XXX it's back Vision sir. mean the end our straight years, and I shared a not [tell line. the month up XXXX five by of we to ago, would

work through kind job we're position, kind that. $X.XX started low I say, charge So good decline on continue call. the quarter to to the team of for UMO done which to prices of And the a going has as from, drop, oil pricing said this let's

Michael Hoffman

And charge for low now? on that of digit you're single in oil the sort

Mike Battles

are think digit. low we single very, I very

Eric Gerstenberg

organization and down respond drive conditions to Yes, reiterates I how quickly have costs. been strength be our the Michael, UMO to it market think to effective of our BPS to able collection they

Michael Hoffman

has think Industrial have all Industrial showed far and tracking one for any really activity, an the last strengths so But who industrial production And of pieces me. to stronger? more good across broader, are today then I production relative were trend? correlating others markets been your balanced And as business Harbors end you about [indices] Services And how reported down. that's of Okay. as but weaker, of market you little this there Clean portfolio. a the were have do that one

Eric Gerstenberg

Michael. Yes,

very So The continued of the we we continued need business year. strong and investor look units I -- presentation. would growth balanced in as all obviously said say in that throughout services we as our Environmental Services four their strong experienced are the of in

we We the any haven't verticals serve. really across that not seen have seen slowdown we --

Mike Battles

they in that year. pretty and the to change owned -- as so -- kind of good we kind quarter was a Production us of of tough of one quarter QX Services, had first for quarter did full Michael, Industrial we lot particular, prior comp management. first was Industrial And hydrochem a a

also I that had -- so And would is and say that doing terrific. is decide helped think we I HPC

think in that comp did to I is a turn going acquisition a We QX last to year. have out home versus QX be good pretty run.

Operator

And Revich next, to we'll Jerry Sachs. go Goldman from

Jerry Revich

a look if the I mix? little how hazardous through churn to based across bit ES, could just about How does the expect strong what you and waste incinerators from really landfills. pricing business of wonder you the XQ? that that on of then course much here talk is more And over

Eric Gerstenberg

Yes, driven favorable quantities [drum] The ES, well direct segments higher-priced across be across all drive will board. the we've to say as improvement -- and to as continue we've noted. burn businesses volume And those incineration manage our as and our to we'll Jerry. in that. pricing of the we do focusing seen strategy up across is mix to continued on and continue that continue the to we've network our It's by network, through

Jerry Revich

you the so wondering up as we Analyst out And expansion to Can there, outlook, quarter. that laid the what the opportunity EBITDA out you know course expand laid at talk margin cadence if given folks you I expect just set 'XX? the just just about the conversation growth could margins pick of Day? maybe of for nice you I'm margin in but the continued that over to expansion you

Mike Battles

Battles. is this answer Jerry, Yes, that. I'll Mike

QX. So I such faster in or expansion QX, think level than margin QX, was quarter us such expansion, would we the margin landed where is a same strong and given say, little even for the year. QX modest QX how a at last I

I'm really about the So again, business. ES bullish

in more year. be that the there's of great had a to going half to I think the and drive think ability of I kind it back margin start, expansion

Jerry Revich

can like to it and that's the to talk you see tracking about how just And expect I you result? Super. your started lastly, topic, additives evolve mix ask? supply. where as On sounds we a better Can

Eric Gerstenberg

additive our growth get Jerry. blended to Yes, issue strategy. The supply subsided. We're additives able continue grow has to to

Mike Battles

I did consolidated ES know hope Jerry, the want the your the was margins? I margins, was your asked earlier, you margins ES you the not in question answering margins. to question. that or consolidated

Jerry Revich

my mind ES. usual, you as Mike, read well, the

Operator

go next, to And Needham. Jim from we'll Ricchiuti

Jim Ricchiuti

of you in in if the wondering California on quarter. of can the just the impact size flooding the disruption business I'm

Mike Battles

Yes, sure.

just So in early where we it was outages we think to plant in $X in million the California, the unplanned million, business. in general, ES not $XX the of but business, in disruptions ES flooding had kind the some quarter

Jim, So it, well, I $XX I bad I million drove that add to that. that was think the better. want results even to you when you million you think $X on take But that though, you, our weather -- and that's caution think say, about and

weather And bad sometimes thing may Because helps -- Field right? good be for it true. a our with us business. Service But that in us, is

of board weather, manhole was had the work advantage a due least be the fact up And As part takes quarter. that at there, Service to clean kind Field of A way some space. to of in the said, we're -- that Eric lot quarter up bad I lot there of a great and think utility Field across Service was of. this done

it's XX% the trying the are down. So weather low utilization on -- to dangerous is because landfill always and we're challenges to explain plants, volumes

-- it's wouldn't use to $XX the just sure -- try add understands it call our good. that happened I and we street and million of results, very kind temporary. make that so what why was take And But

Jim Ricchiuti

fair enough. That's Yes.

were response any saw So saw ES QX? in Field work emergency you that there unusual you in apart in from the -- Services, what

Eric Gerstenberg

projects large really there Jim, continued No, We call demand, wasn't. to saw out. board really the no across

Mike Battles

lot of ones, a small really. It's

Jim Ricchiuti

look while now ES second the tailwind I'm price the and for a current have to last quarter And the taken -- what several to then because pricing of you've and the is And the been Got side -- the in talked you've there course over a quarters. as about you wondering, extent that pricing the business. in half, initiatives out few of it. a

Mike Battles

Jim. Yes,

pricing. XX% So the [and] is I when it's that quarter about done a from price job the in Eric growth mid a about say at I ES we've you get prior didn't really pricing the it, had comp We really mix of think pricing last good think And if year. QX, year. We of you into QX, decent increases from think volume. until, I'd let's as said, say, recall and

ES really, had kind we on relatively the side. of pricing to So against a on work decent comp the

continue business. we to to SK that it We've across the branch kind network be think the PSI, said, price been price of board, all, on whether and across I That FS, able drive drive continues.

they be Our costs remain up, question, it facility our our answer I'm people or maintenance still anyways. to ask going really costs costs high. Whether are and or but costs, way the you didn't our

And take so are be our very And business. of continue that that, to want our listening need to to and aggressive also price drive to out really I customers driving is in drive especially out -- cost costs. who to may network we stress [growth] the to

down You year-over-year. costs, see they're it corporate our in

those structure cost keep really our business that's and that our yet ability kind very to company [forward] jurisdictions due well, corporate seen of and I to move That's costs drive headcount low to haven't manage a lower-cost costs our customers. really try year-over-year. service while we down to had

Operator

we'll [Operator Tobey Instructions] from our Truist. question And take Sommer next from

Tobey Sommer

trends couple industry as experience the the Clean the Harbors do of how you whole extent think a With wanted to see pricing questions. ask I can industry pricing level, to that? ES at a at to pricing you the and respect into compare to in

Mike Battles

talking of to industry We on can Tough has we kind the say, versus exactly. do done. about what what focus Tobey,

-- Harbors -- hard welcome. about speak first for not wouldn't want -- just I'm I -- Tobey, price, we the I don't comp, had so really easy all, Clean of of on structure So had to to I coverage. much. The as because certainly, comp. we've and our your to easy decent comp, can't because speculate up call. aggressive and gone Thank we've it's sure costs to pretty Welcome you that. And But trends. said, industry me, I a our as but for not been cost have a to,

Tobey Sommer

you appreciate those being And about that or discipline there price incinerators, businesses customers strong there And answer. certainly pricing pressure? price, and any where there pockets another what's your more talked that increases? I Are is handling resistance question for maintaining very on customers of to where process is

Eric Gerstenberg

is I'll this answer Tobey, one. Eric. Yes, that

The has is. been areas there the price. push toughest Business So one Industrial traditionally been of the that to has

our we've to customers, that. those the we labor very that is However, to some that been ourselves and need there the aggressive right across people the been customers align of we to so day, them, walk away aligned from, those with utilize to customers end can our assets on that doing At and in in we've in speak, with. in want our aggressive push always We've so we position increase and customers. with based our increase costs trying and

So we customers. value and board though, the we relationships our push board, across with hard across our the

Tobey Sommer

both employee what's hires? your we've gears, many shifting coverage, new then acceptance respect in experience year-to-date been And those our improvement marked a retention trends with at heard of Across to dimensions rate pretty for and for firms.

same if curious thing. you're the we're experiencing So

Eric Dugas

Eric Tobey, I'll that Dugas one. Yes, here. address

with think employees, front first improving. retention really is the we're on the seeing here I turnover quarter what in

wages -- of bit is look us helping prepandemic to our us moderate we to inflation. stats, see think was what helping backdrop it rate that's the certainly back the going closer against if our cost in turnover I So play, at really, down see XXXX. a that's little And

helpful. that's So

of On the internalization hiring which, again, XX helping us last more transportation particularly drivers as over certainly is headways, months there made with drivers having that drives and well. the front, cost internal great

our So been strategic team the of us labor positions some we're quite And the able that's last with drive on our has hiring. direct revenues. kind being really side HR to close over busy several quarters helping

Eric Gerstenberg

Tobey, Yes, our off as board have presentation, up put Day drive across on lot board across Investor headcount. employee to additional paid a said of the the lower really emphasis as our our Those show dividends numbers we turnover, well. our as in programs we've net in

Operator

next Oppenheimer. Kaye Noah from our question And comes from

Noah Kaye

of to the talk M&A past. you've the some wanted in done I about

HPC winner. being a talked You about

Sometimes as it's years capture lap side only year. closed full cost a tends on side, really and from literally the revenue focus But dissipate that. been first you synergies to X.X since that both, you

to great cost get out So and both, in it to on and is, broadly. have additional get in the ES And more that appetite just then be HPC, M&A and a have within would fold shaken just Services update ultimately Industrial second opportunities revenue an wanted from you your Thompson synergies part perspective? the on now where

Mike Battles

the one, the and I'll G. I'll Well, answer answer part. let Eric second first

of areas. So lot it, you Noah, see in a different

So cost of first million the HPC $XX of savings all, we signed acquisition. up within to

and from Industrial getting it clearly, that who's a and didn't HBC an up Or the to I person business I synergies gave who hard Field service a lot I've guidance think But really more got employee? for work real the -- because Service we identify think we've sale? even lot when on before, our any sign because a the it's out is customer more we more Tech and calling picked sale? the are talked businesses. get cross-sell that field in -- of revenue we Did Services opportunity SK

that pinpoint But why guide We there's to exactly numbers. that I don't to how there. that. think Hard of we plenty of upside happening. is kind And certainly put don't much. it So that's do

to nor bringing a is legacy didn't we talked lot really business team customers profitable have Canadian to did other that Canada, business, on technology The much we services busy and that U.S. bringing both of really that of lot much our the it, been automation didn't through and automation, of Canada. in a our which customers, in legacy type hydrochem have And about, which the to the our industrial seeing that thing we're progress and do our very in safer more trying is of more it.

getting winner are the a and of as think to it's over we last of few And end, again, applied an to thing of win now. of -- as Investor and thoughtfulness I'd really to I and weeks took is month, I Eric early for And high on lot The will pleased maybe of talked a know their really doing good we -- say that think it of kind a up teens so both been and we when good to mid-teens few some returns low the about a that I think I I next be with kind it and been one kind Thompson, margins and and ultimately well. the that out turn Day. are bought learnings only a that's years the we've their processes. only been But kind been that's

M&A? want you to talk Eric, kind if about of

Eric Gerstenberg

and sell to customer Yes. as with add in No, continues to the the to seeing network our opportunities, just there one businesses, businesses be that other IS one team M&A and Services, same Day Industrial board have to just ability Environmental look in join team to what but they've been at Industrial. that was When the from. TS on the Mike Thompson excited comment said the FS pipeline strong, opportunities Thompson not we're over driving disposal well. we in across revenue operations in the only sales base

it as sign robustness show into of get more continues signs -- here. we XXXX to So

Noah Kaye

A question SKSS. on

you course you the blended mix of the in the I think improving expand might you this the over what's you can color happening blended identified the give year? over in any year? I'm substantive course mix interested maintaining the as how to sort this mix what controllable of of for segment quarter? in levers there. Can impacted expect on profitability of the really of one of on trend segment And

Mike Battles

Yes.

So of a gallons. start blended bit QX, done not than a the gallons good blended job expected. team we down I think do great has little a But and what driving

a going straight I line. We'll it's that, not do think year's better we're to beat number. last but than

that not a more XX% more of a of the settles far. be was this, on I there's the bit dust put blended results, going kind disappointment. in year-over-year to certainly so QX so right? QX We on a So pressure when little think And

Operator

David from question next our from Manthey Baird. take We'll

David Manthey

about here, groups, apologize key quarter between levels if mix the turnarounds price been customer comments you you've so already. jumping incinerator I complex But answered on among XXXX? could general particularly this talk the the activity and just Sorry, I've during chemical calls for any and

Eric Gerstenberg

alluded we're Eric. is improvement. earlier, XX% really this price, -- David, to Mike Yes, about seeing really XX mix volume XX% and

the to our the strong that continue across we that throughout and across volumes, outlooks strong that network continue strong board. driving are and direct be that's So burns, chemical see vertical,

David Manthey

conceptual Okay. a this And question. then is

helpful. throws I'm adjusted any more to have would that? market you regardless revenues. background you what why there of is feel us? be guide EBITDA You EBITDA, the just over Do control not wondering at Just

Mike Battles

side Yes, guide around, you an the when oil we us rapidly. in we're because can price taker, on the don't to reason a So it's oil David. of very on pretty The know, right? guide hard is, why for move business, that as number revenue

managing focus oil price on The spread we and sell motor during the So collection. for we a pay price we kind of tend of to kind oil. base between or on the charge

to so on number really, the try to we And side. EBITDA that's stick that

so XX% guidance that's of business, give because not to we revenue And because tend that. the of

Operator

closing like there be Instructions] time. at this to over I'd turn Gerstenberg [Operator further to no appear for call questions to Mr. remarks. the And

Eric Gerstenberg

June. at Thanks, Sachs handful Jim Eric, joining in week a be more next Mike, everyone, for conferences early today. and I us will and Oppenheimer participating Goldman the and

seeing at to look you events. forward We some those of

Operator

conclude participation. Thank today's does your and thank gentlemen, Ladies for you. We teleconference. Excellent. this you

lines may your disconnect time at You and great this a have day.

Clean Harbors (CLH) 3 May 232023 Q1 Earnings call transcript