CLH - Earnings call transcript Q2 2024

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Operator

Good day, ladies and gentlemen, and welcome to the Clean Harbors Second Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to turn the floor over to your host, Michael McDonald, General Counsel for Clean Harbors. Sir, the floor is yours.

Michael McDonald

Thank you, Latanya, and good morning, everyone. of call Battles; Co-Chief Chief and Eric and today's Gerstenberg Officers, Financial on Buckly. Dugas; Mike Jim and our SVP me are Executive our Eric Officer, With Relations, Investor EVP and Slides for our website, we and along. posted you follow Investor to Relations invite call today's are on are are Private Act Reform Securities that facts considered not we Matters today forward-looking are Litigation of historical discussing statements the XXXX. within

made of our place to management's are reliance July of measures to filings these our such statements, believes Harbors no Information includes not publicly revise available consistent historical website its reporting measures. statements reflect presentation. measures potential SEC that release, GAAP period. the of as comparison included today obligation Participants additional and and which in this and today's most that opinions only non-GAAP to are revision or undertakes the made our today's concerning appendix release on on measurement on these Today's undue news today, The XXXX. of references to Reconciliations results XX, risks cautioned results through the company the discussion in other directly Clean any to comparable filings. factors information in an could is provides affect of than performance.

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

Eric Gerstenberg

this with both to of these for Beryl were is our at recordable Because is of prepared time. all safety which critical safe. Gulf well for regions The of kind on California wildfires year us. Hurricane total consistent where of values our on which and as year-to-date Alberta thank situation. employees is be joining crises highlighting by core I Thankfully, are recent at Clean a in it Harbors, the is Thanks, a how you impact the any Michael. will and we X.XX, rate, ago of morning, Good a foundation our reminder start employees some as in is incident everyone, basis our the by

Environmental QX businesses, that of X. our waste points for attributable in were of momentum. part HEPACO, XX margin with especially acquired guidance, benefited on ES year-over-year. and results results to several Slide our volumes pricing and to basis March. record demand and Revenue in continues full driven EBITDA highest first to sustained history delivered EBITDA We adjusted service exceptional from This containerized in improving Services. Services facilities adjusted we outperform. are Field robust network the performance our our its a Turning surpassed by business which quarter

Our lubricant of SKSS compensation due to segment Corporate posted of and environmental related handful a by season start and Fueled incremental substantial acquisitions liability matters. QX. pricing. and driving summer greater improved in higher the sequential were expenses a to increase discrete from costs legal from incentive quarter headcount the the

Turning enjoyed turning remainder an increase to drove XX% profit even increased in XX than gains Slide increased consecutive for of translating Adjusted year-over-year XXX half more the revenue another fantastic quarter by comes growth. with HEPACO X. organic Environmental for Services into XX% from the of accounted segment's larger points Environmental volume to to increase of basis This now growth expansion. quarters. has adjusted and line EBITDA pricing. Services segment attributed top EBITDA revenue margin

volumes is which balance again with of key revenue drum a through Technical performance network the reflected collected Our in increase continued deferred revenue to segment's levels was of sheet. Services a record business the on We increase in contributor our XX%.

expect in will full to the we Deer range early in major at a our Average XX% mid- continue the and pricing deliver turnaround our the incinerators incineration in the XX%. our completing to Even for Park achieved utilization with X% high incinerators quarter, facility of year. rose quarter, utilization

state-of-the-art new the supported incinerator nicely. We team we also and our is construction also plant remain schedule done price Nebraska Landfills that outstanding coming in to in by base and volume average with volumes a healthy keeping on as QX. saw has up had and project drum job The Kimball, performance work. QX on in both together an track open strong business

We continue to XXXX a deliver very broad a to good expect mix opportunities. streams and and of waste landfills with project

XX%. the generated increase Services in largest Field the of quarter

service While been low posted legacy The a this has was great business existing primarily driven fit acquisition our percentage by field growth. HEPACO, operations. teens with our

in to During revenue several events These work by the $XX total side million for larger events roughly emergency responded where side. both accounted response quarter, large QX. we of teams in

to services expect national response call collaborate fully HEPACO's on operations and center as perform integrate emergency we well events. We to continue field and internalize major

compared multiyear extended its as waste, turnaround In Services of to IS We activity to Services containerized offerings, core high this another Environmental for QX, demand. XX% its our in just at with great XX% Industrial segment. Overall, declined year. remain to last momentum a we revenue see return anticipate growth revenue growth Safety-Kleen due turnaround reduced ES revenue strong fall, expect to particularly a QX. schedule quarter and

turn over Mike? let me Mike. that, to things With

Michael Battles

Thanks, Eric, and good morning.

rebounded by million achieving million Turning nearly more $XX up a adjusted in to challenging Slide than $XX QX sequentially. X. EBITDA, from SKSS

a X% drove from base Noble volumes the with Our lubricant increase ago, ran in smoothly the sold Oil, revenue. along resulting plants increase oil in in X% quarter, year which, of a an acquisition in and

Although the opened resulted volumes spot in noncontracted those segment with weaker demand posted to for led small base market Overall increases, a announced changes. price year-over-year in never the and market a incorporated quarter several decline fully profitability. oil

the at our up achieved to from products. prior collection volumes cost QX, ago. year year, pay Average a in our waste XX% up in in a we to our X% Noble, small was continuing our [indiscernible] blended With collections the charge need at a intensify gallons is from our feedstock sold. per on minimize refineries new of the the SKSS quarter. for best of oil value-added XX level representing addition slight We're price. X for were the to Noble, record level averaged at collections the you exclude total a oil. of procure focus Part gallons strategy volatility million QX When oil legacy

Our our QX. Group We of re-refineries the of and fee well group in production III part is ran to full-time stabilization strategy. also dedicated initiative it one

encouraged to We Group produce about ability more are III. our

We will be another quarters running a in program at the to ahead. expand this pilot re-refinery

Last quarter, dozen with late media have show. industry multiyear since Castrol with its efforts transportation been circular [indiscernible] and in the They we employing key key and program Castrol considerable officially discussed trade was X at our launched a partnership announced program. May marketing program the more publications.

have we interest of that fleet about a they specifics many pipeline we progress, been While building can can't confirm share sales across large their operators.

oil. the Our a our cash base a Castrol by is as this been partner potential oil Purchases multiyear has flow of agreement strong, validation of long-term we're partnership. rerefined sustainability base excited and the high-quality with about strong

program expect from gains to sales this we immediate don't long we significant cycle, about While impact. optimistic due remain its future its

Slide Turning to capital X. on allocation

flow the Given current our low our leverage. and balance strong half, cash cash second in expectations

elements as acquisitions in today Halfway our allocation and making the considerable such grow we extract Kimball HEPACO are smart XXXX, where value and capital core We through of the outlined plan we excellent incinerator business to demonstrated Baltimore as Continuing in position have can expansion the like investments and Noble. through to our part plan. of key the strategy XXXX. Vision execute we

internal external, of we enable flow capture to opportunities, Looking scale, to increase similar will ultimately ahead, cash conversion improve continue and that for us and both best shareholders. the pursue return margins, economies generate our

opportunity to as additional see pipeline potential M&A of to invest a healthy well as continue We internally.

Within Coming services. broad off we the QX, of is of our record good by pipeline outlook backlog, for our a demand momentum. a and half back year strong supported ES, with entered growing our suite project bullish the

to the HEPACO also we service to for numerous Within market legacy oil. our business quarters bolster SKSS, of opportunities. ahead prospects the in excited further ER the with about capabilities see a field synergy performance while despite and are stable demand current base environment We our expect providing combined

London like favorable. capitalize of continue our our on sales outlook initiatives Castrol for partnership. remains and Group XXXX to III, balance [ ] will the We Overall,

outstanding to track achieve deliver this financial remain performance expect and Vision our year an We XXXX goals. to on

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

Eric Dugas

Thank good morning, you, everyone. Mike, and

profitably encouraged on after achieving strong start the along first continued to has also revenue to levels showcased grow half the a bounce record with coupled Throughout of disposal year. expansion. ES its of XXXX and leveraging to see our EBITDA, We're uneven by to in and back delivered Slide with quarter, network, the ability statement We have X. this QX income margin recycling an segment service results adjusted businesses. Turning extensive nice SKSS our our

EBITDA over grew more of acquisition-related total delivered our Eric the a good expectations than $XX mix million year-over-year. million million $XXX was year line, Adjusted as as from up On in of growth came ago. we by a and revenues we above top $XXX organic and highlighted,

financial in XX.X%, to our the was resulting ago. percentage from than incentive was the legal demand from Our nonrecurring up margin across The the related efficiencies year-on-year primary basis and environmental improvement a ES adjusted to year results the are the an quarter as in in margin XX expense prior in were driven businesses, liabilities the XX.X%, point strength increased increase SG&A year Gross volumes realized QX, impressive and and XXX services by given acquired of quarter productivity we was gains segment. the strong basis the costs a XX.X% a network. drivers operational This higher in EBITDA compensation period. speaks points and expenses for revenue incremental seeing. and

revenue QX year mid- with year, primarily at to longer anticipate This full up term. in of from is range, year decreasing we expectations, came and our depreciation our of a as the now ahead due the acquisitions. XXXX, Consistent high between in but over amortization to million. just SG&A For a percentage XX% expense ago, $XXX last slightly

from in million, of depreciation range and we net from the million. year. in $XXX.X million, amortization $XXX prior in earnings was share XX% expect operations QX XXXX, per $XXX Income $XXX.X All $X.XX. XX% For to Due now to income up from resulting figures prior million was year. of up

sheet. X balance marketable million, quarter the the and from $XX QX. Cash $XXX at Turning million short-term about and end end to were up securities Slide of

which increased we reflects year. QX term that in billion HEPACO in million ended in the cash Our this collect by and and $X.X loan expect the driven balance under debt, just incremental months. acquisitions, finance issued coming QX that the $XXX of Noble with to the quarter to receivables at largely We transactions we is

Our shape. remains terrific balance sheet in

X.Xx debt due was significant ratio quarter debt-to-EBITDA no net end until Our XXXX. with at amounts coming

X.X%. overall Our at quarter end rate was interest

Turning Net from down on is of QX operations in million, up Slide XX. on year. $XXX flows prior up million, disposals, but to from provided which was $XXX QX cash Cash [indiscernible] from was spend more new in our now the QX due life investments including than $XX $XXX total to where million million from at $XX spend prior sits million. year Kimball incinerator, network, in our

flow prior For the slightly million, adjusted year. $XX free quarter, below was cash was which

our the $XXX For related the of net be million expect CapEx purchase to Baltimore to $XXX XXXX, to million million. million includes year. expansion range the $XX of This facility in $XX and range Kimball and we for this

During QX, at average of we of price share. an stock shares XX,XXX bought a back $XXX

approximately million XX, of As we remaining $XXX our June under program. had authorized repurchase

Noble on QX Based our conditions, of XX. adjusted $X.XXX $X.XXX billion at midpoint billion from billion, we in XX% range This and year and a Slide a our oil. XXXX HEPACO from this to a guidance [ midpoint. ] are assumes to $X raising contribution $XX XXXX to EBITDA market $X.XXX of results approximately with guidance Moving million increase million and a representing this

Looking quarterly perspective, of versus a we annual are XX% expecting guidance growth year. prior adjusted QX from to EBITDA our at XX%

strong performance segments Services, full EBITDA as XXXX guidance We higher XX% adjusted EBITDA XXXX. are to already we of our XX% complete, now the to adjusted increase follows: at from half Environmental in a we year With similar very in our to XXXX guidance second in midpoint a our expect performance half. to anticipating expect translate the first

and while continuing of to the expect generate our benefit also to addition capture core lines business synergies of volume continued We HEPACO. from year-over-year growth in

year our of market to lubricant of conditions, midpoint expect and to XXXX. our results severance here integration In our on the XXXX costs and be SKSS expect up adjusted our segment, related base increase relates corporate X% to year given in at environmental to XXXX. EBITDA guidance full midpoint to X% the QX. based negative which we to current and the compared from adjusted and legal incentive we guide, For increase XX% compensation our Higher results some liabilities, expenses. at EBITDA oil including to the XX% onetime expenses acquisitions, this were in incurred strong The discrete

acquisition-related will basis, prior corporate realize of flat essentially we the expect revenue be periods. to year. relates results segment with increases some future that we it of As opportunities to the synergy these Percentage are in the

range For with to million. XXXX, of adjusted we flow of be a cash $XXX million free to $XXX midpoint the currently in expect million, $XXX

As if midpoint flow previously, midpoint of I EBITDA expectation. translates of Baltimore pointed to back that at add our you'll arrive you the spend, and free and approximately which out cash XX% $XXX take adjusted million, Kimball adjusted

the In beyond. closing, see year, Eric enthusiasm about QX prospects continuation business of We growth will believe positive Mike's and we through our a in trends XXXX favorable remainder signs and carry of momentum was and share the the experienced this and I QX. for

opportunities, are the our ES full the completing HEPACO integration excited segment, we For bringing and waste of online. project of and about Kimball backlog

a about of we Overall, for year and in our in production the excited terms shareholders. in stabilized store volumes, has we're for XXXX business both the believe company we the and underway. collection, initiatives and great have SKSS, us For

Latanya, with for open please that, questions. And call the

Operator

you. time, first Thank Instructions] question-and-answer question a this session. conduct At [Operator from we'll James. Raymond Brown Our with Tyler comes

Patrick Brown

Big picture question.

this seem all we the watch So industrial solid production very that great. industrial was But doesn't record with quarter in story together backlogs. growth the great, economy as along the obviously,

of So waste the some in still lot could And is hoping reverberations I kind tightness hazardous it the of 'XX, 'XX. markets back that? was of that maybe you in a just Is think cleanup of 'XX? guys that you're bridge gap. that, the driving feeling Just guys into winning there can stream you solid Has there do work? what a momentum you any continue been believe of momentum? that share? to is steady market really Is Are deferred reason there just

Eric Gerstenberg

this Yes, Tyler, begin is Eric. I'll here.

incineration. tightness made has of they're our waste a line right be doing. think whole hazardous there I industry, across continues business points to There been the and lot in tightness with you great So all how

of has on business had to customers, of we've get Our an with into our on grow customers. awesome our done just team many those different job all though that though executing strategies, penetrated more lines

drum board. as Technical environmental we've growth We've the So an seen Safety-Kleen share when our growing think business, strong also and the project about market the growth example, seen Service Environmental. growth you the our Area, in drum across

to done volume. We our handling tremendous really TSDFs. continue them of great incineration They've our job of from amount a to volumes all to see all through facilities handle treatment a landfill, this wastewater

that we've yes, network and done all, in all So factors that is company and mentioned a just have all really how unparalleled. played of our into as those you growing volumes facilities leveraging really our

the to So job great team.

Patrick Brown

Yes. be QX strongest that And how -- at by an achievable basis of that it points I point? but aspirational margin maybe up? in stack, years, over isn't a XX% XX.X% aspirational that if XXX really seasonally segments Eric up as ES? Kimball could Is it margin ES, a the something ramps but typically And but know this get particularly moved at is they're on X-year look is in have around margins, know your the is goal 'XX over I that you record I quarter, so bit

Eric Gerstenberg

taking at growth, costs the QX is, Yes, out leveraging did certainly year-over-year. fixed -- think to achievable, Tyler. the we leveraging our margin, when look it's of point, even managing for and with job Services It's record that team network Industrial throughout a efficiencies it having your great a network. The turnarounds and less you and

have to work shoot where able of in the that today. that margin XX% do yes, lot area. Environmental XXXX be we great that business a into continue So and to getting believe for goal put will expansion we that are And we to we to

Michael Battles

the on and back that's years. past Tyler, if look mean XXXX I up from been to you happening few for basis I'd points 'XX, XXX Thing over that. that, add

So all I is reasons think that Eric the for trend articulated. that kind of continues just

Patrick Brown

the then And on color was What just linger And million large-scale bit revenue does Yes, second absolutely. the ER. into of that half? more little exactly a that? $XX

Eric Gerstenberg

that went events had, $XX sizable was there in the and Northwest. the Midwest say point would We large a that I couple as had into other that Pacific couple well that out. in we Yes, all million of events one a of one we

that's down. carry the starting for into to to continue over QX. of wind to Some going they're But part, most

Michael Battles

We -- and Service out, call were an because wanted emergency response so It great had just to them in large. they did Tyler, a that's core. quarter Field business,

surprising. So it's large not beat kind that of in They just ones some QX. were really very drove the

Eric Gerstenberg

HEPACO of responding our pointed those script, ERs acquisition together, between our them add really it, just And out job needs effect we minimizing solid service of to and and managing field and quickly teams of of supporting did to taking think as environment. to care teams, our they the the I them a in the

to job great there. team So the

Patrick Brown

my good the just last And get solid, sheet waste there. assets talked is to nontraditional a Perfect. better to shape. but into us There's little pipeline, has Obviously, about a likely you it M&A bit color 'XX. interest out a ways there. in can cash flow here. Balance one you bit little squeeze solid give of more in lot is Mike, in

Just little larger? year smaller possibly and just more something on into maybe about pipeline, or the Can in next? even a the color this tuck-ins you talk prospects either

Michael Battles

Sure, Tyler.

the been for transactions I see I but interest service can be So up. think mean, multiples drifting drifting the that recent though are multiples we say, public you've environmental I'd rates, that as given the in in say have company going you up. businesses, marketplace, think type down they'd noticed, Even given transactions. I'd

the are others. by paid see can being that You multiples

to there's pay have We there. value we're think going so up. And to

make strategic we financial some to away and strategically assets Want always from bit watched I've financially. that disciplined our that although have make we sense. be [indiscernible] want And as said, sense we things sure Tyler, assessment. in But to these

very to to be continue we're So disciplined. going

strong. strong is I'd on the business they're -- is X both the trying to We're the would turn going pipeline I very be both say this business, after nothing acquisitions. all Noble, the about said, HEPACO pipeline of is to being Eric X returns as months. or Environmental the already We Tyler, active. on and to Services oil think be pretty out and them benefits say, is, but here, and on see great is I it's already new

that think I to of So more there's here. kind come

leverage balance do leverage the that we generation down space continue without look at below today. going to of the think year, a of because I kind is it sheet, X actually and the to to the get the and QX end you And great on forecasted in of cash tick we're we've in have by given M&A guide kind flow given the the

Operator

question Revich next The Sachs. Goldman with comes Jerry from

Adam Bubes

for Adam is Jerry on This today.

I think in X% incinerator pricing quarter. the was

how incinerator the And core the in trend then down wondering do us your and waste talk that can and price business, Just you for half pipeline to mix? back year year? expect mix last product breaks versus you to about how hazardous landfill between of

Eric Gerstenberg

Yes, Jerry.

second we of one bulk before, Park at we've incinerator. talked unit direct burn streams. the a largest is for large That quarter, had the about really as shutdown Deer our waste of So consumers our

We'll to to on continue work It's in things inflation overall from that effect bit an the incineration down we're incineration that. continued X% outpace change on bit. strong to little X%. pricing. pricing but the continue Year-to-date, again, year, just that side, have had a and as overall, a we last to performance. So ways But on certainly of little mix

and all of from in On projects they're really year-to-date large base able too, we area, those job, showed quarter business both we've second units. been pipelines the strong, leverage great and into are performance a that and and And on those into the sites. some landfill, landfill drum those our incineration projects into to volumes as up pipeline our

all operating how and to business, deferred business, also side, can growth look really revenue $XXX of quarterly the were we met the quarter-over-quarter when incineration second we our And business recently in deferred lines business, On we just year-over-year our revenue, growing look review, incineration, at at just segment they're not solid. units. our in so million. on when across pipelines our from the but solid Real see different quarter, up ticked the pipeline you

So we're leverage that up, to in incinerator that online we're bringing really QX. Kimball really excited

solid So momentum some there.

Adam Bubes

waste rolling Was all, wondering affecting the the broadly, regulations EPA? how could talk about by recent if PFAS set at you the Chevron see you when if opportunity, just more hazardous

Eric Gerstenberg

Yes.

is They've affects of think record are don't effect you not is any the long Our disposal those changed. interpretation, have play us record going in going Chevron Adam, it when be how for They're all think that regulations, environment place aren't a managed waste today on of been for rigid to PFAS. particularly option around really the codes and at time. waste to regulations about a that we regulatory The Chevron is very right foundation to that. in

out side, really how And much years environment. that play industry. Hard there's analytical so going to rolling to of much to going for PFAS Chevron a on data the affect affected is the has and the the how think continue so those over regulations PFAS ever are to

Operator

The comes Baird. with Manthey next from David question

David Manthey

Yes.

First question Kimball. on

So circle I be adds, trying Tech incineration more here from And revenue to But take you than dollars. it approximately subsegment it Kimball. even the that could contribution in on to I'm XX% assuming higher-value the think, relates as it Services can capacity. streams, waste to

of a I ago, gave many years think landfills, and Tech Services labor you in TSDFs, incineration, kinds between past, all transportation, skilled wastewater in breakdown the back us things. of

incineration incremental X/X does we piece, that Services do it When services. subsegment? is that which of going about that require some those think assume to Tech just you other impact Or of it's capacity, maybe

point finer EBITDA -- could. to? revenues, just us to rate get run you the So can just you've given you you think if on I'm trying get a I'm

Eric Gerstenberg

And exceed the the begin, guys tons you these When add. incineration you and there's just unit. it higher network from about our customers, of bringing customers, XX,XXX we've XX,XXX that we're drinks collecting there from add will level, sure capacity don't Dave. and our When think will a When that looking I'm which Sure, to XX%, and in. really we leverage out at look and a also collection Kimball and range tons landfill through talked wastewater waste. able treatment collect I'll waste online, incineration year, we're next recycling. about broad we're revenue the to at our of

we're So stream needs. waste their on servicing of all customers based

network been the backed capacity has get Technical revenue, industry excited on that waste of those the about different compilation -- We're online. up your incineration. Obviously, benefit Services to question will that a to it's network. the all But streams

Michael Battles

The new I'd add you only think thing not the to that is that XX%. so about XX%, David, when incinerator,

a it's it So more lot look look but also Eric when Tech not I'd financials, said, not you just XX. as our incineration. and is at say capacity, Service the at you

TSDS, XX we treatment have wastewater facility. We have

We recycling it over is really across facilities permanent facilities XXX North America. have [indiscernible]

different handle of all those so facilities streams. types waste, waste And

it. of it's the to part -- get landfills a of because that, are talk big we so And really of and about kind it, hard it's incineration biggest part I

-- Yes very a service very it's big large a is business. business. is But very technical a

really to it's that it about think I so important think And broadly.

lot in came And so is said the you a facility tech really has follow but up Services it the not trans year-over-year, -- net. incineration, much those we see -- in volume is of for services is and like think that answer a around Tech down hard volumes getting and in businesses results which us think all And probably how X/X in, that's and of which X/X the disposal. just versus the quarter, over testament The QX. I what drove that we're kind price. and to in pin XX% all entire the from Eric that's were it's of which great, is I to really

David Manthey

trying such Got understand you that the it's that the trying given normal helpful. just large referenced that seen, you'd forward portion addition to million, to either. nothing just That's then and ER of of is going of it. it's because here is that report And to related, HEPACO you've I'm rate this And expect that's a $XX you'll of the kind not to see forward? going that's work quarter, HEPACO continue a scale second, business? highest but something

Michael Battles

out. guess there we've large many Dave, Mike. years quarters important we've followed these done them had you large I they're was going think QX. and fair items. And thought of it you of events, And I so don't know, many, probably multimer for early us amount really don't quarters kind this there I because I is to a when called think we -- were for as last think

And so these are that the given just growth just was business -- strong important really service thought quarter. field it the in in we

as Just are look, we going we're markets the comparison from frankly, beneficiary about next that to a year, you large at think pretty that. say, so it as there to good that some of events think we were just

in the if year. half some have There to large So there's I not be back it's without we again, me tell pretty -- for to know do quarters it. the of we've some events just are cutoffs. interest us large It's I'm tell. events. you tough going sure gone --

the But it well more great beat of we'll had out was quarter So the of results events, given to items. the it scale out. in size from thought comparison and a -- we given of we the as see fit, we call appropriate and standpoint, was it to a call really these kind material

Eric Gerstenberg

And point. across It was network. weren't these our It Dave, was a really really service not to the just just due was events -- It of one all field other business. HEPACO. also mix

David Manthey

appreciate I it.

Operator

next question from & Needham with James Ricchiuti comes Company. The

James Ricchiuti

you what follow-up And were just to discussing. a maybe just

higher $XX lot March. at Is a that driving had you that's targeting million. now million what's $XX about it for and business? expectations HEPACO from been You -- think EBITDA of only I talk about the can acquired you

tracking be a little wonder seems bit ahead that. it to I if expectations. talk you So of about could And

Eric Dugas

has little million for Sure, larger I the We from into And the the year And integrating ahead we few minutes. also, of we to the our that Services Services $X increase response months ability to Harbors from here. of a our talking business. had a the the with bright I'll think full to job the resources, been last integrate back. folks HEPACO HEPACO network, partially start the of due great James. team projected of about you're line spots of correct. one that for office The schedule HEPACO legacy is Field that Eric Field sharing labor. was HEPACO absolutely But one. integration jobs did Clean X Dugas our about that emergency probably the some into acquisition expectations what did done ER we've sharing talked

here press successful some done hiring we've internalize what more year. with and us EBITDA in court and this been on that work at Field additional So of that full heads. Harbors Services Clean drive put allowed into to a We've is more really it's been

we And as said And well. on bit I that probably acquisition. better really as those of number. excited schedule increased in synergies that So little now, said, a front a of a are and about terms little all like ahead reasons the we times the bit few business

Michael Battles

of amazing bit, over points basis The good gone allowed over is Yes. growth us It's only a over has people years down I'd add, that ago. that basis other down good our turnover Dugas XXX longer quite thing keep since to points over growth. and XXX year-over-year it and brought since voluntary kind X Eric really up actually and

really and gives us just and Field organization, a employees, has a but us margins. the of kind better variety retaining Service, really good across and team safety done in on good So fronts it and of not job good the of helped training that's

James Ricchiuti

to years? and that. bit And that Group I next the talked wonder scale expecting business guys maybe on perhaps how plans and you're expanding X over about III little what you a could elaborate if you X it. to Got seeing you're for

Michael Battles

we we time been We've on Group blended our in a well the actually using had Group James, Yes, gallons. ran now refinery full quarter. III, that into III -- ran

been just when the it's to process. of re-refining think think pilot plan I a oil success. And another running, that now get running a type for I different we're about it's

a out good think But So XX that there's we've -- and of to million into cost Group over and got dedicate in kind We III price test gallons our good will network and growth XX to planned X there's that or run out. ability incremental higher be million, there, to X could and at we drive save plants business. this to gallons point. a of more able use,

James Ricchiuti

I potentially the versus wonder things Just that how you're last And business a earlier to as how in give just area, on with conversations us you're in having PFAS. the sense are this changing question year? customers for you. evolve seeing

Eric Gerstenberg

Yes, here. James, Eric

as So And really remedial all water be incineration projects solutions you really event to from the really know growth analytical industrial seen we've with drinking and water. PFAS, looked at from to landfill managing to of when total talked we and you, in honest providing performing capabilities areas. about we've from past, those

Our water treatment anti we've that PFAS industrial and has seen drinking. for

soils has on well we've some end. our increasing business remediation as Our front been the started of project as contaminated of that analytical of

really areas. we're it So all seeing from

other The changeups. key areas is AFFF

removed have is there's today, when complement seen where has remove go their somebody phone some being be is That or and So other and and been response longer really to that site. last to dumps. we've emergency had an it no from on in really event discharged we've facility foam you site, And to at has discussion it in projects an certain AFFF. one their

we're of seeing well. so activities as those And types

Operator

with from The Sommer Truist Tobey Securities. next comes question

Tobey Sommer

the I'll to far regulations? presidential sort change opportunity How of follow PFAS do different last a rules as through a that up diminish question. the for potential environmental you on see and potentially blends administration as new or

Eric Gerstenberg

Yes.

record at change usual. be with to regulations on -- or it's So in business all. we administration as continue going be to have think PFAS what continue to any really would don't think happening we regulations that effect a is -- Will

Michael Battles

The -- And Democrats, mean Liberals. on really I waste it's kind Conservative, hazardous years and of here, view the the we're year. the that I that, years about -- through next company So for Tobey Republicans, administration. company XX talking been that XX has think to overall important don't growing based changes right?

Tobey Sommer

transformational out market. in large How News deals? about potentially reports appetite describe for would M&A recent your ES months in opportunities you the

Michael Battles

hurdles think I deals -- the I'm much XXXX. -- said hard track of like get back so day, take excited to business lot size right that to to of open we're certainly in to those, opportunities. sometimes about of those. kind small. the and It's within We're the And XXXX grow But small of meet back spending of our kind we're that ones done. in on years. kind track. about in on They Vision our open business, strategic our to what the kind Big of those double We financial. work a to those we and we're meet capital hardest the of We're are types. We're the X because do got open talked to strategic sense they

those so And make kind these to of we're sense. open

Tobey Sommer

to little could then the capacity a And topic. if you ask utilization incinerator elaborate on and bit I

trend the ramps where influence capacity quarters the is pricing that As market? to there in the change entering a new been or historically, in the has capacity an

Eric Gerstenberg

No, We change. really there do anticipate not hasn't. any Tobey. pricing

across going In fact, price continue to to we're the drive improvement network.

-- and So backlog, tons we after the fuel and different and next about our we'll our about growth. EBITDA of doing to sequentially been talked do We ramp that We look capacity drum has again, year how the as grow customers, all drums collecting and up, XX,XXX will don't earlier. continue team volumes to from that. of

Tobey Sommer

That's a alternatives. than bullish more answer some

Operator

The comes next Brian with Stifel. Butler from question

Brian Butler

of X% kind on trending First and more bit is business. into little kind -- XXXX you the a into improvement? the color half and kind of oil how for spot to maybe one, of X% the just of price on back the the When that built what's charge guidance maybe SKSS

Michael Battles

that. actually you into only gave good of kind your about the the half you III. Well, answer good traction you you [indiscernible] question like making midpoint blended put half of morning. back the volumes. We're we've minutes on if you there I think on [indiscernible] Group business, the when go, XX% oil to Brian, The very our this but think gotten good pricing, making making we've good we're into -- call. the of for about about on is on trends guide get I'm of feel as when pricing good back we think The We it's of conservative traction to view think the We our traction capital, happy XX on year, this it. first you. the thing,

I think that stabilize business all us continue so are and to going it. And help those to of grow

see, we that when as but you the at back have pretty you and pricing to the modest so numbers. look of we And X% growth of rates kind for don't kind year the those in achieve to year, half of X%, the aggressive really have

Eric Gerstenberg

on just year-to-date. we'd it, our to Brian. continues blended sales on team The probably execute strategy So build

volume year-over-year. is Our blended and sales up

in job efforts trying as to good call, And are stabilize the earlier how our to about So that. we're Mike talked III in beginning Group pay off.

on nice there. there's So some things going

Brian Butler

SKSS, was That for go ES my now. question Great. and to one Okay. I'll

you, the capacity maybe could for view with talk as high-level potential as we ] kind to capacity captive as commercial adding do incineration about back getting thoughts manifest the coming market Just in Veolia commercial maybe is at on some option looking added you incinerators more side? [ and an maybe the how of

Eric Gerstenberg

Brian. Yes,

companies First, customers. the our those or all the of mentioned there, out in as past, we've captive units

help them streams. work to to variety manage of waste partners as to continue We with their

difficult. to to when really individual think regulations state There about any is go that commercial have I EPA you captive sizable scale, through. taking it you is really, and and think a

of of we on. the market to with hard work what's change have material them type knowing to conditions that that captive it's we So any going any them really and going of in imagine is all all know type

Michael Battles

that and close compliance the opportunity On they us the the likely creates for regulations more process cost Brian, scenario, given that and and would network. and and more the would be

Brian Butler

potential Yes. the was, more question gets what's that of I as guess added? capacity that them closing was focus the of

Eric Gerstenberg

few that We few the that continue targets. there's over is utilization past years. believe to prime down are a Their

that have that changed. those affect the waste been consuming have So the utilization that that -- of and also the streams captives products means those And that they're units. making

We know again, out required the to going there also is it's they're guidelines, MAC to that be we change statute. -- that by looking is and believe while EPA to which do

down so evaluate We'll going And that that. they're path.

are if those captive that those offline. -- types by invested be So catalysts could those companies coming things those which lower are capital utilization, having affect all units a of has to to upgrade

Brian Butler

update an maybe destruction And you there OTM has PFAS progressed? Okay. an Can one XX PFAS testing, real quick. is give the one there? that and on last an update incineration on from maybe And the

Eric Gerstenberg

Yes.

high-temperature this are it's We the EPA with that and doing OTM proving repro out jointly that the achieving preferred working progressing XX well. really destruction on is be fall, We'll thermal -- again testing once method.

on well very And so we're that. proceeding

Operator

Kaye comes Noah with question Oppenheimer. from next The

Noah Kaye

under ]. election really IIJA [ an It's question, fund adjacent flow the about

do bill some not looking of of get kind you season? that to tailwind Is just do in kind more we that I has impact guess yet. been seeing but already got 'XX, helpful. at a that of actually of even fund, of we right, most you the spending think possibility that quantify X.X is And into X.X for bill the activity election increase as I super anything for obligated, are awarding spent your P&L a we've help 'XX, think year? out can how this there's of then an

Michael Battles

of how spend difficult in best you, -- kind affects and So the making kind [ standpoint, ] of tell work. of then the in Mike. SIPs all down. will level us that or to the they're is a that very history of But project it's here's from It's correlate for to it quarters kind company's directly statements this the is how no, difficult financial very our us QX for infrastructure investment at from one project the I and rolls of level in

company that, drove the and a that will us. to the of drove And amount that from -- -- looks type -- this So that draw this I stuff by investment spend can't and to this But I try almost you that tell it's very contractor like came government really work. seems go good be came of strong pipeline into to that XXXX. pipeline

well, and was QX change would work. there like, from that leadership that terrific, are see and pipeline sales that to our of how that view. pipeline has and can we cannot. But strong no No, how impact can the from team work seeing much that very the organization signs been we talking give tell here's Here's I us? are you spent? So -- it I is you what I a much

to cleaning I super all that other America. fund some and love into and that you're in up messes way continues it's invest and spend view on the We're about talking great So the nasty areas, a XXXX. in

Noah Kaye

on for XX, XXXX. M&A the track goes you million fine transformational HEPACO for as with far year HEPACO multiples you of The flow those M&A, and will cash do you're the way, first M&A will -- if winning my that You mentioned say, kind earlier, to on pay track getting Noble, be EBITDA, this just feel do organic targets you're on M&A, investors. plus like With probably around But or correct $XXX XXXX. $XXX Vision Vision feel math. as I XX you're that you're right, you're of the free incremental. million you in like version by

So whether fair tracking What on go. those you're there's a is targets? view the towards way to

Michael Battles

take to line Yes. path it line. just straight No, as not and fact the we it's direct never showed to success was It of But a is because never was, as a that we the kind had easy. something.

smart months we're answer And And capital year, to that half to to the shareholder opportunities, is be about sure we're The so businesses, that going close billion spent we do it to I do asking we're it. and to going the not of strong you're make are we kind ago. these continue almost that going to now really and first integrate more? in going X of waiting when $X.X say it for look would we're

mean bucks And way world. returns And there's and are so the -- answer. like mean that necessarily I we I our are cost that be and Baltimore unbelievable them drive M&A project the going think that our will that continuing to we, that of big the Kimball are to as to to leadership more team, get a the going project there shareholders. to that evaluate out to I did doesn't think

there, like strategic I portfolio do to way necessarily your sense financial and we're as track. that your us to our that We're And on not as think do have buy won't fit it's in capital portfolio. to get it. well to What to So waste make things our it. is we going going we're

Noah Kaye

it. appreciate I

Operator

from [Operator Instructions] Jon Windham next question with UBS. comes Our

Jonathan Windham

to wanted the quarter. bit Obviously, a the thoughts your States. back great the exposure to United to hear I'd from be quarter. growth system in result in little the Maybe on your on interested electricity step I

about the on that. gas bigger growth, going of to infrastructure it. that exposure of you natural I'm certain talk Environmental which parts Services right resumption Appreciate is investments now trends more our more of One transmission. just in have could electricity means if may business wondering

Eric Gerstenberg

Jon, Eric Yes, here. this is

Service business, support Field largest we'll utilities on, our those we they continue through units. And to maintain as their -- we growth growth. see support So to really helping of some with nation's from the what's going

Our service with different really them. those doing a as We partners. accolades with number utilities. of gotten conjunction them how We've we're work in with

grow growing, the continue utility with clients. to we're going so infrastructure those And is to as

for Field around opportunity Services. good a So us, particularly

Operator

to turn further like closing this no would I Mr. are for comments. floor time. back questions Gerstenberg over the There at to

Eric Gerstenberg

today. on enjoys there. you, us everyone the out in some will back stay of thanks Please and the we safe you road for get listening months. this coming be And hope summer. Thank the We we of seeing remainder out joining as

Operator

teleconference. today's conclude does This you. Thank

time. your have your for great lines a at day. you disconnect participation, Thank You may this and

Clean Harbors (CLH) 31 Jul 242024 Q2 Earnings call transcript