Q2 2024 Clean Harbors Inc Earnings Call Transcript
Key Points
- Clean Harbors Inc (CLH) delivered exceptional Q2 performance, surpassing guidance with record volumes of containerized waste and sustained pricing momentum.
- Revenue and adjusted EBITDA were the highest in the company's history, with adjusted EBITDA margin improving by 50 basis points year over year.
- Environmental Services segment enjoyed a 12% revenue increase, driven by robust demand and the first full quarter of Hypercom acquisition.
- SKSS segment posted a substantial sequential increase from Q1, fueled by the start of the summer driving season and improved lubricant prices.
- The company is on track to open a new state-of-the-art incinerator in Kimball, Nebraska, in Q4, which will add significant capacity.
- Corporate costs were higher in the quarter due to incremental headcount from acquisitions, greater incentive compensation, and discrete expenses related to legal and environmental liability matters.
- Industrial Services revenue declined by 10% due to reduced turnaround activity compared to last year.
- The market did not fully incorporate announced base oil price increases, leading to a weaker spot market for non-contracted volumes.
- SG&A expense as a percentage of revenue was 12.7% in Q2, higher than the prior year period due to increased costs from acquired businesses and nonrecurring expenses.
- Depreciation and amortization in Q2 were up from a year ago, primarily due to acquisitions, impacting overall profitability.
Good day, ladies and gentlemen, and welcome to the Clean Harbors Second Quarter 2024 earnings conference call.(Operator Instructions) As a reminder, this conference 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.
Thank you, Latonya, and good morning, everyone. With me on today's call are our Co-Chief Executive Officers, Eric Gerstenberg; and Mike Battles; and our EVP and Chief Financial Officer; Eric Dugas, and SVP of Investor Relations, Jim Buckley.
Slides for today's call are posted on our Investor Relations website, and we invite you to follow along. Matters we are discussing today that are not historical facts are considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Participants are cautioned not to place undue reliance on these statements, which reflect management
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