NORWELL, Mass. — Clean Harbors has reported its financial results for the first quarter, and the company exceeded expectations.
“Strong demand for our services resulted in a better-than-expected performance in the first quarter,” said Mike Battles, co-chief executive officer at Clean Harbors. “We delivered record Q1 Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) driving year-over-year margin improvement. Our Environmental Services (ES) segment once again led the way. ES continues to benefit from a growing interest in our broad array of services, high-value disposal and recycling waste streams, pricing execution and an expanding project pipeline, fueled by customer demand.”
Clean Harbors delivers a broad range of services such as end-to-end hazardous waste management, emergency spill response, industrial cleaning and maintenance and recycling services.
Revenues grew 5% to $1.38 billion compared with $1.31 billion in the same period of 2023. Income from operations increased to $125.5 million compared with $121.0 million in the first quarter of 2023.
Net income was $69.8 million, or $1.29 per diluted share compared with $72.4 million, or $1.33 per diluted share, for the same period in 2023, and $74.1 million, or $1.36 per diluted share on an adjusted basis in the prior year period.
Adjusted EBITDA grew 7% to $230.1 million compared with $215.1 million in the same period of 2023.
“Our ES segment delivered a 16% increase in Adjusted EBITDA and a 130-basis point margin improvement year-over-year on 10% revenue growth,” said Eric Gerstenberg, co-chief executive officer at Clean Harbors. “All of our ES businesses grew revenue from a year ago, led by Technical Services with growth of 11%. While incineration utilization came in as expected at 79%, average incineration price was up 6% reflecting pricing actions and higher-value waste streams into our network. Although landfill tonnage was down modestly from a year ago due to weather-related impacts on the West Coast, average price per ton increased 16% on healthy drum volumes and base business. Safety-Kleen Environmental Services continued its strong performance with revenue growth of 9%. On a mix of organic growth and contributions from acquisitions, our Industrial Services and Field Services grew 7% and 10%, respectively, as demand remained robust.”
In the second quarter of 2024, Clean Harbors expects Adjusted EBITDA to grow 7% to 8% from the second quarter of 2023.
For full-year 2024, Clean Harbors expects:
- Adjusted EBITDA in the range of $1.1 billion to $1.15 billion or a midpoint of $1.125 billion, which represents 11% growth year-over-year. This Adjusted EBITDA range is based on anticipated GAAP net income in the range of $376 million to $419 million.
- Adjusted free cash flow in the range of $340 million to $400 million, or a midpoint of $370 million, which includes approximately $65 million of spending related to the Kimball incinerator and $20 million for its Baltimore expansion. This range is based on anticipated net cash from operating activities in the range of $740 million to $830 million.
“Underlying market conditions, such as reshoring and the regulatory environment, are driving favorable demand for our services, which should allow us to build on our ES momentum in the coming quarters,” Gerstenberg said.
Since retiring from a career as an outdoor recreation professional from the State of Arkansas, Kris Rutherford has worked as a freelance writer and, with his wife, owns and publishes a small Northeast Texas newspaper, The Roxton Progress. Kris has worked as a ghostwriter and editor and has authored seven books of his own. He became interested in the trucking industry as a child in the 1970s when his family traveled the interstates twice a year between their home in Maine and their native Texas. He has been a classic country music enthusiast since the age of nine when he developed a special interest in trucking songs.
