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Sep 30, 2020
Clean Harbors Q3 2020 Earnings Report
Clean Harbors reported strong third-quarter results, exceeding expectations due to the resilience of its business model and the dedication of its people.
Key Takeaways
Clean Harbors announced strong third-quarter results with revenues of $779.3 million, income from operations of $83.9 million, and net income of $54.9 million, or $0.99 per diluted share. Adjusted EBITDA was $161.2 million, including a $13.3 million benefit from government assistance programs. The company experienced a sequential pick up from the second quarter across several core lines of business, particularly within Safety-Kleen.
Revenues reached $779.3 million, compared to $891.7 million in the same period of 2019.
Net income was $54.9 million, or $0.99 per diluted share, compared to $36.4 million, or $0.65 per diluted share, for the same period in 2019.
Adjusted EBITDA was $161.2 million, including $13.3 million of benefit from U.S. and Canadian government assistance programs, compared with $156.6 million in the same period of 2019.
COVID-19 decontamination work generated $29 million in revenue, contributing to a 20% top-line increase in Field Services.
Clean Harbors
Clean Harbors
Clean Harbors Revenue by Segment
Revenue by Segment
Environmental Services Revenue
CapyFin.comSafety-Kleen Sustainability Solutions Revenue
CapyFin.com Forward Guidance
Clean Harbors anticipates continued success in the fourth quarter of 2020, driven by market leadership, emergency response capabilities, and the COVID-19 decontamination business. They expect a sequential uptick in incineration utilization and continued recovery in Industrial and Technical Services. Safety-Kleen's branch business is improving, and re-refineries are back online with stable base oil pricing.
Positive Outlook
- Market leadership and renowned emergency response capabilities enable capitalization on opportunities.
- Prudent cost actions and reduced capital spending have driven record Adjusted EBITDA margins and adjusted free cash flow.
- COVID-19 decontamination business can help hedge against potential slowdowns in other parts of the Company.
- Anticipate a sequential uptick in incineration utilization in the fourth quarter.
- Core service offerings for Industrial Services and Technical Services are expected to close out the year on an upward trajectory.
Challenges Ahead
- Virus-related project delays remain, delaying full recovery for landfills until 2021.
- Safety-Kleen branch business remains below historical levels.
- Potential for new shelter-in-place mandates could disrupt the recovery of Safety-Kleen's business.
- Sensitive to the possibility of new shelter-in-place mandates that could disrupt the recovery of this business.
- None
Revenue & Expenses
Visualization of income flow from segment revenue to net income