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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.
Revenue by Segment
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.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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