Clean Harbors reports rise in earnings

Norwell, Massachusetts-based Clean Harbors Inc., which has a portfolio of waste-related environmental and industrial service companies, has reported second quarter 2024 revenue and net income figures that both are higher than those from one year ago.

“The positive trends that have contributed to the growth of our business in recent years continued in the second quarter, fueling an excellent performance that exceeded our expectations,” Clean Harbors co-CEO Mike Battles says.

“Our environmental services (ES) segment benefited from strong organic growth and the late March acquisition of Hepaco. Safety-Kleen Sustainability Solutions (SKSS) rebounded sequentially from the first quarter on improved base oil and lubricant pricing momentum.”

Revenue at Clean Harbors rose 11 percent to $1.55 billion compared with $1.40 billion in the same time frame of 2023. Its net income off $133.3 million, or $2.46 per diluted share, rose by 15.1 percent compared with $115.8 million, or $2.13 per diluted share, for the same period in 2023.

Securities analyst firm Stifel Financial Corp., reacting to the results, is maintaining its “buy” rating on Clean Harbors stock. The St. Louis-based firm says Clean Harbors’ second quarter results exceeded expectations again with better than expected revenue growth and earnings before interest, taxes, depreciation and amortization (EBITDA) margins.

Clean Harbors co-CEO Eric Gerstenberg says several members of the Clean Harbors portfolio contributed to the profitable second quareter.

“Field Services drove the revenue growth with a 64 percent increase, primarily reflecting the acquisition of Hepaco combined with strong organic growth in our legacy business,” he says.

“During the quarter, the HEPACO integration proceeded well, as evidenced by the Hepaco and legacy Field Services teams collaborating on several large emergency response events. Technical Services experienced 14 percent revenue growth compared to the second quarter of 2023 due to higher network volumes.”

The firm’s incineration utilization rate was 88 percent for the quarter, up from 84 percent one year ago, and Clean Harbors' landfill tonnage rose 4 percent year on year and its average landfill price per ton charge increased by 5 percent.

“We enter the second half of 2024 with healthy demand and momentum in our core disposal, recycling and service businesses," Gerstenberg says. "Within Environmental Services, we believe that our record backlog, healthy project pipeline, upcoming incinerator opening and steady demand for our broad suite of services positions us well for continued success.”

The company’s new incinerator in Kimball, Nebraska, is on track to begin processing hazardous waste in the fourth quarter of 2024.

"We also expect the Hepaco acquisition, which is off to a terrific start, to further bolster our Field Services business and emergency response capabilities, while providing numerous synergy opportunities," Gerstenberg says. “We plan to capitalize on initiatives like Group III production, higher blended sales and our new partnership with Castrol for its MoreCircular offering, which has the potential to lower the carbon footprints of fleets in the years ahead.

“Overall, we continue to maintain a favorable outlook for the company for the remainder of the year. We expect to deliver an outstanding financial performance to shareholders in 2024 and are on track to achieve our Vision 2027 goals.”