07/27/2022 | Press release | Distributed by Public on 07/27/2022 14:34
June 18, 2022 |
January 1, 2022 |
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ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | $ | 73,760 | $ | 56,269 |
Accounts receivable - net | 80,266 | 62,513 | ||
Inventory - net | 36,221 | 29,536 | ||
Assets held for sale | 1,125 | 1,125 | ||
Other current assets | 4,427 | 6,773 | ||
Total current assets | 195,799 | 156,216 | ||
Property, plant and equipment - net | 171,169 | 166,301 | ||
Right of use assets | 89,541 | 83,865 | ||
Equipment at customers - net | 25,107 | 24,146 | ||
Software and intangible assets - net | 44,610 | 45,949 | ||
Goodwill | 49,695 | 49,695 | ||
Investments at fair value | 3,000 | - | ||
Other assets | 616 | 692 | ||
Total assets | $ | 579,537 | $ | 526,864 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Accounts payable | $ | 45,043 | $ | 36,179 |
Current portion of lease liabilities | 22,576 | 20,146 | ||
Contract liabilities - net | 2,646 | 2,094 | ||
Accrued salaries, wages, and benefits | 7,669 | 8,980 | ||
Taxes payable | 8,503 | 8,474 | ||
Other current liabilities | 11,177 | 9,476 | ||
Total current liabilities | 97,614 | 85,349 | ||
Lease liabilities, net of current portion | 70,391 | 65,041 | ||
Other long term liabilities | 710 | 473 | ||
Contingent consideration | 1,410 | 2,819 | ||
Deferred income taxes | 32,070 | 31,126 | ||
Total liabilities | $ | 202,195 | $ | 184,808 |
STOCKHOLDERS' EQUITY: | ||||
Common stock - 26,000,000 shares authorized at $0.01 par value, 23,494,045 and 23,473,931 shares issued and outstanding at June 18, 2022 and January 1, 2022, respectively | $ | 235 | $ | 235 |
Additional paid-in capital | 206,296 | 204,920 | ||
Retained earnings | 171,052 | 137,067 | ||
Accumulated other comprehensive loss | (241) | (166) | ||
Total stockholders' equity | $ | 377,342 | 342,056 | |
Total liabilities and stockholders' equity | $ | 579,537 | $ | 526,864 |
Second Quarter Ended, | First Half Ended, | |||||||
June 18, 2022 |
June 19, 2021 |
June 18, 2022 |
June 19, 2021 |
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Revenues | ||||||||
Service revenues | $ | 75,583 | $ | 60,033 | $ | 144,490 | $ | 117,732 |
Product revenues | 74,790 | 51,551 | 139,272 | 93,817 | ||||
Rental income | 6,274 | 5,695 | 12,251 | 11,111 | ||||
Total revenues | $ | 156,647 | $ | 117,279 | $ | 296,013 | $ | 222,660 |
Operating expenses | ||||||||
Operating costs | $ | 104,755 | $ | 78,329 | $ | 206,538 | $ | 155,099 |
Selling, general, and administrative expenses | 15,024 | 13,039 | 28,759 | 25,228 | ||||
Depreciation and amortization | 6,777 | 5,619 | 13,285 | 9,401 | ||||
Other expense (income) - net | 1,001 | (330) | 791 | (439) | ||||
Operating income | 29,090 | 20,622 | 46,640 | 33,371 | ||||
Interest expense - net | 250 | 177 | 473 | 501 | ||||
Income before income taxes | 28,840 | 20,445 | 46,167 | 32,870 | ||||
Provision for income taxes | 7,733 | 5,334 | 12,182 | 8,553 | ||||
Net income | $ | 21,107 | $ | 15,111 | $ | 33,985 | $ | 24,317 |
Net income per share: basic | $ | 0.90 | $ | 0.65 | $ | 1.45 | $ | 1.04 |
Net income per share: diluted | $ | 0.89 | $ | 0.64 | $ | 1.44 | $ | 1.03 |
Number of weighted average shares outstanding: basic | 23,489 | 23,404 | 23,482 | 23,389 | ||||
Number of weighted average shares outstanding: diluted | 23,644 | 23,565 | 23,640 | 23,537 |
Second Quarter Ended, | ||||||||
June 18, 2022 | ||||||||
(thousands) |
Environmental Services |
Oil Business |
Corporate and Eliminations |
Consolidated | ||||
Revenues | ||||||||
Service revenues | $ | 72,979 | $ | 2,604 | $ | - | $ | 75,583 |
Product revenues | 12,634 | 62,156 | - | 74,790 | ||||
Rental income | 6,265 | 9 | - | 6,274 | ||||
Total revenues | $ | 91,878 | $ | 64,769 | $ | - | $ | 156,647 |
Operating expenses | ||||||||
Operating costs | 68,914 | 35,841 | - | 104,755 | ||||
Operating depreciation and amortization | 3,192 | 2,125 | - | 5,317 | ||||
Profit before corporate selling, general, and administrative expenses | $ | 19,772 | $ | 26,803 | $ | - | $ | 46,575 |
Selling, general, and administrative expenses | 15,024 | 15,024 | ||||||
Depreciation and amortization from SG&A | 1,460 | 1,460 | ||||||
Total selling, general, and administrative expenses | $ | 16,484 | $ | 16,484 | ||||
Other expense (income) - net | 1,001 | 1,001 | ||||||
Operating income | 29,090 | |||||||
Interest expense - net | 250 | 250 | ||||||
Income before income taxes | $ | 28,840 |
Second Quarter Ended, | ||||||||
June 19, 2021 | ||||||||
(thousands) |
Environmental Services |
Oil Business |
Corporate and Eliminations |
Consolidated | ||||
Revenues | ||||||||
Service revenues | $ | 56,403 | $ | 3,630 | $ | - | $ | 60,033 |
Product revenues | 10,627 | 40,924 | - | 51,551 | ||||
Rental income | 5,686 | 9 | - | 5,695 | ||||
Total revenues | $ | 72,716 | $ | 44,563 | $ | - | $ | 117,279 |
Operating expenses | ||||||||
Operating costs | 51,119 | 27,210 | - | 78,329 | ||||
Operating depreciation and amortization | 2,430 | 2,109 | - | 4,539 | ||||
Profit before corporate selling, general, and administrative expenses | $ | 19,167 | $ | 15,244 | $ | - | $ | 34,411 |
Selling, general, and administrative expenses | 13,039 | 13,039 | ||||||
Depreciation and amortization from SG&A | 1,080 | 1,080 | ||||||
Total selling, general, and administrative expenses | $ | 14,119 | $ | 14,119 | ||||
Other (income) - net | (330) | (330) | ||||||
Operating income | 20,622 | |||||||
Interest expense - net | 177 | 177 | ||||||
Income before income taxes | $ | 20,445 |
First Half Ended, | ||||||||
June 18, 2022 | ||||||||
(thousands) |
Environmental Services |
Oil Business |
Corporate and Eliminations |
Consolidated | ||||
Revenues | ||||||||
Service revenues | $ | 139,278 | $ | 5,212 | $ | - | $ | 144,490 |
Product revenues | 25,023 | 114,249 | - | 139,272 | ||||
Rental income | 12,228 | 23 | - | 12,251 | ||||
Total revenues | $ | 176,529 | $ | 119,484 | $ | - | $ | 296,013 |
Operating expenses | ||||||||
Operating costs | 136,532 | 70,006 | - | 206,538 | ||||
Operating depreciation and amortization | 6,081 | 4,209 | - | 10,290 | ||||
Profit before corporate selling, general, and administrative expenses | $ | 33,916 | $ | 45,269 | $ | - | $ | 79,185 |
Selling, general, and administrative expenses | 28,759 | 28,759 | ||||||
Depreciation and amortization from SG&A | 2,995 | 2,995 | ||||||
Total selling, general, and administrative expenses | $ | 31,754 | $ | 31,754 | ||||
Other expense (income) - net | 791 | 791 | ||||||
Operating income | 46,640 | |||||||
Interest expense - net | 473 | 473 | ||||||
Income before income taxes | $ | 46,167 | ||||||
First Half Ended, | ||||||||
June 19, 2021 | ||||||||
(thousands) | Environmental Services | Oil Business | Corporate and Eliminations | Consolidated | ||||
Revenues | ||||||||
Service revenues | $ | 109,706 | $ | 8,026 | $ | - | $ | 117,732 |
Product revenues | 21,374 | 72,443 | - | 93,817 | ||||
Rental income | 11,093 | 18 | - | 11,111 | ||||
Total revenues | $ | 142,173 | $ | 80,487 | $ | - | $ | 222,660 |
Operating expenses | ||||||||
Operating costs | 102,999 | 52,100 | - | 155,099 | ||||
Operating depreciation and amortization | 4,008 | 3,058 | - | 7,066 | ||||
Profit (loss) before corporate selling, general, and administrative expenses | $ | 35,166 | $ | 25,329 | $ | - | $ | 60,495 |
Selling, general, and administrative expenses | 25,228 | 25,228 | ||||||
Depreciation and amortization from SG&A | 2,335 | 2,335 | ||||||
Total selling, general, and administrative expenses | $ | 27,563 | $ | 27,563 | ||||
Other (income) - net | (439) | (439) | ||||||
Operating income | 33,371 | |||||||
Interest expense - net | 501 | 501 | ||||||
Income before income taxes | $ | 32,870 | ||||||
Heritage-Crystal Clean, Inc. | ||||||||
Reconciliation of our Net Income Determined in Accordance with U.S. GAAP to Earnings Before Interest, Taxes, Depreciation & Amortization (EBITDA) and to Adjusted EBITDA | ||||||||
(Unaudited) | ||||||||
Second Quarter Ended, | First Half Ended, | |||||||
(thousands) |
June 18, 2022 |
June 19, 2021 |
June 18, 2022 |
June 19, 2021 |
||||
Net income | $ | 21,107 | $ | 15,111 | $ | 33,985 | $ | 24,317 |
Interest expense - net | 250 | 177 | 473 | 501 | ||||
Provision for income taxes | 7,733 | 5,334 | 12,182 | 8,553 | ||||
Depreciation and amortization | 6,777 | 5,619 | 13,285 | 9,401 | ||||
EBITDA (a)
|
$ | 35,867 | $ | 26,241 | $ | 59,925 | $ | 42,772 |
Non-cash compensation (b)
|
1,292 | 1,668 | 2,785 | 2,886 | ||||
Loss on disposal of re-refinery assets (c)
|
1,194 | - | 1,194 | - | ||||
Costs associated with business acquisitions (d)
|
823 | - | 835 | - | ||||
Provision for civil action settlement (e)
|
750 | - | 750 | - | ||||
Adjusted EBITDA (f)
|
$ | 39,926 | $ | 27,909 | $ | 65,489 | $ | 45,658 |
(a) | EBITDA represents net income before provision for income taxes, interest income, interest expense, depreciation and amortization. We have presented EBITDA because we consider it an important supplemental measure of our performance and believe it is frequently used by analysts, investors, our lenders, and other interested parties in the evaluation of companies in our industry. Management uses EBITDA as a measurement tool for evaluating our actual operating performance compared to budget and prior periods. Other companies in our industry may calculate EBITDA differently than we do. EBITDA is not a measure of performance under U.S. GAAP and should not be considered as a substitute for net income prepared in accordance with U.S. GAAP. EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under U.S. GAAP. Some of these limitations are: | |||||||
EBITDA does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments; | ||||||||
EBITDA does not reflect interest expense or the cash requirements necessary to service interest or principal payments on our debt; | ||||||||
EBITDA does not reflect tax expense or the cash requirements necessary to pay for tax obligations; and | ||||||||
Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements. | ||||||||
We compensate for these limitations by relying primarily on our U.S. GAAP results and using EBITDA only as a supplement. | ||||||||
(b) | Non-cash compensation expenses which are recorded in SG&A. | |||||||
(c) | Loss on disposal of assets related to our re-refinery operations. | |||||||
(d) | Acquisition costs associated with the pending Patriot Environmental business acquisition which are recorded in SG&A. | |||||||
(e) | Civil action settlement accrual recorded in SG&A. | |||||||
(f) | We have presented Adjusted EBITDA because we consider it an important supplemental measure of our performance and believe it may be used by analysts, investors, our lenders, and other interested parties in the evaluation of our performance. Other companies in our industry may calculate Adjusted EBITDA differently than we do. Adjusted EBITDA is not a measure of performance under U.S. GAAP and should not be considered as a substitute for net income prepared in accordance with U.S. GAAP. Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under U.S. GAAP. | |||||||
Use of Non-GAAP Financial Measures | ||||||||
Adjusted net earnings (loss) and adjusted net earnings (loss) per share are non-GAAP financial measures. Non-GAAP financial measures should be considered in addition to, but not as substitute for, financial measures prepared in accordance with GAAP. Management believes that adjusted net earnings (loss) and adjusted net earnings (loss) per share provide investors and management useful information about the earnings impact from certain non-routine items for the second quarter and first half year of 2022 compared to the second quarter and first half year of 2021. | ||||||||
Reconciliation of our Net Earnings (loss) and Net Earnings (loss) Per Share Determined in Accordance with U.S. GAAP to our Non-GAAP Adjusted Net Earnings (Loss) and Non-GAAP Adjusted Net Earnings (loss) Per Share | ||||||||
(In thousands, except per share data) | ||||||||
(Unaudited) | ||||||||
Second Quarter Ended, | First Half Ended, | |||||||
June 18, 2022 | June 19, 2021 | June 18, 2022 | June 19, 2021 | |||||
GAAP net earnings | $ | 21,107 | $ | 15,111 | $ | 33,985 | $ | 24,317 |
Loss on disposal of re-refinery assets (a)
|
1,194 | - | 1,194 | - | ||||
Tax effect on disposal loss | (318) | - | (313) | - | ||||
Costs associated with business acquisitions (b)
|
823 | - | 835 | - | ||||
Tax effect on business acquisitions costs | (219) | - | (219) | - | ||||
Provision for civil action settlement (c)
|
750 | - | 750 | - | ||||
Tax effect on provision for settlement | (200) | - | (196) | - | ||||
Adjusted net earnings | $ | 23,137 | $ | 15,111 | $ | 36,036 | $ | 24,317 |
GAAP diluted earnings per share | $ | 0.89 | $ | 0.64 | $ | 1.44 | $ | 1.03 |
Loss on disposal of re-refinery assets per share | 0.05 | - | 0.05 | - | ||||
Tax effect on loss on disposal per share | (0.01) | - | (0.01) | - | ||||
Costs associated with business acquisitions per share | 0.03 | - | 0.04 | - | ||||
Tax effect on costs associated with business acquisitions per share | (0.01) | - | (0.01) | - | ||||
Provision for civil action settlement per share | 0.03 | - | 0.03 | - | ||||
Tax effect on provision for civil action settlement per share | (0.01) | - | (0.01) | - | ||||
Adjusted diluted earnings per share | $ | 0.97 | $ | 0.64 | $ | 1.52 | $ | 1.03 |
(a) Loss on disposal of assets related to our re-refinery operations. | ||||||||
(b) Acquisition costs associated with the pending Patriot Environmental business acquisition which are recorded in SG&A. | ||||||||
(c) Civil action settlement accrual recorded in SG&A. | ||||||||