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Clean Harbors (CLH) Beats on Q1 Earnings & Revenues, View Up

Zacks Equity Research

Clean Harbors, Inc.CLH reported solid first-quarter 2021 results wherein earnings and revenues surpassed the Zacks Consensus Estimate.

Adjusted earnings per share of 42 cents outpaced the Zacks Consensus Estimate by 61.5% and increased 50% year over year. Total revenues of $808.1 million beat the consensus mark by 2.7% and declined 6% year over year due to the unprecedented market conditions.

So far this year, shares of Clean Harbors have gained 23.2%, outperforming the 17% surge of the industry it belongs to.

Let’s check out the numbers in detail.

Revenues by Segment

Environmental Services revenues of $654.6 million declined 7.2% year over year. Safety-Kleen Sustainability Solutions revenues of $153.47 million grew 0.1% year over year.

Profitability Performance

Adjusted EBITDA of $129.45 million increased 2.8% year over year. Adjusted EBITDA margin increased 130 basis points (bps) year over year to 16%. The uptick was aided by greater volumes of high-value waste streams in the company’s disposal network and higher pricing environment for base oil, coupled with ongoing cost-control and productivity initiatives.

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Segment wise, Environmental Services’ adjusted EBITDA was $140.25 million, down 3.8% year over year. Safety-Kleen Sustainability Solutions’ adjusted EBITDA of $31.63 million, up 30.7% year over year.

Clean Harbors, Inc. Price, Consensus and EPS Surprise

Clean Harbors, Inc. price-consensus-eps-surprise-chart | Clean Harbors, Inc. Quote

Balance Sheet & Cash Flow

Clean Harbors exited first-quarter 2021 with cash and cash equivalents of $496.38 million compared with $519.10 million at the end of the prior quarter. Inventories and supplies were $219.49 million compared with $220.49 million in the prior quarter. Long-term debt of $1.55 billion was flat sequentially.

The company generated $103 million in net cash from operating activities in the reported quarter. Adjusted free cash flow was $62.29 million.

Guidance

For the second quarter of 2021, Clean Harbors expects adjusted EBITDA to register 15-20% year-over-year growth.

Clean Harbors has raised its guidance for the full year. Adjusted EBITDA is now anticipated between $560 million and $600 million compared with the prior-guided range of $545-$585 million. Net income is now anticipated between $116 million and $157 million, compared with the prior-guided range of $105-$146 million.

Adjusted free cash flow is now expected between $230 million and $270 million, compared with the prior-guided range of $215-$255 million. Net cash from operating activities is now projected between $415 million and $475 million, compared with the prior-guided range of $400-$460 million.

Currently, Clean Harbors carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Business Services Companies

Equifax’s EFX first-quarter 2021 adjusted earnings of $1.97 per share beat the Zacks Consensus Estimate by 29.6% and improved on a year-over-year basis. Revenues of $1.21 billion outpaced the consensus estimate by 7.9% and improved 26.6% year over year on a reported basis as well as on a local-currency basis.

Robert Half’s RHI first-quarter 2021 earnings of 98 cents per share beat the consensus mark by 22.5% and were up 24.1% year over year. Revenues of $1.4 billion surpassed the consensus mark by 3.3% but declined 7.2% year over year on a reported basis and 7.6% on an adjusted basis.

Omnicom’s OMC first-quarter 2021 adjusted earnings of $1.33 per share beat the consensus mark by 16.7% and increased 11.8% year over year. Total revenues of $3.4 billion surpassed the consensus estimate by 3.6% and marginally increased year over year.

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