Clean Harbors Announces Third-Quarter 2026 Financial Results
-
Delivers 21% Growth in Revenues to a Record
$1.87 Billion , Driven by Both Operating Segments -
Generates 75% Increase in Q3 Net Income to
$208.1 Million , or EPS of$3.93 -
Achieves 42% Growth in Q3 Adjusted EBITDA to
$456.1 Million ; Expands Adjusted EBITDA Margin YoY by370 Basis Points to 24.4% - Raises 2026 Guidance for Both Adjusted EBITDA and Adjusted Free Cash Flow
-
Announces Executive Transition –
Eric Gerstenberg to Become Sole CEO onJanuary 1 ;Mike Battles to Retire as Co-CEO and Board Member at Year-End (See Separate News Release Issued Today)
“Our third-quarter results reflect the strength of our market position and robust demand for our environmental services and sustainable products,” said
Third-Quarter 2026 Results
Revenues increased 21% to
Net income increased 75% to
Adjusted EBITDA (see description and reconciliation below) increased 42% to
Third-Quarter 2026 Segment Review
“Our ES segment generated an Adjusted EBITDA margin of 27.4%, marking its 18th consecutive quarter of year-over-year margin expansion,” said Gerstenberg. “Our Field Services business was the largest contributor with revenue growth of more than 70%. This was driven by considerable emergency response activity, including one substantial event that generated approximately
“SKSS segment revenue increased 46% in Q3 and Adjusted EBITDA was 209% higher, with segment margin more than doubling from the year-ago period,” said
Business Outlook
“We continue to pursue our growth strategy through a combination of acquisitions and organic growth investments,” Gerstenberg said. “The successful completion of the ES&H and
“We expect to enter 2027 with momentum across both operating segments,” Battles concluded. “Within Environmental Services, collection volumes into our disposal and recycling network remain strong, supported by improving
Financial Guidance
In the fourth quarter of 2026,
-
Adjusted EBITDA in the range of
$1.44 billion to$1.48 billion , with a midpoint of$1.46 billion . This Adjusted EBITDA range is based on anticipated GAAP net income in the range of$528 million to$563 million . -
Adjusted free cash flow in the range of
$600 million to$660 million , with a midpoint of$630 million . This range is based on anticipated net cash from operating activities in the range of$970 million to$1,090 million .
Non-GAAP Results:
Adjusted EBITDA Reconciliation
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Net income |
$ |
208,100 |
|
|
$ |
118,799 |
|
|
$ |
441,765 |
|
|
$ |
304,384 |
|
|
Accretion of environmental liabilities |
|
3,531 |
|
|
|
3,499 |
|
|
|
10,575 |
|
|
|
10,710 |
|
|
Stock-based compensation |
|
11,745 |
|
|
|
8,922 |
|
|
|
36,141 |
|
|
|
22,620 |
|
|
Depreciation and amortization |
|
122,703 |
|
|
|
114,729 |
|
|
|
360,309 |
|
|
|
342,994 |
|
|
Other income, net |
|
(1,524 |
) |
|
|
(3,517 |
) |
|
|
(1,223 |
) |
|
|
(1,982 |
) |
|
Interest expense, net of interest income |
|
37,438 |
|
|
|
35,700 |
|
|
|
108,500 |
|
|
|
108,883 |
|
|
Provision for income taxes |
|
74,095 |
|
|
|
42,027 |
|
|
|
156,899 |
|
|
|
103,641 |
|
|
Adjusted EBITDA |
$ |
456,088 |
|
|
$ |
320,159 |
|
|
$ |
1,112,966 |
|
|
$ |
891,250 |
|
|
Adjusted EBITDA Margin |
|
24.4 |
% |
|
|
20.7 |
% |
|
|
22.0 |
% |
|
|
19.7 |
% |
Adjusted Free Cash Flow Reconciliation
An itemized reconciliation between reported GAAP net cash from operating activities and adjusted free cash flow is as follows (in thousands):
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Net cash from operating activities |
$ |
419,203 |
|
|
$ |
301,987 |
|
|
$ |
664,673 |
|
|
$ |
511,632 |
|
|
Additions to property, plant and equipment |
|
(172,842 |
) |
|
|
(94,445 |
) |
|
|
(397,480 |
) |
|
|
(303,169 |
) |
|
Cash investments in strategic growth projects |
|
71,983 |
|
|
|
11,904 |
|
|
|
107,305 |
|
|
|
24,340 |
|
|
Proceeds from sale and disposal of fixed assets |
|
4,789 |
|
|
|
11,187 |
|
|
|
8,483 |
|
|
|
15,250 |
|
|
Adjusted free cash flow |
$ |
323,133 |
|
|
$ |
230,633 |
|
|
$ |
382,981 |
|
|
$ |
248,053 |
|
Adjusted EBITDA Guidance Reconciliation
An itemized reconciliation between projected GAAP net income and projected Adjusted EBITDA is as follows (in millions):
|
|
For the Year Ending |
||
|
Projected GAAP net income |
|
to |
|
|
Adjustments: |
|
|
|
|
Accretion of environmental liabilities |
16 |
to |
15 |
|
Stock-based compensation |
50 |
to |
53 |
|
Depreciation and amortization |
500 |
to |
490 |
|
Interest expense, net |
160 |
to |
155 |
|
Provision for income taxes |
186 |
to |
204 |
|
Projected Adjusted EBITDA |
|
to |
|
Adjusted Free Cash Flow Guidance Reconciliation
An itemized reconciliation between projected GAAP net cash from operating activities and projected adjusted free cash flow is as follows (in millions). The Company excludes significant strategic growth investments, from which the Company expects to realize future long-term benefits, as they are not indicative of free cash flow generation for the current period.
|
For the Year Ending |
|||
|
Projected net cash from operating activities |
|
to |
|
|
Additions to property, plant and equipment |
(530) |
to |
(590) |
|
Cash investments in strategic growth projects |
145 |
to |
145 |
|
Proceeds from sale and disposal of fixed assets |
15 |
to |
15 |
|
Projected adjusted free cash flow |
|
to |
|
Conference Call Information
About Clean Harbors
Clean Harbors (NYSE: CLH) is North America’s leading provider of environmental and industrial services. The Company serves a diverse customer base, including a majority of Fortune 500 companies. Its customer base spans a number of industries, including chemical, manufacturing and refining, as well as numerous government agencies. These customers rely on Clean Harbors to deliver a broad range of services such as end-to-end hazardous waste management, emergency spill response, industrial cleaning and maintenance, and recycling services. Through its Safety-Kleen subsidiary, Clean Harbors also is a leading provider of parts washers and environmental services to commercial, industrial and automotive customers, as well as North America’s largest re-refiner and recycler of used oil. Founded in 1980 and based in Massachusetts, Clean Harbors operates in the United States, Canada, Mexico, Puerto Rico and India. For more information, visit www.cleanharbors.com.
Safe Harbor Statement
Any statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “plans to,” “seeks,” “will,” “should,” “estimates,” “projects,” “may,” “likely,” “potential,” “outlook” or similar expressions. Such statements may include, but are not limited to, statements about the Company’s future financial and operating results, plans, strategy, objectives and goals, strategic initiatives, cost management initiatives, pricing and productivity initiatives, contingent liabilities, interest expense, liquidity, business, economic and market conditions, trends, customer demand, expectations regarding new customer contracts, impacts of tariffs and new legislation, acquisitions, growth opportunities and investments, expectations, challenges and other statements that are not historical facts. Such statements are based upon the beliefs and expectations of Clean Harbors’ management as of the date of this press release only and are subject to certain risks and uncertainties that could cause actual results to differ materially, including, without limitation: operational and safety risks; risks relating to the failure of new or existing technologies; risks associated with the use of artificial intelligence; cybersecurity risks; the occurrence of natural disasters or other catastrophic events, as well as their residual macroeconomic effects; risks associated with retaining and hiring key personnel; environmental liability and product liability risks relating to hazardous waste management and other components of the Company’s business; negative economic, industry or other developments, including market volatility or economic downturns; risks associated with management’s assumptions relating to expansion of the Company’s landfills; reductions in the demand for emergency response services at industrial facilities or on roadways, railways or waterways, and other remedial projects and regulatory developments; reductions in the demand for oil products and automotive services and volatility in oil prices in the markets the Company serves; changes in statutory and regulatory requirements and risks relating to extensive environmental laws and regulations; risks associated with existing and potential litigation; risks associated with the Company’s identification and execution of strategic capital expenditures, acquisitions and divestitures and their related liabilities; risks relating to the availability and sufficiency of the Company’s insurance coverage, self-insurance, surety bonds, letters of credit and other forms of financial assurance; the impact of new tax legislation or changes in tax regulations and interpretations; the imposition of trade sanctions or tariffs; fluctuations in interest rates and foreign currency exchange rates; risks relating to the Company’s indebtedness and covenants in its debt agreements; risks associated with certain anti-takeover provisions under the Massachusetts Business Corporation Act and the Company’s By-Laws, and those items identified as “Risk Factors” in Clean Harbors’ most recently filed reports on Form 10-K and Form 10-Q. Forward-looking statements are neither historical facts nor assurances of future performance. Therefore, readers are cautioned not to place undue reliance on these forward-looking statements. Clean Harbors undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements other than through its filings with the Securities and Exchange Commission, which may be viewed in the “Investors” section of Clean Harbors’ website at www.cleanharbors.com.
|
|
|||||||||||||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
|
(in thousands, except per share amounts) |
|||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
|
|
||||||||||||
|
|
|
2026 |
|
|
|
2025 |
|
|
|
2026 |
|
|
|
2025 |
|
|
Revenues |
$ |
1,869,449 |
|
|
$ |
1,549,337 |
|
|
$ |
5,063,991 |
|
|
$ |
4,531,141 |
|
|
Cost of revenues |
|
1,208,014 |
|
|
|
1,048,490 |
|
|
|
3,348,359 |
|
|
|
3,103,871 |
|
|
Selling, general and administrative expenses |
|
217,092 |
|
|
|
189,610 |
|
|
|
638,807 |
|
|
|
558,640 |
|
|
Accretion of environmental liabilities |
|
3,531 |
|
|
|
3,499 |
|
|
|
10,575 |
|
|
|
10,710 |
|
|
Depreciation and amortization |
|
122,703 |
|
|
|
114,729 |
|
|
|
360,309 |
|
|
|
342,994 |
|
|
Income from operations |
|
318,109 |
|
|
|
193,009 |
|
|
|
705,941 |
|
|
|
514,926 |
|
|
Other income, net |
|
1,524 |
|
|
|
3,517 |
|
|
|
1,223 |
|
|
|
1,982 |
|
|
Interest expense, net |
|
(37,438 |
) |
|
|
(35,700 |
) |
|
|
(108,500 |
) |
|
|
(108,883 |
) |
|
Income before provision for income taxes |
|
282,195 |
|
|
|
160,826 |
|
|
|
598,664 |
|
|
|
408,025 |
|
|
Provision for income taxes |
|
74,095 |
|
|
|
42,027 |
|
|
|
156,899 |
|
|
|
103,641 |
|
|
Net income |
$ |
208,100 |
|
|
$ |
118,799 |
|
|
$ |
441,765 |
|
|
$ |
304,384 |
|
|
Earnings per share: |
|
|
|
|
|
|
|
||||||||
|
Basic |
$ |
3.94 |
|
|
$ |
2.22 |
|
|
$ |
8.36 |
|
|
$ |
5.67 |
|
|
Diluted |
$ |
3.93 |
|
|
$ |
2.21 |
|
|
$ |
8.34 |
|
|
$ |
5.65 |
|
|
Shares used to compute earnings per share - Basic |
|
52,752 |
|
|
|
53,518 |
|
|
|
52,812 |
|
|
|
53,659 |
|
|
Shares used to compute earnings per share - Diluted |
|
52,897 |
|
|
|
53,713 |
|
|
|
52,969 |
|
|
|
53,871 |
|
|
|
|||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||
|
(in thousands) |
|||||
|
|
|
|
|
||
|
Current assets: |
(unaudited) |
|
|
||
|
Cash and cash equivalents |
$ |
423,544 |
|
$ |
826,315 |
|
Short-term marketable securities |
|
93,010 |
|
|
127,363 |
|
Accounts receivable, net |
|
1,273,770 |
|
|
1,044,137 |
|
Unbilled accounts receivable |
|
218,442 |
|
|
160,888 |
|
Inventories and supplies |
|
407,922 |
|
|
372,088 |
|
Prepaid expenses and other current assets |
|
96,346 |
|
|
116,452 |
|
Total current assets |
|
2,513,034 |
|
|
2,647,243 |
|
Property, plant and equipment, net |
|
2,757,283 |
|
|
2,541,067 |
|
Other assets: |
|
|
|
||
|
Operating lease right-of-use assets |
|
254,827 |
|
|
255,084 |
|
|
|
1,843,273 |
|
|
1,479,050 |
|
Permits and other intangibles, net |
|
866,755 |
|
|
653,027 |
|
Other long-term assets |
|
48,433 |
|
|
48,585 |
|
Total other assets |
|
3,013,288 |
|
|
2,435,746 |
|
Total assets |
$ |
8,283,605 |
|
$ |
7,624,056 |
|
|
|
|
|
||
|
Current liabilities: |
|
|
|
||
|
Current portion of long-term debt |
$ |
12,600 |
|
$ |
12,600 |
|
Accounts payable |
|
551,756 |
|
|
506,592 |
|
Deferred revenue |
|
97,948 |
|
|
81,529 |
|
Accrued expenses and other current liabilities |
|
525,728 |
|
|
441,788 |
|
Current portion of closure, post-closure and remedial liabilities |
|
20,312 |
|
|
19,112 |
|
Current portion of operating lease liabilities |
|
81,345 |
|
|
75,226 |
|
Total current liabilities |
|
1,289,689 |
|
|
1,136,847 |
|
Other liabilities: |
|
|
|
||
|
Closure and post-closure liabilities, less current portion |
|
131,194 |
|
|
125,038 |
|
Remedial liabilities, less current portion |
|
81,180 |
|
|
86,547 |
|
Long-term debt, less current portion |
|
2,877,298 |
|
|
2,763,563 |
|
Operating lease liabilities, less current portion |
|
178,294 |
|
|
184,308 |
|
Deferred tax liabilities |
|
400,248 |
|
|
384,207 |
|
Other long-term liabilities |
|
208,488 |
|
|
197,886 |
|
Total other liabilities |
|
3,876,702 |
|
|
3,741,549 |
|
Total stockholders’ equity, net |
|
3,117,214 |
|
|
2,745,660 |
|
Total liabilities and stockholders’ equity |
$ |
8,283,605 |
|
$ |
7,624,056 |
|
|
|||||||
|
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
|
(in thousands) |
|||||||
|
|
Nine Months Ended |
||||||
|
|
|
|
|
||||
|
Cash flows from operating activities: |
|
|
|
||||
|
Net income |
$ |
441,765 |
|
|
$ |
304,384 |
|
|
Adjustments to reconcile net income to net cash from operating activities: |
|
|
|
||||
|
Depreciation and amortization |
|
360,309 |
|
|
|
342,994 |
|
|
Allowance for doubtful accounts |
|
9,571 |
|
|
|
6,520 |
|
|
Amortization of deferred financing costs and debt discount |
|
3,930 |
|
|
|
5,024 |
|
|
Accretion of environmental liabilities |
|
10,575 |
|
|
|
10,710 |
|
|
Changes in environmental liability estimates |
|
(2,218 |
) |
|
|
(8,933 |
) |
|
Other income, net |
|
(1,223 |
) |
|
|
(1,982 |
) |
|
Stock-based compensation |
|
36,141 |
|
|
|
22,620 |
|
|
Environmental expenditures |
|
(9,756 |
) |
|
|
(10,960 |
) |
|
Changes in assets and liabilities, net of acquisitions: |
|
|
|
||||
|
Accounts receivable and unbilled accounts receivable |
|
(276,946 |
) |
|
|
(113,131 |
) |
|
Inventories and supplies |
|
(35,736 |
) |
|
|
8,301 |
|
|
Other current and non-current assets |
|
31,230 |
|
|
|
(5,467 |
) |
|
Accounts payable |
|
22,517 |
|
|
|
(35,492 |
) |
|
Other current and long-term liabilities |
|
74,514 |
|
|
|
(12,956 |
) |
|
Net cash from operating activities |
|
664,673 |
|
|
|
511,632 |
|
|
Cash flows used in investing activities: |
|
|
|
||||
|
Additions to property, plant and equipment |
|
(397,480 |
) |
|
|
(303,169 |
) |
|
Proceeds from sale and disposal of fixed assets |
|
8,483 |
|
|
|
15,250 |
|
|
Acquisitions, net of cash acquired |
|
(689,044 |
) |
|
|
— |
|
|
Additions to intangible assets including costs to obtain or renew permits |
|
(2,830 |
) |
|
|
(1,528 |
) |
|
Purchases of available-for-sale securities |
|
(37,665 |
) |
|
|
(62,108 |
) |
|
Proceeds from sale of available-for-sale securities |
|
71,927 |
|
|
|
74,968 |
|
|
Net cash used in investing activities |
|
(1,046,609 |
) |
|
|
(276,587 |
) |
|
Cash flows used in financing activities: |
|
|
|
||||
|
Change in uncashed checks |
|
1,716 |
|
|
|
(2,639 |
) |
|
Tax payments related to withholdings on vested restricted stock |
|
(15,612 |
) |
|
|
(13,833 |
) |
|
Repurchases of common stock |
|
(77,133 |
) |
|
|
(117,001 |
) |
|
Proceeds from employee stock purchase plan |
|
3,611 |
|
|
|
3,360 |
|
|
Deferred financing costs paid |
|
(691 |
) |
|
|
— |
|
|
Payments on finance leases |
|
(38,096 |
) |
|
|
(25,088 |
) |
|
Principal payments on debt |
|
(9,450 |
) |
|
|
(11,327 |
) |
|
Borrowing from revolving credit facility |
|
120,000 |
|
|
|
— |
|
|
Net cash used in financing activities |
|
(15,655 |
) |
|
|
(166,528 |
) |
|
Effect of exchange rate change on cash |
|
(5,180 |
) |
|
|
3,488 |
|
|
(Decrease) increase in cash and cash equivalents |
|
(402,771 |
) |
|
|
72,005 |
|
|
Cash and cash equivalents, beginning of period |
|
826,315 |
|
|
|
687,192 |
|
|
Cash and cash equivalents, end of period |
$ |
423,544 |
|
|
$ |
759,197 |
|
|
Supplemental information: |
|
|
|
||
|
Cash payments for interest and income taxes: |
|
|
|
||
|
Interest paid |
$ |
114,037 |
|
$ |
133,520 |
|
Income taxes paid, net of refunds |
|
97,644 |
|
|
93,531 |
|
Non-cash investing activities: |
|
|
|
||
|
Property, plant and equipment accrued |
|
45,391 |
|
|
36,604 |
|
ROU assets obtained in exchange for operating lease liabilities |
|
55,559 |
|
|
51,736 |
|
ROU assets obtained in exchange for finance lease liabilities |
|
60,586 |
|
|
59,937 |
Supplemental Segment Data (in thousands)
|
|
Three Months Ended |
||||||||||||||||||
|
Revenue |
|
|
|
||||||||||||||||
|
|
Third-Party Revenues |
|
Intersegment Revenues (Expenses), net |
|
Direct Revenues |
|
Third-Party Revenues |
|
Intersegment Revenues (Expenses), net |
|
Direct Revenues |
||||||||
|
Environmental Services |
$ |
1,538,438 |
|
$ |
12,683 |
|
|
$ |
1,551,121 |
|
$ |
1,318,580 |
|
$ |
12,720 |
|
|
$ |
1,331,300 |
|
Safety-Kleen Sustainability Solutions |
|
331,011 |
|
|
(12,683 |
) |
|
|
318,328 |
|
|
230,757 |
|
|
(12,720 |
) |
|
|
218,037 |
|
Corporate |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
Total |
$ |
1,869,449 |
|
$ |
— |
|
|
$ |
1,869,449 |
|
$ |
1,549,337 |
|
$ |
— |
|
|
$ |
1,549,337 |
|
|
Nine Months Ended |
||||||||||||||||||
|
Revenue |
|
|
|
||||||||||||||||
|
|
Third-Party Revenues |
|
Intersegment Revenues (Expenses), net |
|
Direct Revenues |
|
Third-Party Revenues |
|
Intersegment Revenues (Expenses), net |
|
Direct Revenues |
||||||||
|
Environmental Services |
$ |
4,225,418 |
|
$ |
34,792 |
|
|
$ |
4,260,210 |
|
$ |
3,855,677 |
|
$ |
36,771 |
|
|
$ |
3,892,448 |
|
Safety-Kleen Sustainability Solutions |
|
838,573 |
|
|
(34,792 |
) |
|
|
803,781 |
|
|
675,278 |
|
|
(36,771 |
) |
|
|
638,507 |
|
Corporate |
|
— |
|
|
— |
|
|
|
— |
|
|
186 |
|
|
— |
|
|
|
186 |
|
Total |
$ |
5,063,991 |
|
$ |
— |
|
|
$ |
5,063,991 |
|
$ |
4,531,141 |
|
$ |
— |
|
|
$ |
4,531,141 |
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
Adjusted EBITDA |
|
|
|
|
|
|
|
||||||||
|
Environmental Services |
$ |
425,392 |
|
|
$ |
357,229 |
|
|
$ |
1,121,897 |
|
|
$ |
1,008,014 |
|
|
Safety-Kleen Sustainability Solutions |
|
126,482 |
|
|
|
40,937 |
|
|
|
252,456 |
|
|
|
107,502 |
|
|
Corporate |
|
(95,786 |
) |
|
|
(78,007 |
) |
|
|
(261,387 |
) |
|
|
(224,266 |
) |
|
Total |
$ |
456,088 |
|
|
$ |
320,159 |
|
|
$ |
1,112,966 |
|
|
$ |
891,250 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20261028315826/en/
EVP and Chief Financial Officer
781.792.5100
InvestorRelations@cleanharbors.com
SVP Investor Relations
781.792.5100
Buckley.James@cleanharbors.com
Source:
