Quest Resource Holding Corporation Reports Second Quarter 2023 Financial Results
14 Agosto 2023 - 3:00PM
Quest Resource Holding Corporation (NASDAQ: QRHC) ("Quest"), a
national leader in environmental waste and recycling services,
today announced financial results for the second quarter ended June
30, 2023.
Second Quarter 2023 Highlights
- Revenue was $74.5 million, a 3.1% decrease compared with the
second quarter of 2022.
- Gross profit was $13.5 million, a 7.9% decrease compared with
the second quarter of 2022 and a 6.9% sequential increase compared
with the first quarter of 2023.
- Gross margin was 18.1% of revenue compared with 19.1% for the
second quarter of 2022.
- GAAP net loss per diluted share attributable to common
stockholders was $(0.04), compared with net income of $0.05 per
diluted share for the second quarter of 2022.
- Adjusted EBITDA was $5.0 million, compared with $6.6 million
during the second quarter of 2022, and a 26.2% sequential increase
compared to the first quarter of 2023.
- Adjusted net income per diluted share was $0.07 compared with
adjusted net income of $0.19 per diluted share during the second
quarter of 2022.
Year-to-Date 2023 Highlights (June 30,
2023)
- Revenue was $148.6 million, a 0.1% increase compared with the
same period of 2022.
- Gross profit was $26.1 million, a 0.8% increase compared with
the same period of 2022.
- Gross margin was 17.6% of revenue compared with 17.5% during
the same period of 2022.
- GAAP net loss per diluted share attributable to common
stockholders was $(0.15), compared with $(0.05) during the same
period of 2022.
- Year-to-date Adjusted EBITDA was $9.0 million, compared to
$10.3 million during the same period of 2022.
- Adjusted net income per diluted share was $0.10, compared with
$0.25 per diluted share during the same period of
2022.
“Our team delivered another strong quarter with positive
momentum. We added new business, improved efficiencies, and made
significant progress with acquisition integration, leading to a 7%
sequential increase in gross profit and a 26% sequential increase
in Adjusted EBITDA. At the same time, we posted strong operating
cash flow, averaging $2.5 million per quarter during the past three
quarters, and further reducing our long-term debt. Subsequent to
the end of the second quarter, we have paid down an additional $2
million of our Monroe Capital facility, for a total of $7 million
reduction for the year,” said S. Ray Hatch, President and Chief
Executive Officer of the Company.
“We expect momentum to continue through the second half of the
year and we remain on track to deliver double-digit gross profit
growth for the year 2023. At least part of that sequential
improvement will come from a recent win with a significant new
customer in a new industry vertical,” continued Hatch. “In the
coming quarters, we expect the growth rates of adjusted EBITDA to
outpace the growth rates of gross profit dollars, as we see the
benefit of investments to improve efficiencies and operating
leverage.”
Second Quarter 2023 Earnings Conference Call and
Webcast
Quest will conduct a conference call on Monday, August 14, 2023,
at 5:00 PM ET, to review the financial results for the second
quarter ended June 30, 2023. Investors interested in participating
on the live call can dial 1-855-327-6837 or 1-631-891-4304. The
conference call, which may include forward-looking statements, is
also being webcast and is available via the investor relations
section of Quest’s website at https://investors.qrhc.com/investors.
A replay of the webcast will be archived on Quest’s investor
relations website for 90 days.
Reconciliation of U.S. GAAP to Non-GAAP Financial
Measures
In this press release, non-GAAP financial measures, "Adjusted
EBITDA," and “Adjusted Net Income” are presented. From
time-to-time, Quest considers and uses these supplemental measures
of operating performance in order to provide an improved
understanding of underlying performance trends. Quest believes it
is useful to review, as applicable, both (1) GAAP measures that
include (i) depreciation and amortization, (ii) interest expense,
(iii) stock-based compensation expense, (iv) income tax expense,
and (v) certain other adjustments, and (2) non-GAAP measures that
exclude such items. Quest presents these non-GAAP measures because
it considers them an important supplemental measure of Quest's
performance. Quest's definition of these adjusted financial
measures may differ from similarly named measures used by others.
Quest believes these measures facilitate operating performance
comparisons from period to period by eliminating potential
differences caused by the existence and timing of certain expense
items that would not otherwise be apparent on a GAAP basis. These
non-GAAP measures have limitations as an analytical tool and should
not be considered in isolation or as a substitute for the Company's
GAAP measures. (See attached tables "Reconciliation of Net Income
(Loss) to Adjusted EBITDA" and “Adjusted Net Income Per
Share”).
About Quest Resource Holding Corporation
Quest is a national provider of waste and recycling services
that enable larger businesses to excel in achieving their
environmental and sustainability goals and responsibilities. Quest
delivers focused expertise across multiple industry sectors to
build single-source, client-specific solutions that generate
quantifiable business and sustainability results. Addressing a wide
variety of waste streams and recyclables, Quest provides
information and data that tracks and reports the environmental
results of Quest’s services, gives actionable data to improve
business operations, and enables Quest’s clients to excel in their
business and sustainability responsibilities. For more information,
visit www.qrhc.com.
Safe Harbor Statement
This press release contains forward-looking
statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended, which provides a "safe harbor"
for such statements in certain circumstances. The forward-looking
statements include, but are not limited to, our expectation that
our momentum will continue through the second half of the year and
that we remain on track to deliver double-digit gross profit growth
for the year 2023; our belief that sequential improvement will come
from a recent win with a significant new customer in a new industry
vertical; and our expectation that in the coming quarters, the
growth rates of adjusted EBITDA to outpace the growth rates of
gross profit dollars, as we see the benefit of investments to
improve efficiencies and operating leverage. Actual events or
results could differ materially from those discussed in the
forward-looking statements as a result of various factors,
including, but not limited to, competition in the environmental
services industry, the impact of the current economic environment,
the spread of major epidemics (including Coronavirus) and other
related uncertainties such as government-imposed travel
restrictions, interruptions to supply chains, commodity price
fluctuations, and extended shut down of businesses, and other
factors discussed in greater detail in our filings with the
Securities and Exchange Commission (“SEC”), including our Annual
Report on Form 10-K for the year ended December 31, 2022. You are
cautioned not to place undue reliance on such statements and to
consult our SEC filings for additional risks and uncertainties that
may apply to our business and the ownership of our securities. Our
forward-looking statements are presented as of the date made, and
we disclaim any duty to update such statements unless required by
law to do so.
Investor Relations Contact:
Three Part Advisors, LLCJoe Noyons
817.778.8424
Financial Tables Follow
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Quest Resource Holding Corporation and
Subsidiaries |
STATEMENTS OF OPERATIONS |
(In thousands, except per share amounts) |
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Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
(Unaudited) |
|
(Unaudited) |
Revenue |
|
$ |
74,497 |
|
|
$ |
76,905 |
|
|
$ |
148,611 |
|
|
$ |
148,427 |
|
Cost of revenue |
|
|
60,992 |
|
|
|
62,236 |
|
|
|
122,476 |
|
|
|
122,510 |
|
Gross profit |
|
|
13,505 |
|
|
|
14,669 |
|
|
|
26,135 |
|
|
|
25,917 |
|
Selling, general, and administrative |
|
|
9,213 |
|
|
|
9,299 |
|
|
|
18,630 |
|
|
|
18,643 |
|
Depreciation and amortization |
|
|
2,452 |
|
|
|
2,470 |
|
|
|
4,877 |
|
|
|
4,835 |
|
Total operating expenses |
|
|
11,665 |
|
|
|
11,769 |
|
|
|
23,507 |
|
|
|
23,478 |
|
Operating income |
|
|
1,840 |
|
|
|
2,900 |
|
|
|
2,628 |
|
|
|
2,439 |
|
Interest expense |
|
|
(2,556 |
) |
|
|
(1,590 |
) |
|
|
(4,999 |
) |
|
|
(3,146 |
) |
Income (loss) before
taxes |
|
|
(716 |
) |
|
|
1,310 |
|
|
|
(2,371 |
) |
|
|
(707 |
) |
Income tax expense |
|
|
171 |
|
|
|
160 |
|
|
|
540 |
|
|
|
327 |
|
Net income (loss) |
|
$ |
(887 |
) |
|
$ |
1,150 |
|
|
$ |
(2,911 |
) |
|
$ |
(1,034 |
) |
|
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Net income (loss) applicable
to common stockholders |
|
$ |
(887 |
) |
|
$ |
1,150 |
|
|
$ |
(2,911 |
) |
|
$ |
(1,034 |
) |
Net income (loss) per common
share: |
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Basic |
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$ |
(0.04 |
) |
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$ |
0.06 |
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$ |
(0.15 |
) |
|
$ |
(0.05 |
) |
Diluted |
|
$ |
(0.04 |
) |
|
$ |
0.05 |
|
|
$ |
(0.15 |
) |
|
$ |
(0.05 |
) |
|
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Weighted average number of
common shares outstanding: |
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Basic |
|
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19,962 |
|
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|
19,279 |
|
|
|
19,947 |
|
|
|
19,262 |
|
Diluted |
|
|
19,962 |
|
|
|
21,349 |
|
|
|
19,947 |
|
|
|
19,262 |
|
|
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED
EBITDA |
(Unaudited) |
(In thousands) |
|
|
|
Three Months Ended |
|
Six Months
Ended |
|
|
June 30, |
|
June 30, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Net income (loss) |
|
$ |
(887 |
) |
|
$ |
1,150 |
|
|
$ |
(2,911 |
) |
|
$ |
(1,034 |
) |
Depreciation and
amortization |
|
|
2,539 |
|
|
|
2,550 |
|
|
|
5,048 |
|
|
|
4,987 |
|
Interest expense |
|
|
2,556 |
|
|
|
1,590 |
|
|
|
4,999 |
|
|
|
3,146 |
|
Stock-based compensation
expense |
|
|
363 |
|
|
|
326 |
|
|
|
661 |
|
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|
585 |
|
Acquisition, integration, and
related costs |
|
|
174 |
|
|
|
668 |
|
|
|
652 |
|
|
|
1,974 |
|
Other adjustments |
|
|
117 |
|
|
|
113 |
|
|
|
31 |
|
|
|
309 |
|
Income tax expense |
|
|
171 |
|
|
|
160 |
|
|
|
540 |
|
|
|
327 |
|
Adjusted EBITDA |
|
$ |
5,033 |
|
|
$ |
6,557 |
|
|
$ |
9,020 |
|
|
$ |
10,294 |
|
|
ADJUSTED NET INCOME (LOSS) PER SHARE |
(Unaudited) |
(In thousands) |
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Reported net income (loss) (1) |
|
$ |
(887 |
) |
|
$ |
1,150 |
|
|
$ |
(2,911 |
) |
|
$ |
(1,034 |
) |
Amortization of intangibles
(2) |
|
|
2,223 |
|
|
|
2,221 |
|
|
|
4,444 |
|
|
|
4,396 |
|
Acquisition, integration, and
related costs (3) |
|
|
174 |
|
|
|
668 |
|
|
|
652 |
|
|
|
1,974 |
|
Other adjustments (4) |
|
|
— |
|
|
|
— |
|
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|
(76 |
) |
|
|
— |
|
Adjusted net income |
|
$ |
1,510 |
|
|
$ |
4,039 |
|
|
$ |
2,109 |
|
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$ |
5,336 |
|
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Diluted earnings per
share: |
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Reported net income
(loss) |
|
$ |
(0.04 |
) |
|
$ |
0.05 |
|
|
$ |
(0.15 |
) |
|
$ |
(0.05 |
) |
Adjusted net income |
|
$ |
0.07 |
|
|
$ |
0.19 |
|
|
$ |
0.10 |
|
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$ |
0.25 |
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Weighted average number of
common shares outstanding: Diluted (5) |
|
|
22,037 |
|
|
|
21,349 |
|
|
|
22,101 |
|
|
|
21,541 |
|
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(1) Applicable to common stockholders(2) Reflects the elimination
of non-cash amortization of acquisition-related intangible
assets(3) Reflects the add back of acquisition/integration related
transaction costs(4) Reflects adjustments to earn-out fair value(5)
Reflects adjustment for dilution when adjusted net income is
positive |
|
BALANCE SHEETS |
(In thousands, except per share amounts) |
|
|
|
June 30, |
|
December 31, |
|
|
2023 |
|
2022 |
|
|
(Unaudited) |
|
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ASSETS |
|
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Current assets: |
|
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Cash and cash equivalents |
|
$ |
2,980 |
|
|
$ |
9,564 |
|
Accounts receivable, less
allowance for doubtful accounts of $2,096and $2,176 as of June 30,
2023 and December 31, 2022, respectively |
|
|
45,477 |
|
|
|
45,891 |
|
Prepaid expenses and other
current assets |
|
|
3,153 |
|
|
|
2,310 |
|
Total current assets |
|
|
51,610 |
|
|
|
57,765 |
|
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Goodwill |
|
|
84,258 |
|
|
|
84,258 |
|
Intangible assets, net |
|
|
29,673 |
|
|
|
33,557 |
|
Property and equipment, net,
and other assets |
|
|
5,090 |
|
|
|
5,911 |
|
Total assets |
|
$ |
170,631 |
|
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$ |
181,491 |
|
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
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Current liabilities: |
|
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|
|
Accounts payable and accrued
liabilities |
|
$ |
36,609 |
|
|
$ |
32,207 |
|
Other current liabilities |
|
|
3,362 |
|
|
|
4,689 |
|
Current portion of notes
payable |
|
|
1,159 |
|
|
|
1,159 |
|
Total current liabilities |
|
|
41,130 |
|
|
|
38,055 |
|
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Notes payable, net |
|
|
58,867 |
|
|
|
70,573 |
|
Other long-term
liabilities |
|
|
1,522 |
|
|
|
1,724 |
|
Total liabilities |
|
|
101,519 |
|
|
|
110,352 |
|
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Commitments and
contingencies |
|
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Stockholders’ equity: |
|
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|
Preferred stock, $0.001 par
value, 10,000 shares authorized, no |
|
|
|
|
|
|
|
|
shares issued and outstanding as of June 30, 2023 and December 31,
2022 |
|
|
— |
|
|
|
— |
|
Common stock, $0.001 par
value, 200,000 shares authorized, |
|
|
|
|
|
|
|
|
19,782 and 19,696 shares issued and outstanding asof June 30, 2023
and December 31, 2022, respectively |
|
|
20 |
|
|
|
20 |
|
Additional paid-in capital |
|
|
174,759 |
|
|
|
173,876 |
|
Accumulated deficit |
|
|
(105,667 |
) |
|
|
(102,757 |
) |
Total stockholders’ equity |
|
|
69,112 |
|
|
|
71,139 |
|
Total liabilities and stockholders’ equity |
|
$ |
170,631 |
|
|
$ |
181,491 |
|
Quest Resource (NASDAQ:QRHC)
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De May 2024 a Jun 2024
Quest Resource (NASDAQ:QRHC)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024