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Us Ecology, Inc. (ECOL) SEC Filing 10-Q Quarterly Report for the period ending Thursday, September 30, 2021

Us Ecology, Inc.

CIK: 1783400 Ticker: ECOL

EXHIBIT 99.1

US Ecology Announces Third Quarter 2021 Results

THIRD QUARTER HIGHLIGHTS COMPARED TO PRIOR YEAR:

  • Waste Solutions Base Business growth accelerates to 11% on strong underlying fundamentals
  • Waste Solutions Event Business declines 18% due to ongoing project deferments and service mix
  • Field Services segment revenue grows 5% despite difficult comparison to last year
  • Energy Waste recovery continues; revenue doubling and adjusted EBITDA margin improving to 34%
  • Total revenue increases 8% to $257.2 million
  • Net Income of $6.7 million, earnings per diluted share of $0.21
  • Adjusted EBITDA of $45.4 million
  • Adjusted free cash flow of $14.9 million

BOISE, Idaho, Nov. 05, 2021 (GLOBE NEWSWIRE) -- US Ecology, Inc. (NASDAQ-GS: ECOL) (“US Ecology” or “the Company”) today reported results for the third quarter ended September 30, 2021.

“We remain encouraged by the acceleration in our underlying business activity, seeing sequential improvement in both revenue and profitability in the third quarter despite continued supply chain and pandemic-related challenges,” commented Chairman and Chief Executive Officer, Jeff Feeler. “Our Base Business generated double-digit revenue growth, driven by continued improvement in fundamentals and landfill volumes increasing approximately 13% compared to the third quarter last year. In terms of profitability, we are pleased that margins improved sequentially across all three of our operating segments despite ongoing delays in our Event Business, a less favorable service mix and cost inflation seen in the Waste Solutions segment.   

Our Field Services segment saw continued revenue growth over strong performance in the third quarter last year, even with much lower COVID decontamination work and absent a large scale Emergency Response project. Meanwhile, margin compression in Field Services resulted from a less favorable service mix, labor constraints and cost inflation for both materials and transportation.

Higher activity levels and the continued recovery of our Energy Waste segment delivered strong growth, with revenue doubling to over $10 million from a year ago and adjusted EBITDA margin increasing to 34%."  

Feeler continued, “The trends we are seeing support the clear business recovery underway. We are confident the successful execution of our strategic priorities will drive stronger results in 2022 and beyond. I am proud of the hard work and dedication of our talented team, and we remain committed to driving our strategy, bringing down our leverage and building long-term growth and shareholder value.”

THIRD QUARTER 2021 RESULTS

Revenue was $257.2 million in the third quarter of 2021, up 8% compared to $238.1 million in the third quarter of 2020.

Revenue for the Waste Solutions segment was $115.2 million, up 7% from $107.2 million in the third quarter of 2020. The increase was driven by an 11% increase in Base Business and a 25% increase in transportation revenue, partially offset by a 18% decline in Event Business compared to the same period in 2020.

Revenue for the Field Services segment was $131.6 million, up 5% from $125.7 million in the third quarter of 2020, primarily driven by increases in our Remediation, Small Quantity Generation and Industrial Services service lines partially offset by lower revenues from our Emergency Response and Transportation and Logistics service lines.

Revenue for the Energy Waste segment was $10.4 million compared to $5.2 million in the third quarter of 2020 driven by recovering oil demand and higher rig counts.

Net income was $6.7 million, or $0.21 per diluted share, compared to a net income of $6.3 million, or $0.20 per diluted share, in the third quarter of 2020. Adjusted earnings per diluted share was $0.22 and compares to adjusted earnings per diluted share of $0.25 in the third quarter of 2020.

Cash earnings per diluted share was $0.42 compared to $0.46 for the third quarter of 2020. Adjusted EBITDA was $45.4 million, consistent with the third quarter of 2020.

YEAR-TO-DATE RESULTS

Revenue for the first nine months of 2021 grew 5% to $726.6 million compared to $692.8 million in the first nine months of 2020.

Net income was $1.8 million, or $0.06 per diluted share, in the first nine months of 2021 compared to a net loss of $297.0 million, or $9.54 per diluted share, in the first nine months of 2020. Adjusted earnings per diluted share was $0.04 for the first nine months of 2021 compared to adjusted earnings per diluted share of $0.29 for the first nine months of 2020.

Cash earnings per diluted share was $0.65 for the first nine months of 2021 compared to $0.93 for the first nine months of 2020.

Adjusted free cash flow was $40.1 million for the first nine months of 2021 compared to $51.5 million in the first nine months of 2020.

Definitions and reconciliations of net income (loss) to adjusted EBITDA, earnings (loss) per diluted share to adjusted earnings per diluted share, earnings (loss) per diluted share to cash earnings per diluted share, and net cash provided by operating activities to adjusted free cash flow are attached as Exhibit A to this release.

2021 BUSINESS OUTLOOK

“Despite significant improvement in fundamentals relative to 2020, the industrial sector, as measured by industrial production, is still operating below pre-pandemic levels. We continue to navigate its varying impacts on supply chain, transportation and logistics and labor, which continues to constrain waste flows and service opportunities. This has created headwinds to growth, increased our cost structure through inflation and resulted in further Event Business delays that are pushing additional volumes into 2022.

Even with these short term challenges, the positive trends across our segments combined with the strengthening of our Event Business pipeline are expected to drive growth next year. Our competitive position remains as strong as ever, and we continue to leverage our network of facilities and service offerings to win business and position US Ecology for the future,” commented Feeler.

The Company now expects revenue for the full year in 2021 to be between $960 million and $990 million compared to the previous range of $940 million to $990 million, adjusted EBITDA to be between $158 million and $167 million compared to the previous range of $165 million to $175 million and adjusted earnings per diluted share to be between $0.22 to $0.41 compared to the previous guidance range of $0.37 to $0.60. Adjusted free cashflow is expected to be between $42 million and $54 million compared to the previous range of $42 million and $57 million.

The Company’s revised 2021 business outlook is summarized in the table below:

(in millions, except per share data)        
         
  Waste Solutions Field Services Energy Waste Total Company
Revenue $433 - $445 $494 - $510 $33 - $35 $960 - $990
Adjusted EBITDA $171 - $176 $75 - $79 $9 - $10 $158 - $167
Adjusted earnings per diluted share n/a n/a n/a $0.22 - $0.41
Cash earnings per share n/a n/a n/a $0.95 - $1.14
Adjusted free cashflow n/a n/a n/a $42 - $54
Capital Expenditures n/a n/a n/a $75 - $80
         

The following table reconciles projected net income to projected adjusted EBITDA guidance range:

  For the Year Ending
December 31, 2021
(in thousands) Low High
     
Projected Net Income $7,413  $13,476 
Income tax expense  4,079   7,016 
Interest expense, net  27,486   27,486 
Foreign currency loss (gain)  385   385 
Other income  (4,099)  (4,099)
Depreciation and amortization of plant and equipment  72,311   72,311 
Amortization of intangible assets  34,947   34,947 
Accretion and non-cash adjustments of closure & post-closure obligations  5,054   5,054 
Business development and integration expenses  2,812   2,812 
Share-based compensation  7,612   7,612 
Projected Adjusted EBITDA $158,000  $167,000 
         

The following table reconciles projected earnings per diluted share to projected adjusted earnings per diluted share and to projected cash earnings per diluted share:

  For the Year Ending
December 31, 2021
  Low High
     
Projected earnings per diluted share $0.24  $0.43 
     
Adjustments:    
Plus: Business development and integration expenses  0.06   0.06 
Less: Gain on minority interest investment  (0.08)  (0.08)
Foreign currency loss (gain)  -   - 
     
Projected adjusted earnings per diluted share $ 0.22   $ 0.41  
     
Plus: projected amortization of Intangible assets  0.73   0.73 
     
Projected cash earnings per diluted share $ 0.95   $ 1.14  
     
Shares used in earnings per diluted share calculation (in thousands)  31,385   31,385 
         

The following table reconciles projected net cash provided by operating activities to projected adjusted free cash flow:

 Year Ended December 31, 2021
(in thousands)Low End of Guidance High End of Guidance
Projected net cash provided by operating activities$ 113,255   $ 120,255  
Less: Purchases of property and equipment$(80,000) $(75,000)
Plus: Business development and integration expenses, net of tax$2,041  $2,041 
Plus: Purchases of property and equipment for the Idaho facility rebuild$1,719  $1,719 
Plus: Payment of deferred/contingent purchase consideration$2,553  $2,553 
Plus: proceeds from sale of equipment$2,432  $2,432 
    
Projected Adjusted Free Cash Flow$ 42,000   $ 54,000  
        

Adjusted EBITDA and adjusted earnings per diluted share guidance exclude gains on minority interest investments, business development and integration expenses and foreign currency translation gains or losses.

CONFERENCE CALL

US Ecology, Inc. will hold an investor conference call on Friday, November 5, 2021 at 11:00 a.m. Eastern Daylight Time (9:00 a.m. Mountain Daylight Time) to discuss these results and its current financial position and business outlook. Questions will be invited after management’s presentation. Interested parties can access the conference call by dialing 877-512-4138 or 412-317-5478. The conference call will also be broadcast live on the Company’s website at www.usecology.com. An audio replay will be available through November 12, 2021 by calling 877-344-7529 or 412-317-0088 and using the passcode 10160909. The replay will also be accessible on the US Ecology website at www.usecology.com.

ABOUT US ECOLOGY, INC.

US Ecology, Inc. is a leading provider of environmental services to commercial and government entities. The company addresses the complex waste management and response needs of its customers offering treatment, disposal, beneficial re-use, and recycling of hazardous, non-hazardous, radioactive and other specialty waste. US Ecology also provides a variety of vertically integrated field services including logistics and response at its customers in-field locations and through its network of 10-day transfer facilities. Logistics solutions include specialty waste packaging, collection lab pack, transportation, and total waste management. Response solutions include emergency response, oil spill response standby services, spill clean-up services, remediation, and industrial services. US Ecology’s focus on safety, environmental compliance, and best-in-class customer service enables us to effectively meet the needs of US Ecology’s customers and to build long lasting relationships. US Ecology has been protecting the environment since 1952. For more information, visit www.usecology.com.

Forward looking statements are only predictions and are not guarantees of performance. These statements are based on management’s beliefs and assumptions, which in turn are based on currently available information. Important assumptions include, among others, those regarding demand for the Company’s services, expansion of service offerings geographically or through new or expanded service lines, the timing and cost of planned capital expenditures, competitive conditions, and general economic conditions. These assumptions could prove inaccurate. Forward looking statements also involve known and unknown risks and uncertainties, which could cause actual results to differ materially from those contained in any forward-looking statement. Many of these factors are beyond our ability to control or predict. Such factors include developments related to the COVID-19 pandemic, fluctuations in commodity markets related to our business, the loss or failure to renew significant contracts, competition in our markets, adverse economic conditions, our compliance with applicable laws and regulations, potential liability in connection with providing oil spill response services and waste disposal services, the effect of existing or future laws and regulations related to greenhouse gases and climate change, the effect of our failure to comply with U.S. or foreign anti-bribery laws, the effect of compliance with laws and regulations, an accident at one of our facilities, incidents arising out of the handling of dangerous substances, our failure to maintain an acceptable safety record, our ability to perform under required contracts, limitations on our available cash flow as a result of our indebtedness, liabilities arising from our participation in multi-employer pension plans, the effect of changes in the method of determining the London Interbank Offered Rate or the replacement thereto, risks associated with our international operations, the impact of changes to U.S. tariff and import and export regulations, a change in our classification as an Oil Spill Removal Organization, cyber security threats, unanticipated changes in tax rules and regulations, loss of key personnel, a deterioration in our labor relations or labor disputes, our reliance on contractors to provide emergency response services, our access to insurance, surety bonds and other financial assurances, our litigation risk not covered by insurance, the replacement of non-recurring event projects, our ability to permit and contract for timely construction of new or expanded disposal space, renewals of our operating permits or lease agreements with regulatory bodies, our access to cost-effective transportation services, lawsuits, our implementation of new technologies, fluctuations in foreign currency markets and foreign affairs, our integration of acquired businesses, our ability to pay dividends or repurchase stock, anti-takeover regulations, stock market volatility, the failure of the warrants to be in the money or their expiration worthless and risks related to our compliance with maritime regulations (including the Jones Act).

Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the Securities and Exchange Commission, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on our forward-looking statements. Although we believe that the expectations reflected in forward looking statements are reasonable, we cannot guarantee future results or performance.

 
US ECOLOGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
         
  Three Months Ended
September 30,
 Nine Months Ended
September 30,
   2021   2020   2021   2020 
Revenue        
Waste Solutions $115,201  $107,249  $327,708  $319,684 
Field Services  131,582   125,715   374,491   343,217 
Energy Waste  10,399   5,178   24,375   29,879 
         
Total  257,182   238,142   726,574   692,780 
         
Gross profit (loss)        
Waste Solutions  39,548   41,518   110,165   123,042 
Field Services  22,164   24,938   58,549   57,973 
Energy Waste  1,442   (2,163)  1,866   737 
         
Total  63,154   64,293   170,580   181,752 
         
Selling, general & administrative expenses        
Waste Solutions  6,672   6,407   19,743   19,841 
Field Services  11,761   13,637   36,819   37,869 
Energy Waste  3,301   3,277   9,975   13,457 
Corporate  25,949   27,819   83,683   82,044 
         
Total  47,683   51,140   150,220   153,211 
         
Goodwill and intangible asset impairment charges       
Field Services  -   -   -   16,700 
Energy Waste  -   -   -   283,600 
         
Operating income (loss)  15,471   13,153   20,360   (271,759)
         
Other income (expense):        
Interest income  485   9   1,148   251 
Interest expense  (7,144)  (7,964)  (22,022)  (25,127)
Foreign currency gain (loss)  341   (421)  (385)  (155)
Other  114   86   4,020   382 
         
Total other expense  (6,204)  (8,290)  (17,239)  (24,649)
         
Income (loss) before income taxes  9,267   4,863   3,121   (296,408)
Income tax expense (benefit)  2,535   (1,456)  1,348   542 
         
Net income (loss) $6,732  $6,319  $1,773  $(296,950)
         
Earnings (loss) per share:        
Basic $0.22  $0.20  $0.06  $(9.54)
Diluted $0.21  $0.20  $0.06  $(9.54)
         
Shares used in earnings (loss)        
per share calculation:        
Basic  31,151   31,069   31,131   31,142 
Diluted  31,400   31,324   31,377   31,142 
         
Dividends paid per share $-  $-  $-  $0.18 


US ECOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
     
  September 30, 2021 December 31, 2020
Assets    
     
Current Assets:    
Cash and cash equivalents $71,432  $73,848 
Receivables, net  261,128   241,978 
Prepaid expenses and other current assets  31,799   28,379 
Income tax receivable  18,340   18,279 
Total current assets  382,699   362,484 
     
Property and equipment, net  450,720   456,637 
Operating lease assets  44,947   51,474 
Restricted cash and investments  3,758   5,598 
Intangible assets, net  497,636   523,988 
Goodwill  413,101   413,037 
Other assets  26,062   18,065 
Total assets $ 1,818,923  $ 1,831,283 
     
Liabilities and Stockholders’ Equity    
     
Current Liabilities:    
Accounts payable $66,402  $35,881 
Deferred revenue  17,475   15,267 
Accrued liabilities  51,750   59,296 
Accrued salaries and benefits  27,681   30,918 
Income tax payable  48   977 
Current portion of long-term debt  3,359   3,359 
Current portion of closure and post-closure obligations  8,234   6,471 
Current portion of operating lease liabilities  15,114   17,048 
Total current liabilities  190,063   169,217 
     
Long-term debt  753,965   782,484 
Long-term closure and post-closure obligations  90,107   89,398 
Long-term operating lease liabilities  30,739   35,069 
Other long-term liabilities  18,718   32,201 
Deferred income taxes, net  119,358   120,983 
Total liabilities  1,202,950   1,229,352 
     
Commitments and contingencies    
     
Stockholders’ Equity    
     
Common stock  315   315 
Additional paid-in capital  820,600   820,567 
Retained deficit  (186,679)  (188,452)
Treasury stock  (10,919)  (15,841)
Accumulated other comprehensive loss  (7,344)  (14,658)
Total stockholders’ equity  615,973   601,931 
Total liabilities and stockholders’ equity $ 1,818,923  $ 1,831,283 


US ECOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
  For the Nine Months
Ended September 30,
   2021   2020 
Cash Flows From Operating Activities:    
Net income (loss) $1,773  $(296,950)
Adjustments to reconcile net income (loss) to net cash provided by    
operating activities:    
Depreciation and amortization of property and equipment  54,095   54,831 
Amortization of intangible assets  26,501   27,812 
Accretion of closure and post-closure obligations  3,571   3,812 
Change in fair value of minority interest investment  (3,509)  - 
Unrealized foreign currency (gain) loss  (1,028)  87 
Deferred income taxes  (3,822)  79 
Share-based compensation expense  5,748   4,861 
Share-based payment of business development and integration expenses  417   1,142 
Unrecognized tax benefits  37   (8)
Net (gain) loss on disposition of assets  (337)  1,817 
Amortization of debt discount  121   121 
Amortization of debt issuance costs  1,851   1,640 
Goodwill impairment charges  -   300,300 
Change in fair value of contingent consideration  282   (3,207)
Changes in assets and liabilities (net of effects of business acquisitions):    
Receivables  (19,064)  25,297 
Income tax receivable  (70)  (6,250)
Other assets  (7,093)  (8,345)
Accounts payable and accrued liabilities  20,666   (19,177)
Deferred revenue  2,185   930 
Accrued salaries and benefits  (3,239)  (4,494)
Income tax payable  (943)  287 
Closure and post-closure obligations  (1,101)  (1,341)
Net cash provided by operating activities   77,041   83,244 
     
Cash Flows From Investing Activities:    
Purchases of property and equipment  (45,347)  (45,124)
Proceeds from sale of property and equipment  2,431   1,079 
Proceeds from sale of restricted investments  3,192   970 
Purchases of restricted investments  (1,014)  (1,113)
Minority interest investment  (712)  - 
Insurance proceeds from damaged property and equipment  -   1,131 
Business acquisitions, net of cash acquired  -   (3,309)
Net cash used in investing activities   (41,450)  (46,366)
     
Cash Flows From Financing Activities:    
Proceeds from short-term borrowings  61,326   72,353 
Payments on short-term borrowings  (61,326)  (72,353)
Payments on long-term debt  (29,375)  (33,375)
Payment of equipment financing obligations  (4,344)  (4,827)
Payment of contingent consideration liabilities  (2,553)  (2,085)
Deferred financing costs paid  (957)  (1,144)
Repurchases of common stock  (465)  (18,332)
Proceeds from long-term debt  -   90,000 
Dividends paid  -   (5,667)
Other  -   28 
Net cash (used in) provided by financing activities   (37,694)  24,598 
     
Effect of foreign exchange rate changes on cash  26   (480)
     
(Decrease) increase in cash and cash equivalents and restricted cash  (2,077)  60,996 
     
Cash and cash equivalents and restricted cash at beginning of period  75,104   42,140 
     
Cash and cash equivalents and restricted cash at end of period $73,027  $103,136 
         

EXHIBIT A
Non-GAAP Results and Reconciliations

US Ecology reports adjusted EBITDA, adjusted earnings (loss) per diluted share, cash earnings per diluted share results and adjusted free cash flow, which are non-GAAP financial measures, as a complement to results provided in accordance with generally accepted accounting principles in the United States (“GAAP”) and believes that such information provides analysts, stockholders, and other users information to better understand the Company’s operating performance. Because adjusted EBITDA, adjusted earnings (loss) per diluted share and adjusted free cash flow are not measurements determined in accordance with GAAP and are thus susceptible to varying calculations they may not be comparable to similar measures used by other companies. Items excluded from adjusted EBITDA, adjusted earnings (loss) per diluted share and adjusted free cash flow are significant components in understanding and assessing financial performance.

Adjusted EBITDA, adjusted earnings (loss) per diluted share, cash earnings per diluted share and adjusted free cash flow should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Adjusted EBITDA, adjusted earnings (loss) per diluted share and adjusted free cash flow have limitations as analytical tools and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

  • Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
  • Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;
  • Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;
  • Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;
  • Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and adjusted EBITDA does not reflect cash requirements for such replacements;
  • Adjusted EBITDA does not reflect our business development and integration expenses, which may vary significantly quarter to quarter;

Adjusted EBITDA

The Company defines adjusted EBITDA as net income before interest expense, interest income, income tax expense/benefit, depreciation, amortization, share-based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, non-cash impairment charges, business development and integration expenses and other income/expense.

The following reconciliation itemizes the differences between reported net income (loss) and adjusted EBITDA for the three and nine months ended September 30, 2021 and 2020:

(in thousands) Three Months Ended
September 30,
 Nine Months Ended
September 30,
   2021   2020   2021   2020 
         
Net income (loss) $6,732  $6,319  $1,773  $(296,950)
Income tax expense (benefit)  2,535   (1,456)  1,348   542 
Interest expense  7,144   7,964   22,022   25,127 
Interest income  (485)  (9)  (1,148)  (251)
Foreign currency (gain) loss  (341)  421   385   155 
Other income  (114)  (86)  (4,020)  (382)
Goodwill impairment charges  -   -   -   300,300 
Depreciation and amortization of plant and equipment  17,898   18,435   54,095   54,831 
Amortization of intangible assets  8,586   9,178   26,501   27,812 
Share-based compensation  1,713   1,773   5,748   4,861 
Accretion and non-cash adjustments of closure & post-closure obligations  1,198   1,279   3,571   3,812 
Business development and integration expenses  523   1,627   2,528   7,507 
Adjusted EBITDA $45,389  $45,445  $112,803  $127,364 
         

Adjusted Earnings Per Diluted Share

The Company defines adjusted earnings per diluted share as net income (loss) adjusted for the after-tax impact of the gain on a minority interest investment, the after-tax impact of business development and integration costs, the after-tax impact of non-cash goodwill impairment charges, and non-cash foreign currency translation gains or losses, divided by the number of diluted shares used in the earnings (loss) per diluted share calculation.

The gain on a minority interest investment excluded from the earnings (loss) per diluted share calculation represents an increase in the fair value of our investment based on a recent observable transaction in the equity of the entity. Impairment charges excluded from the earnings (loss) per diluted share calculation are related to the Company’s assessment of goodwill associated with its Energy Waste and international businesses. Business development and integration costs excluded from the earnings (loss) per diluted share calculation relate to expenses incurred to evaluate businesses for potential acquisition or costs related to closing and integrating successfully acquired businesses and transaction expenses. The foreign currency translation gains or losses excluded from the earnings (loss) per diluted share calculation are related to intercompany loans between our Canadian subsidiaries and the U.S. parent which have been established as part of our tax and treasury management strategy. These intercompany loans are payable in Canadian dollars (“CAD”) requiring us to revalue the outstanding loan balance through our consolidated income statement based on the CAD/United States currency movements from period to period.

We believe excluding the gain on minority interest investment, business development and integration costs, non-cash impairment charges, and non-cash foreign currency translation gains or losses from the earnings (loss) per diluted share calculation provides meaningful information to investors regarding the operational and financial performance of the Company.

Cash Earnings Per Diluted Share

The Company defines cash earnings per diluted share as adjusted earnings per diluted share (see definition above) plus amortization of intangible assets, net of tax.

The following reconciliation itemizes the differences between reported net income (loss) and earnings (loss) per diluted share to adjusted net income and adjusted earnings per diluted share and cash earnings per diluted share for the three and nine months ended September 30, 2021 and 2020:

(in thousands, except per share data)Three Months Ended September 30,
  2021   2020 
 Income (loss) before income taxesIncome tax benefit (expense)Net income (loss)per share Income (loss) before income taxesIncome tax benefit (expense)Net income (loss)per share
As Reported$9,267 $(2,535)$6,732 $0.21  $4,863 $1,456 $6,319 $0.20 
          
Adjustments:         
Plus: Business development and integration expenses 523  (144) 379  0.01   1,627  (447) 1,180  0.04 
Foreign currency (gain) loss (341) 94  (247) -   421  (116) 305  0.01 
          
As Adjusted$9,449 $(2,585)$6,864 $0.22  $6,911 $893 $7,804 $0.25 
          
Plus: Amortization of intangible assets$8,586 $(2,367) 6,219  0.20  $9,178 $(2,529) 6,649  0.21 
          
Cash earnings per diluted share$18,035 $(4,952)$13,083 $0.42  $16,089 $(1,636)$14,453 $0.46 
          
Shares used in earnings per diluted share calculation   31,400      31,324  
          
          
          
(in thousands, except per share data)Nine Months Ended September 30,
  2021   2020 
 Income (loss) before income taxesIncome tax benefit (expense)Net income (loss)per share (Loss) income before income taxesIncome tax benefit (expense)Net (loss) incomeper share
As Reported$3,121 $(1,348)$1,773 $0.06  $(296,408)$(542)$(296,950)$(9.54)
          
Adjustments:         
Less: Gain on minority interest investment (3,509) 965  (2,544) (0.08)  -  -  -  - 
Plus: Goodwill impairment charges -  -  -  -   300,300  -  300,300  9.64 
Plus: Business development and integration expenses 2,528  (695) 1,833  0.06   7,507  (2,064) 5,443  0.18 
Foreign currency loss 385  (106) 279  -   155  (43) 112  0.01 
          
As Adjusted$2,525 $(1,184)$1,341 $0.04  $11,554 $(2,649)$8,905 $0.29 
          
Plus: Amortization of intangible assets$26,501 $(7,296) 19,205  0.61  $27,812 $(7,716) 20,096  0.64 
          
Cash earnings per diluted share$29,026 $(8,480)$20,546 $0.65  $39,366 $(10,365)$29,001 $0.93 
          
Shares used in earnings (loss) per diluted share calculation   31,377      31,142  
              

Adjusted Free Cash Flow

The Company defines adjusted free cash flow as net cash provided by operating activities less purchases of property plant and equipment, plus business development and integration expenses, plus payments of deferred/contingent purchase consideration, plus purchases of property and equipment for the Grand View, Idaho facility rebuild, plus proceeds from sale of property and equipment.

The following reconciliation itemizes the differences between reported net cash from operating activities to adjusted free cash flow for the three and nine months ended September 30, 2021 and 2020:

 Three Months Ended
September 30,
 Nine Months Ended
September 30,
(in thousands) 2021   2020   2021   2020 
Adjusted Free Cash Flow Reconciliation       
Net cash provided by operating activities$ 32,967  $ 23,718  $ 77,041  $ 83,244 
Less: Purchases of property and equipment (18,916)  (9,167)  (45,347)  (45,124)
Plus: Business development and integration expenses, net of tax 379   1,180   1,833   5,443 
Plus: Purchases of property and equipment for the Idaho facility rebuild -   825   1,636   2,815 
Plus: Payment of deferred/contingent purchase consideration -   -   2,553   4,000 
Plus: Proceeds from sale of property and equipment 432   291   2,431   1,079 
        
Adjusted Free Cash Flow$ 14,862  $ 16,847  $ 40,147  $ 51,457 
                

Contact:
Alison Ziegler
Darrow Associates
(201)220-2678
aziegler@darrowir.com
www.usecology.com


The following information was filed by Us Ecology, Inc. (ECOL) on Friday, November 5, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Ticker: ECOL
CIK: 1783400
Form Type: 10-Q Quarterly Report
Accession Number: 0001558370-21-014794
Submitted to the SEC: Fri Nov 05 2021 1:45:45 PM EST
Accepted by the SEC: Fri Nov 05 2021
Period: Thursday, September 30, 2021
Industry: Refuse Systems

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