Jeremy L. Dillon
RW Monitor
2/27/2015
US Ecology’s acquisition last year of the Environmental Quality Company has out-performed the company’s expectations, leading to a net income of $38.2 million for 2014, up from $32.2 million in 2013, US Ecology announced this week. Following the acquisition, the company saw a doubling of its total revenue, from $201.1 million in 2013 to $447.4 million in 2014, of which EQ operations contributed $228.2 million. “Exceptional growth in treatment and disposal revenue coupled with margin expansion drove record operating income, earnings and Adjusted EBITDA in our legacy US Ecology business,” US Ecology Executive Vice President and Chief Financial Officer Eric Gerratt said in a statement. “The year also benefitted from stronger than normal seasonal strength in the acquired EQ operations after atypical weather conditions in the first half of 2014 which severely dampened results. These factors resulted in a significantly higher contribution from the acquired operations during our ownership period than originally projected.”
For the further quarter of 2014, US Ecology recorded a slight drop in net income from the same period in 2013–$8.7 million compared to $9.2 million. Total revenue for the quarter was $157.2 million, up from $59.4 million in the same quarter last year, but excluding EQ operations, the environmental services revenue decreased $4.6 million in the fourth quarter of 2014 compared to the same period last year due to a due to a 13 percent decrease in project-based Event Business, reflecting accelerated volume from remedial projects in the fourth quarter of 2013, the company said. “The acquired EQ business performed better than expected, fueled by strength in the environmental services group and higher quality revenue in the field and industrial services segment,” US Ecology CEO Jeff Feeler said. “Recurring Base Business for the legacy US Ecology business grew three percent in the fourth quarter of 2014 compared to the fourth quarter of 2013. While the legacy US Ecology Event Business did not match an unusually strong fourth quarter in 2013, this portion of our business again delivered solid results.”
Positive 2015 Upcoming, Company Predicts
For 2015’s outlook, US Ecology is predicting a positive year, Feeler said. “Moving into 2015, market conditions and demand for our significantly expanded services are both strong,” Feeler said. “Our Event Business pipeline continues to build as we gain visibility into the warmer weather clean-up season, and economic conditions appear to support mid-single digit growth in our Base Business.” The company is predicting for 2015 revenue of $585 to $620 million and adjusted EBITDA of $137 to $143 million.
