CLEAN HARBORS INC

Previous wording

In addition to historical information, this Quarterly Report on Form 10-Q contains forward-looking statements, which are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “plans to,” “seeks,” “aims, “should,” “estimates,” “projects,” “may,” “will,” “likely,” “potential” or similar expressions. Such statements may include, but are not limited to, statements about our future financial and operating results, plans, strategy, objectives and goals, cost management initiatives, contingent liabilities, liquidity, business and market conditions, customer demand, acquisitions, growth opportunities, expectations and other statements that are not historical facts. Such statements are based upon the beliefs and expectations of our management as of the date of this report only and are subject to certain risks and uncertainties that could cause actual results, performance or achievements to differ materially, including, without limitation: operational and safety risks; risks relating to the failure of new or existing technologies; 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 our business; negative economic, industry or other developments, including market volatility or economic downturns; risks associated with our assumptions relating to expansion of our 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 we serve; 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 our identification and execution of strategic acquisitions and divestitures and their related liabilities; risks relating to the availability and sufficiency of our insurance coverage, self-insurance, surety bonds, letters of credit and other forms of financial assurance; changes in tax regulations and interpretations including the imposition of trade sanctions or tariffs; fluctuations in interest rates and foreign currency exchange rates; risks relating to our indebtedness and covenants in our debt agreements; risks associated with certain anti-takeover provisions Massachusetts Business Corporation Act and our By-Laws; and those items identified as “Risk Factors” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 19, 2025, and in other documents we file from time to time with the SEC. Forward-looking statements are neither historical facts nor assurances of futu…

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Current wording

In addition to historical information, this Quarterly Report on Form 10-Q contains forward-looking statements, which are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “plans to,” “seeks,” “aims,” “will,” “should,” “estimates,” “projects,” “may,” “likely,” “potential” or similar expressions. Such statements may include, but are not limited to, statements about our future financial and operating results, plans, strategy, objectives and goals, cost management initiatives, pricing and productivity initiatives, contingent liabilities, liquidity, business, economic and market conditions, trends, customer demand, impacts of tariffs and new legislation, acquisitions, capital spending, growth opportunities, expectations, challenges and other statements that are not historical facts. Such statements are based upon the beliefs and expectations of our management as of the date of this report only and are subject to certain risks and uncertainties that could cause actual results, performance or achievements to differ materially, including, without limitation: operational and safety risks; risks relating to the failure of new or existing technologies; 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 our business; negative economic, industry or other developments, including market volatility or economic downturns; risks associated with our assumptions relating to expansion of our 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 we serve; 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 our identification and execution of strategic acquisitions and divestitures and their related liabilities; risks relating to the availability and sufficiency of our insurance coverage, self-insurance, surety bonds, letters of credit and other forms of financial assurance; 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 our indebtedness and covenants in our debt agreements; risks associated with certain anti-takeover provisions under the Massachusetts Business Corporation Act and our By-Laws; and those items discussed elsewhere in this report or identified as “Risk Factors” in our Annual Report on Form 10-K filed with the Securit…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

•Safety-Kleen Sustainability Solutions -Safety-Kleen Sustainability Solutions (“SKSS”) segment results are impacted by our customers’ demand for high-quality, environmentally responsible recycled oil products and their demand for our related service and product offerings. SKSS offers high-quality recycled base and blended oil products and other automotive and industrial lubricants to end users including fleet customers, distributors, manufacturers of oil products and industrial plants. Segment results are impacted by market pricing, overall demand and the mix of our oil products sales. Segment results are also predicated on the demand for other SKSS product and service offerings including collection services for used oil, used oil filters and other automotive fluids. The used oil collected is used as feedstock in our oil re-refining to produce our base and blended oil products and other hydraulic oils, lubricants and recycled fuel oil or are integrated into our recycling and disposal network. The results and integration of the acquired operations of Noble also impact the overall segment results. In operating the business and evaluating performance, management tracks the volumes and relative percentages of base and blended oil sales along with various pricing metrics associated with the commodity driven margin between product pricing and the overall revenue generation and costs associated with the collection of used oil. Levels of activity and ultimate performance associated with this segment can be impacted by economic conditions in the manufacturing and automotive services markets, efficiency of our operations, technology, weather conditions, changing regulations, competition and the management of our related operating costs. Overall product pricing as well as revenues generated and/or costs incurred in connection with the collection of used oil and other raw materials associated with the segment’s oil related products can also be volatile and can be impacted by global events and their relative impact on commodity products and pricing. The overall market price of oil and regulations that change the possible usage of used oil or burning of used oil as a fuel, impact the premium the segment can charge for used oil collections.

Current wording

•Safety-Kleen Sustainability Solutions -The Safety-Kleen Sustainability Solutions (“SKSS”) segment results are impacted by our customers’ demand for high-quality, environmentally responsible recycled oil products and their demand for our related service and product offerings. SKSS offers high-quality recycled base and blended oil products and other automotive and industrial lubricants to end users including fleet customers, distributors, manufacturers of oil products and industrial plants. Segment results are impacted by market pricing, overall demand and the mix of our oil products sales. Segment results are also predicated on the demand for other SKSS product and service offerings including collection services for used oil, used oil filters and other automotive fluids. The used oil collected is used as feedstock in our oil re-refining to produce our base and blended oil products and other hydraulic oils, lubricants and recycled fuel oil or are integrated into our recycling and disposal network. The results and integration of the acquired operations of Noble also impact the overall segment results. In operating the business and evaluating performance, management tracks the volumes and relative percentages of base and blended oil sales along with various pricing metrics associated with the commodity driven margin between product pricing and the overall revenue generation and costs associated with the collection of used oil. Levels of activity and ultimate performance associated with this segment can be impacted by economic conditions in the manufacturing and automotive services markets, efficiency of our operations, technology, weather conditions, changing regulations, competition and the management of our related operating costs. Overall product pricing as well as revenues generated and/or costs incurred in connection with the collection of used oil and other raw materials associated with the segment’s oil related products can also be volatile and can be impacted by global events and their relative impact on commodity products and pricing. The overall market price of oil and regulations that change the possible usage of used oil or burning of used oil as a fuel, impact the premium the segment can charge for used oil collections.

Previous wording

Total direct revenues for the three months ended March 31, 2025 were $1,432.0 million, compared with $1,376.7 million for the three months ended March 31, 2024. Our Environmental Services segment direct revenues increased $36.6 million or 3.1% for the three months ended March 31, 2025 from the comparable period in 2024 driven by growth in Field and Emergency Response Services, specifically incremental contributions from the acquisition of HEPACO, as well as growth in our Technical Services and Safety-Kleen core service offerings, offset by contraction of Industrial Services revenues. For the three months ended March 31, 2025, our SKSS segment direct revenues increased $18.7 million or 9.1% from the comparable period in 2024, driven by the contributions of Noble as well as growth in charge for oil revenue, which was partially offset by lower sales of blended and base oil. Foreign currency translation of our Canadian operations negatively impacted our consolidated direct revenues by $8.2 million in the three months ended March 31, 2025 compared to the same period in 2024.

Current wording

Total direct revenues for the three and six months ended June 30, 2025 were $1,549.9 million and $2,981.8 million, compared with $1,552.7 million and $2,929.4 million for the three and six months ended June 30, 2024, respectively. For the three months ended June 30, 2025, our Environmental Services segment direct revenues increased $42.7 million or 3.3% from the comparable period in 2024, driven by strong growth in Safety-Kleen core services and Technical Services, offset by fewer large scale emergency response events for our Field and Emergency Response Services operations. For the six months ended June 30, 2025, our Environmental Services segment direct revenues increased $79.3 million or 3.2% from the comparable period in 2024, driven by growth in Field and Emergency Response Services, specifically incremental contributions from the acquisition of HEPACO, as well as growth in our Technical Services and Safety-Kleen core services, offset by lower contributions from the Industrial Services organization. For the three and six months ended June 30, 2025, our SKSS segment direct revenues decreased $45.5 million and $26.9 million or 18.7% and 6.0%, respectively, from the comparable periods in 2024, driven by lower sales of base and blended oil products. These decreases were partially offset by higher charge for oil revenue and incremental contributions from Noble. Foreign currency translation of our Canadian operations negatively impacted our consolidated direct revenues by $1.8 million and $10.0 million in the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024.

Previous wording

Income from operations for the three months ended March 31, 2025 was $111.6 million, compared with $125.5 million in the three months ended March 31, 2024, representing a decrease of 11.0%, primarily driven by an increase in depreciation and amortization expense as a result of the incremental assets from the acquisitions of HEPACO and Noble, which occurred in the first quarter of 2024. Net income for the three months ended March 31, 2025 was $58.7 million, a decrease of $11.2 million, or 16.0% as compared with net income of $69.8 million in the three months ended March 31, 2024.

Current wording

Income from operations for the three and six months ended June 30, 2025 was $210.3 million and $321.9 million, compared with $215.5 million and $341.0 million in the three and six months ended June 30, 2024, representing decreases of 2.4% and 5.6% respectively, primarily due to increased depreciation and amortization expense in 2025, as compared to the comparable periods in 2024. Net income for the three and six months ended June 30, 2025 was $126.9 million and $185.6 million, decreases of $6.4 million and $17.5 million, or 4.8% and 8.6% as compared with net income of $133.3 million and $203.1 million in the three and six months ended June 30, 2024, respectively.

Previous wording

Adjusted EBITDA, which is the primary financial measure by which we evaluate the operating performance of our segments, increased $4.8 million or 2.1%, from $230.1 million in the three months ended March 31, 2024 to $234.9 million in the three months ended March 31, 2025. Additional information regarding Adjusted EBITDA, which is a non-GAAP measure, including a reconciliation of net income to Adjusted EBITDA, appears below under“Adjusted EBITDA.”

Current wording

Adjusted EBITDA, which is the primary financial measure by which we evaluate the operating performance of our segments, increased $8.4 million and $13.2 million or 2.6% and 2.4%, from $327.8 million and $557.9 million in the three and six months ended June 30, 2024 to $336.2 million and $571.1 million in the three and six months ended June 30, 2025. Additional information regarding Adjusted EBITDA, which is a non-GAAP measure, including a reconciliation of net income to Adjusted EBITDA, appears below under“Adjusted EBITDA.”

Previous wording

Net cash from operating activities for the three months ended March 31, 2025 decreased $16.9 million from $18.5 million in 2024 to $1.6 million in 2025 due to increased working capital balances as well as higher interest payments. As is typical for the first quarter, adjusted free cash flow, which management uses to measure our financial strength and ability to generate cash, was an outflow of $115.7 million in the three months ended March 31, 2025 as compared to an outflow of $118.4 million in the comparable period of 2024. Additional information regarding adjusted free cash flow, which is a non-GAAP measure, including a reconciliation of net cash from operating activities to adjusted free cash flow, appears below under“Adjusted Free Cash Flow.”

Current wording

Net cash from operating activities for the six months ended June 30, 2025 decreased $24.9 million from $234.6 million in 2024 to $209.6 million in 2025 primarily due to increased working capital balances. Adjusted free cash flow, which management uses to measure our financial strength and ability to generate cash, was an inflow of $17.4 million in the six months ended June 30, 2025 as compared to an outflow of $34.1 million in the comparable period of 2024, mainly due to lower cash paid for additions to property, plant and equipment. Additional information regarding adjusted free cash flow, which is a non-GAAP measure, including a reconciliation of net cash from operating activities to adjusted free cash flow, appears below under“Adjusted Free Cash Flow.”

Previous wording

(1)Direct revenues are revenues allocated to the segment performing the provided service.

Current wording

(1)Direct revenues are allocated to the segment performing the provided service or selling the product.

Previous wording

(2)Cost of revenues is shown exclusive of (i) accretion of environmental liabilities and (ii) depreciation and amortization which are presented separately on the consolidated statements of operations.

Current wording

(2)Cost of revenues are shown exclusive of (i) accretion of environmental liabilities and (ii) depreciation and amortization which are presented separately on the Consolidated Statements of Operations.

Previous wording

(3)Selling, general and administrative expenses is shown exclusive of stock-based compensation which is presented in Selling, general and administrative expenses on the Company’s Consolidated Statements of Operations but is not included in the Company’s measurement of Adjusted EBITDA. See Adjusted EBITDA section below for a reconciliation of net income to Adjusted EBITDA.

Current wording

(3)Selling, general and administrative expenses are shown exclusive of stock-based compensation which is presented in Selling, general and administrative expenses on the Company’s Consolidated Statements of Operations but is not included in the Company’s measurement of Adjusted EBITDA. See Adjusted EBITDA section below for a reconciliation of net income to Adjusted EBITDA.

Previous wording

There are many factors which can impact our revenues including, but not limited to: overall levels of industrial activity and economic growth in North America, competitive industry pricing, overall market incineration capacity including captive incineration closures, changes in the regulatory environment including those related to per- and polyfluoroalkyl substances (“PFAS”), impacts of acquisitions and divestitures, the level of emergency response services, government infrastructure investment, reshoring of domestic manufacturing, existence or non-existence of large scale environmental waste and remediation projects, weather related events, the number of parts washers placed at customer sites, miles driven and related lubricant demand, base and blended oil pricing, market supply for base oil products, market changes relative to the collection of used oil and foreign currency translation. In addition, customer efforts to minimize hazardous waste and changes in regulation can impact our revenues.

Current wording

There are many factors which can impact our revenues including, but not limited to: overall levels of industrial activity and economic growth in North America, competitive industry pricing, overall market incineration capacity including captive incineration closures, changes in the regulatory environment including those related to per- and polyfluoroalkyl substances (“PFAS”), impacts of acquisitions and divestitures, the level of emergency response services, government infrastructure investment, reshoring of domestic manufacturing, existence or non-existence of large scale environmental waste and remediation projects, weather related events, the number of parts washers placed at customer sites, miles driven and related lubricant demand, base and blended oil pricing, market supply for base oil products, market changes relative to the collection of used oil and foreign currency fluctuations. In addition, customer efforts to minimize hazardous waste and changes in regulation can impact our revenues.

Previous wording

Environmental Services direct revenues for the three months ended March 31, 2025 increased $36.6 million from the comparable period in 2024 driven by incremental revenues from acquisitive growth and contributions from our legacy operations. Field and emergency response service revenues for the three months ended March 31, 2025 increased $52.2 million from the comparable period in 2024 driven by incremental revenue of approximately $50 million from the acquisition of HEPACO as well as overall growth in legacy field and emergency response service offerings. Technical services revenue increased $18.7 million largely due to higher incineration volumes coupled with improved pricing. On a comparative basis and excluding the impacts of the new incinerator in Kimball, Nebraska, which is not expected to be running at full utilization until 2026, utilization at our incinerators was 88% in the first three months of 2025 as compared to 79% in the same period in 2024. Including the new Kimball incinerator, utilization at our incinerators was 81% during the three months ended March 31, 2025. Revenues for Safety-Kleen core service offerings for the three months ended March 31, 2025 grew by $11.9 million from the comparable period in 2024 due to improved pricing for our containerized waste, vacuum and parts washer services despite fewer parts washer services compared to the same period in 2024. Revenue from our industrial services operations declined $37.0 million due to lower turnaround activity and related high-value services for the three months ended March 31, 2025 compared to the same period in 2024. Direct revenues for Canadian operations of the Environmental Services segment decreased by $6.5 million due to foreign currency translation.

Current wording

Environmental Services direct revenues for the six months ended June 30, 2025 increased $79.3 million from the comparable period in 2024 driven by acquisitive growth and incremental revenues from our legacy operations. Field and emergency response service revenues for the six months ended June 30, 2025 increased $42.1 million from the comparable period in 2024 driven by incremental revenue from the acquisition of HEPACO in late March 2024, partially offset by fewer large-scale emergency response events in the current year period. Technical services revenue increased $38.5 million from the comparable prior year period driven primarily by higher incineration volumes. On a comparative basis and excluding the impacts of the new incinerator in Kimball, Nebraska, utilization at our incinerators was 89% in the first six months of 2025 as compared to 83% in the same period in 2024. Including the new Kimball incinerator, utilization at our incinerators was 84% during the six months ended June 30, 2025. Revenues from Safety-Kleen core services for the six months ended June 30, 2025 grew by $32.9 million from the comparable period in 2024 due to improved pricing for our containerized waste, vacuum and parts washer services. Revenue from our industrial services operations declined $34.9 million due to lower turnaround activity and related high-value services, predominately early in 2025 when compared to 2024. Direct revenues for Canadian operations of the Environmental Services segment decreased by $8.0 million due to foreign currency translation.

Previous wording

In the three months ended March 31, 2025, SKSS direct revenues increased $18.7 million compared to the same period in 2024. This growth was mainly due to a $20.0 million increase in revenues from vacuum gas oil and specialty refinery products, driven by the acquisition of Noble, and a $5.9 million increase in revenues from the collection of used oil, attributed to higher pricing for these collection services and increased volumes collected. These increases were partially offset by a $5.9 million decline in base oil sales driven by lower pricing despite increased volumes sold and a $3.7 million decline in blended oil sales which was driven by lower volumes sold and, to a lesser extent, lower pricing. Direct revenues for Canadian operations of the SKSS segment decreased by $1.7 million due to foreign currency translation.

Current wording

In the six months ended June 30, 2025, SKSS direct revenues decreased $26.9 million compared to the same period in 2024. Revenues from the sale of base and blended oil products decreased $38.6 million and $19.2 million, respectively, resulting from lower volumes sold and, to a lesser extent, lower pricing, and revenues from contract packaging services decreased $10.3 million from the same period in 2024. These decreases were partially offset by a $19.3 million increase in revenues from vacuum gas oil and specialty refinery products, driven by the acquisition of Noble in March 2024, and a $16.7 million increase in revenue from the collection of used oil attributed to the higher pricing for these collection services noted above. Direct revenues for Canadian operations of the SKSS segment decreased by $1.9 million due to foreign currency translation.

Previous wording

Environmental Services cost of revenues for the three months ended March 31, 2025 increased $27.0 million from the comparable period in 2024, and remained relatively consistent as percentage of revenues. Commensurate with the revenue growth in the business and recent acquisitions discussed above, labor and benefit related costs increased $25.1 million and equipment and supply costs increased $6.5 million for the three months ended March 31, 2025 when compared to the three months ended March 31, 2024. The remaining increase was spread across various cost categories and was driven by acquisitions. Partially offsetting these cost increases were decreases in third-party labor costs of $7.9 million and external transportation, vehicle and fuel related costs of $2.1 million for the three months ended March 31, 2025 when compared to the three months ended March 31, 2024.

Current wording

Environmental Services cost of revenues for the three months ended June 30, 2025 increased $27.2 million from the comparable period in 2024, and remained consistent as a percentage of revenues. Commensurate with the revenue growth in the business, equipment and supply costs increased $9.1 million and labor and benefit related costs increased $8.9 million for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024. The remaining cost increase was spread across various cost categories. Partially offsetting these cost increases was a decrease of $4.3 million in third-party labor costs for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024 due to labor internalization efforts.

Previous wording

SKSS cost of revenues for the three months ended March 31, 2025 increased $22.6 million from the comparable period in 2024 and increased 3.8% as a percentage of revenues. The cost increase is primarily due to additional expenses from the Noble operations. As a percentage of revenues, these costs increased primarily due to the higher cost per gallon of base oil products sold, the overall mix of product sales and market related pricing decreases discussed in the revenue section during the three months ended March 31, 2025 as compared to the same period in the prior year.

Current wording

SKSS cost of revenues for the six months ended June 30, 2025 decreased $7.3 million from the comparable period in 2024 but increased 2.9% as a percentage of revenues. The overall cost decrease was driven by the lower sales volumes, discussed above, and by lower acquisition costs of used oil feedstock in the six months ended June 30, 2025 compared to the prior period. These decreases were partially offset by incremental expenses from the Noble acquisition. As a percentage of revenues, these costs increased primarily due to market-related volume and pricing decreases discussed above in the SKSS direct revenues section and the overall mix of products sold during the six months ended June 30, 2025 as compared to the same period in the prior year.

Previous wording

The SG&A balances as set forth below in this section exclude stock-based compensation expense, which is presented in SG&A on the Company’s Consolidated Statement of Operations but is not included in the Company’s measurement of Adjusted EBITDA. For a discussion of significant changes in consolidated stock-based compensation expense, please refer to the separate section below.

Current wording

The SG&A expenses set forth below exclude stock-based compensation expense, which is presented in SG&A on the Company’s Consolidated Statement of Operations but is not included in the Company’s measurement of Adjusted EBITDA. For a discussion of significant changes in consolidated stock-based compensation expense, please refer to the separate section below.

Previous wording

Environmental Services SG&A expenses for the three months ended March 31, 2025 remained relatively consistent with the comparable period in 2024, both in dollar amount and as a percentage of revenues. The current quarter results include the impact of reducing estimated costs to remediate a site by approximately $10 million to reflect our conclusion that a loss was no longer probable based on recent evaluation of available evidence. This benefit was partially offset by higher labor and benefits related costs of $7.9 million as a result of the HEPACO acquisition and other investments in our employees.

Current wording

Environmental Services SG&A expenses for the six months ended June 30, 2025 decreased $1.4 million from the comparable period in 2024, and remained relatively consistent as a percentage of revenues. The results for the six months ended June 30, 2025 include the impact of reducing the estimated costs to remediate a site by approximately $10 million in the first quarter of 2025 to reflect our conclusion that a loss was no longer probable based on recent evaluation of available evidence. This benefit was partially offset by higher labor and benefits related costs of $11.7 million as a result of the HEPACO acquisition and other investments in our employees.

Previous wording

For the three months ended March 31, 2025, SKSS SG&A expenses decreased $2.4 million and, as a percentage of revenues, decreased 1.9% when compared to the same period in the prior year. Labor and benefit related costs decreased $1.6 million in the three months ended March 31, 2025 when compared to the same period in 2024, mainly driven by cost reduction initiatives that were executed in the fourth quarter of 2024 and the shift to charging for the collection of used oil, which drove higher revenues.

Current wording

SKSS SG&A expenses for the three months ended June 30, 2025 decreased $2.5 million and, despite the revenue decreases noted above, remained relatively consistent, as a percentage of revenues, when compared to the same period in 2024. Labor and benefit related costs decreased $2.6 million in the three months ended June 30, 2025 when compared to the same period in 2024, mainly driven by cost reduction initiatives that were executed late in 2024 and strategic headcount management actions implemented early in the second quarter of 2025.

Previous wording

Depreciation and amortization for the three months ended March 31, 2025 increased by $16.9 million from the comparable period in 2024 due to the depreciation of fixed assets and amortization of intangible assets acquired from the March 2024 HEPACO and Noble acquisitions, depreciation for the Kimball incinerator which was placed in service in December 2024 and incremental finance lease amortization.

Current wording

Depreciation and amortization for the six months ended June 30, 2025 increased by $32.7 million from the comparable period in 2024 due to depreciation of fixed assets and amortization of intangible assets acquired from the March 2024 HEPACO and Noble acquisitions, depreciation for the Kimball incinerator, which was placed in service in December 2024, incremental depreciation for assets placed in service to support the growth of the business, higher amortization of landfill assets due to increased volumes and incremental finance lease amortization.

Previous wording

Interest expense, net of interest income for the three months ended March 31, 2025 increased $7.5 million from the comparable period in 2024 primarily due to higher levels of outstanding debt during the period. Interest expense was partially offset by a $2.1 million increase in interest income in the three months ended March 31, 2025 compared to the same period in 2024.

Current wording

Interest expense, net of interest income for the six months ended June 30, 2025 increased $8.2 million from the comparable period in 2024 primarily due to higher levels of outstanding debt during the period resulting from the issuance of incremental debt on March 22, 2024. Interest expense was partially offset by a $2.8 million increase in interest income in the six months ended June 30, 2025 compared to the same period in 2024.

Previous wording

As of March 31, 2025, the effective interest rate on our debt was 5.3%. For the remainder of 2025, we expect interest expense to remain relatively consistent with the prior year. For additional information regarding our current portfolio of long-term debt, see Note 11, “Financing Arrangements,” to the accompanying unaudited consolidated financial statements.

Current wording

As of June 30, 2025, the effective interest rate on our debt was 5.3%. For the remainder of 2025, we expect interest expense, net of interest income to remain relatively consistent with the prior year. For additional information regarding our current portfolio of long-term debt, see Note 11, “Financing Arrangements,” to the accompanying unaudited consolidated financial statements.

Previous wording

For the three months ended March 31, 2025, the provision for income taxes decreased $10.0 million as a result of lower pre-tax income compared to the same period in 2024. The reduction in our effective tax rate was driven by the write-off of a deferred tax asset with a full valuation allowance associated with the remedial liability change in estimate discussed above.

Current wording

For the six months ended June 30, 2025, the provision for income taxes decreased $9.9 million compared to the same period in 2024. This decrease was driven by both lower pre-tax income as well as a reduced effective tax rate in 2025. The decrease in our effective tax rate in the six months ended June 30, 2025 was driven by the write-off of a deferred tax asset with a full valuation allowance associated with the remedial liability change in estimate discussed above, which occurred in the first quarter of 2025.

Previous wording

Net cash from operating activities for the three months ended March 31, 2025 was $1.6 million as compared to $18.5 million in the same period of 2024. This $16.9 million decrease in operating cash flows was attributable to an increase in working capital balances for the three months ended March 31, 2025 as compared to the same period in 2024, as well as lower income from operations and higher cash paid for interest.

Current wording

Net cash from operating activities for the six months ended June 30, 2025 was $209.6 million as compared to $234.6 million in the same period of 2024. This $24.9 million decrease in operating cash flows was attributable to an increase in working capital balances for the six months ended June 30, 2025 compared to the same period in 2024, partially offset by lower cash payments for income taxes.

Previous wording

Net cash used in investing activities for the three months ended March 31, 2025 was $120.3 million, a decrease of $489.5 million from the comparable period in 2024. In the three months ended March 31, 2024, we paid $475.3 million for acquisitions, including the purchase of HEPACO and Noble. Additions to property, plant and equipment decreased $19.2 million, primarily due to notable project spend on the Baltimore, Maryland strategic project and the Kimball incinerator in the three months ended March 31, 2024.

Current wording

Net cash used in investing activities for the six months ended June 30, 2025 was $200.7 million, a decrease of $529.9 million from the comparable period in 2024. In the six months ended June 30, 2024, we paid $477.2 million for acquisitions, including the purchase of HEPACO and Noble. Additions to property, plant and equipment decreased $64.3 million, primarily due to notable project spend of $40.4 million on the Kimball incinerator strategic project in the six months ended June 30, 2024. Partially offsetting these lower cash outflows was an $11.7 million lower cash inflow due to the timing of transactions within our wholly owned captive insurance company.

Previous wording

Net cash used in financing activities for the three months ended March 31, 2025 was $79.3 million, as compared to net cash from financing activities of $486.0 million for the three months ended March 31, 2024. The primary drivers of this change were the incurrence of term loans net of discount and deferred financing costs of $494.7 million in 2024 to fund the acquisitions executed during the period. These amounts were partially offset by higher cash paid for repurchases of stock of $50.0 million, tax payments on withholdings of vested restricted stock of $5.6 million and finance lease payments of $5.4 million during 2025.

Current wording

Net cash used in financing activities for the six months ended June 30, 2025 was $101.2 million, as compared to net cash from financing activities of $455.5 million for the six months ended June 30, 2024. The primary difference in financing activities was the incurrence of term loans net of discount and deferred financing costs of $491.2 million in 2024 to fund the acquisitions executed during the period. Additionally, in 2025, the Company paid $56.8 million more for repurchases of common stock, $5.9 million for tax payments on withholdings of vested restricted stock and $5.3 million more in finance lease payments. Partially offsetting these incremental financing cash outflows in 2025 was the receipt of $3.4 million in proceeds from the ESPP.

Previous wording

Management considers adjusted free cash flow, a non-GAAP measure, to be a measure of liquidity which provides useful information to management, creditors and investors about our financial strength and our ability to generate cash. Additionally, adjusted free cash flow is a metric on which a portion of management incentive compensation is based. We define adjusted free cash flow as net cash from operating activities, less additions to property, plant and equipment plus proceeds from sales or disposals of fixed assets. When necessary, management adjusts for the cash impact of items derived from non-operating activities. Adjusted free cash flow should not be considered an alternative to net cash from operating activities or other measurements under GAAP. Adjusted free cash flow is not calculated identically by all companies, and therefore our measurements of adjusted free cash flow may not be comparable to similarly titled measures reported by other companies.

Current wording

Management considers adjusted free cash flow, a non-GAAP measure, to be a measure of liquidity which provides useful information to management, creditors and investors about our financial strength and our ability to generate cash. Additionally, adjusted free cash flow is a metric on which a portion of management incentive compensation is based. We define adjusted free cash flow as net cash from operating activities, less additions to property, plant and equipment, plus proceeds from sales or disposals of fixed assets. When necessary, management adjusts for the cash impact of items derived from non-operating activities. Additionally, adjusted free cash flow excludes significant one-time growth investments, as they are not indicative of free cash flow generation for the current period. For 2025, these significant one-time growth investments include the build out of a hub facility in Phoenix Arizona which is expected to cost approximately $15 million in 2025 and, from which we expect to realize future long-term benefits. Adjusted free cash flow should not be considered an alternative to net cash from operating activities or other measurements under GAAP. Adjusted free cash flow is not calculated identically by all companies, and therefore our measurements of adjusted free cash flow may not be comparable to similarly titled measures reported by other companies.

Previous wording

At March 31, 2025, cash and cash equivalents and marketable securities totaled $595.3 million, compared to $789.8 million at December 31, 2024. At March 31, 2025, cash and cash equivalents held by our Canadian subsidiaries totaled $96.9 million. The cash and cash equivalents and marketable securities balance for our U.S. operations was $498.4 million at March 31, 2025. Our U.S. operations had net operating cash inflows of $14.1 million for the three months ended March 31, 2025.

Current wording

At June 30, 2025, cash and cash equivalents and marketable securities totaled $699.1 million, compared to $789.8 million at December 31, 2024. At June 30, 2025, cash and cash equivalents held by our Canadian subsidiaries totaled $91.6 million. The cash and cash equivalents and marketable securities balance for our U.S. operations was $607.5 million at June 30, 2025. Our U.S. operations had net operating cash inflows of $223.1 million for the six months ended June 30, 2025.

Previous wording

We maintain a $600.0 million revolving credit facility of which, as of March 31, 2025, approximately $462.4 million, was available to borrow under the facility, with letters of credit of $137.6 million outstanding.

Current wording

We maintain a $600.0 million revolving credit facility of which, as of June 30, 2025, approximately $452.1 million was available to borrow under the facility, with letters of credit of $147.9 million outstanding.

Previous wording

Capital expenditures during the first three months of 2025 were $118.7 million as compared to $137.9 million during the first three months of 2024. The decrease was driven by incremental investments in our Baltimore, Maryland and Kimball incinerator facilities which occurred in 2024. We anticipate that 2025 capital spending, net of disposals, will be in the range of $360.0 million to $390.0 million. This includes a long-term growth investment of approximately $15 million for the Phoenix hub. We expect spending on this project to begin in the second quarter of 2025 with the purchase of the facility.

Current wording

Capital expenditures during the first six months of 2025 were $208.7 million as compared to $273.0 million during the first six months of 2024. Notable project spend in 2024 included investments of $40.4 million in our Kimball incinerator facility and $15.4 million in our Baltimore, Maryland facility. In 2025, notable project spend includes $12.4 million spent for the purchase of a building for our Phoenix hub project. The remaining decrease in capital expenditures in the six months ended June 30, 2025 as compared to June 30, 2024 is due to the timing of expenditures. Overall, we expect that 2025 capital spending, net of disposals, will be in the range of $360.0 million to $390.0 million including the long-term growth investment of approximately $15 million for the Phoenix hub.

Previous wording

We anticipate that the capital spending will be funded by cash from our operations. Unanticipated changes in environmental regulations could require us to make significant capital expenditures for our facilities and adversely affect our results of operations and cash flow.

Current wording

We anticipate that the remaining 2025 capital spending will be funded by cash from our operations. Unanticipated changes in environmental regulations could require us to make significant capital expenditures for our facilities and adversely affect our results of operations and cash flow.

Previous wording

The Company’s common stock repurchases are made pursuant to the board-approved plan to repurchase up to $1.1 billion of the Company’s common stock. During the three months ended March 31, 2025 and March 31, 2024, the Company repurchased and retired 256,473 and 27,265 shares, respectively, of the Company’s common stock for total expenditures of $55.0 million and $5.0 million, respectively.

Current wording

The Company’s board of directors approved a plan to repurchase up to $1.1 billion of the Company’s common stock. During the three and six months ended June 30, 2025, the Company repurchased and retired 61,657 and 318,130 shares, respectively, of the Company’s common stock for total expenditures of $11.8 million and $66.8 million, respectively. During the three and six months ended June 30, 2024, the Company repurchased and retired 23,397 and 50,662 shares, respectively, of the Company’s common stock for total expenditures of $5.0 million and $10.0 million, respectively.

Previous wording

Through March 31, 2025, the Company has repurchased and retired a total of approximately 9.0 million shares of its common stock for $655.9 million under the board-approved plan, and, as of March 31, 2025, an additional $444.1 million remained available for repurchase of shares.

Current wording

From the board’s approval of the repurchase plan through June 30, 2025, the Company has repurchased and retired a total of approximately 9.1 million shares of its common stock for $667.6 million under the board-approved plan, and, as of June 30, 2025, an additional $432.4 million remained available for the repurchase of shares.

Previous wording

Total environmental liabilities as of March 31, 2025 were $234.0 million, a decrease of $7.5 million compared to December 31, 2024. During the three months ended March 31, 2025, the environmental liability balance decreased due to changes in environmental liability estimates of $9.8 million and expenditures of $2.6 million. These decreases were partially offset by accretion of $3.6 million and new environmental liabilities, including those recognized as a result of recent acquisitions, of $1.2 million. The change in environmental liability estimates was primarily driven by a $10 million decrease in the remedial liability for a site based on our conclusion that loss was no longer probable based on recent evaluation of available evidence.

Current wording

Total environmental liabilities as of June 30, 2025 were $236.2 million, a decrease of $5.3 million compared to December 31, 2024. During the six months ended June 30, 2025, the environmental liability balance decreased due to reductions in environmental liability estimates of $8.0 million and expenditures of $7.1 million. The reduction in environmental liability estimates was primarily driven by a decrease of approximately $10 million in the remedial liability for a site based on our conclusion that loss was no longer probable based on recent evaluation of available evidence. This change was recorded in the first quarter of 2025.These decreases were partially offset by accretion of $7.2 million and new environmental liabilities, including those recognized as a result of recent acquisitions, of $2.1 million.

Previous wording

We obtain standby letters of credit as security for financial assurances we have been required to provide to regulatory bodies for our hazardous waste facilities and which would be called only in the event that we fail to satisfy closure, post-closure and other obligations under the permits issued by those regulatory bodies for such licensed facilities. As of March 31, 2025, there were $137.6 million outstanding letters of credit. See Note 11, “Financing Arrangements,” to the accompanying unaudited consolidated financial statements.

Current wording

We obtain standby letters of credit as security for financial assurances we have been required to provide to regulatory bodies for our hazardous waste facilities and which would be called only in the event that we fail to satisfy closure, post-closure and other obligations under the permits issued by those regulatory bodies for such licensed facilities. As of June 30, 2025, there were $147.9 million outstanding letters of credit. See Note 11, “Financing Arrangements,” to the accompanying unaudited consolidated financial statements.

Previous wording

In the first three months of 2025, there were no material changes to the information provided under the heading “Critical Accounting Estimates” included in our Annual Report on Form 10-K for the year ended December 31, 2024. For more information regarding our accounting policies, please refer to Note 2, “Significant Accounting Policies” to the accompanying unaudited consolidated financial statements.

Current wording

In the first six months of 2025, there were no material changes to the information provided under the heading “Critical Accounting Estimates” included in our Annual Report on Form 10-K for the year ended December 31, 2024. For more information regarding our accounting policies, please refer to Note 2, “Significant Accounting Policies” to the accompanying unaudited consolidated financial statements.