Crystal Clean, or Heritage-Crystal Clean Inc. (Nasdaq: HCCI), a hazardous waste treatment and disposal company operating in North America, saw a revenue increase of 32.2 percent between Q1 2021 and Q1 2022, and is excited to continue this growth throughout the 2022 fiscal year. The company released their Q2 financial results, reporting a record high net income of $21.1 million.

Jonathan Pierron, Associate Editor & Content Producer

July 28, 2022

2 Min Read
Heritage-Crystal Clean
Heritage-Crystal Clean

Crystal Clean, or Heritage-Crystal Clean Inc. (Nasdaq: HCCI), a hazardous waste treatment and disposal company operating in North America, saw a revenue increase of 32.2 percent between Q1 2021 and Q1 2022.

The company released their Q2 financial results, reporting a record high net income of $21.1 million, which is up 39.7 percent compared to net income of $15.1 recorded in Q2 of last year. The report also reflected similar rates of revenue growth as Q1 comparisons with a growth rate of 33.6 percent between Q2 2021 and Q2 2022.

During the quarter, which ended on June 18, the company saw an overall operating margin increase of $12.2 million on an increased percentage of revenue basis of 29.7 percent. This continued growth is attributed to the company's Oil Business segment and is a slight increase from the 29.3 percent of this quarter last year.

The Oil Business segment of Crystal Clean is comprised primarily of oil collection and re-refining activities, with a component working in sales of recycled fuel oil.

President of the company Brian Recatto had the following to say about this sector: "Structural changes in the used oil re-refining business, along with refining industry capacity limitations, provided the foundation for our team to deliver excellent results during the second quarter. We couldn't be more excited about the performance of our Oil Business team who produced a record fifth straight quarter of operating margin above 33.0 percent."

Another segment of the company did not see such great operating margins on this quarters report. The Environmental Services segment pertaining to parts cleaning, containerized waste, wastewater vacuum, antifreeze recycling, and field services had a 4.9 percent decrease in revenue. The difference in operating margin percentage of about $600,000 is believed to be due to high levels of inflation and higher disposal and transportation costs than usual.

“We look to improve our operating margin percentage further in the coming quarters as we continue to battle high inflation in various parts of our business” says Recatto.

However, this segment did see an increase in revenue. With a revenue of $91.9 million, the Environmental Services sector saw a 26.4 percent increase compared to Q2 2021’s revenue of $72.7 million. The company points to an increase in demand for their services compared to the prior year quarter as the explanation for this.

Even with an increased operating costs, Crystal Clean still managed to increase adjusted EBITDA 43.1 percent compared to the second quarter of 2021. This is an increase of $12 million, going from $27.9 million to $39.9 million between June 19, 2021 and June 18 2022.

Looking into the next quarter, Recatto is anticipating closing an acquisition deal with which is expected to increase the companies hand in the western United States, hopefully leading to a grand increase in EBITDA and revenue.

Q2 2022 Highlights

Revenue: $156.6 million (Q2 2021: $117.3 million)

Net Income:  $21.1 million (Q2 2021: $15.1 million)

Adjusted EBITDA: $39.9 million (Q2 2021: $27.9 million)

About the Author(s)

Jonathan Pierron

Associate Editor & Content Producer

John Pierron is the associate editor of Waste360. He graduated from Ohio University.

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