Quest Resource Holding Corporation Reports Third Quarter 2019 Financial Results
THE COLONY, Texas, Nov. 14, 2019 (GLOBE NEWSWIRE) — Quest Resource Holding Corporation (NASDAQ: QRHC) (“Quest”), a national leader in environmental reuse, recycling, and waste disposal services, today announced financial results for the third quarter ended September 30, 2019.
Third Quarter 2019 HighlightsRevenue was $23.9 million, a 7.7% decrease compared with the third quarter of 2018.Gross profit was $4.8 million, a 6.7% increase compared with the third quarter of 2018.Gross margin increased 270 basis points to 19.9% compared with 17.2% of revenue for the third quarter of 2018.Net income per share was $0.00, an improvement compared with a net loss per share of $(0.04) during the third quarter of 2018. Adjusted EBITDA was $860,000, a 27.5% increase compared with the third quarter of 2018.September 30, 2019 Year-to-Date HighlightsRevenue was $76.0 million, a 3.2% decrease compared with the same period of 2018.Gross profit was $14.1 million, a 13.0% increase compared with the same period of 2018.Gross margin increased 270 basis points to 18.5% compared with 15.8% of revenue for the same period of 2018.Net loss per share improved to $(0.01), including $248,000, or $0.02 per share, of expenses related to our April 2019 equity offering by selling shareholders, compared to $(0.17) during the same period of 2018. Year-to-date Adjusted EBITDA was $2.5 million, a 58.2% increase compared to the same period of 2018.Key Recent HighlightsNew sales leadership – Quest appointed Matthew C. Lewis as Senior Vice President of Sales. Mr. Lewis brings more than 30 years of experience in sales and operations leadership in complex end markets within the waste and environmental services industry. “We delivered record gross profit and 27% growth in Adjusted EBITDA during the quarter, reflecting our continued success in transitioning our business to focus on providing higher value-added solutions to our customers. As previously discussed and expected, our transition away from lower value-added solutions has resulted in challenging revenue comparisons relative to prior periods,” said S. Ray Hatch, President and Chief Executive Officer. “With solid year-to-date performance, we believe we are on track to meet our profitability goals for 2019, which include 10%+ growth in gross profit. We continue to find acceptance across multiple end markets, including the food service vertical where recent wins provide us with an opportunity to demonstrate our differentiated and compelling value proposition. We also have additional growth opportunities with our existing customers who value our flexible solution offerings and the service levels we provide.”Third Quarter 2019 Earnings Conference Call and WebcastQuest will conduct a conference call Thursday, November 14, 2019, at 4:00 p.m. Central Time, to review the financial results for the third quarter ended September 30, 2019. Investors interested in participating on the live call can dial 1-800-289-0438 within the U.S. or 1-323-794-2423 from abroad. 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 www.QRHC.com. 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 MeasuresIn this press release, a non-GAAP financial measure, “Adjusted EBITDA,” is presented. From time-to-time, Quest considers and uses this supplemental measure 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 this non-GAAP measure because it considers it an important supplemental measure of Quest’s performance. Quest’s definition of this adjusted financial measure may differ from similarly named measures used by others. Quest believes this measure facilitates 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. This non-GAAP measure has limitations as an analytical tool and should not be considered in isolation or as a substitute for the Company’s GAAP measures. (See attached table “Reconciliation of Net Income (Loss) to Adjusted EBITDA.”)About Quest Resource Holding CorporationQuest is a national provider of reuse, recycling, and disposal services that enable our customers to achieve and satisfy their environmental and sustainability goals and responsibilities. Quest provides businesses across multiple industry sectors with single source, customer specific solutions to address a wide variety of waste streams and recyclables generated by their operations. Quest also provides information and data that tracks and reports the environmental results of Quest’s services, provides actionable data to improve business operations, and enables Quest’s customers to achieve and satisfy their environmental and sustainability goals and responsibilities. For more information, visit www.QRHC.com.Safe Harbor StatementThis 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 belief we now target the right markets with the right services; our belief we have operations in place to sustainably support profitability while consistently providing excellent customer service; our belief that our efforts have positioned us well to grow sales at our targeted rate of 10% to 15% per year; our expectation profitability will continue to grow at an even faster pace, at our current business levels, coupled with the operating leverage inherent in our business model; and our belief that the financial measures contained in this press release facilitate operating performance comparisons from period to period. Words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “predict,” “believe” and similar words, expressions and variations of these words and expressions are intended to identify forward-looking statements. These statements are based on our current expectations, estimates, projections, beliefs, and assumptions. Such statements involve significant risks and uncertainties. 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, 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, 2018, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. 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, LLC
817.778.8424Financial Tables FollowQuest Resource Holding Corporation and SubsidiariesSTATEMENTS OF OPERATIONS
(In thousands, except per share amounts)RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(In thousands)BALANCE SHEETS
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