Enviri (NVRI) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenues were $610 million, flat year-over-year with 6% organic growth, and adjusted EBITDA rose 7% to $86 million, driven by Clean Earth and Harsco Rail segments despite FX and divestiture headwinds.

• Net leverage ratio fell below 4x for the first time since 2020, supporting debt reduction targets and improved financial flexibility.

• Net loss for Q2 2024 was $11.1 million, compared to a net loss of $15.8 million in Q2 2023, with adjusted diluted EPS at $0.02, down from $0.05 last year.

• All business segments exceeded expectations, with Clean Earth posting record margins and Rail showing strong core growth despite contract losses.

• The company maintains a positive outlook, expecting stable or improved results in Environmental and Clean Earth, and operational improvements in Rail, excluding certain charges.

Financial highlights

• Q2 2024 revenues were $610 million, flat on a reported basis but up 6% organically after adjusting for FX, divestitures, and one-time items.

• Adjusted EBITDA reached $86 million, up 7% year-over-year and 10% sequentially, with a margin of 14.1%, the highest since 2020.

• Adjusted EPS was $0.02; free cash flow was $9.5 million, a $60 million improvement from a $51 million deficit in Q2 2023.

• GAAP diluted loss per share from continuing operations was $(0.16), compared to $(0.13) in Q2 2023.

• Net cash from operating activities improved to $39 million from a $9 million outflow in Q2 2023.

Outlook and guidance

• Full-year 2024 adjusted EBITDA guidance remains $327–$340 million, implying ~9% year-over-year growth.

• Adjusted EPS guidance is $0.07 to -$0.09; adjusted free cash flow target is $10–$30 million.

• Q3 adjusted EBITDA expected at $85–$92 million; Clean Earth and Rail EBITDA to grow, HE EBITDA to be flat year-over-year.

• Free cash flow in Q3 anticipated to decline from Q2 due to timing effects.

• Segment outlook: Harsco Environmental flat, Clean Earth and Harsco Rail to grow adjusted EBITDA versus 2023.