Stericycle (SRCL) Q2 2024 earnings summary

Executive summary

• Entered into a Merger Agreement with Waste Management, Inc. on June 3, 2024, for $7.2 billion ($62.00 per share), pending shareholder and regulatory approval.

• Diluted EPS improved by $0.60 compared to Q2 2023; net income was $6.0 million versus a net loss of $49.5 million in Q2 2023.

• Revenue for Q2 2024 was $661.6 million, down 1.2% year-over-year, mainly due to divestitures and lower commodity-indexed revenues.

• Operational optimization and cost-saving initiatives are ongoing, with expected annual savings of $21–24 million from recent workforce reductions.

• Management is focused on margin expansion, digital implementation, and strategic capital allocation.

Financial highlights

• Q2 2024 revenue: $661.6 million (down 1.2% year-over-year); six-month revenue: $1,326.5 million (down 2.0%).

• Q2 2024 net income: $6.0 million; six-month net income: $19.1 million.

• Q2 2024 gross profit: $258.0 million (39.0% margin, up from 37.5% in Q2 2023).

• Q2 2024 SG&A: $227.5 million (34.4% of revenue, up from 33.0% in Q2 2023).

• Q2 2024 diluted EPS: $0.06 (up from $(0.54) in Q2 2023); six-month diluted EPS: $0.21 (up from $(0.41)).

Outlook and guidance

• Management expects continued focus on profitable revenue growth, operational excellence, and digital transformation.

• Strategic capital allocation targets a debt leverage ratio between 2.5x–3.0x.

• McCarran, Nevada incinerator project on track to begin processing waste by end of 2024.