Thursday - April 3, 2025
THE COLONY, Texas, March 12, 2025 (GLOBE NEWSWIRE) -- Quest Resource Holding Corporation (Nasdaq: QRHC) (“Quest” or the “Company”), a national leader in environmental waste and recycling services, today announced financial results for the fourth quarter and fiscal year ended December 31, 2024.
Fourth Quarter 2024 Financial Highlights:
Fiscal Year 2024 Financial Highlights:
During 2024, Quest achieved several milestones:
“In 2024, we made meaningful progress executing against our key strategic priorities,” said Dan M. Friedberg, Chairman of the Company’s Board of Directors. “We added and are in the process of onboarding eight new customers and have expanded agreements with five of some of our largest customers, representing a record amount of new customer activity for the Company in a year. Further, the Company successfully refinanced its long-term debt with our existing lenders, reflecting their continued confidence in the business.”
Friedberg added, “Despite our success in growing the customer base and the substantial activity underway to solidify operations and efficiencies, we clearly recognize more needs to be done to address our execution issues. Our performance was affected by several factors: temporary cost increases from onboarding new clients, expenses for implementing our new vendor management system, client attrition, and weakness in our industrial client end markets. We believe the actions we have taken and the initiatives now underway will normalize operations in the coming quarters and help position Quest to drive long-term results.”
Specific actions include:
Perry Moss, Quest’s Chief Executive Officer, stated, “I believe strongly in Quest’s value proposition and in the power of our platform. We have a tremendous roster of clients, and a highly capable organization focused on generating value for our stakeholders. Importantly, we have a robust pipeline of potential new business, and we expect to continue to deepen client relationships, add valuable services and solutions, invest in our business and people, and improve profitability.”
Mr. Friedberg concluded, “The board and management team are committed to driving change and enhancing shareholder value. We have a strong platform and are focused on operational excellence. We have implemented performance-focused actions and will continue pursuing initiatives to drive value for all stakeholders.”
Fourth Quarter and Fiscal Year 2024 Earnings Conference Call and Webcast
Quest will conduct a conference call Wednesday, March 12, 2025, at 5:00 PM ET, to review the financial results for the fourth quarter and year ended December 31, 2024. Investors interested in participating on the live call can dial 1-800-717-1738 or 1-646-307-1865. 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 https://investors.qrhc.com/investors. A replay of the webcast will be archived on Quest’s investor relations website for 90 days.
About Quest Resource Holding Corporation
Quest is a national provider of waste and recycling services that enable larger businesses to excel in achieving their environmental and sustainability goals and responsibilities. Quest delivers focused expertise across multiple industry sectors to build single-source, client-specific solutions that generate quantifiable business and sustainability results. Addressing a wide variety of waste streams and recyclables, Quest provides information and data that tracks and reports the environmental results of Quest’s services, gives actionable data to improve business operations, and enables Quest’s clients to excel in their business and sustainability responsibilities. For more information, visit www.qrhc.com.
Reconciliation of U.S. GAAP to Non-GAAP Financial Measures
In this press release, non-GAAP financial measures, "Adjusted EBITDA," and “Adjusted Net Income (Loss)” are presented. From time-to-time, Quest considers and uses these supplemental measures 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 these non-GAAP measures because it considers them an important supplemental measure of Quest's performance. Quest’s definition of these adjusted financial measures may differ from similarly named measures used by others. Quest believes these measures facilitate 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. These non-GAAP measures have limitations as an analytical tool and should not be considered in isolation or as a substitute for the Company's GAAP measures. (See attached tables “Reconciliation of Net Loss to Adjusted EBITDA” and “Adjusted Net Income (Loss) Per Share”).
Safe Harbor Statement
This 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 expectation that we will continue to deepen client relationships, add valuable services and solutions, and invest in our business and people, resulting in long-term, continuously expanding client relationships; and our belief that the implementation of a reduction of headcount by 15%, combined with the partial sale of RWS and ongoing efficiency improvement gains, should reduce SG&A by approximately $3.0 million on an annualized basis. 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, interruptions to supply chains, commodity price fluctuations, and extended shut down of businesses, 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, 2024. 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
Joe Noyons
817.778.8424
Financial Tables Follow |
Quest Resource Holding Corporation and Subsidiaries STATEMENTS OF OPERATIONS (In thousands, except per share amounts) | ||||||||||||||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||
Revenue | $ | 69,970 | $ | 69,342 | $ | 288,532 | $ | 288,378 | ||||||||||||||||||||||||
Cost of revenue | 59,243 | 57,842 | 238,537 | 238,313 | ||||||||||||||||||||||||||||
Gross profit | 10,727 | 11,500 | 49,995 | 50,065 | ||||||||||||||||||||||||||||
Selling, general, and administrative | 10,086 | 9,419 | 39,543 | 37,669 | ||||||||||||||||||||||||||||
Depreciation and amortization | 2,307 | 2,352 | 9,401 | 9,571 | ||||||||||||||||||||||||||||
Impairment loss | 5,511 | — | 5,511 | — | ||||||||||||||||||||||||||||
Total operating expenses | 17,904 | 11,771 | 54,455 | 47,240 | ||||||||||||||||||||||||||||
Operating income (loss) | (7,177 | ) | (271 | ) | (4,460 | ) | 2,825 | |||||||||||||||||||||||||
Interest expense | (2,505 | ) | (2,322 | ) | (10,312 | ) | (9,729 | ) | ||||||||||||||||||||||||
Loss before taxes | (9,682 | ) | (2,593 | ) | (14,772 | ) | (6,904 | ) | ||||||||||||||||||||||||
Income tax expense (benefit) | (174 | ) | (263 | ) | 291 | 387 | ||||||||||||||||||||||||||
Net loss | $ | (9,508 | ) | $ | (2,330 | ) | $ | (15,063 | ) | $ | (7,291 | ) | ||||||||||||||||||||
Net loss applicable to common stockholders | $ | (9,508 | ) | $ | (2,330 | ) | $ | (15,063 | ) | $ | (7,291 | ) | ||||||||||||||||||||
Net loss per common share: | ||||||||||||||||||||||||||||||||
Basic | $ | (0.46 | ) | $ | (0.11 | ) | $ | (0.73 | ) | $ | (0.36 | ) | ||||||||||||||||||||
Diluted | $ | (0.46 | ) | $ | (0.11 | ) | $ | (0.73 | ) | $ | (0.36 | ) | ||||||||||||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||||||||||||||||||
Basic | 20,837 | 20,264 | 20,617 | 20,123 | ||||||||||||||||||||||||||||
Diluted | 20,837 | 20,264 | 20,617 | 20,123 | ||||||||||||||||||||||||||||
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA (Unaudited) (In thousands) | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||
Net loss | $ | (9,508 | ) | $ | (2,330 | ) | $ | (15,063 | ) | $ | (7,291 | ) | |||
Depreciation and amortization | 2,558 | 2,462 | 10,272 | 9,948 | |||||||||||
Interest expense | 2,505 | 2,322 | 10,312 | 9,729 | |||||||||||
Stock-based compensation expense | 272 | 362 | 1,563 | 1,312 | |||||||||||
Acquisition, integration, and related costs | 21 | 598 | 112 | 1,624 | |||||||||||
Impairment loss | 5,511 | — | 5,511 | — | |||||||||||
Other adjustments | 491 | 329 | 1,471 | 501 | |||||||||||
Income tax expense (benefit) | (174 | ) | (263 | ) | 291 | 387 | |||||||||
Adjusted EBITDA | $ | 1,676 | $ | 3,480 | $ | 14,469 | $ | 16,210 | |||||||
ADJUSTED NET INCOME (LOSS) PER SHARE (Unaudited) (In thousands) | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||
Reported net loss(1) | $ | (9,508 | ) | $ | (2,330 | ) | $ | (15,063 | ) | $ | (7,291 | ) | |||
Amortization of intangibles(2) | 2,137 | 2,196 | 8,787 | 8,864 | |||||||||||
Acquisition, integration, and related costs(3) | 21 | 598 | 112 | 1,624 | |||||||||||
Impairment loss | 5,511 | — | 5,511 | — | |||||||||||
Other adjustments(4) | — | 280 | — | 205 | |||||||||||
Adjusted net income (loss) | $ | (1,839 | ) | $ | 744 | $ | (653 | ) | $ | 3,402 | |||||
Diluted earnings (loss) per share: | |||||||||||||||
Reported net loss | $ | (0.46 | ) | $ | (0.11 | ) | $ | (0.73 | ) | $ | (0.36 | ) | |||
Adjusted net income (loss) | $ | (0.09 | ) | $ | 0.03 | $ | (0.03 | ) | $ | 0.15 | |||||
Weighted average number of common shares outstanding: Diluted(5) | 20,837 | 22,502 | 20,617 | 22,362 | |||||||||||
(1) Applicable to common stockholders (2) Reflects the elimination of non-cash amortization of acquisition-related intangible assets (3) Reflects the add back of acquisition/integration related transaction costs (4) Reflects adjustments to earn-out fair value (5) Reflects adjustment for dilution when adjusted net income is positive | |||||||||||||||
BALANCE SHEETS (In thousands, except per share amounts) | |||||||
December 31, | December 31, | ||||||
2024 | 2023 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 396 | $ | 324 | |||
Accounts receivable, less allowance for doubtful accounts of $831 and $1,582 as of December 31, 2024 and 2023, respectively | 62,252 | 58,147 | |||||
Prepaid expenses and other current assets | 2,601 | 2,142 | |||||
Assets held for sale | 9,890 | — | |||||
Total current assets | 75,139 | 60,613 | |||||
Goodwill | 81,065 | 85,828 | |||||
Intangible assets, net | 12,946 | 26,052 | |||||
Property and equipment, net, and other assets | 6,495 | 4,626 | |||||
Total assets | $ | 175,645 | $ | 177,119 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable and accrued liabilities | $ | 39,899 | $ | 41,296 | |||
Other current liabilities | 1,001 | 2,470 | |||||
Current portion of notes payable | 1,651 | 1,159 | |||||
Liabilities held for sale | 1,840 | — | |||||
Total current liabilities | 44,391 | 44,925 | |||||
Notes payable, net | 76,265 | 64,638 | |||||
Other long-term liabilities | 833 | 1,275 | |||||
Total liabilities | 121,489 | 110,838 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Preferred stock, $0.001 par value, 10,000 shares authorized, no shares issued or outstanding as of December 31, 2024 and 2023 | — | — | |||||
Common stock, $0.001 par value, 200,000 shares authorized, 20,606 and 20,161 shares issued and outstanding as of December 31, 2024 and 2023, respectively | 21 | 20 | |||||
Additional paid-in capital | 179,246 | 176,309 | |||||
Accumulated deficit | (125,111 | ) | (110,048 | ) | |||
Total stockholders’ equity | 54,156 | 66,281 | |||||
Total liabilities and stockholders’ equity | $ | 175,645 | $ | 177,119 | |||
Last Trade: | US$2.65 |
Daily Change: | 0.03 1.15 |
Daily Volume: | 61,174 |
Market Cap: | US$54.560M |
March 12, 2025 December 17, 2024 November 07, 2024 |
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