EX-99.1 2 qrhc-ex99_1.htm EX-99.1 EX-99.1

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Exhibit 99.1

Quest Resource Holding Corporation Reports First Quarter 2022 Financial Results

THE COLONY, TX – May 16, 2022 – 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 first quarter ended March 31, 2022.

First Quarter 2022 Highlights

Revenue was $71.5 million, a 103.8% increase compared with the first quarter of 2021.
Gross profit was $11.2 million, a 74.7% increase compared with the first quarter of 2021.
GAAP net loss per share attributable to common stockholders was ($0.11) per basic and diluted share, compared with net income of $0.06 per basic and diluted share during the first quarter of 2021.
Adjusted EBITDA was $3.7 million, a 42.2% increase compared with the first quarter of 2021.
Adjusted net income per diluted share was $0.06, compared with $0.07 per diluted share during the first quarter of 2021.

“We delivered another quarter of solid financial performance with strong growth in gross profit dollars coming from onboarding new customers, expansion with existing customers, as well as from acquisitions,” said S. Ray Hatch, President and Chief Executive Officer of the Company. “Our customer value proposition is resonating well, demand for cost-effective sustainability solutions is increasing, and our pipeline of prospects is robust and expanding. We have been busy integrating recent acquisitions and see several opportunities to cross-sell services, as well as opportunities to improve operational and financial performance of the acquired businesses by leveraging the capabilities of our platform. We are investing in talent acquisition as well as technology and process improvements to drive future growth and improve the efficiency and scalability of our platform. We expect continued momentum in 2022 and the next several years from both organic and acquisitive sources.”

First Quarter 2022 Earnings Conference Call and Webcast

Quest will conduct a conference call Monday, May 16, 2022, at 5:00 PM ET, to review the Company's financial results and business outlook. 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, referencing conference ID: 7088790. 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. 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 Measures

In this press release, non-GAAP financial measures, "Adjusted EBITDA," and “Adjusted Net Income” 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 it 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 Income (Loss) to Adjusted EBITDA." and “Adjusted Net Income Per Share”).

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.

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 of continued momentum in 2022 and the next several years from both organic and acquisitive sources. 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 the potential effect of inflationary pressures and increased interest rates on our costs of doing business, the spread of major epidemics (including Coronavirus) and other related uncertainties such as government-imposed travel restrictions, 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 Report on Form 10-K for the year ended December 31, 2021. 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 December 31,

 

 

 

2022

 

 

2021

 

 

 

(Unaudited)

 

Revenue

 

$

71,522

 

 

$

35,102

 

Cost of revenue

 

 

60,274

 

 

 

28,662

 

Gross profit

 

 

11,248

 

 

 

6,440

 

Selling, general, and administrative

 

 

9,344

 

 

 

4,263

 

Depreciation and amortization

 

 

2,365

 

 

 

407

 

Total operating expenses

 

 

11,709

 

 

 

4,670

 

Operating income (loss)

 

 

(461

)

 

 

1,770

 

Interest expense

 

 

(1,556

)

 

 

(561

)

Income (loss) before taxes

 

 

(2,017

)

 

 

1,209

 

Income tax expense

 

 

167

 

 

 

62

 

Net income (loss)

 

$

(2,184

)

 

$

1,147

 

 

 

 

 

 

 

 

Net income (loss) applicable to common stockholders

 

$

(2,184

)

 

$

1,147

 

Net income (loss) per common share:

 

 

 

 

 

 

Basic

 

$

(0.11

)

 

$

0.06

 

Diluted

 

$

(0.11

)

 

$

0.06

 

Weighted average number of common shares outstanding:

 

 

 

 

 

 

Basic

 

 

19,245

 

 

 

18,505

 

Diluted

 

 

19,245

 

 

 

19,413

 

 

 

 

 


RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA

(Unaudited)

(In thousands)

 

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Net income (loss)

 

$

(2,184

)

 

$

1,147

 

Depreciation and amortization

 

 

2,437

 

 

 

476

 

Interest expense

 

 

1,556

 

 

 

561

 

Stock-based compensation expense

 

 

259

 

 

 

310

 

Acquisition, integration, and related costs

 

 

1,306

 

 

 

19

 

Other adjustments

 

 

196

 

 

 

53

 

Income tax expense

 

 

167

 

 

 

62

 

Adjusted EBITDA

 

$

3,737

 

 

$

2,628

 

 

 

ADJUSTED NET INCOME PER SHARE

(Unaudited)

(In thousands)

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Reported net income (loss) (1)

 

$

(2,184

)

 

$

1,147

 

Amortization of intangibles (2)

 

 

2,174

 

 

 

289

 

Acquisition, integration, and related costs (3)

 

 

1,306

 

 

 

19

 

Adjusted net income

 

$

1,296

 

 

$

1,455

 

 

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

 

Reported net income (loss)

 

$

(0.11

)

 

$

0.06

 

Adjusted net income

 

$

0.07

 

 

$

0.07

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding:

 

 

 

 

 

 

Diluted (4)

 

 

21,716

 

 

 

19,413

 

 

(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 adjustment for dilution as adjusted net income is positive

 

 

 


BALANCE SHEETS

(In thousands, except per share amounts)

 

 

 

March 31,

 

 

December 31,

 

 

 

2022

 

 

2021

 

 

 

(Unaudited)

 

 

 

 

ASSETS

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

7,922

 

 

$

8,428

 

Accounts receivable, less allowance for doubtful accounts of $1,054
   and $841 as of March 31, 2022 and December 31, 2021, respectively

 

 

46,562

 

 

 

39,949

 

Prepaid expenses and other current assets

 

 

2,008

 

 

 

1,952

 

Total current assets

 

 

56,492

 

 

 

50,329

 

 

 

 

 

 

 

 

Goodwill

 

 

81,165

 

 

 

80,622

 

Intangible assets, net

 

 

39,717

 

 

 

39,119

 

Property and equipment, net, and other assets

 

 

5,395

 

 

 

5,596

 

Total assets

 

$

182,769

 

 

$

175,666

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

Current liabilities:

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

34,862

 

 

$

30,196

 

Other current liabilities

 

 

7,046

 

 

 

6,195

 

Current portion of notes payable

 

 

1,644

 

 

 

1,329

 

Total current liabilities

 

 

43,552

 

 

 

37,720

 

 

 

 

 

 

 

 

Notes payable, net

 

 

65,716

 

 

 

62,409

 

Other long-term liabilities

 

 

1,798

 

 

 

1,909

 

Total liabilities

 

 

111,066

 

 

 

102,038

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Preferred stock, $0.001 par value, 10,000 shares authorized, no
   shares issued or outstanding as of March 31, 2022 and December 31, 2021

 

 

 

 

 

 

Common stock, $0.001 par value, 200,000 shares authorized,
   19,046 shares issued and outstanding as
   of March 31, 2022 and December 31, 2021

 

 

19

 

 

 

19

 

Additional paid-in capital

 

 

170,577

 

 

 

170,318

 

Accumulated deficit

 

 

(98,893

)

 

 

(96,709

)

Total stockholders’ equity

 

 

71,703

 

 

 

73,628

 

Total liabilities and stockholders’ equity

 

$

182,769

 

 

$

175,666

 

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