Enviri Corporation Reports Third Quarter 2023 Results

Enviri
Enviri
  • Third Quarter Revenues from Continuing Operations Totaled $525 Million, an Increase of 8 Percent Over the Prior-Year Quarter

  • Q3 GAAP Operating Income from Continuing Operations of $30 Million

  • Adjusted EBITDA from Continuing Operations in Q3 Totaled $79 million, an Increase of 12 Percent Over the Prior-Year Quarter

  • Credit Agreement Net Leverage Ratio Declined Further, to 4.5x at Quarter-End

  • Full Year 2023 Adjusted EBITDA Guidance Range Increased to Between $282 Million and $289 Million; From Prior Range of $270 Million to $285 Million

PHILADELPHIA, Nov. 02, 2023 (GLOBE NEWSWIRE) -- Enviri Corporation (NYSE: NVRI) today reported third quarter 2023 results. On a U.S. GAAP ("GAAP") basis, the third quarter of 2023 diluted loss per share from continuing operations was $0.11, after strategic expenses, an accounts receivable provision (linked to an idled steel mill) and other unusual items. Adjusted diluted earnings per share from continuing operations in the third quarter of 2023 was $0.05. These figures compare with third quarter of 2022 GAAP diluted earnings per share from continuing operations of $0.01 and adjusted diluted earnings per share from continuing operations of $0.10.

GAAP operating income from continuing operations for the third quarter of 2023 was $30 million. Adjusted EBITDA was $79 million in the quarter, compared to the Company's previously provided guidance range of $67 million to $74 million.

“Enviri again delivered strong results in the third quarter, with both Clean Earth and Harsco Environmental realizing meaningful year-on-year earnings growth thanks to solid execution across the Company,” said Enviri Chairman and CEO Nick Grasberger. “Our adjusted EBITDA margin in the third quarter was the highest since early 2020, reflecting strong operational and cost performance, successful improvement initiatives, and the continued recognition of our value-proposition by customers. We also made further progress on our ongoing objective to reduce leverage, supported by healthy cash flow generated by CE and HE.

"Looking ahead, our outlook for Q4 is positive and we’re optimistic about further business growth into 2024. Our competitive position is strong and internal initiatives will continue to further solidify our strong foundation. Lastly, the sale process for our Rail business is ongoing, and we are confident that an agreement will be signed in the coming months.”

Enviri Corporation—Selected Third Quarter Results

($ in millions, except per share amounts)

 

Q3 2023

 

Q3 2022

Revenues

 

$

525

 

 

$

487

 

Operating income/(loss) from continuing operations - GAAP

 

$

30

 

 

$

30

 

Diluted EPS from continuing operations - GAAP

 

$

(0.11

)

 

$

0.01

 

Adjusted EBITDA - Non GAAP

 

$

79

 

 

$

70

 

Adjusted EBITDA margin - Non GAAP

 

 

15.1

%

 

 

14.4

%

Adjusted diluted EPS from continuing operations - Non GAAP

 

$

0.05

 

 

$

0.10

 

Note: Adjusted diluted earnings (loss) per share from continuing operations and adjusted EBITDA details presented throughout this release are adjusted for unusual items; in addition, adjusted diluted earnings per share from continuing operations is adjusted for acquisition-related amortization expense. See below for definition of these non-GAAP measures.

 

Consolidated Third Quarter Operating Results

Consolidated revenues from continuing operations were $525 million, an increase of 8 percent compared with the prior-year quarter. Both Harsco Environmental and Clean Earth realized an increase in revenues compared to the third quarter of 2022 due to higher services pricing and demand. Foreign currency translation positively impacted third quarter 2023 revenues by approximately $5 million (1 percent), compared with the prior-year period.

The Company's GAAP operating income from continuing operations was $30 million for the third quarter of 2023, compared with a GAAP operating income of $30 million in the same quarter of 2022. Meanwhile, adjusted EBITDA totaled $79 million in the third quarter of 2023 versus $70 million in the third quarter of the prior year. Both Harsco Environmental and Clean Earth achieved higher adjusted EBITDA versus the comparable quarter of 2022.

Third Quarter Business Review

Harsco Environmental

($ in millions)

 

Q3 2023

 

Q3 2022

Revenues

 

$

286

 

 

$

265

 

Operating income - GAAP

 

$

18

 

 

$

22

 

Adjusted EBITDA - Non GAAP

 

$

54

 

 

$

51

 

Adjusted EBITDA margin - Non GAAP

 

 

18.9

%

 

 

19.1

%


Harsco Environmental revenues totaled $286 million in the third quarter of 2023, an increase of 8 percent compared with the prior-year quarter. This increase is attributable to higher services and products demand and price increases as well as the impact of FX translation. The segment's GAAP operating income and adjusted EBITDA totaled $18 million and $54 million, respectively, in the third quarter of 2023. These figures compare with GAAP operating income of $22 million and adjusted EBITDA of $51 million in the prior-year period. The year-on-year change in adjusted earnings reflects the impact of higher prices and demand as well as cost improvement initiatives.

Clean Earth

($ in millions)

 

Q3 2023

 

Q3 2022

Revenues

 

$

239

 

 

$

222

 

Operating income (loss) - GAAP

 

$

21

 

 

$

17

 

Adjusted EBITDA - Non GAAP

 

$

34

 

 

$

28

 

Adjusted EBITDA margin - Non GAAP

 

 

14.2

%

 

 

12.7

%


Clean Earth revenues totaled $239 million in the third quarter of 2023, a 7 percent increase over the prior-year quarter as a result of higher services pricing and increased volumes. The segment's GAAP operating income was $21 million and adjusted EBITDA was $34 million in the third quarter of 2023. These figures compare with GAAP operating income of $17 million and adjusted EBITDA of $28 million in the prior-year period. The year-on-year improvement in adjusted earnings reflects the above mentioned factors as well as efficiency initiatives, cost decreases and favorable business mix. As a result, Clean Earth's adjusted EBITDA margin increased to 14.2 percent in the third quarter of 2023 versus 12.7 percent in the comparable quarter of 2022.

Cash Flow

Net cash provided by operating activities was $18 million in the third quarter of 2023, compared with net cash provided by operating activities of $13 million in the prior-year period. Free cash flow (excluding Rail) was $10 million in the third quarter of 2023, compared with $(31) million in the prior-year period. The change in free cash flow compared with the prior-year quarter is attributable to higher cash earnings, working capital changes (net of the accounts receivable securitization benefit of $25 million in the prior-year quarter) and lower net capital spending.

2023 Outlook

The Company has again increased its 2023 guidance for Adjusted EBITDA, reflecting the Company's positive third quarter performance and business momentum. In total, this change relative to the Company's prior outlook can be attributed to improved volumes and margin performance in Clean Earth as well as modestly lower Corporate spending.

For the full year 2023, key business drivers for each segment as well as other guidance details are as follows:

Harsco Environmental adjusted EBITDA is projected to be modestly above prior-year results. For the year, higher services pricing, restructuring benefits, site improvement initiatives and new contracts are expected to be partially offset by FX translation impacts and lower commodity prices.

Clean Earth adjusted EBITDA is expected to significantly increase versus 2022, as a result of higher services pricing and volumes as well as cost reduction and operational improvement actions, offsetting the impacts of continued labor-market and supply-chain (disposal) tightness.

Corporate spending is anticipated to be higher relative to the prior year due to the normalization of certain expenditures, including travel and higher planned incentive compensation.

2023 Full Year Outlook
(Continuing Operations)

Current

Prior

GAAP Operating Income/(Loss)

$103 - $110 million

$97 - $112 million

Adjusted EBITDA

$282 - $289 million

$270 - $285 million

GAAP Diluted Earnings/(Loss) Per Share from Continuing Operations

$(0.50) - $(0.59)

$(0.42) - $(0.58)

Adjusted Diluted Earnings/(Loss) Per Share from Continuing Operations

$(0.08) - $(0.17)

$(0.09) - $(0.25)

Free Cash Flow

$25 - $35 million

$30 - $50 million

Net Interest Expense

$97 million

$94 - $95 million

Account Receivable Securitization Fees

$11 million

$10 million

Pension Expense (Non-Operating)

$22 million

$21 - $22 million

Tax Expense, Excluding Any Unusual Items

$16 - $17 million

$13 - $17 million

Net Capital Expenditures

$125 - $135 million

$125 - $135 million

 

 

 

Q4 2023 Outlook (Continuing Operations)

 

 

GAAP Operating Income

$20 - $27 million

 

Adjusted EBITDA

$62 - $69 million

 

GAAP Diluted Earnings/(Loss) Per Share from Continuing Operations

$(0.10) - $(0.19)

 

Adjusted Diluted Earnings/(Loss) Per Share from Continuing Operations

$(0.03) - $(0.12)

 


Conference Call

The Company will hold a conference call today at 9:00 a.m. Eastern Time to discuss its results and respond to questions from the investment community. Those who wish to listen to the conference call webcast should visit the Investor Relations section of the Company’s website at www.enviri.com. The live call also can be accessed by dialing (833) 630-1956, or (412) 317-1837 for international callers. Please ask to join the Enviri Corporation call. Listeners are advised to dial in approximately ten minutes prior to the call. If you are unable to listen to the live call, the webcast will be archived on the Company’s website.

Forward-Looking Statements

The nature of the Company's business, together with the number of countries in which it operates, subject it to changing economic, competitive, regulatory and technological conditions, risks and uncertainties. In accordance with the "safe harbor" provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, the Company provides the following cautionary remarks regarding important factors that, among others, could cause future results to differ materially from the results contemplated by forward-looking statements, including the expectations and assumptions expressed or implied herein. Forward-looking statements contained herein could include, among other things, statements about management's confidence in and strategies for performance; expectations for new and existing products, technologies and opportunities; and expectations regarding growth, sales, cash flows, and earnings. Forward-looking statements can be identified by the use of such terms as "may," "could," "expect," "anticipate," "intend," "believe," "likely," "estimate," "outlook," "plan" or other comparable terms.

Factors that could cause actual results to differ, perhaps materially, from those implied by forward-looking statements include, but are not limited to: (1) changes in the worldwide business environment in which the Company operates, including changes in general economic conditions or health conditions; (2) changes in currency exchange rates, interest rates, commodity and fuel costs and capital costs; (3) changes in the performance of equity and bond markets that could affect, among other things, the valuation of the assets in the Company's pension plans and the accounting for pension assets, liabilities and expenses; (4) changes in governmental laws and regulations, including environmental, occupational health and safety, tax and import tariff standards and amounts; (5) market and competitive changes, including pricing pressures, market demand and acceptance for new products, services and technologies; (6) the Company's inability or failure to protect its intellectual property rights from infringement in one or more of the many countries in which the Company operates; (7) failure to effectively prevent, detect or recover from breaches in the Company's cybersecurity infrastructure; (8) unforeseen business disruptions in one or more of the many countries in which the Company operates due to political instability, civil disobedience, armed hostilities, public health issues or other calamities; (9) disruptions associated with labor disputes and increased operating costs associated with union organization; (10) the seasonal nature of the Company's business; (11) the Company's ability to successfully enter into new contracts and complete new acquisitions or strategic ventures in the time-frame contemplated, or at all; (12) the Company's ability to negotiate, complete, and integrate strategic transactions; (13) failure to complete a process for the divestiture of the Rail segment on satisfactory terms, or at all; (14) potential severe volatility in the capital or commodity markets; (15) failure to retain key management and employees; (16) the outcome of any disputes with customers, contractors and subcontractors; (17) the financial condition of the Company's customers, including the ability of customers (especially those that may be highly leveraged or have inadequate liquidity) to maintain their credit availability; (18) implementation of environmental remediation matters; (19) risk and uncertainty associated with intangible assets; (20) the risk that the Company may be unable to implement fully and successfully the expected incremental actions at the Clean Earth segment due to market conditions or otherwise and may fail to deliver the expected resulting benefits; and (21) other risk factors listed from time to time in the Company's SEC reports. A further discussion of these, along with other potential risk factors, can be found in Part II, Item 1A, "Risk Factors," of the Company's Quarterly Report on Form 10-Q for the period ended June 30, 2023, and Part I, Item 1A, "Risk Factors," of the Company's Annual Report on Form 10-K for the year ended December 31, 2022, which are filed with the Securities and Exchange Commission. The Company cautions that these factors may not be exhaustive and that many of these factors are beyond the Company's ability to control or predict. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results. The Company undertakes no duty to update forward-looking statements except as may be required by law.

NON-GAAP MEASURES

Measurements of financial performance not calculated in accordance with GAAP should be considered as supplements to, and not substitutes for, performance measurements calculated or derived in accordance with GAAP. Any such measures are not necessarily comparable to other similarly-titled measurements employed by other companies. The most comparable GAAP measures are included within the definitions below.

Adjusted diluted earnings per share from continuing operations: Adjusted diluted earnings (loss) per share from continuing operations is a non-GAAP financial measure and consists of diluted earnings (loss) per share from continuing operations adjusted for unusual items and acquisition-related intangible asset amortization expense. It is important to note that such intangible assets contribute to revenue generation and that intangible asset amortization related to past acquisitions will recur in future periods until such intangible assets have been fully amortized. The Company’s management believes Adjusted diluted earnings per share from continuing operations is useful to investors because it provides an overall understanding of the Company’s historical and future prospects. Exclusion of unusual items permits evaluation and comparison of results for the Company’s core business operations, and it is on this basis that management internally assesses the Company’s performance. Exclusion of acquisition-related intangible asset amortization expense, the amount of which can vary by the timing, size and nature of the Company’s acquisitions, facilitates more consistent internal comparisons of operating results over time between the Company’s newly acquired and long-held businesses, and comparisons with both acquisitive and non-acquisitive peer companies.

Adjusted EBITDA: Adjusted EBITDA is a non-GAAP financial measure and consists of income (loss) from continuing operations adjusted to add back income tax expense; equity income of unconsolidated entities, net; net interest expense; defined benefit pension income (expense); facility fees and debt-related income (expense); and depreciation and amortization (excluding amortization of deferred financing costs); and excludes unusual items. Segment Adjusted EBITDA consists of operating income from continuing operations adjusted to exclude unusual items and add back depreciation and amortization (excluding amortization of deferred financing costs). The sum of the Segments’ Adjusted EBITDA and Corporate Adjusted EBITDA equals consolidated Adjusted EBITDA. The Company‘s management believes Adjusted EBITDA is meaningful to investors because management reviews Adjusted EBITDA in assessing and evaluating performance.

Free cash flow: Free cash flow is a non-GAAP financial measure and consists of net cash provided (used) by operating activities less capital expenditures and expenditures for intangible assets; and plus capital expenditures for strategic ventures, total proceeds from sales of assets and certain transaction-related / debt-refinancing expenditures. The Company's management believes that Free cash flow is meaningful to investors because management reviews Free cash flow for planning and performance evaluation purposes. It is important to note that Free cash flow does not represent the total residual cash flow available for discretionary expenditures since other non-discretionary expenditures, such as mandatory debt service requirements and settlements of foreign currency forward exchange contracts, are not deducted from this measure. Free cash flow excludes the former Harsco Rail Segment since the segment is reported as discontinued operations. This presentation provides a basis for comparison of ongoing operations and prospects.

About Enviri
Enviri is transforming the world to green as a trusted global leader in providing a broad range of environmental services and related innovative solutions. The company serves a diverse customer base by offering critical recycle and reuse solutions for their waste streams, enabling customers to address their most complex environmental challenges and to achieve their sustainability goals. Enviri is based in Philadelphia, Pennsylvania and operates in more than 150 locations in over 30 countries. Additional information can be found at www.enviri.com.


ENVIRI CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30

 

September 30

 

(In thousands, except per share amounts)

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

Revenues from continuing operations:

 

 

 

 

 

 

 

 

 

Revenues

 

$

524,588

 

 

$

486,914

 

 

$

1,540,409

 

 

$

1,420,763

 

 

Costs and expenses from continuing operations:

 

 

 

 

 

 

 

 

 

Cost of sales

 

 

408,743

 

 

 

392,803

 

 

 

1,216,058

 

 

 

1,173,021

 

 

Selling, general and administrative expenses

 

 

84,389

 

 

 

64,146

 

 

 

233,174

 

 

 

201,234

 

 

Research and development expenses

 

 

271

 

 

 

193

 

 

 

947

 

 

 

545

 

 

Goodwill impairment charge

 

 

 

 

 

 

 

 

 

 

 

104,580

 

 

Property, plant and equipment impairment charge

 

 

 

 

 

 

 

 

14,099

 

 

 

 

 

Other expense (income), net

 

 

1,410

 

 

 

(351

)

 

 

(6,964

)

 

 

515

 

 

Total costs and expenses

 

 

494,813

 

 

 

456,791

 

 

 

1,457,314

 

 

 

1,479,895

 

 

Operating income (loss) from continuing operations

 

 

29,775

 

 

 

30,123

 

 

 

83,095

 

 

 

(59,132

)

 

Interest income

 

 

1,679

 

 

 

952

 

 

 

4,701

 

 

 

2,289

 

 

Interest expense

 

 

(26,739

)

 

 

(19,751

)

 

 

(76,791

)

 

 

(51,535

)

 

Facility fees and debt-related income (expense)

 

 

(2,806

)

 

 

(2,511

)

 

 

(7,899

)

 

 

(894

)

 

Defined benefit pension income (expense)

 

 

(5,436

)

 

 

2,118

 

 

 

(16,178

)

 

 

6,775

 

 

Income (loss) from continuing operations before income taxes and equity income

 

 

(3,527

)

 

 

10,931

 

 

 

(13,072

)

 

 

(102,497

)

 

Income tax benefit (expense) from continuing operations

 

 

(4,109

)

 

 

(9,376

)

 

 

(21,351

)

 

 

(7,482

)

 

Equity income (loss) of unconsolidated entities, net

 

 

(151

)

 

 

(128

)

 

 

(593

)

 

 

(373

)

 

Income (loss) from continuing operations

 

 

(7,787

)

 

 

1,427

 

 

 

(35,016

)

 

 

(110,352

)

 

Discontinued operations:

 

 

 

 

 

 

 

 

 

Income (loss) from discontinued businesses

 

 

(3,317

)

 

 

1,993

 

 

 

4,858

 

 

 

(35,225

)

 

Income tax benefit (expense) from discontinued businesses

 

 

1,010

 

 

 

(539

)

 

 

(4,364

)

 

 

5,282

 

 

Income (loss) from discontinued operations, net of tax

 

 

(2,307

)

 

 

1,454

 

 

 

494

 

 

 

(29,943

)

 

Net income (loss)

 

 

(10,094

)

 

 

2,881

 

 

 

(34,522

)

 

 

(140,295

)

 

Less: Net loss (income) attributable to noncontrolling interests

 

 

(708

)

 

 

(802

)

 

 

2,756

 

 

 

(3,056

)

 

Net income (loss) attributable to Enviri Corporation

 

$

(10,802

)

 

$

2,079

 

 

$

(31,766

)

 

$

(143,351

)

 

Amounts attributable to Enviri Corporation common stockholders:

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations, net of tax

 

$

(8,495

)

 

$

625

 

 

$

(32,260

)

 

$

(113,408

)

 

Income (loss) from discontinued operations, net of tax

 

 

(2,307

)

 

 

1,454

 

 

 

494

 

 

 

(29,943

)

 

Net income (loss) attributable to Enviri Corporation common stockholders

 

$

(10,802

)

 

$

2,079

 

 

$

(31,766

)

 

$

(143,351

)

 

 

 

 

 

 

 

 

 

 

 

Weighted-average shares of common stock outstanding

 

 

79,850

 

 

 

79,531

 

 

 

79,767

 

 

 

79,469

 

 

Basic earnings (loss) per common share attributable to Enviri Corporation common stockholders:

 

Continuing operations

 

$

(0.11

)

 

$

0.01

 

 

$

(0.40

)

 

$

(1.43

)

 

Discontinued operations

 

$

(0.03

)

 

$

0.02

 

 

$

0.01

 

 

$

(0.38

)

 

Basic earnings (loss) per share attributable to Enviri Corporation common stockholders

 

$

(0.14

)

 

$

0.03

 

 

$

(0.40

)

(a)

$

(1.80

)

(a)

 

 

 

 

 

 

 

 

 

 

Diluted weighted-average shares of common stock outstanding

 

 

79,850

 

 

 

79,567

 

 

 

79,767

 

 

 

79,469

 

 

Diluted earnings (loss) per common share attributable to Enviri Corporation common stockholders:

 

Continuing operations

 

$

(0.11

)

 

$

0.01

 

 

$

(0.40

)

 

$

(1.43

)

 

Discontinued operations

 

$

(0.03

)

 

$

0.02

 

 

$

0.01

 

 

$

(0.38

)

 

Diluted earnings (loss) per share attributable to Enviri Corporation common stockholders

 

$

(0.14

)

 

$

0.03

 

 

$

(0.40

)

(a)

$

(1.80

)

(a)

  • Does not total due to rounding



ENVIRI CORPORATION
CONSOLIDATED BALANCE SHEETS

 

 

 

 


(In thousands)

 

September 30
2023

 

December 31
2022

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

95,592

 

 

$

81,332

 

Restricted cash

 

 

3,095

 

 

 

3,762

 

Trade accounts receivable, net

 

 

288,030

 

 

 

264,428

 

Other receivables

 

 

29,557

 

 

 

25,379

 

Inventories

 

 

84,569

 

 

 

81,375

 

Prepaid expenses

 

 

33,941

 

 

 

30,583

 

Current portion of assets held-for-sale

 

 

268,993

 

 

 

266,335

 

Other current assets

 

 

27,620

 

 

 

14,541

 

Total current assets

 

 

831,397

 

 

 

767,735

 

Property, plant and equipment, net

 

 

641,434

 

 

 

656,875

 

Right-of-use assets, net

 

 

98,624

 

 

 

101,253

 

Goodwill

 

 

759,027

 

 

 

759,253

 

Intangible assets, net

 

 

331,246

 

 

 

352,160

 

Deferred income tax assets

 

 

14,784

 

 

 

17,489

 

Assets held-for-sale

 

 

89,986

 

 

 

70,105

 

Other assets

 

 

70,937

 

 

 

65,984

 

Total assets

 

$

2,837,435

 

 

$

2,790,854

 

LIABILITIES

 

 

 

 

Current liabilities:

 

 

 

 

Short-term borrowings

 

$

14,006

 

 

$

7,751

 

Current maturities of long-term debt

 

 

14,990

 

 

 

11,994

 

Accounts payable

 

 

202,067

 

 

 

205,577

 

Accrued compensation

 

 

59,224

 

 

 

43,595

 

Income taxes payable

 

 

7,654

 

 

 

3,640

 

Current portion of operating lease liabilities

 

 

25,434

 

 

 

25,521

 

Current portion of liabilities of assets held-for-sale

 

 

139,219

 

 

 

159,004

 

Other current liabilities

 

 

130,295

 

 

 

140,199

 

Total current liabilities

 

 

592,889

 

 

 

597,281

 

Long-term debt

 

 

1,400,428

 

 

 

1,336,995

 

Retirement plan liabilities

 

 

48,593

 

 

 

46,601

 

Operating lease liabilities

 

 

74,305

 

 

 

75,246

 

Liabilities of assets held-for-sale

 

 

4,400

 

 

 

9,463

 

Environmental liabilities

 

 

25,309

 

 

 

26,880

 

Deferred tax liabilities

 

 

31,349

 

 

 

30,069

 

Other liabilities

 

 

46,397

 

 

 

45,277

 

Total liabilities

 

 

2,223,670

 

 

 

2,167,812

 

ENVIRI CORPORATION STOCKHOLDERS’ EQUITY

 

 

 

 

Common stock

 

 

146,079

 

 

 

145,448

 

Additional paid-in capital

 

 

235,245

 

 

 

225,759

 

Accumulated other comprehensive loss

 

 

(550,334

)

 

 

(567,636

)

Retained earnings

 

 

1,582,675

 

 

 

1,614,441

 

Treasury stock

 

 

(849,944

)

 

 

(848,570

)

Total Enviri Corporation stockholders’ equity

 

 

563,721

 

 

 

569,442

 

Noncontrolling interests

 

 

50,044

 

 

 

53,600

 

Total equity

 

 

613,765

 

 

 

623,042

 

Total liabilities and equity

 

$

2,837,435

 

 

$

2,790,854

 



ENVIRI CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

 

 

Three Months Ended
September 30

 

Nine Months Ended
September 30

(In thousands)

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(10,094

)

 

$

2,881

 

 

$

(34,522

)

 

$

(140,295

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation

 

 

35,397

 

 

 

31,892

 

 

 

102,893

 

 

 

97,959

 

Amortization

 

 

8,295

 

 

 

8,538

 

 

 

24,327

 

 

 

25,605

 

Deferred income tax (benefit) expense

 

 

(5,424

)

 

 

(1,660

)

 

 

2,198

 

 

 

(12,056

)

Equity (income) loss of unconsolidated entities, net

 

 

151

 

 

 

128

 

 

 

593

 

 

 

373

 

Dividends from unconsolidated entities

 

 

 

 

 

 

 

 

 

 

 

526

 

(Gain) loss on early extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

(2,254

)

Goodwill impairment charge

 

 

 

 

 

 

 

 

 

 

 

104,580

 

Property, plant and equipment impairment charge

 

 

 

 

 

 

 

 

14,099

 

 

 

 

Other, net

 

 

597

 

 

 

(639

)

 

 

4,743

 

 

 

381

 

Changes in assets and liabilities, net of acquisitions and dispositions of businesses:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

8,217

 

 

 

(12,613

)

 

 

(48,166

)

 

 

74,994

 

Income tax refunds receivable, reimbursable to seller

 

 

 

 

 

 

 

 

 

 

 

7,687

 

Inventories

 

 

(2,596

)

 

 

(2,904

)

 

 

(10,548

)

 

 

(11,339

)

Contract assets

 

 

4,852

 

 

 

1,753

 

 

 

1,317

 

 

 

9,589

 

Right-of-use assets

 

 

8,256

 

 

 

7,446

 

 

 

24,467

 

 

 

21,829

 

Accounts payable

 

 

(13,778

)

 

 

(5,817

)

 

 

(818

)

 

 

13,030

 

Accrued interest payable

 

 

(6,636

)

 

 

(6,819

)

 

 

(6,828

)

 

 

(7,559

)

Accrued compensation

 

 

11,242

 

 

 

325

 

 

 

20,436

 

 

 

(5,559

)

Advances on contracts

 

 

(8,846

)

 

 

7,639

 

 

 

(21,824

)

 

 

(5,987

)

Operating lease liabilities

 

 

(8,190

)

 

 

(7,403

)

 

 

(22,980

)

 

 

(21,498

)

Retirement plan liabilities, net

 

 

606

 

 

 

(6,242

)

 

 

(4,862

)

 

 

(27,829

)

Other assets and liabilities

 

 

(4,067

)

 

 

(3,083

)

 

 

1,647

 

 

 

8,984

 

Net cash provided (used) by operating activities

 

 

17,982

 

 

 

13,422

 

 

 

46,172

 

 

 

131,161

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Purchases of property, plant and equipment

 

 

(27,289

)

 

 

(39,854

)

 

 

(93,630

)

 

 

(101,645

)

Proceeds from sales of assets

 

 

641

 

 

 

1,698

 

 

 

2,080

 

 

 

8,289

 

Expenditures for intangible assets

 

 

(51

)

 

 

(47

)

 

 

(478

)

 

 

(147

)

Proceeds from note receivable

 

 

 

 

 

 

 

 

11,238

 

 

 

8,605

 

Net proceeds (payments) from settlement of foreign currency forward exchange contracts

 

 

4,442

 

 

 

8,572

 

 

 

2,034

 

 

 

13,571

 

Payments for settlements of interest rate swaps

 

 

 

 

 

(463

)

 

 

 

 

 

(2,586

)

Other investing activities, net

 

 

378

 

 

 

67

 

 

 

462

 

 

 

220

 

Net cash used by investing activities

 

 

(21,879

)

 

 

(30,027

)

 

 

(78,294

)

 

 

(73,693

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Short-term borrowings, net

 

 

3,595

 

 

 

308

 

 

 

4,196

 

 

 

277

 

Current maturities and long-term debt:

 

 

 

 

 

 

 

 

Additions

 

 

61,996

 

 

 

54,468

 

 

 

185,992

 

 

 

159,429

 

Reductions

 

 

(49,795

)

 

 

(45,970

)

 

 

(140,522

)

 

 

(198,831

)

Contributions from noncontrolling interests

 

 

 

 

 

 

 

 

1,654

 

 

 

 

Dividends paid to noncontrolling interests

 

 

 

 

 

(4,841

)

 

 

 

 

 

(4,841

)

Sale of noncontrolling interests

 

 

 

 

 

 

 

 

 

 

 

1,901

 

Stock-based compensation - Employee taxes paid

 

 

(136

)

 

 

(119

)

 

 

(1,374

)

 

 

(1,817

)

Payment of contingent consideration

 

 

 

 

 

 

 

 

 

 

 

(6,915

)

Net cash (used) provided by financing activities

 

 

15,660

 

 

 

3,846

 

 

 

49,946

 

 

 

(50,797

)

Effect of exchange rate changes on cash and cash equivalents, including restricted cash

 

 

(2,442

)

 

 

(3,011

)

 

 

(4,231

)

 

 

(8,762

)

Net increase (decrease) in cash and cash equivalents, including restricted cash

 

 

9,321

 

 

 

(15,770

)

 

 

13,593

 

 

 

(2,091

)

Cash and cash equivalents, including restricted cash, at beginning of period

 

 

89,366

 

 

 

100,807

 

 

 

85,094

 

 

 

87,128

 

Cash and cash equivalents, including restricted cash, at end of period

 

$

98,687

 

 

$

85,037

 

 

$

98,687

 

 

$

85,037

 



ENVIRI CORPORATION
REVIEW OF OPERATIONS BY SEGMENT (Unaudited)

 

 

Three Months Ended

 

Three Months Ended

 

 

September 30, 2023

 

September 30, 2022

(In thousands)

 

Revenues

 

Operating
Income (Loss)

 

Revenues

 

Operating Income (Loss)

Harsco Environmental

 

$

285,877

 

$

17,867

 

 

$

264,717

 

$

22,117

 

Clean Earth

 

 

238,711

 

 

21,497

 

 

 

222,197

 

 

17,315

 

Corporate

 

 

 

 

(9,589

)

 

 

 

 

(9,309

)

Consolidated Totals

 

$

524,588

 

$

29,775

 

 

$

486,914

 

$

30,123

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

Nine Months Ended

 

 

September 30, 2023

 

September 30, 2022

(In thousands)

 

Revenues

 

Operating
Income (Loss)

 

Revenues

 

Operating Income (Loss)

Harsco Environmental

 

$

848,659

 

$

52,885

 

 

$

804,367

 

$

63,931

 

Clean Earth

 

 

691,750

 

 

61,002

 

 

 

616,396

 

 

(95,650

)

Corporate

 

 

 

 

(30,792

)

 

 

 

 

(27,413

)

Consolidated Totals

 

$

1,540,409

 

$

83,095

 

 

$

1,420,763

 

$

(59,132

)



ENVIRI CORPORATION
RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS TO DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS AS REPORTED (Unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

September 30

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Diluted earnings (loss) per share from continuing operations, as reported

 

$

(0.11

)

 

$

0.01

 

 

$

(0.40

)

 

$

(1.43

)

Facility fees and debt-related expense (income) (a)

 

 

 

 

 

0.01

 

 

 

 

 

 

(0.01

)

Corporate strategic costs (b)

 

 

0.01

 

 

 

 

 

 

0.03

 

 

 

 

Corporate contingent consideration adjustment (c)

 

 

(0.01

)

 

 

 

 

 

(0.01

)

 

 

 

Harsco Environmental segment severance costs (d)

 

 

0.01

 

 

 

 

 

 

0.01

 

 

 

 

Harsco Environmental net gain on lease incentive (e)

 

 

 

 

 

 

 

 

(0.12

)

 

 

 

Harsco Environmental property, plant and equipment impairment charge, net of noncontrolling interest (f)

 

 

 

 

 

 

 

 

0.10

 

 

 

 

Harsco Environmental accounts receivable provision (g)

 

 

0.07

 

 

 

 

 

 

0.07

 

 

 

 

Clean Earth segment goodwill impairment charge (h)

 

 

 

 

 

 

 

 

 

 

 

1.32

 

Clean Earth segment severance costs (i)

 

 

 

 

 

0.01

 

 

 

 

 

 

0.03

 

Clean Earth segment contingent consideration adjustments (j)

 

 

 

 

 

(0.01

)

 

 

 

 

 

(0.01

)

Taxes on above unusual items (k)

 

 

 

 

 

 

 

 

0.07

 

 

 

(0.04

)

Adjusted diluted earnings (loss) per share from continuing operations, including acquisition amortization expense

 

 

(0.02

)

(m)

 

0.02

 

 

 

(0.26

)

(m)

 

(0.14

)

Acquisition amortization expense, net of tax (l)

 

 

0.07

 

 

 

0.08

 

 

 

0.21

 

 

 

0.23

 

Adjusted diluted earnings (loss) per share from continuing operations

 

$

0.05

 

 

$

0.10

 

 

$

(0.05

)

 

$

0.09

 

 

  • Costs incurred at Corporate to amend the Company's Senior Secured Credit Facilities, partially offset by a gain on the repurchase of $25.0 million of Senior Notes (Q3 2022 $1.1 million pre-tax expense; nine months 2022 $0.5 million pre-tax income).

  • Certain strategic costs incurred at Corporate associated with supporting and executing the Company's long-term strategies (Q3 2023 $1.0 million pre-tax expense; nine months ended 2023 $2.3 million pre-tax expense). 2022 included the relocation of the Company's headquarters, in addition to other certain strategic costs incurred at Corporate (Q3 2022 $0.3 million pre-tax expense; nine months 2022 $0.1 million pre-tax expense).

  • Adjustment related to a previously recorded liability related to a contingent consideration from the Company's acquisition of Clean Earth (Q3 2023 and nine months ended 2023 $0.8 million pre-tax income).

  • Severance and related costs incurred in the Harsco Environmental segment (Q3 2023 and nine months ended 2023 $1.1 million pre-tax expense).

  • Net gain recognized for a lease modification that resulted in a lease incentive for the Company for a site relocation prior the end of the expected lease term (nine months ended 2023 $9.8 million pre-tax income).

  • Non-cash property, plant and equipment impairment charge related to abandoned equipment at a Harsco Environmental site, net of noncontrolling interest impact (nine months ended 2023 net $7.9 million, which includes $14.1 million pre-tax expense, net of $6.2 million that represents the noncontrolling partner's share of the impairment charge).

  • Accounts receivable provision related to a customer in the Middle East (Q3 2023 and nine months ended 2023 $5.3 million pre-tax expense).

  • Non-cash goodwill impairment charge in the Clean Earth segment (nine months 2022 $104.6 million pre-tax expense).

  • Severance and related costs incurred in the Clean Earth segment (Q3 2022 $1.1 million pre-tax expense; nine months 2022 $2.5 million pre-tax expense).

  • Adjustment to a contingent consideration related to an acquisition in the Clean Earth segment (Q3 2022 and nine months 2022 $0.8 million pre-tax income).

  • Unusual items are tax-effected at the global effective tax rate, before discrete items, in effect at the time the unusual item is recorded.

  • Pre-tax acquisition amortization expense was $7.4 million and $7.7 million in Q3 2023 and 2022, respectively, and after-tax was $5.7 million and $6.0 million in Q3 2023 and 2022, respectively. Pre-tax acquisition amortization expense was $21.5 million and $23.4 million for the nine months ended 2023 and 2022, respectively, and after-tax was $16.6 million and $18.4 million for the nine months ended 2023 and 2022, respectively.

  • Does not total due to rounding.


ENVIRI CORPORATION
RECONCILIATION OF PROJECTED ADJUSTED DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS TO DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS (a) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Projected

 

Projected

 

 

 

Three Months Ending

 

Twelve Months Ending

 

 

 

December 31

 

December 31

 

 

 

 

2023

 

 

 

2023

 

 

 

 

Low

 

High

 

Low

 

High

 

Diluted earnings (loss) per share from continuing operations

 

$

(0.19

)

 

$

(0.10

)

 

$

(0.59

)

 

$

(0.50

)

 

Corporate strategic costs

 

 

 

 

 

 

 

 

0.03

 

 

 

0.03

 

 

Corporate contingent consideration adjustment

 

 

 

 

 

 

 

 

(0.01

)

 

 

(0.01

)

 

Harsco Environmental segment severance costs

 

 

 

 

 

 

 

 

0.01

 

 

 

0.01

 

 

Harsco Environmental segment net gain on lease incentive

 

 

 

 

 

 

 

 

(0.12

)

 

 

(0.12

)

 

Harsco Environmental property, plant and equipment impairment charge, net of noncontrolling interest

 

 

 

 

 

 

 

 

0.10

 

 

 

0.10

 

 

Harsco Environmental accounts receivable provision

 

 

 

 

 

 

 

 

0.07

 

 

 

0.07

 

 

Taxes on above unusual items

 

 

 

 

 

 

 

 

0.07

 

 

 

0.07

 

 

Adjusted diluted earnings (loss) per share from continuing operations, including acquisition amortization expense

 

 

(0.19

)

 

 

(0.10

)

 

 

(0.45

)

(b)

 

(0.36

)

(b)

Estimated acquisition amortization expense, net of tax

 

 

0.07

 

 

 

0.07

 

 

 

0.28

 

 

 

0.28

 

 

Adjusted diluted earnings (loss) per share from continuing operations

 

$

(0.12

)

 

$

(0.03

)

 

$

(0.17

)

(b)

$

(0.08

)

 

 

  • Excludes Harsco Rail Segment.

  • Does not total due to rounding.


ENVIRI CORPORATION
RECONCILIATION OF ADJUSTED EBITDA BY SEGMENT TO OPERATING INCOME (LOSS) AS REPORTED BY SEGMENT (Unaudited)

(In thousands)

 

Harsco
Environmental

 

Clean Earth

 

Corporate

 

Consolidated
Totals

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2023:

 

 

 

 

 

 

Operating income (loss), as reported

 

$

17,867

 

 

$

21,497

 

 

$

(9,589

)

 

$

29,775

 

Corporate strategic costs

 

 

 

 

 

 

 

 

987

 

 

 

987

 

Corporate contingent consideration adjustment

 

 

 

 

 

 

 

 

(828

)

 

 

(828

)

Harsco Environmental segment severance costs

 

 

1,146

 

 

 

 

 

 

 

 

 

1,146

 

Harsco Environmental accounts receivable provision

 

 

5,284

 

 

 

 

 

 

 

 

 

5,284

 

Operating income (loss) excluding unusual items

 

 

24,297

 

 

 

21,497

 

 

 

(9,430

)

 

 

36,364

 

Depreciation

 

 

28,793

 

 

 

6,054

 

 

 

550

 

 

 

35,397

 

Amortization

 

 

1,013

 

 

 

6,330

 

 

 

 

 

 

7,343

 

Adjusted EBITDA

 

$

54,103

 

 

$

33,881

 

 

$

(8,880

)

 

$

79,104

 

Revenues as reported

 

$

285,877

 

 

$

238,711

 

 

 

 

$

524,588

 

Adjusted EBITDA margin (%)

 

 

18.9

%

 

 

14.2

%

 

 

 

 

15.1

%

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2022:

 

 

 

 

 

 

Operating income (loss), as reported

 

$

22,117

 

 

$

17,315

 

 

$

(9,309

)

 

$

30,123

 

Corporate strategic costs

 

 

 

 

 

 

 

 

346

 

 

 

346

 

Clean Earth segment severance costs

 

 

 

 

 

1,092

 

 

 

 

 

 

1,092

 

Clean Earth contingent consideration adjustment

 

 

 

 

 

(827

)

 

 

 

 

 

(827

)

Operating income (loss) excluding unusual items

 

 

22,117

 

 

 

17,580

 

 

 

(8,963

)

 

 

30,734

 

Depreciation

 

 

26,772

 

 

 

4,576

 

 

 

544

 

 

 

31,892

 

Amortization

 

 

1,619

 

 

 

6,071

 

 

 

 

 

 

7,690

 

Adjusted EBITDA

 

$

50,508

 

 

$

28,227

 

 

$

(8,419

)

 

$

70,316

 

Revenues as reported

 

$

264,717

 

 

$

222,197

 

 

 

 

$

486,914

 

Adjusted EBITDA margin (%)

 

 

19.1

%

 

 

12.7

%

 

 

 

 

14.4

%



ENVIRI CORPORATION
RECONCILIATION OF ADJUSTED EBITDA BY SEGMENT TO OPERATING INCOME (LOSS) AS REPORTED BY SEGMENT (Unaudited)

(In thousands)

 

Harsco
Environmental

 

Clean Earth

 

Corporate

 

Consolidated
Totals

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2023:

 

 

 

 

 

 

 

 

Operating income (loss), as reported

 

$

52,885

 

 

$

61,002

 

 

$

(30,792

)

 

$

83,095

 

Corporate strategic costs

 

 

 

 

 

 

 

 

2,253

 

 

 

2,253

 

Corporate contingent consideration adjustment

 

 

 

 

 

 

 

 

(828

)

 

 

(828

)

Harsco Environmental segment severance costs

 

 

1,146

 

 

 

 

 

 

 

 

 

1,146

 

Harsco Environmental segment net gain on lease incentive

 

 

(9,782

)

 

 

 

 

 

 

 

 

(9,782

)

Harsco Environmental property, plant and equipment impairment charge

 

 

14,099

 

 

 

 

 

 

 

 

 

14,099

 

Harsco Environmental accounts receivable provision

 

 

5,284

 

 

 

 

 

 

 

 

 

5,284

 

Operating income (loss) excluding unusual items

 

 

63,632

 

 

 

61,002

 

 

 

(29,367

)

 

 

95,267

 

Depreciation

 

 

84,707

 

 

 

16,528

 

 

 

1,658

 

 

 

102,893

 

Amortization

 

 

3,020

 

 

 

18,472

 

 

 

 

 

 

21,492

 

Adjusted EBITDA

 

 

151,359

 

 

 

96,002

 

 

 

(27,709

)

 

 

219,652

 

Revenues as reported

 

$

848,659

 

 

$

691,750

 

 

 

 

$

1,540,409

 

Adjusted EBITDA margin (%)

 

 

17.8

%

 

 

13.9

%

 

 

 

 

14.3

%

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2022:

 

 

 

 

 

 

Operating income (loss), as reported

 

$

63,931

 

 

$

(95,650

)

 

$

(27,413

)

 

$

(59,132

)

Corporate strategic costs

 

 

 

 

 

 

 

 

128

 

 

 

128

 

Clean Earth segment goodwill impairment charge

 

 

 

 

 

104,580

 

 

 

 

 

 

104,580

 

Clean Earth segment severance costs

 

 

 

 

 

2,540

 

 

 

 

 

 

2,540

 

Clean Earth segment contingent consideration adjustment

 

 

 

 

 

(827

)

 

 

 

 

 

(827

)

Operating income (loss) excluding unusual items

 

 

63,931

 

 

 

10,643

 

 

 

(27,285

)

 

 

47,289

 

Depreciation

 

 

82,311

 

 

 

14,213

 

 

 

1,435

 

 

 

97,959

 

Amortization

 

 

5,161

 

 

 

18,277

 

 

 

 

 

 

23,438

 

Adjusted EBITDA

 

 

151,403

 

 

 

43,133

 

 

 

(25,850

)

 

 

168,686

 

Revenues as reported

 

$

804,367

 

 

$

616,396

 

 

 

 

$

1,420,763

 

Adjusted EBITDA margin (%)

 

 

18.8

%

 

 

7.0

%

 

 

 

 

11.9

%



ENVIRI CORPORATION
RECONCILIATION OF CONSOLIDATED ADJUSTED EBITDA TO CONSOLIDATED INCOME (LOSS) FROM CONTINUING OPERATIONS AS REPORTED (Unaudited)

 

 

 

 

Three Months Ended September 30

(In thousands)

 

 

2023

 

 

 

2022

 

Consolidated income (loss) from continuing operations

 

$

(7,787

)

 

$

1,427

 

 

 

 

 

 

Add back (deduct):

 

 

 

 

Equity in (income) loss of unconsolidated entities, net

 

 

151

 

 

 

128

 

Income tax (benefit) expense

 

 

4,109

 

 

 

9,376

 

Defined benefit pension expense (income)

 

 

5,436

 

 

 

(2,118

)

Facility fees and debt-related expense (income)

 

 

2,806

 

 

 

2,511

 

Interest expense

 

 

26,739

 

 

 

19,751

 

Interest income

 

 

(1,679

)

 

 

(952

)

Depreciation

 

 

35,397

 

 

 

31,892

 

Amortization

 

 

7,343

 

 

 

7,690

 

 

 

 

 

 

Unusual items:

 

 

 

 

Corporate strategic costs

 

 

987

 

 

 

346

 

Corporate contingent consideration adjustment

 

 

(828

)

 

 

 

Harsco Environmental segment severance costs

 

 

1,146

 

 

 

 

Harsco Environmental accounts receivable provision

 

 

5,284

 

 

 

 

Clean Earth segment severance costs

 

 

 

 

 

1,092

 

Clean Earth segment contingent consideration adjustment

 

 

 

 

 

(827

)

Consolidated Adjusted EBITDA

 

$

79,104

 

 

$

70,316

 



ENVIRI CORPORATION
RECONCILIATION OF ADJUSTED EBITDA TO CONSOLIDATED INCOME (LOSS) FROM CONTINUING OPERATIONS AS REPORTED (Unaudited)

 

 

 

 

Nine Months Ended
September 30

(In thousands)

 

 

2023

 

 

 

2022

 

Consolidated income (loss) from continuing operations

 

$

(35,016

)

 

$

(110,352

)

 

 

 

 

 

Add back (deduct):

 

 

 

 

Equity in (income) loss of unconsolidated entities, net

 

 

593

 

 

 

373

 

Income tax (benefit) expense

 

 

21,351

 

 

 

7,482

 

Defined benefit pension expense (income)

 

 

16,178

 

 

 

(6,775

)

Facility fee and debt-related expense

 

 

7,899

 

 

 

894

 

Interest expense

 

 

76,791

 

 

 

51,535

 

Interest income

 

 

(4,701

)

 

 

(2,289

)

Depreciation

 

 

102,893

 

 

 

97,959

 

Amortization

 

 

21,492

 

 

 

23,438

 

 

 

 

 

 

Unusual items:

 

 

 

 

Corporate strategic costs

 

 

2,253

 

 

 

128

 

Corporate contingent consideration adjustment

 

 

(828

)

 

 

 

Harsco Environmental segment severance costs

 

 

1,146

 

 

 

 

Harsco Environmental segment net gain on lease incentive

 

 

(9,782

)

 

 

 

Harsco Environmental property, plant and equipment impairment charge

 

 

14,099

 

 

 

 

Harsco Environmental accounts receivable provision

 

 

5,284

 

 

 

 

Clean Earth segment goodwill impairment charge

 

 

 

 

 

104,580

 

Clean Earth segment severance costs

 

 

 

 

 

2,540

 

Clean Earth segment contingent consideration adjustments

 

 

 

 

 

(827

)

Adjusted EBITDA

 

$

219,652

 

 

$

168,686

 



ENVIRI CORPORATION
RECONCILIATION OF PROJECTED CONSOLIDATED ADJUSTED EBITDA TO PROJECTED CONSOLIDATED INCOME FROM CONTINUING OPERATIONS (a)
(Unaudited)

 

 

 

Projected

 

Projected

 

 

 

Three Months Ending

 

Twelve Months Ending

 

 

 

December 31

 

December 31

 

 

 

 

2023

 

 

 

2023

 

 

(In millions)

 

Low

 

High

 

Low

 

High

 

Consolidated loss from continuing operations

 

$

(15

)

 

$

(7

)

 

$

(49

)

 

$

(41

)

 

 

 

 

 

 

 

 

 

 

 

Add back (deduct):

 

 

 

 

 

 

 

 

 

Income tax (income) expense

 

 

1

 

 

 

2

 

 

 

22

 

 

 

23

 

 

Facility fees and debt-related (income) expense

 

 

3

 

 

 

3

 

 

 

11

 

 

 

10

 

 

Net interest

 

 

25

 

 

 

24

 

 

 

97

 

 

 

97

 

 

Defined benefit pension (income) expense

 

 

6

 

 

 

5

 

 

 

22

 

 

 

21

 

 

Depreciation and amortization

 

 

43

 

 

 

43

 

 

 

167

 

 

 

167

 

 

 

 

 

 

 

 

 

 

 

 

Unusual items:

 

 

 

 

 

 

 

 

 

Corporate strategic costs

 

 

 

 

 

 

 

 

2

 

 

 

2

 

 

Corporate contingent consideration adjustment

 

 

 

 

 

 

 

 

(1

)

 

 

(1

)

 

Harsco Environmental segment severance costs

 

 

 

 

 

 

 

 

1

 

 

 

1

 

 

Harsco Environmental net gain on lease incentive

 

 

 

 

 

 

 

 

(10

)

 

 

(10

)

 

Harsco Environmental property, plant and equipment impairment charge

 

 

 

 

 

 

 

 

14

 

 

 

14

 

 

Harsco Environmental accounts receivable provision

 

 

 

 

 

 

 

 

5

 

 

 

5

 

 

Consolidated Adjusted EBITDA

 

$

62

 

(b)

$

69

 

(b)

$

282

 

(b)

$

289

 

(b)

 

  • Excludes former Harsco Rail Segment

  • Does not total due to rounding.


ENVIRI CORPORATION
RECONCILIATION OF FREE CASH FLOW TO NET CASH PROVIDED BY OPERATING ACTIVITIES (Unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

September 30

(In thousands)

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Net cash provided (used) by operating activities

 

$

17,982

 

 

$

13,422

 

 

$

46,172

 

 

$

131,161

 

Less capital expenditures

 

 

(27,289

)

 

 

(39,854

)

 

 

(93,630

)

 

 

(101,645

)

Less expenditures for intangible assets

 

 

(51

)

 

 

(47

)

 

 

(478

)

 

 

(147

)

Plus capital expenditures for strategic ventures (a)

 

 

507

 

 

 

920

 

 

 

2,458

 

 

 

1,428

 

Plus total proceeds from sales of assets (b)

 

 

641

 

 

 

1,698

 

 

 

2,080

 

 

 

8,289

 

Plus transaction-related expenditures (c)

 

 

917

 

 

 

758

 

 

 

1,045

 

 

 

1,854

 

Harsco Rail free cash flow deficit/(benefit)

 

 

17,452

 

 

 

(8,161

)

 

 

41,137

 

 

 

30,827

 

Free cash flow

 

$

10,159

 

 

$

(31,264

)

 

$

(1,216

)

 

$

71,767

 

 

  • Capital expenditures for strategic ventures represent the partner’s share of capital expenditures in certain ventures consolidated in the Company’s condensed consolidated financial statements.

  • Asset sales are a normal part of the business model, primarily for the Harsco Environmental segment.

  • Expenditures directly related to the Company's divestiture transactions and other strategic costs incurred at Corporate.


ENVIRI CORPORATION
RECONCILIATION OF PROJECTED FREE CASH FLOW TO PROJECTED NET CASH PROVIDED BY OPERATING ACTIVITIES (a)(Unaudited)

 

 

Projected
Twelve Months Ending
December 31

 

 

 

2023

 

(In millions)

 

Low