Clean Harbors, Inc. (�Clean Harbors�) (NASDAQ: CLHB), the leading
provider of environmental and hazardous waste management services
throughout North America, today announced financial results for the
fourth quarter and year ended December 31, 2007. For the fourth
quarter of 2007, Clean Harbors reported an 11 percent increase in
revenue to a record $257.7 million from $231.8 million in the
fourth quarter of 2006. Income from operations rose 27 percent to
$25.1 million from $19.8 million in the fourth quarter of 2006.
Fourth quarter 2007 net income attributable to common shareholders
increased 45 percent to $16.6 million, or $0.81 per diluted share,
from $11.4 million, or $0.56 per diluted share, in the fourth
quarter of 2006. EBITDA (see description below) increased 20
percent to $37.6 million in the fourth quarter of 2007, from $31.4
million in the comparable period of 2006. The Company�s
fourth-quarter 2007 EBITDA includes a negative $2.9 million net
change in estimated environmental liabilities. Comments on the
Fourth Quarter �Clean Harbors concluded a successful 2007 with
another record-breaking quarter, delivering double-digit growth in
sales and EBITDA,� said Alan S. McKim, Chairman and Chief Executive
Officer. �Our results underscore the significant leverage within
our network of disposal facilities. By combining steady sales
growth with stringent cost management, we delivered a 20 percent
growth in EDITDA on an 11 percent increase in revenue. Strong
contributions from both Technical Services and Site Services helped
fuel fourth-quarter revenue of nearly $258 million and EBITDA of
$37.6 million.� �Our Technical Services business sustained its
momentum as we achieved a favorable product mix and continued to
win large scale projects that drive substantial volumes to our
disposal facilities,� McKim said. �Utilization rates at our
incinerators remained high in the quarter, particularly in the
U.S., where we achieved utilization of 95 percent. Our landfill
business reflected the seasonally lower volumes typical in the
fourth quarter of the year, and remained flat year-over-year.�
�Within our Site Services segment, our growth was primarily driven
by our core industrial cleaning and maintenance services, which is
supported by our ongoing geographic expansion,� McKim said. �In the
fourth quarter, we opened a service center in Arizona bringing our
total service center openings for 2007 to eight. We surpassed our
initial goal of opening five to six service locations in 2007 and
expanded our reach nationwide, entering previously under-penetrated
markets in the Pacific Northwest and the Southwest. In addition to
the growth in our core Site Services business, we also benefited
from $4.5 million in emergency response and small scale project
revenue, with the majority resulting from the clean-up associated
with the Cosco Busan oil spill in the San Francisco Bay in
November.� Full-Year 2007 Results Revenues for the year ended
December 31, 2007 increased 14 percent to $946.9 million, compared
with $829.8 million for full-year 2006. Income from operations for
full-year 2007 increased 15 percent to $85.3 million versus $74.4
million in the prior year. EBITDA (see description below) for 2007
increased 11 percent to $133.3 million from $119.9 million for
2006. The Company generated net income attributable to common
shareholders of $44.0 million, or $2.14 per diluted share, for the
full-year 2007. This compares with 2006 net income attributable to
common shareholders of $46.4 million, or $2.26 per diluted share.
The Company concluded 2007 with cash and marketable securities of
$120.4 million, up from $83.8 million at December 31, 2006 and
$103.1 million at September 30, 2007. Non-GAAP Fourth-Quarter and
Full-Year Results Clean Harbors reports EBITDA results, which are
non-GAAP financial measures, as a complement to results provided in
accordance with accounting principles generally accepted in the
United States (GAAP) and believes that such information provides
additional useful information to investors since the Company�s loan
covenants are based upon levels of EBITDA achieved. The Company
defines EBITDA in accordance with its outstanding credit agreement,
as described in the following reconciliation showing the
differences between reported net income and EBITDA for 2007 and
2006 (in thousands): � For the three months ended: � � For the year
ended: December 31, � December 31, December 31, � December 31, 2007
2006 2007 2006 Net income $ 16,569 $ 11,493 $ 44,198 $ 46,675
Accretion of environmental liabilities 2,704 2,587 10,447 10,220
Depreciation and amortization 9,789 9,043 37,590 35,339 Loss on
early extinguishment of debt � 239 � 8,529 Interest expense, net
3,256 3,144 13,157 12,447 Provision for income taxes 5,349 4,760
28,040 6,339 Other (income) expense (73 ) 174 (135 ) 447 Equity
interest in joint venture � � � � (50 ) � � � � (61 ) EBITDA $
37,594 � $ 31,390 � $ 133,297 � $ 119,935 � Extension of 10-K
Filing Date This is the first year for which the Company is
classified as a �large accelerated filer� and is therefore
required, subject to permitted extensions, to file its Annual
Report on Form 10-K within 60, rather than 75, days after December
31. 2007. As permitted by SEC�rules, the Company plans to file a
notification with the SEC on Form 12b-25 that it will file its
Annual Report on Form 10-K no later than March 14, 2008. All of the
financial statement information contained in this press release are
unaudited. Acquisition of Solvent Recovery Facilities The Company
also announced that it signed on February 8, 2008, definitive
agreements to acquire two solvent recycling facilities in Chicago,
Illinois and Hebron, Ohio and the business associated with those
facilities for $12.5 million in cash, plus the assumption of
approximately $3 million of environmental liabilities, from
Safety-Kleen Systems, Inc. The Company will also offer employment
to all existing employees of these facilities. These two solvent
recovery facilities generated positive EBITDA and approximately $16
million in revenue during 2007. In conjunction with this
transaction, Clean Harbors has formed two new entities within its
organization � Clean Harbors Recycling Services of Ohio, LLC and
Clean Harbors Recycling Services of Chicago, LLC. The closing of
the acquisition is subject to certain conditions, including the
receipt of certain governmental approvals. The Company anticipates
receiving the governmental approvals and closing the acquisition by
the end of March 2008. �This acquisition will broaden Clean
Harbors� service portfolio and establish a substantial presence for
us in the solvent recycling market,� said McKim. �We believe these
two locations will be valuable additions to our extensive network
of waste management facilities going forward. As the costs of
solvents continue to rise, corporations are increasingly turning to
recycling spent solvents for reuse. In acquiring these two
recycling facilities and constructing our own solvent recovery
plant at our El Dorado location, we are now better positioned to
offer our customers a broad spectrum of choices for addressing
their solvent waste streams. We currently expect the acquisition of
the two facilities from Safety-Kleen to be accretive to earnings
during 2008.� Business Outlook and Financial Guidance �We are
encouraged about our top- and bottom-line prospects for 2008,� said
McKim. �With significant momentum, favorable industry trends and
our established position as the leader in the environmental
services sector, we expect that 2008 will be another record year
for Clean Harbors. In 2008, we anticipate achieving our long-stated
goal of becoming a $1 billion organization. Based on the operating
leverage inherent in our network of disposal facilities, we believe
we can grow our EBITDA at a significantly higher rate than our
revenues in 2008.� The first quarter is traditionally the slowest
quarter of the year for Clean Harbors due to the effect of weather
on the Company�s plants and customers� operations. For the first
quarter of 2008, the Company expects revenue in the range of $225
million to $230 million. The Company expects to generate EBITDA for
the first quarter of 2008 in the range of $27 million to $29
million. For the full-year 2008, the Company expects to increase
revenues in the range of 6 percent to 8 percent, and achieve EBITDA
growth in the range of 17 percent to 20 percent. Conference Call
Information Clean Harbors will conduct a conference call for
investors to discuss the information contained in this press
release today, Wednesday, February 27, 2008 at 9:00 a.m. (ET).
Investors who want to hear a webcast of the call should log onto
www.cleanharbors.com and select �Investor Relations.� In addition,
if you are unable to listen to the live webcast, the call will be
archived on the investor section of the website. Those who wish to
listen to the fourth-quarter and year-end 2007 conference call
webcast should visit the Investor Relations section of the
Company�s website at www.cleanharbors.com. The live call also can
be accessed by dialing 877.795.3648 or 719.325.4820 (confirmation
code: 4232606) prior to the start of the call. If you are unable to
listen to the live call, the webcast will be archived on the
Company�s website. About Clean Harbors, Inc. Clean Harbors, Inc. is
North America's leading provider of environmental and hazardous
waste management services. With an unmatched infrastructure of 49
waste management facilities, including nine landfills, six
incineration locations and six wastewater treatment centers, the
Company provides essential services to over 45,000 customers,
including more than 325 Fortune 500 companies, thousands of smaller
private entities and numerous federal, state and local governmental
agencies. Headquartered in Norwell, Massachusetts, Clean Harbors
has more than 100 locations strategically positioned throughout
North America in 36 U.S. states, six Canadian provinces, Mexico and
Puerto Rico. For more information, visit www.cleanharbors.com. Safe
Harbor Statement Any statements contained herein that are not
historical facts are forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995, and
involve risks and uncertainties. These forward-looking statements
are generally identifiable by use of the words �believes,�
�expects,� �intends,� �anticipates,� �plans to,� �estimates,�
�projects,� or similar expressions. These forward-looking
statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those
reflected in these forward-looking statements. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which reflect management�s opinions only as of the date
hereof. The Company undertakes no obligation to revise or publicly
release the results of any revision to these forward-looking
statements other than through its various filings with the
Securities and Exchange Commission. Furthermore, all financial
information in this press release is based on preliminary data and
is subject to the final closing of the Company�s books and records.
A variety of factors beyond the control of the Company may affect
the Company�s performance, including, but not limited to: The
Company�s ability to manage the significant environmental
liabilities that it assumed in connection with the CSD and other
acquisitions; The availability and costs of liability insurance and
financial assurance required by governmental entities relating to
our facilities; The effects of general economic conditions in the
United States, Canada and other territories and countries where the
Company does business; The effect of economic forces and
competition in specific marketplaces where the Company competes;
The possible impact of new regulations or laws pertaining to all
activities of the Company�s operations; The outcome of litigation
or threatened litigation or regulatory actions; The effect of
commodity pricing on overall revenues and profitability; Possible
fluctuations in quarterly or annual results or adverse impacts on
the Company�s results caused by the adoption of new accounting
standards or interpretations or regulatory rules and regulations;
The effect of weather conditions or other aspects of the forces of
nature on field or facility operations; The effects of industry
trends in the environmental services and waste handling
marketplace; and The effects of conditions in the financial
services industry on the availability of capital and financing. Any
of the above factors and numerous others not listed nor foreseen
may adversely impact the Company�s financial performance.
Additional information on the potential factors that could affect
the Company�s actual results of operations is included in its
filings with the Securities and Exchange Commission, which may be
viewed on the Investor portal of the Company�s Web Page at
www.cleanharbors.com. CLEAN HARBORS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS Unaudited (in thousands
except per share amounts) � � For the three months ended: Year
ended: December 31, � December 31, December 31, � December 31, 2007
2006 2007 2006 Revenues $257,678 $231,849 $946,917 $829,809 Cost of
revenues 178,547 165,907 664,440 584,835 Selling, general and
administrative expenses 41,537 34,552 149,180 125,039 Accretion of
environmental liabilities 2,704 2,587 10,447 10,220 Depreciation
and amortization 9,789 9,043 37,590 35,339 Income from operations
25,101 19,760 85,260 74,376 Other income (expense) 73 (174) 135
(447) Loss on early extinguishment of debt � (239) � (8,529)
Interest expense, net (3,256) (3,144) (13,157) (12,447) Income
before provision for income taxes and equity interest in joint
venture � 21,918 16,203 72,238 52,953 Provision for income taxes
5,349 4,760 28,040 6,339 Equity interest in joint venture � (50) �
(61) Net income 16,569 11,493 44,198 46,675 Dividends on Series B
Preferred Stock � 69 206 276 Net income attributable to common
shareholders $16,569 $11,424 $43,992 $46,399 Earnings per share:
Basic earnings attributable to common shareholders $0.83 $0.58
$2.22 $2.38 Diluted earnings attributable to common shareholders
$0.81 $0.56 $2.14 $2.26 Weighted average common shares outstanding
19,946 19,634 19,827 19,526 Weighted average common shares
outstanding plus potentially dilutive common shares � 20,582 20,637
20,630 20,657 CLEAN HARBORS, INC. AND SUBSIDIARIES UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS ASSETS (in thousands) �
December 31, December 31, 2007 2006 Current assets: Cash and cash
equivalents $ 119,538 $ 73,550 Marketable securities 850 10,240
Accounts receivable, net 193,126 169,581 Unbilled accounts
receivable 14,703 16,078 Deferred costs 7,359 7,140 Prepaid
expenses and other current assets 10,098 9,451 Supplies inventories
22,363 20,101 Deferred tax assets 11,491 9,238 Properties held for
sale � 910 � 7,440 Total current assets � 380,438 � 322,819
Property, plant and equipment, net � 262,601 � 244,126 Other
assets: Long term investments 8,500 - Deferred financing costs
5,881 7,206 Goodwill 21,572 19,032 Permits and other intangibles,
net 74,809 65,743 Investment in joint venture � 2,208 Deferred tax
assets 12,176 6,388 Other � 3,911 � 3,286 � 126,849 � 103,863 Total
assets $ 769,888 $ 670,808 CLEAN HARBORS, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS LIABILITIES AND
STOCKHOLDERS�EQUITY (in thousands) � December 31, December 31, 2007
2006 Current liabilities: Uncashed checks $ 5,489 $ 11,083 Current
portion of capital lease obligations 1,251 1,391 Accounts payable
81,309 81,432 Deferred revenue 29,730 29,409 Other accrued expenses
65,789 56,999 Current portion of closure, post-closure and remedial
liabilities 18,858 13,707 Income taxes payable � 8,427 � 4,333
Total current liabilities � 210,853 � 198,354 Other liabilities:
Closure and post-closure liabilities, less current portion 24,202
23,520 Remedial liabilities, less current portion 141,428 136,173
Long-term obligations, less current maturities 120,712 120,522
Capital lease obligations, less current portion 1,520 2,648 Tax
contingencies and other long-term liabilities � 68,276 � 16,405
Total other liabilities � 356,138 � 299,268 Total stockholders�
equity, net � 202,897 � 173,186 Total liabilities and stockholders�
equity $ 769,888 $ 670,808
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