Investor Contact David Martin 717.612.5628 damartin@harsco.com | Media Contact Jay Cooney 717.730.3683 jcooney@harsco.com |
($ in millions, except per share amounts) | Q3 2022 | Q3 2021 | ||||||||||||
Revenues | $ | 487 | $ | 470 | ||||||||||
Operating income from continuing operations - GAAP | $ | 30 | $ | 27 | ||||||||||
Diluted EPS from continuing operations - GAAP | $ | 0.01 | $ | 0.06 | ||||||||||
Adjusted EBITDA - Non GAAP | $ | 70 | $ | 68 | ||||||||||
Adjusted EBITDA margin - Non GAAP | 14.4 | % | 14.4 | % | ||||||||||
Adjusted diluted EPS - Non GAAP | $ | 0.10 | $ | 0.15 | ||||||||||
($ in millions) | Q3 2022 | Q3 2021 | ||||||||||||
Revenues | $ | 265 | $ | 270 | ||||||||||
Operating income - GAAP | $ | 22 | $ | 28 | ||||||||||
Adjusted EBITDA - Non GAAP | $ | 51 | $ | 56 | ||||||||||
Adjusted EBITDA margin - Non GAAP | 19.1 | % | 20.7 | % | ||||||||||
($ in millions) | Q3 2022 | Q3 2021 | ||||||||||||
Revenues | $ | 222 | $ | 200 | ||||||||||
Operating income (loss) - GAAP | $ | 17 | $ | 10 | ||||||||||
Adjusted EBITDA - Non GAAP | $ | 28 | $ | 21 | ||||||||||
Adjusted EBITDA margin - Non GAAP | 12.7 | % | 10.2 | % |
2022 Full Year Outlook (Continuing Operations) | Current | August Outlook | ||||||
GAAP Operating Income/(Loss) | $(44) - $(51) million | $(53) - $(63) million | ||||||
Adjusted EBITDA | $216 - $223 million | $210 - $220 million | ||||||
GAAP Diluted Earnings/(Loss) Per Share | $(1.52) - $(1.62) | $(1.58) - $(1.72) | ||||||
Adjusted Diluted Earnings/(Loss) Per Share | $(0.02) - $0.08 | $0.00 - $(0.13) | ||||||
Free Cash Flow | $90 - $100 million | $115 - $125 million | ||||||
Net Interest Expense | $70 - $71 million | $68 - $70 million | ||||||
Pension Income (Non-Operating) | $8 million | $9 million | ||||||
Net Capital Expenditures | $120 - $125 million | $125 - $130 million | ||||||
Q4 2022 Outlook (Continuing Operations) | ||||||||
GAAP Operating Income | $8 - $15 million | |||||||
Adjusted EBITDA | $47 - $54 million | |||||||
GAAP Diluted Earnings/(Loss) Per Share | $(0.10) - $(0.19) | |||||||
Adjusted Diluted Earnings/(Loss) Per Share | $(0.02) - $(0.12) |
HARSCO CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) | |||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
September 30 | September 30 | ||||||||||||||||||||||||||||
(In thousands, except per share amounts) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||
Revenues from continuing operations: | |||||||||||||||||||||||||||||
Service revenues | $ | 442,775 | $ | 430,824 | $ | 1,300,828 | $ | 1,274,814 | |||||||||||||||||||||
Product revenues | 44,139 | 39,561 | 119,935 | 111,510 | |||||||||||||||||||||||||
Total revenues | 486,914 | 470,385 | 1,420,763 | 1,386,324 | |||||||||||||||||||||||||
Costs and expenses from continuing operations: | |||||||||||||||||||||||||||||
Cost of services sold | 357,194 | 344,050 | 1,072,545 | 1,018,885 | |||||||||||||||||||||||||
Cost of products sold | 35,609 | 31,289 | 100,476 | 89,269 | |||||||||||||||||||||||||
Selling, general and administrative expenses | 64,146 | 70,629 | 201,234 | 213,048 | |||||||||||||||||||||||||
Research and development expenses | 193 | 331 | 545 | 811 | |||||||||||||||||||||||||
Goodwill impairment charge | — | — | 104,580 | — | |||||||||||||||||||||||||
Other (income) expenses, net | (351) | (2,835) | 515 | (7,993) | |||||||||||||||||||||||||
Total costs and expenses | 456,791 | 443,464 | 1,479,895 | 1,314,020 | |||||||||||||||||||||||||
Operating income (loss) from continuing operations | 30,123 | 26,921 | (59,132) | 72,304 | |||||||||||||||||||||||||
Interest income | 952 | 544 | 2,289 | 1,668 | |||||||||||||||||||||||||
Interest expense | (19,751) | (15,741) | (51,535) | (47,640) | |||||||||||||||||||||||||
Facility fees and debt-related income (expense) | (2,511) | (198) | (894) | (5,506) | |||||||||||||||||||||||||
Defined benefit pension income | 2,118 | 3,887 | 6,775 | 11,777 | |||||||||||||||||||||||||
Income (loss) from continuing operations before income taxes and equity income | 10,931 | 15,413 | (102,497) | 32,603 | |||||||||||||||||||||||||
Income tax benefit (expense) from continuing operations | (9,376) | (7,816) | (7,482) | (14,714) | |||||||||||||||||||||||||
Equity income (loss) of unconsolidated entities, net | (128) | (293) | (373) | (488) | |||||||||||||||||||||||||
Income (loss) from continuing operations | 1,427 | 7,304 | (110,352) | 17,401 | |||||||||||||||||||||||||
Discontinued operations: | |||||||||||||||||||||||||||||
Income (loss) from discontinued businesses | 1,993 | 1,301 | (35,225) | 12,904 | |||||||||||||||||||||||||
Income tax benefit (expense) from discontinued businesses | (539) | 1,223 | 5,282 | (3,832) | |||||||||||||||||||||||||
Income (loss) from discontinued operations, net of tax | 1,454 | 2,524 | (29,943) | 9,072 | |||||||||||||||||||||||||
Net income (loss) | 2,881 | 9,828 | (140,295) | 26,473 | |||||||||||||||||||||||||
Less: Net (income) loss attributable to noncontrolling interests | (802) | (2,264) | (3,056) | (5,386) | |||||||||||||||||||||||||
Net income (loss) attributable to Harsco Corporation | $ | 2,079 | $ | 7,564 | $ | (143,351) | $ | 21,087 | |||||||||||||||||||||
Amounts attributable to Harsco Corporation common stockholders: | |||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of tax | $ | 625 | $ | 5,040 | $ | (113,408) | $ | 12,015 | |||||||||||||||||||||
Income (loss) from discontinued operations, net of tax | 1,454 | 2,524 | (29,943) | 9,072 | |||||||||||||||||||||||||
Net income (loss) attributable to Harsco Corporation common stockholders | $ | 2,079 | $ | 7,564 | $ | (143,351) | $ | 21,087 | |||||||||||||||||||||
Weighted-average shares of common stock outstanding | 79,531 | 79,287 | 79,469 | 79,214 | |||||||||||||||||||||||||
Basic earnings (loss) per common share attributable to Harsco Corporation common stockholders: | |||||||||||||||||||||||||||||
Continuing operations | $ | 0.01 | $ | 0.06 | $ | (1.43) | $ | 0.15 | |||||||||||||||||||||
Discontinued operations | 0.02 | 0.03 | (0.38) | 0.11 | |||||||||||||||||||||||||
Basic earnings (loss) per share attributable to Harsco Corporation common stockholders | $ | 0.03 | (a) | $ | 0.10 | (a) | $ | (1.80) | (a) | $ | 0.27 | (a) | |||||||||||||||||
Diluted weighted-average shares of common stock outstanding | 79,567 | 80,275 | 79,469 | 80,356 | |||||||||||||||||||||||||
Diluted earnings (loss) per common share attributable to Harsco Corporation common stockholders: | |||||||||||||||||||||||||||||
Continuing operations | $ | 0.01 | $ | 0.06 | $ | (1.43) | $ | 0.15 | |||||||||||||||||||||
Discontinued operations | 0.02 | 0.03 | (0.38) | 0.11 | |||||||||||||||||||||||||
Diluted earnings (loss) per share attributable to Harsco Corporation common stockholders | $ | 0.03 | $ | 0.09 | $ | (1.80) | (a) | $ | 0.26 |
HARSCO CORPORATION CONSOLIDATED BALANCE SHEETS (Unaudited) | ||||||||||||||
(In thousands) | September 30 2022 | December 31 2021 | ||||||||||||
ASSETS | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | 81,740 | $ | 82,908 | ||||||||||
Restricted cash | 3,297 | 4,220 | ||||||||||||
Trade accounts receivable, net | 269,890 | 377,881 | ||||||||||||
Other receivables | 26,307 | 33,059 | ||||||||||||
Inventories | 80,714 | 70,493 | ||||||||||||
Prepaid expenses | 33,592 | 31,065 | ||||||||||||
Current portion of assets held-for-sale | 261,888 | 265,413 | ||||||||||||
Other current assets | 39,617 | 9,934 | ||||||||||||
Total current assets | 797,045 | 874,973 | ||||||||||||
Property, plant and equipment, net | 629,895 | 653,913 | ||||||||||||
Right-of-use assets, net | 104,227 | 101,576 | ||||||||||||
Goodwill | 744,780 | 883,109 | ||||||||||||
Intangible assets, net | 372,002 | 402,801 | ||||||||||||
Deferred income tax assets | 16,681 | 17,883 | ||||||||||||
Assets held-for-sale | 63,864 | 71,234 | ||||||||||||
Other assets | 42,901 | 48,419 | ||||||||||||
Total assets | $ | 2,771,395 | $ | 3,053,908 | ||||||||||
LIABILITIES | ||||||||||||||
Current liabilities: | ||||||||||||||
Short-term borrowings | $ | 9,463 | $ | 7,748 | ||||||||||
Current maturities of long-term debt | 16,784 | 10,226 | ||||||||||||
Accounts payable | 203,900 | 186,126 | ||||||||||||
Accrued compensation | 38,041 | 48,165 | ||||||||||||
Income taxes payable | 4,271 | 6,378 | ||||||||||||
Current portion of operating lease liabilities | 25,989 | 25,590 | ||||||||||||
Current portion of liabilities of assets held-for-sale | 157,231 | 161,999 | ||||||||||||
Other current liabilities | 136,019 | 155,159 | ||||||||||||
Total current liabilities | 591,698 | 601,391 | ||||||||||||
Long-term debt | 1,314,918 | 1,359,446 | ||||||||||||
Retirement plan liabilities | 49,286 | 93,693 | ||||||||||||
Operating lease liabilities | 77,304 | 74,571 | ||||||||||||
Liabilities of assets held-for-sale | 7,437 | 8,492 | ||||||||||||
Environmental liabilities | 26,678 | 28,435 | ||||||||||||
Deferred tax liabilities | 32,497 | 33,826 | ||||||||||||
Other liabilities | 45,442 | 48,284 | ||||||||||||
Total liabilities | 2,145,260 | 2,248,138 | ||||||||||||
HARSCO CORPORATION STOCKHOLDERS’ EQUITY | ||||||||||||||
Common stock | 145,390 | 144,883 | ||||||||||||
Additional paid-in capital | 223,172 | 215,528 | ||||||||||||
Accumulated other comprehensive loss | (596,764) | (560,139) | ||||||||||||
Retained earnings | 1,651,159 | 1,794,510 | ||||||||||||
Treasury stock | (848,439) | (846,622) | ||||||||||||
Total Harsco Corporation stockholders’ equity | 574,518 | 748,160 | ||||||||||||
Noncontrolling interests | 51,617 | 57,610 | ||||||||||||
Total equity | 626,135 | 805,770 | ||||||||||||
Total liabilities and equity | $ | 2,771,395 | $ | 3,053,908 |
HARSCO CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | ||||||||||||||||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||||
(In thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||||||||
Net income (loss) | $ | 2,881 | $ | 9,828 | $ | (140,295) | $ | 26,473 | ||||||||||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||||||||||||||
Depreciation | 31,892 | 33,479 | 97,959 | 98,383 | ||||||||||||||||||||||
Amortization | 8,538 | 8,771 | 25,605 | 26,554 | ||||||||||||||||||||||
Deferred income tax (benefit) expense | (1,660) | (2,504) | (12,056) | (8,911) | ||||||||||||||||||||||
Equity (income) loss of unconsolidated entities, net | 128 | 293 | 373 | 488 | ||||||||||||||||||||||
Dividends from unconsolidated entities | — | — | 526 | — | ||||||||||||||||||||||
(Gain) loss on early extinguishment of debt | — | — | (2,254) | 2,668 | ||||||||||||||||||||||
Goodwill impairment charge | — | — | 104,580 | — | ||||||||||||||||||||||
Other, net | (639) | 1,002 | 381 | (1,147) | ||||||||||||||||||||||
Changes in assets and liabilities, net of acquisitions and dispositions of businesses: | ||||||||||||||||||||||||||
Accounts receivable | (12,613) | (9,079) | 74,994 | (32,563) | ||||||||||||||||||||||
Insurance receivable | — | — | — | — | ||||||||||||||||||||||
Income tax refunds receivable, reimbursable to seller | — | 735 | 7,687 | 735 | ||||||||||||||||||||||
Inventories | (2,904) | (11,899) | (11,339) | 3,557 | ||||||||||||||||||||||
Contract assets | 1,753 | (14,339) | 9,589 | (52,205) | ||||||||||||||||||||||
Right-of-use assets | 7,446 | 7,153 | 21,829 | 21,050 | ||||||||||||||||||||||
Accounts payable | (5,817) | 25,602 | 13,030 | 12,111 | ||||||||||||||||||||||
Accrued interest payable | (6,819) | (7,703) | (7,559) | (7,840) | ||||||||||||||||||||||
Accrued compensation | 325 | 7,397 | (5,559) | 12,098 | ||||||||||||||||||||||
Advances on contracts | 7,639 | (646) | (5,987) | (13,997) | ||||||||||||||||||||||
Operating lease liabilities | (7,403) | (7,048) | (21,498) | (20,554) | ||||||||||||||||||||||
Retirement plan liabilities, net | (6,242) | (8,842) | (27,829) | (36,700) | ||||||||||||||||||||||
Other assets and liabilities | (3,083) | 1,020 | 8,984 | 16,550 | ||||||||||||||||||||||
Net cash provided by operating activities | 13,422 | 33,220 | 131,161 | 46,750 | ||||||||||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||||||||
Purchases of property, plant and equipment | (39,854) | (40,861) | (101,645) | (109,507) | ||||||||||||||||||||||
Proceeds from sales of assets | 1,698 | 5,470 | 8,289 | 15,512 | ||||||||||||||||||||||
Expenditures for intangible assets | (47) | (155) | (147) | (287) | ||||||||||||||||||||||
Proceeds from note receivable | — | — | 8,605 | 6,400 | ||||||||||||||||||||||
Net proceeds (payments) from settlement of foreign currency forward exchange contracts | 8,572 | (86) | 13,571 | (1,064) | ||||||||||||||||||||||
Payments for settlements of interest rate swaps | (463) | — | (2,586) | — | ||||||||||||||||||||||
Other investing activities, net | 67 | 48 | 220 | 181 | ||||||||||||||||||||||
Net cash used by investing activities | (30,027) | (35,584) | (73,693) | (88,765) | ||||||||||||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||||||||
Short-term borrowings, net | 308 | 206 | 277 | 4,650 | ||||||||||||||||||||||
Current maturities and long-term debt: | ||||||||||||||||||||||||||
Additions | 54,468 | 41,950 | 159,429 | 507,468 | ||||||||||||||||||||||
Reductions | (45,970) | (38,870) | (198,831) | (452,351) | ||||||||||||||||||||||
Dividends paid to noncontrolling interests | (4,841) | (9) | (4,841) | (3,103) | ||||||||||||||||||||||
Sale (purchase) of noncontrolling interests | — | — | 1,901 | — | ||||||||||||||||||||||
Stock-based compensation - Employee taxes paid | (119) | (101) | (1,817) | (3,273) | ||||||||||||||||||||||
Payment of contingent consideration | — | (734) | (6,915) | (734) | ||||||||||||||||||||||
Deferred financing costs | — | — | — | (7,828) | ||||||||||||||||||||||
Other financing activities, net | — | — | — | (601) | ||||||||||||||||||||||
Net cash provided (used) by financing activities | 3,846 | 2,442 | (50,797) | 44,228 | ||||||||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents, including restricted cash | (3,011) | (2,262) | (8,762) | (1,779) | ||||||||||||||||||||||
Net increase (decrease) in cash and cash equivalents, including restricted cash | (15,770) | (2,184) | (2,091) | 434 | ||||||||||||||||||||||
Cash and cash equivalents, including restricted cash, at beginning of period | 100,807 | 82,287 | 87,128 | 79,669 | ||||||||||||||||||||||
Cash and cash equivalents, including restricted cash, at end of period | $ | 85,037 | $ | 80,103 | $ | 85,037 | $ | 80,103 |
HARSCO CORPORATION REVIEW OF OPERATIONS BY SEGMENT (Unaudited) | ||||||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||
September 30, 2022 | September 30, 2021 | |||||||||||||||||||||||||
(In thousands) | Revenues | Operating Income (Loss) | Revenues | Operating Income (Loss) | ||||||||||||||||||||||
Harsco Environmental | $ | 264,717 | $ | 22,117 | $ | 269,901 | $ | 27,630 | ||||||||||||||||||
Harsco Clean Earth | 222,197 | 17,315 | 200,484 | 9,893 | ||||||||||||||||||||||
Corporate | — | (9,309) | — | (10,602) | ||||||||||||||||||||||
Consolidated Totals | $ | 486,914 | $ | 30,123 | $ | 470,385 | $ | 26,921 | ||||||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, 2022 | September 30, 2021 | |||||||||||||||||||||||||
(In thousands) | Revenues | Operating Income (Loss) | Revenues | Operating Income (Loss) | ||||||||||||||||||||||
Harsco Environmental | $ | 804,367 | $ | 63,931 | $ | 800,433 | $ | 83,788 | ||||||||||||||||||
Harsco Clean Earth | 616,396 | (95,650) | 585,891 | 20,457 | ||||||||||||||||||||||
Corporate | — | (27,413) | — | (31,941) | ||||||||||||||||||||||
Consolidated Totals | $ | 1,420,763 | $ | (59,132) | $ | 1,386,324 | $ | 72,304 |
HARSCO CORPORATION RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE TO DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS AS REPORTED (Unaudited) | |||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
September 30 | September 30 | ||||||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||
Diluted earnings (loss) per share from continuing operations as reported | $ | 0.01 | $ | 0.06 | $ | (1.43) | $ | 0.15 | |||||||||||||||||||||
Facility fees and debt-related expense (income) (a) | 0.01 | — | (0.01) | 0.07 | |||||||||||||||||||||||||
Corporate strategic costs (b) | — | 0.02 | — | 0.04 | |||||||||||||||||||||||||
Harsco Clean Earth segment goodwill impairment charge (c) | — | — | 1.32 | — | |||||||||||||||||||||||||
Harsco Environmental segment severance (d) | — | (0.01) | — | (0.01) | |||||||||||||||||||||||||
Harsco Clean Earth segment severance costs (e) | 0.01 | — | 0.03 | — | |||||||||||||||||||||||||
Harsco Clean Earth segment contingent consideration adjustments (f) | (0.01) | — | (0.01) | — | |||||||||||||||||||||||||
Taxes on above unusual items (g) | — | — | (0.04) | (0.02) | |||||||||||||||||||||||||
Adjusted diluted earnings (loss) per share, including acquisition amortization expense | 0.02 | (i) | 0.07 | (0.14) | 0.22 | (i) | |||||||||||||||||||||||
Acquisition amortization expense, net of tax (h) | 0.08 | 0.08 | 0.23 | 0.24 | |||||||||||||||||||||||||
Adjusted diluted earnings per share | $ | 0.10 | $ | 0.15 | $ | 0.09 | $ | 0.47 | (i) | ||||||||||||||||||||
HARSCO CORPORATION RECONCILIATION OF PROJECTED ADJUSTED DILUTED EARNINGS (LOSS) PER SHARE TO DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS (a) (Unaudited) | |||||||||||||||||||||||||||||
Projected Three Months Ending December 31 | Projected Twelve Months Ending December 31 | ||||||||||||||||||||||||||||
2022 | 2022 | ||||||||||||||||||||||||||||
Low | High | Low | High | ||||||||||||||||||||||||||
Diluted earnings (loss) per share from continuing operations | $ | (0.19) | $ | (0.10) | $ | (1.62) | $ | (1.52) | |||||||||||||||||||||
Harsco Clean Earth segment goodwill impairment charge | — | — | 1.32 | 1.32 | |||||||||||||||||||||||||
Harsco Clean Earth segment severance costs | — | — | 0.04 | 0.04 | |||||||||||||||||||||||||
Harsco Clean Earth segment contingent consideration adjustments | — | — | (0.01) | (0.01) | |||||||||||||||||||||||||
Facility fees and debt-related expense (income) | — | — | (0.01) | (0.01) | |||||||||||||||||||||||||
Taxes on above unusual items | — | — | (0.04) | (0.04) | |||||||||||||||||||||||||
Adjusted diluted earnings (loss) per share, including acquisition amortization expense | (0.19) | (0.10) | (0.32) | (0.22) | |||||||||||||||||||||||||
Estimated acquisition amortization expense, net of tax | 0.08 | 0.08 | 0.30 | 0.30 | |||||||||||||||||||||||||
Adjusted diluted earnings (loss) per share | $ | (0.12) | (b) | $ | (0.02) | $ | (0.02) | $ | 0.08 |
HARSCO CORPORATION RECONCILIATION OF ADJUSTED EBITDA BY SEGMENT TO OPERATING INCOME (LOSS) AS REPORTED BY SEGMENT (Unaudited) | ||||||||||||||||||||||||||
(In thousands) | Harsco Environmental | Harsco Clean Earth | Corporate | Consolidated Totals | ||||||||||||||||||||||
Three Months Ended September 30, 2022: | ||||||||||||||||||||||||||
Operating income (loss) as reported | $ | 22,117 | $ | 17,315 | $ | (9,309) | $ | 30,123 | ||||||||||||||||||
Corporate strategic costs | — | — | 346 | 346 | ||||||||||||||||||||||
Harsco Clean Earth segment severance costs | — | 1,092 | — | 1,092 | ||||||||||||||||||||||
Harsco Clean Earth segment contingent consideration adjustments | — | (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 | % | ||||||||||||||||||||
Three Months Ended September 30, 2021: | ||||||||||||||||||||||||||
Operating income (loss) as reported | $ | 27,630 | $ | 9,893 | $ | (10,602) | $ | 26,921 | ||||||||||||||||||
Corporate strategic costs | — | — | 1,489 | 1,489 | ||||||||||||||||||||||
Harsco Environmental Segment severance costs | (900) | — | — | (900) | ||||||||||||||||||||||
Operating income (loss) excluding unusual items | 26,730 | 9,893 | (9,113) | 27,510 | ||||||||||||||||||||||
Depreciation | 27,179 | 4,576 | 491 | 32,246 | ||||||||||||||||||||||
Amortization | 1,997 | 6,033 | — | 8,030 | ||||||||||||||||||||||
Adjusted EBITDA | $ | 55,906 | $ | 20,502 | $ | (8,622) | $ | 67,786 | ||||||||||||||||||
Revenues as reported | $ | 269,901 | $ | 200,484 | $ | 470,385 | ||||||||||||||||||||
Adjusted EBITDA margin (%) | 20.7 | % | 10.2 | % | 14.4 | % |
HARSCO CORPORATION RECONCILIATION OF ADJUSTED EBITDA BY SEGMENT TO OPERATING INCOME (LOSS) AS REPORTED BY SEGMENT (Unaudited) | ||||||||||||||||||||||||||
(In thousands) | Harsco Environmental | Harsco Clean Earth | Corporate | Consolidated Totals | ||||||||||||||||||||||
Nine Months Ended September 30, 2022: | ||||||||||||||||||||||||||
Operating income (loss) as reported | $ | 63,931 | $ | (95,650) | $ | (27,413) | $ | (59,132) | ||||||||||||||||||
Corporate strategic costs | — | — | 128 | 128 | ||||||||||||||||||||||
Harsco Clean Earth segment goodwill impairment charge | — | 104,580 | — | 104,580 | ||||||||||||||||||||||
Harsco Clean Earth segment severance costs | — | 2,540 | — | 2,540 | ||||||||||||||||||||||
Harsco 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 | % | ||||||||||||||||||||
Nine Months Ended September 30, 2021: | ||||||||||||||||||||||||||
Operating income (loss) as reported | $ | 83,788 | $ | 20,457 | $ | (31,941) | $ | 72,304 | ||||||||||||||||||
Corporate strategic costs | — | — | 3,170 | 3,170 | ||||||||||||||||||||||
Harsco Environmental segment severance costs | (900) | — | — | (900) | ||||||||||||||||||||||
Operating income (loss) excluding unusual items | 82,888 | 20,457 | (28,771) | 74,574 | ||||||||||||||||||||||
Depreciation | 78,446 | 14,818 | 1,468 | 94,732 | ||||||||||||||||||||||
Amortization | 6,080 | 18,179 | — | 24,259 | ||||||||||||||||||||||
Adjusted EBITDA | 167,414 | 53,454 | (27,303) | 193,565 | ||||||||||||||||||||||
Revenues as reported | $ | 800,433 | $ | 585,891 | $ | 1,386,324 | ||||||||||||||||||||
Adjusted EBITDA margin (%) | 20.9 | % | 9.1 | % | 14.0 | % | ||||||||||||||||||||
HARSCO CORPORATION RECONCILIATION OF CONSOLIDATED ADJUSTED EBITDA TO CONSOLIDATED INCOME (LOSS) FROM CONTINUING OPERATIONS AS REPORTED (Unaudited) | ||||||||||||||
Three Months Ended September 30 | ||||||||||||||
(In thousands) | 2022 | 2021 | ||||||||||||
Consolidated income (loss) from continuing operations | $ | 1,427 | $ | 7,304 | ||||||||||
Add back (deduct): | ||||||||||||||
Equity in (income) loss of unconsolidated entities, net | 128 | 293 | ||||||||||||
Income tax (benefit) expense | 9,376 | 7,816 | ||||||||||||
Defined benefit pension income | (2,118) | (3,887) | ||||||||||||
Facility fees and debt-related expense (income) | 2,511 | 198 | ||||||||||||
Interest expense | 19,751 | 15,741 | ||||||||||||
Interest income | (952) | (544) | ||||||||||||
Depreciation | 31,892 | 32,246 | ||||||||||||
Amortization | 7,690 | 8,030 | ||||||||||||
Corporate strategic costs | 346 | 1,489 | ||||||||||||
Harsco Environmental segment severance costs | — | (900) | ||||||||||||
Harsco Clean Earth segment severance costs | 1,092 | — | ||||||||||||
Clean Earth segment contingent consideration adjustment | (827) | — | ||||||||||||
Consolidated Adjusted EBITDA | $ | 70,316 | $ | 67,786 |
HARSCO CORPORATION RECONCILIATION OF ADJUSTED EBITDA TO CONSOLIDATED INCOME (LOSS) FROM CONTINUING OPERATIONS AS REPORTED (Unaudited) | ||||||||||||||
Nine Months Ended September 30 | ||||||||||||||
(In thousands) | 2022 | 2021 | ||||||||||||
Consolidated income (loss) from continuing operations | $ | (110,352) | $ | 17,401 | ||||||||||
Add back (deduct): | ||||||||||||||
Equity in (income) loss of unconsolidated entities, net | 373 | 488 | ||||||||||||
Income tax (benefit) expense | 7,482 | 14,714 | ||||||||||||
Defined benefit pension income | (6,775) | (11,777) | ||||||||||||
Facility fees and debt-related expense (income) | 894 | 5,506 | ||||||||||||
Interest expense | 51,535 | 47,640 | ||||||||||||
Interest income | (2,289) | (1,668) | ||||||||||||
Depreciation | 97,959 | 94,732 | ||||||||||||
Amortization | 23,438 | 24,259 | ||||||||||||
Corporate strategic costs | 128 | 3,170 | ||||||||||||
Harsco Environmental segment severance costs | — | (900) | ||||||||||||
Harsco Clean Earth segment goodwill impairment charge | 104,580 | — | ||||||||||||
Harsco Clean Earth segment severance costs | 2,540 | — | ||||||||||||
Harsco Clean Earth segment contingent consideration adjustments | (827) | — | ||||||||||||
Adjusted EBITDA | $ | 168,686 | $ | 193,565 |
HARSCO CORPORATION RECONCILIATION OF PROJECTED CONSOLIDATED ADJUSTED EBITDA TO PROJECTED CONSOLIDATED INCOME FROM CONTINUING OPERATIONS (a) (Unaudited) | |||||||||||||||||||||||||||||
Projected Three Months Ending December 31 | Projected Twelve Months Ending December 31 | ||||||||||||||||||||||||||||
2022 | 2022 | ||||||||||||||||||||||||||||
(In millions) | Low | High | Low | High | |||||||||||||||||||||||||
Consolidated loss from continuing operations | (13) | (5) | (124) | (116) | |||||||||||||||||||||||||
Add back (deduct): | |||||||||||||||||||||||||||||
Income tax (income) expense | — | — | 8 | 7 | |||||||||||||||||||||||||
Facility fees and debt-related (income) expense | 1 | 1 | 2 | 2 | |||||||||||||||||||||||||
Net interest | 22 | 21 | 71 | 71 | |||||||||||||||||||||||||
Defined benefit pension income | (2) | (2) | (8) | (8) | |||||||||||||||||||||||||
Depreciation and amortization | 39 | 39 | 161 | 161 | |||||||||||||||||||||||||
Unusual items: | |||||||||||||||||||||||||||||
Harsco Clean Earth goodwill impairment | — | — | 105 | 105 | |||||||||||||||||||||||||
Harsco Clean Earth Segment severance costs | — | — | 3 | 3 | |||||||||||||||||||||||||
Harsco Clean Earth segment contingent consideration adjustment | — | — | (1) | (1) | |||||||||||||||||||||||||
Consolidated Adjusted EBITDA | $ | 47 | $ | 54 | $ | 216 | (b) | $ | 223 | (b) | |||||||||||||||||||
HARSCO 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) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Net cash provided by operating activities | $ | 13,422 | $ | 33,220 | 131,161 | $ | 46,750 | |||||||||||||||||||
Less capital expenditures | (39,854) | (40,861) | (101,645) | (109,507) | ||||||||||||||||||||||
Less expenditures for intangible assets | (47) | (155) | (147) | (287) | ||||||||||||||||||||||
Plus capital expenditures for strategic ventures (a) | 920 | 1,185 | 1,428 | 2,983 | ||||||||||||||||||||||
Plus total proceeds from sales of assets (b) | 1,698 | 5,470 | 8,289 | 15,512 | ||||||||||||||||||||||
Plus transaction-related expenditures (c) | 758 | 784 | 1,854 | 18,788 | ||||||||||||||||||||||
Harsco Rail free cash flow deficit/(benefit) | (8,161) | 2,089 | 30,827 | 31,837 | ||||||||||||||||||||||
Free cash flow | $ | (31,264) | $ | 1,732 | $ | 71,767 | $ | 6,076 | ||||||||||||||||||
HARSCO CORPORATION RECONCILIATION OF PROJECTED FREE CASH FLOW TO PROJECTED NET CASH PROVIDED BY OPERATING ACTIVITIES (Unaudited) (a) | ||||||||||||||
Projected Twelve Months Ending December 31 | ||||||||||||||
2022 | ||||||||||||||
(In millions) | Low | High | ||||||||||||
Net cash provided by operating activities | $ | 206 | $ | 221 | ||||||||||
Less net capital / intangible asset expenditures | (120) | (125) | ||||||||||||
Plus capital expenditures for strategic ventures | 2 | 2 | ||||||||||||
Plus transaction-related expenditures | 2 | 2 | ||||||||||||
Free cash flow | 90 | 100 | ||||||||||||