Clean Harbors, Inc. (NYSE:CLH) Q2 2019 Earnings Conference Call - Final Transcript
Jul 31, 2019 • 09:00 am ET
Michael L. Battles
will be driven by higher-value waste streams, overall performance in our facilities and some project work in the second half.
For Safety-Kleen, we continue to anticipate adjusted EBITDA growth in the low single-digit range due to growth in key lines of business in our branch network, including direct lube sales, effective spread management in Safety-Kleen Oil, and increased annual production in our re-refineries. In our corporate segment, we now expect negative adjusted EBITDA to grow by mid- to high single digits from 2018 due to increases in salaries and benefits as we continue to invest in our people.
Looking at our adjusted free cash flow guidance. Based on our current working capital assumptions and expectations for higher adjusted EBITDA, we have raised the low end of our range by $10 million to $200 million, which now gives us a midpoint of $210 million for 2019.
In summary, Q2 was another strong quarter for the company. Adjusted EBITDA in the Environmental Services and Safety-Kleen grew 8% to 9%, respectively, with 120 basis points margin improvement in both segments. Looking ahead, we remain enthusiastic about our prospects. While we recognize there are some macroeconomic uncertainties, we have not seen a meaningful slowdown in any of our core lines of business. For the most part, it has been just the opposite. We have a strong outlook for the back half of the year based on our backlog of waste in our facilities, new waste streams that continue to enter the commercial marketplace, the schedule of projects commencing and the stability of the Safety-Kleen branch business. Our goal remains to deliver on our promises and consistently report predictable results, which is our expectation for the back half of 2019.
And with that, Sherry, please open up the call for questions.