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By the numbers: Q2 2025
Revenue: $1.55B
Down 0.2% year over year
Net income: $126.9M
Down 4.8% year over year
Adjusted EBITDA: $336.2M
Up 2.6% year over year
- Financial picture: Clean Harbors announced Wednesday that its environmental services segment logged a 13th consecutive month of expansion in adjusted earnings before income, taxes, depreciation and amortization margin, even as some topline results declined year over year. Executives continued to tout the charge-for-oil strategy in the Safety-Kleen Sustainable Solutions business segment launched in November, saying results were ahead of expectations. “Our favorable outlook is underpinned by a powerful combination of macro and company specific catalysts,” co-CEO Mike Battles said on the company’s earnings call.
- Environmental services: The segment saw adjusted EBITDA increase by 4.5% year over year to $376 million. Pricing improved across the board, with Safety-Kleen Environmental Services growing revenue 9%. Incinerator utilization was 89% in Q2, excluding the Kimball, Nebraska, plant that is still ramping up. The company’s adjusted average incineration price rose 7% as well during the quarter.
- Safety-Kleen Sustainability Solutions: The segment saw adjusted EBITDA decrease 25.6% year over year to approximately $38 million. The segment is at slightly less than half its production target for the year, but CFO Eric Dugas said the SKSS has swiftly worked through a pricing backlog in its book of business, and expects sequential improvement in Q3. “That gives us comfort into Q3 and Q4 here that we're going to expand the profitability of the business,” Dugas said.
- Growth plans: The company’s Kimball incinerator continues to ramp up its pace, with Clean Harbors projecting the facility will process 28,000 tons of material and contribute $10 million in EBITDA in 2025. With the buildout of that project largely complete, Clean Harbors’ capital expenditures are down year over year, and it now anticipates spending $345 million to $375 million in 2025. That excludes roughly $15 million allocated for the company’s Phoenix hub project, which is under construction. Looking ahead, Clean Harbors plans to continue investing in the hub and spoke model, which provides cross-selling opportunities and other synergies, executives said.
- PFAS update: Clean Harbors is still waiting on the U.S. EPA to release its analysis of the PFAS destruction study the two entities conducted in Utah last year. But that hasn't hindered business, even as the federal agency hints at weakening regulations around per- and polyfluoroalkyl substances. “The market is acting as if regulations are in place, and that's evidenced in how our pipeline is growing and some of the projects that we're doing,” co-CEO Eric Gerstenberg said. The company did not share financial details of the business line, though executives said Clean Harbors is well positioned to take advantage of customer growth in the space.
- Policy impacts: “The demand environment has held up well for us, even in the face of tariff uncertainty that has impacted some of our customers,” Dugas said. Executives said volume from late Q1 carried into Q2. The company also expects an extra $10 million to $15 million of tax savings in 2025 from bonus depreciation, and likely more in 2026. While executives see the new tax policy as beneficial for customers and therefore a tailwind for Clean Harbors, it's unlikely to change the company's own capital deployment plans, Battles said.
- Field services: Margin improved in Clean Harbors' field services segment, in part thanks to a boost from the acquisition of Hepaco last year. Battles called returns from that deal “terrific.” Clean Harbors has opened 13 more field service branches this year as it continues to expand its emergency response business.
- Outlook: The company reaffirmed its guidance for both adjusted EBITDA and adjusted free cash flow for 2025. While Safety-Kleen has underperformed relative to 2024, executives expect less impact from seasonal fluctuations and a better cost structure to improve full-year results.
