Revenue and Profitability - Revenue for Q4 2024 was $70.0 million, a 0.9% increase compared to Q4 2023[5] - Gross profit for Q4 2024 was $10.7 million, a 6.7% decrease compared to Q4 2023, with a gross margin of 15.3%[5] - Total revenue for fiscal year 2024 was $288.5 million, a 0.1% increase compared to 2023[5] - Adjusted EBITDA for Q4 2024 was $1.7 million, down from $3.5 million in Q4 2023[5] Net Loss and Earnings - GAAP net loss per diluted share for Q4 2024 was $(0.46), compared to $(0.11) in Q4 2023[5] - Reported net loss for Q4 2024 was $9.508 million, compared to a loss of $2.330 million in Q4 2023[21] - Adjusted net loss per diluted share for fiscal year 2024 was $(0.03), compared to adjusted net income of $0.15 per diluted share in 2023[5] - Adjusted net income (loss) for Q4 2024 was $(1.839) million, a decrease from an adjusted income of $0.744 million in Q4 2023[21] - Diluted earnings per share for Q4 2024 was $(0.46), compared to $(0.11) in Q4 2023[21] Customer Acquisition and Business Strategy - The company added a record eight new customers in 2024, expected to generate at least seven figures of annual revenue each[5] - Successfully completed debt refinancing, reducing annual interest expense by approximately $1 million and improving credit terms[5] - The company plans to reduce headcount by 15%, which is expected to lower SG&A by approximately $3.0 million annually[5] - Recognized a non-cash impairment loss of $5.5 million related to the anticipated sale of a non-core business line[5] Assets and Liabilities - Total current assets increased to $75.139 million in 2024 from $60.613 million in 2023, representing a growth of approximately 24%[23] - Total liabilities rose to $121.489 million in 2024, up from $110.838 million in 2023, indicating an increase of about 10%[23] - Cash and cash equivalents increased to $396,000 in 2024 from $324,000 in 2023, reflecting a growth of approximately 22%[23] - Goodwill decreased to $81.065 million in 2024 from $85.828 million in 2023, a decline of about 5%[23] - The company reported an impairment loss of $5.511 million in 2024, with no such loss reported in 2023[21] - Total stockholders' equity decreased to $54.156 million in 2024 from $66.281 million in 2023, a decline of approximately 18%[23] Shareholder Information - The weighted average number of diluted shares outstanding decreased to 20,837 in Q4 2024 from 22,502 in Q4 2023[21]

Revenue and Customer Growth - Revenue for the year ended December 31, 2024, was $288.5 million, an increase of $0.1 million, or 0.1%, compared to $288.4 million in 2023[140] - Newly added customers contributed $18.6 million in additional revenue, with overall demand contributing an additional $25.6 million, an increase of almost 13% from 2023[141] Cost and Profitability - Cost of revenue increased to $238.5 million in 2024 from $238.3 million in 2023, with gross profit decreasing to $50.0 million from $50.1 million[142][143] - Gross profit margin was 17.3% for 2024, compared to 17.4% for 2023[143] - Operating expenses increased to $54.5 million in 2024 from $47.2 million in 2023, with selling, general, and administrative expenses rising to $39.5 million[145][146] - A $5.5 million impairment charge was recorded for the year ended December 31, 2024, associated with an asset group classified as held for sale[147] Financial Performance - Net loss for the year ended December 31, 2024, was $(15.1) million, compared to a net loss of $(7.3) million in 2023[152] - Adjusted EBITDA decreased by 10.7% to $14.5 million in 2024 from $16.2 million in 2023[155] - Adjusted net income (loss) for 2024 was $(0.7) million compared to $3.4 million in 2023[158] - Reported net loss for 2024 was $(15.1) million, compared to a net loss of $(7.3) million in 2023, reflecting a significant increase in losses[159] - Adjusted net income (loss) for 2024 was $(0.03) per diluted share, down from $0.15 per diluted share in 2023[159] Cash Flow and Working Capital - Working capital increased to $30.7 million in 2024 from $15.7 million in 2023, with cash and cash equivalents rising to $0.4 million from $0.3 million[160] - Net cash used in operating activities was $(6.1) million in 2024, compared to $(1.4) million in 2023, indicating increased cash outflow[168] - Cash used in investing activities rose to $(6.0) million in 2024 from $(1.9) million in 2023, primarily for the purchase of equipment[169] - Net cash provided by financing activities was $12.1 million in 2024, driven by $9.9 million in borrowings on the ABL Facility[170] Debt and Financing - The company has a senior secured term loan facility of $54.0 million, maturing on June 28, 2030, with a 1.00% annual amortization[163] - As of December 31, 2024, the company had a full valuation allowance for all deferred tax assets, indicating no anticipated recovery of these assets[182] - The company recorded a non-cash impairment loss of $5.5 million in 2024, contributing to the overall net loss[172] - The company expects existing cash and cash equivalents, along with borrowing availability, to be sufficient to fund operations for the next 12 months[162] Acquisitions and Financial Instruments - Acquisitions are accounted for under ASC Topic 805, with identifiable assets recognized at estimated fair values and any remaining purchase price recorded as goodwill[184] - All acquisition-related costs are expensed as incurred in selling, general and administrative expenses[185] - Financial instruments include cash and cash equivalents, accounts receivable, and accounts payable, with no significant currency or credit risks identified[186] - Variable rate indebtedness exposes the company to interest rate risk, as borrowings under senior secured credit facilities bear interest at variable rates[186] - The fair values of financial instruments approximate their carrying values, based on short maturities or current borrowing rates for similar loans[186] Risk and Obligations - The company has no off-balance sheet debt or obligations, nor any undisclosed transactions with related parties[188] - There are no guarantees of third-party debt by the company[188] - There are no applicable quantitative and qualitative disclosures about market risk[189]

Core Insights - Quest Resource Holding Corporation added a record eight new customers in 2024, indicating a strong value proposition and growth in customer activity [1][5] - The company successfully refinanced its long-term debt, reducing annual interest expenses by approximately $1 million and improving credit terms [1][6] - Quest is implementing a 15% reduction in headcount and expects to lower selling, general, and administrative expenses by $3 million annually due to operational efficiency gains [1][8] Fourth Quarter 2024 Financial Highlights - Revenue for Q4 2024 was $70 million, a 0.9% increase compared to Q4 2023 [6] - Gross profit decreased by 6.7% to $10.7 million, resulting in a gross margin of 15.3% [6] - GAAP net loss per diluted share was $(0.46), compared to $(0.11) in Q4 2023 [6] - Adjusted EBITDA was $1.7 million, down from $3.5 million in Q4 2023 [6] Fiscal Year 2024 Financial Highlights - Total revenue for FY 2024 was $288.5 million, a slight increase of 0.1% compared to 2023 [6] - Gross profit for the year was $50 million, also a 0.1% decrease from the previous year [6] - GAAP net loss per diluted share for the year was $(0.73), compared to $(0.36) in 2023 [6] - Adjusted EBITDA for FY 2024 was $14.5 million, down from $16.2 million in 2023 [6] Strategic Developments - The company secured eight new client wins, each expected to generate at least seven figures in annual revenue, marking the highest number of new client acquisitions in a single year [6][8] - Five expansion service agreements were secured with existing large clients, enhancing revenue potential [6] - The addition of over 1,200 vendors to the service platform is expected to broaden client service capabilities [6] Management Changes - Perry Moss has been appointed as CEO, and Nick Ober has joined as Senior Vice President of Operations, both expected to drive operational improvements [1][11]

Executive Changes - Perry W. Moss has been appointed as the new Chief Executive Officer, effective immediately, bringing over 30 years of experience in business development and operations [2][5] - S. Ray Hatch is retiring as CEO after nine years but will remain on the Board of Directors, during which time the company experienced significant growth and expanded its service lines [3][6] Operational Initiatives - The company has launched an Operational Excellence Initiative, with Nick Ober joining as Senior Vice President of Operations to enhance operational capabilities [1][8] - Moss has implemented a metric-driven sales management process that has led to a record number of new client wins and improved revenue generation capabilities [4][5] Financial Performance - Quest Resource Holding Corporation announced its fourth quarter and full year 2024 earnings, indicating a focus on increasing efficiency and profitability [1] Strategic Vision - The company aims to improve customer experience, drive technology-enabled efficiencies, and expand profit margins under Moss's leadership [5][7] - Quest positions itself as a partner of choice for large enterprises seeking efficient waste management solutions while enhancing sustainability [7][8]

Company Overview - Quest Resource Holding Corporation is a national leader in environmental waste and recycling services, helping larger businesses achieve their environmental and sustainability goals [4]. Upcoming Financial Results - Quest will release its fourth quarter and fiscal year results for the period ended December 31, 2024, on March 12, 2025, after market close [1]. - A conference call will be held on the same day at 5:00 PM ET to discuss the financial results and business outlook [2]. Access to Information - Investors can participate in the conference call by dialing specific numbers or accessing a listen-only webcast on Quest's investor relations website [2]. - The webcast will be archived for at least 90 days, and a telephonic playback will be available shortly after the conference call [3].

Core Viewpoint - Quest Resource Holding Corporation has successfully completed its refinancing process, amending its financing agreements with Monroe Capital Management Advisors and PNC Bank, which strengthens its balance sheet and supports long-term growth strategies [1][2][6]. Financing Agreements Summary - The amended credit agreement with Monroe Capital includes a $54 million aggregate principal amount of term loan, an extended maturity date to June 2030, and a reduced interest rate of SOFR plus 450 to 550 basis points, reflecting a margin reduction of 100 to 200 basis points from the previous agreement [8]. - The amended credit agreement with PNC Bank features an increased revolver commitment from $35 million to $45 million, an extended maturity date to December 2029, and a reduced interest rate of SOFR plus 200 basis points, reflecting a margin reduction of 25 basis points from the previous agreement [9]. Company Overview - Quest is a national provider of waste and recycling services, helping larger businesses achieve their environmental and sustainability goals through tailored solutions that generate measurable results [3]. - The company offers expertise across multiple industry sectors, providing data and information that track environmental results and improve business operations [3]. Leadership Insights - The President and CEO highlighted the benefits of the refinancing, including a substantial reduction in interest expenses and improved terms, which reflect the company's strong credit profile and business model [2]. - The Chairman of the Board noted that the new lending package will decrease the blended interest rate margin by about 150 basis points, resulting in an annual reduction of approximately $1 million in interest expenses [6]. - The CFO expressed appreciation for the support from PNC and Monroe, emphasizing their confidence in the company's future [7].

Core Insights - Quest Resource Holding Corporation has confirmed a partnership with Stonebriar Auto Services to enhance waste and recycling services across Stonebriar's service locations [1][5] - The collaboration aims to improve operational efficiency and sustainability goals for Stonebriar Auto Services while providing superior service experiences to clients [2][3] Company Overview - Quest Resource Holding Corporation is a national provider of waste and recycling services, focusing on helping larger businesses achieve their environmental and sustainability objectives [6] - Stonebriar Auto Services, founded in late 2019, operates Jiffy Lube locations nationwide and is committed to operational excellence and customer service [4][7] Partnership Details - Quest will deliver comprehensive waste and recycling solutions tailored to the needs of Stonebriar Auto Services, addressing various waste streams including oil, oil filters, tires, and antifreeze [3][5] - The partnership is expected to yield operational improvements, cost efficiencies, and enhanced sustainability outcomes for both organizations [5][6] Strategic Goals - The collaboration will leverage data-driven insights from Quest to continuously enhance waste and recycling programs, contributing to safer and healthier facilities for clients and communities [5] - Quest's solutions are designed to support businesses with complex waste streams, providing significant operational and sustainability benefits [5][6]

Core Insights - Quest Resource Holding Corporation has entered into a partnership with Stonebriar Auto Services to implement waste and recycling solutions across its facilities, enhancing operational efficiency and sustainability goals [2][4][6] Company Overview - Quest Resource Holding Corporation is a national provider of waste and recycling services, focusing on helping larger businesses achieve their environmental and sustainability objectives [7] - Stonebriar Auto Services, founded in late 2019, operates Jiffy Lube locations nationwide and is committed to operational excellence and customer service [5][8] Partnership Details - The collaboration aims to improve waste management operations at Stonebriar Auto Services, utilizing Quest's expertise in handling diverse waste streams, including oil, oil filters, tires, and antifreeze [6] - Quest's solutions are designed to provide operational improvements and cost efficiencies, aligning with Stonebriar's strategy to enhance service delivery [4][6] Strategic Goals - The partnership is expected to deliver substantial operational, cost, and sustainability benefits, particularly for businesses with complex waste streams [6] - Data-driven insights from Quest will enable Stonebriar to continuously enhance its waste and recycling programs, contributing to safer and cleaner facilities [6]

Financial Data and Key Metrics Changes - Revenue for Q3 2024 was $72.8 million, representing a 3.3% year-over-year increase and roughly flat sequentially from Q2 2024 [10] - Gross profit dollars decreased to $11.7 million, a 5.9% decrease year-over-year and a 13.5% decrease sequentially [14] - SG&A expenses were $10.3 million, an increase of $650,000 year-over-year and $890,000 sequentially [19] Business Line Data and Key Metrics Changes - Revenue from new and existing clients accounted for $16 million in Q3, primarily driven by onboarding 7 new clients and expansions with 3 existing clients [10] - New clients generated approximately 60% of their anticipated full-year revenue run rate during Q3 [11] - A decrease of approximately $13 million in revenue was attributed to softer-than-expected conditions in the industrial end market and client attrition [11] Market Data and Key Metrics Changes - The industrial end market experienced a significant sequential decrease in volumes from a large client, impacting overall revenue [11] - Lower-than-expected volumes were also noted from another large client, with growth offset by fluctuations in project work and seasonal production changes [12] Company Strategy and Development Direction - The company is focused on enhancing its technology platform to drive efficiencies and improve service delivery [25] - A new automated vendor management solution is expected to yield $2 million to $3 million in recurring cost savings [25] - The company aims to strengthen its balance sheet and refinance its debt by the end of the year, anticipating a significant reduction in interest rates [20][8] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment in the financial results but remains optimistic about the company's future, citing strong fundamentals and a growing pipeline [7] - The company expects to realize over $20 million in net incremental revenue from new client wins in 2025, excluding growth from existing clients [13] - Management believes that the challenges faced are temporary and that the company is well-positioned for future growth [33] Other Important Information - The company reported a record level of onboarding activity, with over 2,200 locations onboarded in Q3, a tenfold increase from the previous year [17] - The company is experiencing temporary increases in costs due to the transition to a new automated vendor management system [16] Q&A Session Summary Question: Can you quantify the impact of the vendor management system in the quarter? - The impact is difficult to quantify but is less than the $1 million in credits previously mentioned, with significant progress expected in Q4 [36] Question: How do you characterize the sales cycle and onboarding process? - The sales cycle has significantly sped up, evidenced by 9 new signings this year, and the onboarding process has improved in speed and accuracy [38][39] Question: How might the new administration impact the business? - The company does not anticipate significant changes at the federal level due to the election, as sustainability efforts are driven more by local regulations and market demand [41] Question: Can you elaborate on the land and expand strategy? - The strategy remains effective, with a focus on increasing capacity and efficiency rather than just headcount [44] Question: What is the current state of the new business pipeline? - The new business pipeline is stronger than expected, with several key targets moving toward closure [45] Question: Will the billing credits recur in the future? - The billing credits are not expected to recur, and the company has implemented measures to prevent similar issues [61] Question: What is the outlook for DSOs? - The company expects to return to targeted DSOs in the mid-60s, with improvements anticipated as new clients ramp up [66] Question: Why should investors consider owning the stock now? - The company has identified and is addressing controllable issues, and the addition of 9 new key customers this year positions it well for future growth [70][71]

Quest Resource (QRHC) came out with a quarterly loss of $0.16 per share versus the Zacks Consensus Estimate of a loss of $0.02. This compares to loss of $0.10 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -700%. A quarter ago, it was expected that this recycling company would post a loss of $0.01 per share when it actually produced a loss of $0.07, delivering a surprise of -600%.Over the last four quarters, the company has s ...