enviri(US:NVRI)2021-08-02 16:00Financial Performance - Revenues for Q2 and six months ended June 30, 2021 increased approximately 27% and 30%, respectively, compared to the same periods in 2020, driven by the acquisition of ESOL and increased volumes in the Harsco Environmental and Clean Earth Segments [148]. - Operating income from continuing operations for Q2 and six months ended June 30, 2021 increased by $34.4 million and $56.3 million, respectively, due to increased volumes and the acquisition of ESOL [148]. - Diluted earnings per share from continuing operations for Q2 2021 were $0.18, up from a loss of $0.14 in Q2 2020, and for the six months ended June 30, 2021, earnings were $0.20 compared to a loss of $0.25 in the same period of 2020 [148]. - Total revenues for Q2 2021 increased by $122.5 million or 27.4% compared to Q2 2020, reaching $569.8 million [168]. - Total operating income for Q2 2021 was $36.2 million, significantly up from $1.9 million in Q2 2020 [167]. - Net income for Q2 2021 was $15.1 million, compared to a net loss of $9.5 million in Q2 2020 [167]. - Income from continuing operations was $16.2 million and $19.0 million for Q2 and the first six months of 2021, respectively, compared to losses of $9.6 million and $17.3 million in the same periods of 2020 [177]. Segment Performance - The Harsco Environmental Segment is expected to strengthen in 2021 due to improved demand for environmental services and increased commodity prices [150]. - The Harsco Clean Earth Segment anticipates financial improvement in 2021 driven by organic growth in hazardous waste processing and the integration of ESOL [150]. - The Harsco Rail Segment expects improved financial performance in 2021 supported by increased global demand for rail maintenance equipment and a record backlog [150]. - Harsco Environmental segment revenues for Q2 2021 were $272.5 million, up from $204.0 million in Q2 2020, reflecting a 33.6% increase [152]. - Harsco Clean Earth segment revenues for Q2 2021 were $196.1 million, an increase from $161.6 million in Q2 2020, representing a 21.3% growth [159]. - Harsco Rail segment revenues for Q2 2021 reached $101.1 million, up from $81.7 million in Q2 2020, marking a 23.9% increase [162]. - The ESOL acquisition contributed $134.2 million to Harsco Clean Earth segment revenues for the first six months of 2021 [159]. Expenses and Cash Flow - Cash flows from operating activities for the six months ended June 30, 2021 were $13.5 million, a decrease of $8.0 million compared to the same period in 2020, primarily due to unfavorable changes in working capital [149]. - Cost of services and products sold for Q2 2021 increased by $90.2 million or 24.8% compared to Q2 2020, totaling $454.4 million [170]. - Selling, general and administrative expenses for Q2 2021 rose by $1.9 million or 2.3% from Q2 2020, amounting to $82.7 million [171]. - Net cash provided by operating activities was $13.5 million in the first six months of 2021, a decrease of $8.0 million from the same period in 2020, attributed to unfavorable changes in working capital [182]. - Net cash used by investing activities decreased to $53.2 million in the first six months of 2021, down $398.7 million from the prior year, reflecting the purchase of the ESOL business in 2020 [183]. - Net cash provided by financing activities was $41.8 million in the first six months of 2021, a decrease of $419.7 million from the same period in 2020, primarily due to lower net cash borrowings [185]. Debt and Interest - Interest expense for 2021 is projected to increase due to higher average debt balances following the acquisition of ESOL [150]. - Interest expense increased by $1.0 million and $5.2 million for Q2 and the first six months of 2021, respectively, compared to the same periods in 2020, primarily due to higher borrowings and interest rates from the ESOL acquisition [173]. - The Company had a total outstanding debt of $1,333.0 million as of June 30, 2021, compared to $1,279.2 million at the end of 2020, with a net debt to adjusted EBITDA ratio of 4.6 [188]. - The Company expects to maintain compliance with debt covenants, with the ability to increase net debt by $321.6 million while remaining compliant [189]. Pension and Other Income - Net periodic pension income is expected to increase by approximately $8 million in 2021, primarily due to higher plan asset values [150]. - Defined benefit pension income rose to $4.0 million in Q2 2021 from $1.7 million in Q2 2020, and to $7.9 million for the first six months of 2021 from $3.3 million in the same period of 2020, driven by higher plan asset values [175]. - Total other comprehensive income increased to $17.9 million and $19.1 million in Q2 and the first six months of 2021, respectively, compared to $13.0 million and a loss of $17.0 million in the same periods of 2020, mainly due to currency translation effects [180].