Quest Resource Holding Corporation · NASDAQ:QRHC
Quest Resource — Investor Presentation (August 2017)
28 slides from Quest Resource's investor presentation, Aug 23, 2017
Slide 1: National Service Integrator of Waste & Recycling Solutions Investor Presentation
Exhibit 99.1 NATIONAL SERVICE INTEGRATOR OF WASTE & RECYCLING SOLUTIONS INVESTOR PRESENTATION TMAUGUST 2017 NASDAQ: QRHC TM NASDAQ: QRHC AUGUST 2017 NATIONAL SERVICE INTEGRATOR OF WASTE & RECYCLING SOLUTIONS INVESTOR PRESENTATION ©2017 Quest Resource Holding Corporation.
Slide 2: Forward-Looking Statements
The statements contained in this Investor Presentation that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements o
Slide 3: Who We Are
Who We Are… “Nationwide single source provider of reuse, recycling and disposal services for a wide variety of waste streams and recyclable materials generated by businesses” Our Value Proposition… “We leverage our scale and technology to enable businesses to improve their operations and environment
Slide 4: Sustainability and food waste spending trends
Today, the United States spends over $218 billion – 1.3% of GDP – growing, processing, transporting, and disposing of food that is never eaten* Sustainability is one of the most significant trends in financial markets as it creates competitive advantage, improves operating performance, and positivel
Slide 5: Investment Highlights
Investment Highlights Positive Market Conditions • Mega trend - global recognition that resources are finite • $3.3 billion addressable market • Efficiencies of scale and scope with a national footprint, broad service offerings, and access to large quantities of recyclable materials • Direct alignme
Slide 6: A Vast Market
A VAST MARKET • Total market opportunity is $60B • Quest’s primary target, which consists of the top 50-100 companies in each vertical, is $3.3B • Quest captured a 5.6% market share in 2016 TARGET MARKET SIZE 2016 REVENUE Market Size at (in millions) Primary Target OPPORTUNITY SIZE (in millions) $ 6
Slide 7: Key Value Proposition
KEY VALUE PROPOSITION ©2017 Quest Resource Holding Corporation. National service integrator providing a broad scope of waste, recycling, and support services to business DESIGN SOURCE IMPLEMENT TRACK Tailored Solution- Service and recycling technology agnostic to select best services to meet each cl
Slide 8: Quest Vs. Competition
Quest Vs. Competition Major Competitive Differentiators • Direct alignment with clients’goals • National scale • Broad scope of services NATIONAL MORELESS LOCAL FOOTPRINT CUSTOMER ALIGNMENT Vertically Integrated Waste Management Companies Highly Fragmented Regional and Local Providers Quest Resource
Slide 9: Direct Alignment with Clients' Sustainability and Financial Goals
DIRECT ALIGNMENT WITH CLIENTS’ SUSTAINABILITY AND FINANCIAL GOALS VERTICALLY INTEGRATED MODEL • Tied to limited disposal methods • Slow to innovate • Burdened by large fixed cost assets • Investing in trucks, facilities or rolling stock • Requires large capital investment to scale • Lack scale and s
Slide 10: Providing Consistent Service on a National Scale
PROVIDING CONSISTENT SERVICE ON A NATIONAL SCALE National coverage• Every zip code in the U.S. presence in Canada and Puerto Rico • Leverages over 3,500 subcontractors • 30, 000 trained professional• 24,000 trucks • 600 recycling facilities Solid execution TM • managed over 2.5 million services per
Slide 11: Broad Scope of Services
BROAD SCOPE OF SERVICES ©2017 Quest Resource Holding Corporation. TOTAL MANAGED 1.4 MILLION TONS Used Motor Oil 40M gallons • Re-refined • Source of energy Used Oil Filters 12,000 tons • Metal and plastic recovery • Source of energy Used Tires 17M tires • Source of energy • Crumb rubber • Rubber mul
Slide 12: Superior Service Delivery Enabled by Technology
Superior service delivery enabled by technology • Flexible information technology infrastructure allows Quest to provide innovative and efficient recycling solutions • Scalable IT platform as companies continue to outsource their waste, recycling, and support requirements • Client & service provider
Slide 13: Strategic Repositioning
Strategic Repositioning New Management Team With a New Approach DISCIPLINED APPROACH TO CLIENT ACQUISITION EXPAND SERVICE with large base of existing cLIENTS Targeting new vertical markets Driving profitability by improving SOURCING ©2017 Quest Resource Holding Corporation.
Slide 14: Disciplined Approach to Client Acquisition
DISCIPLINED APPROACH TO CLIENT ACQUISITION DISCIPLINED APPROACH TO CLIENT ACQUISITION Providing the RIGHT Services.. to the RIGHT Clients… in the RIGHT Markets • Greater focus on services that highlight our value add less focus on commoditized services • Continue to target large clients with nationa
Slide 15: Expand Services with Large Base of Existing Clients
EXPAND SERVICES with large base of existing CLIENTS AUTOMOTIVE INDUSTRIAL GROCERY/RESTAURANT PROPERTY MANAGEMENT CONSTRUCTION • Trusted by Fortune© 1000 clients with national footprint and complex waste streams • Proven ability to surround clients with valuable services • Focusing on existing client
Slide 16: Expand into Client Verticals with Complex Needs
©2017 Quest Resource Holding Corporation. 16 EXPAND INTO CLIENT VERTICALS WITH COMPLEX NEEDS 2 Subcontractors 1 Material Managed 24 Hours Service Response Time Minimal Environmental Reporting Requirement 3,500 Subcontractors 100 Materials Managed 2 Hours Service Response Time Extensive Environmental
Slide 17: Driving Profitability by Improving Our Sourcing
Driving profitability by improving our sourcing Treat subcontractors as essential partners • Help subcontractors maximize efficiencies • Right sizing- changing the size of the containers and the service frequency to be the most efficient • Load optimization- ensure the optimum volume per service to
Slide 18: Repositioned to Resume Revenue Growth
Repositioned to Resume Revenue Growth ORGANIC REVENUE GROWTH PHASES 2010-2015 CAGR 14% 2016-2017 Repositioning Phase 2018-2023 Target Annual Growth 12%-14% Growth Drivers: • Penetrate Existing Clients • Enter New Vertical Markets ©2017 Quest Resource Holding Corporation.1 2 3
Slide 19: Initial Results of Strategic Plan Execution
INITIAL RESULTS OF STRATEGIC PLAN EXECUTION • Repositioning strategies delivered six quarters of Y-O-Y bottom line improvement • Focus on increasing gross profit $ • Expect adjusted EBITDA breakeven during 2017 • 3-5 year adjusted EBITDA margin target of 4%-6% of sales Adjusted EBITDA $ Gross Profit
Slide 20: Key Facts
key facts Trading Symbol NASDAQ:QRHC Recent Price ( June 30, 2017) $2.42 52-Week Trading Range $1.36 to $2.99 Fiscal Year End 31-December Shares outstanding* 15.3 million Fully Diluted Shares* 18.5 million Market Capitalization $37 million Cash* $1.4 million $20 Million Line of Credit* $6.2 million,
Slide 21: New Management Team with a New Approach
NEW MANAGEMENT TEAM WITH A NEW APPROACH S. Ray Hatch, Chief Executive Officer, President and Director Has served as Chief Executive Officer of Quest Since February 2016. A senior executive with in-depth experience building profitable business and orchestrating transformational growth, Mr. Hatch brin
Slide 22: Investment Highlights
Investment Highlights Positive Market Conditions • Mega trend - global recognition that resources are finite • $3.3 billion addressable market • Efficiencies of scale and scope with a national footprint, broad service offerings, and access to large quantities of recyclable materials • Direct alignme
Slide 23: Appendix
APPENDIX ©2017 Quest Resource Holding Corporation.
Slide 24: Business Case - Large Fleet
BUSINESS CASE- LARGE FLEET One of the largest commercial fleets in the United States needed to improve the overall sustainability of their service vehicles and turned to Quest to find closed loop solutions within their fleet of 71,000 service vehicles. • Quest completed a series of assessments and m
Slide 25: Business Case - Large Retailer
BUSINESS CASE- LARGE RETAILER • A large grocery store chain with thousands of stores and distribution centers spread across the U.S. needed to dramatically reduce its ecological footprint to achieve its aggressive sustainability goal. • The retailer did not have the staff nor the experience to expan
Slide 26: Business Case - Manufacturer
BUSINESS CASE- MANUFACTURER • A large manufacturer came to Quest looking to reduce their environmental footprint in a cost-effective manner. • Quest completed a series of plant assessments, measuring the waste baselines and calculating the company’s current waste management expenditures. • Quest ide
Slide 27: Reconciliation to US GAAP and Non-GAAP Financial Measures
reconciliation to US GAAP and non GAAP Financial Measures Q4 Q3 Q2 2016 2016 2016 Revenue 41,370$ 42,540$ 45,039$ 46,157$ 46,844$ Cost of revenue 36,922 38,354 41,366 42,562 43,189 Gross profit 4,448 4,186 3,673 3,595 3,655 Selling, general, and administrative 4,582 4,980 3,954 4,923 4,638 Depreciat
Slide 28: Quest Resource Holding Corporation contact details
Quest Resource Holding Corporation 3481 Plano Parkway The Colony, Texas 75056 972.464.0004 www.qrhc.com www.questrmg.com www.earth911.com Ray Hatch Chief Executive Officer Laurie Latham Chief Financial Officer Dave Sweitzer Chief Operating Officer
Quest Resource Holding — Investor Presentation (August 2017) on 6ix