Onterris, Inc. · NYSE:ONT
Onterris — Montrose Environmental Group — Q1 2024 Earnings Presentation
26 slides from Onterris's earnings presentation, May 8, 2024
Slide 1: First Quarter 2024 Earnings Call
First Quarter 2024 Earnings Call May 8, 2024
Slide 2: Safe Harbor
Safe Harbor Statements contained herein and in the accompanying oral presentation contain 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. Forward-looking statements may be iden
Slide 3: Operating Overview
Operating Overview 4 < BH Zz a = Zz ° ee & z aa fe) 4 = Z O = & < }
Slide 4: Highlights Q1 2024
Highlights Q1 2024 • Record first quarter revenue and Consolidated Adjusted Total Operating EBITDA(1) primarily due to strong organic revenue Revenue Segments Adj. EBITDA growth from: $155.3M $27.8M - Continued cross-selling success; Up 18.2% YoY to a 17.9% of Revenue First Quarter Record - Contribu
Slide 5: Capabilities Aligned With Sustainable and Secular Industry Tailwinds
Capabilities Aligned With Sustainable and Secular Industry Tailwinds ASSESSMENT, PERMITTING MEASUREMENT AND RESPONSE AND ANALYSIS REMEDIATION & REUSE Advisory Response Testing Water Treatment Remediation Renewable Climate Change & Event Driven Response ü ü ü ü ü ü Emerging Contaminant Regulation (e.
Slide 6: Recent M&A Overview
Recent M&A Overview • Successfully completed three value- 2014 enhancing acquisitions 2014in 2024 which provide: 1. Additive services and client opportunities 2. Geographic expansion • Demonstrated ability to effectively integrate, cross-sell and create synergies • Acquisition pipeline remains robus
Slide 7: PFAS Total Addressable Market
PFAS Total Addressable Market We Provide Integrated Solutions for PFAS Management Testing & Analysis (Enthalpy) Water Treatment Technology (ECT2) Ultra-trace laboratory tests for 70+ PFAS 2014 Full range of PFAS treatment products 2014 and services including design & compounds, both legacy compounds
Slide 8: Financial Overview
Financial Overview
Slide 9: Q1 2024 Revenue Performance
Q1 2024 Revenue Performance • Record Q1 revenue • Revenue increased 18.2% to $155.3M, Q1 2024 Revenue ($ in Millions) as reported • Q1 revenue growth driven by: $155.3 - Strong organic growth in AP&R and M&A segments, and; $131.4 - Contributions of completed acquisitions Q1 2023 Q1 2024 © 2024 Montr
Slide 10: Q1 2024 Consolidated Adjusted EBITDA Performance
Q1 2024 Consolidated Adjusted EBITDA(1) Performance Consolidated Adj. EBITDA(1) Growth • Record Q1 Consolidated Adjusted EBITDA(1) Q1 2024 Consolidated Adjusted EBITDA(1) ($ in Millions) up 1.9% on higher revenues • Lower Q1 Consolidated Adjusted EBITDA(1) as a percentage of revenues due to business
Slide 11: Q1 2024 Diluted Adjusted Net Income per Share
Q1 2024 Diluted Adjusted Net Income per Share(1) • Q1 Diluted Adj. EPS(1) of $0.16 compared to $0.17 in prior year quarter Q1 2024 Diluted Adj. Net Income per Share(1) • Q1 Diluted Adj. EPS(1) change driven by higher interest and depreciation $0.17 $0.16 • Diluted Adj. EPS(1) calculated using Adjust
Slide 12: Assessment, Permitting and Response Segment Performance
Assessment, Permitting and Response Segment Performance • Revenue growth primarily due to Q1 2024 Revenue strong organic growth in advisory ($ in Millions) services $52.2 $58.6 • Margin growth driven by strong revenue growth and a favorable mix of revenues • Q1 Revenue includes environmental Q1 23 Q
Slide 13: Measurement & Analysis Segment Performance
Measurement & Analysis Segment Performance • Revenue growth primarily driven by Q1 2024 Revenue strong organic growth across lab services ($ in Millions) - Software coupled with sensor networks $42.5 $45.5 continue to create new and differentiated opportunities • Lower margins during the quarter dri
Slide 14: Remediation & Reuse Segment Performance
Remediation & Reuse Segment Performance • Revenue growth primarily driven by acquisition of Matrix, partially offset by lower Q1 2024 Revenue ($ in Millions) revenue in ECT2 (given delays in PFAS $51.3 regulations that were recently promulgated $36.7 and the pivot towards higher margin biogas servic
Slide 15: Attractive Capital Structure
Attractive Capital Structure Commentary • Flexible balance sheet to further invest in Equity Market Capitalization innovation and acquisitions in highly fragmented industry • In January 2024 voluntarily redeemed $60 million of Convertible and Redeemable Series A-2 Preferred Stock(1) in cash Preferre
Slide 16: Outlook
Outlook
Slide 17: Updated 2024E Outlook Reiterated
Updated 2024E Outlook Reiterated Outlook Driven by Market Tailwinds, Growth Initiatives and Margin Optimization Q1 2024 Revenue ($ in Millions) $690 - $740 • Revenue is expected to be in the range of $690 - $624(2) $740 million and Consolidated Adjusted EBITDA(1) is expected to be in the range of $9
Slide 18: Disciplined Capital Allocation Approach to Drive Strong Returns
Disciplined Capital Allocation Approach to Drive Strong Returns © 2024 Montrose Environmental Group, Inc. Proprietary and Confidential. 18
Slide 19: Investment Highlights
Investment Highlights Unique, vertically integrated Significant scale with global reach environmental company serving repeat client base Large TAM and secular tailwinds Consistent record of strategically and backed by regulatory and corporate financially accretive acquisitions initiatives coupled wi
Slide 20: Appendix
Appendix 6” MONTROS ENVIRONMENTAL
Slide 21: Summary of Oaktree A-2 Preferred Investment
Summary of Oaktree A-2 Preferred Investment Post-IPO Terms Governance Summary • In April 2020, Oaktree Capital • No fixed maturity date • Oaktree has the right to purchased $175mm of Series appoint one representative on A-2 Preferred Equity to fund - Repayable in cash at the Montrose board of the ca
Slide 22: Non-GAAP Financial Information
Non-GAAP Financial Information In addition to our results under GAAP, in this presentation we also present certain other supplemental financial measures of financial performance that are not required by, or presented in accordance with, GAAP, including, Consolidated Adjusted EBITDA, Consolidated Adj
Slide 23: Reconciliation of Net Loss to Adj. Net Income and Diluted Adj. Net Income per Share
Montrose Environmental Group, Inc. Reconciliation of Net Loss to Adj. Net Income and Diluted Adj. Net Income per Share (In thousands except per share amounts) For the Three Months Ended March 31, 2024 2023 Net loss $ (13,357) $ (14,719) Amortization of intangible assets (1) 7,429 7,240 Stock-based c
Slide 24: Reconciliation of Net Loss to Adj. Net Income and Diluted Adj. Net Income per Share
Montrose Environmental Group, Inc. Reconciliation of Net Loss to Adj. Net Income and Diluted Adj. Net Income per Share (In thousands except per share amounts) Quarter Ended Year Ended December September December September March 31, 31, 30, June 30, March 31, 31, 30, June 30, December 31, 2024 2023 2
Slide 25: Reconciliation of Net Loss to Consolidated Adjusted EBITDA
Montrose Environmental Group, Inc. Reconciliation of Net Loss to Consolidated Adjusted EBITDA (In thousands) For the Three Months Ended March 31, 2024 2023 Net loss $ (13,357) $ (14,719) Interest expense 3,306 1,541 Income tax expense (benefit) 493 1,367 Depreciation and amortization 11,653 10,555 E
Slide 26: Reconciliation of Net Loss to Consolidated Adjusted EBITDA
Montrose Environmental Group, Inc. Reconciliation of Net Loss to Consolidated Adjusted EBITDA (In thousands) Quarter Ended Year Ended December September December September December March 31, 31, 30, June 30, March 31, 31, 30, June 30, 31, 2024 2023 2023 2023 2023 2022 2022 2022 2023 Net loss $ (13,3
Montrose Environmental Group — Q1 2024 Earnings Presentation on 6ix