Quest Resource Holding Corporation · NASDAQ:QRHC
Quest Resource — Investor Presentation (March 2021)
29 slides from Quest Resource's investor presentation, Mar 12, 2021
Slide 1: National Provider of Waste & Recycling Solutions Investor Presentation
CLICK TO ADD MAIN TITLE HERE CLICK TO ADD SUBTITLE HERE NATIONAL PROVIDER OF WASTE & RECYCLING SOLUTIONS Quest Resource Holding Corporation (NASDAQ: QRHC) March 2021 INVESTOR PRESENTATION © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly p
Slide 2: Forward-looking statements
2 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
Slide 3: About Quest
ABOUT QUEST 3 Hazardous Waste All Combustible All Corrosive All Flammable Liquids & Solids All Toxic Compressed Gases Electronic Waste Light Bulbs Batteries Ballasts Automotive Waste Used Motor Oil Used Oily Water Used Antifreeze Oil Water Separators Used Oil Filters Used Air Filters Used Absorbents
Slide 4: What does Quest do?
RESOLUTION Recycling Landfill WHAT DOES QUEST DO? We focus on landfill diversion and managing regulatory compliance while ensuring complete alignment with the client’s business and sustainability goals DATA Provide uniform dataflow back to the client for business and sustainability planning TRANSFER
Slide 5: Investment highlights
Stable Client Relationships, Broad Service Offering and Recurring, Contractual Revenue Base Attractive Financial Profile Scalable Platform Poised for Growth Well-Positioned to Benefit from Structural, Long-Term Industry Tailwinds 2 Diverse client base in multiple industries including grocery, retail
Slide 6: Focus on large clients with complex waste streams
Clients span multiple industries including grocery, retail, automotive, restaurant, industrial, and construction Trusted by Fortune© 1000 Businesses with national footprints and complex waste streams 7-figure average deal size FOCUS ON LARGE CLIENTS WITH COMPLEX WASTE STREAMS 6 © 2021 Quest Resource
Slide 7: Quest's value proposition
7 UNIQUE ABILITY TO PROVIDE VALUE ADDED SERVICES, LOWER COSTS AND HIGHER LEVELS OF SERVICE QUEST’S VALUE PROPOSITION © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. Cost efficient procurement via network of 3,500 vendors Leve
Slide 8: National asset-light model and robust vendor network
National Coverage Every zip code in the U.S. Presence in Canada Network of 3,500 vendors Managed over 1.2 million services last year Significant volume through vendor assets Leverage vendor excess capacity – lower pricing for Quest and higher asset utilization for vendors 8 QUEST HAS INVESTED IN BUI
Slide 9: Scalable technology platform to support clients' CSR & operational performance
9 Comprehensive data reporting and process automation Transition to cloud completed in 2019 Central ERP system facilitates end-to-end information flow Client and vendor online portals SCALABLE TECHNOLOGY PLATFORM TO SUPPORT CLIENTS’ CSR & OPERATIONAL PERFORMANCE Meets U.S. EPA standards and the glob
Slide 10: Experienced management team
EXPERIENCED MANAGEMENT TEAM 10 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited.
Slide 11: Industry overview
INDUSTRY OVERVIEW
Slide 12: Waste generation continues to grow; landfill diversion pressures continue
Recycling and composting as means of waste disposal has grown from 15% to over 35% since 1990 WASTE GENERATION CONTINUES TO GROW; LANDFILL DIVERSION PRESSURES CONTINUE © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. 12 Waste
Slide 13: Landfill represents >50% of waste disposal
LANDFILL REPRESENTS >50% OF WASTE DISPOSAL; ~128M TONS OF NON-LANDFILL DISPOSAL METHODS 13 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. Landfill usage has declined from 70% in 1990 to just over 50% in 2017 Alternatives to
Slide 14: Recycling will continue to increase; plastics & food are major areas of focus
RECYCLING WILL CONTINUE TO INCREASE; PLASTICS & FOOD ARE MAJOR AREAS OF FOCUS & OPPORTUNITY 14 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. Plastics & Food remain two of the largest waste materials with >70% landfill dispo
Slide 15: Two major segments: asset intensive & highly fragmented
TWO MAJOR SEGMENTS: ASSET INTENSIVE & HIGHLY FRAGMENTED Large asset intensive, vertically integrated players with 56% market share Focused on both residential and commercial Generally specialize in one or two waste streams High percentage of profits derived from landfill ownership Operate ~700 landf
Slide 16: Differentiated from the two major competitive segments
DIFFERENTIATED FROM THE TWO MAJOR COMPETITIVE SEGMENTS 16 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited.
Slide 17: Quest business, performance & strategy
QUEST BUSINESS, PERFORMANCE & STRATEGY
Slide 18: Business transformation
18 2020 Initiated M&A growth strategy © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. BUSINESS TRANSFORMATION 2009 Founded 2009……………….…2015 2016 2017 2018 2019 2020 2021 2016 Business assessment led to focus on delivering com
Slide 19: Plan going forward
19 Business Foundation Strategy © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. PLAN GOING FORWARD Management team with > 50 years of total experience in value-added waste and related services Procurement strategy and robust
Slide 20: Focused M&A strategy: acquire companies with strong clients & focus on service
FOCUSED M&A STRATEGY: ACQUIRE COMPANIES WITH STRONG CLIENTS & FOCUS ON SERVICE 20 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. Acquisition Candidate Enables Growth at National Scale Reduces Capital Risk Adds Capabilities C
Slide 21: Shift to complex, differentiated services to select, high-value clients
21 Exit accounts with commodity services Focus on differentiated services Enter new end markets with greater barriers to entry Gross profit $s growth 9% annually through 2019 Consistent Gross Profit during COVID-19 Pandemic Gross margins have increased from 8% to 19% © 2021 Quest Resource Holding Co
Slide 22: Platform at scale to deliver operating leverage
22 Gross profit growth expected to flow through to EBITDA at ~50% Built client service, vendor management, financial control and technology functions Operating infrastructure in place to scale $5.9M improvement in Adjusted EBITDA since 2016 © 2021 Quest Resource Holding Corporation. Copying, publica
Slide 23: Recent financial results – 2020
RECENT FINANCIAL RESULTS – 2020 23 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. *A non-GAAP financial measure, "Adjusted EBITDA," is presented. From time-to-time, Quest considers and uses this supplemental measure of opera
Slide 24: Stable, scalable platform with attractive industry dynamics and financial characteristics
Stable Client Relationships, Broad Service Offering and Recurring, Contractual Revenue Base Attractive Financial Profile Scalable Platform Poised for Growth Well-Positioned to Benefit from Structural, Long-Term Industry Tailwinds 2 4 3 1 24 © 2021 Quest Resource Holding Corporation. Copying, publica
Slide 25: Appendix
Q |S APPENDIX
Slide 26: Reconciliation of U.S. GAAP to non-GAAP financial measures
RECONCILIATION OF U.S. GAAP TO NON-GAAP FINANCIAL MEASURES 26 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA (in thousands)
Slide 27: Reconciliation of U.S. GAAP to non-GAAP financial measures
RECONCILIATION OF U.S. GAAP TO NON-GAAP FINANCIAL MEASURES 27 © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited. RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA (in thousands)
Slide 28: Contact details
DAVE SWEITZER Chief Operations Officer 3481 Plano Pkwy. The Colony, TX 75056 877.321.1811 www.questrmg.com RAY HATCH Chief Executive Officer LAURIE LATHAM Chief Financial Officer © 2021 Quest Resource Holding Corporation. Copying, publication or redistribution outside of Quest is strictly prohibited
Slide 29: Client case studies
GROCERY STORE CHAIN NATIONAL FLEET OPERATOR MANUFACTURING Quest implemented a comprehensive landfill diversion program Created closed loop recycling solutions Created an online ordering system to streamline their process SOLUTION IMPACT Secured $2M+ in annual savings Recycled 885,000+ gallons of use
Quest Resource Holding — Investor Presentation (March 2021) on 6ix