Onterris, Inc. · NYSE:ONT
Onterris — Montrose Environmental Group — Q3 2020 Earnings Presentation
20 slides from Onterris's earnings presentation, Nov 12, 2020
Slide 1: Introduction to Montrose Environmental & Third Quarter 2020 Earnings Call
Introduction to Montrose Environmental & Third Quarter 2020 Earnings Call November 12, 2020
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: Business Overview
Business Overview
Slide 4: Montrose Environmental at a Glance
Montrose Environmental at a Glance • High growth environmental solutions company with a Treating water contaminated with unique focus on ESG Per- and polyfluoroalkyl excellence substances (PFAS) Managing air Removing quality through the contaminants • Completed IPO in July 2020 analysis of air and f
Slide 5: Highlights Q3 2020 and Q3 2020 YTD
Highlights Q3 2020 Q3 2020 YTD • Accelerating demand in Q3 drove Revenue Revenue strong results and business momentum +47% +32% to $84.7M to $219.5M • New business wins providing for solid performance across key services and geographies Adj. EBITDA(1) Adj. EBITDA(1) • Acquisitions and Organic growth
Slide 6: Strong Record of Profitable Growth Continues in 2020
Strong Record of Profitable Growth Continues in 2020 Multiple Levers to Drive Growth Continued market share Revenue Adjusted EBITDA(1) Organic gains through cross-selling ($ in millions, Dec FYE) $47 opportunities $287 Growth 16A – Q3 2020 16A – Q3 2020 High-single digit average LTM CAGR: $234 L
Slide 7: Resiliency of Our Business Model
Resiliency of Our Business Model Resiliency through Political Cycles and Resiliency through Economic Disruption Regulatory Frameworks • Not dependent on any singular political • Environmental services are approach or regulatory framework required and are often demanded by communities regardless of •
Slide 8: Key Drivers for Environmental Services Industry
Key Drivers for Environmental Services Industry Regulatory & Compliance Infrastructure Global Public Demands • For decades, federal and local • Increase in local industrial activity, • Heightened public awareness and regulators globally have complexity and impact increasing stakeholder demand for im
Slide 9: Consistent Creation of Economic Value
Consistent Creation of Economic Value Strategically Additive Organic Earnings Continued Investments (-) Acquisitions (+) Growth (+) • A core part of Montrose’s • Consistent growth since 2016: • Investments in corporate growth strategy is via infrastructure and in new acquisitions in a highly • Adjus
Slide 10: Key Organic Growth Initiatives
Key Organic Growth Initiatives 1 2 3 Deploy innovative Expand existing local Sell additional technologies, processes relationships into national environmental services to and applications to and international existing clients address unmet client relationships needs 4 5 6 Provide sales training and
Slide 11: Financial Overview
Financial Overview
Slide 12: Q3 and YTD Q3 2020 Revenue Performance
Q3 and YTD Q3 2020 Revenue Performance Q3 2020 Revenue • Solid revenue growth of 47% YoY ($ in mm) during Q3 and 32% in YTD Q3 2020 $85 • Growth in all segments $58 • Excluding discontinued service lines(1), revenue increased 60% YoY during Q3 Q3 2019 Q3 2020 2020 and 43% in YTD Q3 2020 YTD Q3 2020
Slide 13: Q3 and YTD Q3 2020 Adjusted EBITDA
Q3 and YTD Q3 2020 Adjusted EBITDA(1) Q3 2020 Adjusted EBITDA(1) ($ in mm) • Solid Q3 Adjusted EBITDA(1) growth $17 • Up 107% YoY to $16.7 million • Adjusted EBITDA Margin(1) $8 expanded 570 basis points YoY • Strong YTD Q3 Adjusted EBITDA(1) • Up 75% YoY to $36.2 million Q3 2019 Q3 2020 Margin(1) %
Slide 14: Q3 2020 Segment Highlights
Q3 2020 Segment Highlights • Assessment, Permitting and Response Assessment, Permitting and Response increase in Adjusted EBITDA and margin impact primarily reflects the CTEH ($ in mm) acquisition $26.6 $8.2 • Measurement and Analysis higher Adjusted EBITDA and margin driven by favorable business mi
Slide 15: Attractive Capital Structure
Attractive Capital Structure Commentary Flexible balance sheet to pursue investments in innovation and acquisitions in highly fragmented industry Montrose has $88.4 million of liquidity, including $38.4 million of cash and $50.0 million of availability under its revolving credit facility Net l
Slide 16: Improved 2020 Outlook
Improved 2020 Outlook Adjusted EBITDA(1) ($ in mm) Revenue expected to grow in excess $50 - $55 of 20% YoY Adjusted EBITDA margin(1) anticipated to be in range of 16.5% to 17.5%, delivering solid YoY improvement $31 Resilient financial performance through COVID-19 expected to continue, supporting im
Slide 17: Investment Highlights
Investment Highlights ESG Is Who We Are – The Environment is Our Business Strong Financial Performance with Consistent Track Record of Growth and Cash Flow Generation Resilient Across Political and Economic Cycles with Diverse Customers and End Markets Differentiated Technology, Processes an
Slide 18: Appendix
Appendix
Slide 19: Non-GAAP Financial Information
Non-GAAP Financial Information In addition to our results under GAAP, in this presentation we also present certain other supplemental financial measures that are not required by, or presented in accordance with, U.S. GAAP, including Adjusted EBITDA and Adjusted EBITDA margin. We calculate these meas
Slide 20: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ in mm) Note: Amounts may not total due to rounding (1) Represents non-cash stock-based compensation expenses related to option awards issued to employees and restricted stock grants issued to directors. (2) Represent start-up losses related to losses incurred on (i)
Montrose Environmental Group — Q3 2020 Earnings Presentation on 6ix