Quest Resource Holding Corporation · NASDAQ:QRHC
Quest Resource — Investor Presentation (August 2020)
23 slides from Quest Resource's investor presentation, Aug 19, 2020
Slide 1: Investor Presentation August 2020
CLICK TO ADD MAIN TITLE HERE CLICK TO ADD SUBTITLE HERE Investor Presentation August 2020 National Service Integrator of Waste & Recycling Solutions Quest Resource Holding Corporation NASDAQ: QRHC Exhibit 99.1
Slide 2: SEC Safe Harbor
SEC Safe Harbor 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 t
Slide 3: About Quest
ABOUT QUEST © 2020 Quest Resource Holding Corporation. Copying, publications or redistribution outside of Quest is strictly prohibited. Hazardous Waste All Combustible All Corrosive All Flammable Liquids & Solids All Toxic Compressed Gases Electronic Waste Light Bulbs Batteries Ballasts Automotive W
Slide 4: What We Do: Quest Manages the Waste Streams of Large Businesses
WHAT WE DO QUEST MANAGES THE WASTE STREAMS OF LARGE BUSINESSES © 2020 Quest Resource Holding Corporation. Copying, publications or redistribution outside of Quest is strictly prohibited. DESIGN A CUSTOMIZED PROGRAM Design solutions and services that are best suited to meet a customer’s sustainabilit
Slide 5: What We Do – Some Examples
WHAT WE DO – SOME EXAMPLES 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 Recyc
Slide 6: Focus on Large Customers with Complex Waste Streams
FOCUS ON LARGE CUSTOMERS WITH COMPLEX WASTE STREAMS © 2020 Quest Resource Holding Corporation. Copying, publications or redistribution outside of Quest is strictly prohibited. Customers span multiple industries including grocery, retail, automotive, restaurant, industrial, and construction Trusted b
Slide 7: Stable Customer Relationships, Differentiated Service and Recurring Revenue Base
2 Stable Customer Relationships, Differentiated Service and Recurring, Contractual Revenue Base Diverse customer base in multiple industries including grocery, retail, automotive, restaurant, industrial, and constructions Differentiated and targeted by diverse 5+ waste streams, regulated and non-com
Slide 8: Recent Financial Results – 2Q 2020
Recent Financial Results – 2Q 2020 © 2020 Quest Resource Holding Corporation. Copying, publications 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 9: Industry Overview
— Guest — sustanasiury. Ss DELIVERED: Industry Overview
Slide 10: Waste Generation Continues to Grow; Landfill Diversion Pressures Continue
Waste generation continues to grow in the U.S. while per capita generation has largely remained flat since 1990 Recycling and composting as means of waste disposal has grown from 15% to over 35% since 1990 Source: EPA Advancing Sustainable Materials Management 2017 Fact Sheet; analysis uses Municipa
Slide 11: Landfill Still Represents >50% of Waste Disposal
Landfill usage has declined from 70% in 1990 to just over 50% in 2017 Alternatives to landfill are increasingly able to process a range of waste streams Source: EPA Advancing Sustainable Materials Management 2017 Fact Sheet; analysis uses Municipal Solid Waste (“MSW”) generation as proxy for overall
Slide 12: Recycling Will Continue to Increase; Plastics & Food Major Areas of Focus
Plastics & Food remain two of the largest waste materials with >70% landfill disposal Recycling Will Continue to Increase; Plastics & Food a Major Areas of Focus & Opportunity Source: EPA Advancing Sustainable Materials Management 2017 Fact Sheet; analysis uses Municipal Solid Waste (“MSW”) generati
Slide 13: Industry Landscape: Large Integrated Players and Small Players
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 landfills in the U.S. and own ~$35B in PP&E (1) Includes Wast
Slide 14: Quest Asset Light Model vs. Asset-Based Integrated Majors
Quest Asset Light Model Service not tied to company-owned assets Alignment with sustainability Agnostic to disposal method Flexible resources and nimble operations Service Commercial Accounts National accounts Waste stream complexity Across all zip codes National Scale and Scope Ability to scale on
Slide 15: Quest Business, Performance & Strategy
Quest Business, Performance & Strategy
Slide 16: Business Transformation & Plan Going Forward
Founded in 2009 Focused on commoditized services for single waste stream customers Competed on price Intense customer concentration Undifferentiated and low value proposition <8% gross margins and unprofitable at EBITDA level No structure or strategy to vendor management and client solutions Lack of
Slide 17: Quest Has Invested in Building a National Asset Light Platform
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 customers and higher asset utilization for vendors 1,000 recycling facilit
Slide 18: Unique Ability to Provide Lower Costs and Higher Levels of Service
Unique ability to provide lower costs and higher levels of service 75% of gross profit: regulated waste streams 70% gross profit: customers with 5+ waste streams 80% of gross profit: does not compete with large, national vertically integrated majors Breadth of capabilities reduces competitive risks
Slide 19: Financial Performance; Gross Margins, Adjusted EBITDA Margins & Cash Conversion
Exit of accounts where undifferentiated Retained accounts with potential for profitable growth and improved margins Established new end markets with waste stream complexity and attractive margins Built customer service, vendor management, financial control and technology functions Operating infrastr
Slide 20: Acquisition Strategy: Ideal Acquisition Candidate
Goal is to acquire new customers that will be well-served on Quest’s platform Customers are sticky and tend to stay with the acquiror as long as service levels are maintained Many regional / local players have longstanding customer relationships but are reluctant or unable to grow due to lack of inf
Slide 21: Appendix
— Guest — sustanasiury. Ss DELIVERED: Appendix
Slide 22: Experienced Management Team
EXPERIENCED MANAGEMENT TEAM Has served as Chief Operating Officer of Quest since October 2016. More than 20 years of experience in the waste, recycling, property management, and business services industries. Prior to Quest, he served as Chief Sales Officer, Executive Vice President, and Senior Vice
Slide 23: Reconciliation of U.S. GAAP to Non-GAAP Financial Measures
RECONCILIATION OF U.S. GAAP TO NON-GAAP FINANCIAL MEASURES © 2020 Quest Resource Holding Corporation. Copying, publications or redistribution outside of Quest is strictly prohibited. RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA (in thousands) 2016 2017 2018 2019 Revenue $183,811 $138,346 $103,806 $
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