US Ecology said an uptick in volume—notably from federal agencies including the US Army Corps of Engineers—and strong performance from its two recent acquisitions helped boost its second quarter earnings to $40 million, with net income of $6.4 million. Gross profit for the quarter was $17.3 million, up 32 percent from $13.1 million in the second quarter of 2011. Based on the strong performance, US Ecology raised expectations to between $48 and $52 million for the full year 2012, up from the $46 to $49 million expectation it announced at the end of the first quarter this year. "We posted very strong results across all sites and service sectors," Jim Baumgardner, president and CEO with US Ecology, said during a call with investors yesterday. "I continue to be pleased with the diversity and breadth of our business operations."
Treatment and disposal revenue for the company increased by 13 percent, despite a nearly 50 percent drop in transportation revenue. US Ecology disposed or processed of a total of 261,000 tons in the second quarter of 2012, up 21 percent from the 215,000 tons disposed or processed in the same quarter of 2011. Recurring base business, with higher pricing that US Ecology put in place late last year and early this year, increased during the quarter, though bidded event work remained flat. Reversing the recent trend in stagnant or shrinking government work, US Ecology reported yesterday that its government sector increased 22 percent, primarily with higher volumes from the U.S. Army Corps of Engineers. Treatment and disposal revenue from the Corps increased 13 percent in the second quarter of 2012 over the same period last year, with $3.6 million in revenue.
US Ecology announced that Dynecol, Inc., a permitted waste treatment, transportation and waste broker which was acquired in May and will be renamed US Ecology Michigan, already contributed $1 million in revenue for the quarter. Baumgardner said the Dynecol, Inc. acquisition in many ways parallels US Ecology’s ultimately unsuccessful bid for Siemens Water Technologies Corp. plant in Vernon, Calif., the bid for which expired last year. "In many ways this facility parallels the Siemens facility, however we believe it has more upside," he said. Baumgardner said US Ecology Michigan, on average, provides $3 million per quarter, and $12 million in annual revenue. The company’s Stablex operations, located in Quebec and acquired in 2010, also showed improvement, Baumgardner said. "I am very, very pleased with the Stablex performance. I think both quarters of this year, Stablex showed improvement."