Financial Data and Key Metrics Changes - Montrose Environmental Group reported record revenue of $696.4 million for 2024, representing an 11.6% increase compared to 2023 [33] - Consolidated adjusted EBITDA for 2024 reached $95.8 million, up from $78.6 million in 2023, with an adjusted EBITDA margin of 13.8%, an increase of 120 basis points [10][34] - The company achieved a diluted adjusted net income per share of $1.08 for 2024, a slight increase from $1.07 in the previous year [35] Business Line Data and Key Metrics Changes - The Assessment, Permitting and Response segment reported fourth quarter revenue of $50.8 million, a slight increase from $50.1 million in the prior year [37] - The Measurements and Analysis segment saw a revenue increase of 21.3% to $65.5 million in the fourth quarter [38] - The Remediation and Reuse segment's fourth quarter revenue increased by 18.2% to $72.8 million, with adjusted EBITDA rising 53% to $12.7 million [39] Market Data and Key Metrics Changes - Approximately 20% of Montrose's revenue originated from international markets, including Canada, Australia, and Europe, a significant increase from 4% in 2021 [13] - The company noted strong performance in Canada and Australia, particularly in treatment technology services [14] Company Strategy and Development Direction - Montrose aims to simplify its balance sheet by redeeming $60 million of preferred stock in April 2025 and the remaining $62 million by the end of 2025 [22] - The company is temporarily deemphasizing M&A to focus on balance sheet optimization while maintaining a long-term strategy that includes acquisitions [23] - Montrose's integrated business model, supported by a portfolio of 24 patents, is expected to continue differentiating the company in the market [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to perform well under the new U.S. administration, citing historical growth during previous administrations [15] - The company anticipates 2025 revenue guidance of $735 million to $785 million and adjusted EBITDA of $101 million to $108 million, reflecting continued organic growth [28][47] - Management highlighted the importance of state-level regulations driving demand for treatment technologies, which provides stability for the business [17] Other Important Information - The company reported a leverage ratio of 2.1x and ample liquidity of approximately $300 million as of December 31, 2024 [46] - Montrose's cash flow from operating activities for the full year was $22.2 million, down from $56 million in the prior year, primarily due to increased working capital [41] Q&A Session Summary Question: Concerns about EBITDA margin guidance for 2025 - Management acknowledged the potential for continued margin expansion but indicated that the guidance reflects a steady outlook based on strong performance in 2024 [58][60] Question: Cash flow conversion expectations - Management explained that lower cash flow conversion in 2024 was due to timing issues related to receivables and expressed confidence in achieving the 50% target in 2025 [64][66] Question: Changes in project timelines post-election - Management reported no significant changes in project timelines and noted that client activity remains strong [76][80] Question: Cross-selling initiatives and organic growth - Management highlighted that over 50% of revenue is driven by cross-selling, with strong traction in clients purchasing multiple services [82][84] Question: International revenue growth potential - Management indicated that while international revenue is growing, the company will remain predominantly North America-based for the time being [96][97]

Fourth Quarter 2024 Earnings Call FEBRUARY 27, 2025 Disclosures 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 identified by the use of words such as "intend," "expect", and "may", and other similar expressions that predict or indicate future events or that are n ...

Core Insights - Montrose Environmental (MEG) reported revenue of $189.06 million for Q4 2024, a year-over-year increase of 14.1% and an EPS of $0.29, up from $0.27 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $187.81 million by 0.67%, while the EPS fell short of the consensus estimate of $0.31 by 6.45% [1] Revenue Breakdown - Revenues from Assessment, Permitting and Response were $50.81 million, below the average estimate of $56.30 million, reflecting a year-over-year increase of 1.4% [4] - Revenues from Remediation & Reuse reached $72.77 million, surpassing the estimated $65.90 million, marking an 18.1% increase year-over-year [4] - Revenues from Measurements & Analysis totaled $65.48 million, exceeding the average estimate of $59.42 million, with a year-over-year change of 21.2% [4] Adjusted EBITDA Performance - Adjusted EBITDA for Assessment, Permitting and Response was $7.93 million, significantly lower than the average estimate of $12.50 million [4] - Adjusted EBITDA for Remediation & Reuse was $12.75 million, slightly above the average estimate of $11.80 million [4] - Adjusted EBITDA for Measurements & Analysis reached $18.29 million, exceeding the average estimate of $13.15 million [4] Stock Performance - Montrose Environmental's shares have declined by 19.4% over the past month, compared to a 2.3% decline in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Revenue Performance - Record quarterly revenue of $189.1 million, an increase of $21.3 million, or 14.1% compared to Q4 2023[6] - Full year 2024 total revenue reached $696.4 million, an increase of $72.2 million, or 11.6% over the prior year[12] - Revenues for the year ended December 31, 2024, increased to $696,395 thousand, up 11.5% from $624,208 thousand in 2023[25] Net Loss and Income - Net loss for Q4 2024 was $28.2 million, or $0.90 loss per share, compared to a net loss of $1.4 million, or $0.18 loss per share in Q4 2023[9] - Net loss for the year ended December 31, 2024, was $62,314 thousand, compared to a net loss of $30,859 thousand in 2023, representing a 102.5% increase in losses[25] - Adjusted Net Income for Q4 2024 was $14.7 million, or $0.29 Adjusted EPS, equal to the prior year quarter[10] - Adjusted Net Income attributable to stockholders for the year ended December 31, 2024, was $44,768,000, compared to $39,713,000 in 2023, reflecting an increase of about 13%[40] - Basic Adjusted Net Income per share for the year ended December 31, 2024, was $1.35, compared to $1.32 for the previous year, indicating a slight increase of 2%[40] EBITDA and Financial Metrics - Consolidated Adjusted EBITDA for Q4 2024 was $27.2 million, an increase of $9.8 million, or 55.8%, representing 14.4% of revenue[11] - Full year 2024 Consolidated Adjusted EBITDA was $95.8 million, an increase of $17.2 million, or 21.9%, representing 13.8% of revenue[14] - The company reported an Adjusted EBITDA of $136,880 thousand for the year ended December 31, 2024, up from $116,452 thousand in 2023, indicating a 17.6% growth[31] - Consolidated Adjusted EBITDA for the year ended December 31, 2024, was $95,788,000, an increase from $78,576,000 in 2023, representing a growth of approximately 22%[47] Segment Performance - Organic revenue growth for the full year 2024 was 8.3%, driven by strong performance in Assessment, Permitting and Response, and Measurement and Analysis segments[12] - The Assessment, Permitting and Response segment generated revenues of $214,850 thousand in 2024, down from $220,727 thousand in 2023, a decrease of 2.0%[31] - The Remediation and Reuse segment saw revenues increase to $257,179 thousand in 2024, up from $206,386 thousand in 2023, representing a 24.6% increase[31] Financial Position and Liquidity - As of December 31, 2024, the leverage ratio was 2.1x, with $296.7 million of liquidity available[18] - The company entered into a new $500 million Senior Secured Credit Agreement to enhance financial flexibility[17] - Total current assets rose to $237,999 thousand as of December 31, 2024, from $200,924 thousand in 2023, reflecting an 18.4% increase[27] - Cash, cash equivalents, and restricted cash decreased to $12,935 thousand at the end of 2024, down from $23,240 thousand in 2023, a decline of 44.8%[27] - Total liabilities increased to $451,161 thousand as of December 31, 2024, compared to $342,606 thousand in 2023, marking a 31.7% rise[27] Shareholder Information - The weighted average common shares outstanding increased to 33,061 thousand in 2024 from 30,058 thousand in 2023, an increase of 10.0%[25] - The increase in fully diluted shares to 41,328,000 as of December 31, 2024, was primarily due to a public offering and changes in the conversion rate of Series A-2 Preferred Stock[45] Future Outlook - 2025 revenue guidance is projected to be in the range of $735.0 million to $785.0 million, with organic growth expectations of 7% to 9% per year[6] - The company expects variability in certain items, such as stock-based compensation and income tax expenses, to significantly impact future GAAP financial results[36] - Organic growth is defined as revenue changes excluding contributions from acquisitions and certain other factors, indicating a focus on sustainable growth strategies[37] - The company anticipates continued organic growth in the long term, leveraging its existing operations and market position[37] Expenses - The company incurred interest expense of $15,862 thousand for the year ended December 31, 2024, compared to $7,793 thousand in 2023, reflecting a 103.5% increase[25] - The company reported stock-based compensation expenses of $64,665,000 for the year ended December 31, 2024, up from $47,267,000 in 2023, marking a rise of approximately 37%[40]

Core Insights - Montrose Environmental Group reported record financial and operational performance for both the fourth quarter and full year of 2024, driven by strong demand for its integrated environmental services and technology [2][3] - The company experienced significant organic growth, improved margins, and successful integration of acquisitions, which validate its strategic business model [2][3] - The outlook for 2025 remains positive, with expectations of continued revenue growth and margin expansion [2][5] Fourth Quarter 2024 Highlights - Total revenue reached $189.1 million, a 14.1% increase from $165.7 million in the same quarter of 2023, with contributions from acquisitions and strong organic growth [3][5] - Net loss was $28.2 million, or $0.90 per share, compared to a net loss of $1.4 million, or $0.18 per share, in the prior year, primarily due to a one-time charge related to executive stock appreciation rights [4][5] - Consolidated Adjusted EBITDA was $27.2 million, representing 14.4% of revenue, an increase of 55.8% from the previous year [5][7] Full Year 2024 Highlights - Total revenue for the year was $696.4 million, an increase of 11.6% from $624.2 million in 2023, driven by acquisitions and organic growth [8][11] - The net loss for the year was $62.3 million, or $2.22 per share, compared to a net loss of $30.9 million, or $1.57 per share, in the prior year [9][10] - Consolidated Adjusted EBITDA for the year was $95.8 million, or 13.8% of revenues, up from $78.6 million, or 12.6% of revenues, in 2023 [11] Financial Position and Cash Flow - As of December 31, 2024, Montrose had a leverage ratio of 2.1x and $296.7 million in liquidity, including $12.9 million in cash [13][14] - Net cash provided by operating activities for the year was $22.2 million, a decrease from $56.0 million in the prior year, primarily due to increased accounts receivable [12] - The company entered into a new $500 million Senior Secured Credit Agreement to enhance its financial flexibility [13] 2025 Guidance - Revenue is expected to be in the range of $735.0 million to $785.0 million, with organic revenue growth anticipated at 7% to 9% per year [5][8] - Consolidated Adjusted EBITDA is projected to be between $101.0 million and $108.0 million, reflecting continued margin expansion and improved operating cash flow [5][8]

Core Insights - Montrose Environmental Group, Inc. appointed Mr. Vincent Colman to its Board of Directors and Audit Committee effective February 19, 2025, reflecting the company's commitment to enhancing leadership and driving long-term shareholder value [1][2] Group 1: Appointment and Expertise - Mr. Colman brings nearly 40 years of experience from PricewaterhouseCoopers (PwC), providing exceptional financial and accounting proficiency [1] - His expertise includes public company reporting, governance, and business strategy, which will be valuable for Montrose [1][2] - The Board confirmed Mr. Colman's independence and recognized him as an audit committee financial expert [1] Group 2: Mr. Colman's Vision - Mr. Colman expressed his honor in joining Montrose and emphasized the importance of strategic financial leadership in driving sustainable growth [2] - He aligns with Montrose's commitment to innovation and organic growth, aiming to build long-term value [2] Group 3: Company Overview - Montrose is a leading environmental solutions company with approximately 3,400 employees across over 100 locations globally [3] - The company offers a range of services including air measurement, regulatory compliance, emergency response, and remediation [3] - Montrose combines local knowledge with an integrated approach to effectively meet project requirements [3]

Core Points - Montrose Environmental Group, Inc. announced the planned dates for its fourth-quarter and full-year 2024 results and conference call [1] - The conference call is scheduled for February 27, 2025, at 8:30 a.m. Eastern Time [2] - A live webcast of the conference call will be available on the Montrose website [3] - An archived replay of the call will be accessible for 30 days following the live event [4] Company Overview - Montrose is a leading environmental solutions company with approximately 3,400 employees across over 100 locations worldwide [5] - The company focuses on supporting commercial and government organizations in addressing current challenges and preparing for future needs [5] - Montrose offers a range of services including air measurement, laboratory services, regulatory compliance, environmental emergency response, permitting, engineering, and remediation [5]

Core Viewpoint - Montrose Environmental Group, Inc. will participate virtually in the Needham 27th Annual Growth Conference due to wildfires in southern California, although its operations remain unaffected [1]. Company Overview - Montrose is a leading environmental solutions company with approximately 3,400 employees across over 100 locations globally [3]. - The company focuses on providing support to commercial and government organizations in addressing current challenges and preparing for future needs [3]. - Montrose offers a range of services including air measurement, laboratory services, regulatory compliance, environmental emergency response, permitting, engineering, and remediation [3]. - The company aims to deliver innovative and practical solutions to meet clients' immediate needs and strategic goals [3].

Core Viewpoint - Montrose Environmental Group, Inc. will present at the Needham 27th Annual Growth Conference on January 14, 2025, at 9:30 a.m. Eastern Time, with a presentation available on its website prior to the event [1]. Company Overview - Montrose is a leading environmental solutions company with approximately 3,400 employees across over 100 locations globally [3]. - The company focuses on supporting commercial and government organizations in addressing current challenges and preparing for future needs [3]. - Montrose offers a range of services including air measurement, laboratory services, regulatory compliance, environmental emergency response, permitting, engineering, and remediation [3]. - The company combines local knowledge with an integrated approach to effectively meet the unique requirements of each project [3].

Core Insights - Montrose Environmental Group, Inc. has been selected to install a mobile treatment system for PFAS at Sydney Water's Cascade Water Filtration Plant to address PFAS contamination in drinking water [1][3] Group 1: Company Actions - Montrose Environmental Group is recognized as a leading provider of water treatment solutions in Australia and has been engaged by Sydney Water to implement a mobile solution for immediate PFAS treatment [3] - The installation of Montrose's system aims to reduce PFAS levels below the limits proposed in the draft Australian Drinking Water Guidelines, which are expected to be finalized in April 2025 [3] Group 2: Industry Context - Sydney Water detected PFOS and PFHxS in the outlet of the Cascade WFP in June 2024 and took prompt action to address the PFAS issue [2] - The initiative reflects Sydney Water's commitment to delivering safe and reliable drinking water to its communities [4] - The collaboration with Montrose underscores the commitment to the Australian market and the potential for organic growth in the region [4]