Clean Harbors Drew $120 Million On Its Revolver, Then Sold $600 Million Of 6.250% Notes To Pay For Two Deals
The waste and oil re-refining company repaid the credit line on October 16, and now pegs its debt at a weighted average rate of about 5.4%.
Clean Harbors, which collects, treats and disposes of hazardous waste and re-refines used oil, borrowed $120.0 million on its revolving credit line on September 16, sold $600.0 million of 6.250% notes on October 1 and repaid the revolver on October 16, its quarterly report shows. The financing paid for two acquisitions, ES&H and EnviroServe.
Three moves in a month
The September 16 draw partly funded the ES&H purchase, which closed on September 18 for an all-cash $300.7 million, net of cash acquired. The rest came from cash on hand.
The notes mature on September 30, 2034, with the first interest payment due March 31, 2027. About $470 million of the proceeds financed the EnviroServe purchase on October 2, and the remainder repaid the $120.0 million revolver borrowing.
At September 30, with the draw still outstanding, the company had $335.5 million available on its $600.0 million facility, plus $144.5 million of letters of credit outstanding.
A higher debt rate, not a lower one
In its prior quarterly report, the company said it expected interest expense for the rest of 2026 to run lower than the prior year. Now it puts the debt's weighted average rate at about 5.4% once the October notes and the revolver payoff are counted, assuming current rates. The earlier filing put the effective rate at 5.2% as of June 30.
The earliest maturity in the debt portfolio is now 2029. The company kept buying back stock throughout: $25.0 million in the quarter and $75.0 million over nine months.
A quarter flattered by one job
Third-quarter adjusted EBITDA rose to $456.1 million from $320.2 million a year earlier. The earnings release says one emergency response event produced about $120 million of revenue at emergency response rates, so part of the strength came from a single job.
Cash was tighter. Receivables and unbilled receivables absorbed $276.9 million in the nine months, against $113.1 million a year earlier, and cash from operations of $664.7 million includes that drag.
The company has bought five businesses this year, and it describes the allocations for ES&H and EnviroServe as provisional. Terra Nova's goodwill moved from $110.8 million to $122.9 million after a $16.2 million deferred tax liability was booked. Shares traded at $317.10 in Wednesday trading.
Final purchase price allocations for ES&H and EnviroServe are still to come, and the first coupon on the 2034 notes falls due March 31, 2027.
Sources
- 10-Q Filing — Clean Harbors (CLH) — SEC EDGAR
- 10-Q Filing — Clean Harbors (CLH), Q2 FY2026 filed 2026-07-29 (comparison basis) — SEC EDGAR
- Earnings release (8-K Item 2.02, clh-q32026pressrelease.htm) — Clean Harbors, filed 2026-10-28 — SEC EDGAR
- Compared to Estimates, Clean Harbors (CLH) Q3 Earnings: A Look at Key Metrics — Yahoo Finance
- Clean Harbors (CLH) Q3 Earnings and Revenues Surpass Estimates — Yahoo Finance
- Clean Harbors Announces Third-Quarter 2026 Financial Results – Company Announcement - FT.com — Financial Times
- Clean Harbors (CLH) Broker Upgrades Raise The Question Of Whether Shares Are Fully Valued — Yahoo Finance
- Clean Harbors GAAP EPS of $3.93 beats by $0.68, revenue of $1.87B beats by $140M (CLH:NYSE) — seekingalpha.com
