Revenues Drop for HCC

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Revenues Drop for HCC

Heritage-Crystal Clean’s oil business segment – which includes oil collection activities, rerefining activities and sales of recycled fuel oil – posted revenues of $19.7 million in the second quarter ending June 13, dropping 43% from $34.8 million in 2019’s second quarter.

The COVID-19 pandemic and related shelter-in-place orders led to a significant decrease in the demand for finished lubricants, which directly impacted demand for the company’s base oil products, the Elgin, Illinois-based company said in its earnings news release. The company further noted that the pandemic impacts also led to a significant decline in the generation of used oil, which negatively impacted used oil collection and the feedstock volumes used in its rerefinery in Indianapolis, Indiana.

“While the COVID-19 pandemic created significant challenges in our oil business segment

during the second quarter, we were able to take advantage of the market conditions and move up a planned extended shutdown of our rerefinery from the fourth quarter of 2020 into the second quarter,” Heritage Crystal-Clean President and CEO Brian Recatto said in the earnings release. “This move should allow us to reduce the amount of planned rerefinery downtime during the second half of 2020.”

Recatto noted that later in the quarter, the company began to see increases in sales activity in both its oil business and environmental services segments, compared to the middle of the second quarter. “We believe our second quarter results will represent the bottom of this economic cycle for our business, barring the wide-spread return of shelter-in-place orders,” he said.

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