Quest Resource Holding (QRHC) 23 Mar 232022 Q4 Earnings call transcript

Thank you for standing by. This is the conference operator. Welcome to the Quest Resource Holding Corporation Fourth Quarter 2022 Earnings Conference Call. [Operator Instructions].

I would now like to turn the conference over to Dave Mossberg, Investor Relations representative. ahead. go Please

and the Brenda, everyone, joining for Thank thank on call. us you, you,

begin, and remind estimates, differ factors, intend, identify expectations, as risks forward-looking Such projections, Before conference and discussed current involve like Quest's anticipate, detail intended Commission. of assumptions or I'd we to could to words of significant of which other contain uncertainties. events and future statements results like estimates in forward-looking on greater similar Quest. future Securities in materially Exchange are in events Actual Use various call estimate, everyone based discussed a statements. predictions, and and result regarding those other statements expect, forward-looking and statements filings project, or beliefs Quest's are the those performance are believe may the Quest's forward-looking from this that with expressions

not consult we are unless cautioned of do are duty forward-looking to to statements date such presented reliance filings on such update to law. and any Quest's so required risks and made, SEC You additional the our by and uncertainties. undue to disclaim as place statements statements for

reports industry this on Quest's and well estimates, independent and in may market and government information based firms are by conditions and data research sources. information about data call, addition, and statistical we industry as and other In views and market observations include as Quest's developments. other publications The publications,

the the or are the that has other are of caution information believes of information. Quest these and sources sources verified independently accurate, Although and reliable accuracy data the Quest the not we reliability

performance. by otherwise a useful basis. is the forecast financial this discussed will measures included the prospects these be that is are for non-GAAP be stated, assessment non-GAAP company's this on Management GAAP and operations of any in evaluate assumed strategic future it reconciliation to the decisions, in of financials future. believes Certain earnings the current non-GAAP Unless investors of ongoing and make Full core are measures today's non-GAAP measures to be discussed presentation release. it non-GAAP the during measures financial call. management These results company's to should financial also used will understanding call

that now all over I'll to Hatch, call Executive With and Ray Officer. said, Chief the turn President

customers Thank ramp Quest. Overall, had expanding a you, growth your year, came with from in year significant We growth tremendous existing X the through Dave, strong customers. dollars. in during and a everyone, thanks, Growth integrating new gross in during interest and for XX% profit also XXXX. XXXX managed with relationships we acquisitions from

process news these performance. but according is but fully addressed XXXX. that of The acquisitions in RWS substantial that hampered have base, far to caused during see with the through good issues, the challenges past expect a we've the year. improvements business from the fourth, strong for plan, acquisition quarter and customer and we've first contribution to already planned realize begun thus It to is Three us good a gone RWS, the this issues

of business our RWS, well. Outside performed

We all through move we our executing pipeline. are our to strategies, well of continue on new opportunities

continually We enable will operating more which drive investing efficiencies, continue operating to service. to and quickly integrate in our build us platform, to acquisitions our capabilities, enhance customer

remains for XXXX unchanged. outlook beyond and growth in our Importantly, profitable

the an fourth there of RWS you and what's an and to quarter to I large year, over I'm going has Brett on to a Because the update call going corrective actions overview review taken. turn the the such before we've give on financials, impact on

to implement longer the that to time the was opportunities of we over end was made background, business and the decided pursue the RWS Quest To integrate same have would made at us give The you acquisition avoid then the disrupting This largest acquisition plan the time was to to fully and the to a contribution business. to cross-selling while, wait the little have a business. of allow that to we at time, thinking at we processes we date, until period. XXXX. The acquisition business more operate this achieve RWS, integrate the highest

quickly waiting mistake retrospect, fully was In to which X integrate major RWS caused a issues.

route vendor the there, processes vendors such volume it in to in rightsizing areas optimization. with First, RWS, of challenging because gaps entails pricing, optimization working information was which implement and as our

reduce through by being to Second, with fuel contracted our and million these was surcharges profit factors We passing a estimate done cost increases $X.X of dollars approximately RWS customers. normal process not XXXX. gross subset combined of the for

practice best each realigned RWS and department. Quest reporting implemented business for management have We've across structure

groups now are of systems accounting, the the marketing year, expect and integrated be sales completed and to the as end during quarter. integrations of fully Our operation, third we

fuel process part the RWS. corrected pass contractual We've of at are that surcharges to costs through and agreements the

and we costs to started RWS surcharges While implementing starting benefits we January. and periods, catch pass-through past customers of see up can't fuel in to bill for

We've gaps vendor and improvements. management addressed information implemented

improvements We to throughout are and in quarter in see first seeing the year. profit the gross the expect benefits

Along business, continued the the begun quarter. improvement taken with already incremental the result to strength we first have have during corrective of actions in core our

profits is million gross we averaging February month per and release, for approximately Preliminary further As showed across $XX remainder year. improvement million the results with positive. in trajectory month, said averaging of press the expected revenue $X.XX the per and the January

relationships remain we've want the our in RWS successfully reiterate and our improved or to While Quest existing potential expected And was cross-sell remain Equally the of to able fact, we've RWS view also strong. relationships maintained to with delayed, intact. business services It's clients. note vendors. that to been important important, financial I expectations customer of original contribution from RWS that

and tranches. Brett for now be to the I'll back to overview, over call discuss I'll turn our CFO, our Brett? financial Johnston,

challenges everyone. at solid integration good by RWS. the during performance results Ray, in quarter, being mixed We and business core Thanks, had offset fourth our afternoon, with

price quarter seasonality. to fourth normal fluctuations the it in A quick decrease revenue, note about primarily and sequential was related commodity

discussed price commodity previous have had profit material fluctuations effects calls, gross not historically on As dollars. on

not Our The of dollars to gross through we passes clients to customer that price P&L. consistent value our simply behalf volumes tied commodities commodity are of on on recycle our the agreements fluctuations. produce profit based

During And quarter, XXXX, $XX.X for the profit year-over-year dollars increased the fourth increased profit million. to year XX% million. to dollars gross gross XX% $XX.X

the organic came the X/X estimate growth gross the the dollars of For we that Of organic quarter, the profit was remaining growth. acquisitions approximately driven new the X/X growth. increase by for and bulk in customer quarter, from from

dollars in organic and was year, year, we growth. the the approximately growth profit For came gross the for Of new the bulk acquisitions X/X driven of by organic the X/X increase from also the from estimate growth. that customer remaining

it to have stated, was we and As due in from difficult previously ongoing to comparison profit resulting sequential make quarter-to-quarter during dollars accounting integration adjustments, gross work XXXX. the

made of However, has during RWS, adjustments accounting and the as Ray XXXX. acquisition significant mentioned these were earlier, been with progress we feel finalized

earlier, said during Ray we dollars $X.X the XXXX gross approximately As issues that estimate million. with by reduced RWS profit

was our this slower-than-expected with certain and to optimization related of reminder, normally implementation that as agreements. processes contract of RWS part missing take we contracted a As customers price adjustments

with pricing We note were not were that of I pressure comparisons flexible cost sequential pressures. by and inflationary fees. dollar profit cost affected recovery cost inflationary able Outside want to offset gross RWS, to

full We the and second the have RWS in at implemented quarter. effect will by of expect end changes these changes be

continued is and to momentum from for gross remain dollars our our in improvement outlook the deliver our forward, gross XXXX. profit and dollars double-digit for robust, we profit confident organic benefit year growth during profit dollars in continued growth efforts. Looking should ability in integration Gross from

to compared The Moving acquired related were fourth on same million increase $X.X last the comparison to expenses, SG&A during quarter period $X.X the was which mostly businesses. the during in overhead from million to year.

was integration expectations million of than which million, mostly reserves our For higher and the debt a $X.X to to costs. related increased quarter, little $X.X additional bad was SG&A

$X.X of we expect million, the first continuously to costs, investment and people increased of costs $XX During ongoing SG&A platform. the the improve in million and with about our systems, scalability the integration along XXXX, and acquisition to quarter our and our rate efficiency will reflects run business, processes which ongoing be of

fourth acquisition amortization amortization quarter, versus to year $X.X increase ago. million The increased the intangibles. During of million was a to related depreciation of and $X.X primarily

amortization and XXXX. million for approximately depreciation be expect We $XX to

to and sheet. balance of review a flow on the cash Moving

good in liquidity-wise. are We shape

cash which balance flow $X.X by million we our enhanced $XX the was fourth the million We December, the during million In increased operating year. million, from cash of $X.X in liquidity the Our the to million. quarter. at generated size line beginning $X.X increasing from of approximately $XX borrowing operating

For the year, investment nearly our used company cash of support in was working The to primarily flow. use operating capital of doubling year-over-year. $X.X size to million related the in cash we

during acquisition million we and million, $X.X cash was a CapEx utilized first XXXX, to in purchase smaller $X.X approximately quarter. During the

increased to made At during expect we includes in increase notes the $XX.X million XXXX, operating in million investment had payable $X That quarter, of in the platform. the year. our growth beginning the slight million during we increase We investments versus a approximately end XXXX. $XX.X the CapEx at in of reflects which

Ray. time, At call back this I'll the turn to

you, Thank Brett.

happy overall the and tremendous our for of RWS, the the last the this double-digit opportunity with years want not that during outlook I has X growth. we're While integration for the affect to several process growth it not on not company reflect our does does made quarter company reiterate that progress and continued

addressed I the the past size of the with specific double-digit realize this proud in been the in our they've team issues the beginning track to that and marking doubling reiterate of benefit nature. very of very growth were that And are company in consecutive produced, this year we but EBITDA. acquisition. RWS to nearly want has X strategic I'm have years of we XXXX, record

we time acquisition in EBITDA million of of to the RWS and a December XX, we approximately adjusted InStream $X.X annually. of combined announced add At the expected

our performing line behind and it EBITDA 'XX, expectations. year, expectations InStream the delivered incremental is our was RWS with during While positive still in in

inflationary our positioned is strong, and values well. and challenging business that and continue significant of business fall conditions well we're execute held commodity up certain and economic weather growth see continues to to recycled model In strategies. to a our market pressure materials, Our

gross we those significantly commodity and agreements the swings scrap earlier, But prices so that prices. significant the mentioned in gross not decrease for affected second by generated during commodities of dollars metal affected profit are dollars other Brett despite swings. 'XX, in by half profit structured As not were our the

In us surcharges. we're cost able an allow offset as cost to to pressures flexible contracts increasing for pass inflationary through environment, fuel that

passed we through this not inflationary Again, forward, business, While these going on costs contracts our issue RWS, we've corrected during the RWS. in at pass at offset being XXXX continue and pressures. successfully for to core were costs

see we and Regarding levels stable proposition and our markets, end in our is with activity economic of both general, the new continue customers. all environment existing value with to across resonating

feel very growth growth. we our about years. us. I installed growth. last to to Within the use has about on good the organic for of base Moving front consistently of to strategy a customers, discussion base land-and-expand have X deliver of delivered in a organic continue we the This growth strategy

We quarter incentive recently client to it's in the from chance with We team. made level excitement way to and slight go a a investment them structure offering customers. 'XX, small the of on the of the rewarding a been incentive growth. based This compensation all increase first compensation entire change existing growing service will contribution to in our to long see made our tweak managers, this earn pay

more our In clients' the best and to help attract and from growth to addition, changes these diverting with align us further expect talent the goals, landfill. retain us waste we

services to feel new actively clients. organic contribution customers services to our existing service to to we Another growth come. the recent existing years We customers By capabilities provide geographies, acquisitions, new major key a will several these confident to services. added and growth we're with adding for introducing that existing new the new is and adding organic from continue

last for we've growth of of client the closing years, targets. top during new are improved On targeting couple right existing and new on the customers,

automotive in course wins, we one continued and through them we customers end are market. months. X onboarding the of Last our service of the several and in one these about way markets early stages market add We're quarter, industrial new the across ramp opportunities over the During pipeline. in new fourth to to to their XX next expect the large spoke multiple working quarter, X-figure prospects, and XX

our uniform to service ability and of customer key the XX all Our existing continues across streams, customer supported new data data of within across their platform, industrial X,XXX now The delivering to our the good Fortune provide proposition we're fourth this provide value the onboarded its of multiple role to base. with securing customer locations customer end for by 'XX. value A waste play revenue illustration a in during large wins ramp a lines sets a is X-figure was quickly quarter 'XX. and how customer fully to U.S. growing became new able We're during and and in

from We to cost landfill, have with tons and we've and provide able with our only that have strong the the also such not had of was their them savings. more of brought divert platform portal so we than sustainability so data reports. team to a helped direct systems and but providing dedication XXX,XXX data a customer this them I'm ramp and value proud quickly ESG for our capabilities appreciative impressed of our feed them the proposition. from date, important are and portion To operation their of

to a on M&A. discussion Moving about

M&A our continue and be forward. that We've reiterate will all want that in fit on 'XX. we discipline RWS going maintain to than track will reiterate to plans since only have that acquisitions our I expect XXXX. X opportunities, criteria. execute Other We'll at those made evaluate during part to be continue growth And expectations. important continue back I making acquisitions. we'll of an above RWS, to our to or We performed

do We've gross our the organic base efficiencies. improving operating grown cash Growth into build flow growth to years, We've throughout our of efficiencies growth streams customer efficiencies, the markets, since business we've continue in last and driven rapidly converting not and earnings. X ability improve diversifying linear, but acquisitions. to completing has financial organization our end tripling new over drive and more acquisitions Moving with to achieved scale and to to size in grown been and and We've XXXX. into the rapidly profit and customers, strength. been invest operating continually We'll nearly capabilities new integrate existing through scale waste the to by this X drive so. the organization,

to XXXX. Regarding for our plan We've outlook RWS for from to expect has expect issues growth the continued contribution our in positive improvement and RWS see to not and with changed. outlook, profitable overall, our during achieve months quarters we addressed the come original and

contribution the from expect efficiencies We and integration acquisition from incremental increased to both provide cross-selling. and

We business core positive momentum expect XXXX. in continued our of during the

to growth of gross we wins client are services. Pressure lowering investing to The the in onboard these improve sustainability, And from provide of cost gross capabilities bar continue incremental increasing cash profit, profit as we for programs. adaptation contribution regulation, flow landfills increasing new and recycling and to dollars will in efficiencies, driving continue will drive operating earnings.

We we'll several progress. the to look next and forward updated our with optimistic on positive for you keeping I continue 'XX momentum are years.

provide We how for on now like queue instructions the listeners Operator? questions. to can up operator

Instructions]. [Operator

from comes question Spychalla from first Craig-Hallum. The Aaron

then market? given how of you in kind cycle. proposition the drivers trending what that's of process? cycle sales with just how And are sales talk the you a shorten focused some on to macro maybe that And resonating just can has little the been value your there onboarding, First, the on funnel, about gone the the Can and of recent that some talk key wins? on about you're sales bit

Shorten key phrase, thank process for the Yes. the you the is Aaron, question.

pipeline of Our to a bit represents dichotomy me. a

hand, the one quality very the and the along pipeline. of the prospects On moving with I'm impressed

but don't I prospects know type if don't across. for. tell have get is On reiterate, prospects not, And good out. that there, we're the been the to pushed and in you looking to I falling I hand, them got customers it's will the want we've macro cause or other Aaron, slow the we

moving they longer we little we just know it's the But a it. as good do not it's would taking is like. that quickly will, news is frustration to as Our

far something digest, onboarding as process ramp year on. in. think driven might to locations goes, And we in as It's I prepared large months. really new have is accelerate. I always by it last say, think mentioned will usually the past, taken that to the we XX and in push took customer a ability to had putting we that remarks, And the I industrial customers'

and our getting is The forward ability digest move new think on, to date how the customers to transition. accelerated. can question So locations is move the up fast on I

maybe All initiatives regulating waste, food just look and on give what time? kind waste then you Can an around seen of states just right. And update kind might of we've there numerous food you opportunity that. corporate like for and that over

and waste getting I of, Yes. guess, so. is Thanks attention, rightfully that's for Food observation. a lot that, good and a

the of of largest, going is landfills are not organic of the One materials largest, if into the group waste. that type

those up. major So filling it's things a in culprit

lot it. a the to that's about luckily, things point. area feeding one is got your has So of growth. excited of that We're Regulation it,

so before And somebody guess I maybe have answer group. may that it it's -- taken making sometimes not our then sales from they helps our call

So what we've have that active of honest a with really are I'll leads that brand But is going with I exciting the really educating possibilities forward. big think to as part nice some is helping that there press them And us. gotten lot some diverting. for a conversations you, move us. the be helping and the of and names regulation it's in

prospects. added We're year. we've really of lot And this the excited so moving for path. I'm down And a new

going food think growth an we're program waste accelerated in to I see our adaptation.

that. for good. Good, I'll it it turn We'll over. for That's tuned stay me.

Sweeney The next ROTH question from comes Capital. from Gerard

Would described by and much chance? pricing, commodity some able how was On guess, the also seasonality be commodity line. pricing out you impacting, break you I fourth seasonality, quarter, was revenue to the much how

take that This I'll Brett. is question.

customers there. like was think related just I revenues, talk the there thing lost first the to to about So no we'd QX

you it the if will the that's half, fine. most get way and core commodity decreases base you'd if in of most that customers, to So seasonality, get you split But you Again, very mostly take that there value there. the want related, of was solid.

if And seasonality. said that, you. Got meant apologize lost mean I didn't I I I customers,

was think reaffirming, it's I No, I just important. no,

there Sorry, Perfect. But it. was got noise my in background.

fair to seasonality? XX-XX commodity, So say part part

Yes.

Got it. it. Got

we even then became million course or gross that maybe or impacted pressures, more side, sort maybe it margin. that And look we did out RWS half second $X.X later that out the on the Because at of do some become sort year. Or that fourth that? you quarter? Okay. the the of inflation loaded pricing of loaded year? lack pass-through, How of broke in cumulative saw more in the spread Was across

you're I of No, more the about it year right. thinking half of as think definitely that related. back

Got it.

So I don't want at, gave but gross profit. guidance, $XX.XX I I profit. mean gross you say sort running of million February think, to this $X.XX to year, That equates January, million you're

So things metric? on January? front, they even February But were sort of on that is are also Or back. bouncing that better than

mostly February say days. I'd certainly has even. business fewer

average. an So there's those. it But yes, take different factors go as that I'd into

some this at around numbers Gerard, in to and Ray. not I we And We I it's thing. started to there, January, but this think right January, there's but word, yes, -- want with agree fixing implementing fixed is we clarify. just And a February out reiterate started cycle did I least key through. sadly in We put that. January the Brett. got just but it

go So by, in there. more what the from more our expectation benefit to and is were kind we months verbally trying put that of That's we'll that. as get

looked it, of looking in increases, then I quarter mean the bit seasonality I some say when a price and January get system. there's takes you. through, through of good. little got there's was to exiting I at it fourth imagine And time February, you kind cycle Okay. I probably that,

a bit Yes, billing effect. has cycle itself a just the of lag

to is the I So I'm illustrate that beginning. guess that's trying what

continued expect We improvement.

then And question, one final line. Got in it. I'll jump Perfect.

of we working that obviously, about a increase big cash maybe does accelerates? When that? cash operations, think from Just do decreased bit, year-over-year. capital get flow digested, flow a little sort How

growth. Yes. into of very we flow momentum. Overall, we're But going also positive some operating on course, There's expect cash XXXX.

bit falls year, the of in optimistic. from the but certainly temp a that, where growth, that timing out things it down that So we're could

cash We'll growth take it. Got and then flow.

back in it. Got I'll right. line. All Perfect. jump Okay.

The next from Moore comes from question Hutton. Chip EF

the on up get lag. I wanted Is you at underway think QX? that sort to through one about on the way billing actions that? in of RWS, to that that last you'd right that think Do follow fully

is, during Yes, Chip. I have think out the cycle would run second That it quarter.

Yes.

pipeline organic Perfect. side, the and then Okay. on quite sounds is And feel strong, growth good. the it you like

you structure. and mentioned the that comp elaborate seen I changing Maybe think what early you've on there. traction feedback and maybe and

grow gives Yes. speak client me little was I'm guys are the glad those is and What And on to customers ones customers did comp we about with to their that a you brought added structure on side. those care job that more. that customers. services those and a the the retain we It of take existing work them. chance up. to And with

added incentive So is lines an locations, expand in. bit new they what sell services of as a package we've

want lines up I acquisition customers customers. and a lines make these mentioned to and be. new going existing the shoot it -- guess, through sell goals source us been and of these maybe growth we And some has you'd and otherwise. to for. existing that give And many to Chip sets years, and that that for use relationships keep term we've to huge added to into add And folks the just use continue momentum skill -- their sure for folks upsell, want will these are to is I wonderful and such

that's what that's focused So on, really Chip.

It sounds like you're still I Perfect. on And opportunities things, the maybe guess, the side. M&A seeing just emerge. one, last

how you in just future deals maybe and what more layer you've the of integration. so you've might capabilities investments made you the feel places, data the RWS, talk With some that your on about some integrated about and other side learned now you on

and of be internal on as progress integrations do or making that where making, ahead. in internally, Quest the excited effective at we own about go nothing our us frankly, forward. look really I will couple enable we here quicker the I'm as think, to even investments been more I are, we're a the things. systems Yes, we've but And

So very we some plus, obviously. and obviously learnings, optimistic have I'm

integrate guess forward I the good we lot, I'm one. all our a about ability really we make and our eyes up right use do excited open the opportunistic time the really acquisitions. immediately and I'm for to we down, it's complementary, goes we word think when I Market Chip, keep but those keep accretive, be mind, excited move know ability make had one And quite we we well. do businesses. acquisitions, really our rest able and strategic The I an only had And about that in onboard. as improved really performed to with issue. to

So nice it's to we're be forward. going I our have right now. business don't think target really definitive to we that of a But doing part and going what acquisitions of a type relative thing from

fair. Understood. it. Appreciate Understood. That's

MKH The from next Management. from Melas comes question George

dig of Just deeper was sort X I wanted believe on it we RWS. businesses. can to little if bit that a

You Or them? equity Were both bought a separate like X bought and almost businesses private it it acquisition, that not made businesses. and a X of from were they you had those one problematic? recent firm was if It's integrated. different just totally

to how best Yes, figure I'm to trying out answer that.

of extremely didn't do, your that. firm We've aspects the already We've the them is us and First before of lot done it operating totally those separately. that combined was we've combined accurate. accounting. The that sales a assessment force, had they all,

that's the have that aligned standpoint fact, management everybody from I of from. of retail, related, at business both with think matter a most of side a in the of where a here that the of business, the lot does But from the the core As or it's that wasn't sides a REITs I commodity process departments issues standpoint. side we, would came really that say

full half? over slight then And EBITDA Okay. was think you positive in mentioned, the this the loss second Was that I the for Ray, year. RWS

to but that we don't exactly, it No, have it, I think Was an definitely how no. I positive. can't explain quarter? EBITDA remember negative. was Brett,

No.

So positive quarter? every it's EBITDA

don't specifically. George, I know,

down originally that we're we Yes, But that thought back get we to to of be this going the to year. level. would end business again, where by that break wouldn't

on with accomplish last we've so. we're the what positive the I main think overall been is takeaway, to very that's able acquisition quarter the over or

Okay. And then one just one. maybe final

Has a all say? sort factors said midyear, were from were half? the expect And similar been of a came of of Or lowered something there that that that half explain sort drop? the to some the year, an like I think there other you had guys of slightly that drop? sort EBITDA rate, perspective, second I'd does first RWS run the in meaningful in forecast,

way seasonality gets you that the business. most a the RWS rest makes of of Certainly, in large of with the Yes. the QX there. came core up

The Fund. Kitt next question comes from from Pinnacle Gregg

I RWS. was bit a unclear little about

about that in positive there But QX. the impact year. of course over the $X.X and talked that You million benefit was negative QX a impact in

so if that QX, net-net, QX was and surprise. positive I looked at And just net a

$X I for lot the million And negative was so think million, impact about in $X.X the million when $X year, a of that QX, plus? maybe like

items characterize item just in really previous the million. were adjustments, reconciling QX to and some $X.X Those QX from would back I quarters. No,

the the of the that million would year. $X.X as is that being look just largely out half to the on the missed at business and in upside certainly related So we more second

heard pieces gets profit EBITDA on January $X-ish Am on to adjustments kind the being basis. heard million you I that additional those and better improvements, any Absent run correctly? able bit get gross non-GAAP SG&A, of February, stock-based OpEx And plus to the I cycle like you And comp reading like of or million the and was the that you those I of little as you're a it million a of rate $X like and first is to through quarter. for Okay. to of for what expecting whatever made like million of $XX.XX then $X.XX kind adjustments fuel commentary sounded pass additional surcharges, some on.

really to that a I Yes, for out the out be point to and that's the not stabilized think January guidance coming has assessment. QX. it's but quarter, just business February, really meant of fair certainly,

And question was my last cash flow. Okay. around free

You had guided guys that. a had good cash flow quarter and to you

to flow. And was free so you see generate cash I positive excited

cash free some this year, you forward is EBITDA if wouldn't positive of year? million look we generating to kind flow this of there As teens high that reason to you did $XX be

at optimistic well. Yes. operating we're positive off building about as We're fell on from have QX. in that certainly the integration We'll costs some flow where cash

So of certainly, optimism going continue lot there's a and that, to that's increase.

comes ahead. next George question from MKH Please Melas go The from Management.

follow I SG&A. on Gregg's just to question on want up

it But will a that was transaction-related $X.X and of that use? if SG&A? a on was you other up Is expenses good stock-based $X.X take to sort that some during will the million million. some investments comp, XXXX? number bump normalized million. it quarter, Is that $X.X out there adjustments, This Or that roughly are

George, that going we the expenses that by QX. as be it's through we completed expect earlier call to take so to Brett. integration in -- Yes, I'll again. integrate the continue we mentioned those are

expect sorry, there there taper be to But other is off. would would expenses certainly continued the piece our that go -- some I So integration ahead.

No, you go ahead, I'm sorry.

say, just think right. to thinking about it was I going you're I No,

related SG&A, The other pieces the add-backs. would to be you called that out

Okay.

I expense half So in expenses will all $X.X third in have a to transaction-related or be could then a normalized stopped. integration-related be There sort way, some we the like maybe SG&A the or way they of quarter, guess could but first that rate, million. run the

fair. that's Yes,

over like back conference to would for This question-and-answer turn to Hatch I closing concludes the any remarks. Ray session. the

Thank you, I it. appreciate operator.

putting the unusual did want XXXX. the to And maybe is reason call, how and January mention the that and why positive. in I to feel of We the some positive an feel release. I we we press reason hopefully think illustrates just we of it go circumstance why throughout February back so mentioned go numbers about something again

QX. that learned lot. caused in issues We We've a adjusted the back it

of We have of ahead possibilities lot a growth us.

customers We've and and them. a got we're on. things We going positive great top building of of lot them expanding on within have

is of it's Our through throughout continue our or whether services We'll the breadth that pretty the capitalize proposition, data clearly value year. we're offering, marketplace. ringing on the to

I'm that. So excited about

turn the to for ongoing they optimistic date to out. I what We doing doing the working Quest. the All keeping team thank and interest up that. basis. importantly, And I that on initiatives I'm everybody been And they've they're come. the Quest you see thank forward of excited appreciate to look and, want quarters want a in to go-forward in deliver more to I all efforts right importantly, how to now. our very also for value well their are greatly to

very thank So you much.

concludes today's This conference call.

and day. disconnect for may you a Thank have lines. pleasant You participating, your