Executive Summary

Q3 2025 revenue was $575M (flat YoY) and Adjusted EBITDA was $74M; adjusted diluted EPS was $(0.08). Against S&P Global consensus, revenue was a slight beat ($575M vs $573.2M*), but EPS missed ($(0.08) vs $(0.03)) and Adjusted EBITDA missed ($74M vs ~$82.2M) .
Full-year 2025 guidance was cut: Adjusted EBITDA to $268–$278M (from $290–$310M) and Adjusted Free Cash Flow to $(30)–$(20)M (from $15–$35M). Q4 Adjusted EBITDA is guided to $62–$72M .
Clean Earth delivered another record quarter: revenue $250M (+6% YoY), Adjusted EBITDA $43M, margin 17.3%. Harsco Environmental improved sequentially (margin 17.0%), while Harsco Rail remained a drag with a $(4)M Adjusted EBITDA loss amid weak demand .
Strategic alternatives advanced: management discussed structures to unlock Clean Earth value and noted an amended credit agreement enabling a Clean Earth sale; they are “optimistic” the process concludes by year-end .

What Went Well and What Went Wrong

What Went Well

Clean Earth another record quarter with strong cash generation, driven by higher volumes and services pricing; revenue $250M (+6% YoY), Adjusted EBITDA $43M, margin 17.3% .
“Clean Earth delivered another record quarter with strong cash flow generation, driven by higher volumes and services pricing.” — CEO Nick Grasberger .
Harsco Environmental margin reached 17.0% in Q3; management said the business “troughed” in H1 and expects 2026 to be better, with cost-out actions and price increases to offset cost inflation .
Adjusted free cash flow improved to $6M in Q3 (from $(14)M in Q2), supported by working capital and capex controls; net cash from operating activities was $34M .

What Went Wrong

Harsco Rail remained the largest headwind: Adjusted EBITDA loss $(4)M with weak demand for standard equipment and aftermarket parts; Q4 rail results projected lower mainly due to volumes .
Consolidated Adjusted EBITDA declined YoY to $74M (vs $85M in Q3 2024), with lower contributions from Harsco Environmental and Rail; divestitures in HE also reduced EBITDA by ~$3M YoY .
Guidance cut: FY Adjusted EBITDA midpoint reduced by $27M and Adjusted FCF midpoint reduced by $50M, driven predominantly by rail, with some HE pressure from higher operating costs/new site contributions .

Financial Results

Metric	Q3 2024	Q1 2025	Q2 2025	Q3 2025
Revenue ($USD Millions)	$574	$548	$562	$575
Adjusted EBITDA ($USD Millions)	$85	$67	$65	$74
Adjusted EBITDA Margin %	14.8%	12.2%	11.5%	12.9%
Diluted EPS (GAAP) ($USD)	$(0.15)	$(0.15)	$(0.58)	$(0.26)
Adjusted Diluted EPS ($USD)	$(0.01)	$(0.18)	$(0.22)	$(0.08)

Segment breakdown (Q3 2025 vs Q3 2024):

Segment	Revenues Q3 2024 ($MM)	Op Inc (GAAP) Q3 2024 ($MM)	Adj EBITDA Q3 2024 ($MM)	Adj EBITDA Margin Q3 2024	Revenues Q3 2025 ($MM)	Op Inc (GAAP) Q3 2025 ($MM)	Adj EBITDA Q3 2025 ($MM)	Adj EBITDA Margin Q3 2025
Harsco Environmental	$279	$33	$53	19.0%	$261	$13	$44	17.0%
Clean Earth	$237	$27	$42	17.5%	$250	$27	$43	17.3%
Harsco Rail	$58	$(14)	$(2)	(4.3)%	$64	$(9)	$(4)	(5.7)%

KPIs (quarterly):

KPI	Q1 2025	Q2 2025	Q3 2025
Net Cash Provided by Operating Activities ($MM)	$6.6	$22.0	$34.4
Adjusted Free Cash Flow ($MM)	$(13.2)	$(14.0)	$5.6
Purchases of Property, Plant & Equipment ($MM)	$21.6	$39.0	$31.8

Estimates vs Actuals (Q3 2025):

Metric	S&P Global Consensus	Actual
Revenue ($USD)	$573.2M*	$574.8M
Primary EPS ($USD)	$(0.03)*	$(0.08)
Adjusted EBITDA ($USD)	$82.2M*	$74.4M

Values marked with * retrieved from S&P Global.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Adjusted EBITDA ($MM)	FY 2025	$290–$310	$268–$278	Lowered
Adjusted Free Cash Flow ($MM)	FY 2025	$15–$35	$(30)–$(20)	Lowered
GAAP Loss from Continuing Ops ($MM)	FY 2025	$(74)–$(56)	$(103)–$(93)	Lowered
GAAP Diluted EPS from Continuing Ops ($)	FY 2025	$(0.97)–$(0.75)	$(1.32)–$(1.20)	Lowered
Adjusted Diluted EPS from Continuing Ops ($)	FY 2025	$(0.52)–$(0.30)	$(0.74)–$(0.62)	Lowered
Net Cash Provided by Operating Activities ($MM)	FY 2025	$141–$171	$98–$118	Lowered
Net Interest Expense (ex unusual) ($MM)	FY 2025	$107–$110	$108–$110	Maintained (slightly higher low end)
Tax Expense (ex unusual) ($MM)	FY 2025	$26–$31	$22–$24	Lowered
Net Capital Expenditures ($MM)	FY 2025	$130–$140	$120–$130	Lowered
Adjusted EBITDA ($MM)	Q4 2025	N/A	$62–$72	New disclosure

Credit agreement amendment: net leverage covenant revised (5.25x YE’25; 5.00x YE’26; step down to 4.00x in Q2’27), enabling potential sale of Clean Earth and setting surviving capital structure framework .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q3 2025)	Trend
Supply chain & rail operations	Q2: Rail “ongoing operating challenges” and weak demand; Q1: progress on ETO contracts and leadership strengthening	Shop-floor bottlenecks lessened and supply chain improved; however demand for standard equipment/aftermarket remains weak	Mixed operational improvement; demand still weak
Tariffs/macro	Q1: Minimal direct exposure to tariffs; USD weakness net positive	EU proposed safeguard measures (higher import tariffs/lower quotas) likely to lift EU steel volumes for HE in 2026 if implemented	Potential 2026 tailwind for HE
Clean Earth performance	Q1: Adj EBITDA margin 16.2% ; Q2: 16.3%	Record quarter; margin 17.3%; volume growth from hazardous waste and pricing	Improving margins and growth
Harsco Environmental	Q2: HE margin 15.5%; divestitures/site exits weighed	Margin 17.0%; sequential improvement; cost inflation being addressed via cost-out and pricing in 2026	Sequential improvement; 2026 outlook better
Rail ETO contracts	Q1: favorable amendment impact; ongoing progress	DB homologation for first three vehicles expected into H1’26; SBB first group deliveries by Jan’26, second type by early 2027; Network Rail renegotiations ongoing (seek improved economics or exit)	De-risking; milestone clarity (2026–27)
Strategic alternatives & capital structure	Q2: formal process initiated	Considering sale of Clean Earth plus taxable spin of HE/Rail; amended credit agreement to enable separation; targeted conclusion by year-end	Accelerating; year-end decision targeted

Management Commentary

“Clean Earth delivered another record quarter with strong cash flow generation, driven by higher volumes and services pricing… On a consolidated basis, our results were impacted primarily by Harsco Rail, due to weak demand… Given the mixed performance in the quarter, we’ve lowered our full year outlook.” — CEO Nick Grasberger .
Strategic alternatives: “We have seen strong and definitive interest in our Clean Earth business… one [structure] involves a simultaneous sale of Clean Earth together with a taxable spin… We believe we should be in a position to conclude our process review prior to the end of this year.” — CEO Nick Grasberger .
CFO on Q3 drivers and outlook: “Unusual items totaled $12M pre-tax… adjusted free cash flow for the quarter was $6M… The midpoint of EBITDA guidance is reduced by $27M, and… free cash flow… by $50M… Q4 adjusted EBITDA is expected to range from $62–$72M” .

Q&A Highlights

Sale process timeline and valuation: Management reiterated strong interest in Clean Earth and aim to conclude by year-end; multiples expected to be consistent with precedent transactions .
Guidance cut composition: Predominantly rail; removal of volumes not supported by firm orders or pipeline visibility; HE lowered modestly as Q3 pace persists into Q4 .
Clean Earth SDM vs hazardous waste: FY hazardous waste EBITDA expected up ~15% and SDM down ~15% due to project timing/mix; SDM backlog remains attractive .
Rail baseline EBITDA: Longer-term standalone base business modeled at ~$35–$40M; current depressed demand implies ~$30M run rate .

Estimates Context

Q3 2025 actuals versus S&P Global consensus: revenue modest beat ($574.8M vs $573.2M*), EPS miss ($(0.08) vs $(0.03)), Adjusted EBITDA miss ($74.4M vs ~$82.2M). Combined with lowered FY and Q4 guidance, Street models for rail and HE are likely to be revised down, with CE estimates supported by record performance . Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

Clean Earth is the bright spot with sustained margin expansion (17.3%) and record earnings, supporting the thesis of portfolio value unlock via potential sale .
Rail remains the principal earnings drag; demand weakness and negative mix drove an Adjusted EBITDA loss and the majority of the FY guidance cut .
Harsco Environmental improved sequentially and could benefit from EU steel safeguards in 2026; near-term cost inflation/new site contributions weigh on results .
FY 2025 guidance reset (Adj EBITDA $268–$278M; FCF $(30)–$(20)M) and Q4 EBITDA $62–$72M frame a more conservative near-term setup .
Strategic alternatives catalyze the story: amended credit agreement enables Clean Earth sale; post-transaction net leverage targeted ~2x initially (max 3x), improving equity narrative for HE/Rail .
Non-GAAP adjustments were material in Q3 (e.g., strategic costs $5.3M; employee termination $6.0M; contract loss provision $1.6M), impacting GAAP EPS; focus remains on de-risking ETO projects .
Q3 underperformed prior Q3 outlook (company guided $76–$86M vs actual $74M), underscoring conservative positioning for Q4 and FY .

ENVIRI Corp (NVRI)·Q3 2025 Earnings Summary