Stericycle Inc (SRCL) 2023 Q1 法說會逐字稿

Hello, and welcome to the Q1 2023 Stericycle Earnings Conference Call. My name is Elliot, and I'll be coordinating your call today. (Operator Instructions)

您好，歡迎來到 2023 年第一季度 Stericycle 收益電話會議。我叫 Elliot，今天我將負責協調您的來電。 （操作員說明）

I would now like to hand over to Andrew Ellis, Vice President of Investor Relations. The floor is yours. Please go ahead.

現在，我想請投資者關係副總裁安德魯·埃利斯 (Andrew Ellis) 發言。地板是你的。請繼續。

Good morning, and thank you for joining Stericycle's 2023 First Quarter Earnings Call. On the call today will be Cindy Miller, our Chief Executive Officer; and Janet Zelenka, our Chief Financial Officer and Chief Information Officer.

早上好，感謝您參加 Stericycle 的 2023 年第一季度財報電話會議。我們的首席執行官 Cindy Miller 將出席今天的電話會議；以及我們的首席財務官兼首席信息官 Janet Zelenka。

The discussion today includes forward-looking statements that involve risks and uncertainties. When we use words such as believes, expects, anticipates, estimates, may, plan, will, goal or similar expressions, we are making forward-looking statements. Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of our management about future events and are, therefore, subject to risks and uncertainties.

今天的討論包括涉及風險和不確定性的前瞻性陳述。當我們使用相信、期望、預期、估計、可能、計劃、意願、目標或類似表達方式時，我們是在做出前瞻性陳述。前瞻性陳述本質上是前瞻性的，並非基於歷史事實，而是基於我們管理層對未來事件的當前預期和預測，因此存在風險和不確定性。

Our actual results could differ significantly from those described in such forward-looking statements. Factors that could our actual results to differ are discussed in the safe harbor statement in our earnings press release and in greater detail within the risk factors in our filings with the U.S. Securities and Exchange Commission. Our past financial performance should not be considered a reliable indicator of our future performance, and investors should not use historical results to anticipate future results or trends. We disclaim any obligation to update or revise any forward-looking statement other than in accordance with legal and regulatory obligations.

我們的實際結果可能與此類前瞻性陳述中描述的結果大不相同。我們的實際結果可能會有所不同的因素在我們的收益新聞稿中的安全港聲明中進行了討論，並在我們向美國證券交易委員會提交的文件中的風險因素中進行了更詳細的討論。我們過去的財務業績不應被視為我們未來業績的可靠指標，投資者不應使用歷史結果來預測未來的結果或趨勢。除法律和監管義務外，我們不承擔任何更新或修改任何前瞻性陳述的義務。

On the call, we will discuss non-GAAP financial measures. For additional information and reconciliation to the most comparable U.S. GAAP measures, please refer to the schedules in our earnings press release, which can be found on Stericycle's Investor Relations website at investors.starcycle.com. The prepared comments for today's call correspond to an earnings presentation, which is also available at Stericycle's Investor Relations website. Throughout the call, we will reference specific slides from the presentation.

在電話會議上，我們將討論非 GAAP 財務指標。有關更多信息以及與最具可比性的美國 GAAP 指標的對賬，請參閱我們的收益新聞稿中的時間表，該新聞稿可在 Stericycle 的投資者關係網站 investors.starcycle.com 上找到。為今天的電話會議準備的評論與收益報告相對應，該報告也可在 Stericycle 的投資者關係網站上獲得。在整個通話過程中，我們將參考演示文稿中的特定幻燈片。

This call is being recorded, and a replay will be available approximately 1 hour after the end of the conference call today until May 25, 2023. A replay of the webcast will be available on Stericycle's Investor Relations website. Time-sensitive information provided during today's call, which is occurring on April 27, 2023, may no longer be accurate at the time of a replay. Any redistribution, retransmission or rebroadcast of this call in any form without the expressed written consent of Stericycle is prohibited.

此電話會議正在錄音中，重播將在今天電話會議結束後約 1 小時提供，直至 2023 年 5 月 25 日。網絡廣播的重播將在 Stericycle 的投資者關係網站上提供。在 2023 年 4 月 27 日舉行的今天的電話會議中提供的時間敏感信息在重播時可能不再準確。未經 Stericycle 明確書面同意，禁止以任何形式重新分發、轉發或轉播此電話。

I'll now turn the call over to Cindy.

我現在將電話轉給 Cindy。

Thank you, Andrew, and good morning, everyone, and welcome to today's call. Overall, I am pleased with our first quarter performance, which is in line with our expectations for the year. We saw a solid performance and progress across our key business priorities.

謝謝安德魯，大家早上好，歡迎來到今天的電話會議。總的來說，我對我們第一季度的表現感到滿意，這符合我們對今年的預期。我們在關鍵業務優先事項方面取得了穩健的業績和進展。

Turning to our first quarter results. Our revenue performance benefited from the commercial actions started in 2022, which included leveraging our pricing actions. We delivered another quarter of overall organic revenue growth, growing 7.2% with secure information destruction increasing 11.8% and regulated Waste and Compliance Services increasing 5%. We are showing good progress on our quality of revenue initiatives that I discussed last quarter, which includes our commitment to expanding service penetration, improving customer implementation's velocity and deepening customer partnerships by developing enhanced customer solutions.

轉向我們的第一季度業績。我們的收入表現得益於 2022 年開始的商業行動，其中包括利用我們的定價行動。我們又實現了四分之一的總體有機收入增長，增長 7.2%，其中安全信息銷毀增長 11.8%，受監管的廢物和合規服務增長 5%。我們在上個季度討論的收入質量計劃方面取得了良好進展，其中包括我們致力於擴大服務滲透率、提高客戶實施速度以及通過開發增強型客戶解決方案深化客戶合作夥伴關係。

In the quarter, gross profit margin expanded 130 basis points. Our actions on operational efficiencies, particularly in the areas of staffing and reduced overtime have helped us offset increases in other costs such as fleet and facilities, allowing revenue growth to largely flow through to gross profit.

本季度，毛利率擴大了 130 個基點。我們在運營效率方面採取的行動，特別是在人員配備和減少加班方面，幫助我們抵消了車隊和設施等其他成本的增加，從而使收入增長在很大程度上流向了毛利潤。

We continue to be encouraged by what we see being reported in the market with hospital staffing levels shoring up, return of elective surgeries and return to office trends. As a market leader in our core businesses, offering solutions and compliance support, we are well positioned to take advantage of these trends as they evolve.

我們繼續對我們在市場上看到的報告感到鼓舞，包括醫院人員配備水平的提高、擇期手術的恢復和重返辦公室的趨勢。作為我們核心業務的市場領導者，提供解決方案和合規支持，我們有能力在這些趨勢發展的過程中利用它們。

Our infrastructure modernization efforts, including existing and additional future treatment capacity strategically placed in key geographic areas, positions us well to support growth in our customer base. Further, we are pleased with our cash flow generation and strengthened balance sheet.

我們的基礎設施現代化工作，包括戰略性地放置在關鍵地理區域的現有和額外的未來處理能力，使我們能夠很好地支持我們客戶群的增長。此外，我們對我們產生的現金流量和增強的資產負債表感到滿意。

With regards to our operational modernization efforts, our new incinerator under construction in Nevada remains on schedule to go live in early 2024. We also have 20 additional projects underway, which include new auto clogs and conveyance systems.

關於我們的運營現代化工作，我們在內華達州正在建設的新焚化爐仍按計劃於 2024 年初投入使用。我們還有 20 個其他項目正在進行中，其中包括新的汽車堵塞和運輸系統。

Regarding our fleet modernization initiative, although vehicle deliveries remain behind schedule. To date, we have received almost 80% of our outstanding orders and anticipate receiving the remaining vehicles by mid to late summer. Looking ahead to the U.S. regulated Waste and Compliance Services ERP deployment, the team is currently immersed in testing and readiness preparation and we continue to anticipate deploying it in the second half of 2023.

關於我們的車隊現代化計劃，儘管車輛交付仍落後於計劃。迄今為止，我們已經收到了近 80% 的未完成訂單，並預計將在夏中至夏末收到剩餘的車輛。展望美國監管的廢物和合規服務 ERP 部署，該團隊目前正忙於測試和準備工作，我們繼續預計在 2023 年下半年部署它。

Now turning to debt reduction. We improved our debt leverage ratio to 3.05x, a 23-point improvement since year-end, and we remain on track to achieve our 3x debt leverage ratio in the first half of 2023. This is our lowest debt leverage ratio since 2015.

現在轉向減少債務。我們將債務槓桿率提高至 3.05 倍，自年底以來提高了 23 個百分點，並且我們有望在 2023 年上半年實現 3 倍的債務槓桿率。這是我們自 2015 年以來的最低債務槓桿率。

Finishing with portfolio optimization. In April, we divested our operations in Brazil, which was our last remaining Latin America business for an investing cash outflow of approximately $28 million. This represents our 13th divestiture since 2019.

完成投資組合優化。 4 月，我們剝離了在巴西的業務，這是我們最後剩下的拉丁美洲業務，投資現金流出約為 2800 萬美元。這是我們自 2019 年以來的第 13 次資產剝離。

I'll now turn the call over to Janet to review our financial results.

我現在將電話轉給珍妮特來審查我們的財務業績。

Thank you, Cindy. I will start by summarizing our first quarter results. As noted on Slide 5, revenues in the first quarter were $684.3 million compared to $664.2 million in the first quarter of last year. Excluding the net impact of divestitures of $16.6 million and unfavorable foreign exchange rates of $10 million, organic revenues increased $46.7 million. Of this increase, secure information destruction organic revenue growth was $24.9 million and Regulated Waste and Compliance Services organic revenue growth was $21.8 million.

謝謝你，辛迪。我將首先總結我們第一季度的業績。如幻燈片 5 所示，第一季度的收入為 6.843 億美元，而去年第一季度為 6.642 億美元。排除 1660 萬美元資產剝離和 1000 萬美元不利匯率的淨影響，有機收入增加了 4670 萬美元。在這一增長中，安全信息銷毀有機收入增長為 2490 萬美元，受管制廢物和合規服務有機收入增長為 2180 萬美元。

As noted on Slide 6, Regulated Waste and Compliance Services revenues were $451.3 million compared to $452.6 million in the first quarter of 2022. Excluding the impact of divestitures and foreign exchange rates, organic revenues increased 5% in the first quarter.

如幻燈片 6 所示，受管制廢物和合規服務收入為 4.513 億美元，而 2022 年第一季度為 4.526 億美元。排除資產剝離和匯率的影響，第一季度有機收入增長了 5%。

In North America, Regulated Waste and Compliance Services organic revenues increased $22.4 million or 6.5%, mainly driven by our 3 pricing levers, which include: pricing in existing contracts; new customer pricing; and surcharges and fees.

在北美，Regulated Waste and Compliance Services 的有機收入增長了 2240 萬美元或 6.5%，這主要是由我們的 3 個定價槓桿推動的，其中包括：現有合同的定價；新客戶定價；以及附加費和費用。

International Regulated Waste and Compliance Services organic revenues declined $0.6 million or 0.7% in the first quarter. This decline was due to wage volumes compared to the first quarter of 2022.

International Regulated Waste and Compliance Services 有機收入在第一季度下降了 60 萬美元或 0.7%。這一下降是由於與 2022 年第一季度相比工資量有所下降。

Secure information destruction delivered revenues of $233 million compared to $211.6 million in the first quarter of 2022. Excluding the impact of foreign exchange rates, organic revenues for secure information destruction increased 11.8% mainly due to pricing and higher recycled paper revenues.

安全信息銷毀的收入為 2.33 億美元，而 2022 年第一季度為 2.116 億美元。排除匯率的影響，安全信息銷毀的有機收入增長了 11.8%，這主要是由於定價和更高的再生紙收入。

In North America, secure information destruction organic revenues increased $24.3 million or 13.4% compared to the first quarter of 2022. Of this 13.4% growth, service revenues contributed 10.8% and recycling paper revenues contributed 2.6%. The service revenue growth was mainly due to our 3 pricing levers, including fuel and environmental and recycling recovery surcharges. Recycled paper contributed approximately $4.8 million more than in the first quarter of 2022, reflecting mainly higher SOP pricing.

在北美，與 2022 年第一季度相比，安全信息銷毀有機收入增加了 2430 萬美元或 13.4%。在這 13.4% 的增長中，服務收入貢獻了 10.8%，回收紙收入貢獻了 2.6%。服務收入的增長主要歸功於我們的 3 個定價槓桿，包括燃料和環境以及回收附加費。再生紙比 2022 年第一季度貢獻了約 480 萬美元，主要反映了更高的 SOP 定價。

In International, secure information destruction organic revenues increased $0.6 million or 2.1% compared to the first quarter of 2022. This change was mainly due to pricing levers offsetting reduced volumes.

在國際市場，安全信息銷毀的有機收入與 2022 年第一季度相比增加了 60 萬美元或 2.1%。這一變化主要是由於定價槓桿抵消了銷量的下降。

Income from operations in the first quarter was $40 million compared to $5.9 million in the first quarter of 2022. The $34.1 million increase was mainly due to gross profit improvement of $16.5 million, primarily driven by revenue flow-through and lower selling, general and administrative expenses of $22.6 million, mainly due to lower adjusted items and bad debt expense. These were partially offset by a divestiture loss of $5 million.

第一季度的運營收入為 4000 萬美元，而 2022 年第一季度為 590 萬美元。增加 3410 萬美元主要是由於毛利潤增加了 1650 萬美元，這主要是由於收入流轉和較低的銷售、一般和行政管理費用為 2260 萬美元，主要是由於調整後的項目和壞賬費用較低。這些被 500 萬美元的資產剝離損失部分抵消。

U.S. GAAP net income was $11.2 million or $0.12 diluted earnings per share compared to a net loss of $14.2 million or $0.15 diluted loss per share in the first quarter of 2022. The $25.4 million increase was mainly due to higher income from operations of $34.1 million, as I previously explained, partially offset by higher income tax expense of $5.6 million and interest expense of $4.1 million.

美國公認會計原則淨收入為 1120 萬美元或攤薄後每股收益 0.12 美元，而 2022 年第一季度為淨虧損 1420 萬美元或攤薄後每股虧損 0.15 美元。增加 2540 萬美元主要是由於運營收入增加 3410 萬美元，正如我之前解釋的那樣，部分被 560 萬美元的所得稅費用和 410 萬美元的利息費用所抵消。

Cash flow from operations for the 3 months ended March 31, 2023, was an inflow of $49.5 million compared to an outflow of $38.8 million in the same period of 2022. The year-over-year increase of $88.3 million was mainly driven by accounts receivable of $32.9 million due to an improvement in days sales outstanding, higher operating income of $30.8 million, lower annual incentive compensation payments of $22.3 million and other net working capital improvements of $2.3 million.

截至 2023 年 3 月 31 日止三個月的運營現金流為流入 4,950 萬美元，而 2022 年同期為流出 3,880 萬美元。同比增長 8,830 萬美元，主要受應收賬款推動由於未償銷售天數的改善、營業收入增加 3080 萬美元、年度激勵薪酬減少 2230 萬美元以及其他淨營運資本增加 230 萬美元，收入減少 3290 萬美元。

Adjusted income from operations was $84.7 million or 12.4% as a percentage of revenues, up from $59 million or 8.9% as a percentage of revenues in the first quarter of last year. Adjusted income from operations increased 350 basis points as a percentage of revenues due to the following: one, gross profit flow-through of approximately 130 basis points, mainly due to pricing; and two, lower selling, general and administrative expenses of approximately 210 basis points, mainly due to improved operating leverage against higher revenues and lower bad debt expense.

調整後的運營收入為 8470 萬美元或占收入的 12.4%，高於去年第一季度的 5900 萬美元或占收入的 8.9%。由於以下原因，調整後的運營收入佔收入的百分比增加了 350 個基點：一是毛利潤流轉約 130 個基點，主要是由於定價；第二，銷售、一般和管理費用降低約 210 個基點，這主要是由於經營槓桿的提高導致收入增加和壞賬費用減少。

As noted on Slide 8, adjusted diluted earnings per share was $0.49 compared to $0.32 in the first quarter of 2022. Excluding the impact from divestitures and foreign exchange rates of $0.02, the remaining $0.19 year-over-year increase was driven by $0.20 from gross profit flow-through, $0.01 from lower selling, general and administrative expenses and $0.01 from lower income tax expense and others. These were partially offset by $0.03 from higher interest expense.

如幻燈片 8 所述，調整後的攤薄每股收益為 0.49 美元，而 2022 年第一季度為 0.32 美元。排除資產剝離和匯率 0.02 美元的影響，其餘 0.19 美元的同比增長是由總收入 0.20 美元推動的利潤流轉，0.01 美元來自較低的銷售、一般和管理費用，0.01 美元來自較低的所得稅費用和其他費用。這些被較高的利息支出 0.03 美元部分抵消。

Capital expenditures for the 3 months ended March 31, 2023, were $36.4 million compared to $37.5 million for the same period last year.

截至 2023 年 3 月 31 日止三個月的資本支出為 3640 萬美元，而去年同期為 3750 萬美元。

Free cash flow for the 3 months ended March 31, 2023, was an inflow of $13.1 million compared to an outflow of $76.3 million in the same period of 2022. As noted on Slide 9, the year-over-year improvement of $89.4 million was mainly due to higher cash flow from operations of $88.3 million.

截至 2023 年 3 月 31 日止三個月的自由現金流流入 1310 萬美元，而 2022 年同期流出 7630 萬美元。如幻燈片 9 所示，同比增長 8940 萬美元主要是由於運營產生的現金流量增加了 8830 萬美元。

Our first quarter DSO, as reported, was 56 days compared to a DSO of 63 days in the first quarter of 2022. The difference was mainly driven by prior year timing of North America secure information destruction customer billing and collections.

據報導，我們第一季度的 DSO 為 56 天，而 2022 年第一季度的 DSO 為 63 天。差異主要是由前一年北美安全信息銷毀客戶計費和收集的時間造成的。

As shown on Slide 10, at the end of the first quarter, our credit agreement defined debt leverage ratio was 3.05x, and our net debt was approximately $1.45 billion. As Cindy noted, we divested operations in Brazil in April for cash consideration paid of approximately $28 million. The cash consideration included coverage of debt-like related long-term liabilities, which will be removed from our balance sheet in the second quarter. The transaction is expected to result in a second quarter divestiture pretax loss of approximately $100 million, mainly due to noncash accumulated foreign exchange adjustments of $72 million.

如幻燈片 10 所示，在第一季度末，我們的信貸協議定義的債務槓桿率為 3.05 倍，我們的淨債務約為 14.5 億美元。正如 Cindy 指出的那樣，我們在 4 月份剝離了巴西的業務，以支付約 2800 萬美元的現金對價。現金對價包括與債務相關的長期負債，這些負債將在第二季度從我們的資產負債表中刪除。該交易預計將導致第二季度約 1 億美元的資產剝離稅前虧損，主要是由於 7200 萬美元的非現金累計外匯調整。

In 2022, the business in Brazil was unprofitable, unfavorably impacted adjusted EBITDA margin by approximately 20 basis points on a consolidated basis. Also in April, we made substantially all of the remaining FCPA settlement payments, which totaled about $8 million.

2022 年，巴西的業務無利可圖，對調整後的 EBITDA 利潤率產生了不利影響，在綜合基礎上下降了約 20 個基點。同樣在 4 月，我們幾乎支付了所有剩餘的 FCPA 和解款項，總額約為 800 萬美元。

Our first quarter results were aligned with our full year 2023 guidance, as shown on Slide 11, and our guidance ranges remain the same. I will now turn the call back to Cindy.

我們的第一季度業績與我們的 2023 年全年指導一致，如幻燈片 11 所示，我們的指導範圍保持不變。我現在將電話轉回給 Cindy。

Thank you, Janet. Earlier this month, we had an opportunity to host a Single Leadership Summit, which was attended by over 300 leaders across our organization. This was an amazing opportunity to celebrate the progress we've made in transforming this business over the past few years and engaged and energized the team on advancing the next aspects of our journey. As always, I'd like to thank our customers, team members, the communities we serve and our shareholders for their continued trust in having Stericycle protect what matters.

謝謝你，珍妮特。本月早些時候，我們有機會舉辦單一領導峰會，我們組織的 300 多位領導人出席了會議。這是一個難得的機會來慶祝我們在過去幾年中在業務轉型方面取得的進展，並讓團隊參與進來並激勵他們推進我們旅程的下一個方面。一如既往，我要感謝我們的客戶、團隊成員、我們所服務的社區和我們的股東，感謝他們對 Stericycle 保護重要事物的持續信任。

Operator, please open the line for Q&A.

接線員，請打開Q&A線路。

(Operator Instructions) Our first question today comes from Sean Dodge from RBC Capital Markets.

（操作員說明）我們今天的第一個問題來自 RBC Capital Markets 的 Sean Dodge。

Yes. Congrats again on the great progress in the quarter. Cindy, maybe just starting -- if we can start with an update on the inflation or the cost backdrop. I guess this has been in pretty steady decline for 6 months now. What's labor been like? And how cost has been trending for trucks and supplies? I guess the surcharges and structure you have in place now, are those sufficient you think to continue offsetting all of this? Or are these not normalizing fast enough where you think there still needs to be some work done around maybe incrementing some of those out?

是的。再次祝賀本季度取得的巨大進步。辛迪，也許才剛剛開始——如果我們可以從通貨膨脹或成本背景的最新情況開始。我猜這 6 個月以來一直在穩步下降。勞動是怎樣的？卡車和用品的成本趨勢如何？我猜你現在的附加費和結構是否足以繼續抵消所有這些？還是這些規範化速度不夠快，您認為仍然需要做一些工作來解決可能增加其中一些問題的問題？

Yes. Sean, thanks for that. That's a great question. Actually, what we are seeing is inflation, we still see it in -- and it's not equal across everything, but I'll give you an example. While we are starting to see some of our vehicles that we had ordered come in. So a little bit of supply chain ease, the one thing as we are seeing continued inflation is when we look at maintenance costs and we look at rental costs, they still are pretty elevated. So for us, that's something that really hasn't changed, and it behooves us -- we're going to be in much better state once we get that full vehicle fleet or vehicle order in. So that we kind of get out of the rental business and then we've got newer vehicles that will not have as much maintenance required.

是的。肖恩，謝謝你。這是一個很好的問題。事實上，我們看到的是通貨膨脹，我們仍然看到它——它並不是在所有地方都一樣，但我會給你舉個例子。雖然我們開始看到我們訂購的一些車輛進來了。所以供應鏈有點放鬆，我們看到持續通貨膨脹的一件事是當我們查看維護成本和租金成本時，他們仍然相當高。所以對我們來說，這確實沒有改變，這對我們來說是理所當然的——一旦我們獲得完整的車隊或車輛訂單，我們將處於更好的狀態。這樣我們就可以擺脫困境租賃業務，然後我們有更新的車輛，不需要那麼多的維護。

If you take a look at inflation rates that are in a lot of the leases for our facilities and a lot of other things that we signed, that came up for renewal during times when inflation was exceptionally high. If you want to say even Q1 of last year, when it broke a 40-year record high. So we still have leases that are going to continue with some of those pricings in there because you obviously signed them for a certain year period.

如果你看一下我們設施的許多租約和我們簽署的許多其他東西中的通貨膨脹率，就會發現在通貨膨脹異常高的時期需要續簽。如果你想說去年第一季度，當它打破了 40 年的歷史新高時。因此，我們仍然有租約，這些租約將繼續使用其中的一些定價，因為您顯然在特定年份簽署了它們。

And you had mentioned wages. I think the good news on wages for us is our staffing has stabilized. And as I've always said, with a stable workforce, you can start to make some efficiencies and that really, really drive some good thing. However, those -- that stability has come at a higher wage rate, kind of a run rate than we've seen. I don't see that getting -- we're not saying that's getting any worse. We're very pleased with where we are. But obviously, those continue to be in the run rate of the business. So overall, I think there are still some pockets where we're seeing some pretty strong inflationary pressure. But we'll see how that continues throughout the rest of the year.

你提到了工資。我認為對我們來說，工資方面的好消息是我們的人員配置已經穩定。正如我一直說的那樣，有了穩定的員工隊伍，你就可以開始提高效率，這真的會帶來一些好事。然而，那些 - 這種穩定性是在更高的工資率下實現的，這種運行率比我們所看到的要高。我沒有看到 - 我們並不是說情況變得更糟。我們對我們所處的位置感到非常滿意。但很明顯，這些仍然在業務運行率之內。所以總的來說，我認為仍然有一些地方我們看到一些相當強大的通脹壓力。但我們將看到這種情況在今年餘下時間裡將如何持續。

Okay. And then just clarifying on the contribution from the 2 surcharges, Janet, I think you said 130 basis point lifted gross margins in the quarter. My math would put that at about $9 million. That would be down just a little bit from the $10 million in the fourth quarter. Is that just because there was some pickup you captured early in last year? And so the $9 million would be incremental? Or why else would that decline sequentially?

好的。然後只是澄清 2 項附加費的貢獻，珍妮特，我想你說過 130 個基點提高了本季度的毛利率。我的數學估計約為 900 萬美元。這比第四季度的 1000 萬美元略有下降。那隻是因為你在去年早些時候捕獲了一些皮卡嗎？那麼這 900 萬美元是增量的嗎？或者為什麼會依次下降？

And then if we think kind of this you shifted the SOP schedule up again, I think that went into mid-February, so with that in place, how should we think about kind of surcharges those contribute incrementally in Q2 and maybe over the remainder of the year?

然後，如果我們考慮到這一點，你再次將 SOP 時間表提前，我認為那是在 2 月中旬，所以有了這個，我們應該如何考慮那些在第二季度甚至可能在剩餘時間內逐漸增加的附加費那一年？

Yes. So as you think about Q1 and our ability, we put surcharges in RWCS later in the year, and we didn't have any in the first quarter of last year to speak of in RWCS other than some existing legacy. And then we continue to modify the floors that are existing on the FID surcharge for paper and just continue to tune all our pricing levers that we had, which are 3 through last year.

是的。因此，當你考慮第一季度和我們的能力時，我們在今年晚些時候在 RWCS 中增加了附加費，去年第一季度除了一些現有的遺產外，我們在 RWCS 中沒有任何可談的。然後我們繼續修改 FID 紙張附加費中現有的下限，並繼續調整我們擁有的所有定價槓桿，即去年的 3 個。

So what you're seeing is the benefit of all those levers hitting Q1 very solidly where we didn't have as many in place or -- and some were not even existing in Q1 of last year. So sequentially, you're going to get noise just based on what's happening in the scheme of things. But we're really pleased that the sustainability of the surcharges. And as we go forward in the year, you will see that we're going to lap some of that pricing that we put in the market and particularly in the second half of the year. So that's why the first quarter is looking that strong in that surcharge range.

所以你所看到的是所有這些槓桿的好處非常穩固地影響了第一季度，而我們沒有那麼多，或者 - 有些甚至在去年第一季度都不存在。所以順序地，你會根據事情的計劃中發生的事情得到噪音。但我們真的很高興附加費的可持續性。隨著我們今年的前進，你會看到我們將對我們投放市場的一些定價進行調整，尤其是在今年下半年。這就是為什麼第一季度在附加費範圍內看起來如此強勁的原因。

Our next question comes from David Manthey from Baird.

我們的下一個問題來自 Baird 的 David Manthey。

Along the same lines here, when you think about approximate contract pricing, so the other 2 levers beyond surcharges, when we think about the 5% organic growth in RWCS, approximately how much do you think is related to those new contracts that are priced higher? And when you think about that -- those 2 levers of pricing, I assume some of that carries through the year. You probably have additional actions through the year. Does that remain constant or move up or down?

沿著同樣的思路，當你考慮近似合同定價時，除了附加費之外的其他 2 個槓桿，當我們考慮 RWCS 5% 的有機增長時，你認為大約有多少與定價更高的新合同有關？當你想到這一點時——這兩個定價槓桿，我假設其中一些會貫穿全年。你可能在這一年中有額外的行動。那是保持不變還是向上或向下移動？

Yes. So if you look -- I'll just start with -- if you look at our 3% to 5% growth rate for the year, we are reiterating that and that's because you're going to stop some of the pricing actions. However, we continue to leverage both of those prices levers, which is renewal. And also at the beginning of the year, the CPI that we put in contracts, renewals, the higher packing and continue to tune surcharges according to what we see in inflation. I'll turn it over to Cindy if she has any other...

是的。因此，如果你看 - 我只是開始 - 如果你看一下我們今年 3% 到 5% 的增長率，我們重申這一點，那是因為你將停止一些定價行動。然而，我們繼續利用這兩種價格槓桿，即更新。同樣在年初，我們將 CPI 納入合同、續約、更高的包裝，並根據我們在通貨膨脹中看到的情況繼續調整附加費。我會把它交給辛迪，如果她有任何其他...

Yes. I think on the RWCS side, David, it's important to note. As we had said, Q1 of '22 was a very difficult quarter for us. If we take a look, I mentioned the inflation. We had tremendous staffing issues. They were just major supply chain disruptions. And really, we were still kind of getting our sea legs from the ERP deployment in Shred. So that's -- while that's on the Shred side.

是的。我認為在 RWCS 方面，大衛，注意這一點很重要。正如我們所說，22 年第一季度對我們來說是一個非常困難的季度。如果我們看一下，我提到了通貨膨脹。我們遇到了巨大的人員配置問題。它們只是主要的供應鏈中斷。實際上，我們仍然在某種程度上從 Shred 中的 ERP 部署中獲得了成功。這就是 - 雖然那是在切碎方面。

On The RWCS, I think as we move throughout the year, a positive note, I think, is the return of elective surgeries as we move through. So this won't be purely -- our plan is not to have purely be a price story, which this year's Q-over-Q turns out to be as such, simply because we didn't have those pricing levers in Q1 of last year. But we see and we're very encouraged by the return of elective surgeries. Now all hospitals don't rebound at the exact same time. However, we built into this year's plan, the thought that surgeries would come back. So for us, it was a positive sign that we're seeing there. And I think RWCS is well positioned to continue to hit the plan for end of the year.

在 RWCS 上，我認為隨著我們全年的移動，一個積極的跡像是，我認為，隨著我們的移動，擇期手術的回歸。所以這不會純粹 - 我們的計劃不是純粹的價格故事，今年的 Q-over-Q 結果就是這樣，僅僅是因為我們在去年第一季度沒有這些定價槓桿年。但我們看到，我們對擇期手術的回歸感到非常鼓舞。現在所有醫院都不會同時反彈。然而，我們在今年的計劃中加入了手術會恢復的想法。所以對我們來說，這是一個積極的跡象，我們在那裡看到了。而且我認為 RWCS 已準備好繼續實現年底的計劃。

Okay. And second, Janet, when we just ask about long-term EBITDA margin targets, you would tell us that most of the free cash flow improvement you expected to see was due to higher profitability across the P&L. And then we can back into EBITDA margins of low to mid-20s. Does that math still hold for the changes that have happened in the business as well as the adjusted free cash flow targets that you moved last quarter? Just trying to get a read on ultimately where we're headed.

好的。其次，珍妮特，當我們只詢問長期 EBITDA 利潤率目標時，您會告訴我們，您期望看到的大部分自由現金流改善是由於整個損益表的盈利能力更高。然後我們可以回到 20 年代中期的 EBITDA 利潤率。對於業務中發生的變化以及您上個季度調整後的自由現金流量目標，該數學是否仍然適用？只是想了解一下我們最終的發展方向。

Our long-term outlook stays the same as that I issued in February. Does that answer your question? So it is, yes, 13% to 17% adjusted EBITDA growth rate, which drives those higher margin rates and the free cash flow conversion rate of 50% to 60% with the following then and through 2027. And then an annual CAGR of 3% to 5% in revenue growth. So those are all...

我們的長期展望與我在 2 月份發布的展望相同。這是否回答你的問題？因此，是的，調整後的 EBITDA 增長率為 13% 至 17%，這推動了更高的利潤率和 50% 至 60% 的自由現金流轉換率，隨後一直到 2027 年。然後年復合增長率為 3 % 至 5% 的收入增長。所以那些都是...

Yes, directionally, you're definitely, yes, you're on track.

是的，在方向上，你肯定是，是的，你在正軌上。

Yes. Sounds like it's in the same ballpark.

是的。聽起來像是在同一個球場。

Our next question comes from Scott Schneeberger from Oppenheimer.

我們的下一個問題來自 Oppenheimer 的 Scott Schneeberger。

For first question, I guess want to focus on regulated waste organic growth acceleration look good. How did that compare to your internal expectations? What were some of the drivers and then kind of separately as an add-on, on that theme? What are you expecting out of used paper prices? Just going forward, what are you seeing on that trend? And Janet, maybe now commentary on what percent the surcharges cover on that?

對於第一個問題，我想關注受監管的廢物有機增長加速看起來不錯。這與您的內部期望相比如何？在那個主題上，有哪些驅動因素，然後作為附加組件單獨使用？您對廢紙價格有何期待？展望未來，您對這一趨勢有何看法？珍妮特，也許現在就附加費涵蓋的百分比發表評論？

Yes. Scott, this is Cindy. I'll take the first part of your question. So I think we're pleased with RWCS. We are on track with our internal expectations. But again, I want to say if we look at Q1 of this year versus Q1 of 2022, everybody, not just Stericycle, everybody woke up to over 9% inflation. And it takes a little bit for anybody's pricing machinery to be able to implement if you're going to -- if a company is going to make any changes. It takes a little bit of time, whether it's contractual language, whether it's sitting down to figure out exactly where are the costs coming from, how are you -- what's the best strategy moving forward.

是的。斯科特，這是辛迪。我會回答你問題的第一部分。所以我認為我們對 RWCS 很滿意。我們正在按照我們的內部期望走上正軌。但我想再說一遍，如果我們看看今年第一季度與 2022 年第一季度的對比，每個人，不僅僅是 Stericycle，每個人都意識到超過 9% 的通貨膨脹。如果你要——如果一家公司要做出任何改變，任何人的定價機制都需要一點時間才能實施。這需要一點時間，無論是合同語言，還是坐下來弄清楚成本的確切來源，你好嗎——什麼是最好的前進戰略。

So our year-over-year, Q1 versus Q1 comparison is certainly skewed heavily towards price on both the shred and the RWCS side. However, we built that in for this year. Our plan is -- we plan on delivering which is why we reiterated our guidance in terms of what we're going to grow on 3% to 5% write down through with adjusted EPS, free cash flow, et cetera.

因此，我們與去年同期相比，第一季度與第一季度的比較肯定嚴重偏向切碎和 RWCS 方面的價格。但是，我們為今年構建了它。我們的計劃是——我們計劃交付，這就是為什麼我們重申我們的指導，即我們將通過調整後的每股收益、自由現金流等減記 3% 至 5% 的增長。

So I think overall for us, it was a good execution quarter for us in terms of not looking at it compared to a weaker comparison, but looking at it internally, we're pleased -- we believe we've made some solid progress on good key priorities and certainly driving towards making this year's goals.

所以我認為總體而言，對我們來說，這是一個很好的執行季度，因為與較弱的比較相比，我們不看它，但在內部看它，我們很高興——我們相信我們已經取得了一些穩固的進展好的關鍵優先事項，當然會推動實現今年的目標。

Yes. And in terms of the coverage of the paper surcharge and where we see paper rates go and I'll start with the paper rate. So we updated our footnote in the guidance, to say, we looked at the recent paper trends as we look forward. And we still kept our guidance range as the same, which means that we're able to manage that. And the reason we're able to manage what we're seeing is a recent decline from our original SOP paper rate is the ability of the surcharge to cover at least 50% of that on a revenue basis as it goes down. And when that shows up on the service revenue versus the paper revenue, whereas where price shows up.

是的。就紙張附加費的覆蓋範圍以及我們看到的紙張費率而言，我將從紙張費率開始。因此，我們更新了指南中的腳註，也就是說，我們在展望未來時研究了最近的紙張趨勢。而且我們仍然保持我們的指導範圍不變，這意味著我們能夠管理它。我們能夠管理我們所看到的情況的原因是我們最初的 SOP 紙張費率最近有所下降，因為附加費能夠在收入下降時覆蓋至少 50% 的附加費。當它出現在服務收入與賬面收入上時，而價格出現的地方。

Yes. And I think, Scott, one of the other things, I'm not quite sure if this was also what you were asking. It still works out to be about 90% -- let's say, 90% is a service fee-based revenue stream and about 10% is from the RISI rate from the surcharge -- from the RISI rate itself.

是的。我想，Scott，還有一件事，我不太確定這是否也是你要問的。結果仍然約為 90%——比方說，90% 是基於服務費的收入流，約 10% 來自附加費的 RISI 率——來自 RISI 率本身。

And times the volume of the paper.

並乘以紙張的體積。

Okay. I want to touch briefly on the divestitures and just kind of inorganic profile. So Brazil being the last in Latin America, just curious commentary, what should we expect on divestitures going forward? What inning are you in? What would be left there? Any consideration on acquisitions at this juncture of tucking anything in. I realize you have a lot going on going into the summer, but just touch on the inorganic side.

好的。我想簡要談談資產剝離和無機概況。所以巴西是拉丁美洲的最後一個，只是好奇的評論，我們對未來的資產剝離有何期待？你在第幾局？那裡會留下什麼？在這個時候考慮收購任何東西。我知道你有很多事情要進入夏天，但只涉及無機方面。

Yes. Scott, great question. I think for us obviously, we've said core is the Shred business as well as RWCS. We continue to look at all the markets and take a real good market analysis as to where is our opportunity not just to grow but to grow profitably in terms of our expectations for us to really drive the company forward to hit the long-range plans. You're right. We've had 13 divestitures since 2019. However, we've also had one acquisition. That's why we changed portfolio. We changed it. It originally come out as a portfolio rationalization, and we started the engine of divestitures. But then we morphed it to optimization because we realize that a couple of things had to happen and it started with we had to get a stronger balance sheet.

是的。斯科特，好問題。我認為對我們來說顯然，我們已經說過核心是 Shred 業務和 RWCS。我們繼續關注所有市場，並根據我們對我們真正推動公司實現長期計劃的期望，對我們的機會進行真正良好的市場分析，不僅是增長，而且是盈利增長。你說得對。自 2019 年以來，我們進行了 13 次資產剝離。但是，我們也進行了一次收購。這就是我們改變投資組合的原因。我們改變了它。它最初是作為投資組合合理化而出現的，我們啟動了資產剝離的引擎。但後來我們將其轉變為優化，因為我們意識到必鬚髮生一些事情，並且首先我們必須獲得更強大的資產負債表。

Once you get a stronger balance sheet, one you get more control of the financing, you have greater flexibility. So for us, we continue to evaluate all of our opportunities. I think we've showed a pretty strong track record in terms of certainly the divestitures, but even the acquisition, which has been contributing nicely. So for us, I think we continue to have portfolio optimization as one of our 5 key business priorities for a reason. So to your point, we are looking and evaluating everything.

一旦你獲得了更強大的資產負債表，你就可以更好地控制融資，你就會有更大的靈活性。所以對我們來說，我們會繼續評估我們所有的機會。我認為我們在資產剝離方面表現出了相當不錯的記錄，但即使是收購也做出了很好的貢獻。所以對我們來說，我認為我們繼續將投資組合優化作為我們的 5 個關鍵業務優先事項之一是有原因的。所以就你的觀點而言，我們正在尋找和評估一切。

You did bring up one very good point though, Scott, that I think is important to note. As we come into Q2, we are looking to deploy the larger portion of our business on ERP for the second half of this year, which means starting in Q2 as you start training, as we start getting into that rhythm before you flip a switch, many of our people who already are doing great things, working very hard, they will now start to take on 2 jobs. If I look at the engineering department, if I look at a lot of the operators, if I look at a lot of the -- our IT folks, those folks have a great job right now, and they're working very hard. But that ERP deployment means Q2, they start to take additional responsibilities. And we start to borrow from Peter to pay Paul in terms of applying resources to the immediate at hand. So for us, whether it's acquisitions or divestitures, like you said, the group will be quite busy as we continue to move through the year.

不過，斯科特，你確實提出了一個非常好的觀點，我認為這一點很重要。當我們進入第二季度時，我們希望在今年下半年將我們的大部分業務部署在 ERP 上，這意味著從第二季度開始培訓，因為我們在您按下開關之前開始進入那種節奏，我們的許多人已經在做偉大的事情，工作非常努力，他們現在將開始從事兩份工作。如果我看一下工程部門，如果我看很多操作員，如果我看很多 - 我們的 IT 人員，這些人現在做得很好，而且他們工作非常努力。但是 ERP 部署意味著第二季度，他們開始承擔額外的責任。我們開始向 Peter 借錢來支付 Paul 將資源用於手頭的工作。所以對我們來說，無論是收購還是資產剝離，就像你說的那樣，隨著我們繼續度過這一年，集團將非常忙碌。

Thanks. Appreciate it. Great job on getting that leverage down to -- congrats on that.

謝謝。欣賞它。將槓桿降低到 - 恭喜。

Scott, we appreciate that.

斯科特，我們對此表示讚賞。

Our next question comes from Scott Levin from Berenberg Intelligence.

我們的下一個問題來自 Berenberg Intelligence 的 Scott Levin。

So I wanted to drill down on the pricing just a little bit more. I don't know if you can estimate for us how much of this is sticky versus temporary pricing that you think might have to be adjusted downward if we see inflation abate in a meaningful way over the next few quarters?

所以我想更深入地了解定價。我不知道你是否可以為我們估計，如果我們看到未來幾個季度通貨膨脹以有意義的方式減弱，你認為可能需要向下調整的臨時定價有多少是粘性的？

Yes. Scott, that's a very good question, and we have been -- certainly, any time you put price increases into the market, whether it's in your base rates or whether you're looking at it in terms of surcharges and fees, you always have to look forward. You have to be able to say, hey, what's happening in the market? Where are we -- what's happened to customers?

是的。斯科特，這是一個很好的問題，我們一直 - 當然，任何時候你將價格上漲推向市場，無論是在你的基本費率還是你是否在考慮附加費和費用，你總是有期待。你必須能夠說，嘿，市場上發生了什麼？我們在哪裡——客戶發生了什麼事？

So for us, as we come into this year, what we're starting to do and what many companies do is you start to take a look at where is your base rate and figure out what's the adjustment that needs to be made with the base rate so that you're not necessarily just looking at surcharges and fees. You've got to be reasonable enough in there that you have flexibility throughout the year based off of what the market gives you to your point, hey, what's sticky and what isn't. I think as we continue to win new business and we look at growing the volume portion of the business that is in new sites. Remember, we measure volume in terms of actual, whether it's a ton of paper or a pound of waste. We also measure volume in terms of are we winning new customers? What is the volume of new customers we're bringing into the fold.

所以對我們來說，進入今年以來，我們開始做的和許多公司所做的是，你開始看看你的基本利率在哪裡，並弄清楚需要對基本利率進行哪些調整費率，這樣您就不必只查看附加費和費用。你必須足夠合理，根據市場給你的觀點，你全年都有靈活性，嘿，什麼是粘性的，什麼不是。我認為隨著我們繼續贏得新業務，我們著眼於增加新站點中的業務量部分。請記住，我們根據實際量來衡量體積，無論是一噸紙還是一磅垃圾。我們還根據是否贏得新客戶來衡量數量？我們帶來了多少新客戶？

So for us, we're starting a -- you've got to have a complex strategy that also helps combine what you're looking at and what you're selling at in terms of your base rates so that you can start to see what will the market bear moving forward outside of something that's based on whether it's the paper price or it's based on a fuel index or it's based on inflation. So I think key points for you to bring up, and I can tell you right now, while I can't give you the exact science to it, I can tell you it's something that we are looking at every day.

因此，對於我們來說，我們正在開始 - 你必須有一個複雜的策略，它還有助於結合你正在尋找的東西和你在基本費率方面的銷售，這樣你就可以開始看到除了基於紙價、基於燃料指數或基於通貨膨脹的東西之外，市場將承受什麼向前發展。所以我認為你要提出的關鍵點，我現在可以告訴你，雖然我不能給你確切的科學，但我可以告訴你這是我們每天都在關注的事情。

And I'd just add for -- in the secure information destruction surcharges, we have 2 that are fuel and the 1 that was paper that I mentioned early. Those flex with commodity prices, but we can keep tuning those based on -- and we keep penetrating the market based on those as well.

我只想添加 - 在安全信息銷毀附加費中，我們有 2 個是燃料，1 個是我之前提到的紙張。這些隨著商品價格的變化而變化，但我們可以根據這些價格不斷調整——我們也繼續根據這些價格滲透市場。

Great. And I know you guys don't really focus on breaking down like the smaller customer side versus larger customer side as much. But I was wondering if you can say whether there's any meaningful difference in trends you're seeing between either of those categories of customers is my sense was that the hospital side was where maybe you were seeing more pressure, maybe that's improving a little bit more. But any more color you can provide regarding that customer segmentation would be.

偉大的。而且我知道你們並沒有真正專注於像較小的客戶方與較大的客戶方那樣進行分解。但我想知道你是否可以說你在這兩類客戶之間看到的趨勢是否有任何有意義的差異，我的感覺是醫院方面可能你看到的壓力更大，也許正在改善更多.但是您可以提供關於客戶細分的任何更多顏色。

That's pretty insightful, Scott, in terms of how we look at things. We're looking at hospital accounts. So they're really big hospitals, the IDNs, the big networks. We are looking at national accounts the ones the doctors, the dentists, those type of offices that we see certainly in downtown. But then also in the rural parts. So I think what we are seeing is not all things, and I said this earlier, not all regions and not all areas of the country are equal. We're seeing some areas where some of the hospitals have shut down, some of their satellites, if you will. And I want to say kind of getting smaller and stronger.

就我們看待事物的方式而言，這很有見地，斯科特。我們正在查看醫院賬戶。所以他們真的是大醫院、IDN、大網絡。我們正在研究國民賬戶，包括醫生、牙醫，以及我們在市中心肯定看到的那些類型的辦公室。但在農村地區也是如此。所以我覺得我們看到的不是所有的東西，我剛才也說過，不是所有的地區，不是全國的所有地區都是平等的。我們看到一些地區的一些醫院已經關閉，如果你願意的話，他們的一些衛星。我想說的是變小變強。

We are seeing some similar things with some of the independents. However, in terms of what are we winning and at what price are we winning. We're very pleased with the commercial organization and the rhythm that they have going right now really driving more metrics into the business, really driving more information that we're getting from the market based on the technology that we currently have and really making some better strategic regional decisions in terms of pricing for us to be able to win profitably.

我們在一些獨立人士身上看到了一些類似的事情。然而，就我們贏得了什麼以及我們以什麼代價贏得勝利而言。我們對商業組織和他們現在的節奏感到非常滿意，他們現在確實推動了更多的業務指標，真正推動了我們根據我們目前擁有的技術從市場上獲得的更多信息，並真正做出了一些在定價方面做出更好的戰略性區域決策，使我們能夠贏利。

So I think we are maturing that process right now. And I would say, we're winning across the board in those 3 segments, specifically in RWCS, and I think that's attributable to really the maturity of the quality of revenue rhythm that we have going over these last few years.

所以我認為我們現在正在完善這個過程。我想說的是，我們在這 3 個細分市場中全面獲勝，特別是在 RWCS 中，我認為這實際上歸因於我們在過去幾年中所經歷的收入節奏質量的成熟。

Understood. One last one, if I can sneak it in. On the -- so the leveraging -- I don't remember if you had a target where you expected leverage to hit by the end of the year, anything along those lines, but obviously, the leverage has come down meaningfully. Just wondering if they're -- on the capital return side, I'm guessing there's nothing to think about for this year maybe, but for next year. Is there any elaboration you can provide whether your thoughts on the capital program and whether capital returns may be in the offering for 2024, if not second half of this year.

明白了。最後一個，如果我能偷偷說的話。關於 - 所以槓桿 - 我不記得你是否有一個目標，你預計槓桿率會在今年年底達到，任何類似的東西，但顯然，槓桿率已經顯著下降。只是想知道他們是否 - 在資本回報方面，我猜今年可能沒有什麼可考慮的，但明年。您是否可以詳細說明您對資本計劃的看法以及資本回報是否可能在 2024 年（如果不是今年下半年）的發售中。

Yes, thanks for the question. So we were pleased with the 3.05. We did have a target to achieve 3x by the first half of the year with a chance of it in the first quarter then we came awfully close. So that was our target. So by the -- we still anticipate getting to that 3 or below by the second quarter of this year. After that, we're going to be focused on investing in ourselves through the rest of the year in the ERP deployment. We are -- so the free cash flow generation that we have will continue to be used to pay down debt or our capital program internally.

是的，謝謝你的提問。所以我們對 3.05 很滿意。我們確實有一個目標，即在今年上半年實現 3 倍的增長，並有可能在第一季度實現，然後我們就非常接近了。這就是我們的目標。所以到 - 我們仍然預計到今年第二季度達到 3 或以下。在那之後，我們將在今年餘下的時間裡專注於在 ERP 部署中對自己進行投資。我們是 - 因此我們擁有的自由現金流量將繼續用於償還債務或我們內部的資本計劃。

As we get to 2024, we may have opportunities for other use of capital. As you mentioned, we haven't really refined that to a discrete menu, however, what would be on the menu, so as Cindy said, we've changed portfolio rationalization to portfolio optimization. So there's potentially opportunity for tuck-in acquisitions. And then, yes, you have the rest of the menu of options. And as we mature on that and get through this with our head down on delivering what we said we're going to deliver, those are options we'll have in the future to explore.

到 2024 年，我們可能會有機會將資金用於其他用途。正如你提到的，我們還沒有真正將其細化為一個獨立的菜單，但是，菜單上會有什麼，正如辛迪所說，我們已經將投資組合合理化改為投資組合優化。因此，存在潛在的收購機會。然後，是的，您有其餘的選項菜單。隨著我們在這方面的成熟並通過我們的努力來實現我們所說的我們將要交付的東西，這些都是我們未來可以探索的選擇。

Our next question comes from Tobey Sommer from Truist Securities.

我們的下一個問題來自 Truist Securities 的 Tobey Sommer。

This is Jack Wilson on for Tobey. In terms of the 3% to 5% organic revenue guidance for 2023, how should we be thinking about the growth cadence for the remainder of the year with the Q1 growth and the return of electric surgeries built in?

這是托比的傑克·威爾遜。就 2023 年 3% 至 5% 的有機收入指導而言，隨著第一季度的增長和電手術的回歸，我們應該如何考慮今年剩餘時間的增長節奏？

Yes. I think, Jack, welcome. It's nice to have you. We're looking forward to engaging with Tobey. But just I think a couple of things that we have to really temper and take a look at. We've got a major deployment for a technology system. Our ERP portion going in for RWCS in the second half of this year. So we've built a lot of things into this year's plan, but we believe that all things aren't equal, remember this quarter shows really big numbers in terms of revenue growth. But it's compared to probably one of the most difficult quarters, I think we may have faced in Q1 of 2022.

是的。我想，傑克，歡迎。很高興有你。我們期待與 Tobey 合作。但我認為有幾件事我們必須真正地鍛煉和審視。我們已經對技術系統進行了重大部署。我們的 ERP 部分將在今年下半年用於 RWCS。所以我們在今年的計劃中加入了很多東西，但我們相信並非所有事情都是平等的，請記住本季度在收入增長方面顯示出非常大的數字。但與可能是最困難的季度之一相比，我認為我們可能在 2022 年第一季度遇到過。

So I think what's more important is what are we looking at for 2023. We see positive signs in terms of hospitals getting their, shoring up their staffing. We see positive signs in terms of people starting to go back for elective surgeries, remembering that it isn't the same for every hospital. It isn't as if a switch slip and now everybody is back. So -- but as the hospitals recover, we are well positioned to take advantage of that, knowing that as soon as we get into the second half of this year, really with the preparation in Q2 and then deployment in Q3, we've got a few other things that are going to be going on. While we continue to service the customers that we have. So a lot to the balance here. But I think a 3% to 5% growth in terms of the target is a good number for us to drive towards.

因此，我認為更重要的是我們對 2023 年的展望。我們在醫院獲得、加強人員配置方面看到了積極跡象。我們看到人們開始回去接受擇期手術方面的積極跡象，請記住每家醫院的情況都不一樣。這不像是開關滑動，現在每個人都回來了。所以——但是隨著醫院的恢復，我們已經準備好利用這一點，因為我們知道一旦進入今年下半年，真正在第二季度進行準備，然後在第三季度進行部署，我們就有了其他一些將要發生的事情。在我們繼續為現有客戶提供服務的同時。這裡的平衡很多。但我認為，就目標而言，3% 至 5% 的增長對我們來說是一個很好的數字。

That makes a lot of sense. Just maybe one on sort of the new facilities coming online in New Jersey and Nevada. How should we be thinking about the regulatory environment in terms of getting these facilities sort of completed and online?

這很有意義。也許只是新澤西州和內華達州即將上線的一些新設施。我們應該如何考慮讓這些設施完成並上線的監管環境？

That's again. I think anytime anybody talks about regulatory and trying something past -- there is complexity there. But the good news for Stericycle is this is where we live. This is the arenas in which we live providing a very vital service to communities where all of our facilities and where we do our work.

又是這樣我認為任何時候任何人都在談論監管和嘗試過去的事情——那裡很複雜。但對 Stericycle 來說，好消息是這就是我們生活的地方。這是我們生活的場所，為我們所有設施和工作所在的社區提供非常重要的服務。

So for us, we're very pleased with the progress, specifically, if I could just mention McCarran. Just as McCarran, Nevada is going to be about 100,000 square foot facility. We're going to have 2 incinerators there. It's one of those where it is a waste energy plant. We're going to recycle all the water that's used to process the waste. So it will be a 0 process water discharge. It expected to be the cleanest mid-waste incinerator. And I think it's exciting for us to see things advance. And we've got a very strong public relations and public affairs team that right now are certainly working our operators to make sure that we're -- it's important not just to have a facility. You've got to make sure that you've got all the permitting, and we are well on our way to have that happen. So that we can have McCarran open some time in first half of next year.

所以對我們來說，我們對取得的進展感到非常滿意，特別是如果我能提到麥卡倫的話。與 McCarran 一樣，內華達州也將擁有約 100,000 平方英尺的設施。我們將在那里安裝 2 個焚化爐。它是其中一個廢棄能源工廠。我們將回收所有用於處理廢物的水。所以這將是一個 0 過程水排放。它有望成為最乾淨的中等廢物焚化爐。我認為看到事情取得進展對我們來說是令人興奮的。我們有一個非常強大的公共關係和公共事務團隊，現在肯定正在與我們的運營商合作，以確保我們——重要的不僅僅是擁有一個設施。您必須確保獲得所有許可，我們正在努力實現這一目標。這樣我們就可以讓麥卡倫在明年上半年的某個時候開業。

Our next question comes from Kevin Steinke from Barrington Research.

我們的下一個問題來自 Barrington Research 的 Kevin Steinke。

In terms of secure information destruction, you're about, I guess, 18 months out from the ERP deployment in that business. And just wondering what you're seeing in terms of your ability to drive new customer growth in that business. Maybe be based on insights you're gaining from the ERP. And just how also our returned office trends playing into the volume outlook and potential new customer growth.

就安全信息銷毀而言，我猜你在該企業部署 ERP 後大約需要 18 個月。只是想知道您在推動該業務的新客戶增長方面的能力。也許基於您從 ERP 中獲得的洞察力。以及我們返回辦公室的趨勢如何影響銷量前景和潛在的新客戶增長。

Kevin, that's a really good question with reference to the 18 months. So one of the things that I think we are very -- we're happy about. Any time people come back to the office, that's a good sign. I also have noticed, and I'm sure many of you have too that for everybody that's coming back to work, there is another company that's announcing some pretty big layoffs. So it isn't as if the world is looking anything 2019 yet. However, I think any time, as I said, folks come back that's great. The question was where are we in the -- with the ERP deployment. And here's what I think I'm most proud of.

凱文，關於 18 個月，這是一個非常好的問題。因此，我認為我們非常高興的一件事。任何時候人們回到辦公室，都是一個好兆頭。我也注意到，而且我相信你們中的許多人也注意到，對於每個重返工作崗位的人來說，還有另一家公司宣布了一些相當大的裁員。因此，似乎世界還沒有看到 2019 年的任何東西。但是，我認為任何時候，正如我所說，人們回來真是太好了。問題是我們在 ERP 部署方面處於什麼位置。這就是我認為我最引以為豪的事情。

In that 18 months, we've gone from, hey, everybody, here's an issue, here's a bug in the system, let's fix it to now we are with the technology, we're now looking at all the enhancements that we can make, which is really that where you want to be in that kind of crawl, walk, run scenario. You start off fixing what bugs are in the system and then you figure out okay, this is running, you get it running smoothly. Everybody becomes comfortable with it. You start to understand data and then you see, all right, with this data.

在那 18 個月裡，我們已經從，嘿，大家，這是一個問題，這是系統中的一個錯誤，讓我們修復它，現在我們有了技術，我們現在正在研究我們可以做出的所有增強，這就是你想要在那種爬行、行走、奔跑場景中所處的位置。你開始修復系統中的錯誤，然後你發現沒問題，它正在運行，你讓它運行順利。每個人都會適應它。你開始理解數據，然後你就可以看到這些數據。

If I had this enhancement, I would get that much more granular and I'd be able to fix something, further upstream than what I can see right now. And I think we have moved from the fixing things into the enhancing things, really starting to leverage data. We're looking at everything from route rebalancing, certainly on the operations side. But then I think the other question you asked is, we are also now leveraging a good bit of that technology to improve the commercial rhythm, the sales rhythm.

如果我有這個增強功能，我會得到更細化的東西，並且我能夠修復一些東西，比我現在看到的更上游。而且我認為我們已經從修復事物轉向增強事物，真正開始利用數據。我們正在研究路線重新平衡的一切，當然是在運營方面。但我想你問的另一個問題是，我們現在也在充分利用這種技術來改善商業節奏，銷售節奏。

One of the things that you would have noticed is on quality of revenue, we talked about improving customer implementation velocity. Well, that really means from the time as an example in Shred, somebody signs up a customer. How quickly can I get out there to make that first service. When you're very manual, that can be very cumbersome and very labor intense. Right now in technology, that is affording us the opportunity to reduce that or speed up, I should say, to improve the velocity from the time of sale to the time where we're actually servicing a customer. So I think leveraging that ERP, we are hitting on the cylinders that we had outlined. And I still think that there's some runway for us to continue to improve.

您會注意到的一件事是收入質量，我們談到了提高客戶實施速度。好吧，這真的意味著，從 Shred 的例子來看，有人註冊了一個客戶。我能多快到那裡做第一個服務。當您非常手動時，這可能會非常麻煩並且非常費力。現在在技術方面，這為我們提供了減少或加快速度的機會，我應該說，以提高從銷售時間到我們實際為客戶提供服務的速度。因此，我認為利用該 ERP，我們正在實現我們所概述的圓柱體。而且我仍然認為我們有一些跑道可以繼續改進。

Our next question comes from Brian Butler from Stifel.

我們的下一個問題來自 Stifel 的 Brian Butler。

Just on the first one. I know margins aren't really broken out between the 2 segments. But when you think about in the improvement that you saw in the first quarter, any color we can see on how regulated medical waste or the SID kind of our trend? Are they moving apart? Or are they still kind of very close.

就在第一個。我知道這兩個部分之間的利潤率並沒有真正分開。但是，當您考慮在第一季度看到的改進時，我們可以看到關於如何監管醫療廢物或我們趨勢的 SID 類型的任何顏色？他們要分開了嗎？或者他們仍然很親密。

Yes. So both are in the same range of margins, and they both are staying aligned in that range. So both are good margin businesses, and that's why we consider them core. And you're not seeing a divergence there. The difference is, it is a little bit more on cash because it is a lighter cash investment model than RWCS as we modernize it. So cash is -- both generate cash instead it's a nice contributor for our investment thesis that we're doing across both of our core businesses.

是的。所以兩者都在相同的邊距範圍內，並且它們都在該範圍內保持一致。所以兩者都是良好的利潤率業務，這就是為什麼我們認為它們是核心業務。你在那裡沒有看到分歧。不同之處在於，它更多地使用現金，因為在我們對其進行現代化改造時，它是一種比 RWCS 更輕的現金投資模型。所以現金是 - 兩者都會產生現金，而不是我們在兩個核心業務中所做的投資論文的一個很好的貢獻者。

And then you talked about electrosurgery kind of improving in the back half and that was kind of built in. Do you have any color on the maritime activity and where that stands and how that fits into the guidance for '23?

然後你談到了電外科在後半部分有所改善，這是內置的。你對海上活動有什麼看法嗎？它的立場以及它如何融入'23 的指導？

Yes. I think we're seeing -- any time that customers are coming back and taking cruises, it's good news for us. So I believe that -- and remember, sometimes that revenue has a hint of seasonality to it. But I think where we are internally with reference to maritime, we're very pleased in terms of the growth, in terms of the amount of crew ships that are out and running and our ability to continue to process it. So at maritime, it's good news story.

是的。我認為我們正在看到——任何時候客戶回來乘坐遊輪，這對我們來說都是好消息。所以我相信 - 請記住，有時收入會帶有一絲季節性。但我認為我們在內部關於海事的地方，我們對增長、出海和運行的船員數量以及我們繼續處理它的能力感到非常高興。所以在海事方面，這是個好消息。

Okay. And then maybe my last one follow-up. I know you talked about the optimization of the portfolio, but I just wanted to make sure I understood. Is there anything really left outstanding any -- I mean, obviously, we're looking at all the time what fits best. But is there any big items that remain or really you pared down now to what you see as kind of the core?

好的。然後也許是我的最後一個跟進。我知道你談到了投資組合的優化，但我只是想確保我理解了。是否真的有什麼懸而未決的——我的意思是，很明顯，我們一直在尋找最合適的東西。但是，是否有任何大項目保留下來，或者您現在是否真的削減了您認為是核心的項目？

Brian, good question. But unfortunately, not one that I'm going to be able to answer in terms of giving you specifics. This is the last thing that Stericycle would ever want to do would be to put out there something that is potentially that we're looking at on either an acquisition or a divestiture certainly prematurely. So for us, we just continue to look at the market. We continue to drive the accretive revenue. We continue to drive the commercial organization as well as the operations portion to work as efficiently and as they possibly can. So within those parameters, we've got a pretty good track record, and I think we're going to continue down that path. So apologies that I can't tell you anything more than that. But quite frankly, we've never really done that.

布賴恩，好問題。但不幸的是，我無法為您提供具體細節。這是 Stericycle 最不想做的事情，那就是放出一些我們可能過早地考慮收購或資產剝離的東西。所以對我們來說，我們只是繼續看市場。我們繼續推動增加收入。我們繼續推動商業組織和運營部門盡可能高效地工作。所以在這些參數範圍內，我們有一個很好的記錄，我認為我們將繼續沿著這條路走下去。很抱歉我不能告訴你更多。但坦率地說，我們從未真正做到過。

Our next question comes from Michael Hoffman from Stifel.

我們的下一個問題來自 Stifel 的 Michael Hoffman。

Yes. I apologize to double tune. We have 5 calls this morning, so we're overlapping. Following on Brian's question, I guess, you're not done. It's a fair answer, though. There's more to do. You won't tell us what it is. That's fine, but there's a little bit more to do.

是的。我向雙調道歉。今天早上我們有 5 個電話，所以我們是重疊的。在 Brian 的問題之後，我想，你還沒有完成。不過，這是一個公平的答案。還有更多事情要做。你不會告訴我們它是什麼。這很好，但還有更多工作要做。

I'd say it remains a key business priorities, Michael, so I appreciate you highlighting that. And good morning, by the way.

我想說這仍然是一個關鍵的業務優先事項，邁克爾，所以我很感謝你強調這一點。順便說一句，早上好。

I'm drinking quarterly earnings out of a firehose this morning...

今天早上我正在用消防水管喝季度收益...

As a matter of fact, when I heard Brian come on, I think that's where you work. So we appreciate you taking time to catch up with us.

事實上，當我聽到 Brian 出現時，我認為那是你工作的地方。因此，我們感謝您抽出時間與我們聯繫。

The other question, Nevada is going to come online next spring, but you've been moving waste around the country because to your credit, you closed Utah to manage the community relations. The volume had to move. What's that incremental cost for moving that? As I'm assuming you're bearing it?

另一個問題是，內華達州將於明年春天上線，但您一直在全國范圍內運送垃圾，因為值得讚揚的是，您關閉了猶他州以管理社區關係。音量必須移動。移動它的增量成本是多少？正如我假設你正在承受它？

Yes. Well, I'll tell you, while we won't give the specifics in terms of the cost, I can describe it for you. Number one, the facilities that are all around, all on the West Coast are right now overburdened. So that's taxing equipment, it taxing our people in order to be able to continue to provide the right type of service. Number two, we've got third parties involved that we really want to be out of the third-party business. We've got that with reference to whether it's disposal capabilities, incineration capabilities, long-haul capabilities. So there's an awful lot of third party, which, quite frankly, has been quite expensive as we take a look at this last -- this last year or so. Good bit of costs have been flowing through that, that have been difficult.

是的。好吧，我告訴你，雖然我們不會在成本方面給出具體細節，但我可以為你描述一下。第一，西海岸周圍所有的設施現在都已經不堪重負。所以這是對設備的徵稅，它對我們的人員徵稅，以便能夠繼續提供正確的服務類型。第二，我們有第三方參與，我們真的想退出第三方業務。我們已經參考了它的處置能力、焚燒能力、長途運輸能力。所以有很多第三方，坦率地說，當我們最後看一下這個時，第三方的成本非常高——去年左右。大量的成本一直在流經，這很困難。

And then just our own long haul. Certainly, far a more long haul runs from the West Coast to different parts of the U.S. than we would then is optimum. So when McCarran comes up and running. And remember, a facility opens, you make sure everything works, you get the rhythm of the facility and then you start to build yourself up to capacity and capability. I like where this is positioned. I really -- we're very, very excited about not just what it's going to do -- certainly, what it's going to do for us internally. But for this being the type of facility that we're building, this is really going to set the model and the standard moving forward in the industry. So that's exciting.

然後就是我們自己的長途跋涉。當然，從西海岸到美國不同地區的距離比我們當時的最佳距離要長得多。因此，當 McCarran 出現並運行時。請記住，一個設施打開，你確保一切正常，你了解設施的節奏，然後你開始建立自己的容量和能力。我喜歡它的位置。我真的 - 我們非常非常興奮，不僅僅是它會做什麼 - 當然，它會在內部為我們做什麼。但對於我們正在建設的這種設施類型，這確實會樹立行業前進的模式和標準。所以這很令人興奮。

And then all the other facilities that surround this area on the West Coast, I think they're going to get a big sigh of relief, because sometimes you can push them too hard as well where they run beyond. They're not efficient either. So we get this facility online. I think we're going to see -- I think the operators are going to be very happy. But I think most importantly, our customers are going to be happy in the fact that we're going to be able to continue to grow and try to provide them terrific service.

然後是西海岸這個地區周圍的所有其他設施，我想他們會鬆一口氣，因為有時你會把它們推得太緊，也會超出它們的範圍。他們也沒有效率。所以我們在線獲得了這個設施。我想我們會看到——我認為運營商會非常高興。但我認為最重要的是，我們的客戶將會感到高興，因為我們將能夠繼續發展並努力為他們提供出色的服務。

So just to be clear for everybody listening. In the first half of '24, a lot of that goes away, and therefore, having nothing to do with the ERPs and all that, you just open up a new facility and rebalance the operating leverage of the model for that alone.

所以只是為了讓每個聽眾都清楚。在 24 年上半年，其中很多都消失了，因此，與 ERP 和所有這些無關，您只需開設一個新設施並重新平衡模型的運營槓桿。

Yes. I think that's one of the things that we had looked at when we spoke to everybody about guidance and long-range plans and those types of things. We do have that taken into consideration in terms of opportunity. Just remember it isn't a switch flip. It all doesn't -- I think for everybody listening, it isn't a the door goes open and all of a sudden, everything goes away. We've got to work through some things. Again, it's a crawl, walk, run.

是的。我認為這是我們在與每個人談論指導和長期計劃以及那些類型的事情時所關注的事情之一。我們確實在機會方面考慮到了這一點。請記住，這不是開關。這一切都沒有——我想對於每個聽的人來說，這不是一扇門打開了，突然之間，一切都消失了。我們必須解決一些問題。同樣，它是爬行、步行、跑步。

However, the long-term outlook for us with that facility when we do get it all up and running, we do get rid of all the other contracts that we have with third party. We work on making sure that we rebalance the routes. We make sure that we've got our internal network going. That's a process. And once that's there, to your point, Michael, that's how we see our way to providing the long-term outlook that we did with some pretty good adjusted EBITDA, growth rates and some free cash flow conversion rates.

但是，從長遠來看，當我們確實啟動並運行該設施時，我們確實擺脫了與第三方簽訂的所有其他合同。我們努力確保重新平衡路線。我們確保我們的內部網絡正常運行。那是一個過程。一旦到了那裡，就你的觀點而言，邁克爾，這就是我們如何看待我們提供長期前景的方式，我們通過一些相當不錯的調整後 EBITDA、增長率和一些自由現金流轉換率來做。

This concludes our Q&A. I'll now hand back to Cindy Miller, CEO, for any final remarks.

我們的問答到此結束。現在，我將把最後的評論交還給首席執行官 Cindy Miller。

Thank you, Elliot. So to everyone listening to this call, we greatly appreciate your interest in Stericycle and your shared excitement in our future. So thank you very much.

謝謝你，埃利奧特。因此，對於所有聽到此電話的人，我們非常感謝您對 Stericycle 的興趣以及您對我們未來的共同興奮。非常感謝。

Ladies and gentlemen, today's call has now concluded. We'd like to thank you for your participation. You may now disconnect your lines.

女士們，先生們，今天的電話會議到此結束。感謝您的參與。您現在可以斷開線路。