On this page of StockholderLetter.com we present the latest annual shareholder letter from Quest Resource Holding Corp — ticker symbol QRHC. Reading current and past QRHC letters to shareholders can bring important insights into the investment thesis.
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continuously finding ways to add value, and they have rewarded us by
expanding our relationship with them. We are also adding new clients
to our portfolio as the word of our differentiated approach is becoming
more broadly communicated.
Dan Friedberg
Chairman of the Borad of Directors
Dear Fellow Stockholders,
I am delighted to be writing you this letter at the fifth anniversary of
my becoming Chairman of the Board and leading the recapitalization
of Quest Resource Holding Corporation. I want to express my sincere
gratitude to our stakeholders     clients, employees, and investors     for
their support and underline my enthusiasm for what lies ahead for the
Company.
Our strategy has not deviated since being put in place five years ago.
Our focus was and remains on bringing unrivaled service to our
clients, supporting the environment, creating a positive work
environment for our employees, and generating long-term returns for
our stakeholders. Growth is not linear, and execution takes time, and
because of a lot of hard work from a great team and the loyalty of a
terrific base of clients, we are making very solid progress. The results,
both in client satisfaction and financial performance, are increasingly
evident and we are excited about our prospects.
Our plan remains focused on three important paths: (1) expand with
our existing clients by supporting their waste, recycling and reporting
needs across geographies, waste streams, and service lines, (2) grow
organically by demonstrating our value-added capabilities and breadth
of our offering, and by building trust with clients, and (3) by making
acquisitions of companies where we can serve their clients better by
adding them to our platform and/or by increasing value from the
addition of adjacent or downstream services.
In executing our strategy, we have built and continue to develop a
broad set of capabilities. We have added to our organization, building
on what was already a great team. We have diversified our client base,
We have been acutely aware that, coupled with carrying out our
growth strategy, it is critical for us to improve our operating
efficiencies and enhance our ability to serve our clients, further driving
our performance. The more efficient the business, the quicker, more
accurate, and lower the cost to serve, which means our
competitiveness grows and our operating margins improve. This is a
continuous effort, and we have been investing in systems, processes,
and capabilities that will generate ongoing improvements throughout
the organization. We believe these investments in team, systems and
capabilities will enhance the client experience and will increasingly
drive operating efficiencies and profit margins.
Our momentum is very positive, our efforts are bearing results, and we
are putting in place a foundation that should enable us to continue to
grow well into the future. We see many opportunities to expand,
adding services and capabilities to existing clients and future clients
more broadly.
We are humbled by the trust that our clients, partners, and employees
place with us. We are committed to continuing our growth in a
profitable and socially responsible way, delivering on our mission of
diverting waste from landfill and generating long-term financial
returns. We are excited for the future and will continue to work to
deliver against our strategy and serve our stakeholders.
Sincerely,
Dan Friedberg
Chairman of the Borad of Directors
S. Ray Hatch
Chief Executive Officer
Dear Fellow Stockholders,
As we look at the promising and exciting year ahead, I am proud to
reflect on the financial and operational achievements of 2023 and
plans for 2024.
For 2023, we finished the year with $288 million in revenue, $50
million in gross profit and $16 million in Adjusted EBITDA. Versus
where we started our transformational journey several years ago, we
are now a dramatically larger and better-positioned company, ready to
capture the exciting opportunities for profitable growth and value
creation.
We experienced a pivotal year in 2023, completing integrations of all
previous acquisitions, as well as expanding our service lines, vendor
network, client base and end markets. We have made significant
investments in people, process and technologies to build a platform
that will accelerate growth, continuously improve efficiency and client
value, and scale to the size of a much larger enterprise. During 2023,
we have just begun to see the results of these investments in our
unique platform, which was a key deciding factor for several
competitive wins and has helped us maintain enduring client
relationships.
continued on next page...
QUEST RESOURCE HOLDING CORPORTAION | ANNUAL REPORT 2023
2
ENHANCING OUR ABILITY TO SCALE
Investments in our platform are improving the speed at which we can
operate and enabling greater efficiency and profitability. With our
enhanced scale and capabilities, we are now onboarding new clients
in a matter of weeks, a task that previously was measured in months.
The onboarding task is complicated. For our largest clients, it includes
establishing connections with thousands of lines of service, thousands
of vendors, and hundreds of client locations, as well as translating
transactional data into useful operational and sustainability reporting.
Investments in our platform are allowing us to do this faster and with
better execution. This means driving faster efficiency realization for us,
as well as faster cost savings and land fill diversion for our clients.
investment in our platform, we are further differentiating our value
proposition, which will give us ample opportunities for continued
growth from our existing clients for multiple years to come.
INCREASED DEMAND FOR SUSTAINABILITY
Our value proposition is resonating at a time when the market is
undergoing significant change. Industry secular trends are in our favor,
including increased pressure on large companies to improve
sustainability and comply with increased regulation. Increased prices
for landfill and tipping fees are also shedding more light on
companies    waste spend, enabling us to highlight cost-effective
sustainability programs with potential clients for alternative disposal
solutions for their waste streams.
ACCELERATING ORGANIC GROWTH
Investments we have made in sales and marketing are helping us
grow our pipeline and shorten the sales cycle. As a result, we
successfully garnered new clients in two new end market verticals
and the pace of organic growth has gained momentum. We are
producing record client wins and meaningfully expanding existing
client relationships at an accelerated pace. In addition to closing
several deals, in recent months, we have continued to see a
noticeable uptick in not only the number, but the size of opportunities
in our pipeline. With the success we are having with new client wins,
we plan to accelerate our investment in organic growth initiatives
during 2024.
I   m very proud of what the Quest team has accomplished over the last
several years, which is to build a platform that can scale profitably into
a much larger enterprise. Importantly, our past and future success will
also be driven by our people, and I want to sincerely thank our
employees and management team for their passion for improving
sustainability and their dedication to our clients and our company. With
fiscal    24 now underway, we look ahead with great confidence. The
work we have done has centered on building a consistent and
sustainable business focused on providing valued services to our
clients. The foundation is set for continued success and to build value
for our shareholders. We expect our momentum to carry through this
year and beyond. I couldn't be more excited about what's to come.
ENHANCING THE VALUE PROPOSITION
As a result of a multi-year successful track record and continuous
improvement in our service offering enabled by investments in our
platform, we have formed enduring and strategic client relationships
with an average engagement for our top 20 clients of 9 years. In
addition to creating loyal clients, our value has consistently resulted in
incremental business from existing client. Recently, we signed
multi-year renewals and expanded our engagement with two of our
largest clients. Our land and expand strategy has consistently
delivered solid growth from our existing client base, and with
QUEST RESOURCE HOLDING CORPORTAION | ANNUAL REPORT 2023
Sincerely,
S. Ray Hatch
Chief Executive Officer
3
 • shareholder letter icon 6/6/2024 Letter Continued (Full PDF)
 • stockholder letter icon 6/1/2023 QRHC Stockholder Letter
 • stockholder letter icon More "Waste Management" Category Stockholder Letters
 • Benford's Law Stocks icon QRHC Benford's Law Stock Score = 60


QRHC Shareholder/Stockholder Letter Transcript:

#007#. 4'2146


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48(67 2%3/52#% (/,$).' #/20/24!)/. _ !..5!, 2%0/24     


continuously finding ways to add value, and they have rewarded us by
expanding our relationship with them. We are also adding new clients
to our portfolio as the word of our differentiated approach is becoming
more broadly communicated.
Dan Friedberg
Chairman of the Borad of Directors
Dear Fellow Stockholders,
I am delighted to be writing you this letter at the fifth anniversary of
my becoming Chairman of the Board and leading the recapitalization
of Quest Resource Holding Corporation. I want to express my sincere
gratitude to our stakeholders     clients, employees, and investors     for
their support and underline my enthusiasm for what lies ahead for the
Company.
Our strategy has not deviated since being put in place five years ago.
Our focus was and remains on bringing unrivaled service to our
clients, supporting the environment, creating a positive work
environment for our employees, and generating long-term returns for
our stakeholders. Growth is not linear, and execution takes time, and
because of a lot of hard work from a great team and the loyalty of a
terrific base of clients, we are making very solid progress. The results,
both in client satisfaction and financial performance, are increasingly
evident and we are excited about our prospects.
Our plan remains focused on three important paths: (1) expand with
our existing clients by supporting their waste, recycling and reporting
needs across geographies, waste streams, and service lines, (2) grow
organically by demonstrating our value-added capabilities and breadth
of our offering, and by building trust with clients, and (3) by making
acquisitions of companies where we can serve their clients better by
adding them to our platform and/or by increasing value from the
addition of adjacent or downstream services.
In executing our strategy, we have built and continue to develop a
broad set of capabilities. We have added to our organization, building
on what was already a great team. We have diversified our client base,
We have been acutely aware that, coupled with carrying out our
growth strategy, it is critical for us to improve our operating
efficiencies and enhance our ability to serve our clients, further driving
our performance. The more efficient the business, the quicker, more
accurate, and lower the cost to serve, which means our
competitiveness grows and our operating margins improve. This is a
continuous effort, and we have been investing in systems, processes,
and capabilities that will generate ongoing improvements throughout
the organization. We believe these investments in team, systems and
capabilities will enhance the client experience and will increasingly
drive operating efficiencies and profit margins.
Our momentum is very positive, our efforts are bearing results, and we
are putting in place a foundation that should enable us to continue to
grow well into the future. We see many opportunities to expand,
adding services and capabilities to existing clients and future clients
more broadly.
We are humbled by the trust that our clients, partners, and employees
place with us. We are committed to continuing our growth in a
profitable and socially responsible way, delivering on our mission of
diverting waste from landfill and generating long-term financial
returns. We are excited for the future and will continue to work to
deliver against our strategy and serve our stakeholders.
Sincerely,
Dan Friedberg
Chairman of the Borad of Directors
S. Ray Hatch
Chief Executive Officer
Dear Fellow Stockholders,
As we look at the promising and exciting year ahead, I am proud to
reflect on the financial and operational achievements of 2023 and
plans for 2024.
For 2023, we finished the year with $288 million in revenue, $50
million in gross profit and $16 million in Adjusted EBITDA. Versus
where we started our transformational journey several years ago, we
are now a dramatically larger and better-positioned company, ready to
capture the exciting opportunities for profitable growth and value
creation.
We experienced a pivotal year in 2023, completing integrations of all
previous acquisitions, as well as expanding our service lines, vendor
network, client base and end markets. We have made significant
investments in people, process and technologies to build a platform
that will accelerate growth, continuously improve efficiency and client
value, and scale to the size of a much larger enterprise. During 2023,
we have just begun to see the results of these investments in our
unique platform, which was a key deciding factor for several
competitive wins and has helped us maintain enduring client
relationships.
continued on next page...
QUEST RESOURCE HOLDING CORPORTAION | ANNUAL REPORT 2023
2

ENHANCING OUR ABILITY TO SCALE
Investments in our platform are improving the speed at which we can
operate and enabling greater efficiency and profitability. With our
enhanced scale and capabilities, we are now onboarding new clients
in a matter of weeks, a task that previously was measured in months.
The onboarding task is complicated. For our largest clients, it includes
establishing connections with thousands of lines of service, thousands
of vendors, and hundreds of client locations, as well as translating
transactional data into useful operational and sustainability reporting.
Investments in our platform are allowing us to do this faster and with
better execution. This means driving faster efficiency realization for us,
as well as faster cost savings and land fill diversion for our clients.
investment in our platform, we are further differentiating our value
proposition, which will give us ample opportunities for continued
growth from our existing clients for multiple years to come.
INCREASED DEMAND FOR SUSTAINABILITY
Our value proposition is resonating at a time when the market is
undergoing significant change. Industry secular trends are in our favor,
including increased pressure on large companies to improve
sustainability and comply with increased regulation. Increased prices
for landfill and tipping fees are also shedding more light on
companies    waste spend, enabling us to highlight cost-effective
sustainability programs with potential clients for alternative disposal
solutions for their waste streams.
ACCELERATING ORGANIC GROWTH
Investments we have made in sales and marketing are helping us
grow our pipeline and shorten the sales cycle. As a result, we
successfully garnered new clients in two new end market verticals
and the pace of organic growth has gained momentum. We are
producing record client wins and meaningfully expanding existing
client relationships at an accelerated pace. In addition to closing
several deals, in recent months, we have continued to see a
noticeable uptick in not only the number, but the size of opportunities
in our pipeline. With the success we are having with new client wins,
we plan to accelerate our investment in organic growth initiatives
during 2024.
I   m very proud of what the Quest team has accomplished over the last
several years, which is to build a platform that can scale profitably into
a much larger enterprise. Importantly, our past and future success will
also be driven by our people, and I want to sincerely thank our
employees and management team for their passion for improving
sustainability and their dedication to our clients and our company. With
fiscal    24 now underway, we look ahead with great confidence. The
work we have done has centered on building a consistent and
sustainable business focused on providing valued services to our
clients. The foundation is set for continued success and to build value
for our shareholders. We expect our momentum to carry through this
year and beyond. I couldn't be more excited about what's to come.
ENHANCING THE VALUE PROPOSITION
As a result of a multi-year successful track record and continuous
improvement in our service offering enabled by investments in our
platform, we have formed enduring and strategic client relationships
with an average engagement for our top 20 clients of 9 years. In
addition to creating loyal clients, our value has consistently resulted in
incremental business from existing client. Recently, we signed
multi-year renewals and expanded our engagement with two of our
largest clients. Our land and expand strategy has consistently
delivered solid growth from our existing client base, and with
QUEST RESOURCE HOLDING CORPORTAION | ANNUAL REPORT 2023
Sincerely,
S. Ray Hatch
Chief Executive Officer
3



shareholder letter icon 6/6/2024 Letter Continued (Full PDF)
 

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