Montrose Environmental Group Inc at JPMorgan Ultimate Services Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Vijay, can you help us understand what are the growth drivers for Montrose and maybe how they differ by segment? How much is regulatory-driven? How much is company-specific .

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : And can you touch on some of the regulatory legislation that you're keeping an eye on? Maybe you can talk about the Inflation Reduction Act, but any other kind of regulations that we should watch. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 17, 2022 / 9:15PM, MEG.N - Montrose Environmental Group Inc at JPMorgan Ultimate Services Conference

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Okay. Great. And it's nice to hear about the development with OGI because I know that is something that Montrose has been doing, but there just wasn't necessarily that regulatory push for increased adoption.

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : And how should we think about the operating leverage for Montrose? I know that you're investing in the remediation and reuse segment and maybe that's a large part of it. But as we think about high single digit or above organic revenue growth, how does that translate into operating leverage?

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Okay. And since you touched on acquisition opportunities within the assessment segment, I guess, can you highlight some of the, I guess, expertise or technology or areas that you're looking at for M&A opportunities? .

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Okay. Great. Can you talk about Montrose's go-to-market strategy? So how do you win in the marketplace? It seems like you're growing above industry growth rates? I know we're looking at a lot of diverse smaller industry segments. So can you just talk about how you go to market, how are you able to win, who are you competing with?

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : And I guess, do you really -- do you compete on price or not really, it's really your service offering and expertise that.

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : And I know there is a slight mismatch right now between the cost inflation that you've taken on and then the price increases that you put forth. I guess how much of your revenues are those fixed price contracts or maybe it's harder to push price in real time versus the time of materials where you can kind of react more quickly?

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Okay. Great. Let's talk a little bit about your PFAS-related businesses. It's seeing very strong growth. Can you -- I know you have a proprietary technology with regenerable resins. How much has that played a role in kind of the high-growth kind of.

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : And I think PFAS is now about 20% of our total company revenues. Do you anticipate maybe breaking that out for investors in the future? And also, do you think the rate of growth that you've experienced is sustainable over the next few years? .

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Yes. Yes. And I know you talked about cross-selling or increased cross-selling traction that you gained. Has that occurred in the PFAS solutions areas or .

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : And do you have any client concentrations within your PFAS customers? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 17, 2022 / 9:15PM, MEG.N - Montrose Environmental Group Inc at JPMorgan Ultimate Services Conference

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Is there a particular industry that those clients are in?

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : In terms of -- you touched a little bit on this, the company's growth algorithm. So I think in terms of what you've published, you talked about 20% full revenue growth, 100 to 150 basis points of margin expansion in a typical year. Does that still hold true? It sounds like maybe it's stepping up higher? And also, how does that break out between organic versus M&A?

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Okay. Can we talk a little bit about Montrose's renewable energy biogas business, just -- what do you do there? And what do you see as kind of the growth rate and margins for that business over the next few years?

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : And I guess in terms of target margins, would it be kind of in line with what you expect for the remediation reuse segment? Or how do you think about returns?

Question: Stephanie L. Yee - JPMorgan Chase & Co, Research Division - Analyst : Okay. Great. I think we're up on time. So let's just stop there. Thank you for being here. Appreciate the time.