US re-refiner and lube blender Safety-Kleen Sustainability Solutions (SKSS) saw profit surge in the second quarter to a record high on the back of strong demand and higher prices.

Profit before interest, taxes, depreciation, and amortization (EBITDA) of $97mn in the three months to end-June rose by 53pc from a year earlier, Clean Harbors said in an earnings statement.

SKSS is the re-refining and lube unit of Clean Harbors.

Profit rose at a faster pace than the 31pc rise in sales to $265.49mn.

The trend reflected the effect of two base oil price increases during the quarter, increasing revenue.

The company also benefited from improved management of waste-oil collection volumes and costs.

The unit’s profit margin rose in response.

Its EBITDA margin of 36.5pc was up from 31.3pc during the same time a year earlier and from an average of around 21pc in the five years to 2021.

Margins are expected to stay strong through the rest of the year as the company continues to benefit from strong base oil pricing and cost-reduction management.

The company said its re-refined base oils were also benefiting from growing demand for sustainable product alternatives.

It launched in June its ‘Kleen+’ brand in response to that trend and to capture the full value of its re-refined base oils.

It also bought a re-refinery in Georgia. The unit provides additional production capacity and cuts transportation costs for waste oils collected in southeastern US.

Clean Harbors raised its mid-point 2022 adjusted EBITDA guidance by $175mn to $990mn in response to the strong first-half earnings result and expectations that trend would continue through the second half of the year.