Onterris (5MO) Q3 2026 Earnings Report

The call was predominantly positive. Management reported record quarterly Adjusted EBITDA margins, strong quarterly cash flow and cash conversion, lower leverage, reaffirmed full-year guidance, raised long-term organic growth expectations, and described expanding opportunities in water treatment, methane monitoring, integrated services, and acquisitions. These positives were tempered by year-over-year and year-to-date revenue declines caused by the normalization of a prior-year environmental event, weaker Measurement and Analysis results, lower year-to-date cash flow and adjusted earnings, a year-to-date GAAP loss, and an ongoing strategic review with no assured outcome.

Onterris said full year 2026 guidance remains unchanged, with the midpoint implying a full year adjusted EBITDA margin of approximately 15.5%, approximately 150 basis points of expansion compared with 2025 and 290 basis points over the last three years; it expects operating cash flow conversion of at least 60% versus its long-term 50% target and year-end leverage of approximately 2.5x, inclusive of recently completed acquisition investments. Through 2030, it expects revenue CAGR of approximately 15% and Adjusted EBITDA CAGR of approximately 25%, assuming average organic revenue growth of approximately 10%, above its historically provided 7%-9% organic growth expectation; management also expects margins to reach “the high teens, low 20% margins” over a three-to-five-year period, not necessarily linear each year. The approximately $14 million of recent acquisitions are expected to have a de minimis impact on 2026 and be very accretive to the 2027-2030 timeframe, while 10% organic growth is a long-term trend, not formal guidance for 2027.