Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 27, 2018 | |
Document Document And Entity Information [Abstract] | ||
Entity Registrant Name | STERICYCLE INC | |
Entity Central Index Key | 861,878 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | SRCL | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 85,576,526 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
Revenues | $ 895 | $ 892.4 |
Cost of revenues | 536.5 | 523.7 |
Gross profit | 358.5 | 368.7 |
Selling, general and administrative expenses | 304.4 | 254.2 |
Income from operations | 54.1 | 114.5 |
Other income (expense): | ||
Interest expense, net | (25) | (23.3) |
Other expense, net | (1.5) | |
Income before income taxes | 29.1 | 89.7 |
Income tax expense | (6.6) | (31.1) |
Net income | 22.5 | 58.6 |
Net income attributable to noncontrolling interests | (0.4) | |
Net income attributable to Stericycle, Inc. | 22.5 | 58.2 |
Mandatory convertible preferred stock dividend | (8.8) | (9.4) |
Gain on repurchase of preferred stock | 7.3 | 4.6 |
Net income attributable to Stericycle, Inc. common shareholders | $ 21 | $ 53.4 |
Earnings per common share attributable to Stericycle, Inc. common shareholders: | ||
Basic | $ 0.25 | $ 0.63 |
Diluted | $ 0.25 | $ 0.62 |
Weighted average number of common shares outstanding: | ||
Basic | 85.5 | 85.2 |
Diluted | 85.8 | 85.6 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net income | $ 22.5 | $ 58.6 |
Other comprehensive income: | ||
Foreign currency translation adjustments | 16.3 | 26.5 |
Amortization of cash flow hedge into income, net of tax expense ($0.1 and $0.2 for the three months ended March 31, 2018 and 2017, respectively) | (0.1) | (0.3) |
Total other comprehensive income | 16.4 | 26.8 |
Comprehensive income | 38.9 | 85.4 |
Less: comprehensive income attributable to noncontrolling interests | 0.1 | 0.7 |
Comprehensive income attributable to Stericycle, Inc. common shareholders | $ 38.8 | $ 84.7 |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Amortization of cash flow hedge into income, tax expense | $ 0.1 | $ 0.2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Current Assets: | ||
Cash and cash equivalents | $ 49.4 | $ 42.2 |
Accounts receivable, less allowance for doubtful accounts of $67.9 in 2018 and $65.2 in 2017 | 633.5 | 624.1 |
Prepaid expenses | 61.8 | 80 |
Other current assets | 48.2 | 46.3 |
Assets held for sale | 17.7 | 20.8 |
Total Current Assets | 810.6 | 813.4 |
Property, plant and equipment, less accumulated depreciation of $635.2 in 2018 and $603.2 in 2017 | 748.9 | 741 |
Goodwill | 3,625.2 | 3,604 |
Intangible assets, less accumulated amortization of $424.7 in 2018 and $392.5 in 2017 | 1,771.2 | 1,791.5 |
Other assets | 59.8 | 38.4 |
Total Assets | 7,015.7 | 6,988.3 |
Current Liabilities: | ||
Current portion of long-term debt | 121.9 | 119.5 |
Bank overdrafts | 12.6 | 7 |
Accounts payable | 177 | 195.2 |
Accrued liabilities | 624.6 | 588.1 |
Other current liabilities | 58.7 | 54.5 |
Liabilities held for sale | 5.1 | 5.1 |
Total Current Liabilities | 999.9 | 969.4 |
Long-term debt, net | 2,586.2 | 2,615.3 |
Deferred income taxes | 357.4 | 371.1 |
Long-term taxes payable | 59.5 | 55.8 |
Other liabilities | 60.6 | 68.1 |
Total Liabilities | 4,063.6 | 4,079.7 |
Commitments and contingencies | ||
Equity: | ||
Preferred stock (par value $0.01 per share, 1.0 shares authorized), mandatory convertible preferred stock, Series A, 0.7 issued and outstanding in 2018 and 2017 | ||
Common stock (par value $0.01 per share, 120.0 shares authorized, 85.6 issued and outstanding in 2018 and 85.5 issued and outstanding in 2017) | 0.9 | 0.9 |
Additional paid-in capital | 1,146.3 | 1,153.2 |
Retained earnings | 2,063.5 | 2,029.5 |
Accumulated other comprehensive loss | (270.7) | (287) |
Total Stericycle, Inc.’s Equity | 2,940 | 2,896.6 |
Noncontrolling interests | 12.1 | 12 |
Total Equity | 2,952.1 | 2,908.6 |
Total Liabilities and Equity | $ 7,015.7 | $ 6,988.3 |
CONDENSED CONSOLIDATED BALANCE6
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 67.9 | $ 65.2 |
Property, plant and equipment, accumulated depreciation | 635.2 | 603.2 |
Intangible assets, accumulated amortization | $ 424.7 | $ 392.5 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, issued (in shares) | 658,190 | 700,000 |
Preferred stock, outstanding (in shares) | 658,190 | 700,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, issued (in shares) | 85,600,000 | 85,500,000 |
Common stock, outstanding (in shares) | 85,600,000 | 85,500,000 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
OPERATING ACTIVITIES: | ||
Net income | $ 22.5 | $ 58.6 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 30.8 | 29.1 |
Intangible amortization | 31.9 | 29.1 |
Stock-based compensation expense | 7.1 | 6 |
Deferred income taxes | (18.3) | 8.7 |
Asset impairment charges and loss on disposal of assets held for sale | 9.8 | 0.4 |
Other, net | (0.3) | 2.6 |
Changes in operating assets and liabilities, net of the effects of acquisitions and divestitures: | ||
Accounts receivable | (6.8) | 25.5 |
Prepaid expenses | 13.6 | (12.6) |
Accounts payable | (19.4) | (10) |
Accrued liabilities | 31.9 | 21.9 |
Other assets and liabilities | 7.6 | 9 |
Net cash provided by operating activities | 110.4 | 168.3 |
INVESTING ACTIVITIES: | ||
Capital expenditures | (28.5) | (33.1) |
Payments for acquisitions, net of cash acquired | (15.9) | (16.9) |
Other, net | 0.3 | 0.2 |
Net cash used in investing activities | (44.1) | (49.8) |
FINANCING ACTIVITIES: | ||
Repayments of long-term debt and other obligations | (12.2) | (12.8) |
Proceeds from foreign bank debt | 1.9 | 0.3 |
Repayment of foreign bank debt | (2.8) | (2.9) |
Repayment of term loan | (11.9) | (30) |
Proceeds from senior credit facility | 303.1 | 383.9 |
Repayment of senior credit facility | (332.1) | (446.2) |
Proceeds from bank overdrafts, net | 5.5 | 7 |
Payments of capital lease obligations | (1.6) | (0.9) |
Proceeds from issuance of common stock, net of shares withheld for taxes | 3.7 | 3.5 |
Payments for repurchase of mandatory convertible preferred stock | (7.4) | (9.6) |
Dividends paid on mandatory convertible preferred stock | (8.8) | (9.4) |
Net cash used in financing activities | (62.6) | (117.1) |
Effect of exchange rate changes on cash and cash equivalents | 3.5 | 1.4 |
Net change in cash and cash equivalents | 7.2 | 2.8 |
Cash and cash equivalents at beginning of period | 42.2 | 44.2 |
Cash and cash equivalents at end of period | 49.4 | 47 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Net issuances of obligations for acquisitions | 11.2 | 13.9 |
Capital expenditures in accounts payable | 5 | |
Interest paid during the period | 17 | 21.2 |
Income taxes paid during the period, net of refunds | $ 2.6 | $ 20.5 |
CONDENSED CONSOLIDATED STATEME8
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) shares in Millions, $ in Millions | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interests |
Beginning Balance at Dec. 31, 2016 | $ 2,816.4 | $ 0.8 | $ 1,166.5 | $ 2,006.1 | $ (367.6) | $ 10.6 | |
Beginning Balance (in shares) at Dec. 31, 2016 | 0.7 | 85.2 | |||||
Net income | 43 | 42.4 | 0.6 | ||||
Currency translation adjustment | 80.5 | 79.3 | 1.2 | ||||
Change in qualifying cash flow hedge, net of tax | 1.3 | 1.3 | |||||
Issuance of common stock for exercise of options and employee stock purchases, net of shares withheld for tax | 17.3 | $ 0.1 | 17.2 | ||||
Issuance of common stock for exercise of options and employee stock purchases, net of shares withheld for tax, (in shares) | 0.3 | ||||||
Purchase and cancellation of convertible preferred stock | (34.2) | (51.5) | 17.3 | ||||
Preferred stock dividend | (36.3) | (36.3) | |||||
Stock compensation expense | 21.3 | 21.3 | |||||
Reduction to noncontrolling interests due to additional ownership | (0.7) | (0.3) | (0.4) | ||||
Ending Balance at Dec. 31, 2017 | 2,908.6 | $ 0.9 | 1,153.2 | 2,029.5 | (287) | 12 | |
Ending Balance (in shares) at Dec. 31, 2017 | 0.7 | 85.5 | |||||
Net income | 22.5 | 22.5 | |||||
Currency translation adjustment | 16.3 | 16.2 | 0.1 | ||||
Change in qualifying cash flow hedge, net of tax | 0.1 | 0.1 | |||||
Issuance of common stock for exercise of options and employee stock purchases, net of shares withheld for tax | 0.7 | 0.7 | |||||
Issuance of common stock for exercise of options and employee stock purchases, net of shares withheld for tax, (in shares) | 0.1 | ||||||
Purchase and cancellation of convertible preferred stock | (7.4) | (14.7) | 7.3 | ||||
Preferred stock dividend | (8.8) | (8.8) | |||||
Stock compensation expense | 7.1 | 7.1 | |||||
Cumulative effect of new accounting standard (see Note 2) | 13 | 13 | |||||
Ending Balance at Mar. 31, 2018 | $ 2,952.1 | $ 0.9 | $ 1,146.3 | $ 2,063.5 | $ (270.7) | $ 12.1 | |
Ending Balance (in shares) at Mar. 31, 2018 | 0.7 | 85.6 |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business We are a business-to-business services provider with a focus on regulated and compliance solutions for healthcare, retail, and commercial businesses. This includes the collection and processing of regulated and specialized waste for disposal and the collection of personal and confidential information for secure destruction, plus a variety of training, consulting, recall/return, communication, and compliance services. We were incorporated in 1989 and presently serve a diverse customer base of more than one million customers throughout the United States, Argentina, Austria, Australia, Belgium, Brazil, Canada, Chile, France, Germany, Ireland, Japan, Luxembourg, Mexico, the Netherlands, Portugal, Republic of Korea, Romania, Singapore, Spain, and the United Kingdom. Summary of Significant Accounting Policies Basis of Presentation: The accompanying Condensed Consolidated Financial Statements include the accounts of Stericycle, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company's Condensed Consolidated Financial Statements were prepared in accordance with United States’ Generally Accepted Accounting Principles (“U.S. GAAP”) and include the assets, liabilities, revenue and expenses of all wholly-owned subsidiaries and majority-owned subsidiaries over which the Company exercises control. Outside shareholders' interests in subsidiaries are shown on the Consolidated Financial Statements as “Noncontrolling interests." The accompanying unaudited Condensed Consolidated Financial Statements as of March 31, 2018 and for the three months ended March 31, 2018 and 2017 have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim reporting and, therefore, do not include all information and footnote disclosures normally included in audited financial statements prepared in conformity with U.S. GAAP. However, in the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary to present fairly the results of operations, financial position and cash flows have been made. These Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto included in the 2017 Form 10-K. The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the full year. Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Some areas where we make estimates include our allowance for doubtful accounts, credit memo reserve, accrued employee health and welfare benefits, environmental liabilities, stock-based compensation expense, income tax liabilities, accrued auto and workers’ compensation insurance claims, intangible asset valuations, and goodwill impairment. Such estimates are based on historical trends and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from our estimates. The following information updates the description of significant accounting policies contained in Note 1 – Basis of Presentation and Summary of Significant Accounting Policies Adoption of New Accounting Standards: Revenue Recognition Effective January 1, 2018, the Company adopted ASU No. 2014-19, “Revenue from Contracts with Customers” (“ASC 606”) The impact of adopting ASC 606 relates to (i) the deferral of certain costs associated with obtaining contracts with customers, which were previously expensed as incurred, but under the new guidance are capitalized as Other current assets and Other assets and amortized to Selling, general and administrative expenses (“SG&A”) over the expected period of benefit to be received, (ii) the write off of deferred installation costs, which were capitalized, as Prepaid expenses under legacy U.S. GAAP but will be expensed as incurred under ASC 606 and (iii) an increase in Deferred income tax liabilities with respect to the tax impact associated with these items. We recognized a net increase to Retained earnings of $13.0 million as of January 1, 2018 for the cumulative effect of adopting ASC 606. This was comprised of $23.3 million associated with the capitalization of contract acquisition costs offset by $4.9 million write off of deferred installation costs and $5.4 million to recognize Deferred income tax liabilities. The impact to Income from operations from the adoption of ASC 606 was a decrease in SG&A of $3.6 million for the three months ended March 31, 2018. Definition of a Business Effective January 1, 2018, the Company adopted ASU No. 2017-01, “ Clarifying the Definition of a Business” (“ASU 2017-01”) Note 3 – Acquisitions, Intra-Entity Transfers of Assets Other Than Inventory On January 1, 2018, the Company adopted the guidance in ASU No. 2016-16, “Intra-Entity Transfers of Assets Other Than Inventory” (“ASU 2016-16”) Compensation – Stock Compensation On January 1, 2018, the Company adopted ASU No. 2017-09, “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting” (“ASU 2017-09”) Accounting Standards Issued But Not Yet Adopted Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02, “Leases” (Topic 842) (“ASU 2016-02”) Derivatives and Hedging In August 2017, the FASB issued ASU No. 2017-12, “ Derivatives and Hedging” (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017-12” Financial Instrument Credit Losses In June 2016, the FASB issued ASU No. 2016-13, “ Financial Instruments – Credit Losses” (“ASU 2016-13”) |
REVENUE FROM CONTRACTS WITH CUS
REVENUE FROM CONTRACTS WITH CUSTOMERS | 3 Months Ended |
Mar. 31, 2018 | |
Revenue From Contract With Customer [Abstract] | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | NOTE 2 – REVENUES FROM CONTRACTS WITH CUSTOMERS In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these good or services. Revenue is recognized net of revenue-based taxes assessed by governmental authorities. The Company provides regulated and compliance services, which include the collection and processing of regulated and specialized waste for disposal, the collection of personal and confidential information for secure destruction, and recall and returns (“Expert Solutions”), and communication services. The associated activities for each of these are a series of distinct services that are substantially the same and have the same pattern of transfer over time; therefore, the respective services are treated as a single performance obligation. The Company recognizes revenue by applying the right to invoice practical expedient as our right to consideration corresponds directly to the value provided to the customer for performance to date, Revenues for our Medical Waste Solutions and Secure Information Destruction Services are recognized upon waste collection. Our Compliance Solution revenues are recognized over the contractual service period. Revenues from Hazardous Waste Solutions and Manufacturing and Industrial Services are recognized at the time the waste is received by a facility with an appropriate permit, either our processing facility or a third party. Revenues from Communication Services and Expert Solutions are recorded as the services are performed. Our customers typically enter into a contract for the provision of services on a regular and scheduled basis, e.g. weekly, monthly or on an as needed basis over the contract term. Under the contract terms, the Company receives fees based on a monthly, quarterly or annual rate or fees based on contractual rates depending upon measures including the volume, weight and type of waste, number and size of bins collected, weight and type of shredded paper and number of call minutes. Amounts are invoiced based on the terms of the underlying contract either on a regular basis, e.g. monthly or quarterly, or as services are performed and are generally due within a short period of time after invoicing based upon normal terms and conditions for our business type and the geography of the services performed. Disaggregation of Revenues The following table presents our revenues disaggregated by service and primary geographical regions, and includes a reconciliation of disaggregated revenue to revenue reported by our reportable segments, Domestic and Canada Regulated Waste and Compliance Services (“RCS”) and International RCS: In millions Three Months Ended March 31, 2018 Reportable Segment Domestic and Canada RCS International RCS Other Revenues by Service: United States Canada Europe Others United States Total Medical Waste and Compliance Solutions $ 292.8 $ 9.8 $ 65.3 $ 52.0 $ - $ 419.9 Hazardous Waste Solutions 77.5 - - - - 77.5 Manufacturing and Industrial Services 58.8 5.5 8.7 12.8 - 85.8 Secure Information Destruction Services 170.3 16.2 30.4 3.0 - 219.9 Communication Services - 4.5 5.3 - 39.7 49.5 Expert Solutions - 3.1 2.8 - 36.5 42.4 Total $ 599.4 $ 39.1 $ 112.5 $ 67.8 $ 76.2 $ 895.0 Accounts Receivable Accounts receivable are recorded when billed or when goods or services are provided. The carrying value of our receivables is presented net of an allowance for doubtful accounts. We estimate our allowance for doubtful accounts based on past collection history and specific risks identified among uncollected amounts. If events or changes in circumstances indicate that specific receivable balances may be impaired, further consideration is given to the collectability of those balances and the allowance is adjusted accordingly. Past-due receivable balances are written off when our internal collection efforts have been exhausted. Contract Liabilities We record a contract liability when cash payments are received or due in advance of our services being performed and classify them as current in Other current liabilities on the Condensed Consolidated Balance Sheets since they are earned within a year. Substantially all our contract liabilities outstanding as of December 31, 2017 were recognized as revenues during the first quarter of 2018. The contract liability at March 31, 2018 was $18.1 million and is expected to be substantially recognized as revenue during the second quarter of 2018. Contract Acquisition Costs Our incremental direct costs of obtaining a contract, which consist primarily of sales incentives, are deferred and amortized to SG&A over the estimated period of benefit to be received from the cost, over a weighted average period of 6.2 years. We had $6.5 million and $21.4 million of contract acquisition costs, related to deferred sales incentives included in Other current assets and Other assets on the Condensed Consolidated Balance Sheets as of March 31, 2018. During the three months ended March 31, 2018, we amortized $1.6 million of sales incentives to SG&A. |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
ACQUISITIONS | NOTE 3 – ACQUISITIONS Acquisitions During the three months ended March 31, 2018, the Company completed 9 acquisitions of businesses under the current guidance. The following table summarizes the locations, services, and type of acquisitions for the three months ended March 31, 2018: Service Acquisition Locations Total Number of Acquisitions Regulated Waste Secure Information Destruction United States 9 1 8 Total 9 1 8 The following table summarizes the acquisition date fair value of consideration transferred for the current period acquisitions and the adjustment to the consideration transferred for the prior year acquisitions during the three months ended March 31, 2018: In millions Three Months Ended March 31, 2018 Current Year Acquisitions Adjustments to Prior Year Acquisitions Total Cash $ 15.9 $ - $ 15.9 Promissory notes 11.6 - 11.6 Contingent consideration - (0.4 ) (0.4 ) Total purchase price $ 27.5 $ (0.4 ) $ 27.1 For financial reporting purposes, our acquisitions were accounted for using the acquisition method of accounting. These acquisitions resulted in the recognition of goodwill in our financial statements, reflecting the excess of the purchase price paid over the fair value of the net assets acquired from these businesses that we believe are complementary to our existing operations and fit our growth strategy. During the three months ended March 31, 2018, we recognized an increase in goodwill of $17.9 million related to current year acquisitions, excluding the effect of foreign currency translation, which will be deductible for income taxes. During the three months ended March 31, 2018, we recognized an increase in estimated fair value of acquired customer relationships from current year acquisitions of $9.0 million, excluding the effect of foreign currency translation, with amortizable lives of 10 to 30 years. The fair value of consideration transferred in a business combination is allocated to the tangible and intangible assets assumed at the acquisition date, with the remaining unallocated amount recorded as goodwill. The allocations of the acquisition price for recent acquisitions have been prepared on a preliminary basis, pending completion of certain intangible asset valuations and finalization of the opening balance sheet. The following table summarizes the preliminary purchase price allocation for current period acquisitions and other adjustments to purchase price allocations for the three months ended March 31, 2018: In millions Three Months Ended March 31, 2018 Current Year Acquisitions Adjustments to Prior Year Acquisitions Total Fixed assets $ 0.2 $ 5.1 $ 5.3 Intangibles 9.0 0.6 9.6 Goodwill 17.9 (6.4 ) 11.5 Net other assets and liabilities 0.4 0.3 0.7 Total purchase price allocation $ 27.5 $ (0.4 ) $ 27.1 The results of operations of these acquired businesses have been included in the Condensed Consolidated Statements of Income from the date of the acquisition. Pro forma results of operations for these acquisitions are not presented because the pro forma effects, individually or in the aggregate, were not material to the Company’s consolidated results of operations. |
RESTRUCTURING, DIVESTITURES, AN
RESTRUCTURING, DIVESTITURES, AND ASSETS HELD FOR SALE | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring And Related Activities [Abstract] | |
RESTRUCTURING, DIVESTITURES, AND ASSETS HELD FOR SALE | NOTE 4 – RESTRUCTURING, DIVESTITURES AND ASSETS HELD FOR SALE Restructuring - Business Transformation Stericycle is focused on driving long-term growth, profitability and delivering enhanced shareholder value. As part of our business strategy, in the third quarter of 2017, we initiated a comprehensive multi-year Business Transformation with the objective to improve long-term operational and financial performance which we expect to complete by 2022, see Note 3 - Restructuring, Divestitures, and Assets Held For Sale Note 13 – Segment Reporting For the year ended December 31, 2017, we incurred There could be additional initiatives in the future to further streamline our operations. As such, the Company expects further charges related to workforce reductions and other facility rationalization costs when those restructuring plans are finalized and related charges are estimable. Divestitures and Assets Held for Sale There were no divestitures during the three months ended March 31, 2018 and 2017. As of March 31, 2018, certain of our international operations met the criteria to be classified as held for sale. For the three months ended March 31, 2018, we recorded a $4.1 million non-cash impairment charge in SG&A in the Condensed Consolidated Statements of Income related to changes in the fair value of assets held for sale in the U.K. The assets and liabilities of the disposal groups are presented in assets held for sale and liabilities held for sale on the Condensed Consolidated Balance Sheets. The following table presents information related to the major classes of assets and liabilities that were classified as held for sale on the Condensed Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017: In millions March 31, 2018 December 31, 2017 Total current assets $ 8.1 $ 7.7 Fixed assets 8.8 8.5 Goodwill - 1.6 Intangibles 0.8 2.6 Other assets - 0.4 Assets held for sale $ 17.7 $ 20.8 Total current liabilities $ 5.1 $ 4.7 Deferred income taxes - 0.4 Liabilities held for sale $ 5.1 $ 5.1 We determined that the operations included in the table above did not meet the criteria to be classified as discontinued operations as of March 31, 2018 and December 31, 2017. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 5 – GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill: Changes in the carrying amount of goodwill by reportable segment and for the “All Other” category were as follows: In millions Domestic and Canada RCS International RCS All Other Total Balance as of January 1, 2017 $ 2,811.8 $ 498.4 $ 280.8 $ 3,591.0 Goodwill acquired during year 36.9 4.9 4.7 46.5 Purchase accounting adjustments (10.1 ) 1.2 1.5 (7.4 ) Impairments during the year - (65.0 ) - (65.0 ) Write-offs related to disposition and assets held for sale - (7.1 ) - (7.1 ) Changes due to foreign currency fluctuations 11.6 34.4 - 46.0 Balance as of December 31, 2017 2,850.2 466.8 287.0 3,604.0 Goodwill acquired during period 17.9 - - 17.9 Purchase accounting adjustments (5.4 ) (0.2 ) (0.8 ) (6.4 ) Changes due to foreign currency fluctuations (3.9 ) 13.6 - 9.7 Balance as of March 31, 2018 $ 2,858.8 $ 480.2 $ 286.2 $ 3,625.2 Current period adjustments to goodwill for certain prior year acquisitions are primarily due to the finalization of intangible asset valuations among other opening balance sheet adjustments. Other Intangible Assets: As of March 31, 2018 and December 31, 2017, the values of other intangible assets were as follows: In millions March 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Amortization Net Value Gross Carrying Amount Accumulated Amortization Net Value Amortizable intangibles: Customer relationships $ 1,625.4 $ 413.0 $ 1,212.4 $ 1,613.4 $ 381.4 $ 1,232.0 Covenants not-to-compete 7.9 6.2 1.7 7.9 5.9 2.0 Tradenames 6.0 2.0 4.0 6.0 1.8 4.2 Other 16.1 3.5 12.6 17.0 3.4 13.6 Indefinite lived intangibles: Operating permits 222.3 - 222.3 222.3 - 222.3 Tradenames 318.2 - 318.2 317.4 - 317.4 Total $ 2,195.9 $ 424.7 $ 1,771.2 $ 2,184.0 $ 392.5 $ 1,791.5 Changes in the carrying amount of intangible assets were as follows: In millions Total Balance as of January 1, 2017 $ 1,862.0 Intangible assets acquired during the year 28.2 Valuation adjustments for prior year acquisitions 7.9 Write-offs due to disposition and amounts reclassified to assets held for sale (2.6 ) Impairments during the year (21.0 ) Amortization during the year (118.4 ) Changes due to foreign currency fluctuations 35.4 Balance as of December 31, 2017 1,791.5 Intangible assets acquired during the period 9.0 Valuation adjustments for prior year acquisitions 0.6 Impairments during the period (4.2 ) Amortization during the period (31.9 ) Changes due to foreign currency fluctuations 6.2 Balance as of March 31, 2018 $ 1,771.2 Our indefinite-lived intangible assets include permits and certain tradenames. We have determined that our permits and certain tradenames have indefinite lives due to our ability to renew them with minimal additional cost, and therefore these are not amortized. We perform our annual impairment test as of October 1. During the three months ended March 31, 2018, we impaired $1.2 million of operating permits and $3.0 million of customer relationships due to rationalizing certain operations across all segments. Our finite-lived intangible assets are amortized over their useful lives using the straight-line method. Our customer relationships have useful lives ranging from 10 to 30 years, based upon the type of customer, and a weighted average remaining useful life of 11.7 years. We have covenants not-to-compete with useful lives ranging from 5 to 14 years and a weighted average remaining useful life of 2.6 years. Our tradenames have useful lives ranging from 4 to 40 years and a weighted average remaining useful life of 15.3 years. Other intangibles mainly consist of landfill air rights with a remaining useful life of 16.5 years. During the three months ended March 31, 2018 and 2017, the aggregate intangible asset amortization expense was $31.9 million, and $29.1 million, respectively. The estimated amortization expense for each of the next five years (based upon exchange rates at March 31, 2018) is as follows for the years ended December 31: In millions 2018 $ 127.9 2019 $ 127.8 2020 $ 127.0 2021 $ 126.6 2022 $ 126.2 |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 6 – DEBT Long-term debt consisted of the following: In millions March 31, 2018 December 31, 2017 Obligations under capital leases $ 19.3 $ 9.4 $1.2 billion senior credit facility weighted average rate 2.74% in 2018 and 2.55% in 2017, due in 2022 446.9 471.7 $950 million term loan weighted average rate 3.20% in 2018 and 2.83% in 2017, due in 2022 938.1 950.0 $125 million private placement notes 2.68%, due in 2019 125.0 125.0 $225 million private placement notes 4.47%, due in 2020 225.0 225.0 $150 million private placement notes 2.89%, due in 2021 150.0 150.0 $125 million private placement notes 3.26%, due in 2022 125.0 125.0 $200 million private placement notes 2.72%, due in 2022 200.0 200.0 $100 million private placement notes 2.79%, due in 2023 100.0 100.0 $150 million private placement notes 3.18%, due in 2023 150.0 150.0 Promissory notes and deferred consideration weighted average rate 1.59% in 2018 and 1.49% in 2017 and weighted average maturity 2.9 years in 2018 and 2017 153.0 155.9 Foreign bank debt weighted average rate 5.38% in 2018 and 6.11% in 2017 and weighted average maturity 1.5 years in 2018 and 1.7 years in 2017 87.7 85.2 Total debt 2,720.0 2,747.2 Less: current portion of total debt 121.9 119.5 Less: unamortized debt issuance costs 11.9 12.4 Long-term portion of total debt $ 2,586.2 $ 2,615.3 Our senior credit facility, term loan, and the private placement notes all require us to comply with the same financial, reporting and other covenants and restrictions, including a restriction on dividend payments. At March 31, 2018, we were in compliance with all of our financial debt covenants. Our senior credit facility, term loan, and private placement notes rank pari passu to each other and all other unsecured debt obligations. At March 31, 2018 and December 31, 2017, we had $118.3 million and $130.8 million, respectively, committed to outstanding letters of credit under our senior credit facility. The unused portion of the revolving credit facility was $634.8 million and $597.5 million at March 31, 2018 and December 31, 2017, respectively. The obligations under the senior credit facility, term loan, and the private placement notes agreements are unsecured. All of these agreements contain a financial covenant to maintain a Consolidated Leverage Ratio of 3.75 to 1.00 at the end of any fiscal quarter. Following the settlement payment with respect to the pending small quantity customer class action lawsuit (see Note 14 – Legal Proceedings On March 23, 2018, the Company entered into certain amendments to its senior credit facility, term loan, and private placement note agreements related to the definition of EBITDA (as described in the credit agreements). The amendments allow for certain add-backs, up to a maximum of $200.0 million on a trailing twelve month basis, related to cash charges associated with Business Transformation, operational optimization and litigation matters, to the calculation of EBITDA for debt covenant compliance purposes. These amendments are in effect from January 1, 2018 through December 31, 2019. The interest rate calculation related to these agreements is subject to adjustment based on unadjusted leverage, which is calculated excluding the add-backs. If this unadjusted leverage is above 3.75, the interest rate on the senior credit facility and term loan would increase by 0.25%. The adjustment for the private placement notes would be calculated as follows: If the unadjusted leverage is above 3.75, the interest rate would increase: a) by 0.50% if the Company has a rating of BBB or better by S&P (or an equivalent rating by another rating agency), b) by an additional 0.25% if the Company has a rating of BBB- by S&P (or an equivalent rating by another rating agency), for a total of 0.75% above the rate otherwise applicable to such series of notes, and c) by an additional 0.50% if the Company has no rating or a rating of BB+ or worse by S&P (or an equivalent rating by another rating agency), for a total of 1.25% above the rate otherwise applicable to such series of notes. The Company applied the provisions of ASC 470-50, “Modifications and Extinguishments” |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 7 – INCOME TAXES The effective tax rates for the three months ended March 31, 2018 and 2017 were 22.7% and 34.7%, respectively. The decrease in the current quarter tax rate, when compared to the same quarter of the prior year, is primarily the result of the reduction in the United States (“U.S.”) federal tax rate from 35% to 21% in accordance with the U.S. Tax Cuts and Jobs Act of 2017 (the “Act”) effective for tax years beginning after December 31, 2017. Also impacting the rate within the quarter were certain tax reserve and deferred tax adjustments. In accordance with ASU 2018-05 and SAB 118, the Company recognized the provisional tax impacts related to the re-measurement of our deferred income tax assets and liabilities and the one-time, mandatory transition tax on deemed repatriation during the year ended December 31, 2017. As of March 31, 2018, we have not made any additional measurement-period adjustments related to these items. Such adjustments may be necessary in future periods due to, among other things, the significant complexity of the Act and anticipated additional regulatory guidance that may be issued by the U.S. Internal Revenue Service (“IRS”), changes in analysis, interpretations and assumptions the Company has made and actions the Company may take as a result of the Act. We are continuing to gather information to assess the application of the Act and expect to complete our analysis with the filing of our 2017 income tax returns during the fourth quarter of 2018. We file income tax returns in the U.S., in various states and in certain foreign jurisdictions. The Company has recorded liabilities to cover certain uncertain tax positions. Such uncertain tax positions relate to additional taxes that the Company may be required to pay in various tax jurisdictions. During the course of examinations by various taxing authorities, proposed adjustments may be asserted. The Company evaluates such items on a case-by-case basis and adjusts the accrual for uncertain tax positions as deemed necessary. The IRS has completed the audit of our 2014 corporate income tax return and made no changes to our reported tax. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 8 – FAIR VALUE MEASUREMENTS The following table summarizes the basis used to measure financial assets and liabilities that are carried at fair value on a recurring basis on the Condensed Consolidated Balance Sheets: In millions Fair Value Measurements Using Total as of March 31, 2018 Level 1 Inputs Level 2 Inputs Level 3 Inputs Assets: Derivative financial instruments $ 0.5 $ - $ 0.5 $ - Total assets $ 0.5 $ - $ 0.5 $ - Liabilities: Contingent consideration $ 12.5 $ - $ - $ 12.5 Total liabilities $ 12.5 $ - $ - $ 12.5 In millions Fair Value Measurements Using Total as of December 31, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Assets: Derivative financial instruments $ 0.4 $ - $ 0.4 $ - Total assets $ 0.4 $ - $ 0.4 $ - Liabilities: Contingent consideration $ 12.4 $ - $ - $ 12.4 Total liabilities $ 12.4 $ - $ - $ 12.4 For our derivative financial instruments, we use a market approach valuation technique based on observable market transactions of spot and forward rates. As of March 31, 2018 and December 31, 2017, we recorded an asset of $0.5 million and $0.4 million, respectively, related to the fair value of the U.S. dollar-Canadian dollar foreign currency swap which was classified as Other assets on the Condensed Consolidated Balance Sheets. The objective of the swap is to offset the foreign exchange risk to the U.S. dollar equivalent cash outflows for our Canadian subsidiary. Our contingent consideration liabilities are recorded using Level 3 inputs and were $12.5 million as of March 31, 2018, of which $4.7 million was classified as current liabilities. Contingent consideration liabilities were $12.4 million at December 31, 2017, of which $4.6 million was classified as current liabilities. Contingent consideration represents amounts expected to be paid as part of acquisition consideration only if certain future events occur. These events are usually the achievement of targets for revenues, earnings, or other milestones related to the business acquired. We arrive at the fair value of contingent consideration by applying a weighted probability of potential payment outcomes. The calculation of these potential outcomes is dependent on both past financial performance and management assumptions about future performance. If the financial performance measures were all fully met, our maximum liability would be $15.7 million at March 31, 2018. Contingent consideration liabilities are reassessed each reporting period and are reflected on the Condensed Consolidated Balance Sheets as part of Other current liabilities and Other liabilities. Changes to contingent consideration were as follows: In millions Contingent consideration as of January 1, 2017 $ 24.1 Increase due to current year acquisitions 0.1 Purchase accounting adjustments (9.6 ) Decrease due to payments (1.5 ) Change in fair value reflected in Selling, general, and administrative expenses (0.4 ) Other (0.3 ) Contingent consideration as of December 31, 2017 12.4 Purchase accounting adjustments (0.4 ) Change in fair value reflected in Selling, general, and administrative expenses 0.5 Contingent consideration as of March 31, 2018 $ 12.5 In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company is required to record certain assets and liabilities at fair value on a nonrecurring basis, generally as result of acquisitions or the remeasurement of assets resulting in impairment charges. See Note 3 – Acquisitions Note 4 – Restructuring, Divestitures and Assets Held for Sale, Fair Value of Debt: At March 31, 2018, the fair value of the Company’s debt obligations was estimated, using Level 2 inputs, at $2.69 billion compared to a carrying amount of $2.72 billion. At December 31, 2017, the fair value of the Company’s debt obligations was estimated, using Level 2 inputs, at $2.74 billion compared to a carrying amount of $2.75 billion. The fair values were estimated using an income approach by applying market interest rates for comparable instruments. Accounts receivable, accounts payable and accrued liabilities are financial assets and liabilities, respectively, with carrying values that approximate fair value, using Level 3 inputs. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 – COMMITMENTS AND CONTINGENCIES Environmental Remediation Liabilities We record a liability for environmental remediation when such liability becomes probable and the costs or damages can be reasonably estimated. We accrue environmental remediation costs, on an undiscounted basis, associated with identified sites where an assessment has indicated that cleanup costs are probable and can be reasonably estimated, but the timing of such payments is not fixed and determinable. Such accruals are based on currently available information, estimated timing of remedial actions, existing technology, and applicable laws and regulations. The liability for environmental remediation is included on the Condensed Consolidated Balance Sheets in current liabilities within Accrued liabilities and in noncurrent liabilities within Other liabilities. At March 31, 2018, the total environmental remediation liabilities recorded were $30.8 million, of which $6.2 million were presented in Accrued liabilities on the Condensed Consolidated Balance Sheets. At December 31, 2017, the total environmental remediation liabilities recorded were $30.8 million, of which $5.7 million were presented in Accrued liabilities on the Condensed Consolidated Balance Sheets. We project payments over approximately 30 years. During the second quarter of 2017, we recorded an environmental liability of $2.0 million related to a portion of a hazardous waste facility in Mexico. We continue to assess the level of remediation, as well as other potentially responsible parties, and will adjust our estimate in the future as appropriate. |
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
STOCK BASED COMPENSATION | NOTE 10 – STOCK-BASED COMPENSATION Stock-Based Compensation Expense: The following table presents the total stock-based compensation expense resulting from stock option awards, restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), and the Employee Stock Purchase Plan (“ESPP”) included in the Condensed Consolidated Statements of Income: In millions Three Months Ended March 31, 2018 2017 Selling, general and administrative - stock option plan $ 3.0 $ 4.1 Selling, general and administrative - RSUs 2.1 1.4 Selling, general and administrative - PSUs 1.6 0.2 Selling, general and administrative - ESPP 0.4 0.3 Total pre-tax expense $ 7.1 $ 6.0 Stock Options: Options granted to directors vest in one year and options granted to officers and employees generally vest over five years. Expense related to options with graded vesting is recognized using the straight-line method over the vesting period. Stock option activity for the three months ended March 31, 2018 is summarized as follows: Number of Options Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Life Total Aggregate Intrinsic Value (in years) (in millions) Outstanding at January 1, 2018 5,393,417 $ 96.91 Granted 338,834 62.13 Exercised (38,203 ) 53.63 Forfeited (71,348 ) 109.61 Canceled or expired (101,631 ) 102.66 Outstanding as of March 31, 2018 5,521,069 $ 94.81 4.54 $ 5.5 Exercisable as of March 31, 2018 3,951,661 $ 93.48 3.87 $ 5.5 At March 31, 2018, there was $29.3 million of total unrecognized compensation expense related to stock options, which is expected to be recognized over a weighted average period of 3.19 years. For the three months ended March 31, 2018 and 2017, the intrinsic value of options exercised was $0.6 million and $2.9 million, respectively. The exercise intrinsic value represents the total pre-tax intrinsic value (the difference between the fair value on the trading day the option was exercised and the exercise price associated with the respective option). The Company uses historical data to estimate expected life and volatility. The estimated fair value of stock options at the time of the grant using the Black-Scholes option pricing model was as follows: Three Months Ended March 31, 2018 2017 Stock options granted (shares) 338,834 425,599 Weighted average fair value at grant date $ 16.87 $ 19.53 Assumptions: Expected term (in years) 4.89 4.82 Expected volatility 25.33 % 22.66 % Expected dividend yield — % — % Risk free interest rate 2.57 % 1.91 % Restricted Stock Units: The fair value of RSUs is based on the closing price of the Company's common stock on the date of grant and is amortized to expense over the service period. RSUs generally vest over five years. A summary of the status of our non-vested RSUs and changes during the three months ended March 31, 2018, are as follows: Number of Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life Total Aggregate Intrinsic Value (in years) (in millions) Non-vested at January 1, 2018 267,297 $ 89.74 Granted 247,570 62.14 Vested and Released (51,302 ) 89.31 Forfeited (10,395 ) 90.32 Non-vested as of March 31, 2018 453,170 $ 74.43 2.53 $ 26.5 At March 31, 2018, there was $30.1 million of total unrecognized compensation expense related to RSUs, which is expected to be recognized over a weighted average period of 4.20 years. The fair value of RSUs that vested during the three months ended March 31, 2018 was $3.5 million. Performance-Based Restricted Stock Units: Our executive officers have been granted PSUs. These PSUs vest, or not, in three equal annual installments based on the achievement of pre-determined annual earnings per share performance goals, as approved by the Compensation Committee. In addition, certain employees have been granted PSUs which vest, or not, in four equal annual installments based on the achievement of performance goals related to the Business Transformation, as approved by the Compensation Committee. Each of the units granted represent the right to receive one share of the Company’s common stock at a specified future date. A summary of the status of our non-vested PSUs and changes during the three months ended March 31, 2018, are as follows: Number of Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life Total Aggregate Intrinsic Value (in years) (in millions) Non-vested at January 1, 2018 33,447 $ 82.85 Granted 399,658 62.09 Vested and Released - - Forfeited (12,880 ) 82.92 Non-vested as of March 31, 2018 420,225 $ 63.11 2.32 $ 24.6 At March 31, 2018, there was $5.5 million of total unrecognized compensation expense related to the 2018 installments of PSUs. |
PREFERRED STOCK
PREFERRED STOCK | 3 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
PREFERRED STOCK | NOTE 11 – PREFERRED STOCK At March 31, 2018, we had 1,000,000 authorized shares of preferred stock and 658,190 shares issued and outstanding of mandatory convertible preferred stock. We declared and paid dividends of $8.8 million and $9.4 million to the preferred stock shareholders during the three months ended March 31, 2018 and 2017, respectively. The following table provides information about our repurchases of depository shares of mandatory convertible preferred stock during the quarter ended March 31, 2018: In millions, except share and per share data Number of Depository Shares Repurchased Amount Paid for Repurchases Average Price Paid per Share January 1 - January 31, 2018 - $ - $ - February 1 - February 28 , 2018 151,900 7.4 49.05 March 1 - March 31 , 2018 - - - Total 151,900 $ 7.4 $ 49.05 For the three months ended March 31, 2018 and 2017, repurchases of our mandatory convertible preferred stock resulted in a $7.3 million and $4.6 million, respectively, increase in retained earnings, as we redeemed the preferred stock at a discount. The 151,900 depository shares are equivalent to 15,190 units of preferred stock. |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS PER COMMON SHARE | NOTE 12 – EARNINGS PER COMMON SHARE Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include outstanding stock options, shares to be purchased under the Company’s employee stock purchase plan, RSUs, PSUs and the assumed conversion of mandatory convertible preferred stock. The effect of potentially dilutive securities is reflected in diluted earnings per share by application of the "treasury stock method" for outstanding stock-based compensation awards. Under the treasury stock method, an increase in the fair market value of the Company’s common stock can result in a greater dilutive effect from potentially dilutive securities. For the issue of the mandatory convertible preferred stock, we use the "if-converted method." Under the if-converted method, the preferred dividend applicable to convertible preferred stock is added back as an adjustment to the numerator. The mandatory convertible preferred shares are assumed to be converted to common shares at the beginning of the period or, if later, at the time of issuance, and the resulting common shares are included in the denominator. In applying the if-converted method, conversion shall not be assumed for purposes of computing diluted earnings per share if the effect would be anti-dilutive. The numerator is also adjusted for any premium or discount arising from redemption of the preferred stock. The following table sets forth the computation of basic and diluted earnings per share: In millions, except per share data Three Months Ended March 31, 2018 2017 Numerator: Net income attributable to Stericycle, Inc. $ 22.5 $ 58.2 Mandatory convertible preferred stock dividend (8.8 ) (9.4 ) Gain on repurchase of preferred stock 7.3 4.6 Numerator for basic earnings per share attributable to Stericycle, Inc. common shareholders $ 21.0 $ 53.4 Denominator: Denominator for basic earnings per share - weighted average shares 85.5 85.2 Effect of dilutive securities: Stock-based compensation awards 0.3 0.4 Mandatory convertible preferred stock (1) - - Denominator for diluted earnings per share - adjusted weighted average shares and after assumed exercises 85.8 85.6 Earnings per share – Basic $ 0.25 $ 0.63 Earnings per share – Diluted $ 0.25 $ 0.62 (1) For the three months ended March 31, 2018 and 2017, the weighted average common shares (in thousands) issuable upon the assumed conversion of the mandatory convertible preferred stock totaling 4,903, and 5,264, respectively, were excluded from the computation of diluted earnings per share as such conversion would have been anti-dilutive. For the three months ended March 31, 2018 and 2017, options to purchase shares (in thousands) of 4,700 and 4,660, respectively, were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive. For the three months ended March 31, 2018 and 2017, RSUs (in thousands) of 51 and 135, respectively, were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive. During the three months ended March 31, 2018 and 2017, all of the Company’s outstanding PSUs are subject to the achievement of specified performance conditions. Contingently issuable shares are excluded from the computation of diluted earnings per share if, based on current period results, the shares would not be issuable if the end of the reporting period were the end of the contingency period. These outstanding PSUs were excluded from the earnings per share calculation for the three months ended March 31, 2018 and 2017, as the performance conditions were not satisfied as of the end of the respective periods. |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | NOTE 13 – SEGMENT REPORTING Our reportable segments are: • Domestic and Canada RCS • International RCS • All Other (which includes Domestic CRS, Corporate and shared services) Our Domestic and Canada, and International Regulated Waste and Compliance Services segments include medical waste disposal, pharmaceutical waste disposal, hazardous waste management, sustainability solutions for expired or unused inventory, secure information destruction of documents and e-media, training and consulting through our Steri-Safe® and Clinical Services programs, and other regulatory compliance services. All Other includes operations which consists of services including inbound/outbound communication, automated patient reminders, online scheduling, notifications, product retrievals, product returns, and quality audits, as well as expenses related to Corporate support, shared services functions, and stock-based compensation. Beginning in the first quarter of 2018, we have changed our measure of segment profitability to Adjusted Earnings Before Interest, Tax, Depreciation and Amortization (“Adjusted EBITDA”). Adjusted EBITDA is Income from operations excluding certain specified items, Depreciation and Intangible Amortization. As a result of this change in segment reporting, all applicable historical segment information has been revised to conform to the new presentation. The following tables show financial information for the Company's reportable segments: In millions Three Months Ended March 31, 2018 2017 Revenues Domestic and Canada RCS $ 638.5 $ 633.7 International RCS 180.3 181.6 All Other 76.2 77.1 Total $ 895.0 $ 892.4 Gross Profit Domestic and Canada RCS $ 260.5 $ 278.1 International RCS 62.8 58.5 All other 35.2 32.1 Total $ 358.5 $ 368.7 Depreciation Domestic and Canada RCS $ 17.9 $ 17.2 International RCS 7.3 7.8 All Other 5.6 4.1 Total $ 30.8 $ 29.1 Intangible Amortization Domestic and Canada RCS $ 23.2 $ 21.7 International RCS 6.6 5.4 All Other 2.1 2.0 Total $ 31.9 $ 29.1 Adjusted EBITDA Domestic and Canada RCS $ 190.0 $ 203.7 International RCS 33.0 27.9 All Other (33.7 ) (32.1 ) Total $ 189.3 $ 199.5 The following table reconciles the Company's primary measure of segment profitability (Adjusted EBITDA) to Income from operations: In millions Three Months Ended March 31, 2018 2017 Domestic and Canada RCS Adjusted EBITDA $ 190.0 $ 203.7 International RCS Adjusted EBITDA 33.0 27.9 All Other Adjusted EBITDA (33.7 ) (32.1 ) Depreciation (30.8 ) (29.1 ) Business Transformation (22.1 ) - Intangible Amortization (31.9 ) (29.1 ) Acquisition and Integration (4.1 ) (11.5 ) Operational Optimization (8.9 ) (10.9 ) Divestitures (4.1 ) - Litigation, Settlements and Regulatory Compliance (27.5 ) (1.9 ) Other (5.8 ) (2.5 ) Income from operations $ 54.1 $ 114.5 The following table presents consolidated revenues by service: In millions Three Months Ended March 31, 2018 2017 Regulated Waste and Compliance Services $ 497.4 $ 511.2 Secure Information Destruction Services 219.9 204.1 Communication and Related Services 91.9 93.5 Manufacturing and Industrial Services 85.8 83.6 Revenues $ 895.0 $ 892.4 |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 3 Months Ended |
Mar. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | NOTE 14 – LEGAL PROCEEDINGS We operate in highly regulated industries and must deal with regulatory inquiries or investigations from time to time that may be initiated for a variety of reasons. We are also involved in a variety of civil litigation from time to time. The Company establishes an accrued liability for loss contingencies related to legal and regulatory matters when the loss is both probable and reasonably estimable. If a loss is not probable or a probable loss is not reasonably estimable, no liability is recorded. These accruals represent management’s best estimate of probable losses and, in such cases, there may be an exposure to loss in excess of the amounts accrued. Legal and regulatory matters inherently involve significant uncertainties based on, among other factors, the stage of the proceedings, developments in the applicable facts or law, and the unpredictability of the ultimate determination of the merits of any claim, any defenses the Company may assert against that claim and the amount of any damages that may be awarded. The Company’s accrued liabilities for loss contingencies related to legal and regulatory matters may change in the future as a result of new developments, including, but not limited to, the occurrence of new legal matters, changes in the law or regulatory environment, adverse or favorable rulings, newly discovered facts relevant to the matter, or changes in the strategy for the matter. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Contract Class Action Lawsuits. We were served on March 12, 2013 with a class action complaint filed in the U.S. District Court for the Western District of Pennsylvania by an individual plaintiff for itself and on behalf of all other “similarly situated” customers of ours. The complaint alleged, among other things, that we had imposed unauthorized or excessive price increases and other charges on our customers in breach of our contracts and in violation of the Illinois Consumer Fraud and Deceptive Business Practices Act. The complaint sought certification of the lawsuit as a class action and the award to class members of appropriate damages and injunctive relief. The Pennsylvania class action complaint was filed in the wake of a settlement with the State of New York of an investigation under the New York False Claims Act which arose out of the qui tam (or “whistle blower”) action captioned United States of America ex rel. Jennifer D. Perez v. Stericycle, Inc., Case No. 1:08-cv-2390, which was settled in the fourth quarter of 2015 as previously disclosed. Following the filing of the Pennsylvania class action complaint, we were served with class action complaints filed in federal and state courts in several jurisdictions. These complaints asserted claims and allegations substantially similar to those made in the Pennsylvania class action complaint. All of these cases appear to be follow-on litigation to our settlement with the State of New York. On August 9, 2013, the Judicial Panel on Multidistrict Litigation granted our Motion to Transfer these related actions to the United States District Court for the Northern District of Illinois for centralized pretrial proceedings (the “MDL Action”). On December 10, 2013, we filed our answer to the Amended Consolidated Class Action Complaint in the MDL Action, generally denying the allegations therein . Plaintiffs filed a motion for class certification on January 29, 2016. On February 16, 2017, the Court entered an order granting plaintiffs’ motion for class certification. The Court certified a class of “[a]ll persons and entities that, between March 8, 2003 through the date of trial resided in the United States (except Washington and Alaska), were identified by Stericycle as ‘Small Quantity’ or ‘SQ’ customer, and were charged and paid more than their contractually-agreed price for Stericycle’s medical waste disposal goods and services pursuant to Stericycle’s automated price increase policy. Governmental entities whose claims were asserted in United States ex rel. Perez v. Stericycle Inc. shall be excluded from the class.” On March 2, 2017, Stericycle filed a motion for reconsideration and clarification relating to the Court’s class certification decision. The parties engaged in discussions through and overseen by a mediator regarding a potential resolution of the matter and reached an agreement in principle for settlement in July 2017 (the “Proposed MDL Settlement”). As we disclosed in a current report on Form 8-K filed on August 2, 2017, under the terms of the Proposed MDL Settlement, we will establish a common fund of $295.0 million from which will be paid all compensation to members of the settlement class, attorneys’ fees to class counsel, incentive awards to the named class representatives and all costs of notice and administration. Our existing contracts with customers will remain in force, while we will also establish as part of the Proposed MDL Settlement guidelines for future price increases and provide customers additional transparency regarding such increases. The Proposed MDL Settlement also addresses additional matters, including the availability of alternative dispute resolution for members of the settlement class. In the Proposed MDL Settlement, we are admitting no fault or wrongdoing whatsoever, and are entering into the Proposed MDL Settlement in order to avoid the cost and uncertainty of litigation. In view of the Proposed MDL Settlement, we recorded a pre-tax charge of $295.0 million during the second quarter of 2017. On October 17, 2017, the Company executed a definitive written settlement agreement (the “Settlement”), which incorporates the terms of the agreement in principle announced in August 2017. The Settlement incorporates the terms of the Proposed MDL Settlement, described above, and proposes a global resolution of all cases and claims against the Company in the MDL Action, including the allegation that price increases implemented by the Company allegedly violated the contracts between the Company and its customers as well as various state consumer protection statutes. Under the terms of the Settlement, the Company is admitting no fault or wrongdoing whatsoever, and it is entering into the Settlement in order to avoid the cost and uncertainty of litigation. The Settlement, upon final approval by the Court following a fairness hearing, will fully and finally resolve all claims against the Company alleged in the MDL Action. On October 17, 2017, plaintiffs in the MDL Action filed Plaintiffs’ Unopposed Motion for Preliminary Approval of Class Settlement and Approval of Notice Plan. Following a hearing on October 26, 2017, the Court granted preliminary approval of the Settlement and set certain deadlines, including for notification of the class of the terms of the Settlement, the submission of opt-outs or objections to the Settlement, and a fairness hearing. The fairness hearing was held on March 8, 2018. The Court granted approval of the Proposed MDL Settlement that same day. A hearing to address final opt out issues is currently scheduled for May 3, 2018 . Securities Class Action Lawsuit. On July 11, 2016, two purported stockholders filed a putative class action complaint in the U.S. District Court for the Northern District of Illinois. The plaintiffs purported to sue for themselves and on behalf of all purchasers of our publicly traded securities between February 7, 2013 and April 28, 2016, inclusive, and all those who purchased securities in our public offering of depositary shares, each representing a 1/10th interest in a share of our mandatory convertible preferred stock, on or around September 15, 2015. The complaint named as defendants the Company, our directors and certain of our current and former officers, and certain of the underwriters in the public offering. The complaint purports to assert claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as well as SEC Rule 10b-5, promulgated thereunder. The complaint alleges, among other things, that the Company imposed unauthorized or excessive price increases and other charges on its customers in breach of its contracts, and that defendants failed to disclose those alleged practices in public filings and other statements issued during the proposed class period beginning February 7, 2013 and ending April 28, 2016 . On August 4, 2016, plaintiffs filed an Amended Complaint that purports to assert additional misrepresentations in public statements through July 28, 2016, and therefore to change the putative class period to the period from February 7, 2013 to July 28, 2016, inclusive. On October 21, 2016, plaintiffs filed a Corrected Amended Complaint adding the Company as a named defendant in plaintiff’s claim under Section 11 of the Securities Act, which had previously been asserted only against the Underwriters and certain officers and directors. On November 1, 2016, the Court appointed the Public Employees’ Retirement System of Mississippi and the Arkansas Teacher Retirement System as Lead Plaintiffs and their counsel as Lead Counsel. On February 1, 2017, Lead Plaintiff filed a Consolidated Amended Complaint with additional purported factual material supporting the same legal claims from the prior complaints for a class period from February 7, 2013 through September 18, 2016. Defendants filed a motion to dismiss the Consolidated Amended Complaint on April 1, 2017. On May 19, 2017, plaintiffs filed a response in opposition to the motion to dismiss and on June 19, 2017, Defendants filed a reply brief in support of their motion. On March 31, 2018, plaintiffs filed a further Amended Complaint, alleging additional corrective disclosures and extending the purported class period through February 21, 2018. We intend to vigorously defend ourselves against this lawsuit. We have not accrued any amounts in respect of this lawsuit, and we cannot estimate the reasonably possible loss or the range of reasonably possible losses that we may incur. We are unable to make such an estimate because (i) litigation is by its nature uncertain and unpredictable, (ii) we do not know whether the court will certify any class of plaintiffs or, if any class is certified, how the class would be defined, and (iii) in our judgment, the factual and legal allegations asserted by plaintiffs are sufficiently unique that we are unable to identify other proceedings with circumstances sufficiently comparable to provide guidance in making estimates . Shareholder Derivative Lawsuits. On September 1, 2016, a purported stockholder filed a putative derivative action complaint in the Circuit Court of Cook County, Illinois against certain officers and directors of the Company, naming the Company as nominal defendant. The complaint alleges that defendants breached their fiduciary duties to the Company and its stockholders by causing the Company to allegedly overcharge certain customers in breach of those customers’ contracts, otherwise provide unsatisfactory customer service and injure customer relationships, and make materially false and misleading statements and omissions regarding the Company’s business, operational and compliance policies between February 7, 2013 and the present. On March 1, 2017, another purported stockholder filed a putative derivative action complaint containing substantially similar allegations in the Circuit Court of Cook County, Illinois against certain officers and directors of the Company, naming the Company as nominal defendant. The Company notes, among other things, that, in addition to failing to make the required demand on the board of directors, both of these filings are in violation of the Company’s Bylaws, which require any such actions to be brought in a court in Delaware. On June 29, 2017, the Court entered an agreed order consolidating the two putative derivative actions for all purposes under the caption Kausal Shah v. Charles A. Alutto, et al Additional putative derivative action complaints were subsequently filed by purported shareholders, containing similar allegations against certain officers and directors of the Company and naming the Company as nominal defendant. On March 26, 2018, Alvin Janklow v. Charles A. Alutto, et al. Rick Siu v. Mark C. Miller, et al. John Brennan v. Charles A. Alutto, et al. Brennan Siu Janklow We intend to vigorously defend ourselves against each of the derivative lawsuits. We have not accrued any amounts in respect of these lawsuits, and we cannot estimate the reasonably possible loss or the range of reasonably possible losses that we may incur. We are unable to make such an estimate because (i) litigation is by its nature uncertain and unpredictable and (ii) in our judgment, the factual and legal allegations asserted by plaintiffs are sufficiently unique that we are unable to identify other proceedings with circumstances sufficiently comparable to provide guidance in making estimates . Shareholder Demand Letter. On October 18, 2016, the Company received a letter from an attorney purporting to represent a current stockholder of the Company demanding, pursuant to Del. Ct. Ch. R. 23.1, that the Company’s Board of Directors take action to remedy alleged breaches of fiduciary duties by certain officers and directors of the Company. The factual allegations set forth in the letter are similar to those asserted in the Securities Class Action Lawsuit and the Shareholder Derivative Lawsuits. The letter asserts breaches of fiduciary duty in connection with the management, operation and oversight of the Company’s business and in connection with alleged false, misleading and/or incomplete statements regarding the Company’s business practices. The Company’s Board of Directors constituted a Special Demand Review Committee to investigate the claims made in the demand letter and the Committee retained independent counsel to assist with the investigation. At the conclusion of its investigation, the Committee’s counsel advised the stockholder that the board had completed its investigation and determined not to pursue legal action . TCPA Lawsuit. On June 3, 2016, a plaintiff filed a putative class action, captioned Ibrahim v. Stericycle, Inc. , No. 16-cv-4294 (N.D. Ill.), against us and our wholly-owned subsidiary, Stericycle Communication Solutions, Inc., under the Telephone Consumer Protection Act (“TCPA”), asserting that the defendants called plaintiff and others in violation of that statute. Plaintiff challenges our use of pre-recorded messages that urge the owners of recalled products to return or obtain repairs for those products. Plaintiff seeks certification of two nationwide classes. One class includes people who received one or more cellular telephone calls from Stericycle featuring a prerecorded or artificial voice message relating to a product recall, where the called party was not the same individual who, according to Stericycle’s records, was the intended recipient of the call. The second class includes people who received one or more cellular telephone calls from Stericycle featuring a prerecorded or artificial voice message relating to a product recall after such person had communicated to Stericycle that Stericycle did not have consent to make any such calls to their cellular telephone number. On July 28, 2016, we answered the complaint, denying the material allegations and raising certain affirmative defenses. Among the asserted defenses is the “emergency” exception to the TCPA, which exempts calls made to promote public health and safety. On December 19, 2016, before any substantial discovery in the case, we filed a motion for summary judgment primarily on the basis of the “emergency” exception. On February 1, 2017, plaintiff responded to our motion by requesting additional discovery. The court permitted plaintiff to obtain some but not all of the requested discovery, and we have provided additional documents in response to that order. On April 5, 2017, plaintiff sought leave to file an amended complaint which would add a claim under the Illinois Automatic Telephone Dialers Act (which does not include an “emergency” exception) and certain additional allegations. We filed an opposition to this motion on April 28, 2017, contending that the proposed amendments are futile and that we are entitled to summary judgment. On June 27, 2017, the court permitted plaintiff to file the amended complaint. We have answered plaintiff’s amended complaint, denying liability, and in light of the amended complaint, have withdrawn our motion for summary judgment without prejudice. The parties are currently conducting discovery. The deadline for completion of fact discovery is May 15, 2018. We intend to vigorously defend ourselves against this lawsuit. We have not accrued any amounts in respect of this lawsuit, and we cannot estimate the reasonably possible loss or the range of reasonably possible losses that we may incur. We are unable to make such an estimate because (i) litigation is by its nature uncertain and unpredictable, (ii) we do not know whether the court will certify any class of plaintiffs or, if any class is certified, how the class would be defined, and (iii) in our judgment, the factual and legal allegations asserted by plaintiff are sufficiently unique that we are unable to identify other proceedings with circumstances sufficiently comparable to provide guidance in making estimates . FCPA Investigation. On June 12, 2017, the SEC issued a subpoena to the Company, requesting documents and information relating to the Company’s compliance with the Foreign Corrupt Practices Act (“FCPA”) or other foreign or domestic anti-corruption laws with respect to certain of the Company’s operations in Latin America. In addition, the Department of Justice has notified the Company that it is investigating this matter in parallel with the SEC. The Company is cooperating with these agencies. The Company is also conducting an internal investigation of these and other matters, including outside of Latin America, under the oversight of the Audit Committee of the Board of Directors and with the assistance of outside counsel, and this investigation has found evidence of improper conduct. We have not accrued any amounts in respect of this matter, as we cannot estimate any reasonably possible loss or any range of reasonably possible losses that we may incur. We are unable to make such an estimate because, based on what we know now, in our judgment, the factual and legal issues presented in this matter are sufficiently unique that we are unable to identify other circumstances sufficiently comparable to provide guidance in making estimates . Environmental Matters. Our Environmental Solutions business is regulated by federal, state and local laws enacted to regulate the discharge of materials into the environment, remediate contaminated soil and groundwater or otherwise protect the environment. As a result of this continuing regulation, we frequently become a party to legal or administrative proceedings involving various governmental authorities and other interested parties. The issues involved in these proceedings generally relate to alleged violations of existing permits and licenses or alleged responsibility under federal or state Superfund laws to remediate contamination at properties owned either by us or by other parties to which either we or the prior owners of certain of its facilities shipped wastes. From time to time, we may be subject to fines or penalties in regulatory proceedings relating primarily to waste treatment, storage or disposal facilities. North Salt Lake, Utah. On February 29, 2016, we entered into a statute of limitations tolling agreement with the United States Attorney’s Office for the District of Utah (the “USAO”) relating to an investigation by the USAO and the Criminal Investigation Division of the U.S. Environmental Protection Agency (the “EPA”) of the same facts underlying the notice of violation (the “NOV”) issued by the State of Utah Division of Air Quality (the “DAQ”) that resulted in our December 2014 settlement with the DAQ that we have previously disclosed. The USAO and EPA are investigating whether the matters forming the basis of the NOV constitute criminal or civil violations of the Clean Air Act and other federal statutes. The government has indicated that the matter will be resolved civilly and the parties are beginning settlement negotiations regarding a civil consent decree and a civil penalty. The Company has recorded its estimate of the probable loss for this matter which is not material. Rancho Cordova, California. The California Department of Toxic Substances Control (“DTSC”) has alleged violations of California’s Hazardous Waste Control Law for our hazardous waste facility in Rancho Cordova, California for the years 2011 through 2017. DTSC has referred the matter to the California Attorney General’s office. On March 3, 2016, we entered into a tolling agreement with the Attorney General’s office, which was subsequently extended through October 30, 2017. Under the tolling agreement as extended, the period from February 29, 2016 through October 30, 2017 will be excluded from any calculation of time for the purpose of determining the statute of limitations concerning any charges that we violated the Hazardous Waste Control Law. The tolling agreement does not constitute an admission of guilt or wrongdoing on our part and cannot be construed as a waiver of any other rights or defenses that we may have in any resulting action or proceeding. On October 26, 2017, DTSC filed a complaint in California Superior Court in Sacramento County for civil penalties and injunctive relief for alleged violations of California's Hazardous Waste Control Law. We continue to engage in discussions with DTSC regarding the parties’ current factual and legal positions. We will continue to evaluate DTSC’s position and to explore a number of potential alternatives, including a negotiated resolution and potential litigation. The Company has recorded its estimate of the probable loss for this matter which is not material. Tabasco, Mexico. The National Agency for Industrial Security and the Protection of the Environment for the Hydrocarbon Sector in Mexico (“ASEA”) has conducted a permit compliance inspection at a hazardous waste treatment facility acquired by one of our subsidiaries in Dos Bocas, Tabasco, Mexico. ASEA has claimed that the contaminated soil treatment process described in the treatment permit had not been followed properly and has issued an order imposing a fine and directing that the facility be closed and that alleged contamination on a certain portion of the facility be remediated. Our subsidiary has engaged a firm of environmental technicians to assess the contamination described in the ASEA order and to conduct a broader environmental assessment of the facility. The preliminary estimate of the remediation costs necessary to address the ASEA order was $2.0 million. Our review and assessment of the overall facility is ongoing. In November 2017, ASEA rescinded the prior order imposing the fine. After reassessing the evidence and arguments presented, ASEA issued a new resolution on March 9, 2018, containing a lower, revised fine and including remedial obligations. In March 2018, the Company submitted a proposal for remedial measures. On April 26, 2018, the Company appealed the fines in the most recent order. Separately, the Company has implemented certain remedial measures to address site conditions during periods of increased precipitation. These near term remedial measures are also subject to the review and approval of ASEA. At this time we are unable to reasonably estimate the future cost of any remedial obligations at the facility beyond the preliminary estimate to comply with the ASEA order, see Note 9 – Commitments and Contingencies . |
BASIS OF PRESENTATION AND SUM23
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation: The accompanying Condensed Consolidated Financial Statements include the accounts of Stericycle, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company's Condensed Consolidated Financial Statements were prepared in accordance with United States’ Generally Accepted Accounting Principles (“U.S. GAAP”) and include the assets, liabilities, revenue and expenses of all wholly-owned subsidiaries and majority-owned subsidiaries over which the Company exercises control. Outside shareholders' interests in subsidiaries are shown on the Consolidated Financial Statements as “Noncontrolling interests." The accompanying unaudited Condensed Consolidated Financial Statements as of March 31, 2018 and for the three months ended March 31, 2018 and 2017 have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim reporting and, therefore, do not include all information and footnote disclosures normally included in audited financial statements prepared in conformity with U.S. GAAP. However, in the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary to present fairly the results of operations, financial position and cash flows have been made. These Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto included in the 2017 Form 10-K. The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the full year. |
Use of Estimates | Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Some areas where we make estimates include our allowance for doubtful accounts, credit memo reserve, accrued employee health and welfare benefits, environmental liabilities, stock-based compensation expense, income tax liabilities, accrued auto and workers’ compensation insurance claims, intangible asset valuations, and goodwill impairment. Such estimates are based on historical trends and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from our estimates. The following information updates the description of significant accounting policies contained in Note 1 – Basis of Presentation and Summary of Significant Accounting Policies |
New Accounting Standards | Adoption of New Accounting Standards: Revenue Recognition Effective January 1, 2018, the Company adopted ASU No. 2014-19, “Revenue from Contracts with Customers” (“ASC 606”) The impact of adopting ASC 606 relates to (i) the deferral of certain costs associated with obtaining contracts with customers, which were previously expensed as incurred, but under the new guidance are capitalized as Other current assets and Other assets and amortized to Selling, general and administrative expenses (“SG&A”) over the expected period of benefit to be received, (ii) the write off of deferred installation costs, which were capitalized, as Prepaid expenses under legacy U.S. GAAP but will be expensed as incurred under ASC 606 and (iii) an increase in Deferred income tax liabilities with respect to the tax impact associated with these items. We recognized a net increase to Retained earnings of $13.0 million as of January 1, 2018 for the cumulative effect of adopting ASC 606. This was comprised of $23.3 million associated with the capitalization of contract acquisition costs offset by $4.9 million write off of deferred installation costs and $5.4 million to recognize Deferred income tax liabilities. The impact to Income from operations from the adoption of ASC 606 was a decrease in SG&A of $3.6 million for the three months ended March 31, 2018. Definition of a Business Effective January 1, 2018, the Company adopted ASU No. 2017-01, “ Clarifying the Definition of a Business” (“ASU 2017-01”) Note 3 – Acquisitions, Intra-Entity Transfers of Assets Other Than Inventory On January 1, 2018, the Company adopted the guidance in ASU No. 2016-16, “Intra-Entity Transfers of Assets Other Than Inventory” (“ASU 2016-16”) Compensation – Stock Compensation On January 1, 2018, the Company adopted ASU No. 2017-09, “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting” (“ASU 2017-09”) Accounting Standards Issued But Not Yet Adopted Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02, “Leases” (Topic 842) (“ASU 2016-02”) Derivatives and Hedging In August 2017, the FASB issued ASU No. 2017-12, “ Derivatives and Hedging” (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017-12” Financial Instrument Credit Losses In June 2016, the FASB issued ASU No. 2016-13, “ Financial Instruments – Credit Losses” (“ASU 2016-13”) |
REVENUE FROM CONTRACTS WITH C24
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Revenue From Contract With Customer [Abstract] | |
Schedule of Revenues Disaggregated by Service, Primary Geographical Regions and Timing of Revenue Recognition | The following table presents our revenues disaggregated by service and primary geographical regions, and includes a reconciliation of disaggregated revenue to revenue reported by our reportable segments, Domestic and Canada Regulated Waste and Compliance Services (“RCS”) and International RCS: In millions Three Months Ended March 31, 2018 Reportable Segment Domestic and Canada RCS International RCS Other Revenues by Service: United States Canada Europe Others United States Total Medical Waste and Compliance Solutions $ 292.8 $ 9.8 $ 65.3 $ 52.0 $ - $ 419.9 Hazardous Waste Solutions 77.5 - - - - 77.5 Manufacturing and Industrial Services 58.8 5.5 8.7 12.8 - 85.8 Secure Information Destruction Services 170.3 16.2 30.4 3.0 - 219.9 Communication Services - 4.5 5.3 - 39.7 49.5 Expert Solutions - 3.1 2.8 - 36.5 42.4 Total $ 599.4 $ 39.1 $ 112.5 $ 67.8 $ 76.2 $ 895.0 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Summary of Location, Services and Type of Acquisitions | The following table summarizes the locations, services, and type of acquisitions for the three months ended March 31, 2018: Service Acquisition Locations Total Number of Acquisitions Regulated Waste Secure Information Destruction United States 9 1 8 Total 9 1 8 |
Summary of Fair Value of Consideration Transferred for Current Period and Prior Year Acquisitions | The following table summarizes the acquisition date fair value of consideration transferred for the current period acquisitions and the adjustment to the consideration transferred for the prior year acquisitions during the three months ended March 31, 2018: In millions Three Months Ended March 31, 2018 Current Year Acquisitions Adjustments to Prior Year Acquisitions Total Cash $ 15.9 $ - $ 15.9 Promissory notes 11.6 - 11.6 Contingent consideration - (0.4 ) (0.4 ) Total purchase price $ 27.5 $ (0.4 ) $ 27.1 |
Purchase Price Allocation | The following table summarizes the preliminary purchase price allocation for current period acquisitions and other adjustments to purchase price allocations for the three months ended March 31, 2018: In millions Three Months Ended March 31, 2018 Current Year Acquisitions Adjustments to Prior Year Acquisitions Total Fixed assets $ 0.2 $ 5.1 $ 5.3 Intangibles 9.0 0.6 9.6 Goodwill 17.9 (6.4 ) 11.5 Net other assets and liabilities 0.4 0.3 0.7 Total purchase price allocation $ 27.5 $ (0.4 ) $ 27.1 |
RESTRUCTURING, DIVESTITURES, 26
RESTRUCTURING, DIVESTITURES, AND ASSETS HELD FOR SALE (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Assets and Liabilities Held for Sale, Not Discontinued Operations | |
Summary of Major Classes of Assets and Liabilities Classified as Held for Sale | The following table presents information related to the major classes of assets and liabilities that were classified as held for sale on the Condensed Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017: In millions March 31, 2018 December 31, 2017 Total current assets $ 8.1 $ 7.7 Fixed assets 8.8 8.5 Goodwill - 1.6 Intangibles 0.8 2.6 Other assets - 0.4 Assets held for sale $ 17.7 $ 20.8 Total current liabilities $ 5.1 $ 4.7 Deferred income taxes - 0.4 Liabilities held for sale $ 5.1 $ 5.1 |
GOODWILL AND OTHER INTANGIBLE27
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill by reportable segment and for the “All Other” category were as follows: In millions Domestic and Canada RCS International RCS All Other Total Balance as of January 1, 2017 $ 2,811.8 $ 498.4 $ 280.8 $ 3,591.0 Goodwill acquired during year 36.9 4.9 4.7 46.5 Purchase accounting adjustments (10.1 ) 1.2 1.5 (7.4 ) Impairments during the year - (65.0 ) - (65.0 ) Write-offs related to disposition and assets held for sale - (7.1 ) - (7.1 ) Changes due to foreign currency fluctuations 11.6 34.4 - 46.0 Balance as of December 31, 2017 2,850.2 466.8 287.0 3,604.0 Goodwill acquired during period 17.9 - - 17.9 Purchase accounting adjustments (5.4 ) (0.2 ) (0.8 ) (6.4 ) Changes due to foreign currency fluctuations (3.9 ) 13.6 - 9.7 Balance as of March 31, 2018 $ 2,858.8 $ 480.2 $ 286.2 $ 3,625.2 |
Carrying Values of Other Intangible Assets | As of March 31, 2018 and December 31, 2017, the values of other intangible assets were as follows: In millions March 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Amortization Net Value Gross Carrying Amount Accumulated Amortization Net Value Amortizable intangibles: Customer relationships $ 1,625.4 $ 413.0 $ 1,212.4 $ 1,613.4 $ 381.4 $ 1,232.0 Covenants not-to-compete 7.9 6.2 1.7 7.9 5.9 2.0 Tradenames 6.0 2.0 4.0 6.0 1.8 4.2 Other 16.1 3.5 12.6 17.0 3.4 13.6 Indefinite lived intangibles: Operating permits 222.3 - 222.3 222.3 - 222.3 Tradenames 318.2 - 318.2 317.4 - 317.4 Total $ 2,195.9 $ 424.7 $ 1,771.2 $ 2,184.0 $ 392.5 $ 1,791.5 |
Changes in Carrying Amount of Intangible Assets | Changes in the carrying amount of intangible assets were as follows: In millions Total Balance as of January 1, 2017 $ 1,862.0 Intangible assets acquired during the year 28.2 Valuation adjustments for prior year acquisitions 7.9 Write-offs due to disposition and amounts reclassified to assets held for sale (2.6 ) Impairments during the year (21.0 ) Amortization during the year (118.4 ) Changes due to foreign currency fluctuations 35.4 Balance as of December 31, 2017 1,791.5 Intangible assets acquired during the period 9.0 Valuation adjustments for prior year acquisitions 0.6 Impairments during the period (4.2 ) Amortization during the period (31.9 ) Changes due to foreign currency fluctuations 6.2 Balance as of March 31, 2018 $ 1,771.2 |
Estimated Amortization Expense | The estimated amortization expense for each of the next five years (based upon exchange rates at March 31, 2018) is as follows for the years ended December 31: In millions 2018 $ 127.9 2019 $ 127.8 2020 $ 127.0 2021 $ 126.6 2022 $ 126.2 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-term debt consisted of the following: In millions March 31, 2018 December 31, 2017 Obligations under capital leases $ 19.3 $ 9.4 $1.2 billion senior credit facility weighted average rate 2.74% in 2018 and 2.55% in 2017, due in 2022 446.9 471.7 $950 million term loan weighted average rate 3.20% in 2018 and 2.83% in 2017, due in 2022 938.1 950.0 $125 million private placement notes 2.68%, due in 2019 125.0 125.0 $225 million private placement notes 4.47%, due in 2020 225.0 225.0 $150 million private placement notes 2.89%, due in 2021 150.0 150.0 $125 million private placement notes 3.26%, due in 2022 125.0 125.0 $200 million private placement notes 2.72%, due in 2022 200.0 200.0 $100 million private placement notes 2.79%, due in 2023 100.0 100.0 $150 million private placement notes 3.18%, due in 2023 150.0 150.0 Promissory notes and deferred consideration weighted average rate 1.59% in 2018 and 1.49% in 2017 and weighted average maturity 2.9 years in 2018 and 2017 153.0 155.9 Foreign bank debt weighted average rate 5.38% in 2018 and 6.11% in 2017 and weighted average maturity 1.5 years in 2018 and 1.7 years in 2017 87.7 85.2 Total debt 2,720.0 2,747.2 Less: current portion of total debt 121.9 119.5 Less: unamortized debt issuance costs 11.9 12.4 Long-term portion of total debt $ 2,586.2 $ 2,615.3 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Assets and Liabilities Carried at Fair Value on Recurring Basis | The following table summarizes the basis used to measure financial assets and liabilities that are carried at fair value on a recurring basis on the Condensed Consolidated Balance Sheets: In millions Fair Value Measurements Using Total as of March 31, 2018 Level 1 Inputs Level 2 Inputs Level 3 Inputs Assets: Derivative financial instruments $ 0.5 $ - $ 0.5 $ - Total assets $ 0.5 $ - $ 0.5 $ - Liabilities: Contingent consideration $ 12.5 $ - $ - $ 12.5 Total liabilities $ 12.5 $ - $ - $ 12.5 In millions Fair Value Measurements Using Total as of December 31, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Assets: Derivative financial instruments $ 0.4 $ - $ 0.4 $ - Total assets $ 0.4 $ - $ 0.4 $ - Liabilities: Contingent consideration $ 12.4 $ - $ - $ 12.4 Total liabilities $ 12.4 $ - $ - $ 12.4 |
Changes to Contingent Consideration | Changes to contingent consideration were as follows: In millions Contingent consideration as of January 1, 2017 $ 24.1 Increase due to current year acquisitions 0.1 Purchase accounting adjustments (9.6 ) Decrease due to payments (1.5 ) Change in fair value reflected in Selling, general, and administrative expenses (0.4 ) Other (0.3 ) Contingent consideration as of December 31, 2017 12.4 Purchase accounting adjustments (0.4 ) Change in fair value reflected in Selling, general, and administrative expenses 0.5 Contingent consideration as of March 31, 2018 $ 12.5 |
STOCK BASED COMPENSATION (Table
STOCK BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation Expense Resulting from Stock Option Awards, RSUs, PSUs and ESPP | The following table presents the total stock-based compensation expense resulting from stock option awards, restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), and the Employee Stock Purchase Plan (“ESPP”) included in the Condensed Consolidated Statements of Income: In millions Three Months Ended March 31, 2018 2017 Selling, general and administrative - stock option plan $ 3.0 $ 4.1 Selling, general and administrative - RSUs 2.1 1.4 Selling, general and administrative - PSUs 1.6 0.2 Selling, general and administrative - ESPP 0.4 0.3 Total pre-tax expense $ 7.1 $ 6.0 |
Stock Option Activity | Stock option activity for the three months ended March 31, 2018 is summarized as follows: Number of Options Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Life Total Aggregate Intrinsic Value (in years) (in millions) Outstanding at January 1, 2018 5,393,417 $ 96.91 Granted 338,834 62.13 Exercised (38,203 ) 53.63 Forfeited (71,348 ) 109.61 Canceled or expired (101,631 ) 102.66 Outstanding as of March 31, 2018 5,521,069 $ 94.81 4.54 $ 5.5 Exercisable as of March 31, 2018 3,951,661 $ 93.48 3.87 $ 5.5 |
Assumptions Used in Black-Scholes Option Pricing Model | The estimated fair value of stock options at the time of the grant using the Black-Scholes option pricing model was as follows: Three Months Ended March 31, 2018 2017 Stock options granted (shares) 338,834 425,599 Weighted average fair value at grant date $ 16.87 $ 19.53 Assumptions: Expected term (in years) 4.89 4.82 Expected volatility 25.33 % 22.66 % Expected dividend yield — % — % Risk free interest rate 2.57 % 1.91 % |
Summary of RSU Activity | A summary of the status of our non-vested RSUs and changes during the three months ended March 31, 2018, are as follows: Number of Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life Total Aggregate Intrinsic Value (in years) (in millions) Non-vested at January 1, 2018 267,297 $ 89.74 Granted 247,570 62.14 Vested and Released (51,302 ) 89.31 Forfeited (10,395 ) 90.32 Non-vested as of March 31, 2018 453,170 $ 74.43 2.53 $ 26.5 |
Summary of PSU Activity | A summary of the status of our non-vested PSUs and changes during the three months ended March 31, 2018, are as follows: Number of Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life Total Aggregate Intrinsic Value (in years) (in millions) Non-vested at January 1, 2018 33,447 $ 82.85 Granted 399,658 62.09 Vested and Released - - Forfeited (12,880 ) 82.92 Non-vested as of March 31, 2018 420,225 $ 63.11 2.32 $ 24.6 |
PREFERRED STOCK (Tables)
PREFERRED STOCK (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
Repurchases of Depository Shares of Mandatory Convertible Preferred Stock | The following table provides information about our repurchases of depository shares of mandatory convertible preferred stock during the quarter ended March 31, 2018: In millions, except share and per share data Number of Depository Shares Repurchased Amount Paid for Repurchases Average Price Paid per Share January 1 - January 31, 2018 - $ - $ - February 1 - February 28 , 2018 151,900 7.4 49.05 March 1 - March 31 , 2018 - - - Total 151,900 $ 7.4 $ 49.05 |
EARNINGS PER COMMON SHARE (Tabl
EARNINGS PER COMMON SHARE (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | The following table sets forth the computation of basic and diluted earnings per share: In millions, except per share data Three Months Ended March 31, 2018 2017 Numerator: Net income attributable to Stericycle, Inc. $ 22.5 $ 58.2 Mandatory convertible preferred stock dividend (8.8 ) (9.4 ) Gain on repurchase of preferred stock 7.3 4.6 Numerator for basic earnings per share attributable to Stericycle, Inc. common shareholders $ 21.0 $ 53.4 Denominator: Denominator for basic earnings per share - weighted average shares 85.5 85.2 Effect of dilutive securities: Stock-based compensation awards 0.3 0.4 Mandatory convertible preferred stock (1) - - Denominator for diluted earnings per share - adjusted weighted average shares and after assumed exercises 85.8 85.6 Earnings per share – Basic $ 0.25 $ 0.63 Earnings per share – Diluted $ 0.25 $ 0.62 (1) For the three months ended March 31, 2018 and 2017, the weighted average common shares (in thousands) issuable upon the assumed conversion of the mandatory convertible preferred stock totaling 4,903, and 5,264, respectively, were excluded from the computation of diluted earnings per share as such conversion would have been anti-dilutive. |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Financial Information Concerning Company's Reportable Segments | Beginning in the first quarter of 2018, we have changed our measure of segment profitability to Adjusted Earnings Before Interest, Tax, Depreciation and Amortization (“Adjusted EBITDA”). Adjusted EBITDA is Income from operations excluding certain specified items, Depreciation and Intangible Amortization. As a result of this change in segment reporting, all applicable historical segment information has been revised to conform to the new presentation. The following tables show financial information for the Company's reportable segments: In millions Three Months Ended March 31, 2018 2017 Revenues Domestic and Canada RCS $ 638.5 $ 633.7 International RCS 180.3 181.6 All Other 76.2 77.1 Total $ 895.0 $ 892.4 Gross Profit Domestic and Canada RCS $ 260.5 $ 278.1 International RCS 62.8 58.5 All other 35.2 32.1 Total $ 358.5 $ 368.7 Depreciation Domestic and Canada RCS $ 17.9 $ 17.2 International RCS 7.3 7.8 All Other 5.6 4.1 Total $ 30.8 $ 29.1 Intangible Amortization Domestic and Canada RCS $ 23.2 $ 21.7 International RCS 6.6 5.4 All Other 2.1 2.0 Total $ 31.9 $ 29.1 Adjusted EBITDA Domestic and Canada RCS $ 190.0 $ 203.7 International RCS 33.0 27.9 All Other (33.7 ) (32.1 ) Total $ 189.3 $ 199.5 |
Reconciliation of Company's Primary Measure of Segment Profitability (EBITDA) to Income from Operations | The following table reconciles the Company's primary measure of segment profitability (Adjusted EBITDA) to Income from operations: In millions Three Months Ended March 31, 2018 2017 Domestic and Canada RCS Adjusted EBITDA $ 190.0 $ 203.7 International RCS Adjusted EBITDA 33.0 27.9 All Other Adjusted EBITDA (33.7 ) (32.1 ) Depreciation (30.8 ) (29.1 ) Business Transformation (22.1 ) - Intangible Amortization (31.9 ) (29.1 ) Acquisition and Integration (4.1 ) (11.5 ) Operational Optimization (8.9 ) (10.9 ) Divestitures (4.1 ) - Litigation, Settlements and Regulatory Compliance (27.5 ) (1.9 ) Other (5.8 ) (2.5 ) Income from operations $ 54.1 $ 114.5 |
Summary of Revenues Details by Service Line | The following table presents consolidated revenues by service: In millions Three Months Ended March 31, 2018 2017 Regulated Waste and Compliance Services $ 497.4 $ 511.2 Secure Information Destruction Services 219.9 204.1 Communication and Related Services 91.9 93.5 Manufacturing and Industrial Services 85.8 83.6 Revenues $ 895.0 $ 892.4 |
BASIS OF PRESENTATION AND SUM34
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Detail) $ in Millions | 3 Months Ended | |
Mar. 31, 2018USD ($)Customer | Mar. 31, 2017USD ($) | |
Significant Accounting Policies [Line Items] | ||
Deferred installation costs | $ 1.6 | |
Selling, general and administrative expenses | 304.4 | $ 254.2 |
ASC 606 | ||
Significant Accounting Policies [Line Items] | ||
Net increase to retained earnings | 13 | |
ASC 606 | Difference between Revenue Guidance in Effect before and after Topic 606 | ||
Significant Accounting Policies [Line Items] | ||
Capitalization of contract acquisition costs | 23.3 | |
Deferred installation costs | 4.9 | |
Deferred income taxes liabilities | 5.4 | |
Selling, general and administrative expenses | $ 3.6 | |
Minimum | ||
Significant Accounting Policies [Line Items] | ||
Number of customers | Customer | 1,000,000 |
REVENUE FROM CONTRACTS WITH C35
REVENUE FROM CONTRACTS WITH CUSTOMERS - Schedule of Revenues Disaggregated by Service, Primary Geographical Regions and Timing of Revenue Recognition (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Disaggregation Of Revenue [Line Items] | |
Revenues | $ 895 |
Domestic and Canada RCS | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 599.4 |
Domestic and Canada RCS | Canada | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 39.1 |
International RCS | Europe | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 112.5 |
International RCS | Others | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 67.8 |
Other | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 76.2 |
Medical Waste and Compliance Solutions | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 419.9 |
Medical Waste and Compliance Solutions | Domestic and Canada RCS | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 292.8 |
Medical Waste and Compliance Solutions | Domestic and Canada RCS | Canada | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 9.8 |
Medical Waste and Compliance Solutions | International RCS | Europe | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 65.3 |
Medical Waste and Compliance Solutions | International RCS | Others | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 52 |
Hazardous Waste Solutions | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 77.5 |
Hazardous Waste Solutions | Domestic and Canada RCS | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 77.5 |
Manufacturing and Industrial Services | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 85.8 |
Manufacturing and Industrial Services | Domestic and Canada RCS | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 58.8 |
Manufacturing and Industrial Services | Domestic and Canada RCS | Canada | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 5.5 |
Manufacturing and Industrial Services | International RCS | Europe | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 8.7 |
Manufacturing and Industrial Services | International RCS | Others | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 12.8 |
Secure Information Destruction Services | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 219.9 |
Secure Information Destruction Services | Domestic and Canada RCS | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 170.3 |
Secure Information Destruction Services | Domestic and Canada RCS | Canada | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 16.2 |
Secure Information Destruction Services | International RCS | Europe | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 30.4 |
Secure Information Destruction Services | International RCS | Others | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 3 |
Communication Services | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 49.5 |
Communication Services | Domestic and Canada RCS | Canada | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 4.5 |
Communication Services | International RCS | Europe | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 5.3 |
Communication Services | Other | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 39.7 |
Expert Solutions | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 42.4 |
Expert Solutions | Domestic and Canada RCS | Canada | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 3.1 |
Expert Solutions | International RCS | Europe | |
Disaggregation Of Revenue [Line Items] | |
Revenues | 2.8 |
Expert Solutions | Other | United States | |
Disaggregation Of Revenue [Line Items] | |
Revenues | $ 36.5 |
REVENUE FROM CONTRACTS WITH C36
REVENUE FROM CONTRACTS WITH CUSTOMERS - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Disaggregation Of Revenue [Line Items] | |
Contract liability | $ 18.1 |
Amortized sales incentive cost | 1.6 |
Other Current Assets | |
Disaggregation Of Revenue [Line Items] | |
Capitalization of contract acquisition costs | 6.5 |
Other Noncurrent Assets | |
Disaggregation Of Revenue [Line Items] | |
Capitalization of contract acquisition costs | $ 21.4 |
Minimum | |
Disaggregation Of Revenue [Line Items] | |
Estimated period of benefit to be received | 6 years 2 months 12 days |
ACQUISITIONS - Additional Infor
ACQUISITIONS - Additional Information (Detail) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018USD ($)Entity | Dec. 31, 2017USD ($) | |
Business Acquisition [Line Items] | ||
Number of acquisitions | Entity | 9 | |
Net increase (decrease) in goodwill | $ 17.9 | $ 46.5 |
Customer relationships | ||
Business Acquisition [Line Items] | ||
Acquired finite-lived intangible assets | $ 9 | |
Customer relationships | Minimum | ||
Business Acquisition [Line Items] | ||
Acquired finite-lived intangible assets, useful life | 10 years | |
Customer relationships | Maximum | ||
Business Acquisition [Line Items] | ||
Acquired finite-lived intangible assets, useful life | 30 years |
ACQUISITIONS - Summary of Acqui
ACQUISITIONS - Summary of Acquisitions Location, Services and Type (Detail) | 3 Months Ended |
Mar. 31, 2018Entity | |
Business Acquisition [Line Items] | |
Number of acquisitions | 9 |
Regulated Waste | |
Business Acquisition [Line Items] | |
Number of acquisitions | 1 |
Secure Information Destruction | |
Business Acquisition [Line Items] | |
Number of acquisitions | 8 |
United States | |
Business Acquisition [Line Items] | |
Number of acquisitions | 9 |
United States | Regulated Waste | |
Business Acquisition [Line Items] | |
Number of acquisitions | 1 |
United States | Secure Information Destruction | |
Business Acquisition [Line Items] | |
Number of acquisitions | 8 |
ACQUISITIONS - Aggregate Purcha
ACQUISITIONS - Aggregate Purchase Price Paid for Acquisitions and Other Adjustments to Consideration (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Business Acquisition [Line Items] | ||
Cash | $ 15.9 | $ 16.9 |
Series of individual business acquisitions | ||
Business Acquisition [Line Items] | ||
Cash | 15.9 | |
Promissory notes | 11.6 | |
Contingent consideration | (0.4) | |
Total purchase price | 27.1 | |
Series of individual business acquisitions | Current Period Acquisitions | ||
Business Acquisition [Line Items] | ||
Cash | 15.9 | |
Promissory notes | 11.6 | |
Total purchase price | 27.5 | |
Series of individual business acquisitions | Restatement adjustment | ||
Business Acquisition [Line Items] | ||
Contingent consideration | (0.4) | |
Total purchase price | $ (0.4) |
ACQUISITIONS - Purchase Price A
ACQUISITIONS - Purchase Price Allocation (Detail) $ in Millions | Mar. 31, 2018USD ($) |
Business Acquisition [Line Items] | |
Fixed assets | $ 5.3 |
Intangibles | 9.6 |
Goodwill | 11.5 |
Net other assets and liabilities | 0.7 |
Total purchase price allocation | 27.1 |
Current Period Acquisitions | |
Business Acquisition [Line Items] | |
Fixed assets | 0.2 |
Intangibles | 9 |
Goodwill | 17.9 |
Net other assets and liabilities | 0.4 |
Total purchase price allocation | 27.5 |
Restatement adjustment | |
Business Acquisition [Line Items] | |
Fixed assets | 5.1 |
Intangibles | 0.6 |
Goodwill | (6.4) |
Net other assets and liabilities | 0.3 |
Total purchase price allocation | $ (0.4) |
RESTRUCTURING, DIVESTITURES, 41
RESTRUCTURING, DIVESTITURES, AND ASSETS HELD FOR SALE - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Restructuring Cost And Reserve [Line Items] | ||
Restructuring charges | $ 13.9 | |
Employee termination | 11.5 | |
Non-cash impairment charges | 2.4 | |
Payments for restructuring liability | $ 2.2 | |
Assets and Liabilities Held for Sale, Not Discontinued Operations | Selling, General and Administrative Expenses | ||
Restructuring Cost And Reserve [Line Items] | ||
Non-cash impairment charges | 4.1 | |
Domestic And Canada Regulated Waste And Compliance Services | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring charges | 5.5 | |
International Regulated Waste And Compliance Services | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring charges | 3.3 | |
Other | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring charges | $ 5.1 | |
Employee Termination Charges | ||
Restructuring Cost And Reserve [Line Items] | ||
Employee termination restructuring charges anticipated | 20 | |
Employee Termination Charges | Domestic And Canada Regulated Waste And Compliance Services | ||
Restructuring Cost And Reserve [Line Items] | ||
Employee termination restructuring charges anticipated | 8 | |
Employee Termination Charges | International Regulated Waste And Compliance Services | ||
Restructuring Cost And Reserve [Line Items] | ||
Employee termination restructuring charges anticipated | 1 | |
Employee Termination Charges | Other | ||
Restructuring Cost And Reserve [Line Items] | ||
Employee termination restructuring charges anticipated | $ 11 |
RESTRUCTURING, DIVESTITURES, 42
RESTRUCTURING, DIVESTITURES, AND ASSETS HELD FOR SALE - Summary of Major Classes of Assets and Liabilities Classified as Held for Sale (Detail) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||
Total current assets | $ 17.7 | $ 20.8 |
Total current liabilities | 5.1 | 5.1 |
Assets and Liabilities Held for Sale, Not Discontinued Operations | ||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||
Total current assets | 8.1 | 7.7 |
Fixed assets | 8.8 | 8.5 |
Goodwill | 1.6 | |
Intangibles | 0.8 | 2.6 |
Other assets | 0.4 | |
Assets held for sale | 17.7 | 20.8 |
Total current liabilities | 5.1 | 4.7 |
Deferred income taxes | 0.4 | |
Liabilities held for sale | $ 5.1 | $ 5.1 |
GOODWILL AND OTHER INTANGIBLE43
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Goodwill [Roll Forward] | ||
Beginning Balance | $ 3,604 | $ 3,591 |
Goodwill acquired during year | 17.9 | 46.5 |
Purchase accounting adjustments | (6.4) | (7.4) |
Impairments during the year | (65) | |
Write-offs related to disposition and assets held for sale | (7.1) | |
Changes due to foreign currency fluctuations | 9.7 | 46 |
Ending Balance | 3,625.2 | 3,604 |
Domestic and Canada RCS | ||
Goodwill [Roll Forward] | ||
Beginning Balance | 2,850.2 | 2,811.8 |
Goodwill acquired during year | 17.9 | 36.9 |
Purchase accounting adjustments | (5.4) | (10.1) |
Impairments during the year | 0 | |
Write-offs related to disposition and assets held for sale | 0 | |
Changes due to foreign currency fluctuations | (3.9) | 11.6 |
Ending Balance | 2,858.8 | 2,850.2 |
International Regulated Waste And Compliance Services | ||
Goodwill [Roll Forward] | ||
Beginning Balance | 466.8 | 498.4 |
Goodwill acquired during year | 0 | 4.9 |
Purchase accounting adjustments | (0.2) | 1.2 |
Impairments during the year | (65) | |
Write-offs related to disposition and assets held for sale | (7.1) | |
Changes due to foreign currency fluctuations | 13.6 | 34.4 |
Ending Balance | 480.2 | 466.8 |
All Other | ||
Goodwill [Roll Forward] | ||
Beginning Balance | 287 | 280.8 |
Goodwill acquired during year | 0 | 4.7 |
Purchase accounting adjustments | (0.8) | 1.5 |
Impairments during the year | 0 | |
Write-offs related to disposition and assets held for sale | 0 | |
Changes due to foreign currency fluctuations | 0 | 0 |
Ending Balance | $ 286.2 | $ 287 |
GOODWILL AND OTHER INTANGIBLE44
GOODWILL AND OTHER INTANGIBLE ASSETS - Carrying Values of Other Intangible Assets (Detail) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | $ 2,195.9 | $ 2,184 | |
Accumulated Amortization | 424.7 | 392.5 | |
Net Value | 1,771.2 | 1,791.5 | $ 1,862 |
Operating permits | |||
Intangible Assets By Major Class [Line Items] | |||
Carrying Amount, Indefinite Lived Intangible Assets | 222.3 | 222.3 | |
Tradenames | |||
Intangible Assets By Major Class [Line Items] | |||
Carrying Amount, Indefinite Lived Intangible Assets | 318.2 | 317.4 | |
Customer relationships | |||
Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 1,625.4 | 1,613.4 | |
Accumulated Amortization | 413 | 381.4 | |
Net Value | 1,212.4 | 1,232 | |
Covenants not-to-compete | |||
Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 7.9 | 7.9 | |
Accumulated Amortization | 6.2 | 5.9 | |
Net Value | 1.7 | 2 | |
Tradenames | |||
Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 6 | 6 | |
Accumulated Amortization | 2 | 1.8 | |
Net Value | 4 | 4.2 | |
Other | |||
Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 16.1 | 17 | |
Accumulated Amortization | 3.5 | 3.4 | |
Net Value | $ 12.6 | $ 13.6 |
GOODWILL AND OTHER INTANGIBLE45
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amount of Intangible Assets (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Finite-lived and Indefinite-lived Intangible Assets [Roll Forward] | |||
Beginning of period | $ 1,791.5 | $ 1,862 | $ 1,862 |
Intangible assets acquired during the year | 9 | 28.2 | |
Valuation adjustments for prior year acquisitions | 0.6 | 7.9 | |
Write-offs due to disposition and amounts reclassified to assets held for sale | (2.6) | ||
Impairments during the year | (4.2) | (21) | |
Amortization during the year | (31.9) | $ (29.1) | (118.4) |
Changes due to foreign currency fluctuations | 6.2 | 35.4 | |
End of period | $ 1,771.2 | $ 1,791.5 |
GOODWILL AND OTHER INTANGIBLE46
GOODWILL AND OTHER INTANGIBLE ASSETS - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Intangible Assets By Major Class [Line Items] | |||
Aggregate intangible asset amortization expense | $ 31.9 | $ 29.1 | $ 118.4 |
Customer relationships | |||
Intangible Assets By Major Class [Line Items] | |||
Definite-lived assets impairment charges | $ 3 | ||
Finite-lived intangible assets, weighted average remaining useful life | 11 years 8 months 12 days | ||
Customer relationships | Minimum | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, useful life | 10 years | ||
Customer relationships | Maximum | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, useful life | 30 years | ||
Covenants not-to-compete | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, weighted average remaining useful life | 2 years 7 months 6 days | ||
Covenants not-to-compete | Minimum | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, useful life | 5 years | ||
Covenants not-to-compete | Maximum | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, useful life | 14 years | ||
Tradenames | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, weighted average remaining useful life | 15 years 3 months 18 days | ||
Tradenames | Minimum | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, useful life | 4 years | ||
Tradenames | Maximum | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, useful life | 40 years | ||
Other intangibles | |||
Intangible Assets By Major Class [Line Items] | |||
Finite-lived intangible assets, weighted average remaining useful life | 16 years 6 months | ||
Operating permits | |||
Intangible Assets By Major Class [Line Items] | |||
Indefinite-lived assets impairment charges | $ 1.2 |
GOODWILL AND OTHER INTANGIBLE47
GOODWILL AND OTHER INTANGIBLE ASSETS - Estimated Amortization Expense (Detail) $ in Millions | Dec. 31, 2017USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
2,018 | $ 127.9 |
2,019 | 127.8 |
2,020 | 127 |
2,021 | 126.6 |
2,022 | $ 126.2 |
DEBT - Schedule of Long-Term De
DEBT - Schedule of Long-Term Debt (Detail) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Total debt | $ 2,720 | $ 2,747.2 |
Less: current portion of total debt | 121.9 | 119.5 |
Less: unamortized debt issuance costs | 11.9 | 12.4 |
Long-term portion of total debt | 2,586.2 | 2,615.3 |
Obligations under capital leases | ||
Debt Instrument [Line Items] | ||
Total debt | 19.3 | 9.4 |
$1.2 billion senior credit facility weighted average rate 2.74% in 2018 and 2.55% in 2017, due in 2022 | ||
Debt Instrument [Line Items] | ||
Total debt | 446.9 | 471.7 |
$950 million term loan weighted average rate 3.20% in 2018 and 2.83% in 2017, due in 2022 | ||
Debt Instrument [Line Items] | ||
Total debt | 938.1 | 950 |
$125 million private placement notes 2.68%, due in 2019 | ||
Debt Instrument [Line Items] | ||
Total debt | 125 | 125 |
$225 million private placement notes 4.47%, due in 2020 | ||
Debt Instrument [Line Items] | ||
Total debt | 225 | 225 |
$150 million private placement notes 2.89%, due in 2021 | ||
Debt Instrument [Line Items] | ||
Total debt | 150 | 150 |
$125 million private placement notes 3.26%, due in 2022 | ||
Debt Instrument [Line Items] | ||
Total debt | 125 | 125 |
$200 million private placement notes 2.72%, due in 2022 | ||
Debt Instrument [Line Items] | ||
Total debt | 200 | 200 |
$100 million private placement notes 2.79%, due in 2023 | ||
Debt Instrument [Line Items] | ||
Total debt | 100 | 100 |
$150 million private placement notes 3.18%, due in 2023 | ||
Debt Instrument [Line Items] | ||
Total debt | 150 | 150 |
Promissory notes and deferred consideration weighted average rate 1.59% in 2018 and 1.49% in 2017 and weighted average maturity 2.9 years in 2018 and 2017 | ||
Debt Instrument [Line Items] | ||
Total debt | 153 | 155.9 |
Foreign bank debt weighted average rate 5.38% in 2018 and 6.11% in 2017 and weighted average maturity 1.5 years in 2018 and 1.7 years in 2017 | ||
Debt Instrument [Line Items] | ||
Total debt | $ 87.7 | $ 85.2 |
DEBT - Schedule of Long-Term 49
DEBT - Schedule of Long-Term Debt (Parenthetical) (Detail) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
$1.2 billion senior credit facility weighted average rate 2.74% in 2018 and 2.55% in 2017, due in 2022 | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity of line of credit facility | $ 1,200,000,000 | |
Long-term debt, weighted average interest rate | 2.74% | 2.55% |
$950 million term loan weighted average rate 3.20% in 2018 and 2.83% in 2017, due in 2022 | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity of line of credit facility | $ 950,000,000 | |
Stated interest rate | 3.20% | 2.83% |
$125 million private placement notes 2.68%, due in 2019 | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 2.68% | |
Long-term debt, face amount | $ 125,000,000 | |
$225 million private placement notes 4.47%, due in 2020 | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 4.47% | |
Long-term debt, face amount | $ 225,000,000 | |
$150 million private placement notes 2.89%, due in 2021 | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 2.89% | |
Long-term debt, face amount | $ 150,000,000 | |
$125 million private placement notes 3.26%, due in 2022 | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 3.26% | |
Long-term debt, face amount | $ 125,000,000 | |
$200 million private placement notes 2.72%, due in 2022 | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 2.72% | |
Long-term debt, face amount | $ 200,000,000 | |
$100 million private placement notes 2.79%, due in 2023 | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 2.79% | |
Long-term debt, face amount | $ 100,000,000 | |
$150 million private placement notes 3.18%, due in 2023 | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 3.18% | |
Long-term debt, face amount | $ 150,000,000 | |
Promissory notes and deferred consideration weighted average rate 1.59% in 2018 and 1.49% in 2017 and weighted average maturity 2.9 years in 2018 and 2017 | ||
Debt Instrument [Line Items] | ||
Long-term debt, weighted average interest rate | 1.59% | 1.49% |
Long-term debt, maturity | 2 years 10 months 24 days | 2 years 10 months 24 days |
Foreign bank debt weighted average rate 5.38% in 2018 and 6.11% in 2017 and weighted average maturity 1.5 years in 2018 and 1.7 years in 2017 | ||
Debt Instrument [Line Items] | ||
Long-term debt, weighted average interest rate | 5.38% | 6.11% |
Long-term debt, maturity | 1 year 6 months | 1 year 8 months 12 days |
DEBT - Additional Information (
DEBT - Additional Information (Detail) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Minimum consolidated leverage ratio to trigger increase in interest rate | 375.00% | |
Maximum consolidated leverage ratio possible on Settlement | 400.00% | |
Consolidated leverage ratio, current | 350.00% | |
Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Minimum consolidated leverage ratio to trigger increase in interest rate | 375.00% | |
Allowable increment in interest rate on consolidated leverage ratio exceeds 3.75 | 0.25% | |
Maximum | ||
Debt Instrument [Line Items] | ||
Allowed additions for business transformation, operational optimization and litigation matters for debt covenant compliance calculation | $ 200,000,000 | |
$1.20 billion senior credit facility weighted average rate 2.14%, due in 2019 | ||
Debt Instrument [Line Items] | ||
Revolving credit facility, amount committed to outstanding letters of credit | 118,300,000 | $ 130,800,000 |
Revolving credit facility, unused portion | $ 634,800,000 | $ 597,500,000 |
Senior credit facility | ||
Debt Instrument [Line Items] | ||
Minimum consolidated leverage ratio to trigger increase in interest rate | 375.00% | |
Allowable increment in interest rate on consolidated leverage ratio exceeds 3.75 | 0.25% | |
Private placement notes | BBB or better by S&P | ||
Debt Instrument [Line Items] | ||
Allowable increment in interest rate on consolidated leverage ratio exceeds 3.75 | 0.50% | |
Private placement notes | BBB- by S&P | ||
Debt Instrument [Line Items] | ||
Allowable increment in interest rate on consolidated leverage ratio exceeds 3.75 | 0.75% | |
Allowable increment in previous base interest rate on consolidated leverage ratio exceeds 3.75 | 0.25% | |
Private placement notes | BB+ or worse by S&P | ||
Debt Instrument [Line Items] | ||
Allowable increment in interest rate on consolidated leverage ratio exceeds 3.75 | 1.25% | |
Allowable increment in previous base interest rate on consolidated leverage ratio exceeds 3.75 | 0.50% |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Effective tax rate | 22.70% | 34.70% | |
Federal corporate tax rate | 21.00% | 35.00% |
FAIR VALUE MEASUREMENTS - Summa
FAIR VALUE MEASUREMENTS - Summary of Financial Assets and Liabilities Carried at Fair Value on Recurring Basis (Detail) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Assets: | ||
Derivative financial instruments | $ 0.5 | $ 0.4 |
Total assets | 0.5 | 0.4 |
Liabilities: | ||
Contingent consideration | 12.5 | 12.4 |
Total liabilities | 12.5 | 12.4 |
Level 2 Inputs [Member] | ||
Assets: | ||
Derivative financial instruments | 0.5 | 0.4 |
Total assets | 0.5 | 0.4 |
Level 3 Inputs [Member] | ||
Liabilities: | ||
Contingent consideration | 12.5 | 12.4 |
Total liabilities | $ 12.5 | $ 12.4 |
FAIR VALUE MEASUREMENTS - Addit
FAIR VALUE MEASUREMENTS - Additional Information (Detail) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Derivative asset | $ 500,000 | $ 400,000 |
Contingent consideration liabilities | 12,500,000 | 12,400,000 |
Debt obligations, carrying amount | 2,720,000,000 | 2,747,200,000 |
Maximum | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Maximum contingent liability if financial performance measures were fully met | 15,700,000 | |
Level 3 Inputs [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Contingent consideration liabilities | 12,500,000 | 12,400,000 |
Level 3 Inputs [Member] | Current Liabilities [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Contingent consideration liabilities | 4,700,000 | 4,600,000 |
Level 2 Inputs [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Derivative asset | 500,000 | 400,000 |
Debt obligations, fair value | $ 2,690,000,000 | $ 2,740,000,000 |
FAIR VALUE MEASUREMENTS - Chang
FAIR VALUE MEASUREMENTS - Changes to Contingent Consideration (Detail) - Contingent Consideration Liability - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Business Combination, Contingent Consideration, Liability [Roll Forward] | ||
Contingent consideration, Beginning Balance | $ 12.4 | $ 24.1 |
Increase due to current year acquisitions | 0.1 | |
Purchase accounting adjustments | (0.4) | (9.6) |
Decrease due to payments | (1.5) | |
Change in fair value reflected in Selling, general, and administrative expenses | 0.5 | (0.4) |
Other | (0.3) | |
Contingent consideration, Ending Balance | $ 12.5 | $ 12.4 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Loss Contingencies [Line Items] | |||
Environmental remediation liabilities | $ 30.8 | $ 30.8 | |
Environmental remediation liabilities, projection term | 30 years | ||
Hazardous waste facility in Mexico | |||
Loss Contingencies [Line Items] | |||
Environmental remediation liabilities | $ 2 | ||
Accrued Liabilities [Member] | |||
Loss Contingencies [Line Items] | |||
Environmental remediation liabilities | $ 6.2 | $ 5.7 |
STOCK BASED COMPENSATION - Stoc
STOCK BASED COMPENSATION - Stock-Based Compensation Expense Resulting from Stock Option Awards, RSUs, PSUs and ESPP (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 7.1 | $ 6 |
Stock Options | Selling, General and Administrative Expenses | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | 3 | 4.1 |
Restricted Stock Units (RSUs) | Selling, General and Administrative Expenses | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | 2.1 | 1.4 |
Performance-Based Restricted Stock Units | Selling, General and Administrative Expenses | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | 1.6 | 0.2 |
Employee Stock Purchase Plan | Selling, General and Administrative Expenses | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 0.4 | $ 0.3 |
STOCK BASED COMPENSATION - Addi
STOCK BASED COMPENSATION - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Intrinsic value of options exercised | $ 0.6 | $ 2.9 |
Stock Options | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unrecognized compensation expenses related to stock options | $ 29.3 | |
Weighted average period of recognition for unrecognized compensation expenses | 3 years 2 months 8 days | |
Stock Options | Director | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Award vesting period | 1 year | |
Stock Options | Officers And Employees | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Award vesting period | 5 years | |
Restricted Stock Units (RSUs) | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Award vesting period | 5 years | |
Weighted average period of recognition for unrecognized compensation expenses | 4 years 2 months 12 days | |
Unrecognized compensation expenses related to RSUs | $ 30.1 | |
Fair value of units vested (in shares) | 3.5 | |
Performance-Based Restricted Stock Units | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unrecognized compensation expenses related to RSUs | $ 5.5 |
STOCK BASED COMPENSATION - St58
STOCK BASED COMPENSATION - Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Number of Options | ||
Outstanding at beginning of year | 5,393,417 | |
Granted | 338,834 | 425,599 |
Exercised | (38,203) | |
Forfeited | (71,348) | |
Canceled or expired | (101,631) | |
Outstanding as of March 31, 2018 | 5,521,069 | |
Exercisable as of March 31, 2018 | 3,951,661 | |
Weighted Average Exercise Price per Share | ||
Outstanding at beginning of year | $ 96.91 | |
Granted | 62.13 | |
Exercised | 53.63 | |
Forfeited | 109.61 | |
Canceled or expired | 102.66 | |
Outstanding as of March 31, 2018 | 94.81 | |
Exercisable as of March 31, 2018 | $ 93.48 | |
Weighted Average Remaining Contractual Life | ||
Outstanding as of March 31, 2018 | 4 years 6 months 14 days | |
Exercisable as of March 31, 2018 | 3 years 10 months 13 days | |
Total Aggregate Intrinsic Value | ||
Outstanding as of March 31, 2018 | $ 5.5 | |
Exercisable as of March 31, 2018 | $ 5.5 |
STOCK BASED COMPENSATION - Assu
STOCK BASED COMPENSATION - Assumptions Used in Black-Scholes Option Pricing Model (Detail) - $ / shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Stock options granted (shares) | 338,834 | 425,599 |
Weighted average fair value at grant date | $ 16.87 | $ 19.53 |
Expected term (in years) | 4 years 10 months 20 days | 4 years 9 months 25 days |
Expected volatility | 25.33% | 22.66% |
Expected dividend yield | 0.00% | 0.00% |
Risk free interest rate | 2.57% | 1.91% |
STOCK BASED COMPENSATION - Summ
STOCK BASED COMPENSATION - Summary of RSU Activity (Detail) - Restricted Stock Units (RSUs) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($)$ / sharesshares | |
Number of Units | |
Non-vested at January 1, 2018 | shares | 267,297 |
Granted | shares | 247,570 |
Vested and Released | shares | (51,302) |
Forfeited | shares | (10,395) |
Non-vested as of March 31, 2018 | shares | 453,170 |
Weighted Average Grant Date Fair Value Per Share | |
Non-vested at January 1, 2018 | $ / shares | $ 89.74 |
Granted | $ / shares | 62.14 |
Vested and Released | $ / shares | 89.31 |
Forfeited | $ / shares | 90.32 |
Non-vested as of March 31, 2018 | $ / shares | $ 74.43 |
Weighted Average Remaining Contractual Life | |
Non-vested as of March 31, 2018 | 2 years 6 months 10 days |
Total Aggregate Intrinsic Value | |
Non-vested as of March 31, 2018 | $ | $ 26.5 |
STOCK BASED COMPENSATION - Su61
STOCK BASED COMPENSATION - Summary of PSU Activity (Detail) - Performance-Based Restricted Stock Units $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($)$ / sharesshares | |
Number of Units | |
Non-vested at January 1, 2018 | shares | 33,447 |
Granted | shares | 399,658 |
Forfeited | shares | (12,880) |
Non-vested as of March 31, 2018 | shares | 420,225 |
Weighted Average Grant Date Fair Value Per Share | |
Non-vested at January 1, 2018 | $ / shares | $ 82.85 |
Granted | $ / shares | 62.09 |
Forfeited | $ / shares | 82.92 |
Non-vested as of March 31, 2018 | $ / shares | $ 63.11 |
Weighted Average Remaining Contractual Life | |
Non-vested as of March 31, 2018 | 2 years 3 months 26 days |
Total Aggregate Intrinsic Value | |
Non-vested as of March 31, 2018 | $ | $ 24.6 |
PREFERRED STOCK - Additional In
PREFERRED STOCK - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | ||
Feb. 28, 2018 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Equity [Abstract] | ||||
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 | ||
Preferred stock, issued (in shares) | 658,190 | 700,000 | ||
Preferred stock, outstanding (in shares) | 658,190 | 700,000 | ||
Dividends paid on mandatory convertible preferred stock | $ 8.8 | $ 9.4 | ||
Increase to retained earnings on repurchase of mandatory convertible preferred stock | $ 7.3 | $ 4.6 | ||
Depositary shares repurchased during period (in shares) | 151,900 | 151,900 | ||
Depository shares equivalent to preferred stock units (in shares) | 15,190 |
PREFERRED STOCK - Repurchases o
PREFERRED STOCK - Repurchases of Depository Shares of Mandatory Convertible Preferred Stock (Detail) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended |
Feb. 28, 2018 | Mar. 31, 2018 | |
Equity [Abstract] | ||
Number of Depository Shares Repurchased | 151,900 | 151,900 |
Amount Paid for Repurchases | $ 7.4 | $ 7.4 |
Average Price Paid per Share | $ 49.05 | $ 49.05 |
EARNINGS PER COMMON SHARE - Com
EARNINGS PER COMMON SHARE - Computation of Basic and Diluted Net Income Per Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Numerator: | ||
Net income attributable to Stericycle, Inc. | $ 22.5 | $ 58.2 |
Mandatory convertible preferred stock dividend | (8.8) | (9.4) |
Gain on repurchase of preferred stock | 7.3 | 4.6 |
Net income attributable to Stericycle, Inc. common shareholders | $ 21 | $ 53.4 |
Denominator: | ||
Denominator for basic earnings per share-weighted average shares (in shares) | 85.5 | 85.2 |
Effect of dilutive securities: | ||
Stock-based compensation awards | 0.3 | 0.4 |
Mandatory convertible preferred stock (in shares) | 0 | 0 |
Denominator for diluted earnings per share-adjusted weighted average shares and after assumed exercises (in shares) | 85.8 | 85.6 |
Earnings per share - Basic (in dollars per share) | $ 0.25 | $ 0.63 |
Earnings per share - Diluted (in dollars per share) | $ 0.25 | $ 0.62 |
EARNINGS PER COMMON SHARE - C65
EARNINGS PER COMMON SHARE - Computation of Basic and Diluted Net Income Per Share (Parenthetical) (Detail) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Mandatory Convertible Preferred Stock | ||
Antidilutive shares excluded from computation of diluted earnings per share | ||
Antidilutive shares excluded from computation of diluted earnings per share (in shares) | 4,903 | 5,264 |
EARNINGS PER COMMON SHARE - Add
EARNINGS PER COMMON SHARE - Additional Information (Detail) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Stock Options | ||
Antidilutive shares excluded from computation of diluted earnings per share | ||
Shares excluded from computation of diluted earnings per share | 4,700 | 4,660 |
Restricted Stock Units (RSUs) | ||
Antidilutive shares excluded from computation of diluted earnings per share | ||
Shares excluded from computation of diluted earnings per share | 51 | 135 |
SEGMENT REPORTING - Financial I
SEGMENT REPORTING - Financial Information Concerning Company's Reportable Segments (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 895 | $ 892.4 | |
Gross Profit | 358.5 | 368.7 | |
Depreciation | 30.8 | 29.1 | |
Intangible amortization | 31.9 | 29.1 | $ 118.4 |
Adjusted EBITDA | 189.3 | 199.5 | |
Domestic And Canada Regulated Waste And Compliance Services | |||
Segment Reporting Information [Line Items] | |||
Revenues | 638.5 | 633.7 | |
Gross Profit | 260.5 | 278.1 | |
Depreciation | 17.9 | 17.2 | |
Intangible amortization | 23.2 | 21.7 | |
Adjusted EBITDA | 190 | 203.7 | |
International Regulated Waste And Compliance Services | |||
Segment Reporting Information [Line Items] | |||
Revenues | 180.3 | 181.6 | |
Gross Profit | 62.8 | 58.5 | |
Depreciation | 7.3 | 7.8 | |
Intangible amortization | 6.6 | 5.4 | |
Adjusted EBITDA | 33 | 27.9 | |
Other | |||
Segment Reporting Information [Line Items] | |||
Revenues | 76.2 | 77.1 | |
Gross Profit | 35.2 | 32.1 | |
Depreciation | 5.6 | 4.1 | |
Intangible amortization | 2.1 | 2 | |
Adjusted EBITDA | $ (33.7) | $ (32.1) |
SEGMENT REPORTING - Reconciliat
SEGMENT REPORTING - Reconciliation of Company's Primary Measure of Segment Profitability (EBITDA) to Income from Operations (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Segment Reporting Reconciling Item For Operating Profit Loss From Segment To Consolidated [Line Items] | |||
Adjusted EBITDA | $ 189.3 | $ 199.5 | |
Depreciation | (30.8) | (29.1) | |
Business Transformation | (22.1) | ||
Intangible Amortization | (31.9) | (29.1) | $ (118.4) |
Acquisition and Integration | (4.1) | (11.5) | |
Operational Optimization | (8.9) | (10.9) | |
Divestitures | (4.1) | ||
Litigation, Settlements and Regulatory Compliance | (27.5) | (1.9) | |
Other | (5.8) | (2.5) | |
Income from operations | 54.1 | 114.5 | |
Domestic And Canada Regulated Waste And Compliance Services | |||
Segment Reporting Reconciling Item For Operating Profit Loss From Segment To Consolidated [Line Items] | |||
Adjusted EBITDA | 190 | 203.7 | |
Depreciation | (17.9) | (17.2) | |
Intangible Amortization | (23.2) | (21.7) | |
International Regulated Waste And Compliance Services | |||
Segment Reporting Reconciling Item For Operating Profit Loss From Segment To Consolidated [Line Items] | |||
Adjusted EBITDA | 33 | 27.9 | |
Depreciation | (7.3) | (7.8) | |
Intangible Amortization | (6.6) | (5.4) | |
All Other | |||
Segment Reporting Reconciling Item For Operating Profit Loss From Segment To Consolidated [Line Items] | |||
Adjusted EBITDA | (33.7) | (32.1) | |
Depreciation | (5.6) | (4.1) | |
Intangible Amortization | $ (2.1) | $ (2) |
SEGMENT REPORTING - Summary of
SEGMENT REPORTING - Summary of Revenues Details by Service Line (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Entity Wide Information Revenue From External Customer [Line Items] | ||
Revenues | $ 895 | $ 892.4 |
Regulated Waste And Compliance Services | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Revenues | 497.4 | 511.2 |
Secure Information Destruction | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Revenues | 219.9 | 204.1 |
Communication And Related Services | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Revenues | 91.9 | 93.5 |
Manufacturing and Industrial Services | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Revenues | $ 85.8 | $ 83.6 |
LEGAL PROCEEDINGS - Additional
LEGAL PROCEEDINGS - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended |
Jul. 31, 2017 | Jun. 30, 2017 | |
Hazardous waste facility in Mexico | ||
Loss Contingencies [Line Items] | ||
Environmental remediation costs | $ 2 | |
Proposed MDL settlement | ||
Loss Contingencies [Line Items] | ||
Litigation settlement amount, common fund established | $ 295 | |
Litigation expenses | $ 295 |