Exhibit 99.1
FOR IMMEDIATE RELEASE
MOBILE MINI REPORTS Q4’15 RESULTS AND ANNOUNCES 10% INCREASE IN QUARTERLY DIVIDEND
Phoenix, AZ – February 5, 2016 – Mobile Mini, Inc. (NASDAQ GS: MINI) (the “Company” or “Mobile Mini”), the world’s leading supplier of portable storage solutions and a leading provider of specialty containment solutions in the United States, today reported actual and adjusted financial results for the quarter ended December 31, 2015. Total revenues were $134.5 million and rental revenues were $126.5 million, up from $123.2 million and $113.4 million, respectively, for the same period last year.
The Company recorded net income of $9.5 million, or $0.21 per diluted share in the fourth quarter of 2015 as compared to net income of $12.9 million, or $0.28 per diluted share, for the fourth quarter of 2014. On an adjusted basis, fourth quarter net income was $18.4 million, or $0.41 per diluted share, compared to adjusted net income of $17.0 million, or $0.37 per diluted share, for the fourth quarter of 2014. During the fourth quarter, the Company recognized $16.0 million of restructuring expense related primarily to the integration and geographic expansion of ETS into the existing Mobile Mini footprint. The charges largely consist of non-cash fleet and property, plant and equipment abandonment costs. Adjusted EBITDA was $54.9 million and adjusted EBITDA margin was 40.9% for the fourth quarter of 2015.
Rental revenues for the portable storage and specialty containment businesses for the current quarter were $102.2 million and $24.3 million, respectively.
Dividend
The Company’s Board of Directors increased the Company’s first quarter 2016 cash dividend to 20.6 cents per share, a 10% increase as compared to the preceding period. The dividend will be paid on March 23, 2016 to shareholders of record on March 9, 2016.
Fourth Quarter 2015 Highlights
• | Increased portable storage rental revenues 5.2% year-over-year, excluding the wood mobile offices divested in May 2015, or 6.2% when adjusted for unfavorable currency fluctuations. |
• | Increased portable storage rental rates by 2.8% year-over-year. |
• | Expanded adjusted EBITDA margin to 40.9%, and delivered adjusted EBITDA of $54.9 million, up 12.0% from $49.0 million in the prior-year quarter. |
• | Increased average portable storage utilization to 74.0%, compared to 73.3% in the prior-year when excluding wood mobile offices. |
• | Delivered outstanding results in the U.K. with a 12.2% year-over-year increase in adjusted EBITDA to $8.8 million in the quarter, with a 40.0% margin. |
• | Accomplished a $1.0 billion refinancing of our ABL Credit Agreement, extending the maturity to December 2020 and reducing interest rate borrowing margins. |
• | Utilized strong free cash flow to return $14.4 million to our shareholders through $8.4 million in dividends and $6.0 million of repurchased treasury shares. |
Full Year 2015 Highlights
• | Executed on our strategy to focus on high-return, low-maintenance assets by divesting the wood mobile office business and successfully integrating the ETS acquisition. |
• | Achieved year-over-year portable storage rental rate increases of 4.5%. |
• | Grew adjusted diluted earnings per share by 21.1% to $1.32. |
Mobile Mini, Inc. News Release February 5, 2016 | Page 2 |
• | Generated $73.6 million in free cash flow while reinvesting in the business with $57.9 million in net fleet capital expenditures in targeted areas of high demand. |
• | Returned $95.5 million to our shareholders through $33.7 million in dividends and $61.8 million of repurchased treasury shares. |
CEO Comments
Erik Olsson, Mobile Mini’s President and Chief Executive Officer, remarked, “I am very pleased with our performance and profitability in the quarter, including our adjusted EBITDA margin of 40.9%, a 110 basis point expansion compared to the prior-year quarter, despite short-term pressure related to the wood mobile office divestiture. We continued to generate momentum in the fourth quarter, with North American core activations up 7% year-over-year, and portable storage year-end units on rent up 4.3% over last year-end. Within our total portable storage business, we drove a 2.8% year-over-year rate increase, which together with an increase in units on rent, resulted in a healthy 6.2% increase in rental revenues, when adjusted for unfavorable currency exchange rates.”
Mr. Olsson continued, “Demand in our construction, industrial and diversified sectors remains strong, and we are well-situated to capitalize on our existing Mobile Mini footprint to expand our downstream specialty containment market in 2016. Throughout the second half of 2015, we have gained traction and are well-positioned to leverage our investments for mid to high single-digit rental revenue growth in 2016.”
Conference Call
Mobile Mini will host a conference call today, Friday, February 5, 2016 at 12 noon ET to review these results. To listen to the call live, dial (201) 493-6739 and ask for the Mobile Mini Conference Call or go to www.mobilemini.com and click on the Investors section. Additionally, a slide presentation that will accompany the call will be posted atwww.mobilemini.com on the Investors section and will be available in advance and after the call. Please go to the website 15 minutes early to download and install any necessary audio software. If you are unable to listen live, a replay of the call can be accessed for approximately 14 days after the call at Mobile Mini’s website.
About Mobile Mini, Inc.
Mobile Mini, Inc. is the world’s leading provider of portable storage solutions through its total rental fleet of approximately 205,200 portable storage containers and office units. Through its wholly-owned subsidiary, Evergreen Tank Solutions, Mobile Mini is also a leading provider of specialty containment solutions in the U.S., with a rental fleet of approximately 11,700 units. Mobile Mini’s network includes 133 portable storage locations in the U.S., U.K., and Canada, 19 specialty containment locations and 7 combined locations. Mobile Mini is included on the Russell 2000® and 3000® Indexes and the S&P Small Cap Index.
Forward-Looking Statements
This news release contains forward-looking statements, including, but not limited to, our expectations regarding ongoing momentum in certain sectors, including our construction, industrial, and diversified sectors; our ability to leverage our footprint to expand our downstream specialty containment market in 2016; and our ability to leverage our investments for mid to high single-digit rental revenue growth in 2016, which involve risks and uncertainties that could cause actual results to differ materially from those currently anticipated. Risks and uncertainties that may affect future results include those that are described from time to time in the Company’s filings with the Securities and Exchange Commission (“SEC”). These forward-looking statements represent the judgment of the Company, as of the date of this release, and Mobile Mini disclaims any intent or obligation to update forward-looking statements.
Mobile Mini, Inc. News Release February 5, 2016 | Page 3 |
CONTACT: | -OR- | INVESTOR RELATIONS COUNSEL: | ||||
Mark Funk, Executive VP & Chief Financial Officer Mobile Mini, Inc. (602) 308-3879 www.mobilemini.com | The Equity Group Inc. Fred Buonocore (212) 836-9607 Linda Latman (212) 836-9609 |
(See accompanying tables)
Mobile Mini, Inc. News Release February 5, 2016 | Page 4 |
Reclassifications:
Certain amounts in the consolidated statements of operations for the three months ended March 31, 2015, which are included in the year-to-date period ended December 31, 2015, have been reclassified to conform to the current period presentation. The reclassifications have no effect on total revenues, income from operations, net income or net income per common share.
The Company believes the current presentation better reflects the nature of the underlying financial statement items.
Mobile Mini, Inc. News Release February 5, 2016 | Page 5 |
Mobile Mini, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
(in thousands, except per share data)
Three Months Ended December 31, 2015 | Three Months Ended December 31, 2014 | |||||||||||||||||||||||
Actual | Adjustments | Adjusted (1) | Actual | Adjustments | Adjusted (2) | |||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Rental | $ | 126,540 | $ | — | $ | 126,540 | $ | 113,443 | $ | — | $ | 113,443 | ||||||||||||
Sales | 7,188 | — | 7,188 | 7,824 | — | 7,824 | ||||||||||||||||||
Other | 789 | (77 | ) | 712 | 1,948 | — | 1,948 | |||||||||||||||||
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Total revenues | 134,517 | (77 | ) | 134,440 | 123,215 | — | 123,215 | |||||||||||||||||
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Costs and expenses: | ||||||||||||||||||||||||
Rental, selling and general expenses | 78,443 | (705 | ) | 77,738 | 76,554 | (4,994 | ) | 71,560 | ||||||||||||||||
Cost of sales | 4,772 | — | 4,772 | 5,813 | — | 5,813 | ||||||||||||||||||
Restructuring expenses | 16,025 | (16,025 | ) | — | 633 | (633 | ) | — | ||||||||||||||||
Depreciation and amortization | 15,269 | — | 15,269 | 11,414 | — | 11,414 | ||||||||||||||||||
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Total costs and expenses | 114,509 | (16,730 | ) | 97,779 | 94,414 | (5,627 | ) | 88,787 | ||||||||||||||||
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Income from operations | 20,008 | 16,653 | 36,661 | 28,801 | 5,627 | 34,428 | ||||||||||||||||||
Other expense: | ||||||||||||||||||||||||
Interest expense | (8,914 | ) | — | (8,914 | ) | (7,538 | ) | — | (7,538 | ) | ||||||||||||||
Deferred financing costs write-off | (931 | ) | 931 | — | — | — | — | |||||||||||||||||
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Income before tax provision | 10,163 | 17,584 | 27,747 | 21,263 | 5,627 | 26,890 | ||||||||||||||||||
Income tax provision | 658 | 8,652 | 9,310 | 8,400 | 1,465 | 9,865 | ||||||||||||||||||
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Net income | $ | 9,505 | $ | 8,932 | $ | 18,437 | $ | 12,863 | $ | 4,162 | $ | 17,025 | ||||||||||||
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EBITDA | $ | 35,277 | $ | 54,924 | $ | 40,215 | $ | 49,035 | ||||||||||||||||
EBITDA as a percentage of total revenues | 26.2 | % | 40.9 | % | 32.6 | % | 39.8 | % | ||||||||||||||||
Earnings per share: | ||||||||||||||||||||||||
Basic | $ | 0.21 | $ | 0.42 | $ | 0.28 | $ | 0.37 | ||||||||||||||||
Diluted | 0.21 | 0.41 | 0.28 | 0.37 | ||||||||||||||||||||
Weighted average number of common and common share equivalents outstanding: | ||||||||||||||||||||||||
Basic | 44,383 | 44,383 | 45,724 | 45,724 | ||||||||||||||||||||
Diluted | 44,762 | 44,762 | 46,365 | 46,365 |
(1) | Adjusted column for the three months ended December 31, 2015 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See reconciliations herein, and additional non-GAAP financial information, including additional information regarding these adjustments, following in this earnings release. |
(2) | Adjusted column for the three months ended December 31, 2014 excludes certain transactions that management believes are not indicative of its business as described below. Adjusted figures are a non-GAAP presentation. See reconciliations herein, and additional information regarding non-GAAP financial information following in this earnings release. Adjustments in the three months ended December 31, 2014 include: |
• | Reduction of $5.0 million to rental, selling and general expenses for acquisition-related expenses, primarily due to the acquisition of Evergreen Tank Solutions (“ETS”) in December 2014. |
• | Costs of $0.6 million related to the restructuring of our business operations. |
Mobile Mini, Inc. News Release February 5, 2016 | Page 6 |
Mobile Mini, Inc.
Condensed Consolidated Statements of Income
(Unaudited, except as indicated)
(in thousands, except per share data)
Year Ended December 31, 2015 | Year Ended December 31, 2014 | |||||||||||||||||||||||
Actual | Adjustments | Adjusted (1) | Actual | Adjustments | Adjusted (2) | |||||||||||||||||||
(audited) | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Rental | $ | 494,715 | $ | — | $ | 494,715 | $ | 410,362 | $ | — | $ | 410,362 | ||||||||||||
Sales | 29,953 | — | 29,953 | 31,585 | — | 31,585 | ||||||||||||||||||
Other | 6,109 | (4,173 | ) | 1,936 | 3,527 | — | 3,527 | |||||||||||||||||
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Total revenues | 530,777 | (4,173 | ) | 526,604 | 445,474 | — | 445,474 | |||||||||||||||||
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Costs and expenses: | ||||||||||||||||||||||||
Rental, selling and general expenses | 326,252 | (7,879 | ) | 318,373 | 280,948 | (5,070 | ) | 275,878 | ||||||||||||||||
Cost of sales | 19,671 | — | 19,671 | 21,944 | — | 21,944 | ||||||||||||||||||
Restructuring expenses | 20,798 | (20,798 | ) | — | 3,542 | (3,542 | ) | — | ||||||||||||||||
Asset impairment charge and loss on divestiture, net | 66,128 | (66,128 | ) | — | 557 | (557 | ) | — | ||||||||||||||||
Depreciation and amortization | 60,344 | — | 60,344 | 39,334 | — | 39,334 | ||||||||||||||||||
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Total costs and expenses | 493,193 | (94,805 | ) | 398,388 | 346,325 | (9,169 | ) | 337,156 | ||||||||||||||||
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Income from operations | 37,584 | 90,632 | 128,216 | 99,149 | 9,169 | 108,318 | ||||||||||||||||||
Other expense: | ||||||||||||||||||||||||
Interest income | 1 | — | 1 | — | — | — | ||||||||||||||||||
Interest expense | (35,900 | ) | — | (35,900 | ) | (28,729 | ) | — | (28,729 | ) | ||||||||||||||
Deferred financing costs write-off | (931 | ) | 931 | — | — | — | — | |||||||||||||||||
Foreign currency exchange | (2 | ) | — | (2 | ) | (1 | ) | — | (1 | ) | ||||||||||||||
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Income before tax provision | 752 | 91,563 | 92,315 | 70,419 | 9,169 | 79,588 | ||||||||||||||||||
Income tax (benefit) provision | (4,822 | ) | 37,093 | 32,271 | 26,033 | 2,505 | 28,538 | |||||||||||||||||
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Net income | $ | 5,574 | $ | 54,470 | $ | 60,044 | $ | 44,386 | $ | 6,664 | $ | 51,050 | ||||||||||||
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EBITDA | $ | 97,927 | $ | 200,836 | $ | 138,482 | $ | 162,141 | ||||||||||||||||
EBITDA as a percentage of total revenues | 18.4 | % | 38.1 | % | 31.1 | % | 36.4 | % | ||||||||||||||||
Earnings per share: | ||||||||||||||||||||||||
Basic | $ | 0.12 | $ | 1.34 | $ | 0.96 | $ | 1.11 | ||||||||||||||||
Diluted | 0.12 | 1.32 | 0.95 | 1.09 | ||||||||||||||||||||
Weighted average number of common and common share equivalents outstanding: | ||||||||||||||||||||||||
Basic | 44,953 | 44,953 | 46,026 | 46,026 | ||||||||||||||||||||
Diluted | 45,460 | 45,460 | 46,725 | 46,725 |
(1) | Adjusted column for the year ended December 31, 2015 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See reconciliations herein, and additional non-GAAP financial information, including additional information regarding these adjustments, following in this earnings release. |
(2) | Adjusted column for the year ended December 31, 2014 excludes certain transactions that management believes are not indicative of our business as described below. Adjusted figures are a non-GAAP presentation. See reconciliations herein, and additional information regarding non-GAAP financial information following in this earnings release. Adjustments in the year ended December 31, 2014 include: |
• | Reduction of $5.1 million to rental, selling and general expenses for acquisition-related expenses, primarily due to the acquisition of ETS in December 2014. |
• | Costs of $3.5 million related to the restructuring of our business operations. |
• | Asset impairment loss related to the completion of sale of certain assets written-down to fair value during the second quarter of 2013. |
Mobile Mini, Inc. News Release February 5, 2016 | Page 7 |
Mobile Mini, Inc.
Operating Data
(Unaudited)
2015 | 2014 | |||||||
As of December 31: | ||||||||
Stand-alone portable storage locations | 133 | 136 | ||||||
Stand-alone specialty containment locations | 19 | 24 | ||||||
Combined portable storage and specialty product locations | 7 | — | ||||||
Portable storage rental fleet units | 205,200 | 213,500 | ||||||
Specialty containment rental fleet units | 11,700 | 10,600 | ||||||
Average Utilization: | ||||||||
Portable storage – three months ended December 31 | 74.0 | % | 72.8 | % | ||||
Portable storage – twelve months ended December 31 | 69.4 | % | 68.6 | % | ||||
Specialty containment – three months ended December 31* | 64.4 | % | 70.6 | % | ||||
Specialty containment – twelve months ended December 31* | 68.0 | % | 70.1 | % |
* | Specialty containment 2014 includes portions of the periods prior to acquisition. |
Mobile Mini, Inc. News Release February 5, 2016 | Page 8 |
Mobile Mini, Inc.
Business Segment Information – Adjusted (1)
(Unaudited)
(in thousands)
Three Months Ended December 31, 2015 | Three Months Ended December 31, 2014 | |||||||||||||||||||||||
Portable Storage | Specialty Containment | Total | Portable Storage | Specialty Containment | Total | |||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Rental | $ | 102,196 | $ | 24,344 | $ | 126,540 | $ | 108,020 | $ | 5,423 | $ | 113,443 | ||||||||||||
Sales | 5,495 | 1,693 | 7,188 | 7,661 | 163 | 7,824 | ||||||||||||||||||
Other | 693 | 19 | 712 | 1,102 | 846 | 1,948 | ||||||||||||||||||
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Total revenues | 108,384 | 26,056 | 134,440 | 116,783 | 6,432 | 123,215 | ||||||||||||||||||
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Costs and expenses: | ||||||||||||||||||||||||
Rental, selling and general expenses | 62,505 | 15,233 | 77,738 | 68,206 | 3,354 | 71,560 | ||||||||||||||||||
Cost of sales | 3,604 | 1,168 | 4,772 | 5,707 | 106 | 5,813 | ||||||||||||||||||
Depreciation and amortization | 8,786 | 6,483 | 15,269 | 9,540 | 1,874 | 11,414 | ||||||||||||||||||
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Total costs and expenses | 74,895 | 22,884 | 97,779 | 83,453 | 5,334 | 88,787 | ||||||||||||||||||
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Income from operations | $ | 33,489 | $ | 3,172 | $ | 36,661 | $ | 33,330 | $ | 1,098 | $ | 34,428 | ||||||||||||
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Adjusted EBITDA | $ | 45,217 | $ | 9,707 | $ | 54,924 | $ | 46,063 | $ | 2,972 | $ | 49,035 | ||||||||||||
Adjusted EBITDA Margin | 41.7 | % | 37.3 | % | 40.9 | % | 39.4 | % | 46.2 | % | 39.8 | % | ||||||||||||
Year Ended December 31, 2015 | Year Ended December 31, 2014 | |||||||||||||||||||||||
Portable Storage | Specialty Containment | Total | Portable Storage | Specialty Containment | Total | |||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Rental | $ | 395,091 | $ | 99,624 | $ | 494,715 | $ | 404,939 | $ | 5,423 | $ | 410,362 | ||||||||||||
Sales | 22,387 | 7,566 | 29,953 | 31,422 | 163 | 31,585 | ||||||||||||||||||
Other | 1,864 | 72 | 1,936 | 2,681 | 846 | 3,527 | ||||||||||||||||||
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Total revenues | 419,342 | 107,262 | 526,604 | 439,042 | 6,432 | 445,474 | ||||||||||||||||||
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Costs and expenses: | ||||||||||||||||||||||||
Rental, selling and general expenses | 255,914 | 62,459 | 318,373 | 272,524 | 3,354 | 275,878 | ||||||||||||||||||
Cost of sales | 14,580 | 5,091 | 19,671 | 21,838 | 106 | 21,944 | ||||||||||||||||||
Depreciation and amortization | 34,828 | 25,516 | �� | 60,344 | 37,460 | 1,874 | 39,334 | |||||||||||||||||
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Total costs and expenses | 305,322 | 93,066 | 398,388 | 331,822 | 5,334 | 337,156 | ||||||||||||||||||
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Income from operations | $ | 114,020 | $ | 14,196 | $ | 128,216 | $ | 107,220 | $ | 1,098 | $ | 108,318 | ||||||||||||
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Adjusted EBITDA | $ | 160,686 | $ | 40,150 | $ | 200,836 | $ | 159,169 | $ | 2,972 | $ | 162,141 | ||||||||||||
Adjusted EBITDA Margin | 38.3 | % | 37.4 | % | 38.1 | % | 36.3 | % | 46.2 | % | 36.4 | % |
(1) | These tables present results by major business segment adjusted to exclude certain transactions that management believes are not indicative of our business. See additional information regarding non-GAAP financial information following in this earnings release. |
Mobile Mini, Inc. News Release February 5, 2016 | Page 9 |
Mobile Mini, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
December 31, | ||||||||
2015 | 2014 | |||||||
(unaudited) | (audited) | |||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 1,613 | $ | 3,739 | ||||
Receivables, net | 80,191 | 81,031 | ||||||
Inventories | 15,596 | 16,736 | ||||||
Rental fleet, net | 951,323 | 1,087,056 | ||||||
Property, plant and equipment, net | 131,687 | 113,175 | ||||||
Deposits and prepaid expenses | 8,651 | 8,586 | ||||||
Deferred financing costs and other assets | 10,562 | 8,858 | ||||||
Intangibles, net | 73,212 | 78,385 | ||||||
Goodwill | 706,387 | 705,608 | ||||||
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Total assets | $ | 1,979,222 | $ | 2,103,174 | ||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Liabilities: | ||||||||
Accounts payable | $ | 29,086 | $ | 22,933 | ||||
Accrued liabilities | 59,024 | 63,727 | ||||||
Lines of credit, net | 667,708 | 705,518 | ||||||
Obligations under capital leases | 38,274 | 24,918 | ||||||
Senior Notes, net | 200,000 | 200,000 | ||||||
Deferred income taxes | 219,601 | 231,547 | ||||||
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Total liabilities | 1,213,693 | 1,248,643 | ||||||
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Stockholders’ equity: | ||||||||
Common stock | 491 | 490 | ||||||
Additional paid-in capital | 584,447 | 569,083 | ||||||
Retained earnings | 352,262 | 380,504 | ||||||
Accumulated other comprehensive loss | (44,162 | ) | (29,870 | ) | ||||
Treasury stock | (127,509 | ) | (65,676 | ) | ||||
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Total stockholders’ equity | 765,529 | 854,531 | ||||||
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Total liabilities and stockholders’ equity | $ | 1,979,222 | $ | 2,103,174 | ||||
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Mobile Mini, Inc. News Release February 5, 2016 | Page 10 |
Mobile Mini, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
Year Ended December 31, | ||||||||
2015 | 2014 | |||||||
(unaudited) | (audited) | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income | $ | 5,574 | $ | 44,386 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Deferred financing costs write-off | 931 | — | ||||||
Asset impairment charge and loss on divestiture, net | 66,128 | 557 | ||||||
Non-cash restructuring expense | 12,411 | — | ||||||
Provision for doubtful accounts | 3,705 | 2,777 | ||||||
Amortization of deferred financing costs | 3,131 | 2,829 | ||||||
Amortization of long-term liabilities | 101 | 88 | ||||||
Share-based compensation expense | 13,827 | 15,071 | ||||||
Depreciation and amortization | 60,344 | 39,334 | ||||||
Gain on sale of rental fleet | (6,402 | ) | (5,732 | ) | ||||
Loss on disposal of property, plant and equipment | 2,188 | 348 | ||||||
Deferred income taxes | (5,629 | ) | 25,424 | |||||
Tax shortfall on equity award transactions | (166 | ) | (15 | ) | ||||
Foreign currency transaction loss | 2 | 1 | ||||||
Changes in certain assets and liabilities, net of effect of businesses acquired | (3,331 | ) | (4,443 | ) | ||||
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|
|
| |||||
Net cash provided by operating activities | 152,814 | 120,625 | ||||||
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|
|
| |||||
Cash Flows from Investing Activities: | ||||||||
Proceeds from wood mobile office divestiture, net | 83,280 | — | ||||||
Cash paid for businesses acquired, net of cash acquired | (18,525 | ) | (430,946 | ) | ||||
Additions to rental fleet, excluding acquisitions | (74,732 | ) | (27,279 | ) | ||||
Proceeds from sale of rental fleet | 16,865 | 23,053 | ||||||
Additions to property, plant and equipment, excluding acquisitions | (31,163 | ) | (15,779 | ) | ||||
Proceeds from sale of property, plant and equipment | 9,860 | 4,199 | ||||||
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|
| |||||
Net cash used in investing activities | (14,415 | ) | (446,752 | ) | ||||
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|
| |||||
Cash Flows from Financing Activities: | ||||||||
Net (payments) borrowings under lines of credit | (37,810 | ) | 386,204 | |||||
Deferred financing costs | (4,683 | ) | (719 | ) | ||||
Principal payments on capital lease obligations | (4,253 | ) | (1,956 | ) | ||||
Issuance of common stock | 1,703 | 3,642 | ||||||
Dividend payments | (33,700 | ) | (31,384 | ) | ||||
Purchase of treasury stock | (61,833 | ) | (26,007 | ) | ||||
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|
|
| |||||
Net cash (used in) provided by financing activities | (140,576 | ) | 329,780 | |||||
Effect of exchange rate changes on cash | 51 | (1,170 | ) | |||||
|
|
|
| |||||
Net change in cash | (2,126 | ) | 2,483 | |||||
Cash and cash equivalents at beginning of period | 3,739 | 1,256 | ||||||
|
|
|
| |||||
Cash and cash equivalents at end of period | $ | 1,613 | $ | 3,739 | ||||
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|
|
| |||||
Equipment and other acquired through capital lease obligations | $ | 17,638 | $ | 16,508 | ||||
Capital expenditures accrued or payable | 4,210 | 819 |
Mobile Mini, Inc. News Release February 5, 2016 | Page 11 |
Non-GAAP Financial Information
In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company also discloses in this press release certain non-GAAP financial information. These financial measures are not recognized measures under GAAP and they are not intended to be and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Adjusted net income, adjusted diluted earnings per share, EBITDA, adjusted EBITDA, EBITDA margin, adjusted EBITDA margin, and free cash flow are non-GAAP financial measures as defined by SEC rules. This non-GAAP financial information may be determined or calculated differently by other companies. Reconciliations of these non-GAAP measurements to the most directly comparable GAAP financial measurements are furnished earlier in this release, and as follows:
Mobile Mini, Inc.
Adjusted Income Reconciliations (1)
For the Three Months Ended December 31, 2015
(Unaudited)
(in thousands, except per share data)
Statement of Income As Reported | Restructuring Expense (2) | Acquisition- Related Expense | Transition Services (3) | Unclaimed Property Settlement (4) | Deferred financing costs write- off (5) | U.K. Enacted Tax Rate Change (6) | Statement of Income Adjusted | |||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Rental | $ | 126,540 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 126,540 | ||||||||||||||||
Sales | 7,188 | — | — | — | — | — | — | 7,188 | ||||||||||||||||||||||||
Other | 789 | — | — | (77 | ) | — | — | — | 712 | |||||||||||||||||||||||
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|
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|
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| |||||||||||||||||
Total revenues | 134,517 | — | — | (77 | ) | — | — | — | 134,440 | |||||||||||||||||||||||
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|
|
| |||||||||||||||||
Costs and expenses: | ||||||||||||||||||||||||||||||||
Rental, selling and general expenses | 78,443 | — | (257 | ) | (410 | ) | (38 | ) | — | — | 77,738 | |||||||||||||||||||||
Cost of sales | 4,772 | — | — | — | — | — | — | 4,772 | ||||||||||||||||||||||||
Restructuring expenses | 16,025 | (16,025 | ) | — | — | — | — | — | — | |||||||||||||||||||||||
Depreciation and amortization | 15,269 | — | — | — | — | — | — | 15,269 | ||||||||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total costs and expenses | 114,509 | (16,025 | ) | (257 | ) | (410 | ) | (38 | ) | — | — | 97,779 | ||||||||||||||||||||
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|
|
|
|
| |||||||||||||||||
Income from operations | 20,008 | 16,025 | 257 | 333 | 38 | 36,661 | ||||||||||||||||||||||||||
Other expense: | ||||||||||||||||||||||||||||||||
Interest expense | (8,914 | ) | — | — | — | — | — | — | (8,914 | ) | ||||||||||||||||||||||
Deferred financing costs write-off | (931 | ) | — | — | — | — | 931 | — | — | |||||||||||||||||||||||
|
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|
|
|
|
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|
| |||||||||||||||||
Income before income tax provision | 10,163 | 16,025 | 257 | 333 | 38 | 931 | — | 27,747 | ||||||||||||||||||||||||
Income tax provision | 658 | 6,166 | 99 | 128 | 15 | 358 | 1,886 | 9,310 | ||||||||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Net income | $ | 9,505 | $ | 9,858 | $ | 158 | $ | 205 | $ | 23 | $ | 573 | $ | (1,886 | ) | $ | 18,437 | |||||||||||||||
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|
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| |||||||||||||||||
Diluted shares outstanding | 44,762 | 44,762 | ||||||||||||||||||||||||||||||
Diluted earnings per share | $ | 0.21 | $ | 0.41 |
(1) | Adjustments exclude certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. |
(2) | Costs relating to the restructuring of our business, primarily the integration and geographic expansion of ETS into the existing Mobile Mini infrastructure. |
(3) | The $0.1 million of other revenue and $0.4 million of rental, selling and general expenses relate to the provision of short-term transition services, including housing wood mobile office units on our leased properties. |
(4) | Expense associated with the settlement of an unclaimed property liability with the state of Delaware. |
(5) | Write-off of existing deferred financing costs related to our prior ABL Credit Agreement upon entering into our Amended and Restated ABL Credit Agreement in December 2015. |
(6) | Adjustments to our existing net deferred income tax liabilities in the U.K. upon the fourth quarter 2015 enactment of a future statutory rate reduction. |
Mobile Mini, Inc. News Release February 5, 2016 | Page 12 |
Mobile Mini, Inc.
Adjusted Income Reconciliations (1)
For the Year Ended December 31, 2015
(Unaudited)
(in thousands, except per share data)
Statement of Income As Reported | Restructuring Expense (2) | Acquisition- Related Expense | Loss on Impairment and Divestiture and Transition Services (3) | Sales Tax Refund and Unclaimed Property Settlement (4) | Deferred financing costs write- off (5) | U.K. Enacted Tax Rate Change (6) | Statement of Income Adjusted | |||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Rental | $ | 494,715 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 494,715 | ||||||||||||||||
Sales | 29,953 | — | — | — | — | — | — | 29,953 | ||||||||||||||||||||||||
Other | 6,109 | — | — | (2,997 | ) | (1,176 | ) | — | — | 1,936 | ||||||||||||||||||||||
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|
|
|
|
|
|
| |||||||||||||||||
Total revenues | 530,777 | — | — | (2,997 | ) | (1,176 | ) | — | — | 526,604 | ||||||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Costs and expenses: | ||||||||||||||||||||||||||||||||
Rental, selling and general expenses | 326,252 | — | (2,650 | ) | (4,357 | ) | (872 | ) | — | — | 318,373 | |||||||||||||||||||||
Cost of sales | 19,671 | — | — | — | — | — | — | 19,671 | ||||||||||||||||||||||||
Restructuring expenses | 20,798 | (20,798 | ) | — | — | — | — | — | — | |||||||||||||||||||||||
Asset impairment charge and loss on divestiture, net | 66,128 | — | — | (66,128 | ) | — | — | — | — | |||||||||||||||||||||||
Depreciation and amortization | 60,344 | — | — | — | — | — | — | 60,344 | ||||||||||||||||||||||||
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|
|
|
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|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total costs and expenses | 493,193 | (20,798 | ) | (2,650 | ) | (70,485 | ) | (872 | ) | 398,388 | ||||||||||||||||||||||
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|
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|
|
| |||||||||||||||||
Income from operations | 37,584 | 20,798 | 2,650 | 67,488 | (304 | ) | 128,216 | |||||||||||||||||||||||||
Other expense: | ||||||||||||||||||||||||||||||||
Interest income | 1 | — | — | — | — | — | — | 1 | ||||||||||||||||||||||||
Interest expense | (35,900 | ) | — | — | — | — | — | — | (35,900 | ) | ||||||||||||||||||||||
Deferred financing costs write-off | (931 | ) | — | — | — | — | 931 | — | — | |||||||||||||||||||||||
Foreign currency exchange | (2 | ) | — | — | — | — | — | — | (2 | ) | ||||||||||||||||||||||
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|
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| |||||||||||||||||
Income before income tax provision | 752 | 20,798 | 2,650 | 67,488 | (304 | ) | 931 | — | 92,315 | |||||||||||||||||||||||
Income tax provision | (4,822 | ) | 7,967 | 1,016 | 25,983 | (117 | ) | 358 | 1,886 | 32,271 | ||||||||||||||||||||||
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|
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|
|
|
|
|
|
| |||||||||||||||||
Net income | $ | 5,574 | $ | 12,831 | $ | 1,634 | $ | 41,505 | $ | (187 | ) | $ | 573 | $ | (1,886 | ) | $ | 60,044 | ||||||||||||||
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| |||||||||||||||||
Diluted shares outstanding | 45,460 | 45,460 | ||||||||||||||||||||||||||||||
Diluted earnings per share | $ | 0.12 | $ | 1.32 |
(1) | Adjustments exclude certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. |
(2) | Costs relating to the restructuring of our business, primarily the integration and geographic expansion of ETS into the existing Mobile Mini infrastructure. |
(3) | Asset impairment and loss on divesture represents the impairment and loss associated with the divestiture of our North American wood mobile office business. The $3.0 million of other revenue and $4.4 million of rental, selling and general expenses relate to the provision of short-term transition services, including housing wood mobile office units on our leased properties. |
(4) | Revenue associated with a sales tax refund and expense associated with the settlement of an unclaimed property liability with the state of Delaware. |
(5) | Write-off of existing deferred financing costs related to our prior ABL Credit Agreement upon entering into our Amended and Restated ABL Credit Agreement in December 2015. |
(6) | Adjustments to our existing net deferred income tax liabilities in the U.K. upon the fourth quarter 2015 enactment of a future statutory rate reduction. |
Mobile Mini, Inc. News Release February 5, 2016 | Page 13 |
Mobile Mini, Inc.
Adjusted EBITDA GAAP Reconciliations
(Unaudited)
(in thousands)
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Net income | $ | 9,505 | $ | 12,863 | $ | 5,574 | $ | 44,386 | ||||||||
Interest expense | 8,914 | 7,538 | 35,900 | 28,729 | ||||||||||||
Income tax provision (benefit) | 658 | 8,400 | (4,822 | ) | 26,033 | |||||||||||
Depreciation and amortization | 15,269 | 11,414 | 60,344 | 39,334 | ||||||||||||
Deferred financing costs write-off | 931 | — | 931 | — | ||||||||||||
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|
|
|
|
|
|
| |||||||||
EBITDA | 35,277 | 40,215 | 97,927 | 138,482 | ||||||||||||
Share-based compensation expense | 2,994 | 3,193 | 12,277 | 14,490 | ||||||||||||
Restructuring expenses | 16,025 | 633 | 20,798 | 3,542 | ||||||||||||
Acquisition-related expenses | 257 | 4,994 | �� | 2,650 | 5,070 | |||||||||||
Impairment and divestiture-related revenues and expenses, net | 333 | — | 67,488 | 557 | ||||||||||||
Sales tax refund and unclaimed property settlement | 38 | — | (304 | ) | — | |||||||||||
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|
|
|
|
|
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| |||||||||
Adjusted EBITDA | $ | 54,924 | $ | 49,035 | $ | 200,836 | $ | 162,141 | ||||||||
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|
|
|
|
| |||||||||
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Net cash provided by operating activities | $ | 39,093 | $ | 32,867 | $ | 152,814 | $ | 120,625 | ||||||||
Interest paid | 11,950 | 10,065 | 32,372 | 24,559 | ||||||||||||
Income and franchise taxes paid | 1,661 | 158 | 4,935 | 1,103 | ||||||||||||
Share-based compensation expense, including restructuring expense | (2,994 | ) | (3,498 | ) | (13,827 | ) | (15,071 | ) | ||||||||
Asset impairment charge and loss on divestiture, net | — | — | (66,128 | ) | (557 | ) | ||||||||||
Non-cash restructuring expense | (12,411 | ) | — | (12,411 | ) | — | ||||||||||
Gain on sale of rental fleet | 1,206 | 1,236 | 6,402 | 5,732 | ||||||||||||
Loss on disposal of property, plant and equipment | (153 | ) | (529 | ) | (2,188 | ) | (348 | ) | ||||||||
Changes in other assets and liabilities, net of effect of businesses acquired | (3,075 | ) | (84 | ) | (4,042 | ) | 2,439 | |||||||||
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|
|
|
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| |||||||||
EBITDA | $ | 35,277 | $ | 40,215 | $ | 97,927 | $ | 138,482 | ||||||||
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|
|
Mobile Mini, Inc.
Free Cash Flow GAAP Reconciliation
(Unaudited)
(in thousands)
Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Net cash provided by operating activities | $ | 39,093 | $ | 32,867 | $ | 152,814 | $ | 120,625 | ||||||||
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|
|
|
|
|
|
| |||||||||
Additions to rental fleet, excluding acquisitions | (21,192 | ) | (10,969 | ) | (74,732 | ) | (27,279 | ) | ||||||||
Proceeds from sale of rental fleet | 3,565 | 5,240 | 16,865 | 23,053 | ||||||||||||
Additions to property, plant and equipment, excluding acquisitions | (13,245 | ) | (4,102 | ) | (31,163 | ) | (15,779 | ) | ||||||||
Proceeds from sale of property, plant and equipment | 7,413 | 825 | 9,860 | 4,199 | ||||||||||||
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|
|
|
|
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| |||||||||
Net capital expenditures, excluding acquisitions | (23,459 | ) | (9,006 | ) | (79,170 | ) | (15,806 | ) | ||||||||
|
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|
|
|
| |||||||||
Free cash flow | $ | 15,634 | $ | 23,861 | $ | 73,644 | $ | 104,819 | ||||||||
|
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|
|
|
|
|
|
Mobile Mini, Inc. News Release February 5, 2016 | Page 14 |
Adjusted net income information and adjusted diluted earnings per share.Adjusted net income and related earnings per share information exclude certain transactions that management believes are not indicative of our business. We believe that the inclusion of this non-GAAP presentation makes it easier to compare our financial performance across reporting periods on a consistent basis.
EBITDA and adjusted EBITDA. EBITDA is defined as net income before discontinued operations, net of tax (if applicable), interest expense, income taxes, depreciation and amortization, and debt restructuring or extinguishment expense (if applicable), including any write-off of deferred financing costs. Adjusted EBITDA further excludes certain non-cash expenses, including share-based compensation, as well as transactions that management believes are not indicative of our business. Because EBITDA and adjusted EBITDA, as defined, exclude some but not all items that affect our cash flow from operating activities, they may not be comparable to similarly titled performance measures presented by other companies.
We present EBITDA and adjusted EBITDA because we believe they provide useful information regarding our ability to meet our future debt payment requirements, capital expenditures and working capital requirements and that they provide an overall evaluation of our financial condition. EBITDA and adjusted EBITDA have certain limitations as analytical tools and should not be used as substitutes for net income, cash flows from operations, or other consolidated income or cash flow data prepared in accordance with GAAP.
EBITDA and adjusted EBITDA margins are calculated as EBITDA and adjusted EBITDA divided by total revenues expressed as a percentage. The GAAP financial measure that is most directly comparable to EBITDA margin is operating margin, which represents operating income divided by revenues.
Free Cash Flow. Free cash flow is defined as net cash provided by operating activities, minus or plus, net cash used in or provided by investing activities, excluding acquisitions and certain transactions. Free cash flow is a non-GAAP financial measure and is not intended to replace net cash provided by operating activities, the most directly comparable financial measure prepared in accordance with GAAP. We present free cash flow because we believe it provides useful information regarding our liquidity and ability to meet our short-term obligations. In particular, free cash flow indicates the amount of cash available after capital expenditures for, among other things, investments in our existing business, debt service obligations, payment of authorized quarterly dividends, repurchase of our common stock and strategic small acquisitions.