Exhibit 99.1
Iron Mountain Incorporated Reports First Quarter 2004 Financial Results
-- Total Revenues are $434 Million, Up 23%
-- Operating Income is $86 Million, Up 19%
-- Net Income is $0.26 per Diluted Share
-- Company Wins 2004 IR Magazine Award for Best Disclosure Policy
BOSTON, April 29 /PRNewswire-FirstCall/ --Iron Mountain Incorporated
(NYSE: IRM), the leader in records and information management services, today
announced its financial results for the quarter ended March 31, 2004. Total
revenues were $434 million, operating income was $86 million and net income
was $23 million, or $0.26 per diluted share for the quarter ended March 31,
2004. The Company also reported operating income before depreciation and
amortization ("OIBDA") of $123 million for the first quarter of 2004.
Richard Reese, the Company's Chairman and CEO, stated, "The business
performed well in the first quarter. Revenue grew 23%, primarily driven by
improved internal growth and acquisitions. We continue to gain traction in
our digital business as market acceptance begins to translate into revenue.
In Europe, we established ourselves as the leader in the important German
market with our acquisition of DISOS in March. 2004 is off to a solid start
and we are optimistic about achieving our financial objectives for the full
year."
Iron Mountain's total consolidated revenues for the quarter ended March
31, 2004 grew to $434 million, an increase of 23% compared with the quarter
ended March 31, 2003. For the quarter, storage revenues grew 23% and service
revenues grew 24% compared to the prior year. Storage revenues, which are
considered a key performance indicator for the records and information
management services industry, are largely recurring since customers typically
retain their records for many years. This marks the 61st consecutive quarter
for which the Company has reported increased quarterly storage revenues.
For the first quarter of 2004, the storage and service revenue internal
growth rates were 8% and 6%, respectively, yielding a total internal revenue
growth rate of 8%. The storage internal growth rate of 8% is in line with the
quarterly storage growth rates of 2002 and 2003. Core service revenues
continued to improve due primarily to increases in the Off-Site Data
Protection division and the Secure Shredding product line. Total core revenue
growth for the quarter was 9%. Complementary service revenues improved in the
first quarter of 2004, due primarily to increased carton sales in the US and a
solid quarter in the Company's fulfillment business and were flat compared to
the first quarter of 2003 on a same store basis.
Operating income for the first quarter of 2004 was $86 million, or 20% of
revenues, compared to $72 million, or 21% of revenues, for the same period in
2003. Operating income before depreciation and amortization increased 20% to
$123 million, or 28.4% of revenues, for the quarter ended March 31, 2004 from
$102 million, or 29.0% of revenues, for the quarter ended March 31, 2003.
Included in both operating income and OIBDA is a $2 million net gain on the
disposal of fixed assets recorded in the first quarter of 2003 that was not
repeated in 2004.
The Company uses OIBDA, an integral part of its planning and reporting
systems, to evaluate the operating performance of the consolidated business.
As such, the Company believes OIBDA provides current and potential investors
with relevant and useful information regarding its ability to grow revenues
faster than operating expenses. Additionally, the Company uses multiples of
current and projected OIBDA in conjunction with its discounted cash flow
models to determine its overall enterprise valuation and to evaluate
acquisition targets. OIBDA is not a measurement of financial performance
under accounting principles generally accepted in the United States, or GAAP,
and should not be considered as a substitute for operating or net income or
cash flows from operating activities (as determined in accordance with GAAP).
In accordance with Securities and Exchange Commission Regulation G, a
reconciliation of OIBDA to Operating Income to Net Income appears later in
this press release.
Net income for the quarter was $23 million, or $0.26 per diluted share,
compared to $21 million, or $0.25 per diluted share, for 2003. Included in
net income for the first quarter of 2004 is $2 million, or $0.02 per diluted
share, of other expense, net comprised almost entirely of charges for the
early extinguishment of debt related to the Company's 2004 refinancing
activities. Included in net income for the first quarter of 2003 is $3
million, or $0.02 per diluted share, of other income, net comprised primarily
of a $5 million foreign currency gain, which was offset by $2 million of
charges for the early extinguishment of debt related to the Company's 2003
first quarter refinancing activities. The Company expects to record a modest
charge of less than $1 million related to the refinancing of its senior credit
facility in the second quarter of 2004.
Following is a reconciliation of OIBDA to operating income to net income
(in millions):
Quarter ended
March 31,
2003 2004
OIBDA (Operating Income Before
Depreciation and Amortization) (1) $102 $123
Less: Depreciation and Amortization 30 37
Operating Income (1) $72 $86
Less: Interest Expense, net 36 43
Other (Income) Expense, net (3) 2
Provision for Income Taxes 17 17
Minority Interest 1 1
Net Income (1) $21 $23
Major Components of Other (Income) Expense, net:
Foreign Exchange Effects $(5) $--
Debt Extinguishment Charges $2 $2
(1) Includes a $2 million Gain on Disposal/Write-down of Property, Plant
and Equipment, net for the first quarter of 2003.
As previously reported, Iron Mountain acquired the remaining 49.9% equity
interest in Iron Mountain Europe Limited ("IME") from Mentmore plc, for total
consideration of approximately $154 million in cash, including the repayment
of all trade and working capital funding owed to Mentmore by IME. This
transaction gives Iron Mountain 100% ownership of IME, affording it full
access to all future cash flows and greater strategic and financial
flexibility. Other acquisitions completed in 2004, include 3 records
management businesses in Europe, 1 in Chile, 2 secure shredding businesses, a
film and sound business and an intellectual property protection business
specializing in domain name management.
The Company was active in both the high-yield debt market and the senior
credit market here in the US as well as in Europe during the first quarter of
2004. The Company successfully completed its first sterling denominated high-
yield offering raising GBP 150 million ($274 million) at an interest rate of
7.25%. Proceeds from this transaction were used primarily to fund the
acquisition of Mentmore's 49.9% equity interest in IME. In addition, the
Company called the remaining $20 million of Iron Mountain Canada Corporation's
8.125% Senior Notes due 2008.
In March 2004, IME and certain of its subsidiaries closed a GBP 200
million senior credit facility comprised of a GBP 100 million revolving credit
facility and a GBP 100 million term loan. The initial draw under this
facility was used primarily to repay GBP 135 million of the bridge financing
provided by Iron Mountain Incorporated to IME in connection with the Hays
acquisition in July 2003. The Company used these funds primarily to repay
certain real estate term loans, cross currency swaps and outstanding
borrowings under its revolving credit facility. In April 2004, the Company
refinanced its own senior credit facility, which was scheduled to mature in
January 2005, with a $550 million senior credit facility comprised of a $350
million revolving credit facility and a $200 million term loan. As of March
31, the Company's weighted average interest rate was 7.8% with a weighted
average maturity of approximately 9 years. The Company remains more than 85%
fixed with respect to interest rates.
Iron Mountain Wins Best Disclosure Policy at IR Magazine Award Ceremony in NYC
In March 2004, the Company was presented with the award for the Best
Disclosure Policy for a small to mid-cap company at the IR Magazine US Awards
2004 held in New York City. This prestigious honor is determined by in-depth
independent research conducted amongst 2,000 portfolio managers and analysts
covering the US market. "This award is a recognition of our corporate
philosophy to conduct candid and compliant discussions with our investors and
the financial community at large regarding our business," stated John Kenny,
the Company's CFO. "We would like to take this opportunity to thank everyone
who participated in the research leading to this award and for the vote of
confidence this represents."
Financial Performance Outlook
The following statements are based on current expectations and do not
include the potential impact of any future acquisitions. These statements are
forward-looking, and actual results may differ materially. Please refer to
the cautionary language included in this press release when considering this
information. The Company undertakes no obligation to update this information
(dollars in millions):
Full Year Ending Three Months Ending
December 31, 2004 June 30, 2004
Low High Low High
Revenues $1,750 $1,785 $435 $448
Operating Income 333 352 82 87
Depreciation &
Amortization 162 158 ~40
Capital Expenditures 210 240
Iron Mountain's conference call to discuss the first quarter 2004
financial results will be held today at 11:00 a.m. eastern time. In order to
further enhance the overall quality of its investor communications, the
Company will simulcast the conference call on its website at
www.ironmountain.com. A slide presentation providing summary financial and
statistical information that will be discussed on the conference call will
also be posted to the website and available for real-time viewing. The slide
presentation and replays of the conference call will be available on the
website for future reference.
About Iron Mountain
Iron Mountain Incorporated is the world's trusted partner for outsourced
records and information management services. Founded in 1951, the Company has
grown to service more than 200,000 customer accounts throughout the United
States, Canada, Europe and Latin America. Iron Mountain offers records
management services for both physical and digital media, disaster recovery
support services, and consulting - services that help businesses save money
and manage risks associated with legal and regulatory compliance, protection
of vital information, and business continuity challenges. For more
information, visit www.ironmountain.com.
Certain Important Factors
This press release contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, and is
subject to the safe harbor created by such Act. Forward-looking statements
include our second quarter and full year 2004 financial performance outlook
and statements regarding our goals, beliefs, strategies, objectives, plans or
current expectations. These statements involve known and unknown risks,
uncertainties and other factors that may cause the actual results to be
materially different from those contemplated in the forward-looking
statements. Such factors include, but are not limited to: (i) changes in
customer preferences and demand for the Company's services; (ii) changes in
the price for the Company's services relative to the cost of providing such
services; (iii) the cost and availability of financing for contemplated
growth; (iv) the Company's ability or inability to complete acquisitions on
satisfactory terms and to integrate acquired companies efficiently; (v) in the
various digital businesses in which the Company is engaged, capital and
technical requirements will be beyond the Company's means, markets for the
Company's services will be less robust than anticipated, or competition will
be more intense than anticipated; (vi) changes in the political and economic
environments in the countries in which the Company's international
subsidiaries operate; (vii) the possibility that business partners upon whom
the Company depends for technical assistance or management and acquisition
expertise outside the United States will not perform as anticipated; and
(viii) other trends in competitive or economic conditions affecting Iron
Mountain's financial condition or results of operations not presently
contemplated. Iron Mountain undertakes no obligation to release publicly the
result of any revision to these forward-looking statements that may be made to
reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.
Contact:
Stephen P. Golden
Director of Investor Relations
(617) 535-4799
NOTE: Condensed Consolidated Financial Statements of Iron Mountain
Incorporated follow.
Iron Mountain Incorporated
Condensed Consolidated Statements of Operations
(Amounts in Thousands except Per Share Data)
(Unaudited)
Three Months Ended
March 31,
2003 2004
Revenues:
Storage $202,831 $248,595
Service and Storage Material Sales 148,980 185,327
Total Revenues 351,811 433,922
Operating Expenses:
Cost of Sales (Excluding Depreciation) 160,151 198,310
Selling, General and Administrative 91,156 112,460
Depreciation and Amortization 29,949 37,280
(Gain) Loss on Disposal / Writedown of
Property, Plant and Equipment, Net (1,672) 120
Total Operating Expenses 279,584 348,170
Operating Income 72,227 85,752
Interest Expense, Net 35,565 43,459
Other (income) Expense, Net (3,260) 2,270
Income Before Provision for Income
Taxes and Minority Interest 39,922 40,023
Provision for Income Taxes 17,338 16,550
Minority Interest in Earnings of
Subsidiaries, Net 1,300 476
Net Income $21,284 $22,997
Net Income Per Share - Basic $0.25 $0.27
Net Income Per Share - Diluted $0.25 $0.26
Weighted Average Common Shares Outstanding
- Basic 85,097 85,705
Weighted Average Common Shares Outstanding
- Diluted 86,551 87,178
Operating Income before Depreciation
and Amortization $102,176 $123,032
Iron Mountain Incorporated
Condensed Consolidated Balance Sheets
(Amounts in Thousands)
(Unaudited)
December 31, March 31,
2003 2004
ASSETS
Current Assets:
Cash and Cash Equivalents $74,683 $30,978
Accounts Receivable (less allowances
of $20,922 and $17,810, respectively) 279,800 305,001
Other Current Assets 117,100 93,733
Total Current Assets 471,583 429,712
Property, Plant and Equipment:
Property, Plant and Equipment at Cost 1,950,893 2,019,642
Less: Accumulated Depreciation (458,626) (494,812)
Property, Plant and Equipment, net 1,492,267 1,524,830
Other Assets:
Goodwill, net 1,776,279 1,830,367
Other Non-current Assets, net 151,970 223,980
Total Other Assets 1,928,249 2,054,347
Total Assets $3,892,099 $4,008,889
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current Portion of Long-term Debt $115,781 $34,351
Other Current Liabilities 468,964 401,197
Total Current Liabilities 584,745 435,548
Long-term Debt, Net of Current Portion 1,974,147 2,262,768
Other Long-term Liabilities 191,308 198,537
Minority Interests 75,785 11,493
Shareholders' Equity 1,066,114 1,100,543
Total Liabilities and Shareholders'
Equity $3,892,099 $4,008,889
SOURCE Iron Mountain Incorporated
-0- 04/29/2004
/CONTACT: Stephen P. Golden, Director of Investor Relations of Iron
Mountain Incorporated, +1-617-535-4799/
/Photo: http://www.newscom.com/cgi-bin/prnh/20030505/IRMLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, 888-776-6555 or 212-782-2840/
/Web site: http://www.ironmountain.com/
(IRM)
CO: Iron Mountain Incorporated
ST: Massachusetts
IN: CPR
SU: ERN CCA MAV