EXHIBIT 99.1
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FOR RELEASE: IMMEDIATELY CONTACT: ROBERT W. WILLMSCHEN
(708) 468-2002
LARRY RUDNICK
(708) 468-2408
SAFETY-KLEEN CORP. TOPS $50 MILLION IN NET EARNINGS FOR 1994
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ELGIN, IL, February 10, 1995 -- Donald W. Brinckman, Chairman of Safety-Kleen
Corp., announced today that the Company achieved $50.1 million, or $.87 per
share, in net earnings for the full year 1994. This represents an increase of
45% over net earnings reported for 1993. This comparison and all of the
remaining comparisons to 1993 are before restructuring and special charges
recorded in 1993. Fourth quarter 1994 net earnings were $16.7 million, or $.29
per share, an increase of 72% from 1993 net earnings of $9.7 million, or $.17
per share . Revenue for the fourth quarter 1994 increased 3% to $249.0 million.
Revenue for the full year 1994 was $791.3 million, down $4.2 million, or 0.5%,
from last year. Revenue for the fourth quarter and the year was up 6% and 2%,
respectively, excluding the 1993 revenue of product lines and other businesses
that were discontinued in 1994.
Revenues from the North American Automotive/Retail Repair Service and the North
American Industrial Parts Cleaner Service totaled $351 million for the full year
1994, down 4% from last year. This decline in revenues is primarily due to
planned discontinuance of Allied Product sales in 1994 and an increase in the
average parts cleaner service interval. Total parts cleaners in service
worldwide increased 15,300 units, or 3%, during 1994. This compares to a net
decrease of 14,100 units, or 2%, for 1993. The fourth quarter of 1994 showed
the largest quarterly gain of the year with a net increase of 6,500 units in
service from the end of the third quarter. The improved year-to-year
performance is due primarily to a reduction in the turnover rate of existing
customers as the Company continued to convert customers to the new cyclonic
parts cleaner.
Revenue of the Industrial Fluid Recovery Service grew 13% to $109 million in
1994. However, in the fourth quarter, revenue of this service grew 18% over
1993. The Company increased the number of
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Branch Industrial Managers selling to this market by 17% in 1994 and plans to
add another 35% in 1995.
Revenue of the Oil Recovery Service was $118 million in 1994, up 4% from last
year. Net income for these operations was approximately $1.5 million in 1994,
as compared to a net loss of $1.3 million in 1993.
Revenue of the Company's European operations totaled $85 million, an increase of
7% from 1993. The European operations reported net earnings of approximately
$0.8 million, as compared to a net loss of $2.2 million in 1993.
Brinckman said, "The Company is in the process of rolling out its new Imaging
Services business. Subsequent to year-end we completed the acquisition of Drew
Resources Corp., a California based photochemical equipment and service provider
with approximately 2,000 customers. This acquisition, along with the previously
announced acquisition of the Boston Recovery Company, should help to accelerate
the growth of this new business area for Safety-Kleen. In January, 1995 we also
acquired a parts cleaner service business from Sparkle Corp., which should add
approximately $5 million of annual revenue. This acquisition confirms our
commitment to grow this core business."
"Our operating margin in the current quarter was 13.2% of revenue, up from 8.0%
in 1993. For the full year our operating margin increased from 8.9% in 1993 to
12.6% in 1994. These improvements are primarily the result of the restructuring
actions begun in the fourth quarter of 1993, and improved pricing in certain of
our services in 1994."
Brinckman concluded, "We experienced substantial year-to-year earnings
improvements in most of our operations in 1994. The cyclonic parts cleaner has
been well received, with almost 103,000 of these units in service at year-end
1994. This has led to renewed growth in units in service in the
Automotive/Retail Repair market and increased growth in the Industrial Parts
Cleaner market. In
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addition, we are seeing excellent growth in the Industrial Fluid Recovery
Service. We believe that the Imaging Services market offers an exciting new
growth opportunity for the Company. Further, our European operations turned
profitable in 1995, and we believe these operations should continue to improve
in profitability as we increase the customer base in Europe. We believe we are
entering 1995 with a good deal of momentum and look forward to continued
earnings growth."
Safety-Kleen Corp. is the world's largest recycler of automotive and industrial
hazardous and non-hazardous fluids. Safety-Kleen's common stock is traded on
the New York Stock Exchange under the trading symbol SK.
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CONSOLIDATED STATEMENT OF EARNINGS
(thousands, except per share amounts)
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SIXTEEN FIFTY-TWO
WEEKS ENDED WEEKS ENDED
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Dec. 31, 1994 Jan. 1, 1994 Dec. 31, 1994 Jan. 1, 1994
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Revenue
North America
Automotive/Retail Repair Services $73,449 $76,354 $237,780 $248,700
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Industrial Services
Parts Cleaner 34,897 35,538 113,007 116,148
Fluid Recovery 35,402 29,940 109,113 96,792
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Total Industrial 70,299 65,478 222,120 212,940
Oil Recovery Services 38,230 33,590 117,815 113,277
Other 39,636 43,158 128,172 141,117
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Total North America 221,614 218,580 705,887 716,034
Europe 27,358 23,749 85,380 79,474
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Total Consolidated Revenue $248,972 $242,329 $791,267 $795,508
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Operating costs and expenses 180,238 186,803 579,509 605,815
Selling and administrative expenses 35,828 36,190 112,434 119,037
Restructuring and special charges - 229,000 - 229,000
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Operating income (loss) 32,906 (209,664) 99,324 (158,344)
Interest income 321 200 711 846
Interest expense (5,330) (3,585) (15,209) (11,111)
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Earnings (loss) before income taxes 27,897 (213,049) 84,826 (168,609)
Income taxes 11,188 (86,772) 34,732 (67,263)
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Net earnings (loss) $16,709 ($126,277) $50,094 ($101,346)
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Earnings (loss) per common and common
equivalent share $0.29 ($2.19) $0.87 ($1.76)
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Average number of common and common
equivalent shares outstanding 57,774 57,684 57,741 57,679
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Cash dividends per common share $0.09 $0.09 $0.36 $0.36
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1. The Company recorded restructuring and special charges to operating expense
of $229 million ($136 million or $2.36 per share, after tax) in the fourth
interim period of 1993. The total includes $179 million of asset write-downs
and other charges related to a restructuring program announced in December,
1993, and $50 million for a change in accounting estimate for future
environmental remediation costs relating to all operating and previously
closed Company sites. The Company also recorded a $1.5 million increase in
income tax expense in the third interim period of 1993 to revalue the prior
year deferred tax balance primarily due to an increase in the statutory
income tax rate in the United States.
2. The Company's interim reporting periods are twelve weeks each for the first
three reporting periods of the year and sixteen weeks for the fourth
reporting period.
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SAFETY-KLEEN CORP.
Key Statistics
FIFTY-TWO WEEKS ENDED DEC. 31, 1994 AND JAN. 1, 1994
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Percent
1994 1993 Change Change
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Parts Cleaners In Service Qtr. End *
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Industrial 138,103 127,380 10,723 8.4%
All Other 448,458 443,846 4,612 1.0%
Total 586,561 571,226 15,335 2.7%
Average Service Interval in Weeks 7.85 6.50 1.35 20.8%
North America Fluid Recovery Service
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No. of Drums Collected - QTR. 110,682 83,581 27,101 32.4%
No. of Drums Collected - YTD 331,847 263,318 68,529 26.0%
Oil Recovery Service
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Used Oil Gallons Collected - QTR. 38.4 Million 35.0 Million 3.4 Million 9.7%
Used Oil Gallons Collected - YTD 124.2 Mil1ion 112.8 Million 11.4 Million 10.1%
Average Price Per Used Oil Gal. Collected - QTR.
Branch Collections $0.149 $0.142 $0.007 4.9%
Bulk/Industrial Collection ($0.099) ($0.046) ($0.053) 115.2%
Total $0.121 $0.126 ($0.005) -4.0%
Average Price Per Used Oil Gal. Collected - YTD
Branch Collections $0.140 $0.147 ($0.007) -4.8%
Bulk/Industrial Collection ($0.083) ($0.052) ($0.031) 59.6%
Total $0.115 $0.129 ($0.014) -10.9%
Avg. US Base Oil Selling Price Per Gallon - QTR. $0.955 $0.936 $0.019 2.0%
Avg. US Base Oil Selling Price Per Gallon - YTD $0.923 $0.992 ($0.069) -7.0%
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* The number of Parts Cleaners does not include those from the acquisition of
Sparkle Corporation