Exhibit 99.1
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Safety-Kleen Corp.
1000 N. Randall Road
Elgin, Illinois 60123
(708) 697-8460
For further information:
FOR RELEASE: IMMEDIATELY CONTACT: ROBERT W. WILLMSCHEN
(847) 468-2002
LAURENCE M. RUDNICK
(847) 468-2408
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SAFETY-KLEEN CORP. REPORTS RECORD REVENUES, 6% GAIN IN NET EARNINGS FOR 1995
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ELGIN, IL, February 5, 1996 -- John G. Johnson, Jr., President and Chief
Executive Officer of Safety-Kleen Corp., announced today that the Company
earned $53.3 million, or $.92 per share, for the full year 1995, up 6% from
$50.1 million, or $.87 per share, in 1994. Revenue for the year increased
9% to $859 million, a new Company record.
In the fourth interim reporting period of 1995, revenue was $264 million, up
6% from 1994. Net earnings were $18.0 million, up 8% from 1994. Earnings per
share were $.31, compared to $.29 in 1994. These results included a pre-tax
charge of $12 million to increase the Company's reserves for environmental
remediation costs at its facilities. In addition, the interim results for the
fourth quarter included a pre-tax credit to income of $15.2 million to reduce
the amount of restructuring reserves, previously established in 1993, to the
expected required levels. These two items combined after-tax had no effect on
net earnings. The fourth interim period results also benefited from normal
year-end adjustments to accruals and other accounts recorded during 1995, which
were more favorable than those recorded at year-end 1994, by approximately
$2 million after-tax.
Mr. Johnson said, "We were pleased to get revenues growing again in 1995 after
three years of flat revenues. Our performance contrasts with the Hazardous
Waste Services Industry, in general, which has experienced significant
reductions in volume as companies have found ways to reduce the amount of
hazardous wastes they generate. While Safety-Kleen has also been affected by
these trends, the small quantity generators of wastes that we specialize in
serving are not as greatly impacted by waste minimization efforts. In many
cases our services help customers to minimize waste generation. We also
emphasize recycling and reuse as opposed to incineration or disposal of wastes.
We have developed a number of new non-hazardous and waste minimization services
over the past few years, such as our Oil Recovery Service and our unique
Cyclonic Parts Cleaner Service. Our WE CARE(TM) program helps these small
businesses explain the added value of recycling to their customers. We believe
that all of these things set Safety-Kleen apart from the rest of the industry
in 1995 and will continue to differentiate us in future years."
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Johnson added, "While we believe our operating results in 1995 were good
compared to the overall Hazardous Waste Services Industry, we fell short of
our internal goals and are not satisfied with our earnings growth rate,"
Johnson said. "Our earnings in 1995 were adversely affected by increased
operating costs, especially in the third quarter, at a number of our plants,
in addition to higher costs than expected at the cement kilns used for burning
of waste-derived fuels. We have taken action on a number of these issues, with
positive results in the fourth quarter, and expect better overall performance
in 1996. In addition, we incurred losses for the full year 1995 of approximately
$4 million pre-tax in our new Imaging Services business, compared to losses of
$1 million in 1994. Our revenue growth in this new business was slower than
anticipated and we are now adding dedicated Imaging Services sales specialists
in the major market areas at 40% of our U.S. branches to improve our growth
rate in this new market."
"We believe that our most significant growth opportunities are in our Industrial
Services, Imaging Services and Oil Recovery Service businesses in North America
and in our European operations. We look for minimal growth in our more mature
markets, including the Automotive/Retail Repair, Dry Cleaner, Paint Refinishing
and Envirosystems Services in North America, although we will continue to add
new products and services in these markets where appropriate. Our revenue growth
in 1995 was in-line with these expectations."
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. 30, 1995 Dec. 31, 1994 Dec. 30, 1995 Dec. 31, 1994
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Revenue
North America
Automotive/Retail Repair Services $73,314 $73,449 $239,668 $237,780
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Industrial Services
Parts Cleaner $37,045 34,897 118,854 113,007
Fluid Recovery $38,186 35,402 122,762 109,113
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Total Industrial $75,231 70,299 241,616 222,120
Oil Recovery Services $40,805 38,230 129,039 117,815
Other $43,756 39,636 149,755 128,172
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Total North America $233,106 221,614 760,078 705,887
Europe $30,865 27,358 99,173 85,380
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Consolidated Revenue $263,971 248,972 859,251 791,267
Operating costs and expenses $191,827 180,238 628,469 579,509
Selling and administrative expenses $36,339 35,828 122,319 112,434
Restructuring credit ($15,217) - (15,217) -
Charge for remediation costs $11,956 - 11,956 -
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Operating income $39,066 32,906 111,724 99,324
Interest income $318 321 974 711
Interest expense ($6,172) (5,330) (20,230) (15,209)
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Earnings before income taxes $33,212 27,897 92,468 84,826
Income taxes $15,237 11,188 39,165 34,732
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Net earnings $17,975 $16,709 $53,303 $50,094
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Earnings per common and common
equivalent share $0.31 $0.29 $0.92 $0.87
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Average number of common and common
equivalent shares outstanding 57,882 57,774 57,857 57,741
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Cash dividends per common share $0.09 $0.09 $0.36 $0.36
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1. The sixteen weeks ended December 30, 1995 included a pre-tax charge of $12
million to increase the Company's reserves for environmental remediation
costs at its facilities. In addition, the interim results for the fourth
quarter included a $15.2 million pre-tax credit to income to reduce the
amount of restructuring reserves previously established in 1993, to the
expected required levels. These two items combined after-tax had no effect
on net earnings.
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. 30, 1995 and Dec. 31, 1994
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Percent
1995 1994 Change Change
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Parts Cleaners In Service Year End *
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Industrial 147,451 138,103 9,348 6.8%
All Other 460,068 448,458 11,610 2.6%
Total 607,519 586,561 20,958 3.6%
Average Service Interval in Weeks 8.87 7.85 1.02 13.0%
Oil Recovery Service
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Branch Collection:
Used Oil/Glycol/Oily Water Gallons Collected
Quarter 38.5 Million 40.9 Million -2.4 Million -5.9%
Year-to-Date 128.5 Mil1ion 131.2 Million -2.7 Million -2.1%
Avg Revenue Per Used Oil/Glycol/Oily Water Gal. Collected
Quarter $0.301 $0.235 $0.066 28.1%
Year-to-Date $0.274 $0.227 $0.047 20.7%
Avg. Base Oil Selling Price Per Gallon
Quarter $0.993 $0.955 $0.038 4.0%
Year-to-Date $0.994 $0.923 $0.071 7.7%
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* The number of Parts Cleaners in the all other category in 1995, include
approximately 9,000 machines added as a result of acquisitions.