Exhibit 99.1
IRON MOUNTAIN INCORPORATED REPORTS FOURTH QUARTER 2004 FINANCIAL RESULTS
* Total Revenues are $479 Million, Up 17%
* Operating Income is $87 Million
* OIBDA is $131 Million; 27.3% of Revenues
* Net Income is $0.23 per Diluted Share
BOSTON, March 2 /PRNewswire-FirstCall/ -- Iron Mountain Incorporated (NYSE:
IRM), the leader in records and information management services, today announced
its financial results for the year ended December 31, 2004 and reported higher
revenues, operating income and OIBDA for the fourth quarter ended December 31,
2004. Net income for the quarter was $0.23 per diluted share.
Iron Mountain's total consolidated revenues for the quarter ended December
31, 2004 grew to $479 million, an increase of 17% compared with the quarter
ended December 31, 2003. For the quarter, storage revenues grew 15% and service
revenues grew 21% compared to the same period in 2003. 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 64th consecutive quarter for
which the Company has reported increased storage revenues.
For the fourth quarter of 2004, the storage and service revenue internal
growth rates were 9% and 9%, respectively, yielding a total internal revenue
growth rate of 9%.
Richard Reese, the Company's Chairman and CEO, stated, "2004 was an
important year for Iron Mountain. Financially we ended the year within or above
all of our target ranges and strategically we made major strides in all of our
major growth initiatives. We established ourselves as the largest North American
provider of integrated shredding services, consolidated ownership of important
international businesses in Europe and Latin America and, with the acquisition
of Connected Corp. in November, became the leader in the management and
protection of distributed data. In a year of significant expansion and
transition, our sales force exceeded production expectations. We have built a
tremendous organization, our value proposition is strengthening and our
opportunities continue to grow. In 2005, we look forward to even greater
effectiveness and efficiency from our selling organization and a sharper focus
on execution throughout the entire Company as we profitably capture the
tremendous opportunity we see before us."
Operating income before depreciation and amortization ("OIBDA") was $131
million, or 27.3% of revenues, for the quarter ended December 31, 2004 compared
to $124 million, or 30.3% of revenues, for the quarter ended December 31, 2003.
See Appendix A at the end of this press release for a discussion of OIBDA and
the required reconciliation to the appropriate GAAP measures.
Operating income for the fourth quarter of 2004 was $87 million, or 18% of
revenues, compared to $87 million, or 21% of revenues, for the same period in
2003. Net income for the quarter was $30 million, or $0.23 per diluted share, an
increase of 5% from $28 million, or $0.22 per diluted share, for the same period
in 2003. All per share amounts have been adjusted to reflect the three-for-two
stock split, effected in the form of a dividend, paid on June 30, 2004.
Included in net income for the fourth quarter of 2004 is $12 million, or
$0.05 per diluted share, of other income, net comprised primarily of foreign
currency related net gains due to the strengthening of the Euro and the Canadian
Dollar. The net effect of the exchange rate fluctuations relative to the British
Pound Sterling was less than $3 million due primarily to the implementation of
the Company's hedging strategy relative to that currency. Included in net income
for the fourth quarter of 2003 is $5 million, or $0.02 per diluted share, of
other income, net comprised primarily of $11 million of foreign currency related
net gains, due primarily to the strengthening of the Canadian Dollar and the
British Pound Sterling, which was partially offset by $7 million of charges for
the early extinguishment of debt related to the Company's 2003 refinancing
activities.
For the year ended December 31, 2004, the Company reported total
consolidated revenues of $1.82 billion, an increase of 21%, with storage
revenues growing at 19% and service revenues growing at 24% compared to the
prior year. For the year, storage and service revenue internal growth rates were
9% and 6%, respectively, yielding a total internal revenue growth rate of 8%.
OIBDA was $508 million, or 28.0% of revenues, for the year ended December
31, 2004 compared to $436 million, or 29.0% of revenues, for the year ended
December 31, 2003.
Operating income for 2004 was $344 million, or 19% of revenues, compared to
$305 million, or 20% of revenues, for 2003. Net income was $94 million, or $0.72
per diluted share, for 2004, compared to $85 million, or $0.65 per diluted
share, for 2003.
Included in net income for 2004 is $8 million, or $0.04 per diluted share,
of other income, net comprised primarily of $9 million of foreign currency
related net gains, due primarily to the strengthening of the British Pound
Sterling, the Euro and the Canadian Dollar, which was partially offset by $2
million of charges for the early extinguishment of debt related to the Company's
2004 refinancing activities. Included in net income for 2003 is $3 million, or
$0.01 per diluted share, of other income, net comprised primarily of $30 million
of foreign currency related net gains, due primarily to the strengthening of the
Canadian Dollar offset by $28 million of charges for the early extinguishment of
debt related to the Company's 2003 refinancing activities.
In line with its strategy, Iron Mountain made selected acquisitions,
opportunistically buying attractive businesses that provide a strong platform
for future growth by expanding the Company's geographic footprint and
information management product offerings and enhancing its existing operations.
Since the end of November 2004, the Company has completed four secure shredding
acquisitions and the purchase of minority interests in two of our Latin American
subsidiaries for total consideration of approximately $33 million in cash.
The most significant fourth quarter 2004 transaction was the acquisition of
Framingham, Massachusetts-based Connected Corporation for total consideration of
approximately $109 million, net of cash acquired. The acquisition builds on Iron
Mountain's mission to protect its customers' information and to protect its
customers through compliant information management. Connected Corporation is a
technology and market leader in the protection, archiving and recovery of
distributed data. The transaction closed in early November.
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 December 31, 2005
Quarter Ending -----------------------------------------
March 31, 2005 Previous Current
------------------- ------------------- -------------------
Low High Low High Low High
-------- -------- -------- -------- -------- --------
Revenues $ 485 $ 495 $ 1,950 $ 2,020 $ 1,970 $ 2,030
Operating Income 78 85 341 360 345 360
Depreciation &
Amortization ~45 179 185 180 185
Capital Expenditures 220 250 220 250
Iron Mountain's conference call to discuss the fourth quarter and full year
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
http://www.ironmountain.com, the content of which is not part of this earnings
release. 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 235,000 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 http://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 federal
securities laws, and is subject to the safe-harbor created by such Act.
Forward-looking statements include 2005 financial performance outlook and
statements regarding our goals, beliefs, future growth 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) 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; (iv) the Company's ability or inability to
complete acquisitions on satisfactory terms and to integrate acquired companies
efficiently; (v) the cost and availability of financing for contemplated growth;
(vi) the possibility that business partners upon which the Company depends for
technical assistance or management and acquisition expertise outside the United
States will not perform as anticipated; (vii) changes in the political and
economic environments in the countries in which the Company's international
subsidiaries operate; 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.
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 Twelve Months
Ended Ended
December 31, December 31,
--------------------------- ---------------------------
2003 2004 2003 2004
------------ ------------ ------------ ------------
Revenues:
Storage
$ 240,262 $ 275,134 $ 875,035 $ 1,043,366
Service and Storage Material Sales 168,228 203,793 626,294 774,223
Total Revenues 408,490 478,927 1,501,329 1,817,589
Operating Expenses:
Cost of Sales (Excluding
Depreciation) 187,209 214,965 680,747 823,899
Selling, General and
Administrative 98,264 132,790 383,641 486,246
Depreciation and Amortization 37,007 43,717 130,918 163,629
(Gain) Loss on Disposal /
Writedown of Property, Plant
and Equipment, Net (756) 579 1,130 (681)
Total Operating Expenses 321,724 392,051 1,196,436 1,473,093
Operating Income 86,766 86,876 304,893 344,496
Interest Expense, Net 39,716 45,318 150,468 185,749
Other income, Net (4,925) (12,224) (2,564) (7,988)
Income Before Provision
for Income Taxes and
Minority Interest 51,975 53,782 156,989 166,735
Provision for Income Taxes 22,095 22,906 66,730 69,574
Minority Interest in Earnings of
Subsidiaries 1,454 989 5,622 2,970
Net Income $ 28,426 $ 29,887 $ 84,637 $ 94,191
Net Income Per Share - Basic $ 0.22 $ 0.23 $ 0.66 $ 0.73
Net Income Per Share - Diluted $ 0.22 $ 0.23 $ 0.65 $ 0.72
Weighted Average Common Shares
Outstanding - Basic 128,151 129,532 127,901 129,083
Weighted Average Common Shares
Outstanding - Diluted 130,205 131,537 130,077 131,176
Operating Income before
Depreciation and Amortization $ 123,773 $ 130,593 $ 435,811 $ 508,125
Iron Mountain Incorporated
Condensed Consolidated Balance Sheets
(Amounts in Thousands)
(Unaudited)
December 31, December 31,
2003 2004
------------ ------------
ASSETS
Current Assets:
Cash and Cash Equivalents $ 74,683 $ 31,942
Accounts Receivable (less allowances of
$20,922 and $13,886, respectively) 279,800 354,434
Other Current Assets 117,100 114,778
Total Current Assets 471,583 501,154
Property, Plant and Equipment:
Property, Plant and Equipment at Cost 1,950,893 2,266,839
Less: Accumulated Depreciation (458,626) (617,043)
Property, Plant and Equipment, net 1,492,267 1,649,796
Other Assets:
Goodwill, net 1,776,279 2,040,217
Other Non-current Assets, net 151,970 251,220
Total Other Assets 1,928,249 2,291,437
Total Assets $ 3,892,099 $ 4,442,387
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current Portion of Long-term Debt $ 115,781 $ 39,435
Other Current Liabilities 468,964 476,028
Total Current Liabilities 584,745 515,463
Long-term Debt, Net of Current Portion 1,974,147 2,438,587
Other Long-term Liabilities 191,308 256,724
Minority Interests 75,785 13,045
Shareholders' Equity 1,066,114 1,218,568
Total Liabilities and
Shareholders' Equity $ 3,892,099 $ 4,442,387
APPENDIX A
Operating Income Before Depreciation and Amortization
The Company uses Operating Income Before Depreciation and Amortization
("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).
Following is a reconciliation of operating income before depreciation and
amortization to operating income and net income (in millions):
Three Months Twelve Months
Ended Ended
December 31, December 31,
----------------------- -----------------------
2003 2004 2003 2004
---------- ---------- ---------- ----------
OIBDA (Operating Income Before
Depreciation and $ 124 $ 131 $ 436 $ 508
Amortization) (1)
Less: Depreciation and Amortization 37 44 131 164
Operating Income (1) $ 87 $ 87 $ 305 $ 344
Less: Interest Expense, net 40 45 150 186
Other (Income) Expense, net (5) (12) (3) (8)
Provision for Income Taxes 22 23 67 70
Minority Interest 1 1 6 3
Net Income (1) (2) $ 28 $ 30 $ 85 $ 94
Major Components of Other (Income)
Expense, net:
Foreign Exchange Effects $ (11) $ (11) $ (30) $ (9)
Debt Extinguishment
Charges $ 7 $ -- $ 28 $ 2
(1) Includes $1 million of gains and $1 million of losses on Disposal/
Write-down of Property, Plant and Equipment, net for the quarters ended
December 31, 2003 and 2004, respectively, and $1 million of losses and $1
million of gains on Disposal / Write-down of Property, Plant and Equipment,
net for the years ended December 31, 2003 and 2004, respectively.
(2) Columns may not foot due to rounding.
Contact: Stephen P. Golden
Director of Investor Relations
(617) 535-4799
SOURCE Iron Mountain Incorporated
-0- 03/02/2005
/CONTACT: Stephen P. Golden, Director of Investor Relations of Iron
Mountain Incorporated, +1-617-535-4799/
/Web site: http://www.ironmountain.com /