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 tank and pump solutions in the United States, today reported actual and adjusted financial results for the quarter ended December 31, 2018.
Total revenues were $160.9 million and rental revenues were $152.0 million, as compared to $146.7 million and $138.5 million, respectively, for the same period last year. Rental revenues for the Storage Solutions and Tank & Pump Solutions businesses for the current quarter were $122.2 million and $29.9 million, respectively, compared to $112.8 million and $25.7 million, respectively, for the same period last year.
The Company realized net income of $14.2 million, or $0.32 per diluted share, in the fourth quarter of 2018. On an adjusted basis, fourth quarter net income was $23.7 million, or $0.53 per diluted share, as compared to adjusted net income of $18.1 million, or $0.41 per diluted share, for the fourth quarter of 2017. Adjusted EBITDA was $63.3 million and adjusted EBITDA margin was 39.3% for the fourth quarter of 2018.
Dividend
The Company’s Board of Directors declared a cash dividend of 27.5 cents per share, which will be paid on March 13, 2019 to shareholders of record as of February 27, 2019.
Fourth Quarter 2018 Highlights
- Continued strong rental revenue growth in Tank & Pump Solutions (“T&P”) with a 16.1% year-over-year increase.
- Delivered solid Storage Solutions (“SS”) rental revenue year-over-year growth of 8.3%, with record high seasonal business.
- Reached all-time high T&P OEC fleet on rent and drove average OEC utilization to 76.0% for the quarter, up 300 bps compared to the prior-year quarter.
- Increased total SS average units on rent by 2.7% year-over-year, with average unit utilization of 85.2% during the quarter.
- Raised SS core (excluding seasonal) rental rates in North America by 3.4%.
- Achieved adjusted EBITDA growth of 13.7%, compared to the prior-year quarter and expanded adjusted EBITDA margin by 140 basis points to 39.3%.
- Generated robust net cash from operating activities of $43.9 million and free cash flow of $24.9 million.
- Decreased our leverage ratio to 4.2x at December 31, 2018 from 5.0x December 31, 2017, as a result of both reduced debt and increased adjusted EBITDA.
CEO Comments
Erik Olsson, Mobile Mini’s Chief Executive Officer, remarked, “Fourth quarter 2018 results are the culmination of an exceptional year for Mobile Mini. Consolidated rental revenues were up 9.8% year-over-year, despite increasingly challenging comparisons. Seasonal rentals in North America exceeded the record-breaking numbers from the prior-year, contributing to rental revenue growth of 8.3% year-over year for consolidated Storage Solutions. Tank & Pump Solutions delivered growth of 16.1% by capitalizing on the wide-spread momentum in our customer end-segments and our exceptional overall service. By leveraging our infrastructure and efficiencies, we converted this robust top-line growth into increased profitability. Our adjusted EBITDA margin grew to 39.3% and we achieved $63.3 million in adjusted EBITDA, an increase of 13.7%, resulting in very strong free cash flow of $24.9 million for the fourth quarter of 2018.”
Mr. Olsson continued, “In 2018, we executed on our strategic plan and delivered outstanding results. Mobile Mini enters 2019 a financially stronger and more efficient company than ever before. We are committed to further differentiating Mobile Mini from our competitors by partnering with our customers to develop innovative solutions to their rental needs and striving to continuously improve processes throughout the Company. In North America, our Storage Solutions pending orders are significantly up compared to a year ago and our Tank & Pump business is positioned to capitalize on the strong demand from its end-markets. In the United Kingdom, where Brexit is causing some uncertainty in the general economy, our business has remained stable. Overall, our pipeline is healthy across all segments and economic indicators are solid. For 2019, we expect continued margin expansion as well as meaningful de-leveraging and we expect to exceed our Evergreen model for rental revenue growth.”
Conference Call
Mobile Mini will host a conference call today, Friday, February 1 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 at www.mobilemini.com on the Investor Relations 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 195,600 storage solutions containers and office units and a leading provider of tank and pump solutions in the U.S., with a rental fleet of approximately 12,600 units. Mobile Mini’s network is comprised of 154 locations in the U.S., U.K., and Canada. 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 ability to generate continued margin expansion and growth of revenue, adjusted EBITDA, and free cash flow, as well as our ability to decrease our leverage ratio, all of 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.
(See accompanying tables)
| Mobile Mini, Inc. | ||||||||||||||||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||
| (in thousands, except percentages and per share data) | ||||||||||||||||||||||||||||||
| Three Months Ended December 31, 2018 | Three Months Ended December 31, 2017 | |||||||||||||||||||||||||||||
| Actual | Adjustments | Adjusted (1) | Actual | Adjustments | Adjusted (2) | |||||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||||||
| Rental | $ | 152,048 | $ | — | $ | 152,048 | $ | 138,537 | $ | — | $ | 138,537 | ||||||||||||||||||
| Sales | 8,654 | — | 8,654 | 7,623 | — | 7,623 | ||||||||||||||||||||||||
| Other | 167 | — | 167 | 536 | — | 536 | ||||||||||||||||||||||||
| Total revenues | 160,869 | — | 160,869 | 146,696 | — | 146,696 | ||||||||||||||||||||||||
| Costs and expenses: | ||||||||||||||||||||||||||||||
| Rental, selling and general expenses | 95,090 | — | 95,090 | 87,484 | — | 87,484 | ||||||||||||||||||||||||
| Cost of sales | 5,512 | — | 5,512 | 4,962 | — | 4,962 | ||||||||||||||||||||||||
| Restructuring expenses | 700 | (700 | ) | — | 824 | (824 | ) | — | ||||||||||||||||||||||
|
Asset impairment charge and
loss on divestiture, net | 3,862 | (3,862 | ) | — | — | — | — | |||||||||||||||||||||||
| Depreciation and amortization | 16,794 | — | 16,794 | 16,431 | — | 16,431 | ||||||||||||||||||||||||
| Total costs and expenses | 121,958 | (4,562 | ) | 117,396 | 109,701 | (824 | ) | 108,877 | ||||||||||||||||||||||
| Income from operations | 38,911 | 4,562 | 43,473 | 36,995 | 824 | 37,819 | ||||||||||||||||||||||||
| Other income (expense): | ||||||||||||||||||||||||||||||
| Interest income | — | — | — | 5 | — | 5 | ||||||||||||||||||||||||
| Interest expense | (10,725 | ) | — | (10,725 | ) | (9,316 | ) | — | (9,316 | ) | ||||||||||||||||||||
| Foreign currency exchange | (5 | ) | — | (5 | ) | 4 | — | 4 | ||||||||||||||||||||||
| Income before income tax provision (benefit) | 28,181 | 4,562 | 32,743 | 27,688 | 824 | 28,512 | ||||||||||||||||||||||||
| Income tax provision (benefit) | 13,933 | (4,863 | ) | 9,070 | (64,383 | ) | 74,827 | 10,444 | ||||||||||||||||||||||
| Net income | $ | 14,248 | $ | 9,425 | $ | 23,673 | $ | 92,071 | $ | (74,003 | ) | $ | 18,068 | |||||||||||||||||
| EBITDA/Adjusted EBITDA | $ | 55,700 | $ | 63,263 | $ | 53,435 | $ | 55,624 | ||||||||||||||||||||||
| EBITDA/Adjusted EBITDA as a percentage of total revenues | 34.6 | % | 39.3 | % | 36.4 | % | 37.9 | % | ||||||||||||||||||||||
| Earnings per share: | ||||||||||||||||||||||||||||||
| Basic | $ | 0.32 | $ | 0.53 | $ | 2.09 | $ | 0.41 | ||||||||||||||||||||||
| Diluted | 0.32 | 0.53 | 2.07 | 0.41 | ||||||||||||||||||||||||||
|
Weighted average number of common and
common share equivalents outstanding: | ||||||||||||||||||||||||||||||
| Basic | 44,353 | 44,353 | 44,128 | 44,128 | ||||||||||||||||||||||||||
| Diluted | 44,885 | 44,885 | 44,444 | 44,444 | ||||||||||||||||||||||||||
| (1) | Adjusted column for the three months ended December 31, 2018 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the three-month period ended December 31, 2018 include the following: | |
| • Exclusion of costs of $0.7 million related to the restructuring of our business operations, along with the related tax effects. | ||
| • Exclusion of an asset impairment charge and loss on divestiture, net of proceeds, of $3.9 million related to assets that the Company placed as held for sale during the quarter, along with the related tax effects. | ||
| • Exclusion of $5.8 million in income tax provision resulting from an out-of-period adjustment recorded in the fourth quarter of 2018 to correct deferred tax assets that had been established in previous years. | ||
| (2) | Adjusted column for the three months ended December 31, 2017 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the three-month period ended December 31, 2017 include the following: | |
| • Exclusion of costs of $0.8 million related to the restructuring of our business operations, along with the related tax effects. | ||
| • Exclusion of $74.5 million in income tax benefit resulting from the Tax Cuts and Jobs Act (the “Tax Act”). | ||
| Mobile Mini, Inc. | ||||||||||||||||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||
| (in thousands, except percentages and per share data) | ||||||||||||||||||||||||||||||
| Twelve Months Ended December 31, 2018 | Twelve Months Ended December 31, 2017 | |||||||||||||||||||||||||||||
| Actual | Adjustments | Adjusted (1) | Actual | Adjustments | Adjusted (2) | |||||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||||||
| Rental | $ | 558,197 | $ | — | $ | 558,197 | $ | 498,825 | $ | — | $ | 498,825 | ||||||||||||||||||
| Sales | 34,354 | — | 34,354 | 32,440 | — | 32,440 | ||||||||||||||||||||||||
| Other | 678 | — | 678 | 2,284 | — | 2,284 | ||||||||||||||||||||||||
| Total revenues | 593,229 | — | 593,229 | 533,549 | — | 533,549 | ||||||||||||||||||||||||
| Costs and expenses: | ||||||||||||||||||||||||||||||
| Rental, selling and general expenses | 364,123 | — | 364,123 | 336,438 | (2,623 | ) | 333,815 | |||||||||||||||||||||||
| Cost of sales | 22,437 | — | 22,437 | 21,001 | — | 21,001 | ||||||||||||||||||||||||
| Restructuring expenses | 2,006 | (2,006 | ) | — | 2,886 | (2,886 | ) | — | ||||||||||||||||||||||
|
Asset impairment charge and
loss on divestiture, net | 102,140 | (102,140 | ) | — | — | — | — | |||||||||||||||||||||||
| Depreciation and amortization | 67,000 | — | 67,000 | 63,372 | — | 63,372 | ||||||||||||||||||||||||
| Total costs and expenses | 557,706 | (104,146 | ) | 453,560 | 423,697 | (5,509 | ) | 418,188 | ||||||||||||||||||||||
| Income from operations | 35,523 | 104,146 | 139,669 | 109,852 | 5,509 | 115,361 | ||||||||||||||||||||||||
| Other income (expense): | ||||||||||||||||||||||||||||||
| Interest income | 6 | — | 6 | 25 | — | 25 | ||||||||||||||||||||||||
| Interest expense | (40,904 | ) | — | (40,904 | ) | (35,728 | ) | — | (35,728 | ) | ||||||||||||||||||||
| Foreign currency exchange | 64 | — | 64 | (25 | ) | — | (25 | ) | ||||||||||||||||||||||
|
(Loss) income before income tax
provision (benefit) | (5,311 | ) | 104,146 | 98,835 | 74,124 | 5,509 | 79,633 | |||||||||||||||||||||||
| Income tax provision (benefit) | 2,751 | 22,475 | 25,226 | (48,104 | ) | 76,604 | 28,500 | |||||||||||||||||||||||
| Net (loss) income | $ | (8,062 | ) | $ | 81,671 | $ | 73,609 | $ | 122,228 | $ | (71,095 | ) | $ | 51,133 | ||||||||||||||||
| EBITDA/Adjusted EBITDA | $ | 102,593 | $ | 217,243 | $ | 173,224 | $ | 184,803 | ||||||||||||||||||||||
| EBITDA/Adjusted EBITDA as a percentage of total revenues | 17.3 | % | 36.6 | % | 32.5 | % | 34.6 | % | ||||||||||||||||||||||
| (Loss) earnings per share: | ||||||||||||||||||||||||||||||
| Basic | $ | (0.18 | ) | $ | 1.66 | $ | 2.77 | $ | 1.16 | |||||||||||||||||||||
| Diluted | (0.18 | ) | 1.64 | 2.76 | 1.16 | |||||||||||||||||||||||||
|
Weighted average number of common and
common share equivalents outstanding: | ||||||||||||||||||||||||||||||
| Basic | 44,295 | 44,295 | 44,055 | 44,055 | ||||||||||||||||||||||||||
| Diluted | 44,295 | 44,980 | 44,254 | 44,254 | ||||||||||||||||||||||||||
| (1) | Adjusted column for the twelve months ended December 31, 2018 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the twelve-month period ended December 31, 2018 include the following: | |
• Exclusion of costs of $2.0 million related to the restructuring of our business operations, along with the related tax effects. | ||
• Exclusion of an asset impairment charge and loss on divestiture, net of proceeds, of $102.1 million related to assets that the Company placed as held for sale during the period, along with the related tax effects. | ||
• Exclusion of $2.6 million in income tax benefit resulting from the reversal in the period of a provisional tax expense related to the repatriation of foreign earnings for the impact of the U.S. federal tax reform enacted in the fourth quarter of 2017. | ||
• Exclusion of $5.8 million in income tax provision resulting from an out-of-period adjustment recorded in the fourth quarter of 2018 to correct deferred tax assets that had been established in previous years. | ||
| (2) | Adjusted column for the twelve months ended December 31, 2017 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the twelve-month period ended December 31, 2017 include the following: | |
• Reduction of $0.1 million in rental, selling and general expenses for acquisition-related expenses, along with the related tax effects. | ||
• Reduction of $2.5 million in rental, selling and general expenses to exclude costs related to severance and transition in conjunction with the departure of executives, along with the related tax effects. | ||
• Exclusion of $2.9 million in costs related to the restructuring of our business operations, along with the related tax effects. | ||
• Exclusion of $74.5 million in income tax benefit resulting from the Tax Act. | ||
| Mobile Mini, Inc. | |||||||||
| Operating Data | |||||||||
| (Unaudited) | |||||||||
| 2018 | 2017 | ||||||||
| As of December 31: | |||||||||
| Stand-alone Storage Solutions locations | 117 | 121 | |||||||
| Stand-alone Tank & Pump Solutions locations | 20 | 17 | |||||||
| Combined Storage Solutions and Tank & Pump Solutions locations | 17 | 16 | |||||||
| Storage Solutions rental fleet units | 195,600 | 215,000 | |||||||
| Tank & Pump Solutions rental fleet units | 12,600 | 12,100 | |||||||
| Average utilization - Three months ended December 31: | |||||||||
| Storage Solutions - utilization based on number of units | 85.2 | % | 75.7 | % | |||||
| Tank & Pump Solutions - utilization based on original equipment cost | 76.0 | % | 73.0 | % | |||||
| Average utilization - Twelve months ended December 31: | |||||||||
| Storage Solutions - utilization based on number of units | 75.9 | % | 71.5 | % | |||||
| Tank & Pump Solutions - utilization based on original equipment cost | 74.0 | % | 66.5 | % | |||||
| Mobile Mini, Inc. | ||||||||||||||||||||||||||||||
| Business Segment Information - Adjusted (1) | ||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||
| (in thousands, except percentages) | ||||||||||||||||||||||||||||||
| Three Months Ended December 31, 2018 | Three Months Ended December 31, 2017 | |||||||||||||||||||||||||||||
Storage | Tank & Pump | Total | Storage | Tank & Pump | Total | |||||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||||||
| Rental | $ | 122,171 | $ | 29,877 | $ | 152,048 | $ | 112,810 | $ | 25,727 | $ | 138,537 | ||||||||||||||||||
| Sales | 7,247 | 1,407 | 8,654 | 6,226 | 1,397 | 7,623 | ||||||||||||||||||||||||
| Other | 129 | 38 | 167 | 457 | 79 | 536 | ||||||||||||||||||||||||
| Total revenues | 129,547 | 31,322 | 160,869 | 119,493 | 27,203 | 146,696 | ||||||||||||||||||||||||
| Costs and expenses: | ||||||||||||||||||||||||||||||
| Rental, selling and general expenses | 75,400 | 19,690 | 95,090 | 69,462 | 18,022 | 87,484 | ||||||||||||||||||||||||
| Cost of sales | 4,744 | 768 | 5,512 | 4,122 | 840 | 4,962 | ||||||||||||||||||||||||
| Depreciation and amortization | 10,084 | 6,710 | 16,794 | 10,296 | 6,135 | 16,431 | ||||||||||||||||||||||||
| Total costs and expenses | 90,228 | 27,168 | 117,396 | 83,880 | 24,997 | 108,877 | ||||||||||||||||||||||||
| Income from operations | $ | 39,319 | $ | 4,154 | $ | 43,473 | $ | 35,613 | $ | 2,206 | $ | 37,819 | ||||||||||||||||||
| Adjusted EBITDA | $ | 52,291 | $ | 10,972 | $ | 63,263 | $ | 47,227 | $ | 8,397 | $ | 55,624 | ||||||||||||||||||
| Adjusted EBITDA Margin | 40.4 | % | 35.0 | % | 39.3 | % | 39.5 | % | 30.9 | % | 37.9 | % | ||||||||||||||||||
| Twelve Months Ended December 31, 2018 | Twelve Months Ended December 31, 2017 | |||||||||||||||||||||||||||||
Storage | Tank & Pump | Total | Storage | Tank & Pump | Total | |||||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||||||
| Rental | $ | 447,464 | $ | 110,733 | $ | 558,197 | $ | 406,590 | $ | 92,235 | $ | 498,825 | ||||||||||||||||||
| Sales | 29,032 | 5,322 | 34,354 | 26,989 | 5,451 | 32,440 | ||||||||||||||||||||||||
| Other | 528 | 150 | 678 | 1,875 | 409 | 2,284 | ||||||||||||||||||||||||
| Total revenues | 477,024 | 116,205 | 593,229 | 435,454 | 98,095 | 533,549 | ||||||||||||||||||||||||
| Costs and expenses: | ||||||||||||||||||||||||||||||
| Rental, selling and general expenses | 287,648 | 76,475 | 364,123 | 265,390 | 68,425 | 333,815 | ||||||||||||||||||||||||
| Cost of sales | 19,439 | 2,998 | 22,437 | 17,930 | 3,071 | 21,001 | ||||||||||||||||||||||||
| Depreciation and amortization | 41,482 | 25,518 | 67,000 | 38,792 | 24,580 | 63,372 | ||||||||||||||||||||||||
| Total costs and expenses | 348,569 | 104,991 | 453,560 | 322,112 | 96,076 | 418,188 | ||||||||||||||||||||||||
| Income from operations | $ | 128,455 | $ | 11,214 | $ | 139,669 | $ | 113,342 | $ | 2,019 | $ | 115,361 | ||||||||||||||||||
| Adjusted EBITDA | $ | 180,089 | $ | 37,154 | $ | 217,243 | $ | 157,960 | $ | 26,843 | $ | 184,803 | ||||||||||||||||||
| Adjusted EBITDA Margin | 37.8 | % | 32.0 | % | 36.6 | % | 36.3 | % | 27.4 | % | 34.6 | % | ||||||||||||||||||
| (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. | ||||||||||
| Condensed Consolidated Balance Sheets | ||||||||||
| (in thousands) | ||||||||||
| December 31, | December 31, | |||||||||
| 2018 | 2017 | |||||||||
| (unaudited) | (audited) | |||||||||
| ASSETS | ||||||||||
| Cash and cash equivalents | $ | 5,605 | $ | 13,451 | ||||||
| Receivables, net | 130,233 | 111,562 | ||||||||
| Inventories | 11,725 | 15,671 | ||||||||
| Rental fleet, net | 929,090 | 989,154 | ||||||||
| Property, plant and equipment, net | 154,254 | 157,304 | ||||||||
| Other assets | 13,398 | 15,334 | ||||||||
| Intangibles, net | 55,542 | 62,024 | ||||||||
| Goodwill | 705,217 | 708,907 | ||||||||
| Total assets | $ | 2,005,064 | $ | 2,073,407 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
| Liabilities: | ||||||||||
| Accounts payable | $ | 33,177 | $ | 26,955 | ||||||
| Accrued liabilities | 88,136 | 78,084 | ||||||||
| Lines of credit | 593,495 | 634,285 | ||||||||
| Obligations under capital leases | 63,359 | 52,791 | ||||||||
| Senior notes, net | 246,489 | 245,850 | ||||||||
| Deferred income taxes | 170,139 | 173,754 | ||||||||
| Total liabilities | 1,194,795 | 1,211,719 | ||||||||
| Stockholders' equity: | ||||||||||
| Common stock | 500 | 497 | ||||||||
| Additional paid-in capital | 619,850 | 605,369 | ||||||||
| Retained earnings | 410,641 | 463,322 | ||||||||
| Accumulated other comprehensive loss | (72,861 | ) | (60,334 | ) | ||||||
| Treasury stock | (147,861 | ) | (147,166 | ) | ||||||
| Total stockholders' equity | 810,269 | 861,688 | ||||||||
| Total liabilities and stockholders' equity | $ | 2,005,064 | $ | 2,073,407 | ||||||
| Mobile Mini, Inc. | ||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||
| (Unaudited) | ||||||||||
| (in thousands) | ||||||||||
| Twelve Months Ended | ||||||||||
| December 31, | ||||||||||
| 2018 | 2017 | |||||||||
| Cash flows from operating activities: | ||||||||||
| Net (loss) income | $ | (8,062 | ) | $ | 122,228 | |||||
|
Adjustments to reconcile net (loss) income to net cash
provided by operating activities: | ||||||||||
| Asset impairment charge and loss on divestiture, net | 102,140 | — | ||||||||
| Provision for doubtful accounts | 2,412 | 5,037 | ||||||||
| Amortization of deferred financing costs | 2,060 | 2,060 | ||||||||
| Amortization of long-term liabilities | 145 | 130 | ||||||||
| Share-based compensation expense | 10,867 | 7,373 | ||||||||
| Depreciation and amortization | 67,000 | 63,372 | ||||||||
| Gain on sale of rental fleet | (6,055 | ) | (5,657 | ) | ||||||
| Loss on disposal of property, plant and equipment | 600 | 517 | ||||||||
| Deferred income taxes | (2,523 | ) | (49,980 | ) | ||||||
| Foreign currency exchange | (64 | ) | 25 | |||||||
|
Changes in certain assets and liabilities, net of
effect of businesses acquired | (8,422 | ) | (9,459 | ) | ||||||
| Net cash provided by operating activities | 160,098 | 135,646 | ||||||||
| Cash flows from investing activities: | ||||||||||
| Proceeds from sale of assets held for sale | 10,153 | — | ||||||||
| Additions to rental fleet, excluding acquisitions | (85,961 | ) | (63,688 | ) | ||||||
| Proceeds from sale of rental fleet | 14,993 | 12,953 | ||||||||
| Additions to property, plant and equipment, excluding acquisitions | (16,931 | ) | (20,122 | ) | ||||||
| Proceeds from sale of property, plant and equipment | 683 | 851 | ||||||||
| Net cash used in investing activities | (77,063 | ) | (70,006 | ) | ||||||
| Cash flows from financing activities: | ||||||||||
| Net repayments under lines of credit | (40,790 | ) | (6,875 | ) | ||||||
| Deferred financing costs | — | (12 | ) | |||||||
| Principal payments on capital lease obligations | (9,746 | ) | (7,418 | ) | ||||||
| Issuance of common stock | 3,617 | 5,800 | ||||||||
| Dividend payments | (44,530 | ) | (40,171 | ) | ||||||
| Purchase of treasury stock | (695 | ) | (8,367 | ) | ||||||
| Net cash used in financing activities | (92,144 | ) | (57,043 | ) | ||||||
| Effect of exchange rate changes on cash | 1,263 | 717 | ||||||||
| Net change in cash | (7,846 | ) | 9,314 | |||||||
| Cash and cash equivalents at beginning of period | 13,451 | 4,137 | ||||||||
| Cash and cash equivalents at end of period | $ | 5,605 | $ | 13,451 | ||||||
| Equipment and other acquired through capital lease obligations | $ | 20,314 | $ | 9,501 | ||||||
| Capital expenditures accrued or payable | 10,752 | 7,270 | ||||||||
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 EBITDA GAAP Reconciliations | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
| Net income (loss) | $ | 14,248 | $ | 92,071 | $ | (8,062 | ) | $ | 122,228 | |||||||||||
| Interest expense | 10,725 | 9,316 | 40,904 | 35,728 | ||||||||||||||||
| Income tax provision (benefit) | 13,933 | (64,383 | ) | 2,751 | (48,104 | ) | ||||||||||||||
| Depreciation and amortization | 16,794 | 16,431 | 67,000 | 63,372 | ||||||||||||||||
| EBITDA | 55,700 | 53,435 | 102,593 | 173,224 | ||||||||||||||||
| Share-based compensation expense | 3,001 | 1,365 | 10,504 | 6,070 | ||||||||||||||||
| Restructuring expenses | 700 | 824 | 2,006 | 2,886 | ||||||||||||||||
| Asset impairment charge and loss on divestiture, net | 3,862 | — | 102,140 | — | ||||||||||||||||
| Acquisition-related expenses | — | — | — | 123 | ||||||||||||||||
| Other | — | — | — | 2,500 | ||||||||||||||||
| Adjusted EBITDA | $ | 63,263 | $ | 55,624 | $ | 217,243 | $ | 184,803 | ||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
| Net cash provided by operating activities | $ | 43,878 | $ | 39,814 | $ | 160,098 | $ | 135,646 | ||||||||||||
| Interest paid | 6,226 | 4,650 | 37,979 | 35,029 | ||||||||||||||||
| Income and franchise taxes paid | 1,666 | 1,294 | 4,012 | 2,607 | ||||||||||||||||
|
Share-based compensation expense,
including restructuring expense | (3,001 | ) | (1,483 | ) | (10,867 | ) | (7,373 | ) | ||||||||||||
| Asset impairment charge and loss on divestiture, net | (3,862 | ) | — | (102,140 | ) | — | ||||||||||||||
| Gain on sale of rental fleet | 1,532 | 1,384 | 6,055 | 5,657 | ||||||||||||||||
|
Loss on disposal of property, plant and
equipment | (52 | ) | (45 | ) | (600 | ) | (517 | ) | ||||||||||||
|
Changes in certain assets and liabilities, net of
effect of businesses acquired | 9,313 | 7,821 | 8,056 | 2,175 | ||||||||||||||||
| EBITDA | $ | 55,700 | $ | 53,435 | $ | 102,593 | $ | 173,224 | ||||||||||||
| Mobile Mini, Inc. | ||||||||||||
| Free Cash Flow GAAP Reconciliation | ||||||||||||
| (Unaudited) | ||||||||||||
| (in thousands) | ||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||
| Net cash provided by operating activities | $ | 43,878 | $ | 39,814 | $ | 160,098 | $ | 135,646 | ||||
| Additions to rental fleet, excluding acquisitions | (20,341) | (17,743) | (85,961) | (63,688) | ||||||||
| Proceeds from sale of rental fleet | 3,546 | 3,351 | 14,993 | 12,953 | ||||||||
|
Additions to property, plant and equipment,
excluding acquisitions | (2,296) | (7,306) | (16,931) | (20,122) | ||||||||
|
Proceeds from sale of property, plant and
equipment | 80 | 71 | 683 | 851 | ||||||||
| Net capital expenditures, excluding acquisitions | (19,011) | (21,627) | (87,216) | (70,006) | ||||||||
| Free cash flow | $ | 24,867 | $ | 18,187 | $ | 72,882 | $ | 65,640 | ||||
Adjusted net income 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 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, respectively, divided by total revenues expressed as a percentage.
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.
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Contacts:
Chief Financial Officer
Mobile
Mini, Inc.
(602) 308-3879
www.mobilemini.com
INVESTOR
RELATIONS COUNSEL:
The Equity Group Inc.
Fred Buonocore
(212) 836-9607
Kevin Towle (212) 836-9620
