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Section 1: 8-K (8-K)

srcl-8k_20161027.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

Current Report

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 27, 2016

 

 

 

Stericycle, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

 

 

 

 

 

Delaware

 

1-37556

 

36-3640402

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification Number)

28161 North Keith Drive

Lake Forest, Illinois 60045

(Address of principal executive offices including zip code)

(847) 367-5910

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

    Written communications pursuant to Rule 425 under the Securities Act (17 CR 230.425)

    Soliciting material pursuant to Rule 425 under the Securities Act (17 CFR 240.14a-12)

    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 


Item 2.02    Results of Operations and Financial Condition

On October 27, 2016 Stericycle, Inc. issued a press release announcing its financial results for the quarter ended September 30, 2016. A copy of this press release is attached hereto as Exhibit 99.1 and incorporated by reference.

Item 9.01    Financial Statements and Exhibits

(d)

Exhibits

99.1

Press release issued by Stericycle, Inc. dated October 27, 2016.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

 

 

 

 Dated: October 27, 2016

 

Stericycle, Inc.

 

 

 

 

By:

/s/ DANIEL V. GINNETTI

 

 

 

 

 

Daniel V. Ginnetti

 

 

Executive Vice President and Chief Financial Officer

 

 

 

 


EXHIBIT INDEX

Exhibit Number

Description

99.1

Press Release issued by Stericycle, Inc. dated October 27, 2016.

 

 

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

srcl-ex991_6.htm

EXHIBIT 99.1

FOR FURTHER INFORMATION CONTACT:

Investor Relations 847-607-2012

STERICYCLE, INC. REPORTS RESULTS

FOR THE THIRD QUARTER AND YEAR TO DATE 2016

Lake Forest, Illinois, October 27, 2016—Stericycle, Inc. (NASDAQ:SRCL), today reported financial results for the third quarter and year to date 2016.

THIRD QUARTER HIGHLIGHTS COMPARED TO PRIOR YEAR:

 

Revenues of $890.1 million, up 23.9%, including a 2.5% negative impact from foreign exchange

 

GAAP gross profit of $379.3 million, up 26.6%

 

GAAP EPS decreased 11.1% to $0.72 and Non-GAAP EPS increased 7.8% to $1.24

THIRD QUARTER RESULTS

Revenues for the quarter ended September 30, 2016 were $890.1 million, up 23.9% from $718.6 million in the third quarter of last year. Acquisitions contributed approximately $184.7 million to the current period’s growth in revenues.  Revenues increased 26.4% compared to the third quarter of last year when adjusted for unfavorable foreign exchange impacts of $18.3 million. Organic revenues grew 0.7%, or 1.6% when adjusted for manufacturing and industrial services. See Tables 1A-1C.

Gross profit, reported in accordance with U.S. generally accepted accounting principles (“GAAP”), was $379.3 million, up 26.6% from $299.7 million in the third quarter of last year.  GAAP gross profit as a percentage of revenue was 42.6% compared to 41.7% in the third quarter of last year. Non-GAAP gross profit, when adjusted for contract exit costs and plant conversion expenses as identified in Table 2, was $381.0 million, an increase of 26.9% from $300.2 million in the third quarter of last year. Non-GAAP gross profit as a percentage of revenues was 42.8% compared to 41.8% in the third quarter of last year.

“We were able to maintain consistent margin performance in the quarter despite revenue headwinds from previously discussed pricing pressure and softness in the manufacturing and industrial market,” said Charlie Alutto, President and Chief Executive Officer.

GAAP earnings per diluted share decreased 11.1% to $0.72 from $0.81 in the third quarter of last year. Non-GAAP earnings per diluted share, when adjusted for various items, increased 7.8% to $1.24 from $1.15 in the third quarter of last year. See Tables 3 and 4.

“Our record free cash flow in the quarter allowed us to accelerate our capital allocation strategy, contributing to our EPS growth,” said Dan Ginnetti, Chief Financial Officer. “We were able to significantly reduce our debt by approximately $100 million, repurchase 265,000 of mandatory convertible preferred stock, and close five acquisitions.” 

NINE MONTHS HIGHLIGHTS COMPARED TO PRIOR YEAR:

 

Revenues of $2.66 billion, up 26.6%, including a 3.0% negative impact from foreign exchange

 

GAAP gross profit of $1.13 billion, up 27.5%

 

GAAP EPS decreased 10.6% to $1.93 and Non-GAAP EPS increased 1.7% to $3.53

FIRST NINE MONTHS RESULTS

Revenues for the nine months ended September 30, 2016 were $2.66 billion, up 26.6% from $2.10 billion in the same period last year. Acquisitions contributed approximately $565.1 million to the current year’s growth in revenues. Revenues increased 29.6% compared to the same period last year when adjusted for unfavorable foreign exchange impact of $62.1 million. Organic revenues grew 2.6%, or 3.9% when adjusted for manufacturing and industrial services. See Tables 1A-1C.

GAAP gross profit was $1.13 billion, up 27.5% from $885.8 million in the same period last year. GAAP gross profit as a percentage of revenues was 42.5% compared to 42.2% in the same period last year. Non-GAAP gross profit, when adjusted for contract exit costs and plant conversion expenses as identified in Table 2, was $1.13 billion, up 27.6% from


$886.8 million in the same period as last year. Non-GAAP gross profit as a percentage of revenues was 42.6% compared to 42.3% in the same period last year.

GAAP earnings per diluted share decreased 10.6% to $1.93 from $2.16 in the same period last year. Non-GAAP earnings per diluted share, when adjusted for various items, increased 1.7% to $3.53 from $3.47 in the same period last year. See Tables 3 and 4.

Cash flow from operations for the nine months ended September 30, 2016 was $417.8 million, up 42.4% from $293.3 million in the same period last year.

CONFERENCE CALL INFORMATION

Conference call to be held October 27, 2016 4:00 p.m. Central time – Dial 866-516-6872 at least 5 minutes before start time. If you are unable to participate on the call, a replay will be available through November 27th by dialing 855-859-2056, access code 21518012. To hear a live simulcast of the call or access the audio archive, visit the investor relations page on www.stericycle.com.

PRESENTATION OF NON-GAAP INFORMATION

This press release includes certain non-GAAP financial measures, as defined in the SEC’s Regulation G. The Company reports its financial results in compliance with GAAP, but believes that also discussing non-GAAP financial measures allows for a better period over period comparison by removing the impact of items that, in management’s view, do not reflect the Company’s underlying operating performance. These measures are also used to evaluate senior management and are a factor in determining their at-risk compensation.

Adjusted diluted earnings per share, adjusted net income, adjusted gross profit, and adjusted sales growth are described in the Reconciliation of Certain Non-GAAP Measures section of this document.

These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial results, but should be read in conjunction with the unaudited condensed consolidated statement of income and other information presented herein. The non-GAAP financial measures in the press release may differ from similar measures used by other companies. A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP measure is included in the accompanying tables.

DISCUSSION OF ADJUSTING ITEMS FOR NON-GAAP MEASURES

For the purpose of evaluating revenues, we present non-GAAP revenues to show the impact of foreign currency, revenues from acquisitions and Manufacturing and Industrial Services (“M&I”). Management reviews and analyzes revenues excluding the effect of foreign currency translation and revenue from acquisitions because we believe this better represents the Company’s underlying business trends, including organic revenue growth. Separate presentation of M&I allows for visibility of a revenue stream that has shown greater volatility than our other service lines.

For the purpose of evaluating operating performance, we present our financials to show the impact of income and expenses in our non-GAAP earnings related to acquisitions. These adjustments include acquisition expense, integration expense, amortization expense, and the change in fair value of contingent consideration. This allows for comparison of period over period results without the impact of acquisition-related expenses.

For the purpose of evaluating operating performance, we additionally present our financials to show the impact of certain expenses and income in our non-GAAP earnings to allow for period over period comparison of financials without the impact of charges that may not occur each year and if so, are due to different factors. For the periods presented, these adjustments include litigation expense, restructuring and plant conversion expenses, contract exit costs, and insurance proceeds.

For the purpose of calculating the ultimate impact of our mandatory convertible preferred stock, we show the impact to our EPS by excluding the mandatory convertible preferred stock dividend and using the “if-converted” method of share dilution. This provides the reader insight to how our diluted shares will be affected after these preferred shares are converted to common shares.

 



RECONCILIATION OF CERTAIN NON-GAAP MEASURES

 

Table 1 – A: RECONCILIATION OF GAAP TO NON-GAAP REVENUE GROWTH – QTD Q3

 

 

Three Months Ended September 30, 2016 and 2015

 

 

In millions

 

 

Percentage Growth (%)

 

Global Revenue Details by Service

2016

 

 

 

 

2015

 

 

Growth

 

 

Organic

 

Acquisitions

 

Foreign Exchange

 

Total

 

Regulated Waste and Compliance Services

$

520.4

 

 

 

 

$

521.0

 

 

$

(0.6

)

 

 

1.7

%

 

0.4

%

 

(2.2

%)

 

(0.1

%)

Secure Information Destruction Services

 

187.1

 

 

 

 

 

-

 

 

 

187.1

 

 

N/A

 

N/A

 

N/A

 

N/A

 

Communication and Related Services

 

87.5

 

 

 

 

 

93.2

 

 

 

(5.7

)

 

 

(5.5

%)

 

0.8

%

 

(1.4

%)

 

(6.1

%)

Manufacturing and Industrial Services

 

95.2

 

 

 

 

 

104.5

 

 

 

(9.3

)

 

 

(4.4

%)

 

0.8

%

 

(5.2

%)

 

(8.9

%)

Total Revenues, as Reported

 

890.1

 

 

 

 

 

718.6

 

 

 

171.5

 

 

 

0.7

%

 

25.7

%

 

(2.5

%)

 

23.9

%

Less: Manufacturing and Industrial Services

 

(95.2

)

 

 

 

 

(104.5

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenues, as Adjusted (Non-GAAP)

$

795.0

 

 

 

 

$

614.1

 

 

$

180.8

 

 

 

1.6

%

 

29.9

%

 

(2.1

%)

 

29.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic Revenues

$

664.1

 

 

 

 

$

523.5

 

 

$

140.6

 

 

 

(0.1

%)

 

27.0

%

 

 

 

26.9

%

International Revenues

 

226.1

 

 

 

 

 

195.1

 

 

 

31.0

 

 

 

3.0

%

 

22.3

%

 

(9.4

%)

 

15.9

%

Total Revenues, as Reported

$

890.1

 

 

 

 

$

718.6

 

 

$

171.5

 

 

 

0.7

%

 

25.7

%

 

(2.5

%)

 

23.9

%

 

 

Table 1 – B: RECONCILIATION OF GAAP TO NON-GAAP REVENUE GROWTH – YTD Q3

 

 

Nine Months Ended September 30, 2016 and 2015

 

 

In millions

 

 

Percentage Growth (%)

 

Global Revenue Details by Service

2016

 

 

 

 

2015

 

 

Growth

 

 

Organic

 

Acquisitions

 

Foreign Exchange

 

Total

 

Regulated Waste and Compliance Services

$

1,550.3

 

 

 

 

$

1,544.6

 

 

$

5.7

 

 

 

2.5

%

 

0.6

%

 

(2.7

%)

 

0.4

%

Secure Information Destruction Services

 

562.3

 

 

 

 

 

-

 

 

 

562.3

 

 

N/A

 

N/A

 

N/A

 

N/A

 

Communication and Related Services

 

258.0

 

 

 

 

 

247.6

 

 

 

10.4

 

 

 

3.2

%

 

2.4

%

 

(1.4

%)

 

4.2

%

Manufacturing and Industrial Services

 

285.4

 

 

 

 

 

305.4

 

 

 

(20.0

)

 

 

(4.5

%)

 

3.4

%

 

(5.5

%)

 

(6.5

%)

Total Revenues, as Reported

 

2,655.9

 

 

 

 

 

2,097.6

 

 

 

558.3

 

 

 

2.6

%

 

26.9

%

 

(3.0

%)

 

26.6

%

Less: Manufacturing and Industrial Services

 

(285.4

)

 

 

 

 

(305.4

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenues, as Adjusted (Non-GAAP)

$

2,370.5

 

 

 

 

$

1,792.2

 

 

$

578.3

 

 

 

3.9

%

 

30.9

%

 

(2.5

%)

 

32.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic Revenues

$

1,970.9

 

 

 

 

$

1,513.9

 

 

$

456.9

 

 

 

1.8

%

 

28.4

%

 

 

 

30.2

%

International Revenues

 

685.1

 

 

 

 

 

583.7

 

 

 

101.4

 

 

 

5.0

%

 

23.0

%

 

(10.6

%)

 

17.4

%

Total Revenues, as Reported

$

2,655.9

 

 

 

 

$

2,097.6

 

 

$

558.3

 

 

 

2.6

%

 

26.9

%

 

(3.0

%)

 

26.6

%

 

 

Table 1 – C: DISAGGREGATED REVENUE GROWTH – 2016

 

In millions

 

 

Three Months Ended

September 30, 2016

 

 

 

 

Nine Months Ended September 30, 2016

 

Organic

$

5.1

 

 

 

 

$

55.3

 

Acquisitions

 

184.7

 

 

 

 

 

565.1

 

Foreign Exchange

 

(18.3

)

 

 

 

 

(62.1

)

Total Growth

$

171.5

 

 

 

 

$

558.3

 

 



Table 2: RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT

 

In millions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

 

$

 

% of Rev

 

 

$

 

% of Rev

 

 

$

 

% of Rev

 

 

$

 

% of Rev

 

Gross Profit, as Reported

$

379.3

 

 

42.6

%

 

$

299.7

 

 

41.7

%

 

$

1,129.5

 

 

42.5

%

 

$

885.8

 

 

42.2

%

Contract exit costs

 

1.7

 

 

0.2

%

 

 

-

 

 

0.0

%

 

 

1.7

 

 

0.1

%

 

 

-

 

 

0.0

%

Plant Conversion Expenses

 

(0.0

)

 

0.0

%

 

 

0.5

 

 

0.1

%

 

 

0.8

 

 

0.0

%

 

 

1.0

 

 

0.0

%

Gross Profit, as Adjusted (Non-GAAP)

$

381.0

 

 

42.8

%

 

$

300.2

 

 

41.8

%

 

$

1,132.0

 

 

42.6

%

 

$

886.8

 

 

42.3

%

 

Table 3: RECONCILIATION OF GAAP TO NON-GAAP NET INCOME ATTRIBUTABLE TO STERICYCLE COMMON SHAREHOLDERS

 

In millions, except share and per share data

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2016

 

2015

 

 

2016

 

2015

 

Net Income Attributable to Stericycle, Inc. Common Shareholders, As Reported

$

61.5

 

$

69.4

 

 

$

165.5

 

$

186.2

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition Expenses

 

2.3

 

 

33.7

 

 

 

7.9

 

 

39.9

 

Integration Expenses

 

19.2

 

 

13.4

 

 

 

61.0

 

 

31.2

 

Litigation Expenses

 

1.5

 

 

(16.4

)

 

 

5.4

 

 

59.0

 

Changes in Fair Value of Contingent Consideration

 

0.6

 

 

-

 

 

 

(2.1

)

 

(0.6

)

Restructuring and Plant Conversion Expenses

 

0.5

 

 

2.7

 

 

 

1.7

 

 

18.1

 

Contract Exit Costs

 

10.1

 

 

-

 

 

 

22.8

 

 

-

 

Insurance Proceeds

 

(3.1

)

 

-

 

 

 

(3.1

)

 

-

 

Amortization Expense a

 

33.1

 

 

9.2

 

 

 

102.3

 

 

27.0

 

Add Back Convertible Preferred Stock Dividend

 

9.7

 

 

-

 

 

 

29.9

 

 

-

 

Total Adjustments

 

73.9

 

 

42.6

 

 

 

225.8

 

 

174.6

 

Tax Effect of above adjustments b

 

(22.6

)

 

(12.2

)

 

 

(69.4

)

 

(60.3

)

Net Income Attributable to Stericycle, Inc. Common Shareholders, as Adjusted (Non-GAAP)

$

112.8

 

$

99.8

 

 

$

321.9

 

$

300.5

 

EPS, as Reported

$

0.72

 

$

0.81

 

 

$

1.93

 

$

2.16

 

EPS, as Adjusted (Non-GAAP)

$

1.24

 

$

1.15

 

 

$

3.53

 

$

3.47

 

Weighted average number of common shares outstanding - diluted

 

85,570,529

 

 

86,120,315

 

 

 

85,689,525

 

 

86,234,859

 

Additional Dilution Under If-Converted Method

 

5,495,861

 

 

-

 

 

 

5,590,105

 

 

-

 

Diluted Weighted Average Number of Common Shares Outstanding Under If-Converted Method

 

91,066,390

 

 

86,120,315

 

 

 

91,279,630

 

 

86,234,859

 

 

 

 

a)

Beginning in the quarter ended March 31, 2016, the Company has started to exclude amortization expense from non-GAAP EPS. For comparable reporting, the Company’s previously reported 2015 results are adjusted to reflect the change.

 

b)

The tax effect of the adjustments is calculated based on applying the appropriate tax rate for the jurisdictions in which the adjustment occurred for the respective periods.



Table 4: RECONCILIATION OF GAAP TO NON-GAAP EPS

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

 

 

 

 

 

 

 

Change

 

 

 

 

 

 

 

 

 

 

Change

 

 

2016

 

 

2015

 

 

$

 

%

 

 

2016

 

 

2015

 

 

$

 

%

 

EPS, as Reported

$

0.72

 

 

$

0.81

 

 

$

(0.09

)

 

-11.1

%

 

$

1.93

 

 

$

2.16

 

 

$

(0.23

)

 

-10.6

%

Acquisition Expenses

 

0.02

 

 

 

0.27

 

 

 

 

 

 

 

 

 

 

0.06

 

 

 

0.33

 

 

 

 

 

 

 

 

Integration Expenses

 

0.14

 

 

 

0.10

 

 

 

 

 

 

 

 

 

 

0.45

 

 

 

0.23

 

 

 

 

 

 

 

 

Litigation Expenses

 

0.01

 

 

 

(0.12

)

 

 

 

 

 

 

 

 

 

0.04

 

 

 

0.41

 

 

 

 

 

 

 

 

Changes in Fair Value of Contingent Consideration

 

0.01

 

 

 

0.00

 

 

 

 

 

 

 

 

 

 

(0.02

)

 

 

(0.01

)

 

 

 

 

 

 

 

Restructuring and Plant Conversion Expenses

 

0.00

 

 

 

0.02

 

 

 

 

 

 

 

 

 

 

0.01

 

 

 

0.14

 

 

 

 

 

 

 

 

Contract Exit Costs

 

0.10

 

 

 

0.00

 

 

 

 

 

 

 

 

 

 

0.20

 

 

 

0.00

 

 

 

 

 

 

 

 

Insurance Proceeds

 

(0.04

)

 

 

0.00

 

 

 

 

 

 

 

 

 

 

(0.03

)

 

 

0.00

 

 

 

 

 

 

 

 

Amortization Expense

 

0.25

 

 

 

0.07

 

 

 

 

 

 

 

 

 

 

0.77

 

 

 

0.21

 

 

 

 

 

 

 

 

Add Back Convertible Preferred Stock Dividend

 

0.11

 

 

 

0.00

 

 

 

 

 

 

 

 

 

 

0.35

 

 

 

0.00

 

 

 

 

 

 

 

 

Total Impact of All Adjustments Including Convertible Preferred Stock Dividend

 

(0.08

)

 

 

0.00

 

 

 

 

 

 

 

 

 

 

(0.23

)

 

 

0.00

 

 

 

 

 

 

 

 

EPS, as Adjusted (Non-GAAP)

$

1.24

 

 

$

1.15

 

 

$

0.09

 

 

7.8

%

 

$

3.53

 

 

$

3.47

 

 

$

0.06

 

 

1.7

%

Diluted Weighted Average Number of Common Shares Outstanding Under If-Converted Method

 

91,066,390

 

 

 

86,120,315

 

 

 

 

 

 

 

 

 

 

91,279,630

 

 

 

86,234,859

 

 

 

 

 

 

 

 

 

For more information about Stericycle, please visit our website at www.stericycle.com.

Safe Harbor Statement: This press release may contain forward-looking statements that involve risks and uncertainties, some of which are beyond our control (for example, general economic and market conditions). Our actual results could differ significantly from the results described in the forward-looking statements. Factors that could cause such differences include changes in governmental regulation of the collection, transportation, treatment and disposal of regulated waste or the proper handling and protection of personal and confidential information, increases in transportation and other operating costs, the level of governmental enforcement of regulations governing regulated waste collection and treatment or the proper handling and protection of personal and confidential information, our obligations to service our substantial indebtedness and to comply with the covenants and restrictions contained in our private placement notes, term loan credit facility and revolving credit facility, our ability to execute our acquisition strategy and to integrate acquired businesses, competition and demand for services in the regulated waste and secure information destruction industries, political, economic and currency risks related to our foreign operations, impairments of goodwill or other indefinite-lived intangibles, variability in the demand for services we provide on a project or non-recurring basis, exposure to environmental liabilities, fluctuations in the price we receive for the sale of paper, disruptions in or attacks on our information technology systems, compliance with existing and future legal and regulatory requirements, as well as other factors described in our filings with the U.S. Securities and Exchange Commission, including our most recently filed Annual Report on Form 10-K. As a result, past financial performance should not be considered a reliable indicator of future performance, and investors should not use historical trends to anticipate future results or trends. We make no commitment to disclose any subsequent revisions to forward-looking statements.

 



STERICYCLE, INC. AND SUBSIDIARIES

 

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

 

(IN THOUSANDS)

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

December 31,

 

 

2016

 

 

2015

 

ASSETS

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

Cash and cash equivalents

$

40,291

 

 

$

55,634

 

Short-term investments

 

63

 

 

 

69

 

Accounts receivable, net

 

637,921

 

 

 

614,494

 

Prepaid expenses

 

52,134

 

 

 

46,740

 

Other current assets

 

43,529

 

 

 

44,891

 

Total Current Assets

 

773,938

 

 

 

761,828

 

Property, plant and equipment, net

 

738,106

 

 

 

665,602

 

Goodwill

 

3,597,034

 

 

 

3,758,177

 

Intangible assets, net

 

1,926,974

 

 

 

1,842,561

 

Other assets

 

31,544

 

 

 

36,995

 

Total Assets

$

7,067,596

 

 

$

7,065,163

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

Current portion of long-term debt

$

91,008

 

 

$

161,409

 

Accounts payable

 

146,400

 

 

 

149,202

 

Accrued liabilities

 

211,762

 

 

 

197,329

 

Deferred revenues

 

15,536

 

 

 

16,989

 

Other current liabilities

 

73,021

 

 

 

62,420

 

Total Current Liabilities

 

537,727

 

 

 

587,349

 

 

 

 

 

 

 

 

 

Long-term debt, net of current portion

 

2,921,770

 

 

 

3,040,352

 

Deferred income taxes

 

654,495

 

 

 

608,272

 

Other liabilities

 

84,483

 

 

 

81,352

 

Equity:

 

 

 

 

 

 

 

Mandatory convertible preferred stock

 

7

 

 

 

8

 

Common stock

 

851

 

 

 

849

 

Additional paid-in capital

 

1,167,756

 

 

 

1,143,020

 

Accumulated other comprehensive loss

 

(304,168

)

 

 

(282,631

)

Retained earnings

 

1,993,343

 

 

 

1,868,645

 

Total Stericycle, Inc. Equity

 

2,857,789

 

 

 

2,729,891

 

Noncontrolling interests

 

11,332

 

 

 

17,947

 

Total Equity

 

2,869,121

 

 

 

2,747,838

 

Total Liabilities and Equity

$

7,067,596

 

 

$

7,065,163

 

 

 


STERICYCLE, INC. AND SUBSIDIARIES

 

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

 

(IN THOUSANDS, EXCEPT SHARES AND PER SHARE DATA)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

 

$

 

% of Rev

 

 

$

 

% of Rev

 

 

$

 

% of Rev

 

 

$

 

% of Rev

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

$

890,144

 

 

100.0

%

 

$

718,596

 

 

100.0

%

 

$

2,655,946

 

 

100.0

%

 

$

2,097,604

 

 

100.0

%

Cost of revenues ("COR") exclusive of depreciation

 

488,154

 

 

54.8

%

 

 

404,918

 

 

56.3

%

 

 

1,457,425

 

 

54.9

%

 

 

1,169,051

 

 

55.7

%

Depreciation

 

22,730

 

 

2.6

%

 

 

14,003

 

 

1.9

%

 

 

68,982

 

 

2.6

%

 

 

42,723

 

 

2.0

%

Total cost of revenues

 

510,884

 

 

57.4

%

 

 

418,921

 

 

58.3

%

 

 

1,526,407

 

 

57.5

%

 

 

1,211,774

 

 

57.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit, as reported

 

379,260

 

 

42.6

%

 

 

299,675

 

 

41.7

%

 

 

1,129,539

 

 

42.5

%

 

 

885,830

 

 

42.2

%

Gross profit, as adjusted (non-GAAP)

 

380,982

 

 

42.8

%

 

 

300,162

 

 

41.8

%

 

 

1,132,014

 

 

42.6

%

 

 

886,831

 

 

42.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses ("SG&A")

  exclusive of depreciation

 

245,245

 

 

27.6

%

 

 

166,671

 

 

23.2

%

 

 

739,294

 

 

27.8

%

 

 

536,004

 

 

25.6

%

Depreciation

 

9,498

 

 

1.1

%

 

 

4,248

 

 

0.6

%

 

 

25,097

 

 

0.9

%

 

 

12,753

 

 

0.6

%

Total SG&A expense, as reported

 

254,743

 

 

28.6

%

 

 

170,919

 

 

23.8

%

 

 

764,391

 

 

28.8

%

 

 

548,757

 

 

26.2

%

Total SG&A expense, as adjusted (non-GAAP)

 

189,269

 

 

21.3

%

 

 

128,769

 

 

17.9

%

 

 

567,846

 

 

21.4

%

 

 

375,141

 

 

17.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations, as reported

 

124,517

 

 

14.0

%

 

 

128,756

 

 

17.9

%

 

 

365,148

 

 

13.7

%

 

 

337,073

 

 

16.1

%

Income from operations, as adjusted (non-GAAP)

  exclusive of adjusting items shown below

 

191,713

 

 

21.5

%

 

 

171,393

 

 

23.9

%

 

 

564,168

 

 

21.2

%

 

 

511,690

 

 

24.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusting items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contract exit costs (COR)

 

1,715