Toggle SGML Header (+)


Section 1: 8-K (8-K)

srcl-8k_20190801.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): August 1, 2019

 

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)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.01 per share

SRCL

Nasdaq Global Select Market

 

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 14a-12 under the Exchange 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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 


Item 2.02    Results of Operations and Financial Condition

On August 1, 2019 Stericycle, Inc. issued a press release announcing its financial results for the quarter ended June 30, 2019.  A copy of this press release is attached hereto as Exhibit 99.1 and incorporated by reference.

This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Stericycle is making reference to non-GAAP financial measures in both the press release and the conference call.  A reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures is contained in the attached press release.

Item 9.01    Financial Statements and Exhibits

(d)

Exhibits

99.1

Press release issued by Stericycle, Inc. dated August 1, 2019


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: August 1, 2019

 

Stericycle, Inc.

 

 

 

 

By:

/s/ Janet H. Zelenka

 

 

 

 

 

Janet H. Zelenka

 

 

Executive Vice President and Chief Financial Officer

 

 

 

 

 

 

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

srcl-ex991_6.htm

EXHIBIT 99.1

FOR FURTHER INFORMATION CONTACT:

Stericycle Investor Relations 847-607-2012

 

Stericycle, Inc. Reports Results

For the Second Quarter 2019

 

LAKE FOREST, Ill., August 1, 2019 - Stericycle, Inc. (Nasdaq: SRCL) today reported results for the second quarter ended June 30, 2019 and updated guidance for the full year.

 

Revenues for the quarter were $845.8 million, a decrease of 4.2% from $883.3 million in the second quarter of last year.  Income from operations in the quarter was $25.3 million, compared to $62.4 million in the second quarter of last year. Net loss was $30.5 million, or $0.33 diluted loss per share, compared with net income of $26.6 million, or $0.31 diluted earnings per share, in the second quarter of last year.  Adjusted EBITDA was $137.7 million, or 16.3% of revenues, compared with $190.9 million, or 21.6% of revenues in the second quarter of last year.  Adjusted diluted earnings per share was $0.56, compared to $1.17 in the 2018 comparable period.

 

KEY BUSINESS HIGHLIGHTS:

 

Regulated Waste and Compliance Services (“RWCS”) grew organic revenues 1.4%, the first increase in two years.

 

Secure Information Destruction organic revenues, excluding sorted office paper (“SOP”), increased 4.3%.

 

The Company continued to make significant progress towards implementation of its global ERP system.

 

“We continue to make progress on key business priorities, including the development of our global ERP system and the overall transformation of the business,” said Cindy J. Miller, Chief Executive Officer. “We are encouraged by revenue growth in our core businesses this quarter which reflects the early impact of our quality of revenue initiatives. We were disappointed with our profitability, which was negatively affected by sorted office paper pricing and higher than expected costs.  Looking to the second half of 2019, we are acutely focused on key priorities to drive long-term growth and shareholder value.”

 

SECOND QUARTER FINANCIAL RESULTS

U.S. Generally Accepted Accounting Principles (GAAP) Results

 

Revenues for the quarter ended June 30, 2019 were $845.8 million, compared to $883.3 million in the second quarter of last year.  Macroeconomic factors, including the effect of foreign exchange rates and SOP pricing, reduced revenues by $20.6 million and $8.7 million, respectively.  Divestitures net of acquisitions reduced revenues by $10.6 million. Organic growth in Secure Information Destruction and RWCS was offset by lower SOP pricing and lower recall activity in Communication and Related Services.  


 

Income from operations in the quarter was $25.3 million, compared to $62.4 million in the second quarter of last year.  This variance was primarily due to the flow through of SOP pricing and pricing pressure in RWCS and higher operating costs which increased as a percent of revenue, including third-party hazardous waste disposal and equipment maintenance and rental costs. Selling, general and administrative (SG&A) expenses as a percent of revenue were slightly favorable.

 

Net loss was $30.5 million, or $0.33 diluted loss per share, compared with net income of $26.6 million, or $0.31 diluted earnings per share, in the second quarter of last year, primarily due to operational factors described above and a one-time pre-tax charge of $26.7 million related to loss on early extinguishment of debt and related charges from the debt refinancing in the second quarter.

 

Cash flow from operations year to date was $71.0 million, compared to $231.0 million during the same period last year.  The decrease was primarily a result of the net loss for the period and a change in net working capital.  Capital expenditures year to date were $108.2 million, including $40.8 million for the ERP implementation, compared to $64.0 million last year, including $3.7 million associated with the ERP implementation.

Non-GAAP Results

 

Adjusted EBITDA was $137.7 million, compared to $190.9 million in the second quarter of last year.  This variance was primarily driven by macroeconomic factors impacting revenues and higher operating costs, including third-party hazardous waste disposal and equipment maintenance and rental costs discussed above, and higher SG&A expenses which increased as a percent of revenues and were primarily driven by higher bad debt expense, internal control investments, and a one-time insurance reserve.

 

Adjusted diluted earnings per share was $0.56, compared to $1.17 in the second quarter of last year, primarily due to macroeconomic factors and operating costs, higher interest expense and the absence of gains on share repurchases this quarter as compared to the second quarter of 2018.

 

Free cash flow inclusive of capital expenditures was an outflow of ($37.2) million dollars as a result of the net loss for the period, the expected increase in capital expenditures due to the ERP implementation and a change in net working capital.

 

NON-GAAP FINANCIAL MEASURES

Actual Non-GAAP financial measures are reconciled to the most comparable GAAP measures in the schedules attached hereto.

 

FINANCIAL GUIDANCE

Stericycle updated its financial guidance for the full-year 2019, as summarized in the table below.  The revised guidance reflects the significant decline in SOP pricing, the impact of foreign exchange rates, higher interest expense, and continuing cost pressures. The Company’s guidance is based on currently known items and certain business assumptions including current foreign exchange rates and estimates for

2

 


SOP pricing.  The guidance only includes acquisitions and divestitures that closed through the second quarter of 2019.

(In millions, except per share data)

Revenues

$3,345 - $3,405

Adjusted EBITDA(1) (2)

$575-$615

Adjusted diluted earnings per share (2)

$2.50 to $2.85

Capital expenditures

$170 - $190

(1)

Adjusted Earnings Before Interest, Tax, Depreciation and Amortization (Adjusted EBITDA) is Income from operations excluding certain adjusting items, Depreciation and Intangible Amortization.

(2)

Guidance presented is on an Adjusted (non-GAAP) basis because it is not possible to predict or provide without unreasonable effort a reconciliation reflecting the impact of future acquisitions, divestitures, certain litigation, settlements and regulatory compliance matters, business transformation, intangible amortization, operational optimization, certain other items or the impact of highly inflationary accounting on operations in Argentina or other unanticipated events, which would be included in reported (U.S. GAAP) results and could be material.

 

CONFERENCE CALL INFORMATION

The Company is holding a conference call today, August 1, 2019, at 8:00 a.m. central time.  Dial (888) 317-6003 in the U.S., (866) 605-3851 in Canada, or (412) 317-6061 if outside the U.S./Canada at least 10 minutes before the call begins.  Upon dialing the number, you will be prompted to enter the Elite Entry number 4668043.  Presentation materials will be posted prior to the conference call at http://investors.stericycle.com.  To listen to the webcast via the Internet or access an audio replay of the call, visit the Company’s investor relations site at http://investors.stericycle.com.

 

ABOUT STERICYCLE

Stericycle, Inc., (Nasdaq: SRCL) is a U.S. based business-to-business services company and leading provider of compliance-based solutions that protect people and brands, promote health and safeguard the environment.  Stericycle serves more than one million customers in all 50 U.S. states and 20 countries worldwide with solutions for regulated waste management, secure information destruction, compliance, customer contact, and brand protection.  For more information about Stericycle, please visit www.stericycle.com.

 

3

 


SAFE HARBOR STATEMENT

This document may contain forward-looking statements.  When we use words such as "believes," "expects," "anticipates," "estimates" or similar expressions, we are making forward-looking statements.  Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of our management about future events and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements.  Factors that could cause such differences include, among others, SOP pricing volatility, foreign exchange rate volatility in the jurisdictions in which we operate, the volume and size of any recall events, 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, the level of government enforcement of regulations governing regulated waste collection and treatment or the proper handling and protection of personal and confidential information, decreases in the volume of regulated wastes or personal and confidential information collected from customers, the ability to implement our ERP system or execute on Business Transformation initiatives and achieve the anticipated benefits and cost savings, charges related to the portfolio rationalization strategy or the failure of this strategy to achieve the desired results, failure to consummate strategic alternative transactions with respect to non-core businesses, the obligations to service substantial indebtedness and comply with the covenants and restrictions contained in our credit agreements and notes, a downgrade in our credit rating resulting in an increase in interest expense, political, economic, inflationary and other risks related to our foreign operations, the outcome of pending or future litigation or investigations including with respect to the U.S. Foreign Corrupt Practices Act, changing market conditions in the healthcare industry, competition and demand for services in the regulated waste and secure information destruction industries, failure to maintain an effective system of internal control over financial reporting, delays or failures in implementing remediation efforts with respect to existing or future material weaknesses, disruptions in or attacks on information technology systems, as well as other factors described in our filings with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K and subsequent Quarterly Reports on Forms 10-Q.  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 disclaim any obligation to update or revise any forward-looking or other statements contained herein other than in accordance with legal and regulatory obligations.

 

 

4

 


STERICYCLE, INC.

 

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME

 

(In millions, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2019

 

2018

 

% Change

 

 

2019

 

2018

 

% Change

 

Revenues

$

845.8

 

$

883.3

 

 

(4.2

%)

 

$

1,675.9

 

$

1,778.3

 

 

(5.8

%)

Cost of revenues

 

543.2

 

 

530.0

 

 

2.5

%

 

 

1,076.2

 

 

1,066.5

 

 

0.9

%

Gross profit

 

302.6

 

 

353.3

 

 

(14.4

%)

 

 

599.7

 

 

711.8

 

 

(15.7

%)

Selling, general and administrative expenses

 

277.3

 

 

290.9

 

 

(4.7

%)

 

 

557.7

 

 

595.3

 

 

(6.3

%)

Goodwill impairment

 

-

 

 

-

 

nm

 

 

 

20.9

 

 

-

 

nm

 

Income from operations

 

25.3

 

 

62.4

 

 

(59.5

%)

 

 

21.1

 

 

116.5

 

 

(81.9

%)

Interest expense, net

 

(33.6

)

 

(24.6

)

 

36.6

%

 

 

(61.2

)

 

(49.6

)

 

23.4

%

Loss on early extinguishment of debt

 

(23.1

)

 

-

 

nm

 

 

 

(23.1

)

 

-

 

nm

 

Other expense, net

 

(1.8

)

 

(0.6

)

nm

 

 

 

(4.0

)

 

(0.6

)

nm

 

(Loss) income before income taxes

 

(33.2

)

 

37.2

 

 

(189.2

%)

 

 

(67.2

)

 

66.3

 

 

(201.4

%)

Income tax benefit (expense)

 

3.0

 

 

(9.6

)

 

(131.3

%)

 

 

(0.6

)

 

(16.2

)

 

(96.3

%)

Net (loss) income

 

(30.2

)

 

27.6

 

 

(209.4

%)

 

 

(67.8

)

 

50.1

 

 

(235.3

%)

Net (income) loss attributable to noncontrolling interests

 

(0.3

)

 

0.1

 

nm

 

 

 

(0.5

)

 

0.1

 

nm

 

Net (loss) income attributable to Stericycle, Inc.

 

(30.5

)

 

27.7

 

 

(210.1

%)

 

 

(68.3

)

 

50.2

 

 

(236.1

%)

Mandatory convertible preferred stock dividend

 

-

 

 

(8.3

)

 

(100.0

%)

 

 

-

 

 

(17.1

)

 

(100.0

%)

Gain on repurchase of preferred stock

 

-

 

 

7.2

 

 

(100.0

%)

 

 

-

 

 

14.5

 

 

(100.0

%)

Net (loss) income attributable to Stericycle, Inc. common shareholders

$

(30.5

)

$

26.6

 

 

(214.7

%)

 

$

(68.3

)

$

47.6

 

 

(243.5

%)

(Loss) earnings per common share attributable to Stericycle, Inc. common shareholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(0.33

)

$

0.31

 

 

(206.5

%)

 

$

(0.75

)

$

0.56

 

 

(233.9

%)

Diluted

$

(0.33

)

$

0.31

 

 

(206.5

%)

 

$

(0.75

)

$

0.55

 

 

(236.4

%)

Weighted average number of common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

91.0

 

 

85.6

 

 

 

 

 

 

90.9

 

 

85.6

 

 

 

 

Diluted

 

91.0

 

 

85.8

 

 

 

 

 

 

90.9

 

 

85.8

 

 

 

 

 

 

 

nm - percentage change not meaningful

 

 

5

 


STATISTICS - U.S. GAAP AND ADJUSTED MEASURES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

 

 

% of Revenue

 

 

 

 

 

% of Revenue

 

 

 

 

 

% of Revenue

 

 

 

 

 

% of Revenue

 

Statistics  - U.S. GAAP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

$

302.6

 

 

35.8

%

 

$

353.3

 

 

40.0

%

 

$

599.7

 

 

35.8

%

 

$

711.8

 

 

40.0

%

Selling, general and administrative expenses

$

277.3

 

 

32.8

%

 

$

290.9

 

 

32.9

%

 

$

557.7

 

 

33.3

%

 

$

595.3

 

 

33.5

%

Income from operations

$

25.3

 

 

3.0

%

 

$

62.4

 

 

7.1

%

 

$

21.1

 

 

1.3

%

 

$

116.5

 

 

6.6

%

Effective tax rate

 

9.0

%

 

 

 

 

 

25.8

%

 

 

 

 

 

(0.9

%)

 

 

 

 

 

24.4

%

 

 

 

Statistics - Adjusted (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted gross profit

$

304.8

 

 

36.0

%

 

$

353.3

 

 

40.0

%

 

$

605.5

 

 

36.1

%

 

$

711.8

 

 

40.0

%

Adjusted selling, general and administrative expenses

$

199.2

 

 

23.6

%

 

$

195.1

 

 

22.1

%

 

$

394.9

 

 

23.6

%

 

$

395.1

 

 

22.2

%

Adjusted income from operations

$

105.6

 

 

12.5

%

 

$

158.2

 

 

17.9

%

 

$

210.6

 

 

12.6

%

 

$

316.7

 

 

17.8

%

Depreciation - cost of revenues

$

26.4

 

 

3.1

%

 

$

26.0

 

 

2.9

%

 

$

52.3

 

 

3.1

%

 

$

50.2

 

 

2.8

%

Depreciation - selling, general and administrative expenses

$

6.5

 

 

0.8

%

 

$

6.7

 

 

0.8

%

 

$

12.4

 

 

0.7

%

 

$

13.3

 

 

0.7

%

Intangible amortization

$

36.9

 

 

4.4

%

 

$

32.9

 

 

3.7

%

 

$

74.7

 

 

4.5

%

 

$

64.8

 

 

3.6

%

EBITDA

$

95.1

 

 

11.2

%

 

$

128.0

 

 

14.5

%

 

$

160.5

 

 

9.6

%

 

$

244.8

 

 

13.8

%

Adjusted EBITDA

$

137.7

 

 

16.3

%

 

$

190.9

 

 

21.6

%

 

$

274.5

 

 

16.4

%

 

$

380.2

 

 

21.4

%

Adjusted net income attributable to common shareholders

$

51.2

 

 

6.1

%

 

$

106.1

 

 

12.0

%

 

$

102.8

 

 

6.1

%

 

$

216.2

 

 

12.2

%

Adjusted effective tax rate

 

30.6

%

 

 

 

 

 

25.7

%

 

 

 

 

 

31.4

%

 

 

 

 

 

25.1

%

 

 

 

Adjusted diluted earnings per share

$

0.56

 

 

 

 

 

$

1.17

 

 

 

 

 

$

1.13

 

 

 

 

 

$

2.39

 

 

 

 

Adjusted diluted shares outstanding (2018 using if-converted method)

 

91.1

 

 

 

 

 

 

90.5

 

 

 

 

 

 

91.0

 

 

 

 

 

 

90.6

 

 

 

 

 

(1)

Adjusted financial measures are Non-GAAP measures and exclude adjusting items as described and reconciled to comparable U.S. GAAP financial measures in the Reconciliation of U.S. GAAP to Non-GAAP Financial Measures contained in this Press Release.

 

 

6

 


STERICYCLE, INC.

 

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

 

(In millions)

 

 

 

 

 

 

 

 

 

 

June 30,

 

 

December 31,

 

 

2019

 

 

2018

 

ASSETS

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

Cash and cash equivalents

$

34.5

 

 

$

34.3

 

Accounts receivable, net

 

613.7

 

 

 

599.6

 

Prepaid expenses

 

97.8

 

 

 

50.0

 

Other current assets

 

73.1

 

 

 

63.4

 

Total Current Assets

 

819.1

 

 

 

747.3

 

Property, plant and equipment, net

 

786.2

 

 

 

743.5

 

Operating lease right-of-use assets

 

393.2

 

 

 

-

 

Goodwill

 

3,195.1

 

 

 

3,222.2

 

Intangible assets, net

 

1,562.8

 

 

 

1,637.7

 

Other assets

 

113.3

 

 

 

104.8

 

Total Assets

$

6,869.7

 

 

$

6,455.5

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

Current portion of long-term debt

$

117.3

 

 

$

104.3

 

Bank overdrafts

 

2.2

 

 

 

14.8

 

Accounts payable

 

229.4

 

 

 

225.8

 

Accrued liabilities

 

303.8

 

 

 

340.8

 

Operating lease liabilities

 

89.5

 

 

 

-

 

Other current liabilities

 

42.0

 

 

 

47.5

 

Total Current Liabilities

 

784.2

 

 

 

733.2

 

 

 

 

 

 

 

 

 

Long-term debt, net

 

2,697.2

 

 

 

2,663.9

 

Long-term operating lease liabilities

 

317.2

 

 

 

-

 

Deferred income taxes

 

360.2

 

 

 

307.3

 

Long-term taxes payable

 

76.1

 

 

 

83.3

 

Other liabilities

 

72.6

 

 

 

70.7

 

Total Liabilities

 

4,307.5

 

 

 

3,858.4

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

Common stock

 

0.9

 

 

 

0.9

 

Additional paid-in capital

 

1,192.8

 

 

 

1,162.6

 

Retained earnings

 

1,720.9

 

 

 

1,789.2

 

Accumulated other comprehensive loss

 

(356.6

)

 

 

(365.3

)

Total Stericycle, Inc.’s Equity

 

2,558.0

 

 

 

2,587.4

 

Noncontrolling interests

 

4.2

 

 

 

9.7

 

Total Equity

 

2,562.2

 

 

 

2,597.1

 

Total Liabilities and Equity

$

6,869.7

 

 

$

6,455.5

 

 

 

7

 


STERICYCLE, INC.

 

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(In millions)

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30,

 

 

2019

 

 

2018

 

OPERATING ACTIVITIES:

 

 

 

 

 

 

 

Net (loss) income

$

(67.8

)

 

$

50.1

 

Adjustments to reconcile net (loss) income to net cash from operating activities:

 

 

 

 

 

 

 

Depreciation

 

64.7

 

 

 

63.5

 

Intangible amortization

 

74.7

 

 

 

64.8

 

Loss on early extinguishment of debt and related charges

 

26.5

 

 

 

 

 

Stock-based compensation expense

 

10.0

 

 

 

12.8

 

Deferred income taxes

 

12.8

 

 

 

(13.6

)

Goodwill and other impairment charges and gains on divestiture of businesses, net

 

23.7

 

 

 

18.9

 

Other, net

 

0.9

 

 

 

(1.5

)

Changes in operating assets and liabilities, net of the effect of acquisitions and divestitures:

 

 

 

 

 

 

 

Accounts receivable

 

(14.0

)

 

 

(23.5

)

Prepaid expenses

 

(22.4

)

 

 

(2.6

)

Accounts payable

 

3.6

 

 

 

13.8

 

Accrued liabilities

 

(50.6

)

 

 

39.2

 

Other assets and liabilities

 

8.9

 

 

 

9.1

 

Net cash from operating activities

 

71.0

 

 

 

231.0

 

INVESTING ACTIVITIES:

 

 

 

 

 

 

 

Capital expenditures

 

(108.2

)

 

 

(64.0

)

Payments for acquisitions, net of cash acquired

 

(0.3

)

 

 

(29.0

)

Proceeds from divestiture of businesses

 

13.6

 

 

 

8.2

 

Other, net

 

1.8

 

 

 

1.4

 

Net cash from investing activities

 

(93.1

)

 

 

(83.4

)

FINANCING ACTIVITIES:

 

 

 

 

 

 

 

Repayments of long-term debt and other obligations

 

(21.1

)

 

 

(29.8

)

Net proceeds from (repayments of) foreign bank debt

 

4.5

 

 

 

(4.7

)

Proceeds from Term Loan

 

365.0

 

 

 

-

 

Repayments of Term Loan

 

(23.8

)

 

 

(23.8

)

Proceeds from issuance of Senior Notes

 

600.0

 

 

 

-

 

Net proceeds from (repayments of) Senior Credit Facility

 

202.4

 

 

 

(59.3

)

Repayments of private placement notes

 

(1,075.0

)

 

 

-

 

Payments on early extinguishment of debt

 

(20.4

)

 

 

-

 

(Repayments of) proceeds from bank overdrafts, net

 

(12.1

)

 

 

0.2

 

Payments of capital lease obligations

 

(1.3

)

 

 

(2.7

)

Payments of debt issuance costs

 

(8.8

)

 

 

-

 

Proceeds from issuance of common stock, net of shares withheld for tax

 

13.9

 

 

 

8.8

 

Payments for repurchase of mandatory convertible preferred stock

 

-

 

 

 

(14.8

)

Dividends paid on mandatory convertible preferred stock

 

-

 

 

 

(17.1

)

Net cash from financing activities

 

23.3

 

 

 

(143.2

)

Effect of exchange rate changes on cash and cash equivalents

 

(1.0

)

 

 

(1.6

)

Net change in cash and cash equivalents

 

0.2

 

 

 

2.8

 

Cash and cash equivalents at beginning of period

 

34.3

 

 

 

42.2

 

Cash and cash equivalents at end of period

$

34.5

 

 

$

45.0

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL CASH FLOW INFORMATION:

 

 

 

 

 

 

 

Net issuances of obligations for acquisitions

$

0.3

 

 

$

21.7

 

Capital expenditures in accounts payable

$

30.6

 

 

$

5.5

 

Interest paid during the period, net of capitalized interest

$

48.8

 

 

$

42.5

 

Income taxes paid during the period, net of refunds

$

6.5

 

 

$

18.4

 

Free cash flow (1)

$

(37.2

)

 

$

167.0

 

 

(1)

Free cash flow is calculated as Net cash flow from operating activities less Capital expenditures.

8

 


Table 1 – A: REVENUES CHANGES BY SERVICE AND GEOGRAPHY

THREE MONTHS ENDED JUNE 30, 2019

 

Three Months Ended June 30,

 

 

In millions

 

 

 

 

Components of  Change (%)

 

 

2019

 

2018

 

Change ($)

 

Change (%)

 

Organic

 

 

Acquisitions

 

Divestitures

 

Foreign Exchange(3)

 

Revenues by Service

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulated Waste and Compliance Services (1)

$

475.0

 

$

483.8

 

$

(8.8

)

 

(1.8

%)

 

1.4

%

 

 

0.1

%

 

(0.5

%)

 

(2.8

%)

Secure Information Destruction Services

 

229.4

 

 

230.0

 

 

(0.6

)

 

(0.3

%)

 

0.5

%

(4)

 

0.3

%

 

 

 

(1.1

%)

Communication and Related Services (2)

 

63.2

 

 

81.3

 

 

(18.1

)

 

(22.2

%)

 

(16.7

%)

 

 

 

 

(5.0

%)

 

(0.5

%)

Manufacturing and Industrial Services

 

78.2

 

 

88.2

 

 

(10.0

)

 

(11.3

%)

 

(0.7

%)

 

 

 

 

(5.7

%)

 

(4.9

%)

Total Revenues

$

845.8

 

$

883.3

 

$

(37.5

)

 

(4.2

%)

 

(0.8

%)

 

 

0.1

%

 

(1.3

%)

 

(2.2

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues by Geography

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic and Canada

$

700.4

 

$

711.7

 

$

(11.3

)

 

(1.6

%)

 

(1.2

%)

(5)

 

0.2

%

 

(0.4

%)

 

(0.2

%)

International

 

145.4

 

 

171.6

 

 

(26.2

)

 

(15.3

%)

 

1.1

%

 

 

 

 

(5.3

%)

 

(11.1

%)

Total Revenues

$

845.8

 

$

883.3

 

$

(37.5

)

 

(4.2

%)

 

(0.8

%)

 

 

0.1

%

 

(1.3

%)

 

(2.2

%)

 

See footnote descriptions below Table 1 – C.

 

Table 1 – B: REVENUES CHANGES BY SERVICE AND GEOGRAPHY –

SIX MONTHS ENDED JUNE 30, 2019

 

Six Months Ended June 30,

 

 

In millions

 

 

 

 

Components of Change (%)

 

 

2019

 

2018

 

Change ($)

 

Change (%)

 

Organic

 

 

Acquisitions

 

Divestitures

 

Foreign Exchange(3)

 

Revenues by Service

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulated Waste and Compliance Services (1)

$

944.2

 

$

981.2

 

$

(37.0

)

 

(3.8

%)

 

(0.3

%)

 

 

0.1

%

 

(0.5

%)

 

(3.1

%)

Secure Information Destruction Services

 

461.4

 

 

449.9

 

 

11.5

 

 

2.6

%

 

2.4

%

(6)

 

1.5

%

 

 

 

(1.3

%)

Communication and Related Services (2)

 

124.4

 

 

173.2

 

 

(48.8

)

 

(28.2

%)

 

(24.0

%)

 

 

 

 

(3.5

%)

 

(0.7

%)

Manufacturing and Industrial Services

 

145.9

 

 

174.0

 

 

(28.1

)

 

(16.2

%)

 

(4.0

%)

 

 

 

 

(7.3

%)

 

(4.9

%)

Total Revenues

$

1,675.9

 

$

1,778.3

 

$

(102.4

)

 

(5.8

%)

 

(2.3

%)

 

 

0.4

%

 

(1.3

%)

 

(2.6

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues by Geography

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic and Canada

$

1,379.2

 

$

1,426.4

 

$

(47.2

)

 

(3.3

%)

 

(3.3

%)

(7)

 

0.6

%

 

(0.3

%)

 

(0.3

%)

International

 

296.7

 

 

351.9

 

 

(55.2

)

 

(15.7

%)

 

1.6

%

 

 

 

 

(5.3

%)

 

(12.0

%)

Total Revenues

$

1,675.9

 

$

1,778.3

 

$

(102.4