Date: July 24, 2008
Source: Stericycle, Inc.
Stericycle, Inc. (SRCL), today reported financial results for the second quarter of 2008. Revenues for the quarter ended June 30, 2008 were $277.8 million, up 19.3% from $232.8 million in the same quarter last year. Acquisitions less than 12 months old contributed approximately $18.0 million to the growth in revenues for the quarter. Gross profit was $123.2 million, up 17.8% from $104.5 million in the same quarter last year. Gross profit as a percent of revenue was 44.3% versus 44.9% in the second quarter of 2007.
Net income for the second quarter of 2008 was $38.7 million or $0.44 per diluted share compared with net income of $32.0 million or $0.36 per diluted share for the second quarter of 2007.
For the six months ended June 30, 2008, revenues were $532.6 million, up 20.0% from $443.9 million in the same period last year. Gross profit was $236.7 million, up 19.1% from $198.8 million in the same period last year. Gross profit as a percent of revenues was 44.5% versus 44.8% in the same period in 2007. Earnings per diluted share increased 16.2% to $0.79 from $0.68 per diluted share in the same period last year. Earnings per diluted share for the six months ended 2008 were negatively impacted by $0.04 per diluted share related to the arbitration settlement recorded in the first quarter of 2008.
Cash flow from operations was $94.6 million for the first six months of 2008. Cash flow and increased loan balances were used to strengthen our business and funded share repurchases, acquisitions and international investments, and capital expenditures.
For more information about Stericycle, please visit our website at www.stericycle.com.
Conference call to be held July 24, 2008 at 4:00 p.m. Central time - Dial 888-511-3669 at least 5 minutes before start time. If you are unable to participate on the call, a replay will be available through August 24th by dialing 800-642-1687, access code 52516618. To hear a live simulcast of the call over the internet on www.earnings.com, or to access an audio archive of the call, go to the Investors page on Stericycle's website at www.stericycle.com.
Safe Harbor Statement: Statements in this press release may contain forward-looking statements that involve risks and uncertainties, some of which are beyond our control (for example, general economic 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 medical waste collection and treatment and increases in transportation and other operating costs, as well as the other factors described in our filings with the U.S. Securities and Exchange Commission. 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
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE DATA)
June 30, December 31,
2008 2007
----------- ------------
(unaudited) (audited)
ASSETS
Current assets:
Cash and cash equivalents $ 12,395 $ 17,108
Short-term investments 1,128 1,256
Accounts receivable, less allowance for
doubtful accounts of $6,844 in 2008 and
$6,157 in 2007 173,267 157,435
Deferred income taxes 11,765 13,510
Other current assets 22,106 20,967
----------- ------------
Total current assets 220,661 210,276
Property, plant and equipment, net 202,773 193,039
Other assets:
Goodwill 1,093,499 1,033,333
Intangible assets, less accumulated
amortization of $12,989 in 2008 and
$12,230 in 2007 155,695 152,689
Other 19,272 18,822
----------- ------------
Total other assets 1,268,466 1,204,844
----------- ------------
Total assets $ 1,691,900 $ 1,608,159
=========== ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 29,118 $ 22,003
Accounts payable 33,349 40,049
Accrued liabilities 90,661 75,571
Deferred revenues 15,104 12,095
----------- ------------
Total current liabilities 168,232 149,718
----------- ------------
Long-term debt, net of current portion 706,853 613,781
Deferred income taxes 137,557 125,041
Other liabilities 4,706 5,544
Shareholders' equity:
Common stock (par value $0.01 per share,
120,000,000 shares authorized,
85,533,724 issued and outstanding in
2008, 87,410,653 issued and outstanding
in 2007) 855 874
Additional paid-in capital 87,889 197,462
Accumulated other comprehensive income 30,240 30,520
Retained earnings 555,568 485,219
----------- ------------
Total shareholders' equity 674,552 714,075
----------- ------------
Total liabilities and shareholders'
equity $ 1,691,900 $ 1,608,159
=========== ============
STERICYCLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE DATA)
Three Months Ended
June 30,
---------------------------------------------------
(unaudited)
---------------------------------------------------
2008 2007
$ % of Rev $ % of Rev
------------------------ -------------------------
Revenues $ 277,786 100.0% $ 232,845 100.0%
Cost of revenues 154,632 55.7% 128,328 55.1%
------------ ----------- ------------ ------------
Gross profit 123,154 44.3% 104,517 44.9%
Selling, general
and
administrative
expenses 50,973 18.3% 43,267 18.6%
Amortization 792 0.3% 882 0.4%
------------ ----------- ------------ ------------
Total SG&A
expense and
amortization 51,765 18.6% 44,149 19.0%
------------ ----------- ------------ ------------
Income from
operations
before
acquisition
integration and
other expenses 71,389 25.7% 60,368 25.9%
Gain on sale of
assets - 0.0% (1,075) -0.5%
Impairment of
fixed assets - 0.0% 611 0.3%
Impairment of
permit - 0.0% 228 0.1%
Arbitration
settlement and
related costs 147 0.1% - 0.0%
Acquisition
integration
expenses 316 0.1% 606 0.3%
------------ ----------- ------------ ------------
Income from
operations 70,926 25.5% 59,998 25.8%
Other income
(expense):
Interest
Income 157 0.1% 537 0.2%
Interest
expense (8,139) -2.9% (8,276) -3.6%
Insurance
proceeds - 0.0% - 0.0%
Other
expense, net (518) -0.2% (230) -0.1%
------------ ----------- ------------ ------------
Total other
income
(expense) (8,500) -3.1% (7,969) -3.4%
------------ ----------- ------------ ------------
Income before
income taxes 62,426 22.5% 52,029 22.3%
Income tax
expense 23,741 8.5% 20,031 8.6%
------------ ----------- ------------ ------------
Net income $ 38,685 13.9% $ 31,998 13.7%
============ =========== ============ ============
Earnings per
share-diluted $ 0.44 $ 0.36
============ ============
Weighted average
number of common
shares
outstanding-
diluted 88,484,943 89,956,735
============ ============
Six Months Ended
June 30,
---------------------------------------------------
(unaudited)
---------------------------------------------------
2008 2007
$ % of Rev $ % of Rev
------------------------ -------------------------
Revenues $ 532,570 100.0% $ 443,894 100.0%
Cost of revenues 295,826 55.5% 245,141 55.2%
------------ ----------- ------------ ------------
Gross profit 236,744 44.5% 198,753 44.8%
Selling, general
and
administrative
expenses 97,958 18.4% 81,046 18.3%
Amortization 1,844 0.3% 1,750 0.4%
------------ ----------- ------------ ------------
Total SG&A
expense and
amortization 99,802 18.7% 82,796 18.7%
------------ ----------- ------------ ------------
Income from
operations
before
acquisition
integration and
other expenses 136,942 25.7% 115,957 26.1%
Gain on sale of
assets - 0.0% (1,898) -0.4%
Impairment of
fixed assets - 0.0% 1,261 0.3%
Impairment of
permit - 0.0% 228 0.1%
Arbitration
settlement and
related costs 5,499 1.0% - 0.0%
Acquisition
integration
expenses 1,029 0.2% 919 0.2%
------------ ----------- ------------ ------------
Income from
operations 130,414 24.5% 115,447 26.0%
Other income
(expense):
Interest
Income 559 0.1% 938 0.2%
Interest
expense (16,267) -3.1% (15,976) -3.6%
Insurance
proceeds - 0.0% 500 0.1%
Other
expense, net (961) -0.2% (783) -0.2%
------------ ----------- ------------ ------------
Total other
income
(expense) (16,669) -3.1% (15,321) -3.5%
------------ ----------- ------------ ------------
Income before
income taxes 113,745 21.4% 100,126 22.6%
Income tax
expense 43,396 8.1% 38,741 8.7%
------------ ----------- ------------ ------------
Net income $ 70,349 13.2% $ 61,385 13.8%
============ =========== ============ ============
Earnings per
share-diluted $ 0.79 $ 0.68
============ ============
Weighted average
number of common
shares
outstanding-
diluted 88,944,593 90,203,819
============ ============
STERICYCLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
For the six months ended
June 30,
2008 2007
----------- ------------
(unaudited) (unaudited)
Operating Activities:
Net income $ 70,349 $ 61,385
Adjustments to reconcile net income to net
cash provided by operating activities:
Gain on sale of assets - (1,898)
Impairment of fixed assets - 1,261
Impairment of permit intangible - 228
Write-off of note receivable related to
joint venture 798 -
Stock compensation expense 5,987 5,074
Excess tax benefit of disqualifying
dispositions of stock options and
exercise of non-qualified stock options (4,523) (2,444)
Depreciation 14,793 13,096
Amortization 1,844 1,750
Deferred income taxes 11,222 8,189
Changes in operating assets and
liabilities, net of effect of
acquisitions:
Accounts receivable (9,304) (18,613)
Other assets (686) 1,913
Accounts payable (9,575) 4,755
Accrued liabilities 10,748 (6,584)
Deferred revenues 2,982 2,359
----------- ------------
Net cash provided by operating activities 94,635 70,471
----------- ------------
Investing Activities:
Payments for acquisitions and
international
investments, net of cash acquired (33,399) (51,529)
Proceeds from maturity of short-term
investments 129 1,948
Proceeds from sale of assets - 26,453
Proceeds from sale of property and
equipment - 124
Capital expenditures (22,977) (23,031)
----------- ------------
Net cash used in investing activities (56,247) (46,035)
----------- ------------
Financing Activities:
Repayment of long-term debt (3,760) (32,856)
Net borrowings on senior credit facility (29,700) 49,142
Proceeds from private placement of long-
term note 100,000 -
Payments of deferred financing costs (236) -
Principal payments on capital lease
obligations (199) (341)
Excess tax benefit of stock options
exercised 4,523 2,444
Purchase/cancellation of treasury stock (121,195) (58,661)
Proceeds from other issuances of common
stock 9,737 9,473
----------- ------------
Net cash used in financing activities (40,830) (30,799)
Effect of exchange rate changes on cash (2,271) (5,422)
----------- ------------
Net decrease in cash and cash equivalents (4,713) (11,785)
Cash and cash equivalents at beginning of
period 17,108 13,492
----------- ------------
Cash and cash equivalents at end of period $ 12,395 $ 1,707
=========== ============
Non-cash activities:
Net issuances of notes payable for certain
acquisitions $ 30,544 $ 37,215
Net issuances of common stock for certain
acquisitions 0 365
For more information, contact:
Stericycle, Inc.
Frank ten Brink
847-607-2012
Sign up to receive our free Weekly News Bulletin