Mobile Mini : Reports Q3’15 Results and Announces Quarterly Dividend

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 specialty containment solutions in the United States, today reported actual and adjusted financial results for the quarter ended September 30, 2015. Total revenues were $133.3 million and rental revenues were $124.8 million, up from $113.3 million and $104.8 million, respectively, for the same period last year.

The Company recorded net income of $14.0 million, or $0.31 per diluted share in the third quarter of 2015 as compared to net income of $14.8 million, or $0.32 per diluted share, for the third quarter of 2014. On an adjusted basis, third quarter net income was $16.0 million, or $0.35 per diluted share, compared to adjusted net income of $15.2 million, or $0.33 per diluted share, for the third quarter of 2014. Adjusted EBITDA was $52.1 million and adjusted EBITDA margin was 39.5% for the third quarter of 2015.

Rental revenues for the portable storage and specialty containment businesses for the current quarter were $98.9 million and $26.0 million, respectively.

Dividend

The Company’s Board of Directors declared a cash dividend of 18.7 cents per share which will be paid on December 2, 2015 to shareholders of record on November 11, 2015.

Third Quarter 2015 Highlights

• Grew total rental revenues 19.1% year-over-year.
• Portable storage rental revenues increased 5.8%, excluding the wood mobile offices sold in May 2015, or 7.7% when adjusted for unfavorable currency fluctuations.
• Increased portable storage rental rates by 3.7% year-over-year.
• Expanded adjusted EBITDA margin to 39.5%, and delivered adjusted EBITDA of $52.1 million, up 17.3% from $44.4 million in the prior-year quarter.
• Drove portable storage utilization to an average of 70.0%; rising to 72.7% by quarter end.
• Returned $30.6 million to our shareholders through $8.3 million in dividends and $22.3 million of repurchased treasury shares in the quarter.

CEO Comments

Erik Olsson, Mobile Mini’s President and Chief Executive Officer, remarked, “I am very pleased with our performance overall and within both our individual portable storage and specialty containment businesses. Our portable storage business grew a strong 7.7% year-over-year, driven by increases in both units on rent and rental rates. The momentum we saw in the later part of the second quarter continued into the third quarter, with our North American sales force driving the highest number of quarterly portable storage activations in the Company’s history, with core activations up 12% from the third quarter 2014. As a result, utilization at the end of the quarter was a strong 72.7%. In our specialty containment business we continue to see good momentum in the downstream industrial segment and our overall specialty containment business generated $11 million of adjusted EBITDA at a robust 40.4% margin.”

Mr. Olsson continued, “We delivered a very good quarter, which included expanding our portable storage adjusted EBITDA margin to 39.3%, notwithstanding short-term pressure related to the divestiture of our wood mobile office business. Given our increasing utilization we also added to our sales force and made incremental growth capital expenditures for high demand markets. We continue to leverage our infrastructure across our two business segments, and are well-positioned for continued growth.”

Conference Call

Mobile Mini will host a conference call today, Thursday, October 22, 2015 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 Investors 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 209,500 portable storage containers and office units. Through its wholly-owned subsidiary, Evergreen Tank Solutions, Mobile Mini is also a leading provider of specialty containment solutions in the U.S., with a rental fleet of approximately 11,400 units. Mobile Mini’s network includes 133 portable storage locations in the U.S., United Kingdom, and Canada, 19 specialty containment locations and 6 combined locations. 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 expectations regarding ongoing momentum in certain segments, our ability to leverage our infrastructure and continued growth, 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 SEC filings. 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.

Reclassifications:

Certain amounts in the consolidated statements of operations for the three months ended March 31, 2015, which is included in the year-to-date period ended September 30, 2015, have been reclassified to conform to the current period presentation. The reclassifications have no effect on total revenues, loss from operations, net loss or net loss per common share.

The Company believes the current presentation better reflects the nature of the underlying financial statement items.

(See accompanying tables)

(1) Adjusted column excludes certain transactions described in the footnotes below that management believes are not indicative of its business. Adjusted figures are a non-GAAP presentation. See reconciliations herein, and additional information regarding non-GAAP financial information following in this earnings release.

(2) Adjustment is comprised of transition service revenue associated with the divestiture of our North American wood mobile office business.

(3) Adjustment in 2015 is comprised of $0.4 million in incremental costs related with acquisition activities, $2.2 million of operating expenses associated with the transition of the wood mobile offices, including expenses related to wood mobile offices on our leased properties, and $0.2 million of expense related to the proposed settlement of an unclaimed property liability with the state of Delaware.

(4) Costs relating to the restructuring of our business operations.

(1) Adjusted column excludes certain transactions described in the footnotes below that management believes are not indicative of its business. Adjusted figures are a non-GAAP presentation. See reconciliations herein, and additional information regarding non-GAAP financial information following in this earnings release.

(2) Adjustment is comprised of $2.9 million of transition service revenue associated with the divestiture of our North American wood mobile office business and $1.2 million of revenue associated with a sales tax refund that is not indicative of our ongoing business.

(3) Adjustment in 2015 is comprised of $2.4 million in incremental costs related with acquisition activities, $3.9 million of operating expenses associated with the transition of the wood mobile offices, including expenses related to wood mobile offices on our leased properties, and $0.8 million of expense related to the proposed settlement of an unclaimed property liability with the state of Delaware.

(4) Costs relating to the restructuring of our business operations.

(5) In 2015, asset impairment and loss on divestiture costs represent the impairment and loss associated with the divestiture of our North American wood mobile office business. In 2014, the asset impairment costs represent the additional loss upon completion of sale (offset by gains upon completion of sale) of assets that were written down to fair value in the second quarter of 2013.

(6) Common stock equivalents were excluded from the calculation of actual diluted earnings per share for the nine-month period ending September 30, 2015 because their inclusion would reduce the net loss per share.

(1) This table presents results by major business segment adjusted to exclude certain transactions that management believes are not indicative of its business. These adjustments are described in the notes to the condensed consolidated statements of income for the related periods presented earlier in this press release. Adjusted figures are a non-GAAP presentation. See additional information regarding non-GAAP financial information following in this earnings release.

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 Securities and Exchange Commission (“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:

(1) In 2015, impairment and divestiture-related revenues and expenses, net include the following: asset impairment charge and loss on divestiture, net, of $66.1 million for the nine-month period. In both the three and nine-month periods, this adjustment includes $1.5 million and $2.9 million, respectively, of transition services revenue and $2.2 million and $3.9 million, respectively, of operating expenses associated with the transition of the wood mobile offices, including the cost of providing yard space. In 2014, the asset impairment costs represent the additional loss upon completion of sale (offset by gains upon completion of sale) of assets that were written down to fair value in the second quarter of 2013.

(2) Revenue of $1.2 million associated with a sales tax refund recorded in the first quarter, partially offset by expenses related to the proposed settlement of an unclaimed property liability with the state of Delaware of $0.2 million and $0.8 million, for the three and nine-month periods, respectively. These transactions are not indicative of our ongoing business activity.

Adjusted net income information 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 that they provide 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 divided by total revenues expressed as a percentage. The GAAP financial measure that is most directly comparable to EBITDA margin is operating margin, which represents operating income divided by revenues.

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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