STERCYCLE : Stericycle, Inc. Reports Results for First Quarter 2011
04/27/2011| 04:05pm US/Eastern
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Stericycle, Inc. (NASDAQ:SRCL), today reported financial results
for the first quarter of 2011.
Revenues for the quarter ended March 31, 2011 were $398.1 million, up
18.8% from $335.2 million in the same quarter last year. Acquisitions
less than 12 months old contributed approximately $30.6 million to the
growth in revenues for the quarter. Revenues increased 18.1% compared to
the first quarter of 2010 when adjusted for favorable foreign exchange
impacts in the first quarter of 2011 of $2.3 million. Gross profit was
$182.4 million, up 17.5% from $155.3 million in the first quarter last
year. Gross profit as a percent of revenue was 45.8% compared with 46.3%
in the first quarter of 2010.
Net income attributable to Stericycle for the first quarter of 2011 was
$55.7 million or $0.64 per diluted share compared with $48.1 million or
$0.56 per diluted share for the first quarter of 2010. Net income
attributable to Stericycle for the first quarter of 2011 included the
effect of $3.8 million of after-tax acquisition expenses and $0.2
million of after-tax restructuring costs, and net income for the first
quarter of 2010 included the effect of $0.7 million of after-tax
acquisition expenses and $0.4 million of after-tax restructuring costs.
Adjusted for these charges, non-GAAP earnings per diluted share
increased to $0.68 in the first quarter of 2011 from $0.57 in the first
quarter of 2010 or up 19.8% (see table below).
Table to reconcile GAAP EPS to non-GAAP EPS*
Three months ended March 31,
2011
2010
Change $
Change %
GAAP EPS
$0.64
$0.56
$0.08
14.4%
Acquisition expenses/Restructuring costs
0.05
0.01
Non-GAAP EPS (adjusted)
$0.68
$0.57
$0.11
19.8%
* In accordance with U.S. generally accepted accounting principles
(GAAP), reported earnings per share include the after-tax impact of the
items identified in this table. For internal purposes, including the
determination of management compensation, the Company excludes these
items from results when evaluating operating performance. This table and
the Company's internal use of non-GAAP earnings per share are not
intended to imply, and should not be interpreted as implying, that
non-GAAP earnings per share is a better measure of performance than GAAP
earnings per share.
Cash flow from operations was $65.6 million for the first quarter of
2011.
For more information about Stericycle, please visit our 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.
Conference call to be held April 27, 2011 at 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
May 27th by dialing 800-642-1687, access code 55174056. 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.
STERICYCLE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE DATA)
March 31,
December 31,
2011
2010
(unaudited)
(audited)
ASSETS
Current Assets:
Cash and cash equivalents
$
24,656
$
77,053
Short-term investments
19,768
18,471
Accounts receivable, less allowance for doubtful
accounts of $9,916 in 2011 and $10,845 in 2010
231,171
215,420
Deferred income taxes
15,408
16,824
Prepaid expenses
21,448
16,038
Other current assets
25,212
24,882
Total Current Assets
337,663
368,688
Property, plant and equipment, net
272,593
267,971
Other assets:
Goodwill
1,616,504
1,595,764
Intangible assets, less accumulated amortization of
$31,991 in 2011 and $28,394 in 2010
388,812
375,174
Other
28,065
31,426
Total other assets
2,033,381
2,002,364
Total Assets
$
2,643,637
$
2,639,023
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt
$
83,516
$
88,899
Accounts payable
56,120
54,777
Accrued liabilities
127,623
134,711
Deferred revenues
14,679
14,455
Other current liabilities
10,307
15,647
Total Current Liabilities
292,245
308,489
Long-term debt, net of current portion
921,554
1,014,222
Deferred income taxes
241,096
222,647
Other liabilities - long-term
10,735
13,315
Shareholders' Equity:
Common stock (par value $0.01 per share, 120,000,000 shares
authorized of which 85,702,145 were issued and outstanding in 2011
and 85,242,387 issued outstanding in 2010)
857
852
Additional paid-in capital
75,146
46,945
Accumulated other comprehensive income/ (loss)
(3,931
)
(16,869
)
Retained earnings
1,073,171
1,017,497
Total Stericycle, Inc. Shareholders' Equity
1,145,243
1,048,425
Noncontrolling interest
32,764
31,925
Total Shareholders' Equity
1,178,007
1,080,350
Total Liabilities and Shareholders' Equity
$
2,643,637
$
2,639,023
STERICYCLE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE DATA)
Three Months Ended
March 31,
2011
2010
(unaudited)
$
% of Rev
$
% of Rev
Revenues
$
398,126
100.0
%
$
335,177
100.0
%
Cost of revenues
215,634
54.2
%
179,432
53.5
%
Restructuring Costs
62
0.0
%
428
0.1
%
Gross profit
182,430
45.8
%
155,317
46.3
%
Selling, general and administrative expenses
71,910
18.1
%
64,022
19.1
%
Amortization
3,347
0.8
%
1,975
0.6
%
Total SG&A expense and amortization
75,257
18.9
%
65,997
19.7
%
Income from operations before
acquisition, integration, and other expenses
107,173
26.9
%
89,320
26.6
%
Acquisition expenses
3,798
1.0
%
800
0.2
%
Restructuring costs
196
0.0
%
239
0.1
%
Integration expenses
766
0.2
%
1,149
0.3
%
Income from operations
102,413
25.7
%
87,132
26.0
%
Other income (expense):
Interest income
184
0.0
%
80
0.0
%
Interest expense
(11,372
)
-2.9
%
(8,963
)
-2.7
%
Other expense, net
(263
)
-0.1
%
(1,003
)
-0.3
%
Total other income (expense)
(11,451
)
-2.9
%
(9,886
)
-2.9
%
Income before income taxes
90,962
22.8
%
77,246
23.0
%
Income tax expense
34,376
8.6
%
28,612
8.5
%
Net income
56,586
14.2
%
48,634
14.5
%
Net income attributable to
noncontrolling interests
912
0.2
%
515
0.2
%
Net income attributable to Stericycle, Inc.
$
55,674
14.0
%
$
48,119
14.4
%
Earnings per share-diluted
$
0.64
$
0.56
Weighted average number of
common shares outstanding-diluted
87,526,683
86,573,237
STERICYCLE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
Three Months Ended
March 31,
2011
2010
(unaudited)
(unaudited)
Operating Activities:
Net income
$
56,586
$
48,634
Adjustments to reconcile net income to net cash
provided by operating activities:
Stock compensation expense
3,863
3,874
Excess tax benefit of stock options exercised
(8,092
)
(1,163
)
Depreciation
11,756
10,414
Amortization
3,347
1,975
Deferred income taxes
16,051
13,784
Changes in operating assets and liabilities, net of
effect of acquisitions:
Accounts receivable
(11,615
)
(7,932
)
Accounts payable
(433
)
(3,522
)
Accrued liabilities
(1,341
)
15,601
Deferred revenues
(34
)
1,611
Other assets and liabilities
(4,503
)
(2,221
)
Net cash provided by operating activities
65,585
81,055
Investing Activities:
Payments for acquisitions and international
investments, net of cash acquired
(19,543
)
(50,459
)
Purchases of short-term investments
(1,240
)
(423
)
Proceeds from sale of property and equipment
389
-
Capital expenditures
(11,692
)
(12,804
)
Net cash used in investing activities
(32,086
)
(63,686
)
Financing Activities:
Repayment of long-term debt
(24,563
)
(27,533
)
Net (repayments)/ borrowings on senior credit facility
(86,044
)
24,873
Purchase/cancellation of treasury stock
-
(10,616
)
Proceeds from other issuances of common stock
14,811
4,195
Excess tax benefit of stock options exercised
8,092
1,163
Net cash used in financing activities
(87,704
)
(7,918
)
Effect of exchange rate changes on cash
1,808
(2,332
)
Net (decrease)/ increase in cash and cash equivalents
(52,397
)
7,119
Cash and cash equivalents at beginning of period
77,053
15,767
Cash and cash equivalents at end of period
$
24,656
$
22,886
Non-cash activities:
Net issuances of notes payable for certain acquisitions
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