Mobile Mini Reports Q2 2019 Results and Announces Quarterly Dividend

PHOENIX--()--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 tank and pump solutions in the United States, today reported actual and adjusted financial results for the quarter ended June 30, 2019.

Total revenues were $150.2 million and rental revenues were $141.9 million, as compared to $142.0 million and $132.9 million, respectively, for the same period last year. Rental revenues for the Storage Solutions and Tank & Pump Solutions businesses for the current quarter were $110.4 million and $31.5 million, respectively, compared to $105.8 million and $27.1 million, respectively, for the same period last year.

The Company realized net income of $14.1 million, or $0.31 per diluted share, in the second quarter of 2019. On an adjusted basis, second quarter net income was $18.2 million, or $0.41 per diluted share, as compared to adjusted net income of $15.9 million, or $0.35 per diluted share, for the second quarter of 2018. Adjusted EBITDA was $56.9 million and adjusted EBITDA margin was 37.9% for the second quarter of 2019.

Dividend

The Company’s Board of Directors declared a cash dividend of 27.5 cents per share, which will be paid on August 28, 2019 to shareholders of record as of August 14, 2019.

Second Quarter 2019 Highlights

  • Continued strong rental revenue growth in Tank & Pump Solutions (“T&P”) with a 16.3% year-over-year increase.
  • Drove healthy North American Storage Solutions (“SS”) rental revenue year-over-year growth of 7.1%.
  • Delivered year-over-year rate growth of 3.4% in SS and a mid-single digit increase for T&P.
  • Achieved strong average OEC utilization rates of 76.4% for SS and 73.5% for T&P.
  • Grew adjusted EBITDA 13.8%, year-over-year, and expanded adjusted EBITDA margin by 270 basis points to 37.9%.
  • Generated robust free cash flow of $38.7 million, an increase of $27.0 million year-over-year.
  • Increased return on capital employed to 9.5% as of June 30, 2019, which exceeds weighted average cost of capital and is a 190 basis point improvement from June 30, 2018.
  • Decreased leverage ratio to 3.8x as of June 30, 2019 from 4.2x as of December 31, 2018.

CEO Comments

Erik Olsson, Mobile Mini’s Chief Executive Officer, remarked, “The strong performance in the second quarter reflects the continued momentum we have created over the last several quarters by executing on our strategy from the solid platform we have built. In addition to very strong margin expansion we saw robust growth in revenues, adjusted EBITDA, and importantly, free cash flow. Especially notable is the continued strong rental revenue growth in our Tank & Pump segment, driven by both volume and rate, and as we continue to demonstrate our value proposition, we believe we will continue to grow this business with existing and new large customers. Our Storage Solutions business remains strong, driven by rate increases and healthy levels of demand in North America, where solid pending orders indicate healthy growth in the back half of the year. The cycle is still in our favor and our outlook remains very positive for the remainder of 2019.”

Mr. Olsson continued, “I am pleased to be transitioning into my role as Chairman of the Board following a record year in 2018 and another strong year well underway. Mobile Mini is a very different company than when I first joined. Today our strategy is to profitably grow our business by offering customers high quality products and services in two segments: containers and tanks. Because of our unmatched quality and service in these areas, we are able to command premium pricing, which improves both revenues and margins. We invest in long-lived steel-centric products with minimal maintenance requirements and short pay-back periods and drive sustainable growth by partnering with large customers across many industries that recognize the value of our unique scale and technology solutions. Combining this strategy with a culture of continuous improvement to drive operational efficiencies, we deliver shareholder value through strong cash flows and great returns. Our fundamentals today are very strong and I would like to personally thank the employees of Mobile Mini for their consistent dedication and hard work during this time.”

Conference Call

Mobile Mini will host a conference call later today, July 25th at 5 pm 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 Investor Relations 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 198,000 storage solutions containers and office units and a leading provider of tank and pump solutions in the U.S., with a rental fleet of approximately 12,700 units. Mobile Mini’s network is comprised of 155 locations in the U.S., U.K., and Canada. 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 ability to grow our business with existing and new customers, as well as our ability to achieve healthy growth in the second half of the year, all of 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 filings with the Securities and Exchange Commission (“SEC”). 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.

(See accompanying tables)

Mobile Mini, Inc.

 

Condensed Consolidated Statements of Income

 

(Unaudited)

 

(in thousands, except percentages and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2019

 

 

Three Months Ended June 30, 2018

 

 

 

Actual

 

 

Adjustments

 

 

Adjusted (1)

 

 

Actual

 

 

Adjustments

 

 

Adjusted (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

$

141,906

 

 

$

 

 

$

141,906

 

 

$

132,887

 

 

$

 

 

$

132,887

 

Sales

 

 

8,135

 

 

 

 

 

 

8,135

 

 

 

8,881

 

 

 

 

 

 

8,881

 

Other

 

 

140

 

 

 

 

 

 

140

 

 

 

231

 

 

 

 

 

 

231

 

Total revenues

 

 

150,181

 

 

 

 

 

 

150,181

 

 

 

141,999

 

 

 

 

 

 

141,999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental, selling and general expenses

 

 

95,735

 

 

 

(4,332

)

 

 

91,403

 

 

 

89,271

 

 

 

 

 

 

89,271

 

Cost of sales

 

 

5,044

 

 

 

 

 

 

5,044

 

 

 

5,764

 

 

 

 

 

 

5,764

 

Restructuring expenses

 

 

 

 

 

 

 

 

 

 

 

1,195

 

 

 

(1,195

)

 

 

 

Depreciation and amortization

 

 

18,135

 

 

 

 

 

 

18,135

 

 

 

17,192

 

 

 

 

 

 

17,192

 

Total costs and expenses

 

 

118,914

 

 

 

(4,332

)

 

 

114,582

 

 

 

113,422

 

 

 

(1,195

)

 

 

112,227

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

31,267

 

 

 

4,332

 

 

 

35,599

 

 

 

28,577

 

 

 

1,195

 

 

 

29,772

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(10,592

)

 

 

 

 

 

(10,592

)

 

 

(10,093

)

 

 

 

 

 

(10,093

)

Foreign currency exchange

 

 

(167

)

 

 

 

 

 

(167

)

 

 

(21

)

 

 

 

 

 

(21

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax provision

 

 

20,508

 

 

 

4,332

 

 

 

24,840

 

 

 

18,463

 

 

 

1,195

 

 

 

19,658

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

6,450

 

 

 

185

 

 

 

6,635

 

 

 

3,463

 

 

 

300

 

 

 

3,763

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

14,058

 

 

$

4,147

 

 

$

18,205

 

 

$

15,000

 

 

$

895

 

 

$

15,895

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA/Adjusted EBITDA

 

$

49,235

 

 

 

 

 

 

$

56,907

 

 

$

45,748

 

 

 

 

 

 

$

49,987

 

EBITDA/Adjusted EBITDA as a percentage of

total revenues

 

 

32.8

%

 

 

 

 

 

 

37.9

%

 

 

32.2

%

 

 

 

 

 

 

35.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.32

 

 

 

 

 

 

$

0.41

 

 

$

0.34

 

 

 

 

 

 

$

0.36

 

Diluted

 

 

0.31

 

 

 

 

 

 

 

0.41

 

 

 

0.33

 

 

 

 

 

 

 

0.35

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common and

common share equivalents outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

44,496

 

 

 

 

 

 

 

44,496

 

 

 

44,287

 

 

 

 

 

 

 

44,287

 

Diluted

 

 

44,750

 

 

 

 

 

 

 

44,750

 

 

 

45,091

 

 

 

 

 

 

 

45,091

 

 

(1)

Adjusted column for the three months ended June 30, 2019 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the three-month period ended June 30, 2019 include the following:
  • Reduction of rental, selling and general expenses to exclude $3.6 million of non-cash share-based compensation related to transition agreements for our Chief Executive Officer who is retiring as an employee of the Company and assuming the position of Chairman of the Board.
  • Reduction of rental, selling and general expenses to exclude $0.7 million of expenses related to potential acquisitions, along with the related tax effect.

(2)

Adjusted column for the three months ended June 30, 2018 excludes costs of $1.2 million related to restructuring that management believes are not indicative of our business, along with the related tax effects. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release.

Mobile Mini, Inc.

 

Condensed Consolidated Statements of Income

 

(Unaudited)

 

(in thousands, except percentages and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2019

 

 

Six Months Ended June 30, 2018

 

 

 

Actual

 

 

Adjustments

 

 

Adjusted (1)

 

 

Actual

 

 

Adjustments

 

 

Adjusted (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

$

284,078

 

 

$

 

 

$

284,078

 

 

$

265,225

 

 

$

 

 

$

265,225

 

Sales

 

 

15,358

 

 

 

 

 

 

15,358

 

 

 

16,984

 

 

 

 

 

 

16,984

 

Other

 

 

406

 

 

 

 

 

 

406

 

 

 

444

 

 

 

 

 

 

444

 

Total revenues

 

 

299,842

 

 

 

 

 

 

299,842

 

 

 

282,653

 

 

 

 

 

 

282,653

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental, selling and general expenses

 

 

187,969

 

 

 

(4,332

)

 

 

183,637

 

 

 

178,269

 

 

 

 

 

 

178,269

 

Cost of sales

 

 

9,646

 

 

 

 

 

 

9,646

 

 

 

11,155

 

 

 

 

 

 

11,155

 

Restructuring expenses

 

 

 

 

 

 

 

 

 

 

 

1,306

 

 

 

(1,306

)

 

 

 

Depreciation and amortization

 

 

35,470

 

 

 

 

 

 

35,470

 

 

 

34,015

 

 

 

 

 

 

34,015

 

Total costs and expenses

 

 

233,085

 

 

 

(4,332

)

 

 

228,753

 

 

 

224,745

 

 

 

(1,306

)

 

 

223,439

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

66,757

 

 

 

4,332

 

 

 

71,089

 

 

 

57,908

 

 

 

1,306

 

 

 

59,214

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

 

 

 

 

 

 

 

 

 

6

 

 

 

 

 

 

6

 

Interest expense

 

 

(21,352

)

 

 

 

 

 

(21,352

)

 

 

(19,692

)

 

 

 

 

 

(19,692

)

Deferred financing costs write-off

 

 

(123

)

 

 

123

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency exchange

 

 

(166

)

 

 

 

 

 

(166

)

 

 

45

 

 

 

 

 

 

45

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax provision

 

 

45,116

 

 

 

4,455

 

 

 

49,571

 

 

 

38,267

 

 

 

1,306

 

 

 

39,573

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

12,973

 

 

 

217

 

 

 

13,190

 

 

 

8,412

 

 

 

328

 

 

 

8,740

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

32,143

 

 

$

4,238

 

 

$

36,381

 

 

$

29,855

 

 

$

978

 

 

$

30,833

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA/Adjusted EBITDA

 

$

102,061

 

 

 

 

 

 

$

113,137

 

 

$

91,974

 

 

 

 

 

 

$

98,553

 

EBITDA/Adjusted EBITDA as a percentage of

total revenues

 

 

34.0

%

 

 

 

 

 

 

37.7

%

 

 

32.5

%

 

 

 

 

 

 

34.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.72

 

 

 

 

 

 

$

0.82

 

 

$

0.67

 

 

 

 

 

 

$

0.70

 

Diluted

 

 

0.72

 

 

 

 

 

 

 

0.81

 

 

 

0.66

 

 

 

 

 

 

 

0.69

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common and

common share equivalents outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

44,472

 

 

 

 

 

 

 

44,472

 

 

 

44,251

 

 

 

 

 

 

 

44,251

 

Diluted

 

 

44,814

 

 

 

 

 

 

 

44,814

 

 

 

44,967

 

 

 

 

 

 

 

44,967

 

(1)

Adjusted column for the six months ended June 30, 2019 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the six-month period ended June 30, 2019 include the following:

  • Reduction of rental, selling and general expenses to exclude $3.6 million of non-cash share-based compensation related to transition agreements for our Chief Executive Officer who is retiring as an employee of the Company and assuming the position of Chairman of the Board.
  • Reduction of rental, selling and general expenses to exclude $0.7 million of expenses related to potential acquisitions, along with the related tax effect.

  • Exclusion of $0.1 million of deferred financing costs that were written off in conjunction with the amendment of our lines of credit.

(2)

Adjusted column for the six months ended June 30, 2018 excludes costs of $1.3 million related to restructuring that management believes are not indicative of our business, along with the related tax effects. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release.

Mobile Mini, Inc.

 

Operating Data

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2019

 

 

2018

 

As of June 30:

 

 

 

 

 

 

 

 

Stand-alone Storage Solutions locations

 

 

118

 

 

 

118

 

Stand-alone Tank & Pump Solutions locations

 

 

20

 

 

 

19

 

Combined Storage Solutions and Tank & Pump Solutions locations

 

 

17

 

 

 

18

 

Storage Solutions rental fleet units

 

 

198,000

 

 

 

216,200

 

Tank & Pump Solutions rental fleet units

 

 

12,700

 

 

 

12,600

 

 

 

 

 

 

 

 

 

 

Average utilization based on original equipment cost

 

 

 

 

 

 

 

 

Three months ended June 30:

 

 

 

 

 

 

 

 

Storage Solutions

 

 

76.4

%

 

 

69.3

%

Tank & Pump Solutions

 

 

73.5

%

 

 

74.2

%

 

 

 

 

 

 

 

 

 

Average utilization based on original equipment cost

 

 

 

 

 

 

 

 

Six months ended June 30:

 

 

 

 

 

 

 

 

Storage Solutions

 

 

76.7

%

 

 

68.9

%

Tank & Pump Solutions

 

 

73.8

%

 

 

73.9

%

Mobile Mini, Inc.

 

Business Segment Information - Adjusted (1)

 

(Unaudited)

 

(in thousands, except percentages)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2019

 

 

Three Months Ended June 30, 2018

 

 

 

Storage Solutions

 

 

Tank & Pump Solutions

 

 

Total

 

 

Storage Solutions

 

 

Tank & Pump Solutions

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

$

110,385

 

 

$

31,521

 

 

$

141,906

 

 

$

105,790

 

 

$

27,097

 

 

$

132,887

 

Sales

 

 

6,771

 

 

 

1,364

 

 

 

8,135

 

 

 

7,350

 

 

 

1,531

 

 

 

8,881

 

Other

 

 

63

 

 

 

77

 

 

 

140

 

 

 

190

 

 

 

41

 

 

 

231

 

Total revenues

 

 

117,219

 

 

 

32,962

 

 

 

150,181

 

 

 

113,330

 

 

 

28,669

 

 

 

141,999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental, selling and general expenses

 

 

70,725

 

 

 

20,678

 

 

 

91,403

 

 

 

70,303

 

 

 

18,968

 

 

 

89,271

 

Cost of sales

 

 

4,270

 

 

 

774

 

 

 

5,044

 

 

 

4,900

 

 

 

864

 

 

 

5,764

 

Depreciation and amortization

 

 

10,938

 

 

 

7,197

 

 

 

18,135

 

 

 

10,908

 

 

 

6,284

 

 

 

17,192

 

Total costs and expenses

 

 

85,933

 

 

 

28,649

 

 

 

114,582

 

 

 

86,111

 

 

 

26,116

 

 

 

112,227

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

$

31,286

 

 

$

4,313

 

 

$

35,599

 

 

$

27,219

 

 

$

2,553

 

 

$

29,772

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

45,269

 

 

$

11,638

 

 

$

56,907

 

 

$

41,043

 

 

$

8,944

 

 

$

49,987

 

Adjusted EBITDA Margin

 

 

38.6

%

 

 

35.3

%

 

 

37.9

%

 

 

36.2

%

 

 

31.2

%

 

 

35.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2019

 

 

Six Months Ended June 30, 2018

 

 

 

Storage Solutions

 

 

Tank & Pump Solutions

 

 

Total

 

 

Storage Solutions

 

 

Tank & Pump Solutions

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

$

223,110

 

 

$

60,968

 

 

$

284,078

 

 

$

212,654

 

 

$

52,571

 

 

$

265,225

 

Sales

 

 

12,548

 

 

 

2,810

 

 

 

15,358

 

 

 

14,089

 

 

 

2,895

 

 

 

16,984

 

Other

 

 

288

 

 

 

118

 

 

 

406

 

 

 

359

 

 

 

85

 

 

 

444

 

Total revenues

 

 

235,946

 

 

 

63,896

 

 

 

299,842

 

 

 

227,102

 

 

 

55,551

 

 

 

282,653

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental, selling and general expenses

 

 

143,351

 

 

 

40,286

 

 

 

183,637

 

 

 

141,127

 

 

 

37,142

 

 

 

178,269

 

Cost of sales

 

 

8,086

 

 

 

1,560

 

 

 

9,646

 

 

 

9,469

 

 

 

1,686

 

 

 

11,155

 

Depreciation and amortization

 

 

21,661

 

 

 

13,809

 

 

 

35,470

 

 

 

21,640

 

 

 

12,375

 

 

 

34,015

 

Total costs and expenses

 

 

173,098

 

 

 

55,655

 

 

 

228,753

 

 

 

172,236

 

 

 

51,203

 

 

 

223,439

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

$

62,848

 

 

$

8,241

 

 

$

71,089

 

 

$

54,866

 

 

$

4,348

 

 

$

59,214

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

90,697

 

 

$

22,440

 

 

$

113,137

 

 

$

81,624

 

 

$

16,929

 

 

$

98,553

 

Adjusted EBITDA Margin

 

 

38.4

%

 

 

35.1

%

 

 

37.7

%

 

 

35.9

%

 

 

30.5

%

 

 

34.9

%

(1) These tables present results by major business segment adjusted to exclude certain transactions that management believes are not indicative of our business. See additional information regarding non-GAAP financial information following in this earnings release.

Mobile Mini, Inc.

 

Condensed Consolidated Balance Sheets

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

 

December 31,

 

 

 

2019

 

 

2018

 

 

 

(unaudited)

 

 

(audited)

 

ASSETS

 

Cash and cash equivalents

 

$

4,687

 

 

$

5,605

 

Receivables, net

 

 

106,694

 

 

 

130,233

 

Inventories

 

 

10,385

 

 

 

11,725

 

Rental fleet, net

 

 

951,696

 

 

 

929,090

 

Property, plant and equipment, net

 

 

150,025

 

 

 

154,254

 

Operating lease assets

 

 

96,883

 

 

 

 

Other assets

 

 

14,947

 

 

 

13,398

 

Intangibles, net

 

 

52,321

 

 

 

55,542

 

Goodwill

 

 

705,260

 

 

 

705,217

 

Total assets

 

$

2,092,898

 

 

$

2,005,064

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

Liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

32,190

 

 

$

33,177

 

Accrued liabilities

 

 

71,621

 

 

 

88,136

 

Operating lease liabilities

 

 

98,687

 

 

 

 

Lines of credit

 

 

580,100

 

 

 

593,495

 

Obligations under finance leases

 

 

64,536

 

 

 

63,359

 

Senior notes, net

 

 

246,808

 

 

 

246,489

 

Deferred income taxes

 

 

180,308

 

 

 

170,139

 

Total liabilities

 

 

1,274,250

 

 

 

1,194,795

 

 

 

 

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

 

 

Common stock

 

 

503

 

 

 

500

 

Additional paid-in capital

 

 

631,988

 

 

 

619,850

 

Retained earnings

 

 

418,073

 

 

 

410,641

 

Accumulated other comprehensive loss

 

 

(72,992

)

 

 

(72,861

)

Treasury stock

 

 

(158,924

)

 

 

(147,861

)

Total stockholders' equity

 

 

818,648

 

 

 

810,269

 

Total liabilities and stockholders' equity

 

$

2,092,898

 

 

$

2,005,064

 

Mobile Mini, Inc.

 

Condensed Consolidated Statements of Cash Flows

 

(Unaudited)

 

(in thousands)

 

 

 

Six Months Ended

 

 

 

June 30,

 

 

 

2019

 

 

2018

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net income

 

$

32,143

 

 

$

29,855

 

Adjustments to reconcile net income to net cash

provided by operating activities:

 

 

 

 

 

 

 

 

Deferred financing costs write-off

 

 

123

 

 

 

 

Provision for doubtful accounts

 

 

2,303

 

 

 

1,966

 

Amortization of deferred financing costs

 

 

940

 

 

 

1,030

 

Amortization of long-term liabilities

 

 

13

 

 

 

72

 

Share-based compensation expense

 

 

10,337

 

 

 

5,636

 

Depreciation and amortization

 

 

35,470

 

 

 

34,015

 

Gain on sale of rental fleet

 

 

(3,041

)

 

 

(3,260

)

Loss on disposal of property, plant and equipment

 

 

102

 

 

 

477

 

Deferred income taxes

 

 

10,086

 

 

 

7,253

 

Foreign currency exchange

 

 

166

 

 

 

(45

)

Changes in certain assets and liabilities, net of

effect of businesses acquired

 

 

11,910

 

 

 

(7,047

)

Net cash provided by operating activities

 

 

100,552

 

 

 

69,952

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Additions to rental fleet, excluding acquisitions

 

 

(46,397

)

 

 

(38,476

)

Proceeds from sale of rental fleet

 

 

7,054

 

 

 

7,677

 

Additions to property, plant and equipment, excluding acquisitions

 

 

(6,435

)

 

 

(9,081

)

Proceeds from sale of property, plant and equipment

 

 

133

 

 

 

467

 

Net cash used in investing activities

 

 

(45,645

)

 

 

(39,413

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Net repayments under lines of credit

 

 

(13,395

)

 

 

(16,630

)

Deferred financing costs

 

 

(3,332

)

 

 

 

Principal payments on finance lease obligations

 

 

(5,141

)

 

 

(4,103

)

Issuance of common stock

 

 

1,804

 

 

 

2,494

 

Dividend payments

 

 

(24,689

)

 

 

(22,120

)

Purchase of treasury stock

 

 

(11,063

)

 

 

(540

)

Net cash used in financing activities

 

 

(55,816

)

 

 

(40,899

)

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash

 

 

(9

)

 

 

941

 

 

 

 

 

 

 

 

 

 

Net change in cash

 

 

(918

)

 

 

(9,419

)

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

 

5,605

 

 

 

13,451

 

Cash and cash equivalents at end of period

 

$

4,687

 

 

$

4,032

 

 

 

 

 

 

 

 

 

 

Equipment and other acquired through finance lease obligations

 

$

6,319

 

 

$

6,450

 

Capital expenditures accrued or payable

 

 

6,528

 

 

 

7,190

 

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 and constant currency financial information are non-GAAP financial measures as defined by 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:

Mobile Mini, Inc.

 

Adjusted EBITDA GAAP Reconciliations

 

(Unaudited)

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net income

 

$

14,058

 

 

$

15,000

 

 

$

32,143

 

 

$

29,855

 

Interest expense

 

 

10,592

 

 

 

10,093

 

 

 

21,352

 

 

 

19,692

 

Income tax provision

 

 

6,450

 

 

 

3,463

 

 

 

12,973

 

 

 

8,412

 

Depreciation and amortization

 

 

18,135

 

 

 

17,192

 

 

 

35,470

 

 

 

34,015

 

Deferred financing costs write-off

 

 

 

 

 

 

 

 

123

 

 

 

 

EBITDA

 

 

49,235

 

 

 

45,748

 

 

 

102,061

 

 

 

91,974

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense

 

 

3,340

 

 

 

3,044

 

 

 

6,744

 

 

 

5,273

 

Restructuring expenses

 

 

 

 

 

1,195

 

 

 

 

 

 

1,306

 

Chief Executive Officer transition

 

 

3,593

 

 

 

 

 

 

3,593

 

 

 

 

Acquisition-related expenses

 

 

739

 

 

 

 

 

 

739

 

 

 

 

Adjusted EBITDA

 

$

56,907

 

 

$

49,987

 

 

$

113,137

 

 

$

98,553

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net cash provided by operating activities

 

$

61,769

 

 

$

35,021

 

 

$

100,552

 

 

$

69,952

 

Interest paid

 

 

5,919

 

 

 

5,829

 

 

 

20,195

 

 

 

18,177

 

Income and franchise taxes paid

 

 

1,742

 

 

 

1,287

 

 

 

3,762

 

 

 

1,407

 

Share-based compensation expense,

including restructuring expense

 

 

(6,933

)

 

 

(3,407

)

 

 

(10,337

)

 

 

(5,636

)

Gain on sale of rental fleet

 

 

1,616

 

 

 

1,727

 

 

 

3,041

 

 

 

3,260

 

Loss on disposal of property, plant and

equipment

 

 

(84

)

 

 

(143

)

 

 

(102

)

 

 

(477

)

Changes in certain assets and liabilities, net of

effect of businesses acquired

 

 

(14,794

)

 

 

5,434

 

 

 

(15,050

)

 

 

5,291

 

EBITDA

 

$

49,235

 

 

$

45,748

 

 

$

102,061

 

 

$

91,974

 

Mobile Mini, Inc.

 

Free Cash Flow GAAP Reconciliation

 

(Unaudited)

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net cash provided by operating activities

 

$

61,769

 

 

$

35,021

 

 

$

100,552

 

 

$

69,952

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additions to rental fleet, excluding acquisitions

 

 

(23,381

)

 

 

(23,087

)

 

 

(46,397

)

 

 

(38,476

)

Proceeds from sale of rental fleet

 

 

3,716

 

 

 

3,833

 

 

 

7,054

 

 

 

7,677

 

Additions to property, plant and equipment,

excluding acquisitions

 

 

(3,516

)

 

 

(4,329

)

 

 

(6,435

)

 

 

(9,081

)

Proceeds from sale of property, plant and

equipment

 

 

84

 

 

 

288

 

 

 

133

 

 

 

467

 

Net capital expenditures, excluding acquisitions

 

 

(23,097

)

 

 

(23,295

)

 

 

(45,645

)

 

 

(39,413

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Free cash flow

 

$

38,672

 

 

$

11,726

 

 

$

54,907

 

 

$

30,539

 

 

Adjusted net income 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 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, respectively, divided by total revenues expressed as a percentage.

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.

Constant Currency. We calculate the effect of currency fluctuations on current periods by translating the results for our business in the U.K. during the current period using the average exchange rates from the comparative period. We present constant currency information to provide useful information to assess our underlying business excluding the effect of material foreign currency rate fluctuations. Calculated in constant currency, our rental revenues and adjusted EBITDA for the three months ended June 30, 2019 were $1.1 million and $0.4 million higher than when calculated in accordance with GAAP.

Contacts

Van Welch, Executive VP &
Chief Financial Officer
Mobile Mini, Inc.
(602) 308-3879
www.mobilemini.com
-or-
Investor Relations Counsel:
The Equity Group Inc.
Fred Buonocore (212) 836-9607
Mike Gaudreau (212) 836-9620

Contacts

Van Welch, Executive VP &
Chief Financial Officer
Mobile Mini, Inc.
(602) 308-3879
www.mobilemini.com
-or-
Investor Relations Counsel:
The Equity Group Inc.
Fred Buonocore (212) 836-9607
Mike Gaudreau (212) 836-9620