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Mobile Mini Reports Q4 2019 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 tank and pump solutions in the United States, today reported actual and adjusted financial results for the quarter ended December 31, 2019.

The Company realized net income of $29.0 million, or $0.66 per diluted share, in the fourth quarter of 2019. On an adjusted basis, fourth quarter net income was $29.8 million, or $0.67 per diluted share, as compared to adjusted net income of $23.7 million, or $0.53 per diluted share, for the same period last year. Adjusted EBITDA was $68.1 million and adjusted EBITDA margin was 42.7% for the fourth quarter of 2019.

Total revenues were $159.3 million and rental revenues were $152.1 million for the fourth quarter of 2019, as compared to $160.9 million and $152.0 million, respectively, for the same period last year. Rental revenues for the Storage Solutions and Tank & Pump Solutions businesses for the current quarter were $125.5 million and $26.6 million, respectively, compared to $122.2 million and $29.9 million for the same period last year.

Dividend

The Company’s Board of Directors declared a cash dividend of 30.3 cents per share, which will be paid on March 11, 2020 to shareholders of record as of February 26, 2020.

Fourth Quarter 2019 Highlights

  • Drove healthy year-over-year growth of 4.1% in North American Storage Solutions rental revenue.
  • Grew consolidated adjusted EBITDA 7.6%, year-over-year, and expanded adjusted EBITDA margin by 340 basis points to 42.7%, driven by a 460 basis point year-over-year increase for Storage Solutions.
  • Generated cash from operating activities of $60.8 million for the quarter and $212.7 million for the full year, resulting in free cash flow of $51.1 million for the quarter and $143.1 million for the year, nearly double the prior year.
  • Raised North American Storage Solutions core (excluding seasonal) rates 4.5% year-over-year, with rates on newly placed units up 5.4%.
  • Maintained strong average OEC utilization rate of 80.6% for Storage Solutions.
  • Further increased return on capital employed to 10.1% as of December 31, 2019, exceeding our weighted average cost of capital and improving 160 basis points from December 31, 2018.
  • Decreased leverage ratio to 3.6x as of December 31, 2019 compared to 4.2x as of December 31, 2018.
  • Completed three acquisitions in the quarter, thereby strengthening our existing operations in Missouri and New York and expanding our serviceable reach in the Bloomington, Illinois market.

CEO Comments

Kelly Williams, Mobile Mini’s President and Chief Executive Officer, remarked, "Our record free cash flow generation in 2019 reflects the strength of our business model and provides us with considerable flexibility in capital allocation. Our strong fourth quarter 2019 financial performance is highlighted by 7.6% year-over-year growth in consolidated adjusted EBITDA, along with margin expansion of 340 basis points to 42.7%. I am especially pleased with the performance of our North America Storage Solutions business which included rental revenue growth of 4.1% and a very robust adjusted EBITDA margin of 47.3%."

Mr. Williams continued, "In the twelve months ended December 31, 2019, we executed our strategic plan and delivered on our Evergreen model. We also nearly doubled free cash flow in 2019 relative to the prior year. We enter 2020 from a position of operational and financial strength, with a large and diversified customer base and a sustainable operational cadence. On a consolidated basis, in 2020 we expect to continue to grow rental revenues by GDP plus 2% to 3% while expanding adjusted EBITDA margin and generating strong levels of consolidated free cash flow, exceeding 2019 amounts."

Conference Call

Mobile Mini will host a conference call tomorrow, January 29th at 9 am 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 Investor Relations 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 90 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 200,200 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 156 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 grow above GDP, expand adjusted EBITDA margins, and generate strong free cash flow, 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 Operations

 

(Unaudited)

 

(in thousands, except percentages and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2019

 

 

Three Months Ended December 31, 2018

 

 

 

Actual

 

 

Adjustments

 

 

Adjusted (1)

 

 

Actual

 

 

Adjustments

 

 

Adjusted (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

$

152,060

 

 

$

 

 

$

152,060

 

 

$

152,048

 

 

$

 

 

$

152,048

 

Sales

 

 

7,149

 

 

 

 

 

 

7,149

 

 

 

8,654

 

 

 

 

 

 

8,654

 

Other

 

 

57

 

 

 

 

 

 

57

 

 

 

167

 

 

 

 

 

 

167

 

Total revenues

 

 

159,266

 

 

 

 

 

 

159,266

 

 

 

160,869

 

 

 

 

 

 

160,869

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental, selling and general expenses

 

 

90,157

 

 

 

(972

)

 

 

89,185

 

 

 

95,090

 

 

 

 

 

 

95,090

 

Cost of sales

 

 

4,191

 

 

 

 

 

 

4,191

 

 

 

5,512

 

 

 

 

 

 

5,512

 

Restructuring expense

 

 

 

 

 

 

 

 

 

 

 

700

 

 

 

(700

)

 

 

 

Asset impairment charge and

loss on divestiture, net

 

 

 

 

 

 

 

 

 

 

 

3,862

 

 

 

(3,862

)

 

 

 

Depreciation and amortization

 

 

17,623

 

 

 

 

 

 

17,623

 

 

 

16,794

 

 

 

 

 

 

16,794

 

Total costs and expenses

 

 

111,971

 

 

 

(972

)

 

 

110,999

 

 

 

121,958

 

 

 

(4,562

)

 

 

117,396

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

47,295

 

 

 

972

 

 

 

48,267

 

 

 

38,911

 

 

 

4,562

 

 

 

43,473

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(9,633

)

 

 

 

 

 

(9,633

)

 

 

(10,725

)

 

 

 

 

 

(10,725

)

Foreign currency exchange

 

 

(95

)

 

 

 

 

 

(95

)

 

 

(5

)

 

 

 

 

 

(5

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax provision

 

 

37,567

 

 

 

972

 

 

 

38,539

 

 

 

28,181

 

 

 

4,562

 

 

 

32,743

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

8,551

 

 

 

226

 

 

 

8,777

 

 

 

13,933

 

 

 

(4,863

)

 

 

9,070

 

Net income

 

$

29,016

 

 

$

746

 

 

$

29,762

 

 

$

14,248

 

 

$

9,425

 

 

$

23,673

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA/Adjusted EBITDA

 

$

64,823

 

 

 

 

 

 

$

68,082

 

 

$

55,700

 

 

 

 

 

 

$

63,263

 

EBITDA/Adjusted EBITDA as a percentage of

total revenues

 

 

40.7

%

 

 

 

 

 

 

42.7

%

 

 

34.6

%

 

 

 

 

 

 

39.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.66

 

 

 

 

 

 

$

0.68

 

 

$

0.32

 

 

 

 

 

 

$

0.53

 

Diluted

 

 

0.66

 

 

 

 

 

 

 

0.67

 

 

 

0.32

 

 

 

 

 

 

 

0.53

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common and

common share equivalents outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

43,707

 

 

 

 

 

 

 

43,707

 

 

 

44,353

 

 

 

 

 

 

 

44,353

 

Diluted

 

 

44,266

 

 

 

 

 

 

 

44,266

 

 

 

44,885

 

 

 

 

 

 

 

44,885

 

(1)

 

Adjusted column for the three-month period ended December 31, 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 December 31, 2019 include the following, along with the related tax effects:

 

  • Reduction of rental, selling and general expenses to exclude $0.5 million of expenses related to actual and potential acquisitions.
  • Reduction of rental, selling and general expenses to exclude $0.5 million of expenses related to a realignment of personnel and resources with our current business model and operational needs.

 

 

 

(2)

 

Adjusted column for the three-month period ended December 31, 2018 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 December 31, 2018 include the following:

 

  • Exclusion of costs of $0.7 million related to the restructuring of our business operations, along with the related tax effect.
  • Exclusion of an asset impairment charge and loss on divestiture, net of proceeds of $3.9 million related to assets that the Company placed as held for sale, along with the related tax effect.
  • Exclusion of $5.8 million in income tax provision resulting from an out-of-period adjustment recorded in the fourth quarter of 2018 to correct deferred tax assets that had been established in previous years.
...
 

Mobile Mini, Inc.

 

Condensed Consolidated Statements of Operations

 

(Unaudited)

 

(in thousands, except percentages and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended December 31, 2019

 

 

Twelve Months Ended December 31, 2018

 

 

 

Actual

 

 

Adjustments

 

 

Adjusted (1)

 

 

Actual

 

 

Adjustments

 

 

Adjusted (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

$

581,657

 

 

$

 

 

$

581,657

 

 

$

558,197

 

 

$

 

 

$

558,197

 

Sales

 

 

30,394

 

 

 

 

 

 

30,394

 

 

 

34,354

 

 

 

 

 

 

34,354

 

Other

 

 

574

 

 

 

 

 

 

574

 

 

 

678

 

 

 

 

 

 

678

 

Total revenues

 

 

612,625

 

 

 

 

 

 

612,625

 

 

 

593,229

 

 

 

 

 

 

593,229

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental, selling and general expenses

 

 

369,525

 

 

 

(7,202

)

 

 

362,323

 

 

 

364,123

 

 

 

 

 

 

364,123

 

Cost of sales

 

 

18,675

 

 

 

 

 

 

18,675

 

 

 

22,437

 

 

 

 

 

 

22,437