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Exhibit 99.1

 

LOGO

FOR IMMEDIATE RELEASE

MOBILE MINI REPORTS Q2 2018 RESULTS AND ANNOUNCES QUARTERLY DIVIDEND

Phoenix, AZ – July 26, 2018 – 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, 2018. Total revenues were $142.0 million and rental revenues were $132.9 million, as compared to $126.7 million and $117.9 million, respectively, for the same period last year.

Rental revenues for the Storage Solutions and Tank & Pump Solutions businesses for the current quarter were $105.8 million and $27.1 million, respectively, compared to $95.5 million and $22.4 million, respectively, for the same period last year.

The Company recorded net income of $15.0 million, or $0.33 per diluted share, in the second quarter of 2018, as compared to net income of $8.8 million, or $0.20 per diluted share, for the second quarter of 2017. On an adjusted basis, second quarter net income was $15.9 million, or $0.35 per diluted share, as compared to adjusted net income of $10.4 million, or $0.24 per diluted share, for the second quarter of 2017. Adjusted EBITDA was $50.0 million and adjusted EBITDA margin was 35.2% for the second quarter of 2018.

Dividend

The Company’s Board of Directors declared a cash dividend of 25.0 cents per share, which will be paid on August 29, 2018 to shareholders of record on August 15, 2018.

Second Quarter 2018 Highlights

 

   

Continued strong rental revenue growth in Tank & Pump Solutions with a 21.2% year-over-year increase.

 

   

Delivered robust Storage Solutions rental revenue year-over-year growth of 10.8%, 9.5% when adjusted for favorable currency fluctuations.

 

   

Drove average original equipment cost utilization for Tank & Pump Solutions to 74.2% for the quarter, up 970 basis points compared to the prior-year quarter, with the most fleet on rent since the acquisition of this business in 2014.

 

   

Increased total Storage Solutions average units on rent by 3.7% year-over-year, with average utilization of 70.6%, up 120 basis from the prior-year quarter.

 

   

Raised Storage Solutions rental rates by 2.4% year-over-year, with rates on new rentals up 1.9%.

 

   

Achieved adjusted EBITDA growth of 19.1%, compared to the prior-year quarter, 18.1% in constant currency.

 

   

Generated strong net cash from operating activities of $35.0 million and free cash flow of $11.7 million.

CEO Comments

Erik Olsson, Mobile Mini’s President and Chief Executive Officer, remarked, “We continue to drive exceptional year-over-year rental revenue growth, achieving a very strong 12.8% increase during the second quarter. Our Tank & Pump Solutions business recorded the highest quarterly revenue since we acquired the business in 2014, with year-over-year organic growth exceeding 20%. We expect Tank & Pump Solutions to continue to deliver robust year-over-year growth for the remainder of this year as we gain traction on the new agreements signed in the fourth quarter of 2017 and first quarter


of 2018. Our Storage Solutions segment also generated strong second quarter results, with year-over-year organic rental revenue growth of nearly 11%. The robust top-line growth of our consolidated business resulted in a 19.1% year-over-year increase in adjusted EBITDA.”

Mr. Olsson continued, “We believe that the end market demand for Tank & Pump has normalized and the current level of activity within this segment will continue. As we noted last quarter, we are uniquely positioned to drive growth in excess of the market amongst both large and small customers in this business. Our storage business is also very healthy and our pipeline looks robust. The current performance and pipeline reinforces our outlook for revenue increases in excess of our evergreen model, leading to continued strong increases in adjusted EBITDA and healthy free cash flow generation.”

Subsequent Event

Consistent with Mobile Mini’s strategy to focus on high returning assets and continuous improvements in efficiency, the Company engaged in an organization-wide project to assess the economic and operational status of its fleet and other assets as well as an in depth analysis of its fleet management process to identify inefficiencies. The task encompassed an intensive review of underperforming assets throughout North America and the United Kingdom using the Company’s recently implemented enterprise resource planning software and sophisticated work order system that allows specific identification of the status of each unit and facilitates deeper analysis of repair and maintenance costs. The review resulted in the identification of certain assets for which management determined it does not make economic sense to repair and retain.

In July 2018 management presented its proposed plan of sale for identified assets to the Board of Directors, and on July 24, the Board of Directors made the strategic decision to approve the plan and authorized management to begin actively marketing the assets for sale. As a result, the Company expects to place these assets as available for sale, mostly for scrap value, and to recognize a non-cash loss of $100 million in the third quarter of 2018, net of expected cash proceeds received.

The assets to be disposed of have not generated meaningful revenue over the last several years and therefore we do not believe that the asset disposal will affect the Company’s ability to generate revenue or to meet customer demand. Consequently, this project is not expected to affect the Company’s capital expenditures, nor will it negatively affect liquidity or free cash flow.

As a result of this project several yards will be exited, headcount will be reduced and other efficiencies have been identified. In total, when the changes have been fully implemented, the Company expects $5 million to $7 million in annual operational savings, along with approximately $4 million of reduced depreciation expense.

Conference Call

Mobile Mini will host a conference call today, Thursday, July 26 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 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 216,200 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 12,600 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.

 

2


Forward-Looking Statements

This news release contains forward-looking statements, including, but not limited to, expected annual savings from the asset disposal, the continued growth of adjusted EBITDA, free cash flow, the level of activity of our Tank & Pump Solutions business, our ability to generate revenue or to meet customer demand and continue to have a healthy pipeline, 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.

 

CONTACT:

   -OR-    INVESTOR RELATIONS COUNSEL:
Van Welch, Executive VP &       The Equity Group Inc.
Chief Financial Officer       Fred Buonocore (212) 836-9607
Mobile Mini, Inc.       Kevin Towle (212) 836-9620

(602) 308-3879

www.mobilemini.com

     

(See accompanying tables)

 

3


Mobile Mini, Inc.

Condensed Consolidated Statements of Income

(Unaudited)

(in thousands, except percentages and per share data)

 

     Three Months Ended June 30, 2018     Three Months Ended June 30, 2017  
     Actual     Adjustments     Adjusted (1)     Actual     Adjustments     Adjusted (2)  

Revenues:

            

Rental

   $ 132,887     $     $ 132,887     $ 117,851     $     $ 117,851  

Sales

     8,881             8,881       8,401             8,401  

Other

     231             231       438             438  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

         141,999               —           141,999           126,690               —           126,690  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Costs and expenses:

            

Rental, selling and general expenses

     89,271             89,271       82,850       (2,056     80,794  

Cost of sales

     5,764             5,764       5,408             5,408  

Restructuring expenses

     1,195       (1,195           538       (538      

Depreciation and amortization

     17,192             17,192       15,742             15,742  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total costs and expenses

     113,422       (1,195     112,227       104,538       (2,594     101,944  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income from operations

     28,577       1,195       29,772       22,152       2,594       24,746  

Other income (expense):

            

Interest income

                       16             16  

Interest expense

     (10,093           (10,093     (8,807           (8,807

Foreign currency exchange

     (21           (21     (18           (18
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income before income tax provision

     18,463       1,195       19,658       13,343       2,594       15,937  

Income tax provision

     3,463       300       3,763       4,566       994       5,560  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 15,000     $ 895     $ 15,895     $ 8,777     $ 1,600     $ 10,377  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA/Adjusted EBITDA

   $ 45,748       $ 49,987     $ 37,892       $ 41,960  

EBITDA/Adjusted EBITDA as a percentage of total revenues

     32.2       35.2     29.9       33.1

Earnings per share:

            

Basic

   $ 0.34       $ 0.36     $ 0.20       $ 0.24  

Diluted

     0.33         0.35       0.20         0.24  

Weighted average number of common and

common share equivalents outstanding:

            

Basic

     44,287         44,287       43,944         43,944  

Diluted

     45,091         45,091       44,025         44,025  

 

(1) 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 (defined herein) presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release.

 

(2) Adjusted column for the three months ended June 30, 2017 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, 2017 include the following, along with the related tax effects:
    Reduction of $2.1 million in rental, selling and general expenses to exclude costs related to severance in conjunction with the departure of an executive.
    Exclusion of costs of $0.5 million related to the restructuring of our business operations.

 

4


Mobile Mini, Inc.

Condensed Consolidated Statements of Income

(Unaudited)

(in thousands, except percentages and per share data)

 

     Six Months Ended June 30, 2018     Six Months Ended June 30, 2017  
     Actual     Adjustments     Adjusted (1)     Actual     Adjustments     Adjusted (2)  

Revenues:

            

Rental

   $ 265,225     $     $ 265,225     $ 232,593     $     $ 232,593  

Sales

     16,984             16,984       16,379             16,379  

Other

     444             444       1,245             1,245  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

         282,653               —           282,653           250,217               —           250,217  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Costs and expenses:

            

Rental, selling and general expenses

     178,269             178,269       161,209       (2,386     158,823  

Cost of sales

     11,155             11,155       10,520             10,520  

Restructuring expenses

     1,306       (1,306           1,437       (1,437      

Depreciation and amortization

     34,015             34,015       31,006             31,006  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total costs and expenses

     224,745       (1,306     223,439       204,172       (3,823     200,349  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income from operations

     57,908       1,306       59,214       46,045       3,823       49,868  

Other income (expense):

            

Interest income

     6             6       16             16  

Interest expense

     (19,692           (19,692     (17,209           (17,209

Foreign currency exchange

     45             45       (27           (27
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income before income tax provision

     38,267       1,306       39,573       28,825       3,823       32,648  

Income tax provision

     8,412       328       8,740       9,896       1,450       11,346  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 29,855     $ 978     $ 30,833     $ 18,929     $ 2,373     $ 21,302  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA/Adjusted EBITDA

   $ 91,974       $ 98,553     $ 77,040       $ 83,648  

EBITDA/Adjusted EBITDA as a percentage of total revenues

     32.5       34.9     30.8       33.4

Earnings per share:

            

Basic

   $ 0.67       $ 0.70     $ 0.43       $ 0.48  

Diluted

     0.66         0.69       0.43         0.48  

Weighted average number of common and common share equivalents outstanding:

            

Basic

     44,251         44,251       44,026         44,026  

Diluted

     44,967         44,967       44,183         44,183  

 

(1) 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 (defined herein) presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release.

 

(2) Adjusted column for the six months ended June 30, 2017 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, 2017 include the following, along with the related tax effects:
    Reduction of $0.1 million in rental, selling and general expenses to exclude acquisition-related expenses.
    Reduction of $2.3 million in rental, selling and general expenses to exclude costs related to severance and transition in conjunction with the departure of executives.
    Exclusion of costs of $1.4 million related to the restructuring of our business operations.

 

5


Mobile Mini, Inc.

Operating Data

(Unaudited)

 

         2018                    2017          
As of June 30:              

Stand-alone Storage Solutions locations

     118           123  

Stand-alone Tank & Pump Solutions locations

     19           18  

Combined Storage Solutions and Tank & Pump Solutions locations

     18           15  

Storage Solutions rental fleet units

     216,200           211,900  

Tank & Pump Solutions rental fleet units

     12,600           12,000  

Average utilization—Three months ended June 30:

     

Storage Solutions—utilization based on number of units

     70.6%        69.4

Tank & Pump Solutions—utilization based on original equipment cost

     74.2%        64.5

Average utilization—Six months ended June 30:

     

Storage Solutions—utilization based on number of units

     70.6%        69.2

Tank & Pump Solutions—utilization based on original equipment cost

     73.9%        63.2

 

6


Mobile Mini, Inc.

Business Segment Information—Adjusted (1)

(Unaudited)

(in thousands, except percentages)

 

     Three Months Ended June 30, 2018     Three Months Ended June 30, 2017  
     Storage
Solutions
    Tank & Pump
Solutions
    Total     Storage
Solutions
    Tank & Pump
Solutions
    Total  

Revenues:

            

Rental

   $ 105,790     $ 27,097     $ 132,887     $ 95,486     $ 22,365     $ 117,851  

Sales

     7,350       1,531       8,881       7,156       1,245       8,401  

Other

     190       41       231       344       94       438  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

         113,330           28,669           141,999           102,986           23,704           126,690  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Costs and expenses:

            

Rental, selling and general expenses

     70,303       18,968       89,271       64,075       16,719       80,794  

Cost of sales

     4,900       864       5,764       4,730       678       5,408  

Depreciation and amortization

     10,908       6,284       17,192       9,477       6,265       15,742  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total costs and expenses

     86,111       26,116       112,227       78,282       23,662       101,944  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income from operations

   $ 27,219     $ 2,553     $ 29,772     $ 24,704     $ 42     $ 24,746  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 41,043     $ 8,944     $ 49,987     $ 35,589     $ 6,371     $ 41,960  

Adjusted EBITDA Margin

     36.2     31.2     35.2     34.6     26.9     33.1
     Six Months Ended June 30, 2018     Six Months Ended June 30, 2017  
     Storage
Solutions
    Tank & Pump
Solutions
    Total     Storage
Solutions
    Tank & Pump
Solutions
    Total  

Revenues:

            

Rental

   $ 212,654     $ 52,571     $ 265,225     $ 189,292     $ 43,301     $ 232,593  

Sales

     14,089       2,895       16,984       14,020       2,359       16,379  

Other

     359       85       444       1,017       228       1,245  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     227,102       55,551       282,653       204,329       45,888       250,217  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Costs and expenses:

            

Rental, selling and general expenses

     141,127       37,142       178,269       125,970       32,853       158,823  

Cost of sales

     9,469       1,686       11,155       9,331       1,189       10,520  

Depreciation and amortization

     21,640       12,375       34,015       18,660       12,346       31,006  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total costs and expenses

     172,236       51,203       223,439       153,961       46,388       200,349  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from operations

   $ 54,866     $ 4,348     $ 59,214     $ 50,368     $ (500   $ 49,868  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 81,624     $ 16,929     $ 98,553     $ 71,681     $ 11,967     $ 83,648  

Adjusted EBITDA Margin

     35.9     30.5     34.9     35.1     26.1     33.4

 

  (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.

 

7


Mobile Mini, Inc.

Condensed Consolidated Balance Sheets

(in thousands)

 

     June 30,
2018
    December 31,
2017
 
     (unaudited)     (audited)  
ASSETS  

Cash and cash equivalents

   $ 4,032     $ 13,451  

Receivables, net

     112,267       111,562  

Inventories

     16,402       15,671  

Rental fleet, net

     1,003,276       989,154  

Property, plant and equipment, net

     156,675       157,304  

Other assets

     14,923       15,334  

Intangibles, net

     58,784       62,024  

Goodwill

     707,462       708,907  
  

 

 

   

 

 

 

Total assets

   $             2,073,821     $             2,073,407  
  

 

 

   

 

 

 
LIABILITIES AND STOCKHOLDERS’ EQUITY  

Liabilities:

    

Accounts payable

   $ 29,708     $ 26,955  

Accrued liabilities

     72,988       78,084  

Lines of credit

     617,655       634,285  

Obligations under capital leases

     55,138       52,791  

Senior notes, net

     246,169       245,850  

Deferred income taxes

     179,690       173,754  
  

 

 

   

 

 

 

Total liabilities

     1,201,348       1,211,719  
  

 

 

   

 

 

 

Stockholders’ equity:

    

Common stock

     500       497  

Additional paid-in capital

     613,496       605,369  

Retained earnings

     470,874       463,322  

Accumulated other comprehensive loss

     (64,691     (60,334

Treasury stock

     (147,706     (147,166
  

 

 

   

 

 

 

Total stockholders’ equity

     872,473       861,688  
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 2,073,821     $ 2,073,407  
  

 

 

   

 

 

 

 

8


Mobile Mini, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)

 

     Six Months Ended
June 30,
 
     2018     2017  

Cash flows from operating activities:

    

Net income

   $ 29,855     $ 18,929  

Adjustments to reconcile net income to net cash provided by operating activities:

    

Provision for doubtful accounts

     1,966       2,202  

Amortization of deferred financing costs

     1,030       1,030  

Amortization of long-term liabilities

     72       65  

Share-based compensation expense

     5,636       3,820  

Depreciation and amortization

     34,015       31,006  

Gain on sale of rental fleet

     (3,260     (2,826

Loss on disposal of property, plant and equipment

     477       282  

Deferred income taxes

     7,253       9,151  

Foreign currency exchange

     (45     27  

Changes in certain assets and liabilities, net of effect of businesses acquired

     (7,047     (465
  

 

 

   

 

 

 

Net cash provided by operating activities

               69,952                 63,221  
  

 

 

   

 

 

 

Cash flows from investing activities:

    

Additions to rental fleet, excluding acquisitions

     (38,476     (23,027

Proceeds from sale of rental fleet

     7,677       6,283  

Additions to property, plant and equipment, excluding acquisitions

     (9,081     (8,707

Proceeds from sale of property, plant and equipment

     467       768  
  

 

 

   

 

 

 

Net cash used in investing activities

     (39,413     (24,683
  

 

 

   

 

 

 

Cash flows from financing activities:

    

Net repayments under lines of credit

     (16,630     (3,509

Deferred financing costs

           (12

Principal payments on capital lease obligations

     (4,103     (3,736

Issuance of common stock

     2,494       1,640  

Dividend payments

     (22,120     (20,119

Purchase of treasury stock

     (540     (7,984
  

 

 

   

 

 

 

Net cash used in financing activities

     (40,899     (33,720
  

 

 

   

 

 

 

Effect of exchange rate changes on cash

     941       319  
  

 

 

   

 

 

 

Net change in cash

     (9,419     5,137  

Cash and cash equivalents at beginning of period

     13,451       4,137  
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 4,032     $ 9,274  
  

 

 

   

 

 

 

Equipment and other acquired through capital lease obligations

   $ 6,450     $ 2,333  

Capital expenditures accrued or payable

     7,190       8,268  

 

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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, 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,
 
     2018      2017      2018      2017  

Net income

   $ 15,000      $ 8,777      $ 29,855      $ 18,929  

Interest expense

     10,093        8,807        19,692        17,209  

Income tax provision

     3,463        4,566        8,412        9,896  

Depreciation and amortization

     17,192        15,742        34,015        31,006  
  

 

 

    

 

 

    

 

 

    

 

 

 

EBITDA

     45,748        37,892        91,974        77,040  

Share-based compensation expense

     3,044        1,474        5,273        2,785  

Restructuring expenses

     1,195        538        1,306        1,437  

Acquisition-related expenses

            9               97  

Other

            2,047               2,289  
  

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted EBITDA

   $ 49,987      $ 41,960      $ 98,553      $ 83,648  
  

 

 

    

 

 

    

 

 

    

 

 

 
     Three Months Ended
June 30,
     Six Months Ended
June 30,
 
     2018      2017      2018      2017  

Net cash provided by operating activities

   $ 35,021      $ 30,498      $ 69,952      $ 63,221  

Interest paid

     5,829        4,516        18,177        18,187  

Income and franchise taxes paid

     1,287        1,100        1,407        1,100  

Share-based compensation expense, including restructuring expense

     (3,407      (2,509      (5,636      (3,820

Gain on sale of rental fleet

     1,727        1,123        3,260        2,826  

Loss on disposal of property, plant and equipment

     (143      (264      (477      (282

Changes in certain assets and liabilities, net of effect of businesses acquired

     5,434        3,428        5,291        (4,192
  

 

 

    

 

 

    

 

 

    

 

 

 

EBITDA

   $       45,748      $       37,892      $       91,974      $       77,040  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

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Mobile Mini, Inc.

Free Cash Flow GAAP Reconciliation

(Unaudited)

(in thousands)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2018     2017     2018     2017  

Net cash provided by operating activities

   $ 35,021     $ 30,498     $ 69,952     $ 63,221  
  

 

 

   

 

 

   

 

 

   

 

 

 

Additions to rental fleet, excluding acquisitions

     (23,087     (13,021     (38,476     (23,027

Proceeds from sale of rental fleet

     3,833       1,661       7,677       6,283  

Additions to property, plant and equipment, excluding acquisitions

     (4,329     (4,959     (9,081     (8,707

Proceeds from sale of property, plant and equipment

     288       700       467       768  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net capital expenditures, excluding acquisitions

     (23,295     (15,619     (39,413     (24,683
  

 

 

   

 

 

   

 

 

   

 

 

 

Free cash flow

   $       11,726     $       14,879     $       30,539     $       38,538  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

11


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, 2018 were $1.2 million and $0.4 million lower than when calculated in accordance with GAAP.

 

12