-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HhDTE/Eht8k2IQ8WNynrymbffTwsOSwTp3bCMUo+VdMhb8hmMMVDP129QdMkRSRS U8633GlO9EfqPB/l7Gftrg== 0000908737-03-000217.txt : 20030430 0000908737-03-000217.hdr.sgml : 20030430 20030430103422 ACCESSION NUMBER: 0000908737-03-000217 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030430 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030430 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IRON MOUNTAIN INC/PA CENTRAL INDEX KEY: 0001020569 STANDARD INDUSTRIAL CLASSIFICATION: PUBLIC WAREHOUSING & STORAGE [4220] IRS NUMBER: 232588479 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13045 FILM NUMBER: 03671099 BUSINESS ADDRESS: STREET 1: 745 ATLANTIC AVENUE CITY: BOSTON STATE: MA ZIP: 02111 BUSINESS PHONE: 6175354766 MAIL ADDRESS: STREET 1: 745 ATLANTIC AVENUE CITY: BOSTON STATE: MA ZIP: 02111 FORMER COMPANY: FORMER CONFORMED NAME: PIERCE LEAHY CORP DATE OF NAME CHANGE: 19960807 8-K 1 imis8k_apr30.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): April 30, 2003 IRON MOUNTAIN INCORPORATED (Exact name of registrant as specified in its charter) PENNSYLVANIA (State or other jurisdiction of incorporation) 1-13045 23-2588479 (Commission File Number) (IRS Employer Identification No.) 745 Atlantic Avenue Boston, Massachusetts 02111 (Address of principal executive offices, including zip code) (617) 535-4766 (Registrant's telephone number, including area code) Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (c) Exhibits Iron Mountain Incorporated (the "Company") hereby furnishes the following exhibit: 99.1 Press release dated April 30, 2003. Item 9. Regulation FD Disclosure. The following information is furnished pursuant to Item 12, "Results of Operations and Financial Condition" in accordance with SEC Release No. 33-8216. This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. On April 30, 2003, the Company issued a press release setting forth the Company's results of operations and financial condition for its first fiscal quarter ended March 31, 2003. A copy of the Company's press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. IRON MOUNTAIN INCORPORATED (Registrant) By: /s/ Jean Bua Name: Jean Bua Title: Vice President and Corporate Controller Date: April 30, 2003 EX-99.1 3 ex99-1.txt Exhibit 99.1 FOR IMMEDIATE RELEASE Contact: Stephen P. Golden Director of Investor Relations (617) 535-4799 Iron Mountain Incorporated Reports First Quarter 2003 Financial Results o Total Revenues are $352 Million, Up 11% o Income From Continuing Operations Before Extraordinary Items is $0.25 per Diluted Share o Operating Income is $72 Million, Up 26% o EBITDA Reaches $104 Million, Up 30% Boston, MA - April 30, 2003 - Iron Mountain Incorporated (NYSE: IRM), the leader in records and information management services, today reported higher revenues, EBITDA and earnings for the quarter ended March 31, 2003. The Company also reported that it generated $72 million of operating income, an increase of 26% over the first quarter of 2002. Iron Mountain's total consolidated revenues for the quarter ended March 31, 2003 grew to $352 million, an increase of 11% compared with the quarter ended March 31, 2002. Storage revenues increased to $203 million for the first quarter from $183 million for the same period in 2002. Storage revenues, which are considered a key performance indicator for the records and information management services industry, are largely recurring since customers typically retain their records for many years. This marks the 57th consecutive quarter for which Iron Mountain has reported increased storage revenues. For the quarter ended March 31, 2003, total internal revenue growth was 8%. Richard Reese, the Company's Chairman and CEO, stated, "The Company posted solid results for the first quarter--revenues were within expectations and our margins were exceptionally strong. Storage growth rates remained stable however, service revenue growth rates, particularly for complementary services were down from last year's levels. As planned, we are increasing our investment in our sales and sales support resources, particularly in the digital services and enterprise solutions and services arenas to take advantage of emerging market opportunities." EBITDA (earnings from continuing operations before interest, taxes, depreciation and amortization) was $104 million, or 29.6% of revenues, for the quarter ended March 31, 2003 compared to $80 million, or 25.2% of revenues, for the quarter ended March 31, 2002. Operating income for the first quarter of 2003 was $72 million, or 20.5% of revenues, compared to $57 million, or 18.0% of revenues, for the same period in 2002. Iron Mountain believes that EBITDA is useful to investors because it is an important financial measure used in evaluating the Company's performance, as EBITDA is an internally generated source of funds for investment in continued growth and for servicing indebtedness. Internally, Iron Mountain uses EBITDA as the basis for evaluating the performance of and allocating resources to its operating segments. Externally, holders of the Company's publicly issued debt use EBITDA and EBITDA-based calculations as important criteria for evaluating the Company and, as a result, all of its bond indentures and covenants include EBITDA and EBITDA-based calculations as primary measures of financial performance. However, EBITDA is subject to foreign currency fluctuations and, under new accounting rules, debt extinguishment charges. As a result, operating income, which is less affected by these items, is emerging as an important measure of the Company's financial performance. -- more -- Iron Mountain Reports First Quarter 2003 Financial Results / Page 2 Below is a reconciliation of Operating Income to EBITDA:
Quarter Ended Reconciliation of Operating Income to EBITDA March 31, -------------------------------- 2002 2003 --------------- -------------- Operating Income $ 57,184 $ 72,227 Add: Depreciation and Amortization 25,156 29,949 --------- --------- 82,340 102,176 Less: Other (Income) Expense, net 1,312 (3,260) Minority Interests in Earnings of Subsidiaries 957 1,300 --------- --------- EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization) $ 80,071 $ 104,136 ========= ========= Digital Operating Losses Included Above $ (1,817) $ (4,764)
Other (Income) Expense, net for the first quarter of 2003 is comprised of a $5 million foreign currency gain, due primarily to the strengthening of the Canadian dollar against the U.S. dollar, partially offset by a $2 million charge for the early extinguishment of debt related to the redemption of the Company's 9-1/8% notes. The Company expects to record a charge of approximately $14 million in the second quarter ending June 30, 2003, for the early extinguishment of debt related to the redemption of the Company's 8-3/4% notes. Other (Income) Expense, net for the first quarter of 2002 is comprised primarily of a $1 million charge for the early extinguishment of debt related to the refinancing of the Company's revolving credit facility. Income from continuing operations before extraordinary items was $21 million, or $0.25 per diluted share, for the first quarter of 2003, compared to $13 million, or $0.15 per diluted share, for the same period in 2002. Net Income for the first quarter of 2003 was $21 million, or $0.25 per diluted share, compared to $6 million, or $0.07 per diluted share, for the same period in 2002. During the first quarter of 2003, the Company completed the redemption of its 9-1/8% notes by retiring the $23 million of aggregate principal amount outstanding at year-end. The Company also exchanged $31 million of its 7-3/4% notes for $30 million of its outstanding 8-3/4% notes. In April 2003, the Company sold $300 million of its 7-3/4% notes at 104.0% of par, which implies an effective yield to worst of 7.066%. The net proceeds to the Company of $307 million will be used to fund the Company's offer to purchase and consent solicitation for its 8-3/4% notes, or to otherwise redeem the 8-3/4% notes, and for general corporate purposes, including the repayment of borrowings under its revolving credit agreement, the possible repayment of other indebtedness and possible future acquisitions. Iron Mountain completed 3 acquisitions since the end of 2002 serving markets in France, Texas and Louisiana. These acquisitions were announced in the Company's fourth quarter 2002 earnings release and were included in the 2003 guidance at that time. -- more -- Iron Mountain Reports First Quarter 2003 Financial Results / Page 3 Financial Performance Outlook The following statements are based on current expectations and do not include the potential impact of any future acquisitions. These statements are forward-looking, and actual results may differ materially. Please refer to the cautionary language included in this press release when considering this information. The Company undertakes no obligation to update this information. The Company is providing the following financial guidance for the quarter ending June 30, 2003 and the full year ending December 31, 2003 (dollars in millions):
Full Year Ending December 31, 2003 ----------------------------------------- Quarter Ending June 30, 2003 Previous Current ----------------- ---------------- ------------------ Low High Low High Low High ------- ------- ------- ------- -------- ------- Revenues $355 $365 $ 1,440 $1,480 $ 1,440 $1,480 Operating Income 68 73 270 290 270 290 Depreciation & Amortization 30 127 123 EBITDA 83 88 390 405 376 392 Capital Expenditures 190 215 190 215 Internal Growth 9% 11% 9% 11%
The Company's second quarter and full year 2003 guidance with respect to EBITDA includes a charge for the early extinguishment of debt related to the redemption of its 8-3/4% notes of approximately $14 million. In addition, the full year 2003 guidance includes the $2 million charge for the early extinguishment of debt related to the redemption of the Company's 9-1/8% notes in the first quarter of 2003. In addition, the Company has not included any foreign currency effects, actual or forecasted, or additional debt extinguishment charges for the second quarter or full-year 2003. Minority interest is assumed to be $5 million for the full year 2003. Following is a reconciliation of operating income to EBITDA with respect to the aforementioned guidance (dollars in millions):
Full Year Ending December 31, 2003 ------------------------------------------- Reconciliation of Operating Income to EBITDA Quarter Ending June 30, 2003 Previous Current -------------------- ----------------- ------------------ Low High Low High Low High ---------- -------- -------- -------- ------- ------ Operating Income $ 68 $ 73 $ 270 $ 290 $ 270 $ 290 Add: Depreciation and Amortization 30 30 125 120 127 123 ---- ---- ----- ----- ----- ----- 98 103 395 410 397 413 Less: Other Expense (1) 14 14 -- -- 16 16 Minority Interest in Earnings of Subsidiaries 1 1 5 5 5 5 ---- ---- ----- ----- ----- ----- EBITDA $ 83 $ 88 $ 390 $ 405 $ 376 $ 392 ==== ==== ===== ===== ===== ===== - ------------------ (1) Other Expense includes charges related to the early extinguishment of debt of $14 million and $16 million for the second quarter and full year 2003, respectively related to the Company's first and second quarter 2003 refinancing events.
Iron Mountain's conference call to discuss the first quarter 2003 financial results will be held today at 11:00 am eastern time. In order to further enhance the overall quality of its investor communications, the Company will simulcast the conference call on its website at www.ironmountain.com. A slide presentation providing summary financial and statistical information that will be discussed on the conference call will also be posted to the website and available for real-time viewing. The slide presentation and replays of the conference call will be available on the website for future reference. -- more -- Iron Mountain Reports First Quarter 2003 Financial Results / Page 4 About Iron Mountain Iron Mountain Incorporated is the world's trusted partner for outsourced records and information management services. Founded in 1951, the Company has grown to service more than 150,000 customer accounts throughout the United States, Canada, Europe and Latin America. Iron Mountain offers records management services for both physical and digital media, disaster recovery support services, and consulting - services that help businesses save money and manage risks associated with legal and regulatory compliance, protection of vital information, and business continuity challenges. For more information, visit www.ironmountain.com. Certain Important Factors This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and is subject to the safe-harbor created by such Act. Forward-looking statements include our second quarter and full year 2003 financial performance outlook and statements regarding our goals, beliefs, strategies, objectives, plans or current expectations. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those contemplated in the forward-looking statements. Such factors include, but are not limited to: (i) changes in customer preferences and demand for the Company's services; (ii) changes in the price for the Company's services relative to the cost of providing such services; (iii) the cost and availability of financing for contemplated growth; (iv) the Company's ability or inability to complete acquisitions on satisfactory terms and to integrate acquired companies efficiently; (v) in the various digital businesses on which the Company is embarking, capital and technical requirements will be beyond the Company's means, markets for the Company's services will be less robust than anticipated, or competition will be more intense than anticipated; (vi) the possibility that business partners upon which the Company depends for technical assistance or management and acquisition expertise outside the United States will not perform as anticipated; (vii) changes in the political and economic environments in the countries in which the Company's international subsidiaries operate; and (viii) other trends in competitive or economic conditions affecting Iron Mountain's financial condition or results of operations not presently contemplated. Iron Mountain undertakes no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. NOTE: Condensed Consolidated Financial Statements of Iron Mountain Incorporated follow. Iron Mountain Reports First Quarter 2003 Financial Results / Page 5
IRON MOUNTAIN INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in Thousands except Per Share Data) (Unaudited) Three Months Ended March 31, ---------------------- 2002 2003 --------- --------- REVENUES: Storage $ 183,436 $ 202,831 Service and Storage Material Sales 133,762 148,980 --------- --------- Total Revenues 317,198 351,811 OPERATING EXPENSES: Cost of Sales (Excluding Depreciation) 152,446 160,151 Selling, General and Administrative 82,194 91,156 Depreciation and Amortization 25,156 29,949 Merger-Related Expenses 300 -- Gain on Disposal/Writedown of Property, Plant and Equipment, Net (82) (1,672) --------- --------- Total Operating Expenses 260,014 279,584 --------- --------- OPERATING INCOME 57,184 72,227 INTEREST EXPENSE, NET 32,880 35,565 OTHER EXPENSE (INCOME), NET 1,312 (3,260) --------- --------- Income from Continuing Operations Before Provision for Income Taxes and Minority Interest 22,992 39,922 PROVISION FOR INCOME TAXES 9,517 17,338 MINORITY INTEREST IN EARNINGS OF SUBSIDIARIES 957 1,300 --------- --------- Income from Continuing Operations Before Cumulative Effect of Change in Accounting Principle 12,518 21,284 CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE (NET OF MINORITY INTEREST) (1) (6,396) -- --------- --------- Net Income $ 6,122 $ 21,284 ========= ========= INCOME FROM CONTINUING OPERATIONS BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE PER SHARE - BASIC $ 0.15 $ 0.25 ========= ========= INCOME FROM CONTINUING OPERATIONS BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE PER SHARE - DILUTED $ 0.15 $ 0.25 ========= ========= NET INCOME PER SHARE - BASIC $ 0.07 $ 0.25 ========= ========= NET INCOME PER SHARE - DILUTED $ 0.07 $ 0.25 ========= ========= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC 84,372 85,097 ========= ========= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - DILUTED 86,002 86,551 ========= ========= EBITDA $ 80,071 $ 104,136 ========= ========= (1) Represents the non-cash charge related to the impairment of goodwill associated with the Company's investment in South America due primarily to the deterioration of the economy and the devaluation of the currency in Argentina.
-- more -- Iron Mountain Reports First Quarter 2003 Financial Results / Page 6
IRON MOUNTAIN INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in Thousands) (Unaudited) December 31, March 31, 2002 2003 ------------ ----------- ASSETS CURRENT ASSETS: Cash and Cash Equivalents $ 56,292 $ 13,581 Accounts Receivable (less allowances of $20,274 and $20,316, respectively) 225,416 248,973 Other Current Assets 85,332 76,697 ----------- ----------- Total Current Assets 367,040 339,251 ----------- ----------- PROPERTY, PLANT AND EQUIPMENT: Property, Plant and Equipment at Cost 1,577,588 1,643,511 Less: Accumulated Depreciation (338,400) (367,717) ----------- ----------- Property, Plant and Equipment, net 1,239,188 1,275,794 ----------- ----------- OTHER ASSETS: Goodwill, net 1,544,974 1,572,663 Other Non-current Assets, net 79,453 81,162 ----------- ----------- Total Other Assets 1,624,427 1,653,825 ----------- ----------- Total Assets $ 3,230,655 $ 3,268,870 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current Portion of Long-term Debt $ 69,732 $ 43,858 Other Current Liabilities 358,230 353,083 ----------- ----------- Total Current Liabilities 427,962 396,941 LONG-TERM DEBT, NET OF CURRENT PORTION 1,662,365 1,679,861 OTHER LONG-TERM LIABILITIES 133,335 148,015 MINORITY INTERESTS 62,132 67,641 SHAREHOLDERS' EQUITY 944,861 976,412 ----------- ----------- Total Liabilities and Shareholders' Equity $ 3,230,655 $ 3,268,870 =========== ===========
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