-----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, KfczrsYT8VlCFvQNRQY7PV7yJOytrrhU3AInLvKT7FzydZKy8jp3lI0MZfoAmZOm F7IY3FOjMqYsEYCTVLC5QA== 0001144204-07-022091.txt : 20070502 0001144204-07-022091.hdr.sgml : 20070502 20070502100845 ACCESSION NUMBER: 0001144204-07-022091 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20070502 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070502 DATE AS OF CHANGE: 20070502 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IRON MOUNTAIN INC CENTRAL INDEX KEY: 0001020569 STANDARD INDUSTRIAL CLASSIFICATION: PUBLIC WAREHOUSING & STORAGE [4220] IRS NUMBER: 232588479 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13045 FILM NUMBER: 07808678 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: IRON MOUNTAIN INC/PA DATE OF NAME CHANGE: 20000201 FORMER COMPANY: FORMER CONFORMED NAME: PIERCE LEAHY CORP DATE OF NAME CHANGE: 19960807 8-K 1 v073402_8k.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): May 2, 2007 IRON MOUNTAIN INCORPORATED (Exact name of registrant as specified in its charter) DELAWARE (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) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e- 4(c)) Item 2.02. Results of Operations and Financial Condition. On May 2, 2007, the Company issued a press release setting forth the Company's results of operations and financial condition for its fiscal quarter ended March 31, 2007 and its financial outlook for 2007. A copy of the Company's press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference. Item 9.01. Financial Statements and Exhibits. (d) Exhibits 99.1 Press Release of Iron Mountain Incorporated dated May 2, 2007 (furnished herewith). 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/ Brian McKeon ----------------------------------- Name: Brian McKeon Title: EVP and Chief Financial Officer Date: May 2, 2007 EX-99.1 2 v073402_ex99-1.txt Iron Mountain Incorporated Reports First Quarter 2007 Financial Results * Total revenues up 12% to $633 million driven by strong service revenue growth and the 73rd consecutive quarter of increased storage revenues * OIBDA is $157 million, or 24.8% of revenues; strong performance supported by revenue growth and timing and control of expenses * Operating income is $100 million and net income is up 27% to $35 million or $0.17 per diluted share * The Company raises full year guidance BOSTON, May 2 /PRNewswire-FirstCall/ -- Iron Mountain Incorporated (NYSE: IRM), the global leader in information protection and storage services, today announced its financial results for the first quarter ended March 31, 2007, reporting strong overall revenue performance, solid operating income and net income for the quarter of $0.17 per diluted share. The Company also announced the signing of a definitive agreement to acquire ArchivesOne, Inc., a leading provider of records and information management services in the United States. Strong revenue performance, supported by solid storage revenue growth and robust service revenue growth, highlighted Iron Mountain's financial results for the first quarter of 2007 and was a contributing factor in driving up operating income before depreciation and amortization ("OIBDA"). Expense control and the timing of initiative spending were also positive contributors to the Company's operating performance. Iron Mountain was very active in the capital markets in early 2007 as the Company continued the implementation of a multi-phase global treasury program designed to create financial flexibility, reduce foreign exchange risk and drive annual cash savings. In late 2006, the Company established an international treasury center in Switzerland to more effectively and efficiently manage the financing needs of its international subsidiaries outside of North America, initially in Europe. This was followed in the first quarter of 2007 by successful senior subordinated debt offerings in Euros (euro 225 million) and Canadian Dollars (C$175 million). In April 2007, the Company closed on a $900 million global senior credit facility which consolidated its existing senior credit facilities in the U.S. and the U.K. "We are pleased with the performance of the business thus far, as well as the ultimate potential of the markets we serve," said Richard Reese, Chairman and CEO. "Our strong balance sheet will allow us to address an expanding set of growth, productivity and acquisition investment opportunities in the near to medium term. Capitalizing on these opportunities will enhance our ability to drive long term, increasingly profitable growth and therefore, shareholder value." Iron Mountain's total consolidated revenues for the quarter ended March 31, 2007 grew to $633 million, an increase of 12% compared to the quarter ended March 31, 2006. For the quarter, storage revenues grew 10% and service revenues grew 15% compared to the same period in 2006. For the first quarter of 2007, the storage and service revenue internal growth rates were 9% and 10%, respectively, yielding a total internal revenue growth rate of 9%. OIBDA was $157 million, or 24.8% of revenues, for the quarter ended March 31, 2007 compared to $142 million, or 25.2% of revenues, for the quarter ended March 31, 2006. See Appendix A at the end of this press release for a discussion of OIBDA and the required reconciliation to the appropriate GAAP measures. Operating income for the first quarter of 2007 was $100 million, or 16% of revenues, compared to $92 million, or 16% of revenues, for the same period in 2006. Net income for the quarter was $35 million, or $0.17 per diluted share, compared to $27 million, or $0.14 per diluted share, for the same period in 2006. All per share amounts have been adjusted to reflect the three-for-two stock split effected in the form of a stock dividend on December 29, 2006. Included in net income for the quarter of 2007 is $8 million, or $0.02 per diluted share, of other income, net comprised primarily of $9 million of business interruption insurance recoveries related to the London warehouse fire of July 2006, offset by $2 million of early debt extinguishment charges related to our first quarter refinancing activities. Net foreign currency gains for the three months ended March 31, 2007 were negligible. Included in net income for the first quarter of 2006, is $3 million, or $0.01 per diluted share, of other income, net comprised of $1 million of foreign currency related gains and $2 million of other non-operating net gains. The foreign currency related gains were due primarily to the strengthening of the British Pound Sterling and the Euro partially offset by a weakening of the Australian Dollar. Iron Mountain's acquisition strategy focuses on acquiring attractive businesses that provide a strong platform for future growth by expanding the Company's geographic footprint and service offerings while enhancing its existing operations. Since the end of 2006, the Company completed several small shredding and records management business acquisitions in North America and the U.K. The Company also signed a definitive agreement to acquire ArchivesOne, Inc., a leading provider of records and information management services in the United States and acquired Societa Italiana Archivi s.p.a. in Italy and Gesellschaft fur beleglose Dokumentenbearbeitung gmbh ("GbD") in Germany. The ArchivesOne transaction is subject to customary closing conditions and is expected to be completed in May 2007. Founded in 1991, ArchivesOne, is a leading records management company based in Middlebury, Connecticut, that serves a customer base of more than 8,500 customers in a variety of sectors including professional services, healthcare, legal and finance. With 31 facilities located in 17 major metropolitan markets in 10 states and the District of Columbia, ArchivesOne will be an important addition to the Company in the U.S. For nearly 15 years Italiana Archivi has been providing records management and DMS solutions to government, finance and other corporate customers throughout Italy. Italiana Archivi gives Iron Mountain a strong national presence in Italy with operations in five major markets: Rome, Venice, Milan, Naples and Aosta. Based in Hamburg, Germany, GbD provides document management solutions specializing in scanning, processing and the subsequent archiving of corporate documents. Iron Mountain was advised exclusively by Lehman Brothers Inc. on the ArchivesOne transaction. Financial Performance Outlook The following statements are based on current expectations and do not include the potential impact of any future acquisitions, except those discussed above. 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. Except as required by law, the Company undertakes no obligation to update this information (dollars in millions): Full Year Ending December 31, 2007 Quarter Ending June 30, 2007 Previous Current Low High Low High Low High Revenues $647 $662 $2,530 $2,600 $2,600 $2,660 Operating Income 103 110 427 452 434 457 Depreciation & Amortization ~58 223 228 231 236 Capital Expenditures 390 420 395 425 Internal Revenue Growth 8% 10% 8% 10% Iron Mountain's conference call to discuss its first quarter 2007 financial results will be held today at 11:00 a.m. Eastern Time. In order to further enhance the overall quality of its investor communications, the Company will simulcast the conference call on its Web site at http://www.ironmountain.com, the content of which is not part of this earnings release. A slide presentation providing summary financial and statistical information that will be discussed on the conference call will also be posted to the Web site and available for real-time viewing. The slide presentation and replays of the conference call will be available on the Web site for future reference. About Iron Mountain Iron Mountain Incorporated (NYSE: IRM) helps organizations around the world reduce the costs and risks associated with information protection and storage. The Company offers comprehensive records management and data protection solutions, along with the expertise and experience to address complex information challenges such as rising storage costs, litigation, regulatory compliance and disaster recovery. Founded in 1951, Iron Mountain is a trusted partner to more than 100,000 corporate clients throughout North America, Europe, Latin America and Asia Pacific. For more information, visit the Company's Web site at http://www.ironmountain.com. Forward Looking Statements This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and federal securities laws, and is subject to the safe-harbor created by such Act. Forward-looking statements include our 2007 financial performance outlook and statements regarding our goals, beliefs, future growth strategies, investments, 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) in the various digital businesses in which the Company is engaged, 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; (iv) the cost to comply with current and future legislation or regulation relating to privacy issues; (v) the impact of litigation that may arise in connection with incidents of inadvertent disclosures of customers' confidential information; (vi) the Company's ability or inability to complete acquisitions on satisfactory terms and to integrate acquired companies efficiently; (vii) the cost and availability of financing for contemplated growth; (viii) business partners upon which the Company depends for technical assistance or management and acquisition expertise outside the United States will not perform as anticipated; (ix) changes in the political and economic environments in the countries in which the Company's international subsidiaries operate; (x) other trends in competitive or economic conditions affecting Iron Mountain's financial condition or results of operations not presently contemplated; and (xi) other risks described more fully in the Company's Annual Report on Form 10-K for the year ended December 31, 2006 under "Item 1A. Risk Factors". Except as required by law, 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. Investor Relations Contact: Stephen P. Golden Director, Investor Relations sgolden@ironmountain.com (617) 535-4799 Iron Mountain Incorporated Condensed Consolidated Statements of Operations (Amounts in Thousands except Per Share Data) (Unaudited) Three Months Ended March 31, 2006 2007 Revenues: Storage $319,155 $352,165 Service and Storage Material Sales 244,502 280,347 Total Revenues 563,657 632,512 Operating Expenses: Cost of Sales (Excluding Depreciation and Amortization) 262,368 295,005 Selling, General and Administrative 158,843 180,505 Depreciation and Amortization 49,848 57,172 Loss on Disposal / Writedown of Property, Plant and Equipment, Net 163 37 Total Operating Expenses 471,222 532,719 Operating Income 92,435 99,793 Interest Expense, Net 46,578 50,335 Other Income, Net (2,847) (7,723) Income Before Provision for Income Taxes and Minority Interest 48,704 57,181 Provision for Income Taxes 20,971 22,083 Minority Interest in Earnings of Subsidiaries, Net 460 391 Net Income $ 27,273 $ 34,707 Net Income Per Share - Basic $0.14 $0.17 Net Income Per Share - Diluted $0.14 $0.17 Weighted Average Common Shares Outstanding - Basic 197,522 199,230 Weighted Average Common Shares Outstanding - Diluted 199,971 201,416 Operating Income before Depreciation and Amortization $142,283 $156,965 Iron Mountain Incorporated Condensed Consolidated Balance Sheets (Amounts in Thousands) (Unaudited) December 31, March 31, 2006 2007 ASSETS Current Assets: Cash and Cash Equivalents $ 45,369 $ 61,481 Accounts Receivable (less allowances of $15,157 and $15,106, respectively) 473,366 485,687 Other Current Assets 160,986 120,424 Total Current Assets 679,721 667,592 Property, Plant and Equipment: Property, Plant and Equipment at Cost 2,965,995 3,051,944 Less: Accumulated Depreciation (950,760) (1,004,328) Property, Plant and Equipment, net 2,015,235 2,047,616 Other Assets: Goodwill, net 2,165,129 2,195,256 Other Non-current Assets, net 349,436 359,267 Total Other Assets 2,514,565 2,554,523 Total Assets $5,209,521 $5,269,731 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Current Portion of Long-term Debt $ 63,105 $ 99,883 Other Current Liabilities 575,542 565,812 Total Current Liabilities 638,647 665,695 Long-term Debt, Net of Current Portion 2,605,711 2,592,719 Other Long-term Liabilities 406,600 418,305 Minority Interests 5,290 5,503 Stockholders' Equity 1,553,273 1,587,509 Total Liabilities and Stockholders' Equity $5,209,521 $5,269,731 APPENDIX A Operating Income Before Depreciation and Amortization The Company uses Operating Income Before Depreciation and Amortization ("OIBDA"), an integral part of its planning and reporting systems, to evaluate the operating performance of the consolidated business. As such, the Company believes OIBDA provides current and potential investors with relevant and useful information regarding its ability to grow revenues faster than operating expenses. Additionally, the Company uses multiples of current and projected OIBDA in conjunction with its discounted cash flow models to determine its overall enterprise valuation and to evaluate acquisition targets. OIBDA is not a measurement of financial performance under accounting principles generally accepted in the United States, or GAAP, and should not be considered as a substitute for operating or net income or cash flows from operating activities (as determined in accordance with GAAP). Following is a reconciliation of operating income before depreciation and amortization to operating income and net income (in millions): Three Months Ended March 31, 2006 2007 OIBDA (Operating Income Before Depreciation and Amortization) (1) $142 $157 Less: Depreciation and Amortization 50 57 Operating Income (1) $ 92 $100 Less: Interest Expense, net 47 50 Other (Income), net (3) (8) Provision for Income Taxes 21 22 Minority Interest -- -- Net Income (1) $ 27 $ 35 Major Components of Other (Income) Expense, net: Foreign Currency Exchange Effects: $ (1) $ -- Debt Extinguishment Charges, net: $ -- $ 2 Insurance related gains $ -- $ (9) (1) Columns may not foot due to rounding. Free Cash Flows Before Acquisitions and Discretionary Investments, or FCF FCF is defined as Cash Flows From Operating Activities less capital expenditures (excluding real estate), net of proceeds from the sales of property and equipment and other, net, and additions to customer acquisition costs. Our management uses this measure when evaluating the operating performance and profitability of our consolidated business. FCF is a useful measure in determining our ability to generate cash flows in excess of our capital expenditures (both growth and maintenance) and our customer acquisition costs. As such, we believe this measure provides relevant and useful information to our current and potential investors. FCF should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as cash flows from operating activities (as determined in accordance with GAAP). Following is a reconciliation of Free Cash Flows Before Acquisitions and Discretionary Investments to Cash Flows from Operating Activities (in millions): Three Months Ended March 31, 2006 2007 Free Cash Flows Before Acquisitions and Discretionary Investments $(12) $ 33 Add: Capital Expenditures (excluding real estate), net 71 66 Additions to Customer Acquisition Costs 3 3 Cash Flows From Operating Activities (2) $ 62 $102 (2) Columns may not foot due to rounding. SOURCE Iron Mountain Incorporated -0- 05/02/2007 /CONTACT: Investor Relations Contact: Stephen P. Golden, Director, Investor Relations, sgolden@ironmountain.com, +1-617-535-4799/ /Web site: http://www.ironmountain.com / (IRM) -----END PRIVACY-ENHANCED MESSAGE-----