-----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, M8jr6f58mnIy1CUSzXWZlPurx7eloAZw/GYTUwh9el2r22dfpqyZdxwEfcbDbBBQ DzxhliVK3yEiAENFxpbbGg== 0001275287-06-003886.txt : 20060727 0001275287-06-003886.hdr.sgml : 20060727 20060727100215 ACCESSION NUMBER: 0001275287-06-003886 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060727 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060727 DATE AS OF CHANGE: 20060727 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: 06983236 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 im6552.txt FORM 8-K ================================================================================ 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): JULY 27, 2006 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 (see General Instruction A.2. below): [ ] 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 July 27, 2006, the Company issued a press release setting forth the Company's results of operations and financial condition for its second fiscal quarter ended June 30, 2006. 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 July 27, 2006 (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/ John F. Kenny, Jr. ------------------------------- Name: John F. Kenny, Jr. Title: EVP and Chief Financial Officer Date: July 27, 2006 EX-99.1 2 im6552ex991.txt EXHIBIT 99.1 Exhibit 99.1 Iron Mountain Incorporated Reports Second Quarter 2006 Financial Results - Total Revenues are $582 Million, Up 14% - Operating Income is $103 Million - OIBDA is $154 Million; 26.5% of Revenues - Net Income is $0.28 per Diluted Share BOSTON, July 27 /PRNewswire-FirstCall/ -- Iron Mountain Incorporated (NYSE: IRM), the global leader in information protection and storage services, today announced its financial results for the second quarter ended June 30, 2006, reporting higher revenues, strong internal revenue growth and net income for the quarter of $0.28 per diluted share. Iron Mountain's total consolidated revenues for the quarter ended June 30, 2006 grew to $582 million, an increase of 14% compared to the quarter ended June 30, 2005. For the quarter, storage revenues grew 12% and service revenues grew 15% compared to the same period in 2005. Storage revenues, which are considered a key performance indicator for the records management and data protection services industry, are largely recurring since customers typically retain their records for many years. This marks the 70th consecutive quarter for which the Company has reported increased storage revenues. For the second quarter of 2006, the storage and service revenue internal growth rates were 11% and 8%, respectively, yielding a total internal revenue growth rate of 9%. The total core storage and services revenue internal growth rate was 10% for the quarter. "Our business is performing well across geographies and service lines led by strong revenue growth, particularly storage revenues, the key driver of our business. We continue making the investments we believe will further enhance our ability to capture the tremendous market opportunity we see before us and drive future revenue growth and profitability," stated Richard Reese, the Company's Chairman and CEO. Operating income before depreciation and amortization ("OIBDA") was $154 million, or 26.5% of revenues, for the quarter ended June 30, 2006 compared to $141 million, or 27.6% of revenues, for the quarter ended June 30, 2005. 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 second quarter of 2006 was $103 million, or 18% of revenues, compared to $97 million, or 19% of revenues, for the same period in 2005. Net income for the quarter was $38 million, or $0.28 per diluted share, compared to $25 million, or $0.19 per diluted share, for the same period in 2005. Included in net income for the quarter is $7 million, or $0.03 per diluted share, of other income, net comprised of foreign currency related net gains. The foreign currency related gains were due primarily to the strengthening of the British Pound Sterling and the Canadian Dollar compared to March 31, 2006. Included in net income for the quarter ended June 30, 2005, is $5 million, or $0.02 per diluted share, of other expense, net comprised primarily of foreign currency related net losses, due primarily to the weakening of the British Pound Sterling and the Euro. For the six months ended June 30, 2006, the Company reported total consolidated revenues of $1.1 billion, an increase of 13%, with storage revenues growing at 12% and service revenues growing at 14% compared to the prior year. For the first six months of the year, storage and service revenue internal growth rates were 11% and 8%, respectively, yielding a total internal revenue growth rate of 9%. OIBDA was $296 million, or 25.9% of revenues, for the six months ended June 30, 2006 compared to $277 million, or 27.3% of revenues, for the six months ended June 30, 2005. Operating income for the first six months of 2006 was $195 million, or 17% of revenues, compared to $188 million, or 19% of revenues, for 2005. Net income was $65 million, or $0.49 per diluted share, for the first six months of 2006, compared to $48 million, or $0.37 per diluted share, for the comparable period in 2005. Included in net income for the six months ended June 30, 2006, is $10 million, or $0.04 per diluted share, of other income, net comprised primarily of foreign currency related net gains, due primarily to the strengthening of the British Pound Sterling and the Canadian Dollar. Included in net income for the six months ended June 30, 2005, is $10 million, or $0.04 per diluted share, of other expense, net comprised almost exclusively of foreign currency related net losses, due primarily to the weakening of the British Pound Sterling, the Canadian Dollar and the Euro. In line with its strategy, Iron Mountain acquires attractive businesses that provide a strong platform for future growth by expanding the Company's geographic footprint and information protection and storage service offerings while enhancing its existing operations. Since the end of the first quarter, the Company has completed several acquisitions including a 50.1% joint venture in India, a leading data protection business in Australia/New Zealand, a document management services business in Brazil, and several small shredding and records management businesses in North America. 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 (dollars in millions):
Quarter Ending Full Year Ending December 31, 2006 September 30, ------------------------------------------- 2006 Previous Current -------------------- -------------------- ------------------- Low High Low High Low High -------- -------- -------- -------- -------- -------- Revenues $ 582 $ 596 $ 2,270 $ 2,320 $ 2,270 $ 2,320 Operating Income 97 104 382 403 382 403 Depreciation & Amortization ~53 208 212 208 212 Capital Expenditures 320 360 320 360 Internal revenue Growth 7% 9% 7% 9%
Iron Mountain's conference call to discuss the second quarter of 2006 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 website 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 90,000 corporate clients throughout North America, Europe, Latin America and Asia Pacific. For more information, visit the Company's Web site at 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 federal securities laws, and is subject to the safe-harbor created by such Act. Forward-looking statements include our 2006 financial performance outlook and statements regarding our goals, beliefs, future growth 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) 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; and (x) 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 Incorporated Condensed Consolidated Statements of Operations (Amounts in Thousands except Per Share Data) (Unaudited)
Three Months Ended Six Months Ended June 30, June 30, ------------------------- ------------------------- 2005 2006 2005 2006 ----------- ----------- ----------- ----------- Revenues: Storage $ 291,666 $ 327,863 $ 577,021 $ 647,018 Service and Storage Material Sales 220,256 253,705 436,307 498,207 Total Revenues 511,922 581,568 1,013,328 1,145,225 Operating Expenses: Cost of Sales (Excluding Depreciation) 228,088 259,290 458,716 521,658 Selling, General and Administrative 141,313 168,285 276,653 327,128 Depreciation and Amortization 44,745 51,273 89,291 101,121 Loss (Gain) on Disposal / Writedown of Property, Plant and Equipment, Net 1,083 (174) 865 (11) Total Operating Expenses 415,229 478,674 825,525 949,896 Operating Income 96,693 102,894 187,803 195,329 Interest Expense, Net 47,222 47,254 93,028 93,832 Other Expense (Income), Net 4,946 (6,858) 9,609 (9,705) Income Before Provision for Income Taxes and Minority Interest 44,525 62,498 85,166 111,202 Provision for Income Taxes 18,866 24,212 36,102 45,183 Minority Interest in Earnings of Subsidiaries, net 249 444 705 904 Net Income $ 25,410 $ 37,842 $ 48,359 $ 65,115 Net Income Per Share - Basic $ 0.19 $ 0.29 $ 0.37 $ 0.49 Net Income Per Share - Diluted $ 0.19 $ 0.28 $ 0.37 $ 0.49 Weighted Average Common Shares Outstanding - Basic 130,474 131,929 130,228 131,805 Weighted Average Common Shares Outstanding - Diluted 131,470 133,445 131,494 133,379 Operating Income before Depreciation and Amortization $ 141,438 $ 154,167 $ 277,094 $ 296,450
Iron Mountain Incorporated Condensed Consolidated Balance Sheets (Amounts in Thousands) (Unaudited) December 31, June 30, 2005 2006 ------------- -------------- ASSETS Current Assets: Cash and Cash Equivalents $ 53,413 $ 40,952 Accounts Receivable (less allowances of $14,522 and $14,181, respectively) 408,564 440,285 Other Current Assets 92,191 108,359 Total Current Assets 554,168 589,596 Property, Plant and Equipment: Property, Plant and Equipment at Cost 2,556,880 2,746,506 Less: Accumulated Depreciation (775,614) (870,990) Property, Plant and Equipment, net 1,781,266 1,875,516 Other Assets: Goodwill, net 2,138,641 2,186,367 Other Non-current Assets, net 292,065 305,433 Total Other Assets 2,430,706 2,491,800 Total Assets $ 4,766,140 $ 4,956,912 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Current Portion of Long-term Debt $ 25,905 $ 65,762 Other Current Liabilities 566,091 543,452 Total Current Liabilities 591,996 609,214 Long-term Debt, Net of Current Portion 2,503,526 2,541,996 Other Long-term Liabilities 294,622 337,016 Minority Interests 5,867 5,083 Stockholders' Equity 1,370,129 1,463,603 Total Liabilities and Stockholders' Equity $ 4,766,140 $ 4,956,912 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 Six Months Ended June 30, June 30, ------------------- ------------------- 2005 2006 2005 2006 -------- -------- -------- -------- OIBDA (Operating Income Before Depreciation and Amortization) (1) $ 141 $ 154 $ 277 $ 296 Less: Depreciation and Amortization 45 51 89 101 Operating Income (1) $ 97 $ 103 $ 188 $ 195 Less: Interest Expense, net 47 47 93 94 Other Expense (Income), net 5 (7) 10 (10) Provision for Income Taxes 19 24 36 45 Minority Interest -- -- 1 1 Net Income (1) $ 25 $ 38 $ 48 $ 65 Major Components of Other (Income) Expense, net: Foreign Exchange Effects $ 5 $ (7) $ 10 $ (9)
(1) Columns may not foot due to rounding. Free Cash Flows Before Acquisitions and Investments, or FCF FCF is defined as Cash Flows From Operating Activities less capital expenditures, 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 Investments to Cash Flows from Operating Activities (in millions): Six Months Ended June 30, ----------------- 2005 2006 ------- ------- Free Cash Flows Before Acquisitions and Investments $ 54 $ 13 Add: Capital Expenditures, net 131 154 Additions to Customer Acquisition Costs 7 7 Cash Flows From Operating Activities (2) $ 191 $ 174 Cash Paid for Acquisitions and Investments, net $ 35 $ 74 (2) Columns may not foot due to rounding. Investor Relations Contact: Stephen P. Golden Director, Investor Relations sgolden@ironmountain.com (617) 535-4799 SOURCE Iron Mountain Incorporated -0- 07/27/2006 /CONTACT: Stephen P. Golden, Director, Investor Relations, Iron Mountain Incorporated, sgolden@ironmountain.com, +1-617-535-4799/ /Web site: http://www.ironmountain.com / -----END PRIVACY-ENHANCED MESSAGE-----