-----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, J1pGy/K9spSmg6fZmO04Ek1NLgRcUNjGgDEmVxOySOomeia4wXiO9IUmSg9EnsEp 2YGF9FNo5UodJDxVt1amOA== 0001275287-07-000996.txt : 20070228 0001275287-07-000996.hdr.sgml : 20070228 20070228083107 ACCESSION NUMBER: 0001275287-07-000996 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20070228 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070228 DATE AS OF CHANGE: 20070228 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: 07655233 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 im9103.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): February 28, 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 (see General Instruction A.2.): [ ] 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 (7 CFR 240.13e-4(c)) ================================================================================ ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On February 28, 2007, the Company issued a press release setting forth the Company's results of operations and financial condition for its fiscal quarter and full fiscal year ended December 31, 2006 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 February 28, 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/ John F. Kenny, Jr. ------------------------------- Name: John F. Kenny, Jr. Title: EVP and Chief Financial Officer Date: February 28, 2007 EX-99.1 2 im9103ex991.txt EXHIBIT 99.1 Exhibit 99.1 IRON MOUNTAIN INCORPORATED REPORTS FOURTH QUARTER 2006 FINANCIAL RESULTS Company Issues 2007 Full-Year Guidance * Total Revenues are $610 Million, Up 13% * Operating Income is $115 Million * OIBDA is $169 Million; 27.7% of Revenues * Net Income is $0.18 per Diluted Share BOSTON, Feb. 28 /PRNewswire-FirstCall/ -- Iron Mountain Incorporated (NYSE: IRM), the global leader in information protection and storage services, today announced its financial results for the fourth quarter ended December 31, 2006, reporting higher revenues, strong storage internal revenue growth and net income for the quarter of $0.18 per diluted share. Iron Mountain's total consolidated revenues for the quarter ended December 31, 2006 grew to $610 million, an increase of 13% compared to the quarter ended December 31, 2005. For the quarter, storage revenues grew 11% and service revenues grew 16% compared to the same period in 2005. Storage revenues, which are considered a key performance indicator for the information protection and storage services industry, are largely recurring since customers typically retain their records for many years. This marks the 72nd consecutive quarter for which the Company has reported increased storage revenues. For the fourth quarter of 2006, the storage and service revenue internal growth rates were 10% and 10%, respectively, yielding a total internal revenue growth rate of 10%. The total core storage and services revenue internal growth rate was 9% for the quarter. "2006 was another solid year for Iron Mountain, highlighted by strong internal revenue growth rates, particularly in storage revenue, a key driver of our business, as our customer facing investments continue to generate the expected results," stated Richard Reese, the Company's Chairman and CEO. "The opportunities before us are many and we are aggressively investing in those that hold the greatest potential for driving long-term, increasingly profitable growth and ultimately higher shareholder value." Operating income before depreciation and amortization ("OIBDA") was $169 million, or 27.7% of revenues, for the quarter ended December 31, 2006 compared to $149 million, or 27.6% of revenues, for the quarter ended December 31, 2005. Included in OIBDA for the quarter ended December 31, 2006 is $10 million, or $0.03 per diluted share, of gains related to the sale of real estate compared to $4 million, or $0.01 per diluted share, for the quarter ended December 31, 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 fourth quarter of 2006 was $115 million, or 19% of revenues, compared to $97 million, or 18% of revenues, for the same period in 2005. Net income for the quarter was $37 million, or $0.18 per diluted share, compared to $26 million, or $0.13 per diluted share, for the same period in 2005. All per share amounts have been restated 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 is $3 million, or $0.01 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 compared to September 30, 2006. Included in net income for the quarter ended December 31, 2005, is $3 million, or $0.01 per diluted share, of other expense, net comprised primarily of foreign currency related net losses, due mainly to the weakening of the Euro and the British Pound Sterling. For the twelve months ended December 31, 2006, the Company reported total consolidated revenues of $2.4 billion, an increase of 13% compared to the prior year. Storage revenues and service revenues grew 12% and 14%, respectively, for the twelve months of 2006 compared to the prior year. For the year, storage and service revenue internal growth rates were 10% and 7%, respectively, yielding a total internal revenue growth rate of 9%. OIBDA was $616 million, or 26.2% of revenues, for the year ended December 31, 2006 compared to $574 million, or 27.6% of revenues, for the year ended December 31, 2005. Included in OIBDA for the year ended December 31, 2006 is $10 million, or $0.03 per diluted share, of net gains related primarily to the sale of real estate compared to $3 million, or $0.01 per diluted share, for the year ended December 31, 2005. Operating income for the twelve months of 2006 was $407 million, or 17% of revenues, compared to $387 million, or 19% of revenues, for 2005. Net income was $129 million, or $0.64 per diluted share, for 2006, compared to $111 million, or $0.56 per diluted share, for 2005. Included in net income for the twelve months ended December 31, 2006, is $12 million, or $0.03 per diluted share, of other income, net comprised primarily of foreign currency related net gains, due mainly to the strengthening of the British Pound Sterling, partially offset by charges related to the early extinguishment of debt associated with the Company's financing activities. Included in net income for the twelve months ended December 31, 2005, is $6 million, or $0.02 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 and the Euro offset by the strengthening of the Canadian Dollar. 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 service offerings while enhancing its existing operations. Since the end of the third quarter, the Company completed several small shredding and records management business acquisitions in North America and acquired a 50.1% equity interest in Transnational Company Pte. Ltd. Established in 1978, Transnational Company Pte. Ltd. is headquartered in Singapore and is a provider of information protection and storage services in Singapore, Hong Kong-SAR, China, Indonesia, Sri Lanka, Taiwan, and Malaysia. 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. Except as required by law, the Company undertakes no obligation to update this information (dollars in millions): Quarter Ending Full Year Ending March 31, 2007 December 31, 2007 ------------------- ------------------- Low High Low High -------- -------- -------- -------- Revenues $ 615 $ 630 $ 2,530 $ 2,600 Operating Income 92 99 427 452 Depreciation & Amortization ~55 223 228 Capital Expenditures 390 420 Internal Revenue Growth 8% 10% Iron Mountain's conference call to discuss its fourth quarter 2006 financial results and 2007 financial guidance will be held today at 10:30 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 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. 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, 2005 under "Item 1A. Risk Factors" and our Current Report on Form 8-K filed on July 11, 2006. 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 Twelve Months Ended December 31, December 31, ------------------------- ------------------------- 2005 2006 2005 2006 ----------- ----------- ----------- ----------- Revenues: Storage $ 307,746 $ 341,838 $ 1,181,551 $ 1,327,169 Service and Storage Material Sales 230,609 267,669 896,604 1,023,173 Total Revenues 538,355 609,507 2,078,155 2,350,342 Operating Expenses: Cost of Sales (Excluding Depreciation and Amortization) 242,109 275,383 938,239 1,074,268 Selling, General and Administrative 151,600 175,344 569,695 670,074 Depreciation and Amortization 51,933 54,106 186,922 208,373 Gain on Disposal / Writedown of Property, Plant and Equipment, Net (4,091) (10,054) (3,485) (9,560) Total Operating Expenses 441,551 494,779 1,691,371 1,943,155 Operating Income 96,804 114,728 386,784 407,187 Interest Expense, Net 46,248 50,664 183,584 194,958 Other Expense (Income), Net 3,115 (2,867) 6,182 (11,989) Income Before Provision for Income Taxes and Minority Interest 47,441 66,931 197,018 224,218 Provision for Income Taxes 17,745 29,407 81,484 93,795 Minority Interests in Earnings of Subsidiaries, net 582 389 1,684 1,560 Income Before Cumulative Effect of Change in Accounting Principle 29,114 37,135 113,850 128,863 Cumulative Effect of Change in Accounting Principle, net of tax benefit 2,751 -- 2,751 -- Net Income $ 26,363 $ 37,135 $ 111,099 $ 128,863 Net Income Per Share - - Basic: Income Before Cumulative Effect of Change in Accounting Principle $ 0.15 $ 0.19 $ 0.58 $ 0.65 Cumulative Effect of Change in Accounting Principle, Net of Tax Benefit (0.01) -- (0.01) -- Net Income Per Share - - Basic $ 0.13 $ 0.19 $ 0.57 $ 0.65 Net Income Per Share - - Diluted: Income Before Cumulative Effect of Change in Accounting Principle $ 0.15 $ 0.18 $ 0.57 $ 0.64 Cumulative Effect of Change in Accounting Principle, Net of Tax Benefit (0.01) -- (0.01) -- Net Income Per Share - - Diluted $ 0.13 $ 0.18 $ 0.56 $ 0.64 Weighted Average Common Shares Outstanding - Basic 196,976 198,740 195,988 198,116 Weighted Average Common Shares Outstanding - Diluted 199,512 201,129 198,104 200,463 Operating Income before Depreciation and Amortization $ 148,737 $ 168,834 $ 573,706 $ 615,560
Iron Mountain Incorporated Condensed Consolidated Balance Sheets (Amounts in Thousands) (Unaudited) December 31, December 31, 2005 2006 ------------ ------------ ASSETS Current Assets: Cash and Cash Equivalents $ 53,413 $ 45,369 Accounts Receivable (less allowances of $14,522 and $15,157, respectively) 408,564 473,366 Other Current Assets 92,191 160,986 Total Current Assets 554,168 679,721 Property, Plant and Equipment: Property, Plant and Equipment at Cost 2,556,880 2,965,995 Less: Accumulated Depreciation (775,614) (950,760) Property, Plant and Equipment, net 1,781,266 2,015,235 Other Assets: Goodwill, net 2,138,641 2,165,129 Other Non-current Assets, net 292,065 349,436 Total Other Assets 2,430,706 2,514,565 Total Assets $ 4,766,140 $ 5,209,521 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Current Portion of Long-term Debt $ 25,905 $ 63,105 Other Current Liabilities 566,091 575,542 Total Current Liabilities 591,996 638,647 Long-term Debt, Net of Current Portion 2,503,526 2,605,711 Other Long-term Liabilities 294,622 406,600 Minority Interests 5,867 5,290 Stockholders' Equity 1,370,129 1,553,273 Total Liabilities and Stockholders' Equity $ 4,766,140 $ 5,209,521 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 Full Year Ended December 31, December 31, ------------------- ------------------- 2005 2006 2005 2006 -------- -------- -------- -------- OIBDA (Operating Income Before Depreciation and Amortization) (1) $ 149 $ 169 $ 574 $ 616 Less: Depreciation and Amortization 52 54 187 208 Operating Income (1) $ 97 $ 115 $ 387 $ 407 Less: Interest Expense, net 46 51 184 195 Other Expense (Income), net 3 (3) 6 (12) Provision for Income Taxes 18 29 81 94 Minority Interest 1 -- 2 2 Cumulative Effect of Change in Accounting Principle 3 -- 3 -- Net Income (1) $ 26 $ 37 $ 111 $ 129 Foreign Currency Impact on Other Expense (Income), net: $ 3 $ (2) $ 7 $ (13) Debt Extinguishment Charges Included in Other Expense (Income), net: $ -- $ -- $ -- $ 3
(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): Year Ended December 31, ------------------- 2005 2006 -------- -------- Free Cash Flows Before Acquisitions and Investments $ 120 $ (4) Add: Capital Expenditures, net 244 364 Additions to Customer Acquisition Costs 13 14 Cash Flows From Operating Activities (2) $ 377 $ 374 (2) Columns may not foot due to rounding. SOURCE Iron Mountain Incorporated -0- 02/28/2007 /CONTACT: Investor Relations, Stephen P. Golden, Director, Investor Relations of Iron Mountain Incorporated, +1-617-535-4799, or sgolden@ironmountain.com / /Web site: http://www.ironmountain.com / (IRM) -----END PRIVACY-ENHANCED MESSAGE-----