(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification Number) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Page No. | ||||||||
2020 Q3 10-Q Report | Stericycle, Inc. ● | 2 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 3 |
Abbreviation | Description | ||||
2019 Form 10-K | Annual report on Form 10-K for the year ended December 31, 2019 | ||||
Adjusted Income from Operations | Income from Operations adjusted for certain items discussed in Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations | ||||
ASC 740 | Accounting Standards Codification Topic 740 "Income Taxes" | ||||
ASEA | Security, Energy and Environmental Agency | ||||
ASU | Accounting Standards Update | ||||
Buyer | Harsco Corporation and CEI Holding LLC, a Delaware limited liability company and subsidiary of Harsco Corporation | ||||
CARES Act | U.S. Coronavirus Aid, Relief, and Economic Security Act enacted into law on March 27, 2020 | ||||
Clean Air Act | The Clean Air Act of 1970 | ||||
Consolidated Leverage Ratio | Consolidated Leverage Ratio means, as of any date of determination, the ratio of (a) (i) Consolidated Funded Indebtedness as of such date minus (ii) Unrestricted Cash as of such date to (b) Consolidated EBITDA for the period of four fiscal quarters most recently ended on or prior to such date, as defined in the Fifth Amendment. | ||||
COR | Cost of revenues | ||||
COSO Framework | Internal Control Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission | ||||
COVID-19 | The global novel coronavirus disease 2019 outbreak, which the World Health Organization declared as to be a pandemic | ||||
Credit Agreement | Credit Agreement dated November 17, 2017 by and among the Company and certain of its subsidiaries named therein, Bank of America, N.A., as administrative agent, and the other financial institutions party thereto | ||||
CRS | Communication and Related Services | ||||
DAQ | Division of Air Quality | ||||
DEA | U.S. Drug Enforcement Agency | ||||
Disposal Group | The divestiture of Domestic Environmental Solutions | ||||
DOJ | U.S. Department of Justice | ||||
Domestic Environmental Solutions | Hazardous Waste Solutions and Manufacturing and Industrial Services | ||||
DSO | Days Sales Outstanding, defined as the average number of days that it takes a company to collect payment after a sale has been made computed as the last twelve months of Revenues for the quarter and period ended DSO, respectively, divided by the Accounts Receivable balance. | ||||
DTSC | Department of Toxic Substances Control | ||||
EBITDA | Earnings before interest, tax, depreciation and amortization | ||||
EPA | U.S. Environmental Protection Agency | ||||
ERP | Enterprise Resource Planning | ||||
Exchange Act | U.S. Securities Exchange Act of 1934 | ||||
Expert Solutions | Recall and Return Services | ||||
FASB | Financial Accounting Standards Board | ||||
FCPA | U.S. Foreign Corrupt Practices Act | ||||
Fourth Amendment | Fourth Amendment to the Credit Agreement, dated as of June 14, 2019 | ||||
Fifth Amendment | Fifth Amendment to the Credit Agreement, dated as of February 25, 2020 | ||||
HSA | Healthcare Service Agreement with Buyer | ||||
International | Operating segment including Europe, Middle East, Asia Pacific and Latin America Business operations outside of North America | ||||
IRS | U.S. Internal Revenue Service | ||||
North America | Operating segment in North America, including Puerto Rico | ||||
NOV | Notice of Violation | ||||
Other | Represents corporate enabling and shared services functions | ||||
PFA | Pre-filing agreement | ||||
Purchase Agreement | Stock Purchase Agreement, dated as of February 6, 2020, by and between Stericycle, Inc., and the Buyer | ||||
PSU | Performance-based restricted stock unit | ||||
ROU | Right-of-use | ||||
RSU | Restricted stock unit | ||||
RWCS | Regulated Waste and Compliance Services | ||||
SEC | U.S. Securities and Exchanges Commission | ||||
Senior Credit Facility | The Company's $1.2 billion senior credit facility due in 2022 granted under the terms of the Credit Agreement | ||||
Senior Notes | 5.375% Senior Notes due July 2024 | ||||
SG&A | Selling, general and administrative expenses | ||||
SID | Secure Information Destruction Services | ||||
SOP | Sorted office paper | ||||
SQ Settlement | Small quantity medical waste customers class action settlement of $295.0 million | ||||
Term Facility | Aggregate amount of commitments made by any lender under the terms of the Credit Agreement | ||||
Term Loans | Advances made by any lender under the Term Facility | ||||
TAS | Telephone answering services | ||||
TSA | Transition Services Agreement with Buyer | ||||
U.K. | United Kingdom | ||||
U.S. | United States of America | ||||
U.S. GAAP | U.S. Generally Accepted Accounting Principles |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 4 |
Item 1. Financial Statements (Unaudited) |
In millions, except per share data | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||||||||||
Cost of revenues | |||||||||||||||||||||||
Gross profit | |||||||||||||||||||||||
Selling, general and administrative expenses | |||||||||||||||||||||||
Divestiture losses (gains), net | |||||||||||||||||||||||
Goodwill impairment | |||||||||||||||||||||||
Loss from operations | ( | ( | ( | ( | |||||||||||||||||||
Interest expense, net | ( | ( | ( | ( | |||||||||||||||||||
Loss on early extinguishment of debt | ( | ||||||||||||||||||||||
Other expense, net | ( | ( | ( | ( | |||||||||||||||||||
Loss before income taxes | ( | ( | ( | ( | |||||||||||||||||||
Income tax (expense) benefit | ( | ||||||||||||||||||||||
Net loss | ( | ( | ( | ( | |||||||||||||||||||
Net income attributable to noncontrolling interests | ( | ( | ( | ( | |||||||||||||||||||
Net loss attributable to Stericycle, Inc. common shareholders | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Loss per common share attributable to Stericycle, Inc. common shareholders: | |||||||||||||||||||||||
Basic | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Diluted | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Weighted average number of common shares outstanding: | |||||||||||||||||||||||
Basic | |||||||||||||||||||||||
Diluted |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 5 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||||||
Currency translation adjustments | ( | ( | |||||||||||||||||||||
Cumulative currency translation loss realized through disposition of Argentina operations | |||||||||||||||||||||||
Amortization of cash flow hedge into income, net of tax expense ($ | |||||||||||||||||||||||
Change in fair value of cash flow hedge, net of tax expense ($ | |||||||||||||||||||||||
Reclassification of cash flow hedge, net of tax expense ($ | |||||||||||||||||||||||
Total other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
Comprehensive income (loss) | ( | ( | ( | ||||||||||||||||||||
Less: comprehensive income attributable to noncontrolling interests | |||||||||||||||||||||||
Comprehensive income (loss) attributable to Stericycle, Inc. common shareholders | $ | $ | ( | $ | ( | $ | ( |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 6 |
In millions, except per share data | |||||||||||
September 30, 2020 | December 31, 2019 | ||||||||||
ASSETS | |||||||||||
Current Assets: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, less allowance for doubtful accounts of $ | |||||||||||
Prepaid expenses | |||||||||||
Other current assets | |||||||||||
Total Current Assets | |||||||||||
Property, plant and equipment, less accumulated depreciation of $ | |||||||||||
Operating lease right-of-use assets | |||||||||||
Goodwill | |||||||||||
Intangible assets, less accumulated amortization of $ | |||||||||||
Other assets | |||||||||||
Total Assets | $ | $ | |||||||||
LIABILITIES AND EQUITY | |||||||||||
Current Liabilities: | |||||||||||
Current portion of long-term debt | $ | $ | |||||||||
Bank overdrafts | |||||||||||
Accounts payable | |||||||||||
Accrued liabilities | |||||||||||
Operating lease liabilities | |||||||||||
Other current liabilities | |||||||||||
Total Current Liabilities | |||||||||||
Long-term debt, net | |||||||||||
Long-term operating lease liabilities | |||||||||||
Deferred income taxes | |||||||||||
Long-term taxes payable | |||||||||||
Other liabilities | |||||||||||
Total Liabilities | |||||||||||
Equity: | |||||||||||
Common stock (par value $ | |||||||||||
Additional paid-in capital | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Total Stericycle, Inc.’s Equity | |||||||||||
Noncontrolling interests | |||||||||||
Total Equity | |||||||||||
Total Liabilities and Equity | $ | $ |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 7 |
In millions | |||||||||||
Nine Months Ended September 30, | |||||||||||
2020 | 2019 | ||||||||||
OPERATING ACTIVITIES: | |||||||||||
Net loss | $ | ( | $ | ( | |||||||
Adjustments to reconcile net loss to net cash from operating activities: | |||||||||||
Depreciation | |||||||||||
Intangible amortization | |||||||||||
Loss on early extinguishment of debt and related charges | |||||||||||
Stock-based compensation expense | |||||||||||
Deferred income taxes | ( | ||||||||||
Goodwill impairment | |||||||||||
Divestiture losses (gains), net | |||||||||||
Asset impairments, loss on disposal of property plant and equipment and other charges | |||||||||||
Other, net | ( | ||||||||||
Changes in operating assets and liabilities, net of the effects of acquisitions and divestitures: | |||||||||||
Accounts receivable | |||||||||||
Prepaid expenses | ( | ||||||||||
Accounts payable | ( | ||||||||||
Accrued liabilities | ( | ||||||||||
Other assets and liabilities | |||||||||||
Net cash from operating activities | |||||||||||
INVESTING ACTIVITIES: | |||||||||||
Capital expenditures | ( | ( | |||||||||
Payments for acquisitions, net of cash acquired | ( | ||||||||||
Proceeds from divestiture of businesses | |||||||||||
Other, net | |||||||||||
Net cash from investing activities | ( | ||||||||||
FINANCING ACTIVITIES: | |||||||||||
Repayments of long-term debt and other obligations | ( | ( | |||||||||
Proceeds from foreign bank debt | |||||||||||
Repayments of foreign bank debt | ( | ( | |||||||||
Proceeds from term loan | |||||||||||
Repayment of term loan | ( | ( | |||||||||
Repayment of private placement of long-term note | ( | ||||||||||
Proceeds from senior notes | |||||||||||
Proceeds from senior credit facility | |||||||||||
Repayment of senior credit facility | ( | ( | |||||||||
Proceeds from (repayments of) bank overdrafts, net | ( | ||||||||||
Payments of capital lease obligations | ( | ( | |||||||||
Payments of debt issuance costs | ( | ( | |||||||||
Proceeds from issuance of common stock, net of (payments of) taxes from withheld shares | ( | ||||||||||
Payments on early extinguishment of debt | ( | ||||||||||
Payments to noncontrolling interest | ( | ||||||||||
Net cash from financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash and cash equivalents | ( | ( | |||||||||
Net change in cash and cash equivalents | ( | ||||||||||
Cash and cash equivalents at beginning of period | |||||||||||
Cash and cash equivalents at end of period | $ | $ | |||||||||
SUPPLEMENTAL CASH FLOW INFORMATION: | |||||||||||
Net issuances of obligations for acquisitions | $ | $ | |||||||||
Capital expenditures in accounts payable | $ | $ | |||||||||
Interest paid during the period, net of capitalized interest | $ | $ | |||||||||
Income taxes (refunded) paid, net during the period | $ | ( | $ |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 8 |
In millions | |||||||||||||||||||||||||||||||||||||||||
Stericycle, Inc. Equity | |||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2020 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
Net loss | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Cumulative currency translation loss realized through disposition of Argentina operations | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Issuance of common stock for exercise of options, RSU vesting, and employee stock purchases, net | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Balance as of September 30, 2020 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
In millions | |||||||||||||||||||||||||||||||||||||||||
Stericycle, Inc. Equity | |||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2019 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Change in qualifying cash flow hedge, net of tax | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Accelerated amortization of cash flow hedge, net of tax | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Issuance of common stock for exercise of options, RSU vesting, and employee stock purchases, net | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Payment to noncontrolling interest | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Balance as of September 30, 2019 | $ | $ | $ | $ | ( | $ | $ |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 9 |
In millions | |||||||||||||||||||||||||||||||||||||||||
Stericycle, Inc. Equity | |||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2019 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Cumulative currency translation loss realized through disposition of Argentina operations | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Issuance of common stock for exercise of options, RSU vesting, and employee stock purchases, net | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Cumulative effect of adopting ASU 2016-13 | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Balance as of September 30, 2020 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
In millions | |||||||||||||||||||||||||||||||||||||||||
Stericycle, Inc. Equity | |||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
Balance as of Balance as of December 31, 2018 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||
Change in qualifying cash flow hedge, net of tax | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Accelerated amortization of cash flow hedge, net of tax | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Issuance of common stock for exercise of options, RSU vesting, and employee stock purchases, net | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Payment to noncontrolling interest | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||
Balance as of September 30, 2019 | $ | $ | $ | $ | ( | $ | $ |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 10 |
STERICYCLE, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (In millions, except per share data and unless otherwise indicated) |
NOTE 1 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 11 |
NOTE 2 – REVENUES FROM CONTRACTS WITH CUSTOMERS |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 12 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Revenue by Service | |||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | $ | $ | $ | |||||||||||||||||||
Secure Information Destruction Services | |||||||||||||||||||||||
Communication and Related Services | |||||||||||||||||||||||
Total Revenues | $ | $ | $ | $ | |||||||||||||||||||
North America | |||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | $ | $ | $ | |||||||||||||||||||
Secure Information Destruction Services | |||||||||||||||||||||||
Communication and Related Services | |||||||||||||||||||||||
Total North America Segment | $ | $ | $ | $ | |||||||||||||||||||
International | |||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | $ | $ | $ | |||||||||||||||||||
Secure Information Destruction Services | |||||||||||||||||||||||
Communication and Related Services | |||||||||||||||||||||||
Total International Segment | $ | $ | $ | $ |
In millions | |||||||||||
September 30, 2020 | December 31, 2019 | ||||||||||
Other current assets | $ | $ | |||||||||
Other assets | |||||||||||
Total contract acquisition costs | $ | $ |
NOTE 3 – RESTRUCTURING, DIVESTITURES, AND IMPAIRMENTS |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 13 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 14 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Impairments | |||||||||||||||||||||||
Operational Optimization - COR | $ | $ | $ | $ | |||||||||||||||||||
Operational Optimization - SG&A | |||||||||||||||||||||||
Asset Impairment - COR | |||||||||||||||||||||||
Asset Impairment - SG&A | |||||||||||||||||||||||
Total Impairments | $ | $ | $ | $ | |||||||||||||||||||
North America | |||||||||||||||||||||||
Operational Optimization - COR | $ | $ | $ | $ | |||||||||||||||||||
Operational Optimization - SG&A | |||||||||||||||||||||||
Asset Impairment - COR | |||||||||||||||||||||||
Asset Impairment - SG&A | |||||||||||||||||||||||
Total North America Segment | $ | $ | $ | $ | |||||||||||||||||||
International | |||||||||||||||||||||||
Operational Optimization - COR | $ | $ | $ | $ | |||||||||||||||||||
Operational Optimization - SG&A | |||||||||||||||||||||||
Asset Impairment - COR | |||||||||||||||||||||||
Asset Impairment - SG&A | |||||||||||||||||||||||
Total International Segment | $ | $ | $ | $ |
NOTE 4 – GOODWILL AND OTHER INTANGIBLE ASSETS |
In millions | |||||||||||||||||
North America | International | Total | |||||||||||||||
Balance as of December 31, 2019 | $ | $ | $ | ||||||||||||||
Divestitures (Note 3) | ( | ( | |||||||||||||||
Changes due to foreign currency fluctuations | |||||||||||||||||
Balance as of September 30, 2020 | $ | $ | $ |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 15 |
In millions | |||||||||||||||||||||||||||||||||||
September 30, 2020 | December 31, 2019 | ||||||||||||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Value | Gross Carrying Amount | Accumulated Amortization | Net Value | ||||||||||||||||||||||||||||||
Amortizable intangibles: | |||||||||||||||||||||||||||||||||||
Customer relationships | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Covenants not-to-compete | |||||||||||||||||||||||||||||||||||
Tradenames | |||||||||||||||||||||||||||||||||||
Operating permits | |||||||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||
Indefinite lived intangibles: | |||||||||||||||||||||||||||||||||||
Operating permits | — | — | |||||||||||||||||||||||||||||||||
Tradenames | — | — | |||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
In millions | |||||
Total | |||||
Balance as of December 31, 2019 | $ | ||||
Impairments during the period (Note 3) | ( | ||||
Divestitures (Note 3) | ( | ||||
Amortization during the period | ( | ||||
Changes due to foreign currency fluctuations | ( | ||||
Balance as of September 30, 2020 | $ |
In millions | |||||
2020 (remainder) | $ | ||||
2021 | |||||
2022 | |||||
2023 | |||||
2024 |
NOTE 5 – LONG-TERM DEBT |
In millions | |||||||||||
September 30, 2020 | December 31, 2019 | ||||||||||
$ | $ | $ | |||||||||
$ | |||||||||||
$ | |||||||||||
Promissory notes and deferred consideration weighted average maturity | |||||||||||
Foreign bank debt weighted average maturity | |||||||||||
Obligations under finance leases | |||||||||||
Total debt | |||||||||||
Less: current portion of total debt | |||||||||||
Less: unamortized debt issuance costs | |||||||||||
Long-term portion of total debt | $ | $ |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 16 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 17 |
In millions | |||||||||||
September 30, 2020 | December 31, 2019 | ||||||||||
Outstanding letters of credit under Senior Credit Facility | $ | $ | |||||||||
Unused portion of the Senior Credit Facility |
NOTE 6 – INCOME TAXES |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 18 |
NOTE 7 – (LOSS) EARNINGS PER COMMON SHARE |
In millions, except per share data | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Numerator: | |||||||||||||||||||||||
Net loss attributable to Stericycle, Inc. common shareholders | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Numerator for basic loss per share attributable to Stericycle, Inc. common shareholders | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Denominator: | |||||||||||||||||||||||
Denominator for basic loss per share - weighted average shares | |||||||||||||||||||||||
Effect of dilutive securities: | |||||||||||||||||||||||
Denominator for diluted (loss) earnings per share - adjusted weighted average shares after assumed exercises | |||||||||||||||||||||||
Loss per share – Basic | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Loss per share – Diluted | $ | ( | $ | ( | $ | ( | $ | ( |
In thousands | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Options excluded from computation of diluted loss per share. | |||||||||||||||||||||||
RSUs excluded from computation of diluted loss per share. |
NOTE 8 – SEGMENT REPORTING |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 19 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Revenues | |||||||||||||||||||||||
North America | $ | $ | $ | $ | |||||||||||||||||||
International | |||||||||||||||||||||||
Total | $ | $ | $ | $ | |||||||||||||||||||
Adjusted Income from Operations | |||||||||||||||||||||||
North America | $ | $ | $ | $ | |||||||||||||||||||
International | |||||||||||||||||||||||
Other | ( | ( | ( | ( | |||||||||||||||||||
Total | $ | $ | $ | $ |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Total Reportable Segment Adjusted Income from Operations | $ | $ | $ | $ | |||||||||||||||||||
Business Transformation | ( | ( | ( | ( | |||||||||||||||||||
Intangible Amortization | ( | ( | ( | ( | |||||||||||||||||||
Acquisition and Integration | ( | ( | |||||||||||||||||||||
Operational Optimization | ( | ( | ( | ( | |||||||||||||||||||
Divestitures (including Divestiture (losses) gains, net) | ( | ( | ( | ( | |||||||||||||||||||
Litigation, Settlements and Regulatory Compliance | ( | ( | ( | ( | |||||||||||||||||||
Goodwill Impairment | ( | ||||||||||||||||||||||
Asset Impairments | ( | ( | ( | ||||||||||||||||||||
Other | ( | ( | ( | ( | |||||||||||||||||||
Loss from operations | $ | ( | $ | ( | $ | ( | $ | ( |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 20 |
NOTE 9 – COMMITMENTS AND CONTINGENCIES |
In millions | |||||||||||
September 30, 2020 | December 31, 2019 | ||||||||||
Accrued liabilities | $ | $ | |||||||||
Other long-term liabilities | |||||||||||
Total environmental liabilities | $ | $ |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 21 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 22 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 23 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 24 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 25 |
Revenue Service Category | Services Offered | COVID-19 Pandemic Impact | ||||||
Regulated Waste and Compliance Services | •Medical waste management services (including reusable sharps disposal management services) •Pharmaceutical waste services •Compliance programs under the Steri-Safe®, and First Practice Management brand names •Healthcare hazardous waste management services for hospitals and industrial hazardous waste in global markets | RWCS’s transportation and treatment facilities have remained open to provide safe and compliant disposal of medical waste. Revenues for RWCS showed growth over third quarter last year despite the impact on maritime waste services from the pandemic. The COVID-19 pandemic has also created new needs for healthcare testing centers for the COVID-19 virus across America as well as the disposal of non-healthcare waste. We continue to provide services to testing centers and our expanding non-healthcare waste customer base. | ||||||
Secure Information Destruction Services | •Secure information destruction (including document and hard drive destruction services) | Continuing with the progress built towards the end of the second quarter, in the third quarter continued recovery of our stops serviced as the economy continued to reopen. In North America, SID organic revenues were down 14.3% percent compared to third quarter 2019, which reflects a decrease in service stops of approximately the same percentage. While still below pre-pandemic levels, SID revenues recorded an improved quarter-over-quarter sequential performance. | ||||||
Communication and Related Services | •Appointment reminders, secure messaging, event registration, and other communications specifically for hospitals and integrated delivery networks. •Regulated recall and returns management communication, logistics, and data management services for expired, withdrawn or recalled products | At the end of the first quarter and through the third quarter 2020, we observed lower demand for services due to the pandemic. When excluding the impact of divestitures and foreign exchange, revenues declined $1.7 million. |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 26 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 27 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Pre-tax items: | |||||||||||||||||||||||
Included in COR | |||||||||||||||||||||||
Business Transformation | $ | — | $ | 0.1 | $ | — | $ | 0.1 | |||||||||||||||
Operational Optimization | — | 3.8 | — | 8.0 | |||||||||||||||||||
Asset Impairments | — | — | 6.8 | 1.6 | |||||||||||||||||||
Total included in COR | — | 3.9 | 6.8 | 9.7 | |||||||||||||||||||
Included in SG&A | |||||||||||||||||||||||
Business Transformation | 10.7 | 17.0 | 37.9 | 51.5 | |||||||||||||||||||
Intangible Amortization | 31.4 | 35.8 | 94.5 | 110.5 | |||||||||||||||||||
Acquisition and Integration | — | 1.6 | — | 3.5 | |||||||||||||||||||
Operational Optimization | 3.1 | 0.1 | 3.1 | 3.1 | |||||||||||||||||||
Divestitures | 1.3 | 2.1 | 6.7 | 9.3 | |||||||||||||||||||
Litigation, Settlements and Regulatory Compliance | 3.5 | 2.4 | 12.1 | 21.3 | |||||||||||||||||||
Asset Impairments | 0.6 | — | 6.1 | 2.1 | |||||||||||||||||||
Other | 2.1 | 7.2 | 8.0 | 32.8 | |||||||||||||||||||
Total included in SG&A | 52.7 | 66.2 | 168.4 | 234.1 | |||||||||||||||||||
Divestiture losses (gains), net | 104.1 | 83.2 | 166.2 | 78.1 | |||||||||||||||||||
Goodwill impairment | — | — | — | 20.9 | |||||||||||||||||||
Total included in Loss from operations | 156.8 | 153.3 | 341.4 | 342.8 | |||||||||||||||||||
Included in Interest expense, net | |||||||||||||||||||||||
Capital Allocation (debt related) | — | — | — | 3.6 | |||||||||||||||||||
Loss on early extinguishment of debt | — | — | — | 23.1 | |||||||||||||||||||
Included in Other expense, net | |||||||||||||||||||||||
Other (including highly inflationary exchange loss) | 0.2 | 1.8 | 1.2 | 3.1 | |||||||||||||||||||
Total pre-tax | $ | 157.0 | $ | 155.1 | $ | 342.6 | $ | 372.6 | |||||||||||||||
After tax items: | |||||||||||||||||||||||
U.S. CARES Act | $ | — | $ | — | $ | 39.4 | $ | — | |||||||||||||||
Total after-tax | $ | — | $ | — | $ | 39.4 | $ | — |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 28 |
In millions | |||||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | Cumulative Since Inception | |||||||||||||||||||||||||
ERP development and implementation (Project Monarch) | |||||||||||||||||||||||||||||
Consulting and professional fees | $ | 3.1 | $ | 7.1 | $ | 15.3 | $ | 19.8 | $ | 58.5 | |||||||||||||||||||
Internal labor | 3.4 | 2.9 | 10.4 | 7.1 | 28.5 | ||||||||||||||||||||||||
Software usage/maintenance fees | 3.1 | 4.4 | 8.8 | 12.1 | 31.5 | ||||||||||||||||||||||||
Other related expenses | 1.1 | 1.3 | 3.4 | 2.5 | 9.3 | ||||||||||||||||||||||||
Operating expenditures | 10.7 | 15.7 | 37.9 | 41.5 | 127.8 | ||||||||||||||||||||||||
Capital expenditures | 2.9 | 30.0 | 47.0 | 95.8 | 156.5 | ||||||||||||||||||||||||
Total ERP (Project Monarch) related | 13.6 | 45.7 | 84.9 | 137.3 | 284.3 | ||||||||||||||||||||||||
Investment in cost savings and other related matters | — | 1.4 | — | 10.1 | 91.7 | ||||||||||||||||||||||||
Total operating and capital expenditures | $ | 13.6 | $ | 47.1 | $ | 84.9 | $ | 147.4 | $ | 376.0 | |||||||||||||||||||
` | ` | ||||||||||||||||||||||||||||
Non-cash charges | $ | 0.6 | $ | 0.2 | $ | 1.7 | $ | 1.0 | $ | 15.3 | |||||||||||||||||||
Cash charges (including stock based compensation) | 10.1 | 16.9 | 36.2 | 50.6 | 204.2 | ||||||||||||||||||||||||
Total operating expenditures | $ | 10.7 | $ | 17.1 | $ | 37.9 | $ | 51.6 | $ | 219.5 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 29 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Operational Optimization | |||||||||||||||||||||||
Exit costs - employee termination | $ | 0.3 | $ | 0.3 | $ | 0.3 | $ | 0.5 | |||||||||||||||
Closure and exit costs - other | — | 0.7 | — | 2.5 | |||||||||||||||||||
Non-cash charges | 2.8 | 1.8 | 2.8 | 6.1 | |||||||||||||||||||
Other expenses | — | 1.1 | — | 2.0 | |||||||||||||||||||
Total Operational Optimization | $ | 3.1 | $ | 3.9 | $ | 3.1 | $ | 11.1 | |||||||||||||||
North America | |||||||||||||||||||||||
Exit costs - employee termination | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
Closure and exit costs - other | — | — | — | — | |||||||||||||||||||
Non-cash charges | — | — | — | 2.0 | |||||||||||||||||||
Other expenses | — | — | — | 0.1 | |||||||||||||||||||
Total | $ | — | $ | — | $ | — | $ | 2.1 | |||||||||||||||
International | |||||||||||||||||||||||
Exit costs - employee termination | $ | 0.3 | $ | 0.3 | $ | 0.3 | $ | 0.5 | |||||||||||||||
Closure and exit costs - other | — | 0.7 | — | 2.5 | |||||||||||||||||||
Non-cash charges | 2.8 | 1.8 | 2.8 | 4.1 | |||||||||||||||||||
Other expenses | — | 1.1 | — | 1.9 | |||||||||||||||||||
Total | $ | 3.1 | $ | 3.9 | $ | 3.1 | $ | 9.0 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 30 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Argentina operations | $ | 112.4 | $ | — | $ | 112.4 | $ | — | |||||||||||||||
Domestic Environmental Solutions business | (8.3) | — | 53.8 | — | |||||||||||||||||||
CRS operations | — | 42.3 | — | 42.3 | |||||||||||||||||||
Mexico operations | — | 40.2 | — | 40.2 | |||||||||||||||||||
U.K. businesses | — | 0.7 | — | (4.4) | |||||||||||||||||||
Divestiture losses (gains), net | 104.1 | 83.2 | 166.2 | 78.1 | |||||||||||||||||||
Consulting, professional, and other fees (in SG&A) | 1.3 | 2.1 | 6.7 | 9.3 | |||||||||||||||||||
Total Divestitures (including Divestiture losses (gains), net) | $ | 105.4 | $ | 85.3 | $ | 172.9 | $ | 87.4 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 31 |
In millions | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||
Property, plant and equipment | $ | — | $ | — | $ | 6.8 | $ | 1.6 | |||||||||||||||
Impairments included in COR | $ | — | $ | — | $ | 6.8 | $ | 1.6 | |||||||||||||||
Property, plant and equipment | $ | 0.2 | $ | — | $ | 0.2 | $ | 0.4 | |||||||||||||||
Customer lists, permits and tradenames | 0.4 | — | 5.9 | 1.7 | |||||||||||||||||||
Impairments included in SG&A | $ | 0.6 | $ | — | $ | 6.1 | $ | 2.1 | |||||||||||||||
Goodwill impairments: | |||||||||||||||||||||||
Latin America reporting unit | $ | — | $ | — | $ | — | $ | 20.9 | |||||||||||||||
Goodwill impairments | $ | — | $ | — | $ | — | $ | 20.9 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 32 |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
In millions | Components of Change (%) | ||||||||||||||||||||||||||||||||||||||||||||||
Organic | |||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | Change ($) | Change (%) | Growth(1) | SOP Pricing | Divestitures | Foreign Exchange | ||||||||||||||||||||||||||||||||||||||||
Revenue by Service | |||||||||||||||||||||||||||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | 415.5 | $ | 551.6 | $ | (136.1) | (24.7) | % | 0.6 | % | — | % | (25.1) | % | (0.2) | % | |||||||||||||||||||||||||||||||
Secure Information Destruction Services | 187.3 | 222.6 | (35.3) | (15.9) | % | (16.8) | % | 0.6 | % | — | % | 0.4 | % | ||||||||||||||||||||||||||||||||||
Communication and Related Services | 33.6 | 58.9 | (25.3) | (43.0) | % | (2.9) | % | — | % | (40.2) | % | 0.1 | % | ||||||||||||||||||||||||||||||||||
Total Revenues | $ | 636.4 | $ | 833.1 | $ | (196.7) | (23.6) | % | (4.3) | % | 0.1 | % | (19.4) | % | — | % | |||||||||||||||||||||||||||||||
North America | |||||||||||||||||||||||||||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | 322.5 | $ | 445.6 | $ | (123.1) | (27.6) | % | (0.8) | % | — | % | (26.8) | % | — | % | |||||||||||||||||||||||||||||||
Secure Information Destruction Services | 163.4 | 189.7 | (26.3) | (13.9) | % | (14.3) | % | 0.6 | % | — | % | (0.1) | % | ||||||||||||||||||||||||||||||||||
Communication and Related Services | 31.2 | 56.6 | (25.4) | (44.9) | % | (3.0) | % | — | % | (41.8) | % | — | % | ||||||||||||||||||||||||||||||||||
Total North America Segment | $ | 517.1 | $ | 691.9 | $ | (174.8) | (25.3) | % | (4.7) | % | 0.2 | % | (20.7) | % | — | % | |||||||||||||||||||||||||||||||
International | |||||||||||||||||||||||||||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | 93.0 | $ | 106.0 | $ | (13.0) | (12.3) | % | 6.4 | % | — | % | (17.7) | % | (1.0) | % | |||||||||||||||||||||||||||||||
Secure Information Destruction Services | 23.9 | 32.9 | (9.0) | (27.4) | % | (31.2) | % | 0.5 | % | — | % | 3.3 | % | ||||||||||||||||||||||||||||||||||
Communication and Related Services | 2.4 | 2.3 | 0.1 | 4.3 | % | — | % | — | % | — | % | 4.3 | % | ||||||||||||||||||||||||||||||||||
Total International Segment | $ | 119.3 | $ | 141.2 | $ | (21.9) | (15.5) | % | (2.5) | % | 0.1 | % | (13.3) | % | 0.1 | % |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 33 |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
In millions | Components of Change (%) | ||||||||||||||||||||||||||||||||||||||||||||||
Organic | |||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | Change ($) | Change (%) | Growth(1) | SOP Pricing | Divestitures | Foreign Exchange | ||||||||||||||||||||||||||||||||||||||||
Revenue by Service | |||||||||||||||||||||||||||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | 1,366.9 | $ | 1,641.7 | $ | (274.8) | (16.7) | % | 1.2 | % | — | % | (16.7) | % | (1.2) | % | |||||||||||||||||||||||||||||||
Secure Information Destruction Services | 557.9 | 684.0 | (126.1) | (18.4) | % | (16.3) | % | (2.0) | % | — | % | (0.1) | % | ||||||||||||||||||||||||||||||||||
Communication and Related Services | 94.8 | 183.3 | (88.5) | (48.3) | % | (7.0) | % | — | % | (41.2) | % | (0.1) | % | ||||||||||||||||||||||||||||||||||
Total Revenues | $ | 2,019.6 | $ | 2,509.0 | $ | (489.4) | (19.5) | % | (4.2) | % | (0.6) | % | (13.9) | % | (0.8) | % | |||||||||||||||||||||||||||||||
North America | |||||||||||||||||||||||||||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | 1,089.6 | $ | 1,317.8 | $ | (228.2) | (17.3) | % | 0.5 | % | — | % | (17.7) | % | (0.1) | % | |||||||||||||||||||||||||||||||
Secure Information Destruction Services | 486.8 | 584.4 | (97.6) | (16.7) | % | (14.6) | % | (2.0) | % | — | % | (0.1) | % | ||||||||||||||||||||||||||||||||||
Communication and Related Services | 86.6 | 174.0 | (87.4) | (50.2) | % | (8.3) | % | — | % | (41.9) | % | (0.1) | % | ||||||||||||||||||||||||||||||||||
Total North America Segment | $ | 1,663.0 | $ | 2,076.2 | $ | (413.2) | (19.9) | % | (4.5) | % | (0.6) | % | (14.8) | % | (0.1) | % | |||||||||||||||||||||||||||||||
International | |||||||||||||||||||||||||||||||||||||||||||||||
Regulated Waste and Compliance Services | $ | 277.3 | $ | 323.9 | $ | (46.6) | (14.4) | % | 4.0 | % | — | % | (12.6) | % | (5.8) | % | |||||||||||||||||||||||||||||||
Secure Information Destruction Services | 71.1 | 99.6 | (28.5) | (28.6) | % | (26.0) | % | (2.3) | % | — | % | (0.2) | % | ||||||||||||||||||||||||||||||||||
Communication and Related Services | 8.2 | 9.3 | (1.1) | (11.8) | % | 17.2 | % | — | % | (29.0) | % | — | % | ||||||||||||||||||||||||||||||||||
Total International Segment | $ | 356.6 | $ | 432.8 | $ | (76.2) | (17.6) | % | (2.6) | % | (0.5) | % | (10.0) | % | (4.4) | % |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 34 |
In millions | |||||||||||||||||||||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Gross profit | 267.3 | 42.0 | % | 295.3 | 35.4 | % | (28.0) | (9.5) | % |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Gross profit | 783.6 | 38.8 | % | 895.0 | 35.7 | % | (111.4) | (12.4) | % |
In millions | |||||||||||||||||||||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
SG&A | 219.0 | 34.4 | % | 246.6 | 29.6 | % | (27.6) | (11.2) | % |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
SG&A | 678.7 | 33.6 | % | 809.4 | 32.3 | % | (130.7) | (16.1) | % |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 35 |
In millions | |||||||||||||||||||||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Divestiture losses (gains), net | 104.1 | 16.4 | % | 83.2 | 10.0 | % | 20.9 | 25.1 | % |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Divestiture losses (gains), net | 166.2 | 8.2 | % | 78.1 | 3.1 | % | 88.1 | 112.8 | % |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Goodwill impairment | — | — | 20.9 | 0.8 | % | (20.9) | (100.0) | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | Change 2020 versus 2019 | 2020 | 2019 | Change 2020 versus 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | % of Segment Revenue | $ | % of Segment Revenue | $ | % | $ | % of Segment Revenue | $ | % of Segment Revenue | $ | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted Income from Operations | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
North America | 157.0 | 30.4 | % | 155.5 | 22.5 | % | 1.5 | 1.0 | % | 447.0 | 26.9 | % | 444.7 | 21.4 | % | 2.3 | 0.5 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
International | 15.4 | 12.9 | % | 20.0 | 14.2 | % | (4.6) | (23.0) | % | 32.3 | 9.1 | % | 53.1 | 12.3 | % | (20.8) | (39.2) | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
All Other | (71.4) | (11.2) | % | (56.7) | — | % | (14.7) | 25.9 | % | (199.2) | — | % | (168.4) | — | % | (30.8) | 18.3 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | 101.0 | 15.9 | % | 118.8 | 14.3 | % | (17.8) | (15.0) | % | 280.1 | 13.9 | % | 329.4 | 13.1 | % | (49.3) | (15.0) | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation to Loss from operations: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted Income from Operations | 101.0 | 118.8 | 280.1 | 329.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusting Items Total | (156.8) | (153.3) | (341.4) | (342.8) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss from Operations | (55.8) | (34.5) | (61.3) | (13.4) |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 36 |
In millions | |||||||||||||||||||||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Interest expense, net | 17.7 | 2.8 | % | 29.9 | 3.6 | % | (12.2) | (40.8) | % |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Interest expense, net | 62.0 | 3.1 | % | 91.1 | 3.6 | % | (29.1) | (31.9) | % |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 37 |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Loss on early extinguishment of debt | — | — | % | 23.1 | 0.9 | % | (23.1) | (100.0) | % |
In millions | |||||||||||||||||||||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Other expense, net | 0.9 | 0.1 | % | 3.2 | 0.4 | % | (2.3) | (71.9 | %) |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | % Revenue | $ | % Revenue | $ | % | ||||||||||||||||||||||||||||||
Other expense, net | 4.8 | 0.2 | % | 7.2 | 0.3 | % | (2.4) | (33.3 | %) |
In millions | |||||||||||||||||||||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | Effective Rate | $ | Effective Rate | $ | % | ||||||||||||||||||||||||||||||
Income tax (expense) benefit | (6.5) | (8.7) | % | 8.6 | 12.7 | % | 15.1 | 175.6 | % |
In millions | |||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | |||||||||||||||||||||||||||||||||
$ | Effective rate | $ | Effective rate | $ | % | ||||||||||||||||||||||||||||||
Income tax (expense) benefit | 23.2 | 18.1 | % | 8.0 | 5.9 | % | 15.2 | 190.0 | % |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 38 |
In millions | |||||||||||
Nine Months Ended September 30, | |||||||||||
2020 | 2019 | ||||||||||
Net cash from operating activities | $ | 365.2 | $ | 201.2 | |||||||
Net cash from investing activities | 328.2 | (141.3) | |||||||||
Net cash from financing activities | (668.3) | (60.0) | |||||||||
Effect of exchange rate changes on cash and cash equivalents | (0.4) | (3.4) | |||||||||
Net change in cash and cash equivalents | $ | 24.7 | $ | (3.5) |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 39 |
Item 3. Quantitative and Qualitative Disclosures about Market Risk |
Item 4. Controls and Procedures |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 40 |
(a) | not fully implementing and monitoring general information technology controls (“GITCs”) in the areas of user access and program change management for systems supporting all of the Company’s internal control processes. Our business process controls (automated and manual) are dependent on the affected GITCs and therefore are also deemed ineffective because they could have been adversely impacted by the ineffective GITCs; and |
(b) | our Domestic Environmental Solutions business of the North America Regulated Waste and Compliance Services segment (further referred to within this Item as “Environmental Solutions”) related to not fully designing, implementing and monitoring controls relevant to our revenue (including the GITCs for systems supporting this process) and cost of disposal processes. |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 41 |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 42 |
PART II |
PART II – OTHER INFORMATION |
Item 1. Legal Proceedings |
Item 1A. Risk Factors |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 43 |
PART IV |
Item 6. Exhibits |
Exhibit Index | Description | |||||||
2.1 | ||||||||
3.1 | ||||||||
3.2 | ||||||||
3.3 | ||||||||
3.4 | ||||||||
3.5 | ||||||||
3.6 | ||||||||
3.7 | ||||||||
3.8 | ||||||||
3.9 | ||||||||
3.1 | ||||||||
10.1 | ||||||||
10.2 | ||||||||
31.1 | ||||||||
31.2 | ||||||||
32 | ||||||||
101 | The following information from our Quarterly Report on Form 10-Q for the quarter ended September 30, 2020, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Loss; (ii) Condensed Consolidated Statements of Comprehensive (Loss) Income; (iii) Condensed Consolidated Balance Sheets; (iv) Condensed Consolidated Statements of Cash Flows; (v) Condensed Consolidated Statements of Changes in Equity and (vi) Notes to Condensed Consolidated Financial Statements | |||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 44 |
SIGNATURES |
STERICYCLE, INC. | |||||
(Registrant) | |||||
By: /s/ JANET H. ZELENKA | |||||
Janet H. Zelenka | |||||
Executive Vice President, Chief Financial Officer & Chief Information Officer |
2020 Q3 10-Q Report | Stericycle, Inc. ● | 45 |
/s/ CINDY J. MILLER | ||||||||
Cindy J. Miller | ||||||||
Chief Executive Officer | ||||||||
Stericycle, Inc. |
/s/ JANET H. ZELENKA | ||||||||
Janet H. Zelenka | ||||||||
Executive Vice President, Chief Financial Officer & Chief Information Officer | ||||||||
Stericycle, Inc. |
/s/ CINDY J. MILLER | ||||||||
Cindy J. Miller | ||||||||
Chief Executive Officer | ||||||||
Stericycle, Inc. |
/s/ JANET H. ZELENKA | ||||||||
Janet H. Zelenka | ||||||||
Executive Vice President, Chief Financial Officer & Chief Information Officer | ||||||||
Stericycle, Inc. |
CONDENSED CONSOLIDATED STATEMENTS OF LOSS - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Income Statement [Abstract] | ||||
Revenue | $ 636.4 | $ 833.1 | $ 2,019.6 | $ 2,509.0 |
Cost of revenues | 369.1 | 537.8 | 1,236.0 | 1,614.0 |
Gross profit | 267.3 | 295.3 | 783.6 | 895.0 |
Selling, general and administrative expenses | 219.0 | 246.6 | 678.7 | 809.4 |
Divestiture losses (gains), net | 104.1 | 83.2 | 166.2 | 78.1 |
Goodwill impairment | 0.0 | 0.0 | 0.0 | 20.9 |
Loss from operations | (55.8) | (34.5) | (61.3) | (13.4) |
Interest expense, net | (17.7) | (29.9) | (62.0) | (91.1) |
Loss on early extinguishment of debt | 0.0 | 0.0 | 0.0 | (23.1) |
Other expense, net | (0.9) | (3.2) | (4.8) | (7.2) |
Loss before income taxes | (74.4) | (67.6) | (128.1) | (134.8) |
Income tax (expense) benefit | (6.5) | 8.6 | 23.2 | 8.0 |
Net loss | (80.9) | (59.0) | (104.9) | (126.8) |
Net income attributable to noncontrolling interests | (0.3) | (0.2) | (0.9) | (0.7) |
Net loss attributable to Stericycle, Inc. common shareholders | $ (81.2) | $ (59.2) | $ (105.8) | $ (127.5) |
Loss per common share attributable to Stericycle, Inc. common shareholders: | ||||
Basic (in dollars per share) | $ (0.89) | $ (0.65) | $ (1.16) | $ (1.40) |
Diluted (in dollars per share) | $ (0.89) | $ (0.65) | $ (1.16) | $ (1.40) |
Weighted average number of common shares outstanding: | ||||
Basic (in shares) | 91.5 | 91.1 | 91.4 | 91.0 |
Diluted (in shares) | 91.5 | 91.1 | 91.4 | 91.0 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended |
---|---|---|
Sep. 30, 2019 |
Sep. 30, 2019 |
|
Statement of Comprehensive Income [Abstract] | ||
Amortization of cash flow hedge into income, tax expense | $ 0.0 | $ 0.2 |
Change in fair value of cash flow hedge, tax expense | 0.1 | |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, Tax | $ 1.1 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 55.4 | $ 67.9 |
Property, plant and equipment, accumulated depreciation | 661.8 | 667.8 |
Intangible assets, accumulated amortization | $ 615.7 | $ 584.9 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 120,000,000.0 | 120,000,000.0 |
Common stock, issued (in shares) | 91,500,000 | 91,500,000 |
Common stock, outstanding (in shares) | 91,100,000 | 91,100,000 |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
9 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Sep. 30, 2020 | |||||||
Accounting Policies [Abstract] | |||||||
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Summary of Significant Accounting Policies Basis of Presentation: The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of Stericycle, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company's Condensed Consolidated Financial Statements were prepared in accordance with U.S. GAAP and include the assets, liabilities, revenues and expenses of all wholly owned subsidiaries and majority-owned subsidiaries over which the Company exercises control. Outside shareholders' interests in subsidiaries are shown on the Condensed Consolidated Financial Statements as “Noncontrolling interests." The accompanying unaudited Condensed Consolidated Financial Statements as of September 30, 2020 and for the three and nine months ended September 30, 2020 and 2019 have been prepared pursuant to the rules and regulations of the SEC for interim reporting and, therefore, do not include all information and footnote disclosures normally included in audited financial statements prepared in conformity with U.S. GAAP. In the opinion of management, however, all adjustments, consisting of normal recurring adjustments necessary to present fairly the results of operations, financial position and cash flows have been made. These Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto included in the 2019 Form 10-K. The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the full year or any other period. Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Some areas where the Company makes estimates include its allowance for doubtful accounts, credit memo reserve, accrued employee health and welfare benefits, environmental liabilities, stock-based compensation expense, income tax liabilities, accrued auto and workers’ compensation insurance claims, operating lease ROU assets and lease liabilities, intangible asset valuations, and long-lived asset and goodwill impairment assessments. Actual results could differ from the Company's estimates. Allowance for Doubtful Accounts: The Company reports accounts receivable at their net realizable value, which is management’s best estimate of the cash that will ultimately be received. The Company maintains an allowance for doubtful accounts to reflect the expected uncollectability of accounts receivable based on historical collection data and specific risks identified among uncollected accounts, as well as management’s expectation of future economic conditions. If current or expected future economic trends, events, or changes in circumstances indicate that specific receivable balances may be impaired, further consideration is given to the collectability of those balances and the allowance is adjusted accordingly. The adequacy of allowances for uncollectible accounts is reviewed at least quarterly and adjusted as necessary based on such reviews. Management’s judgment is required to assess the collectability of an account, based on detailed analysis of the aging of the receivables, the creditworthiness of the Company’s customers, historical collection trends, and current and future expected economic trends. Accounts receivable written off in subsequent periods can differ from the allowance for doubtful accounts provided, but historically the Company’s provision has been adequate. The allowance for doubtful accounts has decreased to $55.4 million as of September 30, 2020 from $67.9 million as of December 31, 2019. This decline is principally due to write offs of uncollectible receivables in Brazil and due to the divestiture of the Domestic Environmental Solutions business on April 6, 2020. See Part I, Item I. Financial Statements Note 3 Restructuring, Divestitures and Impairments for further information. Adoption of New Accounting Standards Financial Instrument Credit Losses In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”) associated with the measurement of credit losses on financial instruments. ASU 2016-13 replaces the prior incurred loss impairment methodology of recognizing credit losses when a loss was probable, with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to assess credit loss estimates. The amended guidance was effective for the Company on January 1, 2020. The Company recognized a net decrease to Retained earnings in the Condensed Consolidated Financial Statements of $2.5 million as of January 1, 2020 for the cumulative effect of adopting ASU 2016-13. Implementation Costs Incurred in a Cloud Computing Arrangement In August 2018, the FASB issued ASU 2018-15, “Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” (“ASU 2018-15”). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs for internal-use software. The accounting for any hosting contract is unchanged. ASU 2018-15 was effective on January 1, 2020 and was adopted prospectively for implementation costs incurred after the date of adoption. The adoption of ASU 2018-15 did not have a material impact on the Condensed Consolidated Financial Statements. Accounting Standards Issued But Not Yet Adopted Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 attempts to simplify aspects of accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods within that fiscal year. Early adoption is permitted for all entities. The Company plans to adopt ASU 2019-12 effective January 1, 2021.
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REVENUES FROM CONTRACTS WITH CUSTOMERS |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REVENUES FROM CONTRACTS WITH CUSTOMERS |
Disaggregation of Revenues During the three month period ended June 30, 2020, we updated our service lines to include Hazardous Waste Solutions Services and Manufacturing and Industrial Services in RWCS. This reclassification was driven by the divestiture of the Domestic Environmental Solutions business. See Part I, Item I. Financial Statements Note 3 Restructuring, Divestitures and Impairments. In addition, during the three month period ended June 30, 2020, we updated segment reporting to reflect U.S. CRS as part of the North America segment. See Part I, Item I. Financial Statements; Note 8 Segment Reporting in the Condensed Consolidated Financial Statements for further information. For 2019 periods, amounts have been recast to reflect these changes. The following table presents revenues disaggregated by service and reportable segments:
Contract Liabilities Contract liabilities at September 30, 2020 and December 31, 2019 were $9.5 million and $12.2 million, respectively. Contract liabilities as of September 30, 2020 are expected to be recognized in Revenues, as the amounts are earned, which will be over the next 12 months. Contract Acquisition Costs The Company’s incremental direct costs of obtaining a contract, which consist primarily of sales incentives, are deferred and amortized to SG&A over a weighted average estimated period of benefit of 6.4 years. During the three months ended September 30, 2020 and 2019, the Company amortized $2.7 million and $2.2 million, respectively, of deferred sales incentives to SG&A. During the nine months ended September 30, 2020 and 2019, the Company amortized $7.8 million and $6.5 million, respectively, of deferred sales incentives to SG&A. Total contract acquisition costs, net of accumulated amortization, were classified as follows:
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RESTRUCTURING, DIVESTITURES AND IMPAIRMENTS |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RESTRUCTURING, DIVESTITURES, AND IMPAIRMENTS |
Restructuring - Business Transformation Stericycle is focused on driving long-term growth, profitability and delivering enhanced shareholder value. During the nine months ended September 30, 2019, the Company recognized $5.3 million in charges related to executive and employee termination costs, primarily within Other as part of SG&A in the Condensed Consolidated Statements of Loss. As of September 30, 2020, approximately $1.2 million in future payments remained accrued as part of Accrued Liabilities on the Condensed Consolidated Balance Sheets. Divestitures On August 3, 2020, Stericycle entered into an agreement and completed the sale of its operations in Argentina for proceeds of approximately $3.9 million. Revenue of Argentina operations were approximately 1% of our consolidated annual revenues for 2019. The transaction resulted in a third quarter divestiture pre-tax loss of $112.4 million, of which $87.2 million related to the balance of cumulative currency translation adjustment. On April 6, 2020, the Company completed the sale of all of the outstanding equity interests of its Domestic Environmental Solutions business (the “Transaction”) to Buyer for approximately $462.5 million (subject to customary adjustments for working capital and other adjustments), pursuant to the Purchase Agreement, dated February 6, 2020. As previously announced, the Purchase Agreement provided for the divestiture of the Company’s Domestic Environmental Solutions business, reported in the North America segment, exclusive of the Company’s healthcare hazardous waste services and unused consumer pharmaceutical take-back services, to Buyer. In connection with the Purchase Agreement, the Company entered into an HSA and TSA with the Buyer for a period of 7 years and 6 months, respectively. The Company allocated and deferred a portion of the Transaction proceeds, $17.7 million related to the HSA and $1.5 million related to the TSA, which will be recognized over the applicable duration of the HSA and TSA periods, subject to specific agreement provisions, thereby offsetting the expenses incurred to deliver the respective services. The allocated proceeds are reflected as an operating cash flow on the Condensed Consolidated Statement of Cash Flows, as they are advances received for services to be provided prospectively. In the first quarter of 2020, the Company recognized an impairment charge of $58.3 million, inclusive of $10.8 million of related deal costs for the Transaction. In the second and third quarters of 2020, the Company recognized an incremental pre-tax loss (gain) of $3.8 million and $(8.3) million, respectively, primarily driven by working capital adjustments based upon the terms of the Purchase Agreement that have now concluded with an associated payment of $9.7 million to the Buyer in September 2020. These charges, net are reported as Divestiture losses (gains), net in the Company’s Condensed Consolidated Statements of Loss. Further, the Company released a $1.7 million benefit associated with contingent consideration related to a prior acquisition agreement connected with the divested business (Fair value - Level 3) that is reported in SG&A in the Company’s Condensed Consolidated Statements of Loss. During the nine months ended September 30, 2019, the Company completed the sale of the its U.K. based texting business, a component of the International segment for proceeds of $14.9 million, including a $1.3 million note receivable that was due in six months from the closing of the transaction, resulting in a pre-tax gain of approximately $5.1 million, which is recognized in Divestiture losses (gains), net in the Condensed Consolidated Statements of Loss. During September 2019, the Company approved plans to sell its TAS business in North America and its retail pharmaceutical returns business in the U.S. and Puerto Rico. Accordingly, the assets and liabilities for these businesses were classified as held for sale resulting in a $42.3 million impairment charge in the three and nine months ended September 30, 2019. These businesses are part of CRS, which is presented in the North America reportable segment. In October 2019, the Company entered into definitive agreements and completed the sales of these businesses for cash consideration of $36.4 million. During September 2019, the Company also approved a plan to sell substantially all of its operations in Mexico. Accordingly, the assets and liabilities for these operations were classified as held for sale resulting in a $40.2 million impairment charge in the three and nine months ended September 30, 2019. In October 2019, the Company entered into a definitive agreement and completed the sale of the Mexico operations for nominal consideration. These operations are presented in the International RWCS reportable segment. The cumulative currency translation adjustment of $18.0 million was included as part of the carrying value of the disposal group when measuring the impairment charge. Impairments:
Operational optimization impairments are associated with our actions to reduce operating costs and optimize operations. In the three and nine months ended September 30, 2020 our International reportable segment includes charges primarily related to the discontinuation of a service line in the U.K. In the three and nine months ended September 30, 2019 our International reportable segment includes charges related to impairments of permits and other long-lived assets in Europe and Latin America and our North America reportable segment for charges associated with a site movement. Asset impairments in the three and nine months ended September 30, 2020 our North America reportable segment includes charges associated with rationalization of software application assets and intangible assets as a result of a discontinuation of a certain service line, and our International reportable segment includes charges associated with certain property, plant and equipment assets and permits primarily in the U.K.
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GOODWILL AND OTHER INTANGIBLE ASSETS |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS |
Goodwill: Changes in the carrying amount of goodwill by reportable segment were as follows:
During the first quarter of 2019, there were business, market, and strategic developments which negatively impacted the estimated cash flows of our Latin America reporting unit and triggered an interim assessment as of March 31, 2019. The Company determined that the Latin America reporting unit’s carrying value was in excess of its estimated fair value and recognized $20.9 million of non-cash goodwill impairment, resulting in no remaining goodwill in the Latin America reporting unit. Intangible Assets: Intangible assets were as follows:
Changes in the carrying amount of intangible assets were as follows:
The estimated amortization expense for each of the next five years (based upon exchange rates at September 30, 2020) is as follows for the years ending December 31:
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LONG-TERM DEBT |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LONG-TERM DEBT |
The Company’s long-term debt consisted of the following:
The estimated fair value of our debt approximated $2.03 billion and $2.73 billion as of September 30, 2020 and December 31, 2019, respectively. These fair value amounts were estimated using an income approach by applying market interest rates for comparable instruments and developed based on inputs classified as Level 2 within the fair value hierarchy. On February 25, 2020, the Company executed a Fifth Amendment, which amended the Credit Agreement to, among other things: •increase the maximum allowable Consolidated Leverage Ratio to 5.00 to 1.00 until December 31, 2021 and 4.50 to 1.00 thereafter. •upon the consummation of the divestiture of the Domestic Environmental Solutions business Disposal Group, each of the foregoing maximum permitted Consolidated Leverage Ratio levels were reduced to 4.75 to 1.00 until December 31, 2021 and 4.25 to 1.00 thereafter. •allow for continuation of the $200.0 million of cash add backs to EBITDA through December 31, 2020, and addbacks of $100.0 million until December 31, 2021, with no further addbacks thereafter. •increase the leverage ratio pricing tier of greater than 4.50 to 1.00 by 0.125%. •grant a first-priority security interest to the administrative agent for the benefit of the lenders in substantially all of the personal property of the Company and certain of its material domestic subsidiaries, including certain equity interests held by those entities. In the nine months ended September 30, 2020 and in connection with the Fifth Amendment, the Company incurred issuance costs of $1.7 million, of which $0.4 million has been charged to Interest expense, net. The remainder was capitalized as unamortized debt issuance costs and is being amortized to Interest expense, net over the remaining term of the Credit Agreement. The Company may make prepayments against the amended Senior Credit Facility, in whole or in part, without premium or penalty. The Company would be required to prepay certain outstanding amounts in the event of certain circumstances or transactions. In April 2020, with the net proceeds generated from the divestiture of the Domestic Environmental Solutions business, the Company made principal repayments of approximately $430.0 million, which excluded certain transaction costs, final working capital adjustments, or other adjustments associated with the divestiture. As of September 30, 2020, the Company was in compliance with its Consolidated Leverage Ratio covenant, with an actual ratio of 3.75 to 1.00, which was below the allowed maximum ratio of 4.75 to 1.00 as set forth in the Fifth Amendment. On April 6, 2020, the Company completed the divestiture of the Domestic Environmental Solutions business. Therefore, effective April 6, 2020, the Consolidated Leverage Ratio decreased by 0.25 to 4.75 to 1.00 for fiscal quarters ending on or before December 31, 2021 and 4.25 to 1.00 for fiscal quarters ending on or after March 31, 2022. Given our current leverage position, we believe that we should be able to operate within our covenant thresholds, but due to the unpredictability of the COVID-19 pandemic and situations outside our control, it is reasonably likely we could exceed this Consolidated Leverage Ratio threshold at some point in the next 12 months. This risk can be mitigated and potentially managed through appropriate spending controls, divestitures, restructuring the Company’s existing indebtedness, amending the Credit Agreement, or seeking temporary relief from the Consolidated Leverage Ratio covenant from the Company’s lenders. A failure to comply with these covenant provisions could result in an event of default. Upon an event of default, unless waived, the lenders could elect to terminate their commitments, cease making further loans, and/or cause their loans to become due and payable in full, foreclose against the assets securing the debt under our Credit Agreement and force us and our subsidiaries into bankruptcy or liquidation. In the second quarter 2019, the Company completed the following transactions: a)Issued $600.0 million at par of aggregate principal Senior Notes, due July 2024, In connection with the issuance of the Senior Notes the Company incurred $7.1 million of direct issuance costs, which have been capitalized in unamortized debt issuance costs and are being amortized to Interest expense, net over the term of the Senior Notes. b)Executed the Fourth Amendment which amended the Credit Agreement. In connection with the Fourth Amendment, the Company incurred issuance costs of $2.0 million, of which $0.2 million had been charged to Interest expense, net and the remainder capitalized as unamortized debt issuance costs and are being amortized to Interest expense, net over the remaining term of the Credit Agreement. c)Repaid in full $1.075 billion of the outstanding private placement notes using the net proceeds from the Senior Notes and the incremental Term Loan together with additional borrowings under the Senior Credit Facility. In connection with the repayment of the private placement notes, the Company incurred a loss on early extinguishment of debt of $23.1 million comprising make whole premiums, payable under the terms of certain of the private placement notes, of $20.4 million and the write-off of $2.7 million of unamortized debt issuance costs associated with the private placement notes. Amounts committed to outstanding letters of credit and the unused portion of the Company’s Senior Credit Facility were as follows:
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INCOME TAXES |
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Sep. 30, 2020 | |||||||
Income Tax Disclosure [Abstract] | |||||||
INCOME TAXES |
The Company reported income tax expense of $6.5 million for the three months ended September 30, 2020 compared to a benefit of $8.6 million for the three months ended September 30, 2019. The effective tax rates for the three months ended September 30, 2020 and 2019 was an expense of 8.7% and a benefit of 12.7%, respectively. The results for the three months ended September 30, 2020 reflect the impact associated with non-deductible divestiture charges. The effective tax rate for the three months ended September 30, 2019 is principally due to the impact of certain non-deductible impairments of assets held-for-sale and the impact of valuation allowances recognized against current losses in several countries offset by the impact of certain tax reserves adjustments. The Company reported an income tax benefit of $23.2 million for the nine months ended September 30, 2020 compared to a tax benefit of $8.0 million for the nine months ended September 30, 2019. The effective tax rates for the nine months ended September 30, 2020 and 2019, were 18.1% and 5.9%, respectively. The results for the nine months ended September 30, 2020, reflected a $39.4 million tax benefit related to the U.S. CARES Act (see further description below), the tax impact from divestiture charges which are primarily non-deductible, and discrete tax expense associated with stock-based compensation. The effective tax rate for the nine months ended September 30, 2019, is principally due to the impact of certain non-deductible impairments of assets held-for-sale and goodwill, valuation allowances recognized against current period losses in several countries, partially offset by the impact of certain tax reserves adjustments. On March 27, 2020, President Donald Trump signed into law the U.S. CARES Act, which is a substantial tax-and-spending package intended to provide additional economic stimulus to address the impact of the COVID-19 pandemic. The U.S. CARES Act provides numerous tax provisions and other stimulus measures, including temporary changes regarding the prior and future utilization of net operating losses, temporary changes to the prior and future limitations on interest deductions, temporary suspension of certain payment requirements for the employer portion of Social Security taxes, technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property, and the creation of certain refundable employee retention credits. As a result of the U.S. CARES Act tax law changes, in the nine months ended September 30, 2020, we recognized a $39.4 million tax benefit related to our ability to carryback net operating losses to prior years that had higher tax rates. In conjunction with previously recognized net operating losses, the total refunds we anticipate from the U.S. CARES Act in 2020 are approximately $100 million. In July 2020, the Company received approximately half of the expected refund amounts. The impact of the CARES Act in prospective periods may differ from our estimate as of September 30, 2020 due to changes in interpretations and assumptions, guidance that may be issued and actions the Company may take in response to the CARES Act. The CARES Act is highly detailed, and the Company will continue to assess the impact that various provisions will have on its business. Similar tax provisions and other stimulus measures have been granted either before or after September 30, 2020 by certain foreign and U.S. state jurisdictions, which the Company continues to evaluate and apply, if applicable. The Company filed a PFA with the IRS related to a claim under Internal Revenue Code Section 1341 concerning the tax rate to be applied to the SQ Settlement on the Company’s 2018 tax return. The IRS has agreed to review the position and discussions are ongoing. As a result of the enactment of the U.S. CARES Act, the Company was able to realize a benefit at the higher tax rate on a portion of the SQ Settlement. In 2020, in consideration of the U.S. CARES Act, we revised the PFA, a portion of the long-term receivable previously established for the Section 1341 claim has been reclassified to a current income tax receivable and the related uncertain tax position has been released as part of the tax benefit for the nine months ended September 30, 2020. Any additional income tax benefit resulting from the claim in a future period may be recognized as appropriate in accordance with the guidance in ASC 740 on the accounting for uncertain tax positions. There can be no assurance that this amount or any amount will be recovered as a result of this claim. The Company files income tax returns in the U.S., in various states and in certain foreign jurisdictions. The Company has recorded liabilities to cover certain uncertain tax positions. Such uncertain tax positions relate to additional taxes that the Company may be required to pay in various tax jurisdictions. During the course of examinations by various taxing authorities, proposed adjustments may be asserted. The Company evaluates such items on a case-by-case basis and adjusts the accrual for uncertain tax positions as deemed necessary.
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(LOSS) EARNINGS PER COMMON SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(LOSS) EARNINGS PER COMMON SHARE |
The following table sets forth the computation of basic and diluted loss per share:
In periods of net loss, options, RSUs, and PSUs are anti-dilutive and therefore excluded from the earnings per share calculation.
PSUs are offered to key employees and are subject to achievement of specified performance conditions. Contingently issuable shares are excluded from the computation of diluted earnings per share if, based on current period results, the shares would not be issuable if the end of the reporting period were the end of the contingency period. If such goals are not met, no compensation expense is recognized, and any previously recognized compensation expense is reversed.
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SEGMENT REPORTING |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT REPORTING |
Beginning in the first quarter of 2020, we have changed our measure of segment profitability to Adjusted Income from Operations. Adjusted Income from Operations is Income (Loss) from Operations excluding certain specified items, including Intangible Amortization. Beginning in the first quarter of 2020, we presented our operations in Puerto Rico, which historically had been reported in our International reportable segment, in our North America reportable segment. During the second quarter of 2020, we presented CRS, which historically had been reported in Other, in our North America reportable segment. The segments were updated to reflect how the chief operating decision maker evaluates performance, determines resource allocation and develops and executes strategies to drive growth and profitability. See Part I, Item I. Financial Statements Note 3 Restructuring, Divestitures and Impairments. As a result of these changes in segment reporting, all applicable historical segment information has been recast to conform to the new presentation. Our reportable segments are: •North America •International •Other (which includes costs related to corporate enabling shared services functions and stock-based compensation) The following tables show financial information for the Company's reportable segments:
The following table reconciles the Company's primary measure of segment profitability, Adjusted Income from Operations, to Loss from Operations:
Domestic CRS assets of $78.4 million as of September 30, 2020 are now included in the North America reportable segment. Other than the reorganization of our segments described above and the impact of the divestiture discussed in Part I, Item I. Financial Statements Note 3 Restructuring, Divestitures and Impairments, there were no significant changes by reportable segment from the information provided in the Company’s 2019 Form 10-K.
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COMMITMENTS AND CONTINGENCIES |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES |
Environmental Remediation Liabilities Total environmental liabilities were classified as follows:
The reduction in environmental liabilities relates primarily to the Domestic Environmental Solutions business, which was sold on April 6, 2020 and included $27.5 million of environmental remediation liabilities. See Part I, Item I. Financial Statements Note 3 Restructuring, Divestitures and Impairments in the Condensed Consolidated Financial Statements for further information. Legal Proceedings The Company operates in highly regulated industries and responds to regulatory inquiries or investigations from time to time that may be initiated for a variety of reasons. At any given time, the Company has matters at various stages of resolution with the applicable government authorities. The Company is also routinely involved in actual or threatened legal actions, including those involving alleged personal injuries and commercial, employment, environmental, tax, and other issues. The outcomes of these matters are not within the Company’s complete control and may not be known for prolonged periods of time. In some actions, claimants seek damages, as well as other relief, including injunctive relief, that could require significant expenditures or result in lost revenue. In accordance with applicable accounting standards, the Company establishes an accrued liability for loss contingencies related to legal and regulatory matters when the loss is both probable and reasonably estimable. If the reasonable estimate of a probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is accrued. If a loss is not probable or a probable loss is not reasonably estimable, no liability is recorded. When determining the estimated loss or range of loss, significant judgment is required to estimate the amount and timing of a loss to be recorded. These accruals represent management’s best estimate of probable losses and, in such cases, there may be an exposure to loss in excess of the amounts accrued. Estimates of probable losses resulting from litigation and regulatory proceedings are difficult to predict. Legal and regulatory matters inherently involve significant uncertainties based on, among other factors, the jurisdiction and stage of the proceedings, developments in the applicable facts or law, and the unpredictability of the ultimate determination of the merits of any claim, any defenses the Company may assert against that claim and the amount of any damages that may be awarded. The Company’s accrued liabilities for loss contingencies related to legal and regulatory matters may change in the future as a result of new developments, including, but not limited to, the occurrence of new legal matters, changes in the law or regulatory environment, adverse or favorable rulings, newly discovered facts relevant to the matter, or changes in the strategy for the matter. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Contract Class Action and Opt Out Lawsuits. Beginning on March 12, 2013, the Company was served with several class action complaints filed in federal and state courts in several jurisdictions. These complaints asserted, among other things, that the Company had imposed unauthorized or excessive price increases and other charges on its customers in breach of its contracts and in violation of the Illinois Consumer Fraud and Deceptive Business Practices Act. The complaints sought certification of the lawsuit as a class action and the award to class members of appropriate damages and injunctive relief. These related actions were ultimately transferred to the United States District Court for the Northern District of Illinois for centralized pretrial proceedings. The parties engaged in discussions through and overseen by a mediator regarding a potential resolution of the matter and reached a settlement agreement, as previously disclosed, which settlement agreement obtained court approval on March 8, 2018 (the “SQ Settlement”). Under the terms of the SQ Settlement, the Company admitted no fault or wrongdoing whatsoever, and it entered into the SQ Settlement to avoid the cost and uncertainty of litigation. Certain class members who have opted out of the Final SQ Settlement have filed lawsuits against the Company, and the Company will defend and resolve those actions. The Company has made an accrual in respect of these collective matters consistent with its accrual policies described above, which is not material. Securities Class Action and Opt Out Lawsuits. On July 11, 2016, two purported stockholders filed a putative class action complaint in the U.S. District Court for the Northern District of Illinois, which was subsequently amended. As amended, the complaint purported to assert claims on behalf of all purchasers of the Company’s publicly traded securities between February 7, 2013 and February 21, 2018, inclusive, and all those who purchased securities in the Company’s public offering of depository shares on or around September 15, 2015. The complaint named as defendants the Company, its directors and certain of its current and former officers, and certain of the underwriters in the public offering. The complaint purported to assert claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as well as SEC Rule 10b-5, promulgated thereunder. The complaint alleged, among other things, that the Company imposed unauthorized or excessive price increases and other charges on its customers in breach of its contracts, and that defendants failed to disclose those alleged practices in public filings and other statements issued during the proposed class period. Defendants filed a motion to dismiss. Before the court had ruled on the pending motion to dismiss, the parties engaged in discussions through and overseen by a mediator regarding a potential resolution of the matter and reached a settlement agreement as previously disclosed (the “Securities Class Action Settlement”). The court held a final fairness hearing on July 22, 2019, at which it granted final approval of the Securities Class Action Settlement and took under advisement the amount of attorneys’ fees to be awarded to plaintiffs’ counsel from the settlement fund. Under the terms of the Securities Class Action Settlement, the Company admitted no fault or wrongdoing whatsoever, and it entered into the Securities Class Action Settlement to avoid the cost and uncertainty of litigation. Certain class members who have opted out of the Final Securities Class Action Settlement have filed lawsuits against the Company. On March 6, 2020, the Company filed motions to dismiss these actions, which motions remain pending. The Company intends to defend these actions vigorously and resolve them as appropriate. The Company has made an accrual in respect of these lawsuits consistent with its accrual policies described above, which is not material. U.S. Government Investigations. On June 12, 2017, the SEC issued a subpoena to the Company, requesting documents and information relating to the Company’s compliance with the FCPA or other foreign or domestic anti-corruption laws with respect to certain of the Company’s operations in Latin America. In addition, the DOJ notified the Company that it was investigating this matter in parallel with the SEC. The Company is cooperating with these agencies and certain foreign authorities. The Company is also conducting an internal investigation of these and other matters, including outside of Latin America, under the oversight of the Audit Committee of the Board of Directors and with the assistance of outside counsel, and this investigation has found evidence of improper conduct. As part of the FCPA investigation discussed above, the SEC has requested certain additional information from the Company. On July 29, 2019, the SEC issued a subpoena to the Company requesting documents relating to the Company’s pricing practices concerning small quantity customers, as alleged in the Contract Class Actions and in the Securities Class Action. The Company is cooperating with the SEC’s request. The Company has been informed that the office of the United States Attorney for the Southern District of New York is conducting a False Claims Act investigation related to Stericycle’s collection, transportation and disposal of hazardous waste. The Company has separately been informed that the State of California Department of Justice has opened a similar investigation with respect to government customers in California. The Company is cooperating with both investigations. The Company has not accrued any amounts in respect of the foregoing matters, as it cannot estimate any reasonably possible loss or any range of reasonably possible losses that the Company may incur. The Company is unable to make such an estimate because, based on what the Company knows now, in the Company’s judgment, the factual and legal issues presented in this matter are sufficiently unique that the Company is unable to identify other circumstances sufficiently comparable to provide guidance in making estimates. Environmental and Regulatory Matters. The Company is regulated by federal, state and local laws enacted to regulate the discharge of materials into the environment, the generation, transportation and disposal of waste, and the cleanup of contaminated soil and groundwater and protection of the environment. Because of the highly regulated nature of its business, the Company frequently becomes a party to legal or administrative proceedings involving various governmental authorities and other interested parties. The issues involved in these proceedings generally relate to alleged violations of existing permits and licenses or alleged responsibility under federal or state Superfund laws to remediate contamination at properties owned either by the Company or by other parties to which either the Company or the prior owners of certain of its facilities shipped waste. From time to time, the Company may be subject to fines or penalties in regulatory proceedings relating primarily to waste treatment, storage or disposal facilities. Effective April 6, 2020, the Company completed the divestiture of its Domestic Environmental Solutions business, including the facility in Rancho Cordova, California, to Harsco Corporation. Pursuant to the Purchase Agreement, the Company may be subject to certain indemnification claims for matters relating to those Domestic Environmental Solutions facilities. North Salt Lake, Utah. The Company has continued to toll the statute of limitations with the USAO for the District of Utah relating to an investigation by the EPA into past Clean Air Act emissions and permit requirements, as previously alleged in the NOV issued by the State of Utah DAQ. The NOV resulted in the Company’s December 2014 settlement with the DAQ, as previously disclosed. The parties have reached agreement in principle, to be documented in the form of a civil consent decree, under which the Company will undertake a Supplemental Environmental Project and pay a civil penalty under the Clean Air Act. The Company has accrued the total amount of the agreement in principle, which is not material. Tabasco, Mexico. In late 2016, the ASEA in Mexico conducted a permit compliance inspection at a hazardous waste treatment facility acquired by one of the Company’s subsidiaries in Dos Bocas, Tabasco, Mexico. The ASEA subsequently claimed that the soil treatment process described in the facility’s treatment permit had not been followed properly and issued an order imposing a fine and directing that the facility be closed and that alleged contamination on a certain portion of the facility be remediated. The Company’s subsidiary has engaged a firm of environmental technicians to assess the contamination described in the ASEA order and to conduct a broader environmental assessment of the facility. The Company’s review and assessment of the overall facility is ongoing. In November 2017, the ASEA rescinded the prior order imposing the fine. After reassessing the evidence and arguments presented, the ASEA issued a new resolution on March 9, 2018, containing a lower, revised fine and including remedial obligations. In March 2018, the Company submitted a proposal for remedial measures. On April 26, 2018, the Company appealed the fines in the most recent order. In December 2018, the ASEA approved the Company’s remedial plan for the facility, which will involve an amendment to the facility’s permit to allow for on-site, in-situ remediation of the one treatment cell subject to ASEA’s original order. In June 2018, the Company instituted both civil and criminal legal proceedings in Mexico against the company from which it acquired the relevant facility, seeking to hold the seller liable for any remediation as well as lost profits and damages. The defendants named in the civil complaint filed their answers in September 2018 and evidence is being heard in this matter. The Company has accrued its estimate of the probable loss and costs necessary to comply with the ASEA order and remediate the treatment cell, which are not material. Rancho Cordova, California. On June 25 and 26, 2018, the California DTSC conducted a Compliance Enforcement Inspection of the Company’s Domestic Environmental Solutions facility in Rancho Cordova, California. On February 14, 2020, DTSC filed an action in the Superior Court for the State of California, Sacramento Division, alleging violations of California’s Hazardous Waste Control Law and the facility’s hazardous waste permit arising from the inspection. That action is ongoing. Separately, on August 15, 2019, the Company received from DTSC a written Intent to Deny Hazardous Waste Facility Permit application for the Rancho Cordova facility. A public hearing was held on September 22, 2019, and the public comment period closed on October 25, 2019. The Company entered a written submission as part of that process. On August 27, 2020, DTSC issued a Notice of Denial of Hazardous Waste Facility Permit Application and on September 25, 2020, the Company filed a Petition for Review, which instituted an administrative appeal of DTSC’s action. The Company has not accrued any amounts in respect of these alleged violations and cannot estimate the reasonably possible loss or the range of reasonably possible losses that it may incur. The Company is unable to make such an estimate because (i) litigation is by its nature uncertain and unpredictable and (ii) in the Company’s judgment, the factual and legal allegations asserted by plaintiffs are sufficiently unique that it is unable to identify other proceedings with circumstances sufficiently comparable to provide guidance in making estimates. DEA Investigation – Rancho Cordova, California and Indianapolis, Indiana. On February 11, 2020, the Company received an administrative subpoena from the DEA, which executed a search warrant at the Company’s Domestic Environmental Solutions facility at Rancho Cordova, California and an administrative inspection warrant at the Company’s facility in Indianapolis, Indiana for materials related to the Domestic Environmental Solutions business of shipping and destroying controlled substances. On that same day, agents from the DTSC executed a separate search warrant at the Rancho Cordova facility. The Company is cooperating with the DEA and DTSC in response to their investigations, including with the government’s activity at the Rancho Cordova and Indianapolis facilities. The Company has not accrued any amounts in respect of these investigations and cannot estimate the reasonably possible loss or the range of reasonably possible losses that it may incur. The Company is unable to make such an estimate because (i) litigation is by its nature uncertain and unpredictable and (ii) in the Company’s judgment, the factual and legal allegations asserted by plaintiffs are sufficiently unique that it is unable to identify other proceedings with circumstances sufficiently comparable to provide guidance in making estimates. The Company intends to vigorously defend itself against these allegations and actions. European Retrovirus Investigations. In conjunction with Europol, governmental authorities of Spain and Romania have conducted coordinated inspections of a large number of medical waste management facilities, including Stericycle facilities, relating to the transportation, management and disposal of waste that may be infected with the COVID-19 virus, and related matters. The Company is cooperating with these investigations. The Company has not accrued any amounts in respect of this matter, as it cannot estimate any reasonably possible loss or any range of reasonably possible losses that the Company may incur. The Company is unable to make such an estimate because, based on what the Company knows now, in the Company’s judgment, the factual and legal issues presented in this matter are sufficiently unique that the Company is unable to identify other circumstances sufficiently comparable to provide guidance in making estimates.
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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation: The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of Stericycle, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company's Condensed Consolidated Financial Statements were prepared in accordance with U.S. GAAP and include the assets, liabilities, revenues and expenses of all wholly owned subsidiaries and majority-owned subsidiaries over which the Company exercises control. Outside shareholders' interests in subsidiaries are shown on the Condensed Consolidated Financial Statements as “Noncontrolling interests." The accompanying unaudited Condensed Consolidated Financial Statements as of September 30, 2020 and for the three and nine months ended September 30, 2020 and 2019 have been prepared pursuant to the rules and regulations of the SEC for interim reporting and, therefore, do not include all information and footnote disclosures normally included in audited financial statements prepared in conformity with U.S. GAAP. In the opinion of management, however, all adjustments, consisting of normal recurring adjustments necessary to present fairly the results of operations, financial position and cash flows have been made. These Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto included in the 2019 Form 10-K. The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the full year or any other period.
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Use of Estimates | Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Some areas where the Company makes estimates include its allowance for doubtful accounts, credit memo reserve, accrued employee health and welfare benefits, environmental liabilities, stock-based compensation expense, income tax liabilities, accrued auto and workers’ compensation insurance claims, operating lease ROU assets and lease liabilities, intangible asset valuations, and long-lived asset and goodwill impairment assessments. Actual results could differ from the Company's estimates. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts: The Company reports accounts receivable at their net realizable value, which is management’s best estimate of the cash that will ultimately be received. The Company maintains an allowance for doubtful accounts to reflect the expected uncollectability of accounts receivable based on historical collection data and specific risks identified among uncollected accounts, as well as management’s expectation of future economic conditions. If current or expected future economic trends, events, or changes in circumstances indicate that specific receivable balances may be impaired, further consideration is given to the collectability of those balances and the allowance is adjusted accordingly. The adequacy of allowances for uncollectible accounts is reviewed at least quarterly and adjusted as necessary based on such reviews. Management’s judgment is required to assess the collectability of an account, based on detailed analysis of the aging of the receivables, the creditworthiness of the Company’s customers, historical collection trends, and current and future expected economic trends. Accounts receivable written off in subsequent periods can differ from the allowance for doubtful accounts provided, but historically the Company’s provision has been adequate.
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New Accounting Standards Adopted and Issued | Adoption of New Accounting Standards Financial Instrument Credit Losses In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”) associated with the measurement of credit losses on financial instruments. ASU 2016-13 replaces the prior incurred loss impairment methodology of recognizing credit losses when a loss was probable, with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to assess credit loss estimates. The amended guidance was effective for the Company on January 1, 2020. The Company recognized a net decrease to Retained earnings in the Condensed Consolidated Financial Statements of $2.5 million as of January 1, 2020 for the cumulative effect of adopting ASU 2016-13. Implementation Costs Incurred in a Cloud Computing Arrangement In August 2018, the FASB issued ASU 2018-15, “Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” (“ASU 2018-15”). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs for internal-use software. The accounting for any hosting contract is unchanged. ASU 2018-15 was effective on January 1, 2020 and was adopted prospectively for implementation costs incurred after the date of adoption. The adoption of ASU 2018-15 did not have a material impact on the Condensed Consolidated Financial Statements. Accounting Standards Issued But Not Yet Adopted Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 attempts to simplify aspects of accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods within that fiscal year. Early adoption is permitted for all entities. The Company plans to adopt ASU 2019-12 effective January 1, 2021.
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REVENUES FROM CONTRACTS WITH CUSTOMERS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Revenues Disaggregated by Service, Primary Geographical Regions and Timing of Revenue Recognition | The following table presents revenues disaggregated by service and reportable segments:
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Schedule of Total Contract Acquisition Costs | Total contract acquisition costs, net of accumulated amortization, were classified as follows:
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RESTRUCTURING, DIVESTITURES, AND IMPAIRMENTS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Impairments | Impairments:
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GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill by reportable segment were as follows:
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Intangible Assets | Intangible assets were as follows:
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Changes in Carrying Amount of Intangible Assets | Changes in the carrying amount of intangible assets were as follows:
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Estimated Amortization Expense | The estimated amortization expense for each of the next five years (based upon exchange rates at September 30, 2020) is as follows for the years ending December 31:
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LONG-TERM DEBT (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-Term Debt | The Company’s long-term debt consisted of the following:
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Schedule of Outstanding Letters of Credit and the Unused Portion of Senior Credit Facility | Amounts committed to outstanding letters of credit and the unused portion of the Company’s Senior Credit Facility were as follows:
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(LOSS) EARNINGS PER COMMON SHARE (Tables) |
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Basic and Diluted Loss Per Share | The following table sets forth the computation of basic and diluted loss per share:
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Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | In periods of net loss, options, RSUs, and PSUs are anti-dilutive and therefore excluded from the earnings per share calculation.
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SEGMENT REPORTING (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Information Concerning Company's Reportable Segments | The following tables show financial information for the Company's reportable segments:
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Reconciliation of Company's Primary Measure of Segment Profitability Adjusted Income from Operations to Income (loss) from Operations | The following table reconciles the Company's primary measure of segment profitability, Adjusted Income from Operations, to Loss from Operations:
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COMMITMENTS AND CONTINGENCIES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Total Environmental Liabilities | Total environmental liabilities were classified as follows:
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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Detail) - USD ($) $ in Millions |
9 Months Ended | ||
---|---|---|---|
Jan. 01, 2020 |
Sep. 30, 2020 |
Dec. 31, 2019 |
|
Significant Accounting Policies [Line Items] | |||
Allowance for doubtful accounts | $ 55.4 | $ 67.9 | |
ASU 2016-13 | |||
Significant Accounting Policies [Line Items] | |||
Recognized net decrease to retained earnings | $ 2.5 | ||
ASU 2016-13 | Restatement Adjustment | |||
Significant Accounting Policies [Line Items] | |||
Recognized net decrease to retained earnings | $ 2.5 |
REVENUES FROM CONTRACTS WITH CUSTOMERS - Narrative (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
Dec. 31, 2019 |
|
Revenue from Contract with Customer [Abstract] | |||||
Contract liability | $ 9.5 | $ 9.5 | $ 12.2 | ||
Contract acquisition costs weighted average estimated period | 6 years 4 months 24 days | ||||
Amortized deferred sales incentive cost | $ 2.7 | $ 2.2 | $ 7.8 | $ 6.5 |
REVENUES FROM CONTRACTS WITH CUSTOMERS - Schedule of Total Contract Acquisition Costs (Detail) - USD ($) $ in Millions |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Disaggregation of Revenue [Line Items] | ||
Total contract acquisition costs | $ 40.6 | $ 38.4 |
Other Current Assets | ||
Disaggregation of Revenue [Line Items] | ||
Total contract acquisition costs | 10.6 | 9.5 |
Other Noncurrent Assets | ||
Disaggregation of Revenue [Line Items] | ||
Total contract acquisition costs | $ 30.0 | $ 28.9 |
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amount of Goodwill (Detail) $ in Millions |
9 Months Ended |
---|---|
Sep. 30, 2020
USD ($)
| |
Goodwill [Roll Forward] | |
Beginning Balance | $ 2,982.2 |
Divestitures (Note 3) | (182.8) |
Changes due to foreign currency fluctuations | 2.4 |
Ending Balance | 2,801.8 |
North America | |
Goodwill [Roll Forward] | |
Beginning Balance | 2,631.6 |
Divestitures (Note 3) | (182.8) |
Changes due to foreign currency fluctuations | 0.0 |
Ending Balance | 2,448.8 |
International | |
Goodwill [Roll Forward] | |
Beginning Balance | 350.6 |
Divestitures (Note 3) | 0.0 |
Changes due to foreign currency fluctuations | 2.4 |
Ending Balance | $ 353.0 |
GOODWILL AND OTHER INTANGIBLE ASSETS - Narrative (Detail) - USD ($) |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Mar. 31, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
Dec. 31, 2019 |
|
Intangible Assets By Major Class [Line Items] | ||||||
Goodwill impairment | $ 0 | $ 0 | $ 0 | $ 20,900,000 | ||
Goodwill | $ 2,801,800,000 | $ 2,801,800,000 | $ 2,982,200,000 | |||
Latin America | ||||||
Intangible Assets By Major Class [Line Items] | ||||||
Goodwill impairment | $ 20,900,000 | |||||
Goodwill | $ 0 |
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amount of Intangible Assets (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Finite-lived and Indefinite-lived Intangible Assets [Roll Forward] | ||||
Beginning balance | $ 1,422.4 | |||
Impairments during the period | (8.5) | |||
Divestitures | (193.6) | |||
Amortization during the period | $ (31.4) | $ (35.8) | (94.5) | $ (110.5) |
Changes due to foreign currency fluctuations | (3.4) | |||
Ending balance | $ 1,122.4 | $ 1,122.4 |
GOODWILL AND OTHER INTANGIBLE ASSETS - Estimated Amortization Expense (Detail) $ in Millions |
Sep. 30, 2020
USD ($)
|
---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 (remainder) | $ 29.7 |
2021 | 114.6 |
2022 | 113.2 |
2023 | 112.4 |
2024 | $ 110.9 |
LONG-TERM DEBT - Schedule of Long-Term Debt (Parenthetical) (Detail) - USD ($) |
3 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2020 |
Dec. 31, 2019 |
|
Line of credit | Senior Credit Facility Due June Twenty Twenty Two [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity of line of credit facility | $ 1,200,000,000 | |
Term Loan | Term Loan Facility Due Twenty Twenty Two [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity of line of credit facility | 1,300,000,000 | |
Senior Notes | Senior Notes Facility Due 2024 | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity of line of credit facility | $ 600,000,000 | |
Promissory notes and deferred consideration | Notes Weighted Average Maturity Two Point Three Years And Two Point Five Years [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, maturity | 2 years 1 month 6 days | 2 years 6 months |
Foreign bank debt | 1.4 years and 1.6 years | ||
Debt Instrument [Line Items] | ||
Long-term debt, maturity | 1 year 2 months 12 days | 1 year 7 months 6 days |
LONG-TERM DEBT - Schedule of Outstanding Letters of Credit and the Unused Portion of Senior Credit Facility (Detail) - Senior credit facility - Line of credit - USD ($) $ in Millions |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Debt Instrument [Line Items] | ||
Outstanding letters of credit under Senior Credit Facility | $ 80.7 | $ 33.0 |
Unused portion of the Senior Credit Facility | $ 591.7 | $ 408.3 |
INCOME TAXES - Additional Information (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Income Tax Disclosure [Abstract] | ||||
Income tax (benefit) expense | $ 6.5 | $ (8.6) | $ (23.2) | $ (8.0) |
Effective tax rate | 8.70% | (12.70%) | 18.10% | 5.90% |
Tax benefit from net operating losses carry back related to CARES Act | $ 39.4 | |||
Refunds anticipated in conjunction with previously recongnized net operating losses related to CARES Act | $ 100.0 | $ 100.0 |
(LOSS) EARNINGS PER COMMON SHARE - Computation of Basic and Diluted Loss Per Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Numerator: | ||||
Net loss attributable to Stericycle, Inc. common shareholders | $ (81.2) | $ (59.2) | $ (105.8) | $ (127.5) |
Denominator: | ||||
Denominator for basic loss per share - weighted average shares (in shares) | 91.5 | 91.1 | 91.4 | 91.0 |
Effect of dilutive securities: | ||||
Diluted (in shares) | 91.5 | 91.1 | 91.4 | 91.0 |
Loss per share - Basic (in dollars per share) | $ (0.89) | $ (0.65) | $ (1.16) | $ (1.40) |
Loss per share - Diluted (in dollars per share) | $ (0.89) | $ (0.65) | $ (1.16) | $ (1.40) |
(LOSS) EARNINGS PER COMMON SHARE - Schedule of Antidilutive Securities Excluded from EPS Calculation (Detail) - shares shares in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Stock Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Shares excluded from computation of diluted loss per share | 2,691 | 4,469 | 3,190 | 4,663 |
Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Shares excluded from computation of diluted loss per share | 278 | 335 | 281 | 239 |
SEGMENT REPORTING - Financial Information Concerning Company's Reportable Segments (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Segment Reporting Information [Line Items] | ||||
Revenue | $ 636.4 | $ 833.1 | $ 2,019.6 | $ 2,509.0 |
Adjusted Income from Operations | 101.0 | 118.8 | 280.1 | 329.4 |
North America | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 517.1 | 691.9 | 1,663.0 | 2,076.2 |
Adjusted Income from Operations | 157.0 | 155.5 | 447.0 | 444.7 |
International | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 119.3 | 141.2 | 356.6 | 432.8 |
Adjusted Income from Operations | 15.4 | 20.0 | 32.3 | 53.1 |
Other | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted Income from Operations | $ (71.4) | $ (56.7) | $ (199.2) | $ (168.4) |
SEGMENT REPORTING - Reconciliation of Company's Primary Measure of Segment Profitability Adjusted Income from Operations to Income (loss) from Operations (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Segment Reporting [Abstract] | ||||
Total Reportable Segment Adjusted Income from Operations | $ 101.0 | $ 118.8 | $ 280.1 | $ 329.4 |
Business Transformation | (10.7) | (17.1) | (37.9) | (51.6) |
Intangible Amortization | (31.4) | (35.8) | (94.5) | (110.5) |
Acquisition and Integration | 0.0 | (1.6) | 0.0 | (3.5) |
Operational Optimization | (3.1) | (3.9) | (3.1) | (11.1) |
Divestitures (including Divestiture (losses) gains, net) | (105.4) | (85.3) | (172.9) | (87.4) |
Litigation, Settlements and Regulatory Compliance | (3.5) | (2.4) | (12.1) | (21.3) |
Goodwill Impairment | 0.0 | 0.0 | 0.0 | (20.9) |
Asset Impairments | (0.6) | 0.0 | (12.9) | (3.7) |
Other | (2.1) | (7.2) | (8.0) | (32.8) |
Loss from operations | $ (55.8) | $ (34.5) | $ (61.3) | $ (13.4) |
SEGMENT REPORTING - Additional Information (Detail) - USD ($) $ in Millions |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Company segment reporting assets | $ 5,633.2 | $ 6,437.0 |
North America | ||
Company segment reporting assets | $ 78.4 |
COMMITMENTS AND CONTINGENCIES - Schedule of Total Environmental Liabilities (Detail) - USD ($) $ in Millions |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Loss Contingencies [Line Items] | ||
Environmental remediation liabilities | $ 3.1 | $ 31.9 |
Accrued liabilities | ||
Loss Contingencies [Line Items] | ||
Environmental remediation liabilities | 3.1 | 4.7 |
Other long-term liabilities | ||
Loss Contingencies [Line Items] | ||
Environmental remediation liabilities | $ 0.0 | $ 27.2 |
COMMITMENTS AND CONTINGENCIES - Additional Information (Detail) - USD ($) $ in Millions |
Sep. 30, 2020 |
Apr. 06, 2020 |
Dec. 31, 2019 |
---|---|---|---|
Loss Contingencies [Line Items] | |||
Environmental remediation liabilities | $ 3.1 | $ 31.9 | |
Assets and Liabilities Held for Sale, Not Discontinued Operations | |||
Loss Contingencies [Line Items] | |||
Environmental remediation liabilities | $ 27.5 |
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