PHOENIX--(BUSINESS WIRE)--Oct. 19, 2018-- Mobile Mini, Inc. (NASDAQ GS: MINI) (the “Company” or “Mobile Mini”), the world’s leading supplier of portable storage solutions and a leading provider of tank and pump solutions in the United States, today reported actual and adjusted financial results for the quarter ended September 30, 2018. Highlights discussed below include year-over-year revenue growth of 9.6%, record fleet on rent in the Tank & Pump segment and margin expansion.

Total revenues were $149.7 million and rental revenues were $140.9 million, as compared to $136.6 million and $127.7 million, respectively, for the same period last year. Rental revenues for the Storage Solutions and Tank & Pump Solutions businesses for the current quarter were $112.6 million and $28.3 million, respectively, compared to $104.5 million and $23.2 million, respectively, for the same period last year.

As previously communicated, in July the Company decided to divest of certain underperforming assets. The classification of these assets as held for sale generated a non-cash charge, which was slightly offset by expected proceeds upon disposal. As a result, the Company realized a net loss of $52.2 million, or $1.18 per diluted share, in the third quarter of 2018. The net loss compares to net income of $11.2 million, or $0.25 per diluted share, for the third quarter of 2017. On an adjusted basis, third quarter net income was $19.1 million, or $0.42 per diluted share, as compared to adjusted net income of $11.8 million, or $0.27 per diluted share, for the third quarter of 2017. Adjusted EBITDA was $55.4 million and adjusted EBITDA margin was 37.0% for the third quarter of 2018.

Asset Divestiture

The Company is in the process of divesting the aforementioned underperforming assets. These assets have not generated meaningful revenue over the last several years and therefore this asset disposal should not affect Mobile Mini’s ability to generate revenue or to meet customer demand, nor is this divestiture expected to negatively affect liquidity or free cash flow on a go-forward basis. The $98.3 million loss on divestiture consisted of a non-cash loss of $106.2 million, net of estimated proceeds. Approximately 50% of the assets were divested in the third quarter, and the remaining assets are anticipated to be divested by December 31, 2018. The Company is expecting to generate annual operational savings of $5 million to $7 million over the course of the 12 months following the completion of the divestitures, along with $4 million of reduced depreciation expense.

Dividend

The Company’s Board of Directors declared a cash dividend of 25.0 cents per share, which will be paid on November 28, 2018 to shareholders of record on November 14, 2018.

Third Quarter 2018 Highlights

• Continued strong rental revenue growth in Tank & Pump Solutions with a 21.9% year-over-year increase.
• Delivered solid Storage Solutions rental revenue year-over-year growth of 7.8%.
• Reached all-time high Tank & Pump Solutions’ OEC fleet on rent and drove average OEC utilization to 72.2% for the quarter, up 560 bps compared to the prior-year quarter.
• Increased total Storage Solutions average units on rent by 2.6% year-over-year, with utilization of 84.3% as of September 30, 2018.
• Raised Storage Solutions rental rates by 2.4% year-over-year, with rates on new rentals up 2.3%.
• Expanded adjusted EBITDA margin by 370 basis points to 37.0% and achieved adjusted EBITDA growth of 21.7%, compared to the prior-year quarter.
• Generated strong net cash from operating activities of $46.3 million and free cash flow of $17.5 million.

CEO Comments

Erik Olsson, Mobile Mini’s President and Chief Executive Officer, remarked, “Third quarter results demonstrate that the processes and infrastructure that we have put in place are producing the operational efficiencies and financial results we expected. Our sales strategies continued to drive solid rental revenue growth of 10.4% during the quarter. We converted this top-line growth into 21.7% year-over-year adjusted EBITDA growth and expanded our adjusted EBITDA margin 370 basis points to 37.0% for the third quarter of 2018. This very strong profitability further resulted in $17.5 million of free cash flow.”

Mr. Olsson continued, “Rental revenues for our North American Storage Solutions segment grew 9.5% compared to the prior-year quarter and we believe that our seasonal business will be at similarly strong levels as last year. In our Tank & Pump Solutions business we have begun to see meaningful revenues generated on contracts that we won in late 2017 and early 2018 and we expect increased turnaround activity in the fourth quarter. The pipeline in North America looks healthy and economic indicators are positive, while activity in the U.K. is stable, with increases in rate offsetting a slight decrease in units on rent. For the full year 2018 we anticipate consolidated double-digit revenue growth as compared to 2017, outpacing our Evergreen model, leading to continued strong increases in adjusted EBITDA and free cash flow generation and a decreased leverage ratio.”

Conference Call

Mobile Mini will host a conference call today, Friday, October 19 at 12 noon ET to review these results. To listen to the call live, dial (201) 493-6739 and ask for the Mobile Mini Conference Call or go to www.mobilemini.com and click on the Investors section. Additionally, a slide presentation that will accompany the call will be posted at www.mobilemini.com on the Investor Relations section and will be available in advance and after the call. Please go to the website 15 minutes early to download and install any necessary audio software. If you are unable to listen live, a replay of the call can be accessed for approximately 14 days after the call at Mobile Mini’s website.

About Mobile Mini, Inc.

Mobile Mini, Inc. is the world’s leading provider of portable storage solutions through its total rental fleet of approximately 194,300 storage solutions containers and office units and a leading provider of tank and pump solutions in the U.S., with a rental fleet of approximately 12,600 units. Mobile Mini’s network is comprised of 157 locations in the U.S., U.K., and Canada. Mobile Mini is included on the Russell 2000^® and 3000^® Indexes and the S&P Small Cap Index.

Forward-Looking Statements

This news release contains forward-looking statements, including, but not limited to, expected operational savings from the asset disposal, our ability to generate revenue or to meet customer demand despite the disposal, the continued growth of revenue, adjusted EBITDA, and free cash flow, our ability to decrease our leverage ratio, expected levels of seasonal business from our North American Storage Solutions business, and the level of turn around activity of our Tank & Pump Solutions business, all of which involve risks and uncertainties that could cause actual results to differ materially from those currently anticipated. Risks and uncertainties that may affect future results include those that are described from time to time in the Company’s filings with the Securities and Exchange Commission (“SEC”). These forward-looking statements represent the judgment of the Company, as of the date of this release, and Mobile Mini disclaims any intent or obligation to update forward-looking statements.

(See accompanying tables)

Non-GAAP Financial Information

In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company also discloses in this press release certain non-GAAP financial information. These financial measures are not recognized measures under GAAP and they are not intended to be and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Adjusted net income, adjusted diluted earnings per share, EBITDA, adjusted EBITDA, EBITDA margin, adjusted EBITDA margin and free cash flow are non-GAAP financial measures as defined by SEC rules. This non-GAAP financial information may be determined or calculated differently by other companies. Reconciliations of these non-GAAP measurements to the most directly comparable GAAP financial measurements are furnished earlier in this release and as follows:

Adjusted net income and adjusted diluted earnings per share. Adjusted net income and related earnings per share information exclude certain transactions that management believes are not indicative of our business. We believe that the inclusion of this non-GAAP presentation makes it easier to compare our financial performance across reporting periods on a consistent basis.

EBITDA and adjusted EBITDA. EBITDA is defined as net income before discontinued operations, net of tax (if applicable), interest expense, income taxes, depreciation and amortization, and debt restructuring or extinguishment expense (if applicable), including any write-off of deferred financing costs. Adjusted EBITDA further excludes certain non-cash expenses, including share-based compensation, as well as transactions that management believes are not indicative of our business. Because EBITDA and adjusted EBITDA, as defined, exclude some but not all items that affect our cash flow from operating activities, they may not be comparable to similarly titled performance measures presented by other companies.

We present EBITDA and adjusted EBITDA because we believe they provide useful information regarding our ability to meet our future debt payment requirements, capital expenditures and working capital requirements and an overall evaluation of our financial condition. EBITDA and adjusted EBITDA have certain limitations as analytical tools and should not be used as substitutes for net income, cash flows from operations, or other consolidated income or cash flow data prepared in accordance with GAAP.

EBITDA and adjusted EBITDA margins are calculated as EBITDA and adjusted EBITDA, respectively, divided by total revenues expressed as a percentage.

Free Cash Flow. Free cash flow is defined as net cash provided by operating activities, minus or plus, net cash used in or provided by investing activities, excluding acquisitions and certain transactions. Free cash flow is a non-GAAP financial measure and is not intended to replace net cash provided by operating activities, the most directly comparable financial measure prepared in accordance with GAAP. We present free cash flow because we believe it provides useful information regarding our liquidity and ability to meet our short-term obligations. In particular, free cash flow indicates the amount of cash available after capital expenditures for, among other things, investments in our existing business, debt service obligations, payment of authorized quarterly dividends, repurchase of our common stock and strategic small acquisitions.

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Source: Mobile Mini, Inc.

Mobile Mini, Inc.
Van Welch, 602-308-3879
Executive VP & Chief Financial Officer
www.mobilemini.com
or
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