BALTIMORE , Nov. 1 /PRNewswire-FirstCall/ -- Williams Scotsman International, Inc. (Nasdaq: WLSC), a leading provider of modular space solutions, reported today its financial results for the third quarter of 2005. Revenues for the third quarter were $163.5 million , an 18.4% increase from $138.1 million in the comparable period of 2004. Gross profit was $55.6 million , a 12.6% increase as compared to $49.3 million for the prior year quarter. EBITDA for the current quarter was $43.6 million , which was up 6.6% from $40.8 million in the comparable period of 2004. The current quarter's EBITDA includes a $2.4 million non-cash stock compensation charge related to the Company's recent initial public offering. EBITDA and gross profit includes a $1.0 million charge for the estimated damage to the Company's assets related to recent hurricanes occurring during the quarter offset by recoveries from prior period storms. Excluding these charges, the current quarter's gross profit and EBITDA increased 14.7% and 15.0% respectively as compared to the prior year.
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The Company reported a net loss for the quarter ended September 30, 2005 of $14.7 million or $0.59 per share, which includes a loss on the early extinguishment of debt related to the Company's refinancing transactions as well as the charges discussed above. The effect of these charges was a reduction to net income of $17.6 million (net of related tax benefit of $11.3 million ) or $0.71 per share. Net income for the current quarter, excluding these charges was $2.9 million as compared to $1.0 million for the prior year. Cash flow provided by (used in) operating, investing and financing activities was $26.8 , $(35.0) and $9.0 million , respectively, for the three months ended September 30, 2005 , an increase of approximately $15.1 , $20.0 , and $5.2 million , respectively from the comparable period of 2004.
Nine Months ended September 30, 2005 Results
Revenues for the nine months ended September 30, 2005 were $424.6 million , a 15.0% increase from $369.3 million in the comparable period of 2004. Gross profit was $157.5 million , a 13.1% increase as compared to $139.3 million for the prior year period. EBITDA was $125.2 million for the nine months ended September 30, 2005 , which was up 10.1% from $113.7 million in the comparable period of 2004. EBITDA for the nine months ended September 30, 2005 includes the $2.4 million non-cash stock compensation charge and EBITDA and gross profit includes the $1.0 million charge for the estimated damage to the Company's assets related to recent hurricanes discussed above. Excluding these charges, for the nine months ended September 30, 2005 , gross profit and EBITDA increased 13.8% and 13.1% respectively as compared to the prior year.
The Company reported a net loss for the nine months ended September 30, 2005 of $18.2 million or $0.76 per share, which includes $20.7 million of charges or $0.86 per share (net of the related tax benefit of $13.4 million ), related to the early extinguishment of debt and the $2.4 million non-cash stock compensation charge as a result of our recent financing transactions as well as the hurricane impact discussed above. Net income for the nine months ended September 30, 2005 , excluding these charges was $2.6 million as compared to a loss of $1.2 million for the prior year. Cash flow provided by (used in) operating, investing and financing activities was $46.3 , $(94.7), and $49.0 million , respectively, for the nine months ended September 30, 2005 , an increase of approximately $6.8 , $13.6 and $6.8 million , respectively from the comparable period of 2004.
Business Outlook
The following statements of anticipated results are based on current expectations. These statements are forward-looking, and actual results may differ materially.
The Company estimates the following performance measures for the fourth quarter ending December 31, 2005:
Range (in millions)
Low High
Operating Income $28.0 $29.3
Depreciation and amortization 18.0 17.7
Net income 6.7 7.2
The Company expects that its corporate representatives will meet privately during the quarter with investors, the media, investment analysts and others. At these meetings, the Company may reiterate the Business Outlook published in this press release. At the same time, the Company will keep this press release and Business Outlook publicly available on its Web site (http://www.willscot.com). However, the Business Outlook published in this press release reflects only the Company's current best estimate and the Company assumes no obligation to update the information contained in this press release, including the Business Outlook, at any time.
Williams Scotsman International has scheduled a conference call for November 1, 2005 at 2:00 PM Eastern Time to discuss its third quarter results. To participate in the conference call, dial 888-303-7352 for domestic (212-676-5242 for international) and ask to be placed into the Williams Scotsman call. To listen to a live webcast of the call, go to http://www.willscot.com and click on the Investor Relations Section. A replay of the call will be available approximately two hours after the live broadcast ends and will be accessible until 11:59 PM on November 15, 2005 . To access the replay, domestic callers can dial 800-633-8284 and enter access code 21265730 (international callers can dial 402-977-9140).
About Williams Scotsman International
Williams Scotsman International, Inc., headquartered in Baltimore , Maryland, is a provider of modular space solutions for the construction, education, commercial and industrial, and government markets. The Company serves over 25,000 customers, operating a fleet of over 98,000 modular space and portable storage units that are leased through a network of 85 branches. Williams Scotsman International provides delivery, installation, and other services to its leasing customers, and sells new and used modular space products and services.
For information, visit the Company's website at http://www.willscot.com
All statements other than statements of historical fact included in this press release are forward-looking statements and involve expectations, beliefs, plans, intentions or strategies regarding the future. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it assumes no responsibility for the accuracy and completeness of these forward-looking statements and gives no assurance that these expectations will prove to have been correct. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed under 'Risk Factors' and elsewhere in the Company's 10-K, 10-Q and other SEC filings, including, but not limited to, substantial leverage and its ability to service debt, changing market trends in its industry, general economic and business conditions including a prolonged or substantial recession, its ability to finance fleet and branch expansion and to locate and finance acquisitions, its ability to implement its business and growth strategy and maintain and enhance its competitive strengths, intense industry competition, availability of key personnel and changes in, or the failure to comply with, government regulations. The Company assumes no obligation to update any forward-looking statement. Certain prior year amounts have been reclassified to conform to current year presentation.
Williams Scotsman International, Inc.
Consolidated Balance Sheets
(dollars in thousands)
September 30, December 31,
2005 2004
(Unaudited)
Assets
Cash $1,410 $939
Trade accounts receivable, net 93,762 76,579
Prepaid expenses and other current assets 49,113 38,330
Rental equipment, net 935,243 880,723
Property and equipment, net 80,891 79,951
Deferred financing costs, net 17,822 16,667
Goodwill 170,810 170,423
Other intangible assets 2,912 2,894
Other assets 20,796 18,105
$1,372,759 $1,284,611
Liabilities and stockholders' equity
Accounts payable $74,959 $42,225
Accrued expenses 29,036 27,622
Accrued interest 3,563 12,341
Rents billed in advance 23,701 21,375
Revolving credit facility 371,003 102,130
Long-term debt, net 505,332 907,356
Deferred income taxes 136,238 150,415
Total liabilities 1,143,832 1,263,464
Stockholders' equity:
Common stock 513 362
Additional paid-in capital 463,935 240,474
Cumulative foreign currency
translation adjustment 16,419 14,079
Retained earnings 43,998 62,170
524,865 317,085
Less treasury stock (295,938) (295,938)
Total stockholders' equity 228,927 21,147
$1,372,759 $1,284,611
Williams Scotsman International, Inc.
Consolidated Statements of Operations (unaudited)
(dollars in thousands, except share and per share data)
Quarter Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
Revenues
Leasing $62,556 $57,110 $181,636 $164,775
Sales:
New units 36,921 24,107 83,458 67,913
Rental equipment 10,260 9,737 25,825 20,747
Delivery and
installation 41,756 36,407 101,355 85,653
Other 11,983 10,745 32,318 30,163
Total revenues 163,476 138,106 424,592 369,251
Cost of sales and services
Leasing
Depreciation and
amortization 13,068 12,136 38,435 35,904
Other direct
leasing costs 17,533 13,979 44,501 37,994
Sales:
New units 30,571 20,915 69,115 57,791
Rental equipment 7,898 7,716 20,069 16,514
Delivery and
installation 34,699 31,386 86,245 74,272
Other 4,150 2,632 8,713 7,469
Total cost of sales
and services 107,919 88,764 267,078 229,944
Gross profit 55,557 49,342 157,514 139,307
Selling, general & administrative
expenses (1) 25,063 20,632 70,796 61,556
Other depreciation
and amortization 4,241 3,855 12,183 10,949
Operating Income 26,253 24,855 74,535 66,802
Interest expense 24,496 23,305 73,755 68,750
Loss on early
extinguishment
of debt 25,496 - 30,678 -
(Loss) income
before income
taxes (23,739) 1,550 (29,898) (1,948)
Income tax (benefit)
expense (9,071) 592 (11,726) (736)
Net (loss) income $(14,668) $958 $(18,172) $(1,212)
(Loss) earnings per
share - basic $(0.59) $0.04 $(0.76) $(0.05)
(Loss) earnings per
share - diluted $(0.59) $0.04 $(0.76) $(0.05)
Weighted average common
shares outstanding
- basic 24,877,087 23,558,820 24,003,061 23,558,820
Weighted average
common shares
outstanding
- diluted (2) 24,877,087 24,818,865 24,003,061 23,558,820
(1) Includes non-stock compensation expense of $2.6 million and $0.1
million for the three months ended September 30, 2005 and 2004,
respectively and $3.1 million and $0.5 million for the nine months
ended September 30, 2005 and 2004, respectively.
(2) Common stock equivalents of 1,270,056, 1,233,417 and 1,260,044 were
excluded from weighted average shares - diluted for the quarter
ended September 30, 2005 and the nine months ended September 30,
2005 and 2004 due to their anti-dilutive nature.
Williams Scotsman International, Inc.
Summary of Selected Consolidated Financial Information (unaudited)
Quarter Ended Nine Months Ended
September 30, September 30,
Operations Data
(in thousands): 2005 2004 2005 2004
Gross profit
Leasing $31,955 $30,995 $98,700 $90,877
Sales:
New units 6,350 3,192 14,343 10,122
Rental equipment 2,362 2,021 5,756 4,233
Delivery and
installation 7,057 5,021 15,110 11,381
Other 7,833 8,113 23,605 22,694
Total gross profit $55,557 $49,342 $157,514 $139,307
Quarter Ended Nine Months Ended
September 30, September 30,
Rental Fleet and
Capital Expenditure
Data: 2005 2004 2005 2004
Lease fleet units,
as of end of period 98,300 94,700 98,300 94,700
Lease fleet units,
average for period 97,700 95,100 96,600 93,200
Utilization rate based
upon units, average
over period 82 % 80 % 81 % 80 %
Monthly rental rate,
average over period $264 $250 $260 $249
Capital expenditures (in thousands):
Lease fleet $31,438 $9,169 $81,238 $28,396
Non-lease fleet 3,554 1,816 8,836 5,241
Acquisitions
(in thousands) 14 4,010 4,630 47,480
Other Financial Data
(at period end): September 30, 2005
Leverage Ratio (a) 5.11
Leverage Ratio (b) 13.75
Borrowing base availability
under revolving credit
facility (c) (in thousands) $111,802
(a) As defined in the Company's Amended and Restated Credit Agreement
(b) Calculated using cash flow from operating activities
(c) In June 2005, the Company entered into an Amended and Restated
Credit Agreement, which provides for a revolving credit facility of
$500 million and a $150 million term loan. The Company is not
subject to financial covenants as long as its excess availability
under the revolving credit facility remains above $75 million. As of
September 30, 2005, the Company's excess availability under the
revolver was $112 million or $37 million in excess of the $75
million.
Reconciliation of EBITDA for the quarter and nine months ended September
30, 2005 and 2004 to cash flow from operating activities - the most comparable
GAAP measure:
(in thousands) Quarter Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
EBITDA (d) $43,562 $40,846 $125,153 $113,655
Increase in net
accounts
receivable (6,348) (11,157) (16,653) (24,377)
Increase in accounts
payable and accrued
expenses 28,438 7,612 33,217 22,265
Interest paid (29,833) (11,973) (77,553) (54,071)
Increase in other
assets (10,301) (14,411) (17,464) (17,326)
Increase in other
liabilities 1,051 2,692 2,253 3,116
Non-cash stock
compensation expense 2,582 75 3,120 529
Gain on sale of
equipment (2,344) (2,025) (5,737) (4,242)
Cash flow from
operating
activities $26,807 $11,659 $46,336 $39,549
Other Data:
Cash flow used in
investing
activities $(35,006) $(14,995) $(94,704) $(81,117)
Cash flow provided
by financing
activities $8,963 $3,799 $48,992 $42,219
(d) The Company defines EBITDA as earnings before deducting interest,
loss on extinguishment of debt, income taxes, depreciation and
amortization.
Reconciliation of Consolidated EBITDA, as defined in the credit agreement, to cash flow from operating activities - the most comparable GAAP measure as of September 30, 2005 (in thousands):
Consolidated EBITDA
- trailing 12 months (c) (e) $171,578
Increase in net
accounts receivable (12,403)
Increase in accounts
payable and accrued expenses 29,391
Interest paid (108,385)
Increase in other assets (8,607)
Increase in other liabilities 3,886
Gain on sale of equipment
(including net recovery from hurricanes) (11,334)
Pro forma EBITDA impact of acquisitions (374)
Cash flow from operating
activities - trailing 12 months $63,752
Cash flow from investing
activities - trailing 12 months $(116,524)
Cash flow from financing
activities - trailing 12 months $52,902
(e) Consolidated EBITDA is defined in the Company's credit agreement as
the Company's net income plus interest, taxes, depreciation and
amortization expenses, and excludes (gains) losses on sales of fixed
assets and any other non-cash items, and non-cash stock compensation
charges. Consolidated EBITDA should not be considered in isolation
or as a substitute to cash flow from operating activities, net
income or other measures of performance prepared in accordance with
generally accepted accounting principles or as a measure of the
Company's profitability or liquidity. The Company is providing
consolidated EBITDA as supplemental information so that investors
can evaluate and analyze the Company's compliance with its financial
covenants under the Amended and Restated Credit Facility.
SOURCE Williams Scotsman, Inc.
