Williams Scotsman International, Inc. (NASDAQ:WLSC), a leading
provider of modular space solutions, reported today its financial
results for the second quarter of 2007.
Second Quarter Results
Total revenue for the 2007 second quarter was $203.7 million,
compared to $159.1 million a year ago. Leasing revenues increased
18.1% to $82.9 million from $70.2 million in the prior year quarter,
driven primarily by a 2.1% increase in average units on rent in North
America, and an increase in the average rental rate of $22 to $309
from $287. North American utilization showed a decline to 80% from 82%
a year ago due to idle classroom capacity and storage fleet growth.
The increase in units on rent and average rental rates is
attributable to continued strong performance throughout the Company's
U.S. regions and Canada. The remaining increase in leasing revenue was
driven by the Company's European subsidiary, Wiron, which was acquired
in the third quarter of 2006 and accounted for $5.3 million of the
increase. Sales of new units and rental equipment increased 54.8%
compared to the prior year quarter primarily as a result of increased
sales activities including a large classroom project in Louisiana and
a military project in Hawaii. Delivery and installation revenues
increased 23.6% compared to the prior year quarter as a result of the
above mentioned items.
Gross profit increased by $13.9 million, or 20.5%, to $81.8
million, while the gross profit margin percentage decreased 2.5
percentage points to 40.2% as compared to the prior year second
quarter due to a higher mix of sales related business. The Company
reported net income for the quarter ended June 30, 2007 of $14.6
million, or $0.33 per diluted share, an increase of 26.4% or $0.05 per
diluted share as compared to net income of $11.6 million or $0.27 per
diluted share for the quarter ended June 30, 2006.
Gerry Holthaus, Chairman, President and CEO, commented, "We are
very pleased with the results of our second quarter financial
performance. Our results for the period reflect continued growth in
our U.S regions as well as our focus on our international markets
including the benefit of our European acquisition and continued growth
from our Canadian operations. As a result of these activities, the
Company reported record net income for its second quarter."
"We also announced on July 19, 2007, that the Company agreed to be
acquired by the parent company of Algeco Group, the European space
rental company, in an all-cash transaction for $2.2 billion, which
includes the refinancing of outstanding debt. Under the terms of the
agreement, Williams Scotsman International, Inc. shareholders will
receive $28.25 in cash for each share of Williams Scotsman
International, Inc. common stock they own."
Six Months ended June 30, 2007 Results
Revenues for the six months ended June 30, 2007 were $365.7
million, a 12.8% increase from $324.1 million in the comparable period
of 2006. Gross profit was $155.8 million, a 16.9% increase as compared
to $133.3 million for the prior year period. The Company reported net
income for the six months ended June 30, 2007 of $25.1 million or
$0.57 per share as compared to net income of $22.0 million or $0.53
per share for the six months ended June 30, 2006.
Williams Scotsman International, Inc. has scheduled a conference
call for August 3, 2007 at 10:00 AM Eastern Time to discuss its second
quarter results. To participate in the conference call, dial
888-633-8284 for domestic (212-231-6012 for international) and ask to
be placed into the Williams Scotsman call. To listen to a live webcast
of the call, go to www.willscot.com and click on the Investor
Relations section. Please go to the website 15 minutes early to
download and install any necessary audio software. 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 September 2,
2007. To access the replay, domestic callers can dial 800-633-8284 and
enter access code 21345015 (international callers can dial
402-977-9140).
About Williams Scotsman International, Inc.
Williams Scotsman International, Inc., through its subsidiaries,
is a leading provider of mobile and modular space solutions for
multiple industry sectors, including the Construction, Education,
Commercial, Healthcare and Government markets. The company serves over
30,000 customers, operating a fleet of over 121,000 modular space and
storage units that are leased through a network of over 100 locations
throughout North America and Spain. Williams Scotsman provides
delivery, installation, and other services, and sells new and used
mobile office products. Williams Scotsman also manages large modular
building projects from concept to completion. Williams Scotsman is a
publicly traded company (NASDAQ: WLSC - News) headquartered in
Baltimore, Maryland with operations in the United States, Canada,
Mexico, and Spain. For additional information, visit the company's web
site at www.willscot.com, call (410) 931-6066, or email to
Michele.Cunningham@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.
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Williams Scotsman International, Inc.
Consolidated Balance Sheets
(dollars in thousands)
June 30, December 31,
2007 2006
------------- -------------
(Unaudited)
Assets
Cash $ 1,995 $ 6,495
Trade accounts receivable, net 125,816 120,586
Prepaid expenses and other current assets 69,285 52,938
Rental equipment, net 1,147,523 1,066,469
Property and equipment, net 97,432 92,992
Deferred financing costs, net 17,671 19,277
Goodwill and other intangible assets 225,111 199,788
Other assets, net 36,080 29,374
------------ ------------
Total assets $ 1,720,913 $ 1,587,919
============ ============
Liabilities and stockholders' equity
Accounts payable $ 72,455 $ 58,964
Accrued expenses and other current
liabilities 53,553 50,834
Accrued interest 11,324 12,887
Rents billed in advance 24,598 25,031
Revolving credit facility 357,111 296,892
Long-term debt, net 617,902 619,464
Deferred income taxes 170,701 155,706
------------ ------------
Total liabilities 1,307,644 1,219,778
------------ ------------
Stockholders' equity:
Common stock 562 557
Additional paid-in capital 552,255 545,124
Retained earnings 126,036 100,962
Accumulated other comprehensive income 30,354 17,436
------------ ------------
709,207 664,079
Less treasury stock (295,938) (295,938)
------------ ------------
Total stockholders' equity 413,269 368,141
------------ ------------
Total liabilities and stockholders'
equity $ 1,720,913 $ 1,587,919
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Williams Scotsman International, Inc.
Consolidated Statements of Operations (unaudited)
(dollars in thousands, except per share data)
Quarter ended Six months ended
June 30, June 30,
------------------------ ------------------------
2007 2006 2007 2006
------------ ----------- ----------- ------------
(In thousands except share and per share amounts)
Revenues
Leasing $ 82,859 $ 70,174 $ 163,043 $ 139,057
Sales:
New units 49,401 26,796 78,025 66,742
Rental equipment 14,614 14,564 24,929 25,075
Delivery and
installation 43,162 34,914 73,725 68,940
Other 13,690 12,661 25,953 24,268
------------ ----------- ----------- ------------
Total revenues 203,726 159,109 365,675 324,082
------------ ----------- ----------- ------------
Costs of sales and
services
Leasing:
Depreciation and
amortization 16,426 14,036 32,150 28,226
Other direct
leasing costs 17,367 16,078 32,575 31,128
Sales:
New units 40,449 20,333 62,630 52,641
Rental equipment 10,190 10,391 17,739 18,065
Delivery and
installation 34,534 27,990 59,311 56,088
Other 2,937 2,390 5,492 4,662
------------ ----------- ----------- ------------
Total costs of
sales and
services 121,903 91,218 209,897 190,810
------------ ----------- ----------- ------------
Gross profit 81,823 67,891 155,778 133,272
Selling, general and
administrative
expenses (1) 32,956 26,856 65,676 53,506
Other depreciation
and amortization 5,774 4,372 11,176 8,618
------------ ----------- ----------- ------------
Operating income 43,093 36,663 78,926 71,148
Interest, including
amortization of
deferred financing
costs 19,001 17,824 38,007 35,345
------------ ----------- ----------- ------------
Income before income
taxes 24,092 18,839 40,919 35,803
Income tax expense 9,451 7,257 15,845 13,788
------------ ----------- ----------- ------------
Net income $ 14,641 $ 11,582 $ 25,074 $ 22,015
============ =========== =========== ============
Earnings per common
share $ 0.34 $ 0.28 $ 0.58 $ 0.54
============ =========== =========== ============
Earnings per common
share, assuming
dilution $ 0.33 $ 0.27 $ 0.57 $ 0.53
============ =========== =========== ============
Weighted average
common shares
outstanding - basic 43,514,463 41,487,015 43,340,229 40,737,273
============ =========== =========== ============
Weighted average
common shares
outstanding -
diluted 44,011,544 42,389,358 43,881,493 41,916,080
============ =========== =========== ============
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(1) Includes non-cash stock compensation expense of $0.6 million and
$0.2 million for the three months ended June 30, 2007 and 2006,
respectively and $1.4 million and $0.7 million for the six months
ended June 30, 2007 and 2006, respectively.
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Williams Scotsman International, Inc.
Summary of Selected Consolidated Financial Information (unaudited)
(Dollars in thousands except monthly rental rate)
Quarter Ended Six Months Ended
June 30, June 30,
----------------- -----------------
Operations Data (in thousands): 2007 2006 2007 2006
---------------------------------- -------- -------- -------- --------
Gross profit
Leasing $ 49,066 $ 40,060 $ 98,318 $ 79,703
Sales:
New units 8,952 6,463 15,395 14,101
Rental equipment 4,424 4,173 7,190 7,010
Delivery and installation 8,628 6,924 14,414 12,852
Other 10,753 10,271 20,461 19,606
-------- -------- -------- --------
Total gross profit $ 81,823 $ 67,891 $155,778 $133,272
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North America
Rental Fleet Quarter Ended June 30, Quarter Ended June 30,
Data: 2007 2006
------------------------- -------------------------
Modular Storage Total Modular Storage Total
------- -------- -------- --------- ------- -------
Lease fleet units,
as of end of
period 79,900 25,100 105,000 77,600 22,600 100,200
Lease fleet units,
average for
period 79,400 24,800 104,200 77,600 22,200 99,800
Utilization rate
based upon units,
average for
period 82% 74% 80% 83% 77% 82%
Monthly rental
rate, average
over period $ 368 $ 100 $ 309 $ 337 $ 98 $ 287
Six Months Ended June 30, Six Months Ended June 30,
2007 2006
------------------------- -------------------------
Modular Storage Total Modular Storage Total
------- -------- -------- --------- ------- -------
Lease fleet units,
as of end of
period 79,900 25,100 105,000 77,600 22,600 100,200
Lease fleet units,
average for
period 78,800 24,400 103,200 77,200 22,000 99,200
Utilization rate
based upon units,
average for
period 82% 75% 80% 83% 78% 82%
Monthly rental
rate, average
over period $ 366 $ 99 $ 308 $ 334 $ 98 $ 285
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At June 30, 2007, our European rental fleet totaled approximately
16,400 units, at a utilization rate of 89% and an average rental rate
of $124.
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Quarter Ended Six Months Ended
June 30, June 30,
----------------- -----------------
Capital Expenditure Data (in
thousands): 2007 2006 2007 2006
---------------------------------- -------- -------- -------- --------
Lease fleet, net (a) $ 46,138 $ 27,306 $ 73,590 $ 53,819
Non-lease fleet 5,080 3,994 9,148 6,239
Acquisitions 1,116 -- 43,755 5,123
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Other Financial Data (at period end): June 30, 2007
-------------
Leverage Ratio (b) 3.93x
Leverage Ratio (c) 18.690x
Borrowing base availability under revolving credit
facility (d) (in thousands) $ 161,201
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(a) Capital expenditures are shown net of used units sold
(b) Calculated as total debt divided by Consolidated EBITDA, see
(f) below
(c) Calculated as total debt divided by net income, the most
comparable GAAP measure
(d) Under the Company's Amended and Restated Credit Agreement,
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 June 30, 2007, the Company's
excess availability under the revolver was $161.2 million or
$86.2 million in excess of the $75 million requirement
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Reconciliation of EBITDA for the quarter ended June 30, 2007 and 2006
to net income - the most comparable GAAP measure:
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Quarter Ended Six Months Ended
June 30, June 30,
----------------- -----------------
2007 2006 2007 2006
-------- -------- -------- --------
(in thousands)
EBITDA (e) $ 65,293 $ 55,071 $122,252 $107,992
Less:
Interest expense 19,001 17,824 38,007 35,345
Depreciation and amortization 22,200 18,408 43,326 36,844
Income tax provision 9,451 7,257 15,845 13,788
-------- -------- -------- --------
Net income $ 14,641 $ 11,582 $ 25,074 $ 22,015
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(e) The Company defines EBITDA as earnings before deducting interest,
loss on extinguishment of debt, income taxes, depreciation and
amortization
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Reconciliation of Consolidated EBITDA, as defined below, to net income
- the most comparable GAAP measure for the twelve months ended June
30, 2007 (in thousands):
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Consolidated EBITDA - trailing 12 months (f) $247,891
Less:
Interest expense 71,774
Depreciation and amortization 86,337
Income tax provision 28,075
Non-cash stock compensation expense 3,324
Loss on early extinguishment of debt 90
Pro forma EBITDA impact of acquisitions 6,117
--------
Net income, trailing 12 months $ 52,174
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(f) Consolidated EBITDA is defined as the Company's net income plus
interest, loss on extinguishment of debt, 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 also includes an adjustment to reflect
the estimated full year EBITDA contribution of acquisitions completed
during the period. 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 the Company's performance and debt position. Consolidated
EBITDA of the Company's wholly owned subsidiary, Williams Scotsman,
Inc., is also separately calculated and utilized to assess its
compliance with the financial covenants under the Amended and
Restated Credit Agreement.
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