Mobile Mini Reports Q4’16 Results and Announces 10% Increase in Dividend

February 2, 2017 at 6:30 AM EST

PHOENIX--(BUSINESS WIRE)--Feb. 2, 2017-- 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 specialty containment solutions in the United States, today reported actual and adjusted financial results for the quarter ended December 31, 2016. Total revenues were $130.4 million and rental revenues were $124.2 million, as compared to $134.5 million and $126.5 million, respectively, for the same period last year.

Rental revenues for the portable storage and specialty containment businesses for the current quarter were $101.6 million and $22.5 million, respectively.

The Company recorded net income of $19.5 million, or $0.44 per diluted share, in the fourth quarter of 2016, as compared to net income of $9.5 million, or $0.21 per diluted share, for the fourth quarter of 2015. On an adjusted basis, fourth quarter net income was $21.2 million, or $0.48 per diluted share, compared to adjusted net income of $18.4 million, or $0.41 per diluted share, for the fourth quarter of 2015. Adjusted EBITDA was $54.2 million and adjusted EBITDA margin was 41.2% for the fourth quarter of 2016, up 30 basis points from the adjusted EBITDA margin in the fourth quarter of 2015.

Dividend

The Company’s Board of Directors increased the Company’s quarterly cash dividend, beginning in the first quarter of 2017, to 22.7 cents per share, a 10% increase as compared to the fourth quarter 2016 cash dividend. The dividend will be paid on March 15, 2017 to shareholders of record on March 1, 2017.

Fourth Quarter 2016 Highlights

Drove a 2.1% increase in North America portable storage quarterly core activations, which contributed to an all-time high for total portable storage units on rent during the quarter ended December 31, 2016.
Delivered the highest level of seasonal units on rent in company history.
Raised portable storage rental rates by 2.9% year-over-year and 1.6% over the third quarter of 2016; rates on new rentals were up 2.1% year-over-year.
Increased portable storage rental revenues 3.3% year-over-year on a constant currency basis. Not adjusting for unfavorable currency fluctuations, portable storage rental revenues decreased 0.5%.
Maintained steady downstream specialty containment rental revenues year-over-year.
Achieved adjusted EBITDA of $54.2 million, with an adjusted EBITDA margin of 41.2%.
Drove portable storage unit utilization to an average of 75.2% during the quarter, up 120 basis points from the prior-year period.
Generated net cash from operating activities of $40.2 million and strong free cash flow of $27.7 million, marking our 36^th consecutive quarter of positive free cash flow.

CEO Comments

Erik Olsson, Mobile Mini’s President and Chief Executive Officer, remarked, “We continued to drive portable storage pricing, with a solid 2.9% increase this quarter compared to the prior-year period, marking the sixteenth consecutive quarter of price increases, resulting in total year-over-year rental revenue growth of 3.3% in the fourth quarter of 2016. North American core activations increased 2.1% over the prior-year period, demonstrating that we are gaining traction in the overall development and success of our salesforce. The development of our Inside Sales Representatives through revised hiring processes, incremental sales management and focused training remains an immediate priority and I am pleased to say that we saw stabilization of turnover during the quarter.”

Mr. Olsson continued, “In our specialty containment business, downstream rental revenues remained healthy at levels similar to the prior year. However, challenges resulting largely from weak commodity prices continued to negatively affect our remaining specialty containment lines. We are well situated to benefit in 2017 from organic growth in the downstream business at existing branches, as well as through the utilization of the existing portable storage footprint to support geographic growth. We enter 2017 in a position of strength and poised to capitalize on our robust infrastructure and strengthened salesforce, which we expect to result in free cash flow growth in 2017.”

Conference Call

Mobile Mini will host a conference call today, Thursday, February 2, 2017 at 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 211,300 portable storage containers and office units. Through its wholly-owned subsidiary, Evergreen Tank Solutions, Mobile Mini is also a leading provider of specialty containment solutions in the U.S., with a rental fleet of approximately 12,100 units. Mobile Mini’s network is comprised of 158 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, our ability to continue to be strongly positioned in both the portable storage and specialty containment markets, including our ability to increase portable storage pricing, execute our salesforce model and development strategy, continue to increase our ISR headcount and drive topline growth, grow our downstream business at existing branches and through the utilization of our existing portable storage footprint, capitalize on our infrastructure and salesforce, and grow our free cash flow in 2017, 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.

Mobile Mini, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
(in thousands, except percentage and per share data)

	Three Months Ended December 31, 2016									Three Months Ended December 31, 2015
	Actual			Adjustments			Adjusted (1)			Actual			Adjustments			Adjusted (2)

Revenues:
Rental	$	124,170		$	—		$	124,170		$	126,540		$	—		$	126,540
Sales		6,656			—			6,656			7,188			—			7,188
Other		(439	)		1,146			707			789			(77	)		712
Total revenues		130,387			1,146			131,533			134,517			(77	)		134,440

Costs and expenses:
Rental, selling and general expenses		74,498			(807	)		73,691			78,443			(705	)		77,738
Cost of sales		4,285			—			4,285			4,772			—			4,772
Restructuring expenses		800			(800	)		—			16,025			(16,025	)		—
Depreciation and amortization		16,104			—			16,104			15,269			—			15,269
Total costs and expenses		95,687			(1,607	)		94,080			114,509			(16,730	)		97,779

Income from operations		34,700			2,753			37,453			20,008			16,653			36,661

Other expense:
Interest income		2			—			2			—			—			—
Interest expense		(8,193	)		—			(8,193	)		(8,914	)		—			(8,914	)
Deferred financing costs write-off		—			—			—			(931	)		931			—
Foreign currency exchange		(9	)		—			(9	)		—			—			—

Income before income tax provision		26,500			2,753			29,253			10,163			17,584			27,747

Income tax provision		7,031			1,040			8,071			658			8,652			9,310

Net income	$	19,469		$	1,713		$	21,182		$	9,505		$	8,932		$	18,437

EBITDA/Adjusted EBITDA	$	50,797					$	54,154		$	35,277					$	54,924
EBITDA/Adjusted EBITDA as a percentage of total revenues		39.0	%					41.2	%		26.2	%					40.9	%

Earnings per share:
Basic	$	0.44					$	0.48		$	0.21					$	0.42
Diluted		0.44						0.48			0.21						0.41

Weighted average number of common and common share equivalents outstanding:
Basic		44,073						44,073			44,383						44,383
Diluted		44,269						44,269			44,762						44,762

(1)		Adjusted column for the three months ended December 31, 2016 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the three-month period ended December 31, 2016 include the following, along with the related tax effects:
		-- Increase of other revenue by $1.1 million to exclude reversed revenue related to a sales tax remittance.
		-- Reduction of $0.3 million in rental, selling and general expenses to exclude fees and penalties associated with the sales tax remittance.
		-- Reduction of $0.1 million in rental, selling and general expenses for acquisition-related expenses.
		-- Reduction of $0.5 million in rental, selling and general expenses to exclude costs related to severance in conjunction with the departure of an executive.
		-- Exclusion of costs of $0.8 million related to the restructuring of our business operations.
(2)		Adjusted column for the three months ended December 31, 2015 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and the additional information regarding non-GAAP financial information following in this earnings release. The adjustments for the three-month period ended December, 2015 include the following, along with the related tax effects:
		-- Reduction of other revenue by $0.1 million to exclude transition services revenue associated with the divestiture of our North American wood mobile office business in May 2015.
		-- Reduction of $0.4 million in rental, selling and general expenses to exclude operating expenses associated with the provision of transition services for our North American wood mobile office
		business, including expenses related to wood mobile offices on our leased properties.
		-- Reduction of $0.3 million in rental, selling and general expenses for acquisition-related expenses.
		-- Exclusion of costs of $16.0 million related to the restructuring of our business operations.
		-- Exclusion of write-off of deferred financing costs related to our prior ABL Credit Agreement upon entering into our Amended and Restated ABL Credit Agreement in December 2015.
		-- Exclusion of $1.9 million in net tax benefit resulting from adjustments to our existing net deferred income tax liabilities in the U.K. upon the fourth quarter 2015 enactment of a future statutory rate
		reduction.

Mobile Mini, Inc.
Condensed Consolidated Statements of Operations
(Unaudited, except as indicated)
(in thousands, except percentage and per share data)

	Year Ended December 31, 2016									Year Ended December 31, 2015
	Actual			Adjustments			Adjusted (1)			Actual			Adjustments			Adjusted (1)
										(audited)
Revenues:
Rental	$	480,083		$	—		$	480,083		$	494,715		$	—		$	494,715
Sales		26,499			—			26,499			29,953			—			29,953
Other		2,040			(219	)		1,821			6,109			(4,173	)		1,936
Total revenues		508,622			(219	)		508,403			530,777			(4,173	)		526,604

Costs and expenses:
Rental, selling and general expenses		309,294			(807	)		308,487			326,252			(7,879	)		318,373
Cost of sales		16,471			—			16,471			19,671			—			19,671
Restructuring expenses		6,020			(6,020	)		—			20,798			(20,798	)		—
Asset impairment charge and loss on divestiture, net		—			—			—			66,128			(66,128	)		—
Depreciation and amortization		63,734			—			63,734			60,344			—			60,344
Total costs and expenses		395,519			(6,827	)		388,692			493,193			(94,805	)		398,388

Income from operations		113,103			6,608			119,711			37,584			90,632			128,216

Other expense:
Interest income		2			—			2			1			—			1
Interest expense		(32,726	)		—			(32,726	)		(35,900	)		—			(35,900	)
Debt extinguishment expense		(9,192	)		9,192			—			—			—			—
Deferred financing costs write-off		(2,271	)		2,271			—			(931	)		931			—
Foreign currency exchange		(18	)		—			(18	)		(2	)		—			(2	)

Income before income tax provision		68,898			18,071			86,969			752			91,563			92,315

Income tax provision (benefit)		21,650			6,932			28,582			(4,822	)		37,093			32,271

Net income	$	47,248		$	11,139		$	58,387		$	5,574		$	54,470		$	60,044

EBITDA/Adjusted EBITDA	$	176,821					$	190,376		$	97,927					$	200,836
EBITDA/Adjusted EBITDA as a percentage of total revenues		34.8	%					37.4	%		18.4	%					38.1	%

Earnings (loss) per share:
Basic	$	1.07					$	1.32		$	0.12					$	1.34
Diluted		1.06						1.32			0.12						1.32

Weighted average number of common and common share equivalents outstanding:
Basic		44,145						44,145			44,953						44,953
Diluted		44,390						44,390			45,460						45,460

(1)		Adjusted columns for the year ended December 31, 2016 and 2015 exclude certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation. See the non-GAAP reconciliations herein and additional information regarding these adjustments following in this earnings release.

Mobile Mini, Inc.
Operating Data
(Unaudited)


	2016			2015
As of December 31:
Stand-alone portable storage locations		125			133
Stand-alone specialty containment locations		19			19
Combined portable storage and specialty containment locations		14			7
Portable storage rental fleet units		211,300			205,200
Specialty containment rental fleet units		12,100			11,700

Average Unit Utilization:
Portable storage - three months ended December 31		75.2	%		74.0	%
Portable storage - year ended December 31		70.6	%		69.4	%
Specialty containment - three months ended December 31		60.5	%		64.4	%
Specialty containment - year ended December 31		61.8	%		68.0	%

Mobile Mini, Inc.
Business Segment Information - Adjusted (1)
(Unaudited)
(in thousands)

	Three Months Ended December 31, 2016									Three Months Ended December 31, 2015
	Portable Storage			Specialty Containment			Total			Portable Storage			Specialty Containment			Total

Revenues:
Rental	$	101,637		$	22,533		$	124,170		$	102,196		$	24,344		$	126,540
Sales		5,842			814			6,656			5,495			1,693			7,188
Other		737			(30	)		707			693			19			712
Total revenues		108,216			23,317			131,533			108,384			26,056			134,440

Costs and expenses:
Rental, selling and general expenses		56,937			16,754			73,691			62,505			15,233			77,738
Cost of sales		3,751			534			4,285			3,604			1,168			4,772
Depreciation and amortization		9,293			6,811			16,104			8,786			6,483			15,269
Total costs and expenses		69,981			24,099			94,080			74,895			22,884			97,779

Income from operations	$	38,235		$	(782	)	$	37,453		$	33,489		$	3,172		$	36,661

Adjusted EBITDA	$	48,081		$	6,073		$	54,154		$	45,217		$	9,707		$	54,924
Adjusted EBITDA Margin		44.4	%		26.0	%		41.2	%		41.7	%		37.3	%		40.9	%



	Year Ended December 31, 2016									Year Ended December 31, 2015
	Portable Storage			Specialty Containment			Total			Portable Storage			Specialty Containment			Total

Revenues:
Rental	$	387,145		$	92,938		$	480,083		$	395,091		$	99,624		$	494,715
Sales		21,576			4,923			26,499			22,387			7,566			29,953
Other		1,621			200			1,821			1,864			72			1,936
Total revenues		410,342			98,061			508,403			419,342			107,262			526,604

Costs and expenses:
Rental, selling and general expenses		244,729			63,758			308,487			255,914			62,459			318,373
Cost of sales		13,319			3,152			16,471			14,580			5,091			19,671
Depreciation and amortization		35,509			28,225			63,734			34,828			25,516			60,344
Total costs and expenses		293,557			95,135			388,692			305,322			93,066			398,388

Income from operations	$	116,785		$	2,926		$	119,711		$	114,020		$	14,196		$	128,216

Adjusted EBITDA	$	158,981		$	31,395		$	190,376		$	160,686		$	40,150		$	200,836
Adjusted EBITDA Margin		38.7	%		32.0	%		37.4	%		38.3	%		37.4	%		38.1	%

(1)		These tables present results by major business segment adjusted to exclude certain transactions that management believes are not indicative of our business. See additional information regarding non-GAAP financial information following in this earnings release.

Mobile Mini, Inc.
Condensed Consolidated Balance Sheets
(in thousands)


	December 31,
	2016			2015
	(unaudited)			(audited)
ASSETS
Cash and cash equivalents	$	4,137		$	1,613
Receivables, net		99,175			80,191
Inventories		15,412			15,596
Rental fleet, net		950,065			951,323
Property, plant and equipment, net		149,197			131,687
Other assets		14,930			16,766
Intangibles, net		68,420			73,212
Goodwill		703,558			706,387
Total assets	$	2,004,894		$	1,976,775

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable	$	27,388		$	29,086
Accrued liabilities		64,126			59,024
Lines of credit		641,160			667,708
Obligations under capital leases		50,704			38,274
Senior Notes, net		245,212			197,553
Deferred income taxes		240,690			219,601
Total liabilities		1,269,280			1,211,246

Stockholders' equity:
Common stock		493			491
Additional paid-in capital		592,071			584,447
Retained earnings		362,896			352,262
Accumulated other comprehensive loss		(81,047	)		(44,162	)
Treasury stock		(138,799	)		(127,509	)
Total stockholders' equity		735,614			765,529
Total liabilities and stockholders' equity	$	2,004,894		$	1,976,775

Mobile Mini, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)

	Year Ended December 31,
	2016			2015
	(unaudited)			(audited)
Cash flows from operating activities:
Net income	$	47,248		$	5,574
Adjustments to reconcile net income to net cash provided by operating activities:
Debt extinguishment expense		9,192			—
Deferred financing costs write-off		2,271			931
Asset impairment charge and loss on divestiture, net		—			66,128
Non-cash restructuring expense, excluding share-based compensation		—			12,411
Provision for doubtful accounts		6,162			3,705
Amortization of deferred financing costs		1,976			3,131
Amortization of long-term liabilities		116			101
Share-based compensation expense		7,399			13,827
Depreciation and amortization		63,734			60,344
Gain on sale of rental fleet		(5,472	)		(6,402	)
Loss on disposal of property, plant and equipment		1,285			2,188
Deferred income taxes		21,634			(5,629	)
Tax shortfall on equity award transactions		(242	)		(166	)
Foreign currency transaction loss		18			2
Changes in certain assets and liabilities, net of effect of businesses acquired		(19,077	)		(3,331	)
Net cash provided by operating activities		136,244			152,814

Cash flows from investing activities:
Proceeds from wood mobile office divestiture, net		—			83,280
Cash paid for businesses acquired, net of cash acquired		(16,565	)		(18,525	)
Additions to rental fleet, excluding acquisitions		(57,372	)		(74,732	)
Proceeds from sale of rental fleet		13,679			16,865
Additions to property, plant and equipment, excluding acquisitions		(30,659	)		(31,163	)
Proceeds from sale of property, plant and equipment		2,764			9,860
Net cash used in investing activities		(88,153	)		(14,415	)

Cash flows from financing activities:
Net repayments under lines of credit		(26,548	)		(37,810	)
Proceeds from issuance of 5.875% senior notes due 2024		250,000			—
Redemption of 7.875% senior notes due 2020		(200,000	)		—
Debt extinguishment expense		(9,192	)		—
Deferred financing costs		(5,369	)		(4,683	)
Principal payments on capital lease obligations		(6,520	)		(4,253	)
Issuance of common stock		468			1,703
Dividend payments		(36,402	)		(33,700	)
Purchase of treasury stock		(11,290	)		(61,833	)
Net cash used in financing activities		(44,853	)		(140,576	)

Effect of exchange rate changes on cash		(714	)		51

Net change in cash		2,524			(2,126	)

Cash and cash equivalents at beginning of period		1,613			3,739
Cash and cash equivalents at end of period	$	4,137		$	1,613

Equipment and other acquired through capital lease obligations	$	18,951		$	17,638
Capital expenditures accrued or payable		3,230			4,210

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, free cash flow and constant currency financial information 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:


Mobile Mini, Inc.
Adjusted Income Reconciliations (1)
For the Year Ended December 31, 2016
(Unaudited)
(In thousands, except per share data)

	Statement of Operations As Reported			Restructuring Expense (2)			Acquisition- Related Expenses (3)			Sales-tax Refund & Remittance (4)			Executive Severance (5)			Debt Expense and Deferred Costs Write-Off (6)		Statement of Operations Adjusted

Revenues:
Rental	$	480,083		$	—		$	—		$	—		$	—		$	—	$	480,083
Sales		26,499			—			—			—			—			—		26,499
Other		2,040			—			—			(219	)		—			—		1,821
Total revenues		508,622			—			—			(219	)		—			—		508,403

Costs and expenses:
Rental, selling and general expenses		309,294			—			(100	)		(253	)		(454	)		—		308,487
Cost of sales		16,471			—			—			—			—			—		16,471
Restructuring expenses		6,020			(6,020	)		—			—			—			—		—
Depreciation and amortization		63,734			—			—			—			—			—		63,734
Total costs and expenses		395,519			(6,020	)		(100	)		(253	)		(454	)		—		388,692

Income from operations		113,103			6,020			100			34			454			—		119,711

Other expense:
Interest income		2			—			—			—			—			—		2
Interest expense		(32,726	)		—			—			—			—			—		(32,726	)
Debt extinguishment expense		(9,192	)		—			—			—			—			9,192		—
Deferred financing costs write-off		(2,271	)		—			—			—			—			2,271		—
Foreign currency exchange		(18	)		—			—			—			—			—		(18	)

Income before income tax provision		68,898			6,020			100			34			454			11,463		86,969

Income tax provision		21,650			2,313			17			14			175			4,413		28,582

Net income	$	47,248		$	3,707		$	83		$	20		$	279		$	7,050	$	58,387

Diluted shares outstanding		44,390																	44,390

Earnings per share	$	1.06																$	1.32

(1)		Adjusted column for the year ended December 31, 2016 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation.
(2)		Exclusion of costs of $6.0 million related to the restructuring of our business operations.
(3)		Reduction of $0.1 million in rental, selling and general expenses for acquisition-related expenses.
(4)		Reduction of other revenue by $1.4 million to exclude revenue associated with a sales tax refund, net of a $1.1 million increase to other revenue to exclude reversed revenue related to a sales tax remittance, and reduction of $0.3 million in rental, selling and general expenses to exclude fees and penalties associated with the sales tax remittance.
(5)		Reduction of $0.5 million in rental, selling and general expenses to exclude costs related to severance in conjunction with the departure of an executive.
(6)		Exclusion of $9.2 million of debt extinguishment costs to redeem $200 million aggregate principal amount of our outstanding 7.875% senior notes due December 2020 (the “2020 Senior Notes”) and exclusion of $2.3 million of deferred financing costs that were written off in conjunction with the redemption of the 2020 Notes.


Mobile Mini, Inc.
Adjusted Income Reconciliations (1)
For the Year Ended December 31, 2015
(Unaudited)
(In thousands, except per share data)

	Statement of Operations As Reported			Restructuring Expense (2)			Acquisition- Related Expenses (3)			Loss on Impairment and Divestiture and Transition Services (4)			Sales Tax Refund and Unclaimed Property Settlement (5)			Deferred financing Costs Write-Off (6)		U.K. Enacted Tax Rate Change (7)			Statement of Operations Adjusted

Revenues:
Rental	$	494,715		$	—		$	—		$	—		$	—		$	—	$	—		$	494,715
Sales		29,953			—			—			—			—			—		—			29,953
Other		6,109			—			—			(2,997	)		(1,176	)		—		—			1,936
Total revenues		530,777			—			—			(2,997	)		(1,176	)		—		—			526,604

Costs and expenses:
Rental, selling and general expenses		326,252			—			(2,650	)		(4,357	)		(872	)		—		—			318,373
Cost of sales		19,671			—			—			—			—			—		—			19,671
Restructuring expenses		20,798			(20,798	)		—			—			—			—		—			—
Asset impairment charge and
loss on divestiture, net		66,128			—			—			(66,128	)		—			—		—			—
Depreciation and amortization		60,344			—			—			—			—			—		—			60,344
Total costs and expenses		493,193			(20,798	)		(2,650	)		(70,485	)		(872	)		—		—			398,388

Income from operations		37,584			20,798			2,650			67,488			(304	)		—		—			128,216

Other expense:
Interest income		1			—			—			—			—			—		—			1
Interest expense		(35,900	)		—			—			—			—			—		—			(35,900	)
Deferred financing costs write-off		(931	)		—			—			—			—			931		—			—
Foreign currency exchange		(2	)		—			—			—			—			—		—			(2	)

Income before income tax provision		752			20,798			2,650			67,488			(304	)		931		—			92,315

Income tax provision		(4,822	)		7,967			1,016			25,983			(117	)		358		1,886			32,271

Net income	$	5,574		$	12,831		$	1,634		$	41,505		$	(187	)	$	573	$	(1,886	)	$	60,044

Diluted shares outstanding		45,460																				45,460

Earnings per share	$	0.12																			$	1.32

(1)		Adjusted column for the year ended December 31, 2015 excludes certain transactions that management believes are not indicative of our business. Adjusted figures are a non-GAAP presentation.
(2)		Exclusion of costs of $20.8 million related to the restructuring of our business operations, primarily the integration and geographic expansion of ETS into the existing Mobile Mini infrastructure.
(3)		Reduction of $2.7 million in rental, selling and general expenses for acquisition-related expenses.
(4)		Exclusion of asset impairment and loss on divestiture associated with the divestiture of our North American wood mobile office business. The $3.0 million of other revenue and $4.4 million of rental, selling and general expenses relate to the provision of short-term transition services, including housing wood mobile office units on our leased properties.
(5)		Reduction of other revenue by $1.2 million to exclude revenue associated with a sales tax refund, and reduction of $0.9 million rental, selling and general expenses to exclude costs associated with the settlement of an unclaimed property liability with the state of Delaware.
(6)		Exclusion of the write-off of existing deferred financing costs related to our prior ABL credit Agreement upon entering into our Amended and Restated ABL Credit Agreement in December 2015.
(7)		Exclusion of the net tax benefit resulting from adjustments to our existing net deferred income tax liabilities in the U.K. upon the fourth quarter 2015 enactment of a future statutory rate reduction.

Mobile Mini, Inc.
Adjusted EBITDA GAAP Reconciliations
(Unaudited)
(in thousands, except percentage data)

	Three Months Ended December 31,						Year Ended December 31,
	2016			2015			2016			2015
Net income	$	19,469		$	9,505		$	47,248		$	5,574
Interest expense		8,193			8,914			32,726			35,900
Income tax provision (benefit)		7,031			658			21,650			(4,822	)
Depreciation and amortization		16,104			15,269			63,734			60,344
Debt extinguishment expense		—			—			9,192			—
Deferred financing costs write-off		—			931			2,271			931
EBITDA		50,797			35,277			176,821			97,927

Share-based compensation expense		604			2,994			6,947			12,277
Restructuring expenses		800			16,025			6,020			20,798
Acquisition-related expenses		100			257			100			2,650
Impairment and divestiture-related revenues and expenses, net		—			333			—			67,488
Sales tax refund and remittance, net		1,146			—			(219	)		(1,176	)
Other		707			38			707			872
Adjusted EBITDA	$	54,154		$	54,924		$	190,376		$	200,836


	Three Months Ended December 31,						Year Ended December 31,
	2016			2015			2016			2015
Net cash provided by operating activities	$	40,223		$	39,093		$	136,244		$	152,814
Interest paid		3,666			11,950			21,546			32,372
Income and franchise taxes paid		392			1,661			1,772			4,935
Share-based compensation expense, including restructuring expense		(878	)		(2,994	)		(7,399	)		(13,827	)
Asset impairment charge and loss on divestiture, net		—			—			—			(66,128	)
Non-cash restructuring expense					(12,411	)					(12,411	)
Gain on sale of rental fleet		1,244			1,206			5,472			6,402
Loss on disposal of property, plant and equipment		(196	)		(153	)		(1,285	)		(2,188	)
Changes in other assets and liabilities, net of effect of businesses acquired		6,346			(3,075	)		20,471			(4,042	)
EBITDA	$	50,797		$	35,277		$	176,821		$	97,927

Mobile Mini, Inc.
Free Cash Flow GAAP Reconciliation
(Unaudited)
(in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2016			2015			2016			2015
Net cash provided by operating activities	$	40,223		$	39,093		$	136,244		$	152,814

Additions to rental fleet, excluding acquisitions		(10,892	)		(21,192	)		(57,372	)		(74,732	)
Proceeds from sale of rental fleet		2,909			3,565			13,679			16,865
Additions to property, plant and equipment, excluding acquisitions		(4,909	)		(13,245	)		(30,659	)		(31,163	)
Proceeds from sale of property, plant and equipment		395			7,413			2,764			9,860
Net capital expenditures, excluding acquisitions		(12,497	)		(23,459	)		(71,588	)		(79,170	)

Free cash flow	$	27,726		$	15,634		$	64,656		$	73,644

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.

Constant Currency. We calculate the effect of currency fluctuations on current periods by translating the results for our business in the U.K. during the current period using the average exchange rates from the comparative period. We present constant currency information to provide useful information to assess our underlying business excluding the effect of material foreign currency rate fluctuations. Calculated in constant currency, our total rental revenues, and our portable storage rental revenues, for the three months ended December 31, 2016 were $4.0 million higher than when calculated in accordance with GAAP.

View source version on businesswire.com: http://www.businesswire.com/news/home/20170202005371/en/

Source: Mobile Mini, Inc.

Mobile Mini, Inc.
Mark Funk, 602-308-3879
Executive VP & Chief Financial Officer
www.mobilemini.com
or
Investor Relations Counsel:
The Equity Group Inc.
Fred Buonocore, 212-836-9607
or
Linda Latman, 212-836-9609

Press Release Details

Mobile Mini Reports Q4’16 Results and Announces 10% Increase in Dividend