Mobile Mini Reports Q1’13 Results

  Mobile Mini Reports Q1’13 Results

Business Wire

TEMPE, Ariz. -- May 6, 2013

Mobile Mini, Inc. (NASDAQ GS: MINI), the world’s leading supplier of portable
storage solutions, today reported actual and adjusted financial results for
the quarter ended March 31, 2013. Total revenues were $97.9 million and
leasing revenues were $85.1 million, compared with $88.8 million and $78.4
million, respectively, for the same period last year. The Company’s first
quarter adjusted net income was $12.3 million, or $0.27 per diluted share,
compared with $6.0 million, or $0.13, respectively, for the first quarter of
2012.

Adjusted EBITDA was $37.8 million for the first quarter of 2013, compared with
$31.0 million for the same period last year. Adjusted EBITDA margin was 38.6%
for the first quarter of 2013, compared with 35.0% in the first quarter of
2012. The increase in profitability and margin reflects stronger utilization,
higher yield including improved pricing, and leveraging of operating expenses.

First Quarter 2013 Highlights

  *Grew leasing revenues 8.4% year-over-year to $85.1 million, our highest
    first quarter level since the first quarter of 2009.
  *Improved yield 4.3% including an average rental rate increase of 1.6%
    versus the prior year.
  *Generated a 21.7% year-over-year increase in adjusted EBITDA.
  *Increased average fleet utilization to 60.2%, up 340 bps from the first
    quarter of 2012.
  *Delivered strong free cash flow of $26.1 million, after $0.5 million of
    net capex.

The Company posted its ninth consecutive quarter of comparable period growth
in leasing revenues. The increase in units on rent was driven by stronger
demand from both non-construction and construction end markets and resulted in
continued year-over-year improvement in utilization. Yield rose 4.3% to an
all-time first quarter high of $604. The nearly 22% gain in adjusted EBITDA
and 360 basis point improvement in adjusted EBITDA margin over the first
quarter of 2012 reflects stronger leasing volume and pricing coupled with
disciplined cost controls. Finally, the Company continued to strengthen its
financial position, generating positive free cash flow for the 21^st
consecutive quarter and reducing net debt by $30.9 million.

Erik Olsson, Mobile Mini’s President and Chief Executive Officer commented,
“The year started on a strong note. Looking ahead, we anticipate that we will
continue to generate comparable period growth in leasing revenues through the
balance of 2013 which, with our strong operating leverage, should translate
into year-over-year EBITDA margin expansion. We see additional opportunity to
increase our utilization as we more deeply penetrate our existing markets and
expand into new ones. We have a great team of dedicated people focused on
delivering outstanding service to our customers, and I am looking forward to
working with them as we take Mobile Mini into its next phase of growth.”

Adjusted EBITDA, EBITDA margin, adjusted EBITDA margin, adjusted net income,
and free cash flow are non-GAAP financial measures as defined by Securities
and Exchange Commission (“SEC”) rules. Reconciliations of these measurements
to the most directly comparable GAAP financial measures can be found later in
this release.

Conference Call

Mobile Mini will host a conference call today, Monday, May 6, 2013, 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 Investors
section and will be available in advance and after the call. We will also post
the reconciliation of non-GAAP financial measures used in the slide show to
the most directly comparable GAAP financial measures. 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.

Mobile Mini, Inc. is the world’s leading provider of portable storage
solutions through its total lease fleet of over 230,900 portable storage
containers and office units with 137 locations in the U.S., United Kingdom,
Canada and The Netherlands. Mobile Mini is included on the Russell 2000^® and
3000^® Indexes and the S&P Small Cap Index.

This news release contains forward-looking statements, particularly regarding
growth, ability to penetrate existing markets and enter new markets, increases
in operating leverage, increases in revenue and utilization, and EBITDA margin
expansion, 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 SEC filings. 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)

                                                
Mobile Mini, Inc. Condensed Consolidated Statements of Income
(Unaudited)/(in 000’s except per share data)/(includes effects of rounding)
                                                        
                      Three Months Ended                Three Months Ended
                      March 31,                         March 31,
                        2013          2013             2012           2012
Revenues:             Actual        Adjusted         Actual         Adjusted
                                       (1)                                (1)
  Leasing             $ 85,066         $ 85,066         $ 78,444          $ 78,444
  Sales                 12,462           12,462           9,805             9,805
  Other                413         413            501          501     
Total revenues         97,941      97,941         88,750       88,750  
Costs and
expenses:
  Cost of sales         8,684            8,684            5,898             5,898
  Leasing,
  selling and           53,133           53,133           53,587            53,493
  general
  expenses (2)
  Integration,
  merger and            375              -                496               -
  restructuring
  expenses (3)
  Depreciation
  and                  8,811       8,811          9,014        9,014   
  amortization
Total costs and        71,003      70,628         68,995       68,405  
expenses
Income from             26,938           27,313           19,755            20,345
operations
                                                                          
Other income
(expense):
  Interest              (7,551 )         (7,551 )         (10,617 )         (10,617 )
  expense
  Deferred
  financing             -                -                (692    )         -
  costs
  write-off (4)
  Foreign
  currency             (1     )     (1     )        (1      )     (1      )
  exchange
Income before
provision for           19,386           19,761           8,445             9,727
income taxes
Provision for          7,344       7,488          3,235        3,704   
income taxes
Net income            $ 12,042     $ 12,273        $ 5,210       $ 6,023   
                                                                          
Earnings per
share:
  Basic               $ 0.27       $ 0.27          $ 0.12        $ 0.14    
  Diluted             $ 0.26       $ 0.27          $ 0.12        $ 0.13    
                                                                          
Weighted
average number
of common and
common
share
equivalents
outstanding:
  Basic                45,247      45,247         44,489       44,489  
  Diluted              45,733      45,733         45,060       45,060  
                                                                          
EBITDA                $ 35,748     $ 37,759        $ 28,768      $ 31,027  
                                                                          

      This column represents a non-GAAP presentation even though some
(1)  individual line items presented, such as revenues, are identical under
      both GAAP and the adjusted presentations.
(2)   In 2012, the difference relates to acquisition activity costs that are
      excluded in the adjusted presentation.
      Integration, merger and restructuring expenses represent costs relating
(3)   primarily to the restructuring of our operations that are excluded in
      the adjusted presentation.
      In 2012, this represents a portion of deferred financing costs
      associated with our prior $850.0 million credit agreement which was
(4)   replaced with our $900.0 million credit agreement in February 2012.
      Deferred financing costs write-off is excluded in the adjusted
      presentation.

                                                                                
            Reconciliation of Adjusted Measurements to Actuals                        Reconciliation of Adjusted Measurements to Actuals
            Three Months Ended March 31, 2013                                         Three Months Ended March 31, 2012
            (in thousands except per share data)                                      (in thousands except per share data)
            (includes effects of rounding)                                          (includes effects of rounding)
                                                                                                                             Deferred  
                                        Integration,                                                 Integration,                  financing
            As           Share-based    merger and                       As           Share-based    merger and                    costs
            Adjusted     compensation   restructuring                    Adjusted     compensation   restructuring   Acquisition   write-off
            (1)         expense (2)   expenses (3)   Actual           (1)         expense (2)   expenses (3)   expenses     (5)        Actual
                                                                                                                     (4)
Revenues    $ 97,941     $  -           $   -           $ 97,941         $ 88,750     $  -           $   -           $  -          $ -         $ 88,750
EBITDA      $ 37,759     $  (1,636 )    $   (375   )    $ 35,748         $ 31,027     $  (1,669 )        (496  )     $  (94   )    $ -         $ 28,768
EBITDA        38.6   %      (1.7   )%       (0.4   )%     36.5   %         35.0   %      (1.9   )%       (0.6  )%       (0.1  )%   $ -           32.4   %
margin
Operating   $ 27,313     $  -           $   (375   )    $ 26,938         $ 20,345     $  -           $   (496  )     $  (94   )    $ -         $ 19,755
income
Operating
income        27.9   %      -               (0.4   )%     27.5   %         22.9   %      -               (0.6  )%       (0.1  )%     -           22.3   %
margin
Pre tax     $ 19,761     $  -           $   (375   )    $ 19,386         $ 9,727      $  -           $   (496  )     $  (94   )    $ (692  )   $ 8,445
income
Net         $ 12,273     $  -           $   (231   )    $ 12,042         $ 6,023      $  -           $   (329  )     $  (58   )    $ (426  )   $ 5,210
income
Diluted
earnings    $ 0.27       $  -           $   (0.01  )    $ 0.26           $ 0.13       $  -           $   -           $  -          $ (0.01 )   $ 0.12
per share
                                                                                                                                               

      This column represents a non-GAAP presentation even though some
(1)  individual line items presented, such as revenues, are identical under
      both GAAP and the adjusted presentations.
(2)   Represents non-cash share-based expense associated with the granting of
      equity instruments and is excluded in the adjusted presentation.
      Integration, merger and restructuring expenses represent costs relating
(3)   primarily to the restructuring of our operations that are excluded in
      the adjusted presentation.
(4)   Represents acquisition activity costs that are excluded in the adjusted
      presentation.
      Represents a portion of deferred financing costs associated with our
(5)   prior $850.0 million credit agreement which was replaced with our $900.0
      million credit agreement in February 2012. Deferred financing costs
      write-off is excluded in the adjusted presentation.

                                              
                                                  Three Months Ended March 31,
                                                    2013        2012   
                                                  (In thousands)
Reconciliation of EBITDA to net cash                            
provided
by operating activities:
EBITDA                                            $  35,748         $ 28,768
Interest paid                                        (2,392 )         (3,047 )
Income and franchise taxes paid                      (87    )         (41    )
Share-based compensation expense                     1,636            1,856
Gain on sale of lease fleet units                    (3,067 )         (3,114 )
Gain on disposal of property, plant and              (28    )         (13    )
equipment
Changes in certain assets and liabilities,
net of effect of business acquired:
Receivables                                          890              2,963
Inventories                                          (754   )         (1,302 )
Deposits and prepaid expenses                        (671   )         194
Other assets and intangibles                         96               (237   )
Accounts payable and accrued liabilities            (4,774 )     (7,180 )
Net cash provided by operating activities         $  26,597     $ 18,847 
                                                                    
                                                                    
Reconciliation of net income to EBITDA and
adjusted EBITDA:
Net income                                        $  12,042         $ 5,210
Interest expense                                     7,551            10,617
Provision for income taxes                           7,344            3,235
Depreciation and amortization                        8,811            9,014
Deferred financing costs write-off                  -           692    
EBITDA                                               35,748           28,768
Share-based compensation expense                     1,636            1,669
Integration, merger, and restructuring               375              496
expenses
Acquisition expenses                                -           94     
Adjusted EBITDA                                   $  37,759     $ 31,027 
                                                                    
                                                                    
Reconciliation of net cash provided by
operating
activities to free cash flow:
Net cash provided by operating activities         $  26,597         $ 18,847
                                                                    
Additions to lease fleet                             (6,327 )         (9,820 )
Proceeds from sale of lease fleet units              9,880            7,653
Additions to property, plant and equipment           (4,280 )         (2,959 )
Proceeds from sale of property, plant and           221         164    
equipment
Net capital expenditures, excluding                 (506   )     (4,962 )
acquisitions
                                                                
Free cash flow                                    $  26,091     $ 13,885 
                                                                    

                                                              
Mobile Mini, Inc.
Condensed Consolidated Balance Sheets
(in thousands except par value data)
(includes effects of rounding)
                                                                 
                                                 March 31,       December 31,
                                                   2013            2012
                                                 (unaudited)     (audited)
ASSETS
Cash                                             $ 1,500         $ 1,937
Receivables, net                                   48,750          50,644
Inventories                                        20,214          19,534
Lease fleet, net                                   1,017,008       1,031,589
Property, plant and equipment, net                 80,640          80,822
Deposits and prepaid expenses                      7,458           6,858
Other assets and intangibles, net                  16,644          17,868
Goodwill                                          514,209       518,308   
Total assets                                     $ 1,706,423    $ 1,727,560 
                                                                 
                                                                 
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable                                 $ 18,739        $ 18,287
Accrued liabilities                                56,895          58,485
Lines of credit                                    411,752         442,391
Notes payable                                      178             310
Obligations under capital leases                   547             642
Senior Notes                                       200,000         200,000
Deferred income taxes                             204,265       197,926   
Total liabilities                                 892,376       918,041   
                                                                 
Commitments and contingencies
                                                                 
Stockholders' equity:
Preferred stock: $.01 par value, 20,000
shares authorized,                                 -               -

none issued
Common stock; $.01 par value, 95,000 shares
authorized,

48,359 issued and 46,184 outstanding
at March 31, 2013 and 48,211 issued and
46,036                                             484             482

outstanding at December 31, 2012
Additional paid-in capital                         527,041         522,372
Retained earnings                                  355,824         343,782
Accumulated other comprehensive loss               (30,002   )     (17,817   )
Treasury stock, at cost, 2,175 shares             (39,300   )    (39,300   )
Total stockholders' equity                        814,047       809,519   
Total liabilities and stockholders' equity       $ 1,706,423    $ 1,727,560 
                                                                 


                                                  (In thousands)
                                                Three Months Ended March 31,
                                                  2013              2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                      $ 12,042           $  5,210
Adjustments to reconcile net income to net
cash
provided by operating activities:
Deferred financing costs write-off                -                   692
Provision for doubtful accounts                   389                 211
Amortization of deferred financing costs          703                 981
Amortization of debt issuance discount            -                   21
Amortization of long-term liabilities             45                  41
Share-based compensation expense                  1,636               1,856
Depreciation and amortization                     8,811               9,014
Gain on sale of lease fleet units                 (3,067)             (3,114)
Gain on disposal of property, plant and
                                                  (28)                (13)
equipment
Deferred income taxes                             7,256               3,235
Foreign currency transaction loss                 1                   1
Changes in certain assets and liabilities,
net of effect of business acquired:
Receivables                                       501                 2,752
Inventories                                       (754)               (1,302)
Deposits and prepaid expenses                     (671)               194
Other assets and intangibles                      96                  (237)
Accounts payable                                  881                 (243)
Accrued liabilities                               (1,244)             (452)
Net cash provided by operating activities         26,597              18,847
                                                                      
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for business acquired                   -                   (3,563)
Additions to lease fleet                          (6,327)             (9,820)
Proceeds from sale of lease fleet units           9,880               7,653
Additions to property, plant and equipment        (4,280)             (2,959)
Proceeds from sale of property, plant, and        221                 164
equipment
Net cash used in investing activities             (506)               (8,525)
                                                                      
CASH FLOWS FROM FINANCING ACTIVITIES:
Net repayments under lines of credit              (30,638)            (3,789)
Deferred financing costs                          -                   (7,418)
Principal payments on notes payable               (132)               (122)
Principal payments on capital lease               (95)                (264)
obligations
Issuance of common stock                          2,983               1,722
Net cash used in financing activities             (27,882)            (9,871)
                                                                      
Effect of exchange rate changes on cash           1,354               (1,274)
                                                                      
NET DECREASE IN CASH                              (437)               (823)
                                                                      
CASH AT BEGINNING OF PERIOD                       1,937               2,860
                                                                     
CASH AT END OF PERIOD                           $ 1,500            $  2,037
                                                                      

This news release includes the financial measures “EBITDA”, “adjusted EBITDA”,
“EBITDA margin”, “adjusted EBITDA margin”, “adjusted SG&A”, “adjusted net
income”, “adjusted diluted earnings per share” and “free cash flow.” These
measurements are deemed “non-GAAP financial measures” under rules of the SEC,
including Regulation G. This non-GAAP financial information may be determined
or calculated differently by other companies.

EBITDA is defined as net income before interest expense, income taxes,
depreciation and amortization, and if applicable, debt restructuring or
extinguishment costs, including any write-off of deferred financing costs. We
further adjust EBITDA to exclude non-cash share-based compensation expense and
to ignore the effect of what we consider transactions or events not related to
our core business to arrive at adjusted EBITDA. The GAAP financial measure
that is most directly comparable to EBITDA is net cash provided by operating
activities. EBITDA and adjusted EBITDA margins are calculated by dividing
consolidated EBITDA and adjusted EBITDA by total revenues. The GAAP financial
measure that is most directly comparable to EBITDA margin is operating margin,
which represents operating income divided by revenues. We present adjusted
EBITDA and adjusted EBITDA margin because we believe they provide useful
information regarding our ability to meet our future debt payment
requirements, capital expenditures and working capital requirements and they
provide an overall evaluation of our financial condition. We include adjusted
EBITDA in the earnings announcement to provide transparency to investors.
Adjusted EBITDA has certain limitations as an analytical tool and should not
be used as a substitute for net income, cash flows, or other consolidated
income or cash flow data prepared in accordance with GAAP or as a measure of
our profitability or our liquidity. EBITDA margin is presented along with the
operating margin so as not to imply that more emphasis should be placed on it
than the corresponding GAAP measure.

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. 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 GAAP financial measure. 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 the Company’s existing businesses, debt service
obligations and strategic acquisitions.

Adjusted SG&A, adjusted net income and adjusted diluted earnings per share
permit a comparative assessment of our SG&A expenses, net income and diluted
earnings per share by excluding certain one-time expenses and integration,
merger and restructuring expenses to make a more meaningful comparison of our
operating performance.

Earlier in this release we provided a reconciliation of these adjusted
measurements to actual results along with a reconciliation of EBITDA to net
cash provided by operating activities, net income to EBITDA and adjusted
EBITDA and net cash provided by operating activities to free cash flow.

Contact:

Mobile Mini, Inc.
Mark Funk, 480-477-0241
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
 
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