Stericycle, Inc.SRCL reported first-quarter 2016 adjusted earnings of $ 1.11 per share compared with $1.15 per share in the year-ago quarter. The year-over-year decline in adjusted earnings was largely due to higher costs. Adjusted earnings missed the Zacks Consensus Estimate by 4 cents.
Stericycle Inc. (SRCL) Street EPS & Surprise Percent - Last 5 Quarters | FindTheCompany
GAAP earnings per share were 78 cents in the reported quarter versus 87 cents in the year-ago quarter. The decline in earnings, despite top-line growth, was primarily due to higher operating costs and selling, general and administrative expenses.
Revenues & Margins
Revenues in the reported quarter were approximately $874.2 million, up 31.8% year over year but in line with the Zacks Consensus Estimate of $874 million. The year-over-year increase in revenues was primarily attributable to accretive acquisitions, which contributed approximately $194.5 million.
Domestic revenues in the reported quarter were $649.7 million (up 37.6% year over year), of which domestic regulated waste and compliance services contributed $624.9 million and $24.8 million was attributable to recalls and returns. Domestic internal growth, excluding recalls and returns revenues, was up 5%. International revenues were $224.5 million in the reported quarter, up 17.5% year over year.
Gross profit (GAAP) in the reported quarter was $369.2 million, up 31.2% year over year. Gross margin was 42.2% versus 42.4% in the prior-year quarter. Non-GAAP gross profit was $369.4 million in the reported quarter versus $281.3 million in the year-ago quarter. Non-GAAP gross profit margin was 42.3% versus 42.4% in the year-ago quarter.
Financial Position
As of Mar 31, 2016, cash and cash equivalents were $45.7 million, down from $55.6 million as of Dec 31, 2015. Net cash from operating activities for the quarter was $156.9 million compared with $132.6 million in the year-ago period.
For the quarter, long-term debt (net of current portion) was $ 3,038.1 million compared with $ 3,052.6 million as of Dec 31, 2015. The debt-to-EBITDA ratio was 3.41x at quarter end. Stericycle had an unused borrowing capacity of $584 million under its revolving credit facility.
Stericycle reported capital expenditure of $34.2 million. During the quarter, the company repurchased 327,952 shares.
Updated Guidance
For 2016, Stericycle revised its earlier guidance provided in fourth-quarter 2015. Per its latest outlook, earnings per share are expected in the range of $4.90 to $5.05, down from $5.26-$5.33 per share expected earlier. The company expects revenues to be in the range of $3.6 billion to $3.66 billion, and free cash flow in the range of $435 million and $455 million (down from $460 million to $480 million earlier). Capital expenditure is projected to be in the range of $125 million to $135 million. Reduction in 2016 financial expectations is an impact of softer industrial hazardous waste volume, and higher costs associated with international operations, which might be major headwinds this year.
Stericycle currently has a Zacks Rank #4 (Sell). Some better-ranked stocks in the industry include Quest Resource Holding Corporation QRHC , Republic Services, Inc. RSG and Waste Management, Inc. WM . All three stocks carry a Zacks Rank #2 (Buy).
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
