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(Mark One)
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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the Quarterly Period Ended March 31, 2017
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OR
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the Transition Period from to
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Commission file number 1-13045
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Delaware
(State or other Jurisdiction of
Incorporation or Organization)
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23-2588479
(I.R.S. Employer
Identification No.)
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Large accelerated filer
ý
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a
smaller reporting company)
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Smaller reporting company
o
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Emerging growth company
o
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Page
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December 31, 2016
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March 31, 2017
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||||
ASSETS
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Current Assets:
|
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Cash and cash equivalents
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$
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236,484
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$
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295,628
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Accounts receivable (less allowances of $44,290 and $40,690 as of December 31, 2016 and March 31, 2017, respectively)
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691,249
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721,030
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Prepaid expenses and other
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184,374
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181,979
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Total Current Assets
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1,112,107
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1,198,637
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Property, Plant and Equipment:
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Property, plant and equipment
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5,535,783
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5,662,272
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Less—Accumulated depreciation
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(2,452,457
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)
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(2,550,532
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)
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Property, Plant and Equipment, Net
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3,083,326
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3,111,740
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Other Assets, Net:
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Goodwill
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3,905,021
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3,957,058
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Customer relationships and customer inducements
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1,252,523
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1,276,929
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Other
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133,823
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127,770
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Total Other Assets, Net
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5,291,367
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5,361,757
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Total Assets
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$
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9,486,800
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$
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9,672,134
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LIABILITIES AND EQUITY
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Current Liabilities:
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Current portion of long-term debt
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$
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172,975
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$
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421,227
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Accounts payable
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222,197
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239,894
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Accrued expenses
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450,257
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533,647
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Deferred revenue
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201,128
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223,701
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Total Current Liabilities
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1,046,557
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1,418,469
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Long-term Debt, net of current portion
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6,078,206
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5,922,748
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Other Long-term Liabilities
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99,540
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86,583
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Deferred Rent
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119,834
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121,938
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Deferred Income Taxes
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151,295
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151,314
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Commitments and Contingencies (see Note 8)
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Redeemable Noncontrolling Interests
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54,697
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67,308
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Equity:
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Iron Mountain Incorporated Stockholders' Equity:
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Preferred stock (par value $0.01; authorized 10,000,000 shares; none issued and outstanding)
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—
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—
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Common stock (par value $0.01; authorized 400,000,000 shares; issued and outstanding 263,682,670 shares and 264,110,388 shares as of December 31, 2016 and March 31, 2017, respectively)
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2,636
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2,641
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Additional paid-in capital
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3,489,795
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3,491,936
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(Distributions in excess of earnings) Earnings in excess of distributions
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(1,343,311
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)
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(1,430,613
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)
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Accumulated other comprehensive items, net
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(212,573
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)
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(161,239
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)
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Total Iron Mountain Incorporated Stockholders' Equity
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1,936,547
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1,902,725
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Noncontrolling Interests
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124
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1,049
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Total Equity
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1,936,671
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1,903,774
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Total Liabilities and Equity
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$
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9,486,800
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$
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9,672,134
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Three Months Ended
March 31, |
||||||
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2016
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2017
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Revenues:
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Storage rental
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$
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461,211
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$
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572,279
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Service
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289,479
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366,597
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Total Revenues
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750,690
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938,876
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Operating Expenses:
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Cost of sales (excluding depreciation and amortization)
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326,105
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426,707
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Selling, general and administrative
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207,766
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240,166
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Depreciation and amortization
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87,204
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124,707
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(Gain) Loss on disposal/write-down of property, plant and equipment (excluding real estate), net
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(451
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)
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(459
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)
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Total Operating Expenses
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620,624
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791,121
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Operating Income (Loss)
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130,066
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147,755
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Interest Expense, Net (includes Interest Income of $1,287 and $2,293 for the three months ended March 31, 2016 and 2017, respectively)
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67,062
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86,055
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Other (Income) Expense, Net
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(11,937
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)
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(6,364
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)
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Income (Loss) from Continuing Operations Before Provision (Benefit) for Income Taxes
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74,941
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68,064
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Provision (Benefit) for Income Taxes
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11,900
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9,220
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Income (Loss) from Continuing Operations
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63,041
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58,844
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(Loss) Income from Discontinued Operations, Net of Tax
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—
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(337
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)
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Net Income (Loss)
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63,041
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58,507
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Less: Net Income (Loss) Attributable to Noncontrolling Interests
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267
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382
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Net Income (Loss) Attributable to Iron Mountain Incorporated
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$
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62,774
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$
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58,125
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Earnings (Losses) per Share—Basic:
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Income (Loss) from Continuing Operations
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$
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0.30
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$
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0.22
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Total Income (Loss) from Discontinued Operations, Net of Tax
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$
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—
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$
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—
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Net Income (Loss) Attributable to Iron Mountain Incorporated
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$
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0.30
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$
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0.22
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Earnings (Losses) per Share—Diluted:
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Income (Loss) from Continuing Operations
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$
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0.30
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$
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0.22
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Total Income (Loss) from Discontinued Operations, Net of Tax
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$
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—
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$
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—
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Net Income (Loss) Attributable to Iron Mountain Incorporated
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$
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0.30
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$
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0.22
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Weighted Average Common Shares Outstanding—Basic
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211,526
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263,855
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Weighted Average Common Shares Outstanding—Diluted
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212,471
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264,810
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Dividends Declared per Common Share
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$
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0.4853
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$
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0.5504
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Three Months Ended
March 31, |
||||||
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2016
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2017
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||||
Net Income (Loss)
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$
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63,041
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$
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58,507
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Other Comprehensive Income (Loss):
|
|
|
|
|
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Foreign Currency Translation Adjustments
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23,978
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50,784
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Market Value Adjustments for Securities
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(734
|
)
|
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—
|
|
||
Total Other Comprehensive Income (Loss)
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23,244
|
|
|
50,784
|
|
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Comprehensive Income (Loss)
|
86,285
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|
|
109,291
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|
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Comprehensive Income (Loss) Attributable to Noncontrolling Interests
|
754
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(168
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)
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Comprehensive Income (Loss) Attributable to Iron Mountain Incorporated
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$
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85,531
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$
|
109,459
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|
|
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|
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Iron Mountain Incorporated Stockholders' Equity
|
|
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|||||||||||||||||||||||
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|||||||||||||||
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Common Stock
|
|
Additional
Paid-in Capital
|
|
(Distributions in Excess of Earnings) Earnings in Excess of Distributions
|
|
|
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Noncontrolling
Interests
|
|
|
|
|||||||||||||||||
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Total
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|
Shares
|
|
Amounts
|
|
|
|
Accumulated
Other Comprehensive Items, Net |
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Redeemable Noncontrolling Interests
|
|||||||||||||||||||
Balance, December 31, 2015
|
$
|
528,607
|
|
|
211,340,296
|
|
|
$
|
2,113
|
|
|
$
|
1,623,863
|
|
|
$
|
(942,218
|
)
|
|
$
|
(174,917
|
)
|
|
$
|
19,766
|
|
|
|
$
|
—
|
|
Issuance of shares under employee stock purchase plan and option plans and stock-based compensation
|
5,114
|
|
|
552,458
|
|
|
6
|
|
|
5,108
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|||||||
Parent cash dividends declared
|
(103,088
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(103,088
|
)
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|||||||
Foreign currency translation adjustment
|
23,978
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,491
|
|
|
487
|
|
|
|
—
|
|
|||||||
Market value adjustments for securities
|
(734
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(734
|
)
|
|
—
|
|
|
|
—
|
|
|||||||
Net income (loss)
|
63,041
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
62,774
|
|
|
—
|
|
|
267
|
|
|
|
—
|
|
|||||||
Noncontrolling interests equity contributions
|
1,299
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,299
|
|
|
|
—
|
|
|||||||
Noncontrolling interests dividends
|
(579
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(579
|
)
|
|
|
—
|
|
|||||||
Purchase of noncontrolling interests
|
3,506
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,506
|
|
|
|
—
|
|
|||||||
Balance, March 31, 2016
|
$
|
521,144
|
|
|
211,892,754
|
|
|
$
|
2,119
|
|
|
$
|
1,628,971
|
|
|
$
|
(982,532
|
)
|
|
$
|
(152,160
|
)
|
|
$
|
24,746
|
|
|
|
$
|
—
|
|
|
|
|
Iron Mountain Incorporated Stockholders' Equity
|
|
|
|
|
|
|||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
|
|
Common Stock
|
|
Additional
Paid-in Capital
|
|
(Distributions in Excess of Earnings) Earnings in Excess of Distributions
|
|
|
|
Noncontrolling
Interests
|
|
|
|
|||||||||||||||||
|
Total
|
|
Shares
|
|
Amounts
|
|
|
|
Accumulated
Other Comprehensive Items, Net |
|
|
Redeemable Noncontrolling Interests
|
|||||||||||||||||||
Balance, December 31, 2016
|
$
|
1,936,671
|
|
|
263,682,670
|
|
|
$
|
2,636
|
|
|
$
|
3,489,795
|
|
|
$
|
(1,343,311
|
)
|
|
$
|
(212,573
|
)
|
|
$
|
124
|
|
|
|
$
|
54,697
|
|
Issuance of shares under employee stock purchase plan and option plans and stock-based compensation
|
2,453
|
|
|
427,718
|
|
|
5
|
|
|
2,448
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|||||||
Change in value of redeemable noncontrolling interests
|
(307
|
)
|
|
—
|
|
|
—
|
|
|
(307
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
307
|
|
|||||||
Parent cash dividends declared
|
(145,427
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(145,427
|
)
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|||||||
Foreign currency translation adjustment
|
51,405
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51,334
|
|
|
71
|
|
|
|
(621
|
)
|
|||||||
Net income (loss)
|
58,350
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
58,125
|
|
|
—
|
|
|
225
|
|
|
|
157
|
|
|||||||
Noncontrolling interests equity contributions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
13,230
|
|
|||||||
Noncontrolling interests dividends
|
(214
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(214
|
)
|
|
|
(462
|
)
|
|||||||
Purchase of noncontrolling interests
|
843
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
843
|
|
|
|
—
|
|
|||||||
Balance, March 31, 2017
|
$
|
1,903,774
|
|
|
264,110,388
|
|
|
$
|
2,641
|
|
|
$
|
3,491,936
|
|
|
$
|
(1,430,613
|
)
|
|
$
|
(161,239
|
)
|
|
$
|
1,049
|
|
|
|
$
|
67,308
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
||
Net income (loss)
|
$
|
63,041
|
|
|
$
|
58,507
|
|
Loss (Income) from discontinued operations
|
—
|
|
|
337
|
|
||
Adjustments to reconcile net income (loss) to cash flows from operating activities:
|
|
|
|
|
|
||
Depreciation
|
75,390
|
|
|
99,592
|
|
||
Amortization (includes amortization of deferred financing costs and discount of $2,749 and $3,907 for the three months ended March 31, 2016 and 2017, respectively)
|
14,563
|
|
|
29,022
|
|
||
Revenue reduction associated with amortization of permanent withdrawal fees
|
2,943
|
|
|
3,158
|
|
||
Stock-based compensation expense
|
6,885
|
|
|
6,549
|
|
||
(Benefit) Provision for deferred income taxes
|
(6,012
|
)
|
|
(7,386
|
)
|
||
(Gain) Loss on disposal/write-down of property, plant and equipment, net (including real estate)
|
(451
|
)
|
|
(459
|
)
|
||
Foreign currency transactions and other, net
|
(11,477
|
)
|
|
(786
|
)
|
||
Changes in Assets and Liabilities (exclusive of acquisitions):
|
|
|
|
|
|
||
Accounts receivable
|
(8,151
|
)
|
|
(8,971
|
)
|
||
Prepaid expenses and other
|
30,297
|
|
|
(24,826
|
)
|
||
Accounts payable
|
(30,934
|
)
|
|
5,869
|
|
||
Accrued expenses and deferred revenue
|
(55,494
|
)
|
|
(36,112
|
)
|
||
Other assets and long-term liabilities
|
518
|
|
|
(2,320
|
)
|
||
Cash Flows from Operating Activities - Continuing Operations
|
81,118
|
|
|
122,174
|
|
||
Cash Flows from Operating Activities - Discontinued Operations
|
—
|
|
|
(337
|
)
|
||
Cash Flows from Operating Activities
|
81,118
|
|
|
121,837
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||
Capital expenditures
|
(80,852
|
)
|
|
(73,202
|
)
|
||
Cash paid for acquisitions, net of cash acquired
|
(19,340
|
)
|
|
(12,187
|
)
|
||
Acquisition of customer relationships
|
(6,132
|
)
|
|
(17,132
|
)
|
||
Customer inducements
|
(1,126
|
)
|
|
(4,271
|
)
|
||
Net proceeds from Iron Mountain Divestments (see Note 10)
|
—
|
|
|
2,423
|
|
||
Proceeds from sales of property and equipment and other, net (including real estate)
|
169
|
|
|
66
|
|
||
Cash Flows from Investing Activities - Continuing Operations
|
(107,281
|
)
|
|
(104,303
|
)
|
||
Cash Flows from Investing Activities - Discontinued Operations
|
—
|
|
|
—
|
|
||
Cash Flows from Investing Activities
|
(107,281
|
)
|
|
(104,303
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||
Repayment of revolving credit and term loan facilities and other debt
|
(2,384,215
|
)
|
|
(2,682,348
|
)
|
||
Proceeds from revolving credit and term loan facilities and other debt
|
2,509,845
|
|
|
2,714,783
|
|
||
Debt financing and equity contribution from noncontrolling interests
|
1,299
|
|
|
13,230
|
|
||
Debt repayment and equity distribution to noncontrolling interests
|
(414
|
)
|
|
(2,562
|
)
|
||
Parent cash dividends
|
(104,931
|
)
|
|
(2,060
|
)
|
||
Net (payments) proceeds associated with employee stock-based awards
|
(1,975
|
)
|
|
(4,308
|
)
|
||
Excess tax (deficiency) benefits from stock-based compensation
|
(348
|
)
|
|
—
|
|
||
Payment of debt financing and stock issuance costs
|
—
|
|
|
(73
|
)
|
||
Cash Flows from Financing Activities - Continuing Operations
|
19,261
|
|
|
36,662
|
|
||
Cash Flows from Financing Activities - Discontinued Operations
|
—
|
|
|
—
|
|
||
Cash Flows from Financing Activities
|
19,261
|
|
|
36,662
|
|
||
Effect of Exchange Rates on Cash and Cash Equivalents
|
(3,534
|
)
|
|
4,948
|
|
||
(Decrease) Increase in Cash and Cash Equivalents
|
(10,436
|
)
|
|
59,144
|
|
||
Cash and Cash Equivalents, Beginning of Period
|
128,381
|
|
|
236,484
|
|
||
Cash and Cash Equivalents, End of Period
|
$
|
117,945
|
|
|
$
|
295,628
|
|
Supplemental Information:
|
|
|
|
|
|
||
Cash Paid for Interest
|
$
|
83,942
|
|
|
$
|
99,022
|
|
(Refund Received) Cash Paid for Income Taxes, Net
|
$
|
(3,211
|
)
|
|
$
|
30,422
|
|
Non-Cash Investing and Financing Activities:
|
|
|
|
|
|
||
Capital Leases
|
$
|
18,005
|
|
|
$
|
24,395
|
|
Accrued Capital Expenditures
|
$
|
42,205
|
|
|
$
|
63,655
|
|
Dividends Payable
|
$
|
3,736
|
|
|
$
|
148,992
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Total (gain) loss on foreign currency transactions
|
$
|
(12,542
|
)
|
|
$
|
(4,164
|
)
|
|
North American
Records and Information Management Business |
|
North American
Data Management Business |
|
Western
European Business
|
|
Other International Business
|
|
Corporate and Other Business
|
|
Total
Consolidated |
||||||||||||
Gross Balance as of December 31, 2016
|
$
|
2,485,806
|
|
|
$
|
559,443
|
|
|
$
|
405,571
|
|
|
$
|
743,126
|
|
|
$
|
25,922
|
|
|
$
|
4,219,868
|
|
Deductible goodwill acquired during the year
|
672
|
|
|
—
|
|
|
—
|
|
|
387
|
|
|
717
|
|
|
1,776
|
|
||||||
Non-deductible goodwill acquired during the year
|
—
|
|
|
—
|
|
|
—
|
|
|
4,311
|
|
|
—
|
|
|
4,311
|
|
||||||
Fair value and other adjustments(1)
|
5,548
|
|
|
525
|
|
|
2,818
|
|
|
2,802
|
|
|
—
|
|
|
11,693
|
|
||||||
Currency effects
|
1,569
|
|
|
448
|
|
|
4,649
|
|
|
27,801
|
|
|
—
|
|
|
34,467
|
|
||||||
Gross Balance as of March 31, 2017
|
$
|
2,493,595
|
|
|
$
|
560,416
|
|
|
$
|
413,038
|
|
|
$
|
778,427
|
|
|
$
|
26,639
|
|
|
$
|
4,272,115
|
|
Accumulated Amortization Balance as of December 31, 2016
|
$
|
204,895
|
|
|
$
|
53,753
|
|
|
$
|
56,150
|
|
|
$
|
49
|
|
|
$
|
—
|
|
|
$
|
314,847
|
|
Currency effects
|
58
|
|
|
15
|
|
|
125
|
|
|
12
|
|
|
—
|
|
|
210
|
|
||||||
Accumulated Amortization Balance as of March 31, 2017
|
$
|
204,953
|
|
|
$
|
53,768
|
|
|
$
|
56,275
|
|
|
$
|
61
|
|
|
$
|
—
|
|
|
$
|
315,057
|
|
Net Balance as of December 31, 2016
|
$
|
2,280,911
|
|
|
$
|
505,690
|
|
|
$
|
349,421
|
|
|
$
|
743,077
|
|
|
$
|
25,922
|
|
|
$
|
3,905,021
|
|
Net Balance as of March 31, 2017
|
$
|
2,288,642
|
|
|
$
|
506,648
|
|
|
$
|
356,763
|
|
|
$
|
778,366
|
|
|
$
|
26,639
|
|
|
$
|
3,957,058
|
|
Accumulated Goodwill Impairment Balance as of December 31, 2016
|
$
|
85,909
|
|
|
$
|
—
|
|
|
$
|
46,500
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
132,409
|
|
Accumulated Goodwill Impairment Balance as of March 31, 2017
|
$
|
85,909
|
|
|
$
|
—
|
|
|
$
|
46,500
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
132,409
|
|
(1)
|
Total fair value and other adjustments include
$11,693
in net adjustments primarily related to property, plant and equipment and customer relationship intangible assets (which represent adjustments within the applicable measurement period to provisional amounts recognized in purchase accounting).
|
|
December 31, 2016
|
|
March 31, 2017
|
||||||||||||||||||||
|
Gross Carrying
Amount |
|
Accumulated
Amortization |
|
Net Carrying
Amount |
|
Gross Carrying
Amount |
|
Accumulated
Amortization |
|
Net Carrying
Amount |
||||||||||||
Customer relationship intangible assets and Customer Inducements
|
$
|
1,604,020
|
|
|
$
|
(351,497
|
)
|
|
$
|
1,252,523
|
|
|
$
|
1,650,854
|
|
|
$
|
(373,925
|
)
|
|
$
|
1,276,929
|
|
Other finite-lived intangible assets (included in other assets, net)
|
24,788
|
|
|
(7,989
|
)
|
|
16,799
|
|
|
24,225
|
|
|
(10,478
|
)
|
|
13,747
|
|
||||||
Total
|
$
|
1,628,808
|
|
|
$
|
(359,486
|
)
|
|
$
|
1,269,322
|
|
|
$
|
1,675,079
|
|
|
$
|
(384,403
|
)
|
|
$
|
1,290,676
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Amortization expense associated with finite-lived intangible assets
|
$
|
11,814
|
|
|
$
|
25,115
|
|
Revenue reduction associated with amortization of Permanent Withdrawal Fees
|
2,943
|
|
|
3,158
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Cost of sales (excluding depreciation and amortization)
|
$
|
27
|
|
|
$
|
28
|
|
Selling, general and administrative expenses
|
6,858
|
|
|
6,521
|
|
||
Total stock-based compensation
|
$
|
6,885
|
|
|
$
|
6,549
|
|
|
March 31, 2017
|
||||
|
Stock Options Outstanding
|
|
% of
Stock Options Outstanding
|
||
Three-year vesting period (10 year contractual life)
|
3,597,671
|
|
|
83.4
|
%
|
Five-year vesting period (10 year contractual life)
|
626,204
|
|
|
14.5
|
%
|
Ten-year vesting period (12 year contractual life)
|
90,754
|
|
|
2.1
|
%
|
|
4,314,629
|
|
|
100.0
|
%
|
|
|
Three Months Ended
March 31, |
||||
Weighted Average Assumptions
|
|
2016
|
|
2017
|
||
Expected volatility
|
|
27.2
|
%
|
|
25.8
|
%
|
Risk-free interest rate
|
|
1.32
|
%
|
|
1.96
|
%
|
Expected dividend yield
|
|
7
|
%
|
|
6
|
%
|
Expected life
|
|
5.6 years
|
|
|
5.0 years
|
|
|
Stock Options
|
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Contractual Term (Years) |
|
Average
Intrinsic Value |
|||||
Outstanding at December 31, 2016
|
3,451,698
|
|
|
$
|
31.79
|
|
|
|
|
|
|
|
Granted
|
1,007,224
|
|
|
36.89
|
|
|
|
|
|
|
||
Exercised
|
(136,739
|
)
|
|
22.24
|
|
|
|
|
|
|
||
Forfeited
|
(5,773
|
)
|
|
28.21
|
|
|
|
|
|
|
||
Expired
|
(1,781
|
)
|
|
38.83
|
|
|
|
|
|
|
||
Outstanding at March 31, 2017
|
4,314,629
|
|
|
$
|
33.29
|
|
|
7.57
|
|
$
|
17,780
|
|
Options exercisable at March 31, 2017
|
2,126,229
|
|
|
$
|
30.09
|
|
|
5.84
|
|
$
|
15,685
|
|
Options expected to vest
|
2,022,212
|
|
|
$
|
36.41
|
|
|
9.24
|
|
$
|
1,955
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Aggregate intrinsic value of stock options exercised
|
$
|
1,433
|
|
|
$
|
1,912
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Cash dividends accrued on RSUs
|
$
|
631
|
|
|
$
|
683
|
|
Cash dividends paid on RSUs
|
1,635
|
|
|
1,855
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Fair value of RSUs vested
|
$
|
14,978
|
|
|
$
|
14,026
|
|
|
RSUs
|
|
Weighted-
Average Grant-Date Fair Value |
|||
Non-vested at December 31, 2016
|
1,163,393
|
|
|
$
|
33.21
|
|
Granted
|
525,328
|
|
|
36.90
|
|
|
Vested
|
(438,091
|
)
|
|
32.02
|
|
|
Forfeited
|
(11,597
|
)
|
|
34.65
|
|
|
Non-vested at March 31, 2017
|
1,239,033
|
|
|
$
|
35.18
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Cash dividends accrued on PUs
|
$
|
262
|
|
|
$
|
324
|
|
Cash dividends paid on PUs
|
645
|
|
|
205
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Fair value of earned PUs that vested
|
$
|
4,081
|
|
|
$
|
905
|
|
|
Original
PU Awards |
|
PU Adjustment(1)
|
|
Total
PU Awards |
|
Weighted-
Average Grant-Date Fair Value |
|||||
Non-vested at December 31, 2016
|
559,340
|
|
|
(121,038
|
)
|
|
438,302
|
|
|
$
|
33.67
|
|
Granted
|
229,692
|
|
|
—
|
|
|
229,692
|
|
|
41.93
|
|
|
Vested
|
(32,776
|
)
|
|
—
|
|
|
(32,776
|
)
|
|
27.60
|
|
|
Forfeited/Performance or Market Conditions Not Achieved
|
(3,480
|
)
|
|
(129,029
|
)
|
|
(132,509
|
)
|
|
28.57
|
|
|
Non-vested at March 31, 2017
|
752,776
|
|
|
(250,067
|
)
|
|
502,709
|
|
|
$
|
39.18
|
|
(1)
|
Represents an increase or decrease in the number of original PUs awarded based on either the final performance criteria or market condition achievement at the end of the performance period of such PUs or a change in estimated awards based on the forecasted performance against the predefined targets.
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Income (loss) from continuing operations
|
$
|
63,041
|
|
|
$
|
58,844
|
|
Less: Net income (loss) attributable to noncontrolling interests
|
267
|
|
|
382
|
|
||
Income (loss) from continuing operations (utilized in numerator of Earnings Per Share calculation)
|
$
|
62,774
|
|
|
$
|
58,462
|
|
(Loss) income from discontinued operations, net of tax
|
$
|
—
|
|
|
$
|
(337
|
)
|
Net income (loss) attributable to Iron Mountain Incorporated
|
$
|
62,774
|
|
|
$
|
58,125
|
|
|
|
|
|
||||
Weighted-average shares—basic
|
211,526,000
|
|
|
263,855,000
|
|
||
Effect of dilutive potential stock options
|
482,388
|
|
|
461,761
|
|
||
Effect of dilutive potential RSUs and PUs
|
463,053
|
|
|
492,905
|
|
||
Weighted-average shares—diluted
|
212,471,441
|
|
|
264,809,666
|
|
||
|
|
|
|
||||
Earnings (losses) per share—basic:
|
|
|
|
|
|
||
Income (loss) from continuing operations
|
$
|
0.30
|
|
|
$
|
0.22
|
|
(Loss) income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
||
Net income (loss) attributable to Iron Mountain Incorporated(1)
|
$
|
0.30
|
|
|
$
|
0.22
|
|
|
|
|
|
||||
Earnings (losses) per share—diluted:
|
|
|
|
|
|
||
Income (loss) from continuing operations
|
$
|
0.30
|
|
|
$
|
0.22
|
|
(Loss) income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
||
Net income (loss) attributable to Iron Mountain Incorporated(1)
|
$
|
0.30
|
|
|
$
|
0.22
|
|
|
|
|
|
||||
Antidilutive stock options, RSUs and PUs, excluded from the calculation
|
2,821,795
|
|
|
2,494,255
|
|
|
|
|
|
Fair Value Measurements at
December 31, 2016 Using |
||||||||||||||||
Description
|
|
Total Carrying
Value at
December 31,
2016
|
|
Quoted prices
in active
markets
(Level 1)
|
|
|
|
Significant other
observable
inputs
(Level 2)
|
|
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
Time Deposits(1)
|
|
$
|
22,240
|
|
|
$
|
—
|
|
|
|
|
$
|
22,240
|
|
|
|
|
$
|
—
|
|
Trading Securities
|
|
10,659
|
|
|
10,181
|
|
|
(2)
|
|
478
|
|
|
(1)
|
|
—
|
|
|
|
|
|
Fair Value Measurements at
March 31, 2017 Using |
||||||||||||||||
Description
|
|
Total Carrying
Value at
March 31,
2017
|
|
Quoted prices
in active
markets
(Level 1)
|
|
|
|
Significant other
observable
inputs
(Level 2)
|
|
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
Time Deposits(1)
|
|
$
|
25,739
|
|
|
$
|
—
|
|
|
|
|
$
|
25,739
|
|
|
|
|
$
|
—
|
|
Trading Securities
|
|
10,342
|
|
|
9,958
|
|
|
(2)
|
|
384
|
|
|
(1)
|
|
—
|
|
||||
Derivative Assets(3)
|
|
114
|
|
|
—
|
|
|
|
|
114
|
|
|
|
|
—
|
|
(1)
|
Time deposits and certain trading securities (included in Prepaid expenses and other in our Consolidated Balance Sheets) are measured based on quoted prices for similar assets and/or subsequent transactions.
|
(2)
|
Certain trading securities are measured at fair value using quoted market prices.
|
(3)
|
Derivative assets relate to short-term (six months or less) foreign currency contracts that we have entered into to hedge certain of our foreign exchange intercompany exposures, as more fully disclosed at Note 3. We calculate the value of such forward contracts by adjusting the spot rate utilized at the balance sheet date for translation purposes by an estimate of the forward points observed in active markets.
|
|
Foreign
Currency Translation Adjustments |
|
Market Value
Adjustments for Securities |
|
Total
|
||||||
Balance as of December 31, 2015
|
$
|
(175,651
|
)
|
|
$
|
734
|
|
|
$
|
(174,917
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||
Foreign currency translation adjustments
|
23,491
|
|
|
—
|
|
|
23,491
|
|
|||
Market value adjustments for securities
|
—
|
|
|
(734
|
)
|
|
(734
|
)
|
|||
Total other comprehensive income (loss)
|
23,491
|
|
|
(734
|
)
|
|
22,757
|
|
|||
Balance as of March 31, 2016
|
$
|
(152,160
|
)
|
|
$
|
—
|
|
|
$
|
(152,160
|
)
|
|
Foreign
Currency Translation Adjustments |
|
Market Value
Adjustments for Securities |
|
Total
|
||||||
Balance as of December 31, 2016
|
$
|
(212,573
|
)
|
|
$
|
—
|
|
|
$
|
(212,573
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|||
Foreign currency translation adjustments
|
51,334
|
|
|
—
|
|
|
51,334
|
|
|||
Market value adjustments for securities
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total other comprehensive income (loss)
|
51,334
|
|
|
—
|
|
|
51,334
|
|
|||
Balance as of March 31, 2017
|
$
|
(161,239
|
)
|
|
$
|
—
|
|
|
$
|
(161,239
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Foreign currency transaction (gains) losses, net
|
$
|
(12,542
|
)
|
|
$
|
(4,164
|
)
|
Other, net
|
605
|
|
|
(2,200
|
)
|
||
|
$
|
(11,937
|
)
|
|
$
|
(6,364
|
)
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2016
|
|
2017
|
||||
Foreign exchange (losses) gains
|
|
$
|
(1,342
|
)
|
|
$
|
(1,072
|
)
|
Less: Tax (benefit) expense on foreign exchange (losses) gains
|
|
—
|
|
|
—
|
|
||
Foreign exchange (losses) gains, net of tax
|
|
$
|
(1,342
|
)
|
|
$
|
(1,072
|
)
|
i.
|
United States
|
•
|
The Initial United States Divestments
|
•
|
The Seattle/Atlanta Divestments
|
ii.
|
Australia
|
•
|
The Australia Divestment Business
|
iii.
|
Canada
|
•
|
The Recall Canadian Divestments
|
•
|
The Iron Mountain Canadian Divestments
|
iv.
|
United Kingdom
|
•
|
The UK Divestments
|
|
Three Months Ended
March 31, 2016 |
||
Total Revenues
|
$
|
937,952
|
|
Income from Continuing Operations
|
$
|
58,058
|
|
Per Share Income from Continuing Operations - Basic
|
$
|
0.22
|
|
Per Share Income from Continuing Operations - Diluted
|
$
|
0.22
|
|
Cash Paid (gross of cash acquired)(1)
|
|
$
|
13,736
|
|
Fair Value of Noncontrolling Interests
|
|
843
|
|
|
Total Consideration
|
|
14,579
|
|
|
Fair Value of Identifiable Assets Acquired:
|
|
|
||
Cash
|
|
1,631
|
|
|
Accounts Receivable and Prepaid Expenses
|
|
1,771
|
|
|
Other Assets
|
|
692
|
|
|
Property, Plant and Equipment(2)
|
|
2,845
|
|
|
Customer Relationship Intangible Assets(3)
|
|
8,222
|
|
|
Accounts Payable, Accrued Expenses and Other Liabilities
|
|
(6,208
|
)
|
|
Deferred Income Taxes
|
|
(461
|
)
|
|
Total Fair Value of Identifiable Net Assets Acquired
|
|
8,492
|
|
|
Goodwill Initially Recorded(4)
|
|
$
|
6,087
|
|
(1)
|
Included in cash paid for acquisitions in the Consolidated Statement of Cash Flows for the
three
months ended
March 31, 2017
is net cash acquired of
$1,631
and contingent and other payments, net of
$82
related to acquisitions made in previous years.
|
(2)
|
Consists primarily of racking structures and warehouse equipment. These assets are depreciated using the straight-line method with the useful lives as noted in Note 2.f. to Notes to Consolidated Financial Statements included in our Annual Report.
|
(3)
|
The weighted average lives of customer relationship intangible assets associated with acquisitions in
2017
was
20
years.
|
(1)
|
Collectively, the "Parent Notes".
|
(2)
|
Collectively, the "Unregistered Notes".
|
(3)
|
Collectively, the "CAD Notes".
|
(4)
|
Because the Accounts Receivable Securitization Program terminates on March 6, 2018, at which point all obligations under the program become due, this debt is classified within the current portion of long-term debt in our Consolidated Balance Sheet as of March 31, 2017.
|
|
December 31, 2016
|
|
March 31, 2017
|
|
Maximum/Minimum Allowable
|
||
Net total lease adjusted leverage ratio
|
5.7
|
|
|
5.8
|
|
|
Maximum allowable of 6.5
|
Net secured debt lease adjusted leverage ratio
|
2.7
|
|
|
2.7
|
|
|
Maximum allowable of 4.0
|
Bond leverage ratio (not lease adjusted)
|
5.2
|
|
|
5.5
|
|
|
Maximum allowable of 6.5
|
Fixed charge coverage ratio
|
2.4
|
|
|
2.3
|
|
|
Minimum allowable of 1.5
|
|
December 31, 2016
|
||||||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Canada
Company |
|
Non-
Guarantors |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and Cash Equivalents:
|
$
|
2,405
|
|
|
$
|
23,380
|
|
|
$
|
17,110
|
|
|
$
|
193,589
|
|
|
$
|
—
|
|
|
$
|
236,484
|
|
Accounts receivable
|
—
|
|
|
53,364
|
|
|
37,781
|
|
|
600,104
|
|
|
—
|
|
|
691,249
|
|
||||||
Intercompany receivable
|
—
|
|
|
653,008
|
|
|
21,114
|
|
|
—
|
|
|
(674,122
|
)
|
|
—
|
|
||||||
Prepaid expenses and other
|
—
|
|
|
70,660
|
|
|
4,967
|
|
|
108,776
|
|
|
(29
|
)
|
|
184,374
|
|
||||||
Total Current Assets
|
2,405
|
|
|
800,412
|
|
|
80,972
|
|
|
902,469
|
|
|
(674,151
|
)
|
|
1,112,107
|
|
||||||
Property, Plant and Equipment, Net
|
483
|
|
|
1,804,991
|
|
|
159,391
|
|
|
1,118,461
|
|
|
—
|
|
|
3,083,326
|
|
||||||
Other Assets, Net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Long-term notes receivable from affiliates and intercompany receivable
|
4,014,330
|
|
|
1,000
|
|
|
—
|
|
|
—
|
|
|
(4,015,330
|
)
|
|
—
|
|
||||||
Investment in subsidiaries
|
1,659,518
|
|
|
699,411
|
|
|
35,504
|
|
|
77,449
|
|
|
(2,471,882
|
)
|
|
—
|
|
||||||
Goodwill
|
—
|
|
|
2,602,784
|
|
|
217,422
|
|
|
1,084,815
|
|
|
—
|
|
|
3,905,021
|
|
||||||
Other
|
—
|
|
|
765,698
|
|
|
49,570
|
|
|
571,078
|
|
|
—
|
|
|
1,386,346
|
|
||||||
Total Other Assets, Net
|
5,673,848
|
|
|
4,068,893
|
|
|
302,496
|
|
|
1,733,342
|
|
|
(6,487,212
|
)
|
|
5,291,367
|
|
||||||
Total Assets
|
$
|
5,676,736
|
|
|
$
|
6,674,296
|
|
|
$
|
542,859
|
|
|
$
|
3,754,272
|
|
|
$
|
(7,161,363
|
)
|
|
$
|
9,486,800
|
|
Liabilities and Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intercompany Payable
|
$
|
558,492
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
115,630
|
|
|
$
|
(674,122
|
)
|
|
$
|
—
|
|
Current Portion of Long-Term Debt
|
—
|
|
|
51,456
|
|
|
—
|
|
|
121,548
|
|
|
(29
|
)
|
|
172,975
|
|
||||||
Total Other Current Liabilities
|
58,478
|
|
|
488,194
|
|
|
40,442
|
|
|
286,468
|
|
|
—
|
|
|
873,582
|
|
||||||
Long-Term Debt, Net of Current Portion
|
3,093,388
|
|
|
1,055,642
|
|
|
335,410
|
|
|
1,593,766
|
|
|
—
|
|
|
6,078,206
|
|
||||||
Long-Term Notes Payable to Affiliates and Intercompany Payable
|
1,000
|
|
|
4,014,330
|
|
|
—
|
|
|
—
|
|
|
(4,015,330
|
)
|
|
—
|
|
||||||
Other Long-term Liabilities
|
—
|
|
|
127,715
|
|
|
54,054
|
|
|
188,900
|
|
|
—
|
|
|
370,669
|
|
||||||
Commitments and Contingencies (See Note 8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Redeemable Noncontrolling Interests
|
28,831
|
|
|
—
|
|
|
—
|
|
|
25,866
|
|
|
—
|
|
|
54,697
|
|
||||||
Total Iron Mountain Incorporated Stockholders' Equity
|
1,936,547
|
|
|
936,959
|
|
|
112,953
|
|
|
1,421,970
|
|
|
(2,471,882
|
)
|
|
1,936,547
|
|
||||||
Noncontrolling Interests
|
—
|
|
|
—
|
|
|
—
|
|
|
124
|
|
|
—
|
|
|
124
|
|
||||||
Total Equity
|
1,936,547
|
|
|
936,959
|
|
|
112,953
|
|
|
1,422,094
|
|
|
(2,471,882
|
)
|
|
1,936,671
|
|
||||||
Total Liabilities and Equity
|
$
|
5,676,736
|
|
|
$
|
6,674,296
|
|
|
$
|
542,859
|
|
|
$
|
3,754,272
|
|
|
$
|
(7,161,363
|
)
|
|
$
|
9,486,800
|
|
|
March 31, 2017
|
||||||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Canada
Company |
|
Non-
Guarantors |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and cash equivalents(1)
|
$
|
470
|
|
|
$
|
64,550
|
|
|
$
|
5,763
|
|
|
$
|
410,667
|
|
|
$
|
(185,822
|
)
|
|
$
|
295,628
|
|
Accounts receivable
|
—
|
|
|
36,545
|
|
|
36,215
|
|
|
648,270
|
|
|
—
|
|
|
721,030
|
|
||||||
Intercompany receivable
|
—
|
|
|
904,316
|
|
|
33,923
|
|
|
—
|
|
|
(938,239
|
)
|
|
—
|
|
||||||
Prepaid expenses and other
|
114
|
|
|
79,337
|
|
|
6,325
|
|
|
96,232
|
|
|
(29
|
)
|
|
181,979
|
|
||||||
Total Current Assets
|
584
|
|
|
1,084,748
|
|
|
82,226
|
|
|
1,155,169
|
|
|
(1,124,090
|
)
|
|
1,198,637
|
|
||||||
Property, Plant and Equipment, Net
|
438
|
|
|
1,810,787
|
|
|
157,814
|
|
|
1,142,701
|
|
|
—
|
|
|
3,111,740
|
|
||||||
Other Assets, Net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Long-term notes receivable from affiliates and intercompany receivable
|
4,214,179
|
|
|
1,000
|
|
|
—
|
|
|
—
|
|
|
(4,215,179
|
)
|
|
—
|
|
||||||
Investment in subsidiaries
|
1,750,210
|
|
|
785,770
|
|
|
35,948
|
|
|
85,456
|
|
|
(2,657,384
|
)
|
|
—
|
|
||||||
Goodwill
|
—
|
|
|
2,584,712
|
|
|
217,837
|
|
|
1,154,509
|
|
|
—
|
|
|
3,957,058
|
|
||||||
Other
|
—
|
|
|
762,098
|
|
|
49,211
|
|
|
593,390
|
|
|
—
|
|
|
1,404,699
|
|
||||||
Total Other Assets, Net
|
5,964,389
|
|
|
4,133,580
|
|
|
302,996
|
|
|
1,833,355
|
|
|
(6,872,563
|
)
|
|
5,361,757
|
|
||||||
Total Assets
|
$
|
5,965,411
|
|
|
$
|
7,029,115
|
|
|
$
|
543,036
|
|
|
$
|
4,131,225
|
|
|
$
|
(7,996,653
|
)
|
|
$
|
9,672,134
|
|
Liabilities and Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intercompany Payable
|
$
|
698,066
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
240,173
|
|
|
$
|
(938,239
|
)
|
|
$
|
—
|
|
Borrowings under cash pools
|
—
|
|
|
138,693
|
|
|
—
|
|
|
47,129
|
|
|
(185,822
|
)
|
|
—
|
|
||||||
Current Portion of Long-Term Debt
|
—
|
|
|
45,837
|
|
|
—
|
|
|
375,419
|
|
|
(29
|
)
|
|
421,227
|
|
||||||
Total Other Current Liabilities
|
199,038
|
|
|
454,823
|
|
|
41,747
|
|
|
301,634
|
|
|
—
|
|
|
997,242
|
|
||||||
Long-Term Debt, Net of Current Portion
|
3,159,864
|
|
|
1,014,038
|
|
|
338,456
|
|
|
1,410,390
|
|
|
—
|
|
|
5,922,748
|
|
||||||
Long-Term Notes Payable to Affiliates and Intercompany Payable
|
1,000
|
|
|
4,214,179
|
|
|
—
|
|
|
—
|
|
|
(4,215,179
|
)
|
|
—
|
|
||||||
Other Long-term Liabilities
|
—
|
|
|
138,228
|
|
|
41,429
|
|
|
180,178
|
|
|
—
|
|
|
359,835
|
|
||||||
Commitments and Contingencies (See Note 8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Redeemable Noncontrolling Interests
|
4,718
|
|
|
—
|
|
|
—
|
|
|
62,590
|
|
|
—
|
|
|
67,308
|
|
||||||
Total Iron Mountain Incorporated Stockholders' Equity
|
1,902,725
|
|
|
1,023,317
|
|
|
121,404
|
|
|
1,512,663
|
|
|
(2,657,384
|
)
|
|
1,902,725
|
|
||||||
Noncontrolling Interests
|
—
|
|
|
—
|
|
|
—
|
|
|
1,049
|
|
|
—
|
|
|
1,049
|
|
||||||
Total Equity
|
1,902,725
|
|
|
1,023,317
|
|
|
121,404
|
|
|
1,513,712
|
|
|
(2,657,384
|
)
|
|
1,903,774
|
|
||||||
Total Liabilities and Equity
|
$
|
5,965,411
|
|
|
$
|
7,029,115
|
|
|
$
|
543,036
|
|
|
$
|
4,131,225
|
|
|
$
|
(7,996,653
|
)
|
|
$
|
9,672,134
|
|
(1)
|
Included within Cash and Cash Equivalents at March 31, 2017 is approximately
$58,200
and
$144,100
of cash on deposit associated with our Cash Pools for the Guarantor and Non-Guarantors, respectively. See Note 5 for more information on our Cash Pools.
|
|
Three Months Ended March 31, 2016
|
||||||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Canada
Company |
|
Non-
Guarantors |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Storage rental
|
$
|
—
|
|
|
$
|
313,619
|
|
|
$
|
27,605
|
|
|
$
|
119,987
|
|
|
$
|
—
|
|
|
$
|
461,211
|
|
Service
|
—
|
|
|
188,908
|
|
|
14,642
|
|
|
85,929
|
|
|
—
|
|
|
289,479
|
|
||||||
Intercompany revenues
|
—
|
|
|
1,013
|
|
|
—
|
|
|
17,345
|
|
|
(18,358
|
)
|
|
—
|
|
||||||
Total Revenues
|
—
|
|
|
503,540
|
|
|
42,247
|
|
|
223,261
|
|
|
(18,358
|
)
|
|
750,690
|
|
||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of sales (excluding depreciation and amortization)
|
—
|
|
|
208,154
|
|
|
6,790
|
|
|
111,161
|
|
|
—
|
|
|
326,105
|
|
||||||
Selling, general and administrative
|
72
|
|
|
150,019
|
|
|
3,373
|
|
|
54,302
|
|
|
—
|
|
|
207,766
|
|
||||||
Intercompany cost of sales
|
—
|
|
|
3,354
|
|
|
13,991
|
|
|
1,013
|
|
|
(18,358
|
)
|
|
—
|
|
||||||
Depreciation and amortization
|
45
|
|
|
56,926
|
|
|
3,079
|
|
|
27,154
|
|
|
—
|
|
|
87,204
|
|
||||||
(Gain) Loss on disposal/write-down of property, plant and equipment (excluding real estate), net
|
—
|
|
|
(570
|
)
|
|
6
|
|
|
113
|
|
|
—
|
|
|
(451
|
)
|
||||||
Total Operating Expenses
|
117
|
|
|
417,883
|
|
|
27,239
|
|
|
193,743
|
|
|
(18,358
|
)
|
|
620,624
|
|
||||||
Operating (Loss) Income
|
(117
|
)
|
|
85,657
|
|
|
15,008
|
|
|
29,518
|
|
|
—
|
|
|
130,066
|
|
||||||
Interest Expense (Income), Net
|
39,984
|
|
|
(8,509
|
)
|
|
10,034
|
|
|
25,553
|
|
|
—
|
|
|
67,062
|
|
||||||
Other Expense (Income), Net
|
886
|
|
|
3,456
|
|
|
(20
|
)
|
|
(16,259
|
)
|
|
—
|
|
|
(11,937
|
)
|
||||||
(Loss) Income from Continuing Operations Before Provision (Benefit) for Income Taxes
|
(40,987
|
)
|
|
90,710
|
|
|
4,994
|
|
|
20,224
|
|
|
—
|
|
|
74,941
|
|
||||||
Provision (Benefit) for Income Taxes
|
—
|
|
|
9,070
|
|
|
1,866
|
|
|
964
|
|
|
—
|
|
|
11,900
|
|
||||||
Equity in the (Earnings) Losses of Subsidiaries, Net of Tax
|
(103,761
|
)
|
|
(22,374
|
)
|
|
(1,371
|
)
|
|
(3,128
|
)
|
|
130,634
|
|
|
—
|
|
||||||
Net Income (Loss)
|
62,774
|
|
|
104,014
|
|
|
4,499
|
|
|
22,388
|
|
|
(130,634
|
)
|
|
63,041
|
|
||||||
Less: Net Income (Loss) Attributable to Noncontrolling Interests
|
—
|
|
|
—
|
|
|
—
|
|
|
267
|
|
|
—
|
|
|
267
|
|
||||||
Net Income (Loss) Attributable to Iron Mountain Incorporated
|
$
|
62,774
|
|
|
$
|
104,014
|
|
|
$
|
4,499
|
|
|
$
|
22,121
|
|
|
$
|
(130,634
|
)
|
|
$
|
62,774
|
|
Net Income (Loss)
|
$
|
62,774
|
|
|
$
|
104,014
|
|
|
$
|
4,499
|
|
|
$
|
22,388
|
|
|
$
|
(130,634
|
)
|
|
$
|
63,041
|
|
Other Comprehensive Income (Loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign Currency Translation Adjustments
|
(1,342
|
)
|
|
—
|
|
|
1,789
|
|
|
23,531
|
|
|
—
|
|
|
23,978
|
|
||||||
Market Value Adjustments for Securities
|
—
|
|
|
(734
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(734
|
)
|
||||||
Equity in Other Comprehensive Income (Loss) of Subsidiaries
|
24,099
|
|
|
24,099
|
|
|
661
|
|
|
1,789
|
|
|
(50,648
|
)
|
|
—
|
|
||||||
Total Other Comprehensive Income (Loss)
|
22,757
|
|
|
23,365
|
|
|
2,450
|
|
|
25,320
|
|
|
(50,648
|
)
|
|
23,244
|
|
||||||
Comprehensive Income (Loss)
|
85,531
|
|
|
127,379
|
|
|
6,949
|
|
|
47,708
|
|
|
(181,282
|
)
|
|
86,285
|
|
||||||
Comprehensive Income (Loss) Attributable to Noncontrolling Interests
|
—
|
|
|
—
|
|
|
—
|
|
|
754
|
|
|
—
|
|
|
754
|
|
||||||
Comprehensive Income (Loss) Attributable to Iron Mountain Incorporated
|
$
|
85,531
|
|
|
$
|
127,379
|
|
|
$
|
6,949
|
|
|
$
|
46,954
|
|
|
$
|
(181,282
|
)
|
|
$
|
85,531
|
|
|
Three Months Ended March 31, 2017
|
||||||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Canada
Company |
|
Non-
Guarantors |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Storage rental
|
$
|
—
|
|
|
$
|
349,351
|
|
|
$
|
32,006
|
|
|
$
|
190,922
|
|
|
$
|
—
|
|
|
$
|
572,279
|
|
Service
|
—
|
|
|
218,209
|
|
|
16,050
|
|
|
132,338
|
|
|
—
|
|
|
366,597
|
|
||||||
Intercompany revenues
|
—
|
|
|
1,097
|
|
|
—
|
|
|
22,342
|
|
|
(23,439
|
)
|
|
—
|
|
||||||
Total Revenues
|
—
|
|
|
568,657
|
|
|
48,056
|
|
|
345,602
|
|
|
(23,439
|
)
|
|
938,876
|
|
||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of sales (excluding depreciation and amortization)
|
—
|
|
|
239,329
|
|
|
7,550
|
|
|
179,828
|
|
|
—
|
|
|
426,707
|
|
||||||
Selling, general and administrative
|
79
|
|
|
162,705
|
|
|
3,561
|
|
|
73,821
|
|
|
—
|
|
|
240,166
|
|
||||||
Intercompany cost of sales
|
—
|
|
|
6,606
|
|
|
15,736
|
|
|
1,097
|
|
|
(23,439
|
)
|
|
—
|
|
||||||
Depreciation and amortization
|
46
|
|
|
76,161
|
|
|
4,238
|
|
|
44,262
|
|
|
—
|
|
|
124,707
|
|
||||||
(Gain) Loss on disposal/write-down of property, plant and equipment (excluding real estate), net
|
—
|
|
|
(548
|
)
|
|
2
|
|
|
87
|
|
|
—
|
|
|
(459
|
)
|
||||||
Total Operating Expenses
|
125
|
|
|
484,253
|
|
|
31,087
|
|
|
299,095
|
|
|
(23,439
|
)
|
|
791,121
|
|
||||||
Operating (Loss) Income
|
(125
|
)
|
|
84,404
|
|
|
16,969
|
|
|
46,507
|
|
|
—
|
|
|
147,755
|
|
||||||
Interest Expense (Income), Net
|
42,784
|
|
|
(3,279
|
)
|
|
11,670
|
|
|
34,880
|
|
|
—
|
|
|
86,055
|
|
||||||
Other Expense (Income), Net
|
81
|
|
|
2,519
|
|
|
(27
|
)
|
|
(8,937
|
)
|
|
—
|
|
|
(6,364
|
)
|
||||||
(Loss) Income from Continuing Operations Before Provision (Benefit) for Income Taxes
|
(42,990
|
)
|
|
85,164
|
|
|
5,326
|
|
|
20,564
|
|
|
—
|
|
|
68,064
|
|
||||||
Provision (Benefit) for Income Taxes
|
—
|
|
|
12,744
|
|
|
(3,488
|
)
|
|
(36
|
)
|
|
—
|
|
|
9,220
|
|
||||||
Equity in the (Earnings) Losses of Subsidiaries, Net of Tax
|
(101,115
|
)
|
|
(23,413
|
)
|
|
(157
|
)
|
|
(8,814
|
)
|
|
133,499
|
|
|
—
|
|
||||||
Income (Loss) from Continuing Operations
|
58,125
|
|
|
95,833
|
|
|
8,971
|
|
|
29,414
|
|
|
(133,499
|
)
|
|
58,844
|
|
||||||
Income (Loss) from Discontinued Operations, Net of Tax
|
—
|
|
|
198
|
|
|
—
|
|
|
(535
|
)
|
|
—
|
|
|
(337
|
)
|
||||||
Net Income (Loss)
|
58,125
|
|
|
96,031
|
|
|
8,971
|
|
|
28,879
|
|
|
(133,499
|
)
|
|
58,507
|
|
||||||
Less: Net Income (Loss) Attributable to Noncontrolling Interests
|
—
|
|
|
—
|
|
|
—
|
|
|
382
|
|
|
—
|
|
|
382
|
|
||||||
Net Income (Loss) Attributable to Iron Mountain Incorporated
|
$
|
58,125
|
|
|
$
|
96,031
|
|
|
$
|
8,971
|
|
|
$
|
28,497
|
|
|
$
|
(133,499
|
)
|
|
$
|
58,125
|
|
Net Income (Loss)
|
$
|
58,125
|
|
|
$
|
96,031
|
|
|
$
|
8,971
|
|
|
$
|
28,879
|
|
|
$
|
(133,499
|
)
|
|
$
|
58,507
|
|
Other Comprehensive Income (Loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign Currency Translation Adjustments
|
(1,072
|
)
|
|
—
|
|
|
635
|
|
|
51,221
|
|
|
—
|
|
|
50,784
|
|
||||||
Equity in Other Comprehensive Income (Loss) of Subsidiaries
|
52,406
|
|
|
28,540
|
|
|
287
|
|
|
635
|
|
|
(81,868
|
)
|
|
—
|
|
||||||
Total Other Comprehensive Income (Loss)
|
51,334
|
|
|
28,540
|
|
|
922
|
|
|
51,856
|
|
|
(81,868
|
)
|
|
50,784
|
|
||||||
Comprehensive Income (Loss)
|
109,459
|
|
|
124,571
|
|
|
9,893
|
|
|
80,735
|
|
|
(215,367
|
)
|
|
109,291
|
|
||||||
Comprehensive (Loss) Income Attributable to Noncontrolling Interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(168
|
)
|
|
—
|
|
|
(168
|
)
|
||||||
Comprehensive Income (Loss) Attributable to Iron Mountain Incorporated
|
$
|
109,459
|
|
|
$
|
124,571
|
|
|
$
|
9,893
|
|
|
$
|
80,903
|
|
|
$
|
(215,367
|
)
|
|
$
|
109,459
|
|
|
|
|
Three Months Ended March 31, 2016
|
||||||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Canada
Company |
|
Non-
Guarantors |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash Flows from Operating Activities
|
$
|
(48,737
|
)
|
|
$
|
121,636
|
|
|
$
|
6,477
|
|
|
$
|
1,742
|
|
|
$
|
—
|
|
|
$
|
81,118
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Capital expenditures
|
—
|
|
|
(61,886
|
)
|
|
(1,007
|
)
|
|
(17,959
|
)
|
|
—
|
|
|
(80,852
|
)
|
||||||
Cash paid for acquisitions, net of cash acquired
|
—
|
|
|
—
|
|
|
130
|
|
|
(19,470
|
)
|
|
—
|
|
|
(19,340
|
)
|
||||||
Intercompany loans to subsidiaries
|
166,442
|
|
|
31,987
|
|
|
—
|
|
|
—
|
|
|
(198,429
|
)
|
|
—
|
|
||||||
Investment in subsidiaries
|
(1,585
|
)
|
|
(1,585
|
)
|
|
—
|
|
|
—
|
|
|
3,170
|
|
|
—
|
|
||||||
Acquisitions of customer relationships and customer inducements
|
—
|
|
|
(4,733
|
)
|
|
—
|
|
|
(2,525
|
)
|
|
—
|
|
|
(7,258
|
)
|
||||||
Proceeds from sales of property and equipment and other, net (including real estate)
|
—
|
|
|
50
|
|
|
—
|
|
|
119
|
|
|
—
|
|
|
169
|
|
||||||
Cash Flows from Investing Activities
|
164,857
|
|
|
(36,167
|
)
|
|
(877
|
)
|
|
(39,835
|
)
|
|
(195,259
|
)
|
|
(107,281
|
)
|
||||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Repayment of revolving credit and term loan facilities and other debt
|
(8,463
|
)
|
|
(1,422,545
|
)
|
|
(383,896
|
)
|
|
(569,311
|
)
|
|
—
|
|
|
(2,384,215
|
)
|
||||||
Proceeds from revolving credit and term loan facilities and other debt
|
—
|
|
|
1,500,499
|
|
|
370,816
|
|
|
638,530
|
|
|
—
|
|
|
2,509,845
|
|
||||||
Debt financing from (repayment to) and equity contribution from (distribution to) noncontrolling interests, net
|
—
|
|
|
—
|
|
|
—
|
|
|
885
|
|
|
—
|
|
|
885
|
|
||||||
Intercompany loans from parent
|
—
|
|
|
(167,514
|
)
|
|
(1,111
|
)
|
|
(29,804
|
)
|
|
198,429
|
|
|
—
|
|
||||||
Equity contribution from parent
|
—
|
|
|
1,585
|
|
|
—
|
|
|
1,585
|
|
|
(3,170
|
)
|
|
—
|
|
||||||
Parent cash dividends
|
(104,931
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(104,931
|
)
|
||||||
Net (payments) proceeds associated with employee
stock-based awards
|
(1,975
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,975
|
)
|
||||||
Excess tax (deficiency) benefit from stock-based compensation
|
(348
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(348
|
)
|
||||||
Cash Flows from Financing Activities
|
(115,717
|
)
|
|
(87,975
|
)
|
|
(14,191
|
)
|
|
41,885
|
|
|
195,259
|
|
|
19,261
|
|
||||||
Effect of exchange rates on cash and cash equivalents
|
—
|
|
|
—
|
|
|
(608
|
)
|
|
(2,926
|
)
|
|
—
|
|
|
(3,534
|
)
|
||||||
Increase (Decrease) in cash and cash equivalents
|
403
|
|
|
(2,506
|
)
|
|
(9,199
|
)
|
|
866
|
|
|
—
|
|
|
(10,436
|
)
|
||||||
Cash and cash equivalents, beginning of period
|
151
|
|
|
7,803
|
|
|
13,182
|
|
|
107,245
|
|
|
—
|
|
|
128,381
|
|
||||||
Cash and cash equivalents, end of period
|
$
|
554
|
|
|
$
|
5,297
|
|
|
$
|
3,983
|
|
|
$
|
108,111
|
|
|
$
|
—
|
|
|
$
|
117,945
|
|
|
Three Months Ended March 31, 2017
|
||||||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Canada
Company |
|
Non-
Guarantors |
|
Eliminations
|
|
Consolidated
|
||||||||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash Flows from Operating Activities—Continuing Operations
|
$
|
(41,288
|
)
|
|
$
|
136,411
|
|
|
$
|
5,291
|
|
|
$
|
21,760
|
|
|
$
|
—
|
|
|
$
|
122,174
|
|
Cash Flows from Operating Activities—Discontinued Operations
|
—
|
|
|
198
|
|
|
(535
|
)
|
|
—
|
|
|
—
|
|
|
(337
|
)
|
||||||
Cash Flows from Operating Activities
|
(41,288
|
)
|
|
136,609
|
|
|
4,756
|
|
|
21,760
|
|
|
—
|
|
|
121,837
|
|
||||||
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Capital expenditures
|
—
|
|
|
(53,175
|
)
|
|
(2,555
|
)
|
|
(17,472
|
)
|
|
—
|
|
|
(73,202
|
)
|
||||||
Cash paid for acquisitions, net of cash acquired
|
—
|
|
|
(6,380
|
)
|
|
—
|
|
|
(5,807
|
)
|
|
—
|
|
|
(12,187
|
)
|
||||||
Intercompany loans to subsidiaries
|
(1,187
|
)
|
|
(72,807
|
)
|
|
—
|
|
|
(478
|
)
|
|
74,472
|
|
|
—
|
|
||||||
Investment in subsidiaries
|
(16,170
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,170
|
|
|
—
|
|
||||||
Acquisitions of customer relationships and customer inducements
|
—
|
|
|
(20,653
|
)
|
|
(271
|
)
|
|
(479
|
)
|
|
—
|
|
|
(21,403
|
)
|
||||||
Net proceeds from Iron Mountain Divestments (see Note 10)
|
—
|
|
|
—
|
|
|
—
|
|
|
2,423
|
|
|
—
|
|
|
2,423
|
|
||||||
Proceeds from sales of property and equipment and other, net (including real estate)
|
—
|
|
|
93
|
|
|
2
|
|
|
(29
|
)
|
|
—
|
|
|
66
|
|
||||||
Cash Flows from Investing Activities—Continuing Operations
|
(17,357
|
)
|
|
(152,922
|
)
|
|
(2,824
|
)
|
|
(21,842
|
)
|
|
90,642
|
|
|
(104,303
|
)
|
||||||
Cash Flows from Investing Activities—Discontinued Operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cash Flows from Investing Activities
|
(17,357
|
)
|
|
(152,922
|
)
|
|
(2,824
|
)
|
|
(21,842
|
)
|
|
90,642
|
|
|
(104,303
|
)
|
||||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Repayment of revolving credit and term loan facilities and other debt
|
(31,733
|
)
|
|
(1,495,558
|
)
|
|
(71
|
)
|
|
(1,154,986
|
)
|
|
—
|
|
|
(2,682,348
|
)
|
||||||
Proceeds from revolving credit and term loan facilities and other debt
|
94,811
|
|
|
1,423,653
|
|
|
—
|
|
|
1,196,319
|
|
|
—
|
|
|
2,714,783
|
|
||||||
Borrowings (payments) under cash pools
|
—
|
|
|
138,693
|
|
|
—
|
|
|
47,129
|
|
|
(185,822
|
)
|
|
—
|
|
||||||
Debt financing from (repayment to) and equity contribution from (distribution to) noncontrolling interests, net
|
—
|
|
|
—
|
|
|
—
|
|
|
10,668
|
|
|
—
|
|
|
10,668
|
|
||||||
Intercompany loans from parent
|
—
|
|
|
(9,305
|
)
|
|
(12,680
|
)
|
|
96,457
|
|
|
(74,472
|
)
|
|
—
|
|
||||||
Equity contribution from parent
|
—
|
|
|
—
|
|
|
—
|
|
|
16,170
|
|
|
(16,170
|
)
|
|
—
|
|
||||||
Parent cash dividends
|
(2,060
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,060
|
)
|
||||||
Net payments associated with employee stock-based awards
|
(4,308
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,308
|
)
|
||||||
Payment of debt financing and stock issuance costs
|
—
|
|
|
—
|
|
|
(73
|
)
|
|
—
|
|
|
—
|
|
|
(73
|
)
|
||||||
Cash Flows from Financing Activities—Continuing Operations
|
56,710
|
|
|
57,483
|
|
|
(12,824
|
)
|
|
211,757
|
|
|
(276,464
|
)
|
|
36,662
|
|
||||||
Cash Flows from Financing Activities—Discontinued Operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cash Flows from Financing Activities
|
56,710
|
|
|
57,483
|
|
|
(12,824
|
)
|
|
211,757
|
|
|
(276,464
|
)
|
|
36,662
|
|
||||||
Effect of exchange rates on cash and cash equivalents
|
—
|
|
|
—
|
|
|
(455
|
)
|
|
5,403
|
|
|
—
|
|
|
4,948
|
|
||||||
(Decrease) Increase in cash and cash equivalents
|
(1,935
|
)
|
|
41,170
|
|
|
(11,347
|
)
|
|
217,078
|
|
|
(185,822
|
)
|
|
59,144
|
|
||||||
Cash and cash equivalents, beginning of period
|
2,405
|
|
|
23,380
|
|
|
17,110
|
|
|
193,589
|
|
|
—
|
|
|
236,484
|
|
||||||
Cash and cash equivalents, end of period
|
$
|
470
|
|
|
$
|
64,550
|
|
|
$
|
5,763
|
|
|
$
|
410,667
|
|
|
$
|
(185,822
|
)
|
|
$
|
295,628
|
|
•
|
North American Records and Information Management Business
|
•
|
North American Data Management Business
|
•
|
Western European Business
|
•
|
Other International Business
|
•
|
Corporate and Other Business
|
|
|
North American
Records and Information Management Business |
|
North American
Data Management Business |
|
Western European Business
|
|
Other International Business
|
|
Corporate
and Other
Business
|
|
Total
Consolidated |
||||||||||||
For the Three Months Ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total Revenues
|
|
$
|
444,681
|
|
|
$
|
96,343
|
|
|
$
|
93,876
|
|
|
$
|
101,341
|
|
|
$
|
14,449
|
|
|
$
|
750,690
|
|
Depreciation and Amortization
|
|
45,350
|
|
|
5,670
|
|
|
11,251
|
|
|
14,286
|
|
|
10,647
|
|
|
87,204
|
|
||||||
Depreciation
|
|
40,255
|
|
|
5,422
|
|
|
8,671
|
|
|
10,902
|
|
|
10,140
|
|
|
75,390
|
|
||||||
Amortization
|
|
5,095
|
|
|
248
|
|
|
2,580
|
|
|
3,384
|
|
|
507
|
|
|
11,814
|
|
||||||
Adjusted EBITDA
|
|
176,557
|
|
|
53,460
|
|
|
31,946
|
|
|
21,576
|
|
|
(48,393
|
)
|
|
235,146
|
|
||||||
Expenditures for Segment Assets
|
|
46,666
|
|
|
4,827
|
|
|
6,060
|
|
|
32,156
|
|
|
17,741
|
|
|
107,450
|
|
||||||
Capital Expenditures
|
|
42,088
|
|
|
4,827
|
|
|
4,059
|
|
|
12,162
|
|
|
17,716
|
|
|
80,852
|
|
||||||
Cash (Received) Paid for Acquisitions, Net of Cash Acquired
|
|
(130
|
)
|
|
—
|
|
|
—
|
|
|
19,470
|
|
|
—
|
|
|
19,340
|
|
||||||
Acquisitions of Customer Relationships and Customer Inducements
|
|
4,708
|
|
|
—
|
|
|
2,001
|
|
|
524
|
|
|
25
|
|
|
7,258
|
|
||||||
For the Three Months Ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total Revenues
|
|
507,597
|
|
|
106,950
|
|
|
120,072
|
|
|
189,241
|
|
|
15,016
|
|
|
938,876
|
|
||||||
Depreciation and Amortization
|
|
60,535
|
|
|
8,933
|
|
|
14,297
|
|
|
27,676
|
|
|
13,266
|
|
|
124,707
|
|
||||||
Depreciation
|
|
51,952
|
|
|
6,673
|
|
|
10,888
|
|
|
19,305
|
|
|
10,774
|
|
|
99,592
|
|
||||||
Amortization
|
|
8,583
|
|
|
2,260
|
|
|
3,409
|
|
|
8,371
|
|
|
2,492
|
|
|
25,115
|
|
||||||
Adjusted EBITDA
|
|
209,530
|
|
|
55,912
|
|
|
34,142
|
|
|
55,347
|
|
|
(62,357
|
)
|
|
292,574
|
|
||||||
Expenditures for Segment Assets
|
|
51,888
|
|
|
8,737
|
|
|
5,025
|
|
|
18,620
|
|
|
22,522
|
|
|
106,792
|
|
||||||
Capital Expenditures
|
|
26,578
|
|
|
8,737
|
|
|
4,898
|
|
|
12,467
|
|
|
20,522
|
|
|
73,202
|
|
||||||
Cash Paid (Received) for Acquisitions, Net of Cash Acquired
|
|
4,379
|
|
|
—
|
|
|
—
|
|
|
5,808
|
|
|
2,000
|
|
|
12,187
|
|
||||||
Acquisitions of Customer Relationships and Customer Inducements
|
|
20,931
|
|
|
—
|
|
|
127
|
|
|
345
|
|
|
—
|
|
|
21,403
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Adjusted EBITDA
|
$
|
235,146
|
|
|
$
|
292,574
|
|
(Add)/Deduct:
|
|
|
|
||||
(Gain) Loss on Disposal/Write-Down of Property, Plant and Equipment (Excluding Real Estate), Net
|
(451
|
)
|
|
(459
|
)
|
||
Provision (Benefit) for Income Taxes
|
11,900
|
|
|
9,220
|
|
||
Other (Income) Expense, Net
|
(11,937
|
)
|
|
(6,364
|
)
|
||
Interest Expense, Net
|
67,062
|
|
|
86,055
|
|
||
Depreciation and Amortization
|
87,204
|
|
|
124,707
|
|
||
Recall Costs(1)
|
18,327
|
|
|
20,571
|
|
||
Income (Loss) from Continuing Operations
|
$
|
63,041
|
|
|
$
|
58,844
|
|
(1)
|
Represents operating expenditures to complete the Recall Transaction, including advisory and professional fees and costs to complete the Divestments required in connection with receipt of regulatory approval, including transitional services required to support the divested businesses during a transition period and operating expenditures to integrate Recall with our existing operations, including moving, severance, facility upgrade, REIT conversion and system upgrade costs ("Recall Costs").
|
Declaration Date
|
|
Dividend
Per Share |
|
Record Date
|
|
Total
Amount |
|
Payment Date
|
|||
February 17, 2016
|
|
0.4850
|
|
|
March 7, 2016
|
|
$
|
102,651
|
|
|
March 21, 2016
|
May 25, 2016
|
|
0.4850
|
|
|
June 6, 2016
|
|
127,469
|
|
|
June 24, 2016
|
|
July 27, 2016
|
|
0.4850
|
|
|
September 12, 2016
|
|
127,737
|
|
|
September 30, 2016
|
|
October 31, 2016
|
|
0.5500
|
|
|
December 15, 2016
|
|
145,006
|
|
|
December 30, 2016
|
|
February 15, 2017
|
|
0.5500
|
|
|
March 15, 2017
|
|
145,235
|
|
|
April 3, 2017
|
|
|
Three Months Ended March 31, 2017
|
|||||||||||||||||||
Description
|
|
Initial
United States Divestments
|
|
Seattle/Atlanta Divestments
|
|
Recall Canadian Divestments
|
|
UK Divestments
|
|
Total(1)
|
|||||||||||
Income (Loss) from Discontinued Operations Before Provision (Benefit) for Income Taxes
|
|
$
|
—
|
|
|
$
|
239
|
|
|
$
|
(668
|
)
|
|
$
|
—
|
|
|
$
|
(429
|
)
|
|
Provision (Benefit) for Income Taxes
|
|
—
|
|
|
41
|
|
—
|
|
(133
|
)
|
|
—
|
|
|
(92
|
)
|
|||||
Income (Loss) from Discontinued Operations, Net of Tax
|
|
$
|
—
|
|
|
$
|
198
|
|
|
$
|
(535
|
)
|
|
$
|
—
|
|
|
$
|
(337
|
)
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2016
|
|
2017
|
||||
Cost of sales (excluding depreciation and amortization)
|
|
$
|
—
|
|
|
$
|
7,887
|
|
Selling, general and administrative expenses
|
|
18,327
|
|
|
12,684
|
|
||
Total Recall Costs
|
|
$
|
18,327
|
|
|
$
|
20,571
|
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2016
|
|
2017
|
||||
North American Records and Information Management Business
|
|
$
|
39
|
|
|
$
|
7,299
|
|
North American Data Management Business
|
|
—
|
|
|
873
|
|
||
Western European Business
|
|
217
|
|
|
3,216
|
|
||
Other International Business
|
|
431
|
|
|
1,651
|
|
||
Corporate and Other Business
|
|
17,640
|
|
|
7,532
|
|
||
Total Recall Costs
|
|
$
|
18,327
|
|
|
$
|
20,571
|
|
|
Accrual for Recall Costs
|
||
Balance at December 31, 2016
|
$
|
4,914
|
|
Amounts accrued
|
5,147
|
|
|
Change in estimates(1)
|
(230
|
)
|
|
Payments
|
(5,371
|
)
|
|
Currency translation adjustments
|
47
|
|
|
Balance at March 31, 2017(2)
|
$
|
4,507
|
|
(1)
|
Includes adjustments made to amounts accrued in a prior period.
|
(2)
|
Accrued liabilities related to Recall Costs as of March 31, 2017 presented in the table above generally related to employee severance costs and onerous lease liabilities. We expect that the majority of these liabilities will be paid throughout 2017. Additional Recall Costs recorded in our Consolidated Statement of Operations have either been settled in cash during the three months ended March 31, 2017 or are included in our Consolidated Balance Sheet as of March 31, 2017 as a component of accounts payable.
|
•
|
our ability to remain qualified for taxation as a real estate investment trust for United States federal income tax purposes ("REIT");
|
•
|
the adoption of alternative technologies and shifts by our customers to storage of data through non-paper based technologies;
|
•
|
changes in customer preferences and demand for our storage and information management services;
|
•
|
the cost to comply with current and future laws, regulations and customer demands relating to data security and privacy issues, as well as fire and safety standards;
|
•
|
the impact of litigation or disputes that may arise in connection with incidents in which we fail to protect our customers' information;
|
•
|
changes in the price for our storage and information management services relative to the cost of providing such storage and information management services;
|
•
|
changes in the political and economic environments in the countries in which our international subsidiaries operate and changes in the global political climate;
|
•
|
our ability or inability to complete acquisitions on satisfactory terms and to integrate acquired companies efficiently;
|
•
|
changes in the amount of our capital expenditures;
|
•
|
changes in the cost of our debt;
|
•
|
the impact of alternative, more attractive investments on dividends;
|
•
|
the cost or potential liabilities associated with real estate necessary for our business;
|
•
|
the performance of business partners upon whom we depend for technical assistance or management expertise outside the United States; and
|
•
|
other trends in competitive or economic conditions affecting our financial condition or results of operations not presently contemplated.
|
|
Average Exchange
Rates for the
Three Months Ended
March 31,
|
|
Percentage
Strengthening /
(Weakening) of
Foreign Currency
|
|||||||
|
2016
|
|
2017
|
|
||||||
Australian dollar
|
$
|
0.722
|
|
|
$
|
0.758
|
|
|
5.0
|
%
|
Brazilian real
|
$
|
0.257
|
|
|
$
|
0.318
|
|
|
23.7
|
%
|
British pound sterling
|
$
|
1.433
|
|
|
$
|
1.239
|
|
|
(13.5
|
)%
|
Canadian dollar
|
$
|
0.729
|
|
|
$
|
0.756
|
|
|
3.7
|
%
|
Euro
|
$
|
1.103
|
|
|
$
|
1.066
|
|
|
(3.4
|
)%
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Income (Loss) from Continuing Operations
|
$
|
63,041
|
|
|
$
|
58,844
|
|
Add/(Deduct):
|
|
|
|
||||
Provision (Benefit) for Income Taxes
|
11,900
|
|
|
9,220
|
|
||
Other (Income) Expense, Net
|
(11,937
|
)
|
|
(6,364
|
)
|
||
Interest Expense, Net
|
67,062
|
|
|
86,055
|
|
||
(Gain) Loss on Disposal/Write-Down of Property, Plant and Equipment (Excluding Real Estate), Net
|
(451
|
)
|
|
(459
|
)
|
||
Depreciation and Amortization
|
87,204
|
|
|
124,707
|
|
||
Recall Costs
|
18,327
|
|
|
20,571
|
|
||
Adjusted EBITDA
|
$
|
235,146
|
|
|
$
|
292,574
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Reported EPS—Fully Diluted from Continuing Operations
|
$
|
0.30
|
|
|
$
|
0.22
|
|
Add/(Deduct):
|
|
|
|
||||
Income (Loss) Attributable to Noncontrolling Interests
|
—
|
|
|
—
|
|
||
Other (Income) Expense, Net
|
(0.06
|
)
|
|
(0.02
|
)
|
||
(Gain) Loss on Disposal/Write-Down of Property, Plant and Equipment (Excluding Real Estate), Net
|
—
|
|
|
—
|
|
||
Recall Costs
|
0.09
|
|
|
0.08
|
|
||
Tax Impact of Reconciling Items and Discrete Tax Items(1)
|
—
|
|
|
(0.04
|
)
|
||
Adjusted EPS—Fully Diluted from Continuing Operations(2)
|
$
|
0.33
|
|
|
$
|
0.24
|
|
(1)
|
The difference between our effective tax rate and our structural tax rate (or adjusted effective tax rate) for the
three
months ended
March 31,
2016 and 2017, respectively, is primarily due to (i) the reconciling items above, which impact our reported income (loss) from continuing operations before provision (benefit) for income taxes but have an insignificant impact on our reported provision (benefit) for income taxes and (ii) other discrete tax items. Our structural tax rate for purposes of the calculation of Adjusted EPS for the
three
months ended
March 31,
2016 and 2017 was 14.0% and 23.1%, respectively.
|
(2)
|
Columns may not foot due to rounding.
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2017
|
||||
Net Income (Loss)
|
$
|
63,041
|
|
|
$
|
58,507
|
|
Add/(Deduct):
|
|
|
|
||||
Real Estate Depreciation(1)
|
45,063
|
|
|
62,956
|
|
||
FFO (NAREIT)
|
108,104
|
|
|
121,463
|
|
||
Add/(Deduct):
|
|
|
|
||||
(Gain) Loss on Disposal/Write-Down of Property, Plant and Equipment (Excluding Real Estate), Net
|
(451
|
)
|
|
(459
|
)
|
||
Other (Income) Expense, Net(2)
|
(11,937
|
)
|
|
(6,364
|
)
|
||
Recall Costs
|
18,327
|
|
|
20,571
|
|
||
Tax Impact of Reconciling Items and Discrete Tax Items(3)
|
577
|
|
|
(9,678
|
)
|
||
Loss (Income) from Discontinued Operations, Net of Tax(4)
|
—
|
|
|
337
|
|
||
FFO (Normalized)
|
$
|
114,620
|
|
|
$
|
125,870
|
|
(1)
|
Includes depreciation expense related to real estate assets (land improvements, buildings, building improvements, leasehold improvements and racking).
|
(2)
|
Includes foreign currency transaction (gains) losses, net of
$(12.5) million
and
$(4.2) million
in the
three
months ended
March 31, 2016
and 2017, respectively.
|
(3)
|
Represents the tax impact of (i) the reconciling items above, which impact our reported income (loss) from continuing operations before provision (benefit) for income taxes but have an insignificant impact on our reported provision (benefit) for income taxes and (ii) other discrete tax items.
|
(4)
|
Net of tax benefit of $0.1 million for the
three
months ended March 31, 2017.
|
•
|
Revenue Recognition
|
•
|
Accounting for Acquisitions
|
•
|
Impairment of Tangible and Intangible Assets
|
•
|
Income Taxes
|
|
Three Months Ended
March 31, |
|
|
|
|
|||||||||
|
|
Dollar
Change
|
|
Percentage
Change
|
||||||||||
|
2016
|
|
2017
|
|
|
|||||||||
Revenues
|
$
|
750,690
|
|
|
$
|
938,876
|
|
|
$
|
188,186
|
|
|
25.1
|
%
|
Operating Expenses
|
620,624
|
|
|
791,121
|
|
|
170,497
|
|
|
27.5
|
%
|
|||
Operating Income
|
130,066
|
|
|
147,755
|
|
|
17,689
|
|
|
13.6
|
%
|
|||
Other Expenses, Net
|
67,025
|
|
|
88,911
|
|
|
21,886
|
|
|
32.7
|
%
|
|||
Income from Continuing Operations
|
63,041
|
|
|
58,844
|
|
|
(4,197
|
)
|
|
(6.7
|
)%
|
|||
Loss from Discontinued Operations, Net of Tax
|
—
|
|
|
(337
|
)
|
|
(337
|
)
|
|
(100.0
|
)%
|
|||
Net Income
|
63,041
|
|
|
58,507
|
|
|
(4,534
|
)
|
|
(7.2
|
)%
|
|||
Net Income Attributable to Noncontrolling Interests
|
267
|
|
|
382
|
|
|
115
|
|
|
43.1
|
%
|
|||
Net Income Attributable to Iron Mountain Incorporated
|
$
|
62,774
|
|
|
$
|
58,125
|
|
|
$
|
(4,649
|
)
|
|
(7.4
|
)%
|
Adjusted EBITDA(1)
|
$
|
235,146
|
|
|
$
|
292,574
|
|
|
$
|
57,428
|
|
|
24.4
|
%
|
Adjusted EBITDA Margin(1)
|
31.3
|
%
|
|
31.2
|
%
|
|
|
|
|
|
(1)
|
See "Non-GAAP Measures—Adjusted EBITDA" in this Quarterly Report for the definition, reconciliation and a discussion of why we believe these measures provide relevant and useful information to our current and potential investors.
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
|
|||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency(1)
|
|
Internal
Growth(2)
|
||||||||||||
|
2016
|
|
2017
|
|
|
|
|
|||||||||||||
Storage Rental
|
$
|
461,211
|
|
|
$
|
572,279
|
|
|
$
|
111,068
|
|
|
24.1
|
%
|
|
24.6
|
%
|
|
3.0
|
%
|
Service
|
289,479
|
|
|
366,597
|
|
|
77,118
|
|
|
26.6
|
%
|
|
26.7
|
%
|
|
0.6
|
%
|
|||
Total Revenues
|
$
|
750,690
|
|
|
$
|
938,876
|
|
|
$
|
188,186
|
|
|
25.1
|
%
|
|
25.4
|
%
|
|
2.0
|
%
|
|
(1)
|
Constant currency growth rates are calculated by translating the
2016
results at the
2017
average exchange rates.
|
(2)
|
Our internal revenue growth rate, which is a non-GAAP measure, represents the weighted average year-over-year growth rate of our revenues excluding the impact of business acquisitions, divestitures and foreign currency exchange rate fluctuations. The revenues generated by Recall have been integrated with our existing revenues and it is impracticable for us to determine actual Recall revenue contribution for the applicable periods. Therefore, our internal revenue growth rates exclude the impact of revenues associated with the Recall Transaction based upon forecasted or budgeted Recall revenues beginning in the third quarter of 2016. Our internal revenue growth rate includes the impact of acquisitions of customer relationships.
|
|
2015
|
|
2016
|
|
2017
|
||||||||||||||||||
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
First
Quarter
|
||||||||
Storage Rental Revenue
|
2.7
|
%
|
|
2.8
|
%
|
|
2.2
|
%
|
|
2.2
|
%
|
|
2.1
|
%
|
|
2.1
|
%
|
|
2.9
|
%
|
|
3.0
|
%
|
Service Revenue
|
—
|
%
|
|
(0.9
|
)%
|
|
0.3
|
%
|
|
1.6
|
%
|
|
(2.1
|
)%
|
|
(1.3
|
)%
|
|
(0.9
|
)%
|
|
0.6
|
%
|
Total Revenue
|
1.6
|
%
|
|
1.3
|
%
|
|
1.4
|
%
|
|
2.0
|
%
|
|
0.4
|
%
|
|
0.8
|
%
|
|
1.4
|
%
|
|
2.0
|
%
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
% of
Consolidated
Revenues
|
|
Percentage
Change
(Favorable)/
Unfavorable
|
|||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency
|
|
|
||||||||||||||||||
|
2016
|
|
2017
|
|
|
|
|
2016
|
|
2017
|
|
|||||||||||||||
Labor
|
$
|
169,028
|
|
|
$
|
200,160
|
|
|
$
|
31,132
|
|
|
18.4
|
%
|
|
18.2
|
%
|
|
22.5
|
%
|
|
21.3
|
%
|
|
(1.2
|
)%
|
Facilities
|
104,194
|
|
|
144,253
|
|
|
40,059
|
|
|
38.4
|
%
|
|
38.2
|
%
|
|
13.9
|
%
|
|
15.4
|
%
|
|
1.5
|
%
|
|||
Transportation
|
25,249
|
|
|
35,221
|
|
|
9,972
|
|
|
39.5
|
%
|
|
39.9
|
%
|
|
3.4
|
%
|
|
3.8
|
%
|
|
0.4
|
%
|
|||
Product Cost of Sales and Other
|
27,634
|
|
|
39,186
|
|
|
11,552
|
|
|
41.8
|
%
|
|
41.4
|
%
|
|
3.7
|
%
|
|
4.2
|
%
|
|
0.5
|
%
|
|||
Recall Costs
|
—
|
|
|
7,887
|
|
|
7,887
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
—
|
%
|
|
0.8
|
%
|
|
0.8
|
%
|
|||
|
$
|
326,105
|
|
|
$
|
426,707
|
|
|
$
|
100,602
|
|
|
30.8
|
%
|
|
30.6
|
%
|
|
43.4
|
%
|
|
45.4
|
%
|
|
2.0
|
%
|
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
% of
Consolidated
Revenues
|
|
Percentage
Change
(Favorable)/
Unfavorable
|
|||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency
|
|
|
||||||||||||||||||
|
2016
|
|
2017
|
|
|
|
|
2016
|
|
2017
|
|
|||||||||||||||
General and Administrative
|
$
|
111,988
|
|
|
$
|
134,800
|
|
|
$
|
22,812
|
|
|
20.4
|
%
|
|
21.2
|
%
|
|
14.9
|
%
|
|
14.4
|
%
|
|
(0.5
|
)%
|
Sales, Marketing & Account Management
|
53,222
|
|
|
63,306
|
|
|
10,084
|
|
|
18.9
|
%
|
|
19.7
|
%
|
|
7.1
|
%
|
|
6.7
|
%
|
|
(0.4
|
)%
|
|||
Information Technology
|
24,091
|
|
|
31,793
|
|
|
7,702
|
|
|
32.0
|
%
|
|
33.1
|
%
|
|
3.2
|
%
|
|
3.4
|
%
|
|
0.2
|
%
|
|||
Bad Debt Expense
|
138
|
|
|
(2,417
|
)
|
|
(2,555
|
)
|
|
(1,851.4
|
)%
|
|
(1,563.9
|
)%
|
|
—
|
%
|
|
(0.3
|
)%
|
|
(0.3
|
)%
|
|||
Recall Costs
|
18,327
|
|
|
12,684
|
|
|
(5,643
|
)
|
|
(30.8
|
)%
|
|
(30.8
|
)%
|
|
2.4
|
%
|
|
1.4
|
%
|
|
(1.0
|
)%
|
|||
|
$
|
207,766
|
|
|
$
|
240,166
|
|
|
$
|
32,400
|
|
|
15.6
|
%
|
|
16.3
|
%
|
|
27.7
|
%
|
|
25.6
|
%
|
|
(2.1
|
)%
|
|
|
Three Months Ended
March 31, |
|
Dollar
Change
|
||||||||
|
2016
|
|
2017
|
|
|||||||
Foreign currency transaction (gains) losses, net
|
$
|
(12,542
|
)
|
|
$
|
(4,164
|
)
|
|
$
|
8,378
|
|
Other, net
|
605
|
|
|
(2,200
|
)
|
|
(2,805
|
)
|
|||
|
$
|
(11,937
|
)
|
|
$
|
(6,364
|
)
|
|
$
|
5,573
|
|
|
Three Months Ended
March 31, |
|
Dollar
Change
|
|
Percentage Change
|
|||||||||
|
2016
|
|
2017
|
|
||||||||||
Income from Continuing Operations
|
$
|
63,041
|
|
|
$
|
58,844
|
|
|
$
|
(4,197
|
)
|
|
(6.7
|
)%
|
Income from Continuing Operations as a percentage of Consolidated Revenue
|
8.4
|
%
|
|
6.3
|
%
|
|
|
|
|
|||||
Adjusted EBITDA
|
235,146
|
|
|
292,574
|
|
|
57,428
|
|
|
24.4
|
%
|
|||
Adjusted EBITDA Margin
|
31.3
|
%
|
|
31.2
|
%
|
|
|
|
|
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
|
|||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency
|
|
Internal
Growth
|
||||||||||||
|
2016
|
|
2017
|
|
|
|
|
|||||||||||||
Storage Rental
|
$
|
267,223
|
|
|
$
|
298,183
|
|
|
$
|
30,960
|
|
|
11.6
|
%
|
|
11.2
|
%
|
|
1.9
|
%
|
Service
|
177,458
|
|
|
209,414
|
|
|
31,956
|
|
|
18.0
|
%
|
|
17.5
|
%
|
|
1.1
|
%
|
|||
Segment Revenue
|
$
|
444,681
|
|
|
$
|
507,597
|
|
|
$
|
62,916
|
|
|
14.1
|
%
|
|
13.7
|
%
|
|
1.6
|
%
|
Segment Adjusted EBITDA(1)
|
$
|
176,557
|
|
|
$
|
209,530
|
|
|
$
|
32,973
|
|
|
|
|
|
|
|
|||
Segment Adjusted EBITDA(1) as a percentage of Segment Revenue
|
39.7
|
%
|
|
41.3
|
%
|
|
|
|
|
|
|
|
|
|
(1)
|
See Note 7 to Notes to Consolidated Financial Statements included in this Quarterly Report for the definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to income (loss) from continuing operations.
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
|
|||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency
|
|
Internal
Growth
|
||||||||||||
|
2016
|
|
2017
|
|
|
|
|
|||||||||||||
Storage Rental
|
$
|
65,348
|
|
|
$
|
73,312
|
|
|
$
|
7,964
|
|
|
12.2
|
%
|
|
11.9
|
%
|
|
2.7
|
%
|
Service
|
30,995
|
|
|
33,638
|
|
|
2,643
|
|
|
8.5
|
%
|
|
8.3
|
%
|
|
(6.7
|
)%
|
|||
Segment Revenue
|
$
|
96,343
|
|
|
$
|
106,950
|
|
|
$
|
10,607
|
|
|
11.0
|
%
|
|
10.8
|
%
|
|
(0.3
|
)%
|
Segment Adjusted EBITDA(1)
|
$
|
53,460
|
|
|
$
|
55,912
|
|
|
$
|
2,452
|
|
|
|
|
|
|
|
|||
Segment Adjusted EBITDA(1) as a percentage of Segment Revenue
|
55.5
|
%
|
|
52.3
|
%
|
|
|
|
|
|
|
|
|
|
(1)
|
See Note 7 to Notes to Consolidated Financial Statements included in this Quarterly Report for the definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to income (loss) from continuing operations.
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
|
|||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency
|
|
Internal
Growth
|
||||||||||||
|
2016
|
|
2017
|
|
|
|
|
|||||||||||||
Storage Rental
|
$
|
57,819
|
|
|
$
|
71,567
|
|
|
$
|
13,748
|
|
|
23.8
|
%
|
|
37.2
|
%
|
|
1.7
|
%
|
Service
|
36,057
|
|
|
48,505
|
|
|
12,448
|
|
|
34.5
|
%
|
|
48.0
|
%
|
|
4.4
|
%
|
|||
Segment Revenue
|
$
|
93,876
|
|
|
$
|
120,072
|
|
|
$
|
26,196
|
|
|
27.9
|
%
|
|
41.3
|
%
|
|
2.7
|
%
|
Segment Adjusted EBITDA(1)
|
$
|
31,946
|
|
|
$
|
34,142
|
|
|
$
|
2,196
|
|
|
|
|
|
|
|
|||
Segment Adjusted EBITDA(1) as a percentage of Segment Revenue
|
34.0
|
%
|
|
28.4
|
%
|
|
|
|
|
|
|
|
|
|
(1)
|
See Note 7 to Notes to Consolidated Financial Statements included in this Quarterly Report for the definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to income (loss) from continuing operations.
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
|
|||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency
|
|
Internal
Growth
|
||||||||||||
|
2016
|
|
2017
|
|
|
|
|
|||||||||||||
Storage Rental
|
$
|
60,416
|
|
|
$
|
117,615
|
|
|
$
|
57,199
|
|
|
94.7
|
%
|
|
86.0
|
%
|
|
8.3
|
%
|
Service
|
40,925
|
|
|
71,626
|
|
|
30,701
|
|
|
75.0
|
%
|
|
65.8
|
%
|
|
2.8
|
%
|
|||
Segment Revenue
|
$
|
101,341
|
|
|
$
|
189,241
|
|
|
$
|
87,900
|
|
|
86.7
|
%
|
|
77.8
|
%
|
|
6.1
|
%
|
Segment Adjusted EBITDA(1)
|
$
|
21,576
|
|
|
$
|
55,347
|
|
|
$
|
33,771
|
|
|
|
|
|
|
|
|||
Segment Adjusted EBITDA(1) as a percentage of Segment Revenue
|
21.3
|
%
|
|
29.2
|
%
|
|
|
|
|
|
|
|
|
|
(1)
|
See Note 7 to Notes to Consolidated Financial Statements included in this Quarterly Report for the definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to income (loss) from continuing operations.
|
|
Three Months Ended
March 31, |
|
|
|
Percentage Change
|
|
|
|||||||||||||
|
|
Dollar
Change
|
|
Actual
|
|
Constant
Currency
|
|
Internal
Growth
|
||||||||||||
|
2016
|
|
2017
|
|
|
|
|
|||||||||||||
Storage Rental
|
$
|
10,405
|
|
|
$
|
11,602
|
|
|
$
|
1,197
|
|
|
11.5
|
%
|
|
11.5
|
%
|
|
9.0
|
%
|
Service
|
4,044
|
|
|
3,414
|
|
|
(630
|
)
|
|
(15.6
|
)%
|
|
(15.6
|
)%
|
|
(18.3
|
)%
|
|||
Segment Revenue
|
$
|
14,449
|
|
|
$
|
15,016
|
|
|
$
|
567
|
|
|
3.9
|
%
|
|
3.9
|
%
|
|
1.4
|
%
|
Segment Adjusted EBITDA(1)
|
$
|
(48,393
|
)
|
|
$
|
(62,357
|
)
|
|
$
|
(13,964
|
)
|
|
|
|
|
|
|
|||
Segment Adjusted EBITDA(1) as a percentage of Consolidated Revenue
|
(6.4
|
)%
|
|
(6.6
|
)%
|
|
|
|
|
|
|
|
|
|
(1)
|
See Note 7 to Notes to Consolidated Financial Statements included in this Quarterly Report for the definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to income (loss) from continuing operations.
|
|
2016
|
|
2017
|
||||
Cash flows from operating activities - continuing operations
|
$
|
81,118
|
|
|
$
|
122,174
|
|
Cash flows from investing activities - continuing operations
|
(107,281
|
)
|
|
(104,303
|
)
|
||
Cash flows from financing activities - continuing operations
|
19,261
|
|
|
36,662
|
|
||
Cash and cash equivalents at the end of period
|
117,945
|
|
|
295,628
|
|
•
|
Real estate assets that support core business growth
primarily related to investments in land, buildings, building improvements, leasehold improvements and racking structures that expand our revenue capacity in existing or new geographies, replace a long-term operational obligation or create operational efficiencies ("Real Estate Investment").
|
•
|
Real estate assets necessary to maintain ongoing business operations primarily related to the repair or replacement of real estate assets such as buildings, building improvements, leasehold improvements and racking structures ("Real Estate Maintenance").
|
•
|
Non-real estate assets that either (i) support the growth of our business, and/or increase our profitability, such as customer-inventory technology systems, and technology service storage and processing capacity, or (ii) are directly related to the development of core products or services in support of our integrated value proposition and enhance our leadership position in the industry, including items such as increased feature functionality, security upgrades or system enhancements ("Non-Real Estate Investment").
|
•
|
Non-real estate assets necessary to maintain ongoing business operations primarily related to the repair or replacement of customer-facing assets such as containers and shred bins, warehouse equipment, fixtures, computer hardware, or third-party or internally-developed software assets. This category also includes operational support initiatives such as sales and marketing and information technology projects to support infrastructure requirements ("Non-Real Estate Maintenance").
|
•
|
Discretionary capital expenditures in significant new products and services in new, existing or adjacent business opportunities.
|
|
|
Three Months Ended
March 31, |
||||||
|
|
|||||||
Nature of Capital Spend (in thousands)
|
|
2016
|
|
2017
|
||||
Real Estate:
|
|
|
||||||
Investment
|
|
$
|
51,900
|
|
|
$
|
43,987
|
|
Maintenance
|
|
7,526
|
|
|
8,054
|
|
||
Total Real Estate Capital Spend
|
|
59,426
|
|
|
52,041
|
|
||
Non-Real Estate:
|
|
|
|
|
|
|
||
Investment
|
|
6,344
|
|
|
10,020
|
|
||
Maintenance
|
|
3,773
|
|
|
7,245
|
|
||
Total Non-Real Estate Capital Spend
|
|
10,117
|
|
|
17,265
|
|
||
Innovation and Growth Investment Capital Spend
|
|
1,341
|
|
|
4,382
|
|
||
Total Capital Spend (on accrual basis)
|
|
70,884
|
|
|
73,688
|
|
||
Net increase in prepaid capital expenditures
|
|
327
|
|
|
478
|
|
||
Net decrease (increase) in accrued capital expenditures
|
|
9,641
|
|
|
(964
|
)
|
||
Total Capital Spend (on cash basis)
|
|
$
|
80,852
|
|
|
$
|
73,202
|
|
|
|
March 31, 2017
|
||||||||||
|
|
Debt (inclusive of discount)
|
|
Unamortized Deferred Financing Costs
|
|
Carrying Amount
|
||||||
Revolving Credit Facility
|
|
$
|
988,327
|
|
|
$
|
(6,800
|
)
|
|
$
|
981,527
|
|
Term Loan
|
|
228,125
|
|
|
—
|
|
|
228,125
|
|
|||
Australian Dollar Term Loan
|
|
186,963
|
|
|
(3,832
|
)
|
|
183,131
|
|
|||
6% Senior Notes due 2020
|
|
1,000,000
|
|
|
(11,881
|
)
|
|
988,119
|
|
|||
4
3
/
8
% Notes
|
|
500,000
|
|
|
(7,163
|
)
|
|
492,837
|
|
|||
6
1
/
8
% CAD Senior Notes due 2021
|
|
150,045
|
|
|
(1,561
|
)
|
|
148,484
|
|
|||
6
1
/
8
% GBP Senior Notes due 2022
|
|
499,508
|
|
|
(6,012
|
)
|
|
493,496
|
|
|||
6% Senior Notes due 2023
|
|
600,000
|
|
|
(7,048
|
)
|
|
592,952
|
|
|||
CAD Notes due 2023
|
|
187,557
|
|
|
(3,405
|
)
|
|
184,152
|
|
|||
5
3
/
4
% Senior Subordinated Notes due 2024
|
|
1,000,000
|
|
|
(10,186
|
)
|
|
989,814
|
|
|||
5
3
/
8
% Notes
|
|
250,000
|
|
|
(3,937
|
)
|
|
246,063
|
|
|||
Real Estate Mortgages, Capital Leases and Other
|
|
518,191
|
|
|
(1,239
|
)
|
|
516,952
|
|
|||
Accounts Receivable Securitization Program(1)
|
|
250,000
|
|
|
(308
|
)
|
|
249,692
|
|
|||
Mortgage Securitization Program
|
|
50,000
|
|
|
(1,369
|
)
|
|
48,631
|
|
|||
Total Long-term Debt
|
|
6,408,716
|
|
|
(64,741
|
)
|
|
6,343,975
|
|
|||
Less Current Portion
|
|
(421,535
|
)
|
|
308
|
|
|
(421,227
|
)
|
|||
Long-term Debt, Net of Current Portion
|
|
$
|
5,987,181
|
|
|
$
|
(64,433
|
)
|
|
$
|
5,922,748
|
|
(1)
|
Because the Accounts Receivable Securitization Program terminates on March 6, 2018, at which point all obligations under the program become due, this debt is classified within the current portion of long-term debt in our Consolidated Balance Sheet as of March 31, 2017.
|
|
December 31, 2016
|
|
March 31, 2017
|
|
Maximum/Minimum Allowable
|
||
Net total lease adjusted leverage ratio
|
5.7
|
|
|
5.8
|
|
|
Maximum allowable of 6.5
|
Net secured debt lease adjusted leverage ratio
|
2.7
|
|
|
2.7
|
|
|
Maximum allowable of 4.0
|
Bond leverage ratio (not lease adjusted)
|
5.2
|
|
|
5.5
|
|
|
Maximum allowable of 6.5
|
Fixed charge coverage ratio
|
2.4
|
|
|
2.3
|
|
|
Minimum allowable of 1.5
|
|
|
Year Ended December 31, 2016
|
|
Three Months Ended
March 31, 2017
|
|
Cumulative Total
|
||||||
Recall Costs
|
|
$
|
131,944
|
|
|
$
|
20,571
|
|
|
$
|
199,529
|
|
Recall Capital Expenditures
|
|
18,391
|
|
|
6,255
|
|
|
24,711
|
|
|||
Total
|
|
$
|
150,335
|
|
|
$
|
26,826
|
|
|
$
|
224,240
|
|
Exhibit No.
|
|
Description
|
|
|
|
|
|
10.1
|
|
|
Marc Duale Separation Agreement dated March 13, 2017.
(Filed herewith.)
|
|
|
|
|
10.2
|
|
|
Ernest Cloutier Secondment Letter dated March 27, 2017.
(Filed herewith.)
|
|
|
|
|
10.3
|
|
|
|
|
|
|
|
12
|
|
|
Statement: re Computation of Ratios.
(Filed herewith.)
|
|
|
|
|
31.1
|
|
|
Rule 13a-14(a) Certification of Chief Executive Officer.
(Filed herewith.)
|
|
|
|
|
31.2
|
|
|
Rule 13a-14(a) Certification of Chief Financial Officer.
(Filed herewith.)
|
|
|
|
|
32.1
|
|
|
Section 1350 Certification of Chief Executive Officer.
(Furnished herewith.)
|
|
|
|
|
32.2
|
|
|
Section 1350 Certification of Chief Financial Officer.
(Furnished herewith.)
|
|
|
|
|
101.1
|
|
|
The following materials from Iron Mountain Incorporated's Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income (Loss), (iv) Consolidated Statements of Equity, (v) Consolidated Statements of Cash Flows and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text and in detail.
(Filed herewith.)
|
|
|
|
|
IRON MOUNTAIN INCORPORATED
|
|
|
By:
|
/s/ STUART B. BROWN
|
|
|
|
|
|
|
|
|
Stuart B. Brown
Executive Vice President and
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
-
|
The Employee entered into the service of the Iron Mountain Group on 8 May 2006 as President of Iron Mountain Europe, pursuant to an employment contract concluded on 3 May 2006 with Iron Mountain UK Ltd;
|
-
|
On 16 September 2008, the Employee was appointed as President of Iron Mountain International and on 15 June 2009, the Employee entered into an employment contract with Iron Mountain Belgium SA, replacing the employment contract signed on 3 May 2006 with Iron Mountain UK Ltd;
|
-
|
The Employee was seconded to Hong Kong by Iron Mountain Belgium SA, under the conditions set forth in an employment agreement signed on 18 December 2009;
|
-
|
On 31 December 2010, the employment agreement signed on 18 December 2009 between the Employee and Iron Mountain Belgium SA, was amended and transferred to the Company;
|
-
|
On 29 September 2011, said employment agreement was amended and replaced by a new contract of employment (the “
Employment Contract
”) signed between the Company and the Employee, as amended by an
addendum to the Employment Contract dated 29 September 2011 and 11 February 2015;
|
-
|
Following a certain reorganisation of the Iron Mountain Group, which took place in April 2015 (the “
Reorganisation
”), the Employee’s responsibilities were significantly reduced, giving him the right to elect termination of his Employment Contract, as amended, for Good Reason;
|
-
|
On 8 June 2015, Iron Mountain announced that it entered into a Scheme Deed relating to the merger of Recall Inc. into Iron Mountain (the “
Merger
”);
|
-
|
The Merger implied the need to integrate the business, operations and activities of Recall Inc. into Iron Mountain’s business, operations and activities (the “
Integration
”);
|
-
|
Iron Mountain wished to benefit from the assistance of the Employee in connection with the Integration;
|
-
|
At the request of Iron Mountain, the Employee accepted to assist in connection with the Integration for a limited period of time and the Parties concluded a third addendum to the Employment Contract (the “
Third Amended and Restated Employment Contract
”) on 24 February 2016
.
The Third Amended and Restated Employment Contract replaces all other written or oral commitments, undertakings and agreements between the Parties that preceded this and notably the Employment Contract;
|
-
|
By this agreement (the “
Agreement
”), the Parties wish to terminate the Third Amended and Restated Employment Contract by mutual agreement effective on 31 March 2017, and simultaneously settle any claims resulting from their employment relationship and the termination of the Third Amended and Restated Employment Contract.
|
2.1.
|
On or about the Termination Date, the Employer shall pay to the Employee together with his last monthly remuneration payment:
|
-
|
A bonus amounting to EUR 507,328 gross, in compliance with article 13.2.1. (ii) of the Third Amended and Restated Employment Contract;
|
-
|
A lump sum payment amounting to EUR 53,842 gross, as replacement of the Company’s coverage of the Employer cost of coverage for the
Company's International Medical Insurance Plan
in compliance with article 13.2.2(a) of the Third Amended and Restated Employment Contract;
|
-
|
There are no accrued but untaken holidays and, as such, no payment is due;
|
-
|
Any expenses, which have been incurred by the Employee until his last effective working day, in accordance with the Employer’s expense policies.
|
2.2.
|
The Employee is eligible to outplacement services for a period of 9 months as of the Termination Date. The Company has engaged Stork & May to provide such services to the Employee.
|
2.3.
|
As regards the Employee’s Target Performance Units, the awards below are eligible for vesting, but will be adjusted for actual performance at the end of the performance period. The Performance Units will not be paid until after the performance is known and certified in the first quarter of 2019.
|
Product Type Name
|
Grant Date
|
Vesting Date (estimated)
|
QTY Vesting
(Target)
|
Operational PUs
|
19/02/2015
|
19/02/2018
|
4,828
|
TSR PUs
|
19/02/2015
|
19/02/2018
|
4,828
|
2.4.
|
As regards the
RSUs and Option, the awards below will be subject to accelerated vesting at or around the Termination Date. The Employee will have 3 years to exercise the options below.
|
Product Type Name
|
Grant Date
|
Original
Vesting Date
|
QTY Vesting
|
Exercise Price
|
Restricted Units
|
19/02/2015
|
19/02/2018
|
1,936
|
N/A
|
Restricted Units
|
18/02/2016
|
18/02/2018
|
8,532
|
N/A
|
Stock Options
|
19/02/2015
|
19/02/2018
|
8,935
|
$38.83
|
1)
|
is applicable to activities similar to those exercised by the Employee with the Employer; this includes amongst other activities of the following entities: Brambles Limited, Cintas Corporation, Dell Inc, Fujitsu, Hewlett Packard Company, International Business Machines, Canon, Oce Business Services, Oracle Crop, Pitney Bowes Inc, Xerox Corporation. This list is however not limitative;
|
2)
|
relates to the following countries; Australia, Belgium, Brazil, Canada, Chile, China, France, Germany, Hong Kong, India, Luxemburg, Mexico, Netherlands, Russia, Spain, the United Kingdom and the United States.
|
/s/ Manfred Schneider
|
|
/s/ Marc Duale
|
|
|
|
The Employer
|
|
The Employee
|
Manfred Schneider, Manager
|
|
Marc Duale
|
|
|
|
/s/ Anne Best
|
|
|
|
|
|
The Employer
|
|
|
Anne Best, Manager
|
|
|
|
|
|
Position:
|
Executive Vice President & GM, International
|
Effective Date:
|
April 1, 2017
|
You will report to:
|
William Meaney, President & CEO, Iron Mountain
|
Home Country:
|
United States
|
Host Country:
|
Switzerland
|
•
|
at the end of this assignment
|
•
|
upon a Qualifying Termination under Iron Mountain’s Severance Program No. 1
|
•
|
at your election in the event that (i) the individual to whom you report shall change or (ii) it is necessary that you or a family member permanently return to the Home Country for unforeseen or unexpected circumstances.
|
/s/ Ernest W. Cloutier
|
|
March 27, 2017
|
|
|
|
Ernest W. Cloutier
|
|
Date
|
1.
|
INTERPRETATION
|
1
|
|
2.
|
TERM OF ENGAGEMENT
|
3
|
|
3.
|
DUTIES AND OBLIGATIONS
|
3
|
|
4.
|
FEES
|
5
|
|
5.
|
EXPENSES
|
5
|
|
6.
|
OTHER ACTIVITIES
|
6
|
|
7.
|
CONFIDENTIAL INFORMATION AND CLIENT PROPERTY
|
6
|
|
8.
|
DATA PROTECTION
|
6
|
|
9.
|
INTELLECTUAL PROPERTY
|
7
|
|
10.
|
LIABILITY
|
7
|
|
11.
|
TERMINATION
|
7
|
|
12.
|
OBLIGATIONS ON TERMINATION
|
8
|
|
13.
|
STATUS
|
8
|
|
14.
|
NOTICES
|
9
|
|
15.
|
ENTIRE AGREEMENT
|
9
|
|
16.
|
VARIATION
|
9
|
|
17.
|
COUNTERPARTS
|
9
|
|
18.
|
THIRD PARTY RIGHTS
|
10
|
|
19.
|
FORCE MAJEURE
|
10
|
|
20.
|
GOVERNING LAW AND JURISDICTION
|
10
|
|
SCHEDULE
|
The Services
|
12
|
|
(1)
|
IRON MOUNTAIN EUROPE PLC,
incorporated and registered in England and Wales with company number 02321917 whose registered office is at Cottons Centre 3
rd
Floor, Tooley Street, London SE1 2TT (the “
Client”
).
|
(2)
|
MR MARC DUALE
(the “
Advisor”
).
|
1.
|
INTERPRETATION
|
1.1
|
The definitions and rules of interpretation in this clause apply in this agreement (unless the context requires otherwise).
|
1.2
|
The headings in this agreement are inserted for convenience only and shall not affect its construction.
|
1.3
|
A reference to a particular law is a reference to it as it is in force for the time being taking account of any amendment, extension or re-enactment and includes any subordinate legislation for the time being in force made under it.
|
1.4
|
Unless the context otherwise requires, a reference to one gender shall include a reference to the other genders.
|
1.5
|
Unless the context otherwise requires, words in the singular include the plural and in the plural include the singular.
|
1.6
|
The Schedule to this agreement forms part of (and is incorporated into) this agreement.
|
2.
|
TERM OF ENGAGEMENT
|
2.1
|
The Client shall engage the Advisor to provide the Services on the terms of this agreement.
|
2.2
|
The Engagement shall commence on the Commencement Date and shall continue, subject to the remaining terms of this agreement, until twelve months from the date hereof with the parties having the option to mutually agree to extend such term upon the satisfactory completion of the Services, unless terminated earlier:
|
(a)
|
as provided for by the terms of this agreement; or
|
(b)
|
by either party giving to the other not less than two weeks’ written notice.
|
3.
|
DUTIES AND OBLIGATIONS
|
3.1
|
During the Engagement the Advisor shall:
|
(a)
|
provide the Services in accordance with the terms specified in the Schedule to this agreement;
|
(b)
|
provide the Services with all due care, skill and ability and use his reasonable endeavours to promote the interests of the Client and any Group Company;
|
(c)
|
devote up to 33 (thirty-three) days in each calendar quarter to the carrying out of the Services, together with such additional time (if any) as may be necessary for their proper performance; and
|
(d)
|
promptly give to the Client Representative all such information and reports as it may reasonably require in connection with matters relating to the provision of the Services or the Business of the Client or any Group Company.
|
3.2
|
If the Advisor is unable to provide the Services due to illness or injury, he shall advise the Client Representative of that fact as soon as reasonably practicable. For the avoidance of doubt, no fee
|
3.3
|
Unless he has been specifically authorised to do so by the Client Representative in writing:
|
(a)
|
the Advisor shall not have any authority to incur any expenditure in the name of or for the account of the Client; and
|
(b)
|
the Advisor shall not hold himself out as an employee, officer or agent of the Client and/or as having authority to bind the Client.
|
3.4
|
The Advisor shall comply with all reasonable standards of safety and comply with the Client's health and safety procedures from time to time in force at the premises where the Services are provided.
|
3.5
|
The Advisor shall comply with the following Client policies: Code of Ethics and Business Conduct, Insider Trading Policy, and Anti-corruption and Anti-bribery Policy.
|
3.6
|
The Advisor undertakes to the Client that, during the Engagement, he shall take all reasonable steps to offer (or cause to be offered) to the Client any Business Opportunities as soon as practicable after the same shall have come to his knowledge and in any event before the same shall have been offered by the Advisor (or caused by the Advisor to be offered) to any other party, provided that nothing in this clause shall require the Advisor to disclose any Business Opportunities to the Client if to do so would result in a breach by the Advisor of any obligation of confidentiality or of any fiduciary duty owed by it or him to any third party.
|
3.7
|
The Advisor shall comply with all applicable laws, regulations, codes and sanctions relating to anti-bribery and anti-corruption in connection with the provision of the Services, including but not limited to the Bribery Act 2010.
|
3.8
|
For the avoidance of doubt, the Client will not provide the Advisor with any equipment in connection with the provision of the Services unless agreed otherwise.
|
4.
|
FEES
|
4.1
|
The Client shall pay the Advisor a fee of £107,000 per quarter, such amount being exclusive of VAT.
|
4.2
|
On the last working day of each quarter during the Engagement, the Advisor shall submit to the Client Representative for approval an invoice for the amount of the fee payable (plus VAT, if applicable) for the Services during that quarter.
|
4.3
|
In consideration of the provision of the Services, the Client shall pay each invoice submitted by the Advisor in accordance with clause 4.2 within 5 business days of the Client Representative’s review and approval, such review not to be unreasonably delayed.
|
4.4
|
The Client shall be entitled to deduct from the fees (and any other sums) due to the Advisor any sums that the Advisor may owe to the Client or any Group Company at any time.
|
5.
|
EXPENSES
|
5.1
|
The Client shall not reimburse any expenses incurred by the Advisor in the course of the Engagement, other than with the prior approval of the Client Representative and subject to production of receipts or other appropriate evidence of payment.
|
5.2
|
If the Advisor is required to travel abroad in the course of the Engagement, he shall be responsible for any necessary insurances, inoculations and immigration requirements.
|
6.
|
OTHER ACTIVITIES
|
a)
|
such activity does not cause a breach of any of the Advisor's obligations under this agreement; and
|
b)
|
the Advisor shall not engage in any such activity if it relates to a business which is similar to or in any way competitive with the Business of the Client or any Group Company without the prior written consent of the Client Representative.
|
7.
|
CONFIDENTIAL INFORMATION AND CLIENT PROPERTY
|
7.1
|
The Advisor acknowledges that, in the course of the Engagement, he will have access to Confidential Information. The Advisor has therefore agreed to accept the restrictions in this clause 7.
|
7.2
|
The Advisor shall not (except in the proper course of his duties), either during the Engagement or at any time after the Termination Date, use or disclose to any third party (and shall use his best endeavours to prevent the publication and disclosure of) any Confidential Information. This restriction does not apply to:
|
(a)
|
any use or disclosure authorised by the Client or required by law; or
|
(b)
|
any information which is already in, or comes into, the public domain otherwise than through Advisor's unauthorised disclosure.
|
7.3
|
At any stage during the Engagement, the Advisor will on request as soon as is reasonably practicable return to the Client all and any Client Property in his possession.
|
8.
|
DATA PROTECTION
|
8.1
|
The Advisor consents to the Client holding and processing data relating to him for legal, personnel, administrative and management purposes and, in particular, to the processing of any
|
(a)
|
information about his physical or mental health or condition in order to monitor sickness absence;
|
(b)
|
his racial or ethnic origin or religious or similar beliefs in order to monitor compliance with equal opportunities legislation; and
|
(c)
|
information relating to any criminal proceedings in which he has been involved for insurance purposes and in order to comply with legal requirements and obligations to third parties.
|
8.2
|
The Advisor consents to the Client making such information available to any Group Company, those who provide products or services to the Client and any Group Company such as advisers, regulatory authorities, governmental or quasi-governmental organisations and potential purchasers of the Client or the Group or any part of its business.
|
8.3
|
The Advisor consents to the transfer of such information to the Client's and any Group Company's business contacts outside the European Economic Area in order to further their business interests.
|
8.4
|
The Advisor shall comply with the Client's data protection policy and relevant obligations under the Data Protection Act 1998 and associated codes of practice when processing personal data relating to any employee, worker, customer, client, supplier or agent of the Client.
|
9.
|
INTELLECTUAL PROPERTY
|
9.1
|
The Advisor warrants to the Client that he will comply with the Client’s policies and procedures in respect of intellectual property.
|
10.
|
LIABILITY
|
10.1
|
The Advisor shall have liability for, and shall indemnify the Client and any Group Company for any direct loss, liability, costs (including reasonable legal costs), damages or expenses, but excluding indirect or consequential losses, loss of profit and loss of reputation arising from any breach by the Advisor of the terms of this agreement, including any negligent or reckless act, omission or default in the provision of the Services.
|
10.2
|
The Advisor’s maximum liability under the indemnity in clause 10.1 shall be limited to a total of £100,000 in respect of all acts and/or omissions occurring within the term of the Engagement other than resulting from fraud, wilful breach or gross negligence by the Advisor.
|
11.
|
TERMINATION
|
11.1
|
Notwithstanding the provisions of clause 2.2, the Client may terminate the Engagement with immediate effect without notice and without any liability to make any further payment to the
|
(a)
|
commits any serious or repeated breach or non-observance of any of the provisions of this agreement or refuses or neglects to comply with any reasonable and lawful directions of the Client in connection with the provision of the Services;
|
(b)
|
is convicted of any criminal offence (other than an offence under any road traffic legislation in the United Kingdom or elsewhere for which a fine or non-custodial penalty is imposed);
|
(c)
|
is declared bankrupt or makes any arrangement with or for the benefit of his creditors or has a county court administration order made against him under the County Court Act 1984;
|
(d)
|
commits any fraud or dishonesty or acts in any manner which, in the opinion of the Client, brings or is likely to bring the Advisor or the Client or any Group Company into disrepute or is materially adverse to the interests of the Client or any Group Company;
|
(e)
|
commits any breach of the Client's policies and procedures that have been notified to the Advisor as applying to him in connection with the provision of the Services; or
|
(f)
|
commits any offence under the Bribery Act 2010.
|
11.2
|
The rights of the Client under clause 11.1 are without prejudice to any other rights that it might have at law to terminate the Engagement or to accept any breach of this agreement on the part of the Advisor as having brought the agreement to an end. Any delay by the Client in exercising its rights to terminate shall not constitute a waiver of these rights.
|
12.
|
OBLIGATIONS ON TERMINATION
|
(a)
|
deliver to the Client all Client Property which is in his possession or under his control; and
|
(b)
|
to the extent possible, delete any information relating to the Business of the Client or any Group Company stored on any magnetic or optical disk or memory and all matter derived from such sources which is in his possession or under his control outside the premises of the Client.
|
12.2
|
The Client shall ensure that all monies due and payable to the Advisor in respect of the provision of the Services, together with any expenses incurred by the Advisor in accordance with clause 5, are paid in full within 10 days of the Termination Date.
|
13.
|
STATUS
|
13.1
|
The relationship of the Advisor to the Client will be that of independent contractor and nothing in this agreement shall render him an employee, worker, agent or partner of the Client and the Advisor shall not hold himself out as such.
|
13.2
|
This agreement constitutes a contract for the provision of services and not a contract of employment and, accordingly, the Advisor shall be fully responsible for any income tax, National Insurance and social security contributions and any other liability, deduction, contribution, assessment or claim arising from or made in connection with either the performance of the Services or any payment or benefit received by the Advisor in respect of the Services, where such recovery is not prohibited by law.
|
13.3
|
The Advisor shall further indemnify the Client against all reasonable costs, expenses and any penalty, fine or interest incurred or payable by the Client in connection with or in consequence of any such liability, deduction, contribution, assessment or claim.
|
14.
|
NOTICES
|
14.1
|
Any notice given under this agreement shall be in writing and signed by or on behalf of the party giving it and shall be served by delivering it personally, or sending it by pre-paid recorded delivery or registered post to the relevant party at its registered office for the time being. Any such notice shall be deemed to have been received:
|
(a)
|
if delivered personally, at the time of delivery; or
|
(b)
|
in the case of pre-paid recorded delivery or registered post, 48 hours from the date of posting.
|
14.2
|
In proving such service, it shall be sufficient to prove that the envelope containing such notice was addressed to the address of the relevant party and delivered either to that address or into the custody of the postal authorities as a pre-paid recorded delivery or registered post.
|
15.
|
ENTIRE AGREEMENT
|
16.
|
VARIATION
|
17.
|
COUNTERPARTS
|
18.
|
THIRD PARTY RIGHTS
|
18.1
|
Except as expressly provided elsewhere in this agreement, a person who is not a party to this agreement shall not have any rights under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this agreement but this does not affect any right or remedy of a third party which exists, or is available, apart from under that Act.
|
18.2
|
The rights of the parties to terminate, rescind or agree any variation, waiver or settlement under this agreement is not subject to the consent of any person that is not a party to this agreement.
|
19.
|
FORCE MAJEURE
|
19.1
|
Neither party shall be deemed to be in breach of this agreement by reason of any delay in performing, or any failure to perform, any of their respective obligations in relation to this agreement, if the delay or failure was due to any cause beyond its reasonable control, including but not limited to acts of God, explosions, floods, fire or accident, war or threat of war, terrorism or threat of terrorism, sabotage, civil disturbance, prohibitions or measures of any kind on the part of any governmental, parliamentary or local authority, import or export regulations or embargoes, or industrial actions or trade disputes (whether involving employees of either party or of a third party).
|
20.
|
GOVERNING LAW AND JURISDICTION
|
20.1
|
This agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales.
|
20.2
|
The parties irrevocably agree that the courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this agreement or its subject matter or formation (including non-contractual disputes or claims).
|
1.
|
The Advisor shall provide the Services detailed in this Schedule.
|
2.
|
The Services shall be provided to the Client at such times and from such locations as the Advisor shall determine in his reasonable discretion are appropriate.
|
3.
|
The Advisor is not subject to the control of the Client in relation to the provision of the Services.
|
4.
|
The Services shall comprise:
|
•
|
Providing the CEO with strategic advice regarding the Client’s international operations;
|
•
|
Providing such other strategic advice as agreed between the Client Representative and Advisor.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|||||||||||||||||||
|
|
Year Ended December 31,
|
|
March 31,
|
||||||||||||||||||||||||||||||||
|
|
2012
|
|
|
2013
|
|
|
2014
|
|
|
2015
|
|
|
2016
|
|
|
2016
|
|
|
2017
|
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
|
Income from Continuing Operations before Provision (Benefit) for Income Taxes and Gain on Sale of Real Estate
|
$
|
296,805
|
|
|
|
$
|
159,871
|
|
|
|
$
|
223,373
|
|
|
|
$
|
162,066
|
|
|
|
$
|
146,644
|
|
|
|
$
|
74,941
|
|
|
|
$
|
68,064
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
|
Gain on Sale of Real Estate (1)
|
261
|
|
|
|
1,847
|
|
|
|
10,512
|
|
|
|
1,059
|
|
|
|
2,310
|
|
|
|
—
|
|
|
|
—
|
|
|
||||||||
|
Fixed Charges
|
326,261
|
|
|
|
335,637
|
|
|
|
345,781
|
|
|
|
344,606
|
|
|
|
417,774
|
|
|
|
88,149
|
|
|
|
116,077
|
|
|
||||||||
|
|
$
|
623,327
|
|
|
|
$
|
497,355
|
|
|
|
$
|
579,666
|
|
|
|
$
|
507,731
|
|
|
|
$
|
566,728
|
|
|
|
$
|
163,090
|
|
|
|
$
|
184,141
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Interest Expense, Net
|
$
|
242,599
|
|
|
|
$
|
254,174
|
|
|
|
$
|
260,717
|
|
|
|
$
|
263,871
|
|
|
|
$
|
310,662
|
|
|
|
$
|
67,062
|
|
|
|
$
|
86,055
|
|
|
|
|
Interest Portion of Rent Expense
|
83,662
|
|
|
|
81,463
|
|
|
|
85,064
|
|
|
|
80,735
|
|
|
|
107,112
|
|
|
|
21,087
|
|
|
|
30,022
|
|
|
||||||||
|
|
$
|
326,261
|
|
|
|
$
|
335,637
|
|
|
|
$
|
345,781
|
|
|
|
$
|
344,606
|
|
|
|
$
|
417,774
|
|
|
|
$
|
88,149
|
|
|
|
$
|
116,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Ratio of Earnings to Fixed Charges
|
1.9
|
|
x
|
|
1.5
|
|
x
|
|
1.7
|
|
x
|
|
1.5
|
|
x
|
|
1.4
|
|
x
|
|
1.9
|
|
x
|
|
1.6
|
|
x
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
(1) Gain on sale of real estate reported above are pre-tax. The tax associated with the gain on the sale of real estate for the years ended December 31, 2012, 2013, 2014, 2015 and 2016 and for the three months ended March 31, 2016 and 2017 was $55, $430, $2,205, $209, $130, $0 and $0, respectively.
|
||||||||||||||||||||||||||||||||||||
1.
|
I have reviewed this quarterly report on Form 10-Q of Iron Mountain Incorporated;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/ WILLIAM L. MEANEY
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William L. Meaney
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President and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of Iron Mountain Incorporated;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/ STUART B. BROWN
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Stuart B. Brown
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Executive Vice President and Chief Financial Officer
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|
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/s/ WILLIAM L. MEANEY
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|
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William L. Meaney
|
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President and Chief Executive Officer
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|
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/s/ STUART B. BROWN
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Stuart B. Brown
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Executive Vice President and Chief Financial Officer
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