{"id":5678,"date":"2015-02-09T07:30:07","date_gmt":"2015-02-09T13:30:07","guid":{"rendered":"http:\/\/news.medill.northwestern.edu\/chicago\/?p=5678"},"modified":"2015-02-09T07:30:07","modified_gmt":"2015-02-09T13:30:07","slug":"stericycle-sustains-revenue-growth-but-stock-falls","status":"publish","type":"post","link":"https:\/\/news.medill.northwestern.edu\/chicago\/stericycle-sustains-revenue-growth-but-stock-falls\/","title":{"rendered":"Stericycle sustains revenue growth; but stock falls"},"content":{"rendered":"

by Jin Wu<\/p>\n

Stericycle Inc.<\/a> (NASDAQ: SRCL<\/a>), the Illinois-based world\u2019s largest provider of regulated medical waste management, reported<\/a> higher profits in both the fourth quarter and the year 2014 due to its successful acquisition strategy.<\/p>\n

For the quarter ended December 31, Stericycle earned $82.5 million, or 96 cents per diluted share, compared with $78.2 million, or 90 cents per diluted share, in the year-earlier quarter. However, the diluted EPS missed the $1.12 consensus estimate of seven analysts, and the stock dropped 2.48 percent.<\/p>\n

On an adjusted basis, which excluded elements such as acquisition and restructuring expenses, the company earned $1.12 per diluted share, up from 99 cents per diluted share, in the year-earlier quarter, equalling the consensus estimate of $1.12 by 16 analysts.<\/p>\n

In the fourth quarter, revenues increased 19.2 percent to $676.9 million from $567.9 million.<\/p>\n

\"Stericycle<\/a><\/p>\n

For the 2014 fiscal year, Stericycle\u2019s net income climbed 4.8 percent to $326.5 million from $311.4 million. Earnings per diluted share increased to $3.79 from $3.56, missing the consensus estimate of $3.95 per diluted share. Adjusted diluted EPS increased to $4.27 from $3.75, topping the consensus estimate of $4.26.<\/p>\n

Full year 2014 revenues were $2.56 billion, up 19.3 percent from $2.14 billion.<\/p>\n

Acquisitions greatly contributed to Stericycle\u2019s fourth-quarter and full year performance. \u201cIn the quarter, we closed nine acquisitions, five domestic and four international. The revenues from the nine acquisitions were $7 million in the quarter and annualized approximately $43 million,\u201d said Brent Arnold<\/a>, chief operating officer of Stericycle, in the conference call. According to the press release<\/a>, combined with previously completed acquisitions, total \u2028acquired revenue growth was $93.1 million in the fourth quarter.<\/p>\n

\u201cIn 2014, we expanded our international operations completing 27 acquisitions in 10 countries including a new geography — South Korea,\u201d Arnold said.<\/p>\n

Al Kaschalk, analyst at Wedbush Inc.<\/a>, said because the majority of the acquisitions were executed internationally, volatility in foreign currencies became an inevitable factor influencing Stericycle\u2019s earnings. In the press release, the management stated that there was unfavorable foreign exchange impact of $17.0 million in the fourth quarter and $33.6 million in the full year.<\/p>\n

However, strong international growth offset the foreign-exchange headwind. Morningstar Inc.<\/a> analyst Barbara Noverini said: \u201cI think Stericycle just showed that their expansion strategy continued to work. That\u2019s especially true with the strong internal growth rate that they posted to their international segment. It\u2019s clear to me that all the acquisition they\u2019ve been doing internationally, including some of the services they\u2019ve managed to overlap the existing footprint internationally, are working because we start to see internal growth rate strengthened even further.\u201d Stericycle\u2019s international revenues were up 19.3 percent in 2014 and the company anticipates an internal growth rate of 6 to 9 percent in international markets in 2015.<\/p>\n

\"Although<\/a>
Although the price of oil has decreased dramatically in the past six months, the price of diesel, which is the key energy for Stericycle\u2019s transit fleet, didn\u2019t start to decline sharply until December. Analysts from William Blair & Co. expect this would benefit Stericycle\u2019s current quarter profits. (U.S. Energy Information Administration, Jin Wu\/Medill)<\/figcaption><\/figure>\n

For 2015, Stericycle lowered its expectation of diluted EPS to $4.63 to $4.69 per share, to account for the foreign-exchange impact. According to William Blair & Co.<\/a>\u2019s estimation, currency is expected to reduce total 2015 revenue by about $70 million.<\/p>\n

However, William Blair & Co. expects diesel price declines would benefit Stericycle\u2019s margins modestly in early 2015.<\/p>\n

The stock dropped to $131.62, down $3.35.<\/p>\n

Photo at top: Stericycle Inc., world’s largest provider of medical waste management solutions, reported higher profits in the fourth quarter and 2014 due to successful acquisition strategy. (Stericycle Inc.)<\/div>\n","protected":false},"excerpt":{"rendered":"

by Jin Wu Stericycle Inc. (NASDAQ: SRCL), the Illinois-based world\u2019s largest provider of regulated medical waste management, reported higher profits in both the fourth quarter and the year 2014 due to its successful acquisition strategy. For the quarter ended December 31, Stericycle earned $82.5 million, or 96 cents per diluted share, compared with $78.2 million, […]<\/p>\n","protected":false},"author":35,"featured_media":5683,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27,243],"tags":[],"class_list":["post-5678","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-winter-2015"],"yoast_head":"\nStericycle sustains revenue growth; but stock falls - Medill Reports Chicago<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/news.medill.northwestern.edu\/chicago\/stericycle-sustains-revenue-growth-but-stock-falls\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Stericycle sustains revenue growth; but stock falls - Medill Reports Chicago\" \/>\n<meta property=\"og:description\" content=\"by Jin Wu Stericycle Inc. (NASDAQ: SRCL), the Illinois-based world\u2019s largest provider of regulated medical waste management, reported higher profits in both the fourth quarter and the year 2014 due to its successful acquisition strategy. 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