Stericycle, Inc. Q2 2013 NASDAQ: SRCL Forward - Looking Statements - - PDF document

Stericycle, Inc. – Q2 2013

NASDAQ: SRCL

Forward - Looking Statements

This presentation may contain forward-looking statements that involve a number of risks and uncertainties and our actual results could differ significantly from expected results. Potential risks and uncertainties include difficulties in completing the integration of acquired businesses, changes in governmental regulation of medical waste collection and treatment, and increases in transportation and other operating costs, as well as various other factors described in our public filings with the U.S. Securities and Exchange Commission. Accordingly, past financial performance should not be considered a reliable indicator of future performance, and historical trends should not be used to anticipate future trends or results. For a definition of terms used throughout this presentation please see the last page on our website presentation.

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Competitive Strengths

Broad range of high quality services

Regulated Waste Services Steri-Safe

SM Safety & Compliance Program

Sharps Management Service Pharmaceutical Waste Disposal Patient Communication Services Recall and Returns Management Services

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Market Leadership

Total Estimated Global Market Size: $15 billion*

Note: * Frost & Sullivan Industry Study and Management Estimates (including ancillary services & products)

Stericycle 14% Onsite Management and Other Competitors 86%

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Regulated Waste Services

Compliant management of regulated waste to reduce cross contamination risk and spread of infection Necessary Regulated Service Large Diverse Customer Base Worldwide Market Opportunity Growing portfolio of services Low Cost Operator Attractive Margins

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Loyal Customer Base

Highly regulated industry

(e.g. U.S. Market: EPA, DEA, FDA, OSHA, DOT, State/Local. Intl: similar agencies)

Insulated from economic cycles 550,000 accounts (granularity). Revenue retention exceeds 95%

Hospitals, Blood banks, Pharmaceutical manufacturers, Medical and Dental offices, Offsite and alternate care providers, Biomedical/Biotech companies, Laboratories/Pharmacies, Corporate America, Retail Locations, Veterinary offices

Largest customer less than 2% of revenues Predictable revenues: over 95% of revenues are under long term contracts with automatic renewal Contracts generally include pass through price increase provisions

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Network of Premier Assets

International Presence

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Collection/Transfer Processing Facilities

Integrated Network

Growth Strategy

Focus on small regulated waste customers Leverage Steri-Safe

SM OSHA Safety & Compliance Program

Expand Sharps Management Service Program Expand Pharmaceutical Waste Disposal Program Grow Patient Communication Services Grow Regulated Recall and Returns Management Services Target “tuck-in” strategic acquisitions International growth and geographic expansion

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Focus on Small Customers

Small account customers generate gross margins higher than large account customers Small account customers are more likely to outsource and are easier to up-sell

Small Account Customers 33% Large Account Customers 67%

45.2% Gross Margin 21.0% Gross Margin

* Note: Domestic SQ and LQ Revenue Mix

Q4 1996 % Revenue Mix* Q2 2013

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Large Account Customers, 37% Small Account Customers, 63%

Steri-Safe

SM OSHA Safety &

Compliance Program

Promotes a safe and compliant workplace for healthcare employees

Compliance Manual MyStericycle.com Consulting Services Medical Waste Disposal

Subscription Safety Tools Attractive Margins Significant Penetration and Up-sell Opportunities International Expansion

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Sharps Management Service

Promotes a safer workplace by reducing the infection risk from inadvertent needle sticks and supports sustainability efforts Turnkey Integrated Sharps Safety Solution Synergy with Existing Transportation & Plant Infrastructure

Use of Product in Hospital Manage & Collect Reusable Sharps Containers

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Pharmaceutical Waste Disposal

Promotes a compliant workplace by proper handling, segregation, transportation and disposal of pharmaceutical waste to keep drugs out of the water supply Turnkey Integrated Pharmaceutical Waste Management System Synergy with Existing Infrastructure

Use of Product in Hospital Training Protects the Environment 12

Patient Communication Services

Live voice telephone answering service, automated appointment reminders, appointment scheduling, physician referrals, post discharge and wellness calls Essential service for current customer base Serving medical offices, clinics, community care centers and hospitals Recurring revenue model Leverages Recall call center expertise

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LQ/SQ Opportunity

$15k - $20k $35k - $40k $35k - $40k $30k - $35k

LQ – Hospital Example SQ – Doctor Practice Example Hazardous Waste Rx Waste Sharps

Management

Med Waste

Revenue Range

Patient Communication

• Secure Messaging
• Automated

Reminder

• After Hours

$6.3k - $8.8k

Revenue Range

$1.2k - $1.5k $1.0k - $1.2k

Steri•Safe

SM

Total Revenue Opportunity $115k - $135k 4x Current Med Waste Revenue Total Revenue Opportunity $8k - $11k 9x Current Med Waste Revenue

Med Waste

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Recall and Returns Management Services

Remove expired or unsafe products from supply chain to reduce risk and protect the brand Notification, returns and recall solutions for pharmaceuticals, medical devices, consumer products and food industry Serving manufacturers, hospitals, distributors, retail pharmacies

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Acquisitions

Proven integrator having successfully completed 323 acquisitions since 1993 Current Worldwide acquisition pool represents more than $100 million in revenues Purchase price is based on IRR/multiples

• f EBITDA and depends on the risk and

quality of the assets purchased

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Stericycle continues to exhibit steady top-line revenue growth

Fiscal Year Ended December 31

Strong Financial Performance Revenues

($ in millions)

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1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 YTD Q2 12 YTD Q2 13 $67 $133 $324 $359 $402 $453 $516 $610 $790 $933 $1,084 $1,178 $1,439 $1,676 $1,913 $929 $1,040

Strong Financial Performance Income from Operations (EBIT)*

Fiscal Year Ended December 31

2000-2001: Adjusted for pro-forma adoption of new accounting standards to cease amortization of goodwill. 2006-2013: Includes expensing of stock compensation. 2000-2013: Excludes integration related costs, write-off of fixed assets and other non-operational items. 2009-2013: Excludes expenses associated with acquisitions/business combinations.

($ in millions)

GAAP EBIT $ and EBIT to REVENUE %

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1998 $6 9.6% 1999 $12 9.3% 2000 $63 23.2% 2001 $73 23.6% 2002 $101 25.1% 2003 $126 27.9% 2004 $146 28.2% 2005 $167 27.3% 2006 $202 25.6% 2007 $225 24.1% 2008 $274 25.3% 2009 $315 26.8% 2010 $371 25.8% 2011 $424 25.3% 2012 $469 24.5% YTD Q2-12 $234 25.2% YTD Q2-13 $265 25.5% $6 $12 $75 $88 $104 $126 $147 $167 $202 $240 $280 $325 $391 $444 $499 $242 $272

Strong Financial Performance EPS**

Stericycle has met or exceeded EPS estimates since 1996 IPO

Fiscal Year Ended December 31

**Note: Adjusted for 2-for-1 stock split in May 2002 and in May 2007. *Note: Non-GAAP EPS is adjusted for: Acquisition and integration related costs, bond buyback premium & bank loan financing fees, tax adjustment to fully taxed, non-cash fixed assets write-offs, legal settlements, non-cash write-down of investments, goodwill amortization pre-2002, insurance proceeds, note receivable write-down, gain on divestiture of assets, impairment of intangible assets, restructuring costs. Expensing of stock compensation is NOT part of the adjustments.

($ in millions)

GAAP EPS 19

1998 $0.13 1999 $0.23 2000 $0.18 2001 $0.17 2002 $0.51 2003 $0.71 2004 $0.85 2005 $0.74 2006 $1.16 2007 $1.32 2008 $1.68 2009 $2.03 2010 $2.39 2011 $2.69 2012 $3.08 YTD Q2-12 $1.53 YTD Q2-13 $1.74 $0.09 $0.15 $0.30 $0.37 $0.54 $0.73 $0.89 $1.05 $1.18 $1.43 $1.74 $2.10 $2.55 $2.88 $3.34 $1.60 $1.81

Capitalization

*Common Equity is defined as Total Shareholders’ Equity less noncontrolling interests.

($ in millions)

• Dec. 31, 2000
• Dec. 31, 2012
• Jun. 30, 2013

Current Portion of Long Term Debt $5.1 $87.8 $72.4 Revolver $5.0 $225.9 $206.1 Term Loan $208.0 $0.0 $0.0 Private Placement $0.0 $750.0 $750.0 Other Debt $7.1 $292.4 $290.1 Senior Subordinated Notes $125.0 $0.0 $0.0 Total Long Term Debt, Less Current Portion $345.1 $1,268.3 $1,246.2 Convertible PIK Preferred Stock $71.4 $0.0 $0.0 Common Equity* $134.7 $1,541.8 $1,632.0 Total Capitalization $556.3 $2,897.9 $2,950.6 Debt to EBITDA 3.86X 2.24X 2.09X

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Investment Highlights

Attractive broad range of niche services Emerging global market Low cost provider Diverse customer base Strong financial performance and strong free cash flow Demonstrated growth strategy Successful in integrating acquisitions and improve margins Proven, experienced management team

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Stericycle, Inc.

NASDAQ: SRCL

Definition of Terms

This presentation uses certain abbreviations: CAGR means compound annual growth rate EBIT means earnings before interest expense and income taxes EPS means earnings per share diluted GAAP means United States generally accepted accounting principles LQ refers to a Large Account customer SQ refers to a Small Account customer Free Cash Flow means cash from operations less capital expenditures

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