2. 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 page 20 on our website presentation.
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3. Competitive Strengths
Broad range of high quality services
g gq y
• Regulated Medical Waste Services
• Steri-SafeSM OSHA Safety & Compliance Program
Steri Safe
• Bio Systems Integrated Sharps Safety Solution
• Regulated Returns Management Services
2
4. Protecting People, Reducing Risk
We work with our customers to
Protect People and Reduce Risk …
… b combining integrated solutions with
by bi i i t t d l ti ith
superior customer service to promote safety,
compliance and risk management for our
customers
3
5. Investment Highlights
Attractive niche services
Emerging global market
Low cost provider
Diverse customer base
Strong financial p
g performance
Demonstrated growth strategy
Proven ability to integrate acquisitions and improve
margins
Proven,
Proven experienced management team
4
6. Market Leadership
Total Estimated Global Market Size: $10.0 billion*
Stericycle
y
11% Onsite
Management &
Other
Competitors
89%
Note: * Frost & Sullivan Industry Study and Management Estimates (including ancillary services & products)
5
7. Regulated Medical Waste Services
Necessary Regulated Service
Compliant management of
Large Diverse Customer Base
potentially infectious material to
Int’l Network Premier Assets
reduce cross contamination risk
Low Cost Operator
and spread of infection
Attractive Margins
International Expansion
I t ti lE i
6
8. Loyal Customer Base
Highly regulated industry
(g
(e.g. U.S. Market: EPA, DEA, FDA, OSHA, DOT, State/Local)
)
Insulated from economic cycles
420,000 accounts (granularity). Revenue retention exceeds 95%
Hospitals, Bl d b k Ph
H it l Blood banks, Pharmaceutical manufacturers, M di l and
ti l ft Medical d
Dental offices, Offsite and alternate care providers,
Biomedical/Biotech companies, Laboratories/Pharmacies, Corporate
America, Veterinary offices, Pharmacies
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
7
9. Network of Premier Assets
Emerging Global Presence North America Network
8
10. Growth Strategy
Focus on small account customers
Leverage Steri-SafeSM OSHA Safety & Compliance
Program
Expand Bio Systems Integrated Sharps Safety
Solution
Grow Regulated Return Management Services
Target “tuck-in” strategic acquisitions
International growth and geographic expansion
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11. Focus on Small Customers
Small account customers generate gross margins higher
than large account customers
Small account customers are more likely to outsource and
easier to up-sell
Q4 1996 Q1 2009
% Revenue Mix*
Small
Account
Large Large Account
Customers Customers
Account Small Account
33% 37%
Customers Customers
63%
67%
21.0% Gross Margin 46.1% Gross Margin
10
* Note: Domestic SQ and LQ Revenue Mix
12. SM
Steri-Safe OSHA Safety &
Compliance Program
g
Subscription Safety Tools
Promotes a safe, compliant
workplace for healthcare
Attractive Margins
employees
Significant Penetration and
Up-sell Opportunities
International Expansion
Consulting Services Safety Products
Compliance Manual SteriSafe.com
& Supplies
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13. Bio Systems Integrated
Sharps Safety Solution
Turnkey Integrated
Promotes a safer workplace by
Sharps Safety Solution
reducing the infection risk from
inadvertent needle sticks
Synergy with Existing
Transportation & Plant
Infrastructure
Use of Product in Hospital Manage & Collect at Point of Use
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14. Returns Management Services
Data-driven notification,
Remove expired or unsafe
recall and returns solutions
products from supply chain to
for pharmaceuticals, medical
reduce risk
devices & durable goods
Serving manufacturers,
hospitals & retail pharmacies,
distributors
13
15. Acquisitions
Proven integrator having successfully completed 160
acquisitions since 1993
Current North American acquisition pool represents more
than $50 million in revenues
Deal structures are predominantly asset purchases
Purchase price is based on multiples of EBITDA and depend
on the quality of the asset base purchased
14
17. Strong Financial Performance
Income from Operations (EBIT*)
( )
Fiscal Year Ended December 31
$274.2
$
$224.5
($ in millions) $201.8
$166.5
$145.7
$126.4
$
$100.8
$84.9
$75.1
$59.5 $74.2
$12.3
$6.4
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Q108 Q109
Margin: 9.6% 9.3% 23.2% 23.6% 25.1% 27.9% 28.2% 27.3% 25.6% 24.1% 25.3% 23.3% 26.8%
Stericycle has effectively leveraged its infrastructure to improve margins
* 2000-2001: Adjusted for p
j pro-forma adoption of FAS 142.
p
•* 2006-2009: Includes FAS123R expensing of stock compensation.
•* 2000-2009: Includes acquisition related costs, write-off of fixed assets and other non-GAAP adjustments.
•* 2009: Includes FAS 141R transactional costs associated with acquisitions/business combinations
16
18. Strong Financial Performance
EPS**
Fiscal Year Ended December 31 $0.05
$0.10
$0.00
$0.03
$0.30
$0.02
$ $1.68
$1 68
$1.32
$0.03
$1.16
$0.04 $0.00
$0.85
$0.74
$0.71
$0.12 $0.20 $0.51 $
$0.35 $0 47
$0.47
$0.23 $0.18$0.17
$0.13
‐$0.08
‐$0.04
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Q108 Q109
Stericycle has met or exceeded EPS estimates since 1996 IPO
**Note: Adjusted for 2-for-1 stock split in May 2002 and again in May 2007. Adjustments to GAAP EPS: Acquisition related costs
(1999-2000); Bond buyback premium & bank loan financing fees (2001-2005); Tax adjustment to fully taxed (1999); Non cash fixed
assets write offs (2001- 2002 & 2004 2008); FAS142 (2000-2001); Licensing legal settlement refund (2005); Non cash write down of
write-offs (2001 2004-2008); (2000 2001); Non-cash write-down
investments (2005 & 2007); 3CI legal settlement & insurance proceeds (2005-2008); South African joint venture note receivable write-
down (2005); Australian arbitration settlement & related costs (2007-2008); Gain on divestiture of assets (2007); Impairment of
intangible assets (2007). FAS 141R transactional costs associated with acquisitions/business combinations (2009). FAS 123R
expensing of stock compensation is NOT part of the adjustments.
19. Capitalization
($ in millions) Dec. 31, Dec. 31, Dec. 31, Mar. 31,
2000 2007 2008 2009
Current Portion of Long Term Debt $5.1
$5 1 $22.0
$22 0 $38.9
$38 9 $39.6
$39 6
Revolver $5.0 $465.4 $439.8 $440.1
Term Loan A 67.5 0.0 0.0 0.0
Term Loan B 140.5 0.0 0.0 0.0
Other Debt 7.1 148.4 314.0 283.9
Senior Subordinated Notes 125.0
125 0 0.0
00 0.0
00 0.0
00
Total Long Term Debt, Less Current Portion $345.1 $613.8 $753.8 $724.0
Convertible PIK Preferred Stock 71.4 0.0 0.0 0.0
Common Equity 134.7 714.1 670.5 688.6
Total Capitalization $556.3 $1,349.9 $1,463.2 $1,452.2
18
20.
21. Definition of Terms
This presentation uses certain abbreviations:
CAGR means compound annual growth rate (see, for example,
page 15)
EBIT means earnings before interest expense and income taxes
(see page 16)
EPS means earnings per share diluted (see page 17)
FAS 142 means Financial Accounting Standard 142, Goodwill and
Other Intangible Assets, of the Financial Accounting Standards
Board (effective for 2003 and later years) (see page 17)
FAS 123R means Financial Accounting Standard 123R, accounting for
share based payments (see page 17)
GAAP means United States generally accepted accounting principles
FAS 141R means Financial Accounting Standard 141R, accounting for
business combinations (see page 17)
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