Iron Mountain Reports Second Quarter 2009 Financial Results

* Company delivers strong 10% OIBDA growth; results supported by solid core
revenue internal growth, gross margin gains and overhead cost controls

BOSTON, July 30 /PRNewswire-FirstCall/ -- Iron Mountain Incorporated (NYSE:
IRM), the global leader in information management services, today reported its
financial results for the second quarter ended June 30, 2009, announcing
strong reported operating income and operating income before depreciation and
amortization (OIBDA) growth of 11% and 10%, respectively, compared to the
second quarter of 2008. Excluding impacts from asset gains and losses,
operating income and OIBDA grew 13% and 11%, respectively, compared to the
prior year period. These results were supported by solid core revenue internal
growth of 6%, which more than offset forecasted weakness in complementary
service internal revenue growth. As expected, the significant year-over-year
weakening of major foreign currencies against the U.S. dollar led by the
British pound, the Euro and the Canadian dollar reduced the Company's reported
revenue and OIBDA by 7% compared to the second quarter of 2008. Driven by
increased cash flows from operations and modest capital expenditures, the
Company ended the quarter with greater liquidity comprised of cash and
availability under its revolving credit facility of more than $880 million.

"Iron Mountain's business remains healthy and on track towards strong full
year performance," said Bob Brennan, President and CEO. "We continue to post
solid results with performance trends similar to those we saw in the first
quarter. While economic factors are constraining top line growth, we continue
to drive strong OIBDA growth due to our disciplined management approach and
focus on execution, particularly in our North American Physical segment. "

Iron Mountain reported total internal revenue growth of 4% in the second
quarter compared to the prior year period supported by core revenue internal
growth of 6%. Solid storage revenue internal growth in the North American
Physical and International Physical business segments partially offset
pressures resulting from the severity of the recession on digital revenues and
activity-based revenues such as secure shredding. As expected, complementary
service revenues decreased year-over-year, due primarily to the completion of
a large special project in Europe, lower recycled paper prices and softness in
the more discretionary revenues such as project revenues and fulfillment
services. OIBDA of $217 million for the quarter was supported by higher gross
profit margins and continued focus on overhead cost controls. Included in
OIBDA for the second quarter is a benefit of $5 million resulting from certain
vehicle leases being classified as capital leases in 2009. These leases
previously met the requirements to be considered operating leases. This
benefit was included in the guidance originally issued by the Company on
February 26, 2009. See the appendices at the end of this press release for
Selected Financial Data, a discussion of non-GAAP measures and additional
information regarding the Company's results.

Net income attributable to Iron Mountain Incorporated (see Appendix A below)
for the quarter was $88 million, or $0.43 per diluted share, driven by higher
operating income and reduced interest expense. Earnings were further enhanced
by the strengthening of the Euro, Brazilian real and British pound versus the
U.S. dollar during the quarter, which resulted in $17 million of other income,
net as the Company marked its foreign currency forward contracts and non-U.S.
dollar denominated third party and intercompany debt to market. This net gain
includes both foreign currency gains and losses, which are incurred in
different tax jurisdictions. As a result, the Company recorded a $19 million
tax benefit. For the quarter, these gains increased earnings by $0.18 per
diluted share.

Key Financial Highlights - Q2 2009

Internal revenue growth for the second quarter was 4% as expected and core
revenue internal growth, while solid at 6%, was constrained on the margin by
economic pressures. The overall internal growth rate was impacted by the
continued softness in complementary service revenues as discussed above. The
significant year-over-year weakening of major foreign currencies including the
British pound, the Canadian dollar and the Euro reduced the revenue growth
rate by 7% compared to the second quarter of 2008. As a result, Iron Mountain
reported total consolidated revenues of $746 million for the quarter compared
to $769 million for the prior year period.

The Company reported gross profits of $433 million with its gross profit
margin improving from 54.9% in the second quarter of 2008 to 58.1% in the
second quarter of 2009. Gross margins were supported by improved storage
gross margin and productivity gains in North America as continued progress on
transportation and record center optimization initiatives drove higher service
gross margins. Gross margins also benefited from the sale of the low margin
data product sales business in June 2008 and from the recharacterization of
certain vehicle leases as described above.

OIBDA for the quarter was $217 million. OIBDA (excluding asset gains and
losses) grew 11% compared to the second quarter of 2008 including 3% growth
from the above referenced recharacterization of certain vehicle leases.
Excluding the impacts of the foreign currency exchange rate changes and the
lease recharacterization, second quarter OIBDA (excluding asset gains and
losses) grew approximately 14% compared to the prior year period. Selling,
general and administrative costs decreased 4% in the quarter on a reported
basis. Excluding the impacts of the foreign currency exchange rate changes,
these overhead costs increased 2%, below the rate of internal revenue growth
reflecting disciplined cost management.

Operating income for the second quarter of 2009 was $138 million, up 11%
compared to the same period in 2008. Excluding the impact of asset gains and
losses, second quarter operating income increased 13% compared to the prior
year period reflecting the flow through of OIBDA gains. Net income
attributable to Iron Mountain for the quarter was $88 million, or $0.43 per
diluted share, including pre-tax other income of $18 million, driven primarily
by foreign currency rate fluctuations.

The Company's effective tax rate before the impact of foreign currency rate
changes and other discrete items for the quarter was approximately 41%. The
net tax impact of the foreign currency rate fluctuations described above
reduced the effective tax rate by 26% and other discrete items reduced the
effective tax rate for the quarter by an additional 1%.

Capital expenditures incurred in the first six months of 2009 totaled $107
million, or 7.3% of revenues, excluding $9 million for the purchase of real
estate. The Company maintained tight control over capital spending and
continued to improve its capital efficiency. The Company has reiterated its
2009 capital spending outlook for total capital expenditures to be
approximately $380 million for the year.

The Company's Free Cash Flow before Acquisitions and Discretionary Investments
(FCF) for the six months ended June 30, 2009 was $121 million. Higher cash
flows from operating activities compared to the comparable prior year period
and controlled capital expenditures drove this improvement. As a result of
the increase in FCF and low level of acquisition spending in the quarter, the
Company further improved its liquidity position. As of June 30, 2009, the
Company had more than $880 million of liquidity including cash of $316 million
and availability under its revolving credit facility of $565 million. The
Company's consolidated leverage ratio of net debt to EBITDA (as defined by its
senior credit facility) was 3.6 times at June 30, 2009, well below the
covenant limitation of 5.5 times included in its senior credit facility. The
decrease since the end of 2007 illustrates the Company's ability to naturally
reduce its consolidated leverage ratio in the absence of significant
acquisition activity.

Acquisitions

The Company has not completed any acquisitions in 2009. Iron Mountain's
acquisition strategy focuses on acquiring attractive businesses that provide a
strong platform for future growth by expanding the Company's geographic
footprint and service offerings while enhancing its existing operations.

Financial Performance Outlook

For 2009, the Company continues to target solid underlying operating
performance supported by solid core revenue growth and sustained progress in
the North American Physical business segment through an ongoing focus on
execution. Based on internal growth trends in the first half of 2009, the
Company is adjusting its full year outlook to reflect expectations for 3% to
5% internal revenue growth. The Company's full year revenue guidance remains
in a similar range, as these impacts were offset by favorable changes in
estimated foreign exchange rates. The Company is increasing the low end of its
2009 OIBDA guidance range primarily to reflect foreign currency rate changes
and now expects OIBDA (excluding asset gains and losses) in the range of $830
million to $860 million. The significant year-over-year strengthening of the
U.S. dollar against the major currencies is expected to lower results reported
in U.S. dollars by approximately 5% in 2009. The Company's guidance for the
third quarter of 2009 set forth below includes a reduction of about 5% in both
revenue growth and OIBDA (excluding asset gains and losses) growth driven by
the strengthening U.S. dollar. In 2008, primarily due to a softening vehicle
resale market, certain vehicle leases that previously met the requirements to
be considered operating leases are now classified as capital leases. As a
result of the recharacterization of these leases, 2009 rent expense is
expected to decrease by approximately $20 million with an offsetting increase
to depreciation expense and interest expense. We expect this change to
provide a 3% benefit to the company's full year OIBDA (excluding asset gains
and losses) growth rate. This guidance is based on current expectations and
does not include the potential impact of any future acquisitions (dollars in
millions):
Quarter Full Year
Ending Ending % Growth
September 30, December 31, vs. 2008
2009 2009

Low High Low High FX As
Neutral Reported

Revenues $760 $780 $2,980 $3,040 3% - 5% (3)% - 0%
Operating Income 134 144 510 540
Depreciation &
Amortization ~81 ~320
OIBDA (excluding asset
gains and losses) 215 225 830 860 10% - 14% 5% - 9%
Capital Expenditures ~380

Iron Mountain's conference call to discuss its second quarter 2009 financial
results and third quarter and full year 2009 outlook will be held today at
8:30 a.m. Eastern Time. In order to further enhance the overall quality of
its investor communications, the Company will simulcast the conference call on
its Web site at www.ironmountain.com, the content of which is not part of this
earnings release. A slide presentation providing summary financial and
statistical information that will be discussed on the conference call will
also be posted to the Web site and available for real-time viewing. The slide
presentation and replays of the conference call will be available on the Web
site for future reference.

About Iron Mountain

Iron Mountain Incorporated (NYSE: IRM) helps organizations around the world
reduce the costs and risks associated with information protection and storage.
The Company offers comprehensive records management and data protection
solutions, along with the expertise and experience to address complex
information challenges such as rising storage costs, litigation, regulatory
compliance and disaster recovery. Founded in 1951, Iron Mountain is a trusted
partner to more than 120,000 corporate clients throughout North America,
Europe, Latin America and Asia Pacific. For more information, visit the
Company's Web site at www.ironmountain.com.

Forward Looking Statements

This press release contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and federal
securities laws, and is subject to the safe-harbor created by such Act.
Forward-looking statements include our 2009 financial performance outlook and
statements regarding our goals, beliefs, future growth strategies,
investments, objectives, plans and current expectations. These statements
involve known and unknown risks, uncertainties and other factors that may
cause the actual results to be materially different from those contemplated in
the forward-looking statements. Such factors include, but are not limited to:
(i) the cost to comply with current and future legislation, regulations and
customer demands relating to privacy issues; (ii) the impact of litigation
that may arise in connection with incidents in which we fail to protect the
Company's customers' information; (iii) changes in the price for the Company's
services relative to the cost of providing such services; (iv) changes in
customer preferences and demand for the Company's services; (v) in the various
digital businesses in which the Company is engaged, the cost of capital and
technical requirements, demand for the Company's services or competition for
customers; (vi) the Company's ability or inability to complete acquisitions on
satisfactory terms and to integrate acquired companies efficiently; (vii) the
cost or potential liabilities associated with real estate necessary for the
Company's business; (viii) the performance of business partners upon whom the
Company depends for technical assistance or management and acquisition
expertise outside the United States; (ix) changes in the political and
economic environments in the countries in which the Company's international
subsidiaries operate; (x) claims that the Company's technology violates the
intellectual property rights of a third party; (xi) other trends in
competitive or economic conditions affecting Iron Mountain's financial
condition or results of operations not presently contemplated; and (xii) other
risks described more fully in the Company's Current Report on Form 8-K under
"Item 1A. Risk Factors" filed on May 8, 2009. Except as required by law, Iron
Mountain undertakes no obligation to release publicly the result of any
revision to these forward-looking statements that may be made to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.

APPENDIX A

Selected Financial Data:

(dollars in millions,
except per share data)
Q2/ Q2/ Inc YTD/ YTD/ Inc
2008 2009 (Dec) 2008 2009 (Dec)
---- ---- ----- ---- ---- -----
Revenues $769 $746 (3)% $1,518 $1,469 (3)%

Gross Profit
(excluding D&A) $422 $433 3% $824 $840 2%
Gross Margin % 54.9% 58.1% 54.2% 57.1%

OIBDA (excluding
asset gains and losses) $196 $217 11% $375 $413 10%
OIBDA $197 $217 10% $373 $414 11%
OIBDA Margin % 25.6% 29.1% 24.5% 28.2%

Operating Income $124 $138 11% $230 $259 13%
Interest Expense, net $60 $55 (8)% $120 $111 (8)%

Provision for income taxes $25 $14 (45)% $43 $45 5%
Effective tax rate 41.0% 13.6% 38.2% 28.4%

Net Income Attributable
to Iron Mountain $36 $88 144% $69 $116 68%
EPS - Diluted $0.18 $0.43 $0.34 $0.57

Major Component of Other
Income (Expense), net:

Foreign Currency Exchange
Gains (Losses) $(3) $17 $3 $10

Q2/2009 YTD/2009
------- --------
Components of Revenue Growth:

Storage internal growth rate 6% 7%
Core service internal growth rate 5% 6%
---- ----
Core revenue internal growth rate 6% 7%
Complementary service internal
growth rate (6)% (11)%
---- -----
Total internal growth rate 4% 4%
Impact of acquisitions --% 1%
Impact of foreign currency
fluctuations (7)% (7)%
---- ----
Total revenue growth (3)% (3)%
---- ----

NOTE: Columns may not foot due to rounding.

The Company's internal growth rates represent the weighted average,
year-over-year growth rates of revenues excluding the effects of foreign
currency rate fluctuations and acquisitions.

The Company's core revenues are comprised of storage revenues plus core
service revenues. Included in core service revenues are revenues related to
the handling and transportation of items in storage and other recurring
revenue streams such as secure shredding service revenues, recurring project
revenues and maintenance fees associated with software license sales.

Included in the Company's complementary revenues are revenues associated with
ancillary services, such as special projects, public sector projects and
fulfillment services, along with revenues from the sale of recycled paper and
other products such as cardboard boxes and software licenses.
New Presentation of Net Income and Minority Interest (millions):

Three Months Six Months
Ended June 30, Ended June 30,
2008 2009 2008 2009
---- ---- ---- ----
Income Before Provision
for Income Taxes $61 $101 $113 $160
Provision for Income Taxes 25 14 43 45
---- ---- ---- ----
Net Income 36 88 70 114
Net Income (Loss) Attributable to
Noncontrolling Interests -- -- -- (2)
---- ---- ---- ----
Net Income Attributable
to Iron Mountain $36 $88 $69 $116
==== ==== ==== ====

NOTE: Columns may not foot due to rounding.

Effective January 1, 2009, Iron Mountain adopted SFAS No. 160, "Noncontrolling
Interests in Consolidated Financial Statements - an amendment to ARB 51" (SFAS
160). Among other things, SFAS 160 requires a change in the way minority
interest and net income are presented on the face of the statement of
operations. The table above shows the required presentation for the three and
six month periods ended June 30, 2008 and 2009. Please refer to the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2009 for
additional information related to SFAS 160.

APPENDIX B

Operating Income Before Depreciation and Amortization

Iron Mountain uses Operating Income Before Depreciation and Amortization
("OIBDA") as an integral part of its planning and reporting systems, to
evaluate the operating performance of the consolidated business. The Company
uses multiples of current and projected OIBDA in conjunction with its
discounted cash flow models to determine its overall enterprise valuation and
to evaluate acquisition targets. The Company believes OIBDA and OIBDA Margin
provide current and potential investors with relevant and useful information
regarding its ability to generate cash flow to support business investment and
its ability to grow revenues faster than operating expenses. OIBDA is not a
measurement of financial performance under accounting principles generally
accepted in the United States, or GAAP, and should not be considered as a
substitute for operating or net income or cash flows from operating activities
(as determined in accordance with GAAP).

Following is a reconciliation of OIBDA to operating income and net income
attributable to Iron Mountain Incorporated (in millions):

Three Months Six Months
Ended June 30, Ended June 30,
2008 2009 2008 2009
---- ---- ---- ----

OIBDA (excluding asset gains and losses) $196 $217 $375 $413
Less: Asset (Gains) Losses, net (1) 1 3 (1)
---- ---- ---- ----
OIBDA $197 $217 $373 $414
Less: Depreciation and Amortization 73 79 142 155
---- ---- ---- ----
Operating Income $124 $138 $230 $259
Less: Interest Expense, net 60 55 120 111
Other (Income) Expense, net 4 (18) (3) (11)
Provision for Income Taxes 25 14 43 45
---- ---- ---- ----
Net Income 36 88 70 114
Less: Noncontrolling Interests -- -- -- (2)
---- ---- ---- ----
Net Income Attributable to
Iron Mountain Incorporated $36 $88 $69 $116
==== ==== ==== ====

NOTE: Columns may not foot due to rounding.

Constant Currency Growth Rates

Three Months Ended Six Months Ended
June 30, 2009 June 30, 2009
------------- -------------
Constant Constant
As Reported Currency As Reported Currency
----------- -------- ----------- --------

Revenues (3)% 4% (3)% 4%
OIBDA (excluding asset
gains and losses) 11% 18% 10% 18%
OIBDA 10% 17% 11% 19%
Depreciation and
Amortization 8% 15% 9% 16%
Operating Income 11% 18% 13% 20%

Iron Mountain conducts business in 39 countries on five continents. As such,
a considerable amount of its revenues and expenses are denominated in foreign
currencies. In 2008, the U.S. dollar strengthened significantly against most
major foreign currencies. As such, the Company's international results were
reduced when translated into U.S. dollars. The table above shows the growth
rates of certain operating statement line items on an as reported basis as
well as on a constant currency basis. The constant currency growth rates are
calculated by translating the 2008 results at the 2009 average exchange rates.

Free Cash Flows before Acquisitions and Discretionary Investments, or FCF

FCF is defined as Cash Flows from Operating Activities less capital
expenditures (excluding real estate), net of proceeds from the sales of
property and equipment and other, net, and additions to customer acquisition
costs. Our management uses this measure when evaluating the operating
performance and profitability of our consolidated business. FCF is a useful
measure in determining our ability to generate cash flows in excess of our
capital expenditures (both growth and maintenance) and our customer
acquisition costs. As such, we believe this measure provides relevant and
useful information to our current and potential investors. FCF should be
considered in addition to, but not as a substitute for, other measures of
financial performance reported in accordance with GAAP, such as cash flows
from operating activities (as determined in accordance with GAAP).

Following is a reconciliation of Free Cash Flows before Acquisitions and
Discretionary Investments to Cash Flows from Operating Activities (in
millions):

Six Months Ended
June 30,
--------
2008 2009
---- ----

Free Cash Flows Before Acquisitions and
Discretionary Investments $20 $121
Add: Capital Expenditures
(excluding real estate), net 163 123
Additions to Customer Acquisition Costs 7 4
---- ----
Cash Flows From Operating Activities $190 $248
==== ====

NOTE: Columns may not foot due to rounding.

IRON MOUNTAIN INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands except Per Share Data)
(Unaudited)

Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2008 2009 2008 2009
---- ---- ---- ----
REVENUES:
Storage $416,195 $415,810 $820,512 $825,667
Service 352,662 330,218 697,729 643,707
------- ------- ------- -------

Total Revenues 768,857 746,028 1,518,241 1,469,374

OPERATING EXPENSES:
Cost of Sales (Excluding
Depreciation and
Amortization) 346,971 312,698 694,722 629,678
Selling, General and
Administrative 225,932 215,854 448,160 426,247
Depreciation and
Amortization 72,907 78,680 142,437 154,960
(Gain) Loss on Disposal /
Writedown of Property,
Plant and Equipment, Net (839) 742 2,706 (762)
----- ---- ----- ----

Total Operating Expenses 644,971 607,974 1,288,025 1,210,123
------- ------- --------- ---------

OPERATING INCOME 123,886 138,054 230,216 259,251

INTEREST EXPENSE, NET 59,757 55,175 119,776 110,696
OTHER EXPENSE (INCOME), NET 3,532 (18,394) (2,503) (11,239)
----- ------- ------ -------

Income Before Provision
for Income Taxes 60,597 101,273 112,943 159,794

PROVISION FOR INCOME TAXES 24,859 13,761 43,131 45,338
------ ------ ------ ------
NET INCOME 35,738 87,512 69,812 114,456

Less: Net (Loss) Income
Attributable to the
Noncontrolling Interests (148) (126) 444 (1,981)
---- ---- ---- ------

Net Income Attributable to
Iron Mountain Incorporated $35,886 $87,638 $69,368 $116,437
======= ======= ======= ========

EARNINGS PER SHARE
- BASIC AND DILUTED:
NET INCOME ATTRIBUTABLE TO
IRON MOUNTAIN INCORPORATED
PER SHARE - BASIC $0.18 $0.43 $0.35 $0.58
===== ===== ===== =====
NET INCOME ATTRIBUTABLE TO
IRON MOUNTAIN INCORPORATED
PER SHARE - DILUTED $0.18 $0.43 $0.34 $0.57
===== ===== ===== =====

WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING - BASIC 200,855 202,502 200,863 202,284
======= ======= ======= =======
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING - DILUTED 203,038 204,199 203,229 203,755
======= ======= ======= =======

Operating Income before
Depreciation and
Amortization $196,793 $216,734 $372,653 $414,211
======== ======== ======== ========

IRON MOUNTAIN INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands)
(Unaudited)

December 31, June 30,
2008 2009
---- ----
ASSETS

CURRENT ASSETS:
Cash and Cash Equivalents $278,370 $316,056
Accounts Receivable (less allowances of
$19,562 and $22,718, respectively) 552,830 589,156
Other Current Assets 145,192 207,401
------- -------
Total Current Assets 976,392 1,112,613
------- ---------

PROPERTY, PLANT AND EQUIPMENT:
Property, Plant and Equipment at Cost 3,750,515 3,871,496
Less: Accumulated Depreciation (1,363,761) (1,484,180)
---------- ----------
Property, Plant and Equipment, net 2,386,754 2,387,316
--------- ---------

OTHER ASSETS:
Goodwill, net 2,452,304 2,449,457
Other Non-current Assets, net 541,404 523,113
------- -------
Total Other Assets 2,993,708 2,972,570
--------- ---------

Total Assets $6,356,854 $6,472,499
========== ==========

LIABILITIES AND EQUITY

CURRENT LIABILITIES:
Current Portion of Long-term Debt $35,751 $30,583
Other Current Liabilities 693,846 646,188
------- -------
Total Current Liabilities 729,597 676,771

LONG-TERM DEBT, NET OF CURRENT PORTION 3,207,464 3,208,384
OTHER LONG-TERM LIABILITIES 613,465 635,778

TOTAL IRON MOUNTAIN INCORPORATED
STOCKHOLDERS' EQUITY 1,802,780 1,948,735

NONCONTROLLING INTERESTS 3,548 2,831
----- -----

TOTAL EQUITY 1,806,328 1,951,566
--------- ---------

Total Liabilities and Equity $6,356,854 $6,472,499
========== ==========

Investor Relations Contact:
Stephen P. Golden
Vice President, Investor Relations
sgolden@ironmountain.com
(617) 535-4766

SOURCE Iron Mountain Incorporated

Stephen P. Golden, Vice President, Investor Relations, Iron Mountain
Incorporated, +1-617-535-4766, sgolden@ironmountain.com