Daily Archives: August 8, 2018

Former Panasonic Executive Joins Encompass in Key Operational Role

New Hire to Strengthen Leadership Team as Company Manages Explosive Growth

LAWRENCEVILLE, Ga., Aug. 08, 2018 (GLOBE NEWSWIRE) — Encompass Supply Chain Solutions, Inc., a leading provider of Distribution, 3PL and 4PL solutions for a diverse range of finished goods and replacement parts, today announced that Brad Moszkiewicz – electronics industry veteran and former Panasonic vice president – has been tapped to lead its warehouse operations.

In his position as Director of Warehouse Operations, Moszkiewicz will be responsible for managing Encompass distribution centers located in Georgia, Florida and Nevada, which opened earlier this year in Las Vegas. He will play an integral role in the current build out of a new distribution facility in Ft. Lauderdale, Fla., which is replacing the company’s nearby existing warehouse and doubling its capacity.

Encompass’ larger footprint is needed to accommodate added volume driven by the company’s expansion in parts support for such segments as Appliance, HVAC and Computer. It is currently evaluating other strategic locations across the country to serve its nationwide customer base.

Moszkiewicz brings more than 20 years of experience in operations, supply chain, distribution and customer service management through progressive roles at Panasonic, one of the world’s top manufacturers of a wide range of products including consumer electronics, appliance, audio visual, personal care and many more. Among his many achievements at Panasonic, Moszkiewicz negotiated several vendor contracts, including freight, outsourced labor and call center support that resulted in multi-million-dollar operational cost savings.

Moszkiewicz joins Encompass during a period of exceptional growth in the company’s history, said Scott Cameron, senior vice president of Operations and Service Solutions. In addition to parts distribution volume, Encompass increasingly is taking responsibility for the entire parts supply chain for manufacturers opting to minimize their parts infrastructure costs and enhance aftersales service.

“We are very fortunate to bring someone of Brad’s caliber onto our leadership team,” said Cameron. “As Encompass continues to manage unprecedented volume in our distribution centers, Brad’s proven multi-site operational experience, talent and knowledge will be a tremendous asset to our organization and customers.”

Cameron said Moszkiewicz will be tasked with integrating and standardizing supply chain operations to maximize revenue growth, process innovation and cost reduction. Onboarding new 3PL and 4PL clients and monitoring performance metrics for optimal operational efficiency will be another key part of his role.

Moszkiewicz will also be closely collaborating with the Encompass executive team on planning, budgeting and decision making, enabling the organization to reach its business goals and objectives. Encompass has been aggressively targeting new markets – such as home warranty – to support its growth strategy.

About Encompass Supply Chain Solutions, Inc.
Encompass is a market leader in forward and reverse supply chain management and high-tech repair services for a diverse and expanding range of consumer electronics, computer, major appliances and imaging products.  Encompass provides end-to-end solutions for OEMs, retailers, independent dealers and third-party administrators.

Encompass manages all stages of the product lifecycle, including finished goods and replacement parts logistics, board repair and product refurbishment services, returns management, asset value recovery and eco-friendly disposal. For more information, please visit solutions.encompass.com and encompass.com and follow us on LinkedIn, Facebook, and Twitter.

Kristin Hurst
Director of Marketing
Ph: 954.474.0325
khurst@encompass.com

Uxin to Report Second Quarter 2018 Financial Results on August 22, 2018

BEIJING, Aug. 08, 2018 (GLOBE NEWSWIRE) — Uxin Limited. (“Uxin” or the “Company”) (Nasdaq: UXIN), the largest used car e-commerce platform in China, today announced that it will report its second quarter 2018 unaudited financial results on Wednesday, August 22, 2018, before U.S. market hours.

Uxin’s management team will host a conference call at 8:00am U.S. Eastern Time, (8:00pm Beijing/Hong Kong time) on August 22, 2018, following the quarterly results announcement.

The dial-in details for the live conference call are:

U.S.: +1 8665194004 or +1 8456750437
International: +65 67135090
Mainland China: 400-6208038 or 800-8190121
Hong Kong: 800-906601 or +852 30186771
Conference ID: 2295489

A replay of the conference call may be accessed by phone at the following number until September 6, 2018:

U.S.: +1 646 254 3697
International: +61 2 8199 0299
Conference ID: 2295489

A live webcast and archive of the conference call will be available on the Investor Relations section of Uxin’s website at http://ir.xin.com/.

About Uxin

Uxin Limited (Nasdaq: UXIN) is the largest used car e-commerce platform in China. Uxin’s mission is to enable people to buy the car of their choice, no matter where they are located or what their budget is. Uxin enables consumers and dealers to buy and sell cars through an innovative integrated online and offline platform that addresses each step of the transaction and covers the entire value chain. Its online presence is bolstered by an offline network of more than 670 service centers in over 270 cities throughout China.

For investor enquiries, please contact:

Trista Ren
Uxin Investor Relations
Tel: +86 10 5691-6765
Email: ir@xin.com

For media enquiries, please contact:

Rory Macpherson
Brunswick Group
Tel: +86 21 6039-6388
Email: uxin@brunswickgroup.com

SOURCE Uxin Limited.

Williams Scotsman Announces Second Quarter 2018 Results and Provides Update on Pending ModSpace Acquisition

BALTIMORE, Aug. 07, 2018 (GLOBE NEWSWIRE) — WillScot Corporation (Nasdaq: WSC) (“Williams Scotsman” or the “Company”) today announced its second quarter 2018 financial results and provided an update on the closing status and timeframe of its pending acquisition of Modular Space Holdings, Inc. (“ModSpace”).

Second Quarter 2018 Financial Highlights1,2

    • Revenues of $140.3 million, representing a 27.4% (or $30.2 million) year over year increase, driven by growth in core leasing and services revenues of $36.7 million, or 38.2%, as a result of organic rate and volume growth, further accelerated by our Acton Mobile (“Acton”) and Tyson Onsite (“Tyson”) acquisitions.
      • Consolidated modular space average monthly rental rate of $551 or a 3.2% year over year increase. Pro-forma, including results of Williams Scotsman, Acton, and Tyson for all periods presented, monthly rental rates increased 9.8% year over year.
      • Consolidated modular space units on rent increased 13,841 or a 34.0% year over year increase, including both organic growth and growth from recent acquisitions, and average modular space utilization increased 50 basis points (“bps”) year over year to 70.3%. Pro-forma, including results of Williams Scotsman, Acton and Tyson for all periods presented, average modular space units on rent and utilization increased 2.6% and 240 bps year over year, respectively.
      • The increases in leasing and services revenue were partially offset by decreases of $6.5 million, or 46.1%, in new unit and rental unit sales as compared to the same period in 2017.
    • Consolidated net income of $0.4 million, which includes $5.2 million of discrete integration and restructuring costs related to the Acton integration, and $4.1 million of transaction costs associated with the pending ModSpace acquisition.
    • Adjusted EBITDA of $41.9 million from our Modular – US and Modular – Other North America segments (the “Modular Segments”), representing a 45.5% (or $13.1 million) year over year increase as compared to the same period in 2017 and an 18.0% increase from the first quarter of 2018.
Three Months Ended June 30, Six Months Ended June 30,
Adjusted EBITDA by Segment (in thousands) 2018 2017 2018 2017
Modular – US $ 38,104 $ 26,329 $ 70,716 $ 50,012
Modular – Other North America 3,812 2,506 6,692 5,625
Modular Segments Adjusted EBITDA 41,916 28,835 77,408 55,637
Corporate and Other (2,588 ) (7,444 )
Consolidated Adjusted EBITDA $ 41,916 $ 26,247 $ 77,408 $ 48,193
Three Months Ended June 30, Six Months Ended June 30,
(in thousands) 2018 2017 2018 2017
Consolidated net income (loss) $ 379 $ (5,896 ) $ (6,456 ) $ (16,075 )

1 – WillScot Corporation (formerly known as Double Eagle Acquisition Corp.) acquired Williams Scotsman International, Inc. (“WSII”) on November 29, 2017 (the “Business Combination”). The Business Combination was accounted for as a reverse acquisition of Double Eagle Acquisition Corp. by WSII. Prior to completing the Business Combination, WSII’s parent company undertook an internal restructuring in which WSII’s remote accommodations business was removed from WSII. Financial results from WSII’s former remote accommodations business are presented as discontinued operations in the financial statements. As a result of the Business Combination, (i) Williams Scotsman’s consolidated financial results for periods prior to November 29, 2017, reflect the financial results of WSII and its consolidated subsidiaries, as the accounting predecessor to Williams Scotsman, and (ii) for periods from and after this date, Williams Scotsman’s financial results reflect those of Williams Scotsman and its consolidated subsidiaries (including WSII and its subsidiaries) as the successor following the Business Combination.

2 – Adjusted EBITDA is a non-GAAP financial measure. A reconciliation of Adjusted EBITDA, as well as segment-level results to net loss, have been provided in the financial statement tables included in this press release. An explanation of these non-GAAP financial measures is included below under the heading “Non-GAAP Financial Measures.” Please see the non-GAAP reconciliation tables included at the end of this press release.

Acquisition Updates

  • Executed on Acton integration plan, with full information technology system cut-over achieved, production consolidated in 90% of overlapping markets, and redundant branch location exit activities completed on schedule.
  • Announced acquisition of ModSpace, the largest privately held provider of office trailers, portable storage units and modular buildings in the US and Canada, with over 80 operating locations for an enterprise value of $1.1 billion, at the time of announcement.
  • Obtained the financing required to fund the pending ModSpace acquisition.
    • Secured a debt commitment to fund the acquisition prior to its announcement.
    • Upsized our revolving credit agreement to $1.35 billion (expandable to $1.8 billion through an accordion feature) and obtained the amendments required to finance the acquisition and to give effect to our greater scale thereafter.
    • Raised $128.0 million of gross proceeds from an underwritten common stock offering, subject to the underwriters’ right to purchase an additional 1.2 million shares (which could raise an additional $19.2 million of gross proceeds).
    • Completed $200.0 million private placement of senior unsecured notes due 2023.
    • Completed $300.0 million private placement of 6.875% senior secured notes due 2023.
  • Received a No Action Letter from the Canadian Competition Bureau, the receipt of which was a closing condition for the ModSpace acquisition.
  • Accelerated target closing date of pending ModSpace acquisition to mid-August.

Management Commentary

Brad Soultz, President and Chief Executive Officer of Williams Scotsman commented, “I am delighted with our second quarter Adjusted EBITDA results of $41.9 million, which is up 45.5% year over year for our modular segments and up 18.0% sequentially over the first quarter of 2018. The sequential growth is especially notable, as it reflects our continued strong organic growth as well as the realization of Acton-related synergies as the integration progresses. Of particular note, pro-forma modular space rates in our Modular – US Segment were up nearly 10% year over year for the third quarter in a row, driven by both continued improvement in base rental rates and expansion of our Ready to Work value proposition.

While delivering these outstanding results in the quarter, we also successfully migrated the Acton business onto the Williams Scotsman operating platform, representing a major integration milestone, and have now secured and announced the transformational acquisition of ModSpace. I am extremely proud of the Williams Scotsman team.”

Tim Boswell, Chief Financial Officer, commented, “Since July 9, we’ve raised $628.0 million of gross proceeds in the debt and equity capital markets and announced the expansion of our revolving credit facility to $1.35 billion. Together these transactions will allow us to fund the cash consideration for the ModSpace acquisition and give us the operational and financial flexibility to continue executing our strategy post-closing. We appreciate the strong support we have received from the investment community in meeting those objectives.”

Second Quarter 2018 Results

Total consolidated revenues increased 27.4% to $140.3 million, as compared to $110.1 million in the prior year quarter.

  • Modular – US segment revenue increased 27.1% to $124.8 million, as compared to $98.2 million in the prior year quarter with core leasing and services revenues up $32.6 million, or 38.0% year over year.
    • Modular space average monthly rental rate of $549, or a 2.6% year over year increase. Pro-forma, including results of Williams Scotsman, Acton, and Tyson for all periods presented, monthly rental rates increased 9.8% year over year.
    • Average modular space units on rent increased 13,217, or a 36.9% year over year increase, including both organic growth and growth from recent acquisitions. Pro-forma, including results of Williams Scotsman, Acton and Tyson for all periods presented, units on rent increased 1.6% year over year.
    • Average modular space utilization decreased 160 basis points (“bps”) year over year to 72.2% as a result of businesses acquired at lower utilization rates, however utilization increased 40 bps from Q1 2018. Pro-forma, including results of Williams Scotsman, Acton and Tyson for all periods presented, utilization increased 170 bps year over year.
    • The increases in leasing and services revenue were partially offset by decreases of $6.0 million, or 48.4%, in new unit and rental unit sales.
  • Modular – Other North America segment revenue increased 29.2% to $15.5 million, compared to $12.0 million in the prior year quarter, with modular space average units on rent up 12.7% and average monthly rental rate up 7.3% compared to the prior year quarter.

The Modular Segments delivered Adjusted EBITDA of $41.9 million, up 45.5% compared to $28.8 million in the prior year quarter. Modular – US segment Adjusted EBITDA increased 44.9% to $38.1 million, and Modular – Other North America segment Adjusted EBITDA increased $1.3 million to $3.8 million from the prior year quarter. Consolidated Adjusted EBITDA increased 59.9% to $41.9 million, as compared to $26.2 million in the prior year quarter.

Capitalization and Liquidity Update

Capital expenditures for rental equipment from continuing operations increased $5.1 million, or 18.5%, to $32.7 million for the three months ended June 30, 2018, from $27.6 million for the three months ended June 30, 2017. Net capital expenditures for rental equipment also increased $5.9 million, or 25.8%, to $28.8 million for the three months ended June 30, 2018. For the six months ended June 30, 2018, capital expenditures for rental equipment from continuing operations increased $14.5 million, or 28.8% to $64.8 million from $50.3 million for the six months ended June 30, 2017. Net capital expenditures for rental equipment also increased $13.0 million, or 32.7% to $52.7 million for the six months ended June 30, 2018. The increases for both periods were driven by increased spend for refurbishments, new fleet, and value-added products and services (“VAPS”) to drive modular space unit on rent and revenue growth, and maintenance of a larger fleet following our Acton and Tyson acquisitions.

During the six months ended June 30, 2018, the Company’s total debt balance increased by $59.8 million to $686.5 million due to the Tyson acquisition, continued capital investments in our fleet, and borrowing to fund an $11.8 million reduction of accounts payable and accrued liabilities related to the Business Combination and certain aged accounts. As of June 30, 2018, the Company had $219.6 million of availability under its revolving credit facility.

Since June 30, 2018, we obtained the financing required to fund the pending ModSpace acquisition and to pay related fees and expenses.

  • We amended our revolving credit agreement to, among other things, (i) permit the ModSpace acquisition and our financing thereof, (ii) increase the credit facility limit to $1.35 billion, and increase its accordion feature to $450.0 million, and (iii) increase certain thresholds, basket sizes and default and notice triggers to account for our increased scale business following the ModSpace acquisition. The amendments will be effective upon closing of the ModSpace acquisition.
  • We issued 8.0 million shares of our Class A common stock at a public offering price of $16.00 per share, yielding gross proceeds of $128.0 million. The underwriters have the right to purchase an additional 1.2 million shares by August 24, which would yield an additional $19.2 million of gross proceeds.
  • We sold $200.0 million in aggregate principal amount of senior unsecured notes due 2023.
  • We sold $300.0 million in aggregate principal amount of 6.875% senior secured notes due 2023.

2018 Outlook

Management reaffirmed the Company’s outlook for full year 2018, inclusive of the Acton and Tyson acquisitions. Management expects to provide updated guidance after completing the ModSpace acquisition. This guidance is subject to the risks and uncertainties described in the “Forward-Looking Statements” below.

Non-GAAP Financial Measures

This press release includes non-GAAP financial measures, including Adjusted EBITDA. Williams Scotsman believes that this non-GAAP measure is useful to investors because it (i) allows investors to compare performance over various reporting periods on a consistent basis by removing from operating results the impact of items that do not reflect core operating performance; (ii) is used by our board of directors and management to assess our performance; (iii) may, subject to the limitations described below, enable investors to compare the performance of Williams Scotsman to its competitors; and (iv) provides an additional tool for investors to use in evaluating ongoing operating results and trends. A metric similar to Adjusted EBITDA is also used to evaluate Williams Scotsman’s ability to service its debt. This non-GAAP measure should not be considered in isolation from, or as an alternative to, financial measures determined in accordance with GAAP. Other companies may calculate Adjusted EBITDA and other non-GAAP financial measures differently, and therefore Williams Scotsman’s non-GAAP financial measures may not be directly comparable to similarly titled measures of other companies. For reconciliation of the non-GAAP measures used in this press release, see “Reconciliation of non-GAAP Financial Measures” included in this press release.

Conference Call Information

Williams Scotsman will host a conference call and webcast to discuss its second quarter results at 10 a.m. Eastern Time on Wednesday, August 8, 2018. The live call can be accessed by dialing (855) 312-9420 (US/Canada toll-free) or (210) 874-7774 (international) and asking to be connected to the Williams Scotsman call. A live webcast will also be accessible via the “Events & Presentations” section of the Company’s investor relations website https://investors.willscot.com. Choose “Events” and select the information pertaining to the Q2 WSC Earnings Conference Call. Additionally, there will be slides accompanying the webcast. Please allow at least 15 minutes prior to the call to register, download and install any necessary software. For those unable to listen to the live broadcast, an audio webcast of the call will be available for 60 days on the Company’s investor relations website.

About WillScot Corporation

Headquartered in Baltimore, Maryland, WillScot Corporation is the public holding company for the Williams Scotsman family of companies in the United States, Canada and Mexico. WillScot Corporation trades on the NASDAQ stock exchange under the ticker symbol “WSC.” Williams Scotsman is a specialty rental services market leader providing innovative modular space and portable storage solutions across North America. Williams Scotsman is the modular space supplier of choice for the construction, education, health care, government, retail, commercial, transportation, security and energy sectors. With over half a century of innovative history, organic growth and strategic acquisitions, its branch network includes over 100 locations, its fleet comprises nearly 100,000 modular space and portable storage units and its customer base has grown to approximately 35,000.

Forward-Looking Statements

This news release contains forward-looking statements (including affirmation of earnings guidance) within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended. The words “estimates,” “expects,” “anticipates,” “believes,” “forecasts,” “plans,” “intends,” “may,” “will,” “should,” “shall” and variations of these words and similar expressions identify forward-looking statements, which are generally not historical in nature. Forward-looking statements are subject to a number of risks, uncertainties, assumptions and other important factors, many of which are outside our control, which could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Although Williams Scotsman believes that these forward-looking statements are based on reasonable assumptions, it can give no assurance that any such forward-looking statement will materialize. Important factors that may affect actual results or outcomes include, among others, our ability to acquire and integrate new assets and operations (including the pending ModSpace acquisition); our ability to manage growth and execute our business plan; our estimates of the size of the markets for our products; the rate and degree of market acceptance of our products; the success of other competing modular space and portable storage solutions that exist or may become available; rising costs adversely affecting our profitability; potential litigation involving our Company; general economic and market conditions impacting demand for our products and services; implementation of tax reform; our ability to implement and maintain an effective system of internal controls; and such other risks and uncertainties described in the periodic reports we file with the Securities and Exchange Commission (“SEC”) from time to time (including our Form 10-K for the year ending December 31, 2017), which are available through the SEC’s EDGAR system at www.sec.gov and on our website. Any forward-looking statement speaks only at the date which it is made, and Williams Scotsman disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Additional Information and Where to Find It

Additional information about the transaction can be found on the Williams Scotsman investor relations website at https://investors.willscot.com.

WillScot Corporation
Consolidated Statements of Operations (Unaudited)

Three Months Ended June 30, Six Months Ended June 30,
(in thousands, except share data) 2018 2017 2018 2017
Revenues:
Leasing and services revenue:
Modular leasing $ 101,249 $ 72,954 $ 198,511 $ 141,941
Modular delivery and installation 31,413 22,949 57,663 41,953
Sales:
New units 5,236 9,396 12,664 14,882
Rental units 2,435 4,778 6,246 10,622
Total revenues 140,333 110,077 275,084 209,398
Costs:
Costs of leasing and services:
Modular leasing 27,129 21,340 54,291 40,442
Modular delivery and installation 30,127 22,339 55,648 40,472
Costs of sales:
New units 3,704 6,766 8,691 10,486
Rental units 1,263 2,575 3,578 6,283
Depreciation of rental equipment 23,470 17,474 47,315 34,194
Gross profit 54,640 39,583 105,561 77,521
Expenses:
Selling, general and administrative 47,734 31,652 92,948 64,413
Other depreciation and amortization 1,570 1,890 4,006 3,831
Restructuring costs 449 684 1,077 968
Currency losses (gains), net 572 (6,497 ) 1,596 (8,499 )
Other (income) expense, net (1,574 ) 461 (4,419 ) 591
Operating income 5,889 11,393 10,353 16,217
Interest expense 12,155 29,907 23,874 54,568
Interest income (3,509 ) (6,093 )
Loss from continuing operations before income tax (6,266 ) (15,005 ) (13,521 ) (32,258 )
Income tax benefit (6,645 ) (5,269 ) (7,065 ) (10,138 )
Income (loss) from continuing operations 379 (9,736 ) (6,456 ) (22,120 )
Income from discontinued operations, net of tax 3,840 6,045
Net income (loss) 379 (5,896 ) (6,456 ) (16,075 )
Net income (loss) attributable to non-controlling interest, net of tax 143 (505 )
Total income (loss) attributable to WSC $ 236 $ (5,896 ) $ (5,951 ) $ (16,075 )
Net income (loss) per share attributable to WSC – basic
Continuing operations – basic $ 0.00 $ (0.67 ) $ (0.08 ) $ (1.53 )
Discontinued operations – basic $ 0.00 $ 0.26 $ 0.00 $ 0.42
Net (loss) income per share – basic $ 0.00 $ (0.41 ) $ (0.08 ) $ (1.11 )
Net (loss) income per share attributable to WSC – diluted
Continuing operations – diluted $ 0.00 $ (0.67 ) $ (0.08 ) $ (1.53 )
Discontinued operations – diluted $ 0.00 $ 0.26 $ 0.00 $ 0.42
Net (loss) income per share – diluted $ 0.00 $ (0.41 ) $ (0.08 ) $ (1.11 )
Weighted average shares:
Basic 78,432,274 14,545,833 77,814,456 14,545,833
Diluted 82,180,086 14,545,833 77,814,456 14,545,833
Cash dividends declared per share $ $ $ $

Unaudited Segment Operating Data

Three Months Ended June 30, 2018 and 2017

Three Months Ended June 30, 2018
(in thousands, except for units on rent and rates) Modular – US Modular – Other North America Corporate & Other Total
Revenue $ 124,813 $ 15,520 $ $ 140,333
Gross profit $ 49,741 $ 4,899 $ $ 54,640
Adjusted EBITDA $ 38,104 $ 3,812 $ $ 41,916
Capital expenditures for rental equipment $ 30,931 $ 1,748 $ $ 32,679
Modular space units on rent (average during the period) 48,997 5,524 54,521
Average modular space utilization rate 72.2 % 57.1 % % 70.3 %
Average modular space monthly rental rate $ 549 $ 573 $ $ 551
Portable storage units on rent (average during the period) 13,127 369 13,496
Average portable storage utilization rate 68.5 % 57.4 % % 68.1 %
Average portable storage monthly rental rate $ 120 $ 116 $ $ 119
Three Months Ended June 30, 2017
(in thousands, except for units on rent and rates) Modular – US Modular – Other North America Corporate & Other Total
Revenue $ 98,209 $ 12,010 $ (142 ) $ 110,077
Gross profit $ 35,954 $ 3,769 $ (140 ) $ 39,583
Adjusted EBITDA $ 26,329 $ 2,506 $ (2,588 ) $ 26,247
Capital expenditures for rental equipment $ 25,909 $ 1,716 $ $ 27,625
Modular space units on rent (average during the period) 35,780 4,900 40,680
Average modular space utilization rate 73.8 % 50.0 % % 69.8 %
Average modular space monthly rental rate $ 535 $ 534 $ $ 534
Portable storage units on rent (average during the period) 11,988 351 12,339
Average portable storage utilization rate 70.7 % 51.8 % % 70.0 %
Average portable storage monthly rental rate $ 114 $ 118 $ $ 114


Six Months Ended June 30, 2018 and 2017

Six Months Ended June 30, 2018
(in thousands, except for units on rent and rates) Modular – US Modular – Other North America Total
Revenue $ 246,900 $ 28,184 $ 275,084
Gross profit $ 96,549 $ 9,012 $ 105,561
Adjusted EBITDA $ 70,716 $ 6,692 $ 77,408
Capital expenditures for rental equipment $ 61,455 $ 3,308 $ 64,763
Modular space units on rent (average during the period) 48,841 5,487 54,328
Average modular space utilization rate 72.2 % 57.0 % 70.3 %
Average modular space monthly rental rate $ 541 $ 557 $ 543
Portable storage units on rent (average during the period) 13,434 364 13,798
Average portable storage utilization rate 69.8 % 56.4 % 69.4 %
Average portable storage monthly rental rate $ 118 $ 116 $ 118
Six Months Ended June 30, 2017
(in thousands, except for units on rent and rates) Modular – US Modular – Other North America Corporate & Other Total
Revenue $ 185,624 $ 24,069 $ (295 ) $ 209,398
Gross profit $ 69,769 $ 8,035 $ (283 ) $ 77,521
Adjusted EBITDA $ 50,012 $ 5,625 $ (7,444 ) $ 48,193
Capital expenditures for rental equipment $ 47,958 $ 2,344 $ $ 50,302
Modular space units on rent (average during the period) 35,438 4,868 40,306
Average modular space utilization rate 73.0 % 49.6 % % 69.1 %
Average modular space monthly rental rate $ 524 $ 531 $ $ 524
Portable storage units on rent (average during the period) 12,394 355 12,749
Average portable storage utilization rate 72.9 % 52.2 % % 72.1 %
Average portable storage monthly rental rate $ 113 $ 114 $ $ 113

WillScot Corporation
Consolidated Balance Sheets

(in thousands, except share data) June 30, 2018 (unaudited) December 31, 2017
Assets
Cash and cash equivalents $ 8,181 $ 9,185
Trade receivables, net of allowances for doubtful accounts at June 30, 2018 and December 31, 2017 of $5,631 and $4,845, respectively 104,013 94,820
Raw materials and consumables 9,829 10,082
Prepaid expenses and other current assets 14,137 13,696
Total current assets 136,160 127,783
Rental equipment, net 1,075,040 1,040,146
Property, plant and equipment, net 82,361 83,666
Goodwill 33,570 28,609
Intangible assets, net 125,864 126,259
Other non-current assets 4,038 4,279
Total long-term assets 1,320,873 1,282,959
Total assets $ 1,457,033 $ 1,410,742
Liabilities
Accounts payable 58,370 57,051
Accrued liabilities 45,606 48,912
Accrued interest 1,802 2,704
Deferred revenue and customer deposits 50,382 45,182
Current portion of long-term debt 1,883 1,881
Total current liabilities 158,043 155,730
Long-term debt 684,641 624,865
Deferred tax liabilities 111,924 120,865
Deferred revenue and customer deposits 6,696 5,377
Other non-current liabilities 19,109 19,355
Long-term liabilities 822,370 770,462
Total liabilities 980,413 926,192
Commitments and contingencies
Class A common stock: $0.0001 par, 400,000,000 shares authorized at June 30, 2018 and December 31, 2017; 84,644,744 shares issued and outstanding at both June 30, 2018 and December 31, 2017 8 8
Class B common stock: $0.0001 par, 100,000,000 shares authorized at June 30, 2018 and December 31, 2017; 8,024,419 shares issued and outstanding at both June 30, 2018 and December 31, 2017 1 1
Additional paid-in-capital 2,123,101 2,121,926
Accumulated other comprehensive loss (54,417 ) (49,497 )
Accumulated deficit (1,640,230 ) (1,636,819 )
Total shareholders’ equity 428,463 435,619
Non-controlling interest 48,157 48,931
Total equity 476,620 484,550
Total liabilities and equity $ 1,457,033 $ 1,410,742

Reconciliation of non-GAAP Financial Measures

Net Income (Loss) to Adjusted EBITDA non-GAAP Reconciliations

We define EBITDA as net income (loss) plus interest (income) expense, income tax expense (benefit), depreciation and amortization. Our Adjusted EBITDA reflects the following further adjustments to EBITDA to exclude certain non-cash items and the effect of what we consider transactions or events not related to our core business operations:

  • Currency (gains) losses, net: on monetary assets and liabilities denominated in foreign currencies other than the subsidiaries’ functional currency. Substantially all such currency gains (losses) are unrealized and attributable to financings due to and from affiliated companies.
  • Goodwill and other impairment charges related to non-cash costs associated with impairment charges to goodwill, other intangibles, rental fleet and property, plant and equipment.
  • Restructuring costs associated with restructuring plans designed to streamline operations and reduce costs.
  • Costs to integrate acquired companies.
  • Non-cash charges for stock compensation plans.
  • Other expense includes consulting expenses related to certain one-time projects, financing costs not classified as interest expense and gains and losses on disposals of property, plant, and equipment.

Adjusted EBITDA has limitations as an analytical tool, and you should not consider the measure in isolation or as a substitute for net income (loss), cash flow from operations or other methods of analyzing WSC’s results as reported under GAAP. Some of these limitations are:

  • Adjusted EBITDA does not reflect changes in, or cash requirements, for our working capital needs;
  • Adjusted EBITDA does not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness;
  • Adjusted EBITDA does not reflect our tax expense or the cash requirements to pay our taxes;
  • Adjusted EBITDA does not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments;
  • Adjusted EBITDA does not reflect the impact on earnings or changes resulting from matters that we consider not to be indicative of our future operations;
  • although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and Adjusted EBITDA does not reflect any cash requirements for such replacements; and
  • other companies in our industry may calculate Adjusted EBITDA differently, limiting its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA should not be considered as discretionary cash available to reinvest in the growth of our business or as measures of cash that will be available to meet our obligations.

The table below presents the unaudited reconciliation of net loss calculated in accordance with GAAP to Adjusted EBITDA. See “Non-GAAP Financial Measures” above for further information regarding the Company’s use of non-GAAP financial measures.

Three Months Ended June 30, Six Months Ended June 30,
(in thousands) 2018 2017 2018 2017
Net income (loss) $ 379 $ (5,896 ) $ (6,456 ) $ (16,075 )
Income from discontinued operations, net of tax 3,840 6,045
Income (loss) from continuing operations 379 (9,736 ) (6,456 ) (22,120 )
Income tax benefit (6,645 ) (5,269 ) (7,065 ) (10,138 )
Loss from continuing operations before income tax (6,266 ) (15,005 ) (13,521 ) (32,258 )
Interest expense, net 12,155 26,398 23,874 48,475
Depreciation and amortization 25,040 19,364 51,321 38,025
Currency losses (gains), net 572 (6,497 ) 1,596 (8,499 )
Restructuring costs 449 684 1,077 968
Transaction fees 4,118 776 4,118 862
Integration costs 4,785 7,415
Stock compensation expense 1,054 1,175
Other expense 9 527 353 620
Adjusted EBITDA $ 41,916 $ 26,247 $ 77,408 $ 48,193

Net (Loss) Income to Adjusted EBITDA non-GAAP Reconciliations

The following tables present unaudited reconciliations of the Company’s loss from continuing operations before income tax to Adjusted EBITDA by segment for the three and six months ended June 30, 2018 and 2017, respectively:

Three Months Ended June 30, 2018
(in thousands) Modular – US Modular – Other North America Corporate & Other Consolidated
Net (loss) income $ (5,533 ) $ (733 ) $ 6,645 $ 379
Income from discontinued operations, net of tax
Loss (income) from continuing operations (5,533 ) (733 ) 6,645 379
Income tax benefit(a) (6,645 ) (6,645 )
Loss from continuing operations before income tax (5,533 ) (733 ) (6,266 )
Interest expense, net 11,663 492 12,155
Depreciation and amortization 21,571 3,469 25,040
Currency losses, net 114 458 572
Restructuring costs 449 449
Transaction Fees 4,049 69 4,118
Integration costs 4,785 4,785
Stock compensation expense 1,054 1,054
Other expense (48 ) 57 9
Adjusted EBITDA $ 38,104 $ 3,812 $ $ 41,916
Three Months Ended June 30, 2017
(in thousands) Modular – US Modular – Other North America Corporate & Other Consolidated
Net income (loss) $ 320 $ (1,442 ) $ (4,774 ) $ (5,896 )
Income from discontinued operations, net of tax(b) 3,840 3,840
Income (loss) from continuing operations 320 (1,442 ) (8,614 ) (9,736 )
Income tax benefit(a) (5,269 ) (5,269 )
Income (loss) from continuing operations before income tax 320 (1,442 ) (13,883 ) (15,005 )
Interest expense, net 15,953 1,038 9,407 26,398
Depreciation and amortization 15,830 3,189 345 19,364
Currency gains, net (5,800 ) (294 ) (403 ) (6,497 )
Restructuring costs 684 684
Transaction fees 46 730 776
Other expense (20 ) 15 532 527
Adjusted EBITDA $ 26,329 $ 2,506 $ (2,588 ) $ 26,247
Six Months Ended June 30, 2018
(in thousands) Modular – US Modular – Other North America Corporate & Other Consolidated
Net (loss) income $ (10,841 ) $ (2,680 ) $ 7,065 $ (6,456 )
Income from discontinued operations, net of tax
(Loss) income from continuing operations (10,841 ) (2,680 ) 7,065 (6,456 )
Income tax benefit(a) (7,065 ) (7,065 )
Loss from continuing operations before income tax (10,841 ) (2,680 ) (13,521 )
Interest expense, net 22,823 1,051 23,874
Depreciation and amortization 44,463 6,858 51,321
Currency losses, net 271 1,325 1,596
Restructuring costs 1,067 10 1,077
Transaction Fees 4,049 69 4,118
Integration costs 7,415 7,415
Stock compensation expense 1,175 1,175
Other expense 294 59 353
Adjusted EBITDA $ 70,716 $ 6,692 $ $ 77,408
Six Months Ended June 30, 2017
(in thousands) Modular – US Modular – Other North America Corporate & Other Consolidated
Net loss $ (5,210 ) $ (2,458 ) $ (8,407 ) $ (16,075 )
Income from discontinued operations, net of tax(b) 6,045 6,045
Loss from continuing operations (5,210 ) (2,458 ) (14,452 ) (22,120 )
Income tax benefit(a) (10,138 ) (10,138 )
Loss from continuing operations before income tax (5,210 ) (2,458 ) (24,590 ) (32,258 )
Interest expense, net 31,512 2,216 14,747 48,475
Depreciation and amortization 30,993 6,331 701 38,025
Currency gains, net (7,399 ) (481 ) (619 ) (8,499 )
Restructuring costs 968 968
Transaction fees 46 816 862
Other expense 70 17 533 620
Adjusted EBITDA $ 50,012 $ 5,625 $ (7,444 ) $ 48,193

(a) The Company does not allocate expenses on a segment level. As such, we have included tax income benefit in Corporate and other for the purpose of this reconciliation.

(b) For the purpose of this reconciliation, the Company has included income related to discontinued operations in Corporate and other as it all pertained to the Remote Accommodations segment which was discontinued as of November 29, 2017.

Net Capital Expenditures for Rental Equipment non-GAAP Reconciliation

The following table provides an unaudited reconciliation of purchase of rental equipment to Net Capital Expenditures for Rental Equipment:

Three Months Ended June 30, Six Months Ended June 30,
(in thousands) 2018 2017 2018 2017
Total purchase of rental equipment $ (32,679 ) $ (29,326 ) $ (64,763 ) $ (54,223 )
Total purchases of rental equipment from discontinued operations (1,701 ) (3,921 )
Total purchases of rental equipment from continuing operations (32,679 ) (27,625 ) (64,763 ) (50,302 )
Proceeds from sale of rental equipment 3,905 4,778 12,033 10,622
Net Capital Expenditures for Rental Equipment $ (28,774 ) $ (22,847 ) $ (52,730 ) $ (39,680 )

Contact Information

Investor Inquiries:

Mark Barbalato
investors@willscot.com

Media Inquiries:

Scott Junk
scott.junk@willscot.com

Laos Suspends New Dam Projects Following Catastrophe

PAKSE, LAOS The Laos government will suspend approval of new dams while it reviews more than 50 current projects following the catastrophic collapse of a hydropower facility late last month.

Kanya Khammoungkhoun, Deputy Director General of the Department of International Organizations at the Laos Ministry of Foreign Affairs, told VOA a wide scale review of the country’s dam projects would be launched in the wake of the disaster, which killed scores of people and displaced more than 10,000 others in two countries.

Over 50 dams in the country will be re-investigated and monitored closely together with the technical, double check the technical with all those dams under construction, he said. And the suspension of the further, of the approval of the new project until everything is further confirmed.

On July 23, an auxiliary dam at the Xe Pian Xe Namnoy dam cluster collapsed unleashing five billion cubic meters of water onto downstream villages in Attapeu province’s Sanamxai district.

An estimated 6,000 people were displaced in Laos; more than 30 have been confirmed dead and more than 100 remain missing. Rescuers hold out little hope of finding more survivors.

Some 5,000 people were also displaced about 130 kilometers downstream on the Sekong river at the northern Cambodian town of Siem Pang.

Survivors in Sanamxai district have told VOA that authorities misled them about the nature of the pending disaster hours after PNPC, the joint venture building the unfinished project, warned the dam was about to collapse.

One of the major firms in that joint venture – South Korea’s SK Engineering and Construction – repeatedly refused to comment when approached by VOA reporters at a disaster center they have set up in Sanamxai.

At a news conference on Tuesday, Lao Minister of Energy and Mines Khammany Inthirath said substandard construction, combined with unexpected rainfall, was to blame for the collapse of Saddle Dam D at the Xe Pian Xe Namnoy project, according to the Laotian Times.

Source: Voice of America

Previewing the Imposition of Chemical and Biological Weapons Control and Warfare Elimination Sanctions on Russia

MODERATOR: Thank you so much. Good afternoon, everyone. And thanks so much for joining us for this background call, conference call on the imposition of Chemical and Biological Weapons Control and Warfare Elimination Act sanctions on Russia.

State Department officials joining us today are [Senior State Department Official Number One]. He will be referred to as Senior State Department Official Number One. Also, [Senior State Department Official Two] will be referred to as Senior State Department Official Number Two.

I’ll turn it over to [Senior State Department Official One] who will open up our call, and then we’ll take a few questions. [Senior State Department Official One], go right ahead.

SENIOR STATE DEPARTMENT OFFICIAL ONE: Thanks, very much, [Moderator]. Thanks for joining us today, and we appreciate you listening. We’ve got somewe’ve got some things to announce as you will have probably already heard from [Moderator]’s official statement. We are today announcing that we’ve determined under something called the CBW Act, as [Moderator] mentioned, that the Government of the Russian Federation has used chemical or biological weapons against international law or against their own nationals. This is a triggering factor under the CBW Act for the imposition of mandatory sanctions.

We notified Congress today that pursuant to this act we intend to impose sanctions against the Russian Federation in a number of respects, the most significant of which is the imposition of a presumption of denial for all national security sensitive goods or technologies that are controlled by the Department of Commerce pursuant to the Export Administration Regulations. These goods are currently subject to a licensea case-by-case license determination, but we arehenceforth, when these sanctions go into effect, we will be presumptively denying such applications.

We arein approximately the 22nd of August or so, we anticipate that a Federal Register notice will be put out that will make these official. The congressional notification has gone under the act today. So these things are being set in motion.

There are a number of carve-outs that we are making under the sanctions that are required by the act. Not everything that is mandatory under the act we will be proceeding with at this time. The carve-outs will include awe will have a waiver for the provision of foreign assistance to Russia and to the Russian people. Our provision of foreign assistance is a tool of U.S. power and influence, and we’re not going to foreswear that just because we have the obligation to impose some sanctions against Russia. So that is going to be a carve-out under thisunder these new sanctions.

We are also waiving sanctions with respect to space flight activities, because of course there are space flight actions in which we are engaged with the Russian Federation upon which we depend in some regards. Those will be free to continue on a case-by-case licensing basis. And we are also having a carve-out for safety of commercial passenger aviation because some of these national security sensitive goods in question are ones that perhaps might be important for safety of flight issues, so we are allowing ourselves the ability to continue on a case-by-case basis with those items. And there are a couple of more things like purely commercial end users for civilian end uses will be on a case-by-case basis.

Rather than under that presumption of denial, an export license is also with respect to Russian nationals that work with these sorts of goods while employed by firms in the United States as opposed to elsewhere, as well as exports to wholly-owned subsidiaries of U.S. companies and other foreign companies in Russia.

So there are a few exceptions to this, but the basic rule we will be following the full scope of the mandatory sanctions required by the act. And we’d be happy to take any questions as you like. I should add also, for those of you familiar with the CBW Act, itthereunder its structure, if a series of criteria are not met within, I believe, 90 days from this pointif Russia does meet a series of criteria, it will bewe will have to be in a basis of considering whether or not to impose a secondor what sanctions to impose in a second tranche as specified by the structure of the statute. So hopefully we will not get to that point, but that’s really a question for Russia than for us.

MODERATOR: Okay. And with that we’ll take your questions. And a reminder, this is embargoed until the end of the call. We’ll start with Nick Wadhams from Bloomberg. Hi, Nick.

QUESTION: Thanks for doing the call. [Senior State Department Official One], can you talk a little

QUESTION: Hi. Can you hear me? Hello?

MODERATOR: Go right ahead, Nick.

QUESTION: Hey. Can you talk a little bit about what the second round of sanctions would look like? And can you also talk about why this is happening now as far as has been reported now by NBC in particular that there had been a two month deadline for the President to make this determination and then impose the sanctions, but that deadline expired a little while ago? So what accounted for the delay? Thank you.

SENIOR STATE DEPARTMENT OFFICIAL ONE: I’ll take the first bit first, if I might. These things are just intrinsically complicated and hard. I think we have invoked these sanctions under the act on threethis is the third time over the years. In both previous occasions, both with Syria in 2013 and with the DPRK in connectionor resulting from North Korea’s use of a VX nerve agent in the assassination in Kuala Lumpur. In both of those cases, the deadline was also not met. So unfortunately, it is more the norm than an unusual thing for us to be slightly late. These are complicated pieces of moving equipment, if you will, inside the U.S. bureaucracy, but we took our time to do our homework right, and we arewe have made the determination that you are hearing from us about today.

MODERATOR: Okay. Next question goes to Carol Morello with The Washington Post. Oh, sorry.

SENIOR STATE DEPARTMENT OFFICIAL ONE: Forgive me, I forgot to answer the question about the second round of sanctions. My mistake.

Obviously, we don’t forecast sanctions in advance, but simply by virtue of what the statute sets out, you will be able to see in the U.S. code that if the executive branch cannot certify that Russia has met a series of conditions within three months of the initial round of sanctions, the second round must be imposed. Those conditions are pretty demanding, but you can see them for yourself in the statute. They include, for example, that Russia is no longer using chemical or biological weapons in violation of international law, or using lethal chemical or biological weapons against its own nationals; secondly, that Russia has provided reliable assurances that it will not in the future engage in such activities; and also that Russia is willing to allow on-site inspections by United Nations observers or other internationally recognized impartial observers, or other reliable means exist to ensure that the government is not using chemical or biological weapons in violation of international law, et cetera.

So thatthose are the criteria. If those criteria are not metand as I said before, this is not something that we’re in a position to forecast, but certainly is really up to Russia to make that decision, whether they meet this criteria. The second round of sanctions under the CBW Act will require three of a number of sanctionsat least three of a number of sanctions to be imposed. They are in general more draconian than the first round. It’s designed to be a sliding scale of pressure, as I understand the creation of the law. And you can find those in Section 307(B) of the act if you’re curious.

MODERATOR: Okay. Next question goes to Carol Morello from The Washington Post.

QUESTION: Hi. Could you give us some idea about the money, the dollar value of the exports and imports that this will affect? And also can you tell us if you have notified the Kremlin of this already? Thank you.

SENIOR STATE DEPARTMENT OFFICIAL ONE: The last questionlast bit first. Yes, we have notified the Russians. The items affected, the technologies going toin fact, we also mentioned to our allies as well; I should make sure that’s also clear. We’ve been doing a good deal of diplomatic engagement before we talk to you today, and don’t take it personally.

Thewe’re interpreting thesewe are applying these sanctions against essentially all stateRussian state-owned or state-funded enterprises. That’s potentially a very great sweep of the Russian economy in terms of the potentially affected end users. I wouldnot sure the entire numbers, but youthe specific numbers, but it may be thatsomething on the order of 70 percent of their economy and maybe 40 percent of their workforce falls within those enterprises. So to the degree that they wish to acquire national security controlled goods that fall within the ambit of our prescription here, those are potentially affected. It is possible that this tradethe trade it affected could reach potentially hundreds of millions of dollars, but it also depends upon what RussiaRussian entities in fact apply to purchase. So if they don’t apply for exports of these goods, of course, we don’t have to presumewe don’t have to use the presumption of denial to deny it.

So really, it’s up to Russia how dramatic the impact is. But let me say that overall, historically something upwards of 50 percent of Commerce Department licenses for Russia have included at least one national security controlled item. So this is a non-trivial set of stuff. By dollar value, the top categories of items historically tend to be things like aero gas turbine engines, electricelectronic devices and components, integrated circuits, test and calibration equipment of various sorts, materials, production, equipment, and various things like that. The list is enormously elaborate.

MODERATOR: Okay. Next question goes to Gardiner Harris with The New York Times.

QUESTION: Hi, thanks for doing the call. Two questions. One is: Is there any new information that you have about the poisoning that led to this? What intelligence are you basing your decision on, or was it the original finding back in March that the Russians were to blame for this poisoning? And second: There has of course been this puzzling disconnect seemingly between the Trump administration writ large, the government, and President Trump himself, who keeps repeating that he wants to make ties with Russia better and that that would be a good thing. And doesn’t this action once again seem to contradict the President’s own stated desire to improve relations with Russia? Thanks.

SENIOR STATE DEPARTMENT OFFICIAL ONE: Sorry, remind me again the first bit.

QUESTION: Oh, the first bit was, is therewhat was the intelligence that you used to determine that Russia

SENIOR STATE DEPARTMENT OFFICIAL ONE: Ah, right.

QUESTION:was guilty of providing this nerve agent? Is there new information? Is this old information? Where are you getting the conclusion that Russia is behind this Skripol poisoning?

SENIOR STATE DEPARTMENT OFFICIAL ONE: Certainly. I will leave it to others to characterize the current state of our understanding of the Skripol affair. We’ve been very clear that we agree with the assessment that it was a Novichok agent and that the perpetrator was ultimately the Russian Federation. I’ll leave it to others to give those kinds of details of what we currently understand. Obviously, from reading the press, it appears that their investigation is ongoing in terms of the scope and nature of the details and of its implications. But I’ll leave that to others.

With respect to our position on this, this is a question not of Russia policy per se but of implementing laws that Congress has put in place. The criteria for running the clock under the CBW Act began when we made the call back in March that we agreed that the use of chemical weapons had occurred.

This is not about different bits of the administration going in different directions. We are all one administration and we’re all on the same page here. The State Department is part of the administration, and this is all part of an overall approach that’s quite consistent. We are tough on Russia and at the same time we’re quite committed to working to maintain relations because there are important things at stake here. We work on cooperative things where it is possible to do so, and we cry foul when it’s necessary to do so. That’s been a part of our strategy all along and it’s nothing new here.

MODERATOR: Our next question goes to Nick from PBS. Sir? Okay. Well, I’ll head over to Susannah George from AP.

QUESTION: Can you hear me?

MODERATOR: Yes, we can. Go right ahead.

QUESTION: Hi, Heather, sorry, sorry. Sorry, guys. Thanks for doing this. I just had a questionjust had a question about the effect of this or what you want the effect to be and what you want the goal to be. So you said that this listengines, circuits, materials, production equipmentit’s elaborate. To sum it up, what do you expect the effect of trying to cut all of those things off from Russia to be? And what’s the goal? Is the goal to deter Russia from doing this again, or how would you put what the goal of this action is today?

SENIOR STATE DEPARTMENT OFFICIAL ONE: Well I think it was pretty clear when Congress passed this that the objective was to punish egregious acts as defined in the statute. We are trying to faithfully implement that. Hopefully it will have a deterrent effect in the future. You can see from the structure of the act that it isthat the second tranche of sanctions is designed to come into play unless and until Russia has done things that go to issues of remedial behavior, right, allowinggiving reliable assurances that nothing like this will happen again; allowing inspectors to verify that that is, in fact, the case. I believe there are criteria in the act with regard to restitution for victims.

So this is about partly making sure this doesn’t happen again and partly making good in response to the problem that hasto the perpetration of this act in the first place.

MODERATOR: Okay. Next question is Susannah George from AP.

QUESTION: Hey there, thanks for doing this call. Two questions. You said that you notified the Kremlin about this. In your talks with Russia, does Russia express any willingness to allow inspections to show compliance? And then if you could just describe how these sanctions are different from the other sanctions that are already in place against Russia. Thanks.

SENIOR STATE DEPARTMENT OFFICIAL ONE: Well, it’s not my place to describe the content of diplomatic encounters, so if they wish to characterize what they think, they’re probably pretty good at doing that themselves. With respect to these particular sanctions, I mean just by way of example, I mean, the current framework for export of the goodssome of the change with respect to these technology control items, the current approach is that these are on a case-by-case basis under normal licensing procedures. That will no longer be the case for these items. They’ll be under what we call a presumption of denial. That’s a significant change, so that is a difference from where the status quo was before.

There are a number of sanctions that are in place under a variety of statutes against Russia right now and executive orders, but I will let others characterize most of those. I mean, certainly the Global Magnitsky human rights sanctions have been in place here. That’s not really my lane in the road here at the State Department, so I’m not so expert on all the other bits and pieces. But this is only one of a number of pieces, a number of instances in which we are faithfully implementing sanctions against Russia as required by U.S. law.

MODERATOR: Next question, Lesley Wroughton from Reuters. Lesley, are you there?

QUESTION: I amI’m here, sorry. Hello. I’m looking at the actual act, andwhich contains the provision for sanctions, and I’m wondering if the President has approved an exemption for Russia’s RD-180 rocket engines which NASA depends on for its Atlas rockets. Do you knowI guess the Russians are the sole supplier of those.

SENIOR STATE DEPARTMENT OFFICIAL ONE: (Inaudible) national security-controlled item under the EAR. However, we do have a general carve-out in these sanctions for space flight activities, government space cooperation and commercial space launch. It may be, however, that that particular engine is under a different framework.

MODERATOR: Last question goes to Laura Rozen.

QUESTION: Thank you so much for doing this. Following up on Carol Morello’s question, can you how it was communicated to the Kremlin that you are going to impose these sanctions? Who talked to who or met with who?

SENIOR STATE DEPARTMENT OFFICIAL ONE: We informed them this afternoon. That’s about as much as I can say right now.

QUESTION: They often tell us on these backgrounders that thewho met with whom at the embassy or whatever.

SENIOR STATE DEPARTMENT OFFICIAL ONE: I don’t know what’s normal. I would just leave it at that.

QUESTION: Thanks.

MODERATOR: Okay, thanks, everybody, for joining the call. As a reminder, this is on background to a senior State Department official. The embargo has now been lifted. Have a great day; hope you’re all well.

SENIOR STATE DEPARTMENT OFFICIAL ONE: Thanks very much, everyone.

MODERATOR: Thanks.

Source: U.S. State Department

Deputy Assistant Secretary for the Bureau of Conflict and Stabilization Operations Pete Marocco Travels to Morocco, Egypt, and Tunisia

Deputy Assistant Secretary Pete Marocco will travel to Rabat, Morocco; Cairo, Egypt; and Tunis, Tunisia August 9-14.

In Rabat, he will meet with civil society implementing partners. In Cairo, he will meet with Arab League officials to discuss a capacity-building program on conflict resolution. During his time in Tunis, he will meet with Libyan grantees who work on local stabilization.

Source: U.S. State Department

LAO MINISTERS OUTLINE MAIN AREAS OF AID NEEDED IN DAM COLLAPSE AREA

VIENTIANE, The Lao government will immediately focus on four main areas of assistance for people affected by the flood caused by the dam failure in Attapeu province’s Sanamxay district, ministers told the media.

The four areas of concern were announced by Minister of Foreign Affairs Saleumxay Kommasith at a briefing conference held in Vientiane Tuesday, jointly attended by minister and deputy ministers for energy and mines, public health, and labor and social welfare.

The meeting updated representatives of international organizations, the diplomatic corps and media personnel as well as other government officials on the latest developments in the flood-hit region, and how the government was responding to the tragedy.

Saleumxay said first and foremost the government would continue the search and rescue operation for those who are still missing.

“We still have about 100 people missing which is a big concern,” he said, adding that the government needed more sophisticated equipment to help locate them.

The second target, he said, was to rebuild infrastructure, especially road access to the disaster-hit areas, after roads and bridges were damaged or washed away by the floodwaters.

Trucks carrying emergency relief supplies had been hampered by the difficult conditions, he added. Some bridges could only carry loads of three tonnes which hindered the delivery of donated goods to the over 6,000 people affected by the flash flood, which was triggered by the collapse of an auxiliary dam at the Xe-Pian Xe-Namnoy hydropower plant.

Saleumxay said it was taking too long for the authorities to distribute all the emergency aid that Laos had been given by the international community so it was essential to speed up the repair of roads and bridges so those people who needed help did not have to wait longer than necessary.

The third most important task was to distribute food supplies, while the fourth essential area of need was the provision of medical equipment and supplies, including ambulances and vaccines.

The Lao government is now calculating the total cost of the damage inflicted by the flood and will formulate a master plan for the resettlement and rehabilitation of the area so that people’s livelihoods can be restored.

During the briefing Lao Minister of Energy and Mines Khammany Inthirath said the government had formed a team, which included representatives of various sectors, to determine the exact cause of the accident. He expressed heartfelt sympathy with the victims of the disaster.

A representative of the Ministry of Health said the ministry’s most urgent need was to provide toilets, vaccines and ambulances to keep people as healthy as possible.

The flood is one of the worst in Lao history and to date has claimed the lives of at least 34 people including three who died in hospital. Some 100 people are still missing, local daily Vientiane Times reported on Wednesday.

On July 23, a saddle dam of the Xe-Pian Xe-Namnoy hydroelectric power project, invested by South Korean, Thai and Lao companies, burst, unleashing flood water from the mountain to 13 villages of Sanamxay district downstream the Xe Pian River, some 560 km southeast of Vientiane.

Source: NAM News Network

Government Is Grateful For Help From International Community; PM

The government cabinet has expressed gratitude to the international community for the care, courage, help extended promptly to the government and Lao people, more specifically to flood victims in Sanamxay district, Attapeu Province.

The government meeting would like to express special thanks to rescue workers, and volunteers from friendly countries, especially from the Socialist Republic of Vietnam, PR. China, the Kingdom of Thailand, R. Korea, R. Singapore, among others, who have been working with local rescue workers conducting rescue activities and giving help to victims with a spirit of great devotion and humanity. All the Lao people are extremely grateful for such kindness, Prime Minister Thongloun Sisoulith said in an address to the closing ceremony of the government monthly meeting on Aug 7.

The meeting also expressed thanks to all the Lao people across the country to be so concerned about the dam tragedy and have devoted in kind and physically to sincerely help the victims.

Appreciation was also expressed to thank the military and police officers, volunteers, health workers, journalists, both domestic and foreign, as well as civil servants at all Party and government agencies, mass organizations, entrepreneurs, business people, academics, artists and Lao people, both in the country and abroad, for their contributions to relieve the suffering caused by the dam tragedy.

Source: Lao News Agency