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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
July 9, 1998 (July 9, 1998)
Date of Report (Date of earliest event reported)
Laidlaw Environmental Services, Inc. d/b/a Safety-Kleen Corp.
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(Exact name of registrant as specified in its charter)
Delaware 1-8368 51-0228924
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(State or other jurisdiction) (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1301 Gervais Street, Columbia, South Carolina 29201
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (803)933-4200
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ITEM 5. OTHER EVENTS
The following information is provided to assist stockholders, analysts
and other interested persons in reviewing the reported financial results of
Safety-Kleen Corp., formerly known as Laidlaw Environmental Services, Inc. (the
"Company").
As a result of the combination of Safety-Kleen Corp. and Laidlaw
Environmental Services, Inc., management has revised the way it looks at the
Company's markets and the way in which the Company will present its financial
results in its public disclosure documents. The Company has divided its services
into two primary components: Disposal Services and Collection and Recovery
Services. The Disposal Services component includes the Company's end-disposal
facilities: thermal treatment and landfill operations as well as the Company's
harbor dredging program. This component will report the revenue for thermal,
landfill and other disposal methods. Management estimates that the total market
potential for Disposal Services is approximately $1.9 billion, of which the
Company currently has approximately a 21% market share.
The Collection and Recovery Services component encompasses two
divisions: Industrial Services and Commercial and Institutional Services.
Industrial Services includes all drum processing and direct shipment of bulk
waste streams, technical field services, lab-pack services and any parts cleaner
or on-site services the Company performs for an industrial customer. Management
estimates that Industrial Services has a $4.3 billion market potential, of which
the Company currently has approximately a 20% market share. Management believes
that this division has considerable growth potential, particularly in the
technical field services where the Company's newly combined resources now allow
it to provide end disposal for nearly all classes of industrial and hazardous
waste streams.
Commercial and Institutional Services includes all of the Company's
services performed for the retail end of the Company's market: parts cleaning,
imaging, vacuum and other special services. The estimated market potential for
Commercial and Institutional Services is $1.1 billion of which the Company
currently has approximately a 33% market share.
The used oil collection and re-refining operations and the European
business round out the Company's current service offerings.
The Company will no longer disclose gross revenue reduced by
intercompany business. Instead, the Company will disclose revenue based on the
initial point of entry into the Company's operations. This has reduced the
disclosed revenue for the Disposal Services component, which was the beneficiary
of intercompany revenue from the Collection, and Recovery Services component.
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Management estimates that the Company's nearly 400,000 customers in
North America represent approximately 30% of the Company's available customer
potential. Given that the Company only captures about 22% of the available
business from those customers, management believes annual revenue growth of
10-12% is achievable, led by the Industrial Services division. This document
contains various forward-looking statements within the meaning of the Private
Securities Litigation Act of 1995, including operating and other projections.
These statements are based on current plans and expectations of the Company and
involve risks and uncertainties that could cause actual future activities and
results of operations to be materially different from those set forth in the
forward looking statements. Important factors that could cause actual results to
differ include, among others, risks associated with acquisitions, fluctuations
in operating results because of acquisitions, variations in stock prices,
changes in applicable government regulations, competition and risks associated
with the operations and growth of the newly acquired businesses of Safety-Kleen
and Rollins. As a result of these factors, the Company's revenue and income
could vary significantly from quarter to quarter, and past performance should
not be considered a reliable indicator of future performance.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LAIDLAW ENVIRONMENTAL SERVICES, INC.
Date: July 9, 1998 By: /s/ Kenneth W. Winger
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Kenneth W. Winger, President
and Chief Executive Officer
