What happened
Shares of Stericycle (SRCL) stock are down 15.1% as of 10:15 a.m. EDT this morning after the hazmat waste disposal company reported disappointing first-quarter earnings last night.
Expected to earn $0.82 per share according to Wall Street estimates, Stericycle instead reported just $0.57 pro forma. Sales likewise fell short of estimates, with Stericycle reporting just $830.1 million where $864.1 million had been expected.
Image source: Getty Images.
So what
And that's the good news. The bad news is that when calculated according to generally accepted accounting principles, Stericycle didn't earn any profit at all. To the contrary, GAAP results for the quarter showed a $0.42-per-share loss, versus Stericycle's $0.25-per-share profit in last year's Q1.
Sales were down 7% year over year, a fact management blamed on "year-over-year foreign exchange impact and expected softness in recall activity," and also apparently "significant weather impacts."
Now what
Investors don't seem to be buying those explanations, however, and perhaps they shouldn't. After all, Stericycle also announced today it is replacing its current CFO, Daniel Ginnetti, with Janet Zelenka, who was recently let go from Staples subsidiary Essendant after 15 years as that company's CFO.
The addition of new blood to the company may help Stericycle reverse a long-term trend of five straight years of declining earnings. For the time being, however, investors are withholding their endorsement -- and given the size of today's loss, I can't say that I blame them.
