United Rentals sees big gain in revenue, updates 2011 projection
By United RentalsNews
Oct. 26, 2011 - United Rentals has announced financial results for the third quarter 2011.
Total revenue was $713 million and rental revenue was $604 million,
compared with $605 million and $507 million, respectively, for the same
period last year (all figures in U.S. dollars). This marks an increase in revenue of 19.1 per cent over the same period last year, spurring the company to change its rate increase projection for 2011 to six per cent.
Rental revenue increases reflected year-over-year
increases of 7.5 per cent in rental rates and 15 per cent in the volume of equipment
on rent. Time use was 73.5 per cent, an increase of 2.2 percentage
points from the same period last year, and a record high for the
company. The company has raised its outlook for a full-year increase in
time utilization to approximately 3 percentage points, year-over-year.
The company generated $42 million of proceeds from used
equipment sales at a gross margin of 35.7 per cent, compared with $32 million of
proceeds at a gross margin of 31.3 per cent for the same period last year.
Adjusted EBITDA was $282 million, an increase of $66
million compared with the same period last year. Adjusted EBITDA margin
was 39.6 per cent, an increase of 3.9 percentage points compared with the same
period last year, and a record for the company.
Michael Kneeland, CEO of United Rentals, said, “Our
strong performance is evidence of a strategy that has become deeply
rooted in our operations. The benefits of customer segmentation, price
optimization, customer service differentiation and cost efficiency have
begun to mesh in all areas of the business. This has put us in a
position to act decisively on growth opportunities, such as the $219
million we invested in fleet in the quarter. Not only did this help to
strengthen customer relationships and drive revenues, we also realized a
historic high adjusted EBITDA margin of 39.6 per cent.”
Kneeland continued, “While our customers remain bullish about
construction activity next year and there is a deepening belief in
rental penetration, our business model provides us with the flexibility
to respond, as we have in the past, to anything we may experience in
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