United Rentals reports solid demand 'in almost every market'
By Murray Pollok17 April 2014
United Rentals said it had made a “strong start” to the year and that its customers and managers were optimistic for the year, including long-awaited improvements in commercial construction.
The business reported revenue growth of 7.1% year-on-year to US$1178 million, with rental revenues up 9.7% at $1005 million. Its specialty rental businesses – trenching, pumps and heating and cooling equipment - saw sales up by 31% to $81 million.
EBITDA profits were up 15% to $519 million, representing a 44.1% EBITDA margin, a record for the first quarter.
United said the rental revenue increase was the result of a 7.6% increase in the volume of equipment on rent and a 4.3% rise in rental rates. It reaffirmed its outlook for a full-year increase in rental rates of approximately 4%, and full year total revenue in a range of $5.45 billion to $5.65 billion.
Michael Kneeland, chief executive officer of United Rentals, said, "We're off to a strong start in 2014, with notable year-over-year growth in rates, time utilization and volume….Despite the headwind of a harsh winter, we strategically managed our business to capitalize on pockets of opportunity. We now see solid demand in almost every market, giving us further confidence in our full year outlook.
"The feeling in the field is upbeat -- our customers and managers are bullish about business prospects, including the long-awaited recovery in commercial construction. We plan to leverage our scale in this environment and bring in about $750 million of fleet in the second quarter." The company will invest, gross, around $1.7 billion of new fleet during 2014.
He said the integration of National Pump, its latest major acquisition, was “going well”.