United Rentals to ‘outpace modest recovery’
By Murray Pollok02 February 2011
Rising rental rates and record fourth quarter time utilisation saw United Rentals increase its revenues by 7.2% for the final three months of 2010, with total revenues for the quarter up 10.4% to US$597 million.
United said the fourth quarter results were driven by a 1.2% increase in rental rates - the first year-on-year increase for 15 quarters - and time utilization of 69.3%, which is a record for a fourth quarter and up from 61.8% a year ago.
However, full year revenues were down 8.3% to $2.2 billion and the company has yet to return to profitability. Operating profits for the year were $197 million, but after interest expenses of $255 million and other adjustments the company made a net loss of $26 million. The net loss for the fourth quarter was $21 million.
Michael Kneeland, chief executive officer of United Rentals, said the company had outperformed its markets and made a very strong close to the year; "This year is about profitable growth for United Rentals. We are continuing to strengthen our metrics, our margins and the levers that drive them, particularly our customer service structure.
"Our strategy has been to stay in front of key customer segments through the worst of times, earning their confidence for exactly this point in the cycle. As a result, we expect to outpace what we see as a modest recovery in our end markets."
Gross rental expenditure is anticipated to be approximately $625 million in 2011, up from $346 million in 2010.