United Rentals' revenue and investment continue to climb
17 July 2013
US-based United Rentals increased its rental revenue by 4.7% in the second quarter of 2013, as well as investing US$750 million in its fleet during the period.
Total revenue stood at $1.206 billion, while rental revenue was $1.009 billion for the quarter, compared to the same period last year. Within the rental segment, owned equipment rental revenue increased 6.2%, reflecting year-on-year increases of 5.1% in the volume of equipment on rent and 4.2% in rental rates.
Adjusted earnings before interest, tax and amortisation (EBITDA) for the three months was $549 million, representing an increase of $76 million on the same period last year.
As a result, the company said it had reaffirmed its outlook for full year adjusted EBITDA in a range of $2.25 billion to $2.35 billion.
“Our strong second quarter performance reflects our commitment to a strategy of profitable and disciplined growth,” said Michael Kneeland, United Rentals’ chief executive officer.
“We invested over $730 million in fleet purchases in the second quarter to fill customer orders, especially key accounts, and prepare for peak season demand. We feel comfortable about achieving our full year outlook on rate, total revenue, EBITDA and free cash flow, while continuing to reduce our leverage.”
Over the first half of 2013, total revenue was $2.306 billion, while rental revenue was $1.925 billion, compared to $2.196 billion and $1.833 billion, respectively, for the same period last year.
In percentage terms, the half year results were very similar to the second quarter. Rental revenue increased 5%. Within rental revenue, owned equipment rental revenue increased 6.7%, reflecting year-on-year increases of 5.4% in the volume of equipment on rent and 4.8% in rental rates.
The integration of RSC, which United Rentals acquired last year, is still underway. “The company realised cost synergies of $60 million in the quarter from the integration of RSC, and reaffirmed its goal of $230 million to $250 million of annual cost synergies on a fully developed basis,” added a company spokesman.
