United Rentals Inc. announced financial results for the second quarter 2014, with rental revenue climbing 16.8 percent from the same period in 2013. Equipment rental rose 16.1 percent year-over-year, reflecting year-over-year increases of 10.3 percent in the volume of equipment on rent and 4.9 percent in rental rates.
Total revenue was $1.399 billion and rental revenue was $1.179 billion, compared with $1.206 billion and $1.009 billion, respectively, for the same period last year. On a GAAP basis, the company reported second quarter net income of $94 million, or $0.90 per diluted share, compared with $83 million, or $0.78 per diluted share, for the same period last year.
Additional highlights of the results include:
- Adjusted EBITDA was $663 million and adjusted EBITDA margin was 47.4%, an increase of $114 million and 190 basis points, respectively, from the same period last year.
- ROIC was 8.1 percent for the 12 months ended June 30, 2014, an increase of 1.1 percentage points from the 12 months ended June 30, 2013.
- Time utilization increased 20 basis points year-over-year to 68.1%.
- The company generated $138 million of proceeds from used equipment sales at an adjusted gross margin of 48.6 percent, compared with $131 million and 42 percent for the same period last year.
- Flow-through, which represents the year-over-year change in adjusted EBITDA divided by the year-over-year change in total revenue, was 59.1 percent for the quarter.
"The rebound in non-residential construction is continuing to drive up demand, particularly in the energy and commercial sectors,” said Michael Kneeland, CEO of United Rentals. “Given the vigorous activity we're seeing, and the benefit of secular penetration, we've raised our full year outlook—and we concur with the forecasts that show multiple years of healthy industry growth beyond 2014."
The company raised its 2014 outlook from a total revenue of between $5.45 billion and $5.65 billion, to total revenue between $5.55 billion and $5.65 billion. The company now anticipates its rental rates will increase 4.5 percent year-over-year; the previous outlook predicted a 4 percent increase.