Solid third quarter for United Rentals
By Euan Youdale22 October 2015
Revenue and profits rose as expected for United Rentals in its third quarter despite some pressures from the oil and gas sector, as well as a weak Canadian dollar.
The USA-based rental giant said total revenue had risen to $1.550 billion, compared to $1.544 billion in the same quarter last year, while the company reported a third quarter net income of $215 million, compared with $192 million, for the same period last year.
Rental revenue increased 0.8% year-over-year. Within that, owned equipment evenue increased 1%, reflecting a year-on-year increase of 2.4% in the volume of equipment on rent, partially offset by a 0.1% decrease in rental rates.
Adjusted EBITDAwas $780 million, representing an increase of $19 million and a quarterly record for the company.
Michael Kneeland, chief executive officer of United Rentals, said, "The third quarter unfolded much as we had anticipated. As expected, we saw rate and time pressure on our general rental business from the continued impact of upstream oil and gas activity and a weak Canadian dollar."
Mr Kneeland added, "We’re now in the midst of planning for 2016, which we believe will be another solid year of industry growth. All of these factors, as well as the timing of current headwinds, will shape how we manage capex, rates and utilization in the coming year."
For the nine months of the financial year, revenue stood at $4.294 billion, whle rental revenue was $3.671 billion, compared with $4.121 billion and $3.499 billion, respectively, for the same period last year.
Adjusted EBITDA was $2.088 billion, while adjusted EBITDA margin was 48.6%, an increase of $145 million and 150 basis points, respectively.
Following the results United has reaffirmed its outlook for the full year of $5.8 billion to $5.9 billion total revenue, and a and an Adjusted EBITDA of $2.80 billion to $2.85 billion. It added that rental rates were expected to rise 0.5% year-on-year.