Delaware Delaware |
001-14387 001-13663 |
06-1522496 06-1493538 |
||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
Five Greenwich Office Park Greenwich, Connecticut |
06831 |
|
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
99.1 | Press Release of United Rentals, Inc. |
UNITED RENTALS, INC. |
||||
By: | /s/ Jonathan M. Gottsegen | |||
Name: | Jonathan M. Gottsegen | |||
Title: | Senior Vice President, General Counsel and Corporate Secretary | |||
UNITED RENTALS (NORTH AMERICA), INC. |
||||
By: | /s/ Jonathan M. Gottsegen | |||
Name: | Jonathan M. Gottsegen | |||
Title: | Senior Vice President, General Counsel and Corporate Secretary | |||
Exhibit No. | Description | |||
99.1 | Press Release of United Rentals, Inc. |
United Rentals, Inc. Five Greenwich Office Park Greenwich, CT 06831 Telephone: 203 622 3131 203 622 6080 unitedrentals.com |
| Rental revenue increased 19.1%, reflecting year-over-year increases of 7.5% in rental
rates and 15.0% in the volume of equipment on rent. The company has updated its outlook for
an increase in rental rates to about 6% for the full year. |
||
| Time utilization was 73.5%, an increase of 2.2 percentage points from the same period
last year, and a record high for the company. The company has raised its outlook for a
full-year increase in time utilization to approximately 3.0 percentage points
year-over-year. |
||
| The company generated $42 million of proceeds from used equipment sales at a gross
margin of 35.7%, compared with $32 million of proceeds at a gross margin of 31.3% for the
same period last year. |
||
| Adjusted EBITDA was $282 million, an increase of $66 million compared with the same
period last year. Adjusted EBITDA margin was 39.6%, an increase of 3.9 percentage points
compared with the same period last year, and a record for the company. |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Revenues: |
||||||||||||||||
Equipment rentals |
$ | 604 | $ | 507 | $ | 1,562 | $ | 1,337 | ||||||||
Sales of rental equipment |
42 | 32 | 115 | 104 | ||||||||||||
Sales of new equipment |
24 | 19 | 60 | 59 | ||||||||||||
Contractor supplies sales |
23 | 24 | 66 | 73 | ||||||||||||
Service and other revenues |
20 | 23 | 62 | 67 | ||||||||||||
Total revenues |
713 | 605 | 1,865 | 1,640 | ||||||||||||
Cost of revenues: |
||||||||||||||||
Cost of equipment rentals, excluding
depreciation |
261 | 237 | 740 | 668 | ||||||||||||
Depreciation of rental equipment |
110 | 98 | 312 | 289 | ||||||||||||
Cost of rental equipment sales |
27 | 22 | 73 | 74 | ||||||||||||
Cost of new equipment sales |
19 | 15 | 48 | 49 | ||||||||||||
Cost of contractor supplies sales |
15 | 16 | 45 | 51 | ||||||||||||
Cost of service and other revenues |
7 | 8 | 24 | 26 | ||||||||||||
Total cost of revenues |
439 | 396 | 1,242 | 1,157 | ||||||||||||
Gross profit |
274 | 209 | 623 | 483 | ||||||||||||
Selling, general and administrative expenses |
103 | 95 | 298 | 271 | ||||||||||||
Restructuring charge |
2 | 7 | 5 | 19 | ||||||||||||
Non-rental depreciation and amortization |
13 | 14 | 39 | 43 | ||||||||||||
Operating income |
156 | 93 | 281 | 150 | ||||||||||||
Interest expense, net |
57 | 55 | 170 | 170 | ||||||||||||
Interest expense subordinated convertible
debentures |
1 | 2 | 5 | 6 | ||||||||||||
Other expense (income), net |
2 | (2 | ) | (2 | ) | (3 | ) | |||||||||
Income (loss) from continuing operations before
provision (benefit) for income taxes |
96 | 38 | 108 | (23 | ) | |||||||||||
Provision (benefit) for income taxes |
31 | 15 | 35 | (18 | ) | |||||||||||
Income (loss) from continuing operations |
65 | 23 | 73 | (5 | ) | |||||||||||
Loss from discontinued operation, net of taxes |
| | (1 | ) | | |||||||||||
Net income (loss) |
$ | 65 | $ | 23 | $ | 72 | $ | (5 | ) | |||||||
Diluted earnings (loss) per share: |
||||||||||||||||
Income (loss) from continuing operations |
$ | 0.91 | $ | 0.33 | $ | 1.00 | $ | (0.09 | ) | |||||||
Loss from discontinued operation |
| | (0.01 | ) | | |||||||||||
Net income (loss) |
$ | 0.91 | $ | 0.33 | $ | 0.99 | $ | (0.09 | ) | |||||||
September 30, | December 31, | |||||||
2011 | 2010 | |||||||
ASSETS |
||||||||
Cash and cash equivalents |
$ | 26 | $ | 203 | ||||
Accounts receivable, net |
453 | 377 | ||||||
Inventory |
56 | 39 | ||||||
Prepaid expenses and other assets |
68 | 37 | ||||||
Deferred taxes |
55 | 69 | ||||||
Total current assets |
658 | 725 | ||||||
Rental equipment, net |
2,587 | 2,280 | ||||||
Property and equipment, net |
371 | 393 | ||||||
Goodwill and other intangible assets, net |
332 | 227 | ||||||
Other long-term assets |
57 | 68 | ||||||
Total assets |
$ | 4,005 | $ | 3,693 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT) |
||||||||
Short-term debt and current maturities of long-term debt |
$ | 401 | $ | 229 | ||||
Accounts payable |
233 | 132 | ||||||
Accrued expenses and other liabilities |
245 | 208 | ||||||
Total current liabilities |
879 | 569 | ||||||
Long-term debt |
2,529 | 2,576 | ||||||
Subordinated convertible debentures |
87 | 124 | ||||||
Deferred taxes |
397 | 385 | ||||||
Other long-term liabilities |
58 | 59 | ||||||
Total liabilities |
3,950 | 3,713 | ||||||
Temporary equity |
41 | | ||||||
Common stock |
1 | 1 | ||||||
Additional paid-in capital |
478 | 492 | ||||||
Accumulated deficit |
(528 | ) | (600 | ) | ||||
Accumulated other comprehensive income |
63 | 87 | ||||||
Total stockholders equity (deficit) |
14 | (20 | ) | |||||
Total liabilities and stockholders equity (deficit) |
$ | 4,005 | $ | 3,693 | ||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Cash Flows From Operating Activities: |
||||||||||||||||
Net income (loss) |
$ | 65 | $ | 23 | $ | 72 | $ | (5 | ) | |||||||
Adjustments to reconcile net income (loss) to net cash provided by
operating activities: |
||||||||||||||||
Depreciation and amortization |
123 | 112 | 351 | 332 | ||||||||||||
Amortization of deferred financing costs and original
issue discounts |
6 | 6 | 17 | 17 | ||||||||||||
Gain on sales of rental equipment |
(15 | ) | (10 | ) | (42 | ) | (30 | ) | ||||||||
Gain on sales of non-rental equipment |
(1 | ) | | (2 | ) | (1 | ) | |||||||||
Stock compensation expense, net |
3 | 2 | 9 | 6 | ||||||||||||
Restructuring charge |
2 | 7 | 5 | 19 | ||||||||||||
Loss on repurchase/redemption of debt securities |
| | | 3 | ||||||||||||
Loss on retirement of subordinated convertible debentures |
| | 1 | | ||||||||||||
Increase (decrease) in deferred taxes |
20 | 12 | 16 | (35 | ) | |||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||
Increase in accounts receivable |
(45 | ) | (55 | ) | (60 | ) | (62 | ) | ||||||||
Decrease (increase) in inventory |
13 | 12 | (17 | ) | (4 | ) | ||||||||||
Decrease (increase) in prepaid expenses and other assets |
4 | 7 | (11 | ) | 62 | |||||||||||
(Decrease) increase in accounts payable |
(46 | ) | (22 | ) | 101 | 39 | ||||||||||
Increase in accrued expenses and other liabilities |
28 | 30 | 13 | 2 | ||||||||||||
Net cash provided by operating activities |
157 | 124 | 453 | 343 | ||||||||||||
Cash Flows From Investing Activities: |
||||||||||||||||
Purchases of rental equipment |
(219 | ) | (113 | ) | (631 | ) | (287 | ) | ||||||||
Purchases of non-rental equipment |
(11 | ) | (8 | ) | (24 | ) | (20 | ) | ||||||||
Proceeds from sales of rental equipment |
42 | 32 | 115 | 104 | ||||||||||||
Proceeds from sales of non-rental equipment |
3 | 3 | 11 | 6 | ||||||||||||
Purchases of other companies |
(55 | ) | | (198 | ) | | ||||||||||
Net cash used in investing activities |
(240 | ) | (86 | ) | (727 | ) | (197 | ) | ||||||||
Cash Flows From Financing Activities: |
||||||||||||||||
Proceeds from debt |
355 | 391 | 1,462 | 1,481 | ||||||||||||
Payments of debt, including subordinated convertible debentures |
(301 | ) | (293 | ) | (1,383 | ) | (1,625 | ) | ||||||||
Proceeds from the exercise of common stock options |
1 | | 31 | | ||||||||||||
Shares repurchased and retired |
| | (7 | ) | (1 | ) | ||||||||||
Cash paid in connection with the 4 percent Convertible Senior
Notes and related hedge, net |
(2 | ) | | (11 | ) | | ||||||||||
Excess tax benefits from share-based payment arrangements, net |
| (1 | ) | | (2 | ) | ||||||||||
Net cash provided by (used in) financing activities |
53 | 97 | 92 | (147 | ) | |||||||||||
Effect of foreign exchange rates |
(2 | ) | 5 | 5 | 2 | |||||||||||
Net (decrease) increase in cash and cash equivalents |
(32 | ) | 140 | (177 | ) | 1 | ||||||||||
Cash and cash equivalents at beginning of period |
58 | 30 | 203 | 169 | ||||||||||||
Cash and cash equivalents at end of period |
$ | 26 | $ | 170 | $ | 26 | $ | 170 | ||||||||
Supplemental disclosure of cash flow information: |
||||||||||||||||
Cash paid (received) for income taxes, net |
$ | 4 | $ | 1 | $ | 20 | $ | (49 | ) | |||||||
Cash paid for interest, including subordinated convertible
debentures |
43 | 19 | 141 | 140 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | |||||||||||||||||||
General Rentals |
||||||||||||||||||||||||
Reportable segment revenue |
$ | 643 | $ | 558 | 15.2 | % | $ | 1,704 | $ | 1,516 | 12.4 | % | ||||||||||||
Reportable segment operating income |
132 | 87 | 51.7 | % | 242 | 144 | 68.1 | % | ||||||||||||||||
Reportable segment operating margin |
20.5 | % | 15.6 | % | 4.9 | pp | 14.2 | % | 9.5 | % | 4.7 | pp | ||||||||||||
Trench Safety, Power & HVAC |
||||||||||||||||||||||||
Reportable segment revenue |
$ | 70 | $ | 47 | 48.9 | % | $ | 161 | $ | 124 | 29.8 | % | ||||||||||||
Reportable segment operating income |
26 | 13 | 100.0 | % | 44 | 25 | 76.0 | % | ||||||||||||||||
Reportable segment operating margin |
37.1 | % | 27.7 | % | 9.4 | pp | 27.3 | % | 20.2 | % | 7.1 | pp | ||||||||||||
Total United Rentals |
||||||||||||||||||||||||
Total revenue |
$ | 713 | $ | 605 | 17.9 | % | $ | 1,865 | $ | 1,640 | 13.7 | % | ||||||||||||
Total segment operating income (1) |
158 | 100 | 58.0 | % | 286 | 169 | 69.2 | % | ||||||||||||||||
Total segment operating margin (1) |
22.2 | % | 16.5 | % | 5.7 | pp | 15.3 | % | 10.3 | % | 5.0 | pp |
(1) | Excludes unallocated restructuring charge. |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Income (loss) from continuing operations |
$ | 65 | $ | 23 | $ | 73 | $ | (5 | ) | |||||||
Convertible debt interest1 7/8% notes |
| | | | ||||||||||||
Subordinated convertible debt interest |
1 | | | | ||||||||||||
Income (loss) from continuing operations
available to common stockholders |
66 | 23 | 73 | (5 | ) | |||||||||||
Loss from discontinued operation |
| | (1 | ) | | |||||||||||
Net income (loss) available to common stockholders |
$ | 66 | $ | 23 | $ | 72 | $ | (5 | ) | |||||||
Weighted-average common shares |
62.6 | 60.5 | 62.0 | 60.4 | ||||||||||||
Employee stock options and warrants |
0.6 | 0.4 | 1.2 | | ||||||||||||
Convertible subordinated notes 1 7/8% |
1.0 | 5.3 | 1.0 | | ||||||||||||
Convertible subordinated notes 4% |
6.4 | 1.6 | 8.6 | | ||||||||||||
Subordinated convertible debentures |
2.1 | | | | ||||||||||||
Restricted stock units |
0.6 | 0.7 | 0.6 | | ||||||||||||
Weighted average diluted shares |
73.3 | 68.5 | 73.4 | 60.4 | ||||||||||||
Diluted earnings (loss) per share: |
||||||||||||||||
Income (loss) from continuing operations |
$ | 0.91 | $ | 0.33 | $ | 1.00 | $ | (0.09 | ) | |||||||
Loss from discontinued operation |
| | (0.01 | ) | | |||||||||||
Net income (loss) |
$ | 0.91 | $ | 0.33 | $ | 0.99 | $ | (0.09 | ) | |||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Earnings (loss) per share from continuing operations GAAP,
as reported |
$ | 0.91 | $ | 0.33 | $ | 1.00 | $ | (0.09 | ) | |||||||
After-tax impact of: |
||||||||||||||||
Restructuring charge (1) |
0.01 | 0.06 | 0.04 | 0.20 | ||||||||||||
Loss on repurchase/redemption of debt securities
and retirement of subordinated convertible debentures |
| | 0.01 | 0.03 | ||||||||||||
Asset impairment charge (2) |
| 0.01 | 0.01 | 0.04 | ||||||||||||
Earnings per share from continuing operations adjusted |
$ | 0.92 | $ | 0.40 | $ | 1.06 | $ | 0.18 | ||||||||
(1) | Relates to branch closure charges and severance costs. |
|
(2) | Primarily reflects write-offs of leasehold improvements and other fixed assets. |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Net income (loss) |
$ | 65 | $ | 23 | $ | 72 | $ | (5 | ) | |||||||
Loss from discontinued operation, net of taxes |
| | 1 | | ||||||||||||
Provision (benefit) for income taxes |
31 | 15 | 35 | (18 | ) | |||||||||||
Interest expense, net |
57 | 55 | 170 | 170 | ||||||||||||
Interest expense subordinated convertible debentures |
1 | 2 | 5 | 6 | ||||||||||||
Depreciation of rental equipment |
110 | 98 | 312 | 289 | ||||||||||||
Non-rental depreciation and amortization |
13 | 14 | 39 | 43 | ||||||||||||
EBITDA (A) |
277 | 207 | 634 | 485 | ||||||||||||
Restructuring charge (1) |
2 | 7 | 5 | 19 | ||||||||||||
Stock compensation expense, net (2) |
3 | 2 | 9 | 6 | ||||||||||||
Adjusted EBITDA (B) |
$ | 282 | $ | 216 | $ | 648 | $ | 510 | ||||||||
(A) | Our EBITDA margin was 38.8%and 34.2% for the three months ended September 30, 2011 and 2010,
respectively, and 34.0% and 29.6% for the nine months ended September 30, 2011 and 2010,
respectively. |
|
(B) | Our adjusted EBITDA margin was 39.6% and 35.7% for the three months ended September 30, 2011
and 2010, respectively, and 34.7% and 31.1% for the nine months ended September 30, 2011 and 2010,
respectively. |
|
(1) | Relates to branch closure charges and severance costs. |
|
(2) | Represents non-cash, share-based payments associated with the granting of equity instruments. |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Net cash provided by operating activities |
$ | 157 | $ | 124 | $ | 453 | $ | 343 | ||||||||
Adjustments for items included in net cash provided by operating
activities but excluded from the calculation of EBITDA: |
||||||||||||||||
Loss from discontinued operation, net of taxes |
| | 1 | | ||||||||||||
Amortization of deferred financing costs and original
issue discounts |
(6 | ) | (6 | ) | (17 | ) | (17 | ) | ||||||||
Gain on sales of rental equipment |
15 | 10 | 42 | 30 | ||||||||||||
Gain on sales of non-rental equipment |
1 | | 2 | 1 | ||||||||||||
Restructuring charge (1) |
(2 | ) | (7 | ) | (5 | ) | (19 | ) | ||||||||
Stock compensation expense, net (2) |
(3 | ) | (2 | ) | (9 | ) | (6 | ) | ||||||||
Loss on repurchase/redemption of debt securities |
| | | (3 | ) | |||||||||||
Loss on retirement of subordinated convertible debentures |
| | (1 | ) | | |||||||||||
Changes in assets and liabilities |
68 | 68 | 7 | 65 | ||||||||||||
Cash paid for interest, including subordinated convertible
debentures |
43 | 19 | 141 | 140 | ||||||||||||
Cash paid (received) for income taxes, net |
4 | 1 | 20 | (49 | ) | |||||||||||
EBITDA |
277 | 207 | 634 | 485 | ||||||||||||
Restructuring charge (1) |
2 | 7 | 5 | 19 | ||||||||||||
Stock compensation expense, net (2) |
3 | 2 | 9 | 6 | ||||||||||||
Adjusted EBITDA |
$ | 282 | $ | 216 | $ | 648 | $ | 510 | ||||||||
(1) | Relates to branch closure charges and severance costs. |
|
(2) | Represents non-cash, share-based payments associated with the granting of equity instruments. |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Net cash provided by operating activities |
$ | 157 | $ | 124 | $ | 453 | $ | 343 | ||||||||
Purchases of rental equipment |
(219 | ) | (113 | ) | (631 | ) | (287 | ) | ||||||||
Purchases of non-rental equipment |
(11 | ) | (8 | ) | (24 | ) | (20 | ) | ||||||||
Proceeds from sales of rental equipment |
42 | 32 | 115 | 104 | ||||||||||||
Proceeds from sales of non-rental equipment |
3 | 3 | 11 | 6 | ||||||||||||
Excess tax benefits from share-based payment
arrangements, net |
| (1 | ) | | (2 | ) | ||||||||||
Free cash (usage) flow |
$ | (28 | ) | $ | 37 | $ | (76 | ) | $ | 144 | ||||||
\V[`]&"0&)"KDT$//D$&6:$#K$80M\!J*$`"$2`" M]+X!""`8[4(NT$`/AN@%0(\`0C_T1(\`06_T7K`V2NT03-_T3K_HJ/+JGT