Condensed Consolidating Financial Information of Guarantor Subsidiaries

6 Months Ended

Jun. 30, 2016

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Financial Information of Guarantor Subsidiaries

Condensed Consolidating Financial Information of Guarantor Subsidiaries

URNA is 100 percent owned by Holdings (“Parent”) and, as of June 30, 2016 and/or December 31, 2015, had outstanding (i) certain indebtedness that is guaranteed by both Parent and, with the exception of its U.S. special purpose vehicle which holds receivable assets relating to the Company’s accounts receivable securitization facility (the “SPV”), all of URNA’s U.S. subsidiaries (the “guarantor subsidiaries”) and (ii) certain indebtedness that was guaranteed only by the guarantor subsidiaries (specifically, the 8 ¹/4 percent Senior Notes). As discussed in note 6 to the condensed consolidated financial statements, in May 2016, all of the 8 ¹/₄ percent Senior Notes were redeemed. Other than the guarantee by certain Canadian subsidiaries of URNA's indebtedness under the ABL facility, none of URNA’s indebtedness is guaranteed by URNA's foreign subsidiaries or the SPV (together, the “non-guarantor subsidiaries”). The receivable assets owned by the SPV have been sold by URNA to the SPV and are not available to satisfy the obligations of URNA or Parent’s other subsidiaries. The guarantor subsidiaries are all 100 percent-owned and the guarantees are made on a joint and several basis. The guarantees are not full and unconditional because a guarantor subsidiary can be automatically released and relieved of its obligations under certain circumstances, including sale of the guarantor subsidiary, the sale of all or substantially all of the guarantor subsidiary's assets, the requirements for legal defeasance or covenant defeasance under the applicable indenture being met or designating the guarantor subsidiary as an unrestricted subsidiary for purposes of the applicable covenants. The guarantees are also subject to subordination provisions (to the same extent that the obligations of the issuer under the relevant notes are subordinated to other debt of the issuer) and to a standard limitation which provides that the maximum amount guaranteed by each guarantor will not exceed the maximum amount that can be guaranteed without making the guarantee void under fraudulent conveyance laws. Based on our understanding of Rule 3-10 of Regulation S-X ("Rule 3-10"), we believe that the guarantees of the guarantor subsidiaries comply with the conditions set forth in Rule 3-10 and therefore continue to utilize Rule 3-10 to present condensed consolidating financial information for Holdings, URNA, the guarantor subsidiaries and the non-guarantor subsidiaries. Separate consolidated financial statements of the guarantor subsidiaries have not been presented because management believes that such information would not be material to investors. However, condensed consolidating financial information is presented.

URNA covenants in the ABL facility, accounts receivable securitization facility and the other agreements governing our debt impose operating and financial restrictions on URNA, Parent and the guarantor subsidiaries, including limitations on the ability to make share repurchases and dividend payments. As of June 30, 2016, the amount available for distribution under the most restrictive of these covenants was $312. The Company’s total available capacity for making share repurchases and dividend payments includes the intercompany receivable balance of Parent. As of June 30, 2016, our total available capacity for making share repurchases and dividend payments, which includes URNA’s capacity to make restricted payments and the intercompany receivable balance of Parent, was $564.

The condensed consolidating financial information of Parent and its subsidiaries is as follows:

CONDENSED CONSOLIDATING BALANCE SHEET

June 30, 2016

	Parent		URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign			SPV
ASSETS
Cash and cash equivalents	$	—	$	8		$	—		$	257		$	—	$	—		$	265
Accounts receivable, net	—		37			—			91			739		—			867
Intercompany receivable (payable)	252		(49		)	(189		)	(124		)	—		110			—
Inventory	—		64			—			7			—		—			71
Prepaid expenses and other assets	—		48			—			13			—		—			61
Total current assets	252		108			(189		)	244			739		110			1,264
Rental equipment, net	—		5,807			—			518			—		—			6,325
Property and equipment, net	40		329			21			47			—		—			437
Investments in subsidiaries	1,231		997			988			—			—		(3,216		)	—
Goodwill	—		3,004			—			255			—		—			3,259
Other intangible assets, net	—		760			—			65			—		—			825
Other long-term assets	3		7			—			—			—		—			10
Total assets	$	1,526	$	11,012		$	820		$	1,129		$	739	$	(3,106	)	$	12,120
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	28		$	—		$	3		$	544	$	—		$	576
Accounts payable	—		574			—			35			—		—			609
Accrued expenses and other liabilities	—		290			13			20			—		—			323
Total current liabilities	1		892			13			58			544		—			1,508
Long-term debt	3		7,138			115			9			—		—			7,265
Deferred taxes	20		1,696			—			74			—		—			1,790
Other long-term liabilities	—		55			—			—			—		—			55
Total liabilities	24		9,781			128			141			544		—			10,618
Total stockholders’ equity (deficit)	1,502		1,231			692			988			195		(3,106		)	1,502
Total liabilities and stockholders’ equity (deficit)	$	1,526	$	11,012		$	820		$	1,129		$	739	$	(3,106	)	$	12,120

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2015

	Parent		URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
								Foreign			SPV
ASSETS
Cash and cash equivalents	$	—	$	18	$	—		$	161		$	—	$	—		$	179
Accounts receivable, net	—		41		—			104			785		—			930
Intercompany receivable (payable)	144		40		(176		)	(109		)	—		101			—
Inventory	—		62		—			7			—		—			69
Prepaid expenses and other assets	—		98		—			18			—		—			116
Total current assets	144		259		(176		)	181			785		101			1,294
Rental equipment, net	—		5,657		—			529			—		—			6,186
Property and equipment, net	45		334		20			46			—		—			445
Investments in subsidiaries	1,307		958		924			—			—		(3,189		)	—
Goodwill	—		3,000		—			243			—		—			3,243
Other intangible assets, net	—		838		—			67			—		—			905
Other long-term assets	3		7		—			—			—		—			10
Total assets	$	1,499	$	11,053	$	768		$	1,066		$	785	$	(3,088	)	$	12,083
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	34	$	—		$	—		$	572	$	—		$	607
Accounts payable	—		237		—			34			—		—			271
Accrued expenses and other liabilities	—		314		14			27			—		—			355
Total current liabilities	1		585		14			61			572		—			1,233
Long-term debt	4		7,430		110			11			—		—			7,555
Deferred taxes	18		1,677		—			70			—		—			1,765
Other long-term liabilities	—		54		—			—			—		—			54
Total liabilities	23		9,746		124			142			572		—			10,607
Total stockholders’ equity (deficit)	1,476		1,307		644			924			213		(3,088		)	1,476
Total liabilities and stockholders’ equity (deficit)	$	1,499	$	11,053	$	768		$	1,066		$	785	$	(3,088	)	$	12,083

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Three Months Ended June 30, 2016

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations			Total
									Foreign			SPV
Revenues:
Equipment rentals	$	—		$	1,103	$	—		$	101		$	—		$	—		$	1,204
Sales of rental equipment	—			117		—			17			—			—			134
Sales of new equipment	—			31		—			5			—			—			36
Contractor supplies sales	—			18		—			4			—			—			22
Service and other revenues	—			22		—			3			—			—			25
Total revenues	—			1,291		—			130			—			—			1,421
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			407		—			49			—			—			456
Depreciation of rental equipment	—			219		—			23			—			—			242
Cost of rental equipment sales	—			70		—			9			—			—			79
Cost of new equipment sales	—			25		—			4			—			—			29
Cost of contractor supplies sales	—			12		—			3			—			—			15
Cost of service and other revenues	—			10		—			—			—			—			10
Total cost of revenues	—			743		—			88			—			—			831
Gross profit	—			548		—			42			—			—			590
Selling, general and administrative expenses	2			155		—			18			2			—			177
Merger related costs	—			—		—			—			—			—			—
Restructuring charge	—			1		—			1			—			—			2
Non-rental depreciation and amortization	4			54		—			6			—			—			64
Operating (loss) income	(6		)	338		—			17			(2		)	—			347
Interest (income) expense, net	(1		)	133		—			—			1			(1		)	132
Other (income) expense, net (1)	(116		)	124		—			11			(21		)	—			(2		)
Income before provision for income taxes	111			81		—			6			18			1			217
Provision for income taxes	42			32		—			2			7			—			83
Income before equity in net earnings (loss) of subsidiaries	69			49		—			4			11			1			134
Equity in net earnings (loss) of subsidiaries	65			16		4			—			—			(85		)	—
Net income (loss)	134			65		4			4			11			(84		)	134
Other comprehensive (loss) income	—			—		(2		)	(2		)	—			4			—
Comprehensive income (loss)	$	134		$	65	$	2		$	2		$	11		$	(80	)	$	134

(1) Other (income) expense, net includes the royalties Holdings receives from URNA and its subsidiaries as discussed below (see Item 2- Management’s Discussion and Analysis of Financial Condition and Results of Operations- Liquidity and Capital Resources- Relationship between Holdings and URNA).

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Three Months Ended June 30, 2015

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		SPV
Revenues:
Equipment rentals	$	—		$	1,100	$	—		$	120	$	—		$	—		$	1,220
Sales of rental equipment	—			106		—			18		—			—			124
Sales of new equipment	—			34		—			5		—			—			39
Contractor supplies sales	—			18		—			3		—			—			21
Service and other revenues	—			22		—			3		—			—			25
Total revenues	—			1,280		—			149		—			—			1,429
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			389		—			56		—			—			445
Depreciation of rental equipment	—			216		—			24		—			—			240
Cost of rental equipment sales	—			58		—			10		—			—			68
Cost of new equipment sales	—			29		—			4		—			—			33
Cost of contractor supplies sales	—			13		—			2		—			—			15
Cost of service and other revenues	—			9		—			1		—			—			10
Total cost of revenues	—			714		—			97		—			—			811
Gross profit	—			566		—			52		—			—			618
Selling, general and administrative expenses	(4		)	153		—			18		8			—			175
Merger related costs	—			1		—			—		—			—			1
Restructuring charge	—			—		—			—		—			—			—
Non-rental depreciation and amortization	4			57		—			6		—			—			67
Operating income (loss)	—			355		—			28		(8		)	—			375
Interest expense (income), net	—			232		—			1		1			(2		)	232
Other (income) expense, net (1)	(38		)	55		—			2		(25		)	—			(6		)
Income before provision for income taxes	38			68		—			25		16			2			149
Provision for income taxes	18			28		2			9		6			—			63
Income (loss) before equity in net earnings (loss) of subsidiaries	20			40		(2		)	16		10			2			86
Equity in net earnings (loss) of subsidiaries	66			26		16			—		—			(108		)	—
Net income (loss)	86			66		14			16		10			(106		)	86
Other comprehensive income (loss)	17			17		16			13		—			(46		)	17
Comprehensive income (loss)	$	103		$	83	$	30		$	29	$	10		$	(152	)	$	103

(1) Other (income) expense, net includes the royalties Holdings receives from URNA and its subsidiaries as discussed below (see Item 2- Management’s Discussion and Analysis of Financial Condition and Results of Operations- Liquidity and Capital Resources- Relationship between Holdings and URNA).

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Six Months EndedJune 30, 2016

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		SPV
Revenues:
Equipment rentals	$	—		$	2,127	$	—		$	194	$	—		$	—		$	2,321
Sales of rental equipment	—			221		—			28		—			—			249
Sales of new equipment	—			58		—			8		—			—			66
Contractor supplies sales	—			35		—			6		—			—			41
Service and other revenues	—			47		—			7		—			—			54
Total revenues	—			2,488		—			243		—			—			2,731
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			811		—			94		—			—			905
Depreciation of rental equipment	—			440		—			45		—			—			485
Cost of rental equipment sales	—			132		—			15		—			—			147
Cost of new equipment sales	—			48		—			6		—			—			54
Cost of contractor supplies sales	—			24		—			4		—			—			28
Cost of service and other revenues	—			19		—			3		—			—			22
Total cost of revenues	—			1,474		—			167		—			—			1,641
Gross profit	—			1,014		—			76		—			—			1,090
Selling, general and administrative expenses	8			299		—			37		10			—			354
Merger related costs	—			—		—			—		—			—			—
Restructuring charge	—			3		—			1		—			—			4
Non-rental depreciation and amortization	8			111		—			12		—			—			131
Operating (loss) income	(16		)	601		—			26		(10		)	—			601
Interest (income) expense, net	(3		)	239		1			1		3			(2		)	239
Other (income) expense, net (1)	(222		)	246		—			20		(46		)	—			(2		)
Income (loss) before provision for income taxes	209			116		(1		)	5		33			2			364
Provision for income taxes	79			45		—			1		13			—			138
Income (loss) before equity in net earnings (loss) of subsidiaries	130			71		(1		)	4		20			2			226
Equity in net earnings (loss) of subsidiaries	96			25		4			—		—			(125		)	—
Net income (loss)	226			96		3			4		20			(123		)	226
Other comprehensive income (loss)	63			63		60			48		—			(171		)	63
Comprehensive income (loss)	$	289		$	159	$	63		$	52	$	20		$	(294	)	$	289

(1) Other (income) expense, net includes the royalties Holdings receives from URNA and its subsidiaries as discussed below (see Item 2- Management’s Discussion and Analysis of Financial Condition and Results of Operations- Liquidity and Capital Resources- Relationship between Holdings and URNA).

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Six Months EndedJune 30, 2015

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations			Total
										Foreign			SPV
Revenues:
Equipment rentals	$	—		$	2,098		$	—		$	247		$	—		$	—		$	2,345
Sales of rental equipment	—			212			—			28			—			—			240
Sales of new equipment	—			63			—			9			—			—			72
Contractor supplies sales	—			34			—			5			—			—			39
Service and other revenues	—			41			—			7			—			—			48
Total revenues	—			2,448			—			296			—			—			2,744
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			773			—			116			—			—			889
Depreciation of rental equipment	—			427			—			48			—			—			475
Cost of rental equipment sales	—			117			—			15			—			—			132
Cost of new equipment sales	—			53			—			7			—			—			60
Cost of contractor supplies sales	—			24			—			3			—			—			27
Cost of service and other revenues	—			15			—			4			—			—			19
Total cost of revenues	—			1,409			—			193			—			—			1,602
Gross profit	—			1,039			—			103			—			—			1,142
Selling, general and administrative expenses	(1		)	304			—			38			15			—			356
Merger related costs	—			(26		)	—			—			—			—			(26		)
Restructuring charge	—			1			—			—			—			—			1
Non-rental depreciation and amortization	8			116			—			12			—			—			136
Operating (loss) income	(7		)	644			—			53			(15		)	—			675
Interest (income) expense, net	(1		)	351			2			2			2			(3		)	353
Other (income) expense, net (1)	(73		)	107			1			3			(47		)	—			(9		)
Income (loss) before provision for income taxes	67			186			(3		)	48			30			3			331
Provision for income taxes	31			71			—			16			12			—			130
Income (loss) before equity in net earnings (loss) of subsidiaries	36			115			(3		)	32			18			3			201
Equity in net earnings (loss) of subsidiaries	165			50			32			—			—			(247		)	—
Net income (loss)	201			165			29			32			18			(244		)	201
Other comprehensive (loss) income	(72		)	(72		)	(74		)	(58		)	—			204			(72		)
Comprehensive income (loss)	$	129		$	93		$	(45	)	$	(26	)	$	18		$	(40	)	$	129

(1) Other (income) expense, net includes the royalties Holdings receives from URNA and its subsidiaries as discussed below (see Item 2- Management’s Discussion and Analysis of Financial Condition and Results of Operations- Liquidity and Capital Resources- Relationship between Holdings and URNA).

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Six Months EndedJune 30, 2016

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			SPV
Net cash provided by (used in) operating activities	$	2		$	1,096		$	(1	)	$	84		$	66		$	—	$	1,247
Net cash (used in) provided by investing activities	(2		)	(522		)	—			2			—			—		(522		)
Net cash (used in) provided by financing activities	—			(584		)	1			(2		)	(66		)	—		(651		)
Effect of foreign exchange rates	—			—			—			12			—			—		12
Net (decrease) increase in cash and cash equivalents	—			(10		)	—			96			—			—		86
Cash and cash equivalents at beginning of period	—			18			—			161			—			—		179
Cash and cash equivalents at end of period	$	—		$	8		$	—		$	257		$	—		$	—	$	265

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Six Months EndedJune 30, 2015

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			SPV
Net cash provided by operating activities	$	6		$	1,069		$	1		$	144		$	30		$	—	$	1,250
Net cash used in investing activities	(6		)	(793		)	—			(77		)	—			—		(876		)
Net cash used in financing activities	—			(280		)	(1		)	(7		)	(30		)	—		(318		)
Effect of foreign exchange rates	—			—			—			(14		)	—			—		(14		)
Net (decrease) increase in cash and cash equivalents	—			(4		)	—			46			—			—		42
Cash and cash equivalents at beginning of period	—			8			—			150			—			—		158
Cash and cash equivalents at end of period	$	—		$	4		$	—		$	196		$	—		$	—	$	200