Segment Reporting

9 Months Ended

Sep. 30, 2012

Segment Reporting [Abstract]

SEGMENT REPORTING

NOTE 6. SEGMENT REPORTING

The Company’s four reportable segments are (1) its modular building rental division (“Mobile Modular”); (2) its electronic test equipment rental division (“TRS-RenTelco”); (3) its containment solutions for the storage of hazardous and non-hazardous liquids and solids division (“Adler Tanks”); and (4) its classroom manufacturing division selling modular buildings used primarily as classrooms in California (“Enviroplex”). The operations of each of these segments are described in Part I – Item 1, “Business”, and the accounting policies of the segments are described in “Note 2 – Significant Accounting Policies” in the Company’s 2011 Annual Report. Management focuses on several key measures to evaluate and assess each segment’s performance, including rental revenue growth, gross profit, income from operations and income before provision for income taxes. Excluding interest expense, allocations of revenue and expense not directly associated with one of these segments are generally allocated to Mobile Modular, TRS-RenTelco and Adler Tanks based on their pro-rata share of direct revenues. Interest expense is allocated among Mobile Modular, TRS-RenTelco and Adler Tanks based on their pro-rata share of average rental equipment at cost, intangible assets, accounts receivable, deferred income and customer security deposits. The Company does not report total assets by business segment. Summarized financial information for the nine months ended September 30, 2012 and 2011 for the Company’s reportable segments is shown in the following table:

(dollar amounts in thousands)	Mobile Modular			TRS- RenTelco			Adler Tanks			Enviroplex 1			Consolidated
Nine Months Ended September 30,
2012
Rental Revenues	$	59,414		$	74,796		$	49,117		$	—		$	183,327
Rental Related Services Revenues		19,427			2,831			12,445			—			34,703
Sales and Other Revenues		10,294			17,401			2,493			13,906			44,094
Total Revenues		89,135			95,028			64,055			13,906			262,124
Depreciation of Rental Equipment		10,437			28,280			8,519			—			47,236
Gross Profit		37,659			45,202			38,552			2,842			124,255
Selling and Administrative Expenses		25,317			19,315			15,347			3,393			63,372
Income (Loss) from Operations		12,342			25,887			23,205			(551	)		60,883
Interest Expense (Income) Allocation		3,432			1,800			1,734			(99	)		6,867
Income (Loss) before Provision for Income Taxes		8,910			24,087			21,471			(452	)		54,016
Rental Equipment Acquisitions		16,787			41,082			47,288			—			105,157
Accounts Receivable, net (period end)		46,939			22,278			23,036			8,795			101,048
Rental Equipment, at cost (period end)		549,225			274,300			246,228			—			1,069,753
Rental Equipment, net book value (period end)		385,430			113,574			220,632			—			719,636
Utilization (period end) 2		66.6	%		64.2	%		69.4	%
Average Utilization 2		66.3	%		65.8	%		72.0	%
2011
Rental Revenues	$	59,689		$	70,370		$	42,049		$	—		$	172,108
Rental Related Services Revenues		17,886			2,273			8,457			—			28,616
Sales and Other Revenues		16,835			19,103			341			20,415			56,694
Total Revenues		94,410			91,792			50,847			20,415			257,418
Depreciation of Rental Equipment		10,306			28,561			5,927			—			44,794
Gross Profit		40,970			41,515			35,053			5,014			122,552
Selling and Administrative Expenses		24,027			18,920			11,704			2,587			57,238
Income from Operations		16,943			22,595			23,349			2,427			65,314
Interest Expense (Income) Allocation		2,935			1,544			1,174			(166	)		5,487
Income before Provision for Income Taxes		14,008			21,051			22,175			2,593			59,827
Rental Equipment Acquisitions		27,556			47,454			45,846			—			120,856
Accounts Receivable, net (period end)		45,199			22,409			18,839			3,194			89,641
Rental Equipment, at cost (period end)		534,109			266,354			178,805			—			979,268
Rental Equipment, net book value (period end)		381,669			110,444			163,741			—			655,854
Utilization (period end) 2		67.0	%		66.3	%		90.5	%
Average Utilization 2		67.1	%		65.4	%		86.4	%

1. Gross Enviroplex sales revenues were $14,320 and $20,512 for the nine months ended September 30, 2012 and 2011, respectively, which includes inter-segment sales to Mobile Modular of $414 and $97, respectively, which have been eliminated in consolidation.

2. Utilization is calculated each month by dividing the cost of rental equipment on rent by the total cost of rental equipment excluding accessory equipment and for Mobile Modular and Adler Tanks excluding new equipment inventory. The Average Utilization for the period is calculated using the average costs of rental equipment.

No single customer accounted for more than 10% of total revenues for the nine months ended September 30, 2012 and 2011. Revenues from foreign country customers accounted for 10% and 7%, respectively, of the Company’s total revenues for the same periods.