Segment Reporting

3 Months Ended

Mar. 31, 2013

Segment Reporting [Abstract]

SEGMENT REPORTING

NOTE 5. 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 2012 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 three months ended March 31, 2013 and 2012 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
Three Months Ended March 31,
2013
Rental Revenues	$	19,329		$	24,841		$	16,431		$	—		$	60,601
Rental Related Services Revenues		5,914			666			4,265			—			10,845
Sales and Other Revenues		3,748			7,207			119			6,193			17,267
Total Revenues		28,991			32,714			20,815			6,193			88,713
Depreciation of Rental Equipment		3,518			9,816			3,268			—			16,602
Gross Profit		11,662			15,594			11,143			599			38,998
Selling and Administrative Expenses		8,800			6,094			5,992			752			21,638
Income (Loss) from Operations		2,862			9,500			5,151			(153	)		17,360
Interest Expense (Income) Allocation		1,093			557			609			(56	)		2,203
Income (Loss) before Provision for Income Taxes		1,769			8,943			4,542			(97	)		15,157
Rental Equipment Acquisitions		8,490			12,198			6,754			—			27,442
Accounts Receivable, net (period end)		36,259			25,627			22,049			3,091			87,026
Rental Equipment, at cost (period end)		558,471			267,411			261,483			—			1,087,365
Rental Equipment, net book value (period end)		388,960			107,683			229,457			—			726,100
Utilization (period end) 2		66.1	%		63.3	%		63.5	%
Average Utilization 2		66.4	%		63.8	%		64.7	%
2012
Rental Revenues	$	19,891		$	23,412		$	16,217		$	—		$	59,520
Rental Related Services Revenues		6,120			829			3,716			—			10,665
Sales and Other Revenues		2,344			6,256			137			7			8,744
Total Revenues		28,355			30,497			20,070			7			78,929
Depreciation of Rental Equipment		3,474			9,284			2,643			—			15,401
Gross Profit (Loss)		12,481			14,054			13,306			(6	)		39,835
Selling and Administrative Expenses		8,487			6,696			5,097			1,081			21,361
Income (Loss) from Operations		3,994			7,358			8,209			(1,087	)		18,474
Interest Expense (Income) Allocation		1,103			578			531			(39	)		2,173
Income (Loss) before Provision for Income Taxes		2,891			6,780			7,678			(1,048	)		16,301
Rental Equipment Acquisitions		4,251			12,915			22,369			—			39,535
Accounts Receivable, net (period end)		40,895			21,785			18,752			3,161			84,593
Rental Equipment, at cost (period end)		541,357			262,845			223,797			—			1,027,999
Rental Equipment, net book value (period end)		382,930			106,982			203,665			—			693,577
Utilization (period end) 2		65.7	%		65.1	%		72.9	%
Average Utilization 2		66.5	%		65.5	%%		76.5	%

1. Gross Enviroplex sales revenues were $6,193 and $7 for the three months ended March 31, 2013 and 2012, respectively. There were no inter-segment sales to Mobile Modular in these periods, which required elimination.

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 three months ended March 31, 2013 and 2012. Revenues from foreign country customers accounted for 5% and 9%, respectively, of the Company’s total revenues for the same periods.