McGrath RentCorp (“McGrath” or the “Company”) (Nasdaq: MGRC), a leading business-to-business rental company in North America, today announced total revenues for the quarter ended June 30, 2026 of $221.1 million, a decrease of 6% compared to the second quarter of 2025. The Company reported net income of $33.7 million, or $1.37 per diluted share, for the second quarter of 2026, compared to net income of $36.0 million, or $1.46 per diluted share, for the second quarter of 2025. The decreases in net income and earnings per diluted share for the quarter were primarily attributed to lower gross profit on sales revenues when compared to the second quarter of 2025.
SECOND QUARTER 2026 YEAR-OVER-YEAR COMPANY HIGHLIGHTS:
- Rental operations revenues increased 6% to $172.5 million.
- Sales revenues decreased 34% to $46.4 million.
- Total revenues decreased 6% to $221.1 million.
- Other income, net increased $1.8 million as a result of the sale of a corporate property.
- Income from operations decreased 7% to $53.3 million.
- Adjusted EBITDA1 decreased 4% to $82.8 million.
- Dividend rate of $0.495 per share for the second quarter 2026. On an annualized basis, this dividend represents a 1.7% yield on the July 28, 2026 close price of $119.98 per share.
Phil Hawkins, President and CEO of McGrath, made the following comments:
“Our strong rental operations revenues were the highlight of the second quarter and we were pleased to see momentum building in our two largest rental businesses. Both Mobile Modular and TRS grew rental revenue and improved utilization sequentially while Portable Storage rental revenues were stable. Sales revenues for the quarter were lower than a year ago, due to lower sales at Enviroplex and Mobile Modular, as delays caused several new sales projects to shift to the second half of the year.
Modular rental revenues increased 2% compared to last year, with continued growth from our commercial customer base. We experienced positive business momentum during the quarter, particularly with large commercial projects and progress with our regional expansion efforts. Shipments exceeded returns for each month of the quarter, and average utilization improved slightly from the first to second quarter.
Portable Storage rental revenues were flat as commercial construction project activity remained soft. Higher costs for equipment preparation, trucking and sales coverage continued to pressure margins in the quarter.
TRS-RenTelco had an impressive quarter, as strong market conditions supported 17% rental revenue growth. Demand was robust throughout the quarter, and the business benefited from projects supporting buildout of new data centers.
Overall, we are encouraged by our progress. Modular utilization improvement and execution on our strategic growth initiatives in the quarter set us up well for the second half of the year. While there are still some challenges in the macro environment, we remain focused on the growth levers within our control.”
DIVISION HIGHLIGHTS:
All comparisons presented below are for the quarter ended June 30, 2026 to the quarter ended June 30, 2025 unless otherwise indicated.
MOBILE MODULAR
For the second quarter of 2026, the Company’s Mobile Modular division reported Adjusted EBITDA of $50.7 million, a decrease of $2.3 million, or 4%, when compared to the same quarter in 2025.
- Rental revenues increased 2% to $81.9 million, depreciation expense increased 9% to $11.7 million and other direct costs increased 9% to $26.1 million, which resulted in a decrease in gross profit on rental revenues of 4% to $45.4 million.
- Rental related services revenues increased 8% to $34.8 million, primarily attributable to higher delivery and installation revenues, with associated gross profit increasing 8% to $12.7 million.
- Sales revenues decreased 23% to $31.2 million, primarily due to lower new equipment sales. Lower sales revenues partly offset by higher gross margin on sales of 36% in 2026, compared to 32% in 2025, resulted in a 14% decrease in gross profit on sales revenues to $11.1 million.
- Selling and administrative expenses increased 2% to $37.4 million, when compared to the prior year.
PORTABLE STORAGE
For the second quarter of 2026, the Company’s Portable Storage division reported Adjusted EBITDA of $7.6 million, a decrease of $2.2 million, or 23%, when compared to the same quarter in 2025.
- Rental revenues were comparable to 2025 at $16.9 million, depreciation expense increased 6% to $1.1 million, and other direct costs increased 18% to $2.3 million, which resulted in a decrease in gross profit on rental revenues of 4% to $13.5 million.
- Rental related services revenues increased 3% to $4.5 million, primarily attributable to higher delivery and return delivery activities. Gross margin on rental related services was negative 18% compared to 2% in 2025, primarily due to higher trucking related costs, resulting in a gross loss on rental related services revenues of $0.8 million.
- Sales revenues increased 8% to $1.9 million. Gross margin on sales was comparable to 2025 at 39%, resulting in a $0.1 million increase in gross profit on sales revenues to $0.7 million.
- Selling and administrative expenses increased 12% to $8.5 million, when compared to the prior year.
TRS-RENTELCO
For the second quarter of 2026, the Company’s TRS-RenTelco division reported Adjusted EBITDA of $25.0 million, an increase of 29% when compared to the same quarter in 2025.
- Rental revenues increased 17% to $31.8 million, depreciation expense increased 8% and other direct costs increased 10%, resulting in a 29% increase in gross profit on rental revenues to $15.3 million.
- Sales revenues increased 13% to $8.7 million and gross profit on sales revenues increased 59% to $5.8 million, primarily attributed to higher sales margins of 66% in 2026 compared to 47% in 2025.
- Selling and administrative expenses increased 13% to $8.3 million, when compared to the prior year.
FINANCIAL OUTLOOK:
Based upon the Company’s year-to-date results and current outlook for the remainder of the year, the Company is updating its financial outlook. For the full-year 2026, the Company currently expects:
|
|
|
Previous |
Current |
|
|
Total revenue: |
$945 to $995 million |
$955 to $985 million |
|
|
Adjusted EBITDA1, 2: |
$360 to $378 million |
$363 to $375 million |
|
|
Gross rental equipment capital expenditures: |
$180 to $200 million |
$200 to $220 million |
|
1. |
Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, transaction costs and non-operating transactions. A reconciliation of actual net income to Adjusted EBITDA and Adjusted EBITDA to net cash provided by operating activities can be found at the end of this release. |
|
|
2. |
Information reconciling forward-looking Adjusted EBITDA to the comparable GAAP financial measures is unavailable to the Company without unreasonable effort because certain items required for such reconciliations are outside of the Company’s control and/or cannot be reasonably predicted, such as the provision for income taxes. Therefore, no reconciliation to the most comparable GAAP measures is provided. The Company provides Adjusted EBITDA guidance because it believes that Adjusted EBITDA, when viewed with the Company’s results under GAAP, provides useful information for the reasons noted in the reconciliation of actual Adjusted EBITDA to the most directly comparable GAAP measures at the end of this release. |
ABOUT MCGRATH:
McGrath RentCorp (Nasdaq: MGRC) is a leading business-to-business rental company in North America with a strong record of profitable business growth. Founded in 1979, McGrath’s operations are centered on modular solutions through its Mobile Modular and Mobile Modular Portable Storage businesses. In addition, its TRS-RenTelco business offers electronic test equipment rental solutions. The Company’s rental product offerings and services are part of the circular supply economy, helping customers work more efficiently, and sustainably manage their environmental footprint. With over 40 years of experience, McGrath’s success is driven by a focus on exceptional customer experiences. This focus has underpinned the Company’s long-term financial success and supported 35 consecutive years of annual dividend increases to shareholders, a rare distinction among publicly listed companies.
McGrath is headquartered in Livermore, California. Additional information about McGrath and its businesses is available at mgrc.com and investors.mgrc.com.
You should read this press release in conjunction with the financial statements and notes thereto included in the Company’s latest Forms 10-K, 10-Q and other SEC filings. You can visit the Company’s website at www.mgrc.com to access information on McGrath RentCorp, including the latest Forms 10-K, 10-Q and other SEC filings.
CONFERENCE CALL NOTE:
As previously announced in its press release of June 25, 2026, McGrath RentCorp will host a conference call at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) on July 29, 2026 to discuss the second quarter 2026 results. To participate in the teleconference, dial 1-800-274-8461 (in the U.S.), or 1-203-518-9814 (outside the U.S.), or to listen only, access the simultaneous webcast at the investor relations section of the Company’s website at https://investors.mgrc.com/. A replay will be available for 7 days following the call by dialing 1-800-839-5203 (in the U.S.), or 1-402-220-2695 (outside the U.S.). In addition, a live audio webcast and replay of the call may be found in the investor relations section of the Company’s website at https://investors.mgrc.com/events-and-presentations.
FORWARD-LOOKING STATEMENTS:
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, regarding McGrath RentCorp’s expectations, strategies, prospects or targets are forward-looking statements. These forward-looking statements also can be identified by the use of forward-looking terminology such as “anticipates,” “believes,” “continues,” “could,” “estimates,” “expects,” “intends,” “may,” “plan,” “predict,” “project,” or “will,” or the negative of these terms or other comparable terminology. In particular, the discussion under the heading “Financial Outlook” and Mr. Hawkins’ comments about being encouraged by the Company’s progress, that the Company is set up well for the second half of the year and that the Company remains focused on the growth levers within its business, are forward looking.
These forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties that could cause our actual results to differ materially from those projected including: our expectations around continued business momentum entering the second half of 2026; the continued impact of tariff actions and macroeconomic factors, including fiscal policy uncertainty, government budgetary constraints, other political, geopolitical or regulatory developments; health of the education and commercial markets in our modular building division; competition within the modular business; the activity levels in the semiconductor and general purpose and communications test equipment markets at TRS-RenTelco; the activity levels in commercial construction projects and impact on Portable Storage segment; continued execution of our strategic performance improvement initiatives; our ability to successfully increase prices to offset cost increases; our ability to effectively manage our rental assets; and our ability to retain and attract talent and uncertainty associated with the Chief Executive Officer transition; as well as the other factors disclosed under “Risk Factors” in the Company’s 2025 Form 10-K and other SEC filings.
Forward-looking statements are made only as of the date hereof and are based on management’s reasonable assumptions, however these assumptions can be wrong or affected by known or unknown risks and uncertainties. No forward-looking statement can be guaranteed, and subsequent facts or circumstances may contradict, obviate, undermine or otherwise fail to support or substantiate such statements. Except as otherwise required by law, we assume no obligation to update any of the forward-looking statements contained in this press release.
|
MCGRATH RENTCORP CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) |
||||||||||||||||
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
(in thousands, except per share amounts) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Rental |
|
$ |
131,880 |
|
|
$ |
125,985 |
|
|
$ |
258,541 |
|
|
$ |
246,098 |
|
|
Rental related services |
|
|
40,617 |
|
|
|
37,483 |
|
|
|
76,190 |
|
|
|
71,399 |
|
|
Rental operations |
|
|
172,497 |
|
|
|
163,468 |
|
|
|
334,731 |
|
|
|
317,497 |
|
|
Sales |
|
|
46,355 |
|
|
|
69,775 |
|
|
|
80,390 |
|
|
|
108,701 |
|
|
Other |
|
|
2,260 |
|
|
|
2,373 |
|
|
|
4,533 |
|
|
|
4,834 |
|
|
Total revenues |
|
|
221,112 |
|
|
|
235,616 |
|
|
|
419,654 |
|
|
|
431,032 |
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Depreciation of rental equipment |
|
|
23,228 |
|
|
|
21,426 |
|
|
|
45,943 |
|
|
|
42,931 |
|
|
Rental related services |
|
|
28,376 |
|
|
|
25,477 |
|
|
|
53,493 |
|
|
|
49,790 |
|
|
Other |
|
|
34,476 |
|
|
|
31,519 |
|
|
|
66,606 |
|
|
|
59,171 |
|
|
Total direct costs of rental operations |
|
|
86,080 |
|
|
|
78,422 |
|
|
|
166,042 |
|
|
|
151,892 |
|
|
Costs of sales |
|
|
27,125 |
|
|
|
46,480 |
|
|
|
48,815 |
|
|
|
71,990 |
|
|
Total costs of revenues |
|
|
113,205 |
|
|
|
124,902 |
|
|
|
214,857 |
|
|
|
223,882 |
|
|
Gross profit |
|
|
107,907 |
|
|
|
110,714 |
|
|
|
204,797 |
|
|
|
207,150 |
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Selling and administrative expenses |
|
|
56,436 |
|
|
|
53,543 |
|
|
|
109,924 |
|
|
|
104,412 |
|
|
Other income, net |
|
|
(1,814 |
) |
|
|
— |
|
|
|
(1,814 |
) |
|
|
— |
|
|
Income from operations |
|
|
53,285 |
|
|
|
57,171 |
|
|
|
96,687 |
|
|
|
102,738 |
|
|
Interest expense |
|
|
7,113 |
|
|
|
7,795 |
|
|
|
13,613 |
|
|
|
15,954 |
|
|
Foreign currency exchange loss (gain) |
|
|
38 |
|
|
|
(81 |
) |
|
|
71 |
|
|
|
(86 |
) |
|
Income before provision for income taxes |
|
|
46,134 |
|
|
|
49,457 |
|
|
|
83,003 |
|
|
|
86,870 |
|
|
Provision for income taxes |
|
|
12,462 |
|
|
|
13,484 |
|
|
|
22,298 |
|
|
|
22,689 |
|
|
Net income |
|
$ |
33,672 |
|
|
$ |
35,973 |
|
|
$ |
60,705 |
|
|
$ |
64,181 |
|
|
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Basic |
|
$ |
1.38 |
|
|
$ |
1.46 |
|
|
$ |
2.47 |
|
|
$ |
2.61 |
|
|
Diluted |
|
$ |
1.37 |
|
|
$ |
1.46 |
|
|
$ |
2.47 |
|
|
$ |
2.61 |
|
|
Shares used in per share calculation: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Basic |
|
|
24,479 |
|
|
|
24,611 |
|
|
|
24,547 |
|
|
|
24,592 |
|
|
Diluted |
|
|
24,494 |
|
|
|
24,618 |
|
|
|
24,579 |
|
|
|
24,620 |
|
|
Cash dividends declared per share |
|
$ |
0.495 |
|
|
$ |
0.485 |
|
|
$ |
0.990 |
|
|
$ |
0.970 |
|
|
MCGRATH RENTCORP CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
||||||||
|
|
|
June 30, |
|
|
December 31, |
|
||
|
(in thousands) |
|
2026 |
|
|
2025 |
|
||
|
Assets |
|
|
|
|
|
|
||
|
Cash |
|
$ |
4,379 |
|
|
$ |
295 |
|
|
Accounts receivable, net of allowance for credit losses of $2,700 at June 30, 2026 and $2,866 at December 31, 2025 |
|
|
240,022 |
|
|
|
231,865 |
|
|
Rental equipment, at cost: |
|
|
|
|
|
|
||
|
Relocatable modular buildings |
|
|
1,565,877 |
|
|
|
1,485,794 |
|
|
Portable storage containers |
|
|
245,641 |
|
|
|
245,141 |
|
|
Electronic test equipment |
|
|
358,872 |
|
|
|
337,100 |
|
|
|
|
|
2,170,390 |
|
|
|
2,068,035 |
|
|
Less: accumulated depreciation |
|
|
(670,655 |
) |
|
|
(647,137 |
) |
|
Rental equipment, net |
|
|
1,499,735 |
|
|
|
1,420,898 |
|
|
Property, plant and equipment, net |
|
|
247,757 |
|
|
|
233,492 |
|
|
Inventories |
|
|
15,178 |
|
|
|
8,027 |
|
|
Prepaid expenses and other assets |
|
|
117,000 |
|
|
|
83,351 |
|
|
Intangible assets, net |
|
|
41,630 |
|
|
|
46,605 |
|
|
Goodwill |
|
|
337,348 |
|
|
|
332,584 |
|
|
Total assets |
|
$ |
2,503,049 |
|
|
$ |
2,357,117 |
|
|
Liabilities and Shareholders’ Equity |
|
|
|
|
|
|
||
|
Liabilities: |
|
|
|
|
|
|
||
|
Notes payable |
|
$ |
589,895 |
|
|
$ |
514,924 |
|
|
Accounts payable |
|
|
73,643 |
|
|
|
66,233 |
|
|
Accrued liabilities |
|
|
131,421 |
|
|
|
114,764 |
|
|
Deferred income |
|
|
140,314 |
|
|
|
110,593 |
|
|
Deferred income taxes, net |
|
|
322,317 |
|
|
|
313,580 |
|
|
Total liabilities |
|
|
1,257,590 |
|
|
|
1,120,094 |
|
|
Shareholders’ equity: |
|
|
|
|
|
|
||
|
Common stock, no par value – Authorized 40,000 shares |
|
|
|
|
|
|
||
|
Issued and outstanding – 24,426 shares as of June 30, 2026 and 24,612 shares as of December 31, 2025 |
|
|
120,228 |
|
|
|
121,785 |
|
|
Retained earnings |
|
|
1,125,231 |
|
|
|
1,115,238 |
|
|
Total shareholders’ equity |
|
|
1,245,459 |
|
|
|
1,237,023 |
|
|
Total liabilities and shareholders’ equity |
|
$ |
2,503,049 |
|
|
$ |
2,357,117 |
|
|
|
|
|
|
|
|
|
||
|
MCGRATH RENTCORP CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
||||||||
|
|
|
Six Months Ended June 30, |
|
|||||
|
(in thousands) |
|
2026 |
|
|
2025 |
|
||
|
Cash Flows from Operating Activities: |
|
|
|
|
|
|
||
|
Net income |
|
$ |
60,705 |
|
|
$ |
64,181 |
|
|
Adjustments to reconcile net income to net cash provided by |
|
|
|
|
|
|
||
|
Depreciation and amortization |
|
|
56,280 |
|
|
|
52,739 |
|
|
Deferred income taxes |
|
|
6,792 |
|
|
|
12,764 |
|
|
Provision for credit losses |
|
|
569 |
|
|
|
826 |
|
|
Share-based compensation |
|
|
5,679 |
|
|
|
5,322 |
|
|
Gain on sale of property, plant and equipment |
|
|
(1,814 |
) |
|
|
— |
|
|
Gain on sale of used rental equipment |
|
|
(18,035 |
) |
|
|
(16,674 |
) |
|
Foreign currency exchange loss (gain) |
|
|
71 |
|
|
|
(86 |
) |
|
Amortization of debt issuance costs |
|
|
5 |
|
|
|
45 |
|
|
Change in: |
|
|
|
|
|
|
||
|
Accounts receivable |
|
|
(8,580 |
) |
|
|
(15,285 |
) |
|
Inventories |
|
|
(7,151 |
) |
|
|
2,007 |
|
|
Prepaid expenses and other assets |
|
|
(33,578 |
) |
|
|
(5,270 |
) |
|
Accounts payable |
|
|
(30 |
) |
|
|
(8,402 |
) |
|
Accrued liabilities |
|
|
15,058 |
|
|
|
2,403 |
|
|
Deferred income |
|
|
29,721 |
|
|
|
15,124 |
|
|
Net cash provided by operating activities |
|
|
105,692 |
|
|
|
109,694 |
|
|
Cash Flows from Investing Activities: |
|
|
|
|
|
|
||
|
Purchases of rental equipment |
|
|
(124,038 |
) |
|
|
(50,230 |
) |
|
Purchases of property, plant and equipment |
|
|
(19,397 |
) |
|
|
(21,621 |
) |
|
Cash paid for acquisition of businesses, net of cash received |
|
|
(9,385 |
) |
|
|
(21,947 |
) |
|
Proceeds from sales of used rental equipment |
|
|
31,646 |
|
|
|
32,200 |
|
|
Proceeds from sales of property, plant and equipment |
|
|
2,750 |
|
|
|
— |
|
|
Net cash used in investing activities |
|
|
(118,424 |
) |
|
|
(61,598 |
) |
|
Cash Flows from Financing Activities: |
|
|
|
|
|
|
||
|
Net borrowings (payments) under bank lines of credit |
|
|
134,966 |
|
|
|
(17,730 |
) |
|
Principal payment of Series E senior notes |
|
|
(60,000 |
) |
|
|
— |
|
|
Repurchase of common stock |
|
|
(27,456 |
) |
|
|
— |
|
|
Taxes paid related to net share settlement of stock awards |
|
|
(6,032 |
) |
|
|
(5,684 |
) |
|
Payment of dividends |
|
|
(24,662 |
) |
|
|
(24,020 |
) |
|
Net cash provided by (used in) financing activities |
|
|
16,816 |
|
|
|
(47,434 |
) |
|
Net increase in cash |
|
|
4,084 |
|
|
|
662 |
|
|
Cash balance, beginning of period |
|
|
295 |
|
|
|
807 |
|
|
Cash balance, end of period |
|
$ |
4,379 |
|
|
$ |
1,469 |
|
|
Supplemental Disclosure of Cash Flow Information: |
|
|
|
|
|
|
||
|
Interest paid, during the period |
|
$ |
13,258 |
|
|
$ |
15,982 |
|
|
Net income taxes paid, during the period |
|
$ |
19,780 |
|
|
$ |
5,786 |
|
|
Dividends accrued during the period, not yet paid |
|
$ |
12,543 |
|
|
$ |
12,443 |
|
|
Rental equipment acquisitions, not yet paid |
|
$ |
19,047 |
|
|
$ |
8,658 |
|
|
Business acquisition payments withheld |
|
$ |
1,249 |
|
|
$ |
1,815 |
|
|
|
|
|
|
|
|
|
||
|
MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Three months ended June 30, 2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
(dollar amounts in thousands) |
|
Mobile Modular |
|
Portable Storage |
|
TRS-RenTelco |
|
Enviroplex |
|
Consolidated |
||||||||||
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
$ |
83,181 |
|
|
$ |
16,856 |
|
|
$ |
31,843 |
|
|
$ |
— |
|
|
$ |
131,880 |
|
|
Rental related services |
|
|
34,794 |
|
|
|
4,540 |
|
|
|
1,283 |
|
|
|
— |
|
|
|
40,617 |
|
|
Rental operations |
|
|
117,975 |
|
|
|
21,396 |
|
|
|
33,126 |
|
|
|
— |
|
|
|
172,497 |
|
|
Sales |
|
|
31,179 |
|
|
|
1,853 |
|
|
|
8,707 |
|
|
|
4,616 |
|
|
|
46,355 |
|
|
Other |
|
|
1,270 |
|
|
|
270 |
|
|
|
720 |
|
|
|
— |
|
|
|
2,260 |
|
|
Total revenues |
|
|
150,424 |
|
|
|
23,519 |
|
|
|
42,553 |
|
|
|
4,616 |
|
|
|
221,112 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Depreciation |
|
|
11,709 |
|
|
|
1,104 |
|
|
|
10,415 |
|
|
|
— |
|
|
|
23,228 |
|
|
Rental related services |
|
|
22,134 |
|
|
|
5,352 |
|
|
|
890 |
|
|
|
— |
|
|
|
28,376 |
|
|
Other |
|
|
26,052 |
|
|
|
2,265 |
|
|
|
6,159 |
|
|
|
— |
|
|
|
34,476 |
|
|
Total direct costs of rental operations |
|
|
59,895 |
|
|
|
8,721 |
|
|
|
17,464 |
|
|
|
— |
|
|
|
86,080 |
|
|
Costs of sales |
|
|
20,062 |
|
|
|
1,126 |
|
|
|
2,926 |
|
|
|
3,011 |
|
|
|
27,125 |
|
|
Total costs of revenues |
|
|
79,957 |
|
|
|
9,847 |
|
|
|
20,390 |
|
|
|
3,011 |
|
|
|
113,205 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Gross Profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
|
45,420 |
|
|
|
13,487 |
|
|
|
15,269 |
|
|
|
— |
|
|
|
74,176 |
|
|
Rental related services |
|
|
12,660 |
|
|
|
(812 |
) |
|
|
393 |
|
|
|
— |
|
|
|
12,241 |
|
|
Rental operations |
|
|
58,080 |
|
|
|
12,675 |
|
|
|
15,662 |
|
|
|
— |
|
|
|
86,417 |
|
|
Sales |
|
|
11,117 |
|
|
|
727 |
|
|
|
5,781 |
|
|
|
1,605 |
|
|
|
19,230 |
|
|
Other |
|
|
1,270 |
|
|
|
270 |
|
|
|
720 |
|
|
|
— |
|
|
|
2,260 |
|
|
Total gross profit |
|
|
70,467 |
|
|
|
13,672 |
|
|
|
22,163 |
|
|
|
1,605 |
|
|
|
107,907 |
|
|
Selling and administrative expenses |
|
|
37,448 |
|
|
|
8,488 |
|
|
|
8,262 |
|
|
|
2,238 |
|
|
|
56,436 |
|
|
Income from operations |
|
$ |
33,019 |
|
|
$ |
5,184 |
|
|
$ |
13,901 |
|
|
$ |
(633 |
) |
|
|
51,471 |
|
|
Other income, net 6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,814 |
) |
||||
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,113 |
|
||||
|
Foreign currency exchange gain |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
38 |
|
||||
|
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,462 |
|
||||
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
33,672 |
|
||||
|
Other Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Adjusted EBITDA 1 |
|
$ |
50,740 |
|
|
$ |
7,588 |
|
|
$ |
24,993 |
|
|
$ |
(524 |
) |
|
$ |
82,797 |
|
|
Average rental equipment 2 |
|
$ |
1,421,497 |
|
|
$ |
242,947 |
|
|
$ |
344,717 |
|
|
|
|
|
|
|
||
|
Average monthly total yield 3 |
|
|
1.95 |
% |
|
|
2.31 |
% |
|
|
3.08 |
% |
|
|
|
|
|
|
||
|
Average utilization 4 |
|
|
70.1 |
% |
|
|
58.3 |
% |
|
|
68.1 |
% |
|
|
|
|
|
|
||
|
Average monthly rental rate 5 |
|
|
2.78 |
% |
|
|
3.97 |
% |
|
|
4.52 |
% |
|
|
|
|
|
|
||
|
1. |
Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, other income, net and non-operating transactions. |
|
|
2. |
Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment. |
|
|
3. |
Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period. |
|
|
4. |
Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment. |
|
|
5. |
Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period. |
|
|
6. |
During the quarter ended June 30, 2026, the Company sold a corporate property which resulted in a net gain on sale of $1,814, excluding taxes. |
| MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Three months ended June 30, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
(dollar amounts in thousands) |
|
Mobile Modular |
|
Portable Storage |
|
TRS-RenTelco |
|
Enviroplex |
|
Consolidated |
||||||||||
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
$ |
81,909 |
|
|
$ |
16,939 |
|
|
$ |
27,137 |
|
|
$ |
— |
|
|
$ |
125,985 |
|
|
Rental related services |
|
|
32,172 |
|
|
|
4,394 |
|
|
|
917 |
|
|
|
— |
|
|
|
37,483 |
|
|
Rental operations |
|
|
114,081 |
|
|
|
21,333 |
|
|
|
28,054 |
|
|
|
— |
|
|
|
163,468 |
|
|
Sales |
|
|
40,484 |
|
|
|
1,712 |
|
|
|
7,713 |
|
|
|
19,866 |
|
|
|
69,775 |
|
|
Other |
|
|
1,423 |
|
|
|
301 |
|
|
|
649 |
|
|
|
— |
|
|
|
2,373 |
|
|
Total revenues |
|
|
155,988 |
|
|
|
23,346 |
|
|
|
36,416 |
|
|
|
19,866 |
|
|
|
235,616 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Depreciation |
|
|
10,741 |
|
|
|
1,038 |
|
|
|
9,647 |
|
|
|
— |
|
|
|
21,426 |
|
|
Rental related services |
|
|
20,450 |
|
|
|
4,304 |
|
|
|
723 |
|
|
|
— |
|
|
|
25,477 |
|
|
Other |
|
|
23,990 |
|
|
|
1,918 |
|
|
|
5,611 |
|
|
|
— |
|
|
|
31,519 |
|
|
Total direct costs of rental operations |
|
|
55,181 |
|
|
|
7,260 |
|
|
|
15,981 |
|
|
|
— |
|
|
|
78,422 |
|
|
Costs of sales |
|
|
27,581 |
|
|
|
1,048 |
|
|
|
4,072 |
|
|
|
13,779 |
|
|
|
46,480 |
|
|
Total costs of revenues |
|
|
82,762 |
|
|
|
8,308 |
|
|
|
20,053 |
|
|
|
13,779 |
|
|
|
124,902 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Gross Profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
|
47,178 |
|
|
|
13,983 |
|
|
|
11,879 |
|
|
|
— |
|
|
|
73,040 |
|
|
Rental related services |
|
|
11,722 |
|
|
|
90 |
|
|
|
194 |
|
|
|
— |
|
|
|
12,006 |
|
|
Rental operations |
|
|
58,900 |
|
|
|
14,073 |
|
|
|
12,073 |
|
|
|
— |
|
|
|
85,046 |
|
|
Sales |
|
|
12,903 |
|
|
|
664 |
|
|
|
3,641 |
|
|
|
6,087 |
|
|
|
23,295 |
|
|
Other |
|
|
1,423 |
|
|
|
301 |
|
|
|
649 |
|
|
|
— |
|
|
|
2,373 |
|
|
Total gross profit |
|
|
73,226 |
|
|
|
15,038 |
|
|
|
16,363 |
|
|
|
6,087 |
|
|
|
110,714 |
|
|
Selling and administrative expenses |
|
|
36,777 |
|
|
|
7,547 |
|
|
|
7,320 |
|
|
|
1,899 |
|
|
|
53,543 |
|
|
Income from operations |
|
$ |
36,449 |
|
|
$ |
7,491 |
|
|
$ |
9,043 |
|
|
$ |
4,188 |
|
|
$ |
57,171 |
|
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,795 |
|
||||
|
Foreign currency exchange gain |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(81 |
) |
||||
|
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,484 |
|
||||
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
35,973 |
|
||||
|
Other Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Adjusted EBITDA 1 |
|
$ |
53,088 |
|
|
$ |
9,834 |
|
|
$ |
19,314 |
|
|
$ |
4,290 |
|
|
$ |
86,525 |
|
|
Average rental equipment 2 |
|
$ |
1,300,787 |
|
|
$ |
233,742 |
|
|
$ |
330,532 |
|
|
|
|
|
|
|
||
|
Average monthly total yield 3 |
|
|
2.10 |
% |
|
|
2.42 |
% |
|
|
2.74 |
% |
|
|
|
|
|
|
||
|
Average utilization 4 |
|
|
73.7 |
% |
|
|
61.1 |
% |
|
|
64.8 |
% |
|
|
|
|
|
|
||
|
Average monthly rental rate 5 |
|
|
2.85 |
% |
|
|
3.95 |
% |
|
|
4.22 |
% |
|
|
|
|
|
|
||
|
1. |
Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, other income, net and non-operating transactions. |
|
|
2. |
Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment. |
|
|
3. |
Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period. |
|
|
4. |
Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment. |
|
|
5. |
Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period. |
| MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Six months ended June 30, 2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
(dollar amounts in thousands) |
|
Mobile Modular |
|
Portable Storage |
|
TRS-RenTelco |
|
Enviroplex |
|
Consolidated |
||||||||||
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
$ |
164,618 |
|
|
$ |
33,139 |
|
|
$ |
60,784 |
|
|
$ |
— |
|
|
$ |
258,541 |
|
|
Rental related services |
|
|
65,554 |
|
|
|
8,383 |
|
|
|
2,253 |
|
|
|
— |
|
|
|
76,190 |
|
|
Rental operations |
|
|
230,172 |
|
|
|
41,522 |
|
|
|
63,037 |
|
|
|
— |
|
|
|
334,731 |
|
|
Sales |
|
|
52,073 |
|
|
|
3,458 |
|
|
|
16,739 |
|
|
|
8,120 |
|
|
|
80,390 |
|
|
Other |
|
|
2,581 |
|
|
|
469 |
|
|
|
1,483 |
|
|
|
— |
|
|
|
4,533 |
|
|
Total revenues |
|
|
284,826 |
|
|
|
45,449 |
|
|
|
81,259 |
|
|
|
8,120 |
|
|
|
419,654 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Depreciation |
|
|
23,367 |
|
|
|
2,196 |
|
|
|
20,380 |
|
|
|
— |
|
|
|
45,943 |
|
|
Rental related services |
|
|
41,869 |
|
|
|
9,945 |
|
|
|
1,679 |
|
|
|
— |
|
|
|
53,493 |
|
|
Other |
|
|
50,023 |
|
|
|
4,373 |
|
|
|
12,210 |
|
|
|
— |
|
|
|
66,606 |
|
|
Total direct costs of rental operations |
|
|
115,259 |
|
|
|
16,514 |
|
|
|
34,269 |
|
|
|
— |
|
|
|
166,042 |
|
|
Costs of sales |
|
|
34,387 |
|
|
|
2,149 |
|
|
|
6,562 |
|
|
|
5,717 |
|
|
|
48,815 |
|
|
Total costs of revenues |
|
|
149,646 |
|
|
|
18,663 |
|
|
|
40,831 |
|
|
|
5,717 |
|
|
|
214,857 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Gross Profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
|
91,228 |
|
|
|
26,570 |
|
|
|
28,194 |
|
|
|
— |
|
|
|
145,992 |
|
|
Rental related services |
|
|
23,685 |
|
|
|
(1,562 |
) |
|
|
574 |
|
|
|
— |
|
|
|
22,697 |
|
|
Rental operations |
|
|
114,913 |
|
|
|
25,008 |
|
|
|
28,768 |
|
|
|
— |
|
|
|
168,689 |
|
|
Sales |
|
|
17,686 |
|
|
|
1,309 |
|
|
|
10,177 |
|
|
|
2,403 |
|
|
|
31,575 |
|
|
Other |
|
|
2,581 |
|
|
|
469 |
|
|
|
1,483 |
|
|
|
— |
|
|
|
4,533 |
|
|
Total gross profit |
|
|
135,180 |
|
|
|
26,786 |
|
|
|
40,428 |
|
|
|
2,403 |
|
|
|
204,797 |
|
|
Selling and administrative expenses |
|
|
72,612 |
|
|
|
16,863 |
|
|
|
16,253 |
|
|
|
4,196 |
|
|
|
109,924 |
|
|
Income from operations |
|
$ |
62,568 |
|
|
$ |
9,923 |
|
|
$ |
24,175 |
|
|
$ |
(1,793 |
) |
|
|
94,873 |
|
|
Other income, net 6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,814 |
) |
||||
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,613 |
|
||||
|
Foreign currency exchange loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
71 |
|
||||
|
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,298 |
|
||||
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
60,705 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Adjusted EBITDA 1 |
|
$ |
97,923 |
|
|
$ |
14,728 |
|
|
$ |
45,849 |
|
|
$ |
(1,576 |
) |
|
$ |
156,924 |
|
|
Average rental equipment 2 |
|
$ |
1,403,928 |
|
|
$ |
242,855 |
|
|
$ |
339,564 |
|
|
|
|
|
|
|
||
|
Average monthly total yield 3 |
|
|
1.95 |
% |
|
|
2.27 |
% |
|
|
2.98 |
% |
|
|
|
|
|
|
||
|
Average utilization 4 |
|
|
70.1 |
% |
|
|
58.4 |
% |
|
|
66.9 |
% |
|
|
|
|
|
|
||
|
Average monthly rental rate 5 |
|
|
2.79 |
% |
|
|
3.90 |
% |
|
|
4.46 |
% |
|
|
|
|
|
|
||
|
1. |
Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, other income, net and non-operating transactions. |
|
|
2. |
Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment. |
|
|
3. |
Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period. |
|
|
4. |
Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment. |
|
|
5. |
Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period. |
|
|
6. |
During the six months ended June 30, 2026, the Company sold a corporate property which resulted in a net gain on sale of $1,814, excluding taxes. |
| MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Six months ended June 30, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
(dollar amounts in thousands) |
|
Mobile Modular |
|
Portable Storage |
|
TRS-RenTelco |
|
Enviroplex |
|
Consolidated |
||||||||||
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
$ |
160,404 |
|
|
$ |
33,014 |
|
|
$ |
52,680 |
|
|
$ |
— |
|
|
$ |
246,098 |
|
|
Rental related services |
|
|
61,647 |
|
|
|
8,025 |
|
|
|
1,727 |
|
|
|
— |
|
|
|
71,399 |
|
|
Rental operations |
|
|
222,051 |
|
|
|
41,039 |
|
|
|
54,407 |
|
|
|
— |
|
|
|
317,497 |
|
|
Sales |
|
|
62,974 |
|
|
|
2,956 |
|
|
|
15,692 |
|
|
|
27,079 |
|
|
|
108,701 |
|
|
Other |
|
|
2,881 |
|
|
|
617 |
|
|
|
1,336 |
|
|
|
— |
|
|
|
4,834 |
|
|
Total revenues |
|
|
287,906 |
|
|
|
44,612 |
|
|
|
71,435 |
|
|
|
27,079 |
|
|
|
431,032 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Depreciation |
|
|
21,294 |
|
|
|
2,070 |
|
|
|
19,567 |
|
|
|
— |
|
|
|
42,931 |
|
|
Rental related services |
|
|
40,190 |
|
|
|
8,237 |
|
|
|
1,363 |
|
|
|
— |
|
|
|
49,790 |
|
|
Other |
|
|
44,802 |
|
|
|
3,445 |
|
|
|
10,924 |
|
|
|
— |
|
|
|
59,171 |
|
|
Total direct costs of rental operations |
|
|
106,286 |
|
|
|
13,752 |
|
|
|
31,854 |
|
|
|
— |
|
|
|
151,892 |
|
|
Costs of sales |
|
|
42,926 |
|
|
|
1,879 |
|
|
|
8,343 |
|
|
|
18,842 |
|
|
|
71,990 |
|
|
Total costs of revenues |
|
|
149,212 |
|
|
|
15,631 |
|
|
|
40,197 |
|
|
|
18,842 |
|
|
|
223,882 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Gross Profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Rental |
|
|
94,308 |
|
|
|
27,499 |
|
|
|
22,189 |
|
|
|
— |
|
|
|
143,996 |
|
|
Rental related services |
|
|
21,457 |
|
|
|
(212 |
) |
|
|
364 |
|
|
|
— |
|
|
|
21,609 |
|
|
Rental operations |
|
|
115,765 |
|
|
|
27,287 |
|
|
|
22,553 |
|
|
|
— |
|
|
|
165,605 |
|
|
Sales |
|
|
20,048 |
|
|
|
1,077 |
|
|
|
7,349 |
|
|
|
8,237 |
|
|
|
36,711 |
|
|
Other |
|
|
2,881 |
|
|
|
617 |
|
|
|
1,336 |
|
|
|
— |
|
|
|
4,834 |
|
|
Total gross profit |
|
|
138,694 |
|
|
|
28,981 |
|
|
|
31,238 |
|
|
|
8,237 |
|
|
|
207,150 |
|
|
Selling and administrative expenses |
|
|
70,765 |
|
|
|
15,101 |
|
|
|
14,758 |
|
|
|
3,788 |
|
|
|
104,412 |
|
|
Income from operations |
|
$ |
67,929 |
|
|
$ |
13,880 |
|
|
$ |
16,480 |
|
|
$ |
4,449 |
|
|
|
102,738 |
|
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,954 |
|
||||
|
Foreign currency exchange gain |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(86 |
) |
||||
|
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,689 |
|
||||
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
64,181 |
|
||||
|
Other Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Adjusted EBITDA 1 |
|
$ |
100,719 |
|
|
$ |
18,421 |
|
|
$ |
37,248 |
|
|
$ |
4,653 |
|
|
$ |
161,041 |
|
|
Average rental equipment 2 |
|
$ |
1,292,797 |
|
|
$ |
233,501 |
|
|
$ |
334,607 |
|
|
|
|
|
|
|
||
|
Average monthly total yield 3 |
|
|
2.07 |
% |
|
|
2.36 |
% |
|
|
2.62 |
% |
|
|
|
|
|
|
||
|
Average utilization 4 |
|
|
74.2 |
% |
|
|
60.6 |
% |
|
|
63.0 |
% |
|
|
|
|
|
|
||
|
Average monthly rental rate 5 |
|
|
2.79 |
% |
|
|
3.89 |
% |
|
|
4.17 |
% |
|
|
|
|
|
|
||
|
1. |
Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, other income, net and non-operating transactions. |
|
|
2. |
Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment. |
|
|
3. |
Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period. |
|
|
4. |
Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment. |
|
|
5. |
Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period. |
Reconciliation of Adjusted EBITDA to the most directly comparable GAAP measures
To supplement the Company’s financial data presented on a basis consistent with accounting principles generally accepted in the United States of America (“GAAP”), the Company presents “Adjusted EBITDA”, which is defined by the Company as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, transaction costs, gains on property sales and non-operating transactions. The Company presents Adjusted EBITDA as a financial measure as management believes it provides useful information to investors regarding the Company’s liquidity and financial condition and because management, as well as the Company’s lenders, use this measure in evaluating the performance of the Company.
Management uses Adjusted EBITDA as a supplement to GAAP measures to further evaluate period-to-period operating performance, compliance with financial covenants in the Company’s revolving lines of credit and senior notes and the Company’s ability to meet future capital expenditure and working capital requirements. Management believes the exclusion of non-cash charges and non-recurring transactions, including share-based compensation, transaction costs and gains on property sales is useful in measuring the Company’s cash available for operations and performance of the Company. Because management finds Adjusted EBITDA useful, the Company believes its investors will also find Adjusted EBITDA useful in evaluating the Company’s performance.
Adjusted EBITDA should not be considered in isolation or as a substitute for net income, cash flows, or other consolidated income or cash flow data prepared in accordance with GAAP or as a measure of the Company’s profitability or liquidity. Adjusted EBITDA is not in accordance with or an alternative for GAAP and may be different from non−GAAP measures used by other companies. Unlike EBITDA, which may be used by other companies or investors, Adjusted EBITDA does not include share-based compensation charges, transaction costs, gains on property sales and non-operating transactions. The Company believes that Adjusted EBITDA is of limited use in that it does not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP and does not accurately reflect real cash flow. In addition, other companies may not use Adjusted EBITDA or may use other non-GAAP measures, limiting the usefulness of Adjusted EBITDA for purposes of comparison. The Company’s presentation of Adjusted EBITDA should not be construed as an inference that the Company will not incur expenses that are the same as or similar to the adjustments in this presentation. Therefore, Adjusted EBITDA should only be used to evaluate the Company’s results of operations in conjunction with the corresponding GAAP measures. The Company compensates for the limitations of Adjusted EBITDA by relying upon GAAP results to gain a complete picture of the Company’s performance. Because Adjusted EBITDA is a non-GAAP financial measure, as defined by the SEC, the Company includes in the tables below reconciliations of Adjusted EBITDA to the most directly comparable financial measures calculated and presented in accordance with GAAP.
|
Reconciliation of Net Income to Adjusted EBITDA |
|||||||||||||||||||||||
|
(dollar amounts in thousands) |
Three Months Ended |
|
|
Six Months Ended |
|
|
Twelve Months Ended |
|
|||||||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||
|
Net income |
$ |
33,671 |
|
|
$ |
35,973 |
|
|
$ |
60,704 |
|
|
$ |
64,182 |
|
|
$ |
152,830 |
|
|
$ |
252,448 |
|
|
Provision for income taxes |
|
12,462 |
|
|
|
13,484 |
|
|
|
22,298 |
|
|
|
22,689 |
|
|
|
56,382 |
|
|
|
89,202 |
|
|
Interest expense |
|
7,112 |
|
|
|
7,795 |
|
|
|
13,613 |
|
|
|
15,954 |
|
|
|
28,281 |
|
|
|
37,454 |
|
|
Depreciation and amortization |
|
28,456 |
|
|
|
26,339 |
|
|
|
56,280 |
|
|
|
52,739 |
|
|
|
110,610 |
|
|
|
106,063 |
|
|
EBITDA |
|
81,701 |
|
|
|
83,591 |
|
|
|
152,895 |
|
|
|
155,564 |
|
|
|
348,103 |
|
|
|
485,167 |
|
|
Share-based compensation |
|
2,857 |
|
|
|
2,779 |
|
|
|
5,679 |
|
|
|
5,322 |
|
|
|
11,582 |
|
|
|
10,268 |
|
|
Transaction costs 3 |
|
53 |
|
|
|
155 |
|
|
|
164 |
|
|
|
155 |
|
|
|
475 |
|
|
|
41,593 |
|
|
Other income, net 4 |
|
(1,814 |
) |
|
|
— |
|
|
|
(1,814 |
) |
|
|
— |
|
|
|
(1,814 |
) |
|
|
— |
|
|
Gain on merger termination from WillScot Mobile Mini 5 |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(180,000 |
) |
|
Adjusted EBITDA 1 |
$ |
82,797 |
|
|
$ |
86,525 |
|
|
$ |
156,924 |
|
|
$ |
161,041 |
|
|
$ |
358,348 |
|
|
$ |
357,028 |
|
|
Adjusted EBITDA margin 2 |
|
37 |
% |
|
|
37 |
% |
|
|
37 |
% |
|
|
37 |
% |
|
|
38 |
% |
|
|
38 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA |
|||||||||||||||||||||||
|
(dollar amounts in thousands) |
Three Months Ended |
|
|
Six Months Ended |
|
|
Twelve Months Ended |
|
|||||||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||
|
Net cash provided by operating activities |
$ |
63,326 |
|
|
$ |
55,812 |
|
|
$ |
105,692 |
|
|
$ |
109,694 |
|
|
$ |
251,683 |
|
|
$ |
345,440 |
|
|
Change in certain assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Accounts receivable, net |
|
17,780 |
|
|
|
24,919 |
|
|
|
8,011 |
|
|
|
14,459 |
|
|
|
6,075 |
|
|
|
16,422 |
|
|
Inventories, prepaid expenses and other assets |
|
30,691 |
|
|
|
11,427 |
|
|
|
40,729 |
|
|
|
3,263 |
|
|
|
34,062 |
|
|
|
2,193 |
|
|
Accounts payable and accrued liabilities |
|
(39,736 |
) |
|
|
(20,522 |
) |
|
|
(18,784 |
) |
|
|
10,266 |
|
|
|
(15,147 |
) |
|
|
(137,663 |
) |
|
Deferred income |
|
(24,781 |
) |
|
|
(8,050 |
) |
|
|
(29,721 |
) |
|
|
(15,124 |
) |
|
|
(14,925 |
) |
|
|
9,664 |
|
|
Amortization of debt issuance costs |
|
(1 |
) |
|
|
(22 |
) |
|
|
(5 |
) |
|
|
(45 |
) |
|
|
(166 |
) |
|
|
(107 |
) |
|
Foreign currency exchange (loss) gain |
|
(38 |
) |
|
|
81 |
|
|
|
(71 |
) |
|
|
86 |
|
|
|
(77 |
) |
|
|
34 |
|
|
Gain on sale of used rental equipment |
|
11,103 |
|
|
|
10,281 |
|
|
|
18,035 |
|
|
|
16,674 |
|
|
|
45,552 |
|
|
|
36,222 |
|
|
Income taxes paid, net of refunds received |
|
19,505 |
|
|
|
5,762 |
|
|
|
19,780 |
|
|
|
5,786 |
|
|
|
24,110 |
|
|
|
46,909 |
|
|
Interest paid |
|
4,948 |
|
|
|
6,837 |
|
|
|
13,258 |
|
|
|
15,982 |
|
|
|
27,181 |
|
|
|
37,912 |
|
|
Adjusted EBITDA 1 |
$ |
82,797 |
|
|
$ |
86,525 |
|
|
$ |
156,924 |
|
|
$ |
161,041 |
|
|
$ |
358,348 |
|
|
$ |
357,028 |
|
|
1. |
Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, other income, net and non-operating transactions. |
|
|
2. |
Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by total revenues for the period. |
|
|
3. |
Transaction costs include acquisition related legal and professional fees and other costs specific to these transactions. |
|
|
4. |
Other income, net consists of net gains on property, plant and equipment sales that are infrequent in nature and excluded from Adjusted EBITDA. |
|
|
5. |
The gain on merger termination from WillScot Mobile Mini was considered a non-operating transaction and is excluded from Adjusted EBITDA. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20260729055837/en/
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