01—Abstract
Summary
Summary of the 10-K filed January 23, 2019. Cited figures are marked; the original filing is the authoritative source.
For the fiscal year ending December 31, 2018, United Rentals, Inc. (URI) demonstrated significant growth, driven by strategic acquisitions and a strong performance in its core equipment rental business.
Total revenues reached $8.05 billiona, a substantial increase from the previous year, primarily due to a 21.4% rise in equipment rental revenue. This growth was bolstered by the successful integration of acquisitions such as NES Rentals, Neff Corporation, BakerCorp, and BlueLine, which expanded the company's geographic reach and service offerings. United Rentals maintained its position as the largest equipment rental company globally, with a robust fleet and a strategic focus on customer service, operational efficiency, and profitability.
The company's strong market position, significant purchasing power, and national account program contribute to its competitive advantages. Looking ahead to 2019, the company anticipates continued solid demand in its end markets, projecting industry revenue growth of approximately 6%b, and plans to further optimize its fleet and customer mix while investing in specialty rental branches. Despite a substantial debt load, the company has taken steps to improve its financial flexibility, positioning it for continued growth and value creation.
02—Key points
Key Highlights
- Total revenues increased by 21.2% to $8.05 billion in 2018, driven by strong equipment rental revenue growth.
- The company successfully completed four significant acquisitions (NES, Neff, BakerCorp, BlueLine) in 2017 and 2018, expanding its market presence and service capabilities.
- Equipment rental revenue grew by 21.4%, with a notable 18.8% increase in the volume of equipment on rent, indicating strong customer demand.
- Rental rates saw a 2.2% year-over-year increase, contributing positively to revenue growth.
- United Rentals maintained its market leadership, with an estimated North American market share of 13.3% in 2018, up from 11.4% in 2017.
- The company generated $2.85 billion in cash from operating activities, demonstrating strong operational cash flow generation.
- Strategic focus on increasing profitability and return on invested capital through operational efficiencies and customer optimization continues.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2018, United Rentals, Inc. kept $0.14.
- Revenue$8.05B100.0%
- Cost of revenue−$4.68B58.2%
- Gross profit$3.36B41.8%
- Operating costs−$1.41B17.6%
- Operating income$1.95B24.2%
- Interest, other & tax−$855.0M10.6%
- Net income$1.10B13.6%
Where FY2018 revenue went
$8.05B- Cost of revenue: $4.68B, 58% of revenue
- Net income: $1.10B, 14% of revenue
- SG&A: $1.04B, 13% of revenue
- Other operating costs: $375.0M, 4.7% of revenue
- Interest, other & tax: $855.0M, 11% of revenue
Kept 14% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2018filed January 23, 2019Financial Statements
FY2018 against FY2017
| Line item | FY2018FY2017 | Change |
|---|---|---|
| Revenue | $8.05B$6.64B | +21.2% |
| Cost of Revenue | $4.68B$3.87B | +20.9% |
| Gross Profit | $3.36B$2.77B | +21.5% |
| SG&A Expenses | $1.04B$903.00M | +15.0% |
| Operating Income | $1.95B$1.51B | +29.5% |
| Net Income | $1.10B$1.35B | −18.6% |
| EPS (Basic) | $13.26$15.91 | −16.7% |
| EPS (Diluted) | $13.12$15.73 | −16.6% |
| Shares Outstanding (Basic) | 82.65M84.60M | −2.3% |
| Shares Outstanding (Diluted) | 83.53M85.56M | −2.4% |
05—Questions
Frequently Asked Questions
What was United Rentals' revenue performance in 2018?
In 2018, United Rentals generated total revenues of $8.05 billion, an increase of 21.2% compared to $6.64 billion in 2017. This growth was primarily driven by a 21.4% increase in equipment rental revenue, which represented 86% of total revenues.
How did the company's acquisitions impact its performance?
United Rentals completed several significant acquisitions in 2017 and 2018, including NES Rentals, Neff Corporation, BakerCorp, and BlueLine. These acquisitions significantly expanded the company's geographic footprint, fleet size, and service offerings, contributing substantially to the reported revenue growth and market share expansion.
What is the company's outlook for 2019?
United Rentals anticipates continued solid demand for its services in 2019, with projections for North American industry equipment rental revenue to increase by approximately 6%. The company plans to continue its strategy of focusing on profitability and return on invested capital by optimizing its customer and fleet mix, and expanding its specialty rental offerings.
What is the company's debt situation?
United Rentals carried a total debt of $11.75 billion as of December 31, 2018. The company has taken steps to improve its financial flexibility through various debt issuances and amendments to credit facilities. While the debt level is significant, management believes its existing liquidity sources are sufficient to support operations.
06—Continue