01—Abstract
Summary
Summary of the 10-K filed January 29, 2020. Cited figures are marked; the original filing is the authoritative source.
United Rentals, Inc. (URI) reported strong performance in its 2019 annual filing, showcasing robust revenue growth driven by strategic acquisitions and organic expansion.
The company, the world's largest equipment rental provider, saw its total revenues climb to $9.35 billiona, a significant increase from $8.05 billion in the prior year, primarily fueled by its core equipment rental segment. This growth was supported by an expanding fleet, strategic acquisitions like BakerCorp and BlueLine, and a focus on operational efficiencies and customer service. The company's strategy for 2020 emphasizes continued profitability improvement, return on invested capital, superior customer service, and fleet optimization.
URI is also investing in its specialty rental segments, including trench, power, and fluid solutions, and plans further strategic acquisitions to enhance its market position. While the company anticipates industry growth of approximately 3%b in North America for 2020, it also highlights potential risks such as economic slowdowns, increasing interest rates, and competition. The company demonstrated financial strength by issuing new debt, redeeming existing debt, and amending its credit facilities, reinforcing its liquidity and financial flexibility.
02—Key points
Key Highlights
- Total revenues increased by 16.2% to $9.35 billion in 2019 from $8.05 billion in 2018.
- Equipment rental revenue grew by 14.8% year-over-year, driven by a 17.7% increase in average Original Equipment Cost (OEC) and a slight improvement in fleet productivity on a pro forma basis.
- The company completed strategic acquisitions of BakerCorp and BlueLine in 2018, which contributed to revenue growth and expanded its service offerings and geographic reach.
- United Rentals maintained a strong market position with an estimated 13% North American market share.
- The company proactively managed its debt in 2019 by issuing new notes and redeeming existing ones, while also amending and extending its ABL facility.
- Available liquidity stood at $2.143 billion as of December 31, 2019, indicating strong financial health.
- The company authorized a new $500 million share repurchase program in January 2020, signaling confidence in its financial position and commitment to returning value to shareholders.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2019, United Rentals, Inc. kept $0.13.
- Revenue$9.35B100.0%
- Cost of revenue−$5.68B60.8%
- Gross profit$3.67B39.2%
- Operating costs−$1.52B16.2%
- Operating income$2.15B23.0%
- Interest, other & tax−$978.0M10.5%
- Net income$1.17B12.6%
Where FY2019 revenue went
$9.35B- Cost of revenue: $5.68B, 61% of revenue
- Net income: $1.17B, 13% of revenue
- SG&A: $1.09B, 12% of revenue
- Other operating costs: $426.0M, 4.6% of revenue
- Interest, other & tax: $978.0M, 10% of revenue
Kept 13% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2019filed January 29, 2020Financial Statements
FY2019 against FY2018
| Line item | FY2019FY2018 | Change |
|---|---|---|
| Revenue | $9.35B$8.05B | +16.2% |
| Cost of Revenue | $5.68B$4.68B | +21.3% |
| Gross Profit | $3.67B$3.36B | +9.1% |
| SG&A Expenses | $1.09B$1.04B | +5.2% |
| Operating Income | $2.15B$1.95B | +10.3% |
| Net Income | $1.17B$1.10B | +7.1% |
| EPS (Basic) | $15.18$13.26 | +14.5% |
| EPS (Diluted) | $15.11$13.12 | +15.2% |
| Shares Outstanding (Basic) | 77.34M82.65M | −6.4% |
| Shares Outstanding (Diluted) | 77.71M83.53M | −7.0% |
05—Questions
Frequently Asked Questions
What was United Rentals' revenue performance in 2019?
United Rentals reported a 16.2% increase in total revenues for 2019, reaching $9.35 billion, up from $8.05 billion in 2018. The primary driver was the equipment rental segment, which grew by 14.8%.
How did acquisitions impact United Rentals' business in 2019?
Strategic acquisitions, particularly BakerCorp and BlueLine completed in 2018, significantly contributed to revenue growth and expanded the company's fleet, service capabilities, and customer base. These acquisitions are reflected in the increased Original Equipment Cost (OEC) and overall revenue.
What are United Rentals' key strategic priorities for 2020?
United Rentals plans to focus on improving profitability and return on invested capital, enhancing customer service through a single point of contact, optimizing its customer and fleet mix, and continuing to expand its specialty rental segments. The company also remains open to strategic acquisitions.
What is the company's financial position and liquidity outlook?
As of December 31, 2019, United Rentals had $2.143 billion in available liquidity, demonstrating a strong financial position. The company also proactively managed its debt through issuances and redemptions and amendments to its credit facilities, ensuring financial flexibility.
06—Continue