Summary
United Rentals, Inc. (URI) reported its financial results for the second quarter ended June 30, 2012. The most significant event during the period was the acquisition of RSC Holdings, Inc. on April 30, 2012, which substantially increased the company's assets, revenues, and debt. This acquisition positions URI as a leading North American equipment rental company, aiming for enhanced scale, an attractive business mix, and improved growth prospects through synergies and operational efficiencies. Financially, the company reported a net loss of $52 million for the quarter, or $0.63 per share, a significant change from the net income of $27 million, or $0.44 per share, in the prior year period. This loss is largely attributable to substantial merger-related costs, including interest expenses on new debt and integration charges. Despite the reported net loss, the underlying operational performance showed strength with equipment rental revenues increasing by 61.3% year-over-year, driven by both higher rental rates and increased volume, further boosted by the RSC acquisition. Management remains focused on integrating RSC and realizing cost savings and revenue opportunities to drive future profitability.
Financial Highlights
48 data points| Revenue | $993.00M |
| Cost of Revenue | $619.00M |
| Gross Profit | $374.00M |
| SG&A Expenses | $146.00M |
| Operating Income | $46.00M |
| Net Income | -$52.00M |
| EPS (Basic) | $-0.63 |
| EPS (Diluted) | $-0.63 |
| Shares Outstanding (Basic) | 83.23M |
| Shares Outstanding (Diluted) | 83.23M |
Key Highlights
- 1Completed the significant acquisition of RSC Holdings, Inc. on April 30, 2012, nearly doubling the company's asset base and expanding its market presence.
- 2Reported a net loss of $52 million for the quarter, a substantial decrease from the $27 million net income in the prior year quarter, largely due to merger-related costs and interest expenses.
- 3Equipment rental revenues increased by 61.3% to $845 million for the quarter, driven by a 63.7% increase in volume and a 7.4% rise in rental rates.
- 4Total assets grew significantly to $10.94 billion from $4.14 billion at year-end 2011, primarily due to the RSC acquisition.
- 5Total debt increased substantially to $7.29 billion from $2.99 billion, reflecting new debt issued to finance the RSC acquisition.
- 6The company incurred $80 million in RSC merger-related costs during the quarter, impacting profitability.
- 7Initiated a new restructuring program in Q2 2012 related to severance costs and branch closure charges associated with the RSC merger.