What was the primary driver of the significant increase in assets and revenues?

The primary driver was the acquisition of RSC Holdings, Inc. (RSC), which closed on April 30, 2012. This acquisition significantly expanded United Rentals' scale, fleet, and market presence, leading to a substantial increase in assets and revenue streams, particularly in equipment rentals.

How has the RSC acquisition impacted the company's debt levels and profitability?

The RSC acquisition led to a significant increase in long-term debt, rising from $2.59 billion to $6.72 billion, to finance the transaction. While this increased interest expense and included merger-related costs, the integrated operations and improved efficiencies contributed to higher gross profit and a substantial increase in Adjusted EBITDA, indicating a positive impact on operational profitability.

What is the outlook for capital expenditures and how is the company managing its liquidity?

United Rentals expects significant rental capital expenditures for the full year 2012, between $1.3 billion and $1.4 billion, with net rental capital expenditures projected between $925 million and $975 million. The company plans to fund these expenditures through operating cash flow, equipment sales, and existing credit facilities, including its ABL facility and accounts receivable securitization facility. As of September 30, 2012, the company had substantial borrowing capacity available under these facilities and sufficient cash to support its operations over the next 12 months.

What are the key risks highlighted in the report for investors?

The report mentions that the company is subject to various risks and uncertainties, including those detailed in its 2011 Form 10-K. Specific to this filing, investors should be aware of the significant increase in debt, the ongoing integration of the RSC acquisition, potential fluctuations in interest rates and foreign currency exchange rates, and general economic conditions affecting the equipment rental industry.

URI 10-Q Quarterly Report Q3 FY2012 — Revenue, Net Income, EPS

Summary

United Rentals, Inc. (URI) reported strong performance for the nine months ended September 30, 2012, largely driven by the significant acquisition of RSC Holdings, Inc. The company's total assets more than doubled from $4.14 billion to $10.99 billion, reflecting the integration of RSC's operations. Revenues saw a substantial increase, with equipment rentals forming the core of this growth. Despite increased debt and merger-related costs, the company demonstrated an improved operational efficiency, evidenced by higher equipment rental gross margins and a strong increase in Adjusted EBITDA. Investors should note the substantial increase in long-term debt and the ongoing integration efforts following the RSC acquisition as key areas to monitor.

Financial Highlights

49 data points

Beta

Revenue

$1.22B

0.4% Gross Margin

Net Income

$73.00M

0.1% Net Margin

EPS (Diluted)

$0.70

Total Assets

$10.99B

Cash & Equivalents

$68.00M

Free Cash Flow

$139.00M

Financial Statements

Beta

Revenue	$1.22B
Cost of Revenue	$714.00M
Gross Profit	$505.00M
SG&A Expenses	$164.00M
Operating Income	$222.00M
Net Income	$73.00M
EPS (Basic)	$0.78
EPS (Diluted)	$0.70
Shares Outstanding (Basic)	92.54M
Shares Outstanding (Diluted)	105.27M

Key Highlights

1Total assets grew significantly to $10.99 billion from $4.14 billion, largely due to the acquisition of RSC Holdings, Inc.
2Total revenues increased to $2.87 billion for the nine months ended September 30, 2012, from $1.87 billion in the prior year period.
3Equipment rentals revenue increased by 54.9% to $2.42 billion for the nine months ended September 30, 2012.
4Gross profit increased to $1.09 billion for the nine months ended September 30, 2012, from $623 million in the prior year period.
5Adjusted EBITDA showed a substantial increase to $1.22 billion for the nine months ended September 30, 2012, up from $648 million in the prior year.
6Long-term debt increased significantly to $6.72 billion from $2.59 billion, largely due to debt incurred to finance the RSC acquisition.
7The company repurchased $112 million of its common stock under a $200 million buyback program.

UNITED RENTALS, INC. Quarterly Report for Q3 Ended Sep 30, 2012

Summary

Financial Highlights

Key Highlights

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