McGrath Announces Results for Second Quarter 2026

Key Terms

adjusted ebitda financial

Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.

gross margin financial

Gross margin is the difference between how much money a company makes from selling its products and how much it costs to produce them, expressed as a percentage of sales. It shows how efficiently a company is turning sales into profit before other expenses like marketing or salaries. Higher gross margin means the company keeps more money from each sale, which is a good sign of financial health.

capital expenditures financial

Capital expenditures are the money a company spends to buy or improve big assets like buildings, equipment, or machines that will last a long time. These investments matter because they help the company grow and operate more efficiently, similar to how upgrading a home’s appliances or adding a new room can make it better and more valuable.

share-based compensation financial

Share-based compensation is when a company pays employees, executives or directors with its own stock or rights to buy stock instead of, or in addition to, cash. Think of it like receiving store gift cards instead of extra paycheck — it can motivate staff to boost the company’s value, but it also increases the number of shares outstanding and can shrink each existing owner’s slice of profits and voting power. Investors watch it because it affects reported earnings, share count and the alignment between management and shareholders.

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LIVERMORE, Calif.--(BUSINESS WIRE)-- 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 operating activities:
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 June 30,								Six Months Ended June 30,								Twelve Months Ended June 30,
	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 June 30,								Six Months Ended June 30,								Twelve Months Ended June 30,
	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/

Keith E. Pratt
EVP & Chief Financial Officer
925-606-9200

Source: McGrath RentCorp