McGrath RentCorp cuts remaining-2026 outlook to $945M–$960M
The updated 2026 outlook pairs higher rental-equipment capital spending with a lower total-revenue range.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Filing Summary
McGrath RentCorp (MGRC) reported third-quarter 2026 revenue of $274.6 million, up 7% year over year, and net income of $48.8 million, or $2.00 per diluted share, versus $42.3 million and $1.72 a year earlier. Adjusted EBITDA increased 10% to $106.5 million; the company attributed higher net income and diluted EPS primarily to higher gross profit on rental operations and sales revenues.
TRS-RenTelco rental revenue rose 26% to $35.4 million and Adjusted EBITDA rose 27% to $25.7 million. Mobile Modular Adjusted EBITDA declined 3% to $62.6 million, with sales revenue down 10%; Portable Storage Adjusted EBITDA declined 20% to $7.4 million.
For the remainder of 2026, McGrath currently expects revenue of $945 million–$960 million, compared with its previous $955 million–$985 million outlook; Adjusted EBITDA of $365 million–$373 million, versus $363 million–$375 million; and gross rental equipment capital expenditures of $270 million–$290 million, up from $200 million–$220 million to support rental operations momentum at Mobile Modular and TRS-RenTelco.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointThird-quarter revenue increased 7% to $274.6 million.
- Moderate pointThird-quarter Adjusted EBITDA increased 10% to $106.5 million.
- Moderate pointNet income was $48.8 million, compared with $42.3 million in Q3 2025.
- Minor pointTRS-RenTelco third-quarter Adjusted EBITDA increased 27% to $25.7 million.
- Minor pointThird-quarter dividends declared per share rose to $0.495 from $0.485.
Negative
- Minor pointMobile Modular third-quarter sales revenue declined 10% to $47.1 million.
- Minor pointPortable Storage third-quarter Adjusted EBITDA declined 20% to $7.4 million.
Filing Explained
Nine-month rental-equipment purchases were $218,745 thousand and net bank-line borrowings $163,326 thousand; September 30 cash was $1,038 thousand.
McGrath’s Form 8-K furnishes its third-quarter results and updated 2026 outlook; it also reports nine-month common-stock repurchases and a lower issued-and-outstanding share count at quarter-end than at year-end, so the reported common-share base is smaller.
The balance sheet lists 24,364 thousand shares issued and outstanding at
On that share-count comparison, a holder keeping the same number of shares represents a larger fraction of the reported total. For the same nine-month period, the filing also reports
8-K Event Classification
Key Figures
Key Terms
Adjusted EBITDA financial
Average monthly total yield financial
Average utilization financial
Gross rental equipment capital expenditures financial
Earnings Snapshot
For the remainder of 2026, the company currently expects total revenue of $945 million to $960 million, Adjusted EBITDA of $365 million to $373 million, and gross rental equipment capital expenditures of $270 million to $290 million.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What dividend did MGRC declare for Q3 2026?
How much operating cash flow did MGRC report for the first nine months of 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): |
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On October 28, 2026, McGrath RentCorp (the “Company”) announced via press release the Company’s results for its third quarter ended September 30, 2026. A copy of the Company’s press release is attached hereto as Exhibit 99.1. This Form 8-K and the attached exhibit are provided under Item 2.02 of Form 8-K and are furnished to, but not filed with, the Securities and Exchange Commission, and shall not be incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. |
Description |
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99.1 |
Press Release of McGrath RentCorp, dated October 28, 2026. |
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Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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McGRATH RENTCORP |
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Date: |
October 28, 2026 |
By: |
/s/ Keith E. Pratt |
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Keith E. Pratt |
Exhibit 99.1
Contact
Keith E. Pratt
EVP & Chief Financial Officer
925-606-9200
PRESS RELEASE
FOR RELEASE October 28, 2026
McGrath Announces Results for Third Quarter 2026
Livermore, CA - October 28, 2026 – 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 September 30, 2026 of $274.6 million, an increase of 7% compared to the third quarter of 2025. The Company reported net income of $48.8 million, or $2.00 per diluted share, for the third quarter of 2026, compared to net income of $42.3 million, or $1.72 per diluted share, for the third quarter of 2025. The increases in net income and earnings per diluted share for the quarter were primarily attributed to higher gross profit on rental operations and sales revenues when compared to the third quarter of 2025.
THIRD QUARTER 2026 YEAR-OVER-YEAR Company HIGHLIGHTS:
Phil Hawkins, President and CEO of McGrath, made the following comments:
“We were pleased with our third quarter results. The 7% increase in companywide revenues was primarily driven by higher rental operations, reflecting steady progress at Mobile Modular and TRS-RenTelco.
Modular rental revenues increased 4% compared to last year, with continued growth from our commercial customer base. Consistent with the first half of this year, we experienced positive business momentum during the quarter, particularly with large commercial projects and progress with our regional expansion efforts. We responded to this momentum with additional capital investments in new rental fleet.
Portable Storage rental revenues decreased 3% as market demand conditions remained soft. Consistent with the first half of this year, higher costs for equipment preparation, trucking and sales coverage continued to pressure margins in the quarter.
TRS had another impressive quarter with rental revenues increasing 26%. Demand remained robust throughout the quarter, and the business continued to benefit from projects supporting buildout of new data centers. We made additional investments in rental fleet to support the strong market conditions and positive outlook for the business.
Our updated outlook for the year reflects continued positive rental operations momentum and investment at Mobile Modular and TRS, partly offset by lower Modular new equipment sales. We are focused on disciplined operational execution and capitalizing on our rental operations momentum through the remainder of the year.”
Division HIGHLIGHTS:
All comparisons presented below are for the quarter ended September 30, 2026 to the quarter ended September 30, 2025 unless otherwise indicated.
Mobile Modular
For the third quarter of 2026, the Company’s Mobile Modular division reported Adjusted EBITDA of $62.6 million, a decrease of $1.9 million, or 3%, when compared to the same quarter in 2025.
Portable storage
For the third quarter of 2026, the Company’s Portable Storage division reported Adjusted EBITDA of $7.4 million, a decrease of $1.9 million, or 20%, when compared to the same quarter in 2025.
TRS-RenTelco
For the third quarter of 2026, the Company’s TRS-RenTelco division reported Adjusted EBITDA of $25.7 million, an increase of 27% when compared to the same quarter in 2025.
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. Total revenues is decreasing as a result of lower Mobile Modular new equipment sales. Adjusted EBITDA range has narrowed with no change to mid-point expectations. Gross rental equipment capital expenditures are increasing to support rental operations momentum at Mobile Modular and TRS-RenTelco. For the remainder of 2026, the Company currently expects:
2
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Previous |
Current |
• |
Total revenue: |
$955 to $985 million |
$945 to $960 million |
• |
Adjusted EBITDA1, 2: |
$363 to $375 million |
$365 to $373 million |
• |
Gross rental equipment capital expenditures: |
$200 to $220 million |
$270 to $290 million |
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 over 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 web site 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 October 1, 2026, McGrath RentCorp will host a conference call at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) on October 28, 2026 to discuss the third 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 1-800-723-5759 (in the U.S.), or 1-402-220-2662 (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 the Company's updated outlook for the year reflecting continued positive rental operations momentum at Mobile Modular and TRS, partly offset by lower Modular new equipment sales, 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: the continued impact of tariff actions and macroeconomic factors, including fiscal policy uncertainty, government budgetary constraints, other political, geopolitical or regulatory developments; fuel costs; 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
3
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.
4
MCGRATH RENTCORP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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(in thousands, except per share amounts) |
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2026 |
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2025 |
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2026 |
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2025 |
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Revenues |
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Rental |
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$ |
139,057 |
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$ |
128,488 |
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$ |
397,598 |
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$ |
374,586 |
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Rental related services |
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50,418 |
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49,622 |
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126,608 |
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121,021 |
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Rental operations |
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189,475 |
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178,110 |
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524,206 |
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495,607 |
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Sales |
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82,898 |
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76,058 |
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163,288 |
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184,759 |
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Other |
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2,233 |
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2,275 |
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6,766 |
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7,109 |
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Total revenues |
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274,606 |
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256,443 |
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694,260 |
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687,475 |
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Costs and Expenses |
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Direct costs of rental operations: |
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Depreciation of rental equipment |
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24,534 |
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21,868 |
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70,477 |
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64,799 |
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Rental related services |
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36,229 |
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35,422 |
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89,722 |
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85,212 |
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Other |
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34,931 |
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32,308 |
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101,537 |
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91,479 |
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Total direct costs of rental operations |
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95,694 |
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89,598 |
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261,736 |
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241,490 |
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Costs of sales |
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48,038 |
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47,588 |
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96,853 |
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119,578 |
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Total costs of revenues |
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143,732 |
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137,186 |
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358,589 |
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361,068 |
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Gross profit |
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130,874 |
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119,257 |
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335,671 |
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326,407 |
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Expenses: |
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Selling and administrative expenses |
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56,935 |
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52,540 |
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166,859 |
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156,952 |
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Other income, net |
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— |
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— |
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(1,814 |
) |
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— |
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Income from operations |
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73,939 |
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66,717 |
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170,626 |
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169,455 |
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Interest expense |
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7,965 |
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8,177 |
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21,578 |
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24,130 |
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Foreign currency exchange loss (gain) |
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6 |
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32 |
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77 |
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(54 |
) |
Income before provision for income taxes |
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65,968 |
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58,508 |
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148,971 |
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145,379 |
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Provision for income taxes |
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17,165 |
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16,211 |
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39,463 |
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38,900 |
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Net income |
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48,803 |
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42,297 |
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109,508 |
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106,479 |
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Earnings per share: |
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Basic |
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$ |
2.00 |
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$ |
1.72 |
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$ |
4.47 |
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$ |
4.33 |
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Diluted |
|
$ |
2.00 |
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$ |
1.72 |
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$ |
4.46 |
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$ |
4.32 |
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Shares used in per share calculation: |
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Basic |
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24,413 |
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24,612 |
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24,502 |
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|
24,598 |
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Diluted |
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24,451 |
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|
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24,644 |
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|
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24,536 |
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|
|
24,628 |
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Cash dividends declared per share |
|
$ |
0.495 |
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$ |
0.485 |
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$ |
1.485 |
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$ |
1.455 |
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5
MCGRATH RENTCORP
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
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September 30, |
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December 31, |
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(in thousands) |
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2026 |
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2025 |
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Assets |
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Cash |
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$ |
1,038 |
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$ |
295 |
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Accounts receivable, net of allowance for credit losses of $2,400 at September 30, 2026 and $2,866 at December 31, 2025 |
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244,850 |
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231,865 |
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Rental equipment, at cost: |
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Relocatable modular buildings |
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1,607,898 |
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1,485,794 |
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Portable storage containers |
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245,917 |
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245,141 |
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Electronic test equipment |
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389,141 |
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337,100 |
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2,242,956 |
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2,068,035 |
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Less: accumulated depreciation |
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(685,814 |
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(647,137 |
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Rental equipment, net |
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1,557,142 |
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1,420,898 |
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Property, plant and equipment, net |
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263,680 |
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233,492 |
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Inventories |
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9,589 |
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8,027 |
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Prepaid expenses and other assets |
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123,036 |
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83,351 |
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Intangible assets, net |
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39,120 |
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46,605 |
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Goodwill |
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337,362 |
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332,584 |
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Total assets |
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$ |
2,575,817 |
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$ |
2,357,117 |
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Liabilities and Shareholders' Equity |
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Liabilities: |
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Notes payable |
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$ |
618,257 |
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$ |
514,924 |
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Accounts payable |
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|
69,232 |
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66,233 |
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Accrued liabilities |
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|
133,903 |
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|
|
114,764 |
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Deferred income |
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|
145,148 |
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|
|
110,593 |
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Deferred income taxes, net |
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|
331,170 |
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|
313,580 |
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Total liabilities |
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|
1,297,710 |
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|
|
1,120,094 |
|
Shareholders’ equity: |
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|
|
|
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Common stock, no par value - Authorized 40,000 shares |
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Issued and outstanding - 24,364 shares as of September 30, 2026 and 24,612 shares as of December 31, 2025 |
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|
122,626 |
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|
121,785 |
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Retained earnings |
|
|
1,155,481 |
|
|
|
1,115,238 |
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Total shareholders’ equity |
|
|
1,278,107 |
|
|
|
1,237,023 |
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Total liabilities and shareholders’ equity |
|
$ |
2,575,817 |
|
|
$ |
2,357,117 |
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6
MCGRATH RENTCORP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
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Nine Months Ended September 30, |
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(in thousands) |
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2026 |
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2025 |
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Cash Flows from Operating Activities: |
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|
|
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Net income |
|
$ |
109,508 |
|
|
$ |
106,479 |
|
Adjustments to reconcile net income to net cash provided by |
|
|
|
|
|
|
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Depreciation and amortization |
|
|
85,973 |
|
|
|
79,717 |
|
Deferred income taxes |
|
|
15,645 |
|
|
|
22,918 |
|
Provision for credit losses |
|
|
853 |
|
|
|
1,266 |
|
Share-based compensation |
|
|
8,451 |
|
|
|
8,088 |
|
Gain on sale of property, plant and equipment |
|
|
(1,814 |
) |
|
|
— |
|
Gain on sale of used rental equipment |
|
|
(32,749 |
) |
|
|
(30,188 |
) |
Foreign currency exchange loss (gain) |
|
|
77 |
|
|
|
(54 |
) |
Amortization of debt issuance costs |
|
|
6 |
|
|
|
204 |
|
Change in: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
(13,692 |
) |
|
|
(23,270 |
) |
Inventories |
|
|
(1,562 |
) |
|
|
882 |
|
Prepaid expenses and other assets |
|
|
(39,614 |
) |
|
|
(1,884 |
) |
Accounts payable |
|
|
(5,348 |
) |
|
|
(8,041 |
) |
Accrued liabilities |
|
|
17,682 |
|
|
|
(1,854 |
) |
Deferred income |
|
|
34,555 |
|
|
|
20,502 |
|
Net cash provided by operating activities |
|
|
177,971 |
|
|
|
174,765 |
|
Cash Flows from Investing Activities: |
|
|
|
|
|
|
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Purchases of rental equipment |
|
|
(218,745 |
) |
|
|
(91,516 |
) |
Purchases of property, plant and equipment |
|
|
(37,969 |
) |
|
|
(33,235 |
) |
Cash paid for acquisition of businesses, net of cash received |
|
|
(9,538 |
) |
|
|
(21,947 |
) |
Proceeds from sales of used rental equipment |
|
|
59,969 |
|
|
|
58,647 |
|
Proceeds from sales of property, plant and equipment |
|
|
2,750 |
|
|
|
— |
|
Net cash used in investing activities |
|
|
(203,533 |
) |
|
|
(88,051 |
) |
Cash Flows from Financing Activities: |
|
|
|
|
|
|
||
Net borrowings (payments) under bank lines of credit |
|
|
163,326 |
|
|
|
(40,612 |
) |
Principal payment of term note agreement |
|
|
— |
|
|
|
(73,000 |
) |
Borrowings under Series G senior notes |
|
|
— |
|
|
|
75,000 |
|
Principal payment of Series E senior notes |
|
|
(60,000 |
) |
|
|
— |
|
Repurchase of common stock |
|
|
(34,223 |
) |
|
|
— |
|
Taxes paid related to net share settlement of stock awards |
|
|
(6,032 |
) |
|
|
(5,693 |
) |
Payment of dividends |
|
|
(36,766 |
) |
|
|
(35,960 |
) |
Net cash provided by (used in) financing activities |
|
|
26,305 |
|
|
|
(80,265 |
) |
Net increase in cash |
|
|
743 |
|
|
|
6,449 |
|
Cash balance, beginning of period |
|
|
295 |
|
|
|
807 |
|
Cash balance, end of period |
|
$ |
1,038 |
|
|
$ |
7,256 |
|
Supplemental Disclosure of Cash Flow Information: |
|
|
|
|
|
|
||
Interest paid, during the period |
|
$ |
23,419 |
|
|
$ |
24,869 |
|
Net income taxes paid, during the period |
|
$ |
27,895 |
|
|
$ |
6,537 |
|
Dividends accrued during the period, not yet paid |
|
$ |
12,617 |
|
|
$ |
12,535 |
|
Rental equipment acquisitions, not yet paid |
|
$ |
19,889 |
|
|
$ |
8,459 |
|
Business acquisition payments withheld |
|
$ |
1,110 |
|
|
$ |
1,815 |
|
|
|
|
|
|
|
|
||
7
MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Three months ended September 30, 2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
(dollar amounts in thousands) |
|
Mobile Modular |
|
|
Portable Storage |
|
|
TRS-RenTelco |
|
|
Enviroplex |
|
|
Consolidated |
|
|||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
$ |
86,901 |
|
|
$ |
16,769 |
|
|
$ |
35,387 |
|
|
$ |
— |
|
|
$ |
139,057 |
|
Rental related services |
|
|
44,648 |
|
|
|
4,416 |
|
|
|
1,354 |
|
|
|
— |
|
|
|
50,418 |
|
Rental operations |
|
|
131,549 |
|
|
|
21,185 |
|
|
|
36,741 |
|
|
|
— |
|
|
|
189,475 |
|
Sales |
|
|
47,053 |
|
|
|
2,267 |
|
|
|
7,879 |
|
|
|
25,699 |
|
|
|
82,898 |
|
Other |
|
|
1,323 |
|
|
|
218 |
|
|
|
692 |
|
|
|
— |
|
|
|
2,233 |
|
Total revenues |
|
|
179,925 |
|
|
|
23,670 |
|
|
|
45,312 |
|
|
|
25,699 |
|
|
|
274,606 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation |
|
|
11,962 |
|
|
|
1,104 |
|
|
|
11,468 |
|
|
|
— |
|
|
|
24,534 |
|
Rental related services |
|
|
28,923 |
|
|
|
5,524 |
|
|
|
1,782 |
|
|
|
— |
|
|
|
36,229 |
|
Other |
|
|
25,945 |
|
|
|
2,222 |
|
|
|
6,764 |
|
|
|
— |
|
|
|
34,931 |
|
Total direct costs of rental operations |
|
|
66,830 |
|
|
|
8,850 |
|
|
|
20,014 |
|
|
|
— |
|
|
|
95,694 |
|
Costs of sales |
|
|
30,210 |
|
|
|
1,425 |
|
|
|
3,428 |
|
|
|
12,975 |
|
|
|
48,038 |
|
Total costs of revenues |
|
|
97,040 |
|
|
|
10,275 |
|
|
|
23,442 |
|
|
|
12,975 |
|
|
|
143,732 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gross Profit (Loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
|
48,994 |
|
|
|
13,443 |
|
|
|
17,155 |
|
|
|
— |
|
|
|
79,592 |
|
Rental related services |
|
|
15,725 |
|
|
|
(1,108 |
) |
|
|
(428 |
) |
|
|
— |
|
|
|
14,189 |
|
Rental operations |
|
|
64,719 |
|
|
|
12,335 |
|
|
|
16,727 |
|
|
|
— |
|
|
|
93,781 |
|
Sales |
|
|
16,843 |
|
|
|
842 |
|
|
|
4,451 |
|
|
|
12,724 |
|
|
|
34,860 |
|
Other |
|
|
1,323 |
|
|
|
218 |
|
|
|
692 |
|
|
|
— |
|
|
|
2,233 |
|
Total gross profit |
|
|
82,885 |
|
|
|
13,395 |
|
|
|
21,870 |
|
|
|
12,724 |
|
|
|
130,874 |
|
Selling and administrative expenses |
|
|
38,320 |
|
|
|
8,328 |
|
|
|
8,194 |
|
|
|
2,093 |
|
|
|
56,935 |
|
Income from operations |
|
$ |
44,565 |
|
|
$ |
5,067 |
|
|
$ |
13,676 |
|
|
$ |
10,631 |
|
|
|
73,939 |
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(7,965 |
) |
||||
Foreign currency exchange loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6 |
) |
||||
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(17,165 |
) |
||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
48,803 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Other Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Adjusted EBITDA 1 |
|
$ |
62,637 |
|
|
$ |
7,375 |
|
|
$ |
25,739 |
|
|
$ |
10,736 |
|
|
$ |
106,487 |
|
Average rental equipment 2 |
|
$ |
1,458,867 |
|
|
$ |
242,827 |
|
|
$ |
366,209 |
|
|
|
|
|
|
|
||
Average monthly total yield 3 |
|
|
1.99 |
% |
|
|
2.30 |
% |
|
|
3.22 |
% |
|
|
|
|
|
|
||
Average utilization 4 |
|
|
70.2 |
% |
|
|
59.1 |
% |
|
|
69.9 |
% |
|
|
|
|
|
|
||
Average monthly rental rate 5 |
|
|
2.83 |
% |
|
|
3.89 |
% |
|
|
4.61 |
% |
|
|
|
|
|
|
||
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.
8
MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Three months ended September 30, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
(dollar amounts in thousands) |
|
Mobile Modular |
|
|
Portable Storage |
|
|
TRS-RenTelco |
|
|
Enviroplex |
|
|
Consolidated |
|
|||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
$ |
83,168 |
|
|
$ |
17,293 |
|
|
$ |
28,027 |
|
|
$ |
— |
|
|
$ |
128,488 |
|
Rental related services |
|
|
44,544 |
|
|
|
4,187 |
|
|
|
891 |
|
|
|
— |
|
|
|
49,622 |
|
Rental operations |
|
|
127,712 |
|
|
|
21,480 |
|
|
|
28,918 |
|
|
|
— |
|
|
|
178,110 |
|
Sales |
|
|
52,334 |
|
|
|
2,693 |
|
|
|
7,347 |
|
|
|
13,684 |
|
|
|
76,058 |
|
Other |
|
|
1,422 |
|
|
|
229 |
|
|
|
624 |
|
|
|
— |
|
|
|
2,275 |
|
Total revenues |
|
|
181,468 |
|
|
|
24,402 |
|
|
|
36,889 |
|
|
|
13,684 |
|
|
|
256,443 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation |
|
|
10,810 |
|
|
|
1,056 |
|
|
|
10,002 |
|
|
|
— |
|
|
|
21,868 |
|
Rental related services |
|
|
29,809 |
|
|
|
4,739 |
|
|
|
874 |
|
|
|
— |
|
|
|
35,422 |
|
Other |
|
|
24,199 |
|
|
|
2,191 |
|
|
|
5,918 |
|
|
|
— |
|
|
|
32,308 |
|
Total direct costs of rental operations |
|
|
64,818 |
|
|
|
7,986 |
|
|
|
16,794 |
|
|
|
— |
|
|
|
89,598 |
|
Costs of sales |
|
|
33,558 |
|
|
|
1,629 |
|
|
|
3,231 |
|
|
|
9,170 |
|
|
|
47,588 |
|
Total costs of revenues |
|
|
98,376 |
|
|
|
9,615 |
|
|
|
20,025 |
|
|
|
9,170 |
|
|
|
137,186 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gross Profit (Loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
|
48,159 |
|
|
|
14,046 |
|
|
|
12,107 |
|
|
|
— |
|
|
|
74,312 |
|
Rental related services |
|
|
14,735 |
|
|
|
(552 |
) |
|
|
17 |
|
|
|
— |
|
|
|
14,200 |
|
Rental operations |
|
|
62,894 |
|
|
|
13,494 |
|
|
|
12,124 |
|
|
|
— |
|
|
|
88,512 |
|
Sales |
|
|
18,776 |
|
|
|
1,064 |
|
|
|
4,116 |
|
|
|
4,514 |
|
|
|
28,470 |
|
Other |
|
|
1,422 |
|
|
|
229 |
|
|
|
624 |
|
|
|
— |
|
|
|
2,275 |
|
Total gross profit |
|
|
83,092 |
|
|
|
14,787 |
|
|
|
16,864 |
|
|
|
4,514 |
|
|
|
119,257 |
|
Selling and administrative expenses |
|
|
35,389 |
|
|
|
7,912 |
|
|
|
7,113 |
|
|
|
2,126 |
|
|
|
52,540 |
|
Income from operations |
|
$ |
47,703 |
|
|
$ |
6,875 |
|
|
$ |
9,751 |
|
|
$ |
2,388 |
|
|
|
66,717 |
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(8,177 |
) |
||||
Foreign currency exchange loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(32 |
) |
||||
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(16,211 |
) |
||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
42,297 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Other Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Adjusted EBITDA 1 |
|
$ |
64,573 |
|
|
$ |
9,245 |
|
|
$ |
20,212 |
|
|
$ |
2,496 |
|
|
$ |
96,526 |
|
Average rental equipment 2 |
|
$ |
1,328,245 |
|
|
$ |
237,227 |
|
|
$ |
333,045 |
|
|
|
|
|
|
|
||
Average monthly total yield 3 |
|
|
2.09 |
% |
|
|
2.43 |
% |
|
|
2.81 |
% |
|
|
|
|
|
|
||
Average utilization 4 |
|
|
72.6 |
% |
|
|
61.4 |
% |
|
|
64.8 |
% |
|
|
|
|
|
|
||
Average monthly rental rate 5 |
|
|
2.88 |
% |
|
|
3.96 |
% |
|
|
4.33 |
% |
|
|
|
|
|
|
||
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.
9
MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Nine months ended September 30, 2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
(dollar amounts in thousands) |
|
Mobile Modular |
|
|
Portable Storage |
|
|
TRS-RenTelco |
|
|
Enviroplex |
|
|
Consolidated |
|
|||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
$ |
251,518 |
|
|
$ |
49,909 |
|
|
$ |
96,171 |
|
|
$ |
— |
|
|
$ |
397,598 |
|
Rental related services |
|
|
110,202 |
|
|
|
12,799 |
|
|
|
3,607 |
|
|
|
— |
|
|
|
126,608 |
|
Rental operations |
|
|
361,720 |
|
|
|
62,708 |
|
|
|
99,778 |
|
|
|
— |
|
|
|
524,206 |
|
Sales |
|
|
99,127 |
|
|
|
5,724 |
|
|
|
24,618 |
|
|
|
33,819 |
|
|
|
163,288 |
|
Other |
|
|
3,905 |
|
|
|
686 |
|
|
|
2,175 |
|
|
|
— |
|
|
|
6,766 |
|
Total revenues |
|
|
464,752 |
|
|
|
69,118 |
|
|
|
126,571 |
|
|
|
33,819 |
|
|
|
694,260 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation |
|
|
35,329 |
|
|
|
3,300 |
|
|
|
31,848 |
|
|
|
— |
|
|
|
70,477 |
|
Rental related services |
|
|
70,792 |
|
|
|
15,469 |
|
|
|
3,461 |
|
|
|
— |
|
|
|
89,722 |
|
Other |
|
|
75,968 |
|
|
|
6,595 |
|
|
|
18,974 |
|
|
|
— |
|
|
|
101,537 |
|
Total direct costs of rental operations |
|
|
182,089 |
|
|
|
25,364 |
|
|
|
54,283 |
|
|
|
— |
|
|
|
261,736 |
|
Costs of sales |
|
|
64,596 |
|
|
|
3,575 |
|
|
|
9,990 |
|
|
|
18,692 |
|
|
|
96,853 |
|
Total costs of revenues |
|
|
246,685 |
|
|
|
28,939 |
|
|
|
64,273 |
|
|
|
18,692 |
|
|
|
358,589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gross Profit (Loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
|
140,221 |
|
|
|
40,014 |
|
|
|
45,349 |
|
|
|
— |
|
|
|
225,584 |
|
Rental related services |
|
|
39,410 |
|
|
|
(2,670 |
) |
|
|
146 |
|
|
|
— |
|
|
|
36,886 |
|
Rental operations |
|
|
179,631 |
|
|
|
37,344 |
|
|
|
45,495 |
|
|
|
— |
|
|
|
262,470 |
|
Sales |
|
|
34,531 |
|
|
|
2,149 |
|
|
|
14,628 |
|
|
|
15,127 |
|
|
|
66,435 |
|
Other |
|
|
3,905 |
|
|
|
686 |
|
|
|
2,175 |
|
|
|
— |
|
|
|
6,766 |
|
Total gross profit |
|
|
218,067 |
|
|
|
40,179 |
|
|
|
62,298 |
|
|
|
15,127 |
|
|
|
335,671 |
|
Selling and administrative expenses |
|
|
110,932 |
|
|
|
25,190 |
|
|
|
24,447 |
|
|
|
6,290 |
|
|
|
166,859 |
|
Income from operations |
|
$ |
107,135 |
|
|
$ |
14,989 |
|
|
$ |
37,851 |
|
|
$ |
8,837 |
|
|
|
168,812 |
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(21,578 |
) |
||||
Foreign currency exchange loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(77 |
) |
||||
Other income, net 6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,814 |
|
||||
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(39,463 |
) |
||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
109,508 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Other Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Adjusted EBITDA 1 |
|
$ |
160,567 |
|
|
$ |
22,101 |
|
|
$ |
71,583 |
|
|
$ |
9,160 |
|
|
$ |
263,411 |
|
Average rental equipment 2 |
|
$ |
1,422,229 |
|
|
$ |
242,832 |
|
|
$ |
349,022 |
|
|
|
|
|
|
|
||
Average monthly total yield 3 |
|
|
1.96 |
% |
|
|
2.28 |
% |
|
|
3.06 |
% |
|
|
|
|
|
|
||
Average utilization 4 |
|
|
70.1 |
% |
|
|
58.7 |
% |
|
|
68.0 |
% |
|
|
|
|
|
|
||
Average monthly rental rate 5 |
|
|
2.80 |
% |
|
|
3.89 |
% |
|
|
4.50 |
% |
|
|
|
|
|
|
||
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 nine months ended September 30, 2026, the Company sold a corporate property which resulted in a net gain on sale of $1,814, excluding taxes.
10
MCGRATH RENTCORP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
BUSINESS SEGMENT DATA (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Nine months ended September 30, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
(dollar amounts in thousands) |
|
Mobile Modular |
|
|
Portable Storage |
|
|
TRS-RenTelco |
|
|
Enviroplex |
|
|
Consolidated |
|
|||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
$ |
243,572 |
|
|
$ |
50,307 |
|
|
$ |
80,707 |
|
|
$ |
— |
|
|
$ |
374,586 |
|
Rental related services |
|
|
106,191 |
|
|
|
12,212 |
|
|
|
2,618 |
|
|
|
— |
|
|
|
121,021 |
|
Rental operations |
|
|
349,763 |
|
|
|
62,519 |
|
|
|
83,325 |
|
|
|
— |
|
|
|
495,607 |
|
Sales |
|
|
115,308 |
|
|
|
5,649 |
|
|
|
23,039 |
|
|
|
40,763 |
|
|
|
184,759 |
|
Other |
|
|
4,303 |
|
|
|
846 |
|
|
|
1,960 |
|
|
|
— |
|
|
|
7,109 |
|
Total revenues |
|
|
469,374 |
|
|
|
69,014 |
|
|
|
108,324 |
|
|
|
40,763 |
|
|
|
687,475 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct costs of rental operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation |
|
|
32,105 |
|
|
|
3,125 |
|
|
|
29,569 |
|
|
|
— |
|
|
|
64,799 |
|
Rental related services |
|
|
69,999 |
|
|
|
12,976 |
|
|
|
2,237 |
|
|
|
— |
|
|
|
85,212 |
|
Other |
|
|
69,001 |
|
|
|
5,636 |
|
|
|
16,842 |
|
|
|
— |
|
|
|
91,479 |
|
Total direct costs of rental operations |
|
|
171,105 |
|
|
|
21,737 |
|
|
|
48,648 |
|
|
|
— |
|
|
|
241,490 |
|
Costs of sales |
|
|
76,483 |
|
|
|
3,509 |
|
|
|
11,574 |
|
|
|
28,012 |
|
|
|
119,578 |
|
Total costs of revenues |
|
|
247,588 |
|
|
|
25,246 |
|
|
|
60,222 |
|
|
|
28,012 |
|
|
|
361,068 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gross Profit (Loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rental |
|
|
142,466 |
|
|
|
41,546 |
|
|
|
34,296 |
|
|
|
— |
|
|
|
218,308 |
|
Rental related services |
|
|
36,192 |
|
|
|
(764 |
) |
|
|
381 |
|
|
|
— |
|
|
|
35,809 |
|
Rental operations |
|
|
178,658 |
|
|
|
40,782 |
|
|
|
34,677 |
|
|
|
— |
|
|
|
254,117 |
|
Sales |
|
|
38,825 |
|
|
|
2,140 |
|
|
|
11,465 |
|
|
|
12,751 |
|
|
|
65,181 |
|
Other |
|
|
4,303 |
|
|
|
846 |
|
|
|
1,960 |
|
|
|
— |
|
|
|
7,109 |
|
Total gross profit |
|
|
221,786 |
|
|
|
43,768 |
|
|
|
48,102 |
|
|
|
12,751 |
|
|
|
326,407 |
|
Selling and administrative expenses |
|
|
106,154 |
|
|
|
23,014 |
|
|
|
21,871 |
|
|
|
5,913 |
|
|
|
156,952 |
|
Income from operations |
|
$ |
115,632 |
|
|
$ |
20,754 |
|
|
$ |
26,231 |
|
|
$ |
6,838 |
|
|
|
169,455 |
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(24,130 |
) |
||||
Foreign currency exchange gain |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
54 |
|
||||
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(38,900 |
) |
||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
106,479 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Other Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Adjusted EBITDA 1 |
|
$ |
165,290 |
|
|
$ |
27,666 |
|
|
$ |
57,463 |
|
|
$ |
7,148 |
|
|
$ |
257,567 |
|
Average rental equipment 2 |
|
$ |
1,304,716 |
|
|
$ |
234,957 |
|
|
$ |
334,389 |
|
|
|
|
|
|
|
||
Average monthly total yield 3 |
|
|
2.07 |
% |
|
|
2.38 |
% |
|
|
2.68 |
% |
|
|
|
|
|
|
||
Average utilization 4 |
|
|
73.6 |
% |
|
|
60.8 |
% |
|
|
63.5 |
% |
|
|
|
|
|
|
||
Average monthly rental rate 5 |
|
|
2.82 |
% |
|
|
3.91 |
% |
|
|
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.
11
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 |
|
|
Nine Months Ended |
|
|
Twelve Months Ended |
|
|||||||||||||||
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||
Net income |
$ |
48,803 |
|
|
$ |
42,297 |
|
|
$ |
109,508 |
|
|
$ |
106,479 |
|
|
$ |
159,336 |
|
|
$ |
145,428 |
|
Provision for income taxes |
|
17,165 |
|
|
|
16,211 |
|
|
|
39,463 |
|
|
|
38,900 |
|
|
|
57,336 |
|
|
|
51,909 |
|
Interest expense |
|
7,965 |
|
|
|
8,176 |
|
|
|
21,578 |
|
|
|
24,130 |
|
|
|
28,070 |
|
|
|
32,988 |
|
Depreciation and amortization |
|
29,693 |
|
|
|
26,978 |
|
|
|
85,973 |
|
|
|
79,717 |
|
|
|
113,325 |
|
|
|
106,348 |
|
EBITDA |
|
103,627 |
|
|
|
93,662 |
|
|
|
256,522 |
|
|
|
249,226 |
|
|
|
358,068 |
|
|
|
336,673 |
|
Share-based compensation |
|
2,772 |
|
|
|
2,766 |
|
|
|
8,451 |
|
|
|
8,088 |
|
|
|
11,588 |
|
|
|
10,641 |
|
Transaction costs 3 |
|
88 |
|
|
|
98 |
|
|
|
252 |
|
|
|
253 |
|
|
|
465 |
|
|
|
2,255 |
|
Other income, net 4 |
|
— |
|
|
|
— |
|
|
|
(1,814 |
) |
|
|
— |
|
|
|
(1,814 |
) |
|
|
— |
|
Adjusted EBITDA 1 |
$ |
106,487 |
|
|
$ |
96,526 |
|
|
$ |
263,411 |
|
|
$ |
257,567 |
|
|
$ |
368,307 |
|
|
$ |
349,569 |
|
Adjusted EBITDA margin 2 |
|
39 |
% |
|
|
38 |
% |
|
|
38 |
% |
|
|
37 |
% |
|
|
39 |
% |
|
|
38 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
12
Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA
(dollar amounts in thousands) |
Three Months Ended |
|
|
Nine Months Ended |
|
|
Twelve Months Ended |
|
|||||||||||||||
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||
Net cash provided by operating activities |
$ |
72,279 |
|
|
$ |
65,071 |
|
|
$ |
177,971 |
|
|
$ |
174,765 |
|
|
$ |
258,889 |
|
|
$ |
211,544 |
|
Change in certain assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounts receivable, net |
|
4,828 |
|
|
|
7,545 |
|
|
|
12,839 |
|
|
|
22,004 |
|
|
|
3,358 |
|
|
|
16,817 |
|
Inventories, prepaid expenses and other assets |
|
447 |
|
|
|
(2,261 |
) |
|
|
41,176 |
|
|
|
1,002 |
|
|
|
36,770 |
|
|
|
14,103 |
|
Accounts payable and accrued liabilities |
|
784 |
|
|
|
8,588 |
|
|
|
(18,000 |
) |
|
|
18,854 |
|
|
|
(22,951 |
) |
|
|
(5,834 |
) |
Deferred income |
|
(4,834 |
) |
|
|
(5,378 |
) |
|
|
(34,555 |
) |
|
|
(20,502 |
) |
|
|
(14,381 |
) |
|
|
(6,413 |
) |
Amortization of debt issuance costs |
|
(1 |
) |
|
|
(159 |
) |
|
|
(6 |
) |
|
|
(204 |
) |
|
|
(8 |
) |
|
|
(264 |
) |
Foreign currency exchange (loss) gain |
|
(6 |
) |
|
|
(32 |
) |
|
|
(77 |
) |
|
|
54 |
|
|
|
(51 |
) |
|
|
(214 |
) |
Gain on sale of used rental equipment |
|
14,714 |
|
|
|
13,514 |
|
|
|
32,749 |
|
|
|
30,188 |
|
|
|
46,752 |
|
|
|
40,088 |
|
Income taxes paid, net of refunds received |
|
8,115 |
|
|
|
751 |
|
|
|
27,895 |
|
|
|
6,537 |
|
|
|
31,474 |
|
|
|
46,887 |
|
Interest paid |
|
10,161 |
|
|
|
8,887 |
|
|
|
23,419 |
|
|
|
24,869 |
|
|
|
28,455 |
|
|
|
32,855 |
|
Adjusted EBITDA 1 |
$ |
106,487 |
|
|
$ |
96,526 |
|
|
$ |
263,411 |
|
|
$ |
257,567 |
|
|
$ |
368,307 |
|
|
$ |
349,569 |
|
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.
13