United Rentals posted total revenue of $1.544 billion, compared with $1.311 billion for the same period in 2013, a 17.8 increase, while rental revenue jumped 15.5 percent from $1.138 billion last year to $1.315 billion. Net income was $192 million, compared with $143 billion a year ago. Adjusted EBITDA was $761 million, and adjusted EBITDA margin was a company record 49.3 percent for the quarter.
The company reaffirmed its outlook for a full-year increase in rental rates of approximately 4.5 percent, and full year total revenue in a range of $5.55 billion to $5.65 billion. The company expects full year adjusted EBITDA in a range of $2.65 billion to $2.70 billion.
Return on invested capital was 8.4 percent for the 12 months ended Sept. 30, 2014, an increase of 1.3 percentage points from the 12 months ended Sept. 30, 2013. Time utilization increased 70 basis points year-over-year to 71.5 percent. The company has reaffirmed its outlook for full year time utilization of approximately 68.5 percent.
United Rentals generated $140 million of proceeds from used equipment sales at an adjusted gross margin of 47.9 percent, compared with $102 million and 48 percent for the same period last year. Flow-through, which represents the year-over-year change in adjusted EBITDA divided by the year-over-year change in total revenue, was 51.1 percent for the quarter.
"The third quarter provided further confirmation that our strategy and the North American construction recovery are both solidly on track, said Michael Kneeland, CEO of United Rentals. “Our end markets are continuing to rally, creating numerous opportunities for well-managed, profitable growth. We reported a robust 16 percent increase in rental revenue for the quarter— and more importantly, the discipline behind that growth is evident in our record EBITDA margin and gains in volume, utilization and rates.
"While we reported very strong results, we believe they reflect just a fraction of what our company can achieve over multiple years in the forecasted upcycle. More immediately, we believe that the current uncertainty in the financial markets relates to global concerns, and not North America. We'll continue to take the actions that drive returns over time, including rigorous fleet management, the expansion of our specialty rental lines, and transformational measures for greater productivity."
The size of the rental fleet was $8.61 billion of original equipment cost on Sept., compared with $7.73 billion at the end of 2013. The age of the rental fleet was 42.4 months on an OEC-weighted basis at the end of the third quarter 2014, compared with 45.2 months at the end of 2013.
Stamford, Conn.-based United Rentals is No. 1 on the RER 100.
