EVANSTON, Ill. — National Equipment Services posted a net loss of $621,000 in the second quarter, down from a $5.8 million net gain in the second quarter of 2000. Its operating income also dropped 33.4 percent to $20.2 million from $30.3 million year over year. CEO Kevin Rodgers primarily attributed the results to “a sluggish economy, particularly in the Midwest,” the region where NES has its highest concentration of branches.
The news wasn't all bad, however, for the company. It posted a 3.9 percent increase in total revenue to $164.8 million, up from $158.7 million in last year's second quarter. It also boosted rental revenue 1 percent to $118.9 percent from $117.8 million. The company managed to pay $20 million in debt from operating cash flow in the quarter, totaling $30 million in debt reduction year to date.
“Even with no economic improvement over the rest of the year, we expect to achieve our 2001 goal of reducing debt by at least $100 million,” Rodgers added. “We will continue to focus primarily on debt reduction and asset management, which will put us in a better position to accelerate revenue growth and earnings once the economy improves.”
While rental revenue was essentially flat, the company grew new equipment sales 14 percent, fleet sales 18 percent and parts and services 8 percent. Selling, general and administrative expenses grew $3 million to fund additional investments in personnel and systems.
NES is No. 6 on the RER 100 with nearly 200 locations in the United States.
