Essex Rental Corp. this week announced total revenues for the three months ended Sept. 30, of $23.3 million, a sharp increase attributable to the acquisition of Coast Crane in Q410 from total revenues of $8.8 million in the same period a year ago. Equipment rental revenues in the Q311 were $10.7 million, a 41-percent increase from $6.3 million year over year. Equipment rentals segment revenues, however, decreased 2.7 percent in the third quarter to $14.4 million versus $14.6 million for the second quarter of 2011.
Gross profit increased by $0.8 million or 24.2 percent to $3.8 million for the third quarter vs. $3.0 million for the second quarter ended June 30. Gross profit margin increased by approximately 2.6 percent to 16.2 percent for the third quarter from 13.6 percent for the second quarter. The improvement in gross profit dollars and gross profit percentage margin resulted from an increase in rental revenue, an increase in equipment distribution revenue and a decline in costs incurred related to non-billable rental equipment repair work.
Total EBITDA, excluding approximately $0.7 million for non cash compensation and one-time acquisition related expenses, increased by 69.6 percent to $3.0 million in the third quarter versus $1.7 million in the prior quarter.
“We continue to experience modest growth in our crawler crane fleet on a quarter over quarter basis,” said Ron Schad, president and CEO of Essex Rental Corp. “Rental rates remain stable, as they have been for the last several quarters. We are cautiously optimistic about continuing utilization improvements in boom trucks and certain categories of our rough terrain crane and tower crane fleets. Certain classes of our rough terrain and boom truck fleets are at utilization levels that we believe will allow us to raise rental rates in the foreseeable future. The implementation of our IT systems at Coast, which went live on August 1, is now providing us with the necessary data to more effectively manage price and utilization of the Coast rental fleet, which we believe will allow us to benefit from the inherent operating leverage in our business over the coming quarters.”
Crawler crane utilization increased to 39.5 percent in the third quarter from 38.6 percent for the quarter ended June 30, and average crawler crane rental rates increased by $521, or 3 percent, to $15,868 from $15,347. Excluding levee related cranes, crawler crane utilization increased to 39.1 percent for the three month period ended Sept. 30, compared to 34.4 percent for the same period in the prior year.
For the third quarter, utilization was in excess of 60 percent for both the company’s rough terrain cranes and its boom truck fleet. Utilization rates for self-erecting tower cranes increased by nearly 7.9 percent on a quarter-over quarter basis.
New, used and rental equipment sales totaled $5.8 million in the 2011 third quarter, a 9.1-percent increase on a sequential quarter basis; and EBITDA, excluding approximately $0.7 million for non cash compensation and one-time acquisition related expenses increased by 69.6 percent to $3.0 million in the 2011 third quarter versus $1.7 million in the prior quarter ended June 30.
“By the end of the fourth quarter of 2011, we will have taken delivery on the bulk of the approximately $28 million of new equipment that we have ordered,” Schad said. “This equipment is specifically focused on increasing our rental capacity in the asset classes where we have experienced the highest utilization of our rental fleet, specifically rough terrain cranes and boom trucks. We believe that as these assets are deployed, they will be a near-term catalyst for growing our revenue stream. With our IT platform now in place at Coast we are beginning to have access to the necessary data to make decisions which will enable us to not only maximize asset mix and utilization but also better manage the parts and service and equipment distribution segments of the business and capture efficiencies throughout the entire company.”
Based in Buffalo Grove, Ill., Essex Rental Corp. is No. 61 on the RER 100. Seattle-based Coast Crane is No. 51.
