United Rentals posted a much improved first quarter with $434 million in rental revenue, a 14.2 percent increase compared with $380 million for the first quarter of 2010. Rental rates hiked 4.2-percent year over year, and volume of equipment on rent jumped 12.8 percent.
Total revenue leapt 9.4 percent, coming in at $523 million compared with $478 million a year ago. Time utilization was 62.4 percent, an increase of 6.2 percentage points from the same period in 2010, and a first-quarter record for United Rentals, which has reduced the size of its fleet compared with a year ago. The company reaffirmed its outlook for an increase in time utilization for the full year of about 1 percent point.
On a GAAP basis, the company reported a first-quarter 2011 net loss of $20 million, or 34 cents per diluted share, compared with a net loss of $40 million, or 67 cents per diluted share for the same period in 2010. United generated $32 million of proceeds from used equipment sales at a gross margin of 43.8 percent, compared with $35 million of proceeds at a gross margin of 31.4 percent for the same period a year ago.
Adjusted EBITDA was $145 million, an increase of $30 million compared with the same period last year. Adjusted EBITDA margin was 27.7 percent, an increase of 3.6 percentage points compared with the same period last year.
“We have started the year with a very solid performance that includes rate improvement in all operating regions and record first-quarter time utilization, as well as stronger gross margins on every major revenue stream,” said Michael Kneeland, United Rentals CEO. “Once again we outpaced our end markets with significant rental revenue growth at a very early stage in the recovery. As demand for our services increases, we are focused on attaining the optimal balance of rate and utilization to drive returns.”
For the first quarter of 2011, free cash flow was $70 million, after total rental and non-rental capital expenditures of $120 million, compared with free cash flow of $99 million for the first quarter of 2010 after rental and non-rental capex of $54 million. The company reaffirmed its outlook for full-year 2011 free cash flow generation in the range of $10 million to $50 million.
The size of the rental fleet was $3.85 billion of original equipment cost on March 31, 2011, compared with $3.79 billion December 31. The age of the rental fleet was 48.2 months March 31, compared with 47.7 months December 31.
For the general rental segment, revenue was $484 million for the first quarter, a 9.3-percent increase compared with $443 million for the year-ago quarter. The trench safety, power and HVAC segment pulled in $39 million, compared with $35 million for the same period a year ago, an 11.4-percent hike.
Total operating margin for all United Rentals was 5.9 percent, compared with 0.8 percent in the year-ago period.
Based in Greenwich, Conn., United Rentals is No. 1 on the RER 100.
