Canadian Equipment Rental Fund (CERF), owner of 4-Way Equipment Rental based in Edmonton, Alberta, posted a 59-percent revenue increase in the first quarter, with CDN $11.4 million (about U.S. $11 million) compared to $7.2 million in the first quarter of 2012. The equipment rental segment increased 83 percent to CDN $8.6 million (about U.S. $8.3 million), compared to $4.7 million in the year-ago frame. The increase was partially the result of the acquisition of TRAC Energy Services, which provides rental equipment to the drilling and service sectors of the oil and natural gas industry, which added $2.9 million in revenue and $1.9 million EBITDA during the first quarter.
Construction equipment rental revenue increased 38 percent organically by $1.2 million to $4.4 million in the first quarter compared to the first quarter of 2012. The waste-management segment revenue increased 13 percent in the quarter to $2.9 million.
Adjusted EBITDA increased 146 percent to $4 million for the first quarter of 2013, compared to $1.6 million for the year-ago period, reflecting the strong EBITDA impact of the TRAC acquisition, as well as strong organic growth in construction equipment rental.
“Increased general economic activity in Alberta combined with strong demand for rental equipment drove all-time record quarterly revenue and EBITDA,” said Wayne Wadley, president and CEO of CERF. “As we mentioned at the time of our 2012 year end and Q4 results, the drivers that drove our business in Q4 2012 continued into Q1 and have continued into Q2 of 2013. In our rental segment, cold weather in the Edmonton operating area that drove the demand for our expanded rental heater fleet in Q4 continued throughout the entire first quarter and continued into the second quarter. The transition into the summer construction season is off to a robust start as equipment specifically suited for summer is already in high demand. The activity level is expected to continue throughout the summer.”
Wadley was equally bullish about the company’s oilfield rental business operated by TRAC. “[TRAC’s business] continued its strong activity in the first quarter with a large percentage of its rental fleet out in the field,” he said. “TRAC has been able to rent a good portion of its fleet throughout spring breakup, which is a bonus to the overall results and we expect the increased demand to continue over the next several months. When road bans are lifted after spring breakup and drilling rigs begin to move and go back to work, TRAC equipment, which has been stored with the rigs, is expected to go back to work as well. TRAC continues to be asked by key customers to supply more equipment in broader geographic regions, validating TRAC’s commitment to high levels of service and the supply of quality rental equipment.”
The equipment rental segment of CERF is No. 85 on the RER 100.
