Essex Rental Corp. last week announced second-quarter 2013 total revenue for the period ended June 30, was $25.2 million, a 7.8-percent decrease from $27.2 million in the year-ago second quarter. Equipment rentals segment revenues were $18.9 million for the three-month period versus $20.6 million for the three-month period ended June 30, 2012. Equipment rentals segment revenues include rental, transportation and used rental equipment sales. The $1.7 million decrease is primarily driven by a $2.5 million decrease in used rental equipment sales and a $300,000 decrease in transportation revenues.
Equipment rental revenue increased by 10 percent to $12.2 million for the second quarter compared to $11.1 million for the second quarter of 2012. EBITDA before non-cash compensation and non-recurring expenses for the quarter increased by 27.1 percent to $5.5 million compared to $4.3 million a year ago. The increase in equipment rental revenues was driven by an increase in both days on rent and average monthly rental rate for crawler crane, self-erecting tower crane and boom truck equipment.
“The continued year-over-year improvement in our operating results in addition to the increased demand for our product offerings is encouraging,” said Ron Schad, president and CEO. “We are pleased to be reporting our highest quarterly EBITDA before non-cash compensation and non-recurring expenses since 2009.”
Crawler crane utilization increased to 46.6 percent for the second quarter of 2013 compared to 39.4 percent and 43.9 percent for the three-month periods ended June 30, 2012 and March 31, 2013, respectively. Crawler crane utilization has increased on a quarter-over-quarter basis in each of the past five quarters and is at its highest level since the first quarter of 2009.
“Particularly encouraging is crawler crane utilization, which is at its highest level since the first quarter of 2009,” Schad added. “Crawler cranes make up approximately 75 percent of the value of our rental fleet, and the increased utilization was a key reason why equipment rental revenue increased by $1.1 million or 10.0 percent compared to the prior year. Utilization of our heavy lift hydraulic crawler crane class was 67.6 percent for the three-month period ended June 30. Average rental rates have also increased on a model-by-model basis by an average of about 6 percent for these types of crawler cranes compared to the second quarter of 2012. These hydraulic crawler cranes have high dollar rental rates and account for approximately 70 percent of the value of our crawler crane fleet and approximately 50 percent of the value of our total fleet.
“The construction market is continuing its gradual recovery,” Schad continued. “Operating initiatives implemented throughout 2012 are yielding an improvement of both gross profit and EBITDA, in both dollars and percentage margin as compared to the prior year. Adjusted EBITDA before non-cash compensation and non-recurring expenses was $20.2 million for the trailing 12-month period ended June 30, compared to $12.0 million for the trailing 12-month period ended June 30, 2012. We have outperformed prior year results in nine of the past 10 quarters by an average of 61 percent and the past six consecutive quarters by an average of 78 percent. We expect this trend of quarter-over-quarter improvement to continue for the remainder of the year.
“Based on our actual first-half results and our visibility for the remainder of the year, we reaffirm that our full-year 2013 EBITDA before non-cash compensation and non-recurring expenses is expected to be in the range of $21 million to $26 million, which is consistent with the earnings guidance that we provided at the beginning of this fiscal year.”
Based in Buffalo Grove, Ill., Essex Crane Rental Corp. is No. 44 on the RER 100.
