Equipment Rental Company Earnings Summary 2Q 2021

Key Takeaways

• Rental companies are optimistic about the near-term outlook, driven by strong demand from both residential and non-residential construction sectors.
• With higher utilization and increased customer demand, rental firms are ramping up their fleet investments.
• Some equipment manufacturers are facing production delays due to component shortages, which could slow new equipment deliveries to rental fleets.
• Most industry players expect the current positive trends to continue in the coming months.

Equipment rental companies are seeing improving fundamentals as both residential and commercial construction activity rebounds post-pandemic. Rising rental rates and better equipment utilization suggest a growing need for more fleet capital. However, some manufacturers are struggling to meet demand, potentially affecting equipment availability later this year.

The sector is showing strong signs of recovery, with many companies reporting improved performance and higher profitability. As demand continues to outpace supply, rental firms are adjusting their strategies to maximize returns and meet customer needs.

Company Outlooks

Alta Equipment

Alta Equipment’s second-quarter results reflect a favorable market environment across material handling and construction sectors. The company notes that supply chain constraints have led to increased demand for higher-margin product support and greater rental usage. Additionally, tighter supply has pushed up equipment prices, creating opportunities for strategic sales and meeting customer needs effectively.

“Our first-half performance, along with a record backlog in our Construction and Material Handling businesses, positions us well to meet our full-year growth goals,” said CEO Ryan Greenawalt.

He also highlighted that rising customer demand, combined with ongoing supply challenges, is driving price appreciation for both new and used equipment, as well as higher rental rates.

View all Alta Equipment locations

United Rentals

United Rentals reported continued recovery in its construction and industrial markets. The company is encouraged by improving end-market indicators, including customer sentiment and project visibility. With recent acquisitions contributing to growth, the company has raised its guidance for the second half of the year.

CEO Matthew Flannery noted, “The recovery is evident across all geographic regions, with consistent rental revenue growth.” He also pointed to the diversity of projects and the strength of activity in key sectors such as manufacturing, corporate campuses, and infrastructure.

“We are seeing project starts in power, transit, and technology, which further supports our positive outlook,” he added.

View all United Rentals locations

Herc Rentals

Herc Rentals’ strong second-quarter performance provides momentum for the rest of 2021. The company saw a 33% increase in total revenues and a 39% rise in adjusted EBITDA compared to last year. CEO Larry Silber stated that the company is investing heavily in fleet expansion, greenfield growth, and M&A activity.

“We’ve decided to invest an additional $100 million in fleet before the end of the year, raising our net fleet capital expenditure guidance to $550 million,” he said. “This reflects our confidence in the ongoing demand and our ability to deliver strong results.”

“We’re clearly in the early stages of a new construction cycle, with steady demand even without any major infrastructure spending boosts,” he added. “Equipment suppliers are still struggling with supply chain issues, but we’re managing to source additional equipment in a tight market.”

View all Herc Rentals locations

Ashtead (Sunbelt Rentals)

Ashtead Group CEO Brendan Horgan noted that current business activity aligns with strong indicators like the Dodge Momentum Index and the ABI. “There seems to be an abundance of momentum in the markets,” he said. Residential construction, in particular, has been a bright spot, with no signs of slowing down.

“Our extensive fleet planning earlier this year proved crucial as OEMs face supply chain and workforce challenges while trying to ramp up production,” he explained.

View all Sunbelt Rentals locations

Find Similar Articles By Topic

#United Rentals #Sunbelt Rentals #Alta Equipment #Herc Rentals #Equipment Rental #Earnings Summary

Shrink Machine

Shrink Machine,Heat Shrink Packing Machine,Heat Shrink Packaging Machine,Heat-Shrink Packaging Machine

Dongguan Chanfer Intelligent Packing Technology Co., Ltd. , https://www.chanfer.com