EX-99.1

EX-99.1 2 mgrc-ex99_1.htm EX-99.1 EX-99.1

第99.1展示文本

联系方式

基思·E·普拉特

EVP及致富金融(临时代码)财务长

925-606-9200

新闻发布稿

2024年10月24日发布

McGrath宣布2024年第三季度业绩

Livermore, CA - 2024年10月24日 – mcgrath rentcorp （“McGrath” 或 “公司”）（纳斯达克: MGRC）是北美领先的业务对业务租赁公司，今日宣布2024年9月30日结束的季度，持续营运总收入为2,6680万美元，较2023年第三季度增长10%。公司报告继续营运的净利润为1,4930万美元，每股摊薄收益6.08美元，较2023年第三季度的1,4040万美元，每股摊薄收益1.65美元增长。从WillScot Mobile Mini收到的1,8000万美元的合并终止费用以及季度内发生的3,940万美元的交易成本除税后，公司报告继续营运的净利润为4,590万美元，每股摊薄收益1.87美元。

2024年第三季度同比公司业绩亮点（来自持续经营）：

•

租赁收入上涨1%至12420万美元。

•

总收益增加10占到$26680万。

•

WillScot mobile mini解除合并的支付公司收到的18000万美元收益, 部分抵消了3940万美元的交易成本和所得税准备金增加，导致该季度净利润贡献10350万美元，每股摊薄收益为4.21美元。

•

调整后的EBITDA1 增长了13%，达到10400万美元。

•

股息率每股$0.475的股息为2024年第三季度。年化基础上，该股息代表2024年10月23日每股$106.23的收益率为1.8%。

McGrath公司总裁兼首席执行官Joe Hanna发表了以下评论：

“我们对第三季度的业绩非常满意。公司整体营收增长10%，主要受到租赁业务和销售收入的提高驱动。”

我们的模块化业务是本季度的亮点，租赁收入增长了9%。租赁收入在商业和教育客户群体中均有增长。我们继续专注于定价优化、租赁车队利用率和为客户提供增值服务。移动模块化增值业务、场地相关服务以及新的模块化设备销售的增长计划都在持续取得进展。

便携式储存需求疲软，导致本季度租金收入较去年同期下降11%。需求疲软在各个地区普遍存在，主要是由于商业施工项目活动减少。

TRS-RenTelco经历持续的需求挑战，导致本季度的租赁收入较一年前下降了10％。在本季度期间，我们保持了谨慎的新设备资本支出，并在减少车队规模方面取得了进展，以更好地适应市场需求。

我感谢麦格拉斯员工团队的坚定承诺，他们在整个季度始终专注于纪律执行。展望未来，我对我们在模块化和便携式存储业务中增加客户群、地理覆盖范围和增值服务的多年机会感到兴奋。

部门亮点：

所有板块的比较均为截至2024年9月30日的季度与2023年9月30日的季度，除非另有说明。

移动模块

2024年第三季度，公司的手机模块部门报告了调整后的EBITDA为7140万美元，比2023年同期增加了1330万美元，增幅为23%。

•

租赁收入增加9％至8150万美元，折旧费用增加11％至1010万美元，其他直接成本减少3％至2050万美元，导致租赁收入毛利润增长14％至5080万美元。

•

与更多的交付和接送活动以及更多的站点相关服务有关，租赁相关服务收入增长了23%，达4240万美元，相应的毛利润增长了32%，达1500万美元。

•

销售收入增长14%，达到6600万美元，主要是因为新设备销售增加。2024年销售的毛利率为34%，相比2023年的32%，导致销售收入的毛利润增加20%，达到2240万美元。销售毛利润的增加主要归因于该季度新销售收入的增加。

•

销售和管理费用增加了220万美元，或7%，达到3400万美元。

便携式存储

2024年第三季度，公司的便携式存储部门报告调整后的EBITDA为1080万美元，与2023年同期相比下降了130万美元，或10%。

•

出租收入下降11%至1700万美元，折旧费用增加10%至100万美元，其他直接成本下降38%至130万美元，导致出租收入的毛利润减少9%至1470万美元。

•

与租赁相关的服务收入为440万美元，租赁相关服务收入的毛利润为10万美元，比2023年第三季度的30万美元下降。

•

销售收入增加30万美元至140万美元，主要来源于二手设备销售的增加。销售毛利率为36%，比2023年的32%高，导致销售收入的毛利润增加10万美元至50万美元。

•

在本季度，销售和管理费用减少120万美元，或15％，至680万美元。

TRS-RenTelco业务

2024年第三季度，公司的TRS-RenTelco部门报告的调整后EBITDA为1890万美元，与2023年同季度相比减少了10%。

•

出租收入下降10%至2570万美元，折旧费用下降10%，其他直接成本增加5%，导致出租收入毛利润下降18%至940万美元。出租收入下降主要是由于终端市场持续疲软，导致与去年相比在租平均租赁设备较少。

•

销售收入下降了13%，达到760万美元，主要是由于二手设备销售额下降。销售毛利率为52%，相比2023年的35%，销售毛利润增加了27%，达到390万美元。

•

销售和管理费用减少了5％，至660万美元。

财务展望：

根据公司本年度截至目前的业绩及对今年余下时间的展望，该公司预计2024年整年的情况如下:


		（持续经营）
•	总营业收入：	910美元至92000万美元
•	调整后的EBITDA1, 2:	345美元至35100万美元
•	租赁设备总资本支出：	180美元至19000万美元

调整后的EBITDA被定义为净利润前的利息费用、所得税准备金、折旧、摊销、非现金减值成本、股权报酬、交易成本、其他收入、净收入和非经营交易。实际净利润与调整后的EBITDA以及调整后的EBITDA与经营活动现金流量净额的调和情况可在本发布的末尾找到。截至2023年9月30日的季度中来自持续经营的调整后的EBITDA不包括来自Adler Tanks出售中止运营所得收入。来自WillScot mobile mini的合并终止所得被视为非经营交易，从调整后的EBITDA中排除。

由于某些用于调和前瞻性调整后的EBITDA与可比GAAP财务指标之间关系的信息并不便于公司获取并且需要付出不合理的努力，因为某些项目要求进行此类调和处于公司的控制范围之外并且/或不能被合理预测，比如所得税的规定。因此，没有提供与最相近的GAAP措施的调和。公司提供调整后的EBITDA指导意见，因为它相信，当与公司根据GAAP的结果一起查看时，调整后的EBITDA提供了有用信息，原因见本文件末尾实际调整后的EBITDA与最直接可比的GAAP措施的调和。

ABOUT MCGRATH:

McGrath RentCorp (Nasdaq: MGRC) is a leading business-to-business rental company in North America with a strong record of profitable business growth. Founded in 1979, McGrath’s operations are centered on modular solutions through its Mobile Modular and Mobile Modular Portable Storage businesses. In addition, its TRS-RenTelco business offers electronic test equipment rental solutions. The Company’s rental product offerings and services are part of the circular supply economy, helping customers work more efficiently, and sustainably manage their environmental footprint. With over 40 years of experience, McGrath’s success is driven by a focus on exceptional customer experiences. This focus has underpinned the Company’s long-term financial success and supported over 30 consecutive years of annual dividend increases to shareholders, a rare distinction among publicly listed companies.

McGrath is headquartered in Livermore, California. Additional information about McGrath and its businesses is available at mgrc.com and investors.mgrc.com.

You should read this press release in conjunction with the financial statements and notes thereto included in the Company’s latest Forms 10-K, 10-Q and other SEC filings. You can visit the Company’s web site at www.mgrc.com to access information on McGrath RentCorp, including the latest Forms 10-K, 10-Q and other SEC filings.

Conference Call Note:

As previously announced in its press release of September 26, 2024, McGrath RentCorp will host a conference call at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) on October 24, 2024 to discuss the third quarter 2024 results. To participate in the teleconference, dial 1-800-245-3047 (in the U.S.), or 1-203-518-9765 (outside the U.S.), or to listen only, access the simultaneous webcast at the investor relations section of the Company’s website at https://investors.mgrc.com/. A replay will be available for 7 days following the call by dialing 1-800-753-9146 (in the U.S.), or 1-402-220-2705 (outside the U.S.). In addition, a live audio webcast and replay of the call may be found in the investor relations section of the Company’s website at https://investors.mgrc.com/events-and-presentations.

FORWARD-LOOKING STATEMENTS:

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, regarding McGrath RentCorp’s expectations, strategies, prospects or targets are forward looking statements. These forward-looking statements also can be identified by the use of forward-looking terminology such as “anticipates,” “believes,” “continues,” “could,” “estimates,” “expects,” “intends,” “may,” “plan,” “predict,” “project,” or “will,” or the negative of these terms or other comparable terminology. In particular, (i) Mr. Hanna’s statements about the Company’s multi-year opportunity to increase its customer base, geographic coverage and value-added service offerings in its Modular and Portable Storage businesses, and (ii) statements regarding the full year 2024 in the “Financial Outlook” section, are forward-looking.

These forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties that could cause our actual results to differ materially from those projected including: health of the education and commercial markets in our modular building division; unforeseen liabilities and integration challenges associated with the Vesta, Brekke

Storage, Dixie Storage and Inland Storage acquisitions; any adverse impact of the termination of the merger with WillScot Mobile Mini; competition within the modular business; the activity levels in the semiconductor and general purpose and communications test equipment markets at TRS-RenTelco; the activity levels in commercial construction projects and impact on Portable Storage segment; continued execution of our strategic performance improvement initiatives; our ability to successfully increase prices to offset cost increases; and our ability to effectively manage our rental assets, as well as the other factors disclosed under “Risk Factors” in the Company’s Form 10-K and other SEC filings.

Forward-looking statements are made only as of the date hereof. Except as otherwise required by law, we assume no obligation to update any of the forward-looking statements contained in this press release.

MCGRATH RENTCORP

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)


	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share amounts)	2024			2023			2024			2023
Revenues
Rental	$	124,203		$	122,686		$	365,708		$	350,773
Rental related services		47,701			40,492			111,640			101,481
Rental operations		171,904			163,178			477,349			452,254
Sales		92,508			77,115			181,992			148,576
Other		2,346			3,213			7,855			9,424
Total revenues		266,758			243,506			667,196			610,254
Costs and Expenses
Direct costs of rental operations:
Depreciation of rental equipment		21,981			22,069			66,512			66,499
Rental related services		32,439			28,532			78,215			71,625
Other		27,252			28,493			84,182			90,188
Total direct costs of rental operations		81,672			79,094			228,909			228,312
Costs of sales		61,107			52,878			117,625			98,431
Total costs of revenues		142,779			131,972			346,534			326,743
Gross profit		123,979			111,534			320,661			283,511
Expenses:
Selling and administrative expenses		49,297			48,508			148,764			153,032
Other income, net		—			(3,559	)		(9,281	)		(3,559	)
Income from operations		74,682			66,585			181,178			134,038
Interest expense		12,641			11,025			38,383			28,434
Foreign currency exchange (gain) loss		(216	)		42			(53	)		(166	)
Gain on merger termination from WillScot Mobile Mini		(180,000	)		—			(180,000	)		—
WillScot Mobile Mini transaction costs		39,436			—			61,157			—
Income from continuing operations before provision for income taxes		202,821			55,518			261,691			105,770
Provision for income taxes from continuing operations		53,504			15,152			68,913			25,934
Income from continuing operations		149,317			40,366			192,778			79,836

Discontinued operations:
Income from discontinued operations before provision for income taxes		—			—			—			1,709
Provision for income taxes from discontinued operations		—			—			—			453
Gain on sale of discontinued operations, net of tax		—			—			—			61,513
Income from discontinued operations		—			—			—			62,769

Net income	$	149,317		$	40,366		$	192,778		$	142,605

Earnings per share from continuing operations:
Basic	$	6.08		$	1.65		$	7.86		$	3.26
Diluted	$	6.08		$	1.65		$	7.85		$	3.26
Earnings per share from discontinued operations:
Basic	$	—		$	—		$	—		$	2.57
Diluted	$	—		$	—		$	—		$	2.56
Earnings per share:
Basic	$	6.08		$	1.65		$	7.86		$	5.83
Diluted	$	6.08		$	1.65		$	7.85		$	5.81
Shares used in per share calculation:
Basic		24,551			24,487			24,538			24,461
Diluted		24,567			24,525			24,564			24,527
Cash dividends declared per share	$	0.475		$	0.465		$	1.425		$	1.395

MCGRATH RENTCORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)


	September 30,			December 31,
(in thousands)	2024			2023
Assets
Cash	$	4,056		$	877
Accounts receivable, net of allowance for credit losses of $2,866 at September 30, 2024 and $2,801 at December 31, 2023		224,529			227,368
Rental equipment, at cost:
Relocatable modular buildings		1,398,422			1,291,093
Portable storage containers		241,620			236,123
Electronic test equipment		356,979			377,587
		1,997,021			1,904,803
Less: accumulated depreciation		(605,339	)		(575,480	)
Rental equipment, net		1,391,682			1,329,323
Property, plant and equipment, net		195,593			169,114
Inventories		22,285			15,425
Prepaid expenses and other assets		67,376			87,364
Intangible assets, net		56,891			64,588
Goodwill		323,224			323,224
Total assets	$	2,285,636		$	2,217,283
Liabilities and Shareholders' Equity
Liabilities:
Notes payable	$	608,562		$	762,975
Accounts payable		76,240			58,760
Accrued liabilities		109,367			108,763
Deferred income		123,925			111,428
Deferred income taxes, net		273,482			241,555
Total liabilities		1,191,576			1,283,481
Shareholders’ equity:
Common stock, no par value - Authorized 40,000 shares
Issued and outstanding - 24,551 shares as of September 30, 2024 and 24,496 shares as of December 31, 2023		113,989			111,122
Retained earnings		980,244			822,796
Accumulated other comprehensive loss		(173	)		(116	)
Total shareholders’ equity		1,094,060			933,802
Total liabilities and shareholders’ equity	$	2,285,636		$	2,217,283

MCGRATH RENTCORP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


	Nine Months Ended September 30,
(in thousands)	2024			2023
Cash Flows from Operating Activities:
Net income	$	192,778		$	142,605
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		80,824			81,842
Deferred income taxes		31,927			(30,018	)
Provision for credit losses		1,437			1,794
Share-based compensation		6,949			5,273
Gain on sale of property, plant and equipment		(9,281	)		(3,559	)
Gain on sale of discontinued operations		—			(61,513	)
Gain on sale of used rental equipment		(25,185	)		(22,964	)
Foreign currency exchange gain		(53	)		(166	)
Amortization of debt issuance costs		6			6
Change in:
Accounts receivable		1,402			(27,733	)
Inventories		(6,860	)		(1,988	)
Prepaid expenses and other assets		19,988			(5,402	)
Accounts payable		30,562			22,513
Accrued liabilities		605			10,305
Deferred income		12,497			7,908
Net cash provided by operating activities		337,596			118,903
Cash Flows from Investing Activities:
Proceeds from sale of discontinued operations		—			268,012
Purchases of rental equipment		(167,269	)		(171,322	)
Purchases of property, plant and equipment		(36,070	)		(16,448	)
Cash paid for acquisition of businesses		—			(458,315	)
Cash paid for acquisition of business assets		—			(3,474	)
Proceeds from sales of used rental equipment		50,270			49,405
Proceeds from sales of property, plant and equipment		12,251			595
Net cash used in investing activities		(140,818	)		(331,547	)
Cash Flows from Financing Activities:
Net (payments) borrowings under bank lines of credit		(154,420	)		178,892
Borrowings under term note agreement		—			75,000
Taxes paid related to net share settlement of stock awards		(4,082	)		(6,100	)
Payment of dividends		(35,097	)		(34,168	)
Net cash (used in) provided by financing activities		(193,599	)		213,624
Effect of foreign currency exchange rate changes on cash		—			9
Net increase in cash		3,179			989
Cash balance, beginning of period		877			957
Cash balance, end of period	$	4,056		$	1,946
Supplemental Disclosure of Cash Flow Information:
Gain on merger termination, net of transaction costs, presented under net cash provided by operating activities	$	118,843		$	—
Interest paid, during the period	$	40,338		$	27,818
Net income taxes (refunded) paid, during the period	$	(3,826	)	$	9,547
Dividends accrued during the period, not yet paid	$	12,241		$	12,014
Rental equipment acquisitions, not yet paid	$	3,333		$	5,765


MCGRATH RENTCORP
BUSINESS SEGMENT DATA (unaudited)
Three months ended September 30, 2024
(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS-RenTelco			Enviroplex		Consolidated
Revenues
Rental	$	81,508		$	17,040		$	25,655		$	—	$	124,203
Rental related services		42,396			4,405			900			—		47,701
Rental operations		123,904			21,445			26,555			—		171,904
Sales		65,994			1,411			7,604			17,499		92,508
Other		1,509			195			642			—		2,346
Total revenues		191,407			23,051			34,801			17,499		266,758

Costs and Expenses
Direct costs of rental operations:
Depreciation		10,124			1,006			10,851			—		21,981
Rental related services		27,366			4,280			793			—		32,439
Other		20,549			1,327			5,376			—		27,252
Total direct costs of rental operations		58,039			6,613			17,020			—		81,672
Costs of sales		43,595			906			3,688			12,918		61,107
Total costs of revenues		101,634			7,519			20,708			12,918		142,779

Gross Profit
Rental		50,835			14,707			9,428			—		74,970
Rental related services		15,030			125			107			—		15,262
Rental operations		65,865			14,832			9,535			—		90,232
Sales		22,399			505			3,916			4,581		31,401
Other		1,509			195			642			—		2,346
Total gross profit		89,773			15,532			14,093			4,581		123,979
Selling and administrative expenses 6		34,028			6,790			6,627			1,851		49,296
Other income		—			—			—			—		—
Income from operations	$	55,745		$	8,742		$	7,466		$	2,730		74,683
Interest expense													(12,641	)
Foreign currency exchange gain													216
Gain on merger termination from WillScot Mobile Mini													180,000
WillScot Mobile Mini transaction costs													(39,436	)
Provision for income taxes													(53,504	)
Net income												$	149,317

Other Information
Adjusted EBITDA 1	$	71,420		$	10,796		$	18,945		$	2,822	$	103,983
Average rental equipment 2	$	1,240,950		$	229,231		$	362,431
Average monthly total yield 3		2.19	%		2.48	%		2.36	%
Average utilization 4		77.1	%		62.8	%		57.3	%
Average monthly rental rate 5		2.84	%		3.94	%		4.12	%

2. Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment.

3. Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period.

4. Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment.

5. Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period.

6. During the period ended September 30, 2024, the Company determined that transaction costs incurred by the Company attributed to the terminated Merger Agreement were significant. Due to this determination, the Company has separately reported these transaction costs in the Company's Corporate segment and excluded such costs from Selling and administrative expenses.


MCGRATH RENTCORP
BUSINESS SEGMENT DATA (unaudited)
Three months ended September 30, 2023
(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS-RenTelco			Enviroplex		Consolidated
Revenues
Rental	$	74,796		$	19,232		$	28,658		$	—	$	122,686
Rental related services		34,429			5,287			776			—		40,492
Rental operations		109,225			24,519			29,434			—		163,178
Sales		57,723			1,144			8,733			9,515		77,115
Other		1,908			363			942			—		3,213
Total revenues		168,856			26,026			39,109			9,515		243,506

Costs and Expenses
Direct costs of rental operations:
Depreciation		9,123			914			12,032			—		22,069
Rental related services		23,033			4,894			605			—		28,532
Other		21,222			2,131			5,140			—		28,493
Total direct costs of rental operations		53,378			7,939			17,777			—		79,094
Costs of sales		39,039			782			5,651			7,406		52,878
Total costs of revenues		92,417			8,721			23,428			7,406		131,972

Gross Profit
Rental		44,451			16,187			11,486			—		72,124
Rental related services		11,395			394			171			—		11,960
Rental operations		55,846			16,581			11,657			—		84,084
Sales		18,684			362			3,082			2,109		24,237
Other		1,908			363			942			—		3,213
Total gross profit		76,438			17,306			15,681			2,109		111,534
Selling and administrative expenses		31,813			8,019			6,999			1,677		48,508
Other income		(2,290	)		(450	)		(819	)		—		(3,559	)
Income from operations	$	46,915		$	9,737		$	9,501		$	432		66,585
Interest expense													(11,025	)
Foreign currency exchange loss													(42	)
Provision for income taxes													(15,152	)
Net income												$	40,366

Other Information
Adjusted EBITDA 1	$	58,166		$	12,047		$	21,039		$	517	$	91,769
Average rental equipment 2	$	1,137,675		$	212,888		$	385,353
Average monthly total yield 3		2.19	%		3.01	%		2.46	%
Average utilization 4		79.9	%		76.5	%		59.4	%
Average monthly rental rate 5		2.74	%		3.94	%		4.17	%

2. Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment.

3. Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period.

4. Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment.

5. Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period.


MCGRATH RENTCORP
BUSINESS SEGMENT DATA (unaudited)
Nine months ended September 30, 2024
(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS-RenTelco			Enviroplex		Consolidated
Revenues
Rental	$	236,040		$	53,270		$	76,398		$	—	$	365,708
Rental related services		95,450			13,768			2,422			—		111,640
Rental operations		331,490			67,039			78,820			—		477,349
Sales		127,251			3,889			20,261			30,591		181,992
Other		4,795			907			2,153			—		7,855
Total revenues		463,536			71,835			101,234			30,591		667,196

Costs and Expenses
Direct costs of rental operations:
Depreciation		29,994			2,971			33,547			—		66,512
Rental related services		62,974			13,212			2,029			—		78,215
Other		64,487			4,322			15,373			—		84,182
Total direct costs of rental operations		157,455			20,505			50,949			—		228,909
Costs of sales		83,180			2,390			9,346			22,709		117,625
Total costs of revenues		240,635			22,895			60,295			22,709		346,534

Gross Profit
Rental		141,559			45,977			27,478			—		215,014
Rental related services		32,476			556			393			—		33,425
Rental operations		174,035			46,533			27,871			—		248,439
Sales		44,071			1,499			10,915			7,882		64,367
Other		4,795			907			2,153			—		7,855
Total gross profit		222,901			48,939			40,939			7,882		320,661
Selling and administrative expenses 6		100,882			22,064			20,450			5,368		148,764
Other income		(6,220	)		(1,319	)		(1,742	)		—		(9,281	)
Income from operations	$	128,239		$	28,194		$	22,231		$	2,514		181,178
Interest expense													(38,383	)
Foreign currency exchange gain													53
Gain on merger termination from WillScot Mobile Mini													180,000
WillScot Mobile Mini transaction costs													(61,157	)
Provision for income taxes													(68,913	)
Net income												$	192,778

Other Information
Adjusted EBITDA 1	$	168,165		$	33,333		$	55,426		$	2,799	$	259,723
Average rental equipment 2	$	1,206,361		$	226,373		$	367,137
Average monthly total yield 3		2.17	%		2.61	%		2.31	%
Average utilization 4		78.0	%		66.1	%		56.8	%
Average monthly rental rate 5		2.79	%		3.95	%		4.07	%

2. Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment.

3. Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period.

4. Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment.

5. Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period.


MCGRATH RENTCORP
BUSINESS SEGMENT DATA (unaudited)
Nine months ended September 30, 2023
(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS-RenTelco			Enviroplex			Consolidated
Revenues
Rental	$	209,622		$	54,776		$	86,375		$	—		$	350,773
Rental related services		83,799			15,359			2,323			—			101,481
Rental operations		293,421			70,135			88,698			—			452,254
Sales		112,939			2,890			21,368			11,379			148,576
Other		5,249			1,167			3,008			—			9,424
Total revenues		411,609			74,192			113,074			11,379			610,254

Costs and Expenses
Direct costs of rental operations:
Depreciation		27,196			2,570			36,733			—			66,499
Rental related services		55,702			13,916			2,007			—			71,625
Other		68,726			5,619			15,843			—			90,188
Total direct costs of rental operations		151,624			22,105			54,583			—			228,312
Costs of sales		76,303			1,799			11,307			9,022			98,431
Total costs of revenues		227,927			23,904			65,890			9,022			326,743

Gross Profit
Rental		113,700			46,587			33,799			—			194,086
Rental related services		28,097			1,443			316			—			29,856
Rental operations		141,797			48,030			34,115			—			223,942
Sales		36,636			1,091			10,061			2,357			50,145
Other		5,249			1,167			3,008			—			9,424
Total gross profit		183,682			50,288			47,184			2,357			283,511
Selling and administrative expenses		101,360			23,282			23,576			4,814			153,032
Other income		(2,290	)		(450	)		(819	)		—			(3,559	)
Income (loss) from operations	$	84,612		$	27,456		$	24,427		$	(2,457	)		134,038
Interest expense														(28,434	)
Foreign currency exchange gain														166
Provision for income taxes														(25,934	)
Net income													$	79,836

Other Information
Adjusted EBITDA 1	$	135,107		$	34,375		$	63,212		$	(2,207	)	$	230,487
Average rental equipment 2	$	1,073,384		$	201,946		$	391,993
Average monthly total yield 3		2.17	%		3.01	%		2.43	%
Average utilization 4		79.7	%		78.4	%		59.0	%
Average monthly rental rate 5		2.72	%		3.84	%		4.15	%

2. Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment.

3. Average monthly total yield is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment for the period.

4. Average utilization is calculated by dividing the average month end costs of rental equipment on rent by the average month end total costs of rental equipment.

5. Average monthly rental rate is calculated by dividing the averages of monthly rental revenues by the cost of rental equipment on rent for the period.

Reconciliation of Adjusted EBITDA to the most directly comparable GAAP measures

To supplement the Company’s financial data presented on a basis consistent with accounting principles generally accepted in the United States of America (“GAAP”), the Company presents “Adjusted EBITDA”, which is defined by the Company as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, transaction costs, gains on property sales and non-operating transactions. The gain on merger termination from WillScot Mobile Mini was considered a non-operating transaction and is excluded from Adjusted EBITDA. The Company presents Adjusted EBITDA as a financial measure as management believes it provides useful information to investors regarding the Company’s liquidity and financial condition and because management, as well as the Company’s lenders, use this measure in evaluating the performance of the Company.

Management uses Adjusted EBITDA as a supplement to GAAP measures to further evaluate period-to-period operating performance, compliance with financial covenants in the Company’s revolving lines of credit and senior notes and the Company’s ability to meet future capital expenditure and working capital requirements. Management believes the exclusion of non-cash charges and non-recurring transactions, including share-based compensation, transaction costs, gains on property sales and non-operating transactions, is useful in measuring the Company’s cash available for operations and performance of the Company. Because management finds Adjusted EBITDA useful, the Company believes its investors will also find Adjusted EBITDA useful in evaluating the Company’s performance.

Adjusted EBITDA should not be considered in isolation or as a substitute for net income, cash flows, or other consolidated income or cash flow data prepared in accordance with GAAP or as a measure of the Company’s profitability or liquidity. Adjusted EBITDA is not in accordance with or an alternative for GAAP and may be different from non−GAAP measures used by other companies. Unlike EBITDA, which may be used by other companies or investors, Adjusted EBITDA does not include share-based compensation charges, transaction costs, gains on property sales and non-operating transactions. The Company believes that Adjusted EBITDA is of limited use in that it does not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP and does not accurately reflect real cash flow. In addition, other companies may not use Adjusted EBITDA or may use other non-GAAP measures, limiting the usefulness of Adjusted EBITDA for purposes of comparison. The Company’s presentation of Adjusted EBITDA should not be construed as an inference that the Company will not incur expenses that are the same as or similar to the adjustments in this presentation. Therefore, Adjusted EBITDA should only be used to evaluate the Company’s results of operations in conjunction with the corresponding GAAP measures. The Company compensates for the limitations of Adjusted EBITDA by relying upon GAAP results to gain a complete picture of the Company’s performance. Because Adjusted EBITDA is a non-GAAP financial measure, as defined by the SEC, the Company includes in the tables below reconciliations of Adjusted EBITDA to the most directly comparable financial measures calculated and presented in accordance with GAAP.

Reconciliation of Income from Continuing Operations to Adjusted EBITDA


(dollar amounts in thousands)	Three Months Ended September 30,						Nine Months Ended September 30,						Twelve Months Ended September 30,
	2024			2023			2024			2023			2024			2023
Income from continuing operations	$	149,317		$	40,366		$	192,778		$	79,836		$	224,799		$	114,828
Provision for income taxes from continuing operations		53,502			15,152			68,913			25,934			80,586			35,624
Interest expense		12,642			11,025			38,383			28,434			50,509			32,607
Depreciation and amortization		26,693			26,884			80,824			80,385			108,357			103,893
EBITDA		242,154			93,427			380,898			214,589			464,249			286,952
Share-based compensation		2,393			1,891			6,949			5,155			9,951			7,658
Transaction costs 3		39,436			10			61,157			14,302			62,732			18,188
Other income, net 4		—			(3,559	)		(9,281	)		(3,559	)		(9,340	)		(3,559	)
Gain on merger termination from WillScot Mobile Mini 5		(180,000	)		—			(180,000	)		—			(180,000	)		—
Adjusted EBITDA 1	$	103,983		$	91,769		$	259,723		$	230,487		$	347,592		$	309,239
Adjusted EBITDA margin 2		39	%		39	%		38	%		38	%		39	%		39	%

Reconciliation of Adjusted EBITDA to Net Cash Provided by Operating Activities


(dollar amounts in thousands)	Three Months Ended September 30,						Nine Months Ended September 30,						Twelve Months Ended September 30,
	2024			2023			2024			2023			2024			2023
Adjusted EBITDA 1	$	103,983		$	91,769		$	259,723		$	234,169		$	347,592		$	325,138
Interest paid		(13,944	)		(11,016	)		(40,338	)		(27,818	)		(51,123	)		(33,611	)
Income taxes paid, net of refunds received		(773	)		(2,616	)		3,826			(9,547	)		(78,192	)		(12,024	)
Gain on sale of used rental equipment		(9,648	)		(8,714	)		(25,185	)		(22,964	)		(33,863	)		(34,238	)
Foreign currency exchange loss		(216	)		42			(53	)		(166	)		(197	)		(192	)
Amortization of debt issuance costs		2			2			6			6			8			9
Change in certain assets and liabilities:
Accounts receivable, net		(7,150	)		(26,223	)		2,839			(25,939	)		(6,365	)		(26,003	)
Prepaid expenses and other assets		14,171			1,114			19,988			(7,390	)		(1,948	)		(6,561	)
Accounts payable and other liabilities		123,241			4,476			104,293			(29,356	)		119,382			(30,691	)
Deferred income		(10,699	)		(1,382	)		12,497			7,908			18,683			(1,790	)
Net cash provided by operating activities	$	198,967		$	47,452		$	337,596		$	118,903		$	313,977		$	180,037

1. Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, amortization, non-cash impairment costs, share-based compensation, other income, net and non-operating transactions. Adjusted EBITDA for the nine months ended September 30, 2023, excludes the gain on sale of discontinued operations from the divestiture of Adler Tanks. Total Adjusted EBITDA attributed to discontinued operations for the nine month period ended September 30, 2023 was $3,682.

2. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by total revenues for the period.

3. Transaction costs include acquisition and divestiture related legal and professional fees and other costs specific to these transactions.

4. Other income, net consists of net gains on property, plant and equipment sales that are infrequent in nature and excluded from Adjusted EBITDA.

5. The gain on merger termination from WillScot Mobile Mini was considered a non-operating transaction and is excluded from Adjusted EBITDA.