|
United Rentals Announces Third Quarter 2017 Results
STAMFORD, Conn.
Raises Full-Year 2017 Guidance
United Rentals, Inc. (NYSE:URI) today announced financial results for
the third quarter 2017. Total revenue was $1.766 billion and rental
revenue was $1.536 billion for the third quarter, compared with $1.508
billion and $1.322 billion, respectively, for the same period last year.
On a GAAP basis, the company reported third quarter net income of $199
million, or $2.33 per diluted share, compared with $187 million, or
$2.16 per diluted share, for the same period last year.
Adjusted EPS1 for the quarter was $3.25 per diluted share,
compared with $2.58 per diluted share for the same period last year.
Adjusted EBITDA1 was $879 million and adjusted EBITDA margin1
was 49.8%, reflecting increases of $132 million and 30 basis points,
respectively, from the same period last year.
Third Quarter 2017 Highlights
-
Rental revenue2 increased 16.2% year-over-year. Within
rental revenue, owned equipment rental revenue increased 15.8%,
reflecting increases of 18.2% in the volume of equipment on rent and
0.1% in rental rates.
-
Pro forma3 rental revenue increased 8.9% year-over-year,
reflecting growth of 7.6% in the volume of equipment on rent and a
0.9% increase in rental rates.
-
Time utilization increased 160 basis points year-over-year to 71.9%, a
third quarter record, with each month in the quarter also establishing
a new monthly record. On a pro forma basis, time utilization increased
180 basis points year-over-year.
-
The company’s Trench, Power and Pump specialty segment's rental
revenue increased by 32.9% year-over-year, primarily on a same store
basis, while the segment’s rental gross margin improved by 280 basis
points to 54.8%.
-
The company generated $139 million of proceeds from used equipment
sales at a GAAP gross margin of 39.6% and an adjusted gross margin of
56.8%, compared with $112 million at a GAAP gross margin of 39.3% and
an adjusted gross margin of 46.4% for the same period last year. The
year-over-year increase in adjusted gross margin primarily reflected
the impact of sales of NES equipment.4
|
_______________
|
|
1.
|
|
Adjusted EPS (earnings per share) and adjusted EBITDA (earnings
before interest, taxes, depreciation and amortization) are non-GAAP
measures that exclude the impact of the items noted in the tables
below. See the tables below for amounts and reconciliations to the
most comparable GAAP measures. Adjusted EBITDA margin represents
adjusted EBITDA divided by total revenue.
|
|
2.
|
|
Rental revenue includes owned equipment rental revenue, re-rent
revenue and ancillary revenue.
|
|
3.
|
|
Pro forma results reflect the combination of United Rentals and NES
Rentals ("NES") for all periods presented. The NES acquisition
closed on April 3, 2017.
|
|
4.
|
|
Used equipment sales adjusted gross margin excludes the impact of
the fair value mark-up of acquired RSC and NES fleet that was sold.
|
|
|
|
|
Acquisition of Neff Corporation
Subsequent to the third quarter, on October 2, the company completed its
previously announced acquisition of Neff Corporation (“Neff”) for
approximately $1.3 billion. The acquisition will augment the company’s
earthmoving capabilities and efficiencies of scale in key market areas,
particularly fast-growing southern geographies. The assets acquired
included approximately $860 million of fleet based on original equipment
cost ("OEC"), and 69 branch facilities serving end markets across the
infrastructure, non-residential, energy, municipal and residential
construction sectors.
CEO Comments
Michael Kneeland, chief executive officer of United Rentals, said,
"We’re very pleased with the gains we reported for the third quarter.
These include significantly higher volume and time utilization, margin
growth, and strong cash flow. Importantly, we delivered positive rental
rates both sequentially and year-over-year for every month in the
quarter. Our U.S. end markets are driving robust demand for our fleet,
and Canada is continuing to rebound. Given these many positive dynamics,
and the extended hurricane recoveries, we’ve raised our 2017 gross capex
plan by up to $200 million to best serve the current and anticipated
needs of our customers."
Kneeland continued, "Looking at the balance of 2017, our updated
guidance reflects the combination of a fundamentally strong market and
the contributions from our acquisitions this year. The integration of
Neff is well underway, with all locations on our operating system. We
expect fourth quarter market activity to exceed normal seasonality, and
based on everything we see, we have confidence in the operating
environment for 2018."
Nine Months 2017 Highlights
-
Rental revenue increased 11.7% year-over-year. Within rental revenue,
owned equipment rental revenue increased 11.3%, reflecting an increase
of 14.5% in the volume of equipment on rent, partially offset by a
0.7% decrease in rental rates.
-
Pro forma rental revenue increased 6.5% year-over-year, reflecting
growth of 6.9% in the volume of equipment on rent, partially offset by
a 0.2% decline in rental rates.
-
Time utilization increased 190 basis points year-over-year on both an
actual and a pro forma basis to 69.3% and 69.0%, respectively.
-
The company’s Trench, Power and Pump specialty segment's rental
revenue increased by 23.6% year-over-year, primarily on a same store
basis, while the segment’s rental gross margin improved by 280 basis
points to 50.4%.
-
The company generated $378 million of proceeds from used equipment
sales at a GAAP gross margin of 40.5% and an adjusted gross margin of
53.7%, compared with $361 million at a GAAP gross margin of 40.4% and
an adjusted gross margin of 47.6% for the same period last year. The
year-over-year increase in adjusted gross margin primarily reflected
the impact of sales of NES equipment.
-
The company generated $1.766 billion of net cash provided by operating
activities and $582 million of free cash flow5, compared
with $1.630 billion and $846 million, respectively, for the same
period last year. Net rental capital expenditures were $1.107 billion,
compared with $784 million for the same period last year.
-
The company issued $2.925 billion of debt due from 2025 through 2028.
The proceeds from the debt issuances were primarily used to fund the
NES and Neff acquisitions, and to redeem $1.175 billion of debt that
would have been due in 2022 and 2023. The company additionally
increased the sizes of its ABL and AR securitization facilities by
$500 million and $50 million, respectively. The company expects to
redeem the remaining $225 million principal amount of its 7 5/8
percent Senior Notes due 2022 in the fourth quarter of 2017.
|
___________
|
|
5.
|
|
Free cash flow is a non-GAAP measure. See the table below for
amounts and a reconciliation to the most comparable GAAP measure.
|
|
|
|
|
2017 Outlook
The company has issued the following new full-year guidance:
|
|
|
|
|
|
|
|
|
|
Prior Outlook
|
|
|
Current Outlook
|
|
Total revenue
|
|
$6.25 billion to $6.40 billion
|
|
|
$6.525 billion to $6.625 billion
|
|
Adjusted EBITDA6
|
|
$2.950 billion to $3.025 billion
|
|
|
$3.10 billion to $3.15 billion
|
|
Net rental capital expenditures after gross purchases
|
|
$1.05 billion to $1.15 billion, after
gross purchases of
$1.55 billion to $1.65 billion
|
|
|
$1.25 billion to $1.30 billion, after gross
purchases of
$1.75 billion to $1.80 billion
|
|
Net cash provided by operating activities
|
|
$1.975 billion to $2.175 billion
|
|
|
$2.275 billion to $2.375 billion
|
|
Free cash flow (excluding the impact of
merger and
restructuring related costs)
|
|
$825 million to $925 million
|
|
|
$925 million to $975 million
|
|
|
|
|
|
|
|
Free Cash Flow and Fleet Size
For the first nine months of 2017, net cash provided by operating
activities was $1.766 billion, and free cash flow was $582 million after
total rental and non-rental gross capital expenditures of $1.572
billion. For the first nine months of 2016, net cash provided by
operating activities was $1.630 billion, and free cash flow was $846
million after total rental and non-rental gross capital expenditures of
$1.210 billion. Free cash flow for the first nine months of 2017 and
2016 included aggregate merger and restructuring related payments of $52
million and $11 million, respectively.
The size of the rental fleet was $10.76 billion of OEC at September 30,
2017, compared with $8.99 billion at December 31, 2016. The age of the
rental fleet was 46.3 months on an OEC-weighted basis at September 30,
2017, compared with 45.2 months at December 31, 2016.
Return on Invested Capital (ROIC)
Return on invested capital was 8.6% for the 12 months ended
September 30, 2017, an increase of 30 basis points from the 12 months
ended September 30, 2016. The company’s ROIC metric uses after-tax
operating income for the trailing 12 months divided by average
stockholders’ equity, debt and deferred taxes, net of average cash. To
mitigate the volatility related to fluctuations in the company’s tax
rate from period to period, the federal statutory tax rate of 35% is
used to calculate after-tax operating income. When adjusting the
denominator to also exclude average goodwill, ROIC was 11.5% for the 12
months ended September 30, 2017, an increase of 30 basis points from the
12 months ended September 30, 2016.
Share Repurchase Program
The company announced that it will resume its pre-existing $1 billion
program to repurchase shares of its common stock (the “Program”). The
Program commenced in November 2015 and was paused in October 2016 as the
company evaluated potential acquisition opportunities. The company has
already completed $627 million of repurchases under the Program, and
intends to complete the remaining $373 million in 2018.
Conference Call
United Rentals will hold a conference call tomorrow, Thursday,
October 19, 2017, at 11:00 a.m. Eastern Time. The conference call number
is 855-458-4217 (international: 574-990-3605). The conference call will
also be available live by audio webcast at unitedrentals.com,
where it will be archived until the next earnings call. The replay
number for the call is 404-537-3406, passcode is 90999400.
|
_____________
|
|
6.
|
|
Information reconciling forward-looking adjusted EBITDA to the
comparable GAAP financial measures is unavailable to the company
without unreasonable effort, as discussed below.
|
|
|
|
|
Non-GAAP Measures
Free cash flow, earnings before interest, taxes, depreciation and
amortization (EBITDA), adjusted EBITDA, and adjusted earnings per share
(adjusted EPS) are non-GAAP financial measures as defined under the
rules of the SEC. Free cash flow represents net cash provided by
operating activities, less purchases of rental and non-rental equipment
plus proceeds from sales of rental and non-rental equipment and excess
tax benefits from share-based payment arrangements. EBITDA represents
the sum of net income, provision for income taxes, interest expense,
net, depreciation of rental equipment and non-rental depreciation and
amortization. Adjusted EBITDA represents EBITDA plus the sum of the
merger related costs, restructuring charge, stock compensation expense,
net, and the impact of the fair value mark-up of acquired RSC and NES
fleet. Adjusted EPS represents EPS plus the sum of the merger related
costs, restructuring charge, the impact on depreciation related to
acquired RSC and NES fleet and property and equipment, the impact of the
fair value mark-up of acquired RSC and NES fleet, the impact on interest
expense related to fair value adjustment of acquired RSC indebtedness,
merger related intangible asset amortization, asset impairment charge
and the loss on repurchase/redemption of debt securities and amendment
of ABL facility. The company believes that: (i) free cash flow provides
useful additional information concerning cash flow available to meet
future debt service obligations and working capital requirements; (ii)
EBITDA and adjusted EBITDA provide useful information about operating
performance and period-over-period growth, and help investors gain an
understanding of the factors and trends affecting our ongoing cash
earnings, from which capital investments are made and debt is serviced;
and (iii) adjusted EPS provides useful information concerning future
profitability. However, none of these measures should be considered as
alternatives to net income, cash flows from operating activities or
earnings per share under GAAP as indicators of operating performance or
liquidity.
Information reconciling forward-looking adjusted EBITDA to GAAP
financial measures is unavailable to the company without unreasonable
effort. The company is not able to provide reconciliations of adjusted
EBITDA to GAAP financial measures because certain items required for
such reconciliations are outside of the company’s control and/or cannot
be reasonably predicted, such as the provision for income taxes.
Preparation of such reconciliations would require a forward-looking
balance sheet, statement of income and statement of cash flow, prepared
in accordance with GAAP, and such forward-looking financial statements
are unavailable to the company without unreasonable effort. The company
provides a range for its adjusted EBITDA forecast that it believes will
be achieved, however it cannot accurately predict all the components of
the adjusted EBITDA calculation. The company provides an adjusted EBITDA
forecast because it believes that adjusted EBITDA, when viewed with the
company’s results under GAAP, provides useful information for the
reasons noted above. However, adjusted EBITDA is not a measure of
financial performance or liquidity under GAAP and, accordingly, should
not be considered as an alternative to net income or cash flow from
operating activities as an indicator of operating performance or
liquidity.
About United Rentals
United Rentals, Inc. is the largest equipment rental company in the
world. Following the acquisition of Neff, the company has an integrated
network of 1,019 rental locations in 49 states and every Canadian
province. The company’s approximately 15,000 employees serve
construction and industrial customers, utilities, municipalities,
homeowners and others. The company offers approximately 3,300 classes of
equipment for rent with a total original cost of $11.6 billion. United
Rentals is a member of the Standard & Poor’s 500 Index, the Barron’s 400
Index and the Russell 3000 Index® and is headquartered in Stamford,
Conn. Additional information about United Rentals is available at unitedrentals.com.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and the Private Securities Litigation Reform Act of 1995, known
as the PSLRA. These statements can generally be identified by the use of
forward-looking terminology such as “believe,” “expect,” “may,” “will,”
“should,” “seek,” “on-track,” “plan,” “project,” “forecast,” “intend” or
“anticipate,” or the negative thereof or comparable terminology, or by
discussions of vision, strategy or outlook. These statements are based
on current plans, estimates and projections, and, therefore, you should
not place undue reliance on them. No forward-looking statement can be
guaranteed, and actual results may differ materially from those
projected. Factors that could cause actual results to differ materially
from those projected include, but are not limited to, the following: (1)
the challenges associated with past or future acquisitions, including
NES and Neff, such as undiscovered liabilities, costs, integration
issues and/or the inability to achieve the cost and revenue synergies
expected; (2) a slowdown in North American construction and industrial
activities, which occurred during the 2008-2010 economic downturn and
significantly affected our revenues and profitability, could reduce
demand for equipment and prices that we can charge; (3) our significant
indebtedness, which requires us to use a substantial portion of our cash
flow for debt service and can constrain our flexibility in responding to
unanticipated or adverse business conditions; (4) the inability to
refinance our indebtedness at terms that are favorable to us, or at all;
(5) the incurrence of additional debt, which could exacerbate the risks
associated with our current level of indebtedness; (6) noncompliance
with covenants in our debt agreements, which could result in termination
of our credit facilities and acceleration of outstanding borrowings; (7)
restrictive covenants and amount of borrowings permitted under our debt
agreements, which could limit our financial and operational flexibility;
(8) an overcapacity of fleet in the equipment rental industry; (9) a
decrease in levels of infrastructure spending, including lower than
expected government funding for construction projects; (10) fluctuations
in the price of our common stock and inability to complete stock
repurchases in the time frame and/or on the terms anticipated; (11) our
rates and time utilization being less than anticipated; (12) our
inability to manage credit risk adequately or to collect on contracts
with customers; (13) our inability to access the capital that our
business or growth plans may require; (14) the incurrence of impairment
charges; (15) trends in oil and natural gas could adversely affect
demand for our services and products; (16) our dependence on
distributions from subsidiaries as a result of our holding company
structure and the fact that such distributions could be limited by
contractual or legal restrictions; (17) an increase in our loss reserves
to address business operations or other claims and any claims that
exceed our established levels of reserves; (18) the incurrence of
additional costs and expenses (including indemnification obligations) in
connection with litigation, regulatory or investigatory matters; (19)
the outcome or other potential consequences of litigation and other
claims and regulatory matters relating to our business, including
certain claims that our insurance may not cover; (20) the effect that
certain provisions in our charter and certain debt agreements and our
significant indebtedness may have of making more difficult or otherwise
discouraging, delaying or deterring a takeover or other change of
control of us; (21) management turnover and inability to attract and
retain key personnel; (22) our costs being more than anticipated and/or
the inability to realize expected savings in the amounts or time frames
planned; (23) our dependence on key suppliers to obtain equipment and
other supplies for our business on acceptable terms; (24) our inability
to sell our new or used fleet in the amounts, or at the prices, we
expect; (25) competition from existing and new competitors; (26)
security breaches, cybersecurity attacks and other significant
disruptions in our information technology systems; (27) the costs of
complying with environmental, safety and foreign laws and regulations,
as well as other risks associated with non-U.S. operations, including
currency exchange risk; (28) labor difficulties and labor-based
legislation affecting our labor relations and operations generally; and
(29) increases in our maintenance and replacement costs and/or decreases
in the residual value of our equipment. For a more complete description
of these and other possible risks and uncertainties, please refer to our
Annual Report on Form 10-K for the year ended December 31, 2016, as well
as to our subsequent filings with the SEC. The forward-looking
statements contained herein speak only as of the date hereof, and we
make no commitment to update or publicly release any revisions to
forward-looking statements in order to reflect new information or
subsequent events, circumstances or changes in expectations.
|
|
|
UNITED RENTALS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (UNAUDITED)
(In millions, except
per share amounts)
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
Equipment rentals
|
|
|
$
|
1,536
|
|
|
$
|
1,322
|
|
|
$
|
4,069
|
|
|
$
|
3,643
|
|
|
Sales of rental equipment
|
|
|
139
|
|
|
112
|
|
|
378
|
|
|
361
|
|
|
Sales of new equipment
|
|
|
40
|
|
|
30
|
|
|
126
|
|
|
96
|
|
|
Contractor supplies sales
|
|
|
21
|
|
|
19
|
|
|
60
|
|
|
60
|
|
|
Service and other revenues
|
|
|
30
|
|
|
25
|
|
|
86
|
|
|
79
|
|
|
Total revenues
|
|
|
1,766
|
|
|
1,508
|
|
|
4,719
|
|
|
4,239
|
|
|
Cost of revenues:
|
|
|
|
|
|
|
|
|
|
|
Cost of equipment rentals, excluding depreciation
|
|
|
557
|
|
|
486
|
|
|
1,556
|
|
|
1,391
|
|
|
Depreciation of rental equipment
|
|
|
290
|
|
|
250
|
|
|
804
|
|
|
735
|
|
|
Cost of rental equipment sales
|
|
|
84
|
|
|
68
|
|
|
225
|
|
|
215
|
|
|
Cost of new equipment sales
|
|
|
34
|
|
|
25
|
|
|
108
|
|
|
79
|
|
|
Cost of contractor supplies sales
|
|
|
14
|
|
|
13
|
|
|
42
|
|
|
41
|
|
|
Cost of service and other revenues
|
|
|
14
|
|
|
10
|
|
|
42
|
|
|
32
|
|
|
Total cost of revenues
|
|
|
993
|
|
|
852
|
|
|
2,777
|
|
|
2,493
|
|
|
Gross profit
|
|
|
773
|
|
|
656
|
|
|
1,942
|
|
|
1,746
|
|
|
Selling, general and administrative expenses
|
|
|
237
|
|
|
179
|
|
|
648
|
|
|
533
|
|
|
Merger related costs
|
|
|
16
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
Restructuring charge
|
|
|
9
|
|
|
4
|
|
|
28
|
|
|
8
|
|
|
Non-rental depreciation and amortization
|
|
|
63
|
|
|
61
|
|
|
189
|
|
|
192
|
|
|
Operating income
|
|
|
448
|
|
|
412
|
|
|
1,045
|
|
|
1,013
|
|
|
Interest expense, net
|
|
|
131
|
|
|
110
|
|
|
338
|
|
|
349
|
|
|
Other income, net
|
|
|
(5
|
)
|
|
(1
|
)
|
|
(5
|
)
|
|
(3
|
)
|
|
Income before provision for income taxes
|
|
|
322
|
|
|
303
|
|
|
712
|
|
|
667
|
|
|
Provision for income taxes
|
|
|
123
|
|
|
116
|
|
|
263
|
|
|
254
|
|
|
Net income
|
|
|
$
|
199
|
|
|
$
|
187
|
|
|
$
|
449
|
|
|
$
|
413
|
|
|
Diluted earnings per share
|
|
|
$
|
2.33
|
|
|
$
|
2.16
|
|
|
$
|
5.26
|
|
|
$
|
4.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITED RENTALS, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS (UNAUDITED)
(In millions)
|
|
|
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
|
ASSETS
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
324
|
|
|
$
|
312
|
|
|
Accounts receivable, net
|
|
|
1,151
|
|
|
920
|
|
|
Inventory
|
|
|
82
|
|
|
68
|
|
|
Prepaid expenses and other assets
|
|
|
82
|
|
|
61
|
|
|
Total current assets
|
|
|
1,639
|
|
|
1,361
|
|
|
Rental equipment, net
|
|
|
7,391
|
|
|
6,189
|
|
|
Property and equipment, net
|
|
|
451
|
|
|
430
|
|
|
Goodwill
|
|
|
3,493
|
|
|
3,260
|
|
|
Other intangible assets, net
|
|
|
759
|
|
|
742
|
|
|
Other long-term assets
|
|
|
11
|
|
|
6
|
|
|
Total assets
|
|
|
$
|
13,744
|
|
|
$
|
11,988
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
Short-term debt and current maturities of long-term debt
|
|
|
$
|
694
|
|
|
$
|
597
|
|
|
Accounts payable
|
|
|
612
|
|
|
243
|
|
|
Accrued expenses and other liabilities
|
|
|
467
|
|
|
344
|
|
|
Total current liabilities
|
|
|
1,773
|
|
|
1,184
|
|
|
Long-term debt
|
|
|
7,677
|
|
|
7,193
|
|
|
Deferred taxes
|
|
|
2,012
|
|
|
1,896
|
|
|
Other long-term liabilities
|
|
|
71
|
|
|
67
|
|
|
Total liabilities
|
|
|
11,533
|
|
|
10,340
|
|
|
Common stock
|
|
|
1
|
|
|
1
|
|
|
Additional paid-in capital
|
|
|
2,322
|
|
|
2,288
|
|
|
Retained earnings
|
|
|
2,108
|
|
|
1,654
|
|
|
Treasury stock
|
|
|
(2,077
|
)
|
|
(2,077
|
)
|
|
Accumulated other comprehensive loss
|
|
|
(143
|
)
|
|
(218
|
)
|
|
Total stockholders’ equity
|
|
|
2,211
|
|
|
1,648
|
|
|
Total liabilities and stockholders’ equity
|
|
|
$
|
13,744
|
|
|
$
|
11,988
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITED RENTALS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED)
(In millions)
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Cash Flows From Operating Activities:
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
199
|
|
|
$
|
187
|
|
|
$
|
449
|
|
|
$
|
413
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
353
|
|
|
311
|
|
|
993
|
|
|
927
|
|
|
Amortization of deferred financing costs and original issue discounts
|
|
|
2
|
|
|
3
|
|
|
6
|
|
|
7
|
|
|
Gain on sales of rental equipment
|
|
|
(55
|
)
|
|
(44
|
)
|
|
(153
|
)
|
|
(146
|
)
|
|
Gain on sales of non-rental equipment
|
|
|
(1
|
)
|
|
(2
|
)
|
|
(4
|
)
|
|
(3
|
)
|
|
Stock compensation expense, net
|
|
|
24
|
|
|
11
|
|
|
64
|
|
|
33
|
|
|
Merger related costs
|
|
|
16
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
Restructuring charge
|
|
|
9
|
|
|
4
|
|
|
28
|
|
|
8
|
|
Loss on repurchase/redemption of debt securities and amendment of
ABL facility
|
|
|
31
|
|
|
10
|
|
|
43
|
|
|
36
|
|
|
Excess tax benefits from share-based payment arrangements (1)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(53
|
)
|
|
Increase in deferred taxes
|
|
|
57
|
|
|
21
|
|
|
97
|
|
|
90
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
(Increase) decrease in accounts receivable
|
|
|
(156
|
)
|
|
(61
|
)
|
|
(172
|
)
|
|
7
|
|
|
Increase in inventory
|
|
|
(4
|
)
|
|
(1
|
)
|
|
(9
|
)
|
|
(3
|
)
|
|
Decrease (increase) in prepaid expenses and other assets
|
|
|
6
|
|
|
11
|
|
|
(1
|
)
|
|
75
|
|
|
(Decrease) increase in accounts payable
|
|
|
(79
|
)
|
|
(200
|
)
|
|
350
|
|
|
137
|
|
|
Increase in accrued expenses and other liabilities
|
|
|
27
|
|
|
133
|
|
|
43
|
|
|
102
|
|
|
Net cash provided by operating activities
|
|
|
429
|
|
|
383
|
|
|
1,766
|
|
|
1,630
|
|
|
Cash Flows From Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
Purchases of rental equipment
|
|
|
(572
|
)
|
|
(423
|
)
|
|
(1,485
|
)
|
|
(1,145
|
)
|
|
Purchases of non-rental equipment
|
|
|
(32
|
)
|
|
(23
|
)
|
|
(87
|
)
|
|
(65
|
)
|
|
Proceeds from sales of rental equipment
|
|
|
139
|
|
|
112
|
|
|
378
|
|
|
361
|
|
|
Proceeds from sales of non-rental equipment
|
|
|
4
|
|
|
5
|
|
|
10
|
|
|
12
|
|
|
Purchases of other companies, net of cash acquired
|
|
|
(98
|
)
|
|
(14
|
)
|
|
(1,063
|
)
|
|
(28
|
)
|
|
Purchases of investments
|
|
|
(1
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
Net cash used in investing activities
|
|
|
(560
|
)
|
|
(343
|
)
|
|
(2,252
|
)
|
|
(865
|
)
|
|
Cash Flows From Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
Proceeds from debt
|
|
|
4,759
|
|
|
1,848
|
|
|
8,702
|
|
|
5,812
|
|
|
Payments of debt
|
|
|
(4,613
|
)
|
|
(1,701
|
)
|
|
(8,156
|
)
|
|
(6,021
|
)
|
|
Payments of financing costs
|
|
|
(37
|
)
|
|
—
|
|
|
(44
|
)
|
|
(12
|
)
|
|
Proceeds from the exercise of common stock options
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
Common stock repurchased (2)
|
|
|
(2
|
)
|
|
(152
|
)
|
|
(26
|
)
|
|
(488
|
)
|
|
Excess tax benefits from share-based payment arrangements (1)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
Net cash provided by (used in) financing activities
|
|
|
107
|
|
|
(5
|
)
|
|
477
|
|
|
(656
|
)
|
|
Effect of foreign exchange rates
|
|
|
10
|
|
|
(3
|
)
|
|
21
|
|
|
9
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
(14
|
)
|
|
32
|
|
|
12
|
|
|
118
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
338
|
|
|
265
|
|
|
312
|
|
|
179
|
|
|
Cash and cash equivalents at end of period
|
|
|
$
|
324
|
|
|
$
|
297
|
|
|
$
|
324
|
|
|
$
|
297
|
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|
Cash paid for income taxes, net
|
|
|
$
|
55
|
|
|
$
|
11
|
|
|
$
|
114
|
|
|
$
|
14
|
|
|
Cash paid for interest
|
|
|
128
|
|
|
75
|
|
|
305
|
|
|
294
|
|
|
(1)
|
|
In 2017, we adopted accounting guidance on share-based payments, as
a result of which the excess tax benefits from share-based payment
arrangements for 2017 are presented as a component of net cash
provided by operating activities (within net income), while, for
2016, they are presented as a component of net cash used in
financing activities.
|
|
|
|
|
|
UNITED RENTALS, INC.
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(continued)
|
|
|
|
(2)
|
|
The 2017 repurchases reflect shares withheld to satisfy tax
withholding obligations upon the vesting of restricted stock unit
awards, and were not acquired pursuant to any repurchase plan or
program. We have an open $1 billion share repurchase program, under
which we have purchased $627 million to date, that we paused as we
evaluated potential acquisition opportunities. We completed the NES
and Neff acquisitions in April 2017 and October 2017, respectively.
In October 2017, we resumed the share repurchase program, and we
intend to complete the program in 2018. The 2016 repurchases
included i) shares repurchased pursuant to the $1 billion share
repurchase program and ii) shares withheld to satisfy tax
withholding obligations upon the vesting of restricted stock unit
awards.
|
|
|
|
|
|
|
|
UNITED RENTALS, INC.
SEGMENT PERFORMANCE
($
in millions)
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
|
General Rentals
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reportable segment equipment rentals revenue
|
|
|
$1,237
|
|
$1,097
|
|
12.8%
|
|
$3,357
|
|
$3,067
|
|
9.5%
|
|
Reportable segment equipment rentals gross profit
|
|
|
525
|
|
469
|
|
11.9%
|
|
1,350
|
|
1,243
|
|
8.6%
|
|
Reportable segment equipment rentals gross margin
|
|
|
42.4%
|
|
42.8%
|
|
(40) bps
|
|
40.2%
|
|
40.5%
|
|
(30) bps
|
|
Trench, Power and Pump
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reportable segment equipment rentals revenue
|
|
|
$299
|
|
$225
|
|
32.9%
|
|
$712
|
|
$576
|
|
23.6%
|
|
Reportable segment equipment rentals gross profit
|
|
|
164
|
|
117
|
|
40.2%
|
|
359
|
|
274
|
|
31.0%
|
|
Reportable segment equipment rentals gross margin
|
|
|
54.8%
|
|
52.0%
|
|
280 bps
|
|
50.4%
|
|
47.6%
|
|
280 bps
|
|
Total United Rentals
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equipment rentals revenue
|
|
|
$1,536
|
|
$1,322
|
|
16.2%
|
|
$4,069
|
|
$3,643
|
|
11.7%
|
|
Total equipment rentals gross profit
|
|
|
689
|
|
586
|
|
17.6%
|
|
1,709
|
|
1,517
|
|
12.7%
|
|
Total equipment rentals gross margin
|
|
|
44.9%
|
|
44.3%
|
|
60 bps
|
|
42.0%
|
|
41.6%
|
|
40 bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITED RENTALS, INC.
DILUTED EARNINGS PER SHARE
CALCULATION
(In millions, except per share data)
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Numerator:
|
|
|
|
|
|
|
|
|
|
|
Net income available to common stockholders
|
|
|
$
|
199
|
|
|
$
|
187
|
|
|
$
|
449
|
|
|
$
|
413
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
Denominator for basic earnings per share—weighted-average common
shares
|
|
|
84.7
|
|
|
85.9
|
|
|
84.6
|
|
|
88.2
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
Employee stock options
|
|
|
0.4
|
|
|
0.3
|
|
|
0.4
|
|
|
0.3
|
|
Restricted stock units
|
|
|
0.5
|
|
|
0.2
|
|
|
0.5
|
|
|
0.1
|
Denominator for diluted earnings per share—adjusted
weighted-average common shares
|
|
|
85.6
|
|
|
86.4
|
|
|
85.5
|
|
|
88.6
|
|
Diluted earnings per share
|
|
|
$
|
2.33
|
|
|
$
|
2.16
|
|
|
$
|
5.26
|
|
|
$
|
4.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITED RENTALS, INC.
|
|
ADJUSTED EARNINGS PER SHARE GAAP RECONCILIATION
|
|
|
We define “earnings per share – adjusted” as the sum of earnings per
share – GAAP, as reported plus the impact of the following special
items: merger related costs, merger related intangible asset
amortization, impact on depreciation related to acquired RSC and NES
fleet and property and equipment, impact of the fair value mark-up of
acquired RSC and NES fleet, impact on interest expense related to fair
value adjustment of acquired RSC indebtedness, restructuring charge,
asset impairment charge and loss on repurchase/redemption of debt
securities and amendment of ABL facility. Management believes that
earnings per share - adjusted provides useful information concerning
future profitability. However, earnings per share - adjusted is not a
measure of financial performance under GAAP. Accordingly, earnings per
share - adjusted should not be considered an alternative to GAAP
earnings per share. The table below provides a reconciliation between
earnings per share – GAAP, as reported, and earnings per share –
adjusted.
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Earnings per share - GAAP, as reported
|
|
|
$
|
2.33
|
|
|
$
|
2.16
|
|
|
$
|
5.26
|
|
|
$
|
4.66
|
|
|
After-tax impact of:
|
|
|
|
|
|
|
|
|
|
|
Merger related costs (1)
|
|
|
0.12
|
|
|
—
|
|
|
0.23
|
|
|
—
|
|
|
Merger related intangible asset amortization (2)
|
|
|
0.27
|
|
|
0.28
|
|
|
0.83
|
|
|
0.85
|
|
Impact on depreciation related to acquired RSC and NES fleet and
property and equipment (3)
|
|
|
0.07
|
|
|
—
|
|
|
0.05
|
|
|
—
|
|
|
Impact of the fair value mark-up of acquired RSC and NES fleet (4)
|
|
|
0.17
|
|
|
0.05
|
|
|
0.36
|
|
|
0.18
|
|
Impact on interest expense related to fair value adjustment of
acquired RSC indebtedness (5)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
|
Restructuring charge (6)
|
|
|
0.07
|
|
|
0.02
|
|
|
0.21
|
|
|
0.05
|
|
|
Asset impairment charge (7)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.02
|
|
Loss on repurchase/redemption of debt securities and amendment of
ABL facility
|
|
|
0.22
|
|
|
0.07
|
|
|
0.31
|
|
|
0.25
|
|
|
Earnings per share - adjusted
|
|
|
$
|
3.25
|
|
|
$
|
2.58
|
|
|
$
|
7.25
|
|
|
$
|
6.00
|
|
|
Tax rate applied to above adjustments (8)
|
|
|
38.5
|
%
|
|
38.6
|
%
|
|
38.5
|
%
|
|
38.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Reflects transaction costs associated with the NES and Neff
acquisitions discussed above. We have made a number of acquisitions
in the past and may continue to make acquisitions in the future.
Merger related costs only include costs associated with major
acquisitions that significantly impact our operations. The historic
acquisitions that have included merger related costs are RSC, which
had annual revenues of approximately $1.5 billion prior to the
acquisition, and National Pump, which had annual revenues of over
$200 million prior to the acquisition. NES had annual revenues of
approximately $369 million, and Neff had annual revenues of
approximately $413 million.
|
|
(2)
|
|
Reflects the amortization of the intangible assets acquired in the
RSC, National Pump and NES acquisitions.
|
|
(3)
|
|
Reflects the impact of extending the useful lives of equipment
acquired in the RSC and NES acquisitions, net of the impact of
additional depreciation associated with the fair value mark-up of
such equipment.
|
|
(4)
|
|
Reflects additional costs recorded in cost of rental equipment sales
associated with the fair value mark-up of rental equipment acquired
in the RSC and NES acquisitions and subsequently sold.
|
|
(5)
|
|
Reflects a reduction of interest expense associated with the fair
value mark-up of debt acquired in the RSC acquisition.
|
|
(6)
|
|
Primarily reflects severance and branch closure charges associated
with our closed restructuring programs and our current restructuring
program. We only include such costs that are part of a restructuring
program as restructuring charges. Since the first such restructuring
program was initiated in 2008, we have completed three restructuring
programs. We have cumulatively incurred total restructuring charges
of $262 million under our restructuring programs.
|
|
(7)
|
|
Reflects write-offs of fixed assets in connection with our
restructuring programs.
|
|
(8)
|
|
The tax rates applied to the adjustments reflect the statutory rates
in the applicable entity.
|
|
|
|
|
|
UNITED RENTALS, INC.
|
|
EBITDA AND ADJUSTED EBITDA GAAP RECONCILIATIONS
|
|
(In millions)
|
|
|
EBITDA represents the sum of net income, provision for income taxes,
interest expense, net, depreciation of rental equipment, and non-rental
depreciation and amortization. Adjusted EBITDA represents EBITDA plus
the sum of the merger related costs, restructuring charge, stock
compensation expense, net, and the impact of the fair value mark-up of
acquired RSC and NES fleet. These items are excluded from adjusted
EBITDA internally when evaluating our operating performance and for
strategic planning and forecasting purposes, and allow investors to make
a more meaningful comparison between our core business operating results
over different periods of time, as well as with those of other similar
companies. The EBITDA and adjusted EBITDA margins represent EBITDA or
adjusted EBITDA divided by total revenue. Management believes that
EBITDA and adjusted EBITDA, when viewed with the Company’s results under
GAAP and the accompanying reconciliation, provide useful information
about operating performance and period-over-period growth, and provide
additional information that is useful for evaluating the operating
performance of our core business without regard to potential
distortions. Additionally, management believes that EBITDA and adjusted
EBITDA help investors gain an understanding of the factors and trends
affecting our ongoing cash earnings, from which capital investments are
made and debt is serviced.
The table below provides a reconciliation between net income and EBITDA
and adjusted EBITDA.
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net income
|
|
|
$
|
199
|
|
|
$
|
187
|
|
|
$
|
449
|
|
|
$
|
413
|
|
Provision for income taxes
|
|
|
123
|
|
|
116
|
|
|
263
|
|
|
254
|
|
Interest expense, net
|
|
|
131
|
|
|
110
|
|
|
338
|
|
|
349
|
|
Depreciation of rental equipment
|
|
|
290
|
|
|
250
|
|
|
804
|
|
|
735
|
|
Non-rental depreciation and amortization
|
|
|
63
|
|
|
61
|
|
|
189
|
|
|
192
|
|
EBITDA (A)
|
|
|
$
|
806
|
|
|
$
|
724
|
|
|
$
|
2,043
|
|
|
$
|
1,943
|
|
Merger related costs (1)
|
|
|
16
|
|
|
—
|
|
|
32
|
|
|
—
|
|
Restructuring charge (2)
|
|
|
9
|
|
|
4
|
|
|
28
|
|
|
8
|
|
Stock compensation expense, net (3)
|
|
|
24
|
|
|
11
|
|
|
64
|
|
|
33
|
|
Impact of the fair value mark-up of acquired RSC and NES fleet (4)
|
|
|
24
|
|
|
8
|
|
|
50
|
|
|
26
|
|
Adjusted EBITDA (B)
|
|
|
$
|
879
|
|
|
$
|
747
|
|
|
$
|
2,217
|
|
|
$
|
2,010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A) Our EBITDA margin was 45.6% and 48.0% for the three months ended
September 30, 2017 and 2016, respectively, and 43.3% and 45.8% for
the nine months ended September 30, 2017 and 2016, respectively.
|
B) Our adjusted EBITDA margin was 49.8% and 49.5% for the three
months ended September 30, 2017 and 2016, respectively, and 47.0%
and 47.4% for the nine months ended September 30, 2017 and 2016,
respectively.
|
|
|
|
(1)
|
|
Reflects transaction costs associated with the NES and Neff
acquisitions discussed above. We have made a number of acquisitions
in the past and may continue to make acquisitions in the future.
Merger related costs only include costs associated with major
acquisitions that significantly impact our operations. The historic
acquisitions that have included merger related costs are RSC, which
had annual revenues of approximately $1.5 billion prior to the
acquisition, and National Pump, which had annual revenues of over
$200 million prior to the acquisition. NES had annual revenues of
approximately $369 million, and Neff had annual revenues of
approximately $413 million.
|
|
(2)
|
|
Primarily reflects severance and branch closure charges associated
with our closed restructuring programs and our current restructuring
program. We only include such costs that are part of a restructuring
program as restructuring charges. Since the first such restructuring
program was initiated in 2008, we have completed three restructuring
programs. We have cumulatively incurred total restructuring charges
of $262 million under our restructuring programs.
|
|
(3)
|
|
Represents non-cash, share-based payments associated with the
granting of equity instruments.
|
|
(4)
|
|
Reflects additional costs recorded in cost of rental equipment sales
associated with the fair value mark-up of rental equipment acquired
in the RSC and NES acquisitions and subsequently sold.
|
|
|
|
|
|
UNITED RENTALS, INC.
|
|
EBITDA AND ADJUSTED EBITDA GAAP RECONCILIATIONS (continued)
|
|
(In millions)
|
|
|
The table below provides a reconciliation between net cash provided by
operating activities and EBITDA and adjusted EBITDA.
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net cash provided by operating activities
|
|
|
$
|
429
|
|
|
$
|
383
|
|
|
$
|
1,766
|
|
|
$
|
1,630
|
|
|
Adjustments for items included in net cash provided by operating
activities
but excluded from the calculation of EBITDA:
|
|
|
|
|
|
|
|
|
|
|
Amortization of deferred financing costs and original issue discounts
|
|
|
(2
|
)
|
|
(3
|
)
|
|
(6
|
)
|
|
(7
|
)
|
|
Gain on sales of rental equipment
|
|
|
55
|
|
|
44
|
|
|
153
|
|
|
146
|
|
|
Gain on sales of non-rental equipment
|
|
|
1
|
|
|
2
|
|
|
4
|
|
|
3
|
|
|
Merger related costs (1)
|
|
|
(16
|
)
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
|
Restructuring charge (2)
|
|
|
(9
|
)
|
|
(4
|
)
|
|
(28
|
)
|
|
(8
|
)
|
|
Stock compensation expense, net (3)
|
|
|
(24
|
)
|
|
(11
|
)
|
|
(64
|
)
|
|
(33
|
)
|
Loss on repurchase/redemption of debt securities and amendment of
ABL facility
|
|
|
(31
|
)
|
|
(10
|
)
|
|
(43
|
)
|
|
(36
|
)
|
|
Excess tax benefits from share-based payment arrangements
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
Changes in assets and liabilities
|
|
|
220
|
|
|
237
|
|
|
(126
|
)
|
|
(113
|
)
|
|
Cash paid for interest
|
|
|
128
|
|
|
75
|
|
|
305
|
|
|
294
|
|
|
Cash paid for income taxes, net
|
|
|
55
|
|
|
11
|
|
|
114
|
|
|
14
|
|
|
EBITDA
|
|
|
$
|
806
|
|
|
$
|
724
|
|
|
$
|
2,043
|
|
|
$
|
1,943
|
|
|
Add back:
|
|
|
|
|
|
|
|
|
|
|
Merger related costs (1)
|
|
|
16
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
Restructuring charge (2)
|
|
|
9
|
|
|
4
|
|
|
28
|
|
|
8
|
|
|
Stock compensation expense, net (3)
|
|
|
24
|
|
|
11
|
|
|
64
|
|
|
33
|
|
|
Impact of the fair value mark-up of acquired RSC and NES fleet (4)
|
|
|
24
|
|
|
8
|
|
|
50
|
|
|
26
|
|
|
Adjusted EBITDA
|
|
|
$
|
879
|
|
|
$
|
747
|
|
|
$
|
2,217
|
|
|
$
|
2,010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Reflects transaction costs associated with the NES and Neff
acquisitions discussed above. We have made a number of acquisitions
in the past and may continue to make acquisitions in the future.
Merger related costs only include costs associated with major
acquisitions that significantly impact our operations. The historic
acquisitions that have included merger related costs are RSC, which
had annual revenues of approximately $1.5 billion prior to the
acquisition, and National Pump, which had annual revenues of over
$200 million prior to the acquisition. NES had annual revenues of
approximately $369 million, and Neff had annual revenues of
approximately $413 million.
|
|
(2)
|
|
Primarily reflects severance and branch closure charges associated
with our closed restructuring programs and our current restructuring
program. We only include such costs that are part of a restructuring
program as restructuring charges. Since the first such restructuring
program was initiated in 2008, we have completed three restructuring
programs. We have cumulatively incurred total restructuring charges
of $262 million under our restructuring programs.
|
|
(3)
|
|
Represents non-cash, share-based payments associated with the
granting of equity instruments.
|
|
(4)
|
|
Reflects additional costs recorded in cost of rental equipment sales
associated with the fair value mark-up of rental equipment acquired
in the RSC and NES acquisitions and subsequently sold.
|
|
|
|
|
|
UNITED RENTALS, INC.
|
|
FREE CASH FLOW GAAP RECONCILIATION
|
|
(In millions)
|
|
|
We define free cash flow as (i) net cash provided by operating
activities less (ii) purchases of rental and non-rental equipment plus
(iii) proceeds from sales of rental and non-rental equipment and excess
tax benefits from share-based payment arrangements. Management believes
that free cash flow provides useful additional information concerning
cash flow available to meet future debt service obligations and working
capital requirements. However, free cash flow is not a measure of
financial performance or liquidity under GAAP. Accordingly, free cash
flow should not be considered an alternative to net income or cash flow
from operating activities as an indicator of operating performance or
liquidity. The table below provides a reconciliation between net cash
provided by operating activities and free cash flow.
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net cash provided by operating activities
|
|
|
$
|
429
|
|
|
$
|
383
|
|
|
$
|
1,766
|
|
|
$
|
1,630
|
|
|
Purchases of rental equipment
|
|
|
(572
|
)
|
|
(423
|
)
|
|
(1,485
|
)
|
|
(1,145
|
)
|
|
Purchases of non-rental equipment
|
|
|
(32
|
)
|
|
(23
|
)
|
|
(87
|
)
|
|
(65
|
)
|
|
Proceeds from sales of rental equipment
|
|
|
139
|
|
|
112
|
|
|
378
|
|
|
361
|
|
|
Proceeds from sales of non-rental equipment
|
|
|
4
|
|
|
5
|
|
|
10
|
|
|
12
|
|
|
Excess tax benefits from share-based payment arrangements (1)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
Free cash flow (2)
|
|
|
$
|
(32
|
)
|
|
$
|
54
|
|
|
$
|
582
|
|
|
$
|
846
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
The excess tax benefits from share-based payment arrangements result
from stock-based compensation windfall deductions in excess of the
amounts reported for financial reporting purposes. We adopted
accounting guidance in 2017 that changed the cash flow presentation
of excess tax benefits from share-based payment arrangements. In the
table above, the excess tax benefits from share-based payment
arrangements for 2017 are presented as a component of net cash
provided by operating activities, while, for 2016, they are
presented as a separate line item. Because we historically included
the excess tax benefits from share-based payment arrangements in the
free cash flow calculation, the adoption of this guidance did not
change the calculation of free cash flow.
|
|
(2)
|
|
Free cash flow included aggregate merger and restructuring related
payments of $21 million and $5 million for the three months ended
September 30, 2017 and 2016, respectively, and $52 million and $11
million for the nine months ended September 30, 2017 and 2016,
respectively.
|
|
|
|
|
The table below provides a reconciliation between 2017 forecasted net
cash provided by operating activities and free cash flow.
|
Net cash provided by operating activities
|
|
|
|
$2,275- $2,375
|
|
Purchases of rental equipment
|
|
|
|
$(1,750)-$(1,800)
|
|
Proceeds from sales of rental equipment
|
|
|
|
$475-$525
|
|
Purchases of non-rental equipment, net of proceeds from sales
|
|
|
|
$(75)-$(125)
|
Free cash flow (excluding the impact of merger and restructuring
related costs)
|
|
|
|
$925- $975
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20171018006443/en/
Copyright Business Wire 2017
Source: Business Wire
(October 18, 2017 - 4:15 PM EDT)
News by QuoteMedia
www.quotemedia.com |
