WillScot Reports Third Quarter 2024 Results
Outstanding Margin and Cash Flow Performance Continues -
Focus Turns to Growth in 2025
PHOENIX, Oct. 30, 2024 (GLOBE NEWSWIRE) -- WillScot
Holdings Corporation (“WillScot” or the “Company”) (Nasdaq: WSC), a
leader in innovative temporary flexible space solutions, today
announced third quarter 2024 results including key performance
highlights and market updates.
- Generated revenue of $601 million,
loss from continuing operations of $70 million and diluted
loss per share of $0.37, including the $180 million McGrath
RentCorp merger agreement termination fee ("termination fee").
- Adjusted income from continuing
operations excluding the termination fee, restructuring, and
transaction-related charges was $72 million and Adjusted Diluted
Earnings Per Share was $0.38
- Delivered Adjusted EBITDA of $267
million, up 1%, with Adjusted EBITDA Margin expanding sequentially
to 44.4% and up 50 basis points year-over-year.
- Generated Adjusted Free Cash Flow of
$143 million at a 24% margin.
- Maintained leverage within our
stated 3.0x to 3.5x range at 3.4x Net Debt to Adjusted EBITDA as of
September 30, 2024.
- Generated 17% Return on Invested
Capital2 ("ROIC") over the last 12 months.
- Returned $276 million to
shareholders by repurchasing 7.1 million shares of Common Stock,
reducing our share count by 3.3% over the twelve months ended
September 30, 20241.
- Updated FY 2024 Adjusted EBITDA
outlook range to $1,050 million to $1,070 million.
Brad Soultz, Chief Executive Officer of WillScot,
commented, “Our team continued to execute well in Q3, delivering
record third quarter Adjusted EBITDA Margins, with Adjusted Free
Cash Flow and Return on Invested Capital also near record
levels. Headwinds in non-residential construction
impacted top-line revenue, particularly among smaller scale and
rate sensitive customers. In contrast, we continue to see steady
demand across larger projects and strong backlogs among our
national accounts and general contractors. And we anticipate that
the overall operating environment will only benefit from interest
rate and political certainty. These indicators, combined with our
recent investments in our commercial and operations platform and
accelerating run-rates in our newer product categories, give us
confidence in our growth prospects for 2025."
Soultz continued, “As non-residential construction
starts activity continues to bottom, we’ve diligently invested in
and executed significant commercial and operational improvements,
beginning with the combination of the legacy modular and storage
field sales and operations teams in January, our final major
systems integration in March, consolidation under the WillScot
brand in July, and the introduction of powerful new digital and
commercial capabilities. These improvements are in place across our
network, which allow us to leverage our scale to go to market as a
single organization, and we believe that they represent significant
points of operating leverage heading into 2025. In parallel, we are
accelerating development of enterprise accounts and new verticals,
which are under-penetrated and areas where our positioning as the
only pure-play turnkey temporary space specialists resonates most
powerfully. Finally, we continue to expand into adjacent solutions
through a balanced combination of organic growth, acquisitions, and
innovation. And while those contributions were modest in 2024,
their run-rate doubled through the course of the year and we expect
that they can double again in 2025, giving us new levers with which
to grow the business.”
Soultz concluded, “With our longer-term milestones
very much in focus, we will continue to execute our disciplined
approach to capital allocation, which has returned over $2.1
billion of capital to our shareholders and reduced our economic
share count by 21% since 2021. Organic capital expenditures will
continue to be demand-driven, starting with growing Value-Added
Products, refurbishing our modular fleet using our unparalleled
in-house capabilities, and lastly, adding new fleet, particularly
in our FLEX product and new adjacent solutions which have potential
for accelerated nearer term growth. And as we reprime the M&A
pipeline heading into 2025, I expect that we execute a steady
cadence of tuck-in acquisitions in both our core and adjacent
markets. Together, this is a formula that will deliver consistent
compound returns over time, and I’m confident in and grateful to
the team for their execution.”
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands, except share data) |
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Revenue |
$ |
601,432 |
|
|
$ |
604,834 |
|
|
$ |
1,793,203 |
|
|
$ |
1,752,391 |
|
|
(Loss) income from continuing operations |
$ |
(70,475 |
) |
|
$ |
91,516 |
|
|
$ |
(61,086 |
) |
|
$ |
255,516 |
|
|
Adjusted income from continuing operations2 |
$ |
72,252 |
|
|
$ |
93,232 |
|
|
$ |
215,308 |
|
|
$ |
262,121 |
|
|
Adjusted EBITDA from continuing operations2 |
$ |
266,863 |
|
|
$ |
265,480 |
|
|
$ |
778,448 |
|
|
$ |
773,663 |
|
|
Gross profit margin from continuing operations |
|
53.5 |
% |
|
|
56.2 |
% |
|
|
53.8 |
% |
|
|
56.5 |
% |
|
Adjusted EBITDA Margin from continuing operations
(%)2 |
|
44.4 |
% |
|
|
43.9 |
% |
|
|
43.4 |
% |
|
|
44.1 |
% |
|
Net cash (used in) provided by operating activities |
$ |
(1,562 |
) |
|
$ |
190,998 |
|
|
$ |
382,725 |
|
|
$ |
541,918 |
|
|
Adjusted Free Cash Flow2,5 |
$ |
143,144 |
|
|
$ |
147,768 |
|
|
$ |
417,107 |
|
|
$ |
410,309 |
|
|
Diluted (loss) earnings per share from continuing operations |
$ |
(0.37 |
) |
|
$ |
0.46 |
|
|
$ |
(0.32 |
) |
|
$ |
1.25 |
|
|
Adjusted diluted earnings per share from continuing
operations2 |
$ |
0.38 |
|
|
$ |
0.47 |
|
|
$ |
1.12 |
|
|
$ |
1.28 |
|
|
Weighted average diluted shares outstanding |
|
188,281,346 |
|
|
|
199,258,304 |
|
|
|
189,362,364 |
|
|
|
204,461,042 |
|
|
Adjusted weighted average diluted shares
outstanding2 |
|
190,181,020 |
|
|
|
199,258,304 |
|
|
|
191,662,791 |
|
|
|
204,461,042 |
|
|
Net cash (used in) provided by operating activities margin |
(0.3) % |
|
|
31.6 |
% |
|
|
21.3 |
% |
|
|
30.8 |
% |
|
Adjusted Free Cash Flow Margin (%)2,5 |
|
23.8 |
% |
|
|
24.4 |
% |
|
|
23.3 |
% |
|
|
23.3 |
% |
|
Return on Invested Capital2 |
|
16.5 |
% |
|
|
17.6 |
% |
|
|
16.0 |
% |
|
|
17.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter
2024
Results2
Tim Boswell, President and Chief Financial Officer
of WillScot, commented, “Revenue for Q3 2024 was $601 million, and
Adjusted EBITDA increased 1% year-over-year to $267 million. The
sequential progression of revenue from Q2 into Q3 was weaker than
we forecasted, primarily driven by softer volumes, as
non-residential construction indicators continued to contract.
Pricing and Value-Added Products continue to improve across all
product categories, with average monthly rates in modular growing
2% sequentially and up 6% year-over-year and storage growing 1%
sequentially and 9% year-over-year. So volumes continue to be the
biggest headwind, although that headwind is moderating entering
2025, and we’ve introduced numerous capabilities in 2024 focused on
improving our commercial execution in this area.”
Boswell continued, “Given the operating
environment, we reduced variable costs by over $20 million relative
to our forecast for the quarter, on top of the approximately $40
million of annualized cost takeout that we executed in Q2.
Together, these reductions drove Adjusted EBITDA margin up
approximately 50 basis points year-over-year and up approximately
80 basis points sequentially from Q2 to 44.4%. And, excluding costs
related to the McGrath termination, we generated $143 million of
Adjusted Free Cash Flow in the quarter at a 24% Adjusted Free Cash
Flow Margin, so cash flow visibility remains an incredible strength
of our business, and we remain on track towards our longer-term
$700 million Free Cash Flow target.”
Boswell concluded, “We are reducing our outlook to
a midpoint of $1,060 million of Adjusted EBITDA for 2024,
reflecting the reality that non-residential construction markets
are bottoming later than assumed in our prior outlook. While that
is longer and deeper than we expected, volume headwinds continue to
moderate. And we think the combination of that moderation,
improving commercial execution, and growing run-rates in newer
product lines supports modest organic top-line growth with
continued margin expansion in 2025, progressing towards our
longer-term targets for Free Cash Flow and Return on Invested
Capital. Based on that outlook, we restarted our share repurchase
program following the McGrath termination, returning $62 million to
our shareholders by repurchasing 1.6 million shares during the
quarter. Consistent execution has been the foundation of our long
track record of growth and value creation, and we remain on track
and committed to our longer-term milestone of $4 of Free Cash Flow
per share.”
Capitalization and Liquidity
Update2
As of and for the three months ended September
30, 2024, except where noted:
- Net cash used in
operating activities was $1.6 million. Excluding one-time,
nonrecurring payments for the McGrath termination fee and
transaction costs from terminated acquisitions of $180 million and
$23 million, respectively, the Company generated $143 million of
Adjusted Free Cash Flow, down 3% year over year.
- Invested $59
million of net capital expenditures in the quarter, up 35% year
over year, primarily supporting growth in new product lines.
- Invested
$13 million of capital in one acquisition during the quarter,
with $161 million invested in the last 12 months.
- Maintained
availability under our asset backed revolving credit facility to
approximately $1.7 billion.
- Weighted average
pre-tax interest rate, inclusive of $1.25 billion of
fixed-to-floating swaps at 3.55%, was approximately 5.8%. Annual
cash interest expense based on the current debt structure and
benchmark rates is approximately $214 million, or approximately
$230 million inclusive of non-cash deferred financing fees. Our
debt structure is approximately 89% / 11% fixed-to-floating after
giving effect to all interest rate swaps.
- No debt
maturities prior to June 15, 2025. We have ample liquidity
available to redeem or refinance our $527 million 2025 notes,
using either our asset backed revolver or other sources of capital,
and intend to do so opportunistically prior to maturity in a manner
that optimizes our interest costs. Our next debt maturity is in
2027.
- Leverage is at
3.4x based on our last 12 months Adjusted EBITDA from continuing
operations of $1,066 million, which is inside our target range of
3.0x to 3.5x.
- Repurchased 1.6
million shares of Common Stock for $62 million in the third quarter
2024, contributing to a 3.3% reduction in our share count over the
12 months ending September 30, 2024.
2024 Outlook 2, 3,
4
This guidance is subject to risks and
uncertainties, including those described in "Forward-Looking
Statements" below.
|
$M |
2023 Results
From Continuing Operations |
2024 Outlook |
|
Revenue |
$2,365 |
$2,380 - $2,420 |
|
Adjusted EBITDA2,3 |
$1,061 |
$1,050 - $1,070 |
|
Net CAPEX3,4 |
$185 |
$250 - $280 |
|
|
1 - Assumes common shares outstanding as
of September 30, 2024 versus common shares
outstanding as of September 30, 2023.
2 - Adjusted EBITDA from continuing operations, Adjusted EBITDA
Margin from continuing operations, Adjusted income from continuing
operations, Adjusted Diluted Earnings Per Share, Adjusted Weighted
Average Diluted Shares Outstanding, Free Cash Flow, Free Cash Flow
Margin, Adjusted Free Cash Flow, Adjusted Free Cash Flow Margin,
Net Debt to Adjusted EBITDA, and Return on Invested
Capital are non-GAAP financial measures. Further information and
reconciliations for these non-GAAP measures to the most directly
comparable financial measure under generally accepted accounting
principles in the US ("GAAP") are included at the end of this press
release.
3 - Information reconciling forward-looking Adjusted EBITDA,
Net CAPEX, and Free Cash Flow to GAAP financial measures is
unavailable to the Company without unreasonable effort and
therefore neither the most comparable GAAP measures nor
reconciliations to the most comparable GAAP measures are
provided.
4 - Net CAPEX is a non-GAAP financial measure. Please see the
non-GAAP reconciliation tables included at the end of this press
release.
5 - Free Cash Flow incorporates results from discontinued
operations. For comparability, we add back discontinued operations
to reported revenue to calculate Free Cash Flow Margin.
Non-GAAP Financial Measures
This press release includes non-GAAP financial
measures, including Adjusted EBITDA, Adjusted EBITDA Margin from
continuing operations, Adjusted income from continuing operations,
Adjusted diluted earnings per share, Adjusted Weighted Average
Diluted Shares Outstanding, Free Cash Flow, Adjusted Free Cash
Flow, Free Cash Flow Margin, Adjusted Free Cash Flow Margin, Return
on Invested Capital, Net CAPEX, and Net Debt to Adjusted EBITDA
ratio. Adjusted EBITDA is defined as net income plus net interest
(income) expense, income tax expense (benefit), depreciation and
amortization adjusted to exclude certain non-cash items and the
effect of what we consider transactions or events not related to
our core business operations, including net currency gains and
losses, goodwill and other impairment charges, restructuring costs,
costs to integrate acquired companies, costs incurred related to
transactions, and other discrete expenses. Adjusted EBITDA Margin
from continuing operations is defined as Adjusted EBITDA divided by
revenue. Adjusted income from continuing operations is defined as
income from continuing operations plus certain non-cash items and
the effect of what we consider transactions or events not related
to our core business operations, including goodwill and other
impairment charges, restructuring costs, costs to integrate
acquired companies, costs incurred related to transactions, and
other discrete expenses. Adjusted diluted earnings per share is
defined as adjusted income from continuing operations divided by
Adjusted diluted weighted average common shares outstanding. The
calculation of Adjusted Weighted Average Diluted Shares Outstanding
includes shares related to stock awards that are dilutive for
Adjusted diluted earnings per share. Free Cash Flow is defined as
net cash provided by operating activities, less purchases of, and
proceeds from the sale of, rental equipment and property, plant and
equipment, which are all included in cash flows from investing
activities. Adjusted Free Cash Flow is defined as Free Cash Flow
excluding one-time, nonrecurring payments for the McGrath
termination fee and transaction costs from terminated acquisitions.
Free Cash Flow Margin is defined as Free Cash Flow divided by
revenue. Adjusted Free Cash Flow Margin is defined as Adjusted Free
Cash Flow divided by revenue. Return on Invested Capital is defined
as adjusted earnings before interest and amortization divided by
average invested capital. Adjusted earnings before interest and
amortization is defined as Adjusted EBITDA (see definition above)
reduced by depreciation and estimated statutory taxes. Given we are
not a significant US taxpayer due to our current tax attributes, we
include estimated taxes at our current statutory tax rate of
approximately 26%. Average invested capital is calculated as an
average of net assets. Net assets is defined as total assets less
goodwill, intangible assets, net and all non-interest bearing
liabilities. Net CAPEX is defined as purchases of rental equipment
and refurbishments and purchases of property, plant and equipment
(collectively, "Total Capital Expenditures"), less proceeds from
the sale of rental equipment and proceeds from the sale of
property, plant and equipment (collectively, "Total Proceeds"),
which are all included in cash flows from investing activities. Net
Debt to Adjusted EBITDA ratio is defined as Net Debt divided by
Adjusted EBITDA. The Company believes that Adjusted EBITDA and
Adjusted EBITDA margin are useful to investors because they (i)
allow investors to compare performance over various reporting
periods on a consistent basis by removing from operating results
the impact of items that do not reflect core operating performance;
(ii) are used by our board of directors and management to assess
our performance; (iii) may, subject to the limitations described
below, enable investors to compare the performance of the Company
to its competitors; (iv) provide additional tools for investors to
use in evaluating ongoing operating results and trends; and (v)
align with definitions in our credit agreement. The Company
believes that Free Cash Flow and Free Cash Flow Margin are useful
to investors because they allow investors to compare cash
generation performance over various reporting periods and against
peers. The Company believes that Return on Invested Capital
provides information about the long-term health and profitability
of the business relative to the Company's cost of capital. The
Company believes that the presentation of Net CAPEX provides useful
information to investors regarding the net capital invested into
our rental fleet and plant, property and equipment each year to
assist in analyzing the performance of our business. The Company
believes that the presentation of Net Debt to Adjusted EBITDA,
Adjusted income from continuing operations and Adjusted Diluted
Earnings Per Share provide useful information to investors
regarding the performance of our business. 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. These non-GAAP measures should
not be considered in isolation from, or as an alternative to,
financial measures determined in accordance with GAAP. Other
companies may calculate Adjusted EBITDA and other non-GAAP
financial measures differently, and therefore the Company's
non-GAAP financial measures may not be directly comparable to
similarly-titled measures of other companies. For reconciliations
of the non-GAAP measures used in this press release (except as
explained below), see “Reconciliation of Non-GAAP Financial
Measures" included in this press release.
Information regarding the most comparable GAAP
financial measures and reconciling forward-looking Adjusted EBITDA,
Net CAPEX, and Free Cash Flow to those GAAP financial measures is
unavailable to the Company without unreasonable effort. We cannot
provide the most comparable GAAP financial measures nor
reconciliations of forward-looking Adjusted EBITDA, Net CAPEX, and
Free Cash Flow to GAAP financial measures because certain items
required for such reconciliations are outside of our 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. Although we provide ranges of Adjusted
EBITDA and Net CAPEX that we believe will be achieved, we cannot
accurately predict all the components of the Adjusted EBITDA and
Net CAPEX calculations. The Company provides Adjusted EBITDA and
Net CAPEX guidance because we believe that Adjusted EBITDA and Net
CAPEX, when viewed with our results under GAAP, provides useful
information for the reasons noted above.
Conference Call Information
WillScot will host a conference call and webcast
to discuss its third quarter 2024 results and 2024 outlook at 5:30
p.m. Eastern Time on Thursday, October 30, 2024. To access the
live call by phone, use the following link:
https://register.vevent.com/register/BI16186e91b1b24f7ca4b39fa17a26c1ac
You will be provided with dial-in details after
registering. To avoid delays, we recommend that participants dial
into the conference call 15 minutes ahead of the scheduled start
time. A live webcast will also be accessible via the "Events &
Presentations" section of the Company's investor relations website:
www.investors.willscot.com. Choose "Events" and select the
information pertaining to the WillScot Third Quarter 2024
Conference Call. Additionally, there will be slides accompanying
the webcast. Please allow at least 15 minutes prior to the call to
register, download and install any necessary software. For those
unable to listen to the live broadcast, an audio webcast of the
call will be available for 12 months on the Company’s investor
relations website.
About WillScot
Listed on the Nasdaq stock exchange under the
ticker symbol “WSC,” WillScot is the premier provider of highly
innovative and turnkey space solutions in North America. The
Company’s comprehensive range of products includes modular office
complexes, mobile offices, classrooms, temporary restrooms,
portable storage containers, protective buildings and
climate-controlled units, and clearspan structures, as well as a
curated selection of furnishings, appliances, and other
supplementary services, ensuring turnkey solutions for its
customers. Headquartered in Phoenix, Arizona, and operating from a
network of approximately 260 branch locations and additional drop
lots across the United States, Canada, and Mexico, WillScot’s
business services are essential for diverse customer segments
spanning all sectors of the economy.
Forward-Looking Statements
This news release contains forward-looking
statements (including the guidance/outlook contained herein) within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995 and Section 21E of the Securities Exchange Act of 1934, as
amended. The words "estimates," "expects," "anticipates,"
"believes," "forecasts," "plans," "intends," "may," "will,"
"should," "shall," "outlook," "guidance," "see," "have confidence"
and variations of these words and similar expressions identify
forward-looking statements, which are generally not historical in
nature. Certain of these forward-looking statements include
statements relating to: our mergers and acquisitions pipeline,
acceleration of our run rate, acceleration toward and the timing of
our achievement of our three to five year milestones, growth and
acceleration of cash flow, driving higher returns on invested
capital, and Adjusted EBITDA margin expansion, as well as
statements involving the proposed acquisition of McGrath (the
“Proposed Transaction”), including anticipated time of closing, the
expected scale, operating efficiency and synergies, stockholder,
employee and customer benefits, the amount and timing of revenue
and expense synergies, future financial benefits and operating
results, expectations relating to the combined customer base and
rental fleet, and tax treatment for the acquisition.
Forward-looking statements are subject to a number of risks,
uncertainties, assumptions and other important factors, many of
which are outside our control, which could cause actual results or
outcomes to differ materially from those discussed in the
forward-looking statements. Although the Company believes that
these forward-looking statements are based on reasonable
assumptions, they are predictions and we can give no assurance that
any such forward-looking statement will materialize. Important
factors that may affect actual results or outcomes include, among
others, our ability to acquire and integrate new assets and
operations; our ability to judge the demand outlook; our ability to
achieve planned synergies related to acquisitions; regulatory
approvals; our ability to successfully execute our growth strategy,
manage growth and execute our business plan; our estimates of the
size of the markets for our products; the rate and degree of market
acceptance of our products; the success of other competing modular
space and portable storage solutions that exist or may become
available; rising costs and inflationary pressures adversely
affecting our profitability; potential litigation involving our
Company; general economic and market conditions impacting demand
for our products and services and our ability to benefit from an
inflationary environment; our ability to maintain an effective
system of internal controls; and such other risks and uncertainties
described in the periodic reports we file with the SEC from time to
time (including our Form 10-K for the year ended December 31,
2023), which are available through the SEC’s EDGAR system at
www.sec.gov and on our website. Any forward-looking statement
speaks only at the date on which it is made, and the Company
disclaims any obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
Additional Information and Where to Find
It
Additional information can be found on the
company's website at www.willscot.com.
|
Contact Information |
|
|
| |
|
|
|
Investor Inquiries: |
|
Media Inquiries: |
|
Nick Girardi |
|
Jake Saylor |
|
investors@willscot.com |
|
jake.saylor@willscot.com |
| |
|
|
|
WillScot Holdings Corporation |
|
Consolidated Statements of Operations |
|
(Unaudited) |
| |
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands, except share and per share
data) |
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Revenues: |
|
|
|
|
|
|
|
|
Leasing and services revenue: |
|
|
|
|
|
|
|
|
Leasing |
$ |
455,578 |
|
|
$ |
466,769 |
|
|
$ |
1,374,771 |
|
|
$ |
1,356,040 |
|
|
Delivery and installation |
|
114,765 |
|
|
|
115,598 |
|
|
|
323,274 |
|
|
|
334,982 |
|
|
Sales revenue: |
|
|
|
|
|
|
|
|
New units |
|
17,850 |
|
|
|
10,155 |
|
|
|
52,727 |
|
|
|
29,816 |
|
|
Rental units |
|
13,239 |
|
|
|
12,312 |
|
|
|
42,431 |
|
|
|
31,553 |
|
|
Total revenues |
|
601,432 |
|
|
|
604,834 |
|
|
|
1,793,203 |
|
|
|
1,752,391 |
|
|
Costs: |
|
|
|
|
|
|
|
|
Costs of leasing and services: |
|
|
|
|
|
|
|
|
Leasing |
|
96,050 |
|
|
|
104,331 |
|
|
|
296,692 |
|
|
|
300,402 |
|
|
Delivery and installation |
|
91,775 |
|
|
|
82,081 |
|
|
|
250,787 |
|
|
|
238,437 |
|
|
Costs of sales: |
|
|
|
|
|
|
|
|
New units |
|
9,665 |
|
|
|
5,096 |
|
|
|
31,296 |
|
|
|
16,099 |
|
|
Rental units |
|
6,246 |
|
|
|
6,682 |
|
|
|
22,207 |
|
|
|
16,203 |
|
|
Depreciation of rental equipment |
|
76,212 |
|
|
|
66,950 |
|
|
|
226,731 |
|
|
|
190,556 |
|
|
Gross profit |
|
321,484 |
|
|
|
339,694 |
|
|
|
965,490 |
|
|
|
990,694 |
|
|
Other operating expenses: |
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
150,865 |
|
|
|
151,983 |
|
|
|
493,043 |
|
|
|
449,663 |
|
|
Other depreciation and amortization |
|
23,108 |
|
|
|
17,852 |
|
|
|
59,163 |
|
|
|
52,371 |
|
|
Termination fee |
|
180,000 |
|
|
|
— |
|
|
|
180,000 |
|
|
|
— |
|
|
Impairment loss on intangible asset |
|
— |
|
|
|
— |
|
|
|
132,540 |
|
|
|
— |
|
|
Restructuring costs |
|
2,334 |
|
|
|
— |
|
|
|
8,540 |
|
|
|
— |
|
|
Lease impairment expense and other related charges, net |
|
144 |
|
|
|
— |
|
|
|
867 |
|
|
|
22 |
|
|
Currency (gains) losses, net |
|
(129 |
) |
|
|
96 |
|
|
|
(94 |
) |
|
|
6,885 |
|
|
Other expense (income), net |
|
380 |
|
|
|
(8,336 |
) |
|
|
1,935 |
|
|
|
(14,533 |
) |
|
Operating (loss) income |
|
(35,218 |
) |
|
|
178,099 |
|
|
|
89,496 |
|
|
|
496,286 |
|
|
Interest expense, net |
|
55,823 |
|
|
|
53,803 |
|
|
|
167,959 |
|
|
|
145,915 |
|
|
(Loss) income from continuing operations before income tax |
|
(91,041 |
) |
|
|
124,296 |
|
|
|
(78,463 |
) |
|
|
350,371 |
|
|
Income tax (benefit) expense from continuing operations |
|
(20,566 |
) |
|
|
32,780 |
|
|
|
(17,377 |
) |
|
|
94,855 |
|
|
(Loss) income from continuing operations |
|
(70,475 |
) |
|
|
91,516 |
|
|
|
(61,086 |
) |
|
|
255,516 |
|
| |
|
|
|
|
|
|
|
|
Discontinued operations: |
|
|
|
|
|
|
|
|
Income from discontinued operations before income tax |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,003 |
|
|
Gain on sale of discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
176,078 |
|
|
Income tax expense from discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
45,468 |
|
|
Income from discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
134,613 |
|
| |
|
|
|
|
|
|
|
|
Net (loss) income |
$ |
(70,475 |
) |
|
$ |
91,516 |
|
|
$ |
(61,086 |
) |
|
$ |
390,129 |
|
| |
|
|
|
|
|
|
|
|
(Loss) earnings per share from continuing operations: |
|
|
|
Basic |
$ |
(0.37 |
) |
|
$ |
0.47 |
|
|
$ |
(0.32 |
) |
|
$ |
1.27 |
|
|
Diluted |
$ |
(0.37 |
) |
|
$ |
0.46 |
|
|
$ |
(0.32 |
) |
|
$ |
1.25 |
|
|
Earnings per share from discontinued operations: |
|
|
|
Basic |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
0.67 |
|
|
Diluted |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
0.66 |
|
|
(Loss) earnings per share: |
|
|
|
|
|
Basic |
$ |
(0.37 |
) |
|
$ |
0.47 |
|
|
$ |
(0.32 |
) |
|
$ |
1.94 |
|
|
Diluted |
$ |
(0.37 |
) |
|
$ |
0.46 |
|
|
$ |
(0.32 |
) |
|
$ |
1.91 |
|
|
Weighted average shares: |
|
|
|
|
|
|
|
|
Basic |
|
188,281,346 |
|
|
|
196,198,638 |
|
|
|
189,362,364 |
|
|
|
201,042,902 |
|
|
Diluted |
|
188,281,346 |
|
|
|
199,258,304 |
|
|
|
189,362,364 |
|
|
|
204,461,042 |
|
|
WillScot Holdings Corporation |
|
Consolidated Balance Sheets |
|
|
|
(in thousands, except share data) |
September 30, 2024
(unaudited) |
|
December 31, 2023 |
|
Assets |
|
|
|
|
Cash and cash equivalents |
$ |
11,046 |
|
|
$ |
10,958 |
|
|
Trade receivables, net of allowances for credit losses at September
30, 2024 and December 31, 2023 of $99,241 and $81,656,
respectively |
|
445,869 |
|
|
|
451,130 |
|
|
Inventories |
|
52,576 |
|
|
|
47,406 |
|
|
Prepaid expenses and other current assets |
|
64,750 |
|
|
|
57,492 |
|
|
Assets held for sale – current |
|
4,078 |
|
|
|
2,110 |
|
|
Total current assets |
|
578,319 |
|
|
|
569,096 |
|
|
Rental equipment, net |
|
3,401,198 |
|
|
|
3,381,315 |
|
|
Property, plant and equipment, net |
|
353,338 |
|
|
|
340,887 |
|
|
Operating lease assets |
|
257,054 |
|
|
|
245,647 |
|
|
Goodwill |
|
1,176,889 |
|
|
|
1,176,635 |
|
|
Intangible assets, net |
|
260,539 |
|
|
|
419,709 |
|
|
Other non-current assets |
|
9,882 |
|
|
|
4,626 |
|
|
Total long-term assets |
|
5,458,900 |
|
|
|
5,568,819 |
|
|
Total assets |
$ |
6,037,219 |
|
|
$ |
6,137,915 |
|
|
Liabilities and equity |
|
|
|
|
Accounts payable |
$ |
107,789 |
|
|
$ |
86,123 |
|
|
Accrued expenses |
|
168,462 |
|
|
|
129,621 |
|
|
Accrued employee benefits |
|
24,551 |
|
|
|
45,564 |
|
|
Deferred revenue and customer deposits |
|
249,973 |
|
|
|
224,518 |
|
|
Operating lease liabilities – current |
|
65,708 |
|
|
|
57,408 |
|
|
Current portion of long-term debt |
|
22,933 |
|
|
|
18,786 |
|
|
Total current liabilities |
|
639,416 |
|
|
|
562,020 |
|
|
Long-term debt |
|
3,607,957 |
|
|
|
3,538,516 |
|
|
Deferred tax liabilities |
|
492,152 |
|
|
|
554,268 |
|
|
Operating lease liabilities – non-current |
|
192,133 |
|
|
|
187,837 |
|
|
Other non-current liabilities |
|
51,482 |
|
|
|
34,024 |
|
|
Long-term liabilities |
|
4,343,724 |
|
|
|
4,314,645 |
|
|
Total liabilities |
|
4,983,140 |
|
|
|
4,876,665 |
|
|
Preferred Stock: $0.0001 par, 1,000,000 shares authorized and zero
shares issued and outstanding at September 30, 2024 and December
31, 2023 |
|
— |
|
|
|
— |
|
|
Common Stock: $0.0001 par, 500,000,000 shares authorized and
187,048,646 and 189,967,135 shares issued and outstanding at
September 30, 2024 and December 31, 2023, respectively |
|
19 |
|
|
|
20 |
|
|
Additional paid-in-capital |
|
1,960,163 |
|
|
|
2,089,091 |
|
|
Accumulated other comprehensive loss |
|
(69,924 |
) |
|
|
(52,768 |
) |
|
Accumulated deficit |
|
(836,179 |
) |
|
|
(775,093 |
) |
|
Total shareholders' equity |
|
1,054,079 |
|
|
|
1,261,250 |
|
|
Total liabilities and shareholders' equity |
$ |
6,037,219 |
|
|
$ |
6,137,915 |
|
|
Reconciliation of Non-GAAP Financial Measures |
|
|
In addition to using GAAP financial
measurements, we use certain non-GAAP financial information that we
believe is important for purposes of comparison to prior periods
and development of future projections and earnings growth
prospects. This information is also used by management to measure
the profitability of our ongoing operations and analyze our
business performance and trends.
We evaluate business performance on Adjusted
EBITDA, a non-GAAP measure that excludes certain items as described
below. We believe that evaluating performance excluding such items
is meaningful because it provides insight with respect to intrinsic
and ongoing operating results of the Company.
We also regularly evaluate gross profit to
assist in the assessment of the operational performance. We
consider Adjusted EBITDA to be the more important metric because it
more fully captures the business performance, inclusive of indirect
costs.
We also evaluate Free Cash Flow, a non-GAAP
measure that provides useful information concerning cash flow
available to fund our capital allocation alternatives.
Adjusted EBITDA From Continuing
Operations
We define EBITDA as net income (loss) plus
interest (income) expense, income tax expense (benefit),
depreciation and amortization. Our adjusted EBITDA ("Adjusted
EBITDA") reflects the following further adjustments to EBITDA to
exclude certain non-cash items and the effect of what we consider
transactions or events not related to our core business
operations:
- Goodwill and
other impairment charges related to non-cash costs associated with
impairment charges to goodwill, other intangibles, rental fleet and
property, plant and equipment.
- Restructuring
costs, lease impairment expense, and other related charges
associated with restructuring plans designed to streamline
operations and reduce costs including employee termination
costs.
- Currency (gains)
losses, net on monetary assets and liabilities denominated in
foreign currencies other than the subsidiaries’ functional
currency.
- Transaction
costs including legal and professional fees and other transaction
specific related costs.
- Costs to
integrate acquired companies, including outside professional fees,
non-capitalized costs associated with system integrations,
non-lease branch and fleet relocation expenses, employee training
costs, and other costs required to realize cost or revenue
synergies.
- Non-cash charges
for stock compensation plans.
- Other expense,
including consulting expenses related to certain one-time projects,
financing costs not classified as interest expense, and gains and
losses on disposals of property, plant, and equipment.
Adjusted EBITDA has limitations as an analytical
tool, and you should not consider the measure in isolation or as a
substitute for net income (loss), cash flow from operations or
other methods of analyzing the Company’s results as reported under
GAAP. Some of these limitations are:
- Adjusted EBITDA
does not reflect changes in, or cash requirements for our working
capital needs;
- Adjusted EBITDA
does not reflect our interest expense, or the cash requirements
necessary to service interest or principal payments, on our
indebtedness;
- Adjusted EBITDA
does not reflect our tax expense or the cash requirements to pay
our taxes;
- Adjusted EBITDA
does not reflect historical cash expenditures or future
requirements for capital expenditures or contractual
commitments;
- Adjusted EBITDA
does not reflect the impact on earnings or changes resulting from
matters that we consider not to be indicative of our future
operations;
- Although
depreciation and amortization are non-cash charges, the assets
being depreciated and amortized will often have to be replaced in
the future and Adjusted EBITDA does not reflect any cash
requirements for such replacements; and
- Other companies
in our industry may calculate Adjusted EBITDA differently, limiting
its usefulness as a comparative measure.
Because of these limitations, Adjusted EBITDA
should not be considered as discretionary cash available to
reinvest in the growth of our business or as measures of cash that
will be available to meet our obligations.
The following table provides reconciliations of
Income (loss) from continuing operations to Adjusted EBITDA from
continuing operations:
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(Loss) income from continuing operations |
$ |
(70,475 |
) |
|
$ |
91,516 |
|
|
$ |
(61,086 |
) |
|
$ |
255,516 |
|
|
Income tax (benefit) expense from continuing operations |
|
(20,566 |
) |
|
|
32,780 |
|
|
|
(17,377 |
) |
|
|
94,855 |
|
|
Interest expense |
|
55,823 |
|
|
|
53,803 |
|
|
|
167,959 |
|
|
|
145,915 |
|
|
Depreciation and amortization |
|
99,320 |
|
|
|
84,802 |
|
|
|
285,894 |
|
|
|
242,927 |
|
|
Currency (gains) losses, net |
|
(129 |
) |
|
|
96 |
|
|
|
(94 |
) |
|
|
6,885 |
|
|
Restructuring costs, lease impairment expense and other related
charges, net |
|
2,478 |
|
|
|
— |
|
|
|
9,407 |
|
|
|
22 |
|
|
Termination fee |
|
180,000 |
|
|
|
— |
|
|
|
180,000 |
|
|
|
— |
|
|
Impairment loss on intangible asset |
|
— |
|
|
|
— |
|
|
|
132,540 |
|
|
|
— |
|
|
Transaction costs |
|
235 |
|
|
|
787 |
|
|
|
275 |
|
|
|
787 |
|
|
Integration costs |
|
1,457 |
|
|
|
780 |
|
|
|
7,400 |
|
|
|
6,900 |
|
|
Stock compensation expense |
|
9,534 |
|
|
|
8,636 |
|
|
|
28,247 |
|
|
|
26,134 |
|
|
Other |
|
9,186 |
|
|
|
(7,720 |
) |
|
|
45,283 |
|
|
|
(6,278 |
) |
|
Adjusted EBITDA from continuing operations |
$ |
266,863 |
|
|
$ |
265,480 |
|
|
$ |
778,448 |
|
|
$ |
773,663 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin From Continuing
Operations
We define Adjusted EBITDA Margin as Adjusted
EBITDA divided by revenue. Management believes that the
presentation of Adjusted EBITDA Margin provides useful information
to investors regarding the performance of our business. The
following table provides comparisons of Adjusted EBITDA Margin to
Gross Profit Margin:
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Adjusted EBITDA from continuing operations |
$ |
266,863 |
|
|
$ |
265,480 |
|
|
$ |
778,448 |
|
|
$ |
773,663 |
|
|
Revenue (B) |
$ |
601,432 |
|
|
$ |
604,834 |
|
|
$ |
1,793,203 |
|
|
$ |
1,752,391 |
|
|
Adjusted EBITDA Margin from Continuing Operations (A/B) |
|
44.4 |
% |
|
|
43.9 |
% |
|
|
43.4 |
% |
|
|
44.1 |
% |
|
Gross profit (C) |
$ |
321,484 |
|
|
$ |
339,694 |
|
|
$ |
965,490 |
|
|
$ |
990,694 |
|
|
Gross Profit Margin (C/B) |
|
53.5 |
% |
|
|
56.2 |
% |
|
|
53.8 |
% |
|
|
56.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Debt to Adjusted EBITDA From
Continuing Operations Ratio
Net Debt to Adjusted EBITDA ratio is defined as
Net Debt divided by Adjusted EBITDA from continuing operations from
the last twelve months. We define Net Debt as total debt from
continuing operations net of total cash and cash equivalents from
continuing operations. Management believes that the presentation of
Net Debt to Adjusted EBITDA ratio provides useful information to
investors regarding the performance of our business. The following
table provides a reconciliation of Net Debt to Adjusted EBITDA
ratio:
|
(in thousands) |
September 30, 2024 |
|
Long-term debt |
$ |
3,607,957 |
|
Current portion of long-term debt |
|
22,933 |
|
Total debt |
|
3,630,890 |
|
Cash and cash equivalents |
|
11,046 |
|
Net debt (A) |
$ |
3,619,844 |
| |
|
|
Adjusted EBITDA from continuing operations from the three months
ended December 31, 2023 |
$ |
287,802 |
|
Adjusted EBITDA from continuing operations from the three months
ended March 31, 2024 |
|
248,009 |
|
Adjusted EBITDA from continuing operations from the three months
ended June 30, 2024 |
|
263,576 |
|
Adjusted EBITDA from continuing operations from the three months
ended September 30, 2024 |
|
266,863 |
|
Adjusted EBITDA from continuing operations from the last twelve
months (B) |
$ |
1,066,250 |
|
Net Debt to Adjusted EBITDA ratio (A/B) |
|
3.4 |
|
|
|
|
Adjusted Income from Continuing Operations
and Adjusted Diluted Earnings Per Share
We define adjusted income from continuing
operations as income from continuing operations, plus certain
non-cash items and the effect of what we consider transactions not
related to our core business operations including:
- Goodwill and
other impairment charges related to non-cash costs associated with
impairment charges to goodwill, other intangibles, rental fleet and
property, plant and equipment.
- Restructuring
costs, lease impairment expense, and other related charges
associated with restructuring plans designed to streamline
operations and reduce costs including employee and lease
termination costs.
- Transaction
costs including legal and professional fees and other transaction
specific related costs.
- Costs to
integrate acquired companies, including outside professional fees,
non-capitalized costs associated with system integrations,
non-lease branch and fleet relocation expenses, employee training
costs, and other costs required to realize cost or revenue
synergies.
- Transaction
costs, including legal and professional fees and other
transaction-specific costs, for terminated acquisitions.
We define adjusted diluted earnings per share
from continuing operations as adjusted income from continuing
operations divided by adjusted diluted weighted average common
shares outstanding. Management believes that the presentation of
Adjusted Income and Adjusted Diluted Earnings Per Share provide
useful information to investors regarding the performance of our
business.
The following table provides reconciliations of
income from continuing operations to adjusted income from
continuing operations and comparisons of diluted earnings per share
to adjusted diluted earnings per share:
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands, except share data) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(Loss) income from continuing operations |
$ |
(70,475 |
) |
|
$ |
91,516 |
|
|
$ |
(61,086 |
) |
|
$ |
255,516 |
|
|
Restructuring costs, lease impairment expense and other related
charges, net |
|
2,478 |
|
|
|
— |
|
|
|
9,407 |
|
|
|
22 |
|
|
Termination fee |
|
180,000 |
|
|
|
— |
|
|
|
180,000 |
|
|
|
— |
|
|
Impairment loss on intangible asset |
|
— |
|
|
|
— |
|
|
|
132,540 |
|
|
|
— |
|
|
Transaction costs |
|
235 |
|
|
|
787 |
|
|
|
275 |
|
|
|
787 |
|
|
Integration costs |
|
1,457 |
|
|
|
780 |
|
|
|
7,400 |
|
|
|
6,900 |
|
|
Transaction costs from terminated acquisitions |
|
8,704 |
|
|
|
752 |
|
|
|
43,884 |
|
|
|
1,217 |
|
|
Estimated tax impact1 |
|
(50,147 |
) |
|
|
(603 |
) |
|
|
(97,112 |
) |
|
|
(2,321 |
) |
|
Adjusted income from continuing operations |
$ |
72,252 |
|
|
$ |
93,232 |
|
|
$ |
215,308 |
|
|
$ |
262,121 |
|
| |
|
|
|
|
|
|
|
|
(Loss) income from continuing operations per adjusted diluted
share2 |
$ |
(0.37 |
) |
|
$ |
0.46 |
|
|
$ |
(0.32 |
) |
|
$ |
1.25 |
|
|
Restructuring costs, lease impairment expense and other related
charges, net |
|
0.01 |
|
|
|
— |
|
|
|
0.05 |
|
|
|
— |
|
|
Termination fee |
|
0.95 |
|
|
|
— |
|
|
|
0.94 |
|
|
|
— |
|
|
Impairment loss on intangible asset |
|
— |
|
|
|
— |
|
|
|
0.69 |
|
|
|
— |
|
|
Transaction costs |
|
— |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
|
Integration costs |
|
0.01 |
|
|
|
— |
|
|
|
0.04 |
|
|
|
0.03 |
|
|
Transaction costs from terminated acquisitions |
|
0.05 |
|
|
|
— |
|
|
|
0.23 |
|
|
|
0.01 |
|
|
Estimated tax impact1 |
|
(0.27 |
) |
|
|
— |
|
|
|
(0.51 |
) |
|
|
(0.01 |
) |
|
Adjusted Diluted Earnings Per Share |
$ |
0.38 |
|
|
$ |
0.47 |
|
|
$ |
1.12 |
|
|
$ |
1.28 |
|
| |
|
|
|
|
|
|
|
|
Weighted average diluted shares outstanding |
|
188,281,346 |
|
|
|
199,258,304 |
|
|
|
189,362,364 |
|
|
|
204,461,042 |
|
|
Adjusted weighted average dilutive shares
outstanding2 |
|
190,181,020 |
|
|
|
199,258,304 |
|
|
|
191,662,791 |
|
|
|
204,461,042 |
|
1 We include estimated taxes at our
current statutory tax rate of approximately 26%.
2 For the three and nine months ended
September 30, 2024, diluted loss per share is based on weighted
average diluted shares outstanding of 188,281,346 and 189,362,364,
respectively, which excluded shares related to stock awards, as the
effect would be anti-dilutive. The calculation of adjusted diluted
earnings per share for the three and nine months ended September
30, 2024 is based on adjusted weighted average diluted shares
outstanding of 190,181,020 and 191,662,791, respectively, as the
shares related to stock awards are dilutive for adjusted diluted
earnings per share.
Free Cash Flow, Adjusted Free Cash Flow,
Free Cash Flow Margin, and Adjusted Free Cash Flow
Margin
Free Cash Flow and Adjusted Free Cash Flow are
non-GAAP measures. We define Free Cash Flow as net cash provided by
operating activities, less purchases of, and proceeds from, rental
equipment and property, plant and equipment, which are all included
in cash flows from investing activities. We define Adjusted Free
Cash Flow as Free Cash Flow excluding one-time, nonrecurring
payments for the McGrath termination fee and transaction costs from
terminated acquisitions. Free Cash Flow Margin is defined as Free
Cash Flow divided by Total Revenue including discontinued
operations. Adjusted Free Cash Flow Margin is defined as Adjusted
Free Cash Flow divided by Total Revenue including discontinued
operations. Management believes that the presentation of Free Cash
Flow, Adjusted Free Cash Flow, Free Cash Flow Margin, and Adjusted
Free Cash Flow Margin provides useful additional information
concerning cash flow available to fund our capital allocation
alternatives. Free Cash Flow and Adjusted Free Cash Flow as
presented include amounts for the former UK Storage Solutions
segment through January 31, 2023. The following table provides
reconciliations of Free Cash Flow, Adjusted Free Cash Flow, Free
Cash Flow Margin and Adjusted Free Cash Flow Margin:
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Net cash (used in) provided by operating activities |
$ |
(1,562 |
) |
|
$ |
190,998 |
|
|
$ |
382,725 |
|
|
$ |
541,918 |
|
|
Purchase of rental equipment and refurbishments |
|
(69,398 |
) |
|
|
(63,388 |
) |
|
|
(206,989 |
) |
|
|
(166,097 |
) |
|
Proceeds from sale of rental equipment |
|
13,238 |
|
|
|
12,720 |
|
|
|
43,906 |
|
|
|
37,974 |
|
|
Purchase of property, plant and equipment |
|
(3,318 |
) |
|
|
(5,563 |
) |
|
|
(16,119 |
) |
|
|
(16,752 |
) |
|
Proceeds from the sale of property, plant and equipment |
|
918 |
|
|
|
13,001 |
|
|
|
1,133 |
|
|
|
13,266 |
|
|
Free Cash Flow (A) |
$ |
(60,122 |
) |
|
$ |
147,768 |
|
|
$ |
204,656 |
|
|
$ |
410,309 |
|
|
Cash paid for termination Fee |
|
180,000 |
|
|
|
— |
|
|
|
180,000 |
|
|
|
— |
|
|
Cash paid for transaction costs from terminated acquisitions |
|
23,266 |
|
|
|
— |
|
|
|
32,451 |
|
|
|
— |
|
|
Adjusted Free Cash Flow (B) |
$ |
143,144 |
|
|
$ |
147,768 |
|
|
$ |
417,107 |
|
|
$ |
410,309 |
|
| |
|
|
|
|
|
|
|
|
Revenue from continuing operations (C) |
$ |
601,432 |
|
|
$ |
604,834 |
|
|
$ |
1,793,203 |
|
|
$ |
1,752,391 |
|
|
Revenue from discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,694 |
|
|
Total Revenue including discontinued operations (D) |
$ |
601,432 |
|
|
$ |
604,834 |
|
|
$ |
1,793,203 |
|
|
$ |
1,761,085 |
|
|
Free Cash Flow Margin (A/D) |
(10.0 |
)% |
|
|
24.4 |
% |
|
|
11.4 |
% |
|
|
23.3 |
% |
|
Adjusted Free Cash Flow Margin (B/D) |
|
23.8 |
% |
|
|
24.4 |
% |
|
|
23.3 |
% |
|
|
23.3 |
% |
| |
|
|
|
|
|
|
|
|
Net cash (used in) provided by operating activities (E) |
$ |
(1,562 |
) |
|
$ |
190,998 |
|
|
$ |
382,725 |
|
|
$ |
541,918 |
|
|
Net cash (used in) provided by operating activities margin
(E/D) |
(0.3 |
)% |
|
|
31.6 |
% |
|
|
21.3 |
% |
|
|
30.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net CAPEX
We define Net CAPEX as purchases of rental
equipment and refurbishments and purchases of property, plant and
equipment (collectively, "Total Capital Expenditures"), less
proceeds from the sale of rental equipment and proceeds from the
sale of property, plant and equipment (collectively, "Total
Proceeds"), which are all included in cash flows from investing
activities. Management believes that the presentation of Net CAPEX
provides useful information regarding the net capital invested in
our rental fleet and property, plant and equipment each year to
assist in analyzing the performance of our business. As presented
below, Net CAPEX includes amounts for the former UK Storage
Solutions segment through January 31, 2023.
The following table provides reconciliations of
Net CAPEX, which is calculated using metrics from our Statements of
Cash Flows:
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Purchases of rental equipment and refurbishments |
$ |
(69,398 |
) |
|
$ |
(63,388 |
) |
|
$ |
(206,989 |
) |
|
$ |
(166,097 |
) |
|
Proceeds from sale of rental equipment |
|
13,238 |
|
|
|
12,720 |
|
|
|
43,906 |
|
|
|
37,974 |
|
|
Net CAPEX for Rental Equipment |
|
(56,160 |
) |
|
|
(50,668 |
) |
|
|
(163,083 |
) |
|
|
(128,123 |
) |
|
Purchases of property, plant and equipment |
|
(3,318 |
) |
|
|
(5,563 |
) |
|
|
(16,119 |
) |
|
|
(16,752 |
) |
|
Proceeds from sale of property, plant and equipment |
|
918 |
|
|
|
13,001 |
|
|
|
1,133 |
|
|
|
13,266 |
|
|
Net CAPEX |
$ |
(58,560 |
) |
|
$ |
(43,230 |
) |
|
$ |
(178,069 |
) |
|
$ |
(131,609 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on Invested Capital
Return on Invested Capital is defined as
Adjusted earnings before interest and amortization divided by
Average Invested Capital. Management believes that the presentation
of Return on Invested Capital provides useful information regarding
the long-term health and profitability of the business relative to
the Company's cost of capital. We define Adjusted earnings before
interest and amortization as Adjusted EBITDA (see reconciliation
above) reduced by depreciation and estimated taxes. Given we are
not a significant US taxpayer due to our current tax attributes, we
include estimated taxes at our current statutory tax rate of
approximately 26%.
The Average Invested Capital is calculated as an
average of Net Assets, a four quarter average for annual metrics
and two quarter average for quarterly metrics. Net assets is
defined for purposes of the calculation below as total assets less
goodwill, intangible assets, net, and all non-interest bearing
liabilities.
The following table provides reconciliations of
Return on Invested Capital and includes amounts for the former UK
Storage Solutions segment through January 31, 2023.
| |
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
(in thousands) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Total Assets |
$ |
6,037,219 |
|
|
$ |
6,075,478 |
|
|
$ |
6,037,219 |
|
|
$ |
6,075,478 |
|
|
Goodwill |
|
(1,176,889 |
) |
|
|
(1,158,076 |
) |
|
|
(1,176,889 |
) |
|
|
(1,158,076 |
) |
|
Intangible assets, net |
|
(260,539 |
) |
|
|
(401,313 |
) |
|
|
(260,539 |
) |
|
|
(401,313 |
) |
|
Total Liabilities |
|
(4,983,140 |
) |
|
|
(4,762,842 |
) |
|
|
(4,983,140 |
) |
|
|
(4,762,842 |
) |
|
Long Term Debt |
|
3,607,957 |
|
|
|
3,460,066 |
|
|
|
3,607,957 |
|
|
|
3,460,066 |
|
|
Net Assets, as defined above |
$ |
3,224,608 |
|
|
$ |
3,213,313 |
|
|
$ |
3,224,608 |
|
|
$ |
3,213,313 |
|
|
Average Invested Capital (A) |
$ |
3,218,527 |
|
|
$ |
3,133,997 |
|
|
$ |
3,209,496 |
|
|
$ |
3,104,225 |
|
| |
|
|
|
|
|
|
|
|
Adjusted EBITDA |
$ |
266,863 |
|
|
$ |
265,480 |
|
|
$ |
778,448 |
|
|
$ |
773,663 |
|
|
Depreciation |
|
(87,415 |
) |
|
|
(78,864 |
) |
|
|
(259,264 |
) |
|
|
(225,114 |
) |
|
Adjusted EBITA (B) |
$ |
179,448 |
|
|
$ |
186,616 |
|
|
$ |
519,184 |
|
|
$ |
548,549 |
|
| |
|
|
|
|
|
|
|
|
Statutory Tax Rate (C) |
|
26 |
% |
|
|
26 |
% |
|
|
26 |
% |
|
|
26 |
% |
|
Estimated Tax (B*C) |
$ |
46,656 |
|
|
$ |
48,520 |
|
|
$ |
134,988 |
|
|
$ |
142,623 |
|
|
Adjusted earnings before interest and amortization (D) |
$ |
132,792 |
|
|
$ |
138,096 |
|
|
$ |
384,196 |
|
|
$ |
405,926 |
|
|
ROIC (D/A), annualized |
|
16.5 |
% |
|
|
17.6 |
% |
|
|
16.0 |
% |
|
|
17.4 |
% |
Willscot (LSE:0A1N)
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From Nov 2024 to Dec 2024
Willscot (LSE:0A1N)
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From Dec 2023 to Dec 2024
