Positive results at McGrath RentCorp

Nine-month revenues have increased at US rental company McGrath RentCorp, fuelled by growth from its mobile modular business.

Overall revenues for the period stood at US$299 million (€272 million), compared to US$296 million (€269 million) a year ago. This included rental revenues of US$203 million (€184 million), up from US$198 million (€180 million) for the same period in 2014.

McGrath RentCorp operates four business divisions, the largest of which by revenues is its mobile modular business, which reported nine-month revenues of US$134 million (€122 million), up from US$117 million (€106 million) a year ago.

The TRS-RenTelco division, which rents electronic testing equipment, saw nine month revenues drop year-on-year to US$85 million (€77 million), from US$94 million (€85 million) in 2014.

Alder Tanks, the containment tank division, reported revenues of US$72 million (€65 million) for the nine month period, compared to US$74 million (€76 million) in 2014.

Finally Enviroplex, which is involved with school facilities manufacturing, reported nine month revenues of US$8.4 million (€7.6 million), down from US$10.6 million (€9.3 million) a year ago.

McGrath’s overall nine-month net income totalled US$29 million (€26 million), compared to US$32 million (€29 million) for the same period last year.

President and CEO Dennis Kakures said third quarter earnings had been boosted by higher rental equipment utilisation, a larger fleet and lower equipment processing costs in the company’s modular division, despite the continuing market challenges in both its electronics and liquid and solid containment rental businesses.

“Modular division [third] quarter-end rental equipment utilisation based on original acquisition cost reached 77.9%, our highest level since the first quarter of 2009,” Mr Kakures said, adding, “Modular division-wide rental revenues for the [third] quarter increased 19% to US$30.2 million (€27 million) from a year ago.”

Commenting on market conditions, Mr Kakures said, “Cyclical challenges with our different rental businesses will occur from time to time, just as we are experiencing today with our electronics and liquid and solid containment divisions. However, that shouldn't overshadow the significant potential future financial performance of these rental businesses over time.”