United Rentals Q4 Profit, Revenue Rise
[Stay on top of transportation news: Get TTNews in your inbox.]
Profit and revenue at United Rentals rose in the fourth quarter of 2024, winning plaudits from analysts and investors.
The Stamford, Conn.-based company, which ranks No. 11 on the Transport Topics Top 100 list of the largest private carriers in North America, posted a 1.5% increase in Q4 net income to $689 million from $679 million.
United’s revenue totaled $4.095 billion in the three months that ended Dec. 31, a 9.8% increase from $3.728 billion a year earlier. The company’s rental revenue for the quarter increased 9.7% year over year to a fourth-quarter record of $3.422 billion from $3.119 billion.
Breaking down the company’s revenue, United’s general rentals operations revenue saw a 2.2% year-over-year increase to a fourth-quarter record of $2.339 billion from $2.289 billion.
But specialty rentals revenue jumped 30.5% year over year to a fourth-quarter record of $1.083 billion, boosted by the March 2023 Yak Access acquisition, from $830 million. Even excluding the impact of the Yak acquisition, specialty rental revenue increased 17.8% year over year, the company noted.
United acquired matting company Yak Access from Platinum Equity for about $1.1 billion.
Earlier in January, United unveiled plans to buy H&E Equipment Services for $3.4 billion in cash, adding to its construction and industrial markets equipment fleet. On the TT list of top equipment rental providers, United ranks No. 1 and H&E No. 5.
H&E has about 2,900 employees, around 64,000 pieces of rental equipment and about 160 branches in over 30 U.S. states.
United has about 1,500 rental locations in North America, including in 49 states and every Canadian province. It operates around 2,500 tractors.
The H&E deal is still expected to close by the end of the first quarter, United CEO Matthew Flannery told analysts during a Jan. 30 conference call on the results.
“The transaction checks all three boxes we require when evaluating M&A: strategic, financial and cultural,” Flannery said. “Growing the core is a key component of our strategy and I’m really thrilled to have the opportunity to add high-quality capacity — meaning people, fleet and real estate — to the United Rentals team.
“This will allow us to better serve customer demand over the long term. It’ll also accelerate our growth, all while generating compelling returns for our shareholders. It’s really a win-win outcome,” the company’s top executive added.
Beyond the H&E deal, Flannery expressed satisfaction with United’s performance in the most recent quarter, which he deemed “solid.”
“We again saw growth across our construction and industrial end-markets, as well as continued strong demand for used equipment,” he told analysts.
“Non-residential growth [continued] to fuel construction. And industrial growth driven by manufacturing and power,” he said, adding there were new data center, chip manufacturing, sports stadium and power generation projects.
David Bell, CEO of CloneOps.ai, discusses the impact of AI on the trucking industry. Tune in above or by going to RoadSigns.ttnews.com.
The used equipment continues to exhibit strong demand, said Flannery. “The depth and health of demand in the used market is allowing us to rotate our existing fleet to ensure we can serve our customers’ needs efficiently,” he added.
Used equipment market strength saw United’s free cash flow total $2.1 billion by the end of the most recent quarter and 2024.
Analysts and investors were also satisfied. The company’s share price rose over 2% after the market opened and the call Jan. 30.
Melius Research founding partner Rob Wertheimer said the results were roughly as expected.
“The lesson from this 4Q result and the 2025 growth outlook is that investors can again take a little additional comfort from United Rentals’ consistent and measured execution,” Wertheimer said. “Looking across 2024 and into 2025 what also stands out is the way United Rentals has managed through a changing construction backdrop with more success and steadiness than peers.”
Want more news? Listen to today's daily briefing above or go here for more info
United expects revenue to total $15.6 billion to $16.1 billion in 2025, compared with $15.345 billion in 2024, even without the H&E acquisition factored in.
“We are now focused on 2025 and putting our playbook to work to drive another year of profitable growth, strong free cash flow and attractive shareholder returns,” said Flannery.
“Today’s guidance reflects our stand-alone expectations for continued growth, supported by numerous factors including both the demand we’ve carried into the new year and customer optimism. We look forward to the year ahead, including closing on our acquisition of H&E and welcoming those team members to United Rentals,” he added.
United executives declined to take questions on the impact, financial and otherwise, of the H&E acquisition from analysts as the deal has yet to close, promising future opportunities would be available.
