In This Article:
-
Total Revenue: Increased 10% to $244 million for Q4 2024.
-
Adjusted EBITDA: Increased 5% to $92 million for Q4 2024.
-
Mobile Modular Revenue: Increased 14% to $171.8 million for Q4 2024.
-
Mobile Modular Rental Revenue: Increased 8% for Q4 2024.
-
Mobile Modular Sales Revenue: Increased 32% for Q4 2024.
-
Mobile Modular Rental Margins: Increased to 65% from 63% a year ago.
-
Portable Storage Rental Revenue: Decreased 15% for Q4 2024.
-
Portable Storage Rental Margins: 85%, down from 87% a year ago.
-
TRS-RenTelco Revenue: Decreased 3% to $34 million for Q4 2024.
-
TRS-RenTelco Rental Revenue: Decreased 9% for Q4 2024.
-
TRS-RenTelco Sales Revenue: Increased 26% to $7.3 million for Q4 2024.
-
Interest Expense: Decreased to $8.9 million for Q4 2024.
-
Net Cash from Operating Activities: $374 million for the year.
-
2025 Revenue Outlook: Expected between $920 million and $970 million.
-
2025 Adjusted EBITDA Outlook: Expected between $345 million and $360 million.
Release Date: February 19, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Total company revenues increased by 10% and adjusted EBITDA increased by 5% compared to the previous year.
-
Mobile Modular had a strong quarter with rental revenues growing 8% and sales revenues growing 32%.
-
The Education business benefited from modernization and growth projects, supported by a $10 billion bond passed in California for school facilities.
-
McGrath RentCorp (NASDAQ:MGRC) announced an increase in the company's dividend for the 34th consecutive year, highlighting its shareholder focus.
-
The company is entering 2025 with good momentum in Mobile Modular and TRS-RenTelco, with early positive signs in customer activity levels.
Negative Points
-
Portable storage rental revenues declined by 15% due to less activity in commercial construction, driven by high interest rates.
-
TRS-RenTelco rental revenues declined by 9% due to an industry-wide slowdown in test and measurement equipment markets.
-
Utilization dipped year-over-year, ending the quarter at 75.1%, indicating some softness in demand.
-
The company expects portable storage adjusted EBITDA to be lower in 2025 than in 2024, starting the year at a challenging position.
-
The shift from capital spending to operating expenses in 2025 is expected to reduce adjusted EBITDA, despite revenue growth.
Q & A Highlights
Q: Could you discuss the growth in the Modular segment, specifically in commercial offices versus education, and provide your outlook for 2025? A: Keith Pratt, CFO, explained that rental revenue growth in the fourth quarter for modulars was 8%, with commercial growing 9% and education 7%. For 2025, they expect balanced growth between these segments, with positive customer activity and funding, particularly in education, indicating a strong outlook.