United Rentals (NYSE: URI) reported Q4 EPS of $5.04, $0.85 better than the analyst estimate of $4.19. Revenue for the quarter came in at $2.28 billion versus the consensus estimate of $2.16 billion.

Fourth Quarter 2020 Highlights

• Total revenue of $2.279 billion, including rental revenue2 of $1.854 billion.
• Fleet productivity3 decreased 3.8% year-over-year, mainly due to lower rental volumes; fleet productivity improved 420 basis points sequentially, primarily due to better fleet absorption.
• Net income of $297 million, implying a net income margin4 of 13.0%. GAAP diluted earnings per share of $4.09, and adjusted EPS4 of $5.04.
• Adjusted EBITDA4 of $1.037 billion, implying an adjusted EBITDA margin4 of 45.5%.
• Full year net cash from operating activities of $2.658 billion; free cash flow5 of $2.440 billion, including gross rental capital spending of $961 million.
• Year-end net leverage ratio of 2.4x, with total liquidity6 of $3.073 billion.

CEO Comment

Matthew Flannery, chief executive officer of United Rentals, said, “I want to thank our employees for safely supporting our customers in 2020 and delivering an exceptional performance despite unprecedented challenges. Results for the fourth quarter exceeded our expectations, driven by stronger rental volume and robust used equipment sales. We are encouraged by the momentum this gives us going into 2021.”

Flannery continued, “Our guidance reflects an improvement in customer sentiment as the economy continues to heal, and our own confidence in our ability to execute. After lapping a challenging comp in the first quarter, we expect to pivot back to growth through the remainder of the year, which, together with continued cost discipline, will deliver strong profitability. We anticipate another robust year of free cash flow generation, after significantly increasing our capex to support growing demand.”

GUIDANCE:

United Rentals sees FY2021 revenue of $8.625-9.025 billion, versus the consensus of $8.53 billion.

For earnings history and earnings-related data on United Rentals (URI) click here.