United Rentals had a strong first quarter, as the company shows with its results this week, and specialty rentals continues to play a leading role, Matt Flannery, president and chief operating officer pointed out on the company’s conference call to investors.
“Geographically, we grew revenue in both the U.S. and Canada year-over-year with all of our regions showing strong demand,” Flannery said. “Our specialty operations continue to be a big part of our growth strategy. And in the first quarter, our Trench, Power and Fluid Solutions segment grew rental revenue by 44 percent. Now, this reflects our two acquisitions in Fluid Solutions, but also 12 percent to 14 percent organic growth. When we bought BakerCorp back in July, we gained tank and filtration expertise. This strengthened our ability to provide Fluid Solutions to our customers. And with Thompson Pump, we gained a leading position in turnkey sewer bypass solutions and well point de-watering. In addition, we opened eight specialty cold starts in the first quarter against a planned 27 for the year. Our specialty footprint currently stands at a record 341 locations and growing.”
Flannery was equally bullish about United’s general and industrial rental business.
“After some Q1 delays due to weather, projects are starting up at a good clip and most importantly, our customers are optimistic,” he said. “And here's an overview of Q1. We saw meaningful growth in all three of our construction verticals of non-residential, infrastructure and residential. And in the industrial sector, all 12 of the verticals we track pointed to market strength with five of those verticals generating double-digit revenue growth for the quarter.”
While Flannery was optimistic about construction activity and the contributions brought by acquired companies, he gave a lot of credit to United Rentals’ safety culture and performance as keys to the company’s continued strong performance.
“It's our most important differentiator, because it protects our most important assets, our people and it matters to our customers,” Flannery noted. “We just completed two years of acquisition activity with one integration after another. So, it makes me particularly proud when I see a safety performance like the one we just achieved. For the first quarter, Team United had a total recordable rate of just 0.71. A year ago, that rate was 0.98, which is a really good result for any industry. So we were good before and now we're even better. And to top it off, two of our regions ended the quarter with a recordable rate of zero. And someday, I hope to be telling you that the entire company came in at zero, because that's our goal.”
Flannery summed up his comments by saying the cycle is still in the rental company’s favor.
“We're looking at another year of solid growth,” he said. “Most important, our people, our processes and our strategy, are all aligned with the customer opportunity. You've heard us talk about balancing growth, margins, returns and free cash flow, that's our mantra. But before we do any of those things, we have to first perform for our customers. And we have to do it well enough to earn their next revenue opportunity each and every day.”
To review United Rentals’ first quarter results, go to: https://rermag.com/headline-news/united-rentals-posts-23-percent-first-quarter-rental-volume-hike