Chicago-based NES Rentals Holdings, Inc., last week announced its 2004 financial results. Total revenues for 2004, including general rental and traffic safety divisions, were $588 million for the year, an increase of four percent or $21 million over 2003 revenues of $567 million. The rental revenue increase resulted primarily from rate increases of 10 percent on a 5 percent smaller rental fleet. Rental revenues accounted for 84 percent of the company’s total revenues in 2004.
Adding to the company’s improved performance were strong revenues in its Traffic Safety segment, which rents traffic control equipment and provides related services to manage traffic flow during road construction. This activity accounts for approximately 20 percent of total revenues and rose to $111 million in 2004 from $97 million in 2003. The company attributes this 15-percent increase to strong division management led by experienced traffic safety professionals leading to increased market share in existing markets and expansion throughout the Midwest.
A strong post-emergence cash flow from operations of $97 million in 2004 allowed for the investment of $100 million in new equipment, up from $34 million in 2003. This reflects the benefits of the company’s recent debt restructuring, new credit facility and overall stronger operating results.
Used equipment sales rose to $43 million in 2004 compared to $30 million in 2003. The increased sales were driven by management focus on improving fleet age, equipment mix and increases in used equipment pricing.
“Improved performance in 2004 can be attributed to several factors: overall strength in the industrial and construction sectors we serve, operational efficiencies across the organization, efficient fleet usage, and the rollout of a more aggressive pricing strategy and marketing program, to name a few,” said NES Rentals president and CEO Andrew Studdert. “With a strong management team, an enhanced and more strategically focused fleet and positive market fundamentals, we are optimistic that the momentum we gained in 2004 will carry forward into the coming year.”
NES Rentals is No. 4 on the RER 100.