General Finance Corporation (“General Finance” and, with its consolidated subsidiaries, the “Company”) (NASDAQ: GFN) (NASDAQ: GFNCL) (NASDAQ: GFNCZ) today announced its consolidated financial results for the third quarter (“QE3”) and nine months (“YTD”) of the fiscal year ending June 30, 2011 (“FY 2011”). The consolidated results include RWA Holdings Pty Limited and subsidiaries (“Royal Wolf”), the leading provider of portable storage solutions in Australia and New Zealand, and Pac-Van, Inc. (“Pac-Van”), a key provider of modular buildings and mobile office units in the United States.
QE3 FY 2011 Results
YTD FY 2011 Results
- Total revenues were $43.3 million in QE3 FY 2011, a 12% increase over QE3 of the fiscal year ended June 30, 2010 (“FY 2010”);
- Leasing revenues were $22.8 million in QE3 FY 2011, an 18% increase over QE3 FY 2010;
- Leasing revenues comprised 53% of total revenues in QE3 FY 2011 versus 50% in QE3 FY 2010;
- Sales revenues were $20.5 million in QE3 FY 2011, a 7% increase over QE3 FY 2010;
- Adjusted EBITDA (1) was $9.2 million in QE3 FY 2011, an increase of approximately 19% over QE3 FY 2010;
- Adjusted EBITDA margin as a percentage of total revenues was 21% in QE3 FY 2011 versus 20% in QE3 FY 2010;
- Interest expense increased to $4.8 million in QE3 FY 2011 from $3.9 million in QE3 FY 2010; and
- Foreign currency exchange gains and other were $0.1 million for QE3 FY 2011 versus $0.6 million for QE3 FY 2010.
Key Financial Highlights
- Total revenues were $131.7 million in YTD FY 2011, a 17% increase over YTD FY 2010;
- Leasing revenues were $65.6 million in YTD FY 2011, a 14% increase over YTD FY 2010;
- Leasing revenues comprised 50% in YTD FY 2011 versus 51% in YTD FY 2010;
- Sales revenues were $66.1 million in YTD FY 2011, a 20% increase over YTD FY 2010;
- Adjusted EBITDA was $27.1 million, a 17% increase over YTD FY 2010;
- Adjusted EBITDA margin as a percentage of total revenues was 21% in both YTD FY 2011 and YTD FY 2010;
- Interest expense increased to $13.4 million in YTD FY 2011 from $11.8 million in YTD FY 2010; and
- Foreign currency exchange gains and other were $4.6 million in YTD FY 2011 versus $3.7 million in YTD FY 2010.
- When comparing March 31, 2011 with June 30, 2010, days sales outstanding in trade receivables improved to 41 days from 43 days at Royal Wolf and lengthened to 63 days from 53 days at Pac-Van, respectively;
- Inventories, excluding the effect of foreign currency translation into the U.S. dollar reporting currency, decreased by $1.8 million from June 30, 2010 to March 31, 2011;
- The utilization rate of the total lease fleet, on a unit basis, increased to 81% at March 31, 2011 from 79% at June 30, 2010;
- Net capital expenditures for the lease fleet were $15.3 million during YTD FY 2011 versus a negative $2.4 million during YTD FY 2010, reflecting the Company’s investment to meet the increasing demand in the Asia-Pacific area;
- During YTD FY 2011, outstanding borrowings, excluding the effect of foreign currency translation into the U.S. dollar reporting currency, were reduced by $6.2 million;
- On May 9, 2011, Pac-Van entered into an amendment to, among other things, waive noncompliance at quarter end of the senior leverage ratio covenant of its senior credit facility; and
- Trailing twelve-month (“TTM”) total revenues through March 31, 2011 were $175.1 million ($55.5 million in the United States and $119.6 million in the Asia-Pacific area) and, through March 31, 2011, TTM adjusted EBITDA was $35.4 million ($8.3 million in the United States and $27.1 million in the Asia-Pacific area).
(1) Earnings before interest, income taxes, impairment, depreciation and amortization and other non-operating costs and income (“EBITDA” and “adjusted EBITDA”) are supplemental measures of performance that are not required by, or presented in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). Adjusted EBITDA (which adds back share-based compensation expense) is a non-U.S. GAAP measure, is not a measurement of our financial performance under U.S. GAAP and should not be considered as an alternative to net income, income from operations or any other performance measures derived in accordance with U.S. GAAP or as an alternative to cash flow from operating, investing or financing activities as a measure of liquidity. We present adjusted EBITDA because we consider it to be an important supplemental measure of our performance and because it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry, many of which present EBITDA and a form of our adjusted EBITDA when reporting their results.