Engquist concluded, “Our business performed well in 2012. As we move into 2013, we continue to invest in our fleet, expand our geographic footprint and strengthen our foothold in the industrial sector to leverage improving market opportunities. The extension in the bonus depreciation deduction should prove to be positive for our distribution business. Lastly, we recently completed a successful add-on notes offering of $100 million of 7% senior unsecured notes due 2022, which priced at 108.5% of par. This notes offering enhances our liquidity profile and was leverage neutral, with the proceeds used to pay down a portion of the senior secured credit facility. From operations to capitalization, our Company is well positioned for continued growth in 2013.”
FINANCIAL DISCUSSION FOR FOURTH QUARTER 2012:
Total revenues increased 15.3% to $250.1 million from $217.0 million in the fourth quarter of 2011. Equipment rental revenues increased 28.9% to $80.7 million compared with $62.6 million in the fourth quarter of 2011. New equipment sales increased 0.5% to $87.0 million from $86.6 million in the fourth quarter of 2011. Used equipment sales increased 49.6% to $29.5 million compared to $19.7 million in the fourth quarter of 2011. Parts sales increased 9.1% to $25.5 million from $23.3 million in the fourth quarter of 2011. Service revenues increased 7.6% to $14.9 million compared to $13.9 million a year ago.Gross Profit Gross profit increased 31.1% to $73.5 million from $56.1 million in the fourth quarter of 2011. Gross margin was 29.4% for the quarter ended December 31, 2012, compared to gross margin of 25.8% for the quarter ended December 31, 2011. On a segment basis, fourth quarter 2012 gross margin on rentals was 48.1% in this quarter compared to 44.5% in the fourth quarter of 2011 due to higher average rental rates on new contracts in the period and lower rental expenses as a percentage of equipment rental revenues. On average, rental rates increased 10.1% as compared to the fourth quarter of 2011. Time utilization (based on original equipment cost) was 71.8% in the fourth quarter of 2012 and 72.3% a year ago.