02.11.2009

United down 32%

US based United Rentals has reported third quarter revenues of $592 million, down 32 percent on the same period last year. Rental revenues declined 30 percent to $478 million.

While revenues continue to decline, the company managed to post a pre tax profit for the period of $4,000 down from $117 million for the third quarter 2008.

Total year to date revenues were down 27 percent to $1.8 billion but reported a pre-tax loss of $58 million, compared to a profit for the same period last year of $252 million.

United generated $123 million of cash during the quarter compared with $20 million last year. The company now expects to generate around $350 million of free cash flow for the full-year 2009, an increase from its previous estimate of $325 million.

The company also managed to cut its total debt by $73 million during the quarter. The company says that time utilisation decreased 3.8 percent age points to 64.2 percent, while rental rates declined 11.8 percent, compared with the third quarter last year. Dollar utilisation dropped 12.2 percentage points to 48.7 percent.

Chief executive Michael Kneeland, said, "We are making progress on key areas of the business that are within our control, despite the further deterioration of activity in most of our end markets. Our continued focus on costs was instrumental in reducing SG&A expense and cost of rentals, and we now expect our free cash flow to come in higher than previously projected for the full year”.

“Rental rates, while down year over year, showed a sequential improvement from the second quarter. From our current vantage point, our expectations for the timing of the cycle remain unchanged. We are planning for a modest recovery late in 2010, with demand building gradually throughout 2011 as lending resumes for non-residential construction projects”.