United Rentals 2019 revenues increase 16.2%; 2020 outlook shows growth in slower market

Marcia Doyle Headshot
Updated Feb 10, 2020

United Rentals Unir Img11Total revenues for United Rentals increased 16.2 percent in 2019 to $9.351 billion, with rental revenues increasing 14.8 percent to $7.964 billion.

For 4Q, total revenues increased by 6.5 percent to $2.456 billion and rental revenues increased by 3.7 percent to 2.062 billion. Commenting on the 4Q results, Matthew Flannery, CEO, says “Results were driven by growth in our core construction end markets, while challenges in our industrial verticals impacted both revenue and margins in the quarter.”

UR also released its 2020 outlook, saying it expects total revenues in the range of $9.4 to $9.8 billion. This “reflects the profitable growth we expect to deliver in what is forecasted to be a slower growth phase of this continuing cycle,” says Flannery. “We are well positioned to support our customers across the end-markets we serve, while remaining disciplined in our approach to capex.”

Used equipment disposal generated $831 million for the company during 2019, resulting in an adjusted gross margin of 46.7 percent, compared to an adjusted gross margin of 51.8 percent in 2018. The company says the year-over-year decrease was “primarily due to changes in the mix of equipment sold and channel mix.”

General rental income increased by 11.7 percent and 1.8 percent year-over-year on an actual and pro forma basis, respectively. Rental gross margin decreased 250 basis points to 38.8 percent. UR says this was primarily because of “the impact of acquisitions, notably higher depreciation of rental equipment for the acquisition of BlueLine, and higher operating costs, primarily higher repair and maintenance expenses.”

Rental revenue for the company’s Trench, Power and Fluid Solutions division increased 26.8 percent year-over-year. Rental gross margin decreased by 280 basis points to 45.4 percent, “primarily due to the impact of acquisitions,” says the company.