Rental Demand Up: Sunbelt Rentals Revenue Jumps 23% YOY

Sunbelt Rental storefront
Sunbelt Rental

Following a strong fourth quarter, Sunbelt Rentals posted a 23 percent increase in North American rental revenue for its 2022 fiscal year ending April 30. The U.S. division saw revenues of $6.477 billion, compared to $5.417 billion the previous year.  

Very strong demand coupled with ongoing supply constraints contributed to high utilization levels, the company said, citing changes in customer behavior to cut capital expenditures, accelerating the shift from ownership to rental.

Sunbelt Rentals’ parent Ashtead Group posted a 19 percent increase in total revenue and a 22 percent jump in rental revenue for its fiscal year ending April 30.

“I am delighted to be able to report a year of record performance for the Group.  We performed strongly across all geographies with rental revenue up 22% at constant currency (23% when compared with 2019/20),” said Ashtead’s chief executive, Brendan Horgan. This market outperformance across the business is only possible through the dedication of our team members who deliver for all our stakeholders every day, while ensuring our leading value of safety remains at the forefront of all we do.”

“Our business has demonstrated its ability over the last two years to perform in both good times and more challenging ones.  The new financial year has started well and the business has clear momentum.  We are well positioned to navigate the challenges and capitalize on the opportunities arising from the market circumstances we face, including supply chain constraints, inflation, labor scarcity and economic uncertainty, all factors which we believe to be drivers of ongoing structural change. The Board looks to the future with confidence.”

The company expects U.S. rental revenue to increase 13 to 16 percent year-over-year for the 2022/2023 fiscal year.

Investment and Acquisitions

As part of its strategic plan, Sunbelt invested $2.4 billion across existing locations and greenfields and spent $1.3 billion on 25 bolt-on acquisitions, adding 123 locations in North America during the 2022 fiscal year. Sunbelt aims to have 1,234 locations throughout the U.S. and Canada by April 2024.

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“This significant investment is enabling us to take advantage of the substantial structural growth opportunity that we see for the business as we deliver our strategic priorities to grow general tool and amplify specialty,” Horgan added. “We are achieving all this while maintaining a strong and flexible balance sheet with leverage at the lower end of our target range.”

Partners in Innovation

The 2022 fiscal year also brought multiple battery-electric partnerships for the rental giant. Sunbelt says it intends to be at the forefront of providing electric machines or vehicles to its customers.

Through a strategic partnership with Bobcat, Sunbelt will be the first national rental equipment company in North America to offer the T7X, the world’s first all-electric compact track loader. Sunbelt has secured the purchase of two-thirds of the first year’s all electric production. 

In addition, Sunbelt ordered 700 Ford Lightnings for its fleet. Slated to be delivered this summer, the purchase of the trucks contributes to Sunbelt Rentals’ goal of reducing greenhouse gas emission intensity by 35 percent by 2030.