United Rentals (URI) 25 Jul 242024 Q2 Earnings call transcript

Good morning, and welcome to the United Rentals' Investor Conference Call. Please be advised that this call is being recorded.

Before we begin, please note that the company's press release, comments made on today's call and responses to your questions contain forward-looking statements. The company's business and operations are subject to a variety of risks and uncertainties, many of which are beyond its control, and consequently, actual results may differ materially from those projected. A summary of these uncertainties is included in the safe harbor statement contained in the company's press release.

XX, description the and Form the company's the ended complete please possible XX-K SEC. more as year to well refer annual December a of filings other these risks, for to For subsequent as with XXXX, report on

United information commitment to You that new to to subsequent publicly any filings revisions update statements or expectations. www.unitedrentals.com. Please these obligation in changes reflect no access the company's or has can at events, circumstances and forward-looking order website or on note Rentals makes no in release

also recent comparable You Please adjusted EBITDA. and terms presentations GAAP reconciliation the investor most EPS, references non-GAAP that such should call non-GAAP company's adjusted and refer note to measure financial release see to the company's to to each flow, the EBITDA from today's the press as back measure. financial cash free the include of

and Grace, now Speaking Flannery, you Matt today Officer; President Mr. Flannery. call I may will Executive United Officer. Flannery, begin. Ted Rentals for turn to Mr. Financial Chief and over the is Chief

joining you, for morning, and call. good everyone. Thanks operator, Thank our

the second you profitability, cash continues afternoon, we built with XXXX with line and upon returns As to quarter the with another as solid in saw the flow We're unfold pleased strong in start free quarter. expectations. our yesterday to growth, year our

with of our is in and call, on financials discussed our possible. On full gives for or in and the this a And drives strategy a value. built pleased the second best operational our the morning of for being key day, our we model last with work our me to the to that unwavering in our providing win generate over the our be safety, results, every before this. confidence our ahead. proposition we've and across what we'll these us diversified first Specialty I'll not course, for Rentals the value would results business will enables customer to Q&A. down guidance our on our discussing have focus approach, relationships XXXX the Today, this that innovation. whether as reiterated go-to-market partner critical that excellence And Our customers. the with we've a discuss doubled customers We've shareholder detail been investment we quarter is team's our quarter further XX,XXX-plus Without come commitment proof diligence will company of in is GenRent hard Ted steadfast And call results for and coupled marketplace. offering and in broadened expectations the discuss our and United opportunities decisions. far open serve up how continue then the decade I'm to employees,

with quarter start let's results. second the So

quarter rental X% by records. $X.X grew quarter second revenue discipline. adjusted another total increased margin this, within Adjusted record billion, by XX%, second Our of grew billion. year-over-year productivity by and Fleet a $X.X a supported X% billion, industry translating And to revenue grew to X% record. continued $X.X to quarter increased of almost X.X%, to EPS second both EBITDA to nearly $XX.XX, by

across Now GenRent our And continue both businesses. saw within activity. let's customer Specialty see to Specialty, growth turn to and We growth we product in all offerings.

XX% the fact, Specialty grew rental excluding year-over-year. Yak, In even of benefit

off track that in battery industrial us and markets, fan, Additionally, growth XX Freedom led be across our centers, at at quarter we remain cold a to and the open kicked By infrastructure. vertical, surprise excited we least utilities, nonres XX Specialty soccer opened puts both as multiple to It by particular you'll we strength will end come care, data health this Miami manufacturing. you're And on as well. with year-to-date, saw XX no and know we in projects that saw manufacturing if Park construction across year. in starts, new which

healthy, remains sell equipment still $X.X quarter the and market to billion expect remain to used of strong will the this believe generate allowing for a of us Additionally, year. demand second used OEC. record We around amount proceeds

CapEx. in second our we We in to with the fleet expectations in quarter Turning line spent as customer billion activity. $X.X added uptick meet to the seasonal

year-to-date, guide remains year, full the nearly For flow cash our $X.X free CapEx unchanged. billion. Subsequently, was

our cash drive coupled ability cash you've heard billion with see free year. generation a differentiator over support before, our flexible long-term and to to $X business enables confident remain shareholders. industry-leading profitability say continue creation as model our throughout our cycle for a me positive us this strong And to We key as and produce in value our flow

to Now We via shareholders million in share our quarter $XXX allocation. and buybacks the to turning capital dividend. returned

XXXX expected. balance originally to this excellent today shareholders The to is as nearly out sheet Our and in shape is year. continue you've to we that billion $X plan heard we consistently playing far return so is theme

from the with As guidance, in we this range keeping EBITDA business But and and look us year cash the midpoint while for free what and intact. flow step expectations our of remainder you gives let's revenue at saw of even further from CapEx narrowed conviction our unchanged updated out. the back

work unique of leveraging times. we myriad in we've diligent proposition remain many the tailwinds we our through value discussed First, as

for in energy large we've and been area of auto outlook an The all ship power infrastructure Data continue area. we and manufacturing, focus, vertical projects, well. as and will fact, has in construction center In win been to this also remain successful each positive.

business customers' problems. Rentals examples All solve of these are one-stop play more having of shop of of into we our United for our type help projects great as all accounted units and offering

data last we an center won. project recently month, I had a As example, visited large

systems, Specialty safety trench, core we're Safety providing control access dirt, the access with mind, and secured your addition advanced turnstiles site Training. to GenRent jump or with be to United to We're in that Beyond supporting that security educating might providing products workers Academy aerial, requirements. our their and our also and the power, immediately whether

to our and from logistics them differentiate Our to and nuts, soup help in relationship. ability us marketplace their the customer solve further experience allow us to strengthen

grow products. new to with continue we Second,

has by technology. existing their for accelerate investments work is to XUR the we acquisition now a ensure choice. Yak, The growth of over track. our a This the this this. customer X of example is progressing partner of leverage in to the and is family for months, United And we product. we relationships Our to is customers And finally, augmented Rentals well is enabled new we on which by part integration our culture make underway are with perfect of example our textbook been and how of can continue

across ourselves and investments in total fleet as repair to entangle customer-facing as us control aggressively invest allow allow drives scale And technology, size to that well enabling maintenance. Our and such thus when future and together, operating further to us customers, efficiencies as both technology management these task with put working telematics logistics, internal our and and growth.

how Ted, us shareholder I'll So Ted strong to wrap and over you. growth, our the our up, that questions. combined we're playing take to over to confident and XXXX value. And with free to business with advantages, extensive is things drive flexible call hand with before we compelling your happy competitive flow we're that, model allow profitable cash resilient out and

everyone. Thanks, good Matt, morning, and

execution, As record driving and EBITDA Matt as expected, EPS. out second highlighted, with and quarter QX played healthy strong revenue, demand

cash reflects midpoint the at free guidance reaffirm healthy year or flow another CapEx and returns continued delivering growth, confidence for total forward, EBITDA, cash of strong revenue, and significant our solid free Looking profitability, in flow.

allocating remain on capital shareholder As to prudently importantly, value. drive focused we

numbers. the into jump let's that, with So

or by revenue was rental by $XXX a X.X% productivity and X.X% inflation contributed supported Second partially of quarter rental, average billion. large offset while $XXX OER, revenues record Also XX.X%. were of fleet a verticals ancillary higher our That's and X.X% year-on-year added in million X.X%. X.X%. fleet rental projects. OER by Within Growth to $XX growth increase key million or in by revenue, re-rent or within fleet $X.XXX size assumed increased million

to Turning used our results.

margin that depth of a with we a record healthy expectations were strength levels. of OEC proceeds XX.X%. of XX%, quarter rate line sold recovery market evident the first in with quarter in second The a at quarter Second were million robust of fact the at $XXX adjusted in of amount and line

was flat rental $XX levels contribution as EBITDA ongoing the we've first of to at with to nonrental or $XX from larger business billion, adjusted a million Within used market the quarters. last was year-on-year, over finally, other And the increased million percentage SG&A sales $X.XX a reflecting business an of the to were and translating of to consistent ago used driven contributed a the record sales. EBITDA of $XXX year adjusted year-on-year. this, that but million $XX EBITDA several lines discussed a similar second rental headwind quarter Moving quarter, year-on-year. X.X%. increase EBITDA, were of Outside million by normalization

EBITDA at points adjusted with second to just was our XX.X%. at Looking compression the entirely almost of year-on-year margin due was discussed. in quarter I line used The dynamics basis profitability, XX expectations

X% Excluding of finally, CapEx, And earnings margin in $X.X implied our quarter share and adjusted our basis with the rental XX%. second gross second with line was impact historical a which billion, was record CapEx seasonality. just of to down used, is quarter to flow-through of XX forecast per $XX.XX. points our increased Shifting

Turning to returns cash flow. and free

weighted totaled remained of on cost return flow capital, cash of XX.X% while Our capital well average our free above billion. invested year-to-date $X.XXX

total leverage of to was of dividends of over distributed I'll record X.Xx strong And note the very reduced until our $X.X million liquidity add $XXX of tower via a including we since thereafter. shares add, billion. remains sheet year-to-date, million and almost this million $XXX by million count share maturities that have a balance continue net $XXX after has at Our this all and January. I'll June XXXX with long-term X.X through returning no to and very end shareholders repurchases.

updated results. let's year last confidence guidance another shared of which delivering our shift solid to in Now the reflects night, we

normally As maintaining metrics ranges for the previously EBITDA both do while for mentioned, the we and revenue we all this narrowing year. the of as time midpoints at are

our total revenue, X% of guidance specifics, billion just $XX.XX unchanged approximately I'll sold. terms growth In midpoint. to is of sales roughly a note $X.X used Within that our of OEC at $XX.XX this, proceeds revenue we've on billion over to billion, full total year billion range guidance narrowed of of for $X.X implying at

gross CapEx, range $X.X X%. importantly, we which flow we've return record this translates are adjusted free CapEx yield to I'll committed or EBITDA, $X.XX On are a to net per of unchanged. and returning shareholders guidance $XX current to cash billion. capital our And for of about to billion all $X.XX almost note still narrowed that a share billion year, the to

operator So please turn the open over with call Q&A. for Operator, the me the that, to let line.

David question from with ISI. Instructions] Evercore come Raso [Operator first will Our

you when said of The about out, question revenue growth GenRent year. relates this sort growth to interplay further Specialty. thinking beyond between of ear rental caught It kind the versus right, my

So XX% just in Specialty this has GenRent much And now widening. years over right, from X to flat pretty year-to-date, of thinking total right? quarter, about it's even revenues just gone the last XX%, rental

So of So that's if I'm math how trying is and of sort think X% XX%, the right, spirit it, fall GenRent Specialty GenRent of is long is can offset growing about question. the we're simple XX%. as still just can GenRent to could as Specialty Specialty right? the much fall XX%, flat,

implied it go of growing, in company in organically, I So of the back second Specialty probably offset the but Yak of we expect half. to has now right? X.X%, flatlining Because the in thinking revenues even some the revenues, X% context have in sort Specialties, in second half it, revenues you gen still growing half whole that negative the just know year we're In X% call of directly, the of do rental in guess kind I the it, rental XQ? those

go GenRent of about can speak kind trends? thinking Just you to the Specialty those ship? how we So curious carries negative expect you're and to Should that.

Matt. is This David. Sure,

certainly for much said, goal they local -- impacted is that not certainly pleased very more the quarters we're the tailored products. have are and market not about by organically business, don't broader right, with not negative. really penetration and And for the dynamics, our being with it's we those our business and but our our Yak it's Specialty going by our where we're to GenRent GenRent of to Specialty, market we needs. Specialty, to So that opposed think M&A, both as go predict growth That local goal segment, to with

have So on one-stop shop think that profile and when big a a but overall we advantage customer, to our of much we jobs sell higher Specialty's which is that can about big revenue. customers,

this most not I think starts. the into We So playing year, our for growth cold that's Specialty put CapEx us. really through you and that's of see dynamic and our unexpected could

Specialty, more where not room backfilling challenges GenRent we and for it's local just So by work is local impacting in know have tailwinds supported talked that the major we we've certain just it project some the certainly as about. penetration and the that Really so even as and was high of more activity for and Specialty. markets

think lag Well, now on also starting of Specialty, general to sort you rate well of to Specialty? to trying like from that's what in The are just through, underbelly the trying large to market some does figure pretty projects. Matt, the is as And how tethered the projects? visibility in is typical some I mega the slow much assume, now softness how right? I'm Everybody out, impact of

a And at we -- in up are the lot it's you're margin? bigger. same serve confidence see actually sort your Your mix Specialty your projects, right? Could shift the visibility that gross margins kind a helps So a to can higher lined show. in better mega the Specialty, of gross the time, carry in it's Specialty, like of

So better just mix that's and profile? given kind margin the GenRent does down being can offset how into that translate of actually a gross you

right? our we why years first reasons one first we now, units. XX continue on started we focus business Specialty this when almost to trench right, And the journey of there's and why ago Theoretically, absolutely, -- started

we well and only So still the you're fleet clarify of and demand way. our is as right coming. we're to GenRent in about I in what what businesses, is the we the make to right -- for our sure wanted have respond thinking to it demand all The customers need is thing

market. transition bit this to of not this to can our be Specialty coming a do in we year the but and tail guidance react there our so But a was we and So local of more expected transient January, going be entanglement. to in feel a the the we boon worry to year. that to this were be challenge get you about customer feeling demands the as market margins, have remember, that is year. we a that We'll was we'll end we if And certainly gave future local customers there when just

will question Wertheimer from with Research. next Our Rob Melius come

it's Thanks -- end And one big Matt, of are coming. gaining on in sort as for of your had it desire? guess down? kind outgrown a that's market is couple the Is Is in the a of of GenRent. what's the end are you I around saw you questions share? on you guys I just comments, So picture, of coming a around smaller the that still Is smaller going thinking down? market that well. looking was and share historically, strategy the And flat sort is market actually Are just that You little to gain about you've of bit now? flattish. flattening? what's the markets.

frankly, we certainly we market we're just definition, you'd certainly there share. have market that that in some But by local that down don't to are any the think share goals, giving but We believe business. are set don't up Yes. markets believe market

branches advance, through. Fortunately, in burden think I because that the didn't good you actually And think industry job we in we is managing with doing metrics through playing that fleet. see extra saw I this. are a the this those And

markets the for good. work that assets level fungibility in pleased flex some has support we're are every to our been of The our allows So of which really that really us that, there market, including with local growing. is

feel we gaining that the is on, set the don't customers targeted market share And don't we with any ceding focus certainly we're market we're we share. important most but So think we do thing share. goals,

part I just if I everything And up. Perfect. the GenRent, market else mean, and I the megas it follow is local then of some could but guess includes well. as

that's stop by curve lower by of that within talked kind the get this the forth? that from still that year, is the So so segment project or you more there. offset starts normal lull and rate does wave I'll going in rates those and projects interest of megas mega flowing about dynamics, still and

Yes.

we activity that we're area there, which if know imagine, supports about going and lots of talking the on the of because going local examples other going it. think market where But around be There's opposite, going And an activity an then gas not of going work we now, So local of activity, market and as projects you're the that market oil about continues is dynamic. extra gas we're to right feeder in right? probably to to struggle. there's there's when on lot oil including a the as all there's around can one in that, mega So growth, not plants. be you

we So a different we segmentation Rob, it market. ties, the look projects customers look at but than large at the we our do it, and in way local large

Our next Raymond question will James. come with from Tim Thein

Matt, the versus maybe total, was time time, about I reported fleet of inflation or that thinking and as going but back just rate obviously, comp the of coming fleet into could don't X%, But maybe hold specifically I'll the on to and component start flat that remember with forma were suggests the you year components kind that up comments a and/or of acting X%, headwind. pro and the GenRent expectation productivity some an a under just on 'XX. to revenues as GenRent closer in grew the if if

market discussed. given -- softness a your the just on the So local full maybe little expectation change just bit the for we've dynamics the -- of to any year, again, that

Yes. Sure, Tim.

fleet the forward. embedded kind of productivity do. that's correct, to did our we've guidance year, about year's component the to expectation trying that this able And is in look we with utilization talk as -- We is neutral, would memory been which right? match of what time that's your last time So make and

see think you that, an shows them when positive, through our we we that industry won't the which But lot qualitatively, would mix, and things. about and the to different continue continue a in a so rate guide. variability that's other discipline. And then news would is good output I qualitatively, that that we see peers, components January in are So great of that being of be give quantitatively. said we be to

a the we more So be are will productivity call year's achieve up good neutral, mix forecast last we utilization, fleet meaning guy end but which time about. and level in to able the time we would don't where it, we Rate I were with of variability to pleased component.

And pipeline. it. M&A international I'm just Got a M&A some what in the up of Okay. deals on X been you've then the the significance, prospects and noticed the story of the Has of last change maybe policy but just growth domestically, curious, more in comment just And on the potential terms how I've of then international thought given seen broadly? in a, tax changed the discussions And here? around pipeline one shaping process smaller is has never couple horizon, months.

Yes.

to you guys see can That's sweet to in The So years. of And it for in If robust, spot. I'll like look in get mean I have And good we our product growth, we've there. been right? shown really both we in businesses better then opportunity GenRent businesses. pipeline take and we there GenRent, of and build but strike that. a past be density and a network. new certain first because we've been we'll to couple our with more think a for -- that through offering owner There's activity capacity right, part We -- plenty has Yak, penetration overall, the there's even there. to is. more we we remains if a deal for And we be like primary. selling did need first. do of Specialty that's and market our the more prioritization -- Specialty know what had, continue then for a our

international, and recently did close thinking broad continues we about the pipeline be in a that robust. And deal So to Australia.

there was now, the team a the M&A right time we We run tool opportunity year. there. some business the may be offering there was for industrial doing existing markets into. international right some the story. Europe And get we to have able into play an day that yet, to little niche to with We're product our business that strictly not growth a of broaden growth, the the there great there all job. United and in a was of and right? a a last added And jump at end there definitely support to for in that small a I a great. the Australia but spend same and this think just the toehold X were there and organization. to have the of we saw some Australia. is their earlier And we a different fit tuck-in good have business opportunity this selling more bit team is our is with a to that there, We way the is earned really dynamic That supporting into that customers of selling year, of business target some Rentals that we

Jamie next will come Truist Securities. question Cook Our with from

to first we the I'm the why headwinds mean growth and are a with back wondering back top spend type that's -- need becomes sort with do wondering and can larger targeted a see with more incremental? of there point environment double-digit get need to question, term, which Specialty understand Ted, Rentals we its to of positive to getting I targeted just used a for line? what we of get to get -- the see the margins normalized but next some to single-digit these the my do incremental for the what targeted we some guess if XXXX range, acquisitions need United of integrated. used below of GenRent, we I'm to have versus sort of year we your easing your just incrementals? longer headwinds, I

question, Sure. Jamie. Thanks for the

lot goes into that incrementals. a obviously there's So

relative a matter, XX growing the right, or you that X, to the does say So versus matters volume. levels lot absorption. different obviously, if composition of without whether obviously, the growth want obvious or drives you But cost about obvious, think rate fixed saying growth XX of stating

And of kind what costs of so top that. drive need you kind to in of obviously say flow And consideration on of through. to it's growth there's hard the lift

If about you at looking we're overall. year, mid-single this healthy think think we what growth, is digits

point and You'd where, year making the that in about, important both technology. margins side we've cold flat to frankly, start a some we're on investments talked

illustrates importance So of that kind of the how you think about costs.

absolutely of where task making driving in ourselves discipline, we under easy. and margin depending So to conditions environments kind not easier some strong investments be lift cost can some you're or on as that

what we don't to profitability. on I an for So kind all say line through, possible efficient top that drive we attractive down but get I just incredible always growth what I have as driving is can we'll on and you to went to see focus want operations as reasons of need the know pinned have

will Jerry question from Revich next Our come Sachs. Goldman with

the XX% Specialty over about as growth that's willing above is assume to course talk comment? in I'm mix what And parts the of moved that? Specialty, are portfolio that average, the wondering can of if plan is that it fair a to you CapEx the of broad-based stronger the organic up the And How year? if has you're Matt.

Yak the right? for been the Specialty, growers, growth. Power leave Yes. But largest storage the now, is growing of can imagine said remarks, be opening the talked strong. let's Yak the growth that we to commitment business our offerings X about right? Sure, where even pleased, stand-alone have in years couple influence, And size aside the the I we all saw doubling and you without in continues growth that to Jerry. strong mobile my product XX% within across We're

seeing well. But we're it businesses trench in fluid and our as

I we the a it's big do good customers. points think sure large projects remarks, really this on lot on that board. unit I making accounted to And for And a helped And cross-sell opportunities and opening large that that's important. these also So selling And job I really Like of business prop. is I full the every drive growth. value in we're have we think the jobs. said think it that's across

then under Can you And pricing what been developments of that can Super. talk and months owned now? Obviously, opportunities folks for and business ownership? a have you've number about and you the surprises just any about advanced your just integration as on Yak, have tools logistics has talk the gone you how tools.

Yes.

So and really the to believe but the this what their network surprise, really a their not first We we to across this really acknowledge in our to table were surprise, team. pleased great space they product. And strong right, leader was customer distribute why of the growth ability fund our network, -- bring understand is base. a that our we our growth,

the customer in in a technology built in business. So they support some lot their already that were network -- they're have good, business we bringing grow our of and that a tools little bit capital constrained to help think logistics our for growth. in really and And frankly, and of

broken over well. to support next don't and quite need -- as I So doubling looking -- to a want just but more they forward this years the business good what at business. not this They Actually, they're do. we're X was

from Michael comes question next America. Feniger Bank with Our of

few there's Matt, obviously, some data the last construction weeks, nonres points economy. industrial negative been the in incremental around

have kept your of guys midpoint You guide. the

Are movement normal just Is than past? being of you from areas fleet than Some higher are fleet areas? stronger guys had revise that guys moving weak of you nimble, seen kind to incremental you to outlook. weakness? that in guys the more have observing their your peers Or

expected. we're play No, out seeing -- as as we seeing we're the year said,

large the any seeing been getting we've about been not know So I and and concerns, we're really go. questions come there's projects project and concerns mega flow,

"cancellations and flow So talk Miami was normal to opening talking holds." me or for time. that major about a the these remarks. in there's we one were long us. heard ebb of year, about is Remember, the stadium an last doing projects Soccer my You that been projects for We've

expectation So of bit a little maybe had built we that in. already

the of QX. with and pleased very we is back similar what we're in here pipeline, half year look we very had the But the going to to think

other once distance while. of our we've supporting we're for a network the this the we The fleet been got going been moving The we've project of of -- a within a have fact helps. assets I an and broadly fungible movement the area this like somewhere distributed density think any that fleet area. is most to need lot again, reasonable where But for we've part probably projects means actually a of

of model that business great helps think us logistics, So and I do why part the on it's scale and a matters.

one the add know tails people data or And looking I we think obviously, is everybody make heads I that thing When might struggle them. to at. is, Mike, there are with points And telling positive, about lot what And a continue our point be given that than us, have customers of us, a to to are that's tends data right? more telling to much volatility. they

customers talk our we that's our to the kind field, underpins we outlook. when to really talk of what and So

maybe that, Ted. a just And follow up with

this Just when -- cycle potentially with already local mega these downturns an in the been competition fill. you of projects on really some momentum filling cycle starts seeing of to easing project customers, into the like time to side? terms mega I'm a pipeline with your the with with few do continuing speak going and easing an or now sensitivity see that to markets some that as curious look pipeline rate takes that you what think you're to that quite easing cycle, up what seeing right where I'm backdrop takes curious there's your we're customers, a really in

I matters think is as our anything. as much thought sentiment

got anybody there's markets ago. to in if environment sure or so, equity calculate lag, certainly about the it, so look in and is the does That to number of of activity traded between X.X to market think cuts that the likely model certainly, looking year-end. even going to Fed and you months at rate anticipation a more probably the last X.X easing, U.S., you're the X.X how was right? discount about If cuts, expectation rate start But now effectively. the I'm started spur not trying that you at month And terms has how constructive a helps have credit

year, of funds. months. has Canada, point And started at They've the look Fed obviously, cut last Canada is point cuts sure X now of if you to seen, the north X.X X cut. has And I'm expectation get you're everybody to in in next in but going

about think the think capital I us direction thinking and to becoming customers encouraged you of So that economy, cost the more about they're of a positive. when is and

And any the I talked we've non-res of within that tailwinds about some would tailwinds. verticals that add we these softness are remember always Yes. expected backfill in multiyear that would

-- again, good for business local about. talked We've could up see got in of -- we've showing green a to will and long more assist cuts pipeline building start to think we this how type of that work and to you the shoots that takes that. it the regardless So do tailwinds Fed

Tami from come will JPMorgan. Zakaria question next Our with

XXX the wanted about So confirm. adding Yak and fleet to rest expect the But do we should that, be I of just year? to related there And earlier. to to for think to you expect is overall basis remain productivity seasonality points discussed about? to Or year? I time the question productivity, rate to for you utilization that positive still know Tim's mix

Tami, this is Yes, Matt.

We're going So out there that we call a of latter We're your separately there. part more. a question, to -- we little Yak. seasonality of to do be be that. to work to you're not -- have until quarter going each lot It could lap some going the to could on

January, the that team guidance. what's embedded we that's to and in we let question, do as expect to or something and we So that we'll be executing committed know quarter to see without And pleased fleet have as on to you this Yak. still in in was our with I'm it first productivity and what every really year. expectation, far is positive your That

Got it. One more question.

$XX For million used quarter, And quarter-to-date? second called out Have you of remained should in what this how the speak under sort equipment quarter, the margin from weakness think stabilized can XQ? you half the third or you're things much seeing in about versus we this headwind pressure? in to

Yes.

is So the I is just don't in 'XX continuing of market. extraordinary 'XX. the margin This characterized started as out in the that of coming to and weakness ongoing normalization a we've really period, think normalize function 'XX

At the $X.XX. selling historically, we've about assets. a $X.XX XXXX, the recovered In on Tami, to So high we as as $X.XX as said just that dollar got that reminder, time, of We much thought better-than-expected normalizing we and, in was storm obviously, unsustainable chain really that 'XX. demand process function the with the challenges. supply then that, perfect and of start a said would

of saw around where X in kind That's we've $X.XX something And $X.XX. mean we last the kind year, get of last that year. we'll You quarters. on this the revert bit. a little been got think We dollar

rate historical se. well it's also So think normalization. per it's don't Those we above this pressure think remain ongoing norms. margins We

you very So billion talked intra-quarter, $X.X would the on certainly, about We that. can guidance, of which but my $X.XX that OEC, comment about and billion prepared underpin $X.X we remarks, in in we see of proceeds about our good dollar. feel don't

those record another very rates the And there. demand market. So we'd say the a the held into and that sign in health think of reflect of been of has recovery We customer. demand. quarter second sold well amount strong frankly, our And that's very strength have OEC we of had I

from Our will Citigroup. come next Menges with question Kyle

part Tami's Following strong remainder of And used Specialty market of year? percentage remain just this a then, on will up mix what's the sales second as confidence and the you market, I new question of in the that noticed up the this the on used of giving picked question, that quarter. for the used

year a even and that's used new continue should to maybe and mix assume the we of that, the to that And remainder expect the positive we for XXXX? should margins? sales into So impact

So taking the question, first Kyle.

in customer I knowing that obviously business of big think what kind expectations, part with resulting activity line year-to-date is our of is. confidence a

expectations. back their confidence we're And as expectations them. you And we our would from in come of so there's looking that nothing to suggest ask own kind out customer deviating

we if certainly, we'd So saw a deviation why not. to ask questions there, start we're

think things the together to come used And our so views market. of those support I

natural kind that want forecast to to of with very of the been I into flow. pleased the a variable we don't terms results. trying mix, there's ebb one know In we've and get just or another, obviously, but

you'd about that bit? the age? could what's bring And little end you just comfortable little still Makes the target like at the sense. your fleet talk a if to Like fleet is a down And a of range bit where quarter? for age then

Sure.

months XX So I think quarter. we're in little the a over

COVID, peak it's versus probably that's I'll pre-COVID there that X you down a people there the couple So when -- are structural from XX, months. remind during of levels. look at of was that ahead period right was other One COVID X months. of Baker and X the added Finance, the that X.X added the of about the which month, about months acquisition changes acquisition General

very management months, So as mix, is for average if you structural in age fleet the is that XX, were of XX adjust to age risk talked comfortable. product really changes We've long more which about a to probably strategy. something

In downturn, It's a be to and able we'd just kind way hedge to flow. protect fleet months, to of age prospective the want ourselves a right? XX cash

decisions are we where fleet really point of feel could for very It's a we we're the But not to now an of in not engineer that So age fleet we given plan. output the like we months at comfortably trying the age. kind make. scenario, XX

helps, So like. in dig can don't if that deeper Kyle, there, I you'd if we know

Castillo Angel from Morgan Stanley. come will question with next Our

follow of some made and ability and just wanted your markets. some the fleet, I product I move maybe you to around guess, also on local just have to Matt, about comments up of with of kind your earlier that that you kind from away

you you ability a maybe of that markets? other in age good move impacted CapEx about lowering decision a the the versus that to I of the where unchanged unchanged. talk place spot kind your plus and perhaps what's bit the from think about keep age you the local as left being it have CapEx a you in kind product guess or the in at fact little can can -- -- perhaps to Just areas. you utilizing fleet And essentially having

Yes.

first, me let clarify. So

goal have opportunity We fleet leave fleet. What the thinking age that when is We no like to powder. always pointing that age was to place. your dry right at have to Ted about our we is

to we're to on expectation work. no dry have is because time our reason with that powder of And continuing it We team soon. use that any the the putting needing is CapEx

-- fleet productivity our from stated we to as earlier, is our guide, positive. the expected. as We can expect we've As you demand, be see

So try there's would customer's CapEx the future because growth really the not fleet we and business and our of is. warranted is why a forcefully to that's what cut in prospects CapEx believe because age then demand reason the we the

expect we CapEx right? the about billion to is of of sell. $X CapEx, And about X.X replace to is adjusted portion As inflation you that can big replacement we imagine, a And a imagine really talked is Specialty story the of for and within the feeding that's -- top primarily, good can CapEx to on then that, you of growth be growth which continues starts cold the us. a that,

utilization it will you kind half? versus term, in half kind first putting just of to there kind the and context normalized the a talk where of Very first of second were of we you've I it the on in versus helpful. also just you of longer half believe And just the Could clarify, was neutral kind basis around year. think maybe where kind discussion the for to second dynamic of essentially of remain, that in half about so

January we what said in Yes, maintained.

which goal rate forecast We we're utilization, is our don't by and -- not time to our good utilization, time level, a and our to And year's healthy guidance. last expect any numerically but match goal. will need able strong a at therefore, why see that going adjust don't remain to We got to half, see we're that's to really thoughts. it we reiterate our

come Fisher UBS. Our next with from Steven question will

round a the be active from seen you for or how And positioning providing visibility on different those next the far how like benefits of how have this or on what for are in bid variety those large so of projects pipeline Wondering or of just the anything you next the clearly is verticals your next so I'm duration year. much is think the we've projects? large So that? curious or point? do at to size maybe this year going projects terms projects

Steve. Yes,

XXXX. started these projects on right -- one in So equipment remind now think of people large I that we to is things have the key is

going long-lived are that projects. projects The these mega So are on.

of to this way And what's the of that. out some characterize and see work product think expect information. be probably and tailwind. that. But with That's multiyear we're really tailwind. to of relationships customers all we I into getting take a positioned is that well I that as once tailwind. think And multiyear view the I that multiyear this of all And this as would We're this advantage pipelines a competitive I are what's history this. that our good again, of hear type ground guys the the with coming broad we doing a offering bid see the So and or feel you We not expected.

embedded implied of Or in half to flow-through there logistics and QX the are second XX? in about think, And helpful. we to QX, how just flow-through versus XX the going That's in relative of to the should about fleet in from extra drove the then XX% year that ex compared used, that the around what Was in cold kind QX? starts think flow-through impact I costs QX to Okay. of XX% you the QX? redirect the curious have it reduction XX% the in

take one. Sure. Steve, that I'll

quarter-to-quarter, I'll remind of you, environment, And calculations. to this that's growth true. these certainly, a kind in just very of lot sensitivity So one, there's

guidance. reaffirmed saw We quarter. kind this quarter You we first delivered of profitability in-line and the

So this out playing expected. all is as

important I it's to start there. think

back second at ex to what in we it's going the in right? quarter, kind did that dissimilar half, to have you not look through the in used. mid-XXs what's You're If implied of flow

talked for We've margins having expectation -- the use the remains ex expectations. That that flat year. targeting was about the

part about talked are those making. investments talked making. we're we're of starts of We terms sequentially, In investments We it. cold technology about

back of programs the specifically on continues half. X that making progress is so kind in And it those that

with Our question Redburn. Neil next come Tyler will from

please. left, couple A

Ted. those suppose made, I shift that the done achieve there just fleet? that has slightly? or that return cold of And or altered intend being the channel intention cadence you of question touching the then anything the been in load achieve to maximize able or terms you've done on Just comments used around back second previous to always Is to it the to on the coming front to to was be question, used starts,

can Ted a some Neil, used But they in of I'll probably QX or right? So little more. bit start QX take was sale cold question the whether fell accelerated, talk and estate? more were So we co-locate real existing to that the they a in that. a right were pleased able estate function accelerate we find of, were real helped able to couple

manage way accelerated So that that we It's but we And estate not tremendously a the by so, little not bit, we probably some something by that's real a business quarter. capacity not had We to more. bit certainly try really the don't look little at really quarter. manage it.

schedule for So the is we and of ahead good and little about year. team the are a bit pleased our cold feel target on that starts

Yes.

On the used channel mix year year. retail last this than less for probably sales, there's a little

other to in selling. year, really XX% channels we averaged we'll capacity taking year, amount we're of we of advantage just as thereabouts. X/X. last think That's closer be OEC probably This ramp about I the

something billion I $X.X of of $X.X it this sold think vicinity. year, the year in be last will order in call billion that OEC, we

back in that back we've retail. coming other seeing about what distribution So getting we'll that take advantage X/X years. to of you're in some really held is XXXX of through ultimately, channels But normal on prior

next Our from Scott Oppenheimer. question come will Schneeberger with

the market, bit That's tailwind for challenging. of talked Matt, project, of nice guess, for we've more smaller I on Interest you obviously projects. you. about a little -- mega sensitive kind end rate a

We a customers? from are that kind seeing of a improving anticipate small do Bill And you year-over-year that funds -- status quo you how the degree you haven't projects? how the from pickup can that large from that. influencing sense is really flowing And you in and your Have to that flow and the or discussed 'XX year-over-year? Infrastructure

Yes.

was So the to business our started time -- fleet we talked been think the in serve the while, I infrastructure we a needed infrastructure for our XXXX, to when has to about growing right? bolster acquisition start about needs. first we talking Neff

to coming. do think be we this. We So on long that more work there's are

to almost pleased opinion. to predictable it's And to it's our weekend infrastructure we funding my Some when a -- opportunities. think track lot out. see about I see in around I gear I the in coming of projects. is on But continuing are this shoots hard and of more drove than seeing was bridge green and postmortem road around

all on been that's So the we -- you travel. going I as think about airport work and see

good to say that's I date. feel opportunity do that's in on I'd than been infrastructure. we do more gone think the funding early still So -- this. we're about there's innings of up ahead

of year-over-year, comp? going the ancillary Ted, then, And might It might quick, last Or just contribution may comp there real that nice real the as X% be more But re-rent the simple simple be in But this year. that. from it easy kind quarter, a real on? second anything from question. is special just Appreciate is of answer. and be

In from and terms re-rent? growth the of ancillary

Yes.

got revenue. thing the piece, Yak, more Yak, is So re-rent a and different when And biggest ancillary of of kind we from which bought the They've slightly traditional they've and ancillary got then composition revenue. the Yes, the we specifically. talked right? a bigger portion about OER revenue of is more rental coming

That You being substantially Yak. heard XX.X%. the that in my remarks, up impact of prepared reflects

Capital Newman will last Our come with Ken from Markets. KeyBanc question

utilization. mean, Maybe can into give you but just I real don't know time dollar I back quickly, ut, we

just seen utilization I obviously, has decade here? maintained it, since mix we how last, the ut here back much know expansion implies to been call getting there the in the think more that guide you on is that Specialty back a But haven't for I positive XXXX. we're am dollar now. dollar think high from driver from headroom curious for half And I

don't Ken, the utilization, basis. you, with we do honest aggressively dollar be it's manage of combination on a which time, really we To right? daily So focus very and on rate

look we certainly really the but that ways, don't both way, is So mix component do at way. by a it think we

are return, necessarily acquisition, The would but We the assets dollar have dollar high from not help as that that certainly Yak revenue got we as high summer ut. ut well.

productivity. help it how fleet to similar So

returns, think lift. should and help the to continue it, that to it. way to been drive that's we But components a but duck we opposed really of manage certainly as So it's individual opportunity not the there's business the

was to question half kind just want the beginning negative necessarily second we've be expectation Got is to be that to that and to follow-up, you're that expected. mean half of growth second going versus know similar is the the the Q&A at asked Maybe session. as of for see that it. clarify -- GenRent -- I a I To the my first Specialty we The clarify, just is in it growth But year-over-year. that expecting the not the GenRent seen between is decoupling half? I probably

business It a for has of been faster the while. other Specialty products a of And for services. growing been the that and of part businesses. So the is it these is than while, of many right? maturation added our has Part overall

So base. -- to to cross-sell to continue ability and our customer existing our and improve

look if long-term So and been would overall company the goals, our to I And the would continue we it, that's of Specialty expect state driver outpace to say to growth. even we that. you out

and cross-sell, to ability that broadly customers expect our these show serve results. good we'd really So about to we and to feel type continue of

back I closing this like Flannery would call additional Matt At for or the turn to time, to any remarks.

today. you Great. everyone the call, I'm on we time. Thank and appreciate could operator glad to your join you, us

Our the has latest update. QX investor deck

to at look answer is a it. take you please as And So Elizabeth always, any have. questions available

we talk stay safe until take in again and care. October, So

participation. conclude We your today's does call. you This thank for

time. any You at may disconnect