Willscot Holdings Corporation · NASDAQ:WSC
Willscot — Q1 2019 Earnings Presentation
29 slides from Willscot's earnings presentation, 2019
Slide 1: Quarterly Investor Presentation First Quarter 2019
Quarterly Investor Presentation First Quarter 2019 1
Slide 2: Safe Harbor
Safe Harbor Forward Looking Statements This presentation contains forward-looking statements (including the earnings guidance contained herein) within the meaning of the US Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended. The words
Slide 3: Temporary space solutions are our business
Temporary space solutions are our business. Everything about our company, from our expert staff to our turnkey solutions to our network of locations, is designed to make it easier for customers to make one call and get a complete, immediately functional temporary space solution. Our solutions are Re
Slide 4: Compelling Specialty Rental Growth Platform
Compelling Specialty Rental Growth Platform Delivered $84.5M of Adj. EBITDA(1) in the first quarter; on track to deliver $345 – $365M of Adj. EBITDA(1) in 2019 and $400M run-rate heading into 2020 1 Delivered $255.0 million of Revenue in Q1, an YOY pro forma(2) U.S. Modular Space AMR growth 89.2% in
Slide 5: WillScot at a Glance
WillScot at a Glance Established Brand with Strong Legacy of Innovation Key Differentiating Attributes Specialty rental services market leader providing modular space and portable storage solutions to diverse end markets across North 1 America for over 60 years Customers value our solutions; • Pro f
Slide 6: Accelerated Strong Organic Growth with Accretive M&A
Accelerated Strong Organic Growth with Accretive M&A Recapitalized Company and Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 closed Business Adj. EBITDA Adj. EBITDA Adj. EBITDA Adj. EBITDA (1) (1) (1) (1) Combination Adj. EBITDA(1) of (Nasdaq:WSC) up up up up $84.5 up with Double Eagle 32.5% YoY 45.5% YoY 100.6% Yo
Slide 7: Q1 Results Demonstrate Contribution From Organic Lease Revenue and Synergy Realization
Q1 Results Demonstrate Contribution From Organic Lease Revenue Combined with Significant Synergy Realization Q1 Adjusted EBITDA(1) Walk US$m ▪ Q1 2019 Adj. EBITDA(1) up $24.9 million, or 17.6 84.5 41.8%, year over year as compared to Q1 7.7 2018 pro forma Adj. EBITDA(1) 7.3 17.6 24.1 59.6 7.3 • Real
Slide 8: Our Core Leasing KPIs in the US Remain Strong
Our Core Leasing KPIs in the US Remain Strong Modular - US Segment Pro forma(1) Results 577 AMR / UOR (US$) Modular Space 508 459 wth ▪ Pro forma(1) monthly rental rates up 13.6% year over Gro oY year %Y 13.6 • Driven by expanding Ready to Work (VAPS) penetration and WSC Price Optimization Tools 1Q1
Slide 9: VAPS Revenue Growth Approx $140 Million Over Next 3 Years is Achievable
VAPS Revenue Growth Approx $140 Million Over Next 3 Years is Achievable VAPS Monthly Rate(1) VAPS Future Revenue Potential(1) US$ 93.3K 12 d Units(1) + $123 + mo. = $137M Delivere p 2 1% Rates u Yo Y • Delivered rates continued $123 to increase in Q1 2019 across the combined 260 $260 delivery volume
Slide 10: Diverse End Markets Continue To Support Growth In 2019
Diverse End Markets Continue To Support Growth In 2019 ARA Rental Industry AIA Consensus Construction Forecast(2) ABI Revenue Forecast(1) Architectural Billing index (ABI) has remained Overall above 50 for 23 of the last 24 months Commercial/ nonresidential Institutional 5% CAGR Industrial building
Slide 11: Financial Review
WILLSCOT Financial Review
Slide 12: Strong Q1 Organic and Inorganic Growth
Strong Q1 Organic and Inorganic Growth Revenue (1) (US$m) Adj. EBITDA (1) (US$m) ▪ Revenue of $255.0 million is up 89.2% owth th YoY Gr oY Grow year over year driven by a 84.9% 89.2% 138.0% Y 255.0 84.5 increase in our core leasing and service 23.5 7.7 revenue driven by increased volumes from acquis
Slide 13: Reconciliation of Non-GAAP Measures – Adjusted EBITDA
Reconciliation of Non-GAAP Measures – Adjusted EBITDA Three Months Ended March 31, Consolidated Adjusted EBITDA (1) Reconciliation 2019 Explanation of Reconciling Adjustments (US$ in thousands) Total Income (loss) from continuing operations (11,161) Income tax benefit 378 Loss from continuing operat
Slide 14: Synergy Realization and Cost to Achieve
Synergy Realization and Cost to Achieve Synergy Run Rate Integration & Restructuring Costs Real Estate Proceeds US$m 75 71 71 62 15 44 40 ~40% 80% 30 realized 60 incurred/ in Q1 expended 27 Original Current Original Current Original Current Expectation State Expectation State Expectation State Reali
Slide 15: Modular - US Segment Fundamentals Remain Strong
Modular - US Segment Fundamentals Remain Strong As Reported Pro Forma(2) Modular Space(1) Average Units on Rent (in thousands) Modular Space(1) Average Units on Rent (in thousands) 84.5 86.4 84.7 86.1 84.5 86.0 87.0 86.9 87.0 87.2 86.4 68.0 74.9% 75.3% 72.4% 74.8% 70.6% 73.9% 71.8% 72.4% 69.4% 48.7
Slide 16: Modular – US Segment Quarterly Performance
Modular – US Segment Quarterly Performance Revenue (1) (US$m) +5.5% YoY PF(2) ▪ Modular - US segment revenue increased 274 89.6% to $231.5 million as compared to 241 76 220 223 219 233 233 231 $122.1 million in the prior year quarter 137 108 198 122 119 ▪ Modular space monthly rental rates 97 111 in
Slide 17: Modular – Other North America Quarterly Performance
Modular – Other North America Quarterly Performance Revenue (1) (US$m) Modular Space AMR / UOR (1) (US$) 29 30 29 26 13 27 25 16 25 13 24 24 14 6 13 12 576 573 571 587 581 564 557 555 557 552 534 536 541 546 530 527 16 24 24 21 17 12 12 13 13 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 17
Slide 18: Q1 2019 Results Q2-Q4 2019 Outlook
Reiterating Free Cash Flow nd Outlook - Expectations Significantly Higher in 2 Half 2019 and 2020 Adj EBITDA to Free Cash Flow Walk(1) ▪ Q1 free cash flow results consistent with our expectations for the full year US$m ▪ Adj. EBITDA favorable to expectations due to Q1 2019 Results 84.5 variable cost
Slide 19: Debt Structure Provides Significant Flexibility
Debt Structure Provides Significant Flexibility Carrying value outstanding at (in thousands, except rates) Interest rate Year of maturity March(1)31, 2019 2022 Secured Notes 7.875% 2022 $ 292,674 2023 Secured Notes 6.875% 2023 294,123 Unsecured Notes 10.000% 2023 198,969 US ABL Facility Varies 2022
Slide 20: Compelling Specialty Rental Growth Platform
Compelling Specialty Rental Growth Platform ü Market Leader with Significant Scale Advantages ü ü Diverse Product Proven and Experienced Offering, Industry Veteran End-Markets and Management Team Customer Base ü ü Track Record Delivering Attractive Unit on Organic and Economics on Long- Inorganic Gr
Slide 21: Appendix
WILLSCOT jp delitelbs
Slide 22: Summary P&L, Balance Sheet & Cash Flow Items
Summary P&L, Balance Sheet & Cash Flow Items Key Profit & Loss Items Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 Modular - Other Modular - Other (in thousands, except rates) Modular - US North America Total Modular - US North America Total Leasing and Services Modular Leasing
Slide 23: Reconciliation of Non-GAAP Measures – Adjusted EBITDA
Reconciliation of Non-GAAP Measures – Adjusted EBITDA Adjusted EBITDA is a non-GAAP measure defined as net income (loss) before income tax expense, net interest expense, depreciation and amortization adjusted for non-cash items considered non-core to business operations including net currency (gains
Slide 24: Summary Consolidated Supplemental Pro Forma Financial Information
Summary Consolidated Supplemental Pro Forma Financial Information Pro Forma(a) Combined Three Months Ended Three Months Ended March 31, March 31, 2019 vs. 2018 (in thousands) 2019 2018 $ Change % Change Revenue 255,008 244,093 10,915 4.5% Net loss (a) (11,161) $ (13,706) 2,545 Other Financial Data:
Slide 25: Reconciliation of Non-GAAP Measures – Pro Forma Adjusted EBITDA
Reconciliation of Non-GAAP Measures – Pro Forma Adjusted EBITDA Pro Forma Three Months Combined Three Ended March 31, Months Ended (in thousands) 2019 March 31, 2018 Historical WillScot net loss $ (11,161) $ (6,835) Pre-acquisition ModSpace net income — 941 (a) Pro forma adjustments to net loss — (7
Slide 26: Reconciliation of Non-GAAP Measures – Adjusted EBITDA Margin %
Reconciliation of Non-GAAP Measures –Adjusted EBITDA Margin % Adjusted EBITDA Margin is a non-GAAP measure defined as Adjusted EBITDA divided by Revenue. Management believes that the presentation of Adjusted EBITDA Margin % provides useful information to investors regarding the performance of our bu
Slide 27: Reconciliation of Non-GAAP Measures – Net CapEx
Reconciliation of Non-GAAP Measures –Net CapEx Net Capital Expenditures ("Net CAPEX") and Net CAPEX for Rental Equipment are defined as capital expenditures for purchases and capitalized refurbishments of rental equipment and purchases of property, plant and equipment (collectively "Total Capital Ex
Slide 28: Reconciliation of Non-GAAP Measures – Free Cash Flow
Reconciliation of Non-GAAP Measures –Free Cash Flow Free Cash Flow is a non-GAAP measure. Free Cash Flow is defined as net cash provided by operating activities, less purchases of, and proceeds from, rental equipment and property, plant and equipment, which are all included in cash flows from invest
Slide 29: Capital Structure as of March 31, 2019
Capital Structure as of March 31, 2019 Outstanding as of March 31, 2019 Class A Common Shares 108,693,209 Class B Common Shares(1) 8,024,419 Total Common Shares 116,717,628 Shares Underlying 2015 Warrants 12,183,933 Outstanding warrants represent 22.2M Shares Underlying 2018 Warrants 9,999,579 share