Mcgrath Rentcorp · NASDAQ:MGRC
Mcgrath Rentcorp — Q2 2024 Earnings Presentation
39 slides from Mcgrath Rentcorp's earnings presentation, Jul 25, 2024
Slide 1: Q2 2024 Quarterly Investor Presentation
JULY 25, 2024 Q2 2024 Quarterly Investor Presentation
Slide 2: Safe Harbor
Safe Harbor Statements contained in this presentation which are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, regarding McGrath’s (the “Company’s”) expectation
Slide 3: January 29, 2024 Announcement: WillScot Mobile Mini to Acquire McGrath RentCorp
January 29, 2024 Announcement WillScot Mobile Mini to Acquire McGrath RentCorp for $3.8 Billion, Enhancing Its Ability to Serve Customers in Turnkey Space Solutions Please refer to January 29, 2024 8-K filings, February 21, 2024 10-K, April 8, 2024 preliminary S-4 registration statement and special
Slide 4: McGrath Overview
McGrath Overview PAGE 4
Slide 5: Uniquely McGrath: Over 40 Years of Excellence
Uniquely McGrath B2B Rentals Modulars, Storage & Dividend Investor Focus Electronics Champion Shareholder 33 Years of Return CAGR 17%(c) Consecutive Increases Revenue North America $832M Focus Adjusted 99% of EBITDA $322M(a) (b) Total Revenues Diverse Customer Base Strong Service ~22,000 Customers C
Slide 6: McGrath Snapshot Q2 2024
McGrath Snapshot Q2 2024 Total Revenues $213M Total Adjusted EBITDA (3) $84M TOTAL REVENUES MARKET CAP (1) $213M ~$2.7B 16% 22% 11% DIVERSE CUSTOMER BASE EMPLOYEES 13% 65% ~22,000 ~1,200 73% (2) (2) Mobile Modular Portable Storage Mobile Modular Portable Storage TRS-RenTelco TRS-RenTelco (1) As of 7
Slide 7: Mobile Modular
Mobile Modular QUARTERLY REVENUES (Q2-24) $145M RENTAL EQUIPMENT (AT 6/30/24 OAC (1)) POSITIONING: A leading modular provider in North America $1,398M PRODUCTS: RENTAL FLEET (units) Office buildings and complexes, classrooms COVERAGE: Mobile Modular: servicing 35 states ~ 43,000 (1) Original Acquisi
Slide 8: Portable Storage
Portable Storage QUARTERLY REVENUES (Q2-24) $24M RENTAL EQUIPMENT (AT 6/30/24 OAC (1)) POSITIONING: A leading portable storage provider in North America $242M PRODUCTS: RENTAL FLEET (units) Portable storage containers, portable office, office and storage combos COVERAGE: Portable Storage: servicing
Slide 9: TRS-RenTelco
TRS-RenTelco QUARTERLY REVENUES (Q2-24) $33M RENTAL EQUIPMENT (AT 6/30/24 OAC (1)) POSITIONING: $368M A leading provider in North America PRODUCTS: RENTAL FLEET (units) 24,000 General purpose and communications test equipment ~ COVERAGE: Serving customers in North America and selectively overseas (1
Slide 10: Corporate Responsibility & Values
Corporate Responsibility & Values We take corporate social responsibility and fundamental good corporate citizenship seriously at McGrath Visit our corporate responsibility site for additional environmental sustainability, social responsibility and governance (ESG) information: https://investors.mgr
Slide 11: Financial Highlights
Financial Highlights PAGE 11
Slide 12: Q2 2024 Quarterly Highlights
Q2 2024 Quarterly Highlights Solid McGrath results reflecting impressive Mobile Modular performance • Total revenues $212.6M (+5%) • Adjusted EBITDA $83.7M (+9%) Positive Mobile Modular conditions (year over year) • Rental revenue growth (+10%) • Growth across commercial and education customer bases
Slide 13: Operating Results
Operating Results (dollars in millions) Six months ended June 30 Three months ended June 30 2024 2023 Change 2024 2023 Change Rental Revenue 241.5 228.1 6% 121.2 117.8 3% Rental Related Services 63.9 61.0 5% 34.4 33.9 1% Sales 89.5 71.5 25% 54.4 47.8 14% Other 5.5 6.2 -11% 2.7 3.5 -25% Total Revenue
Slide 14: Rental Revenue Quarterly Comparison (2023 – 2024)
Rental Revenue Quarterly Comparison (2023 – 2024) Mobile Modular(a) Portable Storage TRS-RenTelco +10% $100 $100 $100 76.5 78.0 $80 70.8 $80 $80 64.1 $60 -11% $60 -4% $60 $40 $40 $40 29.1 28.6 28.7 27.9 17.1 18.4 18.5 17.8 25.4 25.3 $20 $20 $20 $0 $0 $0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 MGRC +3% $
Slide 15: Adjusted EBITDA Quarterly Comparison (2023 – 2024)
Adjusted EBITDA (a) Quarterly Comparison (2023 – 2024) Mobile Modular(a) Portable Storage TRS-RenTelco +20% $60 53.4 $60 $60 43.3 44.5 -16% $40 32.4 $40 $40 -11% 20.6 21.5 21.9 20.7 $20 18.5 18.0 $20 10.0 11.5 12.3 11.0 $20 $0 $0 $0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 MGRC $160 +9% $120 95.3 87.9 83
Slide 16: Rental Segment Highlights
Rental Segment Highlights PAGE 16
Slide 17: Mobile Modular
Mobile Modular ae: McGRATH mobile KITCHENS TO GO" modular Pr ‘ymebemedular
Slide 18: Rental Assets
Rental Assets mobile modular ¥ 2's McGRATH PAGE 18
Slide 19: Modular Segment Total Revenues Q2 2024
Modular Segment Total Revenues Q2 2024 Mobile Modulars (a) Total Revenues $145M 1% 25% 74% (b) Rental Operations Sales Other (a) Mobile Modular includes Kitchens To Go and excludes Enviroplex (b) Other Revenue includes allocated revenues from Corporate for tenant income PAGE 19
Slide 20: Mobile Modular Operating Results
Mobile Modular Operating Results (a)(b) Total Revenues Rental Gross Profit Adjusted EBITDA $160 145 $60 $60 139 53 $140 %s of total of total 26% 47 37% 29% revenue 45 revenue $120 60% of rental $40 38 revenue $40 32% $100 20% 20% 54% $80 $60 $20 $20 $40 54% 51% $20 $0 $0 $0 Q2-23 Q2-24 Q2-23 Q2-24 Q
Slide 21: Rental Operations Revenue Customer Mix Q2 2024
Rental Operations Revenue Customer Mix Q2 2024 (a) Customer Mix Education Mix Commercial Mix Higher Education, 2% Other, 6% Entertainment & Retail, 1% Daycare/Other, 2% Recreation, 2% Education, 33% Health Care, 2% Private K-12/ Government, 3% Charter, 6% Transportation, 3% General Business, 4% Resi
Slide 22: Mobile Modular Highlights
Mobile Modular Highlights (a)(b) Rental Revenue Period End Rental Equipment (Original Cost) Average Utilization $100 $1,600 100.0% $1,400 76.5 78.0 1,222 79.4% 78.7% 79.3% 78.4% $80 1,189 80.0% 70.8 $1,200 1,130 1,106 64.1 $60 $1,000 60.0% $800 $40 $600 40.0% $400 $20 20.0% $200 $0 $0 0.0% Q1 Q2 Q1
Slide 23: Mobile Modular Highlights
Mobile Modular Highlights (a) Adjusted EBITDA(b) Adjusted EBITDA(b) % of Total Revenue Average Rental Rate(c) $60 40% 37% 3.00% 2.76% 2.76% 53.4 2.72% 2.66% 34% 32% 44.5 31% 43.3 30% $40 2.00% 32.4 20% $20 1.00% 10% $0 0% 0.00% Q1 Q2 Q1 Q2 Q1 Q2 2023 2024 (a) Includes Kitchens To Go, 2023 includes V
Slide 24: Mobile Modular Rental Revenue
Mobile Modular Rental Revenue (a)(b) Total fleet units on rent New Shipments Monthly revenue per unit Last Twelve Months Monthly revenue per unit +13% $1,200 $1,200 $1,124 $1,000 $995 +18% $1,000 $793 $800 $670 $800 $600 $600 $400 $400 $200 $200 $0 $0 Q2-23 Q2-24 LTM Q2-23 LTM Q2-24 $ per unit on re
Slide 25: Mobile Modular Initiatives
Mobile Modular Initiatives Mobile Modular Plus(a)(c) Site Related Services(b)(c) $20 $20 14.7 $15 $15 12.4 $10 8.5 $10 9.0 8.2 4.9 $5 $5 $0 $0 2022 2023 2024 2022 2023 2024 YTD June Rental Revenue YTD June Rental Related Services Revenues (dollars in millions) (a) Mobile Modular Plus includes rental
Slide 26: Mobile Modular Sales
Mobile Modular Sales (a)(b) Total Sales Revenues New Sales Revenue $100 $100 $80 $80 61 $60 55 $60 26% 27% 45 40 $40 $40 $20 $20 73% 74% $0 $0 YTD June 2023 YTD June 2024 YTD June 2023 YTD June 2024 New Sales Used Sales (dollars in millions) (a) Sales revenues include Kitchens To Go and exclude Envi
Slide 27: Portable Storage
Portable Storage ae McGRATH mobile p modular ® Portable PAGE 27
Slide 28: Portable Storage Total Revenues Q2 2024
Portable Storage Total Revenues Q2 2024 Portable Storage Total Revenues $24M 1% 5% 94% (1) Rental Operations Sales Other (1) Other Revenue includes allocated revenues from Corporate for tenant income PAGE 28
Slide 29: Portable Storage Operating Results
Portable Storage Operating Results Total Revenues Rental Gross Profit Adjusted EBITDA(a) $30 $20 -4% $20 25 24 16 15 6% 7% 86% 21% 19% 86% of rental 12 $20 revenue 11 74% %s of total 48% 73% revenue $10 $10 46% of total revenue $10 $0 $0 $0 Q2-23 Q2-24 Q2-23 Q2-24 Q2-23 Q2-24 Rents RRS Sales & Other
Slide 30: Portable Storage Highlights
Portable Storage Highlights (a) Rental Revenue Period End Rental Equipment (Original Cost) Average Utilization $20 18.4 18.5 $250 100.0% 225 228 17.8 17.1 208 200 80.8% 78.2% $200 80.0% $15 69.8% 66.1% $150 60.0% $10 $100 40.0% $5 $50 20.0% $0 $0 0.0% Q1 Q2 Q1 Q2 Q1 Q2 2023 2024 (a) See page 39 for
Slide 31: Portable Storage Highlights
Portable Storage Highlights Adjusted EBITDA(a) Adjusted EBITDA(a) % of Total Revenue Average Rental Rate(b) $15 50% 48% 5.00% 47% 44% 46% 12.3 11.5 3.94% 3.96% 11.0 40% 4.00% 3.71% 3.85% 10.0 $10 30% 3.00% 20% 2.00% $5 10% 1.00% $0 0% 0.00% Q1 Q2 Q1 Q2 Q1 Q2 2023 2024 (a) Adjusted EBITDA defined on
Slide 32: TRS-RenTelco
TRS-RenTelco PAGE 32
Slide 33: Rental Assets: Test Equipment Rental and Sales
Rental Assets Rental and Sales of General Purpose and Communications Test Equipment PAGE 33
Slide 34: TRS-RenTelco Operating Results
TRS-RenTelco Operating Results Total Revenues Rental Gross Profit Adjusted EBITDA(a) $30 $50 $20 $40 38 $15 22 33 $20 57% 23% 18 $30 20% 11 of total of total 55% 76% $10 9 revenue 77% revenue 29% $20 28% of rental revenue $10 $5 $10 $0 $0 $0 Q2-23 Q2-24 Q2-23 Q2-24 Q2-23 Q2-24 Rents RRS Sales & Othe
Slide 35: TRS-RenTelco Highlights
TRS-RenTelco Highlights (a) Rental Revenue Period End Rental Equipment (Original Cost) Average Utilization $40 $500 100.0% 398 387 29.1 28.6 $400 369 367 80.0% $30 25.4 25.3 59.2% 58.2% $300 60.0% 56.5% 56.5% $20 $200 40.0% $10 $100 20.0% $0 $0 0.0% Q1 Q2 Q1 Q2 Q1 Q2 2023 2024 (a) See page 39 for de
Slide 36: TRS-RenTelco Highlights
TRS-RenTelco Highlights Adjusted EBITDA(a) Adjusted EBITDA(a) % of Total Revenue Average Rental Rate(b) $30 70% 5.00% 57% 57% 55% 4.14% 4.16% 4.07% 60% 55% 4.03% 21.5 4.00% 20.6 50% $20 18.5 18.0 3.00% 40% 30% 2.00% $10 20% 1.00% 10% $0 0% 0.00% Q1 Q2 Q1 Q2 Q1 Q2 2023 2024 (a) Adjusted EBITDA define
Slide 37: Thank you for your interest and investment in MGRC
Company Summary McGrath (Nasdaq: MGRC) Established rental businesses with solid positions Strategic growth focus on Mobile Modular and Portable Storage Disciplined capital spending on new rental equipment and acquisitions Strong cash flow and resilient business model Dividend increases for 33 consec
Slide 38: Appendix
Appendix i: McGRATH
Slide 39: Definitions - Rental Fleet Metrics
Definitions - Rental Fleet Metrics Period End Utilization is calculated by dividing the cost of rental equipment on rent by the total cost of rental equipment excluding new equipment inventory and accessory equipment. Average utilization for the period is calculated using the average costs of the re