Willscot Holdings Corporation · NASDAQ:WSC
Willscot — Q1 2018 Earnings Presentation
30 slides from Willscot's earnings presentation, 2018
Slide 1: Quarterly Investor Presentation First Quarter 2018
Quarterly Investor Presentation First Quarter 2018
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains statements about future events and expectations that constitute forward-looking statements. These statements can be identified by our use of the words “believes”, “expects”, “projects”, “should” or similar words. The forward-looking statements he
Slide 3: Operating Highlights
Operating Highlights • Core business very strong in Q1 Rental Business • Tank & Pump rental revenues up 21.7% with robust utilization and healthy pipeline Growing • North American Storage Solutions activations were up 11% • North American 2018 economic indicators are strong Favorable End-Market • Th
Slide 4: Financial Highlights Q1 Results
Financial Highlights Q1 Results(1) • Total rental revenues up 13.4% from Q1 17 – Storage Solutions +11.5% Rental Revenue Growth(2) – Tank & Pump Solutions +21.7% • Storage Solutions rental rates increased 3.0% year-over-year; new rates increased 0.9% • Storage Solutions average units on rent during
Slide 5: Diversified Company with Strong Customer Focus
Diversified Company with Strong Customer Focus Geographically Diversified Diversified Customer Base (1) Other Oil & Gas 6% 2% Tank & Pump Retail/ Solutions Gov't & Consumer North America Institutions Services 19% 6% 24% Industrial/ Commericial Storage Solutions 23% Construction North America 39% Sto
Slide 6: Earning Customer Loyalty
Earning Customer Loyalty Consistent World-Class NPS (1) Customer Effort Score (1) 85% 85% 84% 85% 87% 85% 84% 86% 80% 9.2 9.4 9.3 9.3 9.3 8.6 8.7 8.7 8.7 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Ask the Customer… • Net Promoter Score
Slide 7: Active Rental Fleet Management
Active Rental Fleet Management Storage Solutions Tank & Pump Solutions Average Unit Utilization Average OEC Utilization 71.8% 75.7% 73.6% 73.0% 69.0% 70.6% 69.4% 66.6% 61.9% 64.5% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018 2017 2018 Average Rental Fleet in Units (in thousands) Average OEC Fleet Inventory (in
Slide 8: Driving Rates With Premium Products and Services
Driving Rates With Premium Products and Services Storage Solutions Year-Over-Year Rate Change 28-Day Rental Yield Bridge Q1 17 to Q1 18 4.2% $215 $4 $5 $198 $4 $4 2.9% 2.9% 3.0% 2.6% 2.6% 2.3% 2.4% 1.6% Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q1 2017 Rental Rate Ancillary Trucking Curr
Slide 9: Financial Review
Financial Review 9
Slide 10: Revenue Highlights
Revenue Highlights Total Revenues Rental Revenues (in millions) (in millions) $146.7 $140.7 $138.5 $136.6 $132.3 $127.7 $123.5 $126.7 $117.9 $114.7 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018 2017 2018 Total Revenues Bridge Q1 17 to Q1 18 • First quarter rental revenues increased 13.4% from Q1 17 (in millions
Slide 11: Profitability
Profitability Adjusted EBITDA (in millions) • Total adjusted EBITDA of $48.6 million, margin of 34.5%, up 80 bps $55.6 from prior-year quarter $48.6 $45.5 • Storage Solutions adjusted EBITDA of $40.6 million $41.7 $42.0 – Up 10.3% from prior-year quarter (adjusted for FX) – Margin of 35.7%, up sligh
Slide 12: Efficiency and Performance Update
Efficiency and Performance Update Number of Employees at Period End • Rental, Selling and General Expense up $11.0 million, 2,020 2,026 2,048 2,044 2,008 $9.5 million adjusted for FX, compared to Q1 17(1) – Higher transportation and salary costs due to increased activity – Increased variable compens
Slide 13: Performance by Segment: North American Storage Solutions
Performance by Segment North American Storage Solutions Total Revenues Rental Revenues (in millions) (in millions) $97.9 $91.6 $92.9 $89.0 $86.6 $81.0 $81.8 $84.3 $75.6 $76.5 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Adjusted EBITDA Unit Utilization (in millions) $39.7 73.8% $33.7
Slide 14: Performance by Segment: United Kingdom Storage Solutions
Performance by Segment United Kingdom Storage Solutions Total Revenues Rental Revenues (in millions) (in millions) $22.6 $22.2 $21.2 $21.6 $20.3 $20.2 $19.9 $20.3 $18.2 $19.0 £17.3 £16.4 £16.6 £16.3 £15.9 £14.7 £14.8 £15.5 £15.0 £14.6 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 USD G
Slide 15: Performance by Segment: Tank + Pump Solutions
Performance by Segment Tank + Pump Solutions Total Revenues Rental Revenues (in millions) (in millions) $27.2 $26.9 $25.0 $25.7 $25.5 $23.7 $23.2 $22.2 $22.4 $20.9 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Adjusted EBITDA OEC Utilization (in millions) $8.4 $8.0 73.0% 73.6% $6.4 $6.
Slide 16: Free Cash Flow Generation and Capital Investment
Free Cash Flow Generation and Capital Investment Free Cash Flow Capital Expenditures (1) (in millions) (in millions) $79.2 $23.7 $71.6 $70.0 $18.8 $18.2 $14.9 $8.9 $15.8 $16.1 Q1 Q2 Q3 Q4 2014 2015 2016 2017 2018 2017 2018 PP&E NET CAPEX Fleet NET CAPEX • Q1 18 free cash flow of $18.8 million • Q1 1
Slide 17: Debt Profile at March 31, 2018
Debt Profile at March 31, 2018 Scheduled Debt Maturities Total Debt and Leverage Ratio (in millions) (debt in millions) 5.0x 5.0x 5.1x 5.0x 4.9x 4.9x 4.6x 4.8x 4.8x $631.9 $946 $954 $942 $940 $943 $10.1 $915 $937 $937 $926 $621.8 $253.0 $3.0 $250.0 $6.4 $8.7 $9.8 $8.5 $6.6 $0.6 '18 '19 '20 '21 '22 '
Slide 18: Evergreen Financial Model
Evergreen Financial Model Performance Metric Long-term Targets Rental Revenue Growth GDP plus 2 to 3% Adj. EBITDA Growth > 60% Flow-Through Adj. EBITDA Margin > 40% ROCE > WACC Dividends Grow at 10% per annum Net Debt/Adjusted EBITDA < 4.0x Model reflects our goals over a lon
Slide 19: 2018 Outlook
2018 Outlook Revenue expected to exceed Evergreen Model Target Robust pipeline in Storage Solutions Demand in Tank + Pump Solutions remains strong, momentum is continuing Flow-through anticipated to exceed 60%, leading to improved adjusted EBITDA Margin Leverage ratio and Return on Capital
Slide 20: Market Leader in Leading Storage Market
Market Leader in Leading StorageMarket Solutions and aPosition LeadinginProvider of Tank & Pump Solutions Deep and Strong Brand with Strong Brand Experienced Superior Products with Premier Management and Premier Service Service Offering Team Offerings Significant Significant Asset Asset Coverage Div
Slide 21: Appendix
Appendix 21
Slide 22: Non-GAAP Financial Information
Non-GAAP Financial Information In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company also discloses in this press release and accompanying presentation certain non-GAAP financial information. These finan
Slide 23: Reconciliation of net income to EBITDA and adjusted EBITDA
Reconciliation of net income to EBITDA and adjusted EBITDA (in millions and includes effects of rounding) 2017 2018 LTM Q1 Q2 Q3 Q4 Q1 Net income $ 10.2 $ 8.8 $ 11.2 $ 92.1 $ 14.9 $ 126.9 Interest expense 8.4 8.8 9.2 9.3 9.6 36.9 Income tax provision (benefit) 5.3 4.6 6.4 (64.4) 4.9 (48.5) Depreciat
Slide 24: Reconciliation of net cash provided by operating activities to EBITDA
Reconciliation of net cash provided by operating activities to EBITDA (in millions and includes effects of rounding) 2017 2018 LTM Q1 Q2 Q3 Q4 Q1 Net cash provided by operating activities $ 32.7 $ 30.5 $ 32.6 $ 39.8 $ 34.9 $ 137.9 Interest paid 13.7 4.5 12.2 4.7 12.3 33.7 Income and franchise taxes
Slide 25: Reconciliation of net cash provided by operating activities to free cash flow
Reconciliation of net cash provided by operating activities to free cash flow (in millions and includes effects of rounding) 2017 2018 LTM Q1 Q2 Q3 Q4 Q1 Net cash provided by operating activities $ 32.7 $ 30.5 $ 32.6 $ 39.8 $ 34.9 $ 137.9 Additions to rental fleet, excluding acquisitions (10.0) (13.
Slide 26: Reconciliation of net income to adjusted net income (Q1 2018)
Reconciliation of net income to adjusted net income (1) For the three months ended March 31, 2018 (in millions, except per share data and includes effects of rounding) Statement of Statement of Operations Restructuring Operations As Reported Expense (2) Adjusted Revenues: Rental $132.3 $132.3 Sales
Slide 27: Reconciliation of net income to adjusted net income (Q1 2017)
Reconciliation of net income to adjusted net income (1) For the three months ended March 31 2017 (in millions, except per share data and includes effects of rounding) Statement of Acquisition- Statement of Operations Related Executive Restructuring Operations As Reported Expenses (2) Severance (3) E
Slide 28: Constant Currency Calculations
Constant Currency Calculations (in millions and includes effects of rounding) Three Months Ended March 31, 2018 (1) As Reported Calculated in Constant Currency (1) Difference Tank & Pump Tank & Pump Storage Solutions Solutions Total Storage Solutions Solutions Total Total Rental revenues $106.9 $25.
Slide 29: Reconciliation of net income to EBITDA and adjusted EBITDA by Segment
Reconciliation of net income to EBITDA and adjusted EBITDA by Segment (in millions and includes effects of rounding) Storage Solutions North America 2017 2018 LTM Q1 Q2 Q3 Q4 Q1 Net income $ 8.4 $ 6.0 $ 7.8 $ 92.3 $ 11.6 $ 117.7 Interest expense 5.6 6.0 6.4 6.5 6.7 25.5 Income tax provision (benefit
Slide 30: Reconciliation of net income to EBITDA and adjusted EBITDA by Segment
Reconciliation of net income to EBITDA and adjusted EBITDA by Segment (in millions and includes effects of rounding) Storage Solutions United Kingdom 2017 2018 LTM Q1 Q2 Q3 Q4 Q1 Net income $ 4.0 $ 4.4 $ 5.0 $ 6.1 $ 3.7 $ 19.2 Interest expense 0.1 0.1 0.1 0.1 0.2 0.6 Income tax provision (benefit) 0