United Rentals M&A and 4Q Results Presentation
EBITDA and Adjusted EBITDA GAAP Reconciliations
EBITDA represents the sum of net income, provision for income taxes, interest expense, net, depreciation of rental equipment, and non-rental depreciation and amortization. Adjusted EBITDA represents EBITDA plus the sum of the merger
related costs, restructuring charge, stock compensation expense, net, and the impact of the fair value mark-up of acquired fleet. These items are excluded from adjusted EBITDA internally when evaluating our operating performance and for
strategic planning and forecasting purposes, and allow investors to make a more meaningful comparison between our core business operating results over different periods of time, as well as with those of other similar companies. The net
income and adjusted EBITDA margins represent net income or adjusted EBITDA divided by total revenue. Management believes that EBITDA and adjusted EBITDA, when viewed with the Company's results under GAAP and the
accompanying reconciliation, provide useful information about operating performance and period-over-period growth, and provide additional information that is useful for evaluating the operating performance of our core business without
regard to potential distortions. Additionally, management believes that EBITDA and adjusted EBITDA help investors gain an understanding of the factors and trends affecting our ongoing cash earnings, from which capital investments are
made and debt is serviced.
The table below provides a reconciliation between net income and EBITDA and adjusted EBITDA.
$ Millions
Net income
Provision for income taxes
Interest expense, net
Depreciation of rental equipment
Non-rental depreciation and amortization
EBITDA
Merger related costs (1)
Restructuring charge (2)
Stock compensation expense, net (3)
Impact of the fair value mark-up of acquired fleet (4)
Adjusted EBITDA
Net income margin
Adjusted EBITDA margin
Three Months Ended
December 31,
Year Ended
December 31,
2020
2019
2020
2019
$
297
$
338
$
890
$ 1,174
90
95
249
340
125
170
669
648
385
420
1,601
1,631
95
96
387
407
$
992
$ 1,119
$ 3,796
$
4,200
1
6
2
17
18
24
16
70
61
15
17
49
75
$
1,037
$
1,154
$
3,932
$
4,355
13.0 %
13.8 %
10.4 %
12.6 %
45.5 %
47.0 %
46.1 %
46.6 %
Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current
restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such
restructuring program was initiated in 2008, we have completed five restructuring programs. We have cumulatively incurred total
restructuring charges of $350 million under our restructuring programs.
Represents non-cash, share-based payments associated with the granting of equity instruments.
Reflects additional costs recorded in cost of rental equipment sales associated with the fair value mark-up of rental equipment acquired
in the RSC, NES, Neff and Blue Line acquisitions and subsequently sold.
(1)
Reflects transaction costs associated with the BakerCorp and Blue Line acquisitions that were completed in 2018. We have made a number of
acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major
acquisitions that significantly impact our operations. The acquisitions that have included merger related costs are RSC, which had annual
revenues of approximately $1.5 billion prior to the acquisition, National Pump, which had annual revenues of over $200 million prior to the
acquisition, NES, which had annual revenues of approximately $369 million prior to the acquisition, Neff, which had annual revenues of
approximately $413 million prior to the acquisition, BakerCorp, which had annual revenues of approximately $295 million prior to the acquisition
and BlueLine, which had annual revenues of approximately $786 million prior to the acquisition.
United Rentals®
(2)
(3)
(4)
United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2021 United Rentals, Inc. All rights reserved.
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