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Sep 30, 2024
Custom Truck Q3 2024 Earnings Report
Custom Truck's financial performance saw sequential improvement in net income and a slight increase in Adjusted EBITDA.
Key Takeaways
Custom Truck One Source reported a 3.0% increase in total revenue compared to Q3 2023, driven by higher new truck sales and equipment rentals. The company is optimistic about fiscal 2025, anticipating benefits from secular tailwinds like AI, data center investments, electrification, and utility grid upgrades.
Total revenue reached $447.2 million, a 5.7% increase compared to the second quarter of 2024.
Net loss decreased to $17.4 million, a 28.9% improvement compared to the second quarter of 2024.
Adjusted EBITDA increased slightly by 0.2% compared to the second quarter of 2024, reaching $80.2 million.
Average OEC on rent increased by $38.0 million, or 3.6%, compared to the second quarter of 2024.
Custom Truck
Custom Truck
Custom Truck Revenue by Segment
Revenue by Segment
Equipment Rental Solutions Revenue
CapyFin.comTruck and Equipment Sales Revenue
CapyFin.comAftermarket Parts and Services Revenue
CapyFin.com Forward Guidance
The company is updating its full-year revenue and Adjusted EBITDA guidance for 2024, expecting continued strength in rental, used and new equipment sales demand across all end markets with a goal to achieve a net leverage ratio below 3.0x in fiscal 2025.
Positive Outlook
- Increase in OEC on rent of over $200 million, or 20%, as of late October.
- Improvement includes an estimated $40 million to $60 million of OEC on rent resulting from customers’ storm-related work.
- Supply chain improvements, healthy inventory levels, and more normalized backlog levels continue to improve ability to produce and deliver more units in 2024.
- Anticipate a return to double-digit Adjusted EBITDA growth in 2025.
- Expect to generate meaningful positive levered free cash flow and deliver improved leverage.
Challenges Ahead
- Experiencing some softness in the sale of used equipment expected to continue through the balance of the fiscal year.
- Reducing the top end of ERS revenue outlook by $15 million.
- Customers are choosing to delay certain purchase decisions influenced by both their expectation of lower interest rates to come and the uncertainty surrounding the upcoming election.
- Lowering the top end of the revenue outlook by $75 million, resulting in an estimated TES revenue growth for the year of 6.0% to 12.6%.
- Lowering the top end of consolidated revenue and Adjusted EBITDA guidance ranges for this year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income