United Rentals, Inc.

Good morning and welcome to the United Rentals Investor Conference call. Please be advised that this call is being recorded. Before we begin, please note that the company's press release, comments made on today's call, and responses to your questions contain forward-looking statements. The company's business and operations are subject to a variety of risks and uncertainties, many of which are beyond its control and consequently Actual results may differ materially from those projected. A summary of these uncertainties is included in the Safe Harbor Statement contained in the company's press release. For a more complete description of these and other possible risks, please refer to the company's annual report on Form 10-K for the year ended December 31, 2023, as well as to subsequent filings with the SEC. You can access these filings on the company's website at www.unitedrentals.com. Please note that United Rentals has no obligation and makes no commitment to update or publicly release any revisions to forward-looking statements in order to reflect new information or subsequent events, circumstances, or changes in expectations. You should also note that the company's press release and today's call include references to non-GAAP terms such as free cash flow, adjusted EPS, EBITDA, and adjusted EBITDA. Please refer to the back of the company's recent investor presentations to see the reconciliation from each non-GAAP financial measure to the most comparable GAAP financial measure. Speaking today for United Rentals is Matt Flannery, President and Chief Executive Officer and Ted Grace, Chief Financial Officer. I will now turn the call over to Mr. Flannery. Mr. Flannery, you may begin.

Thank you, Operator, and good morning, everyone. Thanks for joining our call. As you saw yesterday afternoon, 2024 continues to play out as we expected. We were pleased with our third quarter results, which continue to reflect growth across both our construction and industrial end markets. Our updated guidance reaffirms our expectations for another year of profitable growth, which we were able to deliver thanks to our more than 27,000 team members. Their hard work enables us to support our customers with world-class service and innovative solutions, all while keeping safety as priority number one. As you've heard me talk about before, we continue to double down on being the partner of choice for our customers. We're helping them solve for their goals across safety, productivity, and sustainability through our compelling value proposition. Importantly, not only does our business model enable us to best serve our customers, but it also generates strong shareholder value. Today, I'll discuss our third quarter results, our expectations for the rest of this year, and share some examples of how we continue to innovate and rapidly respond to customer needs. And then Ted will discuss the financial details before we open up the call for Q&A. So let's start with the third quarter results. Our total revenue grew by 6% year over year to almost $4 billion. And within this, rental revenue grew by over 7% to $3.5 billion, both third quarter records. Late productivity increased by 3.5%, supported by our focus on capital efficiency and continued industry discipline. Adjusted EBITDA increased to a third quarter record of $1.9 billion, translating to a margin of almost 48%. And adjusted EPS grew year over year to $11.80, another third quarter record. Now, let's turn to customer activity. We saw growth in both our gen rent and specialty businesses. Specialty rental revenue grew an impressive 24% year over year and a strong 15%, even if you exclude the benefits of the acquisition. Our cross-selling efforts helped fuel growth across all of our product offerings. And furthermore, we added 15 cold starts in the quarter, putting us at 57 year to date. By vertical, third quarter trends were similar to the second quarter. We saw growth in both construction led by non-res and our industrial end markets with particular strength in manufacturing. It'll come as no surprise that we again had multiple new projects in the quarter across data centers, airports, healthcare, and battery manufacturing to name a few. Now turning to the used market, which remains healthy. As Ted will elaborate on, we sold a third quarter record amount of OEC. which speaks to the strength of demand, while our margins primarily reflected the ongoing normalization of the market. And as we replace this equipment and buy additional fleet to meet our customer needs, we spent almost $1.3 billion on CapEx in the third quarter. We continue to see opportunity to put fleet on rent, and our full-year guidance reflects a tightened CapEx range with the midpoint unchanged. Year-to-date free cash flow is over $1.2 billion. We're on track to hit our full-year goal, which translates to a free cash flow margin in the mid-teens. For industry-leading profit margins, focus on capital efficiency and flexible business model translate to strong free cash generation and ultimately provide us the ability to create long-term value for our shareholders. And finally, capital allocations. We returned nearly $500 million to shareholders in the quarter via share buybacks and our dividend. Our balance sheet is in excellent shape, and we're on track to return nearly $2 billion this year. As we wrap up 2024, we're focused on continued execution and delivering another year of records across revenue, adjusted EBITDA, and earnings. Our updated guidance, which maintains the midpoint for revenue, EBITDA, and rental CapEx reflects just that. We have good momentum heading into 2025, which is setting up to be another year of growth based on what we see and sense today. The tailwinds for a multitude of large, complex projects are still in the early innings, and we believe we're uniquely positioned as the partner of choice with our customers. And to support these initiatives, we continue to make investments in optimizing operations for both ourselves and our customers. For example, we're investing in our next generation telematics products, which help customers gain new insights into their own operations and allows our technicians to prioritize their workflow and best manage our fleet. Elsewhere on the innovation front, we recently announced a great example of a customer supporting technology. Our pro box on demand is a Bluetooth enabled automated tool tracking system, which ensures workers have the right tools where and when they need them and tracks tools in real time to significantly reduce worksite loss. Both of these examples demonstrate our culture of innovation and continuous improvement. But taking care of our people and helping our communities are also key elements of our culture. And I was very pleased with how quickly our team reacted in the aftermath of the devastating damage caused by both hurricanes Helene and Milton. In both instances, we were immediate to respond, putting our proven United Runnels playbook to work and providing our customers with the support needed to start the cleanup and rebuild process. So to wrap things up, 2024 remains on track, with 2025 setting up to be another year of growth. which we'll discuss in greater detail in January. We continue to deepen our relationships as we partner with our customers, not only providing them the equipment they require, but also helping them solve their other challenges. The combination of our competitive advantages and flexible business model, coupled with our focus on profitable growth, strong free cash flow, and smart capital allocation, positions us to drive long-term, and sustainable shareholder value. And with that, I'll hand the call over to Ted before we take your questions.

Ted, over to you.