WillScot reports mixed environment

Photo: WillScot

WillScot Holdings Corporation has reported a moderate increase in revenues for the second quarter of 2024.

Revenues for the portable accommodation and storage specialist increased by 4% to $604 million on the same period in 2023, while adjusted EBITDA was $264 million, up 1%.

The company said it had seen a mixed environment in the quarter, with a drop in demand from smaller, more transactional commercial construction and interest rate sensitive sectors.

However, it added that this was offset by continued demand from larger-scale projects related to industrial, manufacturing, energy, onshoring and infrastructure.

Looking ahead, it has narrowed its guidance for revenues for the full year, with it now expecting revenues to be between $2.4 and $2.5 billion, although this excludes any sales generated from its purchase of McGrath.

It said it expects that deal to close at some point in the fourth quarter of 2024. Meanwhile, it invested $55 million in Capex in the quarter and expects that figure to reach between $260 and $290 million by the year end. 

That would represent an increase of between 40% at the lower end and 57% at the higher end of the guidance.

Brad Soultz, chief executive officer, WillScot, said, “Despite this backdrop, modular activations were up year-over-year, so we continue to be pleased with the resilience of our modular portfolio and our differentiated value proposition.

“Storage orders and activations also improved throughout the second quarter, with units on rent stabilising sequentially heading into July. While we continued to see strong momentum across our pricing and Value-Added Products KPIs, sequential unit on rent growth was slower than we expected.” 

Tim Boswell, president and chief financial officer, added, “Overall, our financial results in the second quarter were in line with our expectations, with stronger margins offsetting slower sequential revenue growth. 

“Free Cash Flow remained robust despite transaction costs, and we have significant balance sheet and capital allocation flexibility. At the midpoints of our revised guidance, we expect revenue of $2.45 billion and Adjusted EBITDA of $1.11 billion, which will each be up approximately 4% versus full year 2023, with approximately 20 basis points of margin expansion for the year.

“The combination of continued top-line growth, coupled with structural improvements to profitability, demonstrates our model’s resilience in a challenging demand environment. And WillScot continues to be on track to achieve its best financial performance in company history in 2024, with a strong trajectory heading into 2025.”

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