On August 1, 2024, WillScot Holdings Corp (WSC, Financial) released its 8-K filing for the second quarter of 2024. WillScot Holdings Corp is a business services provider specializing in flexible workspace and portable storage solutions, with the majority of its revenue generated from the United States.
Performance Overview
WillScot Holdings Corp reported revenue of $605 million for Q2 2024, a 4% increase year-over-year but below the analyst estimate of $647.07 million. The company posted a loss from continuing operations of $47 million, including a one-time non-cash impairment of $133 million associated with brand consolidation, resulting in a diluted loss per share of $0.25. Excluding these charges, adjusted income from continuing operations was $75 million, with an adjusted diluted earnings per share (EPS) of $0.39, falling short of the analyst estimate of $0.54.
Financial Achievements and Challenges
Despite the mixed results, WillScot Holdings Corp achieved several financial milestones. The company reported an adjusted EBITDA of $264 million, up 1% year-over-year, with an adjusted EBITDA margin of 44%. Net cash provided by operating activities was $176 million, and free cash flow stood at $121 million, representing a 20% free cash flow margin. The company maintained its leverage ratio at 3.3x net debt to adjusted EBITDA as of June 30, 2024.
"The operating environment was mixed during Q2 2024. We saw continued demand from larger-scale projects related to industrial, manufacturing, energy, onshoring, and infrastructure, offset by less demand from smaller, more transactional commercial construction and interest rate sensitive sectors," commented Brad Soultz, CEO of WillScot.
Income Statement Highlights
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Revenue | $605 million | $582 million |
| Adjusted EBITDA | $264 million | $261 million |
| Adjusted Diluted EPS | $0.39 | $0.44 |
| Free Cash Flow | $121 million | $160 million |
Balance Sheet and Cash Flow
WillScot Holdings Corp reported total assets of $6.05 billion as of June 30, 2024, compared to $6.14 billion at the end of 2023. The company’s total liabilities stood at $4.85 billion, with shareholders' equity at $1.20 billion. The company also completed a private offering of $500 million of senior secured notes at 6.625% due 2029, using the proceeds to repay outstanding indebtedness under the ABL Facility.
Outlook and Strategic Initiatives
WillScot Holdings Corp updated its FY 2024 adjusted EBITDA outlook range to $1,085 million to $1,125 million, representing 2% to 6% growth in continuing operations versus 2023. The company also announced a definitive agreement to acquire McGrath RentCorp, with the transaction expected to close in Q4 2024 after receiving remaining regulatory approvals.
"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," said Tim Boswell, President and CFO of WillScot.
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from WillScot Holdings Corp for further details.
