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McGrath RentCorp (MGRC) is a diversified business-to-business rental company that primarily focuses on equipment rentals. Incorporated in 1979 and headquartered in Livermore, California, MGRC operates through several business segments, offering a range of products including relocatable modular buildings, portable storage containers, and electronic test equipment. The company's operations emphasize rental services, sales of equipment, and value-added services for customers.
- Mobile Modular - Provides rental and sale of relocatable modular buildings used for classroom and office space, contributing significantly to the company's operations.
- Portable Storage - Offers portable storage containers for various storage needs, playing a key role in the company's rental services.
- TRS-RenTelco - Specializes in the rental of electronic test equipment for general purpose and communications needs, supporting diverse industries.
- Enviroplex - Manufactures and sells modular buildings primarily used as classrooms in California, enhancing the company's product offerings.
| Name | Position | External Roles | Short Bio | |
|---|---|---|---|---|
Joseph F. Hanna ExecutiveBoard | President, Chief Executive Officer, and a Director | Member of the Board of Directors of Janus International Group (since January 2024) | Joseph F. Hanna became the CEO of MGRC in February 2017 after over a decade in key operational roles, including serving as COO from 2007 to 2017 and joining the company in 2003 as Vice President of Operations. His extensive experience has driven strategic growth at MGRC while also enhancing his leadership capabilities. | View Report → |
David M. Whitney Executive | Senior Vice President, Chief Accounting Officer | David M. Whitney has been with MGRC since 2000, initially as Corporate Controller and later as Vice President and Principal Accounting Officer in March 2006, before being promoted to his current role as Senior Vice President, Chief Accounting Officer effective January 13, 2025. He has been instrumental in overseeing the company's accounting operations, ensuring strong financial governance. | ||
Gilda Malek Executive | Senior Vice President, Chief Legal Officer | Gilda Malek serves as Senior Vice President, Chief Legal Officer at MGRC since January 16, 2025, having previously served as Vice President, General Counsel, and Corporate Secretary from 2023. She also brings extensive legal experience from her tenures at Confluent and AECOM. | ||
Keith E. Pratt Executive | Executive Vice President, Chief Financial Officer, and Assistant Corporate Secretary | Keith E. Pratt serves as the Executive Vice President, Chief Financial Officer, and Assistant Corporate Secretary at MGRC since February 2017. He began his MGRC career as Vice President in January 2006 and was later promoted to Senior Vice President in June 2007, underscoring his extensive expertise in financial leadership. | ||
Kristina Van Trease Executive | Senior Vice President, Chief Strategy Officer | Kristina Van Trease has been the Senior Vice President, Chief Strategy Officer at MGRC since December 2023. She has a long history at MGRC, previously serving as Senior Vice President, Strategy and Business Development from February 2022 and holding various leadership roles since joining the company in 1992. | ||
Philip B. Hawkins Executive | Chief Operating Officer (COO) | Philip B. Hawkins is the Chief Operating Officer (COO) of MGRC since January 13, 2025. He previously held roles as Senior Vice President and Division Manager, Mobile Modular starting in January 2022, and served in various leadership positions at MGRC. | ||
Bradley M. Shuster Board | Chairman of the Board | Executive Chairman and Chairman of the Board at NMI Holdings, Inc.; Independent Director at WaFd, Inc.; Independent Director at Luther Burbank Corporation | Bradley M. Shuster has been serving as the Chairman of the Board at McGrath RentCorp since 2021 after being elected as a director in 2017 and previously serving as Vice-Chairman from 2020 to 2021. He brings extensive financial and strategic leadership experience from his active roles at NMI Holdings, Inc. as Executive Chairman and from his independent director positions at WaFd, Inc. and Luther Burbank Corporation. | |
Kimberly A. Box Board | Director & Chair of the Compensation Committee | Board Director of Applied Science, Inc.; Board Member, NACD Northern California Chapter | Kimberly A. Box has served as a Director of MGRC since 2018, currently acting as the Chair of the Compensation Committee at the company. She brings extensive leadership experience from her previous role as President and CEO of Gatekeeper Innovation, Inc. and a 29‐year career at Hewlett Packard. | |
Nicolas C. Anderson Board | Member of the Board of Directors | Managing Partner of Elm Grove Partners; CEO of ArcherHall; Board Member of Bank of Marin; Board Member of YMCA of Superior California | Nicolas C. Anderson has built a diverse career in finance, private equity, and entrepreneurship, and has served on the MGRC Board since December 1, 2022. He is also the Managing Partner of Elm Grove Partners and the CEO of ArcherHall, showcasing his leadership across multiple organizations. | |
Smita Conjeevaram Board | Director and Chair of the Corporate Governance and Nominating Committee | Board Director of SS&C Technologies Holdings, Inc.; Board Director of SkyWest, Inc.; Board Director of WisdomTree Investments, Inc. | Smita Conjeevaram has been serving as a Director at MGRC since January 2021, where she also chairs the Corporate Governance and Nominating Committee. She brings extensive experience from her previous CFO roles at Fortress Investment Group LLC and other financial institutions. | |
William J. Dawson Board | Director and Chair of the Audit Committee | Board Member of Wellington Trust Company; Board Member of Nalu Medical, Inc. | William J. Dawson has been a director at MGRC since 1998 and currently serves as the Chair of the Audit Committee. He has an extensive background in finance, having held CFO roles at Adamas Pharmaceuticals, Catalyst Biosciences, and Cerus Corporation, and has significant investment banking experience. |
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Portable Storage rental revenues declined by 15% in Q4 2024, with utilization falling from 74.8% to 61.2% year-over-year ; what specific actions are you taking to reverse this trend, and when do you expect to see tangible improvements in this segment?
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Despite a 10% increase in total company revenues in Q4 2024, adjusted EBITDA only grew by 5% ; can you explain the factors contributing to this margin compression and how you plan to address them in 2025?
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With capital expenditures significantly reduced for 2025 and a strong balance sheet, including leverage at 1.68x , how do you plan to allocate excess capital to drive shareholder value in the absence of substantial CapEx investments?
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Given the dip in Mobile Modular's fleet utilization from 79.7% to 76% in Q4 2024 , and expectations for utilization to potentially decline further before improving , what strategies are in place to enhance utilization rates and sustain growth in this core segment?
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TRS-RenTelco faced a 9% decline in rental revenues in Q4 2024 ; while you mention signs of bottoming out , what concrete indicators support a sustained recovery, and how are you positioning the business to capitalize on potential market improvements?
Notable M&A activity and strategic investments in the past 3 years.
| Company | Year | Details |
|---|---|---|
Inland Leasing and Storage | 2023 | Completed on July 1, 2023, the acquisition was executed for $3.8 million via an asset purchase, expanding the Colorado-based portable storage fleet by approximately 600 units with asset allocations of ~$3.0 million in rental equipment and ~$0.7 million in intangible assets. |
Dixie Temporary Storage, LLC (Dixie Storage) | 2023 | Completed on April 1, 2023 for $4.9 million, this business acquisition expanded the South Carolina portable storage fleet by 800 units and was accounted for under ASC 805 with $0.1 million in transaction costs. |
Jerald R. Brekke, Inc. (Brekke Storage) | 2023 | Completed on March 1, 2023 with a purchase price of $16.4 million plus $0.2 million in transaction costs, this acquisition increased the Colorado fleet by about 2,700 units and was accounted for as a business purchase under ASC 805. |
Vesta Housing Solutions Holdings, Inc. (Vesta Modular) | 2023 | Acquired on February 1, 2023 for $437.2 million in cash (adjusted for net working capital and capital expenditures), this strategic move expanded McGrath RentCorp’s modular solutions portfolio, delivering projected synergies of $8 million in annual run-rate benefits and $30 million from net operating losses, along with recording $213.313 million in goodwill and $26 million in customer relationships, plus $9.5 million in transaction costs. |
Design Space Modular Buildings | 2021 | Completed on May 17, 2021 for a cash price of $260 million, this acquisition broadened the geographic footprint across the Western U.S. with 15 branches and a rental fleet of 6,400 units, including $101.874 million in goodwill and $37.9 million in customer relationships, financed via McGrath RentCorp’s revolving credit facility. |
Kitchens To Go | 2021 | Completed on April 1, 2021 for $18.3 million in cash, the acquisition of Kitchens To Go (assets of GRS Holding LLC) enhanced the Mobile Modular division with modular kitchen solutions for foodservice providers, expected to be modestly accretive to EPS in 2021. |
Recent press releases and 8-K filings for MGRC.
- Earnings Summary: McGrath RentCorp reported total revenues of $195.4M (+4%), adjusted EBITDA of $74.5M (+3%), and net income of $28.2M
- Mobile Modular Performance: The segment posted revenues of $131.9M (+3%) and adjusted EBITDA of $47.6M (+10%), with rental margins improving from 57% to 60%
- Rental Operations: Generated revenues of $154.0M and paid a dividend of $0.485 per share (1.9% yield)
- Management Outlook: Ongoing modular sales initiatives were highlighted amid a cautious outlook due to economic uncertainty, potential project delays, and tariff headwinds
- Full-Year Guidance Update: The revised outlook projects total revenues between $920M–$960M and adjusted EBITDA between $343M–$355M, reflecting strategic investments and cost management
- Additional Details: For further inquiries, contact Keith E. Pratt, EVP & CFO