Name: United Rentals Inc. (NYSE:URI) | Common-Size Income Statement
Creator: Stock Analysis on Net

Common-Size Income Statement

United Rentals Inc., common-size consolidated income statement

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Equipment rentals	86.89%	84.47%	83.70%	85.17%	86.24%
Sales of rental equipment	8.29%	9.96%	10.06%	8.89%	8.25%
Sales of new equipment	1.32%	2.09%	2.90%	2.87%	2.58%
Contractor supplies sales	1.08%	1.12%	1.15%	1.11%	1.13%
Service and other revenues	2.41%	2.36%	2.19%	1.97%	1.79%
Revenues	100.00%	100.00%	100.00%	100.00%	100.00%
Cost of equipment rentals, excluding depreciation	-34.51%	-34.26%	-33.06%	-33.43%	-32.48%
Depreciation of rental equipment	-15.92%	-16.58%	-18.77%	-17.44%	-16.94%
Cost of rental equipment sales	-3.43%	-5.53%	-6.17%	-5.54%	-4.80%
Cost of new equipment sales	-1.07%	-1.74%	-2.51%	-2.47%	-2.22%
Cost of contractor supplies sales	-0.72%	-0.80%	-0.81%	-0.78%	-0.75%
Cost of service and other revenues	-1.44%	-1.43%	-1.37%	-1.09%	-1.01%
Cost of revenues	-57.09%	-60.34%	-62.68%	-60.75%	-58.20%
Gross profit	42.91%	39.66%	37.32%	39.25%	41.80%
Selling, general and administrative expenses	-12.03%	-12.34%	-11.48%	-11.68%	-12.90%
Merger related costs	0.00%	-0.03%	0.00%	-0.01%	-0.45%
Restructuring charge	0.00%	-0.02%	-0.20%	-0.19%	-0.39%
Non-rental depreciation and amortization	-3.13%	-3.83%	-4.54%	-4.35%	-3.83%
Operating income	27.76%	23.44%	21.10%	23.01%	24.25%
Interest expense, net	-3.82%	-4.36%	-7.84%	-6.93%	-5.98%
Other income (expense), net	0.13%	-0.07%	0.09%	0.11%	0.07%
Income before provision for income taxes	24.07%	19.00%	13.35%	16.19%	18.34%
Provision for income taxes	-5.99%	-4.73%	-2.92%	-3.64%	-4.72%
Net income	18.08%	14.27%	10.43%	12.55%	13.62%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

The financial performance over the five-year period is characterized by a V-shaped recovery in profitability, with margins reaching their lowest point in 2020 before expanding to peak levels in 2022. While revenue streams remained relatively stable in composition, the efficiency of cost management and the reduction of financial expenses significantly enhanced the bottom line toward the end of the period.

Revenue Composition: Equipment rentals consistently served as the primary revenue driver, maintaining a range between 83.70% and 86.89% of total revenues. A temporary increase in the proportion of revenue from the sale of rental equipment was observed in 2020, peaking at 10.06% before returning to 8.29% by 2022. Conversely, sales of new equipment showed a steady decline from 2.58% in 2018 to 1.32% in 2022, while service and other revenues exhibited a gradual upward trend, increasing from 1.79% to 2.41% over the analyzed period.
Gross Profit and Cost Structure: The cost of revenues experienced a peak in 2020 at 62.68%, which resulted in a corresponding contraction of the gross profit margin to its lowest level of 37.32%. This trend reversed in the following two years, with the cost of revenues falling to 57.09% by 2022. Consequently, the gross profit margin expanded to 42.91% in 2022, surpassing the 2018 baseline of 41.80%.
Operating Efficiency: Operating income margins followed a similar trajectory to gross profits, declining from 24.25% in 2018 to 21.10% in 2020, before climbing to a period high of 27.76% in 2022. Selling, general, and administrative expenses remained relatively controlled, fluctuating within a tight band between 11.48% and 12.90%. Non-rental depreciation and amortization also saw a reduction, decreasing from a peak of 4.54% in 2020 to 3.13% in 2022, contributing to the overall improvement in operating leverage.
Net Profitability and Financial Costs: A significant reduction in net interest expense as a percentage of revenue is evident, dropping from a peak of 7.84% in 2020 to 3.82% in 2022. This decrease in financial burden, combined with rising operating income, led to a substantial increase in the income before provision for income taxes, which rose from 13.35% in 2020 to 24.07% in 2022. The final net income margin reflects this overall growth, expanding from 10.43% in 2020 to 18.08% by the end of 2022.

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