Segment Reporting

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

Segment Reporting

NOTE 16. SEGMENT REPORTING

During the quarter ended December 31, 2023, the Company determined that its Portable Storage business segment met the criteria for separate recognition as defined in the Accounting Standards Codification ("ASC") Topic 280, Segment Reporting. The guidance under this topic requires a public business entity to evaluate both quantitative and qualitative thresholds to determine the significance of a business segment and whether the separate reporting of a business segment enhances the users' understanding of the reporting entity's performance, future net cash flows and judgments. The Company evaluated the guidance within Topic 280 and made its determination to separately report the Portable Storage segment primarily due to the Company's continued growth in container fleet purchases and related increased revenues and improved profitability performance when compared to previously reported periods. In addition to this determination, the Company also divested its Adler Tanks business segment during the year ended December 31, 2023. Additional information regarding the divestiture of Adler Tanks can be found in Note 5 to the Consolidated Financial Statements.

FASB guidelines establish annual and interim reporting standards for an enterprise’s operating segments and related disclosures about its products, services, geographic areas and major customers. In accordance with these guidelines the Company’s four reportable segments are Mobile Modular, Portable Storage, TRS-RenTelco and Enviroplex. The Company's Chief Operating Decision Maker ("CODM") Joe Hanna, Chief Executive Officer, and management focus on several key measures to evaluate and assess each segment’s performance including rental, rental related services and sales revenue growth, segment profit, and income before provision for income taxes. In addition to the evaluation of the aforementioned key measures of each reportable segment, the CODM and management evaluate supplemental information by reportable segment such as rental equipment acquisitions, fleet utilization, and average utilization to further assess segment performance and the future allocation of Company resources. Excluding interest expense, allocations of revenue and expense not directly associated with one of these segments are generally allocated to Mobile Modular, Portable Storage and TRS-RenTelco, based on their pro-rata share of direct revenues. Interest expense is allocated amongst Mobile Modular, Portable Storage and TRS-RenTelco based on their pro-rata share of average rental equipment at cost, goodwill, intangible assets, accounts receivable, deferred income and customer security deposits. The Company does not report total assets by business segment.

Summarized financial information from continuing operations for the years ended December 31, 2024, 2023 and 2022, for the Company’s reportable segments is shown in the following tables:

(dollar amounts in thousands)		Mobile Modular			Portable Storage			TRS- RenTelco			Enviroplex1			Consolidated
Year Ended December 31,
2024
Revenues
Rental revenues		$	318,149		$	69,983		$	101,797		$ —			$	489,929
Rental related services revenues			127,589			17,702			3,207			—			148,498
Sales			183,234			5,695			27,531			45,830			262,290
Other			6,394			1,117			2,714			—			10,225
Total revenues			635,366			94,497			135,249			45,830			910,942
Costs of Revenues
Depreciation of rental equipment			40,399			3,982			43,886			—			88,267
Rental related services			83,547			17,267			2,605			—			103,419
Other			83,023			5,816			20,277			—			109,116
Costs of sales			124,886			3,551			12,426			33,862			174,725
Total costs of revenues			331,855			30,616			79,194			33,862			475,527
Gross profit			303,511			63,881			56,055			11,968			435,415
Significant Segment Expenses 3
Wages and benefits			57,741			13,812			10,368			4,859			86,781
Depreciation and amortization			13,712			1,432			107			383			15,634
Marketing and administrative expenses			17,276			6,102			5,342			2,323			31,043
Allocated corporate services 4			47,146			7,212			10,716			—			65,074
Other segment items 5			795			639			467			—			1,901
Total expenses			136,670			29,197			27,000			7,565			200,432
Other income, net			(6,220	)		(1,319	)		(1,742	)		—			(9,281	)
Segment profit			173,061			36,003			30,797			4,403			244,264
Interest expense (income) allocation			37,087			5,243			7,407			(2,496	)		47,241
Foreign currency exchange loss			—			—			215			—			215
Income before provision for income taxes		$	135,974		$	30,760		$	23,175		$	6,899		$	196,808
Reconciliation of Segment Profit (Loss)
Total segment gross profit														$	435,415
Segment operating expenses, net															200,432
Other income, net															(9,281	)
Interest expense allocation															47,241
Foreign currency exchange loss	`														215
Gain on merger termination from WillScot Mobile Mini (Note 1)															(180,000	)
WillScot Mobile Mini transaction costs	`														63,159
Income (loss) before provision for income taxes														$	313,649
Other Selected Information
Rental equipment acquisitions		$	154,236		$	8,106		$	17,629			—		$	179,971
Accounts receivable, net (period end)		$	174,598		$	10,455		$	21,635		$	12,654		$	219,342
Rental equipment, at cost (period end)		$	1,414,367		$	240,846		$	343,982		—			$	1,999,195
Rental equipment, net book value (period end)		$	1,060,364		$	218,493		$	108,802		—			$	1,387,659
Utilization (period end) 2			75.1	%		59.8	%		58.6	%
Average utilization 2			77.5	%		64.9	%		57.3	%

(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS- RenTelco			Enviroplex1			Consolidated
Year Ended December 31,
2023
Revenues
Rental revenues	$	285,553		$	74,536		$	114,247		$ —			$	474,336
Rental related services revenues		114,511			20,510			3,139			—			138,160
Sales		155,267			4,587			27,119			20,192			207,165
Other		6,905			1,504			3,772			—			12,181
Total revenues		562,236			101,137			148,277			20,192			831,842
Costs of Revenues
Depreciation of rental equipment		36,921			3,514			48,477			—			88,912
Rental related services		75,390			18,568			2,670			—			96,628
Other		86,983			7,317			20,642			—			114,942
Costs of sales		105,021			2,858			13,884			15,964			137,727
Total costs of revenues		304,315			32,257			85,673			15,964			438,209
Gross profit		257,921			68,880			62,604			4,228			393,633
Significant Segment Expenses 3
Wages and benefits		55,795			13,607			10,074			3,901			83,376
Depreciation and amortization		13,511			1,613			108			337			15,570
Marketing and administrative expenses		15,935			5,866			5,398			2,228			29,427
Allocated corporate services 4		44,225			9,711			14,748			—			68,684
Other segment items 5		9,109			740			634			—			10,482
Total expenses		138,574			31,537			30,962			6,466			207,539
Other income, net		(2,329	)		(457	)		(832	)		—			(3,618	)
Segment profit (loss)		121,676			37,800			32,474			(2,238	)		189,713
Interest expense (income) allocation		29,724			4,950			8,146			(2,260	)		40,560
Foreign currency exchange (gain) loss		—			—			(310	)		—			(310	)
Income before provision for income taxes	$	91,952		$	32,850		$	24,638		$	22		$	149,462
Other Selected Information
Rental equipment acquisitions	$	176,200		$	27,967		$	28,945			—		$	233,112
Accounts receivable, net (period end)	$	175,360		$	16,057		$	25,511		$	10,440		$	227,368
Rental equipment, at cost (period end)	$	1,291,093		$	236,123		$	377,587		—			$	1,904,803
Rental equipment, net book value (period end)	$	967,712		$	217,315		$	144,296		—			$	1,329,323
Utilization (period end) 2		79.4	%		71.5	%		55.9	%
Average utilization 2		79.7	%		77.3	%		58.9	%

(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS- RenTelco			Enviroplex1			Consolidated
Year Ended December 31,
2022
Revenues
Rental revenues	$	206,070		$	62,218		$	121,375		$ —			$	389,663
Rental related services revenues		74,756			17,095			3,112			—			94,963
Sales		97,046			2,933			24,571			23,170			147,720
Other		1,339			260			1,720			—			3,319
Total revenues		379,211			82,506			150,778			23,170			635,665
Costs of Revenues
Depreciation of rental equipment		28,373			2,799			49,253			—			80,425
Rental related services		49,910			16,344			2,592			—			68,846
Other		76,819			6,212			21,327			—			104,358
Costs of sales		62,224			1,849			9,707			18,048			91,828
Total costs of revenues		217,326			27,204			82,879			18,048			345,457
Gross profit		161,885			55,302			67,899			5,122			290,208
Significant Segment Expenses 3
Wages and benefits		33,465			11,598			9,690			3,144			57,897
Depreciation and amortization		8,815			1,132			113			288			10,348
Marketing and administrative expenses		10,993			4,929			5,087			2,003			23,012
Allocated corporate services 4		30,064			6,506			12,191			—			48,761
Other segment items 5		2,431			300			164			—			2,895
Total expenses		85,769			24,465			27,245			5,435			142,914
Segment profit (loss)		76,116			30,837			40,654			(313	)		147,294
Interest expense (income) allocation		8,657			1,519			3,294			(1,240	)		12,230
Foreign currency exchange loss		—			—			378			—			378
Income before provision for income taxes	$	67,459		$	29,318		$	36,982		$	926		$	134,686
Other Selected Information
Rental equipment acquisitions	$	87,535		$	34,072		$	69,928			—		$	191,535
Accounts receivable, net (period end)	$	124,184		$	14,923		$	26,442		$	4,302		$	169,851
Rental equipment, at cost (period end)	$	929,636		$	193,632		$	398,267		—			$	1,521,535
Rental equipment, net book value (period end)	$	637,151		$	178,241		$	174,924		—			$	990,316
Utilization (period end) 2		80.3	%		82.6	%		59.4	%
Average utilization 2		78.0	%		84.8	%		64.2	%

1.Gross Enviroplex sales revenues were $45,832, $22,615 and $24,164 in 2024, 2023 and 2022, respectively. There were $2, $2,423 and $992 inter-segment sales to Mobile Modular in 2024, 2023 and 2022, respectively, which have been eliminated in consolidation.

2.Utilization is calculated each month by dividing the cost of rental equipment on rent by the total cost of rental equipment excluding new equipment inventory and accessory equipment. The average utilization for the period is calculated using the average costs of rental equipment.

3.The Significant Segment Expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

4.Allocated corporate services costs are comprised of expenses incurred by the Company which are not directly incurred by each business segment as a part of their normal operations. These allocated indirect corporate costs primarily include wages and benefits, depreciation of corporate capital assets, information technology, legal, accounting and other administrative expenses.

5.Other segment items for each reportable segment is primarily comprised of business acquisition and divestiture related transaction costs and credit losses.

No single customer accounted for more than 10% of total revenues during 2024, 2023 and 2022. Revenue from foreign country customers accounted for 2%, 3% and 4% of the Company’s total revenues for years 2024, 2023, and 2022, respectively. Mobile Modular purchased 18% of its modular units from one manufacturer during 2024 and 30% in both 2023 and 2022. There were no vendor or supplier concentrations for Portable Storage, TRS-RenTelco and Enviroplex during years 2024, 2023 and 2022.