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Sunbelt reports 24 percent growth in rental revenue, continues expansion

By Stephen Elliott

June 18, 2023

Sunbelt RentalsSunbelt Rentals, Fort Mill, S.C., reported rental revenue of $7.5 billion for the fiscal year ending April 30, 2023, a 24 percent increase over last year. In its fiscal fourth quarter, the company’s rental revenue was $1.44 billion, up 17 percent. Sunbelt’s guidance for 2024 calls for another 13 to 16 percent growth in rental revenue in the U.S.  

Overall, Ashtead Group, the parent company of Sunbelt, reported total revenue of $9.67 billion in fiscal 2023, up 24 percent over last year, and rental revenue of $8.7 billion, up 22 percent, which includes results for Sunbelt in the U.S., Canada and the U.K. In its fiscal fourth quarter, Ashtead reported total revenue of $2.44 billion, up 19 percent, and rental revenue of $2.13 billion, up 15 percent.  

“I am delighted to report another year of strong performance across all geographies, with rental revenue growth of 22 percent for the year at constant currency, delivering record revenue and profitability for the Group. This market outperformance is only possible through the dedication of our team members who deliver for all our stakeholders every day, while ensuring our leading value of safety remains at the forefront of all we do,” said Brendan Horgan, Ashtead CEO. 

Of particular note, Sunbelt Rentals invested $3.8 billion in capital across existing locations and greenfields. Horgan said this capital investment was funded from operating cash flow highlighting the cash generative nature, “of our business across the cycle.” 

In addition, the company spent $1.1 billion on 50 bolt-on acquisitions, which, when combined with greenfield openings, added 165 locations in North America.  

“This significant investment is enabling us to take advantage of the substantial structural growth opportunities that we see for the business as we deliver our strategic priorities to grow our general tool and specialty businesses and advance our clusters,” Horgan said. “We are achieving this while maintaining a strong and flexible balance sheet with leverage towards the lower end of our target range.” 

In 2023, Sunbelt estimates that United Rentals, Stamford, Conn., now has a 17 percent market share compared to their 13 percent share, and predicts that in the future, two or three companies will have a combined market share of 50 percent.  

In 2010, the company had a 4 percent market share, second behind United Rentals, which had a 5 percent market share. 

The company said it also is entering the final year of Sunbelt 3.0, the strategic growth plan to reach 1,234 locations by April 2024. 

“We enter the final year of Sunbelt 3.0 with clear momentum in strong end markets, which are enhanced by the increasing number of mega projects and recent U.S. legislative acts,” Horgan said. “We are in a position of strength, with the operational flexibility and financial capacity to capitalize on the opportunities arising from these strong markets and ongoing structural change. The board looks to the future with confidence.”