Our strategic priorities

We will always be a cyclical business but increasingly the level of structural change in our markets, particularly in the US and now also in Canada, combined with our proven strategy, makes us better able to capitalise on a good economic environment and be more resilient to economic downturn.  Our strategy to optimise the opportunities presented by structural change is growth through same-store investment, greenfields and bolt-ons.  From 2011 to 2018, we achieved 20% compound annual growth in the US, of which two-thirds was from structural change.  Our markets remain full of potential and we do not see that changing in the short term.  If the situation does change we will be well prepared.  We are always conservative in our approach to maintaining a stable and secure balance sheet throughout the cycle and this enables us to maintain the flexibility we require to manage changes to the business and its environment as and when they occur.  Our focus remains on responsible, sustainable growth.

Our goal in the medium to long term is to achieve 15% market share in the US, take a 5% share in Canada and grow it by 50% in the UK.  We continue to believe these are realistic goals given the way the rental market is evolving and the way we do business.  Consistent implementation of our strategy across the economic cycle will ensure we are in a strong position at all times to take advantage of the opportunities presented.  In the near term, our Project 2021 plan is to grow to 900 locations in North America and be a $5bn+ revenue business by 2021 and we are on track to deliver that ahead of schedule.  

Build a broad platform for growth

    • Build a broad platform for growth:
      • target 15% US market share
      • take 5% Canadian market share
      • increase UK market share by 50%
    • Same-store fleet growth
    • Greenfield expansion
    • Bolt-on M&A
    • Develop specialty products
    • Develop diversified clusters in key areas
    • Increased focus on renting out non-traditional rental equipment
    • 8% US market share
    • 2% Canadian market share
    • 8% UK market share
    • 17% increase in US rental fleet at cost
    • 19% increase in US fleet on rent
    • 42 greenfield openings in US
    • $259m spent on US acquisitions
    • C$220m spent on Canadian CRS acquisitions
    • £25m spent on UK acquisitions
    • Fleet on rent
    • Competition
    • People

Operational excellence

    • Operational excellence:
      • improve operational capability and
      • continued focus on
    • Operational improvement:
      • delivery cost recovery
      • fleet efficiency
    • Increased use of technology to drive optimal service and revenue growth
    • ARE initiative: Availability, Reliability, Ease
    • Focus on culture
    • Continued focus on improvement programmes designed to deliver improved dollar utilisation and EBITDA margins

    • Dollar utilisation
    • Underlying EBITDA margins
    • RoI
    • Fleet on rent
    • Staff turnover
    • Safety
    • Business continuity
    • People
    • Health and safety
    • Environmental
    • Laws and regulations

Maintain financial and operational flexibility

    • Maintain financial and operational flexibility:
      • RoI above 15% for the Group
      • maintain leverage in the range 1.5 to 2 times net debt to EBITDA
      • ensure financial firepower at bottom of cycle for next 'step-change'
    • Driving improved dollar utilisation
    • Maintain drop through rates
    • Increasing US store maturity
    • Maintaining financial discipline
    • Optimise fleet profile and age during the cyclical upturn
    • Strong RoI at 18% (2017: 17%)
    • Sunbelt US dollar utilisation of 55% (2017: 53%)
    • Sunbelt Canada dollar utilisation of 60% (2017: 40%)
    • A-Plant dollar utilisation of 48% (2017: 51%)
    • Fall through of 50% and 36% in Sunbelt US and A-Plant
    • Sunbelt US EBITDA margin of 50% (2017: 50%), Sunbelt Canada EBITDA margin of 30% (2017: 40%)
    • A-Plant EBITDA margin of 35% (2017: 37%)
    • Leverage of 1.6x EBITDA
    • Fleet age remains appropriate at this stage of the cycle:
      • Sunbelt US 32 months (2017: 29 months)
      • Sunbelt Canada 28 months (2017: 20 months)
      • A-Plant 32 months (2017: 29 months)
    • RoI
    • Dollar utilisation
    • Underlying EBITDA margins
    • Leverage
    • Net debt
    • Economic conditions
    • Competition
    • Financing

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