Custom Truck One Source Reports Mixed Q3 Results, Decline in Profitability and Revenue for Nine Months

Custom Truck One Source, Inc. reported its financial results for the three and nine months ended September 30, 2024, revealing a mixed performance compared to the same periods in 2023. Total revenue for the third quarter increased to $447.2 million, a 3.0% rise from $434.4 million in 2023. This growth was primarily driven by a 7.9% increase in equipment sales, which reached $305.5 million, while rental revenue decreased by 8.4% to $108.3 million.

For the nine-month period, total revenue declined by 4.6% to $1.28 billion, down from $1.34 billion in 2023. The decrease was attributed to lower rental revenue and used equipment sales, impacted by customer supply chain constraints and delays in transmission job starts. Equipment sales for the nine months also fell by 2.6% to $863.7 million.

Profitability metrics showed significant declines. Gross profit for the third quarter was $91.8 million, down 14.3% from $107.2 million in 2023. Operating income also fell sharply to $23.0 million, a 39.4% decrease from $38.0 million. The company reported a net loss of $17.4 million for the third quarter, contrasting with a net income of $9.2 million in the prior year. For the nine months, the net loss totaled $56.2 million, compared to a net income of $34.6 million in 2023.

As of September 30, 2024, total assets increased to $3.58 billion from $3.37 billion at the end of 2023, with total current assets rising to $1.41 billion. However, cash and cash equivalents decreased to $8.4 million, down from $10.3 million. The company’s total liabilities also increased, with total current liabilities rising to $1.10 billion.

In terms of strategic developments, Custom Truck One Source amended its asset-based revolving credit agreement in August 2024, increasing borrowing capacity from $750 million to $950 million and extending the maturity date to August 2029. The company continues to focus on its core business of providing specialty equipment and services, primarily serving the electric utility, telecommunications, and infrastructure sectors in North America.

The company’s stock repurchase program remains active, with approximately $1.9 million available for future repurchases as of September 30, 2024. The company also reported a significant decrease in its sales order backlog, which fell by 49.2% to $395.6 million compared to the previous year.