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Cover and table of contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2018
Commission File Number 1-14387
United Rentals, Inc.
Commission File Number 1-13663
United Rentals (North America), Inc.
(Exact Names of Registrants as Specified in Their Charters)
| Delaware Delaware | 06-1522496 86-0933835 |
| (States of Incorporation) | (I.R.S. Employer Identification Nos.) |
| 100 First Stamford Place, Suite 700, Stamford, Connecticut | 06902 |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrants’ Telephone Number, Including Area Code: (203) 622-3131
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Name of Each Exchange on Which Registered |
| Common Stock, $.01 par value, of United Rentals, Inc. | New York Stock Exchange |
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No þ
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large Accelerated Filer | þ | Accelerated Filer | o | ||
| Non-Accelerated Filer | o | Smaller Reporting Company | o | ||
| Emerging Growth Company | o |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ
As of June 30, 2018 there were 82,895,244 shares of United Rentals, Inc. common stock outstanding. The aggregate market value of common stock held by non-affiliates (defined as other than directors, executive officers and 10 percent beneficial owners) at June 30, 2018 was approximately $10.80 billion, calculated by using the closing price of the common stock on such date on the New York Stock Exchange of $147.62.
As of January 21, 2019, there were 79,591,082 shares of United Rentals, Inc. common stock outstanding. There is no market for the common stock of United Rentals (North America), Inc., all outstanding shares of which are owned by United Rentals, Inc.
This Form 10-K is separately filed by (i) United Rentals, Inc. and (ii) United Rentals (North America), Inc. (which is a wholly owned subsidiary of United Rentals, Inc.). United Rentals (North America), Inc. meets the conditions set forth in General Instruction (I)(1)(a) and (b) of Form 10-K and is therefore filing this form with the reduced disclosure format permitted by such instruction.
Documents incorporated by reference: Portions of United Rentals, Inc.’s Proxy Statement related to the 2019 Annual Meeting of Stockholders, which is expected to be filed with the Securities and Exchange Commission on or before March 26, 2019, are incorporated by reference into Part III of this annual report.
FORM 10-K REPORT INDEX
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This annual report on Form 10-K contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “should,” “seek,” “on-track,” “plan,” “project,” “forecast,” “intend” or “anticipate,” or the negative thereof or comparable terminology, or by discussions of strategy or outlook. You are cautioned that our business and operations are subject to a variety of risks and uncertainties, many of which are beyond our control, and, consequently, our actual results may differ materially from those projected.
Factors that could cause actual results to differ materially from those projected include, but are not limited to, the following:
| • | the possibility that companies that we have acquired or may acquire, including NES Rentals Holdings II, Inc. (“NES”), Neff Corporation ("Neff"), BakerCorp International Holdings, Inc. (“BakerCorp”) and Vander Holding Corporation and its subsidiaries ("BlueLine"), could have undiscovered liabilities or involve other unexpected costs, may strain our management capabilities or may be difficult to integrate; |
| • | the cyclical nature of our business, which is highly sensitive to North American construction and industrial activities; if construction or industrial activity decline, our revenues and, because many of our costs are fixed, our profitability may be adversely affected; |
| • | our significant indebtedness (which totaled $11.7 billion at December 31, 2018) requires us to use a substantial portion of our cash flow for debt service and can constrain our flexibility in responding to unanticipated or adverse business conditions; |
| • | inability to refinance our indebtedness on terms that are favorable to us, or at all; |
| • | incurrence of additional debt, which could exacerbate the risks associated with our current level of indebtedness; |
| • | noncompliance with financial or other covenants in our debt agreements, which could result in our lenders terminating the agreements and requiring us to repay outstanding borrowings; |
| • | restrictive covenants and amount of borrowings permitted in our debt instruments, which can limit our financial and operational flexibility; |
| • | overcapacity of fleet in the equipment rental industry; |
| • | inability to benefit from government spending, including spending associated with infrastructure projects; |
| • | fluctuations in the price of our common stock and inability to complete stock repurchases in the time frame and/or on the terms anticipated; |
| • | rates we charge and time utilization we achieve being less than anticipated; |
| • | inability to manage credit risk adequately or to collect on contracts with a large number of customers; |
| • | inability to access the capital that our businesses or growth plans may require; |
| • | incurrence of impairment charges; |
| • | trends in oil and natural gas could adversely affect the demand for our services and products; |
| • | the fact that our holding company structure requires us to depend in part on distributions from subsidiaries and such distributions could be limited by contractual or legal restrictions; |
| • | increases in our loss reserves to address business operations or other claims and any claims that exceed our established levels of reserves; |
| • | incurrence of additional expenses (including indemnification obligations) and other costs in connection with litigation, regulatory and investigatory matters; |
| • | the outcome or other potential consequences of regulatory matters and commercial litigation; |
| • | shortfalls in our insurance coverage; |
| • | our charter provisions as well as provisions of certain debt agreements and our significant indebtedness may have the effect of making more difficult or otherwise discouraging, delaying or deterring a takeover or other change of control of us; |
| • | turnover in our management team and inability to attract and retain key personnel; |
| • | costs we incur being more than anticipated, and the inability to realize expected savings in the amounts or time frames planned; |
| • | dependence on key suppliers to obtain equipment and other supplies for our business on acceptable terms; |
| • | inability to sell our new or used fleet in the amounts, or at the prices, we expect; |
| • | competition from existing and new competitors; |
| • | risks related to security breaches, cybersecurity attacks, failure to protect personal information, compliance with data protection laws and other significant disruptions in our information technology systems; |
| • | the costs of complying with environmental, safety and foreign law and regulations, as well as other risks associated with non-U.S. operations, including currency exchange risk (including as a result of Brexit), and tariffs; |
| • | labor disputes, work stoppages or other labor difficulties, which may impact our productivity, and potential enactment of new legislation or other changes in law affecting our labor relations or operations generally; |
| • | increases in our maintenance and replacement costs and/or decreases in the residual value of our equipment; |
| • | the effect of changes in tax law; and |
| • | other factors discussed under Item 1A-Risk Factors, and elsewhere in this annual report. |
We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances after the date any such statement is made.
PART I
United Rentals, Inc., incorporated in Delaware in 1997, is principally a holding company. We primarily conduct our operations through our wholly owned subsidiary, United Rentals (North America), Inc., and its subsidiaries. As used in this report, the term “Holdings” refers to United Rentals, Inc., the term “URNA” refers to United Rentals (North America), Inc., and the terms the “Company,” “United Rentals,” “we,” “us,” and “our” refer to United Rentals, Inc. and its subsidiaries, in each case unless otherwise indicated.
Unless otherwise indicated, the information under Items 1, 1A and 2 is as of January 1, 2019.