What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-01-29 compared with 2024-01-24 · 197 added, 199 removed, 1186 unchanged (25% of the section changed)

27 unchanged sentences

As discussed in Note 2 to the consolidated financial statements, goodwill is tested for impairment at least annually at the reporting unit level.

Also as described in Note 2, the Company determined that the fair value of its Mobile Storage reporting unit exceeded its carrying value by eight percent.

Auditing management’s annual goodwill impairment test for the Mobile Storage reporting unit was complex and judgmental due to the significant estimations required to determine the fair value of the reporting unit.

In particular, the fair value estimates were sensitive to significant assumptions, including the discount rate and revenue growth rates, which are affected by expectations about future operational, rental industry market or economic conditions.

In particular, the determination of the fair value of the Mobile Storage reporting unit required management to make significant assumptions, including the discount rate and revenue growth rates, which are affected by expectations about future operational, rental industry market or economic conditions.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s goodwill impairment review process for the Mobile Storage reporting unit, including controls over management’s development and review of the significant assumptions described above and review of the reasonableness of the data utilized in the Company’s valuation analysis.

63 unchanged sentences

Selling, general and administrative expenses 1,645 1,527 1,400

Merger related costs — — 3

Restructuring charge 3 28 —

2 unchanged sentences

Interest expense, net 691 635 445

Other (income) expense, net ( 19 ) ( 15 ) 7

Other income, net ( 14 ) ( 19 ) ( 15 )

Income before provision for income taxes 3,388 3,211 2,802

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Foreign currency translation adjustments ( 93 )

Fixed price diesel swaps 1

Stock compensation expense, net — 127

Tax withholding for share based compensation ( 68 )

Repurchase of common stock ( 3 ) 3 ( 1,000 )

Balance at December 31, 2022 69 $ 1 $ 2,626 $ 9,656 45 $ ( 4,957 ) $ ( 264 )

Net income 2,424

Dividends declared (3) ( 408 )

Foreign currency translation adjustments 37

Fixed price diesel swaps ( 1 )

Stock compensation expense, net — 94

5 unchanged sentences

Foreign currency translation adjustments ( 177 )

Fixed price diesel swaps ( 1 )

Stock compensation expense, net — 112

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(2) As of December 31, 2024, 2023 and 2022, the Accumulated Other Comprehensive Loss balance primarily reflects foreign currency translation adjustments.

(3) I n January 2023, our Board of Directors approved our first-ever quarterly dividend program (accordingly, there were no dividends declared during 2022 or 2021).

We declared dividends of $ 5.92 per share during the year ended December 31, 2023.

(3) I n January 2023, our Board of Directors approved our first-ever quarterly dividend program (accordingly, there were no dividends declared during 2022).

We declared dividends of $ 6.52 and $ 5.92 per share during the years ended December 31, 2024 and December 31, 2023, respectively.

See accompanying notes.

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Stock compensation expense, net

Merger related costs

Restructuring charge

Loss on repurchase/redemption of debt securities — 17 30

Increase in deferred taxes 35 537 268

Loss on repurchase/redemption/amendment of debt 1 — 17

(Decrease) increase in deferred taxes ( 19 ) 35 537

Changes in operating assets and liabilities, net of amounts acquired:

1 unchanged sentence

Decrease (increase) in inventory 15 19 ( 25 )

Decrease (increase) in prepaid expenses and other assets 281 ( 164 ) 248

(Increase) decrease in prepaid expenses and other assets ( 27 ) 281 ( 164 )

(Decrease) increase in accounts payable ( 203 ) ( 45 ) 304

Increase in accrued expenses and other liabilities 85 238 87

(Decrease) increase in accrued expenses and other liabilities ( 31 ) 85 238

Net cash provided by operating activities

24 unchanged sentences

Effect of foreign exchange rates

( 30 ) 3 ( 7 )

Net increase (decrease) in cash and cash equivalents 94 257 ( 38 )

19 unchanged sentences

We rent equipment to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities.

We primarily operate in the United States and Canada, and have a limited presence in Europe, Australia and New Zealand.

We primarily operate in the United States and Canada, and have a smaller presence in Europe, Australia and New Zealand.

In addition to renting equipment, we sell new and used rental equipment, as well as related contractor supplies, parts and service.

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Rental equipment is depreciated whether or not it is out on rent.

Accounts payable as of December 31, 2023 includes $ 74 of amounts due but unpaid for purchases of rental equipment.

The net impact of accrued purchases of rental equipment was no t material for the years ended December 31, 2022 and 2021.

Property and Equipment

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The assets acquired and liabilities assumed are recorded based on their respective fair values at the date of acquisition.

Long-lived assets (principally rental equipment), goodwill and other intangible assets generally represent the largest components of our acquisitions.

Long-lived assets

(principally rental equipment), goodwill and other intangible assets generally represent the largest components of our acquisitions.

Rental equipment is valued utilizing either a cost, market or income approach, or a combination of certain of these methods, depending on the asset being valued and the availability of market or income data.

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In connection with our goodwill impairment test that was conducted as of October 1, 2024, we bypassed the optional qualitative assessment for each reporting unit and quantitatively compared the fair values of our reporting units with their carrying amounts.

Our goodwill impairment testing as of this date indicated that all of our reporting units, including our Matting Solutions reporting unit, which was created following the March 2024 acquisition of Yak that is discussed in note 4 to the consolidated financial statements and which includes the assets acquired in the Yak acquisition, and our Mobile Storage reporting unit, which is discussed below associated with the goodwill impairment test that was conducted as of October 1, 2023, had estimated fair values which exceeded their respective carrying amounts by at least 60 percent.

In connection with our goodwill impairment test that was conducted as of October 1, 2023, we bypassed the optional qualitative assessment for each reporting unit and quantitatively compared the fair values of our reporting units with their carrying amounts.

Our goodwill impairment testing as of this date indicated that all of our reporting units, excluding our Mobile Storage reporting unit, had estimated fair values which exceeded their respective carrying amounts by at least 54 percent.

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As all of the assets in the Mobile Storage reporting unit were recorded at fair value as of the May 2021 acquisition date, we expected the percentage by which the fair value for this reporting unit exceeded the carrying value to be significantly less than the equivalent percentages determined for our other reporting units.

In connection with our goodwill impairment test that was conducted as of October 1, 2022, we bypassed the optional qualitative assessment for each reporting unit and quantitatively compared the fair values of our reporting units with their carrying amounts.

We completed the acquisition of General Finance in May 2021, and all of the assets in the Mobile Storage reporting unit were acquired in the General Finance acquisition.

The estimated fair value of our Mobile Storage reporting unit exceeded its carrying

amount by eight percent.

As all of the assets in the Mobile Storage reporting unit were recorded at fair value as of the May 2021 acquisition date, we expected the percentages by which the fair values for this reporting unit exceeded the carrying value to be significantly less than the equivalent percentages determined for our other reporting units.

Other Intangible Assets

1 unchanged sentence

The non-compete agreements are being amortized on a straight-line basis over initial periods of approximately five years .

The customer relationships are being amortized either using the sum of the years' digits method or on a straight-line basis over initial periods generally ranging from eight to 15 years.

The trade names and associated trademarks are being amortized using the sum of the years' digits method over initial periods of approximately five years.

The customer relationships are being amortized either using the sum of the years' digits method or on a straight-line basis over initial periods generally ranging from six to 15 years.

The trade names and associated trademarks are being amortized using the sum of the years' digits method over initial periods of approximately three years .

We believe that the amortization methods used reflect the estimated pattern in which the economic benefits will be consumed.

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New Accounting Pronouncements

Improvements to Reportable Segment Disclosures.

In November 2023, the FASB issued ASU 2023-07, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

The amendments in the ASU require, among other things, disclosure of significant segment expenses that are regularly provided to an entity's chief operating decision maker (“CODM”) and a description of other segment items (the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss) by reportable segment, as well as disclosure of the title and position of the CODM, and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources.

Annual disclosures are required for fiscal years beginning after December 15, 2023 and interim disclosures are required for periods within fiscal years beginning after December 15, 2024.

Retrospective application is required, and early adoption is permitted.

These requirements are not expected to have an impact on our financial statements, but will result in significantly expanded reportable segment disclosures.

Improvements to Income Tax Disclosures.

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These requirements are not expected to have an impact on our financial statements, but will impact our income tax disclosures.

Disaggregation of Income Statement Expenses.

In November 2024, the FASB issued ASU 2024-03, which requires more detailed disclosures about specified categories of expenses (including employee compensation, depreciation, and amortization) included in certain expense captions presented on the face of the income statement.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027, may be applied prospectively or retrospectively, and allows for early adoption.

We are currently assessing the impact this standard will have on our financial statements.

Accounting Guidance Adopted in 2024

Reference Rate Reform .

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary optional expedients and exceptions to accounting guidance on contract modifications and hedge accounting to ease entities’ financial reporting burdens as the market transitions from the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates.

This guidance generally allows for contract modifications solely related to the replacement of the reference rate to be accounted for as a continuation of the existing contract instead of as an extinguishment of the contract, without triggering certain accounting impacts that could be required associated with an extinguishment of the contract.

In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848):

Scope, to expand the scope of this guidance to include derivatives.

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848, which extends the period of time entities can utilize the reference rate reform relief guidance under ASU 2020-04 from December 31, 2022, to December 31, 2024.

In April 2023, our term loan facility was amended to transition to an interest rate based on the Secured Overnight Financing Rate ("SOFR").

Prior to the amendment, interest on the term loan facility reflected LIBOR plus a margin (or an alternative base rate plus a margin).

We applied the above guidance when accounting for the term loan facility amendment, and adoption of this guidance did not have a material impact on our financial statements.

As of December 31, 2023, we have no debt instruments that use LIBOR as a reference rate, and this guidance is not expected to have a material impact on our financial statements in the future.

Improvements to Reportable Segment Disclosures.

In November 2023, the FASB issued ASU 2023-07, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

Annual disclosures are required for fiscal years beginning after December 15, 2023 and interim disclosures are required for periods within fiscal years beginning after December 15, 2024.

We have adopted this guidance, which did not have an impact on our financial statements, although it did result in expanded reportable segment disclosures, which are included in note 5 to our consolidated financial statements.

Revenue Recognition

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By way of example, if a customer were to rent a piece of equipment and the daily, weekly and monthly rental rates for that particular piece were (in actual dollars) $100, $300 and $900, respectively, we would recognize revenue of $32.14 per day.

The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term

The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term of 28 days.

This daily rate assumes that the equipment will be on rent for the full 28 days, as we are unsure of when the customer will return the equipment and therefore unsure of which rental contract period will apply.

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Our largest customer accounted for less than one percent of total revenues in each of 2024, 2023, and 2022.

Our customer with the largest receivable balance represented approximately one percent of total receivables at December 31, 2023 and 2022.

Our customer with the largest receivable balance represented approximately two percent and one percent of total receivables at December 31, 2024 and 2023, respectively.

We manage credit risk through credit approvals, credit limits and other monitoring procedures.

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We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover.

Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less.

Most of our revenue is recognized at a point-in-time or over a period of

one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less.

Contract estimates and judgments

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We monitor and review our estimated standalone selling prices on a regular basis.

On December 7, 2022, we completed the acquisition of assets of Ahern Rentals, Inc.

("Ahern Rentals"), which was accounted for as a business combination.

Ahern Rentals was the eighth largest equipment rental company in North America and served customers primarily in the construction and industrial sectors across 30 states.

On March 15, 2024, we completed the acquisition of Yak Access, LLC, Yak Mat, LLC and New South Access & Environmental Solutions, LLC (collectively, “Yak”).

Yak was a leader in the North American matting industry with a fleet of approximately 600,000 hardwood, softwood, and composite mats that provide surface protection across both construction and maintenance, repair and operations (“MRO”) applications, and served customers primarily in the industrial sector across over 40 states.

The acquisition:

• Increased capacity in key geographies, with concentrations on both U.S.

coasts and in the Gulf region;

• Increased availability of high-demand aerial and material handling equipment for our customers;

• Created immediate cross-sell opportunities to an expanded customer base.

The aggregate consideration paid to acquire Ahern Rentals was $ 1.988 billion.

The acquisition and related fees and expenses were funded through the issuance of $ 1.5 billion principal amount of 6 percent Senior Secured Notes and drawings on our senior secured asset-based revolving credit facility (“ABL facility”).

During the year ended December 31, 2023, we recognized measurement period adjustments primarily to establish the fair values for intangible assets and lease assets and liabilities.

These adjustments resulted in a substantial reduction to goodwill versus the previously reported amount (see note 9 to the consolidated financial statements for further discussion of goodwill changes).

Non-rental depreciation and amortization for the year ended December 31, 2023 includes $ 7 of intangible asset amortization that would have been recognized in 2022 if the intangible asset values had been established as of December 31, 2022.

The following table summarizes the fair values of the assets acquired and liabilities assumed.

Inventory $ 20

• Provided entry into the matting market via an industry leader with established scale across fleet, operations, and talent;

• Augmented exposure to the energy and power verticals, where significant investment is expected over the next several decades;

• Enhanced our one-stop-shop value proposition with immediate cross-selling opportunities to existing and new construction and MRO customers.

The acquisition date fair value of the purchase price to acquire Yak was $ 1.158 billion, comprised of cash and $ 41 of estimated contingent consideration ($ 50 is the maximum amount of contingent consideration) that could become payable to the seller based on revenue attainment in the first two years after closing.

The acquisition and related fees and expenses were funded through the issuance of $ 1.100 billion principal amount of 6 1 / 8 Senior Notes (see note 12 to the consolidated financial statements for further information) and drawings on our senior secured asset-based revolving credit facility (“ABL facility”).

The table below summarizes the fair values of the assets acquired and liabilities assumed.

The purchase price allocations for these assets and liabilities are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period, although we do not expect material future changes.

Accounts receivable (1) $ 99

Rental equipment 127

Property and equipment 28

Intangible assets (1) 428

Intangible assets (customer relationships) (2) 150

Operating lease right-of-use assets 4

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Operating lease liabilities ( 4 )

Debt (finance leases) ( 38 )

Total liabilities assumed ( 104 )

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Net assets acquired $ 1,158

(1) The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

Fair value Life (years)

Customer relationships $ 330 9

Non-compete agreements 98 5

(2) All of the goodwill was assigned to our general rentals segment.

The level of goodwill that resulted from the acquisition is primarily reflective of Ahern Rentals' going-concern value, the value of Ahern Rentals' assembled workforce and new customer relationships expected to arise from the acquisition.

All of the goodwill is expected to be deductible for income tax purposes (because the acquisition is a purchase of assets, the goodwill that is deductible for income tax purposes equals the total acquired goodwill).

___________________

(1) The estimated fair value of accounts receivables acquired was $ 99 , and the gross contractual amount was $ 102 .

We estimated that $ 3 would be uncollectible.

(2) The customer relationships are being amortized over a 6 year life.

(3) All of the goodwill was assigned to our specialty segment.

As noted above, we have not yet obtained all the information required to finalize the valuations of the assets acquired and liabilities assumed.

As such, goodwill could change from the amount noted above, although we do not expect material future changes.

Once finalized, we expect that the goodwill that results from the acquisition will be primarily reflective of Yak's going-concern value, the value of Yak's assembled workforce and new customer relationships expected to arise from the acquisition.

All of the goodwill is expected to be deductible for income tax purposes (because the acquired Yak entities were sold as disregarded entities, the acquisition was treated as an asset purchase for income tax purposes, which resulted in the goodwill that is deductible for income tax purposes equaling the total acquired goodwill).

The debt issuance costs associated with the issuance of debt to partially fund the acquisition are reflected, net of amortization subsequent to the acquisition date, in long-term debt in our consolidated balance sheets.

Additionally, in the first quarter of 2023, we initiated a restructuring program following the closing of the Ahern Rentals acquisition, and the costs under this program are included in “Restructuring charge” in our consolidated statements of income.

The restructuring charges generally involve the closure of a large number of branches over a short period of time, often in periods following a major acquisition.

It is not practicable to reasonably estimate the amounts of revenue and earnings of Ahern Rentals since the acquisition date, primarily due to the movement of fleet between URI locations and the acquired Ahern Rentals locations, as well as our corporate structure and the allocation of corporate costs.

The total post-acquisition revenue attributable to the acquired Yak locations was $ 322 for the year ended December 31, 2024.

It is not practicable to reasonably estimate the amount of earnings of Yak since the acquisition date, primarily due to our corporate structure and the allocation of corporate costs.

Pro forma financial information

The pro forma information below gives effect to the Ahern Rentals acquisition as if it had been completed on January 1, 2021.

The pro forma information below gives effect to the Yak acquisition as if it had been completed on January 1, 2023.

The pro forma information is not necessarily indicative of our results had the acquisition been completed on the above date, nor is it necessarily indicative of our future results.

The pro forma information reflects Ahern Rentals’ historic revenue presented in accordance with our revenue mapping, does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition, and also does not reflect additional revenue opportunities following the acquisition.

The table below presents unaudited pro forma consolidated income statement information as if Ahern Rentals had been included in our consolidated results for the entire period reflected:

The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition and also does not reflect additional revenue opportunities following the acquisition.

The pro forma information includes adjustments to record the acquired assets and liabilities of Yak at their respective fair values and to give effect to the financing for the acquisition.

The pro forma adjustments reflected in the table below are subject to change as additional analysis is performed.

The purchase price allocations for the assets acquired and liabilities assumed are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period, although we do not expect material future changes.

Increases or decreases in the estimated fair values of the net assets acquired may impact our statements of income in future periods.

The table below presents unaudited pro forma consolidated income statement information as if Yak had been included in our consolidated results for the entire periods reflected:

United Rentals historic revenues (1) $ 15,345 $ 14,332

Ahern Rentals historic revenues 827

Yak historic revenues (2) 97 353

Pro forma revenues (1) 15,442 14,685

United Rentals historic pretax income 3,388 3,211

Ahern Rentals historic pretax income 2

Yak historic pretax income 10 54

Combined pretax income 3,398 3,265

1 unchanged sentence

Impact of fair value mark-ups/useful life changes on depreciation (3) 1 6

Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales (2) ( 28 )

Intangible asset amortization (4) 1 ( 19 )

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Elimination of historic interest (6) 11 66

Elimination of historic legal and financing costs (6) 11

Elimination of refinancing transactions (7) ( 40 ) ( 101 )

Transaction bonuses and other (8) 22 3

Pro forma pretax income $ 3,379 $ 3,151

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(1) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups, and the changes in useful lives and salvage values, of the equipment acquired in the Ahern Rentals acquisition.

(2) Cost of rental equipment sales was adjusted for the fair value mark-ups, and the changes in useful lives and salvage values, of rental equipment acquired in the Ahern Rentals acquisition.

(1) United Rentals historic revenue for the year ended December 31, 2024 includes the post-acquisition revenue attributable to the acquired Yak locations of $ 322 that is discussed above.

Pro forma revenue for the year ended December 31, 2024 includes $ 419 of pre/post-acquisition revenue from the acquired Yak locations, comprised of $ 97 of historic Yak revenue and $ 322 of post-acquisition revenue attributable to the acquired Yak locations.

(2) Yak revenue reflects only the historical results of the entities being acquired, and includes an estimate of revenue from mat rentals to a commonly controlled entity that were eliminated in consolidation by Yak.

(3) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups of the equipment acquired in the Yak acquisition.

There were no material changes to the useful lives and salvage values of the acquired equipment.

(4) Intangible asset amortization was adjusted to include amortization of the acquired intangible assets.

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(6) Historic interest on debt that is not part of the combined entity was eliminated.

(6) Reflects legal and financing costs incurred by Ahern Rentals that do not relate to the combined entity (specifically, legal costs related to a particular lawsuit and costs related to an attempted financing).

In addition to the Ahern Rentals acquisition, during 2023 and 2022, we completed a series of acquisitions which were not significant individually or in the aggregate.

See the consolidated statements of cash flows for the total cash outflow for purchases of other companies, net of cash acquired, which includes Ahern Rentals and the other completed acquisitions, and see note 9 to our consolidated financial statements for rollforwards showing the goodwill acquired associated with these acquisitions.

(7) Reflects gains on the extinguishment of debt, net of refinancing transaction expenses.

(8) Primarily reflects bonuses paid in connection with the acquisition.

In addition to the Yak acquisition, during 2024 and 2023, we completed a series of acquisitions which were not significant individually or in the aggregate.

In 2022, we completed the acquisition of assets of Ahern Rentals, Inc.

(“Ahern Rentals”), which was accounted for as a business combination.

Disclosures addressing the Ahern Rentals acquisition were included in our Annual Report on Form 10-K for the year ended December 31, 2023.

See the consolidated statements of cash flows for the total cash outflow for purchases of other companies, net of cash acquired, which includes Yak, Ahern Rentals and the other completed acquisitions, and see note 9 to our consolidated financial statements for rollforwards showing the goodwill acquired associated with these acquisitions.

Segment Information

Our reportable segments are (i) general rentals and (ii) specialty.

In the fourth quarter of 2021, following a realignment of certain of our divisions and regions, and changes in leadership roles and responsibilities, we updated our analysis of operating segments and concluded that our divisions represent our operating segments.

Prior to the fourth quarter of 2021, our regions were our operating segments.

While this update reflects a change in operating segments, it did not result in any changes to the rental locations in each reportable segment, and, as a result, there were no changes to the historically reported segment financial information.

Our determination of the operating segments is primarily based on geography, but also includes consideration of the offered products and services.

As noted below, we evaluate segment performance primarily based on segment equipment rentals gross profit.

The primary change resulting from the change in segment presentation is to our ongoing review of segment equipment rentals margins, which we monitor on a quarterly basis to assess margin similarity between operating segments.

Because of the change in operating segments, this margin analysis is now conducted at the division level, while it was historically (prior to the realignment in the fourth quarter of 2021) performed at the region level.

As discussed further in note 2 to our consolidated financial statements ("Evaluation of Goodwill Impairment"), we test for goodwill impairment at the reporting unit (the region, which is one level below the operating segment (division)) level, and the change in the segment structure did not impact our goodwill impairment testing.

As discussed further in note 2 to our consolidated financial statements (“Evaluation of Goodwill Impairment”), we test for goodwill impairment at the reporting unit (the region, which is one level below the operating segment (division)) level.

For general rentals, the divisions discussed below, which are our operating segments, are aggregated into the reportable segment.

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The general rentals segment reflects the aggregation of four geographic divisions—Central, Northeast, Southeast and West—and operates throughout the United States and Canada.

The specialty segment, which, as noted above, is a single division that is both an operating segment and a reportable segment, rents products (and provides setup and other services on such rented equipment) including i) trench safety equipment, such as trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers and line testing equipment for underground work, ii) power and HVAC equipment, such as portable diesel generators, electrical distribution equipment, and temperature control equipment, iii) fluid solutions equipment primarily used for fluid containment, transfer and treatment, and iv) mobile storage equipment and modular office space.

The specialty segment, which, as noted above, is a single division that is both an operating segment and a reportable segment, rents products (and provides setup and other services on such rented equipment) including (i) trench safety equipment, such as trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers and line testing equipment for underground work, (ii) power and HVAC equipment, such as portable diesel generators, electrical distribution equipment, and temperature control equipment, (iii) fluid solutions equipment primarily used for fluid containment, transfer and treatment, (iv) mobile storage equipment and modular office space and (v) surface protection mats.

The specialty segment’s customers include construction companies involved in infrastructure projects, municipalities and industrial companies.

This segment primarily operates in the United States and Canada, and has a limited presence in Europe, Australia and New Zealand.

This segment primarily operates in the United States and Canada, and has a smaller presence in Europe, Australia and New Zealand.

The following table presents the percentage of equipment rental revenue by equipment type for the years ended December 31, 2024, 2023 and 2022:

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Mobile storage equipment and modular office space

Surface protection mats (1) 2 % — % — %

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(1) As discussed in note 4 to the consolidated financial statements, in March 2024, we completed the acquisition of Yak, which was a leading provider of surface protection mats.

Prior to the Yak acquisition, we did not rent material amounts of such equipment.

The accounting policies for our segments are the same as those described in the summary of significant accounting policies in note 2.

Certain corporate costs, including those related to selling, finance, legal, risk management, human resources, corporate management and information technology systems, are deemed to be of an operating nature and are allocated to our segments based primarily on rental fleet size.

The following table sets forth financial information by segment as of, and for the years ended, December 31, 2023, 2022 and 2021:

Our Chief Operating Officer is our CODM.

Equipment rentals gross profit is the primary measure the CODM utilizes in assessing segment performance and determining the allocation of resources.

The CODM is the primary individual in control of resource allocation, and the allocation determinations are made in consultation with our senior executive committee, of which the CODM is a member.

The most significant allocation determinations made by the CODM pertain to purchases of rental equipment (see the table below for total capital expenditures, including rental and non-rental equipment, by segment), and these determinations are generally made as part of the annual budgeting process, with regular reviews occurring throughout the year that can result in allocation changes (for example, if a specific division outperforms its plan, that could result in a reallocation of resources between divisions or an increase in the total allocated resources).

On a monthly basis, the CODM considers budget-to-actual variances for equipment rentals gross profit when making decisions about allocating capital to the segments.

Equipment rentals gross profit is also used to assess the performance for each segment by comparing the results and return on assets of each segment with one another, which also informs the determinations made pertaining to the allocation of resources.

The following table sets forth financial information by segment, and includes a reconciliation of the primary measure of segment profit (equipment rentals gross profit) to income before provision for income taxes.

Year Ended December 31,

2024 2023 2022

rentals Specialty Total General

rentals Specialty Total

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Total revenue (1) 10,845 4,500 15,345 10,697 3,635 14,332 8,584 3,058 11,642

Depreciation and amortization expense 2,316 465 2,781

Equipment rentals gross profit 3,219 1,595 4,814

Capital expenditures 3,051 813 3,864

Total assets $ 20,411 $ 5,178 $ 25,589

Equipment rentals $ 7,345 $ 2,771 $ 10,116

Sales of rental equipment 835 130 965

Sales of new equipment 73 81 154

Contractor supplies sales 81 45 126

Service and other revenues 250 31 281

Total revenue 8,584 3,058 11,642

Depreciation and amortization expense 1,765 452 2,217

Equipment rentals gross profit 2,905 1,340 4,245

Equipment rentals gross profit (see calculation below) 3,232 1,966 5,198 3,219 1,595 4,814 2,905 1,340 4,245

Equipment rentals gross margin 36.1 % 48.1 % 39.9 % 36.6 % 48.9 % 39.9 % 39.6 % 48.4 % 42.0 %

Capital expenditures (2) 3,102 1,028 4,130 3,051 813 3,864 2,868 822 3,690

Total assets $ 19,604 $ 4,579 $ 24,183

Calculation of equipment rentals gross profit:

Equipment rentals 8,945 4,084 13,029 8,803 3,261 12,064 7,345 2,771 10,116

Sales of rental equipment 862 106 968

Sales of new equipment 142 61 203

Contractor supplies sales 71 38 109

Service and other revenues 202 27 229

Total revenue 7,351 2,365 9,716

Depreciation and amortization expense 1,611 372 1,983

Depreciation of rental equipment ( 1,968 ) ( 498 ) ( 2,466 ) ( 1,989 ) ( 361 ) ( 2,350 ) ( 1,521 ) ( 332 ) ( 1,853 )

Significant/all other rental expenses (3):

Labor and benefits (4) ( 1,576 ) ( 442 ) ( 2,018 ) ( 1,519 ) ( 377 ) ( 1,896 ) ( 1,237 ) ( 316 ) ( 1,553 )

Repairs and maintenance ( 830 ) ( 211 ) ( 1,041 ) ( 827 ) ( 176 ) ( 1,003 ) ( 645 ) ( 147 ) ( 792 )

Delivery ( 472 ) ( 350 ) ( 822 ) ( 448 ) ( 269 ) ( 717 ) ( 375 ) ( 236 ) ( 611 )

All other rental expenses (3) ( 867 ) ( 617 ) ( 1,484 ) ( 801 ) ( 483 ) ( 1,284 ) ( 662 ) ( 400 ) ( 1,062 )

Equipment rentals gross profit 3,232 1,966 5,198 3,219 1,595 4,814 2,905 1,340 4,245

Capital expenditures 2,719 479 3,198

Total assets $ 16,087 $ 4,205 $ 20,292

Equipment rentals gross profit is the primary measure management reviews to make operating decisions and assess segment performance.

The following is a reconciliation of equipment rentals gross profit to income before provision for income taxes:

Year Ended December 31,

2023 2022 2021

Total equipment rentals gross profit

$ 4,814 $ 4,245 $ 3,267

Reconciliation of equipment rentals gross profit to income before provision for income taxes:

Gross profit from other lines of business 952 999 751

Selling, general and administrative expenses ( 1,645 ) ( 1,527 ) ( 1,400 )

( 1,527 ) ( 1,400 ) ( 1,199 )

Merger related costs (1) — — ( 3 )

Restructuring charge (5) ( 3 ) ( 28 ) —

Non-rental depreciation and amortization ( 437 ) ( 431 ) ( 364 )

( 431 ) ( 364 ) ( 372 )

Interest expense, net ( 691 ) ( 635 ) ( 445 )

( 635 ) ( 445 ) ( 424 )

Other income (expense), net 19 15 ( 7 )

Other income, net 14 19 15

Income before provision for income taxes $ 3,388 $ 3,211 $ 2,802

2024 December 31,

2023 December 31,

rentals Specialty Total General

rentals Specialty Total

Total assets (6) $ 21,044 $ 7,119 $ 28,163 $ 20,411 $ 5,178 $ 25,589 $ 19,604 $ 4,579 $ 24,183

___________________

(1) Reflects transaction costs associated with the General Finance acquisition that was completed in May 2021.

Merger related costs only include costs associated with major acquisitions that significantly impact our operations.

(2) Primarily relates to branch closure charges and severance costs associated with our restructuring programs.

(1) Includes immaterial intersegment revenues.

(2) The consolidated statements of cash flows include the payments for capital expenditures, while the table above reflects the gross capital expenditures.

Accounts payable as of December 31, 2024 and December 31, 2023 included $ 77 and $ 74 , respectively, of amounts due but unpaid for purchases of rental equipment.

The net impact of accrued purchases of rental equipment was no t material for the year ended December 31, 2022.

(3) The significant expense categories align with the segment-level information that is regularly provided to the CODM.

The “all other rental expenses” category reflects the difference between equipment rentals revenue less the significant expense categories above and the primary measure of segment profit (equipment rentals gross profit), and is primarily comprised of property costs, costs associated with re-rent revenue and certain ancillary revenues (see note 3 to the consolidated financial statements for a discussion of the different types of equipment rentals revenue), and insurance costs.

Intersegment expenses are included within the amounts shown.

(4) Labor and benefits includes all internal labor and benefits costs associated with equipment rentals, including labor and benefits costs associated with repairs and maintenance and delivery.

(5) Primarily reflects severance and branch closure charges associated with our restructuring programs.

The restructuring charges generally involve the closure of a large number of branches over a short period of time, often in periods following a major acquisition.

The amounts above primarily reflect charges associated with the restructuring program initiated following the December 2022 acquisition of Ahern Rentals.

As of December 31, 2024, there were no open restructuring programs.

We primarily operate in the United States and Canada, and have a limited presence in Europe, Australia and New Zealand.

(6) The increase in the specialty segment assets from December 31, 2023 to December 31, 2024 includes the impact of the Yak acquisition discussed in note 4 to the consolidated financial statements.

We primarily operate in the United States and Canada, and have a smaller presence in Europe, Australia and New Zealand.

The foreign information in the table below primarily reflects Canada.

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See note 2 (“Advertising Expense”) for further detail.

(3) Primarily relates to tax depreciation benefits associated with the Ahern Rentals acquisition discussed in note 4 to the consolidated financial statements.

The tax depreciation deductions generated by the Ahern Rentals acquisition resulted in an income tax receivable associated with U.S.

federal and state tax payments made prior to the acquisition.

The decrease reflected above from December 31, 2022 to December 31, 2023 reflects the use of a portion of the receivable to reduce cash paid for income taxes.

(3) The increase above from December 31, 2023 to December 31, 2024 was primarily due to an increase in income taxes receivable which reflected required tax payments exceeding the estimated tax accruals.

(4) Includes multiple items, none of which are individually significant.

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Property and equipment, net

$ 1,034 $ 903

Goodwill and Other Intangible Assets

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Decreases in goodwill related to acquisitions above primarily reflect such measurement period adjustments.

(3) For additional detail on the December 2022 acquisition of Ahern Rentals, which was assigned to our general rentals segment and accounted for most of the goodwill related to acquisitions in 2022, see note 4 to our consolidated financial statements.

The decrease in goodwill related to acquisitions for the general rentals segment in 2023 primarily reflects measurement period adjustments associated with the Ahern Rentals acquisition, partially offset by other acquisition activity.

(3) The December 2022 acquisition of Ahern Rentals was assigned to our general rentals segment and accounted for most of the goodwill related to acquisitions in 2022.

The decrease in goodwill related to acquisitions for the general rentals segment in 2023 primarily reflected measurement period adjustments associated with the Ahern Rentals acquisition, partially offset by other acquisition activity.

For additional detail on the March 2024 acquisition of Yak, which was assigned to our specialty segment and accounted for most of the goodwill related to acquisitions in 2024, see note 4 to our consolidated financial statements.

Other intangible assets were comprised of the following at December 31, 2024 and 2023:

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Trade names and associated trademarks 2 years $ 9 $ 6 $ 3

Our other intangibles assets, net at December 31, 2023 include the assets set forth in the table below associated with the acquisition of Ahern Rentals that is discussed in note 4 to our consolidated financial statements.

Our other intangibles assets, net at December 31, 2024 include the assets set forth in the table below associated with the acquisition of Yak that is discussed in note 4 to our consolidated financial statements.

No residual value has been assigned to these assets.

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Amortization Period Net Carrying

Non-compete agreements 4 years 77

Customer relationships 5 years 118

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Accrued compensation and benefit costs

Contingent consideration (1) 24 —

Other long-term liabilities

_________________

(1) Primarily reflects the long-term portion of the contingent consideration for the Yak acquisition that is discussed in note 4 to the consolidated financial statements.

Fair Value Measurements

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The carrying amounts reported in our consolidated balance sheets for accounts receivable, accounts payable and accrued expenses and other liabilities approximate fair value due to the immediate to short-term maturity of these financial instruments.

The fair values of our variable rate debt facilities and finance leases approximated their book values as of December 31, 2023

The fair values of our variable rate debt facilities and finance leases approximated their book values as of December 31, 2024 and 2023.

The estimated fair values of our other financial instruments, all of which are categorized in Level 1 of the fair value hierarchy, as of December 31, 2024 and 2023 have been calculated based upon available market information, and were as follows:

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Debt, net of unamortized original issue premiums and unamortized debt issuance costs, consists of the following:

Repurchase facility expiring 2024 (1) $ 100 $ 100

Repurchase facility (terminated in 2024) (1) $ — $ 100

Accounts receivable securitization facility expiring 2025 (1) 1,085 1,300

Term loan facility expiring 2025 (1) 945 953

$ 4.25 billion ABL facility expiring 2027 (1)

Term loan facility expiring 2031 (1) 984 945

5 1 / 2 percent Senior Notes due 2027

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3 3 / 4 percent Senior Notes due 2032

6 1 / 8 percent Senior Notes due 2034 (3)

Finance leases 263 192

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(1) The table below presents financial information associated with our variable rate indebtedness as of and for the year ended December 31, 2024.

There is no borrowing capacity under the repurchase facility because it is an uncommitted facility.

The repurchase facility is not included below because (i) there were no borrowings under it during the year ended December 31, 2024 and (ii) it was terminated in May 2024.

We have borrowed the full available amount under the term loan facility.

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The average amount of debt outstanding under the term loan facility decreases slightly each quarter due to the requirement to repay a portion of the principal obligation.

ABL facility Accounts receivable securitization facility Term loan facility Repurchase facility

ABL facility Accounts receivable securitization facility Term loan facility

Borrowing capacity, net of letters of credit

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(2) URNA separately issued 4 7 / 8 percent Senior Notes in August 2017 and in September 2017.

Following the issuances, URNA consummated an exchange offer pursuant to which most of the 4 7 / 8 percent Senior Notes issued in September

2017 were exchanged for additional notes fungible with the 4 7 / 8 percent Senior Notes issued in August 2017.

Following the issuances, URNA consummated an exchange offer pursuant to which most of the 4 7 / 8 percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 7 / 8 percent Senior Notes issued in August 2017.

As of December 31, 2024, the total above is comprised of two separate 4 7 / 8 percent Senior Notes, one with a book value of $ 1.663 billion and one with a book value of $ 4 .

(3) In March 2024, URNA issued $ 1.100 billion aggregate principal amount of 6 1 / 8 percent Senior Notes.

See below for additional detail on the issued debt.

(4) As of December 31, 2024, short-term debt primarily reflected borrowings under the accounts receivable securitization facility and the short-term portion of our finance leases.

As of December 31, 2023, short-term debt primarily reflected borrowings under the accounts receivable securitization and repurchase facilities and the short-term portion of our finance leases.

As of December 31, 2022, short-term debt primarily reflected borrowings under the repurchase facility and the short-term portion of our finance leases.

The accounts receivable securitization facility, which expires on June 24, 2024 and may be extended on a 364 -day basis by mutual agreement with the purchasers under the facility, was not a short-term debt instrument as of December 31, 2022.

The accounts receivable securitization facility, which expires on June 24, 2025, may be extended on a 364 -day basis by mutual agreement with the purchasers under the facility.

The weighted average interest rates on our short-term debt, excluding finance leases, were 5.4 percent and 6.4 percent as of December 31, 2024 and 2023, respectively.

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Short-term debt

As of December 31, 2023, our short-term debt primarily reflects borrowings under the repurchase and accounts receivable securitization facilities and the short-term portion of our finance leases.

Repurchase facility.

In June 2022, URNA entered into an uncommitted repurchase facility pursuant to which it may obtain short-term financing in an amount up to $ 100 , secured by a subordinated note issued to URNA by our U.S.

special purpose vehicle which holds receivable assets relating to our accounts receivable securitization facility.

In 2023, the repurchase facility was amended, primarily to extend the maturity date to June 14, 2024, which may be further extended by the mutual consent of the parties to the repurchase facility agreement.

Additionally, the repurchase facility was amended to replace an interest rate based on SOFR with an interest rate based on the Bloomberg Short Term Bank Yield Index ("BSBY").

Any repurchase transaction will have a one-month maturity unless terminated earlier as a result of a termination event under the accounts receivable securitization facility or the occurrence of any other event of default under the repurchase facility.

The Company will guarantee the obligations of URNA under the repurchase facility.

See the table above for financial information associated with the repurchase facility.

Accounts receivable securitization facility.

The accounts receivable securitization facility expires on June 24, 2025 and may be extended on a 364 -day basis by mutual agreement with the purchasers under the facility.

Borrowings under the accounts receivable securitization facility bear interest based on SOFR.

In 2023, the accounts receivable securitization facility was amended, primarily to increase the facility size to $ 1.3 billion.

Borrowings under the accounts receivable securitization facility bear interest based on (i) the cost of commercial paper issued by a conduit purchaser to fund its investment, plus related dealer commissions and note issuance costs or, (ii) if funded by a bank, the Secured Overnight Financing Rate (“SOFR”).

In 2024, the accounts receivable securitization facility was amended, primarily to increase the facility size to $ 1.5 billion and to extend the maturity date.

Key provisions of the facility include the following:

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(i) in the case of loans in U.S.

dollars, at a rate equal to the term SOFR or daily SOFR (in each case plus a 0.10 percent credit margin adjustment) or an alternate base rate, in each case plus a spread, (ii) in the case of loans in Canadian dollars, at a rate equal to the Canadian prime rate or an alternate rate (Bankers' Acceptance Rate), in each case plus a spread, (iii) in the case of loans in Euros, at a rate equal to the Euro interbank offered rate or an alternate base

rate, in each case plus a spread, (iv) in the case of loans in British pounds, at a rate equal to the daily simple Sterling Overnight Interbank Average or an alternate base rate, in each case plus a spread or (v) in the case of loans in Australian Dollars or New Zealand Dollars, at a rate equal to the applicable bank bill rate or an alternate base rate, in each case plus a spread.

dollars, at a rate equal to the term SOFR or daily SOFR (in each case plus a 0.10 percent credit margin adjustment) or an alternate base rate, in each case plus a spread, (ii) in the case of loans in Canadian dollars, at a rate equal to the Term Canadian Overnight Repo Rate Average (“Term CORRA”) or an alternate rate (the Canadian prime rate), in each case plus a spread, (iii) in the case of loans in Euros, at a rate equal to the Euro interbank offered rate or an alternate base rate, in each case plus a spread, (iv) in the case of loans in British pounds, at a rate equal to the daily simple Sterling Overnight Interbank Average or an alternate base rate, in each case plus a spread or (v) in the case of loans in Australian Dollars or New Zealand Dollars, at a rate equal to the applicable bank bill rate or an alternate base rate, in each case plus a spread.

The interest rates under the credit agreement are subject to change based on the availability in the facility.

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subsidiaries (other than real property and certain accounts receivable) and substantially all the assets of URNA’s Canadian subsidiaries.

Under the ABL facility, a change of control (as defined in the credit agreement) constitutes an event of default, entitling our lenders, among other things, to terminate our ABL facility and to require us to repay outstanding borrowings.

Under the ABL facility, a change of control (as defined in the credit

agreement) constitutes an event of default, entitling our lenders, among other things, to terminate our ABL facility and to require us to repay outstanding borrowings.

Term loan facility .

In October 2018, Holdings, URNA, and certain of our subsidiaries entered into a $ 1 billion senior secured term loan facility.

In October 2018, Holdings, URNA, and certain of our subsidiaries entered into a senior secured term loan facility.

In 2024, the term loan facility was amended, primarily to extend the maturity date and to increase the facility size to $ 1.000 billion (at the time of the amendment, the facility size was $ 948 ).

See the table above for financial information associated with the term loan facility.

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The principal obligations under the term loan facility are to be repaid in quarterly installments in an aggregate amount equal to 1.0 percent per annum, with the balance due at the maturity of the term loan facility.

The term loan facility matures on October 31, 2025.

In 2023, the term loan facility was amended to transition to an interest rate based on SOFR.

Prior to the amendment, interest on the term loan facility reflected LIBOR plus a margin (or an alternative base rate plus a margin).

LIBOR has been discontinued as a reference rate as a result of reference rate reform, and the amendment of the term loan facility did not have a material impact on our financial statements.

The term loan facility matures on February 14, 2031.

Borrowings under the term loan facility bear interest based on SOFR.

The term loan facility contains customary negative covenants applicable to URNA and its subsidiaries, including negative covenants that restrict the ability of such entities to, among other things, (i) incur additional indebtedness;

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Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions.

The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of

the then-outstanding 5 1 / 2 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon.

The carrying value of the 5 1 / 2 percent Notes includes the $ 1 unamortized portion of the original issue premium recognized in conjunction with the February 2017 issuance, which is being amortized through the maturity date in 2027.

The effective interest rate on the 5 1 / 2 percent Notes, which includes the impact of the original issue premium, is 5.5 percent.

The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of the then-outstanding 5 1 / 2 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon.

3 7 / 8 percent Senior Secured Notes due 2027.

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Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions.

In addition, the covenant relating to dividends and other distributions, stock repurchases and redemptions and other restricted payments and the requirements relating to additional subsidiary guarantors will not apply to URNA and its restricted subsidiaries during any period when the Subsequent 4 7 / 8 percent Notes are rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances,

another rating agency selected by URNA, provided at such time no default under the indenture has occurred and is continuing.

The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of the then-outstanding Subsequent 4 7 / 8 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon.

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In addition, at any time on or prior to December 15, 2025, up to 40 percent of the aggregate principal amount of the 6 percent Notes may be redeemed with the net cash proceeds of certain equity offerings at a redemption price equal to 106.000 percent of the aggregate principal amount of the notes plus accrued and unpaid interest, if any.

The indenture governing the 6 percent Notes contains certain restrictive covenants, including, among others, limitations on (i) liens and (ii) mergers and consolidations, as well as a requirement to timely file periodic reports with the SEC.

The indenture governing the 6 percent Notes contains certain restrictive covenants, including, among others, limitations on (i) liens and (ii) mergers and

consolidations, as well as a requirement to timely file periodic reports with the SEC.

Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions.

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4 percent Senior Notes due 2030.

In February 2020, URNA issued $ 750 aggregate principal amount of 4 percent Notes which are due July 15, 2030.

The 4 percent Notes are unsecured and are guaranteed by Holdings and certain domestic

subsidiaries of URNA.

In February 2020, URNA issued $ 750 aggregate principal amount of 4 percent Senior Notes (the “4 percent Notes”) which are due July 15, 2030.

The 4 percent Notes are unsecured and are guaranteed by Holdings and certain domestic subsidiaries of URNA.

The 4 percent Notes may be redeemed on or after July 15, 2025, at specified redemption prices that range from 102.000 percent in 2025, to 100 percent in 2028 and thereafter, in each case, plus accrued and unpaid interest, if any.

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The indenture governing the 3 7 / 8 percent Notes contains certain restrictive covenants, including, among others, limitations on (i) liens and (ii) mergers and consolidations, as well as a requirement to timely file periodic reports with the SEC.

Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions.

Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its

subsidiaries to engage in these activities under certain conditions.

In addition, the requirements to provide subsidiary guarantees and to make an offer to repurchase the notes upon the occurrence of a change of control will not apply to URNA and its restricted subsidiaries during any period when the 3 7 / 8 percent Notes are rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances, another rating agency selected by URNA, provided at such time no default under the indenture has occurred and is continuing.

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The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of the then-outstanding 3 3 / 4 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon.

6 1 / 8 percent Senior Notes due 2034.

In March 2024, URNA issued $ 1.100 billion aggregate principal amount of 6 1 / 8 percent Senior Notes (the “6 1 / 8 percent Notes”) which are due March 15, 2034.

The 6 1 / 8 percent are unsecured and are guaranteed by Holdings and certain domestic subsidiaries of URNA.

The 6 1 / 8 percent may be redeemed on or after March 15, 2029, at specified redemption prices that range from 103.063 percent in 2029, to 100 percent in 2032 and thereafter, in each case, plus accrued and unpaid interest, if any.

At any time prior to March 15, 2029, URNA may, at its option, redeem some or all of the 6 1 / 8 percent Notes at a redemption price equal to 100 percent of the aggregate principal amount of the notes to be redeemed, plus a “make-whole” premium and accrued and unpaid interest, if any, to the redemption date.

In addition, at any time on or prior to March 15, 2027, up to 40 percent of the aggregate principal amount of the 6 1 / 8 percent Notes may be redeemed with the net cash proceeds of certain equity offerings at a redemption price equal to 106.125 percent of the aggregate principal amount of the notes plus accrued and unpaid interest, if any.

The indenture governing the 6 1 / 8 percent Notes contains certain restrictive covenants, including, among others, limitations on (i) liens and (ii) mergers and consolidations, as well as a requirement to timely file periodic reports with the SEC.

Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions.

In addition, the requirements to provide subsidiary guarantees and to make an offer to repurchase the notes upon the occurrence of a change of control will not apply to URNA and its restricted subsidiaries during any period when the 6 1 / 8 percent Notes are rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances, another rating agency selected by URNA, provided at such time no default under the indenture has occurred and is continuing.

The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of the then-outstanding 6 1 / 8 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon.

Loan Covenants and Compliance

As of December 31, 2023, we were in compliance with the covenants and other provisions of the ABL, accounts receivable securitization, term loan and repurchase facilities and the senior notes.

As of December 31, 2024, we were in compliance with the covenants and other provisions of the ABL, accounts receivable securitization and term loan facilities and the senior notes.

Any failure to be in compliance with any material provision or covenant of these agreements could have a material adverse effect on our liquidity and operations.

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When certain conditions are met, cash and cash equivalents and borrowing base collateral in excess of the ABL facility size may be included when calculating specified availability under the ABL facility.

As of December 31, 2023, specified availability under the ABL facility exceeded the required threshold and, as a result, this financial covenant was inapplicable.

As of December 31, 2024,

specified availability under the ABL facility exceeded the required threshold and, as a result, this financial covenant was inapplicable.

Under our accounts receivable securitization facility, we are required, among other things, to maintain certain financial tests relating to:

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_________________

(1) The increases in 2023 include the impact of the Ahern Rentals acquisition discussed in note 4 to the consolidated financial statements.

(1) The increases in 2024 reflect increased amounts of real estate and equipment leased under operating leases.

Lease cost Classification Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022

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Apart from these costs, short-term lease costs are immaterial.

(2) The increase in 2023 reflects the impact of a restructuring program initiated following the closing of the Ahern Rentals acquisition.

(2) The amounts above primarily reflect charges associated with a restructuring program initiated following the closing of the Ahern Rentals acquisition.

(3) Primarily reflects re-rent revenue as discussed further above.

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_________________

(1) The increases in 2023 include the impact of the Ahern Rentals acquisition discussed in note 4 to the consolidated financial statements.

(1) The increases in 2023 include the impact of the Ahern Rentals acquisition.

The components of the provision (benefit) for income taxes for each of the three years in the period ended December 31, 2024 are as follows:

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State and local ( 10 ) 17 28

( 19 ) 35 537

Total $ 813 $ 787 $ 697

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Net operating loss and credit carryforwards 71 97

Interest carryforward (1) — 84

Operating lease assets 343 287

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Intangibles ( 81 ) ( 85 )

Interest carryforward ( 2 ) —

Total deferred tax liability ( 3,319 ) ( 3,291 )

Total net deferred tax liability $ ( 2,685 ) $ ( 2,701 )

_________________

(1) Relates to the limitation of deductible interest, and is primarily due to tax depreciation benefits associated with the Ahern Rentals acquisition (see note 6 to the consolidated financial statements for further discussion of the tax depreciation benefits).

(2) Relates to federal foreign tax credits, state net operating loss carryforwards and state tax credits that may not be realized.

The following table summarizes the activity related to unrecognized tax benefits, some of which would impact our effective tax rate if recognized:

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Additions for tax positions of prior years 9 8 7

Lapse of statute of limitations ( 1 ) — —

Settlements ( 1 ) ( 1 ) ( 5 )

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We include interest accrued on the underpayment of income taxes in interest expense, net, and penalties, if any, related to unrecognized tax benefits in selling, general and administrative expense.

The amounts of such interest or penalties were no t material (approximately $1 or less) in each of the years ended December 31, 2023, 2022 and 2021.

The amounts of such interest or penalties were no t material ($5 or less) in each of the years ended December 31, 2024, 2023 and 2022.

We believe that it is reasonably possible that a decrease of up to $ 12 in federal and state unrecognized tax benefits may be necessary within the next year, as a result of settlements.

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Determination of the amount of unrecognized deferred tax liability on these unremitted earnings is not practicable.

We have net operating loss carryforwards (“NOLs”) of $ 57 for federal income tax purposes, $ 10 of which will expire in 2037 (while the remaining federal NOLs have an indefinite life), $ 15 for foreign income tax purposes (the majority of which has an indefinite life) and $ 425 for state income tax purposes that expire from 2024 through 2034.

We have no remaining net operating loss carryforwards (“NOLs”) for federal income tax purposes, $ 12 of NOLs for foreign income tax purposes (the majority of which has an indefinite life) and $ 278 of NOLs for state income tax purposes that expire from 2025 through 2034.

The European Union (“EU”) member states formally adopted the EU’s Pillar Two Directive, which was established by the Organization for Economic Co-operation and Development, and which generally provides for a 15 percent minimum effective tax rate for multinational enterprises, in every jurisdiction in which they operate.

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Earnings per share—diluted (2) 6.47 8.58 10.29 10.01 35.28

(1) Beginning in 2021 and continuing through 2023, we have experienced broad-based strength of demand across our end-markets.

The revenue increases above reflect this strong demand, as well as the impact of the December 2022 Ahern Rentals acquisition that is discussed in note 4 to the consolidated financial statements.

(2) There were no unusual or infrequently occurring items recognized in the fourth quarter of 2023 that had a material impact on our financial statements.

In the fourth quarter of 2022, we issued $ 1.5 billion principal amount of 6 percent Senior Secured Notes due 2029.

The issued debt, together with drawings on our ABL facility, was used to fund the December 2022 Ahern Rentals acquisition that is discussed in note 4 to the consolidated financial statements.

(1) There were no unusual or infrequently occurring items recognized in the fourth quarter of 2024 or 2023 that had a material impact on our financial statements.

(2) Diluted earnings per share includes the after-tax impacts of the following:

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Restructuring charge (6) ( 0.01 ) ( 0.01 ) ( 0.01 ) ( 0.01 ) ( 0.04 )

Asset impairment charge (7) ( 0.01 ) — ( 0.03 ) ( 0.01 ) ( 0.05 )

Loss on repurchase/redemption/amendment of debt ( 0.01 ) — — — ( 0.01 )

For the year ended December 31, 2023:

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Restructuring charge (6) ( 0.02 ) ( 0.20 ) ( 0.05 ) ( 0.04 ) ( 0.31 )

Asset impairment charge (8) — ( 0.02 ) ( 0.01 ) — ( 0.03 )

Loss on repurchase/redemption of debt securities (9) — ( 0.18 ) — — ( 0.18 )

(3) This reflects the amortization of the intangible assets acquired in the major acquisitions that significantly impact our operations (the “major acquisitions,” each of which had annual revenues of over $ 200 prior to acquisition).

The increases in 2023 primarily reflect the impact of the Ahern Rentals acquisition.

(4) This reflects the impact of extending the useful lives of equipment acquired in certain major acquisitions, net of the impact of additional depreciation associated with the fair value mark-up of such equipment.

The increases in 2023 primarily reflect the impact of the Ahern Rentals acquisition.

(5) This reflects additional costs recorded in cost of rental equipment sales associated with the fair value mark-up of rental equipment acquired in certain major acquisitions that was subsequently sold.

The increases in 2023 primarily reflect the impact of the Ahern Rentals acquisition.

The decrease in 2024 primarily reflects the impact of the Ahern Rentals acquisition.

(6) This primarily reflects severance costs and branch closure charges associated with our restructuring programs.

The increases in 2023 reflect charges associated with a restructuring program initiated following the closing of the Ahern Rentals acquisition.

The amounts above primarily reflect charges associated with a restructuring program initiated following the closing of the Ahern Rentals acquisition.

As of December 31, 2024, there were no open restructuring programs.

(7) This reflects write-offs of leasehold improvements and other fixed assets.

(9) Reflects the difference between the net carrying amount and the total purchase price of the redeemed notes.

Earnings Per Share

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Diluted earnings per share $ 38.69 $ 35.28 $ 29.65

Subsequent Events

On January 13, 2025, we entered into an Agreement and Plan of Merger (the “H&E Merger Agreement”) that provides for our acquisition of H&E Equipment Services, Inc.

d/b/a H&E Rentals (“H&E”).

Pursuant to the H&E Merger Agreement, we expect to acquire H&E for $ 92 per share in cash, reflecting a total enterprise value of approximately $ 4.8 billion, including approximately $ 1.4 billion of net debt.

H&E provides its customers with a comprehensive mix of high-quality general rental fleet including aerial work platforms, earthmoving equipment, material handling equipment, and other general and specialty lines of equipment.

The transaction is subject to customary closing conditions, including a minimum tender of at least one share more than 50 percent of then-outstanding H&E common shares and the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

We commenced a tender offer on January 28, 2025 to acquire all of the outstanding shares of H&E common stock for $ 92 per share in cash.

Following completion of the tender offer, we intend to acquire all remaining shares not tendered in the offer through a second-step merger at the same price as in the tender offer.

The transaction is expected to close in the first quarter of 2025.

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS

25 unchanged sentences

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What changed 10-K

Item 8. Financial Statements and Supplementary Data