What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-11-03 compared with 2022-08-04 · 270 added, 160 removed, 596 unchanged (42% of the section changed)

1 unchanged sentence

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Balance Sheets

(in thousands, except share data) June 30, 2022 (unaudited)

Condensed Consolidated Balance Sheets (Unaudited)

(in thousands, except share data) September 30, 2022

December 31, 2021

Cash and cash equivalents $ 15,442 $ 12,699

Trade receivables, net of allowances for credit losses at June 30, 2022 and December 31, 2021 of $ 53,544 and $ 47,629 , respectively

Trade receivables, net of allowances for credit losses of $ 56,127 and $ 46,160 , respectively

439,309 368,856

1 unchanged sentence

Prepaid expenses and other current assets 39,691 36,539

Assets held for sale 1,518 954

Assets held for sale - current 951 32,854

Total current assets 540,266 483,040

5 unchanged sentences

Other non-current assets 8,909 10,797

Assets held for sale - non-current — 285,536

Total long-term assets 5,269,998 5,290,559

7 unchanged sentences

Current portion of long-term debt 13,497 11,968

Liabilities held for sale - current — 23,173

Total current liabilities 614,512 517,645

3 unchanged sentences

Other non-current liabilities 18,182 15,737

Liabilities held for sale - non-current — 44,486

Long-term liabilities 3,514,613 3,259,191

2 unchanged sentences

Preferred Stock:

$ 0.0001 par, 1,000,000 shares authorized and zero shares issued and outstanding at June 30, 2022 and December 31, 2021

$ 0.0001 par, 1,000,000 shares authorized and zero shares issued and outstanding

Common Stock:

$ 0.0001 par, 500,000,000 shares authorized and 216,090,996 and 223,939,527 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively

$ 0.0001 par, 500,000,000 shares authorized and 211,243,820 and 223,939,527 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively

Additional paid-in capital 3,112,076 3,616,902

5 unchanged sentences

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Statements of Operations

Three Months Ended June 30, Six Months Ended June 30,

Condensed Consolidated Statements of Operations (Unaudited)

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands, except share and per share data)

19 unchanged sentences

Restructuring costs — 1,856 ( 86 ) 11,956

Currency (gains) losses, net ( 127 ) 33 11 69

Currency losses, net 236 127 247 196

Other (income) expense, net ( 2,526 ) 1,475 ( 7,642 ) 202

1 unchanged sentence

Interest expense 38,165 29,006 102,362 87,793

Fair value (gain) loss on common stock warrant liabilities — ( 610 ) — 26,597

Fair value loss on common stock warrant liabilities — — — 26,597

Loss on extinguishment of debt — — — 5,999

Income before income tax 98,087 39,199 165,006 54,127

Income tax expense 24,711 18,828 40,459 29,309

Income from continuing operations before income tax 115,947 62,356 267,266 107,619

Income tax expense from continuing operations 30,219 5,243 67,167 32,341

Income from continuing operations 85,728 57,113 200,099 75,278

Discontinued operations:

Income from discontinued operations before income tax 10,802 5,391 24,488 14,255

Income tax expense from discontinued operations 1,986 1,401 5,496 3,612

Gain on sale of discontinued operations 34,049 — 34,049 —

Income from discontinued operations 42,865 3,990 53,041 10,643

Net income $ 128,593 $ 61,103 $ 253,140 $ 85,921

Earnings per share from continuing operations:

Basic $ 0.40 $ 0.25 $ 0.91 $ 0.33

Diluted $ 0.39 $ 0.24 $ 0.89 $ 0.32

Earnings per share from discontinued operations:

Basic $ 0.20 $ 0.02 $ 0.24 $ 0.05

Diluted $ 0.20 $ 0.02 $ 0.24 $ 0.05

Earnings per share:

6 unchanged sentences

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Statements of Comprehensive Income (Loss)

Three Months Ended June 30, Six Months Ended

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Three Months Ended September 30, Nine Months Ended

September 30,

(in thousands)

2 unchanged sentences

Other comprehensive (loss) income:

Foreign currency translation adjustment, net of income tax expense of $ 0 for both the three and six months ended June 30, 2022 and $ 60 and $ 0 for the three and six months ended June 30, 2021, respectively.

Foreign currency translation adjustment, net of income tax expense of $ 0 for both the three and nine months ended September 30, 2022 and $ 0 and $ 60 for the three and nine months ended September 30, 2021, respectively.

( 37,733 ) ( 11,162 ) ( 67,435 ) ( 3,035 )

Net change in derivatives, net of income tax expense of $ 394 and $ 656 for the three months ended June 30, 2022 and 2021, respectively, and $ 1,171 and $ 1,323 for the six months ended June 30, 2022 and 2021, respectively.

Net change in derivatives, net of income tax expense of $ 676 for the three months ended September 30, 2021, and $ 1,171 and $ 1,999 for the nine months ended September 30, 2022 and 2021, respectively.

— 2,206 3,497 6,529

3 unchanged sentences

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Statements of Changes in Equity

Six Months Ended June 30, 2022

Common Stock Additional Paid-in-Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Shareholders' Equity

Condensed Consolidated Statements of Changes in Equity (Unaudited)

Nine Months Ended September 30, 2022

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Shareholders' Equity

(in thousands) Shares Amount

14 unchanged sentences

Balance at June 30, 2022 216,091 22 3,295,747 ( 55,276 ) ( 1,466,543 ) 1,773,950

Six Months Ended June 30, 2021

Common Stock Additional Paid-in-Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Shareholders' Equity

Net income — — — — 128,593 128,593

Other comprehensive loss — — — ( 37,733 ) — ( 37,733 )

Stock-based compensation and issuance of Common Stock from vesting 26 — 6,941 — — 6,941

Repurchase and cancellation of Common Stock ( 5,271 ) — ( 197,457 ) — — ( 197,457 )

Issuance of Common Stock from the exercise of options 398 — 7,363 — — 7,363

Withholding taxes on net share settlement of stock-based compensation — — ( 518 ) — — ( 518 )

Balance at September 30, 2022 211,244 $ 22 $ 3,112,076 $ ( 93,009 ) $ ( 1,337,950 ) $ 1,681,139

Nine Months Ended September 30, 2021

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Shareholders' Equity

(in thousands) Shares Amount

13 unchanged sentences

Balance at June 30, 2021 226,833 23 3,756,563 ( 24,757 ) ( 1,726,416 ) 2,005,413

Net income — — — — 61,103 61,103

Other comprehensive income — — — ( 8,956 ) — ( 8,956 )

Stock-based compensation and issuance of Common Stock from vesting 192 — 7,686 — — 7,686

Repurchase and cancellation of Common Stock and warrants ( 3,752 ) — ( 106,264 ) — — ( 106,264 )

Issuance of Common Stock from the exercise of warrants 393 — 1,517 — — 1,517

Withholding taxes on net share settlement of stock-based compensation — — ( 3,915 ) — — ( 3,915 )

Balance at September 30, 2021 223,666 $ 23 $ 3,655,587 $ ( 33,713 ) $ ( 1,665,313 ) $ 1,956,584

See the accompanying notes which are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

Condensed Consolidated Statements of Cash Flows (Unaudited)

Six Months Ended June 30,

Nine Months Ended September 30,

(in thousands)

4 unchanged sentences

Provision for credit losses 26,018 26,661

Gain on sale of discontinued operations ( 34,049 ) —

Gain on sale of rental equipment and other property, plant and equipment ( 21,698 ) ( 25,327 )

4 unchanged sentences

Deferred income tax expense 56,812 28,140

Unrealized currency gains, net ( 71 ) ( 184 )

Unrealized currency losses, net 171 34

Other 2,976 —

8 unchanged sentences

Investing activities:

Proceeds from sale of discontinued operation 319,543 —

Acquisitions, net of cash acquired ( 208,663 ) ( 56,244 )

8 unchanged sentences

Receipts from borrowings 763,177 551,063

Payment of financing costs ( 8,021 ) —

Repayment of borrowings ( 510,677 ) ( 423,591 )

Payment of financing costs ( 8,130 ) —

Payment of debt extinguishment premium costs — ( 3,705 )

11 unchanged sentences

Capital expenditures accrued or payable $ 40,385 $ 35,819

1 Includes $ 5,948 of payments related to the interest rate swap for the six months ended June 30, 2021.

1 Includes $ 8,986 of payments related to the interest rate swap for the nine months ended September 30, 2021.

See the accompanying notes which are an integral part of these condensed consolidated financial statements.

5 unchanged sentences

(“WillScot Mobile Mini” and, together with its subsidiaries, the “Company”) is a leading business services provider specializing in innovative flexible work space and portable storage solutions in the United States (“US”), Canada, Mexico and the United Kingdom ("UK").

The Company also maintains a fleet of specialty containment products, including liquid and solid containment solutions.

The Company leases, sells, delivers and installs mobile solutions and storage products through an integrated network of branch locations that spans North America and the UK.

5 unchanged sentences

All intercompany balances and transactions are eliminated.

The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year.

The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the full year.

For further information, refer to the consolidated financial statements and notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

2 unchanged sentences

Recently Issued Accounting Standards

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805):

In October 2021, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2021-08, Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("ASU 2021-08").

8 unchanged sentences

Asset Acquisitions

During the second quarter of 2022, the Company acquired certain assets and liabilities of several smaller entities, which consisted primarily of approximately 4,100 storage units and 1,000 modular units for $ 47.1 million in cash.

The accompanying consolidated financial statements include $ 47.1 million of rental equipment as a result of these acquisitions.

D uring the first quarter of 2022, the Company acquired certain assets and liabilities, which consisted primarily of approximately 400 blast resistant modular units.

During the third quarter of 2022, the Company acquired certain assets and liabilities of several smaller entities, which consisted primarily of approximately 7,600 storage units and 3,000 modular units, for $ 104.7 million in cash.

During the first six months of 2022, the Company acquired certain assets and liabilities of several smaller entities, which consisted primarily of approximately 4,100 storage units and 1,400 modular units, for $ 103.9 million in cash.

The accompanying consolidated financial statements include $ 202.3 million of rental equipment as a result of 2022 acquisitions.

During the third quarter of 2021, the Company acquired certain assets and liabilities of several smaller entities, which consisted primarily of approximately 11,000 storage units and 400 modular units for $ 56.3 million in cash.

As a result of these acquisitions, the Company recognized $ 53.0 million of rental equipment and $ 3.0 million of land in its consolidated balance sheet.

Integration Costs

The Company recorded $ 5.2 million and $ 7.6 million in integration costs related to acquisitions and the Merger within selling, general and administrative ("SG&A") expense during the three months ended June 30, 2022 and 2021, respectively, and $ 9.3 million and $ 15.0 million in integration costs related to acquisitions and the Merger during the six months ended June 30, 2022 and 2021, respectively.

The Company recorded $ 3.9 million and $ 8.2 million in integration costs related to acquisitions and the Merger within selling, general and administrative ("SG&A") expense during the three months ended September 30, 2022 and 2021, respectively, and $ 13.2 million and $ 23.2 million in integration costs related to acquisitions and the Merger during the nine months ended September 30, 2022 and 2021, respectively.

NOTE 3 - Divestiture

On August 19, 2022, the Company entered into a stock purchase agreement to sell its Tank and Pump Solutions ("Tank and Pump") business for approximately $ 323 million.

The sale transaction was completed on September 30, 2022.

Exiting the Tank and Pump business represented the Company’s strategic shift to concentrate its operations on its core modular and storage businesses.

In accordance with ASC 360, Property, Plant, and Equipment, the Company ceased recording depreciation and amortization for Tank and Pump rental fleet, property, plant and equipment, and operating lease assets during the third quarter of 2022 when the Tank and Pump business initially qualified as held for sale.

In accordance with ASC 205-20, Presentation of Financial Statements - Discontinued Operations , the Company determined that the criteria for discontinued operations presentation were met during the third quarter of 2022.

As part of the divestiture, the Company entered into a customary transition services agreement with the buyer to assist them in the transition of certain functions, including, but not limited to, information technology, accounting and human resources, for a period of six months with an option for the buyer to extend the agreement for a period of up to twelve months.

There will be no significant continuing involvement with the Tank and Pump business after its disposal.

The following tables present the results of Tank and Pump as reported in income from discontinued operations within the condensed consolidated statements of operations for the three and nine months ended September 30, 2022 and 2021 and the carrying value of the divested business' assets and liabilities as presented within assets and liabilities held for sale on the condensed consolidated balance sheet as of December 31, 2021.

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2022 2021 2022 2021

Leasing and services revenue:

Leasing $ 22,432 $ 20,797 $ 65,572 $ 56,343

Delivery and installation 10,121 7,789 27,665 21,969

Sales revenue:

New units 842 490 2,202 1,908

Rental units 593 429 917 1,123

Total revenues 33,988 29,505 96,356 81,343

Costs of leasing and services:

Leasing 4,913 4,481 13,828 12,628

Delivery and installation 8,634 6,770 23,285 18,317

Costs of sales:

New units 633 324 1,636 1,338

Rental units 238 135 310 429

Depreciation of rental equipment 1,822 3,472 8,145 10,026

Gross profit 17,748 14,323 49,152 38,605

Selling, general and administrative 5,544 6,381 18,045 16,792

Other depreciation and amortization 1,274 2,355 6,103 6,967

Other (expense) income, net ( 16 ) 1 4 7

Operating income 10,946 5,586 25,000 14,839

Interest expense 144 195 512 584

Income from discontinued operations before income tax 10,802 5,391 24,488 14,255

Income tax expense from discontinued operations 1,986 1,401 5,496 3,612

Income from discontinued operations $ 8,816 $ 3,990 $ 18,992 $ 10,643

Other selected data:

Adjusted EBITDA $ 13,048 $ 10,946 $ 37,016 $ 29,870

(in thousands) December 31, 2021

Trade receivables, net of allowances for doubtful accounts of $ 1,469

Inventories 647

Prepaid expenses and other current assets 222

Rental Equipment, net 134,973

Property, plant and equipment, net 29,931

Operating lease assets 11,720

Goodwill 100,107

Intangible assets, net 8,750

Other non-current assets 55

Total assets held for sale $ 317,436

Accounts payable $ 8,001

Accrued expenses 4,603

Accrued employee benefits 2,487

Deferred revenue and customer deposits 27

Deferred tax liabilities 17,095

Operating lease liabilities 11,959

Other non-current liabilities 23,487

Total liabilities held for sale $ 67,659

At December 31, 2021, assets held for sale of $ 1.0 million were not related to the Tank and Pump business and were excluded from the table above.

For the nine months ended September 30, 2022 and 2021, significant operating and investing items related to the Tank and Pump business were as follows:

Nine Months Ended September 30,

(in thousands)

Operating activities of discontinued operations:

Depreciation and amortization $ 14,248 $ 16,993

Investing activities of discontinued operations:

Proceeds from sale of rental equipment $ 917 $ 1,123

Purchase of rental equipment and refurbishments $ ( 19,064 ) $ ( 11,093 )

Proceeds from sale of property, plant and equipment $ — $ 170

Purchase of property, plant and equipment $ ( 403 ) $ ( 1,220 )

The following table presents reconciliations of Income from discontinued operations before income tax to Adjusted EBITDA from discontinued operations for the Tank and Pump business for the three and nine months ended September 30, 2022 and 2021, respectively.

See Note 18 for further information regarding Adjusted EBITDA.

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2022 2021 2022 2021

Income from discontinued operations before income tax $ 10,802 $ 5,391 $ 24,488 $ 14,255

Interest expense 144 195 512 584

Depreciation and amortization 3,096 5,828 14,248 16,993

Restructuring costs, lease impairment expense and other related charges — — — 2

Integration costs — 5 — 5

Stock compensation expense ( 221 ) 102 18 175

Other ( 773 ) ( 575 ) ( 2,250 ) ( 2,144 )

Adjusted EBITDA from discontinued operations $ 13,048 $ 10,946 $ 37,016 $ 29,870

NOTE 4 - Revenue

1 unchanged sentence

Geographic Areas

The Company had total revenue in the following geographic areas for the three and six months ended June 30, 2022 and 2021 as follows:

The Company had total revenue in the following geographic areas for the three and nine months ended September 30, 2022 and 2021 as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2022 2021 2022 2021

6 unchanged sentences

Equipment leasing is the Company's core business and the primary driver of the Company's revenue and cash flows.

This includes modular space, portable storage and tank and pump units along with value-added products and services ("VAPS"), which include furniture, steps, ramps, basic appliances, internet connectivity devices, security products, shelving systems and other items used by customers in connection with the Company's products.

This includes modular space and portable storage units along with value-added products and services ("VAPS"), which include furniture, steps, ramps, basic appliances, internet connectivity devices, security products, shelving systems and other items used by customers in connection with the Company's products.

Leasing is complemented by new unit sales and sales of rental units.

In connection with its leasing and sales activities, the Company provides services including delivery and installation, maintenance and ad hoc services and removal services at the end of lease transactions.

The Company’s revenue by major product and service line for the three and six months ended June 30, 2022 and 2021 was as follows:

The Company’s revenue by major product and service line for the three and nine months ended September 30, 2022 and 2021 was as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2022 2021 2022 2021

1 unchanged sentence

Portable storage leasing revenue 103,503 66,184 269,964 179,645

Tank and pump leasing revenue 20,706 17,109 39,937 32,869

VAPS and third party leasing revenues (a)

8 unchanged sentences

Total revenues $ 604,173 $ 461,047 $ 1,632,339 $ 1,295,634

(a) Includes $ 6.8 million and $ 7.8 million of service revenue for the three months ended June 30, 2022 and 2021, respectively, and $ 14.3 million and $ 14.0 million of service revenue for the six months ended June 30, 2022 and 2021, respectively.

(a) Includes $ 8.8 million and $ 7.2 million of service revenue for the three months ended September 30, 2022 and 2021, respectively, and $ 23.1 million and $ 21.2 million of service revenue for the nine months ended September 30, 2022 and 2021, respectively.

(b) Includes primarily damage billings, delinquent payment charges, and other processing fees.

Leasing and Services Revenue

The majority of r evenue ( 73 % and 74 % for the three and six months ended June 30, 2022, respectively, and 73 % for both the three and six months ended June 30, 2021) was generated by rental income subject to the guidance of ASU 2018-11, Leases (Topic 842) ("ASC 842").

The majority of revenue ( 73 % and 74 % for the three and nine months ended September 30, 2022, respectively, and 73 % for both the three and nine months ended September 30, 2021) was generated by rental income subject to the guidance of ASU 2018-11, Leases (Topic 842) ("ASC 842").

The remaining revenue was generated by performance obligations in contracts with customers for services or sale of units subject to the guidance in ASC 606.

12 unchanged sentences

Activity in the allowance for credit losses was as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2022 2021 2022 2021

8 unchanged sentences

For contracts that continue beyond their initial contractual lease term, revenue continues to be deferred until the services are performed.

During the three months ended June 30, 2022, deferred revenue relating to services billed in advance of $ 20.7 million was recognized as revenue.

As of June 30, 2022 and December 31, 2021, the Company had approximately $ 95.7 million and $ 79.4 million, respectively, of deferred revenue related to these services.

The Company does not have material contract assets and it did not recognize any material impairments of contract assets.

The Company's uncompleted contracts with customers have unsatisfied (or partially satisfied) performance obligations.

During the three months ended September 30, 2022, deferred revenue relating to services billed in advance of $ 24.5 million was recognized as revenue.

As of September 30, 2022 and December 31, 2021, the Company had approximately $ 107.9 million and $ 79.4 million , respectively, of deferred revenue related to these services.

The Company does not have material contract assets, and the Company's uncompleted contracts with customers have unsatisfied (or partially satisfied) performance obligations.

For the future services revenues that are expected to be recognized within twelve months, the Company has elected to utilize the optional disclosure exemption made available regarding transaction price allocated to unsatisfied (or partially unsatisfied) performance obligations.

5 unchanged sentences

NOTE 5 - Leases

As of June 30, 2022, the undiscounted future lease payments for operating and finance lease liabilities were as follows:

As of September 30, 2022, the undiscounted future lease payments for operating and finance lease liabilities were as follows:

(in thousands) Operating Finance

9 unchanged sentences

Finance lease liabilities are included within long-term debt and current portion of long-term debt on the condensed consolidated balance sheets.

The Company’s lease activity during the six months ended June 30, 2022 and 2021 was as follows:

(in thousands) Six Months Ended June 30,

The Company’s lease activity during the nine months ended September 30, 2022 and 2021 was as follows:

(in thousands) Nine Months Ended September 30,

Financial Statement Line 2022 2021

5 unchanged sentences

Fixed lease expense

Cost of leasing and services $ 1,574 $ 2,131

Costs of leasing and services $ 2,242 $ 3,019

Selling, general and administrative 46,580 42,494

1 unchanged sentence

Short-term lease expense

Cost of leasing and services 17,056 11,575

Costs of leasing and services 24,122 17,751

Selling, general and administrative 1,466 615

Variable lease expense

Cost of leasing and services 2,822 3,373

Costs of leasing and services 3,989 5,442

Selling, general and administrative 5,951 5,332

2 unchanged sentences

Lease impairment expense and other related charges relate to closed locations that are no longer used in operations as a result of consolidation activities within the Company.

During the six months ended June 30, 2022, the Company recorded $ 0.3 million in lease impairment expense and other related charges which is comprised of closed location rent expense.

During the six months ended June 30, 2021, the Company recorded $ 1.7 million in lease impairment expense and other related charges which is comprised of $ 1.5 million in closed location rent expense and $ 0.2 million loss on lease exit and impairment charges.

Supplemental cash flow information related to leases for the six months ended June 30, 2022 and 2021 was as follows:

(in thousands) Six Months Ended June 30,

During the nine months ended September 30, 2022, the Company recorded $ 0.3 million in lease impairment expense and other related charges which is comprised of closed location rent expense.

During the nine months ended September 30, 2021, the Company recorded $ 2.3 million in lease impairment expense and other related charges which is comprised of $ 2.0 million in closed location rent expense and $ 0.3 million loss on lease exit and impairment charges.

Supplemental cash flow information related to leases for the nine months ended September 30, 2022 and 2021 was as follows:

(in thousands) Nine Months Ended September 30,

Supplemental Cash Flow Information 2022 2021

5 unchanged sentences

Assets obtained in exchange for finance leases $ 22,414 $ 17,184

Weighted-average remaining operating lease terms and the weighted average discount rates as of June 30, 2022 and December 31, 2021 were as follows:

Lease Terms and Discount Rates June 30, 2022 December 31, 2021

Weighted-average remaining operating lease terms and the weighted average discount rates as of September 30, 2022 and December 31, 2021 were as follows:

Lease Terms and Discount Rates September 30, 2022 December 31, 2021

Weighted-average remaining lease term - operating leases 5.9 years 6.1 years

5 unchanged sentences

(in thousands)

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Raw materials $ 38,720 $ 26,340

4 unchanged sentences

(in thousands)

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Modular space units $ 3,254,022 $ 3,005,195

Portable storage units 898,275 758,619

Tank and pump products 167,854 156,112

Value added products 198,494 168,358

4 unchanged sentences

Changes in the carrying amount of goodwill were as follows:

(in thousands) NA Modular NA Storage UK Storage Tank and Pump Total

(in thousands) NA Modular NA Storage UK Storage Total

Balance at December 31, 2020 $ 235,828 $ 726,529 $ 65,600 $ 1,027,957

3 unchanged sentences

Effects of movements in foreign exchange rates ( 2,766 ) — ( 11,351 ) ( 14,117 )

Balance at June 30, 2022 $ 520,695 $ 492,318 $ 58,605 $ 100,107 $ 1,171,725

The Company had no goodwill impairment during the six months ended June 30, 2022 or the year ended December 31, 2021.

Balance at September 30, 2022 $ 518,283 $ 492,552 $ 53,747 $ 1,064,582

The Company had no goodwill impairment during the nine months ended September 30, 2022 or the year ended December 31, 2021.

NOTE 9 - Intangibles

Intangible assets other than goodwill at the respective balance sheet dates consisted of the following:

June 30, 2022

September 30, 2022

(in thousands) Weighted average remaining life (in years) Gross carrying amount Accumulated amortization Net book value

17 unchanged sentences

Total intangible assets other than goodwill $ 489,500 $ ( 37,572 ) $ 451,928

Amortization expense related to intangible assets was $ 6.6 million and $ 6.8 million for the three months ended June 30, 2022 and 2021, respectively, and $ 13.2 million and $ 13.8 million for the six months ended June 30, 2022 and 2021, respectively.

Based on the carrying value at June 30, 2022, future amortization of intangible assets is expected to be as follows for the years ended December 31:

Amortization expense related to intangible assets was $ 6.0 million and $ 6.6 million for the three months ended September 30, 2022 and 2021, respectively, and $ 19.2 million and $ 20.0 million for the nine months ended September 30, 2022 and 2021, respectively.

Based on the carrying value at September 30, 2022, future amortization of intangible assets is expected to be as follows for the years ended December 31:

(in thousands)

4 unchanged sentences

The carrying value of debt outstanding at the respective balance sheet dates consisted of the following:

(in thousands, except rates) Interest rate Year of maturity June 30, 2022 December 31, 2021

(in thousands, except rates) Interest rate Year of maturity September 30, 2022 December 31, 2021

2025 Secured Notes 6.125 % 2025 $ 519,778 $ 518,117

6 unchanged sentences

Total long-term debt $ 2,935,800 $ 2,676,985

(a) As of December 31, 2021, the Company h ad no outst anding principal borrowings on the multicurrency revolving credit facility and $ 6.2 million of related debt issuance costs.

No related debt issuance costs were recorded as a direct offset against the principal borrowings on the Multicurrency Facility, and the $ 6.2 million in excess of principal was included in other non-current assets on the condensed consolidated balance sheet as of December 31, 2021.

(a) As of both September 30, 2022 and December 31, 2021, the Company had no outstanding principal borrowings on the multicurrency revolving credit facility and $ 4.4 million and $ 6.2 million, respectively, of related debt issuance costs.

No related debt issuance costs were recorded as a direct offset against the principal borrowings on the Multicurrency Facility, and the $ 4.4 million and $ 6.2 million in excess of principal was included in other non-current assets on the condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021, respectively.

Asset Backed Lending Facility

11 unchanged sentences

The ABL Facility requires the payment of an annual commitment fee on the unused available borrowings of 0.20 % annually.

At June 30, 2022, the weighted average interest rate for borrowings under the ABL Facility was 3.13 %.

At September 30, 2022, the weighted average interest rate for borrowings under the ABL Facility was 4.46 %.

Borrowing availability under the US Facility and the Multicurrency Facility is equal to the lesser of (i) the aggregate Revolver Commitments and (ii) the Line Cap.

At June 30, 2022, the Company had $ 2.0 billion outstanding principal under the ABL Facility, the Line Cap was $ 3.0 billion, and the Company had $ 1.0 billion of available borrowing capacity under the ABL Facility, including $ 724.6 million under the US Facility and $ 309.5 million under the Multicurrency Facility.

At June 30, 2022, borrowing capacity under the ABL Facility allowed for up to $ 204.9 million of letters of credit and up to $ 220.0 million of swingline loans.

The Company had issued $ 15.1 million of standby letters of credit under the ABL Facility at June 30, 2022.

At June 30, 2022, letters of credit and bank guarantees carried fees of 1.625 % annually .

Debt issuance costs of $ 40.2 million were included in the carrying value of the ABL Facility at June 30, 2022.

At September 30, 2022, the Company had $ 1.9 billion outstanding principal under the ABL Facility, the Line Cap was $ 3.0 billion, and the Company had $ 1.1 billion of available borrowing capacity under the ABL Facility, including $ 821.3 million under the US Facility and $ 292.1 million under the Multicurrency Facility.

At September 30, 2022, borrowing capacity under the ABL Facility allowed for up to $ 204.9 million of letters of credit and up to $ 220.0 million of swingline loans.

The Company had issued $ 15.1 million of standby letters of credit under the ABL Facility at September 30, 2022.

At September 30, 2022, letters of credit and bank guarantees carried fees of 1.625 % annually.

Debt issuance costs of $ 33.6 million were included in the carrying value of the ABL Facility at September 30, 2022.

Finance Leases

The Company maintains finance leases primarily related to transportation equipment.

At June 30, 2022 and December 31, 2021, obligations under finance leases for certain real property and transportation related equipment were $ 95.1 million and $ 89.1 million, respectively.

At September 30, 2022 and December 31, 2021, obligations under finance leases for transportation related equipment were $ 72.8 million and $ 65.6 million, respectively.

Refer to Note 5 for further information.

The Company is in compliance with all debt covenants and restrictions for the aforementioned debt instruments as of June 30, 2022.

The Company is in compliance with all debt covenants and restrictions for the aforementioned debt instruments as of September 30, 2022.

NOTE 11 – Equity

In connection with the stock compensation vesting events and stock option exercises described in Note 14, and the warrant exercises described in Note 11, the Company issued 1,437,420 shares of Common Stock during the six months ended June 30, 2022.

In connection with the stock compensation vesting events and stock option exercises described in Note 15, and the warrant exercises described in Note 12, the Company issued 1,860,778 shares of Common Stock during the nine months ended September 30, 2022.

Stock Repurchase Program

A share repurchase program authorizes the Company to repurchase up to $ 1.0 billion of its outstanding shares of Common Stock and equivalents.

The stock repurchase program does not obligate the Company to purchase any particular number of shares, and the timing and exact amount of any repurchases will depend on various factors, including market pricing and conditions, business, legal, accounting, and other considerations.

During the six months ended June 30, 2022, the Company repurchased 9,304,626 shares of Common Stock and stock equivalents for $ 326.9 million.

As of June 30, 2022, $ 629.8 million of the approved repurchase amount remained available.

In July 2022, the Company's Board of Directors approved an increase to the share repurchase program that authorizes the Company to repurchase up to $ 1.0 billion of its outstanding shares of Common Stock and equivalents.

During the nine months ended September 30, 2022, t he Company repurchased 14,575,160 shares of Common Stock and stock equivalents for $ 524.4 million.

As of September 30, 2022, $ 863.3 million of the approved repurchase amount remained available.

Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive income (loss) ("AOCI"), net of tax, for the six months ended June 30, 2022 and 2021 were as follows:

Six Months Ended June 30, 2022

The changes in accumulated other comprehensive income (loss) ("AOCI"), net of tax, for the nine months ended September 30, 2022 and 2021 were as follows:

Nine Months Ended September 30, 2022

(in thousands) Foreign currency translation Unrealized losses on hedging activities Total

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Balance at June 30, 2022 ( 55,276 ) — ( 55,276 )

Six Months Ended June 30, 2021

Other comprehensive loss ( 37,733 ) — ( 37,733 )

Balance at September 30, 2022 $ ( 93,009 ) $ — $ ( 93,009 )

Nine Months Ended September 30, 2021

(in thousands) Foreign currency translation Unrealized losses on hedging activities Total

6 unchanged sentences

Balance at June 30, 2021 ( 16,567 ) ( 8,190 ) ( 24,757 )

For the six months ended June 30, 2022 and 2021 , $ 4.5 million and $ 5.9 million , was reclassified from AOCI into interest expense in the condensed consolidated statements of operations related to the interest rate swap discussed in Note 15.

Associated with these reclassifications, t he Company recorded tax expense of $ 0.4 million and $ 0.7 million for the three months ended June 30, 2022 and 2021, respectively, and $ 1.1 million and $ 1.3 million for the six months ended June 30, 2022 and 2021, respectively.

Other comprehensive income before reclassifications ( 11,162 ) ( 830 ) ( 11,992 )

Reclassifications from AOCI to income — 3,036 3,036

Balance at September 30, 2021 $ ( 27,729 ) $ ( 5,984 ) $ ( 33,713 )

For the nine months ended September 30, 2022 and 2021, $ 4.5 million and $ 9.0 million, respectively, was reclassified from AOCI into interest expense in the condensed consolidated statements of operations related to the interest rate swap discussed in Note 16.

Associated with these reclassifications, the Company recorded tax expense of $ 0.7 million for the three months ended September 30, 2021, and $ 1.1 million and $ 2.0 million for the nine months ended September 30, 2022 and 2021, respectively.

The interest rate swap terminated on May 29, 2022.

NOTE 12 – Warrants

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2018 Warrants

In connection with the Modular Space Holdings ("ModSpace") acquisition in 2018, WillScot issued warrants to purchase approximately 10.0 million shares of Common Stock (the "2018 Warrants") to former shareholders of ModSpace.

In connection with the Modular Space Holdings acquisition in 2018, WillScot issued warrants to purchase approximately 10.0 million shares of Common Stock (the "2018 Warrants") to former shareholders.

Each 2018 Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $ 15.50 per share, subject to adjustment.

The 2018 Warrants expire on November 29, 2022.

During the six months ended June 30, 2022, 33,965 of the 2018 Warrants were repurchased for $ 0.6 million and cancelled .

In addition, during the six months ended June 30, 2022, 1,037,379 of the 2018 Warrants were exercised on a cashless basis, resulting in the issuance of 631,863 shares of common stock.

At June 30, 2022, 3,006,829 of the 2018 Warrants were outstanding.

During the nine months ended September 30, 2022, 33,965 of the 2018 Warrants were repurchased for $ 0.6 million and cancelled.

In addition, during the nine months ended September 30, 2022, 1,037,379 of the 2018 Warrants were exercised on a cashless basis, resulting in the issuance of 631,863 shares of common stock.

At September 30, 2022, 3,006,829 of the 2018 Warrants were outstanding.

The Company accounted for its warrants in the following ways:

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NOTE 13 – Income Taxes

The Company recorded $ 24.7 million and $ 40.5 million of income tax expense for the three and six months ended June 30, 2022, respectively, and $ 18.8 million and $ 29.3 million of income tax expense for the three and six months ended June 30, 2021, respectively.

The Company’s effective tax rate for the three and six months ended June 30, 2022 was 25.2 % and 24.5 %, respectively.

The Company's effective tax rate for the three and six months ended June 30, 2021 was 48.0 % and 54.2 %, respectively.

The effective tax rate for the three and six months ended June 30, 2022 differed from the US federal statutory rate of 21% primarily due to state and provincial taxes offset by a discrete tax benefit related to employee stock vesting.

The effective tax rate for the three and six months ended June 30, 2021 differed from the US statutory rate of 21% primarily due to the permanent add-backs related to changes in the estimated fair values of the Company's common stock warrant liabilities and the impact of the UK statutory rate increase.

The Company recorded $ 30.2 million and $ 67.2 million of income tax expense for the three and nine months ended September 30, 2022, respectively, and $ 5.2 million and $ 32.4 million of income tax expense for the three and nine months ended September 30, 2021, respectively.

The Company’s effective tax rate for the three and nine months ended September 30, 2022 was 26.1 % and 25.1 %, respectively.

The Company's effective tax rate for the three and nine months ended September 30, 2021 was 8.4 % and 30.1 %, respectively.

The effective tax rate for the three and nine months ended September 30, 2022 differed from the US federal statutory rate of 21% primarily due to state and provincial taxes offset by a discrete tax benefit related to employee stock vesting.

The effective tax rate for the three months ended September 30, 2021 differs from the U.S federal statutory rate of 21% primarily due to the reversal of approximately of $ 12.8 million in reserves for uncertain tax positions ("UTP") due to the expiration of relevant statutes of limitation.

The effective tax rate for the nine months ended September 30, 2021 differs from the US federal statutory rate of 21% primarily due to the permanent add-backs related to fair value accounting on the Company's warrants and executive compensation with an offset related to the discrete tax benefit from the reversal of reserves for UTP.

NOTE 14 - Fair Value Measures

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The Company has assessed that the fair value of cash and cash equivalents, trade receivables, trade payables, and other current liabilities approximate their carrying amounts.

Based on the borrowing rates currently available for bank loans with similar terms and average maturities, the fair value of finance leases at June 30, 2022 approximate their respective book values.

Based on the borrowing rates currently available for bank loans with similar terms and average maturities, the fair values of finance leases at September 30, 2022 approximate their respective book values.

The following table shows the carrying amounts and fair values of financial liabilities which are disclosed, but not measured, at fair value, including their levels in the fair values hierarchy:

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Carrying Amount

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Total $ 2,876,449 $ — $ 2,846,252 $ — $ 2,623,390 $ — $ 2,711,970 $ —

As of June 30, 2022, the carrying values of the ABL Facility, the 2025 Secured Notes, and the 2028 Secured Notes include d $ 40.2 million, $ 7.3 million, and $ 7.0 million, respectively, of unamortized debt issuance costs, which were presented as a direct reduction of the corresponding liability.

As of December 31, 2021, the carrying value of the ABL Facility, the 2025 Secured Notes, and the 2028 Secured Notes included $ 31.7 million, $ 8.4 million, and $ 7.5 million, respectively, of unamortized debt issuance costs, which were presented as a direct reduction of the corresponding liability.

As of September 30, 2022, the carrying values of the ABL Facility, the 2025 Secured Notes, and the 2028 Secured Notes included $ 33.6 million, $ 6.7 million, and $ 6.8 million, respectively, of unamortized debt issuance costs, which were presented as a direct reduction of the corresponding liability.

As of December 31, 2021, the carrying value of the ABL Facility,

the 2025 Secured Notes, and the 2028 Secured Notes included $ 31.7 million, $ 8.4 million, and $ 7.5 million, respectively, of unamortized debt issuance costs, which were presented as a direct reduction of the corresponding liability.

The carrying value of the ABL Facility, excluding debt issuance costs, approximates fair value as the interest rates are variable and reflective of current market rates.

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Level 3 Disclosures

When the 2015 Private Warrants were classified as liabilities, the Company utilized a Black Scholes option-pricing model to value the warrants at each reporting period and transaction date, with changes in fair value recognized in the statements of operations.

During the periods the 2015 Private Warrants were classified as liabilities, the Company utilized a Black Scholes option-pricing model to value the warrants at each reporting period and transaction date, with changes in fair value recognized in the statements of operations.

The estimated fair value of the common stock warrant liability was determined using Level 3 inputs.

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The dividend rate was based on the historical rate, which the Company anticipated to remain at zero.

The following table presents changes in Level 3 liabilities measured at fair value for the three months ended June 30, 2021:

(in thousands) 2015 Private Warrants

Balance - March 31, 2021 $ 99,781

Exercise or conversion ( 78,495 )

Measurement adjustment ( 1,571 )

Repurchases ( 19,715 )

Balance- June 30, 2021 $ —

The following table presents changes in Level 3 liabilities measured at fair value for the six months ended June 30, 2021:

The following table presents changes in Level 3 liabilities measured at fair value for the nine months ended September 30, 2021:

(in thousands) 2015 Private Warrants

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Repurchases ( 24,395 )

Balance- June 30, 2021 $ —

Balance- September 30, 2021 $ —

NOTE 15 - Stock-Based Compensation

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Vested ( 36,176 ) $ 29.30 ( 57,448 ) $ 11.75

Balance June 30, 35,244 $ 37.17 40,442 $ 29.30

Compensation expense for RSAs recognized in SG&A expense on the condensed consolidated statements of operations was $ 0.3 million and $ 0.1 million for the three months ended June 30, 2022 and 2021, respectively.

Compensation expense for RSAs recognized in SG&A expense on the condensed consolidated statements of operations was $ 0.6 million and $ 0.3 million for the six months ended June 30, 2022 and 2021, respectively.

At June 30, 2022, there was $ 1.2 million of unrecognized compensation cost related to RSAs that is expected to be recognized over the remaining weighted average vesting period of 0.9 years.

Balance September 30, 35,244 $ 37.17 36,176 $ 29.30

Compensation expense for RSAs recognized in SG&A expense on the condensed consolidated statements of operations was $ 0.3 million for both the three months ended September 30, 2022 and 2021.

Compensation expense for RSAs recognized in SG&A expense on the condensed consolidated statements of operations was $ 0.9 million and $ 0.6 million for the nine months ended September 30, 2022 and 2021, respectively.

At September 30, 2022, there was $ 0.9 million of unrecognized compensation cost related to RSAs that is expected to be recognized over the remaining weighted average vesting period of 0.7 years.

Time-Based RSUs

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Vested ( 478,906 ) $ 16.42 ( 667,151 ) $ 13.98

Balance June 30, 885,807 $ 25.93 1,318,526 $ 17.61

Compensation expense for Time-Based RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 2.5 million and $ 2.4 million for the three months ended June 30, 2022 and 2021, respectively.

Compensation expense for RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 4.7 million and $ 4.3 million for the six months ended June 30, 2022 and 2021, respectively.

At June 30, 2022, unrecognized compensation cost related to Time-Based RSUs totaled $ 18.9 million and is expected to be recognized over the remaining weighted average vesting period of 2.7 years.

Balance September 30, 801,508 $ 26.27 1,009,295 $ 18.59

Compensation expense for Time-Based RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 1.7 million and $ 3.2 million for the three months ended September 30, 2022 and 2021, respectively.

Compensation expense for RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 6.4 million and $ 7.5 million for the nine months ended September 30, 2022 and 2021, respectively.

At September 30, 2022, unrecognized compensation cost related to Time-Based RSUs totaled $ 15.9 million and is expected to be recognized over the remaining weighted average vesting period of 2.4 years.

Performance-Based RSUs

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Vested ( 313,152 ) $ 16.45 — $ —

Balance June 30, 1,937,609 $ 33.84 971,292 $ 24.56

Compensation expense for Performance-Based RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 6.5 million and $ 2.0 million for the three months ended June 30, 2022 and 2021, respectively.

Compensation expense for Performance-Based RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 10.3 million and $ 3.1 million for the six months ended June 30, 2022 and 2021, respectively .

At June 30, 2022, unrecognized compensation cost related to Performance-Based RSUs totaled $ 47.5 million and is expected to be recognized over the remaining vesting period of 1.9 years.

Balance September 30, 1,906,643 $ 33.72 1,550,956 $ 26.29

Compensation expense for Performance-Based RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 4.9 million and $ 2.7 million for the three months ended September 30, 2022 and 2021, respectively.

Compensation expense for Performance-Based RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $ 15.2 million and $ 5.8 million for the nine months ended September 30, 2022 and 2021, respectively.

At September 30, 2022, unrecognized compensation cost related to Performance-Based RSUs totaled $ 41.4 million and is expected to be recognized over the remaining vesting period of 2.3 years.

Certain Performance-Based RSUs cliff vest based on achievement of the relative total stockholder return ("TSR") of the Company's Common Stock as compared to the TSR of the constituents in an index at the grant date over the performance period of three years.

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Exercised — $ — ( 635,318 ) $ 17.02

Balance June 30, 2022 534,188 $ 13.60 1,289,824 $ 14.68

Fully vested and exercisable options, June 30, 2022 534,188 $ 13.60 1,289,824 $ 14.68

Balance September 30, 2022 534,188 $ 13.60 892,325 $ 12.97

Fully vested and exercisable options, September 30, 2022 534,188 $ 13.60 892,325 $ 12.97

WillScot Options Weighted-Average Exercise Price per Share Converted Mobile Mini Options Weighted-Average Exercise Price per Share

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Exercised — $ — ( 484,986 ) $ 15.26

Balance June 30, 2021 534,188 $ 13.60 1,652,083 $ 14.57

Fully vested and exercisable options, June 30, 2021 400,641 $ 13.60 1,652,083 $ 14.57

Balance September 30, 2021 534,188 $ 13.60 1,540,229 $ 14.65

Fully vested and exercisable options, September 30, 2021 400,641 $ 13.60 1,540,229 $ 14.65

WillScot Options

Compensation expense for stock option awards, recognized in SG&A expense on the condensed consolidated statements of operations, was $ 0.2 million for the three months ended June 30, 2021.

Compensation expense for stock option awards, recognized in SG&A expense on the condensed consolidated statements of operations, was $ 0.2 million and $ 0.4 million for the six months ended June 30, 2022 and 2021.

Compensation expense for stock option awards, recognized in SG&A expense on the condensed consolidated statements of operations, was $ 0.2 million for the three months ended September 30, 2021.

Compensation expense for stock option awards, recognized in SG&A expense on the condensed consolidated statements of operations, was $ 0.2 million and $ 0.6 million for the nine months ended September 30, 2022 and 2021, respectively.

NOTE 16 - Derivatives

On November 6, 2018, the Company entered into an interest rate swap agreement (the “Swap Agreement”) with a financial counterparty that effectively converted $ 400.0 million in aggregate notional amount of variable-rate debt under the Company’s ABL facility into fixed-rate debt.

In 2018, the Company entered into an interest rate swap agreement (the “Swap Agreement”) with a financial counterparty that effectively converted $ 400.0 million in aggregate notional amount of variable-rate debt under the Company’s ABL facility into fixed-rate debt.

The Swap Agreement terminated on May 29, 2022.

4 unchanged sentences

(in thousands) Balance Sheet Account December 31, 2021

Cash Flow Hedges:

Interest rate swap Accrued expenses $ 5,259

The fair value of the interest rate swap was based on dealer quotes of market forward rates, a Level 2 input on the fair value hierarchy, and reflected the amount that the Company would receive or pay for contracts involving the same attributes and maturity dates.

The following table discloses the impact of the interest rate swap, excluding the impact of income taxes, on other comprehensive income (“OCI”), AOCI and the Company’s combined consolidated statements of operations for the six months ended June 30,:

(in thousands) 2022 2021

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The Company assesses these matters on a case-by-case basis as they arise and establishes reserves as required.

As of June 30, 2022, with respect to these outstanding matters, the Company believes that the amount or range of reasonably possible loss will not, either individually or in the aggregate, have a material adverse effect on the consolidated financial position, results of operations, or cash flows.

As of September 30, 2022, with respect to these outstanding matters, the Company believes that the amount or range of reasonably possible loss will not, either individually or in the aggregate, have a material adverse effect on the consolidated financial position, results of operations, or cash flows of the Company.

However, the outcome of such matters is inherently unpredictable and subject to significant uncertainties.

NOTE 18 - Segment Reporting

The Company operates in four reportable segments as follows:

North America Modular Solutions ("NA Modular"), North America Storage Solutions ("NA Storage"), United Kingdom Storage Solutions ("UK Storage") and Tank and Pump Solutions ("Tank and Pump").

The Company operates in three reportable segments as follows:

North America Modular Solutions ("NA Modular"), North America Storage Solutions ("NA Storage") and United Kingdom Storage Solutions ("UK Storage").

Total assets for each reportable segment are not available because the Company utilizes a centralized approach to working capital management.

1 unchanged sentence

The Company defines EBITDA as net income (loss) plus interest (income) expense, income tax (benefit) expense, depreciation and amortization.

The Company reflects the further adjustments to EBITDA (“Adjusted EBITDA”) to exclude certain non-cash items and the effect of what the Company considers transactions or events not related to its core and ongoing business operations.

In addition, the Chief Operating Decision Maker ("CODM") evaluates business segment performance utilizing Adjusted EBITDA as shown in the reconciliation of the Company’s consolidated net income to Adjusted EBITDA below.

The Company reflects further adjustments to EBITDA (“Adjusted EBITDA”) to exclude certain non-cash items and the effect of what the Company considers transactions or events not related to its core and ongoing business operations.

Management believes that evaluating segment performance excluding such items is meaningful because it provides insight with respect to the intrinsic and ongoing operating results of the Company.

The Company also regularly evaluates gross profit by segment to assist in the assessment of its operational performance.

The Company considers Adjusted EBITDA to be the more important metric because it more fully captures the business performance of the segments, inclusive of indirect costs.

The Company considers Adjusted EBITDA to be an important metric because it reflects the business performance of the segments, inclusive of indirect costs.

Reportable Segments

The following tables set forth certain information regarding each of the Company’s reportable segments fo r the three and six months ended June 30, 2022 and 2021, respectively.

Three Months Ended June 30, 2022

(in thousands) NA Modular NA Storage UK Storage Tank and Pump Unallocated Costs Total

The following tables set forth certain information regarding each of the Company’s reportable segments fo r the three and nine months ended September 30, 2022 and 2021, respectively.

Three Months Ended September 30, 2022

(in thousands) NA Modular NA Storage UK Storage Unallocated Costs 1

Leasing and services revenue:

20 unchanged sentences

Purchases of rental equipment and refurbishments $ 81,052 $ 41,246 $ 4,605 $ — $ 126,903

Three Months Ended June 30, 2021

(in thousands) NA Modular NA Storage UK Storage Tank and Pump Unallocated Costs Total

1 Unallocated SG&A expense includes non-cash charges for stock compensation plans and costs to integrate acquired companies.

Three Months Ended September 30, 2021

(in thousands) NA Modular NA Storage UK Storage Unallocated Costs Total

Leasing and services revenue:

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Purchases of rental equipment and refurbishments $ 31,789 $ 11,920 $ 11,649 $ — $ 55,358

Six Months Ended June 30, 2022

(in thousands) NA Modular NA Storage UK Storage Tank and Pump Unallocated Costs Total

Nine Months Ended September 30, 2022

(in thousands) NA Modular NA Storage UK Storage Unallocated Costs Total

Leasing and services revenue:

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Purchases of rental equipment and refurbishments $ 221,111 $ 95,699 $ 21,824 $ — $ 338,634

Six Months Ended June 30, 2021

(in thousands) NA Modular NA Storage UK Storage Tank and Pump Unallocated Costs Total

Nine Months Ended September 30, 2021

(in thousands) NA Modular NA Storage UK Storage Unallocated Costs Total

Leasing and services revenue:

17 unchanged sentences

Purchases of rental equipment and refurbishments $ 120,288 $ 24,165 $ 22,645 $ — $ 167,098

The following table presents a reconciliation of the Company’s Net income to Adjusted EBITDA for the three and six months ended June 30, 2022 and 2021, respectively:

Three Months Ended June 30, Six Months Ended June 30,

The following table presents reconciliations of the Company’s Income from continuing operations to Adjusted EBITDA for the three and nine months ended September 30, 2022 and 2021, respectively:

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands) 2022 2021 2022 2021

Net income $ 73,376 $ 20,371 $ 124,547 $ 24,818

Income tax expense 24,711 18,828 40,459 29,309

Income from continuing operations $ 85,728 $ 57,113 $ 200,099 $ 75,278

Income tax expense from continuing operations 30,219 5,243 67,167 32,341

Loss on extinguishment of debt — — — 5,999

Fair value (gain) loss on common stock warrant liabilities — ( 610 ) — 26,597

Fair value loss on common stock warrant liabilities — — — 26,597

Interest expense 38,165 29,006 102,362 87,793

Depreciation and amortization 86,225 69,449 243,123 216,820

Currency (gains) losses, net ( 127 ) 33 11 69

Currency losses, net 236 127 247 196

Restructuring costs, lease impairment expense and other related charges — 2,457 168 14,284

4 unchanged sentences

Adjusted EBITDA $ 251,339 $ 179,203 $ 652,529 $ 499,359

Included in restructuring costs for the three and six months ended June 30, 2021 was expense of approximately $ 4.3 million and $ 5.8 million, respectively, recognized as a result of the modification of certain equity awards associated with the Transition, Separation and Release Agreement entered into on February 25, 2021 with the Company's former President and Chief Operating Officer.

Included in restructuring costs for the three and nine months ended September 30, 2021 was expense of approximately $ 1.4 million and $ 7.2 million, respectively, recognized as a result of the modification of certain equity awards associated with the Transition, Separation and Release Agreement entered into on February 25, 2021 with the Company's former President and Chief Operating Officer.

NOTE 19 - Earnings Per Share

The following table reconciles the weighted average shares outstanding for the basic calculation to the weighted average shares outstanding for the diluted calculation:

Three Months Ended Six Months Ended

June 30 June 30

Three Months Ended Nine Months Ended

September 30, September 30,

(in thousands) 2022 2021 2022 2021

Net income - basic $ 73,376 $ 20,371 $ 124,547 $ 24,818

Fair value gain on common stock warrant liabilities — ( 610 ) — —

Net income - dilutive $ 73,376 $ 19,761 $ 124,547 $ 24,818

Income from continuing operations $ 85,728 $ 57,113 $ 200,099 $ 75,278

Income from discontinued operations 42,865 3,990 53,041 10,643

Net income $ 128,593 $ 61,103 $ 253,140 $ 85,921

Weighted average Common Shares outstanding - basic 213,637 225,998 219,312 227,558

6 unchanged sentences

Weighted average Common Shares outstanding - dilutive 217,928 231,868 223,933 234,085

For the three and six months ended June 30, 2022, 1,252,968 and 904,379 shares of Performance-Based RSUs, respectively, were excluded from the computation of diluted EPS because their effect would have been anti-dilutive.

For the three and six months ended June 30, 2021, no warrants, shares or options were excluded from the computation of diluted EPS.

For the three and nine months ended September 30, 2022, 555,790 and 788,183 shares of Performance-Based RSUs, respectively, were excluded from the computation of diluted EPS because their effect would have been anti-dilutive.

For the three and nine months ended September 30, 2021, no warrants, shares or options were excluded from the computation of diluted EPS.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements