Essex Rental Reports Business Decline for Second Quarter 2016

August 24, 2016 - Essex Rental Corp. released second quarter financials yesterday, attributing a decline in business results to continued softness in the oil and gas markets. Within the next 30 days, the company reports it expects to have clarity on a possible divestiture of Essex Crane, after which it would no longer be part of ongoing operations.

 

Dollar utilization for rough terrain cranes decreased to 17.1% for the three-month period ended June 30, 2016 compared to 20.8% for the same period ended June 30, 2015. Dollar utilization for tower cranes increased to 19.7% for the three-month period, compared to 17.8% for the same period in 2015.

 

The equipment rental segment’s gross profit decreased by approximately $500,000 to $2.1 million during this period, compared to $2.6 million for the same period in 2015. The parts & service segment’s gross profit decreased by approximately $200,000 to $1.0 million, compared to $1.2 million for 2015.

 

“The continued softness in the oil and gas end markets has negatively impacted the industry and has resulted in a decline in business results,” said Nick Matthews, president and CEO. Assuming Essex Crane will no longer be part of the company in the future, the focus will be on maintaining strong levels of utilization on our tower-crane fleet, increasing utilization on our other assets, and improving our parts and service segment, he explained.

 

“We now have concrete evidence supporting the market value of the Coast Crane subsidiary. As we work through refinancing that subsidiary, we are dedicated to reducing leverage and are excited by the opportunities to unlock the equity value of this company to increase shareholder value through growth and improving market conditions,” he added.