Custom Truck One Source(CTOS) - 2025 Q2 - Quarterly Results

Report Overview CTOS Second-Quarter Highlights CTOS reported strong Q2 2025 results with significant revenue and Adjusted EBITDA growth, improved rental fleet utilization, and record OEC, reaffirming 2025 guidance - Achieved strong year-over-year revenue growth of 21% and adjusted EBITDA growth of 17%, driven by growth in every segment[3] - Rental fleet average utilization reached just under 78%, a significant improvement from the prior year and in line with expectations[3] - Ended the quarter with total OEC of $1.56 billion, the highest in company history, expected to support future growth[3] - TES sales increased over 22% year-over-year, marking the second-highest quarter of sales ever, driven by robust demand for vocational vehicles[3] - Signed orders in the quarter were up 30% year-over-year, positioning the company well for expected segment growth[3] Summary Actual Consolidated Financial Results CTOS reported a 20.9% increase in total revenue and 16.7% Adjusted EBITDA growth for Q2 2025, despite an increased net loss Consolidated Financial Highlights (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 ($000s) | Q2 2024 ($000s) | Change ($000s) | % Change | Source Chunk | | :----------------- | :-------------- | :-------------- | :------------- | :------- | :----------- | | Rental revenue | 120,814 | 102,997 | 17,817 | 17.3% | 4, 6 | | Equipment sales | 356,112 | 285,633 | 70,479 | 24.7% | 4, 6 | | Parts sales & services | 34,557 | 34,383 | 174 | 0.5% | 4, 6 | | Total revenue | 511,483 | 423,013 | 88,470 | 20.9% | 4, 6 | | Gross Profit | 102,542 | 89,267 | 13,275 | 14.9% | 4, 6 | | Adjusted Gross Profit | 156,549 | 133,852 | 22,697 | 17.0% | 4, 6 | | Net Income (Loss) | (28,380) | (24,478) | (3,902) | 15.9% | 4, 6 | | Adjusted EBITDA | 93,428 | 80,056 | 13,372 | 16.7% | 4, 6 | Summary Financial Results by Segment (Introduction) CTOS reports financial results across Equipment Rental Solutions (ERS), Truck and Equipment Sales (TES), and Aftermarket Parts and Services (APS) segments - ERS encompasses the core rental business, including sales of used rental equipment[5] - TES covers specialized truck and equipment production and new equipment sales[5] - APS includes sales and rentals of parts, tools, and supplies, as well as aftermarket repair services[5] Segment Performance Equipment Rental Solutions (ERS) ERS segment showed strong Q2 2025 growth, with total revenue up 23.2% year-over-year, driven by higher rental revenue and equipment sales ERS Segment Financials (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 ($000s) | Q2 2024 ($000s) | Change ($000s) | % Change | Source Chunk | | :----------------- | :-------------- | :-------------- | :------------- | :------- | :----------- | | Rental revenue | 117,728 | 100,699 | 17,029 | 16.9% | 7 | | Equipment sales | 52,744 | 37,712 | 15,032 | 39.9% | 7 | | Total revenue | 170,472 | 138,411 | 32,061 | 23.2% | 7 | | Gross profit | 46,445 | 39,757 | 6,688 | 16.8% | 7 | | Adjusted Gross Profit | 99,748 | 83,338 | 16,410 | 19.7% | 7 | Truck and Equipment Sales (TES) The TES segment experienced robust Q2 2025 equipment sales growth of 22.0% year-over-year, driven by strong demand for vocational vehicles TES Segment Financials (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 ($000s) | Q2 2024 ($000s) | Change ($000s) | % Change | Source Chunk | | :-------------- | :-------------- | :-------------- | :------------- | :------- | :----------- | | Equipment sales | 303,368 | 247,921 | 55,447 | 22.4% | 8 | | Gross profit | 47,092 | 42,395 | 4,697 | 11.1% | 8 | Aftermarket Parts and Services (APS) The APS segment showed modest Q2 2025 revenue growth of 2.6%, driven by increased rental revenue and improved gross profit margin APS Segment Financials (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 ($000s) | Q2 2024 ($000s) | Change ($000s) | % Change | Source Chunk | | :---------------------- | :-------------- | :-------------- | :------------- | :------- | :----------- | | Rental revenue | 3,086 | 2,298 | 788 | 34.3% | 9 | | Parts and services revenue | 34,557 | 34,383 | 174 | 0.5% | 9 | | Total revenue | 37,643 | 36,681 | 962 | 2.6% | 9 | | Gross profit | 9,005 | 7,115 | 1,890 | 26.6% | 9 | Operating Metrics Summary Combined Operating Metrics CTOS reported increased Ending OEC, Average OEC on rent, and improved fleet utilization for Q2 2025, despite a decrease in sales order backlog Combined Operating Metrics (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 ($000s) | Q2 2024 ($000s) | Change ($000s) | % Change | Source Chunk | | :----------------- | :-------------- | :-------------- | :------------- | :------- | :----------- | | Ending OEC | 1,560,704 | 1,457,955 | 102,749 | 7.0% | 10 | | Average OEC on rent | 1,207,231 | 1,044,683 | 162,548 | 15.6% | 10 | | Fleet utilization | 77.6% | 71.7% | 5.9 pp | 8.2% | 10 | | OEC on rent yield | 38.6% | 40.0% | (1.4 pp) | (3.5%) | 10 | | Sales order backlog | 334,805 | 478,244 | (143,439) | (30.0%) | 10 | Definitions of Operating Metrics This section defines key CTOS operating metrics: Ending OEC, Average OEC on rent, Fleet utilization, OEC on rent yield (ORY), and Sales order backlog - Ending OEC is the original equipment cost of units at the end of the measurement period[10] - Average OEC on rent is the weighted-average OEC on rent during the stated period[11] - Fleet utilization is the total number of days rental equipment was rented divided by total days available, weighted by OEC[11] - OEC on rent yield (ORY) measures return realized by the rental fleet, calculated as annualized rental revenue (excluding freight/ancillary fees) divided by Average OEC on rent[12] - Sales order backlog represents purchase orders for customized and stock equipment, but is not an accurate measure of future net sales[13] Management Discussion & Analysis [Consolidated Performance Commentary](index=5&type=section&id=Consolidated%20Performance