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What changed in WillScot Holdings Corp's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of WillScot Holdings Corp's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+527 added−490 removedSource: 10-K (2024-02-20) vs 10-K (2023-02-22)

Top changes in WillScot Holdings Corp's 2023 10-K

527 paragraphs added · 490 removed · 341 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

134 edited+86 added−60 removed64 unchanged
Biggest changeUse of the Safety Save application is just one manner we use to manage safety leadership at all levels. Further, WillScot Mobile Mini uses and is expanding a vehicle/truck-based camera system used to improve driving behaviors. Lastly, the Company maintains a robust safety assessment program that drives increased focus to our Health and Safety core value, by providing increased visibility.
Biggest changeLastly, the Company maintains a robust safety assessment program that includes an annual commitment to environmental, health and safety by all employees that drives increased focus to our Health and Safety core value by providing increased visibility. Our goal is to help each team member succeed and enjoy a safe working experience.
We encourage collaboration and support the diverse voices and thoughts of our employees and communities. • Driven to Excellence: We measure success through our results and achievement of our goals.
We encourage collaboration and support the diverse voices and thoughts of our employees and communities. • Driven to Excellence: We measure success through our results and the achievement of our goals.
We are subject to certain environmental, health, and safety laws and regulations in countries, states, provinces, and localities in which we operate. Our health and safety programs are designed around global standards with appropriate variations addressing the multiple jurisdictions, regulations, hazards, and unique working environments where we operate.
We are subject to certain environmental, health, and safety laws and regulations in the countries, states, provinces, and localities in which we operate. Our health and safety programs are designed around global standards with appropriate variations addressing the multiple jurisdictions, regulations, hazards, and unique working environments where we operate.
See “Risk Factors—We may be unable to successfully acquire and integrate new operations, which could cause our business to suffer." 10 Our Asset Base Provides Highly Attractive Asset-Level Returns with Long Useful Lives The combination of long, predictable lease durations, long asset lives, and attractive unit economics underpins the compelling cash generation capability in our business model.
See “Risk Factors—We may be unable to successfully acquire and integrate new operations, which could cause our business to suffer." Our Asset Base Provides Highly Attractive Asset-Level Returns with Long Useful Lives The combination of long, predictable lease durations, long asset lives, and attractive unit economics underpins the compelling cash generation capability in our business model.
The sale of units from our rental equipment has historically been both a profitable and cost-effective method to finance the replenishment and upgrade of our lease fleet, as well as to generate free cash flow during periods of lower rental demand and utilization. Our 7 sales business may include modifying or customizing units to meet customer requirements.
The sale of units from our rental equipment has historically been both a profitable and cost-effective method to finance the replenishment and upgrade of our lease fleet, as well as to generate free cash flow during periods of lower rental demand and utilization. Our sales business may include modifying or customizing units to meet customer requirements.
In connection with our leasing and sales activities, we provide services including delivery and installation, maintenance and ad hoc services, and removal services at the end of lease transactions. Panelized and Stackable Offices. O ur Flex TM p anelized and stackable offices are the next generation of modular space technology and offer maximum flexibility and design configurations.
In connection with our leasing and sales activities, we provide services including delivery and installation, maintenance and ad hoc services, and removal services at the end of lease transactions. 5 Panelized and Stackable Offices. O ur FLEX TM p anelized and stackable offices are the next generation of modular space technology and offer maximum flexibility and design configurations.
We maintain our steel containers on a regular basis by removing rust, painting them with rust inhibiting paint, plug‑welding holes, and occasionally replacing the wooden floor or a rusted steel panel. Repainting the outside of storage units is the most common maintenance item.
We maintain our steel containers on a regular basis by removing rust, painting them with rust inhibiting paint, plug-welding holes, and occasionally replacing the wooden floor or a rusted steel panel. Repainting the outside 6 of storage units is the most common maintenance item.
We believe we have the broadest network of operating branches in North America, as well as a scalable corporate center and information technology systems, which position us to continue to acquire and integrate other companies 13 while expanding the products and services available and offered to acquired customers.
We believe we have the broadest network of operating branches in North America, as well as a scalable corporate center and information technology systems, which position us to continue to acquire and integrate other companies while expanding the products and services available and offered to acquired customers.
We believe our extensive scale results in significant operational benefits, such as optimization of fleet yield and utilization, efficient capital allocation, superior service capabilities, and the ability to offer consistent "Ready to Work" solutions across all of our branch locations.
We believe our extensive scale results in significant operational benefits, such as optimization of fleet yield and utilization, efficient capital allocation, superior service capabilities, and the ability to offer consistent "Ready to Work" turnkey solutions across all of our branch locations.
Shift from traditional fixed, on-site built space to modular space solutions: driven by several advantages as compared with fixed, on-site built space, including: • Quick to install: the pre-fabrication of modular space units allows them to be put in place rapidly, providing potential long-term solutions to needs that may have materialized quickly. • Flexibility: flexible assembly design allows modular space units to be built to suit a customer’s needs while offering customers the ability to adjust their space as their needs change. • Cost effectiveness: modular space units provide a cost-effective solution for temporary and permanent space requirements and allow customers to improve returns on capital in their core business. • Quality: the pre-fabrication of modular space units is based on a repeatable process in a controlled environment, resulting in more consistent quality. • Mobility: modular space units can easily be disassembled, transported to a new location and re-assembled. • Environmentally friendly: relocatable buildings promote the reuse of facilities, on an as-needed basis, by the occupants, and leave zero residual footprint once removed.
Shift from traditional fixed, on-site built space to modular space solutions: driven by several advantages as compared with fixed, on-site built space, including: • Quick to install: the pre-fabrication of modular space units allows them to be put in place rapidly, providing potential long-term solutions to needs that may have materialized quickly. • Flexibility: flexible assembly design allows modular space units to be built to suit a customer’s needs while offering customers the ability to adjust their space as their needs change. 12 • Cost effectiveness: modular space units provide a cost-effective solution for temporary and permanent space requirements and allow customers to improve returns on capital in their core business. • Quality: the pre-fabrication of modular space units is based on a repeatable process in a controlled environment, resulting in more consistent quality. • Mobility: modular space units can easily be disassembled, transported to a new location and re-assembled. • Environmentally friendly: relocatable buildings promote the reuse of facilities, on an as-needed basis, by the occupants, and leave no residual footprint once removed.
For decades, we have committed ourselves to circular economic practices to reuse as many of our assets as possible. Our Board of Directors, at the direction of its Nominating and Corporate Governance Committee, is actively involved in the development of our ESG strategy and approach.
For decades, we have committed ourselves to circular economic practices to reuse as many of our assets as possible. Our Board of Directors, at the direction of our Nominating and Corporate Governance Committee, is actively involved in the development of our ESG strategy and approach.
A properly maintained container is essentially in the same condition as when it was initially acquired or remanufactured. The remanufacturing process begins with the purchase of used ISO containers from leasing companies, shipping lines, and brokers.
A properly maintained container is essentially in the same condition as when it was initially acquired or remanufactured. The remanufacturing process begins with the purchase of used ISO-certified containers from leasing companies, shipping lines, and brokers.
Construction customers typically reflect higher demand during months with more temperate weather, while demand from large retailers is stronger from September through December, when more space is needed to store holiday inventories.
Construction customers typically reflect higher demand during months with more temperate weather, while demand from large retailers is stronger from September through December, when 7 more space is needed to store holiday inventories.
Section Modulars and Redi-Plex. Section modulars are two or more units combined into one structure. Redi-Plex complexes offer advanced versatility for large, open floor plans or custom layouts with private offices.
Section modulars are two or more units combined into one structure. Redi-Plex complexes offer advanced versatility for large, open floor plans or custom layouts with private offices.
Our Approach to Environmental, Social and Governance ("ESG") We are committed to upholding high standards when it comes to our environmental, social and governance responsibilities, as well as the safety of our employees and our business partners.
Environmental, Social and Governance ("ESG") We are committed to upholding high standards when it comes to our environmental, social and governance responsibilities, as well as the safety of our employees and our business partners.
Storage containers can be equipped with our patented Tri‑Cam Locking System®, which features a waist‑level opening lever and interlocking bars to provide easy access for the owner without sacrificing security. We also offer ContainerGuardLock®, an optional security device, which features a hidden six‑pin tumbler system and is made from drill‑resistant hardened steel.
Storage containers can be equipped with our patented Tri‑Cam Locking System®, which features a waist‑level opening lever and interlocking bars to provide easy access for the customer without sacrificing security. We also offer ContainerGuardLock®, an optional security device, which features a hidden six‑pin tumbler system and is made from drill‑resistant hardened steel.
Our sales force is optimally positioned to improve efficiency by leveraging our management information systems and using real-time information to monitor and optimize conversion of customer opportunities across our core segments. During 2022, we made significant investments in our customer relationship management ("CRM") software, moving from our legacy WillScot and Mobile Mini CRM instances into one new, consolidated CRM platform.
Our sales force is optimally positioned to improve efficiency by leveraging our management information systems and using real-time information to monitor and optimize conversion of customer opportunities across our core segments. During 2022 and 2023, we made significant investments in our CRM software platform, moving from our legacy WillScot and Mobile Mini CRM instances into one new, consolidated CRM platform.
Our logistics and service infrastructure is designed to meet or exceed our customers’ expectations by reacting quickly, efficiently, and with consistent service levels. As a result, we have established strong relationships with a diverse customer base, ranging from large multinational companies to local sole proprietors. We served over 85,000 unique customers in 2022.
Our logistics and service infrastructure is designed to meet or exceed our customers’ expectations by reacting quickly, efficiently, and with consistent service levels. As a result, we have established strong relationships with a diverse customer base, ranging from large multinational companies to local sole proprietors. We served over 85,000 unique customers in 2023.
The turnover of our fleet, with average lease durations of nearly three years, creates natural and reoccurring opportunities to capture incremental price increases. As the market leader in our industry, we offer the broadest fleet portfolio, the most differentiated turnkey VAPS, and the most consistent service capabilities across the largest branch network to help our customers be 'Ready to Work'.
The turnover of our fleet, with average lease durations of approximately three years, creates natural and reoccurring opportunities to capture incremental price increases. As the market leader in our industry, we offer the broadest fleet portfolio, the most differentiated turnkey VAPS, and the most consistent service capabilities across the largest branch network to help our customers be 'Ready to Work'.
On a stand‑alone basis, retail and wholesale trade customers comprised approximately 13% of fiscal year 2022 rental revenue. Energy and Natural Resources Our products are leased to companies involved in electricity generation and transmission, utilities, up- mid- and down-stream oil and gas, mining exploration and extraction, and other related sectors.
On a stand‑alone basis, retail and wholesale trade customers comprised approximately 13% of fiscal year 2023 rental revenue. Energy and Natural Resources Our products are leased to companies involved in electricity generation and transmission, utilities, up- mid- and down-stream oil and gas, mining exploration and extraction, and other related sectors.
Our Business and Growth Strategies We intend to maintain a leading market position and increase our revenue and profitability by pursuing the following strategies, all of which we have demonstrated in our historical operating performance: Expand Penetration of Value-Added Products and Services ("VAPS") VAPS have been the most prominent growth driver in our modular business for almost a decade.
Our Business and Growth Strategies We intend to maintain a leading market position and increase our revenue and profitability by pursuing the following strategies, all of which we have demonstrated in our historical operating performance: Expand Penetration of Value-Added Products and Services ("VAPS") VAPS have been a prominent growth driver in our business for almost a decade.
Rental contracts provide that the customer is responsible for the cost of delivery and pickup and specify that the customer is liable for any damage done to the unit beyond ordinary wear and tear. Customers may purchase a damage waiver to avoid damage liability in certain circumstances, which provides an additional source of reoccurring revenue.
Rental contracts provide that the customer is responsible for the cost of delivery and pickup and specify that the customer is liable for any damage done to the unit beyond ordinary wear and tear. Customers may purchase a damage waiver to avoid damage liability in certain circumstances, which provides an additional source of recurring revenue.
Management does not believe that the effect of such compliance will be material to our business or financial condition. 19
Management does not believe that the effect of such compliance will be material to our business or financial condition.
Our Business Generates Predictable Reoccurring Cash Flow Due to Our Long-Term Leases and Flexible Capex Requirements Our reoccurring revenue, combined with our flexible capex requirements and efficient use of working capital has allowed us to generate substantial free cash flow, both in periods of growth and economic downturn.
Our Business Generates Predictable Recurring Cash Flow Due to Our Long-Term Leases and Flexible Capex Requirements Our recurring revenue, combined with our flexible capex requirements and efficient use of working capital has allowed us to generate substantial Free Cash Flow, both in periods of growth and economic downturn.
Classroom units are generally double-wide units or Flex panelized units adapted specifically for use by school systems or universities. Classroom units usually feature teaching aids, air conditioning, heating and filtration units, windows and, if requested, toilet facilities. Ground Level Offices.
Classroom units are generally double-wide units or FLEX panelized units adapted specifically for use by school systems or universities. Classroom units usually feature teaching aids, air conditioning, heating and filtration units, windows and, if requested, restroom facilities. Ground Level Offices.
However, given that our customers value flexibility, they consistently extend their leases or renew on a month-to-month basis such that the average effective duration of our Modular segment lease portfolio was over 35 months.
However, given that our customers value flexibility, they consistently extend their leases or renew on a month-to-month basis such that the average effective duration of our Modular segment lease portfolio was over 36 months.
Enhance Market Penetration Between Segments The combination of WillScot and Mobile Mini through the Merger created a leading business services provider specializing in innovative flexible work space and portable storage solutions. At the time of the Merger, we recognized that there was 80% end-market overlap and 40% customer overlap, a clear strategic opportunity for our complementary product lines.
Enhance Market Penetration Between Segments The combination of WillScot and Mobile Mini through the Merger created a leading business services provider specializing in innovative flexible workspace and portable storage solutions. At the time of the Merger, we recognized that there was 80% end-market overlap and 40% customer overlap, a clear strategic opportunity for our complementary product lines.
Our modular units are typically made of steel and aluminum frames, as well as traditional building materials, and range from standalone portable units as small as 24 square feet to large complex units that can be coupled together or stacked to create versatile work spaces in excess of 10,000 square feet.
Our modular units are typically made of steel and aluminum frames, as well as traditional building materials, and range from standalone portable units as small as 24 square feet to large complex units that can be coupled together or stacked to create versatile workspaces in excess of 10,000 square feet.
Remanufacturing typically involves cleaning, removing rust and dents, repairing floors and sidewalls, painting, and adding company logos or signs, and may include further customization by adding our proprietary easy opening door system and our patented Tri‑Cam Locking System®. Modification typically involves splitting some containers into differing lengths.
Remanufacturing typically involves cleaning, removing rust and dents, repairing floors and sidewalls, painting, and adding company logos or signs, and may include further customization by adding our proprietary easy opening door system and our patented Tri‑Cam Locking System®. Modification typically involves splitting some containers into differing lengths. Cold Storage Containers and Trailers.
Retail customers usually return these rented units in December and early in the following year, but also undertake ongoing rolling store renovations which present consistent reoccurring demand throughout the year.
Retail customers usually return these rented units in December and early in the following year, but also undertake ongoing rolling store renovations which present consistent recurring demand throughout the year.
This flexibility insulates utilization from exposure to industry‑specific shocks, provided there are other needs and applications for these products within a reasonable distance. The following chart illustrates the breakdown of our customers and revenue by end market as of December 31, 2022.
This flexibility insulates utilization from exposure to industry‑specific shocks, provided there are other needs and applications for these products within a reasonable distance. 10 The following chart illustrates the breakdown of our customers and revenue by end market as of December 31, 2023.
Core to our operating model is the ability to redeploy standardized assets across end markets, as we did in the last few years to service emerging demand in the healthcare and government sectors related to COVID‑19, as well as expanded space requirements related to social distancing.
Core to our operating model is the ability to redeploy standardized assets across end markets, as we did to service emerging demand in the healthcare and government sectors related to COVID‑19, as well as expanded space requirements related to social distancing.
Commercial and Industrial Customers in this category use our products as their primary office or retail space, to expand their existing commercial workspace, to increase their storage capabilities, or as temporary space for festivals, sporting, and other events.
Commercial and Industrial Customers in this category use our products as their primary office or retail space, to expand their existing commercial workspace, to increase their storage capabilities, or as temporary space for festivals, trade shows, sporting, and 8 other events.
Typically, in the second half of the product's life, we complete a refurbishment, which can extend the asset life by another 10 years, allowing many of our units to be in service for close to 30 years.
Typically, in the second half of the product’s life, we complete a full refurbishment, which can extend the asset life by another 10 years, allowing many of our modular units to be in service for 30 years.
Our customers operate in a diversified set of end markets, including commercial and industrial, construction, education, energy and natural resources, government, and other end markets. For the year ended December 31, 2022, the top 50 customers for WillScot Mobile Mini accounted for approximately 14% of total revenues.
Our customers operate in a diversified set of end markets, including commercial and industrial, construction, education, energy and natural resources, government, and other end markets. For the year ended December 31, 2023, the top 50 customers for WillScot Mobile Mini accounted for approximately 13% of total revenues.
To optimize the use of fleet assets across our branch network, we centrally manage fleet rebalancing across our end markets. This allows us to serve 15 distinct end markets in which no customer accounted for more than 3% of revenue for the year ended December 31, 2022.
To optimize the use of fleet assets across our branch network, we centrally manage fleet rebalancing across our end markets. This allows us to serve 15 distinct end markets in which no customer accounted for more than 2% of revenue for the year ended December 31, 2023.
Modular space units are non-residential structures designed to meet federal, provincial, state, and local building codes and, in most cases, are designed to be relocatable. Modular space units are constructed offsite, utilizing manufacturing techniques to prefabricate single or multi-story whole building solutions in deliverable modular sections.
Modular Space Market The modular space market is fragmented. Modular space units are non-residential structures designed to meet federal, provincial, state, and local building codes and, in most cases, are designed to be relocatable. Modular space units are constructed offsite, utilizing manufacturing techniques to prefabricate single or multi-story whole building solutions in deliverable modular sections.
These priorities are the driving force that shapes who we are and what we do. Safety extends beyond our branches and yards and includes travel and activities at the customer sites. WillScot Mobile Mini fosters an environment in which our employees feel empowered and choose to make the safest and best decisions possible.
Our health and safety priorities are a driving force that shape who we are and what we do. Safety extends beyond our branches and yards and includes travel and activities at the customer sites. WillScot Mobile Mini fosters an environment in which our employees feel empowered and choose to make the safest and best decisions possible.
ITEM 1. Business Unless the context otherwise requires, “we,” “us,” “our” and the “Company” refers to WillScot Mobile Mini Holdings Corp. ("WillScot Mobile Mini") and its subsidiaries. Our Company Headquartered in Phoenix, Arizona, we are a leading business services provider specializing in innovative flexible work space and portable storage solutions.
ITEM 1. Business Unless the context otherwise requires, “we,” “us,” “our” and the “Company” refers to WillScot Mobile Mini Holdings Corp. ("WillScot Mobile Mini") and its subsidiaries. Our Company Headquartered in Phoenix, Arizona, we are a leading business services provider specializing in innovative and flexible turnkey temporary space solutions.
We have the widest and most flexible offering of temporary relocatable commercial spaces, a diverse customer base with over 85,000 customers across different end markets, and a geographic footprint of approximately 240 branch locations and additional drop lots. Our unrivaled network serves the largest North American metropolitan areas with local teams who are experts in their respective markets.
We have a wide and flexible offering of temporary relocatable commercial spaces, a diverse customer base with over 85,000 customers across different end markets, and a geographic footprint of approximately 250 branch locations and additional drop lots. Our network serves the largest North American metropolitan areas with local teams who are experts in their respective markets.
These transactions have included small local storage portfolios, regional operators with mixed modular and storage fleets, and larger transformational acquisitions such as Mobile Mini in 2020.
These transactions have included small local storage portfolios, regional operators with mixed modular and storage fleets, and larger transformational acquisitions such as Modular Space Corporation in 2018 and Mobile Mini in 2020.
Standard portable storage containers are made from weather‑resistant corrugated steel and are available in lengths ranging from 5 to 48 feet, widths of either 8 feet or 10 feet, and a variety of configuration options. Doors can be placed at the front, front and back, or the sides of containers. Other options include partitions, shelving and lighting.
Standard portable storage containers are made from weather‑resistant corrugated steel and are available in lengths ranging from 5 to 48 feet, widths of either 8 or 10 feet, and a variety of configuration options. Doors can be placed at the front, front and back, or the sides of containers.
We offer a range of other specialty products that vary across regions and provide flexibility to serve demands for local markets. Examples include workforce accommodation units with dining facilities used to house workers, often in remote locations, blast-resistant units, and toilet facilities to complement office and classroom units. Portable Storage Solutions Portable Storage Containers.
We offer a range of other specialty products that vary across regions and provide flexibility to serve demands for local markets. Examples include workforce accommodation units with dining facilities used to house workers, often in remote locations, and stand-alone restroom facilities to complement office and classroom units. Portable Storage Solutions Portable Storage Containers.
WillScot Mobile Mini is the holding company for the Williams Scotsman and Mobile Mini families of companies, which resulted from the combination of WillScot Corporation and Mobile Mini, Inc. through a merger that occurred on July 1, 2020 (the "Merger"). On September 30, 2022, the Company completed the sale of its former Tank and Pump Solutions ("Tank and Pump") segment.
WillScot Mobile Mini is the holding company for the Williams Scotsman and Mobile Mini families of companies, which resulted from the merger of WillScot Corporation ("WillScot") and Mobile Mini, Inc. ("Mobile Mini") on July 1, 2020 (the "Merger"). On September 30, 2022, the Company completed the sale of its former Tank and Pump Solutions ("Tank and Pump") segment.
We view this as an additional powerful value creation lever, and we are committed to deploying this capital as productively as possible in the interests of our shareholders. Human Capital Management As of December 31, 2022, we employed approximately 4,500 people in North America (the US, Canada and Mexico), the majority of whom are full time.
We view this as an additional powerful value creation lever, and we are committed to deploying this capital as productively as possible in the interests of our shareholders. Human Capital Management As of December 31, 2023, we employed approximately 5,000 people in North America (the US, Canada and Mexico), the majority of whom are full time.
Our construction and infrastructure customer base is characterized by a wide variety of contractors that are associated with original construction as well as capital improvements in the private, institutional, and municipal arenas. Units are used as offices, break rooms, accommodations, security offices, and other applications.
Our construction and infrastructure customer base is characterized by a wide variety of contractors that are associated with original construction as well as capital improvements in the private, institutional, and municipal arenas. Units are used as offices, lunch and break rooms, accommodations, restroom facilities, material and equipment storage facilities, security offices, and other applications.
To optimize the use of fleet assets across our branch network, we centrally manage fleet rebalancing across our end markets. This allows us to serve 15 distinct end markets in which no one customer accounted for more than 3% of revenues for the year ended December 31, 2022.
To optimize the use of fleet assets across our branch network, we centrally manage fleet rebalancing across our end markets. This allows us to serve 15 distinct end markets in which no single customer accounted for more than 2% of revenues for the year ended December 31, 2023.
The long term nature of our leases, with average lease durations of approximately 32 months as of December 31, 2022, produces strong operating income and predictable cash flow.
The long term nature of our leases, with average lease durations of approximately 37 months as of December 31, 2023, produces strong operating income and predictable cash flow.
Competitive Strengths We believe that the following competitive strengths have been instrumental to our success and position us for future growth: North American Leader in Turnkey Modular Space and Portable Storage Solutions We are an industry-leading business services provider specializing in innovative flexible work space and portable storage solutions.
Competitive Strengths We believe that the following competitive strengths have been instrumental to our success and position us for future growth: North American Leader in Turnkey Temporary Space Solutions We are an industry-leading business services provider specializing in innovative turnkey temporary space solutions.
On average, steel storage containers on rent for the year ended December 31, 2022 in our Storage segment, excluding seasonal portable storage units, had been in place for over 31 months, and the steel ground level offices on rent for the year ended December 31, 2022 had been in place for approximately 18 months.
On average, steel storage containers on rent for the year ended December 31, 2023 in our Storage segment, excluding seasonal portable storage units, had been in place for over 38 months, and the steel ground level offices on rent for the year ended December 31, 2023 had been in place for approximately 22 months.
We believe this growth opportunity could be substantially larger if we successfully penetrate more of our modular space, ground level office and portable storage units and continue to expand our VAPS offerings through new product introductions. Optimize Rate Across Fleet We continue to advance multiple pricing strategies across our fleet to drive revenue growth.
We believe this growth opportunity could be substantially larger if we successfully penetrate more of our modular space and portable storage units and continue to expand our VAPS offerings through new product introductions. Optimize Rate Across Fleet We continue to advance multiple pricing strategies, customer segmentation, and contract standardization across our fleet to drive revenue growth.
These turnkey solutions offer customers flexible, low‑cost, capital efficient, and timely solutions to meet their space needs on an outsourced basis. VAPS have been a substantial source of revenue growth in our Modular segment over the last decade.
These turnkey solutions offer customers flexible, low‑cost, capital efficient, and timely solutions to meet their space needs on an outsourced basis. VAPS have been a substantial source of revenue growth for us over the last decade.
We exercise control and discretion over capex, due to the longevity and relative simplicity of our products, the ability to invest only where needed and when needed to meet demand, and the ability to sell excess fleet during lower utilization periods.
Due to the longevity and relative simplicity of our products, we exercise control and discretion over capex, investing only where needed and when needed to meet demand, and selling excess fleet during lower utilization periods.
Education Rapid shifts in populations within regions, as well as recent needs to expand square footage per student in in-person education settings, often necessitate quick and cost-effective expansion of education facilities, across the spectrum of elementary and secondary schools and universities and colleges.
Education Rapid shifts in populations within regions, as well as expanding square footage per student requirements in in-person education settings, often necessitate quick and cost-effective expansion of education facilities, across the spectrum of elementary and secondary schools and universities and colleges.
These units provide a modern, innovative design, smaller footprint, ground level access, and interchangeable panels, including all glass panels that allow customers to configure 5 the space to their precise requirements. These units have the ability to expand upwards up to three stories and outwards, which provides maximum versatility. Single-Wide Modular Space Units.
These units provide a modern, innovative design, smaller footprint, ground level access, and interchangeable panels, including all glass panels that allow customers to configure the space to their precise requirements. These units can expand upwards up to three stories and outwards, which provides maximum versatility. Single-Wide Modular Space Units. Single-wide modular space units include mobile offices and sales offices.
We track several market leading indicators to predict demand, including those related to our two largest end markets, the commercial and industrial segment and the construction segment, which accounted for approximately 47% and 41% of our revenues, respectively, for the year ended December 31, 2022.
We track several market leading indicators to predict demand, including those related to our two largest end markets, the commercial and industrial segment and the construction segment, each of which accounted for approximately 43% and 42% of our revenues, respectively, for the year ended December 31, 2023.
We continuously improve ourselves and our products and services in pursuit of maximizing long-term stockholder value. • Trustworthy & Reliable: We hold ourselves accountable to do the right thing. • Devoted to Our Customers: We anticipate the growing needs of our customers and strive to exceed their expectations and make it easy to do business with us. • Community Focused: We actively engage in the communities we serve and deliver sustainable solutions.
We continuously improve ourselves, our products and services in pursuit of shareholder value. • Trustworthy & Reliable: We hold ourselves accountable to do the right thing, especially when nobody's looking. • Devoted to Our Customers: We anticipate the growing needs of our customers, exceed their expectations and make it easy to do business with us. • Community Focused: We actively engage in the communities we serve and deliver sustainable solutions.
Approximately 103,000 of our modular space units, or 67%, and 176,000 of our portable storage units, or 84%, were on rent as of December 31, 2022. Product Sales We complement our core leasing business by selling both new and used units, allowing us to leverage our scale, achieve purchasing benefits, and redeploy capital employed in our lease fleet.
Approximately 99,000 of our modular space units, or 63%, and 151,000 of our portable storage units, or 71%, were on rent as of December 31, 2023. Product Sales We complement our core leasing business by selling both new and used units, allowing us to leverage our scale, achieve purchasing benefits, and redeploy capital employed in our lease fleet.
For the year ended December 31, 2022, our top 10 customers accounted for approximately 7% of revenues, and our top 50 customers accounted for approximately 14% of revenues, reflecting low customer concentration and significant project diversification within our portfolio.
For the year ended December 31, 2023, our top 10 customers accounted for approximately 6% of revenues, and our top 50 customers accounted for approximately 13% of revenues, reflecting low customer concentration and significant project diversification within our portfolio.
That differentiation begins with o ur values. Our values are lived through our employees, acknowledged by our vendors and aligned to the needs of our customers and communities. Our values provide the basis of our approach to human capital management as well as how we treat our stakeholders.
Our Company values are lived through our employees, acknowledged by our vendors and aligned to the needs of our customers and communities. Our values provide the basis of our approach to human capital management as well as how we treat our stakeholders.
Sophisticated Logistics and Service Capabilities Building from the largest branch network in the industry, we operate a sophisticated hybrid in-house and outsourced logistics and service infrastructure that we believe is highly differentiated from our competitors and enhances the value proposition we provide to customers.
We believe our ability to drive VAPS growth following our historical acquisitions highlights the value proposition our VAPS provide to our customers. 9 Sophisticated Logistics and Service Capabilities Building from the largest branch network in the industry, we operate a sophisticated hybrid in-house and outsourced logistics and service infrastructure that we believe is highly differentiated from our competitors and enhances the value proposition we provide to customers.
Similarly, technology is continuing to develop related to our fleet and inventory to offer an enhanced experience for our customers. Unit tracking, customer service portals, and other customer‑facing technological benefits differentiate our offering from competitors who have not invested in these capabilities.
Similarly, advancements in technology continue to shape our fleet and inventory, enabling us to offer an enhanced experience for our customers. Unit tracking, customer service portals, and other customer‑facing technological benefits differentiate our offering from competitors who have not invested in these capabilities.
Our updated Nominating and Corporate 18 Governance Committee charter also increases our efforts to identity and seek diverse candidates for our Board, which not only represents our commitment to creating a more diverse Board, but also our commitment to bringing in directors with strong experience to enhance our Board in key areas.
Our Nominating and Corporate Governance Committee oversees our ESG initiatives and is responsible for our efforts to identity and seek diverse candidates for our Board, which not only represents our commitment to creating a more diverse Board, but also our commitment to bringing in directors with strong experience to enhance our Board in key areas.
We protect our products and services through the use of trademarks and patents, none of which are individually material to our business. Our trademarks and patents are registered or pending application for registrations in the US Patent and Trademark Office and various non‑US jurisdictions.
Intellectual Property We operate primarily under the WillScot and Mobile Mini brands. We protect our products and services through the use of trademarks and patents, none of which are individually material to our business. Our trademarks and patents are registered or pending application for registrations in the US Patent and Trademark Office and various non‑US jurisdictions.
Single-wide modular space units include mobile offices and sales offices. These units offer maximum ease of installation and removal and are deployed across the broadest range of applications in our fleet. These units typically have “open interiors,” which can be modified using movable partitions, and include tile floors, air conditioning, heating and filtration units, partitions and toilet facilities.
These units offer maximum ease of installation and removal and are deployed across the broadest range of applications in our fleet. These units typically have “open interiors,” which can be modified using movable partitions, and include tile floors, air conditioning, heating and filtration units, partitions and toilet facilities. Section Modulars and Redi-Plex.
Product Leases We primarily lease, rather than sell, our modular and portable storage units to customers, which results in a highly diversified and predictable reoccurring revenue stream. For the year ended December 31, 2022, over 90% of new lease orders were on our standard lease agreement, pre-negotiated master lease, or national account agreements.
Product Leases We primarily lease, rather than sell, our turnkey temporary space solutions to customers, which results in a highly diversified and predictable recurring revenue stream. For the year ended December 31, 2023, over 90% of new lease orders were on our standard lease agreement, pre-negotiated master lease, or national account agreements.
As such, we have made significant investments in our lease fleet and consolidated several competitors. For the year ended December 31, 2022, our modular space and portable storage lease fleet consisted of over 128 million square feet of relocatable space, comprising over 154,000 office units and approximately 210,000 steel container units.
As such, we have made significant investments in our lease fleet and consolidated several competitors. For the year ended December 31, 2023, our modular space and portable storage lease fleet consisted of approximately 130 million square feet of relocatable space, comprising over 156,000 modular space units and approximately 212,000 portable storage units.
Most recently in 2022, the Company acquired certain assets and liabilities of 13 regional and local modular space and storage businesses and quickly integrated these assets into our leasing portfolio and branch network, given the scalability of our operating platform.
We also acquired certain assets and liabilities of five regional and local modular space and storage businesses in 2023 and, given the scalability of our operating platform, quickly integrated these assets into our leasing portfolio and branch network.
In 2022, our Total Recordable Incident Rate (“TRIR”) was below one, which translates to keeping our employees very safe, and we remain committed to creating a zero harm culture.
In 2023, our Total Recordable Incident Rate (“TRIR”) was less than 1.0, which translates to keeping our employees very safe, and we remain committed to creating a zero-harm culture.
The committee considers a variety of potential risks that may affect the Company, including the competitive and macroeconomic landscape, cybersecurity, environmental health and safety, statutory/regulatory compliance, ESG risks, and ability to scale human capital and business systems for future growth. Intellectual Property We operate primarily under the WillScot and Mobile Mini brands.
The committee considers a variety of potential risks that may affect the Company, including the competitive and macroeconomic landscape, cybersecurity and information technology, environmental health and safety, statutory/regulatory compliance, ESG risks, and ability to scale human capital and business systems for future growth.
Starting in the first quarter of 2023, our US and Canadian Modular and Storage teams will operate in a single CRM system which will provide greater visibility into our customer base and will enhance our ability to cross-sell our portfolio of products to our customers.
Starting in February 2023, our US and Canadian Modular and Storage teams began to operate in a single CRM system which provides greater visibility into our customer base and enhances our ability to cross-sell our portfolio of products to our customers.
Modular space and portable storage solutions are particularly attractive to focused niches such as healthcare facilities, small municipal buildings, courthouses, military installations, national security buildings, and offices during building modernization, as well as disaster relief.
Government and Institutions Government customers consist of national, state, provincial, and local public sector organizations. Modular space and portable storage solutions are particularly attractive to focused niches such as healthcare facilities, small municipal buildings, courthouses, military installations, national security buildings, and offices during building modernization, as well as disaster relief.
We manage our maintenance capex and growth capex to align with the economic conditions in which we operate. Within our existing lease fleet, we examine the potential cash and earnings generation of an asset sale versus continuing to lease the asset.
We continually assess both our existing lease fleet and customer demand for opportunities to deploy capital more efficiently. We manage our maintenance capex and growth capex to align with the economic conditions in which we operate. Within our existing lease fleet, we examine the potential cash and earnings generation of an asset sale versus continuing to lease the asset.
During 2022, we continued our programmatic tuck-in strategy and acquired certain assets and liabilities of several smaller entities, which consisted primarily of 14,100 storage units and 4,400 modular units. We expect to pursue acquisitions opportunistically that will provide further scale efficiencies and allow us to improve returns generated by the acquired assets.
We also continued our programmatic tuck-in strategy and acquired certain assets and liabilities of five smaller entities in 2023, which consisted primarily of approximately 1,800 storage units and 700 modular units. We expect to pursue acquisitions opportunistically that will provide further scale efficiencies and allow us to improve returns generated by the acquired assets.
REVENUE MIX BY END MARKET CUSTOMER CONCENTRATION Proven Track Record Realizing Acquisition Synergies and Deploying Best Practices We have a strong track record of integrations and generating significant revenue and cost synergies with our acquisitions. Since our public listing in 2017, we have executed over 25 acquisitions and divestitures totaling approximately $4.8 billion in cumulative enterprise value.
Proven Track Record Realizing Acquisition Synergies and Deploying Best Practices We have a strong track record of integrating and generating significant revenue and cost synergies with our acquisitions. Since our public listing in 2017, we have executed 33 acquisitions and divestitures totaling approximately $5.4 billion in cumulative enterprise value.
These office units are equipped with electrical wiring, air conditioning, heating and filtration units, phone jacks, carpet or tile, high security doors, and windows with security bars or shutters. Some of these offices are also equipped with sinks, hot water heaters, cabinets and toilet facilities . Other Modular Space.
These office units are equipped with electrical wiring, air conditioning, heating and filtration units, phone jacks, carpet or tile, high security doors, and windows with security bars or shutters. If requested, these offices are also equipped with sinks, hot water heaters, cabinets and restroom facilities . Blast-Resistant Modules.
As of December 31, 2022, we had over 364,000 total units including over 154,000 modular space units, approximately 210,000 portable storage units, and other value-added products representing fleet net book value of $3.1 billion and over 128 million square feet of relocatable commercial space.
As of December 31, 2023, we had over 368,000 total units including over 156,000 modular space units, approximately 212,000 portable storage units, and other value-added products representing fleet net book value of $3.4 billion and approximately 130 million square feet of relocatable commercial space.
Portable storage units continue to find new applications as business needs change and develop. Demand for portable storage is driven by a number of factors, including: • Versatility: portable storage units can be easily customized to suit customer specifications.
Portable storage units also include climate-controlled storage containers, walk-in freezers, refrigerated storage trailers and dock-height refrigerated trailers. Portable storage units continue to find new applications as business needs change and develop. Demand for portable storage is driven by a number of factors, including: • Versatility: portable storage units can be easily customized to suit customer specifications.
We take responsibility for our own well-being and for those around us. • Committed to Inclusion & Diversity: We are stronger together when we celebrate our differences and strive for inclusiveness.
Company Values • Dedicated to Health & Safety: We take responsibility for our own well-being and for those around us. Health and safety are first, last and everything in-between. • Committed to Inclusion & Diversity: We are stronger together when we celebrate our differences and strive for inclusiveness.
Proper safety culture fosters personal accountability, leading to increased safety, active employee engagement and a strong commitment to the Company and our customers. We believe we are operating at high levels of safety and low levels of injury.
We empower and reward employees for being personally accountable and exceeding safety guidelines in every task. Proper safety culture fosters personal accountability, leading to increased safety, active employee engagement and a strong commitment to the Company and our customers. Today, we believe we are operating at high levels of safety and low levels of injury.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe market price of our Common Stock is likely to be affected by (a) changes in general conditions in the economy, geopolitical events or the financial markets; (b) variations in our quarterly operating results; (c) changes in financial estimates by securities analysts; (d) our share repurchase or dividend policies; (e) other developments affecting us, our industry, customers or competitors; (f) changes in demand for our products or the prices we charge due to changes in economic conditions, competition or other factors; (g) general economic conditions in the markets where we operate; (h) the cyclical nature of our customers’ businesses and certain end markets that we service; (i) rental rate changes in response to competitive factors; (j) bankruptcy or insolvency of our customers, thereby reducing demand for our used units; (k) seasonal rental patterns; (l) acquisitions or divestitures and related costs; (m) labor shortages, work stoppages or other labor difficulties; (n) possible unrecorded liabilities of acquired companies; (o) possible write-offs or exceptional charges due to changes in applicable accounting standards, goodwill impairment, or divestiture or impairment of assets; (p) the operating and stock price performance of companies that investors deem comparable to us; (q) the number of shares available for resale in the public markets under applicable securities laws; (r) the composition of our shareholder base; and (s) other unspecified circumstances that may be company specific circumstances or overall industry and market driven.
Biggest changeThe market price of our Common Stock is likely to be affected by (a) changes in general conditions in the economy, geopolitical events or the financial markets; (b) variations in our quarterly operating results; (c) changes in financial estimates by securities analysts; (d) our share repurchase or dividend policies; (e) other developments affecting us, our industry, customers or competitors; (f) changes in demand for our products or the prices we charge due to changes in economic conditions, competition or other factors; (g) general economic conditions in the markets where we operate; (h) the cyclical nature of our customers’ businesses and certain end markets that we service; (i) rental rate changes in response to competitive factors; (j) bankruptcy or insolvency of our customers, thereby reducing demand for our used units; (k) seasonal rental patterns; (l) acquisitions or divestitures and related costs; (m) labor shortages, work stoppages or other labor difficulties; (n) possible unrecorded liabilities of acquired companies; (o) possible write-offs or exceptional charges due to changes in applicable accounting standards, goodwill impairment, or divestiture or impairment of assets; (p) the operating and stock price performance of companies that investors deem comparable to us; (q) the number of shares available for resale in the public markets under applicable securities laws; (r) the composition of our shareholder base; and (s) other unspecified circumstances that may be company specific circumstances or overall industry and market driven. 32 Risks Related to the McGrath Acquisition The McGrath Acquisition may not be completed within the expected timeframe, if at all, and the failure to complete the McGrath Acquisition, or the failure to realize the anticipated synergies from the McGrath Acquisition, may negatively affect the price of our common stock and could adversely affect our financial results.
Under general principles of US government contracting law, if the government terminates a contract for convenience, the terminated company may generally recover only its incurred or committed costs and settlement expenses and profit on work completed prior to the termination.
Under general principles of US government contracting law, if the government terminates a contract for convenience, the terminated company may generally recover only its incurred or committed costs, settlement expenses and profit on work completed prior to the termination.
If we are not able to manage credit risk, or if a large number of customers should have financial difficulties at the same time, our credit and rental equipment losses would increase above historical levels. If this should occur, our business, financial condition, results of operations and cash flows may be materially adversely affected.
If we are not able to manage credit risk, or if a large number of our customers should have financial difficulties at the same time, our credit and rental equipment losses would increase above historical levels. If this should occur, our business, financial condition, results of operations and cash flows may be materially adversely affected.
Acquisitions involve numerous risks, including (a) difficulties in integrating the operations, technologies, 21 management information systems, products and personnel of the acquired companies; (b) diversion of management’s attention from normal daily operations of the business; (c) loss of key employees; (d) difficulties in entering markets in which we have no or limited prior experience and where our competitors in such markets have stronger market positions; (e) difficulties in complying with regulations, such as antitrust and environmental regulations, and managing risks related to an acquired business; (f) an inability to timely obtain financing, including any amendments required to existing financing agreements; (g) an inability to implement uniform standards, controls, procedures and policies; (h) undiscovered and unknown problems, defects, liabilities or other issues related to any acquisition that become known to us only after the acquisition, particularly relating to rental equipment on lease that are unavailable for inspection during the diligence process; and (i) loss of key customers or suppliers.
Acquisitions involve numerous risks, including (a) difficulties in integrating the operations, technologies, management information systems, products and personnel of the acquired companies; (b) diversion of management’s attention from normal daily operations of the business; (c) loss of key employees; (d) difficulties in entering markets in which we have no or limited prior experience and where our competitors in such markets have stronger market positions; (e) difficulties in complying with regulations, such as antitrust and environmental regulations, and managing risks related to an acquired business; (f) an inability to timely obtain financing, including any amendments required to existing financing agreements; (g) an inability to implement uniform standards, controls, procedures and policies; (h) undiscovered and unknown problems, defects, liabilities or other issues related to any acquisition that become known to us only after the acquisition, particularly relating to rental equipment on lease that are unavailable for inspection during the diligence process; and (i) loss of key customers or suppliers.
These requirements include, for example: (a) specialized disclosure and accounting requirements unique to US government contracts; (b) financial and compliance audits that may result in potential liability for price adjustments, recoupment of government funds after such funds have been spent, civil and criminal penalties, or administrative sanctions such as suspension or debarment from doing business with the US government; (c) public disclosures of certain contract and company information; and (d) mandatory socioeconomic compliance requirements, including labor requirements, non-discrimination and affirmative action programs and environmental compliance requirements.
These requirements include, for example: (a) specialized disclosure and accounting requirements unique to US government 21 contracts; (b) financial and compliance audits that may result in potential liability for price adjustments, recoupment of government funds after such funds have been spent, civil and criminal penalties, or administrative sanctions such as suspension or debarment from doing business with the US government; (c) public disclosures of certain contract and company information; and (d) mandatory socioeconomic compliance requirements, including labor requirements, non-discrimination and affirmative action programs and environmental compliance requirements.
In 22 addition, because our systems contain information about individuals and other businesses, the failure to maintain the security of the data we hold, whether the result of our own error or the malfeasance or errors of others, could harm our reputation or give rise to legal liabilities leading to lower revenue, increased costs, regulatory sanctions and other potential material adverse effects on our business, results of operations and financial condition.
In addition, because our systems contain information about individuals and other businesses, the failure to maintain the security of the data we hold, whether the result of our own error or the malfeasance or errors of others, could harm our reputation or give rise to legal liabilities leading to lower revenue, increased costs, regulatory sanctions and other potential material adverse effects on our business, results of operations and financial condition.
We are partly self-insured for a number of different risk categories, such as property, general liability (including product liability), workers' compensation, automobile claims, crime, and cyber liability, with insurance coverage for certain catastrophic risks. The types and amounts of insurance may vary from time to time based on our decisions with respect to risk retention and regulatory requirements.
We are partly self-insured for a number of different risk categories, such as general liability (including product liability), workers' compensation, automobile claims, crime, and cyber liability, with insurance coverage for certain catastrophic risks. The types and amounts of insurance may vary from time to time based on our decisions with respect to risk retention and regulatory requirements.
In addition, attacks or armed conflicts that directly impact one or more of our properties could significantly affect our ability to operate those properties and thereby impair our results of operations. 24 In general, any of these events could cause consumer confidence and spending to decrease or result in increased volatility in the global economy and worldwide financial markets.
In addition, attacks or armed conflicts that directly impact one or more of our properties could significantly affect our ability to operate those properties and thereby impair our results of operations. In general, any of these events could cause consumer confidence and spending to decrease or result in increased volatility in the global economy and worldwide financial markets.
While we maintain certain related insurance coverages, we have no reserves for any such liabilities. We are also required to obtain environmental permits from governmental authorities for certain of our operations. If we violate or fail to obtain or comply with these laws, regulations, or permits, we could be fined or otherwise sanctioned by regulators.
While we maintain certain related insurance coverages, we have no reserves for any such liabilities. 22 We are also required to obtain environmental permits from governmental authorities for certain of our operations. If we violate or fail to obtain or comply with these laws, regulations, or permits, we could be fined or otherwise sanctioned by regulators.
Similar provisions apply with respect to certain state and non-US jurisdictions which could limit our ability to offset taxable income. In addition, at the state level, there may be periods during which the use of NOLs is suspended or otherwise limited, which could 28 accelerate or permanently increase state taxes owed.
Similar provisions apply with respect to certain state and non-US jurisdictions which could limit our ability to offset taxable income. In addition, at the state level, there may be periods during which the use of NOLs is suspended or otherwise limited, which could accelerate or permanently increase state taxes owed.
Our consolidated financial results are denominated in US Dollars, and therefore, during times of a strengthening US Dollar, our reported revenue in non-US Dollar jurisdictions will be reduced because the local currency will translate into fewer US Dollars. Revenue and expenses are translated into US Dollars at the average exchange rate for the period.
Our consolidated financial results are denominated in US Dollars, and therefore, during times of a strengthening US Dollar, our reported revenue in non-US Dollar jurisdictions will be reduced because the local currency will translate into fewer US Dollars. Revenue and expenses are translated into US Dollars at the 28 average exchange rate for the period.
Although these limitations are subject to significant exceptions and qualifications, these covenants could limit our ability to finance future operations and capital needs and our ability to pursue acquisitions and other business activities that may be in our interest. Our subsidiaries’ ability to comply with these covenants and restrictions may be affected by events 30 beyond our control.
Although these limitations are subject to significant exceptions and qualifications, these covenants could limit our ability to finance future operations and capital needs and our ability to pursue acquisitions and other business activities that may be in our interest. Our subsidiaries’ ability to comply with these covenants and restrictions may be affected by events beyond our control.
ITEM 1A. Risk Factors Risks Relating to Our Business We are subject to various laws and regulations, including recent pronouncements related to laws and regulations governing antitrust, climate related disclosures, cybersecurity, privacy, government contracts, anti-corruption and the environment. Obligations and liabilities under these laws and regulations may materially harm our business.
ITEM 1A. Risk Factors Risks Relating to Our Business We are subject to various laws and regulations, including recent pronouncements related to laws and regulations governing antitrust, climate related disclosures, privacy, government contracts, anti-corruption and the environment. Obligations and liabilities under these laws and regulations may materially harm our business.
Price competition, together with other forms of competition, may materially adversely affect our business, results of operations and financial condition. If we do not manage our credit risk effectively, collect on our accounts receivable, or recover our rental equipment from our customers, it could materially adversely affect our business, financial condition and results of operations.
Price competition, together with other forms of competition, may materially adversely affect our business, results of operations and financial condition. 24 If we do not manage our credit risk effectively, collect on our accounts receivable, or recover our rental equipment from our customers, it could materially adversely affect our business, financial condition and results of operations.
These operations may be more highly affected by labor force activities than others, and all collective bargaining agreements must be renegotiated 23 annually. Other locations may also face organizing activities or effects. Labor organizing activities could result in additional employees becoming unionized.
These operations may be more highly affected by labor force activities than others, and all collective bargaining agreements must be renegotiated annually. Other locations may also face organizing activities or effects. Labor organizing activities could result in additional employees becoming unionized.
Sale transactions are subject to certain factors that are beyond our control, including permit requirements, the timely completion of prerequisite work by others and weather conditions. Accordingly, the actual timing of the completion of these transactions may take longer than we expect.
Sale transactions are subject to certain factors that 26 are beyond our control, including permit requirements, the timely completion of prerequisite work by others and weather conditions. Accordingly, the actual timing of the completion of these transactions may take longer than we expect.
A poor safety ranking may result in the loss of customers or 20 difficulty attracting and retaining qualified drivers which could affect our results of operations. Should additional rules be enacted in the future, compliance with such rules could result in additional costs.
A poor safety ranking may result in the loss of customers or difficulty attracting and retaining qualified drivers which could affect our results of operations. Should additional rules be enacted in the future, compliance with such rules could result in additional costs.
The information available will differ from counterparty to counterparty and may be insufficient for us to adequately interpret or evaluate our exposure and/or determine appropriate or timely responses. 29 Our leverage may make it difficult for us to service our debt and operate our business.
The information available will differ from counterparty to counterparty and may be insufficient for us to adequately interpret or evaluate our exposure and/or determine appropriate or timely responses. Our leverage may make it difficult for us to service our debt and operate our business.
Impairment may result from, among other things, deterioration in the performance of the business, adverse market conditions, stock price and adverse changes in applicable laws and regulations, including changes that restrict our activities.
Impairment may result from, among other things, deterioration in the 29 performance of the business, adverse market conditions, stock price and adverse changes in applicable laws and regulations, including changes that restrict our activities.
In addition, our future effective tax rate could be adversely affected by changes to our operating structure, changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation allowance of deferred tax assets, changes in tax laws and the discovery of new information in the course of our tax return preparation process.
In addition, our future effective tax rate could be adversely affected by changes to our operating structure, changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation allowance of deferred tax assets, changes in tax laws and the discovery of new information during our tax return preparation process.
The False Claims Act statute provides for treble damages and other penalties, and if our operations are found to be in violation of the False Claims Act, we could face other adverse action, including suspension or prohibition from doing business with the US government.
The False Claims Act statute provides for treble damages and other penalties, and if our operations are found to be in violation of the False Claims Act, we could face other adverse actions, including suspension or prohibition from doing business with the US government.
Recent Pronouncements Recent pronouncements by the SEC, Federal Trade Commission, Department of Justice, and from the state of California, among others, related to antitrust, climate related disclosures, cybersecurity and privacy could have the impact of increasing Company compliance costs, increasing potential liability to the Company as a result of frivolous lawsuits, or place the Company in a position of not knowing when or if the laws are settled in a particular area in order for the Company to effectively comply.
Recent Pronouncements Recent pronouncements by the SEC, Federal Trade Commission, Department of Justice, and the state of California, among others, related to antitrust, climate related disclosures, and privacy could have the impact of increasing Company compliance costs, increasing potential liability to the Company as a result of frivolous lawsuits, or place the Company in a position of not knowing when or if the laws are settled in a particular area for the Company to effectively comply.
Our operations in any of these countries could be affected by foreign and domestic economic, political and regulatory risks, including (a) regulatory requirements that are subject to change and that could restrict our ability to assemble, lease or sell products; (b) inflation, recession, and fluctuations in foreign currency exchange and interest rates; (c) trade protection measures, including increased duties and taxes and import or export licensing requirements; (d) compliance with applicable antitrust and other regulatory rules and regulations relating to potential acquisitions; (e) different local product preferences and product requirements; (f) pressures on management time and attention due to the complexities of overseeing multi-national operations; (g) challenges in maintaining staffing; (h) different labor regulations and the potential impact of collective bargaining; (i) potentially adverse consequences from changes in, or interpretations of, tax laws; (j) potentially adverse consequences from change in, or interpretation of, securities laws and other financial reporting regulations; (k) political and economic instability; (l) enforcement of remedies in various jurisdictions; (m) the risk that the business partners upon whom we depend for technical assistance will not perform as expected; (n) compliance with applicable export control laws and economic sanctions laws and regulations; (o) price controls and ownership regulations; (p) obstacles to the repatriation of earnings and cash; (q) differences in business practices that may result in violation of Company policies, including, but not limited to, bribery and collusive practices; and (r) reduced protection for intellectual property in some countries.
Our operations in any of these countries could be affected by foreign and domestic economic, political and regulatory risks, including (a) regulatory requirements that are subject to change and that could restrict our ability to assemble, lease or sell products; (b) economic downturns, inflationary and recessionary markets, including in capital and equity markets, fluctuations in foreign currency exchange and interest rates; (c) trade protection measures, including increased duties and taxes and import or export licensing requirements; (d) compliance with applicable antitrust and other regulatory rules and regulations relating to potential acquisitions; (e) different local product preferences and product requirements; (f) pressures on management time and attention due to the complexities 27 of overseeing multi-national operations; (g) challenges in maintaining staffing; (h) different labor regulations and the potential impact of collective bargaining; (i) potentially adverse consequences from changes in, or interpretations of, tax laws; (j) potentially adverse consequences from change in, or interpretation of, securities laws and other financial reporting regulations; (k) political and economic instability; (l) enforcement of remedies in various jurisdictions; (m) the risk that the business partners upon whom we depend for technical assistance will not perform as expected; (n) compliance with applicable export control laws and economic sanctions laws and regulations; (o) price controls and ownership regulations; (p) obstacles to the repatriation of earnings and cash; (q) differences in business practices that may result in violation of Company policies, including, but not limited to, bribery and collusive practices; and (r) reduced protection for intellectual property in some countries.
Failure to close our unit sales transactions as we project could cause our actual revenue or cash flow for a particular fiscal period to differ from expectations. Sales of new and used modular space and portable storage units to customers represented approximately 4.3% of WillScot Mobile Mini's revenue during the year ended December 31, 2022.
Failure to close our unit sales transactions as we project could cause our actual revenue or cash flow for a particular fiscal period to differ from expectations. Sales of new and used modular space and portable storage units to customers represented approximately 4% of WillScot Mobile Mini's revenue during the year ended December 31, 2023.
In addition, the availability of raw materials components fluctuates from time to time due to factors outside of our control, including trade laws and tariffs, natural disasters, global pandemics, supply chain constraints and disruptions, and may 27 impact our ability to meet the production demands of our customers.
In addition, the availability of raw materials components fluctuates from time to time due to factors outside of our control, including trade laws and tariffs, natural disasters, global pandemics, military conflicts, supply chain constraints and disruptions, and may impact our ability to meet the production demands of our customers.
The measures that we employ to protect our systems may not detect or prevent cybersecurity breaches, natural disasters, terrorist attacks, telecommunication failures, computer viruses, hackers, phishing attacks, and other security issues.
The measures that we employ to protect our systems may not detect or prevent cybersecurity threats or incidents, natural disasters, terrorist attacks, telecommunication failures, computer viruses, hackers, phishing attacks, and other security issues.
In connection with our business, to better serve our customers and optimize our capital expenditures, we often move our fleet from branch to branch. In addition, the majority of our customers arrange for delivery and pickup of our units through us.
In connection with our business, to better serve our customers and optimize our capital expenditures, we often move our fleet from branch to branch. In addition, most of our customers arrange for delivery and pickup of our units through us.
We have previously been the target of an attempted cyber attack and have from time to time experienced threats to our data and systems, computer virus attacks and phishing attempts, and we may be subject to breaches of the information systems that we use. We have not experienced a material cybersecurity breach.
We have previously been the target of attempted cyber-attacks and have, from time to time, experienced threats to our data and information systems, computer virus attacks and phishing attempts, and we may be subject to breaches of the information systems that we use. We have not experienced a material cybersecurity incident.
We compete on the basis of a number of factors, including customer relationships, product quality and availability, delivery speed, VAPS and service capabilities, pricing, and overall ease of doing business.
We compete based on of a number of factors, including customer relationships, product quality and availability, delivery speed, VAPS and service capabilities, pricing, and overall ease of doing business.
We may incur increased legal costs and indirect labor costs as a result of contractual disputes, negotiations or other labor-related disruptions. We have collective bargaining agreements with employees in portions of our Mexico-based operations, which accounted for approximately 1% of our total employees as of December 31, 2022.
We may incur increased legal costs and indirect labor costs as a result of contractual disputes, negotiations or other labor-related disruptions. We have collective bargaining agreements with employees in portions of our Mexico-based operations, which accounted for less than 1% of our total employees as of December 31, 2023.
Our operations are exposed to operational, economic, political and regulatory risks. We operate in the US, Canada, and Mexico. For the year ended December 31, 2022, approximately 93%, 6%, and 1% of our revenue was generated in the US, Canada, and Mexico, respectively.
Our operations are exposed to operational, economic, political and regulatory risks. We operate in the US, Canada, and Mexico. For the year ended December 31, 2023, approximately 94%, 5%, and 1% of our revenue was generated in the US, Canada, and Mexico, respectively.
As of December 31, 2022, we had approximately $1,011.4 million and $419.1 million of goodwill and intangible assets, net, respectively, in our consolidated balance sheet, which represented approximately 17.4% and 7.2% of total assets, respectively, and primarily arose through our acquisition of Mobile Mini.
As of December 31, 2023, we had approximately $1,176.6 million and $419.7 million of goodwill and intangible assets, net, respectively, in our consolidated balance sheet, which represented approximately 19.2% and 6.8% of total assets, respectively, and primarily arose through our acquisition of Mobile Mini.
If we are not able to successfully manage our lease assets, our business, results of operations and financial condition may be materially adversely affected. 26 If we do not appropriately manage the design, manufacture, repair and maintenance of our product fleet, or if we delay or defer such repair or maintenance or suffer unexpected losses of rental equipment due to theft or obsolescence, we may be required to incur impairment charges for equipment that is beyond economic repair or incur significant capital expenditures to acquire new rental equipment to serve demand.
If we do not appropriately manage the design, manufacture, repair and maintenance of our product fleet, or if we delay or defer such repair or maintenance or suffer unexpected losses of rental equipment due to theft or obsolescence, we may be required to incur impairment charges for equipment that is beyond economic repair or incur significant capital expenditures to acquire new rental equipment to serve demand.
We must continue to take actions to realize the combined cost synergies that we forecast for the acquisition. We may incur more costs than we anticipated to achieve the forecast synergies (thus reducing the net benefit of the cost synergies), realize synergies later than we expected or fail altogether to achieve a portion of the cost savings we anticipated.
We may incur more costs than we anticipated to achieve the forecast synergies (thus reducing the net benefit of the cost synergies), realize synergies later than we expected or fail altogether to achieve a portion of the cost savings or commercial synergies we anticipated.
The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations, subject us to investigations from regulatory authorities or cause stockholders to lose confidence in our reported financial information, all of which could materially and adversely affect us. 25 We are subject to evolving public disclosure, financial reporting and corporate governance expectations and regulations that impact compliance costs and risks of noncompliance.
The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations, subject us to investigations from regulatory authorities or cause stockholders to lose confidence in our reported financial information, all of which could materially and adversely affect us.
As of December 31, 2022, we had $3,120.9 million of total indebtedness, excluding deferred financing fees, consisting of $2,020.0 million of borrowings under our ABL Facility, $526.5 million of our 2025 Secured Notes, $500.0 million of our 2028 Secured Notes and $74.4 million of finance leases.
As of December 31, 2023, we had $3.6 billion of total indebtedness, excluding deferred financing fees, consisting of $2.0 billion of borrowings under our ABL Facility, $526.5 million of our 2025 Secured Notes, $500.0 million of our 2028 Secured Notes, $500.0 million of our 2031 Secured Notes, and $117.1 million of finance leases.
We may not be able to adequately protect our intellectual property and other proprietary rights that are material to our business. Our ability to compete effectively depends in part upon protection of our rights in trademarks, copyrights and other intellectual property rights we own or license, including patents to the Mobile Mini locking system.
Our ability to compete effectively depends in part upon protection of our rights in trademarks, copyrights and other intellectual property rights we own or license, including patents to the Mobile Mini locking system.
The occurrence of significant claims, a substantial rise in costs to maintain our insurance, or the failure to maintain adequate insurance coverage could have an adverse impact on our financial condition and results of operations.
Effective August 1, 2023, we are self-insured for property risks. The occurrence of significant claims, a substantial rise in costs to maintain our insurance, or the failure to maintain adequate insurance coverage could have an adverse impact on our financial condition and results of operations.
A decline or slowed growth in any of these sectors or geographic regions could result in reduced demand for our products and services, which may materially adversely affect our business, results of operations and financial condition.
A decline or slowed growth in any of these sectors or geographic regions could result in reduced demand for our products and services, which may materially adversely affect our business, results of operations and financial condition. 23 Any failure of our management information systems could disrupt our business operations, which could result in decreased lease or sale revenue and increase overhead costs.
A s of December 31, 2022, excluding amounts in held for sale or attributable to disposable businesses (see Note 3), we had US net operating loss (“NOL”) carryforwards of approximately $1,011.7 million and $484.3 million for US federal income tax and state tax purposes, respectively, available to offset future taxable income, prior to consideration of annual limitations that Section 382 of the Internal Revenue Code of 1986 may impose.
A s of December 31, 2023, we had US net operating loss (“NOL”) carryforwards of approximately $465.2 million and $240.3 million for US federal income tax and state tax purposes, respectively, available to offset future taxable income, prior to consideration of annual limitations that Section 382 of the Internal Revenue Code of 1986 may impose.
Our ability to effectively manage our business depends significantly on the reliability and capacity of these systems. The failure of our management information systems to perform as anticipated could damage our reputation with our customers, disrupt our business or result in, among other things, decreased lease and sales revenue and increased overhead costs.
The failure of our management information systems to perform as anticipated could damage our reputation with our customers, disrupt our business or result in, among other things, decreased lease and sales revenue and increased overhead costs. Any such failure could harm our business, results of operations and financial condition.
We also maintain or replace a truck fleet to deliver units to and return units from our customers, the cost of which is sensitive to maintenance and fuel costs and rental rates on leased equipment.
Generally, increases in labor and raw material costs will increase the acquisition costs of new units and also increase the repair and maintenance costs of our fleet. We also maintain a truck fleet to deliver units to and return units from our customers, the cost of which is sensitive to maintenance, replacement, fuel costs, and rental rates on leased equipment.
Changes in tax laws or regulations, including changes in the US related to the treatment of accelerated depreciation expense, carry-forwards of net operating losses, and taxation of foreign income and expenses may increase tax uncertainty and adversely affect our results of operations.
Changes in tax laws or regulations, including changes in the US related to the treatment of accelerated depreciation expense, carry-forwards of net operating losses, and taxation of foreign income and expenses may increase tax uncertainty and adversely affect our results of operations. 30 Risks Relating to Our Capital Structure Global capital and credit market conditions could materially and adversely affect our ability to access the capital and credit markets or the ability of key counterparties to perform their obligations to us.
Our US NOL and tax credit carryforwards could expire unused and be unavailable to offset future income tax liabilities.
The US NOL carryforwards begin to expire in 2025 for state and 2037 for federal if not utilized. Our US NOL and tax credit carryforwards could expire unused and be unavailable to offset future income tax liabilities.
In addition, certain of our customers are facing financial pressure and such pressure, or other factors, may result in consolidation in some industries and/or an increase in bankruptcy filings by certain customers. Each of these facts and industry impacts, individually or in the aggregate, could have a materially adverse effect on our operating results.
In addition, certain of our customers are facing financial pressure and such pressure, or other factors, may result in consolidation in some industries and/or an increase in bankruptcy filings by certain customers.
In addition, the credit agreement that governs our credit facility and the indentures do not prevent us from incurring other obligations that do not constitute indebtedness under those agreements. If we add debt to our and our subsidiaries’ existing debt levels, the risks associated with our substantial indebtedness described above, including our possible inability to service our debt, will increase.
In addition, the credit agreement that governs our credit facility and the indentures do not prevent us from incurring other obligations that do not constitute indebtedness under those agreements.
Any failure of our management information systems could disrupt our business operations, which could result in decreased lease or sale revenue and increase overhead costs. We rely heavily on information systems across our operations. We also utilize third-party cloud providers to host certain of our applications and to store data.
We rely heavily on information systems across our operations. We also utilize third-party cloud providers to host certain of our applications and to store data. Our ability to effectively manage our business depends significantly on the reliability and capacity of these systems.
Removed
Any such failure could harm our business, results of operations and financial condition.
Added
We must continue to take actions to realize the combined cost synergies and commercial synergies that we forecast for our acquisitions.
Removed
For the year ended December 31, 2022, approximately 65.0% and 35.0%, of our revenue was derived from our Modular Solutions business and Storage Solutions business, respectively.
Added
Each of these facts and industry impacts, individually or in the aggregate, could have a materially adverse effect on our operating results. 25 We may not be able to adequately protect our intellectual property and other proprietary rights that are material to our business.
Removed
Generally, increases in labor and raw material costs will increase the acquisition costs of new units and also increase the repair and maintenance costs of our fleet.
Added
We are subject to evolving public disclosure, financial reporting and corporate governance expectations and regulations that impact compliance costs and risks of noncompliance.
Removed
The US NOL carryforwards begin to expire in 2023 for state and federal if not utilized. In addition, we had foreign NOLs of $2.6 million as a result of operations in Canada. Our Canada NOL carryforwards begin to expire in 2032 if not utilized.
Added
If we are not able to successfully manage our lease assets, our business, results of operations and financial condition may be materially adversely affected.
Removed
Risks Relating to Our Capital Structure Global capital and credit market conditions could materially and adversely affect our ability to access the capital and credit markets or the ability of key counterparties to perform their obligations to us.
Added
If we add debt to 31 our and our subsidiaries’ existing debt levels, the risks associated with our substantial indebtedness described above, including our possible inability to service our debt, will increase.
Added
The McGrath Acquisition is subject to risks and uncertainties, including: (i) the risk that it may not be completed, or completed within the expected timeframe, including as a result of the possibility that a governmental entity may prohibit, delay or refuse an approval required to complete the acquisition; or (ii) costs relating to the acquisition, including the financing thereof, may be greater than expected.
Added
If the McGrath Acquisition is not completed, or there are significant delays in completing the McGrath Acquisition, the trading price of our common stock could be negatively impacted and our business and financial results may be adversely affected.
Added
The failure to consummate the McGrath Acquisition could also result in a negative reaction from the financial markets, particularly if the current market prices reflect market assumptions that the McGrath Acquisition will be completed, which could cause the value of our common stock to decline.
Added
Additionally, the anticipated benefits of the McGrath Acquisition, including anticipated cost savings, will depend on our ability to realize anticipated synergies. Our success in realizing these cost synergies, and the timing thereof, will depend our ability to integrate McGrath successfully.
Added
Even if we integrate McGrath successfully, we may not realize the full benefits of the anticipated cost synergies, and we cannot guarantee that these benefits will be achieved within anticipated timeframes or at all. For example, we may not be able to eliminate duplicative costs. Moreover, we may incur unanticipated expenses in connection with the integration.
Added
While it is anticipated that certain expenses will be incurred to achieve cost synergies, such expenses are difficult to estimate accurately and may exceed current estimates. Accordingly, the benefits from the McGrath Acquisition may be offset by costs incurred to, or delays in, integrating the businesses.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. Properties Our primary corporate headquarters is located in Phoenix, Arizona. We operate approximately 240 branch locations and additional drop lots across the US, Canada, and Mexico. Collectively, we lease approximately 83% of our branch properties and own the remaining balance.
Biggest changeITEM 2. Properties Our primary corporate headquarters is located in Phoenix, Arizona. We operate approximately 250 branch locations and additional drop lots across the US, Canada, and Mexico. Collectively, we lease approximately 84% of our branch properties and own the remaining balance.
Subject to certain exceptions, substantially all of our owned real and personal property in the US and Canada is encumbered under our credit facility and our secured notes. We do not believe that the encumbrances will materially detract from the value of our properties, or materially interfere with their use in the operation of our business. 31
Subject to certain exceptions, substantially all of our owned real and personal property in the US and Canada is encumbered under our credit facility and our secured notes. We do not believe that the encumbrances will materially detract from the value of our properties, or materially interfere with their use in the operation of our business. 34

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed2 unchanged
Biggest changeAs of December 31, 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.
Biggest changeAs of December 31, 2023, 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.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table summarizes our purchase of Common Stock during the fourth quarter of 2022: Period Total Number of Shares and Equivalents Purchased (in thousands) Average Price Paid per Share Total Numbers of Shares and Equivalents Purchased as part of Publicly Announced Plan (in thousands) Maximum Dollar Value of Shares and Equivalents that May Yet Be Purchased Under the Plan (in thousands) October 1, 2022 - October 31, 2022 2,471.1 $ 41.70 2,471.1 $ 760,249 November 1, 2022 - November 30, 2022 1,325.7 $ 45.98 1,325.7 $ 699,261 December 1, 2022 - December 31, 2022 1,482.5 $ 46.15 1,482.5 $ 630,822 Total 5,279.3 $ 44.03 5,279.3 33 Performance Graph The following stock price performance graph should not be deemed incorporated by reference by any general statement incorporating by reference this Annual Report on Form 10-K into any filing under the Exchange Act or the Securities Act of 1933, as amended, except to the extent that we specifically incorporate this information by reference and shall not otherwise be deemed filed under such acts.
Biggest changeThe following table summarizes our purchase of Common Stock during the fourth quarter of 2023: Period Total Number of Shares and Equivalents Purchased (in thousands) Average Price Paid per Share Total Numbers of Shares and Equivalents Purchased as part of Publicly Announced Plan (in thousands) Maximum Dollar Value of Shares and Equivalents that May Yet Be Purchased Under the Plan (in thousands) October 1, 2023 to October 31, 2023 2,087.2 $ 40.13 2,087.2 $ 550.4 November 1, 2023 to November 30, 2023 1,408.8 $ 37.05 1,408.8 $ 498.2 December 1, 2023 to December 31, 2023 — $ — — $ 498.2 Total 3,496.0 3,496.0 36 Performance Graph The following stock price performance graph should not be deemed incorporated by reference by any general statement incorporating by reference this Annual Report on Form 10-K into any filing under the Exchange Act or the Securities Act of 1933, as amended, except to the extent that we specifically incorporate this information by reference and shall not otherwise be deemed filed under such acts.
The graph plots the growth in value of an initial investment of $100 in each of our common shares, the Russell 3000 Index, the S&P 400 Index and the Russell 1000 Index over the indicated time periods, and as sumes reinvestment of all dividends, if any, paid on the securities.
The graph plots the growth in value of an initial investment of $100 in each of our common shares, the S&P 400 Index and the Russell 1000 Index over the indicated time periods, and as sumes reinvestment of all dividends, if any, paid on the securities.
We have strong reoccurring cash flows, which gives us flexibility in how we allocate capital, and we review the appropriate mix of growth investments, debt reduction, and returns to shareholders on an ongoing basis.
We have strong recurring cash flows, which gives us flexibility in how we allocate capital, and we review the appropriate mix of growth investments, debt reduction, and returns to shareholders on an ongoing basis.
The stock repurchase program does not obligate us 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. As of December 31, 2022, $630.8 million of the $1.0 billion share repurchase authorization remained available for use.
The stock repurchase program does not obligate us 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. As of December 31, 2023, $498.2 million of the $1.0 billion share repurchase authorization remained available for use.
The Company had 207,951,682 shares of Common Stock issued and outstanding as of December 31, 2022. The outstanding shares of the Company's Common Stock are duly authorized, validly issued, fully paid and non-assessable. Preferred Stock Our certificate of incorporation authorizes the issuance of 1,000,000 shares of Preferred Stock with a par value of $0.0001 per share.
The Company had 189,967,135 shares of Common Stock issued and outstanding as of December 31, 2023. The outstanding shares of the Company's Common Stock are duly authorized, validly issued, fully paid and non-assessable. Preferred Stock Our certificate of incorporation authorizes the issuance of 1,000,000 shares of Preferred Stock with a par value of $0.0001 per share.
The graph below compares the cumulative total return of our Common Stock from January 1, 2018 through December 31, 2022, with the comparable cumulative return of three indices: the Russell 3000 Index, the S&P 400 Index and the Russell 1000 Index.
The graph below compares the cumulative total return of our Common Stock from January 1, 2019 through December 31, 2023, with the comparable cumulative return of two indices: the S&P 400 Index and the Russell 1000 Index.
As of December 31, 2022, no shares of Preferred Stock were issued and outstanding, and no designation of rights and preferences of preferred stock had been adopted. Holders As of December 31, 2022, there were 42 holders of record of our Common Stock and no holders of record of our Preferred Stock.
As of December 31, 2023, no shares of Preferred Stock were issued and outstanding, and no designation of rights and preferences of preferred stock had been adopted. Holders As of February 14, 2024, there were 30 holders of record of our Common Stock and no holders of record of our Preferred Stock.
Repurchases In July 2022, the Company's Board of Directors approved an increase to the Company's share repurchase program that authorizes the Company to repurchase up to $1.0 billion of its outstanding shares of Common Stock and equivalents.
Repurchases In May 2023, the Board of Directors approved a reset of the share repurchase program authorizing the Company to repurchase up to $1.0 billion of its outstanding shares of Common Stock and equivalents.
Removed
We began showing the cumulative return of the Russell 1000 Index in 2022, as the Russell 1000 Index includes our peer group of issuers.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

143 edited+87 added−83 removed63 unchanged
Biggest changeThe following tables provide unaudited reconciliations of Income from continuing operations to Adjusted EBITDA: 2022 (in thousands) Q1 Q2 Q3 Q4 Full Year Income from continuing operations $ 39,048 $ 60,099 $ 78,176 $ 99,018 $ 276,341 Income tax expense from continuing operations 12,083 20,848 28,288 27,644 88,863 Income from continuing operations before income tax 51,131 80,947 106,464 126,662 365,204 Interest expense 30,570 33,153 38,009 44,546 146,278 Depreciation and amortization 72,910 78,181 83,671 84,337 319,099 Currency losses, net 137 (173) 160 762 886 Restructuring costs, lease impairment expense and other related charges 263 (95) — — 168 Transaction costs 13 22 — (10) 25 Integration costs 4,087 5,193 3,902 2,302 15,484 Stock compensation expense 6,273 9,128 7,111 7,101 29,613 Other 2,389 2,287 51 2,390 7,117 Adjusted EBITDA from continuing operations 167,773 208,643 239,368 268,090 883,874 Adjusted EBITDA from discontinued operations 24,050 24,693 25,045 11,989 85,750 Adjusted EBITDA from continuing and discontinued operations $ 191,823 $ 233,336 $ 264,413 $ 280,079 $ 969,624 50 2021 (in thousands) Q1 Q2 Q3 Q4 Full Year (Loss) income from continuing operations $ (6,147) $ 10,050 $ 48,580 $ 62,412 $ 114,895 Income tax expense from continuing operations 7,302 15,803 3,130 10,293 36,528 (Loss) income from continuing operations before income tax 1,155 25,853 51,710 72,705 151,423 Loss on extinguishment of debt 3,185 2,814 — — 5,999 Interest expense 29,567 28,802 28,798 29,191 116,358 Fair value (gain) loss on common stock warrant liabilities 27,207 (610) — — 26,597 Depreciation and amortization 67,163 74,673 66,775 71,956 280,567 Currency losses (gains), net 37 41 8 341 427 Restructuring costs, lease impairment expense and other related charges 4,393 7,434 2,457 470 14,754 Transaction costs 844 — 303 228 1,375 Integration costs 7,342 7,622 8,242 5,204 28,410 Stock compensation expense 3,494 4,641 6,138 4,455 18,728 Other (694) 1,801 1,517 2,342 4,966 Adjusted EBITDA from continuing operations 143,693 153,071 165,948 186,892 649,604 Adjusted EBITDA from discontinued operations 19,892 22,424 24,201 24,272 90,789 Adjusted EBITDA from continuing and discontinued operations $ 163,585 $ 175,495 $ 190,149 $ 211,164 $ 740,393 The following tables provide unaudited reconciliations of Income (loss) from discontinued operations to Adjusted EBITDA: 2022 (in thousands) Q1 Q2 Q3 Q4 Full Year Income (loss) from discontinued operations $ 12,123 $ 13,277 $ 50,417 $ (12,618) $ 63,199 Gain on sale of discontinued operations — — 34,049 1,407 35,456 Income tax expense from discontinued operations 3,664 3,863 3,917 24,281 35,725 Income from discontinued operations before income tax and gain on sale 15,787 17,140 20,285 10,256 63,468 Interest expense 422 422 299 158 1,301 Depreciation and amortization 7,771 9,188 5,650 1,799 24,408 Currency losses, net 1 46 76 15 138 Stock compensation expense 122 164 (151) 80 215 Other (53) (2,267) (1,114) (319) (3,780) Adjusted EBITDA from discontinued operations $ 24,050 $ 24,693 $ 25,045 $ 11,989 $ 85,750 51 2021 (in thousands) Q1 Q2 Q3 Q4 Full Year Income from discontinued operations $ 10,594 $ 10,321 $ 12,523 $ 11,811 $ 45,249 Income tax expense from discontinued operations 3,179 3,025 3,514 3,300 13,018 Income from discontinued operations before income tax and gain on sale 13,773 13,346 16,037 15,111 58,267 Interest expense 397 410 403 419 1,629 Depreciation and amortization 6,859 9,842 8,501 9,798 35,000 Currency losses, net (1) (8) 119 11 121 Restructuring costs, lease impairment expense and other related charges 2 — — — 2 Integration costs — — 5 9 14 Stock compensation expense 20 66 121 54 261 Other (1,158) (1,232) (985) (1,130) (4,505) Adjusted EBITDA from discontinued operations $ 19,892 $ 22,424 $ 24,201 $ 24,272 $ 90,789 Adjusted EBITDA Margin We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue.
Biggest changeBecause of these limitations, Adjusted EBITDA should not be considered as discretionary cash available to reinvest in the growth of our business or as a measure of cash that will be available to meet our obligations. 52 The following table provides unaudited reconciliations of Income from continuing operations to Adjusted EBITDA: Year Ended December 31, (in thousands) 2023 2022 2021 Income from continuing operations $ 341,844 $ 276,341 $ 114,895 Income tax expense from continuing operations 126,575 88,863 36,528 Income from continuing operations before income tax 468,419 365,204 151,423 Loss on extinguishment of debt — — 5,999 Interest expense 205,040 146,278 116,358 Fair value loss on common stock warrant liabilities — — 26,597 Depreciation and amortization 338,654 319,099 280,567 Currency losses, net 6,754 886 427 Restructuring costs, lease impairment expense and other related charges 22 168 14,754 Transaction costs 2,259 25 1,375 Integration costs 10,366 15,484 28,410 Stock compensation expense 34,486 29,613 18,728 Other (4,535) 7,117 4,966 Adjusted EBITDA from continuing operations 1,061,465 883,874 649,604 Adjusted EBITDA from discontinued operations 4,124 85,750 90,789 Adjusted EBITDA from continuing and discontinued operations $ 1,065,589 $ 969,624 $ 740,393 The following table provides unaudited reconciliations of Income from discontinued operations to Adjusted EBITDA: Year Ended December 31, (in thousands) 2023 2022 2021 Income from discontinued operations $ 134,243 $ 63,199 $ 45,249 Gain on sale of discontinued operations 175,708 35,456 — Income tax expense from discontinued operations 45,468 35,725 13,018 Income from discontinued operations before income tax and gain on sale 4,003 63,468 58,267 Interest expense 56 1,301 1,629 Depreciation and amortization — 24,408 35,000 Currency losses, net — 138 121 Restructuring costs, lease impairment expense and other related charges — — 2 Integration costs — — 14 Stock compensation expense (196) 215 261 Other 261 (3,780) (4,505) Adjusted EBITDA from discontinued operations $ 4,124 $ 85,750 $ 90,789 53 Adjusted EBITDA Margin We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue.
Loss on Extinguishment of Debt: For the year ended December 31, 2021, we recorded a loss on extinguishment of debt of $6.0 million related to the redemption premium and write off of unamortized deferred financing costs associated with the redemption of $123.5 million of our 2025 Secured Notes.
Loss on Extinguishment of Debt: For the year ended year ended December 31, 2021, we recorded a loss on extinguishment of debt of $6.0 million related to the redemption premium and write off of unamortized deferred financing costs associated with the redemption of $123.5 million of our 2025 Secured Notes.
Income Tax Expense: Income tax expense increased $52.3 million to $88.9 million for the year ended December 31, 2022 compared to $36.5 million for the year ended December 31, 2021. The increase in income tax expense was a result of higher pre-tax income partially offset with a reduction of the valuation allowance for deferred tax assets.
Income Tax Expense: Income tax expense increased $52.3 million to $88.9 million for the year ended December 31, 2022 compared to a $36.5 million for the year ended December 31, 2021. The increase in income tax expense was a result of higher pre-tax income partially offset with a reduction of the valuation allowance for deferred tax assets.
Some of these limitations are: • Adjusted EBITDA does not reflect changes in, or cash requirements for our working capital needs; 49 • Adjusted EBITDA does not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness; • Adjusted EBITDA does not reflect our tax expense or the cash requirements to pay our taxes; • Adjusted EBITDA does not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments; • Adjusted EBITDA does not reflect the impact on earnings or changes resulting from matters that we consider not to be indicative of our future operations; • although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and Adjusted EBITDA does not reflect any cash requirements for such replacements; and • other companies in our industry may calculate Adjusted EBITDA differently, limiting its usefulness as a comparative measure.
Some of these limitations are: • Adjusted EBITDA does not reflect changes in, or cash requirements for our working capital needs; • Adjusted EBITDA does not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness; • Adjusted EBITDA does not reflect our tax expense or the cash requirements to pay our taxes; • Adjusted EBITDA does not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments; • Adjusted EBITDA does not reflect the impact on earnings or changes resulting from matters that we consider not to be indicative of our future operations; • although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and Adjusted EBITDA does not reflect any cash requirements for such replacements; and • other companies in our industry may calculate Adjusted EBITDA differently, limiting its usefulness as a comparative measure.
Leasing revenue increased $369.2 million, or 29.5%, as compared to 2021 driven by an increase of 37,294, or 15.7%, in total average modular space and portable storage units on rent and improved pricing and value-added products. Delivery and installation revenues increased $108.0 million, or 33.6%, due to increased overall activity and higher pricing.
Leasing revenue increased $369.2 million, or 29.5%, as compared to 2021 driven by an increase of 37,294, or 15.7%, total average modular space and portable storage units on rent and improved pricing and value-added products. Delivery and installation revenues increased $108.0 million, or 33.6%, due to increased overall activity and higher pricing.
Deferred tax liabilities are recognized for the income taxes on the undistributed earnings of wholly-owned foreign subsidiaries unless such earnings are indefinitely reinvested, or will only be repatriated when possible to do so at minimal additional tax cost. Current income tax relating to items recognized directly in equity is recognized in equity and not in profit (loss) for the year.
Deferred tax liabilities are recognized for the income taxes on the undistributed earnings of wholly-owned foreign subsidiaries unless such earnings are indefinitely reinvested, or will only be repatriated when possible to do so at minimal additional tax cost. Income tax relating to items recognized directly in equity is recognized in equity and not in profit (loss) for the year.
Under the terms of the agreements, the Company receives a floating rate equal to one-month term SOFR and will make payments based on a weighted average fixed interest rate of 3.44% on the notional amount.
Under the terms of the agreements, the Company receives a floating rate equal to one-month term SOFR and will make payments based on a weighted average effective fixed interest rate of 3.44% on the notional amount.
This method is used to estimate the cost savings that accrue to the owner of an 58 intangible asset who would otherwise have to pay royalties or license fees on revenues earned through the use of the asset.
This method is used to estimate the cost savings that accrue to the owner of an intangible asset who would otherwise have to pay royalties or license fees on revenues earned through the use of the asset.
If the carrying amount of the reporting unit exceeds the calculated fair value of the reporting unit, an impairment charge would be recognized for the excess, not to exceed the amount of goodwill allocated to that reporting unit.
If the carrying amount of the reporting unit exceeds the calculated fair value of the reporting unit, an impairment charge would be recognized for the excess of carrying value over fair value, not to exceed the amount of goodwill allocated to that reporting unit.
Capex for rental equipment: Capex for rental equipment increased $72.9 million, or 160.6%, to $118.3 million for the year ended December 31, 2022 from $45.4 million for the year ended December 31, 2021 driven by a significant increase in container purchases during the year given high utilization and strong demand, as well as due to expansion of our VAPS offering in Storage.
Capex for rental equipment: Capex for rental equipment increased $72.9 million, or 160.4%, to $118.3 million for the year ended December 31, 2022 from $45.4 million for the year ended December 31, 2021 driven by a significant increase 51 in container purchases during the year given high utilization and strong demand, as well as due to expansion of our VAPS offering in Storage.
Interest Expense Interest expense consists of the costs of external debt including the Company’s ABL credit facility, 2025 Secured Notes, 2028 Secured Notes, and interest on obligations under finance leases.
Interest Expense Interest expense consists of the costs of external debt including the Company’s ABL credit facility, 2025 Secured Notes, 2028 Secured Notes, 2031 Secured Notes and interest on obligations under finance leases.
MD&A is provided as a supplement to, and should be read in conjunction with, our financial statements and the accompanying notes thereto, contained in Part II, Item 8 of this report. The discussion of results of operations in this MD&A is presented on a historical basis, as of or for the year ended December 31, 2022 or prior periods.
MD&A is provided as a supplement to, and should be read in conjunction with, our financial statements and the accompanying notes thereto, contained in Part II, Item 8 of this report. The discussion of results of operations in this MD&A is presented on a historical basis, as of or for the year ended December 31, 2023 or prior periods.
Average portable storage monthly rental rates increased 23.9% for the year ended December 31, 2022 to $192 as a result of our price management tools and processes, further supported by high utilization, and by an acceleration earlier into the third quarter of our seasonal retail business.
Average portable storage monthly rental rates increased 23.1% for the year ended December 31, 2022 to $192 as a result of our price management tools and processes, further supported by high utilization, and by an acceleration earlier into the third quarter of our seasonal retail business.
Furthermore, given that our customers value flexibility, they consistently extend their leases or renew on a month-to-month basis such that the average effective duration of our lease portfolio, excluding seasonal portable storage units, is approximately 32 months.
Furthermore, given that our customers value flexibility, they consistently extend their leases or renew on a month-to-month basis such that the average effective duration of our lease portfolio, excluding seasonal portable storage units, is approximately 37 months.
Capex for rental equipment: Capex for rental equipment increased $91.6 million, or 48.9%, to $279.1 million for the year ended December 31, 2022 from $187.5 million for the year ended December 31, 2021. The increase was mainly driven by increased spending on refurbishments and fleet and VAPS purchases.
Capex for rental equipment: Capex for rental equipment increased $91.6 million, or 48.8%, to $279.1 million for the year ended December 31, 2022 from $187.5 million for the year ended December 31, 2021. The increase was mainly driven by increased spending on refurbishments and fleet and VAPS purchases.
In total, modular space average units on rent increased 3,504 units, or 3.5%, for the year ended December 31, 2022 as compared to the year ended December 31, 2021. Modular space average monthly rental rates increased 18.3% to $913 for the year ended December 31, 2022.
In total, modular space average units on rent increased 3,504 units, or 3.5%, for the year ended December 31, 2022 as compared to the year ended December 31, 2021. Modular space average monthly rental rates increased 18.3% to $905 for the year ended December 31, 2022.
Cash flows from investing activities Cash used in investing activities for the year ended December 31, 2022 was $309.3 million as compared to $384.0 million for the year ended December 31, 2021, a decrease of $74.7 million.
Cash used in investing activities for the year ended December 31, 2022 was $309.3 million as compared to $384.0 million for the year ended December 31, 2021, a decrease of $74.7 million.
Cash flows from financing activities Cash used in financing activities for the year ended December 31, 2022 was $429.4 million as compared to $167.9 million for the year ended December 31, 2021, an increase of $261.5 million.
Cash used in financing activities for the year ended December 31, 2022 was $429.4 million as compared to $167.9 million for the year ended December 31, 2021, an increase of $261.5 million.
We remain focused on our core priorities of growing leasing revenues by increasing units on rent, both organically and through our consolidation strategy, delivering “Ready to Work” solutions to our customers with value added products and services ("VAPS"), and on continually improving the overall customer experience.
We remain focused on our core priorities of growing leasing revenues by increasing units on rent, both organically and through our acquisition strategy, delivering “Ready to Work” turnkey solutions to our customers with value added products and services ("VAPS"), and on continually improving the overall customer experience.
The increase in gross profit from leasing and delivery and installation revenues was partially offset by a $30.6 million increase in depreciation of rental equipment primarily as a result of capital investments made over the past twelve months in our existing rental equipment for the year ended December 31, 2022.
The increase in gross profit from leasing revenues was partially offset by a $30.6 million increase in depreciation of rental equipment primarily as a result of capital investments made over the past twelve months in our existing rental equipment for the year ended December 31, 2022.
Fair Value (Gain) Loss on Common Stock Warrant Liabilities Fair value (gain) loss on common stock warrant liabilities consists of non-cash gains and losses recorded related to changes in the fair value of common stock warrant liabilities as the common stock warrant liabilities are marked-to-market liabilities.
Fair Value Loss on Common Stock Warrant Liabilities In 2021, fair value loss on common stock warrant liabilities consists of non-cash gains and losses recorded related to changes in the fair value of common stock warrant liabilities as the common stock warrant liabilities are marked-to-market liabilities.
Other (Income) Expense, Net Other (income) expense, net primarily consists of the gain (loss) on disposal of non-operational property, plant and equipment, insurance proceeds, other financing related costs and other non-reoccurring charges.
Other (Income) Expense, Net Other (income) expense, net primarily consists of the gain (loss) on disposal of non-operational property, plant and equipment, insurance proceeds, other financing related costs and other non-recurring charges.
Borrowing availability under the ABL Facility is equal to the lesser of $3.7 billion and the applicable borrowing bases. The borrowing bases are a function of, among other things, the value of the assets in the relevant collateral pool of which our rental equipment represents the largest component.
Borrowing availability under the ABL Facility is equal to the lesser of $3.7 billion and the applicable borrowing bases. The borrowing bases are a function of, among other things, the value of the assets in the relevan t collateral pool of which our rental equipment represents the largest component.
Intangible Assets Other than Goodwill Intangible assets that are acquired by the Company and determined to have an indefinite useful life are not amortized but are tested for impairment at least annually. The Company’s indefinite-lived intangible assets consist of the Williams Scotsman and Mobile Mini trade names.
Indefinite-lived Intangible Assets Intangible assets that are acquired by the Company and determined to have an indefinite useful life are not amortized but are tested for impairment at least annually. The Company’s indefinite-lived intangible assets consist of the Williams Scotsman and Mobile Mini trade names.
At December 31, 2022, we had $1.0 billion of available borrowing capacity under the ABL Facility. 55 Cash Flows Significant factors driving our liquidity include cash flows generated from operating activities and capital expenditures. Our ability to fund our capital needs will be affected by our ongoing ability to generate cash from operations and access to capital markets.
At December 31, 2023, we had $1.2 billion of available borrowing capacity under the ABL Facility. 55 Cash Flows Significant factors driving our liquidity include cash flows generated from operating activities and capital expenditures. Our ability to fund our capital needs will be affected by our ongoing ability to generate cash from operations and access to capital markets.
The consolidated statements of cash flows include amounts for the former Tank and Pump segment through September 30, 2022 and the UK Storage Solutions segment through December 31, 2022. See Note 3 to the financial statements for disclosure of significant operating and investing items related to the former Tank and Pump segment and the UK Storage Solutions segment.
The consolidated statements of cash flows include amounts for the former Tank and Pump segment through September 30, 2022 and the UK Storage Solutions segment through January 31, 2023. See Note 3 to the financial statements for disclosure of significant operating and investing items related to the former Tank and Pump segment and the UK Storage Solutions segment.
We track several market leading indicators to predict demand, including those related to our two largest end markets, the commercial and industrial sector and the construction sector, which collectively accounted for approximately 88% of our revenues in the year ended December 31, 2022.
We track several market leading indicators to predict demand, including those related to our two largest end markets, the commercial and industrial sector and the construction sector, which collectively accounted for approximately 85% of our revenues in the year ended December 31, 2023.
The Company believes its cash, cash flows generated from ongoing operations, and continued access to its revolving credit facility as well as access to debt markets are sufficient to satisfy its currently anticipated cash requirements over the next twelve months.
The Company believes its cash, cash flows generated from ongoing operations, and continued access to its revolving credit facility as well as access to debt markets are sufficient to satisfy its currently anticipated cash requirements over the next twelve months and thereafter for the foreseeable future.
The Company's lease arrangements can include multiple lease and non-lease components. Examples of lease components include, but are not limited to, the lease of modular space and portable storage units and VAPS. Examples of non-lease components include, but are not limited to, the delivery, installation, maintenance, and removal services commonly provided in a bundled transaction with the lease components.
Examples of lease components include, but are not limited to, the lease of modular space and portable storage units and VAPS. Examples of non-lease components include, but are not limited to, the delivery, installation, maintenance, and removal services commonly provided in a bundled transaction with the lease components.
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help the reader understand WillScot Mobile Mini Holdings Corp. ("WillScot Mobile Mini"), formerly known as WillScot Corporation ("WillScot"), our operations and our present business environment.
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help the reader understand WillScot Mobile Mini Holdings Corp. ("WillScot Mobile Mini") operations and our present business environment.
As presented below, Net CAPEX includes amounts for the former Tank and Pump segment through September 30, 2022 and the UK Storage Solutions segment through December 31, 2022.
As presented below, Net CAPEX includes amounts for the former Tank and Pump segment through September 30, 2022 and the UK Storage Solutions segment through January 31, 2023.
The Company classifies interest on tax deficiencies and income tax penalties within income tax expense. The evaluation of uncertain tax positions involves judgment in the application of GAAP and complex tax laws. None of the critical accounting policies and estimates noted above have changed materially since the prior year. 60
The Company classifies interest on tax deficiencies and income tax penalties within income tax expense. The evaluation of uncertain tax positions involves judgment in the application of GAAP and complex tax laws. None of the critical accounting estimates or assumptions noted above have changed materially since the prior year. 59
Currency (Gains) Losses, net: Currency losses, net increased by $0.5 million to $0.9 million for the year ended December 31, 2022 compared to $0.4 million for the year ended December 31, 2021.
Currency Losses, net: Currency losses, net increased by $0.5 million to a $0.9 million loss for the year ended December 31, 2022 compared to $0.4 million for the year ended December 31, 2021.
Costs incurred for equipment to meet a particular customer specification are capitalized and depreciated over the lease term taking into consideration the residual value of the asset. Maintenance and repair costs are expensed as incurred.
Costs incurred for equipment to meet a particular customer specification are either capitalized and depreciated over the lease term taking into consideration the residual value of the asset or charged to the customer at the beginning of the lease and expensed as incurred. Maintenance and repair costs are expensed as incurred.
On July 1, 2020, in connection with the closing of the merger by which WillScot and Mobile Mini, Inc. ("Mobile Mini") were combined (the "Merger"), Mobile Mini became a wholly-owned subsidiary of WillScot and the Company changed its name to WillScot Mobile Mini Holdings Corp.
In connection with the closing of the merger of WillScot Corporation ("WillScot") and Mobile Mini, Inc. ("Mobile Mini") on July 1, 2020 (the "Merger"), Mobile Mini became a wholly-owned subsidiary of WillScot and the Company changed its name to WillScot Mobile Mini Holdings Corp.
Interest Rate Swap Agreements In January 2023, the Company entered into two interest rate swap agreements with financial counterparties relating to $750.0 million in aggregate notional amount of variable-rate debt under the ABL Facility.
In January 2024, the Company entered into two interest rate swap agreements with financial counterparties relating to $500.0 million in aggregate notional amount of variable-rate debt under the Company's ABL Facility.
Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition, results of operations, liquidity and capital resources is based on our consolidated financial statements, which have been prepared in accordance with GAAP.
Critical Accounting Estimates The Company's discussion and analysis of its financial condition, results of operations, liquidity and capital resources is based on its consolidated financial statements, which have been prepared in accordance with GAAP.
WillScot Mobile Mini is the holding company for the Williams Scotsman and Mobile Mini families of companies. On September 30, 2022, the Company completed the sale of its former Tank and Pump Solutions ("Tank and Pump") segment.
WillScot Mobile Mini is the holding company for the Williams Scotsman and Mobile Mini families of companies. On September 30, 2022, the Company completed the sale of its former Tank and Pump Solutions ("Tank and Pump") segment. On January 31, 2023, the Company completed the sale of its UK Storage Solutions segment.
Average modular space monthly rental rates increased 18.3% for the year ended December 31, 2022 to 47 $957 driven by continuation of the long-term price optimization and VAPS penetration opportunities across our portfolio. Improved pricing was aided by higher volumes as average modular space units on rent increased by 2,096 units, or 2.5%, year over year driven by acquisitions.
Average modular space monthly rental rates increased 17.8% for the year ended December 31, 2022 to $966 driven by continuation of the long-term price optimization and VAPS penetration opportunities across our portfolio. Improved pricing was aided by higher volumes as average modular space units on rent increased by 2,638 units, or 3.3%, year over year driven by acquisitions.
Depreciation is computed using the straight-line method over estimated useful lives, as follows: Estimated Useful Life Residual Value Modular space units 10 - 30 years 20 - 55% Portable storage units 30 years 55% VAPS and other related rental equipment 1 - 8 years —% Trade Receivables and Allowance for Credit Losses .
Depreciation is computed using the straight-line method over estimated useful lives, as follows: Estimated Useful Life Residual Value Modular space units 10 - 30 years 20 - 55% Portable storage units 7 - 30 years 20 - 55% VAPS and other related rental equipment 1 - 10 years 0% 58 Allowance for Credit Losses The Company is exposed to credit losses from trade receivables.
The Company is exposed to credit losses from trade receivables. The Company assesses each customer’s ability to pay for the products it leases or sells by conducting a credit review. The credit review considers expected billing exposure and timing for payment and the customer’s established credit rating.
The Company assesses each customer’s ability to pay for the products it leases or sells by conducting a credit review. The credit review considers expected billing exposure and timing for payment and the customer’s established credit rating.
Fair Value (Gain) Loss on Common Stock Warrant Liabilities: The fair value of common stock warrant liabilities decreased $30.1 million to a loss of $26.6 million for the year ended December 31, 2021. The decrease was primarily attributable to the change in estimated fair value of common stock warrant liabilities.
Fair Value Loss on Common Stock Warrant Liabilities: For the year ended year ended December 31, 2021, the fair value loss on common stock warrant liabilities of $26.6 million was primarily attributable to the change in estimated fair value of common stock warrant liabilities.
Even in an uncertain macro-economic environment, market catalysts such as increased infrastructure spending and onshoring and reshoring, and idiosyncratic growth levers such as continued penetration of our customer base with our VAPS offering, long-term pricing tailwinds, cross-selling between our Modular and Storage segment customers, and other commercial best practice sharing between our segments provide us confidence in our continued organic growth outlook. 38 Components of Our Consolidated Historical Results of Operations Revenue Our revenue consists mainly of leasing, services and sales revenue.
Even in an uncertain macro-economic environment, market catalysts such as increased infrastructure spending and onshoring and reshoring, and idiosyncratic growth levers such as continued penetration of our customer base with our VAPS offering, long-term pricing tailwinds, cross-selling between our Modular and Storage segment customers, and other commercial best practice sharing between our segments provide us confidence in our continued organic growth outlook.
GAAP requires that we make estimates and judgments that affect the reported amount of assets, liabilities, revenue, expenses and the related disclosure of contingent assets and liabilities. We base these estimates on historical experience and on various other assumptions that we consider reasonable under the circumstances and reevaluate our estimates and judgments as appropriate.
GAAP requires that management make estimates and judgments that affect the reported amount of assets, liabilities, revenue, expenses and the related disclosure of contingent assets and liabilities. The Company's management bases these estimates on historical experience and on various other assumptions that they consider reasonable under the circumstances and reevaluate their estimates and judgments as appropriate.
It also includes the leasing of facilities we occupy, professional fees and information systems, our overhead costs, such as salaries and other employee costs of management, administrative and corporate personnel, and integration costs associated with acquisitions and business combinations. Transaction Costs Transaction costs include discrete expenses incurred related to the Merger and other acquisitions.
It also includes the leasing of facilities we occupy, professional fees and information systems, our overhead costs, such as salaries and other employee costs of management, administrative and corporate personnel, and integration costs associated with acquisitions and business combinations.
The average modular space unit utilization rate during the year ended December 31, 2021 was 69.2%, as compared to 69.5% during 2020. The average portable storage unit utilization rate during the year ended December 31, 2021 was 80.1%, as compared to 74.2% during 2020.
The average modular space unit utilization rate during the year ended December 31, 2022 was 68.5%, as compared to 69.2% during 2021. The average portable storage unit utilization rate during the year ended December 31, 2022 was 86.8%, as compared to 80.1% during 2021.
The qualitative impairment test assesses company-specific, industry, market and general economic factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount.
Evaluation of Goodwill Impairment The Company performs its assessment of goodwill utilizing either a qualitative or quantitative impairment test. The qualitative impairment test assesses company-specific, industry, market and general economic factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount.
The key drivers of changes in our leasing revenue are: • the number of units in our lease fleet; • the average utilization rate of our lease units; and • the average monthly rental rate per unit, including VAPS.
The key drivers of changes in our leasing revenue are: • the average number of units on rent; • the average monthly rental rate per unit, including VAPS.
Cost of revenues associated with our leasing business includes payroll and payroll-related costs for branch operations personnel, material and other costs related to the repair, maintenance, storage and transportation of rental equipment. Cost of revenue also includes depreciation expense associated with our rental equipment.
Gross Profit We define gross profit as the difference between total revenues and cost of revenues. Cost of revenues associated with our leasing business includes payroll and payroll-related costs for branch operations personnel, material and other costs related to the repair, maintenance, storage and transportation of rental equipment. Cost of revenues also includes depreciation expense associated with our rental equipment.
Adjusted EBITDA: Adjusted EBITDA increased $128.2 million, or 56.6%, to $354.8 million for the year ended December 31, 2022 from $226.6 million for the year ended December 31, 2021. The increase was driven by higher leasing gross profits discussed above, partially offset by increases in SG&A, excluding discrete and other items of $54.1 million.
Adjusted EBITDA: Adjusted EBITDA increased $103.8 million, or 25.6%, to $508.3 million for the year ended December 31, 2022 from $404.6 million for the year ended December 31, 2021. The increase was driven by higher leasing gross profits discussed above, partially offset by increases in SG&A, excluding discrete and other items of $48.8 million.
Valuation allowances are recorded to reduce the deferred tax assets to an amount that will more likely than not be realized. 59 The Company assesses the likelihood that each of the deferred tax assets will be realized. To the extent management believes realization of any deferred tax assets is not likely, the Company establishes a valuation allowance.
The Company assesses the likelihood that each of the deferred tax assets will be realized. To the extent management believes realization of any deferred tax assets is not likely, the Company establishes a valuation allowance.
Adjusted EBITDA: Adjusted EBITDA increased $106.1 million, or 25.1%, to $529.1 million for the year ended December 31, 2022 from $423.0 million for the year ended December 31, 2021. The increase was driven by higher leasing gross profits discussed above, partially offset by increases in SG&A, excluding discrete and other items of $50.1 million.
Adjusted EBITDA: Adjusted EBITDA increased $130.5 million, or 53.3%, to $375.5 million for the year ended December 31, 2022 from $245.0 million for the year ended December 31, 2021. The increase was driven by higher leasing gross profits discussed above, partially offset by increases in SG&A, excluding discrete and other items of $55.4 million.
For the year ended December 31, 2022, key drivers of our financial performance included: • Total revenues from continuing operations increased by $469.6 million, or 28.1%, attributable to organic revenue growth levers in the business and due to the impact of acquisitions.
For the year ended December 31, 2023, key drivers of our financial performance included: • Total revenues increased $222.1 million, or 10.4%, attributable to organic revenue growth levers in the business and due to the impact of acquisitions.
The allowance for credit losses reflects the estimate of the amount of receivables that the Company will be unable to collect based on historical write-off experience and, as applicable, current conditions and reasonable and supportable forecasts that affect collectability. This estimate is sensitive to changing circumstances, including changes in the economy or in the particular circumstances of individual customers.
The allowance for credit losses reflects the estimate of the amount of receivables that the Company will be unable to collect based on historical write-off experience and, as applicable, current conditions and reasonable and supportable forecasts that affect collectability.
The following summarizes our change in cash and cash equivalents for the periods presented: Year Ended December 31, (in thousands) 2022 2021 2020 Net cash from operating activities $ 744,658 $ 539,902 $ 304,812 Net cash from investing activities (309,333) (384,047) (125,360) Net cash from financing activities (429,368) (167,887) (158,958) Effect of exchange rate changes on cash and cash equivalents (882) (206) 1398 Net change in cash and cash equivalents $ 5,075 $ (12,238) $ 21,892 Comparison of the Years Ended December 31, 2022 and 2021 and December 31, 2021 and 2020 Cash Flows from operating activities Cash provided by operating activities for the year ended December 31, 2022 was $744.7 million as compared to $539.9 million for the year ended December 31, 2021, an increase of $204.8 million, or 38%.
The following summarizes our change in cash and cash equivalents for the periods presented: Year Ended December 31, (in thousands) 2023 2022 2021 Net cash from operating activities $ 761,240 $ 744,658 $ 539,902 Net cash from investing activities (350,003) (309,333) (384,047) Net cash from financing activities (418,935) (429,368) (167,887) Effect of exchange rate changes on cash and cash equivalents 882 (882) (206) Net change in cash and cash equivalents $ (6,816) $ 5,075 $ (12,238) Comparison of the Years Ended December 31, 2023 and 2022 and December 31, 2022 and 2021 Cash Flows from operating activities Cash provided by operating activities for the year ended December 31, 2023 was $761.2 million as compared to $744.7 million for the year ended December 31, 2022, an increase of $16.6 million, or 2%.
Refer to Note 10 for further information regarding outstanding debt. Operating leases The Company has commitments for future minimum rental payments relating to operating leases, which are primarily for equipment and office space. As of December 31, 2022, the Company had lease obligations of $258.5 million, with $60.1 million payable within the next twelve months.
Refer to Note 10 for further information regarding outstanding debt. Operating leases The Company has commitments for future minimum rental payments relating to operating leases, which are primarily for real estate. As of December 31, 2023, the Company had lease obligations of $288.7 million, with $69.4 million payable within the next twelve months.
The increase in gross profit from leasing revenues was partially offset by an $11.9 million increase in depreciation of rental equipment primarily as a result of capital investments made over the past twelve months in our existing rental equipment for the year ended December 31, 2021.
The increase in gross profit from leasing and delivery and installation revenues was partially offset by a $10.6 million increase in depreciation of 50 rental equipment primarily as a result of capital investments made over the past twelve months of additional rental equipment for the year ended December 31, 2023.
Comparison of Years Ended December 31, 2021 and 2020 Revenue: Total revenue increased $400.0 million, or 31.4%, to $1,673.0 million for the year ended December 31, 2021 from $1,273.0 million for the year ended December 31, 2020.
Comparison of Years Ended December 31, 2022 and 2021 Revenue: Total revenue increased $469.6 million, or 28.1%, to $2,142.6 million for the year ended December 31, 2022 from $1,673.0 million for the year ended December 31, 2021.
The initial lease periods vary, and our leases are customarily renewable on a month-to-month basis after their initial term. Our lease revenue is highly predictable due to its reoccurring nature and the underlying stability and diversification of our lease portfolio.
Over 90% of new lease orders are on our standard lease agreement, pre-negotiated master lease or national account agreements. The initial lease periods vary, and our leases are customarily renewable on a month-to-month basis after their initial term. Our lease revenue is highly predictable due to its recurring nature and the underlying stability and diversification of our lease portfolio.
Net Income including income from discontinued operations was $339.5 million for the year ended December 31, 2022, representing an increase of $179.4 million versus the year ended December 31, 2021 . • Generated Adjusted EBITDA from continuing operations of $883.9 million for the year ended December 31, 2022, representing an increase of $234.3 million, or 36.1%, as compared to 2021.
Net Income including income from discontinued operations was $476.5 million for the year ended December 31, 2023, representing an increase of $136.9 million versus the year ended December 31, 2022 . • Generated Adjusted EBITDA from continuing operations of $1,061.5 million for the year ended December 31, 2023, representing an increase of $177.6 million, or 20.1%, as compared to 2022.
Average modular space monthly rental rates increased 21.1% for the year ended December 31, 2022 to $705 driven by the continuation of our long-term price optimization initiative and VAPS penetration opportunities across our portfolio.
Average modular space monthly rental rates increased 21.6% for the year ended December 31, 2022 to $682 driven by the continuation of our long-term price optimization initiative and VAPS penetration opportunities across our portfolio. Average modular space units on rent increased by 866 units, or 4.0%, year over year, of which approximately 1,100 was acquisition driven.
Our gross profit percentage, excluding the effects of depreciation ("adjusted gross profit percentage"), was 65.0% and 63.6% for the years ended December 31, 2022 and 2021, respectively. Gross profit increased $290.8 million, or 34.4%, to $1,135.5 million for the year ended December 31, 2022 from $844.7 million for the year ended December 31, 2021.
Our gross profit percentage, excluding the effects of depreciation ("adjusted gross profit percentage"), was 65.0% and 63.6% for the years ended December 31, 2022 and 2021, respectively. SG&A Expense: SG&A expense increased $87.0 million, or 18.1%, to $567.4 million for the year ended December 31, 2022, compared to $480.4 million for the year ended December 31, 2021.
These increases were offset partially by increased depreciation of $37.9 million as a result of acquired fleet and capital investments made over the past twelve months in our existing rental equipment.
These increases were partially offset by increased depreciation of $37.9 million as a result of acquired fleet and capital investments made over the past twelve months in our existing rental equipment. Our gross profit percentage was 53.0% and 50.5% for the years ended December 31, 2022 and 2021, respectively.
Currency (Gains) Losses, Net Currency (gains) losses, net include unrealized and realized gains and losses on monetary assets and liabilities denominated in foreign currencies other than our functional currency at the reporting date.
Other Depreciation and Amortization Other depreciation and amortization includes depreciation of our property, plant and equipment, as well as the amortization of our intangible assets. 42 Currency Losses, Net Currency losses, net includes unrealized and realized gains and losses on monetary assets and liabilities denominated in foreign currencies other than our functional currency at the reporting date.
The increase in gross profit was driven by a $161.1 million increase in leasing gross profit and an increase of $23.9 million in delivery and installation gross profit.
The increase in gross profit was driven by an $83.5 million increase in leasing gross profit and an increase of $5.7 million in delivery and installation gross profit.
Average modular space monthly utilization decreased 450 bps to 74.0% for the year ended December 31, 2022, as compared to the year ended December 31, 2021. • Generated income from continuing operations of $276.3 million for the year ended December 31, 2022, representing an increase of $161.4 million ver sus the year ended December 31, 2021.
Average modular space monthly utilization decreased 11.3% to 61.1% for the year ended December 31, 2023, as compared to the year ended December 31, 2022. • Generated income from continuing operations of $341.8 million for the year ended December 31, 2023, representing an increase of $65.5 million ver sus the year ended December 31, 2022.
Evaluation of Goodwill Impairment For acquired businesses, the Company records assets acquired and liabilities assumed at their respective estimated fair values on the date of acquisition.
Under the acquisition method of accounting, the Company records assets acquired and liabilities assumed, including intangible assets, at their respective estimated fair values on the date of acquisition.
This MD&A presents the historical financial results of the former Tank and Pump segment and the UK Storage Solutions segment as discontinued operations for all periods presented.
This MD&A presents the historical financial results of the former Tank and Pump segment and the former UK Storage Solutions segment as discontinued operations for all periods presented. The divestitures of the UK Storage Solutions segment and the former Tank and Pump segment completed the Company's transition of its portfolio to core turnkey temporary space solutions in North America.
In making such determination, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent results of operations.
In making such determination, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent results of operations. Valuation allowances are recorded to reduce the deferred tax assets to an amount that will more likely than not be realized.
The sale of the UK Storage Solutions segment closed on January 31, 2023, and we will record a gain on the sale of the UK Storage Solutions segment in the first quarter of 2023. Proceeds from these sales were used to support ongoing reinvestment in our North America Modular and Storage operating segments and other capital allocation priorities.
Divestiture On January 31, 2023, we completed the sale of our former UK Storage Solutions segment for total cash consideration of $418.1 million. Proceeds from the sale were used to support ongoing reinvestment in our Modular and Storage operating segments in North America and other capital allocation priorities.
Portable storage average units on rent increased by 63,537 units, or 88.0%, for the year ended December 31, 2021. Average portable storage monthly rental rates of $154 represented an increase of $12, or 8.5%, compared to the year ended December 31, 2020. This increase was driven by the accretive impact of higher rates from the Mobile Mini portable storage fleet.
Average portable storage monthly rental rates of $192 represented an increase of $37, or 23.9%, compared to the year ended December 31, 2021. This increase was driven by the accretive impact of higher rates from the Mobile Mini portable storage fleet.
Other (Income) Expense, Net: Other (income) expense, net was $6.7 million of income for the year ended December 31, 2022 and $1.7 million of expense for the year ended December 31, 2021, The increase in other (income) expense, net is primarily related to insurance recoveries received in 2022 related to Hurricane Ida in the Gulf Coast area of the United States in 2021.
The increase in other 47 (income) expense, net is primarily related to insurance recoveries received in 2022 related to Hurricane Ida in the Gulf Coast ares of the United States in 2021.
The increase was primarily driven by increased leasing revenue of $169.4 million, or 19.6%, compared to 2021, increased delivery and installation revenue of $60.4 million, or 27.5%, compared to 2021.
The increase was primarily driven by increased leasing revenue of $164.6 million, or 19.9%, compared to 2021, increased delivery and installation revenue of $58.9 million, or 27.6% compared to 2021 and partially offset by decreased sales revenue of $2.0 million, or 2.6%, compared to 2021.
Employee costs excluding stock compensation increased $57.6 million, or 27.3%, driven by a 13% increase in SG&A headcount to support both organic and inorganic growth, wage increases, and increased variable compensation as a result of the growth achieved. Legal and professional fees increased $23.8 million, or 45.5%.
For 2022, SG&A expense for Modular and Storage totaled $304.9 million and $215.7 million respectively. Employee costs excluding stock compensation increased $57.6 million, or 27.3%, driven by a 12% increase in SG&A headcount to support both organic and inorganic growth. Legal and professional fees increased $23.8 million, or 45.5%.
The remaining increases were primarily driven by increased economic activity and inflationary increases, including increased occupancy and office costs, insurance, travel expenses, and marketing cost increases. Transaction Costs: For the year ended December 31, 2021, transaction costs of $1.4 million were primarily related to the Merger.
The remaining increases were primarily driven by increased economic activity and inflationary increases, including increased occupancy and office costs, insurance, travel expenses, and marketing cost increases. .
Average modular space monthly rental rates increased 18.1% for the year ended December 31, 2021 to $809 driven by continuation of the long-term price optimization and VAPS penetration opportunities across our portfolio. Improved pricing was partially offset by lower volumes as average modular space units on rent decreased by 2,350 units, or 2.7%, year over year.
Average portable storage units on rent decreased by 15,159 units, or 9.0%, year over year mainly driven by lower demand. Average modular space monthly rental rates increased 21.1% for the year ended December 31, 2023 to $826 driven by the continuation of our long-term price optimization initiative and VAPS penetration opportunities across our portfolio.
The increase was primarily driven by increased leasing revenue of $199.8 million, or 51.5%, compared to 2021, and increased delivery and installation revenue of $47.6 million, or 46.8%, compared to 2021.
The increase was primarily driven by increased leasing revenue of $204.6 million, or 48.2%, compared to 2021 , and increased delivery and installation revenue of $49.1 million, or 45.7%, compared to 2021 .
The average utilization rate of our lease units is the ratio of (i) the average number of units in use during a period (which includes units from the time they are leased to a customer until the time they are returned to us) to (ii) the average total number of units available for lease in our fleet during a period.
We also measure the average utilization rate of our lease units, which is the ratio of (i) the average number of units on rent to (ii) the average total number of units available for lease in our fleet during a period.
Other (Income) Expense, Net: Other (income) expense, net was $1.7 million of expense for the year ended December 31, 2021 and $1.7 million of income for the year ended December 31, 2020, primarily related to the reversal of non-operating liabilities of $2.5 million for the year ended December 31, 2020.
Other (Income) Expense, Net: Other (income) expense, net was $6.7 million of income for the year ended December 31, 2022 and $1.7 million of expense for the year ended year ended December 31, 2021.
Years Ended December 31, 2022 vs. 2021 Change 2021 vs 2020 Change 2022 2021 2020 Revenues: Leasing and services revenue: Leasing $ 1,621,690 $ 1,252,490 $ 936,458 $ 369,200 $ 316,032 Delivery and installation 429,152 321,129 250,734 108,023 70,395 Sales revenue: New units 40,338 46,993 48,834 (6,655) (1,841) Rental units 51,443 52,368 36,965 (925) 15,403 Total revenues 2,142,623 1,672,980 1,272,991 469,643 399,989 Costs: Costs of leasing and services: Leasing 376,868 282,576 214,367 94,292 68,209 Delivery and installation 322,636 267,533 202,734 55,103 64,799 Costs of sales: New units 24,011 31,348 31,799 (7,337) (451) Rental units 26,907 28,030 23,474 (1,123) 4,556 Depreciation of rental equipment 256,719 218,790 192,190 37,929 26,600 Gross profit 1,135,482 844,703 608,427 290,779 236,276 Expenses: Selling, general and administrative 567,214 464,278 338,395 102,936 125,883 Transaction costs 25 1,375 64,053 (1,350) (62,678) Other depreciation and amortization 62,380 61,777 35,181 603 26,596 Lease impairment expense and other related charges 254 2,888 4,876 (2,634) (1,988) Restructuring costs (86) 11,866 6,109 (11,952) 5,757 Currency losses (gains), net 886 427 (257) 459 684 Other (income) expense, net (6,673) 1,715 (1,722) (8,388) 3,437 Operating income 511,482 300,377 161,792 211,105 138,585 Interest expense 146,278 116,358 119,319 29,920 (2,961) Fair value loss (gain) on common stock warrant liabilities — 26,597 (3,461) (26,597) 30,058 Loss on extinguishment of debt — 5,999 42,401 (5,999) (36,402) Income from continuing operations before income tax 365,204 151,423 3,533 213,781 147,890 Income tax expense (benefit) from continuing operations 88,863 36,528 (56,040) 52,335 92,568 Income from continuing operations 276,341 114,895 59,573 161,446 55,322 Income from continuing operations attributable to non-controlling interest, net of tax — — 1,213 — (1,213) Income from continuing operations attributable to WillScot Mobile Mini common shareholders $ 276,341 $ 114,895 $ 58,360 $ 161,446 $ 56,535 41 Cash Flow Data: Net cash from operating activities $ 744,658 $ 539,902 $ 304,812 $ 204,756 $ 235,090 Net cash from investing activities $ (309,333) $ (384,047) $ (125,360) $ 74,714 $ (258,687) Net cash from financing activities $ (429,368) $ (167,887) $ (158,958) $ (261,481) $ (8,929) Other Financial Data: Adjusted EBITDA from continuing operations (a) $ 883,874 $ 649,604 $ 494,642 $ 234,270 $ 154,962 Adjusted EBITDA from discontinued operations (a) 85,750 90,789 35,665 (5,039) 55,124 Adjusted EBITDA from continuing and discontinued operations (a) $ 969,624 $ 740,393 $ 530,307 $ 229,231 $ 210,086 Free Cash Flow (a) $ 330,334 $ 303,027 $ 162,279 $ 27,307 $ 140,748 Adjusted Gross Profit (a) $ 1,392,201 $ 1,063,493 $ 800,617 $ 328,708 $ 262,876 Net CAPEX (a) $ 414,324 $ 236,875 $ 142,533 $ 177,449 $ 94,342 Balance Sheet Data (end of year): Cash and cash equivalents $ 7,390 $ 6,393 $ 5,635 $ 997 $ 758 Rental equipment, net $ 3,077,287 $ 2,777,800 $ 2,651,720 $ 299,487 $ 126,080 Total assets $ 5,827,651 $ 5,773,599 $ 5,572,205 $ 54,052 $ 201,394 Total debt, excluding current portion $ 3,063,042 $ 2,671,831 $ 2,435,199 $ 391,211 $ 236,632 Total shareholders’ equity $ 1,565,300 $ 1,996,763 $ 2,063,873 $ (431,463) $ (67,110) (a) WillScot Mobile Mini presen ts Adjusted EBITDA, F ree Cash Flow, Adjusted Gross Profit and Net CAPEX, which are measurements not calculated in accordance with GAAP and are defined below in the section "Reconciliation of non-GAAP Financial Measures," because they are key metrics used by management to assess financial performance.
Years Ended December 31, 2023 vs. 2022 Change 2022 vs 2021 Change 2023 2022 2021 Revenues: Leasing and services revenue: Leasing $ 1,833,935 $ 1,621,690 $ 1,252,490 $ 212,245 $ 369,200 Delivery and installation 437,179 429,152 321,129 8,027 108,023 Sales revenue: New units 48,129 40,338 46,993 7,791 (6,655) Rental units 45,524 51,443 52,368 (5,919) (925) Total revenues 2,364,767 2,142,623 1,672,980 222,144 469,643 Costs: Costs of leasing and services: Leasing 398,467 376,868 282,576 21,599 94,292 Delivery and installation 317,117 322,636 267,533 (5,519) 55,103 Costs of sales: New units 26,439 24,011 31,348 2,428 (7,337) Rental units 23,141 26,907 28,030 (3,766) (1,123) Depreciation of rental equipment 265,733 256,719 218,790 9,014 37,929 Gross profit 1,333,870 1,135,482 844,703 198,388 290,779 Expenses: Selling, general and administrative 596,090 567,407 480,407 28,683 87,000 Other depreciation and amortization 72,921 62,380 61,777 10,541 603 Currency losses, net 6,754 886 427 5,868 459 Other (income) expense, net (15,354) (6,673) 1,715 (8,681) (8,388) Operating income 673,459 511,482 300,377 161,977 211,105 Interest expense 205,040 146,278 116,358 58,762 29,920 Fair value loss on common stock warrant liabilities — — 26,597 — (26,597) Loss on extinguishment of debt — — 5,999 — (5,999) Income from continuing operations before income tax 468,419 365,204 151,423 103,215 213,781 Income tax expense from continuing operations 126,575 88,863 36,528 37,712 52,335 Income from continuing operations 341,844 276,341 114,895 65,503 161,446 Discontinued operations: Income from discontinued operations before income tax 4,003 63,468 58,267 (59,465) 5,201 Income tax expense from discontinued operations 45,468 35,725 13,018 9,743 22,707 Gain on sale of discontinued operations 176,078 35,456 — 140,622 35,456 Income from discontinued operations 134,613 63,199 45,249 71,414 17,950 Net income $ 476,457 $ 339,540 $ 160,144 $ 136,917 $ 179,396 44 Cash Flow Data: Net cash from operating activities $ 761,240 $ 744,658 $ 539,902 $ 16,582 $ 204,756 Net cash from investing activities $ (350,003) $ (309,333) $ (384,047) $ (40,670) $ 74,714 Net cash from financing activities $ (418,935) $ (429,368) $ (167,887) $ 10,433 $ (261,481) Other Financial Data: Adjusted EBITDA from continuing operations (a) $ 1,061,465 $ 883,874 $ 649,604 $ 177,591 $ 234,270 Adjusted EBITDA from discontinued operations (a) 4,124 85,750 90,789 (81,626) (5,039) Adjusted EBITDA from continuing and discontinued operations (a) $ 1,065,589 $ 969,624 $ 740,393 $ 95,965 $ 229,231 Free Cash Flow (a) $ 576,589 $ 330,334 $ 303,027 $ 246,255 $ 27,307 Adjusted Gross Profit (a) $ 1,599,603 $ 1,392,201 $ 1,063,493 $ 207,402 $ 328,708 Net CAPEX (a) $ 184,651 $ 414,324 $ 236,875 $ (229,673) $ 177,449 Balance Sheet Data (end of year): Cash and cash equivalents $ 10,958 $ 7,390 $ 6,393 $ 3,568 $ 997 Rental equipment, net $ 3,381,315 $ 3,077,287 $ 2,777,800 $ 304,028 $ 299,487 Total assets $ 6,137,915 $ 5,827,651 $ 5,773,599 $ 310,264 $ 54,052 Long-term debt $ 3,538,516 $ 3,063,042 $ 2,671,831 $ 475,474 $ 391,211 Total shareholders’ equity $ 1,261,250 $ 1,565,300 $ 1,996,763 $ (304,050) $ (431,463) (a) WillScot Mobile Mini presen ts Adjusted EBITDA, F ree Cash Flow, Adjusted Gross Profit and Net CAPEX, which are measurements not calculated in accordance with GAAP and are defined below in the section "Reconciliation of non-GAAP Financial Measures," because they are key metrics used by management to assess financial performance.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

6 edited+2 added−0 removed7 unchanged
Biggest changeAn increase in interest rates by 100 basis points on our ABL Facility would have increased annual interest expense by approximately $16.3 million based on borrowings during 2022. To manage interest rate risk, in January 2023, we executed interest rate swap agreements relating to an aggregate of $750.0 million in notional amount of variable-rate debt under our ABL Facility.
Biggest changeTo manage interest rate risk, we maintain interest rate swap agreements that effectively convert $750.0 million in aggregate notional amount of variable-rate debt under our ABL Facility into fixed rate debt.
However, given our scale and our strong rate performance, we believe we have been able to navigate the inflationary environment well and have consistently driven margin improvements during this period of rising costs. Therefore, we do not believe that inflation has had a material effect on our results of operations. 61
However, given our scale and our strong rate performance, we believe we have been able to navigate the inflationary environment well and have consistently driven margin improvements during this period of rising costs. Therefore, we do not believe that inflation has had a material effect on our results of operations. 60
We evaluate and manage exposure to these market risks as follows: Interest Rate Risk We are primarily exposed to interest rate risk through our ABL Facility, which bears interest at variable rates. We had $2.0 billion in outstanding principal under the ABL Facility at December 31, 2022 .
We evaluate and manage exposure to these market risks as follows: Interest Rate Risk We are primarily exposed to interest rate risk through our ABL Facility, which bears interest at variable rates. We had $2.0 billion in outstanding principal under the ABL Facility at December 31, 2023 .
The swap agreements were designated and qualified as hedges of the Company's exposure to changes in interest payment cash flows created by fluctuations in variable interest rates on our ABL Facility.
The swap agreements were designated and qualified as hedges of our exposure to changes in interest payment cash flows created by fluctuations in variable interest rates on the ABL Facility. The swap agreements terminate on June 30, 2027.
Foreign Currency Risk We currently generate approximately 93% of our consolidated net revenues in the US, and the reporting currency for our consolidated financial statements is the US dollar. However, we are exposed to currency risk through our operations in Canada and Mexico.
Foreign Currency Risk In 2023, we generated approximately 94% of our consolidated net revenues in the US, and the reporting currency for our consolidated financial statements is the US dollar. However, we are exposed to currency risk through our operations in Canada and Mexico.
After consideration of the swaps, an increase in interest rates by 100 basis points on our ABL Facility would have increased annual interest expense by approximately $12.7 million based on outstanding borrowings at December 31, 2022.
After taking into account the impact of the swaps, an increase in interest rates by 100 basis points on our ABL Facility would have increased annual interest expense by approximately $12.1 million based on outstanding borrowings at December 31, 2023 .
Added
In January 2024, we entered into two interest rate swap agreements with financial counterparties relating to $500.0 million in aggregate notional amount of variable-rate debt under our ABL Facility.
Added
Under the terms of the agreements, we receive a floating rate equal to one-month term SOFR and will make payments based on a weighted average fixed interest rate of 3.70% on the notional amount.

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