22.10.2008

Essex Crane reports strong third quarter

Essex Crane, the Chicago, USA, based crawler crane rental company, that is in the process of being acquired by Hyde Park Acquisition company has reported a 42 percent increase in operating income for the nine months to the end of September.

Hyde Park has also said that it is expecting to receive shareholders approval for the takeover on October 30th, after which it plans to change its name to Essex Rental Corp and seek a NASDAQ listing.

The company has not released revenue figures, focusing instead on EBITDA improvements. All of which increased by around 40 percent. Profit before interest and tax for the nine month period was $28.4 million up from $20 million in 2007, an increase of 42 percent.

The results included sales of used rental equipment of $6.7 million on which the company made a net profit of $3.5 million. Used equipment sales were below last years levels, but the net profits from used equipment were similar.

The company says that the growth in profitability is “driven by strong utilisation rates for Essex’s fleet and increasing average monthly crane rental rates, the latter resulting from a mix shift towards higher lift capacity equipment and same crane class rental rate increases on a year over year basis.”

For the quarter ended September 30, 2008 average monthly crane rental rates increased by 34.4 percent to $22,258 versus $16,563 for the same quarter last year.

Laurence S. Levy, chairman and chief executive of Hyde Park, said: “As we proceed toward completing our acquisition of Essex, we are pleased to report that Essex’s operating performance continues to exceed the March 2008 projections that the transaction value was predicated on.”

“Essex’s contractual backlog and new bookings continue to be strong, particularly for its large capacity crawler cranes. This demand continues to support high utilisation and pricing above our forecasts for cranes with capacities above 200 tons.

“Moreover, we are pleased to report that the current uncertainty in the credit markets has not had an impact on our fully committed debt facility, which will enable Hyde Park to both close the Essex acquisition, and provide sufficient liquidity for future growth and investment.”