Press Release: Custom Truck One Source, Inc. Reports First Quarter 2026 Results and Increases Adjusted EBITDA 2026 Guidance

Dow Jones
Apr 28
KANSAS CITY, Mo.--(BUSINESS WIRE)--April 27, 2026-- 

Custom Truck One Source, Inc. (NYSE: CTOS), a leading provider of specialty equipment to the electric utility, telecom, rail, forestry, waste management and other infrastructure-related end markets, today reported financial results for the three months ended March 31, 2026.

CTOS First-Quarter Highlights

   --  Record first quarter revenue of $461.6 million, an increase of $39.4 
      million, or 9.3%, compared to the first quarter of 2025 
 
   --  Increased Average OEC on rent by $141.4 million, or 11.8%, compared to 
      the first quarter of 2025 
 
   --  Gross profit of $103.1 million, an increase of $17.5 million, or 20.5%, 
      compared to the first quarter of 2025 
 
   --  Adjusted Gross Profit of $159.3 million, an increase of $23.6 million, 
      or 17.4%, compared to the first quarter of 2025 
 
   --  Net loss of $4.1 million, an improvement of $13.7 million, or 76.9%, 
      compared to the first quarter of 2025 
 
   --  Adjusted EBITDA of $98.0 million, an increase of $24.6 million, or 
      33.4%, compared to the first quarter of 2025 
 
   --  Given strong conditions in the transmission and distribution ("T&D") 
      end markets, increasing 2026 full year Adjusted EBITDA1 guidance range 
      from $410M - $435M to $415M - $440M 

"In the first quarter, we achieved record first-quarter revenue and delivered substantial year-over-year growth in revenue and Adjusted EBITDA of 9% and 33%, respectively. The sustained performance in our core T&D markets continues to be the primary driver of performance within our SER segment and for the Company as a whole. For the quarter, our rental fleet achieved average utilization of 81.4%, up 370 basis points versus the first quarter of last year. We ended the quarter with total OEC of $1.66 billion, the highest in our history, which should support our expected growth within SER in 2026," said Ryan McMonagle, Chief Executive Officer of CTOS. "Our STEM segment also had a strong quarter, delivering revenue of $268 million, which excludes $95 million of sales to our SER segment. Our strong performance in the quarter allowed us to make substantial progress in reducing our net leverage, down almost 30 basis points versus the end of the previous quarter. We continue to be optimistic about the remainder of 2026, as CTOS remains well-positioned to benefit from secular tailwinds driven by data center investments, electrification, utility grid upgrades and infrastructure investment. For 2026, we remain focused on Adjusted EBITDA growth, working capital management, free cash flow generation and continued deleveraging," McMonagle added.

Summary Actual Consolidated Financial Results

 
                    Three Months Ended March 31, 
                ------------------------------------  --- 
                                                      Three Months Ended 
(in $000s)             2026                 2025       December 31, 2025 
                    -----------          ----------   ------------------ 
Rental revenue   $      137,215       $     116,261     $        141,981 
Equipment 
 sales                  292,634             273,863              353,925 
Parts sales 
 and services            31,773              32,108               32,278 
                    -----------          ----------   ---  ------------- 
   Total 
    revenue             461,622             422,232              528,184 
                    -----------          ----------   ---  ------------- 
Gross Profit     $      103,063       $      85,536     $        123,061 
Adjusted Gross 
 Profit(1)       $      159,260       $     135,627     $        179,823 
Net Income 
 (Loss)          $       (4,102)      $     (17,791)    $         20,875 
Adjusted 
 EBITDA(1)       $       97,986       $      73,426     $        120,741 
 
 
1    Each of Adjusted Gross Profit and Adjusted EBITDA is a non-GAAP measure. 
     Further information and reconciliations for our non-GAAP measures to the 
     most directly comparable financial measure under United States generally 
     accepted accounting principles ("GAAP") are included at the end of this 
     press release. CTOS is unable to present a quantitative reconciliation of 
     its forward-looking Adjusted EBITDA for the year ending December 31, 2026 
     to its most directly comparable GAAP financial measure due to the high 
     variability and difficulty in predicting certain items that affect 
     Adjusted EBITDA including, but not limited to, customer buyout requests 
     on rentals with rental purchase options and income tax expense. Adjusted 
     EBITDA should not be used to predict Net income (loss) as the difference 
     between the measures are variable and unpredictable. 
 

Summary Actual Financial Results by Segment

Beginning January 1, 2026, CTOS is reporting our results under two reportable segments: (1) Specialty Equipment Rentals ("SER") and (2) Specialty Truck Equipment and Manufacturing ("STEM"). The new SER segment consists of our historical Equipment Rental Solutions ("ERS") segment (except for certain used sales to be accounted for by STEM) and a portion of our historical Aftermarket Parts and Services ("APS") segment, and the new STEM segment will consist of our historical Truck and Equipment Sales ("TES") segment, certain used sales that previously were accounted for by ERS and a portion of our historical APS segment. We are also reflecting intercompany activity between the two segments, which is ultimately eliminated in consolidation. This new segment reporting reflects how CTOS's business is managed and how resources are allocated in 2026 and utilizes Adjusted EBITDA as the segments' profit measure. Segment Adjusted EBITDA is defined as segment operating income or loss before depreciation and amortization, further excluding the effects of purchase accounting adjustments and the impact of sales-type lease accounting for certain leases containing rental purchase options (or "RPOs").

Management believes this new presentation better reflects the positioning of CTOS's strategies and operations portfolio and better reflects key economic drivers, capital intensity, and margin profiles of the respective new segments, as well as aligns our external reporting with how management allocates capital and evaluates performance. Prior period amounts have been recast to reflect the change to two reportable segments.

Specialty Equipment Rentals

 
                                      Three Months Ended 
                     ----------------------------------------------------- 
(in $000s)           March 31, 2026    March 31, 2025   December 31, 2025 
                     ---------------  ----------------  ------------------ 
Revenue from 
external 
customers: 
   Rental             $      137,215   $       116,261   $      141,981 
   Equipment sales            37,777            29,855           55,773 
   Parts sales and 
    services                  18,771            20,965           20,982 
                         -----------      ------------      ----------- 
Total revenue from 
 external 
 customers                   193,763           167,081          218,736 
   Intersegment 
    sales                      6,790            11,600           10,489 
   Rental AR 
    Provision(1)               2,176             1,845            2,070 
   Sales type lease 
    adjustment(2)              2,103             1,257             (853) 
                         -----------      ------------      ----------- 
Total Segment 
 Revenue                     204,832           181,783          230,442 
Segment Expenses: 
Cost of rental, 
 excluding 
 depreciation                 30,748            30,092           29,921 
   Cost of 
    equipment 
    sales, net of 
    purchase 
    accounting, 
    sales-type 
    leases and 
    depreciation(3)           28,472            17,926           35,407 
   Cost of parts 
    and services, 
    excluding 
    depreciation              17,968            19,977           17,128 
   Cost of 
    intersegment 
    sales                      6,110            11,600           10,489 
   Rental AR 
    provision(1)               2,176             1,845            2,070 
                         -----------      ------------      ----------- 
Total segment cost 
 of revenue 
 expenses                     85,474            81,440           95,015 
                         -----------      ------------      ----------- 
   Selling, general 
    and 
    administrative 
    expenses                  13,861            14,294           15,100 
                         -----------      ------------      ----------- 
Total segment 
 expenses                     99,335            95,734          110,115 
                         -----------      ------------      ----------- 
Adjusted EBITDA       $      105,497   $        86,049   $      120,327 
                         ===========      ============      =========== 
 
 
1    Specifically identifiable lease revenue receivables not deemed probable 
     of collection are recorded as a reduction of rental revenue. This is 
     classified as a segment expense for Segment Adjusted EBITDA reviewed by 
     the chief operating decision maker. 
2    Impact of sales-type lease accounting for certain leases containing RPOs: 
     this impact is excluded from the measure of Adjusted EBITDA utilized by 
     our CODM to allocate resources and to assess the performance of our 
     segments as we believe continuing to reflect the transactions as an 
     operating lease better reflects the economics of the transactions given 
     our large portfolio of rental contracts. 
3    Excludes the non-cash impact of purchase accounting, impact of sales-type 
     lease accounting for certain leases containing RPOs, further excluding 
     depreciation. 
 

Specialty Truck Equipment & Manufacturing

 
                                      Three Months Ended 
                     ----------------------------------------------------- 
(in $000s)            March 31, 2026    March 31, 2025   December 31, 2025 
                     ----------------  ----------------  ----------------- 
Revenue from 
external 
customers: 
   Equipment sales    $       254,857   $       244,008    $       298,153 
   Parts sales and 
    services                   13,002            11,143             11,296 
                         ------------      ------------  ---  ------------ 
Total revenue from 
 external 
 customers                    267,859           255,151            309,449 
   Intersegment 
    sales                      95,450            94,789             89,033 
                         ------------      ------------  ---  ------------ 
Total Segment 
 Revenue                      363,309           349,940            398,482 
                         ------------      ------------  ---  ------------ 
Segment Expenses: 
   Cost of 
    equipment 
    sales, net of 
    purchase 
    accounting and 
    depreciation(1)           213,225           205,449            249,900 
   Cost of parts 
    and services, 
    excluding 
    depreciation                9,094             7,444              8,926 
   Cost of 
    intersegment 
    sales                      80,185            94,789             89,033 
                         ------------      ------------  ---  ------------ 
Total segment cost 
 of revenue 
 expenses                     302,504           307,682            347,859 
                         ------------      ------------  ---  ------------ 
   Selling, general 
    and 
    administrative 
    expenses                   17,580            15,853             18,301 
   Floorplan 
    interest 
    expense                    10,519            13,297             11,891 
                         ------------      ------------  ---  ------------ 
Total segment 
 expenses                     330,603           336,832            378,051 
                         ------------      ------------  ---  ------------ 
Adjusted EBITDA       $        32,706   $        13,108    $        20,431 
                         ============      ============  ===  ============ 
 
 
1    Excludes the non-cash impact of purchase accounting. 
 

Consolidated Adjusted EBITDA

 
                                    Three Months Ended 
                    -------------------------------------------------- 
                                                        December 31, 
(in $000s)          March 31, 2026   March 31, 2025         2025 
                    ---------------  ---------------  ---------------- 
SER Adjusted 
 EBITDA              $     105,497    $      86,049    $    120,327 
STEM Adjusted 
 EBITDA                     32,706           13,108          20,431 
Eliminations 
 Adjusted EBITDA           (15,945)              --              -- 
                        ----------       ----------       --------- 
Segment Adjusted 
 EBITDA                    122,258           99,157         140,758 
                        ----------       ----------       --------- 
Reconciling Items: 
   Corporate and 
    non-allocated 
    selling, 
    general and 
    administrative 
    expenses               (24,272)         (25,731)        (20,017) 
                        ----------       ----------       --------- 
Adjusted EBITDA      $      97,986    $      73,426    $    120,741 
                        ==========       ==========       ========= 
 

See the Company's Quarterly Report on Form 10-Q for the three months ended March 31, 2026 for a reconciliation of segment-level adjusted EBITDA to Consolidated income (loss) before income taxes.

Summary Combined Operating Metrics

 
                    Three Months Ended March 31, 
                 ----------------------------------- 
                                                      Three Months Ended 
(in $000s)              2026             2025          December 31, 2025 
                     ----------       ----------      ------------------ 
Ending OEC(a) 
 (as of period 
 end)             $   1,655,414      $ 1,548,210       $  1,637,115 
Average OEC on 
 rent(b)          $   1,343,712      $ 1,202,285       $  1,377,027 
Fleet 
 utilization(c)            81.4%            77.7%              83.6% 
OEC on rent 
 yield(d)                  38.9%            38.5%              38.7% 
Sales order 
 backlog(e) (as 
 of period 
 end)             $     411,311      $   420,149       $    335,265 
 
 
(a)    Ending OEC -- Ending original equipment cost ("OEC") is the original 
       equipment cost of units at the end of the measurement period. 
(b)    Average OEC on rent -- Average OEC on rent is calculated as the 
       weighted-average OEC on rent during the stated period. 
(c)    Fleet utilization -- total number of days the rental equipment was 
       rented during a specified period of time divided by the total number of 
       days available during the same period and weighted based on OEC. 
(d)    OEC on rent yield ("ORY") -- a measure of return realized by our rental 
       fleet during a period. ORY is calculated as rental revenue (excluding 
       freight recovery and ancillary fees) during the stated period divided 
       by the Average OEC on rent for the same period. For periods of less 
       than 12 months, the ORY is adjusted to an annualized basis. 
(e)    Sales order backlog -- purchase orders received for customized and 
       stock equipment. Sales order backlog should not be considered an 
       accurate measure of future net sales. 
 

Management Commentary

The increase of 18% in rental revenue in the first quarter of 2026 compared to the first quarter of 2025 was the result of improved average fleet utilization (which increased to 81.4% compared to 77.7%) driven by increased rental volume, with average OEC on rent increasing by 12% year-over-year. Compared to the first quarter of 2025, SER rental equipment sales increased 26.5% in the first quarter of 2026 due to an increase in buyout activity of rental contracts with purchase options. SER adjusted EBITDA in the first quarter of 2026 increased 24% compared to the first quarter of 2025.

Equipment sales in our STEM segment increased 4.4% in the first quarter of 2026 compared to the first quarter of 2025 driven by demand for forestry vehicles. Adjusted EBITDA increased by $19.8 million in the first quarter of 2026 compared to the first quarter of 2025. Our STEM backlog was down 2% compared to the first quarter of 2025, and remains within our expected range of four to six months.

The decrease in net loss in the first quarter of 2026 compared to the first quarter of 2025 was primarily due to higher operating income as a result of higher rental revenue driven by higher average OEC on rent as well as strong new equipment sales.

Adjusted EBITDA for the first quarter of 2026 was $98.0 million, a 33.4% increase compared to the first quarter of 2025, which was largely driven by increased gross profit and lower interest expense on variable-rate floor plan liabilities from lower inventory levels.

As of March 31, 2026, cash and cash equivalents were $9.6 million, total debt outstanding was $1,648.5 million, net debt was $1,638.9 million and our net leverage ratio was 4.02x. Availability under the senior secured credit facility was $256.9 million as of March 31, 2026, and based on our borrowing base, we have an additional $191.6 million of suppressed availability that we can potentially utilize by upsizing our existing facility.

2026 Outlook

We are reaffirming our full year consolidated revenue for 2026 and increasing our Adjusted EBITDA(1, 4) guidance to reflect our strong first quarter and continued momentum in the rental business.

Consolidated CTOS:

   --  Revenue is expected to increase 3% to 9% year-over-year, with Adjusted 
      EBITDA1, 4 expected to increase 8% to 15% 
 
   --  Net rental fleet investment (purchases less proceeds) for 2026 is 
      expected to be approximately $150 million to $170 million, with 
      mid-single digit net OEC growth, reflecting a meaningful reduction from 
      over $250 million in 2025 
 
   --  Inventory months on hand is expected to continue trending toward the 
      targeted level of below six months, supporting working capital 
      improvement; and 
 
   --  Levered free cash flow2, 4 is expected to exceed $50 million for 2026 
      and net leverage ratio3, 4 is expected to be meaningfully below four 
      times by the end of fiscal 2026; the longer-term target remains achieving 
      a net leverage ratio3, 4 below three times in 2027. 

Specialty Equipment Rentals $(SER)$:

   --  The rental business continues to perform very strong with OEC on rent, 
      utilization and gross margin all continuing to perform ahead of 
      expectations in 2026 
 
   --  Demand for equipment serving the utility transmission and distribution 
      market remains very strong and at record levels, and further penetration 
      of the vocational rental market is expected to provide incremental 
      growth 
 
   --  Average fleet age ended 2025 at just over 2.9 years, which positioned 
      the Company to reduce rental fleet investment while continuing to pursue 
      growth, with OEC expected to increase by a mid-single digit percentage in 
      2026. Average fleet age at the end of the first quarter was just under 3 
      years, aging slightly. 

Specialty Truck Equipment & Manufacturing $(STEM)$:

   --  Third-party new sales revenue is expected to increase 3% to 10% in 2026 
      compared to 2025, supported by continued customer demand, stable supply 
      chain conditions and relationships with key customers, chassis suppliers 
      and attachment suppliers 
 
   --  Total STEM revenue is expected to be down modestly to flat 
      year-over-year due solely to lower intercompany rental sales/capex 
 
   --  Sales order backlog increased by over $55 million (nearly 20%) in the 
      fourth quarter of 2025 and a further $76 million (nearly 23%) in the 
      first quarter of 2026, currently sitting at 4.5 months LTM third-party 
      new sales and remains within the targeted range of four to six months 

"Looking ahead, our focus in 2026 is on disciplined execution -- translating strong end-market demand into profitable growth, free cash flow generation, and further balance sheet improvement. Our rental business continues to perform very strong, driven by demand in our utility transmission and distribution markets, and we are seeing the benefit of that strength flow through to margins and Adjusted EBITDA(1, 4) . We expect to show flat revenue and single digit year-over-year Adjusted EBITDA(1, 4) growth in the second quarter. With a younger, highly utilized fleet and improving working capital dynamics, we believe CTOS is positioned to drive higher returns on invested capital while maintaining financial flexibility as we invest selectively to support our customers' long-term needs, and to translate that into meaningful free cash flow generation," said Chris Eperjesy, Chief Financial Officer of CTOS.

 
2026 Consolidated Outlook 
Revenue                     $2,005 million  --   $2,120 million 
Adjusted EBITDA(1, 4)         $415 million  --   $440 million 
 
2026 Revenue Outlook by Segment (5) 
SER                           $835 million  --   $870 million 
STEM                        $1,580 million  --   $1,655 million 
 
 
1    Adjusted EBITDA is a non-GAAP performance measure that we use to monitor 
     our results of operations, to measure performance against debt covenants 
     and performance relative to competitors. Refer to the section below 
     entitled "Non-GAAP Financial and Performance Measures" for further 
     information about Adjusted EBITDA. 
2    Levered Free Cash Flow is defined as net cash provided by operating 
     activities, less cash flow for investing activities, excluding 
     acquisitions, plus acquisition of inventory through floor plan payables 
     -- non-trade less repayment of floor plan payables -- non-trade, both of 
     which are included in cash flow from financing activities in our 
     Consolidated Statements of Cash Flows. 
3    Net leverage ratio is a non-GAAP performance measure used by management, 
     and we believe it provides useful information to investors because it is 
     an important measure to evaluate our debt levels and progress toward 
     leverage targets, which is consistent with the manner our lenders and 
     management use this measure. Refer to the section below entitled 
     "Non-GAAP Financial and Performance Measures" for further information 
     about net leverage ratio. 
4    CTOS is unable to present a quantitative reconciliation of its 
     forward-looking Adjusted EBITDA, Levered Free Cash Flow, and Net Leverage 
     Ratio for future periods to their respective most directly comparable 
     GAAP financial measure due to the high variability and difficulty in 
     predicting certain items that affect such GAAP measures including, but 
     not limited to, customer buyout requests on rentals with rental purchase 
     options and income tax expense. Adjusted EBITDA, Levered Free Cash Flow, 
     and Net Leverage Ratio should not be used to predict their respective 
     most directly comparable GAAP measure as the differences between the 
     respective measures are variable and unpredictable. 
5    Beginning January 1, 2026, transactions between segments are accounted 
     for as if completed on an arm's length basis using a cost-plus 
     methodology. 
 

CONFERENCE CALL INFORMATION

The Company has scheduled a conference call to discuss its first quarter 2026 results at 9:00 a.m. ET on April 28, 2026, via a live audio-only webcast. Both the webcast link and a presentation of financial information will be posted on the "Events & Presentations" page of investors.customtruck.com. A replay of the call will be available by accessing the same webcast link detailed above.

ABOUT CTOS

CTOS is one of the largest providers of specialty equipment, parts, tools, accessories and services to the electric utility transmission and distribution, telecommunications, and rail markets in North America, with a differentiated "one-stop-shop" business model. CTOS offers its specialized equipment to a diverse customer base for the maintenance, repair, upgrade, and installation of critical infrastructure assets, including electric lines, telecommunications networks, and rail systems. The Company's coast-to-coast rental fleet of more than 10,350 units includes aerial devices, boom trucks, cranes, digger derricks, pressure drills, stringing gear, hi-rail equipment, repair parts, tools, and accessories. For more information, please visit customtruck.com.

Investors and others should note that we announce material financial and operational information to our investors using our investor relations website (investors.customtruck.com) in addition to press releases, SEC filings and public conference calls. The information we post through our investor relations website may be deemed material. Accordingly, investors should monitor our investor relations website in addition to following our press releases, SEC filings and public conference calls.

FORWARD-LOOKING STATEMENTS

This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995, as amended, and within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. When used in this press release, the words "estimates," "projected," "expects, " "anticipates," "forecasts," "suggests," "plans," "targets," "intends," "believes," "seeks," "may," "will," "should," "future," "propose," "could," "would," and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company's management's control, that could cause actual results or outcomes to differ materially from those discussed in this press release. This press release is based on certain assumptions that the Company's management has made in light of its experience in the industry, as well as the Company's perceptions of historical trends, current conditions, expected future developments and other factors the Company believes are appropriate in these circumstances and at such time. As you read and consider this press release, you should understand that these statements are not guarantees of performance or results. Many factors could affect the Company's actual performance and results and could cause actual results to differ materially from those expressed in this press release. Important factors, among others, that may affect actual results or outcomes include: increases in labor costs, changes in U.S. trade policy including tariffs, our inability to obtain raw materials, component parts and/or finished goods in a timely and cost-effective manner, and our inability to manage our rental equipment in an effective manner; competition in the equipment dealership and rental industries; our sales order backlog may not be indicative of the level of our future revenues; increases in unionization rate in our workforce; our inability to attract and retain key personnel, including our management and skilled technicians; material disruptions to our operation and manufacturing locations as a result of public health concerns, equipment failures, natural disasters, work stoppages, power outages or other reasons; any further increase in the cost of new equipment that we purchase for use in our rental fleet or for sale as inventory aging or obsolescence of our existing equipment, and the fluctuations of market value thereof; disruptions in our supply chain; our business may be impacted by government spending; we may experience losses in excess of our recorded reserves for receivables; uncertainty relating to macroeconomic conditions, unfavorable conditions in the capital and credit markets and our customers' inability to obtain additional capital as required; increases in price of fuel or freight; regulatory, technological advancement, or other changes in our core end-markets may affect our customers' spending; our strategic initiatives including acquisitions and divestitures may not be successful and may divert our management's attention away from operations and could create general customer uncertainty; the interest of our majority stockholder, which may not be consistent with the other stockholders; volatility of our common stock market price; our significant indebtedness, which may adversely affect our financial position, limit our available cash and our access to additional capital, prevent us from growing our business and increase our risk of default; our inability to generate cash, which could lead to a default; significant operating and financial restrictions imposed by our debt agreements; changes in interest rates, which could increase our debt service obligations on the variable rate indebtedness and decrease our net income and cash flows; disruptions or security compromises affecting our information technology systems or those of our

critical services providers could adversely affect our operating results by subjecting us to liability, and limiting our ability to effectively monitor and control our operations, adjust to changing market conditions, or implement strategic initiatives; we are subject to complex laws and regulations, including environmental and safety regulations that can adversely affect cost, manner or feasibility of doing business; we are subject to a series of risks related to climate change; and increased attention to, and evolving expectations for, sustainability and environmental, social and governance initiatives. For a more complete description of these and other possible risks and uncertainties, please refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2025, and its subsequent reports filed with the Securities and Exchange Commission. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the foregoing cautionary statements.

 
 
CUSTOM TRUCK ONE SOURCE, INC. 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS 
 (unaudited) 
 
                      Three Months Ended March 31, 
                    --------------------------------- 
                                                         Three Months 
(in $000s except                                        Ended December 
per share data)           2026               2025          31, 2025 
                        ---------          ---------   ----------------- 
Revenue 
   Rental revenue    $    137,215       $    116,261    $    141,981 
   Equipment sales        292,634            273,863         353,925 
   Parts sales and 
    services               31,773             32,108          32,278 
                        ---------          ---------       --------- 
      Total 
       revenue            461,622            422,232         528,184 
                        ---------          ---------       --------- 
Cost of Revenue 
   Cost of rental 
    revenue                31,065             30,400          30,228 
   Depreciation of 
    rental 
    equipment              56,197             50,091          56,762 
   Cost of 
    equipment 
    sales                 243,918            228,477         291,772 
   Cost of parts 
    sales and 
    services               27,379             27,728          26,361 
                        ---------          ---------       --------- 
      Total cost 
       of revenue         358,559            336,696         405,123 
                        ---------          ---------       --------- 
Gross Profit              103,063             85,536         123,061 
Operating Expenses 
   Selling, 
    general and 
    administrative 
    expenses               57,626             59,451          56,603 
   Amortization             6,686              6,680           6,682 
   Non-rental 
    depreciation            3,390              3,340           3,368 
   Transaction 
    expenses and 
    other                   3,892              3,660           4,430 
                        ---------          ---------       --------- 
      Total 
       operating 
       expenses            71,594             73,131          71,083 
                        ---------          ---------       --------- 
Operating Income           31,469             12,405          51,978 
Other Expense 
   Interest 
    expense, net           35,037             38,913          38,255 
   Financing and 
    other expense 
    (income)                  237             (1,016)         (1,285) 
                        ---------          ---------       --------- 
      Total other 
       expense             35,274             37,897          36,970 
                        ---------          ---------       --------- 
Income (Loss) 
 Before Income 
 Taxes                     (3,805)           (25,492)         15,008 
Income Tax Expense 
 (Benefit)                    297             (7,701)         (5,867) 
                        ---------          ---------       --------- 
Net Income (Loss)    $     (4,102)      $    (17,791)   $     20,875 
                        =========          =========       ========= 
 
Net Income (Loss) 
Per Share 
Basic                $      (0.02)      $      (0.08)   $       0.09 
                        =========          =========       ========= 
Diluted              $      (0.02)      $      (0.08)   $       0.09 
                        =========          =========       ========= 
 
 
 
CUSTOM TRUCK ONE SOURCE, INC. 
 CONDENSED CONSOLIDATED BALANCE SHEETS 
 (unaudited) 
 
(in $000s)                          March 31, 2026     December 31, 2025 
                                   ----------------  --------------------- 
Assets 
Current Assets 
   Cash and cash equivalents        $        9,608    $           6,273 
   Accounts receivable, net                203,623              195,541 
   Financing receivables, net                6,076                8,853 
   Inventory                             1,022,471              930,939 
   Prepaid expenses and other               20,455               17,009 
                                       -----------       -------------- 
      Total current assets               1,262,233            1,158,615 
Property and equipment, net                150,491              142,526 
Rental equipment, net                    1,088,517            1,086,678 
Goodwill                                   705,058              705,167 
Intangible assets, net                     218,966              225,725 
Operating lease assets                     110,897              110,921 
Other assets                                11,144               11,822 
                                       -----------       -------------- 
Total Assets                        $    3,547,306    $       3,441,454 
                                       ===========       ============== 
Liabilities and Stockholders' 
Equity 
Current Liabilities 
   Accounts payable                 $      125,351    $          88,366 
   Accrued expenses                         77,372               69,228 
   Deferred revenue and customer 
    deposits                                15,873               23,500 
   Floor plan payables - trade             323,028              291,215 
   Floor plan payables - 
    non-trade                              417,054              366,208 
   Operating lease liabilities - 
    current                                  8,999                8,955 
   Current maturities of 
    long-term debt                           5,085               25,858 
                                       -----------       -------------- 
      Total current liabilities            972,762              873,330 
Long-term debt, net                      1,628,943            1,619,352 
Operating lease liabilities - 
 noncurrent                                106,294              105,909 
Deferred income taxes                       34,066               33,760 
                                       -----------       -------------- 
   Total long-term liabilities           1,769,303            1,759,021 
Stockholders' Equity 
Common stock                                    25                   25 
Treasury stock, at cost                   (122,602)            (122,602) 
Additional paid-in capital               1,561,053            1,559,874 
Accumulated other comprehensive 
 loss                                      (11,553)             (10,614) 
Accumulated deficit                       (621,682)            (617,580) 
                                       -----------       -------------- 
      Total stockholders' equity           805,241              809,103 
                                       -----------       -------------- 
Total Liabilities and 
 Stockholders' Equity               $    3,547,306    $       3,441,454 
                                       ===========       ============== 
 
 
 
CUSTOM TRUCK ONE SOURCE, INC. 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
 (unaudited) 
 
                                          Three Months Ended March 31, 
                                      ------------------------------------ 
(in $000s)                                   2026              2025 
                                          -----------       ----------- 
Operating Activities 
Net loss                               $       (4,102)     $    (17,791) 
Adjustments to reconcile net income 
(loss) to net cash flow from 
operating activities: 
   Depreciation and amortization               68,210            62,137 
   Amortization of debt issuance 
    costs                                       1,089             1,064 
   Provision for losses on accounts 
    receivable                                  2,445             2,030 
   Share-based compensation                     1,179             2,404 
   Gain on sales and disposals of 
    rental equipment                           (9,882)           (9,986) 
   Deferred tax expense (benefit)                 388            (8,119) 
Changes in assets and liabilities: 
   Accounts and financing 
    receivables                                (6,501)            9,132 
   Inventories                                (92,595)          (26,306) 
   Prepaids, operating leases and 
    other                                      (3,060)           (4,756) 
   Accounts payable                            34,286            35,230 
   Accrued expenses and other 
    liabilities                                 8,145            11,405 
   Floor plan payables - trade, net            31,813             4,421 
   Customer deposits and deferred 
    revenue                                    (7,600)           (5,230) 
                                          -----------       ----------- 
      Net cash flow from operating 
       activities                              23,815            55,635 
                                          -----------       ----------- 
Investing Activities 
   Purchases of rental equipment              (96,906)         (111,933) 
   Proceeds from sales and disposals 
    of rental equipment                        47,813            44,547 
   Purchase of non-rental property 
    and cloud computing 
    arrangements                              (10,141)           (3,920) 
                                          -----------       ----------- 
      Net cash flow for investing 
       activities                             (59,234)          (71,306) 
                                          -----------       ----------- 
Financing Activities 
   Borrowings under revolving credit 
    facilities                                 35,000            72,575 
   Repayments under revolving credit 
    facilities                                (45,000)               -- 
   Principal payments on long-term 
    debt                                       (2,271)           (2,221) 
   Acquisition of inventory through 
    floor plan payables - non-trade           135,751           125,450 
   Repayment of floor plan payables 
    - non-trade                               (84,905)         (146,033) 
   Repurchase of common stock                      --           (32,575) 
                                          -----------       ----------- 
      Net cash flow from financing 
       activities                              38,575            17,196 
                                          -----------       ----------- 
Effect of exchange rate changes on 
 cash and cash equivalents                        179                50 
                                          -----------       ----------- 
Net Change in Cash and Cash 
 Equivalents                                    3,335             1,575 
Cash and Cash Equivalents at 
 Beginning of Period                            6,273             3,805 
                                          -----------       ----------- 
Cash and Cash Equivalents at End of 
 Period                                $        9,608      $      5,380 
                                          ===========       =========== 
 
 
                                          Three Months Ended March 31, 
                                      ------------------------------------ 
(in $000s)                                    2026              2025 
                                          ------------       ----------- 
Supplemental Cash Flow Information 
   Interest paid                       $        22,128      $     26,839 
   Income taxes paid (refunds 
    received), net                                (235)               -- 
Non-Cash Investing and Financing 
Activities 
   Property and equipment purchases 
    in accounts payable                          3,718               435 
   Rental equipment sales in 
    accounts receivable                          1,428               933 
 

CUSTOM TRUCK ONE SOURCE, INC.

NON-GAAP FINANCIAL AND PERFORMANCE MEASURES

In our press release and schedules, and on the related conference call, we report certain financial measures that are not required by, or presented in accordance with, United States generally accepted accounting principles ("GAAP"). We utilize these financial measures to manage our business on a day-to-day basis and some of these measures are commonly used in our industry to evaluate performance by excluding items considered to be non-recurring. We believe these non-GAAP measures provide investors expanded insight to assess performance, in addition to the standard GAAP-based financial measures. The press release schedules reconcile the most directly comparable GAAP measure to each non-GAAP measure that we refer to. Although management evaluates and presents these non-GAAP measures for the reasons described herein, please be aware that these non-GAAP measures have limitations and should not be considered in isolation or as a substitute for revenue, operating income/loss, net income/loss, earnings/loss per share or any other comparable measure prescribed by GAAP. In addition, we may calculate and/or present these non-GAAP financial measures differently than measures with the same or similar names that other companies report, and as a result, the non-GAAP measures we report may not be comparable to those reported by others.

Adjusted EBITDA. Adjusted EBITDA is a non-GAAP performance measure that we use to monitor our results of operations, to measure performance against debt covenants and performance relative to competitors. We believe Adjusted EBITDA is a useful performance measure because it allows for an effective evaluation of operating performance, without regard to financing methods or capital structures. We exclude the items identified in the reconciliations of net income (loss) to Adjusted EBITDA because these amounts are either non-recurring or can vary substantially within the industry depending upon accounting methods and book values of assets, including the method by which the assets were acquired, and capital structures. Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income (loss) determined in accordance with GAAP. Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company's financial performance, such as a company's cost of capital and tax structure, as well as the historical costs of depreciable assets, none of which are reflected in Adjusted EBITDA. Our presentation of Adjusted EBITDA should not be construed as an indication that results will be unaffected by the items excluded from Adjusted EBITDA. Our computation of Adjusted EBITDA may not be identical to other similarly titled measures of other companies.

We define Adjusted EBITDA as net income or loss before interest expense (excluding interest on floorplan financing), income taxes, depreciation and amortization, share-based compensation, and other items that we do not view as indicative of ongoing performance. Our Adjusted EBITDA includes an adjustment to exclude the effects of purchase accounting adjustments when calculating the cost of inventory and used equipment sold. When inventory or equipment is purchased in connection with a business combination, the assets are revalued to their current fair values for accounting purposes. The consideration transferred (i.e., the purchase price) in a business combination is allocated to the fair values of the assets as of the acquisition date, with amortization or depreciation recorded thereafter following applicable accounting policies; however, this may not be indicative of the actual cost to acquire inventory or new equipment that is added to product inventory or the rental fleets apart from a business acquisition. We also include an adjustment to remove the impact of accounting for certain of our rental contracts with customers containing a rental purchase option that are accounted for under GAAP as a sales-type lease. We include this adjustment because we believe continuing to reflect the transactions as an operating lease better reflects the economics of the transactions given our large portfolio of rental contracts. These, and other, adjustments to GAAP net income or loss that are applied to derive Adjusted EBITDA are specified by our senior secured credit agreement and the indenture of our senior secured notes.

Adjusted Gross Profit. We present total gross profit excluding rental equipment depreciation ("Adjusted Gross Profit") as a non-GAAP financial performance measure. This measure differs from the GAAP definition of gross profit, as we do not include the impact of depreciation expense, which represents non-cash expense. We use this measure to evaluate operating margins and the effectiveness of the cost of our rental fleet.

Net Debt. We present the non-GAAP financial measure "Net Debt," which is total debt (the most comparable GAAP measure, calculated as current and long-term debt, excluding deferred financing fees, plus current and long-term finance lease obligations) minus cash and cash equivalents. We believe this non-GAAP measure is useful to investors to evaluate our financial position.

Net Leverage Ratio. Net leverage ratio is a non-GAAP performance measure used by management and we believe it provides useful information to investors because it is an important measure to evaluate our debt levels and progress toward leverage targets, which is consistent with the manner our lenders and management use this measure. We define net leverage ratio as net debt divided by Adjusted EBITDA for the previous twelve-month period ("last twelve months," or "LTM").

 
CUSTOM TRUCK ONE SOURCE, INC. 
 ADJUSTED EBITDA RECONCILIATION 
 (unaudited) 
 
                    Three Months Ended March 31, 
                 ----------------------------------- 
                                                      Three Months Ended 
(in $000s)              2026                2025       December 31, 2025 
                     ----------          ----------   ------------------ 
Net income 
 (loss)           $      (4,102)      $     (17,791)   $      20,875 
Interest 
 expense                 24,518              25,616           26,364 
Income tax 
 expense 
 (benefit)                  297              (7,701)          (5,867) 
Depreciation 
 and 
 amortization            68,274              62,511           69,013 
                     ----------          ----------       ---------- 
EBITDA                   88,987              62,635          110,385 
Adjustments: 
   Non-cash 
    purchase 
    accounting 
    impact (1)            3,232               4,181            3,967 
   Transaction 
    and 
    integration 
    costs (2)             3,892               3,660            4,430 
   Sales-type 
    lease 
    adjustment 
    (3)                     696                 546             (253) 
   Share-based 
    payments 
    (4)                   1,179               2,404            2,212 
                     ----------          ----------       ---------- 
Adjusted EBITDA   $      97,986       $      73,426    $     120,741 
                     ==========          ==========       ========== 
 

Adjusted EBITDA is defined as net income (loss), as adjusted for provision for income taxes, interest expense, net (excluding interest on floorplan financing), depreciation of rental equipment and non-rental depreciation and amortization, and further adjusted for the impact of the fair value mark-up of acquired rental fleet, business acquisition and merger-related costs, including integration, the impact of accounting for certain of our rental contracts with customers that are accounted for under GAAP as sales-type lease and stock compensation expense. This non-GAAP measure is subject to certain limitations.

 
(1)    Represents the non-cash impact of purchase accounting, net of 
       accumulated depreciation, on the cost of equipment and inventory sold. 
       The equipment and inventory acquired received a purchase accounting 
       step-up in basis, which is a non-cash adjustment to the equipment cost 
       pursuant to our ABL Credit Agreement and Indenture. 
(2)    Represents transaction and other costs related to acquisitions of 
       businesses; costs associated with closed operations; costs associated 
       with restructuring and business optimization activities (inclusive of 
       systems establishment costs); employee retention and/or severance 
       costs; costs related to start-up/pre-openings and openings of 
       locations; reconfiguration or consolidation of facilities or equipment 
       conversion costs. These adjustments are presented as adjustments to net 
       income (loss) pursuant to our ABL Credit Agreement and Indenture. 
(3)    Represents the impact of sales-type lease accounting for certain leases 
       containing rental purchase options (or "RPOs"), as the application of 
       sales-type lease accounting is not deemed to be representative of the 
       ongoing cash flows of the underlying rental contracts. The adjustments 
       are made pursuant to our ABL Credit Agreement and Indenture. The 
       components of this adjustment are presented in the table below: 
 
 
                   Three Months Ended March 31, 
                  -------------------------------  --- 
                                                     Three Months 
                                                    Ended December 
  (in $000s)            2026              2025         31, 2025 
                      --------          --------   ----------------- 
  Equipment 
   sales           $       730       $    (2,161)    $    (2,461) 
  Cost of 
   equipment 
   sales                (1,644)            1,839           1,883 
                      --------          --------   ---  -------- 
     Gross 
      margin              (914)             (322)           (578) 
  Interest 
   (income) 
   expense                 237            (1,012)         (1,374) 
  Rental 
   invoiced              1,373             1,880           1,699 
                      --------          --------   ---  -------- 
     Sales-type 
      lease 
      adjustment   $       696       $       546     $      (253) 
                      ========          ========   ===  ======== 
 
 
(4)    Represents non-cash share-based compensation expense associated with 
       the issuance of restricted stock units. 
 
 
Reconciliation of Adjusted Gross Profit 
 (unaudited) 
 
The following table presents the reconciliation of Adjusted Gross Profit: 
 
                     Three Months Ended March 31, 
                  ---------------------------------- 
                                                          Three Months 
                                                              Ended 
(in $000s)                 2026             2025        December 31, 2025 
                  ---  ------------      -----------  -------------------- 
Revenue 
   Rental 
    revenue         $       137,215   $      116,261   $           141,981 
   Equipment 
    sales                   292,634          273,863               353,925 
   Parts sales 
    and 
    services                 31,773           32,108                32,278 
                  ---  ------------      -----------      ---------------- 
      Total 
       revenue              461,622          422,232               528,184 
                  ---  ------------      -----------      ---------------- 
Cost of Revenue 
   Cost of 
    rental 
    revenue                  31,065           30,400                30,228 
   Depreciation 
    of rental 
    equipment                56,197           50,091                56,762 
   Cost of 
    equipment 
    sales                   243,918          228,477               291,772 
   Cost of parts 
    sales and 
    services                 27,379           27,728                26,361 
                  ---  ------------      -----------      ---------------- 
      Total cost 
       of 
       revenue              358,559          336,696               405,123 
                  ---  ------------      -----------      ---------------- 
Gross Profit                103,063           85,536               123,061 
Add: 
 depreciation of 
 rental 
 equipment                   56,197           50,091                56,762 
                  ---  ------------      -----------      ---------------- 
Adjusted Gross 
 Profit             $       159,260   $      135,627   $           179,823 
                  ===  ============      ===========      ================ 
 
 
Reconciliation of SER Segment Adjusted Gross Profit and Adjusted Rental 
Gross Profit (unaudited) 
 
The following table presents the reconciliation of SER segment Adjusted 
Gross Profit: 
 
                    Three Months Ended March 31, 
                  -------------------------------- 
                                                        Three Months 
                                                            Ended 
(in $000s)                 2026           2025        December 31, 2025 
                  ---  -------------   -----------  -------------------- 
Revenue 
   Rental 
    revenue         $        137,215  $    116,261   $           141,981 
   Equipment 
    sales                     37,777        29,855                55,773 
   Parts sales 
    and 
    services                  18,771        20,965                20,982 
   Intersegment 
    sales                      6,790        11,600                10,489 
                  ---  -------------   -----------      ---------------- 
Total revenue                200,553       178,681               229,225 
                  ---  -------------   -----------      ---------------- 
Cost of Revenue 
   Cost of 
    rental 
    revenue                   31,065        30,400                30,229 
   Cost of 
    equipment 
    sales                     28,214        20,667                39,181 
   Cost of parts 
    and 
    services                  18,019        20,103                17,194 
   Depreciation 
    of rental 
    equipment                 56,197        50,091                56,761 
   Intersegment 
    cost of 
    sales                      6,111        11,600                10,489 
                  ---  -------------   -----------      ---------------- 
Total cost of 
 revenue                     139,606       132,861               153,854 
                  ---  -------------   -----------      ---------------- 
Gross profit                  60,947        45,820                75,371 
   Add: 
    depreciation 
    of rental 
    equipment                 56,197        50,091                56,761 
                  ---  -------------   -----------      ---------------- 
Adjusted Gross 
 Profit             $        117,144  $     95,911   $           132,132 
                  ===  =============   ===========      ================ 
 
 
The following table presents the reconciliation of SER segment Adjusted 
Rental Gross Profit: 
 
                     Three Months Ended March 31, 
                  ---------------------------------- 
                                                          Three Months 
                                                              Ended 
(in $000s)                 2026             2025        December 31, 2025 
                  ---  ------------      -----------  -------------------- 
Rental revenue      $       137,215   $      116,261   $           141,981 
Cost of rental 
 revenue                     31,065           30,400                30,229 
                  ---  ------------      -----------      ---------------- 
Adjusted Rental 
 Gross Profit       $       106,150   $       85,861   $           111,752 
                  ===  ============      ===========      ================ 
 
 
Reconciliation of Net Debt 
 (unaudited) 
 
The following table presents the reconciliation of Net Debt: 
 
(in $000s)                          March 31, 2026     December 31, 2025 
                                   ----------------  --------------------- 
Current maturities of long-term 
 debt                               $        5,085    $          25,858 
Long-term debt, net                      1,628,943            1,619,352 
Deferred financing fees                     14,462               15,549 
Less: cash and cash equivalents             (9,608)              (6,273) 
                                       -----------       -------------- 
   Net Debt                         $    1,638,882    $       1,654,486 
                                       ===========       ============== 
 
 
Reconciliation of Net Leverage Ratio 
 (unaudited) 
 
The following table presents the reconciliation of the Net Leverage Ratio: 
 
                                                Twelve Months Ended 
                                       ------------------------------------- 
(in $000s)                              March 31, 2026    December 31, 2025 
                                       ----------------  ------------------- 
Net Debt (as of period end)             $     1,638,882   $        1,654,486 
Divided by: LTM Adjusted EBITDA (1)     $       408,118   $          383,558 
                                           ------------      --------------- 
Net Leverage Ratio                                 4.02                 4.31 
 
 
(1)    The following tables presents the calculation of LTM Adjusted EBITDA 
       for the periods ended March 31, 2026 and December 31, 2025: 
 
 
                 Current Year   Less: Prior 
                   To Date     Year To Date    Add: Prior   LTM Adjusted 
                    Period        Period      Fiscal Year      EBITDA 
                  March 31,      March 31,    December 31,   March 31, 
(in $000s)           2026          2025           2025          2026 
                 ------------  -------------  ------------  ------------ 
Net income 
 (loss)          $(4,102)      $(17,791)      $(31,052)     $(17,363) 
Interest 
 expense          24,518         25,616        104,882       103,784 
Income tax 
 expense 
 (benefit)           297         (7,701)         2,922        10,920 
Depreciation 
 and 
 amortization     68,274         62,511        264,998       270,761 
                  ------  ---   -------  ---   -------       ------- 
EBITDA            88,987         62,635        341,750       368,102 
Adjustments: 
   Non-cash 
    purchase 
    accounting 
    impact         3,232          4,181         15,469        14,520 
   Transaction 
    and 
    integration 
    costs          3,892          3,660         16,639        16,871 
   Sales-type 
    lease 
    adjustment       696            546          1,229         1,379 
   Share-based 
    payments       1,179          2,404          8,471         7,246 
                  ------  ---   -------  ---   -------       ------- 
   Adjusted 
    EBITDA       $97,986       $ 73,426       $383,558      $408,118 
                  ======  ===   =======  ===   =======       ======= 
 

View source version on businesswire.com: https://www.businesswire.com/news/home/20260427165596/en/

 
    CONTACT:    INVESTOR CONTACT 

Brian Perman, Vice President, Investor Relations

investors@customtruck.com

 
 

(END) Dow Jones Newswires

April 27, 2026 16:10 ET (20:10 GMT)

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