MINI
#If we look at the downstream segment, we saw stable business in the quarter.
There was not that much turnover activity as we would have liked.
But that's purely timing issues.
I think for 2017 we expect a lot more turnaround activity for that segment.
The pipeline looks good at this point.
In the upstream markets, we did see some more rigs coming online, more activity toward the end of the quarter, but it really didn't translate into some big shift in our numbers yet.
If this continues we should see it pick up in that segment, but it hasn't really translated into more business for us just yet.
On the cost side we had a little migration of fleet, higher R&M and higher bad debt on some accounts, so I'd say it's somewhere close to $1 million of incremental or above-normalized costs in the quarter for specialty containment, which we don't expect to continue.
It was concentrated on, I'd say, a handful of accounts, not a concern from an ongoing revenue perspective.
At the end of the day, even when you look at the increase in bad debts, we're still running only somewhere around 2% of revenue for a full year.
So we feel good about the customer base and any type of bad debt, especially going forward, it was just a few account true-ups, basically.
Sure.
Again, these things are obviously driven by the customer, and when they choose to do their turnaround activities or not.
The fact is, over the last couple of years, there's been some major delays or postponement of turnaround, so we feel very good about them actually happening here in 2017.
I will not pinpoint the quarter, because I can't really do that.
But like I said, we feel confident that they will happen.
Pricing has been remarkably stable in the specialty containment segment.
There are pressures, obviously, and negotiations taking place, but we have been able to keep our rates fairly flat, actually, on a year-over-year basis which we're obviously very happy about.
Thank you.
On construction, I think we see a solid, steady demand.
We are actually fairly optimistic about 2017 here in that segment.
<UNK> has said the year has started off fairly well for us.
The industrial/commercial segment is largely the downstream segment that I mentioned before, and again, we feel good about the year and good about the pipeline we see at the moment, and the prospects that we have to go after during the course of the year.
It's largely construction activity or a reflection of the customer mix that we have.
It's not a typical turnaround month for customers in the downstream segment, if you like.
I'd say it's a general mix of business that we have, have all responded fairly well to our activities.
We're taking a lot of business.
We feel confident about those three ---+ all our end segments, but the construction, industrial, as well as the retail consumer services.
I think in general, retail was very solid, but the seasonal obviously was up a couple thousand units as <UNK> highlighted, and somewhere probably around $1 million in rental revenue, Q4 over Q4.
That's how we translate.
In general, I would say the environment is solid for us.
And we've invested in some great talent on our national sales side, so that's actually driving some nice retail business on a more national basis.
No, we did not.
This was across the country, and like <UNK> and I said earlier, it had a lot to do with the way we executed against these large retailers.
So I think we did a much better job than we have in the past, and as a result we grew that business very nicely.
Just geography-wise, I'd say we're doing a good job in the southeast, the Midatlantic, California is doing pretty well.
That's just broad brush across all end segments, but we're not seeing any weakness geography, from a geographic standpoint and that includes the UK.
There's uncertainty with Brexit and all that, but we had a record quarter there.
No, I think we have implemented all the actions that we talked about in our Q3 call.
So we have put in place a much better onboarding process.
We have expanded our inside sales managers from 8 to 14, and they're all onboard.
We have put in place a much more structured coaching environment, et cetera.
So all the pieces of the puzzle that we believe are necessary are in place, and it's just a matter of letting these things now work through and take hold.
So I believe we've done what's necessary and we should see the impact here over the coming quarters.
Yes, absolutely.
We have state-of-the-art technology for our sales team.
We made significant investments in 2015 and 2016.
We use www.salesforce.com and we built a proprietary territory management system to support them, et cetera.
So those pieces are also in place.
There's nothing further to come at this point.
Fair enough.
For the quarter it was basically down about $3 million, and what I'd call incentive comp, $1 million in bonus and about $2 million in stock comp.
So it's basically where we hit our internal targets, we actually trued up in Q4, so that's ---+ if we adjusted for that, we'd probably be down 200-ish basis points or so from an EBITDA margin perspective.
I would say there's a mix component.
Obviously it's more ---+ the decline is on some of the higher-priced units on the upstream side, which rent for a higher price than our average unit, so I'd say, yes, a mix is a part of that.
As you look at our OEC utilization on the downstream side, that was, I'd say, very solid.
So it really has to do more with the decline on the upstream side at higher pricing, basically, per unit.
I'd say we continue to be focused on that, but at the same time we'll repurchase shares on an opportunistic basis.
Obviously we buy about $4 million worth of shares at less than $25 a share in Q4.
So I would say the focus is to continue to bring the debt down from 4.9 times to slightly below 4 times.
But still repurchase from time to time.
So it's going to be a balancing act, but our eye is on reducing debt and bring down our debt multiple.
Thank you very much for participating on this call and we look forward to speaking with you again with our Q1 results.
Thank you.
