UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended ~~September 30, 2022~~March 31, 2023
OR
☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________


Commission File Number:			001-37552

WILLSCOT MOBILE MINI HOLDINGS CORP.

(Exact name of registrant as specified in its charter)


Delaware						82-3430194
(State or other jurisdiction of incorporation)						(I.R.S. Employer Identification No.)

4646 E Van Buren St., Suite 400

Phoenix, Arizona 85008

(Address, including zip code, of principal executive ~~offices, including zip code)~~offices)

(480) 894-6311

(Registrant’s telephone number, including area code)

(Former Name or Former Address, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	WSC	The Nasdaq Capital Market
~~Warrants to purchase Common Stock(1)~~	~~WSCTW~~	~~OTC Markets Group Inc.~~

~~(1)~~ Issued in connection with the registrant's acquisition of Modular Space Holding, Inc. in August 2018, which are exercisable for one share of the registrant's common stock at an exercise price of $15.50 per share.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☒			Accelerated filer ☐
Non-accelerated filer ☐			Smaller reporting company ☐
			Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

Shares of Common Stock, par value $0.0001 per share, ~~outstanding: 208,889,811~~outstanding: 202,317,982 shares at ~~November 1, 2022.~~April 24, 2023.

WILLSCOT MOBILE MINI HOLDINGS CORP.

Quarterly Report on Form 10-Q

Table of Contents


PART I Financial Information
	Item 1	Financial Statements (unaudited,) except as noted below)
			Condensed Consolidated Balance Sheets as of ~~September~~March 31, 2023 30 ~~, 2022~~ and December 31, 20212 (audited)
			Condensed Consolidated Statements of Operations for the Three ~~and~~ ~~Nine~~ Months Ended ~~September~~March 31 ~~30, 2022~~, 202 3 and 20212
			Condensed Consolidated Statements of Comprehensive Income for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~
			Condensed Consolidated Statements of Changes in Equity for the Three ~~and~~ ~~Nine~~Months Ended ~~September~~March 31 ~~30, 2022~~, 202 3 and 20212
			Condensed Consolidated Statements of Cash Flows for the ~~Nine~~ Th ree Months Ended ~~September~~March 31 ~~30, 2022~~, 202 3 and 20212
			Notes to the Condensed Consolidated Financial Statements
	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 3	Quantitative and Qualitative Disclosures About Market Risk
	Item 4	Controls and Procedures
PART II Other Information
	Item 1	Legal Proceedings
	Item 1A	Risk Factors
	Item 2	Unregistered Sales of Equity Securities and Use of Proceeds
	Item 3	Defaults Upon Senior Securities
	Item 4	Mine Safety Disclosures
	Item 5	Other Information
	Item 6	Exhibits
SIGNATURE

ITEM 1. Financial Statements

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Balance Sheets ~~(Unaudited)~~


(in thousands, except share data)	March 31, 2023 (unaudited)		December 31, 2022

Assets
Cash and cash equivalents	$	15,918	$	7,390
Trade receivables, net of allowances for credit losses at March 31, 2023 and December 31, 2022 of $61,402 and $57,048, respectively	415,344		409,766
Inventories	42,007		41,030
Prepaid expenses and other current assets	42,684		31,635
Assets held for sale - current	8,924		31,220
Total current assets	524,877		521,041
Rental equipment, net	3,128,061		3,077,287
Property, plant and equipment, net	305,608		304,659
Operating lease assets	219,926		219,405
Goodwill	1,011,513		1,011,429
Intangible assets, net	413,188		419,125
Other non-current assets	6,578		6,683
Assets held for sale - non-current	—		268,022
Total long-term assets	5,084,874		5,306,610
Total assets	$	5,609,751	$	5,827,651
Liabilities and equity
Accounts payable	$	92,057	$	108,071
Accrued expenses	120,838		110,820
Accrued employee benefits	28,803		56,340
Deferred revenue and customer deposits	199,274		203,793
Operating lease liabilities - current	51,076		50,499
Current portion of long-term debt	13,514		13,324
Liabilities held for sale - current	—		19,095
Total current liabilities	505,562		561,942
Long-term debt	2,876,453		3,063,042
Deferred tax liabilities	464,798		401,453
Operating lease liabilities - non-current	169,914		169,618

Other non-current liabilities	29,100		18,537
Liabilities held for sale - non-current	—		47,759
Long-term liabilities	3,540,265		3,700,409
Total liabilities	4,045,827		4,262,351

Preferred Stock: $0.0001 par, 1,000,000 shares authorized and zero shares issued and outstanding at March 31, 2023 and December 31, 2022	—		—
Common Stock: $0.0001 par, 500,000,000 shares authorized and 203,723,099 and 207,951,682 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively	21		21
Additional paid-in-capital	2,667,424		2,886,951
Accumulated other comprehensive loss	(62,855)		(70,122)
Accumulated deficit	(1,040,666)		(1,251,550)
Total shareholders' equity	1,563,924		1,565,300
Total liabilities and shareholders' equity	$	5,609,751	$	5,827,651

(in thousands, except share data) September 30, 2022 December 31, 2021
Assets
Cash and cash equivalents $ 15,442 $ 12,699
Trade receivables, net of allowances for credit losses of $56,127 and $46,160, respectively 439,309 368,856
Inventories 44,873 32,092
Prepaid expenses and other current assets 39,691 36,539
Assets held for sale - current 951 32,854
Total current assets 540,266 483,040
Rental equipment, net 3,227,735 2,946,008
Property, plant and equipment, net 311,526 282,247
Operating lease assets 225,955 235,344
Goodwill 1,064,582 1,078,699
Intangible assets, net 431,291 451,928
Other non-current assets 8,909 10,797
Assets held for sale - non-current — 285,536
Total long-term assets 5,269,998 5,290,559
Total assets $ 5,810,264 $ 5,773,599
Liabilities and equity
Accounts payable $ 160,262 $ 110,270
Accrued expenses 123,300 95,592
Accrued employee benefits 53,477 65,927
Deferred revenue and customer deposits 212,005 159,612
Operating lease liabilities - current 51,971 51,103
Current portion of long-term debt 13,497 11,968
Liabilities held for sale - current — 23,173
Total current liabilities 614,512 517,645
Long-term debt 2,935,800 2,676,985
Deferred tax liabilities 385,854 337,784
Operating lease liabilities - non-current 174,777 184,199
Other non-current liabilities 18,182 15,737
Liabilities held for sale - non-current — 44,486
Long-term liabilities 3,514,613 3,259,191
Total liabilities 4,129,125 3,776,836
Commitments and contingencies (see Note 17)
Preferred Stock: $0.0001 par, 1,000,000 shares authorized and zero shares issued and outstanding — —
Common Stock: $0.0001 par, 500,000,000 shares authorized and 211,243,820 and 223,939,527 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively 22 22
Additional paid-in capital 3,112,076 3,616,902
Accumulated other comprehensive loss (93,009) (29,071)
Accumulated deficit (1,337,950) (1,591,090)
Total shareholders' equity 1,681,139 1,996,763
Total liabilities and shareholders' equity $ 5,810,264 $ 5,773,599

See the accompanying notes which are an integral part of these condensed consolidated financial statements.

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Statements of Operations

(Unaudited)


	Three Months Ended March 31,
(in thousands, except share and per share data)	2023		2022
Revenues:
Leasing and services revenue:
Leasing	$	439,951	$	351,559
Delivery and installation	106,630		85,539
Sales revenue:
New units	10,657		5,787
Rental units	8,230		8,286
Total revenues	565,468		451,171
Costs:
Costs of leasing and services:
Leasing	97,515		80,334
Delivery and installation	75,007		70,580
Costs of sales:
New units	6,208		3,756
Rental units	4,454		4,892
Depreciation of rental equipment	59,156		57,548
Gross profit	323,128		234,061
Expenses:
Selling, general and administrative	150,892		138,144

Other depreciation and amortization	17,173		15,362


Currency losses, net	6,775		137
Other income, net	(3,359)		(1,283)
Operating income	151,647		81,701
Interest expense	44,866		30,570
Income from continuing operations before income tax	106,781		51,131
Income tax expense from continuing operations	30,510		12,083
Income from continuing operations	76,271		39,048

Discontinued operations:
Income from discontinued operations before income tax	4,003		15,787
Gain on sale of discontinued operations	176,078		—
Income tax expense from discontinued operations	45,468		3,664
Income from discontinued operations	134,613		12,123

Net income	$	210,884	$	51,171

Earnings per share from continuing operations attributable to WillScot Mobile Mini common shareholders:
Basic	$	0.37	$	0.17
Diluted	$	0.36	$	0.17
Earnings per share from discontinued operations attributable to WillScot Mobile Mini common shareholders:
Basic	$	0.65	$	0.06
Diluted	$	0.64	$	0.05
Earnings per share attributable to WillScot Mobile Mini common shareholders:
Basic	$	1.02	$	0.23
Diluted	$	1.00	$	0.22
Weighted average shares:
Basic	206,092,169		223,490,912
Diluted	209,663,985		228,955,504

See the accompanying notes which are an integral part of these condensed consolidated financial statements.

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Statements of ~~Operations (Unaudited)~~
Three Months Ended September 30, Nine Months Ended September 30,
(in thousands, except share and per share data) 2022 2021 2022 2021
Revenues:
Leasing and services revenue:
Leasing $ 447,535 $ 342,599 $ 1,226,206 $ 965,894
Delivery and installation 132,837 91,910 341,027 252,914
Sales revenue:
New units 9,901 15,370 26,232 35,915
Rental units 13,900 11,168 38,874 40,911
Total revenues 604,173 461,047 1,632,339 1,295,634
Costs:
Costs of leasing and services:
Leasing 111,898 77,967 288,774 222,747
Delivery and installation 95,680 74,221 256,130 209,963
Costs of sales:
New units 6,007 11,175 15,469 24,322
Rental units 7,097 5,468 21,123 22,441
Depreciation of rental equipment 69,159 52,990 192,228 165,027
Gross profit 314,332 239,226 858,615 651,134
Expenses:
Selling, general and administrative 145,444 127,346 445,319 356,651
Other depreciation and amortization 17,066 16,459 50,895 51,793
Lease impairment expense and other related charges — 601 254 2,328
Restructuring costs — 1,856 (86) 11,956
Currency losses, net 236 127 247 196
Other (income) expense, net (2,526) 1,475 (7,642) 202
Operating income 154,112 91,362 369,628 228,008
Interest expense 38,165 29,006 102,362 87,793
Fair value loss on common stock warrant liabilities — — — 26,597
Loss on extinguishment of debt — — — 5,999
Income from continuing operations before income tax 115,947 62,356 267,266 107,619
Income tax expense from continuing operations 30,219 5,243 67,167 32,341
Income from continuing operations 85,728 57,113 200,099 75,278
Discontinued operations:
Income from discontinued operations before income tax 10,802 5,391 24,488 14,255
Income tax expense from discontinued operations 1,986 1,401 5,496 3,612
Gain on sale of discontinued operations 34,049 — 34,049 —
Income from discontinued operations 42,865 3,990 53,041 10,643
Net income $ 128,593 $ 61,103 $ 253,140 $ 85,921
Comprehensive Income

(Unaudited)

Earnings per share from continuing operations:
Basic $ 0.40 $ 0.25 $ 0.91 $ 0.33
Diluted $ 0.39 $ 0.24 $ 0.89 $ 0.32
Earnings per share from discontinued operations:
Basic $ 0.20 $ 0.02 $ 0.24 $ 0.05
Diluted $ 0.20 $ 0.02 $ 0.24 $ 0.05
Earnings per share:
Basic $ 0.60 $ 0.27 $ 1.15 $ 0.38
Diluted $ 0.59 $ 0.26 $ 1.13 $ 0.37
Weighted average shares:
Basic 213,636,876 225,998,202 219,312,260 227,557,664
Diluted 217,927,725 231,868,397 223,933,319 234,084,800


	Three Months Ended March 31,
(in thousands)	2023		2022
Net income	$	210,884	$	51,171
Other comprehensive income (loss):
Foreign currency translation adjustment, net of income tax expense of $0 for each of the three months ended March 31, 2023 and 2022	7,934		(4,074)
Net (loss) gain on derivatives, net of income tax (benefit) expense of $(222) and $777 for the three months ended March 31, 2023 and 2022, respectively	(667)		2,321
Total other comprehensive income (loss)	7,267		(1,753)
Total comprehensive income	$	218,151	$	49,418

See the accompanying notes which are an integral part of these condensed consolidated financial statements.

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Statements of ~~Comprehensive Income (Unaudited)~~Changes in Equity

Three Months Ended September 30, Nine Months Ended
September 30,
(in thousands) 2022 2021 2022 2021
Net income $ 128,593 $ 61,103 $ 253,140 $ 85,921
Other comprehensive (loss) income:
Foreign currency translation adjustment, net of income tax expense of $0 for both the three and nine months ended September 30, 2022 and $0 and $60 for the three and nine months ended September 30, 2021, respectively. (37,733) (11,162) (67,435) (3,035)
Net change in derivatives, net of income tax expense of $676 for the three months ended September 30, 2021, and $1,171 and $1,999 for the nine months ended September 30, 2022 and 2021, respectively. — 2,206 3,497 6,529
Total other comprehensive (loss) income (37,733) (8,956) (63,938) 3,494
Total comprehensive income $ 90,860 $ 52,147 $ 189,202 $ 89,415
(Unaudited)


Three Months Ended March 31, 2023
	Common Stock			Additional Paid-in-Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Shareholders' Equity
(in thousands)	Shares	Amount
Balance at December 31, 2022	207,952	$	21	$	2,886,951	$	(70,122)	$	(1,251,550)	$	1,565,300
Net income	—	—		—		—		210,884		210,884
Other comprehensive income	—	—		—		7,267		—		7,267
Withholding taxes on net share settlement of stock-based compensation	—	—		(10,058)		—		—		(10,058)
Stock-based compensation and issuance of Common Stock from vesting	355	—		8,150		—		—		8,150
Repurchase and cancellation of Common Stock	(4,589)	—		(217,687)		—		—		(217,687)
Issuance of Common Stock from the exercise of options	6	—		68		—		—		68
Balance at March 31, 2023	203,723	$	21	$	2,667,424	$	(62,855)	$	(1,040,666)	$	1,563,924


Three Months Ended March 31, 2022
	Common Stock			Additional Paid-in-Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Shareholders' Equity
(in thousands)	Shares	Amount
Balance at December 31, 2021	223,940	$	22	$	3,616,902	$	(29,071)	$	(1,591,090)	$	1,996,763
Net income	—	—		—		—		51,171		51,171
Other comprehensive loss	—	—		—		(1,753)		—		(1,753)
Withholding taxes on net share settlement of stock-based compensation	—	—		(12,295)		—		—		(12,295)
Stock-based compensation and issuance of Common Stock from vesting	498	—		6,395		—		—		6,395
Repurchase and cancellation of Common Stock and warrants	(2,064)	—		(77,409)		—		—		(77,409)
Issuance of Common Stock from the exercise of options and warrants	800	—		3,313		—		—		3,313
Balance at March 31, 2022	223,174	$	22	$	3,536,906	$	(30,824)	$	(1,539,919)	$	1,966,185

See the accompanying notes which are an integral part of these condensed consolidated financial statements.

WillScot Mobile Mini Holdings Corp.

Condensed Consolidated Statements of ~~Changes in Equity (Unaudited)~~
Nine Months Ended September 30, 2022
Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Shareholders' Equity
(in thousands) Shares Amount
Balance at December 31, 2021 223,940 $ 22 $ 3,616,902 $ (29,071) $ (1,591,090) $ 1,996,763
Net income — — — — 51,171 51,171
Other comprehensive loss — — — (1,753) — (1,753)
Stock-based compensation and issuance of Common Stock from vesting 498 — 6,395 — — 6,395
Repurchase and cancellation of Common Stock and warrants (2,064) — (77,409) — — (77,409)
Issuance of Common Stock from the exercise of options and warrants 800 — 3,313 — — 3,313
Withholding taxes on net share settlement of stock-based compensation — — (12,295) — — (12,295)
Balance at March 31, 2022 223,174 22 3,536,906 (30,824) (1,539,919) 1,966,185
Net income — — — — 73,376 73,376
Other comprehensive loss — — — (24,452) — (24,452)
Stock-based compensation and issuance of Common Stock from vesting 70 — 9,292 — — 9,292
Repurchase and cancellation of Common Stock and warrants (7,222) — (249,515) — — (249,515)
Issuance of Common Stock from the exercise of options and warrants 69 — 139 — — 139
Withholding taxes on net share settlement of stock-based compensation — — (1,075) — — (1,075)
Balance at June 30, 2022 216,091 22 3,295,747 (55,276) (1,466,543) 1,773,950
Net income — — — — 128,593 128,593
Other comprehensive loss — — — (37,733) — (37,733)
Stock-based compensation and issuance of Common Stock from vesting 26 — 6,941 — — 6,941
Repurchase and cancellation of Common Stock (5,271) — (197,457) — — (197,457)
Issuance of Common Stock from the exercise of options 398 — 7,363 — — 7,363
Withholding taxes on net share settlement of stock-based compensation — — (518) — — (518)
Balance at September 30, 2022 211,244 $ 22 $ 3,112,076 $ (93,009) $ (1,337,950) $ 1,681,139
Cash Flows

(Unaudited)

Nine Months Ended September 30, 2021
Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Shareholders' Equity
(in thousands) Shares Amount
Balance at December 31, 2020 229,038 $ 23 $ 3,852,291 $ (37,207) $ (1,751,234) $ 2,063,873
Net income — — — — 4,447 4,447
Other comprehensive income — — — 7,211 — 7,211
Stock-based compensation and issuance of Common Stock from vesting 229 — 4,951 — — 4,951
Repurchase and cancellation of Common Stock and warrants (2,793) — (76,788) — — (76,788)
Issuance of Common Stock from the exercise of options and warrants 341 — 5,414 — — 5,414
Withholding taxes on net share settlement of stock-based compensation — — (3,219) — — (3,219)
Balance at March 31, 2021 226,815 23 3,782,649 (29,996) (1,746,787) 2,005,889
Net income — — — — 20,371 20,371
Other comprehensive income — — — 5,239 — 5,239
Stock-based compensation and issuance of Common Stock from vesting 60 — 9,038 — — 9,038
Repurchase and cancellation of Common Stock and warrants (4,100) — (35,508) — — (35,508)
Issuance of Common Stock from the exercise of warrants 4,058 — 384 — — 384
Balance at June 30, 2021 226,833 23 3,756,563 (24,757) (1,726,416) 2,005,413
Net income — — — — 61,103 61,103
Other comprehensive income — — — (8,956) — (8,956)
Stock-based compensation and issuance of Common Stock from vesting 192 — 7,686 — — 7,686
Repurchase and cancellation of Common Stock and warrants (3,752) — (106,264) — — (106,264)
Issuance of Common Stock from the exercise of warrants 393 — 1,517 — — 1,517
Withholding taxes on net share settlement of stock-based compensation — — (3,915) — — (3,915)
Balance at September 30, 2021 223,666 $ 23 $ 3,655,587 $ (33,713) $ (1,665,313) $ 1,956,584


	Three Months Ended March 31,
(in thousands)	2023		2022
Operating activities:
Net income	$	210,884	$	51,171
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	76,329		81,820
Provision for credit losses	8,803		8,601
Gain on sale of discontinued operations	(176,078)		—

Gain on sale of rental equipment and other property, plant and equipment	(3,396)		(3,232)
Amortization of debt discounts and debt issuance costs	2,743		3,489


Stock-based compensation expense	8,150		6,395
Deferred income tax expense	63,699		12,362
Loss on foreign currency forward contract	7,715		—
Unrealized currency losses, net	(1,042)		86
Other	1,087		914
Changes in operating assets and liabilities:
Trade receivables	(10,954)		(12,064)
Inventories	(350)		(7,122)
Prepaid expenses and other assets	(3,049)		(9,042)
Operating lease assets and liabilities	345		268

Accounts payable and other accrued expenses	(32,694)		(1,239)
Deferred revenue and customer deposits	(3,427)		13,120
Net cash provided by operating activities	148,765		145,527
Investing activities:
Proceeds from sale of discontinued operations	403,992		—
Acquisitions, net of cash acquired	(78,503)		(57,457)
Proceeds from sale of rental equipment	7,781		14,554
Purchase of rental equipment and refurbishments	(47,128)		(95,236)
Payment for settlement of foreign currency forward contract	(7,715)		—
Proceeds from the sale of property, plant and equipment	258		260
Purchase of property, plant and equipment	(6,736)		(10,481)
Net cash provided by (used in) investing activities	271,949		(148,360)
Financing activities:
Receipts from issuance of Common Stock from the exercise of options	68		3,313
Repurchase and cancellation of Common Stock and warrants	(215,098)		(77,708)

Receipts from borrowings	363,800		152,500

Repayment of borrowings	(558,300)		(59,000)

Principal payments on finance lease obligations	(3,499)		(5,224)
Taxes paid on employee stock awards	(10,058)		(12,295)

Net cash (used in) provided by financing activities	(423,087)		1,586
Effect of exchange rate changes on cash and cash equivalents	517		(131)
Net change in cash and cash equivalents	(1,856)		(1,378)
Cash and cash equivalents at the beginning of the period	17,774		12,699
Cash and cash equivalents at the end of the period	$	15,918	$	11,321

Supplemental cash flow information:
Interest paid, net	$	39,570	$	22,197
Income taxes paid, net	$	5,653	$	2,606
Assets acquired under capital leases	$	8,907	$	7,011
Capital expenditures accrued or payable	$	17,786	$	28,433

See the accompanying notes which are an integral part of these condensed consolidated financial statements.

~~WillScot Mobile Mini Holdings Corp.~~

~~Condensed Consolidated Statements of Cash Flows (Unaudited)~~
Nine Months Ended September 30,
(in thousands) 2022 2021
Operating activities:
Net income $ 253,140 $ 85,921
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 257,371 235,536
Provision for credit losses 26,018 26,661
Gain on sale of discontinued operations (34,049) —
Gain on sale of rental equipment and other property, plant and equipment (21,698) (25,327)
Amortization of debt discounts and debt issuance costs 9,795 10,554
Fair value loss on common stock warrant liabilities — 26,597
Loss on extinguishment of debt — 5,999
Stock-based compensation expense 22,628 21,674
Deferred income tax expense 56,812 28,140
Unrealized currency losses, net 171 34
Other 2,976 —
Changes in operating assets and liabilities:
Trade receivables (101,895) (93,592)
Inventories (13,623) (7,311)
Prepaid expenses and other assets (9,446) 3,118
Operating lease assets and liabilities 851 59
Accounts payable and other accrued expenses 43,565 48,336
Deferred revenue and customer deposits 51,622 25,656
Net cash provided by operating activities 544,238 392,055
Investing activities:
Proceeds from sale of discontinued operation 319,543 —
Acquisitions, net of cash acquired (208,663) (56,244)
Proceeds from sale of rental equipment 52,263 42,034
Purchase of rental equipment and refurbishments (360,465) (178,191)
Proceeds from sale of property, plant and equipment 1,645 16,647
Purchase of property, plant and equipment (30,253) (20,836)
Net cash used in investing activities (225,930) (196,590)
Financing activities:
Receipts from issuance of Common Stock from the exercise of options 10,815 7,315
Repurchase and cancellation of Common Stock and warrants (515,684) (320,562)
Receipts from borrowings 763,177 551,063
Repayment of borrowings (510,677) (423,591)
Payment of financing costs (8,130) —
Payment of debt extinguishment premium costs — (3,705)
Principal payments on finance lease obligations (39,336) (12,321)
Taxes paid on employee stock awards (13,888) (7,134)
Net cash used in financing activities (313,723) (208,935)
Effect of exchange rate changes on cash and cash equivalents (1,842) (150)
Net change in cash and cash equivalents 2,743 (13,620)
Cash and cash equivalents at the beginning of the period 12,699 24,937
Cash and cash equivalents at the end of the period $ 15,442 $ 11,317
Supplemental cash flow information:
Interest paid 1
$ 88,231 $ 75,423
Income taxes paid, net $ 17,598 $ 6,124
Capital expenditures accrued or payable $ 40,385 $ 35,819

1~~Includes~~ ~~$8,986~~ ~~of payments related to the interest rate swap for the nine months ended September 30, 2021.~~

~~See the accompanying notes which are an integral part of these condensed consolidated financial statements.~~

WillScot Mobile Mini Holdings Corp.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

NOTE 1 - Summary of Significant Accounting Policies

Organization and Nature of Operations

WillScot Mobile Mini Holdings Corp. (“WillScot Mobile Mini” and, together with its subsidiaries, the “Company”) is a leading business services provider specializing in innovative flexible work space and portable storage solutions in the United States (“US”), Canada, ~~Mexico~~ and ~~the United Kingdom ("UK").~~Mexico. The Company leases, sells, delivers and installs ~~mobile~~modular space solutions and portable storage products through an integrated network of branch locations that spans North ~~America and the UK.~~America.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all the information and notes required by US Generally Accepted Accounting Principles ("GAAP") for complete financial statements. The accompanying unaudited condensed consolidated financial statements comprise the financial statements of WillScot Mobile Mini and its subsidiaries that it controls due to ownership of a majority voting interest and contain all adjustments, which are of a normal and recurring nature, considered necessary by management to present fairly the financial position, results of operations and cash flows for the interim periods presented.

Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the Company. All intercompany balances and transactions are eliminated.

The results of operations for the three ~~and nine~~ months ended ~~September 30, 2022~~March 31, 2023 are not necessarily indicative of the results to be expected for the full year. For further information, refer to the consolidated financial statements and notes included in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022.

Reclassifications

Certain reclassifications have been made to prior year financial statements to conform to the current year presentation.

Recently Issued and Adopted Accounting Standards

In October 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ~~("ASU")~~No. 2021-08, B~~Business~~usiness Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("("ASU 2021-08"). ASU 2021-08 requires that an acquirer recognize and measure contract assets and liabilities acquired in a business combination in accordance with ~~ASU 2014-09,~~FASB Accounting Standards Codification 606, Revenue from Contracts with Customers ~~(Topic 606)~~ ("ASC 606"). The Company adopted ASU 2021-08 ~~is effective for annual periods beginning after December 15, 2022, including interim periods therein, with early~~on January 1, 2023 on a prospective basis. The adoption ~~permitted. The guidance will be applied prospectively to acquisitions occurring on or after the effective date. The Company will continue to evaluate the impact~~ of this ~~guidance, which will depend~~ASU did not have a material impact on the ~~contract assets and liabilities acquired in future business combinations.~~Company's financial statements or related disclosures.

NOTE 2 - Acquisitions

~~On July 1, 2020,~~WillScot Mobile Mini is the holding company for the Williams Scotsman and Mobile Mini family of companies, which resulted from the combination of WillScot Corporation (“WillScot”), and Mobile Mini, Inc. (“Mobile Mini”) ~~merged~~through a merger that occurred on July 1, 2020 (the ~~“Merger”~~"Merger"). ~~Immediately following the Merger, WillScot changed its name to “WillScot Mobile Mini Holdings Corp.”~~

Asset Acquisitions

During the ~~third~~first quarter of ~~2022,~~2023, the Company acquired certain assets and liabilities of ~~several smaller entities,~~two regional and local storage and modular companies, which consisted primarily of approximately ~~7,600~~300 storage units and ~~3,000~~500 modular units for ~~$104.7~~$79.6 million ~~in cash.~~ During the first six months of 2022, the Company acquired certain assets and liabilities of several smaller entities, which consisted primarily of approximately 4,100 storage units and 1,400 modular units, for ~~$103.9 million~~ in cash. The accompanying consolidated financial statements include ~~$202.3 million~~ ~~of rental equipment as a result of 2022 acquisitions.~~

During the third quarter of 2021, the Company acquired certain assets and liabilities of several smaller entities, which consisted primarily of approximately 11,000 storage units and 400 modular units for $56.3 million in cash. As a result of these acquisitions, the Company recognized $53.0$70.4 million of rental equipment and ~~$3.0~~$4.5 million of land ~~in its consolidated balance sheet.~~held for sale as of March 31, 2023 as a result of these acquisitions. A sale of the acquired land is expected to close before the end of the year.

Integration Costs

The Company recorded $3.9 million and ~~$8.2~~$4.1 million in integration costs related to asset acquisitions and the Merger within selling, general and administrative ("SG&A") expense during the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021, respectively, and $13.2 million and $23.2 million in integration costs related to acquisitions and the Merger during the nine months ended September 30, 2022 and 2021,~~ respectively.

108

NOTE 3 - Discontinued Operations

Tank and Pump Divestiture

On ~~August 19,~~September 30, 2022, the Company ~~entered into a stock purchase agreement to sell~~sold its former Tank and Pump ~~Solutions ("Tank and Pump") business~~segment for ~~approximately $323~~$321.9 million. ~~The sale transaction was completed on September 30, 2022.~~ Exiting the former Tank and Pump ~~business~~segment represented the Company’s strategic shift to concentrate its operations on its core modular and storage businesses. ~~In accordance with ASC 360,~~ ~~Property, Plant, and Equipment,~~ the Company ceased recording depreciation and amortization for Tank and Pump rental fleet, property, plant and equipment, and operating lease assets during the third quarter of 2022 when the Tank and Pump business initially qualified as held for sale. In accordance with ASC 205-20, ~~Presentation of Financial Statements - Discontinued Operations, the Company determined that the~~The criteria for discontinued operations presentation were met during the third quarter of 2022 and results for the former Tank and Pump segment are reported in income from discontinued operations within the consolidated statements of operations for periods presented prior to September 30, 2022.

~~As part of the divestiture,~~UK Storage Solutions Divestiture

On December 12, 2022, the Company entered into a ~~customary transition services~~stock purchase agreement ~~with the buyer~~ to ~~assist them in the transition of certain functions, including, but not limited to, information technology, accounting and human resources, for a period of six months with an option~~sell its former UK Storage Solutions segment. The sale transaction was completed on January 31, 2023. Total cash consideration for the ~~buyer~~transaction was $418.1 million. Exiting the former UK Storage Solutions segment represented the Company’s strategic shift to ~~extend~~concentrate its operations on its core modular and storage businesses in North America. The criteria for discontinued operations presentation were met during the ~~agreement~~fourth quarter of 2022 and results for ~~a period~~the former UK Storage Solutions segment are reported in income from discontinued operations within the consolidated statements of ~~up to twelve months. There will be no significant continuing involvement with~~operations for all periods presented. The carrying value of the ~~Tank~~former UK Storage Solutions segment's assets and ~~Pump business after its disposal.~~liabilities are presented within assets and liabilities held for sale on the consolidated balance sheet as of December 31, 2022.

The following tables present the results of the former Tank and Pump segment and the former UK Storage Solutions segment as reported in income from discontinued operations within the ~~condensed~~ consolidated statements of operations, ~~for the three and nine months ended September 30, 2022 and 2021~~ and the carrying value of the ~~divested business'~~former UK Storage Solutions segment's assets and liabilities as presented within assets and liabilities held for sale on the ~~condensed~~ consolidated balance ~~sheet as~~sheet.


	Three Months Ended March 31, 2023
(in thousands)	UK Storage Solutions
Revenues:
Leasing and services revenue:
Leasing	$	6,389
Delivery and installation	1,802
Sales revenue:
New units	54
Rental units	449
Total revenues	8,694
Costs:
Costs of leasing and services:
Leasing	1,407
Delivery and installation	1,213
Costs of sales:
New units	38
Rental units	492

Gross profit	5,544
Expenses:
Selling, general and administrative	1,486



Other income, net	(1)
Operating income	4,059
Interest expense	56
Income from discontinued operations before income tax	4,003
Gain on sale of discontinued operations	175,708
Income tax expense from discontinued operations	45,468
Income from discontinued operations	$	134,243
Other selected data:
Adjusted EBITDA from discontinued operations	$	4,124

In January 2023, a $0.4 million adjustment was made to the gain on sale of ~~December~~the former Tank and Pump segment due to the final contractual working capital adjustment. Including this adjustment, the total gain on sale of discontinued operations was $176.1 million for the three months ended March 31, ~~2021.~~

Three Months Ended September 30, Nine Months Ended September 30,
(in thousands) 2022 2021 2022 2021
Revenues:
Leasing and services revenue:
Leasing $ 22,432 $ 20,797 $ 65,572 $ 56,343
Delivery and installation 10,121 7,789 27,665 21,969
Sales revenue:
New units 842 490 2,202 1,908
Rental units 593 429 917 1,123
Total revenues 33,988 29,505 96,356 81,343
Costs:
Costs of leasing and services:
Leasing 4,913 4,481 13,828 12,628
Delivery and installation 8,634 6,770 23,285 18,317
Costs of sales:
New units 633 324 1,636 1,338
Rental units 238 135 310 429
Depreciation of rental equipment 1,822 3,472 8,145 10,026
Gross profit 17,748 14,323 49,152 38,605
Expenses:
Selling, general and administrative 5,544 6,381 18,045 16,792
Other depreciation and amortization 1,274 2,355 6,103 6,967
Other (expense) income, net (16) 1 4 7
Operating income 10,946 5,586 25,000 14,839
Interest expense 144 195 512 584
Income from discontinued operations before income tax 10,802 5,391 24,488 14,255
Income tax expense from discontinued operations 1,986 1,401 5,496 3,612
Income from discontinued operations $ 8,816 $ 3,990 $ 18,992 $ 10,643
Other selected data:
Adjusted EBITDA $ 13,048 $ 10,946 $ 37,016 $ 29,870
2023.

119


	Three Months Ended March 31, 2022
(in thousands)	Tank and Pump		UK Storage Solutions		Total
Revenues:
Leasing and services revenue:
Leasing	$	21,062	$	20,571	$	41,633
Delivery and installation	8,325		6,467		14,792
Sales revenue:
New units	682		128		810
Rental units	214		274		488
Total revenues	30,283		27,440		57,723
Costs:
Costs of leasing and services:
Leasing	4,307		4,237		8,544
Delivery and installation	7,011		3,924		10,935
Costs of sales:
New units	507		63		570
Rental units	95		157		252
Depreciation of rental equipment	3,530		1,138		4,668
Gross profit	14,833		17,921		32,754
Expenses:
Selling, general and administrative	6,212		6,117		12,329
Other depreciation and amortization	2,416		1,825		4,241

Currency losses, net	—		1		1
Other expense (income), net	19		(45)		(26)
Operating income	6,186		10,023		16,209
Interest expense	178		244		422
Income from discontinued operations before income tax	6,008		9,779		15,787
Income tax expense from discontinued operations	1,513		2,151		3,664
Income from discontinued operations	$	4,495	$	7,628	$	12,123
Other selected data:
Adjusted EBITDA from discontinued operations	$	11,506	$	12,544	$	24,050


	December 31, 2022
(in thousands)	~~December 31, 2021~~UK Storage Solutions

Assets
Cash and cash equivalents	$	10,384
Trade receivables, net of allowances for doubtful accounts of ~~$1,469~~$300	$		~~31,031~~15,991
Inventories	~~647~~3,058
Prepaid expenses and other current assets	~~222~~1,787
Rental ~~Equipment,~~equipment, net	~~134,973~~165,853
Property, plant and equipment, net	~~29,931~~20,645
Operating lease assets	~~11,720~~15,134
Goodwill	~~100,107~~58,144
Intangible assets, net	~~8,750~~6,414
Other non-current assets	551,832
Total assets held for sale	$	~~317,436~~299,242
Liabilities
Accounts payable	$	~~8,001~~4,515
Accrued expenses	~~4,603~~3,273
Accrued employee benefits	~~2,487~~1,009
Deferred revenue and customer deposits	276,850
Deferred tax liabilities	~~17,095~~29,737
Operating lease liabilities	~~11,959~~15,192
Other non-current liabilities	~~23,487~~6,278
Total liabilities held for sale	$	~~67,659~~66,854

~~At December 31, 2021, assets held for sale of $1.0 million were not related to the Tank and Pump business and were excluded from the table above.~~

For the ~~nine~~three months ended ~~September 30,~~March 31, 2022 ~~and 2021,~~, significant operating and investing items related to the former Tank and Pump ~~business~~segment were as follows:

Nine Months Ended September 30,
(in thousands) 2022 2021
Operating activities of discontinued operations:
Depreciation and amortization $ 14,248 $ 16,993
Investing activities of discontinued operations:
Proceeds from sale of rental equipment $ 917 $ 1,123
Purchase of rental equipment and refurbishments $ (19,064) $ (11,093)
Proceeds from sale of property, plant and equipment $ — $ 170
Purchase of property, plant and equipment $ (403) $ (1,220)


	Three Months Ended March 31,
(in thousands)	2022
Operating activities of discontinued operations:
Depreciation and amortization	$	5,946
Investing activities of discontinued operations:
Proceeds from sale of rental equipment	$	214
Purchases of rental equipment and refurbishments	$	(7,873)

Purchases of property, plant and equipment	$	(82)

1211

The following table presents a reconciliation of Income from discontinued operations before income tax to Adjusted EBITDA from discontinued operations for the former Tank and Pump segment for the three months ended March 31, 2022. See Note 16 for further information regarding Adjusted EBITDA.


	Three Months Ended March 31,
(in thousands)	2022
Income from discontinued operations	$	4,495

Income tax expense from discontinued operations	1,513
Income from discontinued operations before income tax	6,008
Interest expense	178
Depreciation and amortization	5,946




Stock compensation expense	104
Other	(730)
Adjusted EBITDA from discontinued operations	$	11,506

For the three months ended March 31, 2023 and 2022, significant operating and investing items related to the former UK Storage Solutions segment were as follows:


	Three Months Ended March 31,
(in thousands)	2023		2022
Operating activities of discontinued operations:
Depreciation and amortization	$	—	$	2,963
Investing activities of discontinued operations:
Proceeds from sale of rental equipment	$	514	$	274
Purchases of rental equipment and refurbishments	$	(371)	$	(9,615)
Proceeds from sale of property, plant and equipment	$	8	$	255
Purchases of property, plant and equipment	$	(64)	$	(2,265)

The following table presents reconciliations of Income from discontinued operations before income tax to Adjusted EBITDA from discontinued operations for the ~~Tank and Pump business~~former UK Storage Solutions segment for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively. See Note 1816 for further information regarding Adjusted EBITDA.


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
(in thousands)	(in thousands)	2022		2021		2022		2021		(in thousands)	2023		2022
Income from discontinued operations before income tax		$	10,802	$	5,391	$	24,488	$	14,255
Income from discontinued operations										Income from discontinued operations	$	134,243	$	7,628
Gain on sale of discontinued operations										Gain on sale of discontinued operations	175,708		—
Income tax expense from discontinued operations										Income tax expense from discontinued operations	45,468		2,151
Income from discontinued operations before income tax and gain on sale										Income from discontinued operations before income tax and gain on sale	4,003		9,779
Interest expense										Interest expense	56		244
Depreciation and amortization										Depreciation and amortization	—		2,963
Currency losses, net										Currency losses, net	—		1

Interest expense		144		195		512		584
Depreciation and amortization		3,096		5,828		14,248		16,993

Restructuring costs, lease impairment expense and other related charges		—		—		—		2

Integration costs		—		5		—		5
Stock compensation expense	Stock compensation expense	(221)		102		18		175		Stock compensation expense	(196)		18
Other	Other	(773)		(575)		(2,250)		(2,144)		Other	261		(461)
Adjusted EBITDA from discontinued operations	Adjusted EBITDA from discontinued operations	$	13,048	$	10,946	$	37,016	$	29,870	Adjusted EBITDA from discontinued operations	$	4,124	$	12,544

NOTE 4 - Revenue

Revenue Disaggregation

Geographic Areas

The Company had total revenue in the following geographic areas for the three ~~and nine~~ months ended ~~September 30, 2022 and 2021~~March 31, as follows:


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
(in thousands)	(in thousands)	2022		2021		2022		2021		(in thousands)	2023		2022
US	US	$	538,737	$	399,590	$	1,445,709	$	1,121,627	US	$	533,174	$	421,684
Canada	Canada	34,815		29,692		92,989		79,493		Canada	26,941		25,273
Mexico	Mexico	4,453		3,666		13,370		10,977		Mexico	5,353		4,214
UK		26,168		28,099		80,271		83,537
Total revenues	Total revenues	$	604,173	$	461,047	$	1,632,339	$	1,295,634	Total revenues	$	565,468	$	451,171

Major Product and Service Lines

Equipment leasing is the Company's core business and the primary driver of the Company's revenue and cash flows. This includes modular space and portable storage units along with value-added products and services ("VAPS"), which include furniture, steps, ramps, basic appliances, internet connectivity devices, ~~security~~integral tool racking, heavy duty capacity shelving, workstations, electrical and lighting products ~~shelving systems~~ and other items used by customers in connection with the Company's products. The Company also offers its lease customers a damage waiver program that protects them in case the leased unit is damaged. Leasing is complemented by new unit sales and sales of rental units. In connection with its leasing and sales activities, the Company provides services including delivery and installation, maintenance and ad hoc services and removal services at the end of lease transactions.

The Company’s revenue by major product and service line for the three ~~and nine~~ months ended ~~September 30, 2022 and 2021~~March 31, was as follows:


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
(in thousands)	(in thousands)	2022		2021		2022		2021		(in thousands)	2023		2022
Modular space leasing revenue	Modular space leasing revenue	$	226,261	$	188,507	$	638,273	$	539,836	Modular space leasing revenue	$	224,470	$	190,390
Portable storage leasing revenue	Portable storage leasing revenue	103,503		66,184		269,964		179,645		Portable storage leasing revenue	97,315		70,703
VAPS and third party leasing revenues(a)	VAPS and third party leasing revenues(a)	96,220		72,293		261,964		203,493		VAPS and third party leasing revenues(a)	94,126		75,305
Other leasing-related revenue(b)	Other leasing-related revenue(b)	21,551		15,615		56,005		42,920		Other leasing-related revenue(b)	24,040		15,161
Leasing revenue	Leasing revenue	447,535		342,599		1,226,206		965,894		Leasing revenue	439,951		351,559
Delivery and installation revenue	Delivery and installation revenue	132,837		91,910		341,027		252,914		Delivery and installation revenue	106,630		85,539
Total leasing and services revenue	Total leasing and services revenue	580,372		434,509		1,567,233		1,218,808		Total leasing and services revenue	546,581		437,098
New unit sales revenue	New unit sales revenue	9,901		15,370		26,232		35,915		New unit sales revenue	10,657		5,787
Rental unit sales revenue	Rental unit sales revenue	13,900		11,168		38,874		40,911		Rental unit sales revenue	8,230		8,286
Total revenues	Total revenues	$	604,173	$	461,047	$	1,632,339	$	1,295,634	Total revenues	$	565,468	$	451,171


(a)			Includes ~~$8.8~~$5.6 million and ~~$7.2~~$5.9 million of service revenue for the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021, respectively, and $23.1 million and $21.2 million of service revenue for the nine months ended September 30, 2022 and 2021,~~ respectively.
(b)			Includes primarily damage billings, delinquent payment charges, and other processing fees.

Leasing and Services Revenue

The majority of ~~revenue (73% and 74%~~revenue (77% for the ~~three and nine months ended September 30, 2022, respectively, and 73% for~~ both the three ~~and nine~~ months ended ~~September 30, 2021)~~March 31, 2023 and March 31, 2022) was generated by rental income subject to the guidance of ASU 2018-11, Leases (Topic 842) ("ASC 842"). The remaining revenue was generated by performance obligations in contracts with customers for services or sale of units subject to the guidance in ASC 606.

Receivables and Credit Losses

The Company is exposed to credit losses from trade receivables and manages credit risk at the customer level. Because the same customers generate the revenues that are accounted for under both ASC 606 and ASC 842, the discussions below on credit risk and the Company's allowance for credit losses address the Company's total revenues. Concentration of credit risk with respect to the Company's receivables is limited because of a large number of geographically diverse customers who operate in a variety of end user markets.

The Company assesses each customer’s ability to pay for the products it leases or sells by conducting a credit review that considers expected billing exposure, timing for payment and the customer’s established credit rating. The Company performs its credit review of new customers at inception of the customer relationship and for existing customers when the

customer transacts after a defined period of dormancy. The Company also considers contract terms and conditions, country risk and business strategy in the evaluation.

The Company monitors ongoing credit exposure through an active review of customer balances against contract terms and due ~~dates. The Company~~dates and may employ collection agencies and legal counsel to pursue recovery of defaulted receivables. The allowance for credit losses reflects the estimate of the amount of receivables that the Company will be unable to collect based on historical collection experience and, as applicable, current conditions and reasonable and supportable forecasts that affect collectability. The Company's estimate reflects changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, the Company may be required to increase or decrease its allowance.

Activity in the allowance for credit losses was as follows:

Three Months Ended September 30, Nine Months Ended September 30,
(in thousands) 2022 2021 2022 2021
Balance at beginning of period $ 50,720 $ 35,608 $ 46,160 $ 28,442
Provision for credit losses, net of recoveries 9,977 8,292 27,487 24,839
Write-offs (4,474) (4,541) (17,384) (14,411)
Foreign currency translation and other (96) (126) (136) 363
Balance at end of period $ 56,127 $ 39,233 $ 56,127 $ 39,233


	Three Months Ended March 31,
(in thousands)	2023		2022
Balance at beginning of period	$	57,048	$	45,773
Provision for credit losses, net of recoveries	8,803		8,311
Write-offs	(4,537)		(7,010)
Foreign currency translation and other	88		50
Balance at end of period	$	61,402	$	47,124

Contract Assets and Liabilities

When customers are billed in advance for services, the Company defers recognition of revenue until the related services are performed, which generally occurs at the end of the contract. The balance sheet classification of deferred revenue is determined based on the contractual lease term. For contracts that continue beyond their initial contractual lease term, revenue continues to be deferred until the services are performed. During the three months ended ~~September 30, 2022,~~March 31, 2023, deferred revenue relating to services billed in advance of $~~24.5~~27.7 million was recognized as revenue. As of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, the Company had approximately $~~107.9~~99.0 million and $~~79.4~~102.2 million, respectively, of deferred revenue related to these services.

The Company does not have material contract assets, and the Company's uncompleted contracts with customers have unsatisfied (or partially satisfied) performance obligations. For the future services revenues that are expected to be recognized within twelve months, the ~~Company~~Company has elected to utilize the optional disclosure exemption made available regarding transaction price allocated to unsatisfied (or partially unsatisfied) performance obligations. The transaction price for performance obligations that will be completed in greater than twelve months is variable based on the ~~costs ultimately incurred to provide~~market rate in place at the time those services are provided, and therefore, the Company is applying the optional expedient to omit disclosure of such amounts.

The primary costs to obtain contracts ~~for~~for new and rental unit sales with the Company's customers are commissions. The Company pays its sales force commissions on the sale of new and rental units. For new and rental unit sales, the period benefited by each commission is less than one year; therefore, the commissions are expensed as incurred.

NOTE 5 - Leases

As of ~~September 30, 2022,~~March 31, 2023, the undiscounted future lease payments for operating and finance lease liabilities were as follows:

(in thousands) Operating Finance
2022 (remaining) $ 15,803 $ 3,501
2023 58,926 15,226
2024 49,583 13,523
2025 41,080 13,197
2026 30,330 12,809
Thereafter 69,011 22,052
Total lease payments 264,733 80,308
Less: interest (37,985) (7,460)
Present value of lease liabilities $ 226,748 $ 72,848


(in thousands)	Operating		Finance
2023 (remaining)	$	46,323	$	12,694
2024	54,591		15,259
2025	45,588		14,932
2026	33,680		14,618
2027	22,750		11,372
Thereafter	57,028		20,080
Total lease payments	259,960		88,955
Less: interest	(38,970)		(9,090)
Present value of lease liabilities	$	220,990	$	79,865

Finance lease liabilities are included within long-term debt and current portion of long-term debt on the condensed consolidated balance sheets.

1514

The Company’s lease activity during the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 and ~~2021~~2022 was as follows:

(in thousands) Nine Months Ended September 30,
Financial Statement Line 2022 2021
Finance Lease Expense
Amortization of finance lease assets $ 11,034 $ 9,538
Interest on obligations under finance leases 1,504 1,072
Total finance lease expense $ 12,538 $ 10,610
Operating Lease Expense
Fixed lease expense
Costs of leasing and services $ 2,242 $ 3,019
Selling, general and administrative 46,580 42,494
Lease impairment expense and other related charges 213 1,571
Short-term lease expense
Costs of leasing and services 24,122 17,751
Selling, general and administrative 1,466 615
Variable lease expense
Costs of leasing and services 3,989 5,442
Selling, general and administrative 5,951 5,332
Lease impairment expense and other related charges 40 402
Total operating lease expense $ 84,603 $ 76,626

Lease impairment expense and other related charges relate to closed locations that are no longer used in operations as a result of consolidation activities within the Company. During the nine months ended September 30, 2022, the Company recorded $0.3 million in lease impairment expense and other related charges which is comprised of closed location rent expense. During the nine months ended September 30, 2021, the Company recorded $2.3 million in lease impairment expense and other related charges which is comprised of $2.0 million in closed location rent expense and $0.3 million loss on lease exit and impairment charges.


(in thousands)	Three Months Ended March 31,
Financial Statement Line	2023		2022
Finance Lease Expense
Amortization of finance lease assets	$	3,761	$	3,333
Interest on obligations under finance leases	759		429
Total finance lease expense	$	4,520	$	3,762

Operating Lease Expense
Fixed lease expense
Cost of leasing and services	$	420	$	825
Selling, general and administrative	15,717		14,930

Short-term lease expense
Cost of leasing and services	6,654		8,862
Selling, general and administrative	462		668

Variable lease expense
Cost of leasing and services	1,026		1,287
Selling, general and administrative	2,474		1,767

Total operating lease expense	$	26,753	$	28,339

Supplemental cash flow information related to leases for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 and ~~2021~~2022 was as follows:


(in thousands)	(in thousands)	Nine Months Ended September 30,				(in thousands)	Three Months Ended March 31,
Supplemental Cash Flow Information	Supplemental Cash Flow Information	2022		2021		Supplemental Cash Flow Information	2023		2022
Cash paid for the amounts included in the measurement of lease liabilities:	Cash paid for the amounts included in the measurement of lease liabilities:					Cash paid for the amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	Operating cash outflows from operating leases	$	48,309	$	46,509	Operating cash outflows from operating leases	$	16,693	$	15,753
Operating cash outflows from finance leases	Operating cash outflows from finance leases	$	1,502	$	1,067	Operating cash outflows from finance leases	$	728	$	412
Financing cash outflows from finance leases	Financing cash outflows from finance leases	$	12,868	$	9,011	Financing cash outflows from finance leases	$	3,446	$	3,848

Right of use assets obtained in exchange for lease obligations	Right of use assets obtained in exchange for lease obligations	$	37,771	$	41,209	Right of use assets obtained in exchange for lease obligations	$	8,741	$	8,794
Assets obtained in exchange for finance leases	Assets obtained in exchange for finance leases	$	22,414	$	17,184	Assets obtained in exchange for finance leases	$	8,913	$	5,411

~~Weighted-average~~Weighted average remaining operating lease terms and the weighted average discount rates as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021~~2022 were as follows:

Lease Terms and Discount Rates September 30, 2022 December 31, 2021
Weighted-average remaining lease term - operating leases 5.9 years 6.1 years
Weighted-average discount rate - operating leases 5.1 % 5.0 %
Weighted-average remaining lease term - finance leases 5.1 years 4.9 years
Weighted-average discount rate - finance leases 3.2 % 2.8 %


Lease Terms and Discount Rates	March 31, 2023		December 31, 2022
Weighted average remaining lease term - operating leases	5.7 years		5.8 years
Weighted average discount rate - operating leases	5.5	%	5.4	%
Weighted average remaining lease term - finance leases	5.0 years		5.1 years
Weighted average discount rate - finance leases	3.5	%	3.4	%

The Company presents information related to leasing revenues in Note 4.

NOTE 6 - Inventories

Inventories at the respective balance sheet dates consisted of the following:


(in thousands)	(in thousands)	September 30, 2022		December 31, 2021		(in thousands)	March 31, 2023		December 31, 2022
Raw materials	Raw materials	$	38,720	$	26,340	Raw materials	$	38,827	$	38,611
Finished units	Finished units	6,153		5,752		Finished units	3,180		2,419
Inventories	Inventories	$	44,873	$	32,092	Inventories	$	42,007	$	41,030

NOTE 7 - Rental Equipment, net

Rental equipment, net at the respective balance sheet dates consisted of the following:


(in thousands)	(in thousands)	September 30, 2022		December 31, 2021		(in thousands)	March 31, 2023		December 31, 2022
Modular space units	Modular space units	$	3,254,022	$	3,005,195	Modular space units	$	3,292,264	$	3,197,779
Portable storage units	Portable storage units	898,275		758,619		Portable storage units	848,982		849,193
Value added products	Value added products	198,494		168,358		Value added products	202,358		203,444
Total rental equipment	Total rental equipment	4,350,791		3,932,172		Total rental equipment	4,343,604		4,250,416
Less: accumulated depreciation	Less: accumulated depreciation	(1,123,056)		(986,164)		Less: accumulated depreciation	(1,215,543)		(1,173,129)
Rental equipment, net	Rental equipment, net	$	3,227,735	$	2,946,008	Rental equipment, net	$	3,128,061	$	3,077,287

NOTE 8 - Goodwill and Intangibles

Goodwill

Changes in the carrying amount of goodwill were as follows:

(in thousands) NA Modular NA Storage UK Storage Total
Balance at December 31, 2020 $ 235,828 $ 726,529 $ 65,600 $ 1,027,957
Changes to Mobile Mini purchase accounting 285,000 (233,666) — 51,334
Effects of movements in foreign exchange rates 221 (311) (502) (592)
Balance at December 31, 2021 521,049 492,552 65,098 1,078,699
Effects of movements in foreign exchange rates (2,766) — (11,351) (14,117)
Balance at September 30, 2022 $ 518,283 $ 492,552 $ 53,747 $ 1,064,582


(in thousands)	Modular		Storage		Total
Balance at December 31, 2021	$	521,049	$	492,552	$	1,013,601
Effects of movements in foreign exchange rates	(2,172)		—		(2,172)
Balance at December 31, 2022	518,877		492,552		1,011,429
Effects of movements in foreign exchange rates	84		—		84
Balance at March 31, 2023	$	518,961	$	492,552	$	1,011,513

The Company had no goodwill impairment during the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 or the year ended December 31, ~~2021.~~2022.

~~NOTE 9 - Intangibles~~Intangible Assets

Intangible assets other than goodwill at the respective balance sheet dates consisted of the following:


		September 30, 2022								March 31, 2023
(in thousands)	(in thousands)	Weighted average remaining life (in years)	Gross carrying amount		Accumulated amortization		Net book value		(in thousands)	Weighted average remaining life (in years)	Gross carrying amount		Accumulated amortization		Net book value
Intangible assets subject to amortization:	Intangible assets subject to amortization:								Intangible assets subject to amortization:

Mobile Mini customer relationships	Mobile Mini customer relationships	5.7	$	199,000	$	(57,646)	$	141,354	Mobile Mini customer relationships	5.3	$	188,000	$	(64,625)	$	123,375
Technology	Technology	3.8	1,500		(563)		937		Technology	3.3	1,500		(687)		813
Indefinite-lived intangible assets:	Indefinite-lived intangible assets:								Indefinite-lived intangible assets:
Trade name - Mobile Mini	Trade name - Mobile Mini		164,000		—		164,000		Trade name - Mobile Mini		164,000		—		164,000
Trade name - WillScot	Trade name - WillScot		125,000		—		125,000		Trade name - WillScot		125,000		—		125,000
Total intangible assets other than goodwill	Total intangible assets other than goodwill		$	489,500	$	(58,209)	$	431,291	Total intangible assets other than goodwill		$	478,500	$	(65,312)	$	413,188

1716


		December 31, 2021								December 31, 2022
(in thousands)	(in thousands)	Weighted average remaining life (in years)	Gross carrying amount		Accumulated amortization		Net book value		(in thousands)	Weighted average remaining life (in years)	Gross carrying amount		Accumulated amortization		Net book value
Intangible assets subject to amortization:	Intangible assets subject to amortization:								Intangible assets subject to amortization:

Mobile Mini customer relationships	Mobile Mini customer relationships	6.6	$	199,000	$	(37,197)	$	161,803	Mobile Mini customer relationships	5.5	$	188,000	$	(58,750)	$	129,250
Technology	Technology	4.5	1,500		(375)		1,125		Technology	3.5	1,500		(625)		875
Indefinite-lived intangible assets:	Indefinite-lived intangible assets:								Indefinite-lived intangible assets:
Trade name - Mobile Mini	Trade name - Mobile Mini		164,000		—		164,000		Trade name - Mobile Mini		164,000		—		164,000
Trade name - WillScot	Trade name - WillScot		125,000		—		125,000		Trade name - WillScot		125,000		—		125,000
Total intangible assets other than goodwill	Total intangible assets other than goodwill		$	489,500	$	(37,572)	$	451,928	Total intangible assets other than goodwill		$	478,500	$	(59,375)	$	419,125

Amortization expense related to intangible assets was ~~$6.0~~$5.9 million ~~and $6.6 million~~ for the each of the three months ended ~~September 30, 2022~~March 31, 2023 and ~~2021, respectively, and $19.2 million and $20.0 million~~ ~~for~~ ~~the nine months ended September 30, 2022 and 2021, respectively.~~2022.

Based on the carrying value at ~~September 30, 2022,~~March 31, 2023, future amortization of intangible assets is expected to be as follows for the years ended December 31:


(in thousands)	(in thousands)			(in thousands)
2022 (remaining)		$	6,583
2023		25,583
2023 (remaining)				2023 (remaining)	$	17,813
2024	2024	25,583		2024	23,750
2025	2025	25,583		2025	23,750
2026	2026	23,897		2026	23,625
2027				2027	23,500
Thereafter	Thereafter	35,062		Thereafter	11,750
Total	Total	$	142,291	Total	$	124,188

NOTE 109 - Debt

The carrying value of debt outstanding at the respective balance sheet dates consisted of the following:


(in thousands, except rates)	(in thousands, except rates)	Interest rate	Year of maturity	September 30, 2022		December 31, 2021		(in thousands, except rates)	Interest rate	Year of maturity	March 31, 2023		December 31, 2022
2025 Secured Notes	2025 Secured Notes	6.125%	2025	$	519,778	$	518,117	2025 Secured Notes	6.125%	2025	$	520,931	$	520,350
ABL Facility(a)	ABL Facility(a)	Varies	2027	1,863,451		1,612,783		ABL Facility(a)	Varies	2027	1,795,448		1,988,176
2028 Secured Notes	2028 Secured Notes	4.625%	2028	493,220		492,490		2028 Secured Notes	4.625%	2028	493,723		493,470
Finance Leases	Finance Leases	Varies	Varies	72,848		65,563		Finance Leases	Varies	Varies	79,865		74,370
Total debt	Total debt			2,949,297		2,688,953		Total debt			2,889,967		3,076,366
Less: current portion of long-term debt	Less: current portion of long-term debt			13,497		11,968		Less: current portion of long-term debt			13,514		13,324
Total long-term debt	Total long-term debt			$	2,935,800	$	2,676,985	Total long-term debt			$	2,876,453	$	3,063,042

(a) As of both ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, the Company had no outstanding principal borrowings on the ~~multicurrency revolving credit facility~~Multicurrency Facility and ~~$4.4~~ $2.4 million and ~~$6.2~~$2.5 million, respectively, of related debt issuance costs. No related debt issuance costs were recorded as a direct offset against the principal borrowings on the Multicurrency Facility, and the ~~$4.4~~ $2.4 million and ~~$6.2~~$2.5 million in excess of principal was included in other non-current assets on the condensed consolidated balance sheets as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, respectively.

Asset Backed Lending Facility

On July 1, 2020, certain subsidiaries of the Company entered into an asset-based credit agreement (the "ABL Facility") that initially provided for revolving credit facilities in the aggregate principal amount of up to $2.4 billion, consisting of: (i) a senior secured asset-based US dollar revolving credit facility in the aggregate principal amount of $2.0 billion and (ii) a $400.0 million senior secured asset-based multicurrency revolving credit facility available to be drawn in US Dollars, Canadian Dollars, British Pounds Sterling or Euros. The ABL Facility was initially scheduled to mature on July 1, 2025.

Borrowings under ABL Facility bear interest at a base rate plus an applicable margin determined quarterly by reference to the Company's excess availability for the most recently completed quarter. Effective January 7, 2022, borrowings were subject to the highest applicable margin and bore interest at (i) in the case of US Dollars, at the borrower's option, either an adjusted LIBOR rate plus 2.125% or an alternative base rate plus 1.125%, (ii) in the case of Canadian Dollars, at the borrower's option, either a Canadian BA rate plus 2.125% or Canadian prime rate plus 1.125%, (iii) in the case of Euros, the EURIBOR rate plus 2.125%, and (iv) in the case of British Pounds Sterling, the SONIA rate plus 2.125%.

On June 30, 2022, certain subsidiaries of the Company entered into an amendment to the ABL Facility to, among other things, extend the expiration date until June 30, 2027 and increase the aggregate principal amount of the revolving credit facilities to $3.7 billion, consisting of: (i) a senior secured asset-based US dollar revolving credit facility in the aggregate principal amount of $3.3 billion (the “US Facility”) and (ii) a $400.0 million senior secured asset-based multicurrency revolving credit facility (the "Multicurrency Facility"), available to be drawn in US Dollars, Canadian Dollars, British Pounds Sterling or ~~Euros.~~

Euros. The amendment also converted the interest rate for borrowings denominated in US ~~dollars~~Dollars from a LIBOR-based rate to a ~~Term SOFR-based~~Term-SOFR-based rate with an interest period of one month and adjusted the applicable margins. The applicable margin for Canadian BA rate, Term SOFR, British Pounds Sterling and Euros loans is 1.50%. The facility includes a credit spread adjustment of 0.10% in addition to the applicable margin. The applicable margin for base rate and Canadian Prime Rate loans is 0.50%. The applicable margins are subject to one step down of 0.25% based on excess availability or one step up of 0.25% based on the Company's leverage ratio. The ABL Facility requires the payment of ~~an annual~~a commitment fee on the unused available borrowings of 0.20% annually. ~~At September 30, 2022, the~~The weighted average interest rate on the balance outstanding as of March 31, 2023, as adjusted for ~~borrowings under~~ the ~~ABL Facility~~effects of the interest rate swap agreements, was ~~4.46%~~6.52%. Refer to Note 12 for a more detailed discussion on interest rate management.

Borrowing availability under the US Facility and the Multicurrency Facility is equal to the lesser of (i) the aggregate Revolver Commitments and (ii) the Borrowing Base ("Line ~~Cap.~~Cap"). At ~~September 30, 2022, the Company had $1.9 billion outstanding principal under the ABL Facility,~~March 31, 2023, the Line Cap was $3.0 billion and the ~~Company~~Borrowers had $1.1 billion of available borrowing capacity under the ABL Facility, including ~~$821.3~~$972.5 million under the US Facility and ~~$292.1~~$162.0 million under the Multicurrency Facility. ~~At September 30, 2022, borrowing~~Borrowing capacity under the ABL Facility ~~allowed~~is made available for up to ~~$204.9~~$205.6 million of letters of credit and up to ~~$220.0~~$200.5 million of swingline loans. At March 31, 2023, letters of credit and bank guarantees carried fees of 1.625%. The Company had issued ~~$15.1~~$14.4 million of standby letters of credit under the ABL Facility at ~~September 30, 2022. At September 30, 2022, letters of credit and bank guarantees carried fees of 1.625% annually.~~March 31, 2023.

The Company had approximately $1.8 billion outstanding principal under the ABL Facility at March 31, 2023. Debt issuance costs of ~~$33.6~~$30.1 million were included in the carrying value of the ABL Facility at ~~September 30, 2022.~~March 31, 2023.

Finance Leases

The Company maintains finance leases primarily related to transportation equipment. At ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, obligations under finance leases for certain real property and transportation related equipment were ~~$72.8~~$79.9 million and ~~$65.6~~$74.4 million, respectively. Refer to Note 5 for further information.

The Company iswas in compliance with all debt covenants and restrictions ~~for the aforementioned~~associated with its debt instruments as of ~~September 30, 2022.~~March 31, 2023.

NOTE 1110 – Equity

Common Stock

In connection with the stock compensation vesting events and stock option exercises described in Note ~~15, and the warrant exercises described in Note 12,~~14, the Company issued ~~1,860,778~~ 360,725 shares of Common Stock during the ~~nine~~three months ended ~~September 30, 2022.~~March 31, 2023.

Stock Repurchase Program

In July 2022, the ~~Company's~~ Board of Directors approved an increase to the share repurchase program ~~that authorizes~~authorizing the Company to repurchase up to $1.0 billion of its outstanding shares of Common Stock and equivalents. The stock repurchase program does not obligate the Company 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.

In August 2022, the Inflation Reduction Act of 2022 was enacted into law and imposed a nondeductible 1% excise tax on the net value of certain stock repurchases made after December 31, 2022. In the first quarter of 2023, the Company reflected the applicable excise tax in equity as part of the cost basis of the stock repurchased and recorded a corresponding liability for the excise taxes payable in accrued expenses on the consolidated balance sheet.

During the ~~nine~~three months ended ~~September 30, 2022, t~~March 31, 2023he, the Company repurchased ~~14,575,160~~4,589,308 shares of Common Stock ~~and stock equivalents~~ for ~~$524.4 million.~~$215.7 million, excluding excise tax. As of ~~September 30, 2022, $863.3~~March 31, 2023, $415.1 million of the approved share repurchase ~~amount~~pool remained available.

Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive income (loss) ("AOCI"), net of tax, for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ were as follows:

Nine Months Ended September 30, 2022
(in thousands) Foreign currency translation Unrealized losses on hedging activities Total
Balance at December 31, 2021 $ (25,574) $ (3,497) $ (29,071)
Other comprehensive loss before reclassifications (4,074) (569) (4,643)
Reclassifications from AOCI to income — 2,890 2,890
Balance at March 31, 2022 (29,648) (1,176) (30,824)
Other comprehensive loss before reclassifications (25,628) (464) (26,092)
Reclassifications from AOCI to income — 1,640 1,640
Balance at June 30, 2022 (55,276) — (55,276)
Other comprehensive loss (37,733) — (37,733)
Balance at September 30, 2022 $ (93,009) $ — $ (93,009)


	Three Months Ended March 31, 2023
(in thousands)	Foreign currency translation		Unrealized losses on hedging activities		Total
Balance at December 31, 2022	$	(70,122)	$	—	$	(70,122)
Other comprehensive income (loss) before reclassifications	7,934		859		8,793
Reclassifications from AOCI to income	—		(1,526)		(1,526)
Balance at March 31, 2023	$	(62,188)	$	(667)	$	(62,855)

Nine Months Ended September 30, 2021
(in thousands) Foreign currency translation Unrealized losses on hedging activities Total
Balance at December 31, 2020 $ (24,694) $ (12,513) $ (37,207)
Other comprehensive income (loss) before reclassifications 5,034 (760) 4,274
Reclassifications from AOCI to income — 2,937 2,937
Balance at March 31, 2021 (19,660) (10,336) (29,996)
Other comprehensive income (loss) before reclassifications 3,093 (848) 2,245
Reclassifications from AOCI to income — 2,994 2,994
Balance at June 30, 2021 (16,567) (8,190) (24,757)
Other comprehensive income before reclassifications (11,162) (830) (11,992)
Reclassifications from AOCI to income — 3,036 3,036
Balance at September 30, 2021 $ (27,729) $ (5,984) $ (33,713)


	Three Months Ended March 31, 2022
(in thousands)	Foreign currency translation		Unrealized losses on hedging activities		Total
Balance at December 31, 2021	$	(25,574)	$	(3,497)	$	(29,071)
Other comprehensive loss before reclassifications	(4,074)		(569)		(4,643)
Reclassifications from AOCI to income	—		2,890		2,890
Balance at March 31, 2022	$	(29,648)	$	(1,176)	$	(30,824)

For the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and~~, a gain of $1.5 million ~~2021, $4.5~~and a loss of $2.9 million ~~and $9.0 million,~~, respectively, ~~was~~were reclassified from AOCI into ~~interest expense in~~ the condensed consolidated statements of operations within interest expense related to the interest rate ~~swap~~swaps discussed in Note ~~16. Associated with these reclassifications, the~~12. The Company recorded tax benefit of $0.4 million and tax expense of $0.7 million for the three months ended ~~September 30, 2021,~~March 31, 2023 and ~~$1.1 million and $2.0 million for the nine months ended September 30,~~ 2022 ~~and 2021, respectively. The interest rate swap terminated on May 29, 2022.~~, respectively, associated with these reclassifications.

NOTE ~~12 – Warrants~~

~~2015 Warrants~~

WillScot was incorporated under the name Double Eagle Acquisition Corporation ("DEAC") on June 26, 2015. DEAC issued warrants to purchase its Common Stock in a private placement concurrently with its initial public offering (the “2015 Private Warrants”) each of which entitled the holder to purchase one-half of one share of Common Stock. During the six months ended June 30, 2021, 3,055,000 of the 2015 Private Warrants were repurchased for $25.5 million and cancelled. In addition, during the six months ended June 30, 2021, 9,655,000 warrants were exercised on a cashless basis, resulting in the issuance of 2,939,898 shares of Common Stock. As of June 30, 2021, no 2015 Private Warrants remained outstanding.

~~2018 Warrants~~

In connection with the Modular Space Holdings acquisition in 2018, WillScot issued warrants to purchase approximately 10.0 million shares of Common Stock (the "2018 Warrants") to former shareholders. Each 2018 Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $15.50 per share, subject to adjustment. The 2018 Warrants expire on November 29, 2022. During the nine months ended September 30, 2022, 33,965 of the 2018 Warrants were repurchased for $0.6 million and cancelled. In addition, during the nine months ended September 30, 2022, 1,037,379 of the 2018 Warrants were exercised on a cashless basis, resulting in the issuance of 631,863 shares of common stock. At September 30, 2022, 3,006,829 of the 2018 Warrants were outstanding.

The Company accounted for its warrants in the following ways: (i) the 2015 Private Warrants as liabilities through their final repurchase or exercise in May 2021, and (ii) the 2018 Warrants as liabilities until June 30, 2020 after which they are accounted for as equity instruments. Warrants classified as liabilities were subject to remeasurement at each balance sheet date and transaction date with changes in the estimated fair values of the common stock warrant liabilities and gains and losses on extinguishment of common stock warrant liabilities reported in the consolidated statements of operations.

~~NOTE 13~~11 – Income Taxes

The Company recorded ~~$30.2~~$30.5 million and ~~$67.2~~$12.1 million of income tax expense from continuing operations for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022, ~~respectively, and $5.2 million and $32.4 million of income tax expense for the three and nine months ended September 30, 2021,~~ respectively. The Company’s effective tax rate for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022 was ~~26.1%~~28.6% and ~~25.1%, respectively. The Company's effective tax rate for the three and nine months ended September 30, 2021 was 8.4% and 30.1%~~23.7%, respectively.

The effective tax rate for the three ~~and nine~~ months ended ~~September 30, 2022 differed~~March 31, 2023 differs from the US federal statutory rate of 21% primarily due to state and provincial taxes and an add-back for non-deductible executive compensation. The effective tax rate for the three months ended March 31, 2022 differs from the US statutory rate of 21% primarily due to state and provincial taxes offset by a discrete tax benefit related to employee stock vesting. ~~The effective tax rate for the~~ three months ended September 30, 2021 differs from the U.S federal statutory rate of 21% primarily due to the reversal of approximately of $12.8 million in reserves for uncertain tax positions ("UTP") due to the expiration of relevant statutes of limitation. The effective tax rate for the nine months ended September 30, 2021 differs from the US federal statutory rate of 21% primarily due to the permanent add-backs related to fair value accounting on the Company's warrants and executive compensation with an offset related to the discrete tax benefit from the reversal of reserves for UTP.

NOTE 12 - Derivatives

In 2018, the Company entered into an interest rate swap agreement with a financial counterparty that effectively converted $400.0 million in aggregate notional amount of variable-rate debt under the Company’s former asset backed lending facility into fixed-rate debt. Under the terms of the agreement, the Company received a floating rate equal to one-month LIBOR and made payments based on a fixed rate of 3.06% on the notional amount. The swap agreement was designated and qualified as a hedge of the Company’s exposure to changes in interest payment cash flows created by fluctuations in variable interest rates on the former asset backed lending facility and terminated on May 29, 2022.

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 Company’s ABL Facility. Under the terms of the agreements, the Company receives a floating rate equal to one-month term SOFR and makes payments based on a weighted average fixed interest rate of 3.44% on the notional amount. 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 the ABL Facility. The swap agreements terminate on June 30, 2027. The floating rate that the Company receives under the terms of these swap agreements was 4.79% at March 31, 2023.

The location and the fair value of derivative instruments designated as hedges were as follows:


(in thousands)	Balance Sheet Location	March 31, 2023
Cash Flow Hedges:
Interest rate swap	Prepaid expenses and other current assets	$	8,646
Interest rate swap	Other non-current liabilities	$	(9,394)

The fair values of the interest rate swaps are based on dealer quotes of market forward rates, Level 2 inputs on the fair value hierarchy, and reflect the amounts that the Company would receive or pay as of March 31, 2023 for contracts involving the same attributes and maturity dates.

The following table discloses the impact of the interest rate swaps, excluding the impact of income taxes, on other comprehensive income (“OCI”), AOCI and the Company’s statements of operations for the three months ended March 31,:


(in thousands)	2023		2022
(Loss) gain recognized in OCI	$	(641)	$	3,098
Location of gain (loss) recognized in income	Interest expense, net		Interest expense, net
(Gain) loss reclassified from AOCI into income	$	(1,526)	$	2,890

Foreign Currency Contract

In December 2022, the Company executed a contingent forward contract to sell £330.0 million upon the closing of the sale of the former UK Storage Solutions segment at a price ranging from 1.20550 to 1.20440 US Dollars (USD) to British Pounds Sterling. The price was dependent upon the date of the closing of the sale. This contract, which was to expire on September 11, 2023, mitigated the foreign currency risk of the USD relative to the British Pound Sterling prior to the closing of the sale of the former UK Storage Solutions segment. This contract did not qualify for hedge accounting and was revalued at fair value at the reporting period with unrealized gains and losses reflected in the Company's results of operations. Upon the closing of the sale of the former UK Storage Solutions segment on January 31, 2023, the Company settled the contingent foreign currency forward contract and received cash at an exchange rate of 1.205 USD to British Pounds Sterling.

The location and the fair value of the foreign currency contract was as follows:


(in thousands)	Balance Sheet Location	December 31, 2022
Foreign currency contract	Accrued liabilities	$	930

The fair value of the foreign currency contract was based on dealer quotes of market forward rates, a Level 2 input on the fair value hierarchy, and reflected the amount that the Company would receive or pay for contracts involving the same attributes and maturity dates.

The location and the impact of the foreign currency contract, excluding the impact of income taxes, on the Company’s statement of operations for the three months ended March 31, 2023 was as follows:


(in thousands)	Income Statement Location	Three Months Ended March 31, 2023
Loss recognized in income	Currency losses, net	$	7,715

NOTE 1413 - Fair Value Measures

The fair value of financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The Company utilizes the suggested accounting guidance for the three levels of inputs that may be used to measure fair value:


Level 1 -			Observable inputs such as quoted prices in active markets for identical assets or liabilities;
Level 2 -			Observable inputs, other than Level 1 inputs in active markets, that are observable either directly or indirectly; and
Level 3 -			Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions

The Company has assessed that the fair value of cash and cash equivalents, trade receivables, trade payables, and other current liabilities approximate their carrying amounts. Based on the borrowing rates currently available for bank loans with similar terms and average maturities, the fair ~~values~~value of finance leases at ~~September 30, 2022~~March 31, 2023 approximate their respective book values.

The following table shows the carrying amounts and fair values of financial liabilities which are disclosed, but not measured, at fair value, including their levels in the fair ~~values~~value hierarchy:


		September 30, 2022								December 31, 2021									March 31, 2023								December 31, 2022
		Carrying Amount		Fair Value						Carrying Amount		Fair Value							Carrying Amount		Fair Value						Carrying Amount		Fair Value
(in thousands)	(in thousands)			Level 1		Level 2		Level 3				Level 1		Level 2		Level 3		(in thousands)			Level 1		Level 2		Level 3				Level 1		Level 2		Level 3
ABL Facility	ABL Facility	$	1,863,451	$	—	$	1,897,000	$	—	$	1,612,783	$	—	$	1,644,500	$	—	ABL Facility	$	1,795,448	$	—	$	1,825,500	$	—	$	1,988,176	$	—	$	2,020,000	$	—

2025 Secured Notes	2025 Secured Notes	519,778		—		513,932		—		518,117		—		551,835		—		2025 Secured Notes	520,931		—		526,300		—		520,350		—		526,800		—
2028 Secured Notes	2028 Secured Notes	493,220		—		435,320		—		492,490		—		515,635		—		2028 Secured Notes	493,723		—		458,205		—		493,470		—		450,135		—
Total	Total	$	2,876,449	$	—	$	2,846,252	$	—	$	2,623,390	$	—	$	2,711,970	$	—	Total	$	2,810,102	$	—	$	2,810,005	$	—	$	3,001,996	$	—	$	2,996,935	$	—

As of ~~September 30, 2022,~~March 31, 2023, the carrying values of the ABL Facility, the 2025 Secured Notes, and the 2028 Secured Notes included ~~$33.6~~$30.1 million, ~~$6.7~~$5.6 million, and ~~$6.8~~$6.3 million, respectively, of unamortized debt issuance costs, which were presented as a direct reduction of the corresponding liability. As of December 31, ~~2021,~~2022, the carrying value of the ABL Facility,

the 2025 Secured Notes, and the 2028 Secured Notes included ~~$31.7~~$31.8 million, ~~$8.4~~$6.2 million, and ~~$7.5~~$6.5 million, respectively, of unamortized debt issuance costs, which were presented as a direct reduction of the corresponding liability.

The carrying value of the ABL Facility, excluding debt issuance costs, approximates fair value as the interest rates are variable and reflective of current market rates. The fair value of the 2025 Secured Notes and the 2028 Secured Notes is based on their last trading price at the end of each period obtained from a third party. The classification and the fair value of derivative assets and liabilities ~~designated as hedges in the condensed consolidated balance sheets~~ are disclosed in Note ~~16.~~12.

~~Level 3 Disclosures~~

During the periods the 2015 Private Warrants were classified as liabilities, the Company utilized a Black Scholes option-pricing model to value the warrants at each reporting period and transaction date, with changes in fair value recognized in the statements of operations. The estimated fair value of the common stock warrant liability was determined using Level 3 inputs. Inherent in the pricing model were assumptions related to expected share-price volatility, expected life, risk-free interest rate and dividend yield. The volatility assumption was based on a blend of peer group volatility and Company trading history that matched the expected remaining life of the warrants as the Company did not have a sufficient trading history as a stand-alone public company to rely exclusively on its own trading history. The risk-free interest rate was based on the US Treasury zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants was assumed to be equivalent to their remaining contractual term. The dividend rate was based on the historical rate, which the Company anticipated to remain at zero.

~~The following table presents changes in Level 3 liabilities measured at fair value for the nine months ended September 30, 2021:~~


~~(in thousands)~~	~~2015 Private Warrants~~



~~Balance - December 31, 2020~~	$	~~77,404~~
~~Exercise or conversion~~	~~(78,495)~~
~~Measurement adjustment~~	~~25,486~~
~~Repurchases~~	~~(24,395)~~
~~Balance- September 30, 2021~~	$	—

NOTE 1514 - Stock-Based Compensation

Stock-based compensation expense includes grants of stock options, time-based restricted stock units ("Time-Based RSUs") and performance-based restricted stock units ("Performance-Based RSUs," together with Time-Based RSUs, the "RSUs"). In addition, stock-based payments to non-executive directors ~~include~~includes grants of restricted stock awards ("RSAs"). Time-Based RSUs and RSAs are valued based on the intrinsic value of the difference between the exercise price, if any, of the award and the fair market value of WillScot Mobile Mini's Common Stock on the grant date. Performance-Based RSUs are valued based on a Monte Carlo simulation model to reflect the impact of the Performance-Based ~~RSUs~~RSU's market condition. The probability of satisfying a market condition is considered in the estimation of the grant-date fair value for Performance-Based RSUs and the compensation cost is not reversed if the market condition is not achieved, provided the requisite service has been provided.

Restricted Stock Awards

The following table summarizes the Company's RSA activity for the three months ended March 31, 2023 and 2022:

2022 2021
Number of Shares Weighted-Average Grant Date Fair Value Number of Shares Weighted-Average Grant Date Fair Value
Balance December 31, 36,176 $ 29.30 57,448 $ 11.75
Granted 35,244 $ 37.17 44,708 $ 29.30
Forfeited — $ — (8,532) $ 29.30
Vested (36,176) $ 29.30 (57,448) $ 11.75
Balance September 30, 35,244 $ 37.17 36,176 $ 29.30


	2023			2022
	Number of Shares	Weighted-Average Grant Date Fair Value		Number of Shares	Weighted-Average Grant Date Fair Value
Outstanding at beginning of period	35,244	$	37.17	36,176	$	29.30



Outstanding at end of period	35,244	$	37.17	36,176	$	29.30

Compensation expense for RSAs recognized in SG&A ~~expense~~ on the condensed consolidated statements of operations was $0.3 million for ~~both~~each of the three months ended ~~September 30, 2022~~March 31, 2023 and 2021. Compensation expense for RSAs recognized in SG&A expense on the condensed consolidated statements of operations was $0.9 million and $0.6 million for the nine months ended September 30, 2022 and 2021, respectively.2022. At ~~September 30, 2022,~~March 31, 2023, there was ~~$0.9~~$0.2 million of unrecognized compensation cost related to RSAs that is expected to be recognized over the remaining weighted average vesting period of ~~0.7~~0.2 years.

Time-Based RSUs

The following table summarizes the Company's Time-Based RSU activity for the three months ended March 31, 2023 and 2022:


		2022			2021				2023			2022
		Number of Shares	Weighted-Average Grant Date Fair Value		Number of Shares	Weighted-Average Grant Date Fair Value			Number of Shares	Weighted-Average Grant Date Fair Value		Number of Shares	Weighted-Average Grant Date Fair Value
Balance December 31,		997,451	$	18.54	1,325,862	$	13.46
Outstanding at beginning of period								Outstanding at beginning of period	789,779	$	26.16	997,451	$	18.54
Granted	Granted	377,804	$	35.40	415,737	$	27.25	Granted	213,388	$	50.74	357,639	$	35.53
Forfeited	Forfeited	(94,841)	$	31.08	(65,153)	$	16.74	Forfeited	(31,681)	$	33.67	(9,299)	$	27.20
Vested	Vested	(478,906)	$	16.42	(667,151)	$	13.98	Vested	(281,153)	$	22.40	(420,184)	$	16.21
Balance September 30,		801,508	$	26.27	1,009,295	$	18.59
Outstanding at end of period								Outstanding at end of period	690,333	$	34.95	925,607	$	26.08

Compensation expense for Time-Based RSUs recognized in SG&A ~~expense~~ on the condensed consolidated statements of operations was ~~$1.7~~$1.8 million and ~~$3.2~~$2.2 million for the three months ended ~~September 30,~~March 31, 2023 and 2022, and 2021, respectively. Compensation expense for RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $6.4 million and $7.5 million for the nine months ended September 30, 2022 and 2021, respectively. At ~~September 30, 2022,~~March 31, 2023, unrecognized compensation cost related to Time-Based RSUs totaled ~~$15.9~~$21.6 million and is expected to be recognized over the remaining weighted average vesting period of ~~2.4~~2.7 years.

Performance-Based RSUs

The following table summarizes the Company's Performance-Based RSU award activity for the three months ended March 31, 2023 and 2022:
2022 2021
Number of Shares Weighted-Average Grant Date Fair Value Number of Shares Weighted-Average Grant Date Fair Value
Balance December 31, 1,536,394 $ 26.34 593,388 $ 14.88
Granted 745,079 $ 42.34 977,645 $ 33.21
Forfeited (61,678) $ 41.62 (20,077) $ 25.87
Vested (313,152) $ 16.45 — $ —
Balance September 30, 1,906,643 $ 33.72 1,550,956 $ 26.29


	2023			2022
	Number of Shares	Weighted-Average Grant Date Fair Value		Number of Shares	Weighted-Average Grant Date Fair Value
Outstanding at beginning of period	1,894,250	$	33.67	1,536,394	$	26.34
Granted	376,826	$	69.32	745,079	$	42.34
Forfeited	—	$	—	(5,046)	$	39.10
Vested	(181,319)	$	16.82	(267,964)	$	13.22
Outstanding at end of period	2,089,757	$	41.56	2,008,463	$	33.99

Compensation expense for Performance-Based RSUs recognized in SG&A ~~expense~~ on the condensed consolidated statements of operations was ~~$4.9~~$5.8 million and ~~$2.7~~$3.8 million for the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively. Compensation expense for Performance-Based RSUs recognized in SG&A expense on the condensed consolidated statements of operations was $15.2 million and $5.8 million for the nine months ended September 30, 2022 and 2021, respectively. At ~~September 30, 2022,~~March 31, 2023, unrecognized compensation cost related to Performance-Based RSUs totaled ~~$41.4~~$56.2 million and is expected to be recognized over the remaining vesting period of ~~2.3~~2.1 years.

Certain Performance-Based RSUs cliff vest based on achievement of the relative total stockholder return ("TSR") of the Company's Common Stock as compared to the TSR of the constituents in an index at the grant date over the performance period of three years. For ~~2022~~2023 grants, the TSR of the Company's Common Stock is compared to the TSR of the constituents in the S&P ~~MidCap~~ 400 Index. The target number of RSUs may be adjusted from 0% to 200% based on the TSR attainment levels defined by the Company's Compensation Committee. The 100% target payout is tied to performance at the 50% percentile, with a payout curve ranging from 0% (for performance less than the 25% percentile) to 200% (for performance above the 85% percentile).

Stock Options

The following ~~tables summarize~~table summarizes the Company's stock option activity for the three months ended March 31, 2023:

WillScot Options Weighted-Average Exercise Price per Share Converted
Mobile Mini Options Weighted-Average Exercise Price per Share
Balance December 31, 2021 534,188 $ 13.60 1,527,643 $ 14.66
Exercised — $ — (635,318) $ 17.02
Balance September 30, 2022 534,188 $ 13.60 892,325 $ 12.97
Fully vested and exercisable options, September 30, 2022 534,188 $ 13.60 892,325 $ 12.97


	WillScot Options	Weighted-Average Exercise Price per Share		Converted Mobile Mini Options	Weighted-Average Exercise Price per Share
Outstanding at beginning of period	534,188	$	13.60	864,276	$	12.91

Exercised	—	—		(5,774)	11.79
Outstanding at end of period	534,188	$	13.60	858,502	$	12.92

Fully vested and exercisable options, March 31, 2023	534,188	$	13.60	858,502	$	12.92

WillScot Options Weighted-Average Exercise Price per Share Converted Mobile Mini Options Weighted-Average Exercise Price per Share
Balance December 31, 2020 534,188 $ 13.60 2,031,455 $ 14.78
Forfeited — $ — (6,240) $ 12.19
Exercised — $ — (484,986) $ 15.26
Balance September 30, 2021 534,188 $ 13.60 1,540,229 $ 14.65
Fully vested and exercisable options, September 30, 2021 400,641 $ 13.60 1,540,229 $ 14.65
The following table summarizes the Company's stock option activity for the three months ended March 31, 2022:


	WillScot Options	Weighted-Average Exercise Price per Share		Converted Mobile Mini Options	Weighted-Average Exercise Price per Share
Outstanding at beginning of period	534,188	$	13.60	1,527,643	$	14.66
Exercised	—	—		(227,258)	14.58
Outstanding at end of period	534,188	$	13.60	1,300,385	$	14.67

Fully vested and exercisable options, March 31, 2022	534,188	$	13.60	1,300,385	$	14.67

WillScot Options

Compensation expense for stock option awards, recognized in SG&A ~~expense~~ on the condensed consolidated statements of operations, was $0.2 million for the three months ended ~~September 30, 2021. Compensation expense for stock option awards, recognized in SG&A expense on the condensed consolidated statements of operations, was $0.2 million and~~ ~~$0.6 million~~ ~~for the nine months ended September 30, 2022 and 2021, respectively.~~March 31, 2022.

~~NOTE 16 - Derivatives~~

In 2018, the Company entered into an interest rate swap agreement (the “Swap Agreement”) with a financial counterparty that effectively converted $400.0 million in aggregate notional amount of variable-rate debt under the Company’s ABL facility into fixed-rate debt. The Swap Agreement terminated on May 29, 2022. Under the terms of the Swap Agreement, the Company received a floating rate equal to one-month LIBOR and made payments based on a fixed rate of 3.06% on the notional amount. The receive rate under the terms of the Swap Agreement was 0.11% at December 31, 2021. The Swap Agreement was designated and qualified as a hedge of the Company’s exposure to changes in interest payment cash flows created by fluctuations in variable interest rates on the ABL facility.

~~The location and the fair value of derivative instruments designated as hedges, at the balance sheet date, was as follows:~~


~~(in thousands)~~	~~Balance Sheet Account~~	~~December 31, 2021~~
~~Interest rate swap~~	~~Accrued expenses~~	$	~~5,259~~

The fair value of the interest rate swap was based on dealer quotes of market forward rates, a Level 2 input on the fair value hierarchy, and reflected the amount that the Company would receive or pay for contracts involving the same attributes and maturity dates.

The following table discloses the impact of the interest rate swap, excluding the impact of income taxes, on other comprehensive income (“OCI”), AOCI and the Company’s combined consolidated statements of operations for the nine months ended September 30,:

(in thousands) 2022 2021
Gain recognized in OCI $ 4,669 $ 8,528
Location of gain recognized in income Interest expense, net Interest expense, net
Loss reclassified from AOCI into income (effective portion) $ (4,530) $ (8,967)

NOTE 1715 - Commitments and Contingencies

The Company is involved in various lawsuits, claims and legal proceedings that arise in the ordinary course of business. The Company assesses these matters on a case-by-case basis as they arise and establishes reserves as required. As of ~~September 30, 2022,~~March 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.~~flows. However, the outcome of such matters is inherently unpredictable and subject to significant uncertainties.

NOTE 1816 - Segment Reporting

The Company operates in ~~three~~two reportable segments as follows: ~~North America~~ Modular Solutions ("NA Modular")~~, North America~~ and Storage Solutions ("~~NA Storage") and United Kingdom Storage Solutions ("UK~~ Storage"). Total assets for each reportable segment are not available because the Company utilizes a centralized approach to working capital management. Transactions between reportable segments are not significant. During the first quarter of 2023, the ground level office business within the Modular segment was transferred to the Storage segment, and associated revenues, expenses, and operating metrics were transferred to the Storage segment. All periods presented have been retrospectively revised to reflect this change within the Modular and Storage segments. For the three months ended March 31, 2022, this resulted in approximately $11.1 million of revenue and $6.3 million of gross profit being transferred from the Modular segment to the Storage segment.

The Company defines EBITDA as net income (loss) plus interest (income) expense, income tax (benefit) expense, depreciation and amortization. The Company reflects further adjustments to EBITDA (“Adjusted EBITDA”) to exclude certain non-cash items and the effect of what the Company considers transactions or events not related to its core and ongoing business operations. In addition, the Chief Operating Decision Maker ("CODM") evaluates business segment performance utilizing Adjusted EBITDA as shown in the reconciliation of the Company’s consolidated income from continuing operations to Adjusted EBITDA below. Management believes that evaluating segment performance excluding such items is meaningful because it provides insight with respect to the intrinsic and ongoing operating results of the Company. The Company ~~also regularly evaluates gross profit by segment to assist in the assessment of its operational performance. The Company~~ considers Adjusted EBITDA to be an important metric because it reflects the business performance of the segments, inclusive of indirect costs. The Company also regularly evaluates gross profit by segment to assist in the assessment of its operational performance.

Reportable Segments

The following tables set forth certain information regarding each of the Company’s reportable segments for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively.


		Three Months Ended September 30, 2022											Three Months Ended March 31, 2023
(in thousands)	(in thousands)	NA Modular		NA Storage		UK Storage		Unallocated Costs 1		Total		(in thousands)	Modular		Storage		Unallocated Costs		Total
Revenues:	Revenues:											Revenues:
Leasing and services revenue:	Leasing and services revenue:											Leasing and services revenue:
Leasing	Leasing	$	271,271	$	156,572	$	19,692			$	447,535	Leasing	$	269,271	$	170,680			$	439,951
Delivery and installation	Delivery and installation	84,373		42,643		5,821				132,837		Delivery and installation	64,821		41,809				106,630
Sales revenue:	Sales revenue:											Sales revenue:
New units	New units	7,893		1,714		294				9,901		New units	8,921		1,736				10,657
Rental units	Rental units	11,827		1,716		357				13,900		Rental units	6,657		1,573				8,230
Total revenues	Total revenues	375,364		202,645		26,164				604,173		Total revenues	349,670		215,798				565,468

Costs:	Costs:											Costs:
Cost of leasing and services:	Cost of leasing and services:											Cost of leasing and services:
Leasing	Leasing	81,385		26,334		4,179				111,898		Leasing	73,582		23,933				97,515
Delivery and installation	Delivery and installation	66,464		25,281		3,935				95,680		Delivery and installation	51,503		23,504				75,007
Cost of sales:	Cost of sales:											Cost of sales:
New units	New units	4,796		1,002		209				6,007		New units	5,665		543				6,208
Rental units	Rental units	5,639		1,207		251				7,097		Rental units	3,370		1,084				4,454
Depreciation of rental equipment	Depreciation of rental equipment	60,228		7,786		1,145				69,159		Depreciation of rental equipment	50,215		8,941				59,156
Gross profit	Gross profit	$	156,852	$	141,035	$	16,445			$	314,332	Gross profit	$	165,335	$	157,793			$	323,128
Other selected data:	Other selected data:											Other selected data:
Adjusted EBITDA	Adjusted EBITDA	$	140,673	$	98,695	$	11,971	$	—	$	251,339	Adjusted EBITDA	$	136,964	$	109,878	$	—	$	246,842
Selling, general and administrative expense	Selling, general and administrative expense	$	79,345	$	49,799	$	5,622	$	10,678	$	145,444	Selling, general and administrative expense	$	81,816	$	57,675	$	11,401	$	150,892
Purchases of rental equipment and refurbishments	Purchases of rental equipment and refurbishments	$	81,052	$	41,246	$	4,605	$	—	$	126,903	Purchases of rental equipment and refurbishments	$	39,412	$	7,345	$	—	$	46,757

1 ~~Unallocated SG&A expense includes non-cash charges for stock compensation plans and costs to integrate acquired companies.~~

2623


		Three Months Ended September 30, 2021											Three Months Ended March 31, 2022
(in thousands)	(in thousands)	NA Modular		NA Storage		UK Storage		Unallocated Costs		Total		(in thousands)	Modular		Storage		Unallocated Costs		Total
Revenues:	Revenues:											Revenues:
Leasing and services revenue:	Leasing and services revenue:											Leasing and services revenue:
Leasing	Leasing	$	219,736	$	101,172	$	21,691			$	342,599	Leasing	$	223,298	$	128,261			$	351,559
Delivery and installation	Delivery and installation	58,017		28,330		5,563				91,910		Delivery and installation	54,332		31,207				85,539
Sales revenue:	Sales revenue:											Sales revenue:
New units	New units	13,483		1,307		580				15,370		New units	4,844		943				5,787
Rental units	Rental units	7,815		3,088		265				11,168		Rental units	6,073		2,213				8,286
Total revenues	Total revenues	299,051		133,897		28,099				461,047		Total revenues	288,547		162,624				451,171

Costs:	Costs:											Costs:
Cost of leasing and services:	Cost of leasing and services:											Cost of leasing and services:
Leasing	Leasing	59,260		14,393		4,314				77,967		Leasing	61,330		19,004				80,334
Delivery and installation	Delivery and installation	51,655		19,328		3,238				74,221		Delivery and installation	47,906		22,674				70,580
Cost of sales:	Cost of sales:											Cost of sales:
New units	New units	10,080		727		368				11,175		New units	3,256		500				3,756
Rental units	Rental units	3,636		1,587		245				5,468		Rental units	3,449		1,443				4,892
Depreciation of rental equipment	Depreciation of rental equipment	46,566		5,366		1,058				52,990		Depreciation of rental equipment	50,008		7,540				57,548
Gross profit	Gross profit	$	127,854	$	92,496	$	18,876			$	239,226	Gross profit	$	122,598	$	111,463			$	234,061
Other selected data:	Other selected data:											Other selected data:
Adjusted EBITDA	Adjusted EBITDA	$	106,825	$	59,123	$	13,255	$	—	$	179,203	Adjusted EBITDA	$	99,586	$	68,187	$	—	$	167,773
Selling, general and administrative expense	Selling, general and administrative expense	$	66,529	$	39,314	$	6,680	$	14,823	$	127,346	Selling, general and administrative expense	$	74,638	$	51,862	$	11,644	$	138,144
Purchases of rental equipment and refurbishments	Purchases of rental equipment and refurbishments	$	31,789	$	11,920	$	11,649	$	—	$	55,358	Purchases of rental equipment and refurbishments	$	57,577	$	20,171	$	—	$	77,748

Nine Months Ended September 30, 2022
(in thousands) NA Modular NA Storage UK Storage Unallocated Costs Total
Revenues:
Leasing and services revenue:
Leasing $ 756,294 $ 409,491 $ 60,421 $ 1,226,206
Delivery and installation 213,686 109,710 17,631 341,027
Sales revenue:
New units 21,258 4,064 910 26,232
Rental units 31,482 6,082 1,310 38,874
Total revenues 1,022,720 529,347 80,272 1,632,339
Costs:
Cost of leasing and services:
Leasing 213,675 62,489 12,610 288,774
Delivery and installation 174,498 70,364 11,268 256,130
Cost of sales:
New units 12,297 2,578 594 15,469
Rental units 16,125 4,090 908 21,123
Depreciation of rental equipment 166,552 22,241 3,435 192,228
Gross profit $ 439,573 $ 367,585 $ 51,457 $ 858,615
Other selected data:
Adjusted EBITDA $ 372,502 $ 243,282 $ 36,745 $ — $ 652,529
Selling, general and administrative expense $ 242,268 $ 146,189 $ 18,147 $ 38,715 $ 445,319
Purchases of rental equipment and refurbishments $ 221,111 $ 95,699 $ 21,824 $ — $ 338,634

Nine Months Ended September 30, 2021
(in thousands) NA Modular NA Storage UK Storage Unallocated Costs Total
Revenues:
Leasing and services revenue:
Leasing $ 636,979 $ 267,489 $ 61,426 $ 965,894
Delivery and installation 161,548 73,214 18,152 252,914
Sales revenue:
New units 27,814 5,355 2,746 35,915
Rental units 28,316 11,381 1,214 40,911
Total revenues 854,657 357,439 83,538 1,295,634
Costs:
Cost of leasing and services:
Leasing 172,108 37,300 13,339 222,747
Delivery and installation 147,514 51,811 10,638 209,963
Cost of sales:
New units 19,330 3,190 1,802 24,322
Rental units 14,611 6,667 1,163 22,441
Depreciation of rental equipment 144,102 17,635 3,290 165,027
Gross profit $ 356,992 $ 240,836 $ 53,306 $ 651,134
Other selected data:
Adjusted EBITDA $ 307,741 $ 154,971 $ 36,647 $ — $ 499,359
Selling, general and administrative expense $ 192,285 $ 105,577 $ 19,949 $ 38,840 $ 356,651
Purchases of rental equipment and refurbishments $ 120,288 $ 24,165 $ 22,645 $ — $ 167,098

The following table presents reconciliations of the Company’s ~~Income~~income from continuing operations to Adjusted EBITDA for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively:

Three Months Ended September 30, Nine Months Ended September 30,
(in thousands) 2022 2021 2022 2021
Income from continuing operations $ 85,728 $ 57,113 $ 200,099 $ 75,278
Income tax expense from continuing operations 30,219 5,243 67,167 32,341
Loss on extinguishment of debt — — — 5,999
Fair value loss on common stock warrant liabilities — — — 26,597
Interest expense 38,165 29,006 102,362 87,793
Depreciation and amortization 86,225 69,449 243,123 216,820
Currency losses, net 236 127 247 196
Restructuring costs, lease impairment expense and other related charges — 2,457 168 14,284
Transaction costs — 303 35 1,147
Integration costs 3,902 8,242 13,182 23,206
Stock compensation expense 7,180 6,157 22,628 14,305
Other (316) 1,106 3,518 1,393
Adjusted EBITDA $ 251,339 $ 179,203 $ 652,529 $ 499,359

Included in restructuring costs for the three and nine months ended September 30, 2021 was expense of approximately $1.4 million and $7.2 million, respectively, recognized as a result of the modification of certain equity awards associated with the Transition, Separation and Release Agreement entered into on February 25, 2021 with the Company's former President and Chief Operating Officer.


	Three Months Ended March 31,
(in thousands)	2023		2022
Income from continuing operations	$	76,271	$	39,048
Income tax expense from continuing operations	30,510		12,083


Interest expense	44,866		30,570
Depreciation and amortization	76,329		72,910
Currency losses, net	6,775		137
Restructuring costs, lease impairment expense and other related charges	22		263
Transaction costs	—		13
Integration costs	3,873		4,087
Stock compensation expense	8,150		6,273
Other	46		2,389
Adjusted EBITDA	$	246,842	$	167,773

3024

NOTE 1917 - Earnings Per Share

The following table reconciles the weighted average shares outstanding for the basic calculation to the weighted average shares outstanding for the diluted calculation:


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31
(in thousands)	(in thousands)	2022		2021		2022		2021		(in thousands)	2023		2022
Numerator:	Numerator:									Numerator:
Income from continuing operations	Income from continuing operations	$	85,728	$	57,113	$	200,099	$	75,278	Income from continuing operations	$	76,271	$	39,048
Income from discontinued operations	Income from discontinued operations	42,865		3,990		53,041		10,643		Income from discontinued operations	134,613		12,123
Net income	Net income	$	128,593	$	61,103	$	253,140	$	85,921	Net income	$	210,884	$	51,171

Denominator:	Denominator:									Denominator:
Weighted average Common Shares outstanding - basic		213,637		225,998		219,312		227,558
Weighted average Common Shares outstanding – basic										Weighted average Common Shares outstanding – basic	206,092		223,491
Dilutive effect of shares outstanding	Dilutive effect of shares outstanding									Dilutive effect of shares outstanding
Warrants	Warrants	1,812		3,722		1,816		4,112		Warrants	—		1,889
RSAs	RSAs	8		4		17		25		RSAs	27		27
Time-based RSUs	Time-based RSUs	355		476		382		573		Time-based RSUs	326		483
Performance-based RSUs	Performance-based RSUs	1,067		618		1,279		751		Performance-based RSUs	2,206		1,819
Stock Options	Stock Options	1,049		1,050		1,127		1,066		Stock Options	1,013		1,246

Weighted average Common Shares outstanding - dilutive		217,928		231,868		223,933		234,085
Weighted average Common Shares outstanding – dilutive										Weighted average Common Shares outstanding – dilutive	209,664		228,956

For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022, 555,790 ~~and 788,183~~ shares of Performance-Based RSUs ~~respectively,~~ were excluded from the computation of diluted EPS because their effect would have been anti-dilutive. ~~For the three and nine months ended September 30, 2021, no warrants, shares or options were excluded from the computation of diluted EPS.~~

3125

ITEM 2. 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"), our operations and our present business environment. 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 I, Item 1 of this report. The discussion of results of operations in this MD&A is presented on a historical basis, as of or for the three ~~and nine~~ months ended March 31, 2023 or prior periods.

On September 30, 2022, ~~or prior periods.~~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 former United Kingdom ("UK") Storage Solutions segment. 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 consolidated financial statements were prepared in conformity with accounting principles generally accepted in the US (“GAAP”). We use certain non-GAAP financial metrics to supplement the GAAP reported results to highlight key operational metrics that are used by management to evaluate Company performance. Reconciliations of GAAP financial information to the disclosed non-GAAP measures are provided in the Reconciliation of Non-GAAP Financial Measures section.

Executive Summary and Outlook

We are a leading business services provider specializing in innovative flexible work space and portable storage solutions. We service diverse end markets across all sectors of the economy throughout the United States ("US"), Canada, ~~Mexico~~ and ~~the United Kingdom ("UK").~~Mexico. As of ~~September 30, 2022,~~March 31, 2023, our branch network included approximately ~~260~~240 branch locations and additional drop lots to service our over 85,000 customers. We offer our customers an extensive selection of “Ready to Work” modular space and portable storage solutions with over ~~167,000~~154,000 modular space units and over ~~239,000~~210,000 portable storage units in our ~~fleet, representing over 130 million square feet of relocatable space.~~fleet.

We primarily lease, rather than sell, our modular and portable storage units to customers, which results in a highly diversified and predictable ~~recurring~~reoccurring revenue stream. 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~~reoccurring nature and the underlying stability and diversification of our lease portfolio. 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 ~~modular space and portable storage~~ lease portfolio, excluding seasonal portable storage units, is approximately 3033 months. We complement our core leasing business by selling both new and used units, allowing us to leverage scale, achieve purchasing benefits and redeploy capital employed in our lease fleet.

Our customers operate in a diversified set of end markets, including construction, commercial and industrial, retail and wholesale trade, energy and natural resources, education, government and institutions and healthcare. Core to our operating model is the ability to redeploy standardized assets across end ~~markets, as we did in 2020 and 2021 to service emerging demand in the healthcare and government sectors related to COVID-19, as well as expanded space requirements related to social distancing.~~markets. We track several market leading indicators to predict demand, including those related to our two largest end markets, the commercial and industrial ~~segment~~sector and the construction ~~segment,~~sector, which collectively accounted for approximately ~~47% and 41%~~88% of our revenues ~~respectively, for~~in the three months ended ~~September 30, 2022.~~March 31, 2023.

We remain focused on our core priorities of growing leasing revenues by increasing units on rent, both organically and through ~~mergers and acquisitions,~~our acquisition strategy, delivering “Ready to Work” solutions to our customers with value added products and services ("VAPS"), and on continually improving the overall customer experience.

Significant Developments

Customer Relationship Management ("CRM") System

On February 6, 2023, we successfully completed the harmonization of our separate Modular and Storage CRM systems onto a single unified system. With this enhanced platform, we have a combined view of our customers and projects across the entire sales team. Going forward, we will focus on productivity management and building a more targeted and predictive approach to anticipate- and service- customer demand, with continued improvement in engagement and outreach underpinned by our data warehouse.

Divestiture

On ~~September 30, 2022,~~January 31, 2023, we ~~sold~~completed the sale of our ~~Tank and Pump~~former UK Storage Solutions ~~("Tank and Pump") business~~segment for ~~$319.5~~total cash consideration of $418.1 million. Proceeds from the sale ~~will be~~were used to support ongoing reinvestment in our ~~core~~ Modular and Storage operating segments in North America and other capital allocation priorities. ~~In accordance with ASC 205-20,~~ ~~Presentation of Financial Statements - Discontinued Operations~~, we determined that the criteria for discontinued operations presentation were met during the third quarter of 2022 and results for the three and nine months ended September 30, 2022 and 2021 for Tank and Pump are reported in income from discontinued operations within the condensed consolidated statements of operations and the carrying value of the divested business' assets and liabilities are presented within assets and liabilities held for sale on the condensed consolidated balance sheet as of December 31, 2021. See Note 3 to the Condensed Consolidated Financial Statements for further information.

3226

~~As part~~Reportable Segments

Following the divestitures of the divestiture, the Company entered into a customary transition services agreement with the buyer to assist them in the transition of certain functions, including, but not limited to, information technology, accountingUK Storage Solutions and ~~human resources for a period of six months with an option for the buyer to extend the agreement for a period of up to twelve months. There will be no significant continuing involvement with the~~ Tank and Pump segments, we operate in two reporting segments: Modular Solutions ("Modular") and Storage Solutions ("Storage"). The reporting segments are aligned with how we operate and analyze our business ~~after its disposal.~~results. During the first quarter of 2023, the ground level office business within the Modular segment was transferred to the Storage segment, and associated revenues, expenses, and operating metrics were transferred to the Storage segment. All periods presented have been retrospectively revised to reflect this adjustment within the Modular and Storage segments. For the twelve months ended December 31, 2022, this resulted in approximately $49.8 million of revenue and $28.5 million of gross profit being transferred from the Modular segment to the Storage segment.

Asset Acquisitions

During the first quarter of 2023, we acquired certain assets and liabilities of two regional and local storage and modular companies, which consisted primarily of approximately 300 storage units and 500 modular units for $79.6 million in cash. The accompanying consolidated financial statements include $70.4 million of rental equipment and $4.5 million of land held for sale as a result of these acquisitions.

Interest Rate Swap Agreements

In January 2023, we entered into two interest rate swap agreements with financial counterparties relating to $750.0 million in aggregate notional amount of variable-rate debt under our ABL Facility (as defined below). 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 3.44% on the notional amount. 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.

Share Repurchases

During the three months ended March 31, 2023, we repurchased 4,589,308 shares of Common Stock for $215.7 million. As of March 31, 2023, $415.1 million of the approved share repurchase pool remained available. Given the predictability of our free cash flow, we believe that repurchases will be a reoccurring capital allocation priority.

Inflation and Supply Chain Issues

Similar to many other organizations, we face inflationary pressures across most of our input costs such as building materials, labor, transportation and fuel. Inflation has contributed to increased capital costs both for ~~both~~ new units as well as for refurbishment of our existing units. 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. Additionally, ~~given~~because we derive the majority of our revenue ~~is derived~~ from leasing our existing lease fleet units to customers and our material purchases to maintain these units ~~consists~~consist primarily of general building materials, we have not experienced significant supply chain issues to date.

~~Asset Acquisitions~~

During the third quarter of 2022, we acquired certain assets and liabilities of several entities, which consisted primarily of approximately 7,600 storage units and 3,000 modular units for $104.7 million in cash. When combined with other recent acquisitions over the past four quarters, we have acquired assets and liabilities from 13 regional and local storage and modular companies, consisting primarily of 16,800 storage units and 9,700 modular units.

~~Share and Warrant Repurchases~~

During the nine months ended September 30, 2022, we repurchased and cancelled 33,965 of the 2018 Warrants for $0.6 million. In addition, for the nine months ended September 30, 2022, 1,037,379 of the 2018 Warrants were exercised on a cashless basis, resulting in the issuance of 631,863 shares of common stock. At September 30, 2022, ~~3,006,829~~ ~~of the 2018 Warrants were outstanding.~~

~~During the nine months ended September 30, 2022, we repurchased a total of 14,575,160 shares of Common Stock and stock equivalents for~~ ~~$524.4 million, including the repurchased warrants. As of September 30, 2022, we had~~ ~~$863.3 million~~ remaining of a $1.0 billion share repurchase authorization under our stock repurchase program. Given our growth strategy and the predictability of our free cash flow, we believe that repurchases will be a reoccurring capital allocation priority.

~~Third~~First Quarter Highlights

For the three months ended ~~September 30, 2022, as compared to the three months ended September 30, 2021, unless otherwise noted,~~March 31, 2023, key drivers of our financial performance included:

•Total revenues ~~from continuing operations~~ increased ~~by $143.2~~$114.3 million, or ~~31.1%, attributable to organic revenue growth levers in the business and due to the impact of acquisitions.~~25.3%. Leasing revenue increased ~~$104.9~~$88.4 million, or ~~30.6%~~25.1%, ~~and~~ delivery and installation revenue increased ~~$40.9~~$21.1 million, or ~~44.5%. Additionally,~~24.7%, rental unit sales ~~increased $2.7~~decreased $0.1 million, or ~~24.1%~~1.2%, and new ~~unit~~ sales revenue ~~decreased $5.5~~increased $4.9 million, or ~~35.7%~~84.5%. ~~We estimate that recent acquisitions completed over the past four quarters contributed approximately $22.4 million to total revenues for the three months ended September 30, 2022.~~

Key leasing revenue drivers included:

–•Average portable storage units on rent increased ~~41,048~~12,304 units, or ~~25.1%~~8.1%, and average modular space units on rent ~~increased 4,153~~decreased 1,430 units, or 3.8%, across all segments. Approximately 53% of the increase in total average units on rent was driven by units on rent added through recent acquisitions and the other 47% was driven by increases in organic delivery activity and lower return activity during 2021 and 2022.1.4%.

–•Average modular space monthly rental rate increased ~~$140,~~$163, or ~~18.3%~~19.7%, to ~~$907~~$989 driven by strong pricing performance across ~~the NA Modular and NA Storage~~both segments. Average modular space monthly rental rates increased by ~~$157,~~$152, or ~~18.8%~~17.0%, in the NA Modular segment and by ~~$144,~~$174, or ~~23.9%~~29.7%, in the NA Storage segment. ~~Average modular space monthly rental rates decreased by $63, or 13.9%, in the UK Storage segment due to the weakening of the British Pound and were up £1, or 0.3%, in local currency.~~

–•Average portable storage monthly rental rate increased ~~$37,~~$50, or ~~25.5%~~30.1%, to ~~$182~~$216 driven by increased pricing 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.~~processes.

–•Average utilization for portable storage units ~~increased 500 basis points ("bps")~~decreased to ~~88.9%~~78.7% from 83.1% for the same period in 2022 driven by decreased demand in 2023 as compared to the same period in ~~2021 driven by increased demand in 2022 including the acceleration earlier into the third quarter of our seasonal retail business as compared to the same period in 2021.~~2022. Average utilization for modular space units decreased ~~120 bps~~250 basis points ("bps") to ~~68.9%~~66.0%.

•NA Modular segment revenue, which ~~represented 62.1%~~represents 61.8% of consolidated revenue for the three months ended ~~September 30, 2022,~~March 31, 2023, increased ~~$76.3~~$61.1 million, or ~~25.5%~~21.2%, to ~~$375.4 million. The increase was driven by our core~~

leasing revenue, which grew $51.6 million, or 23.5%, due to continued growth of pricing and value added products. Delivery and installation revenues increased $26.4 million, or 45.5%, driven by increased pricing on new deliveries and returns and increased delivery volumes as compared to 2021. Rental unit sales increased $4.0 million, or 51.3%, and new unit sales decreased $5.6 million, or 41.5%. NA Modular segment revenue drivers for the three months ended September 30, 2022 included:

–Modular space average monthly rental rate of $991 increased 18.8% year over year representing a continuation of our long-term price optimization initiative and VAPS penetration opportunities across our portfolio.

–~~Average modular space units on rent increased 3,146, or 3.7%, year over year driven primarily by units on rent added through recent acquisitions.~~

–~~Average modular space monthly utilization increased 20 bps to 67.8% for the three months ended September 30, 2022, as compared to the three months ended September 30, 2021.~~

•~~NA Storage segment revenue, which represented 33.5% of consolidated revenue for the three months ended September 30, 2022, increased $68.7 million, or 51.3%, to $202.6~~$349.7 million. The increase was driven by our core leasing revenue, which grew ~~$55.4~~$46.0 million, or ~~54.7%~~20.6%, due to continued growth of pricing and VAPS, and by delivery and installation revenues, which increased $10.5 million, or 19.3%, driven by increased pricing. Rental unit sales increased $0.5 million, or 8.1%, and new unit sales increased $4.1 million, or 85.4%. Modular revenue drivers for the three months ended March 31, 2023 included:

•Modular space average monthly rental rate of $1,046, increased 17.0% year over year representing a continuation of the long-term price optimization and VAPS penetration opportunities across our portfolio.

•Average modular space units on rent increased 1,219, or 1.5%, year over year.

•Average modular space monthly utilization decreased 70 bps to 66.2% for the three months ended March 31, 2023, as compared to the three months ended March 31, 2022.

•Storage segment revenue, which represents 38.2% of consolidated revenue for the three months ended March 31, 2023, increased $53.2 million, or 32.7%, to $215.8 million. The increase was driven by our core leasing revenue, which grew $42.4 million, or 33.0%, due to increased units on rent ~~driven by significant increases in delivery activity during 2021 and 2022 as economic activity rebounded versus 2020, recent acquisition activity,~~ and increased pricing, and ~~value added products. Delivery~~by delivery and installation revenues, which increased ~~$14.3~~$10.6 million, or ~~50.5%~~34.0%, driven by increased ~~demand for new project deliveries, and by increased pricing on new deliveries and returns as compared to 2021.~~pricing. Rental unit sales decreased ~~$1.4~~$0.6 million, or ~~45.2%~~27.3%, and new unit sales increased ~~$0.4~~$0.8 million, or ~~30.8%~~88.9%.

NA Storage ~~segment~~ revenue drivers for the three months ended ~~September 30, 2022~~March 31, 2023 included:

•Portable storage average monthly rental rate of ~~$197~~$216 increased ~~27.1%~~30.1% year over year 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.~~early benefits from increased VAPS penetration opportunities. Modular space average monthly rental rate of ~~$746~~$760 increased ~~23.9%~~29.7% year over year as a result of price optimization and ~~early benefits from~~ increased VAPS ~~penetration opportunities.~~penetration.

•Average portable storage units on rent increased ~~38,823,~~12,265, or ~~28.3%~~8.1%, year over year. Increases in organic activity drove an increase in average portable storage units on rent of approximately 14%, or 19,000 units on rent, including an acceleration earlier into the third quarter of our seasonal retail business. The remaining increase of approximately 20,000 units on rent wasyear driven by ~~units added~~growth achieved in ~~recent acquisitions.~~2022. Average modular space units on rent ~~increased 1,736,~~decreased 2,649, or ~~10.6%~~11.6%, year over ~~year driven by increases in organic delivery activity as well as due to approximately 600 acquired units on rent.~~year.

•Average portable storage monthly utilization ~~increased 560~~decreased 450 bps to ~~88.8%~~78.7% for the three months ended ~~September 30, 2022,~~March 31, 2023, as compared to the three months ended ~~September 30, 2021.~~March 31, 2022. Average modular space monthly utilization decreased ~~390~~960 bps to ~~73.7%~~65.3% for the three months ended ~~September 30, 2022,~~March 31, 2023, as compared to the three months ended ~~September 30, 2021.~~

•UK Storage segment revenue, which represented 4.3% of consolidated revenue for the three months ended September 30, 2022, decreased $1.9 million, or 6.8%, to $26.2 million and Adjusted EBITDA decreased $1.3 million, or 9.8%, to $12.0 million driven entirely by the weakening of the British Pound relative to the US Dollar. Unfavorable currency fluctuations reduced Adjusted EBITDA by $2.0 million in GBP. In local currency, revenue increased 9.1% year-over-year, driven by a 13.6% increase in portable storage average monthly rental rates and a 8.4% increase in average portable storage units on rent, and Adjusted EBITDA increased by 5.7% year-over-year.March 31, 2022.

•Generated income from continuing operations of ~~$85.7~~$76.3 million for the three months ended ~~September 30, 2022 representing an increase~~March 31, 2023. Discrete costs in the period included $3.9 million of ~~$28.6 million, or 46.8%, versus the three months ended September 30, 2021. Net income including income from discontinued operations was $128.6 million for the three months ended September 30, 2022.~~integration costs.

•Generated Adjusted EBITDA from continuing operations of ~~$251.3~~$246.8 million for the three months ended ~~September 30, 2022,~~March 31, 2023, representing an increase of ~~$72.1~~$79.0 million, or ~~40.2%~~47.1%, as compared to the same period in ~~2021.~~2022. This increase was driven primarily by increased leasing and delivery and installation gross profit. ~~Including results from discontinued operations representing the divestiture of the Tank and Pump segment,~~

•Adjusted EBITDA margin from continuing operations was ~~$264 million.~~

▪~~Consolidated Adjusted EBITDA Margin was 41.6%~~43.7% in the ~~third~~first quarter of ~~2022~~2023 and increased ~~270~~650 bps versus prior year driven by ~~increased leasing and~~continued expansion of all margin lines. Most significantly, delivery and installation margins increased 1,220 bps versus prior year driven primarily by increased pricing.

•Net cash provided by operating activities increased $3.2 million to $148.8 million despite the divestitures of the Tank and Pump and UK Storage Segments. Net cash used in investing activities, excluding cash used as part of acquisitions and proceeds from the sale of discontinued operations including the settlement of the contingent foreign currency forward contract that we executed relating to the sale of the former UK Storage Solutions segment, decreased by $45.1 million as a result of ~~increased volumes~~reduced refurbishment spending and ~~pricing, partially offset by increased selling, general and administrative expense.~~decreased purchases of new fleet as a result of lower utilization.

•Generated Free Cash Flow of ~~$83.4~~$102.9 million for the three months ended ~~September 30, 2022~~March 31, 2023 representing an increase of ~~$4.9~~$48.3 million as compared to the same period in ~~2021. Net~~2022. This Free Cash Flow along with additional net borrowings under the ABL Facility (defined as receipts from borrowings, less repayment of borrowings from the condensed consolidated statement of cash ~~provided by operating activities increased $80.0~~flows) and proceeds of $404.3 million related to ~~$210.4 million. Net cash used in investing activities excluding acquisitions and~~the sale of ~~discontinued~~

~~operations increased by $38.6 million to $127.0 million to support increases in delivery activity during 2022 as economic activity rebounded versus 2021, and~~ the ~~related unit on rent growth.~~former UK Storage Solutions segment, net of the settlement of the contingent foreign currency forward contract, were deployed to:

•~~Returned $197.5~~Acquire two regional and local storage and modular portfolios of approximately 300 storage units and 500 modular units for $79.6 million; and

•Return $215.7 million to shareholders ~~by repurchasing 5.3 million shares of~~through stock repurchases, reducing outstanding Common Stock ~~and stock equivalents during the three months ended September 30, 2022 and closed four acquisitions totaling approximately 7,600 storage units and 3,000 modular units for $104.7 million.~~ by 4,589,308 shares.

•We believe the predictability of our free cash flow allows us to pursue multiple capital allocation priorities opportunistically, including investing in organic opportunities we see in the market, ~~continuing~~maintaining leverage in our ~~deleveraging trajectory,~~stated range, opportunistically executing accretive acquisitions, and returning capital to shareholders.

3528

Consolidated Results of ~~Continuing~~ Operations

Three Months Ended ~~September 30, 2022~~March 31, 2023 Compared to the Three Months Ended ~~September 30, 2021~~March 31, 2022

Our condensed consolidated statements of operations for the three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ are presented below.


		Three Months Ended September 30,				2022 vs. 2021 $ Change			Three Months Ended March 31,				2023 vs. 2022 $ Change
(in thousands)	(in thousands)	2022		2021				(in thousands)	2023		2022
Revenues:	Revenues:							Revenues:
Leasing and services revenue:	Leasing and services revenue:							Leasing and services revenue:
Leasing	Leasing	$	447,535	$	342,599	$	104,936	Leasing	$	439,951	$	351,559	$	88,392
Delivery and installation	Delivery and installation	132,837		91,910		40,927		Delivery and installation	106,630		85,539		21,091
Sales revenue:	Sales revenue:							Sales revenue:
New units	New units	9,901		15,370		(5,469)		New units	10,657		5,787		4,870
Rental units	Rental units	13,900		11,168		2,732		Rental units	8,230		8,286		(56)
Total revenues	Total revenues	604,173		461,047		143,126		Total revenues	565,468		451,171		114,297
Costs:	Costs:							Costs:
Costs of leasing and services:	Costs of leasing and services:							Costs of leasing and services:
Leasing	Leasing	111,898		77,967		33,931		Leasing	97,515		80,334		17,181
Delivery and installation	Delivery and installation	95,680		74,221		21,459		Delivery and installation	75,007		70,580		4,427
Costs of sales:	Costs of sales:							Costs of sales:
New units	New units	6,007		11,175		(5,168)		New units	6,208		3,756		2,452
Rental units	Rental units	7,097		5,468		1,629		Rental units	4,454		4,892		(438)
Depreciation of rental equipment	Depreciation of rental equipment	69,159		52,990		16,169		Depreciation of rental equipment	59,156		57,548		1,608
Gross profit	Gross profit	314,332		239,226		75,106		Gross profit	323,128		234,061		89,067
Expenses:	Expenses:							Expenses:
Selling, general and administrative	Selling, general and administrative	145,444		127,346		18,098		Selling, general and administrative	150,892		138,144		12,748

Other depreciation and amortization	Other depreciation and amortization	17,066		16,459		607		Other depreciation and amortization	17,173		15,362		1,811
Lease impairment expense and other related charges		—		601		(601)
Restructuring costs		—		1,856		(1,856)

Currency losses, net	Currency losses, net	236		127		109		Currency losses, net	6,775		137		6,638
Other (income) expense, net		(2,526)		1,475		(4,001)
Other income, net								Other income, net	(3,359)		(1,283)		(2,076)
Operating income	Operating income	154,112		91,362		62,750		Operating income	151,647		81,701		69,946
Interest expense	Interest expense	38,165		29,006		9,159		Interest expense	44,866		30,570		14,296

Income from continuing operations before income tax	Income from continuing operations before income tax	115,947		62,356		53,591		Income from continuing operations before income tax	106,781		51,131		55,650
Income tax expense from continuing operations	Income tax expense from continuing operations	30,219		5,243		24,976		Income tax expense from continuing operations	30,510		12,083		18,427

Income from continuing operations	Income from continuing operations	$	85,728	$	57,113	$	28,615	Income from continuing operations	$	76,271	$	39,048	$	37,223

Discontinued operations:								Discontinued operations:
Income from discontinued operations before income tax								Income from discontinued operations before income tax	4,003		15,787		(11,784)
Gain on sale of discontinued operations								Gain on sale of discontinued operations	176,078		—		176,078
Income tax expense from discontinued operations								Income tax expense from discontinued operations	45,468		3,664		41,804
Income from discontinued operations								Income from discontinued operations	134,613		12,123		122,490

Net income								Net income	$	210,884	$	51,171	$	159,713

Comparison of Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~

Revenue: Total revenue increased ~~$143.2~~$114.3 million, or ~~31.1%~~25.3%, to ~~$604.2~~$565.5 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$461.0~~$451.2 million for the three months ended ~~September 30, 2021.~~March 31, 2022. Leasing revenue increased ~~$104.9~~$88.4 million, or ~~30.6%~~25.1%, as compared to the same period in ~~2021~~2022 driven by improved pricing and value added products penetration and an increase of ~~41,048~~12,304 average portable storage units on ~~rent driven by significant increases in delivery activity during 2021 and into 2022 as economic activity rebounded versus 2020 and recent acquisition activity.~~rent. Delivery and installation revenues increased ~~$40.9~~$21.1 million, or ~~44.5%~~24.7%, due to increased ~~overall activity and increased~~ pricing ~~due to~~across both of our ~~ability to pass through increasing fuel costs and general price increases.~~segments. Rental unit sales ~~increased $2.7~~decreased $0.1 million, or ~~24.1%~~1.2%, and new unit sales ~~decreased $5.5~~increased $4.9 million, or ~~35.7%. We estimate that recent acquisitions completed over the past four quarters contributed approximately $22.4 million to total revenues for three months ended September 30, 2022.~~84.5% driven by increased sale opportunities in our Modular segment.

Total average units on rent for the three months ended ~~September 30,~~March 31, 2023 and 2022 were 267,230 and ~~2021 were 318,281 and 273,080,~~256,356, respectively, representing an increase of ~~45,201,~~10,874, or ~~16.6%~~4.2%. ~~Of this increase, approximately 20,000 portable storage units and 4,000 modular space units on rent were added through recent acquisitions.~~ Portable storage average units on rent increased by ~~41,048~~12,304 units, or ~~25.1%~~8.1%, for the three months ended ~~September 30, 2022~~March 31, 2023 driven by strong ~~demand~~delivery and ~~acquisitions.~~unit on rent growth in 2022. The average portable storage unit utilization rate during the three months ended ~~September 30, 2022~~March 31, 2023 was ~~88.9%~~78.7%, as compared to

~~83.9%~~ 83.1% during the same period in ~~2021.~~2022. Modular space average units on rent ~~increased 4,153~~decreased 1,430 units, or ~~3.8%~~1.4%, for the three months ended ~~September 30, 2022~~March 31, 2023 as compared to the three months ended ~~September 30, 2021 driven primarily by acquisitions.~~March 31, 2022. The average modular space unit utilization rate during the three months ended ~~September 30, 2022~~March 31, 2023 was ~~68.9%,~~66.0% as compared to ~~70.1%~~68.5% during the same period in ~~2021.~~2022.

Modular space average monthly rental rates increased ~~18.3%~~19.7% to ~~$907~~$989 for the three months ended ~~September 30, 2022. Improved pricing was achieved across all relevant segments.~~March 31, 2023. Average modular space monthly rental rates increased by ~~$157,~~$152, or ~~18.8%~~17.0%, to ~~$991~~$1,046 in the NA Modular segment and by ~~$144,~~$174, or ~~23.9%~~29.7%, in the NA Storage segment. Increases were driven by a continuation of ~~our~~the long-term price optimization ~~initiative~~ and VAPS penetration opportunities across our NA Modular segment as well as by ~~some early~~ application of these same price management tools and processes across the NA Storage segment. ~~The NA Storage segment also continued to see early benefits from increased VAPS penetration opportunities.~~

Average portable storage monthly rental rates increased ~~25.5%~~30.1% to ~~$182~~$216 for the three months ended ~~September 30, 2022~~March 31, 2023 driven by our price management tools and processes ~~further supported by high utilization~~ and ~~by an acceleration earlier into~~early benefits from increased VAPS penetration opportunities on our basic VAPS offerings in the ~~third~~Storage segment, which began in the second quarter of ~~our seasonal retail business at increased rates.~~2022.

Gross Profit: Our gross profit percentage was 52.0% and 51.9% for the three months ended September 30, 2022 and 2021, respectively. Our adjusted gross profit percentage, which excludes the effects of depreciation, was 63.5% and 63.4% for the three months ended September 30, 2022 and 2021, respectively. Gross profit increased ~~$75.1~~$89.1 million, or ~~31.4%~~38.1%, to ~~$314.3~~$323.1 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$239.2~~$234.1 million for the three months ended ~~September 30, 2021.~~March 31, 2022. The increase in gross profit was a result of a ~~$71.0~~$71.2 million increase in leasing gross profit, increased delivery and installation gross profit of ~~$19.4~~$16.7 million and increased new and rental unit ~~sale margins~~sales gross profit of ~~$0.8~~$2.8 million. ~~These increases~~Increases were primarily a result of increased revenues due to favorable average monthly rental rates and delivery and installation pricing across both portable storage and modular space units, ~~increased pricing on delivery and installation,~~ as well as due to ~~higher~~increased portable storage units on ~~rent~~rent. Cost of leasing and services increased ~~activity levels driving higher delivery~~by $21.6 million, or 14.3%, for the three months ended March 31, 2023 versus the three months ended March 31, 2022, driven by a $5.7 million, or 27.6%, increase in material costs, a $7.4 million, or 13.9%, increase in labor costs, a $6.6 million, or 11.8%, increase in subcontractor costs, and ~~installation~~a $1.9 million, or 9.1%, increase in vehicle, equipment and other costs. Cost of sales increased by $2.0 million, or 23.3%, which is in line with expected costs to deliver increased sales revenues ~~partially offset by increased variable costs during~~of 35.0% for the ~~period as a result~~three months ended March 31, 2023, resulting in improved sales gross profit margins. The year over year changes in each of ~~higher activity levels~~these cost components was consistent with historical trends and management's expectations given the respective change in ~~the current quarter~~sales volume and inflationary pressures ~~across many~~impacting our business. Increase in gross profit were offset partially by increased depreciation of ~~our cost categories. Depreciation increased $16.2~~$1.6 million, or 2.8%, as a result of capital investments made over the past twelve months in ~~our~~ rental ~~equipment, including~~equipment.

Our resulting gross profit percentage was 57.1% and 51.9% for the ~~impact~~three months ended March 31, 2023 and 2022, respectively. Our gross profit percentage, excluding the effects of ~~recent acquisitions.~~depreciation, was 67.6% and 64.6% for the three months ended March 31, 2023 and 2022, respectively. These increases were driven primarily by continued price optimization within leasing, delivery, and installation revenues and execution of VAPS penetration opportunities that have outpaced increases in cost of leasing and services.

SG&A: Selling, general and administrative ~~expense~~ ("SG&A") increased ~~$18.1~~$12.7 million, or ~~14.2%~~9.2%, to ~~$145.4~~$150.9 million for the three months ended ~~September 30, 2022,~~March 31, 2023, compared to ~~$127.3~~$138.1 million for the three months ended ~~September 30, 2021.~~March 31, 2022. Employee ~~costs~~Costs excluding stock compensation increased ~~$12.2~~$2.5 million, or ~~20.6%~~3.8%, ~~driven by a 12% 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. Stock~~an increase in indirect labor headcount and annual wage increases. Travel expenses increased $3.5 million, or 66.3%, due to increased travel and training, and real estate costs increased $2.1 million, or 11.2%. Additionally, stock compensation expense increased ~~$1.0~~$1.9 million to $7.2 million for the three months ended September 30, 2022, compared to $6.2 million for the three months ended September 30, 2021. Integration costs decreased $4.3 million to $3.9 million for the three months ended September 30, 2022, compared to $8.2 million for the three months ended September 30, 2021. The remaining increases were primarily driven by increased economic activity and inflationary increases, including increased occupancy and office costs, legal and professional fees, insurance, travel expenses, and marketing cost increases.March 31, 2023, compared to $6.3 million for the three months ended March 31, 2022.

Other Depreciation and Amortization: Other depreciation and amortization increased ~~$0.6~~$1.8 million to ~~$17.1~~$17.2 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~$16.5~~$15.4 million for the three months ended ~~September 30, 2021.~~March 31, 2022. The increase was driven by ~~an increase~~increased depreciation as a result of our recent investments in ~~depreciation of vehicles, buildings~~our CRM system and ~~equipment.~~other infrastructure improvements across our branch network.

~~Lease Impairment Expense and Other Related Charges:~~Currency Losses (Gains), net: ~~Lease impairment expense and other related charges were $0 for the three months ended September 30, 2022 as compared~~Currency losses, net increased by $6.7 million to ~~$0.6~~$6.8 million for the three months ended ~~September 30, 2021. The decrease resulted from fewer closed locations during the three months ended September 30, 2022 as compared to the three months ended September 30, 2021.~~

~~Restructuring Costs:~~ ~~Restructuring costs were $1.9 million for the three months ended September 30, 2021 primarily driven by employee termination costs resulting from the elimination of positions due to the merger.~~

~~Currency Losses, net:~~ ~~Currency losses, net changed by $0.1 million to $0.2 million for the three months ended September 30, 2022~~March 31, 2023 from $0.1 million for the three months ended ~~September 30, 2021.~~March 31, 2022. This change was primarily attributable to a loss on the ~~impact~~settlement of the contingent foreign currency ~~exchanges rate changes on intercompany receivables and payables denominated in a currency other than~~forward contract to sell £330.0 million upon the ~~subsidiary's functional currency.~~closing of the sale of the former UK Storage Solutions segment.

Other ~~(Income)~~ Expense ~~net:~~(Income), Net: ~~Other (income) expense, net was $2.5 million of income for the three months ended September 30, 2022 compared to $1.5 million of expense for the three months ended September 30, 2021.~~ Other income, net ~~of $2.5~~was $3.4 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to $1.3 million for the three months ended March 31, 2022. The increase in other income, net was ~~primarily~~ related to an increase in insurance recoveries ~~in the quarter~~during 2023 related to ~~Hurricane Ida~~Hurricanes in the Gulf Coast area of the United ~~States in 2021.~~States.

Interest Expense: Interest expense increased ~~$9.2~~$14.3 million, or ~~31.7%~~46.7%, to ~~$38.2~~$44.9 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$29.0~~$30.6 million for the three months ended ~~September 30, 2021 due to both an~~March 31, 2022. The increase in ~~outstanding borrowings and an increase in the~~interest expense was a result of higher overall weighted average interest ~~rate for borrowings under the ABL Facility due to increased benchmark interest~~ rates ~~partially offset by a favorable margin reduction~~ as a result of ~~the June 30, 2022~~

~~amendment to the credit facility.~~our financing activities. See Note ~~10 to the condensed consolidated financial statements for further discussion of our debt.~~

~~Income Tax Expense:~~ Income tax expense increased $25.0 million to $30.2 million for the three months ended September 30, 2022 compared to $5.2 million for the three months ended September 30, 2021. The increase in expense was driven by the pre-tax income increase for the three months ended September 30, 2022.

~~Nine Months Ended September 30, 2022 Compared to the Nine Months Ended September 30, 2021~~

~~Our condensed consolidated statements of operations for the nine months ended September 30, 2022 and 2021 are presented below.~~

Nine Months Ended September 30, 2022 vs. 2021 $ Change
(in thousands) 2022 2021
Revenues:
Leasing and services revenue:
Leasing $ 1,226,206 $ 965,894 $ 260,312
Delivery and installation 341,027 252,914 88,113
Sales revenue:
New units 26,232 35,915 (9,683)
Rental units 38,874 40,911 (2,037)
Total revenues 1,632,339 1,295,634 336,705
Costs:
Costs of leasing and services:
Leasing 288,774 222,747 66,027
Delivery and installation 256,130 209,963 46,167
Costs of sales:
New units 15,469 24,322 (8,853)
Rental units 21,123 22,441 (1,318)
Depreciation of rental equipment 192,228 165,027 27,201
Gross profit 858,615 651,134 207,481
Expenses:
Selling, general and administrative 445,319 356,651 88,668
Other depreciation and amortization 50,895 51,793 (898)
Lease impairment expense and other related charges 254 2,328 (2,074)
Restructuring costs (86) 11,956 (12,042)
Currency losses, net 247 196 51
Other (income) expense, net (7,642) 202 (7,844)
Operating income 369,628 228,008 141,620
Interest expense 102,362 87,793 14,569
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 267,266 107,619 159,647
Income tax expense 67,167 32,341 34,826
Income from continuing operations $ 200,099 $ 75,278 $ 124,821

~~Comparison of Nine Months Ended September 30, 2022 and 2021~~

~~Revenue:~~ Total revenue increased $336.7 million, or 26.0%, to $1,632.3 million for the nine months ended September 30, 2022 from $1,295.6 million for the nine months ended September 30, 2021. Leasing revenue increased $260.3 million, or 26.9%, as compared to the same period in 2021 driven by an increase of 38,780 average modular space and portable storage units on rent as a result of increased economic activity and acquisitions, and improved pricing and value added products. Delivery and installation revenues increased $88.1 million, or 34.8%, due to increased overall activity and increased pricing due to our ability to pass through increasing fuel costs and general price increases. Rental unit sales decreased $2.0 million, or 4.9%, and new unit sales decreased $9.7 million, or 27.0%.

Total average units on rent for the nine months ended September 30, 2022 and 2021 were 302,444 and 263,664, respectively. Modular space average units on rent increased 2,787 units, or 2.5%, for the nine months ended September 30, 2022 as compared to the nine months ended September 30, 2021. Modular space average monthly rental rates increased 17.3% to $853 for the nine months ended September 30, 2022. Portable storage average units on rent increased by 35,993 units, or 23.5%, for the nine months ended September 30, 2022. Average portable storage monthly rental rates increased 22.1% to $171 for the nine months ended September 30, 2022. The average modular space unit utilization rate during the nine months ended September 30, 2022 was 68.9%, as compared to 70.2% during the same period in 2021. The average portable storage unit utilization rate during the nine months ended September 30, 2022 was 86.4%, as compared to 78.7% during the same period in 2021.

~~Gross Profit:~~ Our gross profit percentage was 52.6% and 50.3% for the nine months ended September 30, 2022 and 2021, respectively. Our adjusted gross profit percentage, which excludes the effects of depreciation, was 64.4% and 63.0% for the nine months ended September 30, 2022 and 2021, respectively. Gross profit increased $207.5 million, or 31.9%, to $858.6 million for the nine months ended September 30, 2022 from $651.1 million for the nine months ended September 30, 2021. The increase in gross profit was a result of a $194.2 million increase in leasing gross profit and increased delivery and installation gross profit of $42.0 million, partially offset by decreased new and rental unit sale margins of $1.6 million. The increases in leasing gross profit and delivery and installation gross profit were driven by favorable average monthly rental rates on modular space and portable storage units, increased pricing on delivery and installation, as well as due to higher units on rent and increased activity levels driving higher delivery and installation revenues. Depreciation increased to $192.2 million as a result of fleet acquired through acquisitions and capital investments made in our rental equipment.

~~SG&A:~~ SG&A increased $88.6 million, or 24.8%, to $445.3 million for the nine months ended September 30, 2022, compared to $356.7 million for the nine months ended September 30, 2021. Employee costs excluding stock compensation increased $45.3 million, or 27.2%, 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. Stock compensation expense increased $8.3 million to $22.6 million for the nine months ended September 30, 2022, compared to $14.3 million for the nine months ended September 30, 2021. Integration costs decreased $10.0 million to $13.2 million for the nine months ended September 30, 2022, compared to $23.2 million for the nine months ended September 30, 2021. The remaining increases were primarily driven by increased economic activity and inflationary increases, including increased occupancy and office costs, legal and professional fees, insurance, travel expenses, and marketing cost increases.

~~Other Depreciation and Amortization:~~ ~~Other depreciation and amortization decreased $0.9 million to $50.9 million for the nine months ended September 30, 2022 compared to $51.8 million for the nine months ended September 30, 2021.~~

~~Lease Impairment Expense and Other Related Charges:~~ ~~Lease impairment expense and other related charges was $0.3 million for the nine months ended September 30, 2022 as compared to $2.3 million for the nine months ended September 30, 2021.~~

~~Restructuring Costs:~~ In the nine months ended September 30, 2021, the Company recorded $12.0 million of restructuring costs primarily as a result of employee termination costs from the elimination of positions due to the Merger. Employee termination costs of $7.2 million were settled in stock, which is non-cash, non-recurring and not included in stock compensation expense.

~~Currency Losses, Net:~~ ~~Currency losses, net of $0.2 million remained flat for the nine months ended September 30, 2022 when compared to the nine months ended September 30, 2021.~~

~~Other Income, Net:~~ Other income, net was $7.6 million of income for the nine months ended September 30, 2022 compared to $0.2 million of expense for the nine months ended September 30, 2021. The increase was primarily attributable to insurance recoveries in the current period related to Hurricane Ida in the Gulf Coast area of the United States in 2021.

~~Interest Expense:~~ Interest expense increased $14.6 million to $102.4 million for the nine months ended September 30, 2022 from $87.8 million for the nine months ended September 30, 2021 due to both an increase in outstanding borrowings and an increase in the weighted average interest rate for borrowings under the ABL Facility due to increased benchmark interest rates, partially offset by a favorable margin reduction as a result of the June 30, 2022 amendment to the credit facility. See Note 109 to the condensed consolidated financial statements for further discussion of our debt.

~~Fair Value Loss on Common Stock Warrant Liabilities:~~ The fair value loss on common stock warrant liabilities was $26.6 million for the nine months ended September 30, 2021, primarily due to the change in estimated fair value of common stock warrant liabilities. Subsequent to May 2021, no 2015 Private Warrants were outstanding.

~~Loss on Extinguishment of Debt:~~ During the nine months ended September 30, 2021, the Company redeemed $123.5 million of the outstanding principal of its 2025 Secured Notes and recorded a loss on extinguishment of debt of $6.0 million. There was no similar transaction in the nine months ended September 30, 2022.

Income Tax Expense: Income tax expense increased ~~$34.9~~$18.4 million to ~~$67.2~~$30.5 million for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~$32.3~~$12.1 million for the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022. The increase in expense was driven by ~~the pre-tax income increase for the nine months ended September 30, 2022.~~

3930

an increase in income from continuing operations before income tax for the three months ended March 31, 2023 as compared to the three months ended March 31, 2022.

Income from Discontinued Operations: Income from discontinued operations increased $122.5 million to $134.6 million for the three months ended March 31, 2023 compared to $12.1 million for the three months ended March 31, 2022. The increase in income from discontinued operations was driven by the gain on sale of the former UK Storage Solutions segment of $176.1 million, partially offset by an increase in income tax expense from discontinued operations.

Business Segment Results

~~Following the divestiture of the Tank and Pump segment, the~~The Company operates in ~~three~~two reportable segments as follows: NA Modular ~~NA Storage~~ and UK Storage. NA Modular represents the activities of the North American modular ~~business. NA~~business, excluding ground level offices, which were transferred to the Storage segment during the first quarter of 2023. Storage represents the activities of the North American portable storage and ground level office business. UKAs part of the transfer of the ground level offices to Storage, ~~represents the results of all~~we also adjusted average modular ~~and portable storage operations~~space monthly rental rate in the ~~UK. During the third quarter of 2021, the majority of the portable storage product business within the NA Modular segment was transitioned to the NA~~ Storage segment ~~and associated revenues, expenses, and operating metrics beginning~~to only include VAPS specifically applicable to ground level offices, which has also been reflected in the third quarter of 2021 were transferred to the NA Storage segment, representing a shift of approximately $5.0 million of revenue and gross margin per quarter from the NA Modular segment to the NA Storage segment. This adjustment was not made to the historical segment results of prior periods, given its relative immateriality.total average modular space monthly rental rate.

The following tables and discussion summarize our reportable segment financial information for the three ~~and nine~~ months ended ~~September 30, 2022~~March 31, 2023 and ~~2021.~~2022.

Comparison of Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~

Three Months Ended September 30, 2022
(in thousands, except for units on rent and rates) NA Modular NA Storage UK Storage Total
Revenue $ 375,364 $ 202,645 $ 26,164 $ 604,173
Gross profit $ 156,852 $ 141,035 $ 16,445 $ 314,332
Adjusted EBITDA $ 140,673 $ 98,695 $ 11,971 $ 251,339
Capital expenditures for rental equipment $ 81,052 $ 41,246 $ 4,605 $ 126,903
Average modular space units on rent 87,364 18,052 8,569 113,985
Average modular space utilization rate 67.8 % 73.7 % 71.5 % 68.9 %
Average modular space monthly rental rate $ 991 $ 746 $ 391 $ 907
Average portable storage units on rent 556 175,946 27,794 204,296
Average portable storage utilization rate 63.1 % 88.8 % 89.7 % 88.9 %
Average portable storage monthly rental rate $ 227 $ 197 $ 88 $ 182
Three Months Ended September 30, 2021
(in thousands, except for units on rent and rates) NA Modular NA Storage UK Storage Total
Revenue $ 299,051 $ 133,897 $ 28,099 $ 461,047
Gross profit $ 127,854 $ 92,496 $ 18,876 $ 239,226
Adjusted EBITDA $ 106,825 $ 59,123 $ 13,255 $ 179,203
Capital expenditures for rental equipment $ 31,789 $ 11,920 $ 11,649 $ 55,358
Average modular space units on rent 84,218 16,316 9,298 109,832
Average modular space utilization rate 67.6 % 77.6 % 83.4 % 70.1 %
Average modular space monthly rental rate $ 834 $ 602 $ 454 $ 767
Average portable storage units on rent 493 137,123 25,632 163,248
Average portable storage utilization rate 48.0 % 83.2 % 89.1 % 83.9 %
Average portable storage monthly rental rate $ 179 $ 155 $ 90 $ 145


	Three Months Ended March 31, 2023
(in thousands, except for units on rent and rates)	Modular			Storage			Total
Revenue	$	349,670		$	215,798		$	565,468
Gross profit	$	165,335		$	157,793		$	323,128
Adjusted EBITDA	$	136,964		$	109,878		$	246,842
Capital expenditures for rental equipment	$	39,412		$	7,345		$	46,757
Average modular space units on rent	81,902			20,235			102,137
Average modular space utilization rate	66.2		%	65.3		%	66.0		%
Average modular space monthly rental rate	$	1,046		$	760		$	989
Average portable storage units on rent	502			164,591			165,093
Average portable storage utilization rate	62.0		%	78.7		%	78.7		%
Average portable storage monthly rental rate	$	217		$	216		$	216


	Three Months Ended March 31, 2022
(in thousands, except for units on rent and rates)	Modular			Storage			Total
Revenue	$	288,547		$	162,624		$	451,171
Gross profit	$	122,598		$	111,463		$	234,061
Adjusted EBITDA	$	99,586		$	68,187		$	167,773
Capital expenditures for rental equipment	$	57,577		$	20,171		$	77,748
Average modular space units on rent	$	80,683		$	22,884		$	103,567
Average modular space utilization rate	66.9		%	74.9		%	68.5		%
Average modular space monthly rental rate	$	894		$	586		$	826
Average portable storage units on rent	$	463		$	152,326		$	152,789
Average portable storage utilization rate	52.6		%	83.2		%	83.1		%
Average portable storage monthly rental rate	$	160		$	166		$	166

Modular

Revenue: Total revenue increased ~~$76.3~~$61.1 million, or ~~25.5%~~21.2%, to ~~$375.4~~$349.7 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$299.1~~$288.6 million for the three months ended ~~September 30, 2021.~~March 31, 2022. The increase was primarily the result of a ~~$51.6~~$46.0 million, or ~~23.5%~~20.6%, increase in leasing revenue, a ~~$26.4~~$10.5 million, or ~~45.5%~~19.3%, increase in ~~modular~~ delivery and installation revenue ~~a $4.0~~driven by improved pricing, an increase of $0.5 million, or ~~51.3%~~8.1%, ~~increase~~ in rental unit sales ~~revenue. These were partially offset by~~revenue and a ~~$5.6~~$4.1 million, or ~~41.5%~~85.4%, ~~decrease~~increase in new unit sales. Average modular space monthly rental rates increased ~~18.8%~~17.0% for the three months ended ~~September 30, 2022~~March 31, 2023 to ~~$991 driven by the continuation of our long-term price optimization initiative and VAPS penetration opportunities~~

4031

$1,046 driven by the continuation of the long-term price optimization and VAPS penetration opportunities across our portfolio. Average modular space units on rent increased by ~~3,146~~1,219 units, or ~~3.7%~~1.5%, year over ~~year primarily due to acquisitions.~~year.

Gross Profit: Gross profit increased ~~$29.0~~$42.7 million, or ~~22.7%~~34.8%, to ~~$156.9~~$165.3 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$127.9~~$122.6 million for the three months ended ~~September 30, 2021. Gross profit percentage contracted 100 bps to 41.8%.~~March 31, 2022. The increase in gross profit was driven by higher leasing gross profit, which increased ~~$29.5~~$33.7 million, or ~~18.4%~~20.8%, driven byfrom improved pricing including VAPS. The increase in gross profit from leasing for the three months ended ~~September 30, 2022~~March 31, 2023 was further complemented by ~~an $11.6~~a $6.9 million increase in delivery and installation gross profit ~~and~~driven by increased pricing ahead of inflationary costs, a ~~$2.0~~$0.6 million increase in rental unit sales gross ~~profit. These increases were~~profit, and a $1.7 million increase in new sales gross profit, partially offset by a ~~$13.6~~$0.2 million increase in depreciation of rental equipment. Cost of leasing and services increased by $15.8 million, or 14.5%, for the three months ended March 31, 2023 versus the three months ended March 31, 2022, driven by a $5.5 million, or 35.0%, increase in material costs, a $5.3 million, or 14.4%, increase in labor costs, a $4.0 million, or 9.0%, increase in subcontractor costs, and a $1.0 million, or 8.2%, increase in vehicle, equipment ~~related~~and other costs. Cost of sales increased by $2.3 million, or 34.7%, which is in line with expected costs to deliver increased sales revenues of 43.1% for three months ended March 31, 2023, resulting in improved sales gross profit margins. The year over year changes in each of these cost components was consistent with historical trends and management's expectations given the respective change in sales volume and inflationary pressures impacting our business. Increases in gross profit were offset partially by increased depreciation of $0.2 million, or 0.4%, as a result of capital investments made over the past twelve months in ~~our~~ rental ~~equipment and due to fleet acquired as part of acquisitions, and a $0.3 million decrease in new unit sales gross profit.~~equipment.

Adjusted EBITDA: Adjusted EBITDA increased ~~$33.9~~$37.3 million, or ~~31.8%~~37.4%, to ~~$140.7~~$136.9 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$106.8~~$99.6 million for the three months ended ~~September 30, 2021. Adjusted EBITDA margin percentage increased 176 bps to 37.5%.~~March 31, 2022. The increase was primarily driven by higher leasing and delivery and installation gross ~~profits~~profit discussed above. SG&A, excluding discrete items, increased ~~$12.8~~$7.2 million, or ~~19.2%~~9.7%, for the three months ended ~~September 30, 2022,~~March 31, 2023, as compared to the three months ended ~~September 30, 2021 to support higher staffing levels for both organic and inorganic growth, wage increases, and~~March 31, 2022. Employee Costs increased ~~variable compensation~~$3.3 million, or 9.7%, as a result of ~~the growth achieved,~~an increase in indirect labor headcount and annual wage increases. Travel expenses increased ~~office~~$1.7 million, or 52.8% due to increased travel and ~~occupancy~~training, and real estate costs increased ~~travel expenses, and increased subscription, legal and professional fees.~~$1.1 million, or 8.6%.

Capital Expenditures for Rental Equipment: Purchases of rental equipment and refurbishments ~~increased $49.3~~decreased $18.2 million, or ~~155.0%~~31.6%, to ~~$81.1~~$39.4 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$31.8~~$57.6 million for the three months ended ~~September 30, 2021. Net Fleet CAPEX increased $45.3 million, or 188.8%, to $69.2 million. These increases were~~March 31, 2022 driven by ~~increased refurbishments,~~successful efforts to reduce our refurbishment costs through better unit selection and ~~increased new fleet and VAPS purchase volumes, further increased by inflationary pressures.~~work scope during 2023.

NA Storage

Revenue: Total revenue increased ~~$68.7~~$53.2 million, or ~~51.3%~~32.7%, to ~~$202.6~~$215.8 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$133.9~~$162.6 million for the three months ended ~~September 30, 2021. Leasing~~March 31, 2022. The increase was primarily the result of a $42.4 million, or 33.0%, increase in leasing revenue and a $10.6 million, or 34.0%, increase in delivery and installation revenue driven by improved pricing. Sales revenues increased ~~$55.4~~$0.2 million, or 6.5%. Average portable storage monthly rental rates increased 30.1% for the three months ended March 31, 2023 to $216 driven by our price management tools and processes and early benefits from increased VAPS penetration opportunities on our basic VAPS offerings, which began in the ~~current~~second quarter ~~compared to the prior-year quarter. Modular~~of 2022. Average modular space ~~average~~ units on rent increased ~~10.6%~~by 12,265 units, or 8.1%, year over year driven by strong delivery and ~~average~~unit on rent growth in 2022. Average modular space monthly rental rates increased ~~23.9%~~29.7% year-over-year driven primarily by increased pricing on new ~~deliveries. Portable storage~~deliveries; however, average units on rent increased 38,823, or 28.3%. Increases in organic activity drove an increase in average portable storage units on rent of approximately 14.0% or 19,000 units on rent, including an acceleration earlier into the third quarter of our seasonal retail business. The remaining increase of approximately 20,000 units on rent wasdecreased 11.6% driven by units added in recent acquisitions. Average portable storage monthly rental rates increased 27.1% year-over-year 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. Delivery and installation revenues increased $14.3 million year-over-year driven by increased demand for new project deliveries, and by increased pricing on new deliveries and returns as compared to 2021. Sales revenues decreased $1.0 million compared to the prior-year quarter.lower demand.

Gross Profit: Gross profit increased by ~~$48.5~~$46.3 million, or ~~52.4%~~41.5%, to ~~$141.0~~$157.8 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~$92.5~~$111.5 million for the three months ended ~~September 30, 2021. Gross profit percentage increased 50 bps to 69.6%.~~March 31, 2022. Gross profit on leasing activity increased by ~~$43.5~~$37.5 million ~~year-over-year~~year over year driven by both increased volume and increased pricing as described above. ~~For delivery~~Delivery and installation gross profit increased ~~$8.4 million.~~$9.8 million, or 114.5%, driven by increased pricing ahead of inflationary cost. Sales gross profit increased by $0.5 million to $1.7 million. Increases in gross profit were partially offset by a $1.4 million increase in depreciation of rental equipment. Cost of leasing and services increased by $5.8 million, or 13.9%, for the three months ended March 31, 2023 versus the three months ended March 31, 2022, driven by a $0.2 million, or 4.1%, increase in material costs, a $2.1 million, or 12.8%, increase in labor costs, a $2.5 million, or 22.9%, increase in subcontractor costs, and a $0.9 million, or 10.2%, increase in vehicle, equipment and other costs. Cost of sales decreased by ~~$0.9~~$0.3 million, ~~to $1.2 million.~~or 16.1%, driven by improved sales gross profit margins on increased sales revenues of 6.5% for three months ended March 31, 2023. The year over year changes in each of these cost components was consistent with historical trends and management's expectations given the respective change in sales volume and inflationary pressures impacting our business. These increases were offset partially by increased depreciation of $1.4 million, or 18.6%, as a result of capital investments made over the past twelve months in rental equipment.

Adjusted EBITDA: Adjusted EBITDA increased ~~$39.6~~$41.7 million, or ~~66.9%~~61.1%, to ~~$98.7~~$109.9 million for the three months ended ~~September 30, 2022~~March 31, 2023 from ~~$59.1~~$68.2 million for the three months ended ~~September 30, 2021. Adjusted EBITDA~~March 31, 2022 and the margin ~~percentage~~expanded to 50.9% from 41.9% as a result of increased ~~455 bps to 48.7%.~~units on rent, favorable pricing on units and on delivery and installation, and increased VAPS penetration. The increase in Adjusted EBITDA was driven primarily by increased leasing gross profit as described above, partially offset by increased SG&A. ~~Excluding acquisition-related costs and stock-based compensation,~~ SG&A, excluding discrete items, increased ~~$10.5~~$5.8 million, ~~in this segment. The increase was comprised of increased costs~~or 11.2%, for ~~personnel, including commissions and other~~the three months ended March 31, 2023, as compared to the three months ended March 31, 2022. Employee Costs decreased $0.8 million, or

2.6%, due to reduced variable compensation ~~to support~~that offset annual wage increases. Travel expenses increased ~~commercial activity,~~$1.8 million, or 87.4% due to increased travel ~~expenses,~~ and training, and real estate costs increased ~~subscription and professional fees.~~$1.0 million, or 17.0%.

Capital Expenditures for Rental Equipment: Purchases of rental equipment and refurbishments ~~increased $29.3~~of $7.3 million ~~or 246.2%, to $41.2~~were $12.9 million for the three months ended September 30, 2022 from $11.9 million for the three months ended September 30, 2021. Net Fleet CAPEX increased $30.7 million, or 347.6%, to $39.5 million. The increase in purchases of rental equipment and refurbishments was driven primarily by increased purchases of portable storage containers during the period to support organic growth.

~~UK Storage~~

~~Revenue:~~ Total revenue decreased $1.9 million, or 6.8%, to $26.2 million for the three months ended September 30, 2022 from $28.1 million for the three months ended September 30, 2021 due to the strengthening of the U.S. Dollar. In local currency, total revenues increased £1.8 million to £22.2 million. Leasing revenues decreased $2.0 million in the current quarter compared tolower than the prior-year ~~quarter. In local currency, leasing revenues increased £1.0 million to £16.7 million. Modular space~~

average units on rent decreased 7.8%, while portable storage units on rent increased 8.4%. Average monthly rental rates for modular space units decreased 13.9% and average monthly rental rates for portable storage units decreased 2.2% year-over-year, including the impacts of currency fluctuations. In local currency, average monthly rental rates for modular space units increased 0.3% and average monthly rental rates for portable storage increased 13.6% year-over-year. Delivery and installation revenues increased $0.2 million year-over-year. In local currency, delivery and installation revenues increased £0.9 million to £5.0 million. Sales revenues decreased $0.1 million compared to the prior-year quarter. In local currency, sales revenues decreased £0.1 million to £0.6 million.

~~Gross Profit:~~ Gross profit decreased $2.5 million, or 13.2%, for the three months ended September 30, 2022 to $16.4 million from $18.9 million for the three months ended September 30, 2021 due to the strengthening of the U.S. Dollar. In local currency, gross profit increased £0.3 million, or 2.0%.

~~Adjusted EBITDA:~~ ~~Adjusted EBITDA decreased $1.3 million, or 9.8%, to $12.0 million for three months ended September 30, 2022 from $13.3 million for the three months ended September 30, 2021~~quarter driven by a reduction in new container purchases during 2023 given current utilization and the Adjusted EBITDA margin percentage contracted to 45.8% from 47.2%. The decrease resulted from the unfavorable gross profit discussed above driven by unfavorable currency fluctuations, partially offset by decreased SG&A of $1.1 million. In local currency, Adjusted EBITDA increased £0.6 million, or 5.7%.

~~Capital Expenditures for Rental Equipment:~~ Purchases of rental equipment and refurbishments decreased $7.0 million, or 60.3%, to $4.6 million for the three months ended September 30, 2022 from $11.6 million for the three months ended September 30, 2021. Net Fleet CAPEX decreased $7.1 million, or 62.7%, to $4.2 million. The decrease in purchases of rental equipment and refurbishments was driven primarily by decreased purchases of portable storage containers as compared to the prior year.

~~Comparison of Nine Months Ended September 30, 2022 and 2021~~

Nine Months Ended September 30, 2022
(in thousands, except for units on rent and rates) NA Modular NA Storage UK Storage Total
Revenue $ 1,022,720 $ 529,347 $ 80,272 $ 1,632,339
Gross profit $ 439,573 $ 367,585 $ 51,457 $ 858,615
Adjusted EBITDA $ 372,502 $ 243,282 $ 36,745 $ 652,529
Capital expenditures for rental equipment $ 221,111 $ 95,699 $ 21,824 $ 338,634
Average modular space units on rent 86,310 18,223 8,470 113,003
Average modular space utilization rate 67.5 % 74.7 % 72.0 % 68.9 %
Average modular space monthly rental rate $ 936 $ 673 $ 409 $ 853
Average portable storage units on rent 498 161,331 27,612 189,441
Average portable storage utilization rate 56.5 % 86.0 % 89.8 % 86.4 %
Average portable storage monthly rental rate $ 201 $ 184 $ 92 $ 171

Nine Months Ended September 30, 2021
(in thousands, except for units on rent and rates) NA Modular NA Storage UK Storage Total
Revenue $ 854,657 $ 357,439 $ 83,538 $ 1,295,634
Gross profit $ 356,992 $ 240,836 $ 53,306 $ 651,134
Adjusted EBITDA $ 307,741 $ 154,971 $ 36,647 $ 499,359
Capital expenditures for rental equipment $ 120,288 $ 24,165 $ 22,645 $ 167,098
Average modular space units on rent 84,589 16,371 9,256 110,216
Average modular space utilization rate 67.6 % 78.5 % 83.8 % 70.2 %
Average modular space monthly rental rate $ 790 $ 570 $ 428 $ 727
Average portable storage units on rent 9,566 118,598 25,284 153,448
Average portable storage utilization rate 64.1 % 78.0 % 90.0 % 78.7 %
Average portable storage monthly rental rate $ 129 $ 152 $ 86 $ 140

~~NA Modular~~

~~Revenue:~~ Total revenue increased $168.1 million, or 19.7%, to $1,022.8 million for the nine months ended September 30, 2022 from $854.7 million for the nine months ended September 30, 2021. The increase was primarily the result of a $119.3 million, or 18.7%, increase in leasing revenue, a $52.2 million, or 32.3%, increase in delivery and installation revenues and a $3.2 million, or 11.3%, increase in rental unit sales revenue. The increases to leasing revenue and delivery and installation revenues were partially offset by declines in revenues for portable storage units in the first and second quarters of 2022 as a result of transitioning the majority of the portable storage product business within the NA Modular segment to the NA Storage segment during the third quarter of 2021. Approximately 12,000 units were transferred during the third quarter of 2021 to the NA Storage segment, reallocating approximately $10.0 million of revenue from NA Modular segment to the NA Storage segment in the first six months of 2022 relative to the first six months of 2021. Average modular space monthly rental rates increased 18.5% for the nine months ended September 30, 2022 to $936 driven by the continuation of our long-term price optimization initiative and VAPS penetration opportunities across our portfolio. In addition to improved pricing, average modular space units on rent increased by 1,721 units, or 2.0%, year over year driven primarily by acquisitions.

~~Gross Profit:~~ Gross profit increased $82.6 million, or 23.1%, to $439.6 million for the nine months ended September 30, 2022 from $357.0 million for the nine months ended September 30, 2021. The increase in gross profit was driven by higher leasing gross profit, which increased $77.7 million, or 16.7%, driven by improved pricing including VAPS and increased modular unit on rent volumes, partially offset by the transfer of portable storage units to the NA Storage segment discussed above, and a $25.2 million increase in delivery and installation gross profit driven by volumes and improved pricing. These increases were further complemented by a $0.5 million increase in new sales gross profit and $1.7 million increase in rental unit sales gross profit. These increases were partially offset by a $22.5 million increase in depreciation of rental equipment related to capitalsignificant investments made in ~~our rental equipment and due to fleet acquired as part of acquisitions.~~

~~Adjusted EBITDA:~~ Adjusted EBITDA increased $64.8 million, or 21.0%, to $372.5 million for the nine months ended September 30, 2022 from $307.7 million for the nine months ended September 30, 2021. The increase was driven by higher leasing gross profit discussed above. SG&A, excluding discrete items, increased $50.0 million, or 26.0%, for the nine months ended September 30, 2022, as compared to the nine months ended September 30, 2021 to support higher staffing levels for both organic and inorganic growth, wage increases, and increased variable compensation as a result of the growth achieved, increased office and occupancy costs, increased travel expenses, and increased subscription, legal and professional fees.

~~Capital Expenditures for Rental Equipment:~~ Purchases of rental equipment and refurbishments increased $100.8 million, or 83.8%, to $221.1 million for the nine months ended September 30, 2022 from $120.3 million for the nine months ended September 30, 2021. These increases were driven by increased refurbishments, and increased new fleet and VAPS purchase volumes, further increased by inflationary pressures.

~~NA Storage~~

~~Revenue:~~ Total revenue increased $171.9 million, or 48.1%, to $529.4 million for the nine months ended September 30, 2022 from $357.5 million for the nine months ended September 30, 2021. The increase was primarily the result of a $142.0 million, or 53.1%, increase in leasing revenue, and a $36.5 million, or 49.9%, increase in delivery and installation revenues. These increases were partially offset by a decrease in rental unit sales revenue of $5.3 million, or 46.5%. Average portable storage monthly rental rates increased 21.1% for the nine months ended September 30, 2022 to $184 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 units on rent increased by 42,733 units, or 36.0%, year over year, driven by increased organic economic activity of approximately 17,500 average units on rent, approximately 17,000 average units on rent acquired from acquisitions, and due to the transfer of approximately 12,000 portable storage units on rent from the NA Modular segment, which occurred in the third quarter of 2021 (8,000 average units on rent impact). Average modular space monthly rental rates increased 18.1% for the nine months ended September 30, 2022 to $673 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 1,852 units, or 11.3%, year over year, of which approximately 30% was acquisition driven.

~~Gross Profit:~~ Gross profit increased $126.8 million, or 52.7%, to $367.6 million for the nine months ended September 30, 2022 from $240.8 million for the nine months ended September 30, 2021. Gross profit on leasing activity increased by $116.8 million year-over-year driven by both increased volume and increased pricing as described above. For delivery and installation, gross profit increased $17.9 million. Sales gross profit decreased by $3.5 million to $3.5 million.

~~Adjusted EBITDA:~~ Adjusted EBITDA increased $88.3 million, or 57.0%, to $243.3 million for the nine months ended September 30, 2022 from $155.0 million for the nine months ended September 30, 2021. The increase was driven by higher leasing gross profit discussed above. SG&A, excluding discrete items, increased $40.6 million, or 38.4%, for the nine months ended September 30, 2022, as compared to the nine months ended September 30, 2021 to support higher staffing levels for both organic and inorganic growth, wage increases, and increased variable compensation as a result of the growth achieved, increased office and occupancy costs, increased travel expenses, and increased subscription, legal and professional fees.

~~Capital Expenditures for Rental Equipment:~~ ~~Purchases of rental equipment and refurbishments increased $71.5 million, or 295.5%, to $95.7 million for the nine months ended September 30, 2022 from $24.2 million for the nine months~~

ended September 30, 2021. The increase in purchases of rental equipment and refurbishments was driven primarily by increased purchases of portable storage containers during the period to support organic growth.

~~UK Storage~~

~~Revenue:~~ Total revenue decreased $3.2 million, or 3.9%, to $80.3 million for the nine months ended September 30, 2022 from $83.5 million for the nine months ended September 30, 2021 due to the strengthening of the U.S. Dollar. The decrease was primarily the result of a $1.8 million, or 66.7%, decrease in new unit sales revenue and a $0.6 million, or 3.3%, decrease in delivery and installation revenues. In local currency, total revenue increased £3.6 million, driven by a £3.8 million increase in leasing revenue, and a £0.9 million increase in delivery and installation revenue, partially offset by a £1.1 million decrease in sales revenue. Average portable storage monthly rental rates increased 7.0% for the nine months ended September 30, 2022 to $92. Average portable storage units on rent increased by 2,328 units, or 9.2%, year over year. Average modular space monthly rental rates decreased 4.4% for the nine months ended September 30, 2022 to $409. Average modular space units on rent decreased by 786 units, or 8.5%, year over year. In local currency, average portable storage monthly rental rates decreased 5.2% for the nine months ended September 30, 2022 to £73, and average modular space monthly rental rates decreased 13.3% for the nine months ended September 30, 2022 to £325.

~~Gross Profit:~~ Gross profit decreased $1.8 million, or 3.4%, to $51.5 million for the nine months ended September 30, 2022 from $53.3 million for the nine months ended September 30, 2021 due to the strengthening of the U.S. Dollar. Gross profit on leasing activity decreased by $0.3 million year-over-year. For delivery and installation, gross profit decreased $1.2 million. Sales gross profit decreased by $0.2 million to $0.7 million. In local currency, gross profit increased £2.4 million, or 6.4% for the nine months ended September 30, 2022 from £38.5 million. Gross profit on leasing activity increased by £3.3 million. For delivery and installation, gross profit decreased £0.4 million. Sales gross profit decreased by £0.1 million to £0.6 million.

~~Adjusted EBITDA:~~ Adjusted EBITDA increased $0.1 million, or 0.3%, to $36.7 million for the nine months ended September 30, 2022 from $36.6 million for the nine months ended September 30, 2021. The increase was driven by higher leasing gross profit discussed above. SG&A, excluding discrete items, decreased $1.8 million, or 9.0%, for the nine months ended September 30, 2022, as compared to the nine months ended September 30, 2021. In local currency, Adjusted EBITDA increased £2.8 million, or 10.6%.

~~Capital Expenditures for Rental Equipment:~~ Purchases of rental equipment and refurbishments decreased $0.8 million, or 3.5%, to $21.8 million for the nine months ended September 30, 2022 from $22.6 million for the nine months ended September 30, 2021.2022.

~~Reconciliation of~~Other Non-GAAP Financial ~~Measures~~Data and Reconciliations

In addition to using GAAP financial measurements, we use certain non-GAAP financial measures to evaluate our operating results. As such, we include in this Quarterly Report on Form 10-Q reconciliations of non-GAAP financial measures to their most directly comparable GAAP financial measures. Set forth below are definitions and reconciliations to the nearest comparable GAAP measure of certain non-GAAP financial measures used in this Quarterly Report on Form 10-Q along with descriptions of why we believe these measures provide useful information to investors as well as a description of the limitations of these measures. Each of these non-GAAP financial measures has limitations as an analytical tool and should not be considered in isolation from, or as a substitute for analysis of, results reported under GAAP. Our measurements of these metrics may not be comparable to similarly titled measures of other companies.

Adjusted EBITDA

We define EBITDA as net income (loss) plus ~~net~~ interest (income) expense, income tax expense (benefit), depreciation and amortization. Our adjusted EBITDA ("Adjusted EBITDA") reflects the following further adjustments to EBITDA to exclude certain non-cash items and the effect of what we consider transactions or events not related to our core business operations:

•Currency (gains) losses, ~~net:~~net on monetary assets and liabilities denominated in foreign currencies other than the subsidiaries’ functional currency. ~~Substantially all such currency gains (losses) are unrealized and attributable to financings due to and from affiliated companies.~~

•Goodwill and other impairment charges related to non-cash costs associated with impairment charges to goodwill, other intangibles, rental fleet and property, plant and equipment.

•Restructuring costs, lease impairment expense, and other related charges associated with restructuring plans designed to streamline operations and reduce costs including employee and lease termination costs.

•Transaction costs including legal and professional fees and other transaction specific related costs.

•Costs to integrate acquired companies, including outside professional fees, non-capitalized costs associated with system integrations, non-lease branch and fleet relocation expenses, employee training costs, and other costs required to realize cost or revenue synergies.

•Non-cash charges for stock compensation plans.

•~~Gains and losses resulting from changes in fair value and extinguishment of common stock warrant liabilities.~~

•Other expense, including consulting expenses related to certain one-time projects, financing costs not classified as interest expense, and gains and losses on disposals of property, plant, and equipment.

Our Chief Operating Decision Maker ("CODM") evaluates business segment performance utilizing Adjusted EBITDA as shown in the reconciliation of the Company’s consolidated income from continuing operations to Adjusted EBITDA below. Management believes that evaluating segment performance excluding such items is meaningful because it provides insight with respect to the intrinsic and ongoing operating results of the Company and captures the business performance of the segments, inclusive of indirect costs.

Adjusted EBITDA has limitations as an analytical tool, and you should not consider the measure in isolation or as a substitute for net income (loss), cash flow from operations or other methods of analyzing WillScot Mobile Mini’s results as reported under GAAP. 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~~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~~Other companies in our industry may calculate Adjusted EBITDA differently, limiting its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA should not be considered as discretionary cash available to reinvest in the growth of our business or as ~~measures~~a measure of cash that will be available to meet our obligations.

The following ~~table provides~~tables provide unaudited reconciliations of Income from continuing operations to Adjusted EBITDA:

Three Months Ended Nine Months Ended
September 30, September 30,
(in thousands) 2022 2021 2022 2021
Income from continuing operations $ 85,728 $ 57,113 $ 200,099 $ 75,278
Income tax expense from continuing operations 30,219 5,243 67,167 32,341
Loss on extinguishment of debt — — — 5,999
Fair value loss on common stock warrant liabilities — — — 26,597
Interest expense 38,165 29,006 102,362 87,793
Depreciation and amortization 86,225 69,449 243,123 216,820
Currency losses, net 236 127 247 196
Restructuring costs, lease impairment expense and other related charges — 2,457 168 14,284
Transaction costs — 303 35 1,147
Integration costs 3,902 8,242 13,182 23,206
Stock compensation expense 7,180 6,157 22,628 14,305
Other (316) 1,106 3,518 1,393
Adjusted EBITDA $ 251,339 $ 179,203 $ 652,529 $ 499,359

~~Income From Continuing Operations Excluding Gain/Loss from Warrants~~

We define Income from Continuing Operations Excluding Gain/Loss from Warrants as income from continuing operations plus or minus the impact of the change in the fair value of the common stock warrant liability. Management believes that the presentation of our financial statements excluding the impact of the mark-to-market adjustment provides useful information regarding our results of operations and assists in the review of our actual operating performance. The following table provides unaudited reconciliations of Income from Continuing Operations to Income from Continuing Operations Excluding Gain/Loss from Warrants:

Three Months Ended September 30, Nine Months Ended September 30,
(in thousands) 2022 2021 2022 2021
Income from Continuing Operations $ 85,728 $ 57,113 $ 200,099 $ 75,278
Fair value loss on common stock warrant liabilities — — — 26,597
Income from Continuing Operations Excluding Gain/Loss from Warrants $ 85,728 $ 57,113 $ 200,099 $ 101,875


	Three Months Ended March 31,
(in thousands)	2023		2022
Income from continuing operations	$	76,271	$	39,048
Income tax expense from continuing operations	30,510		12,083

Interest expense	44,866		30,570
Depreciation and amortization	76,329		72,910

Currency losses, net	6,775		137
Restructuring costs, lease impairment expense and other related charges	22		263
Transaction costs	—		13
Integration costs	3,873		4,087
Stock compensation expense	8,150		6,273
Other	46		2,389
Adjusted EBITDA from continuing operations	$	246,842	$	167,773

Adjusted EBITDA Margin

We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue. ~~Income from Continuing Operations Margin is defined as Income from continuing operations divided by revenue.~~ Management believes that the presentation of Adjusted EBITDA ~~Margin and Income from Continuing Operations~~ Margin provides useful information to investors regarding the performance of our business. The following table provides unaudited reconciliations of Adjusted EBITDA ~~Margin and Income from Continuing Operations~~ Margin:


		Three Months Ended September 30,						Nine Months Ended September 30,							Three Months Ended March 31,
(in thousands)	(in thousands)	2022			2021			2022			2021			(in thousands)	2023			2022
Adjusted EBITDA (A)		$	251,339		$	179,203		$	652,529		$	499,359
Adjusted EBITDA from continuing operations (A)														Adjusted EBITDA from continuing operations (A)	$	246,842		$	167,773
Revenue (B)	Revenue (B)	604,173			461,047			1,632,339			1,295,634			Revenue (B)	$	565,468		$	451,171
Adjusted EBITDA Margin (A/B)		41.6		%	38.9		%	40.0		%	38.5		%
Adjusted EBITDA Margin from Continuing Operations (A/B)														Adjusted EBITDA Margin from Continuing Operations (A/B)	43.7		%	37.2		%
Income from continuing operations (C)	Income from continuing operations (C)	$	85,728		$	57,113		$	200,099		$	75,278		Income from continuing operations (C)	$	76,271		$	39,048
Income from Continuing Operations Margin (C/B)	Income from Continuing Operations Margin (C/B)	14.2		%	12.4		%	12.3		%	5.8		%	Income from Continuing Operations Margin (C/B)	13.5		%	8.7		%

~~Adjusted Gross Profit and Adjusted Gross Profit Percentage~~

We define Adjusted Gross Profit as gross profit plus depreciation on rental equipment. Adjusted Gross Profit Percentage is defined as Adjusted Gross Profit divided by revenue. Adjusted Gross Profit and Adjusted Gross Profit Percentage are not measurements of our financial performance under GAAP and should not be considered as an alternative to gross profit, gross profit percentage, or other performance measures derived in accordance with GAAP. In addition, our measurement of Adjusted Gross Profit and Adjusted Gross Profit Percentage may not be comparable to similarly titled measures of other companies. Management believes that the presentation of Adjusted Gross Profit and Adjusted Gross Profit Percentage provides useful information to investors regarding our results of operations and assists in analyzing the performance of our business.

~~The following table provides unaudited reconciliations of gross profit to Adjusted Gross Profit and Adjusted Gross Profit Percentage:~~

Three Months Ended Nine Months Ended
September 30, September 30,
(in thousands) 2022 2021 2022 2021
Revenue (A) $ 604,173 $ 461,047 $ 1,632,339 $ 1,295,634
Gross profit (B) $ 314,332 $ 239,226 $ 858,615 $ 651,134
Depreciation of rental equipment 69,159 52,990 192,228 165,027
Adjusted Gross Profit (C) $ 383,491 $ 292,216 $ 1,050,843 $ 816,161
Gross Profit Percentage (B/A) 52.0 % 51.9 % 52.6 % 50.3 %
Adjusted Gross Profit Percentage (C/A) 63.5 % 63.4 % 64.4 % 63.0 %

Net CAPEX

We define ~~Net~~Net CAPEX as purchases of rental equipment and refurbishments and purchases of property, plant and equipment (collectively, "Total Capital Expenditures"), less proceeds from the sale of rental equipment and proceeds from the sale of property, plant and equipment (collectively, "Total Proceeds"), which are all included in cash flows from investing activities. Management believes that the presentation of Net CAPEX provides useful information ~~to investors~~ regarding the net capital invested ~~into~~in our rental fleet and property, plant ~~property~~ and equipment each year to assist in analyzing the performance of our business. As presented below, Net CAPEX includes amounts for the former Tank and Pump segment through September 30, 2022 and the former UK Storage Solutions segment through January 31, 2023.

The following ~~table provides~~tables provide unaudited reconciliations of Net CAPEX:


		Three Months Ended				Nine Months Ended
		September 30,				September 30,					Three Months Ended March 31,
(in thousands)	(in thousands)	2022		2021		2022		2021		(in thousands)	2023		2022
Total purchases of rental equipment and refurbishments	Total purchases of rental equipment and refurbishments	$	(135,076)	$	(60,374)	$	(360,465)	$	(178,191)	Total purchases of rental equipment and refurbishments	$	(47,128)	$	(95,236)
Total proceeds from sale of rental equipment	Total proceeds from sale of rental equipment	17,183		11,597		52,263		42,034		Total proceeds from sale of rental equipment	7,781		14,554
Net CAPEX for Rental Equipment	Net CAPEX for Rental Equipment	(117,893)		(48,777)		(308,202)		(136,157)		Net CAPEX for Rental Equipment	(39,347)		(80,682)
Purchases of property, plant and equipment		(10,000)		(3,386)		(30,253)		(20,836)
Purchase of property, plant and equipment										Purchase of property, plant and equipment	(6,736)		(10,481)
Proceeds from sale of property, plant and equipment	Proceeds from sale of property, plant and equipment	894		209		1,645		16,647		Proceeds from sale of property, plant and equipment	258		260
Net CAPEX	Net CAPEX	$	(126,999)	$	(51,954)	$	(336,810)	$	(140,346)	Net CAPEX	$	(45,825)	$	(90,903)

Liquidity and Capital Resources

Overview

WillScot Mobile Mini is a holding company that derives its operating cash flow from its operating subsidiaries. Our principal sources of liquidity include cash generated by operating activities from our subsidiaries, borrowings under ~~the~~our ABL Facility, ~~(as defined below),~~ and sales of equity and debt securities. We believe that our liquidity sources and operating cash flows are sufficient to address our operating, debt service and capital requirements over the next twelve months.

We have consistently accessed the debt and equity capital markets both opportunistically and as necessary to support the growth of our business, desired leverage levels, and other capital allocation priorities. We believe we have ample liquidity in the ABL Facility and are generating substantial free cash flow, which together support both organic operations and other capital allocation priorities as they arise.

We continue to review available acquisition opportunities with the awareness that any such acquisition may require us to incur additional debt to finance the acquisition and/or to issue shares of our Common Stock or other equity securities as acquisition consideration or as part of an overall financing plan. In addition, we will continue to evaluate alternatives to optimize our capital structure, which could include the issuance or repurchase of additional unsecured and secured debt, equity securities and/or equity-linked securities. There can be no assurance as to the timing of any such issuance or repurchase. If we obtain additional capital by issuing equity, the interests of our existing stockholders will be diluted. If we incur additional indebtedness, that indebtedness may contain significant financial and other covenants that may significantly restrict our operations. Availability of financing and the associated terms are inherently dependent on the debt and equity capital markets and subject to change. From time to time, we may also seek to streamline our capital structure and improve our financial

position through refinancing or restructuring our existing debt or retiring certain of our securities for cash or other consideration.

Our revolving credit facility provides an aggregate principal amount of up to $3.7 billion, consisting of: (i) a senior secured asset-based US dollar revolving credit facility in the aggregate principal amount of $3.3 billion (the “US Facility”), and (ii) a $400.0 million senior secured asset-based multicurrency revolving credit facility (the "Multicurrency ~~Facility")~~Facility," and together with the US Facility, ~~(collectively,~~ the “ABL Facility”)~~, available to be drawn in US Dollars, Canadian Dollars, British Pounds Sterling or Euros.~~. 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.~~pool, of which our rental equipment represents the largest component. At ~~September 30, 2022,~~March 31, 2023, we had ~~$1.9~~$1.1 billion ~~outstanding principal and $1.1 billion~~ of available borrowing capacity under the ABL Facility.

Cash Flow Comparison ~~for~~of the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~

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 former 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 and former UK Storage Solutions segments.

The following summarizes our change in cash and cash equivalents for the periods presented:


		Nine Months Ended September 30,					Three Months Ended March 31,
(in thousands)	(in thousands)	2022		2021		(in thousands)	2023		2022
Net cash from operating activities		$	544,238	$	392,055
Net cash from investing activities		(225,930)		(196,590)
Net cash from financing activities		(313,723)		(208,935)
Net cash provided by operating activities						Net cash provided by operating activities	$	148,765	$	145,527
Net cash provided by (used in) investing activities						Net cash provided by (used in) investing activities	271,949		(148,360)
Net cash (used in) provided by financing activities						Net cash (used in) provided by financing activities	(423,087)		1,586
Effect of exchange rate changes on cash and cash equivalents	Effect of exchange rate changes on cash and cash equivalents	(1,842)		(150)		Effect of exchange rate changes on cash and cash equivalents	517		(131)
Net change in cash and cash equivalents	Net change in cash and cash equivalents	$	2,743	$	(13,620)	Net change in cash and cash equivalents	$	(1,856)	$	(1,378)

Cash Flows from Operating Activities

Cash provided by operating activities for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 was ~~$544.2~~$148.8 million as compared to ~~$392.1~~$145.5 million for the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, an increase of ~~$152.2 million, or 38.8%.~~$3.2 million. The increase was due to an increase of ~~$157.5~~$37.3 million of net income, adjusted for non-cash items, ~~partially offset by~~and a decrease of ~~$5.2~~$34.1 million in the net ~~changes in~~movements of the operating assets and liabilities.

Cash Flows from Investing Activities

Cash ~~used in~~provided by investing activities for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 was ~~$225.9~~$271.9 million as compared to ~~$196.6 million for the nine months ended September 30, 2021, an increase of $29.3 million. The increase in~~ cash used in investing activities of $148.4 million for the three months ended March 31, 2022, an increase of $420.3 million in cash provided by investing activities. The increase in cash provided by investing activities was driven by proceeds of $404.0

million from the sale of discontinued operations, a ~~$182.3~~$48.1 million ~~increase~~decrease in cash used for the purchase of rental equipment and refurbishments, and a ~~$152.4~~$3.7 million decrease in cash used for the purchase of property, plant and equipment. The increase was partially offset by a $21.0 million increase in cash used in acquisitions, net of cash acquired, a ~~$15.0~~cash payment of $7.7 million ~~decrease in proceeds from sale~~for the settlement of ~~property, plant and equipment,~~the contingent foreign currency forward contract, and a ~~$9.5~~$6.8 million ~~increase in cash used for the purchase of property, plant and equipment, partially offset by a $319.5 million increase in proceeds from sale of Tank and Pump business and a $10.3 million increase~~decrease in proceeds from the sale of rental equipment.

Cash Flows from Financing Activities

Cash used in financing activities for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 was ~~$313.7~~$423.1 million as compared to ~~$208.9~~cash provided by financing activities of $1.6 million for the ~~nine~~three months ended ~~September 30, 2021, an increase~~March 31, 2022, a change of ~~$104.8~~$424.7 million. The ~~increase~~change was primarily due to a ~~$195.1~~$499.3 million increase in repayments of borrowings and a $137.4 million increase in the repurchase ~~and cancellation~~ of common stock ~~and warrants, an $87.1 million increase in repayment of borrowings, and a $27.0 million increase in principal payments on finance lease obligations, partially~~ offset by a ~~$212.1~~$211.3 million increase in receipts from borrowings.

Free Cash Flow

Free Cash Flow is a non-GAAP measure. We define Free Cash Flow as net cash provided by operating activities, less purchases of, and proceeds from, rental equipment and property, plant and equipment, which are all included in cash flows from investing activities. Management believes that the presentation of Free Cash Flow provides useful additional information concerning cash flow available to fund our capital allocation alternatives.

The following table provides ~~reconciliations~~a reconciliation of net cash provided by operating activities to Free Cash Flow.


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
(in thousands)	(in thousands)	2022		2021		2022		2021		(in thousands)	2023		2022
Net cash provided by operating activities	Net cash provided by operating activities	$	210,385	$	130,447	$	544,238	$	392,055	Net cash provided by operating activities	$	148,765	$	145,527
Purchase of rental equipment and refurbishments	Purchase of rental equipment and refurbishments	(135,076)		(60,374)		(360,465)		(178,191)		Purchase of rental equipment and refurbishments	(47,128)		(95,236)
Proceeds from sale of rental equipment	Proceeds from sale of rental equipment	17,183		11,597		52,263		42,034		Proceeds from sale of rental equipment	7,781		14,554
Purchases of property, plant and equipment		(10,000)		(3,386)		(30,253)		(20,836)
Purchase of property, plant and equipment										Purchase of property, plant and equipment	(6,736)		(10,481)
Proceeds from the sale of property, plant and equipment	Proceeds from the sale of property, plant and equipment	894		209		1,645		16,647		Proceeds from the sale of property, plant and equipment	258		260
Free Cash Flow	Free Cash Flow	$	83,386	$	78,493	$	207,428	$	251,709	Free Cash Flow	$	102,940	$	54,624

Free Cash flow from operations increased by $152.2 million or 38.8% for the nine months ended September 30, 2022 as compared to the nine months ended September 30, 2021. Cash used in investing activities excluding acquisitions and sale of discontinued operations increased by $196.4 million to support unit on rent and VAPS growth with leasing revenues up 27.0% year-over-year. Cash flow from operations increased by $79.8 million, or 61.1%Flow for the three months ended ~~September 30, 2022~~March 31, 2023 was $102.9 million as compared to $54.6 million for the three months ended ~~September 30, 2021. This~~March 31, 2022, an increase ~~was supported~~of $48.3 million. Free Cash Flow increased year over year principally as a result of the $3.2 million increase in cash provided by operating activities and the $48.1 million decrease in cash used in the purchase of rental equipment and refurbishments, partially offset by the ~~30.6% increase~~$6.8 million decrease in ~~leasing revenue year-over-year. Free~~proceeds from the sale of rental equipment. The $148.8 million in cash ~~flow of $207.4 million~~provided by operating activities for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 was ~~down $44.3~~returned to shareholders through repurchases and cancellations of $215.1 million ~~as compared~~of stock and reinvested into the business to support the ~~nine months ended September 30, 2021 which is consistent with the counter cyclicality~~purchase of ~~free cash flow in our business.~~rental equipment, including VAPS, and refurbishments.

Material cash requirements

The Company’s material cash requirements include the following contractual and other obligations:

Debt

The Company has outstanding debt related to its ABL Facility, 2025 Secured Notes, 2028 Secured Notes and finance leases, including interest, totaling ~~$3.0~~$2.9 billion as of ~~September 30, 2022,~~March 31, 2023, $13.5 million of which is obligated to be repaid within the next twelve months. Refer to Note 109 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 ~~September 30, 2022,~~March 31, 2023, the Company had lease obligations of ~~$264.7~~$260.0 million, with $60.0 million payable within the next twelve months.

In addition to the ~~aforementioned~~ cash requirements described above, the Company has a ~~Share Repurchase Program~~share repurchase program authorized by the Board of Directors, which allows the Company to repurchase up to $1.0 billion of outstanding shares of Common Stock and equivalents. This program does not obligate the Company to repurchase any specific amount of shares. As of March 31, 2023, $415.1 million of the approved share repurchase pool remained available.

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 ~~for~~over the ~~foreseeable future.~~next twelve months.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition, results of operations, liquidity and capital resources is based on our condensed consolidated financial statements, which have been prepared in accordance with GAAP. 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. The actual results experienced by us may differ materially and adversely from our estimates.

The US Securities and Exchange Commission (the “SEC”) suggests companies provide additional disclosure on those accounting policies considered most critical. The SEC considers an accounting policy to be critical if it is important to our financial condition and results of operations and requires significant judgments and estimates on the part of management in its application. For a complete discussion of our significant critical accounting policies, see the “Critical Accounting Policies and Estimates” section in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, ~~2021~~2022 (the ~~"2021~~"2022 Annual Report on Form 10-K").

There were no significant changes to our critical accounting policies during the ~~nine~~three months ended ~~September 30, 2022.~~March 31, 2023.

Recently Issued Accounting Standards

Refer to Part I, Item 1, Note 1 of the notes to our financial statements included in this Quarterly Report on Form 10-Q for our assessment of recently issued and adopted accounting standards.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Act of 1934, as amended. The words “estimates,” “expects,” “anticipates,” “believes,” “forecasts,” “plans,” “intends,” “may,” “will,” “should,” “shall,” “outlook,” “guidance” and variations of these words and similar expressions identify forward-looking statements, which are generally not historical in nature and relate to expectations for future financial performance or business strategies or objectives. Forward-looking statements are subject to a number of risks, uncertainties, assumptions and other important factors, many of which are outside our control, which could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Although ~~we believe~~WillScot Mobile Mini believes that these forward-looking statements are based on reasonable assumptions, weit can give no assurance that any such forward-looking statement will materialize. Important factors that may affect actual results or outcomes include, among others:

•various laws and regulations and recent pronouncements related to laws and regulations governing antitrust, climate related disclosures, cybersecurity, privacy, government contracts, anti-corruption and the environment;

•our ability to successfully acquire and integrate new operations;

•the effect of global or local economic conditions in the industries and markets in which the Company operates and any changes therein, including financial market conditions and levels of end market demand;

•~~operational, economic, political and regulatory risks;~~

•~~the impact of public health crises, such as the global pandemic related to COVID-19, including the financial condition of the Company’s customers and suppliers and employee health and safety;~~

•risks associated with cybersecurity and IT systems disruptions, including our ability to manage the business in the event a disaster shuts down our management information systems;

•~~effective management of our rental equipment;~~

•trade policies and changes in trade policies, including the imposition of tariffs, their enforcement and downstream consequences;

•our ability to effectively compete in the modular space and portable storage industries;

•our ability to effectively manage our credit risk, collect on our accounts receivable, or recover our rental equipment;

•~~the effect of changes in state building codes on our ability to remarket our buildings;~~

•~~foreign currency exchange rate exposure;~~

•fluctuations in interest rates and commodity prices;

•~~significant increases in the costs and restrictions on the availability of raw materials and labor;~~

•~~fluctuations in fuel costs or oil prices, a reduction in fuel supplies, or a sustained decline in oil prices;~~

•~~our reliance on third party manufacturers and suppliers;~~

•risks associated with labor relations, labor costs and labor disruptions;

•~~impairment of our goodwill, intangible assets and indefinite-life intangible assets;~~

•~~various laws and regulations, including those governing government contracts, corruption and the environment;~~

•changes in the competitive environment of our customer base as a result of the global, national or local economic climate in which they operate and/or economic or financial disruptions to their industry;

•our ability to adequately protect our intellectual property and other proprietary rights that are material to our business;

•natural disasters and other business disruptions such as pandemics, fires, floods, hurricanes, earthquakes and terrorism;

•our ability to establish and maintain the appropriate physical presence in our markets;

•property, casualty or other losses not covered by our insurance;

•our ability to close our unit sales transactions;

•our ability to maintain an effective system of internal controls and accurately report our financial results;

•evolving public disclosure, financial reporting and corporate governance expectations;

•our ability to achieve our environmental, social and governance goals;

•operational, economic, political and regulatory risks;

•effective management of our rental equipment;

•the effect of changes in state building codes on our ability to remarket our buildings;

•foreign currency exchange rate exposure;

•significant increases in the costs and restrictions on the availability of raw materials and labor;

•fluctuations in fuel costs or a reduction in fuel supplies;

•our reliance on third party manufacturers and suppliers;

•impairment of our goodwill, intangible assets and indefinite-life intangible assets;

•our ability to use our net operating loss carryforwards and other tax attributes;

•our ability to recognize deferred tax assets such as those related to our tax loss carryforwards and, as a result, utilize future tax savings;

•unanticipated changes in tax obligations, adoption of a new tax legislation, or exposure to additional income tax liabilities;

•our ability to access the capital and credit markets or the ability of key counterparties to perform their obligations to ~~us:~~us;

•our ability to service our debt and operate our business;

•our ability to incur significant additional amounts of debt, which could further exacerbate the risks associated with our substantial indebtedness;

•covenants that limit our operating and financial flexibility;

•~~uncertainty regarding the phase-out of LIBOR;~~

•our stock price volatility; and

•such other risks and uncertainties described in the periodic reports we file with the SEC from time to time (including our ~~2021~~2022 Annual Report on Form 10-K), which are available through the SEC’s EDGAR system at www.sec.gov and on our website.

Any forward-looking statement speaks only at the date which it is made, and ~~we undertake~~WillScot Mobile Mini undertakes no obligation, and disclaims any obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to certain market risks from changes in foreign currency exchange rates and interest rates. Changes in these factors cause fluctuations in our earnings and cash flows. 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 ~~$1.9~~$1.8 billion in outstanding principal under the ABL Facility at ~~September~~March 31, 2023.

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. The swap agreements provide for us to pay a weighted average effective fixed interest rate of 3.44% per annum and receive a variable interest rate equal to one-month term SOFR, with maturity dates of June 30, ~~2022.~~ 2027. 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.

An increase in interest rates by 100 basis points on our ABL Facility, inclusive of the impact of our interest rate swaps, would increase our quarter to date interest expense by approximately ~~$5.3~~$10.8 million based on current outstanding borrowings.

Foreign Currency Risk

We currently generate ~~the majority~~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 ~~principally~~ through our operations in Canada ~~Mexico,~~ and ~~the United Kingdom.~~Mexico. For the operations outside the US, we bill customers primarily in their local currency, which is subject to foreign currency rate changes. As our net revenues and expenses generated outside of the US increase, our results of operations could be adversely impacted by changes in foreign currency exchange rates. Since we recognize foreign revenues in local foreign currencies, if the US dollar strengthens, it could have a negative impact on our foreign revenues upon translation of those results into the US dollar for consolidation into our financial statements.

In addition, we are exposed to gains and losses resulting from fluctuations in foreign currency exchange rates on transactions generated by our foreign subsidiaries in currencies other than their local currencies. These gains and losses are primarily driven by intercompany transactions and rental equipment purchases denominated in currencies other than the functional currency of the purchasing entity. These exposures are included in currency (gains) losses, net, on the ~~condensed~~ consolidated statements of operations. To date, we have not entered into any hedging arrangements with respect to foreign currency risk.

ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 as amended (the "Exchange Act"), as of ~~September 30, 2022.~~March 31, 2023. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of ~~September 30, 2022.~~March 31, 2023.

Changes in Internal Controls

There were no changes in our internal control over financial reporting that occurred during our quarter ended ~~September 30, 2022~~March 31, 2023 that materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

ITEM 1. Legal Proceedings

The Company is involved in various lawsuits, claims and legal proceedings that arise in the ordinary course of business. The Company assesses these matters on a case-by-case basis as they arise and establishes reserves as required. As of ~~September 30, 2022,~~March 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. However, the outcome of such matters is inherently unpredictable and subject to significant uncertainties.

ITEM 1A. Risk Factors

The Company’s financial position, results of operations and cash flows are subject to various risks, many of which are not exclusively within the Company’s control, which may cause actual performance to differ materially from historical or projected future performance. In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in Item 1A. of our ~~2021~~2022 Annual Report on Form 10-K, which have not materially changed.

ITEM 2. Unregistered Sales of Equity Securities

The following table summarizes our purchase of Common Stock during the ~~third~~first quarter of ~~2022.~~2023. No stock equivalents were purchased by the Company during the ~~third~~first quarter of ~~2022.~~2023.

Period Total Number of Shares and Equivalents Purchased (in thousands) Average Price Paid
per Share Total Number 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 Plans (in millions)
July 1, 2022 to July 31, 2022 2,481.7 $ 33.45 2,481.7 $ 977.7
August 1, 2022 to August 31, 2022 1,025.4 $ 41.36 1,025.4 $ 935.3
September 1, 2022 to September 30, 2022 1,763.4 $ 40.79 1,763.4 $ 863.3
Total 5,270.5 $ 37.44 5,270.5


Period	Total Number of Shares and Equivalents Purchased (in thousands)	Average Price Paid per Share		Total Number 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 Plans (in millions)
January 1, 2023 to January 31, 2023	1,595.0	$	45.78	1,595.0	$	557.8
February 1, 2023 to February 28, 2023	893.5	$	49.76	893.5	$	513.3
March 1, 2023 to March 31, 2023	2,100.8	$	46.73	2,100.8	$	415.1
Total	4,589.3	$	46.99	4,589.3

A share repurchase program authorizes the Company to repurchase its outstanding shares of Common Stock and equivalents. As of ~~September 30, 2022, $863.3~~March 31, 2023, $415.1 million of the $1.0 billion share repurchase authorization remained available for use.

ITEM 3. Defaults Upon Senior Securities

None.

ITEM 4. Mine Safety Disclosures

Not applicable.

ITEM 5. Other Information

A proposal to be included in our proxy statement pursuant to Rule 14a-8 under the Exchange Act must be received at the office of the Corporate Secretary on or before December 23, 2022 (rather than February 3, 2023 as indicated in the proxy statement for our 2022 annual meeting of stockholders). Notice of a proposal submitted pursuant to Rule 14a-8 must also comply with requirements set forth in Rule 14a-8.None.

ITEM 6. Exhibits


Exhibit No.		Exhibit Description
3.1*






		Amended and Restated Certificate of Incorporation of WillScot Mobile Mini Holdings Corp., Amended as of June 3, 2022
31.1*	*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	*	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	**	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	**	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
~~104~~	104	Inline XBRL for the cover page of this Quarterly Report on Form 10-Q, included in the Exhibit 101 Inline XBRL Document Set.

*Filed herewith

**Furnished (and not filed) herewith pursuant to Item 601(b)(32)(ii) of Regulation S-K under the Exchange Act

5341

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		WillScot Mobile Mini Holdings Corp.

		By:	/s/ TIMOTHY D. BOSWELL
Dated:	~~November 3, 2022~~April 27, 2023		Timothy D. Boswell
			President & Chief Financial Officer (Principal Financial Officer and Duly Authorized Signing Officer)

5442


Earnings per share from continuing operations:
Basic	$	0.40	$	0.25	$	0.91	$	0.33
Diluted	$	0.39	$	0.24	$	0.89	$	0.32
Earnings per share from discontinued operations:
Basic	$	0.20	$	0.02	$	0.24	$	0.05
Diluted	$	0.20	$	0.02	$	0.24	$	0.05
Earnings per share:
Basic	$	0.60	$	0.27	$	1.15	$	0.38
Diluted	$	0.59	$	0.26	$	1.13	$	0.37
Weighted average shares:
Basic	213,636,876		225,998,202		219,312,260		227,557,664
Diluted	217,927,725		231,868,397		223,933,319		234,084,800


Nine Months Ended September 30, 2022
	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Shareholders' Equity
(in thousands)	Shares	Amount
Balance at December 31, 2021	223,940	$	22	$	3,616,902	$	(29,071)	$	(1,591,090)	$	1,996,763
Net income	—	—		—		—		51,171		51,171
Other comprehensive loss	—	—		—		(1,753)		—		(1,753)
Stock-based compensation and issuance of Common Stock from vesting	498	—		6,395		—		—		6,395
Repurchase and cancellation of Common Stock and warrants	(2,064)	—		(77,409)		—		—		(77,409)
Issuance of Common Stock from the exercise of options and warrants	800	—		3,313		—		—		3,313
Withholding taxes on net share settlement of stock-based compensation	—	—		(12,295)		—		—		(12,295)
Balance at March 31, 2022	223,174	22		3,536,906		(30,824)		(1,539,919)		1,966,185
Net income	—	—		—		—		73,376		73,376
Other comprehensive loss	—	—		—		(24,452)		—		(24,452)
Stock-based compensation and issuance of Common Stock from vesting	70	—		9,292		—		—		9,292
Repurchase and cancellation of Common Stock and warrants	(7,222)	—		(249,515)		—		—		(249,515)
Issuance of Common Stock from the exercise of options and warrants	69	—		139		—		—		139
Withholding taxes on net share settlement of stock-based compensation	—	—		(1,075)		—		—		(1,075)
Balance at June 30, 2022	216,091	22		3,295,747		(55,276)		(1,466,543)		1,773,950
Net income	—	—		—		—		128,593		128,593
Other comprehensive loss	—	—		—		(37,733)		—		(37,733)
Stock-based compensation and issuance of Common Stock from vesting	26	—		6,941		—		—		6,941
Repurchase and cancellation of Common Stock	(5,271)	—		(197,457)		—		—		(197,457)
Issuance of Common Stock from the exercise of options	398	—		7,363		—		—		7,363
Withholding taxes on net share settlement of stock-based compensation	—	—		(518)		—		—		(518)
Balance at September 30, 2022	211,244	$	22	$	3,112,076	$	(93,009)	$	(1,337,950)	$	1,681,139


Nine Months Ended September 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Shareholders' Equity
(in thousands)	Shares	Amount
Balance at December 31, 2020	229,038	$	23	$	3,852,291	$	(37,207)	$	(1,751,234)	$	2,063,873
Net income	—	—		—		—		4,447		4,447
Other comprehensive income	—	—		—		7,211		—		7,211
Stock-based compensation and issuance of Common Stock from vesting	229	—		4,951		—		—		4,951
Repurchase and cancellation of Common Stock and warrants	(2,793)	—		(76,788)		—		—		(76,788)
Issuance of Common Stock from the exercise of options and warrants	341	—		5,414		—		—		5,414
Withholding taxes on net share settlement of stock-based compensation	—	—		(3,219)		—		—		(3,219)
Balance at March 31, 2021	226,815	23		3,782,649		(29,996)		(1,746,787)		2,005,889
Net income	—	—		—		—		20,371		20,371
Other comprehensive income	—	—		—		5,239		—		5,239
Stock-based compensation and issuance of Common Stock from vesting	60	—		9,038		—		—		9,038
Repurchase and cancellation of Common Stock and warrants	(4,100)	—		(35,508)		—		—		(35,508)
Issuance of Common Stock from the exercise of warrants	4,058	—		384		—		—		384
Balance at June 30, 2021	226,833	23		3,756,563		(24,757)		(1,726,416)		2,005,413
Net income	—	—		—		—		61,103		61,103
Other comprehensive income	—	—		—		(8,956)		—		(8,956)
Stock-based compensation and issuance of Common Stock from vesting	192	—		7,686		—		—		7,686
Repurchase and cancellation of Common Stock and warrants	(3,752)	—		(106,264)		—		—		(106,264)
Issuance of Common Stock from the exercise of warrants	393	—		1,517		—		—		1,517
Withholding taxes on net share settlement of stock-based compensation	—	—		(3,915)		—		—		(3,915)
Balance at September 30, 2021	223,666	$	23	$	3,655,587	$	(33,713)	$	(1,665,313)	$	1,956,584