RSC Reports 2Q09 Results, Provides 3Q09 Outlook and Reaffirms FY09 Free Cash Flow Outlook

SCOTTSDALE, Ariz.--(Business Wire)--
RSC Holdings Inc. (NYSE:RRR):

* Rental revenues $271 million, down 33% vs. 2Q08
* DEPS a loss of $0.11, down from DEPS of $0.39 in 2Q08
* Adjusted EBITDA $108 million, or 33.1% of total revenues
* Free cash flow $95 million
* FY09 free cash flow forecast reaffirmed at $340 - $370 million
* Completed $400 million notes offering and amendment to ABL facility

RSC Holdings Inc. (NYSE:RRR), one of the largest equipment rental providers in
North America, today announced results for the second quarter ended June 30,
2009.

Erik Olsson, President and Chief Executive Officer, stated: "We made progress on
a number of fronts during the second quarter. First and foremost, we delivered
another quarter of strong cash flows and remain on track to meet our free cash
flow guidance of $340 - $370 million for the full year 2009. We continued to
right-size the business to current demand, while also continuing to position the
company for the future with seven new location openings. We executed well on our
priorities and, as a result, demand for our fleet has stabilized over the past
four months and utilization was trending up towards the end of the quarter.
Lastly, we successfully concluded a major refinancing of the company in July,
enhancing liquidity and extending maturities, which will provide significant
financial and operational flexibility going forward."

Second Quarter 2009 Results

Second quarter rental revenues decreased 33.2% to $271 million, from $405
million in the year-ago quarter, and accounted for 83% of total revenues. Total
revenues were $327 million, down 27.3% from $449 million reported in the
year-ago quarter.

Rental volume declined 25.5% from the prior year`s second quarter following the
drop in non-residential construction business levels and lower industrial
activity. Rental rates declined by 7.7% compared with the year-ago quarter.
Fleet utilization averaged 57.5% vs. 71.6% in the second quarter of 2008. The
company generated net capital expenditure inflows of $38 million, continuing to
benefit from a well-maintained and relatively young fleet, which minimized
replacement needs.

Sales of used rental equipment were $42 million, increasing from $25 million in
last year`s second quarter. Gross profit margin on sales of used rental
equipment was 7.0%, similar to first quarter 2009 margins, reflecting
higher-than-normal auction sales and lower retail margins.

The company continued to aggressively manage its cost structure, reducing cost
of rental and SG&A expenses by $43 million versus the second quarter a year ago.
Headcount was reduced by 79 employees, while location closures were limited to
one, as the company had already taken strategic actions to right-size its
footprint in previous quarters. Since the beginning of 2008, the company has
closed 58 or 12% of its locations and reduced headcount by 1,029 or 19%. The
company also opened seven locations in the second quarter, bringing the
year-to-date openings to 14, primarily in locations that presented industrial
growth opportunities. Industrial/non-construction revenues accounted for 55% of
total rental revenues in the second quarter of 2009.

Operating income was $24 million, or 7.2% of total revenues, compared with $114
million or 25.5% of total revenues in the prior year period. The impact of the
rental revenue decline exceeded the benefits of cost reductions. Second quarter
adjusted EBITDA was $108 million or 33.1% of total revenues, compared to $207
million or 46.1% of total revenues last year.

Interest expense was $40 million, a decrease of $9 million from second quarter
2008, due to reduced debt levels and lower interest rates. A second quarter net
loss of $11 million or $0.11 per diluted share was realized, compared with net
income of $40 million or $0.39 per diluted share in the second quarter of 2008.

Free cash flow of $95 million compares with $91 million in the prior year second
quarter. For the first half of 2009, free cash flow of $207 million represents
an improvement of $158 million over $49 million in the first half of the prior
year. Total debt was reduced by $100 million during the second quarter and by
$212 million in the first half of 2009, to $2,357 million.

Capital Structure Transactions

Earlier today the company announced it had completed an amendment of its ABL
revolving facility, extending the maturity of 75%of its senior asset backed
("ABL") revolving credit facility from November 2011 to August 2013 and reduced
the total commitments under the ABL revolving facility to $1.1 billion. This
amendment follows the company`s successful issuance in early July 2009 of $400
million of 8-year senior secured notes with a coupon rate of 10.0%. The net
proceeds were used to repay the entire $243 million term loan portion of the
company`s ABL facility and to pay down outstanding borrowings under the
revolving portion of the ABL credit facility.

Mr. Olsson stated: "These are initial and proactive steps in executing our
strategy to continue to have a flexible and low cost capital structure to
support the near and long term growth in our business. The amendment and
extension of our ABL lending agreement, together with the recent issuance of the
senior secured notes, extend the maturity of the major portion of our ABL
revolver balance to 2013 and another $400 million to 2017. In addition, this
increases the borrowing availability under our ABL facility from $373 million to
$708 million. Maximizing our borrowing availability in this manner provides us
great flexibility to navigate our business through current and future economic
conditions."

Outlook for 3Q09 and FY09

Business activity in the company`s served markets continues to be down on a
year-over-year basis, while declines on a sequential basis appear to be
moderating. Industry-wide fleet levels exceed demand and as a result rental
rates will continue to be under pressure.

The company saw fleet on rent and utilization stabilizing in the second quarter
and utilization improved toward the end of the quarter, while rental rates
continued to be challenging. In general, the company expects these trends to
continue in the third quarter.

The company reaffirms previous full year 2009 free cash flow guidance of $340 -
$370 million and expects to apply available cash to further debt reduction.
Results are expected in the ranges that follow:

Q309
Rental revenues $255 - $270 million
Total revenues $310 - $325 million
Adjusted EBITDA $100 - $115 million
Free cash flow $ 90 - $100 million

FY09
Free cash flow $ 340 - $ 370 million

"The actions we have taken to address our cost structure and optimize free cash
flow are producing expected results. We are on track to reduce operating costs
by more than $150 million and our proven ability to execute on all our
priorities positions us to deliver $340 - $370 million of free cash flow for the
year 2009. At the same time, we continue to focus on the industrial markets,
serving our existing customers and notably, while we have closed a number of
locations, we have also opened 14 new locations this year, positioning us to
emerge even stronger and better when the cycle turns," Mr. Olsson concluded.

Conference Call Information

RSC Holdings will hold a conference call today at 5:15 p.m. Eastern Time.
Investors may access the call by visiting the investor relations portion of the
RSC website at www.RSCrental.com/Investor. To listen to the live conference call
from the U.S. and Canada dial 866-393-7634; from international locations dial
706-679-0678. A replay of the conference call will be available through August
15, 2009. To access the replay dial: U.S. and Canada: 800-642-1687;
international 706-645-9291. Pass code: 19341457. A replay of the webcast will
also be available at www.RSCrental.com/Investor.

Investor Presentation Information

Information concerning our business and financial results that we expect to use
at upcoming investor presentations will be made available on our website
immediately following the conference call and will be maintained on our website
for at least the period of its use at such meetings or until updated by more
current information.

About RSC Holdings Inc. (NYSE: RRR) and RSC Equipment Rental, Inc.

Based in Scottsdale, Ariz., RSC Holdings Inc. is the holding company for the
operating entity, RSC Equipment Rental, Inc., which is one of the largest
equipment rental providers in North America servicing construction and
industrial markets with an original equipment fleet cost of $2.5 billion. RSC
offers superior levels of equipment availability, reliability and service to
customers through an integrated network of 463 rental locations across 40 states
in the United States and in three Canadian provinces as of June 30, 2009. With
4,500 employees committed to continuous safety and 24x7 customer care, RSC
delivers the loyal customer support needed to build the future. Additional
information about RSC is available at www.RSCrental.com.

Forward-Looking Statements

This press release contains certain "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. These statements are based on management`s
current expectations and are subject to uncertainty and changes in factual
circumstances. The forward-looking statements herein include statements
regarding the company`s future financial position, end-market outlook, business
strategy, budgets, projected costs and plans and objectives of management for
future operations.

In addition, forward-looking statements generally can be identified by the use
of forward-looking terminology such as "may", "plan", "seek", "will", "expect",
"intend", "estimate", "anticipate", "believe" or "continue" or the negative
thereof or variations thereon or similar terminology. Actual results and
developments may therefore differ materially from those described in this
release.

The company cautions therefore that you should not rely unduly on these
forward-looking statements. You should understand the risks and uncertainties
discussed in "Risk Factors" and elsewhere in the company`s Annual Report on Form
10-K as filed with the United States Securities and Exchange Commission could
affect the company`s future results and could cause those results or other
outcomes to differ materially from those expressed or implied in the company`s
forward-looking statements.

These forward-looking statements are not guarantees of future performance and
speak only as of the date hereof, and, except as required by law, we disclaim
any obligation to update these forward-looking statements to reflect future
events or circumstances.

Non-GAAP Financial Information

In addition to disclosing financial results that are determined in accordance
with U.S. generally accepted accounting principles ("GAAP"), the company also
discloses in this press release certain non-GAAP financial information including
adjusted EBITDA and free cash flow. These financial measures are not recognized
measures under GAAP and they are not intended to be and should not be considered
in isolation or as a substitute for, or superior to, the financial information
prepared and presented in accordance with GAAP. For more information on these
non-GAAP financial measures, please see the tables captioned "Adjusted EBITDA
GAAP Reconciliation and "Free Cash Flow GAAP Reconciliation" included at the end
of this release. Additionally, explanations of these Non-GAAP measures are
provided in Annex A attached to this release.

RSC HOLDINGS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)

Three Months Ended Six Months Ended
June 30, Change June 30, Change
2009 2008 % 2009 2008 %
Revenues:
Equipment rental revenue $ 270,500 $ 404,843 (33.2) % $ 557,970 $ 777,178 (28.2) %
Sale of merchandise 13,588 18,894 (28.1) 27,488 37,246 (26.2)
Sale of used rental equipment 42,470 25,280 68.0 92,373 56,686 63.0
Total revenues 326,558 449,017 (27.3) 677,831 871,110 (22.2)
Cost of revenues:
Cost of equipment rentals, excluding depreciation 135,365 172,253 (21.4) 284,844 339,090 (16.0)
Depreciation - rental equipment 72,060 79,252 (9.1) 147,323 157,462 (6.4)
Cost of merchandise sales 9,418 12,501 (24.7) 19,418 24,834 (21.8)
Cost of used rental equipment sales 39,505 17,217 129.5 85,297 39,674 115.0
Total cost of revenues 256,348 281,223 (8.8) 536,882 561,060 (4.3)
Gross profit 70,210 167,794 (58.2) 140,949 310,050 (54.5)
Operating expenses:
Selling, general and administrative 35,613 41,388 (14.0) 75,126 80,712 (6.9)
Depreciation and amortization -
non-rental equipment and intangibles 11,194 12,413 (9.8) 22,976 24,611 (6.6)
Other operating gains, net (222) (445) (50.1) (114) (1,065) (89.3)
Total operating expenses, net 46,585 53,356 (12.7) 97,988 104,258 (6.0)
Operating income 23,625 114,438 (79.4) 42,961 205,792 (79.1)
Interest expense, net 40,035 48,742 (17.9) 80,245 104,103 (22.9)
Other expense (income), net 107 (16) n/a 410 (643) n/a
(Loss) income before (benefit) provision for income taxes (16,517) 65,712 n/a (37,694) 102,332 n/a
(Benefit) provision for income taxes (5,027) 25,635 n/a (12,700) 39,910 n/a
Net (loss) income $ (11,490) $ 40,077 n/a $ (24,994) $ 62,422 n/a

Weighted average shares outstanding used in computing net (loss) income per common share:
Basic 103,435 103,232 103,432 103,192
Diluted 103,435 103,935 103,432 103,908

Net (loss) income per common share:
Basic and Diluted $ (0.11) $ 0.39 $ (0.24) $ 0.60

Other operational data:
Utilization (a) 57.5 % 71.6 % 57.6 % 70.1 %
Average fleet age (months) 36 29 36 29
Same store rental revenue growth / (decline) (a) (32.4) % 4.4 % (27.1) % 5.3 %
Employees (a) 4,513 5,346 4,513 5,346
Original equipment fleet cost (in millions) (a) $ 2,455 $ 2,731 $ 2,455 $ 2,731

(a) Refer to attached Statistical Measures for descriptions.

Note: Certain amounts in the condensed consolidated statements of operations for the quarter ended June 30, 2008 have been reclassified to conform with the current year presentation. The Company believes the current presentation better reflects the nature of the underlying financial statement items. The reclassificiations have no effect on operating income, net income or net income per common share.

RSC HOLDINGS INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)

June 30, December 31,
2009 2008

Assets
Cash and cash equivalents $ 8,727 $ 13,670
Accounts receivable, net 209,298 285,000
Inventory 16,526 19,859
Rental equipment, net 1,553,346 1,766,978
Property and equipment, net 143,866 171,156
Goodwill and other intangibles, net 940,443 938,682
Deferred financing costs 47,748 46,877
Other assets 23,235 28,306
Total assets $ 2,943,189 $ 3,270,528

Liabilities and Stockholders` Equity
Accounts payable $ 49,047 $ 109,542
Accrued expenses and other liabilities 174,069 203,288
Debt 2,357,247 2,569,067
Deferred income taxes 332,273 345,511
Total liabilities 2,912,636 3,227,408
Total stockholders` equity 30,553 43,120
Total liabilities and stockholders` equity $ 2,943,189 $ 3,270,528

RSC HOLDINGS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

Six Months Ended
June 30,
2009 2008
Cash flows from operating activities:
Net (loss) income $ (24,994) $ 62,422
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization 170,299 182,073
Amortization of deferred financing costs 5,215 4,787
Share-based compensation expense 2,294 1,840
Gain on sales of rental and non-rental property and equipment, net of non-cash writeoffs (5,616) (16,284)
Deferred income taxes (16,759) 18,754
Changes in operating assets and liabilities (7,255) (89,487)
Net cash provided by operating activities 123,184 164,105
Cash flows from investing activities:
Purchases of rental equipment (18,337) (164,958)
Purchases of property and equipment (1,889) (10,023)
Proceeds from sales of rental equipment 92,373 56,686
Proceeds from sales of property and equipment 8,130 3,025
Insurance proceeds from rental equipment and property claims 3,086 -
Net cash provided by (used in) investing activities 83,363 (115,270)
Cash flows from financing activities:
Net payments on debt (212,669) (54,492)
Proceeds from stock option exercises 256 950
Other 685 (150)
Net cash used in financing activities (211,728) (53,692)
Effect of foreign exchange rates on cash 238 (116)
Net decrease in cash and cash equivalents (4,943) (4,973)
Cash and cash equivalents at beginning of period 13,670 10,039
Cash and cash equivalents at end of period $ 8,727 $ 5,066

Supplemental disclosure of cash flow information:
Cash paid for interest $ 84,088 $ 107,818
Cash paid for taxes, net 5,635 15,095

RSC HOLDINGS INC. AND SUBSIDIARIES
Rental Revenue Growth Bridge
(in thousands)

Rental Revenues

Three Months Ended Six Months Ended
June 30, June 30,

2008 $ 404,843 $ 777,178

Changes:
Volume -25.7% -22.4%
Acquisition 0.7% 0.7%
Price -7.7% -5.8%
Currency -0.5% -0.7%

2009 $ 270,500 $ 557,970

Annex A

EBITDA and Adjusted EBITDA. EBITDA, a supplemental non-GAAP financial measure,
is defined as consolidated net income before net interest expense, income taxes
and depreciation and amortization. Adjusted EBITDA as presented herein is a
non-GAAP financial measure and is generally consolidated net income before net
interest expense, income taxes, and depreciation and amortization and before
certain other items, including share-based compensation, management fees and
recapitalization expenses. All companies do not calculate EBITDA and Adjusted
EBITDA in the same manner, and RSC Holdings` presentation may not be comparable
to those presented by other companies.

The company presents EBITDA and Adjusted EBITDA in this release because it
believes these calculations are useful to investors in evaluating our ability to
service debt and as tools to evaluate our financial performance. However, EBITDA
and Adjusted EBITDA are not recognized measurements under GAAP, and when
analyzing the company`s performance, investors should use EBITDA and Adjusted
EBITDA in addition to, and not as an alternative to, net income or net cash
provided by operating activities as defined under GAAP.

Free cash flow. The company defines free cash flow as net cash provided by
operating activities less net capital expenditures. All companies do not
calculate free cash flow in the same manner, and RSC Holdings` presentation may
not be comparable to those presented by other companies. We believe free cash
flow provides useful additional information concerning cash flow available to
meet future debt service obligations and working capital needs. However, free
cash flow is a non-GAAP measure and should be used in addition to, and not as an
alternative to, data presented in accordance with GAAP.

The accompanying tables reconcile the GAAP financial measures that are most
directly comparable to these non-GAAP financial measures. No quantitative
reconciliations of the estimated ranges for Adjusted EBITDA and free cash flow
to their respective most comparable measure calculated and presented in
accordance with GAAP are included as the company is unable to quantify certain
amounts that would be required to be included in such GAAP measures.

RSC HOLDINGS INC. AND SUBSIDIARIES
Adjusted EBITDA GAAP Reconciliation
(in thousands)

Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
Net (loss) income $ (11,490 ) $ 40,077 $ (24,994 ) $ 62,422
Depreciation of rental equipment and depreciation and amortization of non-rental equipment and intangibles 83,254 91,665 170,299 182,073
Interest expense, net 40,035 48,742 80,245 104,103
(Benefit) provision for income taxes (5,027 ) 25,635 (12,700 ) 39,910
EBITDA $ 106,772 $ 206,119 $ 212,850 $ 388,508

Adjustments:
Share-based compensation 1,162 952 2,294 1,840
Other expense (income), net 107 (16 ) 410 (643 )
Adjusted EBITDA $ 108,041 $ 207,055 $ 215,554 $ 389,705
(Adjusted EBITDA as a percentage of total revenues) 33.1 % 46.1 % 31.8 % 44.7 %

Free Cash Flow GAAP Reconciliation
(in thousands)

Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
Net cash provided by operating activities $ 57,054 $ 153,557 $ 123,184 $ 164,105

Purchases of rental equipment (9,746 ) (85,539 ) (18,337 ) (164,958 )
Purchases of property and equipment (782 ) (4,215 ) (1,889 ) (10,023 )
Proceeds from sales of rental equipment 42,470 25,280 92,373 56,686
Proceeds from sales of property and equipment 4,671 1,508 8,130 3,025
Insurance proceeds from rental equipment and property claims 1,086 - 3,086 -
Net capital expenditures 37,699 (62,966 ) 83,363 (115,270 )

Free cash flow $ 94,753 $ 90,591 $ 206,547 $ 48,835

Statistical Measures

Utilization is defined as the average dollar value of equipment rented by
customers (based on original equipment cost) for the relevant period divided by
the aggregate dollar value of all equipment (based on original cost) for all
equipment.

Same store rental revenue growth is calculated as the year over year change in
rental revenue for locations that are open at the end of the period and have
been operating under the company`s direction for more than 12 months.

Employee count is given at the end of the period indicated and the data reflect
the actual head count as of each period.

Original Equipment Fleet Cost (OEC) is defined as the original dollar value of
equipment purchased from the original equipment manufacturer (OEM). Fleet
purchased from non-OEM sources is assigned a comparable OEC dollar value at the
time of purchase.

RSC Holdings Inc.
Investor/Analyst Contact:
VP - Investor Relations
Gerry Gould, 480-281-6928
Gerry.Gould@RSCRental.com
Media Contact:
Chenoa Taitt, 212-223-0682

Copyright Business Wire 2009

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