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Essex Rental Corp. Reports 2015 Second Quarter Results

The following excerpt is from the company's SEC filing.

Second quarter adjusted EBITDA before non-cash compensation and non-recurring expenses increased

sequentially by 31.9% to $4.5 million

BUFFALO GROVE, IL

Essex Rental Corp. (Nasdaq: ESSX) ("Essex" or the “Company”)

today announced its consolidated results for the second quarter ended June 30, 2015.

Second Quarter 2015 Highlights

Hydraulic crawler crane utilization increased to 75.2% for the three month period ended June 30, 2015 compared to 65.0% for the three month period ended June 30, 2014;

City and other tower crane utilization inc reased to 60.8% for the three month period ended June 30, 2015 compared to 46.0% for the three month period ended June 30, 2014. Rental revenue generated from tower cranes in the quarter was at its highest level since we acquired these assets;

Coast Crane rental segment gross profit increased by approximately $500,000 or 17.8% for the three month period ended June 30, 2015 compared to the three month period ended June 30, 2014;

Parts and service gross profit increased by approximately $800,000 or 58.4% for the three month period ended June 30, 2015 compared to the three month period ended June 30, 2014;

Gross profit increased by $600,000 to $5.9 million for the three month period ended June 30, 2015 compared to $5.3 million for the three month period ended June 30, 2014; and

Adjusted EBITDA increased sequentially by approximately $1.1 million or 31.9% for the three month period ended June 30, 2015 compared to the three month period ended March 31, 2015.

Nick Matthews, President and CEO of Essex stated, “Demand for our hydraulic crawler cranes, tower cranes and heavy rough terrain cranes continued to show improvement both sequentially and year over year in the second quarter of 2015. The increased rental revenue generated from these assets, which make up the majority of the orderly liquidation value of our rental fleet, helped to offset the decrease in rental revenue generated from the large hydraulic attachments that were on rent last year.”

“We continue discussions with the lenders of the Essex Crane Revolving Credit Facility to remedy the previously disclosed events of default. We believe the best value to our shareholders and our lenders is to restructure the Essex Crane subsidiary to unlock the value of its operating model. The Company and the Board of Directors are in the process of engaging a financial advisor to assist the Company in connection with its current financial and operational performance and strategic planning.”

Mr. Matthews continued, “The assets that make up a significant portion of the value of our rental fleet remain active. However, we are cognizant of the concerns in the market related to oil prices that remain depressed. With the broad array of end markets that our assets serve, we have been able to continue to drive high levels of utilization in most of our key assets. While we have been encouraged by the current activity and look forward to the benefits of our recently implemented cost savings initiatives, we continue to see softness in our retail sales and our traditional crawler crane utilization levels, and we remain cautious on our outlook for the remainder of the year.”

Second Quarter 2015 Overview

Essex Crane equipment rentals segment revenues were $8.2 million for the three month period ended June 30, 2015 versus $8.8 million for the three month period ended June 30, 2014. Essex Crane equipment rentals segment revenues include equipment rentals, transportation and used rental equipment sales revenue generated from the Essex Crane subsidiary. The $600,000 decrease was driven by a $600,000 decrease in equipment rental revenue and a $400,000 decrease in transportation revenue, partially offset by a $400,000 increase in used rental equipment sales. The decrease in equipment rental revenue was primarily driven by a decrease in large hydraulic attachment rental revenue.

Coast Crane equipment rentals segment revenues were $7.5 million for the three month period ended June 30, 2015 versus $7.6 million for the three month period ended June 30, 2014. Coast Crane equipment rentals segment revenues include equipment

Exhibit 99.1

rentals, transportation and used rental equipment sales revenue generated from the Coast Crane subsidiary. The $100,000 decrease was driven by a $300,000 decrease in used rental equipment sales, partially offset by a $200,000 increase in equipment rental revenue. Despite the decrease in overall revenue, gross profit increased by $500,000 or 17.8% due primarily to stronger margins from equipment rentals and used rental equipment sales.

Equipment distribution segment revenues, which includes the retail distribution of new and used equipment, but excludes the proceeds received from the sale of used rental equipment, were $3.3 million for the three month period ended June 30, 2015 compared to $2.9 million for the three month period ended June 30, 2014.

Parts and service segment revenues increased to $6.3 million for the three month period ended June 30, 2015 compared to $5.2 million for the three month period ended June 30, 2014. Parts and service segment revenues include...


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