Welcome to the Fourth Quarter 2024 WillScot Earnings Conference Call. My name is Sherry, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note that this conference is being recorded. I would now turn the call over to Charlie Wohlhuter. You may begin, Charlie.

Great. Thank you, Sherrie. Good afternoon, everyone, and welcome to WillScot fourth quarter 2024 earnings call. Participants on today's call include Brad Soultz, Chief Executive Officer; Tim Boswell, President and Chief Operating Officer; and Matt Jacobsen, Chief Financial Officer. Today's presentation material may be found on the Investor Relations section of the WillScot website. I'd like to direct your attention to slide 2 containing our safe harbor statements. We will be making forward-looking statements during the presentation and our Q&A session. Our business and operations are subject to a variety of risks and uncertainties, many of which are beyond our control. As a result, our actual results may differ materially from today's comments. For a more complete description of the factors that could cause actual results to differ and other possible risks, please refer to the safe harbor statements in our presentation and our filings with the SEC. With that, I'll turn the call over to Brad Soultz.

Thanks, Charlie. Good afternoon, everyone. And thank you for joining us today. 2024 was a pivotal year for WillScot, marked by strategic changes that modernized our business and positioned us for continued scalable growth as North America's largest provider of turnkey space solutions. Despite the end market challenges we face, the durability of our business remains strong and our team delivered solid financial results. On slide 10, many of our strategic priorities over 2024 focused on our platform to position us for the next stage of growth. Earlier in the year, we merged the Mobile Mini and WillScot field sales and operations teams for better streamlined execution. We then finalized our major systems integration and consolidated our field service and dispatch platforms and teams. In Q3, we unified our brand under WillScot and introduced enhanced digital marketing tools for customer service and sales. Along the way, we've continued to scale the team, adding requisite expertise and experience. Tim will talk more about priorities for 2025, though we see important opportunities to further improve performance across sales, field operations, and our back office, and our team is fully aligned accordingly. As you can tell, we've been busy with a laser focus on refining our already strong operational foundation that is the backbone of our growth plans, all of which will be on full display at our upcoming Investor Day on March 7th. Turning back to slide 4, a hallmark of our business is our strong capital generation profile and the wide range of opportunities this affords us to drive shareholder value. We use this first to serve customer needs with best-in-class and differentiated solutions. We then evaluate our existing portfolio for adjacent offerings that complement our core and will allow us to further expand our solution set. We have a balanced…

Thank you, Brad. Good afternoon, good evening, everybody. As Brad noted, 2024 was a year of foundation building, executing initiatives across our sales and field teams to support them with strong go-to-market capabilities to better serve our customers. One of our most significant accomplishments this year was completing the final systems and field integration of our sales and operations teams. We now have a single general manager and a sales team accountable for every geographic market in North America. And this was a big change for the team in 2024. This integration allows us to go to market more efficiently as one unified team, ensuring we can effectively communicate our full suite of product offerings to every customer at every opportunity. Our teams have embraced this transition. Customers love the local single point of contact. It unlocks clear career development and growth opportunities for our team. And it gives us a single chain of command to drive accountability for performance. In turn, we're seeing our sales team stabilizing in their roles, as well as improvements in customer satisfaction. So as an organization, we're on much stronger footing heading into 2025 and focused on improving execution in four main areas. The first is our core commercial execution, or said simply, selling. The changes we implemented in 2024 were disruptive, but they are behind us now. While executing the reorganization, we also made a very strong push in the area of sales enablement, creating levers to improve productivity. We've introduced new digital marketing capabilities to fill the funnel with more and higher quality leads. We've improved our CRM sales dashboard to recommend better selling actions to our sales reps. We've upgraded our pricing technology to improve both conversion and rate attainment with better segmentation. And we're implementing a new quote configuration tool…

I'll begin on slide 22 with an overview of the year and the quarter. 2024 was a challenging year in our end markets, but we still delivered modest full year revenue and adjusted EBITDA growth to record levels of $2.4 billion and $1.063 billion respectively, in line with what we communicated on our Q3 earnings. Our ability to sustain solid financial results despite contraction in key end markets underscores the resilience of our business model. Looking at the fourth quarter, total revenue of $603 million declined by about 2% year-over-year, with leasing revenue down about 3%. As Tim explained, volumes were weaker. However, our strategies around pricing and value-added products continue to help offset the impact as average monthly rental rates were up 6% year-over-year for modular and up 5% year-over-year for storage. We're seeing steady demand for value-added products, resulting in greater penetration and a very small contribution now from perimeter solutions, which we intend to grow over time. Further, our ability to flex other operating costs, including realization of savings from the actions we took at the end of Q2, also helped to ease the volume declines and drove 30 basis points of year-over-year margin expansion to 47.3% in the fourth quarter and adjusted EBITDA of $285 million. I would note this is the second consecutive quarter we drove year-over-year margin expansion in 2024. Moving to slide 23, cash provided by operating activities remained strong. We generated adjusted free cash flow of $137 million in the fourth quarter at a 23% margin, which was consistent with our profile for the full year in 2024. Adjusted free cash flow for 2024 was $554 million. As you can see, our cash flow generation is robust and sustainable. and affords us multiple options for deployment. On slide 25, our capital allocation…

Thank you, Matt. And congratulations to you in your new role as our CFO. With respect to our outlook, I would just add that programmatic tuck-in acquisitions remain a high priority for capital allocation. While largely not considered in our 2025 guidance, our current pipeline of potential acquisitions could support a continuation at the pace we achieved over the last three years. I would like to also extend a heartfelt thank you to our team, customers, and shareholders. In 2024, we focused on aligning and scaling our people, systems, and products to drive deeper engagement with our customers. With this foundational work largely complete, we're prioritizing all aspects of excellence, which provide new levers to support our growth. Thank you for joining us today, and we look forward to sharing more details with you at our Investor Day in two weeks. This concludes our prepared remarks. Operator, please open the line for questions.

[Operator Instructions]. Our first question will come from the line of Angel Castillo with Morgan Stanley.

I wanted to go back to maybe the comments or the dynamics around net CapEx, which is a little bit higher year-over-year. I see kind of the outline in the slides as to what you're kind of investing in. But I was wondering if you could talk about this more longer term as we think about more kind of normalized business and in the absence of perhaps inorganic growth, what do you kind of see as the normal level of CapEx required to continue to drive your business in terms of percentage of sales and if you could think about that in terms of kind of maintenance and growth CapEx separately. That would be helpful.

This is Matt. I'll address that. As we look at maintenance capital, based on the business right now, I think $200 million is a good general number to look at. We are investing in some other product areas. We have been this last year in 2024 as we are expanding cold. We're now for 2025 investing incrementally in cold, but also a bit more into clearspan and some of these other product development areas that Tim mentioned. Perimeter solutions will be one of those. A little bit of solar some of these other products, but I think $200 million is kind of that right range. And these other product categories for 2025 are really taken to that midpoint of a guide based on kind of a neutral, in kind of a neutral volume environment going forward. Obviously, at different ends of the range, depending on your volume assumptions, that'll ramp up or down.

I was hoping you could give us an update also on kind of the spread between your spot and your AMR for modular. I think just kind of where it's kind of exiting the year and how you see that kind of shaping up throughout 2025.

I think, for Q4, on modular, really no change from the third quarter. I think we were 12% last quarter, it's right at 11% right now. So no real change on modular. So as we look forward, we expect to continue to push a little bit on rate each quarter through our normal process, but no real change there.

One moment for our next question. And that will come from the line of Scott Schneeberger with Oppenheimer.

I'd like to just kind of speak a little bit to the 2024 to 2025 EBITDA bridge. I know there were some cost savings from past summer that carry through to next year on half contribution, which is probably a sizable component. And then we've heard a lot, you guys speak, about a lot of the investment. And then, of course, the macro is probably going to be a deciding factor. But could you just fill in the blanks there and maybe prioritize what are the swing factors? What are the main drivers on the year-over-year bridge to get you to the low end and the high end of your guide for 2025 EBITDA?

I'll probably talk to the midpoint first. That's probably a little bit more straightforward. As we look at where we're exiting the year, obviously, volume is down 5% in modular and 17% in storage. So we're starting with that headwind. On the modular side, rate and VAPS are offsetting most of that here in the first quarter. On storage, we're not making up the full 17%. So storage, as we go work our way through the year, we're starting with a headwind and we expect that to moderate a bit. So that's kind of more of the top line piece. Again, starting kind of flattish in modular, growing through the year, starting down in storage and working that back. On the cost side, maybe I'll talk sequentially from the fourth quarter, we did see in the second half of the year the benefits of the Q2 cost takeouts that we did. And as we look into 2025, we do have some variable compensation costs will come into 2025 as we have better performance from where we originally expected. We are making an investment here in the first quarter for a manual kind of company meeting that will drag that a little bit in the first quarter. And then as we talked about, we're starting to add additional sales resources to help drive organic growth in the business. So I think those are some of the bigger components. As you kind of look forward from current SG&A and what that looks like. At the end of the year, basically from a margin perspective, it's relatively in line, especially in the second half with a little bit of headwind, maybe here in the first half as I talked about.

For my follow up, I'd like to just dig in on VAPS a little bit. Looking at the LTM delivered rate over the past four quarters, for both modular and for storage, it's been pretty much stalled. What should we expect over 2025 for VAPS? I know you have some initiatives there. Are we going to be able to see that LTM delivered rate start to get moving towards your target goal rates and what would be the drivers of that?

This is Tim. I'll start and the other guys here can supplement. The biggest change that we're making heading into 2025 is likely to be in terms of our quoting process and introducing new guided selling and bundling features there to try to eliminate some of the variability in terms of sales rep performance. When we look across variability by individual or by branch, you see a lot of inconsistency still in terms of quote penetration for value-added products. But when we quote it, we close it between 70% to 80% conversion rate. So the continued performance management of our own sales team is probably the number one factor impacting that delivered rate. Another thing that's going on under the hood that's working against us is actually the mix of modular that's going out. Single wide mobile offices have our highest VAPS penetration on a per unit basis and they're probably the weakest from a volume standpoint and complexes and flex units have lower penetration. I won't get into all the details but flexes are fastest growing fleet type on a per unit basis. So that mix shift under the hood is a headwind to the delivered rate. So just stabilizing the single wide mix actually would help drive some improvement in that area. The LTM on storage, this is a newer effort, right? In Q4, for example, this year we had, shoot, I think it was about 15,000 seasonal activations this year with very low VAPS penetration, so that's going to be a headwind to that number. And if we look at where VAPS penetration rates are to start the year, you're pushing 40 bucks across our core storage volume. So, I feel pretty good about what we're seeing under the hood in VAPS for storage containers.

One moment for our next question. And that will come from the line of Tim Mulrooney with William Blair.

With respect to activations, can you talk about what's embedded in your guidance for 2025? Does it assume a more normalized seasonal pattern? Like, where we see dodge starts down sequentially a little bit in the first quarter, but up strong sequentially in the second quarter. I think last year you said square footage starts are historically up 26% sequentially in the second quarter. Is that what you're assuming here or are you hair cutting that in the guide?

I think, generally, we're assuming a more normal seasonality, Tim. This is Matt speaking. I think it's more normal than we would have seen last year. Last year did feel a little abnormal. But we'll see how that kind of plays out here a bit more over the next couple months and how Q2 kicks up.

Activations starts are down but consistent with what we forecasted to start the year. Right? So we did embed some of this in the guidance ranges that we put together. And we are seeing strong sequential increases in net order rates going from December into February now that in the case of containers are showing year-over-year growth, and in the case of modulars continue to be aligned with our with our forecast. I agree with Matt's assessment. I think the sequential cadence is pretty consistent with what we would expect in a normal year.

One more for me. It looks like you reduced the share count by about 3% in 2024, which is below what we've seen over the last few years with no buybacks in December or year-to-date. Was there any reason for no buybacks more recently and would you expect buybacks to pick up relative to what you did in 2024?

I think on the buybacks, we'll give a bit more kind of flavor on capital allocation here at the Investor Day. There's usually an update. But there's been no change to our capital allocation policy there and kind of our approach. So we'll continue to look at all options to return value to shareholders and manage leverage, et cetera.

Yeah, this is Brad. I'll just add. It remains a powerful lever for return value to shareholders. For reasons we've discussed on earlier calls, we were out of the market a bit last year. So I think this is no major change in our capital allocation framework. We'll continue to prioritize organic M&A. to the extent it's there and the pipeline looks good. And that still leaves about half the capital of return to shareholders. The new dividend's about 10% of our free cash flows. So it's not a either or here, it's just another avenue.

One moment for our next question. And that will come from the line of Sherif El-Sabbahy with Bank of America.

I just wanted to ask, checking in on free cash flow, for 2025, is that something where you expect to see free cash flow margin expand on a year-over-year basis, or is that margin going to remain consistent year-over-year?

I think the two kind of changes as we look year-over-year are really the two items I hit my prepared comments. At the midpoint of our guide, we do have an increase of about $30 million on our net CapEx. And then as we move from 2024 to 2025, we will be a partial taxpayer in 2025. We do expect cash taxes in 2025 to be about $30 million higher than they were in 2024. So I think those are really the two changes. That will result in a slight reduction in the free cash flow margin versus what we saw in 2025, but still well within the range that we've put out there.

One moment for our next question. And that will come from the line of Steven Ramsey with Thompson Research Group.

Wanted to think about the flex product with storage and the outlook, if I heard correctly, the outlook for increased retail remodels in 2025. Do you expect that customer set to take up this product? And if so, would that boost the delivered rate through 2025 and 2026 should that demand come through?

Two different questions there. So the first is related to remodeling activity among some of the larger big box retailers that we serve. And we have expected that deferred activity to pick up in 2025 was always the year that we had circled, albeit in pencil, but we are seeing between 3,000 to 5,000 remodel related container orders coming through the system and those will play out through the course of the year. So it's nice to see that activity coming back and coming back to us. Your second question around flex units relates to the modular side of the portfolio. So these are our panelized stackable office units that are becoming – now over 8% of the unit on rent portfolio is in flex units. And those units on rent are up, I think, about 30% year-over-year. And my comments there as it relates to the impact of that mix shift on the AMR that we report, those are just smaller 8 foot by 20 foot units. So they tend to dilute a little bit the per unit modular pricing and VAPS. But they're higher return on capital and higher price per square foot and more versatile and simply a better mousetrap for our customers. That really is the only modular fleet category where we're adding stock fleet. And I expect that mix will continue to shift gradually in the favor of flex over the course of the next five years.

I wanted to think about delivery and installation revenue, then declining for six straight quarters, but the easing comps and non-res starts in square footage, at least in Q4, looking better. What I'm getting at, do you expect D&I revenue to start showing year-over-year growth at some point in 2025?

I'll address that one. I think there's a few things there, and some of them are definitely positive items with returns actually reducing. So when we either deliver a unit or return a unit, there's D&I revenue associated with that. And so, as you look at some of the year-over-year comps the last couple of quarters, part of the reason for the reductions in D&I revenue has been fewer returns, which is a good thing from a recurring leasing revenue standpoint. I do think we still do expect returns to be down in 2025 versus 2024. So that will continue to be a little bit of a headwind, especially in the first probably half of the year, as we're looking at our D&I revenues, but overall positive for recurring lease revenue.

One moment for our next question. And that will come from the line of Manav Patnaik with Barclays.

This is Ronan Kennedy on for Manav. If I'm not mistaken, I think you would reference customers being more optimistic with greater political certainty, but also reference caution on higher for longer interest rates and potential tariffs implications. So can we unpack both aspects of that statement with regards to customer optimism to see what they're saying in your conversations with them, but also regarding potential political fiscal policy, tariffs, immigration and deportation on the business and outlook and what's contemplated for the guide.

There's a lot there, some of which is related, some of which is not. But I'll start with what we're hearing from customers and seeing in the market. Obviously, the third-party data points as it relates to core construction activity continue to be mixed. You've got an ABI that dropped down to 45 in the last reading. So it's been a bit bipolar in recent months since the election, much like the electorate. So that's one data point that's out there. You also have contractor backlogs that ticked up slightly sequentially since the end of December. And if you look under the hood there, backlogs are increasing more among the larger contractors, which is perfectly consistent with what we see in the mix of our customer portfolio and our product portfolio. As you look across like the other end markets in our business that are performing well versus those that are not, education was the largest revenue grower for us in 2024. And I think we've got a great vertical sector penetration opportunity there that we're targeting, both with traditional classrooms and a flex product. Utilities, probably not surprisingly, we're seeing interesting activity there, year-over-year revenue growth, and expect that would continue based on the requirements for our grid infrastructure in the country. So probably consistent with what you would expect just reading the newspaper headlines. As it relates to government activity and tariffs and immigration, construction employment still remains really, really high in the country. And if immigration enforcement becomes a headwind to construction employment, I could see that causing delays in both project starts and completions, which we've seen before in terms of other supply chain constraints. You could make a similar hypothesis around the effect of tariffs on building supplies and things of that nature. That said, there could be potential demand-related opportunities related to immigration support. We've done that in the past in terms of border wall construction, et cetera. And as it relates to tariff activity, it's hard to predict the long-term impact of those. If it results in a reshoring of activity and more domestic investment, that's obviously good for us. It could tighten the container market in time if it reduces supply coming from China. So that could be a benefit on the container side of the business. But it's really too soon to say how all of those things play out. I think you definitely left the election cycle with more optimism around the US business cycle at the end of the year, but I'd say there's also a fair amount of uncertainty out there right now related to all these different policy decisions that are made and to be made.

I think you had referenced or it was referenced on the call the demand from mega projects is consistent or stable. Can I just confirm that and see if you could contextualize kind of the volume contributions from mega in 2024 and what the expectation is for 2025?

I really can't quantify it that way, other than to say it still remains a very prominent theme when we look at demand activity across our portfolio and it's pervasive across geographies. Honestly, even up into Canada, in some cases. So we don't see any change in the cadence of those projects. We're disproportionately positioned to win those projects. And as you think about the relative performance of the products within our portfolio, complex business, flex units remain rock solid. We're weaker in the transactional product lines like single wide mobile offices and ground level offices and containers. And that's been consistent now for at least a year.

One moment for our next question. And that will come from the line of Andrew Wittman with Baird.

I wanted to ask a question that's been kind of touched on, but maybe ask it a little bit more directly. In your guidance or in your outlook, when do you expect modular units on rent to inflect into positive territory? What's assumed at the midpoint and does the low end of your guidance assume that they'll remain negative for the year? I just want to kind of understand when there might be an inflection on UOR for modular.

I think the short answer is, obviously, we don't we don't know exactly what the end markets are going to provide for this year. At the midpoint of our guide, we're basically assuming that the headwinds are going to subside as we move through the year. And that could mean that you're crossing, maybe later in the year, but we just don't know yet is really the truth. So at the high end of the range, you're probably moving that forward. And if activity takes up, you could get there sooner. At the low end of the range, maybe it doesn't happen at all. We don't know. So the guidance kind of reflects the bands around those different outcomes.

I think I know the answer to this one, but for a while your storage business AMR was benefiting from a mix change with the cold in there. I think as of the fourth quarter, the large effect from the mix is now out. Is that right? Is that, I guess, 5% AMR year-over-year basically kind of a like-for-like now?

Yeah, more or less. I think as we go forward, cold will continue to increase in the overall mix of our storage products. So there still is that slight benefit in the year, but you are like-for-like, as in that we had cold storage at the end of 2023. So as we look at that 5% that's up year-over-year, that mix shift is accounting for most of that, but our container AMRs are steady.

One moment for our next question. And that will come from the line of Brent Thielman with D.A. Davidson.

I guess quick question. Just the modular exit rate in terms of units on rent and utilization, I guess, was a little more surprising to us as opposed to storage. And I think I'm just trying to understand what might be an anomaly in there, what might possibly be due to mix with the shift to flex, which is simply the state of the union and the market right now, especially as we're thinking about this into 2025, it would be helpful.

I think the only real change there from our perspective was just the activation levels between the end of Q3 and the end of Q4. And that in and of itself has resulted in kind of the lower unit on rent starting point. What really matters for us going forward is what's that activity level that we see today and at least, quarter-to-date, we're seeing modular activity levels that are in line with what we forecast, albeit slightly down year-over-year. So, so far, what we're seeing is consistent with the plan that Matt laid out.

I guess just given we've seen the expansion in rate within storage moderate here into year end, I'm just trying to understand as you look to the guidance for 2025, I want to get a handle just what's factored in for rate and storage as opposed to where you're clearly seeing good penetration in VAPS and core rate growth, for that matter.

As we look at storage, we're seeing some of those same things in storage. Tim mentioned on VAPS for storage, that will continue to contribute to the AMR. I think I would say our assumptions on the pace of growth in the core rate on containers, our assumptions there are much subdued from what they would have been two or three years ago. But we've seen steady rates since Q2 of last year and a small increase in that as we've gone over time. So I think a modest increase is kind of what our base case would say with a little bit more coming from VAPS.

One moment for our next question. And that will come from the line of Phil Ng with Jefferies.

I guess you guys kind of pointed out 2024 was a busy year in terms of integrating the sales force. So execution's been a little more mixed. You talked about how you have these new tools for the sales force. Sounds like you're looking to cross sell and go after some of these enterprise accounts. Are you kind of realigning KPIs for the sales force to kind of stimulate these actions? Tim, in your new COO role, what are some of the new focus that you'll be really hammering to kind of drive performance there?

The first one is commercial execution, right? And absolutely, we're realigning both performance expectations and incentives to an extent across the sales roles and also taking a hard look at our sales management layer, right? And there's going to be accountability at all levels. We've got better tools from a productivity standpoint and also from a performance visibility standpoint than we've ever had and we intend to use them. In terms of how we're approaching the year from an overall sales organization standpoint, I do believe there's the opportunity for productivity improvements that probably get you some upside within the range that we're talking about. As Matt talked about, because we've got the reorganization done and the system platform in place, I do think there's the potential to add maybe on the low end 5% to the sales organization and upwards into the high teams through the course of the year if markets are supportive. So this is a key area where I think top to bottom in the organization we know we can execute better. And that's both within the core and across some of the new product lines that we've introduced, which is also a focus. Then I talked about field operations and shared services. Within shared services, order to cash process and some of these back office processes have been a customer experience and customer satisfaction detractor for some time. We know it. We see it in the survey data. And because some of this foundational work is done, we've elevated that as an enterprise level priority. And I think there's a satisfaction and retention opportunity there. There's a working capital opportunity there. There's a P&L benefit there. Then I talked about human capital and performance management. So those are three broad categories that I'm quite focused on in the first half of the year.

For you, Matt, your guidance for 2025, can you give us a little more color on what's baked in terms of AMR growth, whether it's modular storage? I think at least last quarter, you guys were talking about potentially mid-single-digit AMR growth in 2025 for modular, maybe low-single-digit in storage. Are those still within scope, or are you thinking about it a little differently given the demand background?

I think at the midpoint, Phil, that's right. I think you could go a little bit higher in that to get to the – when you start going to the higher end of the range, some of that accelerates a little bit quicker. And, obviously, to the lower end of the range, if it didn't go quite that way. But that would be our base case. I think it's still pretty consistent with what we would have thought a year ago. We haven't really had any surprises from a rate perspective here since we spoke last quarter.

Rate, in terms of the delivery units for storage, it's been pretty steady to up. Is that what you commented earlier? I just want to make sure on the storage side, demand's been much weaker there.

My comments were kind of on the AMR. I was talking about AMR, Phil, as we progress kind of from Q3 to now and how that's changed. It's been pretty consistent with what we said. And then on the storage side, I mentioned it a little bit earlier, if I heard your question right, the delivered rates on storage have been stable since Q2 of last year and increasing modestly. And then the VAPS are kind of helping to increase that a little bit more.

One moment for our next question. And that will come from the line of Faiza Alwy with Deutsche Bank.

Tim, you mentioned the enterprise accounts and I know you said we haven't really talked about this too much. Curious, can you give us a bit more color, maybe what's the sizing of these accounts relative to the overall portfolio? And just help us appreciate the opportunity there a little bit more.

We'll talk about this in two weeks' time in more detail. But our largest customer here is no more than 1.5% of revenue. And this is the blessing and the curse of the portfolio, right? Because it's such a fragmented and diversified portfolio, it doesn't really move very quickly one way or the other, which is why it's so resilient and stable. Our top 200 customers generate about $500 million of revenue, just to give you a ballpark sense, about 20% of the total. Heavily weighted towards all of the largest general contractors in North America as well as many of the largest retailers. But we do have blue chip names across every major industry vertical that you would find in the US economy. What we haven't had historically is a vertically aligned business development layer that's selling across our footprint. The vast majority of our selling resources, of which we have about 550 in the company, are geographically aligned, selling within a territory defined by local zip codes. So when you've got customers that are working across all geographies, first of all, we're almost the only game in town. And second of all, we've got a unique value proposition that we can take to those customers. I think we've got a wallet share opportunity in those enterprise accounts that we already have. And we absolutely have an opportunity to add to that portfolio. That's what I'm talking about, and that's one of the initiatives that we're resourcing around this year.

Matt, question for you. You mentioned the quarterly cadence a little bit and that the first quarter EBITDA margins will be modestly lower. Just to avoid confusion, I'm wondering if you could be a little bit more specific around the range for the first quarter EBITDA margins?

I think somewhere our midpoint of our guide is probably somewhere in 100 basis points or so, as we have a little bit of those headwinds coming here into the first quarter and as we're adding some of the sales headcount that we're talking about. So that's about the range. Obviously, that could be a little better, but that's where we've set it.

Thank you/ I'm showing no further questions in the queue at this time. I would now like to turn the call back over to Charlie Wohlhuter for any closing remarks.

Thank you, Sherrie. Thank you all for your interest in WillScot today. If you have any additional questions after today's call, please contact me. Thank you and have a great day.

This concludes today's program. Thank you all for participating. You may now disconnect.