Matthew J. Flannery
President and Chief Executive Officer at United Rentals
'Thanks, operator, and good morning, everyone. Thanks for joining our call. The teams have made my job pretty easy today. We reported another strong quarter in a positive operating environment in a record year. That's a great trifecta. And I know it sounds familiar because that's how the year has been going. This quarter was especially gratifying. We delivered year-over-year increase in rental revenue of 20%, with fleet productivity of almost 9%. Our people were definitely on top of that opportunity. We achieved good operating leverage in our business by working efficiently. And that's not easy to maintain during peak demand, especially in the current cost environment. So I applaud the team for meeting our customers' needs while staying mindful of profitability, and most of all, for doing it safely.
Our recordable rate for both the third quarter and year-to-date were well below one, and that's with about 10% more headcount in the quarter versus last year. Against this backdrop, we grew our EBITDA margin by 240 basis points year-over-year up to 49.9% in the quarter as we grew EBITDA dollars faster than revenue to over $1.5 billion. And that's a record for us in any quarter. And flow through was a very solid 63%. Importantly, we also delivered another improvement in return on invested capital to a record 12.2%. Given these results and the momentum we're seeing, we raised our full year 2022 guidance for total revenue and adjusted EBITDA as well as rental capex.
I want to elaborate on the capex point before I move to our customers and our end markets. Our industry has continued to show good discipline in terms of supply and demand, which creates a healthy environment for attractive returns. We have two levers we can pull to capitalize on this demand. First, we intentionally held back on used equipment sales this year to make sure we had enough capacity for our customers. And even though we sold less fleet in the quarter on an OEC basis versus our original plan, our revenue from used sales in Q3 was essentially flat year-over-year, supported by very strong pricing.
And secondly, we have the opportunity to pull forward some capex into the current quarter to ensure that we're set up for a strong start to 2023. And our updated guidance includes an increase of rental capex of about $350 million at the midpoint, and we think this is prudent as our OEM partners continue to work through supply chain challenges. So that's how we're thinking about capex at United Rentals.
And on a related note, we're continuing to invest some of the capex in fleet that lowers carbon emissions on job sites in line with our ESG initiatives. We recently announced an agreement to purchase all-electric ride-on dumpsters from JCB, making us the first equipment rental provider to offer this product in our fleet. And on the innovation front, we just launched the sustainability tool in our Total Control platform that tracks greenhouse gas emissions data. This technology is an industry-first and it's a good example of how we differentiate our Company as a partner beyond the transaction. And in this case, we're helping customers reach their own sustainability goals. Investments like these continue to add value to our offering and keep us growing faster than the industry.
Now, I'll turn to the macro. While there are portions of the economy that are clearly slowing, in our industry, customer activity is still on the upswing, and demand for our equipment rental continues to be very strong. Customer sentiment and key industry indicators remain positive. And we know this outlook may seem at odds with some views on the broader economy, and if we saw a cause for concern in our markets, we'd be standing here talking about it. We'd also be using the flexibility built into our model to pivot to a more conservative stance. Instead, we're investing in the tangible opportunities that we see ahead.
Here are a few of the unique dynamics that should help our industry continue to outpace the macro in virtually any economic cycle. One is the $550 billion of funding in the US infrastructure bill, which will finally put shovels in the ground starting in 2023. This should trigger at least five years of opportunity. There's another $440 billion of federal tax incentives in the Inflation Reduction Act for clean energy and plant upgrades. We think these will have a five- to 10-year impact. And in the manufacturing sector, there are multiple tailwinds that will play out on different timelines. This year alone, hundreds of billions of dollars of new investment in manufacturing have been announced.
Investments are already underway in automotive electrification, microchip factories, and the broader trend towards onshoring. And there's also more focus on energy production to serve markets in North America and Europe. Many of these tailwinds are new to the construction and industrial sectors, and in combination, they're a major opportunity for our industry.
Looking specifically at our business, the quarter played out even better than we anticipated. Both of our segments in every one of our regions grew rental revenue year-over-year by double-digits. Rental revenue from non-res construction was up 24%, infrastructure was up 11%, and industrial was up 13%, and these are all consistent with the trends we've seen in recent quarters.
Demand for specialty was strong across the segment with rental revenue up 23% year-over-year as a whole, led by our Mobile Storage and Fluid Solutions businesses. Our greenfield plants for Specialty are moving forward with 25 cold starts open through September and another 11 planned by year-end. Cold starts continue to be a valuable growth strategy for Specialty with a long-term benefit to our Company's total performance.
Looking at our markets by vertical, the big multi-year projects in Q3 continue to be data centers, distribution centers, and renewables, as well as the automotive and chip plants that I mentioned earlier. And these projects span multiple regions and most of them are mega projects where our customer base, our technology, and our position as a one-stop shop give us a major competitive advantage.
Contractors are managing to source through labor and the materials they need, but at the same time, they're dealing with cost inflation, so they need to squeeze more productivity out of every dollar. And we have the digital solutions to help our customers get more utilization from the equipment they rent and own. Worksites are evolving into connected environments, and we're positioned as a leader in that space. And our customers assigned real value to the data that we provide. And lastly, I want to mention the new share repurchase authorization we announced yesterday. This program will return $1.25 billion of excess capital to our investors by the end of 2023, and we're proud to make this additional commitment to supporting shareholder value.
So in conclusion, our 25th year in business is also shaping up to be a record year of financial performance. We've got a great team in place. And we'll continue to explore every avenue for growth and returns. The construction and industrial sectors we serve have their own tailwinds, driving the historic demand for our services. Our customers are building a strong book of business for 2023, and the secular shift toward renting is expanding the market. In this environment, we'll continue to be good stewards of United Rentals, we'll focus on profitable growth as we have all year and we'll remain flexible to act in the best interest of our shareholders.
And with that, Ted, it's over to you.