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Associated Press
7 days ago
- Business
- Associated Press
Herc Holdings Completes Acquisition of H&E Equipment Services
BONITA SPRINGS, Fla.--(BUSINESS WIRE)--Jun 2, 2025-- Herc Holdings Inc. (NYSE: HRI) ('Herc' or 'the Company'), one of North America's leading equipment rental suppliers, today announced that it has completed its acquisition of H&E Equipment Services, Inc. d/b/a H&E Rentals ('H&E'). 'The acquisition of H&E accelerates Herc's proven strategy and strengthens our position as a premier rental company in North America,' said Larry Silber, Herc Rentals' president and chief executive officer. 'The addition of H&E's network and capabilities provides Herc with a leading presence in 11 of the top 20 rental regions, a larger fleet that provides our customers with a range of specialty and general rental products, and a talented team who shares our focus on excellence in customer service and safety. We are excited to realize the substantial upside ahead for industry leading growth and superior value creation.' Under the terms of the merger agreement, Herc Rentals acquired all of the issued and outstanding shares of H&E's common stock for, on a per share basis, $78.75 in cash and 0.1287 shares of Herc Rentals common stock. With the completion of the transaction, shares of H&E common stock have ceased trading and will no longer be listed on the NASDAQ. Herc Rentals Advisors Guggenheim Securities, LLC served as lead financial advisor. Credit Agricole Securities (USA) Inc served as co-financial advisor, and Credit Agricole Corporate and Investment Bank served as lead financing bank. Simpson Thacher & Bartlett LLP served as legal advisor. Joele Frank, Wilkinson Brimmer Katcher served as strategic communications advisor. About Herc Holdings Inc. Founded in 1965, Herc Holdings Inc., which operates through its Herc Rentals Inc. subsidiary, is a full-line rental supplier. With the recent acquisition of H&E Equipment Services, we have 613 locations across North America and pro forma 2024 total revenues were $5.1 billion. We offer products and services aimed at helping customers work more efficiently, effectively, and safely. Our classic fleet includes aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction, and lighting equipment. Our ProSolutions® offering includes industry-specific, solutions-based services in tandem with power generation, climate control, remediation and restoration, pumps, and trench shoring equipment as well as our ProContractor professional grade tools. We employ approximately 10,500 employees, who equip our customers and communities to build a brighter future. Learn more at and follow us on Instagram, Facebook and LinkedIn. Cautionary Note Regarding Forward Looking Statements This communication includes 'forward-looking statements' within the meaning of Section 21E of the Securities Exchange Act, as amended. Forward-looking statements include statements related to the Company, H&E and the acquisition of H&E by the Company that involve substantial risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied by such statements. Forward-looking statements in this communication include, among other things, statements about the potential benefits of the transaction, the Company's plans, objectives, expectations and intentions, the financial condition, results of operations and business of each of the Company and H&E, and expected valuation and re-rating opportunities for the combined company. Forward-looking statements are generally identified by the words 'estimates,' 'expects,' 'anticipates,' 'projects,' 'plans,' 'intends,' 'believes,' 'forecasts,' 'looks,' and future or conditional verbs, such as 'will,' 'should,' 'could' or 'may,' as well as variations of such words or similar expressions. All forward-looking statements are based upon our current expectations and various assumptions and apply only as of the date of this communication. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that our expectations, beliefs and projections will be achieved or that the completion and anticipated benefits of the transaction can be guaranteed, and actual results may differ materially from those projected. You should not place undue reliance on forward-looking statements. There are a number of risks, uncertainties and other important factors that could cause our actual results to differ materially from those suggested by our forward-looking statements, including, but not limited to, (i) the Company's ability to implement its plans, forecasts and other expectations with respect to H&E's business after the completion of the transaction and realized expected synergies; (ii) the ability to realize the anticipated benefits of the transaction, including the possibility that the expected benefits from the transaction will not be realized or will not be realized within the expected time period; (iii) problems may arise in successfully integrating the businesses of the Company and H&E, including, without limitation, problems associated with the potential loss of any key employees, customers, suppliers and other counterparties of H&E (iv) the transaction may involve unexpected costs, including, without limitation, the exposure to any unrecorded liabilities or unidentified issues during the due diligence investigation of H&E or that are not covered by insurance, as well as potential unfavorable accounting treatment and unexpected increases in taxes; (v) the Company's business may suffer as a result of uncertainty surrounding the transaction, including any adverse effects on our ability to maintain relationships with customers, employees and suppliers; (vi) any negative effects of the announcement of the transaction or the financing thereof on the market price of the Company common stock or other securities; (vii) the industry may be subject to future risks including those set forth in the 'Risk Factors' section in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and in the other filings with the SEC by each of the Company and H&E and (viii) the Company may not achieve its valuation or re-rating opportunities. The foregoing list of factors is not exhaustive. Investors should carefully consider the foregoing factors and the other risks and uncertainties that affect the businesses of the Company and H&E, including those described in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and in the other filings with the SEC by each of the Company and H&E. All forward-looking statements are expressly qualified in their entirety by such cautionary statements. We undertake no obligation to update or revise forward-looking statements that have been made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. View source version on CONTACT: Leslie Hunziker Senior Vice President Investor Relations, Communications & Sustainability [email protected] 239-301-1675Joele Frank, Wilkinson Brimmer Katcher [email protected] T.J. O'Sullivan / 415-378-6841 Maggie Carangelo / 917-865-2500 KEYWORD: FLORIDA UNITED STATES NORTH AMERICA INDUSTRY KEYWORD: OTHER CONSTRUCTION & PROPERTY RESIDENTIAL BUILDING & REAL ESTATE MANUFACTURING COMMERCIAL BUILDING & REAL ESTATE CONSTRUCTION & PROPERTY MACHINERY SOURCE: Herc Holdings Inc. Copyright Business Wire 2025. PUB: 06/02/2025 08:50 AM/DISC: 06/02/2025 08:48 AM
Business Wire
7 days ago
- Business
- Business Wire
Herc Holdings Completes Acquisition of H&E Equipment Services
BONITA SPRINGS, Fla.--(BUSINESS WIRE)--Herc Holdings Inc. (NYSE: HRI) ('Herc' or 'the Company'), one of North America's leading equipment rental suppliers, today announced that it has completed its acquisition of H&E Equipment Services, Inc. d/b/a H&E Rentals ('H&E'). 'The acquisition of H&E accelerates Herc's proven strategy and strengthens our position as a premier rental company in North America,' said Larry Silber, Herc Rentals' president and chief executive officer. 'The addition of H&E's network and capabilities provides Herc with a leading presence in 11 of the top 20 rental regions, a larger fleet that provides our customers with a range of specialty and general rental products, and a talented team who shares our focus on excellence in customer service and safety. We are excited to realize the substantial upside ahead for industry leading growth and superior value creation.' Under the terms of the merger agreement, Herc Rentals acquired all of the issued and outstanding shares of H&E's common stock for, on a per share basis, $78.75 in cash and 0.1287 shares of Herc Rentals common stock. With the completion of the transaction, shares of H&E common stock have ceased trading and will no longer be listed on the NASDAQ. Herc Rentals Advisors Guggenheim Securities, LLC served as lead financial advisor. Credit Agricole Securities (USA) Inc served as co-financial advisor, and Credit Agricole Corporate and Investment Bank served as lead financing bank. Simpson Thacher & Bartlett LLP served as legal advisor. Joele Frank, Wilkinson Brimmer Katcher served as strategic communications advisor. About Herc Holdings Inc. Founded in 1965, Herc Holdings Inc., which operates through its Herc Rentals Inc. subsidiary, is a full-line rental supplier. With the recent acquisition of H&E Equipment Services, we have 613 locations across North America and pro forma 2024 total revenues were $5.1 billion. We offer products and services aimed at helping customers work more efficiently, effectively, and safely. Our classic fleet includes aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction, and lighting equipment. Our ProSolutions® offering includes industry-specific, solutions-based services in tandem with power generation, climate control, remediation and restoration, pumps, and trench shoring equipment as well as our ProContractor professional grade tools. We employ approximately 10,500 employees, who equip our customers and communities to build a brighter future. Learn more at and follow us on Instagram, Facebook and LinkedIn. Cautionary Note Regarding Forward Looking Statements This communication includes 'forward-looking statements' within the meaning of Section 21E of the Securities Exchange Act, as amended. Forward-looking statements include statements related to the Company, H&E and the acquisition of H&E by the Company that involve substantial risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied by such statements. Forward-looking statements in this communication include, among other things, statements about the potential benefits of the transaction, the Company's plans, objectives, expectations and intentions, the financial condition, results of operations and business of each of the Company and H&E, and expected valuation and re-rating opportunities for the combined company. Forward-looking statements are generally identified by the words 'estimates,' 'expects,' 'anticipates,' 'projects,' 'plans,' 'intends,' 'believes,' 'forecasts,' 'looks,' and future or conditional verbs, such as 'will,' 'should,' 'could' or 'may,' as well as variations of such words or similar expressions. All forward-looking statements are based upon our current expectations and various assumptions and apply only as of the date of this communication. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that our expectations, beliefs and projections will be achieved or that the completion and anticipated benefits of the transaction can be guaranteed, and actual results may differ materially from those projected. You should not place undue reliance on forward-looking statements. There are a number of risks, uncertainties and other important factors that could cause our actual results to differ materially from those suggested by our forward-looking statements, including, but not limited to, (i) the Company's ability to implement its plans, forecasts and other expectations with respect to H&E's business after the completion of the transaction and realized expected synergies; (ii) the ability to realize the anticipated benefits of the transaction, including the possibility that the expected benefits from the transaction will not be realized or will not be realized within the expected time period; (iii) problems may arise in successfully integrating the businesses of the Company and H&E, including, without limitation, problems associated with the potential loss of any key employees, customers, suppliers and other counterparties of H&E (iv) the transaction may involve unexpected costs, including, without limitation, the exposure to any unrecorded liabilities or unidentified issues during the due diligence investigation of H&E or that are not covered by insurance, as well as potential unfavorable accounting treatment and unexpected increases in taxes; (v) the Company's business may suffer as a result of uncertainty surrounding the transaction, including any adverse effects on our ability to maintain relationships with customers, employees and suppliers; (vi) any negative effects of the announcement of the transaction or the financing thereof on the market price of the Company common stock or other securities; (vii) the industry may be subject to future risks including those set forth in the 'Risk Factors' section in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and in the other filings with the SEC by each of the Company and H&E and (viii) the Company may not achieve its valuation or re-rating opportunities. The foregoing list of factors is not exhaustive. Investors should carefully consider the foregoing factors and the other risks and uncertainties that affect the businesses of the Company and H&E, including those described in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and in the other filings with the SEC by each of the Company and H&E. All forward-looking statements are expressly qualified in their entirety by such cautionary statements. We undertake no obligation to update or revise forward-looking statements that have been made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events.
Yahoo
22-04-2025
- Business
- Yahoo
Herc's (NYSE:HRI) Q1 Sales Beat Estimates But Full-Year Sales Guidance Misses Expectations Significantly
Equipment rental company Herc Holdings (NYSE:HRI) beat Wall Street's revenue expectations in Q1 CY2025, with sales up 7.1% year on year to $861 million. On the other hand, the company's full-year revenue guidance of $1.61 billion at the midpoint came in 55.8% below analysts' estimates. Its non-GAAP profit of $1.30 per share was 41.2% below analysts' consensus estimates. Is now the time to buy Herc? Find out in our full research report. Revenue: $861 million vs analyst estimates of $852.4 million (7.1% year-on-year growth, 1% beat) Adjusted EPS: $1.30 vs analyst expectations of $2.21 (41.2% miss) Adjusted EBITDA: $339 million vs analyst estimates of $361.9 million (39.4% margin, 6.3% miss) Operating Margin: 18.6%, up from 17.5% in the same quarter last year Free Cash Flow was -$16 million, down from $92 million in the same quarter last year Market Capitalization: $3.18 billion 'As expected, the 2025 operating landscape continues to be a tale of two disparate economic trends,' said Larry Silber, president and chief executive officer. Formerly a subsidiary of Hertz Corporation and with a logo that still bears some similarities to its former parent, Herc Holdings (NYSE:HRI) provides equipment rental and related services to a wide range of industries. Historically, specialty equipment distributors have boasted deep selection and expertise in sometimes narrow areas like single-use packaging or unique lighting equipment. Additionally, the industry has evolved to include more automated industrial equipment and machinery over the last decade, driving efficiencies and enabling valuable data collection. Specialty equipment distributors whose offerings keep up with these trends can take share in a still-fragmented market, but like the broader industrials sector, this space is at the whim of economic cycles that impact the capital spending and manufacturing propelling industry volumes. Examining a company's long-term performance can provide clues about its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Over the last five years, Herc grew its sales at an excellent 13.1% compounded annual growth rate. Its growth beat the average industrials company and shows its offerings resonate with customers, a helpful starting point for our analysis. We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Herc's annualized revenue growth of 11.6% over the last two years is below its five-year trend, but we still think the results suggest healthy demand. Herc also breaks out the revenue for its most important segment, Equipment rentals. Over the last two years, Herc's Equipment rentals revenue (aerial, earthmoving, material handling) averaged 9.5% year-on-year growth. This quarter, Herc reported year-on-year revenue growth of 7.1%, and its $861 million of revenue exceeded Wall Street's estimates by 1%. Looking ahead, sell-side analysts expect revenue to grow 3.2% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and suggests its products and services will face some demand challenges. At least the company is tracking well in other measures of financial health. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Herc has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 19.2%. This result isn't surprising as its high gross margin gives it a favorable starting point. Analyzing the trend in its profitability, Herc's operating margin rose by 8.2 percentage points over the last five years, as its sales growth gave it immense operating leverage. This quarter, Herc generated an operating profit margin of 18.6%, up 1 percentage points year on year. The increase was encouraging, and because its gross margin actually decreased, we can assume it was more efficient because its operating expenses like marketing, R&D, and administrative overhead grew slower than its revenue. Revenue trends explain a company's historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions. Herc's EPS grew at an astounding 28.3% compounded annual growth rate over the last five years, higher than its 13.1% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. Diving into the nuances of Herc's earnings can give us a better understanding of its performance. As we mentioned earlier, Herc's operating margin expanded by 8.2 percentage points over the last five years. On top of that, its share count shrank by 1.4%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business. For Herc, EPS didn't budge over the last two years, a regression from its five-year trend. Given the merits in other parts of its business, we're hopeful it can revert to earnings growth in the coming years. In Q1, Herc reported EPS at $1.30, down from $2.36 in the same quarter last year. This print missed analysts' estimates, but we care more about long-term EPS growth than short-term movements. Over the next 12 months, Wall Street expects Herc's full-year EPS of $11.84 to grow 8.9%. It was good to see Herc narrowly top analysts' revenue expectations this quarter. On the other hand, its Equipment rentals revenue missed and its full-year revenue guidance fell short of Wall Street's estimates. Overall, this quarter could have been better. The stock remained flat at $111.50 immediately following the results. The latest quarter from Herc's wasn't that good. One earnings report doesn't define a company's quality, though, so let's explore whether the stock is a buy at the current price. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it's free. Sign in to access your portfolio
Business Wire
22-04-2025
- Business
- Business Wire
Herc Holdings Reports First Quarter 2025 Results and Affirms 2025 Full Year Guidance
BONITA SPRINGS, Fla.--(BUSINESS WIRE)--Herc Holdings Inc. (NYSE: HRI) ("Herc Holdings" or the "Company") today reported financial results for the quarter ended March 31, 2025. 'As expected, the 2025 operating landscape continues to be a tale of two disparate economic trends,' said Larry Silber, president and chief executive officer. 'Our national account business is growing, fueled by federal and private funding for large construction projects like data centers, manufacturing onshoring and LNG facilities. At the same time, while facility maintenance, municipal, and infrastructure projects are supporting the local markets, other more interest-rate sensitive projects continue to be on hold, restricting overall local account growth. 'Against this uneven backdrop, Herc's diversified business model helps drive resiliency,' said Silber. 'With growth in mega project activity and incremental revenue benefits from last year's acquisitions, we delivered financial results that were in line with our expectations for the seasonally low first quarter. And we remain on pace to outperform the overall equipment rental market again this year as Team Herc continues to identify opportunities to deliver value for our customers, while managing our fleet and capital strategically and with discipline. 'As it relates to the H&E acquisition, with the closing date targeted for mid-year, our operators and salesforce remain focused on running the day-to-day business, and our integration team is actively preparing for the migration of Herc systems and processes. We are excited to bring together two strong cultures that focus on growth and share priorities for customer service and safety.' 2025 First Quarter Financial Results Total revenues increased 7% to $861 million compared to $804 million in the prior-year period. The year-over-year increase of $57 million related to an increase in equipment rental revenue of $20 million, reflecting uneven demand across end markets and incremental revenue from prior year greenfields and acquisitions. Sales of rental equipment increased by $36 million during the period. Dollar utilization decreased to 37.6% in the first quarter compared to 39.7% in the prior-year period. Direct operating expenses were $327 million, or 44.2% of equipment rental revenue, compared to $307 million, or 42.7% in the prior-year period. The increase as a percent of rental revenue related to lower fixed cost absorption due to the normal seasonality associated with the first quarter, particularly facilities costs due to greenfield and acquisition locations and higher insurance costs year-over-year. Depreciation of rental equipment increased 8% to $172 million due to higher year-over-year average fleet size. Non-rental depreciation and amortization increased 14% to $33 million primarily due to an increase in non-rental asset depreciation resulting from the growth of the business. Selling, general and administrative expenses were $118 million compared to $112 million in the prior-year period. As a percent of rental revenue, selling, general and administrative expenses were nearly flat year-over-year. Transaction expenses were $74 million compared to $3 million in the prior-year period. The increase related to costs incurred for the H&E acquisition, primarily a $64 million termination fee paid to United Rentals on behalf of H&E. Interest expense remained relatively flat at $62 million compared with $61 million in the prior-year period. Net loss was $18 million compared to net income of $65 million in the prior-year period. Adjusted net income decreased 45% to $37 million, or $1.30 per diluted share, compared to $67 million, or $2.36 per diluted share, in the prior-year period. The income tax provision in the first quarter was primarily driven by the non-deductible transaction costs related to the H&E acquisition. Adjusted EBITDA remained flat at $339 million and adjusted EBITDA margin was 39.4% compared to 42.2% in the prior-year period. Rental Fleet Net rental equipment capital expenditures were as follows (in millions): As of March 31, 2025, the Company's total fleet was approximately $6.9 billion at OEC. Average fleet at OEC in the first quarter increased 9% compared to the prior-year period. Average fleet age was 47 months as of March 31, 2025 and 2024. Disciplined Capital Management The Company opened 3 new greenfield locations during the three months ended March 31, 2025. Net debt was $4.0 billion as of March 31, 2025, with net leverage of 2.5x unchanged from the same prior-year period. Cash and cash equivalents and unused commitments under the ABL Credit Facility contributed to approximately $1.9 billion of liquidity as of March 31, 2025. The Company declared its quarterly dividend of $0.70, an increase of 5%, paid to shareholders of record as of February 18, 2025 on March 4, 2025. 2025 Outlook—Excluding Cinelease The Company is affirming its full year 2025 equipment rental revenue growth, adjusted EBITDA, and gross and net rental capital expenditures guidance ranges, excluding Cinelease studio entertainment and lighting and grip equipment rental business. The sale process for the Cinelease studio entertainment business is ongoing and a transaction is expected to be completed in 2025. As a leader in an industry where scale matters, the Company expects to continue to gain share by capturing an outsized position of the forecasted higher construction spending in 2025 by investing in its fleet, optimizing its existing fleet, capitalizing on strategic acquisitions and greenfield opportunities, and cross-selling a diversified product portfolio. Earnings Call and Webcast Information Herc Holdings' first quarter 2025 earnings webcast will be held today at 8:30 a.m. U.S. Eastern Time. Interested U.S. parties may call +1-800-715-9871 and international participants should call the country specific dial in numbers listed at using the access code: 9128891. Please dial in at least 10 minutes before the call start time to ensure that you are connected to the call and to register your name and company. Those who wish to listen to the live conference call and view the accompanying presentation slides should visit the Events and Presentations tab of the Investor Relations section of the Company's website at The press release and presentation slides for the call will be posted to this section of the website prior to the call. A replay of the conference call will be available via webcast on the Company website at where it will be archived for 12 months after the call. About Herc Holdings Inc. Founded in 1965, Herc Holdings Inc., which operates through its Herc Rentals Inc. subsidiary, is a full-line rental supplier with 453 locations across North America, and 2024 total revenues were approximately $3.6 billion. We offer products and services aimed at helping customers work more efficiently, effectively, and safely. Our classic fleet includes aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction, and lighting equipment. Our ProSolutions® offering includes industry-specific, solutions-based services in tandem with power generation, climate control, remediation and restoration, pumps, and trench shorting equipment as well as our ProContractor professional grade tools. We employ approximately 7,600 employees, who equip our customers and communities to build a brighter future. Learn more at and follow us on Instagram, Facebook and LinkedIn. Certain Additional Information In this release we refer to the following operating measures: Dollar utilization: calculated by dividing rental revenue (excluding re-rent, delivery, pick-up and other ancillary revenue) by the average OEC of the equipment fleet for the relevant time period, based on the guidelines of the American Rental Association (ARA). OEC: original equipment cost based on the guidelines of the ARA, which is calculated as the cost of the asset at the time it was first purchased plus additional capitalized refurbishment costs (with the basis of refurbished assets reset at the refurbishment date). Forward-Looking Statements This press release includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act, as amended, and the Private Securities Litigation Reform Act of 1995. Forward looking statements are generally identified by the words "estimates," "expects," "anticipates," "projects," "plans," "intends," "believes," "forecasts," "looks," and future or conditional verbs, such as "will," "should," "could" or "may," as well as variations of such words or similar expressions. All forward-looking statements are based upon our current expectations and various assumptions and there can be no assurance that our current expectations will be achieved. You should not place undue reliance on the forward-looking statements. They are subject to future events, risks and uncertainties - many of which are beyond our control - as well as potentially inaccurate assumptions, that could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those projected include, but are not limited to, the following: (1) the cyclical nature of our industry and our dependence on the levels of capital investment and maintenance expenditures by our customers; (2) the competitiveness of our industry, including the potential downward pricing pressures or the inability to increase prices; (3) our dependence on relationships with key suppliers; (4) our heavy reliance on communication networks, centralized information technology systems and third party technology and services and our ability to maintain, upgrade or replace our information technology systems; (5) our ability to respond adequately to changes in technology and customer demands; (6) our ability to attract and retain key management, sales and trades talent; (7) our rental fleet is subject to residual value risk upon disposition; (8) the impact of climate change and the legal and regulatory responses to such change; (9) our ability to execute our strategy to grow through strategic transactions; and (10) our significant indebtedness; and (11) our ability to complete the acquisition of H&E Equipment Services, Inc. and our ability to realize the anticipated benefits of the proposed transaction. Further information on the risks that may affect our business is included in filings we make with the Securities and Exchange Commission from time to time, including our most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q, and in our other SEC filings. We undertake no obligation to update or revise forward-looking statements that have been made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Information Regarding Non-GAAP Financial Measures In addition to results calculated according to accounting principles generally accepted in the United States ('GAAP'), the Company has provided certain information in this release that is not calculated according to GAAP ('non-GAAP'), such as EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per diluted common share, free cash flow and certain results excluding the Cinelease studio entertainment business. Management uses these non-GAAP measures to evaluate operating performance and period-over-period performance of our core business without regard to potential distortions, and believes that investors will likewise find these non-GAAP measures useful in evaluating the Company's performance. These measures are frequently used by security analysts, institutional investors and other interested parties in the evaluation of companies in our industry. Non-GAAP measures should not be considered in isolation or as a substitute for our reported results prepared in accordance with GAAP and, as calculated, may not be comparable to similarly titled measures of other companies. For the definitions of these terms, further information about management's use of these measures as well as a reconciliation of these non-GAAP measures to the most comparable GAAP financial measures, please see the supplemental schedules that accompany this release. (See Accompanying Tables) HERC HOLDINGS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In millions) March 31, 2025 December 31, 2024 ASSETS (unaudited) Cash and cash equivalents $ 48 $ 83 Receivables, net of allowances 554 589 Prepaid expenses 69 47 Other current assets 20 40 Current assets held for sale 18 17 Total current assets 709 776 Rental equipment, net 4,085 4,225 Property and equipment, net 567 554 Right-of-use lease assets 869 852 Intangible assets, net 564 572 Goodwill 682 670 Other long-term assets 8 8 Long-term assets held for sale 221 220 Total assets $ 7,705 $ 7,877 LIABILITIES AND EQUITY Current maturities of long-term debt and financing obligations $ 22 $ 21 Current maturities of operating lease liabilities 39 39 Accounts payable 161 248 Accrued liabilities 237 239 Current liabilities held for sale 15 15 Total current liabilities 474 562 Long-term debt, net 4,026 4,069 Financing obligations, net 99 101 Operating lease liabilities 862 842 Deferred tax liabilities 771 800 Other long-term liabilities 57 47 Long-term liabilities held for sale 58 60 Total liabilities 6,347 6,481 Total equity 1,358 1,396 Total liabilities and equity $ 7,705 $ 7,877 A - 2 Expand HERC HOLDINGS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Unaudited (In millions) Three Months Ended March 31, 2025 2024 Cash flows from operating activities: Net income (loss) $ (18 ) $ 65 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation of rental equipment 172 160 Depreciation of property and equipment 22 19 Amortization of intangible assets 11 10 Amortization of deferred debt and financing obligations costs 1 1 Stock-based compensation charges 6 5 Provision for receivables allowances 14 12 Deferred taxes (29 ) 9 Gain on sale of rental equipment (29 ) (23 ) Other — 3 Changes in assets and liabilities: Receivables 20 (7 ) Other assets (20 ) (6 ) Accounts payable (18 ) (2 ) Accrued liabilities and other long-term liabilities 39 (6 ) Net cash provided by operating activities 171 240 Cash flows from investing activities: Rental equipment expenditures (187 ) (181 ) Proceeds from disposal of rental equipment 94 61 Non-rental capital expenditures (33 ) (30 ) Proceeds from disposal of property and equipment 4 2 Acquisitions, net of cash acquired (11 ) (148 ) Net cash used in investing activities (133 ) (296 ) Cash flows from financing activities: Proceeds from revolving lines of credit and securitization 520 385 Repayments on revolving lines of credit and securitization (561 ) (302 ) Principal payments under finance lease and financing obligations (5 ) (5 ) Dividends paid (21 ) (20 ) Other financing activities, net (6 ) (10 ) Net cash provided by (used in) financing activities (73 ) 48 Effect of foreign exchange rate changes on cash and cash equivalents — — Net change in cash and cash equivalents during the period (35 ) (8 ) Cash and cash equivalents at beginning of period 83 71 Cash and cash equivalents at end of period $ 48 $ 63 A - 3 Expand HERC HOLDINGS INC. AND SUBSIDIARIES SUPPLEMENTAL SCHEDULES EBITDA AND ADJUSTED EBITDA RECONCILIATIONS Unaudited (In millions) EBITDA and adjusted EBITDA - EBITDA represents the sum of net income (loss), provision (benefit) for income taxes, interest expense, net, depreciation of rental equipment and non-rental depreciation and amortization. Adjusted EBITDA represents EBITDA plus the sum of transaction related costs, restructuring and restructuring related charges, spin-off costs, non-cash stock-based compensation charges, loss on extinguishment of debt (which is included in interest expense, net), impairment charges, gain (loss) on the disposal of a business and certain other items. EBITDA and adjusted EBITDA do not purport to be alternatives to net income as an indicator of operating performance. Additionally, neither measure purports to be an alternative to cash flows from operating activities as a measure of liquidity, as they do not consider certain cash requirements such as interest payments and tax payments. Adjusted EBITDA Margin - Adjusted EBITDA Margin, calculated by dividing Adjusted EBITDA by Total Revenues, is a commonly used profitability ratio. Expand Three Months Ended March 31, 2025 2024 Net income (loss) $ (18 ) $ 65 Income tax provision 10 16 Interest expense, net 62 61 Depreciation of rental equipment 172 160 Non-rental depreciation and amortization 33 29 EBITDA 259 331 Non-cash stock-based compensation charges 6 5 Transaction related costs 74 3 Adjusted EBITDA $ 339 $ 339 Total revenues 861 804 Adjusted EBITDA $ 339 $ 339 Adjusted EBITDA margin 39.4 % 42.2 % A - 4 Expand HERC HOLDINGS INC. AND SUBSIDIARIES SUPPLEMENTAL SCHEDULES EXCLUDING STUDIO ENTERTAINMENT RECONCILIATIONS Unaudited (in millions) EBITDA, Adjusted EBITDA, REBITDA, Adjusted EBITDA Margin, REBITDA Margin and REBITDA Flow-Through Excluding Studio Entertainment - Each metric below has been adjusted to exclude the studio entertainment business due to the intent to sell that business and provides the operating performance of the remaining business. Expand Three Months Ended March 31, 2025 Three Months Ended March 31, 2024 Herc Studio Ex-Studio Herc Studio Ex-Studio Equipment rental revenue $ 739 $ 15 $ 724 $ 719 $ 29 $ 690 Total revenues 861 17 844 804 30 774 Total expenses 869 17 852 723 21 702 Income (loss) before income taxes (8 ) — (8 ) 81 9 72 Income tax (provision) benefit (10 ) — (10 ) (16 ) (2 ) (14 ) Net income (loss) (18 ) — (18 ) 65 7 58 Income tax provision 10 — 10 16 2 14 Interest expense, net 62 — 62 61 — 61 Depreciation of rental equipment 172 — 172 160 — 160 Non-rental depreciation and amortization 33 — 33 29 — 29 EBITDA 259 — 259 331 9 322 Non-cash stock-based compensation charges 6 — 6 5 — 5 Transaction related costs 74 1 73 3 1 2 Adjusted EBITDA 339 1 338 339 10 329 Less: Gain (loss) on sales of rental equipment 29 1 28 23 — 23 Less: Gain (loss) on sales of new equipment, parts and supplies 3 — 3 3 1 2 Rental Adjusted EBITDA (REBITDA) $ 307 $ — $ 307 $ 313 $ 9 $ 304 Total revenues $ 861 $ 17 $ 844 $ 804 $ 30 $ 774 Adjusted EBITDA $ 339 $ 1 $ 338 $ 339 $ 10 $ 329 Adjusted EBITDA margin 39.4 % 5.9 % 40.0 % 42.2 % 33.3 % 42.5 % Total revenues $ 861 $ 17 $ 844 $ 804 $ 30 $ 774 Less: Sales of rental equipment 105 1 104 69 — 69 Less: Sales of new equipment, parts and supplies 11 1 10 9 1 8 Equipment rental, service and other revenues $ 745 $ 15 $ 730 $ 726 $ 29 $ 697 Equipment rental, service and other revenues $ 745 $ 15 $ 730 $ 726 $ 29 $ 697 Adjusted REBITDA $ 307 $ — $ 307 $ 313 $ 9 $ 304 Adjusted REBITDA margin 41.2 % — % 42.1 % 43.1 % 31.0 % 43.6 % A - 5 Expand HERC HOLDINGS INC. AND SUBSIDIARIES SUPPLEMENTAL SCHEDULES ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER DILUTED SHARE Unaudited (In millions) Adjusted Net Income and Adjusted Earnings Per Diluted Share - Adjusted Net Income represents the sum of net income (loss), restructuring and restructuring related charges, spin-off costs, loss on extinguishment of debt, impairment charges, transaction related costs, gain (loss) on the disposal of a business and certain other items. Adjusted Earnings per Diluted Share represents Adjusted Net Income divided by diluted shares outstanding. Adjusted Net Income and Adjusted Earnings Per Diluted Share are important measures to evaluate our results of operations between periods on a more comparable basis and to help investors analyze underlying trends in our business, evaluate the performance of our business both on an absolute basis and relative to our peers and the broader market, provide useful information to both management and investors by excluding certain items that may not be indicative of our core operating results and operational strength of our business. Expand Three Months Ended March 31, 2025 2024 Net income (loss) $ (18 ) $ 65 Transaction related costs 74 3 Tax impact of adjustments (1) (19 ) (1 ) Adjusted net income $ 37 $ 67 Diluted shares outstanding 28.5 28.4 Adjusted earnings per diluted share $ 1.30 $ 2.36 (1) The tax rate applied for adjustments is 25.5% and reflects the statutory rates in the applicable entities. A - 6 Expand HERC HOLDINGS INC. AND SUBSIDIARIES SUPPLEMENTAL SCHEDULES FREE CASH FLOW Unaudited (In millions) Free cash flow represents net cash provided by (used in) operating activities less rental equipment expenditures and non-rental capital expenditures, plus proceeds from disposal of rental equipment, proceeds from disposal of property and equipment, and other investing activities. Free cash flow is used by management in analyzing the Company's ability to service and repay its debt, fund potential acquisitions and to forecast future periods. However, this measure does not represent funds available for investment or other discretionary uses since it does not deduct cash used to service debt or for other non-discretionary expenditures. Expand
Yahoo
31-03-2025
- Business
- Yahoo
Reflecting On Specialty Equipment Distributors Stocks' Q4 Earnings: Herc (NYSE:HRI)
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let's take a look at how Herc (NYSE:HRI) and the rest of the specialty equipment distributors stocks fared in Q4. Historically, specialty equipment distributors have boasted deep selection and expertise in sometimes narrow areas like single-use packaging or unique lighting equipment. Additionally, the industry has evolved to include more automated industrial equipment and machinery over the last decade, driving efficiencies and enabling valuable data collection. Specialty equipment distributors whose offerings keep up with these trends can take share in a still-fragmented market, but like the broader industrials sector, this space is at the whim of economic cycles that impact the capital spending and manufacturing propelling industry volumes. The 8 specialty equipment distributors stocks we track reported a slower Q4. As a group, revenues missed analysts' consensus estimates by 0.8% while next quarter's revenue guidance was in line. Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 11.8% since the latest earnings results. Formerly a subsidiary of Hertz Corporation and with a logo that still bears some similarities to its former parent, Herc Holdings (NYSE:HRI) provides equipment rental and related services to a wide range of industries. Herc reported revenues of $951 million, up 14.4% year on year. This print exceeded analysts' expectations by 2.5%. It was still a decent quarter for the company with a solid beat of analysts' adjusted operating income estimates. "In 2024, despite a more challenging market than anticipated, we delivered another year of record results, significantly outperforming industry revenue growth by leveraging the strength of tenured customer relationships, the value derived from strategic capital-allocation priorities and our diversified position across products, geographies and end markets," said Larry Silber, president and chief executive officer. Herc achieved the fastest revenue growth of the whole group. Still, the market seems discontent with the results. The stock is down 19% since reporting and currently trades at $137.43. Is now the time to buy Herc? Access our full analysis of the earnings results here, it's free. Owning the largest rental fleet in the world, United Rentals (NYSE:URI) provides equipment rental and related services to construction, industrial, and infrastructure industries. United Rentals reported revenues of $4.10 billion, up 9.8% year on year, outperforming analysts' expectations by 3.9%. The business had a strong quarter with an impressive beat of analysts' organic revenue and adjusted operating income estimates. United Rentals delivered the biggest analyst estimates beat among its peers. Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 19% since reporting. It currently trades at $614.20. Is now the time to buy United Rentals? Access our full analysis of the earnings results here, it's free. Founded in 1947, Richardson Electronics (NASDAQ:RELL) is a distributor of power grid and microwave tubes as well as consumables related to those products. Richardson Electronics reported revenues of $49.49 million, up 12.1% year on year, falling short of analysts' expectations by 3.5%. It was a disappointing quarter as it posted a significant miss of analysts' EBITDA and EPS estimates. As expected, the stock is down 23.1% since the results and currently trades at $11.31. Read our full analysis of Richardson Electronics's results here. Founded in 1984, Alta Equipment Group (NYSE:ALTG) is a provider of industrial and construction equipment and services across the Midwest and Northeast United States. Alta reported revenues of $498.1 million, down 4.5% year on year. This number beat analysts' expectations by 2.6%. Aside from that, it was a slower quarter as it logged a significant miss of analysts' adjusted operating income estimates. The stock is down 14.2% since reporting and currently trades at $4.37. Read our full, actionable report on Alta here, it's free. Inspired by a family gas station, Custom Truck One Source (NYSE:CTOS) is a distributor of trucks and heavy equipment. Custom Truck One Source reported revenues of $520.7 million, flat year on year. This print missed analysts' expectations by 3.7%. Aside from that, it was a strong quarter as it produced an impressive beat of analysts' EPS estimates and a solid beat of analysts' adjusted operating income estimates. Custom Truck One Source delivered the highest full-year guidance raise among its peers. The stock is up 7.7% since reporting and currently trades at $4.31. Read our full, actionable report on Custom Truck One Source here, it's free. Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. Join Paid Stock Investor Research Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here. Sign in to access your portfolio
