NYSE$HRI

Herc Holdings · Q4 2019 earnings

Q4 2019 earnings · · Investor relations

Briefing

Herc Holdings reported mixed results with equipment rental revenue increasing, total revenues decreasing slightly, and net income increasing for Q4 2019.

Herc Holdings reported a slight decrease in total revenues but an increase in equipment rental revenue and net income in Q4 2019. The company's strategic initiatives led to pricing improvements and operating efficiency gains, resulting in the highest fourth-quarter adjusted EBITDA margin since the spin-off in 2016.

  • Equipment rental revenue increased by 2.1% to $457.0 million.
  • Total revenues decreased slightly by 0.7% to $540.1 million.
  • Net income increased by 5.4% to $35.1 million, or $1.20 per diluted share.
  • Adjusted EBITDA increased by 8.1% to $214.4 million, with adjusted EBITDA margin rising to 39.7%.

Headline financials

Total Revenue

$540M

Previous: $544M-0.7%
EPS (adj)

$1.33

Previous: $0.95+40.0%
Total Fleet OEC

$3.82B

No prior period
Capital Expenditures

$22M

Previous: $19.1M+15.2%
Free Cash Flow

$172M

Previous: $165M+4.5%
Net Income

$35.1M

Previous: $33.3M+5.4%
Operating Income

$53.2M

No prior period
Gross Profit

$158M

Previous: $155M+1.9%
Cash & Equivalents

$33M

Previous: $27.8M+18.7%
Total Assets

$3.82B

Previous: $3.61B+5.7%
Stock-Based Comp

$7M

Previous: $3.5M+100.0%

Revenue & EPS history

Herc Holdings · Revenue · Quarterly

$540M

Q4 2019-0.7%vs Q4 2018
Beat estimate in 9 of 16 quarters(56%)
ActualEstimate

Revenue by segment

Herc Holdings · $540M total across 4 segments · Q4 2019

  • Equipment Rental
    $457M+2.1%
  • Sales of Rental Equipment
    $71M-11.9%
  • New Equipment & Parts
    $9.9M-23.3%
  • Service and Other
    $2.2M-12.0%

Forward guidance

Herc Holdings anticipates adjusted EBITDA growth for 2020 between 3% to 7% over 2019. The company plans a moderate increase in net fleet capital expenditures to improve fleet mix and expects to generate substantial positive free cash flow, primarily used to reduce net leverage.

Tailwinds

  • Expect adjusted EBITDA in 2020 to grow between approximately 3% to 7% over 2019
  • Plan a moderate increase in net fleet capital expenditures in 2020 over last year to improve our mix with modest fleet growth.
  • Expect to continue to generate substantial positive free cash flow this year
  • Free cash flow will be primarily used to reduce net leverage
  • Targeted branch openings are expected to drive future profitability

Headwinds

  • Company does not provide forward-looking guidance for certain financial measures on a GAAP basis.
  • Items contained in the GAAP measures, which may be significant, cannot be reasonably estimated.
  • Restructuring and restructuring-related charges cannot be reasonably estimated.
  • Gains and losses from asset sales cannot be reasonably estimated.
  • Spin-off costs cannot be reasonably estimated.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2019

Historical avgQ4 2019

-0.1%

Avg return

Earnings day

-0.7%

Avg return

5 days after

-0.8%

Avg return

30 days after

49%

33 / 67 earnings

Positive

+23.9%

Q3 2024

Best reaction

-16.5%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-1.7%+6.8%+9.9%
Q4 2025-13.0%-11.4%-40.4%
Q3 2025+4.1%+6.6%+3.0%
Q1 2025-8.2%-2.6%+14.6%
Q4 2024-6.0%-10.8%-37.8%
Q3 2024+23.9%+23.9%+28.8%
Q2 2024+1.1%+6.9%-4.2%
Q1 2024+3.6%+2.6%+0.5%
Q4 2023-7.2%-4.7%+1.6%
Q3 2023-1.5%-1.8%+15.9%
Q2 2023-5.4%-5.3%-9.3%
Q1 2023-7.1%-7.6%-5.0%
Q4 2022-2.6%-2.8%-26.1%
Q3 2022-5.3%+3.1%+20.8%
Q2 2022+2.3%+2.1%+17.1%
Q1 2022-16.3%-19.6%-32.3%
Q4 2021-14.3%-11.6%-13.9%
Q3 2021+0.2%-7.6%+0.1%
Q2 2021+0.0%+3.1%+1.8%
Q1 2021+4.1%+12.0%+8.0%
Q4 2020+7.6%+16.1%+36.5%
Q3 2020+2.3%-4.0%+25.5%
Q2 2020+2.1%-3.9%+14.0%
Q1 2020+3.5%+17.1%+14.8%
Q4 2019-0.9%-3.8%-48.1%
Q3 2019-9.8%-6.7%-2.1%
Q2 2019-5.4%-9.9%-8.6%
Q1 2019-6.2%-11.6%-29.3%
Q4 2018+12.2%+7.0%-2.8%
Q3 2018+10.7%+10.9%-11.4%
Q2 2018-7.7%-9.2%-12.1%
Q1 2018+3.9%+6.0%+6.3%
Q4 2017+0.8%+1.7%-1.8%
Q3 2017+14.9%+11.5%+27.0%
Q2 2017-14.9%-14.3%-0.9%
Q1 2017+2.4%-5.7%-14.2%
Q4 2016-6.5%-9.1%-5.4%
Q3 2016+13.4%+21.5%+29.2%
Q4 2015-9.8%-10.8%-1.6%
Q2 2016-9.8%-10.8%-1.6%
Q1 2016-0.4%
Q3 2015-13.0%
Q2 2015+11.5%
Q4 2014+11.5%
Q2 2014+11.5%
Q3 2014+11.5%
Q1 2015+11.5%
Q1 2014+6.3%
Q4 2013-0.9%
Q3 2013-1.5%
Q2 2013-0.6%
Q1 2013-1.6%
Q4 2012+2.2%
Q3 2012-3.7%
Q2 2012+4.5%
Q1 2012+1.5%
Q4 2011-1.7%
Q3 2011+2.1%
Q2 2011-16.5%
Q1 2010-0.4%
Q1 2011+1.5%
Q4 2008+2.3%
Q3 2010+2.2%
Q3 2009+2.2%
Q4 2009-1.1%
Q2 2009-1.1%
Q2 2010-1.1%

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