Herc Holdings reported third-quarter total revenue dropped to $456.7 million from $508.1 million in the same period in 2019. Rental revenue for the quarter was $402.3 million, down 12 percent from $459.6 million.
“Volume improved sequentially throughout the third quarter as many of our markets steadily recovered from the impact of Covid-19 and normal seasonality returned to the business,” said Larry Silber, president/CEO, in a prepared statement. “We continued to improve adjusted EBITDA margin as our operating efficiency and cost control initiatives reduced third quarter costs compared to the prior year. Despite the challenging business environment, our customer and industry diversification strategy continued to demonstrate the resilience of our business model.”
The company said the decline in total revenue related primarily to lower equipment rental revenue, offset by an increase in the sales of rental equipment of $9.9 million. Pricing declined 0.8 percent compared to the same period in 2019.
Nine-month financials reveal a 10-percent drop in rental revenue from $1.25 billion to $1.12 billion, primarily due to the impact of the coronavirus. Total revenue for the period is down 14 percent, to $1.26 billion from $1.46 billion in the same period of 2019. Lower equipment rental revenue and sales of rental equipment were the primary factors contributing to the decline, the company said. Pricing increased 0.4 percent compared to the same period in
2019.
Average fleet age rose from 44 months last year to 47 months as of September 30, 2020. Fleet expenditures of $273.2 million gross were offset by proceeds from disposals of $114.1 million for a net expenditure of $159.1 million for the first nine months of the fiscal year. This compares to a gross fleet expenditure of $506.7 million in the comparable prior-year period.
“We currently estimate fourth quarter fleet on rent is likely to decline approximately 4 percen to 6 percent and rental revenue to decline approximately 6 percent to 8 percent year-over-year,” Silber said.
Source: Herc Holdings
