Drop in revenues for HERC
By Helen Wright10 November 2015
Hertz Equipment Rental Corp (HERC), the equipment rental division of car rental specialist Hertz, has reported lower earnings and revenues for the third quarter of 2015.
Hertz said total worldwide equipment rental revenues stood at US$401 million (€373 million) in the three months to 30 September, down 3% year-on-year. However, the company said that excluding the impact of foreign currency, these revenues increased 1%.
It said worldwide revenues for the third quarter were boosted by a 3% increase in equipment rental volumes, driven by demand from small local contractors and specialty segments as HERC diversifies its business.
HERC’s revenues were also negatively affected by continuing weak performance in serving upstream oil and gas markets during the quarter – in North America, for example, revenue in these upstream oil and gas markets decreased 26% year-on-year, while non-oil and gas markets revenue increased 14%.
In response to the continued weakness in oil and gas markets, HERC reduced its equipment fleet in this segment by 16% in the third quarter year-over-year.
HERC’s third quarter adjusted pre-tax income for the third quarter was US$54 million (€50 million), a decrease from US$79 million (€73 million) in the prior year period.
Hertz CEO John Tague said the company was making progress on its preparations to separate HERC as a stand-alone company.
At the start of November, Hertz sold HERC’s French and Spanish business to French rental company Loxam.
HERC confirmed its full-year adjusted earnings before interest, tax, depreciation and amortisation guidance of between US$575 million (€535 million) and US$625 million (€582 million).