29.04.2019

Strong quarter for H&E

US based sales and rental company H&E Equipment has reported a strong start to the year in terms of revenues and profits.

Total revenues increased 20.4 percent to $313.6 million with improvements in all areas, except ‘other’. The rental operation which now makes up more than half the business saw revenue increases of 29 percent, with slightly lower utilisation at 70 percent, but on a fleet 23.4 percent larger than last year. Rental rates continued to improve and were up 2.3 percent year on year. Pre-tax profits jumped 48 percent to $19.35 million.

The company spent $69.8 million on new equipment for the rental fleet in the quarter, up almost 25 percent on the same quarter last year, while selling $28 million of older equipment, leaving the average age of the fleet – which includes aerial lifts, cranes and telehandlers, as well as earthmoving and general equipment - at the end of the period was 35.2 months.

Chief executive Brad Barber said: “Our business is off to a strong start this year, delivering favourable results for the first quarter. Demand for equipment in our non-residential construction markets remained healthy and our rental business produced strong gains. We achieved a 2.3 percent increase in rates versus the year ago quarter and maintained solid utilisation on a significantly larger fleet.”

“With clearer visibility into the year, our outlook remains positive. Since the return to normal seasonal conditions, project activity in our end user markets is accelerating and physical utilisation is improving. We remain extremely focused on growing our business both organically and through acquisitions.”

Vertikal Comment

An excellent start to the year for H&E which has making solid progress for some time now and still has plenty to after in terms of geographical expansion and growth within its existing markets.
This is also a good first quarter for Brad Barber, the career H&E employee who officially took over as chief executive from long term chief executive John Engquist at the start of the year - although Engquist remains as executive chairman of course. See new CEO for H7E

The company is doing well and will almost certainly be on the lookout for new acquisition opportunities.

A very positive set of numbers.