Strong performance from Herc
US based Herc Rentals has posted a strong full year performance.
Total revenues for the year to the end of December were $1.78 billion down 11 percent on 2019, mostly due to lower rentals, but also fewer fleet disposals. Pricing actually edged up a tenth of a percent, while utilisation dipped. Pre-tax profit was $94.1 million up almost 50 percent on 2019, thanks to lower costs and interest charges, but mostly to the fact that last year the company took a $53.6 million write off for the early retirement of some of its loans. If ‘exceptionals’ are left off this year’s pre-tax profit would have come in around seven percent lower than in 2019.
Capital expenditure was roughly half the level of 2019 at $344.1 million, leaving the average age of the fleet at 46 months compared to 45 at the end of 2019.
Chief executive Larry Silber said: "We exceeded our expectations for the fourth quarter and have good momentum going into 2021. During the year, we adjusted fleet to respond to the declines in volume related to the impact of Covid-19 on our customers and focused on controlling costs. The quick implementation of those initiatives led to our improved adjusted EBITDA margin and excellent free cash flow for the full year. Our commitment to customer service and consistent implementation of a strategy to diversify our customer and industry base continues to demonstrate the strength of our business model."
This is a great result form Herc which really does appear to have found its Mojo. Expect good things from the company in 2021.