21.02.2022

Record year for Herc

US-based Herc Rentals has reported record revenues for the full year, 2021.

Total revenues increased 16.4 percent to $2.07 billion, largely driven by rental revenues which increased almost 24 percent, thanks to a 2.1 percent hike in rental rates and the 11 acquisitions Herc made over the year which added a total of 33 new locations. A further five new greenfield sites were opened to help boost organic growth. Pre-tax profits for the year tripled to $290 million.

In the fourth quarter total revenues increased 11 percent to $578 million, once again driven by rental activity with utilisation improving forcing rates to rise 3.5 percent, while pre-tax profits doubled to $91.4 million. Gross rental equipment capital expenditures for the year was $593.8 million compared to $344.1 million in 2020. Sales of used equipment from the fleet were $106.9 million compared to $192.5 million in 2020. This left the average age of the fleet at 49 months compared to 46 months a year earlier. The company is planning to double its expenditure this year to somewhere in the region of $1 to $1.4 billion gross, net of used equipment sales.

Chief executive Larry Silber said: "We continued our 'shift into high gear' with an excellent fourth quarter. Rental revenue increased 26.9 percent over the prior year and dollar utilisation was a record 44.6 percent. Outstanding execution by our operations and field support team was enhanced by strong demand in our markets and a positive operating environment. The healthy momentum in volume and rate trends we closed within 2021 are expected to contribute to strong growth in 2022."

Vertikal Comment

This is a decent result from Herc which does appear to be on a consistent upward trend. It is managing to keep up with its main competitors such as United Rentals and Ashtead and is set to achieve a record result for 2022.