ESTERO, Fla., May 6, 2019
/PRNewswire/ -- Hertz Global Holdings, Inc. (NYSE: HTZ) ("Hertz
Global" or the "Company") today reported results for its first
quarter 2019.
First Quarter 2019 Compared to First Quarter
2018:
- Total revenues up 2%, up 4% on a constant currency basis
- U.S. RAC total revenues up 7%: Transaction Days up 4%, Total
RPD up 2%
- U.S. RAC Depreciation Per Unit Per Month decreased 15%
- Net loss attributable to Hertz Global improved 27%
- Adjusted Corporate EBITDA improved 93%
"We continue to drive profitable revenue growth with focus and
discipline. In the first quarter, our solid results reflect
increased revenue per unit and improved operating margin through
strong pricing, volume and fleet management," said Kathryn V. Marinello, President and Chief
Executive Officer of Hertz Global. "These catalysts, coupled with
expanding capabilities in service excellence, marketing
segmentation and innovation, and supported by our commitment to
operating efficiency, position the company for predictable,
sustainable growth, while allowing us to capitalize on strategic
opportunities going forward."
For the first quarter 2019, total revenues were $2.1 billion, a 2% increase versus the first
quarter 2018. Net loss attributable to Hertz Global was
$147 million, or $1.75 loss per diluted share, compared to
$202 million, or $2.43 loss per diluted share. The Company
reported Adjusted Net Loss for the first quarter 2019 of
$83 million, or $0.99 Adjusted Diluted Loss Per
Share, compared to $131 million,
or $1.58, for the same period last
year. Adjusted Corporate EBITDA was a negative $4 million, compared to negative $59 million.
|
U.S. RENTAL CAR
("U.S. RAC") SUMMARY
|
|
|
U.S.
RAC(1)
|
Three Months
Ended
March 31,
|
|
Percent
Inc/(Dec)
|
|
|
($ in millions,
except where noted)
|
2019
|
|
2018
|
|
|
|
Total
revenues
|
$
|
1,520
|
|
|
$
|
1,426
|
|
|
7
|
%
|
|
|
Depreciation of
revenue earning vehicles and lease charges
|
$
|
386
|
|
|
$
|
434
|
|
|
(11)
|
%
|
|
|
Direct vehicle
operating ("DOE") and selling, general & administrative
("SG&A") expenses
|
$
|
1,097
|
|
|
$
|
1,026
|
|
|
7
|
%
|
|
|
DOE and SG&A
expenses as a percentage of total revenues
|
72
|
%
|
|
72
|
%
|
|
20
|
|
bps
|
|
Income (loss) before
income taxes
|
$
|
14
|
|
|
$
|
(68)
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
Adjusted Pre-tax
Income (Loss)
|
$
|
25
|
|
|
$
|
(48)
|
|
|
NM
|
|
|
|
Adjusted Pre-tax
Margin
|
2
|
%
|
|
(3)
|
%
|
|
500
|
|
bps
|
|
|
|
|
|
|
|
|
Adjusted Corporate
EBITDA
|
$
|
7
|
|
|
$
|
(48)
|
|
|
NM
|
|
|
|
Adjusted Corporate
EBITDA Margin
|
—
|
%
|
|
(3)
|
%
|
|
380
|
|
bps
|
|
|
|
|
|
|
|
|
Average Vehicles (in
whole units)
|
501,767
|
|
|
478,600
|
|
|
5
|
%
|
|
|
Vehicle
Utilization
|
79
|
%
|
|
79
|
%
|
|
(60)
|
|
bps
|
|
Transaction Days (in
thousands)
|
35,582
|
|
|
34,203
|
|
|
4
|
%
|
|
|
Total RPD (in whole
dollars)
|
$
|
41.90
|
|
|
$
|
40.93
|
|
|
2
|
%
|
|
|
Total RPU Per Month
(in whole dollars)
|
$
|
990
|
|
|
$
|
975
|
|
|
2
|
%
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
|
256
|
|
|
$
|
302
|
|
|
(15)
|
%
|
|
|
NM - Not
Meaningful
|
Total U.S. RAC revenues increased 7% compared to the
first quarter of 2018. Transaction days grew 4% driven by expanding
volume to transportation network company drivers ("TNC"). Pricing,
as measured by Total Revenue Per Transaction Day (Total RPD),
increased 2% in the quarter, and time and mileage pricing was up
4%, driven by our highest-profit leisure categories and the TNC
business year-over-year.
Average vehicles were up 5%, driven by 85% growth in the
Company's TNC fleet. Excluding TNC, average vehicles were up 1%.
Higher revenue and stable Utilization led to a 2% increase in Total
RPU, an important measure of asset efficiency.
Depreciation Per Unit Per Month decreased 15% on favorable
vehicle acquisition prices, continued strength in residual values
and an increase in the number of vehicle dispositions through the
Company's higher-return channels year over year.
Adjusted Corporate EBITDA improved $55
million in the first quarter and Adjusted Corporate EBITDA
Margin expanded 380 basis points, driven by higher revenue and
lower vehicle depreciation.
|
INTERNATIONAL
RENTAL CAR ("INTERNATIONAL RAC") SUMMARY
|
|
|
International
RAC(1)
|
Three Months
Ended
March 31,
|
|
Percent
Inc/(Dec)
|
|
|
($ in millions,
except where noted)
|
2019
|
|
2018
|
|
|
|
Total
revenues
|
$
|
433
|
|
|
$
|
468
|
|
|
(7)
|
%
|
|
|
Depreciation of
revenue earning vehicles and lease charges
|
$
|
97
|
|
|
$
|
102
|
|
|
(5)
|
%
|
|
|
DOE and SG&A
expenses
|
$
|
338
|
|
|
$
|
360
|
|
|
(6)
|
%
|
|
|
DOE and SG&A
expenses as a percentage of total revenues
|
78
|
%
|
|
77
|
%
|
|
110
|
|
bps
|
|
Income (loss) before
income taxes
|
$
|
(24)
|
|
|
$
|
(12)
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
Adjusted Pre-tax
Income (Loss)
|
$
|
(18)
|
|
|
$
|
(6)
|
|
|
200
|
%
|
|
|
Adjusted Pre-tax
Margin
|
(4)
|
%
|
|
(1)
|
%
|
|
(290)
|
|
bps
|
|
|
|
|
|
|
|
|
Adjusted Corporate
EBITDA
|
$
|
(13)
|
|
|
$
|
—
|
|
|
NM
|
|
|
|
Adjusted Corporate
EBITDA Margin
|
(3)
|
%
|
|
—
|
%
|
|
(300)
|
|
bps
|
|
|
|
|
|
|
|
|
Average Vehicles (in
whole units)
|
152,747
|
|
|
148,700
|
|
|
3
|
%
|
|
|
Vehicle
Utilization
|
74
|
%
|
|
75
|
%
|
|
(90)
|
|
bps
|
|
Transaction Days (in
thousands)
|
10,127
|
|
|
9,974
|
|
|
2
|
%
|
|
|
Total RPD (in whole
dollars)
|
$
|
42.56
|
|
|
$
|
43.41
|
|
|
(2)
|
%
|
|
|
Total RPU Per Month
(in whole dollars)
|
$
|
941
|
|
|
$
|
971
|
|
|
(3)
|
%
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
|
212
|
|
|
$
|
211
|
|
|
—
|
%
|
|
|
NM - Not
Meaningful
|
Total International RAC revenues decreased 7% year over year,
and were flat on a constant currency basis. Volume was up 2% driven
by strong business and leisure growth in Asia Pacific. Total RPD was down 2% partly due
to the timing of the Easter holiday in 2019 versus 2018.
Adjusted Corporate EBITDA was impacted by the decline in
revenue, partially offset by lower direct operating expense.
|
ALL OTHER
OPERATIONS SUMMARY
|
|
|
All Other
Operations(1)
|
Three Months
Ended
March 31,
|
|
Percent
Inc/(Dec)
|
|
|
($ in
millions)
|
2019
|
|
2018
|
|
|
|
Total
revenues
|
$
|
154
|
|
|
$
|
169
|
|
|
(9)
|
%
|
|
|
Depreciation of
revenue earning vehicles and lease charges
|
$
|
109
|
|
|
$
|
125
|
|
|
(13)
|
%
|
|
|
DOE and SG&A
expenses
|
$
|
13
|
|
|
$
|
19
|
|
|
(32)
|
%
|
|
|
DOE and SG&A
expenses as a percentage of total revenues
|
8
|
%
|
|
11
|
%
|
|
(280)
|
|
bps
|
|
Income (loss) before
income taxes
|
$
|
24
|
|
|
$
|
19
|
|
|
26
|
%
|
|
|
|
|
|
|
|
|
|
Adjusted Pre-tax
Income (Loss)
|
$
|
25
|
|
|
$
|
22
|
|
|
14
|
%
|
|
|
Adjusted Pre-tax
Margin
|
16
|
%
|
|
13
|
%
|
|
320
|
|
bps
|
|
|
|
|
|
|
|
|
Adjusted Corporate
EBITDA
|
$
|
22
|
|
|
$
|
20
|
|
|
10
|
%
|
|
|
Adjusted Corporate
EBITDA Margin
|
14
|
%
|
|
12
|
%
|
|
250
|
|
bps
|
|
|
|
|
|
|
|
|
Average Vehicles (in
whole units) - Donlen
|
192,799
|
|
|
191,600
|
|
|
1
|
%
|
|
All Other Operations primarily is comprised of the Company's
Donlen leasing operations. Lower year-over-year revenue and
depreciation of revenue earning vehicles and lease charges were
driven by the impact of a change in presentation for certain leased
vehicles in the first quarter of 2019 versus 2018.
|
(1)
|
Adjusted Pre-tax
Income (Loss), Adjusted Pre-tax Margin, Adjusted Corporate EBITDA,
Adjusted Corporate EBITDA Margin, Adjusted Net Income (Loss) and
Adjusted Diluted Earnings (Loss) Per Share are non-GAAP
measures. Average Vehicles, Transaction Days, Total RPD, Total
RPU Per Month and Depreciation Per Unit Per Month are key metrics.
See the accompanying Supplemental Schedules and Definitions for the
reconciliations and definitions for each of these non-GAAP measures
and key metrics and the reason the Company's management believes
that this information is useful to investors.
|
RESULTS OF THE HERTZ CORPORATION
The GAAP and non-GAAP profitability metrics for Hertz Global's
operating subsidiary, The Hertz Corporation ("Hertz"), are
materially the same as those for Hertz Global.
EARNINGS WEBCAST INFORMATION
Hertz Global's live webcast and conference call to discuss its
first quarter 2019 results will be held on May 7,
2019, at 8:30 a.m. Eastern Time, and
can be accessed through a link on the Investor Relations section of
the Hertz website, IR.Hertz.com, or by dialing (800) 230-1085
and providing passcode 466474. Investors are encouraged to
dial-in approximately 10 minutes prior to the call. A web
replay will remain available for approximately one year. A
telephone replay will be available one hour following the
conclusion of the call for one year at (800) 475-6701 with pass
code 466474.
The earnings release and related supplemental schedules
containing the reconciliations of non-GAAP measures will be
available on the Hertz website, IR.Hertz.com.
SELECTED FINANCIAL AND OPERATING DATA, SUPPLEMENTAL SCHEDULES
AND DEFINITIONS
Following are tables that present selected financial and
operating data of Hertz Global. Also included are Supplemental
Schedules, which are provided to present segment results, and
reconciliations of non-GAAP measures to their most comparable GAAP
measure. Following the Supplemental Schedules, the Company provides
definitions for terminology used throughout this earnings release
and provides the usefulness of non-GAAP measures to investors and
additional purposes for which management uses such measures.
ABOUT HERTZ
The Hertz Corporation, a subsidiary of Hertz Global Holdings,
Inc., operates the Hertz, Dollar and Thrifty vehicle rental brands
in approximately 10,200 company-owned, licensee and franchisee
locations throughout North
America, Europe, the
Caribbean, Latin America, Africa, the Middle
East, Asia, Australia and New
Zealand. The Hertz Corporation is one of the largest
worldwide vehicle rental companies, and the Hertz brand is one of
the most recognized globally. Product and service initiatives such
as Hertz Gold Plus Rewards, Ultimate Choice, Carfirmations, Mobile
Wi-Fi and unique vehicles offered through its specialty collections
set Hertz apart from the competition. Additionally, The Hertz
Corporation owns the vehicle leasing and fleet management leader
Donlen Corporation, operates the Firefly vehicle rental brand and
Hertz 24/7 car sharing business in international markets and sells
vehicles through Hertz Car Sales. For more information about The
Hertz Corporation, visit: www.hertz.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this release, and in related
comments by the Company's management, include "forward-looking
statements." Forward-looking statements include information
concerning the Company's liquidity and its possible or assumed
future results of operations, including descriptions of its
business strategies. These statements often include words such as
"believe," "expect," "project," "potential," "anticipate,"
"intend," "plan," "estimate," "seek," "will," "may," "would,"
"should," "could," "forecasts" or similar expressions. These
statements are based on certain assumptions that the Company has
made in light of its experience in the industry as well as its
perceptions of historical trends, current conditions, expected
future developments and other factors it believes are appropriate
in these circumstances. The Company believes these judgments are
reasonable, but you should understand that these statements are not
guarantees of performance or results, and the Company's actual
results could differ materially from those expressed in the
forward-looking statements due to a variety of important factors,
both positive and negative, that may be revised or supplemented in
subsequent reports on Forms 10-K, 10-Q and 8-K filed or furnished
to the Securities and Exchange Commission ("SEC"). Among other
items, such factors could include: levels of travel demand,
particularly with respect to airline passenger traffic in
the United States and in global
markets; the effect of the Company's separation of its vehicle and
equipment rental businesses, any failure by Herc Holdings Inc. to
comply with the agreements entered into in connection with the
separation and the Company's ability to obtain the expected
benefits of the separation; significant changes in the competitive
environment and the effect of competition in the Company's markets
on rental volume and pricing, including on the Company's pricing
policies or use of incentives; occurrences that disrupt rental
activity during the Company's peak periods; the Company's ability
to accurately estimate future levels of rental activity and adjust
the number and mix of vehicles used in its rental operations
accordingly; increased vehicle costs due to declines in the value
of the Company's non-program vehicles; the Company's ability to
maintain sufficient liquidity and the availability to it of
additional or continued sources of financing for its revenue
earning vehicles and to refinance its existing indebtedness; the
Company's ability to purchase adequate supplies of competitively
priced vehicles and risks relating to increases in the cost of the
vehicles it purchases; the Company's ability to adequately respond
to changes in technology and customer demands; the Company's
ability to retain customer loyalty and market share; the Company's
recognition of previously deferred tax gains on the disposition of
revenue earning vehicles; an increase in the Company's vehicle
costs or disruption to its rental activity, particularly during its
peak periods, due to safety recalls by the manufacturers of its
vehicles; the Company's access to third-party distribution
channels and related prices, commission structures and transaction
volumes; the Company's ability to execute a business continuity
plan; a major disruption in the Company's communication or
centralized information networks; a failure to maintain, upgrade
and consolidate the Company's information technology networks;
financial instability of the manufacturers of the Company's
vehicles; any impact on the Company from the actions of its
franchisees, dealers and independent contractors; the Company's
ability to sustain operations during adverse economic cycles and
unfavorable external events (including war, terrorist acts, natural
disasters and epidemic disease); shortages of fuel and increases or
volatility in fuel costs; the Company's ability to maintain
favorable brand recognition and a coordinated branding and
portfolio strategy; the Company's ability to maintain an effective
employee retention and talent management strategy and resulting
changes in personnel and employee relations; costs and risks
associated with litigation and investigations; risks related to the
Company's indebtedness, including its substantial amount of debt,
its ability to incur substantially more debt, the fact that
substantially all of its consolidated assets secure certain of its
outstanding indebtedness and increases in interest rates or in its
borrowing margins; the Company's ability to meet the financial and
other covenants contained in its senior credit facilities and
letter of credit facility, its outstanding unsecured senior notes,
its outstanding senior second priority secured notes and certain
asset-backed and asset-based arrangements; changes in accounting
principles, or their application or interpretation, and the
Company's ability to make accurate estimates and the assumptions
underlying the estimates, which could have an effect on operating
results; risks associated with operating in many different
countries, including the risk of a violation or alleged violation
of applicable anticorruption or antibribery laws and the Company's
ability to repatriate cash from non-U.S. affiliates without adverse
tax consequences; the Company's ability to prevent the misuse or
theft of information it possesses, including as a result of cyber
security breaches and other security threats; changes in the
existing, or the adoption of new laws, regulations, policies or
other activities of governments, agencies and similar
organizations, such as the adoption of new regulations under the
Tax Cuts and Jobs Act, where such actions may affect the Company's
operations, the cost thereof or applicable tax rates; risks
relating to the Company's deferred tax assets, including the risk
of an "ownership change" under the Internal Revenue Code of 1986,
as amended; the Company's exposure to uninsured claims in excess of
historical levels; fluctuations in interest rates and commodity
prices; the Company's exposure to fluctuations in foreign currency
exchange rates and other risks and uncertainties described from
time to time in periodic and current reports that the Company files
with the SEC.
Additional information concerning these and other factors can be
found in the Company's filings with the SEC, including its Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K.
You should not place undue reliance on forward-looking
statements. All forward-looking statements attributable to the
Company or persons acting on its behalf are expressly qualified in
their entirety by the foregoing cautionary statements. All such
statements speak only as of the date made, and the Company
undertakes no obligation to update or revise publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise.
FINANCIAL INFORMATION AND OPERATING DATA
|
SELECTED
UNAUDITED CONSOLIDATED INCOME STATEMENT DATA
|
|
|
Three Months
Ended
March 31,
|
|
As a Percentage of
Total
Revenues
|
|
(In millions, except
per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
Total
revenues
|
$
|
2,107
|
|
|
$
|
2,063
|
|
|
100
|
%
|
|
100
|
%
|
|
Expenses:
|
|
|
|
|
|
|
|
|
Direct vehicle and
operating
|
1,266
|
|
|
1,236
|
|
|
60
|
%
|
|
60
|
%
|
|
Depreciation of
revenue earning vehicles and lease charges
|
592
|
|
|
661
|
|
|
28
|
%
|
|
32
|
%
|
|
Selling, general and
administrative
|
234
|
|
|
234
|
|
|
11
|
%
|
|
11
|
%
|
|
Interest expense,
net:
|
|
|
|
|
|
|
|
|
Vehicle
|
112
|
|
|
94
|
|
|
5
|
%
|
|
5
|
%
|
|
Non-vehicle
|
71
|
|
|
72
|
|
|
3
|
%
|
|
3
|
%
|
|
Total interest
expense, net
|
183
|
|
|
166
|
|
|
9
|
%
|
|
8
|
%
|
|
Other (income)
expense, net
|
(19)
|
|
|
(3)
|
|
|
(1)
|
%
|
|
—
|
%
|
|
Total
expenses
|
2,256
|
|
|
2,294
|
|
|
107
|
%
|
|
111
|
%
|
|
Income (loss) before
income taxes
|
(149)
|
|
|
(231)
|
|
|
(7)
|
%
|
|
(11)
|
%
|
|
Income tax
(provision) benefit
|
1
|
|
|
29
|
|
|
—
|
%
|
|
1
|
%
|
|
Net income
(loss)
|
(148)
|
|
|
(202)
|
|
|
(7)
|
%
|
|
(10)
|
%
|
|
Net (income) loss
attributable to noncontrolling interests
|
1
|
|
|
—
|
|
|
—
|
%
|
|
—
|
%
|
|
Net income (loss)
attributable to Hertz Global
|
$
|
(147)
|
|
|
$
|
(202)
|
|
|
(7)
|
%
|
|
(10)
|
%
|
|
Weighted average
number of shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
84
|
|
|
83
|
|
|
|
|
|
|
Diluted
|
84
|
|
|
83
|
|
|
|
|
|
|
Earnings (loss) per
share:
|
|
|
|
|
|
|
|
|
Basic
|
$
|
(1.75)
|
|
|
$
|
(2.43)
|
|
|
|
|
|
|
Diluted
|
$
|
(1.75)
|
|
|
$
|
(2.43)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Pre-tax
Income (Loss)(a)
|
$
|
(111)
|
|
|
$
|
(175)
|
|
|
|
|
|
|
Adjusted Net Income
(Loss)(a)
|
$
|
(83)
|
|
|
$
|
(131)
|
|
|
|
|
|
|
Adjusted Diluted
Earnings (Loss) Per Share(a)
|
$
|
(0.99)
|
|
|
$
|
(1.58)
|
|
|
|
|
|
|
Adjusted Corporate
EBITDA(a)
|
$
|
(4)
|
|
|
$
|
(59)
|
|
|
|
|
|
|
(a)
|
Represents a non-GAAP
measure, see the accompanying reconciliations included in
Supplemental Schedule II.
|
|
SELECTED
UNAUDITED CONSOLIDATED BALANCE SHEET DATA
|
|
|
(In
millions)
|
As of March 31,
2019
|
|
As of December 31,
2018
|
|
Cash and cash
equivalents
|
$
|
554
|
|
|
$
|
1,127
|
|
|
Total restricted cash
and cash equivalents
|
452
|
|
|
283
|
|
|
Revenue earning
vehicles, net:
|
|
|
|
|
U.S. Rental
Car
|
9,871
|
|
|
8,793
|
|
|
International Rental
Car
|
2,330
|
|
|
2,146
|
|
|
All Other
Operations
|
1,567
|
|
|
1,480
|
|
|
Total revenue earning
vehicles, net
|
13,768
|
|
|
12,419
|
|
|
Total
assets(a)
|
24,030
|
|
|
21,382
|
|
|
Total debt
|
17,257
|
|
|
16,324
|
|
|
Net Vehicle
Debt(b)
|
12,442
|
|
|
11,684
|
|
|
Net Non-vehicle
Debt(b)
|
3,904
|
|
|
3,326
|
|
|
Total stockholders'
equity
|
1,005
|
|
|
1,120
|
|
|
(a)
|
On January 1, 2019,
the Company adopted new lease guidance under U.S. GAAP and recorded
a net cumulative-effect adjustment of $1.5 billion to
recognize assets associated with the Company's leases as of that
date.
|
|
|
|
(b)
|
Represents a non-GAAP
measure, see the accompanying reconciliations included in
Supplemental Schedule V.
|
|
SELECTED
UNAUDITED CONSOLIDATED CASH FLOW DATA
|
|
|
Three Months Ended
March 31,
|
|
(In
millions)
|
2019
|
|
2018
|
|
Cash flows provided
by (used in):
|
|
|
|
|
Operating
activities
|
$
|
514
|
|
|
$
|
401
|
|
|
Investing
activities
|
(1,855)
|
|
|
(1,850)
|
|
|
Financing
activities
|
939
|
|
|
1,877
|
|
|
Effect of exchange
rate changes
|
(2)
|
|
|
8
|
|
|
Net change in cash,
cash equivalents, restricted cash and restricted cash
equivalents
|
$
|
(404)
|
|
|
$
|
436
|
|
|
|
|
|
|
Fleet
Growth(a)
|
$
|
(413)
|
|
|
$
|
280
|
|
|
Adjusted Free Cash
Flow(a)
|
$
|
(578)
|
|
|
$
|
—
|
|
|
(a)
|
Represents a non-GAAP
measure, see the accompanying reconciliations included in
Supplemental Schedules III and IV.
|
|
SELECTED
UNAUDITED OPERATING DATA BY SEGMENT
|
|
|
Three Months
Ended
March 31,
|
|
Percent
Inc/(Dec)
|
|
|
2019
|
|
2018
|
|
|
|
U.S.
RAC
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
35,582
|
|
|
34,203
|
|
|
4
|
%
|
|
|
Total
RPD(a)
|
$
|
41.90
|
|
|
$
|
40.93
|
|
|
2
|
%
|
|
|
Total RPU Per
Month(a)
|
$
|
990
|
|
|
$
|
975
|
|
|
2
|
%
|
|
|
Average
Vehicles
|
501,767
|
|
|
478,600
|
|
|
5
|
%
|
|
|
Vehicle
Utilization(a)
|
79
|
%
|
|
79
|
%
|
|
(60)
|
|
bps
|
|
Depreciation Per Unit
Per Month(a)
|
$
|
256
|
|
|
$
|
302
|
|
|
(15)
|
%
|
|
|
Percentage of program
vehicles at period end
|
9
|
%
|
|
9
|
%
|
|
(90)
|
|
bps
|
|
Adjusted Pre-tax
Income (Loss) (in millions)(b)
|
$
|
25
|
|
|
$
|
(48)
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
International
RAC
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
10,127
|
|
|
9,974
|
|
|
2
|
%
|
|
|
Total
RPD(a)
|
$
|
42.56
|
|
|
$
|
43.41
|
|
|
(2)
|
%
|
|
|
Total RPU Per
Month(a)
|
$
|
941
|
|
|
$
|
971
|
|
|
(3)
|
%
|
|
|
Average
Vehicles
|
152,747
|
|
|
148,700
|
|
|
3
|
%
|
|
|
Vehicle
Utilization(a)
|
74
|
%
|
|
75
|
%
|
|
(90)
|
|
bps
|
|
Depreciation Per Unit
Per Month(a)
|
$
|
212
|
|
|
$
|
211
|
|
|
—
|
%
|
|
|
Percentage of program
vehicles at period end
|
39
|
%
|
|
41
|
%
|
|
(250)
|
|
bps
|
|
Adjusted Pre-tax
Income (Loss) (in millions)(b)
|
$
|
(18)
|
|
|
$
|
(6)
|
|
|
200
|
%
|
|
|
|
|
|
|
|
|
|
All Other
Operations
|
|
|
|
|
|
|
|
Average Vehicles —
Donlen
|
192,799
|
|
|
191,600
|
|
|
1
|
%
|
|
|
Adjusted Pre-tax
Income (Loss) (in millions)(b)
|
$
|
25
|
|
|
$
|
22
|
|
|
14
|
%
|
|
|
NM - Not
meaningful
|
|
(a)
|
See the accompanying
calculations of this key metric in Supplemental Schedule
VI.
|
|
|
|
(b)
|
Represents a non-GAAP
measure, see the accompanying reconciliations included in
Supplemental Schedule II.
|
|
Supplemental
Schedule I
|
|
Supplemental
Schedule I
HERTZ GLOBAL
HOLDINGS, INC.
CONDENSED
STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
|
|
|
Three Months Ended
March 31, 2019
|
|
Three Months Ended
March 31, 2018
|
|
(In
millions)
|
U.S. Rental
Car
|
|
Int'l Rental
Car
|
|
All Other
Operations
|
|
Corporate
|
|
Hertz
Global
|
|
U.S. Rental
Car
|
|
Int'l Rental
Car
|
|
All Other
Operations
|
|
Corporate
|
|
Hertz
Global
|
|
Total
revenues:
|
$
|
1,520
|
|
|
$
|
433
|
|
|
$
|
154
|
|
|
$
|
—
|
|
|
$
|
2,107
|
|
|
$
|
1,426
|
|
|
$
|
468
|
|
|
$
|
169
|
|
|
$
|
—
|
|
|
$
|
2,063
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct vehicle and
operating
|
976
|
|
|
284
|
|
|
6
|
|
|
—
|
|
|
1,266
|
|
|
927
|
|
|
300
|
|
|
9
|
|
|
—
|
|
|
1,236
|
|
|
Depreciation of
revenue earning vehicles and lease
charges
|
386
|
|
|
97
|
|
|
109
|
|
|
—
|
|
|
592
|
|
|
434
|
|
|
102
|
|
|
125
|
|
|
—
|
|
|
661
|
|
|
Selling, general and
administrative
|
121
|
|
|
54
|
|
|
7
|
|
|
52
|
|
|
234
|
|
|
99
|
|
|
60
|
|
|
10
|
|
|
65
|
|
|
234
|
|
|
Interest expense,
net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle
|
77
|
|
|
23
|
|
|
12
|
|
|
—
|
|
|
112
|
|
|
65
|
|
|
20
|
|
|
9
|
|
|
—
|
|
|
94
|
|
|
Non-vehicle
|
(45)
|
|
|
(1)
|
|
|
(4)
|
|
|
121
|
|
|
71
|
|
|
(31)
|
|
|
(1)
|
|
|
(3)
|
|
|
107
|
|
|
72
|
|
|
Total interest
expense, net
|
32
|
|
|
22
|
|
|
8
|
|
|
121
|
|
|
183
|
|
|
34
|
|
|
19
|
|
|
6
|
|
|
107
|
|
|
166
|
|
|
Other (income)
expense, net
|
(9)
|
|
|
—
|
|
|
—
|
|
|
(10)
|
|
|
(19)
|
|
|
—
|
|
|
(1)
|
|
|
—
|
|
|
(2)
|
|
|
(3)
|
|
|
Total
expenses
|
1,506
|
|
|
457
|
|
|
130
|
|
|
163
|
|
|
2,256
|
|
|
1,494
|
|
|
480
|
|
|
150
|
|
|
170
|
|
|
2,294
|
|
|
Income (loss) before
income taxes
|
$
|
14
|
|
|
$
|
(24)
|
|
|
$
|
24
|
|
|
$
|
(163)
|
|
|
$
|
(149)
|
|
|
$
|
(68)
|
|
|
$
|
(12)
|
|
|
$
|
19
|
|
|
$
|
(170)
|
|
|
$
|
(231)
|
|
|
Income tax
(provision) benefit
|
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
29
|
|
|
Net income
(loss)
|
|
|
|
|
|
|
|
|
$
|
(148)
|
|
|
|
|
|
|
|
|
|
|
$
|
(202)
|
|
|
Net (income) loss
attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
Net income (loss)
attributable to Hertz Global
|
|
|
|
|
|
|
|
|
$
|
(147)
|
|
|
|
|
|
|
|
|
|
|
$
|
(202)
|
|
|
Supplemental
Schedule II
|
|
Supplemental
Schedule II
HERTZ GLOBAL
HOLDINGS, INC.
RECONCILIATION OF
NET INCOME (LOSS) TO GROSS EBITDA, CORPORATE EBITDA, ADJUSTED
CORPORATE EBITDA,
ADJUSTED PRE-TAX
INCOME (LOSS), ADJUSTED NET INCOME (LOSS) AND ADJUSTED DILUTED
EARNINGS (LOSS) PER SHARE
Unaudited
|
|
|
Three Months Ended
March 31, 2019
|
|
Three Months Ended
March 31, 2018
|
|
(In millions, except
per share data)
|
U.S. Rental
Car
|
|
Int'l Rental
Car
|
|
All Other
Operations
|
|
Corporate
|
|
Hertz
Global
|
|
U.S. Rental
Car
|
|
Int'l Rental
Car
|
|
All Other
Operations
|
|
Corporate
|
|
Hertz
Global
|
|
Net income
(loss)
|
|
|
|
|
|
|
|
|
$
|
(148)
|
|
|
|
|
|
|
|
|
|
|
$
|
(202)
|
|
|
Income tax provision
(benefit)
|
|
|
|
|
|
|
|
|
(1)
|
|
|
|
|
|
|
|
|
|
|
(29)
|
|
|
Income (loss) before
income taxes
|
$
|
14
|
|
|
$
|
(24)
|
|
|
$
|
24
|
|
|
$
|
(163)
|
|
|
$
|
(149)
|
|
|
$
|
(68)
|
|
|
$
|
(12)
|
|
|
$
|
19
|
|
|
$
|
(170)
|
|
|
$
|
(231)
|
|
|
Depreciation and
amortization
|
424
|
|
|
103
|
|
|
111
|
|
|
3
|
|
|
641
|
|
|
477
|
|
|
110
|
|
|
128
|
|
|
4
|
|
|
719
|
|
|
Interest, net of
interest income
|
32
|
|
|
22
|
|
|
8
|
|
|
121
|
|
|
183
|
|
|
34
|
|
|
19
|
|
|
6
|
|
|
107
|
|
|
166
|
|
|
Gross
EBITDA
|
$
|
470
|
|
|
$
|
101
|
|
|
$
|
143
|
|
|
$
|
(39)
|
|
|
$
|
675
|
|
|
$
|
443
|
|
|
$
|
117
|
|
|
$
|
153
|
|
|
$
|
(59)
|
|
|
$
|
654
|
|
|
Revenue earning
vehicle depreciation and lease charges
|
(386)
|
|
|
(97)
|
|
|
(109)
|
|
|
—
|
|
|
(592)
|
|
|
(434)
|
|
|
(102)
|
|
|
(125)
|
|
|
—
|
|
|
(661)
|
|
|
Vehicle debt
interest
|
(77)
|
|
|
(23)
|
|
|
(12)
|
|
|
—
|
|
|
(112)
|
|
|
(65)
|
|
|
(20)
|
|
|
(9)
|
|
|
—
|
|
|
(94)
|
|
|
Vehicle debt-related
charges(a)
|
5
|
|
|
3
|
|
|
2
|
|
|
—
|
|
|
10
|
|
|
9
|
|
|
2
|
|
|
1
|
|
|
—
|
|
|
12
|
|
|
Corporate
EBITDA
|
$
|
12
|
|
|
$
|
(16)
|
|
|
$
|
24
|
|
|
$
|
(39)
|
|
|
$
|
(19)
|
|
|
$
|
(47)
|
|
|
$
|
(3)
|
|
|
$
|
20
|
|
|
$
|
(59)
|
|
|
$
|
(89)
|
|
|
Non-cash stock-based
compensation charges(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
|
Restructuring and
restructuring related charges(c)
|
3
|
|
|
—
|
|
|
1
|
|
|
3
|
|
|
7
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
4
|
|
|
Information
technology and finance transformation
costs(d)
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|
23
|
|
|
Other
items(e)
|
(8)
|
|
|
3
|
|
|
(3)
|
|
|
(10)
|
|
|
(18)
|
|
|
(1)
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Adjusted Corporate
EBITDA
|
$
|
7
|
|
|
$
|
(13)
|
|
|
$
|
22
|
|
|
$
|
(20)
|
|
|
$
|
(4)
|
|
|
$
|
(48)
|
|
|
$
|
—
|
|
|
$
|
20
|
|
|
$
|
(31)
|
|
|
$
|
(59)
|
|
|
Non-vehicle
depreciation and amortization
|
(38)
|
|
|
(6)
|
|
|
(2)
|
|
|
(3)
|
|
|
(49)
|
|
|
(43)
|
|
|
(8)
|
|
|
(3)
|
|
|
(4)
|
|
|
(58)
|
|
|
Non-vehicle debt
interest, net of interest income
|
45
|
|
|
1
|
|
|
4
|
|
|
(121)
|
|
|
(71)
|
|
|
31
|
|
|
1
|
|
|
3
|
|
|
(107)
|
|
|
(72)
|
|
|
Non-vehicle
debt-related charges(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|
Non-cash stock-based
compensation charges(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
(3)
|
|
|
(3)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3)
|
|
|
(3)
|
|
|
Acquisition
accounting(f)
|
12
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
14
|
|
|
12
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
15
|
|
|
Other(g)
|
(1)
|
|
|
—
|
|
|
—
|
|
|
(1)
|
|
|
(2)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2)
|
|
|
(2)
|
|
|
Adjusted Pre-tax
Income (Loss)(h)
|
$
|
25
|
|
|
$
|
(18)
|
|
|
$
|
25
|
|
|
$
|
(143)
|
|
|
$
|
(111)
|
|
|
$
|
(48)
|
|
|
$
|
(6)
|
|
|
$
|
22
|
|
|
$
|
(143)
|
|
|
$
|
(175)
|
|
|
Income tax
(provision) benefit on Adjusted Pre-tax Income
(Loss)(i)
|
|
|
|
|
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
44
|
|
|
Adjusted Net Income
(Loss)
|
|
|
|
|
|
|
|
|
$
|
(83)
|
|
|
|
|
|
|
|
|
|
|
$
|
(131)
|
|
|
Weighted average
number of diluted shares outstanding
|
|
|
|
|
|
|
|
|
84
|
|
|
|
|
|
|
|
|
|
|
83
|
|
|
Adjusted Diluted
Earnings (Loss) Per Share
|
|
|
|
|
|
|
|
|
$
|
(0.99)
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.58)
|
|
|
Supplemental
Schedule II (continued)
|
|
|
|
(a)
|
Represents
debt-related charges relating to the amortization of deferred
financing costs and debt discounts and premiums
|
|
|
|
(b)
|
Stock-based
compensation expense is an adjustment for purposes of calculating
Adjusted Corporate EBITDA but not for calculating Adjusted Pre-tax
Income (Loss).
|
|
|
|
(c)
|
Represents charges
incurred under restructuring actions as defined in U.S. GAAP
excluding impairments and asset write-downs. Also includes
restructuring related charges such as incremental costs incurred
directly supporting business transformation initiatives. Such costs
include transition costs incurred in connection with business
process outsourcing arrangements and incremental costs incurred to
facilitate business process re-engineering initiatives that involve
significant organization redesign and extensive operational process
changes. In 2018, also includes consulting costs, legal fees, and
other expenses related to the previously disclosed accounting
review and investigation.
|
|
|
|
(d)
|
Represents costs
associated with the Company's information technology and finance
transformation programs, both of which are multi-year initiatives
to upgrade and modernize the Company's systems and
processes.
|
|
|
|
(e)
|
Represents
miscellaneous or non-recurring items, and includes amounts
attributable to noncontrolling interests. In 2019, also includes an
$11 million gain on marketable securities, and an $8 million gain
on the sale of non-vehicle capital assets.
|
|
|
|
(f)
|
Represents
incremental expense associated with amortization of other
intangible assets and depreciation of property and equipment
relating to acquisition accounting.
|
|
|
|
(g)
|
Comprised of items,
other than non-cash stock-based compensation charges, that are
adjustments for purposes of calculating Adjusted Corporate EBITDA
but not for calculating Adjusted Pre-tax Income (Loss).
|
|
|
|
(h)
|
Adjustments by
caption to arrive at Adjusted Pre-tax Income (Loss) are as
follows:
|
|
Increase
(decrease) to expenses
|
Three Months
Ended
March 31,
|
|
(In
millions)
|
2019
|
|
2018
|
|
Direct vehicle and
operating
|
$
|
(13)
|
|
|
$
|
(16)
|
|
|
Selling, general and
administrative
|
(29)
|
|
|
(25)
|
|
|
Interest expense,
net:
|
|
|
|
|
Vehicle
|
(10)
|
|
|
(12)
|
|
|
Non-vehicle
|
(4)
|
|
|
(4)
|
|
|
Total interest
expense, net
|
(14)
|
|
|
(16)
|
|
|
Other income
(expense), net
|
19
|
|
|
1
|
|
|
Noncontrolling
interests
|
(1)
|
|
|
—
|
|
|
Total
adjustments
|
$
|
(38)
|
|
|
$
|
(56)
|
|
|
(i)
|
Derived utilizing a
combined statutory rate of 25% and 25% for the periods ending
March 31, 2019 and 2018, respectively, applied to the
respective Adjusted Pre-tax Income (Loss).
|
|
Supplemental
Schedule III
|
|
HERTZ GLOBAL
HOLDINGS, INC.
RECONCILIATION OF
GAAP TO NON-GAAP MEASURE - FLEET GROWTH
Unaudited
|
|
|
Three Months Ended
March 31, 2019
|
|
Three Months Ended
March 31, 2018
|
|
(In
millions)
|
U.S. Rental
Car
|
|
Int'l Rental
Car
|
|
All Other
Operations
|
|
Hertz
Global
|
|
U.S. Rental
Car
|
|
Int'l Rental
Car
|
|
All Other
Operations
|
|
Hertz
Global
|
|
Revenue earning
vehicles expenditures
|
$
|
(3,078)
|
|
|
$
|
(631)
|
|
|
$
|
(264)
|
|
|
$
|
(3,973)
|
|
|
$
|
(2,892)
|
|
|
$
|
(487)
|
|
|
$
|
(186)
|
|
|
$
|
(3,565)
|
|
|
Proceeds from
disposal of revenue earning vehicles
|
1,382
|
|
|
689
|
|
|
82
|
|
|
2,153
|
|
|
1,102
|
|
|
636
|
|
|
44
|
|
|
1,782
|
|
|
Net revenue earning
vehicles capital expenditures
|
(1,696)
|
|
|
58
|
|
|
(182)
|
|
|
(1,820)
|
|
|
(1,790)
|
|
|
149
|
|
|
(142)
|
|
|
(1,783)
|
|
|
Depreciation and
reserves for revenue earning vehicles
|
451
|
|
|
84
|
|
|
109
|
|
|
644
|
|
|
434
|
|
|
82
|
|
|
125
|
|
|
641
|
|
|
Financing activity
related to vehicles:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings
|
2,925
|
|
|
580
|
|
|
162
|
|
|
3,667
|
|
|
3,898
|
|
|
1,189
|
|
|
94
|
|
|
5,181
|
|
|
Payments
|
(2,061)
|
|
|
(562)
|
|
|
(113)
|
|
|
(2,736)
|
|
|
(2,529)
|
|
|
(687)
|
|
|
(67)
|
|
|
(3,283)
|
|
|
Restricted cash
changes
|
(51)
|
|
|
(123)
|
|
|
6
|
|
|
(168)
|
|
|
36
|
|
|
(500)
|
|
|
(12)
|
|
|
(476)
|
|
|
Net financing activity
related to vehicles
|
813
|
|
|
(105)
|
|
|
55
|
|
|
763
|
|
|
1,405
|
|
|
2
|
|
|
15
|
|
|
1,422
|
|
|
Fleet
Growth
|
$
|
(432)
|
|
|
$
|
37
|
|
|
$
|
(18)
|
|
|
$
|
(413)
|
|
|
$
|
49
|
|
|
$
|
233
|
|
|
$
|
(2)
|
|
|
$
|
280
|
|
|
Supplemental
Schedule IV
|
|
HERTZ GLOBAL
HOLDINGS, INC.
RECONCILIATION OF
GAAP TO NON-GAAP MEASURE - ADJUSTED FREE CASH FLOW
Unaudited
|
|
|
Three Months
Ended
March 31,
|
|
(In
millions)
|
2019
|
|
2018
|
|
Net cash provided by
operating activities
|
$
|
514
|
|
|
$
|
401
|
|
|
Net change in
restricted cash and cash equivalents, vehicle
|
(168)
|
|
|
(476)
|
|
|
Revenue earning
vehicles expenditures
|
(3,973)
|
|
|
(3,565)
|
|
|
Proceeds from
disposal of revenue earning vehicles
|
2,153
|
|
|
1,782
|
|
|
Capital asset
expenditures, non-vehicle
|
(54)
|
|
|
(44)
|
|
|
Proceeds from
property and other equipment disposed of or to be disposed
of
|
19
|
|
|
4
|
|
|
Proceeds from
issuance of vehicle debt
|
3,667
|
|
|
5,181
|
|
|
Repayments of vehicle
debt
|
(2,736)
|
|
|
(3,283)
|
|
|
Adjusted Free Cash
Flow
|
$
|
(578)
|
|
|
$
|
—
|
|
|
Supplemental
Schedule V
|
|
HERTZ GLOBAL
HOLDINGS, INC.
RECONCILIATION OF
GAAP TO NON-GAAP MEASURE - NET DEBT
Unaudited
|
|
|
As of March 31,
2019
|
|
As of December 31,
2018
|
|
(In
millions)
|
Vehicle
|
|
Non-
Vehicle
|
|
Total
|
|
Vehicle
|
|
Non-
Vehicle
|
|
Total
|
|
Debt as reported in
the balance sheet
|
$
|
12,827
|
|
|
$
|
4,430
|
|
|
$
|
17,257
|
|
|
$
|
11,902
|
|
|
$
|
4,422
|
|
|
$
|
16,324
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt issue costs deducted
from debt obligations
|
40
|
|
|
28
|
|
|
68
|
|
|
39
|
|
|
31
|
|
|
70
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
—
|
|
|
554
|
|
|
554
|
|
|
—
|
|
|
1,127
|
|
|
1,127
|
|
|
Restricted
cash
|
425
|
|
|
—
|
|
|
425
|
|
|
257
|
|
|
—
|
|
|
257
|
|
|
Net Debt
|
$
|
12,442
|
|
|
$
|
3,904
|
|
|
$
|
16,346
|
|
|
$
|
11,684
|
|
|
$
|
3,326
|
|
|
$
|
15,010
|
|
|
Supplemental
Schedule VI
|
|
HERTZ GLOBAL
HOLDINGS, INC.
RECONCILIATIONS OF
KEY METRICS
REVENUE,
UTILIZATION AND DEPRECIATION
Unaudited
|
|
|
U.S. Rental
Car
|
|
|
Three Months
Ended
March 31,
|
|
Percent
Inc/(Dec)
|
|
|
($ in millions,
except where noted)
|
2019
|
|
2018
|
|
|
|
Total
RPD
|
|
|
|
|
|
|
|
Revenues
|
$
|
1,520
|
|
|
$
|
1,426
|
|
|
|
|
|
Ancillary retail
vehicle sales revenue
|
(29)
|
|
|
(26)
|
|
|
|
|
|
Total Rental
Revenue
|
$
|
1,491
|
|
|
$
|
1,400
|
|
|
|
|
|
Transaction Days (in
thousands)
|
35,582
|
|
|
34,203
|
|
|
|
|
|
Total RPD (in whole
dollars)
|
$
|
41.90
|
|
|
$
|
40.93
|
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
Total Revenue Per
Unit Per Month
|
|
|
|
|
|
|
|
Total Rental
Revenue
|
$
|
1,491
|
|
|
$
|
1,400
|
|
|
|
|
|
Average
Vehicles
|
501,767
|
|
|
478,600
|
|
|
|
|
|
Total revenue per
unit (in whole dollars)
|
$
|
2,971
|
|
|
$
|
2,925
|
|
|
|
|
|
Number of months in
period
|
3
|
|
|
3
|
|
|
|
|
|
Total RPU Per Month
(in whole dollars)
|
$
|
990
|
|
|
$
|
975
|
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
Vehicle
Utilization
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
35,582
|
|
|
34,203
|
|
|
|
|
|
Average
Vehicles
|
501,767
|
|
|
478,600
|
|
|
|
|
|
Number of days in
period
|
90
|
|
|
90
|
|
|
|
|
|
Available Car Days
(in thousands)
|
45,159
|
|
|
43,074
|
|
|
|
|
|
Vehicle
Utilization(a)
|
79
|
%
|
|
79
|
%
|
|
(60)
|
|
bps
|
|
|
|
|
|
|
|
|
Depreciation Per
Unit Per Month
|
|
|
|
|
|
|
|
Depreciation of
revenue earning vehicles and lease charges
|
$
|
386
|
|
|
$
|
434
|
|
|
|
|
|
Average
Vehicles
|
501,767
|
|
|
478,600
|
|
|
|
|
|
Depreciation of
revenue earning vehicles and lease charges divided by Average
Vehicles (in whole dollars)
|
$
|
769
|
|
|
$
|
907
|
|
|
|
|
|
Number of months in
period
|
3
|
|
|
3
|
|
|
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
|
256
|
|
|
$
|
302
|
|
|
(15)
|
%
|
|
|
(a)
|
Calculated as
Transaction Days divided by Available Car Days.
|
|
Supplemental
Schedule VI (continued)
|
|
HERTZ GLOBAL
HOLDINGS, INC.
RECONCILIATIONS OF
KEY METRICS
REVENUE,
UTILIZATION AND DEPRECIATION
Unaudited
|
|
|
International
Rental Car
|
|
|
Three Months
Ended
March 31,
|
|
Percent
Inc/(Dec)
|
|
|
($ in millions,
except where noted)
|
2019
|
|
2018
|
|
|
|
Total
RPD
|
|
|
|
|
|
|
|
Revenues
|
$
|
433
|
|
|
$
|
468
|
|
|
|
|
|
Foreign currency
adjustment(a)
|
(2)
|
|
|
(35)
|
|
|
|
|
|
Total Rental
Revenue
|
$
|
431
|
|
|
$
|
433
|
|
|
|
|
|
Transaction Days (in
thousands)
|
10,127
|
|
|
9,974
|
|
|
|
|
|
Total RPD (in whole
dollars)
|
$
|
42.56
|
|
|
$
|
43.41
|
|
|
(2)
|
%
|
|
|
|
|
|
|
|
|
|
Total Revenue Per
Unit Per Month
|
|
|
|
|
|
|
|
Total Rental
Revenue
|
$
|
431
|
|
|
$
|
433
|
|
|
|
|
|
Average
Vehicles
|
152,747
|
|
|
148,700
|
|
|
|
|
|
Total revenue per
unit (in whole dollars)
|
$
|
2,822
|
|
|
$
|
2,912
|
|
|
|
|
|
Number of months in
period
|
3
|
|
|
3
|
|
|
|
|
|
Total RPU Per Month
(in whole dollars)
|
$
|
941
|
|
|
$
|
971
|
|
|
(3)
|
%
|
|
|
|
|
|
|
|
|
|
Vehicle
Utilization
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
10,127
|
|
|
9,974
|
|
|
|
|
|
Average
Vehicles
|
152,747
|
|
|
148,700
|
|
|
|
|
|
Number of days in
period
|
90
|
|
|
90
|
|
|
|
|
|
Available Car Days
(in thousands)
|
13,747
|
|
|
13,383
|
|
|
|
|
|
Vehicle
Utilization(b)
|
74
|
%
|
|
75
|
%
|
|
(90)
|
|
bps
|
|
|
|
|
|
|
|
|
Depreciation Per
Unit Per Month
|
|
|
|
|
|
|
|
Depreciation of
revenue earning vehicles and lease charges
|
$
|
97
|
|
|
$
|
102
|
|
|
|
|
|
Foreign currency
adjustment(a)
|
—
|
|
|
(8)
|
|
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and lease charges
|
$
|
97
|
|
|
$
|
94
|
|
|
|
|
|
Average
Vehicles
|
152,747
|
|
|
148,700
|
|
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and lease charges divided by
Average Vehicles (in whole dollars)
|
$
|
635
|
|
|
$
|
632
|
|
|
|
|
|
Number of months in
period
|
3
|
|
|
3
|
|
|
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
|
212
|
|
|
$
|
211
|
|
|
—
|
%
|
|
|
(a)
|
Based on
December 31, 2018 foreign exchange rates.
|
|
|
|
(b)
|
Calculated as
Transaction Days divided by Available Car Days.
|
|
Supplemental
Schedule VI (continued)
|
|
HERTZ GLOBAL
HOLDINGS, INC.
RECONCILIATIONS OF
KEY METRICS
REVENUE,
UTILIZATION AND DEPRECIATION
Unaudited
|
|
|
Worldwide Rental
Car
|
|
|
Three Months
Ended
March 31,
|
|
Percent
Inc/(Dec)
|
|
|
($ in millions,
except where noted)
|
2019
|
|
2018
|
|
|
|
Total
RPD
|
|
|
|
|
|
|
|
Revenues
|
$
|
1,953
|
|
|
$
|
1,894
|
|
|
|
|
|
Ancillary retail
vehicle sales revenue
|
(29)
|
|
|
(26)
|
|
|
|
|
|
Foreign currency
adjustment(a)
|
(2)
|
|
|
(35)
|
|
|
|
|
|
Total Rental
Revenue
|
$
|
1,922
|
|
|
$
|
1,833
|
|
|
|
|
|
Transaction Days (in
thousands)
|
45,709
|
|
|
44,177
|
|
|
|
|
|
Total RPD (in whole
dollars)
|
$
|
42.05
|
|
|
$
|
41.49
|
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
Total Revenue Per
Unit Per Month
|
|
|
|
|
|
|
|
Total Rental
Revenue
|
$
|
1,922
|
|
|
$
|
1,833
|
|
|
|
|
|
Average
Vehicles
|
654,514
|
|
|
627,300
|
|
|
|
|
|
Total revenue per
unit (in whole dollars)
|
$
|
2,937
|
|
|
$
|
2,922
|
|
|
|
|
|
Number of months in
period
|
3
|
|
|
3
|
|
|
|
|
|
Total RPU Per Month
(in whole dollars)
|
$
|
979
|
|
|
$
|
974
|
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
Vehicle
Utilization
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
45,709
|
|
|
44,177
|
|
|
|
|
|
Average
Vehicles
|
654,514
|
|
|
627,300
|
|
|
|
|
|
Number of days in
period
|
90
|
|
|
90
|
|
|
|
|
|
Available Car Days
(in thousands)
|
58,906
|
|
|
56,457
|
|
|
|
|
|
Vehicle
Utilization(b)
|
78
|
%
|
|
78
|
%
|
|
(70)
|
|
bps
|
|
|
|
|
|
|
|
|
Depreciation Per
Unit Per Month
|
|
|
|
|
|
|
|
Depreciation of
revenue earning vehicles and lease charges
|
$
|
483
|
|
|
$
|
536
|
|
|
|
|
|
Foreign currency
adjustment(a)
|
—
|
|
|
(8)
|
|
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and lease charges
|
$
|
483
|
|
|
$
|
528
|
|
|
|
|
|
Average
Vehicles
|
654,514
|
|
|
627,300
|
|
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and lease charges divided by
Average Vehicles (in whole dollars)
|
$
|
738
|
|
|
$
|
842
|
|
|
|
|
|
Number of months in
period
|
3
|
|
|
3
|
|
|
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
|
246
|
|
|
$
|
281
|
|
|
(12)
|
%
|
|
|
Note: Worldwide
Rental Car represents U.S. Rental Car and International Rental Car
segment information on a combined basis and excludes the All Other
Operations segment, which is primarily comprised of the Company's
Donlen leasing operations, and Corporate.
|
|
|
(a)
Based on December 31, 2018 foreign exchange rates.
|
|
|
(b)
Calculated as Transaction Days divided by Available Car
Days.
|
NON-GAAP MEASURES AND KEY METRICS - DEFINITIONS AND
USE
Hertz Global is the top-level holding company and The Hertz
Corporation is Hertz Global's primary operating company (together,
the "Company"). The term "GAAP" refers to accounting principles
generally accepted in the United States
of America.
Definitions of non-GAAP measures and key metrics are set forth
below. Also set forth below is a summary of the reasons why
management of the Company believes that the presentation of the
non-GAAP financial measures included in the earnings release
provide useful information regarding the Company's financial
condition and results of operations and additional purposes for
which management of the Company utilizes the non-GAAP measures.
Non-GAAP measures should not be considered in isolation and should
not be considered superior to, or a substitute for, financial
measures calculated in accordance with GAAP.
NON-GAAP MEASURES
Adjusted Pre-tax Income (Loss) and Adjusted Pre-tax
Margin
Adjusted Pre-tax Income (Loss) is calculated as income (loss)
before income taxes plus non-cash acquisition accounting charges,
debt-related charges relating to the amortization and write-off of
debt financing costs and debt discounts and premiums, goodwill,
intangible and tangible asset impairments and write-downs,
information technology and finance transformation costs, net income
or loss attributable to noncontrolling interests and certain other
miscellaneous or non-recurring items. Adjusted Pre-tax Income
(Loss) is important to management because it allows management to
assess operational performance of the Company's business, exclusive
of the items mentioned above. It also allows management to assess
the performance of the entire business on the same basis as the
segment measure of profitability. Management believes it is
important to investors for the same reasons it is important to
management and because it allows them to assess the operational
performance of the Company on the same basis that management uses
internally. When evaluating the Company's operating performance,
investors should not consider Adjusted Pre-tax Income (Loss) in
isolation of, or as a substitute for, measures of the Company's
financial performance, such as net income (loss) or income (loss)
before income taxes. Adjusted Pre-tax Margin is Adjusted Pre-tax
Income (Loss) divided by total revenues.
Adjusted Net Income (Loss)
Adjusted Net Income (Loss) is calculated as Adjusted Pre-tax
Income (Loss) less a provision for income taxes derived utilizing a
combined statutory rate. The combined statutory rate is
management's estimate of the Company's long-term tax rate. Adjusted
Net Income (Loss) is important to management and investors because
it represents the Company's operational performance exclusive of
the effects of purchase accounting, debt-related charges, net
income or loss attributable to noncontrolling interests and certain
other miscellaneous or non-recurring items that are not operational
in nature or comparable to those of the Company's competitors.
Adjusted Diluted Earnings (Loss) Per Share ("Adjusted
Diluted EPS")
Adjusted Diluted EPS is calculated as Adjusted Net Income (Loss)
divided by the weighted average number of diluted shares
outstanding for the period. Adjusted Diluted EPS is important
to management and investors because it represents a measure of the
Company's operational performance exclusive of the effects of
purchase accounting adjustments, debt-related charges, income or
loss attributable to noncontrolling interests and certain other
miscellaneous or non-recurring items that are not operational in
nature or comparable to those of the Company's competitors.
Adjusted Free Cash Flow
Adjusted Free Cash Flow is calculated as net cash provided by
operating activities, including the change in restricted cash and
cash equivalents related to vehicles, net revenue earning vehicle
and capital asset expenditures and the net impact of vehicle
financing activities. Adjusted Free Cash Flow is important to
management and investors as it provides useful information about
the amount of cash available for acquisitions and the reduction of
non-vehicle debt. When evaluating the Company's liquidity,
investors should not consider Adjusted Free Cash Flow in isolation
of, or as a substitute for, a measure of the Company's liquidity as
determined in accordance with GAAP, such as net cash provided by
operating activities.
Earnings Before Interest, Taxes, Depreciation and
Amortization ("Gross EBITDA"), Corporate EBITDA, Adjusted Corporate
EBITDA and Adjusted Corporate EBITDA Margin
Gross EBITDA is defined as net income (loss) before net interest
expense, income taxes and depreciation (which includes lease
charges on revenue earning vehicles) and amortization. Corporate
EBITDA, as presented herein, represents Gross EBITDA as adjusted
for vehicle debt interest, vehicle depreciation and vehicle
debt-related charges. Adjusted Corporate EBITDA, as presented
herein, represents Corporate EBITDA as adjusted for income or loss
attributable to noncontrolling interests and certain other
miscellaneous or non-recurring items, as described in more detail
in the accompanying schedules.
Management uses Gross EBITDA, Corporate EBITDA and Adjusted
Corporate EBITDA as operating performance metrics for internal
monitoring and planning purposes, including the preparation of the
Company's annual operating budget and monthly operating reviews, as
well as to facilitate analysis of investment decisions,
profitability and performance trends. Further, Gross EBITDA enables
management and investors to isolate the effects on profitability of
operating metrics such as revenue, direct vehicle and operating
expenses and selling, general and administrative expenses, which
enables management and investors to evaluate the Company's business
segments that are financed differently and have different
depreciation characteristics and compare the Company's performance
against companies with different capital structures and
depreciation policies. We also present Adjusted Corporate EBITDA as
a supplemental measure because such information is utilized in the
determination of certain executive compensation.
Adjusted Corporate EBITDA Margin is calculated as the ratio of
Adjusted Corporate EBITDA to total revenues and is used by the
Company's management as an additional measurement of operating
profitability and operating performance trends.
Gross EBITDA, Corporate EBITDA, Adjusted Corporate EBITDA and
Adjusted Corporate EBITDA Margin are not recognized measurements
under GAAP. When evaluating the Company's operating performance,
investors should not consider Gross EBITDA, Corporate EBITDA and
Adjusted Corporate EBITDA in isolation of, or as a substitute for,
measures of the Company's financial performance as determined in
accordance with GAAP, such as net income (loss) or income (loss)
before income taxes.
Fleet Growth
Fleet Growth is defined as revenue earning vehicles
expenditures, net of proceeds from disposals, plus vehicle
depreciation and net vehicle financing which includes borrowings,
repayments and the change in restricted cash associated with
vehicles. Fleet Growth is important as it allows the Company to
assess the cash flow required to support its investment in revenue
earning vehicles.
Net Non-vehicle Debt
Net Non-vehicle Debt is calculated as non-vehicle debt as
reported on the Company's balance sheet, excluding the impact of
unamortized debt issue costs associated with non-vehicle debt, less
cash and cash equivalents. Non-vehicle debt consists of the
Company's Senior Term Loan, Senior RCF, Senior Notes, Senior Second
Priority Secured Notes, Promissory Notes and certain other
non-vehicle indebtedness of its domestic and foreign subsidiaries.
Net Non-vehicle Debt is important to management and investors as it
helps measure the Company's corporate leverage. Net Non-vehicle
Debt also assists in the evaluation of the Company's ability to
service its non-vehicle debt without reference to the expense
associated with the vehicle debt, which is collateralized by assets
not available to lenders under the non-vehicle debt facilities.
Net Vehicle Debt
Net Vehicle Debt is calculated as vehicle debt as reported on
the Company's balance sheet, excluding the impact of unamortized
debt issue costs associated with vehicle debt, less restricted cash
associated with vehicles. Restricted cash associated with vehicle
debt is restricted for the purchase of revenue earning vehicles and
other specified uses under the Company's vehicle debt facilities
and its vehicle rental like-kind exchange program. Net Vehicle Debt
is important to management, investors and ratings agencies as it
helps measure the Company's leverage with respect to its vehicle
assets.
Total Net Debt
Total Net Debt is calculated as total debt, excluding the impact
of unamortized debt issue costs, less total cash and cash
equivalents and restricted cash associated with vehicle debt.
Unamortized debt issue costs are required to be reported as a
deduction from the carrying amount of the related debt obligation
under GAAP. Management believes that eliminating the effects that
these costs have on debt will more accurately reflect the Company's
net debt position. Total Net Debt is important to management,
investors and ratings agencies as it helps measure the Company's
gross leverage.
KEY METRICS
Available Car Days
Available Car Days is calculated as Average Vehicles multiplied
by the number of days in a period.
Average Vehicles ("Fleet Capacity" or
"Capacity")
Average Vehicles is determined using a simple average of the
number of vehicles in the fleet whether owned or leased by the
Company at the beginning and end of a given period. Among other
things, Average Vehicles is used to calculate Vehicle Utilization
which represents the portion of the Company's vehicles that are
being utilized to generate revenue.
Depreciation Per Unit Per Month
Depreciation Per Unit Per Month represents the amount of average
depreciation expense and lease charges per vehicle per month and is
calculated as depreciation of revenue earning vehicles and lease
charges, with all periods adjusted to eliminate the effect of
fluctuations in foreign currency exchange rates, divided by the
Average Vehicles in each period and then dividing by the number of
months in the period reported. Management believes eliminating the
effect of fluctuations in foreign currency exchange rates is
appropriate so as not to affect the comparability of underlying
trends. This metric is important to management and investors as it
is reflective of how the Company is managing the costs of its
vehicles and facilitates in comparison with other participants in
the vehicle rental industry.
Time and Mileage Revenue Per Transaction Day ("Time and
Mileage pricing" or "T&M Rate")
Time and Mileage ("T&M") pricing is calculated as Total
Rental Revenue less ancillary revenue from value-added services,
such as charges to the customer for the fueling of vehicles, loss
damage waivers, insurance products, supplemental equipment and
other consumables, divided by the total number of Transaction Days.
This metric is important to management and investors as it
represents a measurement of the changes in base rental fees, which
comprise the majority of the Company's Total RPD.
Total Rental Revenue
Total Rental Revenue is calculated as total revenue less
ancillary retail vehicle sales revenue, with all periods adjusted
to eliminate the effect of fluctuations in foreign currency
exchange rates. Management believes eliminating the effect of
fluctuations in foreign currency exchange rates is appropriate so
as not to affect the comparability of underlying trends.
Total Revenue Per Transaction Day ("Total RPD"or "RPD";
also referred to as "pricing")
Total RPD is calculated as Total Rental Revenue divided by the
total number of Transaction Days. This metric is important to
management and investors as it represents a measurement of the
changes in underlying pricing in the vehicle rental business and
encompasses the elements in vehicle rental pricing that management
has the ability to control.
Total Revenue Per Unit Per Month ("Total RPU" or "Total
RPU Per Month")
Total RPU Per Month is calculated as Total Rental Revenue
divided by the Average Vehicles in each period and then dividing by
the number of months in the period reported. This metric is
important to management and investors as it provides a measure of
revenue productivity relative to fleet capacity, or asset
efficiency.
Transaction Days ("Days"; also referred to as
"volume")
Transaction Days, also known as volume, represent the total
number of 24-hour periods, with any partial period counted as one
Transaction Day, that vehicles were on rent (the period between
when a rental contract is opened and closed) in a given period.
Thus, it is possible for a vehicle to attain more than one
Transaction Day in a 24-hour period. This metric is important to
management and investors as it represents the number of revenue
generating days.
Vehicle Utilization ("Utilization")
Vehicle Utilization is calculated by dividing Transaction Days
by Available Car Days. This metric is important to management and
investors as it is the measurement of the proportion of vehicles
that are being used to generate revenues relative to fleet
capacity.
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SOURCE Hertz Global Holdings, Inc.