Park Ridge, N.J.-based Hertz Global Holdings last week reported second-quarter 2009 worldwide revenues of $1.8 billion, a decrease of 22.9 percent, or $520.8 million, year-over-year. Revenues from worldwide equipment rental for the second quarter were $277.0 million, down 37.5 percent over the prior year period. Worldwide car rental revenues for the quarter decreased 19.4 percent to $1.5 billion.
Second-quarter 2009 adjusted pre-tax income was $81.1 million, versus $154.7 million in 2008, and income before income taxes, on a GAAP basis, was $30.7 million, versus $93.0 million in the second quarter of 2008. Corporate EBITDA for the second quarter of 2009 was $280.7 million, a decrease of 25.8 percent from the same period in 2008.
Second-quarter 2009 adjusted net income was $49.6 million versus $96.4 million in the same period of 2008, resulting in adjusted diluted earnings per share for the quarter of $0.12, compared with $0.30 for the second quarter of 2008. Second-quarter 2009 net income, on a GAAP basis, was $3.9 million or $0.01 per share on a diluted basis, compared with $51.2 million, or $0.16 per share on a diluted basis, for the second quarter of 2008.
“In the second quarter we continued to make solid progress mitigating the effects of lower revenues attributable to the recession,” said Mark Frissora, Hertz chairman and CEO. “We achieved a second-quarter profit on a GAAP and non-GAAP basis, narrowing the year-over-year decline in adjusted pre-tax income to $74 million, on $521 million lower revenues, or profit retention of 86 percent. We also retained more than 80 percent of corporate EBITDA. Our cost reduction efforts are on target and we expect to achieve annualized savings of at least $570 million this year.”
The company took $33.3 million in restructuring and related charges in the second quarter of 2009, primarily attributable to costs associated with job reductions, the closure of rental locations and outsourcing/process reengineering. The company said it expects restructuring and related charges will diminish significantly starting in 2010.
In the worldwide equipment rental business adjusted pre-tax income for the second quarter of 2009 was $24.7 million, a 71.1-percent decrease over the prior year period, primarily attributable to the effects of reduced volume and pricing, partially offset by cost management initiatives. HERC achieved an adjusted pre-tax margin, based on revenues, of 8.9 percent, and a corporate EBITDA margin, based on revenues, of 42.7 percent for the quarter.
“The equipment rental business remains challenging, but HERC continues to generate corporate EBITDA margins exceeding 40 percent, which we expect will continue throughout 2009. We were especially pleased to generate incremental total net cash flow of approximately $1.65 billion for the first six months of this year.”
The average acquisition cost of rental equipment operated during the second quarter of 2009 decreased by 18.3 percent year-over- year — compared with an 8.4-percent increase in the second quarter of 2008 over the second quarter of 2007 — to $2.8 billion, and net revenue earning equipment as of June 30, was $1.9 billion, a 25.2-percent decrease from the amount as of Dec. 31.
For the full-year 2009, the company still expects to generate worldwide revenues in the range of $6.7 to $7.0 billion, corporate EBITDA in the range of $900 million to $935 million, adjusted pre-tax income in the range of $100 to $120 million and adjusted diluted earnings per share in the range of $0.12 to $0.15.
Hertz Global Holdings is the parent company of Hertz Equipment Rental Corp., No. 4 on the RER 100.
