Herc Rentals posted total revenues of $740 million in the first quarter of 2023, compared to $568 million in the first quarter of 2022, a spectacular 30.3-percent increase. Rental revenue was $654 million for the quarter compared to $527 million a year, an also-strong 24-percent jump. In the first quarter of 2023, Herc reported net income of $67 million, or $2.28 per diluted share, a 19-percent hike compared to $58 million or $1.92 per diluted share in the year-ago frame.
“We continue to build on our momentum coming out of 2022 with record first quarter revenue that significantly outpaced industry growth,” said Larry Silber, president and CEO. “Higher rental rates are more than offsetting inflation, while demand across regions and in our end markets is seasonably strong, benefiting from the multi-year fiscal stimulus, re-shoring and mega projects, as well as long-term industrial maintenance contracts for on-site fleet management.
“While macro concerns are focused on residential and commercial construction, we have very diversified end markets, with growing share in manufacturing and reshoring projects, the private and government spend in infrastructure, as well as industrial MRO, which is required in all economic environments. Investments to capitalize on these opportunities are strategic and disciplined, whether it be in fleet, people or acquisitions. As a tenured and market leader with a strong reputation, a comprehensive product and service offering, broad capabilities and one of the leading teams in the industry, we will continue to execute on our strategies to win new business and deliver profitable growth.”
Herc credited its revenue increase to various factors, but particularly positive pricing of 7 percent, a $127 million increase in equipment rental revenue and sales of rental equipment jumping $43 million.
Dollar utilization for the quarter was 39.7 percent compared to 41.4 percent in last year’s first quarter, primarily because of a slowdown in the studio entertainment business as a result of a possible writers’ strike. Also, the company continued to accept equipment deliveries in the seasonably slow fourth quarter of 2022 and first quarter of 2023 in order to ensure that it has sufficient fleet for the upcoming warmer construction season.
Adjusted EBITDA increased 30 percent to $308 million compared to $237 million in the first quarter of 2022.
Rental equipment expenditures were $332 million compared to $287 million a year ago. As of March 31, 2023, Herc’s fleet was approximately $5.8 billion at original equipment cost.
Herc Rentals, based in Bonita Springs, Fla., is No. 3 on the RER 100.