BATON ROUGE, La. — H&E Equipment Services increased revenues 37.4 percent in the third quarter, from $148.5 million in the same period last year to $204.1 million this year. Equipment rental revenues were $67.3 for the third quarter, a 33.5-percent increase from $50.4 million in Q306.
For the third quarter, dollar utilization increased to 42.4 percent, compared with 39.9 percent in the third quarter last year. New equipment sales jumped 67.7 percent year over year, from $36.2 million last year to $60.7 million this year. Used equipment sales increased 10.8 percent from $26.8 million last year to $29.7 million. Parts sales jumped 23.5 percent year over year from $17 million in last year's third quarter to $21 million this year, while service revenues leaped 35.6 percent, from $10.4 million to $14.1 million.
Total gross profit for the third quarter was $68.7 million, compared with $46.8 million for the year-ago period, a 46.8-percent improvement, with higher sales volume and improved margins in several major business segments. Third-quarter gross profit margin grew 33.7 percent from 31.5 percent in last year's third quarter. Gross profit from equipment rentals increased 51.2 percent, from $24 million to $36.3 million.
The company reported a net loss of $11.5 million based on early extinguishments of debt of $40.8 million, or $32 million after tax, compared to net income of $8.2 million in last year's third period.
“The momentum in our business clearly continued through the third quarter,” said John Engquist, president and CEO. “While the loss on early extinguishment of debt significantly impacted our earnings this quarter, the core fundamentals of our operations remain very strong. Non-residential construction is extremely active in the markets we serve and we believe spending on the equipment and services we provide will remain strong as these positive trends are currently forecast to continue.
“Total revenue increased $55.6 million from a year ago to another record level and our adjusted EBITDA also reached record levels, increasing $23 million to $57.5 million. Income from operations increased 86.5 percent to $34.9 million. Overall our performance this quarter was consistent with the expectations for our business. We believe we are in the right markets with the right construction equipment and services, and the right business model, and the outlook for H&E remains strong.”
“Higher rental rates and fleet growth continue to drive the increase in rental revenues,” said chief financial officer Leslie Magee.
Although the company didn't provide any outlook on 2007, it is increasing its revenue outlook from its previously announced range of about $750 million to $780 million to the range of $780 million to $795 million.
Based in Baton Rouge, La., H&E Equipment Services is No. 11 on the RER 100.