Herc Holdings Inc. (NYSE:HRI) reported fourth-quarter 2024 sales growth of 14.4% year over year to $951 million, beating the analyst consensus estimate of $924.28 million.
Revenue growth was driven by $91 million in rental growth from 2.1% pricing and 11.6% volume increases. Adjusted EPS was $3.58, up from $3.24 but below the analyst consensus estimate of $3.94.
Direct operating expenses rose to $324 million (38.6% of rental revenue) from $287 million (38.4%).
Adjusted EBITDA grew 15% YoY to $438 million, with the margin slightly rising to 46.1% from 46.0%.
Net debt stood at $4 billion as of December 31, 2024, with 2.5x net leverage, unchanged from the prior year. Liquidity totaled $1.9 billion, including cash and unused ABL commitments.
Herc’s net cash provided by operating activities for fiscal 2024 totaled $1.225 billion, up from $1.086 billion a year ago. Free cash flow was $314 million.
“The 2025 operating landscape is still lacking good clarity,” commented Larry Silber, president and chief executive officer. “We are monitoring industry opportunities and believe the diversity of our business model, asset optimization and prudent investments will allow us to navigate local market pressure again this year, while capitalizing on incremental new mega project starts. Long term, we expect new government policies and spending initiatives will expand opportunities for Herc and our industry.”
As of Dec. 31, the company’s total fleet was $7 billion at OEC. Average fleet OEC was up 13% YoY in the quarter, and 11% for the year, while the average fleet age rose slightly to 46 months from 45 months.
2025 Outlook (excluding Cinelease): Herc expects equipment rental revenue growth guidance of 4% – 6% and adjusted EBITDA of $1.575 billion – $1.650 billion.
The company sees net rental equipment capex of $400 million—$600 million and gross capex of $700 million—$900 million. It aims to expand market share through fleet investments, strategic acquisitions, and cross-selling, with the Cinelease sale expected to close in 2025.
Price Action: HRI shares are trading higher by 1.26% at $210.37 on the last check Thursday.
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