H&E Equipment’s rental operations helped to drive growth in the fourth quarter of 2019 despite a slowing market.
Total revenues rose by 0.6% to US$348.1 million in the fourth quarter compared to the previous year, while total revenues for the full year were up 8.8% on 2018, reaching $1.3 billion. Adjusted EBITDA profit was up 10.7% to $126.8 million in the fourth quarter, and for the full year it increased 16.7% to $473.2 million.
Total rental revenues rose by 7.8% in the fourth quarter to $193.8 million, compared to a rise of 16.8% to $766.4 million across the full year.
Brad Barber, CEO and President of the US-based company, said, “With seasonality, the balancing of supply and demand, and a challenging comparable in the year-ago quarter, the year finished as we expected during the fourth quarter.
“We produced solid results for the quarter despite these factors – growing revenues, gross profit and adjusted EBITDA.
“The strength in our rental business continued with rental revenues [in the fourth quarter] increasing 8.2% from a year ago and we again achieved rate growth, which increased 1.7%.”
The quarterly rise in rental revenues did show some slowing though, as it compared to a full-year rise of 17.3%.
Barber added, “Average physical utilisation for the year remained solid at 70.4% and average rates were 2.1% higher than in 2018. Overall, we are pleased with our execution and results for 2019.”
Used equipment sales in the fourth quarter increased by 12.1% to $42.4 million. The full year saw an 11.4% rise in used equipment sales, to $139.3 million.
Barber concluded, “Based on current industry indicators and customer sentiment, the non-residential construction markets we serve are expected to be stable in 2020.
“Increasing the scale and scope of our rental business through selective acquisitions and organic expansion remains one of our highest priorities.”