Hertz says rental "moving in right direction"
09 August 2010
Hertz said the equipment rental industry continued to "move in the right direction" with revenues in June increasing by 18% compared to the same month in 2009.
Hertz Equipment Rental Co (HERC) posted revenues down 4% to US$265.8 million for the second quarter of 2010, with pre-tax profits of $14.4 million.
Mark Frissora, Hertz chairman and CEO, said in a conference call with analysts that "Everything continues to move in the right direction, including the industrial market recovery, new infrastructure projects and national accounts expansion."
The company told analysts that it would invest $150 million on new fleet in this current fiscal year (compared to around $60 million in 2009) and would increase that to $200 million in 2011.
Mr Frissora said he expected the rental business to grow by up to 15% in 2011, mainly the result of increased volumes.
The company has been winning business related to the Gulf Coast oil clean up. "BP, one of our largest national accounts, has continued to place orders for equipment to support the initial cleanup efforts of the oil spill in the Gulf. Our current monthly run rate for those orders is roughly $600000", said Mr Frissora.
Hertz has opened a Gulf Coast Customer Care Center to assist customers and government employees travelling to the Gulf Coast area who need rental cars and equipment for clean-up related activities.
Hertz said that HERC had ordered more than $7 million worth of equipment and was transferring trucks, vans and shuttle buses to its branches to meet customer demand. It is also opening on-site camps in Alabama and Florida to provide easier access to cars and equipment for its corporate customers.
Note: Quotes from analysts conference call courtesy of Seeking Alpha.