HERTZ REPORTS SECOND QUARTER 2024 RESULTS
"We're moving quickly with a best-in-class leadership team, a strategy laser-focused on delivering sustainable returns and elevating our operational performance across the business," said Gil West, Hertz CEO. "During the second quarter, we bolstered our liquidity to expedite our cost and revenue improvement initiatives and accelerate our fleet refresh to provide vehicles aligned with customer needs. We are at an exciting inflection point in our path to generate greater value for our customers, employees and shareholders - and I am more confident than ever in our plan, our team and the road ahead."
ESTERO, Fla., Aug. 1, 2024 /PRNewswire/ -- Hertz Global Holdings, Inc. (NASDAQ: HTZ) ("Hertz", "Hertz Global" or the "Company") today reported results for its second quarter 2024.
OVERVIEW
-- Revenue of $2.4 billion
-- GAAP net loss of $865 million, a negative 37% margin, or $2.82 loss per
diluted share
-- Adjusted net loss of $440 million, or $1.44 loss per diluted share
-- Adjusted Corporate EBITDA of negative $460 million, a negative 20%
margin, due mainly to an increase in vehicle depreciation of $706
million largely driven by acceleration of the Company's fleet refresh
-- GAAP operating cash flow of $546 million; Adjusted operating cash
outflow of $576 million and adjusted free cash outflow of $553 million
-- The Company raised $1 billion during the quarter to bolster liquidity
and de-risk its fleet refresh
-- Corporate liquidity of $1.8 billion at June 30, 2024
SECOND QUARTER RESULTS
Second quarter revenue was $2.4 billion. Demand was healthy yet the Company remained disciplined on capacity and prioritized rate. Execution of the Company's revenue strategy continued to narrow its year-over-year RPD decline, which was 3% for the quarter and moderated to 2% in June.
Vehicle depreciation increased $706 million compared to the prior year quarter due mainly to a decline in future and current residual values. As previously announced, acceleration of the Company's fleet refresh shortened the hold period on a substantial portion of its fleet, which resulted in DPU of $600 for the quarter, up sequentially from Q1 2024. The Company expects to substantially complete the refresh by the end of 2025, at which time it expects DPU to normalize in the low $300s.
Direct operating expense on a per transaction day basis in the second quarter of 2024 increased by 7% year over year. Approximately 30% of the increase was driven by non-recurring charges in both periods. The remaining increase was driven by insurance, personnel, and collision and damage costs, as well as general inflationary pressure. The Company has cost management actions in place to reduce expenses and increase productivity.
Consistent with previous guidance, Adjusted Corporate EBITDA was negative $460 million in the quarter compared with positive Adjusted Corporate EBITDA of $347 million in the prior year quarter. The decrease was due mainly to increased vehicle depreciation.
Recently, the Company announced critical executive management appointments to strengthen its leadership team and sharpen the Company's focus on driving enhanced profitability through operational excellence, superior customer service, strategic fleet management, cost control, and premium revenue.
SUMMARY RESULTS
Three Months Ended Percent
Inc/(Dec)
June 30,
2024 vs 2023
($ in millions, except earnings per share or where noted) 2024 2023
---
Hertz Global - Consolidated
---
Total revenues $2,353 $2,437 (3) %
Net income (loss) $(865) $139
NM
Net income (loss) margin (37) % 6 %
Adjusted net income (loss)(a) $(440) $227
NM
Adjusted diluted earnings (loss) per share(a) $(1.44) $0.72
NM
Adjusted Corporate EBITDA(a) $(460) $347
NM
Adjusted Corporate EBITDA Margin(a) (20) % 14 %
Average Vehicles (in whole units) 577,224 561,277 3 %
Average Rentable Vehicles (in whole units) 546,187 533,813 2 %
Vehicle Utilization 80 % 82 %
Transaction Days (in thousands) 39,721 39,705 - %
Total RPD (in dollars)(b) $59.65 $61.62 (3) %
Total RPU Per Month (in whole dollars)(b) $1,446 $1,527 (5) %
Depreciation Per Unit Per Month (in whole dollars)(b) $600 $197
NM
Americas RAC Segment
---
Total revenues $1,928 $2,015 (4) %
Adjusted EBITDA $(403) $331
NM
Adjusted EBITDA Margin (21) % 16 %
Average Vehicles (in whole units) 467,863 457,405 2 %
Average Rentable Vehicles (in whole units) 439,284 431,921 2 %
Vehicle Utilization 81 % 83 %
Transaction Days (in thousands) 32,216 32,469 (1) %
Total RPD (in dollars)(b) $59.94 $62.11 (3) %
Total RPU Per Month (in whole dollars)(b) $1,465 $1,556 (6) %
Depreciation Per Unit Per Month (in whole dollars)(b) $645 $198
NM
International RAC Segment
---
Total revenues $425 $422 1 %
Adjusted EBITDA $(6) $96
NM
Adjusted EBITDA Margin (1) % 23 %
Average Vehicles (in whole units) 109,361 103,872 5 %
Average Rentable Vehicles (in whole units) 106,903 101,892 5 %
Vehicle Utilization 77 % 78 %
Transaction Days (in thousands) 7,505 7,237 4 %
Total RPD (in dollars)(b) $58.38 $59.41 (2) %
Total RPU Per Month (in whole dollars)(b) $1,366 $1,406 (3) %
Depreciation Per Unit Per Month (in whole dollars)(b) $409 $188
NM
NM - Not meaningful
(a) Represents a non-GAAP measure. See the accompanying reconciliations included in Supplemental Schedule II for 2024 and 2023.
(b) Based on December 31, 2023 foreign exchange rates.
EARNINGS WEBCAST INFORMATION
Hertz Global's live webcast and conference call to discuss its second quarter 2024 results will be held on August 1, 2024, at 9:00 a.m. Eastern Time. The conference call will be broadcast live in listen-only mode on the Company's investor relations website at IR.Hertz.com. If you would like to access the call by phone and ask a question, please go to Hertz Q2 earnings participant call link, and you will be provided with dial in details. Investors are encouraged to dial-in approximately 15 minutes prior to the call. A web replay will remain available on the website for approximately one year. The earnings release and related supplemental schedules containing the reconciliations of non-GAAP measures will be available on the Hertz website, IR.Hertz.com.
UNAUDITED FINANCIAL DATA, SUPPLEMENTAL SCHEDULES, NON-GAAP MEASURES AND DEFINITIONS
In this earnings release, we include select unaudited financial data of Hertz Global, Supplemental Schedules, which are provided to present segment results, and reconciliations of non-GAAP measures to their most comparable GAAP measures. Following the Supplemental Schedules, the Company provides definitions for terminology used throughout the earnings release and its rationale on the importance and usefulness of non-GAAP measures for investors and management.
ABOUT HERTZ
The Hertz Corporation, a subsidiary of Hertz Global Holdings, Inc., operates the Hertz, Dollar and Thrifty vehicle rental brands throughout North America, Europe, the Caribbean, Latin America, Africa, the Middle East, Asia, Australia and New Zealand. The Hertz Corporation is one of the largest worldwide vehicle rental companies, and the Hertz brand is one of the most recognized globally. Additionally, The Hertz Corporation owns and operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets and sells vehicles through Hertz Car Sales. For more information about The Hertz Corporation, visit www.hertz.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained or incorporated by reference in this release, and in related comments by the Company's management, include "forward-looking statements." Forward-looking statements are identified by words such as "believe," "expect," "project," "potential," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts," "guidance" or similar expressions, and include information concerning our liquidity, our results of operations, our business strategies, the business environment and other information. These forward-looking statements are based on certain assumptions that the Company has made in light of its experience in the industry as well as its perceptions of historical trends, current conditions, expected future developments and other factors. The Company believes these judgments are reasonable, but you should understand that these forward-looking statements are not guarantees of future performance or results, and that the Company's actual results could differ materially from those expressed in the forward-looking statements due to a variety of important factors, both positive and negative, that may be revised or supplemented in subsequent reports, such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed or furnished to the SEC.
Important factors that could affect the Company's actual results and cause them to differ materially from those expressed in forward-looking statements include, among other things:
-- mix of program and non-program vehicles in the Company's fleet, which
can lead to increased exposure to residual value risk upon disposition;
-- the potential for residual values associated with non-program vehicles
in the Company's fleet to decline, including suddenly or unexpectedly,
or fail to follow historical seasonal patterns;
-- the Company's ability to purchase adequate supplies of competitively
priced vehicles at a reasonable cost in order to efficiently service
rental demand, including upon any disruptions in the global supply
chain;
-- the Company's ability to effectively dispose of vehicles, at the times
and through the channels, that maximize the Company's returns;
-- the age of the Company's fleet, and its impact on vehicle carrying
costs, customer service scores, as well as on the Company's ability to
sell vehicles at acceptable prices and times;
-- whether a manufacturer of the Company's program vehicle fulfills its
repurchase obligations;
-- the frequency or extent of manufacturer safety recalls;
-- levels of travel demand, particularly business and leisure travel in the
U.S. and in global markets;
-- seasonality and other occurrences that disrupt rental activity during
the Company's peak periods, including in critical geographies;
-- the Company's ability to accurately estimate future levels of rental
activity and adjust the number, location and mix of vehicles used in the
Company's rental operations accordingly;
-- the Company's ability to implement its business strategy or strategic
transactions, including the Company's ability to implement plans to
support an electric vehicle fleet and to play a central role in the
modern mobility ecosystem;
-- the Company's ability to achieve cost savings and normalized
depreciation levels, as well as revenue enhancements from its
profitability initiatives and other operational programs;
-- the Company's ability to adequately respond to changes in technology
impacting the mobility industry;
-- significant changes in the competitive environment and the effect of
competition in the Company's markets on rental volume and pricing;
-- the Company's reliance on third-party distribution channels and related
prices, commission structures and transaction volumes;
-- the Company's ability to offer services for a favorable customer
experience, and to retain and develop customer loyalty and market share;
-- the Company's ability to maintain its network of leases and vehicle
rental concessions at airports and other key locations in the U.S. and
internationally;
-- the Company's ability to maintain favorable brand recognition and a
coordinated branding and portfolio strategy;
-- the Company's ability to attract and retain effective frontline
employees, senior management and other key employees;
-- the Company's ability to effectively manage its union relations and
labor agreement negotiations;
-- the Company's ability to manage and respond to cybersecurity threats and
cyber attacks on the Company's information technology systems, or those
of the Company's third-party providers;
-- the Company's ability, and that of the Company's key third-party
partners, to prevent the misuse or theft of information the Company
possesses, including as a result of cyber attacks and other security
threats;
-- the Company's ability to maintain, upgrade and consolidate its
information technology systems;
-- the Company's ability to comply with current and future laws and
regulations in the U.S. and internationally regarding data protection,
data security and privacy risks;
-- risks associated with operating in many different countries, including
the risk of a violation or alleged violation of applicable
anti-corruption or anti-bribery laws and the Company's ability to
repatriate cash from non-U.S. affiliates without adverse tax
consequences;
-- risks relating to tax laws, including those that affect the Company's
ability to recapture accelerated tax depreciation and expensing, as well
as any adverse determinations or rulings by tax authorities;
-- the Company's ability to utilize its net operating loss carryforwards;
-- the Company's exposure to uninsured liabilities relating to personal
injury, death and property damage, or otherwise, including material
litigation;
-- the potential for adverse changes in laws, regulations, policies or
other activities of governments, agencies and similar organizations,
including those related to environmental matters, optional insurance
products or policies, franchising and licensing matters, the ability to
pass-through rental car related expenses, or taxes, among others, that
affect the Company's operations, the Company's costs or applicable tax
rates;
-- the Company's ability to recover its goodwill and indefinite-lived
intangible assets when performing impairment analysis;
-- the potential for changes in management's best estimates and
assessments;
-- the Company's ability to maintain an effective compliance program;
-- the availability of earnings and funds from the Company's subsidiaries;
-- the Company's ability to comply, and the cost and burden of complying,
with environmental, social and governance, or ESG, regulations or
expectations of stakeholders, and otherwise achieve the Company's
corporate responsibility goals;
-- the availability of additional or continued sources of financing at
acceptable rates for the Company's revenue earning vehicles and to
refinance the Company's existing indebtedness, and the Company's ability
to comply with the covenants in the agreements governing its
indebtedness;
-- the extent to which the Company's consolidated assets secure its
outstanding indebtedness;
-- volatility in the Company's share price, the Company's ownership
structure and certain provisions of the Company's charter documents,
which could negatively affect the market price of the Company's common
stock;
-- the Company's ability to implement an effective business continuity plan
to protect the business in exigent circumstances;
-- the Company's ability to effectively maintain effective internal control
over financial reporting; and
-- the Company's ability to execute strategic transactions.
Additional information concerning these and other factors can be found in the Company's filings with the SEC, including its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
You should not place undue reliance on forward-looking statements. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the foregoing cautionary statements. All such statements speak only as of the date of this release, and, except as required by law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
UNAUDITED FINANCIAL INFORMATION
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
June 30, June 30,
(In millions, except per share data) 2024 2023 2024 2023
---
Revenues $2,353 $2,437 $4,433 $4,484
Expenses:
Direct vehicle and operating 1,440 1,347 2,806 2,568
Depreciation of revenue earning vehicles and lease charges, net 1,035 329 2,004 710
Depreciation and amortization of non-vehicle assets 41 32 73 67
Selling, general and administrative 243 285 405 506
Interest expense, net:
Vehicle 149 132 290 243
Non-vehicle 88 56 163 107
Total interest expense, net 237 188 453 350
Other (income) expense, net (5) (2) (3) 7
(Gain) on sale of non-vehicle capital assets - (162)
Change in fair value of Public Warrants (165) 100 (251) 218
Total expenses 2,826 2,279 5,487 4,264
Income (loss) before income taxes (473) 158 (1,054) 220
Income tax (provision) benefit (392) (19) 3 115
Net income (loss) $(865) $139 $(1,051) $335
Weighted average number of shares outstanding:
Basic 306 314 306 318
Diluted 306 315 306 319
Earnings (loss) per share:
Basic $(2.82) $0.44 $(3.44) $1.06
Diluted $(2.82) $0.44 $(3.44) $1.05
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In millions, except par value and share data) June 30, 2024 December 31,
2023
---
ASSETS
Cash and cash equivalents $568 $764
Restricted cash and cash equivalents:
Vehicle 137 152
Non-vehicle 289 290
Total restricted cash and cash equivalents 426 442
Total cash and cash equivalents and restricted cash and cash equivalents 994 1,206
Receivables:
Vehicle 164 211
Non-vehicle, net of allowance of $53 and $47, respectively 1,103 980
Total receivables, net 1,267 1,191
Prepaid expenses and other assets 754 726
Revenue earning vehicles:
Vehicles 18,122 16,806
Less: accumulated depreciation (2,753) (2,155)
Total revenue earning vehicles, net 15,369 14,651
Property and equipment, net 670 671
Operating lease right-of-use assets 2,229 2,253
Intangible assets, net 2,858 2,863
Goodwill 1,044 1,044
Total assets $25,185 $24,605
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable:
Vehicle $429 $191
Non-vehicle 566 510
Total accounts payable 995 701
Accrued liabilities 931 860
Accrued taxes, net 208 157
Debt:
Vehicle 12,774 12,242
Non-vehicle 4,595 3,449
Total debt 17,369 15,691
Public Warrants 203 453
Operating lease liabilities 2,108 2,142
Self-insured liabilities 501 471
Deferred income taxes, net 912 1,038
Total liabilities 23,227 21,513
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value, no shares issued and outstanding -
Common stock, $0.01 par value, 481,250,923 and 479,990,286 shares issued, respectively, and 5 5
306,438,879 and 305,178,242 shares outstanding, respectively
Treasury stock, at cost, 174,812,044 and 174,812,044 common shares, respectively (3,430) (3,430)
Additional paid-in capital 6,365 6,405
Retained earnings (Accumulated deficit) (691) 360
Accumulated other comprehensive income (loss) (291) (248)
Total stockholders' equity 1,958 3,092
Total liabilities and stockholders' equity $25,185 $24,605
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended Six Months Ended
June 30, June 30,
(In millions) 2024 2023 2024 2023
---
Cash flows from operating activities:
Net income (loss) $(865) $139 $(1,051) $335
Adjustments to reconcile net income (loss) to net cash provided by (used in)
operating activities:
Depreciation and reserves for revenue earning vehicles, net 1,124 418 2,194 884
Depreciation and amortization, non-vehicle 41 32 73 67
Amortization of deferred financing costs and debt discount (premium) 15 15 33 29
Stock-based compensation charges 16 22 32 43
Stock-based compensation forfeitures - (68)
Provision for receivables allowance 32 20 63 40
Deferred income taxes, net 349 (28) (65) (163)
(Gain) loss on sale of non-vehicle capital assets 2 (3) 3 (165)
Change in fair value of Public Warrants (165) 100 (251) 218
Changes in financial instruments 2 (2) 8 106
Other 6 5 (4) 5
Changes in assets and liabilities:
Non-vehicle receivables (165) (284) (201) (334)
Prepaid expenses and other assets (3) (50) (59) (98)
Operating lease right-of-use assets 90 87 190 165
Non-vehicle accounts payable 67 33 63 6
Accrued liabilities 40 39 71 68
Accrued taxes, net 31 55 52 56
Operating lease liabilities (100) (94) (200) (178)
Self-insured liabilities 29 (7) 33 (25)
Net cash provided by (used in) operating activities 546 497 916 1,059
Cash flows from investing activities:
Revenue earning vehicles expenditures (3,723) (3,719) (5,627) (6,543)
Proceeds from disposal of revenue earning vehicles 1,669 1,560 2,902 2,766
Non-vehicle capital asset expenditures (26) (78) (59) (123)
Proceeds from non-vehicle capital assets disposed of 4 1 7 176
Return of (investment in) equity investments (1) (1) (3) (1)
Net cash provided by (used in) investing activities (2,077) (2,237) (2,780) (3,725)
Cash flows from financing activities:
Proceeds from issuance of vehicle debt 1,149 1,960 1,683 4,021
Repayments of vehicle debt (229) (682) (1,121) (1,872)
Proceeds from issuance of non-vehicle debt 1,950 825 2,885 1,250
Repayments of non-vehicle debt (1,245) (329) (1,735) (759)
Payment of financing costs (42) (9) (42) (17)
Share repurchases - (104) (222)
Other (1) 1 (3)
Net cash provided by (used in) financing activities 1,582 1,662 1,667 2,401
Effect of foreign currency exchange rate changes on cash and cash (2) 2 (15) 13
equivalents and restricted cash and cash equivalents
Net increase (decrease) in cash and cash equivalents and restricted cash and 49 (76) (212) (252)
cash equivalents during the period
Cash and cash equivalents and restricted cash and cash equivalents at 945 1,242 1,206 1,418
beginning of period
Cash and cash equivalents and restricted cash and cash equivalents at end of $994 $1,166 $994 $1,166
period
Supplemental Schedule I
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
Three Months Ended June 30, 2024
Three Months Ended June 30, 2023
(In millions) Americas International Corporate Hertz Global Americas International Corporate Hertz Global
RAC RAC RAC RAC
---
Revenues $1,928 $425
$ - $2,353 $2,015 $422
$ - $2,437
Expenses:
Direct vehicle and operating 1,199 244 (3) 1,440 1,139 211 (3) 1,347
Depreciation of revenue earning vehicles and lease 905 130 1,035 272 57 329
charges, net
Depreciation and amortization of non-vehicle assets 28 3 10 41 27 3 2 32
Selling, general and administrative 137 46 60 243 148 45 92 285
Interest expense, net:
Vehicle 123 26 149 113 19 132
Non-vehicle - (6) 94 88 (4) (5) 65 56
Total interest expense, net 123 20 94 237 109 14 65 188
Other (income) expense, net 1 (6) (5) (4) 2 (2)
Change in fair value of Public Warrants - (165) (165) 100 100
Total expenses 2,393 443 (10) 2,826 1,695 326 258 2,279
Income (loss) before income taxes $(465) $(18) $10 (473) $320 $96 $(258) 158
Income tax (provision) benefit (392) (19)
Net income (loss) $(865) $139
Supplemental Schedule I (continued)
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
Six Months Ended June 30, 2024
Six Months Ended June 30, 2023
(In millions) Americas International Corporate Hertz Global Americas International Corporate Hertz Global
RAC RAC RAC RAC
---
Revenues $3,667 $766
$ - $4,433 $3,745 $739
$ - $4,484
Expenses:
Direct vehicle and operating 2,351 460 (5) 2,806 2,178 393 (3) 2,568
Depreciation of revenue earning vehicles and lease 1,781 223 2,004 621 89 710
charges, net
Depreciation and amortization of non-vehicle assets 53 7 13 73 55 5 7 67
Selling, general and administrative 261 103 41 405 253 82 171 506
Interest expense, net:
Vehicle 239 51 290 206 37 243
Non-vehicle (2) (10) 175 163 (22) (7) 136 107
Total interest expense, net 237 41 175 453 184 30 136 350
Other (income) expense, net - 1 (4) (3) (1) 2 6 7
(Gain) on sale of non-vehicle capital assets - (162) (162)
Change in fair value of Public Warrants - (251) (251) 218 218
Total expenses 4,683 835 (31) 5,487 3,128 601 535 4,264
Income (loss) before income taxes $(1,016) $(69) $31 (1,054) $617 $138 $(535) 220
Income tax (provision) benefit 3 115
Net income (loss) $(1,051) $335
Supplemental Schedule II
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - ADJUSTED NET INCOME (LOSS), ADJUSTED DILUTED EARNINGS (LOSS) PER SHARE AND ADJUSTED CORPORATE EBITDA
Unaudited
Three Months Ended Six Months Ended
June 30,
June 30,
(In millions, except per share data) 2024 2023 2024 2023
---
Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share:
Net income (loss)(a) $(865) $139 $(1,051) $335
Adjustments:
Income tax provision (benefit) 392 19 (3) (115)
Vehicle and non-vehicle debt-related charges(b) 16 15 34 29
Restructuring and restructuring related charges(c) 12 5 44 8
Acquisition accounting-related depreciation and amortization(d) 1 1 1 1
Unrealized (gains) losses on financial instruments(e) 2 (2) 8 106
(Gain) on sale of non-vehicle capital assets(f) - (162)
Change in fair value of Public Warrants (165) 100 (251) 218
Other items(g)(k) 20 (10) 28 4
Adjusted pre-tax income (loss)(h) (587) 267 (1,190) 424
Income tax (provision) benefit on adjusted pre-tax income (loss)(i) 147 (40) 298 (64)
Adjusted Net Income (Loss) $(440) $227 $(892) $360
Weighted-average number of diluted shares outstanding 306 315 306 319
Adjusted Diluted Earnings (Loss) Per Share(j) $(1.44) $0.72 $(2.92) $1.13
Adjusted Corporate EBITDA:
Net income (loss) $(865) $139 $(1,051) $335
Adjustments:
Income tax provision (benefit) 392 19 (3) (115)
Non-vehicle depreciation and amortization 41 32 73 67
Non-vehicle debt interest, net of interest income 88 56 163 107
Vehicle debt-related charges(b) 10 10 22 20
Restructuring and restructuring related charges(c) 12 5 44 8
Unrealized (gains) losses on financial instruments(e) 2 (2) 8 106
(Gain) on sale of non-vehicle capital assets(f) - (162)
Non-cash stock-based compensation forfeitures(l) - (64)
Change in fair value of Public Warrants (165) 100 (251) 218
Other items(g) 25 (12) 32
Adjusted Corporate EBITDA(l) $(460) $347 $(1,027) $584
Adjusted Corporate EBITDA margin (20) % 14 % (23) % 13 %
(a) Net income (loss) margin for the three and six months ended June 30, 2024 was (37)% and (24)%, respectively. Net income (loss) margin for the three and six months ended June 30, 2023 was 6% and 7%,
respectively.
(b)
Represents debt-related charges relating to the amortization of deferred financing costs and debt discounts and premiums.
(c) Represents charges incurred under restructuring actions as defined in U.S. GAAP. Also includes restructuring related charges such as incremental costs incurred related to personnel reductions and closure
of underperforming locations.
(d)
Represents incremental expense associated with the amortization of other intangible assets and depreciation of property and equipment relating to acquisition accounting.
(e) Represents unrealized gains (losses) on derivative financial instruments. In 2023, also includes the realization of $88 million of previously unrealized gains resulting from the unwind of certain
interest rate caps in the first quarter of 2023.
(f)
Represents gain on the sale of certain non-vehicle capital assets sold in March 2023.
(g) Represents miscellaneous items. For the three and six months ended June 30, 2024, primarily includes certain IT-related charges and certain storm-related damages, partially offset by certain litigation
settlements. For the three and six months ended June 30, 2023, primarily includes a loss recovery settlement, partially offset by certain IT-related charges.
(h) The table below reconciles expenses as reported in the condensed consolidated unaudited statement of operations to adjusted expenses utilized in calculating Adjusted Pretax Income (Loss) and Adjusted Net
Income (Loss), all of which are deemed non-GAAP measures:
(in millions) Three Months Ended June 30, 2024 Three Months Ended June 30, 2023
Expenses: As Reported Adjustment As Adjusted As Reported Adjustment As Adjusted
---
Direct vehicle and operating 1,440 $(10) $1,430 1,347 $17 $1,364
Depreciation of revenue earning vehicles and lease charges, net 1,035 1,035 329 329
Depreciation and amortization of non-vehicle assets 41 41 32 32
Selling, general and administrative 243 (16) 227 285 (13) 272
Interest expense, net:
Vehicle 149 (13) 136 132 (3) 129
Non-vehicle 88 (10) 78 56 (9) 47
Total interest expense, net 237 (23) 214 188 (12) 176
Other income (expense), net (5) (2) (7) (2) (1) (3)
Change in fair value of Public Warrants (165) 165 100 (100)
Total $2,826 $114 $2,940 $2,279 $(109) $2,170
(in millions) Six Months Ended June 30, 2024 Six Months Ended June 30, 2023
Expenses: As Reported Adjustment As Adjusted As Reported Adjustment As Adjusted
---
Direct vehicle and operating 2,806 $(16) $2,790 2,568 $17 $2,585
Depreciation of revenue earning vehicles and lease charges, net 2,004 5 2,009 710 2 712
Depreciation and amortization of non-vehicle assets 73 73 67 67
Selling, general and administrative 405 (55) 350 506 (27) 479
Interest expense, net:
Vehicle 290 (26) 264 243 (122) 121
Non-vehicle 163 (20) 143 107 (17) 90
Total interest expense, net 453 (46) 407 350 (139) 211
Other income (expense), net (3) (3) (6) 7 (1) 6
Gain on sale non-vehicle capital assets (162) 162
Change in fair value of Public Warrants (251) 251 218 (218)
Total $5,487 $136 $5,623 $4,264 $(204) $4,060
(i) Derived utilizing a combined statutory rate of 25% and 15% for the three and six months ended June 30, 2024 and 2023, respectively, applied to the respective Adjusted Pre-tax Income (Loss). The
increase in rate is primarily resulting from reduced EV-related tax credits anticipated to be used to decrease the Company's U.S. federal tax provision throughout 2024 based on the Company's expected
purchases of electric vehicles.
(j) Adjustments used to reconcile diluted earnings (loss) per share on a GAAP basis to Adjusted Diluted Earnings (Loss) Per Share are comprised of the same adjustments, inclusive of the tax impact, used to
reconcile net income (loss) to Adjusted Net Income (Loss) divided by the weighted-average diluted shares outstanding during the period.
(k)
Also includes letter of credit fees.
(l)
Represents former CEO awards forfeited in March 2024.
(m) The table below reconciles expenses as reported in the condensed consolidated unaudited statement of operations to adjusted expenses utilized in calculating Adjusted Corporate EBITDA, both of which are
deemed non-GAAP measures:
(in millions) Three Months Ended June 30, 2024 Three Months Ended June 30, 2023
Expenses: As Reported Adjustment As Adjusted As Reported Adjustment As Adjusted
---
Direct vehicle and operating 1,440 $(10) $1,430 1,347 $17 $1,364
Depreciation of revenue earning vehicles and lease charges, net 1,035 1,035 329 329
Depreciation and amortization of non-vehicle assets 41 (41) 32 (32)
Selling, general and administrative 243 (17) 226 285 (13) 272
Interest expense, net:
Vehicle 149 (13) 136 132 (3) 129
Non-vehicle 88 (88) 56 (56)
Total interest expense, net 237 (101) 136 188 (59) 129
Other income (expense), net (5) (9) (14) (2) (2) (4)
Change in fair value of Public Warrants (165) 165 100 (100)
Total $2,826 $(13) $2,813 $2,279 $(189) $2,090
(in millions) Six Months Ended June 30, 2024 Six Months Ended June 30, 2023
Expenses: As Reported Adjustment As Adjusted As Reported Adjustment As Adjusted
---
Direct vehicle and operating 2,806 $(16) $2,790 2,568 $17 $2,585
Depreciation of revenue earning vehicles and lease charges, net 2,004 5 2,009 710 2 712
Depreciation and amortization of non-vehicle assets 73 (73) 67 (67)
Selling, general and administrative 405 8 413 506 (27) 479
Interest expense, net:
Vehicle 290 (26) 264 243 (122) 121
Non-vehicle 163 (163) 107 (107)
Total interest expense, net 453 (189) 264 350 (229) 121
Other income (expense), net (3) (13) (16) 7 (4) 3
Gain on sale non-vehicle capital assets (162) 162
Change in fair value of Public Warrants (251) 251 218 (218)
Total $5,487 $(27) $5,460 $4,264 $(364) $3,900
Supplemental Schedule III
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - ADJUSTED OPERATING CASH FLOW
AND ADJUSTED FREE CASH FLOW
Unaudited
Three Months Ended Six Months Ended
June 30, June 30,
(In millions) 2024 2023 2024 2023
---
ADJUSTED OPERATING CASH FLOW AND ADJUSTED FREE CASH FLOW:
Net cash provided by (used in) operating activities $546 $497 $916 $1,059
Depreciation and reserves for revenue earning vehicles, net (1,124) (418) (2,194) (884)
Bankruptcy related payments (post emergence) and other payments 2 12 5 20
Adjusted operating cash flow (576) 91 (1,273) 195
Non-vehicle capital asset proceeds (expenditures), net (22) (77) (52) 53
Adjusted operating cash flow before vehicle investment (598) 14 (1,325) 248
Net fleet growth after financing 45 (437) 43 (754)
Adjusted free cash flow $(553) $(423) $(1,282) $(506)
CALCULATION OF NET FLEET GROWTH AFTER FINANCING:
Revenue earning vehicles expenditures $(3,723) $(3,719) $(5,627) $(6,543)
Proceeds from disposal of revenue earning vehicles 1,669 1,560 2,902 2,766
Revenue earning vehicles capital expenditures, net (2,054) (2,159) (2,725) (3,777)
Depreciation and reserves for revenue earning vehicles, net 1,124 418 2,194 884
Financing activity related to vehicles:
Borrowings 1,149 1,960 1,683 4,021
Payments (229) (682) (1,121) (1,872)
Restricted cash changes, vehicle 55 26 12 (10)
Net financing activity related to vehicles 975 1,304 574 2,139
Net fleet growth after financing $45 $(437) $43 $(754)
Supplemental Schedule IV
HERTZ GLOBAL HOLDINGS, INC.
NET DEBT CALCULATION
Unaudited
As of June 30, 2024 As of December 31, 2023
(In millions) Vehicle Non-Vehicle Total Vehicle Non-Vehicle Total
---
First Lien RCF
$ - $160 $160
$ -
$ -
$ -
Term loans - 2,004 2,004 2,013 2,013
First lien senior notes - 750 750
Exchangeable notes - 250 250
Senior unsecured notes - 1,500 1,500 1,500 1,500
U.S. vehicle financing (HVF III) 10,471 10,471 10,203 10,203
International vehicle financing (Various) 2,216 2,216 2,001 2,001
Other debt 144 21 165 110 2 112
Debt issue costs, discounts and premiums (57) (90) (147) (72) (66) (138)
Debt as reported in the balance sheet 12,774 4,595 17,369 12,242 3,449 15,691
Add:
Debt issue costs, discounts and premiums 57 90 147 72 66 138
Less:
Cash and cash equivalents - 568 568 764 764
Restricted cash 137 137 152 152
Restricted cash and restricted cash - 245 245 245 245
equivalents associated with Term C Loan
Net Debt $12,694 $3,872 $16,566 $12,162 $2,506 $14,668
LTM Adjusted Corporate EBITDA(a) (1,050) 561
Net Corporate Leverage NM 4.5x
NM - Not meaningful
(a) Reconciliation of LTM Adjusted Corporate EBITDA for the six months ended June 30, 2024 and twelve months ended December
31, 2023 are as follows:
(in millions) Six Months Ended Twelve Months Ended
June 30, 2024 December 31, 2023
---
Net income (loss) three months ended:
September 30, 2023 $629
n/a
December 31, 2023 (348)
n/a
March 31, 2024 (186)
n/a
June 30, 2024 (865)
n/a
LTM net income (loss) (770) $616
Adjustments:
Income tax provision (benefit) (218) (330)
Non-vehicle depreciation and amortization 155 149
Non-vehicle debt interest, net of interest income 294 238
Vehicle debt-related charges 44 42
Restructuring and restructuring related charge 59 17
Unrealized (gains) losses on financial instruments 19 117
(Gain) on sale of non-vehicle capital assets (162)
Non-cash stock-based compensation forfeitures (64)
Change in fair value of Public Warrants (632) (163)
Other items 69 37
LTM Adjusted Corporate EBITDA $(1,044) $561
Supplemental Schedule V
HERTZ GLOBAL HOLDINGS, INC.
KEY METRICS CALCULATIONS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
Global RAC
Three Months Ended June Percent Six Months Ended Percent
30, Inc/ Inc/
(Dec) (Dec)
June 30,
($ in millions, except where noted) 2024 2023 2024 2023
---
Total RPD
Revenues $2,353 $2,437 $4,433 $4,484
Foreign currency adjustment(a) 16 9 25 18
Total Revenues - adjusted for foreign currency $2,369 $2,446 $4,458 $4,502
Transaction Days (in thousands) 39,721 39,705 76,575 73,493
Total RPD (in dollars) $59.65 $61.62 (3) % $58.22 $61.27 (5) %
Total Revenue Per Unit Per Month
Total Revenues - adjusted for foreign currency $2,369 $2,446 $4,458 $4,502
Average Rentable Vehicles (in whole units) 546,187 533,813 537,710 508,550
Total revenue per unit (in whole dollars) $4,338 $4,582 $8,291 $8,853
Number of months in period (in whole units) 3 3 6 6
Total RPU Per Month (in whole dollars) $1,446 $1,527 (5) % $1,382 $1,476 (6) %
Vehicle Utilization
Transaction Days (in thousands) 39,721 39,705 76,575 73,493
Average Rentable Vehicles (in whole units) 546,187 533,813 537,710 508,550
Number of days in period (in whole units) 91 91 182 181
Available Car Days (in thousands) 49,701 48,576 97,882 92,079
Vehicle Utilization(b) 80 % 82 % 78 % 80 %
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease $1,035 $329 $2,004 $710
charges, net
Foreign currency adjustment(a) 5 2 8 4
Adjusted depreciation of revenue earning vehicles and $1,040 $331 $2,012 $714
lease charges
Average Vehicles (in whole units) 577,224 561,277 562,358 532,903
Adjusted depreciation of revenue earning vehicles and $1,801 $590 $3,577 $1,339
lease charges divided by Average Vehicles (in whole
dollars)
Number of months in period (in whole units) 3 3 6 6
Depreciation Per Unit Per Month (in whole dollars) $600 $197 NM $596 $223 NM
Note: Global RAC represents Americas RAC and International RAC segment information on a combined basis and excludes Corporate
NM - Not meaningful
(a)
Based on December 31, 2023 foreign exchange rates.
(b)
Calculated as Transaction Days divided by Available Car Days.
Supplemental Schedule V (continued)
HERTZ GLOBAL HOLDINGS, INC.
KEY METRICS CALCULATIONS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
Americas RAC
Three Months Ended June Percent Six Months Ended Percent
30, Inc/ Inc/
(Dec) (Dec)
June 30,
($ in millions, except where noted) 2024 2023 2024 2023
---
Total RPD
Revenues $1,928 $2,015 $3,667 $3,745
Foreign currency adjustment(a) 3 1 4 2
Total Revenues - adjusted for foreign currency $1,931 $2,016 $3,671 $3,747
Transaction Days (in thousands) 32,216 32,469 62,776 60,348
Total RPD (in dollars) $59.94 $62.11 (3) % $58.47 $62.10 (6) %
Total Revenue Per Unit Per Month
Total Revenues - adjusted for foreign currency $1,931 $2,016 $3,671 $3,747
Average Rentable Vehicles (in whole units) 439,284 431,921 436,553 412,717
Total revenue per unit (in whole dollars) $4,396 $4,668 $8,408 $9,079
Number of months in period (in whole units) 3 3 6 6
Total RPU Per Month (in whole dollars) $1,465 $1,556 (6) % $1,401 $1,513 (7) %
Vehicle Utilization
Transaction Days (in thousands) 32,216 32,469 62,776 60,348
Average Rentable Vehicles (in whole units) 439,284 431,921 436,553 412,717
Number of days in period (in whole units) 91 91 182 181
Available Car Days (in thousands) 39,974 39,304 79,470 74,725
Vehicle Utilization(b) 81 % 83 % 79 % 81 %
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease $905 $272 $1,781 $621
charges, net
Foreign currency adjustment(a) 1 2 1
Adjusted depreciation of revenue earning vehicles and $906 $272 $1,783 $622
lease charges
Average Vehicles (in whole units) 467,863 457,405 459,224 435,194
Adjusted depreciation of revenue earning vehicles and $1,936 $595 $3,882 $1,430
lease charges divided by Average Vehicles (in whole
dollars)
Number of months in period (in whole units) 3 3 6 6
Depreciation Per Unit Per Month (in whole dollars) $645 $198 NM $647 $238 NM
NM - Not meaningful
(a) Based on December 31, 2023 foreign exchange rates.
(b) Calculated as Transaction Days divided by
Available Car Days.
Supplemental Schedule V (continued)
HERTZ GLOBAL HOLDINGS, INC.
KEY METRICS CALCULATIONS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
International RAC
Three Months Ended June Percent Six Months Ended Percent
30, Inc/ Inc/
(Dec) (Dec)
June 30,
($ in millions, except where noted) 2024 2023 2024 2023
---
Total RPD
Revenues $425 $422 $766 $739
Foreign currency adjustment(a) 13 8 22 16
Total Revenues - adjusted for foreign currency $438 $430 $788 $755
Transaction Days (in thousands) 7,505 7,237 13,799 13,145
Total RPD (in dollars) $58.38 $59.41 (2) % $57.07 $57.45 (1) %
Total Revenue Per Unit Per Month
Total Revenues - adjusted for foreign currency $438 $430 $788 $755
Average Rentable Vehicles (in whole units) 106,903 101,892 101,156 95,834
Total revenue per unit (in whole dollars) $4,098 $4,219 $7,785 $7,880
Number of months in period (in whole units) 3 3 6 6
Total RPU Per Month (in whole dollars) $1,366 $1,406 (3) % $1,298 $1,313 (1) %
Vehicle Utilization
Transaction Days (in thousands) 7,505 7,237 13,799 13,145
Average Rentable Vehicles (in whole units) 106,903 101,892 101,156 95,834
Number of days in period (in whole units) 91 91 182 181
Available Car Days (in thousands) 9,727 9,271 18,413 17,354
Vehicle Utilization (b) 77 % 78 % 75 % 76 %
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease $130 $57 $223 $89
charges, net
Foreign currency adjustment(a) 4 2 6 3
Adjusted depreciation of revenue earning vehicles and $134 $59 $229 $92
lease charges
Average Vehicles (in whole units) 109,361 103,872 103,134 97,709
Adjusted depreciation of revenue earning vehicles and $1,226 $564 $2,220 $937
lease charges divided by Average Vehicles (in whole
dollars)
Number of months in period (in whole units) 3 3 6 6
Depreciation Per Unit Per Month (in whole dollars) $409 $188 NM $370 $156 NM
NM - Not meaningful
(a) Based on December 31, 2023 foreign exchange
rates.
(b) Calculated as Transaction Days divided by
Available Car Days.
NON-GAAP MEASURES AND KEY METRICS
The term "GAAP" refers to accounting principles generally accepted in the United States. Adjusted EBITDA is the Company's segment measure of profitability and complies with GAAP when used in that context.
NON-GAAP MEASURES
Non-GAAP measures are not recognized measurements under GAAP. When evaluating the Company's operating performance or liquidity, investors should not consider non-GAAP measures in isolation of, superior to, or as a substitute for measures of the Company's financial performance as determined in accordance with GAAP.
Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share ("Adjusted EPS")
Adjusted Net Income (Loss) represents income or loss attributable to the Company as adjusted to eliminate the impact of GAAP income tax; vehicle and non-vehicle debt-related charges; restructuring and restructuring related charges; acquisition accounting-related depreciation and amortization; unrealized (gains) losses on financial instruments, gain on sale of non-vehicle capital assets; change in fair value of Public Warrants and certain other miscellaneous items on a pre-tax basis. Adjusted Net Income (Loss) includes a provision (benefit) for income taxes derived utilizing a combined statutory rate. The combined statutory rate is management's estimate of the Company's long-term tax rate. Its most comparable GAAP measure is net income (loss) attributable to the Company.
Adjusted EPS represents Adjusted Net Income (Loss) on a per diluted share basis using the weighted-average number of diluted shares outstanding for the period. Its most comparable GAAP measure is diluted earnings (loss) per share.
Adjusted Net Income (Loss) and Adjusted EPS are important operating metrics because they allow management and investors to assess operational performance of the Company's business, exclusive of the items mentioned above that are not operational in nature or comparable to those of the Company's competitors.
Adjusted Corporate EBITDA and Adjusted Corporate EBITDA Margin
Adjusted Corporate EBITDA represents income or loss attributable to the Company as adjusted to eliminate the impact of GAAP income tax; non-vehicle depreciation and amortization; non-vehicle debt interest, net; vehicle debt-related charges; restructuring and restructuring related charges; unrealized (gains) losses on financial instruments; gain on sale of non-vehicle capital assets; former CEO stock-based compensation award forfeitures; change in fair value of Public Warrants and certain other miscellaneous items.
Adjusted Corporate EBITDA Margin is calculated as the ratio of Adjusted Corporate EBITDA to total revenues.
Management uses these measures as operating performance metrics for internal monitoring and planning purposes, including the preparation of the Company's annual operating budget and monthly operating reviews, and analysis of investment decisions, profitability and performance trends. These measures enable management and investors to isolate the effects on profitability of operating metrics most meaningful to the business of renting and leasing vehicles. They also allow management and investors to assess the performance of the entire business on the same basis as its reportable segments. Adjusted Corporate EBITDA is also utilized in the determination of certain executive compensation. Its most comparable GAAP measure is net income (loss) attributable to the Company.
Adjusted operating cash flow and adjusted free cash flow
Adjusted operating cash flow represents net cash provided by operating activities net of the non-cash add back for vehicle depreciation and reserves, and exclusive of bankruptcy related payments made post emergence. Adjusted operating cash flow is an important performance measure to management and investors as it provides useful information about the amount of cash generated from operations when fully burdened by fleet costs.
Adjusted free cash flow represents adjusted operating cash flow plus the impact of net non-vehicle capital expenditures and net fleet growth after financing. Adjusted free cash flow is an important performance measure to management and investors as it provides useful information about the amount of cash available for, but not limited to, the reduction of non-vehicle debt, share repurchase and acquisition.
The most comparable GAAP measure for adjusted operating cash flow and adjusted free cash flow is net cash provided by (used in) operating activities.
Net Fleet Growth After Financing
U.S. and International Rental Car segments Fleet Growth is defined as revenue earning vehicles expenditures, net of proceeds from disposals, plus vehicle depreciation and net vehicle financing, which includes borrowings, repayments and the change in restricted cash associated with vehicles. Fleet Growth is important as it allows the Company to assess the cash flow required to support its investment in revenue earning vehicles.
Net Non-vehicle Debt
Net Non-vehicle Debt is calculated as non-vehicle debt as reported on the Company's balance sheet, excluding the impact of unamortized debt issuance costs associated with non-vehicle debt, less cash and cash equivalents. Non-vehicle debt consists of the Company's Senior Term Loan, Senior RCF, First Lien Senior Notes, Second Lien Exchangeable Notes, Senior Second Priority Secured Notes, Senior Unsecured Notes, Promissory Notes and certain other non-vehicle indebtedness of its domestic and foreign subsidiaries. Net Non-vehicle Debt is important to management and investors as it helps measure the Company's corporate leverage. Net Non-vehicle Debt also assists in the evaluation of the Company's ability to service its non-vehicle debt without reference to the expense associated with the vehicle debt, which is collateralized by assets not available to lenders under the non-vehicle debt facilities.
Net Vehicle Debt
Net Vehicle Debt is calculated as vehicle debt as reported on the Company's balance sheet, excluding the impact of unamortized debt issue costs associated with vehicle debt, less restricted cash associated with vehicles. Restricted cash associated with vehicle debt is restricted for the purchase of revenue earning vehicles and other specified uses under the Company's vehicle debt facilities. Net Vehicle Debt is important to management, investors and ratings agencies as it helps measure the Company's leverage with respect to its vehicle assets.
Total Net Debt
Total Net Debt is calculated as total debt, excluding the impact of unamortized debt issuance costs, less total cash and cash equivalents and restricted cash associated with vehicle debt. Unamortized debt issuance costs are required to be reported as a deduction from the carrying amount of the related debt obligation under GAAP. Management believes that eliminating the effects that these costs have on debt will more accurately reflect the Company's net debt position. Total Net Debt is important to management, investors and ratings agencies as it helps measure the Company's gross leverage.
Net Corporate Leverage
Net Corporate Leverage is calculated as non-vehicle net debt divided by Adjusted Corporate EBITDA for the last twelve months. Net Corporate Leverage is important to management and investors as it measures the Company's corporate leverage net of unrestricted cash. Net Corporate Leverage also assists in the evaluation of the Company's ability to service its non-vehicle debt with reference to the generation of Adjusted Corporate EBITDA.
KEY METRICS
Available Rental Car Days
Available Rental Car Days represents Average Rentable Vehicles multiplied by the number of days in a given period.
Average Vehicles ("Fleet Capacity" or "Capacity")
Average Vehicles is determined using a simple average of the number of vehicles in the fleet whether owned or leased by the Company at the beginning and end of a given period.
Average Rentable Vehicles
Average Rentable Vehicles reflects Average Vehicles excluding vehicles for sale on the Company's retail lots or actively in the process of being sold through other disposition channels.
Depreciation Per Unit Per Month ("Depreciation Per Unit" or "DPU")
Depreciation Per Unit Per Month represents the amount of average depreciation expense and lease charges per vehicle per month, exclusive of the impacts of foreign currency exchange rates so as not to affect the comparability of underlying trends. This metric is important to management and investors as it reflects how effectively the Company is managing the costs of its vehicles and facilitates comparisons with other participants in the vehicle rental industry.
Total Revenue Per Transaction Day ("Total RPD"or "RPD"; also referred to as "pricing")
Total RPD represents revenue generated per transaction day, excluding the impact of foreign currency exchange rates so as not to affect the comparability of underlying trends. This metric is important to management and investors as it represents a measure of changes in the underlying pricing in the vehicle rental business and encompasses the elements in vehicle rental pricing that management has the ability to control.
Total Revenue Per Unit Per Month ("Total RPU", "RPU" or "Total RPU Per Month")
Total RPU Per Month represents the amount of revenue generated per vehicle in the rental fleet each month, excluding the impact of foreign currency exchange rates so as not to affect the comparability of underlying trends. This metric is important to management and investors as it provides a measure of revenue productivity relative to the number of vehicles in our rental fleet whether owned or leased, or asset efficiency.
Transaction Days ("Days"; also referred to as "volume")
Transaction Days represents the total number of 24-hour periods, with any partial period counted as one Transaction Day, that vehicles were on rent (the period between when a rental contract is opened and closed) in a given period. Thus, it is possible for a vehicle to attain more than one Transaction Day in a 24-hour period. This metric is important to management and investors as it represents the number of revenue-generating days.
Vehicle Utilization ("Utilization")
Vehicle Utilization represents the ratio of Transaction Days to Available Rental Car Days. This metric is important to management and investors as it is the measurement of the proportion of vehicles that are being used to generate revenues relative to rentable fleet capacity.
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SOURCE Hertz Global Holdings, Inc.
