ESTERO, Fla., Nov. 29, 2021 /PRNewswire/ — Hertz Global Holdings, Inc. (NASDAQ: HTZ) ("Hertz" or the "Company") today announced that its Board of Directors has authorized a share repurchase program of up to $2.0 billion of the Company’s outstanding common stock.
The repurchase program is effective immediately and will initially comprise the remaining $200 million that was authorized for repurchase at the time of the Company’s offering and listing on NASDAQ. Hertz will be able to pursue the balance of the authorized amount upon completion of its previously disclosed tender offer and consent solicitation with respect to its outstanding Series A Preferred Stock, so long as holders of a majority of the Series A Preferred Stock tender such shares in the tender offer or deliver consents to certain amendments to the Series A Preferred Stock. Investment funds, accounts and other entities owned (in whole or in part), controlled, managed or advised by Apollo Capital Management, L.P. and its affiliates (collectively, "Apollo"), as holders of a majority of the outstanding Series A Preferred Stock, have agreed on the terms and subject to the conditions contained in an agreement between Hertz and Apollo to tender in the offer their shares referred to therein and to consent to the such amendment effective upon the completion of the tender offer.
The repurchase program allows for ongoing and profitable investment in the business while utilizing moderate balance sheet leverage and facilitating opportunistic share repurchases. The Company currently intends to maintain Net Corporate Leverage1 of no more than 1.5x.
Repurchases will be made at management’s discretion through a variety of methods, such as open-market transactions (including pre-set trading plans), privately negotiated transactions, accelerated share repurchases, and other transactions in accordance with applicable securities laws. The program has no time limit. The share repurchase authorization does not obligate the Company to acquire any particular amount of common stock and can be discontinued at any time. There can be no assurance as to the timing or number of shares of any repurchases.
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 operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets and sells vehicles through Hertz Car Sales.
Certain statements contained in this release include "forward-looking statements" within the meaning of applicable securities laws and regulations. These statements often include words such as "believe," "expect," "project," "potential," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts" or similar expressions. These statements are based on the Company’s current views with respect to future events and the timing of the tender offer. These forward-looking statements are subject to a number of risks and uncertainties including prevailing market conditions, as well as other factors. Forward-looking statements represent the Company’s estimates and assumptions only as of the date that they were made, 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.
1 Net Corporate Leverage is calculated as ratio of outstanding Non-vehicle Debt, excluding Term Loan C and the related Restricted Cash that collateralizes Term Loan C obligations, Net of Unrestricted Cash to Adjusted EBITDA for the trailing four fiscal quarters.
ESTERO, Fla., Nov. 23, 2021 /PRNewswire/ — Hertz Global Holdings, Inc. (NASDAQ: HTZ) ("Hertz" or the "Company") announced that it is commencing today a tender offer to purchase all of its outstanding Series A Preferred Stock, par value $0.01 per share (the "Series A Preferred Shares"), at a price per Series A Preferred Share of $1,250.00, less any applicable withholding taxes. The tender offer will expire at midnight (at the end of the day), Eastern Standard Time, on Tuesday, December 21, 2021, unless the offer is extended. Tenders of Series A Preferred Shares must be made prior to the expiration of the tender offer and may be withdrawn at any time prior to the expiration time, in each case, in accordance with the procedures described in the tender offer materials. The Company intends to pay for the shares repurchased in the tender offer with available cash, including proceeds from an offering of senior notes completed by the Company on November 23, 2021.
Stockholders whose Series A Preferred Shares are purchased in the tender offer will be paid $1,250.00 in cash, less any applicable withholding taxes, for each share after the expiration of the tender offer. As of November 23, 2021, there were 1,500,000 Series A Preferred Shares outstanding.
Concurrently with the tender offer, the Company is also soliciting consents from holders of the Series A Preferred Shares to amend (the "Proposed Amendment") the certificate of designation of the Series A Preferred Shares (as amended to date, the "Certificate of Designation") from and after the effective date of the Proposed Amendment to eliminate Section 8(b)(viii) of the Certificate of Designation. Section 8(b)(viii) of the Certificate of Designation currently provides that, without the affirmative vote or consent of holders of a majority of the Series A Preferred Shares outstanding at such time, we cannot make certain Restricted Payments (as defined in the Certificate of Designation) and certain of our Unrestricted Subsidiaries (as defined in the Certificate of Designation) cannot make certain payments in respect of Junior Stock (as defined in the Certificate of Designation), including any purchase thereof or acquisition thereof for value.
Pursuant to the terms of the Certificate of Designation, the consent of holders of a majority of the outstanding Series A Preferred Shares is required to approve the Proposed Amendment. Therefore, one of the conditions to the adoption of the Proposed Amendment is the receipt of the consent of holders of at least a majority of the outstanding Series A Preferred Shares. Investment funds, accounts and other entities owned (in whole or in part), controlled, managed or advised by Apollo Capital Management, L.P. and its affiliates (collectively, "Apollo"), as holders of a majority of the outstanding Series A Preferred Shares, have agreed on the terms and subject to the conditions contained in an agreement between Hertz and Apollo to tender in the Offer their shares referred to therein and to consent to the Proposed Amendment. Accordingly, we expect the Proposed Amendment will be approved and become effective promptly following the conclusion of the Offer.
Computershare Trust Company, N.A. is serving as the depositary for the tender offer. Once commenced, please direct all questions relating to the tender offer to the Company via e-mail at investorrelations@hertz.com.
The tender offer will not be contingent upon the receipt of financing or any minimum number of Series A Preferred Shares being tendered. However, the tender offer and consent solicitation are subject to a number of other terms and conditions, which will be described in detail in the offer to purchase for the tender offer and consent solicitation. Specific instructions and a complete explanation of the terms and conditions of the tender offer will be contained in the offer to purchase, the related letter of transmittal and other related materials, which will be provided to stockholders of record promptly after commencement of the tender offer.
While the Hertz Board of Directors has authorized Hertz to make the tender offer and consent solicitation, neither Hertz, its Board of Directors nor the depository makes any recommendation as to whether to tender and consent to the Proposed Amendment or refrain from tendering Series A Preferred Shares. Hertz has not authorized any person to make any such recommendation. Stockholders must make their own decision as to whether to tender some or all of their Series A Preferred Shares and consent to the Proposed Amendment. In doing so, stockholders should consult their own financial and tax advisors and read carefully and evaluate the information in the tender offer and consent solicitation documents, when available.
ADDITIONAL INFORMATION REGARDING THE TENDER OFFER
This communication is for informational purposes only. This communication is not a recommendation to buy or sell Hertz Series A Preferred Shares or any other securities, and it is neither an offer to purchase nor a solicitation of an offer to sell Hertz Series A Preferred Shares or any other securities. Hertz has filed a tender offer statement on Schedule TO, including an offer to purchase, letter of transmittal and related materials, with the United States Securities and Exchange Commission (the "SEC"). The tender offer and consent solicitation are only made pursuant to the offer to purchase, letter of transmittal and consent and related materials filed as a part of the Schedule TO. Stockholders should read carefully the offer to purchase, letter of transmittal and consent and related materials because they contain important information, including the various terms of, and conditions to, the tender offer and consent solicitation. Stockholders may obtain a free copy of the tender offer statement on Schedule TO, the offer to purchase, letter of transmittal and other documents that Hertz has filed with the SEC at the SEC’s website at www.sec.gov or from the Hertz website at www.hertz.com.com or from the depositary for the tender offer.
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 operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets and sells vehicles through Hertz Car Sales.
Certain statements contained in this release include "forward-looking statements" within the meaning of applicable securities laws and regulations. These statements often include words such as "believe," "expect," "project," "potential," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts" or similar expressions. These statements are based on the Company’s current views with respect to future events and the timing of the tender offer. These forward-looking statements are subject to a number of risks and uncertainties including prevailing market conditions, as well as other factors. Forward-looking statements represent the Company’s estimates and assumptions only as of the date that they were made, 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.
ESTERO, Fla., Nov. 17, 2021 /PRNewswire/ — Hertz Global Holdings, Inc. (NASDAQ: HTZ) ("Hertz" or the "Company") today announced that its wholly-owned indirect subsidiary, The Hertz Corporation ("Hertz Corp."), has entered into an agreement to sell $500 million aggregate principal amount of 4.625% Senior Notes due 2026 (the "2026 Notes") and $1.0 billion aggregate principal amount of 5.000% Senior Notes due 2029 (the "2029 Notes" and, together with the 2026 Notes, the "Notes") in a private offering (the "Offering") exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"). The Offering is expected to close on or about November 23, 2021, subject to customary closing conditions.
The Notes will pay interest semi-annually in arrears. The Notes are expected to be guaranteed on a senior unsecured basis by the domestic subsidiaries of Hertz Corp. that guarantee its first lien facilities from time to time.
Hertz Corp. intends to use the proceeds from the issuance of the Notes, together with available cash, to (i) repurchase all or a portion of the outstanding shares of Hertz’s Series A preferred stock and pay fees and expenses in connection therewith (either directly or indirectly by funding a dividend to Hertz) and (ii) pay fees and expenses in connection with the Offering. To the extent that the net proceeds from the Offering are in excess of the amounts required for the purposes described above, Hertz Corp. may elect to retain up to $250 million of such remaining net proceeds for general corporate purposes (the "GCP Cap"). To the extent that the remaining net proceeds exceed the GCP Cap (such amount in excess thereof, the "Excess Net Proceeds"), Hertz Corp. will be required to apply such Excess Net Proceeds (plus, at Hertz Corp.’s option, all or any portion of the GCP Cap) to redeem a portion of the Notes.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any of the Notes (or the guarantees of the Notes) or any other securities, nor will there be any sale of the Notes (or any guarantees of the Notes) or any other securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction. The Notes (and the guarantees of the Notes) will be issued in reliance on the exemption from the registration requirements provided by Rule 144A under the Securities Act and, outside of the United States, only to non-U.S. investors pursuant to Regulation S under the Securities Act. None of the Notes (or the guarantees of the Notes) have been registered under the Securities Act or any state or other jurisdiction’s securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state and other jurisdiction’s securities laws.
This press release does not constitute a notice of redemption under the certificate of designations governing Hertz’s Series A preferred stock, nor an offer to tender for, or purchase, any Series A preferred stock or any other security.
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 operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets and sells vehicles through Hertz Car Sales.
Certain statements contained in this release include "forward-looking statements" within the meaning of applicable securities laws and regulations. These statements often include words such as "believe," "expect," "project," "potential," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts" or similar expressions. These statements are based on the Company’s current views with respect to future events and the timing of the Offering and the use of the proceeds therefrom. These forward-looking statements are subject to a number of risks and uncertainties including prevailing market conditions, as well as other factors. Forward-looking statements represent the Company’s estimates and assumptions only as of the date that they were made, 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.
ESTERO, Fla., Nov. 17, 2021 /PRNewswire/ — Hertz Global Holdings, Inc. (NASDAQ: HTZ) ("Hertz" or the "Company") today announced that its wholly-owned indirect subsidiary, The Hertz Corporation ("Hertz Corp."), intends to offer $1.5 billion aggregate principal amount of senior unsecured notes due 2026 (the "2026 Notes") and senior unsecured notes due 2029 (the "2029 Notes" and, together with the 2026 Notes, the "Notes"), subject to market and other conditions, in a private offering (the "Offering") exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act").
The Notes will pay interest semi-annually in arrears. The Notes are expected to be guaranteed on a senior unsecured basis by the domestic subsidiaries of Hertz Corp. that guarantee its first lien facilities from time to time.
Hertz Corp. intends to use the proceeds from the issuance of the Notes, together with available cash, to (i) repurchase all or a portion of the outstanding shares of Hertz’s Series A preferred stock and pay fees and expenses in connection therewith (either directly or indirectly by funding a dividend to Hertz) and (ii) pay fees and expenses in connection with the Offering. To the extent that the net proceeds from the Offering are in excess of the amounts required for the purposes described above, Hertz Corp. may elect to retain up to $250 million of such remaining net proceeds for general corporate purposes (the "GCP Cap"). To the extent that the remaining net proceeds exceed the GCP Cap (such amount in excess thereof, the "Excess Net Proceeds"), Hertz Corp. will be required to apply such Excess Net Proceeds (plus, at Hertz Corp.’s option, all or any portion of the GCP Cap) to redeem a portion of the Notes.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any of the Notes (or the guarantees of the Notes) or any other securities, nor will there be any sale of the Notes (or any guarantees of the Notes) or any other securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction. The Notes (and the guarantees of the Notes) will be issued in reliance on the exemption from the registration requirements provided by Rule 144A under the Securities Act and, outside of the United States, only to non-U.S. investors pursuant to Regulation S under the Securities Act. None of the Notes (or the guarantees of the Notes) have been registered under the Securities Act or any state or other jurisdiction’s securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state and other jurisdiction’s securities laws.
This press release does not constitute a notice of redemption under the certificate of designations governing Hertz’s Series A preferred stock, nor an offer to tender for, or purchase, any Series A preferred stock or any other security.
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 operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets and sells vehicles through Hertz Car Sales.
Certain statements contained in this release include "forward-looking statements" within the meaning of applicable securities laws and regulations. These statements often include words such as "believe," "expect," "project," "potential," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts" or similar expressions. These statements are based on the Company’s current views with respect to future events and the timing of the Offering and the use of the proceeds therefrom. These forward-looking statements are subject to a number of risks and uncertainties including prevailing market conditions, as well as other factors. Forward-looking statements represent the Company’s estimates and assumptions only as of the date that they were made, 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.
ESTERO, Fla., Nov. 8, 2021 /PRNewswire/ — Hertz Global Holdings, Inc. (OTCPK:HTZZ) ("Hertz" or the "Company") announced today the pricing of an upsized public offering of 44,520,000 shares of its common stock by certain stockholders of Hertz at a price to the public of $29.00 per share. Of the shares offered, Hertz expects to repurchase from the underwriters 10,344,828 shares having an aggregate purchase price of $300 million at the price to the public in the offering (the "Repurchase"). In addition, a selling stockholder has granted the underwriters a 30-day option to purchase up to an additional 6,678,000 shares of Hertz common stock. Hertz will not receive any proceeds from the sale of shares by the selling stockholders. Hertz expects to fund the Repurchase with cash on hand. The Repurchase is subject to completion of the offering and the satisfaction of other customary conditions.
The shares are expected to begin trading on The Nasdaq Global Select Market on November 9, 2021 under the ticker symbol "HTZ." In addition, Hertz’s outstanding warrants are also expected to begin trading on The Nasdaq Global Select Market under the ticker symbol "HTZWW" on that date. The offering is expected to close on November 12, 2021, subject to the satisfaction of customary closing conditions.
Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, and Morgan Stanley & Co. LLC are acting as lead bookrunning managers for the offering. Barclays Capital Inc. and Deutsche Bank Securities Inc. are acting as additional bookrunners, and Guggenheim Securities, LLC, BTIG, LLC, AmeriVet Securities, Inc., Loop Capital Markets, LLC and Tigress Financial Partners LLC are acting as co-managers for the offering.
A registration statement relating to these securities was declared effective by the Securities and Exchange Commission on November 8, 2021. The offering will be made only by means of a prospectus. Copies of the final prospectus, when available, may be obtained from Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, New York 10282, telephone: 1-866-471-2526, facsimile: 212-902-9316 or email: prospectus-ny@ny.email.gs.com; J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, email at prospectus-eq_fi@jpmorgan.com, or telephone: 1-866-803-9204; or Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY 10014.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
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 operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets and sells vehicles through Hertz Car Sales.
This press release contains "forward-looking statements" within the meaning of federal securities laws. Words such as "expect" and "intend" and similar expressions identify forward-looking statements. We caution you that these statements are not guarantees of future performance and are subject to numerous evolving risks and uncertainties that we may not be able to accurately predict or assess, including those in our risk factors that we identify in our most recent annual report on Form 10-K for the year ended December 31, 2020, as filed with the Securities and Exchange Commission on February 26, 2021, and any updates thereto in the Company’s quarterly reports on Form 10-Q and current reports on Form 8-K. We caution you not to place undue reliance on our forward-looking statements, which speak only as of their date, and we undertake no obligation to update this information.
ESTERO, Fla., Nov. 3, 2021 /PRNewswire/ — Hertz Global Holdings, Inc. (OTCPK:HTZZ) ("Hertz" or the "Company") announced today that it has launched a public offering of its common stock by certain stockholders of Hertz. The selling stockholders are offering 37,100,000 shares of Hertz common stock, of which Hertz intends to repurchase from the underwriters shares having an aggregate purchase price of between $250 million and $500 million (the "Repurchase"). In addition, a selling stockholder intends to grant the underwriters a 30-day option to purchase up to an additional 5,565,000 shares of Hertz common stock. The public offering price is expected to be between $25.00 and $29.00 per share.
Hertz will not receive any proceeds from the sale of shares by the selling stockholders. Hertz expects to fund the Repurchase with cash on hand. The Repurchase is subject to completion of the offering and the satisfaction of other customary conditions.
Hertz has applied to list on The Nasdaq Global Select Market under the ticker symbol "HTZ." Hertz’s common stock currently trades on the over-the-counter market under the symbol "HTZZ."
Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, and Morgan Stanley & Co. LLC are acting as lead bookrunning managers for the proposed offering. Barclays Capital Inc. and Deutsche Bank Securities Inc. are acting as additional bookrunners, and Guggenheim Securities, LLC is acting as co-manager for the proposed offering.
The proposed offering will be made only by means of a prospectus. Copies of the preliminary prospectus, when available, may be obtained from Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, New York 10282, telephone: 1-866-471-2526, facsimile: 212-902-9316 or email: prospectus-ny@ny.email.gs.com; J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, email at prospectus-eq_fi@jpmorgan.com, or telephone: 1-866-803-9204; or Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY 10014.
A registration statement relating to these securities has been filed with the SEC but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
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 operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets and sells vehicles through Hertz Car Sales.
This press release contains "forward-looking statements" within the meaning of federal securities laws. Words such as "expect" and "intend" and similar expressions identify forward-looking statements. We caution you that these statements are not guarantees of future performance and are subject to numerous evolving risks and uncertainties that we may not be able to accurately predict or assess, including those in our risk factors that we identify in our most recent annual report on Form 10-K for the year ended December 31, 2020, as filed with the Securities and Exchange Commission on February 26, 2021, and any updates thereto in the Company’s quarterly reports on Form 10-Q and current reports on Form 8-K. We caution you not to place undue reliance on our forward-looking statements, which speak only as of their date, and we undertake no obligation to update this information.
ESTERO, Fla., Oct. 28, 2021 /PRNewswire/ — Hertz Global Holdings, Inc. (OTCPK: HTZZ; OTCPK: HTZZW) ("Hertz", "Hertz Global" or the "Company") today announced financial results for the third quarter of 2021.
For the third quarter 2021, the Company generated total revenues of $2.2 billion, reflecting the continued rebound in leisure travel and tight fleet inventory as Hertz executes against its strategic roadmap. While volume continued to be lower compared to 2019 levels, these headwinds were partially mitigated by improvements in pricing power. Adjusted Corporate EBITDA reached a record $860 million and the Company achieved a record 39% margin for the third quarter, reflecting the team’s dedication to continued operational improvement since completing the restructuring. Importantly, top- and bottom-line results were not meaningfully impacted in an incremental manner by the Delta Variant.
"Hertz delivered another solid quarter, which puts us in a position of strength as we create the new Hertz and lead the future of mobility and travel," said Mark Fields, Hertz’s Interim Chief Executive Officer. "We see the opportunity for profitable growth by building on our iconic brand and global fleet management expertise, and combining it with new technology and new investments in electrification, shared mobility and a digital, customer-first experience."
AMERICAS RENTAL CAR ("AMERICAS RAC") SUMMARY
Americas RAC
Three Months Ended
September 30,
Percent Inc/(Dec) 2021 vs. 2020
Percent Inc/(Dec) 2021 vs. 2019
($ in millions, except where noted)
2021
2020
2019
Total revenues
$
1,914
$
892
$
2,066
NM
(7)
%
Adjusted EBITDA
$
830
$
(11)
$
298
NM
NM
Adjusted EBITDA Margin
43
%
(1)
%
14
%
Average Vehicles (in whole units)
387,368
389,605
591,327
(1)
%
(34)
%
Vehicle Utilization
78
%
52
%
80
%
Transaction Days (in thousands)
27,627
18,579
43,289
49
%
(36)
%
Total RPD (in whole dollars)(1)
$
69.25
$
48.07
$
47.78
44
%
45
%
Total RPU Per Month (in whole dollars)(1)
$
1,646
$
764
$
1,166
NM
41
%
Depreciation Per Unit Per Month (in whole dollars)
$
21
$
161
$
246
(87)
%
(91)
%
(1)
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues. See the full definition and explanation of these key metrics set forth on page 20 of this release.
NM – Not meaningful
Americas RAC third quarter 2021 revenues reflect upward pricing trends due to management’s structural improvements, positive momentum in domestic travel and industry-wide fleet constraints. Americas RAC record Adjusted EBITDA of $830 million and record margin of 43% reflect the impact of strong pricing, disciplined fleet management and the Company’s execution of cost reductions.
INTERNATIONAL RENTAL CAR ("INTERNATIONAL RAC") SUMMARY
International RAC
Three Months Ended
September 30,
Percent Inc/(Dec) 2021 vs. 2020
Percent Inc/(Dec) 2021 vs. 2019
($ in millions, except where noted)
2021
2020
2019
Total revenues
$
312
$
227
$
598
38
%
(48)
%
Adjusted EBITDA
$
78
$
(34)
$
86
NM
(9)
%
Adjusted EBITDA Margin
25
%
(15)
%
14
%
Average Vehicles (in whole units)
86,124
90,884
188,196
(5)
%
(54)
%
Vehicle Utilization
74
%
67
%
79
%
Transaction Days (in thousands)
5,862
5,587
13,741
5
%
(57)
%
Total RPD (in whole dollars)(1)
$
54.81
$
42.58
$
47.76
29
%
15
%
Total RPU Per Month (in whole dollars)(1)
$
1,244
$
872
$
1,162
43
%
7
%
Depreciation Per Unit Per Month (in whole dollars)
$
147
$
205
$
213
(28)
%
(31)
%
(1)
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues. See the full definition and explanation of these key metrics set forth on page 20 of this release.
NM – Not meaningful
Global travel constraints continue to impact the International RAC business. Management’s structural improvements on pricing mitigated the impact of lower volume compared to the third quarter 2019. The Company’s disciplined fleet management and continued execution on productivity contributed to profitability. International RAC Adjusted EBITDA was $78 million, nearly closing the gap to the third quarter 2019 level.
Q4 AND FULL YEAR 2021 GUIDANCE
The Company’s guidance for the fourth quarter and full year 2021 includes Adjusted Corporate EBITDA, a non-GAAP financial measure. The Company believes it is impracticable to provide a reconciliation to the most comparable GAAP measures due to (i) the forward-looking nature of the adjusted measure, (ii) the degree of uncertainty associated with forecasting the reconciling items and amounts, and (iii) providing estimates of the amounts that would be required to reconcile the forecasted adjusted measure to its forecasted GAAP measure would imply a degree of precision that could be confusing or misleading to investors.
The Company forecasts the following:
Hertz Global
2021
Measure
Q4
Full Year
Adjusted Corporate EBITDA
$500 – $600 million
$2.0 – $2.1 billion
Total Revenue Per Unit Per Month
$1,355 – $1,445
$1,400 – $1,430
Depreciation Per Unit Per Month
$60 – $70
$95 – $105
Liquidity at December 31, 2021
$3.9 – $4.1 billion
$3.9 – $4.1 billion
LIQUIDITY AND CAPITAL RESOURCES
The Company completed its restructuring in June 2021 with significantly lower non-vehicle debt levels relative to its pre-restructuring balance sheet. At September 30, 2021 the Company had $1.5 billion in outstanding non-vehicle debt, comprised of a $1.3 billion Term B Loan and a $245 million Term C Loan that will support the issuance of letters of credit. In addition, the Company has a $1.3 billion first lien revolving credit facility ("First Lien RCF"). At September 30, 2021, the Company had $366 million of letters of credit outstanding and no borrowings outstanding under the First Lien RCF. The Company has no material non-vehicle debt maturities until 2026.
The Company’s liquidity position totaled $3.8 billion at September 30, 2021, comprised of $2.7 billion in unrestricted cash and $1.1 billion of availability under the First Lien RCF.
The Company also refinanced its ABS program with $2.8 billion of committed funding under a 2-year, floating rate syndicated bank sponsored Variable Funding Rental Car Asset Backed Notes, of which $2.3 billion was drawn at September 30, 2021. The Company also issued $4.0 billion in Fixed Rate Rental Car Asset Backed Notes split evenly between 3- and 5-year maturities. The overall cost of the ABS funding in the United States is currently below 2.0%.
ADDITIONAL MANAGEMENT COMMENTARY
Recorded audio commentary on Hertz’s third quarter 2021 results from Mark Fields, Interim CEO, and Kenny Cheung, CFO is available at the Company’s IR website at https://ir.hertz.com/events-presentations.
RESULTS OF THE HERTZ CORPORATION
The Company’s operating subsidiary, The Hertz Corporation ("Hertz Corp."), posted the same revenues as the Company for the third quarter of 2021 and 2020, and for the nine months ended September 30, 2021 and 2020. Hertz Corp.’s third quarter 2021 pre-tax income was $752 million versus the Company’s pre-tax income of $768 million. The difference between Hertz Corp.’s and the Company’s GAAP results is due to a $16 million change in fair value of the Company’s Public Warrants in the third quarter of 2021. For the nine months ended September 30, 2021, Hertz Corp.’s pre-tax income was $968 million versus the Company’s pre-tax income of $820 million. The difference between Hertz Corp.’s and the Company’s GAAP results is due to a $164 million backstop fee associated with a rights offering offered by the Company in the second quarter of 2021 offset by a $16 million change in fair value of the Company’s Public Warrants in the third quarter of 2021. Hertz Corp. and the Company’s pre-tax loss were the same for the third quarter of 2020. For the nine months ended September 30, 2020, Hertz Corp.’s pre-tax loss was $1.8 billion versus the Company’s pre-tax loss of $1.7 billion resulting primarily from Hertz Corp.’s write off in the second quarter of 2020 of $133 million due from the Company. The non-GAAP profitability metrics for Hertz Corp. are materially the same as those for Hertz for the third quarter 2021 and 2020, and for the nine months ended September 30, 2021 and 2020.
SELECTED FINANCIAL DATA, SUPPLEMENTAL SCHEDULES, NON-GAAP MEASURES AND DEFINITIONS
The selected financial data of Hertz are set forth on page 7 of this release. Also included are Supplemental Schedules, which are provided to present segment results, and reconciliations of non-GAAP measures to their most comparable GAAP measures.
In the second quarter of 2021, the Company revised its reportable segments to combine its Canada, Latin America and Caribbean operations with the U.S. and renamed its U.S. Rental Car segment Americas Rental Car ("Americas RAC"). As a result, those operations will no longer be reported in the International RAC segment. Accordingly, prior periods have been recast to conform with the revised presentation. Additionally, in the second quarter of 2021, the Company added a financial statement line item for non-vehicle depreciation and amortization to better align with current industry practice. In the third quarter of 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues to better align with current industry practice. For the revisions noted above, prior periods have been restated to conform with the revised presentation. Refer also to Supplemental Schedule IV.
Following the Supplemental Schedules, the Company provides definitions for terminology used throughout this earnings release and provides the usefulness of non-GAAP measures to investors and additional purposes for which management uses such measures.
Financial data included in this release are derived from our unaudited condensed consolidated financial statements for the three months ended September 30, 2021, which are included in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 filed with the SEC and on the Hertz website, IR.Hertz.com. We have prepared the unaudited condensed consolidated financial statements on the same basis as we have prepared our audited consolidated financial statements. The unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, that management considered necessary for a fair statement of our financial position, results of operations and cash flows for the quarter. The Company’s historical results are not necessarily indicative of the results to be expected for any future period. Financial data included in this release are qualified by reference to and should be read in conjunction with the Company’s unaudited condensed consolidated financial statements and related notes which are included in its Quarterly Report on Form 10-Q for the quarter ended September 30, 2021.
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 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.
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 include information concerning the Company’s liquidity and its possible or assumed future results of operations, including descriptions of its business strategies. These statements often include words such as "believe," "expect," "project," "potential," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts," "guidance" or similar expressions. These 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 it believes are appropriate in these circumstances. The Company believes these judgments are reasonable, but you should understand that these statements are not guarantees of 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 on Form 10-K, 10-Q and 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: the impact of the Company’s recent emergence from Chapter 11 on the Company’s business and relationships; levels of travel demand, particularly with respect to business and leisure travel in the U.S. and in global markets; the length and severity of COVID-19 and the impact on the Company’s vehicle rental business as a result of travel restrictions and business closures or disruptions; the impact of COVID-19 and actions taken in response to the pandemic on global and regional economies and economic factors; general economic uncertainty and the pace of economic recovery, including in key global markets, when COVID-19 subsides; the Company’s ability to implement its business strategy including its ability to implement plans to support a large scale electric vehicle fleet and to play a central role in the modern mobility ecosystem; the Company’s ability to attract and retain key personnel following its emergence from bankruptcy; the Company’s ability to utilize its net operating loss carryforwards and built-in-losses as a result of its emergence from bankruptcy; the Company’s ability to remediate the material weaknesses in its internal controls over financial reporting; the Company’s ability to maintain an effective employee retention and talent management strategy and resulting changes in personnel and employee relations; the recoverability of the Company’s goodwill and indefinite-lived intangible assets when performing impairment analysis; the Company’s ability to dispose of vehicles in the used-vehicle market, use the proceeds of such sales to acquire new vehicles and to reduce exposure to residual risk; actions creditors may take with respect to the vehicles used in the rental car operations; significant changes in the competitive environment and the effect of competition in the Company’s markets on rental volume and pricing; occurrences that disrupt rental activity during the Company’s peak periods; the Company’s ability to accurately estimate future levels of rental activity and adjust the number and mix of vehicles used in the Company’s rental operations accordingly; the Company’s ability to retain and increase customer loyalty and market share; increased vehicle costs due to declining value of the Company’s non-program vehicles; the Company’s ability to maintain sufficient liquidity and the availability to it of additional or continued sources of financing for the Company’s revenue earning vehicles and to refinance its existing indebtedness; risks related to the Company’s indebtedness, including its present level of debt, its ability to incur substantially more debt, the fact that substantially all of the Company’s consolidated assets secure certain of its outstanding indebtedness and increases in interest rates or in its borrowing margins; the Company’s ability to meet the financial and other covenants contained in its First Lien Credit Agreement and certain asset-backed and asset-based arrangements; the Company’s ability to access financial markets, including the financing of its vehicle fleet through the issuance of asset-backed securities; fluctuations in interest rates, foreign currency exchange rates and commodity prices; the Company’s ability to sustain operations during adverse economic cycles and unfavorable external events (including war, escalation of hostilities, terrorist acts, natural disasters and epidemic disease); the Company’s ability to prevent the misuse or theft of information it possesses, including as a result of cyber security breaches and other security threats; the Company’s ability to adequately respond to changes in technology, customer demands and market competition; the Company’s ability to successfully implement any strategic transactions; the Company’s ability to achieve anticipated cost savings from on-going strategic initiatives; the impact on the value of or interest earned on, any LIBOR-based marketable securities, fleet leases, loans and derivatives as a result of changes to the LIBOR reference rate; the Company’s ability to purchase adequate supplies of competitively priced vehicles at a reasonable cost as a result of the continuing global chip manufacturing shortage and other raw material supply constraints; the impact of the global chip shortage and other raw material supply constraints on asset acquisition costs, resulting depreciation expense and ultimately the residual values on the disposition of vehicles in the Company’s fleet; the Company’s recognition of previously deferred tax gains on the disposition of revenue earning vehicles; financial instability of the manufacturers of the Company’s vehicles, which could impact their ability to fulfill obligations under repurchase or guaranteed depreciation programs; an increase in the Company’s vehicle costs or disruption to the Company’s rental activity, particularly during peak periods, due to safety recalls by the manufacturers of the Company’s vehicles; the Company’s ability to execute a business continuity plan; the Company’s access to third-party distribution channels and related prices, commission structures and transaction volumes; 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; a major disruption in the Company’s communication or centralized information networks; a failure to maintain, upgrade and consolidate the Company’s information technology systems; costs and risks associated with potential litigation and investigations or any failure or inability to comply with laws and regulations or any changes in the legal and regulatory environment; the Company’s ability to maintain its network of leases and vehicle rental concessions at airports in the U.S. and internationally; the Company’s ability to maintain favorable brand recognition and a coordinated branding and portfolio strategy; changes in the existing, or the adoption of new laws, regulations, policies or other activities of governments, agencies and similar organizations, where such actions may affect the Company’s operations, the cost thereof or applicable tax rates; risks relating to the Company’s deferred tax assets, including the risk of an "ownership change" under the Internal Revenue Code of 1986, as amended; the Company’s exposure to uninsured claims in excess of historical levels and inability to collect on subrogation claims; risks relating to the Company’s participation in multiemployer pension plans; shortages of fuel and increases or volatility in fuel costs; the Company’s ability to manage its relationships with unions; changes in accounting principles, or their application or interpretation, and the Company’s ability to make accurate estimates and the assumptions underlying the estimates; and other risks and uncertainties described from time to time in periodic and current reports that it files with the SEC.
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.
FINANCIAL INFORMATION AND OPERATING DATA
SELECTED UNAUDITED CONSOLIDATED INCOME STATEMENT DATA
Three Months Ended
September 30,
As a Percentage of Total Revenues
Nine Months Ended September 30,
As a Percentage of Total Revenues
(In millions, except per share data)
2021
2020
2021
2020
2021
2020
2021
2020
Total revenues
$
2,226
$
1,268
100
%
100
%
$
5,387
$
4,023
100
%
100
%
Expenses:
Direct vehicle and operating
1,131
779
51
%
61
%
2,855
2,624
53
%
65
%
Depreciation of revenue earning vehicles and lease charges
61
347
3
%
27
%
420
1,632
8
%
41
%
Depreciation and amortization of non-vehicle assets
49
58
2
%
5
%
153
168
3
%
4
%
Selling, general and administrative
177
138
8
%
11
%
498
506
9
%
13
%
Interest expense, net:
Vehicle
41
110
2
%
9
%
243
360
5
%
9
%
Non-vehicle
22
17
1
%
1
%
157
118
3
%
3
%
Total interest expense, net
63
127
3
%
10
%
400
478
7
%
12
%
Technology-related intangible and other asset impairments
—
—
—
%
—
%
—
193
—
%
5
%
Other (income) expense, net
(7)
—
—
%
—
%
(20)
(15)
—
%
—
%
Reorganization items, net
—
78
—
%
6
%
677
101
13
%
3
%
(Gain) from the sale of a business
—
—
—
%
—
%
(400)
—
(7)
%
—
%
Change in fair value of Public Warrants
(16)
—
(1)
%
—
%
(16)
—
—
%
—
%
Total expenses
1,458
1,527
65
%
NM
4,567
5,687
85
%
NM
Income (loss) before income taxes
768
(259)
35
%
(20)
%
820
(1,664)
15
%
(41)
%
Income tax (provision) benefit
(160)
36
(7)
%
3
%
(193)
232
(4)
%
6
%
Net income (loss)
608
(223)
27
%
(18)
%
627
(1,432)
12
%
(36)
%
Net (income) loss attributable to noncontrolling interests
(3)
1
—
%
—
%
(1)
7
—
%
—
%
Net income (loss) attributable to Hertz Global
605
(222)
27
%
(18)
%
626
(1,425)
12
%
(35)
%
Dividends on Series A Preferred Stock
(34)
—
(2)
%
—
%
(34)
—
(1)
%
—
%
Net income (loss) available to Hertz Global common stockholders
$
571
$
(222)
26
%
(18)
%
$
592
$
(1,425)
11
%
(35)
%
Weighted-average number of shares outstanding:
Basic
471
156
264
148
Diluted
490
156
270
148
Earnings (loss) per share:
Basic
$
1.21
$
(1.42)
$
2.25
$
(9.65)
Diluted
$
1.13
$
(1.42)
$
2.14
$
(9.65)
Adjusted Net Income (Loss)(a)
$
587
$
(68)
$
945
$
(827)
Adjusted Diluted Earnings (Loss) Per Share(a)
$
1.20
$
(0.44)
$
3.50
$
(5.60)
Adjusted Corporate EBITDA(a)
$
860
$
(26)
$
1,502
$
(855)
NM – Not meaningful
(a) Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule II.
Supplemental Schedule I
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
Three Months Ended September 30, 2021
Three months ended September 30, 2020
(In millions)
Americas RAC
International RAC
All other operations
Corporate
Hertz Global
Americas RAC
International RAC
All other operations
Corporate
Hertz Global
Total revenues:
$
1,914
$
312
$
—
$
—
$
2,226
$
892
$
227
$
149
$
—
$
1,268
Expenses:
Direct vehicle and operating
960
173
—
(2)
1,131
622
155
5
(3)
779
Depreciation of revenue earning vehicles and lease charges
24
37
—
—
61
188
53
106
—
347
Depreciation and amortization of non-vehicle assets
42
3
—
4
49
47
5
2
4
58
Selling, general and administrative
72
27
—
78
177
46
54
$
6
32
138
Interest expense, net:
Vehicle
33
8
—
—
41
79
19
12
—
110
Non-vehicle
(4)
2
—
24
22
(1)
1
1
16
17
Total interest expense, net
29
10
—
24
63
78
20
13
16
127
Technology-related intangible and other asset impairments
—
—
—
—
—
—
—
—
—
—
Other (income) expense, net
(2)
(1)
—
(4)
(7)
—
—
—
—
—
Reorganization items, net
—
—
—
—
—
1
—
—
77
78
(Gain) from the sale of a business
—
—
—
—
—
—
—
—
—
—
Change in fair value of Public Warrants
—
—
—
(16)
(16)
—
—
—
—
—
Total expenses
1,125
249
—
84
1,458
982
287
132
126
1,527
Income (loss) before income taxes
$
789
$
63
$
—
$
(84)
768
$
(90)
$
(60)
$
17
$
(126)
(259)
Income tax (provision) benefit
(160)
36
Net income (loss)
608
(223)
Net (income) loss attributable to noncontrolling interests
(3)
1
Net income (loss) attributable to Hertz Global
605
(222)
Preferred stock dividend accretion
(34)
—
Net income (loss) attributable to Hertz Global common stockholders
$
571
$
(222)
Supplemental Schedule I (continued)
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
Nine Months Ended September 30, 2021
Nine Months Ended September 30, 2020
(In millions)
Americas RAC
International RAC
All other operations
Corporate
Hertz Global
Americas RAC
International RAC
All other operations
Corporate
Hertz Global
Total revenues:
$
4,524
$
727
$
136
$
—
$
5,387
$
2,857
$
678
$
488
$
—
$
4,023
Expenses:
Direct vehicle and operating
2,394
452
5
4
2,855
2,113
503
13
(5)
2,624
Depreciation of revenue earning vehicles and lease charges
314
106
—
—
420
1,080
200
352
—
1,632
Depreciation and amortization of non-vehicle assets
130
12
2
9
153
136
14
7
11
168
Selling, general and administrative
191
97
10
200
498
229
130
12
135
506
Interest expense, net:
Vehicle
182
49
12
—
243
265
61
34
—
360
Non-vehicle
(9)
3
1
162
157
(69)
(1)
(7)
195
118
Total interest expense, net
173
52
13
162
400
196
60
27
195
478
Technology-related intangible and other asset impairments
—
—
—
—
—
—
—
—
193
193
Other (income) expense, net
(8)
(2)
—
(10)
(20)
(22)
4
—
3
(15)
Reorganization items, net
80
12
(1)
586
677
1
—
—
100
101
(Gain) from the sale of a business
—
—
—
(400)
(400)
—
—
—
—
—
Change in fair value of Public Warrants
—
—
—
(16)
(16)
—
—
—
—
—
Total expenses
3,274
729
29
535
4,567
3,733
911
411
632
5,687
Income (loss) before income taxes
$
1,250
$
(2)
$
107
$
(535)
820
$
(876)
$
(233)
$
77
$
(632)
(1,664)
Income tax (provision) benefit
(193)
232
Net income (loss)
627
(1,432)
Net (income) loss attributable to noncontrolling interests
(1)
7
Net income (loss) attributable to Hertz Global
626
(1,425)
Preferred stock dividend accretion
(34)
—
Net income (loss) attributable to Hertz Global common stockholders
$
592
$
(1,425)
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 September 30,
Nine Months Ended September 30,
(In millions, except per share data)
2021
2020
2021
2020
Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share:
Net income (loss) attributable to Hertz Global
$
605
$
(222)
$
626
$
(1,425)
Dividends on Series A Preferred Stock
(34)
—
(34)
—
Net income (loss) available to Hertz Global common stockholders, basic
571
(222)
592
(1,425)
Adjustments:
Income tax provision (benefit)
160
(36)
193
(232)
Vehicle and non-vehicle debt-related charges(a)(n)
12
13
116
43
Technology-related intangible and other asset impairments(b)
—
—
—
193
Restructuring and restructuring related charges(c)
22
7
72
54
Information technology and finance transformation costs(d)
3
8
13
34
Acquisition accounting-related depreciation and amortization(e)
12
14
37
41
Reorganization items, net(f)
—
78
677
101
Pre-reorganization and non-debtor financing charges(g)
1
44
41
89
Gain from the Donlen Sale(h)
—
—
(400)
—
Change in fair value of Public Warrants
(16)
—
(16)
—
Other items(i)(q)
7
4
(81)
(1)
Adjusted pre-tax income (loss)(j)
772
(90)
1,244
(1,103)
Income tax (provision) benefit on adjusted pre-tax income (loss)(k)
(185)
22
(299)
276
Adjusted Net Income (Loss)
$
587
$
(68)
$
945
$
(827)
Weighted-average number of diluted shares outstanding
490
156
270
148
Adjusted Diluted Earnings (Loss) Per Share(l)
$
1.20
$
(0.44)
$
3.50
$
(5.60)
Adjusted Corporate EBITDA:
Net income (loss) attributable to Hertz Global
$
605
$
(222)
626
(1,425)
Adjustments:
Income tax provision (benefit)
160
(36)
193
(232)
Non-vehicle depreciation and amortization(m)
49
58
153
168
Non-vehicle debt interest, net of interest income(n)
22
17
157
118
Vehicle debt-related charges(a)(o)
8
13
62
37
Technology-related intangible and other asset impairments(b)
—
—
—
193
Restructuring and restructuring related charges(c)
22
7
72
54
Information technology and finance transformation costs(d)
3
8
13
34
Reorganization items, net(f)
—
78
677
101
Pre-reorganization and non-debtor financing charges(g)
1
44
41
89
Gain from the Donlen Sale(h)
—
—
(400)
—
Change in fair value of Public Warrants
(16)
—
(16)
—
Other items(i)(p)
6
7
(76)
8
Adjusted Corporate EBITDA
$
860
$
(26)
$
1,502
$
(855)
Supplemental Schedule II (continued)
(a)
Represents debt-related charges relating to the amortization of deferred financing costs and debt discounts and premiums.
(b)
In 2020, represents the impairment of technology-related intangible assets and capitalized cloud computing implementation costs. These costs relate to the Company’s corporate operations ("Corporate").
(c)
Represents charges incurred under restructuring actions as defined in U.S. GAAP. Also includes restructuring related charges such as incremental costs incurred directly supporting business transformation initiatives.
(d)
Represents costs associated with the Company’s information technology and finance transformation programs, both of which are multi-year initiatives to upgrade and modernize the Company’s systems and processes. These costs relate primarily to the Corporate.
(e)
Represents incremental expense associated with the amortization of other intangible assets and depreciation of property and equipment relating to acquisition accounting.
(f)
Represents charges incurred associated with the Reorganization and emergence from chapter 11, including professional fees. The charges relate primarily to Corporate. Hertz Corporation reorganization expenses for the nine months ended September 30, 2021 was $513 million, respectively. The difference is due to a $164 million Backstop fee.
Three Months Ended September 30,
Nine Months Ended
September 30,
(In millions)
2021
2020
2021
2020
Professional fees and other bankruptcy related costs
$
—
$
78
$
257
$
101
Loss on extinguishment of debt
—
—
191
—
Backstop fee
—
—
164
—
Breakup fee
—
—
77
—
Contract settlements
—
—
25
—
Cancellation of share-based compensation grants
—
—
(10)
—
Net gain on settlement of liabilities subject to compromise
—
—
(22)
—
Other, net
—
—
(5)
—
Reorganization items, net
$
—
$
78
$
677
$
101
(g)
Represents charges incurred prior to the filing of the Chapter 11 Cases comprised of preparation charges for the Reorganization, such as professional fees. Also includes, certain non-debtor financing and professional fee charges. For the three months ended September 30, 2021, $1 million incurred by Corporate, and for the nine months ended September charges incurred were $17 million, $17 million, $5 million and $2 million in Corporate, Americas RAC, International RAC and All other operations, respectively. For Americas RAC, International RAC, Corporate and All other operations charges incurred for the three months ended September 30, 2020 are $18 million, $14 million, $9 million and $3 million, respectively, and for the nine months ended September 30, 2020 are $33 million, $16 million, $37 million and $3 million, respectively.
(h)
Represents the gain from the sale of the Company’s Donlen business on March 30, 2021, primarily associated with Corporate.
(i)
Represents miscellaneous items. In 2021, includes $100 million due to the suspension of depreciation during the first half of the year for the Donlen leasing and fleet management operations while classified as held for sale in All other operations, partially offset by letter of credit fees recorded in the first half of the year in Corporate and charges for a multiemployer pension plan withdrawal liability recorded in the first quarter in Corporate. In 2020, includes a $20 million gain on the sale of non-vehicle capital assets in Americas RAC, which was recorded in the first quarter, partially offset by second quarter charges of $18 million for losses associated with certain vehicle damages in Americas RAC.
(j)
Adjustments by caption on a pre-tax basis were as follows:
Increase (decrease) to expenses
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)
2021
2020
2021
2020
Direct vehicle and operating
$
(14)
$
(14)
$
45
$
(83)
Selling, general and administrative
(22)
(38)
(91)
(104)
Interest expense, net:
Vehicle
(8)
(34)
(81)
(73)
Non-vehicle
(4)
—
(54)
(6)
Total interest expense, net
(12)
$
(34)
$
(135)
(79)
Intangible and other asset impairments
—
—
—
(193)
Other income (expense), net
(9)
(4)
(17)
6
Reorganization items, net
—
(78)
(677)
(101)
Gain from the Donlen Sale
—
—
400
—
Change in fair value of Public Warrants
$
16
$
—
$
16
$
—
Total adjustments
$
(41)
$
(168)
$
(459)
$
(554)
(k)
Derived utilizing a combined statutory rate of 24% and 25% for the three and nine months ended September 30, 2021 and 2020, respectively, applied to the respective Adjusted Pre-tax Income (Loss).
(l)
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.
(m)
Non-vehicle depreciation and amortization expense for Americas RAC, International RAC and Corporate for the three months ended September 30, 2021 was $42 million, $3 million and $4 million, respectively. For the three months ended September 30, 2020 was $47 million, $5 million, $2 million and $4 million for Americas RAC, International RAC, All other operations and Corporate, respectively. Non-vehicle depreciation and amortization for Americas RAC, International RAC, All other operations and Corporate for the nine months ended September 30, 2021 were $130 million, $12 million, $2 million and $9 million, respectively, and for the nine months ended September 30, 2020 were $136 million, $14 million, $7 million and $11 million, respectively.
(n)
In 2021, includes $8 million of loss on extinguishment of debt associated with the payoff and termination of non-vehicle debt in Corporate in the second quarter of 2021.
(o)
Vehicle debt-related charges for Americas RAC and International RAC for the three months ended September 30, 2021 were $6 million and $2 million, respectively. For the three months ended September 30, 2020 vehicle debt-related charges for Americas RAC, International RAC and All other operations were $9 million, $3 million and $1 million, respectively. Vehicle debt-related charges for Americas RAC, International RAC and All other operations for the nine months ended September 30, 2021 were $48 million, $12 million and $2 million, respectively, and for the nine months ended September 30, 2020 were $23 million, $11 million and $3 million, respectively.
(p)
Also includes an adjustment for non-cash stock-based compensation charges in Corporate.
(q)
Also includes letter of credit fees recorded in the third quarter of 2021 in Corporate.
Supplemental Schedule III
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF KEY METRICS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
Americas RAC
Three Months Ended
September 30,
Percent Inc/(Dec)
Nine Months Ended
September 30,
Percent Inc/(Dec)
($ in millions, except where noted)
2021
2020
2021
2020
Total RPD
Total revenues
$
1,914
$
892
$
4,524
$
2,857
Foreign currency adjustment(a)
(1)
1
(2)
2
Total Revenues – ajusted for foreign currency
$
1,913
$
893
$
4,522
$
2,859
Transaction Days (in thousands)
27,627
18,579
72,870
64,262
Total RPD (in whole dollars)(c)
$
69.25
$
48.07
44
%
$
62.06
$
44.49
39
%
Total Revenue Per Unit Per Month
Total Revenues – adjusted for foreign currency
$
1,913
$
893
$
4,522
$
2,859
Average Vehicles (in whole units)
387,368
389,605
346,032
480,700
Total revenue per unit (in whole dollars)
$
4,938
$
2,292
$
13,068
$
5,948
Number of months in period (in whole units)
3
3
9
9
Total RPU Per Month (in whole dollars)(c)
$
1,646
$
764
NM
$
1,452
$
661
NM
Vehicle Utilization
Transaction Days (in thousands)
27,627
18,579
72,870
64,262
Average Vehicles (in whole units)
387,368
389,605
346,032
480,700
Number of days in period (in whole units)
92
92
273
274
Available Car Days (in thousands)
35,638
35,844
94,467
131,712
Vehicle Utilization(b)
78
%
52
%
77
%
49
%
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease charges
$
24
$
188
$
314
$
1,080
Foreign currency adjustment(a)
—
—
—
1
Adjusted depreciation of revenue earning vehicles and lease charges
24
188
314
1,081
Average Vehicles (in whole units)
387,368
389,605
346,032
480,700
Depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars)
$
62
$
483
$
907
$
2,249
Number of months in period (in whole units)
3
3
9
9
Depreciation Per Unit Per Month (in whole dollars)
$
21
$
161
(87)
%
$
101
$
250
(60)
%
NM – Not meaningful
(a)
Based on December 31, 2020 foreign exchange rates
(b)
Calculated as Transaction Days divided by Available Car Days.
(c)
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues. See the full definition and explanation of these key metrics set forth on page 20 of this release.
Supplemental Schedule III (continued)
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF KEY METRICS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
International RAC
Three Months Ended
September 30,
Percent Inc/(Dec)
Nine Months Ended
September 30,
Percent Inc/(Dec)
($ in millions, except where noted)
2021
2020
2021
2020
Total RPD
Total revenues
$
312
$
227
$
727
$
678
Foreign currency adjustment(a)
9
11
11
60
Total Revenues – adjusted for foreign currency
$
321
$
238
$
738
$
738
Transaction Days (in thousands)
5,862
5,587
15,153
17,551
Total RPD (in whole dollars)(c)
$
54.81
$
42.58
29
%
$
48.68
$
42.12
16
%
Total Revenue Per Unit Per Month
Total Revenues – adjusted for foreign currency
$
321
$
238
$
738
$
738
Average Vehicles (in whole units)
86,124
90,884
74,721
112,445
Total revenue per unit (in whole dollars)
$
3,727
$
2,619
$
9,877
$
6,563
Number of months in period (in whole units)
3
3
9
9
Total RPU Per Month (in whole dollars)(c)
$
1,244
$
872
43
%
$
1,097
$
730
50
%
Vehicle Utilization
Transaction Days (in thousands)
5,862
5,587
15,153
17,551
Average Vehicles (in whole units)
86,124
90,884
74,721
112,445
Number of days in period (in whole units)
92
92
273
274
Available Car Days (in thousands)
7,923
8,361
20,399
30,810
Vehicle Utilization(b)
74
%
67
%
74
%
57
%
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease charges
$
37
$
53
$
106
$
200
Foreign currency adjustment(a)
1
3
2
20
Adjusted depreciation of revenue earning vehicles and lease charges
$
38
$
56
$
108
$
220
Average Vehicles (in whole units)
86,124
90,884
74,721
112,445
Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars)
$
441
$
616
$
1,445
$
1,957
Number of months in period (in whole units)
3
3
9
9
Depreciation Per Unit Per Month (in whole dollars)
$
147
$
205
(28)
%
$
161
$
217
(26)
%
(a)
Based on December 31, 2020 foreign exchange rates
(b)
Calculated as Transaction Days divided by Available Car Days.
(c)
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues. See the full definition and explanation of these key metrics set forth on page 20 of this release.
Supplemental Schedule III (continued)
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF KEY METRICS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
Worldwide Rental Car
Three Months Ended
September 30,
Percent Inc/(Dec)
Nine Months Ended
September 30,
Percent Inc/(Dec)
($ in millions, except where noted)
2021
2020
2021
2020
Total RPD
Total revenues
$
2,226
$
1,119
$
5,251
$
3,535
Foreign currency adjustment(a)
8
12
9
62
Total Revenues – adjusted for foreign currency
$
2,234
$
1,131
$
5,260
$
3,597
Transaction Days (in thousands)
33,489
24,166
88,023
81,813
Total RPD (in whole dollars)(c)
$
66.72
$
46.80
43
%
$
59.75
$
43.98
36
%
Total Revenue Per Unit Per Month
Total Revenues – adjusted for foreign currency
$
2,234
$
1,131
$
5,260
$
3,597
Average Vehicles (in whole units)
473,492
480,489
420,753
593,145
Total revenue per unit (in whole dollars)
$
4,718
$
2,354
$
12,501
$
6,064
Number of months in period (in whole units)
3
3
9
9
Total RPU Per Month (in whole dollars)(c)
$
1,573
$
785
100
%
$
1,389
$
674
NM
Vehicle Utilization
Transaction Days (in thousands)
33,489
24,166
88,023
81,813
Average Vehicles (in whole units)
473,492
480,489
420,753
593,145
Number of days in period (in whole units)
92
92
273
274
Available Car Days (in thousands)
43,561
44,205
114,866
162,522
Vehicle Utilization(b)
77
%
55
%
77
%
50
%
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease charges
$
61
$
241
$
420
$
1,280
Foreign currency adjustment(a)
1
3
2
21
Adjusted depreciation of revenue earning vehicles and lease charges
$
62
$
244
$
422
$
1,301
Average Vehicles (in whole units)
473,492
480,489
420,753
593,145
Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars)
$
131
$
508
$
1,003
$
2,193
Number of months in period (in whole units)
3
3
9
9
Depreciation Per Unit Per Month (in whole dollars)
$
44
$
169
(74)
%
$
111
$
244
(55)
%
Note: Worldwide Rental Car represents Americas RAC and International RAC segment information on a combined basis and excludes All other operations, which is primarily comprised of the Company’s former Donlen leasing operations, and Corporate.
(a)
Based on December 31, 2020 foreign exchange rates.
(b)
Calculated as Transaction Days divided by Available Car Days.
(c)
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues. See the full definition and explanation of these key metrics set forth on page 20 of this release.
Supplemental Schedule IV
HERTZ GLOBAL HOLDINGS, INC.
RECAST OF HISTORICAL SEGMENT FINANCIAL INFORMATION AND KEY METRICS
Unaudited
Three Months Ended September 30, 2020
(In millions)
U.S. RAC
Adjustments(a)
Americas RAC
International RAC
(historical segmentation)
Adjustments(a)
International RAC (new segmentation)
Total revenues:
$
866
$
26
$
892
$
253
$
(26)
$
227
Expenses:
Direct vehicle and operating
648
(26)
622
179
(24)
155
Depreciation of revenue earning vehicles and lease charges
182
6
188
59
(6)
53
Depreciation and amortization of non-vehicle assets
—
47
47
—
5
5
Selling, general and administrative
46
—
46
56
(2)
54
Interest expense, net:
Vehicle
77
2
79
21
(2)
19
Non-vehicle
(1)
—
(1)
1
—
1
Total interest expense, net
76
2
78
22
(2)
20
Technology-related intangible and other asset impairments
—
—
—
—
—
—
(Gain) from the sale of a business
—
—
—
—
—
—
Other (income) expense, net
—
—
—
—
—
—
Reorganization items, net
1
—
1
—
—
—
Total expenses
953
29
982
316
(29)
287
Income (loss) before income taxes
$
(87)
$
(3)
$
(90)
$
(63)
$
3
$
(60)
Adjusted EBITDA
$
(10)
$
(1)
$
(11)
$
(35)
$
1
$
(34)
Adjusted EBITDA Margin
(1)
%
(4)
%
(1)
%
(14)
%
(4)
%
(15)
%
0
Average Vehicles (in whole units)
376,443
13,162
389,605
104,045
(13,162)
90,884
Vehicle Utilization
52
%
50
%
52
%
65
%
(50)
%
67
%
Transaction Days (in thousands)
17,971
607
18,579
6,194
(607)
5,587
Total RPD (in whole dollars)(b)(c)
$
46.27
$
46.45
$
48.07
$
42.78
$
(44.60)
$
42.58
Total RPU Per Month (in whole dollars)(b)(c)
$
736
$
715
$
764
$
849
$
(686)
$
872
Depreciation Per Unit Per Month (in whole dollars)(b)
$
161
$
146
$
161
$
197
$
(146)
$
205
(a)
Reflects the adjustments related to (i) the revision of the Company’s reportable segments to include Canada, Latin America and the Caribbean in its Americas RAC segment, (ii) the callout of non-vehicle depreciation and amortization on a separate line in the income statement, and (iii) the inclusion of ancillary retail vehicle sales revenues as discussed below.
(b)
Based on December 31, 2020 foreign exchange rates.
(c)
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues. See the full definition and explanation of these key metrics set forth on page 20 of this release.
Supplemental Schedule IV (continued)
HERTZ GLOBAL HOLDINGS, INC.
RECAST OF HISTORICAL SEGMENT FINANCIAL INFORMATION AND KEY METRICS
Unaudited
Three Months Ended September 30, 2019
(In millions)
U.S. RAC
Adjustments(a)
Americas RAC
International RAC (historical segmentation)
Adjustments(a)
International RAC (new segmentation)
Total revenues:
$
1,962
$
104
$
2,066
$
702
$
(104)
$
598
Expenses:
Direct vehicle and operating
1,099
14
1,113
386
(57)
329
Depreciation of revenue earning vehicles and lease charges
420
17
437
126
(17)
109
Depreciation and amortization of non-vehicle assets
—
40
40
—
6
6
Selling, general and administrative
125
2
127
60
(5)
55
Interest expense, net:
Vehicle
93
3
96
27
(3)
24
Non-vehicle
(49)
1
(48)
(1)
(1)
(2)
Total interest expense, net
44
4
48
26
(4)
22
Technology-related intangible and other asset impairments
—
—
—
—
—
—
(Gain) from the sale of a business
—
—
—
—
—
—
Other (income) expense, net
(3)
—
(3)
1
—
1
Reorganization items, net
—
—
—
—
—
—
Total expenses
1,685
77
1,762
599
(77)
522
Income (loss) before income taxes
$
277
$
27
$
304
$
103
$
(27)
$
76
Adjusted EBITDA
$
269
$
29
$
298
$
115
$
(29)
$
86
Adjusted EBITDA Margin
14
%
28
%
14
%
16
%
28
%
14
%
Average Vehicles (in whole units)
566,229
25,098
591,327
213,294
(25,098)
188,196
Vehicle Utilization
79
%
82
%
80
%
80
%
(82)
%
79
%
Transaction Days (in thousands)
41,399
1,890
43,289
15,631
(1,890)
13,741
Total RPD (in whole dollars)(b)(c)
$
46.67
$
56.97
$
47.78
$
48.79
$
(56.28)
$
47.76
Total RPU Per Month (in whole dollars)(b)(c)
$
1,137
$
1,024
$
1,166
$
1,192
$
(1,008)
$
1,162
Depreciation Per Unit Per Month (in whole dollars)(b)
$
247
$
223
$
246
$
215
$
(223)
$
213
(a)
Reflects the adjustments related to (i) the revision of the Company’s reportable segments to include Canada, Latin America and the Caribbean in its Americas RAC segment, (ii) the callout of non-vehicle depreciation and amortization on a separate line in the income statement, and (iii) the inclusion of ancillary retail vehicle sales revenues as discussed below.
(b)
Based on December 31, 2020 foreign exchange rates.
(c)
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD and Total RPU to include ancillary retail vehicle sales revenues. See the full definition and explanation of these key metrics set forth on page 20 of this release.
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 Diluted EPS")
Adjusted Net Income (Loss) represents income or loss attributable to the Company as adjusted to eliminate the impact of GAAP income tax, debt-related charges and losses, restructuring and restructuring related charges, intangible and tangible asset impairments and write-downs, information technology and finance transformation costs, non-cash acquisition accounting charges, reorganization items, pre-reorganization and non-debtor financing charges, gain from the sale of a business 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 Diluted 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 Diluted 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, net non-vehicle debt interest, vehicle debt-related charges and losses, restructuring and restructuring related charges, goodwill, intangible and tangible asset impairments and write-downs, information technology and finance transformation costs, reorganization items, pre-reorganization and non-debtor financing charges, gain from the sale of a business 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.
KEY METRICS
Available Car Days
Available Car Days represents Average 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.
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. Management believes eliminating the effect of fluctuations in foreign currency exchange rates is appropriate 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 Revenues – adjusted for foreign currency
Total Revenues – adjusted for foreign currency represents total revenues, with all periods adjusted to eliminate the effect of fluctuations in foreign currency exchange rates. Management believes eliminating the effect of fluctuations in foreign currency exchange rates is appropriate so as not to affect the comparability of underlying trends. This metric is important to management and investors as it represents a measure that 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 the ratio of Total Revenues – adjusted for foreign currency to Transaction Days. 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.
Effective during the three months ended September 30, 2021, the Company revised its calculation of Total RPD to include ancillary retail vehicle sales revenues to better align with current industry practice, where prior periods have been restated to conform with the revised definition.
Total Revenue Per Unit Per Month ("Total RPU" or "RPU")
Total RPU Per Month represents the amount of average Total Revenues – adjusted for foreign currency per vehicle per month. This metric is important to management and investors as it provides a measure of revenue productivity relative to fleet capacity, 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 Car Days. This metric is important to management and investors as it measures the proportion of vehicles that are being used to generate revenues relative to fleet capacity.
ESTERO, Fla. and PHOENIX, Oct. 27, 2021 /PRNewswire/ — Hertz and Carvana today announced a way for customers to save time and money through online car buying and shopping. The two are partnering nationally – following a pilot in September – to enable Hertz to utilize Carvana’s online transaction technology and logistics network to expand vehicle disposition channels.
The rental car industry – which buys and sells millions of vehicles annually – is an integral part of the used car market. Historically, Hertz has sold vehicles from its rental fleet through auctions, direct-to-dealer programs and its retail network of 68 Hertz Car Sales locations. Using Carvana’s technology and logistics network will allow a more efficient direct-to-consumer sales channel, giving Hertz the opportunity to reduce its reliance on wholesale disposition. The partnership with Carvana is of particular importance to Hertz as the company embarks on an ambitious effort to transform its fleet and the rental car industry.
"Our new partnership with Carvana will help Hertz provide a tech-enabled and scalable channel through the lifecycle of our fleet," said Mark Fields, Hertz interim CEO. "This is another step toward the new Hertz – combining our brand strength and global fleet expertise with new technology and innovations to chart a dynamic, new course for the future of travel, mobility and the auto industry."
"Carvana’s technology and infrastructure enable this partnership to bring online car buying experiences to more customers," said Ernie Garcia, Carvana Founder and CEO. "Our nationwide first-party logistics network allows Hertz to expand its retail reach beyond its physical stores and into over 300 markets across the country."
Carvana offers its customers an intuitive and convenient online car buying, selling and financing experience. Carvana enables consumers to quickly and easily shop more than 45,000 vehicles, finance, trade in or sell their current vehicle to Carvana, sign contracts and schedule as-soon-as-next-day delivery or pickup at one of Carvana’s patented, automated Car Vending Machines.
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 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.
Founded in 2012 and based in Phoenix, Carvana’s (NYSE: CVNA) mission is to change the way people buy and sell cars. By removing the traditional dealership infrastructure and replacing it with technology and exceptional customer service, Carvana offers consumers an intuitive and convenient online car buying, selling, and financing platform. Carvana.com enables consumers to quickly and easily shop more than 45,000 vehicles, finance, trade in or sell their current vehicle to Carvana, sign contracts, and schedule as-soon-as-next-day delivery or pickup at one of Carvana’s patented, automated Car Vending Machines. Carvana is a Fortune 500 company, providing as-soon-as-next-day delivery to customers in over 300 U.S. markets.
Cautionary Statement Concerning Forward-Looking Statements This press release contains "forward-looking statements" within the meaning of federal securities laws. Words such as "expect" and "intend" and similar expressions identify forward-looking statements, which include but are not limited to statements related to the timing of EV deliveries and the expansion of charging infrastructure and any other statements regarding future expectations, beliefs, plans, objectives, future events or performance. We caution you that these statements are not guarantees of future performance and are subject to numerous evolving risks and uncertainties that Hertz may not be able to accurately predict or assess, including those in the risk factors that Hertz identifies in its annual reports on Form 10-K for the year ended December 31, 2020, as filed with the Securities and Exchange Commission (the "SEC"), and any updates thereto in subsequent filings with the SEC. We caution you not to place undue reliance on our forward-looking statements, which speak only as of their date, and Hertz undertakes no obligation to update this information.
ESTERO, Fla. and SAN FRANCISCO, Oct. 27, 2021 /PRNewswire/ — Hertz and Uber (NYSE: UBER) today are accelerating the adoption of electric vehicles (EVs) in the U.S. through a new exclusive partnership to make up to 50,000 Teslas available by 2023 for drivers to rent when using the Uber network.
This partnership is the largest expansion of electric vehicles on a mobility platform in North America and one of the largest globally, marking another step toward Uber’s zero-emissions goal. Starting Nov. 1, drivers can rent Teslas from Hertz through this program in Los Angeles, San Francisco, San Diego and Washington, D.C. – with a nationwide expansion planned in the coming weeks.
For Hertz, the partnership is part of its commitment to lead the future of travel, mobility and the auto industry. This includes Hertz leading in electrification, shared mobility and a digital-first customer experience. On Monday, Hertz announced its most significant investment to offer the largest EV rental fleet in North America and one of the largest in the world. This includes an initial order of 100,000 Teslas by the end of 2022 and new EV charging infrastructure across Hertz’s global operations.
"Today’s partnership with Uber is another major step forward in Hertz becoming an essential component of the modern mobility ecosystem and executing on our commitment to being an environmentally forward company," said Mark Fields, Hertz interim CEO. "We are creating the new Hertz and charting a dynamic, new course for the future of travel, mobility and the auto industry."
"Climate change is an urgent global challenge we must all tackle together, and now is the time to drive a green recovery from the pandemic," said Uber CEO Dara Khosrowshahi. "This combines the power of Tesla, Hertz and Uber to help accelerate the transition to zero-emissions mobility. We look forward to seeing more EVs on the road right away."
For drivers looking to rent a Tesla, this is the best deal available in the market today. It offers drivers gas savings, higher earnings potential, access to the Tesla Supercharger network and Uber’s exclusive EVgo discounts, and other financial benefits through Uber’s Green Future program, which provides incentives – such as $1 more per trip up to $4,000 annually – for drivers to transition from gas-powered vehicles to EVs.
Globally, consumer interest in electric vehicles is skyrocketing because of environmental concern, convenience and reduced operating costs. Access to carpool lanes for solo-occupant vehicles – for both personal and ride-sharing vehicles – also is a major motivator.
Drivers are becoming increasingly interested in EVs. A recent survey of more than 6,000 internal combustion engine (ICE) drivers using the Uber app showed that 47 percent are interested in a battery EV as their next car.
Uber and Hertz have partnered since 2016 to provide drivers with vehicle rental options. With this partnership, Hertz will kick off the program by providing up to 50,000 vehicles by 2023 exclusively to drivers. If successful, the program could expand to 150,000 Teslas during the next three years. Hertz pointed out that these ambitions could be affected by factors outside of its control, such as semiconductor chip shortages or other constraints.
Participating drivers receive a preferred weekly rate for Hertz rentals, which includes insurance, basic maintenance and unlimited miles. The Hertz-Uber offering can also make it easier for drivers to source a vehicle, by eliminating the long-term commitments that buying or leasing a car often require.
Hertz has been an electric vehicle pioneer during the past decade. It was the first U.S. car rental company to introduce EVs to its rental fleet in 2011 and the first to implement a wireless charging system for electric vehicles. The company also is the exclusive rental car member of the Corporate Electric Vehicle Alliance, a consortium of companies focused on accelerating the transition to electric vehicles.
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 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.
About Uber Uber’s mission is to create opportunity through movement. We started in 2010 to solve a simple problem: how do you get access to a ride at the touch of a button? More than 25 billion trips later, we’re building products to get people closer to where they want to be. By changing how people, food, and things move through cities, Uber is a platform that opens up the world to new possibilities.
This press release contains "forward-looking statements" within the meaning of federal securities laws. Words such as "expect" and "intend" and similar expressions identify forward-looking statements, which include but are not limited to statements related to the timing of EV deliveries and the expansion of charging infrastructure and any other statements regarding future expectations, beliefs, plans, objectives, future events or performance. We caution you that these statements are not guarantees of future performance and are subject to numerous evolving risks and uncertainties that Hertz may not be able to accurately predict or assess, including those in the risk factors that Hertz identifies in its annual reports on Form 10-K for the year ended December 31, 2020, as filed with the Securities and Exchange Commission (the "SEC"), and any updates thereto in subsequent filings with the SEC. We caution you not to place undue reliance on our forward-looking statements, which speak only as of their date, and Hertz undertakes no obligation to update this information.
ESTERO, Fla., Oct. 21, 2021 /PRNewswire/ — Hertz today announced that Tim Langley-Hawthorne will join the company as executive vice president and chief information officer. Langley-Hawthorne will lead Hertz’s global technology strategy, including modernizing its technology infrastructure.
Tim Langley-Hawthorne, Hertz Executive Vice President and Chief Information Officer
"As we create the new Hertz, we’re investing in the technology that will enable a best-in-class, digital-first customer experience," said Mark Fields, Hertz interim CEO. "Tim’s proven track record of creating strong customer satisfaction and business value through technology make him the ideal leader to bring Hertz’s IT infrastructure up to world-class standards and support our efforts to lead the future of mobility and travel."
Langley-Hawthorne brings more than 20 years of experience as a global technology leader, most recently serving as CIO at Hitachi Vantara, a hi-tech subsidiary of Hitachi Ltd. operating in more than 100 countries. In that role, he led transformational infrastructure, application and information security efforts and all technology integration for global M&A transactions. In addition, he received industry recognition for the business value his teams delivered through end-to-end digital innovation.
Prior to Hitachi, Langley-Hawthorne held various executive technology and operations positions at Western Union, leading several transformational projects that significantly advanced the capabilities of the global customer service team. In addition, he spent 20 years in various IT, consulting and commercial roles at Information Services Group, Electronic Data Systems and IBM Australia.
"I’m honored to join Hertz at this incredibly exciting time in the company’s history," said Langley-Hawthorne. "I’m looking forward to leading transformative global IT initiatives and innovations that will support Hertz’s strategic vision and add value for customers and employees."
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 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.
