Herc triples capex in strong first quarter

US company Herc Rentals’ equipment rental revenue for the first quarter of 2022 has increased 31.6%, to “a record” $526.8 million compared to the same period last year.

Herc Rentals equipment being delivered.

Herc’s first quarter 2022 results, released today, reported total revenues up 25% to $567.3 million for three months to 31 March, while gross rental equipment capex more than tripled to $286.8 million during the quarter. 

The 25% rise in total revenue to $567.3 million, representing a $113.5 million uptick, was linked to growth in equipment rental revenue of $126.4 million.

This was offset by lower sales of rental equipment of $16.5 million, due to strong rental demand, the company said. 

Herc’s net rental equipment capex was $258.0 million for the first three months of 2022, while gross capex more than tripled at $286.8 million compared to $90.9 million in the previous period.

The company reported adjusted EBITDA up 28.3% to $236.8 million for the quarter, compared to $184.6 million.

Larry Silber, president and CEO, Herc Rentals. (Photo: Herc Rentals)

Herc’s president and chief executive officer Larry Silber said the strong result had accelerated the company’s growth expectations for the full year.

Herc’s adjusted EBITDA guidance for 2022 is now $1,175 million to $1,245 million, compared to $1,075 million to $1,175 million previously.

The company has maintained its net rental capital expenditure guidance, now $900 million to $1,120 million, compared to the previous guidance of $820 million to $1,120 million.

The first quarter of 2022 saw Herc acquire three companies and open five new greenfield locations.

“We closed on the previously announced acquisition of Cloverdale Equipment Company earlier this week and are confident we can continue to execute our organic growth strategy that is supplemented with strategic M&A,” said Silber.

Herc made a total of 12 acquisitions in 2021.