Pricing and utilisation rates boost H&E results

By Thomas Allen28 October 2019

Higher rental rates and increased utilisation have boosted H&E Equipment Services’ results for the third quarter of 2019.

The US-based rental firm’s overall revenues rose by 9.6% to US$353 million, compared to the third quarter of 2018.

H&E

Within that, total equipment rental revenues increased by 18.2% to $204 million, and rental revenues rose by 18.4% to $184.8 million, compared to the equivalent period in the previous year.

Brad Barber, the company’s CEO and President, said, “Our third quarter results were solid as we continued to experience broad-based demand for rental equipment throughout our end-user construction markets.

“We achieved a 2.4% improvement in rates compared to a year ago and physical utilisation increased 40 basis points to 71.4%, which helped drive an 18.4% increase in rental revenues.”

H&E’s net income was up 33% on the third quarter of 2018 to $28 million and its adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) increased by 18% to $128 million.

A rise in the company’s gross margin from 35.6% in the third quarter of 2018 to 37.4% in the third quarter of 2019 was attributed largely to a shift in revenue mix to rentals and higher equipment rental gross margins.

The original purchase cost of H&E’s rental fleet grew by just over 12% to $2 billion – an increase of $216 million.

Barber said, “We are pleased with our year-to-date performance and ability to capitalize on the ongoing strength and opportunities in the well-diversified construction markets we serve throughout our 23-state footprint.”

Increasing the scale of the rental business continues to be a strategic priority, according to Barber, who added, “We expect to achieve this goal through organic growth, acquisitions and warm-start store openings.

“Based on our current performance, solid level of project activity and our customers’ feedback, our market outlook remains positive.”

MAGAZINE
NEWSLETTER
Delivered directly to your inbox, Access, Lift & Handlers Newsletter features the pick of the breaking news stories, product launches, show reports and more from KHL's world-class editorial team.
Featured Training From Easybook
NYC SST Online Training

The clock is ticking… Construction workers in New York City – have you fulfilled your required Site Safety Training (SST)? Get your SST card online now

Latest Events
Last chance to register for the virtual ALH Conference
The ALH Conference is set to kick off (virtually) at 9 a.m. CST on Tuesday, Sept. 14. This is your last chance to register for the live event
ALH Conference shifts to virtual format
The ALH Conference, set for September 14, will be held online, ALH and KHL Group have announced. Registration is now open
ARA Show: Rental-ready
The ARA Show will return to Las Vegas this October for the first time in eight years. ALH provides a preview to the all-things-rental event.
Off-Highway Research

The gold standard in market research

Off-Highway Research offers a library of more than 200 regularly updated reports, providing forensic detail on key aspects of the construction equipment industry.

Our detailed insights and expert analyses are used by over 500 of the world’s largest and most successful suppliers, manufacturers and distributers, to inform their strategic plans and deliver profitable growth.

Click here to visit our website

CONNECT WITH THE TEAM
Lindsey Anderson Editor, Access, Lift & Handlers Tel: +1 312 929 4409 E-mail: lindsey.anderson@khl.com
Tony Radke Sales Manager Tel: +1 480 478 6302 E-mail: tony.radke@khl.com
CONNECT WITH SOCIAL MEDIA