Hertz Global Holdings Reports Record Fourth Quarter and Full-Year 2019 Revenue

ESTERO, Fla., Feb. 24, 2020 /PRNewswire/ -- Hertz Global Holdings, Inc. (NYSE: HTZ) ("Hertz Global" or the "Company") today reported results for its fourth quarter and year ended December 31, 2019.

• Record U.S. RAC revenue, up 6% for the fourth quarter, 7% for the full year on pricing and volume
• Record global revenue, up 1% for the fourth quarter, 3% for the full year
• Global revenue, excluding Donlen adjustments and fx, increased 5% for the fourth quarter and full year
• Net loss attributable to Hertz Global was $118 million for the fourth quarter, $58 million for the full year
• Adjusted Corporate EBITDA up 11% for the fourth quarter, 50% for the full year

"We have made tremendous progress over the past three years in re-igniting topline growth, driving margin expansion and improving customer satisfaction. Our latest results reflect 10 straight quarters of year-over-year revenue growth and nine consecutive quarters of year-over-year adjusted corporate EBITDA growth," said Kathryn Marinello, Hertz's Chief Executive Officer. "We are leveraging our existing capabilities to drive new revenue opportunities and continuing our focus on operational efficiencies to ensure sustainable earnings improvement over the long-term."

For the fourth quarter 2019, total revenues were $2.3 billion, a 1% increase versus the fourth quarter 2018. Net loss attributable to Hertz Global was $118 million, or $0.83 loss per diluted share, compared with net loss attributable to Hertz Global of $101 million for the fourth quarter 2018, or $1.05 loss per diluted share. The Company reported Adjusted Net Loss for the fourth quarter 2019 of $34 million, or $0.24 Adjusted Diluted Loss Per Share, compared with Adjusted Net Loss of $46 million for the fourth quarter 2018, or $0.48 Adjusted Diluted Loss Per Share. Adjusted Corporate EBITDA for the fourth quarter 2019 was $54 million versus $49 million for the same period last year.

For the full-year 2019, total revenues were $9.8 billion, a 3% increase versus 2018. Net loss attributable to Hertz Global was $58 million, or $0.49 loss per diluted share, compared with net loss attributable to Hertz Global of $225 million for 2018, or $2.35 loss per diluted share. The Company reported Adjusted Net Income for 2019 of $168 million, or $1.44 Adjusted Diluted Earnings Per Share, compared with Adjusted Net Loss of $14 million for 2018, or $0.15 Adjusted Diluted Loss Per Share. Adjusted Corporate EBITDA for 2019 was $649 million versus $433 million for 2018.

U.S. RENTAL CAR ("U.S. RAC") SUMMARY
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Total U.S. RAC revenues of $1.7 billion were a fourth quarter record for the Company and up 6% on higher volume and pricing. Revenue per day was up 4% as pricing improved across all brands, in both business and leisure categories, and in on- and off-airport rentals. Transaction days grew 2% driven by solid demand from the Company's growth initiatives in TNC and delivery rentals. Vehicle utilization was negatively impacted by a significant number of units on safety recall compared to a year ago and the continued ramp up of trucks and vans to meet future demand for delivery rentals.

Depreciation Per Unit Per Month increased 11%, reflecting lower residual values on certain vehicles sold by the Company during the quarter. The Company continues to benefit from dispositions through its higher returning retail car-sales channel.

Adjusted Corporate EBITDA of $48 million was flat versus the fourth quarter of 2018. These results were driven by strong revenue growth and a 270-basis point improvement in operating expenses and SG&A as a percentage of revenue were offset by higher per-unit depreciation in the quarter.

INTERNATIONAL RENTAL CAR ("INTERNATIONAL RAC") SUMMARY
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NM - Not meaningful

Total International RAC revenues decreased 3% year-over-year and were flat on a constant currency basis. Total RPD was up 1% driven by improved pricing in Asia Pacific and Europe, offset by a volume decline of 1% due to continued softness in Europe.

Depreciation Per Unit Per Month increased 8% driven by residual value declines on certain vehicles that were disposed of during the quarter.

Adjusted EBITDA loss of $10 million reflected lower revenue and higher per-unit depreciation versus the fourth quarter of 2018.

ALL OTHER OPERATIONS SUMMARY
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All Other Operations primarily is comprised of the Company's Donlen leasing operations. Revenue was unfavorably impacted by a change in presentation for certain leased vehicles in 2019, which lowered revenue by $18 million during the quarter. In addition, in the prior year quarter, Donlen experienced higher than normal capital lease volume, resulting in a $53 million increase in revenue and depreciation. Excluding these items, Donlen revenues grew 10% in the quarter which drove a 36% increase in Adjusted EBITDA for the segment behind strong growth in leasing and fleet management.

RIGHTS OFFERING
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In June 2019, the Company distributed transferable subscription rights to its shareholders to purchase up to an aggregate of 57,915,055 new shares (the "Rights Offering"). The Rights Offering, which was fully subscribed, was consummated in July 2019. As a result of the timing of the subscription period, the rights generated a dilutive impact to the Company's 2019 basic and diluted earnings per share. The three and twelve months ended December 31, 2018 have been adjusted to reflect the impact of the Rights Offering, and the Company will continue to adjust prior periods for the impact, where necessary.

RESULTS OF THE HERTZ CORPORATION
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The GAAP and non-GAAP profitability metrics for Hertz Global's operating subsidiary, The Hertz Corporation ("Hertz"), are materially the same as those for Hertz Global.

EARNINGS WEBCAST INFORMATION
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Hertz Global's live webcast and conference call to discuss its fourth quarter 2019 results will be held on February 25, 2020, at 8:30 a.m. Eastern Time, and can be accessed through a link on the Investor Relations section of the Hertz website, IR.Hertz.com, or by dialing (877) 692-8955 and providing access code 2258216. Investors are encouraged to dial-in approximately 10 minutes prior to the call.  A web replay will remain available for approximately one year.  A telephone replay will be available one hour following the conclusion of the call for one year at (866) 207-1041 with access code 5425195. The earnings release and related supplemental schedules containing the reconciliations of non-GAAP measures will be available on the Hertz website, IR.Hertz.com.

SELECTED FINANCIAL DATA, SUPPLEMENTAL SCHEDULES, NON-GAAP MEASURES AND DEFINITIONS
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Following are tables that present selected financial data of Hertz Global. Also included are Supplemental Schedules which are provided to present segment results and reconciliations of non-GAAP measures to their most comparable GAAP measure. 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.

ABOUT HERTZ
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The Hertz Corporation, a subsidiary of Hertz Global Holdings, Inc., operates the Hertz, Dollar and Thrifty vehicle rental brands in approximately 10,200 corporate and franchisee locations 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.  Product and service initiatives such as Hertz Gold Plus Rewards, Ultimate Choice, Carfirmations, Mobile Wi-Fi and unique vehicles offered through its specialty collections set Hertz apart from the competition.  Additionally, The Hertz Corporation owns the vehicle leasing and fleet management leader Donlen 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.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
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Certain statements contained 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" 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 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.

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 others, those that may be disclosed, revised or supplemented from time to time in subsequent reports on Forms 10-K, 10-Q and 8-K filed with or furnished to the Securities and Exchange Commission ("SEC"). Among other items, such factors could include: levels of travel demand, particularly with respect to business and leisure travel in the United States and in global markets; significant changes in the competitive environment and the effect of competition in the Company's markets on rental volume and pricing, including on the Company's pricing policies or use of incentives; 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; 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 of additional or continued sources of financing for the Company's revenue earning vehicles and to refinance the Company's existing indebtedness; the Company's ability to adequately respond to changes in technology, customer demands and market competition; the Company's ability to purchase adequate supplies of competitively priced vehicles and risks relating to increases in the cost of the vehicles it purchases; 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 the Company's 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; the Company's ability to retain customer loyalty and market share; risks associated with operating in many different countries, including the risk of a violation or alleged violation of applicable anticorruption or antibribery laws, the Company's ability to repatriate cash from non-U.S. affiliates without adverse tax consequences, the Company's exposure to fluctuations in foreign currency exchange rates and the Company's ability to effectively manage the Company's international operations after the United Kingdom's withdrawal from the European Union; 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; 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; costs and risks associated with litigation and investigations or any failure or inability to comply with laws and regulations or any changes in the legal and regulatory environment, including laws and regulations relating to environmental matters and consumer privacy and data security; 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; the Company's ability to maintain an effective employee retention and talent management strategy and resulting changes in personnel and employee relations; 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; the Company's exposure to uninsured claims in excess of historical levels; risks relating to the Company's participation in multiemployer pension plans; risks related to the Company's indebtedness, including the Company's substantial amount of debt, the Company's ability to incur substantially more debt, the fact that substantially all of the Company's consolidated assets secure certain of the Company's outstanding indebtedness and increases in interest rates or in the Company's borrowing margins; the Company's ability to meet the financial and other covenants contained in the Company's senior credit facilities and letter of credit facility, the Company's outstanding unsecured senior notes, the Company's outstanding senior second priority secured notes and certain asset-backed and asset-based arrangements; the Company's ability to access financial markets, including the financing of the Company's vehicle fleet through the issuance of asset-backed securities; fluctuations in interest rates and commodity prices; the Company's ability to sustain operations during adverse economic cycles and unfavorable external events (including war, terrorist acts, natural disasters and epidemic disease); shortages of fuel and increases or volatility in fuel costs; changes in accounting principles, or their application or interpretation, and the Company's ability to make accurate estimates and the assumptions underlying the estimates, which could have an effect on operating results; and other risks and uncertainties described from time to time in periodic and current reports that the Company 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 hereof, 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.

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FINANCIAL INFORMATION AND OPERATING DATA
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SELECTED UNAUDITED CONSOLIDATED INCOME STATEMENT DATA