"Hertz posted another quarter of solid performance,
reflecting overall strength in our business and continued demand
for our services across all customer segments," said Stephen Scherr, Hertz chief executive officer.
"I am enormously proud of the performance of our team, particularly
our colleagues in Southwest
Florida, who faced challenges from Hurricane Ian. Across
geographies, we focused on operational excellence and fleet
optimization to produce financial results that facilitated
investment in our strategic priorities, like electrification, while
enhancing returns to our shareholders and being in the service of
our customers."
ESTERO,
Fla., Oct. 27, 2022 /PRNewswire/ -- Hertz Global
Holdings, Inc. (NASDAQ: HTZ) ("Hertz", "Hertz Global" or the
"Company") today reported results for its third quarter 2022.
HIGHLIGHTS
- Total revenues of $2.5
billion
- GAAP net income of $577 million,
or $1.33 per diluted share
- Adjusted Net Income of $410
million, or $1.08 per adjusted
diluted share (reflects adjustments for fair value
remeasurements to outstanding public warrants and certain
derivative contracts, among other items)
- Adjusted Corporate EBITDA of $618
million, a 25% margin
- Operating cash flow of $932
million, adjusted operating cash flow of $572 million
- Adjusted free cash flow of $505
million
- Corporate liquidity of $2.6
billion at September 30,
including $1.0 billion in
unrestricted cash
- Company utilized $500 million to
repurchase 27.2 million common shares during the quarter
Revenue was $2.5 billion, up 12%
year over year, characterized by continued strength in demand and
rate across all customer segments, with significantly increased
contribution of value-added services revenue. Monthly revenue per
unit was a quarterly record of $1,685
on utilization of 80%. Gross depreciation continued to normalize as
the Company progressed its fleet rejuvenation, and car sales gains
came in lower versus the previous quarter due to steeper than
expected residual value declines. As a result, monthly net
depreciation per unit was $187.
During the first two months of the quarter, the Company ran with
intentionally elevated maintenance cost to address out of service
levels. As a result of these efforts, by September, utilization had
reached 81.4%, and maintenance cost receded such that the business
experienced more typical operating cost leverage. Adjusted
Corporate EBITDA was $618 million,
representing a healthy margin of 25%. Adjusted free cash flow was
$505 million, reflecting free cash
flow conversion of 82%, which the Company utilized to repurchase 7%
of its common stock, thereby increasing shareholder value.
SUMMARY RESULTS
|
Three Months Ended
September 30,
|
|
Percent
Inc/(Dec)
2022 vs 2021
|
|
($ in millions, except earnings per share or where
noted)
|
2022
|
|
2021
|
|
|
Hertz Global - Consolidated
|
|
|
|
|
|
|
Total
revenues
|
$
2,496
|
|
$
2,226
|
|
12 %
|
|
Adjusted net income
(loss)(a)
|
$
410
|
|
$
587
|
|
(30) %
|
|
Adjusted diluted
earnings (loss) per share(a)
|
$
1.08
|
|
$
1.20
|
|
(10) %
|
|
Adjusted Corporate
EBITDA(a)
|
$
618
|
|
$
860
|
|
(28) %
|
|
Adjusted Corporate
EBITDA Margin(a)
|
25 %
|
|
39 %
|
|
|
|
|
|
|
|
|
|
Average Vehicles (in
whole units)
|
532,740
|
|
473,492
|
|
13 %
|
|
Average Rentable
Vehicles (in whole units)
|
503,508
|
|
456,566
|
|
10 %
|
|
Vehicle
Utilization
|
80 %
|
|
80 %
|
|
|
|
Transaction Days (in
thousands)
|
37,123
|
|
33,489
|
|
11 %
|
|
Total RPD (in
dollars)(b)
|
$
68.57
|
|
$
66.15
|
|
4 %
|
|
Total RPU Per Month (in
whole dollars)(b)
|
$
1,685
|
|
$
1,617
|
|
4 %
|
|
Depreciation Per Unit
Per Month (in whole dollars)(b)
|
$
187
|
|
$
42
|
|
NM
|
|
|
|
|
|
|
|
Americas RAC Segment
|
|
|
|
|
|
|
Total
revenues
|
$
2,042
|
|
$
1,914
|
|
7 %
|
|
Adjusted
EBITDA
|
$
564
|
|
$
830
|
|
(32) %
|
|
Adjusted EBITDA
Margin
|
28 %
|
|
43 %
|
|
|
|
|
|
|
|
|
|
Average Vehicles (in
whole units)
|
425,596
|
|
387,368
|
|
10 %
|
|
Average Rentable
Vehicles (in whole units)
|
397,488
|
|
372,326
|
|
7 %
|
|
Vehicle
Utilization
|
81 %
|
|
81 %
|
|
|
|
Transaction Days (in
thousands)
|
29,653
|
|
27,627
|
|
7 %
|
|
Total RPD (in
dollars)(b)
|
$
68.90
|
|
$
69.25
|
|
(1) %
|
|
Total RPU Per Month (in
whole dollars)(b)
|
$
1,713
|
|
$
1,713
|
|
— %
|
|
Depreciation Per Unit
Per Month (in whole dollars)(b)
|
$
198
|
|
$
21
|
|
NM
|
|
|
|
|
|
|
|
International RAC Segment
|
|
|
|
|
|
|
Total
revenues
|
$
454
|
|
$
312
|
|
46 %
|
|
Adjusted
EBITDA
|
$
150
|
|
$
78
|
|
93 %
|
|
Adjusted EBITDA
Margin
|
33 %
|
|
25 %
|
|
|
|
|
|
|
|
|
|
Average Vehicles (in
whole units)
|
107,144
|
|
86,124
|
|
24 %
|
|
Average Rentable
Vehicles (in whole units)
|
106,020
|
|
84,241
|
|
26 %
|
|
Vehicle
Utilization
|
77 %
|
|
76 %
|
|
|
|
Transaction Days (in
thousands)
|
7,470
|
|
5,862
|
|
27 %
|
|
Total RPD (in
dollars)(b)
|
$
67.28
|
|
$
51.52
|
|
31 %
|
|
Total RPU Per Month (in
whole dollars)(b)
|
$
1,580
|
|
$
1,195
|
|
32 %
|
|
Depreciation Per Unit
Per Month (in whole dollars)(b)
|
$
146
|
|
$
137
|
|
6 %
|
|
|
NM - Not
meaningful
|
|
NOTE: Hertz Global -
consolidated key metrics reflect global rental car operations only
and exclude Donlen fleet management and leasing
|
|
(a)
Represents a non-GAAP measure. See the accompanying reconciliations
included in Supplemental Schedule II.
|
|
(b) Based
on December 31, 2021 foreign exchange rates.
|
LIQUIDITY AND CAPITAL RESOURCES
During the third quarter 2022, the Company repurchased 27.2
million shares for $500 million.
There is $1.4 billion remaining under
the authorization as of October 20, 2022.
The Company's liquidity position was $2.6
billion at September 30, 2022, of which $1.0 billion was unrestricted cash.
EARNINGS WEBCAST INFORMATION
Hertz Global's live webcast and conference call to discuss its
third quarter 2022 results will be held on October 27, 2022, at 8:30
a.m. Eastern Time. The conference call will be broadcast
live in listen-only mode on the Company's investor relations
website at IR.Hertz.com. If you would like to access the call by
phone and ask a question, please go to
https://register.vevent.com/register/BI328b89926fc24e6ead04d3c0ec8db8b3,
and you will be provided with dial in details. Investors are
encouraged to dial-in approximately 15 minutes prior to the
call. A web replay will remain available on the website for
approximately one year. The earnings release and related
supplemental schedules containing the reconciliations of non-GAAP
measures will be available on the Hertz website, IR.Hertz.com.
UNAUDITED FINANCIAL DATA, SUPPLEMENTAL SCHEDULES, NON-GAAP
MEASURES AND DEFINITIONS
Following is 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
the earnings release and its view of the usefulness of non-GAAP
measures to investors and management.
In the first quarter of 2022, the Company began using Average
Rentable Vehicles when calculating Available Car Days, Total RPU
and Utilization instead of Average Vehicles. Average Rentable
Vehicles excludes vehicles for sale on the Company's retail lots or
actively in the process of being sold through other disposition
channels. Prior periods have been restated to conform with the
revisions, as appropriate. The Company has also restated historical
quarterly and annual periods beginning with first quarter 2019 to
reflect this change and has posted this information to its investor
relations website at IR.Hertz.com.
ABOUT HERTZ
The Hertz Corporation, a subsidiary of Hertz Global Holdings,
Inc., operates the Hertz, Dollar and Thrifty vehicle rental brands
throughout North America,
Europe, the Caribbean, Latin
America, Africa, the
Middle East, Asia, Australia and New
Zealand. The Hertz Corporation is one of the largest
worldwide vehicle rental companies, and the Hertz brand is one of
the most recognized globally. Additionally, The Hertz Corporation
owns and operates the Firefly vehicle rental brand and Hertz 24/7
car sharing business in international markets and sells vehicles
through Hertz Car Sales. For more information about The Hertz
Corporation, visit www.hertz.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained or incorporated by reference in
this release, and in related comments by the Company's management,
include "forward-looking statements." Forward-looking statements
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 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, as well as the
impact on its employee retention and talent management
strategies;
- the impact of macroeconomic conditions resulting in
inflationary cost pressures, labor and supply chain constraints,
increased vehicle acquisition costs, and reductions in travel
demand, among others;
- the Company's ability to purchase adequate supplies of
competitively priced vehicles at a reasonable cost as a result of
the continuing global semiconductor microchip manufacturing
shortage (the "Chip Shortage") and other raw material supply
constraints;
- the impact of the conflict between Russia and Ukraine on supply chains and raw materials for
the automotive industry and uncertainty on overall consumer
sentiment and travel demand, especially in Europe;
- the impact on the value of the Company's non-program
vehicles upon disposition when the Chip Shortage and other raw
material supply constraints are alleviated;
- the Company's ability to attract and retain key
employees;
- levels of travel demand, particularly business and leisure
travel in the U.S. 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;
- 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 its rental operations accordingly;
- the Company's ability to implement our 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 adequately respond to changes in
technology, customer demands and market competition;
- the mix of program and non-program vehicles in the Company's
fleet can lead to increased exposure to residual risk;
- the Company's ability to dispose of vehicles in the
used-vehicle market and use the proceeds of such sales to acquire
replacement vehicles;
- financial instability of the manufacturers of the Company's
vehicles, which could impact its ability to fulfill obligations
under repurchase or guaranteed depreciation programs;
- an increase in the Company's vehicle costs or disruption to
its rental activity due to safety recalls by the manufacturers of
its vehicles;
- the Company's access to third-party distribution channels
and related prices, commission structures and transaction
volumes;
- the Company's ability to offer an excellent customer
experience, and retain and increase customer loyalty and market
share;
- 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;
- major disruption in the Company's communication or
centralized information networks or a failure to maintain, upgrade
and consolidate its 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, as well as its ability to
comply with privacy regulations;
- 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;
- the Company's ability to utilize its net operating loss
carryforwards;
- risks relating to tax laws and regulations, or changes in
such laws and regulations, that affect the Company's ability to
deduct certain business interest expenses and offset
previously-deferred tax gains, as well as any adverse
determinations or rulings by tax authorities;
- changes in laws, regulations, policies or other activities
of governments, agencies and similar organizations, including those
related to accounting principles, that affect the Company's
operations, its costs or applicable tax rates;
- the recoverability of the Company's goodwill and
indefinite-lived intangible assets when performing impairment
analysis;
- costs and risks associated with potential litigation and
investigations, compliance with and changes in laws and regulations
and potential exposures under environmental laws and regulations;
and
- the availability of additional or continued sources of
financing for the Company's revenue earning vehicles and to
refinance its existing indebtedness.
Additional information concerning these and other factors can be
found in the Company's filings with the SEC, including its Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K.
You should not place undue reliance on forward-looking
statements. All forward-looking statements attributable to the
Company or persons acting on its behalf are expressly qualified in
their entirety by the foregoing cautionary statements. All such
statements speak only as of the date of this release, and, except
as required by law, the Company undertakes no obligation to update
or revise publicly any forward-looking statements, whether as a
result of new information, future events or otherwise.
|
UNAUDITED FINANCIAL
INFORMATION
|
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
(In millions, except per share
data)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
Revenues
|
$
2,496
|
|
$
2,226
|
|
$
6,650
|
|
$
5,387
|
|
Expenses:
|
|
|
|
|
|
|
|
|
Direct vehicle and
operating
|
1,282
|
|
1,131
|
|
3,534
|
|
2,855
|
|
Depreciation of
revenue earning vehicles and lease charges, net
|
294
|
|
61
|
|
341
|
|
420
|
|
Depreciation and
amortization of non-vehicle assets
|
36
|
|
49
|
|
105
|
|
153
|
|
Selling, general and
administrative
|
246
|
|
177
|
|
738
|
|
498
|
|
Interest expense,
net:
|
|
|
|
|
|
|
|
|
Vehicle
|
27
|
|
41
|
|
77
|
|
243
|
|
Non-vehicle
|
43
|
|
22
|
|
123
|
|
157
|
|
Total interest
expense, net
|
70
|
|
63
|
|
200
|
|
400
|
|
Other (income)
expense, net
|
(6)
|
|
(7)
|
|
(6)
|
|
(20)
|
|
Reorganization items,
net
|
—
|
|
—
|
|
—
|
|
677
|
|
(Gain) from the sale
of a business
|
—
|
|
—
|
|
—
|
|
(400)
|
|
Change in fair value
of Public Warrants
|
(73)
|
|
(16)
|
|
(584)
|
|
(16)
|
|
Total
expenses
|
1,849
|
|
1,458
|
|
4,328
|
|
4,567
|
|
Income (loss) before
income taxes
|
647
|
|
768
|
|
2,322
|
|
820
|
|
Income tax (provision)
benefit
|
(70)
|
|
(160)
|
|
(379)
|
|
(193)
|
|
Net income
(loss)
|
577
|
|
608
|
|
1,943
|
|
627
|
|
Net (income) loss
attributable to noncontrolling interests
|
—
|
|
(3)
|
|
—
|
|
(1)
|
|
Net income (loss)
attributable to Hertz Global
|
577
|
|
605
|
|
1,943
|
|
626
|
|
Dividends on Series A
Preferred Stock
|
—
|
|
(34)
|
|
—
|
|
(34)
|
|
Net income (loss)
available to Hertz Global common stockholders
|
$
577
|
|
$
571
|
|
$
1,943
|
|
$
592
|
|
|
|
|
|
|
|
|
|
Weighted average number
of shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
355
|
|
471
|
|
395
|
|
264
|
|
Diluted
|
379
|
|
490
|
|
421
|
|
270
|
|
Earnings (loss) per
share:
|
|
|
|
|
|
|
|
|
Basic
|
$
1.62
|
|
$
1.21
|
|
$
4.92
|
|
$
2.25
|
|
Diluted
|
$
1.33
|
|
$
1.13
|
|
$
3.22
|
|
$
2.14
|
|
UNAUDITED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
(In millions, except par value and share
data)
|
September 30,
2022
|
|
December 31,
2021
|
|
ASSETS
|
|
|
|
|
Cash and cash
equivalents
|
$
1,006
|
|
$
2,258
|
|
Restricted cash and
cash equivalents:
|
|
|
|
|
Vehicle
|
203
|
|
77
|
|
Non-vehicle
|
299
|
|
316
|
|
Total restricted cash
and cash equivalents
|
502
|
|
393
|
|
Total cash and cash
equivalents and restricted cash and cash equivalents
|
1,508
|
|
2,651
|
|
Receivables:
|
|
|
|
|
Vehicle
|
222
|
|
62
|
|
Non-vehicle, net of
allowance of $46 and $48, respectively
|
831
|
|
696
|
|
Total receivables,
net
|
1,053
|
|
758
|
|
Prepaid expenses and
other assets
|
934
|
|
1,017
|
|
Revenue earning
vehicles:
|
|
|
|
|
Vehicles
|
13,757
|
|
10,836
|
|
Less: accumulated
depreciation
|
(1,734)
|
|
(1,610)
|
|
Total revenue earning
vehicles, net
|
12,023
|
|
9,226
|
|
Property and equipment,
net
|
618
|
|
608
|
|
Operating lease
right-of-use assets
|
1,632
|
|
1,566
|
|
Intangible assets,
net
|
2,883
|
|
2,912
|
|
Goodwill
|
1,043
|
|
1,045
|
|
Total
assets
|
$
21,694
|
|
$
19,783
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
|
|
|
Accounts
payable:
|
|
|
|
|
Vehicle
|
$
112
|
|
$
56
|
|
Non-vehicle
|
502
|
|
516
|
|
Total accounts
payable
|
614
|
|
572
|
|
Accrued
liabilities
|
955
|
|
863
|
|
Accrued taxes,
net
|
205
|
|
157
|
|
Debt:
|
|
|
|
|
Vehicle
|
10,097
|
|
7,921
|
|
Non-vehicle
|
2,979
|
|
2,986
|
|
Total debt
|
13,076
|
|
10,907
|
|
Public
Warrants
|
737
|
|
1,324
|
|
Operating lease
liabilities
|
1,556
|
|
1,510
|
|
Self-insured
liabilities
|
484
|
|
463
|
|
Deferred income taxes,
net
|
1,306
|
|
1,010
|
|
Total
liabilities
|
18,933
|
|
16,806
|
|
Commitments and
contingencies
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
Preferred stock, $0.01
par value, no shares issued and outstanding
|
—
|
|
—
|
|
Common stock, $0.01 par
value, 477,792,170 and 477,233,278 shares issued,
respectively, and
341,223,449 and 449,782,424 shares
outstanding, respectively
|
5
|
|
5
|
|
Treasury stock, at
cost, 136,568,721 and 27,450,854 common shares,
respectively
|
(2,821)
|
|
(708)
|
|
Additional paid-in
capital
|
6,308
|
|
6,209
|
|
Retained earnings
(Accumulated deficit)
|
(372)
|
|
(2,315)
|
|
Accumulated other
comprehensive income (loss)
|
(359)
|
|
(214)
|
|
Total stockholders'
equity
|
2,761
|
|
2,977
|
|
Total liabilities and
stockholders' equity
|
$
21,694
|
|
$
19,783
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
(In millions)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
577
|
|
$
608
|
|
$
1,943
|
|
$
627
|
|
Adjustments to
reconcile net income (loss) to net cash provided by (used
in) operating activities:
|
|
|
|
|
|
|
|
|
Depreciation and
reserves for revenue earning vehicles
|
366
|
|
86
|
|
511
|
|
506
|
|
Depreciation and
amortization, non-vehicle
|
36
|
|
49
|
|
105
|
|
153
|
|
Amortization of
deferred financing costs and debt discount (premium)
|
13
|
|
11
|
|
38
|
|
109
|
|
Loss on extinguishment
of debt
|
—
|
|
—
|
|
—
|
|
8
|
|
Stock-based
compensation charges
|
32
|
|
—
|
|
96
|
|
2
|
|
Provision for
receivables allowance
|
19
|
|
31
|
|
42
|
|
95
|
|
Deferred income taxes,
net
|
52
|
|
141
|
|
301
|
|
125
|
|
Reorganization items,
net
|
—
|
|
—
|
|
—
|
|
314
|
|
(Gain) loss from the
sale of a business
|
—
|
|
—
|
|
—
|
|
(400)
|
|
Change in fair value
of Public Warrants
|
(73)
|
|
(16)
|
|
(584)
|
|
(16)
|
|
(Gain) loss on
financial instruments
|
(55)
|
|
(3)
|
|
(120)
|
|
(1)
|
|
Other
|
1
|
|
(5)
|
|
(2)
|
|
(15)
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
Non-vehicle
receivables
|
(34)
|
|
(9)
|
|
(234)
|
|
(223)
|
|
Prepaid expenses and
other assets
|
7
|
|
14
|
|
(80)
|
|
(53)
|
|
Operating lease
right-of-use assets
|
123
|
|
49
|
|
202
|
|
203
|
|
Non-vehicle accounts
payable
|
25
|
|
(139)
|
|
(7)
|
|
(45)
|
|
Accrued
liabilities
|
(50)
|
|
(32)
|
|
183
|
|
(43)
|
|
Accrued taxes,
net
|
—
|
|
(2)
|
|
52
|
|
89
|
|
Operating lease
liabilities
|
(130)
|
|
(54)
|
|
(223)
|
|
(214)
|
|
Self-insured
liabilities
|
23
|
|
14
|
|
38
|
|
(13)
|
|
Net cash provided by
(used in) operating activities
|
932
|
|
743
|
|
2,261
|
|
1,208
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Revenue earning
vehicles expenditures
|
(1,764)
|
|
(1,060)
|
|
(7,853)
|
|
(5,196)
|
|
Proceeds from disposal
of revenue earning vehicles
|
1,583
|
|
746
|
|
4,470
|
|
1,945
|
|
Non-vehicle capital
asset expenditures
|
(45)
|
|
(24)
|
|
(104)
|
|
(41)
|
|
Proceeds from
non-vehicle capital assets disposed of or to be disposed
of
|
4
|
|
7
|
|
10
|
|
17
|
|
Collateral
payments
|
—
|
|
—
|
|
—
|
|
(303)
|
|
Collateral returned in
exchange for letters of credit
|
—
|
|
154
|
|
19
|
|
268
|
|
Return of (investment
in) equity investments
|
—
|
|
—
|
|
(15)
|
|
—
|
|
Proceeds from the sale
of a business, net of cash sold
|
—
|
|
53
|
|
—
|
|
871
|
|
Other
|
—
|
|
—
|
|
—
|
|
(1)
|
|
Net cash provided by
(used in) investing activities
|
(222)
|
|
(124)
|
|
(3,473)
|
|
(2,440)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from issuance
of vehicle debt
|
903
|
|
1,523
|
|
8,282
|
|
10,462
|
|
Repayments of vehicle
debt
|
(1,130)
|
|
(1,343)
|
|
(5,954)
|
|
(9,463)
|
|
Proceeds from issuance
of non-vehicle debt
|
—
|
|
—
|
|
—
|
|
3,139
|
|
Repayments of
non-vehicle debt
|
(4)
|
|
(5)
|
|
(14)
|
|
(6,346)
|
|
Payment of financing
costs
|
(4)
|
|
(3)
|
|
(42)
|
|
(154)
|
|
Proceeds from Plan
Sponsors
|
—
|
|
—
|
|
—
|
|
2,781
|
|
Proceeds from Rights
Offering, net
|
—
|
|
4
|
|
—
|
|
1,639
|
|
Proceeds from the
issuance of preferred stock, net
|
—
|
|
—
|
|
—
|
|
1,433
|
|
Distributions to
common stockholders
|
—
|
|
—
|
|
—
|
|
(239)
|
|
Proceeds from
exercises of Public Warrants
|
—
|
|
—
|
|
3
|
|
—
|
|
Share
repurchases
|
(505)
|
|
—
|
|
(2,152)
|
|
—
|
|
Early redemption
payments
|
—
|
|
—
|
|
—
|
|
(85)
|
|
Contributions from
(distributions to) noncontrolling interests
|
—
|
|
(10)
|
|
—
|
|
(25)
|
|
Other
|
—
|
|
—
|
|
(4)
|
|
—
|
|
Net cash provided by
(used in) financing activities
|
(740)
|
|
166
|
|
119
|
|
3,142
|
|
Effect of foreign
currency exchange rate changes on cash and cash
equivalents and restricted cash and cash
equivalents
|
(25)
|
|
(14)
|
|
(50)
|
|
(22)
|
|
Net increase (decrease)
in cash and cash equivalents and restricted cash
and cash equivalents during the
period
|
(55)
|
|
771
|
|
(1,143)
|
|
1,888
|
|
Cash and cash
equivalents and restricted cash and cash equivalents at
beginning of period(a)
|
1,563
|
|
2,695
|
|
2,651
|
|
1,578
|
|
Cash and cash
equivalents and restricted cash and cash equivalents at end
of period
|
$
1,508
|
|
$
3,466
|
|
$
1,508
|
|
$
3,466
|
|
|
(a) Amounts
include cash and cash equivalents and restricted cash and cash
equivalents of Donlen which were held for sale as of
December 31, 2020.
|
|
Supplemental
Schedule I
|
|
HERTZ GLOBAL
HOLDINGS, INC.
|
|
CONDENSED STATEMENT
OF OPERATIONS BY SEGMENT
|
|
Unaudited
|
|
|
Three Months Ended September 30,
2022
|
|
Three Months Ended September 30,
2021
|
|
(In millions)
|
Americas
RAC
|
|
International
RAC
|
|
Corporate
|
|
Hertz
Global
|
|
Americas
RAC
|
|
International
RAC
|
|
All other
operations
|
|
Corporate
|
|
Hertz
Global
|
|
Revenues
|
$
2,042
|
|
$
454
|
|
$
—
|
|
$ 2,496
|
|
$
1,914
|
|
$
312
|
|
$
—
|
|
$
—
|
|
$ 2,226
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct vehicle and
operating
|
1,077
|
|
206
|
|
(1)
|
|
1,282
|
|
960
|
|
173
|
|
—
|
|
(2)
|
|
1,131
|
|
Depreciation of revenue
earning vehicles and lease charges, net
|
252
|
|
42
|
|
—
|
|
294
|
|
24
|
|
37
|
|
—
|
|
—
|
|
61
|
|
Depreciation and
amortization of non-vehicle assets
|
29
|
|
3
|
|
4
|
|
36
|
|
42
|
|
3
|
|
—
|
|
4
|
|
49
|
|
Selling, general and
administrative
|
85
|
|
53
|
|
108
|
|
246
|
|
72
|
|
27
|
|
—
|
|
78
|
|
177
|
|
Interest expense,
net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle
|
31
|
|
(4)
|
|
—
|
|
27
|
|
33
|
|
8
|
|
—
|
|
—
|
|
41
|
|
Non-vehicle
|
(23)
|
|
1
|
|
65
|
|
43
|
|
(4)
|
|
2
|
|
—
|
|
24
|
|
22
|
|
Total interest
expense, net
|
8
|
|
(3)
|
|
65
|
|
70
|
|
29
|
|
10
|
|
—
|
|
24
|
|
63
|
|
Other (income) expense,
net
|
(1)
|
|
4
|
|
(9)
|
|
(6)
|
|
(2)
|
|
(1)
|
|
—
|
|
(4)
|
|
(7)
|
|
Reorganization items,
net
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(Gain) from the sale of
a business
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Change in fair value of
Public Warrants
|
—
|
|
—
|
|
(73)
|
|
(73)
|
|
—
|
|
—
|
|
—
|
|
(16)
|
|
(16)
|
|
Total
expenses
|
1,450
|
|
305
|
|
94
|
|
1,849
|
|
1,125
|
|
249
|
|
—
|
|
84
|
|
1,458
|
|
Income (loss) before
income taxes
|
$
592
|
|
$
149
|
|
$
(94)
|
|
647
|
|
$
789
|
|
$
63
|
|
$
—
|
|
$
(84)
|
|
768
|
|
Income tax (provision)
benefit
|
|
|
|
|
|
|
(70)
|
|
|
|
|
|
|
|
|
|
(160)
|
|
Net income
(loss)
|
|
|
|
|
|
|
577
|
|
|
|
|
|
|
|
|
|
608
|
|
Net (income) loss
attributable to noncontrolling interests
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
(3)
|
|
Net income (loss)
attributable to Hertz Global
|
|
|
|
|
|
|
577
|
|
|
|
|
|
|
|
|
|
605
|
|
Series A Preferred
Stock deemed dividends
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
(34)
|
|
Net income (loss)
attributable to Hertz Global common
stockholders
|
|
|
|
|
|
|
$
577
|
|
|
|
|
|
|
|
|
|
$
571
|
|
|
NOTE: Effective in the
second quarter of 2021, as a result of the sale of the Company's
Donlen fleet management and leasing business on March 30, 2021, the
All Other Operations reportable segment, which consisted primarily
of the former Donlen business, was no longer deemed a reportable
segment.
|
|
Supplemental
Schedule I (continued)
|
|
HERTZ GLOBAL
HOLDINGS, INC.
|
|
CONDENSED STATEMENT
OF OPERATIONS BY SEGMENT
|
|
Unaudited
|
|
|
Nine Months Ended September 30,
2022
|
|
Nine Months Ended September 30,
2021
|
|
(In millions)
|
Americas RAC
|
|
International
RAC
|
|
Corporate
|
|
Hertz Global
|
|
Americas RAC
|
|
International
RAC
|
|
All other operations
|
|
Corporate
|
|
Hertz Global
|
|
Revenues
|
$
5,573
|
|
$
1,077
|
|
$
—
|
|
$ 6,650
|
|
$
4,524
|
|
$
727
|
|
$
136
|
|
$
—
|
|
$ 5,387
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct vehicle and
operating
|
2,982
|
|
554
|
|
(2)
|
|
3,534
|
|
2,394
|
|
452
|
|
5
|
|
4
|
|
2,855
|
|
Depreciation of revenue
earning vehicles and lease charges
|
220
|
|
121
|
|
—
|
|
341
|
|
314
|
|
106
|
|
—
|
|
—
|
|
420
|
|
Depreciation and
amortization of non-vehicle assets
|
85
|
|
10
|
|
10
|
|
105
|
|
130
|
|
12
|
|
2
|
|
9
|
|
153
|
|
Selling, general and
administrative
|
270
|
|
142
|
|
326
|
|
738
|
|
191
|
|
97
|
|
10
|
|
200
|
|
498
|
|
Interest expense,
net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle
|
68
|
|
9
|
|
—
|
|
77
|
|
182
|
|
49
|
|
12
|
|
—
|
|
243
|
|
Non-vehicle
|
(44)
|
|
1
|
|
166
|
|
123
|
|
(9)
|
|
3
|
|
1
|
|
162
|
|
157
|
|
Total interest
expense, net
|
24
|
|
10
|
|
166
|
|
200
|
|
173
|
|
52
|
|
13
|
|
162
|
|
400
|
|
Other (income) expense,
net
|
(3)
|
|
(3)
|
|
—
|
|
(6)
|
|
(8)
|
|
(2)
|
|
—
|
|
(10)
|
|
(20)
|
|
Reorganization items,
net
|
—
|
|
—
|
|
—
|
|
—
|
|
80
|
|
12
|
|
(1)
|
|
586
|
|
677
|
|
(Gain) from the sale of
a business
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(400)
|
|
(400)
|
|
Change in fair value of
Public Warrants
|
—
|
|
—
|
|
(584)
|
|
(584)
|
|
—
|
|
—
|
|
—
|
|
(16)
|
|
(16)
|
|
Total
expenses
|
3,578
|
|
834
|
|
(84)
|
|
4,328
|
|
3,274
|
|
729
|
|
29
|
|
535
|
|
4,567
|
|
Income (loss) before
income taxes
|
$
1,995
|
|
$
243
|
|
$
84
|
|
2,322
|
|
$
1,250
|
|
$
(2)
|
|
$
107
|
|
$
(535)
|
|
820
|
|
Income tax (provision)
benefit
|
|
|
|
|
|
|
(379)
|
|
|
|
|
|
|
|
|
|
(193)
|
|
Net income
(loss)
|
|
|
|
|
|
|
1,943
|
|
|
|
|
|
|
|
|
|
627
|
|
Net (income) loss
attributable to noncontrolling interests
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Net income (loss)
attributable to Hertz Global
|
|
|
|
|
|
|
1,943
|
|
|
|
|
|
|
|
|
|
626
|
|
Series A Preferred
Stock deemed dividends
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
(34)
|
|
Net income (loss)
attributable to Hertz Global common
stockholders
|
|
|
|
|
|
|
$ 1,943
|
|
|
|
|
|
|
|
|
|
$
592
|
|
|
NOTE: Effective in
the second quarter of 2021, as a result of the sale of the
Company's Donlen fleet management and leasing business on March 30,
2021, the All Other Operations reportable segment, which consisted
primarily of the former Donlen business, was no longer deemed a
reportable segment.
|
|
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)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
Adjusted Net Income (Loss) and Adjusted Diluted
Earnings (Loss) Per Share:
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Hertz Global
|
$
577
|
|
$
605
|
|
$
1,943
|
|
$
626
|
|
Dividends on Series A
Preferred Stock
|
—
|
|
(34)
|
|
—
|
|
(34)
|
|
Net income (loss)
attributable and available to Hertz Global common stockholders,
basic
|
577
|
|
571
|
|
1,943
|
|
592
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Income tax provision
(benefit)
|
70
|
|
160
|
|
379
|
|
193
|
|
Vehicle and
non-vehicle debt-related charges(a)(m)
|
13
|
|
12
|
|
39
|
|
116
|
|
Restructuring and
restructuring related charges(b)
|
8
|
|
22
|
|
29
|
|
72
|
|
Acquisition
accounting-related depreciation and
amortization(c)
|
1
|
|
12
|
|
2
|
|
37
|
|
Reorganization items,
net(d)
|
—
|
|
—
|
|
—
|
|
677
|
|
Pre-reorganization and
non-debtor financing charges(e)
|
—
|
|
1
|
|
—
|
|
41
|
|
Gain from the Donlen
Sale(f)
|
—
|
|
—
|
|
—
|
|
(400)
|
|
Unrealized (gains)
losses on financial instruments(g)
|
(55)
|
|
(1)
|
|
(120)
|
|
(1)
|
|
Change in fair value
of Public Warrants
|
(73)
|
|
(16)
|
|
(584)
|
|
(16)
|
|
Other
items(h)(n)
|
6
|
|
11
|
|
89
|
|
(67)
|
|
Adjusted pre-tax
income (loss)(i)
|
547
|
|
772
|
|
1,777
|
|
1,244
|
|
Income tax (provision)
benefit on adjusted pre-tax income (loss)(j)
|
(137)
|
|
(185)
|
|
(444)
|
|
(299)
|
|
Adjusted Net Income
(Loss)
|
$
410
|
|
$
587
|
|
$
1,333
|
|
$
945
|
|
Weighted-average
number of diluted shares outstanding
|
379
|
|
490
|
|
421
|
|
270
|
|
Adjusted Diluted
Earnings (Loss) Per Share(k)
|
$
1.08
|
|
$
1.20
|
|
$
3.16
|
|
$
3.50
|
|
Adjusted Corporate EBITDA:
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Hertz Global
|
$
577
|
|
$
605
|
|
$
1,943
|
|
$
626
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Income tax provision
(benefit)
|
70
|
|
160
|
|
379
|
|
193
|
|
Non-vehicle
depreciation and amortization(l)
|
36
|
|
49
|
|
105
|
|
153
|
|
Non-vehicle debt
interest, net
|
43
|
|
22
|
|
123
|
|
157
|
|
Vehicle debt-related
charges(a)(m)
|
9
|
|
8
|
|
25
|
|
62
|
|
Restructuring and
restructuring related charges(b)
|
8
|
|
22
|
|
29
|
|
72
|
|
Reorganization items,
net(d)
|
—
|
|
—
|
|
—
|
|
677
|
|
Pre-reorganization and
non-debtor financing charges(e)
|
—
|
|
1
|
|
—
|
|
41
|
|
Gain from the Donlen
Sale(f)
|
—
|
|
—
|
|
—
|
|
(400)
|
|
Unrealized (gains)
losses on financial instruments(g)
|
(55)
|
|
(1)
|
|
(120)
|
|
(1)
|
|
Change in fair value
of Public Warrants
|
(73)
|
|
(16)
|
|
(584)
|
|
(16)
|
|
Other
items(h)(o)
|
3
|
|
10
|
|
96
|
|
(62)
|
|
Adjusted Corporate
EBITDA
|
$
618
|
|
$
860
|
|
$
1,996
|
|
$
1,502
|
|
|
|
Supplemental
Schedule II (continued)
|
|
(a)
|
Represents debt-related
charges relating to the amortization of deferred financing costs
and debt discounts and premiums.
|
|
(b)
|
Represents charges
incurred under restructuring actions as defined in U.S. GAAP,
excluding impairments and asset write-downs. Also includes
restructuring related charges such as incremental costs incurred
directly supporting business transformation initiatives. For the
three and nine months ended September 30, 2022, charges incurred
related primarily to International RAC. For the three months ended
September 30, 2021, charges incurred were $15 million and $7
million for Corporate and International RAC, respectively. For the
nine months ended September 30, 2021, charges incurred were $41
million, $23 million and $8 million for Corporate, International
RAC and Americas RAC, respectively.
|
|
(c)
|
Represents incremental
expense associated with the amortization of other intangible assets
and depreciation of property and equipment relating to acquisition
accounting.
|
|
(d)
|
Represents charges
incurred associated with the Reorganization and emergence from
Chapter 11. The charges relate primarily to Corporate.
|
|
|
(in
millions)
|
Three Months Ended
September 30, 2021
|
|
Nine Months Ended
September 30, 2021
|
|
Professional fees and
other bankruptcy related costs
|
$
—
|
|
$
257
|
|
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
|
$
—
|
|
$
677
|
|
|
|
(e)
|
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. The amounts incurred for Corporate were $1 million for
the three months ended September 30, 2021, respectively. For
Corporate, Americas RAC, International RAC, and All other
operations were $17 million, $17 million, $5 million and $2 million
for the nine months ended September 30, 2021,
respectively.
|
|
(f)
|
Represents the gain
from the sale of the Company's Donlen business on March 30, 2021,
primarily associated with Corporate.
|
|
(g)
|
Represents unrealized
gains (losses) on derivative financial instruments, primarily
associated with Americas RAC.
|
|
(h)
|
Represents
miscellaneous items. For 2022, primarily includes bankruptcy
claims, certain professional fees and charges related to the
settlement of bankruptcy claims. For 2021, includes $100 million
due to the suspension of depreciation in 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.
|
|
Supplemental
Schedule II (continued)
|
|
(i) 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)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
Direct vehicle and
operating
|
$
1
|
|
$
(14)
|
|
$
(49)
|
|
$
45
|
|
Selling, general and
administrative
|
(13)
|
|
(22)
|
|
(63)
|
|
(91)
|
|
Interest expense,
net:
|
|
|
|
|
|
|
|
|
Vehicle
|
42
|
|
(8)
|
|
93
|
|
(81)
|
|
Non-vehicle
|
(5)
|
|
(4)
|
|
(21)
|
|
(54)
|
|
Total interest
expense, net
|
37
|
|
(12)
|
|
72
|
|
(135)
|
|
Other income (expense),
net
|
2
|
|
(9)
|
|
1
|
|
(17)
|
|
Reorganization items,
net
|
—
|
|
—
|
|
—
|
|
(677)
|
|
Gain from the Donlen
Sale
|
—
|
|
—
|
|
—
|
|
400
|
|
Change in fair value of
Public Warrants
|
73
|
|
16
|
|
584
|
|
16
|
|
Total
adjustments
|
$
100
|
|
$
(41)
|
|
$
545
|
|
$
(459)
|
|
|
|
(j)
|
Derived utilizing a
combined statutory rate of 25% and 24% for the three and nine
months ended September 30, 2022 and 2021, respectively, applied to
the respective Adjusted Pre-tax Income (Loss).
|
|
(k)
|
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.
|
|
(l)
|
Non-vehicle
depreciation and amortization expense for Americas RAC,
International RAC and Corporate for the three months ended
September 30, 2022 was $29 million, $3 million and $4 million,
respectively. For the three months ended September 30, 2021 was $42
million, $3 million, and $4 million for Americas RAC, International
RAC and Corporate, respectively. Non-vehicle depreciation and
amortization for Americas RAC, International RAC and Corporate for
the nine months ended September 30, 2022 were $85 million, $10
million and $10 million, respectively. For the nine months
ended September 30, 2021 were $130 million, $12 million, $2 million
and $9 million, respectively, for Americas RAC, International RAC,
All other operations and Corporate.
|
|
(m)
|
Vehicle debt-related
charges for Americas RAC and International RAC for the three months
ended September 30, 2022 were $8 million and $1 million,
respectively, and were $6 million and $2 million, respectively, for
the three months ended September 30, 2021. Vehicle debt-related
charges for Americas RAC and International RAC for the nine months
ended September 30, 2022 were $17 million and $8 million,
respectively. For the nine months ended September 30, 2021, vehicle
debt-related charges for Americas RAC, International RAC and All
other operations were $48 million, $12 million and $2 million,
respectively.
|
|
(n)
|
In 2022, includes
letter of credit fees recorded in Corporate.
|
|
(o)
|
In 2022, includes an
adjustment for certain non-cash stock-based compensation charges
recorded in Corporate.
|
|
Supplemental
Schedule III
|
|
HERTZ GLOBAL
HOLDINGS, INC.
|
|
RECONCILIATION OF
GAAP TO NON-GAAP MEASURE - ADJUSTED OPERATING CASH
FLOW
|
|
AND ADJUSTED FREE
CASH FLOW
|
|
Unaudited
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
(In millions)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
ADJUSTED OPERATING CASH FLOW AND ADJUSTED FREE CASH
FLOW:
|
|
|
|
Net cash provided by
(used in) operating activities
|
$
932
|
|
$
743
|
|
$
2,261
|
|
$
1,208
|
|
Depreciation and
reserves for revenue earning vehicles
|
(366)
|
|
(86)
|
|
(511)
|
|
(506)
|
|
Bankruptcy related
payments - post emergence
|
6
|
|
—
|
|
84
|
|
—
|
|
Adjusted operating cash
flow
|
572
|
|
657
|
|
1,834
|
|
702
|
|
Non-vehicle capital
asset expenditures, net
|
(41)
|
|
(17)
|
|
(94)
|
|
(24)
|
|
Adjusted operating cash
flow before vehicle investment
|
531
|
|
640
|
|
1,740
|
|
678
|
|
Net fleet growth after
financing
|
(26)
|
|
(121)
|
|
(672)
|
|
(1,948)
|
|
Noncontrolling
interests
|
—
|
|
(18)
|
|
—
|
|
(25)
|
|
Adjusted free cash
flow
|
$
505
|
|
$
501
|
|
$
1,068
|
|
$
(1,295)
|
|
|
|
|
|
|
|
|
|
CALCULATION OF NET FLEET GROWTH AFTER
FINANCING:
|
|
|
|
Revenue earning
vehicles expenditures
|
$
(1,764)
|
|
$
(1,060)
|
|
$
(7,853)
|
|
$
(5,196)
|
|
Proceeds from disposal
of revenue earning vehicles
|
1,583
|
|
746
|
|
4,470
|
|
1,945
|
|
Revenue earning
vehicles capital expenditures, net
|
(181)
|
|
(314)
|
|
(3,383)
|
|
(3,251)
|
|
Depreciation and
reserves for revenue earning vehicles
|
366
|
|
86
|
|
511
|
|
506
|
|
Financing activity
related to vehicles:
|
|
|
|
|
|
|
|
|
Borrowings
|
903
|
|
1,523
|
|
8,282
|
|
$
10,462
|
|
Payments
|
(1,130)
|
|
(1,343)
|
|
(5,954)
|
|
$
(9,463)
|
|
Restricted cash
changes, vehicle(a)
|
16
|
|
(73)
|
|
(128)
|
|
$
(202)
|
|
Net financing activity
related to vehicles
|
(211)
|
|
107
|
|
2,200
|
|
797
|
|
Net fleet growth after
financing
|
$
(26)
|
|
$
(121)
|
|
$
(672)
|
|
$
(1,948)
|
|
|
|
(a)
|
Amount presented for
the nine months ended September 30, 2021 excludes a $1 million
non-cash impact of foreign currency exchange rates.
|
|
Supplemental
Schedule IV
|
|
HERTZ GLOBAL
HOLDINGS, INC.
|
|
NET DEBT
CALCULATION
|
|
Unaudited
|
|
|
As of September 30, 2022
|
|
As of December 31, 2021
|
|
(In millions)
|
Vehicle
|
|
Non-Vehicle
|
|
Total
|
|
Vehicle
|
|
Non-Vehicle
|
|
Total
|
|
Term loans
|
$
—
|
|
$
1,529
|
|
$
1,529
|
|
$
—
|
|
$
1,539
|
|
$
1,539
|
|
Senior notes
|
—
|
|
1,500
|
|
1,500
|
|
—
|
|
1,500
|
|
1,500
|
|
U.S. vehicle financing
(HVF III)
|
8,865
|
|
—
|
|
8,865
|
|
7,001
|
|
—
|
|
7,001
|
|
International vehicle
financing (Various)
|
1,228
|
|
—
|
|
1,228
|
|
860
|
|
—
|
|
860
|
|
Other debt
|
72
|
|
12
|
|
84
|
|
93
|
|
16
|
|
109
|
|
Debt issue costs,
discounts and premiums
|
(68)
|
|
(62)
|
|
(130)
|
|
(33)
|
|
(69)
|
|
(102)
|
|
Debt as reported in the
balance sheet
|
10,097
|
|
2,979
|
|
13,076
|
|
7,921
|
|
2,986
|
|
10,907
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt issue costs,
discounts and premiums
|
68
|
|
62
|
|
130
|
|
33
|
|
69
|
|
102
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
—
|
|
1,006
|
|
1,006
|
|
—
|
|
2,258
|
|
2,258
|
|
Restricted
cash
|
203
|
|
—
|
|
203
|
|
77
|
|
—
|
|
77
|
|
Restricted cash and
restricted cash equivalents associated with Term C Loan
|
—
|
|
245
|
|
245
|
|
—
|
|
245
|
|
245
|
|
Net Debt
|
$
9,962
|
|
$
1,790
|
|
$
11,752
|
|
$
7,877
|
|
$
552
|
|
$
8,429
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate leverage
ratio(a)
|
|
|
0.7x
|
|
|
|
|
|
0.3x
|
|
|
|
|
|
(a)
|
Corporate leverage
ratio is calculated as non-vehicle net debt divided by LTM Adjusted
Corporate EBITDA.
|
|
Supplemental
Schedule V
|
|
HERTZ GLOBAL
HOLDINGS, INC.
|
|
KEY METRICS
CALCULATIONS
|
|
REVENUE, UTILIZATION
AND DEPRECIATION
|
|
Unaudited
|
|
Global
RAC
|
|
|
Three Months Ended
September 30,
|
|
Percent
Inc/(Dec)
|
|
Nine Months Ended
September 30,
|
|
Percent
Inc/(Dec)
|
|
($ in millions, except where noted)
|
2022
|
|
2021
|
|
|
2022
|
|
2021
|
|
|
Total RPD
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$
2,496
|
|
$
2,226
|
|
|
|
$
6,650
|
|
$
5,251
|
|
|
|
Foreign currency
adjustment(a)
|
50
|
|
(11)
|
|
|
|
70
|
|
(34)
|
|
|
|
Total Revenues -
adjusted for foreign currency
|
$
2,546
|
|
$
2,215
|
|
|
|
$
6,720
|
|
$
5,217
|
|
|
|
Transaction Days (in
thousands)
|
37,123
|
|
33,489
|
|
|
|
103,188
|
|
88,023
|
|
|
|
Total RPD (in
dollars)(b)
|
$
68.57
|
|
$
66.15
|
|
4 %
|
|
$
65.12
|
|
$
59.27
|
|
10 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue Per Unit Per
Month
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenues -
adjusted for foreign currency
|
$
2,546
|
|
$
2,215
|
|
|
|
$
6,720
|
|
$
5,217
|
|
|
|
Average Rentable
Vehicles (in whole units)(c)
|
503,508
|
|
456,566
|
|
|
|
483,083
|
|
410,662
|
|
|
|
Total revenue per unit
(in whole dollars)
|
$
5,056
|
|
$
4,852
|
|
|
|
$ 13,911
|
|
$ 12,704
|
|
|
|
Number of months in
period (in whole units)
|
3
|
|
3
|
|
|
|
9
|
|
9
|
|
|
|
Total RPU Per Month (in
whole dollars)(b)(c)
|
$
1,685
|
|
$
1,617
|
|
4 %
|
|
$
1,546
|
|
$
1,412
|
|
9 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle Utilization
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
37,123
|
|
33,489
|
|
|
|
103,188
|
|
88,023
|
|
|
|
Average Rentable
Vehicles (in whole units)(c)
|
503,508
|
|
456,566
|
|
|
|
483,083
|
|
410,662
|
|
|
|
Number of days in
period (in whole units)
|
92
|
|
92
|
|
|
|
273
|
|
273
|
|
|
|
Available Car Days (in
thousands)
|
46,339
|
|
42,010
|
|
|
|
131,955
|
|
112,226
|
|
|
|
Vehicle
Utilization(c)(d)
|
80 %
|
|
80 %
|
|
|
|
78 %
|
|
78 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation Per Unit Per Month
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of revenue
earning vehicles and lease
charges, net
|
$
294
|
|
$
61
|
|
|
|
$
341
|
|
$
420
|
|
|
|
Foreign currency
adjustment(a)
|
5
|
|
(1)
|
|
|
|
7
|
|
(4)
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and
lease charges
|
$
299
|
|
$
60
|
|
|
|
$
348
|
|
$
416
|
|
|
|
Average Vehicles (in
whole units)
|
532,740
|
|
473,492
|
|
|
|
509,086
|
|
420,753
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and
lease charges divided by Average Vehicles (in
whole
dollars)
|
$
561
|
|
$
126
|
|
|
|
$
683
|
|
$
989
|
|
|
|
Number of months in
period (in whole units)
|
3
|
|
3
|
|
|
|
9
|
|
9
|
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
187
|
|
$
42
|
|
NM
|
|
$
76
|
|
$
110
|
|
(30) %
|
|
|
Note: Global RAC
represents Americas RAC and International RAC segment information
on a combined basis and excludes Corporate and the Company's former
Donlen leasing operations which were sold on March 30,
2021.
|
|
NM - Not
meaningful
|
|
|
|
(a)
|
Based on December 31,
2021 foreign exchange rates.
|
|
(b)
|
Effective in the third
quarter of 2021, the Company revised its calculation of Total RPD
and Total RPU to include ancillary retail vehicle sales
revenues.
|
|
(c)
|
Effective in the first
quarter of 2022, the Company revised its calculation of Total RPU
and Vehicle Utilization to use Average Rentable Vehicles in the
denominator which excludes vehicles for sale on the Company's
retail lots or actively in the process of being sold through other
disposition channels.
|
|
(d)
|
Calculated as
Transaction Days divided by Available Car Days.
|
|
Supplemental
Schedule V (continued)
|
|
HERTZ GLOBAL
HOLDINGS, INC.
|
|
KEY METRICS
CALCULATIONS
|
|
REVENUE, UTILIZATION
AND DEPRECIATION
|
|
Unaudited
|
|
|
Americas
RAC
|
|
|
Three Months Ended
September 30,
|
|
Percent
Inc/(Dec)
|
|
Nine Months Ended
September 30,
|
|
Percent
Inc/(Dec)
|
|
($ in millions, except where noted)
|
2022
|
|
2021
|
|
|
2022
|
|
2021
|
|
|
Total RPD
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$
2,042
|
|
$
1,914
|
|
|
|
$
5,573
|
|
$
4,524
|
|
|
|
Foreign currency
adjustment(a)
|
1
|
|
(1)
|
|
|
|
1
|
|
(2)
|
|
|
|
Total Revenues -
adjusted for foreign currency
|
$
2,043
|
|
$
1,913
|
|
|
|
$
5,574
|
|
$
4,522
|
|
|
|
Transaction Days (in
thousands)
|
29,653
|
|
27,627
|
|
|
|
84,392
|
|
72,870
|
|
|
|
Total RPD (in
dollars)(b)
|
$
68.90
|
|
$
69.25
|
|
(1) %
|
|
$
66.05
|
|
$
62.06
|
|
6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue Per Unit Per
Month
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenues -
adjusted for foreign currency
|
$
2,043
|
|
$
1,913
|
|
|
|
$
5,574
|
|
$
4,522
|
|
|
|
Average Rentable
Vehicles (in whole units)(c)
|
397,488
|
|
372,326
|
|
|
|
390,071
|
|
337,597
|
|
|
|
Total revenue per unit
(in whole dollars)
|
$
5,140
|
|
$
5,138
|
|
|
|
$ 14,289
|
|
$ 13,395
|
|
|
|
Number of months in
period (in whole units)
|
3
|
|
3
|
|
|
|
9
|
|
9
|
|
|
|
Total RPU Per Month (in
whole dollars)(b)(c)
|
$
1,713
|
|
$
1,713
|
|
— %
|
|
$
1,588
|
|
$
1,488
|
|
7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle Utilization
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
29,653
|
|
27,627
|
|
|
|
84,392
|
|
72,870
|
|
|
|
Average Rentable
Vehicles (in whole units)(c)
|
397,488
|
|
372,326
|
|
|
|
390,071
|
|
337,597
|
|
|
|
Number of days in
period (in whole units)
|
92
|
|
92
|
|
|
|
273
|
|
273
|
|
|
|
Available Car Days (in
thousands)
|
36,585
|
|
34,261
|
|
|
|
106,538
|
|
92,261
|
|
|
|
Vehicle
Utilization(c)(d)
|
81 %
|
|
81 %
|
|
|
|
79 %
|
|
79 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation Per Unit Per Month
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of revenue
earning vehicles and lease
charges, net
|
$
252
|
|
$
24
|
|
|
|
$
220
|
|
$
314
|
|
|
|
Foreign currency
adjustment(a)
|
—
|
|
—
|
|
|
|
—
|
|
1
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and
lease charges
|
$
252
|
|
$
24
|
|
|
|
$
220
|
|
$
315
|
|
|
|
Average Vehicles (in
whole units)
|
425,596
|
|
387,368
|
|
|
|
415,110
|
|
346,032
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and
lease charges divided by Average Vehicles (in
whole
dollars)
|
$
593
|
|
$
62
|
|
|
|
$
529
|
|
$
910
|
|
|
|
Number of months in
period (in whole units)
|
3
|
|
3
|
|
|
|
9
|
|
9
|
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
198
|
|
$
21
|
|
NM
|
|
$
59
|
|
$
101
|
|
(41) %
|
|
NM - Not
meaningful
|
|
(a)
|
Based on December 31,
2021 foreign exchange rates.
|
|
(b)
|
Effective in the third
quarter of 2021, the Company revised its calculation of Total RPD
and Total RPU to include ancillary retail vehicle sales
revenues.
|
|
(c)
|
Effective in the first
quarter of 2022, the Company revised its calculation of Total RPU
and Vehicle Utilization to use Average Rentable Vehicles in the
denominator which excludes vehicles for sale on the Company's
retail lots or actively in the process of being sold through other
disposition channels.
|
|
(d)
|
Calculated as
Transaction Days divided by Available Car Days.
|
|
Supplemental
Schedule V (continued)
|
|
HERTZ GLOBAL
HOLDINGS, INC.
|
|
KEY METRICS
CALCULATIONS
|
|
REVENUE, UTILIZATION
AND DEPRECIATION
|
|
Unaudited
|
|
|
International
RAC
|
|
|
Three Months Ended
September 30,
|
|
Percent
Inc/(Dec)
|
|
Nine Months Ended
September 30,
|
|
Percent
Inc/(Dec)
|
|
($
in millions, except where noted)
|
2022
|
|
2021
|
|
|
2022
|
|
2021
|
|
|
Total RPD
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$
454
|
|
$
312
|
|
|
|
$ 1,077
|
|
$
727
|
|
|
|
Foreign currency
adjustment(a)
|
49
|
|
(10)
|
|
|
|
69
|
|
(32)
|
|
|
|
Total Revenues -
adjusted for foreign currency
|
$
503
|
|
$
302
|
|
|
|
$ 1,146
|
|
$
695
|
|
|
|
Transaction Days (in
thousands)
|
7,470
|
|
5,862
|
|
|
|
18,796
|
|
15,153
|
|
|
|
Total RPD (in
dollars)(b)
|
$
67.28
|
|
$
51.52
|
|
31 %
|
|
$ 60.98
|
|
$ 45.87
|
|
33 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue Per Unit Per
Month
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenues -
adjusted for foreign currency
|
$
503
|
|
$
302
|
|
|
|
$ 1,146
|
|
$
695
|
|
|
|
Average Rentable
Vehicles (in whole units)(c)
|
106,020
|
|
84,241
|
|
|
|
93,012
|
|
73,066
|
|
|
|
Total revenue per unit
(in whole dollars)
|
$
4,740
|
|
$
3,585
|
|
|
|
$
12,323
|
|
$ 9,513
|
|
|
|
Number of months in
period (in whole units)
|
3
|
|
3
|
|
|
|
9
|
|
9
|
|
|
|
Total RPU Per Month (in
whole dollars)(b)(c)
|
$
1,580
|
|
$
1,195
|
|
32 %
|
|
$ 1,369
|
|
$ 1,057
|
|
30 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle Utilization
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction Days (in
thousands)
|
7,470
|
|
5,862
|
|
|
|
18,796
|
|
15,153
|
|
|
|
Average Rentable
Vehicles (in whole units)(c)
|
106,020
|
|
84,241
|
|
|
|
93,012
|
|
73,066
|
|
|
|
Number of days in
period (in whole units)
|
92
|
|
92
|
|
|
|
273
|
|
273
|
|
|
|
Available Car Days (in
thousands)
|
9,754
|
|
7,749
|
|
|
|
25,417
|
|
19,965
|
|
|
|
Vehicle
Utilization(c)(d)
|
77 %
|
|
76 %
|
|
|
|
74 %
|
|
76 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation Per Unit Per Month
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of revenue
earning vehicles and lease
charges, net
|
$
42
|
|
$
37
|
|
|
|
$
121
|
|
$
106
|
|
|
|
Foreign currency
adjustment(a)
|
5
|
|
(1)
|
|
|
|
7
|
|
(5)
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and
lease charges
|
$
47
|
|
$
36
|
|
|
|
$
128
|
|
$
101
|
|
|
|
Average Vehicles (in
whole units)
|
107,144
|
|
86,124
|
|
|
|
93,976
|
|
74,721
|
|
|
|
Adjusted depreciation
of revenue earning vehicles and
lease charges divided by Average Vehicles
(in
whole dollars)
|
$
437
|
|
$
412
|
|
|
|
$ 1,366
|
|
$ 1,351
|
|
|
|
Number of months in
period (in whole units)
|
3
|
|
3
|
|
|
|
9
|
|
9
|
|
|
|
Depreciation Per Unit
Per Month (in whole dollars)
|
$
146
|
|
$
137
|
|
6 %
|
|
$
152
|
|
$
150
|
|
1 %
|
|
|
|
(a)
|
Based on December 31,
2021 foreign exchange rates.
|
|
(b)
|
Effective in the third
quarter of 2021, the Company revised its calculation of Total RPD
and Total RPU to include ancillary retail vehicle sales
revenues.
|
|
(c)
|
Effective in the first
quarter of 2022, the Company revised its calculation of Total RPU
and Vehicle Utilization to use Average Rentable Vehicles in the
denominator which excludes vehicles for sale on the Company's
retail lots or actively in the process of being sold through other
disposition channels.
|
|
(d)
|
Calculated as
Transaction Days divided by Available Car Days.
|
NON-GAAP MEASURES AND KEY METRICS
The term "GAAP"
refers to accounting principles generally accepted in the United States. Adjusted EBITDA is the
Company's segment measure of profitability and complies with GAAP
when used in that context.
NON-GAAP MEASURES
Non-GAAP measures are not
recognized measurements under GAAP. When evaluating the Company's
operating performance or liquidity, investors should not consider
non-GAAP measures in isolation of, superior to, or as a substitute
for measures of the Company's financial performance as determined
in accordance with GAAP.
Adjusted Net Income (Loss) and Adjusted Diluted Earnings
(Loss) Per Share ("Adjusted EPS")
Adjusted Net Income (Loss) represents income or loss
attributable to the Company as adjusted to eliminate the impact of
GAAP income tax; vehicle and non-vehicle debt-related charges;
restructuring and restructuring related charges; acquisition
accounting-related depreciation and amortization; reorganization
items, net; pre-reorganization and non-debtor financing charges;
gain from the sale of a business; change in fair value of Public
Warrants; unrealized (gains) losses on financial instruments and
certain other miscellaneous items on a pre-tax basis. Adjusted Net
Income (Loss) includes a provision (benefit) for income taxes
derived utilizing a combined statutory rate. The combined statutory
rate is management's estimate of the Company's long-term tax rate.
Its most comparable GAAP measure is net income (loss) attributable
to the Company.
Adjusted EPS represents Adjusted Net Income (Loss) on a per
diluted share basis using the weighted-average number of diluted
shares outstanding for the period. Its most comparable GAAP measure
is diluted earnings (loss) per share.
Adjusted Net Income (Loss) and Adjusted EPS are important
operating metrics because they allow management and investors to
assess operational performance of the Company's business, exclusive
of the items mentioned above that are not operational in nature or
comparable to those of the Company's competitors.
Adjusted Corporate EBITDA and Adjusted Corporate EBITDA
Margin
Adjusted Corporate EBITDA represents income or loss attributable
to the Company as adjusted to eliminate the impact of GAAP income
tax; non-vehicle depreciation and amortization; non-vehicle debt
interest, net; vehicle debt-related charges; restructuring and
restructuring related charges; reorganization items, net;
pre-reorganization and non-debtor financing charges; gain from the
sale of a business; change in fair value of Public Warrants;
unrealized (gains) losses on financial instruments and certain
other miscellaneous items.
Adjusted Corporate EBITDA Margin is calculated as the ratio of
Adjusted Corporate EBITDA to total revenues.
Management uses these measures as operating performance metrics
for internal monitoring and planning purposes, including the
preparation of the Company's annual operating budget and monthly
operating reviews, and analysis of investment decisions,
profitability and performance trends. These measures enable
management and investors to isolate the effects on profitability of
operating metrics most meaningful to the business of renting and
leasing vehicles. They also allow management and investors to
assess the performance of the entire business on the same basis as
its reportable segments. Adjusted Corporate EBITDA is also utilized
in the determination of certain executive compensation. Its most
comparable GAAP measure is net income (loss) attributable to the
Company.
Adjusted operating cash flow and adjusted free cash
flow
Adjusted operating cash flow represents net cash provided by
operating activities net of the non-cash add back for vehicle
depreciation and reserves, and exclusive of bankruptcy related
payments made post emergence. Adjusted operating cash flow is
important to management and investors as it provides useful
information about the amount of cash generated from operations when
fully burdened by fleet costs.
Adjusted free cash flow represents adjusted operating cash flow
plus the impact of net non-vehicle capital expenditures and net
fleet growth after financing. Adjusted free cash flow is important
to management and investors as it provides useful information about
the amount of cash available for, but not limited to, the reduction
of non-vehicle debt, share repurchase and acquisition.
KEY METRICS
Available Car Days
Available Car Days represents Average Rentable Vehicles
multiplied by the number of days in a given period.
Average Vehicles ("Fleet Capacity" or
"Capacity")
Average Vehicles is determined using a simple average of the
number of vehicles in the fleet whether owned or leased by the
Company at the beginning and end of a given period.
Average Rentable Vehicles
Average Rentable Vehicles reflects Average Vehicles excluding
vehicles for sale on the Company's retail lots or actively in the
process of being sold through other disposition channels.
Depreciation Per Unit Per Month ("Depreciation Per Unit"
or "DPU")
Depreciation Per Unit Per Month represents the amount of average
depreciation expense and lease charges per vehicle per month,
exclusive of the impacts of foreign currency exchange rates so as
not to affect the comparability of underlying trends. This metric
is important to management and investors as it reflects how
effectively the Company is managing the costs of its vehicles and
facilitates comparisons with other participants in the vehicle
rental industry.
Total Revenue Per Transaction Day ("Total RPD"or "RPD";
also referred to as "pricing")
Total RPD represents revenue generated per transaction day,
excluding the impact of foreign currency exchange rates so as not
to affect the comparability of underlying trends. This metric is
important to management and investors as it represents a measure of
changes in the underlying pricing in the vehicle rental business
and encompasses the elements in vehicle rental pricing that
management has the ability to control.
Historically, the Company excluded revenue generated from
ancillary retail vehicles sales. Effective in the third quarter
2021, the Company revised its calculation of Total RPD to include
ancillary retail vehicle sales revenues to better align with
current industry practice. Prior periods shown have been restated
to conform with the revised definition.
Total Revenue Per Unit Per Month ("Total RPU" or "Total
RPU Per Month")
Total RPU Per Month represents the amount of revenue generated
per vehicle in the rental fleet each month, excluding the impact of
foreign currency exchange rates so as not to affect the
comparability of underlying trends. This metric is important to
management and investors as it provides a measure of revenue
productivity relative to the number of vehicles in our rental fleet
whether owned or leased, or asset efficiency.
Historically, the Company excluded revenue generated from
ancillary retail vehicles sales. Effective in the third quarter
2021, the Company revised its calculation of Total RPU to include
ancillary retail vehicle sales revenues to better align with
current industry practice. Also, historically, the company used
Average Vehicles as the denominator to calculate Total RPU and
effective in the first quarter of 2022, the Company revised the
calculation to use Average Rentable Vehicles. Prior periods shown
have been restated to conform with the revised definition.
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")
Effective in the first quarter of 2022, in connection with the
appointment of the new CEO (who serves as our Chief Operating
Decision Maker) and arising from significantly increased activity
in vehicle dispositions, we began using Average Rentable Vehicles
when calculating Available Car Days, Total RPU and Utilization
instead of Average Vehicles. Average Rentable Vehicles excludes
vehicles for sale on the Company's retail lots or actively in the
process of being sold through other disposition channels. We
believe this is a better measure of the productivity of our rental
fleet as it is unaffected by fluctuations in disposition activity.
Prior periods have been restated to conform with the revisions, as
appropriate.
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SOURCE Hertz Global Holdings, Inc.