Hertz Global Holdings HTZ incurred a loss (excluding $2.35 from non-recurring items) of $3.51 per share in second-quarter 2020, wider than the Zacks Consensus Estimate of a loss of $2.33. In the year-ago period, the company reported earnings of 74 cents per share. Similar to the first quarter, second-quarter results were affected by decreased demand for rental cars amid coronavirus concerns. However, the impact in the second quarter is much greater.
Quarterly revenues of $832 million also missed the Zacks Consensus Estimate of $918.9 million. The top line declined 66.9% year over year due to weak performance by the U.S. and International Rental Car segments.
In the quarter under review, the U.S. Rental Car segment generated revenues of $533 million, down 70% year over year. While airport rental-car volumes declined 82% due to weakness in air-travel demand caused by coronavirus, off airport volumes decreased 47%.
Vehicle utilization declined to 28% from 82% a year ago. Transaction days fell 69% year over year. Total revenue per transaction day (“RPD”) decreased 10%. Adjusted EBITDA for the segment was ($470 million) in the second quarter against $156 million a year ago.
Segmental direct-vehicle and operating expenses dropped 47% to $561 million. Meanwhile, interest expenses climbed 8%. However, selling, general and administrative expenses declined 47% year over year. Costs reduced due to strict cost-control measures and low volumes.
The International Rental Car segment generated revenues of $135 million, down 76% year over year. Airport rental-car volumes plunged 84%, while off-airport volumes dropped 47%. Vehicle utilization fell to 36% from 77% in the year-ago quarter. Segmental RPD declined 24% year over year.
Segmental direct vehicle and operating costs fell 59% year over year to $136 million. While interest expenses contracted 3%, selling, general and administrative expenses fell 28% year over year. Adjusted EBITDA for the segment came in at ($127 million) compared with $56 million in second-quarter 2019. Meanwhile, revenues from all other operations dipped 1% to $164 million.
Hertz Global Holdings, Inc Price, Consensus and EPS Surprise
Hertz Global Holdings, Inc price-consensus-eps-surprise-chart | Hertz Global Holdings, Inc Quote
Balance Sheet Highlights
The Zacks Rank #3 (Hold) company exited the second quarter with cash and cash equivalents of $1,366 million compared with $865 million at the end of 2019. Restricted cash and cash equivalents at the end of the period came in at $945 million compared with $495 million at 2019-end. As of Jun 30, 2020, total debt amounted to $12.98 billion compared with $17.09 billion as of Dec 31, 2019.
Let’s take a look into some other Zacks Transportation sector companies’ second-quarter earnings results.
Kirby Corporation’s KEX second-quarter earnings of 42 cents per share were in line with the Zacks Consensus Estimate. The bottom line plunged 46.8% year over year. This Zacks Rank #5 (Strong Sell) company’s total revenues of $541.2 million lagged the Zacks Consensus Estimate of $618.4 million and declined 29.8% year over year.
United Parcel Service’s UPS earnings (excluding 10 cents from non-recurring items) per share of $2.13 surpassed the Zacks Consensus Estimate of $1.04. The bottom line also improved 8.7% year over year. The company, sporting a Zacks Rank #1 (Strong Buy), generated revenues worth $20,459 million in the quarter, outperforming the Zacks Consensus Estimate of $17,344.4 million. Moreover, the top line improved 13.4% on a year-over-year basis. You can see the complete list of today's Zacks #1 Rank stocks here.
Norfolk Southern Corporation’s NSC second-quarter earnings of $1.53 per share surpassed the Zacks Consensus Estimate of $1.39. However, the bottom line plunged 43% on a year-over-year basis. Railway operating revenues in the quarter under review came in at $2,085 million, edging past the Zacks Consensus Estimate of $2,061.5 million. This Zacks Rank #3 company’s top line however declined 29% year over year.
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