HERTZ GLOBAL HOLDINGS, INC. 
HERTZ GLOBAL HOLDINGS INC.
Q1 2024 EARNINGS PRESENTATION
April 25, 2024
IMPORTANT DISCLOSURES
FORWARD-LOOKING STATEMENTS
Certain statements made within this presentation contain forward-looking statements. Forward-looking statements are not guarantees of future performance and by their nature are subject to inherent uncertainties. Actual results may differ materially. Any forward-looking information relayed in this presentation speaks only as of April 25, 2024, and Hertz Global Holdings, Inc. ("Hertz" or the "Company") undertakes no obligation to update that information to reflect changed circumstances.
Additional information concerning these statements,including factors that could cause our actual results to differ, is contained in the Company's press release regarding its first quarter 2024 results issued on April 25, 2024, and can also be found in the most recent filings we make with the Securities and Exchange Commission, including our Annual Report on Form 10-K. These filings are made available on the SEC's website and the Investor Relations section of the Hertz website.
NON-GAAP MEASURES AND KEY METRICS
The following non-GAAP measures and key metrics are used in the presentation:
• | Adjusted Corporate EBITDA | • | Available Rental Car Days |
• | Adj. Corp. EBITDA Margin | • | Average Rentable Vehicles |
• Adjusted Free Cash Flow | • | Average Vehicles | |
• DOE per Transaction Day | • | Depreciation Per Unit (DPU) | |
• | Net Corporate Leverage | • | Total Revenue Per Day (RPD) |
• | Net Non-Vehicle Debt | • | Transaction Days |
• | Vehicle Utilization |
See Appendix for definitions of key metrics and reconciliations of non-GAAP measures to the most directly comparable GAAP measure where applicable.
INVESTOR PRESENTATION | Q1 2024 | 2 |
HERTZ - A GLOBAL LEADER IN CAR RENTAL
106 years of operations
11,400 $9.4B 550K
locations | annual revenue | vehicles |
160 27,000 25M
countries | employees | annual rentals |
INVESTOR PRESENTATION | Q1 2024 | Note: Data For Full Year 2023 | 3 |
GLOBAL Q1 RESULTS - YEAR OVER YEAR
Q1 2023 | Q1 2024 | |||
REVENUE | $2.0B | $2.1B | 2% | |
TRANSACTION DAYS | 33.8M | 36.9M | 9% | |
RPD | $60.85 | $56.68 | (7)% | |
AVERAGE FLEET | 505K | 547K | 9% | |
UTILIZATION | 77% | 76% | (120)bps | |
DPU | $253 | $592 | NM | |
DOE/TRANSACTION DAY . . . | $36.13 | $37.08 | 3% | |
ADJ. CORP. EBITDA | $237M | $(567)M | NM | |
ADJ. FREE CASH FLOW . . . . | $(83)M | $(729)M | NM |
DRIVERS
Continued strong overall demand environment
Sustained volume growth across leisure and rideshare
Decline moderated to 3% in March 2024
Fleet was elevated entering 2024; active defleeting throughout the quarter tightened fleet levels; core rental fleet up 2% YoY in March
Impacted by elevated fleet levels entering 2024
Driven by deterioration in estimated future residual values and losses on sale of ICE vehicles compared to gains in Q1'23, as well as fair value adjustments and disposition losses on EVs held for sale of $119
Flat year over year excluding collision and damage in both periods; March DOE per Day showed progress at $35.22
Driven mainly by a $588 million increase in vehicle depreciation, of which $195 million related to EVs held for sale
Driven by lower EBITDA
See Appendix for definitions of key metrics and reconciliations of non-GAAP measures to the most directly comparable GAAP measure where applicable.
INVESTOR PRESENTATION | Q1 2024 | 4 |
GLOBAL Q1 RESULTS - SEQUENTIAL
Q4 2023 | Q1 2024 | |||
REVENUE | $2.2B | $2.1B | (5)% | |
TRANSACTION DAYS | 37.6M | 36.9M | (2)% | |
RPD | $58.09 | $56.68 | (2)% | |
AVERAGE FLEET | 554K | 547K | (1)% | |
UTILIZATION | 78% | 76% | (100)bps | |
DPU | $498 | $592 | 19% | |
DOE/TRANSACTION DAY . . . | $36.92 | $37.08 | -% | |
ADJ. CORP. EBITDA | $(382)M | $(567)M | 48% | |
ADJ. FREE CASH FLOW . . . . | $(128)M | $(729)M | NM |
DRIVERS
In-line with normal seasonality of the business
In-line with normal seasonality of the business
In-line with normal seasonality of the business
Fleet was elevated entering 2024; active defleeting throughout the quarter tightened fleet levels
Impacted by elevated fleet levels entering 2024
Driven by deterioration in estimated future residual values
Flat despite reduced transaction volume; targeted cost reduction program underway. March DOE per Day showed progress at $35.22
Driven mainly by a $191 million increase in vehicle depreciation excluding the impact of EVs held for sale in both periods
Driven by lower EBITDA
See Appendix for definitions of key metrics and reconciliations of non-GAAP measures to the most directly comparable GAAP measure where applicable. | NM = Not meaningful |
INVESTOR PRESENTATION | Q1 2024 | 5 |
REVENUE - RATE AND VOLUME
GLOBAL RPD | |||||
~35% | |||||
$61.62 | $63.04 | ||||
$60.85$56.68 | $58.15 | ||||
$46.73 | |||||
$42.50 | $43.07 | $43.86 | |||
Q1 | Q2 | Q3 | Q4 | |||||||||||
2019 | 2023 | 2024 | ||||||||||||
TRANSACTION DAYS | ||||||||||||||
45.7 | 54.3 | 57.0 | 49.0 | |||||||||||
39.7 | 43.1 | |||||||||||||
33.8 | 36.9 | 37.6 | ||||||||||||
Q1 | Q2 | Q3 | Q4 | |||||||||||
2019 | 2023 | 2024 | ||||||||||||
days in millions
Revenue Dynamics
- Q1'24 revenue of $2.1B comparable to Q1'2019; +2% YoY
- RPD +35% versus Q1'19
- March '24 RPD 12% higher than January '24
- Days (20%) versus Q1'19
Rate per Day Dynamics
- Key components impacting RPD:
- Demand
- Seasonality
- Customer channel mix
- Length of rental
- Brand
- Insurance replacement and rideshare customer channels carry lower RPD than leisure but have greater utilization and lower direct operating expenses
See Appendix for definitions of key metrics and reconciliations of non-GAAP measures to the most directly comparable GAAP measure where applicable.
INVESTOR PRESENTATION | Q1 2024 | 6 |
FLEET - NEW CAR PRICES / DPU
New Vehicle Supply Index1 vs. New Vehicle Price Index
Values Indexed to 2019
2019 | 2021 | 2023 | +63% |
2020 2022
(18)%
100 | 100 | |||||||
U.S. New Vehicle | Hertz New Vehicle |
Supply | Price (by Model Year) |
- Supply reduction drove higher costs: driven by pricing and constraints on vehicle class mix options
- Increased requirement to purchase used vehicles
- New car prices beginning to decrease as supply constraints relax, we expect further decreases from here
1U.S Bureau of Economic Analysis *FY 2023 DPU excludes impact of EV s held for sale
Depreciation Per Unit Per Month*
FY | FY | Q1 2024 |
2022 | 2023 |
- DPU was driven higher by:
- Deterioration in expected forward residual values (Q1'24)
- Elevated new car prices and constrained mix of vehicles
- Benefits of fleet refresh:
- Lower depreciation, interest and maintenance expense
- Optimized fleet mix
- Enhanced customer satisfaction
- We expect DPU in the low $300's when fleet refresh is complete
INVESTOR PRESENTATION | Q1 2024 | 7 |
EV UPDATE
Q1 2024 Update | ||||
Q1 2024 | ||||
EVs Held for Sale | Qty | Impact | ||
First EV Disposal Group | 20K | $154M | ||
Second EV Disposal Group | 10K | |||
EV Dispositions | (10)K | $41M | ||
Total charges in Q1 2024 | $195M | |||
EVs Held for Sale at March 31, 2024 | 20K | |||
Benefits from downsizing EV fleet
- Eliminates oversupply of EVs
- Improves RPD and utilization of EVs
- Reduces vehicle carrying costs and DOE
- Increases field team productivity
Strong EV sales in Q1'24
Focused deployment and utilization of EV fleet against high value opportunities
- Rideshare
- Off-airport
- Airport
EVs deployed outside of rideshare expected to comprise ~5% of global fleet at end of 2024
See Appendix for definitions of key metrics and reconciliations of non-GAAP measures to the most directly comparable GAAP measure where applicable.
INVESTOR PRESENTATION | Q1 2024 | 8 |
PATH TO INCREMENTAL $500M OF ADJUSTED CORPORATE EBITDA
Profitable
Revenue
Growth
Yield
Improvement
on Assets
Productivity
and Cost
Benefit
Core Focus Areas
Staffing and | Footprint |
third party | |
Direct operating | Procurement and |
expense | spend control |
Technology |
~$250M of productivity and cost benefit in 2024
(separate from EV sales plan benefit)
INVESTOR PRESENTATION | Q1 2024 | 9 |
CORPORATE DEBT AND LIQUIDITY
NON-VEHICLE DEBT MATURITY PROFILE
AT MARCH 31, 2024*
$1,696
$968 | $1,000 |
$15 | $18 | $18 | ||||||||||
2024 | 2025 | 2026 | 2027 | 2028 | 2029 |
dollars in millions
*Excludes $245 million Term C loan (maturing June 2028) since the cash is restricted to collateralize letters of credit.
SOLID LIQUIDITY POSITION
AT MARCH 31, 2024
- Liquidity of $1.3B
- $465M of unrestricted cash
- $866M available under First Lien RCF
- Net Non-vehicle Debt of $3.3B
- Vehicle debt facilities carry blended average cost of ~4%, with ~70% fixed rate, thereby mitigating future interest expense risk
- Amended the First Lien Revolving Credit Facility to temporarily increase the consolidated first lien leverage ratios through Q1'25
See Appendix for definitions of key metrics and reconciliations of non-GAAP measures to the most directly comparable GAAP measure where applicable.
INVESTOR PRESENTATION | Q1 2024 | 10 |
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Disclaimer
Hertz Global Holdings Inc. published this content on 24 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 May 2024 09:39:03 UTC.
