Hertz Reports Strong Fourth Quarter and Record Full Year 2022

Hertz Global Holdings, Inc. reported results for its fourth quarter and full year 2022.

For the fourth quarter 2022, the Company generated total revenues of $2.0 billion, up 4% from the fourth quarter of 2021, and up 7% on a constant currency basis. RPD and RPU were at fourth quarter record levels and volume was up 3% led by post-pandemic demand recovery.

Depreciation continued to normalize during the quarter. Excluding litigation settlements of $168 million in the quarter, direct operating expense per transaction day was $33, down $2 from the third quarter 2022, demonstrating improved operating leverage. Net income was $116 million and Adjusted Corporate EBITDA was $309 million, a 15% margin. For the quarter, loss per share was $0.01 and adjusted earnings per share was $0.50.

Operating cash flow was $277 million for the quarter. Fleet capex of $312 million was a source of cash in the fourth quarter, driven by fleet rejuvenation and seasonal defleeting. As a result, adjusted free cash flow was $424 million, reflecting a 137% conversion from Adjusted Corporate EBITDA. The Company acquired 19 million shares, or 6% of its common stock, during the quarter.

“Our strong results in the fourth quarter and record performance last year reflect a commitment to customers – from leisure and corporate travelers to ride share drivers. With a focus on asset return and risk management, we showed better operating performance, more disciplined fleet management and a commitment to financial returns,” said Stephen Scherr, Hertz chair and chief executive officer. “Our team delivered on renewed demand for travel, which is continuing. In 2023, we will build on our progress to grow our business across the Hertz, Dollar, and Thrifty brands. We look to our investments in electrification and technology to yield increasing operating leverage and improved returns and an even better product to our customers around the world.”

HIGHLIGHTS

Q4 2022

—Revenue of $2.0 billion

—GAAP net income of $116 million, or $(0.01) per diluted share

—Adjusted net income of $173 million, or $0.50 per diluted share

—Adjusted Corporate EBITDA of $309 million, a 15% margin

—Operating cash flow of $277 million

—Adj. operating cash flow of $156 million; adj. free cash flow of $424 million

FY 2022

—Revenue of $8.7 billion

—Record GAAP net income of $2.1 billion, or $3.36 per diluted share

—Record adjusted net income of $1.5 billion, or $3.74 per diluted share

—Record Adjusted Corporate EBITDA of $2.3 billion, a 27% margin

—Operating cash flow of $2.5 billion

—Record adj. operating cash flow of $2.0 billion and adj. free cash flow of $1.5 billion

—Corporate liquidity of $2.5 billion at December 31st, including $943 million in unrestricted cash

—Company repurchased 128 million common shares during 2022, a 28.5% reduction of its capital base