H&E Equipment Services, Inc. (NASDAQ: HEES) today announced results for the second quarter ended June 30, 2010.
SECOND QUARTER 2010 HIGHLIGHTS
- Achieved sequential revenue growth of 14.2%. Growth was achieved in all operating segments.
- Increased profitability in excess of revenue growth. Sequential gross profit increased 35.6% and sequential EBITDA growth was 69.6%, resulting in higher margins as a percentage of revenues.
- Increased average time utilization for the quarter to 54.9%, improving from 49.7% in the first quarter. Average time utilization in the second quarter of 2010 was nearly flat with year ago levels of 55.3%.
- Began reinvesting in rental capital expenditures with improving market conditions. Net rental capital expenditures (including inventory transfers) were $6.9 million, the first quarter of positive net spending since late 2008.
- Extended the maturity date of our asset-based revolving credit facility until 2015.
“Our business delivered solid sequential improvements in the second quarter despite ongoing challenges in the markets we serve and, as we expected, the first quarter was a low point of the cycle,” said John Engquist, H&E Equipment Services’ president and chief executive officer. “Revenue for all of our segments increased sequentially from the first quarter resulting in a 14.2% increase in total revenue. Our rental business continued to improve as units on rent again increased, resulting in a 14.3% gain in rental revenue and a 63.4% gain in rental gross profit from the first quarter. While new and used equipment sales improved from the first quarter, demand remains weak compared to a year ago as access to lending and economic uncertainty continue to impact large capital purchases. Our EBITDA increased 69.6% compared to the first quarter which is the largest sequential increase we have ever experienced. While we are cautious regarding the market conditions for the remainder of this year, we are encouraged by the current activity. June was an inflection point for our rental business as we experienced year-over-year improvements in our rental gross margin and dollar utilization for the first time in more than two years.”