H&E Equipment Services, Inc. (NASDAQ: HEES) today announced operating results for the fourth quarter and year ended December 31, 2010.
FOURTH QUARTER 2010 HIGHLIGHTS
- Revenues increased 26.8% to $174.6 million versus $137.7 million a year ago. Revenues increased 13.5% from the third quarter of 2010.
- Rental revenues increased 26.3% from a year ago and 6.8% from the third quarter.
- New equipment sales increased 71.7% from a year ago and 32.8% from the third quarter.
- Gross margins were 23.9% as compared to 22.3% a year ago. EBITDA margins were 15.4% versus 14.2% a year ago (adjusted to remove a $9.0 million goodwill impairment charge in 2009).
- Rental gross margins increased to 39.2% in the fourth quarter compared to 27.1% a year ago and 37.5% in the third quarter.
- Average time utilization (based on units available for rent) increased to 62.7% compared to 53.3% last year and 62.3% in the third quarter. Average time utilization (based on original equipment cost) increased to 67.0%, compared to 55.4% a year ago and 65.9% in the third quarter.
- Rental rates improved 2.2% sequentially from the third quarter, the second consecutive quarter of sequential gains in rental rates. Declines in rental rates on a year-over-year basis continued to moderate and were down 1.0% compared to the fourth quarter of 2009.
- Dollar utilization was 30.2% in the fourth quarter compared to 23.9% a year ago and 29.2% in the third quarter.
- Rental fleet age at December 31, 2010 was 43 months compared to an industry average of approximately 53 months.
“With significant gains on both a year-over-year and sequential basis, we are pleased with our performance during the fourth quarter. We continue to be encouraged by the improvements in market conditions,” said John Engquist, H&E Equipment Services’ president and chief executive officer. “Year-over-year, our total revenues increased in excess of 25%, driven by continued growth in our rental business and higher demand for new equipment. The quarter’s results also reflected improved gross margins and EBITDA margins. Despite typical seasonal patterns in the latter part of the fourth quarter, our business delivered strong sequential improvement with double-digit increases in revenues, gross profit and EBITDA.”