H&E Equipment Services, Inc. (NASDAQ: HEES) today announced results for the second quarter ended June 30, 2011.
SECOND QUARTER 2011 HIGHLIGHTS:
- Revenues increased 40.7% to $184.3 million versus $131.0 million a year ago. Growth was achieved in all operating segments.
- Net income increased to $2.7 million in the second quarter compared to a net loss of $7.1 million a year ago.
- EBITDA increased 89.1% to $35.2 million from $18.6 million, yielding a margin of 19.1% compared to 14.2% of revenues a year ago.
- New equipment sales increased 100.0% from a year ago driven by increased crane and earthmoving sales.
- Rental revenues increased 33.8%, or $14.1 million to $55.8 million on higher time utilization, better rates, and a larger fleet compared to a year ago.
- Gross margins were 25.9% as compared to 24.7% a year ago. Rental gross margins increased to 40.7% compared to 31.1% a year ago.
- Average time utilization (based on units available for rent) increased to 67.1% compared to 54.9% last year and 61.0% last quarter. Average time utilization (based on original equipment cost) increased to 70.0% compared to 57.9% a year ago and 64.9% in the first quarter of 2011.
- Achieved positive year-over-year and sequential rental pricing in the quarter. Average rental rates increased 6.4% compared to a year ago and improved 4.2% from the first quarter of this year.
- Dollar utilization was 31.0% as compared to 25.3% a year ago.
- Average rental fleet age at June 30, 2011 was 43 months, down slightly from the end of the last quarter and significantly younger than the industry average age of 53 months.
“With 41% revenue growth on a year-over-year basis and 37% on a sequential basis, the current trends in our business are particularly encouraging despite a commercial construction environment that remains relatively dormant,” said John Engquist, H&E Equipment Services’ president and chief executive officer. “The momentum in our rental business continued as revenue climbed 33.8%, gross profit increased 75.3%, and gross margins grew to 40.7% compared to 31.1% a year ago. We were pleased with the progress that we made on rental rates during the quarter. Rental rates increased 6.4% from a year ago and 4.2% from the first quarter. Our new equipment sales were particularly strong in the second quarter as strong demand for cranes and earthmoving machines resulted in a 100.0%, or $29.0 million, revenue increase from a year ago. As a result of significant revenue growth in all of our operating segments, gross profit increased 47.6%, EBITDA grew 89.1% and we achieved bottom line profitability with EPS improving $0.28 from a year ago.”