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H&E Equipment Services Reports Second Quarter 2011 Results

Forward-Looking Statements

Certain statements in this press release are “forward-looking statements” within the meaning of the federal securities laws. Statements about our beliefs and expectations and statements containing the words “may,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project,” “intend” and similar expressions constitute forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties, which could cause actual results that differ materially from those contained in any forward-looking statement. Such factors include, but are not limited to, the following: (1) general economic conditions and construction activity in the markets where we operate in North America as well as the impact of the recent macroeconomic downturn and current conditions of the global credit markets and its effect on construction activity and the economy in general; (2) relationships with new equipment suppliers; (3) increased maintenance and repair costs as we age our fleet and decreases in our equipments’ residual value; (4) our indebtedness; (5) the risks associated with the expansion of our business; (6) our possible inability to integrate any businesses we acquire; (7) competitive pressures; (8) compliance with laws and regulations, including those relating to environmental matters; and (9) other factors discussed in our public filings, including the risk factors included in the Company's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Investors, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we are under no obligation to publicly update or revise any forward-looking statements after the date of this release.

 

H&E EQUIPMENT SERVICES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(Amounts in thousands, except per share amounts)

 
   

Three Months Ended

   

Six Months Ended

June 30,

June 30,

2011

   

2010

2011

   

2010

 
Revenues:
Equipment rentals $ 55,772 $ 41,675 $ 104,250 $ 78,128
New equipment sales 57,913 28,962 87,086 56,255
Used equipment sales 23,066 17,931 38,483 31,362
Parts sales 24,942 22,782 46,519 42,414
Service revenues 13,244 12,571 25,881 24,054
Other   9,398     7,085     17,024     13,479  
 
Total revenues 184,335 131,006 319,243 245,692
 
Cost of revenues:
Rental depreciation 21,507 19,353 42,070 38,632
Rental expense 11,569 9,372 22,308 18,619
New equipment sales 51,118 26,103 77,148 51,013
Used equipment sales 18,058 13,862 29,620 24,607
Parts sales 18,261 16,847 34,101 31,094
Service revenues 5,137 4,252 10,048 8,628
Other   10,890     8,838     21,037     16,835  
 
Total cost of revenues   136,540     98,627     236,332     189,428  
 
Gross profit 47,795 32,379 82,911 56,264
 
Selling, general, and administrative expenses 37,546 36,765 75,639 72,639
Gain on sales of property and equipment   52     135     149     199  
 
Income (loss) from operations 10,301 (4,251 ) 7,421 (16,176 )
 
Interest expense (7,178 ) (7,203 ) (14,385 ) (14,494 )
Other income, net   185     106     508     156  
Income (loss) before provision (benefit) for income taxes 3,308 (11,348 ) (6,456 ) (30,514 )
 
Provision (benefit) for income taxes   619     (4,255 )   (2,672 )   (11,343 )
 
Net income (loss) $ 2,689   $ (7,093 ) $ (3,784 ) $ (19,171 )
 
NET INCOME (LOSS) PER SHARE
Basic – Net income (loss) per share $ 0.08   $ (0.20 ) $ (0.11 ) $ (0.55 )
Basic – Weighted average number of common shares outstanding   34,725     34,642     34,713     34,634  
 
Diluted – Net income (loss) per share $ 0.08   $ (0.20 ) $ (0.11 ) $ (0.55 )
Diluted – Weighted average number of common shares outstanding   34,906     34,642     34,713     34,634  
 

H&E EQUIPMENT SERVICES, INC.

SELECTED BALANCE SHEET DATA (unaudited)

(Amounts in thousands)

 
   

June 30,

   

December 31,

2011

2010

 
Cash $ 5,686 $ 29,149
Rental equipment, net 445,502 426,637
Total assets 731,384 734,421
 

Total debt (1)

267,905 252,754
Total liabilities 480,719 480,171
Stockholders’ equity 250,665 254,250
Total liabilities and stockholders’ equity $ 731,384 $ 734,421
 

(1) Total debt consists of the aggregate amounts outstanding on the senior secured credit facility, senior unsecured notes and capital lease obligations.

 
 

H&E EQUIPMENT SERVICES, INC.

UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(Amounts in thousands)

 
   

Three Months Ended

Six Months Ended

June 30,

June 30,

2011

   

2010

2011

2010

 
Net income (loss) $ 2,689 $ (7,093 ) $ (3,784 ) $ (19,171 )
Interest expense 7,178 7,203 14,385 14,494
Provision (benefit) for income taxes 619 (4,255 ) (2,672 ) (11,343 )
Depreciation 24,622 22,628 48,317 45,339
Amortization of intangibles   123   147     247     295  
 
EBITDA $ 35,231 $ 18,630 $ 56,493 $ 29,614




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