H&E Equipment Services Reports Third 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										Nine Months Ended
			September 30,										September 30,
			2011					2010					2011					2010
Revenues:
Equipment rentals			$	61,190				$	48,272				$	165,440				$	126,400
New equipment sales				46,543					47,697					133,629					103,952
Used equipment sales				27,172					14,700					65,655					46,062
Parts sales				24,647					22,599					71,166					65,013
Service revenues				14,191					12,412					40,072					36,466
Other				10,546					8,164					27,570					21,643
Total revenues				184,289					153,844					503,532					399,536
Cost of revenues:
Rental depreciation				22,076					19,628					64,146					58,260
Rental expense				12,176					10,552					34,484					29,171
New equipment sales				41,123					42,979					118,271					93,992
Used equipment sales				20,824					11,083					50,444					35,690
Parts sales				18,073					16,710					52,174					47,804
Service revenues				5,451					5,177					15,499					13,805
Other				10,825					9,795					31,862					26,630
Total cost of revenues				130,548					115,924					366,880					305,352
Gross profit				53,741					37,920					136,652					94,184
Selling, general, and administrative expenses				39,042					36,594					114,681					109,233
Gain on sales of property and equipment				372					125					521					324
Income from operations				15,071					1,451					22,492					(14,725	)
Interest expense				(7,222	)				(7,287	)				(21,607	)				(21,781	)
Other income, net				118					10					626					166
Income (loss) before provision (benefit) for income taxes				7,967					(5,826	)				1,511					(36,340	)
Provision (benefit) for income taxes				3,119					(2,046	)				447					(13,389	)
Net income (loss)			$	4,848				$	(3,780	)			$	1,064				$	(22,951	)
NET INCOME (LOSS) PER SHARE
Basic – Net income (loss) per share			$	0.14				$	(0.11	)			$	0.03				$	(0.66	)
Basic – Weighted average number of common shares outstanding				34,804					34,700					34,743					34,656
Diluted – Net income (loss) per share			$	0.14				$	(0.11	)			$	0.03				$	(0.66	)
Diluted – Weighted average number of common shares outstanding				34,860					34,700					34,884					34,656

H&E EQUIPMENT SERVICES, INC.
SELECTED BALANCE SHEET DATA (unaudited)
(Amounts in thousands)
												September 30,				December 31,
												2011				2010
Cash												$	4,894			$	29,149
Rental equipment, net													447,425				426,637
Total assets													734,510				734,421
Total debt (1)													266,223				252,754
Total liabilities													478,498				480,171
Stockholders’ equity													256,012				254,250
Total liabilities and stockholders’ equity												$	734,510			$	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									Nine Months Ended
			September 30,									September 30,
			2011				2010					2011				2010
Net income (loss)			$	4,848			$	(3,780	)			$	1,064			$	(22,951	)
Interest expense				7,222				7,287					21,607				21,781
Provision (benefit) for income taxes				3,119				(2,046	)				447				(13,389	)
Depreciation				25,139				22,867					73,456				68,206
Amortization of intangibles				90				140					337				435
EBITDA			$	40,418			$	24,468				$	96,911			$	54,082

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