H&E Equipment Services, Inc. (NASDAQ: HEES) today announced results for the fourth quarter and year ended December 31, 2013.
FOURTH QUARTER 2013 HIGHLIGHTS:
- Revenues increased 3.8% to $259.6 million versus $250.1 million a year ago.
- Net income was $14.6 million in the fourth quarter compared to $10.7 million a year ago, an increase of $3.9 million, or 36.4% from a year ago.
- EBITDA increased 17.5% to $70.9 million from $60.4 million, yielding a margin of 27.3% compared to 24.1% of revenues a year ago.
- Rental revenues increased 12.0%, or $9.7 million, to $90.4 million due to a larger fleet and improved rates compared to a year ago. Demand remained strong during the fourth quarter.
- Used equipment sales increased 28.9% to $38.0 million from $29.5 million a year ago.
- Gross margin was 31.5% as compared to 29.4% a year ago. Rental gross margin increased to 48.9% compared to 48.1% a year ago and combined parts and services gross margin improved to 42.6% versus 39.2% a year ago.
- Average time utilization (based on original equipment cost) was 71.9% compared to 71.8% a year ago and 72.3% in the third quarter of 2013. Average time utilization (based on units available for rent) was 66.0% compared to 66.6% last year and last quarter.
- Average rental rates increased 5.6% compared to a year ago and improved 0.4% compared to the third quarter of this year.
- Dollar utilization was 36.2% compared to 36.4% a year ago.
- Average rental fleet age at December 31, 2013 was 34.9 months, down from 38.0 months at the end of the last year and approximately ten months younger than the current industry average age of 45 months.
“Our fourth quarter performance demonstrated across the board strength and momentum that has continued in our business,” said John Engquist, H&E Equipment Services’ chief executive officer. “Demand for rental equipment was strong in the fourth quarter, driving higher consolidated margins and strong utilization even while operating a significantly larger fleet. Our combined distribution business remained solid as well, despite a lower level of year-end buying of certain new cranes from a year ago, which we believe was the result of reduced year-end tax incentives. We see our continued focus on leveraging the increasing demand in our end user markets and our operational efficiency reflected in our financial results for the quarter, with income from operations and EBITDA increasing 18.6% and 17.5%, respectively, against the prior year quarter.”