H&E Equipment Services (HEES) Reports 14% Revenue Decline

By Tamara Parker • Tuesday, April 29 15:24 • Permanent Link

H&E Equipment Services, Inc. (NASDAQ: HEES), also known as H&E Rentals, has reported its financial results for the first quarter ending on March 31, 2025. The company's revenues declined by 14.0% to $319.5 million compared to $371.4 million in the first quarter of 2024. The net loss was $6.2 million, and adjusted net income was $1.2 million, a significant decrease from the net income of $25.9 million in the same period last year. The adjusted EBITDA also decreased by 18.9% to $131.2 million from $161.7 million.

Specifically, total equipment rental revenues were $274.0 million, a decrease of 7.2% compared to $295.3 million, and rental revenues were $242.9 million, a decrease of 7.2% compared to $261.7 million. Sales of rental equipment decreased by 50.3% to $23.9 million from $48.1 million. The total gross margin declined to 38.7% compared to 44.4%, with rental gross margins at 43.6% compared to 48.5%.

The average time utilization decreased to 60.3% from 63.6%, and the dollar utilization was 33.1% compared to 37.0%. The original equipment cost of the company’s rental fleet as of March 31, 2025, was approximately $2.9 billion, representing an increase of 3.8% compared to the end of the first quarter of 2024.

Selling, general, and administrative ("SG&A") expenses for the first quarter of 2025 were $111.6 million, a decrease of 2.4% compared to $114.3 million in the first quarter of 2024. The loss from operations for the first quarter of 2025 was $5.8 million, including transaction expenses of $9.8 million attributable to the planned merger with Herc Holdings Inc.

Interest expense was $16.0 million for the first quarter of 2025, compared to $18.4 million in the first quarter of 2024. The net loss in the first quarter of 2025 was $6.2 million, which included the previously noted transaction expenses of $9.8 million. Adjusted net income in the first quarter of 2025, excluding the transaction expenses, was $1.2 million, a significant decrease from the net income of $25.9 million in the first quarter of 2024.

H&E is enthusiastic about the planned merger with Herc Rentals and looks forward to the expected mid-year 2025 close of the transaction.

Following these announcements, the company's shares moved -0.7%, and are now trading at a price of $89.75. If you want to know more, read the company's complete 8-K report here.

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