Hertz(US:HTZ)2025-08-07 12:03PART I. FINANCIAL INFORMATION Condensed Consolidated Financial Statements (Unaudited) Presents unaudited condensed consolidated financial statements for Hertz Global Holdings, including balance sheets, income, cash flows, and detailed notes Financial Statements - Hertz Global Holdings, Inc. Hertz Global Holdings reported decreased Q2 2025 revenue but a narrowed net loss, with assets increasing and equity turning to a deficit Hertz Global Holdings, Inc. - Key Financials (Q2 2025 vs Q2 2024) | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | | :--- | :--- | :--- | | Revenues | $2,185 | $2,353 | | Net Loss | $(294) | $(865) | | Basic and Diluted EPS | $(0.95) | $(2.82) | Hertz Global Holdings, Inc. - Balance Sheet Summary | Metric | June 30, 2025 (in millions) | Dec 31, 2024 (in millions) | | :--- | :--- | :--- | | Total Assets | $23,083 | $21,802 | | Total Liabilities | $23,587 | $21,649 | | Total Stockholders' Equity (Deficit) | $(504) | $153 | - For the six months ended June 30, 2025, net cash provided by operating activities was $597 million, a decrease from $916 million in the prior year period. Net cash used in investing activities improved to $1.56 billion from $2.78 billion26 Notes to Condensed Consolidated Financial Statements Notes detail an $89 million gain from sale-leaseback, improved vehicle disposal gains, total debt increase to $17.6 billion, and a $330 million litigation accrual - In June 2025, the company sold and leased back certain properties, recognizing a pre-tax gain of $89 million. An additional sale-leaseback in July 2025 is expected to generate a pre-tax gain between $35 million and $40 million5657 - The company recorded a net gain on disposal of revenue earning vehicles of $38 million in Q2 2025, a significant improvement from a $182 million loss in Q2 2024. This was a primary driver of improved profitability60 Total Debt Summary | Debt Category | June 30, 2025 (in millions) | Dec 31, 2024 (in millions) | | :--- | :--- | :--- | | Non-Vehicle Debt | $5,434 | $5,104 | | Vehicle Debt | $12,202 | $11,231 | | Total Debt | $17,636 | $16,335 | - The company has accrued approximately $330 million for litigation related to make-whole premiums and post-petition interest on Unsecured Notes following an adverse appellate court ruling. The company is seeking a review by the U.S. Supreme Court154 Segment Information Both operating segments improved profitability year-over-year, with Americas RAC Adjusted EBITDA swinging to $42 million profit and International RAC also turning positive, driven by lower vehicle depreciation Segment Performance (Three Months Ended June 30) | Segment | Revenues 2025 (in millions) | Revenues 2024 (in millions) | Adjusted EBITDA 2025 (in millions) | Adjusted EBITDA 2024 (in millions) | | :--- | :--- | :--- | :--- | :--- | | Americas RAC | $1,738 | $1,928 | $42 | $(403) | | International RAC | $447 | $425 | $42 | $(6) | | Total | $2,185 | $2,353 | $84 | $(409) | Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) MD&A discusses Q2 2025 financial results, highlighting improved profitability despite revenue decline, primarily due to reduced vehicle depreciation, and details liquidity, capital resources, and debt financing Consolidated Results of Operations Q2 2025 consolidated revenues decreased by 7% to $2.19 billion, but net loss narrowed significantly to $179 million, primarily due to a 60% ($620 million) decrease in vehicle depreciation - The decrease in total revenues for Q2 2025 was primarily due to lower pricing and volume, particularly in the Americas RAC segment200 - The key driver of improved profitability was a $620 million decrease in net vehicle depreciation expense in Q2 2025 compared to Q2 2024, resulting from a fleet refresh, stronger residual values, and gains on vehicle sales201 Results of Operations by Segment Americas RAC revenue declined 10% but Adjusted EBITDA improved to $42 million profit, driven by 61% lower depreciation; International RAC revenue grew 5%, with Adjusted EBITDA turning to $42 million profit Americas RAC - Key Metrics (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $1,738 M | $1,928 M | (10)% | | Adjusted EBITDA | $42 M | $(403) M | NM | | Total RPD | $56.08 | $59.73 | (6)% | | Depreciation Per Unit Per Month | $248 | $644 | (61)% | International RAC - Key Metrics (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $447 M | $425 M | 5% | | Adjusted EBITDA | $42 M | $(6) M | NM | | Vehicle Utilization | 81% | 77% | +4 p.p. | | Depreciation Per Unit Per Month | $261 | $384 | (32)% | Liquidity and Capital Resources Corporate liquidity was $1.45 billion as of June 30, 2025, a decrease from year-end 2024, deemed sufficient for the next twelve months, with recent RCF amendments and new vehicle-backed notes - Corporate liquidity stood at $1.45 billion as of June 30, 2025, down from $1.84 billion at December 31, 2024275 - In May 2025, the company amended its First Lien RCF, extending the maturity of $1.7 billion of commitments from June 2026 to March 2028277 - Net capital expenditures for revenue earning vehicles for the first six months of 2025 was $1.65 billion, a 40% decrease from $2.73 billion in the same period of 2024, driven by higher proceeds from vehicle disposals306307 Quantitative and Qualitative Disclosures About Market Risk No material changes to market risk exposures, including interest rates, foreign currency, and fuel prices, have occurred since the 2024 Form 10-K disclosures - There have been no material changes to the company's market risk disclosures since its Annual Report on Form 10-K for the year ended December 31, 2024328 Controls and Procedures CEO and CFO concluded disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective329331 - No material changes in internal control over financial reporting occurred during the three months ended June 30, 2025330332 PART II. OTHER INFORMATION Legal Proceedings Refers to Note 12 of the Condensed Consolidated Financial Statements for detailed information on pending legal proceedings - For a description of pending legal proceedings, the report refers to Note 12, "Contingencies and Off-Balance Sheet Commitments," in Part I, Item 1334 Risk Factors No material changes to risk factors have occurred since those disclosed in the company's 2024 Annual Report on Form 10-K - There have been no material changes to the risk factors disclosed in the company's 2024 Form 10-K335 Other Items (Items 2, 3, 5, 6) Covers standard disclosures, reporting no unregistered equity sales, no defaults on senior securities, no Rule 10b5-1 trading plans by directors/officers, and refers to the Exhibit Index - The company reported no unregistered sales of equity securities or use of proceeds for the period336 - No defaults upon senior securities were reported337 - No director or officer entered into a Rule 10b5-1 trading arrangement during the quarter ended June 30, 2025338