Hertz revenue picked up slightly year over year in the
fourth quarter amid rising volume, but executives said the company has another
year of "heavy lifting" before the car rental supplier becomes
competitive in earnings terms.
Hertz's U.S. car rental revenue rose 1 percent year over
year in the fourth quarter to $1.44 billion as transaction days increased 3
percent and pricing declined 1 percent. Outside the U.S., revenue increased 10
percent to $487 million, as transaction days rose 1 percent and pricing jumped 3
percent.
President and CEO Kathryn Marinello said Hertz's share of
corporate car rental business is "stabilizing," particularly as the
company expands its Ultimate Choice offering, which allows customers to select
their own vehicles. It's now at more than 50 locations, she said. "Our
sales force is finding corporate customers appreciate the efforts they have
made on their behalf. We are renting to more customers as we retain those most
loyal to our brand, regain lost renters and convert the casual renter into a
committed customer."
For the quarter, Hertz reported a net income of $616
million, compared with a $440 million loss in the fourth quarter of 2016. The
fourth-quarter-2017 gain owed to a $795 million benefit related to the recent
U.S. tax reform minus a continuing operations loss of $179 million.
Hertz last year underwent an
upgrade of its U.S. fleet, which caused a depreciation hit. The company
continues to face high expenses this year as it upgrades technology, including
its reservations, digital and customer management platforms, Marinello said.
Those will continue to weigh on earnings throughout this year, and the company
will be in a stronger position of profitability in 2019, she said.
For
the full year, Hertz reported a net income of $327 million compared with a $491
million loss in 2016.
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