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Stock Market & Financial Investment News

News Breaks
June 6, 2014
15:09 EDTCAR, HTZHertz crashes after more accounting errors found, profit warning issued
Shares of rental company Hertz (HTZ) are crashing after the company warned its first quarter results are "likely to be below consensus" and revealed that mistakes were identified during its preparation of its financial statements and that certain ones must be restated. WHAT'S NEW: Hertz announced that it postponed the filing of its form 10-Q due to errors identified relating to the company's conclusions regarding the capitalization and timing of depreciation for certain non-fleet assets, allowances for doubtful accounts in Brazil, as well as other items. Hertz continued its review and identified additional errors related to allowances for uncollectible amounts with respect to renter obligations for damaged vehicles and restoration obligations at the end of facility leases. The company's audit committee concluded that the financial statements for 2011 should no longer be relied upon and Hertz must restate them. Hertz said in its filing that it also needs to correct the 2012 and 2013 financial statements to reflect these errors and that it may need to restate those as well. Hertz also noted in the filing that for Q1 the company’s results are "likely to be below consensus, reflecting costs associated with the accounting review, other unusual items, and certain anticipated operating results." Consensus for Hertz' Q1 EPS and revenue were 9c and $2.56B, respectively, prior to the filing. Hertz also noted in its filing that Q1 U.S. rental car revenue increased approximately 4.5% over the same period last year and that U.S. rental car total revenue per day was down 1.6% compared with last year. International rental car revenue increased approximately 1.7% over the same period last year and worldwide equipment rental segment revenue increased approximately 2.4% over the same period last year during Q1, Hertz added. WHAT'S NOTABLE: Hertz had previously filed to delay its 10-Q on May 13 and disclosed some of the errors it had found to that point. Hertz stated that its previously disclosed equipment rental business’ transition into a new, publicly traded company is advancing and remains "on track," but added that it is possible that the efforts to resolve the various accounting issues could impact the timing of the actual separation. ANALYST REACTION: Wells Fargo analyst Richard Kwas wrote that Hertz's disclosure will be a headwind for the stock, as he feels the ongoing accounting mistakes are likely to spark further concerns among investors. However, Kwas noted that the errors don't appear to be fleet-related and he feels the forward commentary the company gave as part of its filing to be "good." Wells Fargo has an Outperform rating on the stock. OTHERS TO WATCH: The primary publicly traded competitor to Hertz in the rental car industry is Avis Budget (CAR). PRICE ACTION: During afternoon trading, shares of Hertz fell 8.86% to $27.79, while Avis Budget was up 2.25% to $60.03.
News For HTZ;CAR From The Last 14 Days
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May 21, 2015
08:16 EDTHTZHertz appoints Lawrence Silber to President and CEO of HERC
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May 20, 2015
16:32 EDTHTZHertz appoints Eliana Zem as Chief Human Resources Officer
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May 15, 2015
14:36 EDTCARViking Global reports 4.2% passive stake in Avis Budget
13:37 EDTCAR, HTZAvis spikes after Hertz discloses raising prices ahead of summer travel season
Shares of Avis Budget Group (CAR) and Hertz Global Holdings (HTZ) are rallying after Hertz said it is raising prices in anticipation of a busy summer travel season. WHAT'S NEW: In a press release from last night, Hertz said it is committed to maintaining supply consistent with correlated demand drivers, such as gross domestic product and airline passenger volume. The company said it will moderate its calendar 2015 U.S. fleet plan to reflect a capacity increase of 1.5%-2.5% over 2014 levels. The company has also identified 200 of its U.S. off-airport locations that it will close by the end of the second quarter. WHAT'S NOTABLE: Hertz noted that based on its revised fleet capacity plan and expected strong seasonal demands it is implementing broad-based price increases for its Hertz, Dollar and Thrifty brands at U.S. rental locations for pick ups starting on June 14, and for all dates forward. U.S. airport retail car rentals increased $5 per day and $20 per week. Off-airport retail car rentals increased $3 per day and $10 per week. The company added that weekend rates also reflect price increases of $5 per day for airport rentals and $3 per day for off-airport rentals. PRICE ACTION: In afternoon trading, shares of Hertz are up 4.5% while shares of its rival Avis Budget are up over 8.5%.
10:55 EDTHTZJANA Partners gives quarterly update on stakes
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10:13 EDTCARHigh option volume stocks
High option volume stocks: POST SFM GSVC HGG HUN PH JWN CAR ONTY LBTYA
May 14, 2015
17:32 EDTHTZHertz anticipated filing Form 10-Q before mid-FY15
As previously announced, the previously issued financial statements must be restated and should no longer be relied upon. As a result of the completion of Management's examination of additional accounts in connection with our accounting review and investigation, the company has identified an additional $30M in errors above that which had been previously identified. As a result, the impact on GAAP pre-tax income of cumulative errors identified to date, on an unaudited basis, is approximately $42M, $85M and $56M for 2013, 2012 and 2011, respectively, inclusive of $9M in 2012 and $19M in 2011, previously disclosed and reflected in the financials included in the company's 2013 Form 10-K/A. The review and investigation of the company's financial records are ongoing, and amounts are therefore subject to change. The financial information set forth in this release is subject to change based on the completion of the investigation and review, and such changes may be significant. The company anticipates filing a Form 10-K for 2014 that will contain audited restated financial statements for 2012 and 2013 and audited financial statements for 2014, as well as selected restated financial information for 2011. This 2014 Form 10-K will also contain quarterly information for the quarters in 2014 and we intend to seek waivers from certain of our lenders in connection with using this format. Hertz continues to expect that it will not be able to file this 2014 Form 10-K, as well as its first quarter 2015 Form 10-Q, before mid-2015, and there can be no assurance that the process will be completed at that time, or that no additional adjustments will be identified.
17:30 EDTHTZHertz equipment rental separation won't occur until after accounting review
Hertz remains committed to the separation of its equipment rental business and is continuing to advance those plans, although the actual separation will not occur until after the Company has completed its accounting review, filed its financial statements with the SEC, and has completed the audited carve out financial statements for the equipment rental business and requisite SEC filing activities for the separation.
17:29 EDTHTZHertz sees international fleet capacity up 1%-2%
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17:26 EDTHTZHertz reducing fleet capacity, to close 200 locations
Hertz released Q1 operating results and updated the status of its fleet renewal and capacity plans, $200M annual cost reduction program, senior management hiring initiatives and financial restatement process. During the first quarter, the company made progress in the following areas: The U.S. fleet has been significantly renewed since late September with a 47% improvement in the number of vehicles at or below 30,000 miles. An aggressive disposition program as well as new fleet acquisitions have culminated in improved product quality. Customer confidence is returning as a result of the younger fleet and investments in service delivery. Hertz's U.S. car rental Net Promoter Score, a measure of customer satisfaction, eclipsed last year's level and continues to improve. Hertz has further strengthened its leadership team by adding expertise in the areas of revenue management, sales, customer service, information technology, and fleet and procurement, which will enable the company to deliver on its performance improvement plan. Data management and forecasting systems have been enhanced for more reliable visibility to fleet, pricing and demand trends. The cost structure is improving as the company has made significant progress toward its goal of delivering $200M in annualized cost savings by year end 2015. As part of the company's continued, comprehensive review of the profitability of its operations, it has conducted a location-by-location assessment of its U.S. off-airport retail store profitability. While the company remains committed to its off-airport operation, by the end of Q2, it will have closed approximately 200 stores, representing 5% of the total off-airport locations and less than 1% of the vehicle fleet. Closing these stores will result in approximately $10M in annual savings. The company will continue to rigorously review new store openings and the ongoing profitability of the existing locations on a quarterly basis.
17:22 EDTHTZHertz reports Q1 revenue $2.44B, consensus $2.53B

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