Hertz Global Issues Q3 Business Update; Announces New Fleet Purchasing Strategy

(RTTNews) - Hertz Global Holdings, Inc. (HTZ) reported third-quarter total revenue of $3.12 billion, an increase of 2% from $3.07 billion, last year. Total U.S. car rental revenue was $1.8 billion in the 2014 third quarter, in line with the 2013 third quarter. For the full year 2014, the company expects corporate EBITDA to be in a range of $1.30 billion to $1.45 billion.

The company announced a new fleet purchasing strategy to improve the U.S. rental car business's competitive position. Hertz will purchase roughly 350,000 model year 2015 vehicles in the U.S., approximately 60% more than the model year 2014 vehicles. Approximately 70% of the U.S. operating fleet is expected to be risk vehicles in calendar year 2015 versus approximately 85% in 2014.

The company also announced it is implementing a global cost reduction program that is expected to result in approximately $100 million of run-rate cost savings by year end 2015. The company is implementing cost reduction, primarily through reduced general and administrative expenses, reduced information technology and capital investments, a reduction in external strategic advisor expenses, and a previously announced freeze to its pension plans.

Hertz said it remains committed to the separation of its equipment rental business and is continuing to advance those plans, although the timing of the actual separation will be delayed and will not occur until after the company has completed its accounting review and filed the necessary updated financial statements with the SEC.