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News Releases

Media Contact

News Releases

Hertz Sets Financial Records for Fourth Quarter and Full Year 2011

PR Newswire
PARK RIDGE, N.J.
Feb 22, 2012

PARK RIDGE, N.J., Feb. 22, 2012 /PRNewswire/ --

  • Worldwide revenues for the quarter up 9.7% year-over-year (“YOY”).
  • Fourth quarter worldwide car rental revenues of $1,695.2 million, on record transaction days; worldwide equipment rental revenues increased 11.1% YOY; U.S. HERC fourth quarter rental rate revenue increased 15.5% YOY.
  • Record fourth quarter adjusted pre-tax margin of 8.2%, and record adjusted pre-tax income(1) of $165.1 million, 136.5% higher YOY. GAAP pre-tax income for the fourth quarter of $92.8 million, up $98.8 million YOY.
  • U.S. car rental adjusted pre-tax income for the fourth quarter up 45.2% YOY, on a margin improvement of 440 bps; worldwide equipment rental adjusted pre-tax income up 77.4% for the quarter, on a margin improvement of 730 bps.
  • Adjusted diluted earnings per share(1) for the quarter of $0.24 versus $0.10 in the fourth quarter of 2010.  GAAP diluted earnings per share for the quarter of $0.11 versus a loss of $0.07 in the fourth quarter of 2010.
  • Record full year worldwide RAC revenues of $7.1 billion in 2011, on record transaction days; four consecutive quarters of double-digit worldwide equipment rental revenue growth in 2011.
  • Record adjusted pre-tax income for FY 2011 of $680.5 million, up 96.1% YOY, on a margin improvement of 360 bps.  GAAP pre-tax income for FY 2011 of $324.3 million versus a loss of $14.6 million in 2010.

Hertz Global Holdings, Inc. (NYSE: HTZ) (with its subsidiaries, the "Company" or "we") reported fourth quarter 2011 worldwide revenues of $2.0 billion, an increase of 9.7% year-over-year (a 9.8% increase excluding the effects of foreign currency).  Worldwide car rental revenues for the quarter increased 9.5% year-over-year (a 9.6% increase excluding the effects of foreign currency) to $1,695.2 million.  Revenues from worldwide equipment rental for the fourth quarter were $317.9 million, up 11.1% year-over-year (a 11.4% increase excluding the effects of foreign currency).    

(Logo: http://photos.prnewswire.com/prnh/20110810/NY50373LOGO )

Fourth quarter 2011 adjusted pre-tax income was $165.1 million, versus $69.8 million in the same period in 2010, and income before income taxes (“pre-tax income”), on a GAAP basis, was $92.8 million, versus a loss of $6.0 million in the fourth quarter of 2010.  Corporate EBITDA(1) for the fourth quarter of 2011 was $335.2 million, an increase of 25.3% from the same period in 2010.  

Fourth quarter 2011 adjusted net income(1) was $104.0 million, versus $41.6 million in the same period of 2010, resulting in adjusted diluted earnings per share for the quarter of $0.24, compared with $0.10 for the fourth quarter of 2010.  Fourth quarter 2011 net income attributable to Hertz Global Holdings, Inc. and Subsidiaries’ common stockholders, or “net income,” on a GAAP basis, was $47.1 million or $0.11 per share on a diluted basis, compared with a loss of $28.1 million, or $0.07 per share on a diluted basis, for the fourth quarter of 2010.

Mark P. Frissora, the Company's Chairman and Chief Executive Officer, said, “Our record results for the fourth quarter and full year 2011 are attributable to an equal emphasis on efficiency and revenue growth, which were achieved despite deteriorating macro conditions in Europe.  Hertz generated over $450 million of efficiency savings last year, bringing the cumulative five-year total to over $2.1 billion, representing 25% of our total cost base. The results of our growth initiatives were record worldwide car rental revenues for full year 2011, on record transaction day growth, and the fourth consecutive quarter of double-digit growth in the equipment rental business.  These achievements capped a year where Hertz almost doubled 2010 adjusted pre-tax income and beat the previous, pre-recession record in 2007, on $387.2 million lower revenues. We also refinanced almost $7 billion of debt on favorable terms last year, further strengthening our balance sheet.  A continued emphasis on technology-driven efficiencies and customer service initiatives, the advancement of an asset-light business model, and a rich mixture of car and equipment rental growth initiatives, are the recipe for sustained financial improvement in 2012 and beyond.”

INCOME MEASUREMENTS, FOURTH QUARTER 2011 & 2010



Q4 2011


Q4 2010


(in millions, except per share amounts)


Pre-tax

Income


 Net

Income


Diluted

Earnings

Per Share


Pre-tax

Income (Loss)



 Net

Income (Loss)


Diluted Earnings (Loss)

Per Share


Earnings Measures, as reported  (EPS   based on 437.2M and 413.0M diluted shares, respectively)


$

92.8


$

47.1


$

0.11


$

(6.0)


$

(28.1)


$

(0.07)


Adjustments:





















Purchase accounting                                                                                



25.5









22.0









Non-cash debt charges



22.4









37.8









Restructuring and related charges



19.3









14.4









Acquisition related costs



5.2









0.9









Derivative (gains) losses



(0.1)









0.7








Adjusted pre-tax income



165.1



165.1






69.8



69.8





Assumed provision for income taxes at 34%






(56.1)









(23.7)





Noncontrolling interest






(5.0)









(4.5)





Earnings Measures, as adjusted (EPS based on 437.2M and 410.0M diluted shares, respectively)


$

165.1


$

104.0


$

0.24


$

69.8


$

41.6


$

0.10
























The Company ended the fourth quarter of 2011 with total debt of $11.3 billion and net corporate debt(1) of $3.68 billion, compared with total debt of $12.5 billion and net corporate debt of $4.44 billion as of September 30, 2011. Total debt decreased in the fourth quarter of 2011 primarily due to a decrease in fleet debt and our Senior ABL Facility related to seasonality.  Net cash provided by operating activities was $584.8 million in the fourth quarter of 2011, compared to $479.1 million in the same period last year, an increase of $105.7 million.  The increase was primarily due to an increase in net income before depreciation, amortization and other non-cash expenses.

WORLDWIDE CAR RENTAL

Worldwide car rental revenues were $1,695.2 million for the fourth quarter of 2011, an increase of 9.5% (a 9.6% increase excluding the effects of foreign currency) from the prior year period. The Company achieved record transaction days for the quarter which increased 7.2% over the fourth quarter of 2010 [8.6% U.S.; 4.1% International]. U.S. off-airport total revenues for the fourth quarter increased 10.1% year-over-year, and transaction days increased 15.0% from the prior year period. Worldwide rental rate revenue per transaction day(1) (“RPD”) for the quarter decreased 4.2% [(5.2)% U.S.; (1.9)% International] from the prior year period.  RPD continues to be impacted by the shift in our mix between airport and off-airport rentals.  When adjusted for mix, fourth quarter U.S. RPD decreased 3.1%, with the leisure business decreasing 2.7%.  Growth in off-airport rentals, and specifically growth in replacement rentals, which have longer rental lengths, has a negative impact on RPD.  However, it is important to note that off-airport’s highly contributory profit is growing significantly.

Worldwide car rental adjusted pre-tax income for the fourth quarter of 2011 was $171.4 million, an increase of $39.3 million from $132.1 million in the prior year period.  The result was driven by increased volume, strong residual values, strong cost management performance, and gains in the disposition of properties, partially offset by negative RPD. As a result, worldwide car rental achieved an adjusted pre-tax margin of 10.1% for the quarter, versus 8.5% in the prior year period.

The worldwide average number of Company-operated cars, largely as a result of the Donlen acquisition, for the fourth quarter of 2011 was 599,300, an increase of 40.2% over the prior year period, and a 7.9% year-over-year excluding the Donlen fleet.  

WORLDWIDE EQUIPMENT RENTAL

Worldwide equipment rental revenues were $317.9 million for the fourth quarter of 2011, a 11.1% increase (a 11.4% increase excluding the effects of foreign currency) from the prior year period.

Adjusted pre-tax income for worldwide equipment rental for the fourth quarter of 2011 was $62.1 million, an improvement of $27.1 million from $35.0 million in the prior year period, primarily attributable to the effects of increased volume and pricing and cost management initiatives.  Worldwide equipment rental achieved an adjusted pre-tax margin of 19.5%, and a Corporate EBITDA margin of 44.3% for the quarter.

The average acquisition cost of rental equipment operated during the fourth quarter of 2011 increased by 3.8% year-over-year and net revenue earning equipment as of December 31, 2011 was $1,786.7 million, compared to $1,779.1 million as of September 30, 2011.

FULL YEAR RESULTS

Worldwide revenues for the full year 2011 were $8.3 billion, an increase of 9.7% over the prior year (a 7.4% increase excluding the effects of foreign currency).  Worldwide car rental revenues for the year increased 9.2% (a 6.8% increase excluding the effects of foreign currency) to $7.1 billion.  Revenues from worldwide equipment rental for the year increased 13.0% (a 11.4% increase excluding the effects of foreign currency) to $1,209.5 million.    

Adjusted pre-tax income for the year was $680.5 million, almost double the prior year amount of $347.1 million and pre-tax income, on a GAAP basis, was $324.3 million, versus a pre-tax loss of $14.6 million in 2010.  Corporate EBITDA for the year was $1,389.5 million, an increase of 26.3% from 2010.  

Full year 2011 adjusted net income was $429.6 million, an increase of 102.9% from 2010, resulting in adjusted diluted earnings per share for the year of $0.97, compared to $0.52 in the prior year.  Full year 2011 net income, on a GAAP basis, was $176.2 million or $0.40 per share on a diluted basis, compared with a net loss of $48.7 million, or $0.12 per share on a diluted basis, for 2010.

INCOME MEASUREMENTS, FULL YEAR 2011 & 2010



Full Year 2011


Full Year 2010


(in millions, except per share amounts)


Pre-tax

Income


 Net

Income


Diluted

Earnings

Per Share


Pre-tax

Income

(Loss)



 Net

Income (Loss)


Diluted

Earnings (Loss)

Per Share


Earnings Measures, as reported  (EPS   based on 444.8M and 411.9M diluted shares, respectively)


$

324.3


$

176.2


$

0.40


$

(14.6)


$

(48.7)


$

(0.12)


Adjustments:





















Purchase accounting                                                                                



87.6









90.3









Non-cash debt charges



130.4









182.6









Restructuring and related charges



66.2









67.9









Premiums paid on debt



62.4









-









Acquisition related costs



18.8









17.7









Derivative (gains) losses



(0.1)









3.2









Pension adjustment



(13.1)









-









Management transition costs



4.0









-








Adjusted pre-tax income



680.5



680.5






347.1



347.1





Assumed provision for income taxes at 34%






(231.3)









(118.0)





Noncontrolling interest






(19.6)









(17.4)





Earnings Measures, as adjusted (EPS based on 444.8M and 410.0M diluted shares, respectively)


$

680.5


$

429.6


$

0.97


$

347.1


$

211.7


$

0.52
























The Company ended 2011 with total debt of $11.3 billion and net corporate debt of $3.68 billion, compared with total debt of $11.3 billion and net corporate debt of $3.36 billion as of December 31, 2010.  Net corporate debt increased primarily due a decrease in cash and cash equivalents. Net cash provided by operating activities was $2,233.3 million for the year, compared to $2,208.7 million in 2010.

OUTLOOK    

For the full year 2012, the Company forecasts the following:





Revenues



$8,850M - $8,950M

Corporate EBITDA(2)



$1,520M - $1,590M

Adjusted Pre-Tax Income(2)



$790M - $860M

Adjusted Net Income(2)



$520M - $570M

Adjusted Diluted Earnings Per Share(2)



$1.16-$1.26



The Company forecasts full year 2012 revenues in the range of $8,850.0 million to $8,950.0 million.  The range is based on the projection of modest economic growth, a strong U.S. Dollar and incremental franchising of certain rental operations.  The adjusted diluted number of shares outstanding is estimated to fluctuate within a range of 418 million to 456 million through the year. The estimate for Q1 is 418 million shares outstanding.  For example, based on 450 million adjusted diluted shares outstanding, the Company’s full year 2012 guidance for adjusted diluted earnings per share is $1.26 at the upper end of the guidance range.  The Company will provide an estimate of forecasted adjusted diluted shares outstanding on a quarterly basis.

Mark Frissora, commenting on the Company’s outlook, said, “Despite the soft conditions in Europe, we are encouraged by the operating environment in the United States. For the first quarter of this year, we are anticipating double-digit volume growth in the U.S. car rental business, based on solid advance reservation build-up, and we are expecting approximately 20% rental rate revenue growth in the U.S. equipment rental business.”

RESULTS OF THE HERTZ CORPORATION

The Company's operating subsidiary, The Hertz Corporation ("Hertz"), posted the same revenues for the fourth quarter of 2011 as the Company.  Hertz’s fourth quarter 2011 pre-tax income was $105.4 million versus the Company’s pre-tax income of $92.8 million and Hertz’s full year 2011 pre-tax income was $373.9 million versus the Company’s pre-tax income of $324.3 million.  The difference between Hertz’s and the Company’s results is primarily due to additional interest expense recognized by the Company on its 5.25% Convertible Senior Notes issued in May and September 2009.

(1) Adjusted pre-tax income, adjusted pre-tax margin, Corporate EBITDA, adjusted net income, adjusted diluted earnings per share, net corporate debt and rental rate revenue per transaction day are non-GAAP measures.  See the accompanying Tables and Exhibit for the reconciliations and definitions for each of these non-GAAP measures and the reason the Company’s management believes that these measures provide useful information to investors regarding the Company’s financial condition and results of operations.

(2) Management believes that Corporate EBITDA, adjusted pre-tax income, adjusted net income and adjusted diluted earnings per share are useful in measuring the comparable results of the Company period-over-period.  The GAAP measures most directly comparable to Corporate EBITDA, adjusted pre-tax income, adjusted net income and adjusted diluted earnings per share are (i) pre-tax income and cash flows from operating activities, (ii) pre-tax income, (iii) net income, and (iv) diluted earnings per share, respectively.  Because of the forward-looking nature of the Company’s forecasted Corporate EBITDA, adjusted pre-tax income, adjusted net income and adjusted diluted earnings per share, specific quantifications of the amounts that would be required to reconcile forecasted cash flows from operating activities, pre-tax income and net income are not available.  The Company believes that there is a degree of volatility with respect to certain of the Company’s GAAP measures, primarily related to fair value accounting for its financial assets (which includes the Company’s derivative financial instruments), its income tax reporting and certain adjustments made to arrive at the relevant non-GAAP measures, which preclude the Company from providing accurate forecasted GAAP to non-GAAP reconciliations.   Based on the above, the Company believes that providing estimates of the amounts that would be required to reconcile the range of the non-GAAP Corporate EBITDA, adjusted pre-tax income, adjusted net income and adjusted diluted earnings per share to forecasted cash flows from operating activities, pre-tax income, net income and diluted earnings per share would imply a degree of precision that would be confusing or misleading to investors for the reasons indentified above.

CONFERENCE CALL INFORMATION

The Company’s fourth quarter 2011 earnings conference call will be held on Thursday, February 23, 2012, at 10:00 a.m. (EST). To access the conference call live, dial 800-288-8968 in the U.S. and 612-332-0335 for international callers using the passcode: 236861 or listen via webcast at www.hertz.com/investorrelations. The conference call will be available for replay one hour following the conclusion of the call until March 8, 2012 by calling 800-475-6701 in the U.S. or 320-365-3844 for international callers with the passcode: 236861. The press release and related tables containing the reconciliations of non-GAAP measures will be available on our website, www.hertz.com/investorrelations.

ABOUT THE COMPANY

Hertz is the largest worldwide airport general use car rental brand, operating from approximately 8,500 corporate and licensee locations in approximately 150 countries in North America, Europe, Latin America, Asia, Australia, Africa, the Middle East and New Zealand. Hertz is the number one airport car rental brand in the U.S. and at 119 major airports in Europe.  In addition, the Company, has sales and marketing centers in 60 countries which promote Hertz business both within and outside such country. Product and service initiatives such as Hertz Gold Choice, Hertz #1 Club Gold®, NeverLost® customized, onboard navigation systems, Sirius XM Satellite Radio, and unique cars and SUVs offered through the Company's Adrenaline Prestige and Green Traveler Collections, set Hertz apart from the competition. In 2008, the Company entered the global car sharing market with its service now referred to as Hertz On Demand which rents cars by the hour and/or by the day, at various locations in the U.S., Canada and Europe.  Hertz also operates one of the world's largest equipment rental businesses, Hertz Equipment Rental Corporation, offering a diverse line of rental equipment, from small tools and supplies to earthmoving equipment, as well as new and used equipment for sale, to customers ranging from major industrial companies to local contractors and consumers, from approximately 315 branches in the United States, Canada, China, France, Spain, Italy and Saudi Arabia, as well as through its international licensees.  Hertz also owns Donlen Corporation, based in Northbrook, Illinois, which is a leader in providing fleet leasing and management services.

CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release and in related comments by our management include "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements include information concerning the Company's outlook, anticipated revenues and results of operations, as well as any other statement that does not directly relate to any historical or current fact. These forward-looking statements often include words such as "believe," "expect," "project," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts" or similar expressions. These statements are based on certain assumptions that the Company has made in light of its experience in the industry as well as its perceptions of historical trends, current conditions, expected future developments and other factors that the Company believes are appropriate in these circumstances. We believe these judgments are reasonable, but you should understand that these statements are not guarantees of performance or results, and our actual results could differ materially from those expressed in the forward-looking statements due to a variety of important factors, both positive and negative.

Among other items, such factors could include: our ability to obtain regulatory approval for and to  consummate an acquisition of Dollar Thrifty Automotive Group; the risk that expected synergies, operational efficiencies and cost savings from the Dollar Thrifty acquisition may not be fully realized or realized within the expected time frame; the operational and profitability impact of divestitures that may be required to be undertaken to secure regulatory approval for an acquisition of Dollar Thrifty; levels of travel demand, particularly with respect to airline passenger traffic in the United States and in global markets; significant changes in the competitive environment, including as a result of industry consolidation, and the effect of competition in our markets, including on our pricing policies or use of incentives; occurrences that disrupt rental activity during our peak periods; our ability to achieve cost savings and efficiencies and realize opportunities to increase productivity and profitability; an increase in our fleet costs as a result of an increase in the cost of new vehicles and/or a decrease in the price at which we dispose of used vehicles either in the used vehicle market or under repurchase or guaranteed depreciation programs; our ability to accurately estimate future levels of rental activity and adjust the size of our fleet accordingly; our ability to maintain sufficient liquidity and the availability to us of additional or continued sources of financing for our revenue earning equipment and to refinance our existing indebtedness; safety recalls by the manufacturers of our vehicles and equipment; a major disruption in our communication or centralized information networks; financial instability of the manufacturers of our vehicles and equipment; any impact on us from the actions of our licensees, franchisees, dealers and independent contractors; our ability to maintain profitability during adverse economic cycles and unfavorable external events (including war, terrorist acts, natural disasters and epidemic disease); shortages of fuel and increases or volatility in fuel costs; our ability to successfully integrate acquisitions and complete dispositions; our ability to maintain favorable brand recognition; costs and risks associated with litigation; risks related to our indebtedness, including our substantial amount of debt and our ability to incur substantially more debt and increases in interest rates or in our borrowing margins; our ability to meet the financial and other covenants contained in our senior credit facilities, our outstanding unsecured senior notes and certain asset-backed and asset-based funding arrangements; changes in accounting principles, or their application or interpretation, and our ability to make accurate estimates and the assumptions underlying the estimates, which could have an effect on earnings; changes in the existing, or the adoption of new laws, regulations, policies or other activities of governments, agencies and similar organizations where such actions may affect our operations, the cost thereof or applicable tax rates; changes to our senior management team; the effect of tangible and intangible asset impairment charges; the impact of our derivative instruments, which can be affected by fluctuations in interest rates and commodity prices; and our exposure to fluctuations in foreign exchange rates.  Additional information concerning these and other factors can be found in our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

The Company therefore cautions you against relying on these forward-looking statements. All forward-looking statements attributable to the Company or persons acting on the Company’s behalf are expressly qualified in their entirety by the foregoing cautionary statements. All such statements speak only as of the date made, and the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Tables and Exhibit:

Table 1: Condensed Consolidated Statements of Operations for the Three Months and Year Ended December 31, 2011 and 2010

Table 2: Condensed Consolidated Statements of Operations As Reported and As Adjusted for the Three Months and Year Ended December 31, 2011 and 2010

Table 3: Segment and Other Information for the Three Months and Year Ended December 31, 2011 and 2010

Table 4: Selected Operating and Financial Data as of or for the Three Months and Year Ended December 31, 2011 compared to December 31, 2010 and Selected Balance Sheet Data as of December 31, 2011 and December 31, 2010

Table 5: Non-GAAP Reconciliations of Adjusted Pre-Tax Income (Loss), Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) per Share for the Three Months and Year Ended December 31, 2011 and 2010

Table 6: Non-GAAP Reconciliations of EBITDA, Corporate EBITDA, Unlevered Pre-Tax Cash Flow, Levered After-Tax Cash Flow Before Fleet Growth and Corporate Cash Flow for the Three Months and Year Ended December 31, 2011 and 2010

Table 7: Non-GAAP Reconciliations of Operating Cash Flows to EBITDA for Three Months and Year Ended December 31, 2011 and 2010, Net Corporate Debt, Net Fleet Debt and Total Net Debt as of December 31, 2011, 2010 and 2009 and September 30, 2011 and 2010, Car Rental Rate Revenue per Transaction Day and Equipment Rental and Rental Related Revenue for the Three Months and Year Ended December 31, 2011 and 2010

Exhibit 1: Non-GAAP Measures: Definitions and Use/Importance








Table 1

HERTZ GLOBAL HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts)

Unaudited



Three Months Ended


As a Percentage


December 31,


of Total Revenues


2011


2010*


2011


2010

Total revenues

$ 2,013.8


$ 1,835.8


100.0%


100.0%









Expenses:








Direct operating (a)

1,057.8


1,035.0


52.5%


56.4%

Depreciation of revenue earning








equipment and lease charges

526.7


451.2


26.2%


24.5%

Selling, general and administrative    

169.9


156.1


8.4%


8.5%

Interest expense

167.7


201.3


8.3%


11.0%

Interest income

(0.9)


(1.8)


-%


(0.1)%

Other (income) expense,  net

(0.2)


-


-%


-%

Total expenses

1,921.0


1,841.8


95.4%


100.3%

Income (loss) before income taxes

92.8


(6.0)


4.6%


(0.3)%

Provision for taxes on income

(40.7)


(17.6)


(2.0)%


(1.0)%

Net income (loss)

52.1


(23.6)


2.6%


(1.3)%

Less: Net income attributable to noncontrolling interest

(5.0)


(4.5)


(0.3)%


(0.2)%

Net income (loss) attributable to Hertz Global Holdings,








Inc. and Subsidiaries' common stockholders

$      47.1


$    (28.1)


2.3%


(1.5)%









Weighted average number of  








shares outstanding:








    Basic

416.9


413.0





    Diluted

437.2


413.0













Earnings (loss) per share attributable to Hertz Global








Holdings, Inc. and Subsidiaries' common stockholders:








    Basic

$      0.11


$    (0.07)





    Diluted

$      0.11


$    (0.07)






















Year Ended


As a Percentage


December 31,


of Total Revenues


2011


2010*


2011


2010

Total revenues

$ 8,298.4


$ 7,562.5


100.0%


100.0%









Expenses:








Direct operating (a)

4,566.4


4,283.4


55.0%


56.7%

Depreciation of revenue earning








equipment and lease charges

1,905.7


1,868.1


23.0%


24.7%

Selling, general and administrative

745.3


664.5


9.0%


8.8%

Interest expense

699.7


773.4


8.4%


10.2%

Interest income

(5.5)


(12.3)


(0.1)%


(0.2)%

Other (income) expense,  net

62.5


-


0.8%


-%

Total expenses

7,974.1


7,577.1


96.1%


100.2%

Income (loss) before income taxes

324.3


(14.6)


3.9%


(0.2)%

Provision for taxes on income

(128.5)


(16.7)


(1.6)%


(0.2)%

Net income (loss)  

195.8


(31.3)


2.3%


(0.4)%

Less: Net income attributable to noncontrolling interest

(19.6)


(17.4)


(0.2)%


(0.2)%

Net income (loss) attributable to Hertz Global Holdings,








Inc. and Subsidiaries' common stockholders

$    176.2


$    (48.7)


2.1%


(0.6)%









Weighted average number of  








shares outstanding:








    Basic

415.9


411.9





    Diluted

444.8


411.9













Earnings (loss) per share attributable to Hertz Global








Holdings, Inc. and Subsidiaries' common stockholders:








    Basic

$      0.42


$    (0.12)





    Diluted

$      0.40


$    (0.12)





















* During the third quarter of 2011, we indentified certain adjustments that should have been recorded in our

previously prepared consolidated financial statements. Direct operating expenses increased (decreased)  

for the three months and year ended December 31, 2010, by $(1.8) million and $1.0 million, respectively,

($(1.1) million and $0.6 million, net of tax, respectively).


(a)  For the three months ended December 31, 2011 and 2010, direct operating includes $38.1 million

and $3.0 million, respectively, of gains from the dispositions of property and equipment.  For the

years ended December 31, 2011 and 2010, direct operating includes $43.1 million and $5.7 million,

respectively, of gains from the dispositions of property and equipment.













Table 2

HERTZ GLOBAL HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions)

Unaudited
















Three Months Ended December 31, 2011


Three Months Ended December 31, 2010


As




As


As




As



Reported


Adjustments


Adjusted


Reported


Adjustments


Adjusted

Total revenues


$ 2,013.8


$                   -


$ 2,013.8


$ 1,835.8


$                   -


$ 1,835.8














Expenses:













Direct operating


1,057.8


(35.3)

(a)

1,022.5


1,035.0


(27.8)

(a)

1,007.2

Depreciation of revenue earning













equipment and lease charges


526.7


(4.2)

(b)

522.5


451.2


(3.7)

(b)

447.5

Selling, general and administrative


169.9


(10.4)

(c)

159.5


156.1


(6.5)

(c)

149.6

Interest expense


167.7


(22.4)

(d)

145.3


201.3


(37.8)

(d)

163.5

Interest income


(0.9)


-


(0.9)


(1.8)


-


(1.8)

Other (income) expense,  net


(0.2)


-


(0.2)


-


-


-

Total expenses


1,921.0


(72.3)


1,848.7


1,841.8


(75.8)


1,766.0

Income (loss) before income taxes


92.8


72.3


165.1


(6.0)


75.8


69.8

Provision for taxes on income


(40.7)


(15.4)

(e)

(56.1)


(17.6)


(6.1)

(e)

(23.7)

Net income (loss)


52.1


56.9


109.0


(23.6)


69.7


46.1

Less: Net income attributable to noncontrolling interest      


(5.0)


-


(5.0)


(4.5)


-


(4.5)

Net income (loss) attributable to Hertz Global Holdings,













Inc. and Subsidiaries' common stockholders      


$      47.1


$             56.9


$    104.0


$     (28.1)


$             69.7


$      41.6
















Year Ended December 31, 2011


Year Ended December 31, 2010


As




As


As




As



Reported


Adjustments


Adjusted


Reported


Adjustments


Adjusted

Total revenues


$ 8,298.4


$                   -


$ 8,298.4


$ 7,562.5


$                   -


$ 7,562.5














Expenses:













Direct operating


4,566.4


(122.1)

(a)

4,444.3


4,283.4


(128.6)

(a)

4,154.8

Depreciation of revenue earning













equipment and lease charges


1,905.7


(10.7)

(b)

1,895.0


1,868.1


(14.3)

(b)

1,853.8

Selling, general and administrative


745.3


(30.6)

(c)

714.7


664.5


(36.2)

(c)

628.3

Interest expense


699.7


(130.4)

(d)

569.3


773.4


(182.6)

(d)

590.8

Interest income


(5.5)


-


(5.5)


(12.3)


-


(12.3)

Other (income) expense,  net


62.5


(62.4)

(f)

0.1


-


-


-

Total expenses


7,974.1


(356.2)


7,617.9


7,577.1


(361.7)


7,215.4

Income (loss) before income taxes


324.3


356.2


680.5


(14.6)


361.7


347.1

Provision for taxes on income


(128.5)


(102.8)

(e)

(231.3)


(16.7)


(101.3)

(e)

(118.0)

Net income (loss)  


195.8


253.4


449.2


(31.3)


260.4


229.1

Less: Net income attributable to noncontrolling interest    


(19.6)


-


(19.6)


(17.4)


-


(17.4)

Net income (loss) attributable to Hertz Global Holdings,    













Inc. and Subsidiaries' common stockholders    


$    176.2


$           253.4


$    429.6


$     (48.7)


$           260.4


$    211.7



























(a)  Represents the increase in amortization of other intangible assets, depreciation of property and equipment and accretion of certain revalued

liabilities relating to purchase accounting.  For the three months ended December 31, 2011 and 2010, also includes restructuring and restructuring

related charges of $14.4 million and $9.5 million, respectively.   For the years ended December 31, 2011 and 2010, also includes restructuring

and restructuring related charges of $52.5 million and $52.6 million.  

(b)  Represents the increase in depreciation of revenue earning equipment based upon its revaluation relating to purchase accounting.

(c)  Represents an increase in depreciation of property and equipment relating to purchase accounting. For the three months ended December 31, 2011

and 2010, also includes restructuring and restructuring related charges of $5.0 million and $4.9 million, respectively.  For the years

ended December 31, 2011 and 2010, also includes restructuring and restructuring related charges of $13.7 million and $15.3 million, respectively.

For all periods presented, also includes other adjustments which are detailed in Table 5.    

(d)  Represents non-cash debt charges relating to the amortization and write off of deferred debt financing costs and debt discounts.  For the three months and year

ended December 31, 2010, also includes $12.0 million and $68.9 million, respectively, associated with the amortization of amounts pertaining to the

de-designation of our interest rate swaps as effective hedging instruments.  

(e)  Represents a provision for income taxes derived utilizing a normalized income tax rate (34% for 2011 and 2010).

(f)  Represents premiums paid to redeem our 10.5% Senior Subordinated Notes and a portion of our 8.875% Senior Notes.  








Table 3

HERTZ GLOBAL HOLDINGS, INC.

SEGMENT AND OTHER  INFORMATION

(In millions, except per share amounts)

Unaudited


















Three Months Ended


Year Ended


December 31,


December 31,


2011


2010


2011


2010

Revenues:








Car rental

$ 1,695.2


$ 1,548.0


$ 7,083.5


$ 6,486.2

Equipment rental

317.9


286.1


1,209.5


1,070.1

Other reconciling items

0.7


1.7


5.4


6.2


$ 2,013.8


$ 1,835.8


$ 8,298.4


$ 7,562.5









Depreciation of property and equipment:








Car rental

$      29.6


$      27.7


$    116.1


$    112.3

Equipment rental

8.3


8.3


33.7


34.3

Other reconciling items

2.3


1.8


8.2


7.4


$      40.2


$      37.8


$    158.0


$    154.0









Amortization of other intangible assets:








Car rental

$        9.5


$        6.9


$      32.7


$      30.2

Equipment rental

9.0


8.5


35.8


33.4

Other reconciling items

0.4


0.3


1.5


1.1


$      18.9


$      15.7


$      70.0


$      64.7









Income (loss) before income taxes:








Car rental

$    130.6


$      89.4


$    755.6


$    441.8

Equipment rental

45.1


16.9


69.3


(14.6)

Other reconciling items

(82.9)


(112.3)


(500.6)


(441.8)


$      92.8


$      (6.0)


$    324.3


$    (14.6)









Corporate EBITDA (a):








Car rental

$    202.1


$    166.9


$    984.2


$    758.9

Equipment rental

140.7


114.6


480.5


401.4

Other reconciling items

(7.6)


(14.0)


(75.2)


(60.0)


$    335.2


$    267.5


$ 1,389.5


$ 1,100.3









Adjusted pre-tax income (loss) (a):



Car rental

$    171.4


$    132.1


$    850.2


$    641.9

Equipment rental

62.1


35.0


161.6


78.0

Other reconciling items

(68.4)


(97.3)


(331.3)


(372.8)


$    165.1


$      69.8


$    680.5


$    347.1









Adjusted net income (loss) (a):



Car rental

$    113.1


$      87.2


$    561.1


$    423.6

Equipment rental

41.0


23.1


106.7


51.5

Other reconciling items

(50.1)


(68.7)


(238.2)


(263.4)


$    104.0


$      41.6


$    429.6


$    211.7









Adjusted diluted number of shares outstanding (a)    

437.2


410.0


444.8


410.0









Adjusted diluted earnings per share (a)    

$      0.24


$      0.10


$      0.97


$      0.52

















(a)        Represents a non-GAAP measure, see the accompanying reconciliations and definitions.

Note:  "Other Reconciling Items" includes general corporate expenses, certain interest expense (including net interest on

corporate debt), as well as other business activities such as our third-party claim management services.  See Tables 5

and 6.



Table 4

HERTZ GLOBAL HOLDINGS, INC.

SELECTED OPERATING AND FINANCIAL DATA

Unaudited


















Three


Percent




Percent


Months


change


Year


change


Ended, or as


from


Ended, or as


from


of Dec. 31,


prior year


of Dec. 31,


prior year


2011


period


2011


period

















Selected Car Rental Operating Data











Worldwide number of transactions (in thousands)    

6,512


3.0%


27,095


4.3%

Domestic (Hertz)

4,802


2.9%


19,903


4.2%

International (Hertz)

1,710


3.2%


7,192


4.7%









Worldwide transaction days (in thousands)    

32,594


7.2%


137,301


8.0%

Domestic (Hertz)

22,579


8.6%


93,741


8.5%

International (Hertz)

10,015


4.1%


43,560


6.9%









Worldwide rental rate revenue per transaction day (a)    

$            40.46


(4.2)%


$            41.62


(3.7)%

Domestic (Hertz)

$            39.04


(5.2)%


$            40.30


(4.4)%

International (Hertz) (b)

$            43.67


(1.9)%


$            44.47


(2.3)%









Worldwide average number of cars during period    

599,300


40.2%


615,600


38.3%

Domestic (Hertz company-operated)

310,100


8.5%


321,700


8.0%

International (Hertz company-operated)

151,200


6.5%


156,900


6.6%

Donlen (under lease and maintenance)

138,000


N/A


137,000


N/A









Worldwide revenue earning equipment, net (in millions)    

$         8,318.7


15.2%


$         8,318.7


15.2%


















Rental and rental related revenue (in millions) (a) (b)    

$            291.1


11.6%


$         1,094.4


12.1%

Same store revenue growth, including initiatives (a) (b)    

9.1%


N/M


9.3%


N/M

Average acquisition cost of revenue earning equipment operated    








during period (in millions)    

$         2,845.4


3.8%


$         2,804.8


2.6%

Worldwide revenue earning equipment, net (in millions)    

$         1,786.7


4.9%


$         1,786.7


4.9%


















Cash flows provided by operating activities

$            584.8


22.1%


$         2,233.3


1.1%

Corporate cash flow (a)  

721.6


N/M


(303.0)


N/M

EBITDA (a)  

840.9


21.0%


3,134.9


11.1%

Corporate EBITDA (a)  

335.2


25.3%


1,389.5


26.3%









Selected Balance Sheet Data (in millions)


December 31,




December 31,




2011




2010



Cash and cash equivalents  

$            931.8




$         2,374.2



Total revenue earning equipment, net

10,105.4




8,923.7



Total assets

17,673.5




17,345.0



Total debt    

11,317.1




11,306.4



Net corporate debt (a)    

3,678.6




3,364.5



Net fleet debt (a)    

6,398.7




5,360.1



Total net debt (a)    

10,077.3




8,724.6



Total equity

2,234.7




2,118.5



















(a)    Represents a non-GAAP measure, see the accompanying reconciliations and definitions.

(b)    Based on 12/31/10 foreign exchange rates.

N/M Percentage change not meaningful.
















Table 5

HERTZ GLOBAL HOLDINGS, INC.

RECONCILIATION OF GAAP TO NON-GAAP EARNINGS MEASURES

(In millions, except per share amounts)

Unaudited

















ADJUSTED PRE-TAX INCOME (LOSS) AND  ADJUSTED NET INCOME (LOSS)


























Three Months Ended December 31, 2011


Three Months Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total

Total revenues:

$ 1,695.2


$       317.9


$            0.7


$ 2,013.8


$ 1,548.0


$       286.1


$            1.7


$ 1,835.8

Expenses:
















Direct operating and selling, general and administrative

1,011.8


201.2


14.7


1,227.7


976.1


192.0


23.0


1,191.1

Depreciation of revenue earning equipment and lease charges

466.1


60.6


-


526.7


383.9


67.3


-


451.2

Interest expense

87.4


11.3


69.0


167.7


99.8


9.9


91.6


201.3

Interest income

(0.7)


(0.1)


(0.1)


(0.9)


(1.2)


-


(0.6)


(1.8)

Other (income) expense, net

-


(0.2)


-


(0.2)


-


-


-


-

Total expenses

1,564.6


272.8


83.6


1,921.0


1,458.6


269.2


114.0


1,841.8

Income (loss) before income taxes

130.6


45.1


(82.9)


92.8


89.4


16.9


(112.3)


(6.0)

Adjustments:
















Purchase accounting (a):
















Direct operating and selling, general and administrative

10.7


9.5


1.1


21.3


8.4


9.2


0.8


18.4

Depreciation of revenue earning equipment

4.2


-


-


4.2


-


3.6


-


3.6

Non-cash debt charges (b)

12.0


0.9


9.5


22.4


25.6


1.8


10.4


37.8

Restructuring charges (c)

9.3


7.8


(1.1)


16.0


4.6


3.3


1.2


9.1

Restructuring related charges (c)

4.6


(1.2)


(0.1)


3.3


4.3


0.2


0.8


5.3

Derivative (gains) losses (c)

-


-


(0.1)


(0.1)


(0.2)


-


0.9


0.7

Acquisition related costs (d)

-


-


5.2


5.2


-


-


0.9


0.9

Adjusted pre-tax income (loss)

171.4


62.1


(68.4)


165.1


132.1


35.0


(97.3)


69.8

Assumed (provision) benefit for income taxes of 34%

(58.3)


(21.1)


23.3


(56.1)


(44.9)


(11.9)


33.1


(23.7)

Noncontrolling interest

-


-


(5.0)


(5.0)


-


-


(4.5)


(4.5)

Adjusted net income (loss)

$    113.1


$         41.0


$         (50.1)


$    104.0


$      87.2


$         23.1


$         (68.7)


$      41.6

















Adjusted diluted number of shares outstanding







437.2








410.0

















Adjusted diluted earnings per share







$      0.24








$      0.10


































Year Ended December 31, 2011


Year Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total

Total revenues:

$ 7,083.5


$    1,209.5


$            5.4


$ 8,298.4


$ 6,486.2


$    1,070.1


$            6.2


$ 7,562.5

Expenses:
















Direct operating and selling, general and administrative

4,347.9


840.8


123.0


5,311.7


4,059.6


771.9


116.4


4,947.9

Depreciation of revenue earning equipment and lease charges

1,651.4


254.3


-


1,905.7


1,594.6


273.5


-


1,868.1

Interest expense

333.1


45.3


321.3


699.7


401.3


39.4


332.7


773.4

Interest income

(4.5)


(0.3)


(0.7)


(5.5)


(11.1)


(0.1)


(1.1)


(12.3)

Other (income) expense, net

-


0.1


62.4


62.5


-


-


-


-

Total expenses

6,327.9


1,140.2


506.0


7,974.1


6,044.4


1,084.7


448.0


7,577.1

Income (loss) before income taxes

755.6


69.3


(500.6)


324.3


441.8


(14.6)


(441.8)


(14.6)

Adjustments:
















Purchase accounting (a):
















Direct operating and selling, general and administrative

35.4


37.9


3.6


76.9


37.0


35.8


3.2


76.0

Depreciation of revenue earning equipment

4.2


6.5


-


10.7


-


14.3


-


14.3

Non-cash debt charges (b)

43.9


5.5


81.0


130.4


133.3


7.5


41.8


182.6

Restructuring charges (c)

16.6


40.5


(0.7)


56.4


18.1


34.7


1.9


54.7

Restructuring related charges (c)

7.0


1.9


0.9


9.8


11.9


0.3


1.0


13.2

Derivative (gains) losses (c)

0.6


-


(0.7)


(0.1)


(0.2)


-


3.4


3.2

Pension adjustment (c)

(13.1)


-


-


(13.1)


-


-


-


-

Acquisition related costs (d)

-


-


18.8


18.8


-


-


17.7


17.7

Management transition costs (d)

-


-


4.0


4.0


-


-


-


-

Premiums paid on debt (e)

-


-


62.4


62.4


-


-


-


-

Adjusted pre-tax income (loss)

850.2


161.6


(331.3)


680.5


641.9


78.0


(372.8)


347.1

Assumed (provision) benefit for income taxes of 34%

(289.1)


(54.9)


112.7


(231.3)


(218.3)


(26.5)


126.8


(118.0)

Noncontrolling interest

-


-


(19.6)


(19.6)


-


-


(17.4)


(17.4)

Adjusted net income (loss)    

$    561.1


$       106.7


$       (238.2)


$    429.6


$    423.6


$         51.5


$       (263.4)


$    211.7

















Adjusted diluted number of shares outstanding







444.8








410.0

















Adjusted diluted earnings per share







$      0.97








$      0.52

































(a)    Represents the purchase accounting effects of the acquisition of all of Hertz's common stock on December 21, 2005 on our results of operations relating to

increased depreciation and amortization of tangible and intangible assets and accretion of workers' compensation and public liability and property damage liabilities.  

Also represents the purchase accounting effects of subsequent acquisitions on our results of operations relating to increased depreciation and amortization of intangible assets.

(b)  Represents non-cash debt charges relating to the amortization and write off of deferred debt financing costs and debt discounts.  For the three months and year

ended December 31, 2010, also includes $12.0 million and $68.9 million, respectively, associated with the amortization of amounts pertaining to the

de-designation of our interest rate swaps as effective hedging instruments.  

(c)    Amounts are included within direct operating and selling, general and administrative expense in our statement of operations.

(d)    Amounts are included within selling, general and administrative expense in our statement of operations.

(e)     Represents premiums paid to redeem our 10.5% Senior Subordinated Notes and a portion of our 8.875% Senior Notes.  These costs

are included within other (income) expense, net in our statement of operations.
















Table 6

HERTZ GLOBAL HOLDINGS, INC.

RECONCILIATION OF GAAP TO NON-GAAP EARNINGS MEASURES

(In millions)

Unaudited

















EBITDA, CORPORATE EBITDA, UNLEVERED PRE-TAX CASH FLOW,









LEVERED AFTER-TAX CASH FLOW BEFORE  FLEET GROWTH AND CORPORATE CASH FLOW


























Three Months Ended December 31, 2011


Three Months Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total





Income (loss) before income taxes

$   130.6


$         45.1


$         (82.9)


$     92.8


$     89.4


$         16.9


$       (112.3)


$               (6.0)

Depreciation, amortization and other purchase accounting

505.4


77.8


3.1


586.3


419.6


84.2


2.3


506.1

Interest, net of interest income

86.7


11.2


68.9


166.8


98.6


9.9


91.0


199.5

Noncontrolling interest

-


-


(5.0)


(5.0)


-


-


(4.5)


(4.5)

EBITDA

722.7


134.1


(15.9)


840.9


607.6


111.0


(23.5)


695.1

Adjustments:
















Car rental fleet interest

(82.3)


-


-


(82.3)


(93.5)


-


-


(93.5)

Car rental fleet depreciation

(466.1)


-


-


(466.1)


(383.9)


-


-


(383.9)

Non-cash expenses and charges (a)

13.9


-


4.3


18.2


27.8


0.1


6.6


34.5

Extraordinary, unusual or non-recurring gains and losses (b)

13.9


6.6


4.0


24.5


8.9


3.5


2.9


15.3

Corporate EBITDA

$   202.1


$       140.7


$           (7.6)


335.2


$   166.9


$       114.6


$         (14.0)


267.5

Non-fleet capital expenditures, net







(73.8)








(31.5)

Changes in working capital:
















Receivables, excluding car rental fleet receivables







72.2








79.7

Accounts payable and capital leases







(104.5)








(21.0)

Accrued liabilities and other







(85.0)








(116.0)

Acquisition and other investing activities







(4.3)








(34.2)

Other financing activities, excluding debt







(14.8)








(28.7)

Foreign exchange impact on cash and cash equivalents







(10.2)








24.0

Unlevered pre-tax cash flow







114.8








139.8

Corporate net cash interest







(95.3)








(30.6)

Corporate cash taxes







(17.1)








(9.2)

Levered after-tax cash flow before fleet growth







2.4








100.0

Equipment rental revenue earning equipment expenditures, net of disposal proceeds




(69.1)








(76.9)

Car rental fleet equity requirement







788.3








388.3

Corporate cash flow







$   721.6








$             411.4


















Year Ended December 31, 2011


Year Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total





Income (loss) before income taxes

$   755.6


$         69.3


$       (500.6)


$   324.3


$   441.8


$       (14.6)


$       (441.8)


$             (14.6)

Depreciation, amortization and other purchase accounting

1,801.3


323.8


10.9


2,136.0


1,740.9


341.6


9.8


2,092.3

Interest, net of interest income

328.6


45.0


320.6


694.2


390.2


39.3


331.6


761.1

Noncontrolling interest

-


-


(19.6)


(19.6)


-


-


(17.4)


(17.4)

EBITDA

2,885.5


438.1


(188.7)


3,134.9


2,572.9


366.3


(117.8)


2,821.4

Adjustments:
















Car rental fleet interest

(306.2)


-


-


(306.2)


(384.4)


-


-


(384.4)

Car rental fleet depreciation

(1,651.4)


-


-


(1,651.4)


(1,594.6)


-


-


(1,594.6)

Non-cash expenses and charges (a)

32.7


-


28.1


60.8


135.0


0.1


37.2


172.3

Extraordinary, unusual or non-recurring gains and losses (b)

23.6


42.4


85.4


151.4


30.0


35.0


20.6


85.6

Corporate EBITDA

$   984.2


$       480.5


$         (75.2)


1,389.5


$   758.9


$       401.4


$         (60.0)


1,100.3

Non-fleet capital expenditures, net







(227.9)








(140.3)

Changes in working capital:
















Receivables, excluding car rental fleet receivables







(64.9)








(32.0)

Accounts payable and capital leases







(58.6)








383.6

Accrued liabilities and other







(192.6)








(142.9)

Acquisition and other investing activities







(259.4)








(41.4)

Other financing activities, excluding debt







(109.3)








(93.4)

Foreign exchange impact on cash and cash equivalents







3.8








(10.3)

Unlevered pre-tax cash flow







480.6








1,023.6

Corporate net cash interest







(390.1)








(328.9)

Corporate cash taxes







(49.6)








(50.7)

Levered after-tax cash flow before fleet growth







40.9








644.0

Equipment rental revenue earning equipment expenditures, net of disposal proceeds




(359.8)








(145.0)

Car rental fleet equity requirement







15.9








(184.0)

Corporate cash flow







$  (303.0)








$             315.0














































Table 6 (pg. 2)

















(a) As defined in the credit agreements for the senior credit facilities, Corporate EBITDA excludes the impact of certain non-cash expenses and charges.  The adjustments

reflect the following:

















NON-CASH EXPENSES AND CHARGES

Three Months Ended December 31, 2011


Three Months Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total

















Non-cash amortization of debt costs included
















in car rental fleet interest

$     11.7


$              -


$               -


$     11.7


$     25.3


$              -


$               -


$               25.3

Non-cash stock-based employee
















compensation charges

2.2


-


4.4


6.6


2.7


0.1


5.7


8.5

Derivative (gains) losses

-


-


(0.1)


(0.1)


(0.2)


-


0.9


0.7

Total non-cash expenses and charges

$     13.9


$              -


$            4.3


$     18.2


$     27.8


$           0.1


$            6.6


$               34.5

















NON-CASH EXPENSES AND CHARGES

Year Ended December 31, 2011


Year Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total

















Non-cash amortization of debt costs included
















in car rental fleet interest

$     43.0


$              -


$               -


$     43.0


$   132.5


$              -


$               -


$             132.5

Non-cash stock-based employee
















compensation charges

2.2


-


28.8


31.0


2.7


0.1


33.8


36.6

Derivative (gains) losses

0.6


-


(0.7)


(0.1)


(0.2)


-


3.4


3.2

Pension adjustment

(13.1)


-


-


(13.1)


-


-


-


-

Total non-cash expenses and charges

$     32.7


$              -


$          28.1


$     60.8


$   135.0


$           0.1


$          37.2


$             172.3

































(b) As defined in the credit agreements for the senior credit facilities, Corporate EBITDA excludes the impact of extraordinary, unusual or non-recurring gains or losses or charges or

credits.   The adjustments reflect the following:

















EXTRAORDINARY, UNUSUAL OR
















NON-RECURRING ITEMS

Three Months Ended December 31, 2011


Three Months Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total

















Restructuring charges

$       9.3


$           7.8


$           (1.1)


$     16.0


$       4.6


$           3.3


$            1.2


$                 9.1

Restructuring related charges

4.6


(1.2)


(0.1)


3.3


4.3


0.2


0.8


5.3

Acquisition related costs

-


-


5.2


5.2


-


-


0.9


0.9

Total extraordinary, unusual or non-recurring items

$     13.9


$           6.6


$            4.0


$     24.5


$       8.9


$           3.5


$            2.9


$               15.3

















EXTRAORDINARY, UNUSUAL OR
















NON-RECURRING ITEMS

Year Ended December 31, 2011


Year Ended December 31, 2010






Other








Other




Car


Equipment


Reconciling




Car


Equipment


Reconciling




Rental


Rental


Items


Total


Rental


Rental


Items


Total

















Restructuring charges

$     16.6


$         40.5


$           (0.7)


$     56.4


$     18.1


$         34.7


$            1.9


$               54.7

Restructuring related charges

7.0


1.9


0.9


9.8


11.9


0.3


1.0


13.2

Acquisition related costs

-


-


18.8


18.8


-


-


17.7


17.7

Premiums paid on debt

-


-


62.4


62.4


-


-


-


-

Management transition costs

-


-


4.0


4.0


-


-


-


-

Total extraordinary, unusual or non-recurring items

$     23.6


$         42.4


$          85.4


$   151.4


$     30.0


$         35.0


$          20.6


$               85.6











Table 7

HERTZ GLOBAL HOLDINGS, INC.

RECONCILIATION OF GAAP TO NON-GAAP EARNINGS MEASURES

(In millions, except as noted)

Unaudited










Three Months Ended


Year Ended



RECONCILIATION FROM OPERATING


December 31,


December 31,



CASH FLOWS TO EBITDA:


2011


2010


2011


2010










Net cash provided by operating activities


$            584.8


$              479.1


$         2,233.3


$           2,208.7



Amortization and write-off of debt costs    


(22.4)


(25.8)


(130.3)


(113.8)



Provision for losses on doubtful accounts    


(7.0)


(4.5)


(28.2)


(19.7)



Derivative gains (losses)


(6.3)


5.6


8.0


(10.8)



Gain on revaluation of foreign denominated debt


26.6


-


26.6


-



Gain on sale of property and equipment    


38.3


3.1


43.5


5.7



Amortization of cash flow hedges    


-


(12.0)


-

-

(68.9)



Stock-based compensation charges    


(6.7)


(8.5)


(31.1)


(36.6)



Asset writedowns    


(0.4)


(0.9)


(23.2)


(20.4)



Lease charges


23.8


21.1


96.1


78.2



Noncontrolling interest    


(5.0)


(4.5)


(19.6)


(17.4)



Deferred income taxes    


(40.3)


(4.2)


(68.1)


26.5



Provision for taxes on income    


40.7


17.6


128.5


16.7



Interest expense, net of interest income  


166.8


199.5


694.2


761.1



Changes in assets and liabilities  


48.0


29.5


205.2


12.1



EBITDA


$            840.9


$              695.1


$         3,134.9


$           2,821.4

























NET CORPORATE DEBT, NET FLEET DEBT


December 31,


September 30,


December 31,


September 30,


December 31,

AND TOTAL NET DEBT


2011


2011


2010


2010


2009












Total Corporate Debt


$         4,704.8


$           4,942.4


$         5,830.7


$           5,334.7


$         4,689.4

Total Fleet Debt


6,612.3


7,563.9


5,475.7


6,712.2


5,675.0

Total Debt


$       11,317.1


$         12,506.3


$       11,306.4


$         12,046.9


$       10,364.4












Corporate Restricted Cash











Restricted Cash, less:


$            308.0


$              332.8


$            207.6


$              739.6


$            365.2

Restricted Cash Associated with Fleet Debt    


(213.6)


(215.6)


(115.6)


(663.4)


(295.0)

Corporate Restricted Cash


$              94.4


$              117.2


$              92.0


$                76.2


$              70.2












Net Corporate Debt











Corporate Debt, less:


$         4,704.8


$           4,942.4


$         5,830.7


$           5,334.7


$         4,689.4

Cash and Cash Equivalents


(931.8)


(385.8)


(2,374.2)


(1,483.3)


(985.6)

Corporate Restricted Cash


(94.4)


(117.2)


(92.0)


(76.2)


(70.2)

Net Corporate Debt


$         3,678.6