HERC HOLDINGS INC - FORM 8-K - EX-99.2 - EXHIBIT 99.2 - August 10, 2015

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Exhibit 99.2
FINANCIAL INFORMATION AND OPERATING DATA

SELECTED UNAUDITED CONSOLIDATED INCOME STATEMENT DATA
 
 
Three Months Ended March 31,
 
Three Months Ended
March 31,
(In millions, except per share data)
 
2015
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Total revenues
 
$
2,454

 
$
2,536

 
$
2,437

 
$
2,437

 
$
2,436

Expenses:
 
 

 
 

 
 

 
 

 
 

Direct operating
 
1,408

 
1,443

 
1,364

 
1,358

 
1,351

Depreciation of revenue earning equipment and lease charges, net
 
707

 
726

 
589

 
580

 
587

Selling, general and administrative
 
266

 
276

 
250

 
248

 
252

Interest expense, net
 
154

 
156

 
175

 
175

 
175

Other income, net
 
5

 
(3
)
 
—

 
2

 
(1
)
Total expenses
 
2,540

 
2,598

 
2,378

 
2,363

 
2,364

Income (loss) before income taxes
 
(86
)
 
(62
)
 
59

 
74

 
72

(Provision) benefit for taxes on income (loss)
 
16

 
(7
)
 
(53
)
 
(58
)
 
(54
)
Net income (loss)
 
$
(70
)
 
$
(69
)
 
$
6

 
$
16

 
$
18

Weighted average number of shares outstanding:
 
 

 
 

 
 

 
 

 
 

Basic
 
459

 
447

 
416

 
416

 
416

Diluted
 
459

 
447

 
461

 
461

 
461

Earnings per share:
 
 

 
 

 
 

 
 

 
 

Basic
 
$
(0.15
)
 
$
(0.15
)
 
$
0.01

 
$
0.04

 
$
0.04

Diluted
 
$
(0.15
)
 
$
(0.15
)
 
$
0.02

 
$
0.04

 
$
0.04

Corporate EBITDA (a)
 
$
226

 
$
254

 
$
359

 
NR

 
$
367

Adjusted pre-tax Income (loss) (a)
 
3

 
24

 
136

 
NR

 
145

(a)        Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule III.
 
SELECTED UNAUDITED CONSOLIDATED BALANCE SHEET DATA
 
 
As of March 31,
 
As of December
31, 2013
(In millions)
 
2015
 
2014
 
As Revised
Cash and cash equivalents
 
$
585

 
$
498

 
$
411

Restricted cash
 
411

 
453

 
861

Revenue earning equipment:
 
 

 
 

 
 

U.S. Car Rental
 
8,814

 
8,662

 
8,629

International Car Rental
 
2,021

 
2,245

 
2,047

Worldwide Equipment Rental
 
2,473

 
2,440

 
2,416

All Other Operations
 
1,285

 
1,157

 
1,099

Total revenue earning equipment, net
 
14,593

 
14,504

 
14,191

Total assets
 
24,602

 
24,470

 
24,423

Total debt
 
16,351

 
16,125

 
16,309

Net Fleet debt (a)
 
9,548

 
9,148

 
9,034

Net Corporate debt (a) (b)
 
5,807

 
6,026

 
6,003

Total equity
 
2,349

 
2,491

 
2,567

(a)        Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule VI.
(b)        Fleet related to Hertz Equipment Rental Corporation is funded via Corporate Debt.

1



SELECTED UNAUDITED CONSOLIDATED CASH FLOW DATA

 
 
Three Months Ended
March 31,
 
Three Months Ended March 31,
(In millions)
 
2015
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Cash provided by (used in):
 
 

 
 

 
 

 
 

 
 

Operating activities
 
$
782

 
$
760

 
$
746

 
$
747

 
$
743

Investing activities
 
(1,166
)
 
(372
)
 
(946
)
 
(950
)
 
(932
)
Financing activities
 
499

 
(301
)
 
317

 
318

 
318

Effect of exchange rate changes
 
(20
)
 
—

 
(8
)
 
(8
)
 
(8
)
Net change in cash and cash equivalents
 
$
95

 
$
87

 
$
109

 
$
107

 
$
121

Fleet growth (a)
 
$
171

 
$
—

 
$
(196
)
 
NR

 
$
(194
)
Free cash flow (a)
 
189

 
3

 
(76
)
 
(73
)
 
(79
)
(a)
Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedules IV and V.

SELECTED UNAUDITED OPERATING DATA BY SEGMENT
 
 
 
Three Months Ended March 31,
 
Three Months
Ended March 31,
 
 
2015
 
2014
 
2013
As Restated
 
2013
As Reported
U.S. Car Rental
 
 

 
 

 
 

 
 

Transaction days (in thousands)
 
32,036

 
32,360

 
30,064

 
30,064

Total RPD(a)
 
$
47.07

 
$
47.90

 
$
48.63

 
$
49.35

Average fleet
 
489,300

 
491,500

 
454,000

 
457,700

Fleet efficiency(a)
 
73
%
 
75
%
 
77
%
 
NR

Net depreciation per unit per month(a)
 
$
287

 
$
288

 
$
209

 
NR

Program cars as a percentage of total average fleet at period end
 
24
%
 
15
%
 
4
%
 
NR

Adjusted pre-tax income (loss) (in millions)(a)
 
$
71

 
$
119

 
$
232

 
NR

International Car Rental
 
 

 
 

 
 

 
 

Transaction days (in thousands)
 
9,775

 
9,395

 
9,006

 
9,006

Total RPD(a)(b)
 
$
46.96

 
$
51.41

 
$
51.63

 
$
52.76

Average Fleet
 
144,000

 
141,400

 
137,500

 
137,500

Fleet efficiency(a)
 
75
%
 
74
%
 
73
%
 
NR

Net depreciation per unit per month(a)
 
$
231

 
$
266

 
$
301

 
NR

Program cars as a percentage of total average fleet at period end
 
38
%
 
34
%
 
28
%
 
NR

Adjusted pre-tax income (loss) (in millions)(a)
 
$
8

 
$
(39
)
 
$
(47
)
 
NR

Worldwide Equipment Rental
 
 

 
 

 
 

 
 

Dollar utilization
 
34
%
 
34
%
 
35
%
 
NR

Time utilization
 
61
%
 
61
%
 
61
%
 
NR

Rental and rental related revenue (in millions)(a)(b)
 
$
336

 
$
334

 
$
320

 
$
322

Same store revenue growth, including growth
initiatives(b)
 
1
%
 
5
%
 
13
%
 
13
%
Adjusted pre-tax income (loss) (in millions)(a)
 
$
33

 
$
52

 
$
45

 
$
46

All Other Operations
 
 

 
 

 
 

 
 

Average fleet — Donlen
 
168,600

 
176,800

 
165,600

 
165,600

Adjusted pre-tax income (loss) (in millions)(a)
 
$
16

 
$
16

 
$
13

 
NR

 
(a)
Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedules III and VI.
(b)
Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.

2



SUPPLEMENTAL SCHEDULES AND DEFINITIONS
 
The following Supplemental Schedules and definitions are provided to present segment results and reconciliations of non-GAAP measures to their most comparable GAAP measure. Following the Supplemental Schedules we provide definitions for terminology used throughout these schedules.
 
Supplemental Schedule I

HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
 
Three Months Ended March 31, 2015
 
Three Months Ended March 31, 2014
(in millions)
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Corporate
 
Consolidated HGH
 
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Corporate
 
Consolidated HGH
Total revenues:
$
1,520

 
$
436

 
$
355

 
$
143

 
$
—

 
$
2,454

 
$
1,557

 
$
482

 
$
358

 
$
139

 
$
—

 
$
2,536

Expenses:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct operating
926

 
267

 
208

 
6

 
1

 
1,408

 
907

 
329

 
200

 
7

 
—

 
1,443

Depreciation of revenue earning equipment and lease charges, net
421

 
95

 
76

 
115

 
—

 
707

 
424

 
113

 
78

 
111

 
—

 
726

Selling, general and administrative
98

 
57

 
46

 
8

 
57

 
266

 
101

 
65

 
32

 
6

 
72

 
276

Interest expense, net
40

 
15

 
15

 
2

 
82

 
154

 
38

 
20

 
13

 
4

 
81

 
156

Other (income) expense, net
—

 
—

 
(1
)
 
—

 
6

 
5

 
(7
)
 
—

 
(1
)
 
—

 
5

 
(3
)
Total expenses
1,485

 
434

 
344

 
131

 
146

 
2,540

 
1,463

 
527

 
322

 
128

 
158

 
2,598

Income (loss) before income taxes
$
35

 
$
2

 
$
11

 
$
12

 
$
(146
)
 
$
(86
)
 
$
94

 
$
(45
)
 
$
36

 
$
11

 
$
(158
)
 
$
(62
)
Provision for taxes on income
 

 
 

 
 

 
 

 
 

 
16

 
 

 
 

 
 

 
 

 
 

 
(7
)
Net income (loss)
 

 
 

 
 

 
 

 
 

 
$
(70
)
 
 

 
 

 
 

 
 

 
 

 
$
(69
)
 

3



Supplemental Schedule I (continued)
HERTZ GLOBAL HOLDINGS, INC.    
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
 
Three Months Ended March 31, 2013
As Restated
 
Three Months
Ended March
31, 2013
As Revised
 
Three Months
Ended March
31, 2013
As Reported
(In millions)
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Corporate
 
Consolidated HGH
 
Consolidated
HGH
 
Consolidated
HGH
Total revenues:
$
1,484

 
$
471

 
$
353

 
$
129

 
$
—

 
$
2,437

 
$
2,437

 
$
2,436

Expenses:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct operating
847

 
313

 
203

 
6

 
(5
)
 
1,364

 
1,358

 
1,351

Depreciation of revenue earning equipment and lease charges, net
285

 
125

 
74

 
105

 
—

 
589

 
580

 
587

Selling, general and administrative
101

 
65

 
33

 
7

 
44

 
250

 
248

 
252

Interest expense, net
46

 
26

 
13

 
2

 
88

 
175

 
175

 
175

Other (income) expense, net
1

 
—

 
(1
)
 
—

 
—

 
—

 
2

 
(1
)
Total expenses
1,280

 
529

 
322

 
120

 
127

 
2,378

 
2,363

 
2,364

Income (loss) before income taxes
$
204

 
$
(58
)
 
$
31

 
$
9

 
$
(127
)
 
$
59

 
$
74

 
$
72

Provision for taxes on income
 

 
 

 
 

 
 

 
 

 
(53
)
 
(58
)
 
(54
)
Net income (loss)
 

 
 

 
 

 
 

 
 

 
$
6

 
$
16

 
$
18


4



Supplemental Schedule II
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
 
Three Months Ended
March 31, 2015
 
Three Months Ended
March 31, 2014
 
Three Months Ended
March 31, 2013 as Restated
 
Three Months Ended
March 31, 2013 as Reported
(In millions, except per share data)
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
Total revenues
$
2,454

 
$
—

 
$
2,454

 
$
2,536

 
$
—

 
$
2,536

 
$
2,437

 
$
—

 
$
2,437

 
$
2,436

 
$
—

 
$
2,436

Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Direct operating
1,408

 
(33
)
 
1,375

 
1,443

 
(46
)
 
1,397

 
1,364

 
(36
)
 
1,328

 
1,351

 
(36
)
 
1,315

Depreciation of revenue earning equipment and lease charges, net
707

 
—

 
707

 
726

 
(2
)
 
724

 
589

 
(4
)
 
585

 
587

 
(4
)
 
583

Selling, general and administrative
266

 
(37
)
 
229

 
276

 
(38
)
 
238

 
250

 
(18
)
 
232

 
252

 
(16
)
 
236

Interest expense, net
154

 
(16
)
 
138

 
156

 
(12
)
 
144

 
175

 
(17
)
 
158

 
175

 
(17
)
 
158

Other (income) expense, net
5

 
(3
)
 
2

 
(3
)
 
12

 
9

 
—

 
(2
)
 
(2
)
 
(1
)
 
—

 
(1
)
Total expenses
2,540

 
(89
)
 
2,451

 
2,598

 
(86
)
 
2,512

 
2,378

 
(77
)
 
2,301

 
2,364

 
(73
)
 
2,291

Income (loss) before income taxes
(86
)
 
89

 
3

 
(62
)
 
86

 
24

 
59

 
77

 
136

 
72

 
73

 
145

(Provision) benefit for taxes on income (loss)
16

 
(33
)
(a)
(17
)
 
(7
)
 
(32
)
(a)
(39
)
 
(53
)
 
(27
)
(a)
(80
)
 
(54
)
 
3

(a)
(51
)
Net income (loss)
$
(70
)
 
$
56

 
$
(14
)
 
$
(69
)
 
$
54

 
$
(15
)
 
$
6

 
$
50

 
$
56

 
$
18

 
$
76

 
$
94

Weighted average number of diluted shares outstanding
459

 
459

 
459

 
447

 
447

 
447

 
461

 
461

 
461

 
461

 
461

 
461

Diluted earnings (loss) per share (b)
$
(0.15
)
 
$
0.12

 
$
(0.03
)
 
$
(0.15
)
 
$
0.12

 
$
(0.03
)
 
$
0.02

 
$
0.11

 
$
0.12

 
$
0.04

 
NR

 
$
0.21

(a) Represents a provision for income taxes derived utilizing a normalized income tax rate (37% for 2015 and 2014 and 35% for 2013).
(b) Net income (loss) used in diluted earnings per share calculation includes an adjustment to add back to net income the amount of interest expense on convertible senior notes, net of tax of $1 million, for the quarter ended March 31, 2013.

5



Supplemental Schedule III 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME TAXES
TO EBITDA, CORPORATE EBITDA AND ADJUSTED PRE-TAX INCOME BY SEGMENT
Unaudited
 
Three Months Ended March 31, 2015
 
Three Months Ended March 31, 2014
(In millions)
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Corporate
 
Consolidated HGH
 
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Corporate
 
Consolidated HGH
Income (loss) before income taxes
$
35

 
$
2

 
$
11

 
$
12

 
$
(146
)
 
$
(86
)
 
$
94

 
$
(45
)
 
$
36

 
$
11

 
$
(158
)
 
$
(62
)
Depreciation and amortization
472

 
105

 
95

 
117

 
4

 
793

 
479

 
123

 
96

 
113

 
5

 
816

Interest, net of interest income
40

 
15

 
15

 
2

 
82

 
154

 
38

 
20

 
13

 
4

 
81

 
156

EBITDA
$
547

 
$
122

 
$
121

 
$
131

 
$
(60
)
 
$
861

 
$
611

 
$
98

 
$
145

 
$
128

 
$
(72
)
 
$
910

Car rental fleet depreciation
(421
)
 
(95
)
 
—

 
(115
)
 
—

 
(631
)
 
(424
)
 
(113
)
 
—

 
(111
)
 
—

 
(648
)
Car rental fleet interest
(43
)
 
(15
)
 
—

 
(3
)
 
—

 
(61
)
 
(39
)
 
(20
)
 
—

 
(4
)
 
—

 
(63
)
Car rental fleet debt - related charges
8

 
2

 
—

 
1

 
—

 
11

 
1

 
3

 
—

 
2

 
—

 
6

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
4

 
4

 
—

 
—

 
—

 
—

 
8

 
8

Restructuring and restructuring related charges
2

 
2

 
2

 
—

 
14

 
20

 
11

 
5

 
3

 
—

 
20

 
39

Acquisition related costs and charges
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
7

 
7

Integration expenses
(1
)
 
—

 
—

 
—

 
1

 
—

 
(2
)
 
—

 
—

 
—

 
2

 
—

Equipment Rental spin-off costs
—

 
—

 
9

 
—

 
—

 
9

 
—

 
—

 
—

 
—

 
—

 
—

Relocation costs
(2
)
 
—

 
—

 
—

 
2

 
—

 
(2
)
 
—

 
—

 
—

 
2

 
—

Premiums paid on debt
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Loss on extinguishment of debt
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Impairment charges and asset write-downs
9

 
—

 
—

 
—

 
—

 
9

 
—

 
—

 
—

 
—

 
—

 
—

Other extraordinary, unusual or non-recurring items
1

 
—

 
—

 
—

 
3

 
4

 
(1
)
 
(5
)
 
1

 
—

 
—

 
(5
)
Corporate EBITDA
$
100

 
$
16

 
$
132

 
$
14

 
$
(36
)
 
$
226

 
$
155

 
$
(32
)
 
$
149

 
$
15

 
$
(33
)
 
$
254

Non-fleet depreciation and amortization
(51
)
 
(10
)
 
(95
)
 
(2
)
 
(4
)
 
(162
)
 
(55
)
 
(10
)
 
(96
)
 
(2
)
 
(5
)
 
(168
)
Non-fleet interest, net of interest income
3

 
—

 
(15
)
 
1

 
(82
)
 
(93
)
 
1

 
—

 
(13
)
 
—

 
(81
)
 
(93
)
Non-fleet debt - related charges
—

 
—

 
1

 
—

 
4

 
5

 
—

 
—

 
2

 
—

 
4

 
6

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
(4
)
 
(4
)
 
—

 
—

 
—

 
—

 
(8
)
 
(8
)
Acquisition accounting
19

 
2

 
10

 
3

 
(3
)
 
31

 
18

 
3

 
10

 
3

 
(1
)
 
33

Adjusted Pre-Tax Income (Loss)
$
71

 
$
8

 
$
33

 
$
16

 
$
(125
)
 
$
3

 
$
119

 
$
(39
)
 
$
52

 
$
16

 
$
(124
)
 
$
24



6



Supplemental Schedule III (continued)
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME TAXES
TO EBITDA, CORPORATE EBITDA AND ADJUSTED PRE-TAX INCOME BY SEGMENT
 
Three Months Ended March 31, 2013
As Restated
 
Three Months
Ended March
31, 2013
As Reported
(In millions)
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Corporate
 
Consolidated HGH
 
Consolidated
HGH
Income (loss) before income taxes
$
204

 
$
(58
)
 
$
31

 
$
9

 
$
(127
)
 
$
59

 
$
72

Depreciation and amortization
338

 
133

 
93

 
107

 
2

 
673

 
669

Interest, net of interest income
46

 
26

 
13

 
2

 
88

 
175

 
175

EBITDA
$
588

 
$
101

 
$
137

 
$
118

 
$
(37
)
 
$
907

 
$
916

Car rental fleet depreciation
(285
)
 
(125
)
 
—

 
(105
)
 
—

 
(515
)
 
(513
)
Car rental fleet interest
(45
)
 
(24
)
 
—

 
(2
)
 
—

 
(71
)
 
(71
)
Car rental fleet debt - related charges
2

 
3

 
—

 
—

 
—

 
5

 
5

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
8

 
8

 
8

Restructuring and restructuring related charges
1

 
5

 
—

 
—

 
1

 
7

 
8

Acquisition related costs and charges
—

 
—

 
—

 
—

 
3

 
3

 
3

Integration expenses
5

 
—

 
—

 
—

 
6

 
11

 
11

Equipment Rental spin-off costs
—

 
—

 
—

 
—

 
—

 
—

 
—

Relocation costs
—

 
—

 
—

 
—

 
—

 
—

 
—

Premiums paid on debt
—

 
—

 
—

 
—

 
—

 
—

 
—

Loss on extinguishment of debt
—

 
—

 
—

 
—

 
—

 
—

 
—

Impairment charges and asset write-downs
—

 
—

 
—

 
—

 
—

 
—

 
—

Other extraordinary, unusual or non-recurring items
2

 
1

 
3

 
—

 
(2
)
 
4

 
—

Corporate EBITDA
$
268

 
$
(39
)
 
$
140

 
$
11

 
$
(21
)
 
$
359

 
$
367

Non-fleet depreciation and amortization
(53
)
 
(8
)
 
(93
)
 
(2
)
 
(2
)
 
(158
)
 
(156
)
Non-fleet interest, net of interest income
(1
)
 
(2
)
 
(13
)
 
—

 
(88
)
 
(104
)
 
(104
)
Non-fleet debt - related charges
—

 
—

 
1

 
—

 
11

 
12

 
12

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
(8
)
 
(8
)
 
(8
)
Acquisition accounting
18

 
2

 
10

 
4

 
1

 
35

 
34

Adjusted Pre-Tax Income (Loss)
$
232

 
$
(47
)
 
$
45

 
$
13

 
$
(107
)
 
$
136

 
$
145



7



Supplemental Schedule IV
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FREE CASH FLOW
Unaudited
 
 
Three Months Ended
March 31,
 
Three Months Ended
March 31,
(In millions)
 
2015
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Income before income taxes
 
$
(86
)
 
$
(62
)
 
$
59

 
$
74

 
$
72

Depreciation and amortization, non-fleet assets
 
86

 
90

 
84

 
81

 
51

Amortization of debt discount and related charges
 
16

 
11

 
17

 
17

 
48

Cash paid for income taxes
 
(4
)
 
(14
)
 
(6
)
 
(6
)
 
(6
)
Changes in assets and liabilities, net of effects of acquisitions, and other
 
81

 
28

 
20

 
16

 
6

Net cash provided by operating activities excluding depreciation of revenue earning equipment
 
93

 
53

 
174

 
182

 
172

U.S. car rental fleet growth (a)
 
(12
)
 
(71
)
 
(318
)
 
NR

 
NR

International car rental fleet growth (a)
 
203

 
88

 
168

 
NR

 
NR

Equipment rental fleet growth (a)
 
18

 
(10
)
 
(41
)
 
NR

 
NR

All other operations rental fleet growth (a)
 
(38
)
 
(7
)
 
(5
)
 
NR

 
NR

Property and equipment expenditures, net of disposals
 
(75
)
 
(50
)
 
(54
)
 
(57
)
 
(57
)
Net investment activity
 
96

 
(50
)
 
(250
)
 
(255
)
 
(251
)
Free cash flow
 
$
189

 
$
3

 
$
(76
)
 
$
(73
)
 
$
(79
)

(a)        Historically, fleet growth has not been reported on a segment basis.

8



Supplemental Schedule V
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FLEET GROWTH
Unaudited
 
Three Months Ended March 31, 2015
 
Three Months Ended March 31, 2014
 
Three Months Ended March 31, 2013
As Restated
 
Three Months
Ended March
31, 2013
As Reported
(In millions)
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Consolidated
HGH
 
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Consolidated
HGH
 
U.S. Car Rental
 
Int'l Car Rental
 
Worldwide Equipment Rental
 
All Other Operations
 
Consolidated
HGH
 
Consolidated
HGH
Revenue earning equipment expenditures
$
(2,444
)
 
$
(515
)
 
$
(121
)
 
$
(358
)
 
$
(3,438
)
 
$
(1,589
)
 
$
(509
)
 
$
(109
)
 
$
(375
)
 
$
(2,582
)
 
$
(2,385
)
 
$
(485
)
 
$
(154
)
 
$
(230
)
 
$
(3,254
)
 
$
(3,253
)
Proceeds from disposal of revenue earning equipment
1,368

 
658

 
62

 
201

 
2,289

 
1,018

 
610

 
21

 
211

 
1,860

 
1,447

 
625

 
39

 
125

 
2,236

 
2,238

Net revenue earning equipment capital expenditures
(1,076
)
 
143

 
(59
)
 
(157
)
 
(1,149
)
 
(571
)
 
101

 
(88
)
 
(164
)
 
(722
)
 
(938
)
 
140

 
(115
)
 
(105
)
 
(1,018
)
 
(1,015
)
Depreciation of revenue earning equipment
421

 
77

 
77

 
113

 
688

 
422

 
95

 
78

 
111

 
706

 
285

 
109

 
74

 
104

 
572

 
572

Financing activity related to car rental fleet:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Borrowings
2,516

 
245

 
—

 
83

 
2,844

 
310

 
270

 
—

 
400

 
980

 
1,543

 
245

 
—

 
—

 
1,788

 
NR

Payments
(2,007
)
 
(278
)
 
—

 
(67
)
 
(2,352
)
 
(631
)
 
(354
)
 
—

 
(350
)
 
(1,335
)
 
(1,366
)
 
(292
)
 
—

 
(1
)
 
(1,659
)
 
NR

Restricted cash changes
134

 
16

 
—

 
(10
)
 
140

 
399

 
(24
)
 
—

 
(4
)
 
371

 
158

 
(34
)
 
—

 
(3
)
 
121

 
NR

Net financing activity related to car rental fleet
643

 
(17
)
 
—

 
6

 
632

 
78

 
(108
)
 
—

 
46

 
16

 
335

 
(81
)
 
—

 
(4
)
 
250

 
250

Fleet growth
$
(12
)
 
$
203

 
$
18

 
$
(38
)
 
$
171

 
$
(71
)
 
$
88

 
$
(10
)
 
$
(7
)
 
$
—

 
$
(318
)
 
$
168

 
$
(41
)
 
$
(5
)
 
$
(196
)
 
$
(194
)

9



Supplemental Schedule VI 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS
Unaudited

NET CORPORATE DEBT, NET FLEET DEBT AND TOTAL NET DEBT
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2013
 
As of December 31, 2013
 
 
As of March 31, 2015
 
As of March 31, 2014
 
As Restated
 
As Reported
(In millions)
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
Debt
 
$
9,917

 
$
6,434

 
$
16,351

 
$
9,548

 
$
6,577

 
$
16,125

 
$
9,806

 
$
6,503

 
$
16,309

 
$
9,806

 
$
6,503

 
$
16,309

Less:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
 
—

 
585

 
585

 
—

 
498

 
498

 
—

 
411

 
411

 
—

 
423

 
423

Restricted cash
 
369

 
42

 
411

 
400

 
53

 
453

 
772

 
89

 
861

 
772

 
88

 
860

Net debt
 
$
9,548

 
$
5,807

 
$
15,355

 
$
9,148

 
$
6,026

 
$
15,174

 
$
9,034

 
$
6,003

 
$
15,037

 
$
9,034

 
$
5,992

 
$
15,026

 
WORLDWIDE EQUIPMENT RENTAL AND RENTAL RELATED REVENUE
 
 
Three Months Ended March 31,
(In millions)
 
2015
 
2014
 
2013
As Restated
 
2013
As Reported
Equipment rental segment revenues
 
$
355

 
$
358

 
$
353

 
$
351

Equipment sales and other revenue
 
(23
)
 
(26
)
 
(30
)
 
(30
)
Rental and rental related revenue at actual rates
 
332

 
332

 
323

 
321

Foreign currency adjustment (a)
 
4

 
2

 
(3
)
 
1

Rental and rental related revenue
 
$
336

 
$
334

 
$
320

 
$
322


(a)
Amounts shown for 2015 are based on December 31, 2014 foreign exchange rates. Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


10



Supplemental Schedule VI (continued)

HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH
 
U.S. Car Rental Segment
 
 
Three Months Ended March 31,
(In millions, except as noted)
 
2015
 
2014
 
2013
As Restated
Total RPD
 
 
 
 
 
 
Revenues
 
$
1,520

 
$
1,557

 
$
1,484

Advantage sublease revenue
 
—

 
—

 
(20
)
Ancillary retail car sales revenue
 
(12
)
 
(7
)
 
(2
)
Total rental revenue
 
$
1,508

 
$
1,550

 
$
1,462

Transaction days (in thousands)
 
32,036

 
32,360

 
30,064

Total RPD (in whole dollars)
 
$
47.07

 
$
47.90

 
$
48.63

Fleet Efficiency
 
 
 
 
 
 
Transaction days (in thousands)
 
32,036

 
32,360

 
30,064

Average Fleet
 
489,300

 
491,500

 
454,000

Advantage sublease vehicles
 
—

 
(11,000
)
 
(21,100
)
Hertz 24/7 vehicles
 
—

 
(1,000
)
 
(1,000
)
Average Fleet used to calculate fleet efficiency
 
489,300

 
479,500

 
431,900

Number of days in period
 
90

 
90

 
90

Average fleet multiplied by number of dates in period (in thousands)
 
44,037

 
43,155

 
38,871

Fleet efficiency
 
73
%
 
75
%
 
77
%
Net Depreciation Per Unit Per Month
 
 
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
421

 
$
424

 
$
285

Average fleet
 
489,300

 
491,500

 
454,000

Depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
860

 
$
863

 
$
628

Number of months in period
 
3

 
3

 
3

Net depreciation per unit per month (in whole dollars)
 
$
287

 
$
288

 
$
209

 

11



Supplemental Schedule VI (continued)
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH (continued)

International Car Rental
 
 
Three Months Ended March 31,
(in millions, except as noted)
 
2015
 
2014
 
2013
As Restated
Total RPD
 
 
 
 
 
 
Revenues
 
$
436

 
$
482

 
$
471

Foreign currency adjustment(a)
 
23

 
1

 
(6
)
Total rental revenue
 
$
459

 
$
483

 
$
465

Transaction days (in thousands)
 
9,775

 
9,395

 
9,006

Total RPD (in whole dollars)
 
$
46.96

 
$
51.41

 
$
51.63

Fleet Efficiency
 
 
 
 
 
 
Transaction days (in thousands)
 
9,775

 
9,395

 
9,006

Average Fleet
 
144,000

 
141,400

 
137,500

Number of days in period
 
90

 
90

 
90

Average fleet multiplied by number of days in period
 
12,960

 
12,726

 
12,375

Fleet efficiency
 
75
%
 
74
%
 
73
%
Net Depreciation Per Unit Per Month
 
 
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
95

 
$
113

 
$
125

Foreign currency adjustment (in millions)(a)
 
5

 
—

 
(1
)
Adjusted depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
100

 
$
113

 
$
124

Average fleet
 
144,000

 
141,400

 
137,500

Adjusted depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
694

 
$
799

 
$
902

Number of months in period
 
3

 
3

 
3

Net depreciation per unit per month (in whole dollars)
 
$
231

 
$
266

 
$
301

 
All Car Rental
 
 
Three Months
Ended March 31,
(In millions, except as noted)
2013
As Reported
 
 

Revenues
$
2,085

Non-rental revenue
(128
)
Foreign currency adjustment
2

Total rental revenue
$
1,959

Transaction days (in thousands)
39,070

Total RPD (in whole dollars)
$
50.14

(a)
Amounts shown for 2015 are based on December 31, 2014 foreign exchange rates. Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.

12



FINANCIAL INFORMATION AND OPERATING DATA
 
SELECTED UNAUDITED CONSOLIDATED INCOME STATEMENT DATA
 
 
Twelve Months Ended
December 31,
 
Twelve Months
Ended December
31,
(In millions, except per share data)
 
2014
 
2013
As Restated
 
2013
As Revised
Total revenues
 
$
11,046

 
$
10,775

 
$
10,772

Expenses:
 
 

 
 

 
 

Direct operating
 
6,314

 
5,777

 
5,752

Depreciation of revenue earning equipment and lease charges, net
 
3,034

 
2,533

 
2,526

Selling, general and administrative
 
1,088

 
1,053

 
1,022

Interest expense, net
 
648

 
707

 
704

Other income, net
 
(15
)
 
102

 
105

Total expenses
 
11,069

 
10,172

 
10,109

Income (loss) before income taxes
 
(23
)
 
603

 
663

(Provision) benefit for taxes on income (loss)
 
(59
)
 
(301
)
 
(317
)
Net income (loss)
 
$
(82
)
 
$
302

 
$
346

Weighted average number of shares outstanding:
 
 

 
 

 
 

Basic
 
454

 
422

 
422

Diluted
 
454

 
464

 
464

Earnings per share:
 
 

 
 

 
 

Basic
 
$
(0.18
)
 
$
0.72

 
$
0.82

Diluted
 
$
(0.18
)
 
$
0.67

 
$
0.76

Corporate EBITDA (a)
 
$
1,331

 
$
2,001

 
$
2,044

Adjusted pre-tax Income (loss) (a)
 
403

 
1,096

 
1,154


(a)        Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule III.
 
SELECTED UNAUDITED CONSOLIDATED BALANCE SHEET DATA
 
(In millions)
 
As of
December 31,
2014
 
As of
December 31,
2013
As Restated
 
As of
December 31,
2013
As Revised
Cash and cash equivalents
 
$
490

 
$
411

 
$
423

Restricted cash
 
571

 
861

 
860

Revenue earning equipment:
 
 

 
 

 
 

U.S. Car Rental
 
8,070

 
8,629

 
8,629

International Car Rental
 
1,904

 
2,047

 
2,047

Worldwide Equipment Rental
 
2,442

 
2,416

 
2,416

All Other Operations
 
1,237

 
1,099

 
1,101

Total revenue earning equipment, net
 
13,653

 
14,191

 
14,193

Total assets
 
23,985

 
24,423

 
24,588

Total debt
 
15,993

 
16,309

 
16,309

Net Fleet debt (a)
 
9,047

 
9,034

 
9,034

Net Corporate debt (a) (b)
 
5,885

 
6,003

 
5,992

Total equity
 
2,464

 
2,567

 
2,771


(a)    Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule VI.
(b)    Fleet related to Hertz Equipment Rental Corporation is funded via Corporate Debt.



13



SELECTED UNAUDITED CONSOLIDATED CASH FLOW DATA
 
 
Twelve Months Ended
December 31,
 
Twelve Months
Ended December 31,
(In millions)
 
2014
 
2013 As Restated
 
2013 As Reported
Cash provided by (used in):
 
 

 
 

 
 

Operating activities
 
$
3,452

 
$
3,593

 
$
3,590

Investing activities
 
(3,183
)
 
(3,850
)
 
(3,839
)
Financing activities
 
(159
)
 
127

 
127

Effect of exchange rate changes
 
(31
)
 
—

 
—

Net change in cash and cash equivalents
 
$
79

 
$
(130
)
 
$
(122
)
Fleet growth (a)
 
$
104

 
$
(449
)
 
$
(455
)
Free cash flow (a)
 
321

 
$
446

 
449


(a)
Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules IV and V.
 
SELECTED UNAUDITED OPERATING DATA BY SEGMENT
 
 
 
Twelve Months Ended
December 31,
 
Twelve Months
Ended December 31,
 
 
2014
 
2013
As Restated
 
2013
As Reported
U.S. Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
139,752

 
133,181

 
133,181

Total RPD (a)
 
$
46.07

 
$
46.94

 
$
47.00

Average fleet
 
499,100

 
490,000

 
490,000

Fleet efficiency(a)
 
77
%
 
78
%
 
NR

Net depreciation per unit per month(a)
 
$
294

 
$
218

 
NR

Program cars as a percentage of total average fleet at period end
 
21
%
 
9
%
 
NR

Adjusted pre-tax income (loss) (in millions) (a)
 
$
387

 
$
1,033

 
$
1,091

International Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
46,917

 
45,019

 
45,019

Total RPD (a)(b)
 
$
52.86

 
$
53.31

 
$
53.81

Average Fleet
 
166,900

 
161,300

 
161,300

Fleet efficiency(a)
 
77
%
 
76
%
 
NR

Net depreciation per unit per month(a)
 
$
250

 
$
275

 
NR

Program cars as a percentage of total average fleet at period end
 
30
%
 
24
%
 
NR

Adjusted pre-tax income (loss) (in millions) (a)
 
$
144

 
$
134

 
$
141

Worldwide Equipment Rental
 
 

 
 

 
 

Dollar utilization
 
36
%
 
37
%
 
NR

Time utilization
 
64
%
 
65
%
 
NR

Rental and rental related revenue (in millions) (a)(b)
 
$
1,468

 
$
1,400

 
$
1,415

Same store revenue growth, including growth initiatives (b)
 
5
%
 
10
%
 
10
%
Adjusted pre-tax income (loss) (in millions) (a)
 
$
258

 
$
301

 
$
292

All Other Operations
 
 

 
 

 
 

Average fleet — Donlen
 
172,800

 
169,600

 
169,600

Adjusted pre-tax income (loss) (in millions) (a)
 
$
62

 
$
58

 
$
57

(a)    Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules III and VI.
(b)     Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.

14



SUPPLEMENTAL SCHEDULES AND DEFINITIONS
 
The following Supplemental Schedules and definitions are provided to present segment results and reconciliations of non-GAAP measures to their most comparable GAAP measure. Following the Supplemental Schedules we provide definitions for terminology used throughout these schedules.
 
Supplemental Schedule I
HERTZ GLOBAL HOLDINGS, INC.    
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
 
Twelve Months Ended December 31, 2014
 
Twelve Months Ended December 31, 2013
As Restated
 
Twelve
Months
Ended
 December
31, 2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
Consolidated
HGH
Total revenues:
$
6,471

 
$
2,436

 
$
1,571

 
$
568

 
$
—

 
$
11,046

 
$
6,331

 
$
2,378

 
$
1,539

 
$
527

 
$
—

 
$
10,775

 
$
10,772

Expenses:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct operating
3,921

 
1,491

 
863

 
24

 
15

 
6,314

 
3,531

 
1,407

 
826

 
24

 
(11
)
 
5,777

 
5,752

Depreciation of revenue earning equipment and lease charges, net
1,758

 
492

 
329

 
455

 
—

 
3,034

 
1,281

 
528

 
299

 
425

 
—

 
2,533

 
2,526

Selling, general and administrative
380

 
259

 
161

 
30

 
258

 
1,088

 
429

 
267

 
131

 
27

 
199

 
1,053

 
1,022

Interest expense, net
172

 
95

 
53

 
12

 
316

 
648

 
187

 
113

 
46

 
14

 
347

 
707

 
704

Other (income) expense, net
(18
)
 
4

 
(5
)
 
1

 
3

 
(15
)
 
31

 
29

 
(4
)
 
1

 
45

 
102

 
105

Total expenses
6,213

 
2,341

 
1,401

 
522

 
592

 
11,069

 
5,459

 
2,344

 
1,298

 
491

 
580

 
10,172

 
10,109

Income (loss)before income taxes
$
258

 
$
95

 
$
170

 
$
46

 
$
(592
)
 
$
(23
)
 
$
872

 
$
34

 
$
241

 
$
36

 
$
(580
)
 
$
603

 
$
663

Provision for taxes on income
 

 
 

 
 

 
 

 
 

 
(59
)
 
 

 
 

 
 

 
 

 
 

 
(301
)
 
(317
)
Net income (loss)
 

 
 

 
 

 
 

 
 

 
$
(82
)
 
 

 
 

 
 

 
 

 
 

 
$
302

 
$
346


15



Supplemental Schedule II
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
 
Twelve Months Ended December 31, 2014
 
Twelve Months Ended December 31, 2013 As Restated
 
Twelve Months Ended December 31, 2013 As Reported
 
(In millions, except per share data)
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
Total revenues
$
11,046

 
$
—

 
$
11,046

 
$
10,775

 
$
—

 
$
10,775

 
$
10,772

 
$
—

 
$
10,772

 
Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Direct operating
6,314

 
(222
)
(a)
6,092

 
5,777

 
(198
)
(a)
5,579

 
5,752

 
(199
)
(a)
5,553

 
Depreciation of revenue earning equipment and lease charges, net
3,034

 
(8
)
(b)
3,026

 
2,533

 
(13
)
(b)
2,520

 
2,526

 
(12
)
(b)
2,514

 
Selling, general and administrative
1,088

 
(167
)
(c)
921

 
1,053

 
(109
)
(c)
944

 
1,022

 
(106
)
(c)
916

 
Interest expense, net
648

 
(53
)
(d)
595

 
707

 
(68
)
(d)
639

 
704

 
(68
)
(d)
636

 
Other (income) expense, net
(15
)
 
24

(e)
9

 
102

 
(105
)
(e)
(3
)
 
105

 
(105
)
(e)
—

 
Total expenses
11,069

 
(426
)
 
10,643

 
10,172

 
(493
)
 
9,679

 
10,109

 
(490
)
 
9,619

 
Income (loss) before income taxes
(23
)
 
426

 
403

 
603

 
493

 
1,096

 
663

 
490

 
1,153

 
(Provision) benefit for taxes on income (loss)
(59
)
 
(158
)
(f)
(217
)
 
(301
)
 
(173
)
(f)
(474
)
 
(317
)
 
(87
)
 
(404
)
(f)
Net income (loss)
$
(82
)
 
$
268

 
$
186

 
$
302

 
$
320

 
$
622

 
$
346

 
$
403

 
$
749

 
Weighted average number of diluted shares outstanding
454

 
454

 
454

 
464

 
464

 
464

 
464

 
464

 
464

 
Diluted earnings (loss) per share (g)
$
(0.18
)
 
$
0.59

 
$
0.41

 
$
0.67

 
$
0.69

 
$
1.36

 
$
0.76

 
$
0.87

 
$
1.63

 
a.
Primarily 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 twelve months ended December 31, 2014 and 2013, also includes restructuring and restructuring related charges of $92 million and $46 million, respectively.
b.
For the twelve months ended December 31, 2014 and 2013, represents the increase in depreciation of equipment rental revenue earning equipment based upon its revaluation relating to purchase accounting.
c.
For the twelve months ended December 31, 2014 and 2013, primarily comprised of restructuring and restructuring related charges of $100 million and $53 million, respectively, expenses associated with the anticipated HERC spin-off transaction announced in March 2014 of $39 million and zero, respectively, consulting costs and legal fees related to the accounting review and investigation, expenses associated with acquisitions, integration charges and relocation expenses associated with the Company's relocation of its headquarters to Estero, Florida.
d.
Represents debt-related charges relating to the amortization of deferred debt financing costs and debt discounts.
e.
Primarily represents amounts related to a $19 million litigation settlement in 2014. For 2013, primarily represents $40 of impairment charges and asset write-downs, $35 million of debt extinguishment loss and inducement costs, and $29 million of premiums paid and write-offs relating to European debt.Represents a provision for income taxes derived utilizing a normalized income tax rate (37% for 2014 and 35% for 2013).
f.
Represents a provision for income taxes derived using a normalized income tax rate (37% for 2014 and 35% for 2013).
g.
Net income (loss) used in diluted earnings per share calculation includes an adjustment to add back to net income the amount of interest expense on convertible senior notes, net of tax of $8 million, for the year ended December 31, 2013.

16



Supplemental Schedule III
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME TAXES
TO EBITDA, CORPORATE EBITDA AND ADJUSTED PRE-TAX INCOME BY SEGMENT
Unaudited 
 
Twelve Months Ended December 31, 2014
 
Twelve Months Ended December 31, 2013
As Restated
 
Twelve
Months
Ended
December 31,
2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
Consolidated
HGH
Income (loss) before income taxes
$
258

 
$
95

 
$
170

 
$
46

 
$
(592
)
 
$
(23
)
 
$
872

 
$
34

 
$
241

 
$
36

 
$
(580
)
 
$
603

 
$
663

Depreciation and amortization
1,976

 
533

 
404

 
465

 
22

 
3,400

 
1,489

 
564

 
373

 
436

 
10

 
2,872

 
2,853

Interest, net of interest income
172

 
95

 
53

 
12

 
316

 
648

 
187

 
113

 
46

 
14

 
347

 
707

 
704

EBITDA
$
2,406

 
$
723

 
$
627

 
$
523

 
$
(254
)
 
$
4,025

 
$
2,548

 
$
711

 
$
660

 
$
486

 
$
(223
)
 
$
4,182

 
$
4,220

Car rental fleet depreciation
(1,758
)
 
(492
)
 
—

 
(455
)
 
—

 
(2,705
)
 
(1,281
)
 
(528
)
 
—

 
(425
)
 
—

 
(2,234
)
 
(2,227
)
Car rental fleet interest
(178
)
 
(85
)
 
—

 
(14
)
 
—

 
(277
)
 
(186
)
 
(102
)
 
—

 
(14
)
 
—

 
(302
)
 
(302
)
Car rental fleet debt - related charges (a)
10

 
15

 
—

 
6

 
—

 
31

 
13

 
14

 
—

 
5

 
—

 
32

 
32

Non-cash stock-based employee compensation charges (b)
—

 
4

 
—

 
—

 
6

 
10

 
—

 
4

 
—

 
—

 
31

 
35

 
35

Restructuring and restructuring related charges (c)
55

 
25

 
7

 
—

 
78

 
165

 
26

 
35

 
10

 
—

 
28

 
99

 
99

Acquisition related costs and charges (d)
—

 
—

 
—

 
—

 
10

 
10

 
—

 
—

 
—

 
—

 
19

 
19

 
19

Integration expenses (d)
1

 
—

 
—

 
—

 
8

 
9

 
21

 
—

 
—

 
—

 
22

 
43

 
40

Equipment Rental spin-off costs (e)
—

 
—

 
28

 
—

 
11

 
39

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Relocation costs (f)
—

 
—

 
—

 
—

 
9

 
9

 
—

 
—

 
—

 
—

 
7

 
7

 
8

Premiums paid on debt (g)
—

 
—

 
—

 
—

 
—

 
—

 
—

 
29

 
—

 
—

 
—

 
29

 
29

Loss on extinguishment of debt (h)
—

 
—

 
—

 
—

 
1

 
1

 
—

 
—

 
—

 
—

 
35

 
35

 
—

Impairment charges and asset write-downs (i)
10

 
—

 
10

 
—

 
14

 
34

 
40

 
—

 
—

 
—

 
—

 
40

 
44

Other extraordinary, unusual or non-recurring items (j)
(21
)
 
(2
)
 
—

 
—

 
3

 
(20
)
 
(5
)
 
12

 
—

 
1

 
8

 
16

 
47

Corporate EBITDA
$
525

 
$
188

 
$
672

 
$
60

 
$
(114
)
 
$
1,331

 
$
1,176

 
$
175

 
$
670

 
$
53

 
$
(73
)
 
$
2,001

 
$
2,044

Non-fleet depreciation and amortization
(218
)
 
(41
)
 
(404
)
 
(10
)
 
(22
)
 
(695
)
 
(208
)
 
(36
)
 
(373
)
 
(11
)
 
(10
)
 
(638
)
 
(626
)
Non-fleet interest, net of interest income
6

 
(10
)
 
(53
)
 
2

 
(316
)
 
(371
)
 
(1
)
 
(11
)
 
(46
)
 
—

 
(347
)
 
(405
)
 
(402
)
Non-fleet debt - related charges (a)
2

 
—

 
5

 
—

 
15

 
22

 
1

 
—

 
5

 
1

 
29

 
36

 
36

Non-cash stock-based employee compensation charges
—

 
(4
)
 
—

 
—

 
(6
)
 
(10
)
 
—

 
(4
)
 
—

 
—

 
(31
)
 
(35
)
 
(35
)
Acquisition accounting (k)
72

 
11

 
38

 
10

 
1

 
132

 
65

 
10

 
40

 
15

 
2

 
132

 
132

Other (l)
—

 
—

 
—

 
—

 
(6
)
 
(6
)
 
—

 
—

 
5

 
—

 
—

 
5

 
5

Adjusted Pre-Tax Income (Loss)
$
387

 
$
144

 
$
258

 
$
62

 
$
(448
)
 
$
403

 
$
1,033

 
$
134

 
$
301

 
$
58

 
$
(430
)
 
$
1,096

 
$
1,154



17



(a)
Represents non-cash charges relating to the amortization of deferred debt financing costs and debt discounts.
(b)
For twelve months ended December 31, 2014, excludes $6 million of stock-based compensation forfeitures included in restructuring and restructuring related charges.
(c)
Represents expenses incurred under restructuring actions as defined by U.S. GAAP as well as transition costs incurred in connection with our business process outsourcing arrangements and incremental costs incurred to facilitate business process re-engineering initiatives that involve significant organization redesign and extensive operational process changes.  Amount in 2014 also includes consulting costs and legal fees related to the accounting review and investigation, one-time costs to terminate certain marketing and co-branding arrangements, and costs associated with the separation of certain executives during the year.
(d)
Primarily represents Dollar Thrifty integration related expenses.
(e)
Represents expense associated with the anticipated HERC spin-off transaction of which $28 million were incurred by HERC and $11 million were incurred by Corporate in 2014.
(f)
Represents non-recurring costs incurred in connection with the relocation of our corporate headquarters to Estero, Florida that were not included in restructuring expenses.  Such expenses primarily include duplicate facility rent, certain moving expenses, and other costs that are direct and incremental due to the relocation.
(g)
In 2013, represents premiums paid to redeem our 8.50% Former European Fleet Notes.
(h)
In 2013, represents extinguishment of debt for Senior Convertible Notes.
(i)
For 2014, primarily comprised of impairments related to our former corporate headquarters building in New Jersey and HERC revenue earning equipment held for sale. Additionally, 2014 includes write-downs of assets associated with a terminated business relationship. In 2013, primarily related to a change in the carrying value of the vehicles subleased to FSNA and its former subsidiary, Simply Wheelz.
(j)
In 2014, primarily comprised of a $19 million litigation settlement received in relation to a class action lawsuit filed against an original equipment manufacturer.  In 2013, primarily represents cash premiums of $12 million associated with the conversion of the Senior Convertible Notes.
(k)
Represents the increase in amortization of other intangible assets, depreciation of property and equipment and accretion of revalued liabilities relating to acquisition accounting.
(l)
In 2014, represents $6 million of stock-based compensation forfeitures included in restructuring and restructuring related charges.  In 2013, represents $5 million of depreciation expense related to HERC.

18



Supplemental Schedule IV
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FREE CASH FLOW
Unaudited
 
 
 
Twelve Months Ended
December 31,
 
Twelve
Months Ended
December 31,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Revised
Income before income taxes
 
$
(23
)
 
$
603

 
$
663

Depreciation and amortization, non-fleet assets
 
366

 
339

 
205

Amortization of debt discount and related charges
 
46

 
68

 
190

Cash paid for income taxes
 
(64
)
 
(71
)
 
(71
)
Changes in assets and liabilities, net of effects of acquisitions, and other
 
173

 
202

 
157

Net cash provided by operating activities excluding depreciation of revenue earning equipment
 
498

 
1,141

 
1,144

U.S. car rental fleet growth (a)
 
260

 
(500
)
 
(511
)
International car rental fleet growth (a)
 
(61
)
 
243

 
247

Equipment rental fleet growth (a)
 
(103
)
 
(235
)
 
(234
)
All other operations rental fleet growth (a)
 
8

 
43

 
43

Property and equipment expenditures, net of disposals
 
(281
)
 
(246
)
 
(241
)
Net investment activity
 
(177
)
 
(695
)
 
(696
)
Free cash flow
 
$
321

 
$
446

 
$
449


(a)         Historically, fleet growth has not been reported on a segment basis.

19



Supplemental Schedule V
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FLEET GROWTH
Unaudited
 
 
Twelve Months Ended December 31, 2014
 
Twelve Months Ended December 31, 2013
As Restated
 
Twelve
Months
Ended
December
31, 2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
Consolidated
HGH
Revenue earning equipment expenditures
$
(5,965
)
 
$
(3,103
)
 
$
(615
)
 
$
(1,606
)
 
$
(11,289
)
 
$
(6,015
)
 
$
(2,593
)
 
$
(672
)
 
$
(1,009
)
 
$
(10,289
)
 
$
(10,298
)
Proceeds from disposal of revenue earning equipment
4,507

 
2,510

 
182

 
1,010

 
8,209

 
4,320

 
2,242

 
138

 
556

 
7,256

 
7,264

Net revenue earning equipment capital expenditures
(1,458
)
 
(593
)
 
(433
)
 
(596
)
 
(3,080
)
 
(1,695
)
 
(351
)
 
(534
)
 
(453
)
 
(3,033
)
 
(3,034
)
Depreciation of revenue earning equipment
1,758

 
412

 
330

 
455

 
2,955

 
1,279

 
447

 
299

 
425

 
2,450

 
2,445

Financing activity related to car rental fleet:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Borrowings
2,702

 
1,181

 
—

 
511

 
4,394

 
5,600

 
2,019

 
—

 
1,531

 
9,150

 
NR

Payments
(3,012
)
 
(1,051
)
 
—

 
(350
)
 
(4,413
)
 
(5,432
)
 
(1,884
)
 
—

 
(1,444
)
 
(8,760
)
 
NR

Restricted cash changes
270

 
(10
)
 
—

 
(12
)
 
248

 
(252
)
 
12

 
—

 
(16
)
 
(256
)
 
NR

Net financing activity related to car rental fleet
(40
)
 
120

 
—

 
149

 
229

 
(84
)
 
147

 
—

 
71

 
134

 
134

Fleet growth
$
260

 
$
(61
)
 
$
(103
)
 
$
8

 
$
104

 
$
(500
)
 
$
243

 
$
(235
)
 
$
43

 
$
(449
)
 
$
(455
)

20



Supplemental Schedule VI
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS
Unaudited
 
NET CORPORATE DEBT, NET FLEET DEBT AND TOTAL NET DEBT
 
 
 
 
 
 
 
 
 
As of December 31, 2013
 
As of December 31, 2013
 
 
As of December 31, 2014
 
As Restated
 
As Revised
(In millions)
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
Debt
 
$
9,562

 
$
6,431

 
$
15,993

 
$
9,806

 
$
6,503

 
$
16,309

 
$
9,806

 
$
6,503

 
$
16,309

Less:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
 
—

 
490

 
490

 
—

 
411

 
411

 
—

 
423

 
423

Restricted cash
 
515

 
56

 
571

 
772

 
89

 
861

 
772

 
88

 
860

Net debt
 
$
9,047

 
$
5,885

 
$
14,932

 
$
9,034

 
$
6,003

 
$
15,037

 
$
9,034

 
$
5,992

 
$
15,026

 
WORLDWIDE EQUIPMENT RENTAL AND RENTAL RELATED REVENUE
 
 
 
Twelve Months
Ended December 31,
 
Twelve
Months
Ended
December 31,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Reported
Equipment rental segment revenues
 
$
1,571

 
$
1,539

 
$
1,538

Equipment sales and other revenue
 
(115
)
 
(132
)
 
(132
)
Rental and rental related revenue at actual rates
 
1,456

 
1,407

 
1,406

Foreign currency adjustment(a)
 
12

 
(7
)
 
9

Rental and rental related revenue
 
$
1,468

 
$
1,400

 
$
1,415


(a)         Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


21



Supplemental Schedule VI
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH
 
U.S. Car Rental Segment
 
 
Twelve Months
Ended December 31,
 
Twelve
Months Ended
December 31,
(In millions, except as noted)
 
2014
 
2013
As Restated
 
2013
As Reported
Total RPD
 
 
 
 
 
 
Revenues
 
$
6,471

 
$
6,331

 
$
6,324

Advantage sublease revenue
 
—

 
(65
)
 
(65
)
Ancillary retail car sales revenue
 
(32
)
 
(14
)
 
—

Total rental revenue
 
$
6,439

 
$
6,252

 
$
6,259

Transaction days (in thousands)
 
139,752

 
133,181

 
133,181

Total RPD (in whole dollars)
 
$
46.07

 
$
46.94

 
$
47.00

Fleet Efficiency
 
 
 
 
 
 
Transaction days (in thousands)
 
139,752

 
133,181

 
 

Average Fleet
 
499,100

 
490,000

 
 

Advantage sublease vehicles
 
(4,000
)
 
(21,000
)
 
 

Hertz 24/7 vehicles
 
(1,000
)
 
(2,000
)
 
 

Average Fleet used to calculate fleet efficiency
 
494,100

 
467,000

 
 

Number of days in period
 
365

 
365

 
 

Average fleet multiplied by number of days in period (in thousands)
 
180,347

 
170,455

 
 

Fleet efficiency
 
77
%
 
78
%
 
 

Net Depreciation Per Unit Per Month
 
 
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
1,758

 
$
1,281

 
 

Average fleet
 
499,100

 
490,000

 
 

Adjusted depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
3,522

 
$
2,614

 
 

Number of months in period
 
12

 
12

 
 

Net depreciation per unit per month (in whole dollars)
 
$
294

 
$
218

 
 

 

22



International Car Rental
 
 
Twelve Months Ended
December 31,
 
Twelve
Months Ended
December 31,
(in millions, except as noted)
 
2014
 
2013
As Restated
 
2013
As Reported
Total RPD
 
 
 
 
 
 
Revenues
 
$
2,436

 
$
2,378

 
$
2,383

Foreign currency adjustment (a)
 
44

 
22

 
40

Total rental revenue
 
$
2,480

 
$
2,400

 
$
2,423

Transaction days (in thousands)
 
46,917

 
45,019

 
45,019

Total RPD (in whole dollars)
 
$
52.86

 
$
53.31

 
$
53.81

Fleet Efficiency
 
 
 
 
 
 
Transaction days (in thousands)
 
46,917

 
45,019

 
 

Average Fleet
 
166,900

 
161,300

 
 

Number of days in period
 
365

 
365

 
 

Average fleet multiplied by number of days in period
 
60,919

 
58,875

 
 

Fleet efficiency
 
77
%
 
76
%
 
 

Net Depreciation Per Unit Per Month
 
 
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
492

 
$
528

 
 

Foreign currency adjustment (in millions) (a) 
 
9

 
4

 
 

Adjusted depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
501

 
$
532

 
 

Average fleet
 
166,900

 
161,300

 
 

Adjusted depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
3,002

 
$
3,298

 
 

Number of months in period
 
12

 
12

 
 

Net depreciation per unit per month (in whole dollars)
 
$
250

 
$
275

 
 


(a)
Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.

23



FINANCIAL INFORMATION AND OPERATING DATA
 
SELECTED UNAUDITED CONSOLIDATED INCOME STATEMENT DATA
 
 
Three Months Ended
December 31,
 
Three Months Ended December 31,
(In millions, except per share data)
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Total revenues
 
$
2,559

 
$
2,555

 
$
2,556

 
$
2,556

Expenses:
 
 

 
 

 
 

 
 

Direct operating
 
1,575

 
1,449

 
1,439

 
1,439

Depreciation of revenue earning equipment and lease charges, net
 
853

 
641

 
643

 
643

Selling, general and administrative
 
245

 
234

 
222

 
222

Interest expense, net
 
164

 
171

 
169

 
169

Other income, net
 
6

 
21

 
21

 
21

Total expenses
 
2,843

 
2,516

 
2,494

 
2,494

Income (loss) before income taxes
 
(284
)
 
39

 
62

 
62

(Provision) benefit for taxes on income (loss)
 
50

 
(57
)
 
(63
)
 
(63
)
Net income (loss)
 
$
(234
)
 
$
(18
)
 
$
(1
)
 
$
(1
)
Weighted average number of shares outstanding:
 
 

 
 

 
 

 
 

Basic
 
459

 
447

 
447

 
447

Diluted
 
459

 
447

 
464

 
464

Earnings per share:
 
 

 
 

 
 

 
 

Basic
 
$
(0.51
)
 
$
(0.04
)
 
$
—

 
$
—

Diluted
 
$
(0.51
)
 
$
(0.04
)
 
$
—

 
$
—

Corporate EBITDA (a)
 
$
76

 
$
388

 
NR

 
$
406

Adjusted pre-tax Income (loss) (a)
 
(161
)
 
157

 
NR

 
186


(a)
Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule III.
 
SELECTED UNAUDITED CONSOLIDATED BALANCE SHEET DATA
(In millions)
 
As of
December 31,
2014
 
As of
December 31,
2013
As Restated
 
As of
December 31,
2013
As Revised
Cash and cash equivalents
 
$
490

 
$
411

 
$
423

Restricted cash
 
571

 
861

 
860

Revenue earning equipment:
 
 

 
 

 
 

U.S. Car Rental
 
8,070

 
8,629

 
8,629

International Car Rental
 
1,904

 
2,047

 
2,047

Worldwide Equipment Rental
 
2,442

 
2,416

 
2,416

All Other Operations
 
1,237

 
1,099

 
1,101

Total revenue earning equipment, net
 
13,653

 
14,191

 
14,193

Total assets
 
23,985

 
24,423

 
24,588

Total debt
 
15,993

 
16,309

 
16,309

Net Fleet debt (a)
 
9,047

 
9,034

 
9,034

Net Corporate debt (a) (b)
 
5,885

 
6,003

 
5,992

Total equity
 
2,464

 
2,567

 
2,771


(a)         Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule VI.
(b)         Fleet related to Hertz Equipment Rental Corporation is funded via Corporate Debt.



24



SELECTED UNAUDITED CONSOLIDATED CASH FLOW DATA
 
 
Twelve Months Ended
December 31,
 
Twelve Months
Ended December
31,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Revised
Cash provided by (used in):
 
 

 
 

 
 

Operating activities
 
$
3,452

 
$
3,593

 
$
3,590

Investing activities
 
(3,183
)
 
(3,850
)
 
(3,839
)
Financing activities
 
(159
)
 
127

 
127

Effect of exchange rate changes
 
(31
)
 
—

 
—

Net change in cash and cash equivalents
 
$
79

 
$
(130
)
 
$
(122
)
Fleet growth (a)
 
$
104

 
$
(449
)
 
$
(455
)
Free cash flow (a)
 
321

 
446

 
449


(a)
Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules IV and V.
 
SELECTED UNAUDITED OPERATING DATA BY SEGMENT
 
 
Three Months Ended December 31,
 
Three Months
Ended December
31,
 
 
2014
 
2013
As Restated
 
2013
As Reported
U.S. Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
33,595

 
32,875

 
32,875

Total RPD (a)
 
$
43.85

 
$
44.75

 
$
44.91

Average fleet
 
486,900

 
490,200

 
490,200

Fleet efficiency(a)
 
75
%
 
76
%
 
NR

Net depreciation per unit per month(a)
 
$
365

 
$
229

 
NR

Program cars as a percentage of total average fleet at period end
 
21
%
 
9
%
 
NR

Adjusted pre-tax income (loss) (in millions) (a)
 
$
(126
)
 
$
132

 
$
170

International Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
10,734

 
10,473

 
10,473

Total RPD (a)(b)
 
$
51.70

 
$
51.85

 
$
52.49

Average Fleet
 
156,700

 
155,700

 
155,700

Fleet efficiency(a)
 
74
%
 
73
%
 
NR

Net depreciation per unit per month(a)
 
$
225

 
$
225

 
NR

Program cars as a percentage of total average fleet at period end
 
30
%
 
24
%
 
NR

Adjusted pre-tax income (loss) (in millions) (a)
 
$
(12
)
 
$
21

 
$
15

Worldwide Equipment Rental
 
 

 
 

 
 

Dollar utilization
 
38
%
 
38
%
 
NR

Time utilization
 
67
%
 
66
%
 
NR

Rental and rental related revenue (in millions) (a)(b)
 
$
394

 
$
366

 
$
370

Same store revenue growth, including growth initiatives (a)(b)
 
5
%
 
5
%
 
5
%
Adjusted pre-tax income (loss) (in millions) (a)
 
$
60

 
$
93

 
$
85

All Other Operations
 
 

 
 

 
 

Average fleet — Donlen
 
166,800

 
173,800

 
173,800

Adjusted pre-tax income (loss) (in millions) (a)
 
$
15

 
$
16

 
$
15


(a)         Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules III and VI.
(b)         Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


25



SUPPLEMENTAL SCHEDULES AND DEFINITIONS
 
The following Supplemental Schedules and definitions are provided to present segment results and reconciliations of non-GAAP measures to their most comparable GAAP measure. Following the Supplemental Schedules we provide definitions for terminology used throughout these schedules.

Supplemental Schedule I
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited

 
Three Months Ended December 31, 2014
 
Three Months Ended December 31, 2013
As Restated
 
Three Months
Ended December 31, 2013
(In millions)
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
 HGH
 
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
As Revised
Consolidated
HGH
 
As Reported
Consolidated
HGH
Total revenues:
$
1,482

 
$
518

 
$
416

 
$
143

 
$
—

 
$
2,559

 
$
1,475

 
$
544

 
$
401

 
$
135

 
$
—

 
$
2,555

 
$
2,556

 
$
2,556

Expenses:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct operating
982

 
342

 
232

 
6

 
13

 
1,575

 
888

 
337

 
214

 
6

 
4

 
1,449

 
1,439

 
1,439

Depreciation of revenue earning equipment and lease charges,net
533

 
112

 
94

 
114

 
—

 
853

 
337

 
119

 
76

 
109

 
—

 
641

 
643

 
643

Selling, general and administrative
71

 
62

 
47

 
7

 
58

 
245

 
101

 
60

 
33

 
6

 
34

 
234

 
222

 
222

Interest expense, net
47

 
22

 
15

 
3

 
77

 
164

 
49

 
28

 
9

 
3

 
82

 
171

 
169

 
169

Other (income) expense, net
13

 
2

 
(2
)
 
1

 
(8
)
 
6

 
(12
)
 
29

 
(1
)
 
2

 
3

 
21

 
21

 
21

Total expenses
1,646

 
540

 
386

 
131

 
140

 
2,843

 
1,363

 
573

 
331

 
126

 
123

 
2,516

 
2,494

 
2,494

Income (loss)before income taxes
$
(164
)
 
$
(22
)
 
$
30

 
$
12

 
$
(140
)
 
$
(284
)
 
$
112

 
$
(29
)
 
$
70

 
$
9

 
$
(123
)
 
$
39

 
$
62

 
$
62

Provision for taxes on income
 

 
 

 
 

 
 

 
 

 
50

 
 

 
 

 
 

 
 

 
 

 
(57
)
 
(63
)
 
(63
)
Net income (loss)
 

 
 

 
 

 
 

 
 

 
$
(234
)
 
 

 
 

 
 

 
 

 
 

 
$
(18
)
 
$
(1
)
 
$
(1
)

26



Supplemental Schedule II
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
 
Three Months Ended December 31, 2014
 
Three Months Ended December 31, 2013 As Restated
 
Three Months Ended December 31, 2013 As Reported
 
(In millions, except per share data)
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjust-ments
 
Adjusted
(Non-GAAP)
 
Total revenues
$
2,559

 
$
—

 
$
2,559

 
$
2,555

 
$
—

 
$
2,555

 
$
2,556

 
$
—

 
$
2,556

 
Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Direct operating
1,575

 
(56
)
 
1,519

 
1,449

 
(60
)
 
1,389

 
1,439

 
(62
)
 
1,377

 
Depreciation of revenue earning equipment and lease charges, net
853

 
—

 
853

 
641

 
(4
)
 
637

 
643

 
(4
)
 
639

 
Selling, general and administrative
245

 
(52
)
 
193

 
234

 
(20
)
 
214

 
222

 
(21
)
 
201

 
Interest expense, net
164

 
(14
)
 
150

 
171

 
(15
)
 
156

 
169

 
(14
)
 
155

 
Other (income) expense, net
6

 
(1
)
 
5

 
21

 
(19
)
 
2

 
21

 
(23
)
 
(2
)
 
Total expenses
2,843

 
(123
)
 
2,720

 
2,516

 
(118
)
 
2,398

 
2,494

 
(124
)
 
2,370

 
Income (loss) before income taxes
(284
)
 
123

 
(161
)
 
39

 
118

 
157

 
62

 
124

 
186

 
(Provision) benefit for taxes on income (loss)
50

 
(46
)
(a)
4

 
(57
)
 
(41
)
(a)
(98
)
 
(63
)
 
(2
)
 
(65
)
(a)
Net income (loss)
$
(234
)
 
$
77

 
$
(157
)
 
$
(18
)
 
$
77

 
$
59

 
$
(1
)
 
$
122

 
$
121

 
Weighted average number of diluted shares outstanding
459

 
459

 
459

 
447

 
447

 
447

 
464

 
464

 
464

 
Diluted earnings (loss) per share
$
(0.51
)
 
$
0.17

 
$
(0.34
)
 
$
(0.04
)
 
$
0.17

 
$
0.13

 
$
—

 
$
0.26

 
$
0.26

 
a.
Represents a provision for income taxes derived utilizing a normalized income tax rate (37% for 2014 and 35% for 2013).



27



Supplemental Schedule III
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME TAXES
TO EBITDA, CORPORATE EBITDA AND ADJUSTED PRE-TAX INCOME BY SEGMENT
Unaudited

 
Three Months Ended December 31, 2014
 
Three Months Ended December 31, 2013
As Restated
 
Three Months
Ended December
31, 2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
 HGH
 
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
Consolidated
 HGH
Income (loss) before income taxes
$
(164
)
 
$
(22
)
 
$
30

 
$
12

 
$
(140
)
 
$
(284
)
 
$
112

 
$
(29
)
 
$
70

 
$
9

 
$
(123
)
 
$
39

 
$
62

Depreciation and amortization
588

 
122

 
113

 
117

 
7

 
947

 
392

 
131

 
94

 
111

 
3

 
731

 
729

Interest, net of interest income
47

 
22

 
15

 
3

 
77

 
164

 
49

 
28

 
9

 
3

 
82

 
171

 
169

EBITDA
$
471

 
$
122

 
$
158

 
$
132

 
$
(56
)
 
$
827

 
$
553

 
$
130

 
$
173

 
$
123

 
$
(38
)
 
$
941

 
$
960

Car rental fleet depreciation
(533
)
 
(112
)
 
—

 
(114
)
 
—

 
(759
)
 
(337
)
 
(119
)
 
—

 
(109
)
 
—

 
(565
)
 
(567
)
Car rental fleet interest
(49
)
 
(20
)
 
—

 
(3
)
 
—

 
(72
)
 
(51
)
 
(25
)
 
—

 
(3
)
 
—

 
(79
)
 
(79
)
Car rental fleet debt - related charges (a)
5

 
3

 
—

 
1

 
—

 
9

 
8

 
4

 
—

 
1

 
—

 
13

 
13

Non-cash stock-based employee compensation charges (b)
—

 
4

 
—

 
—

 
(14
)
 
(10
)
 
—

 
4

 
—

 
—

 
2

 
6

 
4

Restructuring and restructuring related charges (c)
12

 
3

 
—

 
—

 
24

 
39

 
5

 
9

 
8

 
—

 
4

 
26

 
27

Acquisition related costs and charges (d)
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
5

 
5

 
5

Integration expenses (d)
—

 
—

 
—

 
—

 
1

 
1

 
9

 
—

 
—

 
—

 
5

 
14

 
11

Equipment Rental spin-off costs (e)
—

 
—

 
11

 
—

 
1

 
12

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Relocation costs (f)
—

 
—

 
—

 
—

 
2

 
2

 
(1
)
 
—

 
—

 
—

 
3

 
2

 
3

Premiums paid on debt (g)
—

 
—

 
—

 
—

 
—

 
—

 
—

 
29

 
—

 
—

 
—

 
29

 
29

Loss on extinguishment of debt (h)
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
7

 
7

 
—

Impairment charges and asset write-downs (i)
—

 
—

 
10

 
—

 
14

 
24

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Other extraordinary, unusual or non-recurring items
—

 
1

 
(1
)
 
—

 
3

 
3

 
(13
)
 
5

 
—

 
2

 
(5
)
 
(11
)
 
—

Corporate EBITDA
$
(94
)
 
$
1

 
$
178

 
$
16

 
$
(25
)
 
$
76

 
$
173

 
$
37

 
$
181

 
$
14

 
$
(17
)
 
$
388

 
$
406

Non-fleet depreciation and amortization
(55
)
 
(10
)
 
(113
)
 
(3
)
 
(7
)
 
(188
)
 
(55
)
 
(12
)
 
(94
)
 
(2
)
 
(3
)
 
(166
)
 
(162
)
Non-fleet interest, net of interest income
2

 
(2
)
 
(15
)
 
—

 
(77
)
 
(92
)
 
2

 
(3
)
 
(9
)
 
—

 
(82
)
 
(92
)
 
(90
)
Non-fleet debt - related charges (a)
1

 
—

 
1

 
—

 
3

 
5

 
—

 
—

 
2

 
1

 
(1
)
 
2

 
1

Non-cash stock-based employee compensation charges
—

 
(4
)
 
—

 
—

 
14

 
10

 
—

 
(4
)
 
—

 
—

 
(2
)
 
(6
)
 
(4
)
Acquisition accounting (j)
20

 
3

 
9

 
2

 
—

 
34

 
12

 
3

 
10

 
3

 
—

 
28

 
33

Other
—

 
—

 
—

 
—

 
(6
)
 
(6
)
 
—

 
—

 
3

 
—

 
—

 
3

 
2

Adjusted Pre-Tax Income (Loss)
$
(126
)
 
$
(12
)
 
$
60

 
$
15

 
$
(98
)
 
$
(161
)
 
$
132

 
$
21

 
$
93

 
$
16

 
$
(105
)
 
$
157

 
$
186


28



Supplemental Schedule IV
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FREE CASH FLOW
Unaudited
 
 
 
Twelve Months Ended
December 31,
 
Twelve
Months Ended
December 31,
(In millions)
 
2,014
 
2013
As Restated
 
2013
As Revised
Income before income taxes
 
$
(23
)
 
$
603

 
$
663

Depreciation and amortization, non-fleet assets
 
366

 
339

 
206

Amortization of debt discount and related charges
 
46

 
68

 
190

Cash paid for income taxes
 
(64
)
 
(71
)
 
(71
)
Changes in assets and liabilities, net of effects of acquisitions, and other
 
173

 
202

 
157

Net cash provided by operating activities excluding depreciation of revenue earning equipment
 
498

 
1,141

 
1,145

U.S. car rental fleet growth (a)
 
260

 
(500
)
 
(511
)
International car rental fleet growth (a)
 
(61
)
 
243

 
247

Equipment rental fleet growth (a)
 
(103
)
 
(235
)
 
(234
)
All other operations rental fleet growth (a)
 
8

 
43

 
43

Property and equipment expenditures, net of disposals
 
(281
)
 
(246
)
 
(241
)
Net investment activity
 
(177
)
 
(695
)
 
(696
)
Free cash flow
 
$
321

 
$
446

 
$
449

 

(a)  Historically, fleet growth has not been reported on a segment basis.

29



Supplemental Schedule V
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FLEET GROWTH
Unaudited
 
 
Twelve Months Ended December 31, 2014
 
Twelve Months Ended December 31, 2013
As Restated
 
Twelve Months
Ended December
31, 2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
Consolidated HGH
Revenue earning equipment expenditures
$
(5,965
)
 
$
(3,103
)
 
$
(615
)
 
$
(1,606
)
 
$
(11,289
)
 
$
(6,015
)
 
$
(2,593
)
 
$
(672
)
 
$
(1,009
)
 
$
(10,289
)
 
$
(10,298
)
Proceeds from disposal of revenue earning equipment
4,507

 
2,510

 
182

 
1,010

 
8,209

 
4,320

 
2,242

 
138

 
556

 
7,256

 
7,264

Net revenue earning equipment capital expenditures
(1,458
)
 
(593
)
 
(433
)
 
(596
)
 
(3,080
)
 
(1,695
)
 
(351
)
 
(534
)
 
(453
)
 
(3,033
)
 
(3,034
)
Depreciation of revenue earning equipment
1,758

 
412

 
330

 
455

 
2,955

 
1,279

 
447

 
299

 
425

 
2,450

 
2,445

Financing activity related to car rental fleet:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Borrowings
2,702

 
1,181

 
—

 
511

 
4,394

 
5,600

 
2,019

 
—

 
1,531

 
9,150

 
NR

Payments
(3,012
)
 
(1,051
)
 
—

 
(350
)
 
(4,413
)
 
(5,432
)
 
(1,884
)
 
—

 
(1,444
)
 
(8,760
)
 
NR

Restricted cash changes
270

 
(10
)
 
—

 
(12
)
 
248

 
(252
)
 
12

 
—

 
(16
)
 
(256
)
 
NR

Net financing activity related to car rental fleet
(40
)
 
120

 
—

 
149

 
229

 
(84
)
 
147

 
—

 
71

 
134

 
134

Fleet growth
$
260

 
$
(61
)
 
$
(103
)
 
$
8

 
$
104

 
$
(500
)
 
$
243

 
$
(235
)
 
$
43

 
$
(449
)
 
$
(455
)

30



Supplemental Schedule VI

HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS
Unaudited
 
NET CORPORATE DEBT, NET FLEET DEBT AND TOTAL NET DEBT
 
 
 
 
 
 
 
 
As of December 31, 2013
 
As of December 31, 2013
 
As of December 31, 2014
 
As Restated
 
As Revised
(In millions)
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
Debt
$
9,562

 
$
6,431

 
$
15,993

 
$
9,806

 
$
6,503

 
$
16,309

 
$
9,806

 
$
6,503

 
$
16,309

Less:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
—

 
490

 
490

 
—

 
411

 
411

 
—

 
423

 
423

Restricted cash
515

 
56

 
571

 
772

 
89

 
861

 
772

 
88

 
860

Net debt
$
9,047

 
$
5,885

 
$
14,932

 
$
9,034

 
$
6,003

 
$
15,037

 
$
9,034

 
$
5,992

 
$
15,026

 
WORLDWIDE EQUIPMENT RENTAL AND RENTAL RELATED REVENUE
 
 
 
Three Months
Ended December 31,
 
Three
Months
Ended
December 31,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Revised
Equipment rental segment revenues
 
$
416

 
$
401

 
$
401

Equipment sales and other revenue
 
(28
)
 
(34
)
 
(34
)
Rental and rental related revenue at actual rates
 
388

 
367

 
367

Foreign currency adjustment (a)
 
6

 
(1
)
 
3

Rental and rental related revenue
 
$
394

 
$
366

 
$
370


(a)
Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


31



Supplemental Schedule VI (continued)
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH
 
U.S. Car Rental Segment
 
 
 
Three Months
Ended December 31,
 
Three Months Ended
December 31,
(In millions, except as noted)
 
2014
 
2013
As Restated
 
2013
As Reported
Total RPD
 
 
 
 
 
 
Revenues
 
$
1,482

 
$
1,475

 
$
1,476

Advantage sublease revenue
 
—

 
—

 
—

Ancillary retail car sales revenue
 
(9
)
 
(4
)
 
—

Total rental revenue
 
$
1,473

 
$
1,471

 
$
1,476

Transaction days (in thousands)
 
33,595

 
32,875

 
32,875

Total RPD (in whole dollars)
 
$
43.85

 
$
44.75

 
$
44.91

Fleet Efficiency
 
 
 
 
 
 
Transaction days (in thousands)
 
33,595

 
32,875

 
 

Average Fleet
 
486,900

 
490,200

 
 

Advantage sublease vehicles
 
—

 
(18,000
)
 
 

Hertz 24/7 vehicles
 
—

 
(2,000
)
 
 

Average Fleet used to calculate fleet efficiency
 
486,900

 
470,200

 
 

Number of days in period
 
92

 
92

 
 

Average fleet multiplied by number of days in period (in thousands)
 
$
44,795

 
$
43,258

 
 

Fleet efficiency
 
75
%
 
76
%
 
 

Net Depreciation Per Unit Per Month
 
 
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
533

 
$
337

 
 

Average fleet
 
486,900

 
490,200

 
 

Adjusted depreciation of revenue earning equipment and lease charges, net divided by average fleet
 
$
1,095

 
$
687

 
 

Number of months in period
 
3

 
3

 
 

Net depreciation per unit per month
 
$
365

 
$
229

 
 

 

32



Supplemental Schedule VI (continued)
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED

TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH (continued)

International Car Rental
 
 
 
Three Months Ended
December 31,
 
Three Months Ended
December 31,
(in millions, except as noted)
 
2014
 
2013
As Restated
 
2013
As Reported
Total RPD
 
 
 
 
 
 
Revenues
 
$
518

 
$
544

 
$
544

Foreign currency adjustment (a)
 
37

 
(1
)
 
6

Total rental revenue
 
$
555

 
$
543

 
$
550

Transaction days (in thousands)
 
10,734

 
10,473

 
10,473

Total RPD (in whole dollars)
 
$
51.70

 
$
51.85

 
$
52.49

Fleet Efficiency
 
 
 
 
 
 
Transaction days (in thousands)
 
10,734

 
10,473

 
 

Average Fleet
 
156,700

 
155,700

 
 

Number of days in period
 
92

 
92

 
 

Average fleet multiplied by number of days in period
 
14,416

 
14,324

 
 

Fleet efficiency
 
74
%
 
73
%
 
 

Net Depreciation Per Unit Per Month
 
 
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
112

 
$
119

 
 

Foreign currency adjustment (in millions) (a) 
 
8

 
—

 
 

Adjusted depreciation of revenue earning equipment and lease charges, net (in millions)
 
$
120

 
$
119

 
 

Average fleet
 
156,700

 
155,700

 
 

Adjusted depreciation of revenue earning equipment and lease charges, net divided by average fleet
 
$
766

 
$
764

 
 

Number of months in period
 
3

 
3

 
 

Net depreciation per unit per month
 
$
255

 
$
255

 
 


(a)        Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


33



FINANCIAL INFORMATION AND OPERATING DATA

SELECTED UNAUDITED CONSOLIDATED INCOME STATEMENT DATA
 
 
Three Months Ended  September 30,
 
Three Months Ended  September 30,
(In millions, except per share data)
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Total revenues
 
$
3,121

 
$
3,075

 
$
3,070

 
$
3,070

Expenses:
 
 

 
 

 
 

 
 

Direct operating
 
1,702

 
1,547

 
1,540

 
1,525

Depreciation of revenue earning equipment and lease charges, net
 
746

 
672

 
675

 
677

Selling, general and administrative
 
303

 
282

 
272

 
278

Interest expense, net
 
164

 
179

 
179

 
179

Other income, net
 
3

 
83

 
83

 
83

Total expenses
 
2,918

 
2,763

 
2,749

 
2,742

Income (loss) before income taxes
 
203

 
312

 
321

 
328

(Provision) benefit for taxes on income (loss)
 
(54
)
 
(110
)
 
(111
)
 
(113
)
Net income (loss)
 
$
149

 
$
202

 
$
210

 
$
215

Weighted average number of shares outstanding:
 
 

 
 

 
 

 
 

Basic
 
459

 
425

 
425

 
425

Diluted
 
464

 
465

 
465

 
465

Earnings per share:
 
 

 
 

 
 

 
 

Basic
 
$
0.32

 
$
0.48

 
$
0.49

 
$
0.51

Diluted
 
$
0.32

 
$
0.44

 
$
0.46

 
$
0.47

Corporate EBITDA (a)
 
$
553

 
$
731

 
NR

 
$
741

Adjusted pre-tax Income (loss) (a)
 
322

 
507

 
NR

 
520


(a)      Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule III.

SELECTED UNAUDITED CONSOLIDATED BALANCE SHEET DATA
(In millions)
 
As of September 30,
2014
 
As of December 31,
2013
As Restated
 
As of December 31,
2013
As Revised
Cash and cash equivalents
 
$
629

 
$
411

 
$
423

Restricted cash
 
748

 
861

 
860

Revenue earning equipment:
 
 

 
 

 
 

U.S. Car Rental
 
8,312

 
8,629

 
8,629

International Car Rental
 
2,806

 
2,047

 
2,047

Worldwide Equipment Rental
 
2,534

 
2,416

 
2,416

All Other Operations
 
1,200

 
1,099

 
1,101

Total revenue earning equipment, net
 
14,852

 
14,191

 
14,193

Total assets
 
25,474

 
24,423

 
24,588

Total debt
 
16,986

 
16,309

 
16,309

Net Fleet debt (a)
 
9,529

 
9,034

 
9,034

Net Corporate debt (a) (b)
 
6,080

 
6,003

 
5,992

Total equity
 
2,779

 
2,567

 
2,771

(a)         Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule VI.
(b)         Fleet related to Hertz Equipment Rental Corporation is funded via Corporate Debt.

34



SELECTED UNAUDITED CONSOLIDATED CASH FLOW DATA
 
 
Nine Months Ended
September 30,
 
Nine Months Ended
September 30,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Cash provided by (used in):
 
 

 
 

 
 

 
 

Operating activities
 
$
2,729

 
$
2,812

 
$
2,837

 
$
2,852

Investing activities
 
(3,283
)
 
(4,046
)
 
(4,034
)
 
(4,035
)
Financing activities
 
790

 
1,201

 
1,201

 
1,201

Effect of exchange rate changes
 
(18
)
 
(2
)
 
(2
)
 
(2
)
Net change in cash and cash equivalents
 
$
218

 
$
(35
)
 
$
2

 
$
16

Fleet growth (a)
 
$
(381
)
 
$
(798
)
 
NR

 
$
(806
)
Free cash flow (a)
 
64

 
(3
)
 
21

 
15


(a)       Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules IV and V.

SELECTED UNAUDITED OPERATING DATA BY SEGMENT
 
 
Three Months Ended September 30,
 
Three Months 
Ended 
September 30,
 
 
2014
 
2013
As Restated
 
2013
As Reported
U.S. Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
37,901

 
36,064

 
36,064

Total RPD (a)
 
$
46.41

 
$
48.36

 
$
48.33

Average Fleet
 
515,300

 
516,800

 
516,800

Fleet efficiency(a)
 
80
%
 
80
%
 
NR

Net depreciation per unit per month(a)
 
$
265

 
$
217

 
NR

Program cars as a percentage of total average fleet at period end
 
15
%
 
7
%
 
NR

Adjusted pre-tax income (in millions) (a)
 
$
209

 
$
379

 
$
392

International Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
14,695

 
14,278

 
14,278

Total RPD(a)(b)
 
$
54.85

 
$
55.12

 
$
55.27

Average Fleet
 
196,900

 
188,700

 
188,700

Fleet efficiency(a)
 
81
%
 
82
%
 
NR

Net depreciation per unit per month(a)
 
$
245

 
$
274

 
NR

Program cars as a percentage of total average fleet at period end
 
40
%
 
36
%
 
NR

Adjusted pre-tax income (loss) (in millions)(a)
 
$
136

 
$
126

 
$
129

Worldwide Equipment Rental
 
 

 
 

 
 

Dollar utilization
 
37
%
 
38
%
 
NR

Time utilization
 
66
%
 
67
%
 
NR

Rental and rental related revenue (in millions)(a)(b)
 
$
382

 
$
369

 
$
372

Same store revenue growth, including growth initiatives (b)
 
6
%
 
7
%
 
7
%
Adjusted pre-tax income (in millions)(a)
 
$
79

 
$
89

 
$
88

All Other Operations
 
 

 
 

 
 

Average fleet — Donlen
 
169,700

 
170,800

 
170,800

Adjusted pre-tax income (in millions)(a)
 
$
17

 
$
14

 
$
14

(a)     Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules III and VI.
(b)     Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.

35



SUPPLEMENTAL SCHEDULES AND DEFINITIONS
 
The following Supplemental Schedules and definitions are provided to present segment results and reconciliations of non-GAAP measures to their most comparable GAAP measure. Following the Supplemental Schedules we provide definitions for terminology used throughout these schedules.
 
 
Supplemental Schedule I

HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited

 
Three Months Ended September 30, 2014
 
Three Months Ended September 30, 2013
As Restated
 
Three Months 
Ended
September 30,
 
Three Months 
Ended
September 30,
(In millions)
U.S. Car Rental
 
Int’l Car Rental
 
Worldwide
Equipment Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
U.S. Car Rental
 
Int’l Car Rental
 
Worldwide
Equipment Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
As Revised Consolidated HGH
 
As Reported Consolidated HGH
Total revenues:
$
1,768

 
$
795

 
$
413

 
$
145

 
$
—

 
$
3,121

 
$
1,770

 
$
768

 
$
403

 
$
134

 
$
—

 
$
3,075

 
$
3,070

 
$
3,070

Expenses:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct operating
1,041

 
427

 
221

 
6

 
7

 
1,702

 
933

 
411

 
206

 
6

 
(9
)
 
1,547

 
1,540

 
1,525

Depreciation of revenue earning equipment and lease charges, net
409

 
143

 
78

 
116

 
—

 
746

 
337

 
151

 
76

 
108

 
—

 
672

 
675

 
677

Selling, general and administrative
116

 
68

 
47

 
7

 
65

 
303

 
113

 
74

 
33

 
7

 
55

 
282

 
272

 
278

Interest expense, net
44

 
27

 
12

 
3

 
78

 
164

 
47

 
31

 
13

 
6

 
82

 
179

 
179

 
179

Other (income) expense, net
(2
)
 
—

 
(1
)
 
—

 
6

 
3

 
43

 
—

 
(1
)
 
—

 
41

 
83

 
83

 
83

Total expenses
1,608

 
665

 
357

 
132

 
156

 
2,918

 
1,473

 
667

 
327

 
127

 
169

 
2,763

 
2,749

 
2,742

Income (loss) before income taxes
$
160

 
$
130

 
$
56

 
$
13

 
$
(156
)
 
$
203

 
$
297

 
$
101

 
$
76

 
$
7

 
$
(169
)
 
$
312

 
$
321

 
$
328

Provision for taxes on income
 

 
 

 
 

 
 

 
 

 
(54
)
 
 

 
 

 
 

 
 

 
 

 
(110
)
 
(111
)
 
(113
)
Net income (loss)
 

 
 

 
 

 
 

 
 

 
$
149

 
 

 
 

 
 

 
 

 
 

 
$
202

 
$
210

 
$
215


36



Supplemental Schedule II


HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited

 
Three Months Ended September 30, 2014
 
Three Months Ended September 30, 2013 As Restated
 
Three Months Ended September 30, 2013 As Reported
 
(In millions, except per share data)
GAAP
 
Adjustments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjustments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjustments
 
Adjusted
(Non-GAAP)
 
Total revenues
$
3,121

 
$
—

 
$
3,121

 
$
3,075

 
$
—

 
$
3,075

 
$
3,070

 
$
—

 
$
3,070

 
Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Direct operating
1,702

 
(61
)
 
1,641

 
1,547

 
(56
)
 
1,491

 
1,525

 
(52
)
 
1,473

 
Depreciation of revenue earning equipment and lease charges, net
746

 
—

 
746

 
672

 
(3
)
 
669

 
677

 
(3
)
 
674

 
Selling, general and administrative
303

 
(43
)
 
260

 
282

 
(35
)
 
247

 
278

 
(36
)
 
242

 
Interest expense, net
164

 
(13
)
 
151

 
179

 
(18
)
 
161

 
179

 
(18
)
 
161

 
Other (income) expense, net
3

 
(2
)
 
1

 
83

 
(83
)
 
—

 
83

 
(83
)
 
—

 
Total expenses
2,918

 
(119
)
 
2,799

 
2,763

 
(195
)
 
2,568

 
2,742

 
(192
)
 
2,550

 
Income (loss) before income taxes
203

 
119

 
322

 
312

 
195

 
507

 
328

 
192

 
520

 
(Provision) benefit for taxes on income (loss)
(54
)
 
(44
)
(a)
(98
)
 
(110
)
 
(68
)
(a)
(178
)
 
(113
)
 
(69
)
 
(182
)
(a)
Net income (loss)
$
149

 
$
75

 
$
224

 
$
202

 
$
127

 
$
329

 
$
215

 
$
123

 
$
338

 
Weighted average number of diluted shares outstanding
464

 
464

 
464

 
465

 
465

 
465

 
465

 
465

 
465

 
Diluted earnings (loss) per share (b)
$
0.32

 
$
0.16

 
$
0.48

 
$
0.44

 
$
0.27

 
$
0.71

 
$
0.47

 
$
0.26

 
$
0.73

 
(a) Represents a provision for income taxes derived utilizing a normalized income tax rate (37% for 2014 and 35% for 2013).
(b) Net income (loss) used in diluted earnings per share calculation includes an adjustment to add back to net income the amount of interest expense on convertible senior notes, net of tax of $2 million,for the quarter ended September 30, 2013.



37



Supplemental Schedule III
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME TAXES
TO EBITDA, CORPORATE EBITDA AND ADJUSTED PRE-TAX INCOME BY SEGMENT
Unaudited 
 
Three Months Ended September 30, 2014
 
Three Months Ended September 30, 2013
As Restated
 
Three Months Ended
September 30,  2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car
Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
Consolidated  HGH
Income (loss) before income taxes
$
160

 
$
130

 
$
56

 
$
13

 
$
(156
)
 
$
203

 
$
297

 
$
101

 
$
76

 
$
7

 
$
(169
)
 
$
312

 
$
328

Depreciation and amortization
465

 
152

 
97

 
118

 
5

 
837

 
387

 
159

 
94

 
110

 
4

 
754

 
755

Interest, net of interest income
44

 
27

 
12

 
3

 
78

 
164

 
47

 
31

 
13

 
6

 
82

 
179

 
179

EBITDA
$
669

 
$
309

 
$
165

 
$
134

 
$
(73
)
 
$
1,204

 
$
731

 
$
291

 
$
183

 
$
123

 
$
(83
)
 
$
1,245

 
$
1,262

Car rental fleet depreciation
(409
)
 
(143
)
 
—

 
(116
)
 
—

 
(668
)
 
(337
)
 
(151
)
 
—

 
(108
)
 
—

 
(596
)
 
(600
)
Car rental fleet interest
(45
)
 
(23
)
 
—

 
(4
)
 
—

 
(72
)
 
(46
)
 
(27
)
 
—

 
(7
)
 
—

 
(80
)
 
(80
)
Car rental fleet debt - related charges
3

 
4

 
—

 
1

 
—

 
8

 
2

 
3

 
—

 
4

 
—

 
9

 
9

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
7

 
7

 
—

 
—

 
—

 
—

 
11

 
11

 
11

Restructuring and restructuring related charges
29

 
1

 
1

 
—

 
24

 
55

 
8

 
12

 
1

 
—

 
18

 
39

 
39

Acquisition related costs and charges
—

 
—

 
—

 
—

 
1

 
1

 
—

 
—

 
—

 
—

 
3

 
3

 
3

Integration expenses
—

 
—

 
—

 
—

 
1

 
1

 
6

 
—

 
—

 
—

 
2

 
8

 
9

Equipment Rental spin-off costs
—

 
—

 
12

 
—

 
2

 
14

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Relocation costs
—

 
—

 
—

 
—

 
3

 
3

 
4

 
—

 
—

 
—

 
—

 
4

 
4

Premiums paid on debt
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Loss on extinguishment of debt
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
28

 
28

 
—

Impairment charges and asset write-downs
—

 
—

 
—

 
—

 
—

 
—

 
40

 
—

 
—

 
—

 
—

 
40

 
44

Other extraordinary, unusual or non-recurring items
—

 
(1
)
 
—

 
—

 
1

 
—

 
4

 
7

 
—

 
—

 
9

 
20

 
40

Corporate EBITDA
$
247

 
$
147

 
$
178

 
$
15

 
$
(34
)
 
$
553

 
$
412

 
$
135

 
$
184

 
$
12

 
$
(12
)
 
$
731

 
$
741

Non-fleet depreciation and amortization
(56
)
 
(9
)
 
(97
)
 
(2
)
 
(5
)
 
(169
)
 
(50
)
 
(8
)
 
(94
)
 
(2
)
 
(4
)
 
(158
)
 
(155
)
Non-fleet interest, net of interest income
1

 
(4
)
 
(12
)
 
1

 
(78
)
 
(92
)
 
(1
)
 
(4
)
 
(13
)
 
1

 
(82
)
 
(99
)
 
(99
)
Non-fleet debt - related charges
—

 
—

 
1

 
1

 
3

 
5

 
—

 
—

 
1

 
(1
)
 
8

 
8

 
9

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
(7
)
 
(7
)
 
—

 
—

 
—

 
—

 
(11
)
 
(11
)
 
(11
)
Acquisition accounting
17

 
2

 
9

 
2

 
2

 
32

 
18

 
3

 
10

 
4

 
—

 
35

 
35

Other accounting
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
1

 
—

 
—

 
1

 
—

Adjusted Pre-Tax Income (Loss)
$
209

 
$
136

 
$
79

 
$
17

 
$
(119
)
 
$
322

 
$
379

 
$
126

 
$
89

 
$
14

 
$
(101
)
 
$
507

 
$
520


38



Supplemental Schedule IV
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FREE CASH FLOW
Unaudited
 
 
 
Nine Months Ended
September 30,
 
Nine Months Ended
September 30,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Income before income taxes
 
$
261

 
$
563

 
$
601

 
$
612

Depreciation and amortization, non-fleet
 
272

 
249

 
241

 
241

Amortization of debt discount and related charges
 
35

 
54

 
54

 
54

Cash paid for income taxes
 
(47
)
 
(56
)
 
(56
)
 
(56
)
Changes in assets and liabilities, net of effects of acquisitions, and other
 
89

 
169

 
172

 
154

Net cash provided by operating activities excluding depreciation of revenue earning equipment
 
610

 
979

 
1,012

 
1,005

U.S. car rental fleet growth (a)
 
134

 
(489
)
 
NR

 
NR

International car rental fleet growth (a)
 
(401
)
 
(49
)
 
NR

 
NR

Equipment rental fleet growth (a)
 
(105
)
 
(258
)
 
NR

 
NR

All other operations rental fleet growth (a)
 
(9
)
 
(2
)
 
NR

 
NR

Property and equipment expenditures, net of disposals
 
(165
)
 
(184
)
 
(184
)
 
(184
)
Net investment activity
 
(546
)
 
(982
)
 
(991
)
 
(990
)
Free cash flow
 
$
64

 
$
(3
)
 
$
21

 
$
15


(a)         Historically, fleet growth has not been reported on a segment basis.

39



Supplemental Schedule V
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - FLEET GROWTH
Unaudited
 
 
Nine Months Ended September 30, 2014
 
Nine Months Ended September 30, 2013
As Restated
 
Nine Months
Ended
September 30,
2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
Consolidated
HGH
Revenue earning equipment expenditures
$
(4,128
)
 
$
(2,694
)
 
$
(470
)
 
$
(1,150
)
 
$
(8,442
)
 
$
(5,412
)
 
$
(2,574
)
 
$
(582
)
 
$
(750
)
 
$
(9,318
)
 
$
(9,677
)
Proceeds from disposal of revenue earning equipment
3,019

 
1,456

 
130

 
711

 
5,316

 
3,506

 
1,654

 
101

 
401

 
5,662

 
5,669

Net revenue earning equipment capital expenditures
(1,109
)
 
(1,238
)
 
(340
)
 
(439
)
 
(3,126
)
 
(1,906
)
 
(920
)
 
(481
)
 
(349
)
 
(3,656
)
 
(4,008
)
Depreciation of revenue earning equipment
1,222

 
321

 
235

 
340

 
2,118

 
943

 
350

 
223

 
316

 
1,832

 
1,847

Financing activity related to car rental fleet:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Borrowings
1,021

 
1,287

 
—

 
438

 
2,746

 
2,694

 
1,234

 
—

 
993

 
4,921

 
NR

Payments
(1,085
)
 
(745
)
 
—

 
(350
)
 
(2,180
)
 
(2,303
)
 
(682
)
 
—

 
(947
)
 
(3,932
)
 
NR

Restricted cash changes
85

 
(26
)
 
—

 
2

 
61

 
83

 
(31
)
 
—

 
(15
)
 
37

 
NR

Net financing activity related to car rental fleet
21

 
516

 
—

 
90

 
627

 
474

 
521

 
—

 
31

 
1,026

 
1,354

Fleet growth
$
134

 
$
(401
)
 
$
(105
)
 
$
(9
)
 
$
(381
)
 
$
(489
)
 
$
(49
)
 
$
(258
)
 
$
(2
)
 
$
(798
)
 
$
(806
)

40



Supplemental Schedule VI
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS
Unaudited
 
NET CORPORATE DEBT, NET FLEET DEBT AND TOTAL NET DEBT
 
 
 
 
 
 
 
 
As of December 31, 2013
 
As of December 31, 2013
 
As of September 30, 2014
 
As Restated
 
As Revised
(In millions)
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
Debt
$
10,237

 
$
6,749

 
$
16,986

 
$
9,806

 
$
6,503

 
$
16,309

 
$
9,806

 
$
6,503

 
$
16,309

Less:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
—

 
629

 
629

 
—

 
411

 
411

 
—

 
423

 
423

Restricted cash
708

 
40

 
748

 
772

 
89

 
861

 
772

 
88

 
860

Net debt
$
9,529

 
$
6,080

 
$
15,609

 
$
9,034

 
$
6,003

 
$
15,037

 
$
9,034

 
$
5,992

 
$
15,026

 
WORLDWIDE EQUIPMENT RENTAL AND RENTAL RELATED REVENUE
 
 
 
Three Months Ended
September 30,
 
Three Months
Ended
September 30,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Reported
Equipment rental segment revenues
 
$
413

 
$
403

 
$
402

Equipment sales and other revenue
 
(33
)
 
(33
)
 
(33
)
Rental and rental related revenue at actual rates
 
380

 
370

 
369

Foreign currency adjustment (a)
 
2

 
(1
)
 
3

Rental and rental related revenue
 
$
382

 
$
369

 
$
372


(a)
Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


41



Supplemental Schedule VI (continued)

HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH
 
U.S. Car Rental
 
 
Three Months Ended September 30,
 
Three Months Ended
September 30,
(In millions, except as noted)
 
2014
 
2013
As Restated
 
2013
As Reported
Total RPD
 
 
 
 
 
 
Revenues
 
$
1,768

 
$
1,770

 
$
1,766

Advantage sublease revenue
 
—

 
(22
)
 
(23
)
Ancillary retail car sales revenue
 
(9
)
 
(4
)
 
—

Total rental revenue
 
$
1,759

 
$
1,744

 
$
1,743

Transaction days (in thousands)
 
37,901

 
36,064

 
36,064

Total RPD (in whole dollars)
 
$
46.41

 
$
48.36

 
$
48.33

Fleet Efficiency
 
 
 
 
 
 
Transaction days (in thousands)
 
37,901

 
36,064

 
 

Average Fleet
 
515,300

 
516,800

 
 

Advantage sublease vehicles
 
(1,000
)
 
(23,000
)
 
 

Hertz 24/7 vehicles
 
(1,000
)
 
(2,000
)
 
 

Average Fleet used to calculate fleet efficiency
 
513,300

 
491,800

 
 

Number of days in period
 
92

 
92

 
 

Average fleet multiplied by number of dates in period (in thousands)
 
$
47,224

 
$
45,246

 
 

Fleet efficiency
 
80
%
 
80
%
 
 

Net Depreciation Per Unit Per Month
 
 
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net
 
$
409

 
$
337

 
 

Average fleet
 
515,300

 
516,800

 
 

Depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
794

 
$
652

 
 

Number of months in period
 
3

 
3

 
 

Net depreciation per unit per month (in whole dollars)
 
$
265

 
$
217

 
 



42



Supplemental Schedule VI (continued)

HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH

International Car Rental
 
 
Three Months Ended September 30,
 
Three Months Ended
September 30,
(in millions, except as noted)
 
2014
 
2013
As Restated
 
2013
As Reported
Revenues
 
$
795

 
$
768

 
$
768

Foreign currency adjustment (a)
 
11

 
19

 
21

Total rental revenue
 
$
806

 
$
787

 
$
789

Transaction days (in thousands)
 
14,695

 
14,278

 
14,278

Total RPD (in whole dollars)
 
$
54.85

 
$
55.12

 
$
55.27

Transaction days (in thousands)
 
14,695

 
14,278

 
 
Average Fleet
 
196,900

 
188,700

 
 
Number of days in period
 
92

 
92

 
 
Average fleet multiplied by number of days in period
 
18,115

 
17,360

 
 
Fleet efficiency
 
81
%
 
82
%
 
 
Depreciation of revenue earning equipment and lease charges, net
 
$
143

 
$
151

 
 
Foreign currency adjustment (a) 
 
2

 
4

 
 
Adjusted depreciation of revenue earning equipment and lease charges, net
 
$
145

 
$
155

 
 
Average fleet
 
196,900

 
188,700

 
 
Adjusted depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
736

 
$
821

 
 
Number of months in period
 
3

 
3

 
 
Net depreciation per unit per month (in whole dollars)
 
$
245

 
$
274

 
 

(a)         Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.

43



FINANCIAL INFORMATION AND OPERATING DATA
 
SELECTED UNAUDITED CONSOLIDATED INCOME STATEMENT DATA
 
 
Three Months Ended
June 30,
 
Three Months Ended
June 30,
(In millions, except per share data)
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Total revenues
 
$
2,830

 
$
2,708

 
$
2,709

 
$
2,715

Expenses:
 
 

 
 

 
 

 
 

Direct operating
 
1,594

 
1,417

 
1,414

 
1,406

Depreciation of revenue earning equipment and lease charges, net
 
708

 
632

 
628

 
641

Selling, general and administrative
 
264

 
287

 
280

 
275

Interest expense, net
 
164

 
182

 
182

 
182

Other income, net
 
(21
)
 
(2
)
 
(1
)
 
(1
)
Total expenses
 
2,709

 
2,516

 
2,503

 
2,503

Income (loss) before income taxes
 
121

 
192

 
206

 
212

(Provision) benefit for taxes on income (loss)
 
(49
)
 
(81
)
 
(85
)
 
(91
)
Net income (loss)
 
$
72

 
$
111

 
$
121

 
$
121

Weighted average number of shares outstanding:
 
 

 
 

 
 

 
 

Basic
 
452

 
401

 
401

 
401

Diluted
 
465

 
465

 
465

 
465

Earnings per share:
 
 

 
 

 
 

 
 

Basic
 
$
0.16

 
$
0.28

 
$
0.30

 
$
0.30

Diluted
 
$
0.15

 
$
0.25

 
$
0.27

 
$
0.27

Corporate EBITDA (a)
 
$
446

 
$
522

 
NR

 
$
541

Adjusted pre-tax Income (loss) (a)
 
216

 
296

 
NR

 
314

(a)
 Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule III.
 
SELECTED UNAUDITED CONSOLIDATED BALANCE SHEET DATA
(In millions)
 
As of June 30,
2014
 
As of
December 31,
2013
As Restated
 
As of
December 31,
2013
As Revised
Cash and cash equivalents
 
$
540

 
$
411

 
$
423

Restricted cash
 
717

 
861

 
860

Revenue earning equipment:
 
 

 
 

 
 

U.S. Car Rental
 
8,980

 
8,629

 
8,629

International Car Rental
 
3,135

 
2,047

 
2,047

Worldwide Equipment Rental
 
2,520

 
2,416

 
2,416

All Other Operations
 
1,194

 
1,099

 
1,101

Total revenue earning equipment, net
 
15,829

 
14,191

 
14,193

Total assets
 
26,169

 
24,423

 
24,588

Total debt
 
17,310

 
16,309

 
16,309

Net Fleet debt (a)
 
9,429

 
9,034

 
9,034

Net Corporate debt (a) (b)
 
6,624

 
6,003

 
5,992

Total equity
 
2,666

 
2,567

 
2,771

(a)
 Represents a non-GAAP measure, see the accompanying reconciliations included in Supplemental Schedule VI.
(b)
 Fleet related to Hertz Equipment Rental Corporation is funded via Corporate Debt


44



SELECTED UNAUDITED CONSOLIDATED CASH FLOW DATA
 
 
Six Months Ended June 30,
 
Six Months Ended June 30,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Cash provided by (used in):
 
 

 
 

 
 

 
 

Operating activities
 
$
1,402

 
$
1,444

 
$
1,448

 
$
1,459

Investing activities
 
(2,248
)
 
(3,273
)
 
(3,267
)
 
(3,264
)
Financing activities
 
977

 
1,764

 
1,763

 
1,763

Effect of exchange rate changes
 
(2
)
 
(9
)
 
(8
)
 
(8
)
Net change in cash and cash equivalents
 
$
129

 
$
(74
)
 
$
(64
)
 
$
(50
)
Fleet growth (a)
 
$
(592
)
 
$
(545
)
 
NR

 
$
(543
)
Free cash flow (a)
 
(689
)
 
(408
)
 
(397
)
 
(404
)
 

(a)         Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules IV and V.
 
SELECTED UNAUDITED OPERATING DATA BY SEGMENT
 
 
 
Three Months Ended June 30,
 
Three Months
Ended June 30,
 
 
2014
 
2013
As Restated
 
2013
As Reported
U.S. Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
35,850

 
34,178

 
34,178

Total RPD (a)
 
$
46.19

 
$
46.11

 
$
46.78

Average fleet
 
502,500

 
499,000

 
498,800

Fleet efficiency(a)
 
79
%
 
79
%
 
NR

Net depreciation per unit per month(a)
 
$
259

 
$
216

 
NR

Program cars as a percentage of total average fleet at period end
 
16
%
 
3
%
 
NR

Adjusted pre-tax income (in millions) (a)
 
$
184

 
$
289

 
NR

International Car Rental
 
 

 
 

 
 

Transaction days (in thousands)
 
12,096

 
11,261

 
11,261

Total RPD (a)(b)
 
$
52.58

 
$
53.73

 
$
54.05

Average Fleet
 
172,300

 
163,500

 
163,500

Fleet efficiency(a)
 
77
%
 
76
%
 
NR

Net depreciation per unit per month(a)
 
$
238

 
$
273

 
NR

Program cars as a percentage of total average fleet at period end
 
42
%
 
38
%
 
NR

Adjusted pre-tax income (loss) (in millions) (a)
 
$
57

 
$
35

 
NR

Worldwide Equipment Rental
 
 

 
 

 
 

Dollar utilization
 
35
%
 
37
%
 
NR

Time utilization
 
63
%
 
64
%
 
NR

Rental and rental related revenue (in millions) (a)(b)
 
$
356

 
$
343

 
$
351

Same store revenue growth, including growth initiatives (b)
 
4
%
 
11
%
 
11
%
Adjusted pre-tax income (in millions) (a)
 
$
67

 
$
73

 
NR

All Other Operations
 
 

 
 

 
 

Average fleet — Donlen
 
177,800

 
168,000

 
168,000

Adjusted pre-tax income (in millions) (a)
 
$
15

 
$
14

 
NR

 
(a)
 Represents a non-GAAP measure, see the accompanying reconciliations included in the Supplemental Schedules III and VI
(b)
Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.

45



SUPPLEMENTAL SCHEDULES AND DEFINITIONS
 
The following Supplemental Schedules and definitions are provided to present segment results and reconciliations of non-GAAP measures to their most comparable GAAP measure. Following the Supplemental Schedules we provide definitions for terminology used throughout these schedules.
 
Supplemental Schedule I
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
 
Three Months Ended June 30, 2014
 
Three Months Ended June 30, 2013
As Restated
 
Three Months Ended 
June 30, 2013
(In millions)
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
As Revised Consolidated HGH
 
As Reported Consolidated HGH
Total revenues:
$
1,663

 
$
641

 
$
384

 
$
142

 
$
—

 
$
2,830

 
$
1,602

 
$
595

 
$
381

 
$
130

 
$
—

 
$
2,708

 
$
2,709

 
$
2,715

Expenses:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct operating
990

 
394

 
210

 
6

 
(6
)
 
1,594

 
865

 
347

 
204

 
6

 
(5
)
 
1,417

 
1,414

 
1,406

Depreciation of revenue earning equipment and lease charges, net
391

 
124

 
79

 
114

 
—

 
708

 
323

 
132

 
73

 
104

 
—

 
632

 
628

 
641

Selling, general and administrative
93

 
63

 
35

 
8

 
65

 
264

 
113

 
69

 
32

 
8

 
65

 
287

 
280

 
275

Interest expense, net
44

 
25

 
12

 
3

 
80

 
164

 
45

 
28

 
12

 
2

 
95

 
182

 
182

 
182

Other (income) expense, net
(22
)
 
3

 
(1
)
 
—

 
(1
)
 
(21
)
 
(1
)
 
—

 
(2
)
 
(1
)
 
2

 
(2
)
 
(1
)
 
(1
)
Total expenses
1,496

 
609

 
335

 
131

 
138

 
2,709

 
1,345

 
576

 
319

 
119

 
157

 
2,516

 
2,503

 
2,503

Income (loss) before income taxes
$
167

 
$
32

 
$
49

 
$
11

 
$
(138
)
 
121

 
$
257

 
$
19

 
$
62

 
$
11

 
$
(157
)
 
$
192

 
$
206

 
$
212

(Provision) benefit for taxes on income
 

 
 

 
 

 
 

 
 

 
(49
)
 
 

 
 

 
 

 
 

 
 

 
(81
)
 
(85
)
 
(91
)
Net income (loss)
 

 
 

 
 

 
 

 
 

 
$
72

 
 

 
 

 
 

 
 

 
 

 
$
111

 
$
121

 
$
121


46



Supplemental Schedule II
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
 
Three Months Ended June 30, 2014
 
Three Months Ended June 30, 2013
As Restated
 
Three Months Ended June 30, 2013
As Reported
(In millions, except per share data)
GAAP
 
Adjustments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjustments
 
Adjusted
(Non-GAAP)
 
GAAP
 
Adjustments
 
Adjusted
(Non-GAAP)
Total revenues
$
2,830

 
$
—

 
$
2,830

 
$
2,708

 
$
—

 
$
2,708

 
$
2,715

 
$
—

 
$
2,715

Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Direct operating
1,594

 
(59
)
 
1,535

 
1,417

 
(47
)
 
1,370

 
1,406

 
(45
)
 
1,361

Depreciation of revenue earning equipment and lease charges, net
708

 
(6
)
 
702

 
632

 
(2
)
 
630

 
641

 
(2
)
 
639

Selling, general and administrative
264

 
(34
)
 
230

 
287

 
(36
)
 
251

 
275

 
(35
)
 
240

Interest expense, net
164

 
(13
)
 
151

 
182

 
(18
)
 
164

 
182

 
(19
)
 
163

Other (income) expense, net
(21
)
 
17

 
(4
)
 
(2
)
 
(1
)
 
(3
)
 
(1
)
 
(2
)
 
(3
)
Total expenses
2,709

 
(95
)
 
2,614

 
2,516

 
(104
)
 
2,412

 
2,503

 
(103
)
 
2,400

Income (loss) before income taxes
121

 
95

 
216

 
192

 
104

 
296

 
212

 
103

 
315

(Provision) benefit for taxes on income (loss)
(49
)
 
(35
)
(a)
(84
)
 
(81
)
 
(36
)
(a)
(117
)
 
(91
)
 
(20
)
(a)
(111
)
Net income (loss)
$
72

 
$
60

 
$
132

 
$
111

 
$
68

 
$
179

 
$
121

 
$
83

 
$
204

Weighted average number of diluted shares outstanding
465

 
465

 
465

 
465

 
465

 
465

 
465

 
465

 
465

Diluted earnings (loss) per share (b)
$
0.15

 
$
0.13

 
$
0.28

 
$
0.25

 
$
0.15

 
$
0.39

 
0.27

 
NR

 
NR


(a)
Represents a provision for income taxes derived utilizing a normalized income tax rate (37% for 2014 and 35% for 2013).
(b)
Net income (loss) used in diluted earnings per share calculation includes an adjustment to add back to net income the amount of interest expense on convertible senior notes, net of tax of $4 million, for the quarter ended June 30, 2013.


47



Supplemental Schedule III
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME TAXES
TO EBITDA, CORPORATE EBITDA AND ADJUSTED PRE-TAX INCOME BY SEGMENT
Unaudited
 
 
Three Months Ended June 30, 2014
 
Three Months Ended June 30, 2013
As Restated
 
Three Months
Ended June 30,
2013
As Reported
(In millions)
U.S. Car Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
U.S. Car Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Corporate
 
Consolidated
HGH
 
Consolidated
HGH
Income (loss) before income taxes
$
167

 
$
32

 
$
49

 
$
11

 
$
(138
)
 
$
121

 
$
257

 
$
19

 
$
62

 
$
11

 
$
(157
)
 
$
192

 
$
212

Depreciation and amortization
447

 
135

 
97

 
116

 
4

 
799

 
374

 
140

 
91

 
107

 
3

 
715

 
722

Interest, net of interest income
44

 
25

 
12

 
3

 
80

 
164

 
45

 
28

 
12

 
2

 
95

 
182

 
182

EBITDA
$
658

 
$
192

 
$
158

 
$
130

 
$
(54
)
 
$
1,084

 
$
676

 
$
187

 
$
165

 
$
120

 
$
(59
)
 
$
1,089

 
$
1,116

Car rental fleet depreciation
(391
)
 
(124
)
 
—

 
(114
)
 
—

 
(629
)
 
(323
)
 
(132
)
 
—

 
(104
)
 
—

 
(559
)
 
(568
)
Car rental fleet interest
(45
)
 
(22
)
 
—

 
(3
)
 
—

 
(70
)
 
(45
)
 
(26
)
 
—

 
(3
)
 
—

 
(74
)
 
(73
)
Car rental fleet debt - related charges
1

 
5

 
—

 
1

 
—

 
7

 
1

 
4

 
—

 
—

 
—

 
5

 
5

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
5

 
5

 
—

 
—

 
—

 
—

 
11

 
11

 
12

Restructuring and restructuring related charges
4

 
14

 
2

 
—

 
11

 
31

 
12

 
10

 
1

 
—

 
3

 
26

 
26

Acquisition related costs and charges
—

 
—

 
—

 
—

 
2

 
2

 
—

 
—

 
—

 
—

 
8

 
8

 
9

Integration expenses
—

 
—

 
—

 
—

 
3

 
3

 
(1
)
 
—

 
—

 
—

 
10

 
9

 
9

Equipment Rental spin-off costs
—

 
—

 
6

 
—

 
6

 
12

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Relocation costs
—

 
—

 
—

 
—

 
3

 
3

 
—

 
—

 
—

 
—

 
1

 
1

 
—

Impairment charges and asset write-downs
10

 
—

 
—

 
—

 
—

 
10

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Other extraordinary, unusual or non-recurring items
(16
)
 
3

 
—

 
—

 
1

 
(12
)
 
1

 
—

 
(1
)
 
(1
)
 
7

 
6

 
5

Corporate EBITDA
$
221

 
$
68

 
$
166

 
$
14

 
$
(23
)
 
$
446

 
$
321

 
$
43

 
$
165

 
$
12

 
$
(19
)
 
$
522

 
$
541

Non-fleet depreciation and amortization
(56
)
 
(11
)
 
(97
)
 
(2
)
 
(4
)
 
(170
)
 
(51
)
 
(8
)
 
(91
)
 
(3
)
 
(3
)
 
(156
)
 
(154
)
Non-fleet interest, net of interest income
1

 
(3
)
 
(12
)
 
—

 
(80
)
 
(94
)
 
—

 
(2
)
 
(12
)
 
1

 
(95
)
 
(108
)
 
(109
)
Non-fleet debt - related charges
1

 
—

 
1

 
—

 
4

 
6

 
1

 
—

 
1

 
—

 
12

 
14

 
15

Non-cash stock-based employee compensation charges
—

 
—

 
—

 
—

 
(5
)
 
(5
)
 
—

 
—

 
—

 
—

 
(11
)
 
(11
)
 
(12
)
Acquisition accounting
17

 
3

 
9

 
3

 
1

 
33

 
18

 
2

 
10

 
4

 
1

 
35

 
33

Adjusted Pre-Tax Income (Loss)
$
184

 
$
57

 
$
67

 
$
15

 
$
(107
)
 
$
216

 
$
289

 
$
35

 
$
73

 
$
14

 
$
(115
)
 
$
296

 
$
314


48



Supplemental Schedule IV
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEAURE - FREE CASH FLOW
Unaudited
 
 
 
 
Six Months Ended
June 30,
 
Six Months Ended
June 30,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Revised
 
2013
As Reported
Income before income taxes
 
$
58

 
$
252

 
$
280

 
$
284

Depreciation and amortization, non-fleet
 
180

 
167

 
163

 
163

Amortization of debt discount and related charges
 
25

 
37

 
37

 
37

Cash paid for income taxes
 
(33
)
 
(43
)
 
(43
)
 
(43
)
Changes in assets and liabilities, net of effects of acquisitions, and other
 
(221
)
 
(155
)
 
(163
)
 
(177
)
Net cash provided by operating activities excluding depreciation of revenue earning equipment
 
9

 
258

 
274

 
264

U.S. car rental fleet growth (a)
 
(321
)
 
(561
)
 
NR

 
NR

International car rental fleet growth (a)
 
(209
)
 
150

 
NR

 
NR

Equipment rental fleet growth (a)
 
(50
)
 
(136
)
 
NR

 
NR

All other operations rental fleet growth (a)
 
(12
)
 
2

 
NR

 
NR

Property and equipment expenditures, net of disposals
 
(106
)
 
(121
)
 
(125
)
 
(125
)
Net investment activity
 
(698
)
 
(666
)
 
(671
)
 
(668
)
Free cash flow
 
$
(689
)
 
$
(408
)
 
$
(397
)
 
$
(404
)

(a)
Historically, fleet growth has not been reported on a segment basis.

49



Supplemental Schedule V
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEAURE - FLEET GROWTH
Unaudited

 
Six Months Ended June 30, 2014
 
Six Months Ended June 30, 2013
As Restated
 
Six Months
Ended June
30, 2013
As Reported
(In millions)
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
U.S. Car
Rental
 
Int’l Car Rental
 
Worldwide
Equipment
Rental
 
All Other
Operations
 
Consolidated
HGH
 
Consolidated
HGH
Revenue earning equipment expenditures
$
(3,260
)
 
$
(1,673
)
 
$
(296
)
 
$
(767
)
 
$
(5,996
)
 
$
(4,463
)
 
$
(1,472
)
 
$
(365
)
 
$
(513
)
 
$
(6,813
)
 
$
(6,826
)
Proceeds from disposal of revenue earning equipment
2,114

 
1,059

 
89

 
455

 
3,717

 
2,396

 
993

 
82

 
266

 
3,737

 
3,743

Net revenue earning equipment capital expenditures
(1,146
)
 
(614
)
 
(207
)
 
(312
)
 
(2,279
)
 
(2,067
)
 
(479
)
 
(283
)
 
(247
)
 
(3,076
)
 
(3,083
)
Depreciation of revenue earning equipment
813

 
199

 
157

 
224

 
1,393

 
607

 
223

 
147

 
209

 
1,186

 
1,195

Financing activity related to car rental fleet:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Borrowings
619

 
720

 
—

 
420

 
1,759

 
2,470

 
918

 
—

 
47

 
3,435

 
NR

Payments
(731
)
 
(491
)
 
—

 
(350
)
 
(1,572
)
 
(1,741
)
 
(487
)
 
—

 
(2
)
 
(2,230
)
 
NR

Restricted cash changes
124

 
(23
)
 
—

 
6

 
107

 
170

 
(25
)
 
—

 
(5
)
 
140

 
NR

Net financing activity related to car rental fleet
12

 
206

 
—

 
76

 
294

 
899

 
406

 
—

 
40

 
1,345

 
1,345

Fleet growth
$
(321
)
 
$
(209
)
 
$
(50
)
 
$
(12
)
 
$
(592
)
 
$
(561
)
 
$
150

 
$
(136
)
 
$
2

 
$
(545
)
 
$
(543
)

50



Supplemental Schedule VI
 
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS
Unaudited

NET CORPORATE DEBT, NET FLEET DEBT AND TOTAL NET DEBT
 
 
 
 
 
 
 
 
As of December 31, 2013
 
As of December 31, 2013
 
As of June 30, 2014
 
As Restated
 
As Revised
(In millions)
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
 
Fleet
 
Corporate
 
Total
Debt
$
10,100

 
$
7,210

 
$
17,310

 
$
9,806

 
$
6,503

 
$
16,309

 
$
9,806

 
$
6,503

 
$
16,309

Less:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
—

 
540

 
540

 
—

 
411

 
411

 
—

 
423

 
423

Restricted cash
671

 
46

 
717

 
772

 
89

 
861

 
772

 
88

 
860

Net debt
$
9,429

 
$
6,624

 
$
16,053

 
$
9,034

 
$
6,003

 
$
15,037

 
$
9,034

 
$
5,992

 
$
15,026

 
WORLDWIDE EQUIPMENT RENTAL AND RENTAL RELATED REVENUE
 
 
 
Three Months Ended June 30,
(In millions)
 
2014
 
2013
As Restated
 
2013
As Reported
Equipment rental segment revenues
 
$
384

 
$
381

 
$
384

Equipment sales and other revenue
 
(29
)
 
(36
)
 
(35
)
Rental and rental related revenue at actual rates
 
355

 
345

 
349

Foreign currency adjustment (a)
 
1

 
(2
)
 
2

Rental and rental related revenue
 
$
356

 
$
343

 
$
351


(a)
Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


51



Supplemental Schedule VI (continued)

HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH

U.S. Car Rental Segment
 
 
Three Months Ended June 30,
(In millions, except as noted)
 
2014
 
2013
As Restated
Total RPD
 
 
 
 
Revenues
 
$
1,663

 
$
1,602

Advantage sublease revenue
 
—

 
(22
)
Ancillary retail car sales revenue
 
(7
)
 
(4
)
Total rental revenue
 
$
1,656

 
$
1,576

Transaction days (in thousands)
 
35,850

 
34,178

Total RPD (in whole dollars)
 
$
46.19

 
$
46.11

Fleet Efficiency
 
 
 
 
Transaction days (in thousands)
 
35,850

 
34,178

Average Fleet
 
502,500

 
499,000

Advantage sublease vehicles
 
(4,400
)
 
(24,000
)
Hertz 24/7 vehicles
 
(1,000
)
 
(1,000
)
Average Fleet used to calculate fleet efficiency
 
497,100

 
474,000

Number of days in period
 
91

 
91

Average fleet multiplied by number of dates in period (in thousands)
 
45,236

 
43,134

Fleet efficiency
 
79
%
 
79
%
Net Depreciation Per Unit Per Month
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net
 
$
391

 
$
323

Average fleet
 
502,500

 
499,000

Depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
778

 
$
647

Number of months in period
 
3

 
3

Net depreciation per unit per month (in whole dollars)
 
$
259

 
$
216



52



Supplemental Schedule VI (continued)

HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES - DEBT, REVENUE, DEPRECIATION AND KEY METRICS (CONTINUED)
Unaudited
 
TOTAL RPD, FLEET EFFICIENCY AND NET DEPRECIATION PER UNIT PER MONTH

International Car Rental

 
 
Three Months Ended June 30,
(in millions, except as noted)
 
2014
 
2013
As Restated
Total RPD
 
 
 
 
Revenues
 
$
641

 
$
595

Foreign currency adjustment (a)
 
(5
)
 
10

Total rental revenue
 
$
636

 
$
605

Transaction days (in thousands)
 
12,096

 
11,261

Total RPD (in whole dollars)
 
$
52.58

 
$
53.73

Fleet Efficiency
 
 
 
 
Transaction days (in thousands)
 
12,096

 
11,261

Average Fleet
 
172,300

 
163,500

Number of days in period
 
91

 
91

Average fleet multiplied by number of days in period
 
15,679

 
14,879

Fleet efficiency
 
77
%
 
76
%
Net Depreciation Per Unit Per Month
 
 
 
 
Depreciation of revenue earning equipment and lease charges, net
 
$
124

 
$
132

Foreign currency adjustment (a) 
 
(1
)
 
2

Adjusted depreciation of revenue earning equipment and lease charges, net
 
$
123

 
$
134

Average fleet
 
172,300

 
163,500

Adjusted depreciation of revenue earning equipment and lease charges, net divided by average fleet (in whole dollars)
 
$
714

 
$
820

Number of months in period
 
3

 
3

Net depreciation per unit per month (in whole dollars)
 
$
238

 
$
273


 
All Car Rental
 
Three Months Ended
 June 30,
(In millions, except as noted)
2013
As Reported
Revenues
$
2,330

Non-rental revenue
(134
)
Foreign currency adjustment (a)
12

Total rental revenue
$
2,208

Transaction days (in thousands)
45,439

Total RPD (in whole dollars)
$
48.58


(a)         Amounts shown for 2014 and 2013 As Restated are based on December 31, 2013 foreign exchange rates.  Amounts shown for 2013 As Reported are based on December 31, 2012 foreign exchange rates.


53



NON-GAAP MEASURES AND KEY METRICS - DEFINITIONS AND USE
 
Hertz Global is the top-level holding company and The Hertz Corporation is Hertz Global's primary operating company (together, the Company). The term “GAAP” refers to accounting principles generally accepted in the United States of America.
 
Definitions of non-GAAP measures are set forth below. Also set forth below is a summary of the reasons why management of the Company believes that the presentation of the non-GAAP financial measures included in the Press Release provide useful information regarding the Company's financial condition and results of operations and additional purposes, if any, for which management of the Company utilizes the non-GAAP measures.

Adjusted Pre-Tax Income (Loss) and Adjusted Pre-tax Margin

Adjusted pre-tax income is calculated as income before income taxes plus certain non-cash acquisition accounting charges, debt-related charges relating to the amortization and write-off of debt financing costs and debt discounts and certain one-time charges and non-operational items. Adjusted pre-tax income is important to management because it allows management to assess operational performance of our business, exclusive of the items mentioned above. It also allows management to assess the performance of the entire business on the same basis as the segment measure of profitability. Management believes that it is important to investors for the same reasons it is important to management and because it allows them to assess the operational performance of the Company on the same basis that management uses internally. Adjusted pre-tax margin is adjusted pre-tax income divided by total revenues.

Adjusted Net Income

Adjusted net income is calculated as adjusted pre-tax income less a provision for income taxes derived utilizing a normalized income tax rate of 37%. The normalized income tax rate is management's estimate of our long-term tax rate. Adjusted net income is important to management and investors because it represents our operational performance exclusive of the effects of purchase accounting, debt-related charges, one-time charges and items that are not operational in nature or comparable to those of our competitors.

Adjusted Diluted Earnings Per Share

Adjusted diluted earnings per share is calculated as adjusted net income divided by the weighted average diluted shares outstanding for the period, Adjusted diluted earnings per share is important to management and investors because it represents a measure of our operational performance exclusive of the effects of purchase accounting adjustments, debt-related charges, one-time charges and items that are not operational in nature or comparable to those of our competitors.

Average Fleet

Average Fleet is determined using a simple average of the number of vehicles at the beginning and end of a given period.

Corporate Restricted Cash (used in the calculation of Net Corporate Debt)

Total restricted cash includes cash and cash equivalents that are not readily available for our normal disbursements. Total restricted cash and equivalents are restricted for the purchase of revenue earning vehicles and other specified uses under our Fleet Debt facilities, our like-kind exchange programs and to satisfy certain of our self-insurance regulatory reserve requirements. Corporate restricted cash is calculated as total restricted cash less restricted cash associated with fleet debt.

Dollar Utilization

Dollar utilization means revenue derived from the rental of equipment divided by the original cost of the equipment including additional capitalized refurbishment costs (with the basis of refurbished assets at the refurbishment date).
 

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Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) and Corporate EBITDA

EBITDA is defined as net income before net interest expense, income taxes and depreciation (which includes revenue earning equipment lease charges) and amortization. Corporate EBITDA, as presented herein, represents EBITDA as adjusted for car rental fleet interest, car rental fleet depreciation and certain other items, as described in more detail in the accompanying schedules.

Management uses EBITDA and Corporate EBITDA as operating performance and liquidity metrics for internal monitoring and planning purposes, including the preparation of our annual operating budget and monthly operating reviews, as well as to facilitate analysis of investment decisions, profitability and performance trends. Further, EBITDA enables management and investors to isolate the effects on profitability of operating metrics such as revenue, operating expenses and selling, general and administrative expenses, which enables management and investors to evaluate our business segments that are financed differently and have different depreciation characteristics and compare our performance against companies with different capital structures and depreciation policies. We also present Corporate EBITDA as a supplemental measure because such information is utilized in the calculation of financial covenants under the Company's senior credit facilities and in the determination of certain executive compensation.

EBITDA and Corporate EBITDA are not recognized measurements under U.S. GAAP. When evaluating our operating performance or liquidity, investors should not consider EBITDA and Corporate EBITDA in isolation of, or as a substitute for, measures of our financial performance and liquidity as determined in accordance with GAAP, such as net income, operating income or net cash provided by operating activities.

Equipment Rental and Rental Related Revenue

Equipment rental and rental related revenue consists of all revenue, net of discounts, associated with the rental of equipment including charges for delivery, loss damage waivers and fueling, but excluding revenue arising from the sale of equipment, parts and supplies and certain other ancillary revenue. Rental and rental related revenue is adjusted in all periods to eliminate the effect of fluctuations in foreign currency. Our management believes eliminating the effect of fluctuations in foreign currency is appropriate so as not to affect the comparability of underlying trends. This statistic is important to our management and to investors as it reflects time and mileage and ancillary charges for equipment on rent and is comparable with the reporting of other industry participants.

Fleet Efficiency

Fleet efficiency is calculated by dividing total transaction days by the average fleet multiplied by the number of days in a period. Average fleet used to calculate fleet efficiency in our U.S. Car Rental segment excludes Advantage sublease and Hertz 24/7 vehicles as these vehicles do not have associated transaction days.

Fleet Growth

U.S. and International car rental fleet growth is defined as car rental fleet capital expenditures, net of proceeds from disposals, plus car rental fleet depreciation and net car rental fleet financing which includes borrowings, repayments and the change in fleet restricted cash. Worldwide equipment rental fleet growth is defined as worldwide equipment rental fleet expenditures, net of proceeds from disposals, plus depreciation.

Free Cash Flow

Free cash flow is calculated as net cash provided by operating activities, excluding depreciation of revenue earning equipment, net of car rental and equipment rental fleet growth and property and equipment net expenditures.  Free cash flow is important to management and investors as it represents the cash available for acquisitions and the reduction of corporate debt.

Net Corporate Debt

Net corporate debt is calculated as total debt excluding fleet debt less cash and equivalents and corporate restricted cash. Corporate debt consists of our Senior Term Facility; Senior ABL Facility; Senior Notes; Promissory Notes; Convertible Senior Notes; and certain other indebtedness of our domestic and foreign subsidiaries.


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Net Corporate Debt is important to management and investors as it helps measure our leverage. Net Corporate Debt also assists in the evaluation of our ability to service our non-fleet-related debt without reference to the expense associated with the fleet debt, which is collateralized by assets not available to lenders under the non-fleet debt facilities.

Net Depreciation Per Unit Per Month

Net depreciation per unit per month is calculated by dividing depreciation of revenue earning equipment and lease charges, net by the average fleet in each period and then dividing by the number of months in the period reported with all periods adjusted to eliminate the effect of fluctuations in foreign currency. Our management believes eliminating the effect of fluctuations in foreign currency is useful in analyzing underlying trends. Average fleet used to calculate net depreciation per unit per month in our U.S. Car Rental segment includes Advantage sublease and Hertz 24/7 vehicles as these vehicles have associated lease charges.

Restricted Cash Associated with Fleet Debt (used in the calculation of Net Fleet Debt and Corporate Restricted Cash)

Restricted cash associated with fleet debt is restricted for the purchase of revenue earning, vehicles and other specified uses under our Fleet Debt facilities and our car rental like-kind exchange program.

Same Store Revenue Growth/Decline

Same store revenue growth is calculated as the year over year change in revenue for locations that are open at the end of the period reported and have been operating under our direction for more than twelve months. The same-store revenue amounts are adjusted in all periods to eliminate the effect of fluctuations in foreign currency.

Our management believes eliminating the effect of fluctuations in foreign currency is appropriate so as not t o affect the comparability of underlying trends.

Time Utilization

Time utilization means the percentage of time an equipment unit is on-rent during a given period.

Total Net Debt

Total net debt is calculated as total debt less total cash and cash equivalents and total restricted cash. This measure is important to management, investors and ratings agencies as it helps measure our gross leverage.

Total RPD

Total RPD is calculated as total revenue less revenue from fleet subleases and ancillary revenue associated with retail car sales, divided by the total number of transaction days, with all periods adjusted to eliminate the effect of fluctuations in foreign currency. Our management believes eliminating the effect of fluctuations in foreign currency is appropriate so as not to affect the comparability of underlying trends. This statistic is important to our management and investors as it represents the best measurement of the changes in underlying pricing in the car rental business and encompasses the elements in car rental pricing that management has the ability to control.

Transaction Days

Transaction days represent the total number of 24-hour periods, with any partial period counted as one transaction day, that vehicles were on rent (the period between when a rental contract is opened and closed) in a given period. Thus, it is possible for a vehicle to attain more than one transaction day in a 24-hour period.


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HERC HOLDINGS INC Reports