Herc Holdings Inc., an equipment rental supplier, announced at its Investor Day, strong progress toward the company’s three-year strategies, financial performance and capital allocation priorities set in 2021, and introduced new, three-year performance targets.

“In 2021, we laid out an ambitious plan to shift from a company focused on fortifying its foundation to a respected industry leader, focused on consistent, profitable share growth. Today, we are introducing new financial targets as we continue to leverage our organic strengths, invest in high-return areas of our business, and capitalize on secular and structural market opportunities,” said Larry Silber, President and Chief Executive Officer.

The company continues to expand its capabilities and invest in scale to deliver sustainable, long-term growth through a strategic set of initiatives to:

• Grow the core business: Increasing rental equipment fleet to scale at existing locations, while expanding the branch network through new greenfield additions and acquisitions in select markets.
• Expand its specialty equipment offering: Investing in specialty fleet and cross selling specialty services into core markets throughout North America.
• Elevate technology: Enhancing the customer experience by enabling mobile solutions and improving fleet-utilization tracking and logistics management.
• Integrate ESG: Advancing toward established 2030 goals for sustainability.
• Allocate capital: Operating against disciplined investment parameters for organic growth, strategic acquisitions, and dividends.

“Additionally, as we move into our next growth phase, we are introducing a new operating system called E3OS that will drive every aspect of our culture and performance. This system is about operational effectiveness and continuous improvement through standard processes, principles, practices, and tools to ensure we deliver the optimal customer experience at every touchpoint in the customer consumption chain as we continue to grow,” Silber said.

The company also introduced targets for organic rental revenue of 10 percent to 14 percent compound annual growth (CAGR) from 2024 through 2026, and established an organic adjusted EBITDA CAGR of 11 percent to 16 percent over the same period.

The company is continuing its focus on disciplined capital allocation priorities, including investing in fleet for organic growth, strategic M&A transactions, and continuing the quarterly dividend which will increase in line with long-term growth. Surplus capital will be deployed for additional investment in the business or returns to shareholders.

“We have never been better positioned to grow. We’ve never had a more resilient business model, and the market backdrop has never been stronger,” said Silber. “Herc has what it takes, across the board, to be successful in any operating environment. And we’re only getting better. We've got great capabilities. We've got a great brand. We've got great culture and talent. Our team has never worked better together and been more aligned on what we need to do collectively to be successful. Team Herc is our differentiating factor.”