Hertz Delays Quarterly Earnings on Accounting ReviewTom Lavell and Mark Clothier
Hertz Global Holdings Inc., the car-and equipment-rental company that’s splitting in two, delayed publishing its quarterly financial report as it continues reviewing accounts for the past three years.
Hertz wasn’t able to meet yesterday’s deadline, or a five-day extension period, for submitting its 10-Q form to the U.S. Securities and Exchange Commission because of a “previously announced thorough review of its internal financial records” for the three years through 2013, the Naples, Florida-based company said today in a filing.
The rental provider’s audit committee said in June that financial statements for 2011 need to be restated, affecting figures reported in the next two years. Errors emerged when Hertz was preparing first-quarter accounts, including in capitalization and depreciation timing for “certain non-fleet assets.” It also found mistakes in accounting for money it couldn’t collect from customers who damaged vehicles or equipment.
Hertz outlined plans in March to spin off its equipment-leasing business to focus on car rentals, creating two publicly traded companies. The rentals business will keep the name Hertz and get cash proceeds of about $2.5 billion to pay down debt and support a $1 billion share buyback, Hertz has said. The spun-off company will be called Hertz Equipment Rental Corp., or HERC, Hertz said in March.
Analysts had pressed executives to outline plans for the the unit, which rents bulldozers, backhoes and road graders, saying that it tied up capital Hertz could otherwise use to repay loans or pay dividends.
The shares rose 1.6 percent to $28.50 at the close in New York, leaving them down less than 1 percent this year.
Hertz, which operates the Dollar, Thrifty and Firefly brands, has more than 11,500 company and licensee locations in 145 countries. The company has been adding car-rental sites outside of airports in neighborhoods in a bid to win more business and leisure customers.