H&E Equipment Services (HEES) 8-K H&E Equipment Services Reports Third Quarter 2008 Results

Exhibit 99.1

News Release

Contacts:

Leslie S. Magee
Chief Financial Officer
225-298-5261
lmagee@he-equipment.com

Kevin S. Inda
Corporate Communications, Inc.
407-566-1180
kevin.Inda@cci-ir.com

H&E Equipment Services Reports Third Quarter 2008 Results

BATON ROUGE, Louisiana — (Nov. 6, 2008) —H&E Equipment Services, Inc. (NASDAQ: HEES) today announced operating results for the third quarter ended September 30, 2008.

THIRD QUARTER 2008 SUMMARY

• Revenues increased 3.0% to $278.6 million versus $270.6 million a year ago, with the Company’s Mid-Atlantic acquisition contributing $38.8 million in the current quarter as compared to $10.1 million a year ago. Third quarter 2007 results reflected one month results from the acquisition which was completed September 1, 2007.

• EBITDA decreased 2.9% to $67.2 million compared to $69.2 million of EBITDA a year ago, with the Mid-Atlantic region contributing $3.4 million in the current quarter and $1.7 million a year ago.

• Income from operations decreased 12.3% to $37.2 million compared to $42.4 million a year ago, with the Mid-Atlantic region contributing $1.8 million of income from operations in the current quarter compared to $1.0 million a year ago. Depreciation and amortization expense increased $2.9 million.

• Net income decreased to $17.6 million, or $0.50 per diluted share, compared to $20.2 million, or $0.53 per diluted share. The effective income tax rate was 36.9% versus 39.4% a year ago.

“Our strong presence in regions with exposure to petrochemical, oil patch, mining and energy sectors and our integrated business model are clearly helping to minimize the impact to our business from the numerous macroeconomic issues occurring in the country today,” said John Engquist, H&E Equipment Services’ president and chief executive officer. “There is no doubt the non-residential construction industry has slowed as a result of the unstable credit markets and other economic factors, yet our strong presence in the industrial sector resulted in solid financial performance during the third quarter.”

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“We believe our business is very well positioned to navigate the current conditions in the market,” Engquist continued. “We have a strong balance sheet, are well capitalized and our debt carries a low interest rate and maturity dates well into the future. While we expect a difficult market to continue during the remainder of this year and into 2009 due to tight credit markets and economic slowdown, we are confident in our ability to make the necessary business adjustments to maximize our financial performance.”

“Although we are not seeing revenue growth as a result of the deterioration in the overall economy, our margins for this quarter improved on a sequential basis at the gross profit, EBIT, EBITDA and earnings per share level,” commented Leslie Magee, H&E Equipment Services’ chief financial officer. “Our product support business continues to show strength. This segment of our business has historically performed very well during periods of economic softness. We remain committed to reducing our capital fleet expenditures which will generate additional free cash flow. We plan to use excess cash to reduce debt and/or repurchase shares. With a challenging business climate, weakening visibility into future market demand, and times of uncertain access to credit, our focus continues to be cash generation and maintaining a strong, conservative balance sheet.”

FINANCIAL DISCUSSION FOR THIRD QUARTER 2008

Revenue

Total revenues grew 3.0% to $278.6 million from $270.6 million in the third quarter of 2008. Third quarter revenues included $38.8 million from the Mid-Atlantic region compared to $10.1 million a year ago, reflecting one month’s results of the acquisition which closed on September 1, 2007. Equipment rental revenues increased 3.4% to $78.2 million compared with $75.6 million in the third quarter of 2007. Third quarter 2008 equipment rental revenues included $4.5 million of rental revenues from the Mid-Atlantic region compared to $1.3 million a year ago. New equipment sales increased 3.3% to $97.8 million from $94.7 million due to new equipment sales of $20.5 million from the Mid-Atlantic region compared to $3.1 million of new equipment sales from the Mid-Atlantic region a year ago. Used equipment sales decreased 10.3% to $39.9 million compared to $44.5 million in the third quarter of 2007. The decrease in used equipment sales was partially offset by an increase in used sales from the Mid-Atlantic region to $6.4 million from $2.9 million a year ago. Parts sales grew 15.9% to $31.0 million from $26.7 million in the third quarter of 2007. Service revenues increased 8.6% to $18.3 million compared with $16.9 million in the third quarter of 2007. Product support revenue increased due to parts and service sales of $6.4 million in the Mid-Atlantic region compared to $2.7 million a year ago and increased demand.

Gross Profit

Gross profit decreased 1.7% to $82.5 million from $83.9 million in the third quarter of 2007. Gross margin was 29.6% for the quarter ended September 30, 2008 as compared to 31.0% for the quarter ended September 30, 2007. The reduced gross margin percentage in the current quarter is primarily due to the impact of a 16.9% gross margin on $38.8 million of revenues from the Mid-Atlantic operations. This lower gross margin is largely due to business mix, a continued challenging Mid-Atlantic market, and a lower margin rental segment in the Mid-Atlantic market due to fleet mix, utilization and rates. The gross profit contribution from the Mid-Atlantic region negatively impacted the Company’s consolidated gross margin by 210 basis points.

On a segment basis, gross margin on rentals decreased to 50.3% from 52.9% in the third quarter of 2007 due to increased depreciation costs, declines in rental rates and time utilization, and the impact from the Mid-Atlantic rental operations. On average and excluding rates in the

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Mid-Atlantic region, rental rates declined 2.0% as compared to the third quarter of 2007. Time utilization decreased to 67.4% from 70.7% a year ago.

Gross margins on new equipment sales were 13.4% as compared to 13.9% in the third quarter a year ago due to the mix of equipment sold. Gross margins on used equipment sales decreased to 23.3% from 24.2% a year ago due to lower margin on fleet sales in the Mid-Atlantic region. Gross margin on parts sales increased to 29.5% from 29.3%. Gross margin on service revenues increased to 64.0% from 63.7% in the third quarter of 2007 due to revenue mix.

Rental Fleet

At the end of the third quarter of 2008, the original acquisition cost of the Company’s rental fleet was $806.3 million, up $26.4 million from $779.9 million at the end of the third quarter of 2007. Dollar utilization was 38.8%, including results from the Mid-Atlantic region, compared to 41.9% for the third quarter of 2007. Dollar utilization for the three months ended September 30, 2008 was 39.8% excluding the Mid-Atlantic region. Dollar returns decreased reflecting lower year-over-year average rental rates and lower time utilization.

Selling, General and Administrative Expenses

SG&A expenses for the third quarter of 2008 were $45.6 million compared with $41.6 million last year, a $4.0 million, or 9.5%, increase. Third quarter SG&A expenses included $4.8 million from the Mid-Atlantic region. Costs have increased primarily due to labor and benefit costs to support the growth of the Company. SG&A expenses also grew by $0.6 million due to the amortization of intangibles associated with the acquisition in the Mid-Atlantic region. For the third quarter of 2008, SG&A expenses increased as a percentage of total revenues to 16.4% as compared with 15.4% last year.

Income from Operations

Income from operations for the third quarter of 2008 decreased 12.3% to $37.2 million compared with $42.4 million a year ago.

Interest Expense

Interest expense for the third quarter of 2008 increased $0.5 million to $9.5 million from $9.0 million primarily due to an increase in average borrowings on the Company’s senior secured credit facility.

Net Income

Net income decreased to $17.6 million, or $0.50 per diluted share, from $20.2 million, or $0.53 per diluted share. The effective income tax rate decreased to 36.9% in the third quarter of 2008 as compared to 39.4% last year.

EBITDA

EBITDA for the third quarter of 2008 decreased $2.0 million to $67.2 million from $69.2 million in the third quarter of 2007. EBITDA as a percentage of revenues was 24.1% compared with 25.6% in the third quarter of 2007. For the third quarter, the Mid-Atlantic region contributed $3.4 million of EBITDA, or an 8.8% EBITDA margin compared to $1.7 million of EBITDA, or a 16.8% EBITDA margin a year ago. Excluding the three month results from the Mid-Atlantic region, EBITDA margins increased to 26.6% for the third quarter of 2008 compared to 25.9% a year ago.

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2008 OUTLOOK

“In spite of today’s challenging and uncertain business environment, we are reaffirming our full year guidance for EBITDA and EPS and we are lowering our revenue guidance primarily to adjust for the expected delay in fourth quarter crane shipments,” said Engquist.

• Revenue— The Company now expects 2008 revenue in the range of $1.080 billion to $1.090 billion.

• EBITDA— The Company is narrowing its 2008 EBITDA to a range of $247 million to $253 million.

• Earnings Per Diluted Share —The Company is also narrowing its 2008 earnings per diluted share to a range of $1.60 to $1.68 based on an estimated 35.6 million diluted common shares outstanding and an estimated effective income tax rate of approximately 37.0%. The estimated diluted common shares outstanding reflect the impact of stock repurchases through October 31, 2008.

Non-GAAP Financial Measures

This press release contains certain Non-GAAP measures (EBITDA). Please refer to our Current Report on Form 8-K for a description of our use of these measures. EBITDA as calculated by the Company is not necessarily comparable to similarly titled measures reported by other companies. Additionally, these Non-GAAP measures are not measurements of financial performance or liquidity under GAAP and should not be considered as alternatives to the Company’s other financial information determined under GAAP.

Conference Call

The Company’s management will hold a conference call to discuss third quarter results today, November 6, 2008, at 10:00 a.m. (Eastern Time). To listen to the call, participants should dial 913-312-0411 approximately 10 minutes prior to the start of the call. A telephonic replay will become available after 1:00 p.m. (Eastern Time) on November 6, 2008, and will continue through November 14, 2008, by dialing 719-457-0820 and entering confirmation code 7320492.

The live broadcast of the Company’s quarterly conference call will be available online at www.he-equipment.com or www.earnings.com on November 6, 2008, beginning at 10:00 a.m. (Eastern Time) and will continue to be available for 30 days. Related presentation materials will be posted to the “Investor Relations” section of the Company’s web site at www.he-equipment.com prior to the call. The presentation materials will be in Adobe Acrobat format.

About H&E Equipment Services, Inc.

The Company is one of the largest integrated equipment services companies in the United States with 64 full-service facilities throughout the West Coast, Intermountain, Southwest, Gulf Coast, Mid-Atlantic and Southeast regions of the United States. The Company is focused on heavy construction and industrial equipment and rents, sells and provides parts and service support for four core categories of specialized equipment: (1) hi-lift or aerial platform equipment; (2) cranes; (3) earthmoving equipment; and (4) industrial lift trucks. By providing equipment rental, sales, and on-site parts, repair and maintenance functions under one roof, the Company is a one-stop provider for its customers’ varied equipment needs. This full service approach provides the Company with multiple points of customer contact, enabling it to maintain a high quality rental fleet, as well as an effective distribution channel for fleet disposal and provides cross-selling opportunities among its new and used equipment sales, rental, parts sales and service operations.

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Forward-Looking Statements

Certain statements in this press release are “forward-looking statements” within the meaning of the federal securities laws. Statements about our beliefs and expectations and statements containing the words “may,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project,” “intend” and similar expressions constitute forward-looking statements. Among the forward-looking statements included in this release is the information provided under the heading “2008 Outlook.” Forward-looking statements involve known and unknown risks and uncertainties, which could cause actual results that differ materially from those contained in any forward-looking statement. Such factors include, but are not limited to, the following: (1) general economic conditions and construction activity in the markets where we operate in North America and, in particular, the conditions in our Mid-Atlantic, Southern California and Florida regions as well as the impact of the current conditions of the capital markets and its effect on construction activity and the economy in general; (2) relationships with new equipment suppliers; (3) increased maintenance and repair costs; (4) our indebtedness; (5) the risks associated with the expansion of our business; (6) our possible inability to effectively integrate any businesses we acquire; (7) competitive pressures; (8) compliance with laws and regulations, including those relating to environmental matters; and (9) other factors discussed in our public filings, including the risk factors included in the Company’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Investors, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we are under no obligation to publicly update or revise any forward-looking statements after the date of this release.

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H&E EQUIPMENT SERVICES, INC.
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(Amounts in thousands, except per share amounts)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2008			2007			2008			2007
Revenues:
Equipment rentals	$	78,181		$	75,598		$	224,626		$	208,371
New equipment sales		97,797			94,675			274,135			240,910
Used equipment sales		39,873			44,503			128,436			110,190
Parts sales		30,951			26,716			89,112			73,803
Service revenues		18,333			16,877			52,651			46,599
Other		13,512			12,218			38,097			33,595
Total revenues		278,647			270,587			807,057			713,468
Cost of revenues:
Rental depreciation		26,362			24,468			78,838			68,132
Rental expense		12,514			11,173			36,460			33,802
New equipment sales		84,739			81,523			237,449			208,875
Used equipment sales		30,578			33,730			97,960			82,604
Parts sales		21,809			18,895			62,815			52,224
Service revenues		6,592			6,131			19,016			16,899
Other		13,556			10,768			38,735			30,112
Total cost of revenues		196,150			186,688			571,273			492,648
Gross profit		82,497			83,899			235,784			220,820
Selling, general, and administrative expenses		45,556			41,609			138,097			117,124
Gain on sale of property and equipment		219			97			515			444
Income from operations		37,160			42,387			98,202			104,140
Loss on early extinguishment of debt		—			(325	)		—			(325	)
Interest expense		(9,495	)		(9,007	)		(29,193	)		(26,597	)
Other income, net		250			293			731			816
Income before provision for income taxes		27,915			33,348			69,740			78,034
Provision for Income taxes		10,311			13,154			25,809			30,480
Net income	$	17,604		$	20,194		$	43,931		$	47,554
EARNINGS PER SHARE
Basic — Earnings per share	$	0.50		$	0.53		$	1.22		$	1.25
Basic — Weighted average number of common shares outstanding		35,075			38,095			35,912			38,090
Diluted — Earnings per share	$	0.50		$	0.53		$	1.22		$	1.25
Diluted — Weighted average number of common shares outstanding		35,090			38,095			35,918			38,090

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H&E EQUIPMENT SERVICES, INC.
SELECTED BALANCE SHEET DATA (unaudited)
(Amounts in thousands)

	September 30,		December 31,
	2008		2007
Cash	$	13,207	$	14,762
Rental equipment, net		582,347		577,628
Total assets		996,559		1,012,853
Total debt (1)		360,596		374,951
Total liabilities		706,127		724,775
Stockholders’ equity		290,432		288,078
Total liabilities and stockholders’ equity	$	996,559	$	1,012,853

⁽¹⁾ Total debt consists of the aggregate amounts outstanding on the senior secured credit facility, senior unsecured notes, capital lease obligation and notes payable obligations.

H&E EQUIPMENT SERVICES, INC.
UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Amounts in thousands)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2008		2007		2008		2007
Net income	$	17,604	$	20,194	$	43,931	$	47,554
Interest expense		9,495		9,007		29,193		26,597
Provision for income taxes		10,311		13,154		25,809		30,480
Depreciation		29,153		26,632		87,167		74,242
Amortization of intangibles		641		258		2,108		270
EBITDA	$	67,204	$	69,245	$	188,208	$	179,143

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