Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 22, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | HEES | |
Entity Registrant Name | H&E Equipment Services, Inc. | |
Entity Central Index Key | 0001339605 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 35,777,333 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
ASSETS | ||
Cash | $ 6,442 | $ 16,677 |
Receivables, net of allowance for doubtful accounts of $4,221 and $4,094, respectively | 188,343 | 201,556 |
Inventories, net of reserves for obsolescence of $272 and $368, respectively | 142,379 | 104,598 |
Prepaid expenses and other assets | 12,646 | 10,508 |
Rental equipment, net of accumulated depreciation of $607,306 and $582,520, respectively | 1,189,677 | 1,141,498 |
Property and equipment, net of accumulated depreciation and amortization of $144,604 and $142,662, respectively | 118,759 | 115,121 |
Operating lease right-of-use assets, net of accumulated amortization of $2,729 at March 31, 2019 | 166,293 | |
Finance lease right-of-use assets, net of accumulated amortization of $1,929 at March 31, 2019 | 487 | |
Deferred financing costs, net of accumulated amortization of $13,895 and $13,717, respectively | 3,347 | 3,000 |
Intangible assets, net of accumulated amortization of $4,272 and $3,320, respectively | 34,729 | 28,380 |
Goodwill | 142,490 | 105,843 |
Total assets | 2,005,592 | 1,727,181 |
Liabilities: | ||
Amounts due on senior secured credit facility | 265,647 | 170,761 |
Accounts payable | 115,494 | 101,840 |
Manufacturer flooring plans payable | 26,350 | 23,666 |
Accrued expenses payable and other liabilities | 61,622 | 73,371 |
Dividends payable | 93 | 132 |
Senior unsecured notes, net of unaccreted discount of $3,048 and $3,168 and deferred financing costs of $1,975 and $2,052, respectively | 944,977 | 944,780 |
Operating lease right-of-use liabilities | 168,579 | |
Finance lease right-of-use liabilities | 725 | |
Capital leases payable | 726 | |
Deferred income taxes | 158,090 | 153,113 |
Deferred compensation payable | 2,016 | 1,989 |
Total liabilities | 1,743,593 | 1,470,378 |
Commitments and Contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value, 25,000,000 shares authorized; no shares issued | ||
Common stock, $0.01 par value, 175,000,000 shares authorized; 39,808,072 and 39,748,562 shares issued at March 31, 2019 and December 31, 2018, respectively, and 35,778,807 and 35,733,569 shares outstanding at March 31, 2019 and December 31, 2018, respectively | 397 | 396 |
Additional paid-in capital | 232,362 | 231,174 |
Treasury stock at cost, 4,029,265 and 4,014,993 shares of common stock held at March 31, 2019 and December 31, 2018, respectively | (63,486) | (63,099) |
Retained earnings | 92,726 | 88,332 |
Total stockholders’ equity | 261,999 | 256,803 |
Total liabilities and stockholders’ equity | $ 2,005,592 | $ 1,727,181 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivables | $ 4,221 | $ 4,094 |
Reserves for obsolescence inventories | 272 | 368 |
Accumulated depreciation, rental equipment | 607,306 | 582,520 |
Accumulated depreciation and amortization, property and equipment | 144,604 | 142,662 |
Accumulated amortization, operating lease right-of-use assets | 2,729 | |
Accumulated amortization, finacing lease right-of-use assets | 1,929 | |
Accumulated amortization, deferred financing costs | 13,895 | 13,717 |
Accumulated amortization, intangible assets | 4,272 | 3,320 |
Unaccreted discount, net | 3,048 | 3,168 |
Deferred financing costs | $ 1,975 | $ 2,052 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 39,808,072 | 39,748,562 |
Common stock, shares outstanding | 35,778,807 | 35,733,569 |
Treasury stock, shares | 4,029,265 | 4,014,993 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues: | ||
Revenues | $ 313,638 | $ 260,482 |
Cost of revenues: | ||
Cost of revenues | 199,938 | 167,897 |
Gross profit | 113,700 | 92,585 |
Selling, general and administrative expenses | 78,647 | 65,880 |
Merger costs | 119 | 152 |
Gain on sales of property and equipment, net | 741 | 773 |
Income from operations | 35,675 | 27,326 |
Other income (expense): | ||
Interest expense | (16,855) | (14,653) |
Other, net | 532 | 395 |
Total other expense, net | (16,323) | (14,258) |
Income before provision for income taxes | 19,352 | 13,068 |
Provision for income taxes | 5,109 | 3,590 |
Net income | $ 14,243 | $ 9,478 |
Net income per common share: | ||
Basic | $ 0.40 | $ 0.27 |
Diluted | $ 0.40 | $ 0.26 |
Weighted average common shares outstanding: | ||
Basic | 35,787 | 35,592 |
Diluted | 35,973 | 35,879 |
Dividends declared per common share outstanding | $ 0.275 | $ 0.275 |
Equipment Rentals [Member] | ||
Revenues: | ||
Revenues | $ 176,129 | $ 137,038 |
Cost of revenues: | ||
Cost of revenues | 98,191 | 79,841 |
Gross profit | 77,938 | 57,197 |
Equipment Rentals [Member] | Rentals Other [Member] | ||
Cost of revenues: | ||
Cost of revenues | 16,275 | 12,100 |
Equipment Rentals [Member] | Rental Depreciation [Member] | ||
Cost of revenues: | ||
Cost of revenues | 57,148 | 46,469 |
Equipment Rentals [Member] | Rental Expense [Member] | ||
Cost of revenues: | ||
Cost of revenues | 24,768 | 21,272 |
New Equipment Sales [Member] | ||
Revenues: | ||
Revenues | 59,103 | 46,493 |
Cost of revenues: | ||
Cost of revenues | 52,099 | 40,845 |
Gross profit | 7,004 | 5,648 |
Used Equipment Sales [Member] | ||
Revenues: | ||
Revenues | 29,634 | 24,853 |
Cost of revenues: | ||
Cost of revenues | 19,012 | 16,937 |
Gross profit | 10,622 | 7,916 |
Parts Sales [Member] | ||
Revenues: | ||
Revenues | 30,428 | 28,151 |
Cost of revenues: | ||
Cost of revenues | 22,289 | 20,617 |
Gross profit | 8,139 | 7,534 |
Services Revenues [Member] | ||
Revenues: | ||
Revenues | 15,568 | 15,036 |
Cost of revenues: | ||
Cost of revenues | 5,004 | 5,050 |
Gross profit | 10,564 | 9,986 |
Other [Member] | ||
Revenues: | ||
Revenues | 2,776 | 8,911 |
Cost of revenues: | ||
Cost of revenues | 3,343 | 4,607 |
Gross profit | $ (567) | $ 4,304 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 14,243 | $ 9,478 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization of property and equipment | 6,479 | 5,884 |
Depreciation of rental equipment | 57,148 | 46,469 |
Amortization of finance lease right-of-use assets | 41 | |
Amortization of intangible assets | 952 | 705 |
Amortization of deferred financing costs | 254 | 289 |
Accretion of note discount, net of premium amortization | 120 | 120 |
Operating right-of-use lease liabilities, net | 146 | |
Provision for losses on accounts receivable | 1,301 | 817 |
Provision for inventory obsolescence | 42 | 67 |
Change in deferred income taxes | 4,977 | 4,456 |
Stock-based compensation expense | 1,188 | 1,319 |
Gain from sales of property and equipment, net | (741) | (773) |
Gain from sales of rental equipment, net | (10,621) | (7,745) |
Changes in operating assets and liabilities, net of acquisitions: | ||
Receivables | 17,605 | 22,414 |
Inventories | (58,062) | (88,674) |
Prepaid expenses and other assets | (2,117) | (2,237) |
Accounts payable | 13,539 | 45,384 |
Manufacturer flooring plans payable | 2,684 | 6,110 |
Accrued expenses payable and other liabilities | (10,137) | (15,799) |
Deferred compensation payable | 27 | 22 |
Net cash provided by operating activities | 39,068 | 28,306 |
Cash flows from investing activities: | ||
Acquisition of businesses, net of cash acquired | (106,746) | (125,207) |
Purchases of property and equipment | (7,221) | (4,505) |
Purchases of rental equipment | (48,644) | (40,654) |
Proceeds from sales of property and equipment | 931 | 785 |
Proceeds from sales of rental equipment | 28,292 | 23,430 |
Net cash used in investing activities | (133,388) | (146,151) |
Cash flows from financing activities: | ||
Borrowings on senior secured credit facility | 447,503 | 294,229 |
Payments on senior secured credit facility | (352,617) | (294,229) |
Dividends paid | (9,832) | (9,804) |
Purchases of treasury stock | (387) | |
Payments of deferred financing costs | (525) | (88) |
Payments of finance lease obligations | (57) | |
Payments of capital lease obligations | (57) | |
Net cash provided by (used in) financing activities | 84,085 | (9,949) |
Net decrease in cash | (10,235) | (127,794) |
Cash, beginning of period | 16,677 | 165,878 |
Cash, end of period | 6,442 | 38,084 |
Noncash asset purchases: | ||
Assets transferred from new and used inventory to rental fleet | 21,112 | 15,414 |
Purchases of property and equipment included in accrued expenses payable and other liabilities | 345 | (23) |
Operating lease right-of-use assets and lease liabilities recorded upon adoption of ASC 842 | 162,814 | |
Finance lease right-of-use assets and lease liabilities recorded upon adoption of ASC 842 | 782 | |
Operating lease assets obtained in exchange for new operating lease liabilities | 8,370 | |
Cash paid during the period for: | ||
Interest | 29,481 | 28,633 |
Income taxes paid (net of refunds received) | $ (519) | $ (16) |
Organization and Nature of Oper
Organization and Nature of Operations | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Nature of Operations | (1) Organization and Nature of Operations Basis of Presentation Our condensed consolidated financial statements include the financial position and results of operations of H&E Equipment Services, Inc. and its wholly-owned subsidiaries H&E Finance Corp., GNE Investments, Inc., Great Northern Equipment, Inc., H&E California Holding, Inc., H&E Equipment Services (California), LLC and H&E Equipment Services (Mid-Atlantic), Inc., collectively referred to herein as “we” or “us” or “our” or the “Company.” The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such regulations. In the opinion of management, all adjustments (consisting of all normal and recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019, and therefore, the results and trends in these interim condensed consolidated financial statements may not be the same for the entire year. These interim condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 31, 2018, from which the consolidated balance sheet amounts as of December 31, 2018 were derived. All significant intercompany accounts and transactions have been eliminated in these condensed consolidated financial statements. Business combinations accounted for as purchases are included in the condensed consolidated financial statements from their respective dates of acquisition. The nature of our business is such that short-term obligations are typically met by cash flows generated from long-term assets. Consequently, and consistent with industry practice, the accompanying condensed consolidated balance sheets are presented on an unclassified basis. Historically, we have presented hauling revenues and related cost of sales associated with our equipment rental activities within Other Revenues and Other Cost of Sales. This presentation did not change upon our adoption of Topic 606 on January 1, 2018 as hauling activities are deemed a separate performance obligation under Topic 606 and SEC Regulation S-X permitted flexibility in the presentation of such revenues . However, given the presentation changes of certain ancillary fees required by Topic 842 as described in note 2 to these condensed consolidated financial statements, we believe that including equipment rental hauling revenues and related costs of sales within our Rental Revenues segment results in a more meaningful presentation and analysis of our equipment rental activities. In accordance with SEC Regulation S-X , the reclassification of equipment rental hauling revenues and related cost of sales from Other Revenues and Other Cost of Sales to Rental Revenues and Rental Other Cost of Sales is presented on a retrospective basis, meaning our condensed consolidated statements of income for the three month periods ended March 31, 2019 and 2018 include hauling revenues and related costs of sales presented within Equipment Rental Revenues and Rental Other Cost of Sales. The table below reconciles for the three month period ended March 31, 2018, our Revenues, Cost of Revenues and Gross Profit as previously reported to the current period presentation in this Quarterly Report on Form 10-Q. $'s in thousands Three Month Period Ended March 31, 2018 As Previously Reported Hauling Fees As Currently Reported REVENUES Equipment rentals $ 129,361 $ 7,677 $ 137,038 New equipment sales 46,493 - 46,493 Used equipment sales 24,853 - 24,853 Parts sales 28,151 - 28,151 Services revenues 15,036 - 15,036 Other 16,588 (7,677) 8,911 Total revenues 260,482 - 260,482 COST OF REVENUES Rental depreciation 46,469 - 46,469 Rental expense 21,272 - 21,272 Rental other - 12,100 12,100 67,741 12,100 79,841 New equipment sales 40,845 - 40,845 Used equipment sales 16,937 - 16,937 Parts sales 20,617 - 20,617 Services revenues 5,050 - 5,050 Other 16,707 (12,100) 4,607 Total cost of revenues 167,897 - 167,897 Gross Profit $ 92,585 $ - $ 92,585 Nature of Operations As one of the largest integrated equipment services companies in the United States focused on heavy construction and industrial equipment, we rent, sell and provide parts and services support for four core categories of specialized equipment: (1) hi-lift or aerial work platform equipment; (2) cranes; (3) earthmoving equipment; and (4) industrial lift trucks. By providing equipment rental, sales, on-site parts, repair and maintenance functions under one roof, we are a one-stop provider for our customers’ varied equipment needs. This full service approach provides us with multiple points of customer contact, enables us to maintain a high quality rental fleet, as well as an effective distribution channel for fleet disposal and provides cross‑selling opportunities among our new and used equipment sales, rental, parts sales and services operations. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | (2) Significant Accounting Policies We describe our significant accounting policies in note 2 of the notes to consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2018. During the three month period ended March 31, 2019, there were no significant changes to those accounting policies, other than those policies impacted by our adoption of the new lease accounting standard , which is further described below in “Recent Accounting Pronouncements Adopted in Fiscal 201 9 ”. Use of Estimates We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, which requires management to use its judgment to make estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. These assumptions and estimates could have a material effect on our condensed consolidated financial statements. Actual results may differ materially from those estimates. We review our estimates on an ongoing basis based on information currently available, and changes in facts and circumstances may cause us to revise these estimates. Recent Accounting Pronouncements Pronouncements Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, “ Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other – Internal-Use Software In August 2018, the FASB issued ASU No. 2018-13, " Fair Value Measurement - Disclosure Framework, Recently Adopted Accounting Pronouncements Leases We adopted ASU No. 2016-02, Leases Lessor Accounting Our equipment rental business involves rental contracts with customers whereby we are the lessor in the transaction and therefore, we believe that such transactions are subject to Topic 842. We account for such rental contracts as operating leases pursuant to Topic 842, as well as pursuant to previous lease accounting guidance (Topic 840) in effect for periods prior to the effective date of Topic 842. In accordance with Topic 842, certain ancillary fees that we charge our equipment rental customers result in a different presentation within our consolidated statements of income compared to our historical presentation of those items under previous lease accounting guidance. Specifically, amounts we charge our customers for loss damage waiver fees, environmental fees, and fuel and other recovery fees, upon adoption of Topic 842, are to be included within our Equipment Rentals segment rather than included within non-segmented Other Revenues as we have historically presented those items under previous lease accounting guidance. Likewise, the related cost of goods sold for these ancillary items under Topic 842 are to be presented within our Equipment Rentals segment rather than included in non-segmented Other Cost of Goods Sold as we have historically presented under previous lease accounting guidance. We adopted Topic 842 on January 1, 2019 using the transition method that allowed us to initially apply Topic 842 as of January 1, 2019 and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. As such, Topic 842 will not be applied to periods prior to January 1, 2019. Therefore, the above changes as described are not reflected in our condensed consolidated statements of income for the three month period ended March 31, 2018. While the above changes resulting from our adoption of Topic 842 do not impact total consolidated revenues or total consolidated gross profit, the change does impact the comparability of our total Rental Revenues and total Other Revenues gross profit and resulting gross margins for 2019 compared to our previously reported gross profit and resulting gross margins for periods prior to January 1, 2019. Lessee Accounting Topic 842 requires leases with durations greater than twelve months to be recognized on the balance sheet. We adopted Topic 842 using the modified retrospective approach with an effective date as of the beginning of our fiscal year, January 1, 2019. Therefore, prior year financial statements were not recast under the new standard. We recognized an adjustment of less than $0.1 million to retained earnings upon adoption of Topic 842. We elected the package of transition provisions available for expired or existing leases, which allowed us to carryforward our historical assessments of (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. We did not elect the use-of-hindsight practical expedient or the practical expedient pertaining to land easements. We elected not to apply Topic 842 to arrangements with lease terms of 12 months or less. The adoption of Topic 842 had a material impact on our consolidated balance sheet related to operating leases. Upon adoption of Topic 842, we recognized additional operating lease liabilities, net of deferred rent, of $162.8 million. We also recognized corresponding right-of-use operating lease assets of $162.8 million. Finance lease liabilities recognized upon adoption of Topic 842 were $0.8 million and finance right-of-use lease assets were $0.5 million. Topic 842 significantly expanded the disclosure requirements related to our leasing activities. Additional information and disclosures required by Topic 842 are presented in note 10 to these condensed consolidated financial statements. Revenue Recognition In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Entities may use a full retrospective approach or report on the cumulative effect as of the date of adoption. We adopted this standard effective January 1, 2018 using the full retrospective transition method. As described above and in note 10 to these condensed consolidated financial statements, we adopted Topic 842 on January 1, 2019. We recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 842. Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. Our contracts with customers generally do not include multiple performance obligations. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services. In the table below, revenue as presented in our condensed consolidated statement of income for the three month period ended March 31, 2019 and 2018 is summarized by type and by the applicable accounting standard. Three Month Period Ended March 31, 2019 2018 Topic 842 Topic 606 Total Topic 840 Topic 606 Total Revenues: Rental revenues Owned equipment rentals $ 153,350 $ 274 $ 153,624 $ 123,734 $ 522 $ 124,256 Re-rent revenue 6,036 ─ 6,036 5,105 ─ 5,105 Ancillary and other rental revenues: Delivery and pick-up ─ 8,982 8,982 ─ 7,677 7,677 Other 7,487 ─ 7,487 ─ ─ ─ Total ancillary rental revenues 7,487 8,982 16,469 ─ 7,677 7,677 Total equipment rental revenues 166,873 9,256 176,129 128,839 8,199 137,038 New equipment sales ─ 59,103 59,103 ─ 46,493 46,493 Used equipment sales ─ 29,634 29,634 ─ 24,853 24,853 Parts sales ─ 30,428 30,428 ─ 28,151 28,151 Service revenues ─ 15,568 15,568 ─ 15,036 15,036 Other ─ 2,776 2,776 6,267 2,644 8,911 Total revenues $ 166,873 $146,765 $ 313,638 $ 135,106 $ 125,376 $ 260,482 Revenues by reporting segment are presented in note 11 of our condensed consolidated financial statements, using the revenue captions reflected in our consolidated statements of income. We believe that the disaggregation of our revenues from contracts to customers as reflected above, coupled with further discussion below and the reporting segments in note 11, depict how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by economic factors. Lease revenues (Topic 842) Owned Equipment Rentals: Owned equipment rentals represent revenues from renting equipment. We account for these rental contracts as operating leases. We recognize revenue from equipment rentals in the period earned, regardless of the timing of billing to customers. A rental contract includes rates for daily, weekly or monthly use, and rental revenues are earned on a daily basis as rental contracts remain outstanding. Because the rental contracts can extend across multiple reporting periods, we record unbilled rental revenues and deferred rental revenues at the end of reporting periods so rental revenues earned is appropriately stated for the periods presented. Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above. “Other” equipment rental revenue is primarily comprised of (i) revenue from customers who purchase insurance to protect against potential damages or loss the equipment they rent, (ii) environmental charges associated with the rental of equipment, and (iii) fuel recovery fees charged to customers. Fuel consumption charges are recognized upon return of the rental equipment when fuel consumption by the customer, if any, can be measured. Income from environmental fees and damage waiver insurance policies are recognized when earned over the period the equipment is rented. Prior to our adoption of Topic 842 on January 1, 2019, these revenue items were included in other revenues as shown in the table above for the three month period ended March 31, 2018. Revenues from contracts with customers (Topic 606) The accounting for the types of revenues accounted for pursuant to Topic 606 are discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time. Rental revenues: An insignificant portion of our total equipment rental revenues are recognized pursuant to Topic 606 rather than pursuant to Topic 842. These revenues represent services performed by us in connection with the rental of equipment and are comprised of customer training fees on rented equipment and erection and dismantling services on rental equipment. Revenues for these services are recognized upon completion of such services. See discussion above regarding rental revenues recognized pursuant to Topic 842. Delivery and pick-up : Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed. New equipment sales: Revenues from the sales of new equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Used equipment sales: Revenues from the sales of used equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Parts sales: Revenues from the sales of equipment parts are recognized at the time of pick-up by the customer for parts counter sales transactions. For parts that are shipped to a customer, we elected to use a practical expedient of Topic 606 and treat such shipping activities as fulfillment costs, thereby recognizing revenues at the time of shipment. Services revenues: We derive our services primarily from maintenance and repair services to customers for their owned equipment. We recognize services revenues at the time such services are completed, which is when the customer obtains control of the promised service. Other revenues : Other revenues relate primarily to hauling fees for transporting equipment sold to and from the customer and ancillary charges associated with equipment maintenance and repair services. Such revenues are recognized at the time the services are performed. Receivables and contract assets and liabilities We manage credit risk associated with our accounts receivables at the customer level. Because the same customers typically generate the revenues that are accounted for under both Topic 606 and Topic 842, the discussions below on credit risk and our allowance for doubtful accounts address our total revenues from Topic 606 and Topic 842. We believe concentration of credit risk with respect to our receivables is limited because our customer base is comprised of a large number of geographically diverse customers. No single customer accounted for more than 10% of our revenues on an overall or segment basis for any of the periods presented in this Quarterly Report on Form 10-Q. We manage credit risk through credit approvals, credit limits and other monitoring procedures. We maintain an allowance for doubtful accounts that reflects our estimate of the amount of our receivables that we will be unable to collect. We develop our estimate of this allowance based on our historical experience with specific customers, our understanding of our current economic circumstances and our own judgment as to the likelihood of ultimate payment. Our largest exposure to doubtful accounts is in our rental operations. We perform credit evaluations of customers and establish credit limits based on reviews of our customers’ current credit information and payment histories. We believe our credit risk is somewhat mitigated by our geographically diverse customer base and our credit evaluation procedures. During the year, we write-off customer account balances when we have exhausted reasonable collection efforts and determined that the likelihood of collection is remote. Such write-offs are charged against our allowance for doubtful accounts. Bad debt expense as a percentage of total revenues for the three month periods ended March 31, 2019 and 2018 were approximately 0.4% and 0.3%, respectively. The actual rate of future credit losses, however, may not be similar to past experience. Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance for doubtful accounts. We do not have material contract assets, impairment losses associated therewith, or material contract liabilities associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenues during the three month periods ended March 31, 2019 or 2018 that was included in the contract liability balance as of the beginning of such periods. Performance obligations Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amount of such revenue recognized during the three month periods ended March 31, 2019 and 2018 was not material. We also do not expect to recognize material revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2019. Payment terms Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk. Sales tax amounts collected from customers are recorded on a net basis. Contract costs We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. Contract estimates and judgments Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments as the transaction price is generally fixed and stated on our contracts. Our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation. Also, our revenues do not include material amounts of variable consideration. Substantially all of our revenues are recognized at a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenues are generally recognized at the time of delivery to, or pick-up by, the customer. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | (3) Acquisitions 2018 Acquisitions Contractors Equipment Center (“CEC”) Effective January 1, 2018, we completed the acquisition of CEC, a non-residential construction focused equipment rental company with three branches located in the greater Denver, Colorado area. The acquisition significantly expands our presence in the Denver area and surrounding markets. The aggregate consideration paid to the pre-acquisition owners of CEC was approximately $132.4 million. The acquisition and related fees and expenses were funded through available cash. The following table summarizes the fair values of the assets acquired and liabilities assumed as of the acquisition date. $’s in thousands Cash $ 1,244 Accounts receivable 7,583 Inventory 504 Prepaid expenses and other assets 324 Rental equipment 55,342 Property and equipment 2,700 Intangible assets (1) 21,500 Total identifiable assets acquired 89,197 Accounts payable (1,023) Accrued expenses payable and other liabilities (876) Total liabilities assumed (1,899) Net identifiable assets acquired 87,298 Goodwill (2) 45,092 Net assets acquired $ 132,390 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 21,000 10 Tradenames 300 1 Leasehold interests 200 10 $ 21,500 (2) We have allocated the $45.1 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $25,233 Rental Component 2 18,391 New Equipment 217 Used Equipment 632 Parts 379 Service 240 The level of goodwill that resulted from the CEC acquisition is primarily reflective of CEC’s going-concern value, the value of CEC’s assembled workforce, new customer relationships expected to arise from the acquisition and expected synergies from combining operations. We currently expect the goodwill recognized to be 100% deductible for income tax purposes. Total CEC acquisition costs were $1.0 million. Since our acquisition of CEC on January 1, 2018, significant amounts of equipment rental fleet have been moved between H&E locations and the acquired CEC locations, and it is impractical to reasonably estimate the amount of CEC revenues and earnings since the acquisition date. Rental, LLC (dba “Rental Inc.”) Effective April 1, 2018, we completed the acquisition of Rental Inc., a non-residential equipment rental and distribution company with five branches located in Alabama, Florida and Western Georgia. The acquisition expands our presence in the surrounding markets. The aggregate consideration paid to the owners of Rental Inc. was approximately $68.6 million. The acquisition and related fees and expenses were funded through available cash and from borrowings under our Credit Facility (as defined below). The following table summarizes the fair value of the assets acquired and liabilities assumed as of the acquisition date. $’s in thousands Cash $ 260 Accounts receivable 2,873 Inventory 5,324 Prepaid expenses and other assets 47 Rental equipment 22,578 Property and equipment 1,935 Intangible assets (1) 10,200 Total identifiable assets acquired 43,217 Accounts payable (439) Manufacturer flooring plans payable (3,293) Accrued expenses payable and other liabilities (469) Total liabilities assumed (4,201) Net identifiable assets acquired 39,016 Goodwill (2) 29,554 Net assets acquired $ 68,570 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 10,000 10 Tradenames 200 1 $ 10,200 (2) We have allocated the $29.6 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $9,064 Rental Component 2 5,445 New Equipment 10,217 Used Equipment 1,692 Parts 2,171 Service 964 Included in the total goodwill amount of $29.6 million is approximately $3.4 million of accrued purchase price consideration that is to be paid to the sellers pursuant to the terms of the purchase agreement among the parties named thereto. The level of goodwill that resulted from the Rental Inc. acquisition is primarily reflective of Rental Inc.’s going-concern value, the value of Rental Inc.’s assembled workforce, new customer relationships expected to arise from the acquisition and expected synergies from combining operations. We currently expect the goodwill recognized to be 100% deductible for income tax purposes. Total Rental Inc. acquisition costs were approximately $0.3 million. Since our acquisition of Rental Inc. on April 1, 2018, significant amounts of equipment rental fleet have been moved between H&E locations and the acquired Rental Inc. locations, and it is impractical to reasonably estimate the amount of Rental Inc. revenues and earnings since the acquisition date. 2019 Acquisition Cobra Equipment Rentals LLC (dba “We-Rent-It”) Effective February 1, 2019, we completed the acquisition of We-Rent-It (“WRI”), an equipment rental company with six branches located in central Texas. The acquisition expands our presence in the surrounding markets. The aggregate consideration paid to the owners of WRI was approximately $108.5 million. The acquisition and related fees and expenses were funded from borrowings under our Credit Facility (defined below). The following table summarizes the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date. The amounts presented below are preliminary and are subject to change. $’s in thousands Cash $ 1,745 Accounts receivable 5,149 Inventory 873 Prepaid expenses and other assets 544 Rental equipment 53,242 Property and equipment 3,959 Other assets 21 Intangible assets (1) 7,300 Total identifiable assets acquired 72,833 Accounts payable (115) Accrued expenses payable and other liabilities (874) Total liabilities assumed (989) Net identifiable assets acquired 71,844 Goodwill 36,647 Net assets acquired $ 108,491 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 7,300 10 The analysis of assigning the above $36.6 million goodwill among our six goodwill reporting units has not been finalized. The level of goodwill that resulted from the WRI acquisition is primarily reflective of WRI’s going-concern value, the value of WRI’s assembled workforce, new customer relationships expected to arise from the acquisition and expected synergies from combining operations. We currently expect the goodwill recognized to be 100% deductible for income tax purposes. Total WRI acquisition costs were $0.3 million. Total revenues attributable to WRI since the February 1, 2019 acquisition were $5.9 million for the three month period ended March 31 2019. Estimated net income attributable to WRI since the acquisition was approximately $0.8 million, or $0.02 per share, for the three month period ended March 31, 2019. It should be noted that as we integrate WRI into H&E’s operations, significant amounts of rental fleet will be moved between H&E locations and WRI locations, such that reasonably estimating WRI acquisition revenues and earnings will likely become impractical to do. Pro forma financial information We completed the CEC acquisition on January 1, 2018. Therefore, the operating results of CEC are included in our reported condensed consolidated statements of income for the full three month periods ended March 31, 2019 and 2018. We completed the Rental Inc. acquisition on April 1, 2018. Therefore, our reported condensed consolidated statements of income for the three month period ended March 31, 2018 do not include Rental Inc. for the period January 1, 2018 through March 31, 2018. We completed the We-Rent-It acquisition on February 1, 2019. Therefore, our reported condensed consolidated statements includes We-Rent-It for the period of February 1, 2019 through March 31, 2019. Pursuant to ASC 805, pro forma disclosures should be repeated whenever the year or interim period of the acquisition is presented. Since the CEC acquisition was completed in the first quarter of 2018, the pro forma information below gives effect to the CEC acquisition as if the acquisition occurred on January 1, 2017 (the CEC pro forma acquisition date) for the three month period ended March 31, 2017. (amounts in thousands) Three Month Period Ended March 31, 2017 H&E CEC Total Total revenues (1) $ 226,828 $ 8,389 $ 235,217 Pretax income 8,530 1,441 9,971 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (2) (903) (903) Intangible asset amortization (3) (705) (705) Pro forma pretax income (loss) 8,530 (167) 8,363 Income tax expense (benefit) 3,140 (63) 3,077 Net income (loss) $ 5,390 $ (104) $ 5,286 Net income per share - basic $ 0.15 $ ─ $ 0.15 Net income per share – diluted $ 0.15 $ ─ $ 0.15 (1) There were no nonrecurring pro forma adjustments directly attributable to the CEC acquisition included in the reported pro forma total revenues. (2) Depreciation of rental equipment and non-rental equipment were adjusted for the fair value markups, and the changes in useful lives and salvage values of the equipment acquired in the CEC acquisition. (3) Represents the amortization of the intangible assets acquired in the CEC acquisition. The pro forma information below gives effect to the WRI acquisition as if it had been completed on January 1, 2018 (the WRI pro forma acquisition date). Because the Rental Inc. acquisition occurred in the second quarter of 2018 and the acquisition is not included in our condensed consolidated statements of income for the three month period March 31, 2018, pro forma information, pursuant to ASC 805, is not required to be presented in this Quarterly Report on Form 10-Q. The pro forma information below is not necessarily indicative of our results of operations had the acquisitions been completed on the above date, nor is it necessarily indicative of our future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisitions, nor does it reflect additional revenue opportunities following the acquisition. The pro forma adjustments reflected in the table below are subject to change as additional analysis is performed. The tables below present unaudited pro forma consolidated statements of income information for the three month period ended March 31, 2018 as if WRI w as included in our consolidated results for the entire period presented. (amounts in thousands, except per share data) Three Month Period Ended March 31, 2018 H&E(1) We-Rent-It Total Total revenues $260,482 $7,587 $268,069 Pretax income 13,068 784 13,852 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (2) — (250) (250) Intangible asset amortization (3) — (122) (122) Interest expense (4) — (1,356) (1,356) Elimination of historic interest expense (5) — 80 80 Pro forma pretax income (loss) 13,068 (864) 12,204 Income tax expense (benefit) 3,590 (235) 3,355 Net income (loss) $ 9,478 $ (629) $8,849 Net income (loss) per share – basic $ 0.27 $(0.02) $ 0.25 Net income (loss) per share - diluted $ 0.26 $(0.02) $ 0.25 (1) Amounts presented above for “H&E” are derived from the Company’s consolidated statements of income in this Quarterly Report on Form 10-Q for the three month period ended March 31, 2018. (2) Depreciation of rental equipment and non-rental equipment were adjusted for the fair value markups, and the changes in useful lives and salvage values of the equipment acquired in the acquisition. (3) Represents the amortization of the intangible asset acquired in the acquisition. (4) Interest expense was adjusted to reflect the additional debt resulting from the acquisition. (5) Represents the elimination of historic debt of WRI that is not part of the combined entity. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | (4) Fair Value of Financial Instruments Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The FASB fair value measurement guidance established a fair value hierarchy that prioritizes the inputs used to measure fair value. The three broad levels of the fair value hierarchy are as follows: Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 – Quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly Level 3 – Unobservable inputs for which little or no market data exists, therefore requiring a company to develop its own assumptions The carrying value of financial instruments reported in the accompanying condensed consolidated balance sheets for cash, accounts receivable, accounts payable and accrued expenses payable and other liabilities approximate fair value due to the immediate or short-term nature or maturity of these financial instruments. The fair value of our letter of credit is based on fees currently charged for similar agreements. The carrying amounts and fair values of our other financial instruments subject to fair value disclosures as of March 31, 2019 and December 31, 201 8 are presented in the table below (amounts in thousands) and have been calculated based upon market quotes and present value calculations based on market rates. March 31, 2019 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) $ 26,350 $ 22,281 Senior unsecured notes with interest computed at 5.625% (Level 2) 944,977 947,625 Letter of credit (Level 3) — 97 December 31, 2018 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) $ 23,666 $ 19,870 Senior unsecured notes with interest computed at 5.625% (Level 2) 944,780 871,625 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 726 330 Letter of credit (Level 3) — 116 During the three month period ended March 31, 2019 and 2018, there were no transfers of financial assets or liabilities in or out of Level 1, Level 2 or Level 3 of the fair value hierarchy. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | (5) Stockholders’ Equity The following table summarizes the activity in Stockholders’ Equity for the three month period ended March 31, 2019 and March 31, 2018, respectively (amounts in thousands, except share data): Common Stock Additional Total Shares Issued Amount Paid-in Capital Treasury Stock Retained Earnings Stockholders’ Equity Balances at December 31, 2018 39,748,562 $ 396 $ 231,174 $ (63,099 ) $ 88,332 $ 256,803 Stock-based compensation — — 1,188 — — 1,188 Cash dividends declared on common stock ($0.275 per share) — — — — (9,793 ) (9,793 ) Issuance of common stock, net of forfeitures 59,510 1 — — 1 Repurchase of 14,272 shares of restricted common stock — — — (387 ) — (387 ) Cumulative effect adjustment pursuant to the adoption of ASC 842 — — — — (56 ) (56 ) Net income — — — — 14,243 14,243 Balances at March 31, 2019 39,808,072 $ 397 $ 232,362 $ (63,486 ) $ 92,726 $ 261,999 Balances at December 31, 2017 39,623,773 $ 395 $ 227,070 $ (61,749 ) $ 51,077 $ 216,793 Stock-based compensation — — 1,319 — — 1,319 Cash dividends declared on common stock ($0.275 per share) — — — — (9,845 ) (9,845 ) Issuance of common stock, net of forfeitures 9,534 — — — — — Net income — — — — 9,478 9,478 Balances at March 31, 2018 39,633,307 $ 395 $ 228,389 $ (61,749 ) $ 50,710 $ 217,745 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | (6) Stock-Based Compensation We account for our stock-based compensation plans using the fair value recognition provisions of Accounting Standards Codification (“ASC”) 718, Stock Compensation Non-vested Stock The following table summarizes our non-vested stock activity for the nine months ended March 31, 2019: Number of Shares Weighted Average Grant Date Fair Non-vested stock at December 31, 2018 379,559 $ 25.87 Granted 20,923 $ 26.77 Vested (57,296 ) $ 21.60 Forfeited (25,120 ) $ 19.80 Non-vested stock at March 31, 2019 318,066 $ 27.18 As of March 31, 2019, we had unrecognized compensation expense of approximately $4.2 million related to non-vested stock that we expect to be recognized over a weighted-average period of approximately 1.7 years. The following table summarizes compensation expense related to non-vested stock, which is included in selling, general and administrative expenses in the accompanying condensed consolidated statements of income for the three months ended March 31, 2019 and 2018 (amounts in thousands): For the Three Months Ended March 31, 2019 2018 Compensation expense $ 1,188 $ 1,319 |
Income per Share
Income per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Income per Share | (7) Income per Share Income per common share for the three months ended March 31, 2019 and 2018 are based on the weighted average number of common shares outstanding during the period. The effects of potentially dilutive securities that are anti-dilutive are not included in the computation of dilutive income per share. We include all common shares granted under our incentive compensation plan which remain unvested (“restricted common shares”) and contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid (“participating securities”), in the number of shares outstanding in our basic and diluted EPS calculations using the two-class method. All of our restricted common shares are currently participating securities. Under the two-class method, earnings per common share are computed by dividing the sum of distributed earnings allocated to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, distributed and undistributed earnings are allocated to both common shares and restricted common shares based on the total weighted average shares outstanding during the period. The number of restricted common shares outstanding was approximately 0.7% of total outstanding shares for each of the three months ended March 31, 2019 and 2018, and, consequently, was immaterial to the basic and diluted EPS calculations. Therefore, use of the two-class method had no impact on our basic and diluted EPS calculations for the periods presented. The following table sets forth the computation of basic and diluted net income per common share for the three months ended March 31, 2019 and 2018 (amounts in thousands, except per share amounts): Three Months Ended March 31, 2019 2018 Basic net income per share: Net income $ 14,243 $ 9,478 Weighted average number of common shares outstanding 35,787 35,592 Net income per share of common stock – basic $ 0.40 $ 0.27 Diluted net income per share: Net income $ 14,243 $ 9,478 Weighted average number of common shares outstanding 35,787 35,592 Effect of dilutive securities: Effect of dilutive non-vested restricted stock 186 287 Weighted average number of common shares outstanding – diluted 35,973 35,879 Net income per share of common stock – diluted $ 0.40 $ 0.26 Common shares excluded from the denominator as anti-dilutive: Non-vested restricted stock 37 — |
Senior Secured Credit Facility
Senior Secured Credit Facility | 3 Months Ended |
Mar. 31, 2019 | |
Secured Debt [Member] | |
Senior Secured Credit Facility | (8) Senior Secured Credit Facility We and our subsidiaries are parties to a $750.0 million Credit Facility with Wells Fargo Capital Finance, LLC as administrative agent, and the lenders named therein (the “Credit Facility”). On December 22, 2017, we amended, extended and restated the Credit Facility by entering into the Fifth Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”) by and among the Company, Great Northern Equipment, Inc., H&E Equipment Services (California), LLC, the other credit parties named therein, the lenders named therein, Wells Fargo Capital Finance, LLC, as administrative agent, the other credit parties named therein, the lenders named therein, and the joint lead arrangers, joint book runners, co-syndication agents and documentation agent named therein. The Amended and Restated Credit Agreement, among other things, (i) extended the maturity date of the Credit Facility from May 21, 2019 to December 22, 2022, (ii) increased the commitments under the senior secured asset based revolver provided for therein from $602.5 million to $750 million, (iii) increased the uncommitted incremental revolving capacity from $150 million to $250 million, (iv) provided that the unused line fee margin will be either 0.375% or 0.25%, depending on the Average Revolver Usage (as defined in the Amended and Restated Credit Agreement) of the borrowers, (v) lowered the interest rate (a) in the case of base rate revolving loans, to the base rate plus an applicable margin of 0.50% to 1.00% depending on the Average Availability (as defined in the Amended and Restated Credit Agreement) and (b) in the case of LIBOR revolving loans, to LIBOR (as defined in the Amended and Restated Credit Agreement) plus an applicable margin of 1.50% to 2.00%, depending on the Average Availability, (vi) lowered the margin applicable to the letter of credit fee to between 1.50% and 2.00%, depending on the Average Availability, and (vii) permitted, subject to certain conditions, an unlimited amount of Permitted Acquisitions, Restricted Payments and prepayments of Indebtedness (in each case, as defined in the Amended and Restated Credit Agreement). On February 1, 2019, we further amended and extended the Amended and Restated Credit Agreement with the First Amendment to the Fifth Amended and Restated Credit Agreement (the “First Amendment”) by and among the Company, Great Northern Equipment, Inc., H&E Equipment Services (California), LLC, H&E Equipment Services (Mid-Atlantic), LLC, the other credit parties named therein, the lenders named therein, Wells Fargo Capital Finance, LLC, as administrative agent, the other credit parties named therein, the lenders named therein, and the joint lead arrangers, joint book runners, co-syndication agents and documentation agent named therein. The First Amendment, among other things, (i) extended the maturity date of the credit facility from December 22, 2022 to January 31, 2024, and (ii) lowered the interest rate in the case of LIBOR revolving loans, to LIBOR plus an applicable margin of 1.25% to 1.75%, depending on the Average Availability and (iii) lowered the interest rate in the case of Base Rate loans, to the Base Rate (as defined in the Amended and Restated Credit Agreement) plus an applicable margin of 0.25% to 0.75%, depending on the Average Availability . The Amended and Restated Credit Agreement continues to provide for, among other things, a $30 million letter of credit sub-facility, and a guaranty by certain of the Company’s subsidiaries of the obligations under the Credit Facility. In addition, the Credit Facility remains secured by substantially all of the assets of the Company and certain of its subsidiaries. As of March 31, 2019, we were in compliance with our financial covenants under the Amended and Restated Credit Agreement. At March 31, 2019, we had $265.6 million of borrowings outstanding under the Credit Facility and could borrow up to approximately $476.7 million and remain in compliance with the debt covenants under the Credit Facility. At April 22, 2019, we had $462.1 million of available borrowings under our Credit Facility, net of a $7.7 million outstanding letter of credit. |
Senior Unsecured Notes
Senior Unsecured Notes | 3 Months Ended |
Mar. 31, 2019 | |
Senior Unsecured Notes [Member] | |
Debt Instrument [Line Items] | |
Senior Secured Credit Facility | (9) Senior Unsecured Notes On August 24, 2017, we completed an offering of $750 million aggregate principal amount of 5.6250% senior notes due 2025 (the “New Notes”) and the settlement of a cash tender offer (the “Tender Offer”) with respect to our 7% senior notes due 2022 (the “Old Notes”). Net proceeds, after deducting $10.3 million of estimated offering expenses, from the sale of the New Notes totaled approximately $739.7 million. We used a portion of the net proceeds from the sale of the New Notes to repurchase $329.7 million of aggregate principal amount of the Old Notes in early settlement of the Tender Offer, which the Company launched on August 17, 2017. Holders who tendered their Old Notes prior to the early tender deadline received $1,038.90 per $1,000 principal amount of Old Notes tendered, plus accrued and unpaid interest up to, but not including, the payment date of August 24, 2017. Effective as of August 24, 2017, we (i) provided notice of the redemption of all remaining Old Notes that were not validly tendered in the Tender Offer at the expiration time and (ii) satisfied and discharged the indenture governing the Old Notes in accordance with its terms. On September 25, 2017, we redeemed the remaining $300.3 million principal amount outstanding of the Old Notes at a redemption price equal to 103.50% of the principal amount thereof, plus accrued and unpaid interest up to, but not including, the date of redemption. The New Notes were issued at par and require semiannual interest payments on March 1st and September 1st of each year, commencing on March 1, 2018. No principal payments are due until maturity (September 1, 2025). The New Notes are redeemable, in whole or in part, at any time on or after September 1, 2020 at specified redemption prices plus accrued and unpaid interest to the date of redemption. We may redeem up to 40% of the aggregate principal amount of the New Notes before September 1, 2020 with the net cash proceeds from certain equity offerings. We may also redeem the New Notes prior to September 1, 2020 at a specified “make-whole” redemption price plus accrued and unpaid interest to the date of redemption. The New Notes rank equally in right of payment to all of our existing and future senior indebtedness and rank senior to any of our subordinated indebtedness. The New Notes are unconditionally guaranteed on a senior unsecured basis by all of our current and future significant domestic restricted subsidiaries. In addition, the New Notes are effectively subordinated to all of our and the guarantors’ existing and future secured indebtedness, including the Credit Facility, to the extent of the assets securing such indebtedness, and are structurally subordinated to all of the liabilities and preferred stock of any of our subsidiaries that do not guarantee the New Notes. If we experience a change of control, we will be required to offer to purchase the New Notes at a repurchase price equal to 101% of the principal amount, plus accrued and unpaid interest to the date of repurchase. The indenture governing the New Notes contains certain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: (i) incur additional indebtedness, assume a guarantee or issue preferred stock; (ii) pay dividends or make other equity distributions or payments to or affecting our subsidiaries; (iii) purchase or redeem our capital stock; (iv) make certain investments; (v) create liens; (vi) sell or dispose of assets or engage in mergers or consolidations; (vii) engage in certain transactions with subsidiaries or affiliates; (viii) enter into sale-leaseback transactions; and (ix) engage in certain business activities. Each of the covenants is subject to exceptions and qualifications. As of March 31, 2019, we were in compliance with these covenants. On November 22, 2017, we closed on an offering of $200 million aggregate principal amount of 5.625% senior notes due 2025 (the “Add-on Notes”) in an unregistered offering through a private placement. The Add-on Notes were priced at 104.25% of the principal amount. Net proceeds from the offering of the Add-on Notes, including accrued interest from August 24, 2017 totaled approximately $209.2 million. The net proceeds of the offering, was used to repay indebtedness outstanding under the Credit Facility and for the payment of fees and expenses related to the offering. The remainder of the net proceeds will be used for general corporate purposes and to fund potential acquisitions in connection with our ongoing strategy of acquiring rental companies to complement our existing business and footprint. The Add-on Notes were issued as additional notes under an indenture dated as of August 24, 2017, pursuant to which we previously issued the New Notes as described above. The Add-on Notes have identical terms to, rank equally with and form a part of a single class of securities with the New Notes. Pursuant to a registration rights agreement entered into between us, the guarantors of the New Notes and the initial purchasers of the New Notes, we agreed to make an offer to exchange (the “Exchange Offer”) the New Notes and guarantees for registered, publicly tradable notes and guarantees that have terms identical in all material respects to the New Notes (except that the exchange notes will not contain any transfer restrictions) within a certain period of time following the completion of the offering. On January 17, 2018, the Company filed a registration statement on Form S-4 with respect to an offer to exchange the New and Add-on Notes and guarantees for registered, publicly tradable notes and guarantees that have terms identical in all material respects to the New and Add-on Notes (except that the exchange notes do not contain any transfer restrictions). This exchange offer closed on March 27, 2018. The following table reconciles our Senior Unsecured Notes to our Condensed Consolidated Balance Sheets (amounts in thousands): Balance at December 31, 2017 $ 944,088 Accretion of discount through December 31, 2018 1,539 Amortization of note premium through December 31, 2018 (1,062 ) Additional deferred financing costs on New Notes (97 ) Amortization of deferred financing costs through December 31, 2018 312 Balance at December 31, 2018 $ 944,780 Accretion of discount through March 31, 2019 385 Amortization of note premium through March 31, 2019 (265 ) Amortization of deferred financing costs through March 31, 2019 77 Balance at March 31, 2019 $ 944,977 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | (10) Leases We adopted Topic 842 on January 1, 2019. Because we adopted Topic 842 using the transition method that allowed us to initially apply Topic 842 as of January 1, 2019 and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption, prior year financial statements were not recast under the new standard and, therefore, those prior year amounts are not presented below. Our lease portfolio is substantially comprised of operating leases related to leases of real estate and improvements at 84 of our 96 branch locations as of March 31, 2019. From time to time, we may also lease various types of small equipment and vehicles. Such leases are typically immaterial to our consolidated financial statements. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of lease payments over the term. Many of our leases include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when such renewal options and/or termination options are reasonably certain of exercise. We do not separate lease and nonlease components of contracts. When available, we use the rate implicit in the lease to discount lease payments to present value; however, most of our leases do not provide a readily determinable implicit rate. Therefore, we must estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement. At March 31, 2019, as disclosed in our condensed consolidated balance sheet, we had net operating lease right-of-use assets of $166.3 million and net finance lease right-of-use assets of $0.5 million. Our operating lease liabilities at March 31, 2019 were $168.6 million and finance lease liabilities were $0.7 million. The weighted average remaining lease term for operating leases was approximately 11.2 years and the weighted average remaining lease term for finance leases was approximately 3.0 years. The weighted average discount rate for operating and finance leases was approximately 6.9% and 5.9%, respectively. The table below presents certain information related to lease costs for our operating and finance leases for the three month period ended March 31, 2019 (in thousands). Classification Operating lease cost SG&A expenses $ 5,575 Finance lease cost Amortization of leased assets SG&A expenses 41 Interest of lease liabilities Interest expense 11 Variable lease cost SG&A expenses 124 Sublease income Other income (120) Total lease cost $ 5,631 The table below presents supplemental cash flow information related to leases for the three month period ended March 31, 2019 (in thousands). Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 5,429 Operating cash flows for finance leases 11 Finance cash flows for finance leases 57 The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the operating lease liabilities recorded on our condensed consolidated balance sheet as of March 31, 2019 (in thousands). Operating Leases Finance Leases 2019 $ 16,533 $ 203 2020 21,976 270 2021 21,921 270 2022 21,867 45 2023 21,823 ̶ Thereafter 138,106 ̶ Total minimum lease payments 242,226 788 Less: amount of lease payments representing interest (73,647) (63) Present value of future minimum lease payments $ 168,579 $ 725 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | (11) Segment Information We have identified five reportable segments: equipment rentals, new equipment sales, used equipment sales, parts sales and services revenues. These segments are based upon how management of the Company allocates resources and assesses performance. Non-segmented revenues and non-segmented costs relate to equipment support activities including transportation, hauling, parts freight and damage-waiver charges and are not allocated to the other reportable segments. There were no sales between segments for any of the periods presented. Selling, general and administrative expenses as well as all other income and expense items below gross profit are not generally allocated to reportable segments. We do not compile discrete financial information by segments other than the information presented below. The following table presents information about our reportable segments (amounts in thousands): Three Months Ended March 31, 2019 2018 Segment Revenues: Equipment rentals $ 176,129 $ 143,305 New equipment sales 59,103 46,493 Used equipment sales 29,634 24,853 Parts sales 30,428 28,151 Services revenues 15,568 15,036 Total segmented revenues 310,862 257,838 Non-segmented revenues 2,776 2,644 Total revenues $ 313,638 $ 260,482 Segment Gross Profit: Equipment rentals $ 77,938 $ 61,899 New equipment sales 7,004 5,648 Used equipment sales 10,622 7,916 Parts sales 8,139 7,534 Services revenues 10,564 9,986 Total segmented gross profit 114,267 92,983 Non-segmented gross loss (567 ) (398 ) Total gross profit $ 113,700 $ 92,585 Balances at March 31, December 31, 2019 2018 Segment identified assets: Equipment sales $ 122,833 $ 86,583 Equipment rentals 1,189,677 1,141,498 Parts and services 19,545 18,015 Total segment identified assets 1,332,055 1,246,096 Non-segment identified assets 673,537 481,085 Total assets $ 2,005,592 $ 1,727,181 The Company operates primarily in the United States and our sales to international customers for the three month periods ended March 31, 2019 and 2018 were 0.3% and 0.4%, respectively, of total revenues. No one customer accounted for more than 10% of our revenues on an overall or segment basis for any of the periods presented. |
Condensed Consolidating Financi
Condensed Consolidating Financial Information of Guarantor Subsidiaries | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Condensed Consolidating Financial Information of Guarantor Subsidiaries | (12) Condensed Consolidating Financial Information of Guarantor Subsidiaries All of the indebtedness of H&E Equipment Services, Inc. is guaranteed by GNE Investments, Inc. and its wholly‑owned subsidiary Great Northern Equipment, Inc., H&E Equipment Services (California), LLC, H&E California Holding, Inc., H&E Equipment Services (Mid-Atlantic), Inc. and H&E Finance Corp. The guarantor subsidiaries are all wholly‑owned and the guarantees, made on a joint and several basis, are full and unconditional (subject to subordination provisions and subject to a standard limitation which provides that the maximum amount guaranteed by each guarantor will not exceed the maximum amount that can be guaranteed without making the guarantee void under fraudulent conveyance laws). There are no restrictions on H&E Equipment Services, Inc.’s ability to obtain funds from the guarantor subsidiaries by dividend or loan. The consolidating financial statements of H&E Equipment Services, Inc. and its subsidiaries are included below. The financial statements for H&E Finance Corp. are not included within the consolidating financial statements because H&E Finance Corp. has no assets or operations. CONDENSED CONSOLIDATING BALANCE SHEET As of March 31, 2019 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 6,442 $ — $ — $ 6,442 Receivables, net 162,111 26,232 — 188,343 Inventories, net 128,334 14,045 — 142,379 Prepaid expenses and other assets 12,512 134 — 12,646 Rental equipment, net 1,034,246 155,431 — 1,189,677 Property and equipment, net 101,467 17,292 — 118,759 Operating lease right-of-use assets, net 144,630 21,663 — 166,293 Finance lease right-of-use assets, net — 487 — 487 Deferred financing costs, net 3,347 — — 3,347 Investment in guarantor subsidiaries 235,830 — (235,830 ) — Intangible assets, net 34,729 — — 34,729 Goodwill 112,964 29,526 — 142,490 Total assets $ 1,976,612 $ 264,810 $ (235,830 ) $ 2,005,592 Liabilities and Stockholders’ Equity: Amounts due on senior secured credit facility $ 265,647 $ — $ — $ 265,647 Accounts payable 105,984 9,510 — 115,494 Manufacturer flooring plans payable 26,350 — — 26,350 Accrued expenses payable and other liabilities 64,947 (3,325 ) — 61,622 Dividends payable 147 (54 ) — 93 Senior unsecured notes, net 944,977 — — 944,977 Operating lease right-of-use liabilities 146,455 22,124 — 168,579 Finance lease right-of-use liabilities — 725 — 725 Deferred income taxes 158,090 — — 158,090 Deferred compensation payable 2,016 — — 2,016 Total liabilities 1,714,613 28,980 — 1,743,593 Stockholders’ equity 261,999 235,830 (235,830 ) 261,999 Total liabilities and stockholders’ equity $ 1,976,612 $ 264,810 $ (235,830 ) $ 2,005,592 CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2018 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 16,677 $ — $ — $ 16,677 Receivables, net 166,393 35,163 — 201,556 Inventories, net 94,483 10,115 — 104,598 Prepaid expenses and other assets 10,382 126 — 10,508 Rental equipment, net 983,281 158,217 — 1,141,498 Property and equipment, net 98,251 16,870 — 115,121 Deferred financing costs, net 3,000 — — 3,000 Investment in guarantor subsidiaries 246,309 — (246,309 ) — Intangible assets, net 28,380 — 28,380 Goodwill 76,317 29,526 — 105,843 Total assets $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 Liabilities and Stockholders’ Equity: Amounts due under senior secured credit facility $ 170,761 $ — $ — $ 170,761 Accounts payable 95,866 5,974 — 101,840 Manufacturer flooring plans payable 23,178 488 — 23,666 Accrued expenses payable and other liabilities 76,798 (3,427 ) — 73,371 Dividends payable 185 (53 ) — 132 Senior unsecured notes, net 944,780 — — 944,780 Capital leases payable — 726 — 726 Deferred income taxes 153,113 — — 153,113 Deferred compensation payable 1,989 — — 1,989 Total liabilities 1,466,670 3,708 — 1,470,378 Stockholders’ equity 256,803 246,309 (246,309 ) 256,803 Total liabilities and stockholders’ equity $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended March 31, 2019 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 153,533 $ 22,596 $ — $ 176,129 New equipment sales 52,575 6,528 — 59,103 Used equipment sales 25,212 4,422 — 29,634 Parts sales 26,554 3,874 — 30,428 Services revenues 13,166 2,402 — 15,568 Other 1,393 1,383 — 2,776 Total revenues 272,433 41,205 — 313,638 Cost of revenues: Rental depreciation 49,263 7,885 — 57,148 Rental expense 21,152 3,616 — 24,768 Rental other 14,063 2,212 16,275 84,478 13,713 — 98,191 New equipment sales 46,460 5,639 — 52,099 Used equipment sales 16,211 2,801 — 19,012 Parts sales 19,591 2,698 — 22,289 Services revenues 4,282 722 — 5,004 Other 2,710 633 — 3,343 Total cost of revenues 173,732 26,206 — 199,938 Gross profit (loss): Equipment rentals 69,055 8,883 — 77,938 New equipment sales 6,115 889 — 7,004 Used equipment sales 9,001 1,621 — 10,622 Parts sales 6,963 1,176 — 8,139 Services revenues 8,884 1,680 — 10,564 Other (1,317 ) 750 — (567 ) Gross profit 98,701 14,999 — 113,700 Selling, general and administrative expenses 68,556 10,091 — 78,647 Merger costs 119 — — 119 Equity in earnings of guarantor subsidiaries 1,724 — (1,724 ) — Gain on sales of property and equipment, net 707 34 — 741 Income from operations 32,457 4,942 (1,724 ) 35,675 Other income (expense): Interest expense (13,562 ) (3,293 ) — (16,855 ) Other, net 457 75 — 532 Total other expense, net (13,105 ) (3,218 ) — (16,323 ) Income before income taxes 19,352 1,724 (1,724 ) 19,352 Income tax expense 5,109 — — 5,109 Net income $ 14,243 $ 1,724 $ (1,724 ) $ 14,243 CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended March 31, 2018 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 117,184 $ 19,854 $ — $ 137,038 New equipment sales 39,901 6,592 — 46,493 Used equipment sales 20,226 4,627 — 24,853 Parts sales 24,347 3,804 — 28,151 Services revenues 12,782 2,254 — 15,036 Other 7,592 1,319 — 8,911 Total revenues 222,032 38,450 — 260,482 Cost of revenues: Rental depreciation 39,559 6,910 — 46,469 Rental expense 18,261 3,011 — 21,272 Rental other 9,889 2,211 12,100 67,709 12,132 — 79,841 New equipment sales 35,083 5,762 — 40,845 Used equipment sales 13,832 3,105 — 16,937 Parts sales 17,956 2,661 — 20,617 Services revenues 4,361 689 — 5,050 Other 4,027 580 — 4,607 Total cost of revenues 142,968 24,929 — 167,897 Gross profit (loss): Equipment rentals 49,475 7,722 — 57,197 New equipment sales 4,818 830 — 5,648 Used equipment sales 6,394 1,522 — 7,916 Parts sales 6,391 1,143 — 7,534 Services revenues 8,421 1,565 — 9,986 Other 3,565 739 — 4,304 Gross profit 79,064 13,521 — 92,585 Selling, general and administrative expenses 55,009 10,871 — 65,880 Merger costs 152 — — 152 Equity in earnings of guarantor subsidiaries 458 — (458 ) — Gain on sales of property and equipment, net 714 59 — 773 Income from operations 25,075 2,709 (458 ) 27,326 Other income (expense): Interest expense (12,349 ) (2,304 ) — (14,653 ) Other, net 342 53 — 395 Total other expense, net (12,007 ) (2,251 ) — (14,258 ) Income before income taxes 13,068 458 (458 ) 13,068 Income tax benefit 3,590 — — 3,590 Net income $ 9,478 $ 458 $ (458 ) $ 9,478 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2019 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 14,243 $ 1,724 $ (1,724 ) $ 14,243 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 5,692 787 — 6,479 Depreciation of rental equipment 49,263 7,885 — 57,148 Amortization of finance lease right-of-use assets — 41 — 41 Amortization of intangible assets 952 — — 952 Amortization of deferred financing costs 254 — — 254 Accretion of note discount, net of premium amortization 120 — — 120 Operating lease right-of-use liabilities, net 113 33 146 Provision for losses on accounts receivable 1,112 189 — 1,301 Provision for inventory obsolescence 42 — — 42 Change in deferred income taxes 4,977 — — 4,977 Stock-based compensation expense 1,188 — — 1,188 Gain from sales of property and equipment, net (707 ) (34 ) — (741 ) Gain from sales of rental equipment, net (9,004 ) (1,617 ) — (10,621 ) Equity in earnings of guarantor subsidiaries (1,724 ) — 1,724 — Changes in operating assets and liabilities: Receivables 8,863 8,742 — 17,605 Inventories (51,703 ) (6,359 ) — (58,062 ) Prepaid expenses and other assets (2,109 ) (8 ) — (2,117 ) Accounts payable 10,003 3,536 — 13,539 Manufacturer flooring plans payable 3,172 (488 ) — 2,684 Accrued expenses payable and other liabilities (10,667 ) 530 — (10,137 ) Deferred compensation payable 27 — — 27 Net cash provided by operating activities 24,107 14,961 — 39,068 Cash flows from investing activities: Acquisition of business, net of cash acquired (106,746 ) — (106,746 ) Purchases of property and equipment (5,446 ) (1,775 ) — (7,221 ) Purchases of rental equipment (43,311 ) (5,333 ) — (48,644 ) Proceeds from sales of property and equipment 859 72 — 931 Proceeds from sales of rental equipment 24,012 4,280 — 28,292 Investment in subsidiaries 12,203 — (12,203 ) — Net cash used in investing activities. (118,429 ) (2,756 ) (12,203 ) (133,388 ) Cash flows from financing activities: Borrowings on senior secured credit facility 447,503 — — 447,503 Payments on senior secured credit facility (352,617 ) — — (352,617 ) Dividends paid (9,831 ) (1 ) — (9,832 ) Purchases of treasury stock (387 ) — — (387 ) Payment of deferred financing costs (525 ) — — (525 ) Payments on finance lease obligations (56 ) (1 ) — (57 ) Capital contributions — (12,203 ) 12,203 — Net cash provided by (used in) financing activities 84,087 (12,205 ) 12,203 84,085 Net decrease in cash (10,235 ) — — (10,235 ) Cash, beginning of period 16,677 — — 16,677 Cash, end of period $ 6,442 $ — $ — $ 6,442 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2018 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 9,478 $ 458 $ (458 ) $ 9,478 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 5,163 721 — 5,884 Depreciation of rental equipment 39,559 6,910 — 46,469 Amortization of intangible assets 705 705 Amortization of deferred financing costs 289 — — 289 Accretion of note discount, net of premium amortization 120 — — 120 Provision for losses on accounts receivable 593 224 — 817 Provision for inventory obsolescence 67 — — 67 Change in deferred income taxes 4,456 — — 4,456 Stock-based compensation expense 1,319 — — 1,319 Gain from sales of property and equipment, net (714 ) (59 ) — (773 ) Gain from sales of rental equipment, net (6,228 ) (1,517 ) — (7,745 ) Equity in earnings of guarantor subsidiaries (458 ) — 458 — Changes in operating assets and liabilities: Receivables 11,687 10,727 — 22,414 Inventories (78,456 ) (10,218 ) — (88,674 ) Prepaid expenses and other assets (2,175 ) (62 ) — (2,237 ) Accounts payable 45,770 (386 ) — 45,384 Manufacturer flooring plans payable 7,143 (1,033 ) — 6,110 Accrued expenses payable and other liabilities (15,286 ) (513 ) — (15,799 ) Deferred compensation payable 22 — — 22 Net cash provided by operating activities 23,054 5,252 — 28,306 Cash flows from investing activities: Acquisition of business, net of cash acquired (125,207 ) — — (125,207 ) Purchases of property and equipment (4,301 ) (204 ) — (4,505 ) Purchases of rental equipment (36,688 ) (3,966 ) — (40,654 ) Proceeds from sales of property and equipment 726 59 — 785 Proceeds from sales of rental equipment 18,901 4,529 — 23,430 Investment in subsidiaries 5,613 — (5,613 ) — Net cash provided by (used in) investing activities (140,956 ) 418 (5,613 ) (146,151 ) Cash flows from financing activities: Borrowings on senior secured credit facility 294,229 — — 294,229 Payments on senior secured credit facility (294,229 ) — — (294,229 ) Dividends paid (9,804 ) — — (9,804 ) Payments of deferred financing costs (88 ) — — (88 ) Payments on capital lease obligations — (57 ) — (57 ) Capital contributions — (5,613 ) 5,613 — Net cash used in financing activities (9,892 ) (5,670 ) 5,613 (9,949 ) Net decrease in cash (127,794 ) — — (127,794 ) Cash, beginning of period 165,878 — — 165,878 Cash, end of period $ 38,084 $ — $ — $ 38,084 |
Organization and Nature of Op_2
Organization and Nature of Operations (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Our condensed consolidated financial statements include the financial position and results of operations of H&E Equipment Services, Inc. and its wholly-owned subsidiaries H&E Finance Corp., GNE Investments, Inc., Great Northern Equipment, Inc., H&E California Holding, Inc., H&E Equipment Services (California), LLC and H&E Equipment Services (Mid-Atlantic), Inc., collectively referred to herein as “we” or “us” or “our” or the “Company.” The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such regulations. In the opinion of management, all adjustments (consisting of all normal and recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019, and therefore, the results and trends in these interim condensed consolidated financial statements may not be the same for the entire year. These interim condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 31, 2018, from which the consolidated balance sheet amounts as of December 31, 2018 were derived. All significant intercompany accounts and transactions have been eliminated in these condensed consolidated financial statements. Business combinations accounted for as purchases are included in the condensed consolidated financial statements from their respective dates of acquisition. The nature of our business is such that short-term obligations are typically met by cash flows generated from long-term assets. Consequently, and consistent with industry practice, the accompanying condensed consolidated balance sheets are presented on an unclassified basis. Historically, we have presented hauling revenues and related cost of sales associated with our equipment rental activities within Other Revenues and Other Cost of Sales. This presentation did not change upon our adoption of Topic 606 on January 1, 2018 as hauling activities are deemed a separate performance obligation under Topic 606 and SEC Regulation S-X permitted flexibility in the presentation of such revenues . However, given the presentation changes of certain ancillary fees required by Topic 842 as described in note 2 to these condensed consolidated financial statements, we believe that including equipment rental hauling revenues and related costs of sales within our Rental Revenues segment results in a more meaningful presentation and analysis of our equipment rental activities. In accordance with SEC Regulation S-X , the reclassification of equipment rental hauling revenues and related cost of sales from Other Revenues and Other Cost of Sales to Rental Revenues and Rental Other Cost of Sales is presented on a retrospective basis, meaning our condensed consolidated statements of income for the three month periods ended March 31, 2019 and 2018 include hauling revenues and related costs of sales presented within Equipment Rental Revenues and Rental Other Cost of Sales. The table below reconciles for the three month period ended March 31, 2018, our Revenues, Cost of Revenues and Gross Profit as previously reported to the current period presentation in this Quarterly Report on Form 10-Q. $'s in thousands Three Month Period Ended March 31, 2018 As Previously Reported Hauling Fees As Currently Reported REVENUES Equipment rentals $ 129,361 $ 7,677 $ 137,038 New equipment sales 46,493 - 46,493 Used equipment sales 24,853 - 24,853 Parts sales 28,151 - 28,151 Services revenues 15,036 - 15,036 Other 16,588 (7,677) 8,911 Total revenues 260,482 - 260,482 COST OF REVENUES Rental depreciation 46,469 - 46,469 Rental expense 21,272 - 21,272 Rental other - 12,100 12,100 67,741 12,100 79,841 New equipment sales 40,845 - 40,845 Used equipment sales 16,937 - 16,937 Parts sales 20,617 - 20,617 Services revenues 5,050 - 5,050 Other 16,707 (12,100) 4,607 Total cost of revenues 167,897 - 167,897 Gross Profit $ 92,585 $ - $ 92,585 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, which requires management to use its judgment to make estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. These assumptions and estimates could have a material effect on our condensed consolidated financial statements. Actual results may differ materially from those estimates. We review our estimates on an ongoing basis based on information currently available, and changes in facts and circumstances may cause us to revise these estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Pronouncements Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, “ Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other – Internal-Use Software In August 2018, the FASB issued ASU No. 2018-13, " Fair Value Measurement - Disclosure Framework, Recently Adopted Accounting Pronouncements Leases We adopted ASU No. 2016-02, Leases Lessor Accounting Our equipment rental business involves rental contracts with customers whereby we are the lessor in the transaction and therefore, we believe that such transactions are subject to Topic 842. We account for such rental contracts as operating leases pursuant to Topic 842, as well as pursuant to previous lease accounting guidance (Topic 840) in effect for periods prior to the effective date of Topic 842. In accordance with Topic 842, certain ancillary fees that we charge our equipment rental customers result in a different presentation within our consolidated statements of income compared to our historical presentation of those items under previous lease accounting guidance. Specifically, amounts we charge our customers for loss damage waiver fees, environmental fees, and fuel and other recovery fees, upon adoption of Topic 842, are to be included within our Equipment Rentals segment rather than included within non-segmented Other Revenues as we have historically presented those items under previous lease accounting guidance. Likewise, the related cost of goods sold for these ancillary items under Topic 842 are to be presented within our Equipment Rentals segment rather than included in non-segmented Other Cost of Goods Sold as we have historically presented under previous lease accounting guidance. We adopted Topic 842 on January 1, 2019 using the transition method that allowed us to initially apply Topic 842 as of January 1, 2019 and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. As such, Topic 842 will not be applied to periods prior to January 1, 2019. Therefore, the above changes as described are not reflected in our condensed consolidated statements of income for the three month period ended March 31, 2018. While the above changes resulting from our adoption of Topic 842 do not impact total consolidated revenues or total consolidated gross profit, the change does impact the comparability of our total Rental Revenues and total Other Revenues gross profit and resulting gross margins for 2019 compared to our previously reported gross profit and resulting gross margins for periods prior to January 1, 2019. Lessee Accounting Topic 842 requires leases with durations greater than twelve months to be recognized on the balance sheet. We adopted Topic 842 using the modified retrospective approach with an effective date as of the beginning of our fiscal year, January 1, 2019. Therefore, prior year financial statements were not recast under the new standard. We recognized an adjustment of less than $0.1 million to retained earnings upon adoption of Topic 842. We elected the package of transition provisions available for expired or existing leases, which allowed us to carryforward our historical assessments of (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. We did not elect the use-of-hindsight practical expedient or the practical expedient pertaining to land easements. We elected not to apply Topic 842 to arrangements with lease terms of 12 months or less. The adoption of Topic 842 had a material impact on our consolidated balance sheet related to operating leases. Upon adoption of Topic 842, we recognized additional operating lease liabilities, net of deferred rent, of $162.8 million. We also recognized corresponding right-of-use operating lease assets of $162.8 million. Finance lease liabilities recognized upon adoption of Topic 842 were $0.8 million and finance right-of-use lease assets were $0.5 million. Topic 842 significantly expanded the disclosure requirements related to our leasing activities. Additional information and disclosures required by Topic 842 are presented in note 10 to these condensed consolidated financial statements. |
Revenue Recognition | Revenue Recognition In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Entities may use a full retrospective approach or report on the cumulative effect as of the date of adoption. We adopted this standard effective January 1, 2018 using the full retrospective transition method. As described above and in note 10 to these condensed consolidated financial statements, we adopted Topic 842 on January 1, 2019. We recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 842. Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. Our contracts with customers generally do not include multiple performance obligations. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services. In the table below, revenue as presented in our condensed consolidated statement of income for the three month period ended March 31, 2019 and 2018 is summarized by type and by the applicable accounting standard. Three Month Period Ended March 31, 2019 2018 Topic 842 Topic 606 Total Topic 840 Topic 606 Total Revenues: Rental revenues Owned equipment rentals $ 153,350 $ 274 $ 153,624 $ 123,734 $ 522 $ 124,256 Re-rent revenue 6,036 ─ 6,036 5,105 ─ 5,105 Ancillary and other rental revenues: Delivery and pick-up ─ 8,982 8,982 ─ 7,677 7,677 Other 7,487 ─ 7,487 ─ ─ ─ Total ancillary rental revenues 7,487 8,982 16,469 ─ 7,677 7,677 Total equipment rental revenues 166,873 9,256 176,129 128,839 8,199 137,038 New equipment sales ─ 59,103 59,103 ─ 46,493 46,493 Used equipment sales ─ 29,634 29,634 ─ 24,853 24,853 Parts sales ─ 30,428 30,428 ─ 28,151 28,151 Service revenues ─ 15,568 15,568 ─ 15,036 15,036 Other ─ 2,776 2,776 6,267 2,644 8,911 Total revenues $ 166,873 $146,765 $ 313,638 $ 135,106 $ 125,376 $ 260,482 Revenues by reporting segment are presented in note 11 of our condensed consolidated financial statements, using the revenue captions reflected in our consolidated statements of income. We believe that the disaggregation of our revenues from contracts to customers as reflected above, coupled with further discussion below and the reporting segments in note 11, depict how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by economic factors. Lease revenues (Topic 842) Owned Equipment Rentals: Owned equipment rentals represent revenues from renting equipment. We account for these rental contracts as operating leases. We recognize revenue from equipment rentals in the period earned, regardless of the timing of billing to customers. A rental contract includes rates for daily, weekly or monthly use, and rental revenues are earned on a daily basis as rental contracts remain outstanding. Because the rental contracts can extend across multiple reporting periods, we record unbilled rental revenues and deferred rental revenues at the end of reporting periods so rental revenues earned is appropriately stated for the periods presented. Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above. “Other” equipment rental revenue is primarily comprised of (i) revenue from customers who purchase insurance to protect against potential damages or loss the equipment they rent, (ii) environmental charges associated with the rental of equipment, and (iii) fuel recovery fees charged to customers. Fuel consumption charges are recognized upon return of the rental equipment when fuel consumption by the customer, if any, can be measured. Income from environmental fees and damage waiver insurance policies are recognized when earned over the period the equipment is rented. Prior to our adoption of Topic 842 on January 1, 2019, these revenue items were included in other revenues as shown in the table above for the three month period ended March 31, 2018. Revenues from contracts with customers (Topic 606) The accounting for the types of revenues accounted for pursuant to Topic 606 are discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time. Rental revenues: An insignificant portion of our total equipment rental revenues are recognized pursuant to Topic 606 rather than pursuant to Topic 842. These revenues represent services performed by us in connection with the rental of equipment and are comprised of customer training fees on rented equipment and erection and dismantling services on rental equipment. Revenues for these services are recognized upon completion of such services. See discussion above regarding rental revenues recognized pursuant to Topic 842. Delivery and pick-up : Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed. New equipment sales: Revenues from the sales of new equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Used equipment sales: Revenues from the sales of used equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Parts sales: Revenues from the sales of equipment parts are recognized at the time of pick-up by the customer for parts counter sales transactions. For parts that are shipped to a customer, we elected to use a practical expedient of Topic 606 and treat such shipping activities as fulfillment costs, thereby recognizing revenues at the time of shipment. Services revenues: We derive our services primarily from maintenance and repair services to customers for their owned equipment. We recognize services revenues at the time such services are completed, which is when the customer obtains control of the promised service. Other revenues : Other revenues relate primarily to hauling fees for transporting equipment sold to and from the customer and ancillary charges associated with equipment maintenance and repair services. Such revenues are recognized at the time the services are performed. Receivables and contract assets and liabilities We manage credit risk associated with our accounts receivables at the customer level. Because the same customers typically generate the revenues that are accounted for under both Topic 606 and Topic 842, the discussions below on credit risk and our allowance for doubtful accounts address our total revenues from Topic 606 and Topic 842. We believe concentration of credit risk with respect to our receivables is limited because our customer base is comprised of a large number of geographically diverse customers. No single customer accounted for more than 10% of our revenues on an overall or segment basis for any of the periods presented in this Quarterly Report on Form 10-Q. We manage credit risk through credit approvals, credit limits and other monitoring procedures. We maintain an allowance for doubtful accounts that reflects our estimate of the amount of our receivables that we will be unable to collect. We develop our estimate of this allowance based on our historical experience with specific customers, our understanding of our current economic circumstances and our own judgment as to the likelihood of ultimate payment. Our largest exposure to doubtful accounts is in our rental operations. We perform credit evaluations of customers and establish credit limits based on reviews of our customers’ current credit information and payment histories. We believe our credit risk is somewhat mitigated by our geographically diverse customer base and our credit evaluation procedures. During the year, we write-off customer account balances when we have exhausted reasonable collection efforts and determined that the likelihood of collection is remote. Such write-offs are charged against our allowance for doubtful accounts. Bad debt expense as a percentage of total revenues for the three month periods ended March 31, 2019 and 2018 were approximately 0.4% and 0.3%, respectively. The actual rate of future credit losses, however, may not be similar to past experience. Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance for doubtful accounts. We do not have material contract assets, impairment losses associated therewith, or material contract liabilities associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenues during the three month periods ended March 31, 2019 or 2018 that was included in the contract liability balance as of the beginning of such periods. Performance obligations Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amount of such revenue recognized during the three month periods ended March 31, 2019 and 2018 was not material. We also do not expect to recognize material revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2019. Payment terms Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk. Sales tax amounts collected from customers are recorded on a net basis. Contract costs We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. Contract estimates and judgments Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments as the transaction price is generally fixed and stated on our contracts. Our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation. Also, our revenues do not include material amounts of variable consideration. Substantially all of our revenues are recognized at a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenues are generally recognized at the time of delivery to, or pick-up by, the customer. |
Organization and Nature of Op_3
Organization and Nature of Operations (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Summary of Revenues, Cost of Revenues and Gross Profit as Previously Reported | $'s in thousands Three Month Period Ended March 31, 2018 As Previously Reported Hauling Fees As Currently Reported REVENUES Equipment rentals $ 129,361 $ 7,677 $ 137,038 New equipment sales 46,493 - 46,493 Used equipment sales 24,853 - 24,853 Parts sales 28,151 - 28,151 Services revenues 15,036 - 15,036 Other 16,588 (7,677) 8,911 Total revenues 260,482 - 260,482 COST OF REVENUES Rental depreciation 46,469 - 46,469 Rental expense 21,272 - 21,272 Rental other - 12,100 12,100 67,741 12,100 79,841 New equipment sales 40,845 - 40,845 Used equipment sales 16,937 - 16,937 Parts sales 20,617 - 20,617 Services revenues 5,050 - 5,050 Other 16,707 (12,100) 4,607 Total cost of revenues 167,897 - 167,897 Gross Profit $ 92,585 $ - $ 92,585 |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Revenue by Type and by Applicable Accounting Standard | In the table below, revenue as presented in our condensed consolidated statement of income for the three month period ended March 31, 2019 and 2018 is summarized by type and by the applicable accounting standard. Three Month Period Ended March 31, 2019 2018 Topic 842 Topic 606 Total Topic 840 Topic 606 Total Revenues: Rental revenues Owned equipment rentals $ 153,350 $ 274 $ 153,624 $ 123,734 $ 522 $ 124,256 Re-rent revenue 6,036 ─ 6,036 5,105 ─ 5,105 Ancillary and other rental revenues: Delivery and pick-up ─ 8,982 8,982 ─ 7,677 7,677 Other 7,487 ─ 7,487 ─ ─ ─ Total ancillary rental revenues 7,487 8,982 16,469 ─ 7,677 7,677 Total equipment rental revenues 166,873 9,256 176,129 128,839 8,199 137,038 New equipment sales ─ 59,103 59,103 ─ 46,493 46,493 Used equipment sales ─ 29,634 29,634 ─ 24,853 24,853 Parts sales ─ 30,428 30,428 ─ 28,151 28,151 Service revenues ─ 15,568 15,568 ─ 15,036 15,036 Other ─ 2,776 2,776 6,267 2,644 8,911 Total revenues $ 166,873 $146,765 $ 313,638 $ 135,106 $ 125,376 $ 260,482 |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
CEC [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed as of the acquisition date. $’s in thousands Cash $ 1,244 Accounts receivable 7,583 Inventory 504 Prepaid expenses and other assets 324 Rental equipment 55,342 Property and equipment 2,700 Intangible assets (1) 21,500 Total identifiable assets acquired 89,197 Accounts payable (1,023) Accrued expenses payable and other liabilities (876) Total liabilities assumed (1,899) Net identifiable assets acquired 87,298 Goodwill (2) 45,092 Net assets acquired $ 132,390 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 21,000 10 Tradenames 300 1 Leasehold interests 200 10 $ 21,500 (2) We have allocated the $45.1 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $25,233 Rental Component 2 18,391 New Equipment 217 Used Equipment 632 Parts 379 Service 240 |
Unaudited Pro Forma Consolidated Statements of Income Information | Pursuant to ASC 805, pro forma disclosures should be repeated whenever the year or interim period of the acquisition is presented. Since the CEC acquisition was completed in the first quarter of 2018, the pro forma information below gives effect to the CEC acquisition as if the acquisition occurred on January 1, 2017 (the CEC pro forma acquisition date) for the three month period ended March 31, 2017. (amounts in thousands) Three Month Period Ended March 31, 2017 H&E CEC Total Total revenues (1) $ 226,828 $ 8,389 $ 235,217 Pretax income 8,530 1,441 9,971 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (2) (903) (903) Intangible asset amortization (3) (705) (705) Pro forma pretax income (loss) 8,530 (167) 8,363 Income tax expense (benefit) 3,140 (63) 3,077 Net income (loss) $ 5,390 $ (104) $ 5,286 Net income per share - basic $ 0.15 $ ─ $ 0.15 Net income per share – diluted $ 0.15 $ ─ $ 0.15 (1) There were no nonrecurring pro forma adjustments directly attributable to the CEC acquisition included in the reported pro forma total revenues. (2) Depreciation of rental equipment and non-rental equipment were adjusted for the fair value markups, and the changes in useful lives and salvage values of the equipment acquired in the CEC acquisition. (3) Represents the amortization of the intangible assets acquired in the CEC acquisition. |
Rental Inc [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the fair value of the assets acquired and liabilities assumed as of the acquisition date. $’s in thousands Cash $ 260 Accounts receivable 2,873 Inventory 5,324 Prepaid expenses and other assets 47 Rental equipment 22,578 Property and equipment 1,935 Intangible assets (1) 10,200 Total identifiable assets acquired 43,217 Accounts payable (439) Manufacturer flooring plans payable (3,293) Accrued expenses payable and other liabilities (469) Total liabilities assumed (4,201) Net identifiable assets acquired 39,016 Goodwill (2) 29,554 Net assets acquired $ 68,570 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 10,000 10 Tradenames 200 1 $ 10,200 (2) We have allocated the $29.6 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $9,064 Rental Component 2 5,445 New Equipment 10,217 Used Equipment 1,692 Parts 2,171 Service 964 |
We-Rent-It [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date. The amounts presented below are preliminary and are subject to change. $’s in thousands Cash $ 1,745 Accounts receivable 5,149 Inventory 873 Prepaid expenses and other assets 544 Rental equipment 53,242 Property and equipment 3,959 Other assets 21 Intangible assets (1) 7,300 Total identifiable assets acquired 72,833 Accounts payable (115) Accrued expenses payable and other liabilities (874) Total liabilities assumed (989) Net identifiable assets acquired 71,844 Goodwill 36,647 Net assets acquired $ 108,491 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 7,300 10 |
Unaudited Pro Forma Consolidated Statements of Income Information | The tables below present unaudited pro forma consolidated statements of income information for the three month period ended March 31, 2018 as if WRI w as included in our consolidated results for the entire period presented. (amounts in thousands, except per share data) Three Month Period Ended March 31, 2018 H&E(1) We-Rent-It Total Total revenues $260,482 $7,587 $268,069 Pretax income 13,068 784 13,852 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (2) — (250) (250) Intangible asset amortization (3) — (122) (122) Interest expense (4) — (1,356) (1,356) Elimination of historic interest expense (5) — 80 80 Pro forma pretax income (loss) 13,068 (864) 12,204 Income tax expense (benefit) 3,590 (235) 3,355 Net income (loss) $ 9,478 $ (629) $8,849 Net income (loss) per share – basic $ 0.27 $(0.02) $ 0.25 Net income (loss) per share - diluted $ 0.26 $(0.02) $ 0.25 (1) Amounts presented above for “H&E” are derived from the Company’s consolidated statements of income in this Quarterly Report on Form 10-Q for the three month period ended March 31, 2018. (2) Depreciation of rental equipment and non-rental equipment were adjusted for the fair value markups, and the changes in useful lives and salvage values of the equipment acquired in the acquisition. (3) Represents the amortization of the intangible asset acquired in the acquisition. (4) Interest expense was adjusted to reflect the additional debt resulting from the acquisition. (5) Represents the elimination of historic debt of WRI that is not part of the combined entity. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Estimated Incremental Borrowing Rates for Similar Types of Borrowing Arrangements | The carrying amounts and fair values of our other financial instruments subject to fair value disclosures as of March 31, 2019 and December 31, 201 8 are presented in the table below (amounts in thousands) and have been calculated based upon market quotes and present value calculations based on market rates. March 31, 2019 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) $ 26,350 $ 22,281 Senior unsecured notes with interest computed at 5.625% (Level 2) 944,977 947,625 Letter of credit (Level 3) — 97 December 31, 2018 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) $ 23,666 $ 19,870 Senior unsecured notes with interest computed at 5.625% (Level 2) 944,780 871,625 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 726 330 Letter of credit (Level 3) — 116 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Summary of Activity in Stockholders' Equity | The following table summarizes the activity in Stockholders’ Equity for the three month period ended March 31, 2019 and March 31, 2018, respectively (amounts in thousands, except share data): Common Stock Additional Total Shares Issued Amount Paid-in Capital Treasury Stock Retained Earnings Stockholders’ Equity Balances at December 31, 2018 39,748,562 $ 396 $ 231,174 $ (63,099 ) $ 88,332 $ 256,803 Stock-based compensation — — 1,188 — — 1,188 Cash dividends declared on common stock ($0.275 per share) — — — — (9,793 ) (9,793 ) Issuance of common stock, net of forfeitures 59,510 1 — — 1 Repurchase of 14,272 shares of restricted common stock — — — (387 ) — (387 ) Cumulative effect adjustment pursuant to the adoption of ASC 842 — — — — (56 ) (56 ) Net income — — — — 14,243 14,243 Balances at March 31, 2019 39,808,072 $ 397 $ 232,362 $ (63,486 ) $ 92,726 $ 261,999 Balances at December 31, 2017 39,623,773 $ 395 $ 227,070 $ (61,749 ) $ 51,077 $ 216,793 Stock-based compensation — — 1,319 — — 1,319 Cash dividends declared on common stock ($0.275 per share) — — — — (9,845 ) (9,845 ) Issuance of common stock, net of forfeitures 9,534 — — — — — Net income — — — — 9,478 9,478 Balances at March 31, 2018 39,633,307 $ 395 $ 228,389 $ (61,749 ) $ 50,710 $ 217,745 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Non-Vested Stock Activity | The following table summarizes our non-vested stock activity for the nine months ended March 31, 2019: Number of Shares Weighted Average Grant Date Fair Non-vested stock at December 31, 2018 379,559 $ 25.87 Granted 20,923 $ 26.77 Vested (57,296 ) $ 21.60 Forfeited (25,120 ) $ 19.80 Non-vested stock at March 31, 2019 318,066 $ 27.18 |
Schedule of Compensation Expense Related to Non-Vested Stock | The following table summarizes compensation expense related to non-vested stock, which is included in selling, general and administrative expenses in the accompanying condensed consolidated statements of income for the three months ended March 31, 2019 and 2018 (amounts in thousands): For the Three Months Ended March 31, 2019 2018 Compensation expense $ 1,188 $ 1,319 |
Income per Share (Tables)
Income per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Summary of Computation of Basic and Diluted Net Income Per Common Share | The following table sets forth the computation of basic and diluted net income per common share for the three months ended March 31, 2019 and 2018 (amounts in thousands, except per share amounts): Three Months Ended March 31, 2019 2018 Basic net income per share: Net income $ 14,243 $ 9,478 Weighted average number of common shares outstanding 35,787 35,592 Net income per share of common stock – basic $ 0.40 $ 0.27 Diluted net income per share: Net income $ 14,243 $ 9,478 Weighted average number of common shares outstanding 35,787 35,592 Effect of dilutive securities: Effect of dilutive non-vested restricted stock 186 287 Weighted average number of common shares outstanding – diluted 35,973 35,879 Net income per share of common stock – diluted $ 0.40 $ 0.26 Common shares excluded from the denominator as anti-dilutive: Non-vested restricted stock 37 — |
Senior Unsecured Notes (Tables)
Senior Unsecured Notes (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Senior Unsecured Notes [Member] | |
Debt Instrument [Line Items] | |
Reconciliation of Senior Unsecured Notes to Condensed Consolidated Balance Sheets | The following table reconciles our Senior Unsecured Notes to our Condensed Consolidated Balance Sheets (amounts in thousands): Balance at December 31, 2017 $ 944,088 Accretion of discount through December 31, 2018 1,539 Amortization of note premium through December 31, 2018 (1,062 ) Additional deferred financing costs on New Notes (97 ) Amortization of deferred financing costs through December 31, 2018 312 Balance at December 31, 2018 $ 944,780 Accretion of discount through March 31, 2019 385 Amortization of note premium through March 31, 2019 (265 ) Amortization of deferred financing costs through March 31, 2019 77 Balance at March 31, 2019 $ 944,977 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Summary of Lease Costs for Operating and Finance Leases | The table below presents certain information related to lease costs for our operating and finance leases for the three month period ended March 31, 2019 (in thousands). Classification Operating lease cost SG&A expenses $ 5,575 Finance lease cost Amortization of leased assets SG&A expenses 41 Interest of lease liabilities Interest expense 11 Variable lease cost SG&A expenses 124 Sublease income Other income (120) Total lease cost $ 5,631 |
Schedule of Supplemental Cash Flow Information Related to Leases | The table below presents supplemental cash flow information related to leases for the three month period ended March 31, 2019 (in thousands). Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 5,429 Operating cash flows for finance leases 11 Finance cash flows for finance leases 57 |
Summary of Undiscounted Cash Flows and Operating Lease Liabilities Recorded on Condensed Consolidated Balance Sheet | The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the operating lease liabilities recorded on our condensed consolidated balance sheet as of March 31, 2019 (in thousands). Operating Leases Finance Leases 2019 $ 16,533 $ 203 2020 21,976 270 2021 21,921 270 2022 21,867 45 2023 21,823 ̶ Thereafter 138,106 ̶ Total minimum lease payments 242,226 788 Less: amount of lease payments representing interest (73,647) (63) Present value of future minimum lease payments $ 168,579 $ 725 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Information about Reportable Segments | The following table presents information about our reportable segments (amounts in thousands): Three Months Ended March 31, 2019 2018 Segment Revenues: Equipment rentals $ 176,129 $ 143,305 New equipment sales 59,103 46,493 Used equipment sales 29,634 24,853 Parts sales 30,428 28,151 Services revenues 15,568 15,036 Total segmented revenues 310,862 257,838 Non-segmented revenues 2,776 2,644 Total revenues $ 313,638 $ 260,482 Segment Gross Profit: Equipment rentals $ 77,938 $ 61,899 New equipment sales 7,004 5,648 Used equipment sales 10,622 7,916 Parts sales 8,139 7,534 Services revenues 10,564 9,986 Total segmented gross profit 114,267 92,983 Non-segmented gross loss (567 ) (398 ) Total gross profit $ 113,700 $ 92,585 Balances at March 31, December 31, 2019 2018 Segment identified assets: Equipment sales $ 122,833 $ 86,583 Equipment rentals 1,189,677 1,141,498 Parts and services 19,545 18,015 Total segment identified assets 1,332,055 1,246,096 Non-segment identified assets 673,537 481,085 Total assets $ 2,005,592 $ 1,727,181 |
Condensed Consolidating Finan_2
Condensed Consolidating Financial Information of Guarantor Subsidiaries (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Condensed Consolidating Balance Sheet | CONDENSED CONSOLIDATING BALANCE SHEET As of March 31, 2019 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 6,442 $ — $ — $ 6,442 Receivables, net 162,111 26,232 — 188,343 Inventories, net 128,334 14,045 — 142,379 Prepaid expenses and other assets 12,512 134 — 12,646 Rental equipment, net 1,034,246 155,431 — 1,189,677 Property and equipment, net 101,467 17,292 — 118,759 Operating lease right-of-use assets, net 144,630 21,663 — 166,293 Finance lease right-of-use assets, net — 487 — 487 Deferred financing costs, net 3,347 — — 3,347 Investment in guarantor subsidiaries 235,830 — (235,830 ) — Intangible assets, net 34,729 — — 34,729 Goodwill 112,964 29,526 — 142,490 Total assets $ 1,976,612 $ 264,810 $ (235,830 ) $ 2,005,592 Liabilities and Stockholders’ Equity: Amounts due on senior secured credit facility $ 265,647 $ — $ — $ 265,647 Accounts payable 105,984 9,510 — 115,494 Manufacturer flooring plans payable 26,350 — — 26,350 Accrued expenses payable and other liabilities 64,947 (3,325 ) — 61,622 Dividends payable 147 (54 ) — 93 Senior unsecured notes, net 944,977 — — 944,977 Operating lease right-of-use liabilities 146,455 22,124 — 168,579 Finance lease right-of-use liabilities — 725 — 725 Deferred income taxes 158,090 — — 158,090 Deferred compensation payable 2,016 — — 2,016 Total liabilities 1,714,613 28,980 — 1,743,593 Stockholders’ equity 261,999 235,830 (235,830 ) 261,999 Total liabilities and stockholders’ equity $ 1,976,612 $ 264,810 $ (235,830 ) $ 2,005,592 CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2018 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 16,677 $ — $ — $ 16,677 Receivables, net 166,393 35,163 — 201,556 Inventories, net 94,483 10,115 — 104,598 Prepaid expenses and other assets 10,382 126 — 10,508 Rental equipment, net 983,281 158,217 — 1,141,498 Property and equipment, net 98,251 16,870 — 115,121 Deferred financing costs, net 3,000 — — 3,000 Investment in guarantor subsidiaries 246,309 — (246,309 ) — Intangible assets, net 28,380 — 28,380 Goodwill 76,317 29,526 — 105,843 Total assets $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 Liabilities and Stockholders’ Equity: Amounts due under senior secured credit facility $ 170,761 $ — $ — $ 170,761 Accounts payable 95,866 5,974 — 101,840 Manufacturer flooring plans payable 23,178 488 — 23,666 Accrued expenses payable and other liabilities 76,798 (3,427 ) — 73,371 Dividends payable 185 (53 ) — 132 Senior unsecured notes, net 944,780 — — 944,780 Capital leases payable — 726 — 726 Deferred income taxes 153,113 — — 153,113 Deferred compensation payable 1,989 — — 1,989 Total liabilities 1,466,670 3,708 — 1,470,378 Stockholders’ equity 256,803 246,309 (246,309 ) 256,803 Total liabilities and stockholders’ equity $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 |
Condensed Consolidating Statement of Income | CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended March 31, 2019 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 153,533 $ 22,596 $ — $ 176,129 New equipment sales 52,575 6,528 — 59,103 Used equipment sales 25,212 4,422 — 29,634 Parts sales 26,554 3,874 — 30,428 Services revenues 13,166 2,402 — 15,568 Other 1,393 1,383 — 2,776 Total revenues 272,433 41,205 — 313,638 Cost of revenues: Rental depreciation 49,263 7,885 — 57,148 Rental expense 21,152 3,616 — 24,768 Rental other 14,063 2,212 16,275 84,478 13,713 — 98,191 New equipment sales 46,460 5,639 — 52,099 Used equipment sales 16,211 2,801 — 19,012 Parts sales 19,591 2,698 — 22,289 Services revenues 4,282 722 — 5,004 Other 2,710 633 — 3,343 Total cost of revenues 173,732 26,206 — 199,938 Gross profit (loss): Equipment rentals 69,055 8,883 — 77,938 New equipment sales 6,115 889 — 7,004 Used equipment sales 9,001 1,621 — 10,622 Parts sales 6,963 1,176 — 8,139 Services revenues 8,884 1,680 — 10,564 Other (1,317 ) 750 — (567 ) Gross profit 98,701 14,999 — 113,700 Selling, general and administrative expenses 68,556 10,091 — 78,647 Merger costs 119 — — 119 Equity in earnings of guarantor subsidiaries 1,724 — (1,724 ) — Gain on sales of property and equipment, net 707 34 — 741 Income from operations 32,457 4,942 (1,724 ) 35,675 Other income (expense): Interest expense (13,562 ) (3,293 ) — (16,855 ) Other, net 457 75 — 532 Total other expense, net (13,105 ) (3,218 ) — (16,323 ) Income before income taxes 19,352 1,724 (1,724 ) 19,352 Income tax expense 5,109 — — 5,109 Net income $ 14,243 $ 1,724 $ (1,724 ) $ 14,243 CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended March 31, 2018 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 117,184 $ 19,854 $ — $ 137,038 New equipment sales 39,901 6,592 — 46,493 Used equipment sales 20,226 4,627 — 24,853 Parts sales 24,347 3,804 — 28,151 Services revenues 12,782 2,254 — 15,036 Other 7,592 1,319 — 8,911 Total revenues 222,032 38,450 — 260,482 Cost of revenues: Rental depreciation 39,559 6,910 — 46,469 Rental expense 18,261 3,011 — 21,272 Rental other 9,889 2,211 12,100 67,709 12,132 — 79,841 New equipment sales 35,083 5,762 — 40,845 Used equipment sales 13,832 3,105 — 16,937 Parts sales 17,956 2,661 — 20,617 Services revenues 4,361 689 — 5,050 Other 4,027 580 — 4,607 Total cost of revenues 142,968 24,929 — 167,897 Gross profit (loss): Equipment rentals 49,475 7,722 — 57,197 New equipment sales 4,818 830 — 5,648 Used equipment sales 6,394 1,522 — 7,916 Parts sales 6,391 1,143 — 7,534 Services revenues 8,421 1,565 — 9,986 Other 3,565 739 — 4,304 Gross profit 79,064 13,521 — 92,585 Selling, general and administrative expenses 55,009 10,871 — 65,880 Merger costs 152 — — 152 Equity in earnings of guarantor subsidiaries 458 — (458 ) — Gain on sales of property and equipment, net 714 59 — 773 Income from operations 25,075 2,709 (458 ) 27,326 Other income (expense): Interest expense (12,349 ) (2,304 ) — (14,653 ) Other, net 342 53 — 395 Total other expense, net (12,007 ) (2,251 ) — (14,258 ) Income before income taxes 13,068 458 (458 ) 13,068 Income tax benefit 3,590 — — 3,590 Net income $ 9,478 $ 458 $ (458 ) $ 9,478 |
Condensed Consolidating Statement of Cash Flows | CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2019 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 14,243 $ 1,724 $ (1,724 ) $ 14,243 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 5,692 787 — 6,479 Depreciation of rental equipment 49,263 7,885 — 57,148 Amortization of finance lease right-of-use assets — 41 — 41 Amortization of intangible assets 952 — — 952 Amortization of deferred financing costs 254 — — 254 Accretion of note discount, net of premium amortization 120 — — 120 Operating lease right-of-use liabilities, net 113 33 146 Provision for losses on accounts receivable 1,112 189 — 1,301 Provision for inventory obsolescence 42 — — 42 Change in deferred income taxes 4,977 — — 4,977 Stock-based compensation expense 1,188 — — 1,188 Gain from sales of property and equipment, net (707 ) (34 ) — (741 ) Gain from sales of rental equipment, net (9,004 ) (1,617 ) — (10,621 ) Equity in earnings of guarantor subsidiaries (1,724 ) — 1,724 — Changes in operating assets and liabilities: Receivables 8,863 8,742 — 17,605 Inventories (51,703 ) (6,359 ) — (58,062 ) Prepaid expenses and other assets (2,109 ) (8 ) — (2,117 ) Accounts payable 10,003 3,536 — 13,539 Manufacturer flooring plans payable 3,172 (488 ) — 2,684 Accrued expenses payable and other liabilities (10,667 ) 530 — (10,137 ) Deferred compensation payable 27 — — 27 Net cash provided by operating activities 24,107 14,961 — 39,068 Cash flows from investing activities: Acquisition of business, net of cash acquired (106,746 ) — (106,746 ) Purchases of property and equipment (5,446 ) (1,775 ) — (7,221 ) Purchases of rental equipment (43,311 ) (5,333 ) — (48,644 ) Proceeds from sales of property and equipment 859 72 — 931 Proceeds from sales of rental equipment 24,012 4,280 — 28,292 Investment in subsidiaries 12,203 — (12,203 ) — Net cash used in investing activities. (118,429 ) (2,756 ) (12,203 ) (133,388 ) Cash flows from financing activities: Borrowings on senior secured credit facility 447,503 — — 447,503 Payments on senior secured credit facility (352,617 ) — — (352,617 ) Dividends paid (9,831 ) (1 ) — (9,832 ) Purchases of treasury stock (387 ) — — (387 ) Payment of deferred financing costs (525 ) — — (525 ) Payments on finance lease obligations (56 ) (1 ) — (57 ) Capital contributions — (12,203 ) 12,203 — Net cash provided by (used in) financing activities 84,087 (12,205 ) 12,203 84,085 Net decrease in cash (10,235 ) — — (10,235 ) Cash, beginning of period 16,677 — — 16,677 Cash, end of period $ 6,442 $ — $ — $ 6,442 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2018 H&E Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 9,478 $ 458 $ (458 ) $ 9,478 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 5,163 721 — 5,884 Depreciation of rental equipment 39,559 6,910 — 46,469 Amortization of intangible assets 705 705 Amortization of deferred financing costs 289 — — 289 Accretion of note discount, net of premium amortization 120 — — 120 Provision for losses on accounts receivable 593 224 — 817 Provision for inventory obsolescence 67 — — 67 Change in deferred income taxes 4,456 — — 4,456 Stock-based compensation expense 1,319 — — 1,319 Gain from sales of property and equipment, net (714 ) (59 ) — (773 ) Gain from sales of rental equipment, net (6,228 ) (1,517 ) — (7,745 ) Equity in earnings of guarantor subsidiaries (458 ) — 458 — Changes in operating assets and liabilities: Receivables 11,687 10,727 — 22,414 Inventories (78,456 ) (10,218 ) — (88,674 ) Prepaid expenses and other assets (2,175 ) (62 ) — (2,237 ) Accounts payable 45,770 (386 ) — 45,384 Manufacturer flooring plans payable 7,143 (1,033 ) — 6,110 Accrued expenses payable and other liabilities (15,286 ) (513 ) — (15,799 ) Deferred compensation payable 22 — — 22 Net cash provided by operating activities 23,054 5,252 — 28,306 Cash flows from investing activities: Acquisition of business, net of cash acquired (125,207 ) — — (125,207 ) Purchases of property and equipment (4,301 ) (204 ) — (4,505 ) Purchases of rental equipment (36,688 ) (3,966 ) — (40,654 ) Proceeds from sales of property and equipment 726 59 — 785 Proceeds from sales of rental equipment 18,901 4,529 — 23,430 Investment in subsidiaries 5,613 — (5,613 ) — Net cash provided by (used in) investing activities (140,956 ) 418 (5,613 ) (146,151 ) Cash flows from financing activities: Borrowings on senior secured credit facility 294,229 — — 294,229 Payments on senior secured credit facility (294,229 ) — — (294,229 ) Dividends paid (9,804 ) — — (9,804 ) Payments of deferred financing costs (88 ) — — (88 ) Payments on capital lease obligations — (57 ) — (57 ) Capital contributions — (5,613 ) 5,613 — Net cash used in financing activities (9,892 ) (5,670 ) 5,613 (9,949 ) Net decrease in cash (127,794 ) — — (127,794 ) Cash, beginning of period 165,878 — — 165,878 Cash, end of period $ 38,084 $ — $ — $ 38,084 |
Organization and Nature of Op_4
Organization and Nature of Operations - Summary of Revenues, Cost of Revenues and Gross Profit as Previously Reported (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues: | |||
Revenues | $ 313,638 | $ 260,482 | $ 226,828 |
Cost of revenues: | |||
Cost of revenues | 199,938 | 167,897 | |
Gross Profit | 113,700 | 92,585 | |
As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 260,482 | ||
Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 260,482 | ||
Cost of revenues: | |||
Cost of revenues | 167,897 | ||
Gross Profit | 92,585 | ||
Equipment Rentals [Member] | |||
Revenues: | |||
Revenues | 137,038 | ||
Equipment Rentals [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 129,361 | ||
Equipment Rentals [Member] | Accounting Standards Update 2014-09 | Hauling Fees [Member] | |||
Revenues: | |||
Revenues | 7,677 | ||
New Equipment Sales [Member] | |||
Revenues: | |||
Revenues | 59,103 | 46,493 | |
Cost of revenues: | |||
Cost of revenues | 40,845 | ||
New Equipment Sales [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 46,493 | ||
New Equipment Sales [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 46,493 | ||
Cost of revenues: | |||
Cost of revenues | 40,845 | ||
Used Equipment Sales [Member] | |||
Revenues: | |||
Revenues | 29,634 | 24,853 | |
Cost of revenues: | |||
Cost of revenues | 16,937 | ||
Used Equipment Sales [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 24,853 | ||
Used Equipment Sales [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 24,853 | ||
Cost of revenues: | |||
Cost of revenues | 16,937 | ||
Parts Sales [Member] | |||
Revenues: | |||
Revenues | 30,428 | 28,151 | |
Cost of revenues: | |||
Cost of revenues | 20,617 | ||
Parts Sales [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 28,151 | ||
Parts Sales [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 28,151 | ||
Cost of revenues: | |||
Cost of revenues | 20,617 | ||
Parts and Services [Member] | |||
Revenues: | |||
Revenues | 15,568 | 15,036 | |
Cost of revenues: | |||
Cost of revenues | 5,050 | ||
Parts and Services [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 15,036 | ||
Parts and Services [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 15,036 | ||
Cost of revenues: | |||
Cost of revenues | 5,050 | ||
Other [Member] | |||
Revenues: | |||
Revenues | $ 2,776 | 8,911 | |
Cost of revenues: | |||
Cost of revenues | 4,607 | ||
Other [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 8,911 | ||
Other [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 16,588 | ||
Cost of revenues: | |||
Cost of revenues | 16,707 | ||
Other [Member] | Accounting Standards Update 2014-09 | Hauling Fees [Member] | |||
Revenues: | |||
Revenues | (7,677) | ||
Cost of revenues: | |||
Cost of revenues | (12,100) | ||
Rental Depreciation [Member] | |||
Cost of revenues: | |||
Cost of revenues | 46,469 | ||
Rental Depreciation [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Cost of revenues: | |||
Cost of revenues | 46,469 | ||
Rental Expense [Member] | |||
Cost of revenues: | |||
Cost of revenues | 21,272 | ||
Rental Expense [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Cost of revenues: | |||
Cost of revenues | 21,272 | ||
Rentals Other [Member] | |||
Cost of revenues: | |||
Cost of revenues | 12,100 | ||
Rentals Other [Member] | Accounting Standards Update 2014-09 | Hauling Fees [Member] | |||
Cost of revenues: | |||
Cost of revenues | 12,100 | ||
Equipment Rentals [Member] | |||
Cost of revenues: | |||
Cost of revenues | 79,841 | ||
Equipment Rentals [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Cost of revenues: | |||
Cost of revenues | 67,741 | ||
Equipment Rentals [Member] | Accounting Standards Update 2014-09 | Hauling Fees [Member] | |||
Cost of revenues: | |||
Cost of revenues | $ 12,100 |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2019USD ($)Customer | Mar. 31, 2018Customer | Dec. 31, 2018Customer | Jan. 01, 2019USD ($) | |
Summary Of Significant Accounting Policy [Line Items] | ||||
Adjustment to retained earnings | $ 73,647,000 | |||
Additional operating lease liabilities, net of deferred rent | 168,579,000 | |||
Right-of-use operating lease assets | 166,293,000 | |||
Finance lease liabilities recognized | 725,000 | |||
Finance right-of-use lease assets | $ 487,000 | |||
Customer accounted for more than 10% of revenue | Customer | 0 | 0 | 0 | |
Bad debt expense as a percentage of total revenues | 0.40% | 0.30% | ||
ASU 2016-02 [Member] | ||||
Summary Of Significant Accounting Policy [Line Items] | ||||
Lease term | 12 months | |||
Additional operating lease liabilities, net of deferred rent | $ 162,800,000 | |||
Right-of-use operating lease assets | 162,800,000 | |||
Finance lease liabilities recognized | 800,000 | |||
Finance right-of-use lease assets | $ 500,000 | |||
ASU 2016-02 [Member] | Maximum [Member] | ||||
Summary Of Significant Accounting Policy [Line Items] | ||||
Adjustment to retained earnings | $ 100,000 |
Significant Accounting Polici_5
Significant Accounting Policies - Summary of Revenue by Type and by Applicable Accounting Standard (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues: | |||
Revenues | $ 313,638 | $ 260,482 | $ 226,828 |
As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 260,482 | ||
ASU 2016-02 [Member] | |||
Revenues: | |||
Revenues | 166,873 | ||
Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 146,765 | 125,376 | |
Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 260,482 | ||
Topic 840 [Member] | |||
Revenues: | |||
Revenues | 135,106 | ||
Rental Revenues [Member] | Owned Equipment Rentals [Member] | |||
Revenues: | |||
Revenues | 153,624 | ||
Rental Revenues [Member] | Owned Equipment Rentals [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 124,256 | ||
Rental Revenues [Member] | Owned Equipment Rentals [Member] | ASU 2016-02 [Member] | |||
Revenues: | |||
Revenues | 153,350 | ||
Rental Revenues [Member] | Owned Equipment Rentals [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 274 | 522 | |
Rental Revenues [Member] | Owned Equipment Rentals [Member] | Topic 840 [Member] | |||
Revenues: | |||
Revenues | 123,734 | ||
Rental Revenues [Member] | Re Rent Revenues [Member] | |||
Revenues: | |||
Revenues | 6,036 | ||
Rental Revenues [Member] | Re Rent Revenues [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 5,105 | ||
Rental Revenues [Member] | Re Rent Revenues [Member] | ASU 2016-02 [Member] | |||
Revenues: | |||
Revenues | 6,036 | ||
Rental Revenues [Member] | Re Rent Revenues [Member] | Topic 840 [Member] | |||
Revenues: | |||
Revenues | 5,105 | ||
Ancillary And Other Rental Revenues [Member] | |||
Revenues: | |||
Revenues | 16,469 | ||
Ancillary And Other Rental Revenues [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 7,677 | ||
Ancillary And Other Rental Revenues [Member] | ASU 2016-02 [Member] | |||
Revenues: | |||
Revenues | 7,487 | ||
Ancillary And Other Rental Revenues [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 8,982 | 7,677 | |
Ancillary And Other Rental Revenues [Member] | Delivery and Pick-up [Member] | |||
Revenues: | |||
Revenues | 8,982 | ||
Ancillary And Other Rental Revenues [Member] | Delivery and Pick-up [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 7,677 | ||
Ancillary And Other Rental Revenues [Member] | Delivery and Pick-up [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 8,982 | 7,677 | |
Ancillary And Other Rental Revenues [Member] | Other [Member] | |||
Revenues: | |||
Revenues | 7,487 | ||
Ancillary And Other Rental Revenues [Member] | Other [Member] | ASU 2016-02 [Member] | |||
Revenues: | |||
Revenues | 7,487 | ||
Total Equipment Rental Revenues [Member] | |||
Revenues: | |||
Revenues | 176,129 | ||
Total Equipment Rental Revenues [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 137,038 | ||
Total Equipment Rental Revenues [Member] | ASU 2016-02 [Member] | |||
Revenues: | |||
Revenues | 166,873 | ||
Total Equipment Rental Revenues [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 9,256 | 8,199 | |
Total Equipment Rental Revenues [Member] | Topic 840 [Member] | |||
Revenues: | |||
Revenues | 128,839 | ||
New Equipment Sales [Member] | |||
Revenues: | |||
Revenues | 59,103 | 46,493 | |
New Equipment Sales [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 46,493 | ||
New Equipment Sales [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 59,103 | 46,493 | |
New Equipment Sales [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 46,493 | ||
Used Equipment Sales [Member] | |||
Revenues: | |||
Revenues | 29,634 | 24,853 | |
Used Equipment Sales [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 24,853 | ||
Used Equipment Sales [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 29,634 | 24,853 | |
Used Equipment Sales [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 24,853 | ||
Parts Sales [Member] | |||
Revenues: | |||
Revenues | 30,428 | 28,151 | |
Parts Sales [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 28,151 | ||
Parts Sales [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 30,428 | 28,151 | |
Parts Sales [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 28,151 | ||
Parts and Services [Member] | |||
Revenues: | |||
Revenues | 15,568 | 15,036 | |
Parts and Services [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 15,036 | ||
Parts and Services [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | 15,568 | 15,036 | |
Parts and Services [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 15,036 | ||
Other [Member] | |||
Revenues: | |||
Revenues | 2,776 | 8,911 | |
Other [Member] | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 8,911 | ||
Other [Member] | Accounting Standards Update 2014-09 | |||
Revenues: | |||
Revenues | $ 2,776 | 2,644 | |
Other [Member] | Accounting Standards Update 2014-09 | As Previously Reported [Member] | |||
Revenues: | |||
Revenues | 16,588 | ||
Other [Member] | Topic 840 [Member] | |||
Revenues: | |||
Revenues | $ 6,267 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) $ / shares in Units, $ in Thousands | Feb. 01, 2019USD ($)BranchReportingUnit | Apr. 01, 2018USD ($)BranchReportingUnit | Jan. 01, 2018USD ($)BranchReportingUnit | Mar. 31, 2019USD ($)Location$ / shares | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | |||||||
Number of branches located | Location | 96 | ||||||
Acquisition costs | $ 119 | $ 152 | |||||
Goodwill | 142,490 | $ 105,843 | |||||
Total revenues | 313,638 | 260,482 | $ 226,828 | ||||
Net income | 14,243 | $ 9,478 | |||||
CEC [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business acquisition, completion date | Jan. 1, 2018 | ||||||
Number of branches located | Branch | 3 | ||||||
Aggregate consideration paid to the owners | $ 132,400 | ||||||
Percentage of goodwill deductible for income tax purposes | 100.00% | ||||||
Acquisition costs | $ 1,000 | ||||||
Goodwill | $ 45,092 | ||||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||||
Rental Inc [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business acquisition, completion date | Apr. 1, 2018 | ||||||
Number of branches located | Branch | 5 | ||||||
Aggregate consideration paid to the owners | $ 68,600 | ||||||
Percentage of goodwill deductible for income tax purposes | 100.00% | ||||||
Acquisition costs | $ 300 | ||||||
Goodwill | $ 29,554 | ||||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||||
Rental Inc [Member] | Purchase Agreement [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Accrued purchase price consideration included in goodwill | $ 3,400 | ||||||
We-Rent-It [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business acquisition, completion date | Feb. 1, 2019 | ||||||
Number of branches located | Branch | 6 | ||||||
Aggregate consideration paid to the owners | $ 108,500 | ||||||
Percentage of goodwill deductible for income tax purposes | 100.00% | ||||||
Acquisition costs | $ 300 | ||||||
Goodwill | $ 36,647 | ||||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||||
Total revenues | 5,900 | ||||||
Net income | $ 800 | ||||||
Net income per share | $ / shares | $ 0.02 |
Acquisitions - Summary of Estim
Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Feb. 01, 2019 | Dec. 31, 2018 | Apr. 01, 2018 | Jan. 01, 2018 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 142,490 | $ 105,843 | |||
CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 1,244 | ||||
Accounts receivable | 7,583 | ||||
Inventory | 504 | ||||
Prepaid expenses and other assets | 324 | ||||
Rental equipment | 55,342 | ||||
Property and equipment | 2,700 | ||||
Intangible assets | 21,500 | ||||
Total identifiable assets acquired | 89,197 | ||||
Accounts payable | (1,023) | ||||
Accrued expenses payable and other liabilities | (876) | ||||
Total liabilities assumed | (1,899) | ||||
Net identifiable assets acquired | 87,298 | ||||
Goodwill | 45,092 | ||||
Net assets acquired | $ 132,390 | ||||
Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 260 | ||||
Accounts receivable | 2,873 | ||||
Inventory | 5,324 | ||||
Prepaid expenses and other assets | 47 | ||||
Rental equipment | 22,578 | ||||
Property and equipment | 1,935 | ||||
Intangible assets | 10,200 | ||||
Total identifiable assets acquired | 43,217 | ||||
Accounts payable | (439) | ||||
Manufacturer flooring plans payable | (3,293) | ||||
Accrued expenses payable and other liabilities | (469) | ||||
Total liabilities assumed | (4,201) | ||||
Net identifiable assets acquired | 39,016 | ||||
Goodwill | 29,554 | ||||
Net assets acquired | $ 68,570 | ||||
We-Rent-It [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 1,745 | ||||
Accounts receivable | 5,149 | ||||
Inventory | 873 | ||||
Prepaid expenses and other assets | 544 | ||||
Rental equipment | 53,242 | ||||
Property and equipment | 3,959 | ||||
Other assets | 21 | ||||
Intangible assets | 7,300 | ||||
Total identifiable assets acquired | 72,833 | ||||
Accounts payable | (115) | ||||
Accrued expenses payable and other liabilities | (874) | ||||
Total liabilities assumed | (989) | ||||
Net identifiable assets acquired | 71,844 | ||||
Goodwill | 36,647 | ||||
Net assets acquired | $ 108,491 |
Acquisitions - Summary of Est_2
Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Parenthetical) (Detail) $ in Thousands | Feb. 01, 2019USD ($)ReportingUnit | Apr. 01, 2018USD ($)ReportingUnit | Jan. 01, 2018USD ($)ReportingUnit | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | |||||
Goodwill | $ 142,490 | $ 105,843 | |||
CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 21,500 | ||||
Goodwill | $ 45,092 | ||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||
CEC [Member] | Rental Component 1 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 25,233 | ||||
CEC [Member] | Rental Component 2 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 18,391 | ||||
CEC [Member] | New Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 217 | ||||
CEC [Member] | Used Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 632 | ||||
CEC [Member] | Parts [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 379 | ||||
CEC [Member] | Service [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 240 | ||||
Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 10,200 | ||||
Goodwill | $ 29,554 | ||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||
Rental Inc [Member] | Rental Component 1 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 9,064 | ||||
Rental Inc [Member] | Rental Component 2 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 5,445 | ||||
Rental Inc [Member] | New Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 10,217 | ||||
Rental Inc [Member] | Used Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 1,692 | ||||
Rental Inc [Member] | Parts [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 2,171 | ||||
Rental Inc [Member] | Service [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 964 | ||||
We-Rent-It [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 36,647 | ||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||
Customer Relationships [Member] | CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 21,000 | ||||
Life (years) | 10 years | ||||
Customer Relationships [Member] | Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 10,000 | ||||
Life (years) | 10 years | ||||
Customer Relationships [Member] | We-Rent-It [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 7,300 | ||||
Life (years) | 10 years | ||||
Tradenames [Member] | CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 300 | ||||
Life (years) | 1 year | ||||
Tradenames [Member] | Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 200 | ||||
Life (years) | 1 year | ||||
Leasehold Interests [Member] | CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 200 | ||||
Life (years) | 10 years |
Acquisitions - Unaudited Pro Fo
Acquisitions - Unaudited Pro Forma Consolidated Statements of Income Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | |
Business Acquisition [Line Items] | |||
Total revenues | $ 313,638 | $ 260,482 | $ 226,828 |
Pretax income | 19,352 | 13,068 | 8,530 |
Pro forma pretax income (loss) | 13,068 | 8,530 | |
Income tax expense (benefit) | 3,590 | 3,140 | |
Net income (loss) | $ 9,478 | $ 5,390 | |
Net income per share - basic | $ 0.27 | $ 0.15 | |
Net income per share – diluted | $ 0.26 | $ 0.15 | |
Pro forma adjustments to pretax income: | |||
Total revenues | $ 268,069 | $ 235,217 | |
Pretax income | 13,852 | 9,971 | |
Pro forma adjustments to pretax income: | |||
Impact of fair value mark-ups/useful life changes on depreciation | (250) | (903) | |
Intangible asset amortization | (122) | (705) | |
Pro forma pretax income (loss) | 12,204 | 8,363 | |
Interest expense | (1,356) | ||
Elimination of historic interest expense | 80 | ||
Income tax expense (benefit) | 3,355 | 3,077 | |
Net income (loss) | $ 8,849 | $ 5,286 | |
Net income per share - basic | $ 0.25 | $ 0.15 | |
Net income per share – diluted | $ 0.25 | $ 0.15 | |
CEC [Member] | |||
Business Acquisition [Line Items] | |||
Total revenues | $ 8,389 | ||
Pretax income | 1,441 | ||
Pro forma adjustments to pretax income: | |||
Impact of fair value mark-ups/useful life changes on depreciation | (903) | ||
Intangible asset amortization | (705) | ||
Pro forma pretax income (loss) | (167) | ||
Income tax expense (benefit) | (63) | ||
Net income (loss) | $ (104) | ||
We-Rent-It [Member] | |||
Business Acquisition [Line Items] | |||
Total revenues | $ 5,900 | ||
Total revenues | $ 7,587 | ||
Pretax income | 784 | ||
Pro forma adjustments to pretax income: | |||
Impact of fair value mark-ups/useful life changes on depreciation | (250) | ||
Intangible asset amortization | (122) | ||
Pro forma pretax income (loss) | (864) | ||
Interest expense | (1,356) | ||
Elimination of historic interest expense | 80 | ||
Income tax expense (benefit) | (235) | ||
Net income (loss) | $ (629) | ||
Net income per share - basic | $ (0.02) | ||
Net income per share – diluted | $ (0.02) |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Estimated Incremental Borrowing Rates for Similar Types of Borrowing Arrangements (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Level 3 [Member] | Carrying Amount [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) | $ 26,350 | $ 23,666 |
Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) | 726 | |
Level 3 [Member] | Fair Value [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) | 22,281 | 19,870 |
Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) | 330 | |
Letter of credit (Level 3) | 97 | 116 |
Level 2 [Member] | Carrying Amount [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes with interest computed at 5.625% (Level 2) | 944,977 | 944,780 |
Level 2 [Member] | Fair Value [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes with interest computed at 5.625% (Level 2) | $ 947,625 | $ 871,625 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Estimated Incremental Borrowing Rates for Similar Types of Borrowing Arrangements (Parenthetical) (Detail) | Mar. 31, 2019 | Dec. 31, 2018 |
Level 3 [Member] | Carrying Amount [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable, interest rate | 5.50% | 5.50% |
Capital lease payable, interest rate, minimum | 5.929% | |
Capital lease payable interest rate, maximum | 9.55% | |
Level 3 [Member] | Fair Value [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable, interest rate | 5.50% | 5.50% |
Capital lease payable, interest rate, minimum | 5.929% | |
Capital lease payable interest rate, maximum | 9.55% | |
Level 2 [Member] | Carrying Amount [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes, interest rate | 5.625% | 5.625% |
Level 2 [Member] | Fair Value [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes, interest rate | 5.625% | 5.625% |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | ||
Transfer of financial assets | $ 0 | $ 0 |
Transfer of financial liabilities | $ 0 | $ 0 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Activity in Stockholders' Equity (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Schedule of Capitalization, Equity [Line Items] | ||
Beginning Balances | $ 256,803 | $ 216,793 |
Beginning Balances, shares | 39,748,562 | |
Stock-based compensation | $ 1,188 | 1,319 |
Cash dividends declared on common stock ($0.275 per share) | (9,793) | (9,845) |
Issuance of common stock, net of forfeitures | 1 | |
Repurchase of 14,272 shares of restricted common stock | (387) | |
Cumulative effect adjustment pursuant to the adoption of ASC 842 | (56) | |
Net income | 14,243 | 9,478 |
Ending Balances | $ 261,999 | 217,745 |
Ending Balances, shares | 39,808,072 | |
Common Stock [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
Beginning Balances | $ 396 | $ 395 |
Beginning Balances, shares | 39,748,562 | 39,623,773 |
Issuance of common stock, net of forfeitures | $ 1 | $ 9,534 |
Issuance of common stock, net of forfeitures, shares | 59,510 | |
Ending Balances | $ 397 | $ 395 |
Ending Balances, shares | 39,808,072 | 39,633,307 |
Additional Paid-in Capital [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
Beginning Balances | $ 231,174 | $ 227,070 |
Stock-based compensation | 1,188 | 1,319 |
Ending Balances | 232,362 | 228,389 |
Treasury Stock [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
Beginning Balances | (63,099) | (61,749) |
Repurchase of 14,272 shares of restricted common stock | (387) | |
Ending Balances | (63,486) | (61,749) |
Retained Earnings [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
Beginning Balances | 88,332 | 51,077 |
Cash dividends declared on common stock ($0.275 per share) | (9,793) | (9,845) |
Cumulative effect adjustment pursuant to the adoption of ASC 842 | (56) | |
Net income | 14,243 | 9,478 |
Ending Balances | $ 92,726 | $ 50,710 |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Activity in Stockholders' Equity (Parenthetical) (Detail) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Schedule of Capitalization, Equity [Line Items] | ||
Cash dividends declared on common stock, per share | $ 0.275 | $ 0.275 |
Repurchase of restricted common stock, shares | 14,272 | |
Retained Earnings [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
Cash dividends declared on common stock, per share | $ 0.275 | $ 0.275 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($)shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized compensation expense related to non-vested stock | $ | $ 4.2 |
Expected non-vested stock recognized over a weighted-average period | 1 year 8 months 12 days |
2016 Stock-Based Incentive Compensation Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Stock-Based incentive compensation plan | shares | 1,760,106 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Non-Vested Stock Activity (Detail) | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Non-vested stock, beginning balance, Number of Shares | shares | 379,559 |
Granted, Number of Shares | shares | 20,923 |
Vested, Number of Shares | shares | (57,296) |
Forfeited, Number of Shares | shares | (25,120) |
Non-vested stock, ending balance, Number of Shares | shares | 318,066 |
Non-vested stock, beginning balance, Weighted Average Grant Date Fair Value | $ / shares | $ 25.87 |
Granted, Weighted Average Grant Date Fair Value | $ / shares | 26.77 |
Vested, Weighted Average Grant Date Fair Value | $ / shares | 21.60 |
Forfeited, Weighted Average Grant Date Fair Value | $ / shares | 19.80 |
Non-vested stock, ending balance, Weighted Average Grant Date Fair Value | $ / shares | $ 27.18 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Compensation Expense Related to Non-Vested Stock (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Compensation expense | $ 1,188 | $ 1,319 |
Income per Share - Additional I
Income per Share - Additional Information (Detail) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Earnings Per Share [Abstract] | ||
Restricted common shares, percentage | 0.70% | 0.70% |
Income per Share - Summary of C
Income per Share - Summary of Computation of Basic and Diluted Net Income Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Basic net income per share: | ||
Net income | $ 14,243 | $ 9,478 |
Weighted average number of common shares outstanding | 35,787 | 35,592 |
Net income per share of common stock – basic | $ 0.40 | $ 0.27 |
Diluted net income per share: | ||
Net income | $ 14,243 | $ 9,478 |
Weighted average number of common shares outstanding | 35,787 | 35,592 |
Effect of dilutive securities: | ||
Weighted average number of common shares outstanding – diluted | 35,973 | 35,879 |
Net income per share of common stock – diluted | $ 0.40 | $ 0.26 |
Non-vested restricted stock [Member] | ||
Effect of dilutive securities: | ||
Effect of dilutive stock options and non-vested restricted stock | 186 | 287 |
Common shares excluded from the denominator as anti-dilutive: | ||
Common shares excluded from the denominator as anti-dilutive | 37 |
Senior Secured Credit Facility
Senior Secured Credit Facility - Additional Information (Detail) - USD ($) | Feb. 01, 2019 | Dec. 22, 2017 | Dec. 21, 2017 | Mar. 31, 2019 | Apr. 22, 2019 |
Wells Fargo Capital Finance, LLC [Member] | Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Existing credit facility with its lenders | $ 750,000,000 | ||||
Revolving Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Existing credit facility with its lenders | $ 750,000,000 | $ 602,500,000 | |||
Debt instrument maturity date description | extended the maturity date of the credit facility from December 22, 2022 to January 31, 2024 | extended the maturity date of the Credit Facility from May 21, 2019 to December 22, 2022 | |||
Debt instrument maturity date | Jan. 31, 2024 | Dec. 22, 2022 | May 21, 2019 | ||
Uncommitted incremental revolving capacity | $ 250,000,000 | $ 150,000,000 | |||
Outstanding letters of credit | $ 265,600,000 | ||||
Available borrowings under our senior secured credit facility | $ 476,700,000 | ||||
Revolving Credit Facility [Member] | Subsequent Event [Member] | |||||
Debt Instrument [Line Items] | |||||
Outstanding letters of credit | $ 7,700,000 | ||||
Available borrowings under our senior secured credit facility | $ 462,100,000 | ||||
Revolving Credit Facility [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Unused commitment fee margin percentage | 0.375% | ||||
Revolving Credit Facility [Member] | Maximum [Member] | Letter of Credit [Member] | |||||
Debt Instrument [Line Items] | |||||
Margin rate lowered in applicable to Letter of Credit | 2.00% | ||||
Revolving Credit Facility [Member] | Maximum [Member] | Base Rate [Member] | |||||
Debt Instrument [Line Items] | |||||
Applicable margin Percentage | 0.75% | 1.00% | |||
Revolving Credit Facility [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||
Debt Instrument [Line Items] | |||||
Applicable margin Percentage | 1.75% | 2.00% | |||
Revolving Credit Facility [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Unused commitment fee margin percentage | 0.25% | ||||
Revolving Credit Facility [Member] | Minimum [Member] | Letter of Credit [Member] | |||||
Debt Instrument [Line Items] | |||||
Margin rate lowered in applicable to Letter of Credit | 1.50% | ||||
Revolving Credit Facility [Member] | Minimum [Member] | Base Rate [Member] | |||||
Debt Instrument [Line Items] | |||||
Applicable margin Percentage | 0.25% | 0.50% | |||
Revolving Credit Facility [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||
Debt Instrument [Line Items] | |||||
Applicable margin Percentage | 1.25% | 1.50% | |||
Letter of Credit Sub-Facility, and Guaranty [Member] | |||||
Debt Instrument [Line Items] | |||||
Existing credit facility with its lenders | $ 30,000,000 |
Senior Unsecured Notes - Additi
Senior Unsecured Notes - Additional Information (Detail) - USD ($) | Nov. 22, 2017 | Sep. 25, 2017 | Aug. 24, 2017 | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | |||||
Estimated offering expenses | $ 3,347,000 | $ 3,000,000 | |||
Add-on Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 200,000,000 | ||||
Senior unsecured notes, interest rate | 5.625% | ||||
Senior unsecured notes, maturity year | 2025 | ||||
Net proceeds from sale of notes | $ 209,200 | ||||
Price percentage for Add-on Notes, Principal amount | 104.25% | ||||
5.6250% Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 750,000,000 | ||||
Senior unsecured notes, interest rate | 5.625% | ||||
Senior unsecured notes, maturity year | 2025 | ||||
Estimated offering expenses | $ 10,300,000 | ||||
Net proceeds from sale of notes | $ 739,700,000 | ||||
Redemption price percentage as equal to principal amount of old notes to be redeemed | 101.00% | ||||
Principal payments due until maturity | $ 0 | ||||
Maturity date of notes | Sep. 1, 2025 | ||||
Debt instrument, Payment terms | The New Notes were issued at par and require semiannual interest payments on March 1st and September 1st of each year, commencing on March 1, 2018. No principal payments are due until maturity (September 1, 2025). | ||||
Debt Instrument, Redemption description | The New Notes are redeemable, in whole or in part, at any time on or after September 1, 2020 at specified redemption prices plus accrued and unpaid interest to the date of redemption. We may redeem up to 40% of the aggregate principal amount of the New Notes before September 1, 2020 with the net cash proceeds from certain equity offerings. We may also redeem the New Notes prior to September 1, 2020 at a specified “make-whole” redemption price plus accrued and unpaid interest to the date of redemption. | ||||
5.6250% Senior Notes [Member] | Maximum [Member] | Before September 1, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Percentage of principal amount of new notes may be redeemed | 40.00% | ||||
7% Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Senior unsecured notes, interest rate | 7.00% | ||||
Senior unsecured notes, maturity year | 2022 | ||||
Repurchase of notes | $ 329,700,000 | ||||
Early tender deadline amount received on debt instrument | 1,038.90 | ||||
Principal amount of old notes | $ 1,000 | ||||
Remaining principal amount outstanding of old notes redeemed | $ 300,300,000 | ||||
Redemption price percentage as equal to principal amount of old notes to be redeemed | 103.50% |
Senior Unsecured Notes - Reconc
Senior Unsecured Notes - Reconciliation of Senior Unsecured Notes to Condensed Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | |||
Senior unsecured notes, beginning balance | $ 944,780 | ||
Amortization of deferred financing costs | 254 | $ 289 | |
Senior unsecured notes, ending balance | 944,977 | $ 944,780 | |
Senior Unsecured Notes [Member] | |||
Debt Instrument [Line Items] | |||
Senior unsecured notes, beginning balance | 944,780 | $ 944,088 | 944,088 |
Accretion of discount | 385 | 1,539 | |
Amortization of note premium | (265) | (1,062) | |
Amortization of deferred financing costs | 77 | 312 | |
Senior unsecured notes, ending balance | $ 944,977 | 944,780 | |
Senior Unsecured Notes [Member] | 5.6250% Senior Notes [Member] | |||
Debt Instrument [Line Items] | |||
Additional deferred financing costs | $ (97) |
Leases - Additional Information
Leases - Additional Information (Detail) $ in Thousands | Mar. 31, 2019USD ($)Location |
Leases [Abstract] | |
Number of operating leases locations related to real estate and improvements | Location | 84 |
Number of branch locations | Location | 96 |
Net operating lease right-of-use assets | $ 166,293 |
Net finance lease right-of-use assets | 487 |
Operating lease liabilities | 168,579 |
Finance lease liabilities | $ 725 |
Weighted average remaining lease term for operating leases | 11 years 2 months 12 days |
Weighted average remaining lease term for finance leases | 3 years |
Weighted average discount rate for operating leases | 6.90% |
Weighted average discount rate for finance leases | 5.90% |
Leases - Summary of Lease Costs
Leases - Summary of Lease Costs for Operating and Finance Leases (Detail) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Finance lease cost | |
Amortization of leased assets | $ 41 |
Total lease cost | 5,631 |
SG&A Expenses [Member] | |
Lessee Lease Description [Line Items] | |
Operating lease cost | 5,575 |
Finance lease cost | |
Amortization of leased assets | 41 |
Variable lease cost | 124 |
Interest Expense [Member] | |
Finance lease cost | |
Interest of lease liabilities | 11 |
Other Income [Member] | |
Finance lease cost | |
Sublease income | $ (120) |
Leases - Summary of Supplementa
Leases - Summary of Supplemental Cash Flow Information Related to Leases (Detail) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities | |
Operating cash flows for operating leases | $ 5,429 |
Operating cash flows for finance leases | 11 |
Finance cash flows for finance leases | $ 57 |
Leases - Summary of Undiscounte
Leases - Summary of Undiscounted Cash Flows and Operating Lease Liabilities Recorded on Condensed Consolidated Balance Sheet (Detail) $ in Thousands | Mar. 31, 2019USD ($) |
Operating Leases | |
2019 | $ 16,533 |
2020 | 21,976 |
2021 | 21,921 |
2022 | 21,867 |
2023 | 21,823 |
Thereafter | 138,106 |
Total minimum lease payments | 242,226 |
Less: amount of lease payments representing interest | (73,647) |
Additional operating lease liabilities, net of deferred rent | 168,579 |
Finance Leases | |
2019 | 203 |
2020 | 270 |
2021 | 270 |
2022 | 45 |
Total minimum lease payments | 788 |
Less: amount of lease payments representing interest | (63) |
Finance lease liabilities recognized | $ 725 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019CustomerSegment | Mar. 31, 2018Customer | Dec. 31, 2018Customer | |
Segment Reporting [Abstract] | |||
Number of reportable segment | Segment | 5 | ||
Sales to international customers | 0.30% | 0.40% | |
Customer accounted for more than 10% of revenue | Customer | 0 | 0 | 0 |
Segment Information - Schedule
Segment Information - Schedule of Information about Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2018 | |
Segment Revenues: | ||||
Revenues | $ 313,638 | $ 260,482 | $ 226,828 | |
Segment Gross Profit: | ||||
Total gross profit | 113,700 | 92,585 | ||
Segment identified assets: | ||||
Total assets | 2,005,592 | $ 1,727,181 | ||
Equipment Rentals [Member] | ||||
Segment Revenues: | ||||
Revenues | 176,129 | 137,038 | ||
Segment Gross Profit: | ||||
Total gross profit | 77,938 | 57,197 | ||
New Equipment Sales [Member] | ||||
Segment Revenues: | ||||
Revenues | 59,103 | 46,493 | ||
Segment Gross Profit: | ||||
Total gross profit | 7,004 | 5,648 | ||
Used Equipment Sales [Member] | ||||
Segment Revenues: | ||||
Revenues | 29,634 | 24,853 | ||
Segment Gross Profit: | ||||
Total gross profit | 10,622 | 7,916 | ||
Parts Sales [Member] | ||||
Segment Revenues: | ||||
Revenues | 30,428 | 28,151 | ||
Segment Gross Profit: | ||||
Total gross profit | 8,139 | 7,534 | ||
Services Revenues [Member] | ||||
Segment Revenues: | ||||
Revenues | 15,568 | 15,036 | ||
Segment Gross Profit: | ||||
Total gross profit | 10,564 | 9,986 | ||
Operating Segments [Member] | ||||
Segment Revenues: | ||||
Revenues | 310,862 | 257,838 | ||
Segment Gross Profit: | ||||
Total gross profit | 114,267 | 92,983 | ||
Segment identified assets: | ||||
Total assets | 1,332,055 | 1,246,096 | ||
Operating Segments [Member] | Equipment Rentals [Member] | ||||
Segment Revenues: | ||||
Revenues | 176,129 | 143,305 | ||
Segment Gross Profit: | ||||
Total gross profit | 77,938 | 61,899 | ||
Segment identified assets: | ||||
Total assets | 1,189,677 | 1,141,498 | ||
Operating Segments [Member] | New Equipment Sales [Member] | ||||
Segment Revenues: | ||||
Revenues | 59,103 | 46,493 | ||
Segment Gross Profit: | ||||
Total gross profit | 7,004 | 5,648 | ||
Operating Segments [Member] | Used Equipment Sales [Member] | ||||
Segment Revenues: | ||||
Revenues | 29,634 | 24,853 | ||
Segment Gross Profit: | ||||
Total gross profit | 10,622 | 7,916 | ||
Segment identified assets: | ||||
Total assets | 122,833 | 86,583 | ||
Operating Segments [Member] | Parts Sales [Member] | ||||
Segment Revenues: | ||||
Revenues | 30,428 | 28,151 | ||
Segment Gross Profit: | ||||
Total gross profit | 8,139 | 7,534 | ||
Operating Segments [Member] | Services Revenues [Member] | ||||
Segment Revenues: | ||||
Revenues | 15,568 | 15,036 | ||
Segment Gross Profit: | ||||
Total gross profit | 10,564 | 9,986 | ||
Operating Segments [Member] | Parts and Services [Member] | ||||
Segment identified assets: | ||||
Total assets | 19,545 | 18,015 | ||
Non-Segmented [Member] | ||||
Segment Revenues: | ||||
Revenues | 2,776 | 2,644 | ||
Segment Gross Profit: | ||||
Total gross profit | (567) | $ (398) | ||
Segment identified assets: | ||||
Total assets | $ 673,537 | $ 481,085 |
Condensed Consolidating Finan_3
Condensed Consolidating Financial Information of Guarantor Subsidiaries - Condensed Consolidating Balance Sheet (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Assets: | ||||
Cash | $ 6,442 | $ 16,677 | ||
Receivables, net | 188,343 | 201,556 | ||
Inventories, net | 142,379 | 104,598 | ||
Prepaid expenses and other assets | 12,646 | 10,508 | ||
Rental equipment, net | 1,189,677 | 1,141,498 | ||
Property and equipment, net | 118,759 | 115,121 | ||
Operating lease right-of-use assets, net | 166,293 | |||
Finance lease right-of-use assets, net | 487 | |||
Deferred financing costs, net | 3,347 | 3,000 | ||
Intangible assets, net | 34,729 | 28,380 | ||
Goodwill | 142,490 | 105,843 | ||
Total assets | 2,005,592 | 1,727,181 | ||
Liabilities and Stockholders’ Equity: | ||||
Amounts due on senior secured credit facility | 265,647 | 170,761 | ||
Accounts payable | 115,494 | 101,840 | ||
Manufacturer flooring plans payable | 26,350 | 23,666 | ||
Accrued expenses payable and other liabilities | 61,622 | 73,371 | ||
Dividends payable | 93 | 132 | ||
Senior unsecured notes, net | 944,977 | 944,780 | ||
Capital leases payable | 726 | |||
Operating lease right-of-use liabilities | 168,579 | |||
Finance lease right-of-use liabilities | 725 | |||
Deferred income taxes | 158,090 | 153,113 | ||
Deferred compensation payable | 2,016 | 1,989 | ||
Total liabilities | 1,743,593 | 1,470,378 | ||
Stockholders’ equity | 261,999 | 256,803 | $ 217,745 | $ 216,793 |
Total liabilities and stockholders’ equity | 2,005,592 | 1,727,181 | ||
Reportable Legal Entities [Member] | H & E Equipment Services [Member] | ||||
Assets: | ||||
Cash | 6,442 | 16,677 | ||
Receivables, net | 162,111 | 166,393 | ||
Inventories, net | 128,334 | 94,483 | ||
Prepaid expenses and other assets | 12,512 | 10,382 | ||
Rental equipment, net | 1,034,246 | 983,281 | ||
Property and equipment, net | 101,467 | 98,251 | ||
Operating lease right-of-use assets, net | 144,630 | |||
Deferred financing costs, net | 3,347 | 3,000 | ||
Investment in guarantor subsidiaries | 235,830 | 246,309 | ||
Intangible assets, net | 34,729 | 28,380 | ||
Goodwill | 112,964 | 76,317 | ||
Total assets | 1,976,612 | 1,723,473 | ||
Liabilities and Stockholders’ Equity: | ||||
Amounts due on senior secured credit facility | 265,647 | 170,761 | ||
Accounts payable | 105,984 | 95,866 | ||
Manufacturer flooring plans payable | 26,350 | 23,178 | ||
Accrued expenses payable and other liabilities | 64,947 | 76,798 | ||
Dividends payable | 147 | 185 | ||
Senior unsecured notes, net | 944,977 | 944,780 | ||
Operating lease right-of-use liabilities | 146,455 | |||
Deferred income taxes | 158,090 | 153,113 | ||
Deferred compensation payable | 2,016 | 1,989 | ||
Total liabilities | 1,714,613 | 1,466,670 | ||
Stockholders’ equity | 261,999 | 256,803 | ||
Total liabilities and stockholders’ equity | 1,976,612 | 1,723,473 | ||
Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | ||||
Assets: | ||||
Receivables, net | 26,232 | 35,163 | ||
Inventories, net | 14,045 | 10,115 | ||
Prepaid expenses and other assets | 134 | 126 | ||
Rental equipment, net | 155,431 | 158,217 | ||
Property and equipment, net | 17,292 | 16,870 | ||
Operating lease right-of-use assets, net | 21,663 | |||
Finance lease right-of-use assets, net | 487 | |||
Goodwill | 29,526 | 29,526 | ||
Total assets | 264,810 | 250,017 | ||
Liabilities and Stockholders’ Equity: | ||||
Accounts payable | 9,510 | 5,974 | ||
Manufacturer flooring plans payable | 488 | |||
Accrued expenses payable and other liabilities | (3,325) | (3,427) | ||
Dividends payable | (54) | (53) | ||
Capital leases payable | 726 | |||
Operating lease right-of-use liabilities | 22,124 | |||
Finance lease right-of-use liabilities | 725 | |||
Total liabilities | 28,980 | 3,708 | ||
Stockholders’ equity | 235,830 | 246,309 | ||
Total liabilities and stockholders’ equity | 264,810 | 250,017 | ||
Elimination [Member] | ||||
Assets: | ||||
Investment in guarantor subsidiaries | (235,830) | (246,309) | ||
Total assets | (235,830) | (246,309) | ||
Liabilities and Stockholders’ Equity: | ||||
Stockholders’ equity | (235,830) | (246,309) | ||
Total liabilities and stockholders’ equity | $ (235,830) | $ (246,309) |
Condensed Consolidating Finan_4
Condensed Consolidating Financial Information of Guarantor Subsidiaries - Condensed Consolidating Statement of Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues: | |||
Revenues | $ 313,638 | $ 260,482 | $ 226,828 |
Cost of revenues: | |||
Cost of revenues | 199,938 | 167,897 | |
Gross profit (loss): | |||
Gross profit | 113,700 | 92,585 | |
Selling, general and administrative expenses | 78,647 | 65,880 | |
Merger costs | 119 | 152 | |
Gain on sales of property and equipment, net | 741 | 773 | |
Income from operations | 35,675 | 27,326 | |
Other income (expense): | |||
Interest expense | (16,855) | (14,653) | |
Other, net | 532 | 395 | |
Total other expense, net | (16,323) | (14,258) | |
Income before provision for income taxes | 19,352 | 13,068 | $ 8,530 |
Income tax expense | 5,109 | 3,590 | |
Net income | 14,243 | 9,478 | |
Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Revenues: | |||
Revenues | 272,433 | 222,032 | |
Cost of revenues: | |||
Cost of revenues | 173,732 | 142,968 | |
Gross profit (loss): | |||
Gross profit | 98,701 | 79,064 | |
Selling, general and administrative expenses | 68,556 | 55,009 | |
Merger costs | 119 | 152 | |
Equity in earnings of guarantor subsidiaries | 1,724 | 458 | |
Gain on sales of property and equipment, net | 707 | 714 | |
Income from operations | 32,457 | 25,075 | |
Other income (expense): | |||
Interest expense | (13,562) | (12,349) | |
Other, net | 457 | 342 | |
Total other expense, net | (13,105) | (12,007) | |
Income before provision for income taxes | 19,352 | 13,068 | |
Income tax expense | 5,109 | 3,590 | |
Net income | 14,243 | 9,478 | |
Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Revenues: | |||
Revenues | 41,205 | 38,450 | |
Cost of revenues: | |||
Cost of revenues | 26,206 | 24,929 | |
Gross profit (loss): | |||
Gross profit | 14,999 | 13,521 | |
Selling, general and administrative expenses | 10,091 | 10,871 | |
Gain on sales of property and equipment, net | 34 | 59 | |
Income from operations | 4,942 | 2,709 | |
Other income (expense): | |||
Interest expense | (3,293) | (2,304) | |
Other, net | 75 | 53 | |
Total other expense, net | (3,218) | (2,251) | |
Income before provision for income taxes | 1,724 | 458 | |
Net income | 1,724 | 458 | |
Elimination [Member] | |||
Gross profit (loss): | |||
Equity in earnings of guarantor subsidiaries | (1,724) | (458) | |
Income from operations | (1,724) | (458) | |
Other income (expense): | |||
Income before provision for income taxes | (1,724) | (458) | |
Net income | (1,724) | (458) | |
Equipment Rentals [Member] | |||
Revenues: | |||
Revenues | 176,129 | 137,038 | |
Cost of revenues: | |||
Cost of revenues | 98,191 | 79,841 | |
Gross profit (loss): | |||
Gross profit | 77,938 | 57,197 | |
Equipment Rentals [Member] | Rentals Other [Member] | |||
Cost of revenues: | |||
Cost of revenues | 16,275 | 12,100 | |
Equipment Rentals [Member] | Rental Depreciation [Member] | |||
Cost of revenues: | |||
Cost of revenues | 57,148 | 46,469 | |
Equipment Rentals [Member] | Rental Expense [Member] | |||
Cost of revenues: | |||
Cost of revenues | 24,768 | 21,272 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Revenues: | |||
Revenues | 153,533 | 117,184 | |
Cost of revenues: | |||
Cost of revenues | 84,478 | 67,709 | |
Gross profit (loss): | |||
Gross profit | 69,055 | 49,475 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | Rentals Other [Member] | |||
Cost of revenues: | |||
Cost of revenues | 14,063 | 9,889 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Revenues: | |||
Revenues | 22,596 | 19,854 | |
Cost of revenues: | |||
Cost of revenues | 13,713 | 12,132 | |
Gross profit (loss): | |||
Gross profit | 8,883 | 7,722 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | Rentals Other [Member] | |||
Cost of revenues: | |||
Cost of revenues | 2,212 | 2,211 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Depreciation [Member] | H & E Equipment Services [Member] | |||
Cost of revenues: | |||
Cost of revenues | 49,263 | 39,559 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Depreciation [Member] | Guarantor Subsidiaries [Member] | |||
Cost of revenues: | |||
Cost of revenues | 7,885 | 6,910 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Expense [Member] | H & E Equipment Services [Member] | |||
Cost of revenues: | |||
Cost of revenues | 21,152 | 18,261 | |
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Expense [Member] | Guarantor Subsidiaries [Member] | |||
Cost of revenues: | |||
Cost of revenues | 3,616 | 3,011 | |
New Equipment Sales [Member] | |||
Revenues: | |||
Revenues | 59,103 | 46,493 | |
Cost of revenues: | |||
Cost of revenues | 52,099 | 40,845 | |
Gross profit (loss): | |||
Gross profit | 7,004 | 5,648 | |
New Equipment Sales [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Revenues: | |||
Revenues | 52,575 | 39,901 | |
Cost of revenues: | |||
Cost of revenues | 46,460 | 35,083 | |
Gross profit (loss): | |||
Gross profit | 6,115 | 4,818 | |
New Equipment Sales [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Revenues: | |||
Revenues | 6,528 | 6,592 | |
Cost of revenues: | |||
Cost of revenues | 5,639 | 5,762 | |
Gross profit (loss): | |||
Gross profit | 889 | 830 | |
Used Equipment Sales [Member] | |||
Revenues: | |||
Revenues | 29,634 | 24,853 | |
Cost of revenues: | |||
Cost of revenues | 19,012 | 16,937 | |
Gross profit (loss): | |||
Gross profit | 10,622 | 7,916 | |
Used Equipment Sales [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Revenues: | |||
Revenues | 25,212 | 20,226 | |
Cost of revenues: | |||
Cost of revenues | 16,211 | 13,832 | |
Gross profit (loss): | |||
Gross profit | 9,001 | 6,394 | |
Used Equipment Sales [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Revenues: | |||
Revenues | 4,422 | 4,627 | |
Cost of revenues: | |||
Cost of revenues | 2,801 | 3,105 | |
Gross profit (loss): | |||
Gross profit | 1,621 | 1,522 | |
Parts Sales [Member] | |||
Revenues: | |||
Revenues | 30,428 | 28,151 | |
Cost of revenues: | |||
Cost of revenues | 22,289 | 20,617 | |
Gross profit (loss): | |||
Gross profit | 8,139 | 7,534 | |
Parts Sales [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Revenues: | |||
Revenues | 26,554 | 24,347 | |
Cost of revenues: | |||
Cost of revenues | 19,591 | 17,956 | |
Gross profit (loss): | |||
Gross profit | 6,963 | 6,391 | |
Parts Sales [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Revenues: | |||
Revenues | 3,874 | 3,804 | |
Cost of revenues: | |||
Cost of revenues | 2,698 | 2,661 | |
Gross profit (loss): | |||
Gross profit | 1,176 | 1,143 | |
Services Revenues [Member] | |||
Revenues: | |||
Revenues | 15,568 | 15,036 | |
Cost of revenues: | |||
Cost of revenues | 5,004 | 5,050 | |
Gross profit (loss): | |||
Gross profit | 10,564 | 9,986 | |
Services Revenues [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Revenues: | |||
Revenues | 13,166 | 12,782 | |
Cost of revenues: | |||
Cost of revenues | 4,282 | 4,361 | |
Gross profit (loss): | |||
Gross profit | 8,884 | 8,421 | |
Services Revenues [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Revenues: | |||
Revenues | 2,402 | 2,254 | |
Cost of revenues: | |||
Cost of revenues | 722 | 689 | |
Gross profit (loss): | |||
Gross profit | 1,680 | 1,565 | |
Other [Member] | |||
Revenues: | |||
Revenues | 2,776 | 8,911 | |
Cost of revenues: | |||
Cost of revenues | 3,343 | 4,607 | |
Gross profit (loss): | |||
Gross profit | (567) | 4,304 | |
Other [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Revenues: | |||
Revenues | 1,393 | 7,592 | |
Cost of revenues: | |||
Cost of revenues | 2,710 | 4,027 | |
Gross profit (loss): | |||
Gross profit | (1,317) | 3,565 | |
Other [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Revenues: | |||
Revenues | 1,383 | 1,319 | |
Cost of revenues: | |||
Cost of revenues | 633 | 580 | |
Gross profit (loss): | |||
Gross profit | $ 750 | $ 739 |
Condensed Consolidating Finan_5
Condensed Consolidating Financial Information of Guarantor Subsidiaries - Condensed Consolidating Statement of Cash Flows (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net income | $ 14,243 | $ 9,478 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization on property and equipment | 6,479 | 5,884 | |
Depreciation of rental equipment | 57,148 | 46,469 | |
Amortization of finance lease right-of-use assets | 41 | ||
Amortization of intangible assets | 952 | 705 | |
Amortization of deferred financing costs | 254 | 289 | |
Accretion of note discount, net of premium amortization | 120 | 120 | |
Operating lease right-of-use liabilities, net | 146 | ||
Provision for losses on accounts receivable | 1,301 | 817 | |
Provision for inventory obsolescence | 42 | 67 | |
Change in deferred income taxes | 4,977 | 4,456 | |
Stock-based compensation expense | 1,188 | 1,319 | |
Gain from sales of property and equipment, net | (741) | (773) | |
Gain from sales of rental equipment, net | (10,621) | (7,745) | |
Changes in operating assets and liabilities, net of acquisitions: | |||
Receivables | 17,605 | 22,414 | |
Inventories | (58,062) | (88,674) | |
Prepaid expenses and other assets | (2,117) | (2,237) | |
Accounts payable | 13,539 | 45,384 | |
Manufacturer flooring plans payable | 2,684 | 6,110 | |
Accrued expenses payable and other liabilities | (10,137) | (15,799) | |
Deferred compensation payable | 27 | 22 | |
Net cash provided by operating activities | 39,068 | 28,306 | |
Cash flows from investing activities: | |||
Acquisition of business, net of cash acquired | (106,746) | (125,207) | |
Purchases of property and equipment | (7,221) | (4,505) | |
Purchases of rental equipment | (48,644) | (40,654) | |
Proceeds from sales of property and equipment | 931 | 785 | |
Proceeds from sales of rental equipment | 28,292 | 23,430 | |
Net cash used in investing activities | (133,388) | (146,151) | |
Cash flows from financing activities: | |||
Borrowings on senior secured credit facility | 447,503 | 294,229 | |
Payments on senior secured credit facility | (352,617) | (294,229) | |
Dividends paid | (9,832) | (9,804) | |
Purchases of treasury stock | (387) | ||
Payment of deferred financing costs | (525) | (88) | |
Payments on finance lease obligations | (57) | ||
Payments on capital lease obligations | (57) | ||
Net cash provided by (used in) financing activities | 84,085 | (9,949) | |
Net decrease in cash | (10,235) | (127,794) | |
Cash, beginning of period | 16,677 | 165,878 | $ 165,878 |
Cash, end of period | 6,442 | 38,084 | 16,677 |
Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||
Cash flows from operating activities: | |||
Net income | 14,243 | 9,478 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization on property and equipment | 5,692 | 5,163 | |
Depreciation of rental equipment | 49,263 | 39,559 | |
Amortization of intangible assets | 952 | 705 | |
Amortization of deferred financing costs | 254 | 289 | |
Accretion of note discount, net of premium amortization | 120 | 120 | |
Operating lease right-of-use liabilities, net | 113 | ||
Provision for losses on accounts receivable | 1,112 | 593 | |
Provision for inventory obsolescence | 42 | 67 | |
Change in deferred income taxes | 4,977 | 4,456 | |
Stock-based compensation expense | 1,188 | 1,319 | |
Gain from sales of property and equipment, net | (707) | (714) | |
Gain from sales of rental equipment, net | (9,004) | (6,228) | |
Equity in earnings of guarantor subsidiaries | (1,724) | (458) | |
Changes in operating assets and liabilities, net of acquisitions: | |||
Receivables | 8,863 | 11,687 | |
Inventories | (51,703) | (78,456) | |
Prepaid expenses and other assets | (2,109) | (2,175) | |
Accounts payable | 10,003 | 45,770 | |
Manufacturer flooring plans payable | 3,172 | 7,143 | |
Accrued expenses payable and other liabilities | (10,667) | (15,286) | |
Deferred compensation payable | 27 | 22 | |
Net cash provided by operating activities | 24,107 | 23,054 | |
Cash flows from investing activities: | |||
Acquisition of business, net of cash acquired | (106,746) | (125,207) | |
Purchases of property and equipment | (5,446) | (4,301) | |
Purchases of rental equipment | (43,311) | (36,688) | |
Proceeds from sales of property and equipment | 859 | 726 | |
Proceeds from sales of rental equipment | 24,012 | 18,901 | |
Investment in subsidiaries | 12,203 | 5,613 | |
Net cash used in investing activities | (118,429) | (140,956) | |
Cash flows from financing activities: | |||
Borrowings on senior secured credit facility | 447,503 | 294,229 | |
Payments on senior secured credit facility | (352,617) | (294,229) | |
Dividends paid | (9,831) | (9,804) | |
Purchases of treasury stock | (387) | ||
Payment of deferred financing costs | (525) | (88) | |
Payments on finance lease obligations | (56) | ||
Net cash provided by (used in) financing activities | 84,087 | (9,892) | |
Net decrease in cash | (10,235) | (127,794) | |
Cash, beginning of period | 16,677 | 165,878 | 165,878 |
Cash, end of period | 6,442 | 38,084 | $ 16,677 |
Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||
Cash flows from operating activities: | |||
Net income | 1,724 | 458 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization on property and equipment | 787 | 721 | |
Depreciation of rental equipment | 7,885 | 6,910 | |
Amortization of finance lease right-of-use assets | 41 | ||
Operating lease right-of-use liabilities, net | 33 | ||
Provision for losses on accounts receivable | 189 | 224 | |
Gain from sales of property and equipment, net | (34) | (59) | |
Gain from sales of rental equipment, net | (1,617) | (1,517) | |
Changes in operating assets and liabilities, net of acquisitions: | |||
Receivables | 8,742 | 10,727 | |
Inventories | (6,359) | (10,218) | |
Prepaid expenses and other assets | (8) | (62) | |
Accounts payable | 3,536 | (386) | |
Manufacturer flooring plans payable | (488) | (1,033) | |
Accrued expenses payable and other liabilities | 530 | (513) | |
Net cash provided by operating activities | 14,961 | 5,252 | |
Cash flows from investing activities: | |||
Purchases of property and equipment | (1,775) | (204) | |
Purchases of rental equipment | (5,333) | (3,966) | |
Proceeds from sales of property and equipment | 72 | 59 | |
Proceeds from sales of rental equipment | 4,280 | 4,529 | |
Net cash used in investing activities | (2,756) | 418 | |
Cash flows from financing activities: | |||
Dividends paid | (1) | ||
Payments on finance lease obligations | (1) | ||
Payments on capital lease obligations | (57) | ||
Capital contributions | (12,203) | (5,613) | |
Net cash provided by (used in) financing activities | (12,205) | (5,670) | |
Elimination [Member] | |||
Cash flows from operating activities: | |||
Net income | (1,724) | (458) | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Equity in earnings of guarantor subsidiaries | 1,724 | 458 | |
Cash flows from investing activities: | |||
Investment in subsidiaries | (12,203) | (5,613) | |
Net cash used in investing activities | (12,203) | (5,613) | |
Cash flows from financing activities: | |||
Capital contributions | 12,203 | 5,613 | |
Net cash provided by (used in) financing activities | $ 12,203 | $ 5,613 |