SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 26, 1998
THE HERTZ CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-7541 13-1938568
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
225 Brae Boulevard, Park Ridge, New Jersey 07656-0713
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (201) 307-2000
Not Applicable
(Former name or former address, if changed since last report)
Page 1 of 7 pages.
The Exhibit Index is on page 3 .
Item 5. Other Events.
On January 26, 1998, The Hertz Corporation issued a press
release with respect to its fourth quarter and full year 1997
earnings.
A copy of such press release is attached as Exhibit 99 hereto
and incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
(c) EXHIBITS.
The following Exhibit is filed as part of this Report.
(99) Press release relating to The Hertz Corporation's
fourth quarter and full year 1997 earnings.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
THE HERTZ CORPORATION
(Registrant)
By: /s/ Richard J. Foti
Richard J. Foti
Staff Vice President
and Controller
(Principal Accounting Officer)
Dated: January 28, 1998
Exhibit Index
Exhibit No. Description Page
(99) Press release relating to The 4 - 7
Hertz Corporation's fourth
quarter and full year 1997
earnings.
FOR IMMEDIATE RELEASE CONTACT: Financial - Lauren S. Babus
201-307-2100
Press - Joe Russo
201-307-2486
HERTZ REPORTS ANOTHER RECORD YEAR WITH 97 EARNINGS UP 27%
PARK RIDGE, NJ, January 26, 1998 - The Hertz Corporation (NYSE: HRZ), the
world's largest car rental company and the largest industrial and construction
equipment rental business in the U.S., reported record earnings for 1997 of
$201.6 million or $1.86 per share, up 27% from 1996 earnings of $158.6 million
or $1.46 per share on a diluted basis. Excluding a one-time favorable tax
adjustment of $13.9 million in 1996, the earnings increase would have been
39%.
For Hertz, this is the sixth consecutive year of record revenue and the fourth
consecutive year of record after tax earnings.
For the fourth quarter 1997, net earnings were $34.6 million, or 32 cents per
share on a diluted basis. As a consequence of the prior year's tax adjustment,
1997 earnings were slightly lower than 1996 earnings of $36.1 million or 33
cents per share. Excluding this one-time benefit, Hertz would have had a
record fourth quarter with net income increasing by 56%. The increase for
HERTZ FOURTH QUARTER EARNINGS - 2
the fourth quarter reflected the continuing upward pricing movement in the U.S.
car rental market.
Hertz achieved record revenues in 1997 of $3.9 billion, up 6.1% from 1996.
Before the impact of changes in foreign exchange rates, the revenue increase
would have been approximately $300 million, or 8% growth over the prior year.
In 1997, domestic car rental operations reported record revenue of $2.5
billion, up almost 10% over the prior year.
International car rental and leasing generated revenue of $890 million in 1997,
a 5% decline versus 1996. Before the impact of changes in foreign exchange
rates, and adjusted for the franchising of Denmark and Norway, which had been
corporately owned, revenue would have been approximately 5% higher than in
1996.
Hertz' industrial and construction equipment rental operations produced
record revenue of $444.6 million for 1997, a 13.3% increase over 1996. The
increase was due to the opening of 20 new locations in the United States,
increased volume at existing locations, and continued expansion into the
industrial equipment rental market.
HERTZ FOURTH QUARTER EARNINGS - 3
In the fourth quarter 1997, domestic rental car revenue was $600 million, up 9%
from fourth quarter 1996. Fourth quarter revenue from international car rental
and leasing operations was $202 million, a decline of 10% compared with the
same period the prior year. Before the impact of changes in foreign exchange
rates, and adjusted for the franchising of previously owned locations,
international revenue would have increased by more than 3%. Industrial and
construction equipment rental operations produced fourth quarter revenue of
$126.4 million, an increase of nearly 12% over fourth quarter 1996.
"We are gratified at our sustained record performance and believe this trend
will continue, supported by enhancements in our operations and innovations in
customer service," said Frank A. Olson, Hertz Chairman and Chief Executive
Officer.
The Hertz Corporation, headquartered in Park Ridge, New Jersey, operates
approximately 5,500 rental locations throughout the U.S. and in approximately
140 foreign countries and approximately 150 equipment rental locations in the
U.S. and Europe.
THE HERTZ CORPORATION
CONDENSED STATEMENT OF INCOME
(In Thousands of Dollars)
Unaudited
Three Months As % of
Ended Dec. 31, Total Revenue
1997 1996 1997 1996
Revenue $ 934,510 $ 893,812 100.0% 100.0%
Expenses:
Direct Operating 450,472 448,156 48.2% 50.1%
Depreciation of revenue
earning equipment 248,821 232,746 26.6% 26.0%
Selling, General and
Administrative 110,871 104,231 11.9% 11.7%
Interest - net 69,788 74,815 7.5% 8.4%
Total expenses 879,952 859,948 94.2% 96.2%
Income before income taxes 54,558 33,864 5.8% 3.8%
Income taxes 19,994 (2,214) 2.1% -0.2%
Net income $ 34,564 $ 36,078 3.7% 4.0%
Net income per share
Basic $0.32 $0.33
Diluted $0.32 $0.33
Twelve Months As % of
Ended Dec. 31, Total Revenue
1997 1996 1997 1996
Revenue $3,891,320 $3,668,383 100.0% 100.0%
Expenses:
Direct Operating 1,826,720 1,795,157 46.9% 48.9%
Depreciation of revenue
earning equipment 979,560 892,678 25.2% 24.3%
Selling, General and
Administrative 439,558 425,179 11.3% 11.6%
Interest - net 302,212 298,800 7.8% 8.1%
Total expenses 3,548,050 3,411,814 91.2% 93.0%
Income before income taxes 343,270 256,569 8.8% 7.0%
Income taxes 141,652 97,950 3.6% 2.7%
Net income $ 201,61 $ 158,619 5.2% 4.3%
Net income per share
Basic $1.86 $1.47
Diluted $1.86 $1.46