Worldwide car and equipment rental company Hertz Global Holdings, Inc. (NYSE: HTZ) posted record 3Q revenues and named Elyse Douglas as its new CFO. Not bad for a day's work. Unfortunately, such good news does not seem to have helped the stock, which dropped almost 7% of its value today, closing at $21.40, down $1.58. Despite the good 3Q numbers, continued weak demand for rental equipment in the transportation and construction industries means Hertz will have to try harder simply not to fall behind.
For 3Q 2007, worldwide revenue was up 9.3% to $2.45 billion. Revenue from worldwide car rentals increased 11%, due partly to an increase in the number of transaction days, as well as the average rental price per day. Airport rental rates increased around 5%, while off airport rental revenues shot up over 13%.
On the one hand, Hertz is growing its revenue stream, but on the other, it still carries a mountain of debt, $4.5 billion at the end of 3Q 2007. Hertz managed to reduce the debt load by a paltry $354 million during the quarter. Perhaps the new CFO Elyse Douglas can get the company's debt load under control so that more top line growth translates into bottom line growth.
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