☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||
For the fiscal year ended | December 31, | |||||||
OR | ||||||||
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Principal Executive Office Address and Telephone Number | State of Incorporation | I.R.S. Employer Identification No. | ||||||||||||||||||||||||||||||||
001-37665 | HERTZ GLOBAL HOLDINGS, INC | Delaware | 61-1770902 | |||||||||||||||||||||||||||||||
8501 Williams Road, | Estero, | Florida | 33928 | |||||||||||||||||||||||||||||||
001-07541 | THE HERTZ CORPORATION | Delaware | 13-1938568 | |||||||||||||||||||||||||||||
8501 Williams Road, | Estero, | Florida | 33928 | |||||||||||||||||||||||||||||
(239) | 301-7000 |
Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||||||||||||||||||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||||||||||||||||||||
Hertz Global Holdings, Inc. | Common | HTZ | ||||||||||||||||||||||||||||||
Hertz Global Holdings, Inc. | Warrants to purchase common stock | Each exercisable for one share of Hertz Global Holdings, Inc. common stock at an exercise price of $13.80 per share, subject to adjustment | HTZWW | Nasdaq Global Select* | ||||||||||||||||||||||||||||
The Hertz Corporation | None | None | None | |||||||||||||||||||||||||||||
* Hertz Global Holdings, Inc.'s common stock and Public Warrants began trading exclusively on the Nasdaq Global Select Market on November 9, 2021 under the trading symbols "HTZ" and "HTZWW," respectively. | ||||||||||||||||||||||||||||||||
Securities registered pursuant to Section 12(g) of the Act: | ||||||||||||||||||||||||||||||||
Hertz Global Holdings, Inc. | None | |||||||||||||||||||||||||||||||
The Hertz Corporation | None |
Hertz Global Holdings, Inc. | Large accelerated filer | x | Accelerated filer | o | Non-accelerated filer | o | ||||||||||||||
Smaller reporting company | ☐ | Emerging growth company | ☐ | |||||||||||||||||
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | o | |||||||||||||||||||
The Hertz Corporation | Large accelerated filer | o | Accelerated filer | o | Non-accelerated filer | x | ||||||||||||||
Smaller reporting company | ☐ | Emerging growth company | ☐ | |||||||||||||||||
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | o |
Class | Shares Outstanding as of | February 17, 2022 | ||||||||||||||||||
Hertz Global Holdings, Inc. | Common Stock, par value $0.01 per share | 429,294,302 | ||||||||||||||||||
The Hertz Corporation | (1) | Common Stock, par value $0.01 per share | 100 | |||||||||||||||||
(1)(100% owned by Rental Car Intermediate Holdings, LLC) |
Hertz Global Holdings, Inc. | Information required by Items 10, 11, 12 and 13 of Part III of this Form 10-K is incorporated by reference to Hertz Global Holdings, Inc.'s definitive proxy statement for its | |||||||
The Hertz Corporation | None |
Page | ||||||||
(iii)"All other operations" means our former All Other Operations reportable segment which was no longer deemed a reportable segment in the second quarter of 2021 resulting from the sale of our Donlen subsidiary on March 30, 2021; (iv)"Alternative Letter of Credit Facility" means the standalone $250 million letter of credit facility that Hertz entered into in 2019 as further described in Note 6, "Debt," to the Notes to our consolidated financial statements |
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Name | Age | Number of Years Employed | Position | |||
Kathryn V. Marinello | 63 | 3 | President and Chief Executive Officer | |||
Jamere Jackson | 50 | 1 | Executive Vice President and Chief Financial Officer | |||
Murali Kuppuswamy | 58 | 2 | Executive Vice President and Chief Human Resources Officer | |||
Jodi J. Allen | 54 | 2 | Executive Vice President and Chief Marketing Officer | |||
M. David Galainena | 62 | — | Executive Vice President, General Counsel and Secretary | |||
Opal G. Perry | 48 | 1 | Executive Vice President and Chief Information Officer | |||
Paul E. Stone | 49 | 1 | Executive Vice President and Chief Retail Operations Officer North America | |||
Angela I. Brav | 58 | — | President - Hertz International | |||
R. Eric Esper | 39 | 1 | Senior Vice President and Chief Accounting Officer |
Name | Age | Number of Years Employed | Position | |||||||||||||||||
Mark Fields | 61 | — | Interim Chief Executive Officer | |||||||||||||||||
Paul E. Stone | 51 | 3 | President and Chief Operating Officer | |||||||||||||||||
Kenny K. Cheung | 40 | 3 | Executive Vice President and Chief Financial Officer | |||||||||||||||||
Darren R. Arrington | 45 | 10 | Executive Vice President, Revenue Management and Fleet Operations | |||||||||||||||||
M. David Galainena | 64 | 2 | Executive Vice President, General Counsel and Secretary | |||||||||||||||||
Joseph E. McPherson | 55 | 35 | Executive Vice President, North America Operations | |||||||||||||||||
Timothy M. Langley-Hawthorne | 53 | — | Executive Vice President and Chief Information Officer | |||||||||||||||||
Laura C. Smith | 44 | 19 | Executive Vice President, Sales, Marketing and Customer Experience | |||||||||||||||||
Eric J. Leef | 48 | 1 | Executive Vice President and Chief Human Resources Officer | |||||||||||||||||
Angela I. Brav | 59 | 2 | President - Hertz International | |||||||||||||||||
Alexandra D. Brooks | 51 | 1 | Senior Vice President and Chief Accounting Officer |
(a) Total number of shares purchased | (b) Average price paid per share | (c) Total number of shares purchased as part of the publicly announced plan or program | (d) Maximum number (or approximate dollar value) of shares that may yet be purchased under the publicly announced plan or program (In thousands, except share data) | ||||||||||||||||||||
Common Stock | |||||||||||||||||||||||
October 1 – October 31, 2021 | 0 | $ | — | 0 | $ | 2,000,000 | |||||||||||||||||
November 1 – November 30, 2021 | 11,528,793 | $ | 28.51 | 1,183,965 | $ | 1,971,339 | |||||||||||||||||
December 1 – December 31, 2021 | 15,922,061 | $ | 23.80 | 15,922,061 | $ | 1,592,384 | |||||||||||||||||
Total | 27,450,854 | $ | 25.78 | 17,106,026 | $ | 1,592,384 | |||||||||||||||||
Series A Preferred Stock | |||||||||||||||||||||||
October 1 – October 31, 2021 | 0 | $ | — | 0 | 1,500,000 | ||||||||||||||||||
November 1 – November 30, 2021 | 0 | $ | — | 0 | 1,500,000 | ||||||||||||||||||
December 1 – December 31, 2021 | 1,500,000 | $ | 1,250.00 | 1,500,000 | 0 | ||||||||||||||||||
Total | 1,500,000 | $ | 1,250.00 | 1,500,000 | 0 |
(In millions, except per share data) | Years Ended December 31, | ||||||||||||||||||
Statements of Operations Data | 2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||
Revenues: | |||||||||||||||||||
Worldwide vehicle rental(a) | $ | 9,107 | $ | 8,756 | $ | 8,163 | $ | 8,211 | $ | 8,434 | |||||||||
All other operations | 672 | 748 | 640 | 592 | 583 | ||||||||||||||
Total revenues | 9,779 | 9,504 | 8,803 | 8,803 | 9,017 | ||||||||||||||
Expenses: | |||||||||||||||||||
Direct vehicle and operating | 5,486 | 5,355 | 4,958 | 4,932 | 5,055 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 2,565 | 2,690 | 2,798 | 2,601 | 2,433 | ||||||||||||||
Selling, general and administrative | 969 | 1,017 | 880 | 899 | 873 | ||||||||||||||
Interest expense, net: | |||||||||||||||||||
Vehicle | 494 | 448 | 331 | 280 | 253 | ||||||||||||||
Non-vehicle | 311 | 291 | 306 | 344 | 346 | ||||||||||||||
Total interest expense, net | 805 | 739 | 637 | 624 | 599 | ||||||||||||||
Goodwill and intangible asset impairments | — | — | 86 | 292 | 40 | ||||||||||||||
Other (income) expense, net | (59 | ) | (40 | ) | 19 | (75 | ) | (115 | ) | ||||||||||
Total expenses | 9,766 | 9,761 | 9,378 | 9,273 | 8,885 | ||||||||||||||
Income (loss) from continuing operations before income taxes | 13 | (257 | ) | (575 | ) | (470 | ) | 132 | |||||||||||
Income tax (provision) benefit(b) | (63 | ) | 30 | 902 | (4 | ) | (17 | ) | |||||||||||
Net income (loss) from continuing operations | (50 | ) | (227 | ) | 327 | (474 | ) | 115 | |||||||||||
Net income (loss) from discontinued operations | — | — | — | (17 | ) | 158 | |||||||||||||
Net income (loss) | (50 | ) | (227 | ) | 327 | (491 | ) | 273 | |||||||||||
Net (income) loss attributable to noncontrolling interests | (8 | ) | 2 | — | — | — | |||||||||||||
Net income (loss) attributable to Hertz Global | $ | (58 | ) | $ | (225 | ) | $ | 327 | $ | (491 | ) | $ | 273 | ||||||
Weighted-average shares outstanding:(c) | |||||||||||||||||||
Basic | 117 | 96 | 95 | 96 | 103 | ||||||||||||||
Diluted | 117 | 96 | 95 | 96 | 104 | ||||||||||||||
Earnings (loss) per share: | |||||||||||||||||||
Basic earnings (loss) per share | $ | (0.49 | ) | $ | (2.35 | ) | $ | 3.44 | $ | (5.11 | ) | $ | 2.64 | ||||||
Diluted earnings (loss) per share | $ | (0.49 | ) | $ | (2.35 | ) | $ | 3.44 | $ | (5.11 | ) | $ | 2.62 |
(In millions) | As of December 31, | ||||||||||||||||||
Balance Sheet Data | 2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||
Cash and cash equivalents | $ | 865 | $ | 1,127 | $ | 1,072 | $ | 816 | $ | 474 | |||||||||
Revenue earning vehicles, net | 13,789 | 12,419 | 11,336 | 10,818 | 10,746 | ||||||||||||||
Total assets(d) | 24,627 | 21,382 | 20,058 | 19,155 | 23,514 | ||||||||||||||
Total debt | 17,089 | 16,324 | 14,865 | 13,541 | 15,770 | ||||||||||||||
Total equity attributable to Hertz Global(e) | 1,769 | 1,061 | 1,520 | 1,075 | 2,019 |
(In millions) | Years Ended December 31, | ||||||||||||||||||
Statements of Operations Data | 2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||
Revenues: | |||||||||||||||||||
Worldwide vehicle rental(a) | $ | 9,107 | $ | 8,756 | $ | 8,163 | $ | 8,211 | $ | 8,434 | |||||||||
All other operations | 672 | 748 | 640 | 592 | 583 | ||||||||||||||
Total revenues | 9,779 | 9,504 | 8,803 | 8,803 | 9,017 | ||||||||||||||
Expenses: | |||||||||||||||||||
Direct vehicle and operating | 5,486 | 5,355 | 4,958 | 4,932 | 5,055 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 2,565 | 2,690 | 2,798 | 2,601 | 2,433 | ||||||||||||||
Selling, general and administrative | 969 | 1,017 | 880 | 899 | 873 | ||||||||||||||
Interest expense, net: | |||||||||||||||||||
Vehicle | 494 | 448 | 331 | 280 | 253 | ||||||||||||||
Non-vehicle | 304 | 284 | 301 | 343 | 346 | ||||||||||||||
Total interest expense, net | 798 | 732 | 632 | 623 | 599 | ||||||||||||||
Goodwill and intangible asset impairments | — | — | 86 | 292 | 40 | ||||||||||||||
Other (income) expense, net | (59 | ) | (40 | ) | 19 | (75 | ) | (115 | ) | ||||||||||
Total expenses | 9,759 | 9,754 | 9,373 | 9,272 | 8,885 | ||||||||||||||
Income (loss) from continuing operations before income taxes | 20 | (250 | ) | (570 | ) | (469 | ) | 132 | |||||||||||
Income tax (provision) benefit(b) | (65 | ) | 28 | 902 | (4 | ) | (17 | ) | |||||||||||
Net income (loss) from continuing operations | (45 | ) | (222 | ) | 332 | (473 | ) | 115 | |||||||||||
Net income (loss) from discontinued operations | — | — | — | (15 | ) | 161 | |||||||||||||
Net income (loss) | (45 | ) | (222 | ) | 332 | (488 | ) | 276 | |||||||||||
Net (income) loss attributable to noncontrolling interests | (8 | ) | 2 | — | — | — | |||||||||||||
Net income (loss) attributable to Hertz | $ | (53 | ) | $ | (220 | ) | $ | 332 | $ | (488 | ) | $ | 276 |
(In millions) | As of December 31, | ||||||||||||||||||
Balance Sheet Data | 2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||
Cash and cash equivalents | $ | 865 | $ | 1,127 | $ | 1,072 | $ | 816 | $ | 474 | |||||||||
Revenue earning vehicles, net | 13,789 | 12,419 | 11,336 | 10,818 | 10,746 | ||||||||||||||
Total assets(c) | 24,627 | 21,382 | 20,058 | 19,155 | 23,509 | ||||||||||||||
Total debt | 17,089 | 16,324 | 14,865 | 13,541 | 15,770 | ||||||||||||||
Total equity attributable to Hertz(d) | 1,765 | 1,059 | 1,520 | 1,075 | 1,948 |
(1) Includes impact of foreign currency exchange at average rates ("fx"). (2) Results shown are in constant currency as of December 31, 2020. (3) The percentages shown in this chart reflect Vehicle Utilization versus period-over-period change. |
Years Ended December 31, | Percent Increase/(Decrease) | Years Ended December 31, | Percent Increase/(Decrease) | |||||||||||||||||||||||||||||||||||||||||||
($ In millions) | 2019 | 2018 | 2017 | 2019 vs. 2018 | 2018 vs. 2017 | ($ In millions) | 2021 | 2020 | 2019 | 2021 vs. 2020 | 2020 vs. 2019 | |||||||||||||||||||||||||||||||||||
Total revenues | $ | 9,779 | $ | 9,504 | $ | 8,803 | 3 | % | 8 | % | Total revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 | 40% | (46)% | |||||||||||||||||||||||||||
Direct vehicle and operating expenses | 5,486 | 5,355 | 4,958 | 2 | 8 | Direct vehicle and operating expenses | 3,920 | 3,423 | 5,305 | 15 | (35) | |||||||||||||||||||||||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 2,565 | 2,690 | 2,798 | (5 | ) | (4 | ) | Depreciation of revenue earning vehicles and lease charges | 497 | 2,030 | 2,563 | (76) | (21) | |||||||||||||||||||||||||||||||||
Non-vehicle depreciation and amortization | Non-vehicle depreciation and amortization | 196 | 225 | 203 | (13) | 11 | ||||||||||||||||||||||||||||||||||||||||
Selling, general and administrative expenses | 969 | 1,017 | 880 | (5 | ) | 16 | Selling, general and administrative expenses | 688 | 645 | 949 | 7 | (32) | ||||||||||||||||||||||||||||||||||
Interest expense, net: | Interest expense, net: | |||||||||||||||||||||||||||||||||||||||||||||
Vehicle | 494 | 448 | 331 | 10 | 35 | Vehicle | 284 | 455 | 494 | (38) | (8) | |||||||||||||||||||||||||||||||||||
Non-vehicle | 304 | 284 | 301 | 7 | (6 | ) | Non-vehicle | 185 | 151 | 304 | 23 | (50) | ||||||||||||||||||||||||||||||||||
Interest expense, net | 798 | 732 | 632 | 9 | 16 | |||||||||||||||||||||||||||||||||||||||||
Goodwill and intangible asset impairments | — | — | 86 | — | (100 | ) | ||||||||||||||||||||||||||||||||||||||||
Total Interest expense, net | Total Interest expense, net | 469 | 606 | 798 | (23) | (24) | ||||||||||||||||||||||||||||||||||||||||
Technology-related intangible and other asset impairments | Technology-related intangible and other asset impairments | — | 213 | — | (100) | NM | ||||||||||||||||||||||||||||||||||||||||
Write-off of intercompany loan | Write-off of intercompany loan | — | 133 | — | (100) | NM | ||||||||||||||||||||||||||||||||||||||||
Other (income) expense, net | (59 | ) | (40 | ) | 19 | 48 | NM | Other (income) expense, net | (21) | (9) | (59) | NM | (85) | |||||||||||||||||||||||||||||||||
Reorganization items, net | Reorganization items, net | 513 | 175 | — | NM | NM | ||||||||||||||||||||||||||||||||||||||||
(Gain) from the sale of a business | (Gain) from the sale of a business | (400) | — | — | NM | NM | ||||||||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | 20 | (250 | ) | (570 | ) | NM | (56 | ) | Income (loss) before income taxes | 1,474 | (2,183) | 20 | NM | NM | ||||||||||||||||||||||||||||||||
Income tax (provision) benefit | (65 | ) | 28 | 902 | NM | (97 | ) | Income tax (provision) benefit | (318) | 328 | (65) | NM | NM | |||||||||||||||||||||||||||||||||
Net income (loss) | (45 | ) | (222 | ) | 332 | (80 | ) | NM | Net income (loss) | 1,156 | (1,855) | (45) | NM | NM | ||||||||||||||||||||||||||||||||
Net (income) loss attributable to noncontrolling interests | (8 | ) | 2 | — | NM | NM | Net (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | (90) | NM | ||||||||||||||||||||||||||||||||||
Net income (loss) attributable to Hertz | $ | (53 | ) | $ | (220 | ) | $ | 332 | (76 | ) | NM | Net income (loss) attributable to Hertz | $ | 1,157 | $ | (1,846) | $ | (53) | NM | NM | ||||||||||||||||||||||||||
Adjusted Corporate EBITDA(a) | $ | 649 | $ | 433 | $ | 267 | 50 | 62 | Adjusted Corporate EBITDA(a) | $ | 2,130 | $ | (995) | $ | 649 | NM | NM |
Years Ended December 31, | Percent Increase/(Decrease) | Years Ended December 31, | Percent Increase/(Decrease) | |||||||||||||||||||||||||||||||||||||||||||
($ In millions, except as noted) | 2019 | 2018 | 2017 | 2019 vs. 2018 | 2018 vs. 2017 | ($ In millions, except as noted) | 2021 | 2020 | 2019 | 2021 vs. 2020 | 2020 vs. 2019 | |||||||||||||||||||||||||||||||||||
Total revenues | $ | 6,938 | $ | 6,480 | $ | 5,994 | 7 | % | 8 | % | Total revenues | $ | 6,215 | $ | 3,756 | $ | 7,208 | 65% | (48)% | |||||||||||||||||||||||||||
Depreciation of revenue earning vehicles and lease charges | $ | 1,656 | $ | 1,678 | $ | 1,904 | (1 | ) | (12 | ) | Depreciation of revenue earning vehicles and lease charges | $ | 343 | $ | 1,352 | $ | 1,706 | (75) | (21) | |||||||||||||||||||||||||||
Direct vehicle and operating expenses | $ | 4,146 | $ | 4,014 | $ | 3,651 | 3 | 10 | Direct vehicle and operating expenses | $ | 3,302 | $ | 2,763 | $ | 4,163 | 20 | (34) | |||||||||||||||||||||||||||||
Direct vehicle and operating expenses as a percentage of total revenues | 60 | % | 62 | % | 61 | % | Direct vehicle and operating expenses as a percentage of total revenues | 53 | % | 74 | % | 58 | % | |||||||||||||||||||||||||||||||||
Non-vehicle depreciation and amortization | Non-vehicle depreciation and amortization | $ | 166 | $ | 182 | $ | 159 | (9) | 15 | |||||||||||||||||||||||||||||||||||||
Selling, general and administrative expenses | $ | 490 | $ | 466 | $ | 392 | 5 | 19 | Selling, general and administrative expenses | $ | 282 | $ | 283 | $ | 499 | — | (43) | |||||||||||||||||||||||||||||
Selling, general and administrative expenses as a percentage of total revenues | 7 | % | 7 | % | 7 | % | Selling, general and administrative expenses as a percentage of total revenues | 5 | % | 8 | % | 7 | % | |||||||||||||||||||||||||||||||||
Vehicle interest expense | $ | 345 | $ | 291 | $ | 226 | 19 | 29 | Vehicle interest expense | $ | 213 | $ | 329 | $ | 353 | (35) | (7) | |||||||||||||||||||||||||||||
Reorganization items, net | Reorganization items, net | $ | 80 | $ | 8 | $ | — | NM | NM | |||||||||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | 480 | $ | 226 | $ | 50 | 113 | NM | Adjusted EBITDA | $ | 2,173 | $ | (810) | $ | 512 | NM | NM | |||||||||||||||||||||||||||||
Transaction Days (in thousands)(b) | 155,859 | 149,463 | 140,382 | 4 | 6 | Transaction Days (in thousands)(b) | 100,085 | 85,016 | 161,278 | 18 | (47) | |||||||||||||||||||||||||||||||||||
Average Vehicles (in whole units)(c) | 534,879 | 506,900 | 484,700 | 6 | 5 | Average Vehicles (in whole units)(c) | 355,647 | 437,547 | 555,220 | (19) | (21) | |||||||||||||||||||||||||||||||||||
Vehicle Utilization(c) | 80 | % | 81 | % | 79 | % | Vehicle Utilization(c) | 77 | % | 53 | % | 80 | % | |||||||||||||||||||||||||||||||||
Total RPD (in whole dollars)(d) | $ | 43.73 | $ | 42.67 | $ | 42.06 | 2 | 1 | Total RPD (in whole dollars)(d) | $ | 62.07 | $ | 44.22 | $ | 44.75 | 40 | (1) | |||||||||||||||||||||||||||||
Total RPU Per Month (in whole dollars)(e) | $ | 1,062 | $ | 1,049 | $ | 1,015 | 1 | 3 | Total RPU Per Month (in whole dollars)(e) | $ | 1,456 | $ | 716 | $ | 1,083 | NM | (34) | |||||||||||||||||||||||||||||
Net Depreciation Per Unit Per Month (in whole dollars)(f) | $ | 258 | $ | 276 | $ | 327 | (7 | ) | (16 | ) | ||||||||||||||||||||||||||||||||||||
Depreciation Per Unit Per Month (in whole dollars)(f) | Depreciation Per Unit Per Month (in whole dollars)(f) | $ | 80 | $ | 258 | $ | 256 | (69) | 1 | |||||||||||||||||||||||||||||||||||||
Percentage of program vehicles as of period end | 11 | % | 9 | % | 7 | % | Percentage of program vehicles as of period end | 0.4 | % | 3 | % | 11 | % |
Years Ended December 31, | Percent Increase/(Decrease) | ||||||||||||||||
($ In millions, except as noted) | 2019 | 2018 | 2017 | 2019 vs. 2018 | 2018 vs. 2017 | ||||||||||||
Total revenues | $ | 2,169 | $ | 2,276 | $ | 2,169 | (5 | )% | 5 | % | |||||||
Depreciation of revenue earning vehicles and lease charges | $ | 440 | $ | 448 | $ | 416 | (2 | ) | 8 | ||||||||
Direct vehicle and operating expenses | $ | 1,312 | $ | 1,306 | $ | 1,273 | — | 3 | |||||||||
Direct vehicle and operating expenses as a percentage of total revenues | 61 | % | 57 | % | 59 | % | |||||||||||
Selling, general and administrative expenses | $ | 221 | $ | 248 | $ | 223 | (11 | ) | 11 | ||||||||
Selling, general and administrative expenses as a percentage of total revenues | 10 | % | 11 | % | 10 | % | |||||||||||
Vehicle interest expense | $ | 97 | $ | 114 | $ | 75 | (15 | ) | 52 | ||||||||
Adjusted EBITDA | $ | 147 | $ | 231 | $ | 235 | (36 | ) | (2 | ) | |||||||
Transaction Days (in thousands)(b) | 50,139 | 50,417 | 50,301 | (1 | ) | — | |||||||||||
Average Vehicles (in whole units)(c) | 180,723 | 180,400 | 178,100 | — | 1 | ||||||||||||
Vehicle Utilization(c) | 76 | % | 77 | % | 77 | % | |||||||||||
Total RPD (in whole dollars)(d) | $ | 43.73 | $ | 43.49 | $ | 42.35 | 1 | 3 | |||||||||
Total RPU Per Month (in whole dollars)(e) | $ | 1,011 | $ | 1,013 | $ | 997 | — | 2 | |||||||||
Net Depreciation Per Unit Per Month (in whole dollars)(f) | $ | 205 | $ | 199 | $ | 192 | 3 | 4 | |||||||||
Percentage of program vehicles as of period end | 38 | % | 37 | % | 34 | % |
Years Ended December 31, | Percent Increase/(Decrease) | |||||||||||||||||||||||||||||||||||||||||||||
Years Ended December 31, | Percent Increase/(Decrease) | |||||||||||||||||||||||||||||||||||||||||||||
($ In millions) | 2019 | 2018 | 2017 | 2019 vs. 2018 | 2018 vs. 2017 | |||||||||||||||||||||||||||||||||||||||||
($ In millions, except as noted) | ($ In millions, except as noted) | 2021 | 2020 | 2019 | 2021 vs. 2020 | 2020 vs. 2019 | ||||||||||||||||||||||||||||||||||||||||
Total revenues | $ | 672 | $ | 748 | $ | 640 | (10 | )% | 17 | % | Total revenues | $ | 985 | $ | 872 | $ | 1,899 | 13% | (54)% | |||||||||||||||||||||||||||
Depreciation of revenue earning vehicles and lease charges | $ | 469 | $ | 564 | $ | 478 | (17 | ) | 18 | Depreciation of revenue earning vehicles and lease charges | $ | 154 | $ | 243 | $ | 388 | (37) | (37) | ||||||||||||||||||||||||||||
Direct vehicle and operating expenses | $ | 28 | $ | 37 | $ | 40 | (24 | ) | (8 | ) | Direct vehicle and operating expenses | $ | 606 | $ | 647 | $ | 1,128 | (6) | (43) | |||||||||||||||||||||||||||
Direct vehicle and operating expenses as a percentage of total revenues | Direct vehicle and operating expenses as a percentage of total revenues | 61 | % | 74 | % | 59 | % | |||||||||||||||||||||||||||||||||||||||
Non-vehicle depreciation and amortization | Non-vehicle depreciation and amortization | $ | 16 | $ | 19 | $ | 20 | (17) | (7) | |||||||||||||||||||||||||||||||||||||
Selling, general and administrative expenses | $ | 35 | $ | 37 | $ | 35 | (6 | ) | 6 | Selling, general and administrative expenses | $ | 136 | $ | 164 | $ | 202 | (17) | (19) | ||||||||||||||||||||||||||||
Selling, general and administrative expenses as a percentage of total revenues | Selling, general and administrative expenses as a percentage of total revenues | 14 | % | 19 | % | 11 | % | |||||||||||||||||||||||||||||||||||||||
Vehicle interest expense | $ | 52 | $ | 43 | $ | 30 | 19 | 43 | Vehicle interest expense | $ | 59 | $ | 80 | $ | 89 | (26) | (10) | |||||||||||||||||||||||||||||
Reorganization items, net | Reorganization items, net | $ | 12 | $ | — | $ | — | NM | NM | |||||||||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | 100 | $ | 82 | $ | 74 | 22 | 11 | Adjusted EBITDA | $ | 90 | $ | (229) | $ | 115 | NM | NM | |||||||||||||||||||||||||||||
Average Vehicles - Donlen | 210,000 | 188,100 | 204,300 | 12 | (8 | ) | ||||||||||||||||||||||||||||||||||||||||
Transaction Days (in thousands)(b) | Transaction Days (in thousands)(b) | 20,488 | 22,283 | 44,720 | (8) | (50) | ||||||||||||||||||||||||||||||||||||||||
Average Vehicles (in whole units)(c) | Average Vehicles (in whole units)(c) | 77,643 | 102,793 | 160,382 | (24) | (36) | ||||||||||||||||||||||||||||||||||||||||
Vehicle Utilization(c) | Vehicle Utilization(c) | 72 | % | 59 | % | 76 | % | |||||||||||||||||||||||||||||||||||||||
Total RPD (in whole dollars)(d) | Total RPD (in whole dollars)(d) | $ | 49.30 | $ | 42.12 | $ | 46.18 | 17 | (9) | |||||||||||||||||||||||||||||||||||||
Total RPU Per Month (in whole dollars)(e) | Total RPU Per Month (in whole dollars)(e) | $ | 1,084 | $ | 761 | $ | 1,073 | 42 | (29) | |||||||||||||||||||||||||||||||||||||
Net Depreciation Per Unit Per Month (in whole dollars)(f) | Net Depreciation Per Unit Per Month (in whole dollars)(f) | $ | 171 | $ | 214 | $ | 219 | (20) | (2) | |||||||||||||||||||||||||||||||||||||
Percentage of program vehicles as of period end | Percentage of program vehicles as of period end | 32 | % | 31 | % | 43 | % |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Net income (loss) attributable to Hertz | $ | 1,157 | $ | (1,846) | $ | (53) | |||||||||||
Adjustments: | |||||||||||||||||
Income tax provision (benefit) | 318 | (328) | 65 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Non-vehicle debt interest, net(1) | 185 | 151 | 304 | ||||||||||||||
Vehicle debt-related charges(2) | 72 | 55 | 38 | ||||||||||||||
Restructuring and restructuring related charges(3) | 76 | 64 | 14 | ||||||||||||||
Intangible and other asset impairment(4) | — | 213 | — | ||||||||||||||
Write-off of intercompany loan(5) | — | 133 | — | ||||||||||||||
Information technology and finance transformation costs(6) | 12 | 42 | 114 | ||||||||||||||
Reorganization items, net(7) | 513 | 175 | — | ||||||||||||||
Pre-reorganization and non-debtor financing charges(8) | 42 | 109 | — | ||||||||||||||
Gain from the sale of Donlen(9) | (400) | — | — | ||||||||||||||
Other items(10) | (41) | 12 | (36) | ||||||||||||||
Adjusted Corporate EBITDA | $ | 2,130 | $ | (995) | $ | 649 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Net income (loss) attributable to Hertz | $ | (53 | ) | $ | (220 | ) | $ | 332 | |||
Adjustments: | |||||||||||
Income tax provision (benefit) | 65 | (28 | ) | (902 | ) | ||||||
Non-vehicle depreciation and amortization | 203 | 218 | 240 | ||||||||
Non-vehicle debt interest, net | 304 | 284 | 301 | ||||||||
Vehicle debt-related charges(1) | 38 | 36 | 32 | ||||||||
Loss on extinguishment of vehicle debt(2) | — | 22 | — | ||||||||
Restructuring and restructuring related charges(3) | 14 | 32 | 20 | ||||||||
Impairment charges and asset write-downs(4) | — | — | 118 | ||||||||
Information technology and finance transformation costs(5) | 114 | 98 | 68 | ||||||||
Other items(6) | (36 | ) | (9 | ) | 58 | ||||||
Adjusted Corporate EBITDA | $ | 649 | $ | 433 | $ | 267 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Net income (loss) attributable to Hertz Global | $ | 366 | $ | (1,714) | $ | (58) | |||||||||||
Adjustments: | |||||||||||||||||
Income tax provision (benefit) | 318 | (329) | 63 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Non-vehicle debt interest, net(1) | 185 | 153 | 311 | ||||||||||||||
Vehicle debt-related charges(2) | 72 | 55 | 38 | ||||||||||||||
Restructuring and restructuring related charges(3) | 76 | 64 | 14 | ||||||||||||||
Intangible and other asset impairment(4) | — | 213 | — | ||||||||||||||
Information technology and finance transformation costs(6) | 12 | 42 | 114 | ||||||||||||||
Reorganization items, net(7) | 677 | 175 | — | ||||||||||||||
Pre-reorganization and non-debtor financing charges(8) | 42 | 109 | — | ||||||||||||||
Gain from the sale of Donlen(9) | (400) | — | — | ||||||||||||||
Change in fair value of Public Warrants(11) | 627 | — | — | ||||||||||||||
Other items(10) | (41) | 12 | (36) | ||||||||||||||
Adjusted Corporate EBITDA | $ | 2,130 | $ | (995) | $ | 649 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Net income (loss) attributable to Hertz Global | $ | (58 | ) | $ | (225 | ) | $ | 327 | |||
Adjustments: | |||||||||||
Income tax provision (benefit) | 63 | (30 | ) | (902 | ) | ||||||
Non-vehicle depreciation and amortization | 203 | 218 | 240 | ||||||||
Non-vehicle debt interest, net | 311 | 291 | 306 | ||||||||
Vehicle debt-related charges(1) | 38 | 36 | 32 | ||||||||
Loss on extinguishment of vehicle debt(2) | — | 22 | — | ||||||||
Restructuring and restructuring related charges(3) | 14 | 32 | 20 | ||||||||
Impairment charges and asset write-downs(4) | — | — | 118 | ||||||||
Information technology and finance transformation costs(5) | 114 | 98 | 68 | ||||||||
Other items(6) | (36 | ) | (9 | ) | 58 | ||||||
Adjusted Corporate EBITDA | $ | 649 | $ | 433 | $ | 267 |
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) |
U.S. Rental Car | International Rental Car | ||||||||||||||||
Years Ended December 31, | |||||||||||||||||
2019 | 2018 | 2017 | 2019 | 2018 | 2017 | ||||||||||||
Transaction Days (in thousands) | 155,859 | 149,463 | 140,382 | 50,139 | 50,417 | 50,301 | |||||||||||
Average Vehicles (in whole units) | 534,879 | 506,900 | 484,700 | 180,723 | 180,400 | 178,100 | |||||||||||
Number of days in period (in whole units) | 365 | 365 | 365 | 365 | 365 | 365 | |||||||||||
Available Car Days (in thousands) | 195,231 | 185,019 | 176,916 | 65,964 | 65,846 | 65,007 | |||||||||||
Vehicle Utilization | 80 | % | 81 | % | 79 | % | 76 | % | 77 | % | 77 | % |
U.S. Rental Car | International Rental Car | ||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||
($ in millions, except as noted) | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | |||||||||||||||||
Total Revenues | $ | 6,938 | $ | 6,480 | $ | 5,994 | $ | 2,169 | $ | 2,276 | $ | 2,169 | |||||||||||
Ancillary retail vehicle sales revenues | (122 | ) | (102 | ) | (90 | ) | — | (1 | ) | — | |||||||||||||
Foreign currency adjustment(1) | — | — | — | 24 | (82 | ) | (39 | ) | |||||||||||||||
Total Rental Revenues | $ | 6,816 | $ | 6,378 | $ | 5,904 | $ | 2,193 | $ | 2,193 | $ | 2,130 | |||||||||||
Transaction Days (in thousands) | 155,859 | 149,463 | 140,382 | 50,139 | 50,417 | 50,301 | |||||||||||||||||
Total RPD (in whole dollars) | $ | 43.73 | $ | 42.67 | $ | 42.06 | $ | 43.73 | $ | 43.49 | $ | 42.35 |
Americas RAC | International RAC | ||||||||||||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 | 2020 | 2019 | ||||||||||||||||||||||||||||||
Transaction Days (in thousands) | 100,085 | 85,016 | 161,278 | 20,488 | 22,283 | 44,720 | |||||||||||||||||||||||||||||
Average Vehicles (in whole units) | 355,647 | 437,547 | 555,220 | 77,643 | 102,793 | 160,382 | |||||||||||||||||||||||||||||
Number of days in period (in whole units) | 365 | 366 | 365 | 365 | 366 | 365 | |||||||||||||||||||||||||||||
Available Car Days (in thousands) | 129,944 | 160,142 | 202,655 | 28,366 | 37,622 | 58,539 | |||||||||||||||||||||||||||||
Vehicle Utilization | 77 | % | 53 | % | 80 | % | 72 | % | 59 | % | 76 | % |
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) |
U.S. Rental Car | International Rental Car | ||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||
($ in millions, except as noted) | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | |||||||||||||||||
Total Rental Revenues | $ | 6,816 | $ | 6,378 | $ | 5,904 | $ | 2,193 | $ | 2,193 | $ | 2,130 | |||||||||||
Average Vehicles (in whole units) | 534,879 | 506,900 | 484,700 | 180,723 | 180,400 | 178,100 | |||||||||||||||||
Total revenue per unit (in whole dollars) | $ | 12,743 | $ | 12,582 | $ | 12,181 | $ | 12,135 | $ | 12,156 | $ | 11,960 | |||||||||||
Number of months in period (in whole units) | 12 | 12 | 12 | 12 | 12 | 12 | |||||||||||||||||
Total RPU Per Month (in whole dollars) | $ | 1,062 | $ | 1,049 | $ | 1,015 | $ | 1,011 | $ | 1,013 | $ | 997 |
Americas RAC | International RAC | ||||||||||||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||||||||||||
($ in millions, except as noted) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||||||
Revenues | $ | 6,215 | $ | 3,756 | $ | 7,208 | $ | 985 | $ | 872 | $ | 1,899 | |||||||||||||||||||||||
Foreign currency adjustment(1) | (3) | 3 | 8 | 25 | 66 | 166 | |||||||||||||||||||||||||||||
Total Revenues-adjusted for foreign currency | $ | 6,212 | $ | 3,759 | $ | 7,216 | $ | 1,010 | $ | 938 | $ | 2,065 | |||||||||||||||||||||||
Transaction Days (in thousands) | 100,085 | 85,016 | 161,278 | 20,488 | 22,283 | 44,720 | |||||||||||||||||||||||||||||
Total RPD (in dollars) | $ | 62.07 | $ | 44.22 | $ | 44.75 | $ | 49.30 | $ | 42.12 | $ | 46.18 |
Americas RAC | International RAC | ||||||||||||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||||||||||||
($ in millions, except as noted) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||||||
Total Revenues-adjusted for foreign currency | $ | 6,212 | $ | 3,759 | $ | 7,216 | $ | 1,010 | $ | 938 | $ | 2,065 | |||||||||||||||||||||||
Average Vehicles (in whole units) | 355,647 | 437,547 | 555,220 | 77,643 | 102,793 | 160,382 | |||||||||||||||||||||||||||||
Total revenue per unit (in whole dollars) | $ | 17,467 | $ | 8,591 | $ | 12,997 | $ | 13,009 | $ | 9,130 | $ | 12,877 | |||||||||||||||||||||||
Number of months in period (in whole units) | 12 | 12 | 12 | 12 | 12 | 12 | |||||||||||||||||||||||||||||
Total RPU Per Month (in whole dollars) | $ | 1,456 | $ | 716 | $ | 1,083 | $ | 1,084 | $ | 761 | $ | 1,073 |
Americas RAC | International RAC | ||||||||||||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||||||||||||
($ in millions, except as noted) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||||||
Depreciation of revenue earning vehicles and lease charges | $ | 343 | $ | 1,352 | $ | 1,706 | $ | 154 | $ | 243 | $ | 388 | |||||||||||||||||||||||
Foreign currency adjustment(1) | — | 1 | 1 | 5 | 21 | 34 | |||||||||||||||||||||||||||||
Adjusted depreciation of revenue earning vehicles and lease charges | $ | 343 | $ | 1,353 | $ | 1,707 | $ | 159 | $ | 264 | $ | 422 | |||||||||||||||||||||||
Average Vehicles (in whole units) | 355,647 | 437,547 | 555,220 | 77,643 | 102,793 | 160,382 | |||||||||||||||||||||||||||||
Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars) | $ | 964 | $ | 3,093 | $ | 3,075 | $ | 2,051 | $ | 2,567 | $ | 2,631 | |||||||||||||||||||||||
Number of months in period (in whole units) | 12 | 12 | 12 | 12 | 12 | 12 | |||||||||||||||||||||||||||||
Depreciation Per Unit Per Month (in whole dollars) | $ | 80 | $ | 258 | $ | 256 | $ | 171 | $ | 214 | $ | 219 |
U.S. Rental Car | International Rental Car | ||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||
($ in millions, except as noted) | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | |||||||||||||||||
Depreciation of revenue earning vehicles and lease charges | $ | 1,656 | $ | 1,678 | $ | 1,904 | $ | 440 | $ | 448 | $ | 416 | |||||||||||
Foreign currency adjustment(1) | — | — | — | 5 | (17 | ) | (7 | ) | |||||||||||||||
Adjusted depreciation of revenue earning vehicles and lease charges | $ | 1,656 | $ | 1,678 | $ | 1,904 | $ | 445 | $ | 431 | $ | 409 | |||||||||||
Average Vehicles (in whole units) | 534,879 | 506,900 | 484,700 | 180,723 | 180,400 | 178,100 | |||||||||||||||||
Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars) | $ | 3,096 | $ | 3,310 | $ | 3,928 | $ | 2,462 | $ | 2,389 | $ | 2,299 | |||||||||||
Number of months in period (in whole units) | 12 | 12 | 12 | 12 | 12 | 12 | |||||||||||||||||
Depreciation Per Unit Per Month (in whole dollars) | $ | 258 | $ | 276 | $ | 327 | $ | 205 | $ | 199 | $ | 192 |
Years Ended December 31, | 2021 vs. 2020 | 2020 vs. 2019 | |||||||||||||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | $ Change | $ Change | ||||||||||||||||||||||||
Cash provided by (used in): | |||||||||||||||||||||||||||||
Operating activities | $ | 1,806 | $ | 956 | $ | 2,907 | $ | 850 | $ | (1,951) | |||||||||||||||||||
Investing activities | (3,544) | 4,591 | (4,425) | (8,135) | 9,016 | ||||||||||||||||||||||||
Financing activities | 2,872 | (5,403) | 1,467 | 8,275 | (6,870) | ||||||||||||||||||||||||
Effect of exchange rate changes | (34) | 46 | 1 | (80) | 45 | ||||||||||||||||||||||||
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | $ | 1,100 | $ | 190 | $ | (50) | $ | 910 | $ | 240 |
Years Ended December 31, | 2019 vs. 2018 | 2018 vs. 2017 | |||||||||||||||||
(In millions) | 2019 | 2018 | 2017 | $ Change | $ Change | ||||||||||||||
Cash provided by (used in): | |||||||||||||||||||
Operating activities | $ | 2,907 | $ | 2,563 | $ | 2,399 | $ | 344 | $ | 164 | |||||||||
Investing activities | (4,425 | ) | (4,197 | ) | (3,000 | ) | (228 | ) | (1,197 | ) | |||||||||
Financing activities | 1,467 | 1,554 | 983 | (87 | ) | 571 | |||||||||||||
Effect of exchange rate changes | 1 | (14 | ) | 28 | 15 | (42 | ) | ||||||||||||
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | $ | (50 | ) | $ | (94 | ) | $ | 410 | $ | 44 | $ | (504 | ) |
Years Ended December 31, | 2021 vs. 2020 | 2020 vs. 2019 | |||||||||||||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | $ Change | $ Change | ||||||||||||||||||||||||
Cash provided by (used in): | |||||||||||||||||||||||||||||
Operating activities | $ | 1,806 | $ | 953 | $ | 2,900 | $ | 853 | $ | (1,947) | |||||||||||||||||||
Investing activities | (3,544) | 4,591 | (4,425) | (8,135) | 9,016 | ||||||||||||||||||||||||
Financing activities | 2,845 | (5,372) | 1,474 | 8,217 | (6,846) | ||||||||||||||||||||||||
Effect of exchange rate changes | (34) | 46 | 1 | (80) | 45 | ||||||||||||||||||||||||
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | $ | 1,073 | $ | 218 | $ | (50) | $ | 855 | $ | 268 |
Years Ended December 31, | 2019 vs. 2018 | 2018 vs. 2017 | |||||||||||||||||
(In millions) | 2019 | 2018 | 2017 | $ Change | $ Change | ||||||||||||||
Cash provided by (used in): | |||||||||||||||||||
Operating activities | $ | 2,900 | $ | 2,556 | $ | 2,394 | $ | 344 | $ | 162 | |||||||||
Investing activities | (4,425 | ) | (4,197 | ) | (3,000 | ) | (228 | ) | (1,197 | ) | |||||||||
Financing activities | 1,474 | 1,561 | 988 | (87 | ) | 573 | |||||||||||||
Effect of exchange rate changes | 1 | (14 | ) | 28 | 15 | (42 | ) | ||||||||||||
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | $ | (50 | ) | $ | (94 | ) | $ | 410 | $ | 44 | $ | (504 | ) |
(In millions) | As of December 31, 2021 | As of December 31, 2020 | |||||||||
Cash and cash equivalents | $ | 2,257 | $ | 1,096 | |||||||
Availability under the First Lien RCF | 925 | — | |||||||||
Corporate liquidity | $ | 3,182 | $ | 1,096 |
(In millions) | As of December 31, 2019 | As of December 31, 2018 | |||||
Cash and cash equivalents | $ | 865 | $ | 1,127 | |||
Availability under the Senior RCF | 526 | 496 | |||||
Corporate liquidity | $ | 1,391 | $ | 1,623 |
Cash inflow (cash outflow) | Revenue Earning Vehicles | ||||||||||||||||
(In millions) | Capital Expenditures | Disposal Proceeds | Net Capital Proceeds (Expenditures) | ||||||||||||||
2021 | $ | (7,154) | $ | 2,818 | $ | (4,336) | |||||||||||
2020 | (5,542) | 10,098 | 4,556 | ||||||||||||||
2019 | (13,714) | 9,486 | (4,228) |
Cash inflow (cash outflow) | Revenue Earning Vehicles | ||||||||||
(In millions) | Capital Expenditures | Disposal Proceeds | Net Capital Expenditures | ||||||||
2019 | $ | (13,714 | ) | $ | 9,486 | $ | (4,228 | ) | |||
2018 | (12,493 | ) | 8,452 | (4,041 | ) | ||||||
2017 | (10,596 | ) | 7,653 | (2,943 | ) |
Cash inflow (cash outflow) | Years Ended December 31, | 2021 vs. 2020 | 2020 vs. 2019 | ||||||||||||||||||||||||||||||||||||||
($ in millions) | 2021 | 2020 | 2019 | $ Change | % Change | $ Change | % Change | ||||||||||||||||||||||||||||||||||
Americas RAC segment | $ | (3,763) | $ | 3,903 | $ | (3,075) | $ | (7,666) | NM | $ | 6,978 | NM | |||||||||||||||||||||||||||||
International RAC segment | (489) | 929 | (466) | (1,418) | NM | 1,395 | NM | ||||||||||||||||||||||||||||||||||
All other operations | (84) | (276) | (687) | 192 | (70) | 411 | (60) | ||||||||||||||||||||||||||||||||||
Total | $ | (4,336) | $ | 4,556 | $ | (4,228) | $ | (8,892) | NM | $ | 8,784 | NM |
Cash inflow (cash outflow) | Years Ended December 31, | 2019 vs. 2018 | 2018 vs. 2017 | ||||||||||||||||||||||
($ in millions) | 2019 | 2018 | 2017 | $ Change | % Change | $ Change | % Change | ||||||||||||||||||
U.S. Rental Car | $ | (3,013 | ) | $ | (2,992 | ) | $ | (1,877 | ) | $ | (21 | ) | 1 | % | $ | (1,115 | ) | 59 | % | ||||||
International Rental Car | (528 | ) | (422 | ) | (518 | ) | (106 | ) | 25 | 96 | (19 | ) | |||||||||||||
All Other Operations | (687 | ) | (627 | ) | (548 | ) | (60 | ) | 10 | (79 | ) | 14 | |||||||||||||
Total | $ | (4,228 | ) | $ | (4,041 | ) | $ | (2,943 | ) | $ | (187 | ) | 5 | $ | (1,098 | ) | 37 |
Cash inflow (cash outflow) | Non-Vehicle Capital Assets | ||||||||||||||||
(In millions) | Capital Expenditures | Disposal Proceeds | Net Capital Expenditures | ||||||||||||||
2021 | $ | (71) | $ | 16 | $ | (55) | |||||||||||
2020 | (98) | 60 | (38) | ||||||||||||||
2019 | (224) | 27 | (197) |
Cash inflow (cash outflow) | Non-Vehicle Capital Assets | ||||||||||
(In millions) | Capital Expenditures | Disposal Proceeds | Net Capital Expenditures | ||||||||
2019 | $ | (224 | ) | $ | 27 | $ | (197 | ) | |||
2018 | (177 | ) | 51 | (126 | ) | ||||||
2017 | (173 | ) | 21 | (152 | ) |
Cash inflow (cash outflow) | Years Ended December 31, | 2021 vs. 2020 | 2020 vs. 2019 | ||||||||||||||||||||||||||||||||||||||
($ in millions) | 2021 | 2020 | 2019 | $ Change | % Change | $ Change | % Change | ||||||||||||||||||||||||||||||||||
Americas RAC segment | $ | (35) | $ | 3 | $ | (72) | $ | (38) | NM | $ | 75 | NM | |||||||||||||||||||||||||||||
International RAC segment | (8) | (4) | (12) | (4) | 100 | 8 | (67) | ||||||||||||||||||||||||||||||||||
All other operations | (1) | (4) | (4) | 3 | (75) | — | — | ||||||||||||||||||||||||||||||||||
Corporate | (11) | (33) | (109) | 22 | (67) | 76 | (70) | ||||||||||||||||||||||||||||||||||
Total | $ | (55) | $ | (38) | $ | (197) | $ | (17) | 45 | $ | 159 | (81) |
Cash inflow (cash outflow) | Years Ended December 31, | 2019 vs. 2018 | 2018 vs. 2017 | ||||||||||||||||||||||
($ in millions) | 2019 | 2018 | 2017 | $ Change | % Change | $ Change | % Change | ||||||||||||||||||
U.S. Rental Car | $ | (65 | ) | $ | (35 | ) | $ | (78 | ) | $ | (30 | ) | 86 | % | $ | 43 | (55 | )% | |||||||
International Rental Car | (19 | ) | (14 | ) | (20 | ) | (5 | ) | 36 | 6 | (30 | ) | |||||||||||||
All Other Operations | (4 | ) | (4 | ) | (5 | ) | — | — | 1 | (20 | ) | ||||||||||||||
Corporate | (109 | ) | (73 | ) | (49 | ) | (36 | ) | 49 | (24 | ) | 49 | |||||||||||||
Total | $ | (197 | ) | $ | (126 | ) | $ | (152 | ) | $ | (71 | ) | 56 | $ | 26 | (17 | ) |
Payments Due by Period | |||||||||||||||||||||||||||||
(In millions) | Total | 2022 | 2023 to 2024 | 2025 to 2026 | After 2026 | ||||||||||||||||||||||||
Vehicles: | |||||||||||||||||||||||||||||
Debt obligation | $ | 7,954 | $ | 311 | $ | 5,643 | $ | 2,000 | $ | — | |||||||||||||||||||
Interest on debt(1) | 459 | 165 | 209 | 85 | — | ||||||||||||||||||||||||
Non-Vehicle: | |||||||||||||||||||||||||||||
Debt obligation | 3,055 | 20 | 35 | 526 | 2,474 | ||||||||||||||||||||||||
Interest on debt(1) | 1,007 | 157 | 296 | 296 | 258 | ||||||||||||||||||||||||
Minimum fixed obligations for operating leases | 2,536 | 390 | 616 | 377 | 1,153 | ||||||||||||||||||||||||
Purchase obligations and other(2) | 170 | 91 | 53 | — | 26 | ||||||||||||||||||||||||
Total | $ | 15,181 | $ | 1,134 | $ | 6,852 | $ | 3,284 | $ | 3,911 |
Payments Due by Period | |||||||||||||||||||
(In millions) | Total | 2020 | 2021 to 2022 | 2023 to 2024 | After 2024 | ||||||||||||||
Vehicles: | |||||||||||||||||||
Debt obligation | $ | 13,415 | $ | 2,418 | $ | 7,688 | $ | 3,309 | $ | — | |||||||||
Interest on debt(a) | 904 | 402 | 399 | 103 | — | ||||||||||||||
Non-Vehicle: | |||||||||||||||||||
Debt obligation | 3,755 | 20 | 887 | 1,421 | 1,427 | ||||||||||||||
Interest on debt(a) | 1,145 | 225 | 419 | 274 | 227 | ||||||||||||||
Minimum fixed obligations for operating leases(b) | 2,915 | 494 | 774 | 480 | 1,167 | ||||||||||||||
Commitments to purchase vehicles(c) | 8,185 | 8,185 | — | — | — | ||||||||||||||
Purchase obligations and other(d) | 428 | 206 | 142 | 60 | 20 | ||||||||||||||
Total | $ | 30,747 | $ | 11,950 | $ | 10,309 | $ | 5,647 | $ | 2,841 |
Page | ||||||||
Hertz Global Holdings, Inc. and Subsidiaries | ||||||||
The Hertz Corporation and Subsidiaries | ||||||||
Notes to the Consolidated Financial Statements | ||||||||
Schedule I | ||||||||
Schedule II | ||||||||
Calculation of Non-Program Depreciation on Revenue Earning Vehicles in the Americas Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | For the year ended December 31, |
Auditing the Company’s calculation of depreciation for non-program vehicles related to the Americas RAC segment was complex due to the significant estimation uncertainty and management judgment to determine the estimated residual values at the expected time of disposal. The significant estimation uncertainty was primarily due to management’s assumptions of future consumer demand for vehicles within their current fleet, the disposal channel of those vehicles and other external market conditions. Additionally, auditing the calculation of depreciation was challenging due to the volume of data inputs utilized in management’s calculation, including historical sales data from multiple sources at varying levels of disaggregation along with additional data specific to the Company’s current fleet. |
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s measurement of depreciation expense for non-program vehicles related to the Americas RAC segment. To test the depreciation calculation for non-program vehicles, our audit procedures included, among others, testing the completeness and accuracy of the underlying data by comparing historical sales data and vehicle information used in the calculation (e.g., make, model, trim) to external sources and the Company’s records. We tested the base depreciation rate calculations performed within the IT application and evaluated the reasonableness of other significant assumptions such as resale market conditions, including consumer demand for specific vehicles, and disposition channels to assess the reasonableness of the residual value estimates made by management. Additionally, we performed analytical procedures to evaluate historical gains and losses recognized upon disposal in order to retrospectively review the reasonableness of management’s estimates. | |||||||
Valuation of | ||||||||
Description of the Matter | As disclosed in Notes 2 and 14 to the consolidated financial statements, the Company is self-insured for public liability, property damage, general liability, liability insurance supplement and worker's The adequacy of the liabilities is regularly monitored based on evolving accident claim history and insurance related state legislation changes. If the Company’s estimates change or if actual results differ from these assumptions, the amount of the recorded liabilities are adjusted to reflect these results. Auditing | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s |
To test the valuation of the | ||||||||
Valuation of Indefinite-Lived Intangible Tradename Assets in the International Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | As disclosed in Note 5 to the consolidated financial statements, the Company’s indefinite-lived intangible tradename assets totaled $2.794 billion, with $600 million relating to indefinite-lived intangible tradename assets in the International RAC segment, as of December 31, 2021. As disclosed in Note 2 to the consolidated financial statements, indefinite-lived intangible assets are tested for impairment on an annual basis, as of October 1, and at interim periods when circumstances require as a result of a triggering event. Auditing the Company’s indefinite-lived intangible tradename assets in the International RAC segment was complex and highly judgmental due to the significant estimation required to determine its fair value as a result of the Company’s future projections, operating performance and the current industry and economic environment in which the Company operates. The Company’s estimate of fair value for the indefinite-lived intangible tradename assets in the International RAC segment required significant judgment to estimate the impact of changes in revenues and profitability, industry trends on future operating results and the future cash flows expected to be generated. In addition, the fair value estimate of these indefinite-lived intangible tradename assets in the International RAC segment was sensitive to significant assumptions such as projected revenues, royalty rates, terminal period revenue growth rates and the weighted average cost of capital. These significant assumptions are affected by expected future market or economic conditions, including the continuing impact of COVID-19 and the Chip Shortage as defined in the Company’s Form 10-K. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s indefinite-lived intangible tradename assets impairment review processes. For example, we tested controls over management’s review of the assumptions, including assumptions related to projected financial information, as outlined above that are used in the indefinite-lived intangible tradename assets impairment test. To test the estimated fair value of the International RAC segment’s indefinite-lived intangible tradename assets, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions and the completeness and accuracy of the underlying data used by the Company in its analyses. We compared the significant assumptions used by management to current industry and economic trends, expected changes to the Company’s business model, the Company’s historical results and other relevant factors. We assessed the historical accuracy of management’s estimates, including projected financial information, and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the International RAC segment indefinite-lived intangible tradename assets that would result from hypothetical changes in the assumptions. We also involved valuation specialists to assist in our evaluation of the Company’s model, valuation methodologies, and certain significant assumptions, such as the royalty rates, the terminal period revenue growth rates and the weighted average cost of capital. |
Calculation of Non-Program Depreciation on Revenue Earning Vehicles in the Americas Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | For the year ended December 31, 2021, total depreciation of revenue earning vehicles and lease charges in the Americas RAC segment was $343 million, including gains and losses on disposals. As discussed in Note 2 to the consolidated financial statements, depreciation rates are reviewed on a quarterly basis based on management’s ongoing assessment of present and estimated future market conditions, the effect of these conditions on residual values at the expected time of disposal and the estimated holding period for the revenue earning vehicles. The Company’s fleet is comprised of vehicles that are subject to and are not subject to vehicle repurchase programs (“program vehicles” and “non-program vehicles,” respectively). For program vehicles, the manufacturers guarantee a specified price or depreciation rate upon disposal, versus non-program vehicles where the Company estimates the residual value of the vehicle at the expected time of disposal. |
Auditing the Company’s calculation of depreciation for non-program vehicles related to the Americas RAC segment was complex due to the significant estimation uncertainty and management judgment to determine the estimated residual values at the expected time of disposal. The significant estimation uncertainty was primarily due to management’s assumptions of future consumer demand for vehicles within their current fleet, the disposal channel of those vehicles and other external market conditions. Additionally, auditing the calculation of depreciation was challenging due to the volume of data inputs utilized in management’s calculation, including historical sales data from multiple sources at varying levels of disaggregation along with additional data specific to the Company’s current fleet. | ||||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s measurement of depreciation expense for non-program vehicles related to the Americas RAC segment. For example, we tested controls over management’s quarterly review of the depreciation rates, which included their procedures to validate the completeness and accuracy of the data used in the calculation and their assessment of significant assumptions, specifically the estimated residual values of non-program vehicles related to the Americas RAC segment. To test the depreciation calculation for non-program vehicles, our audit procedures included, among others, testing the completeness and accuracy of the underlying data by comparing historical sales data and vehicle information used in the calculation (e.g., make, model, trim) to external sources and the Company’s records. We tested the base depreciation rate calculations performed within the IT application and evaluated the reasonableness of other significant assumptions such as resale market conditions, including consumer demand for specific vehicles, and disposition channels to assess the reasonableness of the residual value estimates made by management. Additionally, we performed analytical procedures to evaluate historical gains and losses recognized upon disposal in order to retrospectively review the reasonableness of management’s estimates. | |||||||
Valuation of Self-insured Liabilities | ||||||||
Description of the Matter | As disclosed in Notes 2 and 14 to the consolidated financial statements, the Company is self-insured for public liability, property damage, general liability, liability insurance supplement and worker's compensation. The Company records liabilities for these matters based on actuarial analyses of historical claim activity and estimates of both reported accident claims not yet paid and claims incurred but not yet reported. The estimated self-insured liabilities as of December 31, 2021 were $463 million. The actuarial analyses that determine the claims incurred but not yet reported portion of the liability balances considers a variety of factors, including the frequency and severity of losses, changes in claim reporting and resolution patterns, insurance industry practices, the regulatory environment and legal precedent. The adequacy of the liabilities is regularly monitored based on evolving accident claim history and insurance related state legislation changes. If the Company’s estimates change or if actual results differ from these assumptions, the amount of the recorded liabilities are adjusted to reflect these results. Auditing self-insured liabilities is complex and required the involvement of our actuarial specialists due to the significant valuation uncertainty associated with the estimate, management’s application of complex judgments and the use of actuarial methods. In addition, the self-insured liabilities estimates are sensitive to management’s assumptions, including claim frequency, actuarial evaluations of historical claim experience and future projections of ultimate losses used in the computation of self-insured liabilities. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s self-insured liabilities process. For example, we tested controls over management’s review of the assumptions outlined above that are used in the self-insured liabilities calculation and the completeness and accuracy of the data underlying the self-insured liabilities. |
To test the valuation of the self-insured liabilities, we performed audit procedures that included involving our internal actuarial specialists to assist us in developing an independent estimate of liability and evaluating the methods used by management and the reasonableness of assumptions used in their models (e.g., actuarial evaluations of historical claim experience and future projections of ultimate losses). We compared the Company's reserve to the estimate of liability developed by our actuarial specialists based on the underlying claims data and independently selected assumptions. | ||||||||
Valuation of Indefinite-Lived Intangible Tradename Assets in the International Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | As disclosed in Note 5 to the consolidated financial statements, the Company’s indefinite-lived intangible tradename assets totaled $2.794 billion, with $600 million relating to indefinite-lived intangible tradename assets in the International RAC segment, as of December 31, 2021. As disclosed in Note 2 to the consolidated financial statements, indefinite-lived intangible assets are tested for impairment on an annual basis, as of October 1, and at interim periods when circumstances require as a result of a triggering event. Auditing the Company’s indefinite-lived intangible tradename assets in the International RAC segment was complex and highly judgmental due to the significant estimation required to determine its fair value as a result of the Company’s future projections, operating performance and the current industry and economic environment in which the Company operates. The Company’s estimate of fair value for the indefinite-lived intangible tradename assets in the International RAC segment required significant judgment to estimate the impact of changes in revenues and profitability, industry trends on future operating results and the future cash flows expected to be generated. In addition, the fair value estimate of these indefinite-lived intangible tradename assets in the International RAC segment was sensitive to significant assumptions such as projected revenues, royalty rates, terminal period revenue growth rates and the weighted average cost of capital. These significant assumptions are affected by expected future market or economic conditions, including the continuing impact of COVID-19 and the Chip Shortage as defined in the Company’s Form 10-K. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s indefinite-lived intangible tradename assets impairment review processes. For example, we tested controls over management’s review of the assumptions, including assumptions related to projected financial information, as outlined above that are used in the indefinite-lived intangible tradename assets impairment test. To test the estimated fair value of the International RAC segment’s indefinite-lived intangible tradename assets, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions and the completeness and accuracy of the underlying data used by the Company in its analyses. We compared the significant assumptions used by management to current industry and economic trends, expected changes to the Company’s business model, the Company’s historical results and other relevant factors. We assessed the historical accuracy of management’s estimates, including projected financial information, and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the International RAC segment indefinite-lived intangible tradename assets that would result from hypothetical changes in the assumptions. We also involved valuation specialists to assist in our evaluation of the Company’s model, valuation methodologies, and certain significant assumptions, such as the royalty rates, the terminal period revenue growth rates and the weighted average cost of capital. |
December 31, 2021 | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 2,258 | $ | 1,096 | |||||||
Restricted cash and cash equivalents: | |||||||||||
Vehicle | 77 | 50 | |||||||||
Non-vehicle | 316 | 361 | |||||||||
Total restricted cash and cash equivalents | 393 | 411 | |||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 2,651 | 1,507 | |||||||||
Receivables: | |||||||||||
Vehicle | 62 | 164 | |||||||||
Non-vehicle, net of allowance of $48 and $46, respectively | 696 | 613 | |||||||||
Total receivables, net | 758 | 777 | |||||||||
Prepaid expenses and other assets | 1,017 | 373 | |||||||||
Revenue earning vehicles: | |||||||||||
Vehicles | 10,836 | 7,540 | |||||||||
Less: accumulated depreciation | (1,610) | (1,478) | |||||||||
Total revenue earning vehicles, net | 9,226 | 6,062 | |||||||||
Property and equipment, net | 608 | 666 | |||||||||
Operating lease right-of-use assets | 1,566 | 1,675 | |||||||||
Intangible assets, net | 2,912 | 2,992 | |||||||||
Goodwill | 1,045 | 1,045 | |||||||||
Assets held for sale | — | 1,811 | |||||||||
Total assets(1) | $ | 19,783 | $ | 16,908 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Accounts payable: | |||||||||||
Vehicle | $ | 56 | $ | 29 | |||||||
Non-vehicle | 516 | 389 | |||||||||
Total accounts payable | 572 | 418 | |||||||||
Accrued liabilities | 863 | 759 | |||||||||
Accrued taxes, net | 157 | 121 | |||||||||
Debt: | |||||||||||
Vehicle | 7,921 | 6,024 | |||||||||
Non-vehicle | 2,986 | 243 | |||||||||
Total debt | 10,907 | 6,267 | |||||||||
Public Warrants | 1,324 | — | |||||||||
Operating lease liabilities | 1,510 | 1,636 | |||||||||
Self-insured liabilities | 463 | 488 | |||||||||
Deferred income taxes, net | 1,010 | 730 | |||||||||
Total liabilities not subject to compromise | 16,806 | 10,419 | |||||||||
Liabilities subject to compromise | — | 4,965 | |||||||||
Liabilities held for sale | — | 1,431 | |||||||||
Total liabilities(1) | 16,806 | 16,815 | |||||||||
Commitments and contingencies | 0 | 0 | |||||||||
Stockholders' equity: | |||||||||||
Preferred stock, $0.01 par value, no shares issued and outstanding | — | — | |||||||||
Common stock, $0.01 par value, 477,233,278 and 158,235,410 shares issued, respectively, and 449,782,424 and 156,206,478 shares outstanding, respectively | 5 | 2 | |||||||||
Treasury stock, at cost, 27,450,854 and 2,028,932 common shares, respectively | (708) | (100) | |||||||||
Additional paid-in capital | 6,209 | 3,047 | |||||||||
Retained earnings (Accumulated deficit) | (2,315) | (2,681) | |||||||||
Accumulated other comprehensive income (loss) | (214) | (212) | |||||||||
Stockholders' equity attributable to Hertz Global | 2,977 | 56 | |||||||||
Noncontrolling interests | — | 37 | |||||||||
Total stockholders' equity | 2,977 | 93 | |||||||||
Total liabilities and stockholders' equity | $ | 19,783 | $ | 16,908 |
December 31, 2019 | December 31, 2018 | ||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 865 | $ | 1,127 | |||
Restricted cash and cash equivalents: | |||||||
Vehicle | 466 | 257 | |||||
Non-vehicle | 29 | 26 | |||||
Total restricted cash and cash equivalents | 495 | 283 | |||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 1,360 | 1,410 | |||||
Receivables: | |||||||
Vehicle | 791 | 625 | |||||
Non-vehicle, net of allowance of $35 and $27, respectively | 1,049 | 962 | |||||
Total receivables, net | 1,840 | 1,587 | |||||
Prepaid expenses and other assets | 689 | 902 | |||||
Revenue earning vehicles: | |||||||
Vehicles | 17,085 | 15,703 | |||||
Less: accumulated depreciation | (3,296 | ) | (3,284 | ) | |||
Total revenue earning vehicles, net | 13,789 | 12,419 | |||||
Property and equipment, net | 757 | 778 | |||||
Operating lease right-of-use assets | 1,871 | — | |||||
Intangible assets, net | 3,238 | 3,203 | |||||
Goodwill | 1,083 | 1,083 | |||||
Total assets(a) | $ | 24,627 | $ | 21,382 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Accounts payable: | |||||||
Vehicle | $ | 289 | $ | 284 | |||
Non-vehicle | 654 | 704 | |||||
Total accounts payable | 943 | 988 | |||||
Accrued liabilities | 1,186 | 1,304 | |||||
Accrued taxes, net | 150 | 136 | |||||
Debt: | |||||||
Vehicle | 13,368 | 11,902 | |||||
Non-vehicle | 3,721 | 4,422 | |||||
Total debt | 17,089 | 16,324 | |||||
Operating lease liabilities | 1,848 | — | |||||
Public liability and property damage | 399 | 418 | |||||
Deferred income taxes, net | 1,124 | 1,092 | |||||
Total liabilities(a) | 22,739 | 20,262 | |||||
Commitments and contingencies | |||||||
Stockholders' equity: | |||||||
Preferred stock, $0.01 par value, no shares issued and outstanding | — | — | |||||
Common stock, $0.01 par value, 144 and 86 shares issued, respectively and 142 and 84 shares outstanding, respectively | 1 | 1 | |||||
Additional paid-in capital | 3,024 | 2,261 | |||||
Accumulated deficit | (967 | ) | (909 | ) | |||
Accumulated other comprehensive income (loss) | (189 | ) | (192 | ) | |||
Treasury stock, at cost, 2 shares and 2 shares, respectively | (100 | ) | (100 | ) | |||
Stockholders' equity attributable to Hertz Global | 1,769 | 1,061 | |||||
Noncontrolling interests | 119 | 59 | |||||
Total stockholders' equity | 1,888 | 1,120 | |||||
Total liabilities and stockholders' equity | $ | 24,627 | $ | 21,382 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 | |||||||||||
Expenses: | |||||||||||||||||
Direct vehicle and operating | 3,920 | 3,423 | 5,305 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 497 | 2,030 | 2,563 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Selling, general and administrative | 688 | 645 | 949 | ||||||||||||||
Interest expense, net: | |||||||||||||||||
Vehicle | 284 | 455 | 494 | ||||||||||||||
Non-vehicle (excludes contractual interest of $129 million for the year ended December 31, 2020) | 185 | 153 | 311 | ||||||||||||||
Total interest expense, net | 469 | 608 | 805 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Other (income) expense, net | (21) | (9) | (59) | ||||||||||||||
Reorganization items, net | 677 | 175 | — | ||||||||||||||
(Gain) from the sale of a business | (400) | — | — | ||||||||||||||
Change in fair value of Public Warrants | 627 | — | — | ||||||||||||||
Total expenses | 6,653 | 7,310 | 9,766 | ||||||||||||||
Income (loss) before income taxes | 683 | (2,052) | 13 | ||||||||||||||
Income tax (provision) benefit | (318) | 329 | (63) | ||||||||||||||
Net income (loss) | 365 | (1,723) | (50) | ||||||||||||||
Net (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Net income (loss) attributable to Hertz Global | 366 | (1,714) | (58) | ||||||||||||||
Series A Preferred Stock deemed dividends | (450) | — | — | ||||||||||||||
Net income (loss) available to Hertz Global common stockholders | $ | (84) | $ | (1,714) | $ | (58) | |||||||||||
Weighted-average common shares outstanding: | |||||||||||||||||
Basic | 315 | 150 | 117 | ||||||||||||||
Diluted | 315 | 150 | 117 | ||||||||||||||
Earnings (loss) per common share: | |||||||||||||||||
Basic | $ | (0.27) | $ | (11.44) | $ | (0.49) | |||||||||||
Diluted | $ | (0.27) | $ | (11.44) | $ | (0.49) |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Revenues: | |||||||||||
Worldwide vehicle rental | $ | 9,107 | $ | 8,756 | $ | 8,163 | |||||
All other operations | 672 | 748 | 640 | ||||||||
Total revenues | 9,779 | 9,504 | 8,803 | ||||||||
Expenses: | |||||||||||
Direct vehicle and operating | 5,486 | 5,355 | 4,958 | ||||||||
Depreciation of revenue earning vehicles and lease charges | 2,565 | 2,690 | 2,798 | ||||||||
Selling, general and administrative | 969 | 1,017 | 880 | ||||||||
Interest expense, net: | |||||||||||
Vehicle | 494 | 448 | 331 | ||||||||
Non-vehicle | 311 | 291 | 306 | ||||||||
Total interest expense, net | 805 | 739 | 637 | ||||||||
Goodwill and intangible asset impairments | — | — | 86 | ||||||||
Other (income) expense, net | (59 | ) | (40 | ) | 19 | ||||||
Total expenses | 9,766 | 9,761 | 9,378 | ||||||||
Income (loss) before income taxes | 13 | (257 | ) | (575 | ) | ||||||
Income tax (provision) benefit | (63 | ) | 30 | 902 | |||||||
Net income (loss) | (50 | ) | (227 | ) | 327 | ||||||
Net (income) loss attributable to noncontrolling interests | (8 | ) | 2 | — | |||||||
Net income (loss) attributable to Hertz Global | $ | (58 | ) | $ | (225 | ) | $ | 327 | |||
Weighted-average shares outstanding: | |||||||||||
Basic | 117 | 96 | 95 | ||||||||
Diluted | 117 | 96 | 95 | ||||||||
Earnings (loss) per share: | |||||||||||
Basic earnings (loss) per share | $ | (0.49 | ) | $ | (2.35 | ) | $ | 3.44 | |||
Diluted earnings (loss) per share | $ | (0.49 | ) | $ | (2.35 | ) | $ | 3.44 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net income (loss) | $ | 365 | $ | (1,723) | $ | (50) | |||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Foreign currency translation adjustments | (36) | (19) | 6 | ||||||||||||||
Net gain (loss) on pension and postretirement benefit plans | 25 | (11) | (11) | ||||||||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial net losses | 15 | 13 | 11 | ||||||||||||||
Total other comprehensive income (loss) before income taxes | 4 | (17) | 6 | ||||||||||||||
Income tax (provision) benefit related to pension and postretirement benefit plans | (3) | (4) | (1) | ||||||||||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on pension and postretirement benefit plans | (3) | (2) | (2) | ||||||||||||||
Total other comprehensive income (loss) | (2) | (23) | 3 | ||||||||||||||
Total comprehensive income (loss) | 363 | (1,746) | (47) | ||||||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Comprehensive income (loss) attributable to Hertz Global | $ | 364 | $ | (1,737) | $ | (55) |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net income (loss) | $ | (50 | ) | $ | (227 | ) | $ | 327 | |||
Other comprehensive income (loss): | |||||||||||
Foreign currency translation adjustments | 6 | (34 | ) | 14 | |||||||
Reclassification of foreign currency items to other (income) expense, net | — | (1 | ) | 8 | |||||||
Reclassification of realized gain on securities to other (income) expense | — | — | (3 | ) | |||||||
Net gain (loss) on defined benefit pension plans | (11 | ) | (44 | ) | 40 | ||||||
Reclassification from other comprehensive income (loss) to selling, general and administrative expense for amortization of actuarial (gains) losses on defined benefit pension plans | — | — | 6 | ||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial (gains) losses on defined benefit pension plans | 11 | 5 | — | ||||||||
Total other comprehensive income (loss) before income taxes | 6 | (74 | ) | 65 | |||||||
Income tax (provision) benefit related to net gains and losses on defined benefit pension plans | (1 | ) | 12 | (10 | ) | ||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on defined benefit pension plans | (2 | ) | (1 | ) | (2 | ) | |||||
Total other comprehensive income (loss) | 3 | (63 | ) | 53 | |||||||
Total comprehensive income (loss) | (47 | ) | (290 | ) | 380 | ||||||
Comprehensive (income) loss attributable to noncontrolling interests | (8 | ) | 2 | — | |||||||
Comprehensive income (loss) attributable to Hertz Global | $ | (55 | ) | $ | (288 | ) | $ | 380 |
Mezzanine Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock Shares | Preferred Stock Amount | Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock Shares | Treasury Stock Amount | Stockholders' Equity Attributable to Hertz Global | Non- controlling Interests | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2018 | — | $ | — | 84 | $ | 1 | $ | 2,261 | $ | (909) | $ | (192) | 2 | $ | (100) | $ | 1,061 | $ | 59 | $ | 1,120 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | (58) | — | — | — | (58) | 8 | (50) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | 3 | — | — | 3 | — | 3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | — | (3) | — | — | — | — | (3) | — | (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | 18 | — | — | — | — | 18 | — | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 Rights Offering, net | — | — | 58 | — | 748 | — | — | — | — | 748 | — | 748 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | — | — | — | 52 | 52 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | — | — | 142 | 1 | 3,024 | (967) | (189) | 2 | (100) | 1,769 | 119 | 1,888 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | (1,714) | — | — | — | (1,714) | (9) | (1,723) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | (23) | — | — | (23) | — | (23) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | — | (3) | — | — | — | — | (3) | — | (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | (2) | — | — | — | — | (2) | — | (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ATM Program, net | — | — | 14 | 1 | 28 | — | — | — | — | 29 | — | 29 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests, net | — | — | — | — | — | — | — | — | — | — | (73) | (73) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2020 | — | — | 156 | 2 | 3,047 | (2,681) | (212) | 2 | (100) | 56 | 37 | 93 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | 366 | — | — | — | 366 | (1) | 365 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | (2) | — | — | (2) | — | (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | 10 | — | — | — | — | 10 | — | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cancellation of stock-based awards | — | — | — | — | (10) | — | — | — | — | (10) | — | (10) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cancellation of common and treasury shares in exchange for new common shares | — | — | (142) | (2) | (98) | — | — | (2) | 100 | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common stockholders | — | — | — | — | (239) | — | — | — | — | (239) | — | (239) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from Plan Sponsors | — | — | 277 | 3 | 2,778 | — | — | — | — | 2,781 | — | 2,781 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 Rights Offering, net | — | — | 181 | 2 | 1,800 | — | — | — | — | 1,802 | — | 1,802 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Public Warrant issuance | — | — | — | — | (800) | — | — | — | — | (800) | — | (800) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock issuance, net | 2 | 1,433 | — | — | — | — | — | — | — | 1,433 | — | 1,433 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of preferred stock, net | (2) | (1,433) | — | — | (450) | — | — | — | — | (1,883) | — | (1,883) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Public Warrant exercises(1) | — | — | 5 | — | 180 | — | — | — | — | 180 | — | 180 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nasdaq listing and share repurchases(2) | — | — | (27) | — | (9) | — | — | 27 | (708) | (717) | — | (717) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests(3) | — | — | — | — | — | — | — | — | — | — | (36) | (36) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | — | $ | — | 450 | $ | 5 | $ | 6,209 | $ | (2,315) | $ | (214) | 27 | $ | (708) | $ | 2,977 | $ | — | $ | 2,977 |
Preferred Stock Shares | Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Treasury Stock Shares | Treasury Stock Amount | Stockholders' Equity Attributable to Hertz Global | Non- controlling Interests | Total Stockholders' Equity | ||||||||||||||||||||||||||||||
Balance as of: | ||||||||||||||||||||||||||||||||||||||||
December 31, 2016 | — | 83 | $ | 1 | $ | 2,227 | $ | (882 | ) | $ | (171 | ) | 2 | $ | (100 | ) | $ | 1,075 | $ | — | $ | 1,075 | ||||||||||||||||||
Change in accounting principle | — | — | — | — | 49 | — | — | — | 49 | — | 49 | |||||||||||||||||||||||||||||
January 1, 2017 (as adjusted) | — | 83 | 1 | 2,227 | (833 | ) | (171 | ) | 2 | (100 | ) | 1,124 | — | 1,124 | ||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | 327 | — | — | — | 327 | — | 327 | |||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | 53 | — | — | 53 | — | 53 | |||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | 1 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | 13 | — | — | — | — | 13 | — | 13 | |||||||||||||||||||||||||||||
Other | — | — | — | 3 | — | — | — | — | 3 | — | 3 | |||||||||||||||||||||||||||||
December 31, 2017 | — | 84 | 1 | 2,243 | (506 | ) | (118 | ) | 2 | (100 | ) | 1,520 | — | 1,520 | ||||||||||||||||||||||||||
Change in accounting principle | — | — | — | — | (189 | ) | — | — | — | (189 | ) | — | (189 | ) | ||||||||||||||||||||||||||
January 1, 2018 (as adjusted) | — | 84 | 1 | 2,243 | (695 | ) | (118 | ) | 2 | (100 | ) | 1,331 | — | 1,331 | ||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (225 | ) | — | — | — | (225 | ) | (2 | ) | (227 | ) | |||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (63 | ) | — | — | (63 | ) | — | (63 | ) | ||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | (3 | ) | — | — | — | — | (3 | ) | — | (3 | ) | ||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | 21 | — | — | — | — | 21 | — | 21 | |||||||||||||||||||||||||||||
Reclassification of income tax effects resulting from the Tax Cuts and Jobs Act | — | — | — | — | 11 | (11 | ) | — | — | — | — | — | ||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | — | — | 61 | 61 | |||||||||||||||||||||||||||||
December 31, 2018 | — | 84 | 1 | 2,261 | (909 | ) | (192 | ) | 2 | (100 | ) | 1,061 | 59 | 1,120 | ||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (58 | ) | — | — | — | (58 | ) | 8 | (50 | ) | ||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | 3 | — | — | 3 | — | 3 | |||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | (3 | ) | — | — | — | — | (3 | ) | — | (3 | ) | ||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | 18 | — | — | — | — | 18 | — | 18 | |||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | — | — | 52 | 52 | |||||||||||||||||||||||||||||
Rights Offering, net | — | 58 | — | 748 | — | — | — | — | 748 | — | 748 | |||||||||||||||||||||||||||||
December 31, 2019 | — | 142 | $ | 1 | $ | 3,024 | $ | (967 | ) | $ | (189 | ) | 2 | $ | (100 | ) | $ | 1,769 | $ | 119 | $ | 1,888 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 365 | $ | (1,723) | $ | (50) | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and reserves for revenue earning vehicles | 600 | 2,259 | 2,791 | ||||||||||||||
Depreciation and amortization, non-vehicle | 196 | 225 | 203 | ||||||||||||||
Amortization of deferred financing costs and debt discount (premium) | 122 | 59 | 52 | ||||||||||||||
Loss on extinguishment of debt | 8 | 5 | 43 | ||||||||||||||
Stock-based compensation charges | 10 | (2) | 18 | ||||||||||||||
Provision for receivables allowance | 125 | 94 | 53 | ||||||||||||||
Deferred income taxes, net | 270 | (353) | 27 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Reorganization items, net | 314 | 8 | — | ||||||||||||||
(Gain) loss from the sale of a business | (400) | — | — | ||||||||||||||
(Gain) loss on marketable securities | — | — | (30) | ||||||||||||||
(Gain) loss on sale of non-vehicle capital assets | (8) | (24) | (39) | ||||||||||||||
Change in fair value of Public Warrants | 627 | — | — | ||||||||||||||
Other | (5) | 5 | (9) | ||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||
Non-vehicle receivables | (210) | 195 | (88) | ||||||||||||||
Prepaid expenses and other assets | (20) | 92 | (8) | ||||||||||||||
Operating lease right-of-use assets | 274 | 366 | 402 | ||||||||||||||
Non-vehicle accounts payable | (70) | 98 | 65 | ||||||||||||||
Accrued liabilities | (108) | (61) | (98) | ||||||||||||||
Accrued taxes, net | 24 | (52) | 14 | ||||||||||||||
Operating lease liabilities | (291) | (375) | (428) | ||||||||||||||
Self-insured liabilities | (17) | (76) | (18) | ||||||||||||||
Net cash provided by (used in) operating activities | 1,806 | 953 | 2,900 | ||||||||||||||
Cash flows from investing activities: | |||||||||||||||||
Revenue earning vehicles expenditures | (7,154) | (5,542) | (13,714) | ||||||||||||||
Proceeds from disposal of revenue earning vehicles | 2,818 | 10,098 | 9,486 | ||||||||||||||
Non-vehicle capital asset expenditures | (71) | (98) | (224) | ||||||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 16 | 60 | 27 | ||||||||||||||
Sales of marketable securities | — | 74 | — | ||||||||||||||
Collateral payments | (303) | — | — | ||||||||||||||
Collateral returned in exchange for letters of credit | 280 | — | — | ||||||||||||||
Proceeds from the sale of a business, net of cash sold | 871 | — | — | ||||||||||||||
Other | (1) | (1) | — | ||||||||||||||
Net cash provided by (used in) investing activities | (3,544) | 4,591 | (4,425) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from issuance of vehicle debt | 14,323 | 4,546 | 13,013 | ||||||||||||||
Repayments of vehicle debt | (12,607) | (10,751) | (11,530) | ||||||||||||||
Proceeds from issuance of non-vehicle debt | 4,644 | 1,812 | 3,016 |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cash flows from operating activities: | |||||||||||
Net income (loss) | $ | (50 | ) | $ | (227 | ) | $ | 327 | |||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||
Depreciation and reserves for revenue earning vehicles | 2,791 | 2,546 | 2,722 | ||||||||
Depreciation and amortization, non-vehicle | 203 | 218 | 240 | ||||||||
Amortization of deferred financing costs and debt discount (premium) | 52 | 50 | 46 | ||||||||
Loss on extinguishment of debt | 43 | 22 | 13 | ||||||||
Stock-based compensation charges | 18 | 14 | 19 | ||||||||
Provision for receivables allowance | 53 | 35 | 33 | ||||||||
Deferred income taxes, net | 27 | (66 | ) | (922 | ) | ||||||
(Gain) loss on marketable securities | (30 | ) | (20 | ) | (3 | ) | |||||
(Gain) loss on sale of non-vehicle capital assets | (39 | ) | (1 | ) | (2 | ) | |||||
(Gain) loss on derivatives | (12 | ) | 7 | — | |||||||
Impairment charges and asset write-downs | — | — | 116 | ||||||||
Other | 3 | — | (5 | ) | |||||||
Changes in assets and liabilities: | |||||||||||
Non-vehicle receivables | (88 | ) | (136 | ) | (75 | ) | |||||
Prepaid expenses and other assets | (8 | ) | (23 | ) | (22 | ) | |||||
Operating lease right-of-use assets | 402 | — | — | ||||||||
Non-vehicle accounts payable | 65 | 70 | 20 | ||||||||
Accrued liabilities | (88 | ) | 75 | (86 | ) | ||||||
Accrued taxes, net | 14 | (8 | ) | (23 | ) | ||||||
Operating lease liabilities | (428 | ) | — | — | |||||||
Public liability and property damage | (28 | ) | — | (4 | ) | ||||||
Net cash provided by (used in) operating activities | 2,900 | 2,556 | 2,394 | ||||||||
Cash flows from investing activities: | |||||||||||
Revenue earning vehicles expenditures | (13,714 | ) | (12,493 | ) | (10,596 | ) | |||||
Proceeds from disposal of revenue earning vehicles | 9,486 | 8,452 | 7,653 | ||||||||
Non-vehicle capital asset expenditures | (224 | ) | (177 | ) | (173 | ) | |||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 27 | 51 | 21 | ||||||||
Proceeds from sale of Brazil Operations, net of retained cash | — | — | 94 | ||||||||
Acquisitions, net of cash acquired | (1 | ) | (2 | ) | (15 | ) | |||||
Purchases of marketable securities | — | (60 | ) | — | |||||||
Sales of marketable securities | — | 36 | 9 | ||||||||
Return of (investment in) equity investment | — | — | 7 | ||||||||
Other | 1 | (4 | ) | — | |||||||
Net cash provided by (used in) investing activities | (4,425 | ) | (4,197 | ) | (3,000 | ) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Repayments of non-vehicle debt | (6,352) | (855) | (3,732) | ||||||||||||||
Payment of financing costs | (185) | (75) | (53) | ||||||||||||||
Proceeds from Plan Sponsors | 2,781 | — | — | ||||||||||||||
Early redemption premium payment | (85) | — | (34) | ||||||||||||||
Proceeds from issuance of common stock, net | — | 28 | — | ||||||||||||||
Proceeds from exercises of Public Warrants | 77 | — | — | ||||||||||||||
Proceeds from the issuance of preferred stock, net | 1,433 | — | — | ||||||||||||||
Distributions to common stockholders | (239) | — | — | ||||||||||||||
Contributions from (distributions to) noncontrolling interests | (38) | (75) | 49 | ||||||||||||||
Proceeds from rights offerings, net | 1,639 | — | 748 | ||||||||||||||
Share repurchases | (654) | — | — | ||||||||||||||
Repurchase of preferred stock | (1,883) | — | — | ||||||||||||||
Payments for Nasdaq listing costs | (9) | — | — | ||||||||||||||
Other | — | (2) | (3) | ||||||||||||||
Net cash provided by (used in) financing activities | 2,845 | (5,372) | 1,474 | ||||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | (34) | 46 | 1 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | 1,073 | 218 | (50) | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period(1) | 1,578 | 1,360 | 1,410 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period(1) | $ | 2,651 | $ | 1,578 | $ | 1,360 | |||||||||||
Supplemental disclosures of cash flow information: | |||||||||||||||||
Cash paid during the period for: | |||||||||||||||||
Interest, net of amounts capitalized: | |||||||||||||||||
Vehicle | $ | 257 | $ | 335 | $ | 431 | |||||||||||
Non-vehicle | 198 | 109 | 272 | ||||||||||||||
Income taxes, net of refunds | 40 | (11) | 21 | ||||||||||||||
Operating lease liabilities | 472 | 546 | 575 | ||||||||||||||
Supplemental disclosures of non-cash information: | |||||||||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 27 | $ | 9 | $ | 165 | |||||||||||
Sales of revenue earning vehicles included in vehicle receivables | 33 | 144 | 667 | ||||||||||||||
Fleet payables included in liabilities subject to compromise | — | 2 | — | ||||||||||||||
Purchases of non-vehicle capital assets included in accounts payable | 24 | 7 | 40 | ||||||||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital leases | 79 | 32 | 23 | ||||||||||||||
Purchases of non-vehicle capital assets included in liabilities subject to compromise | — | 18 | — | ||||||||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 177 | 152 | 680 | ||||||||||||||
Public Warrant issuance | 800 | — | — | ||||||||||||||
Public Warrant exercises | 103 | — | — | ||||||||||||||
Backstop equity issuance | 164 | — | — | ||||||||||||||
Accrual for purchases of treasury shares | 54 | — | — |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from issuance of vehicle debt | 13,013 | 14,009 | 10,756 | ||||||||
Repayments of vehicle debt | (11,530 | ) | (12,426 | ) | (10,244 | ) | |||||
Proceeds from issuance of non-vehicle debt | 3,016 | 557 | 2,100 | ||||||||
Repayments of non-vehicle debt | (3,732 | ) | (571 | ) | (1,560 | ) | |||||
Payment of financing costs | (53 | ) | (47 | ) | (59 | ) | |||||
Early redemption premium payment | (34 | ) | (19 | ) | (5 | ) | |||||
Contributions from noncontrolling interests | 49 | 60 | — | ||||||||
Proceeds from Rights Offering, net | 748 | — | — | ||||||||
Other | (3 | ) | (2 | ) | — | ||||||
Net cash provided by (used in) financing activities | 1,474 | 1,561 | 988 | ||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | 1 | (14 | ) | 28 | |||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | (50 | ) | (94 | ) | 410 | ||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period | 1,410 | 1,504 | 1,094 | ||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | $ | 1,360 | $ | 1,410 | $ | 1,504 | |||||
Supplemental disclosures of cash flow information: | |||||||||||
Cash paid during the period for: | |||||||||||
Interest, net of amounts capitalized: | |||||||||||
Vehicle | $ | 431 | $ | 379 | $ | 291 | |||||
Non-vehicle | 272 | 286 | 291 | ||||||||
Income taxes, net of refunds | 21 | 26 | 54 | ||||||||
Operating lease liabilities | 575 | — | — | ||||||||
Supplemental disclosures of non-cash information: | |||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 165 | $ | 169 | $ | 194 | |||||
Sales of revenue earning vehicles included in vehicle receivables | 667 | 510 | 431 | ||||||||
Sales-type capital lease of revenue earning vehicles included in other receivables | — | 75 | — | ||||||||
Purchases of non-vehicle capital assets included in accounts payable | 40 | 42 | 65 | ||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital lease | 23 | 21 | 35 | ||||||||
Receivable on sale of Brazil Operations | — | — | 13 | ||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 680 | — | — |
December 31, 2021 | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 2,257 | $ | 1,096 | |||||||
Restricted cash and cash equivalents: | |||||||||||
Vehicle | 77 | 50 | |||||||||
Non-vehicle | 316 | 333 | |||||||||
Total restricted cash and cash equivalents | 393 | 383 | |||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 2,650 | 1,479 | |||||||||
Receivables: | |||||||||||
Vehicle | 62 | 164 | |||||||||
Non-vehicle, net of allowance of $48 and $46, respectively | 695 | 613 | |||||||||
Total receivables, net | 757 | 777 | |||||||||
Due from Hertz Holdings | — | 1 | |||||||||
Prepaid expenses and other assets | 1,016 | 372 | |||||||||
Revenue earning vehicles: | |||||||||||
Vehicles | 10,836 | 7,540 | |||||||||
Less: accumulated depreciation | (1,610) | (1,478) | |||||||||
Total revenue earning vehicles, net | 9,226 | 6,062 | |||||||||
Property and equipment, net | 608 | 666 | |||||||||
Operating lease right-of-use assets | 1,566 | 1,675 | |||||||||
Intangible assets, net | 2,912 | 2,992 | |||||||||
Goodwill | 1,045 | 1,045 | |||||||||
Assets held for sale | — | 1,811 | |||||||||
Total assets(1) | $ | 19,780 | $ | 16,880 | |||||||
LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT) | |||||||||||
Accounts payable: | |||||||||||
Vehicle | $ | 56 | $ | 29 | |||||||
Non-vehicle | 516 | 389 | |||||||||
Total accounts payable | 572 | 418 | |||||||||
Accrued liabilities | 809 | 759 | |||||||||
Accrued taxes, net | 157 | 121 | |||||||||
Debt: | |||||||||||
Vehicle | 7,921 | 6,024 | |||||||||
Non-vehicle | 2,986 | 243 | |||||||||
Total debt | 10,907 | 6,267 | |||||||||
Operating lease liabilities | 1,510 | 1,636 | |||||||||
Self-insured liabilities | 463 | 488 | |||||||||
Deferred income taxes, net | 1,012 | 735 | |||||||||
Total liabilities not subject to compromise | 15,430 | 10,424 | |||||||||
Liabilities subject to compromise | — | 5,030 | |||||||||
Liabilities held for sale | — | 1,431 | |||||||||
Total liabilities(1) | 15,430 | 16,885 | |||||||||
Commitments and contingencies | 0 | 0 | |||||||||
Stockholder's equity (deficit): | |||||||||||
Common stock, $0.01 par value, 3,000 shares authorized and 100 shares issued and outstanding | — | — | |||||||||
Additional paid-in capital | 7,190 | 3,953 | |||||||||
Retained earnings (Accumulated deficit) | (2,626) | (3,783) | |||||||||
Accumulated other comprehensive income (loss) | (214) | (212) | |||||||||
Stockholder's equity (deficit) attributable to Hertz | 4,350 | (42) | |||||||||
Noncontrolling interests | — | 37 | |||||||||
Total stockholder's equity (deficit) | 4,350 | (5) | |||||||||
Total liabilities and stockholder's equity (deficit) | $ | 19,780 | $ | 16,880 |
December 31, 2019 | December 31, 2018 | ||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 865 | $ | 1,127 | |||
Restricted cash and cash equivalents: | |||||||
Vehicle | 466 | 257 | |||||
Non-vehicle | 29 | 26 | |||||
Total restricted cash and cash equivalents | 495 | 283 | |||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 1,360 | 1,410 | |||||
Receivables: | |||||||
Vehicle | 791 | 625 | |||||
Non-vehicle, net of allowance of $35 and $27, respectively | 1,049 | 962 | |||||
Total receivables, net | 1,840 | 1,587 | |||||
Prepaid expenses and other assets | 689 | 902 | |||||
Revenue earning vehicles: | |||||||
Vehicles | 17,085 | 15,703 | |||||
Less: accumulated depreciation | (3,296 | ) | (3,284 | ) | |||
Total revenue earning vehicles, net | 13,789 | 12,419 | |||||
Property and equipment, net | 757 | 778 | |||||
Operating lease right-of-use assets | 1,871 | — | |||||
Intangible assets, net | 3,238 | 3,203 | |||||
Goodwill | 1,083 | 1,083 | |||||
Total assets(a) | $ | 24,627 | $ | 21,382 | |||
LIABILITIES AND STOCKHOLDER'S EQUITY | |||||||
Accounts payable: | |||||||
Vehicle | $ | 289 | $ | 284 | |||
Non-vehicle | 654 | 704 | |||||
Total accounts payable | 943 | 988 | |||||
Accrued liabilities | 1,186 | 1,304 | |||||
Accrued taxes, net | 150 | 136 | |||||
Debt: | |||||||
Vehicle | 13,368 | 11,902 | |||||
Non-vehicle | 3,721 | 4,422 | |||||
Total debt | 17,089 | 16,324 | |||||
Operating lease liabilities | 1,848 | — | |||||
Public liability and property damage | 399 | 418 | |||||
Deferred income taxes, net | 1,128 | 1,094 | |||||
Total liabilities(a) | 22,743 | 20,264 | |||||
Commitments and contingencies | |||||||
Stockholder's equity: | |||||||
Common stock, $0.01 par value, 3,000 shares authorized, 100 and 100 shares issued and outstanding, respectively | — | — | |||||
Additional paid-in capital | 3,955 | 3,187 | |||||
Due from affiliate | (64 | ) | (52 | ) | |||
Accumulated deficit | (1,937 | ) | (1,884 | ) | |||
Accumulated other comprehensive income (loss) | (189 | ) | (192 | ) | |||
Stockholder's equity attributable to Hertz | 1,765 | 1,059 | |||||
Noncontrolling interests | 119 | 59 | |||||
Total stockholder's equity | 1,884 | 1,118 | |||||
Total liabilities and stockholder's equity | $ | 24,627 | $ | 21,382 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 | |||||||||||
Expenses: | |||||||||||||||||
Direct vehicle and operating | 3,920 | 3,423 | 5,305 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 497 | 2,030 | 2,563 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Selling, general and administrative | 688 | 645 | 949 | ||||||||||||||
Interest expense, net: | |||||||||||||||||
Vehicle | 284 | 455 | 494 | ||||||||||||||
Non-vehicle (excludes contractual interest of $129 million for the year ended December 31, 2020) | 185 | 151 | 304 | ||||||||||||||
Total interest expense, net | 469 | 606 | 798 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Write-off of intercompany loan | — | 133 | — | ||||||||||||||
Other (income) expense, net | (21) | (9) | (59) | ||||||||||||||
Reorganization items, net | 513 | 175 | — | ||||||||||||||
(Gain) from the sale of a business | (400) | — | — | ||||||||||||||
Total expenses | 5,862 | 7,441 | 9,759 | ||||||||||||||
Income (loss) before income taxes | 1,474 | (2,183) | 20 | ||||||||||||||
Income tax (provision) benefit | (318) | 328 | (65) | ||||||||||||||
Net income (loss) | 1,156 | (1,855) | (45) | ||||||||||||||
Net (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Net income (loss) attributable to Hertz | $ | 1,157 | $ | (1,846) | $ | (53) |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Revenues: | |||||||||||
Worldwide vehicle rental | $ | 9,107 | $ | 8,756 | $ | 8,163 | |||||
All other operations | 672 | 748 | 640 | ||||||||
Total revenues | 9,779 | 9,504 | 8,803 | ||||||||
Expenses: | |||||||||||
Direct vehicle and operating | 5,486 | 5,355 | 4,958 | ||||||||
Depreciation of revenue earning vehicles and lease charges | 2,565 | 2,690 | 2,798 | ||||||||
Selling, general and administrative | 969 | 1,017 | 880 | ||||||||
Interest expense, net: | |||||||||||
Vehicle | 494 | 448 | 331 | ||||||||
Non-vehicle | 304 | 284 | 301 | ||||||||
Total interest expense, net | 798 | 732 | 632 | ||||||||
Goodwill and intangible asset impairments | — | — | 86 | ||||||||
Other (income) expense, net | (59 | ) | (40 | ) | 19 | ||||||
Total expenses | 9,759 | 9,754 | 9,373 | ||||||||
Income (loss) before income taxes | 20 | (250 | ) | (570 | ) | ||||||
Income tax (provision) benefit | (65 | ) | 28 | 902 | |||||||
Net income (loss) | (45 | ) | (222 | ) | 332 | ||||||
Net (income) loss attributable to noncontrolling interests | (8 | ) | 2 | — | |||||||
Net income (loss) attributable to Hertz | $ | (53 | ) | $ | (220 | ) | $ | 332 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net income (loss) | $ | 1,156 | $ | (1,855) | $ | (45) | |||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Foreign currency translation adjustments | (36) | (19) | 6 | ||||||||||||||
Net gain (loss) on pension and postretirement benefit plans | 25 | (11) | (11) | ||||||||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial net losses | 15 | 13 | 11 | ||||||||||||||
Total other comprehensive income (loss) before income taxes | 4 | (17) | 6 | ||||||||||||||
Income tax (provision) benefit related to pension and postretirement benefit plans | (3) | (4) | (1) | ||||||||||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on pension and postretirement benefit plans | (3) | (2) | (2) | ||||||||||||||
Total other comprehensive income (loss) | (2) | (23) | 3 | ||||||||||||||
Total comprehensive income (loss) | 1,154 | (1,878) | (42) | ||||||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Comprehensive income (loss) attributable to Hertz | $ | 1,155 | $ | (1,869) | $ | (50) |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net income (loss) | $ | (45 | ) | $ | (222 | ) | $ | 332 | |||
Other comprehensive income (loss): | |||||||||||
Foreign currency translation adjustments | 6 | (34 | ) | 14 | |||||||
Reclassification of foreign currency items to other (income) expense, net | — | (1 | ) | 8 | |||||||
Reclassification of realized gain on securities to other (income) expense | — | — | (3 | ) | |||||||
Net gain (loss) on defined benefit pension plans | (11 | ) | (44 | ) | 40 | ||||||
Reclassification from other comprehensive income (loss) to selling, general and administrative expense for amortization of actuarial (gains) losses on defined benefit pension plans | — | — | 6 | ||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial (gains) losses on defined benefit pension plans | 11 | 5 | — | ||||||||
Total other comprehensive income (loss) before income taxes | 6 | (74 | ) | 65 | |||||||
Income tax (provision) benefit related to net gains and losses on defined benefit pension plans | (1 | ) | 12 | (10 | ) | ||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on defined benefit pension plans | (2 | ) | (1 | ) | (2 | ) | |||||
Total other comprehensive income (loss) | 3 | (63 | ) | 53 | |||||||
Total comprehensive income (loss) | (42 | ) | (285 | ) | 385 | ||||||
Comprehensive (income) loss attributable to noncontrolling interests | (8 | ) | 2 | — | |||||||
Comprehensive income (loss) attributable to Hertz | $ | (50 | ) | $ | (283 | ) | $ | 385 |
Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Due From Affiliate | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Stockholder's Equity (Deficit) Attributable to Hertz | Noncontrolling Interests | Total Stockholder's Equity (Deficit) | |||||||||||||||||||||||||||||||||||||||||||||
Balance as of: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2018 | 100 | — | 3,187 | (52) | (1,884) | (192) | 1,059 | 59 | 1,118 | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (53) | — | (53) | 8 | (45) | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | 3 | 3 | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (12) | — | — | (12) | — | (12) | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | 18 | — | — | — | 18 | — | 18 | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from Hertz Holdings | — | — | 750 | — | — | — | 750 | — | 750 | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | 52 | 52 | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | 100 | — | 3,955 | (64) | (1,937) | (189) | 1,765 | 119 | 1,884 | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (1,846) | — | (1,846) | (9) | (1,855) | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (23) | (23) | — | (23) | ||||||||||||||||||||||||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (4) | — | — | (4) | — | (4) | ||||||||||||||||||||||||||||||||||||||||||||
Liabilities subject to compromise(1) | — | — | — | (65) | — | — | (65) | — | (65) | ||||||||||||||||||||||||||||||||||||||||||||
Write-off of intercompany loan(1) | — | — | — | 133 | — | — | 133 | — | 133 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | (2) | — | — | — | (2) | — | (2) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests, net | — | — | — | — | — | — | — | (73) | (73) | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2020 | 100 | — | 3,953 | — | (3,783) | (212) | (42) | 37 | (5) | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | 1,157 | — | 1,157 | (1) | 1,156 | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (2) | (2) | — | (2) | ||||||||||||||||||||||||||||||||||||||||||||
Non-cash distribution(1) | — | — | 65 | — | — | — | 65 | — | 65 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | 10 | — | — | — | 10 | — | 10 | ||||||||||||||||||||||||||||||||||||||||||||
Cancellation of stock-based awards | — | — | (10) | — | — | — | (10) | — | (10) | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from Hertz Holdings | — | — | 5,642 | — | — | — | 5,642 | — | 5,642 | ||||||||||||||||||||||||||||||||||||||||||||
Dividends to Hertz Holdings | — | — | (2,470) | — | — | — | (2,470) | — | (2,470) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests(2) | — | — | — | — | — | — | — | (36) | (36) | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | 100 | $ | — | $ | 7,190 | $ | — | $ | (2,626) | $ | (214) | $ | 4,350 | $ | — | $ | 4,350 |
Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Due From Affiliate | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Stockholder's Equity Attributable to Hertz | Noncontrolling Interests | Total Stockholder's Equity | ||||||||||||||||||||||||||
Balance as of: | ||||||||||||||||||||||||||||||||||
December 31, 2016 | 100 | $ | — | $ | 3,150 | $ | (37 | ) | $ | (1,867 | ) | $ | (171 | ) | $ | 1,075 | $ | — | $ | 1,075 | ||||||||||||||
Change in accounting principle | — | — | — | — | 49 | — | 49 | — | 49 | |||||||||||||||||||||||||
January 1, 2017 (as adjusted) | 100 | — | 3,150 | (37 | ) | (1,818 | ) | (171 | ) | 1,124 | — | 1,124 | ||||||||||||||||||||||
Net income (loss) | — | — | — | — | 332 | — | 332 | — | 332 | |||||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (5 | ) | — | — | (5 | ) | — | (5 | ) | ||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | 53 | 53 | — | 53 | |||||||||||||||||||||||||
Stock-based compensation charges | — | — | 13 | — | — | — | 13 | — | 13 | |||||||||||||||||||||||||
Other | — | — | 3 | — | — | — | 3 | — | 3 | |||||||||||||||||||||||||
December 31, 2017 | 100 | — | 3,166 | (42 | ) | (1,486 | ) | (118 | ) | 1,520 | — | 1,520 | ||||||||||||||||||||||
Change in accounting principle | — | — | — | — | (189 | ) | — | (189 | ) | — | (189 | ) | ||||||||||||||||||||||
January 1, 2018 (as adjusted) | 100 | — | 3,166 | (42 | ) | (1,675 | ) | (118 | ) | 1,331 | — | 1,331 | ||||||||||||||||||||||
Net income (loss) | — | — | — | — | (220 | ) | — | (220 | ) | (2 | ) | (222 | ) | |||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (10 | ) | — | — | (10 | ) | — | (10 | ) | ||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (63 | ) | (63 | ) | — | (63 | ) | ||||||||||||||||||||||
Reclassification of income tax effects resulting from the Tax Cuts and Jobs Act | — | — | — | — | 11 | (11 | ) | — | — | — | ||||||||||||||||||||||||
Stock-based compensation charges | — | — | 21 | — | — | — | 21 | — | 21 | |||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | 61 | 61 | |||||||||||||||||||||||||
December 31, 2018 | 100 | — | 3,187 | (52 | ) | (1,884 | ) | (192 | ) | 1,059 | 59 | 1,118 | ||||||||||||||||||||||
Net income (loss) | — | — | — | — | (53 | ) | — | (53 | ) | 8 | (45 | ) | ||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (12 | ) | — | — | (12 | ) | — | (12 | ) | ||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | 3 | 3 | — | 3 | |||||||||||||||||||||||||
Stock-based compensation charges | — | — | 18 | — | — | — | 18 | — | 18 | |||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | 52 | 52 | |||||||||||||||||||||||||
Contributions from Hertz Holdings | — | — | 750 | — | — | — | 750 | — | 750 | |||||||||||||||||||||||||
December 31, 2019 | 100 | $ | — | $ | 3,955 | $ | (64 | ) | $ | (1,937 | ) | $ | (189 | ) | $ | 1,765 | $ | 119 | $ | 1,884 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 1,156 | $ | (1,855) | $ | (45) | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and reserves for revenue earning vehicles | 600 | 2,259 | 2,791 | ||||||||||||||
Depreciation and amortization, non-vehicle | 196 | 225 | 203 | ||||||||||||||
Amortization of deferred financing costs and debt discount (premium) | 122 | 59 | 52 | ||||||||||||||
Loss on extinguishment of debt | 8 | 5 | 43 | ||||||||||||||
Stock-based compensation charges | 10 | (2) | 18 | ||||||||||||||
Provision for receivables allowance | 125 | 94 | 53 | ||||||||||||||
Deferred income taxes, net | 270 | (353) | 28 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Write-off of intercompany loan | — | 133 | — | ||||||||||||||
Reorganization items, net | 150 | 8 | — | ||||||||||||||
(Gain) loss from the sale of a business | (400) | — | — | ||||||||||||||
(Gain) loss on marketable securities | — | — | (30) | ||||||||||||||
(Gain) loss on sale of non-vehicle capital assets | (8) | (24) | (39) | ||||||||||||||
Other | (5) | 5 | (8) | ||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||
Non-vehicle receivables | (210) | 195 | (88) | ||||||||||||||
Prepaid expenses and other assets | (20) | 94 | (8) | ||||||||||||||
Operating lease right-of-use assets | 274 | 366 | 402 | ||||||||||||||
Non-vehicle accounts payable | (70) | 98 | 65 | ||||||||||||||
Accrued liabilities | (108) | (61) | (98) | ||||||||||||||
Accrued taxes, net | 24 | (52) | 14 | ||||||||||||||
Operating lease liabilities | (291) | (375) | (428) | ||||||||||||||
Self-insured liabilities | (17) | (76) | (18) | ||||||||||||||
Net cash provided by (used in) operating activities | 1,806 | 956 | 2,907 | ||||||||||||||
Cash flows from investing activities: | |||||||||||||||||
Revenue earning vehicles expenditures | (7,154) | (5,542) | (13,714) | ||||||||||||||
Proceeds from disposal of revenue earning vehicles | 2,818 | 10,098 | 9,486 | ||||||||||||||
Non-vehicle capital asset expenditures | (71) | (98) | (224) | ||||||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 16 | 60 | 27 | ||||||||||||||
Sales of marketable securities | — | 74 | — | ||||||||||||||
Collateral payments | (303) | — | — | ||||||||||||||
Collateral returned in exchange for letters of credit | 280 | — | — | ||||||||||||||
Proceeds from the sale of a business, net of cash sold | 871 | — | — | ||||||||||||||
Other | (1) | (1) | — | ||||||||||||||
Net cash provided by (used in) investing activities | (3,544) | 4,591 | (4,425) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from issuance of vehicle debt | 14,323 | 4,546 | 13,013 | ||||||||||||||
Repayments of vehicle debt | (12,607) | (10,751) | (11,530) | ||||||||||||||
Proceeds from issuance of non-vehicle debt | 4,644 | 1,812 | 3,016 | ||||||||||||||
Repayments of non-vehicle debt | (6,352) | (855) | (3,732) |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cash flows from operating activities: | |||||||||||
Net income (loss) | $ | (45 | ) | $ | (222 | ) | $ | 332 | |||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||
Depreciation and reserves for revenue earning vehicles | 2,791 | 2,546 | 2,722 | ||||||||
Depreciation and amortization, non-vehicle | 203 | 218 | 240 | ||||||||
Amortization of deferred financing costs and debt discount (premium) | 52 | 50 | 46 | ||||||||
Loss on extinguishment of debt | 43 | 22 | 13 | ||||||||
Stock-based compensation charges | 18 | 14 | 19 | ||||||||
Provision for receivables allowance | 53 | 35 | 33 | ||||||||
Deferred income taxes, net | 28 | (64 | ) | (922 | ) | ||||||
(Gain) loss on marketable securities | (30 | ) | (20 | ) | (3 | ) | |||||
(Gain) loss on sale of non-vehicle capital assets | (39 | ) | (1 | ) | (2 | ) | |||||
(Gain) loss on derivatives | (12 | ) | 7 | — | |||||||
Impairment charges and asset write-downs | — | — | 116 | ||||||||
Other | 4 | — | (4 | ) | |||||||
Changes in assets and liabilities: | |||||||||||
Non-vehicle receivables | (88 | ) | (136 | ) | (75 | ) | |||||
Prepaid expenses and other assets | (8 | ) | (23 | ) | (22 | ) | |||||
Operating lease right-of-use assets | 402 | — | — | ||||||||
Non-vehicle accounts payable | 65 | 70 | 20 | ||||||||
Accrued liabilities | (88 | ) | 75 | (86 | ) | ||||||
Accrued taxes, net | 14 | (8 | ) | (24 | ) | ||||||
Operating lease liabilities | (428 | ) | — | — | |||||||
Public liability and property damage | (28 | ) | — | (4 | ) | ||||||
Net cash provided by (used in) operating activities | 2,907 | 2,563 | 2,399 | ||||||||
Cash flows from investing activities: | |||||||||||
Revenue earning vehicles expenditures | (13,714 | ) | (12,493 | ) | (10,596 | ) | |||||
Proceeds from disposal of revenue earning vehicles | 9,486 | 8,452 | 7,653 | ||||||||
Non-vehicle capital asset expenditures | (224 | ) | (177 | ) | (173 | ) | |||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 27 | 51 | 21 | ||||||||
Proceeds from sale of Brazil Operations, net of retained cash | — | — | 94 | ||||||||
Acquisitions, net of cash acquired | (1 | ) | (2 | ) | (15 | ) | |||||
Purchases of marketable securities | — | (60 | ) | — | |||||||
Sales of marketable securities | — | 36 | 9 | ||||||||
Return of (investment in) equity investment | — | — | 7 | ||||||||
Other | 1 | (4 | ) | — | |||||||
Net cash provided by (used in) investing activities | (4,425 | ) | (4,197 | ) | (3,000 | ) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Payment of financing costs | (185) | (75) | (53) | ||||||||||||||
Early redemption premium payment | (85) | — | (34) | ||||||||||||||
Advances to Hertz Holdings | — | (5) | (12) | ||||||||||||||
Contributions from (distributions to) noncontrolling interests | (38) | (75) | 49 | ||||||||||||||
Dividends paid to Hertz Holdings | (2,470) | — | — | ||||||||||||||
Contributions from Hertz Holdings | 5,642 | — | 750 | ||||||||||||||
Net cash provided by (used in) financing activities | 2,872 | (5,403) | 1,467 | ||||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | (34) | 46 | 1 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | 1,100 | 190 | (50) | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period(1) | 1,550 | 1,360 | 1,410 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period (1) | $ | 2,650 | $ | 1,550 | $ | 1,360 | |||||||||||
Supplemental disclosures of cash flow information: | |||||||||||||||||
Cash paid during the period for: | |||||||||||||||||
Interest, net of amounts capitalized: | |||||||||||||||||
Vehicle | $ | 257 | $ | 335 | $ | 431 | |||||||||||
Non-vehicle | 198 | 109 | 272 | ||||||||||||||
Income taxes, net of refunds | 40 | (11) | 21 | ||||||||||||||
Operating lease liabilities | 472 | 546 | 575 | ||||||||||||||
Supplemental disclosures of non-cash information: | |||||||||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 27 | $ | 9 | $ | 165 | |||||||||||
Sales of revenue earning vehicles included in vehicle receivables | 33 | 144 | 667 | ||||||||||||||
Fleet payables included in liabilities subject to compromise | — | 2 | — | ||||||||||||||
Purchases of non-vehicle capital assets included in accounts payable | 24 | 7 | 40 | ||||||||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital leases | 79 | 32 | 23 | ||||||||||||||
Purchases of non-vehicle capital assets included in liabilities subject to compromise | — | 18 | — | ||||||||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 177 | 152 | 680 | ||||||||||||||
Non-cash capital contribution from Hertz Holdings | 65 | — | — |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from issuance of vehicle debt | 13,013 | 14,009 | 10,756 | ||||||||
Repayments of vehicle debt | (11,530 | ) | (12,426 | ) | (10,244 | ) | |||||
Proceeds from issuance of non-vehicle debt | 3,016 | 557 | 2,100 | ||||||||
Repayments of non-vehicle debt | (3,732 | ) | (571 | ) | (1,560 | ) | |||||
Payment of financing costs | (53 | ) | (47 | ) | (59 | ) | |||||
Early redemption premium payment | (34 | ) | (19 | ) | (5 | ) | |||||
Advances to Hertz Holdings | (12 | ) | (9 | ) | (6 | ) | |||||
Contributions from noncontrolling interests | 49 | 60 | — | ||||||||
Contributions from Hertz Holdings | 750 | — | — | ||||||||
Other | — | — | 1 | ||||||||
Net cash provided by (used in) financing activities | 1,467 | 1,554 | 983 | ||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | 1 | (14 | ) | 28 | |||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | (50 | ) | (94 | ) | 410 | ||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period | 1,410 | 1,504 | 1,094 | ||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | $ | 1,360 | $ | 1,410 | $ | 1,504 | |||||
Supplemental disclosures of cash flow information: | |||||||||||
Cash paid during the period for: | |||||||||||
Interest, net of amounts capitalized: | |||||||||||
Vehicle | $ | 431 | $ | 379 | $ | 291 | |||||
Non-vehicle | 272 | 286 | 291 | ||||||||
Income taxes, net of refunds | 21 | 26 | 54 | ||||||||
Operating lease liabilities | 575 | — | — | ||||||||
Supplemental disclosures of non-cash information: | |||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 165 | $ | 169 | $ | 194 | |||||
Sales of revenue earning vehicles included in vehicle receivables | 667 | 510 | 431 | ||||||||
Sales-type capital lease of revenue earning vehicles included in other receivables | — | 75 | — | ||||||||
Purchases of non-vehicle capital assets included in accounts payable | 40 | 42 | 65 | ||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital lease | 23 | 21 | 35 | ||||||||
Receivable on sale of Brazil Operations | — | — | 13 | ||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 680 | — | — |
Page | ||||||||
Hertz Global Holdings, Inc. and Subsidiaries | ||||||||
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42) | ||||||||
The Hertz Corporation and Subsidiaries | ||||||||
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42) | ||||||||
Notes to the Consolidated Financial Statements | ||||||||
Schedule I | ||||||||
Schedule II | ||||||||
Calculation of Non-Program Depreciation on Revenue Earning Vehicles in the Americas Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | For the year ended December 31, 2021, total depreciation of revenue earning vehicles and lease charges in the Americas RAC segment was $343 million, including gains and losses on disposals. As discussed in Note 2 to the consolidated financial statements, depreciation rates are reviewed on a quarterly basis based on management’s ongoing assessment of present and estimated future market conditions, the effect of these conditions on residual values at the expected time of disposal and the estimated holding period for the revenue earning vehicles. The Company’s fleet is comprised of vehicles that are subject to and are not subject to vehicle repurchase programs (“program vehicles” and “non-program vehicles,” respectively). For program vehicles, the manufacturers guarantee a specified price or depreciation rate upon disposal, versus non-program vehicles where the Company estimates the residual value of the vehicle at the expected time of disposal. |
Auditing the Company’s calculation of depreciation for non-program vehicles related to the Americas RAC segment was complex due to the significant estimation uncertainty and management judgment to determine the estimated residual values at the expected time of disposal. The significant estimation uncertainty was primarily due to management’s assumptions of future consumer demand for vehicles within their current fleet, the disposal channel of those vehicles and other external market conditions. Additionally, auditing the calculation of depreciation was challenging due to the volume of data inputs utilized in management’s calculation, including historical sales data from multiple sources at varying levels of disaggregation along with additional data specific to the Company’s current fleet. | ||||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s measurement of depreciation expense for non-program vehicles related to the Americas RAC segment. For example, we tested controls over management’s quarterly review of the depreciation rates, which included their procedures to validate the completeness and accuracy of the data used in the calculation and their assessment of significant assumptions, specifically the estimated residual values of non-program vehicles related to the Americas RAC segment. To test the depreciation calculation for non-program vehicles, our audit procedures included, among others, testing the completeness and accuracy of the underlying data by comparing historical sales data and vehicle information used in the calculation (e.g., make, model, trim) to external sources and the Company’s records. We tested the base depreciation rate calculations performed within the IT application and evaluated the reasonableness of other significant assumptions such as resale market conditions, including consumer demand for specific vehicles, and disposition channels to assess the reasonableness of the residual value estimates made by management. Additionally, we performed analytical procedures to evaluate historical gains and losses recognized upon disposal in order to retrospectively review the reasonableness of management’s estimates. | |||||||
Valuation of Self-insured Liabilities | ||||||||
Description of the Matter | As disclosed in Notes 2 and 14 to the consolidated financial statements, the Company is self-insured for public liability, property damage, general liability, liability insurance supplement and worker's compensation. The Company records liabilities for these matters based on actuarial analyses of historical claim activity and estimates of both reported accident claims not yet paid and claims incurred but not yet reported. The estimated self-insured liabilities as of December 31, 2021 were $463 million. The actuarial analyses that determine the claims incurred but not yet reported portion of the liability balances considers a variety of factors, including the frequency and severity of losses, changes in claim reporting and resolution patterns, insurance industry practices, the regulatory environment and legal precedent. The adequacy of the liabilities is regularly monitored based on evolving accident claim history and insurance related state legislation changes. If the Company’s estimates change or if actual results differ from these assumptions, the amount of the recorded liabilities are adjusted to reflect these results. Auditing self-insured liabilities is complex and required the involvement of our actuarial specialists due to the significant valuation uncertainty associated with the estimate, management’s application of complex judgments and the use of actuarial methods. In addition, the self-insured liabilities estimates are sensitive to management’s assumptions, including claim frequency, actuarial evaluations of historical claim experience and future projections of ultimate losses used in the computation of self-insured liabilities. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s self-insured liabilities process. For example, we tested controls over management’s review of the assumptions outlined above that are used in the self-insured liabilities calculation and the completeness and accuracy of the data underlying the self-insured liabilities. |
To test the valuation of the self-insured liabilities, we performed audit procedures that included involving our internal actuarial specialists to assist us in developing an independent estimate of liability and evaluating the methods used by management and the reasonableness of assumptions used in their models (e.g., actuarial evaluations of historical claim experience and future projections of ultimate losses). We compared the Company's reserve to the estimate of liability developed by our actuarial specialists based on the underlying claims data and independently selected assumptions. | ||||||||
Valuation of Indefinite-Lived Intangible Tradename Assets in the International Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | As disclosed in Note 5 to the consolidated financial statements, the Company’s indefinite-lived intangible tradename assets totaled $2.794 billion, with $600 million relating to indefinite-lived intangible tradename assets in the International RAC segment, as of December 31, 2021. As disclosed in Note 2 to the consolidated financial statements, indefinite-lived intangible assets are tested for impairment on an annual basis, as of October 1, and at interim periods when circumstances require as a result of a triggering event. Auditing the Company’s indefinite-lived intangible tradename assets in the International RAC segment was complex and highly judgmental due to the significant estimation required to determine its fair value as a result of the Company’s future projections, operating performance and the current industry and economic environment in which the Company operates. The Company’s estimate of fair value for the indefinite-lived intangible tradename assets in the International RAC segment required significant judgment to estimate the impact of changes in revenues and profitability, industry trends on future operating results and the future cash flows expected to be generated. In addition, the fair value estimate of these indefinite-lived intangible tradename assets in the International RAC segment was sensitive to significant assumptions such as projected revenues, royalty rates, terminal period revenue growth rates and the weighted average cost of capital. These significant assumptions are affected by expected future market or economic conditions, including the continuing impact of COVID-19 and the Chip Shortage as defined in the Company’s Form 10-K. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s indefinite-lived intangible tradename assets impairment review processes. For example, we tested controls over management’s review of the assumptions, including assumptions related to projected financial information, as outlined above that are used in the indefinite-lived intangible tradename assets impairment test. To test the estimated fair value of the International RAC segment’s indefinite-lived intangible tradename assets, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions and the completeness and accuracy of the underlying data used by the Company in its analyses. We compared the significant assumptions used by management to current industry and economic trends, expected changes to the Company’s business model, the Company’s historical results and other relevant factors. We assessed the historical accuracy of management’s estimates, including projected financial information, and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the International RAC segment indefinite-lived intangible tradename assets that would result from hypothetical changes in the assumptions. We also involved valuation specialists to assist in our evaluation of the Company’s model, valuation methodologies, and certain significant assumptions, such as the royalty rates, the terminal period revenue growth rates and the weighted average cost of capital. |
Calculation of Non-Program Depreciation on Revenue Earning Vehicles in the Americas Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | For the year ended December 31, 2021, total depreciation of revenue earning vehicles and lease charges in the Americas RAC segment was $343 million, including gains and losses on disposals. As discussed in Note 2 to the consolidated financial statements, depreciation rates are reviewed on a quarterly basis based on management’s ongoing assessment of present and estimated future market conditions, the effect of these conditions on residual values at the expected time of disposal and the estimated holding period for the revenue earning vehicles. The Company’s fleet is comprised of vehicles that are subject to and are not subject to vehicle repurchase programs (“program vehicles” and “non-program vehicles,” respectively). For program vehicles, the manufacturers guarantee a specified price or depreciation rate upon disposal, versus non-program vehicles where the Company estimates the residual value of the vehicle at the expected time of disposal. |
Auditing the Company’s calculation of depreciation for non-program vehicles related to the Americas RAC segment was complex due to the significant estimation uncertainty and management judgment to determine the estimated residual values at the expected time of disposal. The significant estimation uncertainty was primarily due to management’s assumptions of future consumer demand for vehicles within their current fleet, the disposal channel of those vehicles and other external market conditions. Additionally, auditing the calculation of depreciation was challenging due to the volume of data inputs utilized in management’s calculation, including historical sales data from multiple sources at varying levels of disaggregation along with additional data specific to the Company’s current fleet. | ||||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s measurement of depreciation expense for non-program vehicles related to the Americas RAC segment. For example, we tested controls over management’s quarterly review of the depreciation rates, which included their procedures to validate the completeness and accuracy of the data used in the calculation and their assessment of significant assumptions, specifically the estimated residual values of non-program vehicles related to the Americas RAC segment. To test the depreciation calculation for non-program vehicles, our audit procedures included, among others, testing the completeness and accuracy of the underlying data by comparing historical sales data and vehicle information used in the calculation (e.g., make, model, trim) to external sources and the Company’s records. We tested the base depreciation rate calculations performed within the IT application and evaluated the reasonableness of other significant assumptions such as resale market conditions, including consumer demand for specific vehicles, and disposition channels to assess the reasonableness of the residual value estimates made by management. Additionally, we performed analytical procedures to evaluate historical gains and losses recognized upon disposal in order to retrospectively review the reasonableness of management’s estimates. | |||||||
Valuation of Self-insured Liabilities | ||||||||
Description of the Matter | As disclosed in Notes 2 and 14 to the consolidated financial statements, the Company is self-insured for public liability, property damage, general liability, liability insurance supplement and worker's compensation. The Company records liabilities for these matters based on actuarial analyses of historical claim activity and estimates of both reported accident claims not yet paid and claims incurred but not yet reported. The estimated self-insured liabilities as of December 31, 2021 were $463 million. The actuarial analyses that determine the claims incurred but not yet reported portion of the liability balances considers a variety of factors, including the frequency and severity of losses, changes in claim reporting and resolution patterns, insurance industry practices, the regulatory environment and legal precedent. The adequacy of the liabilities is regularly monitored based on evolving accident claim history and insurance related state legislation changes. If the Company’s estimates change or if actual results differ from these assumptions, the amount of the recorded liabilities are adjusted to reflect these results. Auditing self-insured liabilities is complex and required the involvement of our actuarial specialists due to the significant valuation uncertainty associated with the estimate, management’s application of complex judgments and the use of actuarial methods. In addition, the self-insured liabilities estimates are sensitive to management’s assumptions, including claim frequency, actuarial evaluations of historical claim experience and future projections of ultimate losses used in the computation of self-insured liabilities. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s self-insured liabilities process. For example, we tested controls over management’s review of the assumptions outlined above that are used in the self-insured liabilities calculation and the completeness and accuracy of the data underlying the self-insured liabilities. |
To test the valuation of the self-insured liabilities, we performed audit procedures that included involving our internal actuarial specialists to assist us in developing an independent estimate of liability and evaluating the methods used by management and the reasonableness of assumptions used in their models (e.g., actuarial evaluations of historical claim experience and future projections of ultimate losses). We compared the Company's reserve to the estimate of liability developed by our actuarial specialists based on the underlying claims data and independently selected assumptions. | ||||||||
Valuation of Indefinite-Lived Intangible Tradename Assets in the International Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | As disclosed in Note 5 to the consolidated financial statements, the Company’s indefinite-lived intangible tradename assets totaled $2.794 billion, with $600 million relating to indefinite-lived intangible tradename assets in the International RAC segment, as of December 31, 2021. As disclosed in Note 2 to the consolidated financial statements, indefinite-lived intangible assets are tested for impairment on an annual basis, as of October 1, and at interim periods when circumstances require as a result of a triggering event. Auditing the Company’s indefinite-lived intangible tradename assets in the International RAC segment was complex and highly judgmental due to the significant estimation required to determine its fair value as a result of the Company’s future projections, operating performance and the current industry and economic environment in which the Company operates. The Company’s estimate of fair value for the indefinite-lived intangible tradename assets in the International RAC segment required significant judgment to estimate the impact of changes in revenues and profitability, industry trends on future operating results and the future cash flows expected to be generated. In addition, the fair value estimate of these indefinite-lived intangible tradename assets in the International RAC segment was sensitive to significant assumptions such as projected revenues, royalty rates, terminal period revenue growth rates and the weighted average cost of capital. These significant assumptions are affected by expected future market or economic conditions, including the continuing impact of COVID-19 and the Chip Shortage as defined in the Company’s Form 10-K. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s indefinite-lived intangible tradename assets impairment review processes. For example, we tested controls over management’s review of the assumptions, including assumptions related to projected financial information, as outlined above that are used in the indefinite-lived intangible tradename assets impairment test. To test the estimated fair value of the International RAC segment’s indefinite-lived intangible tradename assets, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions and the completeness and accuracy of the underlying data used by the Company in its analyses. We compared the significant assumptions used by management to current industry and economic trends, expected changes to the Company’s business model, the Company’s historical results and other relevant factors. We assessed the historical accuracy of management’s estimates, including projected financial information, and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the International RAC segment indefinite-lived intangible tradename assets that would result from hypothetical changes in the assumptions. We also involved valuation specialists to assist in our evaluation of the Company’s model, valuation methodologies, and certain significant assumptions, such as the royalty rates, the terminal period revenue growth rates and the weighted average cost of capital. |
December 31, 2021 | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 2,258 | $ | 1,096 | |||||||
Restricted cash and cash equivalents: | |||||||||||
Vehicle | 77 | 50 | |||||||||
Non-vehicle | 316 | 361 | |||||||||
Total restricted cash and cash equivalents | 393 | 411 | |||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 2,651 | 1,507 | |||||||||
Receivables: | |||||||||||
Vehicle | 62 | 164 | |||||||||
Non-vehicle, net of allowance of $48 and $46, respectively | 696 | 613 | |||||||||
Total receivables, net | 758 | 777 | |||||||||
Prepaid expenses and other assets | 1,017 | 373 | |||||||||
Revenue earning vehicles: | |||||||||||
Vehicles | 10,836 | 7,540 | |||||||||
Less: accumulated depreciation | (1,610) | (1,478) | |||||||||
Total revenue earning vehicles, net | 9,226 | 6,062 | |||||||||
Property and equipment, net | 608 | 666 | |||||||||
Operating lease right-of-use assets | 1,566 | 1,675 | |||||||||
Intangible assets, net | 2,912 | 2,992 | |||||||||
Goodwill | 1,045 | 1,045 | |||||||||
Assets held for sale | — | 1,811 | |||||||||
Total assets(1) | $ | 19,783 | $ | 16,908 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Accounts payable: | |||||||||||
Vehicle | $ | 56 | $ | 29 | |||||||
Non-vehicle | 516 | 389 | |||||||||
Total accounts payable | 572 | 418 | |||||||||
Accrued liabilities | 863 | 759 | |||||||||
Accrued taxes, net | 157 | 121 | |||||||||
Debt: | |||||||||||
Vehicle | 7,921 | 6,024 | |||||||||
Non-vehicle | 2,986 | 243 | |||||||||
Total debt | 10,907 | 6,267 | |||||||||
Public Warrants | 1,324 | — | |||||||||
Operating lease liabilities | 1,510 | 1,636 | |||||||||
Self-insured liabilities | 463 | 488 | |||||||||
Deferred income taxes, net | 1,010 | 730 | |||||||||
Total liabilities not subject to compromise | 16,806 | 10,419 | |||||||||
Liabilities subject to compromise | — | 4,965 | |||||||||
Liabilities held for sale | — | 1,431 | |||||||||
Total liabilities(1) | 16,806 | 16,815 | |||||||||
Commitments and contingencies | 0 | 0 | |||||||||
Stockholders' equity: | |||||||||||
Preferred stock, $0.01 par value, no shares issued and outstanding | — | — | |||||||||
Common stock, $0.01 par value, 477,233,278 and 158,235,410 shares issued, respectively, and 449,782,424 and 156,206,478 shares outstanding, respectively | 5 | 2 | |||||||||
Treasury stock, at cost, 27,450,854 and 2,028,932 common shares, respectively | (708) | (100) | |||||||||
Additional paid-in capital | 6,209 | 3,047 | |||||||||
Retained earnings (Accumulated deficit) | (2,315) | (2,681) | |||||||||
Accumulated other comprehensive income (loss) | (214) | (212) | |||||||||
Stockholders' equity attributable to Hertz Global | 2,977 | 56 | |||||||||
Noncontrolling interests | — | 37 | |||||||||
Total stockholders' equity | 2,977 | 93 | |||||||||
Total liabilities and stockholders' equity | $ | 19,783 | $ | 16,908 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 | |||||||||||
Expenses: | |||||||||||||||||
Direct vehicle and operating | 3,920 | 3,423 | 5,305 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 497 | 2,030 | 2,563 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Selling, general and administrative | 688 | 645 | 949 | ||||||||||||||
Interest expense, net: | |||||||||||||||||
Vehicle | 284 | 455 | 494 | ||||||||||||||
Non-vehicle (excludes contractual interest of $129 million for the year ended December 31, 2020) | 185 | 153 | 311 | ||||||||||||||
Total interest expense, net | 469 | 608 | 805 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Other (income) expense, net | (21) | (9) | (59) | ||||||||||||||
Reorganization items, net | 677 | 175 | — | ||||||||||||||
(Gain) from the sale of a business | (400) | — | — | ||||||||||||||
Change in fair value of Public Warrants | 627 | — | — | ||||||||||||||
Total expenses | 6,653 | 7,310 | 9,766 | ||||||||||||||
Income (loss) before income taxes | 683 | (2,052) | 13 | ||||||||||||||
Income tax (provision) benefit | (318) | 329 | (63) | ||||||||||||||
Net income (loss) | 365 | (1,723) | (50) | ||||||||||||||
Net (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Net income (loss) attributable to Hertz Global | 366 | (1,714) | (58) | ||||||||||||||
Series A Preferred Stock deemed dividends | (450) | — | — | ||||||||||||||
Net income (loss) available to Hertz Global common stockholders | $ | (84) | $ | (1,714) | $ | (58) | |||||||||||
Weighted-average common shares outstanding: | |||||||||||||||||
Basic | 315 | 150 | 117 | ||||||||||||||
Diluted | 315 | 150 | 117 | ||||||||||||||
Earnings (loss) per common share: | |||||||||||||||||
Basic | $ | (0.27) | $ | (11.44) | $ | (0.49) | |||||||||||
Diluted | $ | (0.27) | $ | (11.44) | $ | (0.49) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net income (loss) | $ | 365 | $ | (1,723) | $ | (50) | |||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Foreign currency translation adjustments | (36) | (19) | 6 | ||||||||||||||
Net gain (loss) on pension and postretirement benefit plans | 25 | (11) | (11) | ||||||||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial net losses | 15 | 13 | 11 | ||||||||||||||
Total other comprehensive income (loss) before income taxes | 4 | (17) | 6 | ||||||||||||||
Income tax (provision) benefit related to pension and postretirement benefit plans | (3) | (4) | (1) | ||||||||||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on pension and postretirement benefit plans | (3) | (2) | (2) | ||||||||||||||
Total other comprehensive income (loss) | (2) | (23) | 3 | ||||||||||||||
Total comprehensive income (loss) | 363 | (1,746) | (47) | ||||||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Comprehensive income (loss) attributable to Hertz Global | $ | 364 | $ | (1,737) | $ | (55) |
Mezzanine Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock Shares | Preferred Stock Amount | Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock Shares | Treasury Stock Amount | Stockholders' Equity Attributable to Hertz Global | Non- controlling Interests | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2018 | — | $ | — | 84 | $ | 1 | $ | 2,261 | $ | (909) | $ | (192) | 2 | $ | (100) | $ | 1,061 | $ | 59 | $ | 1,120 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | (58) | — | — | — | (58) | 8 | (50) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | 3 | — | — | 3 | — | 3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | — | (3) | — | — | — | — | (3) | — | (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | 18 | — | — | — | — | 18 | — | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 Rights Offering, net | — | — | 58 | — | 748 | — | — | — | — | 748 | — | 748 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | — | — | — | 52 | 52 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | — | — | 142 | 1 | 3,024 | (967) | (189) | 2 | (100) | 1,769 | 119 | 1,888 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | (1,714) | — | — | — | (1,714) | (9) | (1,723) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | (23) | — | — | (23) | — | (23) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | — | (3) | — | — | — | — | (3) | — | (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | (2) | — | — | — | — | (2) | — | (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ATM Program, net | — | — | 14 | 1 | 28 | — | — | — | — | 29 | — | 29 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests, net | — | — | — | — | — | — | — | — | — | — | (73) | (73) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2020 | — | — | 156 | 2 | 3,047 | (2,681) | (212) | 2 | (100) | 56 | 37 | 93 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | 366 | — | — | — | 366 | (1) | 365 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | (2) | — | — | (2) | — | (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | 10 | — | — | — | — | 10 | — | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cancellation of stock-based awards | — | — | — | — | (10) | — | — | — | — | (10) | — | (10) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cancellation of common and treasury shares in exchange for new common shares | — | — | (142) | (2) | (98) | — | — | (2) | 100 | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common stockholders | — | — | — | — | (239) | — | — | — | — | (239) | — | (239) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from Plan Sponsors | — | — | 277 | 3 | 2,778 | — | — | — | — | 2,781 | — | 2,781 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 Rights Offering, net | — | — | 181 | 2 | 1,800 | — | — | — | — | 1,802 | — | 1,802 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Public Warrant issuance | — | — | — | — | (800) | — | — | — | — | (800) | — | (800) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock issuance, net | 2 | 1,433 | — | — | — | — | — | — | — | 1,433 | — | 1,433 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of preferred stock, net | (2) | (1,433) | — | — | (450) | — | — | — | — | (1,883) | — | (1,883) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Public Warrant exercises(1) | — | — | 5 | — | 180 | — | — | — | — | 180 | — | 180 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nasdaq listing and share repurchases(2) | — | — | (27) | — | (9) | — | — | 27 | (708) | (717) | — | (717) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests(3) | — | — | — | — | — | — | — | — | — | — | (36) | (36) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | — | $ | — | 450 | $ | 5 | $ | 6,209 | $ | (2,315) | $ | (214) | 27 | $ | (708) | $ | 2,977 | $ | — | $ | 2,977 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 365 | $ | (1,723) | $ | (50) | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and reserves for revenue earning vehicles | 600 | 2,259 | 2,791 | ||||||||||||||
Depreciation and amortization, non-vehicle | 196 | 225 | 203 | ||||||||||||||
Amortization of deferred financing costs and debt discount (premium) | 122 | 59 | 52 | ||||||||||||||
Loss on extinguishment of debt | 8 | 5 | 43 | ||||||||||||||
Stock-based compensation charges | 10 | (2) | 18 | ||||||||||||||
Provision for receivables allowance | 125 | 94 | 53 | ||||||||||||||
Deferred income taxes, net | 270 | (353) | 27 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Reorganization items, net | 314 | 8 | — | ||||||||||||||
(Gain) loss from the sale of a business | (400) | — | — | ||||||||||||||
(Gain) loss on marketable securities | — | — | (30) | ||||||||||||||
(Gain) loss on sale of non-vehicle capital assets | (8) | (24) | (39) | ||||||||||||||
Change in fair value of Public Warrants | 627 | — | — | ||||||||||||||
Other | (5) | 5 | (9) | ||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||
Non-vehicle receivables | (210) | 195 | (88) | ||||||||||||||
Prepaid expenses and other assets | (20) | 92 | (8) | ||||||||||||||
Operating lease right-of-use assets | 274 | 366 | 402 | ||||||||||||||
Non-vehicle accounts payable | (70) | 98 | 65 | ||||||||||||||
Accrued liabilities | (108) | (61) | (98) | ||||||||||||||
Accrued taxes, net | 24 | (52) | 14 | ||||||||||||||
Operating lease liabilities | (291) | (375) | (428) | ||||||||||||||
Self-insured liabilities | (17) | (76) | (18) | ||||||||||||||
Net cash provided by (used in) operating activities | 1,806 | 953 | 2,900 | ||||||||||||||
Cash flows from investing activities: | |||||||||||||||||
Revenue earning vehicles expenditures | (7,154) | (5,542) | (13,714) | ||||||||||||||
Proceeds from disposal of revenue earning vehicles | 2,818 | 10,098 | 9,486 | ||||||||||||||
Non-vehicle capital asset expenditures | (71) | (98) | (224) | ||||||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 16 | 60 | 27 | ||||||||||||||
Sales of marketable securities | — | 74 | — | ||||||||||||||
Collateral payments | (303) | — | — | ||||||||||||||
Collateral returned in exchange for letters of credit | 280 | — | — | ||||||||||||||
Proceeds from the sale of a business, net of cash sold | 871 | — | — | ||||||||||||||
Other | (1) | (1) | — | ||||||||||||||
Net cash provided by (used in) investing activities | (3,544) | 4,591 | (4,425) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from issuance of vehicle debt | 14,323 | 4,546 | 13,013 | ||||||||||||||
Repayments of vehicle debt | (12,607) | (10,751) | (11,530) | ||||||||||||||
Proceeds from issuance of non-vehicle debt | 4,644 | 1,812 | 3,016 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Repayments of non-vehicle debt | (6,352) | (855) | (3,732) | ||||||||||||||
Payment of financing costs | (185) | (75) | (53) | ||||||||||||||
Proceeds from Plan Sponsors | 2,781 | — | — | ||||||||||||||
Early redemption premium payment | (85) | — | (34) | ||||||||||||||
Proceeds from issuance of common stock, net | — | 28 | — | ||||||||||||||
Proceeds from exercises of Public Warrants | 77 | — | — | ||||||||||||||
Proceeds from the issuance of preferred stock, net | 1,433 | — | — | ||||||||||||||
Distributions to common stockholders | (239) | — | — | ||||||||||||||
Contributions from (distributions to) noncontrolling interests | (38) | (75) | 49 | ||||||||||||||
Proceeds from rights offerings, net | 1,639 | — | 748 | ||||||||||||||
Share repurchases | (654) | — | — | ||||||||||||||
Repurchase of preferred stock | (1,883) | — | — | ||||||||||||||
Payments for Nasdaq listing costs | (9) | — | — | ||||||||||||||
Other | — | (2) | (3) | ||||||||||||||
Net cash provided by (used in) financing activities | 2,845 | (5,372) | 1,474 | ||||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | (34) | 46 | 1 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | 1,073 | 218 | (50) | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period(1) | 1,578 | 1,360 | 1,410 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period(1) | $ | 2,651 | $ | 1,578 | $ | 1,360 | |||||||||||
Supplemental disclosures of cash flow information: | |||||||||||||||||
Cash paid during the period for: | |||||||||||||||||
Interest, net of amounts capitalized: | |||||||||||||||||
Vehicle | $ | 257 | $ | 335 | $ | 431 | |||||||||||
Non-vehicle | 198 | 109 | 272 | ||||||||||||||
Income taxes, net of refunds | 40 | (11) | 21 | ||||||||||||||
Operating lease liabilities | 472 | 546 | 575 | ||||||||||||||
Supplemental disclosures of non-cash information: | |||||||||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 27 | $ | 9 | $ | 165 | |||||||||||
Sales of revenue earning vehicles included in vehicle receivables | 33 | 144 | 667 | ||||||||||||||
Fleet payables included in liabilities subject to compromise | — | 2 | — | ||||||||||||||
Purchases of non-vehicle capital assets included in accounts payable | 24 | 7 | 40 | ||||||||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital leases | 79 | 32 | 23 | ||||||||||||||
Purchases of non-vehicle capital assets included in liabilities subject to compromise | — | 18 | — | ||||||||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 177 | 152 | 680 | ||||||||||||||
Public Warrant issuance | 800 | — | — | ||||||||||||||
Public Warrant exercises | 103 | — | — | ||||||||||||||
Backstop equity issuance | 164 | — | — | ||||||||||||||
Accrual for purchases of treasury shares | 54 | — | — |
December 31, 2021 | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 2,257 | $ | 1,096 | |||||||
Restricted cash and cash equivalents: | |||||||||||
Vehicle | 77 | 50 | |||||||||
Non-vehicle | 316 | 333 | |||||||||
Total restricted cash and cash equivalents | 393 | 383 | |||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 2,650 | 1,479 | |||||||||
Receivables: | |||||||||||
Vehicle | 62 | 164 | |||||||||
Non-vehicle, net of allowance of $48 and $46, respectively | 695 | 613 | |||||||||
Total receivables, net | 757 | 777 | |||||||||
Due from Hertz Holdings | — | 1 | |||||||||
Prepaid expenses and other assets | 1,016 | 372 | |||||||||
Revenue earning vehicles: | |||||||||||
Vehicles | 10,836 | 7,540 | |||||||||
Less: accumulated depreciation | (1,610) | (1,478) | |||||||||
Total revenue earning vehicles, net | 9,226 | 6,062 | |||||||||
Property and equipment, net | 608 | 666 | |||||||||
Operating lease right-of-use assets | 1,566 | 1,675 | |||||||||
Intangible assets, net | 2,912 | 2,992 | |||||||||
Goodwill | 1,045 | 1,045 | |||||||||
Assets held for sale | — | 1,811 | |||||||||
Total assets(1) | $ | 19,780 | $ | 16,880 | |||||||
LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT) | |||||||||||
Accounts payable: | |||||||||||
Vehicle | $ | 56 | $ | 29 | |||||||
Non-vehicle | 516 | 389 | |||||||||
Total accounts payable | 572 | 418 | |||||||||
Accrued liabilities | 809 | 759 | |||||||||
Accrued taxes, net | 157 | 121 | |||||||||
Debt: | |||||||||||
Vehicle | 7,921 | 6,024 | |||||||||
Non-vehicle | 2,986 | 243 | |||||||||
Total debt | 10,907 | 6,267 | |||||||||
Operating lease liabilities | 1,510 | 1,636 | |||||||||
Self-insured liabilities | 463 | 488 | |||||||||
Deferred income taxes, net | 1,012 | 735 | |||||||||
Total liabilities not subject to compromise | 15,430 | 10,424 | |||||||||
Liabilities subject to compromise | — | 5,030 | |||||||||
Liabilities held for sale | — | 1,431 | |||||||||
Total liabilities(1) | 15,430 | 16,885 | |||||||||
Commitments and contingencies | 0 | 0 | |||||||||
Stockholder's equity (deficit): | |||||||||||
Common stock, $0.01 par value, 3,000 shares authorized and 100 shares issued and outstanding | — | — | |||||||||
Additional paid-in capital | 7,190 | 3,953 | |||||||||
Retained earnings (Accumulated deficit) | (2,626) | (3,783) | |||||||||
Accumulated other comprehensive income (loss) | (214) | (212) | |||||||||
Stockholder's equity (deficit) attributable to Hertz | 4,350 | (42) | |||||||||
Noncontrolling interests | — | 37 | |||||||||
Total stockholder's equity (deficit) | 4,350 | (5) | |||||||||
Total liabilities and stockholder's equity (deficit) | $ | 19,780 | $ | 16,880 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 | |||||||||||
Expenses: | |||||||||||||||||
Direct vehicle and operating | 3,920 | 3,423 | 5,305 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 497 | 2,030 | 2,563 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Selling, general and administrative | 688 | 645 | 949 | ||||||||||||||
Interest expense, net: | |||||||||||||||||
Vehicle | 284 | 455 | 494 | ||||||||||||||
Non-vehicle (excludes contractual interest of $129 million for the year ended December 31, 2020) | 185 | 151 | 304 | ||||||||||||||
Total interest expense, net | 469 | 606 | 798 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Write-off of intercompany loan | — | 133 | — | ||||||||||||||
Other (income) expense, net | (21) | (9) | (59) | ||||||||||||||
Reorganization items, net | 513 | 175 | — | ||||||||||||||
(Gain) from the sale of a business | (400) | — | — | ||||||||||||||
Total expenses | 5,862 | 7,441 | 9,759 | ||||||||||||||
Income (loss) before income taxes | 1,474 | (2,183) | 20 | ||||||||||||||
Income tax (provision) benefit | (318) | 328 | (65) | ||||||||||||||
Net income (loss) | 1,156 | (1,855) | (45) | ||||||||||||||
Net (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Net income (loss) attributable to Hertz | $ | 1,157 | $ | (1,846) | $ | (53) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net income (loss) | $ | 1,156 | $ | (1,855) | $ | (45) | |||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Foreign currency translation adjustments | (36) | (19) | 6 | ||||||||||||||
Net gain (loss) on pension and postretirement benefit plans | 25 | (11) | (11) | ||||||||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial net losses | 15 | 13 | 11 | ||||||||||||||
Total other comprehensive income (loss) before income taxes | 4 | (17) | 6 | ||||||||||||||
Income tax (provision) benefit related to pension and postretirement benefit plans | (3) | (4) | (1) | ||||||||||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on pension and postretirement benefit plans | (3) | (2) | (2) | ||||||||||||||
Total other comprehensive income (loss) | (2) | (23) | 3 | ||||||||||||||
Total comprehensive income (loss) | 1,154 | (1,878) | (42) | ||||||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Comprehensive income (loss) attributable to Hertz | $ | 1,155 | $ | (1,869) | $ | (50) |
Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Due From Affiliate | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Stockholder's Equity (Deficit) Attributable to Hertz | Noncontrolling Interests | Total Stockholder's Equity (Deficit) | |||||||||||||||||||||||||||||||||||||||||||||
Balance as of: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2018 | 100 | — | 3,187 | (52) | (1,884) | (192) | 1,059 | 59 | 1,118 | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (53) | — | (53) | 8 | (45) | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | 3 | 3 | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (12) | — | — | (12) | — | (12) | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | 18 | — | — | — | 18 | — | 18 | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from Hertz Holdings | — | — | 750 | — | — | — | 750 | — | 750 | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | 52 | 52 | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | 100 | — | 3,955 | (64) | (1,937) | (189) | 1,765 | 119 | 1,884 | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (1,846) | — | (1,846) | (9) | (1,855) | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (23) | (23) | — | (23) | ||||||||||||||||||||||||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (4) | — | — | (4) | — | (4) | ||||||||||||||||||||||||||||||||||||||||||||
Liabilities subject to compromise(1) | — | — | — | (65) | — | — | (65) | — | (65) | ||||||||||||||||||||||||||||||||||||||||||||
Write-off of intercompany loan(1) | — | — | — | 133 | — | — | 133 | — | 133 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | (2) | — | — | — | (2) | — | (2) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests, net | — | — | — | — | — | — | — | (73) | (73) | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2020 | 100 | — | 3,953 | — | (3,783) | (212) | (42) | 37 | (5) | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | 1,157 | — | 1,157 | (1) | 1,156 | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (2) | (2) | — | (2) | ||||||||||||||||||||||||||||||||||||||||||||
Non-cash distribution(1) | — | — | 65 | — | — | — | 65 | — | 65 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | 10 | — | — | — | 10 | — | 10 | ||||||||||||||||||||||||||||||||||||||||||||
Cancellation of stock-based awards | — | — | (10) | — | — | — | (10) | — | (10) | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from Hertz Holdings | — | — | 5,642 | — | — | — | 5,642 | — | 5,642 | ||||||||||||||||||||||||||||||||||||||||||||
Dividends to Hertz Holdings | — | — | (2,470) | — | — | — | (2,470) | — | (2,470) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests(2) | — | — | — | — | — | — | — | (36) | (36) | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | 100 | $ | — | $ | 7,190 | $ | — | $ | (2,626) | $ | (214) | $ | 4,350 | $ | — | $ | 4,350 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 1,156 | $ | (1,855) | $ | (45) | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and reserves for revenue earning vehicles | 600 | 2,259 | 2,791 | ||||||||||||||
Depreciation and amortization, non-vehicle | 196 | 225 | 203 | ||||||||||||||
Amortization of deferred financing costs and debt discount (premium) | 122 | 59 | 52 | ||||||||||||||
Loss on extinguishment of debt | 8 | 5 | 43 | ||||||||||||||
Stock-based compensation charges | 10 | (2) | 18 | ||||||||||||||
Provision for receivables allowance | 125 | 94 | 53 | ||||||||||||||
Deferred income taxes, net | 270 | (353) | 28 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Write-off of intercompany loan | — | 133 | — | ||||||||||||||
Reorganization items, net | 150 | 8 | — | ||||||||||||||
(Gain) loss from the sale of a business | (400) | — | — | ||||||||||||||
(Gain) loss on marketable securities | — | — | (30) | ||||||||||||||
(Gain) loss on sale of non-vehicle capital assets | (8) | (24) | (39) | ||||||||||||||
Other | (5) | 5 | (8) | ||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||
Non-vehicle receivables | (210) | 195 | (88) | ||||||||||||||
Prepaid expenses and other assets | (20) | 94 | (8) | ||||||||||||||
Operating lease right-of-use assets | 274 | 366 | 402 | ||||||||||||||
Non-vehicle accounts payable | (70) | 98 | 65 | ||||||||||||||
Accrued liabilities | (108) | (61) | (98) | ||||||||||||||
Accrued taxes, net | 24 | (52) | 14 | ||||||||||||||
Operating lease liabilities | (291) | (375) | (428) | ||||||||||||||
Self-insured liabilities | (17) | (76) | (18) | ||||||||||||||
Net cash provided by (used in) operating activities | 1,806 | 956 | 2,907 | ||||||||||||||
Cash flows from investing activities: | |||||||||||||||||
Revenue earning vehicles expenditures | (7,154) | (5,542) | (13,714) | ||||||||||||||
Proceeds from disposal of revenue earning vehicles | 2,818 | 10,098 | 9,486 | ||||||||||||||
Non-vehicle capital asset expenditures | (71) | (98) | (224) | ||||||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 16 | 60 | 27 | ||||||||||||||
Sales of marketable securities | — | 74 | — | ||||||||||||||
Collateral payments | (303) | — | — | ||||||||||||||
Collateral returned in exchange for letters of credit | 280 | — | — | ||||||||||||||
Proceeds from the sale of a business, net of cash sold | 871 | — | — | ||||||||||||||
Other | (1) | (1) | — | ||||||||||||||
Net cash provided by (used in) investing activities | (3,544) | 4,591 | (4,425) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from issuance of vehicle debt | 14,323 | 4,546 | 13,013 | ||||||||||||||
Repayments of vehicle debt | (12,607) | (10,751) | (11,530) | ||||||||||||||
Proceeds from issuance of non-vehicle debt | 4,644 | 1,812 | 3,016 | ||||||||||||||
Repayments of non-vehicle debt | (6,352) | (855) | (3,732) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Payment of financing costs | (185) | (75) | (53) | ||||||||||||||
Early redemption premium payment | (85) | — | (34) | ||||||||||||||
Advances to Hertz Holdings | — | (5) | (12) | ||||||||||||||
Contributions from (distributions to) noncontrolling interests | (38) | (75) | 49 | ||||||||||||||
Dividends paid to Hertz Holdings | (2,470) | — | — | ||||||||||||||
Contributions from Hertz Holdings | 5,642 | — | 750 | ||||||||||||||
Net cash provided by (used in) financing activities | 2,872 | (5,403) | 1,467 | ||||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | (34) | 46 | 1 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | 1,100 | 190 | (50) | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period(1) | 1,550 | 1,360 | 1,410 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period (1) | $ | 2,650 | $ | 1,550 | $ | 1,360 | |||||||||||
Supplemental disclosures of cash flow information: | |||||||||||||||||
Cash paid during the period for: | |||||||||||||||||
Interest, net of amounts capitalized: | |||||||||||||||||
Vehicle | $ | 257 | $ | 335 | $ | 431 | |||||||||||
Non-vehicle | 198 | 109 | 272 | ||||||||||||||
Income taxes, net of refunds | 40 | (11) | 21 | ||||||||||||||
Operating lease liabilities | 472 | 546 | 575 | ||||||||||||||
Supplemental disclosures of non-cash information: | |||||||||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 27 | $ | 9 | $ | 165 | |||||||||||
Sales of revenue earning vehicles included in vehicle receivables | 33 | 144 | 667 | ||||||||||||||
Fleet payables included in liabilities subject to compromise | — | 2 | — | ||||||||||||||
Purchases of non-vehicle capital assets included in accounts payable | 24 | 7 | 40 | ||||||||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital leases | 79 | 32 | 23 | ||||||||||||||
Purchases of non-vehicle capital assets included in liabilities subject to compromise | — | 18 | — | ||||||||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 177 | 152 | 680 | ||||||||||||||
Non-cash capital contribution from Hertz Holdings | 65 | — | — |
Page | ||||||||
Hertz Global Holdings, Inc. and Subsidiaries | ||||||||
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42) | ||||||||
The Hertz Corporation and Subsidiaries | ||||||||
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42) | ||||||||
Notes to the Consolidated Financial Statements | ||||||||
Schedule I | ||||||||
Schedule II | ||||||||
Calculation of Non-Program Depreciation on Revenue Earning Vehicles in the Americas Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | For the year ended December 31, 2021, total depreciation of revenue earning vehicles and lease charges in the Americas RAC segment was $343 million, including gains and losses on disposals. As discussed in Note 2 to the consolidated financial statements, depreciation rates are reviewed on a quarterly basis based on management’s ongoing assessment of present and estimated future market conditions, the effect of these conditions on residual values at the expected time of disposal and the estimated holding period for the revenue earning vehicles. The Company’s fleet is comprised of vehicles that are subject to and are not subject to vehicle repurchase programs (“program vehicles” and “non-program vehicles,” respectively). For program vehicles, the manufacturers guarantee a specified price or depreciation rate upon disposal, versus non-program vehicles where the Company estimates the residual value of the vehicle at the expected time of disposal. |
Auditing the Company’s calculation of depreciation for non-program vehicles related to the Americas RAC segment was complex due to the significant estimation uncertainty and management judgment to determine the estimated residual values at the expected time of disposal. The significant estimation uncertainty was primarily due to management’s assumptions of future consumer demand for vehicles within their current fleet, the disposal channel of those vehicles and other external market conditions. Additionally, auditing the calculation of depreciation was challenging due to the volume of data inputs utilized in management’s calculation, including historical sales data from multiple sources at varying levels of disaggregation along with additional data specific to the Company’s current fleet. | ||||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s measurement of depreciation expense for non-program vehicles related to the Americas RAC segment. For example, we tested controls over management’s quarterly review of the depreciation rates, which included their procedures to validate the completeness and accuracy of the data used in the calculation and their assessment of significant assumptions, specifically the estimated residual values of non-program vehicles related to the Americas RAC segment. To test the depreciation calculation for non-program vehicles, our audit procedures included, among others, testing the completeness and accuracy of the underlying data by comparing historical sales data and vehicle information used in the calculation (e.g., make, model, trim) to external sources and the Company’s records. We tested the base depreciation rate calculations performed within the IT application and evaluated the reasonableness of other significant assumptions such as resale market conditions, including consumer demand for specific vehicles, and disposition channels to assess the reasonableness of the residual value estimates made by management. Additionally, we performed analytical procedures to evaluate historical gains and losses recognized upon disposal in order to retrospectively review the reasonableness of management’s estimates. | |||||||
Valuation of Self-insured Liabilities | ||||||||
Description of the Matter | As disclosed in Notes 2 and 14 to the consolidated financial statements, the Company is self-insured for public liability, property damage, general liability, liability insurance supplement and worker's compensation. The Company records liabilities for these matters based on actuarial analyses of historical claim activity and estimates of both reported accident claims not yet paid and claims incurred but not yet reported. The estimated self-insured liabilities as of December 31, 2021 were $463 million. The actuarial analyses that determine the claims incurred but not yet reported portion of the liability balances considers a variety of factors, including the frequency and severity of losses, changes in claim reporting and resolution patterns, insurance industry practices, the regulatory environment and legal precedent. The adequacy of the liabilities is regularly monitored based on evolving accident claim history and insurance related state legislation changes. If the Company’s estimates change or if actual results differ from these assumptions, the amount of the recorded liabilities are adjusted to reflect these results. Auditing self-insured liabilities is complex and required the involvement of our actuarial specialists due to the significant valuation uncertainty associated with the estimate, management’s application of complex judgments and the use of actuarial methods. In addition, the self-insured liabilities estimates are sensitive to management’s assumptions, including claim frequency, actuarial evaluations of historical claim experience and future projections of ultimate losses used in the computation of self-insured liabilities. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s self-insured liabilities process. For example, we tested controls over management’s review of the assumptions outlined above that are used in the self-insured liabilities calculation and the completeness and accuracy of the data underlying the self-insured liabilities. |
To test the valuation of the self-insured liabilities, we performed audit procedures that included involving our internal actuarial specialists to assist us in developing an independent estimate of liability and evaluating the methods used by management and the reasonableness of assumptions used in their models (e.g., actuarial evaluations of historical claim experience and future projections of ultimate losses). We compared the Company's reserve to the estimate of liability developed by our actuarial specialists based on the underlying claims data and independently selected assumptions. | ||||||||
Valuation of Indefinite-Lived Intangible Tradename Assets in the International Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | As disclosed in Note 5 to the consolidated financial statements, the Company’s indefinite-lived intangible tradename assets totaled $2.794 billion, with $600 million relating to indefinite-lived intangible tradename assets in the International RAC segment, as of December 31, 2021. As disclosed in Note 2 to the consolidated financial statements, indefinite-lived intangible assets are tested for impairment on an annual basis, as of October 1, and at interim periods when circumstances require as a result of a triggering event. Auditing the Company’s indefinite-lived intangible tradename assets in the International RAC segment was complex and highly judgmental due to the significant estimation required to determine its fair value as a result of the Company’s future projections, operating performance and the current industry and economic environment in which the Company operates. The Company’s estimate of fair value for the indefinite-lived intangible tradename assets in the International RAC segment required significant judgment to estimate the impact of changes in revenues and profitability, industry trends on future operating results and the future cash flows expected to be generated. In addition, the fair value estimate of these indefinite-lived intangible tradename assets in the International RAC segment was sensitive to significant assumptions such as projected revenues, royalty rates, terminal period revenue growth rates and the weighted average cost of capital. These significant assumptions are affected by expected future market or economic conditions, including the continuing impact of COVID-19 and the Chip Shortage as defined in the Company’s Form 10-K. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s indefinite-lived intangible tradename assets impairment review processes. For example, we tested controls over management’s review of the assumptions, including assumptions related to projected financial information, as outlined above that are used in the indefinite-lived intangible tradename assets impairment test. To test the estimated fair value of the International RAC segment’s indefinite-lived intangible tradename assets, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions and the completeness and accuracy of the underlying data used by the Company in its analyses. We compared the significant assumptions used by management to current industry and economic trends, expected changes to the Company’s business model, the Company’s historical results and other relevant factors. We assessed the historical accuracy of management’s estimates, including projected financial information, and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the International RAC segment indefinite-lived intangible tradename assets that would result from hypothetical changes in the assumptions. We also involved valuation specialists to assist in our evaluation of the Company’s model, valuation methodologies, and certain significant assumptions, such as the royalty rates, the terminal period revenue growth rates and the weighted average cost of capital. |
Calculation of Non-Program Depreciation on Revenue Earning Vehicles in the Americas Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | For the year ended December 31, 2021, total depreciation of revenue earning vehicles and lease charges in the Americas RAC segment was $343 million, including gains and losses on disposals. As discussed in Note 2 to the consolidated financial statements, depreciation rates are reviewed on a quarterly basis based on management’s ongoing assessment of present and estimated future market conditions, the effect of these conditions on residual values at the expected time of disposal and the estimated holding period for the revenue earning vehicles. The Company’s fleet is comprised of vehicles that are subject to and are not subject to vehicle repurchase programs (“program vehicles” and “non-program vehicles,” respectively). For program vehicles, the manufacturers guarantee a specified price or depreciation rate upon disposal, versus non-program vehicles where the Company estimates the residual value of the vehicle at the expected time of disposal. |
Auditing the Company’s calculation of depreciation for non-program vehicles related to the Americas RAC segment was complex due to the significant estimation uncertainty and management judgment to determine the estimated residual values at the expected time of disposal. The significant estimation uncertainty was primarily due to management’s assumptions of future consumer demand for vehicles within their current fleet, the disposal channel of those vehicles and other external market conditions. Additionally, auditing the calculation of depreciation was challenging due to the volume of data inputs utilized in management’s calculation, including historical sales data from multiple sources at varying levels of disaggregation along with additional data specific to the Company’s current fleet. | ||||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s measurement of depreciation expense for non-program vehicles related to the Americas RAC segment. For example, we tested controls over management’s quarterly review of the depreciation rates, which included their procedures to validate the completeness and accuracy of the data used in the calculation and their assessment of significant assumptions, specifically the estimated residual values of non-program vehicles related to the Americas RAC segment. To test the depreciation calculation for non-program vehicles, our audit procedures included, among others, testing the completeness and accuracy of the underlying data by comparing historical sales data and vehicle information used in the calculation (e.g., make, model, trim) to external sources and the Company’s records. We tested the base depreciation rate calculations performed within the IT application and evaluated the reasonableness of other significant assumptions such as resale market conditions, including consumer demand for specific vehicles, and disposition channels to assess the reasonableness of the residual value estimates made by management. Additionally, we performed analytical procedures to evaluate historical gains and losses recognized upon disposal in order to retrospectively review the reasonableness of management’s estimates. | |||||||
Valuation of Self-insured Liabilities | ||||||||
Description of the Matter | As disclosed in Notes 2 and 14 to the consolidated financial statements, the Company is self-insured for public liability, property damage, general liability, liability insurance supplement and worker's compensation. The Company records liabilities for these matters based on actuarial analyses of historical claim activity and estimates of both reported accident claims not yet paid and claims incurred but not yet reported. The estimated self-insured liabilities as of December 31, 2021 were $463 million. The actuarial analyses that determine the claims incurred but not yet reported portion of the liability balances considers a variety of factors, including the frequency and severity of losses, changes in claim reporting and resolution patterns, insurance industry practices, the regulatory environment and legal precedent. The adequacy of the liabilities is regularly monitored based on evolving accident claim history and insurance related state legislation changes. If the Company’s estimates change or if actual results differ from these assumptions, the amount of the recorded liabilities are adjusted to reflect these results. Auditing self-insured liabilities is complex and required the involvement of our actuarial specialists due to the significant valuation uncertainty associated with the estimate, management’s application of complex judgments and the use of actuarial methods. In addition, the self-insured liabilities estimates are sensitive to management’s assumptions, including claim frequency, actuarial evaluations of historical claim experience and future projections of ultimate losses used in the computation of self-insured liabilities. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s self-insured liabilities process. For example, we tested controls over management’s review of the assumptions outlined above that are used in the self-insured liabilities calculation and the completeness and accuracy of the data underlying the self-insured liabilities. |
To test the valuation of the self-insured liabilities, we performed audit procedures that included involving our internal actuarial specialists to assist us in developing an independent estimate of liability and evaluating the methods used by management and the reasonableness of assumptions used in their models (e.g., actuarial evaluations of historical claim experience and future projections of ultimate losses). We compared the Company's reserve to the estimate of liability developed by our actuarial specialists based on the underlying claims data and independently selected assumptions. | ||||||||
Valuation of Indefinite-Lived Intangible Tradename Assets in the International Rental Car (“RAC”) Segment | ||||||||
Description of the Matter | As disclosed in Note 5 to the consolidated financial statements, the Company’s indefinite-lived intangible tradename assets totaled $2.794 billion, with $600 million relating to indefinite-lived intangible tradename assets in the International RAC segment, as of December 31, 2021. As disclosed in Note 2 to the consolidated financial statements, indefinite-lived intangible assets are tested for impairment on an annual basis, as of October 1, and at interim periods when circumstances require as a result of a triggering event. Auditing the Company’s indefinite-lived intangible tradename assets in the International RAC segment was complex and highly judgmental due to the significant estimation required to determine its fair value as a result of the Company’s future projections, operating performance and the current industry and economic environment in which the Company operates. The Company’s estimate of fair value for the indefinite-lived intangible tradename assets in the International RAC segment required significant judgment to estimate the impact of changes in revenues and profitability, industry trends on future operating results and the future cash flows expected to be generated. In addition, the fair value estimate of these indefinite-lived intangible tradename assets in the International RAC segment was sensitive to significant assumptions such as projected revenues, royalty rates, terminal period revenue growth rates and the weighted average cost of capital. These significant assumptions are affected by expected future market or economic conditions, including the continuing impact of COVID-19 and the Chip Shortage as defined in the Company’s Form 10-K. | |||||||
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s indefinite-lived intangible tradename assets impairment review processes. For example, we tested controls over management’s review of the assumptions, including assumptions related to projected financial information, as outlined above that are used in the indefinite-lived intangible tradename assets impairment test. To test the estimated fair value of the International RAC segment’s indefinite-lived intangible tradename assets, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions and the completeness and accuracy of the underlying data used by the Company in its analyses. We compared the significant assumptions used by management to current industry and economic trends, expected changes to the Company’s business model, the Company’s historical results and other relevant factors. We assessed the historical accuracy of management’s estimates, including projected financial information, and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the International RAC segment indefinite-lived intangible tradename assets that would result from hypothetical changes in the assumptions. We also involved valuation specialists to assist in our evaluation of the Company’s model, valuation methodologies, and certain significant assumptions, such as the royalty rates, the terminal period revenue growth rates and the weighted average cost of capital. |
December 31, 2021 | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 2,258 | $ | 1,096 | |||||||
Restricted cash and cash equivalents: | |||||||||||
Vehicle | 77 | 50 | |||||||||
Non-vehicle | 316 | 361 | |||||||||
Total restricted cash and cash equivalents | 393 | 411 | |||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 2,651 | 1,507 | |||||||||
Receivables: | |||||||||||
Vehicle | 62 | 164 | |||||||||
Non-vehicle, net of allowance of $48 and $46, respectively | 696 | 613 | |||||||||
Total receivables, net | 758 | 777 | |||||||||
Prepaid expenses and other assets | 1,017 | 373 | |||||||||
Revenue earning vehicles: | |||||||||||
Vehicles | 10,836 | 7,540 | |||||||||
Less: accumulated depreciation | (1,610) | (1,478) | |||||||||
Total revenue earning vehicles, net | 9,226 | 6,062 | |||||||||
Property and equipment, net | 608 | 666 | |||||||||
Operating lease right-of-use assets | 1,566 | 1,675 | |||||||||
Intangible assets, net | 2,912 | 2,992 | |||||||||
Goodwill | 1,045 | 1,045 | |||||||||
Assets held for sale | — | 1,811 | |||||||||
Total assets(1) | $ | 19,783 | $ | 16,908 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Accounts payable: | |||||||||||
Vehicle | $ | 56 | $ | 29 | |||||||
Non-vehicle | 516 | 389 | |||||||||
Total accounts payable | 572 | 418 | |||||||||
Accrued liabilities | 863 | 759 | |||||||||
Accrued taxes, net | 157 | 121 | |||||||||
Debt: | |||||||||||
Vehicle | 7,921 | 6,024 | |||||||||
Non-vehicle | 2,986 | 243 | |||||||||
Total debt | 10,907 | 6,267 | |||||||||
Public Warrants | 1,324 | — | |||||||||
Operating lease liabilities | 1,510 | 1,636 | |||||||||
Self-insured liabilities | 463 | 488 | |||||||||
Deferred income taxes, net | 1,010 | 730 | |||||||||
Total liabilities not subject to compromise | 16,806 | 10,419 | |||||||||
Liabilities subject to compromise | — | 4,965 | |||||||||
Liabilities held for sale | — | 1,431 | |||||||||
Total liabilities(1) | 16,806 | 16,815 | |||||||||
Commitments and contingencies | 0 | 0 | |||||||||
Stockholders' equity: | |||||||||||
Preferred stock, $0.01 par value, no shares issued and outstanding | — | — | |||||||||
Common stock, $0.01 par value, 477,233,278 and 158,235,410 shares issued, respectively, and 449,782,424 and 156,206,478 shares outstanding, respectively | 5 | 2 | |||||||||
Treasury stock, at cost, 27,450,854 and 2,028,932 common shares, respectively | (708) | (100) | |||||||||
Additional paid-in capital | 6,209 | 3,047 | |||||||||
Retained earnings (Accumulated deficit) | (2,315) | (2,681) | |||||||||
Accumulated other comprehensive income (loss) | (214) | (212) | |||||||||
Stockholders' equity attributable to Hertz Global | 2,977 | 56 | |||||||||
Noncontrolling interests | — | 37 | |||||||||
Total stockholders' equity | 2,977 | 93 | |||||||||
Total liabilities and stockholders' equity | $ | 19,783 | $ | 16,908 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 | |||||||||||
Expenses: | |||||||||||||||||
Direct vehicle and operating | 3,920 | 3,423 | 5,305 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 497 | 2,030 | 2,563 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Selling, general and administrative | 688 | 645 | 949 | ||||||||||||||
Interest expense, net: | |||||||||||||||||
Vehicle | 284 | 455 | 494 | ||||||||||||||
Non-vehicle (excludes contractual interest of $129 million for the year ended December 31, 2020) | 185 | 153 | 311 | ||||||||||||||
Total interest expense, net | 469 | 608 | 805 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Other (income) expense, net | (21) | (9) | (59) | ||||||||||||||
Reorganization items, net | 677 | 175 | — | ||||||||||||||
(Gain) from the sale of a business | (400) | — | — | ||||||||||||||
Change in fair value of Public Warrants | 627 | — | — | ||||||||||||||
Total expenses | 6,653 | 7,310 | 9,766 | ||||||||||||||
Income (loss) before income taxes | 683 | (2,052) | 13 | ||||||||||||||
Income tax (provision) benefit | (318) | 329 | (63) | ||||||||||||||
Net income (loss) | 365 | (1,723) | (50) | ||||||||||||||
Net (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Net income (loss) attributable to Hertz Global | 366 | (1,714) | (58) | ||||||||||||||
Series A Preferred Stock deemed dividends | (450) | — | — | ||||||||||||||
Net income (loss) available to Hertz Global common stockholders | $ | (84) | $ | (1,714) | $ | (58) | |||||||||||
Weighted-average common shares outstanding: | |||||||||||||||||
Basic | 315 | 150 | 117 | ||||||||||||||
Diluted | 315 | 150 | 117 | ||||||||||||||
Earnings (loss) per common share: | |||||||||||||||||
Basic | $ | (0.27) | $ | (11.44) | $ | (0.49) | |||||||||||
Diluted | $ | (0.27) | $ | (11.44) | $ | (0.49) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net income (loss) | $ | 365 | $ | (1,723) | $ | (50) | |||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Foreign currency translation adjustments | (36) | (19) | 6 | ||||||||||||||
Net gain (loss) on pension and postretirement benefit plans | 25 | (11) | (11) | ||||||||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial net losses | 15 | 13 | 11 | ||||||||||||||
Total other comprehensive income (loss) before income taxes | 4 | (17) | 6 | ||||||||||||||
Income tax (provision) benefit related to pension and postretirement benefit plans | (3) | (4) | (1) | ||||||||||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on pension and postretirement benefit plans | (3) | (2) | (2) | ||||||||||||||
Total other comprehensive income (loss) | (2) | (23) | 3 | ||||||||||||||
Total comprehensive income (loss) | 363 | (1,746) | (47) | ||||||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Comprehensive income (loss) attributable to Hertz Global | $ | 364 | $ | (1,737) | $ | (55) |
Mezzanine Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock Shares | Preferred Stock Amount | Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock Shares | Treasury Stock Amount | Stockholders' Equity Attributable to Hertz Global | Non- controlling Interests | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2018 | — | $ | — | 84 | $ | 1 | $ | 2,261 | $ | (909) | $ | (192) | 2 | $ | (100) | $ | 1,061 | $ | 59 | $ | 1,120 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | (58) | — | — | — | (58) | 8 | (50) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | 3 | — | — | 3 | — | 3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | — | (3) | — | — | — | — | (3) | — | (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | 18 | — | — | — | — | 18 | — | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 Rights Offering, net | — | — | 58 | — | 748 | — | — | — | — | 748 | — | 748 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | — | — | — | 52 | 52 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | — | — | 142 | 1 | 3,024 | (967) | (189) | 2 | (100) | 1,769 | 119 | 1,888 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | (1,714) | — | — | — | (1,714) | (9) | (1,723) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | (23) | — | — | (23) | — | (23) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net settlement on vesting of restricted stock | — | — | — | — | (3) | — | — | — | — | (3) | — | (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | (2) | — | — | — | — | (2) | — | (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ATM Program, net | — | — | 14 | 1 | 28 | — | — | — | — | 29 | — | 29 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests, net | — | — | — | — | — | — | — | — | — | — | (73) | (73) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2020 | — | — | 156 | 2 | 3,047 | (2,681) | (212) | 2 | (100) | 56 | 37 | 93 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | 366 | — | — | — | 366 | (1) | 365 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | — | (2) | — | — | (2) | — | (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | — | — | 10 | — | — | — | — | 10 | — | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cancellation of stock-based awards | — | — | — | — | (10) | — | — | — | — | (10) | — | (10) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cancellation of common and treasury shares in exchange for new common shares | — | — | (142) | (2) | (98) | — | — | (2) | 100 | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common stockholders | — | — | — | — | (239) | — | — | — | — | (239) | — | (239) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from Plan Sponsors | — | — | 277 | 3 | 2,778 | — | — | — | — | 2,781 | — | 2,781 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 Rights Offering, net | — | — | 181 | 2 | 1,800 | — | — | — | — | 1,802 | — | 1,802 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Public Warrant issuance | — | — | — | — | (800) | — | — | — | — | (800) | — | (800) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock issuance, net | 2 | 1,433 | — | — | — | — | — | — | — | 1,433 | — | 1,433 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of preferred stock, net | (2) | (1,433) | — | — | (450) | — | — | — | — | (1,883) | — | (1,883) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Public Warrant exercises(1) | — | — | 5 | — | 180 | — | — | — | — | 180 | — | 180 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nasdaq listing and share repurchases(2) | — | — | (27) | — | (9) | — | — | 27 | (708) | (717) | — | (717) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests(3) | — | — | — | — | — | — | — | — | — | — | (36) | (36) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | — | $ | — | 450 | $ | 5 | $ | 6,209 | $ | (2,315) | $ | (214) | 27 | $ | (708) | $ | 2,977 | $ | — | $ | 2,977 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 365 | $ | (1,723) | $ | (50) | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and reserves for revenue earning vehicles | 600 | 2,259 | 2,791 | ||||||||||||||
Depreciation and amortization, non-vehicle | 196 | 225 | 203 | ||||||||||||||
Amortization of deferred financing costs and debt discount (premium) | 122 | 59 | 52 | ||||||||||||||
Loss on extinguishment of debt | 8 | 5 | 43 | ||||||||||||||
Stock-based compensation charges | 10 | (2) | 18 | ||||||||||||||
Provision for receivables allowance | 125 | 94 | 53 | ||||||||||||||
Deferred income taxes, net | 270 | (353) | 27 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Reorganization items, net | 314 | 8 | — | ||||||||||||||
(Gain) loss from the sale of a business | (400) | — | — | ||||||||||||||
(Gain) loss on marketable securities | — | — | (30) | ||||||||||||||
(Gain) loss on sale of non-vehicle capital assets | (8) | (24) | (39) | ||||||||||||||
Change in fair value of Public Warrants | 627 | — | — | ||||||||||||||
Other | (5) | 5 | (9) | ||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||
Non-vehicle receivables | (210) | 195 | (88) | ||||||||||||||
Prepaid expenses and other assets | (20) | 92 | (8) | ||||||||||||||
Operating lease right-of-use assets | 274 | 366 | 402 | ||||||||||||||
Non-vehicle accounts payable | (70) | 98 | 65 | ||||||||||||||
Accrued liabilities | (108) | (61) | (98) | ||||||||||||||
Accrued taxes, net | 24 | (52) | 14 | ||||||||||||||
Operating lease liabilities | (291) | (375) | (428) | ||||||||||||||
Self-insured liabilities | (17) | (76) | (18) | ||||||||||||||
Net cash provided by (used in) operating activities | 1,806 | 953 | 2,900 | ||||||||||||||
Cash flows from investing activities: | |||||||||||||||||
Revenue earning vehicles expenditures | (7,154) | (5,542) | (13,714) | ||||||||||||||
Proceeds from disposal of revenue earning vehicles | 2,818 | 10,098 | 9,486 | ||||||||||||||
Non-vehicle capital asset expenditures | (71) | (98) | (224) | ||||||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 16 | 60 | 27 | ||||||||||||||
Sales of marketable securities | — | 74 | — | ||||||||||||||
Collateral payments | (303) | — | — | ||||||||||||||
Collateral returned in exchange for letters of credit | 280 | — | — | ||||||||||||||
Proceeds from the sale of a business, net of cash sold | 871 | — | — | ||||||||||||||
Other | (1) | (1) | — | ||||||||||||||
Net cash provided by (used in) investing activities | (3,544) | 4,591 | (4,425) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from issuance of vehicle debt | 14,323 | 4,546 | 13,013 | ||||||||||||||
Repayments of vehicle debt | (12,607) | (10,751) | (11,530) | ||||||||||||||
Proceeds from issuance of non-vehicle debt | 4,644 | 1,812 | 3,016 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Repayments of non-vehicle debt | (6,352) | (855) | (3,732) | ||||||||||||||
Payment of financing costs | (185) | (75) | (53) | ||||||||||||||
Proceeds from Plan Sponsors | 2,781 | — | — | ||||||||||||||
Early redemption premium payment | (85) | — | (34) | ||||||||||||||
Proceeds from issuance of common stock, net | — | 28 | — | ||||||||||||||
Proceeds from exercises of Public Warrants | 77 | — | — | ||||||||||||||
Proceeds from the issuance of preferred stock, net | 1,433 | — | — | ||||||||||||||
Distributions to common stockholders | (239) | — | — | ||||||||||||||
Contributions from (distributions to) noncontrolling interests | (38) | (75) | 49 | ||||||||||||||
Proceeds from rights offerings, net | 1,639 | — | 748 | ||||||||||||||
Share repurchases | (654) | — | — | ||||||||||||||
Repurchase of preferred stock | (1,883) | — | — | ||||||||||||||
Payments for Nasdaq listing costs | (9) | — | — | ||||||||||||||
Other | — | (2) | (3) | ||||||||||||||
Net cash provided by (used in) financing activities | 2,845 | (5,372) | 1,474 | ||||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | (34) | 46 | 1 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | 1,073 | 218 | (50) | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period(1) | 1,578 | 1,360 | 1,410 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period(1) | $ | 2,651 | $ | 1,578 | $ | 1,360 | |||||||||||
Supplemental disclosures of cash flow information: | |||||||||||||||||
Cash paid during the period for: | |||||||||||||||||
Interest, net of amounts capitalized: | |||||||||||||||||
Vehicle | $ | 257 | $ | 335 | $ | 431 | |||||||||||
Non-vehicle | 198 | 109 | 272 | ||||||||||||||
Income taxes, net of refunds | 40 | (11) | 21 | ||||||||||||||
Operating lease liabilities | 472 | 546 | 575 | ||||||||||||||
Supplemental disclosures of non-cash information: | |||||||||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 27 | $ | 9 | $ | 165 | |||||||||||
Sales of revenue earning vehicles included in vehicle receivables | 33 | 144 | 667 | ||||||||||||||
Fleet payables included in liabilities subject to compromise | — | 2 | — | ||||||||||||||
Purchases of non-vehicle capital assets included in accounts payable | 24 | 7 | 40 | ||||||||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital leases | 79 | 32 | 23 | ||||||||||||||
Purchases of non-vehicle capital assets included in liabilities subject to compromise | — | 18 | — | ||||||||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 177 | 152 | 680 | ||||||||||||||
Public Warrant issuance | 800 | — | — | ||||||||||||||
Public Warrant exercises | 103 | — | — | ||||||||||||||
Backstop equity issuance | 164 | — | — | ||||||||||||||
Accrual for purchases of treasury shares | 54 | — | — |
December 31, 2021 | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 2,257 | $ | 1,096 | |||||||
Restricted cash and cash equivalents: | |||||||||||
Vehicle | 77 | 50 | |||||||||
Non-vehicle | 316 | 333 | |||||||||
Total restricted cash and cash equivalents | 393 | 383 | |||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 2,650 | 1,479 | |||||||||
Receivables: | |||||||||||
Vehicle | 62 | 164 | |||||||||
Non-vehicle, net of allowance of $48 and $46, respectively | 695 | 613 | |||||||||
Total receivables, net | 757 | 777 | |||||||||
Due from Hertz Holdings | — | 1 | |||||||||
Prepaid expenses and other assets | 1,016 | 372 | |||||||||
Revenue earning vehicles: | |||||||||||
Vehicles | 10,836 | 7,540 | |||||||||
Less: accumulated depreciation | (1,610) | (1,478) | |||||||||
Total revenue earning vehicles, net | 9,226 | 6,062 | |||||||||
Property and equipment, net | 608 | 666 | |||||||||
Operating lease right-of-use assets | 1,566 | 1,675 | |||||||||
Intangible assets, net | 2,912 | 2,992 | |||||||||
Goodwill | 1,045 | 1,045 | |||||||||
Assets held for sale | — | 1,811 | |||||||||
Total assets(1) | $ | 19,780 | $ | 16,880 | |||||||
LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT) | |||||||||||
Accounts payable: | |||||||||||
Vehicle | $ | 56 | $ | 29 | |||||||
Non-vehicle | 516 | 389 | |||||||||
Total accounts payable | 572 | 418 | |||||||||
Accrued liabilities | 809 | 759 | |||||||||
Accrued taxes, net | 157 | 121 | |||||||||
Debt: | |||||||||||
Vehicle | 7,921 | 6,024 | |||||||||
Non-vehicle | 2,986 | 243 | |||||||||
Total debt | 10,907 | 6,267 | |||||||||
Operating lease liabilities | 1,510 | 1,636 | |||||||||
Self-insured liabilities | 463 | 488 | |||||||||
Deferred income taxes, net | 1,012 | 735 | |||||||||
Total liabilities not subject to compromise | 15,430 | 10,424 | |||||||||
Liabilities subject to compromise | — | 5,030 | |||||||||
Liabilities held for sale | — | 1,431 | |||||||||
Total liabilities(1) | 15,430 | 16,885 | |||||||||
Commitments and contingencies | 0 | 0 | |||||||||
Stockholder's equity (deficit): | |||||||||||
Common stock, $0.01 par value, 3,000 shares authorized and 100 shares issued and outstanding | — | — | |||||||||
Additional paid-in capital | 7,190 | 3,953 | |||||||||
Retained earnings (Accumulated deficit) | (2,626) | (3,783) | |||||||||
Accumulated other comprehensive income (loss) | (214) | (212) | |||||||||
Stockholder's equity (deficit) attributable to Hertz | 4,350 | (42) | |||||||||
Noncontrolling interests | — | 37 | |||||||||
Total stockholder's equity (deficit) | 4,350 | (5) | |||||||||
Total liabilities and stockholder's equity (deficit) | $ | 19,780 | $ | 16,880 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 | |||||||||||
Expenses: | |||||||||||||||||
Direct vehicle and operating | 3,920 | 3,423 | 5,305 | ||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 497 | 2,030 | 2,563 | ||||||||||||||
Non-vehicle depreciation and amortization | 196 | 225 | 203 | ||||||||||||||
Selling, general and administrative | 688 | 645 | 949 | ||||||||||||||
Interest expense, net: | |||||||||||||||||
Vehicle | 284 | 455 | 494 | ||||||||||||||
Non-vehicle (excludes contractual interest of $129 million for the year ended December 31, 2020) | 185 | 151 | 304 | ||||||||||||||
Total interest expense, net | 469 | 606 | 798 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Write-off of intercompany loan | — | 133 | — | ||||||||||||||
Other (income) expense, net | (21) | (9) | (59) | ||||||||||||||
Reorganization items, net | 513 | 175 | — | ||||||||||||||
(Gain) from the sale of a business | (400) | — | — | ||||||||||||||
Total expenses | 5,862 | 7,441 | 9,759 | ||||||||||||||
Income (loss) before income taxes | 1,474 | (2,183) | 20 | ||||||||||||||
Income tax (provision) benefit | (318) | 328 | (65) | ||||||||||||||
Net income (loss) | 1,156 | (1,855) | (45) | ||||||||||||||
Net (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Net income (loss) attributable to Hertz | $ | 1,157 | $ | (1,846) | $ | (53) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net income (loss) | $ | 1,156 | $ | (1,855) | $ | (45) | |||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Foreign currency translation adjustments | (36) | (19) | 6 | ||||||||||||||
Net gain (loss) on pension and postretirement benefit plans | 25 | (11) | (11) | ||||||||||||||
Reclassification from other comprehensive income (loss) to other (income) expense for amortization of actuarial net losses | 15 | 13 | 11 | ||||||||||||||
Total other comprehensive income (loss) before income taxes | 4 | (17) | 6 | ||||||||||||||
Income tax (provision) benefit related to pension and postretirement benefit plans | (3) | (4) | (1) | ||||||||||||||
Income tax (provision) benefit related to reclassified amounts of net periodic costs on pension and postretirement benefit plans | (3) | (2) | (2) | ||||||||||||||
Total other comprehensive income (loss) | (2) | (23) | 3 | ||||||||||||||
Total comprehensive income (loss) | 1,154 | (1,878) | (42) | ||||||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | 1 | 9 | (8) | ||||||||||||||
Comprehensive income (loss) attributable to Hertz | $ | 1,155 | $ | (1,869) | $ | (50) |
Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Due From Affiliate | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Stockholder's Equity (Deficit) Attributable to Hertz | Noncontrolling Interests | Total Stockholder's Equity (Deficit) | |||||||||||||||||||||||||||||||||||||||||||||
Balance as of: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2018 | 100 | — | 3,187 | (52) | (1,884) | (192) | 1,059 | 59 | 1,118 | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (53) | — | (53) | 8 | (45) | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | 3 | 3 | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (12) | — | — | (12) | — | (12) | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | 18 | — | — | — | 18 | — | 18 | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from Hertz Holdings | — | — | 750 | — | — | — | 750 | — | 750 | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | — | — | 52 | 52 | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | 100 | — | 3,955 | (64) | (1,937) | (189) | 1,765 | 119 | 1,884 | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | (1,846) | — | (1,846) | (9) | (1,855) | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (23) | (23) | — | (23) | ||||||||||||||||||||||||||||||||||||||||||||
Due from Hertz Holdings | — | — | — | (4) | — | — | (4) | — | (4) | ||||||||||||||||||||||||||||||||||||||||||||
Liabilities subject to compromise(1) | — | — | — | (65) | — | — | (65) | — | (65) | ||||||||||||||||||||||||||||||||||||||||||||
Write-off of intercompany loan(1) | — | — | — | 133 | — | — | 133 | — | 133 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | (2) | — | — | — | (2) | — | (2) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests, net | — | — | — | — | — | — | — | (73) | (73) | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2020 | 100 | — | 3,953 | — | (3,783) | (212) | (42) | 37 | (5) | ||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | 1,157 | — | 1,157 | (1) | 1,156 | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | — | (2) | (2) | — | (2) | ||||||||||||||||||||||||||||||||||||||||||||
Non-cash distribution(1) | — | — | 65 | — | — | — | 65 | — | 65 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation charges | — | — | 10 | — | — | — | 10 | — | 10 | ||||||||||||||||||||||||||||||||||||||||||||
Cancellation of stock-based awards | — | — | (10) | — | — | — | (10) | — | (10) | ||||||||||||||||||||||||||||||||||||||||||||
Contributions from Hertz Holdings | — | — | 5,642 | — | — | — | 5,642 | — | 5,642 | ||||||||||||||||||||||||||||||||||||||||||||
Dividends to Hertz Holdings | — | — | (2,470) | — | — | — | (2,470) | — | (2,470) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests(2) | — | — | — | — | — | — | — | (36) | (36) | ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | 100 | $ | — | $ | 7,190 | $ | — | $ | (2,626) | $ | (214) | $ | 4,350 | $ | — | $ | 4,350 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 1,156 | $ | (1,855) | $ | (45) | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and reserves for revenue earning vehicles | 600 | 2,259 | 2,791 | ||||||||||||||
Depreciation and amortization, non-vehicle | 196 | 225 | 203 | ||||||||||||||
Amortization of deferred financing costs and debt discount (premium) | 122 | 59 | 52 | ||||||||||||||
Loss on extinguishment of debt | 8 | 5 | 43 | ||||||||||||||
Stock-based compensation charges | 10 | (2) | 18 | ||||||||||||||
Provision for receivables allowance | 125 | 94 | 53 | ||||||||||||||
Deferred income taxes, net | 270 | (353) | 28 | ||||||||||||||
Technology-related intangible and other asset impairments | — | 213 | — | ||||||||||||||
Write-off of intercompany loan | — | 133 | — | ||||||||||||||
Reorganization items, net | 150 | 8 | — | ||||||||||||||
(Gain) loss from the sale of a business | (400) | — | — | ||||||||||||||
(Gain) loss on marketable securities | — | — | (30) | ||||||||||||||
(Gain) loss on sale of non-vehicle capital assets | (8) | (24) | (39) | ||||||||||||||
Other | (5) | 5 | (8) | ||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||
Non-vehicle receivables | (210) | 195 | (88) | ||||||||||||||
Prepaid expenses and other assets | (20) | 94 | (8) | ||||||||||||||
Operating lease right-of-use assets | 274 | 366 | 402 | ||||||||||||||
Non-vehicle accounts payable | (70) | 98 | 65 | ||||||||||||||
Accrued liabilities | (108) | (61) | (98) | ||||||||||||||
Accrued taxes, net | 24 | (52) | 14 | ||||||||||||||
Operating lease liabilities | (291) | (375) | (428) | ||||||||||||||
Self-insured liabilities | (17) | (76) | (18) | ||||||||||||||
Net cash provided by (used in) operating activities | 1,806 | 956 | 2,907 | ||||||||||||||
Cash flows from investing activities: | |||||||||||||||||
Revenue earning vehicles expenditures | (7,154) | (5,542) | (13,714) | ||||||||||||||
Proceeds from disposal of revenue earning vehicles | 2,818 | 10,098 | 9,486 | ||||||||||||||
Non-vehicle capital asset expenditures | (71) | (98) | (224) | ||||||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 16 | 60 | 27 | ||||||||||||||
Sales of marketable securities | — | 74 | — | ||||||||||||||
Collateral payments | (303) | — | — | ||||||||||||||
Collateral returned in exchange for letters of credit | 280 | — | — | ||||||||||||||
Proceeds from the sale of a business, net of cash sold | 871 | — | — | ||||||||||||||
Other | (1) | (1) | — | ||||||||||||||
Net cash provided by (used in) investing activities | (3,544) | 4,591 | (4,425) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from issuance of vehicle debt | 14,323 | 4,546 | 13,013 | ||||||||||||||
Repayments of vehicle debt | (12,607) | (10,751) | (11,530) | ||||||||||||||
Proceeds from issuance of non-vehicle debt | 4,644 | 1,812 | 3,016 | ||||||||||||||
Repayments of non-vehicle debt | (6,352) | (855) | (3,732) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Payment of financing costs | (185) | (75) | (53) | ||||||||||||||
Early redemption premium payment | (85) | — | (34) | ||||||||||||||
Advances to Hertz Holdings | — | (5) | (12) | ||||||||||||||
Contributions from (distributions to) noncontrolling interests | (38) | (75) | 49 | ||||||||||||||
Dividends paid to Hertz Holdings | (2,470) | — | — | ||||||||||||||
Contributions from Hertz Holdings | 5,642 | — | 750 | ||||||||||||||
Net cash provided by (used in) financing activities | 2,872 | (5,403) | 1,467 | ||||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | (34) | 46 | 1 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | 1,100 | 190 | (50) | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period(1) | 1,550 | 1,360 | 1,410 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period (1) | $ | 2,650 | $ | 1,550 | $ | 1,360 | |||||||||||
Supplemental disclosures of cash flow information: | |||||||||||||||||
Cash paid during the period for: | |||||||||||||||||
Interest, net of amounts capitalized: | |||||||||||||||||
Vehicle | $ | 257 | $ | 335 | $ | 431 | |||||||||||
Non-vehicle | 198 | 109 | 272 | ||||||||||||||
Income taxes, net of refunds | 40 | (11) | 21 | ||||||||||||||
Operating lease liabilities | 472 | 546 | 575 | ||||||||||||||
Supplemental disclosures of non-cash information: | |||||||||||||||||
Purchases of revenue earning vehicles included in accounts payable, net of incentives | $ | 27 | $ | 9 | $ | 165 | |||||||||||
Sales of revenue earning vehicles included in vehicle receivables | 33 | 144 | 667 | ||||||||||||||
Fleet payables included in liabilities subject to compromise | — | 2 | — | ||||||||||||||
Purchases of non-vehicle capital assets included in accounts payable | 24 | 7 | 40 | ||||||||||||||
Revenue earning vehicles and non-vehicle capital assets acquired through capital leases | 79 | 32 | 23 | ||||||||||||||
Purchases of non-vehicle capital assets included in liabilities subject to compromise | — | 18 | — | ||||||||||||||
Operating lease right-of-use assets obtained in exchange for lease liabilities | 177 | 152 | 680 | ||||||||||||||
Non-cash capital contribution from Hertz Holdings | 65 | — | — |
(In millions) | December 31, 2021 | December 31, 2020 | |||||||||
Land, buildings and leasehold improvements | $ | 971 | $ | 1,277 | |||||||
Service vehicles, equipment and furniture and fixtures | 339 | 761 | |||||||||
Less: accumulated depreciation | (702) | (1,372) | |||||||||
Total property and equipment, net | $ | 608 | $ | 666 |
December 31, 2019 | December 31, 2018 | ||||||
Land, buildings and leasehold improvements | $ | 1,271 | $ | 1,220 | |||
Service vehicles, equipment and furniture and fixtures | 798 | 782 | |||||
Less: accumulated depreciation | (1,312 | ) | (1,224 | ) | |||
Total property and equipment, net | $ | 757 | $ | 778 |
Buildings | 1 to 50 years | ||||
Furniture and fixtures | 1 to 5 years | ||||
Service vehicles and equipment | 1 to 25 years | ||||
Leasehold improvements | The lesser of the economic life or the lease term |
(In millions) | Operating Lease Right-of-Use Assets | Prepaid and Other Assets | Total Assets | Operating Lease Liabilities | Accrued Liabilities | Total Liabilities | Total Liabilities and Stockholders' Equity | ||||||||||||||||||||
As of December 31, 2018 | $ | — | $ | 902 | $ | 21,382 | $ | — | $ | 1,304 | $ | 20,262 | $ | 21,382 | |||||||||||||
Effect of Adopting Topic 842 | 1,585 | (45 | ) | 1,540 | 1,588 | (48 | ) | 1,540 | 1,540 | ||||||||||||||||||
As of January 1, 2019 | $ | 1,585 | $ | 857 | $ | 22,922 | $ | 1,588 | $ | 1,256 | $ | 21,802 | $ | 22,922 |
(In millions) | Operating Lease Right-of-Use Assets | Prepaid and Other Assets | Total Assets | Operating Lease Liabilities | Accrued Liabilities | Total Liabilities | Total Liabilities and Stockholder's Equity | ||||||||||||||||||||
As of December 31, 2018 | $ | — | $ | 902 | $ | 21,382 | $ | — | $ | 1,304 | $ | 20,264 | $ | 21,382 | |||||||||||||
Effect of Adopting Topic 842 | 1,585 | (45 | ) | 1,540 | 1,588 | (48 | ) | 1,540 | 1,540 | ||||||||||||||||||
As of January 1, 2019 | $ | 1,585 | $ | 857 | $ | 22,922 | $ | 1,588 | $ | 1,256 | $ | 21,804 | $ | 22,922 |
(in millions) | December 31, 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 3 | |||||||||
Restricted cash and cash equivalents | 68 | ||||||||||
Receivables, net | 207 | ||||||||||
Prepaid expenses and other assets | 28 | ||||||||||
Revenue earning vehicles, net | 1,432 | ||||||||||
Property and equipment, net | 6 | ||||||||||
Operating lease right-of-use assets | 2 | ||||||||||
Intangible assets, net | 29 | ||||||||||
Goodwill | 36 | ||||||||||
Total assets held for sale | $ | 1,811 | |||||||||
LIABILITIES | |||||||||||
Accounts payable | $ | 76 | |||||||||
Accrued liabilities | 19 | ||||||||||
Accrued taxes, net | 3 | ||||||||||
Vehicle debt | 1,327 | ||||||||||
Operating lease liabilities | 6 | ||||||||||
Total liabilities held for sale | $ | 1,431 |
December 31, | |||||||||||
(In millions) | 2021 | 2020(1) | |||||||||
Revenue earning vehicles | $ | 10,506 | $ | 7,492 | |||||||
Less accumulated depreciation | (1,518) | (1,467) | |||||||||
8,988 | 6,025 | ||||||||||
Revenue earning vehicles held for sale, net(2) | 238 | 37 | |||||||||
Revenue earning vehicles, net | $ | 9,226 | $ | 6,062 |
(In millions) | U.S. Rental Car | International Rental Car | All Other Operations | Total | |||||||||||
Balance as of January 1, 2019 | |||||||||||||||
Goodwill | $ | 1,029 | $ | 236 | $ | 36 | $ | 1,301 | |||||||
Accumulated impairment losses | — | (218 | ) | — | (218 | ) | |||||||||
1,029 | 18 | 36 | 1,083 | ||||||||||||
Goodwill acquired and other changes during the period | — | — | — | — | |||||||||||
— | — | — | — | ||||||||||||
Balance as of December 31, 2019 | |||||||||||||||
Goodwill | 1,029 | 236 | 36 | 1,301 | |||||||||||
Accumulated impairment losses | — | (218 | ) | — | (218 | ) | |||||||||
$ | 1,029 | $ | 18 | $ | 36 | $ | 1,083 |
(In millions) | U.S. Rental Car | International Rental Car | All Other Operations | Total | |||||||||||
Balance as of January 1, 2018 | |||||||||||||||
Goodwill | $ | 1,029 | $ | 237 | $ | 36 | $ | 1,302 | |||||||
Accumulated impairment losses | — | (218 | ) | — | (218 | ) | |||||||||
1,029 | 19 | 36 | 1,084 | ||||||||||||
Goodwill acquired and other changes during the period(1) | — | (1 | ) | — | (1 | ) | |||||||||
— | (1 | ) | — | (1 | ) | ||||||||||
Balance as of December 31, 2018 | |||||||||||||||
Goodwill | 1,029 | 236 | 36 | 1,301 | |||||||||||
Accumulated impairment losses | — | (218 | ) | — | (218 | ) | |||||||||
$ | 1,029 | $ | 18 | $ | 36 | $ | 1,083 |
December 31, 2019 | |||||||||||
(In millions) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Value | ||||||||
Amortizable intangible assets: | |||||||||||
Customer-related | $ | 333 | $ | (313 | ) | $ | 20 | ||||
Concession rights | 414 | (324 | ) | 90 | |||||||
Technology-related intangibles(1) | 515 | (236 | ) | 279 | |||||||
Other(2) | 74 | (64 | ) | 10 | |||||||
Total | 1,336 | (937 | ) | 399 | |||||||
Indefinite-lived intangible assets: | |||||||||||
Tradenames | 2,814 | — | 2,814 | ||||||||
Other(3) | 25 | — | 25 | ||||||||
Total | 2,839 | — | 2,839 | ||||||||
Total intangible assets, net | $ | 4,175 | $ | (937 | ) | $ | 3,238 |
December 31, 2018 | |||||||||||
(In millions) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Value | ||||||||
Amortizable intangible assets: | |||||||||||
Customer-related | $ | 333 | $ | (309 | ) | $ | 24 | ||||
Concession rights | 413 | (279 | ) | 134 | |||||||
Technology-related intangibles(1) | 412 | (219 | ) | 193 | |||||||
Other(2) | 82 | (69 | ) | 13 | |||||||
Total | 1,240 | (876 | ) | 364 | |||||||
Indefinite-lived intangible assets: | |||||||||||
Tradenames | 2,814 | — | 2,814 | ||||||||
Other(3) | 25 | — | 25 | ||||||||
Total | 2,839 | — | 2,839 | ||||||||
Total intangible assets, net | $ | 4,079 | $ | (876 | ) | $ | 3,203 |
(In millions) | Americas RAC segment | International RAC segment | Total | ||||||||||||||||||||
Balance as of January 1, 2021 | |||||||||||||||||||||||
Goodwill(1) | $ | 1,029 | $ | 236 | $ | 1,265 | |||||||||||||||||
Accumulated impairment losses | — | (220) | (220) | ||||||||||||||||||||
1,029 | 16 | 1,045 | |||||||||||||||||||||
Goodwill disposal and other changes during the period | — | — | — | ||||||||||||||||||||
— | — | — | |||||||||||||||||||||
Balance as of December 31, 2021 | |||||||||||||||||||||||
Goodwill | 1,029 | 236 | 1,265 | ||||||||||||||||||||
Accumulated impairment losses | — | (220) | (220) | ||||||||||||||||||||
$ | 1,029 | $ | 16 | $ | 1,045 |
(In millions) | Americas RAC segment | International RAC segment | Total(1) | ||||||||||||||||||||
Balance as of January 1, 2020 | |||||||||||||||||||||||
Goodwill | $ | 1,029 | $ | 236 | $ | 1,265 | |||||||||||||||||
Accumulated impairment losses | — | (218) | (218) | ||||||||||||||||||||
1,029 | 18 | 1,047 | |||||||||||||||||||||
Goodwill disposal and other changes during the period | — | (2) | (2) | ||||||||||||||||||||
— | (2) | (2) | |||||||||||||||||||||
Balance as of December 31, 2020 | |||||||||||||||||||||||
Goodwill | 1,029 | 236 | 1,265 | ||||||||||||||||||||
Accumulated impairment losses | — | (220) | (220) | ||||||||||||||||||||
$ | 1,029 | $ | 16 | $ | 1,045 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Amortization of intangible assets | $ | 81 | $ | 89 | $ | 97 |
December 31, 2021 | |||||||||||||||||
(In millions) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Value | ||||||||||||||
Amortizable intangible assets: | |||||||||||||||||
Customer-related | $ | 269 | $ | (269) | $ | — | |||||||||||
Concession rights | 408 | (405) | 3 | ||||||||||||||
Technology-related intangibles | 359 | (271) | 88 | ||||||||||||||
Other(1) | 48 | (45) | 3 | ||||||||||||||
Total | 1,084 | (990) | 94 | ||||||||||||||
Indefinite-lived intangible assets: | |||||||||||||||||
Tradenames(2) | 2,794 | — | 2,794 | ||||||||||||||
Other(3) | 24 | — | 24 | ||||||||||||||
Total | 2,818 | — | 2,818 | ||||||||||||||
Total intangible assets, net | $ | 3,902 | $ | (990) | $ | 2,912 |
December 31, 2020(4) | |||||||||||||||||
(In millions) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Value | ||||||||||||||
Amortizable intangible assets: | |||||||||||||||||
Customer-related | $ | 269 | $ | (269) | $ | — | |||||||||||
Concession rights | 408 | (365) | 43 | ||||||||||||||
Technology-related intangibles | 355 | (228) | 127 | ||||||||||||||
Other(1) | 48 | (44) | 4 | ||||||||||||||
Total | 1,080 | (906) | 174 | ||||||||||||||
Indefinite-lived intangible assets: | |||||||||||||||||
Tradenames(2) | 2,794 | — | 2,794 | ||||||||||||||
Other(3) | 24 | — | 24 | ||||||||||||||
Total | 2,818 | — | 2,818 | ||||||||||||||
Total intangible assets, net | $ | 3,898 | $ | (906) | $ | 2,992 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Amortization of intangible assets | $ | 88 | $ | 96 | $ | 81 |
(In millions) | ||||||||
2022 | $ | 41 | ||||||
2023 | 24 | |||||||
2024 | 17 | |||||||
2025 | 6 | |||||||
2026 | 2 | |||||||
After 2026 | 4 | |||||||
Total expected amortization expense | $ | 94 |
(In millions) | ||||
2020 | $ | 105 | ||
2021 | 94 | |||
2022 | 50 | |||
2023 | 43 | |||
2024 | 40 | |||
After 2024 | 67 | |||
Total expected amortization expense | $ | 399 |
Facility | Weighted-Average Interest Rate as of December 31, 2021 | Fixed or Floating Interest Rate | Maturity | December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||
Non-Vehicle Debt | ||||||||||||||||||||||||||||||||
Term B Loan | 3.75% | Floating | 6/2028 | $ | 1,294 | $ | — | |||||||||||||||||||||||||
Term C Loan | 3.75% | Floating | 6/2028 | 245 | — | |||||||||||||||||||||||||||
Senior Notes Due 2026 | 4.63% | Fixed | 12/2026 | 500 | — | |||||||||||||||||||||||||||
Senior Notes Due 2029 | 5.00% | Fixed | 12/2029 | 1,000 | — | |||||||||||||||||||||||||||
First Lien RCF | N/A | Floating | 6/2026 | — | — | |||||||||||||||||||||||||||
Other Non-Vehicle Debt(1) | 8.49% | Fixed | Various | 16 | 18 | |||||||||||||||||||||||||||
Senior Secured Superpriority Debtor-in-Possession Credit Agreement | N/A | N/A | N/A | — | 250 | |||||||||||||||||||||||||||
Unamortized Debt Issuance Costs and Net (Discount) Premium | (69) | (25) | ||||||||||||||||||||||||||||||
Total Non-Vehicle Debt Not Subject to Compromise | 2,986 | 243 | ||||||||||||||||||||||||||||||
Non-Vehicle Debt Subject to Compromise(2) | ||||||||||||||||||||||||||||||||
Senior Term Loan | N/A | N/A | N/A | — | 656 | |||||||||||||||||||||||||||
Senior RCF | N/A | N/A | N/A | — | 615 | |||||||||||||||||||||||||||
Senior Notes(2) | N/A | N/A | N/A | — | 2,700 | |||||||||||||||||||||||||||
Senior Second Priority Secured Notes | N/A | N/A | N/A | — | 350 | |||||||||||||||||||||||||||
Promissory Notes | N/A | N/A | N/A | — | 27 | |||||||||||||||||||||||||||
Alternative Letter of Credit Facility(3) | N/A | N/A | N/A | — | 114 | |||||||||||||||||||||||||||
Senior RCF Letter of Credit Facility | N/A | N/A | N/A | — | 17 | |||||||||||||||||||||||||||
Unamortized Debt Issuance Costs and Net (Discount) Premium | — | (36) | ||||||||||||||||||||||||||||||
Total Non-Vehicle Debt Subject to Compromise | — | 4,443 | ||||||||||||||||||||||||||||||
Vehicle Debt | ||||||||||||||||||||||||||||||||
HVF III U.S. ABS Program | ||||||||||||||||||||||||||||||||
HVF III U.S. Vehicle Variable Funding Notes | ||||||||||||||||||||||||||||||||
HVF III Series 2021-A Class A(4) | 1.62% | Floating | 6/2023 | 2,813 | — | |||||||||||||||||||||||||||
Facility | Weighted-Average Interest Rate as of December 31, 2019 | Fixed or Floating Interest Rate | Maturity | December 31, 2019 | December 31, 2018 | |||||||||
Non-Vehicle Debt | ||||||||||||||
Senior Term Loan | 4.45% | Floating | 6/2023 | $ | 660 | $ | 674 | |||||||
Senior RCF | N/A | Floating | 6/2021 | — | — | |||||||||
Senior Notes(1) | 6.11% | Fixed | 10/2022-1/2028 | 2,700 | 2,500 | |||||||||
Senior Second Priority Secured Notes | 7.63% | Fixed | 6/2022 | 350 | 1,250 | |||||||||
Promissory Notes | 7.00% | Fixed | 1/2028 | 27 | 27 | |||||||||
Other Non-Vehicle Debt | 5.70% | Fixed | Various | 18 | 4 | |||||||||
Unamortized Debt Issuance Costs and Net (Discount) Premium | (34 | ) | (33 | ) | ||||||||||
Total Non-Vehicle Debt | 3,721 | 4,422 | ||||||||||||
Vehicle Debt | ||||||||||||||
HVF II U.S. ABS Program | ||||||||||||||
HVF II U.S. Vehicle Variable Funding Notes | ||||||||||||||
HVF II Series 2013-A(2) | 3.09% | Floating | 3/2021 | 2,644 | 2,940 | |||||||||
2,644 | 2,940 | |||||||||||||
HVF II U.S. Vehicle Medium Term Notes | ||||||||||||||
HVF II Series 2015-1(2) | 2.93% | Fixed | 3/2020 | 780 | 780 | |||||||||
HVF II Series 2015-3(2) | 3.10% | Fixed | 9/2020 | 371 | 371 | |||||||||
HVF II Series 2016-1(2) | N/A | N/A | N/A | — | 466 | |||||||||
HVF II Series 2016-2(2) | 3.41% | Fixed | 3/2021 | 595 | 595 | |||||||||
HVF II Series 2016-3(2) | N/A | N/A | N/A | — | 424 | |||||||||
HVF II Series 2016-4(2) | 3.09% | Fixed | 7/2021 | 424 | 424 |
Facility | Weighted-Average Interest Rate as of December 31, 2019 | Fixed or Floating Interest Rate | Maturity | December 31, 2019 | December 31, 2018 | |||||||||
HVF II Series 2017-1(2) | 3.38% | Fixed | 10/2020 | 450 | 450 | |||||||||
HVF II Series 2017-2(2) | 3.57% | Fixed | 10/2022 | 350 | 350 | |||||||||
HVF II Series 2018-1(2) | 3.41% | Fixed | 2/2023 | 1,000 | 1,000 | |||||||||
HVF II Series 2018-2(2) | 3.80% | Fixed | 6/2021 | 200 | 200 | |||||||||
HVF II Series 2018-3(2) | 4.15% | Fixed | 7/2023 | 200 | 200 | |||||||||
HVF II Series 2019-1(2) | 3.85% | Fixed | 3/2022 | 700 | — | |||||||||
HVF II Series 2019-2(2) | 3.51% | Fixed | 5/2024 | 750 | — | |||||||||
HVF II Series 2019-3(2) | 2.91% | Fixed | 12/2024 | 800 | — | |||||||||
6,620 | 5,260 | |||||||||||||
Donlen U.S. ABS Program | ||||||||||||||
HFLF Variable Funding Notes | ||||||||||||||
HFLF Series 2013-2(2) | 2.67% | Floating | 3/2021 | 286 | 320 | |||||||||
286 | 320 | |||||||||||||
HFLF Medium Term Notes | ||||||||||||||
HFLF Series 2015-1(3) | N/A | N/A | N/A | — | 33 | |||||||||
HFLF Series 2016-1(3) | 4.89% | Both | 1/2020-2/2020 | 34 | 171 | |||||||||
HFLF Series 2017-1(3) | 2.69% | Both | 1/2020-5/2021 | 229 | 397 | |||||||||
HFLF Series 2018-1(3) | 3.03% | Both | 1/2020-9/2022 | 462 | 550 | |||||||||
HFLF Series 2019-1(3) | 2.65% | Both | 2/2020-11/2022 | 650 | — | |||||||||
1,375 | 1,151 | |||||||||||||
Vehicle Debt - Other | ||||||||||||||
U.S. Vehicle RCF | 4.23% | Floating | 6/2021 | 146 | 146 | |||||||||
European Vehicle Notes(4) | 5.07% | Fixed | 10/2021-3/2023 | 810 | 829 | |||||||||
European ABS(2) | 1.60% | Floating | 11/2021 | 766 | 600 | |||||||||
Hertz Canadian Securitization(2) | 3.09% | Floating | 3/2021 | 241 | 220 | |||||||||
Donlen Canadian Securitization(2) | 2.97% | Floating | 12/2022 | 24 | — | |||||||||
Australian Securitization(2) | 2.52% | Floating | 6/2021 | 177 | 155 | |||||||||
New Zealand RCF | 3.81% | Floating | 6/2021 | 50 | 40 | |||||||||
U.K. Financing Facility | 3.06% | Floating | 1/2020-9/2022 | 247 | 242 | |||||||||
Other Vehicle Debt | 3.83% | Floating | 1/2020-11/2024 | 29 | 42 | |||||||||
2,490 | 2,274 | |||||||||||||
Unamortized Debt Issuance Costs and Net (Discount) Premium | (47 | ) | (43 | ) | ||||||||||
Total Vehicle Debt | 13,368 | 11,902 | ||||||||||||
Total Debt | $ | 17,089 | $ | 16,324 |
Facility | Weighted-Average Interest Rate as of December 31, 2021 | Fixed or Floating Interest Rate | Maturity | December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||
HVF III Series 2021-A Class B(4) | 3.65% | Fixed | 6/2023 | 188 | — | |||||||||||||||||||||||||||
3,001 | — | |||||||||||||||||||||||||||||||
HVF III U.S. Vehicle Medium Term Notes | ||||||||||||||||||||||||||||||||
HVF III Series 2021-1(4) | 1.66% | Fixed | 12/2024 | 2,000 | — | |||||||||||||||||||||||||||
HVF III Series 2021-2(4) | 2.12% | Fixed | 12/2026 | 2,000 | — | |||||||||||||||||||||||||||
4,000 | — | |||||||||||||||||||||||||||||||
HVF II U.S. ABS Program | ||||||||||||||||||||||||||||||||
HVF II U.S. Vehicle Variable Funding Notes | ||||||||||||||||||||||||||||||||
HVF II Series 2013-A(5) | N/A | N/A | N/A | — | 1,940 | |||||||||||||||||||||||||||
— | 1,940 | |||||||||||||||||||||||||||||||
HVF II U.S. Vehicle Medium Term Notes | ||||||||||||||||||||||||||||||||
HVF II Series 2015-3 | N/A | N/A | N/A | — | 163 | |||||||||||||||||||||||||||
HVF II Series 2016-2 | N/A | N/A | N/A | — | 263 | |||||||||||||||||||||||||||
HVF II Series 2016-4 | N/A | N/A | N/A | — | 187 | |||||||||||||||||||||||||||
HVF II Series 2017-1 | N/A | N/A | N/A | — | 199 | |||||||||||||||||||||||||||
HVF II Series 2017-2 | N/A | N/A | N/A | — | 164 | |||||||||||||||||||||||||||
HVF II Series 2018-1 | N/A | N/A | N/A | — | 468 | |||||||||||||||||||||||||||
HVF II Series 2018-2 | N/A | N/A | N/A | — | 94 | |||||||||||||||||||||||||||
HVF II Series 2018-3 | N/A | N/A | N/A | — | 95 | |||||||||||||||||||||||||||
HVF II Series 2019-1 | N/A | N/A | N/A | — | 330 | |||||||||||||||||||||||||||
HVF II Series 2019-2 | N/A | N/A | N/A | — | 354 | |||||||||||||||||||||||||||
HVF II Series 2019-3 | N/A | N/A | N/A | — | 352 | |||||||||||||||||||||||||||
— | 2,669 | |||||||||||||||||||||||||||||||
Vehicle Debt - Other | ||||||||||||||||||||||||||||||||
European Vehicle Notes(6) | N/A | N/A | N/A | — | 888 | |||||||||||||||||||||||||||
European ABS(4) | 1.80% | Floating | 10/2023 | 395 | 263 | |||||||||||||||||||||||||||
Hertz Canadian Securitization(4) | 2.49% | Floating | 1/2023 | 191 | 53 | |||||||||||||||||||||||||||
Australian Securitization(4) | 1.66% | Floating | 4/2022 | 128 | 97 | |||||||||||||||||||||||||||
New Zealand RCF | 3.49% | Floating | 6/2022 | 39 | 35 | |||||||||||||||||||||||||||
U.K. Financing Facility | 3.68% | Floating | 1/2022-12/2024 | 98 | 105 | |||||||||||||||||||||||||||
U.K. Toyota Financing Facility | 2.20% | Floating | 2/2022-2/2023 | 9 | — | |||||||||||||||||||||||||||
Other Vehicle Debt | 2.89% | Floating | 1/2022-12/2024 | 93 | 37 | |||||||||||||||||||||||||||
953 | 1,478 | |||||||||||||||||||||||||||||||
Unamortized Debt Issuance Costs and Net (Discount) Premium | (33) | (63) | ||||||||||||||||||||||||||||||
Total Vehicle Debt Not Subject to Compromise | 7,921 | 6,024 | ||||||||||||||||||||||||||||||
Total Debt Not Subject to Compromise | $ | 10,907 | $ | 6,267 |
(In millions) | Outstanding Principal | ||||||
Senior Notes | December 31, 2019 | December 31, 2018 | |||||
5.875% Senior Notes due October 2020 | $ | — | $ | 700 | |||
7.375% Senior Notes due January 2021 | — | 500 | |||||
6.250% Senior Notes due October 2022 | 500 | 500 | |||||
5.500% Senior Notes due October 2024 | 800 | 800 | |||||
7.125% Senior Notes due August 2026 | 500 | — | |||||
6.000% Senior Notes due January 2028 | 900 | — | |||||
$ | 2,700 | $ | 2,500 |
Senior Notes | December 31, 2021 | December 31, 2020 | |||||||||
6.250% Senior Notes due | $ | — | $ | 500 | |||||||
5.500% Senior Notes due October 2024 | — | 800 | |||||||||
7.125% Senior Notes due August 2026 | — | 500 | |||||||||
6.000% Senior Notes due January 2028 | — | 900 | |||||||||
$ | — | $ | 2,700 |
European Vehicle Notes | December 31, 2021 | December 31, 2020 | |||||||||
4.125% Senior Notes |
$ | — | $ | 276 | ||||||||
612 | |||||||||||
$ | — | $ | 888 |
(In millions) | Outstanding Principal | ||||||
European Vehicle Notes | December 31, 2019 | December 31, 2018 | |||||
4.125% Senior Notes due October 2021 | $ | 251 | $ | 257 | |||
5.500% Senior Notes due March 2023 | 559 | 572 | |||||
$ | 810 | $ | 829 |
(In millions) | Aggregate Principal Amount | |||
HVF II Series 2018-1 Class D Notes | $ | 58 | ||
HVF II Series 2018-2 Class D Notes | 13 | |||
HVF II Series 2018-3 Class D Notes | 13 | |||
HVF II Series 2019-1 Class D Notes | 45 | |||
HVF II Series 2019-2 Class D Notes | 49 | |||
Total | $ | 178 |
Years Ended December 31, | ||||||||||||||||||||
Redemption/Termination (in millions) | 2021 | 2020 | 2019 | |||||||||||||||||
Non-Vehicle Debt | ||||||||||||||||||||
HIL Credit Agreement(1) | $ | 8 | $ | — | $ | — | ||||||||||||||
Second HIL Credit Agreement | 5 | — | — | |||||||||||||||||
Total Non-Vehicle Debt | 13 | — | — | |||||||||||||||||
Non-Vehicle Debt (subject to compromise) | ||||||||||||||||||||
Senior Term Loan | 16 | — | — | |||||||||||||||||
Senior RCF | 22 | — | — | |||||||||||||||||
Senior Notes | 29 | — | — | |||||||||||||||||
Senior Second Priority Secured Notes(2) | 4 | — | 39 | |||||||||||||||||
Promissory Notes | 2 | — | — | |||||||||||||||||
Alternative Letter of Credit Facility | 7 | — | — | |||||||||||||||||
Letter of Credit Facility | 8 | — | — | |||||||||||||||||
5.875% Senior Notes due 2020(2) | — | — | 2 | |||||||||||||||||
7.375% Senior Notes due 2021(2) | — | — | 2 | |||||||||||||||||
Total Non-Vehicle Debt (subject to compromise) | 88 | — | 43 | |||||||||||||||||
Vehicle Debt | ||||||||||||||||||||
HVF II U.S. Vehicle Variable Funding Notes | 9 | — | — | |||||||||||||||||
HVF II U.S. Vehicle Medium Term Notes | 39 | — | — | |||||||||||||||||
HVIF II Series 2020-1 | 21 | — | — | |||||||||||||||||
European Vehicle Notes | 29 | — | — | |||||||||||||||||
European ABS(3) | — | 5 | — | |||||||||||||||||
Total Vehicle Debt | 98 | 5 | — | |||||||||||||||||
Total Loss on Extinguishment of Debt | $ | 199 | $ | 5 | $ | 43 |
Years Ended December 31, | ||||||||||||
Redemption/Termination (In millions) | 2019 | 2018 | 2017 | |||||||||
Non-Vehicle Debt: | ||||||||||||
Senior RCF | $ | — | $ | — | $ | 7 | ||||||
4.250% Senior Notes due 2018 | — | — | 6 | |||||||||
5.875% Senior Notes due 2020 | 2 | — | — | |||||||||
7.375% Senior Notes due 2021 | 2 | — | — | |||||||||
7.625% Senior Second Priority Secured Notes due 2022 | 39 | — | — | |||||||||
Total Non-Vehicle Debt | 43 | — | 13 | |||||||||
Vehicle Debt: | ||||||||||||
HVF II Series 2017-A | — | 2 | — | |||||||||
4.375% European Vehicle Notes due 2019 | — | 20 | — | |||||||||
Total Vehicle Debt | — | 22 | — | |||||||||
Total Loss on Extinguishment of Debt | $ | 43 | $ | 22 | $ | 13 |
(In millions) | 2022 | 2023 | 2024 | 2025 | 2026 | After 2026 | |||||||||||||||||||||||||||||
Non-Vehicle Debt | $ | 20 | $ | 20 | $ | 15 | $ | 13 | $ | 513 | $ | 2,474 | |||||||||||||||||||||||
Vehicle Debt | 311 | 3,617 | 2,026 | — | 2,000 | — | |||||||||||||||||||||||||||||
Total | $ | 331 | $ | 3,637 | $ | 2,041 | $ | 13 | $ | 2,513 | $ | 2,474 |
(In millions) | 2020 | 2021 | 2022 | 2023 | 2024 | After 2024 | |||||||||||||||||
Non-Vehicle Debt | $ | 20 | $ | 19 | $ | 868 | $ | 620 | $ | 801 | $ | 1,427 | |||||||||||
Vehicle Debt | 2,418 | 6,275 | 1,413 | 1,759 | 1,550 | — | |||||||||||||||||
Total | $ | 2,438 | $ | 6,294 | $ | 2,281 | $ | 2,379 | $ | 2,351 | $ | 1,427 |
(In millions) | Remaining Capacity | Availability Under Borrowing Base Limitation | |||||||||
Non-Vehicle Debt | |||||||||||
First Lien RCF | $ | 925 | $ | 925 | |||||||
Total Non-Vehicle Debt | 925 | 925 | |||||||||
Vehicle Debt | |||||||||||
HVF III Series 2021-A | — | — | |||||||||
European ABS | 456 | — | |||||||||
Hertz Canadian Securitization | 82 | — | |||||||||
Australian Securitization | 24 | — | |||||||||
U.K. Financing Facility | 37 | — | |||||||||
U.K. Toyota Financing Facility | 5 | — | |||||||||
New Zealand RCF | 2 | — | |||||||||
Total Vehicle Debt | 606 | — | |||||||||
Total | $ | 1,531 | $ | 925 |
(In millions) | Remaining Capacity | Availability Under Borrowing Base Limitation | |||||
Non-Vehicle Debt | |||||||
Senior RCF | $ | 526 | $ | 526 | |||
Letter of Credit Facility | 5 | 5 | |||||
Alternative Letter of Credit Facility | — | — | |||||
Total Non-Vehicle Debt | 531 | 531 | |||||
Vehicle Debt | |||||||
U.S. Vehicle RCF | — | — | |||||
HVF II U.S. Vehicle Variable Funding Notes | 1,461 | — | |||||
HFLF Variable Funding Notes | 214 | 4 | |||||
European ABS | 464 | — | |||||
Hertz Canadian Securitization | 27 | — | |||||
Donlen Canadian Securitization | 14 | — | |||||
Australian Securitization | 11 | — | |||||
U.K. Financing Facility | 80 | — | |||||
New Zealand RCF | — | — | |||||
Total Vehicle Debt | 2,271 | 4 | |||||
Total | $ | 2,802 | $ | 535 |
Year Ended December 31, 2018 | |||||||||||||||
(In millions) | U.S. Rental Car | International Rental Car | All Other Operations | Consolidated | |||||||||||
Vehicle rental and rental related: | |||||||||||||||
Airport | $ | 4,465 | $ | 1,288 | $ | — | $ | 5,753 | |||||||
Off airport | 1,881 | 842 | — | 2,723 | |||||||||||
Total vehicle rental and rental related | 6,346 | 2,130 | — | 8,476 | |||||||||||
Other: | |||||||||||||||
Licensee revenue | 32 | 145 | — | 177 | |||||||||||
Ancillary retail vehicle sales | 102 | 1 | — | 103 | |||||||||||
Fleet management | — | — | 45 | 45 | |||||||||||
Total other | 134 | 146 | 45 | 325 | |||||||||||
Total revenue from contracts with customers | $ | 6,480 | $ | 2,276 | $ | 45 | $ | 8,801 |
Pension Benefits | Postretirement | ||||||||||||||||||||||||||||||||||
U.S. | Non-U.S. | Benefits (U.S.) | |||||||||||||||||||||||||||||||||
(In millions) | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||||||
Change in Benefit Obligation | |||||||||||||||||||||||||||||||||||
Benefit obligation as of January 1 | $ | 522 | $ | 559 | $ | 340 | $ | 286 | $ | 12 | $ | 12 | |||||||||||||||||||||||
Service cost | — | — | 1 | 1 | — | — | |||||||||||||||||||||||||||||
Interest cost | 12 | 15 | 4 | 5 | 1 | — | |||||||||||||||||||||||||||||
Plan curtailments | — | (2) | — | — | — | — | |||||||||||||||||||||||||||||
Plan settlements | (26) | (88) | (6) | (5) | — | — | |||||||||||||||||||||||||||||
Benefits paid | (27) | (3) | (5) | (6) | (1) | (1) | |||||||||||||||||||||||||||||
Foreign currency exchange rate translation | — | — | (7) | 17 | — | — | |||||||||||||||||||||||||||||
Actuarial (gain) loss | (16) | 41 | (20) | 42 | — | 1 | |||||||||||||||||||||||||||||
Benefit obligation as of December 31(1) | $ | 465 | $ | 522 | $ | 307 | $ | 340 | $ | 12 | $ | 12 | |||||||||||||||||||||||
Change in Plan Assets | |||||||||||||||||||||||||||||||||||
Fair value of plan assets as of January 1 | $ | 488 | $ | 503 | $ | 258 | $ | 228 | $ | — | $ | — | |||||||||||||||||||||||
Actual return gain on plan assets | 9 | 74 | 4 | 28 | — | — | |||||||||||||||||||||||||||||
Company contributions | 24 | 2 | 5 | 4 | 1 | 1 | |||||||||||||||||||||||||||||
Plan settlements | (26) | (88) | (6) | (5) | — | — | |||||||||||||||||||||||||||||
Benefits paid | (27) | (3) | (5) | (6) | (1) | (1) | |||||||||||||||||||||||||||||
Foreign currency exchange rate translation | — | — | (1) | 9 | — | — | |||||||||||||||||||||||||||||
Fair value of plan assets as of December 31 | $ | 468 | $ | 488 | $ | 255 | $ | 258 | $ | — | $ | — | |||||||||||||||||||||||
Funded Status of the Plan | |||||||||||||||||||||||||||||||||||
Plan assets less than benefit obligation | $ | 3 | $ | (34) | $ | (52) | $ | (82) | $ | (12) | $ | (12) |
Pension Benefits | Postretirement | ||||||||||||||||||||||
U.S. | Non-U.S. | Benefits (U.S.) | |||||||||||||||||||||
(In millions) | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||||
Change in Benefit Obligation | |||||||||||||||||||||||
Benefit obligation as of January 1 | $ | 516 | $ | 555 | $ | 246 | $ | 279 | $ | 12 | $ | 14 | |||||||||||
Service cost | — | 1 | 1 | 1 | — | — | |||||||||||||||||
Interest cost | 21 | 19 | 6 | 7 | — | 1 | |||||||||||||||||
Plan amendments | — | — | — | 1 | — | — | |||||||||||||||||
Plan settlements | (33 | ) | (31 | ) | — | — | — | — | |||||||||||||||
Benefits paid | (4 | ) | (4 | ) | (5 | ) | (6 | ) | (1 | ) | (1 | ) | |||||||||||
Foreign currency exchange rate translation | — | — | 5 | (13 | ) | — | — | ||||||||||||||||
Actuarial loss (gain) | 59 | (23 | ) | 33 | (23 | ) | 1 | (2 | ) | ||||||||||||||
Transfers in connection with the Spin-Off | — | (1 | ) | — | — | — | — | ||||||||||||||||
Benefit obligation as of December 31 | $ | 559 | $ | 516 | $ | 286 | $ | 246 | $ | 12 | $ | 12 | |||||||||||
Change in Plan Assets | |||||||||||||||||||||||
Fair value of plan assets as of January 1 | $ | 452 | $ | 526 | $ | 192 | $ | 217 | $ | — | $ | — | |||||||||||
Actual return (loss) gain on plan assets | 84 | (42 | ) | 29 | (12 | ) | — | — | |||||||||||||||
Company contributions | 4 | 5 | 5 | 4 | 1 | 1 | |||||||||||||||||
Plan settlements | (33 | ) | (31 | ) | — | — | — | — | |||||||||||||||
Benefits paid | (4 | ) | (4 | ) | (5 | ) | (6 | ) | (1 | ) | (1 | ) | |||||||||||
Foreign currency exchange rate translation | — | — | 7 | (11 | ) | — | — | ||||||||||||||||
Amounts associated with the Spin-Off | — | (2 | ) | — | — | — | — | ||||||||||||||||
Fair value of plan assets as of December 31 | $ | 503 | $ | 452 | $ | 228 | $ | 192 | $ | — | $ | — | |||||||||||
Funded Status of the Plan | |||||||||||||||||||||||
Plan assets less than benefit obligation | $ | (56 | ) | $ | (64 | ) | $ | (58 | ) | $ | (54 | ) | $ | (12 | ) | $ | (12 | ) |
Pension Benefits | Postretirement | ||||||||||||||||||||||
U.S. | Non-U.S. | Benefits (U.S.) | |||||||||||||||||||||
($ in millions) | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||||
Amounts recognized in balance sheets: | |||||||||||||||||||||||
Prepaid expenses and other assets | $ | — | $ | — | $ | 25 | $ | 21 | $ | — | $ | — | |||||||||||
Accrued liabilities | (56 | ) | (64 | ) | (83 | ) | (75 | ) | (12 | ) | (12 | ) | |||||||||||
Net obligation recognized in the balance sheets | $ | (56 | ) | $ | (64 | ) | $ | (58 | ) | $ | (54 | ) | $ | (12 | ) | $ | (12 | ) | |||||
Prior service credit | $ | — | $ | — | $ | (2 | ) | $ | (1 | ) | $ | — | $ | — | |||||||||
Net gain (loss) | (73 | ) | (87 | ) | (70 | ) | (58 | ) | 1 | 1 | |||||||||||||
Accumulated other comprehensive income (loss) | (73 | ) | (87 | ) | (72 | ) | (59 | ) | 1 | 1 | |||||||||||||
Funded/(Unfunded) accrued pension or postretirement benefit | 17 | 23 | 14 | 5 | (13 | ) | (13 | ) | |||||||||||||||
Net obligation recognized in the balance sheets | $ | (56 | ) | $ | (64 | ) | $ | (58 | ) | $ | (54 | ) | $ | (12 | ) | $ | (12 | ) | |||||
Total recognized in other comprehensive (income) loss | $ | (13 | ) | $ | 44 | $ | 13 | $ | (2 | ) | $ | 1 | $ | (2 | ) | ||||||||
Total recognized in net periodic benefit cost and other comprehensive (income) loss | $ | (3 | ) | $ | 40 | $ | 12 | $ | (5 | ) | $ | 1 | $ | (1 | ) | ||||||||
Accumulated Benefit Obligation as of December 31 | $ | 559 | $ | 516 | $ | 284 | $ | 245 | N/A | N/A | |||||||||||||
Weighted-average assumptions as of December 31 | |||||||||||||||||||||||
Discount rate | 3.1 | % | 4.2 | % | 1.9 | % | 2.7 | % | 3.2 | % | 4.2 | % | |||||||||||
Expected return on assets | 4.8 | % | 6.3 | % | 3.2 | % | 4.9 | % | N/A | N/A | |||||||||||||
Average rate of increase in compensation | 4.3 | % | 4.3 | % | 2.2 | % | 2.8 | % | N/A | N/A | |||||||||||||
Interest crediting rate | 3.8 | % | 3.8 | % | N/A | N/A | N/A | N/A | |||||||||||||||
Initial health care cost trend rate | N/A | N/A | N/A | N/A | 5.8 | % | 6.1 | % | |||||||||||||||
Ultimate health care cost trend rate | N/A | N/A | N/A | N/A | 4.5 | % | 4.5 | % | |||||||||||||||
Number of years to ultimate trend rate | N/A | N/A | N/A | N/A | 19 | 20 |
Pension Benefits | Postretirement | ||||||||||||||||||||||||||||||||||
U.S. | Non-U.S. | Benefits (U.S.) | |||||||||||||||||||||||||||||||||
($ in millions) | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||||||
Amounts recognized in balance sheets: | |||||||||||||||||||||||||||||||||||
Prepaid expenses and other assets | $ | 3 | $ | — | $ | 30 | $ | 14 | $ | — | $ | — | |||||||||||||||||||||||
Accrued liabilities | — | (34) | (82) | (96) | (12) | (12) | |||||||||||||||||||||||||||||
Net obligation recognized in the balance sheets | $ | 3 | $ | (34) | $ | (52) | $ | (82) | $ | (12) | $ | (12) | |||||||||||||||||||||||
Prior service credit | $ | — | $ | — | $ | (2) | $ | (2) | $ | — | $ | — | |||||||||||||||||||||||
Net gain (loss) | (28) | (47) | (72) | (93) | — | (1) | |||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | (28) | (47) | (74) | (95) | — | (1) | |||||||||||||||||||||||||||||
Funded/(Unfunded) accrued pension or postretirement benefit | 31 | 13 | 22 | 13 | (12) | (11) | |||||||||||||||||||||||||||||
Net obligation recognized in the balance sheets | $ | 3 | $ | (34) | $ | (52) | $ | (82) | $ | (12) | $ | (12) | |||||||||||||||||||||||
Total recognized in other comprehensive (income) loss | $ | (20) | $ | (26) | $ | (21) | $ | 23 | $ | (1) | $ | 1 | |||||||||||||||||||||||
Total recognized in net periodic benefit cost and other comprehensive (income) loss | $ | (14) | $ | (20) | $ | (20) | $ | 25 | $ | (1) | $ | 1 | |||||||||||||||||||||||
Accumulated Benefit Obligation as of December 31(1) | $ | 465 | $ | 522 | $ | 306 | $ | 338 | N/A | N/A | |||||||||||||||||||||||||
Weighted-average assumptions as of December 31 | |||||||||||||||||||||||||||||||||||
Discount rate | 2.7 | % | 2.3 | % | 1.7 | % | 1.4 | % | 2.2 | % | 2.3 | % | |||||||||||||||||||||||
Expected return on assets | 4.5 | % | 4.5 | % | 3.0 | % | 3.0 | % | N/A | N/A | |||||||||||||||||||||||||
Average rate of increase in compensation | 4.3 | % | 4.3 | % | 2.1 | % | 2.1 | % | N/A | N/A | |||||||||||||||||||||||||
Interest crediting rate | 3.8 | % | 3.8 | % | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||
Initial health care cost trend rate | N/A | N/A | N/A | N/A | 5.6 | % | 5.5 | % | |||||||||||||||||||||||||||
Ultimate health care cost trend rate | N/A | N/A | N/A | N/A | 4.0 | % | 4.5 | % | |||||||||||||||||||||||||||
Number of years to ultimate trend rate | N/A | N/A | N/A | N/A | 25 | 18 |
Pension Benefits | Postretirement Benefits (U.S.) | ||||||||||||||||||||||||||||||||||
U.S. | Non-U.S. | ||||||||||||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||||||||||||
($ in millions) | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | ||||||||||||||||||||||||||
Components of Net Periodic Pension and Postretirement Expense (Benefit) | |||||||||||||||||||||||||||||||||||
Service cost | $ | — | $ | 1 | $ | 1 | $ | 1 | $ | 1 | $ | 1 | $ | — | $ | — | $ | — | |||||||||||||||||
Interest cost | 21 | 19 | 21 | 6 | 7 | 6 | — | 1 | 1 | ||||||||||||||||||||||||||
Expected return on plan assets | (22 | ) | (28 | ) | (26 | ) | (9 | ) | (11 | ) | (10 | ) | — | — | — | ||||||||||||||||||||
Net amortizations | 6 | 1 | 3 | 1 | 1 | 2 | — | — | — | ||||||||||||||||||||||||||
Settlement loss | 5 | 3 | 1 | — | — | — | — | — | — | ||||||||||||||||||||||||||
Net pension and postretirement expense (benefit) | $ | 10 | $ | (4 | ) | $ | — | $ | (1 | ) | $ | (2 | ) | $ | (1 | ) | $ | — | $ | 1 | $ | 1 | |||||||||||||
Weighted-average discount rate for expense (January 1) | 4.2 | % | 3.6 | % | 4.0 | % | 2.7 | % | 2.4 | % | 2.5 | % | 4.2 | % | 3.5 | % | 3.9 | % | |||||||||||||||||
Weighted-average assumed long-term rate of return on assets (January 1) | 6.3 | % | 6.3 | % | 7.0 | % | 4.8 | % | 5.2 | % | 5.2 | % | N/A | N/A | N/A | ||||||||||||||||||||
Weighted-average interest crediting rate for expense | 3.8 | % | 3.8 | % | 3.8 | % | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Initial health care cost trend rate | N/A | N/A | N/A | N/A | N/A | N/A | 6.1 | % | 6.4 | % | 6.7 | % | |||||||||||||||||||||||
Ultimate health care cost trend rate (rate to which cost trend is expected to decline) | N/A | N/A | N/A | N/A | N/A | N/A | 4.5 | % | 4.5 | % | 4.5 | % | |||||||||||||||||||||||
Number of years to ultimate trend rate | N/A | N/A | N/A | N/A | N/A | N/A | 19 | 20 | 21 |
Pension Benefits | Postretirement Benefits (U.S.) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. | Non-U.S. | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||||||||||
($ in millions) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | ||||||||||||||||||||||||||||||||||||||||||||
Components of Net Periodic Pension and Postretirement Expense (Benefit) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Service cost | $ | — | $ | — | $ | — | $ | 1 | $ | 1 | $ | 1 | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||||
Interest cost | 12 | 15 | 21 | 4 | 5 | 6 | 1 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Expected return on plan assets | (18) | (20) | (22) | (7) | (7) | (9) | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Net amortizations | — | 2 | 6 | 2 | 1 | 1 | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Settlement loss | 12 | 9 | 5 | 1 | 2 | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Net pension and postretirement expense (benefit) | $ | 6 | $ | 6 | $ | 10 | $ | 1 | $ | 2 | $ | (1) | $ | 1 | $ | — | $ | — | |||||||||||||||||||||||||||||||||||
Weighted-average discount rate for expense (January 1) | 2.2 | % | 3.1 | % | 4.2 | % | 1.4 | % | 1.9 | % | 2.7 | % | 1.9 | % | 3.2 | % | 4.2 | % | |||||||||||||||||||||||||||||||||||
Weighted-average assumed long-term rate of return on assets (January 1) | 4.5 | % | 4.8 | % | 6.3 | % | 3.0 | % | 3.2 | % | 4.8 | % | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Weighted-average interest crediting rate for expense | 3.8 | % | 3.8 | % | 3.8 | % | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||||||||||
Initial health care cost trend rate | N/A | N/A | N/A | N/A | N/A | N/A | 5.5 | % | 5.8 | % | 6.1 | % | |||||||||||||||||||||||||||||||||||||||||
Ultimate health care cost trend rate (rate to which cost trend is expected to decline) | N/A | N/A | N/A | N/A | N/A | N/A | 4.5 | % | 4.5 | % | 4.5 | % | |||||||||||||||||||||||||||||||||||||||||
Number of years to ultimate trend rate | N/A | N/A | N/A | N/A | N/A | N/A | 25 | 18 | 19 |
(In millions) | December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||||
Asset Category | Level 1 | Level 2 | Measured at NAV(1) | Level 1 | Level 2 | Measured at NAV(1) | |||||||||||||||||||||||||||||
Cash | $ | 5 | $ | — | $ | — | $ | 6 | $ | — | $ | — | |||||||||||||||||||||||
Short Term Investments | — | 27 | — | — | 28 | — | |||||||||||||||||||||||||||||
Equity Funds(2): | |||||||||||||||||||||||||||||||||||
U.S. Large Cap | — | 59 | — | — | 66 | — | |||||||||||||||||||||||||||||
U.S. Small Cap | — | 7 | — | — | 11 | — | |||||||||||||||||||||||||||||
International Large Cap | — | 28 | — | — | 36 | — | |||||||||||||||||||||||||||||
International Small Cap | — | 5 | — | — | 7 | — | |||||||||||||||||||||||||||||
International Emerging Markets | — | 6 | 6 | — | 6 | 9 | |||||||||||||||||||||||||||||
Fixed Income Securities: | |||||||||||||||||||||||||||||||||||
U.S. Treasuries | — | 24 | — | — | 18 | — | |||||||||||||||||||||||||||||
Corporate Bonds | — | 247 | — | — | 245 | — | |||||||||||||||||||||||||||||
Government Bonds | — | 12 | — | — | 9 | — | |||||||||||||||||||||||||||||
Municipal Bonds | — | 10 | — | — | 10 | — | |||||||||||||||||||||||||||||
Derivatives - Interest Rate | 3 | 2 | — | 3 | — | — | |||||||||||||||||||||||||||||
Non-Investment Grade Fixed Income(2) | — | 27 | — | — | 34 | — | |||||||||||||||||||||||||||||
Total fair value of pension plan assets | $ | 8 | $ | 454 | $ | 6 | $ | 9 | $ | 470 | $ | 9 |
(In millions) | December 31, 2019 | December 31, 2018 | |||||||||||||||||
Asset Category | Level 1 | Level 2 | Measured at NAV(1) | Level 1 | Level 2 | ||||||||||||||
Cash | $ | 10 | $ | — | $ | — | $ | 1 | $ | — | |||||||||
Short Term Investments | — | 36 | — | — | 3 | ||||||||||||||
Equity Funds: | |||||||||||||||||||
U.S. Large Cap | — | 70 | — | — | 121 | ||||||||||||||
U.S. Mid Cap | — | — | — | — | 34 | ||||||||||||||
U.S. Small Cap | — | 10 | — | — | 27 | ||||||||||||||
International Large Cap | — | 38 | — | — | 76 | ||||||||||||||
International Small Cap | — | 7 | — | — | — | ||||||||||||||
International Emerging Markets | — | 8 | 8 | — | 23 | ||||||||||||||
Asset-Backed Securities | — | — | — | — | 8 | ||||||||||||||
Fixed Income Securities: | |||||||||||||||||||
U.S. Treasuries | — | 1 | — | — | 51 | ||||||||||||||
Corporate Bonds | — | 247 | — | — | 82 | ||||||||||||||
Government Bonds | — | 24 | — | — | 8 | ||||||||||||||
Municipal Bonds | — | 11 | — | — | 11 | ||||||||||||||
Real Estate (REITs) | — | — | — | — | 7 | ||||||||||||||
Derivatives - Interest Rate | (3 | ) | — | — | — | — | |||||||||||||
Derivatives - Credit | — | 1 | — | — | — | ||||||||||||||
Non-Investment Grade Fixed Income | — | 35 | — | — | — | ||||||||||||||
Total fair value of pension plan assets | $ | 7 | $ | 488 | $ | 8 | $ | 1 | $ | 451 |
(In millions) | December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||||
Asset Category | Level 1 | Level 2 | Measured at NAV(1) | Level 1 | Level 2 | Measured at NAV(1) | |||||||||||||||||||||||||||||
Actively Managed Multi-Asset Funds: | |||||||||||||||||||||||||||||||||||
Diversified Growth Funds(2) | $ | — | $ | 37 | $ | — | $ | — | $ | 39 | $ | — | |||||||||||||||||||||||
Multi Asset Credit | — | — | 38 | — | — | 37 | |||||||||||||||||||||||||||||
Passive Equity Funds: | |||||||||||||||||||||||||||||||||||
U.K. Equities(2) | — | 12 | — | — | 12 | — | |||||||||||||||||||||||||||||
Overseas Equities(2) | — | 14 | — | — | 14 | — | |||||||||||||||||||||||||||||
Passive Bond Funds: | |||||||||||||||||||||||||||||||||||
Corporate Bonds | — | 27 | — | — | 27 | — | |||||||||||||||||||||||||||||
Liability Driven Investments(2) | — | 96 | — | — | 98 | — | |||||||||||||||||||||||||||||
Liquidity Fund | 24 | — | — | 24 | — | — | |||||||||||||||||||||||||||||
Total fair value of pension plan assets | $ | 24 | $ | 186 | $ | 38 | $ | 24 | $ | 190 | $ | 37 |
(In millions) | December 31, 2019 | December 31, 2018 | |||||||||||||||||||||
Asset Category | Level 1 | Level 2 | Measured at NAV(1) | Level 1 | Level 2 | Measured at NAV(1) | |||||||||||||||||
Actively Managed Multi-Asset Funds: | |||||||||||||||||||||||
Diversified Growth Funds | $ | — | $ | 42 | $ | — | $ | — | $ | 36 | $ | — | |||||||||||
Multi Asset Credit | — | — | 36 | — | — | 32 | |||||||||||||||||
Passive Equity Funds: | |||||||||||||||||||||||
U.K. Equities | — | 11 | — | — | 23 | — | |||||||||||||||||
Overseas Equities | — | 14 | — | — | 28 | — | |||||||||||||||||
Passive Bond Funds: | |||||||||||||||||||||||
Corporate Bonds | — | 24 | — | — | 21 | — | |||||||||||||||||
Liability Driven Investments | — | 48 | — | — | 35 | — | |||||||||||||||||
Liquidity Fund | 46 | — | — | 11 | — | — | |||||||||||||||||
Total fair value of pension plan assets | $ | 46 | $ | 139 | $ | 36 | $ | 11 | $ | 143 | $ | 32 |
(In millions) | Pension Benefits | Postretirement Benefits (U.S.) | |||||||||
2022 | $ | 33 | $ | 3 | |||||||
2023 | 33 | 1 | |||||||||
2024 | 35 | 1 | |||||||||
2025 | 36 | 1 | |||||||||
2026 | 39 | 1 | |||||||||
2027 to 2031 | 206 | 3 | |||||||||
$ | 382 | $ | 10 |
(In millions) | Pension Benefits | Postretirement Benefits (U.S.) | |||||
2020 | $ | 44 | $ | 1 | |||
2021 | 41 | 1 | |||||
2022 | 43 | 1 | |||||
2023 | 45 | 1 | |||||
2024 | 46 | 1 | |||||
After 2024 | 237 | 5 | |||||
$ | 456 | $ | 10 |
a) Assets contributed to a multiemployer plan by one employer may be used to provide benefits to employees of other participating employers. |
EIN /Pension Plan Number | Pension Protection Act Zone Status | FIP / RP Status Pending /Implemented(1) | Contributions by The Hertz Corporation (In millions) | Surcharge Imposed | Expiration Dates of Collective Bargaining Agreements | ||||||||||||||||||||||||||||||||||||||||||||||||
Pension Fund | 2021 | 2020 | 2021 | 2020 | 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||
Western Conference of Teamsters | 91-6145047 | Green | Green | N/A | $ | 4 | $ | 5 | $ | 8 | N/A | 2/28/2022 | |||||||||||||||||||||||||||||||||||||||||
Other Plans | 1 | 2 | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total Contributions | $ | 5 | $ | 7 | $ | 12 |
EIN /Pension Plan Number | Pension Protection Act Zone Status | FIP / RP Status Pending /Implemented(1) | Contributions by The Hertz Corporation (In millions) | Surcharge Imposed | Expiration Dates of Collective Bargaining Agreements | ||||||||||||||||||
Pension Fund | 2019 | 2018 | 2019 | 2018 | 2017 | ||||||||||||||||||
Western Conference of Teamsters | 91-6145047 | Green | Green | N/A | $ | 8 | $ | 7 | $ | 6 | N/A | 10/1/2020 | |||||||||||
Other Plans(2) | 4 | 3 | 4 | ||||||||||||||||||||
Total Contributions | $ | 12 | $ | 10 | $ | 10 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Compensation expense | $ | 18 | $ | 14 | $ | 19 | |||||
Income tax benefit | (2 | ) | (3 | ) | (8 | ) | |||||
Total | $ | 16 | $ | 11 | $ | 11 |
Grants | |||||||||||
Assumption | 2019(1) | 2018 | 2017 | ||||||||
Expected volatility | 68.5 | % | 56.7 | % | 47.8 | % | |||||
Expected dividend yield | — | % | — | % | — | % | |||||
Expected term (years) | 7 | 5 | 7 | ||||||||
Risk-free interest rate | 1.93 | % | 2.57 | % | 1.95 | % | |||||
Weighted-average grant date fair value | $ | 9.19 | $ | 8.92 | $ | 9.44 |
Assumption | 2021 | ||||||||||||||||
Expected volatility | 75 | % | |||||||||||||||
Expected dividend yield | — | % | |||||||||||||||
Expected term (years) | 6 | ||||||||||||||||
Risk-free interest rate | 1.19 | % | |||||||||||||||
Weighted-average grant date fair value | $ | 17.12 |
Options | Shares | Weighted Average Exercise Price | Weighted- Average Remaining Contractual Term (years) | Aggregate Intrinsic Value (In millions) | |||||||||||||||||||
Outstanding as of January 1, 2021 | — | $ | — | — | $ | — | |||||||||||||||||
Granted | 3,682,215 | 26.17 | — | — | |||||||||||||||||||
Exercised | — | — | — | — | |||||||||||||||||||
Forfeited or Expired | (3,360) | 26.17 | — | — | |||||||||||||||||||
Outstanding as of December 31, 2021 | 3,678,855 | 26.17 | 9.9 | — | |||||||||||||||||||
Exercisable as of December 31, 2021 | — | — | — | — | |||||||||||||||||||
Non-vested as of December 31, 2021 | 3,678,855 |
Options | Shares | Weighted Average Exercise Price | Weighted- Average Remaining Contractual Term (years) | Aggregate Intrinsic Value (In millions) | |||||||||
Outstanding as of January 1, 2019 | 1,170,318 | $ | 30.44 | 4.8 | $ | — | |||||||
Granted(1) | 80,593 | 29.58 | — | — | |||||||||
Exercised | (599 | ) | 12.84 | — | — | ||||||||
Forfeited or Expired | (194,358 | ) | 41.42 | — | — | ||||||||
Outstanding as of December 31, 2019 | 1,055,954 | 28.36 | 4.0 | — | |||||||||
Exercisable as of December 31, 2019 | 578,516 | 36.66 | 3.0 | — |
Non-vested Shares | Weighted- Average Exercise Price | Weighted-Average Grant-Date Fair Value | ||||||||
Non-vested as of January 1, 2019 | 929,693 | $ | 22.20 | $ | 9.92 | |||||
Granted | 80,593 | 29.58 | 9.19 | |||||||
Vested | (461,079 | ) | 27.92 | 10.52 | ||||||
Forfeited | (71,769 | ) | 19.57 | 8.94 | ||||||
Non-vested as of December 31, 2019 | 477,438 | 18.31 | 9.35 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Aggregate intrinsic value of stock options exercised | $ | — | $ | — | $ | — | |||||
Cash received from the exercise of stock options | — | — | — | ||||||||
Fair value of options that vested | 5 | 3 | 3 | ||||||||
Tax benefit realized on exercise of stock options | — | — | — |
Shares | Weighted- Average Fair Value | Aggregate Intrinsic Value (In millions) | ||||||||
Outstanding as of January 1, 2019 | 1,567,126 | $ | 21.61 | $ | 12 | |||||
Granted(1) | 1,295,113 | 19.05 | — | |||||||
Vested | (94,686 | ) | 30.59 | — | ||||||
Forfeited or Expired | (519,910 | ) | 24.55 | — | ||||||
Outstanding as of December 31, 2019 | 2,247,643 | 19.08 | 21 |
Shares | Weighted- Average Fair Value | Aggregate Intrinsic Value (In millions) | ||||||||
Outstanding as of January 1, 2019 | 1,122,233 | $ | 20.11 | $ | 15 | |||||
Granted(1) | 677,479 | 18.66 | — | |||||||
Vested | (536,802 | ) | 22.00 | — | ||||||
Forfeited or Expired | (218,641 | ) | 18.81 | — | ||||||
Outstanding as of December 31, 2019 | 1,044,269 | 18.43 | 16 |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Total fair value of awards that vested (In millions) | $ | 12 | $ | 5 | $ | 6 | |||||
Weighted-average grant date fair value of awards | 18.66 | 17.40 | 19.27 |
Shares | Weighted- Average Fair Value | Aggregate Intrinsic Value (In millions) | |||||||||||||||
Outstanding as of January 1, 2021 | — | $ | — | $ | — | ||||||||||||
Granted | 1,727,406 | 26.17 | — | ||||||||||||||
Vested | — | — | — | ||||||||||||||
Forfeited or Expired | (1,120) | 26.17 | — | ||||||||||||||
Outstanding as of December 31, 2021 | 1,726,286 | 26.17 | 43 |
Years Ended December 31, | |||||||||||||||||
2021 | |||||||||||||||||
Total fair value of awards that vested (in millions) | $ | — | |||||||||||||||
Weighted-average grant-date fair value of awards | 26.17 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Compensation expense (credit) | $ | 3 | $ | (2) | $ | 18 | |||||||||||
Income tax provision (benefit) | (1) | — | (2) | ||||||||||||||
Total | $ | 2 | $ | (2) | $ | 16 |
Grants | |||||||||||||||||
Assumption | 2021(1) | 2020(1) | 2019(2) | ||||||||||||||
Expected volatility | — | % | — | % | 68.5 | % | |||||||||||
Expected dividend yield | — | % | — | % | — | % | |||||||||||
Expected term (years) | 0 | 0 | 7 | ||||||||||||||
Risk-free interest rate | — | % | — | % | 1.93 | % | |||||||||||
Weighted-average grant date fair value | $ | — | $ | — | $ | 9.19 |
Options | Shares | Weighted Average Exercise Price | Weighted- Average Remaining Contractual Term (years) | Aggregate Intrinsic Value (In millions) | |||||||||||||||||||
Outstanding as of January 1, 2021 | 99,038 | $ | 34.76 | 2.3 | $ | — | |||||||||||||||||
Granted | — | — | — | — | |||||||||||||||||||
Exercised | — | — | — | — | |||||||||||||||||||
Forfeited or Expired(1) | (99,038) | 34.76 | — | — | |||||||||||||||||||
Outstanding as of December 31, 2021 | — | — | — | — | |||||||||||||||||||
Exercisable as of December 31, 2021 | — | — | — | — |
Non-vested Shares | Weighted- Average Exercise Price | Weighted-Average Grant-Date Fair Value | |||||||||||||||
Non-vested as of January 1, 2021 | 23,249 | $ | 18.07 | $ | 9.06 | ||||||||||||
Granted | — | — | — | ||||||||||||||
Vested | — | — | — | ||||||||||||||
Forfeited or expired(1) | (23,249) | 18.07 | 9.06 | ||||||||||||||
Non-vested as of December 31, 2021 | — | — | — |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Aggregate intrinsic value of stock options exercised | $ | — | $ | — | $ | — | |||||||||||
Cash received from the exercise of stock options | — | — | — | ||||||||||||||
Fair value of options that vested | — | — | 5 | ||||||||||||||
Tax benefit realized on exercise of stock options | — | — | — |
Shares | Weighted- Average Fair Value | Aggregate Intrinsic Value (In millions) | |||||||||||||||
Outstanding as of January 1, 2021 | 1,813,305 | $ | 16.47 | $ | 2 | ||||||||||||
Granted | — | — | — | ||||||||||||||
Vested | — | — | — | ||||||||||||||
Forfeited or Expired(1) | (1,813,305) | 16.47 | — | ||||||||||||||
Outstanding as of December 31, 2021 | — | — | — |
Shares | Weighted- Average Fair Value | Aggregate Intrinsic Value (In millions) | |||||||||||||||
Outstanding as of January 1, 2021 | 782,056 | $ | 15.11 | $ | 1 | ||||||||||||
Granted | — | — | — | ||||||||||||||
Vested | — | — | — | ||||||||||||||
Forfeited or Expired(1) | (782,056) | 15.11 | — | ||||||||||||||
Outstanding as of December 31, 2021 | — | — | — |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Total fair value of awards that vested (In millions) | $ | — | $ | 8 | $ | 12 | |||||||||||
Weighted-average grant date fair value of awards | — | 12.18 | 18.66 |
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Operating lease income from vehicle rentals | $ | 6,885 | $ | 4,320 | $ | 8,579 | |||||||||||
Operating lease income from fleet leasing | 149 | 639 | 674 | ||||||||||||||
Variable operating lease income | 131 | 30 | 164 | ||||||||||||||
Revenue accounted for under Topic 842 | 7,165 | 4,989 | 9,417 | ||||||||||||||
Revenue accounted for under Topic 606 | 171 | 269 | 362 | ||||||||||||||
Total revenues | $ | 7,336 | $ | 5,258 | $ | 9,779 |
(In millions) | 2019 | ||
Operating lease income from vehicle rentals | $ | 8,579 | |
Operating lease income from fleet leasing | 674 | ||
Variable operating lease income | 164 | ||
Revenue accounted for under Topic 842 | 9,417 | ||
Revenue accounted for under Topic 606 | 362 | ||
Total revenues | $ | 9,779 |
Years ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Minimum fixed lease costs: | |||||||||||||||||
Short-term lease costs | $ | 171 | $ | 142 | $ | 130 | |||||||||||
Operating lease costs | 449 | 527 | 545 | ||||||||||||||
Total | 620 | 669 | $ | 675 | |||||||||||||
Variable lease costs | 165 | 23 | 326 | ||||||||||||||
Total lease costs | $ | 785 | $ | 692 | $ | 1,001 |
Years ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Minimum fixed lease costs(1): | |||||||||||
Short-term lease costs | $ | 130 | N/A | N/A | |||||||
Operating lease costs | 545 | N/A | N/A | ||||||||
Total | $ | 675 | $ | 577 | $ | 515 | |||||
Variable lease costs | 326 | 438 | 430 | ||||||||
Total lease costs | $ | 1,001 | $ | 1,015 | $ | 945 |
Weighted-average remaining lease term (in years) | |||||
Weighted-average discount rate | % |
(In millions) | |||||
2022 | $ | 390 | |||
2023 | 341 | ||||
2024 | 275 | ||||
2025 | 212 | ||||
2026 | 165 | ||||
After 2026 | 1,153 | ||||
Total lease payments | 2,536 | ||||
Interest | (1,026) | ||||
Operating lease liabilities as of December 31, 2021 | $ | 1,510 |
(In millions) | ||||
2020 | $ | 494 | ||
2021 | 432 | |||
2022 | 342 | |||
2023 | 271 | |||
2024 | 209 | |||
After 2024 | 1,167 | |||
Total lease payments | 2,915 | |||
Interest | (1,067 | ) | ||
Operating lease liabilities at December 31, 2019 | $ | 1,848 |
Years ended December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
By Type: | |||||||||||
Termination benefits | $ | 27 | $ | 37 | |||||||
Lease and contract terminations | 3 | $ | — | ||||||||
Facility closures | 2 | — | |||||||||
Total | $ | 32 | $ | 37 |
Years ended December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
By Caption: | |||||||||||
Direct vehicle and operating | $ | 16 | $ | 25 | |||||||
Selling, general and administrative | 16 | 12 | |||||||||
Total | $ | 32 | $ | 37 |
Years ended December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
By Segment: | |||||||||||
Americas RAC segment | $ | — | $ | 34 | |||||||
International RAC segment | 32 | — | |||||||||
Corporate operations | — | 3 | |||||||||
Total | $ | 32 | $ | 37 |
(In millions) | Termination Benefits | Other | Total | |||||||||||||||||||||||
Balance as of December 31, 2019 | $ | 1 | $ | — | $ | 1 | ||||||||||||||||||||
Charges incurred | 37 | — | 37 | |||||||||||||||||||||||
Cash payments | (29) | — | (29) | |||||||||||||||||||||||
Classified to liabilities subject to compromise(1) | (7) | — | (7) | |||||||||||||||||||||||
Other | (2) | — | (2) | |||||||||||||||||||||||
Balance as of December 31, 2020 | — | — | — | |||||||||||||||||||||||
Charges incurred | 27 | 5 | 32 | |||||||||||||||||||||||
Cash payments | (32) | — | (32) | |||||||||||||||||||||||
Other non-cash reductions | — | (3) | (3) | |||||||||||||||||||||||
Reclassified from liabilities subject to compromise(1) | 7 | — | 7 | |||||||||||||||||||||||
Balance as of December 31, 2021 | $ | 2 | $ | 2 | $ | 4 |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Domestic | $ | 710 | $ | (1,692) | $ | 28 | |||||||||||
Foreign | (27) | (360) | (15) | ||||||||||||||
Total income (loss) before income taxes | $ | 683 | $ | (2,052) | $ | 13 |
As of December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Domestic | $ | 28 | $ | (293 | ) | $ | (680 | ) | |||
Foreign | (15 | ) | 36 | 105 | |||||||
Total income (loss) before income taxes | $ | 13 | $ | (257 | ) | $ | (575 | ) |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Domestic | $ | 1,501 | $ | (1,823) | $ | 35 | |||||||||||
Foreign | (27) | (360) | (15) | ||||||||||||||
Total income (loss) before income taxes | $ | 1,474 | $ | (2,183) | $ | 20 |
As of December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Domestic | $ | 35 | $ | (286 | ) | $ | (675 | ) | |||
Foreign | (15 | ) | 36 | 105 | |||||||
Total income (loss) before income taxes | $ | 20 | $ | (250 | ) | $ | (570 | ) |
As of December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Current: | |||||||||||
Federal | $ | — | $ | (3 | ) | $ | — | ||||
Foreign | 20 | 32 | 19 | ||||||||
State and local | 16 | 7 | 1 | ||||||||
Total current | 36 | 36 | 20 | ||||||||
Deferred: | |||||||||||
Federal | 1 | (66 | ) | (900 | ) | ||||||
Foreign | (1 | ) | 11 | 10 | |||||||
State and local | 27 | (11 | ) | (32 | ) | ||||||
Total deferred | 27 | (66 | ) | (922 | ) | ||||||
Total provision (benefit) - Hertz Global | 63 | (30 | ) | (902 | ) | ||||||
Federal deferred tax expense applicable to Hertz only | 2 | 2 | — | ||||||||
Total provision (benefit) - Hertz | $ | 65 | $ | (28 | ) | $ | (902 | ) |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Current: | |||||||||||||||||
Federal | $ | — | $ | — | $ | — | |||||||||||
Foreign | 24 | 18 | 20 | ||||||||||||||
State and local | 21 | 4 | 16 | ||||||||||||||
Total current | 45 | 22 | 36 | ||||||||||||||
Deferred: | |||||||||||||||||
Federal | 252 | (356) | 1 | ||||||||||||||
Foreign | 19 | 35 | (1) | ||||||||||||||
State and local | 2 | (30) | 27 | ||||||||||||||
Total deferred | 273 | (351) | 27 | ||||||||||||||
Total provision (benefit) - Hertz Global | 318 | (329) | 63 | ||||||||||||||
Federal deferred tax (provision) benefit applicable to Hertz Holdings | — | 1 | 2 | ||||||||||||||
Total provision (benefit) - Hertz | $ | 318 | $ | (328) | $ | 65 |
As of December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
Deferred tax assets: | |||||||||||
Employee benefit plans | $ | 14 | $ | 44 | |||||||
Net operating loss carry forwards | 1,321 | 825 | |||||||||
Capital loss carryforwards | 167 | 3 | |||||||||
Federal and state tax credit carry forwards | 64 | 55 | |||||||||
Accrued and prepaid expenses | 195 | 124 | |||||||||
Operating lease liabilities | 390 | 390 | |||||||||
Total deferred tax assets | 2,151 | 1,441 | |||||||||
Less: valuation allowance | (690) | (651) | |||||||||
Total net deferred tax assets | 1,461 | 790 | |||||||||
Deferred tax liabilities: | |||||||||||
Depreciation on tangible assets | (1,342) | (380) | |||||||||
Intangible assets | (711) | (723) | |||||||||
Operating lease right-of-use assets | (408) | (406) | |||||||||
Total deferred tax liabilities | (2,461) | (1,509) | |||||||||
Net deferred tax liability - Hertz Global | (1,000) | (719) | |||||||||
Deferred tax asset - net operating loss applicable to Hertz Holdings | (3) | (5) | |||||||||
Net deferred tax liability - Hertz | $ | (1,003) | $ | (724) |
As of December 31, | |||||||
2019 | 2018 | ||||||
Deferred tax assets: | |||||||
Employee benefit plans | $ | 44 | $ | 34 | |||
Net operating loss carry forwards | 2,386 | 1,937 | |||||
Federal, state and foreign local tax credit carry forwards | 43 | 42 | |||||
Accrued and prepaid expenses | 127 | 163 | |||||
Operating lease liabilities | 410 | — | |||||
Total deferred tax assets | 3,010 | 2,176 | |||||
Less: valuation allowance | (396 | ) | (318 | ) | |||
Total net deferred tax assets | 2,614 | 1,858 | |||||
Deferred tax liabilities: | |||||||
Depreciation on tangible assets | (2,518 | ) | (2,130 | ) | |||
Intangible assets | (738 | ) | (761 | ) | |||
Operating lease right-of-use assets | (422 | ) | — | ||||
Total deferred tax liabilities | (3,678 | ) | (2,891 | ) | |||
Net deferred tax liability - Hertz Global | $ | (1,064 | ) | $ | (1,033 | ) | |
Deferred tax asset - net operating loss not applicable to Hertz | (3 | ) | (3 | ) | |||
Net deferred tax liability - Hertz | $ | (1,067 | ) | $ | (1,036 | ) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Statutory federal tax rate | 21 | % | 21 | % | 21 | % | |||||||||||
State and local income taxes, net of federal effect | 7 | 5 | (102) | ||||||||||||||
Change in state rates, net of federal effect | 2 | 1 | (17) | ||||||||||||||
Foreign tax rate differential | — | — | (31) | ||||||||||||||
Change in foreign statutory rates | (2) | — | 15 | ||||||||||||||
Federal and foreign permanent differences | 1 | — | (3) | ||||||||||||||
Tax credits | (1) | — | (75) | ||||||||||||||
Withholding taxes | 1 | — | 62 | ||||||||||||||
Valuation allowance | 11 | (11) | 591 | ||||||||||||||
Change in fair value of public warrants | 22 | — | — | ||||||||||||||
Non-deductible bankruptcy expenses | 15 | — | — | ||||||||||||||
European reorganization | (46) | — | — | ||||||||||||||
Uncertain tax positions | 12 | — | 29 | ||||||||||||||
U.S. tax on foreign earnings | 2 | — | — | ||||||||||||||
Stock option shortfalls | — | — | 7 | ||||||||||||||
Other | 2 | — | 3 | ||||||||||||||
Effective tax rate - Hertz Global | 47 | 16 | 500 | ||||||||||||||
Hertz Holdings exclusive items | (25) | (1) | (174) | ||||||||||||||
Effective tax rate - Hertz | 22 | % | 15 | % | 326 | % |
Years Ended December 31, | ||||||||
2019 | 2018 | 2017 | ||||||
Statutory federal tax rate | 21 | % | 21 | % | 35 | % | ||
Foreign tax rate differential | (31 | ) | (1 | ) | 2 | |||
State and local income taxes, net of federal income tax benefit | (102 | ) | 7 | 6 | ||||
Change in state apportionment and statutory rates, net of federal income tax benefit | (17 | ) | 1 | 6 | ||||
Tax reform | — | (9 | ) | 118 | ||||
Federal and foreign permanent differences | (3 | ) | — | — | ||||
Withholding taxes | 62 | (3 | ) | (2 | ) | |||
Uncertain tax positions | 29 | (3 | ) | — | ||||
Change in valuation allowance | 591 | (5 | ) | (7 | ) | |||
Change in foreign statutory rates | 15 | (3 | ) | — | ||||
Tax credits | (75 | ) | 7 | (1 | ) | |||
Stock option shortfalls | 7 | (1 | ) | (1 | ) | |||
All other items, net | 3 | 1 | 1 | |||||
Effective tax rate - Hertz Global | 500 | % | 12 | % | 157 | % | ||
All other items, net rate impact not applicable to Hertz | (174 | ) | (1 | ) | 1 | |||
Effective tax rate - Hertz | 326 | % | 11 | % | 158 | % |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Balance as of January 1 | $ | 53 | $ | 48 | $ | 49 | |||||||||||
Increase (decrease) attributable to tax positions taken during prior periods | 65 | 5 | 5 | ||||||||||||||
Increase (decrease) attributable to tax positions taken during the current year | 19 | 1 | 1 | ||||||||||||||
Decrease attributable to settlements with taxing authorities | (31) | (1) | (7) | ||||||||||||||
Balance as of December 31 | $ | 106 | $ | 53 | $ | 48 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Balance as of January 1 | $ | 49 | $ | 43 | $ | 45 | |||||
Increase (decrease) attributable to tax positions taken during prior periods | 5 | 3 | (2 | ) | |||||||
Increase (decrease) attributable to tax positions taken during the current year | 1 | 5 | 3 | ||||||||
Decrease attributable to settlements with taxing authorities | (7 | ) | (2 | ) | (3 | ) | |||||
Balance as of December 31 | $ | 48 | $ | 49 | $ | 43 |
Fair Value of Financial Instruments | |||||||||||||||
Asset Derivatives(1) | Liability Derivatives(1) | ||||||||||||||
December 31, | December 31, | ||||||||||||||
(In millions) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Interest rate instruments | $ | 4 | $ | 3 | $ | — | $ | 4 | |||||||
Foreign currency forward contracts | 4 | 1 | — | 6 | |||||||||||
Total | $ | 8 | $ | 4 | $ | — | $ | 10 |
Location of Gain or (Loss) Recognized on Derivatives | Amount of Gain or (Loss) Recognized in Income on Derivatives | |||||||||||||
Years Ended December 31, | ||||||||||||||
(In millions) | 2019 | 2018 | 2017 | |||||||||||
Interest rate instruments | Selling, general and administrative | $ | 3 | $ | 1 | $ | (5 | ) | ||||||
Foreign currency forward contracts | Selling, general and administrative | 9 | — | 9 | ||||||||||
Total | $ | 12 | $ | 1 | $ | 4 |
December 31, 2019 | December 31, 2018 | ||||||||||||||||||||||||||||||
(In millions) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||
Money market funds and time deposits | $ | 531 | $ | — | $ | — | $ | 531 | $ | 701 | $ | — | $ | — | $ | 701 | |||||||||||||||
Marketable securities | 74 | — | — | 74 | 44 | — | — | 44 |
December 31, 2021 | December 31, 2020 | ||||||||||||||||||||||
(In millions) | Nominal Unpaid Principal Balance | Aggregate Fair Value | Nominal Unpaid Principal Balance | Aggregate Fair Value | |||||||||||||||||||
Non-Vehicle Debt(1) | $ | 3,055 | $ | 3,065 | $ | 4,747 | $ | 3,382 | |||||||||||||||
Vehicle Debt | 7,954 | 7,908 | 6,087 | 6,021 | |||||||||||||||||||
Total | $ | 11,009 | $ | 10,973 | $ | 10,834 | $ | 9,403 |
As of December 31, 2019 | As of December 31, 2018 | ||||||||||||||
(In millions) | Nominal Unpaid Principal Balance | Aggregate Fair Value | Nominal Unpaid Principal Balance | Aggregate Fair Value | |||||||||||
Non-Vehicle Debt | $ | 3,755 | $ | 3,840 | $ | 4,455 | $ | 4,011 | |||||||
Vehicle Debt | 13,415 | 13,529 | 11,945 | 11,891 | |||||||||||
Total | $ | 17,170 | $ | 17,369 | $ | 16,400 | $ | 15,902 |
December 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
(In millions) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Cash equivalents and restricted cash equivalents | $ | 1,678 | $ | — | $ | — | $ | 1,678 | $ | 723 | $ | — | $ | — | $ | 723 | |||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||
Public warrants | $ | 1,324 | $ | — | $ | — | $ | 1,324 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||
Balance as of January 1, 2021 | $ | (122) | $ | (71) | $ | (19) | $ | (212) | |||||||||||||||
Other comprehensive income (loss) before reclassification | 22 | (36) | — | (14) | |||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 12 | — | — | 12 | |||||||||||||||||||
Balance as of December 31, 2021 | $ | (88) | $ | (107) | $ | (19) | $ | (214) |
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||
Balance as of January 1, 2019 | $ | (115 | ) | $ | (58 | ) | $ | (19 | ) | $ | (192 | ) | |||
Other comprehensive income (loss) before reclassification | (12 | ) | 6 | — | (6 | ) | |||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 9 | — | — | 9 | |||||||||||
Balance as of December 31, 2019 | $ | (118 | ) | $ | (52 | ) | $ | (19 | ) | $ | (189 | ) |
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||
Balance as of January 1, 2018 | $ | (76 | ) | $ | (23 | ) | $ | (19 | ) | $ | (118 | ) | |||
Other comprehensive income (loss) before reclassification | (32 | ) | (34 | ) | — | (66 | ) | ||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 4 | (1 | ) | — | 3 | ||||||||||
Reclassification of income tax effects to accumulated deficit resulting from the Tax Cuts and Job Act | (11 | ) | — | — | (11 | ) | |||||||||
Balance as of December 31, 2018 | $ | (115 | ) | $ | (58 | ) | $ | (19 | ) | $ | (192 | ) |
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||
Balance as of January 1, 2020 | $ | (118) | $ | (52) | $ | (19) | $ | (189) | |||||||||||||||
Other comprehensive income (loss) before reclassification | (15) | (19) | — | (34) | |||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 11 | — | — | 11 | |||||||||||||||||||
Balance as of December 31, 2020 | $ | (122) | $ | (71) | $ | (19) | $ | (212) |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Domestic | $ | 710 | $ | (1,692) | $ | 28 | |||||||||||
Foreign | (27) | (360) | (15) | ||||||||||||||
Total income (loss) before income taxes | $ | 683 | $ | (2,052) | $ | 13 |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Domestic | $ | 1,501 | $ | (1,823) | $ | 35 | |||||||||||
Foreign | (27) | (360) | (15) | ||||||||||||||
Total income (loss) before income taxes | $ | 1,474 | $ | (2,183) | $ | 20 |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Current: | |||||||||||||||||
Federal | $ | — | $ | — | $ | — | |||||||||||
Foreign | 24 | 18 | 20 | ||||||||||||||
State and local | 21 | 4 | 16 | ||||||||||||||
Total current | 45 | 22 | 36 | ||||||||||||||
Deferred: | |||||||||||||||||
Federal | 252 | (356) | 1 | ||||||||||||||
Foreign | 19 | 35 | (1) | ||||||||||||||
State and local | 2 | (30) | 27 | ||||||||||||||
Total deferred | 273 | (351) | 27 | ||||||||||||||
Total provision (benefit) - Hertz Global | 318 | (329) | 63 | ||||||||||||||
Federal deferred tax (provision) benefit applicable to Hertz Holdings | — | 1 | 2 | ||||||||||||||
Total provision (benefit) - Hertz | $ | 318 | $ | (328) | $ | 65 |
As of December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
Deferred tax assets: | |||||||||||
Employee benefit plans | $ | 14 | $ | 44 | |||||||
Net operating loss carry forwards | 1,321 | 825 | |||||||||
Capital loss carryforwards | 167 | 3 | |||||||||
Federal and state tax credit carry forwards | 64 | 55 | |||||||||
Accrued and prepaid expenses | 195 | 124 | |||||||||
Operating lease liabilities | 390 | 390 | |||||||||
Total deferred tax assets | 2,151 | 1,441 | |||||||||
Less: valuation allowance | (690) | (651) | |||||||||
Total net deferred tax assets | 1,461 | 790 | |||||||||
Deferred tax liabilities: | |||||||||||
Depreciation on tangible assets | (1,342) | (380) | |||||||||
Intangible assets | (711) | (723) | |||||||||
Operating lease right-of-use assets | (408) | (406) | |||||||||
Total deferred tax liabilities | (2,461) | (1,509) | |||||||||
Net deferred tax liability - Hertz Global | (1,000) | (719) | |||||||||
Deferred tax asset - net operating loss applicable to Hertz Holdings | (3) | (5) | |||||||||
Net deferred tax liability - Hertz | $ | (1,003) | $ | (724) |
Years Ended December 31, | |||||||||||
(In millions, except per share data) | 2019 | 2018 | 2017 | ||||||||
Numerator: | |||||||||||
Net income (loss) attributable to Hertz Global | $ | (58 | ) | $ | (225 | ) | $ | 327 | |||
Denominator: | |||||||||||
Basic weighted-average shares outstanding (excluding the impact of the Rights Offering) | 84 | 84 | 83 | ||||||||
Rights Offering adjustment(1) | 6 | 12 | 12 | ||||||||
New shares issued under the Rights Offering(2) | 27 | — | — | ||||||||
Basic weighted-average shares outstanding | 117 | 96 | 95 | ||||||||
Dilutive stock options, RSUs and PSUs | — | — | — | ||||||||
Diluted weighted-average shares outstanding | 117 | 96 | 95 | ||||||||
Antidilutive stock options, RSUs, PSUs and PSAs | 2 | 1 | 3 | ||||||||
Earnings (loss) per share: | |||||||||||
Basic earnings (loss) per share | $ | (0.49 | ) | $ | (2.35 | ) | $ | 3.44 | |||
Diluted earnings (loss) per share | $ | (0.49 | ) | $ | (2.35 | ) | $ | 3.44 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Statutory federal tax rate | 21 | % | 21 | % | 21 | % | |||||||||||
State and local income taxes, net of federal effect | 7 | 5 | (102) | ||||||||||||||
Change in state rates, net of federal effect | 2 | 1 | (17) | ||||||||||||||
Foreign tax rate differential | — | — | (31) | ||||||||||||||
Change in foreign statutory rates | (2) | — | 15 | ||||||||||||||
Federal and foreign permanent differences | 1 | — | (3) | ||||||||||||||
Tax credits | (1) | — | (75) | ||||||||||||||
Withholding taxes | 1 | — | 62 | ||||||||||||||
Valuation allowance | 11 | (11) | 591 | ||||||||||||||
Change in fair value of public warrants | 22 | — | — | ||||||||||||||
Non-deductible bankruptcy expenses | 15 | — | — | ||||||||||||||
European reorganization | (46) | — | — | ||||||||||||||
Uncertain tax positions | 12 | — | 29 | ||||||||||||||
U.S. tax on foreign earnings | 2 | — | — | ||||||||||||||
Stock option shortfalls | — | — | 7 | ||||||||||||||
Other | 2 | — | 3 | ||||||||||||||
Effective tax rate - Hertz Global | 47 | 16 | 500 | ||||||||||||||
Hertz Holdings exclusive items | (25) | (1) | (174) | ||||||||||||||
Effective tax rate - Hertz | 22 | % | 15 | % | 326 | % |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Revenues | |||||||||||
U.S. Rental Car | $ | 6,938 | $ | 6,480 | $ | 5,994 | |||||
International Rental Car | 2,169 | 2,276 | 2,169 | ||||||||
All Other Operations | 672 | 748 | 640 | ||||||||
Total Hertz Global and Hertz | $ | 9,779 | $ | 9,504 | $ | 8,803 | |||||
Depreciation of revenue earning vehicles and lease charges | |||||||||||
U.S. Rental Car | $ | 1,656 | $ | 1,678 | $ | 1,904 | |||||
International Rental Car | 440 | 448 | 416 | ||||||||
All Other Operations | 469 | 564 | 478 | ||||||||
Total Hertz Global and Hertz | $ | 2,565 | $ | 2,690 | $ | 2,798 | |||||
Depreciation and amortization, non-vehicle assets | |||||||||||
U.S. Rental Car | $ | 156 | $ | 159 | $ | 181 | |||||
International Rental Car | 23 | 32 | 33 | ||||||||
All Other Operations | 10 | 10 | 11 | ||||||||
Corporate | 14 | 17 | 15 | ||||||||
Total Hertz Global and Hertz | $ | 203 | $ | 218 | $ | 240 | |||||
Interest expense, net | |||||||||||
U.S. Rental Car | $ | 157 | $ | 144 | $ | 132 | |||||
International Rental Car | 93 | 113 | 80 | ||||||||
All Other Operations | 31 | 27 | 19 | ||||||||
Corporate | 524 | 455 | 406 | ||||||||
Total Hertz Global | 805 | 739 | 637 | ||||||||
Hertz interest income from loan to Hertz Global | (7 | ) | (7 | ) | (5 | ) | |||||
Total - Hertz | $ | 798 | $ | 732 | $ | 632 | |||||
Adjusted EBITDA | |||||||||||
U.S. Rental Car | $ | 480 | $ | 226 | $ | 50 | |||||
International Rental Car | 147 | 231 | 235 | ||||||||
All Other Operations | 100 | 82 | 74 | ||||||||
Corporate | (78 | ) | (106 | ) | (92 | ) | |||||
Total Hertz Global and Hertz | $ | 649 | $ | 433 | $ | 267 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Balance as of January 1 | $ | 53 | $ | 48 | $ | 49 | |||||||||||
Increase (decrease) attributable to tax positions taken during prior periods | 65 | 5 | 5 | ||||||||||||||
Increase (decrease) attributable to tax positions taken during the current year | 19 | 1 | 1 | ||||||||||||||
Decrease attributable to settlements with taxing authorities | (31) | (1) | (7) | ||||||||||||||
Balance as of December 31 | $ | 106 | $ | 53 | $ | 48 |
As of December 31, | |||||||
(In millions) | 2019 | 2018 | |||||
Revenue earning vehicles, net | |||||||
U.S. Rental Car | $ | 9,820 | $ | 8,793 | |||
International Rental Car | 2,319 | 2,146 | |||||
All Other Operations | 1,650 | 1,480 | |||||
Total Hertz Global and Hertz | $ | 13,789 | $ | 12,419 | |||
Property and equipment, net | |||||||
U.S. Rental Car | $ | 541 | $ | 564 | |||
International Rental Car | 99 | 100 | |||||
All Other Operations | 7 | 9 | |||||
Corporate | 110 | 105 | |||||
Total Hertz Global and Hertz | $ | 757 | $ | 778 | |||
Total assets | |||||||
U.S. Rental Car | $ | 16,459 | $ | 13,983 | |||
International Rental Car | 4,563 | 4,057 | |||||
All Other Operations | 2,115 | 1,843 | |||||
Corporate | 1,490 | 1,499 | |||||
Total Hertz Global and Hertz | $ | 24,627 | $ | 21,382 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Revenue earning vehicles and non-vehicle capital assets | |||||||||||
U.S. Rental Car: | |||||||||||
Expenditures | $ | (9,384 | ) | $ | (8,597 | ) | $ | (6,837 | ) | ||
Proceeds from disposals | 6,306 | 5,570 | 4,882 | ||||||||
Net expenditures - Hertz Global and Hertz | $ | (3,078 | ) | $ | (3,027 | ) | $ | (1,955 | ) | ||
International Rental Car: | |||||||||||
Expenditures | $ | (3,401 | ) | $ | (3,191 | ) | $ | (3,144 | ) | ||
Proceeds from disposals | 2,854 | 2,755 | 2,606 | ||||||||
Net expenditures - Hertz Global and Hertz | $ | (547 | ) | $ | (436 | ) | $ | (538 | ) | ||
All Other Operations: | |||||||||||
Expenditures | $ | (1,043 | ) | $ | (807 | ) | $ | (735 | ) | ||
Proceeds from disposals | 352 | 176 | 182 | ||||||||
Net expenditures - Hertz Global and Hertz | $ | (691 | ) | $ | (631 | ) | $ | (553 | ) | ||
Corporate: | |||||||||||
Expenditures | $ | (110 | ) | $ | (75 | ) | $ | (53 | ) | ||
Proceeds from disposals | 1 | 2 | 4 | ||||||||
Net expenditures - Hertz Global and Hertz | $ | (109 | ) | $ | (73 | ) | $ | (49 | ) |
December 31, 2021 | December 31, 2020 | ||||||||||||||||||||||
(In millions) | Nominal Unpaid Principal Balance | Aggregate Fair Value | Nominal Unpaid Principal Balance | Aggregate Fair Value | |||||||||||||||||||
Non-Vehicle Debt(1) | $ | 3,055 | $ | 3,065 | $ | 4,747 | $ | 3,382 | |||||||||||||||
Vehicle Debt | 7,954 | 7,908 | 6,087 | 6,021 | |||||||||||||||||||
Total | $ | 11,009 | $ | 10,973 | $ | 10,834 | $ | 9,403 |
December 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
(In millions) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Cash equivalents and restricted cash equivalents | $ | 1,678 | $ | — | $ | — | $ | 1,678 | $ | 723 | $ | — | $ | — | $ | 723 | |||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||
Public warrants | $ | 1,324 | $ | — | $ | — | $ | 1,324 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Revenues | |||||||||||
United States | $ | 7,596 | $ | 7,211 | $ | 6,620 | |||||
International | 2,183 | 2,293 | 2,183 | ||||||||
Total Hertz Global and Hertz | $ | 9,779 | $ | 9,504 | $ | 8,803 |
As of December 31, | |||||||
(In millions) | 2019 | 2018 | |||||
Revenue earning vehicles, net | |||||||
United States | $ | 11,424 | $ | 10,235 | |||
International | 2,365 | 2,184 | |||||
Total Hertz Global and Hertz | $ | 13,789 | $ | 12,419 | |||
Property and equipment, net | |||||||
United States | $ | 658 | $ | 678 | |||
International | 99 | 100 | |||||
Total Hertz Global and Hertz | $ | 757 | $ | 778 | |||
Total assets | |||||||
United States | $ | 19,876 | $ | 17,144 | |||
International | 4,751 | 4,238 | |||||
Total Hertz Global and Hertz | $ | 24,627 | $ | 21,382 |
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||
Balance as of January 1, 2021 | $ | (122) | $ | (71) | $ | (19) | $ | (212) | |||||||||||||||
Other comprehensive income (loss) before reclassification | 22 | (36) | — | (14) | |||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 12 | — | — | 12 | |||||||||||||||||||
Balance as of December 31, 2021 | $ | (88) | $ | (107) | $ | (19) | $ | (214) |
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||
Balance as of January 1, 2020 | $ | (118) | $ | (52) | $ | (19) | $ | (189) | |||||||||||||||
Other comprehensive income (loss) before reclassification | (15) | (19) | — | (34) | |||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 11 | — | — | 11 | |||||||||||||||||||
Balance as of December 31, 2020 | $ | (122) | $ | (71) | $ | (19) | $ | (212) |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Domestic | $ | 710 | $ | (1,692) | $ | 28 | |||||||||||
Foreign | (27) | (360) | (15) | ||||||||||||||
Total income (loss) before income taxes | $ | 683 | $ | (2,052) | $ | 13 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Adjusted EBITDA: | |||||||||||
U.S. Rental Car | $ | 480 | $ | 226 | $ | 50 | |||||
International Rental Car | 147 | 231 | 235 | ||||||||
All Other Operations | 100 | 82 | 74 | ||||||||
Total reportable segments | 727 | 539 | 359 | ||||||||
Corporate(1) | (78 | ) | (106 | ) | (92 | ) | |||||
Total Hertz Global | 649 | 433 | 267 | ||||||||
Adjustments: | |||||||||||
Non-vehicle depreciation and amortization | (203 | ) | (218 | ) | (240 | ) | |||||
Non-vehicle debt interest, net | (311 | ) | (291 | ) | (306 | ) | |||||
Vehicle debt-related charges(2) | (38 | ) | (36 | ) | (32 | ) | |||||
Loss on extinguishment of vehicle debt(3) | — | (22 | ) | — | |||||||
Restructuring and restructuring related charges(4) | (14 | ) | (32 | ) | (20 | ) | |||||
Impairment charges and asset write-downs(5) | — | — | (118 | ) | |||||||
Information technology and finance transformation costs(6) | (114 | ) | (98 | ) | (68 | ) | |||||
Other items(7) | 44 | 7 | (58 | ) | |||||||
Income (loss) from before income taxes | $ | 13 | $ | (257 | ) | $ | (575 | ) |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Domestic | $ | 1,501 | $ | (1,823) | $ | 35 | |||||||||||
Foreign | (27) | (360) | (15) | ||||||||||||||
Total income (loss) before income taxes | $ | 1,474 | $ | (2,183) | $ | 20 |
Years Ended December 31, | |||||||||||
(In millions) | 2019 | 2018 | 2017 | ||||||||
Adjusted EBITDA: | |||||||||||
U.S. Rental Car | $ | 480 | $ | 226 | $ | 50 | |||||
International Rental Car | 147 | 231 | 235 | ||||||||
All Other Operations | 100 | 82 | 74 | ||||||||
Total reportable segments | 727 | 539 | 359 | ||||||||
Corporate(1) | (78 | ) | (106 | ) | (92 | ) | |||||
Total Hertz | 649 | 433 | 267 | ||||||||
Adjustments: | |||||||||||
Non-vehicle depreciation and amortization | (203 | ) | (218 | ) | (240 | ) | |||||
Non-vehicle debt interest, net | (304 | ) | (284 | ) | (301 | ) | |||||
Vehicle debt-related charges(2) | (38 | ) | (36 | ) | (32 | ) | |||||
Loss on extinguishment of vehicle debt(3) | — | (22 | ) | — | |||||||
Restructuring and restructuring related charges(4) | (14 | ) | (32 | ) | (20 | ) | |||||
Impairment charges and asset write-downs(5) | — | — | (118 | ) | |||||||
Information technology and finance transformation costs(6) | (114 | ) | (98 | ) | (68 | ) | |||||
Other items(7) | 44 | 7 | (58 | ) | |||||||
Income (loss) from before income taxes | $ | 20 | $ | (250 | ) | $ | (570 | ) |
As of December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Current: | |||||||||||||||||
Federal | $ | — | $ | — | $ | — | |||||||||||
Foreign | 24 | 18 | 20 | ||||||||||||||
State and local | 21 | 4 | 16 | ||||||||||||||
Total current | 45 | 22 | 36 | ||||||||||||||
Deferred: | |||||||||||||||||
Federal | 252 | (356) | 1 | ||||||||||||||
Foreign | 19 | 35 | (1) | ||||||||||||||
State and local | 2 | (30) | 27 | ||||||||||||||
Total deferred | 273 | (351) | 27 | ||||||||||||||
Total provision (benefit) - Hertz Global | 318 | (329) | 63 | ||||||||||||||
Federal deferred tax (provision) benefit applicable to Hertz Holdings | — | 1 | 2 | ||||||||||||||
Total provision (benefit) - Hertz | $ | 318 | $ | (328) | $ | 65 |
As of December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
Deferred tax assets: | |||||||||||
Employee benefit plans | $ | 14 | $ | 44 | |||||||
Net operating loss carry forwards | 1,321 | 825 | |||||||||
Capital loss carryforwards | 167 | 3 | |||||||||
Federal and state tax credit carry forwards | 64 | 55 | |||||||||
Accrued and prepaid expenses | 195 | 124 | |||||||||
Operating lease liabilities | 390 | 390 | |||||||||
Total deferred tax assets | 2,151 | 1,441 | |||||||||
Less: valuation allowance | (690) | (651) | |||||||||
Total net deferred tax assets | 1,461 | 790 | |||||||||
Deferred tax liabilities: | |||||||||||
Depreciation on tangible assets | (1,342) | (380) | |||||||||
Intangible assets | (711) | (723) | |||||||||
Operating lease right-of-use assets | (408) | (406) | |||||||||
Total deferred tax liabilities | (2,461) | (1,509) | |||||||||
Net deferred tax liability - Hertz Global | (1,000) | (719) | |||||||||
Deferred tax asset - net operating loss applicable to Hertz Holdings | (3) | (5) | |||||||||
Net deferred tax liability - Hertz | $ | (1,003) | $ | (724) |
First Quarter (1) | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
(In millions, except per share data) | 2019 | 2019 | 2019 | 2019 | |||||||||||
Total revenues | $ | 2,107 | $ | 2,511 | $ | 2,836 | $ | 2,326 | |||||||
Income (loss) before income taxes | (149 | ) | 44 | 247 | (130 | ) | |||||||||
Net income (loss) attributable to Hertz Global | (147 | ) | 38 | 169 | (118 | ) | |||||||||
Earnings (loss) per share: | |||||||||||||||
Basic | (1.54 | ) | 0.40 | 1.26 | (0.83 | ) | |||||||||
Diluted | (1.54 | ) | 0.40 | 1.26 | (0.83 | ) |
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
(In millions, except per share data) | 2018 | 2018 | 2018 | 2018 | |||||||||||
Total revenues | $ | 2,063 | $ | 2,389 | $ | 2,758 | $ | 2,294 | |||||||
Income (loss) before income taxes | (231 | ) | (86 | ) | 181 | (120 | ) | ||||||||
Net income (loss) attributable to Hertz Global | (202 | ) | (63 | ) | 141 | (101 | ) | ||||||||
Earnings (loss) per share(1): | |||||||||||||||
Basic | (2.13 | ) | (0.66 | ) | 1.47 | (1.05 | ) | ||||||||
Diluted | (2.13 | ) | (0.66 | ) | 1.47 | (1.05 | ) |
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
(In millions) | 2019 | 2019 | 2019 | 2019 | |||||||||||
Total revenues | $ | 2,107 | $ | 2,511 | $ | 2,836 | $ | 2,326 | |||||||
Income (loss) before income taxes | (147 | ) | 46 | 249 | (128 | ) | |||||||||
Net income (loss) attributable to Hertz | (145 | ) | 39 | 170 | (117 | ) |
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
(In millions) | 2018 | 2018 | 2018 | 2018 | |||||||||||
Total revenues | $ | 2,063 | $ | 2,389 | $ | 2,758 | $ | 2,294 | |||||||
Income (loss) before income taxes | (230 | ) | (84 | ) | 183 | (118 | ) | ||||||||
Net income (loss) attributable to Hertz | (201 | ) | (61 | ) | 142 | (99 | ) |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Statutory federal tax rate | 21 | % | 21 | % | 21 | % | |||||||||||
State and local income taxes, net of federal effect | 7 | 5 | (102) | ||||||||||||||
Change in state rates, net of federal effect | 2 | 1 | (17) | ||||||||||||||
Foreign tax rate differential | — | — | (31) | ||||||||||||||
Change in foreign statutory rates | (2) | — | 15 | ||||||||||||||
Federal and foreign permanent differences | 1 | — | (3) | ||||||||||||||
Tax credits | (1) | — | (75) | ||||||||||||||
Withholding taxes | 1 | — | 62 | ||||||||||||||
Valuation allowance | 11 | (11) | 591 | ||||||||||||||
Change in fair value of public warrants | 22 | — | — | ||||||||||||||
Non-deductible bankruptcy expenses | 15 | — | — | ||||||||||||||
European reorganization | (46) | — | — | ||||||||||||||
Uncertain tax positions | 12 | — | 29 | ||||||||||||||
U.S. tax on foreign earnings | 2 | — | — | ||||||||||||||
Stock option shortfalls | — | — | 7 | ||||||||||||||
Other | 2 | — | 3 | ||||||||||||||
Effective tax rate - Hertz Global | 47 | 16 | 500 | ||||||||||||||
Hertz Holdings exclusive items | (25) | (1) | (174) | ||||||||||||||
Effective tax rate - Hertz | 22 | % | 15 | % | 326 | % |
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and cash equivalents | $ | 437 | $ | 2 | $ | 426 | $ | — | $ | 865 | ||||||||||
Restricted cash and cash equivalents | 72 | 5 | 418 | — | 495 | |||||||||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 509 | 7 | 844 | — | 1,360 | |||||||||||||||
Receivables, net of allowance | 424 | 184 | 1,232 | — | 1,840 | |||||||||||||||
Due from affiliates | 4,099 | 4,911 | 8,188 | (17,198 | ) | — | ||||||||||||||
Prepaid expenses and other assets | 5,793 | 34 | 251 | (5,389 | ) | 689 | ||||||||||||||
Revenue earning vehicles, net | 472 | — | 13,317 | — | 13,789 | |||||||||||||||
Property and equipment, net | 597 | 61 | 99 | — | 757 | |||||||||||||||
Operating lease right-of-use assets | 1,282 | 208 | 381 | — | 1,871 | |||||||||||||||
Investment in subsidiaries, net | 6,921 | 1,631 | — | (8,552 | ) | — | ||||||||||||||
Intangible assets, net | 247 | 2,987 | 4 | — | 3,238 | |||||||||||||||
Goodwill | 102 | 943 | 38 | — | 1,083 | |||||||||||||||
Total assets | $ | 20,446 | $ | 10,966 | $ | 24,354 | $ | (31,139 | ) | $ | 24,627 | |||||||||
LIABILITIES AND STOCKHOLDER'S EQUITY | ||||||||||||||||||||
Due to affiliates | $ | 12,266 | $ | 1,370 | $ | 3,562 | $ | (17,198 | ) | $ | — | |||||||||
Accounts payable | 375 | 131 | 437 | — | 943 | |||||||||||||||
Accrued liabilities | 670 | 52 | 464 | — | 1,186 | |||||||||||||||
Accrued taxes, net | 74 | 16 | 3,665 | (3,605 | ) | 150 | ||||||||||||||
Debt | 3,867 | — | 13,222 | — | 17,089 | |||||||||||||||
Operating lease liabilities | 1,259 | 205 | 384 | — | 1,848 | |||||||||||||||
Public liability and property damage | 170 | 36 | 193 | — | 399 | |||||||||||||||
Deferred income taxes, net | — | 1,939 | 973 | (1,784 | ) | 1,128 | ||||||||||||||
Total liabilities | 18,681 | 3,749 | 22,900 | (22,587 | ) | 22,743 | ||||||||||||||
Stockholder's equity: | ||||||||||||||||||||
Total stockholder's equity attributable to Hertz | 1,765 | 7,217 | 1,335 | (8,552 | ) | 1,765 | ||||||||||||||
Noncontrolling interests | — | — | 119 | — | 119 | |||||||||||||||
Total stockholder's equity | 1,765 | 7,217 | 1,454 | (8,552 | ) | 1,884 | ||||||||||||||
Total liabilities and stockholder's equity | $ | 20,446 | $ | 10,966 | $ | 24,354 | $ | (31,139 | ) | $ | 24,627 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Balance as of January 1 | $ | 53 | $ | 48 | $ | 49 | |||||||||||
Increase (decrease) attributable to tax positions taken during prior periods | 65 | 5 | 5 | ||||||||||||||
Increase (decrease) attributable to tax positions taken during the current year | 19 | 1 | 1 | ||||||||||||||
Decrease attributable to settlements with taxing authorities | (31) | (1) | (7) | ||||||||||||||
Balance as of December 31 | $ | 106 | $ | 53 | $ | 48 |
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and cash equivalents | $ | 576 | $ | 3 | $ | 548 | $ | — | $ | 1,127 | ||||||||||
Restricted cash and cash equivalents | 137 | 8 | 138 | — | 283 | |||||||||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 713 | 11 | 686 | — | 1,410 | |||||||||||||||
Receivables, net of allowance | 421 | 174 | 992 | — | 1,587 | |||||||||||||||
Due from affiliates | 3,522 | 5,312 | 9,101 | (17,935 | ) | — | ||||||||||||||
Prepaid expenses and other assets | 4,863 | 34 | 269 | (4,264 | ) | 902 | ||||||||||||||
Revenue earning vehicles, net | 421 | 1 | 11,997 | — | 12,419 | |||||||||||||||
Property and equipment, net | 590 | 64 | 124 | — | 778 | |||||||||||||||
Investment in subsidiaries, net | 7,648 | 1,526 | — | (9,174 | ) | — | ||||||||||||||
Intangible assets, net | 160 | 3,039 | 4 | — | 3,203 | |||||||||||||||
Goodwill | 102 | 943 | 38 | — | 1,083 | |||||||||||||||
Total assets | $ | 18,440 | $ | 11,104 | $ | 23,211 | $ | (31,373 | ) | $ | 21,382 | |||||||||
LIABILITIES AND STOCKHOLDER'S EQUITY | ||||||||||||||||||||
Due to affiliates | $ | 11,351 | $ | 2,306 | $ | 4,278 | $ | (17,935 | ) | $ | — | |||||||||
Accounts payable | 388 | 97 | 503 | — | 988 | |||||||||||||||
Accrued liabilities | 823 | 69 | 412 | — | 1,304 | |||||||||||||||
Accrued taxes, net | 67 | 15 | 2,359 | (2,305 | ) | 136 | ||||||||||||||
Debt | 4,567 | — | 11,757 | — | 16,324 | |||||||||||||||
Public liability and property damage | 185 | 41 | 192 | — | 418 | |||||||||||||||
Deferred income taxes, net | — | 1,729 | 1,324 | (1,959 | ) | 1,094 | ||||||||||||||
Total liabilities | 17,381 | 4,257 | 20,825 | (22,199 | ) | 20,264 | ||||||||||||||
Stockholder's equity: | ||||||||||||||||||||
Total stockholder's equity attributable to Hertz | 1,059 | 6,847 | 2,327 | (9,174 | ) | 1,059 | ||||||||||||||
Noncontrolling interests | — | — | 59 | — | 59 | |||||||||||||||
Total stockholder's equity | 1,059 | 6,847 | 2,386 | (9,174 | ) | 1,118 | ||||||||||||||
Total liabilities and stockholder's equity | $ | 18,440 | $ | 11,104 | $ | 23,211 | $ | (31,373 | ) | $ | 21,382 |
December 31, 2021 | December 31, 2020 | ||||||||||||||||||||||
(In millions) | Nominal Unpaid Principal Balance | Aggregate Fair Value | Nominal Unpaid Principal Balance | Aggregate Fair Value | |||||||||||||||||||
Non-Vehicle Debt(1) | $ | 3,055 | $ | 3,065 | $ | 4,747 | $ | 3,382 | |||||||||||||||
Vehicle Debt | 7,954 | 7,908 | 6,087 | 6,021 | |||||||||||||||||||
Total | $ | 11,009 | $ | 10,973 | $ | 10,834 | $ | 9,403 |
December 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
(In millions) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Cash equivalents and restricted cash equivalents | $ | 1,678 | $ | — | $ | — | $ | 1,678 | $ | 723 | $ | — | $ | — | $ | 723 | |||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||
Public warrants | $ | 1,324 | $ | — | $ | — | $ | 1,324 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | ||||||||||||||||
Total revenues | $ | 5,065 | $ | 1,541 | $ | 8,840 | $ | (5,667 | ) | $ | 9,779 | |||||||||
Expenses: | ||||||||||||||||||||
Direct vehicle and operating | 3,100 | 970 | 1,416 | — | 5,486 | |||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 5,534 | 337 | 2,361 | (5,667 | ) | 2,565 | ||||||||||||||
Selling, general and administrative | 601 | 125 | 243 | — | 969 | |||||||||||||||
Interest (income) expense, net | 460 | (193 | ) | 531 | — | 798 | ||||||||||||||
Other (income) expense, net | (59 | ) | — | — | — | (59 | ) | |||||||||||||
Total expenses | 9,636 | 1,239 | 4,551 | (5,667 | ) | 9,759 | ||||||||||||||
Income (loss) before income taxes and equity in earnings (losses) of subsidiaries | (4,571 | ) | 302 | 4,289 | — | 20 | ||||||||||||||
Income tax (provision) benefit | (34 | ) | (82 | ) | 51 | — | (65 | ) | ||||||||||||
Equity in earnings (losses) of subsidiaries, net of tax | 4,552 | 88 | — | (4,640 | ) | — | ||||||||||||||
Net income (loss) | (53 | ) | 308 | 4,340 | (4,640 | ) | (45 | ) | ||||||||||||
Net (income) loss attributable to noncontrolling interests | — | — | (8 | ) | — | (8 | ) | |||||||||||||
Net income (loss) attributable to Hertz | (53 | ) | 308 | 4,332 | (4,640 | ) | (53 | ) | ||||||||||||
Total other comprehensive income (loss), net of tax | 3 | 4 | (5 | ) | 1 | 3 | ||||||||||||||
Comprehensive income (loss) attributable to Hertz | $ | (50 | ) | $ | 312 | $ | 4,327 | $ | (4,639 | ) | $ | (50 | ) |
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | ||||||||||||||||
Total revenues | $ | 4,769 | $ | 1,448 | $ | 7,785 | $ | (4,498 | ) | $ | 9,504 | |||||||||
Expenses: | ||||||||||||||||||||
Direct vehicle and operating | 3,286 | 711 | 1,358 | — | 5,355 | |||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 4,268 | 354 | 2,566 | (4,498 | ) | 2,690 | ||||||||||||||
Selling, general and administrative | 681 | 69 | 267 | — | 1,017 | |||||||||||||||
Interest (income) expense, net | 416 | (155 | ) | 471 | — | 732 | ||||||||||||||
Other (income) expense, net | (33 | ) | — | (7 | ) | — | (40 | ) | ||||||||||||
Total expenses | 8,618 | 979 | 4,655 | (4,498 | ) | 9,754 | ||||||||||||||
Income (loss) before income taxes and equity in earnings (losses) of subsidiaries | (3,849 | ) | 469 | 3,130 | — | (250 | ) | |||||||||||||
Income tax (provision) benefit | 807 | (102 | ) | (677 | ) | — | 28 | |||||||||||||
Equity in earnings (losses) of subsidiaries, net of tax | 2,822 | 291 | — | (3,113 | ) | — | ||||||||||||||
Net income (loss) | (220 | ) | 658 | 2,453 | (3,113 | ) | (222 | ) | ||||||||||||
Net (income) loss attributable to noncontrolling interests | — | — | 2 | — | 2 | |||||||||||||||
Net income (loss) attributable to Hertz | (220 | ) | 658 | 2,455 | (3,113 | ) | (220 | ) | ||||||||||||
Total other comprehensive income (loss), net of tax | (63 | ) | (7 | ) | (33 | ) | 40 | (63 | ) | |||||||||||
Comprehensive income (loss) attributable to Hertz | $ | (283 | ) | $ | 651 | $ | 2,422 | $ | (3,073 | ) | $ | (283 | ) |
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | ||||||||||||||||
Total revenues | $ | 4,361 | $ | 1,381 | $ | 6,442 | $ | (3,381 | ) | $ | 8,803 | |||||||||
Expenses: | ||||||||||||||||||||
Direct vehicle and operating | 2,937 | 698 | 1,323 | — | 4,958 | |||||||||||||||
Depreciation of revenue earning vehicles and lease charges | 3,157 | 413 | 2,609 | (3,381 | ) | 2,798 | ||||||||||||||
Selling, general and administrative | 612 | 37 | 231 | — | 880 | |||||||||||||||
Interest (income) expense, net | 400 | (105 | ) | 337 | — | 632 | ||||||||||||||
Goodwill and intangible asset impairments | — | 86 | — | — | 86 | |||||||||||||||
Other (income) expense, net | 30 | — | (11 | ) | — | 19 | ||||||||||||||
Total expenses | 7,136 | 1,129 | 4,489 | (3,381 | ) | 9,373 | ||||||||||||||
Income (loss) before income taxes and equity in earnings (losses) of subsidiaries | (2,775 | ) | 252 | 1,953 | — | (570 | ) | |||||||||||||
Income tax (provision) benefit | (925 | ) | 311 | 1,516 | — | 902 | ||||||||||||||
Equity in earnings (losses) of subsidiaries, net of tax | 4,032 | 629 | — | (4,661 | ) | — | ||||||||||||||
Net income (loss) attributable to Hertz | 332 | 1,192 | 3,469 | (4,661 | ) | 332 | ||||||||||||||
Total other comprehensive income (loss), net of tax | 53 | 6 | 22 | (28 | ) | 53 | ||||||||||||||
Comprehensive income (loss) attributable to Hertz | $ | 385 | $ | 1,198 | $ | 3,491 | $ | (4,689 | ) | $ | 385 |
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||
Balance as of January 1, 2021 | $ | (122) | $ | (71) | $ | (19) | $ | (212) | |||||||||||||||
Other comprehensive income (loss) before reclassification | 22 | (36) | — | (14) | |||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 12 | — | — | 12 | |||||||||||||||||||
Balance as of December 31, 2021 | $ | (88) | $ | (107) | $ | (19) | $ | (214) |
(In millions) | Pension and Other Post-Employment Benefits | Foreign Currency Items | Unrealized Losses from Currency Translation Adjustments on Terminated Net Investment Hedges | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||
Balance as of January 1, 2020 | $ | (118) | $ | (52) | $ | (19) | $ | (189) | |||||||||||||||
Other comprehensive income (loss) before reclassification | (15) | (19) | — | (34) | |||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 11 | — | — | 11 | |||||||||||||||||||
Balance as of December 31, 2020 | $ | (122) | $ | (71) | $ | (19) | $ | (212) |
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | |||||||||||||||
Net cash provided by (used in) operating activities | $ | 330 | $ | 4 | $ | 5,471 | $ | (2,898 | ) | $ | 2,907 | ||||||||
Cash flows from investing activities: | |||||||||||||||||||
Revenue earning vehicles expenditures | (507 | ) | — | (13,207 | ) | — | (13,714 | ) | |||||||||||
Proceeds from disposal of revenue earning vehicles | 368 | — | 9,118 | — | 9,486 | ||||||||||||||
Non-vehicle capital asset expenditures | (191 | ) | (8 | ) | (25 | ) | — | (224 | ) | ||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 23 | — | 4 | — | 27 | ||||||||||||||
Acquisitions, net of cash acquired | (1 | ) | — | — | — | (1 | ) | ||||||||||||
Other | 1 | — | — | — | 1 | ||||||||||||||
Capital contributions to subsidiaries | (2,997 | ) | — | — | 2,997 | — | |||||||||||||
Return of capital from subsidiaries | 2,906 | — | — | (2,906 | ) | — | |||||||||||||
Proceeds from/repayments of intercompany loan | — | — | 106 | (106 | ) | — | |||||||||||||
Net cash provided by (used in) investing activities | (398 | ) | (8 | ) | (4,004 | ) | (15 | ) | (4,425 | ) | |||||||||
Cash flows from financing activities: | |||||||||||||||||||
Proceeds from issuance of vehicle debt | 1,029 | — | 11,984 | — | 13,013 | ||||||||||||||
Repayments of vehicle debt | (1,029 | ) | — | (10,501 | ) | — | (11,530 | ) | |||||||||||
Proceeds from issuance of non-vehicle debt | 3,016 | — | — | — | 3,016 | ||||||||||||||
Repayments of non-vehicle debt | (3,732 | ) | — | — | — | (3,732 | ) | ||||||||||||
Payment of financing costs | (18 | ) | — | (35 | ) | — | (53 | ) | |||||||||||
Early redemption premium payment | (34 | ) | — | — | — | (34 | ) | ||||||||||||
Advances to Hertz Holdings | (12 | ) | — | — | — | (12 | ) | ||||||||||||
Contributions from noncontrolling interests | — | — | 49 | — | 49 | ||||||||||||||
Contributions from Hertz Holdings | 750 | — | — | — | 750 | ||||||||||||||
Capital contributions received from parent | — | — | 2,997 | (2,997 | ) | — | |||||||||||||
Payment of dividends and return of capital | — | — | (5,804 | ) | 5,804 | — | |||||||||||||
Proceeds from/repayments of intercompany loan | (106 | ) | — | — | 106 | — | |||||||||||||
Net cash provided by (used in) financing activities | (136 | ) | — | (1,310 | ) | 2,913 | 1,467 | ||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | — | — | 1 | — | 1 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | (204 | ) | (4 | ) | 158 | — | (50 | ) | |||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period | 713 | 11 | 686 | — | 1,410 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | $ | 509 | $ | 7 | $ | 844 | $ | — | $ | 1,360 |
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | |||||||||||||||
Net cash provided by (used in) operating activities | $ | 468 | $ | 5 | $ | 4,684 | $ | (2,594 | ) | $ | 2,563 | ||||||||
Cash flows from investing activities: | |||||||||||||||||||
Revenue earning vehicles expenditures | (408 | ) | — | (12,085 | ) | — | (12,493 | ) | |||||||||||
Proceeds from disposal of revenue earning vehicles | 276 | — | 8,176 | — | 8,452 | ||||||||||||||
Non-vehicle capital asset expenditures | (134 | ) | (10 | ) | (33 | ) | — | (177 | ) | ||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 36 | — | 15 | — | 51 | ||||||||||||||
Purchase of marketable securities | (60 | ) | — | — | — | (60 | ) | ||||||||||||
Sales of marketable securities | 36 | — | — | — | 36 | ||||||||||||||
Acquisitions, net of cash acquired | (2 | ) | — | — | — | (2 | ) | ||||||||||||
Other | — | — | (4 | ) | — | (4 | ) | ||||||||||||
Capital contributions to subsidiaries | (3,178 | ) | — | — | 3,178 | — | |||||||||||||
Return of capital from subsidiaries | 2,832 | — | — | (2,832 | ) | — | |||||||||||||
Net cash provided by (used in) investing activities | (602 | ) | (10 | ) | (3,931 | ) | 346 | (4,197 | ) | ||||||||||
Cash flows from financing activities: | |||||||||||||||||||
Proceeds from issuance of vehicle debt | 2,328 | — | 11,681 | — | 14,009 | ||||||||||||||
Repayments of vehicle debt | (2,368 | ) | — | (10,058 | ) | — | (12,426 | ) | |||||||||||
Proceeds from issuance of non-vehicle debt | 557 | — | — | — | 557 | ||||||||||||||
Repayments of non-vehicle debt | (571 | ) | — | — | — | (571 | ) | ||||||||||||
Payment of financing costs | (1 | ) | — | (46 | ) | — | (47 | ) | |||||||||||
Early redemption premium payment | — | — | (19 | ) | — | (19 | ) | ||||||||||||
Advances to Hertz Holdings | (9 | ) | — | — | — | (9 | ) | ||||||||||||
Contributions from noncontrolling interests | — | — | 60 | — | 60 | ||||||||||||||
Capital contributions received from parent | — | — | 3,178 | (3,178 | ) | — | |||||||||||||
Payment of dividends and return of capital | — | — | (5,426 | ) | 5,426 | — | |||||||||||||
Net cash provided by (used in) financing activities | (64 | ) | — | (630 | ) | 2,248 | 1,554 | ||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | — | — | (14 | ) | — | (14 | ) | ||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | (198 | ) | (5 | ) | 109 | — | (94 | ) | |||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period | 911 | 16 | 577 | — | 1,504 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | $ | 713 | $ | 11 | $ | 686 | $ | — | $ | 1,410 |
Parent (The Hertz Corporation) | Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Eliminations | The Hertz Corporation & Subsidiaries | |||||||||||||||
Net cash provided by (used in) operating activities | $ | 246 | $ | 28 | $ | 3,501 | $ | (1,376 | ) | $ | 2,399 | ||||||||
Cash flows from investing activities: | |||||||||||||||||||
Revenue earning vehicles expenditures | (314 | ) | (5 | ) | (10,277 | ) | — | (10,596 | ) | ||||||||||
Proceeds from disposal of revenue earning vehicles | 213 | — | 7,440 | — | 7,653 | ||||||||||||||
Non-vehicle capital asset expenditures | (122 | ) | (11 | ) | (40 | ) | — | (173 | ) | ||||||||||
Proceeds from non-vehicle capital assets disposed of or to be disposed of | 7 | — | 14 | — | 21 | ||||||||||||||
Proceeds from sale of Brazil Operations, net of retained cash | — | — | 94 | — | 94 | ||||||||||||||
Sales of marketable securities | — | — | 9 | — | 9 | ||||||||||||||
Return of (investment in) equity investment | 7 | — | — | — | 7 | ||||||||||||||
Acquisitions, net of cash acquired | — | (10 | ) | (5 | ) | — | (15 | ) | |||||||||||
Capital contributions to subsidiaries | (2,979 | ) | — | — | 2,979 | — | |||||||||||||
Return of capital from subsidiaries | 2,861 | — | — | (2,861 | ) | — | |||||||||||||
Proceeds from/repayments of intercompany loan | — | — | 19 | (19 | ) | — | |||||||||||||
Net cash provided by (used in) investing activities | (327 | ) | (26 | ) | (2,746 | ) | 99 | (3,000 | ) | ||||||||||
Cash flows from financing activities: | |||||||||||||||||||
Proceeds from issuance of vehicle debt | 1,789 | — | 8,967 | — | 10,756 | ||||||||||||||
Repayments of vehicle debt | (1,796 | ) | — | (8,448 | ) | — | (10,244 | ) | |||||||||||
Proceeds from issuance of non-vehicle debt | 2,100 | — | — | — | 2,100 | ||||||||||||||
Repayments of non-vehicle debt | (1,560 | ) | — | — | — | (1,560 | ) | ||||||||||||
Payment of financing costs | (23 | ) | (4 | ) | (32 | ) | — | (59 | ) | ||||||||||
Early redemption premium payment | (5 | ) | — | — | — | (5 | ) | ||||||||||||
Advances to Hertz Holdings | (6 | ) | — | — | — | (6 | ) | ||||||||||||
Other | 1 | — | — | — | 1 | ||||||||||||||
Capital contributions received from parent | — | — | 2,979 | (2,979 | ) | — | |||||||||||||
Payment of dividends and return of capital | — | — | (4,237 | ) | 4,237 | — | |||||||||||||
Proceeds from/repayments of intercompany loan | (19 | ) | — | — | 19 | — | |||||||||||||
Net cash provided by (used in) financing activities | 481 | (4 | ) | (771 | ) | 1,277 | 983 | ||||||||||||
Effect of foreign currency exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | — | — | 28 | — | 28 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | 400 | (2 | ) | 12 | — | 410 | |||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period | 511 | 18 | 565 | — | 1,094 | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | $ | 911 | $ | 16 | $ | 577 | $ | — | $ | 1,504 |
Years Ended December 31, | |||||||||||||||||
(In millions, except per share data) | 2021 | 2020 | 2019 | ||||||||||||||
Numerator: | |||||||||||||||||
Net income (loss) attributable to Hertz Global | $ | 366 | $ | (1,714) | $ | (58) | |||||||||||
Series A Preferred Stock deemed dividends(1) | (450) | — | — | ||||||||||||||
Net income (loss) available to Hertz Global common stockholders | $ | (84) | $ | (1,714) | $ | (58) | |||||||||||
Denominator: | |||||||||||||||||
Basic weighted-average common shares outstanding | 315 | 150 | 84 | ||||||||||||||
2019 Rights Offering adjustment(2) | — | — | 33 | ||||||||||||||
Diluted weighted-average common shares outstanding | 315 | 150 | 117 | ||||||||||||||
Antidilutive Public Warrants | 14 | — | — | ||||||||||||||
Antidilutive stock options, RSUs, PSUs and PSAs | 1 | 2 | 2 | ||||||||||||||
Total antidilutive | 15 | 2 | 2 | ||||||||||||||
Earnings (loss) per common share: | |||||||||||||||||
Basic | $ | (0.27) | $ | (11.44) | $ | (0.49) | |||||||||||
Diluted | $ | (0.27) | $ | (11.44) | $ | (0.49) |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Revenues | |||||||||||||||||
Americas RAC | $ | 6,215 | $ | 3,756 | $ | 7,208 | |||||||||||
International RAC | 985 | 872 | 1,899 | ||||||||||||||
Total reportable segments | 7,200 | 4,628 | 9,107 | ||||||||||||||
All other operations(1) | 136 | 630 | 672 | ||||||||||||||
Total Hertz Global and Hertz | $ | 7,336 | $ | 5,258 | $ | 9,779 | |||||||||||
Depreciation of revenue earning vehicles and lease charges | |||||||||||||||||
Americas RAC | $ | 343 | $ | 1,352 | $ | 1,706 | |||||||||||
International RAC | 154 | 243 | 388 | ||||||||||||||
Total reportable segments | 497 | 1,595 | 2,094 | ||||||||||||||
All other operations(1)(2) | — | 435 | 469 | ||||||||||||||
Total Hertz Global and Hertz | $ | 497 | $ | 2,030 | $ | 2,563 | |||||||||||
Depreciation and amortization, non-vehicle assets | |||||||||||||||||
Americas RAC | $ | 166 | $ | 182 | $ | 159 | |||||||||||
International RAC | 16 | 19 | 20 | ||||||||||||||
Total reportable segments | 182 | 201 | 179 | ||||||||||||||
All other operations(1) | 2 | 10 | 10 | ||||||||||||||
Corporate | 12 | 14 | 14 | ||||||||||||||
Total Hertz Global and Hertz | $ | 196 | $ | 225 | $ | 203 | |||||||||||
Interest expense, net | |||||||||||||||||
Americas RAC | $ | 198 | $ | 259 | $ | 166 | |||||||||||
International RAC | 62 | 80 | 84 | ||||||||||||||
Total reportable segments | 260 | 339 | 250 | ||||||||||||||
All other operations(1) | 13 | 40 | 31 | ||||||||||||||
Corporate | 196 | 229 | 524 | ||||||||||||||
Total Hertz Global | 469 | 608 | 805 | ||||||||||||||
Hertz interest income from loan to Hertz Global | — | (2) | (7) | ||||||||||||||
Total - Hertz | $ | 469 | $ | 606 | $ | 798 | |||||||||||
Adjusted EBITDA | |||||||||||||||||
Americas RAC | $ | 2,173 | $ | (810) | $ | 512 | |||||||||||
International RAC | 90 | (229) | 115 | ||||||||||||||
Total reportable segments | 2,263 | (1,039) | 627 | ||||||||||||||
All other operations(1) | 13 | 93 | 100 | ||||||||||||||
Corporate | (146) | (49) | (78) | ||||||||||||||
Total Hertz Global and Hertz | $ | 2,130 | $ | (995) | $ | 649 |
As of December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
Revenue earning vehicles, net | |||||||||||
Americas RAC | $ | 7,897 | $ | 5,120 | |||||||
International RAC | 1,329 | 942 | |||||||||
Total reportable segments | 9,226 | 6,062 | |||||||||
All other operations(1)(3) | — | 1,432 | |||||||||
Total Hertz Global and Hertz | $ | 9,226 | $ | 7,494 | |||||||
Property and equipment, net | |||||||||||
Americas RAC | $ | 449 | $ | 490 | |||||||
International RAC | 67 | 78 | |||||||||
Total reportable segments | 516 | 568 | |||||||||
All other operations(1)(4) | — | 6 | |||||||||
Corporate | 92 | 98 | |||||||||
Total Hertz Global and Hertz | $ | 608 | $ | 672 | |||||||
Total assets | |||||||||||
Americas RAC | $ | 14,352 | $ | 11,337 | |||||||
International RAC | 2,978 | 2,661 | |||||||||
Total reportable segments | 17,330 | 13,998 | |||||||||
All other operations(1)(5) | — | 1,818 | |||||||||
Corporate | 2,453 | 1,092 | |||||||||
Total Hertz Global(6) | 19,783 | 16,908 | |||||||||
Corporate - Hertz(7) | (3) | (28) | |||||||||
Total Hertz(6) | $ | 19,780 | $ | 16,880 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Revenue earning vehicles and non-vehicle capital assets | |||||||||||||||||
Americas RAC: | |||||||||||||||||
Expenditures | $ | (5,935) | $ | (4,059) | $ | (9,790) | |||||||||||
Proceeds from disposals | 2,137 | 7,965 | 6,643 | ||||||||||||||
Net expenditures - Hertz Global and Hertz | $ | (3,798) | $ | 3,906 | $ | (3,147) | |||||||||||
International RAC: | |||||||||||||||||
Expenditures | $ | (1,123) | $ | (930) | $ | (2,995) | |||||||||||
Proceeds from disposals | 626 | 1,855 | 2,517 | ||||||||||||||
Net expenditures - Hertz Global and Hertz | $ | (497) | $ | 925 | $ | (478) | |||||||||||
All other operations: | |||||||||||||||||
Expenditures | $ | (155) | $ | (615) | $ | (1,043) | |||||||||||
Proceeds from disposals | 70 | 335 | 352 | ||||||||||||||
Net expenditures - Hertz Global and Hertz | $ | (85) | $ | (280) | $ | (691) | |||||||||||
Corporate: | |||||||||||||||||
Expenditures | $ | (12) | $ | (36) | $ | (110) | |||||||||||
Proceeds from disposals | 1 | 3 | 1 | ||||||||||||||
Net expenditures - Hertz Global and Hertz | $ | (11) | $ | (33) | $ | (109) |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Revenues | |||||||||||||||||
U.S. | $ | 6,186 | $ | 4,271 | $ | 7,596 | |||||||||||
International | 1,150 | 987 | 2,183 | ||||||||||||||
Total Hertz Global and Hertz | $ | 7,336 | $ | 5,258 | $ | 9,779 |
As of December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
Revenue earning vehicles, net | |||||||||||
U.S. | $ | 7,639 | $ | 4,974 | |||||||
International | 1,587 | 1,088 | |||||||||
Total Hertz Global and Hertz | $ | 9,226 | $ | 6,062 | |||||||
Property and equipment, net | |||||||||||
U.S. | $ | 527 | $ | 570 | |||||||
International | 81 | 96 | |||||||||
Total Hertz Global and Hertz | $ | 608 | $ | 666 | |||||||
As of December 31, | |||||||||||
(In millions) | 2021 | 2020 | |||||||||
Total assets | |||||||||||
U.S.(1) | $ | 16,174 | $ | 13,732 | |||||||
International(2) | 3,609 | 3,176 | |||||||||
Total Hertz Global | 19,783 | 16,908 | |||||||||
U.S. - Hertz | (3) | (28) | |||||||||
Total Hertz | $ | 19,780 | $ | 16,880 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Adjusted EBITDA: | |||||||||||||||||
Americas RAC | $ | 2,173 | $ | (810) | $ | 512 | |||||||||||
International RAC | 90 | (229) | 115 | ||||||||||||||
Total reportable segments | 2,263 | (1,039) | 627 | ||||||||||||||
All other operations(1) | 13 | 93 | 100 | ||||||||||||||
Corporate(2) | (146) | (49) | (78) | ||||||||||||||
Total Hertz Global | 2,130 | (995) | 649 | ||||||||||||||
Adjustments: | |||||||||||||||||
Non-vehicle depreciation and amortization | (196) | (225) | (203) | ||||||||||||||
Non-vehicle debt interest, net(3) | (185) | (153) | (311) | ||||||||||||||
Vehicle debt-related charges(4) | (72) | (55) | (38) | ||||||||||||||
Restructuring and restructuring related charges(5) | (76) | (64) | (14) | ||||||||||||||
Technology-related intangible and other asset impairments(6) | — | (213) | — | ||||||||||||||
Information technology and finance transformation costs(7) | (12) | (42) | (114) | ||||||||||||||
Reorganization items, net(8) | (677) | (175) | — | ||||||||||||||
Pre-reorganization charges and non-debtor financing charges(9) | (42) | (109) | — | ||||||||||||||
Gain from the Donlen Sale(10) | 400 | — | — | ||||||||||||||
Change in fair value of Public Warrants(11) | (627) | — | — | ||||||||||||||
Other items(12) | 40 | (21) | 44 | ||||||||||||||
Income (loss) before income taxes | $ | 683 | $ | (2,052) | $ | 13 |
Years Ended December 31, | |||||||||||||||||
(In millions) | 2021 | 2020 | 2019 | ||||||||||||||
Adjusted EBITDA: | |||||||||||||||||
Americas RAC | $ | 2,173 | $ | (810) | $ | 512 | |||||||||||
International RAC | 90 | (229) | 115 | ||||||||||||||
Total reportable segments | 2,263 | (1,039) | 627 | ||||||||||||||
All other operations(1) | 13 | 93 | 100 | ||||||||||||||
Corporate(2) | (146) | (49) | (78) | ||||||||||||||
Total Hertz | 2,130 | (995) | 649 | ||||||||||||||
Adjustments: | |||||||||||||||||
Non-vehicle depreciation and amortization | (196) | (225) | (203) | ||||||||||||||
Non-vehicle debt interest, net(3) | (185) | (151) | (304) | ||||||||||||||
Vehicle debt-related charges(4) | (72) | (55) | (38) | ||||||||||||||
Restructuring and restructuring related charges(5) | (76) | (64) | (14) | ||||||||||||||
Technology-related intangible and other asset impairments(6) | — | (213) | — | ||||||||||||||
Write-off of intercompany loan(13) | — | (133) | — | ||||||||||||||
Information technology and finance transformation costs(7) | (12) | (42) | (114) | ||||||||||||||
Reorganization items, net(8) | (513) | (175) | — | ||||||||||||||
Pre-reorganization charges and non-debtor financing charges(9) | (42) | (109) | — | ||||||||||||||
Gain from the Donlen Sale(10) | 400 | — | — | ||||||||||||||
Other items(12) | 40 | (21) | 44 | ||||||||||||||
Income (loss) before income taxes | $ | 1,474 | $ | (2,183) | $ | 20 |
(In millions) | December 31, 2020 | ||||
Accounts payable | $ | 267 | |||
Accrued liabilities(1) | 166 | ||||
Accrued taxes, net | 19 | ||||
Accrued interest on debt subject to compromise | 70 | ||||
Debt subject to compromise(2) | 4,443 | ||||
Liabilities subject to compromise - Hertz Global | 4,965 | ||||
Due from affiliate - Hertz(3) | 65 | ||||
Liabilities subject to compromise - Hertz | $ | 5,030 |
(In millions) | Effective Date | ||||||||||
Reinstated on the Effective Date: | |||||||||||
Accounts payable | $ | 257 | |||||||||
Accrued liabilities | 99 | ||||||||||
Accrued taxes, net | 14 | ||||||||||
Liabilities reinstated - Hertz Global | 370 | ||||||||||
Stockholder's equity - Due to affiliate - Hertz(1) | 65 | ||||||||||
Liabilities reinstated - Hertz | $ | 435 |
Years Ended December 31, | |||||||||||||||||||||||
(In millions) | 2021 | 2020 | |||||||||||||||||||||
Professional fees and other bankruptcy related costs | $ | 257 | $ | 175 | |||||||||||||||||||
Loss on extinguishment of debt(1) | 191 | — | |||||||||||||||||||||
Backstop fee | 164 | — | |||||||||||||||||||||
Breakup fee(2) | 77 | — | |||||||||||||||||||||
Contract settlements | 25 | — | |||||||||||||||||||||
Cancellation of share-based compensation grants(3) | (10) | — | |||||||||||||||||||||
Net gain on settlement of liabilities subject to compromise | (22) | — | |||||||||||||||||||||
Other, net | (5) | — | |||||||||||||||||||||
Reorganization items, net | $ | 677 | $ | 175 |
Years Ended December 31, | |||||||||||||||||||||||
(In millions) | 2021 | 2020 | |||||||||||||||||||||
Professional fees and other bankruptcy related costs | $ | 257 | $ | 175 | |||||||||||||||||||
Loss on extinguishment of debt(1) | 191 | — | |||||||||||||||||||||
Breakup fee(2) | 77 | — | |||||||||||||||||||||
Contract settlements | 25 | — | |||||||||||||||||||||
Cancellation of share-based compensation grants(3) | (10) | — | |||||||||||||||||||||
Net gain on settlement of liabilities subject to compromise | (22) | — | |||||||||||||||||||||
Other, net | (5) | — | |||||||||||||||||||||
Reorganization items, net | $ | 513 | $ | 175 |
December 31, | |||||||||||
2021 | 2020 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 1 | $ | — | |||||||
Restricted cash and restricted cash equivalents | — | 28 | |||||||||
Total cash, cash equivalents, restricted cash and restricted cash equivalents | 1 | 28 | |||||||||
Non-vehicle receivables, net of allowance | 1 | — | |||||||||
Prepaid expenses and other assets | 1 | 1 | |||||||||
Investments in subsidiaries, net | 4,350 | — | |||||||||
Deferred income taxes, net | 2 | 5 | |||||||||
Due from Hertz | — | 65 | |||||||||
Total assets | $ | 4,355 | $ | 99 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Accrued liabilities | $ | 54 | $ | — | |||||||
Public Warrants | 1,324 | — | |||||||||
Due to Hertz | — | 1 | |||||||||
Investments in subsidiaries, net | — | 42 | |||||||||
Total liabilities | 1,378 | 43 | |||||||||
Stockholders' equity: | |||||||||||
Preferred stock, $0.01 par value, no shares issued and outstanding | — | — | |||||||||
Common stock, $0.01 par value, 477,233,278 and 158,235,410 shares issued, respectively and 449,782,424 and 156,206,478 shares outstanding, respectively | 5 | 2 | |||||||||
Additional paid-in capital | 6,209 | 3,047 | |||||||||
Accumulated deficit | (2,315) | (2,681) | |||||||||
Accumulated other comprehensive income (loss) | (214) | (212) | |||||||||
Equity before treasury stock | 3,685 | 156 | |||||||||
Treasury stock, at cost, 27,450,854 and 2,028,932 common shares as of December 31, 2021 and 2020, respectively | (708) | (100) | |||||||||
Total stockholders' equity | 2,977 | 56 | |||||||||
Total liabilities and stockholders' equity | $ | 4,355 | $ | 99 |
December 31, | |||||||
2019 | 2018 | ||||||
ASSETS | |||||||
Investments in subsidiaries, net | $ | 1,765 | $ | 1,059 | |||
Deferred income taxes, net | 4 | 2 | |||||
Total assets | $ | 1,769 | $ | 1,061 | |||
STOCKHOLDERS' EQUITY | |||||||
Preferred stock, $0.01 par value, no shares issued and outstanding | $ | — | $ | — | |||
Common stock, $0.01 par value, 144 and 86 shares issued, respectively and 142 and 84 shares outstanding, respectively | 1 | 1 | |||||
Additional paid-in capital | 3,024 | 2,261 | |||||
Accumulated deficit | (967 | ) | (909 | ) | |||
Accumulated other comprehensive income (loss) | (189 | ) | (192 | ) | |||
1,869 | 1,161 | ||||||
Treasury stock, at cost, 2 shares and 2 shares, respectively | (100 | ) | (100 | ) | |||
Total stockholders' equity | $ | 1,769 | $ | 1,061 |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Total Revenues | $ | — | $ | — | $ | — | |||||
Expenses: | |||||||||||
Interest expense, net | 7 | 7 | 5 | ||||||||
Total expenses | 7 | 7 | 5 | ||||||||
Income (loss) before income taxes and equity in earnings (losses) of subsidiaries | (7 | ) | (7 | ) | (5 | ) | |||||
Income tax (provision) benefit | 2 | 2 | — | ||||||||
Equity in earnings (losses) of subsidiaries, net of tax | (53 | ) | (220 | ) | 332 | ||||||
Net income (loss) | $ | (58 | ) | $ | (225 | ) | $ | 327 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Total Revenues | $ | — | $ | — | $ | — | |||||||||||
Expenses: | |||||||||||||||||
Interest expense, net | — | 2 | 7 | ||||||||||||||
Write-off of intercompany loan | — | (133) | — | ||||||||||||||
Reorganization items net | 164 | — | — | ||||||||||||||
Change in fair value of Public Warrants | 627 | — | — | ||||||||||||||
Total expenses | 791 | (131) | 7 | ||||||||||||||
Income (loss) before income taxes and equity in earnings (losses) of subsidiaries | (791) | 131 | (7) | ||||||||||||||
Income tax (provision) benefit | — | 1 | 2 | ||||||||||||||
Equity in earnings (losses) of subsidiaries, net of tax | 1,157 | (1,846) | (53) | ||||||||||||||
Net income (loss) | 366 | (1,714) | (58) | ||||||||||||||
Series A Preferred Stock deemed dividends | (450) | — | — | ||||||||||||||
Net income (loss) available to Hertz Holdings common stockholders | $ | (84) | $ | (1,714) | $ | (58) |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net income (loss) | $ | (58 | ) | $ | (225 | ) | $ | 327 | |||
Total other comprehensive income (loss) | 3 | (63 | ) | 53 | |||||||
Total comprehensive income (loss) | $ | (55 | ) | $ | (288 | ) | $ | 380 |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net income (loss) | $ | 366 | $ | (1,714) | $ | (58) | |||||||||||
Total other comprehensive income (loss) | (2) | (23) | 3 | ||||||||||||||
Total comprehensive income (loss) | $ | 364 | $ | (1,737) | $ | (55) |
Years Ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net cash provided by (used in) operating activities | $ | (7 | ) | $ | (7 | ) | $ | (5 | ) | ||
Cash flows from financing activities: | |||||||||||
Proceeds from loans with Hertz | 12 | 9 | 6 | ||||||||
Proceeds from Rights Offering, net | 748 | — | — | ||||||||
Contributions to Hertz | (750 | ) | — | — | |||||||
Other | (3 | ) | (2 | ) | (1 | ) | |||||
Net cash provided by (used in) financing activities | 7 | 7 | 5 | ||||||||
Net increase (decrease) in cash and cash equivalents during the period | — | — | — | ||||||||
Cash and cash equivalents at beginning of period | — | — | — | ||||||||
Cash and cash equivalents at end of period | $ | — | $ | — | $ | — |
Years Ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net cash provided by (used in) operating activities | $ | — | $ | (3) | $ | (7) | |||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from loans with Hertz | — | 5 | 12 | ||||||||||||||
Proceeds from Plan Sponsors | 2,781 | — | — | ||||||||||||||
Proceeds from rights offerings, net | 1,639 | — | 748 | ||||||||||||||
Contributions to Hertz | (5,642) | — | (750) | ||||||||||||||
Proceeds from exercises of Public Warrants | 77 | — | — | ||||||||||||||
Proceeds from issuance of preferred stock | 1,433 | — | — | ||||||||||||||
Distributions to common stockholders | (239) | — | — | ||||||||||||||
Purchases of treasury shares | (654) | — | — | ||||||||||||||
Repurchase of preferred stock | (1,883) | — | — | ||||||||||||||
Payments for Nasdaq listing costs | (9) | — | — | ||||||||||||||
Dividends from Hertz | 2,470 | — | — | ||||||||||||||
Proceeds from issuance of stock, net | — | 28 | — | ||||||||||||||
Other | — | (2) | (3) | ||||||||||||||
Net cash provided by (used in) financing activities | (27) | 31 | 7 | ||||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents during the period | (27) | 28 | — | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period | 28 | — | — | ||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | $ | 1 | $ | 28 | $ | — | |||||||||||
Balance at Beginning of Period | Additions | ||||||||||||||||||||||||||||
Charged to Expense | Translation Adjustments | Deductions | Balance at End of Period | ||||||||||||||||||||||||||
Receivables allowances: | |||||||||||||||||||||||||||||
Year ended December 31, 2021 | $ | 46 | $ | 125 | $ | — | $ | (121) | (1) | $ | 50 | ||||||||||||||||||
Year ended December 31, 2020 | 35 | 94 | (2) | — | (83) | (1)(2) | 46 | ||||||||||||||||||||||
Year ended December 31, 2019 | 27 | 53 | — | (45) | (1) | 35 | |||||||||||||||||||||||
Tax valuation allowances: | |||||||||||||||||||||||||||||
Year ended December 31, 2021 | $ | 651 | $ | 78 | $ | (39) | $ | — | $ | 690 | |||||||||||||||||||
Year ended December 31, 2020 | 396 | 218 | 37 | — | 651 | ||||||||||||||||||||||||
Year ended December 31, 2019 | 318 | 75 | 3 | — | 396 |
Balance at Beginning of Period | Additions | ||||||||||||||||||
Charged to Expense | Translation Adjustments | Deductions | Balance at End of Period | ||||||||||||||||
Receivables allowances: | |||||||||||||||||||
Year Ended December 31, 2019 | $ | 27 | $ | 53 | $ | — | $ | (45 | ) | (1) | $ | 35 | |||||||
Year Ended December 31, 2018 | 33 | 35 | (1 | ) | (40 | ) | (1) | 27 | |||||||||||
Year Ended December 31, 2017 | 42 | 33 | 3 | (45 | ) | (1) | 33 | ||||||||||||
Tax valuation allowances: | |||||||||||||||||||
Year Ended December 31, 2019 | $ | 318 | $ | 75 | $ | 3 | $ | — | $ | 396 | |||||||||
Year Ended December 31, 2018 | 305 | 21 | 1 | (9 | ) | (2) | 318 | ||||||||||||
Year Ended December 31, 2017 | 230 | 57 | 18 | — | 305 |
Equity compensation plans approved by security holders | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (excluding RSUs / PSUs) (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | |||||||
Omnibus Plan | 4,347,866 | $ | 28.36 | 6,328,163 |
(In millions) | 2019 | ||
Audit fees(1) | $ | 9 | |
Audit-related fees(2) | — | ||
Tax fees(3) | — | ||
Total | $ | 9 |
(In millions) | 2021 | 2020 | |||||||||||||||
Audit fees(1) | $ | 14 | $ | 12 | |||||||||||||
Audit-related fees(2) | 1 | 2 | |||||||||||||||
Tax fees | — | — | |||||||||||||||
Total | $ | 15 | $ | 14 |
(In millions) | 2018 | ||
Audit fees(1) | $ | 13 | |
Audit-related fees(2) | 1 | ||
Tax fees(3) | 1 | ||
Total | $ | 15 |
(2) Audit-related fees were for services rendered in connection with due diligence and assurance services and employee benefit plan audits. |
Page | |||||||||||
(a) | 1. | Financial Statements: | |||||||||
Our financial statements filed herewith are set forth in Part II, Item 8 of this | |||||||||||
(A) Hertz Global Holdings, Inc. and Subsidiaries— | |||||||||||
Reports of Independent Registered Public Accounting | |||||||||||
Consolidated Balance Sheets | |||||||||||
Consolidated Statements of Operations | |||||||||||
Consolidated Statements of Comprehensive Income (Loss) | |||||||||||
Consolidated Statements of Changes in Equity | |||||||||||
Consolidated Statements of Cash Flows | |||||||||||
Notes to Consolidated Financial Statements | |||||||||||
(B) The Hertz Corporation and Subsidiaries— | |||||||||||
Reports of Independent Registered Public Accounting | |||||||||||
Consolidated Balance Sheets | |||||||||||
Consolidated Statements of Operations | |||||||||||
Consolidated Statements of Comprehensive Income (Loss) | |||||||||||
Consolidated Statements of Changes in Equity | |||||||||||
Consolidated Statements of Cash Flows | |||||||||||
Notes to Consolidated Financial Statements | |||||||||||
2. | Financial Statement Schedules: | ||||||||||
Our financial statement schedules filed herewith are set forth in Part II, Item 8 of this | |||||||||||
(A) Hertz Global Holdings, Inc.—Schedule I—Condensed Financial Information of Registrant | |||||||||||
(B) Hertz Global Holdings, Inc. and Subsidiaries and The Hertz Corporation and Subsidiaries-Schedule II—Valuation and Qualifying Accounts | |||||||||||
3. | Exhibits: | ||||||||||
The attached list of exhibits in the “Exhibit Index” immediately following the signature |
HERTZ GLOBAL HOLDINGS, INC. THE HERTZ CORPORATION (Registrants) | ||||||||
/s/ KENNY CHEUNG | ||||||||
Name: | Kenny Cheung | |||||||
Executive Vice President and Chief Financial Officer |
Signature | Title | ||||||||||||||||
/s/ | |||||||||||||||||
/s/ | |||||||||||||||||
Executive Vice President and Chief Financial Officer of the Registrants | |||||||||||||||||
/s/ | Senior Vice President and Chief Accounting Officer of the Registrants | ||||||||||||||||
/s/ MICHAEL GREGORY O'HARA | Chairperson of Hertz Global Holdings, Inc. | ||||||||||||||||
Michael Gregory O'Hara | |||||||||||||||||
/s/ THOMAS WAGNER | Vice Chairperson of Hertz Global Holdings, Inc. | ||||||||||||||||
Thomas Wagner | |||||||||||||||||
/s/ COLIN FARMER | Director of Hertz Global Holdings, Inc. | ||||||||||||||||
Colin Farmer | |||||||||||||||||
/s/ JENNIFER FEIKIN | Director of Hertz Global Holdings, Inc. | ||||||||||||||||
Jennifer Feikin | |||||||||||||||||
/s/ VINCENT J. INTRIERI | Director of Hertz Global Holdings, Inc. | ||||||||||||||||
Vincent J. Intrieri | |||||||||||||||||
/s/ | Director of Hertz Global Holdings, Inc. | ||||||||||||||||
/s/ | Director of Hertz Global Holdings, Inc. | ||||||||||||||||
/s/ | Director of The Hertz Corporation | ||||||||||||||||
/s/ M. | Director of The Hertz Corporation | ||||||||||||||||
M. David Galainena |
Exhibit Number | Description | |||||||
2 | Hertz Holdings Hertz | |||||||
2.1 | Hertz Holdings Hertz | |||||||
3.1.1 | Hertz Holdings | Second Amended and Restated Certificate of Incorporation of Hertz Global Holdings, Inc. | ||||||
3.1.2 | Hertz | |||||||
3.1.3 | Hertz | |||||||
3.1.4 | Hertz | |||||||
3.2.1 | Hertz Holdings | Second Amended and Restated | ||||||
3.2.2 | Hertz | |||||||
Hertz | ||||||||
Hertz | ||||||||
Hertz |
Exhibit Number | Description | |||||||
4.5 | Hertz Holdings Hertz | |||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz |
4.9 | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
4.13 | Hertz Holdings Hertz | |||||||
Hertz Holdings Hertz | ||||||||
Description | ||||||||
4.15 | Hertz Holdings Hertz | |||||||
Hertz Holdings Hertz | ||||||||
4.17 | Hertz Holdings Hertz | |||||||
4.18 | Hertz Holdings Hertz | |||||||
4.19 | Hertz Holdings Hertz | |||||||
10.1 | Hertz Holdings Hertz | |||||||
10.2 | Hertz Holdings Hertz | |||||||
10.3 | Hertz Holdings Hertz |
10.4.1 | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Exhibit Number | Description | |||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
10.7 | Hertz Holdings Hertz | |||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
10.11 | Hertz Holdings Hertz | |||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | ||||||||
Description | |||||||||
10.17.1 | Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | |||||||||
Hertz Holdings Hertz | |||||||||
10.19.1 | Hertz Holdings Hertz | ||||||||
10.19.2 | Hertz Holdings Hertz | ||||||||
10.20 | Hertz Holdings Hertz | ||||||||
Hertz Holdings Hertz | |||||||||
10.22 | Hertz Holdings Hertz | ||||||||
10.23 | Hertz Holdings Hertz | ||||||||
10.24 | Hertz Holdings Hertz | ||||||||
21.1 | Hertz Holdings Hertz | ||||||||
23.1 | Hertz Holdings | ||||||||
31.1 | Hertz Holdings | ||||||||
31.2 | Hertz Holdings | ||||||||
31.3 | Hertz | ||||||||
31.4 | Hertz | ||||||||
32.1 | Hertz Holdings | ||||||||
32.2 | Hertz Holdings |
Exhibit Number | Description | |||||||
Hertz | ||||||||
Hertz | ||||||||
101.INS | Hertz Holdings Hertz | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.* | ||||||
101.SCH | Hertz Holdings Hertz | Inline XBRL Taxonomy Extension Schema Document.* | ||||||
101.CAL | Hertz Holdings Hertz | Inline XBRL Taxonomy Extension Calculation Linkbase Document.* | ||||||
101.DEF | Hertz Holdings Hertz | Inline XBRL Taxonomy Extension Definition Linkbase Document.* | ||||||
101.LAB | Hertz Holdings Hertz | Inline XBRL Taxonomy Extension Label Linkbase Document.* | ||||||
101.PRE | Hertz Holdings Hertz | Inline XBRL Taxonomy Extension Presentation Linkbase Document.* | ||||||
104 | Hertz Holdings Hertz | Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit 101).* | ||||||