Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 14, 2019 | Jun. 29, 2018 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | HEES | ||
Entity Registrant Name | H&E Equipment Services, Inc. | ||
Entity Central Index Key | 1,339,605 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 35,754,246 | ||
Entity Public Float | $ 1,190,402,497 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Cash | $ 16,677 | $ 165,878 |
Receivables, net of allowance for doubtful accounts of $4,094 and $3,774, respectively | 201,556 | 176,081 |
Inventories, net of reserves for obsolescence of $368 and $947, respectively | 104,598 | 75,004 |
Prepaid expenses and other assets | 10,508 | 9,172 |
Rental equipment, net of accumulated depreciation of $582,520 and $495,940, respectively | 1,141,498 | 904,824 |
Property and equipment, net of accumulated depreciation and amortization of $142,662 and $131,500, respectively | 115,121 | 101,789 |
Deferred financing costs, net of accumulated amortization of $13,717 and $12,946, respectively | 3,000 | 3,772 |
Intangible assets, net of accumulated amortization of $3,320 at December 31, 2018 | 28,380 | |
Goodwill | 105,843 | 31,197 |
Total assets | 1,727,181 | 1,467,717 |
Liabilities: | ||
Amounts due on senior secured credit facility | 170,761 | |
Accounts payable | 101,840 | 89,781 |
Manufacturer flooring plans payable | 23,666 | 22,002 |
Accrued expenses payable and other liabilities | 73,371 | 65,095 |
Dividends payable | 132 | 150 |
Senior unsecured notes, net of unaccreted discount of $3,168 and $3,644 and deferred financing costs of $2,052 and $2,268, respectively | 944,780 | 944,088 |
Capital leases payable | 726 | 1,486 |
Deferred income taxes | 153,113 | 126,419 |
Deferred compensation payable | 1,989 | 1,903 |
Total liabilities | 1,470,378 | 1,250,924 |
Commitments and Contingencies (Note 13) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value, 25,000,000 shares authorized; no shares issued | ||
Common stock, $0.01 par value, 175,000,000 shares authorized; 39,748,562 and 39,623,773 shares issued at December 31, 2018 and 2017, respectively, and 35,733,569 and 35,646,585 shares outstanding at December 31, 2018 and 2017, respectively | 396 | 395 |
Additional paid-in capital | 231,174 | 227,070 |
Treasury stock at cost, 4,014,993 and 3,977,188 shares of common stock held at December 31, 2018 and 2017, respectively | (63,099) | (61,749) |
Retained earnings | 88,332 | 51,077 |
Total stockholders’ equity | 256,803 | 216,793 |
Total liabilities and stockholders’ equity | $ 1,727,181 | $ 1,467,717 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivables | $ 4,094 | $ 3,774 |
Reserves for obsolescence inventories | 368 | 947 |
Accumulated depreciation, rental equipment | 582,520 | 495,940 |
Accumulated depreciation and amortization, property and equipment | 142,662 | 131,500 |
Accumulated amortization, deferred financing costs | 13,717 | 12,946 |
Accumulated amortization, intangible assets | 3,320 | |
Unaccreted discount, net | 3,168 | 3,644 |
Deferred financing costs | $ 2,052 | $ 2,268 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 39,748,562 | 39,623,773 |
Common stock, shares outstanding | 35,733,569 | 35,646,585 |
Treasury stock, shares | 4,014,993 | 3,977,188 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||||||||||
Revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 |
Cost of revenues: | |||||||||||
Cost of revenues | 800,427 | 670,111 | 642,526 | ||||||||
Gross profit | 438,534 | 359,908 | 335,611 | ||||||||
Selling, general and administrative expenses | 278,298 | 232,784 | 228,129 | ||||||||
Merger costs (net of merger breakup fee proceeds) | 708 | (5,782) | |||||||||
Gain from sales of property and equipment, net | 7,118 | 5,009 | 3,285 | ||||||||
Income from operations | 50,899 | 45,318 | 43,103 | 27,326 | 40,268 | 47,654 | 28,668 | 21,325 | 166,646 | 137,915 | 110,767 |
Other income (expense): | |||||||||||
Interest expense | (63,707) | (54,958) | (53,604) | ||||||||
Loss on early extinguishment of debt | (25,400) | (25,363) | |||||||||
Other, net | 1,724 | 1,750 | 1,867 | ||||||||
Total other expense, net | (61,983) | (78,571) | (51,737) | ||||||||
Income before provision (benefit) for income taxes | 34,755 | 28,971 | 27,869 | 13,068 | 27,569 | 7,577 | 15,668 | 8,530 | 104,663 | 59,344 | 59,030 |
Provision (benefit) for income taxes | (5,900) | 28,040 | (50,314) | 21,858 | |||||||
Net income | $ 25,060 | $ 21,314 | $ 20,771 | $ 9,478 | $ 85,928 | $ 8,462 | $ 9,878 | $ 5,390 | $ 76,623 | $ 109,658 | $ 37,172 |
Net income per common share: | |||||||||||
Basic | $ 0.70 | $ 0.60 | $ 0.58 | $ 0.27 | $ 2.41 | $ 0.24 | $ 0.28 | $ 0.15 | $ 2.15 | $ 3.09 | $ 1.05 |
Diluted | $ 0.70 | $ 0.59 | $ 0.58 | $ 0.26 | $ 2.40 | $ 0.24 | $ 0.28 | $ 0.15 | $ 2.13 | $ 3.07 | $ 1.05 |
Weighted average common shares outstanding: | |||||||||||
Basic | 35,677 | 35,516 | 35,393 | ||||||||
Diluted | 35,903 | 35,699 | 35,480 | ||||||||
Dividends declared per common share outstanding | $ 1.10 | $ 1.10 | $ 1.10 | ||||||||
Rental Depreciation [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | $ 208,453 | $ 169,455 | $ 162,415 | ||||||||
Rental Expense [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 89,520 | 77,706 | 71,694 | ||||||||
Equipment Rentals [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 592,193 | 479,016 | 445,227 | ||||||||
Cost of revenues: | |||||||||||
Gross profit | 294,220 | 231,855 | 211,118 | ||||||||
Equipment Rentals [Member] | Rental Depreciation [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 208,453 | 169,455 | 162,415 | ||||||||
Equipment Rentals [Member] | Rental Expense [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 89,520 | 77,706 | 71,694 | ||||||||
New Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 262,948 | 203,301 | 196,688 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 232,057 | 180,702 | 175,556 | ||||||||
Gross profit | 30,891 | 22,599 | 21,132 | ||||||||
Used Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 125,125 | 107,329 | 96,910 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 86,052 | 74,132 | 66,738 | ||||||||
Gross profit | 39,073 | 33,197 | 30,172 | ||||||||
Parts Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 120,454 | 114,253 | 115,989 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 88,263 | 83,135 | 84,327 | ||||||||
Gross profit | 32,191 | 31,118 | 31,662 | ||||||||
Services Revenues [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 63,488 | 62,873 | 64,673 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 21,328 | 21,111 | 21,839 | ||||||||
Gross profit | 42,160 | 41,762 | 42,834 | ||||||||
Other [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 74,753 | 63,247 | 58,650 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 74,754 | 63,870 | 59,957 | ||||||||
Gross profit | $ (1) | $ (623) | $ (1,307) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings (Accumulated Deficit) [Member] |
Beginning balances at Dec. 31, 2015 | $ 142,588 | $ 392 | $ 220,879 | $ (60,405) | $ (18,278) |
Beginning balances, shares at Dec. 31, 2015 | 39,333,571 | ||||
Stock-based compensation | 3,037 | 3,037 | |||
Cash dividends declared on common stock ($1.10 per share in 2016, $1.10 per share in 2017 and $1.10 per share in 2018) | (39,101) | (39,101) | |||
Tax deficiency associated with stock-based awards | (372) | (372) | |||
Issuance of non-vested restricted common stock | 2 | $ 2 | |||
Issuance of non-vested restricted common stock, shares | 163,188 | ||||
Repurchases of 37,565, 37,565 and 37,805 shares of restricted common stock in 31 December 2016, 2017 and 2018 respectively | (561) | (561) | |||
Net income | 37,172 | 37,172 | |||
Ending Balance at Dec. 31, 2016 | 142,765 | $ 394 | 223,544 | (60,966) | (20,207) |
Balance, Shares at Dec. 31, 2016 | 39,496,759 | ||||
Cumulative effect adjustment for previously unrecognized excess tax benefits pursuant to the adoption of ASU 2016-09 | 881 | 881 | |||
Stock-based compensation | 3,526 | 3,526 | |||
Cash dividends declared on common stock ($1.10 per share in 2016, $1.10 per share in 2017 and $1.10 per share in 2018) | (39,255) | (39,255) | |||
Issuance of non-vested restricted common stock | 1 | $ 1 | |||
Issuance of non-vested restricted common stock, shares | 127,014 | ||||
Repurchases of 37,565, 37,565 and 37,805 shares of restricted common stock in 31 December 2016, 2017 and 2018 respectively | (783) | (783) | |||
Net income | 109,658 | 109,658 | |||
Ending Balance at Dec. 31, 2017 | $ 216,793 | $ 395 | 227,070 | (61,749) | 51,077 |
Balance, Shares at Dec. 31, 2017 | 39,623,773 | 39,623,773 | |||
Stock-based compensation | $ 4,214 | 4,214 | |||
Cash dividends declared on common stock ($1.10 per share in 2016, $1.10 per share in 2017 and $1.10 per share in 2018) | (39,368) | (39,368) | |||
Issuance of non-vested restricted common stock | (109) | $ 1 | (110) | ||
Issuance of non-vested restricted common stock, shares | 124,789 | ||||
Repurchases of 37,565, 37,565 and 37,805 shares of restricted common stock in 31 December 2016, 2017 and 2018 respectively | (1,350) | (1,350) | |||
Net income | 76,623 | 76,623 | |||
Ending Balance at Dec. 31, 2018 | $ 256,803 | $ 396 | $ 231,174 | $ (63,099) | $ 88,332 |
Balance, Shares at Dec. 31, 2018 | 39,748,562 | 39,748,562 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Dividends declared per common share outstanding | $ 1.10 | $ 1.10 | $ 1.10 |
Retained Earnings (Accumulated Deficit) [Member] | |||
Dividends declared per common share outstanding | $ 1.10 | $ 1.10 | $ 1.10 |
Treasury Stock [Member] | |||
Repurchase of restricted common stock, shares | 37,805 | 37,565 | 37,565 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net income | $ 76,623 | $ 109,658 | $ 37,172 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization of property and equipment | 24,593 | 23,790 | 27,282 |
Depreciation of rental equipment | 208,453 | 169,455 | 162,415 |
Amortization of intangible assets | 3,320 | ||
Amortization of deferred financing costs | 1,083 | 1,046 | 1,052 |
Accretion of note discount, net of premium amortization | 477 | 274 | 168 |
Provision for losses on accounts receivable | 2,741 | 3,932 | 3,137 |
Provision for inventory obsolescence | 122 | 161 | 127 |
Change in deferred income taxes | 26,695 | (50,535) | 21,578 |
Stock-based compensation expense | 4,214 | 3,526 | 3,037 |
Loss on early extinguishment of debt | 25,363 | ||
Gain from sales of property and equipment, net | (7,118) | (5,009) | (3,285) |
Gain from sales of rental equipment, net | (38,352) | (31,882) | (29,003) |
Changes in operating assets and liabilities, net of acquisitions: | |||
Receivables | (17,761) | (40,012) | 4,154 |
Inventories | (48,230) | (31,771) | 4,267 |
Prepaid expenses and other assets | (965) | (1,659) | 2,541 |
Accounts payable | 6,994 | 50,349 | (27,345) |
Manufacturer flooring plans payable | 1,664 | (8,778) | (31,653) |
Accrued expenses payable and other liabilities | 2,572 | 8,230 | 1,667 |
Deferred compensation payable | 86 | 61 | (332) |
Net cash provided by operating activities | 247,211 | 226,199 | 176,979 |
Cash flows from investing activities: | |||
Acquisition of businesses, net of cash acquired | (196,027) | ||
Purchases of property and equipment | (34,960) | (22,515) | (22,895) |
Purchases of rental equipment | (416,600) | (234,209) | (179,709) |
Proceeds from sales of property and equipment | 9,261 | 7,506 | 3,805 |
Proceeds from sales of rental equipment | 112,086 | 96,143 | 84,389 |
Net cash used in investing activities | (526,240) | (153,075) | (114,410) |
Cash flows from financing activities: | |||
Purchases of treasury stock | (1,350) | (783) | (561) |
Borrowings on senior secured credit facility | 1,436,849 | 1,193,544 | 966,146 |
Payments on senior secured credit facility | (1,266,088) | (1,356,186) | (988,361) |
Principal payments on senior unsecured notes due 2022 | (630,000) | ||
Costs paid to tender and redeem senior unsecured notes due 2022 | (23,336) | ||
Proceeds from issuance of senior unsecured notes due 2025 | 958,500 | ||
Payments of deferred financing costs | (97) | (17,278) | |
Dividends paid | (39,274) | (39,172) | (39,066) |
Payments of capital lease obligations | (212) | (218) | (203) |
Net cash provided by (used in) financing activities | 129,828 | 85,071 | (62,045) |
Net increase (decrease) in cash | (149,201) | 158,195 | 524 |
Cash, beginning of year | 165,878 | 7,683 | 7,159 |
Cash, end of year | 16,677 | 165,878 | 7,683 |
Supplemental schedule of non-cash investing and financing activities: | |||
Accrued acquisition purchase price consideration | 3,432 | ||
Non-cash asset purchases: | |||
Assets transferred from new and used inventory to rental fleet | 24,341 | 10,515 | 38,515 |
Purchases of property and equipment included in accrued expenses payable and other liabilities | (473) | (23) | (386) |
Cash paid during the year for: | |||
Interest | 62,424 | 49,546 | 52,494 |
Income taxes paid (refunds received), net | $ 2,366 | $ 478 | $ 177 |
Organization and Nature of Oper
Organization and Nature of Operations | 12 Months Ended |
Dec. 31, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Nature of Operations | (1) Organization and Nature of Operations Organization Prior to our initial public offering in February 2006, our business was conducted through H&E LLC. In connection with our initial public offering, we converted H&E LLC into H&E Equipment Services, Inc. In order to have an operating Delaware corporation as the issuer for our initial public offering, H&E Equipment Services, Inc. was formed as a Delaware corporation and wholly-owned subsidiary of H&E Holdings L.L.C. (“H&E Holdings”), and immediately prior to the closing of our initial public offering, on February 3, 2006, H&E LLC and H&E Holdings merged with and into H&E Equipment Services, Inc., which survived the reincorporation merger as the operating company. Effective February 3, 2006, H&E LLC and H&E Holdings no longer existed under operation of law pursuant to the reincorporation merger. Nature of Operations As one of the largest integrated equipment services companies in the United States focused on heavy construction and industrial equipment, we rent, sell and provide parts and services support for four core categories of specialized equipment: (1) hi-lift or aerial work platform equipment; (2) cranes; (3) earthmoving equipment; and (4) industrial lift trucks. By providing equipment rental, sales, on-site parts, repair and maintenance functions under one roof, we are a one-stop provider for our customers’ varied equipment needs. This full service approach provides us with multiple points of customer contact, enables us to maintain a high quality rental fleet, as well as an effective distribution channel for fleet disposal and provides cross‑selling opportunities among our new and used equipment sales, rental, parts sales and services operations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies Principles of Consolidation and Basis of Presentation Our consolidated financial statements include the financial position and results of operations of H&E Equipment Services, Inc. and its wholly-owned subsidiaries H&E Finance Corp., GNE Investments, Inc., Great Northern Equipment, Inc., H&E California Holding, Inc., H&E Equipment Services (California), LLC and H&E Equipment Services (Mid-Atlantic), Inc., collectively referred to herein as “we” or “us” or “our” or the “Company.” All significant intercompany accounts and transactions have been eliminated in these consolidated financial statements. Business combinations are included in the consolidated financial statements from their respective dates of acquisition. The nature of our business is such that short-term obligations are typically met by cash flows generated from long-term assets. Consequently, and consistent with industry practice, the accompanying consolidated balance sheets are presented on an unclassified basis. Use of Estimates We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, which requires management to use its judgment to make estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. These assumptions and estimates could have a material effect on our condensed consolidated financial statements. Actual results may differ materially from those estimates. We review our estimates on an ongoing basis based on information currently available, and changes in facts and circumstances may cause us to revise these estimates. Revenue Recognition In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Entities may use a full retrospective approach or report on the cumulative effect as of the date of adoption. We adopted this standard effective January 1, 2018 using the full retrospective transition method. As further discussed below, upon the adoption of Topic 606 on January 1, 2018, we recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 840 (which addresses lease accounting). As discussed below in “Pronouncements Not Yet Adopted”, Topic 842 superseded Topic 840 effective January 1, 2019. Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services. Nature of goods and services The tables below summarize our revenues as presented in our consolidated statements of income for the years ended December 31, 2018, 2017 and 2016 by revenue type and by the applicable accounting standard (amounts in thousands). Year Ended December 31, 2018 2017 Topic 840 Topic 606 Total Topic 840 Topic 606 Total Rental revenues $ 590,858 $ 1,335 $ 592,193 $ 476,978 $ 2,038 $ 479,016 New equipment sales ─ 262,948 262,948 ─ 203,301 203,301 Used equipment sales ─ 125,125 125,125 ─ 107,329 107,329 Parts sales ─ 120,454 120,454 ─ 114,253 114,253 Service revenues ─ 63,488 63,488 ─ 62,873 62,873 Other 21,693 53,060 74,753 17,791 45,456 63,247 Total revenues $ 612,551 $ 626,410 $ 1,238,961 $ 494,769 $ 535,250 $ 1,030,019 Year Ended December 31, 2016 Topic 840 Topic 606 Total Rental revenues $ 443,148 $ 2,079 $ 445,227 New equipment sales ─ 196,688 196,688 Used equipment sales ─ 96,910 96,910 Parts sales ─ 115,989 115,989 Service revenues ─ 64,673 64,673 Other 16,199 42,451 58,650 Total revenues $ 459,347 $ 518,790 $ 978,137 Revenues by reporting segment are presented in note 18 of our condensed consolidated financial statements, using the revenue captions reflected in our consolidated statements of income. We believe that the disaggregation of our revenues from contracts to customers as reflected above, coupled with further discussion below and the reporting segment in note 18, depicts how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by economic factors. Lease revenues (Topic 840) Rental Revenues: Owned equipment rentals represent revenues from renting equipment. We account for these rental contracts as operating leases. We recognize revenue from equipment rentals in the period earned, regardless of the timing of billing to customers. A rental contract includes rates for daily, weekly or monthly use, and rental revenues are earned on a daily basis as rental contracts remain outstanding. Because the rental contracts can extend across multiple reporting periods, we record unbilled rental revenues and deferred rental revenues at the end of reporting periods so rental revenues earned is appropriately stated for the periods presented. Other: Other rental revenues primarily represent services performed by us in connection with the rental of equipment to a customer, such as fuel consumption charges, environmental fees and damage waiver insurance. Fuel consumption charges are recognized upon return of the rental equipment when fuel consumption by the customer, if any, can be measured. Income from environmental fees and damage waiver insurance policies are recognized when earned over the period the equipment is rented. See discussion below in “Pending Accounting Pronouncements Not Yet Adopted” for the expected impact of adopting Topic 842, which became effective for us on January 1, 2019. Revenues from contracts with customers (Topic 606) The accounting for the types of revenues accounted for pursuant to Topic 606 are discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time. Rental revenues: An insignificant portion of our total equipment rental revenues are recognized pursuant to Topic 606 rather than pursuant to Topic 840. These revenues represent services performed by us in connection with the rental of equipment and are comprised of customer training fees on rented equipment and erection and dismantling services on rental equipment. Revenues for these services are recognized upon completion of such services. See discussion above regarding rental revenues recognized pursuant to Topic 840. New equipment sales: Revenues from the sales of new equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Used equipment sales: Revenues from the sales of used equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Parts sales: Revenues from the sales of equipment parts are recognized at the time of pick-up by the customer for parts counter sales transactions. For parts that are shipped to a customer, we elected to use a practical expedient of Topic 606 and treat such shipping activities as fulfillment costs, thereby recognizing revenues at the time of shipment. Services revenues: We derive our services primarily from maintenance and repair services to customers for their owned equipment. We recognize services revenues at the time such services are completed, which is when the customer obtains control of the promised service. Other revenues : Other revenues relate primarily to hauling fees for transporting rental equipment and equipment sold to and from the customer and ancillary charges associated with equipment maintenance and repair services. Such revenues are recognized at the time the services are performed. Receivables and contract assets and liabilities We manage credit risk associated with our accounts receivables at the customer level. Because the same customers typically generate the revenues that are accounted for under both Topic 606 and Topic 840, the discussions below on credit risk and our allowances for doubtful accounts address our total revenues from Topic 606 and Topic 840. We believe concentration of credit risk with respect to our receivables is limited because our customer base is comprised of a large number of geographically diverse customers. Our largest customer accounted for approximately 1.2% of total revenues for the year ended December 31, 2018 and for less than one percent of total revenues for the years ended December 31, 2017 and 2016. No single customer accounted for more than 10% of our revenues on an overall or segment basis for any of the periods presented in this Annual Report on Form 10-K. We manage credit risk through credit approvals, credit limits and other monitoring procedures. We maintain an allowance for doubtful accounts that reflects our estimate of the amount of our receivables that we will be unable to collect. We develop our estimate of this allowance based on our historical experience with specific customers, our understanding of our current economic circumstances and our own judgment as to the likelihood of ultimate payment. Our largest exposure to doubtful accounts is in our rental operations. We perform credit evaluations of customers and establish credit limits based on reviews of our customers’ current credit information and payment histories. We believe our credit risk is somewhat mitigated by our geographically diverse customer base and our credit evaluation procedures. During the year, we write-off customer account balances when we have exhausted reasonable collection efforts and determined that the likelihood of collection is remote. Such write-offs are charged against our allowance for doubtful accounts. Bad debt expense as a percentage of total revenues for the years ended December 31, 2018, 2017 and 2016 were approximately 0.2%, 0.4% and 0.3%, respectively. The actual rate of future credit losses, however, may not be similar to past experience. Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance for doubtful accounts. We do not have material contract assets, impairment losses associated therewith, or material contract liabilities associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenues during the years ended December 31, 2018, 2017 or 2016 that was included in the contract liability balance as of the beginning of such periods. Performance obligations Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amount of such revenue recognized during the years ended December 31, 2018, 2017 and 2016 was not material. We also do not expect to recognize material revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2018. Payment terms Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk. Sales tax amounts collected from customers are recorded on a net basis. Contract costs We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. Contract estimates and judgments Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments as the transaction price is generally fixed and stated on our contracts. Our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation. Also, our revenues do not include material amounts of variable consideration. Substantially all of our revenues are recognized at a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenues are generally recognized at the time of delivery to, or pick-up by, the customer. Inventories We measure inventory at the lower of cost or net realizable value; where net realizable value is considered to be estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation. For new and used equipment inventories, cost is determined by specific-identification. For inventories of parts and supplies, cost is determined by using average cost. Long-lived Assets and Goodwill Rental Equipment The rental equipment we purchase is stated at cost and is depreciated over the estimated useful life of the equipment using the straight-line method. Estimated useful lives vary based upon type of equipment. Generally, we depreciate cranes and aerial work platforms over a ten year estimated useful life, earthmoving equipment over a five year estimated useful life with a 25% salvage value, and industrial lift trucks over a seven year estimated useful life. Attachments and other smaller type equipment are depreciated generally over a three year estimated useful life. We periodically evaluate the appropriateness of remaining depreciable lives and any salvage value assigned to rental equipment. Ordinary repair and maintenance costs and property taxes are charged to operations as incurred. However, expenditures for additions or improvements that significantly extend the useful life of the asset are capitalized in the period incurred. When rental equipment is sold or disposed of, the related cost and accumulated depreciation are removed from the respective accounts and any gains or losses are included in income. We receive individual offers for fleet on a continual basis, at which time we perform an analysis on whether or not to accept the offer. The rental equipment is not transferred to inventory under the held for sale model as the equipment is used to generate revenues until the equipment is sold. Property and Equipment Property and equipment are recorded at cost and are depreciated over the assets’ estimated useful lives using the straight-line method. Ordinary repair and maintenance costs are charged to operations as incurred. However, expenditures for additions or improvements that significantly extend the useful life of the asset are capitalized in the period incurred. At the time assets are sold or disposed of, the cost and accumulated depreciation are removed from their respective accounts and the related gains or losses are reflected in income. We capitalize interest on qualified construction projects. Costs associated with internally developed software are accounted for in accordance with FASB Accounting Standards Codification (“ASC”) 350-40, Internal-Use Software We periodically evaluate the appropriateness of remaining depreciable lives assigned to property and equipment. Leasehold improvements are amortized using the straight-line method over their estimated useful lives or the remaining term of the lease, whichever is shorter. Generally, we assign the following estimated useful lives to these categories: Category Estimated Useful Life Transportation equipment 5 years Buildings 39 years Office equipment 5 years Computer equipment 3 years Machinery and equipment 7 years In accordance with ASC 360, Property, Plant and Equipment Goodwill We have made acquisitions in the past that included the recognition of goodwill, which was determined based upon previous accounting principles. Pursuant to ASC 350, Intangibles-Goodwill and Other We evaluate goodwill for impairment at least annually, or more frequently if triggering events occur or other impairment indicators arise which might impair recoverability. Impairment of goodwill is evaluated at the reporting unit level. A reporting unit is defined as an operating segment (i.e. before aggregation or combination), or one level below an operating segment (i.e. a component). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. We have identified two components within our Rental operating segment and have determined that each of our other operating segments (New, Used, Parts and Service) represent a reporting unit, resulting in six total reporting units. ASC 350 allows entities to first use a qualitative approach to test goodwill for impairment. ASC 350 permits an entity to first perform a qualitative assessment to determine whether it is more likely than not (a likelihood of greater than 50%) that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, the currently prescribed two-step goodwill test must be performed. Otherwise, the two-step goodwill impairment test is not required. Considerable judgment is required by management in using the qualitative approach under ASC 350 to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. We performed a qualitative assessment as of October 1, 2018 and 2017, and there was no goodwill impairment. ASC 350 suggests that a qualitative assessment may become less relevant over time. In other words, the longer it has been since the last quantitative assessment, the more difficult it could be for a company to conclude that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. Our last quantitative assessment of goodwill impairment was as of October 1, 2016. Step 1 of that test determined that the fair values of the goodwill reporting units exceeded their respective carrying values and, therefore, Step 2 of the goodwill test was not required, as there was no goodwill impairment at October 1, 2016. The changes in the carrying amount of goodwill for our reporting units for the years ended December 31, 2018 and 2017 were as follows (amounts in thousands): Eq. Rental Comp. 1 Eq. Rental Comp. 2 New Eq. Sales Used Eq. Sales Parts Sales Services Revenues Total Balance at December 31, 2016 $ ─ $ 18,700 $ ─ $ 6,137 $ 6,360 $ ─ $ 31,197 Increases (Decreases) ─ ─ ─ ─ ─ ─ ─ Balance at December 31, 2017 ─ 18,700 ─ 6,137 6,360 ─ 31,197 Increases (1) 34,297 23,836 10,434 2,324 2,550 1,205 74,646 Decreases ─ ─ ─ ─ ─ ─ ─ Balance at December 31, 2018 $ 34,297 $ 42,536 $ 10,434 $ 8,461 $ 8,910 $ 1,205 $105,843 (1) Increases are related to goodwill recognized in the CEC and Rental Inc. 2018 acquisitions. See footnote 3 for further information. Closed Branch Facility Charges We continuously monitor and identify branch facilities with revenues and operating margins that consistently fall below Company performance standards. Once identified, we continue to monitor these branches to determine if operating performance can be improved or if the performance is attributable to economic factors unique to the particular market with unfavorable long-term prospects. If necessary, branches with unfavorable long-term prospects are closed and the rental fleet and new and used equipment inventories are deployed to more profitable branches within our geographic footprint where demand is higher. We closed one branch during each of the years ended December 31, 2018 and 2017 in markets where long-term prospects did not support continued operations. No branches were closed during 2016. Under ASC 420, Exit or Disposal Cost Obligations Deferred Financing Costs and Initial Purchasers’ Discounts Deferred financing costs include legal, accounting and other direct costs incurred in connection with the issuance and amendments thereto, of the Company’s debt. These costs are amortized over the terms of the related debt using the straight-line method which approximates amortization using the effective interest method. Initial purchasers’ discount and bond premium is the differential between the price paid to an issuer for the new issue and the prices (below and above, respectively) at which the securities are initially offered to the investing public. The amortization expense of deferred financing costs and bond premium and accretion of initial purchasers’ discounts are included in interest expense as an overall cost of the related financings. Such costs are presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. Reserves for Claims We are exposed to various claims relating to our business, including those for which we provide self-insurance. Claims for which we self-insure include: (1) workers compensation claims; (2) general liability claims by third parties for injury or property damage caused by our equipment or personnel; (3) automobile liability claims; and (4) employee health insurance claims. These types of claims may take a substantial amount of time to resolve and, accordingly, the ultimate liability associated with a particular claim, including claims incurred but not reported as of a period-end reporting date, may not be known for an extended period of time. Our methodology for developing self-insurance reserves is based on management estimates and independent third party actuarial estimates. Our estimation process considers, among other matters, the cost of known claims over time, cost inflation and incurred but not reported claims. These estimates may change based on, among other things, changes in our claim history or receipt of additional information relevant to assessing the claims. Further, these estimates may prove to be inaccurate due to factors such as adverse judicial determinations or other claim settlements at higher than estimated amounts. Accordingly, we may be required to increase or decrease our reserve levels. At December 31, 2018, our claims reserves related to workers compensation, general liability and automobile liability, which are included in “Accrued expenses and other liabilities” in our consolidated balance sheets, totaled $4.8 million and our health insurance reserves totaled $1.3 million. At December 31, 2017, our claims reserves related to workers compensation, general liability and automobile liability totaled $4.6 million and our health insurance reserves totaled $1.2 million. Advertising Advertising costs are expensed as incurred and totaled $0.5 million, $0.5 million and $1.0 million for the years ended December 31, 2018, 2017 and 2016, respectively. Income Taxes The Company files a consolidated federal income tax return with its wholly-owned subsidiaries. The Company is a C-Corporation under the provisions of the Internal Revenue Code. We utilize the asset and liability approach to measure deferred tax assets and liabilities based on temporary differences existing at each balance sheet date using currently enacted tax rates in accordance with ASC 740. ASC 740 takes into account the differences between financial statement treatment and tax treatment of certain transactions. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rate is recognized as income or expense in the period that includes the enactment date of that rate. On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into law. Included in the Act is a reduction in the corporate statutory tax rate from 35% to 21%, effective for us on January 1, 2018. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period in which the new legislation is enacted. In the case of US federal income taxes, the enactment date is the date the bill becomes law (i.e., upon presidential signature), and we recognized the impact of the Act in our consolidated financial statements for the year ended December 31, 2017. We have completed our accounting for all the tax effects of the enactment of the Act. In accordance with ASC 740, the Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax provisions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company recognizes both interest and penalties related to uncertain tax positions in net other income (expense). Our deferred tax calculation requires management to make certain estimates about future operations. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Fair Value of Financial Instruments Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The FASB fair value measurement guidance established a fair value hierarchy that prioritizes the inputs used to measure fair value. The three broad levels of the fair value hierarchy are as follows: Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 – Quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly Level 3 – Unobservable inputs for which little or no market data exists, therefore requiring a company to develop its own assumptions The carrying value of financial instruments reported in the accompanying consolidated balance sheets for cash, accounts receivable, accounts payable and accrued expenses payable and other liabilities approximate fair value due to the immediate or short-term nature or maturity of these financial instruments. The fair value of our letter of credit is based on fees currently charged for similar agreements. The carrying amounts and fair values of our other financial instruments subject to fair value disclosures as of December 31, 2018 and 2017 are presented in the table below (amounts in thousands) and have been calculated based upon market quotes and present value calculations based on market rates. December 31, 2018 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) $ 23,666 $ 19,870 Senior unsecured notes due 2025 with interest computed at 5.625% (Level 2) 944,780 871,625 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 726 330 Letter of credit (Level 3) — 116 December 31, 2017 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 4.50% (Level 3) $ 22,002 $ 18,737 Senior unsecured notes due 2025 with interest computed at 5.625% (Level 3) 944,088 619,019 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 1,486 1,114 Letter of credit (Level 3) — 116 At December 31, 2018, the fair value of our senior unsecured notes due 2025 was based on quoted bond trading market prices for those notes. At December 31, 2017, the fair value of our senior unsecured notes due 2025 was based on our incremental borrowing rate as these notes were not available (registered) on a bond trading market as of December 31, 2017. Concentrations of Credit and Supplier Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade accounts receivable. Credit risk can be negatively impacted by adverse changes in the economy or by disruptions in the credit markets. However, we believe that credit risk with respect to trade accounts receivable is somewhat mitigated by our large number of geographically diverse customers and our credit evaluation procedures. Although generally no collateral is required, when feasible, mechanics’ liens are filed and personal guarantees are signed to protect the Company’s interests. We maintain reserves for potential losses. We record trade accounts receivables at sales value and establish specific reserves for certain customer accounts identified as known collection problems due to insolvency, disputes or other collection issues. The amounts of the specific reserves estimated by management are based on the following assumptions and variables: the customer’s financial position, age of the customer’s receivables and changes in payment schedules. In addition to the specific reserves, management establishes a non-specific allowance for doubtful accounts by applying specific percentages to the different receivable aging categories (excluding the specifically reserved accounts). The percentage applied against the aging categories increases as the accounts become further past due. The allowance for doubtful accounts is charged with the write-off of uncollectible customer accounts. We purchase a significant amount of equipment from the same manufacturers with whom we have distribution agreements. During the year ended December 31, 2018, we purchased approximately 54% from five manufacturers (Grove/Manitowoc, Genie Industries (Terex), JCB, Komatsu, and Skyjack) providing our rental and sales equipment. We believe that while there are alternative sources of supply for the equipment we purchase in each of the principal product categories, termination of one or more of our relationships with any of our major suppliers of equipment could have a material adverse effect on our business, financial condition or results of operation if we were unable to obtain adequate or timely rental and sales equipment. Income per Share Income per common share for the years ended December 31, 2018, 2017 and 2016 is based on the weighted average number of common shares outstanding during the period. The effects of potentially dilutive securities that are anti-dilutive are not included in the computation of diluted income per share. We include all common shares granted under our incentive compensation plan which remain unvested (“restricted common shares”) and contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid (“participating securities”), in the number of shares outstanding in our basic and diluted EPS calculations using the two-class method. All of our restricted common shares are currently participating securities. Under the two-class method, earnings per common share are computed by dividing the sum of distributed earnings allocated to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, distributed and undistrib |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | (3) Acquisitions 2018 Acquisitions Contractors Equipment Center (“CEC”) Effective January 1, 2018, we completed the acquisition of CEC, a non-residential construction focused equipment rental company with three branches located in the greater Denver, Colorado area. The acquisition significantly expands our presence in the Denver area and surrounding markets. The aggregate consideration paid to the pre-acquisition owners of CEC was approximately $132.4 million. The acquisition and related fees and expenses were funded through available cash. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date. We do not expect any further changes to these assigned values. $’s in thousands Cash $ 1,244 Accounts receivable 7,583 Inventory 504 Prepaid expenses and other assets 324 Rental equipment 55,342 Property and equipment 2,700 Intangible assets (1) 21,500 Total identifiable assets acquired 89,197 Accounts payable (1,023) Accrued expenses payable and other liabilities (876) Total liabilities assumed (1,899) Net identifiable assets acquired 87,298 Goodwill (2) 45,092 Net assets acquired $ 132,390 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 21,000 10 Tradenames 300 1 Leasehold interests 200 10 $ 21,500 (2) We have allocated the $45.1 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $25,233 Rental Component 2 18,391 New Equipment 217 Used Equipment 632 Parts 379 Service 240 The level of goodwill that resulted from the CEC acquisition is primarily reflective of CEC’s going-concern value, the value of CEC’s assembled workforce, new customer relationships expected to arise from the acquisition and expected synergies from combining operations. We currently expect the goodwill recognized to be 100% deductible for income tax purposes. Total CEC acquisition costs were $1.0 million, of which approximately $0.2 million was incurred in the year ended December 31, 2018. Total revenues attributable to CEC since the acquisition were $39.3 million for the year ended December 31, 2018. Estimated net income attributable to CEC since the acquisition was $5.1 million for the year ended December 31, 2018. It should be noted that since our acquisition of CEC, significant amounts of equipment rental fleet have been moved between H&E locations and the acquired CEC locations, the impact of which is included in these CEC operating results above, as it is impractical to report CEC operating results on a pure stand-alone basis post-acquisition. Rental, LLC (dba “Rental Inc.”) Effective April 1, 2018, we completed the acquisition of Rental Inc., a non-residential equipment rental and distribution company with five branches located in Alabama, Florida and Western Georgia. The acquisition expands our presence in the surrounding market. The aggregate consideration paid to the owners of Rental Inc. was approximately $68.6 million. The acquisition and related fees and expenses were funded through available cash and from borrowings under our Credit Facility (as defined below). The following table summarizes the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date. The amounts presented here are preliminary and are subject to change. However, we do not expect material changes to these assigned values. $’s in thousands Cash $ 260 Accounts receivable 2,873 Inventory 5,324 Prepaid expenses and other assets 47 Rental equipment 22,578 Property and equipment 1,935 Intangible assets (1) 10,200 Total identifiable assets acquired 43,217 Accounts payable (439) Manufacturer flooring plans payable (3,293) Accrued expenses payable and other liabilities (469) Total liabilities assumed (4,201) Net identifiable assets acquired 39,016 Goodwill (2) 29,554 Net assets acquired $ 68,570 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 10,000 10 Tradenames 200 1 $ 10,200 (2) We have allocated the $29.6 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $9,064 Rental Component 2 5,445 New Equipment 10,217 Used Equipment 1,692 Parts 2,171 Service 964 Included in the total goodwill amount of $29.6 million is approximately $3.4 million of accrued purchase price consideration to be paid to the sellers pursuant to the terms of the purchase agreement among the parties named thereto. The level of goodwill that resulted from the Rental Inc. acquisition is primarily reflective of Rental Inc.’s going-concern value, the value of Rental Inc.’s assembled workforce, new customer relationships expected to arise from the acquisition and expected synergies from combining operations. We currently expect the goodwill recognized to be 100% deductible for income tax purposes. Total Rental Inc. acquisition costs were $0.3 million, substantially all of which was incurred in year ended December 31, 2018. Total revenues attributable to Rental Inc. since the April 1, 2018 acquisition were $25.3 million for the year ended December 31, 2018. Estimated net income attributable to Rental Inc. since the April 1, 2018 acquisition was $0.3 million, or $0.01 per share, for the year ended December 31, 2018. It should be noted that since our acquisition of Rental Inc., significant amounts of rental fleet have been moved between H&E locations and the acquired Rental Inc. locations, the impact of which is included in these Rental Inc. operating results above, as it is impractical to report Rental Inc. operating results on a pure stand-alone basis post-acquisition. We-Rent-It (“WRI”) Effective February 1, 2019, we completed the acquisition of WRI, an equipment rental company with six branches located in central Texas. The acquisition expands our presence in the surrounding market. The aggregate consideration paid to the owners of WRI was approximately $108.5 million. The acquisition and related fees and expenses were funded from borrowings under our Credit Facility (defined below). As of February 21, 2019, a preliminary allocation of the fair value of the existing purchase price of WRI had yet to be completed. Accordingly, disclosure of the allocation of the purchase price to the WRI balance line items and the pro forma presentation reflecting the impact of the acquisition will be disclosed in subsequent filings. Pro forma financial information We completed the CEC acquisition effective January 1, 2018. Therefore, the operating results of CEC are included in our reported condensed consolidated statements of income for the full year ended December 31, 2018. We completed the Rental Inc. acquisition effective April 1, 2018. Therefore, our reported consolidated statements of income for the year ended December 31, 2018 do not include Rental Inc. for the period from January 1, 2018 through March 31, 2018. The pro forma information below gives effect to the CEC and Rental Inc. acquisitions as if they had been completed on January 1, 2017 (the “pro forma acquisition date”). The pro forma information is not necessarily indicative of our results of operations had the acquisitions been completed on the above date, nor is it necessarily indicative of our future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisitions, nor does it reflect additional revenue opportunities following the acquisition. The pro forma adjustments reflected in the table below are subject to change as additional analysis is performed. The unaudited tables below present unaudited pro forma consolidated statements of income information for the year December 31, 2017 as if CEC and Rental Inc. were included in our consolidated results for the entire period presented. (amounts in thousands, except per share data) Year Ended December 31, 2017 H&E CEC Rental Inc. Total Total revenues $1,030,019 $36,790 $34,942 $1,101,751 Pretax income 59,344 3,043 7,267 69,654 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (1) — (3,575) (2,794) (6,369) Intangible asset amortization (2) — (2,420) (1,200) (3,620) Elimination of merger related costs 788 4,465 — 5,285 Interest expense (3) — — (1,609) (1,609) Elimination of historic interest expense (4) — 1,966 382 2,348 Pro forma pretax income 60,132 3,479 2,046 65,689 Pro forma income tax benefit (50,511) (2,922) (1,719) (55,179) Pro forma net income $ 110,643 $6,401 $3,765 $120,868 Pro forma net income per share – basic $ 3.12 $ 0.18 $ 0.11 $ 3.40 Pro forma net income per share - diluted $ 3.10 $ 0.18 $ 0.11 $ 3.39 (amounts in thousands, except per share data) Year Ended December 31, 2018 H&E(5) Rental Inc.(6) Total Total revenues $1,238,961 $7,408 $1,246,369 Pretax income 104,663 1,020 105,683 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (1) ─ (749) (749) Intangible asset amortization (2) ─ (300) (300) Interest expense (3) ─ (480) (480) Elimination of historic interest expense (4) ─ 82 82 Pro forma pretax income (loss) 104,663 (427) 104,236 Pro forma income tax expense (benefit) 28,040 (114) 27,926 Pro forma net income (loss) $ 76,623 $ (313) $ 76,310 Pro forma net income (loss) per share – basic $ 2.15 $(0.01) $ 2.14 Pro forma net income (loss) per share - diluted $ 2.13 $(0.01) $ 2.13 (1) Depreciation of rental equipment and non-rental equipment were adjusted for the fair value markups, and the changes in useful lives and salvage values of the equipment acquired in the acquisitions. (2) Represents the amortization of the intangible assets acquired in the acquisitions. (3) A portion of the consideration paid for Rental Inc. was funded with borrowings from our Credit Facility. Interest expense was adjusted to reflect the additional debt resulting from such acquisition. (4) Represents the elimination of historic debt of CEC and Rental Inc. that is not part of the combined entity. (5) H&E represents consolidated operating results as presented in this Annual Report on Form 10-K for the year ended December 31, 2018 and includes actual results for CEC for the full twelve months ended December 31, 2018 and actual results for Rental Inc. for the period April 1, 2018 through December 31, 2018. (6) Represents Rental Inc. pro forma operating results for the three month period ended March 31, 2018. We completed the Rental Inc. acquisition effective April 1, 2018. |
Receivables
Receivables | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Receivables | (4) Receivables Receivables consisted of the following at December 31, (amounts in thousands): 2018 2017 Trade receivables $ 194,601 $ 172,522 Unbilled rental revenue 8,833 6,291 Income tax receivables 2,181 997 Other 35 45 205,650 179,855 Less allowance for doubtful accounts (4,094 ) (3,774 ) Total receivables, net $ 201,556 $ 176,081 We charge off customer account balances when we have exhausted reasonable collection efforts and determined that the likelihood of collection is remote. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventories | (5) Inventories Inventories consisted of the following at December 31, (amounts in thousands): 2018 2017 New equipment $ 84,603 $ 55,704 Used equipment 1,980 2,421 Parts, supplies and other 18,015 16,879 Total inventories, net $ 104,598 $ 75,004 The above amounts are presented net of reserves for inventory obsolescence at December 31, 2018 and 2017 totaling approximately $0.4 million and $0.9 million, respectively. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | (6) Property and Equipment Net property and equipment consisted of the following at December 31, (amounts in thousands): 2018 2017 Land $ 7,597 $ 7,165 Transportation equipment 106,011 93,550 Building and leasehold improvements 63,060 55,523 Office and computer equipment 51,758 53,256 Machinery and equipment 17,811 15,983 Property under capital leases 2,417 3,217 Construction in progress 9,129 4,595 257,783 233,289 Less accumulated depreciation and amortization (142,662 ) (131,500 ) Total net property and equipment $ 115,121 $ 101,789 Total depreciation and amortization on property and equipment was $24.6 million, $23.8 million and $27.3 million for the years ended December 31, 2018, 2017 and 2016, respectively. |
Manufacturer Flooring Plans Pay
Manufacturer Flooring Plans Payable | 12 Months Ended |
Dec. 31, 2018 | |
Text Block [Abstract] | |
Manufacturer Flooring Plans Payable | (7) Manufacturer Flooring Plans Payable Manufacturer flooring plans payable are financing arrangements for inventory and rental equipment. The interest cost incurred on the manufacturer flooring plans ranged from 0% to the prime rate (5.50% at December 31, 2018) plus an applicable margin at December 31, 2018. Certain manufacturer flooring plans provide for a one to twelve-month reduced interest rate term or a deferred payment period. We recognize interest expense based on the effective interest method. We make payments in accordance with the original terms of the financing agreements. However, we routinely sell equipment that is financed under manufacturer flooring plans prior to the original maturity date of the financing agreement. The related manufacturer flooring plan payable is then paid at the time the equipment being financed is sold. The manufacturer flooring plans payable are secured by the equipment being financed. Maturities (based on original financing terms) of the manufacturer flooring plans payable as of December 31, 2018 for each of the next three years ending December 31 are as follows (amounts in thousands): 2019 $ 12,605 2020 10,822 2021 239 Thereafter — Total $ 23,666 |
Accrued Expenses Payable and Ot
Accrued Expenses Payable and Other Liabilities | 12 Months Ended |
Dec. 31, 2018 | |
Payables And Accruals [Abstract] | |
Accrued Expenses Payable and Other Liabilities | (8) Accrued Expenses Payable and Other Liabilities Accrued expenses payable and other liabilities consisted of the following at December 31, (amounts in thousands): 2018 2017 Payroll and related liabilities $ 24,864 $ 20,429 Sales, use and property taxes 10,069 9,635 Accrued interest 18,771 19,134 Accrued insurance 4,328 4,211 Deferred revenue 5,973 6,631 Other 9,366 5,055 Total accrued expenses payable and other liabilities $ 73,371 $ 65,095 |
Senior Unsecured Notes
Senior Unsecured Notes | 12 Months Ended |
Dec. 31, 2018 | |
Senior Unsecured Notes [Member] | |
Debt Instrument [Line Items] | |
Senior Secured Credit Facility | (9) Senior Unsecured Notes On August 24, 2017, we completed an offering of $750 million aggregate principal amount of 5.6250% senior notes due 2025 (the “New Notes”) and the settlement of a cash tender offer (the “Tender Offer”) with respect to our 7% senior notes due 2022 (the “Old Notes”). Net proceeds, after deducting $10.3 million of estimated offering expenses, from the sale of the New Notes totaled approximately $739.7 million. We used a portion of the net proceeds from the sale of the New Notes to repurchase $329.7 million of aggregate principal amount of the Old Notes in early settlement of the Tender Offer, which the Company launched on August 17, 2017. Holders who tendered their Old Notes prior to the early tender deadline received $1,038.90 per $1,000 principal amount of Old Notes tendered, plus accrued and unpaid interest up to, but not including, the payment date of August 24, 2017. Effective as of August 24, 2017, we (i) provided notice of the redemption of all remaining Old Notes that were not validly tendered in the Tender Offer at the expiration time and (ii) satisfied and discharged the indenture governing the Old Notes in accordance with its terms. On September 25, 2017, we redeemed the remaining $300.3 million principal amount outstanding of the Old Notes at a redemption price equal to 103.50% of the principal amount thereof, plus accrued and unpaid interest up to, but not including, the date of redemption. The New Notes were issued at par and require semiannual interest payments on March 1st and September 1st of each year, commencing on March 1, 2018. No principal payments are due until maturity (September 1, 2025). The New Notes are redeemable, in whole or in part, at any time on or after September 1, 2020 at specified redemption prices plus accrued and unpaid interest to the date of redemption. We may redeem up to 40% of the aggregate principal amount of the New Notes before September 1, 2020 with the net cash proceeds from certain equity offerings. We may also redeem the New Notes prior to September 1, 2020 at a specified “make-whole” redemption price plus accrued and unpaid interest to the date of redemption. The New Notes rank equally in right of payment to all of our existing and future senior indebtedness and rank senior to any of our subordinated indebtedness. The New Notes are unconditionally guaranteed on a senior unsecured basis by all of our current and future significant domestic restricted subsidiaries. In addition, the New Notes are effectively subordinated to all of our and the guarantors’ existing and future secured indebtedness, including the Credit Facility, to the extent of the assets securing such indebtedness, and are structurally subordinated to all of the liabilities and preferred stock of any of our subsidiaries that do not guarantee the New Notes. If we experience a change of control, we will be required to offer to purchase the New Notes at a repurchase price equal to 101% of the principal amount, plus accrued and unpaid interest to the date of repurchase. The indenture governing the New Notes contains certain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: (i) incur additional indebtedness, assume a guarantee or issue preferred stock; (ii) pay dividends or make other equity distributions or payments to or affecting our subsidiaries; (iii) purchase or redeem our capital stock; (iv) make certain investments; (v) create liens; (vi) sell or dispose of assets or engage in mergers or consolidations; (vii) engage in certain transactions with subsidiaries or affiliates; (viii) enter into sale-leaseback transactions; and (ix) engage in certain business activities. Each of the covenants is subject to exceptions and qualifications. As of December 31, 2018, we were in compliance with these covenants. On November 22, 2017, we closed on an offering of $200 million aggregate principal amount of 5.625% senior notes due 2025 (the “Add-on Notes”) in an unregistered offering through a private placement. The Add-on Notes were priced at 104.25% of the principal amount. Net proceeds from the offering of the Add-on Notes, including accrued interest from August 24, 2017 totaled approximately $209.2 million. The net proceeds of the offering, was used to repay indebtedness outstanding under the Company’s existing senior secured credit facility (the “Credit Facility”) and for the payment of fees and expenses related to the offering. The remainder of the net proceeds will be used for general corporate purposes and to fund potential acquisitions in connection with our ongoing strategy of acquiring rental companies to complement our existing business and footprint. The Add-on Notes were issued as additional notes under an indenture dated as of August 24, 2017, pursuant to which we previously issued the New Notes as described above. The Add-on Notes have identical terms to, rank equally with and form a part of a single class of securities with the New Notes. Pursuant to registration rights agreements entered into among us, the guarantors of the New Notes and the Add-On Notes, respectively, and the initial purchasers of the New Notes and the Add-On Notes, respectively, we agreed to make offers to exchange (collectively, the “Exchange Offer”) the New Notes and Add-On Notes and the respective guarantees for registered, publicly tradable notes and guarantees that have terms identical in all material respects to the New Notes and the Add-On Notes, respectively (except that the exchange notes do not contain any transfer restrictions) within a certain period of time following the completion of the respective note offerings. We completed the Exchange Offer for the New Notes and the Add-On Notes in March 2018. The following table reconciles our Senior Unsecured Notes to our Consolidated Balance Sheets (amounts in thousands): Balance at December 31, 2016 $ 627,711 Accretion of discount on Old Notes through August 24, 2017 683 Amortization of note premium on Old Notes through August 24, 2017 (574 ) Amortization of deferred financing costs on Old Notes through August 24, 2017 153 Aggregate principal amount paid on Old Notes (630,000 ) Writeoff of unaccreted discount on Old Notes 5,294 Writeoff of unamortized premium on Old Notes (4,452 ) Writeoff of deferred financing costs on Old Notes 1,185 Aggregate principal amount issued on New Notes 950,000 Notes discount and deferred transaction costs on New Notes (14,684 ) Note premium on New Notes 8,500 Accretion of discount on New Notes from August 24, 2017 through December 31, 2017 542 Amortization of note premium on New Notes from August 24, 2017 through December 31, 2017 (375 ) Amortization of deferred financing costs on New Notes from August 24, 2017 through December 31, 2017 105 Balance at December 31, 2017 $ 944,088 Accretion of discount through December 31, 2018 1,539 Amortization of note premium through December 31, 2018 (1,062 ) Additional deferred financing costs on New Notes (97 ) Amortization of deferred financing costs through December 31, 2018 312 Balance at December 31, 2018 $ 944,780 |
Senior Secured Credit Facility
Senior Secured Credit Facility | 12 Months Ended |
Dec. 31, 2018 | |
Secured Debt [Member] | |
Senior Secured Credit Facility | (10) Senior Secured Credit Facility We and our subsidiaries are parties to a $750.0 million Credit Facility with Wells Fargo Capital Finance, LLC (as successor to General Electric Capital Corporation) as administrative agent, and the lenders named therein. On December 22, 2017, we amended, extended and restated the Credit Facility by entering into the Fifth Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”) by and among the Company, Great Northern Equipment, Inc., H&E Equipment Services (California), LLC, H&E Equipment Services (Mid-Atlantic), LLC, the other credit parties named therein, the lenders named therein, Wells Fargo Capital Finance, LLC, as administrative agent, the other credit parties named therein, the lenders named therein, and the joint lead arrangers, joint book runners, co-syndication agents and documentation agent named therein. The Amended and Restated Credit Agreement, among other things, (i) extended the maturity date of the credit facility from May 21, 2019 to December 22, 2022, (ii) increased the commitments under the senior secured asset based revolver provided for therein from $602.5 million to $750 million, (iii) increased the uncommitted incremental revolving capacity from $150 million to $250 million, (iv) provided that the unused line fee margin will be either 0.375% or 0.25%, depending on the Average Revolver Usage (as defined in the Amended and Restated Credit Agreement) of the borrowers, (v) lowered the interest rate (a) in the case of base rate revolving loans, to the base rate plus an applicable margin of 0.50% to 1.00% depending on the Average Availability (as defined in the Amended and Restated Credit Agreement) and (b) in the case of LIBOR revolving loans, to LIBOR (as defined in the Amended and Restated Credit Agreement) plus an applicable margin of 1.50% to 2.00%, depending on the Average Availability, (vi) lowered the margin applicable to the letter of credit fee to between 1.50% and 2.00%, depending on the Average Availability, and (vii) permitted, subject to certain conditions, an unlimited amount of Permitted Acquisitions, Restricted Payments and prepayments of Indebtedness (in each case, as defined in the Amended and Restated Credit Agreement). On February 1, 2019, we further amended and extended the Amended and Restated Credit Agreement with the First Amendment to the Fifth Amended and Restated Credit Agreement (the “First Amendment”) by and among the Company, Great Northern Equipment, Inc., H&E Equipment Services (California), LLC, H&E Equipment Services (Mid-Atlantic), LLC, the other credit parties named therein, the lenders named therein, Wells Fargo Capital Finance, LLC, as administrative agent, the other credit parties named therein, the lenders named therein, and the joint lead arrangers, joint book runners, co-syndication agents and documentation agent named therein. The First Amendment, among other things, (i) extended the maturity date of the credit facility from December 22, 2022 to January 31, 2024, and (ii) lowered the interest rate in the case of LIBOR revolving loans, to LIBOR plus an applicable margin of 1.25% to 1.75%, depending on the Average Availability and (iii) lowered the interest rate in the case of Base Rate loans, to the Base Rate (as defined in the Amended and Restated Credit Agreement) plus an applicable margin of 0.25% to 0.75%, depending on the Average Availability . As amended, the Amended and Restated Credit Agreement continues to provide for, among other things, a $30 million letter of credit sub-facility, and a guaranty by certain of the Company’s subsidiaries of the obligations under the Credit Facility. In addition, the Credit Facility remains secured by substantially all of the assets of the Company and certain of its subsidiaries. At December 31, 2018, we had $170.8 million in borrowings outstanding under the Credit Facility and could borrow up to $571.5 million and remain in compliance with the debt covenants under the Company’s credit facility. At February 14, 2019, we had $483.3 million of available borrowings under our Credit Facility, net of a $7.7 million outstanding letter of credit. |
Capital Lease Obligations
Capital Lease Obligations | 12 Months Ended |
Dec. 31, 2018 | |
Leases [Abstract] | |
Capital Lease Obligations | (11) Capital Lease Obligations As of December 31, 2018, we had one capital lease obligation, expiring in 2022. Future minimum capital lease payments, in the aggregate, existing at December 31, 2018 for each of the next five years ending December 31 and thereafter are as follows (amounts in thousands): 2019 $ 252 2020 252 2021 252 2022 42 Total minimum lease payments 798 Less: amount representing interest (72 ) Present value of minimum lease payments $ 726 See also “Recent Accounting Pronouncements” in note 2 to these consolidated financial statements regarding the new lease accounting guidance, ASC 842, which became effective January 1, 2019. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (12) Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into law. Among other changes, the Act reduced the corporate federal income tax rate from 35% to 21%. As a result of the rate change, in 2017 we recorded a one-time decrease in income tax expense of $66.9 million from the re-measurement of our deferred tax assets and liabilities which is reflected in the tables below. Our accounting for the income tax effects of the Act is complete and there were no changes made to the enactment-date accounting during 2018. Our income tax provision (benefit) for the years ended December 31, 2018, 2017 and 2016, consists of the following (amounts in thousands): Current Deferred Total Year ended December 31, 2018: U.S. Federal $ (1,522 ) $ 23,126 $ 21,604 State 2,868 3,568 6,436 $ 1,346 $ 26,694 $ 28,040 Year ended December 31, 2017: U.S. Federal $ — $ (54,241 ) $ (54,241 ) State 220 3,707 3,927 $ 220 $ (50,534 ) $ (50,314 ) Year ended December 31, 2016 U.S. Federal $ — $ 21,516 $ 21,516 State 280 62 342 $ 280 $ 21,578 $ 21,858 Significant components of our deferred income tax assets and liabilities as of December 31 are as follows (amounts in thousands): 2018 2017 Deferred tax assets: Accounts receivable $ 1,010 $ 929 Inventories 93 239 Net operating losses 86,859 18,165 AMT and tax credits 2,110 3,565 Sec 263A costs 752 544 Accrued liabilities 2,869 2,767 Deferred compensation 1,561 1,132 Accrued interest 387 365 Stock-based compensation 146 181 Goodwill and intangible assets 346 — Other assets 415 531 96,548 28,418 Valuation allowance (609 ) (732 ) 95,939 27,686 Deferred tax liabilities: Property and equipment (245,198 ) (152,235 ) Investments (1,076 ) (1,066 ) Goodwill and intangible assets (2,778 ) (804 ) (249,052 ) (154,105 ) Net deferred tax liabilities $ (153,113 ) $ (126,419 ) The reconciliation between income taxes computed using the statutory federal income tax rate (21% for the year ended December 31, 2018 and 35% for the years ended December 31, 2017 and 2016) to the actual income tax expense (benefit) is below for the years ended December 31 (amounts in thousands): 2018 2017 2016 Computed tax at statutory rates $ 21,979 $ 20,770 $ 20,660 Permanent items - other 1,021 911 904 Permanent items - excess of tax deductible goodwill — (2,130 ) — State income tax, net of federal tax effect 5,246 2,563 2,115 Change in valuation allowance (123 ) 397 207 Change in uncertain tax positions (83 ) (5,960 ) 66 Other - change in deferred state rate — — (2,094 ) Impact of the Act federal rate change — (66,865 ) — $ 28,040 $ (50,314 ) $ 21,858 At December 31, 2018, we had available federal net operating loss carry forwards of approximately $86.2 million, which expire in varying amounts from 2030 through 2036 and $298.2 million, which does not expire. We also had federal alternative minimum tax credit carry forwards at December 31, 2018 of approximately $3.0 million which do not expire and $0.4 million general business credit carry forwards that expire in varying amounts from 2026 and 2037, and state income tax credits of $0.2 million that expire in varying amounts beginning in 2019. In accordance with changes made by the Act, our AMT credit became refundable between 2018 and 2022; therefore, we have reclassified $1.5 million from deferred income taxes to income tax receivable during the year ended December 31, 2018. The federal and state net operating loss carryforwards in the income tax returns filed included unrecognized tax benefits taken in prior years. These net operating losses for which a deferred tax asset is recognized for financial statement purposes in accordance with ASC 740 are presented net of these unrecognized tax benefits. Management has concluded that it is more likely than not that the federal deferred tax assets are fully realizable through future reversals of existing taxable temporary differences and future taxable income. Therefore, a valuation allowance is not required to reduce those deferred tax assets as of December 31, 2018. However, for the year ended December 31, 2018, we decreased our valuation allowance by $0.1 million for certain state net operating losses that were realized. A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits is as follows (in thousands): 2018 2017 Gross unrecognized tax benefits at January 1 $ 106 $ 6,119 Increases in tax positions taken in prior years — 22 Decreases in tax positions taken in prior years (106 ) (22 ) Lapse in statute of limitations — (6,013 ) Gross unrecognized tax benefits at December 31 $ — $ 106 As of December 31, 2018, we have no reserves established for the gross amount of unrecognized tax benefits. The statute of limitations lapsed during 2017 for approximately $6.0 million of unrecognized tax benefits. We recognized a reduction of $5.9 million in income tax expense in 2017 as a result. Consistent with our historical financial reporting, to the extent we incur interest income, interest expense, or penalties related to unrecognized income tax benefits, they are recorded in “Other net income or expense.” The amount of interest and penalties included in the table above are not material. We do not expect a material change in unrecognized tax benefits related to federal and state exposures will occur within the next twelve months. Our U.S. federal tax returns for 2015 and subsequent years remain subject to examination by tax authorities. We are also subject to examination in various state jurisdictions for 2013 and subsequent years. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (13) Commitments and Contingencies Operating Leases As of December 31, 2018, we lease certain real estate related to our branch facilities as well as certain office equipment under non-cancelable operating lease agreements expiring at various dates through 2033. Our real estate leases provide for varying terms, including customary renewal options and base rental escalation clauses, for which the related rent expense is accounted for on a straight-line basis during the terms of the respective leases. Additionally, certain real estate leases may require us to pay maintenance, insurance, taxes and other expenses in addition to the stated rental payments. Rent expense on property leases and equipment leases under non-cancelable operating lease agreements for the years ended December 31, 2018, 2017 and 2016 amounted to approximately $23.1 million, $20.1 million and $18.7 million, respectively. Future minimum operating lease payments existing at December 31, 2018 for each of the next five years ending December 31 and thereafter are as follows (amounts in thousands): 2019 $ 21,775 2020 21,965 2021 21,176 2022 19,854 2023 17,145 Thereafter 86,398 $ 188,313 See also “Recent Accounting Pronouncements” in note 2 regarding the new lease accounting guidance, ASC 842, which became effective on January 1, 2019. Legal Matters We are also involved in various claims and legal actions arising in the ordinary course of business. In the opinion of management, after consultation with legal counsel, the ultimate disposition of these various matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations or liquidity. Letters of Credit The Company had outstanding letters of credit issued under its Credit Facility totaling $7.7 million as of December 31, 2018 and 2017, respectively. The letters of credit expire in May 2019 and are expected to be renewed for similar one-year terms. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2018 | |
Compensation And Retirement Disclosure [Abstract] | |
Employee Benefit Plan | (14) Employee Benefit Plan We offer substantially all of our employees’ participation in a qualified 401(k)/profit-sharing plan in which we match employee contributions up to predetermined limits for qualified employees as defined by the plan. For the years ended December 31, 2018, 2017 and 2016, we contributed to the plan, net of employee forfeitures, $2.5 million, $2.2 million and $2.0 million, respectively. |
Deferred Compensation Plans
Deferred Compensation Plans | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Deferred Compensation Plans | (15) Deferred Compensation Plans In 2001, we assumed, in a business combination, nonqualified employee deferred compensation plans under which certain employees had previously elected to defer a portion of their annual compensation. Upon assumption of the plans, the plans were amended to not allow further participant compensation deferrals. Compensation previously deferred under the plans is payable upon the termination, disability or death of the participants. At December 31, 2018, we have obligations remaining under one deferred compensation plan. All other plans have terminated pursuant to the provisions of each respective plan. The remaining plan accumulates interest each year at a bank’s prime rate in effect at the beginning of January of each year. This rate remains constant throughout the year. The effective rate for the 2018 calendar plan year was 4.50%. The aggregate deferred compensation payable at December 31, 2018 and December 31, 2017 was approximately $2.0 million and $1.9 million, respectively. Included in these amounts at December 31, 2018 and 2017 was accrued interest of $1.5 million and $1.4 million, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | (16) Related Party Transactions Mr. John M. Engquist, who served as the Company’s Chief Executive Officer for the periods presented in these consolidated financial statements, has a 30.0% ownership interest in Perkins-McKenzie Insurance Agency, Inc. (“Perkins-McKenzie”), an insurance brokerage firm. Mr. Engquist’s mother’s estate and sister have a 12.0% and 6.0% interest, respectively, in Perkins-McKenzie. Perkins-McKenzie brokers a substantial portion of our commercial liability insurance. As the broker, Perkins-McKenzie receives from our insurance provider as a commission a portion of the premiums we pay to the insurance provider. Commissions paid to Perkins-McKenzie on our behalf as insurance broker totaled approximately $0.8 million, $0.8 million and $0.9 million for the years ended December 31, 2018, 2017 and 2016, respectively. We purchase products and services from, and sell products and services to, B-C Equipment Sales, Inc., in which Mr. Engquist has a 50% ownership interest. In each of the years ended December 31, 2018, 2017 and 2016, our purchases totaled $0.1 million, $0.4 million and $0.4 million, respectively, and our sales to B-C Equipment Sales, Inc. totaled approximately $0.1 million, $0.1 million and $0.1 million, respectively. |
Summarized Quarterly Financial
Summarized Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Quarterly Financial Data (Unaudited) | (17) Summarized Quarterly Financial Data (Unaudited) The following is a summary of our unaudited quarterly financial results of operations for the years ended December 31, 2018 and 2017 (amounts in thousands, except per share amounts): First Quarter Second Quarter Third Quarter Fourth Quarter 2018: Total revenues $ 260,482 $ 310,364 $ 322,141 $ 345,974 Income from operations 27,326 43,103 45,318 50,899 Income before provision for income taxes 13,068 27,869 28,971 34,755 Net income 9,478 20,771 21,314 25,060 Basic net income per common share (1) 0.27 0.58 0.60 0.70 Diluted net income per common share (1) 0.26 0.58 0.59 0.70 First Quarter Second Quarter Third Quarter Fourth Quarter 2017: Total revenues $ 226,828 $ 249,363 $ 259,162 $ 294,666 Income from operations (2) 21,325 28,668 47,654 40,268 Income before provision for income taxes (3) 8,530 15,668 7,577 27,569 Net income (4) 5,390 9,878 8,462 85,928 Basic net income per common share (1) 0.15 0.28 0.24 2.41 Diluted net income per common share (1) 0.15 0.28 0.24 2.40 (1) Because of the method used in calculating per share data, the summation of quarterly per share data may not necessarily total to the per share data computed for the entire year due to rounding. (2) (3) In addition to the amounts described in (2) above, the third quarter of 2017 includes a $25.4 million loss on the early extinguishment of debt. (4) During the third quarter of 2017, the statute of limitations lapsed for approximately $6.0 million of unrecognized tax benefits, for which we recognized a $5.9 million reduction in income tax expense for the third quarter of 2017. During the fourth quarter of 2017 and as further described in note 12 above, we recorded a one-time decrease in income tax expense of approximately $66.9 million related to the impact from the enactment of the Act legislation. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | (18) Segment Information We have identified five reportable segments: equipment rentals, new equipment sales, used equipment sales, parts sales and service revenues. These segments are based upon how management of the Company allocates resources and assesses performance. Non-segmented revenues and non-segmented costs relate to equipment support activities including transportation, hauling, parts freight and damage-waiver charges and are not allocated to the other reportable segments. There were no sales between segments for any of the periods presented. Selling, general, and administrative expenses as well as all other income and expense items below gross profit are not generally allocated to our reportable segments. We do not compile discrete financial information by our segments other than the information presented below. The following table presents information about our reportable segments (amounts in thousands): Years Ended December 31, 2018 2017 2016 Segment Revenues: Equipment rentals $ 592,193 $ 479,016 $ 445,227 New equipment sales 262,948 203,301 196,688 Used equipment sales 125,125 107,329 96,910 Parts sales 120,454 114,253 115,989 Services revenues 63,488 62,873 64,673 Total segmented revenues 1,164,208 966,772 919,487 Non-Segmented revenues 74,753 63,247 58,650 Total revenues $ 1,238,961 $ 1,030,019 $ 978,137 Segment Gross Profit: Equipment rentals $ 294,220 $ 231,855 $ 211,118 New equipment sales 30,891 22,599 21,132 Used equipment sales 39,073 33,197 30,172 Parts sales 32,191 31,118 31,662 Services revenues 42,160 41,762 42,834 Total gross profit from segmented revenues 438,535 360,531 336,918 Non-Segmented gross profit (loss) (1 ) (623 ) (1,307 ) Total gross profit $ 438,534 $ 359,908 $ 335,611 December 31, 2018 2017 Segment identified assets: Equipment sales $ 86,583 $ 58,125 Equipment rentals 1,141,498 904,824 Parts and service 18,015 16,879 Total segment identified assets 1,246,096 979,828 Non-Segmented identified assets 481,085 487,889 Total assets $ 1,727,181 $ 1,467,717 The Company operates primarily in the United States and our sales to international customers for the years ended December 31, 2018, 2017 and 2016 were 0.1%, 0.4% and 0.4%, respectively, of total revenues for the periods presented. No one customer accounted for more than 10% of our revenues on an overall or segmented basis for any of the periods presented. |
Consolidating Financial Informa
Consolidating Financial Information of Guarantor Subsidiaries | 12 Months Ended |
Dec. 31, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Consolidating Financial Information of Guarantor Subsidiaries | (19) Consolidating Financial Information of Guarantor Subsidiaries All of the indebtedness of H&E Equipment Services, Inc. is guaranteed by GNE Investments, Inc. and its wholly-owned subsidiary Great Northern Equipment, Inc., H&E Equipment Services (California), LLC, H&E California Holding, Inc., H&E Equipment Services (Mid-Atlantic), Inc. and H&E Finance Corp. The guarantor subsidiaries are all wholly-owned and the guarantees, made on a joint and several basis, are full and unconditional (subject to subordination provisions and subject to a standard limitation which provides that the maximum amount guaranteed by each guarantor will not exceed the maximum amount that can be guaranteed without making the guarantee void under fraudulent conveyance laws). There are no restrictions on H&E Equipment Services, Inc.’s ability to obtain funds from the guarantor subsidiaries by dividend or loan. The consolidating financial statements of H&E Equipment Services, Inc. and its subsidiaries are included below. The financial statements for H&E Finance Corp. are not included within the consolidating financial statements because H&E Finance Corp. has no assets or operations. CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2018 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 16,677 $ — $ — $ 16,677 Receivables, net 166,393 35,163 — 201,556 Inventories, net 94,483 10,115 — 104,598 Prepaid expenses and other assets 10,382 126 — 10,508 Rental equipment, net 983,281 158,217 — 1,141,498 Property and equipment, net 98,251 16,870 — 115,121 Deferred financing costs, net 3,000 — — 3,000 Investment in guarantor subsidiaries 246,309 — (246,309 ) — Intangible assets, net 28,380 — — 28,380 Goodwill 76,317 29,526 — 105,843 Total assets $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 Liabilities and Stockholders’ Equity: Amount due on senior secured credit facility $ 170,761 $ — $ — $ 170,761 Accounts payable 95,866 5,974 — 101,840 Manufacturer flooring plans payable 23,178 488 — 23,666 Accrued expenses payable and other liabilities 76,798 (3,427 ) — 73,371 Dividends payable 185 (53 ) — 132 Senior unsecured notes 944,780 — — 944,780 Capital leases payable — 726 — 726 Deferred income taxes 153,113 — — 153,113 Deferred compensation payable 1,989 — — 1,989 Total liabilities 1,466,670 3,708 — 1,470,378 Stockholders’ equity 256,803 246,309 (246,309 ) 256,803 Total liabilities and stockholders’ equity $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2017 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 165,878 $ — $ — $ 165,878 Receivables, net 138,657 37,424 — 176,081 Inventories, net 63,828 11,176 — 75,004 Prepaid expenses and other assets 9,030 142 — 9,172 Rental equipment, net 760,972 143,852 — 904,824 Property and equipment, net 89,952 11,837 — 101,789 Deferred financing costs, net 3,772 — — 3,772 Investment in guarantor subsidiaries 222,217 — (222,217 ) — Goodwill 1,671 29,526 — 31,197 Total assets $ 1,455,977 $ 233,957 $ (222,217 ) $ 1,467,717 Liabilities and Stockholders’ Equity: Amount due on senior secured credit facility $ — $ — $ — $ — Accounts payable 78,811 10,970 — 89,781 Manufacturer flooring plans payable 20,300 1,702 — 22,002 Accrued expenses payable and other liabilities 67,466 (2,371 ) — 65,095 Dividends payable 197 (47 ) — 150 Senior unsecured notes 944,088 — — 944,088 Capital leases payable — 1,486 — 1,486 Deferred income taxes 126,419 — — 126,419 Deferred compensation payable 1,903 — — 1,903 Total liabilities 1,239,184 11,740 — 1,250,924 Stockholders’ equity 216,793 222,217 (222,217 ) 216,793 Total liabilities and stockholders’ equity $ 1,455,977 $ 233,957 $ (222,217 ) $ 1,467,717 CONDENSED CONSOLIDATING STATEMENT OF INCOME Year Ended December 31, 2018 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 506,620 $ 85,573 $ — $ 592,193 New equipment sales 207,564 55,384 — 262,948 Used equipment sales 102,005 23,120 — 125,125 Parts sales 103,586 16,868 — 120,454 Services revenues 53,534 9,954 — 63,488 Other 62,633 12,120 — 74,753 Total revenues 1,035,942 203,019 — 1,238,961 Cost of revenues: Rental depreciation 178,371 30,082 — 208,453 Rental expense 76,487 13,033 — 89,520 New equipment sales 183,164 48,893 — 232,057 Used equipment sales 69,960 16,092 — 86,052 Parts sales 76,425 11,838 — 88,263 Services revenues 18,100 3,228 — 21,328 Other 62,745 12,009 — 74,754 Total cost of revenues 665,252 135,175 — 800,427 Gross profit (loss): Equipment rentals 251,762 42,458 — 294,220 New equipment sales 24,400 6,491 — 30,891 Used equipment sales 32,045 7,028 — 39,073 Parts sales 27,161 5,030 — 32,191 Services revenues 35,434 6,726 — 42,160 Other (112 ) 111 — (1 ) Gross profit 370,690 67,844 — 438,534 Selling, general and administrative expenses 232,892 45,406 — 278,298 Equity in earnings of guarantor subsidiaries 13,247 — (13,247 ) — Merger costs 708 — — 708 Gain from sales of property and equipment, net 6,475 643 — 7,118 Income from operations 156,812 23,081 (13,247 ) 166,646 Other income (expense): Interest expense (53,681 ) (10,026 ) — (63,707 ) Other, net 1,532 192 — 1,724 Total other expense, net (52,149 ) (9,834 ) — (61,983 ) Income before provision for income taxes 104,663 13,247 (13,247 ) 104,663 Provision for income taxes 28,040 — — 28,040 Net income $ 76,623 $ 13,247 $ (13,247 ) $ 76,623 CONDENSED CONSOLIDATING STATEMENT OF INCOME Year Ended December 31, 2017 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 395,275 $ 83,741 $ — $ 479,016 New equipment sales 166,730 36,571 — 203,301 Used equipment sales 84,741 22,588 — 107,329 Parts sales 97,852 16,401 — 114,253 Services revenues 52,807 10,066 — 62,873 Other 51,627 11,620 — 63,247 Total revenues 849,032 180,987 — 1,030,019 Cost of revenues: Rental depreciation 140,489 28,966 — 169,455 Rental expense 64,598 13,108 — 77,706 New equipment sales 148,163 32,539 — 180,702 Used equipment sales 59,481 14,651 — 74,132 Parts sales 71,603 11,532 — 83,135 Services revenues 17,851 3,260 — 21,111 Other 52,068 11,802 — 63,870 Total cost of revenues 554,253 115,858 — 670,111 Gross profit (loss): Equipment rentals 190,188 41,667 — 231,855 New equipment sales 18,567 4,032 — 22,599 Used equipment sales 25,260 7,937 — 33,197 Parts sales 26,249 4,869 — 31,118 Services revenues 34,956 6,806 — 41,762 Other (441 ) (182 ) — (623 ) Gross profit 294,779 65,129 — 359,908 Selling, general and administrative expenses 190,392 42,392 — 232,784 Equity in earnings of guarantor subsidiaries 16,136 — (16,136 ) — Merger breakup fees, net of merger costs (5,782 ) — — (5,782 ) Gain from sales of property and equipment, net 2,435 2,574 — 5,009 Income from operations 128,740 25,311 (16,136 ) 137,915 Other income (expense): Interest expense (45,480 ) (9,478 ) — (54,958 ) Loss on early extinguishment of debt (25,363 ) — — (25,363 ) Other, net 1,447 303 — 1,750 Total other expense, net (69,396 ) (9,175 ) — (78,571 ) Income before benefit for income taxes 59,344 16,136 (16,136 ) 59,344 Benefit for income taxes (50,314 ) — — (50,314 ) Net income $ 109,658 $ 16,136 $ (16,136 ) $ 109,658 CONDENSED CONSOLIDATING STATEMENT OF INCOME Year Ended December 31, 2016 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 364,654 $ 80,573 $ — $ 445,227 New equipment sales 158,291 38,397 — 196,688 Used equipment sales 78,956 17,954 — 96,910 Parts sales 100,920 15,069 — 115,989 Services revenues 55,391 9,282 — 64,673 Other 47,461 11,189 — 58,650 Total revenues 805,673 172,464 — 978,137 Cost of revenues: Rental depreciation 134,484 27,931 — 162,415 Rental expense 59,263 12,431 — 71,694 New equipment sales 140,948 34,608 — 175,556 Used equipment sales 55,075 11,663 — 66,738 Parts sales 73,587 10,740 — 84,327 Services revenues 18,963 2,876 — 21,839 Other 48,273 11,684 — 59,957 Total cost of revenues 530,593 111,933 — 642,526 Gross profit (loss): Equipment rentals 170,907 40,211 — 211,118 New equipment sales 17,343 3,789 — 21,132 Used equipment sales 23,881 6,291 — 30,172 Parts sales 27,333 4,329 — 31,662 Services revenues 36,428 6,406 — 42,834 Other (812 ) (495 ) — (1,307 ) Gross profit 275,080 60,531 — 335,611 Selling, general and administrative expenses 187,369 40,760 — 228,129 Equity in earnings of guarantor subsidiaries 11,416 — (11,416 ) — Gain from sales of property and equipment, net 2,789 496 — 3,285 Income from operations 101,916 20,267 (11,416 ) 110,767 Other income (expense): Interest expense (44,503 ) (9,101 ) — (53,604 ) Other, net 1,617 250 — 1,867 Total other expense, net (42,886 ) (8,851 ) — (51,737 ) Income before provision for income taxes 59,030 11,416 (11,416 ) 59,030 Provision for income taxes 21,858 — — 21,858 Net income $ 37,172 $ 11,416 $ (11,416 ) $ 37,172 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Year Ended December 31, 2018 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 76,623 $ 13,247 $ (13,247 ) $ 76,623 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 21,570 3,023 — 24,593 Depreciation on rental equipment 178,371 30,082 — 208,453 Amortization of intangible assets 3,320 — — 3,320 Amortization of deferred financing costs 1,083 — — 1,083 Accretion of note discount, net of premium amortization 477 — — 477 Provision for losses on accounts receivable 2,065 676 — 2,741 Provision for inventory obsolescence 122 — — 122 Change in deferred income taxes 26,695 — — 26,695 Stock-based compensation expense 4,214 — — 4,214 Gain from sales of property and equipment, net (6,475 ) (643 ) — (7,118 ) Gain from sales of rental equipment, net (31,595 ) (6,757 ) — (38,352 ) Equity in earnings of guarantor subsidiaries (13,247 ) — 13,247 — Changes in operating assets and liabilities, net of acquisitions: Receivables (19,346 ) 1,585 — (17,761 ) Inventories (45,349 ) (2,881 ) — (48,230 ) Prepaid expenses and other assets (981 ) 16 — (965 ) Accounts payable 11,990 (4,996 ) — 6,994 Manufacturer flooring plans payable 2,878 (1,214 ) — 1,664 Accrued expenses payable and other liabilities 4,176 (1,604 ) — 2,572 Deferred compensation payable 86 — — 86 Net cash provided by operating activities 216,677 30,534 — 247,211 Cash flows from investing activities: Acquisition of business, net of cash acquired (196,027 ) — — (196,027 ) Purchases of property and equipment (26,903 ) (8,057 ) — (34,960 ) Purchases of rental equipment (362,780 ) (53,820 ) — (416,600 ) Proceeds from sales of property and equipment 8,617 644 — 9,261 Proceeds from sales of rental equipment 92,014 20,072 — 112,086 Investment in subsidiaries (10,845 ) — 10,845 — Net cash used in investing activities (495,924 ) (41,161 ) 10,845 (526,240 ) Cash flows from financing activities: Purchases of treasury stock (1,350 ) — — (1,350 ) Borrowings on senior secured credit facility 1,436,849 — — 1,436,849 Payments on senior secured credit facility (1,266,088 ) — — (1,266,088 ) Dividends paid (39,268 ) (6 ) — (39,274 ) Payments of deferred financing costs (97 ) — — (97 ) Payments of capital lease obligations — (212 ) — (212 ) Capital contributions — 10,845 (10,845 ) — Net cash provided by financing activities 130,046 10,627 (10,845 ) 129,828 Net decrease in cash (149,201 ) — — (149,201 ) Cash, beginning of year 165,878 — — 165,878 Cash, end of year $ 16,677 $ — $ — $ 16,677 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Year Ended December 31, 2017 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 109,658 $ 16,136 $ (16,136 ) $ 109,658 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 20,742 3,048 — 23,790 Depreciation on rental equipment 140,489 28,966 — 169,455 Amortization of deferred financing costs 1,046 — — 1,046 Accretion of note discount, net of premium amortization 274 — — 274 Provision for losses on accounts receivable 3,148 784 — 3,932 Provision for inventory obsolescence 161 — — 161 Change in deferred income taxes (50,535 ) — — (50,535 ) Stock-based compensation expense 3,526 — — 3,526 Loss on early extinguishment of debt 25,363 — — 25,363 Gain from sales of property and equipment, net (2,435 ) (2,574 ) — (5,009 ) Gain from sales of rental equipment, net (24,063 ) (7,819 ) — (31,882 ) Equity in earnings of guarantor subsidiaries (16,136 ) — 16,136 — Changes in operating assets and liabilities: Receivables (29,083 ) (10,929 ) — (40,012 ) Inventories (23,221 ) (8,550 ) — (31,771 ) Prepaid expenses and other assets (1,687 ) 28 — (1,659 ) Accounts payable 42,623 7,726 — 50,349 Manufacturer flooring plans payable (10,599 ) 1,821 — (8,778 ) Accrued expenses payable and other liabilities 8,660 (430 ) — 8,230 Deferred compensation payable 61 — — 61 Net cash provided by operating activities 197,992 28,207 — 226,199 Cash flows from investing activities: Purchases of property and equipment (17,852 ) (4,663 ) — (22,515 ) Purchases of rental equipment (198,988 ) (35,221 ) — (234,209 ) Proceeds from sales of property and equipment 3,528 3,978 — 7,506 Proceeds from sales of rental equipment 74,090 22,053 — 96,143 Investment in subsidiaries 14,128 — (14,128 ) — Net cash used in investing activities (125,094 ) (13,853 ) (14,128 ) (153,075 ) Cash flows from financing activities: Purchases of treasury stock (783 ) — — (783 ) Borrowings on senior secured credit facility 1,193,544 — — 1,193,544 Payments on senior secured credit facility (1,356,186 ) — — (1,356,186 ) Dividends paid (39,164 ) (8 ) — (39,172 ) Principal payments on senior unsecured notes due 2023 (630,000 ) — — (630,000 ) Costs paid to tender and redeem senior unsecured notes due 2022 (23,336 ) — — (23,336 ) Proceeds from issuance of senior unsecured notes due 2025 958,500 — — 958,500 Payments of deferred financing costs (17,278 ) — — (17,278 ) Payments of capital lease obligations — (218 ) — (218 ) Capital contributions — (14,128 ) 14,128 — Net cash provided by (used in) financing activities 85,297 (14,354 ) 14,128 85,071 Net increase in cash 158,195 — — 158,195 Cash, beginning of year 7,683 — — 7,683 Cash, end of year $ 165,878 $ — $ — $ 165,878 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Year Ended December 31, 2016 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 37,172 $ 11,416 $ (11,416 ) $ 37,172 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 24,194 3,088 — 27,282 Depreciation on rental equipment 134,484 27,931 — 162,415 Amortization of deferred financing costs 1,052 — — 1,052 Accretion of note discount, net of premium amortization 168 — — 168 Provision for losses on accounts receivable 2,616 521 — 3,137 Provision for inventory obsolescence 127 — — 127 Change in deferred income taxes 21,578 — — 21,578 Stock-based compensation expense 3,037 — — 3,037 Gain from sales of property and equipment, net (2,789 ) (496 ) — (3,285 ) Gain from sales of rental equipment, net (22,780 ) (6,223 ) — (29,003 ) Equity in earnings of guarantor subsidiaries (11,416 ) — 11,416 — Changes in operating assets and liabilities: Receivables 8,783 (4,629 ) — 4,154 Inventories 5,785 (1,518 ) — 4,267 Prepaid expenses and other assets 2,566 (25 ) — 2,541 Accounts payable (27,771 ) 426 — (27,345 ) Manufacturer flooring plans payable (31,534 ) (119 ) — (31,653 ) Accrued expenses payable and other liabilities 2,263 (596 ) — 1,667 Deferred compensation payable (332 ) — — (332 ) Net cash provided by operating activities 147,203 29,776 — 176,979 Cash flows from investing activities: Purchases of property and equipment (19,505 ) (3,390 ) — (22,895 ) Purchases of rental equipment (138,562 ) (41,147 ) — (179,709 ) Proceeds from sales of property and equipment 3,190 615 — 3,805 Proceeds from sales of rental equipment 67,282 17,107 — 84,389 Investment in subsidiaries 2,749 — (2,749 ) — Net cash used in investing activities (84,846 ) (26,815 ) (2,749 ) (114,410 ) Cash flows from financing activities: Purchases of treasury stock (561 ) — — (561 ) Borrowing on senior secured credit facility 966,146 — — 966,146 Payments on senior secured credit facility (988,361 ) — — (988,361 ) Dividends paid (39,057 ) (9 ) — (39,066 ) Payments of capital lease obligations — (203 ) — (203 ) Capital contributions — (2,749 ) 2,749 — Net cash used in financing activities (61,833 ) (2,961 ) 2,749 (62,045 ) Net increase in cash 524 — — 524 Cash, beginning of year 7,159 — — 7,159 Cash, end of year $ 7,683 $ — $ — $ 7,683 |
Validation And Qualifying Accou
Validation And Qualifying Accounts | 12 Months Ended |
Dec. 31, 2018 | |
Valuation And Qualifying Accounts [Abstract] | |
Valuation and Qualifying Accounts | FOR THE YEARS ENDED DECEMBER 31, 2018, 2017 AND 2016 (Amounts in thousands) Description Balance at Beginning of Year Additions Charged to Costs and Expenses Deductions Balance at End of Year Year Ended December 31, 2018 Allowance for doubtful accounts receivable $ 3,774 $ 2,741 $ (2,421 ) $ 4,094 Allowance for inventory obsolescence 947 122 (701 ) 368 $ 4,721 $ 2,863 $ (3,122 ) $ 4,462 Year Ended December 31, 2017 Allowance for doubtful accounts receivable $ 3,769 $ 3,932 $ (3,927 ) $ 3,774 Allowance for inventory obsolescence 900 161 (114 ) 947 $ 4,669 $ 4,093 $ (4,041 ) $ 4,721 Year Ended December 31, 2016 Allowance for doubtful accounts receivable $ 4,729 $ 3,137 $ (4,097 ) $ 3,769 Allowance for inventory obsolescence 934 127 (161 ) 900 $ 5,663 $ 3,264 $ (4,258 ) $ 4,669 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation Our consolidated financial statements include the financial position and results of operations of H&E Equipment Services, Inc. and its wholly-owned subsidiaries H&E Finance Corp., GNE Investments, Inc., Great Northern Equipment, Inc., H&E California Holding, Inc., H&E Equipment Services (California), LLC and H&E Equipment Services (Mid-Atlantic), Inc., collectively referred to herein as “we” or “us” or “our” or the “Company.” All significant intercompany accounts and transactions have been eliminated in these consolidated financial statements. Business combinations are included in the consolidated financial statements from their respective dates of acquisition. The nature of our business is such that short-term obligations are typically met by cash flows generated from long-term assets. Consequently, and consistent with industry practice, the accompanying consolidated balance sheets are presented on an unclassified basis. |
Use of Estimates | Use of Estimates We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, which requires management to use its judgment to make estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. These assumptions and estimates could have a material effect on our condensed consolidated financial statements. Actual results may differ materially from those estimates. We review our estimates on an ongoing basis based on information currently available, and changes in facts and circumstances may cause us to revise these estimates. |
Revenue Recognition | Revenue Recognition In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Entities may use a full retrospective approach or report on the cumulative effect as of the date of adoption. We adopted this standard effective January 1, 2018 using the full retrospective transition method. As further discussed below, upon the adoption of Topic 606 on January 1, 2018, we recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 840 (which addresses lease accounting). As discussed below in “Pronouncements Not Yet Adopted”, Topic 842 superseded Topic 840 effective January 1, 2019. Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services. Nature of goods and services The tables below summarize our revenues as presented in our consolidated statements of income for the years ended December 31, 2018, 2017 and 2016 by revenue type and by the applicable accounting standard (amounts in thousands). Year Ended December 31, 2018 2017 Topic 840 Topic 606 Total Topic 840 Topic 606 Total Rental revenues $ 590,858 $ 1,335 $ 592,193 $ 476,978 $ 2,038 $ 479,016 New equipment sales ─ 262,948 262,948 ─ 203,301 203,301 Used equipment sales ─ 125,125 125,125 ─ 107,329 107,329 Parts sales ─ 120,454 120,454 ─ 114,253 114,253 Service revenues ─ 63,488 63,488 ─ 62,873 62,873 Other 21,693 53,060 74,753 17,791 45,456 63,247 Total revenues $ 612,551 $ 626,410 $ 1,238,961 $ 494,769 $ 535,250 $ 1,030,019 Year Ended December 31, 2016 Topic 840 Topic 606 Total Rental revenues $ 443,148 $ 2,079 $ 445,227 New equipment sales ─ 196,688 196,688 Used equipment sales ─ 96,910 96,910 Parts sales ─ 115,989 115,989 Service revenues ─ 64,673 64,673 Other 16,199 42,451 58,650 Total revenues $ 459,347 $ 518,790 $ 978,137 Revenues by reporting segment are presented in note 18 of our condensed consolidated financial statements, using the revenue captions reflected in our consolidated statements of income. We believe that the disaggregation of our revenues from contracts to customers as reflected above, coupled with further discussion below and the reporting segment in note 18, depicts how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by economic factors. Lease revenues (Topic 840) Rental Revenues: Owned equipment rentals represent revenues from renting equipment. We account for these rental contracts as operating leases. We recognize revenue from equipment rentals in the period earned, regardless of the timing of billing to customers. A rental contract includes rates for daily, weekly or monthly use, and rental revenues are earned on a daily basis as rental contracts remain outstanding. Because the rental contracts can extend across multiple reporting periods, we record unbilled rental revenues and deferred rental revenues at the end of reporting periods so rental revenues earned is appropriately stated for the periods presented. Other: Other rental revenues primarily represent services performed by us in connection with the rental of equipment to a customer, such as fuel consumption charges, environmental fees and damage waiver insurance. Fuel consumption charges are recognized upon return of the rental equipment when fuel consumption by the customer, if any, can be measured. Income from environmental fees and damage waiver insurance policies are recognized when earned over the period the equipment is rented. See discussion below in “Pending Accounting Pronouncements Not Yet Adopted” for the expected impact of adopting Topic 842, which became effective for us on January 1, 2019. Revenues from contracts with customers (Topic 606) The accounting for the types of revenues accounted for pursuant to Topic 606 are discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time. Rental revenues: An insignificant portion of our total equipment rental revenues are recognized pursuant to Topic 606 rather than pursuant to Topic 840. These revenues represent services performed by us in connection with the rental of equipment and are comprised of customer training fees on rented equipment and erection and dismantling services on rental equipment. Revenues for these services are recognized upon completion of such services. See discussion above regarding rental revenues recognized pursuant to Topic 840. New equipment sales: Revenues from the sales of new equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Used equipment sales: Revenues from the sales of used equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good. Parts sales: Revenues from the sales of equipment parts are recognized at the time of pick-up by the customer for parts counter sales transactions. For parts that are shipped to a customer, we elected to use a practical expedient of Topic 606 and treat such shipping activities as fulfillment costs, thereby recognizing revenues at the time of shipment. Services revenues: We derive our services primarily from maintenance and repair services to customers for their owned equipment. We recognize services revenues at the time such services are completed, which is when the customer obtains control of the promised service. Other revenues : Other revenues relate primarily to hauling fees for transporting rental equipment and equipment sold to and from the customer and ancillary charges associated with equipment maintenance and repair services. Such revenues are recognized at the time the services are performed. Receivables and contract assets and liabilities We manage credit risk associated with our accounts receivables at the customer level. Because the same customers typically generate the revenues that are accounted for under both Topic 606 and Topic 840, the discussions below on credit risk and our allowances for doubtful accounts address our total revenues from Topic 606 and Topic 840. We believe concentration of credit risk with respect to our receivables is limited because our customer base is comprised of a large number of geographically diverse customers. Our largest customer accounted for approximately 1.2% of total revenues for the year ended December 31, 2018 and for less than one percent of total revenues for the years ended December 31, 2017 and 2016. No single customer accounted for more than 10% of our revenues on an overall or segment basis for any of the periods presented in this Annual Report on Form 10-K. We manage credit risk through credit approvals, credit limits and other monitoring procedures. We maintain an allowance for doubtful accounts that reflects our estimate of the amount of our receivables that we will be unable to collect. We develop our estimate of this allowance based on our historical experience with specific customers, our understanding of our current economic circumstances and our own judgment as to the likelihood of ultimate payment. Our largest exposure to doubtful accounts is in our rental operations. We perform credit evaluations of customers and establish credit limits based on reviews of our customers’ current credit information and payment histories. We believe our credit risk is somewhat mitigated by our geographically diverse customer base and our credit evaluation procedures. During the year, we write-off customer account balances when we have exhausted reasonable collection efforts and determined that the likelihood of collection is remote. Such write-offs are charged against our allowance for doubtful accounts. Bad debt expense as a percentage of total revenues for the years ended December 31, 2018, 2017 and 2016 were approximately 0.2%, 0.4% and 0.3%, respectively. The actual rate of future credit losses, however, may not be similar to past experience. Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance for doubtful accounts. We do not have material contract assets, impairment losses associated therewith, or material contract liabilities associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenues during the years ended December 31, 2018, 2017 or 2016 that was included in the contract liability balance as of the beginning of such periods. Performance obligations Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amount of such revenue recognized during the years ended December 31, 2018, 2017 and 2016 was not material. We also do not expect to recognize material revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2018. Payment terms Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk. Sales tax amounts collected from customers are recorded on a net basis. Contract costs We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. Contract estimates and judgments Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments as the transaction price is generally fixed and stated on our contracts. Our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation. Also, our revenues do not include material amounts of variable consideration. Substantially all of our revenues are recognized at a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenues are generally recognized at the time of delivery to, or pick-up by, the customer. |
Inventories | Inventories We measure inventory at the lower of cost or net realizable value; where net realizable value is considered to be estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation. For new and used equipment inventories, cost is determined by specific-identification. For inventories of parts and supplies, cost is determined by using average cost. |
Long-lived Assets and Goodwill | Long-lived Assets and Goodwill Rental Equipment The rental equipment we purchase is stated at cost and is depreciated over the estimated useful life of the equipment using the straight-line method. Estimated useful lives vary based upon type of equipment. Generally, we depreciate cranes and aerial work platforms over a ten year estimated useful life, earthmoving equipment over a five year estimated useful life with a 25% salvage value, and industrial lift trucks over a seven year estimated useful life. Attachments and other smaller type equipment are depreciated generally over a three year estimated useful life. We periodically evaluate the appropriateness of remaining depreciable lives and any salvage value assigned to rental equipment. Ordinary repair and maintenance costs and property taxes are charged to operations as incurred. However, expenditures for additions or improvements that significantly extend the useful life of the asset are capitalized in the period incurred. When rental equipment is sold or disposed of, the related cost and accumulated depreciation are removed from the respective accounts and any gains or losses are included in income. We receive individual offers for fleet on a continual basis, at which time we perform an analysis on whether or not to accept the offer. The rental equipment is not transferred to inventory under the held for sale model as the equipment is used to generate revenues until the equipment is sold. Property and Equipment Property and equipment are recorded at cost and are depreciated over the assets’ estimated useful lives using the straight-line method. Ordinary repair and maintenance costs are charged to operations as incurred. However, expenditures for additions or improvements that significantly extend the useful life of the asset are capitalized in the period incurred. At the time assets are sold or disposed of, the cost and accumulated depreciation are removed from their respective accounts and the related gains or losses are reflected in income. We capitalize interest on qualified construction projects. Costs associated with internally developed software are accounted for in accordance with FASB Accounting Standards Codification (“ASC”) 350-40, Internal-Use Software We periodically evaluate the appropriateness of remaining depreciable lives assigned to property and equipment. Leasehold improvements are amortized using the straight-line method over their estimated useful lives or the remaining term of the lease, whichever is shorter. Generally, we assign the following estimated useful lives to these categories: Category Estimated Useful Life Transportation equipment 5 years Buildings 39 years Office equipment 5 years Computer equipment 3 years Machinery and equipment 7 years In accordance with ASC 360, Property, Plant and Equipment Goodwill We have made acquisitions in the past that included the recognition of goodwill, which was determined based upon previous accounting principles. Pursuant to ASC 350, Intangibles-Goodwill and Other We evaluate goodwill for impairment at least annually, or more frequently if triggering events occur or other impairment indicators arise which might impair recoverability. Impairment of goodwill is evaluated at the reporting unit level. A reporting unit is defined as an operating segment (i.e. before aggregation or combination), or one level below an operating segment (i.e. a component). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. We have identified two components within our Rental operating segment and have determined that each of our other operating segments (New, Used, Parts and Service) represent a reporting unit, resulting in six total reporting units. ASC 350 allows entities to first use a qualitative approach to test goodwill for impairment. ASC 350 permits an entity to first perform a qualitative assessment to determine whether it is more likely than not (a likelihood of greater than 50%) that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, the currently prescribed two-step goodwill test must be performed. Otherwise, the two-step goodwill impairment test is not required. Considerable judgment is required by management in using the qualitative approach under ASC 350 to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. We performed a qualitative assessment as of October 1, 2018 and 2017, and there was no goodwill impairment. ASC 350 suggests that a qualitative assessment may become less relevant over time. In other words, the longer it has been since the last quantitative assessment, the more difficult it could be for a company to conclude that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. Our last quantitative assessment of goodwill impairment was as of October 1, 2016. Step 1 of that test determined that the fair values of the goodwill reporting units exceeded their respective carrying values and, therefore, Step 2 of the goodwill test was not required, as there was no goodwill impairment at October 1, 2016. The changes in the carrying amount of goodwill for our reporting units for the years ended December 31, 2018 and 2017 were as follows (amounts in thousands): Eq. Rental Comp. 1 Eq. Rental Comp. 2 New Eq. Sales Used Eq. Sales Parts Sales Services Revenues Total Balance at December 31, 2016 $ ─ $ 18,700 $ ─ $ 6,137 $ 6,360 $ ─ $ 31,197 Increases (Decreases) ─ ─ ─ ─ ─ ─ ─ Balance at December 31, 2017 ─ 18,700 ─ 6,137 6,360 ─ 31,197 Increases (1) 34,297 23,836 10,434 2,324 2,550 1,205 74,646 Decreases ─ ─ ─ ─ ─ ─ ─ Balance at December 31, 2018 $ 34,297 $ 42,536 $ 10,434 $ 8,461 $ 8,910 $ 1,205 $105,843 (1) Increases are related to goodwill recognized in the CEC and Rental Inc. 2018 acquisitions. See footnote 3 for further information. |
Closed Branch Facility Charges | Closed Branch Facility Charges We continuously monitor and identify branch facilities with revenues and operating margins that consistently fall below Company performance standards. Once identified, we continue to monitor these branches to determine if operating performance can be improved or if the performance is attributable to economic factors unique to the particular market with unfavorable long-term prospects. If necessary, branches with unfavorable long-term prospects are closed and the rental fleet and new and used equipment inventories are deployed to more profitable branches within our geographic footprint where demand is higher. We closed one branch during each of the years ended December 31, 2018 and 2017 in markets where long-term prospects did not support continued operations. No branches were closed during 2016. Under ASC 420, Exit or Disposal Cost Obligations |
Deferred Financing Costs and Initial Purchasers' Discounts | Deferred Financing Costs and Initial Purchasers’ Discounts Deferred financing costs include legal, accounting and other direct costs incurred in connection with the issuance and amendments thereto, of the Company’s debt. These costs are amortized over the terms of the related debt using the straight-line method which approximates amortization using the effective interest method. Initial purchasers’ discount and bond premium is the differential between the price paid to an issuer for the new issue and the prices (below and above, respectively) at which the securities are initially offered to the investing public. The amortization expense of deferred financing costs and bond premium and accretion of initial purchasers’ discounts are included in interest expense as an overall cost of the related financings. Such costs are presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. |
Reserves for Claims | Reserves for Claims We are exposed to various claims relating to our business, including those for which we provide self-insurance. Claims for which we self-insure include: (1) workers compensation claims; (2) general liability claims by third parties for injury or property damage caused by our equipment or personnel; (3) automobile liability claims; and (4) employee health insurance claims. These types of claims may take a substantial amount of time to resolve and, accordingly, the ultimate liability associated with a particular claim, including claims incurred but not reported as of a period-end reporting date, may not be known for an extended period of time. Our methodology for developing self-insurance reserves is based on management estimates and independent third party actuarial estimates. Our estimation process considers, among other matters, the cost of known claims over time, cost inflation and incurred but not reported claims. These estimates may change based on, among other things, changes in our claim history or receipt of additional information relevant to assessing the claims. Further, these estimates may prove to be inaccurate due to factors such as adverse judicial determinations or other claim settlements at higher than estimated amounts. Accordingly, we may be required to increase or decrease our reserve levels. At December 31, 2018, our claims reserves related to workers compensation, general liability and automobile liability, which are included in “Accrued expenses and other liabilities” in our consolidated balance sheets, totaled $4.8 million and our health insurance reserves totaled $1.3 million. At December 31, 2017, our claims reserves related to workers compensation, general liability and automobile liability totaled $4.6 million and our health insurance reserves totaled $1.2 million. |
Advertising | Advertising Advertising costs are expensed as incurred and totaled $0.5 million, $0.5 million and $1.0 million for the years ended December 31, 2018, 2017 and 2016, respectively. |
Income Taxes | Income Taxes The Company files a consolidated federal income tax return with its wholly-owned subsidiaries. The Company is a C-Corporation under the provisions of the Internal Revenue Code. We utilize the asset and liability approach to measure deferred tax assets and liabilities based on temporary differences existing at each balance sheet date using currently enacted tax rates in accordance with ASC 740. ASC 740 takes into account the differences between financial statement treatment and tax treatment of certain transactions. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rate is recognized as income or expense in the period that includes the enactment date of that rate. On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into law. Included in the Act is a reduction in the corporate statutory tax rate from 35% to 21%, effective for us on January 1, 2018. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period in which the new legislation is enacted. In the case of US federal income taxes, the enactment date is the date the bill becomes law (i.e., upon presidential signature), and we recognized the impact of the Act in our consolidated financial statements for the year ended December 31, 2017. We have completed our accounting for all the tax effects of the enactment of the Act. In accordance with ASC 740, the Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax provisions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company recognizes both interest and penalties related to uncertain tax positions in net other income (expense). Our deferred tax calculation requires management to make certain estimates about future operations. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The FASB fair value measurement guidance established a fair value hierarchy that prioritizes the inputs used to measure fair value. The three broad levels of the fair value hierarchy are as follows: Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 – Quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly Level 3 – Unobservable inputs for which little or no market data exists, therefore requiring a company to develop its own assumptions The carrying value of financial instruments reported in the accompanying consolidated balance sheets for cash, accounts receivable, accounts payable and accrued expenses payable and other liabilities approximate fair value due to the immediate or short-term nature or maturity of these financial instruments. The fair value of our letter of credit is based on fees currently charged for similar agreements. The carrying amounts and fair values of our other financial instruments subject to fair value disclosures as of December 31, 2018 and 2017 are presented in the table below (amounts in thousands) and have been calculated based upon market quotes and present value calculations based on market rates. December 31, 2018 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) $ 23,666 $ 19,870 Senior unsecured notes due 2025 with interest computed at 5.625% (Level 2) 944,780 871,625 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 726 330 Letter of credit (Level 3) — 116 December 31, 2017 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 4.50% (Level 3) $ 22,002 $ 18,737 Senior unsecured notes due 2025 with interest computed at 5.625% (Level 3) 944,088 619,019 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 1,486 1,114 Letter of credit (Level 3) — 116 At December 31, 2018, the fair value of our senior unsecured notes due 2025 was based on quoted bond trading market prices for those notes. At December 31, 2017, the fair value of our senior unsecured notes due 2025 was based on our incremental borrowing rate as these notes were not available (registered) on a bond trading market as of December 31, 2017. |
Concentrations of Credit and Supplier Risk | Concentrations of Credit and Supplier Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade accounts receivable. Credit risk can be negatively impacted by adverse changes in the economy or by disruptions in the credit markets. However, we believe that credit risk with respect to trade accounts receivable is somewhat mitigated by our large number of geographically diverse customers and our credit evaluation procedures. Although generally no collateral is required, when feasible, mechanics’ liens are filed and personal guarantees are signed to protect the Company’s interests. We maintain reserves for potential losses. We record trade accounts receivables at sales value and establish specific reserves for certain customer accounts identified as known collection problems due to insolvency, disputes or other collection issues. The amounts of the specific reserves estimated by management are based on the following assumptions and variables: the customer’s financial position, age of the customer’s receivables and changes in payment schedules. In addition to the specific reserves, management establishes a non-specific allowance for doubtful accounts by applying specific percentages to the different receivable aging categories (excluding the specifically reserved accounts). The percentage applied against the aging categories increases as the accounts become further past due. The allowance for doubtful accounts is charged with the write-off of uncollectible customer accounts. We purchase a significant amount of equipment from the same manufacturers with whom we have distribution agreements. During the year ended December 31, 2018, we purchased approximately 54% from five manufacturers (Grove/Manitowoc, Genie Industries (Terex), JCB, Komatsu, and Skyjack) providing our rental and sales equipment. We believe that while there are alternative sources of supply for the equipment we purchase in each of the principal product categories, termination of one or more of our relationships with any of our major suppliers of equipment could have a material adverse effect on our business, financial condition or results of operation if we were unable to obtain adequate or timely rental and sales equipment. |
Income per Share | Income per Share Income per common share for the years ended December 31, 2018, 2017 and 2016 is based on the weighted average number of common shares outstanding during the period. The effects of potentially dilutive securities that are anti-dilutive are not included in the computation of diluted income per share. We include all common shares granted under our incentive compensation plan which remain unvested (“restricted common shares”) and contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid (“participating securities”), in the number of shares outstanding in our basic and diluted EPS calculations using the two-class method. All of our restricted common shares are currently participating securities. Under the two-class method, earnings per common share are computed by dividing the sum of distributed earnings allocated to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, distributed and undistributed earnings are allocated to both common shares and restricted common shares based on the total weighted average shares outstanding during the period. The number of restricted common shares outstanding during the years ended December 31, 2018, 2017 and 2016 were less than 1% of total outstanding shares for each of the years ended December 31, 2018, 2017 and 2016 and consequently, were immaterial to the basic and diluted EPS calculations. Therefore, use of the two-class method had no impact on our basic and diluted EPS calculations as presented for the years ended December 31, 2018, 2017 and 2016. The following table sets forth the computation of basic and diluted net income per common share for the years ended December 31, (amounts in thousands, except per share amounts): 2018 2017 2016 Basic net income per share: Net income $ 76,623 $ 109,658 $ 37,172 Weighted average number of common shares outstanding 35,677 35,516 35,393 Net income per common share — basic $ 2.15 $ 3.09 $ 1.05 Diluted net income per share: Net income $ 76,623 $ 109,658 $ 37,172 Weighted average number of common shares outstanding 35,677 35,516 35,393 Effect of dilutive securities: Effect of dilutive stock options — — — Effect of dilutive non-vested stock 226 183 87 Weighted average number of common shares outstanding — diluted 35,903 35,699 35,480 Net income per common share — diluted $ 2.13 $ 3.07 $ 1.05 Common shares excluded from the denominator as anti-dilutive: Stock options — — 4 Non-vested stock 43 — 3 |
Stock-Based Compensation | Stock-Based Compensation We adopted our 2006 Stock-Based Incentive Compensation Plan (as amended and restated from time to time, the “Prior Stock Plan”) and over the ten years prior to June 2016, we had been granting awards under our Prior Stock Plan. The Prior Stock Plan expired pursuant to its terms in June 2016, and the Company is no longer able to grant equity awards under the Prior Stock Plan. At our annual meeting of stockholders in May 2016, our stockholders approved our 2016 Stock-Based Incentive Compensation Plan (the “2016 Plan” and collectively with the Prior Stock Plan, the “Stock Plans”). To the extent that awards granted under the Prior Stock Plan are forfeited or otherwise terminate for any reason whatsoever without an actual distribution or issuance of shares, the plan limit will be increased by such number of shares. The Stock Plans are administered by the Compensation Committee of our Board of Directors, which selects persons eligible to receive awards and determines the number of shares and/or options subject to each award, the terms, conditions, performance measures, if any, and other provisions of the award. Under the Stock Incentive Plan, we may offer deferred shares or restricted shares of our common stock and grant options, including both incentive stock options and nonqualified stock options, to purchase shares of our common stock. Shares available for future stock-based payment awards under our Stock Incentive Plan were 1,734,986 shares of common stock as of December 31, 2018. We account for our stock-based compensation plans using the fair value recognition provisions of ASC 718, Stock Compensation Non-vested Stock From time to time, we issue shares of non-vested stock typically with vesting terms of three years. The following table summarizes our non-vested stock activity for the years ended December 31, 2018 and 2017: Number of Shares Weighted Average Grant Date Fair Value Non-vested stock at January 1, 2017 400,801 $ 18.86 Granted 190,134 $ 22.94 Vested (131,807 ) $ 21.85 Forfeited (13,164 ) $ 19.50 Non-vested stock at December 31, 2017 445,964 $ 19.70 Granted 143,121 $ 37.10 Vested (181,194 ) $ 20.53 Forfeited (28,332 ) $ 19.61 Non-vested stock at December 31, 2018 379,559 $ 25.87 As of December 31, 2018, we had unrecognized compensation expense of approximately $5.0 million related to non-vested stock award payments that we expect to be recognized over a weighted average period of 1.9 years. Stock compensation expense for the years ended December 31, 2018, 2017 and 2016 was $4.2 million, $3.5 million and $3.0 million, respectively. Stock Options No stock options were granted during 2018, 2017 or 2016. At December 31, 2018, we had no unrecognized compensation expense related to prior stock option awards. No stock compensation expense was recognized in 2018, 2017 or 2016 related to stock options. The following table represents stock option activity for the years ended December 31, 2018 and 2017: Number of Shares Weighted Average Exercise Price Weighted Average Contractual Life In Years Outstanding options at January 1, 2017 4,500 $ 19.27 0.5 Granted — — Exercised — — Canceled, forfeited or expired (4,500 ) 19.27 Outstanding options at December 31, 2017 — Granted — Exercised — Canceled, forfeited or expired — Outstanding options at December 31, 2018 — Options exercisable at December 31, 2018 — |
Purchases of Company Common Stock | Purchases of Company Common Stock Purchases of our common stock are accounted for as treasury stock in the accompanying consolidated balance sheets using the cost method. Repurchased stock is included in authorized shares, but is not included in shares outstanding. |
Segment Reporting | Segment Reporting We have determined in accordance with ASC 280, Segment Reporting |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Pronouncements Not Yet Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases . Originally, Topic 842 required all entities to use a modified retrospective transition approach that is intended to maximize comparability and be less complex than a full retrospective approach. Under the modified retrospective approach, Topic 842 is effectively implemented as of the beginning of the earliest comparative period presented in an entity’s financial statements. ASU 2018-11 amended Topic 842 so that entities may elect not to recast their comparative periods in transition and allows entities to change their date of initial application to the beginning of the period of adoption. In doing so, the entity would (1) apply Topic 840 in the comparative periods; (2) provide the disclosures required by Topic 840 for all periods that continue to be presented in accordance with Topic 840; and (3) recognize the effects of applying Topic 842 as a cumulative-effect adjustment to retained earnings as of January 1, 2019. Subsequent ASU’s were issued that provided additional clarification and guidance on the application of Topic 842. We expect to use the package of practical expedients that will allow us to not reassess: (1) whether any expired or existing contracts are or contain leases; (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. We also will use the practical expedient as described above to reflect the adoption of Topic 842 as of January 1, 2019 without recasting prior periods. We do not expect to recognize a material adjustment to retained earnings upon adoption. We are not expecting significant changes to our internal processes and controls over financial reporting with respect to the impact that the new lease standard will have on our lease administration and financial reporting activities. Presented below is our evaluation of Topic 842 from both the lessor and lessee perspectives. Lessee Accounting: We determine if an arrangement is a lease at inception. We lease real estate and equipment under operating leases. We lease 77 of our 89 branch locations as of December 31, 2018. Given the size of our operating lease portfolio, the new standard will have a material effect on our consolidated balance sheet as a result of recognizing new right-of-use (“ROU”) assets and lease liabilities for our existing operating leases. ROU assets represent our right to use the leased asset for the lease term and lease liabilities represent our obligation to make lease payments. Under Topic 842, operating lease ROU assets and liabilities are recognized at the lease commencement date (as defined in Topic 842) based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, upon adoption of Topic 842, we will use our estimated incremental borrowing rate at the commencement date to determine the present value of lease payments. The operating lease ROU assets will also include any lease payments made and exclude lease incentives. Our lease terms will include options to extend the lease that we are reasonably certain to exercise. Operating lease expense under Topic 842 will be recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, and we expect to elect the practical expedient allowing us to account for the lease and non-lease components as a single lease component under Topic 842 for all asset classes. The adoption of Topic 842 will have a material impact on our consolidated balance sheet due to the recognition of ROU assets and lease liabilities. We do not, however, expect our operating leases to have a material impact on our consolidated statements of income or consolidated statement of cash flows. See note 13 to the consolidated financial statements related to our operating leases and related rent expense for the years ended December 31, 2018, 2017 and 2016 and future lease commitments as of December 31, 2018, as determined pursuant to the lease accounting guidance (Topic 840) in effect for the periods presented. Our capital lease obligation addressed in note 11 to the consolidated financial statements is expected to be accounted for as a finance lease upon adoption of Topic 842, and we do not expect any significant impacts to our consolidated financial statements upon adoption related to this lease. Because of the transition method we will use to adopt Topic 842, Topic 842 will not be applied to periods prior to adoption and the adoption of Topic 842 will have no impact on our previously reported results. After the adoption of Topic 842, we will first report the ROU assets and lease liabilities for our operating leases as of March 31, 2019 in our Quarterly Report on Form 10-Q based on our lease portfolio as of that date. Lessor Accounting: Our equipment rental business involves rental contracts with customers whereby we are the lessor in the transaction and therefore, we believe that such transactions are subject to Topic 842. Based upon our analysis of Topic 842, we believe that certain ancillary fees that we charge our equipment rental customers will result in a different presentation within our consolidated statements of income upon adoption. Specifically, amounts we charge our customers for loss damage waiver fees, environmental fees and fuel recovery fees, upon adoption of Topic 842, are required to be included within our rental revenues segment rather than included in other revenues as we’ve historically presented. Likewise, we will present the related cost of goods sold for these items within our rental revenues cost of goods sold rather than included in other cost of goods sold as we’ve historically presented. While this change will not impact total consolidated revenues or total consolidated gross profit, the change will impact our rental revenues and other revenues gross margins compared to our historical gross margins. Because of the transition method we will use to adopt Topic 842, Topic 842 will not be applied to periods prior to adoption and the adoption of Topic 842 will have no impact on our previously reported results, but the comparability of our reported 2019 results compared to 2018 results will be impacted by the above-described statements of income presentation change. In June 2016, the FASB issued ASU 2016-13, “ Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other – Internal-Use Software Recent Accounting Pronouncements Adopted in 2018 In August 2016, the FASB issued ASU 2016-15, “ Classification of Certain Cash Receipts and Cash Payments” In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). Under this ASU and subsequently issued amendments, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflect the consideration we expect to be entitled to in exchange for those goods or services. Entities may use a full retrospective approach or report on the cumulative effect as of the date of adoption. We adopted this standard effective January 1, 2018 using the full retrospective transition method. While the adoption of the new standard did not have an impact on our reported net income for the periods presented in this Annual Report on Form 10-K, approximately $6.9 million and $6.8 million of revenues that were previously classified in Other Revenues have been reclassified to Parts Revenues for the years ended December 31, 2017 and 2016, respectively. These revenues relate to freight income associated with our parts transactions, and such income was not deemed to be a separate performance obligation under the new guidance. Accordingly, we also reclassified $5.4 million and $5.4 million of associated freight costs related to these parts transactions from Other Cost of Revenues to Parts Costs of Revenues for the years ended December 31, 2017 and 2016, respectively. We have recast our results for the prior years ended December 31, 2017 and 2016 as shown in the tables below (amounts in thousands) pursuant to the adoption of Topic 606 using the full retrospective transition method. Year Ended December 31, 2017 Statement of Income: As Previously Reported Adjustments Current Presentation Revenues: Equipment rentals $ 479,016 $ ─ $ 479,016 New equipment sales 203,301 ─ 203,301 Used equipment sales 107,329 ─ 107,329 Parts sales 107,384 6,869 114,253 Services revenues 62,873 ─ 62,873 Other 70,116 (6,869) 63,247 Total revenues 1,030,019 ─ 1,030,019 Cost of revenues: Rental depreciation 169,455 ─ 169,455 Rental expense 77,706 ─ 77,706 New equipment sales 180,702 ─ 180,702 Used equipment sales 74,132 ─ 74,132 Parts sales 77,713 5,422 83,135 Services revenues 21,111 ─ 21,111 Other 69,292 (5,422) 63,870 Total cost of revenues 670,111 ─ 670,111 Gross profit $ 359,908 $ ─ $ 359,908 Year Ended December 31, 2016 Statement of Income: As Previously Reported Adjustments Current Presentation Revenues: Equipment rentals $ 445,227 $ ─ $ 445,227 New equipment sales 196,688 ─ 196,688 Used equipment sales 96,910 ─ 96,910 Parts sales 109,147 6,842 115,989 Services revenues 64,673 ─ 64,673 Other 65,492 (6,842) 58,650 Total revenues 978,137 ─ 978,137 Cost of revenues: Rental depreciation 162,415 ─ 162,415 Rental expense 71,694 ─ 71,694 New equipment sales 175,556 ─ 175,556 Used equipment sales 66,738 ─ 66,738 Parts sales 78,966 5,361 84,327 Services revenues 21,839 ─ 21,839 Other 65,318 (5,361) 59,957 Total cost of revenues 642,526 ─ 642,526 Gross profit $ 335,611 $ ─ $ 335,611 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Revenue by Type and by Applicable Accounting Standard | The tables below summarize our revenues as presented in our consolidated statements of income for the years ended December 31, 2018, 2017 and 2016 by revenue type and by the applicable accounting standard (amounts in thousands). Year Ended December 31, 2018 2017 Topic 840 Topic 606 Total Topic 840 Topic 606 Total Rental revenues $ 590,858 $ 1,335 $ 592,193 $ 476,978 $ 2,038 $ 479,016 New equipment sales ─ 262,948 262,948 ─ 203,301 203,301 Used equipment sales ─ 125,125 125,125 ─ 107,329 107,329 Parts sales ─ 120,454 120,454 ─ 114,253 114,253 Service revenues ─ 63,488 63,488 ─ 62,873 62,873 Other 21,693 53,060 74,753 17,791 45,456 63,247 Total revenues $ 612,551 $ 626,410 $ 1,238,961 $ 494,769 $ 535,250 $ 1,030,019 Year Ended December 31, 2016 Topic 840 Topic 606 Total Rental revenues $ 443,148 $ 2,079 $ 445,227 New equipment sales ─ 196,688 196,688 Used equipment sales ─ 96,910 96,910 Parts sales ─ 115,989 115,989 Service revenues ─ 64,673 64,673 Other 16,199 42,451 58,650 Total revenues $ 459,347 $ 518,790 $ 978,137 |
Estimated Useful Lives of Property Plant and Equipment | Generally, we assign the following estimated useful lives to these categories: Category Estimated Useful Life Transportation equipment 5 years Buildings 39 years Office equipment 5 years Computer equipment 3 years Machinery and equipment 7 years |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for our reporting units for the years ended December 31, 2018 and 2017 were as follows (amounts in thousands): Eq. Rental Comp. 1 Eq. Rental Comp. 2 New Eq. Sales Used Eq. Sales Parts Sales Services Revenues Total Balance at December 31, 2016 $ ─ $ 18,700 $ ─ $ 6,137 $ 6,360 $ ─ $ 31,197 Increases (Decreases) ─ ─ ─ ─ ─ ─ ─ Balance at December 31, 2017 ─ 18,700 ─ 6,137 6,360 ─ 31,197 Increases (1) 34,297 23,836 10,434 2,324 2,550 1,205 74,646 Decreases ─ ─ ─ ─ ─ ─ ─ Balance at December 31, 2018 $ 34,297 $ 42,536 $ 10,434 $ 8,461 $ 8,910 $ 1,205 $105,843 (1) Increases are related to goodwill recognized in the CEC and Rental Inc. 2018 acquisitions. See footnote 3 for further information. |
Estimated Incremental Borrowing Rates for Similar Types of Borrowing Arrangements | The carrying amounts and fair values of our other financial instruments subject to fair value disclosures as of December 31, 2018 and 2017 are presented in the table below (amounts in thousands) and have been calculated based upon market quotes and present value calculations based on market rates. December 31, 2018 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 5.50% (Level 3) $ 23,666 $ 19,870 Senior unsecured notes due 2025 with interest computed at 5.625% (Level 2) 944,780 871,625 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 726 330 Letter of credit (Level 3) — 116 December 31, 2017 Carrying Amount Fair Value Manufacturer flooring plans payable with interest computed at 4.50% (Level 3) $ 22,002 $ 18,737 Senior unsecured notes due 2025 with interest computed at 5.625% (Level 3) 944,088 619,019 Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) 1,486 1,114 Letter of credit (Level 3) — 116 |
Summary of Computation of Basic and Diluted Net Income Per Common Share | The following table sets forth the computation of basic and diluted net income per common share for the years ended December 31, (amounts in thousands, except per share amounts): 2018 2017 2016 Basic net income per share: Net income $ 76,623 $ 109,658 $ 37,172 Weighted average number of common shares outstanding 35,677 35,516 35,393 Net income per common share — basic $ 2.15 $ 3.09 $ 1.05 Diluted net income per share: Net income $ 76,623 $ 109,658 $ 37,172 Weighted average number of common shares outstanding 35,677 35,516 35,393 Effect of dilutive securities: Effect of dilutive stock options — — — Effect of dilutive non-vested stock 226 183 87 Weighted average number of common shares outstanding — diluted 35,903 35,699 35,480 Net income per common share — diluted $ 2.13 $ 3.07 $ 1.05 Common shares excluded from the denominator as anti-dilutive: Stock options — — 4 Non-vested stock 43 — 3 |
Schedule of Non-Vested Stock Activity | The following table summarizes our non-vested stock activity for the years ended December 31, 2018 and 2017: Number of Shares Weighted Average Grant Date Fair Value Non-vested stock at January 1, 2017 400,801 $ 18.86 Granted 190,134 $ 22.94 Vested (131,807 ) $ 21.85 Forfeited (13,164 ) $ 19.50 Non-vested stock at December 31, 2017 445,964 $ 19.70 Granted 143,121 $ 37.10 Vested (181,194 ) $ 20.53 Forfeited (28,332 ) $ 19.61 Non-vested stock at December 31, 2018 379,559 $ 25.87 |
Schedule of Share Based Compensation Stock Options Activity | The following table represents stock option activity for the years ended December 31, 2018 and 2017: Number of Shares Weighted Average Exercise Price Weighted Average Contractual Life In Years Outstanding options at January 1, 2017 4,500 $ 19.27 0.5 Granted — — Exercised — — Canceled, forfeited or expired (4,500 ) 19.27 Outstanding options at December 31, 2017 — Granted — Exercised — Canceled, forfeited or expired — Outstanding options at December 31, 2018 — Options exercisable at December 31, 2018 — |
Recast of Our Results for Prior Year | Year Ended December 31, 2017 Statement of Income: As Previously Reported Adjustments Current Presentation Revenues: Equipment rentals $ 479,016 $ ─ $ 479,016 New equipment sales 203,301 ─ 203,301 Used equipment sales 107,329 ─ 107,329 Parts sales 107,384 6,869 114,253 Services revenues 62,873 ─ 62,873 Other 70,116 (6,869) 63,247 Total revenues 1,030,019 ─ 1,030,019 Cost of revenues: Rental depreciation 169,455 ─ 169,455 Rental expense 77,706 ─ 77,706 New equipment sales 180,702 ─ 180,702 Used equipment sales 74,132 ─ 74,132 Parts sales 77,713 5,422 83,135 Services revenues 21,111 ─ 21,111 Other 69,292 (5,422) 63,870 Total cost of revenues 670,111 ─ 670,111 Gross profit $ 359,908 $ ─ $ 359,908 Year Ended December 31, 2016 Statement of Income: As Previously Reported Adjustments Current Presentation Revenues: Equipment rentals $ 445,227 $ ─ $ 445,227 New equipment sales 196,688 ─ 196,688 Used equipment sales 96,910 ─ 96,910 Parts sales 109,147 6,842 115,989 Services revenues 64,673 ─ 64,673 Other 65,492 (6,842) 58,650 Total revenues 978,137 ─ 978,137 Cost of revenues: Rental depreciation 162,415 ─ 162,415 Rental expense 71,694 ─ 71,694 New equipment sales 175,556 ─ 175,556 Used equipment sales 66,738 ─ 66,738 Parts sales 78,966 5,361 84,327 Services revenues 21,839 ─ 21,839 Other 65,318 (5,361) 59,957 Total cost of revenues 642,526 ─ 642,526 Gross profit $ 335,611 $ ─ $ 335,611 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Acquisition [Line Items] | |
Unaudited Pro Forma Consolidated Statements of Income Information | The unaudited tables below present unaudited pro forma consolidated statements of income information for the year December 31, 2017 as if CEC and Rental Inc. were included in our consolidated results for the entire period presented. (amounts in thousands, except per share data) Year Ended December 31, 2017 H&E CEC Rental Inc. Total Total revenues $1,030,019 $36,790 $34,942 $1,101,751 Pretax income 59,344 3,043 7,267 69,654 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (1) — (3,575) (2,794) (6,369) Intangible asset amortization (2) — (2,420) (1,200) (3,620) Elimination of merger related costs 788 4,465 — 5,285 Interest expense (3) — — (1,609) (1,609) Elimination of historic interest expense (4) — 1,966 382 2,348 Pro forma pretax income 60,132 3,479 2,046 65,689 Pro forma income tax benefit (50,511) (2,922) (1,719) (55,179) Pro forma net income $ 110,643 $6,401 $3,765 $120,868 Pro forma net income per share – basic $ 3.12 $ 0.18 $ 0.11 $ 3.40 Pro forma net income per share - diluted $ 3.10 $ 0.18 $ 0.11 $ 3.39 (amounts in thousands, except per share data) Year Ended December 31, 2018 H&E(5) Rental Inc.(6) Total Total revenues $1,238,961 $7,408 $1,246,369 Pretax income 104,663 1,020 105,683 Pro forma adjustments to pretax income: Impact of fair value mark-ups/useful life changes on depreciation (1) ─ (749) (749) Intangible asset amortization (2) ─ (300) (300) Interest expense (3) ─ (480) (480) Elimination of historic interest expense (4) ─ 82 82 Pro forma pretax income (loss) 104,663 (427) 104,236 Pro forma income tax expense (benefit) 28,040 (114) 27,926 Pro forma net income (loss) $ 76,623 $ (313) $ 76,310 Pro forma net income (loss) per share – basic $ 2.15 $(0.01) $ 2.14 Pro forma net income (loss) per share - diluted $ 2.13 $(0.01) $ 2.13 (1) Depreciation of rental equipment and non-rental equipment were adjusted for the fair value markups, and the changes in useful lives and salvage values of the equipment acquired in the acquisitions. (2) Represents the amortization of the intangible assets acquired in the acquisitions. (3) A portion of the consideration paid for Rental Inc. was funded with borrowings from our Credit Facility. Interest expense was adjusted to reflect the additional debt resulting from such acquisition. (4) Represents the elimination of historic debt of CEC and Rental Inc. that is not part of the combined entity. (5) H&E represents consolidated operating results as presented in this Annual Report on Form 10-K for the year ended December 31, 2018 and includes actual results for CEC for the full twelve months ended December 31, 2018 and actual results for Rental Inc. for the period April 1, 2018 through December 31, 2018. (6) Represents Rental Inc. pro forma operating results for the three month period ended March 31, 2018. We completed the Rental Inc. acquisition effective April 1, 2018. |
CEC [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date. We do not expect any further changes to these assigned values. $’s in thousands Cash $ 1,244 Accounts receivable 7,583 Inventory 504 Prepaid expenses and other assets 324 Rental equipment 55,342 Property and equipment 2,700 Intangible assets (1) 21,500 Total identifiable assets acquired 89,197 Accounts payable (1,023) Accrued expenses payable and other liabilities (876) Total liabilities assumed (1,899) Net identifiable assets acquired 87,298 Goodwill (2) 45,092 Net assets acquired $ 132,390 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 21,000 10 Tradenames 300 1 Leasehold interests 200 10 $ 21,500 (2) We have allocated the $45.1 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $25,233 Rental Component 2 18,391 New Equipment 217 Used Equipment 632 Parts 379 Service 240 |
Rental Inc [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date. The amounts presented here are preliminary and are subject to change. However, we do not expect material changes to these assigned values. $’s in thousands Cash $ 260 Accounts receivable 2,873 Inventory 5,324 Prepaid expenses and other assets 47 Rental equipment 22,578 Property and equipment 1,935 Intangible assets (1) 10,200 Total identifiable assets acquired 43,217 Accounts payable (439) Manufacturer flooring plans payable (3,293) Accrued expenses payable and other liabilities (469) Total liabilities assumed (4,201) Net identifiable assets acquired 39,016 Goodwill (2) 29,554 Net assets acquired $ 68,570 (1) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments: Fair Value (amounts in thousands) Life (years) Customer relationships $ 10,000 10 Tradenames 200 1 $ 10,200 (2) We have allocated the $29.6 million goodwill among our six goodwill reporting units as follows (amounts in thousands): Rental Component 1 $9,064 Rental Component 2 5,445 New Equipment 10,217 Used Equipment 1,692 Parts 2,171 Service 964 |
Receivables (Tables)
Receivables (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Summary of Receivables | Receivables consisted of the following at December 31, (amounts in thousands): 2018 2017 Trade receivables $ 194,601 $ 172,522 Unbilled rental revenue 8,833 6,291 Income tax receivables 2,181 997 Other 35 45 205,650 179,855 Less allowance for doubtful accounts (4,094 ) (3,774 ) Total receivables, net $ 201,556 $ 176,081 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories consisted of the following at December 31, (amounts in thousands): 2018 2017 New equipment $ 84,603 $ 55,704 Used equipment 1,980 2,421 Parts, supplies and other 18,015 16,879 Total inventories, net $ 104,598 $ 75,004 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property Plant And Equipment [Abstract] | |
Summary of Net Property and Equipment | Net property and equipment consisted of the following at December 31, (amounts in thousands): 2018 2017 Land $ 7,597 $ 7,165 Transportation equipment 106,011 93,550 Building and leasehold improvements 63,060 55,523 Office and computer equipment 51,758 53,256 Machinery and equipment 17,811 15,983 Property under capital leases 2,417 3,217 Construction in progress 9,129 4,595 257,783 233,289 Less accumulated depreciation and amortization (142,662 ) (131,500 ) Total net property and equipment $ 115,121 $ 101,789 |
Manufacturer Flooring Plans P_2
Manufacturer Flooring Plans Payable (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Text Block [Abstract] | |
Maturities of Manufacturer Flooring Plans Payable | Maturities (based on original financing terms) of the manufacturer flooring plans payable as of December 31, 2018 for each of the next three years ending December 31 are as follows (amounts in thousands): 2019 $ 12,605 2020 10,822 2021 239 Thereafter — Total $ 23,666 |
Accrued Expenses Payable and _2
Accrued Expenses Payable and Other Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Payables And Accruals [Abstract] | |
Summary of Accrued Expenses Payable and Other Liabilities | Accrued expenses payable and other liabilities consisted of the following at December 31, (amounts in thousands): 2018 2017 Payroll and related liabilities $ 24,864 $ 20,429 Sales, use and property taxes 10,069 9,635 Accrued interest 18,771 19,134 Accrued insurance 4,328 4,211 Deferred revenue 5,973 6,631 Other 9,366 5,055 Total accrued expenses payable and other liabilities $ 73,371 $ 65,095 |
Senior Unsecured Notes (Tables)
Senior Unsecured Notes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Senior Unsecured Notes [Member] | |
Debt Instrument [Line Items] | |
Reconciliation of Senior Unsecured Notes to Condensed Consolidated Balance Sheets | The following table reconciles our Senior Unsecured Notes to our Consolidated Balance Sheets (amounts in thousands): Balance at December 31, 2016 $ 627,711 Accretion of discount on Old Notes through August 24, 2017 683 Amortization of note premium on Old Notes through August 24, 2017 (574 ) Amortization of deferred financing costs on Old Notes through August 24, 2017 153 Aggregate principal amount paid on Old Notes (630,000 ) Writeoff of unaccreted discount on Old Notes 5,294 Writeoff of unamortized premium on Old Notes (4,452 ) Writeoff of deferred financing costs on Old Notes 1,185 Aggregate principal amount issued on New Notes 950,000 Notes discount and deferred transaction costs on New Notes (14,684 ) Note premium on New Notes 8,500 Accretion of discount on New Notes from August 24, 2017 through December 31, 2017 542 Amortization of note premium on New Notes from August 24, 2017 through December 31, 2017 (375 ) Amortization of deferred financing costs on New Notes from August 24, 2017 through December 31, 2017 105 Balance at December 31, 2017 $ 944,088 Accretion of discount through December 31, 2018 1,539 Amortization of note premium through December 31, 2018 (1,062 ) Additional deferred financing costs on New Notes (97 ) Amortization of deferred financing costs through December 31, 2018 312 Balance at December 31, 2018 $ 944,780 |
Capital Lease Obligations (Tabl
Capital Lease Obligations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Leases [Abstract] | |
Future Minimum Capital Lease Payments | Future minimum capital lease payments, in the aggregate, existing at December 31, 2018 for each of the next five years ending December 31 and thereafter are as follows (amounts in thousands): 2019 $ 252 2020 252 2021 252 2022 42 Total minimum lease payments 798 Less: amount representing interest (72 ) Present value of minimum lease payments $ 726 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax Provision (Benefit) | Our income tax provision (benefit) for the years ended December 31, 2018, 2017 and 2016, consists of the following (amounts in thousands): Current Deferred Total Year ended December 31, 2018: U.S. Federal $ (1,522 ) $ 23,126 $ 21,604 State 2,868 3,568 6,436 $ 1,346 $ 26,694 $ 28,040 Year ended December 31, 2017: U.S. Federal $ — $ (54,241 ) $ (54,241 ) State 220 3,707 3,927 $ 220 $ (50,534 ) $ (50,314 ) Year ended December 31, 2016 U.S. Federal $ — $ 21,516 $ 21,516 State 280 62 342 $ 280 $ 21,578 $ 21,858 |
Deferred Income Tax Assets and Liabilities | Significant components of our deferred income tax assets and liabilities as of December 31 are as follows (amounts in thousands): 2018 2017 Deferred tax assets: Accounts receivable $ 1,010 $ 929 Inventories 93 239 Net operating losses 86,859 18,165 AMT and tax credits 2,110 3,565 Sec 263A costs 752 544 Accrued liabilities 2,869 2,767 Deferred compensation 1,561 1,132 Accrued interest 387 365 Stock-based compensation 146 181 Goodwill and intangible assets 346 — Other assets 415 531 96,548 28,418 Valuation allowance (609 ) (732 ) 95,939 27,686 Deferred tax liabilities: Property and equipment (245,198 ) (152,235 ) Investments (1,076 ) (1,066 ) Goodwill and intangible assets (2,778 ) (804 ) (249,052 ) (154,105 ) Net deferred tax liabilities $ (153,113 ) $ (126,419 ) |
Actual Income Tax Expense (Benefit) | The reconciliation between income taxes computed using the statutory federal income tax rate (21% for the year ended December 31, 2018 and 35% for the years ended December 31, 2017 and 2016) to the actual income tax expense (benefit) is below for the years ended December 31 (amounts in thousands): 2018 2017 2016 Computed tax at statutory rates $ 21,979 $ 20,770 $ 20,660 Permanent items - other 1,021 911 904 Permanent items - excess of tax deductible goodwill — (2,130 ) — State income tax, net of federal tax effect 5,246 2,563 2,115 Change in valuation allowance (123 ) 397 207 Change in uncertain tax positions (83 ) (5,960 ) 66 Other - change in deferred state rate — — (2,094 ) Impact of the Act federal rate change — (66,865 ) — $ 28,040 $ (50,314 ) $ 21,858 |
Amounts of Gross Unrecognized Tax Benefits | A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits is as follows (in thousands): 2018 2017 Gross unrecognized tax benefits at January 1 $ 106 $ 6,119 Increases in tax positions taken in prior years — 22 Decreases in tax positions taken in prior years (106 ) (22 ) Lapse in statute of limitations — (6,013 ) Gross unrecognized tax benefits at December 31 $ — $ 106 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future Minimum Operating Lease Payments | Future minimum operating lease payments existing at December 31, 2018 for each of the next five years ending December 31 and thereafter are as follows (amounts in thousands): 2019 $ 21,775 2020 21,965 2021 21,176 2022 19,854 2023 17,145 Thereafter 86,398 $ 188,313 |
Summarized Quarterly Financia_2
Summarized Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Unaudited Quarterly Financial Results of Operations | The following is a summary of our unaudited quarterly financial results of operations for the years ended December 31, 2018 and 2017 (amounts in thousands, except per share amounts): First Quarter Second Quarter Third Quarter Fourth Quarter 2018: Total revenues $ 260,482 $ 310,364 $ 322,141 $ 345,974 Income from operations 27,326 43,103 45,318 50,899 Income before provision for income taxes 13,068 27,869 28,971 34,755 Net income 9,478 20,771 21,314 25,060 Basic net income per common share (1) 0.27 0.58 0.60 0.70 Diluted net income per common share (1) 0.26 0.58 0.59 0.70 First Quarter Second Quarter Third Quarter Fourth Quarter 2017: Total revenues $ 226,828 $ 249,363 $ 259,162 $ 294,666 Income from operations (2) 21,325 28,668 47,654 40,268 Income before provision for income taxes (3) 8,530 15,668 7,577 27,569 Net income (4) 5,390 9,878 8,462 85,928 Basic net income per common share (1) 0.15 0.28 0.24 2.41 Diluted net income per common share (1) 0.15 0.28 0.24 2.40 (1) Because of the method used in calculating per share data, the summation of quarterly per share data may not necessarily total to the per share data computed for the entire year due to rounding. (2) (3) In addition to the amounts described in (2) above, the third quarter of 2017 includes a $25.4 million loss on the early extinguishment of debt. (4) During the third quarter of 2017, the statute of limitations lapsed for approximately $6.0 million of unrecognized tax benefits, for which we recognized a $5.9 million reduction in income tax expense for the third quarter of 2017. During the fourth quarter of 2017 and as further described in note 12 above, we recorded a one-time decrease in income tax expense of approximately $66.9 million related to the impact from the enactment of the Act legislation. |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Information about Reportable Segments | . The following table presents information about our reportable segments (amounts in thousands): Years Ended December 31, 2018 2017 2016 Segment Revenues: Equipment rentals $ 592,193 $ 479,016 $ 445,227 New equipment sales 262,948 203,301 196,688 Used equipment sales 125,125 107,329 96,910 Parts sales 120,454 114,253 115,989 Services revenues 63,488 62,873 64,673 Total segmented revenues 1,164,208 966,772 919,487 Non-Segmented revenues 74,753 63,247 58,650 Total revenues $ 1,238,961 $ 1,030,019 $ 978,137 Segment Gross Profit: Equipment rentals $ 294,220 $ 231,855 $ 211,118 New equipment sales 30,891 22,599 21,132 Used equipment sales 39,073 33,197 30,172 Parts sales 32,191 31,118 31,662 Services revenues 42,160 41,762 42,834 Total gross profit from segmented revenues 438,535 360,531 336,918 Non-Segmented gross profit (loss) (1 ) (623 ) (1,307 ) Total gross profit $ 438,534 $ 359,908 $ 335,611 December 31, 2018 2017 Segment identified assets: Equipment sales $ 86,583 $ 58,125 Equipment rentals 1,141,498 904,824 Parts and service 18,015 16,879 Total segment identified assets 1,246,096 979,828 Non-Segmented identified assets 481,085 487,889 Total assets $ 1,727,181 $ 1,467,717 |
Consolidating Financial Infor_2
Consolidating Financial Information of Guarantor Subsidiaries (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Condensed Consolidating Balance Sheet | CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2018 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 16,677 $ — $ — $ 16,677 Receivables, net 166,393 35,163 — 201,556 Inventories, net 94,483 10,115 — 104,598 Prepaid expenses and other assets 10,382 126 — 10,508 Rental equipment, net 983,281 158,217 — 1,141,498 Property and equipment, net 98,251 16,870 — 115,121 Deferred financing costs, net 3,000 — — 3,000 Investment in guarantor subsidiaries 246,309 — (246,309 ) — Intangible assets, net 28,380 — — 28,380 Goodwill 76,317 29,526 — 105,843 Total assets $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 Liabilities and Stockholders’ Equity: Amount due on senior secured credit facility $ 170,761 $ — $ — $ 170,761 Accounts payable 95,866 5,974 — 101,840 Manufacturer flooring plans payable 23,178 488 — 23,666 Accrued expenses payable and other liabilities 76,798 (3,427 ) — 73,371 Dividends payable 185 (53 ) — 132 Senior unsecured notes 944,780 — — 944,780 Capital leases payable — 726 — 726 Deferred income taxes 153,113 — — 153,113 Deferred compensation payable 1,989 — — 1,989 Total liabilities 1,466,670 3,708 — 1,470,378 Stockholders’ equity 256,803 246,309 (246,309 ) 256,803 Total liabilities and stockholders’ equity $ 1,723,473 $ 250,017 $ (246,309 ) $ 1,727,181 CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2017 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Assets: Cash $ 165,878 $ — $ — $ 165,878 Receivables, net 138,657 37,424 — 176,081 Inventories, net 63,828 11,176 — 75,004 Prepaid expenses and other assets 9,030 142 — 9,172 Rental equipment, net 760,972 143,852 — 904,824 Property and equipment, net 89,952 11,837 — 101,789 Deferred financing costs, net 3,772 — — 3,772 Investment in guarantor subsidiaries 222,217 — (222,217 ) — Goodwill 1,671 29,526 — 31,197 Total assets $ 1,455,977 $ 233,957 $ (222,217 ) $ 1,467,717 Liabilities and Stockholders’ Equity: Amount due on senior secured credit facility $ — $ — $ — $ — Accounts payable 78,811 10,970 — 89,781 Manufacturer flooring plans payable 20,300 1,702 — 22,002 Accrued expenses payable and other liabilities 67,466 (2,371 ) — 65,095 Dividends payable 197 (47 ) — 150 Senior unsecured notes 944,088 — — 944,088 Capital leases payable — 1,486 — 1,486 Deferred income taxes 126,419 — — 126,419 Deferred compensation payable 1,903 — — 1,903 Total liabilities 1,239,184 11,740 — 1,250,924 Stockholders’ equity 216,793 222,217 (222,217 ) 216,793 Total liabilities and stockholders’ equity $ 1,455,977 $ 233,957 $ (222,217 ) $ 1,467,717 |
Condensed Consolidating Statement of Income | CONDENSED CONSOLIDATING STATEMENT OF INCOME Year Ended December 31, 2018 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 506,620 $ 85,573 $ — $ 592,193 New equipment sales 207,564 55,384 — 262,948 Used equipment sales 102,005 23,120 — 125,125 Parts sales 103,586 16,868 — 120,454 Services revenues 53,534 9,954 — 63,488 Other 62,633 12,120 — 74,753 Total revenues 1,035,942 203,019 — 1,238,961 Cost of revenues: Rental depreciation 178,371 30,082 — 208,453 Rental expense 76,487 13,033 — 89,520 New equipment sales 183,164 48,893 — 232,057 Used equipment sales 69,960 16,092 — 86,052 Parts sales 76,425 11,838 — 88,263 Services revenues 18,100 3,228 — 21,328 Other 62,745 12,009 — 74,754 Total cost of revenues 665,252 135,175 — 800,427 Gross profit (loss): Equipment rentals 251,762 42,458 — 294,220 New equipment sales 24,400 6,491 — 30,891 Used equipment sales 32,045 7,028 — 39,073 Parts sales 27,161 5,030 — 32,191 Services revenues 35,434 6,726 — 42,160 Other (112 ) 111 — (1 ) Gross profit 370,690 67,844 — 438,534 Selling, general and administrative expenses 232,892 45,406 — 278,298 Equity in earnings of guarantor subsidiaries 13,247 — (13,247 ) — Merger costs 708 — — 708 Gain from sales of property and equipment, net 6,475 643 — 7,118 Income from operations 156,812 23,081 (13,247 ) 166,646 Other income (expense): Interest expense (53,681 ) (10,026 ) — (63,707 ) Other, net 1,532 192 — 1,724 Total other expense, net (52,149 ) (9,834 ) — (61,983 ) Income before provision for income taxes 104,663 13,247 (13,247 ) 104,663 Provision for income taxes 28,040 — — 28,040 Net income $ 76,623 $ 13,247 $ (13,247 ) $ 76,623 CONDENSED CONSOLIDATING STATEMENT OF INCOME Year Ended December 31, 2017 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 395,275 $ 83,741 $ — $ 479,016 New equipment sales 166,730 36,571 — 203,301 Used equipment sales 84,741 22,588 — 107,329 Parts sales 97,852 16,401 — 114,253 Services revenues 52,807 10,066 — 62,873 Other 51,627 11,620 — 63,247 Total revenues 849,032 180,987 — 1,030,019 Cost of revenues: Rental depreciation 140,489 28,966 — 169,455 Rental expense 64,598 13,108 — 77,706 New equipment sales 148,163 32,539 — 180,702 Used equipment sales 59,481 14,651 — 74,132 Parts sales 71,603 11,532 — 83,135 Services revenues 17,851 3,260 — 21,111 Other 52,068 11,802 — 63,870 Total cost of revenues 554,253 115,858 — 670,111 Gross profit (loss): Equipment rentals 190,188 41,667 — 231,855 New equipment sales 18,567 4,032 — 22,599 Used equipment sales 25,260 7,937 — 33,197 Parts sales 26,249 4,869 — 31,118 Services revenues 34,956 6,806 — 41,762 Other (441 ) (182 ) — (623 ) Gross profit 294,779 65,129 — 359,908 Selling, general and administrative expenses 190,392 42,392 — 232,784 Equity in earnings of guarantor subsidiaries 16,136 — (16,136 ) — Merger breakup fees, net of merger costs (5,782 ) — — (5,782 ) Gain from sales of property and equipment, net 2,435 2,574 — 5,009 Income from operations 128,740 25,311 (16,136 ) 137,915 Other income (expense): Interest expense (45,480 ) (9,478 ) — (54,958 ) Loss on early extinguishment of debt (25,363 ) — — (25,363 ) Other, net 1,447 303 — 1,750 Total other expense, net (69,396 ) (9,175 ) — (78,571 ) Income before benefit for income taxes 59,344 16,136 (16,136 ) 59,344 Benefit for income taxes (50,314 ) — — (50,314 ) Net income $ 109,658 $ 16,136 $ (16,136 ) $ 109,658 CONDENSED CONSOLIDATING STATEMENT OF INCOME Year Ended December 31, 2016 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Revenues: Equipment rentals $ 364,654 $ 80,573 $ — $ 445,227 New equipment sales 158,291 38,397 — 196,688 Used equipment sales 78,956 17,954 — 96,910 Parts sales 100,920 15,069 — 115,989 Services revenues 55,391 9,282 — 64,673 Other 47,461 11,189 — 58,650 Total revenues 805,673 172,464 — 978,137 Cost of revenues: Rental depreciation 134,484 27,931 — 162,415 Rental expense 59,263 12,431 — 71,694 New equipment sales 140,948 34,608 — 175,556 Used equipment sales 55,075 11,663 — 66,738 Parts sales 73,587 10,740 — 84,327 Services revenues 18,963 2,876 — 21,839 Other 48,273 11,684 — 59,957 Total cost of revenues 530,593 111,933 — 642,526 Gross profit (loss): Equipment rentals 170,907 40,211 — 211,118 New equipment sales 17,343 3,789 — 21,132 Used equipment sales 23,881 6,291 — 30,172 Parts sales 27,333 4,329 — 31,662 Services revenues 36,428 6,406 — 42,834 Other (812 ) (495 ) — (1,307 ) Gross profit 275,080 60,531 — 335,611 Selling, general and administrative expenses 187,369 40,760 — 228,129 Equity in earnings of guarantor subsidiaries 11,416 — (11,416 ) — Gain from sales of property and equipment, net 2,789 496 — 3,285 Income from operations 101,916 20,267 (11,416 ) 110,767 Other income (expense): Interest expense (44,503 ) (9,101 ) — (53,604 ) Other, net 1,617 250 — 1,867 Total other expense, net (42,886 ) (8,851 ) — (51,737 ) Income before provision for income taxes 59,030 11,416 (11,416 ) 59,030 Provision for income taxes 21,858 — — 21,858 Net income $ 37,172 $ 11,416 $ (11,416 ) $ 37,172 |
Condensed Consolidating Statement of Cash Flows | CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Year Ended December 31, 2018 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 76,623 $ 13,247 $ (13,247 ) $ 76,623 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 21,570 3,023 — 24,593 Depreciation on rental equipment 178,371 30,082 — 208,453 Amortization of intangible assets 3,320 — — 3,320 Amortization of deferred financing costs 1,083 — — 1,083 Accretion of note discount, net of premium amortization 477 — — 477 Provision for losses on accounts receivable 2,065 676 — 2,741 Provision for inventory obsolescence 122 — — 122 Change in deferred income taxes 26,695 — — 26,695 Stock-based compensation expense 4,214 — — 4,214 Gain from sales of property and equipment, net (6,475 ) (643 ) — (7,118 ) Gain from sales of rental equipment, net (31,595 ) (6,757 ) — (38,352 ) Equity in earnings of guarantor subsidiaries (13,247 ) — 13,247 — Changes in operating assets and liabilities, net of acquisitions: Receivables (19,346 ) 1,585 — (17,761 ) Inventories (45,349 ) (2,881 ) — (48,230 ) Prepaid expenses and other assets (981 ) 16 — (965 ) Accounts payable 11,990 (4,996 ) — 6,994 Manufacturer flooring plans payable 2,878 (1,214 ) — 1,664 Accrued expenses payable and other liabilities 4,176 (1,604 ) — 2,572 Deferred compensation payable 86 — — 86 Net cash provided by operating activities 216,677 30,534 — 247,211 Cash flows from investing activities: Acquisition of business, net of cash acquired (196,027 ) — — (196,027 ) Purchases of property and equipment (26,903 ) (8,057 ) — (34,960 ) Purchases of rental equipment (362,780 ) (53,820 ) — (416,600 ) Proceeds from sales of property and equipment 8,617 644 — 9,261 Proceeds from sales of rental equipment 92,014 20,072 — 112,086 Investment in subsidiaries (10,845 ) — 10,845 — Net cash used in investing activities (495,924 ) (41,161 ) 10,845 (526,240 ) Cash flows from financing activities: Purchases of treasury stock (1,350 ) — — (1,350 ) Borrowings on senior secured credit facility 1,436,849 — — 1,436,849 Payments on senior secured credit facility (1,266,088 ) — — (1,266,088 ) Dividends paid (39,268 ) (6 ) — (39,274 ) Payments of deferred financing costs (97 ) — — (97 ) Payments of capital lease obligations — (212 ) — (212 ) Capital contributions — 10,845 (10,845 ) — Net cash provided by financing activities 130,046 10,627 (10,845 ) 129,828 Net decrease in cash (149,201 ) — — (149,201 ) Cash, beginning of year 165,878 — — 165,878 Cash, end of year $ 16,677 $ — $ — $ 16,677 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Year Ended December 31, 2017 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 109,658 $ 16,136 $ (16,136 ) $ 109,658 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 20,742 3,048 — 23,790 Depreciation on rental equipment 140,489 28,966 — 169,455 Amortization of deferred financing costs 1,046 — — 1,046 Accretion of note discount, net of premium amortization 274 — — 274 Provision for losses on accounts receivable 3,148 784 — 3,932 Provision for inventory obsolescence 161 — — 161 Change in deferred income taxes (50,535 ) — — (50,535 ) Stock-based compensation expense 3,526 — — 3,526 Loss on early extinguishment of debt 25,363 — — 25,363 Gain from sales of property and equipment, net (2,435 ) (2,574 ) — (5,009 ) Gain from sales of rental equipment, net (24,063 ) (7,819 ) — (31,882 ) Equity in earnings of guarantor subsidiaries (16,136 ) — 16,136 — Changes in operating assets and liabilities: Receivables (29,083 ) (10,929 ) — (40,012 ) Inventories (23,221 ) (8,550 ) — (31,771 ) Prepaid expenses and other assets (1,687 ) 28 — (1,659 ) Accounts payable 42,623 7,726 — 50,349 Manufacturer flooring plans payable (10,599 ) 1,821 — (8,778 ) Accrued expenses payable and other liabilities 8,660 (430 ) — 8,230 Deferred compensation payable 61 — — 61 Net cash provided by operating activities 197,992 28,207 — 226,199 Cash flows from investing activities: Purchases of property and equipment (17,852 ) (4,663 ) — (22,515 ) Purchases of rental equipment (198,988 ) (35,221 ) — (234,209 ) Proceeds from sales of property and equipment 3,528 3,978 — 7,506 Proceeds from sales of rental equipment 74,090 22,053 — 96,143 Investment in subsidiaries 14,128 — (14,128 ) — Net cash used in investing activities (125,094 ) (13,853 ) (14,128 ) (153,075 ) Cash flows from financing activities: Purchases of treasury stock (783 ) — — (783 ) Borrowings on senior secured credit facility 1,193,544 — — 1,193,544 Payments on senior secured credit facility (1,356,186 ) — — (1,356,186 ) Dividends paid (39,164 ) (8 ) — (39,172 ) Principal payments on senior unsecured notes due 2023 (630,000 ) — — (630,000 ) Costs paid to tender and redeem senior unsecured notes due 2022 (23,336 ) — — (23,336 ) Proceeds from issuance of senior unsecured notes due 2025 958,500 — — 958,500 Payments of deferred financing costs (17,278 ) — — (17,278 ) Payments of capital lease obligations — (218 ) — (218 ) Capital contributions — (14,128 ) 14,128 — Net cash provided by (used in) financing activities 85,297 (14,354 ) 14,128 85,071 Net increase in cash 158,195 — — 158,195 Cash, beginning of year 7,683 — — 7,683 Cash, end of year $ 165,878 $ — $ — $ 165,878 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Year Ended December 31, 2016 H&E Equipment Services Guarantor Subsidiaries Elimination Consolidated (Amounts in thousands) Cash flows from operating activities: Net income $ 37,172 $ 11,416 $ (11,416 ) $ 37,172 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization on property and equipment 24,194 3,088 — 27,282 Depreciation on rental equipment 134,484 27,931 — 162,415 Amortization of deferred financing costs 1,052 — — 1,052 Accretion of note discount, net of premium amortization 168 — — 168 Provision for losses on accounts receivable 2,616 521 — 3,137 Provision for inventory obsolescence 127 — — 127 Change in deferred income taxes 21,578 — — 21,578 Stock-based compensation expense 3,037 — — 3,037 Gain from sales of property and equipment, net (2,789 ) (496 ) — (3,285 ) Gain from sales of rental equipment, net (22,780 ) (6,223 ) — (29,003 ) Equity in earnings of guarantor subsidiaries (11,416 ) — 11,416 — Changes in operating assets and liabilities: Receivables 8,783 (4,629 ) — 4,154 Inventories 5,785 (1,518 ) — 4,267 Prepaid expenses and other assets 2,566 (25 ) — 2,541 Accounts payable (27,771 ) 426 — (27,345 ) Manufacturer flooring plans payable (31,534 ) (119 ) — (31,653 ) Accrued expenses payable and other liabilities 2,263 (596 ) — 1,667 Deferred compensation payable (332 ) — — (332 ) Net cash provided by operating activities 147,203 29,776 — 176,979 Cash flows from investing activities: Purchases of property and equipment (19,505 ) (3,390 ) — (22,895 ) Purchases of rental equipment (138,562 ) (41,147 ) — (179,709 ) Proceeds from sales of property and equipment 3,190 615 — 3,805 Proceeds from sales of rental equipment 67,282 17,107 — 84,389 Investment in subsidiaries 2,749 — (2,749 ) — Net cash used in investing activities (84,846 ) (26,815 ) (2,749 ) (114,410 ) Cash flows from financing activities: Purchases of treasury stock (561 ) — — (561 ) Borrowing on senior secured credit facility 966,146 — — 966,146 Payments on senior secured credit facility (988,361 ) — — (988,361 ) Dividends paid (39,057 ) (9 ) — (39,066 ) Payments of capital lease obligations — (203 ) — (203 ) Capital contributions — (2,749 ) 2,749 — Net cash used in financing activities (61,833 ) (2,961 ) 2,749 (62,045 ) Net increase in cash 524 — — 524 Cash, beginning of year 7,159 — — 7,159 Cash, end of year $ 7,683 $ — $ — $ 7,683 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Summary of Revenue by Type and by Applicable Accounting Standard (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||||||||||
Revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 |
Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 1,030,019 | 978,137 | |||||||||
Topic 840 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 612,551 | 494,769 | 459,347 | ||||||||
Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 626,410 | 535,250 | 518,790 | ||||||||
Topic 606 [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 1,030,019 | 978,137 | |||||||||
Equipment Rentals [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 592,193 | 479,016 | 445,227 | ||||||||
Equipment Rentals [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 479,016 | 445,227 | |||||||||
Equipment Rentals [Member] | Topic 840 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 590,858 | 476,978 | 443,148 | ||||||||
Equipment Rentals [Member] | Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 1,335 | 2,038 | 2,079 | ||||||||
Equipment Rentals [Member] | Topic 606 [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 479,016 | 445,227 | |||||||||
New Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 262,948 | 203,301 | 196,688 | ||||||||
New Equipment Sales [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 203,301 | 196,688 | |||||||||
New Equipment Sales [Member] | Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 262,948 | 203,301 | 196,688 | ||||||||
New Equipment Sales [Member] | Topic 606 [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 203,301 | 196,688 | |||||||||
Used Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 125,125 | 107,329 | 96,910 | ||||||||
Used Equipment Sales [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 107,329 | 96,910 | |||||||||
Used Equipment Sales [Member] | Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 125,125 | 107,329 | 96,910 | ||||||||
Used Equipment Sales [Member] | Topic 606 [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 107,329 | 96,910 | |||||||||
Parts Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 120,454 | 114,253 | 115,989 | ||||||||
Parts Sales [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 114,253 | 115,989 | |||||||||
Parts Sales [Member] | Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 120,454 | 114,253 | 115,989 | ||||||||
Parts Sales [Member] | Topic 606 [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 107,384 | 109,147 | |||||||||
Parts and Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 63,488 | ||||||||||
Parts and Services [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 62,873 | 64,673 | |||||||||
Parts and Services [Member] | Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 63,488 | 62,873 | 64,673 | ||||||||
Other [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 74,753 | 63,247 | 58,650 | ||||||||
Other [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 63,247 | 58,650 | |||||||||
Other [Member] | Topic 840 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 21,693 | 17,791 | 16,199 | ||||||||
Other [Member] | Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | $ 53,060 | 45,456 | 42,451 | ||||||||
Other [Member] | Topic 606 [Member] | Effect Before Topic 606 [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | $ 70,116 | $ 65,492 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Additional Information (Detail) | Oct. 01, 2018USD ($) | Oct. 02, 2017USD ($) | Oct. 01, 2016USD ($) | Dec. 31, 2018USD ($)BranchManufacturerLocationshares | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($)Branch | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)CustomerSegmentBranchManufacturerBusinessLocationshares | Dec. 31, 2017USD ($)CustomerBranchshares | Dec. 31, 2016USD ($)CustomerBranchshares |
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Customer accounted for more than 10% of revenue | Customer | 0 | 0 | 0 | |||||||||||
Bad debt expense as a percentage of total revenues | 0.20% | 0.40% | 0.30% | |||||||||||
Salvage value | 25.00% | 25.00% | ||||||||||||
Impairment loss related to property and equipment | $ 0 | $ 0 | $ 0 | |||||||||||
Number of operating segments | Segment | 6 | |||||||||||||
Goodwill impairment | $ 0 | $ 0 | $ 0 | |||||||||||
Number of branches closed | Branch | 1 | 1 | 1 | 1 | 0 | |||||||||
Workers' compensation, general liability and automobile liability | $ 4,800,000 | $ 4,600,000 | $ 4,800,000 | $ 4,600,000 | ||||||||||
Health insurance reserves | $ 1,300,000 | 1,200,000 | 1,300,000 | 1,200,000 | ||||||||||
Advertising costs | $ 500,000 | $ 500,000 | $ 1,000,000 | |||||||||||
Statutory federal income tax rate | 21.00% | 35.00% | 35.00% | |||||||||||
Recognized income tax provisions | 50.00% | |||||||||||||
No. of manufacturers | Manufacturer | 5 | 5 | ||||||||||||
Issue of shares of non-vested period | 3 years | |||||||||||||
Unrecognized compensation expense related to non-vested stock | $ 5,000,000 | $ 5,000,000 | ||||||||||||
Expected non-vested stock recognized over a weighted-average period | 1 year 10 months 24 days | |||||||||||||
Share compensation expense | $ 4,200,000 | $ 3,500,000 | $ 3,000,000 | |||||||||||
Stock options, granted | shares | 0 | 0 | 0 | |||||||||||
Unrecognized compensation expense related to stock option awards | $ 0 | $ 0 | ||||||||||||
Number of reportable segment | Segment | 5 | |||||||||||||
Number of principal activities | Business | 5 | |||||||||||||
Number of branch locations | Location | 77 | 77 | ||||||||||||
Operating leases include real estate and equipment, number of branch location located | Location | 89 | 89 | ||||||||||||
Revenues | $ 345,974,000 | $ 322,141,000 | $ 310,364,000 | $ 260,482,000 | $ 294,666,000 | $ 259,162,000 | $ 249,363,000 | $ 226,828,000 | $ 1,238,961,000 | $ 1,030,019,000 | $ 978,137,000 | |||
Freight costs related to parts transactions | 800,427,000 | 670,111,000 | 642,526,000 | |||||||||||
Accounting Standards Update 2014-09 [Member] | Adjustments [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Revenues | $ 6,900,000 | $ 6,800,000 | ||||||||||||
Type of Revenue [Extensible List] | hees:PartsMember | hees:PartsMember | ||||||||||||
Freight costs related to parts transactions | $ 5,400,000 | $ 5,400,000 | ||||||||||||
Type of Cost, Good or Service [Extensible List] | hees:PartsMember | hees:PartsMember | ||||||||||||
Stock Options [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Share compensation expense | $ 0 | $ 0 | $ 0 | |||||||||||
2016 Stock-Based Incentive Compensation Plan [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Stock-Based incentive compensation plan | shares | 1,734,986 | 1,734,986 | ||||||||||||
Fair Value [Member] | Level 1 [Member] | Senior Unsecured Notes Due 2022 [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Senior unsecured notes, due year | 2,025 | |||||||||||||
Fair Value [Member] | Level 3 [Member] | Senior Unsecured Notes Due 2025 [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Senior unsecured notes, due year | 2,025 | |||||||||||||
Cranes and Aerial Work Platform [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Estimated useful life | 10 years | |||||||||||||
Earthmoving Equipment [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Estimated useful life | 5 years | |||||||||||||
Industrial Lift Trucks [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Estimated useful life | 7 years | |||||||||||||
Attachments and Other Equipment [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Estimated useful life | 3 years | |||||||||||||
Customer Concentration Risk [Member] | Revenues [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Percentage of revenue/purchase | 1.20% | |||||||||||||
Rental and Sales Equipment Manufacturers [Member] | Property, Plant and Equipment [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Percentage of revenue/purchase | 54.00% | |||||||||||||
Maximum [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Lease Term | 12 months | |||||||||||||
Maximum [Member] | Customer Concentration Risk [Member] | Revenues [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Percentage of revenue/purchase | 1.00% | 1.00% | ||||||||||||
Minimum [Member] | ||||||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||||||
Restricted common shares, percentage | 1.00% | 1.00% | 1.00% |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Estimated Useful Lives of Property Plant and Equipment (Detail) | 12 Months Ended |
Dec. 31, 2018 | |
Transportation Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 39 years |
Office Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Computer Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 3 years |
Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 7 years |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill [Line Items] | ||
Beginning balance | $ 31,197 | $ 31,197 |
Increases (Decreases) | 0 | |
Ending balance | 105,843 | 31,197 |
CEC and Rental Inc [Member] | ||
Goodwill [Line Items] | ||
Increases (Decreases) | 74,646 | |
Equipment Rental Component 1 [Member] | ||
Goodwill [Line Items] | ||
Ending balance | 34,297 | |
Equipment Rental Component 1 [Member] | CEC and Rental Inc [Member] | ||
Goodwill [Line Items] | ||
Increases (Decreases) | 34,297 | |
Equipment Rental Component 2 [Member] | ||
Goodwill [Line Items] | ||
Beginning balance | 18,700 | 18,700 |
Increases (Decreases) | 0 | |
Ending balance | 42,536 | 18,700 |
Equipment Rental Component 2 [Member] | CEC and Rental Inc [Member] | ||
Goodwill [Line Items] | ||
Increases (Decreases) | 23,836 | |
New Equipment Sales [Member] | ||
Goodwill [Line Items] | ||
Ending balance | 10,434 | |
New Equipment Sales [Member] | CEC and Rental Inc [Member] | ||
Goodwill [Line Items] | ||
Increases (Decreases) | 10,434 | |
Used Equipment Sales [Member] | ||
Goodwill [Line Items] | ||
Beginning balance | 6,137 | 6,137 |
Increases (Decreases) | 0 | |
Ending balance | 8,461 | 6,137 |
Used Equipment Sales [Member] | CEC and Rental Inc [Member] | ||
Goodwill [Line Items] | ||
Increases (Decreases) | 2,324 | |
Parts Sales [Member] | ||
Goodwill [Line Items] | ||
Beginning balance | 6,360 | 6,360 |
Increases (Decreases) | 0 | |
Ending balance | 8,910 | $ 6,360 |
Parts Sales [Member] | CEC and Rental Inc [Member] | ||
Goodwill [Line Items] | ||
Increases (Decreases) | 2,550 | |
Parts and Services [Member] | ||
Goodwill [Line Items] | ||
Ending balance | 1,205 | |
Parts and Services [Member] | CEC and Rental Inc [Member] | ||
Goodwill [Line Items] | ||
Increases (Decreases) | $ 1,205 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Estimated Incremental Borrowing Rates for Similar Types of Borrowing Arrangements (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Level 3 [Member] | Carrying Amount [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable with interest computed at 5.50% and 4.50%, respectively (Level 3) | $ 23,666 | $ 22,002 |
Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) | 726 | 1,486 |
Level 3 [Member] | Carrying Amount [Member] | Senior Unsecured Notes Due 2025 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes due 2025 with interest computed at (5.625%) (Level 2) and (Level 3) | 944,088 | |
Level 3 [Member] | Fair Value [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable with interest computed at 5.50% and 4.50%, respectively (Level 3) | 19,870 | 18,737 |
Capital leases payable with interest computed at 5.929% to 9.55% (Level 3) | 330 | 1,114 |
Letter of credit (Level 3) | 116 | 116 |
Level 3 [Member] | Fair Value [Member] | Senior Unsecured Notes Due 2025 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes due 2025 with interest computed at (5.625%) (Level 2) and (Level 3) | $ 619,019 | |
Level 2 [Member] | Carrying Amount [Member] | Senior Unsecured Notes Due 2025 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes due 2025 with interest computed at (5.625%) (Level 2) and (Level 3) | 944,780 | |
Level 2 [Member] | Fair Value [Member] | Senior Unsecured Notes Due 2025 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes due 2025 with interest computed at (5.625%) (Level 2) and (Level 3) | $ 871,625 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Estimated Incremental Borrowing Rates for Similar Types of Borrowing Arrangements (Parenthetical) (Detail) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Carrying Amount [Member] | Level 3 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable, interest rate | 5.50% | 4.50% |
Capital lease payable, interest rate, minimum | 5.929% | 5.929% |
Capital lease payable interest rate, maximum | 9.55% | 9.55% |
Fair Value [Member] | Level 3 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Manufacturer flooring plans payable, interest rate | 5.50% | 4.50% |
Capital lease payable, interest rate, minimum | 5.929% | 5.929% |
Capital lease payable interest rate, maximum | 9.55% | 9.55% |
Senior Unsecured Notes Due 2025 [Member] | Carrying Amount [Member] | Level 3 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes, due year | 2,025 | |
Senior unsecured notes, interest rate | 5.625% | |
Senior Unsecured Notes Due 2025 [Member] | Carrying Amount [Member] | Level 2 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes, due year | 2,025 | |
Senior unsecured notes, interest rate | 5.625% | |
Senior Unsecured Notes Due 2025 [Member] | Fair Value [Member] | Level 3 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes, due year | 2,025 | |
Senior unsecured notes, interest rate | 5.625% | |
Senior Unsecured Notes Due 2025 [Member] | Fair Value [Member] | Level 2 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Senior unsecured notes, due year | 2,025 | |
Senior unsecured notes, interest rate | 5.625% |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Summary of Computation of Basic and Diluted Net Income Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Basic net income per share: | |||||||||||
Net income | $ 25,060 | $ 21,314 | $ 20,771 | $ 9,478 | $ 85,928 | $ 8,462 | $ 9,878 | $ 5,390 | $ 76,623 | $ 109,658 | $ 37,172 |
Weighted average number of common shares outstanding | 35,677 | 35,516 | 35,393 | ||||||||
Net income per common share — basic | $ 0.70 | $ 0.60 | $ 0.58 | $ 0.27 | $ 2.41 | $ 0.24 | $ 0.28 | $ 0.15 | $ 2.15 | $ 3.09 | $ 1.05 |
Diluted net income per share: | |||||||||||
Net income | $ 25,060 | $ 21,314 | $ 20,771 | $ 9,478 | $ 85,928 | $ 8,462 | $ 9,878 | $ 5,390 | $ 76,623 | $ 109,658 | $ 37,172 |
Weighted average number of common shares outstanding | 35,677 | 35,516 | 35,393 | ||||||||
Effect of dilutive securities: | |||||||||||
Weighted average number of common shares outstanding — diluted | 35,903 | 35,699 | 35,480 | ||||||||
Net income per common share — diluted | $ 0.70 | $ 0.59 | $ 0.58 | $ 0.26 | $ 2.40 | $ 0.24 | $ 0.28 | $ 0.15 | $ 2.13 | $ 3.07 | $ 1.05 |
Stock Options [Member] | |||||||||||
Common shares excluded from the denominator as anti-dilutive: | |||||||||||
Common shares excluded from the denominator as anti-dilutive | 4 | ||||||||||
Non-vested restricted stock [Member] | |||||||||||
Effect of dilutive securities: | |||||||||||
Effect of dilutive stock options and non-vested stock | 226 | 183 | 87 | ||||||||
Common shares excluded from the denominator as anti-dilutive: | |||||||||||
Common shares excluded from the denominator as anti-dilutive | 43 | 3 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Schedule of Non-Vested Stock Activity (Detail) - 2006 Stock-Based Incentive Compensation Plan [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Non-vested stock, beginning balance, Number of Shares | 445,964 | 400,801 |
Granted, Number of Shares | 143,121 | 190,134 |
Vested, Number of Shares | (181,194) | (131,807) |
Forfeited, Number of Shares | (28,332) | (13,164) |
Non-vested stock, ending balance, Number of Shares | 379,559 | 445,964 |
Non-vested stock, beginning balance, Weighted Average Grant Date Fair Value | $ 19.70 | $ 18.86 |
Granted, Weighted Average Grant Date Fair Value | 37.10 | 22.94 |
Vested, Weighted Average Grant Date Fair Value | 20.53 | 21.85 |
Forfeited, Weighted Average Grant Date Fair Value | 19.61 | 19.50 |
Non-vested stock, ending balance, Weighted Average Grant Date Fair Value | $ 25.87 | $ 19.70 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Schedule of Share Based Compensation Stock Options Activity (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock Options, Granted, Number of Shares | 0 | 0 | 0 |
2006 Stock-Based Incentive Compensation Plan [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock Options, Outstanding, Number of Shares, Beginning Balance | 4,500 | ||
Stock Options, Canceled, forfeited or expired, Number of Shares | (4,500) | ||
Stock Options, Outstanding, Number of Shares, Ending Balance | 4,500 | ||
Stock Options, Outstanding, Weighted Average Exercise Price, Beginning Balance | $ 19.27 | ||
Stock Options, Canceled, forfeited or expired, Weighted Average Exercise Price | $ 19.27 | ||
Stock Options, Outstanding, Weighted Average Exercise Price, Ending Balance | $ 19.27 | ||
Stock Options, Outstanding, Weighted Average Contractual Life In Years | 6 months |
Summary of Significant Accou_13
Summary of Significant Accounting Policies - Recast of Our Results for Prior Year (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||||||||||
Revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 |
Cost of revenues: | |||||||||||
Cost of revenues | 800,427 | 670,111 | 642,526 | ||||||||
Gross profit | 438,534 | 359,908 | 335,611 | ||||||||
As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 1,030,019 | 978,137 | |||||||||
Rental Depreciation [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 208,453 | 169,455 | 162,415 | ||||||||
Rental Expense [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 89,520 | 77,706 | 71,694 | ||||||||
Accounting Standards Update 2014-09 [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 1,030,019 | 978,137 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 670,111 | 642,526 | |||||||||
Gross profit | 359,908 | 335,611 | |||||||||
Accounting Standards Update 2014-09 [Member] | Adjustments [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 6,900 | 6,800 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 5,400 | 5,400 | |||||||||
Accounting Standards Update 2014-09 [Member] | Rental Depreciation [Member] | As Previously Reported [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 169,455 | 162,415 | |||||||||
Accounting Standards Update 2014-09 [Member] | Rental Expense [Member] | As Previously Reported [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 77,706 | 71,694 | |||||||||
Equipment Rentals [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 592,193 | 479,016 | 445,227 | ||||||||
Cost of revenues: | |||||||||||
Gross profit | 294,220 | 231,855 | 211,118 | ||||||||
Equipment Rentals [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 479,016 | 445,227 | |||||||||
Equipment Rentals [Member] | Rental Depreciation [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 208,453 | 169,455 | 162,415 | ||||||||
Equipment Rentals [Member] | Rental Expense [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 89,520 | 77,706 | 71,694 | ||||||||
Equipment Rentals [Member] | Accounting Standards Update 2014-09 [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 479,016 | 445,227 | |||||||||
New Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 262,948 | 203,301 | 196,688 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 232,057 | 180,702 | 175,556 | ||||||||
Gross profit | 30,891 | 22,599 | 21,132 | ||||||||
New Equipment Sales [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 203,301 | 196,688 | |||||||||
New Equipment Sales [Member] | Accounting Standards Update 2014-09 [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 203,301 | 196,688 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 180,702 | 175,556 | |||||||||
Used Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 125,125 | 107,329 | 96,910 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 86,052 | 74,132 | 66,738 | ||||||||
Gross profit | 39,073 | 33,197 | 30,172 | ||||||||
Used Equipment Sales [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 107,329 | 96,910 | |||||||||
Used Equipment Sales [Member] | Accounting Standards Update 2014-09 [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 107,329 | 96,910 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 74,132 | 66,738 | |||||||||
Parts Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 120,454 | 114,253 | 115,989 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 88,263 | 83,135 | 84,327 | ||||||||
Gross profit | 32,191 | 31,118 | 31,662 | ||||||||
Parts Sales [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 114,253 | 115,989 | |||||||||
Parts Sales [Member] | Accounting Standards Update 2014-09 [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 107,384 | 109,147 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 77,713 | 78,966 | |||||||||
Parts Sales [Member] | Accounting Standards Update 2014-09 [Member] | Adjustments [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 6,869 | 6,842 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 5,422 | 5,361 | |||||||||
Services Revenues [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 63,488 | 62,873 | 64,673 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 21,328 | 21,111 | 21,839 | ||||||||
Gross profit | 42,160 | 41,762 | 42,834 | ||||||||
Services Revenues [Member] | Accounting Standards Update 2014-09 [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 62,873 | 64,673 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 21,111 | 21,839 | |||||||||
Other [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 74,753 | 63,247 | 58,650 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 74,754 | 63,870 | 59,957 | ||||||||
Gross profit | $ (1) | (623) | (1,307) | ||||||||
Other [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 63,247 | 58,650 | |||||||||
Other [Member] | Accounting Standards Update 2014-09 [Member] | As Previously Reported [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 70,116 | 65,492 | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 69,292 | 65,318 | |||||||||
Other [Member] | Accounting Standards Update 2014-09 [Member] | Adjustments [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | (6,869) | (6,842) | |||||||||
Cost of revenues: | |||||||||||
Cost of revenues | $ (5,422) | $ (5,361) |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) $ / shares in Units, $ in Thousands | Feb. 01, 2019USD ($)Branch | Apr. 01, 2018USD ($)Branch | Jan. 01, 2018USD ($)Branch | Dec. 31, 2018USD ($)Location | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)Location$ / shares | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Business Acquisition [Line Items] | ||||||||||||||
Number of branches located | Location | 77 | 77 | ||||||||||||
Total revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 | |||
Net income | 25,060 | $ 21,314 | $ 20,771 | $ 9,478 | 85,928 | $ 8,462 | $ 9,878 | $ 5,390 | 76,623 | 109,658 | 37,172 | |||
Goodwill | $ 105,843 | $ 31,197 | 105,843 | $ 31,197 | $ 31,197 | |||||||||
CEC [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Business acquisition, completion date | Jan. 1, 2018 | |||||||||||||
Number of branches located | Branch | 3 | |||||||||||||
Aggregate consideration paid to the owners | $ 132,400 | |||||||||||||
Percentage of goodwill deductible for income tax purposes | 100.00% | |||||||||||||
Acquisition costs | $ 1,000 | 200 | ||||||||||||
Total revenues | 39,300 | |||||||||||||
Net income | 5,100 | |||||||||||||
Goodwill | $ 45,092 | |||||||||||||
Rental Inc [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Business acquisition, completion date | Apr. 1, 2018 | |||||||||||||
Number of branches located | Branch | 5 | |||||||||||||
Aggregate consideration paid to the owners | $ 68,600 | |||||||||||||
Percentage of goodwill deductible for income tax purposes | 100.00% | |||||||||||||
Acquisition costs | $ 300 | |||||||||||||
Total revenues | 25,300 | |||||||||||||
Net income | $ 300 | |||||||||||||
Goodwill | 29,554 | |||||||||||||
Net income per share | $ / shares | $ 0.01 | |||||||||||||
Rental Inc [Member] | Purchase Agreement [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Accrued purchase price consideration included in goodwill | $ 3,400 | |||||||||||||
WRI [Member] | Subsequent Event [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Business acquisition, completion date | Feb. 1, 2019 | |||||||||||||
Number of branches located | Branch | 6 | |||||||||||||
Aggregate consideration paid to the owners | $ 108,500 |
Acquisitions - Summary of Estim
Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Apr. 01, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 105,843 | $ 31,197 | $ 31,197 | ||
CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 1,244 | ||||
Accounts receivable | 7,583 | ||||
Inventory | 504 | ||||
Prepaid expenses and other assets | 324 | ||||
Rental equipment | 55,342 | ||||
Property and equipment | 2,700 | ||||
Intangible assets | 21,500 | ||||
Total identifiable assets acquired | 89,197 | ||||
Accounts payable | (1,023) | ||||
Accrued expenses payable and other liabilities | (876) | ||||
Total liabilities assumed | (1,899) | ||||
Net identifiable assets acquired | 87,298 | ||||
Goodwill | 45,092 | ||||
Net assets acquired | $ 132,390 | ||||
Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 260 | ||||
Accounts receivable | 2,873 | ||||
Inventory | 5,324 | ||||
Prepaid expenses and other assets | 47 | ||||
Rental equipment | 22,578 | ||||
Property and equipment | 1,935 | ||||
Intangible assets | 10,200 | ||||
Total identifiable assets acquired | 43,217 | ||||
Accounts payable | (439) | ||||
Manufacturer flooring plans payable | (3,293) | ||||
Accrued expenses payable and other liabilities | (469) | ||||
Total liabilities assumed | (4,201) | ||||
Net identifiable assets acquired | 39,016 | ||||
Goodwill | 29,554 | ||||
Net assets acquired | $ 68,570 |
Acquisitions - Summary of Est_2
Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Parenthetical) (Detail) $ in Thousands | Apr. 01, 2018USD ($)ReportingUnit | Jan. 01, 2018USD ($)ReportingUnit | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Business Acquisition [Line Items] | |||||
Goodwill | $ 105,843 | $ 31,197 | $ 31,197 | ||
CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 21,500 | ||||
Goodwill | $ 45,092 | ||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||
CEC [Member] | Rental Component 1 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 25,233 | ||||
CEC [Member] | Rental Component 2 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 18,391 | ||||
CEC [Member] | New Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 217 | ||||
CEC [Member] | Used Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 632 | ||||
CEC [Member] | Parts [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 379 | ||||
CEC [Member] | Service [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 240 | ||||
Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 10,200 | ||||
Goodwill | $ 29,554 | ||||
Number of goodwill reporting units | ReportingUnit | 6 | ||||
Rental Inc [Member] | Rental Component 1 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 9,064 | ||||
Rental Inc [Member] | Rental Component 2 [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 5,445 | ||||
Rental Inc [Member] | New Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 10,217 | ||||
Rental Inc [Member] | Used Equipment [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 1,692 | ||||
Rental Inc [Member] | Parts [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 2,171 | ||||
Rental Inc [Member] | Service [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 964 | ||||
Customer Relationships [Member] | CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 21,000 | ||||
Life (years) | 10 years | ||||
Customer Relationships [Member] | Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 10,000 | ||||
Life (years) | 10 years | ||||
Tradenames [Member] | CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 300 | ||||
Life (years) | 1 year | ||||
Tradenames [Member] | Rental Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 200 | ||||
Life (years) | 1 year | ||||
Leasehold Interests [Member] | CEC [Member] | |||||
Business Acquisition [Line Items] | |||||
Fair Value (amounts in thousands) | $ 200 | ||||
Life (years) | 10 years |
Acquisitions - Unaudited Pro Fo
Acquisitions - Unaudited Pro Forma Consolidated Statements of Income Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Business Acquisition [Line Items] | |||||||||||
Total revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 |
Pretax income | $ 34,755 | $ 28,971 | $ 27,869 | $ 13,068 | $ 27,569 | $ 7,577 | $ 15,668 | $ 8,530 | 104,663 | 59,344 | $ 59,030 |
Elimination of merger related costs | 788 | ||||||||||
Pro forma pretax income (loss) | 104,663 | 60,132 | |||||||||
Pro forma income tax expense (benefit) | 28,040 | (50,511) | |||||||||
Pro forma net income (loss) | $ 76,623 | $ 110,643 | |||||||||
Pro forma net income (loss) per share – basic | $ 2.15 | $ 3.12 | |||||||||
Pro forma net income (loss) per share - diluted | $ 2.13 | $ 3.10 | |||||||||
Pro forma adjustments to pretax income: | |||||||||||
Total revenues | $ 1,246,369 | $ 1,101,751 | |||||||||
Pretax income | 105,683 | 69,654 | |||||||||
Pro forma adjustments to pretax income: | |||||||||||
Impact of fair value mark-ups/useful life changes on depreciation | (749) | (6,369) | |||||||||
Intangible asset amortization | (300) | (3,620) | |||||||||
Elimination of merger related costs | 5,285 | ||||||||||
Interest expense | (480) | (1,609) | |||||||||
Elimination of historic interest expense | 82 | 2,348 | |||||||||
Pro forma pretax income (loss) | 104,236 | 65,689 | |||||||||
Pro forma income tax expense (benefit) | 27,926 | (55,179) | |||||||||
Pro forma net income (loss) | $ 76,310 | $ 120,868 | |||||||||
Pro forma net income (loss) per share – basic | $ 2.14 | $ 3.40 | |||||||||
Pro forma net income (loss) per share - diluted | $ 2.13 | $ 3.39 | |||||||||
CEC [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total revenues | $ 39,300 | ||||||||||
Total revenues | $ 36,790 | ||||||||||
Pretax income | 3,043 | ||||||||||
Pro forma adjustments to pretax income: | |||||||||||
Impact of fair value mark-ups/useful life changes on depreciation | (3,575) | ||||||||||
Intangible asset amortization | (2,420) | ||||||||||
Elimination of merger related costs | 4,465 | ||||||||||
Elimination of historic interest expense | 1,966 | ||||||||||
Pro forma pretax income (loss) | 3,479 | ||||||||||
Pro forma income tax expense (benefit) | (2,922) | ||||||||||
Pro forma net income (loss) | $ 6,401 | ||||||||||
Pro forma net income (loss) per share – basic | $ 0.18 | ||||||||||
Pro forma net income (loss) per share - diluted | $ 0.18 | ||||||||||
Rental Inc [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total revenues | 25,300 | ||||||||||
Total revenues | 7,408 | $ 34,942 | |||||||||
Pretax income | 1,020 | 7,267 | |||||||||
Pro forma adjustments to pretax income: | |||||||||||
Impact of fair value mark-ups/useful life changes on depreciation | (749) | (2,794) | |||||||||
Intangible asset amortization | (300) | (1,200) | |||||||||
Interest expense | (480) | (1,609) | |||||||||
Elimination of historic interest expense | 82 | 382 | |||||||||
Pro forma pretax income (loss) | (427) | 2,046 | |||||||||
Pro forma income tax expense (benefit) | (114) | (1,719) | |||||||||
Pro forma net income (loss) | $ (313) | $ 3,765 | |||||||||
Pro forma net income (loss) per share – basic | $ (0.01) | $ 0.11 | |||||||||
Pro forma net income (loss) per share - diluted | $ (0.01) | $ 0.11 |
Acquisitions - Unaudited Pro _2
Acquisitions - Unaudited Pro Forma Consolidated Statements of Income Information (Detail) (Parenthetical) | Apr. 01, 2018 |
Rental Inc [Member] | |
Business Acquisition [Line Items] | |
Business acquisition, completion date | Apr. 1, 2018 |
Receivables - Summary of Receiv
Receivables - Summary of Receivables (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Receivables [Abstract] | ||
Trade receivables | $ 194,601 | $ 172,522 |
Unbilled rental revenue | 8,833 | 6,291 |
Income tax receivables | 2,181 | 997 |
Other | 35 | 45 |
Total receivables | 205,650 | 179,855 |
Less allowance for doubtful accounts | (4,094) | (3,774) |
Total receivables, net | $ 201,556 | $ 176,081 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Inventory [Line Items] | ||
Total inventories, net | $ 104,598 | $ 75,004 |
New Equipment Sales [Member] | ||
Inventory [Line Items] | ||
Total inventories, net | 84,603 | 55,704 |
Used Equipment Sales [Member] | ||
Inventory [Line Items] | ||
Total inventories, net | 1,980 | 2,421 |
Parts, Supplies and Other [Member] | ||
Inventory [Line Items] | ||
Total inventories, net | $ 18,015 | $ 16,879 |
Inventories - Additional Inform
Inventories - Additional Information (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Net of reserves for inventory obsolescence | $ 368 | $ 947 |
Property and Equipment - Summar
Property and Equipment - Summary of Net Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 257,783 | $ 233,289 |
Less accumulated depreciation and amortization | (142,662) | (131,500) |
Total net property and equipment | 115,121 | 101,789 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 7,597 | 7,165 |
Transportation Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 106,011 | 93,550 |
Building and Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 63,060 | 55,523 |
Office and Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 51,758 | 53,256 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 17,811 | 15,983 |
Property under Capital Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 2,417 | 3,217 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 9,129 | $ 4,595 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |||
Depreciation and amortization of property and equipment | $ 24.6 | $ 23.8 | $ 27.3 |
Manufacturer Flooring Plans P_3
Manufacturer Flooring Plans Payable - Additional Information (Detail) - Manufacturer Flooring Plans Payable [Member] | Dec. 31, 2018 |
Schedule Of Long Term Debt [Line Items] | |
Debt instrument interest rate, minimum | 0.00% |
Debt instrument interest rate, maximum | 5.50% |
Manufacturer Flooring Plans P_4
Manufacturer Flooring Plans Payable - Maturities of Manufacturer Flooring Plans Payable (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Schedule Of Long Term Debt [Line Items] | ||
Total | $ 23,666 | $ 22,002 |
Manufacturer Flooring Plans Payable [Member] | ||
Schedule Of Long Term Debt [Line Items] | ||
2,019 | 12,605 | |
2,020 | 10,822 | |
2,021 | 239 | |
Total | $ 23,666 |
Accrued Expenses Payable and _3
Accrued Expenses Payable and Other Liabilities - Accrued Expenses Payable and Other Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Accounts Payable And Accrued Liabilities Current And Noncurrent [Abstract] | ||
Payroll and related liabilities | $ 24,864 | $ 20,429 |
Sales, use and property taxes | 10,069 | 9,635 |
Accrued interest | 18,771 | 19,134 |
Accrued insurance | 4,328 | 4,211 |
Deferred revenue | 5,973 | 6,631 |
Other | 9,366 | 5,055 |
Total accrued expenses payable and other liabilities | $ 73,371 | $ 65,095 |
Senior Unsecured Notes - Additi
Senior Unsecured Notes - Additional Information (Detail) - USD ($) | Nov. 22, 2017 | Sep. 25, 2017 | Aug. 24, 2017 | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | |||||
Estimated offering expenses | $ 3,000,000 | $ 3,772,000 | |||
Add-on Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 200,000,000 | ||||
Senior unsecured notes, interest rate | 5.625% | ||||
Senior unsecured notes, maturity year | 2,025 | ||||
Net proceeds from sale of notes | $ 209,200 | ||||
Price percentage for Add-on Notes, Principal amount | 104.25% | ||||
5.6250% Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 750,000,000 | ||||
Senior unsecured notes, interest rate | 5.625% | ||||
Senior unsecured notes, maturity year | 2,025 | ||||
Estimated offering expenses | $ 10,300,000 | ||||
Net proceeds from sale of notes | $ 739,700,000 | ||||
Redemption price percentage as equal to principal amount of old notes to be redeemed | 101.00% | ||||
Principal payments due until maturity | $ 0 | ||||
Maturity date of notes | Sep. 1, 2025 | ||||
Debt instrument, Payment terms | The New Notes were issued at par and require semiannual interest payments on March 1st and September 1st of each year, commencing on March 1, 2018. No principal payments are due until maturity (September 1, 2025). | ||||
Debt Instrument, Redemption description | The New Notes are redeemable, in whole or in part, at any time on or after September 1, 2020 at specified redemption prices plus accrued and unpaid interest to the date of redemption. We may redeem up to 40% of the aggregate principal amount of the New Notes before September 1, 2020 with the net cash proceeds from certain equity offerings. We may also redeem the New Notes prior to September 1, 2020 at a specified “make-whole” redemption price plus accrued and unpaid interest to the date of redemption. | ||||
5.6250% Senior Notes [Member] | Maximum [Member] | Before September 1, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Percentage of principal amount of new notes may be redeemed | 40.00% | ||||
7% Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Senior unsecured notes, interest rate | 7.00% | ||||
Senior unsecured notes, maturity year | 2,022 | ||||
Repurchase of notes | $ 329,700,000 | ||||
Early tender deadline amount received on debt instrument | 1,038.90 | ||||
Principal amount of old notes | $ 1,000 | ||||
Remaining principal amount outstanding of old notes redeemed | $ 300,300,000 | ||||
Redemption price percentage as equal to principal amount of old notes to be redeemed | 103.50% |
Senior Unsecured Notes - Reconc
Senior Unsecured Notes - Reconciliation of Senior Unsecured Notes to Condensed Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands | 4 Months Ended | 8 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Aug. 24, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||||
Senior unsecured notes, beginning balance | $ 944,088 | ||||
Amortization of deferred financing costs | 1,083 | $ 1,046 | $ 1,052 | ||
Senior unsecured notes, ending balance | $ 944,088 | 944,780 | 944,088 | ||
Senior Unsecured Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Senior unsecured notes, beginning balance | $ 627,711 | 944,088 | 627,711 | ||
Accretion of discount | 1,539 | ||||
Amortization of note premium | (1,062) | ||||
Amortization of deferred financing costs | 153 | 312 | |||
Senior unsecured notes, ending balance | 944,088 | 944,780 | 944,088 | $ 627,711 | |
Senior Unsecured Notes [Member] | 7% Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Accretion of discount | 683 | ||||
Amortization of note premium | $ (574) | ||||
Aggregate principal amount paid | (630,000) | ||||
Writeoff of unaccreted discount | 5,294 | ||||
Writeoff of unamortized premium | (4,452) | ||||
Writeoff of deferred financing costs | 1,185 | ||||
Senior Unsecured Notes [Member] | 5.6250% Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount paid | 950,000 | ||||
Writeoff of unaccreted discount | (14,684) | ||||
Writeoff of unamortized premium | $ 8,500 | ||||
Accretion of discount | 542 | ||||
Amortization of note premium | (375) | ||||
Amortization of deferred financing costs | $ 105 | ||||
Additional deferred financing costs | $ (97) |
Senior Secured Credit Facility
Senior Secured Credit Facility - Additional Information (Detail) - USD ($) | Feb. 01, 2019 | Dec. 22, 2017 | Dec. 21, 2017 | Dec. 31, 2018 | Feb. 14, 2019 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||||||
Outstanding letters of credit | $ 7,700,000 | $ 7,700,000 | ||||
Wells Fargo Capital Finance, LLC [Member] | Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Existing credit facility with its lenders | $ 750,000,000 | |||||
Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Existing credit facility with its lenders | $ 750,000,000 | $ 602,500,000 | ||||
Debt instrument maturity date description | extended the maturity date of the credit facility from May 21, 2019 to December 22, 2022 | |||||
Debt instrument maturity date | Dec. 22, 2022 | May 21, 2019 | ||||
Uncommitted incremental revolving capacity | $ 250,000,000 | $ 150,000,000 | ||||
Outstanding letters of credit | $ 170,800,000 | |||||
Available borrowings under our senior secured credit facility | $ 571,500,000 | |||||
Revolving Credit Facility [Member] | Subsequent Event [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument maturity date description | extended the maturity date of the credit facility from December 22, 2022 to January 31, 2024 | |||||
Debt instrument maturity date | Jan. 31, 2024 | |||||
Outstanding letters of credit | $ 7,700,000 | |||||
Available borrowings under our senior secured credit facility | $ 483,300,000 | |||||
Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Unused commitment fee margin percentage | 0.375% | |||||
Revolving Credit Facility [Member] | Maximum [Member] | Letter of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Margin rate lowered in applicable to Letter of Credit | 2.00% | |||||
Revolving Credit Facility [Member] | Maximum [Member] | Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 1.00% | |||||
Revolving Credit Facility [Member] | Maximum [Member] | Base Rate [Member] | Subsequent Event [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 0.75% | |||||
Revolving Credit Facility [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 2.00% | |||||
Revolving Credit Facility [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Subsequent Event [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 1.75% | |||||
Revolving Credit Facility [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Unused commitment fee margin percentage | 0.25% | |||||
Revolving Credit Facility [Member] | Minimum [Member] | Letter of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Margin rate lowered in applicable to Letter of Credit | 1.50% | |||||
Revolving Credit Facility [Member] | Minimum [Member] | Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 0.50% | |||||
Revolving Credit Facility [Member] | Minimum [Member] | Base Rate [Member] | Subsequent Event [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 0.25% | |||||
Revolving Credit Facility [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 1.50% | |||||
Revolving Credit Facility [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Subsequent Event [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Applicable margin Percentage | 1.25% | |||||
Letter of Credit Sub-Facility, and Guaranty [Member] | Subsequent Event [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Existing credit facility with its lenders | $ 30,000,000 |
Capital Lease Obligations - Add
Capital Lease Obligations - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2018Lease_Agreement | |
Debt Disclosure [Abstract] | |
Number of capital lease obligation | 1 |
Capital lease obligation expiring | 2,022 |
Capital Lease Obligations - Fut
Capital Lease Obligations - Future Minimum Capital Lease Payments (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Capital Leases Future Minimum Payments Net Present Value [Abstract] | ||
2,019 | $ 252 | |
2,020 | 252 | |
2,021 | 252 | |
2,022 | 42 | |
Total minimum lease payments | 798 | |
Less: amount representing interest | (72) | |
Present value of minimum lease payments | $ 726 | $ 1,486 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Statutory federal income tax rate | 21.00% | 35.00% | 35.00% | |
One-time decrease in income tax expense from re-measurement of deferred tax assets and liabilities | $ 66,900,000 | |||
Federal net operating loss carry forwards | $ 86,200,000 | |||
Expire in varying amounts for federal net operating loss carry forwards | 2030 through 2036 | |||
Federal net operating loss carry forwards does not expire | $ 298,200,000 | |||
Federal alternative minimum tax credit carry forwards | 3,000,000 | |||
General business credit carry forwards | $ 400,000 | |||
Expire in varying amounts for business credit carry forwards | 2026 and 2037 | |||
State income tax credits expiration date | 2,019 | |||
State income tax credits carry forward | $ 200,000 | |||
Tax Cuts and Jobs Act, AMT credit refundable period | 2018 and 2022 | |||
Tax Cuts and Jobs Act, Reclassification of deferred income taxes to income tax receivable | $ 1,500,000 | |||
Decreased in valuation allowance for state net operating losses that were realized | 100,000 | |||
Unrecognized tax benefits | $ 0 | 106,000 | $ 6,119,000 | $ 6,000,000 |
Lapse in statute of limitations related to unrecognized tax benefits | 6,013,000 | |||
Decrease in income tax expense resulting from lapse of statute limitations in unrecognized tax benefits | $ 5,900,000 |
Income Taxes - Income Tax Provi
Income Taxes - Income Tax Provision (Benefit) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||||
U.S. Federal, Current | $ (1,522) | |||
U.S. Federal, Deferred | 23,126 | $ (54,241) | $ 21,516 | |
U.S. Federal, Total | 21,604 | (54,241) | 21,516 | |
State, Current | 2,868 | 220 | 280 | |
State, Deferred | 3,568 | 3,707 | 62 | |
State, Total | 6,436 | 3,927 | 342 | |
Current, Total | 1,346 | 220 | 280 | |
Deferred, Total | 26,694 | (50,534) | 21,578 | |
Total | $ (5,900) | $ 28,040 | $ (50,314) | $ 21,858 |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Accounts receivable | $ 1,010 | $ 929 |
Inventories | 93 | 239 |
Net operating losses | 86,859 | 18,165 |
AMT and tax credits | 2,110 | 3,565 |
Sec 263A costs | 752 | 544 |
Accrued liabilities | 2,869 | 2,767 |
Deferred compensation | 1,561 | 1,132 |
Accrued interest | 387 | 365 |
Stock-based compensation | 146 | 181 |
Goodwill and intangible assets | 346 | |
Other assets | 415 | 531 |
Deferred tax assets, Total | 96,548 | 28,418 |
Valuation allowance | (609) | (732) |
Deferred tax assets, net of valuation allowance, Total | 95,939 | 27,686 |
Deferred tax liabilities: | ||
Property and equipment | (245,198) | (152,235) |
Investments | (1,076) | (1,066) |
Goodwill and intangible assets | (2,778) | (804) |
Deferred tax liabilities, Total | (249,052) | (154,105) |
Net deferred tax liabilities | $ (153,113) | $ (126,419) |
Income Taxes - Actual Income Ta
Income Taxes - Actual Income Tax Expense (benefit) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||
Computed tax at statutory rates | $ 21,979 | $ 20,770 | $ 20,660 | ||
Permanent items - other | 1,021 | 911 | 904 | ||
Permanent items - excess of tax deductible goodwill | (2,130) | ||||
State income tax, net of federal tax effect | 5,246 | 2,563 | 2,115 | ||
Change in valuation allowance | (123) | 397 | 207 | ||
Change in uncertain tax positions | (83) | (5,960) | 66 | ||
Other - change in deferred state rate | (2,094) | ||||
Impact of the Act federal rate change | $ (66,900) | (66,865) | |||
Total | $ (5,900) | $ 28,040 | $ (50,314) | $ 21,858 |
Income Taxes - Amounts of Gross
Income Taxes - Amounts of Gross Unrecognized Tax Benefits (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Gross unrecognized tax benefits at January 1 | $ 106,000 | $ 6,119,000 |
Increases in tax positions taken in prior years | 22,000 | |
Decreases in tax positions taken in prior years | (106,000) | (22,000) |
Lapse in statute of limitations | (6,013,000) | |
Gross unrecognized tax benefits at December 31 | $ 0 | $ 106,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Line Items] | |||
Rent expense on property leases and equipment leases | $ 23.1 | $ 20.1 | $ 18.7 |
Outstanding letters of credit | $ 7.7 | $ 7.7 | |
Letter of Credit [Member] | |||
Commitments And Contingencies Disclosure [Line Items] | |||
Expiration date of letter of credit | May 31, 2019 | ||
Line of credit renewed terms | 1 year |
Commitments and Contingencies_2
Commitments and Contingencies - Future Minimum Operating Lease Payments (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Operating Leases Future Minimum Payments Due [Abstract] | |
2,019 | $ 21,775 |
2,020 | 21,965 |
2,021 | 21,176 |
2,022 | 19,854 |
2,023 | 17,145 |
Thereafter | 86,398 |
Total | $ 188,313 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Compensation And Retirement Disclosure [Abstract] | |||
Amount of contributions in profit - sharing plan net of employee forfeitures | $ 2.5 | $ 2.2 | $ 2 |
Deferred Compensation Plans - A
Deferred Compensation Plans - Additional Information (Detail) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)CompensationPlan | Dec. 31, 2017USD ($) | |
Postemployment Benefits [Abstract] | ||
Number of deferred compensation plan | CompensationPlan | 1 | |
Effective rate | 4.50% | |
Aggregate deferred compensation payable | $ 1,989 | $ 1,903 |
Accrued interest | $ 1,500 | $ 1,400 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Perkins-McKenzie Insurance Agency Inc. [Member] | |||
Related Party Transaction [Line Items] | |||
Commissions paid | $ 0.8 | $ 0.8 | $ 0.9 |
John M. Engquist [Member] | B-C Equipment Sales Inc [Member] | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership interest in equity | 50.00% | ||
Products and services purchased | $ 0.1 | 0.4 | 0.4 |
Sales to related party | $ 0.1 | $ 0.1 | $ 0.1 |
John M. Engquist [Member] | Perkins-McKenzie Insurance Agency Inc. [Member] | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership interest in equity | 30.00% | ||
John M. Engquist Mother's Estate [Member] | Perkins-McKenzie Insurance Agency Inc. [Member] | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership interest in equity | 12.00% | ||
John M Engquist Sister [Member] | Perkins-McKenzie Insurance Agency Inc. [Member] | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership interest in equity | 6.00% |
Summarized Quarterly Financia_3
Summarized Quarterly Financial Data (Unaudited) - Summary of Unaudited Quarterly Financial Results of Operations (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 |
Income from operations | 50,899 | 45,318 | 43,103 | 27,326 | 40,268 | 47,654 | 28,668 | 21,325 | 166,646 | 137,915 | 110,767 |
Income before provision for income taxes | 34,755 | 28,971 | 27,869 | 13,068 | 27,569 | 7,577 | 15,668 | 8,530 | 104,663 | 59,344 | 59,030 |
Net income | $ 25,060 | $ 21,314 | $ 20,771 | $ 9,478 | $ 85,928 | $ 8,462 | $ 9,878 | $ 5,390 | $ 76,623 | $ 109,658 | $ 37,172 |
Basic net income per common share | $ 0.70 | $ 0.60 | $ 0.58 | $ 0.27 | $ 2.41 | $ 0.24 | $ 0.28 | $ 0.15 | $ 2.15 | $ 3.09 | $ 1.05 |
Diluted net income per common share | $ 0.70 | $ 0.59 | $ 0.58 | $ 0.26 | $ 2.40 | $ 0.24 | $ 0.28 | $ 0.15 | $ 2.13 | $ 3.07 | $ 1.05 |
Summarized Quarterly Financia_4
Summarized Quarterly Financial Data (Unaudited) - Summary of Unaudited Quarterly Financial Results of Operations (Parenthetical) (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||
Merger breakup fee proceeds (net of merger costs) | $ 5,800,000 | $ 6,500,000 | |||
Loss on early extinguishment of debt | 25,400,000 | $ 25,363,000 | |||
Unrecognized tax benefits | 106,000 | 6,000,000 | $ 0 | 106,000 | $ 6,119,000 |
Income tax expense (benefit) | $ (5,900,000) | $ 28,040,000 | (50,314,000) | $ 21,858,000 | |
One-time decrease in income tax expense related to impact from enactment | $ 66,900,000 | $ 66,865,000 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2018CustomerSegment | Dec. 31, 2017Customer | Dec. 31, 2016Customer | |
Segment Reporting [Abstract] | |||
Number of reportable segment | Segment | 5 | ||
Sales to international customers | 0.10% | 0.40% | 0.40% |
Customer accounted for more than 10% of revenue | Customer | 0 | 0 | 0 |
Segment Information - Schedule
Segment Information - Schedule of Information about Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Revenues: | |||||||||||
Revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 |
Segment Gross Profit: | |||||||||||
Total gross profit | 438,534 | 359,908 | 335,611 | ||||||||
Segment identified assets: | |||||||||||
Total assets | 1,727,181 | 1,467,717 | 1,727,181 | 1,467,717 | |||||||
Operating Segments [Member] | |||||||||||
Segment Revenues: | |||||||||||
Revenues | 1,164,208 | 966,772 | 919,487 | ||||||||
Segment Gross Profit: | |||||||||||
Total gross profit | 438,535 | 360,531 | 336,918 | ||||||||
Segment identified assets: | |||||||||||
Total assets | 1,246,096 | 979,828 | 1,246,096 | 979,828 | |||||||
Operating Segments [Member] | Equipment Rentals [Member] | |||||||||||
Segment Revenues: | |||||||||||
Revenues | 592,193 | 479,016 | 445,227 | ||||||||
Segment Gross Profit: | |||||||||||
Total gross profit | 294,220 | 231,855 | 211,118 | ||||||||
Segment identified assets: | |||||||||||
Total assets | 1,141,498 | 904,824 | 1,141,498 | 904,824 | |||||||
Operating Segments [Member] | New Equipment Sales [Member] | |||||||||||
Segment Revenues: | |||||||||||
Revenues | 262,948 | 203,301 | 196,688 | ||||||||
Segment Gross Profit: | |||||||||||
Total gross profit | 30,891 | 22,599 | 21,132 | ||||||||
Operating Segments [Member] | Used Equipment Sales [Member] | |||||||||||
Segment Revenues: | |||||||||||
Revenues | 125,125 | 107,329 | 96,910 | ||||||||
Segment Gross Profit: | |||||||||||
Total gross profit | 39,073 | 33,197 | 30,172 | ||||||||
Segment identified assets: | |||||||||||
Total assets | 86,583 | 58,125 | 86,583 | 58,125 | |||||||
Operating Segments [Member] | Parts Sales [Member] | |||||||||||
Segment Revenues: | |||||||||||
Revenues | 120,454 | 114,253 | 115,989 | ||||||||
Segment Gross Profit: | |||||||||||
Total gross profit | 32,191 | 31,118 | 31,662 | ||||||||
Operating Segments [Member] | Services Revenues [Member] | |||||||||||
Segment Revenues: | |||||||||||
Revenues | 63,488 | 62,873 | 64,673 | ||||||||
Segment Gross Profit: | |||||||||||
Total gross profit | 42,160 | 41,762 | 42,834 | ||||||||
Operating Segments [Member] | Parts and Services [Member] | |||||||||||
Segment identified assets: | |||||||||||
Total assets | 18,015 | 16,879 | 18,015 | 16,879 | |||||||
Non-Segmented [Member] | |||||||||||
Segment Revenues: | |||||||||||
Revenues | 74,753 | 63,247 | 58,650 | ||||||||
Segment Gross Profit: | |||||||||||
Total gross profit | (1) | (623) | $ (1,307) | ||||||||
Segment identified assets: | |||||||||||
Total assets | $ 481,085 | $ 487,889 | $ 481,085 | $ 487,889 |
Consolidating Financial Infor_3
Consolidating Financial Information of Guarantor Subsidiaries - Condensed Consolidating Balance Sheet (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||||
Cash | $ 16,677 | $ 165,878 | ||
Receivables, net | 201,556 | 176,081 | ||
Inventories, net | 104,598 | 75,004 | ||
Prepaid expenses and other assets | 10,508 | 9,172 | ||
Rental equipment, net | 1,141,498 | 904,824 | ||
Property and equipment, net | 115,121 | 101,789 | ||
Deferred financing costs, net | 3,000 | 3,772 | ||
Intangible assets, net | 28,380 | |||
Goodwill | 105,843 | 31,197 | $ 31,197 | |
Total assets | 1,727,181 | 1,467,717 | ||
Liabilities and Stockholders’ Equity: | ||||
Amount due on senior secured credit facility | 170,761 | |||
Accounts payable | 101,840 | 89,781 | ||
Manufacturer flooring plans payable | 23,666 | 22,002 | ||
Accrued expenses payable and other liabilities | 73,371 | 65,095 | ||
Dividends payable | 132 | 150 | ||
Senior unsecured notes | 944,780 | 944,088 | ||
Capital leases payable | 726 | 1,486 | ||
Deferred income taxes | 153,113 | 126,419 | ||
Deferred compensation payable | 1,989 | 1,903 | ||
Total liabilities | 1,470,378 | 1,250,924 | ||
Stockholders’ equity | 256,803 | 216,793 | $ 142,765 | $ 142,588 |
Total liabilities and stockholders’ equity | 1,727,181 | 1,467,717 | ||
Reportable Legal Entities [Member] | H & E Equipment Services [Member] | ||||
Assets: | ||||
Cash | 16,677 | 165,878 | ||
Receivables, net | 166,393 | 138,657 | ||
Inventories, net | 94,483 | 63,828 | ||
Prepaid expenses and other assets | 10,382 | 9,030 | ||
Rental equipment, net | 983,281 | 760,972 | ||
Property and equipment, net | 98,251 | 89,952 | ||
Deferred financing costs, net | 3,000 | 3,772 | ||
Investment in guarantor subsidiaries | 246,309 | 222,217 | ||
Intangible assets, net | 28,380 | |||
Goodwill | 76,317 | 1,671 | ||
Total assets | 1,723,473 | 1,455,977 | ||
Liabilities and Stockholders’ Equity: | ||||
Amount due on senior secured credit facility | 170,761 | |||
Accounts payable | 95,866 | 78,811 | ||
Manufacturer flooring plans payable | 23,178 | 20,300 | ||
Accrued expenses payable and other liabilities | 76,798 | 67,466 | ||
Dividends payable | 185 | 197 | ||
Senior unsecured notes | 944,780 | 944,088 | ||
Deferred income taxes | 153,113 | 126,419 | ||
Deferred compensation payable | 1,989 | 1,903 | ||
Total liabilities | 1,466,670 | 1,239,184 | ||
Stockholders’ equity | 256,803 | 216,793 | ||
Total liabilities and stockholders’ equity | 1,723,473 | 1,455,977 | ||
Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | ||||
Assets: | ||||
Receivables, net | 35,163 | 37,424 | ||
Inventories, net | 10,115 | 11,176 | ||
Prepaid expenses and other assets | 126 | 142 | ||
Rental equipment, net | 158,217 | 143,852 | ||
Property and equipment, net | 16,870 | 11,837 | ||
Goodwill | 29,526 | 29,526 | ||
Total assets | 250,017 | 233,957 | ||
Liabilities and Stockholders’ Equity: | ||||
Accounts payable | 5,974 | 10,970 | ||
Manufacturer flooring plans payable | 488 | 1,702 | ||
Accrued expenses payable and other liabilities | (3,427) | (2,371) | ||
Dividends payable | (53) | (47) | ||
Capital leases payable | 726 | 1,486 | ||
Total liabilities | 3,708 | 11,740 | ||
Stockholders’ equity | 246,309 | 222,217 | ||
Total liabilities and stockholders’ equity | 250,017 | 233,957 | ||
Elimination [Member] | ||||
Assets: | ||||
Investment in guarantor subsidiaries | (246,309) | (222,217) | ||
Total assets | (246,309) | (222,217) | ||
Liabilities and Stockholders’ Equity: | ||||
Stockholders’ equity | (246,309) | (222,217) | ||
Total liabilities and stockholders’ equity | $ (246,309) | $ (222,217) |
Consolidating Financial Infor_4
Consolidating Financial Information of Guarantor Subsidiaries - Condensed Consolidating Statement of Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||||||||||
Revenues | $ 345,974 | $ 322,141 | $ 310,364 | $ 260,482 | $ 294,666 | $ 259,162 | $ 249,363 | $ 226,828 | $ 1,238,961 | $ 1,030,019 | $ 978,137 |
Cost of revenues: | |||||||||||
Cost of revenues | 800,427 | 670,111 | 642,526 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 438,534 | 359,908 | 335,611 | ||||||||
Selling, general and administrative expenses | 278,298 | 232,784 | 228,129 | ||||||||
Merger costs (net of merger breakup fee proceeds) | 708 | (5,782) | |||||||||
Gain from sales of property and equipment, net | 7,118 | 5,009 | 3,285 | ||||||||
Income from operations | 50,899 | 45,318 | 43,103 | 27,326 | 40,268 | 47,654 | 28,668 | 21,325 | 166,646 | 137,915 | 110,767 |
Other income (expense): | |||||||||||
Interest expense | (63,707) | (54,958) | (53,604) | ||||||||
Loss on early extinguishment of debt | (25,400) | (25,363) | |||||||||
Other, net | 1,724 | 1,750 | 1,867 | ||||||||
Total other expense, net | (61,983) | (78,571) | (51,737) | ||||||||
Income before provision (benefit) for income taxes | 34,755 | 28,971 | 27,869 | 13,068 | 27,569 | 7,577 | 15,668 | 8,530 | 104,663 | 59,344 | 59,030 |
Provision (benefit) for income taxes | (5,900) | 28,040 | (50,314) | 21,858 | |||||||
Net income | $ 25,060 | $ 21,314 | $ 20,771 | $ 9,478 | $ 85,928 | $ 8,462 | $ 9,878 | $ 5,390 | 76,623 | 109,658 | 37,172 |
Rental Depreciation [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 208,453 | 169,455 | 162,415 | ||||||||
Rental Expense [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 89,520 | 77,706 | 71,694 | ||||||||
Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 1,035,942 | 849,032 | 805,673 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 665,252 | 554,253 | 530,593 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 370,690 | 294,779 | 275,080 | ||||||||
Selling, general and administrative expenses | 232,892 | 190,392 | 187,369 | ||||||||
Equity in earnings of guarantor subsidiaries | 13,247 | 16,136 | 11,416 | ||||||||
Merger costs (net of merger breakup fee proceeds) | 708 | (5,782) | |||||||||
Gain from sales of property and equipment, net | 6,475 | 2,435 | 2,789 | ||||||||
Income from operations | 156,812 | 128,740 | 101,916 | ||||||||
Other income (expense): | |||||||||||
Interest expense | (53,681) | (45,480) | (44,503) | ||||||||
Loss on early extinguishment of debt | (25,363) | ||||||||||
Other, net | 1,532 | 1,447 | 1,617 | ||||||||
Total other expense, net | (52,149) | (69,396) | (42,886) | ||||||||
Income before provision (benefit) for income taxes | 104,663 | 59,344 | 59,030 | ||||||||
Provision (benefit) for income taxes | 28,040 | (50,314) | 21,858 | ||||||||
Net income | 76,623 | 109,658 | 37,172 | ||||||||
Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 203,019 | 180,987 | 172,464 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 135,175 | 115,858 | 111,933 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 67,844 | 65,129 | 60,531 | ||||||||
Selling, general and administrative expenses | 45,406 | 42,392 | 40,760 | ||||||||
Gain from sales of property and equipment, net | 643 | 2,574 | 496 | ||||||||
Income from operations | 23,081 | 25,311 | 20,267 | ||||||||
Other income (expense): | |||||||||||
Interest expense | (10,026) | (9,478) | (9,101) | ||||||||
Other, net | 192 | 303 | 250 | ||||||||
Total other expense, net | (9,834) | (9,175) | (8,851) | ||||||||
Income before provision (benefit) for income taxes | 13,247 | 16,136 | 11,416 | ||||||||
Net income | 13,247 | 16,136 | 11,416 | ||||||||
Elimination [Member] | |||||||||||
Gross profit (loss): | |||||||||||
Equity in earnings of guarantor subsidiaries | (13,247) | (16,136) | (11,416) | ||||||||
Income from operations | (13,247) | (16,136) | (11,416) | ||||||||
Other income (expense): | |||||||||||
Income before provision (benefit) for income taxes | (13,247) | (16,136) | (11,416) | ||||||||
Net income | (13,247) | (16,136) | (11,416) | ||||||||
Equipment Rentals [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 592,193 | 479,016 | 445,227 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 294,220 | 231,855 | 211,118 | ||||||||
Equipment Rentals [Member] | Rental Depreciation [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 208,453 | 169,455 | 162,415 | ||||||||
Equipment Rentals [Member] | Rental Expense [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 89,520 | 77,706 | 71,694 | ||||||||
Equipment Rentals [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 506,620 | 395,275 | 364,654 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 251,762 | 190,188 | 170,907 | ||||||||
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 85,573 | 83,741 | 80,573 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 42,458 | 41,667 | 40,211 | ||||||||
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Depreciation [Member] | H & E Equipment Services [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 178,371 | 140,489 | 134,484 | ||||||||
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Depreciation [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 30,082 | 28,966 | 27,931 | ||||||||
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Expense [Member] | H & E Equipment Services [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 76,487 | 64,598 | 59,263 | ||||||||
Equipment Rentals [Member] | Reportable Legal Entities [Member] | Rental Expense [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 13,033 | 13,108 | 12,431 | ||||||||
New Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 262,948 | 203,301 | 196,688 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 232,057 | 180,702 | 175,556 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 30,891 | 22,599 | 21,132 | ||||||||
New Equipment Sales [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 207,564 | 166,730 | 158,291 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 183,164 | 148,163 | 140,948 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 24,400 | 18,567 | 17,343 | ||||||||
New Equipment Sales [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 55,384 | 36,571 | 38,397 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 48,893 | 32,539 | 34,608 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 6,491 | 4,032 | 3,789 | ||||||||
Used Equipment Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 125,125 | 107,329 | 96,910 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 86,052 | 74,132 | 66,738 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 39,073 | 33,197 | 30,172 | ||||||||
Used Equipment Sales [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 102,005 | 84,741 | 78,956 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 69,960 | 59,481 | 55,075 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 32,045 | 25,260 | 23,881 | ||||||||
Used Equipment Sales [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 23,120 | 22,588 | 17,954 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 16,092 | 14,651 | 11,663 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 7,028 | 7,937 | 6,291 | ||||||||
Parts Sales [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 120,454 | 114,253 | 115,989 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 88,263 | 83,135 | 84,327 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 32,191 | 31,118 | 31,662 | ||||||||
Parts Sales [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 103,586 | 97,852 | 100,920 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 76,425 | 71,603 | 73,587 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 27,161 | 26,249 | 27,333 | ||||||||
Parts Sales [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 16,868 | 16,401 | 15,069 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 11,838 | 11,532 | 10,740 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 5,030 | 4,869 | 4,329 | ||||||||
Services Revenues [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 63,488 | 62,873 | 64,673 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 21,328 | 21,111 | 21,839 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 42,160 | 41,762 | 42,834 | ||||||||
Services Revenues [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 53,534 | 52,807 | 55,391 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 18,100 | 17,851 | 18,963 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 35,434 | 34,956 | 36,428 | ||||||||
Services Revenues [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 9,954 | 10,066 | 9,282 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 3,228 | 3,260 | 2,876 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | 6,726 | 6,806 | 6,406 | ||||||||
Other [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 74,753 | 63,247 | 58,650 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 74,754 | 63,870 | 59,957 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | (1) | (623) | (1,307) | ||||||||
Other [Member] | Reportable Legal Entities [Member] | H & E Equipment Services [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 62,633 | 51,627 | 47,461 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 62,745 | 52,068 | 48,273 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | (112) | (441) | (812) | ||||||||
Other [Member] | Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | |||||||||||
Revenues: | |||||||||||
Revenues | 12,120 | 11,620 | 11,189 | ||||||||
Cost of revenues: | |||||||||||
Cost of revenues | 12,009 | 11,802 | 11,684 | ||||||||
Gross profit (loss): | |||||||||||
Gross profit | $ 111 | $ (182) | $ (495) |
Consolidating Financial Infor_5
Consolidating Financial Information of Guarantor Subsidiaries - Condensed Consolidating Statement of Cash Flows (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | ||||
Net income | $ 76,623 | $ 109,658 | $ 37,172 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization on property and equipment | 24,593 | 23,790 | 27,282 | |
Depreciation on rental equipment | 208,453 | 169,455 | 162,415 | |
Amortization of intangible assets | 3,320 | |||
Amortization of deferred financing costs | 1,083 | 1,046 | 1,052 | |
Accretion of note discount, net of premium amortization | 477 | 274 | 168 | |
Provision for losses on accounts receivable | 2,741 | 3,932 | 3,137 | |
Provision for inventory obsolescence | 122 | 161 | 127 | |
Change in deferred income taxes | 26,695 | (50,535) | 21,578 | |
Stock-based compensation expense | 4,214 | 3,526 | 3,037 | |
Loss on early extinguishment of debt | $ 25,400 | 25,363 | ||
Gain from sales of property and equipment, net | (7,118) | (5,009) | (3,285) | |
Gain from sales of rental equipment, net | (38,352) | (31,882) | (29,003) | |
Changes in operating assets and liabilities, net of acquisitions: | ||||
Receivables | (17,761) | (40,012) | 4,154 | |
Inventories | (48,230) | (31,771) | 4,267 | |
Prepaid expenses and other assets | (965) | (1,659) | 2,541 | |
Accounts payable | 6,994 | 50,349 | (27,345) | |
Manufacturer flooring plans payable | 1,664 | (8,778) | (31,653) | |
Accrued expenses payable and other liabilities | 2,572 | 8,230 | 1,667 | |
Deferred compensation payable | 86 | 61 | (332) | |
Net cash provided by operating activities | 247,211 | 226,199 | 176,979 | |
Cash flows from investing activities: | ||||
Acquisition of business, net of cash acquired | (196,027) | |||
Purchases of property and equipment | (34,960) | (22,515) | (22,895) | |
Purchases of rental equipment | (416,600) | (234,209) | (179,709) | |
Proceeds from sales of property and equipment | 9,261 | 7,506 | 3,805 | |
Proceeds from sales of rental equipment | 112,086 | 96,143 | 84,389 | |
Net cash used in investing activities | (526,240) | (153,075) | (114,410) | |
Cash flows from financing activities: | ||||
Purchases of treasury stock | (1,350) | (783) | (561) | |
Borrowings on senior secured credit facility | 1,436,849 | 1,193,544 | 966,146 | |
Payments on senior secured credit facility | (1,266,088) | (1,356,186) | (988,361) | |
Dividends paid | (39,274) | (39,172) | (39,066) | |
Principal payments on senior unsecured notes due 2023 | (630,000) | |||
Costs paid to tender and redeem senior unsecured notes due 2022 | (23,336) | |||
Proceeds from issuance of senior unsecured notes due 2025 | 958,500 | |||
Payments of deferred financing costs | (97) | (17,278) | ||
Payments of capital lease obligations | (212) | (218) | (203) | |
Net cash provided by (used in) financing activities | 129,828 | 85,071 | (62,045) | |
Net increase (decrease) in cash | (149,201) | 158,195 | 524 | |
Cash, beginning of year | 165,878 | 7,683 | 7,159 | |
Cash, end of year | 16,677 | 165,878 | 7,683 | |
Reportable Legal Entities [Member] | H & E Equipment Services [Member] | ||||
Cash flows from operating activities: | ||||
Net income | 76,623 | 109,658 | 37,172 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization on property and equipment | 21,570 | 20,742 | 24,194 | |
Depreciation on rental equipment | 178,371 | 140,489 | 134,484 | |
Amortization of intangible assets | 3,320 | |||
Amortization of deferred financing costs | 1,083 | 1,046 | 1,052 | |
Accretion of note discount, net of premium amortization | 477 | 274 | 168 | |
Provision for losses on accounts receivable | 2,065 | 3,148 | 2,616 | |
Provision for inventory obsolescence | 122 | 161 | 127 | |
Change in deferred income taxes | 26,695 | (50,535) | 21,578 | |
Stock-based compensation expense | 4,214 | 3,526 | 3,037 | |
Loss on early extinguishment of debt | 25,363 | |||
Gain from sales of property and equipment, net | (6,475) | (2,435) | (2,789) | |
Gain from sales of rental equipment, net | (31,595) | (24,063) | (22,780) | |
Equity in earnings of guarantor subsidiaries | (13,247) | (16,136) | (11,416) | |
Changes in operating assets and liabilities, net of acquisitions: | ||||
Receivables | (19,346) | (29,083) | 8,783 | |
Inventories | (45,349) | (23,221) | 5,785 | |
Prepaid expenses and other assets | (981) | (1,687) | 2,566 | |
Accounts payable | 11,990 | 42,623 | (27,771) | |
Manufacturer flooring plans payable | 2,878 | (10,599) | (31,534) | |
Accrued expenses payable and other liabilities | 4,176 | 8,660 | 2,263 | |
Deferred compensation payable | 86 | 61 | (332) | |
Net cash provided by operating activities | 216,677 | 197,992 | 147,203 | |
Cash flows from investing activities: | ||||
Acquisition of business, net of cash acquired | (196,027) | |||
Purchases of property and equipment | (26,903) | (17,852) | (19,505) | |
Purchases of rental equipment | (362,780) | (198,988) | (138,562) | |
Proceeds from sales of property and equipment | 8,617 | 3,528 | 3,190 | |
Proceeds from sales of rental equipment | 92,014 | 74,090 | 67,282 | |
Investment in subsidiaries | (10,845) | 14,128 | 2,749 | |
Net cash used in investing activities | (495,924) | (125,094) | (84,846) | |
Cash flows from financing activities: | ||||
Purchases of treasury stock | (1,350) | (783) | (561) | |
Borrowings on senior secured credit facility | 1,436,849 | 1,193,544 | 966,146 | |
Payments on senior secured credit facility | (1,266,088) | (1,356,186) | (988,361) | |
Dividends paid | (39,268) | (39,164) | (39,057) | |
Principal payments on senior unsecured notes due 2023 | (630,000) | |||
Costs paid to tender and redeem senior unsecured notes due 2022 | (23,336) | |||
Proceeds from issuance of senior unsecured notes due 2025 | 958,500 | |||
Payments of deferred financing costs | (97) | (17,278) | ||
Net cash provided by (used in) financing activities | 130,046 | 85,297 | (61,833) | |
Net increase (decrease) in cash | (149,201) | 158,195 | 524 | |
Cash, beginning of year | 165,878 | 7,683 | 7,159 | |
Cash, end of year | 16,677 | 165,878 | 7,683 | |
Reportable Legal Entities [Member] | Guarantor Subsidiaries [Member] | ||||
Cash flows from operating activities: | ||||
Net income | 13,247 | 16,136 | 11,416 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization on property and equipment | 3,023 | 3,048 | 3,088 | |
Depreciation on rental equipment | 30,082 | 28,966 | 27,931 | |
Provision for losses on accounts receivable | 676 | 784 | 521 | |
Gain from sales of property and equipment, net | (643) | (2,574) | (496) | |
Gain from sales of rental equipment, net | (6,757) | (7,819) | (6,223) | |
Changes in operating assets and liabilities, net of acquisitions: | ||||
Receivables | 1,585 | (10,929) | (4,629) | |
Inventories | (2,881) | (8,550) | (1,518) | |
Prepaid expenses and other assets | 16 | 28 | (25) | |
Accounts payable | (4,996) | 7,726 | 426 | |
Manufacturer flooring plans payable | (1,214) | 1,821 | (119) | |
Accrued expenses payable and other liabilities | (1,604) | (430) | (596) | |
Net cash provided by operating activities | 30,534 | 28,207 | 29,776 | |
Cash flows from investing activities: | ||||
Purchases of property and equipment | (8,057) | (4,663) | (3,390) | |
Purchases of rental equipment | (53,820) | (35,221) | (41,147) | |
Proceeds from sales of property and equipment | 644 | 3,978 | 615 | |
Proceeds from sales of rental equipment | 20,072 | 22,053 | 17,107 | |
Net cash used in investing activities | (41,161) | (13,853) | (26,815) | |
Cash flows from financing activities: | ||||
Dividends paid | (6) | (8) | (9) | |
Payments of capital lease obligations | (212) | (218) | (203) | |
Capital contributions | 10,845 | (14,128) | (2,749) | |
Net cash provided by (used in) financing activities | 10,627 | (14,354) | (2,961) | |
Elimination [Member] | ||||
Cash flows from operating activities: | ||||
Net income | (13,247) | (16,136) | (11,416) | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Equity in earnings of guarantor subsidiaries | 13,247 | 16,136 | 11,416 | |
Cash flows from investing activities: | ||||
Investment in subsidiaries | 10,845 | (14,128) | (2,749) | |
Net cash used in investing activities | 10,845 | (14,128) | (2,749) | |
Cash flows from financing activities: | ||||
Capital contributions | (10,845) | 14,128 | 2,749 | |
Net cash provided by (used in) financing activities | $ (10,845) | $ 14,128 | $ 2,749 |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Year | $ 4,721 | $ 4,669 | $ 5,663 |
Additions Charged to Costs and Expenses | 2,863 | 4,093 | 3,264 |
Deductions | (3,122) | (4,041) | (4,258) |
Balance at End of Year | 4,462 | 4,721 | 4,669 |
Allowance for doubtful accounts receivable [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Year | 3,774 | 3,769 | 4,729 |
Additions Charged to Costs and Expenses | 2,741 | 3,932 | 3,137 |
Deductions | (2,421) | (3,927) | (4,097) |
Balance at End of Year | 4,094 | 3,774 | 3,769 |
Allowance for inventory obsolescence [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Year | 947 | 900 | 934 |
Additions Charged to Costs and Expenses | 122 | 161 | 127 |
Deductions | (701) | (114) | (161) |
Balance at End of Year | $ 368 | $ 947 | $ 900 |