Hertz Slashes Q2 EBITDA Forecast to $50–$80 Million, Plans $100m Stock, $300m Notes
HTZ•Hertz cut its Q2 adjusted EBITDA forecast to $50–$80 million citing May used-car losses and now expects $300 net depreciation per unit monthly. The company unveiled a $100 million share-lending stock sale and a $300 million exchangeable First-Lien PIK note offering, pushing shares down over 20%.
1. Q2 EBITDA Guidance Reduction
Hertz cut its second-quarter adjusted EBITDA outlook to $50 million–$80 million, attributing the reduction to unexpected used-car market weakness and losses on May vehicle sales. It now expects net depreciation per unit of about $300 monthly after May losses offset April gains, pressuring margins.
2. $100m Share Lending Stock Offering
Hertz proposes lending $100 million of common shares to an underwriter that will sell the borrowed shares to facilitate hedging in a separate private offering. The company will not receive sale proceeds but will collect a nominal lending fee, and this stock sale is contingent on the notes offering closing.
3. $300m Exchangeable PIK Notes
A Hertz subsidiary intends to place $300 million of Exchangeable Senior First-Lien PIK Notes due 2030 in a private Rule 144A offering, exchangeable into cash or common stock at the issuer’s option. Proceeds are earmarked for general corporate purposes, including potential debt repayment, and this deal is not contingent on the stock lending transaction.
