Herc (HRI) Citi's Global Industrial Tech & Mobility Conference 2026 summary

Company overview and growth strategy

• Achieved nearly 10% CAGR revenue growth and close to 12% EBITDA CAGR over the past decade, with significant margin expansion and a focus on North America after exiting international markets.

• Expanded to over 600 locations and 9,600 employees, with no single customer or vertical representing more than 3% and 10% of business, respectively.

• Growth driven by disciplined capital allocation, investments in fleet, M&A, and technology, with a focus on top 100 MSAs and specialty offerings.

• Specialty business now comprises about 18% of fleet, with a goal to increase to 22-23% in the next three years and 25-30% over time.

• Technology stack is considered industry-leading, with over 300 new features added last year and a 50% increase in online ordering.

H&E acquisition and integration

• H&E acquisition added 162 locations and 45,000 new customers, accelerating growth by four to five years and increasing network scale.

• Integration completed rapidly, including IT stack and sales territory realignment, with branch network optimization to be finished by end of the current quarter.

• Dyssynergies were higher and more immediate than expected, with a 15% customer loss at close, but fleet was right-sized and synergy investments made in late 2025.

• Achieved $40 million in revenue synergies in the last six months, with $100-120 million expected in 2026; cost synergies of $125 million in EBITDA to be fully realized in 2026.

• Employee integration included rapid onboarding, extensive training on technology and sales tools, and efforts to rebuild and connect the sales force.

Specialty and mega project focus

• Specialty offerings deliver 800-1,000 basis points higher dollar utilization and margin, with a focus on engineered solutions and expertise.

• Mega project participation is counted only when named as primary or secondary, currently at the midpoint of a 10-15% share target, with expectations to reach the top end in the next 1-2 years.

• Mega projects span LNG plants, data centers, power plants, stadiums, and infrastructure, with safety and specialty capabilities as key differentiators.

• Margin profile for mega projects aligns with overall business over time, with initial scale benefits and later specialty-driven margin improvement.