Hertz Global Holdings, Inc. Morgan Stanley Laguna Conference NYSE: - - PowerPoint PPT Presentation

Hertz Global Holdings, Inc.

Morgan Stanley Laguna Conference

NYSE: HTZ September 14, 2016

2 Certain statements contained in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements give our current expectations or forecasts of future events and our future performance and do not relate directly to historical or current events or our historical or current

• performance. Most of these statements contain words that identify them as forward looking, such as “anticipate”,

“estimate”, “expect”, “project”, “intend”, “plan”, “believe”, “seek”, “will”, “may”, “opportunity”, “target” or other words that relate to future events, as opposed to past or current events. Forward-looking statements are based on the expectations, forecasts and assumptions of our management as of the date of the Public Disclosure and involve risks and uncertainties, some of which are outside of our control, that could cause actual outcomes and results to differ materially from current expectations. For some of the factors that could cause such differences, please see the sections of our quarterly report on Form 10-Q for the quarter ended June 30, 2016 entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements.” Copies of this report are available from the Securities and Exchange Commission (“SEC”), on our website or through our Investor Relations department. The financial information contained in this presentation is a compilation of information that has previously been disclosed by us in various SEC filings and press releases (a “Public Disclosure”). The financial information in this presentation speaks only as of the date it was previously disclosed in a Public Disclosure, and we are not updating it in this presentation. We cannot assure you that the assumptions under any of the forward-looking statements will prove accurate or that any projections will be realized. We expect that there will be differences between projected and actual results. These forward-looking statements speak only as of the date of the Public Disclosure, and we do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or

• therwise. We caution prospective investors not to place undue reliance on forward-looking statements. All forward-

looking statements attributable to us are expressly qualified in their entirety by the cautionary statements contained herein and in our quarterly report described above.

Forward-Looking Statements

3 Hertz Global Holdings, Inc. (“HGH”) is the ultimate parent company of The Hertz Corporation (“THC”, “Company,” “we,” “us” and “our”). GAAP and non-GAAP profitability metrics for THC, the wholly owned operating subsidiary, are materially the same as those for HGH. The Company has three reportable segments as follows:

• U.S. Rental Car (“U.S. RAC”) - rental of vehicles (cars, crossovers and light trucks), as well as ancillary products

and services, in the United States and consists of the Company’s United States operating segment;

• International Rental Car (“International RAC”) - rental and leasing of vehicles (cars, vans, crossovers and light

trucks), as well as ancillary products and services, internationally and consists of the Company’s Europe and Other International operating segments, which are aggregated into a reportable segment based primarily upon similar economic characteristics, products and services, customers, delivery methods and general regulatory environments;

• All Other Operations - includes the Company’s Donlen operating segment which provides vehicle leasing and

fleet management services and is not considered a separate reportable segment in accordance with applicable accounting standards, together with other business activities. In addition to the above reportable segments, the Company has corporate operations (“Corporate”) which includes general corporate assets and expenses and certain interest expense (including net interest on non-vehicle debt). Hertz Global RAC is defined as the combination of the U.S. and International segments. Hertz Global is defined as Hertz Global RAC, Donlen and Corporate. Amounts shown in this presentation, unless otherwise indicated, are for Hertz Global.

Disclosure on Financials in Presentation

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Hertz Global RAC Investment Highlights

Geographically Diversified Global Network World Class Brands Targeting Distinct Segments of Market Market Leader within Consolidated Industry Industry Savvy and Experienced Leadership Team Potential for Driving Industry Improvement Emerging Mobility Trends Create Opportunity Full Potential Plan1 – Adjusted Corporate EBITDA Margin Target 16%-18%

1Full potential Adjusted Corporate EBITDA margin target 2018-2020

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Attractive Financial Attributes

Strong Free Cash Flow Generation Largely Discretionary Non-fleet Capex Significant Tax Assets (NOLs) Resulting in Low Cash Taxes Strong Balance Sheet and Liquidity Position with No Significant Near-Term Corporate Maturities and Access to ABS Market Highly Variable Cost Structure Liquid Fleet Assets with Embedded Equity Full Potential Plan of $810 million of EBITDA Improvement (Midpoint)

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Started upgrade

• f the entire IT

infrastructure, systems and applications

On track

IT systems upgrade Reverse spin-off completed June 2016 HERC separation



Completed Dollar-Thrifty systems integration



Integration HQ relocation completed Nov. 2015



Headquarters relocation Successfully executed largest fleet refresh in company history Fleet refresh



Key Accomplishments

2Q16: Net Promoter Score (“NPS”) increased across all brands; Hertz brand rose to record high Improving customer satisfaction

On track

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Full Potential Plan Targets 16%-18% Margin1

Delivering Revenue Excellence Winning with Technology

Deliver on technology and systems that enhance customer experience and reduce cost

Leading on Cost and Quality

Drive cost position and service quality to industry leadership through operational excellence Drive excellence in core revenue performance by reinvigorating go to market execution and targeting growth opportunities in enhanced products and services Win customer preference and loyalty through clearly defined and positioned brands supported by consistent, well-tailored and differentiated service model

3 2 1

1Full potential Adjusted Corporate EBITDA margin target 2018-2020

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Perspectives on Risk Considerations

Residual Value Pricing Economic Cycle Capital Structure / Leverage Mobility

• Industry has historically offset with pricing increases
• Future purchases will be lower cost (average in / out)
• Benefit of alternate disposition channels
• Industry over-fleeting dynamics showing signs of improvement
• Management experience
• Ability to de-fleet, releasing equity and de-levering in down cycle
• Business model flexibility
• Targeting leverage range of 2.5x – 3.5x year end
• No material non-vehicle debt maturities until 20201
• Ongoing access to ABS market to fund fleet
• Ride-sharing use case – little impact from ride-sharing to date
• Rental car core competence creates opportunities
• 1. Pro forma for (i) the issuance by THC of $800 million aggregate principal amount of 5.50% Senior Notes due 2024 on September 22, 2016

and (ii) the redemption by THC of $800 million aggregate principal amount of 6.75% Senior Notes due 2019 on October 8, 2016.

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Full Potential is Achievable

No company specific constraints to improved margins

We have a proven potential

2015 and YTD 2016 is an early demonstration

• f execution capabilities

We are proving our capability for execution and realizing potential Team with proven expertise implementing these types of changes Combination of fresh talent and deeply experienced industry leaders

We have the Right team It’s within

• ur control

Focused on initiatives we can execute vs. aspirations around industry conduct Low end of the range achievable with reasonable realization of initiatives within our control Improved industry dynamics would provide upside opportunity

Q&A

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Adjusted Corporate EBITDA Net income before net interest expense, income taxes, depreciation (which includes revenue earning equipment lease charges) and amortization as adjusted for car rental fleet interest, car rental fleet depreciation, car rental debt- related charges, and for certain other charges such as non- cash stock-based employee compensation restructuring and restructuring related costs; equipment rental spin-off costs; impairments and asset write-downs; acquisition costs, integration costs, relocation costs and other extraordinary, unusual or non-recurring items. The ratio of Adjusted Corporate EBITDA to total revenues. Adjusted Corporate EBITDA Margin

Key Definitions

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A reconciliation of the non-GAAP measures discussed in this presentation to the most directly comparable financial measures calculated and presented in accordance with generally accepted accounting principles in the United States appears within the supplemental schedules that have been filed with the Securities and Exchange Commission and are available on the Company’s website at http://ir.hertz.com/events- presentations.

Key Definitions