Winter weather and the oil industry’s slump dropped Baton Rouge-based H&E Equipment Services Inc.’s first-quarter earnings to $6.1 million, or 17 cents per share.
For the same period in 2014, the heavy-equipment supplier turned a profit of $7.4 million, or 21 cents per share. First-quarter revenue dipped 4.1 percent to $227.4 million. Analysts surveyed by Thomson Reuters expected a profit of 21 cents per share on revenue of $244.4 million.
On the plus side, H&E Chief Executive Officer John Engquist said rental equipment remained strong and increased 17.6 percent to $101.4 million despite poor weather.
“In spite of the significant downturn in the oil patch, we grew our same-store rental revenues about 16 percent year-over-year,” Engquist said during a Thursday conference call with investors and Wall Street analysts. However, H&E’s rental segment’s performance wasn’t quite enough to overcome the plunge in new equipment sales, which fell 36 percent to $44.5 million.
Engquist said the recovery accelerated in commercial construction markets and helped offset softness in the oil and gas industry.
“We believe the healthy momentum in the commercial construction markets and significant industrial expansion in Louisiana and Texas will continue to drive further growth in 2015, especially in the back half of the year,” Engquist said.
For the first time in several years, H&E issued guidance for the full year to help investors who may have a hard time understanding the impact of low energy prices on the heavy equipment industry, Engquist said.
H&E expects 2015 revenue in the range of $1.07 billion to $1.09 billion. The company expects earnings before income tax, depreciation and amortization — an indicator of financial performance — in the range of $334 million to $352 million.