Neff Corp's (NEFF) CEO Graham Hood on Q2 2016 Results - Earnings Call Transcript

| About: Neff Corp. (NEFF)
This article is now exclusive for PRO subscribers.

Neff Corp. (NYSE:NEFF) Q2 2016 Earnings Conference Call July 28, 2016 10:00 AM ET

Executives

Graham Hood - President and Chief Executive Officer

Mark Irion - Chief Financial Officer

Analysts

George Tong - Piper Jaffray

Justin Jordan - Jefferies & Company

Ross Gilardi - Bank of America Merrill Lynch

Tim Meissner - Goodwood Capital

Larry Pfeffer - Avondale Partners

Operator

Good day, ladies and gentlemen, and welcome to the Second Quarter 2016 Neff Corporation Conference Call. My name is Scott, and I'll be your coordinator for today. As a reminder, this conference call is being recorded for replay purposes.

On the call with me today are Graham Hood, President and Chief Executive Officer, and Mark Irion, Chief Financial Officer. Graham and Mark will be reviewing the second quarter results and also providing an update on the company's strategy and outlook for 2016. Following our prepared remarks, we will open the call to questions.

This call is being webcast, and the accompanying earnings presentation can be found on Neff's website at neffrental.com. The presentation material can be accessed through the Investor Relations section of the website, under the Events and Presentations tab. The Webcast will be posted at the company's website for replay approximately two hours following the end of this call. The replay will stay on the site for on-demand review over the next several months.

Before we get started, I need to review the safe harbor statement with you. Any statements in this call regarding the business that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934, and future results could differ materially from the forward-looking statements made today. Statements that include words such as anticipate, expect, believe, intend, and similar statements of a forward- or future-looking nature identify forward-looking statements.

Forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause the company's actual results to differ materially from those indicated in these forward-looking statements, including risks and uncertainties identified in our press release and in Item 1A, Risk Factors, in our annual report on Form 10-K and in other SEC filings. You should not place undue reliance on these statements.

The company undertakes no obligation to publicly update or revise any forward-looking statements, except to the extent required by law. The inclusion of any statement on this conference call does not constitute an admission by the company or any other person that the events or circumstances described in such statement are material.

The company will also discuss non-US GAAP financial measures on this conference call. A reconciliation of non-US GAAP financial measures to the most directly comparable US GAAP financial measures and other information relating to these measures can be found in the earnings press release and our earnings presentation.

And now I'd like to turn the call over to Graham to begin the discussion.

Graham Hood

Thank you, operator, and good morning, everyone. I want to start by welcoming all of our investors and thanking you for joining our second quarter earnings call. This morning, I'll provide an overview of our second quarter performance and also discuss activity within our regions and current market conditions. Mark will then review our second quarter financial results in more detail. After that, we'll be happy to take your questions.

The second quarter of 2016 was another solid quarter for Neff's rental business, as we generated record second quarter results for both rental revenues and adjusted EBITDA and also delivered impressive adjusted EBITDA margins of 50.7%. We grew rental revenues by 7.8% year-over-year, a good result with the headwinds we faced from the slowdown in oil and gas activities, which now seem to be dissipating.

We're pleased to note that our business outside of oil and gas is robust and growing at a double-digit rate, which gives us confidence for the rest of 2016, as we expect the oil and gas headwinds to continue easing in the second half of 2016, allowing the strength of the rest of our business to shine through.

We had 11.7% growth in rental revenues in our non-oil and gas branches, and adjusted EBITDA growth was also strong at 12.6%, clearly illustrating the strength of our core business. Overall, rental rates decreased 1.1% year-over-year. Outside of oil and gas, rental rates were flat year-over-year, so the main driver for the drop in rates was the oil and gas slowdown. Rental rates in oil and gas branches were down by 9.5%.

Time utilization was also up from prior year at 68%, compared to 67.1% from the second quarter of 2015, due to improved time utilization in our construction markets, as well as our oil and gas markets compared to prior year. We saw strong construction activity and good demand for our rental equipment throughout our network of branches, putting approximately $43.9 million more equipment on rent in Q2 2016 than we did in the second quarter of 2015, and this was accomplished, while having $9 million less equipment on rent in our oil and gas branches for the quarter.

Our markets remain strong, with the dollar value of projects under construction that we track through our CRN system up over 26% in 2016, compared to 2015. We're excited and very optimistic about business conditions and our ability to generate good results over the remainder of 2016.

Page 6, we believe shows that the macro environment is favorable for us, and we anticipate that it will set the stage for continued growth and strong performance for the rental industry in general as well as for Neff specifically. The construction industry has been in a steady recovery, and the latest FMI construction outlook is for 5.8% growth in total U.S. construction spending for 2016.

In addition, leading indicators like the ABI and the Dodge Momentum Index point towards an ongoing expansion in construction spending. There are few, if any, negative macro data points regarding US construction for the short to medium term. We continue to see solid construction demand in most of our markets, and expect that demand to remain strong for the second half of 2016.

Moving on to our end markets update on page seven, we have a diversified mix of revenues, and we're focused on some of the most active segments of the overall market. We believe we're positioned well in the Sunbelt region and the highest projected growth areas for rental industry revenues in the country. Construction growth in the Sunbelt states, where our branches are concentrated, is forecast at 6.6% for 2016, which is a better growth rate than as forecast for the states where we do not have a presence.

As you can see in the chart on the right-hand side, infrastructure, nonresidential construction, municipal and residential construction end markets continue to drive our business. The oil and gas end markets were about 7% of rental revenues in the second quarter of 2016, down from about 8% in the same quarter last year. We've actively managed our fleet. We've been able to mitigate much of the decline by capitalizing on the strong demand in our construction end markets. The growth in our main segments of infrastructure, nonresidential and residential construction has been sufficient to overcome the headwinds from the shrinking oil and gas markets.

If we turn to page 8, we can highlight the impact of oil and gas on our Q2 results, as we have done in previous quarters. We consider six of our 68 branches to have significant exposure to oil and gas drilling activities and rig maintenance. The impact in the rapid reduction in U.S. drilling activity is apparent in the results from these branches during Q2 of 2016. Also apparent is the strong growth in the majority of our business that has no exposure to upstream oil and gas activity.

From the chart on the left, you can see that rental revenues from our oil and gas branches were down by $2.2 million, or 26.1%, in Q2. This includes non oil and gas revenue on these branches, as they're not all 100% dependent on oil and gas. The rental revenue growth rate in the majority of the Neff branches that are not impacted by oil and gas was 11.7%. So, as we expected, the oil and gas slowdown has impacted our growth rates, but not our ability to grow. We don't expect any further significant change, decline or improvement in our oil and gas branches for the remainder of 2016.

The time utilization chart on the top right of page 8 highlights the year-over-year increase in time utilization for Q2. Time utilization in our oil and gas focused branches actually increased to 63.9%, from 60.5% in Q2 last year, as we've managed our fleet to appropriate levels. Q2 of last year was the quarter where we saw the most dislocation of fleet in our oil and gas branches, with fleet being turned in and relocated to other parts of the country. Time utilization in our branches increased to 68.4%, from 68% in the prior year, reflecting the continuation of strong economic conditions in the markets we serve.

Rental rates were also impacted in our oil and gas branches, down by 9.5% year-over-year, which took our overall rate growth to negative 1.1%. The rest of Neff had flat rental rate growth. Adjusted EBITDA growth was also delineated by oil and gas in the rest of the business. Adjusted EBITDA growth in our other branches was up by 12.6% year-over-year, with a 36.7% decline in our oil and gas branches adjusted EBITDA, which slowed our overall growth rate to 7.6%.

We believe the worst of the oil and gas slowdown is behind us. We believe that our solid Q2 results demonstrate the strength of our core construction-focused business. We remain excited about the construction activity in the markets that we serve for the second half of 2016, and are looking forward to delivering what we believe will be continued growth and good results, especially with the oil and gas drag abating in terms of year-over-year comparables.

Turning to page 9, I'll give you a quick overview of our fleet. We've made significant investments in our fleet of more than $785 million since 2011. This has allowed us to manage the fleet size to meet the steady increase in demand, as well as manage our fleet age to an average of 46 months. It's also positioned us to significant reduce our Capex requirements for 2016 as our focus turns to running a tighter utilization.

Our earth-moving focus remains clear, with earth-moving equipment comprising 54% of our fleet. Earth-moving continues to be the least penetrated category of equipment at an estimated penetration rate of 51%. We believe that we have the most upside potential for further penetration for our earth-moving fleet going forward. Earth-moving provides significant strategic value to our business, as it has a liquid aftermarket, drives our highest returns, and fits well with the most active market segments we pursue.

I'll now turn it over to Mark for a more detailed review of the financial results in the quarter.

Mark Irion

Thank you, Graham, and good morning, everyone. If you would turn to page 11, we have some of the highlights of our second quarter results. Rental revenues for the second quarter of 2016 were $91.5 million, up 7.8% from the same period last year. This increase was driven by improved rental volume from an increase in fleet size, as well as an increase in time utilization that was partially offset by a decrease in rental rates. Rental rate growth decreased 1.1% in the quarter, with a 9.5% drag from oil and gas branches, while our non oil and gas branch rate was flat for the quarter.

Time utilization increased by 0.9 percentage points to 68%, from 67.1% in the second quarter of 2015. As we heard from Graham, this included an increase from the oil and gas stores, which increased to 63.9% from 60.5% in the prior year, as well as an increase in the rest of Neff. In terms of our cost performance for the quarter, rental depreciation increased $1.5 million to $22.8 million for the second quarter of 2016, compared to $21.2 million for the second quarter of 2015. The increase in rental depreciation was primarily due to the purchase of new equipment and the increase in fleet size.

Cost of rental revenues increased 11.1% to $21.7 million for the second quarter of 2016 compared to the prior year quarter, primarily due to increased payroll and payroll-related expenses, rental split expenses and insurance expenses, partially offset by a decrease in repair costs and fuel expenses. SG&A for the second quarter of 2016 increased by $0.9 million, or 4.1%, to $23.4 million.

The net increase in selling, general and administrative expenses was attributable to several factors. Employee salaries, benefits and related employee expenses increased $1.3 million, primarily as a result of higher headcount, salaries and payroll taxes. Rent and software licensing expenses also increased, while public company expenses decreased $1.1 million year-over-year.

Adjusted EBITDA was $50.6 million in the second quarter of 2016, an increase of $3.6 million, or 7.6%, compared to the second quarter of 2015. The adjusted EBITDA margin was also very strong at 50.7%, increasing by 80 basis points, compared to 49.9% a year ago. Our return on invested capital remains solid at 10.3% for the 12 months ended June 30, 2016.

Looking at our rental fleet, the average fleet size in terms of original equipment costs, or OEC, for the quarter increased 7.1% over 2015 to $816.7 million. The average age of our rental fleet at June 30, 2016, increased slightly to 46 months from 44 months at June 30, 2015. Our gross Capex in Q2 of 2016 for rental fleet and PP&E was $44.1 million, and net Capex was $39.2 million.

With regards to our ABL, the balance outstanding on our revolving credit facility at the end of Q2 was $269.7 million, and as noted on page 13, availability under the borrowing base formula was approximately $201.2 million as of June 30, 2016. Our total leverage was 3.9 times at June 30, 2016. In the second quarter, we had an unrealized loss on the interest rate swap mark-to-market of $1.6 million, and as a result, there is a net unrealized loss of $8.1 million on the balance sheet at the end of June.

Also in the second quarter, we booked an increase to the payable due under the tax receivable agreement of $0.3 million. This is primarily due to an adjustment to the TRA due to the sale of used equipment that was purchased before the date of the IPO, which was partially offset by the impact of the shares repurchased during the quarter. This adjustment has typically amounted to an increase in the TRA liability of approximately $0.1 million to $0.5 million in each of the quarters since this IPO.

For the quarter, we repurchased approximately 512,000 shares for a cost of $4.2 million under our previously announced share repurchase program. For the full year, we have repurchased 1.4 million shares for a total cost of $9.4 million. We consider this program to be a favorable use of our capital that will enhance returns and deliver value to our shareholders. On page 15, we have reaffirmed our 2016 full-year guidance.

Our second quarter results were generally in line with expectations. However, the rate environment remains challenging. Although the drag from our oil and gas stores should start to lift over the next few quarters, we are not seeing the rate growth in our non oil and gas branches that we expected. For that reason, we are adjusting our guidance on rate growth for 2016 from 0% to 2% to a new guidance, which is negative 1% to 1%. Our EBITDA guidance remains unchanged at $190 million to $200 million for the full-year.

We remain cautiously optimistic about most of our markets for the balance of 2016. We continue to see robust construction activity in our footprint, and this should result in strong demand for our rental equipment. We continue to take a conservative approach to Capex and expect to generate free cash flow, with which we expect to pay down debt.

Thank you for your time today. Let me hand you back to Graham before we take questions.

A - Graham Hood

Thanks, Mark. Before we open the call to questions, let me close by saying we continue to manage our business operations well, and we remain excited about the strength we see in construction activity and in rental demand. Our outlook for the remainder of 2016 and beyond remains positive, as we believe our company will continue to benefit from the significant growth expected in the U.S. construction markets, particularly in our Sunbelt states.

Thank you for your support and time today. At this time, we'd like to take your questions. Operator, please provide instructions.

Question-and-Answer Session

Operator

[Operator Instructions] Your first question comes from the line of George Tong from Piper Jaffray. Your line is open.

George Tong

Hi Thanks, good morning.

Mark Irion

Hi, George.

George Tong

Outside of oil and gas, were there any other surprises in rates that contributed to your lowering of rate guidance for the year?

Mark Irion

I mean, I think it's just a very competitive market out there, so we were flat this quarter in terms of year-over-year. We're probably looking for some lift in terms of our expectations. So the market is always competitive, but it's especially competitive this year, so that's been our struggle and that's sort of where the adjustment in the guidance is coming from.

Graham Hood

Yes, and George, just to add, I mean, we're still focused on rate as a priority of the company, and we still think we can get to positive year over year in the back half. We think that's possible, but just overcoming the deficit that we have for the first half of the year sort of caused us to go in and relook at the guidance and lower that to something more feasible based on what we've seen so far in the first half of the year.

George Tong

Got it. And given no other parts of guidance was changed, which other areas are making up for the lost rates?

Mark Irion

I mean, I think the rest of the expectations are in line. So there was a range in our guidance, and an adjustment of 1% of rate still keeps us within that range.

George Tong

Got it. And then, lastly, could you elaborate on what you're seeing in nonresidential construction trends in the key markets that you're serving, and if you see any factors that could potentially drive a strengthening of activity?

Graham Hood

Yes, I mean, it's pretty broad-based. I think outside of oil and gas, we're seeing very active markets in most of the segments that we deal with. We feel very good about 2016, as we mentioned in the script. I mean, we're up 26% in our particular markets year over year for the amount of activity that we see, so we're - the ABI continues to be above 50, which indicates that we have some runway left in construction. The Dodge Momentum Index sort of verifies that as well, so it's pretty broad-based on the non-res side, the infrastructure side, the residential side. All those markets are very active for us in driving our revenue.

George Tong

Great. Thank you.

Graham Hood

Thanks, George.

Operator

Your next question comes from the line of Justin Jordan from Jefferies. Your line open.

Justin Jordan

Good morning everyone. Thank you. I just want to, I guess, explore a little bit further on George's comments on rates. Can you give us some feel for rates by type of equipment? I'm really going into your earth-moving specialization. You talked, obviously, about a very competitive market. That's not exactly surprise to anyone who's been looking at this industry this year, but is there a particular pressure that you're seeing in non-energy in earth-moving, or is it more intense in aerial, which is, obviously, I guess more commoditized versus the earth-moving, which is more of a specialism for Neff?

Graham Hood

Yes, I think it's pretty much across the board. The industry has always been competitive, so nothing has really changed there, and you always see irrational behavior here and there in any given market. Usually it's a different company, and quite often it's in a different category. In my opinion, there shouldn't be much rate pressure, as it's a very active market, but hopefully as utilizations continue to improve and fleet continues to get absorbed, the industry can regain that focus on rate improvement. I think the industry in general needs to implement a little more discipline and a little bit more control on the rate side, but as far as specifically naming categories, I don't think any categories have had any more pressure than others.

Justin Jordan

Okay. And just specifically on your energy exposure - and obviously it's falling by the quarter, but you're essentially talking about it being very stable from here, and I guess when we're thinking about that going forward, should we think about something like they could use rig count as a proxy for end market conditions, which that's stabilized and modestly rising in recent weeks, or how should we think about the headwinds unwinding for that business as we go forward? I'm just looking at what you call that as your energy revenues in, let's say, Q3 2015 and how that was declining at that point. Obviously, you're lapping much easier comps, as it were, in energy in Q3 2016 and Q4 2016.

Mark Irion

Yes. No, that's right, Justin. In terms of the rig count, I mean, we certainly don't have a direct correlation to four or five rigs starting or wrapping up. The activity is - I think from our experience, it's just down 50% sort of year on year, and we don't really expect a significant improvement or decrease from there. There's activity in these markets. They're not dead, and we've adjusted the fleet as best we can to the activity that's there, so it's still a decent market. They're sort of trending at sort of Neff average rates, and I just don't see, unless there's a big change in the oil prices, a big pickup in activity there.

In terms of the comps, you can see in the chart that we gave you on page 8 the time that's left over, Q2 last year was the quarter when we had the major dislocation and the volume of equipment on rent. The fleet was coming back in, we were getting it repaired, we were moving it to other branches or auctioning it off, so that was sort of the ebb or the low point in terms of time utilization that's left over.

In terms of rate, Q2 of 2015, we were still positive in terms of rate over 2014, so the rate took a little bit more time to sort of work its way through. That started showing up in Q3 and was pretty significant in Q4 and Q1. So the rate comps we haven't really come across, and the drop off in rate wasn't as significant as the drop off in time utilization. So that all - that headwind will sort of work its way out for the balance of the year, but it's not as dramatic a cliff.

Justin Jordan

But I guess I'm thinking about your oil and gas rental revenues in Q3 2015 were $8.4 million, so obviously, unless you've got a very distinct seasonality in your oil and gas revenues, you've got an easier comp specifically in that pocket of the business. And then when I think about it in - I'm sorry, correct me if I'm wrong on that.

Mark Irion

No, that's correct. That's correct.

Justin Jordan

Okay. And then when I think about that in a rate perspective, when you're talking about flat rates ex oil and gas - when I think about that going forward, I appreciate Q3 last year was painful in oil and gas, but your year-on-year comps get a lot easier particularly when we get into Q4, you should, hopefully, be flat overall or somewhere near it at a group level, if not positive.

Mark Irion

Correct. I mean, that's the expectation. I mean, it's a real difficult measure to forecast forward, just given the fact that it's a bit backward-looking measurement, so our expectation always is that we would be able to improve rates in Q3, especially in the oil and gas markets, and that's certainly the goal that we're setting ourselves. So it's a - you've got the two factors at play. You've got the drag coming off with oil and gas, and you've got the challenge of just getting lift in the non oil and gas markets.

Justin Jordan

Great. Thank you.

Operator

[Operator Instructions] Your next question comes from the line of Ross Gilardi from Bank of America Merrill Lynch. Your line open.

Ross Gilardi

Good morning, guys.

Mark Irion

Good morning.

Graham Hood

Hi, Ross.

Ross Gilardi

I'm just trying to understand a little bit more on why rate would improve in the second half of the year, I mean, if you're down 1% in the first half and you're guiding to minus 1% to plus 1%, I guess. You were already at the low end of the guide, but I guess when we're looking more broadly in the space, I mean, Caterpillar just put a 4% price declines for new equipment, which suggests there's got to be a lot of equipment out there, at least in the dirt-moving space, so why would rental rates improve if that's the case?

Mark Irion

Well, time - I mean, rental rates historically have a seasonal lift in Q2 and Q3. Time utilization improves, and that allows us to start pushing on rate. We compete with Caterpillar on the rental fleet, not on the used equipment sales, and that's not really a direct indication of rental rates, I don’t this the new equipment business, so it's a seasonal improvement. Our time utilization is high on a lot of categories, and that gives us the opportunity to challenge rate, but it's a competitive market and we will look for success, but we're not sure how much success we'll be able to get.

Ross Gilardi

And, obviously, United said they put up 50 basis points of sequential rate in May and 60 in June, or vice versa, but they got some pricing for the first time in a while in May and June. I mean, as far as you can tell, was that an industry dynamic, or did that seem more like a company-specific type issue? And also, kind of getting back to Justin's question, is that on access equipment versus dirt-moving equipment type dynamic, or do you think - even you guys said that you think pricing is kind of acting similarly across the categories, but - I'm not asking you to comment on United's rate, but does it resonate with what you're seeing in the overall industry?

Graham Hood

Well, I mean, if you look at our numbers specifically, I mean, our cadence was positive month over month in the quarter, and we were up sequentially from Q1 on rate by 3.7%, which we would expect to be on a seasonal basis, but looking at the cadence of the individual months in the quarter, we were positive month over month, so that gives us a little bit of confidence that we're moving in the right direction from a rate standpoint. And as time utilization improves, we think that sets the right rate environment for us to make an impact.

And obviously we're focused on it as a priority as a company, and then on top of that, we feel like we're in the right markets. We're small enough, we're nimble enough that we can get our hands around our pricing maybe quicker than some of our competitors can, so we've got a lot of things working in the right direction. And the macro environment is still very strong for us, so the environment is there to impact rate, and we're focused on it, and we hope we can do it in the second half.

Ross Gilardi

Great, guys. Thank you. And then just, lastly, could you just talk about the Florida construction markets right now and the markets that really matter most to you? I mean, by all accounts, Florida is still strong, but on the other hand, like on the residential side, maybe more in Miami, there’ve been - there seems to be a lot of anecdotal evidence that sort of the condo market is slowing, and maybe that's the dynamic of just the dollar being so strong and some of these emerging market currencies being so weak and foreign buyers just not being present, but are you worried at all about the Florida non-res markets starting to sort of tail off in the next couple of years after a period of just renewed strength over the last two or three?

Mark Irion

I mean, the Miami condo market is a pretty small part of Florida in general, and any of our equipment that was on rent there is long gone. We're sort of off those projects once the buildings get up to the second or third floor. So, no, the Miami market is continuing to be strong for us in other segments outside of the condos, and the rest of the state does continue to be very strong. The residential activity non-condo market is strong, and we don't really see any dramatic sort of slowdown in Florida for this year and don't have an indication as to why there would be a slowdown going into next year.

Ross Gilardi

Got it. Thanks very much, guys.

Mark Irion

Thanks, Ross.

Graham Hood

Thanks.

Operator

Your next question comes from the line of Tim Meissner from Goodwood Capital. Your line is open.

Tim Meissner

Hi guys, thanks for taking my call. I was just looking at your regions. You mentioned you had stronger demand in construction. Could you possibly share where you're seeing most of that demand come from?

Graham Hood

Yes, I mean, from a geographical standpoint, it's pretty broad-based, but we're primarily focused on infrastructure work, nonresidential construction and residential construction, as well as municipal construction, and all those markets have been strong for us on a year-over-year basis.

Tim Meissner

Right, so most of that's predominantly focused like Gulf Coast region?

Mark Irion

No, it's Southeast, U.S. Florida up through Washington DC are all very strong markets. The Gulf, actually, in the second quarter was challenged. I mean, you had flooding and bad weather again, so the Gulf region and Texas was a bit of a struggle in Q2 due to weather conditions.

Tim Meissner

Okay. All right, thanks, guys.

Operator

[Operator Instructions] Your next question comes from the line of Larry Pfeffer from Avondale Partners. Your line is open.

Larry Pfeffer

Good morning gentlemen.

Graham Hood,

Hi, Larry.

Mark Irion

Hi, Larry.

Larry Pfeffer

So, just kind of keeping on that topic on a regional standpoint, could you quantify the drag you saw from weather maybe in the Gulf Coast region? Obviously, there was flooding in Houston and wet weather in general, and you've had some competitors call out weather there more generally, but is there kind of a magnitude you can put on that?

Mark Irion

No, not really. I mean, it was wet last year as well, so the improvement you sort of see in the rest of the business is favorable weather, I think, year on year. So we don't really have a number for that impact, but obviously the flooding and that wet weather and the time it takes for construction sites to dry out had an impact on Q2.

Larry Pfeffer

Okay. And then looking at the rate guide, would the midpoint of the full-year range imply normal sequentials in the third quarter?

Mark Irion

Yes.

Larry Pfeffer

Okay. And then just, lastly, on the share repurchase program, obviously you've made a lot of progress here in the last couple quarters. Should we expect that to be pretty de minimis in the back half, or should we still expect a couple million dollars a quarter maybe on that number and maybe you finished it a little earlier than anticipated?

Mark Irion

I think you can expect it to be de minimis in the back half. I mean, there's an impact on the run up in the share price in terms of what we're buying back, but, yes, it should be less than what it was in the first half.

Larry Pfeffer

Okay. Thanks, Mark. Best of luck, guys.

Mark Irion

Sure. Thanks, Larry.

Operator

There are no further questions at this time. I will turn the call back over to the presenters.

Graham Hood

Thanks, operator. Once again, I want to thank everyone for being on the call today and for your ongoing interest in Neff. We look forward to talking to you again next quarter. Thanks. Have a great day.

Operator

This concludes today's conference call. You may now disconnect.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!