Ladies and gentlemen, thank you for standing by. Welcome to the Hertz Global Holdings Fourth Quarter and Full-Year 2013 Earnings Conference Call. The company has asked me to remind you that certain statements made in this call contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of performance and, by their nature, are subject to inherent uncertainties. Actual results may differ materially. Any forward-looking information relayed on this call speaks only as of this date, and the company undertakes no obligation to update that information to reflect the changed circumstances. Additional information concerning these statements is contained in the company's press release regarding its fourth quarter and full-year results issued this morning and in the Risk Factors and Forward-Looking Statements section of the company's 2012 and 2013 Forms 10-K and 2013 Form 10-Q quarterly reports. Copies of these filings are available from the SEC, the Hertz website or the company's Investor Relations department. I’d like to remind you that today's call is being recorded by the company and is also being made available for replay starting today at 12:30 PM. Eastern Time and running through April 1, 2014. I would now like to turn the call over to our host, Leslie Hunziker. Please go ahead.

Good morning. You should all have our press release and associated financial information. We've also provided slides to accompany our conference call that can be accessed on the IR page of our website. Today, we'll use certain non-GAAP financial measures, all of which are reconciled with GAAP numbers in our press release and at the back of the slide presentation, both of which are posted on our website. We believe that our profitability and performance is better demonstrated using these non-GAAP metrics. Our call today focuses on Hertz Global Holdings Incorporated, the publicly traded company. Results for the Hertz Corporation differ only slightly, as explained in our press release. With regard to our IR calendar, we'll be next presenting at the Bank of America Merrill Lynch Auto Summit in New York City on April 16, and then Wells Fargo Industrial and Construction Conference on May 8 also in New York City. This morning, in addition to Mark Frissora, Hertz's Chairman and CEO; and Tom Kennedy, our new Chief Financial Officer; on the call, we have Scott Sider, Group President of Rent-A-Car, The Americas; Michel Taride, Group President of Rent-A-Car International; and Lois Boyd, Group President of Hertz Equipment Rental Corporation. They'll be on hand for the Q&A session. Now I'll turn the call over to Mark.

Good morning, everyone, and thanks for joining us. Let me start by welcoming Tom Kennedy to the earnings call. As you know Tom joined Hertz in mid-December as our new Chief Financial Officer based in Naples. With his compatible industry background having worked at Northwest Airlines, Vanguard Car Rental which owned National and Alamo and most recently Hilton. Tom was able to hit the ground running on day one. He’s already made a big contribution. I look forward to having you meet him when we are on the road next. This morning, I am going to give you a quick overview of our 2013 performance on Slide 5. We continue to successfully drive both record revenue and earnings growth by leveraging industry leading rental car brands, capitalizing on strategic acquisitions, penetrating new markets and equipment rental, and being relentless on efficiency programs and cost management. As a result, you can see on Slide 6 that in 2013 we increased revenue 19% while operating expenses as a percent of revenue decline slightly driving margin expansion. On a consolidated basis adjusted pretax income and corporate EBITDA rose 29% and 26% respectively. In 2013, Donlen, the equipment rental business and International Rental Car all performed in line with our expectations, hitting our profit targets in each business respectively. Unfortunately, the U.S. rental car operation wasn’t able to overcome the burden of carrying too much fleet in the fourth quarter, which caused us to miss our earnings guidance last year. If you turn to Slide 7, as we previously discussed in detail, after experiencing negative volume growth impacted by the sequester for the Hertz brand on airport in the third quarter, we went into October significantly over-fleeted, but we made the conscious decision to try to rent some of these cars rather than sell…

Thanks Mark, and good morning everyone. Having joined Hertz – the Hertz team recently, I want to say how excited I am to be here today and how much I look forward to closely working with you all. Before we look at the numbers, I also want to reiterate Mark’s earlier comment that the challenges the company faced during the fourth quarter were unusual and temporary in nature and that we already have a fix in place. We’ve identified and started to implement actions in 2014 to improve our yield management and fleet optimization capabilities that I believe will better position the company as the year progresses. And as Mark highlighted, the excess fleet situation is nearly behind us. With that, let me run through some details of the fourth quarter starting with the U.S. Rental Car results on Slide 10. Fourth quarter revenue was up 14% from last year driven by a 16% increase in volume, despite the government sequester and associated 16-day shutdown that occurred in October. The higher transaction days benefited from incremental volume and synergies related to Dollar Thrifty acquisition, 75 net new off-airport locations, and expanded penetration of existing insurance accounts. Insurance and placement volumes were up 8% year-over-year on a tough year-over-year comp due to Hurricane Sandy in 2012. Total revenue per day in the quarter was down 1.4%, primarily due to the temporary over-fleeting and the mix issue we already discussed. As Mark pointed out, however, we are encouraged by the fact that our Hertz Classic brand maintained its positive price performance on the airport during the fourth quarter with a 60 basis point improvement. Turning to Slide 11 for the U.S. rental car business, adjusted pre-tax margin was impacted by lower fleet efficiency as well as increased labor and logistic costs as…

Thanks Tom. And let’s move to Slide 18. We made substantial progress towards our strategic priorities including integrating Dollar Thrifty, co-branding Hertz with the Hertz market share leader in China, transforming Europe and growing rapidly in U.S. off-airport, Donlen Leasing and equipment rental. While our strategies are on track and their potential is as robust as ever we’re resetting our financial performance targets for 2014. Our guidance reflects a more conservative approach based on our earnings sensitivity outlined on Slide 19. For example, based on a 1% change in U.S. rental car residual values, we could have as much as an $83 million opportunity or headwinds pretax profits versus our forecast. We expect to be able to tighten the guidance range, as we get more visibility during the year. If you turn to Slide 20, I’ll run through some of the assumptions behind our initial guidance. For 2014, we expect U.S. and international rental car revenue to increase 6% to 8% and 5% to 7% respectively year-over-year. We believe Europe will continue to deliver steady growth, as it’s economy stabilize and we further penetrate the market value – the full value market with new Thrifty and Firefly locations. In the U.S. we are planning for another year of double-digit volume expansion in the off-airport market as our insurance replacement operation builds on last year’s growth and captures a greater share of existing account business. In fact, Hertz has recently expanded its position with one of the largest insurance carriers in the U.S. being upgraded to its primary rental car vendor. On the U.S. airport, we now have 22 Firefly locations open in the top leisure destinations across the country that will drive incremental volume and adding Dollar Thrifty to our corporate and commercial partnership agreements will further boost the top…

(Operator Instructions) Brian Johnson with Barclays. Please go ahead. Brian Arthur Johnson – Barclays Capital, Research Division: Yes. Good morning.

Good morning. Brian Arthur Johnson – Barclays Capital, Research Division: Just kind of sticking to the current business, can you give us a sense as you kind of roll from 2014 to 2015, just broadly how you are thinking about depreciation, and should we think about it stepping down or stepping up year-over-year?

Well, I guess in terms of the Black Book, which is what we kind of use as stakeholder, we had a January depreciation reduction based on Black Book, which forecast out through January of next year. We feel that the market is pretty stable in the current, and it’s actually -- that Black Book is actually probably negative kind of versus what we’re seeing in the marketplace right now, but we’ve assumed that negativity in our current guidance so that we’ve accounted for -- the forecast what we seen in 2015 or 2016, Brian, you’re guess is as good as mine, I mean, so in terms of the -- with the marketplace going to prove to be, obviously it will be impacted by the OEMs and what their behaviors is, it will be impacted by the off lease as well, the off lease supply base, what happens in off lease in 2015 and 2016.

Our next question is from Afua Ahwoi with Goldman Sachs. Please go ahead. Afua Ahwoi – Goldman Sachs Group Inc.: Thank you. Just two questions for me. First I think, sticking to the – following up a little on that first question. I think you answered it a little bit, but when you talked about truing up the -- moving from the $250 to $260 for 2014 fleet car guidance, I think you indicated that some of it was market conditions, but I was going to point out that I thought the Manheim actually has been quite stable. So maybe if you can sort of bridge that gap for us, how the numbers still moved up. And then the other part I was also curious was, could you give us an idea on maybe how much the mix impact will have on the reported price , and I think it's great color to give the Hertz Classic brand, but obviously the reported number will be lower, so maybe an idea of the impact so that we can think about it as we model. Thanks.

Yes. Again going back to Manheim versus Black Book, Manheim is just current – you are seeing current market conditions which we believe have been favorable compared to our expectations, which is good, but Manheim does not predict the future. They do have future predictors, but we use again Black Book, which indicated in January, third week of January that there was going to be a decline. So, again, we basically forecasted that decline in our depreciation rate, but we’re hopeful that they are wrong obviously. I mean, the hope is that the Black Book is wrong, but we modeled it into our depreciation curve anyways. So, again, we have a lot of offsetting factors as you know on retail. We are beating our plan right now on the retail sales levels and retail has been strong for us. So we have a lot of offsetting factors as well, but that’s pretty much kind of sums up where we are on residual risk. We think we’ve made the right moves. We looked ahead to see what we think the worst case scenario is, and we’ve built that into our current $60. So there is, obviously when we look at mix on the pricing side, in general we see anywhere from 120 to 150 basis points range of mix adjustment on an ongoing basis, it kind of ranges, but that’s roughly what it is, on an ongoing basis 120 to 150 basis points. Next question?

And that’s from the line of Michael Millman with Millman Research. Please go ahead. Michael Millman – Millman Research Associates: Thank you. I just have two questions. First is, if previously you had talked about the $3 number for 2015. Could you talk about or quantify some of the factors assuming the companies were together as to why you don't see the B post to that at this point. And secondly regarding the price you indicated, U.S. Rent-A-Car price that you've put in a couple of increases. Avis has talked about continuing increases. ERAC has followed suit. Why would we expect to see even greater increases than you’ve expected considering that ROI seems to be well below where the industry should be or at least believe that it could be?

Yes, so Michael on the $3 number that was, a year ago, and that was when residuals were at a different point in our history and volume, we didn’t have the third quarter volume impact, so obviously the [$3 in ’15] changes in terms of timing. So we still are focused on the same kind of positive returns out of existing buying levels, so our margin assumptions really haven’t change since we talked to you guys back then in the April time period, but obviously the buying assumptions had changed and that drives obviously a longer period time before we get that $3 number. In terms of just looking at the overall pricing environment, I think we pretty much put out there in the investor sides that we are seeing the very strong pricing environment, and we have been initiating price increases ourselves historically. We never talk perspectively about pricing though because we think that’s not the right thing to do. But historically in the last couple months, we’ve seen a very strong pricing environment and I would expect that with any pressure on fleet costs which probably will continue to be some, that the pricing environment will remain strong on that basis but more importantly we will finally have our systems really integrated during the second quarter. We think, we are going to drive large amounts of capacity takeout. We are going to be driving utilization up in the back half of the year, and as that utilization goes up, we are taking cars out of the market, essentially we are taking capacity out of the market and being their leading off-airport brand that will help, we think, airport pricing dramatically. We believe that Hertz, the reason we tell you that Hertz is a good indicator because that is the umbrella, that’s the price leader and other brands can follow up underneath that price leader. It represents over half our volume in the entire U.S. market. So it's roughly – I'm giving you rough numbers, but anywhere from $3.3 billion to $3.4 billion business is the Hertz Classic brand on airport. So we think that’s a really good bellwether that’s clean, it is a very clean number on what pricing is doing, and to have that up 250 basis points already to February on top of last year being up 500 basis points, I think it’s a fairly strong indicator we think the pricing environment is strong.

Our next is from Hamzah Mazari with Credit Suisse. Please go ahead. Hamzah Mazari – Credit Suisse: Good morning, thank you. Just a two-part question, the first question is just on the spend, could you maybe talk about your ability to potentially buyback stocks sooner versus wait for the spin transaction to take place, as well as maybe how investors should think about additional information, the Management team of HERC, potential share distribution. How we should think about the timing of additional information coming through. And then lastly, second question, if you could just give us a sense of how the incremental synergies from DTG ramp up and how we should think about what else is remaining there? Thank you.

I think you asked six questions. So I’ll try to just answer a couple, all right. So, obviously we believe that we will be opportunistic in the marketplace when comes to share buyback. We indicated in our script to you that we were looking to opportunistically take the $2.5 billion and have $1 billion of it and execute that in the near term. But we could go up to 20% of the shares of the new company, which would indicate that would be higher than $1 billion, again, post separation. So that was our commitment, anything other than that, we haven’t really talked about it from a timing perspective, but we will be opportunistic based on marketplace condition, this was I can answer that question. In terms of more info on the management team, we’re going to be giving you that information as we get closer to the spin. Obviously, this is a recent event, we didn’t want to talk to investors and so we knew that we had IRS approval. And so, as we’ve been working through these issues for the last since last spring, it’s been a very posi-momentum project, but we’re going through all of the issues, we’re ready to make the announcements for leadership we will be sure to be real-time in that communication.

Our next question is from Adam Jonas with Morgan Stanley. Please go ahead. Adam Jonas – Morgan Stanley: Hey, thanks everybody. So first a question on your new corridors for leverage and the new visibility after the reformation of the company. Can you confirm that that does not change in any way your growth ambitions for taking market share off-airport, in particular the insurance replacement business? And just as a follow-up housekeeping, you provided some residual value sensitivity in your slide deck on page 22, I believe it was – page 19, excuse me, that said that a 1% change in residuals was an $83 million impact on pretax profit and that was about almost four times the magnitude of the $23 million sensitivity on Slide 30 of the capital markets day deck. I was just wondering how we can reconcile those very large differences in that sensitivity. Thanks.

Okay. In terms of – I wanted to answer the previous caller their question on DTG incremental synergy cadence, we put $120 million in revenues in 2014 and $100 million in costs in 2014. So on the DTG revenue side, it’s $120 for revenues, it’s $100 we built in the guidance for costs, just so you have that.

Okay. And I can address the residual bridge for you. The number the company used last year that was based on the car sold in the period as opposed to the $83 million is impacting the entire rental car fleet. So that was a segment analysis that was provided previously and based on car sales, and two factors. One is that the total company now has sensitivity, so you can really model against the entire fleet, and it’s on current market conditions as well in the Black Book that Mark referred to earlier. So there are really kind of two dynamics that have changed. The volume dynamic, number of fleet, and its current market versus what the market was prior distribution of that sensitivity.

And next to Chris Agnew with MKM Partners. Please go ahead. Christopher Agnew – MKM Partners LLC, Research Division: Thanks very much. Good morning.

Morning. Christopher Agnew – MKM Partners LLC, Research Division: I was wondering if you could talk a little bit more about the pricing optimization tool and the DTG system integration in general. Where are you with it? What do you expect the benefits to be? And how soon do you anticipate seeing them? And then very quickly, just are there any restrictions in buying back stock because of the spin? And do you intend to buy back stock this year? Thanks.

Okay. So in terms of Dollar Thrifty integration, this again going very well, it’s ahead of our internal plan. We’ve – as I mentioned to you just a minute ago, what we expect to have in our guidance for this year, we gave the DTG numbers. The migration itself is going on right now, I mean, we’re doing the migration. We’re rolling out in April a complete revision for all the pricing, but we’re also migrating the counter systems as well. We’re doing tests in April on the counter systems. And so the pricing will be done if you will, the pricing integration is done at the end of this month. But the actual counter systems and the financials for DTG will be done over the next couple of months. But we’re actually testing it if you will in different airports and different areas during the month of April and May. The idea is that by June, we can – June, July time period kind of go 100% live with all locations. But we want to make sure, we test this with really a lot of belts and suspenders making sure that, we run full tests in parallel systems as we move forward with this in the short-term over the next couple of months. There was another question that you had asked, restrictions on share purchases. I guess the only restrictions that we have is the fact that, with the ruling that we have, but we can't buy more than 20% of our outstanding shares. Other than that, there are no restrictions, so it's just market timing and sources and use of capital.

Yes. Chris, it's a very specific technical matter, you can't have a plan or intent to acquire more than 20% of your shares and that's why, it's clear in our release that why that we set that standard.

Our next question is from Rich Kwas with Wells Fargo Securities. Please go ahead. Richard Michael Kwas – Wells Fargo Securities, LLC, Research Division: Hi, good morning everyone. Just Mark, just going back to the earlier question about the mix adjustment, so if Hertz classic is up 1% and that's the assumption for the year, but the mix can be 120 to 150. That would imply that the US RPD – the assumption in the guide is kind of flattish all-in, maybe down slightly. First, is that accurate? Second, off-airport was down 2.8% in the quarter. Any dynamics going on there with your chief competitor? And then finally, the assumption – could you give us the assumption in terms of the mix of retail units sold behind the $260 depreciation per unit per month guidance? Thanks.

Okay. So let’s start off with the question relating to the first part, which is your RPD mix. You are right, I mean, we are essentially is modeling flat pricing into the – into our model as we normally do, so again that's kind of the assumption in the model for this year. And again, we believe there is obviously upside for that given what we’re seeing in the marketplace, what we have seen and given the fact that where we are going to be taking capacity out of the airport. So, again, we are bullish on pricing and but we put 0% into the – 0% overall for all brands into the mix. In terms of the air – off-airport pricing, remember that we’re getting bigger shares of the insurance replacement businesses. You remember that off-airport is three segments, so we have a little bit of a mix shift going on in off-airport frankly. There is leisure, there is local commercial business, and that’s the insurance replacement. We’ve been growing share in the insurance replacement segment and that's contracted at a rate that's lower than let's say, the local business is or the commercial business locally. And because that rates are little lower, it’s still very profitable, of course, very contributory, and we serve it, as you know with smaller cars. And so it’s positive that the growth rate is there, but it does have a mix shift and make the rate look a little lower than what it really is in the different segments, because when we look at the retail segment, for example, we're pretty bullish on the pricing in the retail segment, the walk-up traffic that we get in those stores that we're expanding this year. So overall, it's – if you mix adjust it, I would – couldn’t give you the actual number today but maybe we will look at doing in the future, but we're not really worried about the rate if you will. It's not because we're entering into kind of a pricing issue with our competitor there.

We’ll go next to John Healy with West Coast Research. Please go ahead.

Thank you. Just a few quick questions, Mark I was hoping maybe you could take a step back and kind of remind us of where you were back in November with the fleet issue in terms of units that you felt you were over-fleeted in the US. And maybe kind of in a real-time of where you are at as of the middle of March and kind of how you've moved through, what channels you've moved that fleet? And then additionally I was hoping to get a little color on the free cash flow guidance. Any color you could give us in terms of contribution to that free cash flow from the RAC division as well as the HERC division?

So where we were in November versus where we are now is a world of difference. We are actually ahead of plan. We’re right fleeted right now. So we actually today are right fleeted. We actually have more demand than we have fleet. So we feel really good about how tight we are right now. We also – versus November, where we were still in the middle of being significantly over-fleeted right in the middle of it. So I guess the characterization, it's kind of night and day where we were in the fourth quarter but where we are now in the quarter. On January and February as I mentioned to you those are problematic months, but we’ve been able to get the fleet and demand aligned and so that we’re ahead of schedule from what we told investors back last year when we said it would take us six months to work through this through the end of March. So we're a little bit of head of schedule on that – on fleet utilization. Cash flow for HERC versus RAC outlook, we have disclosed that publicly. We're going to be working on that obviously as we fine-tune the models and separating the company, we’ll be happy to buy that to you in the future.

And the free cash flow increase I think was also your question, that’s primarily driven by higher earnings, so that’s what’s driving the increase on year-over-year.

And our next question is from Yilma Abebe with JPMorgan. Please go ahead. Yilma Abebe – JPMorgan Securities LLC: Thank you. Good morning. My first question is, it seems like with the new leverage target of 2.5 to 3.5 times you are moving away from your investment grade aspirations. Is this a temporary move away from that financial policy or are you permanently taking investment grade ratings off the table, one? And then secondly, if you can perhaps talk about, if it's not too early, what debt you'd like to pay down.

Yes. I can address that. We did a lot of work and analysis of that investment grade target relative to being close investment grade relative to our cost of capital. And we concluded the cost of getting to investment grade relative to the rewards you get on our cost of capital really was not worth it. And we concluded that being kind of a high BB – mid-BB range is really our optimal cost of capital, and that’s where we are – that’s how we set our leverage ratios. So, with this transformational event, it kind of created a platform for us to reconsider that position and reset kind of our capital structure and our investment targets that we feel now very comfortable with. As far as what was the second part of your question excuse me? We haven’t really – we’ve done some preliminary modeling, the likely is the term loan that we would pay down. And that’s in the LIBOR plus what currently in the LIBOR plus 225 range to 275 range with some LIBOR floors in terms of 75 to 100 basis points. So we would look to pay down that term loan most of it if not all of the term loan as part of the distribution that would come from HERC, and then would used to fund the dividend and pay down that debt.

And next go to Kevin Milota with JPMorgan. Please go ahead. Kevin M. Milota – JPMorgan Securities LLC: Thank you for your time. Looking at page 30, you have the assumption of $1.7 billion to $1.75 billion in corporate EBITDA for 2015 for the RAC business. Just to confirm, that's assuming no incremental pricing, and maybe if you could give some of the drivers behind that 2015 number?

Yes, I think it’s fair to say no incremental pricing, it’s conservative approach in terms of volume assumptions as well. So we really tried to put a belt and suspenders on both our fleet depreciation guidance as well as our volume guidance as you know by making sure we have that conservatism we’d better book-end things for investors. So we feel pretty good about that number, felt like the way we arrived at it was through prudent kind of – prudent assumptions around each segment of our volume and around kind of a flattish pricing environment, which we believe will be actually positive.

We have a follow-up from Rich Kwas with Wells Fargo Securities. Please go ahead. Richard Michael Kwas – Wells Fargo Securities, LLC, Research Division: All right. Just a follow-up on the retail mix of the dispositions this year, Mark, I think last year the target for 2014 was about 30%. Is that embedded in the $260 per unit per month 30%?

We don’t – okay, so right now in 2013, retail and rent-to-buy were 15%, we expect 2014 to be at 30%. Like I said, we are beating our plan pretty hardly right now. The retail environment continues, I mean, we’re going to be able to beat it, will help our depreciation obviously. We are selling as I said, we sold 27,000 units and if you can imagine a 64% increase on that it's pretty large. And it does give us some cause to be a little optimistic about things. So 30% is the 14 goal. We hope – we had on average probably about 30 stores open – 35 stores open last year. This year we'll finish the year, how many stores. 125 and today we have 65 stores open. So its 65 stores open and we’re getting a lot more throughput for per store as their open, then we anticipate we also getting a lot higher margins than we anticipated with F&I. And that's very helpful for us as we continue to make sure we build up insurance against any kind of residual risk.

And we’ll go to Adam Jonas with Morgan Stanley. Please go ahead. Adam Jonas – Morgan Stanley: Hi, thanks just wanted to follow-up on the first part of my question, just to confirm that the changing views of leverage and credit rating in your outlook that that will not change your previously stated ambitions to grow the off-airport market share, and in particular, the insurance replacement market share. Thank you.

No, I mean that our capital structure was designed with sufficient cash flow to fund all of our CapEx needs for our growth plan and we see no – we've got lots of headroom we think capacity for investments and other strategic initiatives if we chose to pursue them so we are very comfortable with that leverage range and still fund the growth initiatives that we have in our plans.

And that will conclude the Q&A session. I'll turn it back to the presenters for any closing comments.

Great. Well listen we are excited about our prospects for the future. We hope investors feel good about the upside for the Company. We certainly feel good about all of our market conditions. Going forward and the team is very motivated to making sure that we exceed investor expectations as we move forward. So thanks for joining us on the call today.

Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation. You may now disconnect.