Strong revenue growth boosts Ashtead first quarter profits
Industrial equipment rental firm Ashtead has reported better-than-expected first quarter pre-tax profits of £155m, up 23%, driven by solid revenue growth in the US and UK
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Underlying revenue was up 20% to £539.6m, while earnings before interest, tax, depreciation and amortisation jumped to £283m from £209m in the same period last year.
Chief executive Geoff Drabble said the strong numbers reflected the company's diversification strategy, with its US Sunbelt arm delivering a 23% increase in revenue and its UK division also performing strongly.
“Particularly encouraging is that, after a weather-impacted Spring, our seasonal improvement in demand was very strong, resulting in record levels of physical utilisation in July on a fleet that was 26% larger,” he said.
“With both divisions performing well, strong end markets and our strategy clearly working, we expect full year results to be in line with our expectations and the board looks forward to the medium term with confidence."
Drabble said Ashstead invested £349m in capital expenditure in the period, opened 19 greenfield locations and made one small bolt-on acquisition.
“We are therefore very much on track to achieve our plans of mid to high teens fleet growth in the US and open 50 new locations in the full year. We continue to invest and grow responsibly, generating strong returns and maintaining leverage within our stated objectives,” he added.