Ashtead profits and revenue rise as acquisitions boost growth
Equipment rental firm Ashtead Group has reported another quarter of solid growth, putting its annual profits and revenue well ahead of last year.
The FTSE 100 company said it had seen revenue rise 17% in the three months to April 30, coming in at £1.1 billion.
Pre-tax profits were also higher, climbing 10% to £208.6 million.
It rounded off a year of growth for Ashtead, with revenue for the full year 19% higher at £4.5 billion.
Pre-tax profits jumped 20% to £1.06 billion.
Chief executive Brendan Horgan said the company’s performance had been boosted by investment and acquisitions.
“We continue to experience strong end markets in North America and are executing well on our strategy of organic growth supplemented by targeted bolt-on acquisitions,” he said.
“We invested £1.6 billion in capital and a further £622 million on bolt-on acquisitions in the period, which has added 146 locations across the group.”
The board said it had “confidence” in the medium term, and expects a similar level of expenditure in the 2019-2020 financial year.
Ed Monk, associate director from Fidelity Personal Investing’s share dealing service said: “The company’s biggest market by far is the US, where trading has been strong.
“Increased activity relating to hurricane’s Florence and Michael added to the numbers, although clean-up operations were smaller in scale than last year when Irma struck.
“For investors, a 21% increase in the dividend will be welcome after recent falls in the share price. Ashtead is currently allocating a lot of capital to acquisitions with a whole stream of purchases of regional rental firms in the US and Canada this year, and that appears to be paying off.”
It marks a bumper set of results for Mr Horgan’s first time in the hot seat, having taken over as chief executive in May.
He succeeded Geoff Drabble, who retired last month after 12 years with the business.