TOP NEWS: Ashtead Raises Dividend As It Plans GBP500 Million Buyback

(Alliance News) - Ashtead Group PLC on Tuesday lifted its total payout for 2019 financial year ...

Alliance News 18 June, 2019 | 8:58AM
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(Alliance News) - Ashtead Group PLC on Tuesday lifted its total payout for 2019 financial year and said strong demand in its core US market supplemented by targeted bolt-on acquisitions led to a year-on-year rise in earnings and revenue for the period.

The equipment rental firm also said it continues to look to the medium term with confidence and expects to return up to GBP500 million via share buybacks in 2020 financial year. The company has returned GBP675 million via share buybacks since December 2017.

Shares in the FTSE 100 listed company were trading 1.2% higher at 1,985.50 pence each in morning trade, the second best performer in the FTSE 100 on Tuesday.

For the year to April 30, the company recorded pretax profit of GBP1.06 billion, up 23% from GBP862.1 million in the year ago period on a revenue of GBP4.45 billion, which was up from GBP3.71 billion in 2018. Rental revenue increased year-on-year to GBP4.14 billion from GBP3.42 billion.

On an underlying basis, annual pretax profit totaled GBP1.11 billion versus GBP927.3 million a year ago.

Company-compiled consensus from 20 analysts had adjusted pretax profit for the year at GBP1.10 billion and revenue at GBP4.41 billion.

"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. We invested GBP1.6 billion in capital and a further GBP622 million on bolt-on acquisitions in the period, which has added 146 locations across the Group," said Chief Executive Brendan Horgan.

Ashtead, which rents out construction and industrial equipment, said its core Sunbelt US division recorded revenue of GBP3.82 billion for 2019 financial year versus GBP3.10 billion a year ago. Earnings before interest, taxes, depreciation and amortisation of the division grew to GBP1.88 billion from GBP1.54 billion.

Sunbelt Canada recorded GBP200.2 million in revenue versus GBP130.6 million and the unit's Ebitda increased to GBP72.2 million from GBP39.9 million.

The company's UK unit, A-Plant posted revenue of GBP475.1 million for 2019 financial versus GBP471.7 million. Ebitda grew to GBP168.4 million from GBP167.3 million.

Ashtead declared a final dividend of 33.5p per share. The firm's total payout stood at 40.0p, up from 33.0p paid a year ago - also beating the 38.1p estimated by the market.

Capital expenditure for 2019 financial year stood at GBP1.59 billion gross and GBP1.39 billion net of disposals.

"Our business continues to perform well in supportive end markets. Looking forward, we anticipate a similar level of capital expenditure in 2019/20, consistent with our strategic plan. So, with our business performing well and a strong balance sheet to support our plans, the Board continues to look to the medium term with confidence," Horgan said.

By Tapan Panchal; tapanpanchal@alliancenews.com

Copyright 2019 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article
Security Name Price Change (%) Morningstar Rating
Ashtead Group PLC 2,171.86 GBX -0.28 -
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