TOP NEWS: Ashtead set to beat expectations after quarterly profit dip

(Alliance News) - Ashtead Group PLC on Tuesday said its profit declined slightly in its financial ...

Alliance News 2 March, 2021 | 10:24AM
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(Alliance News) - Ashtead Group PLC on Tuesday said its profit declined slightly in its financial third quarter, fighting against the tough market caused by the Covid-19 pandemic.

Shares in Ashtead were down 1.5% at 3,957.87 pence in London in morning trading.

The London-based global equipment rental company posted a GBP210.1 million pretax profit for the three months ended January 31, dipping 6.6% from a GBP225.0 million profit a year before.

Quarterly revenue fell 3.2% to GBP1.21 billion from GBP1.25 billion, including a 3.6% drop in rental revenue to GBP1.08 billion from GBP1.12 billion.

For the nine months to January end, pretax profit fell to GBP716.3 million from GBP885.2 million as revenue fell to GBP3.76 billion from GBP3.93 billion.

Ashtead said: "While trading volumes were lower than last year as a result of the pandemic, this has been mitigated, in part, by emergency response efforts throughout our business but particularly within our specialty businesses. The degree of impact on volume varied significantly across our geographical markets and correlated to the severity of infection rates and associated market level restrictions.

"Activity levels have increased consistently through the period such that fleet on rent is now broadly in line with prior year in the US, slightly behind in Canada due to the recent lockdown in Ontario and higher in the UK."

The company paid an interim dividend of 7.15 pence per share, flat year-on-year, for its financial year ending April 2021.

For its financial year as whole, Ashtead is expecting capital expenditure at the upper end of its previous guidance, approximately GBP700 million. Looking further ahead, it forecasts a return to growth in financial 2022 and expects gross capital expenditure of between GBP1.3 billion and GBP1.5 billion, enabling mid-single digit revenue growth in the US.

Chief Executive Brendan Horgan said: "The strength of our business model and balance sheet positions the group well in markets that are likely to remain uncertain. With our businesses performing well, we now expect full year results ahead of our previous expectations. The benefit we derive from the diversity of our products, services and end markets, coupled with ongoing structural change, enables the board to look to the future with confidence."

By Anna Farley; annafarley@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Ashtead Group PLC 4,675.00 GBX 0.80

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