Record first-half results at equipment rental group Ashtead, parent to Sunbelt Rentals, are once again a result of continued powerful growth from the US building sector.
Ashtead grew pre-tax profits 49% to £212m in constant currencies on revenues up 23% to £439.2m in the six months to October 31st, driven by 21% growth from US arm Sunbelt in the second quarter.
Document: Ashtead Q2 13-14 Results Presentation
With earnings per share up 44% to 14.3p per share, or 52% on an underlying basis, analysts consensus forecasts were beaten by 6%.
"The momentum within the business continued through the second quarter, resulting in record half year pre-tax profits of £212m, up 49% from the prior year," said Ashtead Chief Executive Geoff Drabble. "Once again, Sunbelt in the US was the main driver of our growth but it was pleasing to see another strong performance from A-Plant."
He continued, "Our strategy continues to be focused largely on organic growth, supplemented by a range of bolt-on acquisitions. We invested a net £401m in our fleet during the first half and a further £61m on acquisitions. However, at the same time, our strong margins allowed us to reduce leverage to 2.1 times EBITDA.
"Activity on the ground and lead indicators remain very healthy and, as a result, we have increased our full year capital guidance to £700m to support our customers during an anticipated strong Spring of 2014. As a result, we now anticipate a full year profit towards the upper end of current expectations and the Board looks forward to the medium term with increasing confidence."