Ashtead Group PLC, parent to US-based Sunbelt Rentals, reported higher profit and revenue for the fourth quarter of its last financial year and for the year as a whole, as it invested in expanding its fleet and in acquisitions.
The company reported a pretax profit of GBP70.8 million for the three months to April 30, up from GBP50.0 million a year earlier, as revenue rose to GBP355.7 million, up from GBP306.8 million. For the year to end-April, pretax profit rose to GBP365.5 million, from GBP214,2 million, as revenue rose to GBP1.48 billion, from GBP1.21 billion.
Ashtead's performance reflects its investments in revamping its rental fleet and growing organically and through bolt-on acquisitions.
"2013/14 was a very successful year for the Group, enabling us to deliver record 12-month underlying pre-tax profits of £362m, up 50% from the prior year," said CEO Geoff Drabble. "It is particularly pleasing that we achieved this growth whilst also delivering on our long-stated commitments of return on investment progression, now 19% for the Group, and maintaining debt leverage below two times EBITDA."
"Our performance reflects the benefits of the consistent execution of our strategy focused largely on organic growth, supplemented by greenfield openings and bolt-on acquisitions. We invested £741m in our rental fleet and a further £103m on acquisitions during the year. We anticipate growing our fleet in the coming year in the low to mid teens percent range and will continue to open greenfields and make bolt-ons to further grow our market share and profitability. Current planning suggests around 50 new locations in the new financial year, another measured step towards our medium term objective of 600 locations," he said.
Capital expenditure for the last financial year was GBP741 million gross and GBP642 million net of disposal proceeds, and this meant its rental fleet at the end of April at cost was GBP2.6 billion with an average age of 28 months, down from 32 months.
"As always, our capital expenditure plans remain flexible depending on market conditions and currently, our principal focus is on fleet deliveries through the first quarter of fiscal 2015," Drabble said.