Ashtead shares rocket on full year profit outlook after Q3 impresses

Shares in Ashtead Group, the equipment rental group, leapt on Tuesday after the company unveiled a 173 per cent rise in third quarter pre-tax profit and revealed full year profit is now expected to be ahead of its earlier predictions.

Shares in Ashtead Group, the equipment rental group, leapt on Tuesday after the company unveiled a 173 per cent rise in third quarter pre-tax profit and revealed full year profit is now expected to be ahead of its earlier predictions.

The FTSE 250 listed firm said revenue rose 26% to £333.9m (Q3 2012: £271.3m) during the three month period to the end of January, while pre-tax profit rocketed 173% from £20.6m to £53.8m. Earnings per share (EPS) soared climbed to 6.9p from 2.7p.

For the nine months ended January 31st, revenue climbed 19% to £1,014.3m, pushing pre-tax profit up by 85% from £105m to £194.5m, and EPS to 24.6p from 13.3p for the same period the prior year.

EBITDA for the three months totalled £121m, up from £85.8m a year earlier, and for the nine month period came in at £396.8m, compared to £292.4m previously.

Ashtead's Chief Executive, Geoff Drabble, commented: "It is pleasing to report another quarter where strong revenue growth and ongoing operational efficiency have delivered record nine month profits of £194m. With this momentum clearly established in the business, we now anticipate a full year profit ahead of our earlier expectations.

"To further support ongoing market opportunities, we plan to pull forward around $100m of fleet expenditure previously planned for fiscal 2014 into the fourth quarter of this year. This will have no impact on our stated intention to sustain leverage below two times.

"With a broad range of metrics already at record levels at this stage in the cycle, together with a strong balance sheet to support medium term growth opportunities, the board looks forward with confidence."

The share price rose 8.1% to 567p by 11:10 on Tuesday.

NR

Recommended

Share tips of the week – 15 October
Share tips

Share tips of the week – 15 October

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
15 Oct 2021
Trading: stash the family cash in this cheap wealth management firm
Trading

Trading: stash the family cash in this cheap wealth management firm

Wealth management is a growth market. Rathbone Brothers should be a prime beneficiary – and looks cheap. Matthew Partridge explains the best way to pl…
12 Oct 2021
What the best-performing investment trusts of the past 20 years can teach us
Investment trusts

What the best-performing investment trusts of the past 20 years can teach us

Forty-two trusts have risen more than tenfold over the last two decades. What made the winners stand out? And how can we identify future outperformers…
12 Oct 2021
Activision Blizzard: a cheap play on videogames
Share tips

Activision Blizzard: a cheap play on videogames

Videogame maker Activision Blizzard has been in the news for the wrong reasons lately. But it has a bright future, says Stephen Connolly.
11 Oct 2021

Most Popular

How to invest in SMRs – the future of green energy
Energy

How to invest in SMRs – the future of green energy

The UK’s electricity supply needs to be more robust for days when the wind doesn’t blow. We need nuclear power, says Dominic Frisby. And the future of…
6 Oct 2021
Inflation is still one of the biggest threats to your personal finances
Investment strategy

Inflation is still one of the biggest threats to your personal finances

Central bankers and economists insist inflation will be gone by next year. We're not so sure, says Merryn Somerset Webb. So if you haven’t started to …
1 Oct 2021
How to invest as we move to a hydrogen economy
Energy

How to invest as we move to a hydrogen economy

The government has started to roll out its plans for switching us over from fossil fuels to hydrogen and renewable energy. Should investors buy in? St…
8 Oct 2021