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

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