Ashtead raises full-year expectations after strong H1

Ashtead, the plant hire group, expects full-year profits to be "substantially ahead" of expectations after seeing its underlying pre-tax profit soar nearly 200% for the first half ended 31 October.

The firm, which generated underlying revenues of £575.5m, up 24% on the same period the previous year, made a pre-tax profit of £84.4m, compared to £30m the year before, marking a 197% increase.

On a quarterly basis, revenue was up 27% at £306.9m and pre-tax profits were up 186% from £18.1m to £50.6m. Half year earnings per share soared from 3.9p to 10.7p.

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Chief executive, Geoff Drabble, said: "We are delighted to report record first half pre-tax profits of £84m in end markets which remain well below previous peaks.

"Market share gains, the on-going structural shift to rental in the US and operational efficiency meant we delivered a very strong performance across a broad range of metrics despite end construction markets being at a cyclical low point. This is encouraging for both the short-term, where we expect a continuation of current trends, and the longer term where, when cyclical recovery comes, we expect to benefit significantly.

"With our robust debt structure, substantial capacity to fund fleet growth and the well-established momentum in the business we now anticipate a full year profit substantially ahead of our earlier expectations."

Sunbelt, the firm's main US business, saw a 25% leap in rental revenue to $694m, while in the UK the firm's A-Plant rental rose 11% to £86m from £77m on a like-for-like basis.

The group is set to pay an interim dividend of 1p per share, up from 0.93p a year ago.

Cash at the end of period fell from £68.1m to £22.9m.

NR