Ashtead plc, parent company of Sunbelt Rentals, posted record fiscal first-half profit of £84 million, compared with £30 million for the same period a year ago. Rental revenue increased 25 percent to $694 million compared with $557 million a year ago. Sunbelt’s total revenue rose from $615 million to $775.8 million.
Sunbelt Rentals’ EBITDA margin rose to 38 percent, compared with 34.5 percent a year ago, and the company now expects full-year profit to top earlier expectations significantly.
Sunbelt posted a 12-percent jump in fleet on rent, 7-percent higher yield and a first-time contribution from Empire Scaffold. In the U.K., A-Plant’s first-half revenue grew 11 percent to £86 million (about U.S. $134.6 million) compared with £77 million a year ago, an 11.7-percent jump, with 2-percent growth in average fleet on rent and 6-percent yield improvement.
“Market share gains, the ongoing structural shift to rental in the U.S. 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,” said Ashtead chief executive Geoff Drabble. “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.”
The company said that capital expenditure this year will be concentrated in the first half as usual as it maximizes expenditures for the seasonally stronger summer months. First-half expenditures were £253 million gross (about U.S. $396 million) and £212 million net of disposal proceeds, significantly higher than £96 million gross and £72 million net a year ago. As a result, the average age of the group’s rental fleet Oct. 31 was 39 months compared with 44 months a year ago. For the year as a whole, Ashtead expects to invest about £400 million gross (about U.S. $626 million).
Sunbelt Rentals, based in Fort Mill, S.C., is No. 3 on the RER 100. Ashtead is based in London.