Sunbelt Rentals Revenue Jumps 23.2 Percent in Fiscal First Half

Sunbelt Rentals posted revenue of $1,685.1 million in its fiscal first half ended October 31, compared to $1.367.9 million for the same period a year ago, a 23.2-percent increase. EBITDA jumped from $66.5 million a year ago to $819.3 million, a 22.9-percent leap.

Reporting in U.K. pounds, Sunbelt and its U.K. sister company A-Plant combined for £1,267.5 million, about U.S. $ 1.924 million, up from £987.3 million a year ago, a 28.3-percent climb, with strong growth in both businesses.

The group’s strategy remains the same, with growth propelled by strong same-store growth supplemented by greenfield openings and bolt-on acquisitions.

Sunbelt Rentals’ rental-only revenue was $1,187 million, a 22-percent year-over-year jump. Same-store revenue, including stores open by May 1, 2014, climbed 13 percent, with an additional 9 percent coming from bolt-on acquisitions and start-ups.

“I am pleased to be able to report another strong quarter resulting in underlying pre-tax profits of £343 million for the six months, up 21 percent at constant exchange rates on the prior year,” said parent company Ashtead’s chief executive Geoff Drabble. “Even with significant levels of investment, we continue to grow responsibly, generating strong returns and maintaining leverage within our stated objectives. Group ROI was a healthy 19 percent and our leverage reduced to 1.9 times EBITDA.

“We continue to execute on our strategy to diversify the markets we serve, both in terms of geography and sector. Sunbelt’s 22-percent rental-only revenue growth demonstrates clearly the benefits of this strategy and the overall health of our broader markets. We invested £696 million in capital expenditure and opened 38 new locations in the U.S. Given the profitable growth opportunities evident in our markets, we are increasing our full-year guidance for capital expenditure to £1.1 billion. With both divisions performing well, strong end markets and our strategy clearly working, we now anticipate a full year result ahead of our previous expectations and the board looks forward to the medium term with confidence.”

During the period, the company made six acquisitions for a total of £25.1 million including:

• May 29, Sunbelt acquired the business and assets of C. Rowland Enterprises, trading as Air Systems Sales & Rentals for $2 million in cash. Air Systems is a climate-control business in Oregon.
• August 28, Sunbelt acquired the business and assets of Dover Rent-All for $2 million. Dover is a general equipment rental business in Delaware.
• On Oct. 1, Sunbelt acquired the business and assets of Pinnacle Rentals and Pinnacle Tool & Supply for an aggregate consideration of $24 million. Pinnacle is an industrial equipment business in Texas.
• On Oct. 9, Sunbelt acquired The Rental Store, a Canadian equipment rental business in Alberta, for CDN $1.1 million.
• Also A-Plant bought Fraluk Ltd., a climate control business for £1.1 million, and G.B. Access, an aerial rental specialist for £6 million.

    Sunbelt Rentals, based in Fort Mill, S.C., is No.2 on the RER 100. A-Plant and parent company Ashtead plc are headquartered in the U.K.