Big profit increases at Coates Hire
By Murray Pollok22 February 2011
Big profit increases at Coates HireAustralia's largest rental company Coates Hire saw its profits for the six months to 31 December increase sixfold to A$24.7 million, with the business seeing a recovery in activity and margins.
Coates' revenues in the six month period - the first half of its fiscal year - were up 4% to A$497.3 million.
Coates is jointly owned by National Hire Group and private equity firm Carlyle. National Hire's managing director, Andrew Aitken, said: "Coates Group has experienced some recovery in activity and margin in the last 6 months and is expecting this improvement to continue over the balance of the financial year."
National Hire also owns the Allight business. Allight sells pumps and lighting towers and recently acquired Sykes Pumps, which rents and sells pumps in Australia and worldwide. Allight's sales rose by a third to A$54.9 million, including a contribution of A$5.2 million for five weeks of trading from Sykes.
Mr Aitken said; "The Allight capital sales business is well placed to grow revenues both domestically and internationally following the Sykes Group acquisition. Demand from the global mining and infrastructure sectors is expected to underpin this improvement."
National Hire Group said a positive outlook at both businesses meant that it was revising upwards its profit expectations for the full fiscal year to A$20-25 million, from the A$12-16 million given in early December.
The company reported net profits of A$10.3 million for the period, up from A$2.8 million in the same six months of 2009, and the improvement was mainly due to the improved profitability at Coates Hire.