Sunbelt and A-Plant on the rise in latest quarter

04 September 2013

Ashtead Group, which includes USA-based Sunbelt and A-Plant in the UK, continued its climb with record first quarter pre-tax profits of £99 million, up 59% on the same period last year.

Group revenue increased 26% to £411 million in the quarter, which ended 31 July. Sunbelt was the main driver of group performance. Its revenue grew 25% to US$479 million, thanks to a 17% increase in average fleet on rent and 6% improvement in yield.

Sunbelt's total revenue, including new and used equipment, merchandise and consumable sales, grew slightly less by 22% to $526 million as result of reduced used equipment sales.

A-Plant had a good quarter, delivering rental revenue growth of 35% to £61 million. Rental revenue growth excluding acquisitions was 12%, reflecting 9% more fleet on rent and a 3% improvement in yield.

Ashtead's chief executive, Geoff Drabble, said,Our focus remains on organic growth with £279 million of capital expenditure in the first quarter. Whilst we continue to invest significantly in the business, our strong margins allow us to do this while delevering.

“As a result of this impressive performance, and with a strong balance sheet to support future growth, we now anticipate a full year result ahead of our previous expectations."

As a result of this investment, the group's rental fleet value at the end of the first quarter was £2.5 billion, with an average age of 29 months. Individually, Sunbelt's fleet size was $3.1 billion, up from $2.7 billion. This supported strong fleet on rent growth of 17% year-on-year. Average first quarter utilisation was 73%, up from 70% in the first quarter of 2012.

Sunbelt's strong revenue growth resulted in a record first quarter earnings before interest, taxes, depreciation, and amortisation (EBITDA) margin of 46%, contributing to an operating profit of US$161 million, up from $114 million.

A-Plant's EBITDA margin improved to 31%, from 29%, and operating profit increased to £8 million from £3 million in the first quarter last year.

For the full year, expected gross capital expenditure is unchanged from £560 million and net capital expenditure, after disposal proceeds, of £470 million.

As expected, debt increased during the quarter to £1.187 billion, from £988 million, due to fleet investment, a number of small bolt-on acquisitions and the usual seasonal increase in working capital, said the company.

Latest News
TransWorld moves to open source technology
The company will be repurposing its facility for another use and will focus on offering design, engineering and consulting services to its clients.
First Enerpac SBL600 in the United States
Engineered Rigging accepted the first delivery of the Enerpac Super Boom Lift SBL600 hydraulic gantry. 
How to navigate the current insurance environment
Lauren Fronczak discusses the intricacies of the industry’s evolving market.