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(Sharecast News) - Ashtead said it would have positive free cash flow under all downside scenarios during the Covid-19 crisis despite the virus having an impact on its business.
The industrial equipment rental company said it had modelled various outcomes for the coming year with business much lower than so far in 2020.
"Under all these scenarios the group remains free cash flow positive throughout the next financial year" and well above a minimum available liquidity of $460m under a covenant threshold.
Ashtead said it expected underlying pretax profit for the year ending 30 April to be about £1.05bn, up from £947m a year earlier.
The industrial equipment rental company said it had modelled various outcomes for the coming year with business much lower than so far in 2020.
"Under all these scenarios the group remains free cash flow positive throughout the next financial year" and well above a minimum available liquidity of $460m under a covenant threshold.
Ashtead said it expected underlying pretax profit for the year ending 30 April to be about £1.05bn, down from £1.1bn a year earlier.
US rental-only revenue at Ashtead's US business fell 15% in April from a year earlier after a 2% increase in March. Since 10 April the level of US fleet on rent has stabilised and improved slightly and a similar trend happened in the UK and Canada.
The FTSE 100 company said it had not made any staff redundant during the crisis and did not intend to take support from the UK government's job retention scheme.
Ashtead did not refer to its dividend amid a series of large companies canceling their payouts during the crisis. The company cancelled share buybacks in early March and reduced capital spending and acquisition activity.
Chief Executive Brendan Horgan said: "I am certain the swift actions we took during these unprecedented times and the strength of our balance sheet will serve the group well. These factors, when combined with the diversity of our products and end markets, contribute to the strength of our long-term business model and put the board in a position of confidence to look to the coming financial year as one of strong cash generation and strengthening our market position."
Ashtead said it had accessed an extra $500m through its senior secured credit facility for a year, increasing the facility to £4.6bn. Availability is about $2.1bn.
5 Aug 2022 09:27
IN BRIEF: Ashtead Group prices USD750 million in senior notes
Ashtead Group PLC - London-based industrial equipment rental company - Announces pricing of offering of USD750.0 million in 5.500% senior notes due 2032, with the issue price 90.009% of principle amount. The issue is via indirect wholly-owned subsidiary Ashtead Capital Inc, and will close on Thursday. Will use net proceeds to repay portion of borrowing from credit facility.
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