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(Alliance News) - Ashtead Group PLC on Tuesday reported strong revenue and profit growth in its second quarter, as it raised its interim dividend and upped its rental revenue outlook.
In the three months ended October 31, the London-based industrial equipment rental company said revenue grew by 28% to USD2.54 billion from USD2.03 billion a year before. Pretax profit jumped 40% to USD658 million from USD474 million.
In the first half as a whole, revenue rose 26% to USD4.80 billion and pretax profit grew by 35% to USD1.19 billion.
The company increased its interim dividend by 20% to 15.0 US cents from 12.5 US cents a year prior.
Ashtead now expects annual results ahead of its previous guidance. "Our business is performing well with clear momentum in robust end markets. We are in a position of strength and, with increased market clarity, have the operational flexibility to capitalise on the opportunities arising from the market and economic environment we face," Ashtead said.
Further, it increased its rental revenue guidance for all regions.
For financial year 2023 ending April 30, it now expects growth of 20% to 23% in the US, up from 17% to 20%. In Canada, it upped its guidance to between 22% and 25% from 19% to 22%. In the UK, it now expects rental revenue to stay flat, from a previous guidance that anticipated a fall of up to 4%, with a flat revenue back then being the top of the range.
For the whole group, it now expects rental revenue growth of 18% to 21%, up from 15% to 17%. Anticipated free cash flow remained unchanged at around USD300 million, with capital expenditure of between USD3.3 billion to USD3.6 billion also remaining flat compared to the previous guidance.
In the financial year to April 30, 2022, Ashtead reported a free cash flow of USD1.13 billion, down 38% from USD1.82 billion a year prior. Capital expenditure was at USD3.61 billion on April 30.
Ashtead shares were up 1.4% at 5,104.00 pence on Tuesday morning in London.
By Tom Budszus, Alliance News reporter
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