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(Alliance News) - Redde Northgate PLC on Tuesday said it expects to beat consensus expectations for annual profit, due to a stronger-than-expected performance driven by rental demand and robust used vehicle market values.
Shares in the Darlington, England-based commercial vehicle hire firm were 5.6% higher at 399.83 pence on Tuesday in London, the best performer in the FTSE 250.
For the year ending April 30, underlying pretax profit is expected to be around GBP150 million, ahead of company-compiled consensus from seven analysts at GBP133.9 million. It also would be more than double the GBP67.2 million recorded in financial 2021.
Redde Northgate said it has been trading ahead of expectations, with the rental margin to the end of February being 15.8% in the UK & Ireland and 17.5% in Spain.
Also, since December 1, the group has de-fleeted a lower number of vehicles due to rental demand and new vehicle supply constraints, while used vehicle market values have remained strong.
Redde's volumes are now running at around 90% of pre-virus levels, after recovery was hindered in December and January by the Omicron variant and work-from-home restrictions.
Looking ahead, due to having substantial headroom under its facilities, Redde Northgate will launch a share buyback programme for up to GBP30 million, starting with immediate effect and is set to be completed by September 15.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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