4th Mar 2025 09:11
(Alliance News) - Ashtead Group PLC on Tuesday said the strength of hurricane response efforts helped more than offset lower activity in construction markets for the equipment hire firm, leaving US sales broadly flat in the recent quarter.
Pretax profit fell 7.5% to USD409 million in the three months to January 31 from USD442 million a year prior. Adjusted earnings before interest, tax, depreciation and amortisation edged higher to USD1.18 billion from USD1.17 billion.
Revenue fell 3.4% to USD2.57 billion from USD2.66 billion, rental sales rose 0.8% to USD2.38 billion from USD2.36 billion
For the first nine months of the financial year, pretax profit fell 4.7% to USD1.61 billion from USD1.69 billion a year prior, while adjusted Ebitda rose 3.2% to USD3.87 billion from USD3.75 billion.
Revenue nudged higher to USD8.26 billion from USD8.23 billion, with rental sales up 4.5% to USD7.65 billion from USD7.32 billion.
In response, shares in the London-based industrial equipment rental company were 3.1% lower at 4,650.00 pence in London on Tuesday morning. The wider FTSE 100 index was down 0.5%.
Ashtead said revenue in the US was flat at USD7.05 billion compared with USD7.07 billion a year ago, with pretax profit of USD2.00 billion, down 3.8% from USD2.08 billion.
Organic growth in the US was 3%, while bolt-on acquisitions since May 1 2023 contributed 1% of rental-only revenue growth.
Chief Executive Brendan Horgan said: "In North America, the strength of mega projects and hurricane response efforts have more than offset the lower activity levels in local commercial construction markets."
Horgan explained local construction markets have been affected by higher interest rates but he said underlying demand "continues to be strong and we expect this segment to recover as interest rates stabilise".
Ashtead estimates that hurricane response efforts contributed USD90 to USD100 million to rental revenue in the period, as its equipment was used in the clean-up.
Looking ahead, Ashtead said: "We are in a position of strength, with the operational flexibility and financial capacity to take advantage of the ongoing structural growth opportunities we see for the business and enhance returns to shareholders as we follow our Sunbelt 4.0 plan. We expect full year results in line with our previous expectations and the board looks to the future with confidence."
Ashtead expects rental growth in 2025 of 3% to 5%, but lowered its expectation for growth in Canada to between 9% to 13% from 15% to 19%. In 2024, rental income in Canada grew 16%.
In December, Ashtead cut guidance for rental revenue growth to 3% to 5% for the full-year from 5% to 8%.
By Jeremy Cutler, Alliance News reporter
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