18th Mar 2014 11:01
LONDON (Alliance News) - Shares in equipment-rental hire and support services group Speedy Hire PLC plummeted Tuesday morning, after it said its now expects lower profits for the year ending March 31, hit by bigger trading losses in its Middle East business and asset sales below historical trends.
In a trading statement last week, the group warned that whilst its trading performance internationally was running behind expectations, it was confident that its UK performance would help it meet full year expectations.
However, Speedy Hire said Tuesday that asset sales are running at a slower pace than anticipated and below historical trends, and bigger-than-expected trading losses in its Middle East business will hit its profit for the year harder than its originally anticipated.
"As a consequence, the Speedy board now expects adjusted pretax profit (before amortisation and exceptional costs) for the year ending March 31, to be in the region of GBP14.5 million," the company said in a statement.
Shares in Speedy Hire dropped 16% Tuesday morning, trading at 64.35 pence per share.
Speedy Hire said its international division has also been hit by adverse foreign exchange movements relating to its Kazakhstan joint venture. It said that while total UK revenues are marginally higher than a year earlier due to growth in services revenue, the higher margin hire revenues for February and March are below forecast.
"Focus for the group is on completing the stabilisation of the international division, and in the UK, focusing the sales effort to take advantage of the improving economic conditions, and delivering the previously announced network and asset optimisation projects," it said Tuesday.
The group said it expects to release its full-year results on May 13.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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