11th Nov 2014 09:58
LONDON (Alliance News) - Speedy Hire PLC on Tuesday said its pretax profit jumped in the half year on the back of a rise in revenue in the period, giving it confidence it will meet full-year expectations as it implements a new strategy to turn around its Middle East arm.
The equipment and plant hire company said its pretax profit in the half year the end of September was GBP5.3 million, up from the GBP3 million posted a year earlier.
Revenue in the period was up to GBP190.8 million from GBP168.7 million last year, driven by an 11% rise in UK & Ireland Asset Service revenue to GBP176.3 million. Revenue also was boosted by a 31% increase in International Asset Services revenue in the period to GBP13 million. The company said its revenue mix in the first half continued its shift to services as the fall in hire revenue seen in the second half of last year continued.
On the back of the stronger results, the company hiked its interim dividend to 0.30 pence per share from 0.26 pence last year.
"This has been a positive first half of the financial year. Whilst these results primarily reflect our self-help measures and the delivery of early efficiency improvements, we have also begun to benefit from an improving market environment in the UK, thanks to a focussed and disciplined approach to our strategic accounts and re-engagement with our regional customers," said Chief Executive Officer Mark Rogerson.
Rogerson said the actions taken in the Middle East have stabilised its business, but said it has not yet delivered the expected improvement in performance. It has now completed its review of the division and is implementing a strategy designed to stem losses and realise value from the business. The Middle East arm has been hit by a legacy cost base and weak demand for general and spot hire services, Speedy Hire said.
"We are on-track to deliver results for the full year in line with the board's expectations and our confidence for the future is underpinned by an increased interim dividend," Rogerson added.
Speedy Hire shares were trading flat at 67.75 pence on Tuesday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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