8th Sep 2020 08:40
(Alliance News) - Industrial equipment rental company Ashtead Group PLC on Tuesday posted a "resilient" first quarter performance during the Covid-19 crisis.
Revenue for the three months to July 31 declined 6% to GBP1.20 billion from GBP1.28 billion. Rental revenue fell 7.1% to GBP1.08 billion from GBP1.16 billion.
By division, US rental revenue fell 6.9% to GBP939 million, while UK rental revenue was down 9.7% to GBP98.8 million. The Canadian division saw a 4.4% dip in rental revenue to GBP43.3 million.
Pretax profit for the quarter was down 37% to GBP192.4 million from GBP304.7 million. Operating profit fell 30% to GBP249 million.
Chief Executive Brendan Horgan said: "This resilient performance illustrates the successful execution of our long-term strategy, which we embarked upon after the last recession, to broaden and diversify our end markets and strengthen our balance sheet. This positioned us to capitalise on our ever increasing scale, while remaining agile, particularly during these unprecedented times."
Ashtead said the sudden fall in activity levels due to the Covid-19 pandemic and resultant government imposed shutdowns had a significant impact on profit in the quarter as a large proportion of costs are fixed in the short term.
While trading volumes were lower than last year as a result of the pandemic, Ashtead said, this was offset to some extent by emergency response efforts.
Assuming no significant second wave of Covid-19 infections, Ashtead expects rental revenue to be down mid to high single digits on a constant currency basis for the full-year.
Shares in FTSE 100-listed Ashtead were down 0.2% at 2,689.00 pence each in London on Tuesday morning. Year-to-date the stock is up 11%.
By Tapan Panchal; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Ashtead Group