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Speedy Hire profit jumps nearly 60%, hikes dividend
Tools rental firm Speedy Hire posted a near-60% jump in full-year profit on Wednesday as it hiked its dividend and said it has kicked off the current year on a positive note.
In the year to the end of March 2018, adjusted pre-tax profit rose to £25.9m from £16.2m the year before as revenue increased 2.2% to £377.4m and revenue excluding disposals pushed up 6.4% to £371.6m thanks to growth in services revenues and growing demand from the group's local and regional customer base.
Adjusted earnings per share rose 65% to 4.04p and the dividend per share was lifted by 65% to 1.65p. In addition, the company brought down its net debt to £69.4m from £71.4m in 2017 after £21.3m of acquisition spend.
Speedy Hire said return on capital employed increased by 4.9% to 11.5%, above its cost of capital for the first time "in many years" as it managed its cost based and continued to optimise its hire fleet. The company is aiming to up its ROCE further through targeted capital expenditure and disposals, value enhancing acquisitions, growing services revenues and tight management of overhead costs.
Chief executive Russell Down said: "We are delighted with these results which reflect a strong operational performance, robust capital management, the benefits of the strategy which was launched in September 2015, the impact of our recovery initiatives and some earlier than expected acquisition synergies.
"The market remains competitive; however the current year has got off to an encouraging start with revenue ahead of the comparative period on a like for like basis. Whilst we are early into the new financial year, and some of the benefits from the acquisitions have been realised, we are confident of delivering further progress in the year ahead in line with our current expectations."
At 1005 BST, the shares were up 0.6% to 59.35p.