11.04.2011

Rates up 10% at Speedy

UK based rental company Speedy Hire has reported a solid fourth fiscal quarter to the end of March, with revenues up 4.8 percent overall at £350 million.

UK business improved 3.9 percent even after the ending of a major rail maintenance contract. Non rail rental revenues climbed 6.5 percent. Overseas and advisory revenues for the year were £10 million, compared to £3.7 million in 2010.

Rental rates continued to improve in the fourth quarter climbing 1.8 percent, with rates in March 9.9 percent above those of March 2010.
Speedy says that it still expects to post a loss for the year, with the second half compensating somewhat for the loss in the first half. The company has cut its net debt from £119.3 to £115 million in spite of spending £10 million on new equipment for its rental fleet.

The company says that in spite of the encouraging performance in the fourth quarter it remains cautious about short term recovery prospects and cost pressures in the UK and is leaving its forecasts for 2011/12 unchanged.

Vertikal Comment

It is good to see yet another indication that rental rate improvements are not only holding, but continuing to improve. For the industry to provide the minimum service and safety levels that are essential, the rates need to reflect the true costs.

What is even more encouraging is how quickly rental companies are adjusting to the improvement in demand and smaller equipment population, to start edging rates up. Perhaps it reflects a maturity in the market as well as the fact that the rental market is perhaps a little less fragmented than in the past.