16.11.2011

Speedy moves towards profit

UK rental company Speedy Hire has issued its first half results which show a dramatic reduction in net debt and a return to profitability.

Revenues for the period were actually down nine percent to £161.8 million, but this is due to the disposal of its cabin business, like for like revenues improved by more than two percent. The company also posted a pre-tax profit of £2.8 million, but this is before exceptional one off costs. After exceptionals the company made a loss of £2.3 million, compared with a loss of £13.8 million last year.

Capital expenditure for the period was £30.5 million compared to £19.7 million last year. Of this £25.8 million was spent in the UK and Ireland compared to £17.1 million last year, indicating a higher investment in its fledgling overseas division.

Net Debt was slashed from £113.9 million in March to £77 million at the end of September, a reduction of 32 percent. Click here to see Speedy improves Yield

Chairman Ishbel Macpherson, said: “We are pleased to report the continuation of our recovery in these challenging times. Our strategy of aligning ourselves with stronger customers and market segments, focusing on our core activities and driving improved efficiency is on-going. As a result, the Board is confident of the Group meeting its expectations for the financial year. ”

Vertikal Comment

The first half of Speedy’s financial year was more about restructuring the business in preparation for growth and it certainly appears to be making strong progress towards this aim. As we reported when Speedy issued its preliminary trading statement last month the company has made considerable progress in improving rental rates which is a key part of the company’s and the industry’s emergence from the slow-down.

Speedy has also significantly stepped up its activities within the powered access market, a sector in which it had been under represented in the past, by spending heavily on expanding what was a small fleet. All part of a shift in its product range. It will be interesting to see how the second half develops, in this meantime this is another positive set of results.