UK based rental group Speedy has published its results for the year to the end of March which include a goodwill write off for Geason Training
Total revenues improved three percent to £406.7 million, with utilisation softening slightly from 57 percent last year to 56.6 percent but based on a fleet almost five percent larger, although the average age increased from 39.6 to 41 months. Net debt was cut by 11 percent to £79.3 million and this has continued to decline in the quarter since to stand at just £67.3 million. Capital expenditure was held at similar levels to the previous year at £53.6million. Capital expenditure in April and May was a mere £500,000 and is expected to remain low throughout much if these year.
Pre-tax profit for the period fell 28 percent to £20.7 million, but this includes a £12.2 million non-cash write off of the goodwill associated with Geason Training - acquired in December for £9.3 million - due to a lack of performance and the fact that it is subject to a claim from a funding agency alleging poor financial controls and over payments of up to £2.6 million over a three year period from August 2017.
Chief executive Russell Down said: “I am pleased to report continued positive momentum across the group. We have a well invested fleet, diversified customer base and robust balance sheet. Our priority remains the welfare of our colleagues, customers and the communities we serve. We continue to monitor Government guidance and take action to ensure the safety of our colleagues as we continue to operate to satisfy customer demand. Whilst Covid-19 will have some financial impact on the business, I am reassured by our performance in the last three months. We are well placed to emerge in a position of strength to pursue our strategic objectives as more normal trading levels return.”
The underlying results here are actually very good, and according to a statement with these numbers, business continues to pick up with June revenues only 17 percent down on last year. This, with a good number of its staff still furloughed, and prior to a good many sites opened up yet.
The Geason write down was a sensible move, given what appears to have been happening with the business since it was acquired, on the surface it looks like the company was ‘sold a pup’. That aside there is a good chance that Speedy will emerge from the pandemic in better shape than most, with much of this down to the fact that it had regained some of its ‘mojo’ well prior to the Lockdown starting.
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