UK rental group Speedy has issued a trading statement and is closing its international operations.
The trading update statement is as follows: “Trading since 30 September 2020 has been ahead of the board's expectations. Revenue has improved as activity levels have continued to increase. In February 2021, core hire revenue in the UK and Ireland was around two percent higher than the prior year, utilisation for the period 1st October 2020 to date is 58.7 percent compared to 56.2 percent last year.”
“Underlying overhead costs across the group remain tightly controlled. The group has not utilised government furlough or loan schemes in the second half of the financial year. As a consequence of stronger than expected revenue recovery, profit before tax for the year ending 31st March 2021 is anticipated to be well ahead of current market expectations.”
The company has also announced that it has sold the equipment and assets of its operation in Abu Dhabi, to its primary customer ADNOC Logistics and Services for $18 million in cash. The business was opened in 2012 on the back of a five year contract
which was subsequently renewed, however the final contracts with ADNOC expired yesterday.
Speedy is also owed $12 million by ADNOC which is payable within 30 days. The two companies have also signed a Transitional Services Agreement with a maximum duration of four months, to support the transfer of the assets, and help with the transfer of the 600 employees to ADNOC. Once complete Speedy will formally wind up its business in the Middle East. The company still has a joint venture business in Kazakhstan which remains. This announcement marks the end of the Middle East closure process that began in 2015 - see: Speedy to exit the Middle East
Chief executive Russell Down said: "I am pleased to report another period of momentum and resilience for the group as our colleagues have adapted and supported our customers in these challenging times. Our ongoing positive trading has benefitted from increasing activity levels and shows the strength of our strategy, people and operational delivery.”
"The successful exit from the Middle East operations is an important strategic step for Speedy and we wish the whole of the ADNOC team every success in the future. Looking ahead, we are well positioned to take advantage of the market opportunities in the UK and Ireland as activity levels continue to improve."