17.06.2025

Flat year for Ashtead

Ashtead, owner of Sunbelt rentals in the USA, Canada and the UK has published its full year results for the 12 months to the end of April.

Group revenues slipped one percent to $10.79 billion, mostly due to lower sales of used equipment from the rental fleet. Rental revenues were four percent higher at $9.98 billion. At the same time Pre-tax profits declined five percent to $1.99 billion, due to the revenue mix .
The company has stopped reporting Sunbelt USA and Sunbelt Canada separately running now with North American General Tool and North American Speciality

The results are broken down as follows
Full year by country/region
North American Revenues: totalled $9.88 billion -1% with an Operating profit of $3.23 billion -4% Entirely due to lower used equipment sales in the General Tool business, partially offset by increases in Speciality.

UK Revenues: came in at $907 million +2.2% with an Operating profit of £68.7 million -4%

Capital expenditure & fleet age Capital expenditure for the year was $2.46 billion down 44 percent on last. While sales of used equipment were $528 million compared to $907 million last year. As a result, the average age of the fleet at the end of the period was 49 months, compared to 45 months a year ago and nearing 2023 levels.
The capex was split as follows:
USA - $2.22 billion -45%
UK $185 million – 30%

Acquisitions: The company has also spent $137 million on five ‘bolt on‘ acquisitions in the year compared to $905 million and 26 acquisitions the prior year - while it continues with its share buyback programme.
May - RentalMax in Illinois.
June - Wave Equipment in Ontario, Canada.
December - JLLive, JLLighting and DigiSet in the UK.
March - Hawkeye Equipment Rentals in California.
April - R N L Rental Network in British Columbia, Canada.

Net Debt at the end of January was three percent lower at $10.33 billion, due to lower capex and acquisitions.

Fourth quarter
Total revenues in the last three months declined four percent to $2.53 billion, while pre-tax profits dropped six percent to $392 million.

Fourth quarter by country
North American Revenues totalled $2.3 billion -4% Operating profit was $704 million -7%
UK Revenues: came in at $221 million -3% with an Operating profit of £13.8 million -32%

Forecast for current year
Rental Revenues- 0% to 4%
Capex $1.8 to $2.2 billion

Chief executive, Brendan Horgan said: "The group delivered record full year rental revenue and adjusted EBITDA, with growth of 4% and 3% respectively. I'd like to thank the team for these results, while leading with our safety-first culture and Engage for Life programme, which are continuing to drive improvements in our safety metrics.”
We continue to take advantage of strong secular tailwinds and structural progression, within our $87 billion and growing industry. While completion continues to outpace starts in local non-residential construction, mega project activity continues to be robust, particularly in the data centre, semi-conductor and LNG space, with the pipeline projected to grow from $840 billion in 2023-2025 to more than $1.3 trillion in the 2026 - 2028 timeframe.”

We added over 42,000 new customers in the year, our cross selling effectiveness has expanded with almost 50 percent of our revenue coming from customers renting both General Tool and three or more Specialty lines of business. We are achieving margin progression by driving improved efficiencies and even better customer experience.”
We are on track to move the group's primary listing to the USA in the first quarter of calendar year 2026, and I would like to thank shareholders for their engagement and approval at last week's EGM. The strength of our foundation and growth strategy is reflected in our results and guidance today. I am excited for FY26 and what lies ahead as we continue to advance our great company.”

Vertikal Comment

This is not one of Ashtead’s better years, although rental remains buoyant due, it says to improved utilisation rates and higher prices, the early acquisitions might also have helped, of course, although most of those added to the North American General Tool division, which saw revenues rise by just one percent over the year.

While the reduction in capital expenditure is steep, some of this is down to timing, given that it did pull some purchases forward into last year. However, the aging fleet is highlighting the issue. With next years forecast set to exasperate the situation, rather than help it.
It is hard to say how things might go in 2025/2026, the company could benefit from reducing its debt a little further but given the economic uncertainties both markets in which it operates might throw up a few good opportunities.

Its very much a ‘watch this space’ moment.