28.11.2007

Speedy up 36%

Speedy Hire the UK’s largest rental company has reported its first half financial results to the end of September. Revenues climbed to £209.5 million, an increase of almost 36 percent.

The increase includes two months revenues from Hewden Tool Hire, which contributed around £13.4 million and £600,000 from Waterford Hire. Speedy has decided not to disclose like for like (same store) revenues until Hewden is full absorbed a year from now.

Operating income jumped by 36 percent to £29.3 million while Pre Tax profits increased by a more modest 17 percent to £18.2 million due to write offs of exceptional costs associated with its acquisitions and high interest charges.

Capital expenditure was dropped marginally to £46 million compared to almost £48 million in the same period last year. The company stressed its determination to maintain a young reliable fleet and pointed to the fact that it has grown substantially with the acquired equipment.

Speedy says that its customer base has expanded by 40 percent to around 100,000 accounts, and that it has established a stronger position with Industrial, Utility and Government customers.

It claims that the broader customer base will enable it to increase the level of cross-selling between the Speedy divisions and that it has “earmarked an additional £10 million for investment in new equipment to meet the wider demands of this enlarged customer base.”

Speedy says that all retained depots, (21 overlapping depots have closed so far) equipment and vehicles will be re-branded as Speedy Hire by January 2008. With a common IT system and single trading catalogue in place shortly thereafter.

It also confirms that it has found the business and assets exactly as expected is even more confident of delivering the £20 million of synergy benefits that it
forecast at the time of acquisition.

“In summary, we could not be more pleased with progress thus far” said David Wallis the Speedy chairman.

Looking at the equipment business which includes Speedy Lifting, revenues were up by almost 33 percent to £101.4 million, while operating income grew by 27 percent to 17.9 percent.

Steve Corcoran, chief executive, estimates the UK rental market at around £4.4billion of which £3.5 billion is accessible to Speedy with its current product range. He goes on to say that Speedy expects the UK market to grow by 12 percent over the next two years.