Ashtead Group, the U.K.-based equipment rental company, has announced a higher pretax profit for the second quarter of fiscal 2024. This growth is attributed to increased rental revenue, particularly in the U.S., despite the inflationary environment.
For the second quarter ended October 31, pretax profit reached $666 million, compared to $658 million in the same period last year. Adjusted pretax profit, which excludes exceptional and one-off items, was $688 million. However, this figure was lower than last year’s $697 million due to higher financing costs resulting from the elevated interest rate environment.
Ashtead Group anticipates a depreciation charge of $2.12 billion and a net interest cost of $540 million for the full year. Consequently, this may cause the company to miss its full-year forecasts, as previously guided.
During the second quarter, the group’s revenue increased by 13% to $2.88 billion from $2.54 billion. Rental revenue for the same period also experienced substantial growth, rising from $2.31 billion to $2.58 billion.
Looking ahead, Ashtead Group expects revenue to continue growing between 11% and 13% for the year, in line with their previous guidance provided in November. It’s worth noting that the company expects Ebitda to be slightly below current market expectations for the coming year, but no specific update on this metric has been provided.
The board of Ashtead Group has declared an interim dividend of 15.75 cents per share, marking an increase from the previous 15 cents per share.
Despite the current market conditions and ongoing structural changes, Chief Executive Brendan Horgan expressed confidence in the company’s position of strength. Ashtead Group possesses operational flexibility and financial capacity, allowing them to capitalize on emerging opportunities.