AGM Statement

Ashtead Group PLC 9 October 2000 ASHTEAD GROUP PLC PRESS RELEASE Annual General Meeting First 5 months revenue up 78% * BET USA acquisition integration completed in 70 days (* The equipment rental business in the US purchased from Rentokil Initial plc on 1 June 2000 for £320m.) At today's Annual General Meeting of Ashtead Group PLC, the leading UK and US equipment outsourcer, Peter Lewis, Chairman, said: 'In June we made the largest acquisition in our history. In the circumstances I decided shareholders would welcome a longer than usual trading statement about events since. I am pleased to be able to report strong Group progress for the year so far. In the first 5 months to end September, we have increased: - total revenue over the previous year by 78% - US revenue - 'Sunbelt' - (excluding the BET acquisition) by 56% - UK revenue - 'A-Plant' - by 4%. Full details are shown at the end of this release. The UK market remains highly competitive, clear evidence of which is reflected in the recent statements of several of A-Plant's competitors. Whilst A-Plant is not immune from these conditions, market leadership has given us the capacity to meet customers' expectations on a growing scale. This emphasis on delivering customer satisfaction through the widest product range, nation-wide availability and growing e-commerce support, will enable A- Plant to continue to grow largely organically. It has also justified A- Plant's implementation last week of a national price increase which will help offset some of the costs of the investment we have made in delivering this enhanced service. A-Plant has opened nine new Profit Centres since 1 May and now has a national network of 270. Ashtead Technology which presently operates almost entirely in the offshore exploration, production and maintenance markets, has achieved a like for like revenue increase of 17%. The prospects for substantial revenue growth next year have been further enhanced by the continuing high price of oil. Today, we are pleased to announce the purchase of the business and assets of Response Rentals which specialises in the rental of environmental test and measurement equipment in North America. Response will enlarge Ashtead Technology's existing US business in product, customer base and sphere of activities with a predominantly on-shore profile compared with our current off-shore bias. The price of $5.8m is a multiple of 3.2x Response's earnings before interest, tax, depreciation and amortisation in the year to 31 December 1999. Further details are contained in a separate press release issued today and posted on our website. And it is America, which has been at the centre of your Group's strategic planning for over 2 years, that is now beginning to deliver the rewards that your board expected when it decided to make a quality platform acquisition to add to Sunbelt. The strength of the management team we have assembled in the decade since we began our business in America is demonstrated by the speed with which the merger of BET USA into Sunbelt has been accomplished. Within 70 days of purchase on 1 June, Ashtead management completed the integration into Sunbelt of the collection of businesses that previously comprised BET USA, virtually all of which had remained largely independent of one another under their two previous owners for more than 15 years. The benefits are already beginning to show and will further manifest themselves in the first full year of our stewardship. Indeed, the future prospects in America for Ashtead have never been better. A management team that has delivered compound annual growth in operating profit over the last four years of 53% whilst opening 62 new Profit Centers has now created a unified pan-American business in a little over 2 months. The enlarged Sunbelt now has 151 Profit Centers across America and is that nation's fourth largest business of its kind yet it has just a c2% market share. The Ashtead Board regularly monitors macro economic conditions in America. The short-term outlook is positive with continuing strong but not excessive GDP growth fuelled by spectacular gains in productivity. If, as is currently generally predicted, the worst prospect for the US economy is a 'soft landing' - which, in practical terms, would mean that economy continuing to grow as fast as the UK does normally - we expect to benefit as we did from the comparatively severe UK recession in the early nineties which itself was the catalyst for Ashtead's sevenfold growth in the seven years to this April. Sunbelt's special advantages in the United States, which include: - our unique business model with its emphasis on local profit motive which is unmatched by its US rivals; - the Group's experience of varying business conditions borne of our origins in the more competitive UK market; - the opportunities presented by the 98% of the US market we do not have; and - our proven skills in growing organically which eliminates the need for constant acquisitions as the primary means of improving profits all combine to indicate that Sunbelt will benefit from the growing demand for the outsourced rental solution in all currently forseeable conditions. It should also be remembered that the wide spread of Sunbelt's more than 100,000 customer base goes far beyond new construction and new housing and extends into almost every aspect of commercial and industrial activity. We regard meeting the expectations of us this year as important and we are currently satisfied with the results to date against our internal forecasts. But, in addition, the prospects for sustained growth beyond this year are being enhanced by the customer appeal of our growing range of specialist products, the speed of the successful US integration, our progress in beginning to turn round the inherited decline in BET USA and the enthusiasm for our business model across our enlarged Profit Center network.' ASHTEAD GROUP PLC REVENUE SUMMARY Revenues for the Revenues for the five months to five Months to 30 September 30 September Increase 2000 1999 2000 1999 % £m £m US$m US$m Sunbelt Rentals Excluding BET 68.6 44.0 100.8 64.7 56% branches BET branches (for 69.6 - 102.3 - - four months - see note 1 below) Total 138.2 44.0 203.1 64.7 214% A-Plant 82.0 78.7 120.5 115.6 4% Ashtead 4.5 3.9 6.6 35.7 17% Technology Group total 224.7 126.6 330.2 186.0 78% Geographic split 2000 1999 of revenues % % US 62 36 UK 38 64 100% 100% Notes 1. Revenues from the former BET branches acquired on 1 June 2000 are included from the date of the acquisition and thus represent revenues for the four months to September only. 2. Revenues from the former BET branches include total rental revenues of 48.1m (US$70.7m). 3. The translation into US dollars of the Group's revenues which are accounted for in sterling has been made for the convenience of US readers using the mid-market exchange rate on 2 October 2000 of $1.4694 = £1. 4. This announcement and a copy of the presentation being made today by Sunbelt Rental's management to analysts and investors in London will be available on our website: www.ashtead-group.com from 1500 hours on 9 October 2000. Further information Peter Lewis ) Ashtead Group PLC 01372 362300 George Burnett ) Ian Robson ) Andrew Grant Tulchan Communications 0207 353 4200
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