Trading Update

RNS Number : 6344E

Speedy Hire PLC

11 April 2011

 



11 April 2011

Speedy Hire Plc

('Speedy', 'the Company' or 'the Group')

TRADING UPDATE

Speedy Hire Plc, the UK's largest provider of tools and equipment for hire, is releasing this trading update in respect of the period ended 31 March 2011.

Trading

Group revenues (excluding fleet equipment sales) in the three months to 31 March 2011 improved by 4.8% on the prior year period.

In the UK Asset Services business, fourth quarter revenue (excluding fleet equipment sales) increased by 3.9%, despite lower revenues within both the Engineering Services and Space operations. Excluding the impact of the expiry of a Network Rail maintenance contract within Engineering Services, fourth quarter revenue (excluding fleet equipment sales) for UK Asset Services was up 6.5%.

The volume of equipment on hire in the UK fell 1.0% in the March quarter compared to the quarter ending 31 December 2010. Equivalent quarter on quarter yields increased 2.8%, principally reflecting a 1.8% rise in average hire rates. Over the course of the year, March 2011 UK volumes are 0.6% down and UK hire rates are 9.9% up on March 2010.

Fourth quarter trading in the start-up International and Training & Advisory Services divisions was also encouraging, with revenues (excluding fleet equipment sales) up approximately 50% and over 120% respectively compared to the prior year period. Combined revenues from these two divisions totalled over £10m for the full year, compared to £3.7m in the year to 31 March 2010.

For the year ending 31 March 2011, Group revenues (including fleet equipment sales) are expected to be slightly above £350m, with second half revenues broadly equivalent to the £177.3m reported in the first half.

Financial Position

Net debt at 31 March 2011 was approximately £115m (31 March 2010: £119.3m). This strong performance reflects a continuing focus on prudent cash management and was achieved despite a circa £10m increase in net capex in FY11 as compared with FY10. As a consequence, net debt/EBITDA (before exceptional items) at 31 March 2011 is anticipated to fall below 2x (30 September 2010: 2.1x).

Outlook

The Board confirms that, since the IMS dated 14 February 2011, there has been no change to its expectations for the year ending 31 March 2011 and, accordingly, the Group continues to expect to report a marginal adjusted loss before tax (before amortisation and exceptional items) for the full year. This reflects a strong performance in the second half, following an adjusted loss before tax (before amortisation and exceptional items) of £9.9m in the first half.

Notwithstanding this encouraging performance, the Board maintains its cautious view about short term recovery prospects and cost pressures in the UK and is mindful of the political tensions in the Middle East. Therefore its expectations for the new financial year are unchanged.

However, with its strong balance sheet, improving trading performance, market leading position and ever closer alignment to growth markets, the Board considers that Speedy is well placed to benefit from the eventual market recovery. 

Speedy will announce its final results for the financial year ending 31 March 2011 on 18 May 2011.

For further information:

Speedy Hire Plc	Hudson Sandler
Steve Corcoran, Chief Executive Justin Read, Group Finance Director Tel: [phone]	Kate Hough / George Parker Tel: [phone]

Note - Forward looking statements

The information in this release is based on management information.

This report includes statements that are forward looking in nature. Forward looking statements involve known and unknown risks, assumptions, uncertainties and other factors which may cause the actual results, performance or achievements of the Group to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Except as required by the Listing Rules and applicable law, the Company undertakes no obligation to update, revise or change any forward looking statements to reflect events or developments occurring after the date of this report.

Notes to Editors:

Founded in 1977, Speedy is the leading UK provider of equipment rental and support services to a wide range of clients across the construction, infrastructure, industrial, manufacturing and facilities management sectors - as well as to local trades and industry.

Operating from over 300 fixed sites - together with a number of on-site facilities at client locations throughout the UK, Ireland and an international hub based in the Middle East - the Group supplies a range of services including:

·      the provision of small tools and equipment

·      surveying and measurement instrumentation

·      lifting and materials handling equipment

·      powered and non-powered access equipment

·      temporary accommodation

·      compressed air

·      temporary power generation

·      mechanical pumps

·      temporary site communications

The Group also provides associated services through the provision of training, asset management and testing, repair, inspection and maintenance (TRIM), as well as offering advisory services in areas such as health and safety, environmental and regulatory compliance.

Website:  www.speedyhire.plc.uk

 

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