Ashtead Group PLC on Tuesday announced higher profit and revenue for what it called a ‘record performance’ in the financial year ended April 30, boosted by rental income in the US and Canada.

The London-based US-focused industrial equipment rental company reported pretax profit of $2.16 billion, up 30% from $1.67 billion a year prior and 1.3% higher than $2.13 billion expected by Liberum.

Adjusted pretax profit rose 26% to $2.27 billion from $1.82 billion and was 1.0% higher than Liberum’s estimate of $2.25 billion.

Ashtead said its performance in financial 2023 was a ‘record’ with ‘ongoing momentum in robust end markets’.

The company noted inflationary pressures, in particular regarding labour cost, transportation and fuel. Net financing costs increased 57% annually to $366.2 million in financial 2023, from $232.6 million. Staff costs were 17% higher at $576.0 million from $490.5 million.

Revenue rose 24% to $9.67 billion from $7.96 billion and was 0.5% higher than Liberum’s expectation of $9.62 billion. Rental revenue increased 22% to $8.67 billion from $7.24 billion.

US rental-only revenue climbed 23% to $5.88 billion from $4.78 billion, while Canada rental-only revenue grew 20% to C$548 million, about $410.3 million, from C$456 million.

UK rental-only revenue climbed 6.5% to £429 million from £403 million.

The company declared a dividend of 85.0 US cents per year, up from 67.5 US cents a year ago. This brings the total dividend to 100.0 US cents, in line with Liberum’s expectations, and up 25% from 80.0 US cents paid for financial 2022.

Looking ahead, the company cited Sunbelt3.0, a project under which it plans to add 298 greenfield locations across North America by 2024, amid a focus in the UK to transform the business towards enhanced and sustainable margins and returns.

Chief Executive Brendan Horgan said: ‘We enter the final year of Sunbelt 3.0 with clear momentum in strong end markets, which are enhanced by the increasing number of mega projects and recent US legislative acts. We are in a position of strength, with the operational flexibility and financial capacity to capitalise on the opportunities arising from these strong markets and ongoing structural change. The board looks to the future with confidence.’

Ashtead shares were 0.2% higher at 5,422.00 pence each on Tuesday morning in London.

Copyright 2023 Alliance News Ltd. All Rights Reserved.