The £3 billion cap has seen its share price treble since late 2011, predominantly because of US market success. Today the attention shifts to Derbyshire where it has bought Accession, a provider of temporary access solutions and traffic management to the events and industrial sectors. Its main trading subsidiary is Eve Trakway.
Ashtead is paying £28 million cash for the business with an additional £7 million payout depending on Accession's profits in the year to 28 March 2014. Its shares dipped 0.3% to 589.5p on the news. The deal isn't big enough to trigger material earnings upgrades for Ashtead, but it does show that the group isn't entirely reliant on the US for its future growth.
Yet it is almost certain the US will, once again, be the focal point when Ashtead reports full-year results on 20 June. Click here to read our market report on the asset rental business which includes in-depth analysis of Ashtead's position in the US.
There are positive signs towards economic recovery in the US and this is illustrated today in trading updates from two other support services companies.
Fiberweb (FWEB) flags strong US construction markets. Industrial-to-medical components distributor Diploma (DPLM), which derives half of its revenues from North America flagged in its half-year results that sales had benefited from improving residential construction markets. However, there is a negative in that revenues were also impacted by a reduction in sales of new construction equipment to large rental companies and dealers, following a rebuilding of rental fleets over the last 18 months.
Diploma's shares retreated 2.5% to 584.5p after investors didn't like a reduction in operating margins, even though the company had already flagged this would happen because of investment in resources. Espirito Santo says 'opportunities for progress remain undiminished, backed by strong finances.' It adds: 'We would, hence, see any short-term share price weakness as an opportunity to add to a strong long-term story.'