Ashtead hikes full year targets as record growth rolls on in third quarter

After a strong third quarter of growth in both the UK and US produced a record profit, Ashtead said it expected full year results to be ahead of its previous expectations.

The FTSE 100 equipment rental company grew rental revenue 25% to £462.9m in the three months to the end of January, with profit before tax up 33% to £113.9m.

This meant the company's underlying pre-tax profits of £379m for the first nine months was up 33% on the prior year.

Both Sunbelt in the US and A-plant in the UK maintained their rates of growth from the first half of 25% and 18% respectively as the company continued to capitalise on the circa-7% growth in its markets last year and 8% forecast for this year.

Management is making hay while the sun shines on the equipment rental market, with organic growth and greenfield openings supplemented by bolt-on acquisitions.

But even despite £783m invested in capital expenditure and £162m on bolt-on acquisitions in the nine months of the financial year so far, and capex now guided to at least £975m for the full year, management raised their forecast for the full year.

"Even with these significant levels of investment, we continue to grow responsibly, generating strong returns and maintaining leverage within our stated objectives," said chief executive Geoff Drabble.

"We now anticipate a full year result ahead of our previous expectations and the board looks forward to the medium term with continued confidence."