Another Ashtead record
13 June 2023
Sunbelt Rentals’ parent Ashtead Group has continued its strong performance, reporting record results for the year ending 30 April 2023.
Group revenue increased 24 per cent at constant currency exchange rates to $9,667 million or £7,740 million) in the year (2022: $7,962 million or £6,375 million). This resulted in adjusted profit before tax increasing by 26 per cent to $2,273 million or £1,820 million (2022: $1,824 million or £1,460 million). Ashtead uses the US dollar instead of sterling to present its group results for clarity.
Rental revenue for the year was up by 22 per cent to $8,698 million or £6,964 million (2022: $7,235 million or £5,865 million).
The UK business generated rental only revenue of £429 million, up 6 per cent on the prior year (2022: £403 million). Excluding the impact of the work for the Department of Health during the pandemic, which ended during the first quarter of 2022/23, rental only revenue increased 22 per cent. Bolt-ons since 1 May 2021 contributed 9 per cent of this growth.
Rental revenue increased 3 per cent to £559 million (2022: £544 million) or 26 per cent excluding the impact of the work for the Department of Health. Total revenue decreased 6 per cent to £685 million (2022: £726 million) reflecting the high level of sales revenue associated with these projects, which overall accounted for only around 4 per cent of revenue in the year, compared with approximately 30 per cent of revenue last year.
The group described the year as one of transition in the UK as it redeployed assets dedicated to the Covid-19 testing centres elsewhere in the business, resulting in lower fleet utilisation than the previous year. During the year, the number of UK group locations increased to 185 from 177, with 4,250 employees up from 3,983.
Ashtead adds that, while it has managed to improve hire rates during the year, this has been insufficient to offset the inflation impact on the cost base. These factors, combined with a £4 million charge to impair a convertible loan note due from Britishvolt, the troubled vehicle battery manufacturer which entered administration in January, contributed to the UK generating an EBITDA margin of 28.1 per cent (2022: 29.6 per cent) and a segment profit of £65 million (2022: £87 million) at a margin of 9.5 per cent (2022: 12.0 per cent).
Ashtead's chief executive, Brendan Horgan, said: “We enter the final year of Sunbelt 3.0 [the group’s strategic growth plan] 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."
