The group, which owns A-Plant in the UK and Sunbelt Rentals in the US, said hire equipment demand rose in the early part of the recovery because companies were focusing limited resources on other areas.
Pre-tax profit rose 41 per cent to £30m in the six months to the end of October.
Chief executive Geoff Drabble said: “Clearly in a period where money is tight, people are renting more rather than owning it, and that’s what’s driving our improved performance.”
Sunbelt is the second largest US equipment rental business with 346 sites. A-Plant is the UK’s second biggest hire firm with 104 bases.
In the US, where Ashtead makes 80 per cent of its revenue, rental revenue from its Sunbelt unit grew four per cent, bucking a 14 per cent decline in the US non-housing construction market. The company, which hires out industrial equipment from diggers to small tools, said while rental revenues in the UK fell two per cent to £77m it was encouraged by “improving trends” throughout the first half.
Ashtead, whose shares rose 14.3p to 158p yesterday, predicted annual results would beat its own expectations.
“The momentum we have established during the year has continued into November and will, we expect, be sufficient to ensure an outcome ahead of our earlier expectations,” Drabble said.
UBS upgraded its 2010/11 forecast by 37 per cent and kept its “buy” rating.
“Results were ahead of expectations,” the broker said. “The second quarter represented the first quarter of revenue growth in this cycle for Ashtead and it could well accelerate from here.” Ashtead expects to spend around £225m this year, mainly on fleet replacement.