HSS profits fall as rapid growth hits bottom line at hire group
HSS HIRE group saw its 2014 pre-tax profits plunge, it was revealed yesterday as increased expenditure undermined growing revenues.
The machine hire firm, which listed on the FTSE main market in February, saw rapid expansion in the year ending 27 December, investing £30m on growing its specialist hire fleet. In addition, the company acquired Apex Generators in March 2014 for £6m and invested in enlarging its sales staff.
Furthermore, the group was forced to refinance £6.6m of debt, a situation the firm seeks to rectify by using a portion of the £110m proceeds from its float to reduce future leverage.
HSS saw revenues surge 25 per cent during the period to £284.6m with increased demand coming from both new and existing customers with past acquisitions also contributing to sales growth.
But the rise in revenues was not enough to offset the increased expenditure during the period, and the company recorded a pre-tax loss of £8.5m compared with a modest profit of £2.6m in 2013.