Speedy Hire is revelling in sustained strong trading performance and is set to deliver full-year results ahead of marketing expectations, as the construction rental equipment specialists looks to embrace the consumer market.
The firm’s CEO, Russell Down, is looking to maximise the “untapped potential” of homeowners pursuing their own projects.
It has now signed a new agreement with B&Q, and will operate in 23 further stores in the second half of this year.
Overall, it will feature in 40 of the home makeover giant’s locations across the country.
The company has reported £186.2m half-year revenues, following 28.2 per cent year-on-year growth.
Its adjusted operating profits have also increased from £4.1m to £14.6m, while net debt is down from £57.8m to £47.9m.
In good news for investors, adjusted earnings per share have more-than trebled, rocketing from 53p a share to £1.81.
The group has managed further market share gains with a number of new contracts and renewals with key customers including Costain, MGroup, Redrow Homes and Willmott Dixon.
Speedy Hire has also invested £37.6m in a hire fleet of construction vehicles with a focus on carbon efficient ECO products.
The company considers the results ahead of current market expectations, with market conditions remaining positive.
Commenting on the results, Down told City A.M. “It was very good first half year, the markets are very positive. We’ve got lots of infrastructure spend out there from HS2, Hinkley Point, Thames Tideway and lots of rail and water work. Revenues are up compared to where it was two years ago, and significantly up compared to where it was last year when we were in the pandemic, with adjusted operating profit over 250 per cent. So, we’re very pleased with the results we report today and the business continues to be well managed.”
Speedy Hire’s shares have risen 5.64 per cent on the FTSE All-Share.
Analysts at Panmure Gordon believe the company is benefitting from “robust demand” and recommends buying the stock at at a target price of 113p.
They believe the stock is particularly attractive due to the strong service the company offers – with four hour turnaround times for requested products.
The performance note said: “Superior service levels continue to be a key factor driving these market share gains. As the construction cycle progresses, we anticipate that the importance of service will trend even higher. In particular, we expect that clients will increasingly emphasise equipment availability and reliability over price. In this environment, Speedy Hire is well placed to benefit and we expect sales, margins and returns to all move higher.”