Ashtead Group achieves strong market outperformance

Growth

Ashtead Group Plc (LON:AHT) has announced its audited results for the year and unaudited results for the fourth quarter ended 30 April 2021.

Fourth quarter
2021
£m
Fourth quarter
2020
£m
Fourth quarter
Growth1
%
Year
2021
£m
Year
2020
£m
Year
Growth1
%
Revenue1,2711,12523%5,0315,0543%
Rental revenue1,0981,03915%4,4734,6061%
EBITDA55246430%2,3012,3761%
Operating profit26415595%1,1351,224-3%
Adjusted2 profit before taxation235114133%9981,061-2%
Profit before taxation22098158%936983-1%
Adjusted2 earnings per share38.8p20.2p122%166.0p175.0p-1%
Earnings per share36.3p17.4p143%155.7p162.1p1%

Full-year highlights3

·       Strong market outperformance

·       Revenue up 3%1; rental revenue up 1%1

·       Operating profit of £1,135m (2020: £1,224m)

·       Adjusted pre-tax profit of £998m (2020: £1,061m)

·       Adjusted earnings per share of 166.0p (2020: 175.0p)

·       £718m of capital invested in the business (2020: £1.5bn)

·       Record free cash flow of £1,382m (2020: £792m)

·       £125m spent on bolt-on acquisitions (2020: £453m)

·       Net debt to EBITDA leverage1,3 of 1.4 times (2020: 1.9 times)

·       Proposed final dividend of 35.0p, making 42.15p for the full year (2020: 40.65p)

·       Sunbelt 3.0, the next phase of our strategic plan, launched in April

1 Calculated at constant exchange rates applying current period exchange rates.

2 Adjusted results are stated before exceptional items and amortisation.

3 Throughout this announcement we refer to a number of alternative performance measures which provide additional useful information. The directors have adopted these to provide additional information on the underlying trends, performance and position of the Group. The alternative performance measures are not defined by IFRS and therefore may not be directly comparable with other companies’ alternative performance measures, but are defined and reconciled in the Glossary on page 39.

Ashtead Group’s chief executive, Brendan Horgan, commented:

“We returned to growth in the fourth quarter with rental revenue up 15% over last year and up 14% when compared with the fourth quarter of 2018/19, both at constant exchange rates.  This completes a year of market outperformance across the business with full year rental revenue up 1% at constant exchange rates.  I am extraordinarily proud of, and grateful to, all our dedicated team members who have made this possible, delivering for all our stakeholders, all while keeping our leading value of safety at the forefront of what we do.

Our performance this year illustrates the benefits of our long-term strategy to broaden and diversify our end markets and strengthen our balance sheet.  This has enabled us to capitalise on our increasing scale while, at the same time, maintaining the business’ agility.  The last year has proven the strength in our business model during a difficult period in the economic cycle, through responding in the manner we did to the challenges arising as a result of the pandemic.  Our performance during this period resulted in record free cash flow for the twelve months of £1,382m (2020: £792m) contributing to reduced leverage of 1.4 times compared to 1.9 times a year ago and adjusted pre-tax profit of £998m, only 2% lower than a  year ago on a constant currency basis.

We have shown that our business can perform in both good times and more challenging ones.  We enter the new financial year with clear momentum, strong positions in all our markets, supported by high quality fleet, a strong financial position and our exciting new Sunbelt 3.0 strategic plan, positioning us well to respond to market conditions and capitalise on opportunities.  We will invest to drive long-term sustainable growth and returns and strengthen the business.  The benefit we derive from the diversity of our products, services and end markets, our investment in technology and ongoing structural change, enhanced by the environmental and social aspects of ESG, enables the Board to look to the future with confidence.”

Brendan Horgan and Michael Pratt will hold a conference call for equity analysts to discuss the results and outlook at 10am on Tuesday, 15 June 2021.  The call will be webcast live via the Company’s website at www.ashtead-group.com and a replay will be available via the website shortly after the call concludes.  A copy of this announcement and the slide presentation used for the call are available for download on the Company’s website.  The usual conference call for bondholders will begin at 3:30pm (10:30am EST).

Analysts and bondholders have already been invited to participate in the analyst call and conference call for bondholders but any eligible person not having received details should contact the Company’s PR advisers, Maitland/AMO (Audrey Da Costa) at +44 (0)20 7379 5151.

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