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Ashtead Group

Ashtead Group PLC delivered a strong quarter with rental revenue increase

Ashtead Group PLC (LON:AHT), today announced unaudited results for Q1 ended 31 July 2018.

2018

2017

Growth1

£m

£m

%

Underlying results2

Rental revenue

961.0

828.8

19%

EBITDA

503.7

431.1

20%

Profit before taxation

285.6

238.5

23%

Earnings per share

44.8p

31.5p

46%

Statutory results

Revenue

1,047.4

880.1

22%

Profit before taxation

274.4

228.9

23%

Profit after taxation

209.9

150.0

44%

Earnings per share

43.0p

30.2p

47%

Highlights

· Revenue up 22%1; rental revenue up 19%1

· Pre-tax profit2 of £286m (2017: £238m)

· Earnings per share2 up 46%1 to 44.8p (2017: 31.5p)

· Post-tax profit of £210m (2017: £150m)

· £465m of capital invested in the business (2017: £377m)

· £51m of free cash flow generation3 (2017: £51m)

· £145m spent on bolt-on acquisitions (2017: £116m)

· Net debt to EBITDA leverage1 of 1.6 times (2017: 1.7 times)

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

2 Underlying results are stated before intangible amortisation.

3 Throughout this announcement we refer to a number of alternative performance measures which are defined in the Glossary on page 25.

Ashtead Group,  chief executive, Geoff Drabble, commented:

“The Group delivered a strong quarter with rental revenue increasing 19% and underlying pre-tax profit increasing 23% to £286m, both at constant exchange rates.

Our end markets remain strong and are supported by continued structural change as customers rely increasingly on rental while we leverage the benefits of scale. We continue to execute well on our strategy through a combination of organic growth and bolt-on acquisitions, investing £465m by way of capital expenditure and £145m on bolt-on acquisitions in the quarter.

Our strong margins and lower replacement capital expenditure are delivering good earnings growth and significant free cash flow generation. This provides us with significant operational and financial flexibility, enabling us to invest in the long-term structural growth opportunity and enhance returns to shareholders while maintaining leverage within our target range of 1.5 to 2.0 times net debt to EBITDA.

We have spent £300m to date under the share buyback programme announced in December 2017. In line with our capital allocation priorities we have decided to increase and extend our current buyback plans. The level of share buyback will be increased to £125m per quarter resulting in a total outlay of £675m under the programme announced in December 2017. The programme will be extended for financial year 2019/20 with an anticipated spend of at least £500m.

Our business is performing well in supportive end markets. With the benefit of weaker sterling, we expect full year results to be ahead of our expectations and the Board continues to look to the medium term with confidence.”