RERMAG

Sunbelt Rentals Posts 25-Percent Revenue Increase for Fiscal Nine Months; Operating Profit Leaps 78 Percent

Sunbelt Rentals posted 25-percent revenue boost for the nine-month period ended Jan. 31, according to unaudited results filed by U.K.-based parent company Ashtead plc. Nine-month revenues for Sunbelt were $1.13 billion, compared with $903.7 million for the same period a year ago. EBITDA was $416.5 million, compared with $298 million a year ago, a 39.7-percent leap, while operating profit climbed 78.2 percent from $128.4 million for the first nine months of fiscal 2011 to $228.8 million this year.

For Ashtead as a whole, including its U.K.-based rental chain A-Plant, revenue increased 21 percent from £221.4 million in the fiscal third quarter a year ago, to £271.3 this year (about U.S. $425.9 million), and for the nine-month period, a 23-percent hike from £705.7 million a year ago to £846.8 million (about U.S. $1.33 billion).

EBITDA for the group jumped 36 percent year over year, from £220.5 million a year ago to £292.4 million (about U.S. $459.6 million) in the just-ended nine-month period.

“Once again, we are pleased to report a strong set of results,” said Ashtead chief executive Geoff Drabble. “Our record third-quarter pre-tax profit of £21 million (2011: £2 million loss), whilst undoubtedly being helped by favorable weather conditions, is predominantly due to the continuation of the momentum we have established over recent quarters. We continue to invest strongly in organic growth with our rental fleet now being 11-percent larger and an average of five months younger than a year ago.

“However, with a continued focus on margin improvement, this investment has been accompanied by a reduction in net debt to EBITDA leverage to 2.5 times (2011: 2.8 times). The board remains committed to a strategy of strong organic growth and continues to believe that we are well positioned to take advantage of a continuation of current market trends. We therefore now anticipate a full-year profit significantly ahead of our earlier expectations.”

The company said Sunbelt posted a 13-percent increase in average fleet on rent, 7-percent higher yield and a first-time contribution from Empire Scaffold. In the U.K., A-Plant’s rental revenue grew 11 percent, including 1 percent growth in average fleet on rent and 6-percent yield improvement.

Sunbelt Rentals’ fleet size on Jan. 31 was $2.3 billion, 10-percent larger than a year earlier, while average nine-month physical utilization grew to 72 percent, compared to 69 percent a year ago. For the fiscal year, the company expects to spend about £425 million on fleet.

The company added that February revenue and profit growth continued the pattern of the previous nine months.

Sunbelt Rentals, based in Fort Mill, S.C., is No. 3 on the RER 100. Parent company Ashtead is based in London.

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