Leading U.K. and Middle East aerial rental company Lavendon Group said this week that the company has performed better than expectations in the first half of 2011 ended June 30. The company said overall revenues on a constant currency basis grew 8 percent compared with the first half of 2010, with the second quarter group revenues increasing 6 percent compared with a year ago.
U.K. revenues jumped 10 percent as did Germany, with the best results coming from Belgium and France at 17 percent and 16 percent respectively. Middle East revenues declined by 2 percent.
Despite a 5-percent increase in its operations in Spain, the company said it plans to exit the Spanish market during the second half of 2011. “Due to the weak long-term outlook for our market in Spain, we have concluded that the capital currently invested in our Spanish operation will achieve better returns if substantially redeployed to our other markets,” the company said in a statement. “Consequently we have made a strategic decision to exit the Spanish powered-access market during the second half of 2011 at a cost of approximately £5 million.” Lavendon said net cash costs of leaving Spain will be about £1.25 million after the disposal of fleet not redeployed to other markets.
The company said revenue growth has driven a marked improvement in profitability in the first half, leading to increased operating margins and returns on capital.
“The first half has seen a solid improvement in both revenues and margins,” the company added. “Whilst mindful of the continuing economic uncertainties, we believe that if the current momentum in our underlying trading is maintained, coupled with the anticipated improvement in our operational efficiency, the results for the year will exceed the board’s previous expectations.”
Lavendon Group is based in Lutterworth, Leicestershire, England.