North America’s second largest equipment rental company Sunbelt Rentals posted a 20.2-percent total volume increase for its full fiscal year 2014, ended April 30. In audited results released by parent company Ashtead plc, Sunbelt recorded $2,188.5 million compared to $1,819.9 million in the previous year.
Sunbelt Rentals’ sister company, U.K.-based A-Plant posted £268.5 million (about U.S. $455.1 million) for the year, compared to £206.1 million in fiscal 2013, a dramatic 30.3-percent leap.
Overall, group revenue for the year jumped 20 percent to £1.635 billion compared to £1.362 billion the previous year. The revenue growth, combined with ongoing operational efficiency improvements, generated a record underlying profit before tax of £362 million, compared to 2013’s restated total of £245 million, a 47.8-percent hike.
Sunbelt Rentals’ rental revenue jumped 23 percent to $1.973 billion, compared to $1.611 billion the previous year, driven by a 17-percent increase in fleet on rent and a 4-percent improvement in yield. Sunbelt focused on a balance between same-store growth, greenfield expansion and bolt-on acquisitions.
A-Plant’s rental revenue grew to £244 million, up 33 percent year over year from £183 million, benefitting from the acquisition of Eve Trakway. The improvement reflects 21 percent more fleet on rent and a 9-percent improvement on yield, which benefitted from an improved product mix. Rental revenue excluding Eve Trakway’s revenue still jumped 19 percent.
Sunbelt recorded a record EBITDA margin of 45 percent, as 65 percent of revenue growth dropped through to EBITDA, contributing to $631 million in operating profit, up from $453 million a year ago.
“2013-14 was a very successful year for the group, enabling us to deliver record 12-month underlying pre-tax profits of £362 million, up 50 percent from the prior year,” said Ashtead chief executive Geoff Drabble. “It is particularly pleasing that we achieved this growth whilst also delivering on our long-stated commitments of return on investment progression, now 19 percent for the group, and maintaining debt leverage below two times EBITDA. Our performance reflects the benefits of the consistent execution of our strategy focused largely on organic growth, supplemented by greenfield openings and bolt-on acquisitions. We invested £741 million in our rental fleet and a further £103 million on acquisitions during the year.
“We anticipate growing our fleet in the coming year in the low to mid teens percent range and will continue to open greenfields and make bolt-ons to further grow our market share and profitability. Current planning suggests around 50 new locations in the new financial year, another measured step towards our medium-term objective of 600 locations.”
Ashtead Group plc is based in London. Sunbelt Rentals, based in Fort Mill, S.C., is No. 2 on the RER 100.