Speedy Hire revenue surges as it watches macro conditions

Tools and equipment specialist Speedy Hire reported a significant increase in statutory revenue in its full-year results on Thursday, up 13.9% to £440.6m.

The company did, however, report an 88% tumble in statutory operating profit for the year ended 31 March, to £3.8m, while profit before tax saw a substantial decrease of 93.8% to £1.8m.

Its basic earnings per share suffered a decline of 93.9%, to 0.25p on a statutory basis.

Looking at the underlying results excluding disposals, Speedy Hire’s revenue was ahead 13.8% at £434.3m, and EBITDA improved 4.4% to £103.7m.

Adjusted profit before tax gained 6.6% to £32.1m, and adjusted earnings per share grew 23.8%, to 5.25p for the fiscal year.

In terms of other measures, Speedy Hire generated free cash flow of £10.6m in the 2023 fiscal year, swinging from an outflow of £18.5m in the prior year.

The company's net debt widened by £24.9m, however, to reach £92.4m by the end of March.

Its return on capital employed improved by 0.9 percentage points to 14.5%, while the Speedy Hire board declared a dividend of 2.6p for the year, representing an increase of 18.2% from last year's dividend of 2.2p.

Operationally, Speedy Hire announced the launch of its new five-year transformation and growth strategy called ‘Velocity’, which was designed to prioritise revenue growth and margin improvement.

The company added that it had enhanced its trade and retail opportunities through new agreements with B&Q.

Additionally, Speedy Hire said it had set itself a target to become a net-zero business by 2040, surpassing the government's target by 10 years.

On its outlook, Speedy expressed confidence in meeting its expectations for the upcoming year, thanks to recent key contract wins, extensions, and a strong pipeline.

However, the board said it remained cautious and vigilant regarding the challenges presented by the macro-economic climate.

“I am pleased to report results that reflect the strong performance we have achieved this year,” said chief executive officer Dan Evans.

“We are excited about executing on our new growth strategy, Velocity, which provides clear direction for the business and we expect it to deliver long term benefits to our customers, our people and our investors.

“We have made an encouraging start to the 2024 financial year, with a strong pipeline of new customer and project based opportunities.”

At 0823 BST, shares in Speedy Hire were up 0.16% at 30.5p.

Reporting by Josh White for Sharecast.com.