REG - Ashtead Group PLC - Unaudited results for 9 months & Q3 ended 31/1/25
04/03/2025 07:00
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RNS Number : 1766Z Ashtead Group PLC 04 March 2025
4 March 2025
Unaudited results for the nine months and
third quarter ended 31 January 2025
Performance(1) Third quarter Nine months
2025 2024 Growth(2) 2025 2024 Growth(2)
$m $m % $m $m %
Revenue 2,568 2,658 -3% 8,262 8,231 - %
Rental revenue 2,381 2,356 1% 7,646 7,317 5%
Adjusted(3) EBITDA 1,177 1,168 1% 3,874 3,752 3%
Operating profit 550 591 -7% 2,034 2,093 -3%
Adjusted(3) profit before taxation 443 473 -6% 1,698 1,785 -5%
Profit before taxation 409 442 -7% 1,606 1,692 -5%
Adjusted(3) earnings per share 77.2¢ 81.4¢ -5% 290.8¢ 307.2¢ -5%
Earnings per share 70.9¢ 76.1¢ -6% 274.6¢ 291.4¢ -6%
Nine month highlights
· Group rental revenue up 5%(2); revenue flat; US rental revenue
up 4%; revenue flat
· Operating profit of $2,034m (2024: $2,093m), with $108m lower
gains on disposal
· Adjusted(3) profit before taxation of $1,698m (2024: $1,785m)
· Adjusted(3) earnings per share of 290.8¢ (2024: 307.2¢)
· $2.1bn of capital invested in the business (2024: $3.5bn)
· Free cash inflow(1) of $858m (2024: outflow of $463m)
· Net debt to adjusted EBITDA leverage(2) of 1.7 times (2024: 1.9
times)
· We expect full year results in line with our previous
expectations
(1) Throughout this announcement we refer to a number of alternative performance
measures which provide additional useful information. The directors have
adopted these to provide additional information on the underlying trends,
performance and position of the Group. The alternative performance measures
are not defined by IFRS and therefore may not be directly comparable with
other companies' alternative performance measures but are defined and
reconciled in the Glossary of Terms on page 29.
(2) Calculated at constant exchange rates applying current period exchange rates.
(3) Adjusted results are stated before amortisation and non-recurring costs
associated with the move of the Group's primary listing to the US.
Ashtead's chief executive, Brendan Horgan, commented:
The business is focused on executing against the five actionable components of
our Sunbelt 4.0 strategic growth plan: Customer; Growth; Performance;
Sustainability and Investment. I want to thank all our team members for the
hard work and professionalism they exhibit every day as we deliver on this
strategy and our commitment to provide exceptional service to our customers,
safely.
The Group delivered record nine month rental revenue and EBITDA, with growth
of 5% and 3% respectively. In North America, the strength of mega projects
and hurricane response efforts have more than offset the lower activity levels
in local commercial construction markets. These local construction markets
have been affected by the prolonged higher interest rate environment. However,
underlying demand continues to be strong and we expect this segment to recover
as interest rates stabilise. Adjusted profit before taxation was $1,698m
(2024: $1,785m) with the difference, as expected, a result of lower used
equipment sales resulting in gains on sale of $58m (2024: $165m).
The investments in and expansion of the business over Sunbelt 3.0 and into
Sunbelt 4.0 are enabling us to take advantage of the diverse opportunities
that we see while maintaining discipline and balance sheet strength that
affords us considerable flexibility and optionality. In the period we
invested $2.1bn in capital across existing locations and greenfields and $56m
on three bolt-ons, adding a total of 54 new locations in North America.
We are in a position of strength, with the operational flexibility and
financial capacity to take advantage of the ongoing structural growth
opportunities we see for the business and enhance returns to shareholders as
we follow our Sunbelt 4.0 plan. We expect full year results in line with our
previous expectations and the Board looks to the future with confidence.
Contacts:
Will Shaw Director of Investor Relations +44 (0)20 7726 9700
Sam Cartwright H/Advisors Maitland +44 (0)20 7379 5151
Brendan Horgan and Alex Pease will hold a conference call for equity analysts
to discuss the results and outlook at 12pm (7am EST) on Tuesday, 4 March
2025. The call will be webcast live via the Company's website at
www.ashtead-group.com (http://www.ashtead-group.com) and a replay will be
available via the website shortly after the call concludes. A copy of this
announcement and the slide presentation used for the call are available for
download on the Company's website. The usual conference call for bondholders
will begin at 3pm (10am EST).
Analysts and bondholders have already been invited to participate in the
analyst and bondholder calls but any eligible person not having received
details should contact the Company's PR advisers, H/Advisors Maitland (Audrey
Da Costa) at +44 (0)20 7379 5151.
Forward-looking statements
This announcement contains forward-looking statements. These have been made
by the directors in good faith using information available up to the date on
which they approved this report. The directors can give no assurance that
these expectations will prove to be correct. Due to the inherent
uncertainties, including both business and economic risk factors underlying
such forward-looking statements, actual results may differ materially from
those expressed or implied by these forward-looking statements. Except as
required by law or regulation, the directors undertake no obligation to update
any forward-looking statements whether as a result of new information, future
events or otherwise.
Nine months' trading results
Revenue Adjusted EBITDA Profit(1)
2025 2024 2025 2024 2025 2024
Canada in C$m 733.4 675.6 326.9 271.9 139.4 105.7
UK in £m 536.4 523.7 153.4 146.3 43.6 41.3
US 7,046.5 7,072.1 3,467.2 3,391.7 1,996.0 2,081.2
Canada in $m 529.6 501.3 236.0 201.8 100.7 78.4
UK in $m 686.3 657.8 196.2 183.7 55.7 51.9
Group central costs - - (25.0) (25.7) (25.8) (26.4)
8,262.4 8,231.2 3,874.4 3,751.5 2,126.6 2,185.1
Financing costs (428.3) (400.3)
Adjusted profit before tax 1,698.3 1,784.8
Non-recurring costs (5.8) -
Amortisation (86.5) (92.3)
Profit before taxation 1,606.0 1,692.5
Taxation charge (406.8) (418.8)
Profit attributable to equity holders of the Company 1,199.2 1,273.7
Margins
US 49.2% 48.0% 28.3% 29.4%
Canada 44.6% 40.2% 19.0% 15.7%
UK 28.6% 27.9% 8.1% 7.9%
Group 46.9% 45.6% 25.7% 26.5%
(1) Adjusted operating profit.
Group revenue was $8,262m (2024: $8,231m) in the nine months. This revenue
and our focus on the cost base resulted in adjusted EBITDA increasing 3% to
$3,874m (2024: $3,752m), but with lower used equipment sales and after higher
depreciation and interest costs, adjusted operating profit decreased 3% to
$2,127m (2024: $2,185m) and adjusted profit before tax was $1,698m
(2024: $1,785m). The higher increase in the depreciation charge relative to
revenue growth reflects lower utilisation of a larger fleet and the ongoing
impact of life cycle fleet inflation, contributing to the decline in operating
profit. In addition, increased financing costs due to higher average debt
levels resulted in adjusted profit before tax being 5% lower than the
comparative period.
In the US, rental only revenue of $5,203m (2024: $4,993m) was 4% higher than
the prior year, driven by both volume and rate improvement. Organic growth
(same-store and greenfields) was 3%, while bolt-ons since 1 May 2023
contributed 1% of rental only revenue growth. In the nine months, our
General Tool business grew 1%, while our Specialty businesses grew 14%,
demonstrating the benefits of our strategy of growing our Specialty businesses
and broadening our end markets. Rental revenue increased 4% to $6,578m
(2024: $6,337m). We estimate that hurricane response efforts contributed
$90 - 100m to rental revenue in the period. This hurricane impact, in part,
mitigated the weaker local commercial construction market. US total revenue,
including new and used equipment, merchandise and consumable sales, was
$7,047m (2024: $7,072m). As expected, this reflects a lower level of used
equipment sales than last year when we took advantage of improving fleet
deliveries and strong second-hand markets to catch up on deferred disposals.
We invested in the infrastructure of the business during Sunbelt 3.0 to
support the growth of the business now and into the future. Our intention is
to leverage this infrastructure during Sunbelt 4.0 as we look to improve
operating performance. This, combined with our focus on the cost base and
lower scaffold erection and dismantling revenue, contributed to US rental
revenue drop through to EBITDA of 71% for the period. This resulted in an
EBITDA margin of 49.2% (2024: 48.0%). Lower used equipment sales and weaker
second-hand values resulted in lower gains on sale. This, combined with higher
depreciation on a larger fleet, contributed to segment profit decreasing by 4%
to $1,996m (2024: $2,081m) with a margin of 28.3% (2024: 29.4%).
Canada's rental only revenue increased 16% to C$530m (2024: C$457m). Markets
relating to the major part of the Canadian business are performing in a manner
similar to the US with volume growth and rate improvement. In addition,
following settlement of the Writers Guild of America and Screen Actors Guild
strikes, activity in the Specialty Film & TV business has recovered,
although it is below pre-strike levels, which is likely to be the new normal.
Rental revenue increased 16% to C$662m (2024: C$573m), while total revenue
was C$733m (2024: C$676m).
Our Canadian business continues to develop and invest to expand its network
and broaden its markets. This, combined with the recovery in the Film &
TV business, contributed to an EBITDA margin of 44.6% (2024: 40.2%) and a
segment profit of C$139m (2024: C$106m) at a margin of 19.0% (2024: 15.7%).
The UK business generated rental only revenue of £357m, up 2% on the prior
year (2024: £350m). Rental only revenue growth has been driven by both
rate and volume improvement. Rental revenue increased 4% to £461m
(2024: £441m), while total revenue increased 2% to £536m (2024: £524m).
In the UK, the focus remains on delivering operational efficiency and
long-term, sustainable returns in the business. While we continue to improve
rental rates, this remains an area of focus. The UK generated an EBITDA
margin of 28.6% (2024: 27.9%) and a segment profit of £44m (2024: £41m) at
a margin of 8.1% (2024: 7.9%).
Overall, Group adjusted operating profit decreased to $2,127m (2024:
$2,185m). After increased financing costs of $428m (2024: $400m),
reflecting higher average debt levels, Group adjusted profit before tax was
$1,698m (2024: $1,785m). After a tax charge of 25% (2024: 25%) of the
adjusted pre-tax profit, adjusted earnings per share were 290.8ȼ (2024:
307.2ȼ).
Statutory profit before tax was $1,606m (2024: $1,692m). This is after
non-recurring costs of $6m (2024: $nil) associated with the move of the
Group's primary listing to the US and amortisation of $86m (2024:
$92m). Included within the total tax charge is a tax credit of $22m (2024:
$23m) which relates to the amortisation of intangibles and non-recurring
costs. As a result, basic earnings per share were 274.6¢ (2024: 291.4¢).
Capital expenditure and acquisitions
Capital expenditure for the nine months was $2,141m gross and $1,741m net of
disposal proceeds (2024: $3,509m gross and $2,848m net). As a result, the
Group's rental fleet at 31 January 2025 at cost was $18bn and our average
fleet age was 47 months (2024: 46 months) on an original cost basis.
We invested $56m (2024: $906m) in three bolt-on acquisitions during the nine
months, as we continue to both expand our footprint and diversify our end
markets. Further details are provided in Note 15.
Return on Investment
The Group return on investment was 15% (2024: 17%). In the US, return on
investment (excluding goodwill and intangible assets) for the 12 months to 31
January 2025 was 20% (2024: 25%), while in Canada it was 12% (2024: 12%).
The reduction in US return on investment reflects principally the impact of
lower utilisation of a larger fleet. In the UK, return on investment
(excluding goodwill and intangible assets) was 7% (2024: 6%). Return on
investment excludes the impact of IFRS 16.
Cash flow and net debt
The Group generated free cash flow of $858m (2024: outflow of $463m) during
the period, which is after capital expenditure payments of $2,434m (2024:
$3,752m). During the period, we spent $88m on share buybacks.
Net debt at 31 January 2025 was $10,607m (2024: $11,166m). Excluding the
effect of IFRS 16, net debt at 31 January 2025 was $7,860m (2024: $8,563m),
while the ratio of net debt to adjusted EBITDA was 1.7 times (2024: 1.9
times) on a constant currency basis. The Group's target range for net debt to
adjusted EBITDA is 1.0 to 2.0 times, excluding the impact of IFRS 16.
Including the effect of IFRS 16, the ratio of net debt to adjusted EBITDA was
2.1 times (2024: 2.3 times) on a constant currency basis.
At 31 January 2025, availability under the senior secured debt facility was
$3,174m with an additional $6,434m of suppressed availability - substantially
above the $475m level at which the Group's entire debt package is covenant
free.
The Group's debt facilities are committed for an average of six years at a
weighted average cost of 5%.
Capital allocation
The Group remains disciplined in its approach to allocation of capital with
the overriding objective being to enhance shareholder value.
Our capital allocation framework remains unchanged and prioritises:
· organic fleet growth;
- same-stores;
- greenfields;
· bolt-on acquisitions; and
· a progressive dividend with consideration to both profitability and
cash generation that is sustainable through the cycle.
Additionally, we consider further returns to shareholders. In this regard,
we assess continuously our medium-term plans which take account of investment
in the business, growth prospects, cash generation, net debt and leverage.
As we execute on Sunbelt 4.0, we expect a number of years of strong earnings
and free cash flow generation. Given this outlook, we have the opportunity to
enhance returns to shareholders, while maintaining leverage towards the middle
of our target range of 1.0 to 2.0 times net debt to adjusted EBITDA (excluding
the IFRS 16).
Current trading and outlook
We are in a position of strength, with the operational flexibility and
financial capacity to take advantage of the ongoing structural growth
opportunities we see for the business and enhance returns to shareholders as
we follow our Sunbelt 4.0 plan. We expect full year results in line with our
previous expectations and the Board looks to the future with confidence.
Previous Current
guidance guidance
Rental revenue(1)
- Group 3 to 5% 3 to 5%
- US 2 to 4% 2 to 4%
- Canada 15 to 19% 9 to 13%
- UK 3 to 6% 3 to 6%
Capital expenditure (gross)(2) $2.5 - 2.7bn $2.5 - 2.7bn
Free cash flow(2) c. $1.4bn c. $1.4bn
( )
(1) Represents change in year-over-year rental revenue at constant exchange
rates
(2) Stated at C$1=$0.75 and £1=$1.27
CONSOLIDATED INCOME STATEMENT
FOR THE THREE AND NINE MONTHS ENDED 31 JANUARY 2025
Unaudited
Three months to Nine months to
31 January 31 January
2025 2024 2025 2024
$m $m $m $m
Revenue
Rental revenue 2,380.8 2,356.3 7,646.1 7,316.7
Sale of new equipment,
merchandise and consumables 79.0 81.8 260.7 278.6
Sale of used rental equipment 108.1 219.7 355.6 635.9
2,567.9 2,657.8 8,262.4 8,231.2
Operating costs
Staff costs (593.4) (629.2) (1,861.4) (1,882.5)
Other operating costs (718.1) (693.5) (2,234.6) (2,126.8)
Used rental equipment sold (85.7) (166.9) (297.8) (470.4)
(1,397.2) (1,489.6) (4,393.8) (4,479.7)
EBITDA* 1,170.7 1,168.2 3,868.6 3,751.5
Depreciation (592.3) (546.6) (1,747.8) (1,566.4)
Amortisation of intangibles (28.6) (31.0) (86.5) (92.3)
Operating profit 549.8 590.6 2,034.3 2,092.8
Interest income 0.1 0.6 0.1 1.6
Interest expense (140.9) (149.2) (428.4) (401.9)
Profit on ordinary activities
before taxation 409.0 442.0 1,606.0 1,692.5
Taxation (99.3) (109.7) (406.8) (418.8)
Profit attributable to equity
holders of the Company 309.7 332.3 1,199.2 1,273.7
Basic earnings per share 70.9¢ 76.1¢ 274.6¢ 291.4¢
Diluted earnings per share 70.9¢ 75.6¢ 273.8¢ 289.8¢
* EBITDA is presented here as an alternative performance measure as it is
commonly used by investors and lenders. This and other adjusted alternative
performance measures are detailed in the Glossary of Terms on page 29.
All revenue and profit is generated from continuing operations.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE THREE AND NINE MONTHS ENDED 31 JANUARY 2025
Unaudited
Three months to Nine months to
31 January 31 January
2025 2024 2025 2024
$m $m $m $m
Profit attributable to equity holders of the Company 309.7 332.3 1,199.2 1,273.7
Items that will not be reclassified subsequently to profit or loss:
Movement on equity instruments held at fair value - - (25.5) -
Tax on movement on equity instruments held at fair value - - 2.7 -
- - (22.8) -
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences (61.1) 63.0 (51.4) 22.8
Loss on cash flow hedge 0.1 0.1 0.2 0.2
(61.0) 63.1 (51.2) 23.0
Total other comprehensive income for the period (61.0) 63.1 (74.0) 23.0
Total comprehensive income for the period 248.7 395.4 1,125.2 1,296.7
CONSOLIDATED BALANCE SHEET AT 31 JANUARY 2025
Unaudited Audited
31 January 30 April
2025 2024 2024
$m $m $m
Current assets
Inventories 154.0 192.5 162.0
Trade and other receivables 1,956.7 2,007.2 1,850.2
Current tax asset 70.2 38.0 13.0
Cash and cash equivalents 25.8 22.4 20.8
2,206.7 2,260.1 2,046.0
Non-current assets
Property, plant and equipment
- rental equipment 11,543.9 11,356.9 11,450.8
- other assets 1,915.0 1,721.2 1,797.7
13,458.9 13,078.1 13,248.5
Right-of-use assets 2,475.2 2,402.7 2,425.6
Goodwill 3,216.1 3,263.4 3,211.5
Other intangible assets 394.2 538.9 485.9
Other non-current assets 181.5 171.4 189.3
Current tax asset - 45.3 44.5
Net defined benefit pension plan asset - 19.3 -
19,725.9 19,519.1 19,605.3
Total assets 21,932.6 21,779.2 21,651.3
Current liabilities
Trade and other payables 1,188.0 1,336.6 1,482.9
Current tax liability 7.7 12.8 10.1
Lease liabilities 288.6 268.4 273.8
Provisions 45.4 45.7 42.5
1,529.7 1,663.5 1,809.3
Non-current liabilities
Lease liabilities 2,496.4 2,373.9 2,406.8
Long-term borrowings 7,848.1 8,545.8 7,995.1
Provisions 77.7 70.5 75.4
Deferred tax liabilities 2,250.6 2,176.4 2,224.2
Other non-current liabilities 69.9 57.9 55.5
Net defined benefit pension plan liability 0.4 - 0.4
12,743.1 13,224.5 12,757.4
Total liabilities 14,272.8 14,888.0 14,566.7
Equity
Share capital 81.8 81.8 81.8
Share premium account 6.5 6.5 6.5
Capital redemption reserve 20.0 20.0 20.0
Own shares held by the Company (912.1) (801.2) (818.7)
Own shares held by the ESOT (35.0) (43.5) (43.5)
Cumulative foreign exchange translation differences (314.9) (223.1) (263.5)
Retained reserves 8,813.5 7,850.7 8,102.0
Equity attributable to equity holders of the Company 7,659.8 6,891.2 7,084.6
Total liabilities and equity 21,932.6 21,779.2 21,651.3
Contingent consideration liabilities have been re-classified from current and
non-current provisions to trade and other payables and other non-current
liabilities in the January 2024 comparative period.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE NINE MONTHS ENDED 31 JANUARY 2025
Own Own Cumulative
shares shares foreign
Share Capital held by held exchange
Share premium redemption the by translation Retained
the ESOT
capital account reserve Company differences reserves Total
$m $m $m $m $m $m $m $m
Unaudited
At 1 May 2023 81.8 6.5 20.0 (740.9) (38.8) (245.9) 6,925.3 6,008.0
Profit for the period - - - - - - 1,273.7 1,273.7
Other comprehensive income:
Foreign currency
translation differences - - - - - 22.8 - 22.8
Loss on cash flow hedge - - - - - - 0.2 0.2
Total comprehensive income
for the period - - - - - 22.8 1,273.9 1,296.7
Dividends paid - - - - - - (368.3) (368.3)
Own shares purchased
by the ESOT - - - - (29.9) - - (29.9)
Own shares purchased
by the Company - - - (60.3) - - - (60.3)
Share-based payments - - - - 25.2 - 12.3 37.5
Tax on share-based payments - - - - - - 7.5 7.5
At 31 January 2024 81.8 6.5 20.0 (801.2) (43.5) (223.1) 7,850.7 6,891.2
Profit for the period - - - - - - 324.7 324.7
Other comprehensive income:
Foreign currency translation differences
- - - - - (40.4) - (40.4)
Remeasurement of the defined benefit pension plan
- - - - - - (22.6) (22.6)
Tax on defined benefit
pension scheme - - - - - - 5.6 5.6
Total comprehensive income
for the period - - - - - (40.4) 307.7 267.3
Dividends paid - - - - - - (68.3) (68.3)
Own shares purchased by
the Company - - - (17.5) - - - (17.5)
Share-based payments - - - - - - 10.0 10.0
Tax on share-based payments - - - - - - 1.9 1.9
At 30 April 2024 81.8 6.5 20.0 (818.7) (43.5) (263.5) 8,102.0 7,084.6
Profit for the period - - - - - - 1,199.2 1,199.2
Other comprehensive income:
Foreign currency translation
differences - - - - - (51.4) - (51.4)
Loss on cash flow hedge - - - - - - 0.2 0.2
Movement on equity instruments held at fair value
- - - - - - (25.5) (25.5)
Tax on movement on equity instruments held at fair value
- - - - - - 2.7 2.7
Total comprehensive income
for the period - - - - - (51.4) 1,176.6 1,125.2
Dividends paid - - - - - - (389.8) (389.8)
Own shares purchased
by the ESOT - - - - (85.3) - - (85.3)
Own shares purchased
by the Company - - - (93.4) - - - (93.4)
Share-based payments - - - - 93.8 - (72.8) 21.0
Tax on share-based payments - - - - - - (2.5) (2.5)
At 31 January 2025 81.8 6.5 20.0 (912.1) (35.0) (314.9) 8,813.5 7,659.8
CONSOLIDATED CASH FLOW STATEMENT FOR THE NINE MONTHS ENDED 31 January 2025
Unaudited
2025 2024
$m $m
Cash flows from operating activities
Cash generated from operations before
changes in rental equipment 3,723.6 3,321.5
Payments for rental property, plant and equipment (2,054.1) (3,231.8)
Proceeds from disposal of rental property,
plant and equipment 303.7 522.9
Cash generated from operations 1,973.2 612.6
Financing costs paid (403.4) (369.0)
Tax paid (378.6) (233.2)
Net cash generated from operating activities 1,191.2 10.4
Cash flows from investing activities
Acquisition of businesses (68.0) (862.9)
Financial asset investments - (5.0)
Payments for non-rental property, plant and equipment (379.4) (520.2)
Proceeds from disposal of non-rental
property, plant and equipment 44.9 47.3
Net cash used in investing activities (402.5) (1,340.8)
Cash flows from financing activities
Drawdown of loans 979.5 3,480.4
Redemption of loans (1,101.8) (1,603.5)
Repayment of principal under lease liabilities (100.1) (96.3)
Dividends paid (387.4) (367.7)
Purchase of own shares by the ESOT (85.2) (29.9)
Purchase of own shares by the Company (88.1) (60.3)
Net cash (used in)/generated from financing activities (783.1) 1,322.7
Increase/(decrease) in cash and cash equivalents 5.6 (7.7)
Opening cash and cash equivalents 20.8 29.9
Effect of exchange rate differences (0.6) 0.2
Closing cash and cash equivalents 25.8 22.4
Reconciliation of net cash flows to net debt
(Increase)/decrease in cash and
cash equivalents in the period (5.6) 7.7
(Decrease)/increase in debt through cash flow (222.4) 1,780.6
Change in net debt from cash flows (228.0) 1,788.3
Exchange differences (47.7) 21.0
Debt acquired 18.7 154.5
Deferred costs of debt raising 7.4 3.9
New lease liabilities 202.0 238.5
(Decrease)/increase in net debt in the period (47.6) 2,206.2
Net debt at 1 May 10,654.9 8,959.5
Net debt at 31 January 10,607.3 11,165.7
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
1. General information
Ashtead Group plc ('the Company') is a company incorporated and domiciled in
England and Wales and listed on the London Stock Exchange. The condensed
consolidated interim financial statements as at, and for the nine months ended
31 January 2025, comprise the Company and its subsidiaries ('the Group') and
are presented in US dollars.
The condensed consolidated interim financial statements for the nine months
ended 31 January 2025 were approved by the directors on 3 March 2025.
The condensed consolidated interim financial statements do not constitute
statutory accounts as defined in Section 434 of the Companies Act 2006. The
statutory accounts for the year ended 30 April 2024 were approved by the
directors on 17 June 2024 and have been mailed to shareholders and filed with
the Registrar of Companies. The auditors' report on those accounts was
unqualified, did not include a reference to any matter by way of emphasis and
did not contain a statement under Section 498(2) or (3) of the Companies Act
2006.
Details of principal risks and uncertainties are given in the Review of Third
Quarter, Balance Sheet and Cash Flow accompanying these condensed consolidated
interim financial statements
2. Basis of preparation
The condensed consolidated interim financial statements for the nine months
ended 31 January 2025 have been prepared in accordance with relevant
UK-adopted International Accounting Standards ('IFRS'), including IAS 34,
Interim Financial Reporting, the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority and the
accounting policies set out in the Group's Annual Report & Accounts for
the year ended 30 April 2024.
In preparing the financial statements, the exchange rates used in respect of
the pound sterling (£) and Canadian dollar (C$) are:
Pound sterling Canadian dollar
2025 2024 2025 2024
Average for the three months ended 31 January 1.26 1.26 0.70 0.74
Average for the nine months ended 31 January 1.28 1.26 0.72 0.74
At 30 April - 1.25 - 0.73
At 31 January 1.24 1.27 0.69 0.75
The directors have adopted various alternative performance measures to provide
additional useful information on the underlying trends, performance and
position of the Group. The alternative performance measures are not defined
by IFRS and therefore may not be directly comparable with other companies'
alternative performance measures but are defined within the Glossary of Terms
on page 29.
The condensed consolidated interim financial statements have been prepared on
the going concern basis. The Group's internal budgets and forecasts of
future performance, available financing facilities and facility headroom (see
Note 12), provide a reasonable expectation that the Group has adequate
resources to continue in operation for the foreseeable future and consequently
the going concern basis continues to be appropriate in preparing the financial
statements.
3. Segmental analysis
Three months to 31 January 2025 (unaudited)
Corporate
US Canada UK items Group
$m $m $m $m $m
Revenue
Rental revenue 2,060.4 142.2 178.2 - 2,380.8
Sale of new equipment, merchandise
and consumables 54.4 7.0 17.6 - 79.0
Sale of used rental equipment 87.5 8.9 11.7 - 108.1
2,202.3 158.1 207.5 - 2,567.9
Segment profit 564.2 19.3 8.6 (13.7) 578.4
Amortisation (28.6)
Net financing costs (140.8)
Profit before taxation 409.0
Taxation (99.3)
Profit attributable to equity shareholders 309.7
Three months to 31 January 2024 (unaudited)
Corporate
US Canada UK items Group
$m $m $m $m $m
Revenue
Rental revenue 2,038.3 141.6 176.4 - 2,356.3
Sale of new equipment, merchandise
and consumables 53.1 11.3 17.4 - 81.8
Sale of used rental equipment 188.6 16.9 14.2 - 219.7
2,280.0 169.8 208.0 - 2,657.8
Segment profit 600.1 18.7 10.9 (8.1) 621.6
Amortisation (31.0)
Net financing costs (148.6)
Profit before taxation 442.0
Taxation (109.7)
Profit attributable to equity shareholders 332.3
Nine months to 31 January 2025 (unaudited)
Corporate
US Canada UK items Group
$m $m $m $m $m
Revenue
Rental revenue 6,578.4 478.2 589.5 - 7,646.1
Sale of new equipment, merchandise
and consumables 176.0 25.7 59.0 - 260.7
Sale of used rental equipment 292.1 25.7 37.8 - 355.6
7,046.5 529.6 686.3 - 8,262.4
Segment profit 1,996.0 100.7 55.7 (31.6) 2,120.8
Amortisation (86.5)
Net financing costs (428.3)
Profit before taxation 1,606.0
Taxation (406.8)
Profit attributable to equity shareholders 1,199.2
Nine months to 31 January 2024 (unaudited)
Corporate
US Canada UK items Group
$m $m $m $m $m
Revenue
Rental revenue 6,337.5 425.2 554.0 - 7,316.7
Sale of new equipment, merchandise
and consumables 185.1 37.1 56.4 - 278.6
Sale of used rental equipment 549.5 39.0 47.4 - 635.9
7,072.1 501.3 657.8 - 8,231.2
Segment profit 2,081.2 78.4 51.9 (26.4) 2,185.1
Amortisation (92.3)
Net financing costs (400.3)
Profit before taxation 1,692.5
Taxation (418.8)
Profit attributable to equity shareholders 1,273.7
Corporate
US Canada UK items Group
$m $m $m $m $m
At 31 January 2025 (unaudited)
Segment assets 18,481.3 1,837.1 1,512.1 6.1 21,836.6
Cash 25.8
Taxation assets 70.2
Total assets 21,932.6
At 30 April 2024 (audited)
Segment assets 18,148.4 1,901.0 1,517.1 6.5 21,573.0
Cash 20.8
Taxation assets 57.5
Total assets 21,651.3
4. Operating costs and other income
Unaudited
Three months Nine months
to 31 January to 31 January
2025 2024 2025 2024
$m $m $m $m
Staff costs:
Salaries 537.5 572.0 1,695.6 1,719.2
Social security costs 44.2 44.8 130.0 127.8
Other pension costs 11.7 12.4 35.8 35.5
593.4 629.2 1,861.4 1,882.5
Other operating costs:
Vehicle costs 161.4 154.0 542.8 498.6
Spares, consumables & external repairs 138.2 132.9 431.9 414.8
Facility costs 29.7 28.8 85.6 85.4
Other external charges 388.8 377.8 1,174.3 1,128.0
718.1 693.5 2,234.6 2,126.8
Used rental equipment sold 85.7 166.9 297.8 470.4
Depreciation and amortisation:
Depreciation of tangible assets 538.7 491.9 1,589.8 1,414.7
Depreciation of right-of-use assets 53.6 54.7 158.0 151.7
Amortisation of intangibles 28.6 31.0 86.5 92.3
620.9 577.6 1,834.3 1,658.7
2,018.1 2,067.2 6,228.1 6,138.4
5. Net financing costs
Unaudited
Three months Nine months
to 31 January to 31 January
2025 2024 2025 2024
$m $m $m $m
Interest income:
Net income on the defined benefit pension plan asset - 0.3 - 0.7
Other interest 0.1 0.3 0.1 0.9
0.1 0.6 0.1 1.6
Interest expense:
Bank interest payable 29.8 55.1 98.5 137.1
Interest payable on senior notes 69.8 58.0 209.5 162.5
Interest payable on lease liabilities 37.5 33.2 109.2 94.3
Non-cash unwind of discount on liabilities 1.2 0.6 3.8 1.6
Amortisation of deferred debt raising costs 2.6 2.3 7.4 6.4
140.9 149.2 428.4 401.9
6. Taxation
The tax charge for the period has been determined by applying the expected
effective tax rates in each jurisdiction for the year as a whole, based on the
tax rates in force as at 31 January 2025 of 25% in the US (2024: 25%), 26% in
Canada (2024: 25%) and 25% in the UK (2024: 25%). This results in a blended
effective rate for the Group as a whole of 25% (2024: 25%) for the period.
The tax charge of $407m (2024: $419m) on the profit before taxation of $1,606m
(2024: $1,692m) can be explained as follows:
Nine months to 31 January
2025 2024
$m $m
Current tax
- current tax on income for the period 385.4 251.0
- adjustments to prior year (5.6) 2.8
379.8 253.8
Deferred tax
- origination and reversal of temporary differences 27.0 181.8
- adjustments to prior year - (16.8)
27.0 165.0
Tax charge 406.8 418.8
Comprising:
- US 394.1 416.3
- Canada 11.5 3.5
- UK 1.2 (1.0)
406.8 418.8
Following its state aid investigation, in April 2019 the European Commission
announced its decision that the Group Financing Exemption in the UK controlled
foreign company ('CFC') legislation constitutes state aid in some
circumstances. In common with the UK Government and other UK-based
international companies, the Group did not agree with the decision and lodged
a formal appeal with the General Court of the European Union. The Group's
appeal was stayed while the appeals put forward by the UK Government and ITV
plc proceeded.
On 8 June 2022 the General Court of the European Union dismissed the appeals
put forward by the UK Government and ITV plc. However, they appealed the
decision to the Court of Justice of the European Union. The Court of Justice
of the European Union held a hearing on the case in January 2024 and the
Advocate-General's opinion was published in April 2024, proposing that the
Court of Justice of the European Union set aside the judgement of the General
Court and annul the decision made by the European Commission. On 19 September
2024, the Court of Justice of the European Union followed the recommendation
of the Advocate-General's opinion and annulled the European Commission
decision.
Despite the UK Government appealing the European Commission's decision, His
Majesty's Revenue & Customs ('HMRC') was required to assess the tax
liability which would arise if the decision was not appealed successfully.
Accordingly, HMRC issued a charging notice stating that the tax liability due
was £36m, including interest payable. The Group appealed the charging
notice but had to settle the amount assessed on it, including interest, in
line with HMRC requirements. As a result of the Court of Justice of the
European Union decision to annul the European Commission decision, the Group
has no liability in relation to this matter and the entire amount paid is
recoverable from HMRC.
The £36m ($44m at January 2025 exchange rates) paid has been recognised as a
current asset on the balance sheet. It has been re-classified from non-current
assets based on an expectation that amounts will be repaid by HMRC during the
next 12 months.
7. Earnings per share
Basic and diluted earnings per share for the three and nine months ended 31
January 2025 have been calculated based on the profit for the relevant period
and the weighted average number of ordinary shares in issue during that period
(excluding shares held by the Company and the ESOT over which dividends have
been waived). Diluted earnings per share is computed using the result for
the relevant period and the diluted number of shares (ignoring any potential
issue of ordinary shares which would be anti-dilutive). These are calculated
as follows:
Three months to Nine months to
31 January 31 January
2025 2024 2025 2024
Profit for the financial period ($m) 309.7 332.3 1,199.2 1,273.7
Weighted average number of shares (m) - basic 436.5 436.8 436.7 437.1
- diluted 437.4 439.1 438.0 439.5
Basic earnings per share 70.9¢ 76.1¢ 274.6¢ 291.4¢
Diluted earnings per share 70.9¢ 75.6¢ 273.8¢ 289.8¢
A reconciliation to adjusted earnings per share is included in the Glossary of
Terms on page 29.
8. Dividends
A final dividend in respect of the year ended 30 April 2024 of 89.25¢ (2024:
85.0¢) per share was paid to shareholders during the year resulting in a cash
outflow of $387m (2024: $368m). The interim dividend in respect of the year
ending 30 April 2025 of 36¢ (2024: 15.75¢) per share announced on 10
December was paid on 7 February 2025 to shareholders and cost $157m (2024:
$68m).
9. Property, plant and equipment
2025 2024
Rental Rental
equipment Total equipment Total
Net book value $m $m $m $m
At 1 May 11,450.8 13,248.5 9,649.1 11,041.1
Exchange differences (45.9) (56.0) 21.1 24.7
Reclassifications (8.2) - 0.3 -
Additions 1,761.8 2,141.1 2,989.8 3,508.6
Acquisitions 27.5 29.5 383.6 407.7
Disposals (281.5) (314.4) (472.5) (489.3)
Depreciation (1,360.6) (1,589.8) (1,214.5) (1,414.7)
At 31 January 11,543.9 13,458.9 11,356.9 13,078.1
10. Right-of-use assets
2025 2024
Property Other Property Other
Net book value leases leases Total leases leases Total
$m $m $m $m $m $m
At 1 May 2,390.5 35.1 2,425.6 2,184.8 21.2 2,206.0
Exchange differences (14.2) (0.2) (14.4) 5.6 0.4 6.0
Additions 148.8 4.7 153.5 229.1 16.3 245.4
Acquisitions 18.6 - 18.6 99.2 - 99.2
Remeasurement 59.8 - 59.8 45.2 - 45.2
Disposals (8.8) (1.1) (9.9) (46.6) (0.8) (47.4)
Depreciation (151.9) (6.1) (158.0) (146.9) (4.8) (151.7)
At 31 January 2,442.8 32.4 2,475.2 2,370.4 32.3 2,402.7
11. Lease liabilities
31 January 30 April
2025 2024
$m $m
Current 288.6 273.8
Non-current 2,496.4 2,406.8
2,785.0 2,680.6
12. Borrowings
31 January 30 April
2025 2024
$m $m
Non-current
First priority senior secured bank debt 1,695.6 1,848.0
1.500% senior notes, due August 2026 548.5 547.8
4.375% senior notes, due August 2027 597.4 596.6
4.000% senior notes, due May 2028 596.7 596.0
4.250% senior notes, due November 2029 595.9 595.3
2.450% senior notes, due August 2031 745.1 744.6
5.500% senior notes, due August 2032 739.7 738.8
5.550% senior notes, due May 2033 743.8 743.4
5.950% senior notes, due October 2033 744.4 744.1
5.800% senior notes, due April 2034 841.0 840.5
7,848.1 7,995.1
The senior secured bank debt is secured by way of fixed and floating charges
over substantially all the Group's property, plant and equipment, inventory
and trade receivables and is committed until November 2029. The senior notes
are guaranteed by Ashtead Group plc and all its principal subsidiary
undertakings.
Our debt facilities are committed for the long term, with an average maturity
of six years and a weighted average interest cost (including non-cash
amortisation of deferred debt raising costs) of 5%.
There is one financial performance covenant under the first priority senior
credit facility. That is the fixed charge ratio (comprising EBITDA before
exceptional items less net capital expenditure paid in cash over the sum of
scheduled debt repayments plus cash interest, cash tax payments and dividends
paid in the last twelve months) which, must be equal to, or greater than, 1.0.
This covenant does not apply when availability exceeds $475m. At 31 January
2025, availability under the senior secured bank facility was $3,174m ($2,771m
at 30 April 2024), with an additional $6,434m of suppressed availability,
meaning that the covenant did not apply at 31 January 2025 and is unlikely to
apply in forthcoming quarters.
Fair value of financial instruments
Financial assets and liabilities are measured in accordance with the fair
value hierarchy and assessed as Level 1, 2 or 3 based on the following
criteria:
- Level 1: fair value measurement based on quoted prices (unadjusted)
in active markets for identical assets or liabilities;
- Level 2: fair value measurements derived from inputs other than
quoted prices that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices); and
- Level 3: fair value measurements derived from valuation techniques
that include inputs for the asset or liability that are not based on
observable market data.
Fair value of derivative financial instruments
At 31 January 2025, the Group had no derivative financial instruments. The
embedded prepayment options included within the senior notes are either
closely related to the host debt contract or immaterial and hence, are not
accounted for separately. These loan notes are carried at amortised cost.
Fair value of non-derivative financial assets and liabilities
The table below provides a comparison, by category of the carrying amounts and
the fair values of the Group's non-derivative financial assets and
liabilities.
At 31 January 2025 At 30 April 2024
Book value Fair value Book value Fair value
$m $m $m $m
Long-term borrowings
- first priority senior secured bank debt Level 1 1,695.6 1,695.6 1,848.0 1,848.0
- 1.500% senior notes Level 1 550.0 521.6 550.0 498.1
- 4.375% senior notes Level 1 600.0 589.7 600.0 571.5
- 4.000% senior notes Level 1 600.0 579.5 600.0 559.9
- 4.250% senior notes Level 1 600.0 570.7 600.0 549.9
- 2.450% senior notes Level 1 750.0 629.2 750.0 596.5
- 5.500% senior notes Level 1 750.0 743.7 750.0 719.9
- 5.550% senior notes Level 1 750.0 741.0 750.0 719.2
- 5.950% senior notes Level 1 750.0 761.1 750.0 739.7
- 5.800% senior notes Level 1 850.0 852.7 850.0 828.3
Total long-term borrowings 7,895.6 7,684.8 8,048.0 7,631.0
Discount on issue of debt (12.8) - (14.0) -
Deferred costs of raising finance (34.7) - (38.9) -
7,848.1 7,684.8 7,995.1 7,631.0
Other financial instruments(1)
Contingent consideration Level 3 19.3 19.3 31.4 31.4
Financial asset investments Level 3 31.5 31.5 57.0 57.0
Cash and cash equivalents Level 1 25.8 25.8 20.8 20.8
( )
(1) The Group's trade and other receivables and trade and other payables,
excluding contingent consideration, are not shown in the table above. The
carrying amounts of these financial assets and liabilities approximate their
fair values.
Contingent consideration is a Level 3 financial liability. Future
anticipated payments to vendors in respect of contingent consideration are
initially recorded at fair value which is the present value of the expected
cash outflows of the obligations. The obligations are dependent upon the
future financial performance of the businesses acquired. The fair value is
estimated based on internal financial projections prepared in relation to the
acquisition with the contingent consideration discounted to present value
using a discount rate in line with the Group's cost of debt. The movement
since 30 April 2024 can be attributed to $12m of payments (see Note 14) and
$5m released, offset by $1m of discount unwind and $4m of additions through
business acquisitions (see Note 15).
Financial asset investments are measured at fair value and are Level 3
financial assets. These assets are measured at fair value through other
comprehensive income. Their fair values are estimated based on the latest
transaction price and any subsequent investment-specific adjustments. During
the period, one of the Group's investments failed to secure additional funding
and commenced Chapter 7 bankruptcy proceedings in August 2024. As a result,
the Group has estimated the fair value of its investment as $nil and
consequently recognised a movement in the fair value of the equity investment
of $25m through other comprehensive income.
13. Share capital
Ordinary shares of 10p each:
31 January 30 April 31 January 30 April
2025 2024 2025 2024
Number Number $m $m
Issued and fully paid 451,354,833 451,354,833 81.8 81.8
During the period, the Company purchased 1.5m ordinary shares at a total cost
of $93m (£75m) under the Group's share buyback programme announced by the
Company in December 2024, which are held in treasury. At 31 January 2025,
15.5m (April 2024: 14.1m) shares were held by the Company ($912m; April
2024: $819m) and a further 0.5m (April 2024: 0.9m) shares were held by the
Company's Employee Share Ownership Trust ($35m; April 2024: $43m).
14. Notes to the cash flow statement
a) Cash flow from operating activities
Nine months to 31 January
2025 2024
$m $m
Operating profit 2,034.3 2,092.8
Depreciation 1,747.8 1,566.4
Amortisation 86.5 92.3
EBITDA 3,868.6 3,751.5
Profit on disposal of rental equipment (57.8) (165.5)
Profit on disposal of other property, plant and equipment (13.2) (14.5)
Decrease/(increase) in inventories 4.9 (6.3)
Increase in trade and other receivables (93.6) (227.7)
Decrease in trade and other payables (5.8) (53.1)
Exchange differences (0.5) (0.4)
Other non-cash movement 21.0 37.5
Cash generated from operations before
changes in rental equipment 3,723.6 3,321.5
b) Analysis of net debt
Net debt consists of total borrowings and lease liabilities less cash and cash
equivalents. Borrowings exclude accrued interest. Non-US dollar
denominated balances are translated to US dollars at rates of exchange ruling
at the balance sheet date.
Non-cash movements
1 May Cash Exchange Debt New lease Other 31 January
2024 flow movement acquired liabilities movements 2025
$m $m $m $m $m $m $m
Long-term borrowings 7,995.1 (122.3) (32.2) 0.1 - 7.4 7,848.1
Lease liabilities 2,680.6 (100.1) (16.1) 18.6 202.0 - 2,785.0
Total liabilities from
financing activities 10,675.7 (222.4) (48.3) 18.7 202.0 7.4 10,633.1
Cash and cash
equivalents (20.8) (5.6) 0.6 - - - (25.8)
Net debt 10,654.9 (228.0) (47.7) 18.7 202.0 7.4 10,607.3
Non-cash movements
1 May Cash Exchange Debt New lease Other 31 January
2023 flow movement acquired liabilities movements 2024
$m $m $m $m $m $m $m
Long-term borrowings 6,595.1 1,876.9 14.6 55.3 - 3.9 8,545.8
Lease liabilities 2,394.3 (96.3) 6.6 99.2 238.5 - 2,642.3
Total liabilities from
financing activities 8,989.4 1,780.6 21.2 154.5 238.5 3.9 11,188.1
Cash and cash
equivalents (29.9) 7.7 (0.2) - - - (22.4)
Net debt 8,959.5 1,788.3 21.0 154.5 238.5 3.9 11,165.7
Details of the Group's cash and debt are given in Notes 11 and 12 and the
Review of Third Quarter, Balance Sheet and Cash Flow accompanying these
condensed consolidated interim financial statements.
c) Acquisitions
Nine months to 31 January
2025 2024
$m $m
Cash consideration paid:
- acquisitions in the period 56.4 842.1
- contingent consideration 11.6 20.8
68.0 862.9
During the period, three businesses were acquired with cash paid of $56m
(2024: $842m), after taking account of net cash acquired of $2m (2024: $6m).
Further details are provided in Note 15.
Contingent consideration of $12m (2024: $21m) was paid relating to prior year
acquisitions.
15. Acquisitions
The Group undertakes bolt-on acquisitions to complement its organic growth
strategy. During the period, the following acquisitions were completed:
i) On 21 May 2024, Sunbelt US acquired the business and assets
of RentalMax, LLC ('RentalMax'). RentalMax is a general tool business
operating in Illinois.
ii) On 25 June 2024, Sunbelt Canada acquired the business and
assets of Wave Equipment Ltd. ('Wave'). Wave is a general tool business
operating in Ontario.
iii) On 3 December 2024, Sunbelt UK acquired the entire share
capital of JLLive Ltd, JLLighting Limited and DigiSet Limited (together 'JL').
JL is a specialty business.
The following table sets out the fair value of the identifiable assets and
liabilities acquired by the Group. The fair values have been determined
provisionally at the balance sheet date.
Fair value
to the Group
$m
Net assets acquired
Trade and other receivables 3.1
Property, plant and equipment
- rental equipment 27.5
- other assets 2.0
Right-of-use assets 18.6
Deferred tax (0.3)
Creditors (2.4)
Debt (0.1)
Lease liabilities (18.6)
Intangible assets 0.1
29.9
Consideration:
- cash paid and due to be paid (net of cash acquired) 56.0
- contingent consideration 4.1
60.1
Goodwill 30.2
The goodwill arising can be attributed to the key management personnel and
workforce of the acquired businesses, the benefits through advancing our
clusters and leveraging cross-selling opportunities, and to the synergies and
other benefits the Group expects to derive from the acquisitions. The
synergies and other benefits include elimination of duplicate costs, improving
utilisation of the acquired rental fleet, using the Group's financial strength
to invest in the acquired business and drive improved returns through a
semi-fixed cost base and the application of the Group's proprietary software
to optimise revenue opportunities. $24m of the goodwill is expected to be
deductible for income tax purposes.
The gross value and the fair value of trade receivables at acquisition was
$3m.
Due to the operational integration of acquired businesses post-acquisition, in
particular due to the merger of some stores, the movement of rental equipment
between stores and investment in the rental fleet, it is not practical to
report the revenue and profit of the acquired businesses post-acquisition.
The revenue and operating profit of these acquisitions from 1 May 2024 to
their date of acquisition was not material.
REVIEW OF THIRD QUARTER, BALANCE SHEET AND CASH FLOW
Third quarter
Revenue Adjusted EBITDA Profit(1)
2025 2024 2025 2024 2025 2024
Canada in C$m 225.4 229.4 91.6 81.4 28.1 25.3
UK in £m 165.3 165.0 44.0 44.1 7.1 8.6
US 2,202.3 2,280.0 1,065.1 1,060.3 564.2 600.1
Canada in $m 158.1 169.8 63.9 60.3 19.3 18.7
UK in $m 207.5 208.0 55.1 55.6 8.6 10.9
Group central costs - - (7.6) (8.0) (7.9) (8.1)
2,567.9 2,657.8 1,176.5 1,168.2 584.2 621.6
Financing costs (140.8) (148.6)
Adjusted profit before tax 443.4 473.0
Non-recurring costs (5.8) -
Amortisation (28.6) (31.0)
Profit before taxation 409.0 442.0
Margins as reported
US 48.4% 46.5% 25.6% 26.3%
Canada 40.7% 35.5% 12.5% 11.0%
UK 26.6% 26.7% 4.3% 5.2%
Group 45.8% 44.0% 22.8% 23.4%
(1) Adjusted operating profit.
Group revenue for the quarter decreased 3% to $2,568m (2024: $2,658m)
reflecting lower sales of used equipment. Adjusted profit before tax for the
quarter decreased to $443m (2024: $473m).
US rental only revenue in the quarter was 1% higher than a year ago. This
consisted of our General Tool business which was 2% lower than last year while
our Specialty businesses were 10% higher than a year ago.
Canada's rental only revenue increased 6% to C$156m (2024: C$147m), while
total revenue was C$225m (2024: C$229m). Following settlement of the
Writers Guild of America and Screen Actors Guild strikes, activity in the
Specialty Film & TV business has recovered, although it is below
pre-strike levels, which is likely to be the new normal.
The UK generated rental only revenue in the quarter of £109m (2024: £111m),
2% lower than the prior year. Total revenue was £165m (2024: £165m).
Group adjusted operating profit decreased 6% to $584m (2024: $622m). After
financing costs of $141m (2024: $149m), Group adjusted profit before tax was
$443m (2024: $473m). After non-recurring costs of $6m (2024: Nil) and
amortisation of $29m (2024: $31m), statutory profit before taxation was $409m
(2024: $442m).
Balance sheet
Property, plant and equipment
Capital expenditure in the nine months totalled $2,141m (2024: $3,509m) with
$1,762m invested in the rental fleet (2024: $2,990m). Expenditure on rental
equipment was 82% of total capital expenditure with the balance relating to
the delivery vehicle fleet, property improvements and IT equipment. Capital
expenditure by division was:
2025 2024
Replacement Growth Total Total
Canada in C$m 90.5 125.4 215.9 245.2
UK in £m 75.6 20.9 96.5 142.2
US 812.2 670.2 1,482.4 2,629.2
Canada in $m 65.3 90.6 155.9 182.0
UK in $m 96.8 26.7 123.5 178.6
Total rental equipment 974.3 787.5 1,761.8 2,989.8
Delivery vehicles, property improvements & IT equipment 379.3 518.8
Total additions 2,141.1 3,508.6
In the US, $670m of rental equipment capital expenditure was spent on growth
while $812m was invested in replacement of existing fleet. The growth
proportion is estimated based on the assumption that replacement capital
expenditure in any period is equal to the original cost of equipment sold.
In a period of inflation, this understates replacement capital expenditure
and overstates growth capital expenditure. Life cycle inflation is c. 20%.
The average age of the Group's serialised rental equipment, which constitutes
the substantial majority of our fleet, at 31 January 2025 was 47 months (2024:
46 months) on an original cost basis. The US fleet had an average age of 47
months (2024: 45 months), the Canadian fleet had an average age of 52 months
(2024: 52 months) and the UK fleet had an average age of 52 months (2024: 50
months).
Rental fleet at original cost LTM rental LTM dollar
revenue utilisation
31 January 2025 30 April 2024 LTM average
Canada in C$m 1,883 1,751 1,806 855 47%
UK in £m 1,151 1,130 1,145 610 53%
US 15,747 15,057 15,369 8,562 56%
Canada in $m 1,300 1,274 1,310 620 47%
UK in $m 1,431 1,414 1,460 778 53%
18,478 17,745 18,139 9,960
Dollar utilisation was 56% in the US (2024: 58%), 47% for Canada (2024: 48%)
and 53% for the UK (2024: 52%). The decrease in US and Canadian dollar
utilisation is due to principally lower physical utilisation and fleet
inflation.
Trade receivables
Receivable days at 31 January 2025 were 52 days (2024: 53 days). The bad
debt charge for the last twelve months ended 31 January 2025 as a percentage
of total turnover was 0.8% (2024: 0.5%). Trade receivables at 31 January
2025 of $1,601m (2024: $1,671m) are stated net of allowances for bad debts and
credit notes of $149m (2024: $119m), with the provision representing 9%
(2024: 7%) of gross receivables.
Trade and other payables
Group payable days were 49 days at 31 January 2025 (2024: 46 days) with
capital expenditure related payables totalling $226m (2024: $399m). Payment
periods for purchases other than rental equipment vary between seven and 60
days and for rental equipment between 30 and 120 days.
Cash flow and net debt
Nine months to LTM to Year to
31 January 31 January 30 April
2025 2024 2025 2024
$m $m $m $m
Adjusted EBITDA 3,874.4 3,751.5 5,015.5 4,892.6
Cash inflow from operations before non-recurring
costs and changes in rental equipment 3,725.0 3,321.5 4,944.5 4,541.0
Cash conversion ratio* 96.1% 88.5% 98.6% 92.8%
Replacement rental capital expenditure (1,244.6) (1,692.1) (1,673.5) (2,121.0)
Payments for non-rental capital expenditure (379.4) (520.2) (544.8) (685.6)
Rental equipment disposal proceeds 303.7 522.9 612.5 831.7
Other property, plant and equipment disposal proceeds 44.9 47.3 45.1 47.5
Tax paid (378.6) (233.2) (391.2) (245.8)
Financing costs (403.4) (369.0) (547.5) (513.1)
Cash inflow before growth capex and
non-recurring costs 1,667.6 1,077.2 2,445.1 1,854.7
Growth rental capital expenditure (809.5) (1,539.7) (908.0) (1,638.2)
Free cash flow 858.1 (462.5) 1,537.1 216.5
Non-recurring costs (1.4) - (1.4) -
Business acquisitions (68.0) (862.9) (80.7) (875.6)
Business disposals - - 1.9 1.9
Financial asset investments - (5.0) (10.0) (15.0)
Total cash generated/(absorbed) 788.7 (1,330.4) 1,446.9 (672.2)
Dividends (387.4) (367.7) (455.8) (436.1)
Purchase of own shares by the ESOT (85.2) (29.9) (85.2) (29.9)
Purchase of own shares by the Company (88.1) (60.3) (106.2) (78.4)
Decrease/(increase) in net debt due to cash flow 228.0 (1,788.3) 799.7 (1,216.6)
* Cash inflow from operations before non-recurring costs and changes in rental
equipment as a percentage of adjusted EBITDA.
Cash inflow from operations before non-recurring costs and the net investment
in the rental fleet was $3,725m (2024: $3,321m). The conversion ratio for
the period was 96% (2024: 89%).
Total payments for capital expenditure (rental equipment and other PPE) in the
nine months were $2,434m (2024: $3,752m). Disposal proceeds received
totalled $349m (2024: $570m), giving net payments for capital expenditure of
$2,085m in the period (2024: $3,182m). Financing costs paid totalled $403m
(2024: $369m) while tax payments were $379m (2024: $233m). Financing costs
paid typically differ from the charge in the income statement due to the
timing of interest payments in the period and non-cash interest charges.
Accordingly, the period saw free cash flow of $858m (2024: outflow of $463m)
and, after non-recurring costs of $1m (2024: $nil), acquisition and investment
related expenditure of $68m (2024: $868m), a cash flow of $789m
(2024: outflow of $1,330m), before returns to shareholders.
Net debt
31 January 30 April
2025 2024 2024
$m $m $m
First priority senior secured bank debt 1,695.6 2,400.4 1,848.0
1.500% senior notes, due 2026 548.5 547.5 547.8
4.375% senior notes, due 2027 597.4 596.4 596.6
4.000% senior notes, due 2028 596.7 595.8 596.0
4.250% senior notes, due 2029 595.9 595.1 595.3
2.450% senior notes, due 2031 745.1 744.4 744.6
5.500% senior notes, due 2032 739.7 738.6 738.8
5.550% senior notes, due 2033 743.8 743.3 743.4
5.950% senior notes, due 2033 744.4 744.0 744.1
5.800% senior notes, due 2034 841.0 840.3 840.5
Total external borrowings 7,848.1 8,545.8 7,995.1
Lease liabilities 2,785.0 2,642.3 2,680.6
Total gross debt 10,633.1 11,188.1 10,675.7
Cash and cash equivalents (25.8) (22.4) (20.8)
Total net debt 10,607.3 11,165.7 10,654.9
Net debt at 31 January 2025 was $10,607m with the decrease since 30 April 2024
reflecting the cash inflow set out above, partially offset by additional lease
commitments as we continue our greenfield and bolt-on expansion. The Group's
adjusted EBITDA for the twelve months ended 31 January 2025 was $5,015m.
Excluding the impact of IFRS 16, the ratio of net debt to adjusted EBITDA was
1.7 times (2024: 1.9 times) on a constant currency and a reported basis as at
31 January 2025. Including the impact of IFRS 16, the ratio of net debt to
adjusted EBITDA was 2.1 times (2024: 2.3 times) as at 31 January 2025.
Principal risks and uncertainties
Risks and uncertainties in achieving the Group's objectives for the remainder
of the financial year, together with assumptions, estimates, judgements and
critical accounting policies used in preparing financial information remain
broadly unchanged from those detailed in the 2024 Annual Report and Accounts
on pages 36 to 41.
The principal risks and uncertainties facing the Group are:
· economic conditions - in the longer term, there is a link between
levels of economic activity and demand for our services. The most
significant end market which affects our business is construction. The
construction industry is cyclical and typically lags the general economic
cycle by between 12 and 24 months.
The economic uncertainties resulting from the impact of pandemics is
considered as part of this risk.
· competition - the already competitive market could become even more
competitive and we could suffer increased competition from large national
competitors or smaller regional or local companies resulting in reduced market
share and lower revenue.
This could negatively affect rental rates and physical utilisation.
Continuing industry consolidation could also have a similar effect.
· cyber security - a cyber-attack or serious uncured failure in our
systems could result in us being unable to deliver service to our customers
and / or the loss of data. In particular, we are heavily dependent on
technology for the smooth running of our business given the large number of
both units of equipment we rent and our customers. As a result, we could
suffer reputational loss, revenue loss and financial penalties.
This is the most significant factor in our business continuity planning.
· health and safety - a failure to comply with laws and regulations
governing health and safety and ensure the highest standards of health and
safety across the Group could result in accidents which may result in injury
to or fatality of an individual, claims against the Group and/or damage to our
reputation.
· people and culture - retaining and attracting good people is key to
delivering superior performance and customer service and maintaining and
enhancing our culture.
Excessive staff turnover is likely to impact on our ability to maintain the
appropriate quality of service to our customers and would ultimately impact
our financial performance adversely.
At a leadership level, succession planning is required to ensure the Group can
continue to inspire the right culture, leadership and behaviours and meet its
strategic objectives. Furthermore, it is important that our remuneration
policies reflect the Group's North American focus and enable us to retain and
enhance our strong leadership team.
· environmental - as part of Sunbelt 4.0, the Group has made a
long-term commitment to reduce its Scope 1 and 2 carbon intensity by 50% by
2034, compared to a baseline of 2024, on a journey to Net Zero by 2050.
Failure to achieve these goals could adversely impact the Group and its
stakeholders.
In terms of the Group's assessment of the broader environmental impacts of our
activities, we also consider the upstream and downstream impacts of our
operations and note that a significant part of our Scope 3 emissions arises
from our rental fleet, which today is reliant on diesel engines. Over time,
'greener' alternatives will become available as technology advances. If we
do not remain at the forefront of technological advances, and invest in the
latest equipment, our rental fleet could become obsolete.
In addition, we need to comply with the numerous laws governing environmental
protection matters. These laws regulate such issues as wastewater, storm
water, solid and hazardous wastes and materials, and air quality. Breaches
potentially create hazards to our employees, damage to our reputation and
expose the Group to, amongst other things, the cost of investigating and
remediating contamination and also fines and penalties for non-compliance.
· laws and regulations - breaches of laws or regulations governing
the Group's activities could result in criminal prosecution, substantial
claims and loss of reputation.
Further details, including actions taken to mitigate these risks, are provided
within the 2024 Annual Report & Accounts.
Our business is subject to significant fluctuations in performance from
quarter to quarter as a result of seasonal effects. Commercial construction
activity tends to increase in the summer and during extended periods of mild
weather and to decrease in the winter and during extended periods of inclement
weather. Furthermore, due to the incidence of public holidays in the US,
Canada and the UK, there are more billing days in the first half of our
financial year than the second half leading to our revenue normally being
higher in the first half. On a quarterly basis, the second quarter is
typically our strongest quarter, followed by the first and then the third and
fourth quarters.
In addition, the current trading and outlook section of the interim statement
provides commentary on market and economic conditions for the remainder of the
year.
OPERATING STATISTICS
Number of rental stores Staff numbers
31 January 30 April 31 January 30 April
2025 2024 2024 2025 2024 2024
US 1,224 1,181 1,186 18,518 20,250 19,245
Canada 140 136 135 2,210 2,408 2,306
UK 191 191 190 4,407 4,337 4,384
Corporate office - - - 29 23 23
Group 1,555 1,508 1,511 25,164 27,018 25,958
GLOSSARY OF TERMS
The glossary of terms below sets out definitions of terms used throughout this
announcement. Included are a number of alternative performance measures
('APMs') which the directors have adopted in order to provide additional
useful information on the underlying trends, performance and position of the
Group. The directors use these measures, which are common across the
industry, for planning and reporting purposes. These measures are also used
in discussions with the investment analyst community and credit rating
agencies. The APMs are not defined by IFRS and therefore may not be directly
comparable with other companies' APMs and should not be considered superior to
or a substitute for IFRS measures.
Term Closest equivalent statutory measure Definition and purpose
Adjusted EBITDA Operating profit Adjusted EBITDA is operating profit before depreciation, amortisation and
non-recurring costs associated with the move of the Group's primary listing to
the US.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Operating profit 549.8 590.6 2,034.3 2,092.8
Depreciation 592.3 546.6 1,747.8 1,566.4
Amortisation 28.6 31.0 86.5 92.3
EBITDA 1,170.7 1,168.2 3,868.6 3,751.5
Non-recurring costs associated with relisting:
- Staff costs 1.8 - 1.8 -
- Other operating costs 4.0 - 4.0 -
Adjusted EBITDA 1,176.5 1,168.2 3,874.4 3,751.5
Adjusted operating profit Operating profit Adjusted operating profit is operating profit before amortisation and
non-recurring costs associated with the move of the Group's primary listing to
the US.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Operating profit 549.8 590.6 2,034.3 2,092.8
Amortisation 28.6 31.0 86.5 92.3
Non-recurring costs associated with relisting:
- Staff costs 1.8 - 1.8 -
- Other operating costs 4.0 - 4.0 -
Adjusted operating profit 584.2 621.6 2,126.6 2,185.1
Adjusted profit before tax Profit before tax Adjusted profit before tax is profit before tax, amortisation and
non-recurring costs associated with the move of the Group's primary listing to
the US.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Profit before tax 409.0 442.0 1,606.0 1,692.5
Amortisation 28.6 31.0 86.5 92.3
Non-recurring costs associated with relisting:
- Staff costs 1.8 - 1.8 -
- Other operating costs 4.0 - 4.0 -
Adjusted profit before tax 443.4 473.0 1,698.3 1,784.8
Adjusted profit after tax Profit after tax Adjusted profit after tax is profit after tax before amortisation and
non-recurring costs associated with the move of the Group's primary listing to
the US.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Profit after tax 309.7 332.3 1,199.2 1,273.7
Amortisation 28.6 31.0 86.5 92.3
Non-recurring costs associated with relisting:
- Staff costs 1.8 - 1.8 -
- Other operating costs 4.0 - 4.0 -
Tax on adjusting items (7.3) (7.7) (21.7) (23.1)
Adjusted profit after tax 336.8 355.6 1,269.8 1,342.9
Adjusted earnings per share Earnings per share Adjusted earnings per share is earnings per share before amortisation of
acquired intangibles and non-recurring costs associated with the move to a US
primary listing.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Earnings per share (basic) 70.9ȼ 76.1ȼ 274.6ȼ 291.4ȼ
Amortisation 6.6ȼ 7.1ȼ 19.8ȼ 21.1ȼ
Non-recurring costs associated with relisting:
- Staff costs 0.4¢ - 0.4¢ -
- Other operating costs 0.9¢ - 0.9¢ -
Tax on adjusting items (1.6ȼ) (1.8ȼ) (4.9ȼ) (5.3ȼ)
Adjusted earnings per share (basic) 77.2¢ 81.4ȼ 290.8¢ 307.2ȼ
Drop through None Calculated as the change in rental revenue which converts into adjusted EBITDA
(excluding gains from sale of new equipment, merchandise and consumables and
used equipment).
2025 2024 Change
$m $m
US
Rental revenue 6,578 6,337 241
Adjusted EBITDA 3,467 3,392
Gains (116) (213)
Adjusted EBITDA excluding gains 3,351 3,179 172
Drop through 71%
This measure is utilised by the Group to demonstrate the change in
profitability generated by the Group as a result of the change in rental
revenue in the period.
Free cash flow Net cash generated from operating activities Free cash flow is net cash generated from operating activities adjusted for
non-recurring costs less non-rental net property, plant and equipment
expenditure. Non-rental net property, plant and equipment expenditure
comprises payments for non-rental capital expenditure less disposal proceeds
received in relation to non-rental asset disposals.
2025 2024
$m $m
Net cash generated from operating activities 1,191 10
Non-recurring costs 1 -
Payments for non-rental property, plant and equipment
(379) (520)
Proceeds from disposal of non-rental property,
plant and equipment 45 47
Free cash flow 858 (463)
This measure shows the cash retained by the Group prior to non-recurring
costs, discretionary expenditure on acquisitions and returns to
shareholders.
Growth at constant exchange rates None Calculated by applying the current period exchange rate to the comparative
period result. The relevant foreign currency exchange rates are provided
within Note 2, Basis of preparation, to the financial statements. This
measure is used as a means of eliminating the effects of foreign exchange rate
movements on the period-on-period changes in reported results.
2025 2024 %
$m $m
Rental revenue
As reported 7,646 7,317 5%
Retranslation effect - (1)
At constant currency 7,646 7,316 5%
Adjusted profit before tax
As reported 1,698 1,785 -5%
Retranslation effect - (1)
At constant currency 1,698 1,784 -5%
Leverage None Leverage calculated at constant exchange rates uses the period end exchange
rate for the relevant period and is determined as net debt divided by last
12-month ('LTM') adjusted EBITDA.
2025 2024
Excluding IFRS 16 Including IFRS 16 Excluding IFRS 16 Including IFRS 16
Net debt ($m)
As reported and 7,860 10,607 8,563 11,166
at constant currency
Adjusted EBITDA ($m)
As reported 4,744 5,015 4,578 4,825
Retranslation effect (19) (20) 6 7
At constant currency 4,725 4,995 4,584 4,832
Leverage
As reported 1.7 2.1 1.9 2.3
At constant currency 1.7 2.1 1.9 2.3
This measure is used to provide an indication of the strength of the Group's
balance sheet and is widely used by investors and credit rating agencies. It
also forms part of the remuneration targets of the Group and has been
identified as one of the Group's key performance indicators.
Return on Investment ('RoI') None LTM adjusted operating profit divided by the LTM average of the sum of net
tangible and intangible fixed assets, plus net working capital but excluding
net debt and tax.
RoI is calculated excluding the impact of IFRS 16.
RoI is used by management to help inform capital allocation decisions within
the business and has been identified as one of the Group's key performance
indicators. It also forms part of the remuneration targets of the Group.
A reconciliation of Group RoI is provided below:
2025 2024
$m $m
Adjusted operating profit 2,716 2,790
IFRS 16 impact (69) (56)
Adjusted operating profit (excluding IFRS 16) 2,647 2,734
Average net assets 17,955 15,924
Return on investment 15% 17%
RoI for the businesses is calculated in the same way, but excludes goodwill
and intangible assets:
US Canada C$m UK
$m £m
Adjusted operating profit 2,548 171 60
IFRS 16 impact (59) (13) (1)
Adjusted operating profit (excluding IFRS 16) 2,489 158 59
Average net assets, excluding goodwill and intangibles 12,302 1,363 824
Return on investment 20% 12% 7%
Adjusted operating profit
Operating profit
Adjusted operating profit is operating profit before amortisation and
non-recurring costs associated with the move of the Group's primary listing to
the US.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Operating profit 549.8 590.6 2,034.3 2,092.8
Amortisation 28.6 31.0 86.5 92.3
Non-recurring costs associated with relisting:
- Staff costs 1.8 - 1.8 -
- Other operating costs 4.0 - 4.0 -
Adjusted operating profit 584.2 621.6 2,126.6 2,185.1
Adjusted profit before tax
Profit before tax
Adjusted profit before tax is profit before tax, amortisation and
non-recurring costs associated with the move of the Group's primary listing to
the US.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Profit before tax 409.0 442.0 1,606.0 1,692.5
Amortisation 28.6 31.0 86.5 92.3
Non-recurring costs associated with relisting:
- Staff costs 1.8 - 1.8 -
- Other operating costs 4.0 - 4.0 -
Adjusted profit before tax 443.4 473.0 1,698.3 1,784.8
Adjusted profit after tax
Profit after tax
Adjusted profit after tax is profit after tax before amortisation and
non-recurring costs associated with the move of the Group's primary listing to
the US.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Profit after tax 309.7 332.3 1,199.2 1,273.7
Amortisation 28.6 31.0 86.5 92.3
Non-recurring costs associated with relisting:
- Staff costs 1.8 - 1.8 -
- Other operating costs 4.0 - 4.0 -
Tax on adjusting items (7.3) (7.7) (21.7) (23.1)
Adjusted profit after tax 336.8 355.6 1,269.8 1,342.9
Adjusted earnings per share
Earnings per share
Adjusted earnings per share is earnings per share before amortisation of
acquired intangibles and non-recurring costs associated with the move to a US
primary listing.
Third quarter Nine months
2025 2024 2025 2024
$m $m $m $m
Earnings per share (basic) 70.9ȼ 76.1ȼ 274.6ȼ 291.4ȼ
Amortisation 6.6ȼ 7.1ȼ 19.8ȼ 21.1ȼ
Non-recurring costs associated with relisting:
- Staff costs 0.4¢ - 0.4¢ -
- Other operating costs 0.9¢ - 0.9¢ -
Tax on adjusting items (1.6ȼ) (1.8ȼ) (4.9ȼ) (5.3ȼ)
Adjusted earnings per share (basic) 77.2¢ 81.4ȼ 290.8¢ 307.2ȼ
Drop through
None
Calculated as the change in rental revenue which converts into adjusted EBITDA
(excluding gains from sale of new equipment, merchandise and consumables and
used equipment).
2025 2024 Change
$m $m
US
Rental revenue 6,578 6,337 241
Adjusted EBITDA 3,467 3,392
Gains (116) (213)
Adjusted EBITDA excluding gains 3,351 3,179 172
Drop through 71%
This measure is utilised by the Group to demonstrate the change in
profitability generated by the Group as a result of the change in rental
revenue in the period.
Free cash flow
Net cash generated from operating activities
Free cash flow is net cash generated from operating activities adjusted for
non-recurring costs less non-rental net property, plant and equipment
expenditure. Non-rental net property, plant and equipment expenditure
comprises payments for non-rental capital expenditure less disposal proceeds
received in relation to non-rental asset disposals.
2025 2024
$m $m
Net cash generated from operating activities 1,191 10
Non-recurring costs 1 -
Payments for non-rental property, plant and equipment
(379) (520)
Proceeds from disposal of non-rental property,
plant and equipment 45 47
Free cash flow 858 (463)
This measure shows the cash retained by the Group prior to non-recurring
costs, discretionary expenditure on acquisitions and returns to
shareholders.
Growth at constant exchange rates
None
Calculated by applying the current period exchange rate to the comparative
period result. The relevant foreign currency exchange rates are provided
within Note 2, Basis of preparation, to the financial statements. This
measure is used as a means of eliminating the effects of foreign exchange rate
movements on the period-on-period changes in reported results.
2025 2024 %
$m $m
Rental revenue
As reported 7,646 7,317 5%
Retranslation effect - (1)
At constant currency 7,646 7,316 5%
Adjusted profit before tax
As reported 1,698 1,785 -5%
Retranslation effect - (1)
At constant currency 1,698 1,784 -5%
Leverage
None
Leverage calculated at constant exchange rates uses the period end exchange
rate for the relevant period and is determined as net debt divided by last
12-month ('LTM') adjusted EBITDA.
2025 2024
Excluding IFRS 16 Including IFRS 16 Excluding IFRS 16 Including IFRS 16
Net debt ($m)
As reported and 7,860 10,607 8,563 11,166
at constant currency
Adjusted EBITDA ($m)
As reported 4,744 5,015 4,578 4,825
Retranslation effect (19) (20) 6 7
At constant currency 4,725 4,995 4,584 4,832
Leverage
As reported 1.7 2.1 1.9 2.3
At constant currency 1.7 2.1 1.9 2.3
This measure is used to provide an indication of the strength of the Group's
balance sheet and is widely used by investors and credit rating agencies. It
also forms part of the remuneration targets of the Group and has been
identified as one of the Group's key performance indicators.
Return on Investment ('RoI')
None
LTM adjusted operating profit divided by the LTM average of the sum of net
tangible and intangible fixed assets, plus net working capital but excluding
net debt and tax.
RoI is calculated excluding the impact of IFRS 16.
RoI is used by management to help inform capital allocation decisions within
the business and has been identified as one of the Group's key performance
indicators. It also forms part of the remuneration targets of the Group.
A reconciliation of Group RoI is provided below:
2025 2024
$m $m
Adjusted operating profit 2,716 2,790
IFRS 16 impact (69) (56)
Adjusted operating profit (excluding IFRS 16) 2,647 2,734
Average net assets 17,955 15,924
Return on investment 15% 17%
RoI for the businesses is calculated in the same way, but excludes goodwill
and intangible assets:
US Canada C$m UK
$m £m
Adjusted operating profit 2,548 171 60
IFRS 16 impact (59) (13) (1)
Adjusted operating profit (excluding IFRS 16) 2,489 158 59
Average net assets, excluding goodwill and intangibles 12,302 1,363 824
Return on investment 20% 12% 7%
Other terms used within this announcement include:
· Adjusted: adjusted results are results stated before
non-recurring costs associated with the move of the Group's primary listing to
the US and the amortisation of acquired intangibles. A reconciliation is
shown above.
· Availability: represents the headroom on a given date under the
terms of our $4.75bn asset-backed senior bank facility, taking account of
current borrowings.
· Capital expenditure: represents additions to rental equipment and
other property, plant and equipment (excluding assets acquired through a
business combination).
· Cash conversion ratio: represents cash flow from operations
before changes in rental equipment as a percentage of EBITDA. Details are
provided within the Review of Third Quarter, Balance Sheet and Cash Flow
section.
· Dollar utilisation: dollar utilisation is trailing 12-month
rental revenue divided by average fleet size at original (or 'first') cost
measured over a 12-month period. Dollar utilisation has been identified as
one of the Group's key performance indicators. Details are shown within the
Review of Third Quarter, Balance Sheet and Cash Flow section.
· EBITDA and EBITDA margin: EBITDA is earnings before interest,
tax, depreciation and amortisation. A reconciliation of EBITDA to profit
before tax is shown on the income statement. EBITDA margin is calculated as
EBITDA divided by revenue. Progression in EBITDA margin is an important
indicator of the Group's performance and this has been identified as one of
the Group's key performance indicators.
· Fleet age: original cost weighted age of serialised rental
assets. Serialised rental assets constitute the substantial majority of our
fleet.
· Fleet on rent: quantity measured at original cost of our rental
fleet on rent. Fleet on rent has been identified as one of the Group's key
performance indicators.
· Net debt: net debt is total borrowings (bank, bonds) and lease
liabilities less cash balances, as reported. This measure is used to provide
an indication of the Group's overall level of indebtedness and is widely used
by investors and credit rating agencies. An analysis of net debt is provided
in Note 14.
· Operating profit and operating profit margin: Operating profit is
earnings before interest and tax. A reconciliation of operating profit to
profit before tax is shown on the income statement. Operating profit margin
is calculated as operating profit divided by revenue. Progression in
operating profit margin is an important indicator of the Group's performance.
· Organic: organic measures comprise all locations, excluding
locations arising from a bolt-on acquisition completed after the start of the
comparative financial period.
· Rental only revenue: rental revenue excluding loss damage waiver,
environmental fees, erection and dismantling revenue and revenue from rental
equipment delivery and collection.
· Same-store: same-stores are those locations which were open at
the start of the comparative financial period.
· Segment profit: operating profit before amortisation by segment.
· Suppressed availability: represents the amount on a given date
that the asset base exceeds the facility size under the terms of our $4.75bn
asset-backed senior bank facility.
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