Ashtead Narrows Guidance After Profit Miss on Slower U.S. Activity
By Michael Susin
Ashtead Group reported a worse-than-expected pretax profit decline for the its fiscal third quarter and narrowed its full-year guidance due to a lower level of activity in the North America market.
The London-listed equipment rental company on Tuesday said that for the quarter ended Jan. 31 pretax profit was $442 million, compared with a pretax profit of $505.1 million for the prior year. This compares with market consensus of $473.6 million, taken from Visible Alpha and based on 14 analysts' forecasts.
Revenue rose to $2.66 billion from $2.43 billion, ahead of market expectations of $2.16 billion.
Rental revenue rose 7% to $2.36 billion from $2.19 billion, but missed consensus of $2.40 billion. The company said that revenue growth in North America was affected by the lower level of emergency-response activity related to natural disasters and the longer-than-anticipated actors' and writers' strikes.
However, the group said that the U.S. market remains robust and with healthy demand, driven by the increasing number of mega projects, and rental revenue is expected to reach mid to high single digit percentage growth, with significant free cash flow generation.
For the nine month-period ended Jan. 31, the company made a pretax profit of $1.70 billion compared with $1.69 billion the year before, and revenue was $8.23 billion from $7.22 billion
The company narrowed its fiscal guidance for 2024, as it sees group rental revenue growth to be at the low end of the 11%-13% range.
Write to Michael Susin at michael.susin@wsj.com
Corrections & Amplifications
This item was corrected at 1055 GMT because Ashtead was described as a subsea-equipment rental group. It is a equipment rental company.
(END) Dow Jones Newswires
March 05, 2024 02:38 ET (07:38 GMT)
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