RNS Number:4913S
Speedy Hire PLC
26 November 2003
26 November 2003
SPEEDY HIRE Plc
Interim results for the six months ended 27 September 2003
Speedy Hire is a leading provider of equipment hire services to UK contractors
and builders, industry, utilities and the public sector, operating from over 275
depots throughout the country. The Group is focused primarily on tool hire,
with complementary businesses specialising in portable accommodation, surveying
and power generation equipment.
HIGHLIGHTS
Unaudited Unaudited
2003 2002
(26 Weeks) (26 Weeks) % Change
Group Turnover #81.7m #69.3m +17.9
Group Operating Profit #10.7m #10.0m +6.2
Group Profit Before Taxation #9.0m #8.5m +6.8
Group Profit Before Goodwill Amortisation and Before
Taxation
#9.4m #8.8m +6.8
Earnings Per Share 1 17.9p 15.4p +16.8
Earnings Per Share 1 (with underlying tax rate 2) 16.7p 14.7p +13.5
Dividends Per Share 3.7p 3.3p +12.1
Gearing 74.5% 73.6%
Interest Cover x6.6 x6.4
1 Before goodwill amortisation
2 Estimated effective tax rate 21.5% and underlying tax rate 27.2%
* Like for like turnover in tool hire up 10%
* Strong expansion of specialist businesses
* 22 new depots added
* New #100m banking facility in place
* Investing to support future growth
Outlook
"The business case for hire remains as compelling as ever. Forecasts for the
construction sector remain strong and stable. Trading to date is in line with
our expectations and, provided there is no change in the general economic
outlook, the business remains on track to deliver a year of further progress."
- David Wallis - Chairman
For further information:
Speedy Hire Plc Hudson Sandler
John Brown (Chief Executive) Nick Lyon, Keith Hann
Neil O'Brien (Group Finance Director) Tel: 020 7796 4133
Wednesday only: 020 7796 4133
Thursday onwards: 01942 720000
There will be a meeting for analysts at 10am on Wednesday 26 November at the
offices of Hudson Sandler, 29 Cloth Fair, London EC1A 7NN
SPEEDY HIRE Plc
Interim Results for the six months ended 27 September 2003
It has been another busy six months for Speedy Hire which has resulted in
further solid progress. Our key objectives were to grow the business both
organically and through acquisitions, continue to expand market share and to
build on the foundations already laid in strengthening the organisation. We are
pleased to report progress in all these areas.
Financial Results
Group turnover was #81.7 million (2002: #69.3 million) an increase over the same
period last year of 17.9%, while operating profit was #10.7 million (2002: #10.0
million) an increase of 6.2%. Profit before goodwill amortisation and before
tax rose to #9.4 million (2002: #8.8 million) an increase of 6.8% and earnings
per share increased from 15.35 pence to 17.93 pence, up by 16.8%.
Strong growth in turnover was driven by an excellent performance from our
Specialist businesses, the addition of 22 new depots and a robust like for like
turnover increase of 10% in the tool hire operations. Once again, this was well
ahead of market growth and consolidates Speedy Hire's position as clear industry
leader.
Operating margins in Hire Services eased from 16% to 15%. This was mainly as a
result of non-recoverable cost increases, principally the rise in National
Insurance contributions, the increase in fuel costs, and the costs associated
with establishing our new Scottish company.
In June a new #100 million banking facility was arranged enabling us to manage
our debt on a more structured basis, rather than use hire purchase agreements as
we have done for many years. Net debt at the end of the half year stood at
#63.6 million (2002: #54.6 million) producing gearing of 75% (2002: 74%).
Working capital continues to be closely controlled. Interest was covered 6.6
times by operating profit (2002: 6.4 times). Gross capital expenditure in the
half year was #28.2 million (2002: #16.2m) and in addition #7.3 million was
spent in acquiring businesses (2002: #nil). Return on capital was 15.2% (2002:
15.8%), well above the sector average.
Dividend
On the strength of these results, the Board intends to pay an interim dividend
of 3.7 pence per share (2002: 3.3 pence) a 12% increase on the same period last
year. The interim dividend will be paid on 30 January 2004 to all those
shareholders on the register on 5 January 2004.
Board Changes
We are constantly seeking to strengthen Speedy Hire and were delighted to
welcome Andrew Simpson to the board as an executive director in August 2003.
Andrew joins from Rothschild as Business Development Director. His background
and skills complement those of the executive team and he is already making a
valuable contribution.
Business Review
We added 22 new depots during the half year, bringing the total number of depots
operated by the Group to 279, leaving us well placed to achieve our target
number of openings for the year. Eight were greenfield openings and 14 were
brought in through acquisitions. In July, we acquired Kingfisher Hire, adding
seven tool hire depots in South Wales. Later in the same month, we acquired
Ashtead Plant's Big Air division, specialising in portable, high capacity, high
pressure compressed air systems, which provided an excellent fit for Speedy
Power. In August, we acquired St. Vincent Plant, the hire business of the
Clugston Group. This brought in a net six depots in Yorkshire and Lincolnshire
and was a good fit with our existing network. We also signed a three year
trading agreement with the Clugston Group. Since the half year we have
acquired the construction surveying equipment hire division of Leica Geosystems,
providing an excellent bolt-on opportunity for Speedy Survey.
All four acquisitions have been acquired for sensible sums and are being
successfully integrated within their respective divisions.
Speedy Hire has been growing rapidly over recent years and we have a strategy to
reach 400 depots in the medium term. To support this growth we are investing
further in the support infrastructure such as marketing, business development
and I.T. The market is demanding on-going improvements to meet changing demands
and Speedy Hire is committed to meeting customers' expectations.
Outlook
The business case for hire remains as compelling as ever, given the ever tighter
regulatory environment. Forecasts for the construction sector remain strong and
stable and we re-iterate our key strengths of diversity of customers, diversity
of activities and our national network and broad geographical spread.
We continue to operate in a solid commercial environment and trading to date is
in line with our expectations and, provided there is no change in the general
economic outlook, the business remains on track to deliver a year of further
progress.
David W Wallis John E Brown
Chairman Chief Executive
SPEEDY HIRE Plc
PROFIT AND LOSS ACCOUNT
FOR THE SIX MONTHS ENDED 27 SEPTEMBER 2003
Unaudited Unaudited Audited
Note 26 Weeks 26 Weeks Year
to to to
27 September 29 September 30 March
2003 2002 2003
#'000 #'000 #'000
Turnover 2 81,701 69,290 147,187
Operating profit 2
- Before goodwill amortisation 11,034 10,389 21,770
- Goodwill amortisation (369) (342) (684)
---------- ---------- ----------
10,665 10,047 21,086
Interest payable (net) (1,627) (1,581) (2,879)
---------- ---------- ----------
Profit on ordinary activities before taxation 9,038 8,466 18,207
Taxation 6 (1,940) (2,424) (4,946)
---------- ---------- ----------
Profit on ordinary activities after taxation 3 7,098 6,042 13,261
Dividends 3, 8 (1,539) (1,372) (3,743)
---------- ---------- ----------
Retained profit for the period 3 5,559 4,670 9,518
===== ===== =====
All turnover and operating profit has arisen from continuing operations.
Earnings per share
- Basic (pence) 7 17.07 14.53 31.89
===== ===== =====
- Diluted (pence) 16.78 14.35 31.44
===== ===== =====
- Pre-goodwill amortisation (pence) 7 17.93 15.35 33.53
===== ===== =====
- Pre-goodwill amortisation with
underlying tax rate (pence) 7 16.69 14.71 31.90
===== ===== =====
Dividends per share (pence) 8 3.70 3.30 9.00
===== ===== ====
SPEEDY HIRE Plc
BALANCE SHEET
AS AT 27 SEPTEMBER 2003
Unaudited Unaudited Audited
Note As at As at As at
27 September 29 September 30 March
2003 2002 2003
#'000 #'000 #'000
Fixed assets
Intangible assets 5,162 4,382 4,040
Tangible assets 146,941 122,862 129,466
----------- ----------- -----------
152,103 127,244 133,506
----------- ----------- -----------
Current assets
Stocks 3,477 3,174 3,217
Debtors 50,939 46,963 44,091
Cash at bank and in hand 3,631 - 7
----------- ----------- -----------
58,047 50,137 47,315
Creditors: amounts falling due within one
year (45,297) (60,291) (63,577)
----------- ----------- -----------
Net current assets/(liabilities) 12,750 (10,154) (16,262)
----------- ----------- -----------
Total assets less current liabilities 164,853 117,090 117,244
Creditors: amounts falling due after
more than one year (66,440) (32,676) (25,402)
Provisions for liabilities and charges (13,151) (10,228) (12,447)
----------- ----------- -----------
Net Assets 85,262 74,186 79,395
===== ===== =====
Capital and reserves
Called-up share capital 2,130 2,130 2,130
Share premium account 32,537 32,537 32,537
Merger reserve 3,660 3,660 3,660
Revaluation reserve 51 390 51
Investment property revaluation reserve 140 665 177
Capital redemption reserve 26 26 26
Profit and loss account 46,718 34,778 40,814
---------- ---------- ----------
Equity shareholders' funds 3 85,262 74,186 79,395
===== ===== =====
SPEEDY HIRE Plc
CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 27 SEPTEMBER 2003
Unaudited Unaudited Audited
Note 26 Weeks to 26 Weeks to Year to
27 September 29 September 30 March
2003 2002 2003
#'000 #'000 #'000
Cash inflow from operating activities 4 23,259 17,321 39,066
---------- ---------- ----------
Returns on investments and servicing of
finance
Interest received - - 76
Interest paid (804) (365) (771)
Interest element of hire-purchase and
finance lease rental payments (530) (1,216) (2,184)
---------- ---------- ----------
Net cash outflow from returns on
investments and servicing of finance (1,334) (1,581) (2,879)
---------- ---------- ----------
Taxation (1,373) (3,179) (5,618)
---------- ---------- ----------
Capital expenditure
Purchase of tangible fixed assets (23,219) (3,686) (12,597)
Sale of tangible fixed assets 6,769 7,609 15,898
---------- ---------- ---------
Net cash (outflow)/inflow for capital
expenditure (16,450) 3,923 3,301
---------- ---------- ----------
Acquisitions and disposals
Purchase of businesses 9 (7,269) - -
---------- ---------- ----------
Net cash outflow from acquisitions and
disposals (7,269) - -
---------- ----------- ----------
Equity dividends paid (2,371) (2,079) (3,451)
---------- ---------- ----------
Cash (outflow)/inflow before financing (5,538) 14,405 30,419
Financing
Issue of share capital - 51 51
New bank loans 5 65,399 - -
Capital element of hire-purchase and finance
lease rental payments 5 (52,190) (10,456) (22,700)
---------- ---------- ----------
Net cash inflow/(outflow) from financing 13,209 (10,405) (22,649)
---------- ---------- ----------
Increase in cash in the period 5 7,671 4,000 7,770
===== ===== =====
NOTES
1. Basis of Accounting
The interim statement has been prepared on the basis of the accounting
policies as set out in the financial statements for the year ended
30 March 2003. The financial information contained in this interim report
does not constitute statutory accounts for the Group for the relevant
periods.
2. Turnover and Operating Profit
Unaudited Unaudited Audited
26 Weeks to 26 Weeks to Year to
27 September 29 September 30 March
2003 2002 2003
#'000 #'000 #'000
Turnover
Hire Services 81,678 69,156 147,003
Central including property income 23 134 184
---------- ---------- ----------
Total 81,701 69,290 147,187
===== ===== =====
Turnover is derived from activities within the UK.
Operating Profit
Hire Services 12,247 11,179 23,753
Central overheads net of property income (1,582) (1,132) (2,667)
---------- ---------- ----------
Total 10,665 10,047 21,086
===== ===== =====
3. Movement in shareholders' funds
Unaudited Unaudited Audited
26 Weeks to 26 Weeks to Year to
27 September 29 September 30 March
2003 2002 2003
#'000 #'000 #'000
Profit for the period attributable to 7,098 6,042 13,261
the Group
Dividends (1,539) (1,372) (3,743)
---------- ---------- ----------
5,559 4,670 9,518
Unrealised surplus on revaluation of
properties - - 54
Shares issued - 51 51
Credit in respect of share related awards 308 308 615
---------- ---------- ----------
Net increase in shareholders' funds 5,867 5,029 10,238
Opening shareholders' funds 79,395 69,157 69,157
---------- ---------- ---------
Closing shareholders' funds 85,262 74,186 79,395
===== ===== =====
4. Reconciliation of operating profit to net cash flow from operating activities
Unaudited Unaudited Audited
26 Weeks to 26 Weeks to Year to
27 September 29 September 30 March
2003 2002 2003
#'000 #'000 #'000
Operating profit 10,665 10,047 21,086
Depreciation charge 11,918 10,297 21,109
Amortisation charge 369 342 684
Profit on sale of tangible fixed assets (2,389) (1,769) (4,263)
(Increase)/decrease in stocks (13) 190 147
(Increase)/decrease in debtors (6,848) (2,636) 235
Increase/(decrease) in creditors 9,249 542 (547)
Charge in respect of share related awards 308 308 615
---------- ---------- ----------
23,259 17,321 39,066
===== ===== =====
5. Reconciliation of net cash flow to movement in net debt
Unaudited Unaudited Audited
26 Weeks to 26 Weeks to Year to
27 September 29 September 30 March
2003 2002 2003
#'000 #'000 #'000
Increase in cash in the period 7,671 4,000 7,770
Cash inflow from increase in debt (65,399) - -
Cash outflow from decrease in hire-purchase
and lease financing 52,190 10,456 22,700
---------- ---------- ----------
Change in net debt resulting from cash flows (5,538) 14,456 30,470
New hire-purchase and finance lease contracts (4,932) (12,528) (27,024)
---------- ---------- ----------
Movement in net debt in the period (10,470) 1,928 3,446
Net debt at the start of the period (53,082) (56,528) (56,528)
---------- ---------- ----------
Net debt at the end of the period (63,552) (54,600) (53,082)
====== ====== ======
6. The charge for taxation for the period is based on the estimated effective
rate for the year of 21.5% (2002: 28.6%). The underlying effective tax rate
excluding adjustments in respect of prior years is estimated at 27.2%
(2002: 31.8%).
7. The calculation of basic earnings per share is based on the profit after
taxation of #7,098,000 (2002: #6,042,000) and the time weighted average
number of shares in issue during the period and ranking for dividends of
41,590,678 (2002: 41,584,274). The weighted average number of shares used
for the diluted earnings per share is calculated as follows:
Unaudited Unaudited Audited
26 Weeks to 26 Weeks to Year to
27 September 29 September 30 March
2003 2002 2003
Number Number Number
Weighted average number of ordinary shares in
issue during the period 41,590,678 41,584,274 41,587,476
Diluting effect of options under Allen Plc Savings
Related Share Option Scheme 9,260 5,056 -
Diluting effect of LTIP shares 712,659 515,757 591,232
--------------- --------------- --------------
Diluted weighted average number of ordinary shares 42,312,597 42,105,087 42,178,708
======== ======== ========
The table below reconciles basic earnings per share to both earnings per share
pre-goodwill amortisation, and earnings per share pre-goodwill amortisation with
underlying tax rate.
Unaudited Unaudited Audited
26 Weeks to 26 Weeks to Year to
27 September 29 September 30 March
2003 2002 2003 Pence
Pence Pence
Basic earnings per share 17.07 14.53 31.89
Goodwill amortisation charge after tax per share 0.86 0.82 1.64
---------- ---------- ----------
Earnings per share pre-goodwill amortisation 17.93 15.35 33.53
Adjustment to tax charge per share to reflect
underlying current year tax rate (1.24) (0.64) (1.63)
---------- ---------- ----------
Earnings per share pre-goodwill amortisation
with underlying tax rate 16.69 14.71 31.90
====== ====== ======
8. The Board has declared an interim dividend of 3.7 pence per share to be
paid on 30 January 2004 to shareholders on the register on 5 January 2004
9. Acquisitions during the period totalled #7,269,000 including provisional
goodwill of #1,491,000. Turnover and operating profits from acquisitions
in the period were #891,000 and #48,000 respectively.
10. The results for the year ended 30 March 2003 are extracts from the Annual
Report and Accounts as filed with the Registrar of Companies. These were
audited and reported upon without qualification by KPMG Audit Plc and did
not contain a statement under section 237(2) or (3) of the Companies Act
1985.
11. The interim report will be posted to all shareholders on or about
9 December 2003 and copies of this and the last published Annual Report
and Accounts are available from the Secretary, Speedy Hire Plc, Chase House,
16 The Parks, Newton-le-Willows, Merseyside, WA12 0JQ.
12. Approval
The interim statement for the six months ended 27 September 2003 was
approved by the Board of Directors on Monday 24 November 2003.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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