Ashtead Group to reorganise despite profits turn around

Ashtead Group plc, the equipment rental group serving the US and UK construction, has announced a proposed capital reorganisation - despite a complete turnaround in its profit fortunes.

Results for the fourth quarter and year ended 30 April 2005 showed that group full year pre-tax profits stood at £16.4m (2004: a loss of £33.1m), while Q4 pre-tax profit was £2.1m (2004: a loss of £10m).

Other highlights saw A-Plant full year profit nearly treble to £11.7m (2004: £4m); while debt was further reduced by £53.6m from cash flow despite 73% increase in capital expenditure to £125.5m.

Ashtead’s chief executive George Burnett said: “Strong performances by all three of our divisions drove a significant recovery in the Group’s full year results.

"In the UK, A-Plant delivered a near trebling of profits and a substantially improved return on capital.  Technology is now also benefiting strongly from increased investment in offshore oil exploration globally with its profits up 26% to £3.4m."

The capital reorganisation will provide, when finalised, a stable and appropriate long-term platform for the Group’s future development. 

It will complete the renewal of all the Group’s debt facilities and extend the average debt maturity to seven years. 

The Board also expects the reorganisation will enable it to propose to shareholders the resumption of dividends in respect of the year ending 30 April 2006.