FTSE 100-listed industrial equipment lessor Ashtead Group (AHT.L) reported a 25% rise in revenue to $2.25 billion (£1.84 billion) for the three months to the end of July, beating analysts’ expectations.
Ashtead said pretax profit was $526.8 million in the quarter ended July 31, compared with $415.8 million in the first quarter of fiscal 2022.
Excluding extraordinary and other non-recurring items, underlying profit before tax was $554.7 million compared to $436.5 million in the prior year.
Read more: FTSE 250: Aston Martin shares plunge after announcement of discounted rights issue
Revenue rose 25% to $2.25 billion in the first quarter. Rental revenue improved 26% to $2.07 billion, while operating profit rose 26% to $594 million and underlying profit rose 22% to $1.03 billion.
Despite the positive results, the company’s share price plunged as investors digested warnings of rising costs. Shares lost 3.2 percent in London on Tuesday morning, closing at 4,170.00 pence per share.
Despite the group’s improved quarterly performance, Ashtead warned that strong results had been offset by increased interest costs and said the company expected full-year adjusted pre-tax profit to be in line with previous expectations.
Read more: FTSE 250: Ashmore’s profits fall due to exodus from emerging markets
“We are in a position of strength and have the experience to overcome the challenges and capitalize on the opportunities presented by the market conditions we face, including supply chain bottlenecks, inflation, labor shortages and economic uncertainty – all factors we believe are driving ongoing structural change,” said Chief Executive Brendan Horgan.
Looking ahead, the London-listed industrial equipment rental company said there was “clear momentum in supportive end markets.”
The company, which operates in the UK and North America under the name Sunbelt Rentals, invested $669 million in capital in the business during the period, compared to $551 million in the previous year.
Watch: What is a recession and how do you recognize it?
