Speedy Hire, the U.K.-based tools, equipment, and plant-hire services company, has announced that it anticipates lower full-year profits due to weaknesses in certain end markets and seasonal product lines, as well as delays in the mobilization of significant contract wins.
While Speedy Hire has not provided a specific figure for its expectations for the year ending March 31, analysts estimate pretax profit expectations at £28.5 million, a significant increase from the £1.8 million recorded in the previous year.
The construction sector has posed challenges for Speedy Hire, leading to a slowdown in revenue growth from its National customers. In the third quarter, revenue growth from National customers only reached 3%, compared to 5% at the end of the first half. Additionally, revenue from Regional customers continued to decline by 6% year-on-year, consistent with the first half.
Furthermore, revenue from seasonal products was impacted by the warmer winter period. While Speedy Hire has managed to secure over £40 million of annualized revenue from new multi-year contracts with new and existing National customers, the mobilization of these contracts has experienced delays. As a result, the fiscal benefits of these new contracts will be marginal in 2024, with the full impact not expected until fiscal 2025.
Despite these challenges, Speedy Hire is focused on implementing its Velocity strategy and remains optimistic about the long-term benefits and opportunities it will bring.
Overall, Speedy Hire acknowledges the current obstacles but is determined to overcome them and deliver sustainable growth in the future.
-- By Joe Hoppe