Executive Hire News › Archives › October 2009 › City News : Stock Market Recovery
City News : Stock Market Recovery
Catherine Stratton assesses the growing optimism in the financial world and comments on Ashtead’s first quarter results.
Recent weeks have seen a growing optimism in the financial world that the worst of the recession may have passed. The FTSE 100 index is now close to the level of a year ago and economic commentators are beginning to see signs of recovery. There are still fears, however, that the recovery may not be sustained and certainly going into the winter, we can expect unemployment to continue to mount and construction activity to continue to lag as Government spending is squeezed.
SHARE PRICE PERFORMANCE
| Company |
Share Price (22.09.09) |
High |
Low |
Market Cap. (£m) |
| Aggreko |
712p |
728.5p |
342p |
1,950 |
| Ashtead |
87p |
96.5p |
24.5p |
466 |
| Speedy |
41.75p |
124.86p |
9.43p |
240 |
| Vp |
193p |
212p |
108p |
89 |
| Andrews Sykes |
95p |
110p |
50.80p |
42 |
Hire shares have joined in the general upturn with Aggreko, Ashtead and Vp all achieving new 52 week ‘highs’ in the past month. Speedy shares have also hit their highest levels since the July rights issue.
Ashtead’s first quarter results show that revenues are continuing to fall significantly at A-Plant, which had reduced its number of outlets to 115 by the end of July, compared with 122 in April, and 188 in July 2008. In line with this fall, fleet size has also dropped substantially from £385m at original cost in July 2008 to £318m. Ashtead says it is expecting market conditions to remain largely unchanged in its second quarter (i.e. August-October) and admits the picture is “less clear” for the rest of its financial year.
ASHTEAD: FIRST QUARTER RESULTS
| Underlying |
3 mths to 31.07.09 (£m) |
3 mths to 31.07.08 (£m) |
% Change |
| Revenue |
221.6 |
273.4 |
-19 |
| Operating profit |
23.9 |
51.7 |
-54 |
| Pre-tax profit |
8.8 |
35.9 |
-75 |
| Profit before tax |
8.2 |
35.2 |
-77 |
Note: Underlying revenue and profit are stated before exceptional items and amortisation
ASHTEAD: TRADING RESULTS
| Revenue (£m) |
|
|
|
| |
31.07.09 |
31.07.08 |
% Change |
| Sunbelt |
179.0 |
213.8 |
-16.3 |
| A-Plant |
42.6 |
59.6 |
-28.5 |
| |
221.6 |
273.4 |
-18.9 |
| Operating Profit (£m) |
|
|
|
| |
31.07.09 |
31.07.08 |
% Change |
| Sunbelt |
24.3 |
46.5 |
-47.7 |
| A-Plant |
1.1 |
7.1 |
-84.5 |
| Group costs |
(1.5) |
(1.9) |
-21.1 |
| |
23.9 |
51.7 |
-53.8 |
NEWS IN BRIEF
Vp has issued an interim management statement indicating that conditions remain ‘challenging’ with demand in general contracting ‘softening’ and housebuilding ‘stabilising’ at a low level. The UK infrastructure and regulated utility markets, however, are continuing to provide ‘good opportunities’ for Vp’s specialist businesses. With significantly reduced levels of capital expenditure, Vp’s debt levels are falling and the statement describes the business as being in ‘excellent financial health’ and affirms that ‘subject to no further deterioration in our markets, we remain in a position to deliver another satisfactory result in the current financial year.’ • |
