Speedy Hire Provides Trading Update, Announces Refinancing
Why we think this is neutral
The trading update from Speedy Hire indicates a mixed performance, with hire revenue marginally up but impacted by wider economic conditions and slower than anticipated growth in certain areas. While the company has generated positive cash flow and reduced debt levels, the outlook appears challenging with references to headwinds and delays in the rail sector. The valuation also seems quite high relative to the current performance. Overall, the sentiment is neutral as the company navigates through a difficult market environment.
Key Points
- Hire revenue marginally up on prior year, impacted by wider economic conditions and slower growth in Trade & Retail
- Net debt expected to be around £113m at year end, with strong cash inflows in final two months
- Refinanced banking facilities, replacing £180m asset-based lending facility with new £225m facilities
- New debt structure provides greater flexibility to support growth strategy
Summary
Speedy Hire Plc, the UK's leading provider of tools and equipment hire services, has provided a trading update for the year ended 31 March 2025 (FY2025). The Group expects to report results in line with its expectations, with hire revenue marginally up on the prior year. However, this was impacted by wider economic conditions and slower than anticipated growth in the Trade & Retail segment.
The company has remained focused on working capital management and expects to report net debt of around £113m at the year end, with strong cash inflows in the final two months. Speedy Hire has also refinanced its banking facilities, replacing the existing £180m asset-based lending facility with new £225m facilities comprising a £150m revolving credit facility and a £75m private placement term loan.
The new debt structure will provide the Group with greater flexibility to support its growth strategy. The company remains positive about its pipeline of opportunities and the actions taken to address cost pressures.