Shares in Ashtead (LON:AHT) have fallen deep into the red this morning, even as the company delivered a rise in full-year revenues, having benefitted from the hurricanes in the US which boosted demand for rental equipment. The company, however, also disclosed that its after-tax profit had inched lower in the last quarter of its financial year.
As of 10:25 BST, Ashtead’s share price had given up 5.73 percent to2,236.00p, pressuring the benchmark FTSE 100 index which currently stands 0.55 percent in the red at 7,589.68 points. The group’s shares have added more than 38 percent to their value over the past year, as compared with less than one-percent gain in the Footsie.
Ashtead posts FY results
Ashtead announced in a statement this morning that its underlying rental revenue had jumped 21 percent to £2.9 billion in the financial year ended April 30, while its profit before tax had come in 21 percent higher at £793.4 million. The company saw strong growth in the US on account of the clean-up efforts following hurricanes Harvey, Irma and Maria during the reported period.
Ashtead, however, also reported that its fourth-quarter profit after taxation had slipped two percent year-on-year to £99.9 million, while its earnings per share were one percent down at 20.6p.
Analyst points to US exposure
“Even if FY results were relatively solid, the final dividend upped by 20% and the company is confident in the medium term outlook, this is not enough to detract from its significant exposure to the US, at a time when President Trump is fanning the flames of a potential trade war with China and maybe even allies,” said Mike van Dulken, head of research at Accendo Markets commented, as quoted by Proactive Investors.