Ashtead Plans Share Buyback

Ashtead Group (AHT.L) said that it expects to spend a minimum of 500 million pounds ($628.7 million) on share buy-backs in fiscal 2020 after the British industrial equipment rental firm reported a surge in full year revenue and pre-tax profit.

Reported revenue rose to 4.50 billion pounds during the 12 months that ended April 30, from 3.71 billion pounds a year ago, due to strong growth in the US and Canadian markets, the London-based group said in its earnings statement on Tuesday.

Underlying profit before tax climbed to 1.11 billion pounds at constant exchange rates from 927 million pounds a year earlier, as the company said it had continued to execute its strategy of supplementing organic growth with targeted bolt-on acquisitions.

Ashtead invested 1.6 billion pounds on capital goods and a further 622 million pounds on takeovers in the period under review, while maintaining leverage within its target range of 1.5 to 2.0 times net debt to earnings before interest, tax, depreciation, and amortization.

“This investment reflects the structural growth opportunity that we continue to see in the business as we broaden our product offering, geographic reach, and end markets, thus increasing market share and diversifying our business,” Chief Executive Officer Brendan Horgan said in the statement.

The group, whose total dividend is expected to be 40.0 pence per share in fiscal 2019 from 33.0 pence per share in the prior-year period, said it has completed a 675 million pound share buyback program set out in December 2017. It now expects to spend a minimum of 500 million pounds on share buybacks in 2019/20.

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