TIDMSDY
RNS Number : 6081S
Speedy Hire PLC
17 November 2021
Speedy Hire Plc
("Speedy", "the Company" or "the Group")
Results for the six months to 30 September 2021
Continued strong momentum, well positioned for further
growth
Speedy, the UK's leading provider of tools and equipment hire,
and services to the construction, infrastructure and industrial
markets, announces results for the six months to 30 September
2021.
Commenting on the results Russell Down, Chief Executive,
said:
"We have delivered another strong set of results through the
strength of our offering, efficient operational delivery and a
supportive market backdrop.
Our focus on ESG, digital and customer service including our
four-hour delivery promise, has once again yielded customer
renewals and market share gains.
Positive trading momentum in recent months and the significant
growth opportunities presented by major infrastructure projects
give us confidence in delivering full year results ahead of current
market expectations and sustainable growth in the medium term."
Underlying results (from continuing operations)
6 months 6 months Change
ended ended
30 September 30 September
2021 (GBPm) 2020 (GBPm)
Revenue (excluding disposals) 186.6 145.5 28.2%
-------------- -------------- ---------
EBITDA(1) 49.1 37.8 29.9%
-------------- -------------- ---------
Adjusted operating profit
('EBITA')(1) 16.2 6.3 GBP9.9m
-------------- -------------- ---------
Adjusted profit before tax(1) 14.6 4.1 GBP10.5m
-------------- -------------- ---------
Adjusted earnings per share
(pence)(2) 1.81 0.53 1.28p
-------------- -------------- ---------
Statutory results
6 months 6 months Change
ended ended
30 September 30 September
2021 (GBPm) 2020 (GBPm)
Revenue 188.6 147.0 28.3%
-------------- -------------- ---------
Operating profit 15.9 1.8 GBP14.1m
-------------- -------------- ---------
Profit/(loss) before tax 14.3 (0.4) GBP14.7m
-------------- -------------- ---------
Basic earnings per share
(pence) 1.81 0.15 1.66p
-------------- -------------- ---------
Other measures
6 months 6 months Change
ended ended
30 September 30 September
2021 2020
Net debt(3) GBP47.9m GBP57.8m 17.1%
-------------- -------------- -------
Return on Capital Employed(4) 12.4% 9.1% 3.3pp
-------------- -------------- -------
Dividend per share 0.75p - 0.75p
-------------- -------------- -------
Strategic and operational highlights
-- Continued strong trading performance:
o Revenue growth throughout H1 with strong performance in hire
+3.4% (Q1: 2.3%; Q2: 4.7%) compared to corresponding period in
FY2020
o Adjusted profit before tax from continuing operations ahead of
FY2021 and FY2020
o Continual improvement in asset utilisation due to the use of
artificial intelligence; up 1.8% to 57.3% as at 30 September
2021
o Costs tightly controlled; prior year efficiency initiatives
reinvested in growth priorities, notably people, ESG and digital
capabilities
o Further market share gains with a number of new contracts and
renewals with key customers including Costain, MGroup, Redrow Homes
and Willmott Dixon
-- Further strategic and operational progress:
o Improved customer experience through enhanced digital
platform
o Successful trial in 16 B&Q stores in H1 expanding retail
proposition through 7-day offering
o ESG initiatives delivering good progress; new Innovation
Centre in Milton Keynes opened in November 2021
-- Strong balance sheet and investment in capex:
o Cash and facility headroom of GBP131.0m (31 March 2021:
GBP142.3m)
o Bank facilities of GBP180m renewed to July 2024 providing
significant headroom for growth
o Net debt(3) at GBP47.9m (31 March 2021: GBP33.2m; 30 September
2020 GBP57.8m), with leverage(5) of 0.7x (31 March 2021: 0.5x; 30
September 2020: 0.9x)
o Significant investment in hire fleet of GBP37.6m with a focus
on carbon efficient ECO products
Current trading and outlook
-- FY2022 results expected to be ahead of current market expectations(6)
-- Market conditions remain positive:
o Infrastructure and construction sectors bolstered by major
projects
o Customer demand continues to improve into H2
-- Agreement signed with B&Q; 23 further stores to open from H2 generating incremental revenue
-- Targeted price increases offsetting cost pressures
-- Improvements to simplify and standardise operating model ongoing:
o Internal digital capabilities improved through successful
implementation of new cloud-based ERP system (Microsoft D365) in
October 2021
o Improved B2C platform under development to simplify the
digital customer journey
-- Dividend policy maintained; return to interim dividend
payments with proposed dividend of 0.75 pence per share. During
2022 the Board will consider returns to shareholders of any capital
in excess of the Group's needs consistent with the Group's capital
allocation policy
Enquiries:
Speedy Hire Plc Tel: 01942 720 000
Russell Down, Chief Executive
James Bunn, Chief Financial Officer
MHP Communications Tel: 0203 128 8778
Oliver Hughes
Andrew Jaques
Notes:
Explanatory notes:
(1) See note 9
(2) See note 7
(3) See note 12
(4) Return on Capital Employed: Profit before interest, tax,
amortisation and exceptional items divided by the average capital
employed (where capital employed equals shareholders' funds and net
debt(3) ), for the last 12 months.
(5) Leverage: Net debt(3) covered by EBITDA(1) . This metric
excludes the impact of IFRS 16.
(6) Analysts' consensus of GBP29.2m adjusted profit before
tax(1)
Inside Information: This announceme nt contains inside
information.
Forward looking statements: The information in this release is
based on management information. This report includes statements
that are forward looking in nature. Forward looking statements
involve known and unknown risks, assumptions, uncertainties and
other factors which may cause the actual results, performance or
achievements of the Group to be materially different from any
future results, performance or achievements expressed or implied by
such forward looking statements. Except as required by the Listing
Rules and applicable law, the Company undertakes no obligation to
update, revise or change any forward looking statements to reflect
events or developments occurring after the date of this report.
Notes to Editors: Founded in 1977, Speedy is the UK's leading
provider of tools and equipment hire services to a wide range of
customers in the construction, infrastructure and industrial
markets, as well as to local trade and industry. The Group provides
complementary support services through the provision of training,
asset management and compliance services. Speedy is certified
nationally to ISO50001, ISO9001, ISO14001, ISO17020, ISO27001 and
ISO45001. The Group operates from c.200 fixed sites across the UK
and Ireland together with a number of on-site facilities at client
locations, and through a joint venture in Kazakhstan.
Chief Executive's statement
Overview
Our half year results for the six months to 30 September 2021
(first half of FY2022) show continued momentum from the final
quarter of FY2021, which saw us return to pre-COVID-19 revenue
levels. Hire revenue has grown throughout the first half and was
3.4% ahead of H1 FY2020 which is a more meaningful comparison than
FY2021.
This strong performance results from our relentless focus on
excellent customer service and improved digital offering, which has
allowed us to grow market share. Market conditions are good and our
diversified customer base and the varied markets we operate within
provide resilience and optimism for the future. The recent trial
and subsequent agreement to partner with B&Q provides
opportunities within the B2C retail sector.
Strategy and operational review
Our vision is to be the best company in our sector to do
business with and the best to work for. We are constantly improving
the customer journey and working on several key strategic
initiatives to support this centred around our people, digital and
ESG.
Customer service remains our top priority. The strong hire
revenue performance reflects our industry leading four-hour
delivery promise. This covers our 350 most popular products with a
promise that any of these will be delivered nationally to customers
within four hours. The success of our customer service ethos is
evidenced through major customer wins and renewals across a broad
range of sectors including Costain, MGroup, Redrow Homes and
Willmott Dixon.
Our rehire business performed particularly well in the first
half, with revenues ahead of both FY2021 and FY2020 as we
experienced strong demand for a range of products, particularly
temporary accommodation. Overall services revenue from continuing
operations fell slightly from FY2020 as training revenue was
adversely affected by COVID-19 and market conditions. Whilst the
Group remains committed to short duration training aligned to our
core operations, we ceased the provision of NVQs and
Apprenticeships from July 2021.
Developing the retail business is a strategic priority and
supports our commitment to sustainability by providing consumers
with the option to hire, thereby promoting the circular economy
through the re-use of DIY tools and equipment. In FY2021 we
commenced a trial of outlets within B&Q stores. I am pleased to
report that following the successful trial in 16 stores we have
entered an agreement with B&Q to expand our presence into 39
stores. This new agreement demonstrates the strength of the Speedy
brand and our market leading customer service proposition.
We have invested further in developing our digital capabilities.
We have enhanced our website and App including the redesign of new
category and product pages, and improving our customer onboarding
and checkout processes to simplify the overall transaction. An
improved B2C platform is under development designed to further
simplify the digital customer journey.
In October we successfully completed our core system upgrade to
the latest cloud-based ERP application from Microsoft (Dynamics
365). The system provides a fully supported evergreen ERP platform
from which we can utilise cloud-based technologies to become a more
agile business. The next phase of its development will be to
utilise the rich functionality to drive operational efficiency,
consolidate peripheral applications and improve customer
interactions.
Artificial Intelligence (AI) remains integral to the management
of our hire fleet and utilisation rates. We have experienced
limited supply chain delays on certain products however these have
been mitigated through the strength of our supply chain
relationships and advanced planning by using AI. We invested
strategically in our hire fleet with capex of GBP37.6m in H1 with a
focus on carbon efficient ECO products.
We have recently implemented a targeted price increase following
product and customer reviews to mitigate cost pressures. Enhanced
governance and further use of AI in this area will facilitate more
dynamic pricing.
Our ESG framework underpins our commitment to operating
efficiently as a leading sustainable company. We are targeting net
zero by 2035 and are setting science-based targets this financial
year to provide a clearly defined pathway on how this will be
achieved. Following the appointment in April 2021 of an ESG
director, we have established an ESG committee from representatives
across the business to drive continuous improvement in our ESG
KPIs, which are aligned with the United Nations Sustainable
Development Goals. We are aiming to reduce our emissions per
employee by 10% in FY2022 with actions including the roll out of
HVO D+ fuel as a replacement for diesel in our commercial fleet. In
November 2021 we opened a new service centre in Milton Keynes which
showcases the latest in innovative products and technology. The
property is fitted with solar panels, rainwater harvesting, energy
efficient systems along with a living wall, bee hotels and a
wildflower garden. Sustainable products now make up c.28% of
revenues and we expect this to grow significantly as the industry
moves towards achieving net zero carbon targets.
Group financial performance
Results and commentary are presented on a continuing operations
basis unless otherwise noted, reflecting the disposal of the Middle
East business in March 2021. Comparative amounts in the income
statement are to 30 September 2020, which was affected by the
COVID-19 pandemic. To aid understanding of the underlying
performance, comparison to H1 FY2020 is given where relevant.
Revenue (excluding disposals) for the period to 30 September
2021 increased by 28.2 % to GBP 186.6m (H1 FY2021: GBP145.5m),
following a recovery in activity levels compared to the prior year
which was affected by the COVID-19 pandemic. Revenue from disposals
was GBP 2.0m (H1 FY2021: GBP1.5m); total revenue for the period
increased by 28.3 % to GBP 188.6 m (H1 FY2021: GBP147.0m).
Gross profit was GBP 108.0m (H1 FY2021: GBP80.9m), an increase
of 33.5 %. The gross margin increased to 57.3 % (H1 FY2021: 55.0%),
reflecting the increase in core hire revenue with largely fixed
depreciation costs.
EBITDA increased by 29.9 % to GBP 49.1m (H1 FY2021: GBP37.8m).
EBITA increased by GBP9.9m to GBP 16.2m (H1 FY2021: GBP6.3m), and
profit before taxation, amortisation and exceptional costs
increased to GBP14.6m from GBP4.1m in H1 FY 2021. The Group
incurred no exceptional items during the period (H1 FY2021:
GBP4.1m).
After taxation, amortisation, exceptional items, and
discontinued operations the Group made a profit of GBP 9.5m (H1
FY2021: GBP0.8m).
Segmental analysis
The Group's segmental reporting is split into UK and Ireland,
and Corporate. The figures in the tables below are presented before
the results of the joint venture, corporate costs, and exceptional
items.
6 months ended 6 months ended Movement
30 September 30 September
UK and Ireland 2021 2020
GBPm GBPm %
Revenue (excluding
disposals) 186.6 145.5 28.2
EBITDA 51.2 39.8 28.6
EBITA 18.4 8.7 111.5
Hire revenues increased by 31.8%, reflecting the impact of the
first lockdown in April 2020. Revenue made a progressive recovery
throughout FY2021 with growth continuing through the current
financial year to date. Revenue in H1 was 3.4% ahead of the
corresponding period in FY2020. A number of new and renewed
contracts with key customers have been secured in the period which
reflects the strength of our market position.
Services revenues have increased by 22.2% compared to H1 FY2021,
with a strong performance from our rehire business, which reacted
quickly to changing customer demands during COVID-19. Overall
services revenue for the period was affected by the decision to
cease the provision of NVQs and Apprenticeships from July 2021
.
Gross margins increased from 55.0% in H1 FY2021 to 57.3 %. Hire
margin recovered to 77.3 % ( H1 FY2021 : 74.8%), as volumes
increased, utilisation improved further and other direct costs
remained tightly controlled. Asset utilisation increased to 57.3%
at 30 September 2021, 1.8 percentage points above the comparable
period in FY2020 as a result of continued use of AI to connect
customer demand with asset availability. Increased supply chain
lead times have been mitigated by the use of AI to support our
replenishment and asset rebalancing programme.
Services margin has been adversely impacted by the comparably
lower training revenues, which contributed a higher margin than
other service revenues.
Overheads remain well controlled and are broadly flat with
FY2020. Improvements have been made to simplify and standardise our
operating model, including the consolidation of a number of depots
into larger customer focused centres. The cost savings from these
initiatives have been reinvested in our people, ESG and technology.
The results for the period do not include any government furlough
or loan support.
The UK and Ireland headcount at 30 September 2021 was 3,339 (31
March 2021: 3,253), an increase of 2.6%. 89 colleagues are now
employed within B&Q stores (31 March 2021: 50).
International
Following the disposal of the Middle East business on 1 March
2021, the Group successfully concluded the transitional services
arrangement in the period; the Group will now formally wind up its
operations in the region.
Interest
The Group's net financial expense remained flat at GBP 2.8m (H1 FY2021: GBP2.8m).
The Group's main bank facilities were renewed in July 2021 for a
three year term. Borrowings under the facility are now priced based
on SONIA (LIBOR prior to renewal) plus a variable margin, while any
unutilised commitment is charged at 35% of the applicable margin.
During the period, the margin payable on the outstanding debt
fluctuated between 1.50% and 2.05% dependent on the weighting of
borrowings between receivables and plant and machinery. The
effective average margin in the period was 1.72 % (H1 FY2021:
1.84%).
The Group utilises interest rate hedges to manage fluctuations
in rates. The fair value of these hedges was not material at 30
September 2021 and they have varying maturity dates.
Interest on lease liabilities of GBP 1.3m (H1 FY2021: GBP1.2m)
was incurred during the period.
Taxation
The tax charge for the period was GBP 5.0m (H1 FY2021: GBP0.6m),
reflecting a projected full year effective tax rate before
amortisation and exceptional items of 28.2% (H1 FY2021: 20.3%). An
increase in the UK corporation tax rate to 25% for periods from 1
April 2023 was substantively enacted on 24 May 2021. This rate has
been used to calculate the deferred tax assets and liabilities and
has resulted in the increased effective rate of tax for the period.
The impact of the rate change is an increase of GBP2.0m in the net
deferred tax liability as at 30 September 2021; excluding the
impact of this change in tax rate, the effective rate would be
21.4% before exceptional items and amortisation.
Shares and earnings per share
At 30 September 2021, 528,498,631 Speedy Hire Plc ordinary
shares were outstanding, of which 4,084,165 were held in the
Employee Benefit Trust. Adjusted earnings per share was 1.81 pence
(H1 FY2021: 0.53 pence), an
increase of 1.28p. Basic earnings per share was 1.81 pence (H1 FY2021: 0.15 pence).
Capital expenditure
Total capital expenditure during the period amounted to GBP
43.7m (H1 FY2021: GBP9.3m), of which GBP 37.6m (H1 FY2021: GBP7.2m)
related to equipment for hire, and GBP 6.1m related to other
property, plant and equipment (H1 FY2021: GBP2.1m).
Our hire fleet investment of GBP37.6m in H1 was biased toward
carbon efficient ECO products. The average age of the fleet is 3.6
years (H1 FY2021:3.9 years) one of the youngest fleets in the
industry. Whilst we have experienced some limited supply chain
pressures, the strength of our supplier relationships and advanced
planning have mitigated the impact.
ROCE and balance sheet
The Group has a strong balance sheet and is well placed to
continue to pursue financial and strategic objectives as demand
improves.
Net assets at 30 September 2021 were GBP 222.9m (31 March 2021:
GBP219.2), equivalent to 42 pence per share. ROCE was 12.4 % for
the 12 months to September 2021 ( 12 months to 30 September 2020 :
9.1%).
Net property, plant and equipment (excluding IFRS 16 right of
use assets) increased to GBP 248.4m at 30 September 2021 (31 March
2021: GBP233.1m). The net book value of equipment for hire has
increased from GBP207.2m to GBP 220.7m , representing 88.8 % (31
March 2021: 88.9%) of the total property, plant and equipment
balance.
Intangible assets increased marginally to GBP 25.0m (31 March
2021: GBP24.7m), with investment in software development partly
offset by amortisation charged.
Right of use assets of GBP 65.2m (31 March 2021: GBP59.1m) and
corresponding lease liabilities of GBP 70.9 m (31 March 2021:
GBP65.8m) were recognised at 30 September 2021. The increase is due
to various lease renewals and new leases entered into during the
period.
Gross trade receivables totalled GBP 95.5m at 30 September 2021
(31 March 2021: GBP93.5m), benefiting from continued strong cash
collections and focus on overdue debt. Bad debt and credit note
provisions increased to GBP 5.1m at 30 September 2021 (31 March
2021: GBP4.9m), equivalent to 5.3 % of gross trade receivables (31
March 2021: 5.2%). In setting the provisions the Directors have
given specific consideration to the impact of COVID-19 on the
general economy, particularly given the tapering of government
support. The Group has not experienced a significant worsening of
debt collections or debt write-offs although continues to monitor
the situation closely. UK and Ireland debtor days were 66.8 days
(31 March 2021: 59.4 days), consistent with September 2020 (65.5
days). Trade payables and accruals were GBP 96.7m (31 March 2021:
GBP94.8m). UK and Ireland creditor days were 89.8 days (31 March
2021: 81.6 days) down from September 2020 (101.8 days).
Cash flow and net debt
Cash generated from operations for the period was GBP 15.0m (H1
FY2021: GBP37.1m). Free cash flow (being net cash flow before
financing activities) decreased to GBP 3.7 m (H1 FY2021: GBP33.6m),
reflecting the increased spend on hire equipment.
Net debt increased by GBP 14.7 m from GBP33.2m at the beginning
of the period to GBP 47.9 m at 30 September 2021. Net debt to
EBITDA (rolling 12 months basis) increased to 0.7 x (31 March 2021:
0.5x).
The Group's continued strong cash position resulted in cash and
facility headroom of GBP 131.0 m within the Group's committed bank
facility (31 March 2021: GBP142.3m).
The Group's GBP180m asset based finance facility has been
renewed for three years, through to July 2024. In addition
uncommitted options exist for a further two one-year extensions
until July 2026. The additional uncommitted accordion of GBP220m
remains in place through to July 2024. The terms of the facility
are broadly similar to the expiring facility. The facility gives
the Group headroom with which to support organic growth and
acquisition opportunities.
The facility includes quarterly leverage and fixed charge cover
covenant tests which are only applied if headroom in the facility
falls below GBP18m. No covenant test was required during the
period, and the Group maintained significant headroom against these
measures.
Dividend
The Board is committed to maintaining an efficient balance sheet
and regularly reviews the Group's capital resources in light of the
medium-term investment requirements and in accordance with the
capital allocation policy set out below. The Board confirms today
that it intends to maintain the current dividend policy of paying
progressive dividends with a pay-out ratio of between 33% and 50%
of adjusted profit after tax for the financial year .
The Board has declared an interim dividend of 0.75 pence per
share ( H1 FY2021 interim dividend: nil pence per share; H1 FY2020
interim dividend 0.70 pence per share), to be paid on 21 January
2022 to shareholders on the register on 10 December 2021. This
represents a return to paying interim dividends following the
decision not to pay a dividend last year whilst in the midst of the
pandemic.
Capital allocation policy
The Board intends to continue to invest in the business in order
to grow revenue, profit and ROCE. This investment is expected to
include capital expenditure within existing operations, as well as
value enhancing acquisitions that fit with the Group's strategy and
are returns accretive.
The Board's objective is to maximise long-term shareholder
returns through a disciplined deployment of cash generated, and it
has adopted the following capital allocation policy in support of
this:
- Organic growth: the Board will invest in capital equipment to
support demand in our chosen markets. This investment will be in
hire fleet and IT systems to better enable us to serve our
customers;
- Regular returns to shareholders: the Board intends to pay a
regular dividend to shareholders, with a policy of growing
dividends through the business cycle, and a payment in the range of
between 33% and 50% adjusted earnings per share;
- Acquisitions: the Board will continue to explore value
enhancing acquisition opportunities in markets adjacent to, and
consistent with its existing operations;
- Gearing and treatment of excess capital: the Board is
committed to maintaining an efficient balance sheet. The Board has
adopted a target gearing in the region of 1.5x net debt to EBITDA
through the business cycle, although it is prepared to move outside
this if circumstances warrant.
The Board recognises that the Group's leverage of 0.7x remains
below its business cycle target of 1.5x. This has been appropriate
given the significant economic and market uncertainties during the
COVID-19 pandemic. The Board continues to believe that a strong
balance sheet is appropriate for the current stage of the cycle to
allow the company take full advantage of opportunities that arise
as markets recover. During 2022 the Board will review the
medium-term capital needs of the Group and will consider potential
returns to shareholders of any capital in excess of the Group's
needs consistent with its capital allocation policy.
Board
Carol Kavanagh joined the Board and Remuneration Committee of
the Company on 1 June 2021 as an Independent Non-executive
Director. Carol has over 20 years of experience working in senior
public company human resource roles across construction and retail
sectors, including as Group HR Director for Travis Perkins Plc from
2007 to 2020. After allowing time for Carol to settle into her
role, Rhian Bartlett stepped down from the Remuneration Committee
on 16 November in keeping with the Company's current policy of
staffing its Board Committees with three Independent Non-executive
Directors.
Summary and outlook
We have delivered another strong set of results through the
strength of our offering, efficient operational delivery and a
supportive market backdrop.
Our focus on ESG, digital and customer service including our
four-hour delivery promise, has once again yielded customer
renewals and market share gains.
Positive trading momentum in recent months and the significant
growth opportunities presented by major infrastructure projects
give us confidence in delivering full year results ahead of current
market expectations and sustainable growth in the medium term.
Russell Down
Chief Executive
Interim condensed consolidated income statement
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
Note GBPm GBPm GBPm
Revenue 4 188.6 147.0 332.3
Cost of sales (80.6) (66.1) (147.4)
---------- ---------- ----------
Gross profit 108.0 80.9 184.9
Distribution and administrative
costs (92.1) (79.1) (172.4)
----------------------------------- ---- ------------- ------------- -----------------
Analysis of operating profit
Operating profit before
amortisation and exceptional
items 16.2 6.3 21.7
Amortisation (0.3) (0.4) (0.8)
Exceptional items 3 - (4.1) (8.4)
----------------------------------- ---- ------------- ------------- -----------------
Operating profit 15.9 1.8 12.5
Share of results of joint
venture 1.2 0.6 1.2
---------- ---------- ----------
Profit from operations 17.1 2.4 13.7
Financial expense 5 (2.8) (2.8) (5.4)
---------- ---------- ----------
Profit/(loss) before taxation 14.3 (0.4) 8.3
Taxation 6 (5.0) (0.6) (2.2)
---------- ---------- ----------
Profit/(loss) for the financial
period from continuing operations 9.3 (1.0) 6.1
---------- ---------- ----------
Profit from discontinued
operations, net of tax 0.2 1.8 3.4
---------- ---------- ----------
Profit for the financial
period 9.5 0.8 9.5
Earnings per share
- Basic (pence) 7 1.81 0.15 1.82
- Diluted (pence) 7 1.79 0.15 1.79
Non-GAAP performance measures
(continuing operations)
EBITDA before exceptional
items 9 49.1 37.8 85.3
Adjusted profit before tax 9 14.6 4.1 17.5
Adjusted earnings per share
(pence) 7 1.81 0.53 2.68
Interim condensed consolidated statement of comprehensive
income
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
GBPm GBPm GBPm
Profit for the financial period 9.5 0.8 9.5
---------- ---------- ----------
Other comprehensive income that may
be reclassified subsequently to the
Income Statement:
- Effective portion of change in
fair value of cash flow hedges 0.4 (0.2) 0.2
- Exchange difference on retranslation
of foreign operations 0.4 (0.8) (1.4)
---------- ---------- ----------
Other comprehensive income, net of
tax 0.8 (1.0) (1.2)
---------- ---------- ----------
Total comprehensive income/(loss)
for the financial period 10.3 (0.2) 8.3
Interim condensed consolidated balance sheet
30 September 30 September 31 March
2021 2020 2021
Note GBPm GBPm GBPm
ASSETS
Non-current assets
Intangible assets 25.0 22.8 24.7
Investment in joint venture 7.5 6.6 6.2
Property, plant and equipment
- Hire equipment 10 220.7 212.0 207.2
- Non-hire equipment 10 27.7 27.6 25.9
Right of use assets 11 65.2 58.9 59.1
Deferred tax assets 3.2 2.7 2.5
---------- ---------- ----------
349.3 330.6 325.6
---------- ---------- ----------
Current assets
Inventories 8.6 8.5 8.2
Trade and other receivables 99.4 95.4 93.3
Cash 12 6.5 18.9 11.7
Current tax asset - 0.4 1.1
---------- ---------- ----------
114.5 123.2 114.3
---------- ---------- ----------
Total assets 463.8 453.8 439.9
---------- ---------- ----------
LIABILITIES
Current liabilities
Borrowings 12 (1.0) - (0.5)
Lease liabilities (19.6) (18.5) (19.3)
Other financial liabilities (0.2) (0.7) (0.4)
Trade and other payables (96.7) (84.5) (94.8)
Current tax liabilities (0.6) - -
Provisions (3.8) (5.5) (3.1)
---------- ---------- ----------
(121.9) (109.2) (118.1)
---------- ---------- ----------
Non-current liabilities
Borrowings 12 (53.4) (76.7) (44.4)
Lease liabilities (51.3) (48.3) (46.5)
Provisions (2.1) (1.7) (2.9)
Deferred tax liabilities (12.2) (7.8) (8.8)
---------- ---------- ----------
(119.0) (134.5) (102.6)
---------- ---------- ----------
Total liabilities (240.9) (243.7) (220.7)
---------- ---------- ----------
Net assets 222.9 210.1 219.2
EQUITY
Share capital 26.4 26.4 26.4
Share premium 1.5 0.9 1.3
Merger reserve 1.0 1.0 1.0
Hedging reserve (0.3) (1.1) (0.7)
Translation reserve (0.6) (0.4) (1.0)
Retained earnings 194.9 183.3 192.2
---------- ---------- ----------
222.9 210.1 219.2
Interim condensed consolidated statement of changes in
equity
Share Share Merger Hedging Translation Retained Total
capital premium reserve reserve reserve earnings equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
At 1 April 2020 26.4 0.8 1.0 (0.9) 0.4 182.2 209.9
Total comprehensive income/(loss) - - - (0.2) (0.8) 0.8 (0.2)
Issue of shares under the
Sharesave Scheme - 0.1 - - - - 0.1
Equity-settled share-based
payments - - - - - 0.3 0.3
---------- ---------- ---------- ---------- ---------- ---------- ----------
At 30 September 2020 26.4 0.9 1.0 (1.1) (0.4) 183.3 210.1
Total comprehensive income/(loss) - - - 0.4 (0.6) 8.7 8.5
Issue of shares under the
Sharesave Scheme - 0.4 - - - - 0.4
Equity-settled share-based
payments - - - - - 0.2 0.2
---------- ---------- ---------- ---------- ---------- ---------- ----------
At 31 March 2021 26.4 1.3 1.0 (0.7) (1.0) 192.2 219.2
Total comprehensive income - - - 0.4 0.4 9.5 10.3
Dividends - - - - - (7.3) (7.3)
Issue of shares under the
Sharesave Scheme - 0.2 - - - - 0.2
Equity-settled share-based
payments - - - - - 0.5 0.5
---------- ---------- ---------- ---------- ---------- ---------- ----------
At 30 September 2021 26.4 1.5 1.0 (0.3) (0.6) 194.9 222.9
Interim condensed consolidated statement of cash flows
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
GBPm GBPm GBPm
Cash generated from operating activities
Profit before tax including discontinued
operations 14.5 1.4 12.3
Finance expense 2.8 2.9 5.9
Amortisation 0.3 0.4 0.8
Depreciation 32.9 32.8 68.1
Share of profit from joint venture (1.2) (0.6) (1.2)
Loss/(profit) on disposal of leases, property,
plant and equipment 0.7 1.2 (2.6)
(Increase)/decrease in working capital (8.0) 5.4 13.4
Movement in provisions (0.1) 0.1 (1.1)
Translation reserve recycled on disposal
of Middle East assets - - 1.0
Equity-settled share-based payments 0.5 0.3 0.5
---------- ---------- ----------
Cash generated from operations before changes
in hire fleet 42.4 43.9 97.1
Purchase of hire equipment, net of sale
proceeds (27.4) (6.8) (24.2)
---------- ---------- ----------
Cash generated from operations 15.0 37.1 72.9
Interest paid (4.3) (2.6) (6.0)
Tax (paid)/received (0.6) 1.0 (0.8)
---------- ---------- ----------
Net cash flow from operating activities 10.1 35.5 66.1
---------- ---------- ----------
Cash flow from investing activities
Purchase of other fixed assets, net of sale
proceeds (6.4) (3.2) (10.4)
Proceeds from disposal of Middle East assets - - 13.0
Investment in joint venture - 1.3 1.0
---------- ---------- ----------
Net cash flow from investing activities (6.4) (1.9) 3.6
---------- ---------- ----------
Net cash flow before financing activities 3.7 33.6 69.7
---------- ---------- ----------
Cash flow from financing activities
Payments for the principal element of leases (12.1) (12.0) (23.6)
Net drawdown/(repayment) of loans 9.8 (25.6) (58.2)
Proceeds from the issue of Sharesave Scheme
shares 0.2 0.1 0.5
Dividends paid (7.3) - -
---------- ---------- ----------
Net cash flow from financing activities (9.4) (37.5) (81.3)
---------- ---------- ----------
Decrease in cash and cash equivalents (5.7) (3.9) (11.6)
Cash and cash equivalents at the start of
the period 11.2 22.8 22.8
---------- ---------- ----------
Cash and cash equivalents at the end of
the period 5.5 18.9 11.2
Analysis of cash and cash equivalents
Cash 12 6.5 18.9 11.7
Bank overdraft 12 (1.0) - (0.5)
---------- ---------- ----------
5.5 18.9 11.2
1 Basis of preparation
Speedy Hire Plc ('the Company') is a company incorporated and
domiciled in the United Kingdom. The interim condensed consolidated
financial statements of the Company as at and for the six months
ended 30 September 2021 comprise the Company and its subsidiaries
(together referred to as 'the Group').
The financial statements of the Group for the year ended 31
March 2021 are available from the Company's registered office, or
from the website: www.speedyservices.com .
The Group has a GBP180m asset based finance facility ('the
facility') which matures in July 2024 and has no prior scheduled
repayment requirements. Cash and facility headroom as at 30
September 2021 was GBP131.0m (31 March 2021: GBP142.3m) based on
the Group's eligible hire equipment and trade receivables.
The Group meets its day-to-day working capital requirements
through operating cash flows, supplemented as necessary by
borrowings. The Directors have prepared a going concern assessment
up to 30 November 2022, which confirms that the Group is capable of
continuing to operate within its existing loan facility and can
meet the covenant requirements set out within the facility. The key
assumptions on which the projections are based include an
assessment of the impact of future market conditions on projected
revenues and an assessment of the net capital investment required
to support the expected level of revenues, including a continuation
of the impact of the economic uncertainty resulting from
COVID-19.
The Board has considered various possible downside scenarios to
the base case, which result in reduced levels of revenue across the
Group, whilst maintaining the same cost base. Mitigations applied
in these downturn scenarios include a reduction in planned capital
expenditure. Despite the significant impact of the assumptions
applied in these scenarios, the Group maintains sufficient headroom
against its available facility and covenant requirements.
Whilst the Directors consider that there is a degree of
subjectivity involved in their assumptions, on the basis of the
above the Directors have a reasonable expectation that the Company
and the Group have adequate resources to continue in operational
existence for a period of at least 12 months from the date of
approval of these interim condensed consolidated financial
statements. Accordingly, they continue to adopt the going concern
basis of accounting.
Statement of compliance
This condensed set of financial statements has been prepared in
accordance with IAS 34 Interim Financial Reporting as adopted for
use in the UK.
The annual financial statements of the group for the year ended
31 March 2022 will be prepared in accordance with UK-adopted
international accounting standards. As required by the Disclosure
Guidance and Transparency Rules of the Financial Conduct Authority,
the condensed set of financial statements has been prepared
applying the accounting policies and presentation that were applied
in the preparation of the company's published consolidated
financial statements for the year ended 31 March 2021 which were
prepared in accordance with International Financial Reporting
Standards (IFRSs) adopted pursuant to Regulation (EC) No 1606/2002
as it applies in the European Union and in accordance with
international accounting standards in conformity with the
requirements of the Companies Act 2006 except as described
below.
They do not include all the information required for full annual
financial statements, and should be read in conjunction with the
Group's consolidated financial statements as at and for the year
ended 31 March 2021.
The comparative figures for the financial year ended 31 March
2021 are not the Company's statutory accounts for that financial
year. Those accounts which were prepared under IFRS as adopted by
the EU (adopted IFRS) have been reported on by the Company's
auditors and delivered to the Registrar of Companies. The report of
the auditors was (i) unqualified, (ii) did not include a reference
to any matters to which the auditors drew attention by way of
emphasis without qualifying their report, and (iii) did not contain
a statement under section 498(2) or (3) of the Companies Act
2006.
The interim report was approved by the Board of Directors on 16
November 2021.
Significant accounting policies
Other accounting policies
In April 2021, the International Financial Reporting
Interpretations Committee ('IFRIC') published an agenda decision on
the clarification of accounting in relation to the configuration
and customisation costs incurred in implementing
Software-as-a-Service (SaaS). The Group's accounting policy has
been aligned with the IFRIC guidance as follows:
-- Amounts paid to cloud vendors for configuration and
customisation that are not distinct from access to the cloud
software are expensed over the SaaS contract term
-- Configuration and customisation costs incurred in
implementing SaaS arrangements which give rise to an identifiable
intangible asset are capitalised and amortised over the life of the
asset
-- Other implementation costs are expensed as incurred
There have been no new standards or interpretations issued or
endorsed by the International Accounting Standards Board (IASB) or
IFRIC since the date of the FY2021 year end financial statements
that materially impact the Group.
The accounting policies applied by the Group in these interim
condensed consolidated financial statements are otherwise the same
as those applied by the Group in its consolidated financial
statements as at and for the year ended 31 March 2021.
The carrying amount of goodwill is tested annually for
impairment and, along with other non-financial assets, at each
reporting date to the extent that there are any indicators of
impairment.
Seasonality
In addition to economic factors, revenue is subject to a small
element of seasonal fluctuation. Whilst construction activity tends
to increase in the summer months, the equipment range helps to
mitigate the impact, specifically with heating, lighting and power
generation products being more in demand during the winter months.
Overall, the Directors do not feel that these factors have a
material effect on the performance of the Group when comparing
first half results to those achieved in the second half.
2 Changes in estimates
The preparation of interim condensed consolidated financial
statements requires management to make judgements, estimates, and
assumptions that affect the application of accounting policies and
the reported amounts of assets and liabilities, income and expense.
Actual results may differ from these estimates.
In preparing the interim condensed consolidated financial
statements, the significant judgements made by management in
applying the Group's accounting policies and key sources of
estimation uncertainty for the consolidated financial statements
for the year ended 31 March 2021 continued to apply.
3 Exceptional items
During the period there were no exceptional items.
Prior period
During the year to 31 March 2021, exceptional administrative
items of GBP8.4m were incurred in respect of continuing
operations.
Action was taken to manage the Group's cost base following the
COVID-19 pandemic, and consequently the network was restructured.,
with a number of depot closures. As a result, GBP5.6m of property
provisions and GBP1.9m of redundancy costs were incurred during
that year. In addition, a further provision of GBP0.9m was made to
cover legal and other costs relating to the training business.
Of the GBP8.4m referred to above, GBP4.1m was incurred in the
period to 30 September 2020 being property provisions (GBP2.5m) and
redundancy costs (GBP1.6m).
4 Segmental analysis
The segmental disclosure presented in the interim condensed
consolidated financial statements reflects the format of reports
reviewed by the Chief Operating Decision Maker (CODM). UK and
Ireland delivers asset management, with tailored services and a
continued commitment to relationship management. The Middle East
assets which were previously classified as part of the
International segment were disposed on 1 March 2021 and are now
shown as discontinued operations. As a consequence of this change,
the results from the joint venture in Kazakhstan have been
reclassified as 'Corporate items', which also includes certain
central activities and costs not directly related to the activities
of the operating segments. The comparative period has been restated
to reflect this change.
For the six months ended 30 September 2021
UK and Ireland Corporate Total
items
GBPm GBPm GBPm
Revenue 188.6 - 188.6
Segment result:
EBITDA 51.2 (2.1) 49.1
Depreciation (32.8) (0.1) (32.9)
---------- ---------- ----------
Operating profit/(costs) before
amortisation and exceptional items 18.4 (2.2) 16.2
Amortisation (0.3) - (0.3)
---------- ---------- ----------
Operating profit/(costs) 18.1 (2.2) 15.9
Share of results of joint venture - 1.2 1.2
---------- ---------- ----------
Trading profit/(costs) 18.1 (1.0) 17.1
Financial expense (2.8)
----------
Profit before tax 14.3
Taxation (5.0)
----------
Profit for the financial period
from continuing operations 9.3
Profit from discontinued operations,
net of tax 0.2
----------
Profit for the financial period 9.5
Intangible assets 19.8 5.2 25.0
Investment in joint venture - 7.5 7.5
Hire equipment 220.7 - 220.7
Non-hire equipment 27.7 - 27.7
Right of use assets 65.2 - 65.2
Taxation assets - 3.2 3.2
Current assets 101.1 6.9 108.0
Cash - 6.5 6.5
---------- ---------- ----------
Total assets 434.5 29.3 463.8
Lease liabilities (70.9) - (70.9)
Other liabilities (89.8) (13.0) (102.8)
Borrowings - (54.4) (54.4)
Taxation liabilities - (12.8) (12.8)
---------- ---------- ----------
Total liabilities (160.7) (80.2) (240.9)
For the six months ended 30 September 2020
UK and Corporate Total- continuing Discontinued Total
Ireland items operations operations
GBPm GBPm GBPm GBPm GBPm
Revenue 147.0 - 147.0 16.8 163.8
Segment result:
EBITDA 39.8 (2.0) 37.8 3.2 41.0
Depreciation (31.1) (0.4) (31.5) (1.3) (32.8)
---------- ---------- ---------- ---------- ----------
Operating profit/(costs)
before amortisation and
exceptional items 8.7 (2.4) 6.3 1.9 8.2
Amortisation (0.4) - (0.4) - (0.4)
Exceptional items (4.1) - (4.1) - (4.1)
---------- ---------- ---------- ---------- ----------
Operating profit/(costs) 4.2 (2.4) 1.8 1.9 3.7
Share of results of joint
venture - 0.6 0.6 - 0.6
---------- ---------- ---------- ---------- ----------
Trading profit/(costs) 4.2 (1.8) 2.4 1.9 4.3
Financial expense (2.8) (0.1) (2.9)
---------- ---------- ----------
Profit before tax (0.4) 1.8 1.4
Taxation (0.6) - (0.6)
---------- ---------- ----------
(Loss)/profit for the financial
period (1.0) 1.8 0.8
Intangible assets 22.8 - 22.8 - 22.8
Investment in joint venture - 6.6 6.6 - 6.6
Hire equipment 202.1 - 202.1 9.9 212.0
Non-hire equipment 25.8 - 25.8 1.8 27.6
Right of use assets 56.7 - 56.7 2.2 58.9
Taxation assets - 3.1 3.1 - 3.1
Current assets 89.5 3.1 92.6 11.3 103.9
Cash - 18.9 18.9 - 18.9
---------- ---------- ---------- ---------- ----------
Total assets 396.9 31.7 428.6 25.2 453.8
Lease liabilities (63.1) - (63.1) (3.7) (66.8)
Other liabilities (78.6) (4.4) (83.0) (9.4) (92.4)
Borrowings - (76.7) (76.7) - (76.7)
Taxation liabilities - (7.8) (7.8) - (7.8)
---------- ---------- ---------- ---------- ----------
Total liabilities (141.7) (88.9) (230.6) (13.1) (243.7)
For the year ended 31 March 2021
Total-
UK and Corporate continuing Discontinued
Ireland items operations operations Total
GBPm GBPm GBPm GBPm GBPm
Revenue 332.3 - 332.3 31.3 363.6
Segment result:
EBITDA 89.5 (4.2) 85.3 5.2 90.5
Depreciation (63.2) (0.4) (63.6) (1.5) (65.1)
---------- ---------- ---------- ---------- ----------
Operating profit/(costs)
before amortisation and exceptional
items 26.3 (4.6) 21.7 3.7 25.4
Amortisation (0.8) - (0.8) - (0.8)
Exceptional items (8.4) - (8.4) 0.8 (7.6)
---------- ---------- ---------- ---------- ----------
Operating profit/(costs) 17.1 (4.6) 12.5 4.5 17.0
Share of results of joint
venture - 1.2 1.2 - 1.2
---------- ---------- ---------- ---------- ----------
Trading profit/(costs) 17.1 (3.4) 13.7 4.5 18.2
Financial expense (5.4) (0.5) (5.9)
---------- ---------- ----------
Profit before tax 8.3 4.0 12.3
Taxation (2.2) (0.6) (2.8)
---------- ---------- ----------
Profit for the financial
year 6.1 3.4 9.5
Intangible assets 20.1 4.6 24.7 - 24.7
Investment in joint venture - 6.2 6.2 - 6.2
Hire equipment 206.4 0.8 207.2 - 207.2
Non-hire equipment 25.9 - 25.9 - 25.9
Right of use assets 59.1 - 59.1 - 59.1
Taxation assets - 3.6 3.6 - 3.6
Current assets 96.5 2.2 98.7 2.8 101.5
Cash - 11.7 11.7 - 11.7
---------- ---------- ---------- ---------- ----------
Total assets 408.0 29.1 437.1 2.8 439.9
Lease liabilities (65.8) - (65.8) - (65.8)
Other liabilities (83.9) (8.8) (92.7) (8.5) (101.2)
Borrowings - (44.9) (44.9) - (44.9)
Taxation liabilities - (8.8) (8.8) - (8.8)
---------- ---------- ---------- ---------- ----------
Total liabilities (149.7) (62.5) (212.2) (8.5) (220.7)
The financing of the Group's activities is undertaken at head
office level and consequently net financing costs cannot be
analysed by segment. The unallocated net assets comprise
principally working capital balances held by the support services
function and are not directly attributable to the activities of the
operating segments, together with net corporate borrowings and
taxation.
Geographical information
In presenting geographical information, revenue is based on the
geographical location of customers. Assets are based on the
geographical location of the assets.
Six months ended Six months ended Year ended
30 September 30 September 31 March 2021
2021 2020
-------------------------- -------------------------- --------------------------
Total Total Total
Revenue assets Revenue Assets Revenue assets
GBPm GBPm GBPm GBPm GBPm GBPm
UK 183.5 449.6 143.5 415.6 323.6 423.7
Ireland 5.1 14.2 3.5 13.0 8.7 13.4
---------- ---------- ---------- ---------- ---------- ----------
188.6 463.8 147.0 428.6 332.3 437.1
Revenue and assets relating to discontinued operations were
based in the Middle East.
Revenue by type
Revenue is attributed to the following activities:
Six months Six months
ended ended Year
30 September 30 September ended
2021 2020 31 March 2021
GBPm GBPm GBPm
Hire and related activities 120.5 91.4 206.4
Services 66.1 54.1 121.7
Disposals 2.0 1.5 4.2
---------- ---------- ----------
188.6 147.0 332.3
Major customer
No one customer represents more than 10% of revenue, reported
profit or combined assets of all reporting segments.
5 Financial expense
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
GBPm GBPm GBPm
Total interest on borrowings 1.4 1.5 3.0
Interest on lease liabilities 1.3 1.2 2.4
Other finance costs 0.1 0.1 -
---------- ---------- ----------
2.8 2.8 5.4
6 Taxation
The corporation tax charge for the six months ended 30 September
2021 is based on an estimated full year effective rate of taxation
of 28.2% before exceptional items and amortisation (2020: 20.3%)
and 29.1% (2020: 42.9%) after exceptional items and amortisation.
This has been calculated by reference to the projected charge for
the full year ending 31 March 2022, applying the applicable UK
corporation tax rate of 19% (2020: 19%). Deferred tax is provided
using the tax rates that are expected to apply to the period in
which the liability is settled, based on the tax rates that have
been enacted at the balance sheet date.
During the period, an increase in the tax rate to 25% was
substantively enacted on the 24 May 2021, consequently this has
been used to calculate the deferred tax assets and liabilities and
has resulted in the increased effective rate of taxation. The
impact of the rate change is that the net deferred tax liabilities
have increased by GBP2.0m. Excluding this, the comparative
effective rate of taxation is 21.4% before exceptional
items and amortisation and 22.0% after exceptional items and amortisation.
7 Earnings per share
The calculation of basic earnings per share is based on the
earnings attributable to equity holders of the Company of GBP9.5m
(2020: GBP0.8m) and the weighted average number of 5 pence ordinary
shares in issue and is calculated as follows:
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
Profit (GBPm)
Profit for the period after tax -
basic earnings 9.5 0.8 9.5
Intangible amortisation charge (after
tax) 0.2 0.3 0.6
Exceptional items (after tax) - 3.5 6.7
Profit from discontinued operations
(after tax) (0.2) (1.8) (2.8)
---------- ---------- ----------
Adjusted earnings (after tax) 9.5 2.8 14.0
Weighted average number of shares
in issue (m)
Number of shares at the beginning
of the period 523.8 521.3 521.3
Exercise of share options 0.1 0.3 0.3
Movement in shares owned by the Employee
Benefit Trust 0.1 - 0.8
---------- ---------- ----------
Weighted average for the period -
basic number of shares 524.0 521.6 522.4
Share options 6.7 4.5 6.5
Employee share schemes 1.5 0.3 0.6
---------- ---------- ----------
Weighted average for the period -
diluted number of shares 532.2 526.4 529.5
Earnings per share (pence)
Basic earnings per share 1.81 0.15 1.82
Dilutive shares and options (0.02) - (0.03)
---------- ---------- ----------
Diluted earnings per share 1.79 0.15 1.79
Adjusted earnings per share (from
continuing operations) 1.81 0.53 2.68
Dilutive shares and options (0.02) (0.01) (0.03)
---------- ---------- ----------
Adjusted diluted earnings per share 1.79 0.52 2.65
The total number of shares outstanding at 30 September 2021
amounted to 528,498,631 (2020: 527,008,730), including 4,084,165
(2020: 4,434,814) shares held in the Employee Benefit Trust, which
are excluded in calculating the earnings per share.
8 Dividends
The aggregate amount of dividend comprises:
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
GBPm GBPm GBPm
2021 final dividend (1.40 pence on
522.9m ordinary shares) 7.3 - -
---------- ---------- ----------
7.3 - -
Subsequent to the end of the period, the Directors have declared
a 0.75 pence per share interim dividend payable (2021 interim
dividend: nil pence per share).
9 Non-GAAP performance measures
The Group believes that the measures below provide valuable
additional information for users of the financial statements in
assessing the Group's performance. The Group uses these measures
for planning, budgeting and reporting purposes and for its internal
assessment of the operating performance of the individual divisions
within the Group. The measures on a continuing basis are as
follows.
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
GBPm GBPm GBPm
Operating profit 15.9 1.8 12.5
Add back: amortisation 0.3 0.4 0.8
Add back: exceptional items - 4.1 8.4
---------- ---------- ----------
Adjusted operating profit ('EBITA') 16.2 6.3 21.7
Add back: depreciation 32.9 31.5 63.6
---------- ---------- ----------
EBITDA 49.1 37.8 85.3
Profit/(loss) before tax 14.3 (0.4) 8.3
Add back: amortisation 0.3 0.4 0.8
Add back: exceptional items - 4.1 8.4
---------- ---------- ----------
Adjusted profit before tax 14.6 4.1 17.5
10 Property, plant and equipment
Hire Land and
equipment buildings Other Total
GBPm GBPm GBPm GBPm
Cost
At 1 April 2020 408.1 54.8 83.1 546.0
Foreign exchange (0.6) (0.3) 0.3 (0.6)
Additions 7.2 0.3 1.8 9.3
Disposals (10.4) (0.8) (0.5) (11.7)
Transfers to inventory (3.7) - - (3.7)
---------- ---------- ---------- ----------
At 30 September 2020 400.6 54.0 84.7 539.3
Foreign exchange (0.5) (0.2) 0.3 (0.4)
Additions 28.8 1.4 4.2 34.4
Disposals (35.6) (4.6) (0.7) (40.9)
Transfers to inventory (6.7) - - (6.7)
---------- ---------- ---------- ----------
At 31 March 2021 386.6 50.6 88.5 525.7
Foreign exchange 0.2 0.1 0.3 0.6
Additions 37.6 2.8 3.3 43.7
Disposals (12.1) (1.2) (1.4) (14.7)
Transfers to inventory (5.2) - - (5.2)
---------- ---------- ---------- ----------
At 30 September 2021 407.1 52.3 90.7 550.1
Depreciation
At 1 April 2020 181.0 36.5 70.9 288.4
Foreign exchange (0.3) (0.3) - (0.6)
Charged in period 17.1 1.8 2.6 21.5
Disposals (6.5) (0.3) (0.1) (6.9)
Transfers to inventory (2.7) - - (2.7)
---------- ---------- ---------- ----------
At 30 September 2020 188.6 37.7 73.4 299.7
Foreign exchange (0.3) - - (0.3)
Charged in period 16.6 1.8 3.5 21.9
Disposals (20.9) (2.9) (0.3) (24.1)
Transfers to inventory (4.6) - - (4.6)
---------- ---------- ---------- ----------
At 31 March 2021 179.4 36.6 76.6 292.6
Foreign exchange - - (0.2) (0.2)
Charged in period 17.6 1.8 2.0 21.4
Disposals (6.9) (0.8) (0.7) (8.4)
Transfers to inventory (3.7) - - (3.7)
---------- ---------- ---------- ----------
At 30 September 2021 186.4 37.6 77.7 301.7
Net book value
At 30 September 2021 220.7 14.7 13.0 248.4
At 31 March 2021 207.2 14.0 11.9 233.1
At 30 September 2020 212.0 16.3 11.3 239.6
11 Right of use assets
Land and
buildings Other Total
GBPm GBPm GBPm
Cost
At 1 April 2020 127.8 51.9 179.7
Foreign exchange (0.2) - (0.2)
Additions and remeasurements 2.8 4.8 7.6
Disposals (2.5) (8.5) (11.0)
---------- ---------- ----------
At 30 September 2020 127.9 48.2 176.1
Foreign exchange (0.4) - (0.4)
Additions and remeasurements 10.9 4.1 15.0
Disposals (7.1) (4.1) (11.2)
---------- ---------- ----------
At 31 March 2021 131.3 48.2 179.5
Additions and remeasurements 10.6 9.0 19.6
Disposals (3.3) (6.8) (10.1)
---------- ---------- ----------
At 30 September 2021 138.6 50.4 189.0
Depreciation
At 1 April 2020 80.6 34.4 115.0
Charged in period 6.5 5.7 12.2
Disposals (1.9) (8.1) (10.0)
---------- ---------- ----------
At 30 September 2020 85.2 32.0 117.2
Foreign exchange (0.4) - (0.4)
Charged in period 6.8 5.7 12.5
Disposals (5.0) (3.9) (8.9)
---------- ---------- ----------
At 31 March 2021 86.6 33.8 120.4
Charged in period 5.9 5.6 11.5
Disposals (3.5) (4.6) (8.1)
---------- ---------- ----------
At 30 September 2021 89.0 34.8 123.8
Net book value
At 30 September 2021 49.6 15.6 65.2
At 31 March 2021 44.7 14.4 59.1
At 30 September 2020 42.7 16.2 58.9
12 Borrowings
30 September 30 September 31 March
2021 2020 2021
GBPm GBPm GBPm
Current borrowings
Bank overdraft 1.0 - 0.5
Lease liabilities 19.6 18.5 19.3
---------- ---------- ----------
20.6 18.5 19.8
Non-current borrowings
Maturing between two and five years
- ABF facility 53.4 76.7 44.4
- Lease liabilities 51.3 48.3 46.5
---------- ---------- ----------
104.7 125.0 90.9
Total borrowings 125.3 143.5 110.7
Less: Cash (6.5) (18.9) (11.7)
Exclude lease liabilities (70.9) (66.8) (65.8)
---------- ---------- ----------
Net debt 47.9 57.8 33.2
The Group has a GBP180m asset based finance facility which is
sub divided into:
(a) A secured overdraft facility which secures by cross
guarantees and debentures the bank deposits and overdrafts of the
Company and certain subsidiary companies up to a maximum of
GBP5m.
(b) An asset based finance facility of up to GBP175m, based on
the Group's hire equipment and trade receivables balance. Cash and
facility headroom as at 30 September 2021 was GBP131.0m (31 March
2021: GBP142.3m) based on the Group's eligible hire equipment and
trade receivables.
The facility is for GBP180m, reduced to the extent that any
ancillary facilities are provided, and is repayable in July 2024,
with no prior scheduled repayment requirements. Uncommitted options
exist for a further two one-year extensions until July 2026. An
additional uncommitted accordion of GBP220m remains in place.
Interest on the facility is now calculated by reference to SONIA
(previously LIBOR) applicable to the period drawn, plus a margin of
155 to 255 basis points, depending on leverage and on the
components of the borrowing base. During the period, the effective
margin was 1.72% (2020: 1.84%).
The facility is secured by fixed and floating charges over the
UK and Ireland assets.
13 Contingent liabilities
In the normal course of business, the Company and certain
subsidiaries have given performance bonds issued on behalf of Group
companies, and parental guarantees have been given in support of
the contractual obligations of Group companies on both a joint and
a several basis.
The D irectors do not consider any provision is necessary in
respect of guarantees and bonds.
14 Related party disclosures
There has been no significant change to the nature and size of
related party transactions, including the remuneration provided to
the key management, from that disclosed in the FY2021 Annual
Report.
15 Principal risks and uncertainties
The principal risks and uncertainties which could have a
material impact upon the Group's performance over the remaining six
months of the 2022 financial year have not changed from those set
out on pages 45 to 54 of the Group's 2021 Annual Report, which is
available at www.speedyservices.com . These risks and uncertainties
include, but are not limited to the following:
-- COVID-19 pandemic;
-- Safety, health and environment;
-- Service;
-- Revenue and trading performance;
-- Project and change management;
-- People;
-- Partner and supplier service levels;
-- Operating costs;
-- Cyber security and data integrity;
-- Funding;
-- Economic vulnerability;
-- Business continuity; and
-- Asset holding and integrity.
16 Post balance sheet events
There are no post balance sheet events.
Directors' Responsibilities
We confirm that to the best of our knowledge:
-- the condensed set of financial statements has been prepared
in accordance with IAS 34 Interim Financial Reporting as adopted by
the EU; and
-- the interim management report includes a fair review of the
information required by:
(a) DTR 4.2.7R of the Disclosure Guidance and Transparency
Rules, being an indication of important events that have occurred
during the first six months of the financial year and their impact
on the condensed set of financial statements; and a description of
the principal risks and uncertainties for the remaining six months
of the year; and
(b) DTR 4.2.8R of the Disclosure Guidance and Transparency
Rules, being related party transactions that have taken place in
the first six months of the current financial year and that have
materially affected the financial position or performance of the
entity during that period; and any changes in the related party
transactions described in the last Annual Report that could do
so.
James Bunn
Director
16 November 2021
Independent Review Report to Speedy Hire Plc
Conclusion
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 30 September 2021 which comprises the interim
condensed consolidated statement of comprehensive income, interim
condensed consolidated balance sheet, interim condensed
consolidated cash flow statement, interim condensed consolidated
statement of changes in equity and the related explanatory
notes.
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
September 2021 is not prepared, in all material respects, in
accordance with IAS 34 Interim Financial Reporting as adopted for
use in the UK and the Disclosure Guidance and Transparency Rules
("the DTR") of the UK's Financial Conduct Authority ("the UK
FCA").
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity issued by the Auditing Practices Board for use in the
UK. A review of interim financial information consists of making
enquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review
procedures. We read the other information contained in the
half-yearly financial report and consider whether it contains any
apparent misstatements or material inconsistencies with the
information in the condensed set of financial statements.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the DTR of the UK FCA.
As disclosed in note 1, the latest annual financial statements
of the group were prepared in accordance with International
Financial Reporting Standards adopted pursuant to Regulation (EC)
No 1606/2002 as it applies in the European Union and in accordance
with international accounting standards in conformity with the
requirements of the Companies Act 2006 and the next annual
financial statements will be prepared in accordance with UK-adopted
international accounting standards. The directors are responsible
for preparing the condensed set of financial statements included in
the half-yearly financial report in accordance with IAS 34 as
adopted for use in the UK.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review.
The purpose of our review work and to whom we owe our
responsibilities
This report is made solely to the company in accordance with the
terms of our engagement to assist the company in meeting the
requirements of the DTR of the UK FCA. Our review has been
undertaken so that we might state to the company those matters we
are required to state to it in this report and for no other
purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the company for our
review work, for this report, or for the conclusions we have
reached.
Nick Plumb
for and on behalf of KPMG LLP
Chartered Accountants
1 St Peter's Square
Manchester
M2 3AE
16 November 2021
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END
IR DKABDNBDBCDD
(END) Dow Jones Newswires
November 17, 2021 02:00 ET (07:00 GMT)
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