Ashtead Group PLC (LSE:AHT) has warned sales and profit for the current financial year will be below current market expectations after a quieter hurricane season and the writers’ and actors’ strikes persisting longer than expected.
The international equipment rental company now expects both group and US rental revenue growth in the range of 11% to 13% (previous guidance for both: 13% to 16%), which will result in EBITDA being 2% to 3% below current market expectations.
In addition, it expects a full-year depreciation charge of around US$2.12 billion and a net interest cost of US$540 million, which will result in adjusted profit before tax being below current market expectations.
Capital expenditure guidance remains unchanged at US$3.9 billion to US$4.3 billion, it said.
Ashtead still expects to report record results for the first half and the second quarter to 31 October 2023, with group rental revenue growth for the half year of 13%, EBITDA growth of 15% to around US$2.58 billion and adjusted pre-tax profit growth of 5% to around US$1.31 billion.
The firm said revenue late in the second quarter was affected by lower levels of emergency response activity with a significantly quieter hurricane season than seen in recent years and fewer naturally occurring events, such as wildfires, with this effect continuing into the third quarter.
In addition, the well-covered writers' and actors' strikes, which have hit the company's Film & TV business in Canada significantly, persisted for longer than anticipated with some impact on the rest of the Canadian, US and UK businesses that rent into that space.
This has also continued into third quarter, it said.