Recovery stock Speedy Hire Plc (LON:SDY) had more good news for shareholders this morning with a tripling of full-year profits.
The tools and plant hire firm, which came under attack from a rebel shareholder last year, said it was well-positioned for further growth after a much improved performance in the year to the end of March.
Revenue rose 12.2% to £369.4mln from £329.1mln the year before while adjusted profit before tax soared 224% to £16.2mln from £5.0mln.
Net debt was slashed to £71.4mln from £102.6mln a year earlier, and confidence was such that the full-year dividend was hiked 42.9% to a penny from 0.7p last year.
"These results demonstrate the success of our turnaround plan with significant improvements across all financial and operational performance measures,” claimed Russell Down, chief executive of Speedy Hire.
“Whilst we have made a solid start to the year, the market remains competitive. With the business now stabilised and a strong balance sheet, we are well positioned to take advantage of market opportunities and continue to deliver sustainable profitable growth," he added.
House broker Liberum Capital Markets said the results showed clear evidence of Speedy’s self-help strategy.
“Improved efficiencies along with 6.7% underlying revenue growth have driven a material improvement in both RoCE [return on capital expenditure] and cash returns. Despite this the market continues to under appreciate the upside potential that further self-help measures and the positive long-term industry dynamics provide,” the broker claimed.
Liberum has increased its price target to 62p. The shares currently trade at 55.34p, up 3% on the day and 32% over the last six months.