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Mon June 21 2021

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Speedy rebounds in the second half

25 May Plant and tool hire chain Speedy has posted annual results ahead of expectations, representing a solid come-back from the initial impact of the Covid-19 pandemic.

Speedy ended the year to 31st March 2021 with revenues back at pre-Covid levels and has started the current year ahead of 2019.

Revenue for the year (excluding disposals) was down 11% to £359.4m (2020: £402.5m), while pre-tax profit was down 41% to £12.3m (2020: £20.7m).

However, operating profit was up 21% to £17.0m (2020: £14.0m) and net debt was reduced during the year from £79.3m to £33.2m.

After a tricky start to the year with the first national lockdown – revenue fell 35% in April 2020 – Speedy recovered progressively, with hire revenue up 4% on a like for like basis in the fourth quarter. Utilisation improved in the second half to 58.8% (2020: 55.9%).

Speedy initially closed two-thirds of its network in April 2020 but by September the network was operating at full capacity again following a review of the depot footprint.  This resulted in the permanent closure of 13 depots and the consolidation of a further 22 depots into larger service centres. Approximately 200 staff were laid off. As a result, there were £5.6m of exceptional property related costs and £1.9m of redundancy costs incurred during the year.

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Total headcount at 31st March 2021 was 3,843, down from 4,065 at the start of the financial year. In the UK and Ireland, headcount has reduced from 3,464 to 3,303.

On 1st March 2021 Speedy sold its Middle East business to its principal customer Adnoc, the Abu Dhabi National Oil Company, for US$18m.  The transaction resulted in a gain on disposal of £800,000 for Speedy.

Chief executive Russell Down said: "I am pleased to report results that are ahead of our expectations in what has been an exceptionally challenging year for customers and colleagues alike.  The resilient performance of our business during this unprecedented period is testament to the strength of our model, hard work of all my colleagues and strong operational delivery.  Our excellent customer service, including our four-hour delivery commitment, has facilitated a strong recovery in the second half.

"We have had an encouraging start to FY2022 with revenue in April and May c.2% ahead of the equivalent period in 2019.  Our strong balance sheet and the actions we have taken to develop our digital and ESG [environmental, social and corporate governance] offerings give us confidence for the future."

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