Speedy Hire says revenue picking up as construction activity begins again
Construction equipment rental firm Speedy Hire said that revenue in April was ahead of expectations, but still 35 per cent down on last year due to the coronavirus pandemic.
The firm said that the easing of lockdown measures throughout May had seen construction activity pick up, meaning that last week tool hire revenue was only 17 per cent down on the same period in 2019.
In a trading update, Speedy Hire said that it had also reduced the number of its staff on furlough from 50 per cent to 33 per cent – roughly 1,200 employees.
The company also said it had reduced its net debt from £80m to £68m due to strong cash collection during the lockdown period, with maximum committed facilities of £180m.
In a separate announcement, the firm also announced that finance chief Chris Morgan would step down at the end of July by mutual agreement.
Speedy Hire’s board has begun the search for a replacement, it added.
Back in April the FTSE 250 firm had taken drastic measures to bolster its finances as the pandemic forced the closure of construction sites across the country.
Along with making use of the government’s job retention scheme, Speedy Hire cut pay for its executive team by 20 per cent for three months and said it had deferred its April salary review and instituted a hiring freeze.
The firm also said it would push back the publication of its annual results until 23 June due to difficulties with its training subsidiary Geason.
Geason has not performed in line with management’s expectations and as a consequence the carrying value of goodwill and any contingent consideration payable will be written down to nil in the year end accounts, Speedy Hire said.
In addition, Geason received a claim from a funding agency in late April 2020 alleging poor financial controls and overpayments of up to £2.6m for the three year period commencing August 2017, which the firm is investigating.