Speedy Hire shares soar as tool lender hammers expectations – “in spite” of Toscafund activism
Speedy Hire’s share price shot up 15 per cent this morning after the lender of tools and construction equipment reported increasing revenues and profits – an improvement the company said came “in spite” of a high-profile attack from an activist investor.
Group revenue for the six months to 30 September was £187.1m, up 13 per cent from £165m in the same period last year. Pre-tax profit, meanwhile, came in at £6.8m, up from £2m.
Shares were up more than 15 per cent to 42.5p, their highest level since January, this morning, and analysts also appeared to be impressed. Liberum said the profit-before-tax figure was 31 per cent ahead of expectations, while N+1 Singer upgraded its forecast for the firm.
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Read more: Speedy Hire chairman Jan Astrand survives Toscafund ousting attempt
The latter part of the six-month period saw Speedy Hire come under public attack from activist investor Toscafund, which forced shareholder votes on the suitability of Speedy’s chairman and the appointment of a new board member. Investors voted to let Jan Astrand, who is now non-executive chairman, remain, but agreed that David Shearer should be appointed to the board.
Russell Down, who started as chief executive of Speedy in July last year, told City PM the company’s improvements this year came “in spite” of Toscafund.
“I think all the changes that you see today were put in place a year ago,” he said. “We said at the start of the process with Tosca that the recovery was well underway, and that [the Toscafund intervention] really only happened in August.
Read more: Ding, ding: Round 1,182 of Toscafund v Speedy smackdown ahead of meeting
“And almost these results are in spite of what happened with Tosca, rather than because of what happened with Tosca. Because it was a distraction for the business during that particular point in time.”
He added: “I wouldn’t say it was hugely disruptive, but clearly we’ve got 3,000 employees in the UK who are reading about what’s happening in the press. And it did take a lot of my time to manage that.”
Down said the company has not experienced any ill effects from the UK’s Brexit vote and feels that with infrastructure projects like HS2 and Crossrail 2 coming up, there will be more opportunities for growth.