Speedy Hire losses increase to £14m
Published: 18 November, 2010
MERSEYSIDE: Plant hire specialist Speedy Hire made a £13.8m loss in the first half of its financial year, covering the six months to 30 September.
Bad debts continued to hit the company, which lost £13.6m in the same period last year.
Its exposure to Connaught resulted in a loss of £1.7m, as its debts were unrecoverable.
Revenue was down 4.1% to £177.3m in the first half, compared to £184.8m a year earlier.
After adjusting for exceptional costs and the write down in the value of companies it has acquired in the past, losses still more than doubled from £4.8m last year to £9.9m this financial year.
In an attempt to reduce risk and target large contractors, which have generally proved more stable and less likely to go bust than smaller firms, Speedy sourced 27% of its revenue from the biggest 50 construction firms in the first half. This is a small increase from 25.9% last year.
Chairman David Wallis said: "UK revenues, average hire rates and volume trends are now showing progressive improvement. Although market conditions remain challenging, with our strong balance sheet, market leading position and closer alignment with growth markets, the business continues to be well placed both to benefit from the actions taken to reduce operating costs and to capitalise on market recovery.
Net debt increased on last year as spending on its fleet offset positive cash generation from the business. At the end of September, debts totalled £123m.
Speedy experienced a more positive trading environment as the year progressed, with three consecutive quarters of growth.