Speedy Hire reports first half drop

A challenging start to the financial year at UK-based rental company Speedy Hire has led to job cuts and operational changes.

The company reported six-month revenues of £165 million (€232 million), down from £189 million (€266 million) for the same period in 2014. Earnings before interest, taxes and amortisation stood at £4.5 million (€6.3 million), compared to £13.8 million (€19.4 million) a year ago.

It has been another tumultuous year for Speedy Hire, which announced in February that it was withdrawing from general hire in the Middle East following accounting regularities which led to a full-year loss for 2013.

Then in July, chief executive Mark Rogerson stood down after 18 months in the job. Jan Åstrand was appointed executive chairman.

The company said that when it became apparent that it was experiencing a significant decline in 2015 revenues, it initiated a number of remedial actions including reducing the UK and Ireland headcount since the year-end by 298 to 3167.

Speedy said it expected reductions in administrative costs to deliver full year savings of around £13 million (€18.3 million) compared to 2014. It said it was also redistributing its assets across its depot network to improve availability, and upgrading its IT system.

The company said it was focussing on a leaner, more effective operational structure and administrative cost base to more closely align costs with revenues.

‘Disappointing’

Chief executive Russell Down said, “Following a disappointing and challenging start to the year, reflected in the results we are announcing today, we are beginning to see the benefits of the remedial actions put in place to address the various legacy issues.

“These are early days in the group's recovery and the full benefits will only be realised over the medium term. However, remedial actions implemented to date have started to stabilise our revenue base and we are expecting to see an improvement in the second half.

“Whilst our markets remain competitive, Speedy remains a fundamentally good business which in a more lean, efficient and customer-focussed form, has the potential to once again deliver sustainable profitable growth."