TIDMHSS
RNS Number : 7666X
HSS Hire Group PLC
29 November 2017
29 November 2017
HSS Hire Group plc
Q3 17 Trading Update
Q3 results for the 13 week period ended 30 September 2017
HSS Hire Group plc ("HSS" or the "Group"), today announces an
update on the performance of the Group for the 13 week period ended
30 September 2017.
In line with its reporting obligations to holders of its Senior
Secure Notes, the Group's wholly owned subsidiary Hero Acquisitions
Limited has today provided an update to noteholders on its
performance for the 39 week period ended 30 September 2017. Details
for the results call for Hero Acquisitions can be found at the end
of this announcement.
Decisive actions return Group to profitability
Trading and Operational Highlights
-- Q3 17 Profits ahead of H1, in line with management expectations
o Underlying rental revenue improved; flat in Q3 17 on
comparable 13 week basis (H1 was -3%)
o Continued strength in Services business with revenue +12% and
contribution +23% vs Q3 16
o Cost saving initiatives fully implemented, on track to deliver
annualised cost savings of GBP13m
-- Operations delivering planned improvements
o Consistently high fulfilment levels and improving
availability
o Asset utilisation in Q3 of 55% in Core and 76% in Specialist
business
o Improved capital efficiency resulting in capex reduction of
GBP4m - GBP6m year on year
-- Net debt GBP8m lower than prior year, headroom in excess of GBP33m
o Net external debt reduced to GBP232.0m at end of Q3 17 (Q3 16:
GBP240.4m)
o Facility and cash headroom in excess of GBP33m (Q3 16 below
GBP15m)
o Completed disposal of non-core cleaning equipment rental and
maintenance business in Q4 17
Financial Highlights Q3 16
- Q3
Q3 17 (13 weeks)
(13 weeks) Restated(3) Change
--------------------- ------------ ------------ ---------
Revenue GBP89.6m GBP89.8m (0.2%)
--------------------- ------------ ------------ ---------
Adjusted EBITDA(1) GBP17.9m GBP20.3m (GBP2.4m)
--------------------- ------------ ------------ ---------
Adjusted EBITA(2) GBP6.6m GBP8.2m (GBP1.6m)
--------------------- ------------ ------------ ---------
Adjusted EBITA
margin 7.4% 9.1% (1.7pp)
--------------------- ------------ ------------ ---------
Current Trading and Outlook
-- October was the fifth successive month of EBITA profit,
albeit marginally behind management expectations
-- Net debt reduction remains key focus and continues to reduce
since end of Q3, with facility and cash headroom now in excess of
GBP35m (October 16 GBP15m)
-- We remain focused on improving Group profitability noting
caution should October's adverse seasonal effects continue for the
remainder of the year
-- Strategic review progressing with update to be provided on the 7 December 2017
Steve Ashmore, Chief Executive Officer of HSS Hire Group plc,
parent company of Hero Acquisitions Limited, said:
"I am pleased to report that the Group has returned to operating
profitability during Q3 17, representing an improvement on our
performance during H1 17. We are delivering to plan through the
execution of decisive sales and cost reduction initiatives that we
have taken over the past few months.
The organisation is now clearly focused on the delivery of
profitable growth, this having been evidenced through our
underlying rental revenues trend improving through the third
quarter.
By continuing to focus on driving down costs, delivering rental
revenue growth and collecting cash more effectively, we will
continue to improve our balance sheet and liquidity position.
Good progress continues to be made with our strategic review and
I look forward to updating the market on 7 December 2017"
Notes:
1) Adjusted EBITDA is defined as operating profit before
depreciation, amortisation, and exceptional items. For this purpose
depreciation includes the net book value of hire stock losses and
write offs, and the net book value of other fixed asset disposals
less the proceeds on those disposals.
2) Adjusted EBITA defined as Adjusted EBITDA less
depreciation
3) Depreciation restated for effect of change in residual values
of rental equipment determined during Q4 2016
Update call for Hero Acquisitions Limited for holders of Senior
Secured Notes
As required by the reporting obligations for the Senior Secured
Notes, a conference call discussing the results of Hero
acquisitions Limited (a wholly owned subsidiary of HSS Hire Group
plc) will be held for noteholders at 2pm GMT today.
To obtain dial-in details for the call, holders should contact
Teneo Blue Rubicon on 020 3757 9248. The accompanying presentation
will be available at
www.hsshiregroup.com/investor-relations/senior-secured-notes/
Ends
Disclaimer:
This announcement contains forward-looking statements relating
to the business, financial performance and results of HSS Hire
Group plc and the industry in which HSS Hire Group plc operates.
These statements may be identified by words such as "expect",
"believe", "estimate", "plan", "target", or "forecast" and similar
expressions, or by their context. These statements are made on the
basis of current knowledge and assumptions and involve risks and
uncertainties. Various factors could cause actual future results,
performance or events to differ materially from those described in
these statements and neither HSS Hire Group plc nor any other
person accepts any responsibility for the accuracy of the opinions
expressed in this presentation or the underlying assumptions. No
obligation is assumed to update any forward-looking statements.
For further information, please contact:
HSS Hire Group plc Tel: (On 29 November 2017)
020 3757 9248
(parent company of Hero Thereafter please email:
Acquisitions Limited) Investors@hss.com
Steve Ashmore, Chief
Executive Officer
Paul Quested, Chief
Financial Officer
Jonathan Edwards, Investor
Relations Manager
Teneo Blue Rubicon Tel: 020 3757 9248
Robert Morgan
Shona Buchanan
Notes to editors
HSS Hire Group plc provides tool and equipment hire and related
services in the UK and Ireland through a nationwide network of over
250 locations. Focusing primarily on the maintain and operate
segments of the market, over 90% of its revenues come from business
customers. HSS is listed on the Main Market of the London Stock
Exchange. For more information please see www.hsshiregroup.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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