Ashtead Q1 Profit Narrows, Firm on Track for NYSE Relisting

Ashtead Group (LON:AHT), the equipment rental company, saw its shares rise on Wednesday morning despite reporting a slight dip in first-quarter profit for the period ended July 31, 2025.

While revenue saw modest growth, profitability metrics experienced minor contractions. The company reaffirmed its full-year revenue and capital expenditure guidance, while increasing its free cash flow forecast and progressing toward its planned NYSE relisting in March 2026.

Revenue climbed 2% to $2.801 billion, driven by a similar increase in rental revenue to $2.601 billion. However, adjusted EBITDA edged down 1% to $1.276 billion, and operating profit decreased 7% to $642 million.

Adjusted profit before taxation fell 4% to $552 million, translating to adjusted earnings per share of 95.3¢, a 2% decrease from the prior year's 97.4¢.

Despite the profit decline, Ashtead demonstrated strong cash flow generation. Free cash flow jumped to $514 million, a significant rise from $161 million in the same quarter last year.

The robust cash flow enabled the company to execute $330 million in share buybacks and reduce long-term borrowings by $91 million, further lowering its net debt to adjusted EBITDA leverage to 1.6 times from 1.7 times.

The increase in free cash flow can be attributed to disciplined capital deployment, with $532 million invested in the business compared to $855 million in the prior year.

Ashtead shares hit a high of 5,550p at the open on Wednesday. However, the stock has since pulled back, currently around the 5,394p mark, up approximately 0.3%.

Ashtead's chief executive, Brendan Horgan, commented, “The Group delivered solid first quarter results with revenues, profits and free cash flow in line with our expectations as we continue to take advantage of secular tailwinds and the structural progression of our industry.”

He also highlighted the company's safety-first culture and Engage for Life program.

Looking ahead, the company forecasts rental revenue growth between 0% and 4% in 2025/26, with capital expenditure between $1.8 billion and $2.2 billion, unchanged from the previous guidance. However, free cash flow is now expected to be between $2.2 billion and $2.5 billion, up from the previously forecasted range of $2 billion to $2.3 billion.