Profit Falls at Ashtead Group Despite Revenue Gains

Ashtead Group (LON: AHT) reported a mixed performance for the half-year and second quarter ended October 31, 2025. While revenue saw a slight increase, profit figures declined, raising concerns among markets. The company is reaffirming its full-year guidance, signaling confidence despite the headwinds.

Revenue increased modestly, with second-quarter revenue rising 1% to $2,962 million (2024: $2,941 million) and first-half revenue up 1% to $5,763 million (2024: $5,695 million). Rental revenue followed a similar trajectory, increasing 1% in the second quarter and 2% in the first half.

However, adjusted EBITDA decreased by 2% in both the second quarter and first half, settling at $1,381 million and $2,657 million respectively. Operating profit experienced more significant declines, falling 12% in the second quarter and 9% in the first half.

Adjusted profit before taxation saw a 4% dip in both periods, while profit before taxation dropped by 12% and 10% respectively. Correspondingly, adjusted earnings per share edged up 1% in the second quarter but fell 1% in the first half. Earnings per share decreased by 10% and 8% respectively.

Despite the profit decline, Ashtead is actively returning capital to shareholders. The company completed $714 million in share buybacks during the first half, bringing the total under the current program to $1,056 million. Dividends of $307 million were also distributed. A new $1.5 billion share buyback program was announced, set to commence on March 2, 2026, coinciding with the planned relisting on the NYSE. The interim dividend was increased by 4% to 37.5¢ per share.

Driver Breakdown:

• Mega-Projects: Increased activity in mega-projects contributed positively to rental revenue.
• Hurricane Impact: Lower hurricane activity had a negative impact of $55-60 million on rental revenue in the quarter.
• Non-Residential Construction: Moderation in local non-residential construction markets partially offset gains.

Ashtead's chief executive, Brendan Horgan, commented: “The Group reported solid results for both the first half of the year and the second quarter, with revenue, profit, and free cash flow in line with our expectations as we benefit from long-term industry trends and ongoing improvements in our sector.” He further noted the reaffirmation of guidance for rental revenue, capex, and free cash flow for the year.