Ashtead Group plans to increase the footprint of its North American business – Sunbelt Rentals – by about 50 percent within the next three years, according to a plan being discussed with investors on April 20 in New York City.
The company has been eying the opportunity to add roughly 250 more Sunbelt Rentals locations, according to Ashstead website.
With Sunbelt Rentals the focus of the meeting, an update on the group’s five year “Project 2021” was to cover the group’s strategy for achieving that expansion.
“We will also focus on the breadth of our end markets beyond the construction sector and how Sunbelt’s technology continues to be a key differentiator for us in the North American market,” says a statement issued about the two-day investor event.
The presentation also includes an update on current trading.
“The group has continued to perform well in the fourth quarter of the current financial year, and we expect full-year results to be in line with our expectations,” the statement says.
Third-quarter growth had shown a 21-percent gain in rental revenue.
Hosting the event: Geoff Drabble, CEO; Brendan Horgan, CEO of Sunbelt and chief operating office of Ashtead Group; and Michael Pratt, finance director, along with others on the Sunbelt senior management team.
The presentation at 10 a.m. Eastern Time, was being broadcast live via the company’s website at ashtead-group.com. A replay is available on the website.
Pride Equipment acquisition featured
The two-day investor event also included a tour of a Sunbelt location on Long Island. This aerial work platform location, acquired with the Pride acquisition, services the New York City market and surrounding areas, the company says.
In March 2017, Ashstead bought Pride Equipment Corporation in New York to enhance presence in the New York City market and accelerate a couple of planned greenfields and growth capital expenditure.
Further diversifying the business has been a priority and opportunities allowing the group to diversify further and expand its specialty businesses are seen as particularly key in building a broader base for growth.
The Pride Equipment visit shows “how bolt-on acquisitions are an integral part of the overall growth plan for the business,” the Ashstead statement says.
Global growth in rental industry
Analysts forecast that the global equipment rental market will grow at a CAGR of 3.2 percent during the period 2017-2021. That’s according to The “Global Equipment Rental Market 2017-2021” by ResearchAndMarkets.com.
Sunbelt Rentals is a key vendor along with Atlas Copco, Caterpillar, Hertz Equipment Rental and United Rentals, according to the report.. Herc Rentals is among other business reported surging increases in revenues.
Ashstead’s ‘enormous impact’ on U.S. market
Ashstead has said that it’s made an “enormous impact on the U.S. market since 2012,” adding more than 250 new locations between 2012 and 2017.
“It is only a matter of time before we achieve similar results across a broader geography because we now have the scale, competitive advantage and balance sheet strength to reach our targets,” the company’s website says in explaining its platform for growth.
“We believe there is significant opportunity for expansion in both existing and new geographies with the ability to add around a further 250 locations.”