Market report: Speedy Hire's slow revival sees punters start to pile inComments Off on Market report: Speedy Hire's slow revival sees punters start to pile in
Speedy Hire silenced the critics today with bonanza results that caused analysts to tear up their forecasts and investors to pile into the tool hire firm.
Shares in the company soared 5p, or 13.6%, to 41.75p and were back in the black for this year after first-half revenues jumped 13% to £187.1 million and it swung to a £5.4 million pre-tax profit.
The results prompted the company to raise its full-year expectations.
The turnaround has been slow but today Panmure Gordon analyst Adrian Kearsey called it “a massive step in the right direction”.
“These results are likely to (positively) catch the market off guard,” he added.
It flies in the face of criticism from its largest shareholder Toscafund, which has been locked in a fierce battle with Speedy Hire, failing to oust chairman Jan Astrand in September.
However, it had the small victory of adding its own choice of non-executive director to the board.
Toscafund, which has a near-20% stake, argued that Astrand and co were not fit to lead the turnaround, which followed two profit warnings and the departure of its chief executive.
The FTSE 100 was knocked 14.23 points lower to 6778.51 thanks to a fall from the housebuilders on the back of Barratt Developments’ warning of softer demand in London.
Defensive shares were the order of the day, with water firm Severn Trent up 45p to 2184p and publisher Relx rising 15.96p at 1309.96p.
On the mid-cap index, embattled outsourcer Mitie took another dive, down 12.8p, or almost 6%, to 205.5p as investment bank RBC Capital downgraded to underperform ahead of next week’s half-year results.
They follow a shock profit warning in September and news the following month that chief executive Baroness McGregor-Smith is heading for the exit.
“It is only a matter of time before this sector is once again under scrutiny for the wrong reasons,” said RBC, which slashed its forecasts.
Temporary power provider Aggreko tumbled 26.5p to 775.5p as the market questioned whether it would meet its full-year targets after a tough third quarter.
On AIM, Indian online fashion group Koovs, run by Mary Turner, dipped 1.4p to 61.6p after raising £10.9 million as part of its £35 million fundraising drive. The shares were placed at 50p.
Elsewhere, Tiziana Life Sciences was 26p healthier at 201.25p after positive results from animal studies of its treatment for liver disease and diabetes.