Investors in HSS Hire can look forward to a higher dividend payout this year despite adjusted profit nearly halving on challenging macroeconomic conditions.
The tool and equipment hire firm is has recommended a final dividend full-year of 0.56p, an increase of four per cent.
However, the company’s profit dropped to £11.9m, down from £21m. Pre-tax profit also fell £7.1m to £11.8m, although the figure marked the second highest in the company’s listed history.
Steve Ashmore, Chief Executive Officer, said: “I am pleased to report another year of significant strategic progress alongside resilient financial performance, delivering revenue growth ahead of the market despite a more challenging macro-environment.
“We have made big strides implementing clear focussed strategies for our two divisions ProService and Operations, with early positive results providing the confidence to accelerate strategic investment to evolve HSS into a leading marketplace for equipment services.
“Customers are engaging with our marketplace platform at an exponential rate, valuing the ease it brings and resulting in significant revenue growth.”
Outlook for the year ahead remained unchanged, with management confident full year earnings before interest, taxation and amortisation (EBITA) will be in line with market forecasts.
The AIM-listed group, which floated in 2015, has been hit by soaring inflation and cautioned it was still looking to manage costs amid ongoing macroeconomic uncertainty.
Capex investment forecast in 2024 is expected to be between £26m to £29m, including around £3m to support the Group’s marketplace strategy, HSS Hires said in a statement to markets.
The group’s marketplace growth strategy includes expanding its self-service platform. Some 1,000 customers have transacted using the service, with 30 per cent average revenue growth.
It has also expanded its low-cost builder’s merchant network, with the number of locations increasing from 63 to 89. Further growth plans are underway, with 10 new locations expected to open in the first half of 2024.
“We are more confident than ever in our strategy and the strength of our technology platforms. We are well placed to take full advantage when the market recovers,” Ashmore said.
