St.Helens The Heart of the North West

Speedy Hire is bracing itself for the anticipated huge cuts in public spending when the coalition government reveals its spending review in autumn.

However, the Newton-le-Willows- based plant hire group is confident it can prosper from the market upturn as and when it emerges.

The business has diversified in recent years, including by creating joint ventures in the Far East, to spread risk after private sector-driven building projects were hit by the credit crunch.

Now publicly-financed building schemes, such as the Building Schools for the Future programme, will be vulnerable to spending cutbacks.

Chairman David Wallis told shareholders at yesterday’s annual meeting: “The outcome of the UK Government’s autumn spending review and the timing of any recovery within private sector construction will be critical determinants of the future outlook for the business.

“In view of the uncertainty around these areas, we continue to take a cautious view about recovery prospects in the UK for the remainder of this year and next, and continue to position the business accordingly, concentrating on the ‘three C’s’ of cash, costs and capex (capital expenditure).”

But he added: “With an improving trading performance, a clear market leading position in the UK and proven opportunity in branded and advisory and international, we remain confident that the business is well-placed to benefit from the upturn in activity when market recovery takes hold.”

Mr Wallis revealed that revenues, excluding fleet equipment sales, in the three months to June 30 were only 0.7% below the same period last year, which was in line with company expectations.

The UK and Ireland asset services division, which accounts for more than 95% of the group, achieved a gradual year-on-year improvement during the first quarter.

Meanwhile, revenue in June was only slightly behind the same month last year and exceeded £30m for only the second time since July, 2009.

Net debt stood at £134.9m by the end of last week, which was broadly in line with forecasts. The group declared its aim to reduce net debt levels from the current seasonal high over the rest of the year.

Liverpool stockbroker Panmure Gordon welcomed the update saying it confirmed what it had hoped, rather than what the recent share price suggested the market feared.

It said Speedy’s trading was as expected, and the performance to date in line with expectations.

The group also announced the appointment yesterday of Steve McIntyre as its new group marketing director.

He has joined the business after a five-year spell as marketing director for PPG Architectural Coatings.