Speedy Hire’s board says it enjoyed a better-than-expected few months of trading. This is amid a battle for control of the tool hire business, after it won new contracts and cut overhead costs.
The FTSE Small Cap company, which rents out tools and plant equipment, has been fending off calls by activist investor Toscafund for a boardroom shake-up at a struggling business over alleged corporate governance issues.
Liverpool-based Speedy Hire said on Friday that sales and profits for the six months to September 30 had come in ahead of expectations after a drive to fix the business, including cutting nearly 300 jobs – boostings its forecasts for the year.
“The recovery plan has stabilised the business and continues to drive improved performance,” said Speedy Hire’s board, which led by chairman Jan Astrand, who ended his executive status also on Friday.
Toscafund, which is Speedy Hire’s biggest investor with nearly 20 percent of the company’s shares, has so far failed to oust Mr Astrand and have its own nomination, David Shearer, appointed to the board.
The fund manager, controlled by Martin Hughes, said Mr Astrand’s executive chairman status had breached corporate governance rules.
At a general meeting held earlier in September, just 37 percent of investors voted to remove Mr Astrand, although Toscafund managed to get former Mouchel chairman Mr Shearer into the boardroom with 53 percent backing.
Analysts currently predict Speedy Hire will post a 2 percent rise in sales to £334m in the year to March 31, and turn a £9.9 pre-tax profit from colossal £57.6m losses the previous year.
“We anticipated further progress and the board expects that the full-year profit before tax will be ahead of its previous expectations,” Speedy Hire said.
It comes after a horrible year for the company, which released two profit warnings and lost its chief executive, Mark Rogerson, before postings its huge losses, which were worse than expected.
Chief executive Russel Down said the business had been citing £13m in costs, including shedding nearly 300 jobs, while increasing the efficiency of the back office.
Shares in Speedy Hire, which lost half of its market value since summer 2015, it had a 7 percent boost in morning trading to 36p.