Ashtead Group has reaffirmed its full-year revenue guidance in its Q1 results, after its revenue increased by 2% year-on-year in the three months to 31 July to $2.8bn.

The FTSE 100 industrial equipment rental firm recorded a 7% drop in its operating profit, totalling $683m in this period, which it said reflects a depreciation charge.

Meanwhile, its profit before tax dropped 6% to $512m, following non-recurring costs of $13m associated with the firm’s move to a primary listing in the US and amortisation of $28m.

Ashtead announced its intention to move its primary listing away from London in December, stating that the move would be in "the best interests of the business and its stakeholders", and considers the US market as the "natural long term listing venue" for the company.

The latest results follow a 5% year on-year drop in pre-tax profit in its last full-year results, while its revenue also fell by 1% to $10.79bn in the year to 30 April.

Chief executive officer at Ashtead, Brendan Horgan, said the firm delivered results in line with its expectations as it continues to "take advantage of secular tailwinds and the structural progression" of the industry.

He added: "Rental revenue increased 2.4% as mega project activity gained momentum, and we are seeing positive leading indicators for local non-residential construction activity.

"Our revenue growth combined with strong margins and disciplined capital deployment resulted in near record free cash flow in the quarter. In addition, we were able to complete $330m of share buybacks in the quarter bringing our total to c. $675m under the current programme, as well as paying down $91m of long-term borrowings, with leverage of 1.6x."

Ashtead reaffirmed rental revenue growth from zero up to 4% in the year to 30 April 2026, while its capital expenditure remained the same, ranging rom $1.8bn to $2.2bn.

The firm also increased its free cash flow guidance from between $2bn and $2.3bn to between $2.2bn and $2.5bn. It stated that this increase reflects recent changes in US tax legislation.

Investment director at AJ Bell, Russ Mould, said that "investors could be forgiven for forgetting what a big loss Ashtead would be to the UK stock market" ahead of its US listing move.

He concluded: "Ashtead has one of the best total returns track profiles of any stock on the FTSE 100, having consistently increased its dividend and the first-quarter update represented something of a return to form for the business. The company reiterated full-year guidance off the back of a solid first quarter and, significantly, nudged its free cash flow guidance higher.

"The significant slowdown seen in the final quarter of its last financial year, which the company reported in June, seems to have been arrested for now. Crucially, there seem to be some signs that non-residential construction activity, including on so-called ‘mega projects’ is picking up.

"Current guidance for revenue growth covers a wide range of outcomes from zero to 4% and investors will be expecting this range to narrow as Ashtead moves through the year so they can determine whether it will be a damp squib or a period of meaningful progress."

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