£45m contract renewal adds momentum to Speedy’s recovery plan

The turnaround of Merseyside-based tools, equipment and plant hire specialist Speedy Hire has been boosted by a three-year contract renewal with construction services firm Carillion worth up to £45m.

The news came in an upbeat trading announcement which indicated the listed Newton-le-Willows company’s recovery is continuing apace with third-quarter revenues 10.6% ahead of the prior year.

Speedy said its plan to improve efficiency of operations remains on track with reduced overheads, and and rental assets and net debt both lower than at half-year end.

The firm announced the acquisition out of administration of the brand, business and assets of Midlands-headquartered Lloyds British Testing in December.

A statement said: “Speedy has implemented a number of customer service initiatives which have led to improving revenue and the retention of major framework contracts.

“These include a contract renewal, and scope extension with Carillion, which in total could be worth up to £45m over three years.

“As a consequence of the improving revenue trend and better operational efficiency, the Board anticipates that adjusted profit before tax for the full year (March 31) will be ahead of its previous expectations.”

In November, Speedy said cost-cutting measures and asset disposals boosted first-half profits by 240% to £6.8m.

The significant increase in profits was on a pre-disposal revenue increase of 5.2% to £171.4m (2015: £162.9m).