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UPDATE 2-Ashtead refocuses equipment hire as construction slump hits

* To further diversify away from construction sector

* Ashtead to build up its specialty businesses

* Q1 profit plunges 35%; rental revenue down 8%

* Shares up 2% at 2,745 pence at 1037 GMT (Adds CEO comment, background)

Sept 8 (Reuters) - Ashtead, which operates mainly in the United States, Canada and Britain under the Sunbelt Rentals brand, said it would diversify from building equipment on Tuesday as coronavirus restrictions hit first-quarter profit.

FTSE 100-listed Ashtead gets around 90% of its sales and profit from the U.S. market, where construction spending had fallen to a year low in June, although July saw some recovery in the private sector.

Chief Executive Brendan Horgan told Reuters that Ashtead expects full-year group rental revenue to be in the mid to high single digits lower when compared with last year on a constant currency basis if there are no significant further shutdowns.

Ashtead, which rents out diggers, construction tools and other equipment, is planning 25 to 30 greenfield projects in the year, with 75% of those in its speciality businesses.

“We have a number of relatively new specialist businesses including lawn improvement, pumping, climate control and ground protection,” Horgan said.

Ashtead’s shares were up 2% at 2,745 pence at 1037 GMT after it said underlying pretax profit fell 35% to 208 million pounds ($274 million) in the three months ended July 31, while rental revenue declined 8% to 1.08 billion pounds.

Despite the falls, Jefferies analysts said in a note that Ashtead’s U.S. general tool and speciality businesses have seen continual underlying improvements. ($1 = 0.7600 pounds) (Reporting by Aby Jose Koilparambil in Bengaluru, Editing by Sherry Jacob-Phillips, Amy Caren Daniel and Alexander Smith)

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