By Justin George Varghese
March 7 (Reuters) - Britain’s Ashtead Group Plc stuck by its annual earnings forecast on Tuesday as strong growth in the industrial equipment hire company’s main North American market and a weaker British pound helped it to an 8 percent rise in third-quarter profits.
Underlying pretax profit at constant currency rose to 178.7 million pounds ($218.46 million) for the three months to Jan. 31 from 139.1 million a year earlier.
The company, which hires out diggers and tools on short-term contracts, said rental revenue at constant currency rates rose 14 percent to 729.2 million pounds while the reported figure stood at 804.5 million.
The company has benefited from a rebound in U.S. construction, particularly in the private sector, outperforming peers such as United Rentals Inc, which have more exposure to the struggling oil and gas sector.
Ashtead’s shares have gained 40 percent since the Nov. 8 U.S. elections on hopes that U.S. President-elect Donald Trump will make good on his plan to spend $1 trillion on roads and bridges.
Ashtead said on it expected full-year results to be in line with expectations. It raised its forecast in December, after both its divisions performed at the upper end of expectations and a weaker pound boosted earnings.
Ashtead’s U.S. division, Sunbelt Rentals, reported a 27.2 percent rise in revenue to 2.05 billion pounds.
A-Plant, its UK division which makes up the remainder of its earnings, reported a 14.3 percent rise in revenue to 301.7 million pounds.
The firm expects its full-year capital expenditure to be towards the upper end of its guidance which is about 1.2 billion pounds.
U.S. construction spending unexpectedly fell in January as the biggest drop in public outlays since 2002 offset gains in investment in private projects, pointing to moderate economic growth in the first quarter.
U.S. peer United Rentals Inc also reported better-than-expected fourth-quarter profit and revenue, driven by higher demand for its rental equipment.
$1 = 0.8180 pounds Reporting by Justin George Varghese and Esha Vaish in Bengaluru; editing by Jason Neely