Ashtead Group PLC Q2 2026 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Lushanthan Mahendrarajah - JPMorgan Chase & Co - Analyst : Morning, guys. Thanks for taking my questions. I have got two. The first is just on rental rates and how we think about the combination of that and margin as we go through the second half. And some of those things are like mix related, et cetera, and repositioning related. I mean is that something that you want to start to offset and push rental rates a bit more? Or are you happy with the status quo and those things or themselves out over time? So that's the first question. And the second is just on local and you indicated, I think there on the document and the 12- to 24-month lead time. Also interesting to hear, I think you said quotations and reservations yourselves is pending awards. I mean, is it difficult to see a lead time of 12, 24 months for those as well? I'd imagine those are shorter, just to get an idea of exactly what you're seeing there and what that actually means to labeling into revenue?

Question: Annelies Vermeulen - Morgan Stanley - Analyst : Hi. Good morning, Brendan. Morning, Alex. Two questions, please. So just on the UK restructuring charges. So you've mentioned closing branches and some headcount. So do you expect that that business will be materially smaller going forward? And if you could talk a little bit about what has prompted that? And as part of that, you mentioned double-digit returns on those investments. So over what timeframe could we see that come through? And then secondly, just coming back to some of those green shoots on leading indicators. Is there anything incrementally different relative to the last time we spoke in September with regards to the type of customers or projects that you're seeing that across? Or any particular drivers you're hearing in your conversations with customers such as rates, et cetera? Any color there?

Question: Neil Tyler - Redburn Partners LLP - Analyst : Good morning, Brendan, Alex. Two for me, please. You've increased the amount of M&A slightly. You mentioned a robust pipeline. Does this reflect a more attractive M&A landscape more broadly? Is that maybe tying into your comments about some of the industry being a little bit over fleeted? Are there assets available that have got increased headroom to improve utilization compared to, say, a year or two back? That's the first question. And then similar topic, but on your own fleet utilization, how are you thinking about utilization rates as you shape up for the 2026 season? How much growth headroom in terms of utilization rates do you think exists in your current fleet before CapEx will need to raise to move the fleet in lockstep with demand growth, if that makes sense?

Question: Arnaud Lehmann - Bofa Merrill Lynch Asset Holdings Inc - Analyst : Thank you very much. Good morning, gentlemen. Two questions from my side. Firstly, on margin trends, you highlighted, again, a little bit of margin erosion year-on-year, highlighting the repairs and repositioning of the rental fleet. Do you expect that to continue into the second half of the fiscal year? Or the repositioning is largely done, maybe something remain on the repair side? My second question is just a few follow-ups on the US relisting. Are you -- when are you expecting to transition to US GAAP? Are you going to move to a December year-end for reporting? And what incremental IS relisting costs should we expect into Q3 and Q4, please?

Question: Rob Wertheimer - Melius Research LLC - Analyst : Hi. Thank you. A question on just profitability and ROIC on the mega projects versus the rest. We've seen the fleet positioning costs. I wonder -- I'm not sure if I understood the last answer to indicate that the repositioning is phase or on low whether it continues with each mega project as they bounce around the country, whether that's just a new cost of doing business. But does the profitability curve up to average? Or is it lower given competition? And -- well, anyway, I'll stop there for now.

Question: Rob Wertheimer - Melius Research LLC - Analyst : Perfect. That was it. Thank you. And then just out of curiosity, I guess, just as you've slowed expansion appropriately with the industry, then the repair cost comes up as more of the free to warranty I get that. Is that a one-year effect and you rebase? Or if you didn't expand faster again, would that continue to be a margin headwind over the next year? I'll stop there.

Question: Suhasini Varanasi - Goldman Sachs Group Inc - Analyst : Hi. Good morning. Just one final follow-up from me, please. The UK restructuring program of $37 million. I mentioned it was cash bond, but can you maybe give us some color on what's the benefit on annualized SG&A costs for that region, and therefore, the benefit to margins on an annualized basis?

Question: Allen Wells - Jefferies LLC - Analyst : Hey. Good morning, Brendan. Good morning, Alex. A couple from me, please. Firstly, just on the margins. Sequentially, slightly worse, I think, down $140 million versus $120 million in Q1. The incremental decline there, is that all related to hurricane activity? Or were any of the other headwinds stronger in the quarter? And maybe linked to that, I think kind of follows on from Rob's question on the repair costs. We should expect that obviously to be a continued headwind over the next few quarters. But when you look at that CapEx profile, the step-up between '22 and 2024, should we be thinking that the headwind from higher repair cost actually steps up over the next few quarters as well, so that's just those on the margin? And then secondly, just on the rate environment following on from a question earlier. Beyond the broader market conditions being slightly muted, are there any other factors that you would call out that are impacting rates? I'm particularly thinking about are there any particular smaller or mid-sized competitors as being a bit more aggressive than you would typically expect on pricing or anything like that? Or is it just a broader market issue?

Question: Allen Wells - Jefferies LLC - Analyst : Thank you. And sorry, just a quick clarification, Alex. I appreciate you confirmed that there's be a sustained headwind in the higher repair cost. But I guess my question was, when I look at the CapEx profile, '23 was more CapEx in '22, '24 was more than '23. So is there any reason why that headwind shouldn't actually increase given that CapEx profile? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 09, 2025 / 10:30AM, AHT.L - Q2 2026 Ashtead Group PLC Earnings Call

Question: Karl Green - RBC Capital Markets Inc - Analyst : Yeah. Thanks very much. Good morning to you. Just two questions. The first one, Brendan, given that we're seeing double-digit auction inventory builds in major equipment categories, I just wondered what gives you the confidence in the statement of the over fleeting in the industry has been largely corrected? And then the second question, Alex, perhaps for you, just on depreciation. It looks like sequentially, adjusted depreciation went down between Q1 and Q2. So I just wanted to understand the moving parts of that. Was that partly due to accelerated write-offs in the UK? Was LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 09, 2025 / 10:30AM, AHT.L - Q2 2026 Ashtead Group PLC Earnings Call there anything else going on there in terms of fleet mix that we should be aware of? And then just a final follow-up on that would be, what would your expectation be for full-year depreciation, please?

Question: Karl Green - RBC Capital Markets Inc - Analyst : That's helpful. Thank you.

Question: Neil Tyler - Redburn Partners LLP - Analyst : Yeah. Hi again. Just wanted to follow up actually on the answer to the previous question about the used equipment recovery rates. You said for some time that you have been trying to optimize the channels that you use. Can you give us any update on that, your thoughts on the current split? And how far through that optimization process you are? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 09, 2025 / 10:30AM, AHT.L - Q2 2026 Ashtead Group PLC Earnings Call

Question: Neil Tyler - Redburn Partners LLP - Analyst : Thank you. That's very helpful. That's exactly what I was after.