Group hits strategic targets, our forecasts rise
The headline news associated with the pre-close H1 update is that strong trading at Crestchic, plus a positive order book, results in an upgrade to our estimates for FY21. Revenues improved by 22% at Group level to £19.6m (the highest level since H1 2014) and by 44% to £15.8m within Crestchic alone.The latter’s progress was led by sales into the data centre market but was widespread across several sectors. The outlook remains similarly impressive, particularly within Crestchic, and as a result we have increased our estimates, with adj. PBT rising to £2.5m (from £2.1m previously).
Crestchic’s performance was underpinned by continued strong growth within the data centre segment, albeit other areas such as grid resilience, renewable energy and oil & gas also performed well - the latter reflecting a project in Asia Pacific during Q1. Europe, the Middle East, and the US all delivered strong progress from Q2 onwards.
We think the stock-market is ignoring the strong trading momentum within Crestchic driving our upgrades. As shown in the note, NBI continues to trade at an undeserved discount to peers: on just a similar rating, the current fair value stands at a conservative 152p / share.
Herc Holdings is an equipment rental supplier. The company conducts its operations through subsidiaries, including Herc Rentals Inc. Operations are conducted under the Herc Rentals brand in the U.S. and Canada and under the Hertz Equipment Rental brand in other international locations. The company sells used equipment and contractor supplies such as construction consumables, tools, small equipment and safety supplies; provides repair, maintenance and equipment management services and safety training to certain of its customers; provides equipment re-rental services and provides on-site support to its customers; and provides ancillary services such as equipment transport, cleaning, refueling and labor.
HSS Hire Group is engaged in providing tool and equipment hire and related services. Co. operates in two business segment; the Rental and related revenue segment comprises the rental income earned from owned tools and equipment, together with related revenue such as resale, transport and other ancillary revenues; and the Services segment comprises Co.'s rehire business (HSS OneCall), HSS Training and TecServ. The HSS OneCall provides customers with a single point of contact for the hire of products that are obtained from approved third party partners; the HSS Training provides customers with specialist safety training; and the TecServ provides customers with maintenance services.
Northbridge Industrial Services is engaged in the sales and hire of industrial equipment on a global basis for use in applications in the oil and gas, shipping, construction, and power and utility sectors. Co. has two main reportable segments: Crestchic loadbanks and transformers, which is involved in the manufacture, hire and sale of loadbanks and transformers; and Tasman oil tools and loadcells, which is involved in the hire and sale of oil tools and loadcells.
United Rentals is an equipment rental company that operates throughout the United States and Canada, and Europe. The company's general rentals segment includes the rental of construction, aerial and industrial equipment, general tools and light equipment, and related services and activities. This segment's customers include construction and industrial companies, manufacturers, utilities, municipalities and homeowners. The company's trench, power and fluid solutions segment includes the rental of construction products and related services. This segment consist of: Trench Safety region, Power and Heating, Ventilating and Air Conditioning region; and Fluid Solutions and Fluid Solutions Europe regions.
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