This year's 'Beast from the East' snowstorm in March may have ratcheted up costs for motor insurers, but at accident management specialist Redde (REDD) it drove demand for vehicle hire services and boosted first-half revenues. Utilisation of the hire fleet also rose to 82.9 per cent from 81.5 per cent last year.
The total number of hire days rose by almost a quarter, driven by an increase in credit hire case volumes of almost a fifth. The average number of vehicles held also grew 14 per cent to meet greater demand. In fact, it was this demand that prompted the group to open an inaugural new car replacement branch in Wrexham in August, with more locations planned.
However, the termination of a claims settlement protocol – a bilateral agreement – with one large insurer meant cases previously handled under that arrangement switched to a non-protocol model, resulting in slower cash realisation. That, along with higher sales, pushed group debtor days up to 105 from 91.
Analysts at N+1 Singer expect adjusted pre-tax profit of £49.2m for the year to June 2019, giving EPS of 13.7p (up from £46.1m and 13.1p in 2018).
| REDDE (REDD) | ||||
| ORD PRICE: | 184.2p | MARKET VALUE: | £559m | |
| TOUCH: | 184-185.2p | 12-MONTH HIGH: | 189p | LOW: 150p |
| DIVIDEND YIELD: | 6.3% | PE RATIO: | 16 | |
| NET ASSET VALUE: | 53p* | NET DEBT: | 5% | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 197 | 10.5 | 6.8 | 6.85 |
| 2015 | 249 | 24.3 | 9.0 | 8.25 |
| 2016 | 379 | 31.3 | 8.7 | 9.65 |
| 2017 | 472 | 31.8 | 8.9 | 10.60 |
| 2018 | 527 | 38.8 | 11.4 | 11.65 |
| % change | +12 | +22 | +27 | +10 |
| Ex-div: | 4 Oct | |||
| Payment: | 8 Nov | |||
| *Includes intangible assets of £102m, or 34p a share | ||||
