Ashtead Group plc

Solid Revenue Growth: Ashtead Group reported Q3 results with U.S. rental revenues increasing by 4% year-on-year, while group rental revenues were up 5%. Group EBITDA grew by 3% to $3.9 billion, reflecting strong operational performance despite a planned decline in used equipment sales, which kept total revenues flat.

Strong Free Cash Flow and Return on Capital: The company generated free cash flow of $858 million in the first nine months of the fiscal year. The return on investment (ROI) stood at a strong 20%, and the management reaffirmed their focus on maintaining capital efficiency while dynamically reallocating capital to growth areas despite some transitory market softness.

Challenges in Local Non-residential Construction: The local commercial construction market is experiencing softness due to prolonged higher interest rates affecting smaller regional developers. Although there is a downside in the local segment, the management remains optimistic about recovery and believes it will provide future growth opportunities.