HSS Hire enjoys strong first quarter despite rising investment costs

27th May 2015 11:01

HSS Hire reported a strong first quarter despite an increase in investment costs affecting its core business.The supplier of tool and equipment hire said the results were in line with expectations with good volume growth in its core and specialist business.Revenues in its core business rose 12.4% to £62.7m while revenues in the specilist division were up 36.1% to £9.8m.However, adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) performance in its core business fell 6.4% to £10.2m due to investment costs in new local branches, investment in its HSS Way initiative and further operating costs.On the bright side, EBITDA in the specialist division jumped 67.7% to £5.2m.Chief executive Chris Davies said: "This performance leads us to believe that we are successfully taking market share from our competitors, both local and national."In addition to customer demand-led investment in our hire fleet, we have continued to invest in our platforms for growth; opening new local branches, recruiting and training new sales colleagues, developing larger account relationships and growing specialist businesses that enhance our ability to serve our customer base."Looking forward, the company said trading in the second quarter is ahead of the same period last year.Numis analysts noted that the first four months of the year are the "quietest trading quarter", but added that the results "demonstrate strong revenue growth and ongoing investment in the business".Shares were down 2.63% to 204p at 11:00.