Northgate plc ("Northgate", the "Company" or the "Group"), the UK and Spain's leading specialist in light commercial vehicle hire, today publishes its Interim Management Statement covering the period 1 May 2011 to 13 September 2011.
Vehicle utilisation in the four months to 31 August 2011 has averaged 90%, with the month of August averaging 91%, a steady improvement from 89% in the month of April 2011. Enhanced information from the new IT system has led to improvements in asset management which, coupled with fewer vehicles on hire, has led to a reduction in the fleet size of 4,700 since 30 April 2011 to 56,500.
Underlying hire revenue per rented vehicle continues to improve, with an increase of over 1% since the beginning of the financial year.
Vehicles on hire have fallen from 53,800 at 30 April 2011 to 51,400 at the end of August, a fall of 2,400 units, in line with the fall noted in the four months to August 2010.
To achieve the improvement in utilisation, vehicles sold in the four months to August 2011 were 2,700 higher than the number sold in the four months to 31 August 2010. Despite the increased volume of disposals the residual values per vehicle remained at a similar level to the previous financial year.
The restructuring of the UK business continues to progress in line with our expectations, improving both operational efficiency and our commercial sales organisation.
In Spain, utilisation rates averaged over 91% in the four months to 31 August 2011, a 1% improvement on the same period last year. The fleet size of 43,500 at 31 August 2011 has remained at the same level as at 30 April 2011 despite an increase in vehicles on hire, which reflects the improvement in utilisation achieved.
Underlying hire revenue per vehicle has remained constant for the four months to 31 August 2011.
Vehicles on hire have increased from 39,400 at 30 April 2011 to 39,800 at the end of August, an increase of 400 units compared to a fall of 1,100 in the four months to August 2010.
The used vehicle market remains stable with residual values per vehicle at a similar level to the second half of the previous financial year.
We continue to make progress on debtor management. The bad debt charge for the four months to 31 August 2011 was €1.1m, a €0.9m improvement compared to €2.0m for the same period last year.
Despite tough economic conditions affecting the UK and Spanish markets, we continue to trade in line with the Board's expectations.
We are maintaining our focus on increasing the Group's return on capital employed through hire rate improvement and increased operating efficiency. We continue to reduce our net debt.
For further information, please contact:
Bob Contreras, Chief Executive
Chris Muir, Group Finance Director
020 3128 8753
Notes to Editors:
Northgate plc rents light commercial vehicles and sells a range of fleet products to businesses via a network of hire companies in the UK, Republic of Ireland and Spain. Their NORFLEX product gives businesses access to a flexible method to obtain as many commercial vehicles as they require.
Further information regarding Northgate plc can be found on the Company's website: