Machinery hire firm Ashtead Group said business is booming in the US, off the back of ‘mega projects’ and the government’s green spending bill.

Ashtead revealed strong revenue and profits, with the FTSE 100 firm saying adjusted profit before tax was up by 11 per cent to $615million

The London-based business, which has a major business in the US and hires out machinery like scaffolders, excavators and forklift trucks, revealed that revenue rose by 19 per cent to $2.7billion (around £2.15billion) with rental revenue rising 14 per cent to $2.4billion for the first half to 31 July year-to-year.

But Ashtead cautioned that its UK business was softening.

Brendan Horgan, Ashtead’s chief executive, said: ‘The group delivered another record quarter with revenue up 19 per cent, rental revenue growth of 14 per cent and adjusted profit before tax increasing 11 per cent, both at constant currency. 

‘Our business has clear momentum with robust end markets in North America, which are supported in the US by the increasing number of mega projects and recent legislative acts. 

‘We are in a position of strength, with the operational flexibility and financial capacity to capitalise on the opportunities arising from these market conditions and ongoing structural change. 

‘Despite UK market conditions softening, we expect overall performance to be in line with our expectations and the board looks to the future with confidence.’

Richard Hunter, head of markets at Interactive Investor, said: ‘After a sterling performance at its full-year numbers in June, Ashtead’s impressive momentum has continued with its first quarter numbers outstripping expectations.

‘Group revenue increased by 19 per cent, within which the crucial US unit posted gains of 22 per cent. 

‘Operating profit grew by 18 per cent and pre-tax profit by 11 per cnt alongside further strong investment in the business in an attempt to consolidate the current strength of the trading position. 

‘Some $1.1 billion was spent on the business, with $361 million on nine bolt-on acquisitions, while 40 locations were added in North America.

‘Expansion into North America is clearly paying dividends in both the US and Canada. 

‘The receding risk of recession in the States also feeds into a positive narrative, while the equipment rental space not only continues to grow with revenues up by 14 per cent but the group estimates that there could be much more to play for.

In June, Ashtead achieved another record annual performance on the back of strong demand for its industrial equipment in the US.

The group, saw turnover jump by $1.7billion (£1.4billion), or 24 per cent at constant currency levels, to a record $9.7billion for the 12 months ending April.

Rental-only revenue in the US, where it trades as Sunbelt Rentals, climbed by 23 per cent, with organic sales providing the bulk of growth despite the firm completing dozens of acquisitions during the year.

Hunter added: ‘The business is a cyclical one which brings its own risks, especially in the event of any weakening in demand and the negative response to the numbers echoes the wider market weakness at the open. 

‘Even so, for the moment, Ashtead is making hay while the sun shines and momentum is building. The shares have risen by 26 per cent over the last year, as compared to a gain of 2.3 per cent for the wider FTSE 100, with the market consensus of the shares as a buy fully likely to remain intact following this update.’ 

Ashtead shares are down 2.27 per cent to 5,344p in morning trading on Tuesday. 

Cambridge chip designer Arm will embark on an investor roadshow this week ahead of becoming the most valuable float in New York in two years.

The technology giant plans to ask investors to pay $47 (£37) to $51 per share when it starts to market its IPO and hold meetings with potential investors this week, Reuters reported.

Some big names already signed up as IPO investors in Arm include Apple, Nvidia, Samsung and Google owner Alphabet.

The company was revealed to be targeting a valuation range of $50-55billion in its IPO, although this is below the $64billion quoted by its owner SoftBank in a recent transaction.

This would make Arm the most valuable company to list in New York since the $70billion debut of electric car maker Rivian Automotive in 2021.

SoftBank took Arm private for £24billion in 2016, tearing it away from the London Stock Exchange. SoftBank had hoped to sell Arm to US chip firm Nvidia but a £52billion ($66billion) deal in 2022 collapsed due to regulatory obstacles.

UK ministers then lobbied to SoftBank for a dual listing in London and New York but the City was left empty-handed.

Arm, whose products feature in about 90 per cent of smartphones, has seen an increasing demand for AI chips. The company is gunning for a record float valuation for a UK company when it lists as early as this month.

New York has become popular with tech entrepreneurs. Oxford-based vehicle maker Arrival was given a £10.6billion valuation on the Nasdaq in 2021. 

The world’s largest building materials company CRH also warned it would move its primary stock market listing from London to the US while gambling giant Flutter plans an autumn New York listing.

British life-sciences company Abcam, already listed in New York, was snapped up by US medical giant Danaher in a £4.5billion deal last week.

Daniel Ives, senior equity analyst for Wedbush Securities, said: ‘There are a number of phenomenal technology and life sciences companies in the UK and all are acquisition candidates for bigger US firms.

‘This could be the tip of the iceberg as more UK based tech and life sciences companies get swallowed.’

London’s largest ever float was Glencore’s £38billion valuation in 2011.