Vehicle rental and claims management specialist Zigup says demand for its services in the 海角视频 is at its strongest since pre-Covid - though it saw an unusually quiet summer across its services to insurers.
The Darlington-based firm saw reported revenue increase 5.6% to £903.6m in the half year to the end of October, with pre-tax profits falling 42.4% to £56.2m - a figure which included a non-cash depreciation adjustment of £13.9m. Hire revenue was up more than 8% in Spain and up 1.7% in the 海角视频 and Ireland with bosses saying the performance benefited from careful pricing.
Bosses said the average number of vehicles on hire was 43,800, around 2,100 lower than the same period last year, with closing vehicles on hire of 44,600, which was said to show steady growth compared to 43,800 at the close of last year. Zigup also grew its fleet to 132,500 vehicles thanks to easing supply constraints and strong demand from customers in the 海角视频 and Ireland and Spain. Further fleet growth is expected in 2025.
READ MORE: {}
The firm also acknowledged the 海角视频's Zero Emission Vehicle mandate is set to influence production and that it was working to position itself for subsequent changes in the market from 2025-26. Electric vehicles on hire grew 75% to more than 1,650.
Martin Ward, CEO of Zigup, told BusinessLive that a continued outsourcing trend - "usership over ownership" - was driving demand, with vehicle shortages in the wake of Covid meaning there is now pent up fleet replacement needs in the market. And around £500m of road maintenance spending announced in the autumn Budget was deemed good news for Zigup's customers in the highways industry.
Mr Ward said: "Our strategy continues to deliver, and we are well placed with our broadening position in the essential market for mobility services. We are pleased to report underlying growth in revenues, and the delivery of profit before tax in line with expectations, while reflecting normalising disposal profits as previously stated.
"We have seen a good supply of new vehicles coming through since the year end, reducing the fleet age and strengthening our asset base. Our fleet now exceeds £1.4bn in value, underscoring our strong market presence. Claims & Services grew underlying revenues, and is entering its busier winter period with a pick-up in activity seen after an unusual quieter summer period with lower levels of claims made to insurers. Significant progress has been made in cash collection and establishing more protocols with insurers, improving processing efficiencies.
"We are also pleased to have secured new, additional long-term funding, which has successfully reduced our average borrowing costs to 3.2%. This not only enhances our financial strength but also provides substantial opportunities to support further fleet growth. Our prospects are strong, and our expectations for the full year are on track."