Annual Report and Accounts 2012 - Speedy Hire plc

Costs
Speedy has remained focused on tight cost control in order to
maximise return on sales. The sale of the accommodation hire
operation has removed an element of cost where the gross
margin was not sufficient to justify the level of overhead being
incurred. In addition to this step-change in costs, ongoing
programmes aimed at improving efficiency and reducing costs
have been implemented, resulting in reductions in the key
overhead lines of people costs, property costs and vehicle costs.
These programmes include:
> > Super-workshops – Speedy’s first super-workshop was
opened during the year. This facility consolidates a number of
smaller workshops into a single site, resulting in faster
turnaround of hire fleet, improved specialist knowledge of
engineers, more efficient logistics and redistribution of fleet
and lower spares and property costs;
Reduced costs
Improved efficiency
Number of employees
6000
5000
4000
3000
2000
1000
4,692
5,109
4,267
4,124 3,844
0
2008 2009 2010 2011 2012
Customers
Speedy continues to focus on growing revenues with major
customers and with targeting growth sectors, most notably
water, waste, energy and transport. Speedy now has supply
agreements with 72% of the top 25 construction companies in
the UK, almost half of which are at sole/preferred supplier status.
> > Superstores – the roll-out of a further seven superstores
during the year continues the programme of redefining the
depot network. Superstores have lower operating costs and
greater operational efficiency; and
> > Telematics – transport costs are becoming a larger proportion
of the cost base as fuel prices continue to increase. During the
year, a telematics system has been introduced to monitor
vehicle performance in order to provide management
information to support efficiency improvements.
Tight cost control over the controllable overheads has allowed
Speedy to mitigate the effect of inflationary pressures,
specifically in people costs, property costs and fuel costs.
Identified opportunities
Innovative products and services
Number of vehicles
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2,891
2,543
2,221
2,055
1,919
2008 2009 2010 2011 2012
Business review 15
This year we have secured a three-year contract extension with
Carillion as a strategic supplier and a five-year renewal with
Morgan Sindall as a strategic supplier, and have strengthened
existing relationships with key clients and contractors such as:
Exxon, Thames Water, Welsh Water, Balfour Beatty, AMEC, BAM
and Galliford Try.
Speedy Hire Plc Annual Report and Accounts 2012
Business review