Hirepool chief executive Brian Stephen is a small shareholder in the business, which is majority-owned by private equity firm Next Capital. Photo / File
Hirepool chief executive Brian Stephen is a small shareholder in the business, which is majority-owned by private equity firm Next Capital. Photo / File
Owners of equipment rental firm Hirepool have had a long-awaited payday with the company forking out dividends totalling $70.46 million in July.
The dividend is the first for many years after the Auckland-based company underwent restructuring following a failed attempt to float its shares on the NZX in 2014.
Hirepool,62.9 per cent owned by Australian private equity firm Next Capital, revealed the dividend in its latest financial statements as a subsequent event with the payout occurring just after the June 30 balance date.
The statements also showed Hirepool has renewed its senior debt facilities with existing lenders Westpac, Aware Super, ASB and Kiwibank with a new expiry date of June 30, 2026.
The new facility now totals $179m, up from $125m as at June 2022 and comes with an average interest rate of 6.34 per cent.
The company also amended its mezzanine debt facility with an increase to $60.6m from $46.8m with an expiry date of December 29, 2026, and an average interest rate of 14.2 per cent.
In recent years Hirepool has issued share options to key management as part of an incentive scheme linked to a shareholder exit event.
In 2021 changes were made to include a new vesting condition based on debt refinancing.
The group accounts show eligible management were paid a combined total of $4.09m on July 7 in lieu of share option cancellation consideration payments.
Hirepool is New Zealand’s biggest equipment rental firm having operated for more than 60 years. The company has 70 branches nationwide with more than 30,000 products available for hire ranging from landscaping and earthmoving equipment to trade tools and machinery. It also supplies vehicle rental, continental events and portaloo hire.
For the year to June 30, Hirepool generated hire revenue of $179.03m, up from $157.56m in the 2022 financial year.
After-tax profit fell to $13.56m from $18.67m due to increasing costs, including interest rate expenses. Retained earnings at balance date and prior to the dividend being paid out on July 7 were $90.46m.
Hirepool previously received $4.255m in Government wage subsidies to cover payments to 613 staff during Covid lockdowns and also was granted rental concessions from landlords during the level 4 lockdown in 2020.
Hirepool has more than 70 branches nationwide. Photo / NZME
The company has been largely profitable since 2014 when Next Capital tried to sell the business in a $262m initial public offering but had to call that off when institutional investors pushed back against the sale price.
At the time Next owned 64 per cent and Macquarie Group had 21 per cent. Former Tauranga Mayor Tenby Powell and his wife, Sharon Hunter, also had a shareholding having previously owned the business.
Macquarie and Powell/Hunter are no longer listed as shareholders in Hirepool. Ireland-based Penguin Issuer Designated Activity Company Ltd became a 16.77 per cent shareholder in August 2017, according to Companies Office records.
