Darlington’s Northgate Plc has reported a £42m jump in turnover after the firm enjoyed increased numbers of vehicle hires.
Revenue at the listed company increased from £701.7m to £745.5m for the year ending April 30.
The growth was attributed to a successful year from its main van hire business, with both hire rates and turnover growing.
Chief executive Kevin Bradshaw said: “We continue to make good progress executing our rental strategy to address the compelling growth opportunity in our markets.
“In the UK, our self-help turnaround programme is delivering. We have successfully introduced regular price increases during the year, and applied greater commercial focus to increase the efficiency of our operations.
“We turned a pricing corner in the second half of the year with our average hire rates returning to year-on-year growth after a three-year period of decline.”
During the 2018/19 financial year, Northgate generated £517.6m from vehicle hires, up from £471.2m during the previous year. Vehicle sales meanwhile dipped slightly from £230.5m to £227.8m.
Northgate was able to convert the increased revenue figures into operating profit, which rose from £64.1m to £75.5m.
The company is also working hard to grow its business in Spain. The company described the Spanish market as competitive but said it had a strong market position.
“In Spain we continue to leverage the strength of our flexible hire business to provide a comprehensive range of fleet hire solutions to our customers,” said Mr Bradshaw.
“We are pursuing minimum-term growth opportunities with increasing selectivity as we take steps to protect the strong and attractive returns of the business against increasing price competition in the market.”
Northgate’s share price stood at 322p per share on Monday. Following yesterday’s announcement the company’s share price jumped to a high of 336.4p before falling to 317.38.
The share price has fallen steadily over the last few years. In July 2018 its share price reached a high of 445p, but even that is much lower than the 656p per share the company achieved in 2015.
Mr Bradshaw said that he did not believe that the company’s share price reflected its true value.
He said: “We are disappointed with the share price performance and remain focussed on addressing the undervaluation of the group.
“The search for our new chairman is well advanced with an exceptionally strong shortlist. The board and management look forward to working alongside a new chair appointment to maximise value for shareholders”.
