Speedy Hire launches probe into £20mn of missing equipment

The UK tools and equipment company Speedy Hire is suffering from not so speedy returns as it launches an investigation into £20mn of missing scaffolding and fencing.

The company said it had discovered the issue while preparing for an end of year audit, which takes place in March.

The missing items could include equipment such as scaffolding towers, fencing and non-mechanical plant items that are not tracked through individual serial numbers, it added on Wednesday.

Last year, Speedy Hire reported a net value of equipment assets of £227mn — meaning about 10 per cent of its stock is unaccounted for. “Non-itemised” items made up about 22 per cent — or £50mn — of the overall equipment value, the company said.

“The board has instigated an external investigation into the issue identified with non-itemised assets, including a review of controls and accounting procedures,” Speedy Hire said in a statement.

Its share price fell about 8 per cent to 39p on Wednesday.

The company added that it had strengthened its accounting procedures for non-itemised equipment, including weekly counts and more scrutiny over purchases and disposals.

Speedy Hire did not comment on how the items went missing.

According to the Chartered Institute of Building, construction site crime is on the rise. A recent survey found that theft was the most common crime across the sector, with 92 per cent of more than 1,000 respondents admitting to experiencing it weekly, monthly or annually. 

However, analysts at Peel Hunt wrote in a note to clients: “We suspect the deficiency [at Speedy Hire] was caused by a combination of overly long depreciation periods (ie assets have been likely scrapped, lost or not returned) and manual processes, rather than a systematic fraud.”

Speedy Hire said it would deliver underlying profit in line with previous expectations and reported increased revenues of 16 per cent in the four months to January, compared with the same period in the previous year.

The company said the missing equipment could affect the value of its non-itemised items as it approaches its end of year audit, but was not likely to hit underlying profits.