This year the company plans to open three new primary sites and six new branches. Northgate chairman Michael Waring said the company had converted more customers to Norflex, its flexible hire product, and achieved a fleet utilisation rate of close to 90%.
He added that hire rates had remained relatively unchanged, despite competitive pressures, and said 'the gradual extension of the average vehicle replacement period and improved selling and management techniques introduced within our used vehicle operations have had the expected effect of reducing losses on the sale of used vehicles'.
New accounting standard FRS15 has forced Northgate to spread volume-related bonuses over the holding period of a vehicle, rather than credit them directly to its profit and loss account in the month in which they were receivable. This impacts on the company's gearing, and led to a second set of adjusted results, showing turnover at £123.1 million (£109m) and pre-tax profits of £12.2 million (£7.5m) for the six months to October 31, 1999.