Equipment rental firm Ashtead has raised its dividend as its profits continue to soar.

The group also announced a £200 million share buyback earlier in the week after going against the tide of its publicly listed peers and posted a 24% increase in profits for the year.

The company, which is listed in the FTSE 100 and conducts 80% of its business in the US, reported a £617 million profit before tax for the year up to April 30.

In particular, a strong fourth quarter and improved margins meant an increase in revenue by 19% to £2.5 billion, while profits came in above the expectations of many analysts.

Ashtead Chief Executive, Geoff Drabble, said that the company has enjoyed another positive year and that has carried on to this year with steady improvements seen in the first six weeks of 2016. This has resulted in confidence in the firm.

He thinks that the construction sector, which provides about 45% of the company’s business, will see a continuation of moderate growth away from the residential sector.

Mr Drabble added that those who had lived through 2009 and 2010 approach growth with great caution and don’t want to create another ‘bubble’.

He believes that the growth seen is very responsible and the company chiefs expect it co continue for the next few years.

The positivity coming from Ashtead is in contrast to many of its rivals who have suffered downbeat guidance and recent disappointing results.

For example, America’s biggest rental group, United Rentals, reported a 20% decrease in first quarter profits for 2016, and cut full year forecasts.

However, Mr Drabble responded to this by saying that the reason for this fall is specific only to that company and that it does not reflect the strength of the wider industry, where thousands of small business are dominating.