Vp enjoys solid start to year as trade defies tough market
The Harrogate-based group supplies equipment ranging from small power tools to portable roads and powered ground supports.
“This promising start to the new financial year, coupled with the group’s continued balance sheet strength and diversity of activity, provides the board with confidence that Vp will deliver further satisfactory results in the current financial year,” said Vp, headed by chief executive Neil Stothard.
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Hide AdLast month Vp bought two equipment rental businesses from Balfour Beatty for £4m. Its Hire Station division bought Balfour Beatty’s survey, safety and communication equipment business based in London and Glasgow.
Vp’s UK Forks division bought Balfour Beatty’s plant rental business, which has depots in Croydon and Exeter.
Yesterday the group said these businesses are “integrating well”.
The company reported robust trading in May, delivering record turnover. It has shifted away from general construction in recent years to the more resilient markets of infrastructure, rail, housebuilding and oil and gas.
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Hide AdVp now earns about 43 per cent of its revenues from infrastructure, compared with 33 per cent in 2008. Construction revenues have fallen from 39 per cent in 2008 to about 24 per cent.
Profits before tax, exceptional items and amortisation rose to £16m in the year to the end of March, from £13.8m a year earlier. Revenues surged to £163.6m from £141m.
All six of its divisions, which span construction tools, portable roadways, forklift trucks, rail equipment, ground supports and oilfield services, remained profitable.
Despite spending a third more on its fleet at £32.1m, net debt was broadly unchanged at £40.4m at the end of March. Vp also recently bought back £7.8m of shares via a tender offer to improve returns for investors.
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Hide AdVp hailed the strength of its balance sheet, which it believes offers scope for growth.
Yesterday it said: “Despite challenging markets, the group continues to identify and secure new opportunities.”
Vp has rebounded strongly since its 2010 trough, when profits and sales tumbled.
It responded by slashing debt and cutting costs, including shedding eight per cent of its workforce, plus re-focusing its business.