21.11.2017

12 percent lift for Vp

UK rental group Vp, owner of UK Forks and Higher Access has reported a solid increase in half year revenues and profits.

The interim report no longer includes performance by division, so we are unable to see how UK Forks or Hire Station performed. Total revenues however were 12 percent higher at £135.99 million of this £120.3 million came from the UK, up 11 percent on the same period last year, while the growing international division was 15 percent higher at £15.7 million, however operating profits in the division were halved to £261,000 due to difficulties at oil field services business Airpac Bulkom. The TR business in Australia also included TechRent New Zealand, acquired this time last year and is said to have performed well.

Pre-tax profits for the group improved 15 percent to £20.31 million. Net debt at the end of September was seven percent higher than a year ago at £115.4 million, while capital expenditure on the fleet increased 10 percent to £32.5 million.

Since the close of the reporting period – this month – the company has made two acquisitions, taking over Brandon Hire for £68.8 million See Vp acquired Brandon and in a smaller deal it purchased First National, a specialist rough terrain fork lift rental business based in the Midlands, for £1.7 million. The business will be absorbed into UK Forks.

Chairman Jeremy Pilkington said: "Vp has again delivered an excellent set of results for the half year. The UK market remains strong, and whilst there is some uncertainty around the implications that Brexit will have on the UK, the day to day demand continues to be highly positive. There is also an improving trend for our International Division in the second half of the year.”

“A significant post period highlight was the successful acquisition of Brandon Hire and this, coupled with the organic opportunities available elsewhere within the group, encourages the board to look forward to the second half of the year and beyond with every confidence."

Vertikal Comment

This is another solid result from Vp, and bodes well for the full year, not to mention fiscal 2018. The company might just exceed £300 million in revenues for the current year, a new record that puts it on a par with HSS, and within reach of Speedy Hire. More importantly it is far more profitable than both of them.

What will be interesting now is to see if the company holds off on further acquisitions while it absorbs Brandon and pays down its debt, or continues on the acquisition front. Much will depend on opportunities that might arise of course. All said and done an excellent half year performance.