11.06.2025

Flat year for Vp

UK rental group Vp - owner of UK Forks, MEP and Brandon Hire Station - has published its full year results for the year to the end of March 2025.

Total group revenues were £380 million up 3.1% on the same period in 2024 made up as follows:

UK
Revenues: £317.6 million + 2.5%
Operating profit: £37.4 million – 5%

International
Revenues: £62.3 million +5%
Operating profit: £9.6 million -4.5%

Group Pre-tax profit jumped from £2.8 million to £21.7 million, However, last year included a £28.1 million non-cash write down of Brandon Hire assets - largely goodwill and brand value - compared to £884,000 this year. Add these back in for an underlying result and you have £22.6 million compared to £30.9 million last year - a decline of 27%.
A positive factor in this year’s results is a reduction in bad debt write offs from £3.74 million last year to £1.75 million in the year just closed. However, administration costs soared 35 percent to £65.4 million.

Capital Expenditure
Capital expenditure on the rental fleet was four percent higher at £65.4 million, although this was not spread evenly through the company’s operations.

Net Debt
Net debt increased 11 percent to £138.5 million.

Current trading and outlook

The company said: “Despite continued economic uncertainty, Vp has made a solid start to the financial year with strong momentum in Infrastructure and specialist construction. Performance for the new financial year to be in line with current market expectations.”

In other words expectations are that revenues will be relatively flat at £383.2 million, with a pre-tax profit - before amortisation, write downs, exceptionals etc.. of £37.3 million, compared to £36.7 million this year, while net debt is expected to be marginally lower.

Chief executive Anna Bielby said: "We have delivered a resilient performance against a period of varied economic and geopolitical headwinds, with our diverse and increasingly collaborative specialist businesses driving sector leading returns. As a result of this performance and our robust balance sheet, we are pleased to propose an improved full year dividend - maintaining our 30+ year uninterrupted track record and aligning with our commitment to deliver long-term sustainable shareholder returns.”

"During the year, we continued to make changes to our operating model to capitalise on growth opportunities, including the centralisation of operations and the launch of Vp Rail."

"Vp has entered the new financial year in a solid position, with strong early momentum in Infrastructure and specialist construction. While we are encouraged by the UK Government's revitalisation initiatives in Housebuilding, Construction and Infrastructure projects, it is important that we get clarity and certainty around these from the timely publication of its long-term industrial strategy."

Vertikal Comment

This is an OK ..ish result from Vp, given some of the challenges in the UK market, but it does include several months input from the CPH business. The company has strong potential and is financially strong, but much of the focus seems - or comes across - to be on the numbers and the ‘city’ rather than on the customers and the business. But there are some positive moves, such as the introduction of a major account group - Vp Rental Solutions - which will offer central account management for key customers. A similar initiative is Vp Rail.
But in spite of this the company expects the current year to be much the same as this? The word growth can be found throughout report, and yet it expects below inflation growth for the year just begun.

Vp has tremendous potential, which has not shone through in the past year or two, and one wonders if the new ‘centralisation strategy,’ will encourage individual business to be more dynamic and inventive in terms of delighting customers etc... or the opposite. That is down to leadership. Hopefully this year will help propel the business to and beyond the £400 million mark. It is not beyond the realms of reality/potential - in fact it only requires a five percent improvement on last year. Time will tell.