Strong recovery for VP Plc

UK specialist equipment rental company VP Plc has announced a strong recovery, with pre-tax profit more than doubling in the first half of its financial year, while its fleet investment also doubled.

The North Yorkshire-headquartered company reported a profit before tax, amortisation and exceptional items for £20.2m for the six months ended 30 September 2021, up from £8.6m in the same period of 2020.

EBITDA was £44.5 million compared to £34.1 million.

VP Plc’s MEP Hire business.

Capital investment in rental fleet was £31.7 million compared to £14.6 million in the previous half, with investment “heavily focused towards eco-friendly solutions,” the company said.

It also noted “substantial progress in ESG initiatives” and a new road map to net zero as highlights.

VP Plc has also signed up to the Science Based Targets Initiative to reach net-zero global emissions by 2050.

A ‘science-based’ target is set in line with the reductions required under the Paris Agreement to limit global warming to well-below 2°C and work towards limiting warming to 1.5°C.

The company said its performance was buoyed by its UK Division, which “delivered excellent performance” driven by infrastructure and buoyant house building.

Its international division was “stable”, and overall demand in commercial construction and civil engineering had been “solid”.

It said solid trading was expected to continue, supported by “positive momentum” in infrastructure, construction and housebuilding.

Meanwhile VP Plc’s first strategic acquisition since Covid-19 of M&S Hire was described as an “Excellent addition to the successful MEP Hire business which complements existing operations well.”

Commenting on the results, Jeremy Pilkington, Chairman of Vp plc, said: “Very encouragingly, some of our businesses are already trading in line or ahead of expectations.

“Where this is not the case, it is generally down to factors such as the longer-term cyclical nature of some of our infrastructure markets and localised supply chain constraints which are impacting elements of the construction sector.

“We expect these markets will recover and this remains an opportunity for further growth.”

Looking ahead, volumes in AMP7 - the UK’s water industry asset management plan period from 2020-2025, and CP6 - the strategic business plan for rail projects between 2019 and 2024 - were also expected to pick up in the second half of the year, providing “significant upside potential for 2022”.