Steady demand from the housebuilding sector drove a solid 5 per cent rise in half-year operating profit for equipment rental group Vp (VP.). Unsurprisingly, revenues at the group's Airpac Bukom business suffered as a result of its exposure to oil and gas markets. However, this was more than offset by a particularly strong performance from the group's Hire Station and UK Forks businesses. The group - which is engaged in the rental and sale of specialist products and services, including scaffolding, lighting and power systems - also managed to increase its return on capital to 16.1 per cent from 14.9 per cent a year earlier.
Vp's Hire Station business - which supplies small tools and specialist equipment for industry and construction - was the stand-out performer, increasing operating profit by more than a quarter to £6.1m. Despite faltering demand from water suppliers as they transitioned to the new AMP6 regulatory period, strong demand for housebuilding and basement propping schemes helped the Groundforce business grow its operating profit by 12 per cent.
Broker Peel Hunt expects adjusted EPS of 53.9p for the March 2016 year-end, up from 50.3p in 2015.
VP (VP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 740p | MARKET VALUE: | £297m | |
| TOUCH: | 740-762p | 12-MONTH HIGH: | 816p | LOW: 585p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 284p* | NET DEBT: | 72% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 101 | 15.5 | 31.4 | 5.00 |
| 2015 | 105 | 16.3 | 33.4 | 5.35 |
| % change | +4 | +5 | +6 | +7 |
Ex-div: 3 Dec Payment: 8 Jan *Includes intangible assets of £42.5m, or 106p a share | ||||
