Equipment hire specialist Vp's (VP.) UK division put in a strong performance for the reported period. Domestic operating profit grew 17 per cent to £35.9m, off a 14 per cent increase in the top line. Led by the Hire Station business, all the UK segments demonstrated organic growth in the year, with robust demand and a first full-year contribution from Higher Access, the specialist in tracked access platforms. The group poured £57.6m into the rental fleet in the year, up from £45.9m in 2016, and managed to keep return on average capital employed high at 16 per cent. This was enough to beat forecasts, prompting a slew of analyst upgrades and pushing the shares up 4 per cent on results day.
Internationally the business has continued to struggle with challenging conditions in the oil and gas sector, which is affecting testing, rig maintenance and exploration demand. The acquisition of Australia-based technical equipment rental specialists TR Group helped operating profit for the division to rise 58 per cent - albeit from a low base - to £1.9m for the year. In November 2016, the group purchased TechRentals NZ, which previously formed part of TR Group.
Analysts from N+1 Singer are forecasting adjusted profit before tax of £39m, giving EPS of 77.4p in the year to March 2018 (FY2017: £34.9m, 67.4p).
VP (VP.) | ||||
|---|---|---|---|---|
| ORD PRICE: | 891p | MARKET VALUE: | £ 358m | |
| TOUCH: | 883-903p | 12-MONTH HIGH: | 905p | LOW: 615p |
| DIVIDEND YIELD: | 2.5% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 342p* | NET DEBT: | 72% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 167 | 16.4 | 33.6 | 12.25 |
| 2014 | 183 | 18.9 | 39.8 | 14.00 |
| 2015 | 206 | 25.1 | 51.0 | 16.50 |
| 2016 | 209 | 27.5 | 57.5 | 18.85 |
| 2017 | 249 | 30.3 | 60.3 | 22.00 |
| % change | +19 | +10 | +5 | +17 |
Ex-div:13 Jul Payment:08 Aug *Includes intangible assets £47.5m, or 118p a share | ||||
