Equipment hire group reports resilience amidst tough market conditions

Tool hire specialist, Vp has highlighted a strong performance in the Infrastructure market with continued demand from the rail, transmission and water sectors as it issues audited final results for the year ended 31 March 2024.

The Harrogate-headquartered business, which employs about 2,700 people including at least 400 in Yorkshire, reports revenues of £368.7m (2023: £371.5m), a statutory pre-tax profit of £2.8m (2023: £30.7m) and an adjusted pre-tax profit of £39.7m (2023: £40.5m).

Vp adds it has a robust balance sheet with a reduction in net debt. Refinance of a £90m Revolving Credit Facility was secured during the year, complementing existing private placements of £93m.

Anna Bielby, chief executive, said: “The group has again delivered sector-leading returns, led by a strong performance in Infrastructure.

“Whilst some economic uncertainty remains, particularly in Construction and Housebuilding, we remain confident in our ability to react to changes in end markets and take advantage of economic improvements.

“We have made considerable progress in FY24 with new leadership and a refreshed strategy. We are excited about the future and have confidence in our ability to both grow the business and drive value through simplifying the way we work.”

Bielby said the group had been helped by the specialist nature of its business and the diverse markets it operates in.

She said where appropriate, Vp will look to take advantage of merger and acquisition opportunities and is cautiously optimistic about the future.

Vp says it made an increased investment in its rental fleet – £63m – with a continued transition towards environmentally friendly solutions.

The business notes challenges remain in General Construction, particularly impacting its Brandon Hire Station operation and resulting in a non-cash impairment. 

Vp explains this division now has a new management team and its initiatives, including closure of some of its branches, are starting to have a positive impact.

In its outlook statement, Vp states that while economic uncertainty continues, the group has made a solid start to the new financial year.

The group warns that headwinds remain in the Housebuilding market, with a slight drop in activity levels.

Bielby said the group expects General Construction and housebuilding to stay “subdued” into the 2025 financial year, but added the business can exploit a strong pipeline of infrastructure schemes along with greater clarity from Government following next month’s General Election.

“Where there are large projects and when there is certainty we are well placed to capitalise,” she said.