VP group, a Harrogate-headquartered equipment rental company, has achieved strong growth in its operating profit due to strong infrastructure, construction and residential construction.
The listed company released audited final results for the year ended March 31, 2022 which include a 67% increase in pre-tax profit to £38.9 million (2021: £23.3 million) and a 14% increase in revenue to £350.9 million (2021: £308 million).
EBITDA before exceptional items rose 22% to £88.9 million (2021: £72.7 million).
As previously reported, VP has launched a formal sale process and the firm said today that more information will be provided to shareholders when appropriate. The company adds that it is “business as usual,” and the group is focused on executing its plans for the current fiscal year.
Jeremy Pilkington, chairman, said: “These results show significant progress across the Group as the business continues to recover from the impact of the Covid incident and we are seeing good progress on all key financial indicators.
” We are particularly pleased with the increased investment in the rental fleet, which has been driven by increased demand and a focus on low-emission products.
“The high return on average capital invested demonstrates the sustainability of the Group’s earnings quality.
” Despite some macroeconomic factors related to cost inflation and supply chain disruptions, we see significant growth opportunities this year and beyond.”
Among the highlights of the period were two major contract wins . In March 2022, the Valero refinery renewed its long-term support contract .
Also in March, a new five-year exclusive lease partnership with Watkin Jones , which included the acquisition of Watkin Jones’ own plant and tool fleet .
And throughout VP’s operations, there has been good progress in digital innovation.
VP emphasizes the continuous development and implementation of ESG initiatives across all of its divisions.
It says that all divisions of the business continue to implement new green equipment solutions for its customer base. During the year, the group supported regional restoration and conservation projects in the U.K., and further projects are under development.
VP notes that the start of the new fiscal year has been encouraging, and management has taken a proactive approach to mitigating cost inflation and supply chain delays.
It says growth in the group’s three key sectors provides a favorable market backdrop for the new fiscal year.
Neil Stothard , chief executive officer, added: “The quality of our trading recovery is extremely pleasing and these results demonstrate a significant increase in profitability and a significant recovery in the quality of those profits.
“These strong results are largely supported by the core markets we serve.
“I am optimistic about the future of Vp and believe that our core markets will continue to offer good opportunities to further increase demand for our products and services in the new fiscal year.”
Stothard emphasized that the company’s return on average capital invested is now back to pre-crisis levels, adding that VP is successfully coping with current inflationary pressures.
Like many other businesses, he said the group has had to contend with a tight labor market and supply chain problems, although the war in Ukraine has not directly affected it.
But he pointed to key opportunities for VP over the next few months, such as the next investment cycle for the UK water industry (AMP7), growing investment in the rail industry, including the Trans Pennine upgrade, and, for VP’s international division, reopening the border in Australia, New Zealand and Malaysia.