U.K.’s Vp Drops Revenue 5.2 Percent in Fiscal 2020
Vp plc, one of the U.K.’s largest equipment rental companies, posted £362.9 million for its fiscal year ended March 2020, compared to £382.8 million in the previous fiscal year, a 5.2-percent decline. Profit before taxation was £28.8 million, compared to £33.6 million in the previous year.
"The results up until 31 March 2020 can be considered a very satisfactory performance, with modest margin and PBT improvement achieved against a highly uncertain economic backdrop with the U.K. being distracted by Brexit and the general election in December 2019,” said Jeremy Pilkington, chairman of Vp plc. "Vp was expecting to see a return to heightened activity levels across our core markets, however the worldwide government restrictions imposed on movement as a results of Covid-19 have had an impact on trading for the current financial year. We are however encouraged that in several sectors, activity has started to pick up and it is encouraging to hear the emphasis governments are giving to the importance of resuming work wherever possible whilst respecting safety guidelines.
"It is however too early to have visibility on when trading might restore to normal levels, and therefore owing to the exceptional circumstances of Covid-19, the board has decided to delay the decision on a dividend until later in the year when the group would hope to have better visibility of the overall situation. The board appreciates that income is of vital importance to shareholders and we intend to restore normal patterns of distributions as soon as possible.”
"The group took decisive action to control costs at the start of the pandemic including stopping all but essential recruitment and capital expenditure,” added Neil Strothard, chief executive of Vp plc. “We kept many of our operating locations open for business throughout, in support of those critical sectors requiring our services, we initially mothballed some sites and participated in the government's job retention scheme, furloughing approximately half of our U.K. employees at the peak in April. We have since re-opened branches and taken employees out of furlough as demand has slowly recovered. The International division has also been impacted with different countries feeling different effects of the pandemic.
"We have strengthened further our financial position by conserving cash; reducing costs and delaying the dividend. We believe that this will help ensure the long-term resilience of the business as well as its capability to respond quickly as markets recover. Vp is fundamentally sound and is built on over 60 years of successful development. A combination of supporting a diversity of markets across a range of geographies together with a strong financial discipline and an excellent team will help us to quickly re-position the business and allow us to embrace the fresh but increasingly positive challenges that the next 12 months will hold."
Vp, based in London, has six operating divisions: Groundforce, UK Forks, Airpac Bukom Oilfield Services, Hire Station, Torrent Trackside and TPA.
About the Author
Michael Roth
Editor
Michael Roth has covered the equipment rental industry full time for RER since 1989 and has served as the magazine’s editor in chief since 1994. He has nearly 30 years experience as a professional journalist. Roth has visited hundreds of rental centers and industry manufacturers, written hundreds of feature stories for RER and thousands of news stories for the magazine and its electronic newsletter RER Reports. Roth has interviewed leading executives for most of the industry’s largest rental companies and manufacturers as well as hundreds of smaller independent companies. He has visited with and reported on rental companies and manufacturers in Europe, Central America and Asia as well as Mexico, Canada and the United States. Roth was co-founder of RER Reports, the industry’s first weekly newsletter, which began as a fax newsletter in 1996, and later became an online newsletter. Roth has spoken at conventions sponsored by the American Rental Association, Associated Equipment Distributors, California Rental Association and other industry events and has spoken before industry groups in several countries. He lives and works in Los Angeles when he’s not traveling to cover industry events.