vp plc/media/files/v/vp-plc/company-presentati… · market 2016 2015 decline on segment £m £m...

The Equipment Rental Specialists 1The Equipment Rental SpecialistsThe Equipment Rental Specialists

Vp plcInterim Results for

the period ended

30 September 2015

The Equipment Rental Specialists 2

AGENDA

Results

Operational Review

Financial Review


Our strategy

● Aim - to generate sustainable value creation for shareholders

● How - utilising our expertise in asset management

- exceeding customer expectations

- maintaining and utilising our financial strength

- retaining and attracting the best people

● Where - serving diverse markets in the UK and overseas

The Equipment Rental Specialists 4The Equipment Rental SpecialistsThe Equipment Rental Specialists

Results


Results summary

H1 H1

2016 2015

Profit before tax and amortisation £17.2m £16.2m +6%

Revenue £105.1m £101.3m +4%

Earnings per share pre amortisation 35.14p 32.81p +7%

Interim dividend per share 5.35p 5.00p +7%

Return on average capital employed 16.1% 14.9%


Highlights

● Further positive progress - 6% growth in interim profits

● Operating margin increase to 17.3%

● Return on average capital employed improved to 16.1%

● Fleet investment at similar levels to prior year

● Weaker oil and gas and transmission markets

● Infrastructure and housebuild markets driving growth

● Acquisition of Test & Measurement Hire - November 2015


Revenue and profit profile

Revenue

(£m)

Profit before tax and amortisation

(£m)

Revenues growing Progressive profit trend

The Equipment Rental Specialists

**

*N+1 Singer estimate *N+1 Singer estimate


Operational Review


Markets

* Utilities, Rail, Transmission and Facilities Management

House

building

Oil &

Gas

Construction

Infrastructure

H1 H1 Growth/

Market 2016 2015 decline on

Segment £m £m prior year

Rail

Transmission/Water

Construction 28.8 27.6 +4% Election ?

Oil & Gas 10.2 12.2 -17% Oil price

Housebuilding 13.3 10.2 +30% Market share

Other 6.0 6.7 -10%

Total 105.1 101.3 +4%

+5%

Revenue

Infrastructure* 46.8 44.6


Business performance

2016 2015 2016 2015

£m £m £m £m

9.8 9.1 2.9 2.3 Market share growth, housebuild

24.5 22.6 5.6 5.0 Major projects and construction

8.5 11.2 1.0 1.7 Oil & Gas price

39.2 36.1 6.1 4.8 Excellent performance in stable markets

15.7 13.0 1.7 1.3 CP5 / full year of acquisition

7.4 9.3 0.9 2.0 Weak transmission/renewables

TOTAL 105.1 101.3 18.2 17.2

Operating Margin 17.3% 16.9% Improved margin

Revenues H1 PBITA H1


Fleet investment supporting growth

H1 H12016 2015£m £m

7.4 5.2 High utilisation, sustained demand

3.6 3.0 Replacement capex

0.4 3.9 Reduced demand

8.4 8.8 Supporting growth

1.7 2.4 Replacement capex

1.9 0.6 Fleet renewal

Total fleet capex 23.4 23.9

Disposal proceeds (9.2) (5.8) Fleet renewal disposal programme

Net expenditure 14.2 18.1


Operational outlook

● Signs of confidence returning to construction market

● AMP6 not started, but anticipate into 2016

● Transmission - expect improved 2016

● Acquisition bedding in

● Quality of returns remains a key focus


Financial review


Financial highlights – continuing progress

H1 H1 Full Year

2016 2015 2015

Revenue £105.1m £101.3m +4% £205.6m

EBITDA £31.4m £29.2m +8% £53.8m

Profit before tax and amortisation £17.2m £16.2m +6% £26.8m

Net margin 16.4% 16.0% 13.0%

ROACE 16.1% 14.9% 16.2%


Earnings per share – 7% increase

H1 H1

2016 2015

Basic EPS (pre amortisation) 35.14p 32.81p +7%

Profit for period pre tax and amortisation £17.2m £16.2m +6%

Weighted average number shares 38.9m 39.0m

Tax rate 20.5% 21.2%


Dividend per share – 7% increase

Dividend per share (pence)

Interim Dividend Full Year Dividend

16.5

H1 H1 FY

2016 2015 2015

Basic EPS 33.37p 31.36p +6% 51.03p

Dividend per share 5.35p 5.00p +7% 16.5p

Dividend cover 6.2x 6.3x 3.1x


Robust ROACEA

ve

rag

e C

ap

ita

l E

mp

loye

d £

m

RO

AC

E

Average Capital

Employed £mROACE


Strong balance sheet

H1 FY H12016 2015 2015£m £m £m

Rental equipment (fleet) 137.2 131.6 123.5

Other property, plant and equipment 18.7 16.2 12.3

Goodwill and intangibles 42.5 43.4 44.4

Net working capital 0.9 (9.3) (1.7)

Deferred tax/pension (3.1) (3.3) (3.2)

Net debt (81.8) (66.8) (65.4)

Net assets 114.4 111.8 109.8

Gearing 72% 60% 60%

Debtor days 56 58 59

Debt write off as % revenue 0.3% 0.3% 0.2%


17Financial performance - strong cash generation

Cash inflows

Cash outflows

Other

£10.9m

Increase in net debt

£15.0m

Net capex £20.6m

EBITDA : £31.4m

Working

Capital

£6.7m

Tax /

Interest

£3.7m

Dividends

£4.5m


17Bank facilities

H1 May2016 2015£m £m

Committed facilities

Due to expire Oct '17 30 30

Due to expire Oct '17 20 20

Due to expire May '20 45 45

Overdraft facilities 5 5

Total facilities 100 100

Step up facility 20 20

30 Sep 31 Mar2015 2015£m £m

Net debt 81.8 66.8

Headroom 18.2 33.2


17Headroom for growth

Lower interest costs higher EBITA

Greater than 3 times

EBITA

Interest

Cover

Considerable headroom

Less than 2.5 timesNet Debt /

EBITDA


Supplementary schedules


17Cash flow

H1 H1 FY

2016 2015 2015

£m £m £m

Operating profits 17.3 16.4 27.1

Depreciation / Amortisation 14.1 12.8 26.7

EBITDA 31.4 29.2 53.8

Changes in working capital (6.7) (3.0) 2.5

Gross capex (29.8) (24.3) (52.9)

Asset disposal profit (3.1) (2.1) (3.3)

Proceeds from disposals 9.2 5.7 12.0

Acquisitions - (5.4) (5.4)

Interest (1.0) (0.9) (2.0)

Tax (2.7) (0.9) (2.9)

Dividends (4.5) (4.0) (6.0)

Other (7.8) (6.7) (9.6)

Cash movement (change in net debt) (15.0) (12.4) (13.8)


17Effective rate of tax

H1 H1

2016 2015

% %

Standard rate 20.0 21.0

Impact of tax rate change on deferred tax - -

Permanent disallowables 0.3 0.4

Chattels (0.9) (0.7)

Prior year adjustments - -

Non qualifying depreciation 0.4 0.5

Overseas tax 0.7 -

Effective rate 20.5 21.2


17Net working capital

H1 FY H1 Cashflow

Movement

2016 2015 2015 FY 2015

£m £M £m H1 2016

Inventories 5.0 6.5 5.7 1.5

Trade debtors 35.6 36.2 36.5 0.6

Prepayments and other debtors 8.4 4.9 7.9 (3.5)

Trade creditors (16.8) (17.7) (14.9) (0.9)

Accruals, other creditors and tax (31.3) (39.2) (36.9) (7.9)

Net working capital 0.9 (9.3) (1.7) (10.2)

Capital creditors movement 2.5

Other cashflow swap/tax 1.0

Cashflow changes in debtors, creditors and stock (6.7)


Revenue 1970: £2m 1980: £14m 1990: £70m 2000: £55m 2010: £129m 2013: £167m 2014: £183m

2014Vp plc

Celebrates its

60th Anniversary

1954Vibratory Roller & Plant Hire

(Northern) Limited founded

1973Floated on main market

Vibroplant plc

1980Shoring division

established

1982US powered access

business established

1996Tool Hire:

Cannon Tool Hireacquired in 1996

2001Hire Station formed

through merger of5 regional tool

businesses

2002-2004Shoring expansion

through acquisitionof Mechplant,

Trenchshore &Eve Shorco

2006Acquisition of Bukom

Oilfield Services(Airpac Bukom formed)

1975First move into

specialistplant - Airpac

1990Groundforce

acquired fromSGB

1996Exit from USA;

UK specialist businessesexpanded

1997Rail: Torrent

Trackside acquired

2000UK Forks

divisioncreated

2001Renamed Vp plc

2005TPA and

ESSacquired

2007 - 2009Continuing growth in

specialist areas viaacquisitions of MEP and

U Mole

2010Geographical expansion:

Global (Airpac Bukom).Eire (Groundforce),

Germany (TPA)

1954

19731980 1990

2006

2011Mainland Europe -

Groundforce

2014

Group history – 1954 to date

2015: £206m


National hire of telescopic handlers/rough terrain forklifts:

• Only UK national telehandler specialist

• Fleet of c.1700 machines

• Strategically located distribution network

Markets:

• General construction, housebuild and industry

Opportunities:

• Housebuilding, construction recovery, new products and

market share growth


UK market leaders in the rental and sale of shoring

products and solutions:

• Groundforce has the largest excavation support fleet

in the UK and Ireland

• Plus, specialist products and services

° Piletec & Mr Cropper – piling equipment

° Stopper Specialists – pipeline pressure testing

° ‘U’ Mole – trenchless technology

Markets:

• Civil engineering (including regulated AMP

programme), construction and housebuilding

Opportunities:

• Infrastructure, construction and Europe


International rental of high pressure air compressors,

steam generators and specialist equipment supported

by skilled engineers:

• Global network of six service and distribution facilities

located in the UK (Aberdeen and Great Yarmouth),

Singapore, Australia, Middle East and Latin America

• Rental assignments in more than 60 countries

Markets:

• Well testing, rig maintenance, gas transfer, LNG

Opportunities:

• Leveraging global network via regional hubs


Tool hire and specialist equipment for construction and industry:

• Local tool hire branches supported by national call centre

• Plus specialist products and services

° ESS Safeforce

– safety equipment and confined space training

° MEP

– press fitting, electrofusion and low level access

Markets:

• Construction, industry, civil engineering, housebuild, DIY

Opportunities:

• Specialist products, construction sector and market share growth


Provision of rail specific light plant, trackside lighting

and skilled trackside personnel:

• Genuine 24/7 x 365 national support

• The widest range of specialist portable rail equipment

in the UK

• Significant safety and compliance barriers to entry in

a regulated market

Markets:

• Maintenance and renewals projects on national rail

network, London Underground and Network Rail

maintenance contract

Opportunities:

• CP5, maintenance, London Underground


One of Europe’s largest suppliers of temporary access

solutions:

• Operations in UK, Republic of Ireland and Germany

• Skilled installation of bespoke roadways and

walkways

Markets:

• Transmission, construction, rail and outdoor events

Opportunities:

• Regulated transmission programme, new products

and European growth

vp plc/media/files/v/vp-plc/company-presentati… · market 2016 2015 decline on segment £m £m...

Documents