5th Jun 2014 10:12
LONDON (Alliance News) - VP PLC, the equipment rental specialist, Thursday reported a higher profit for its recently completed financial year, which it said was boosted by a 10% increase in revenues during the year, having seen strong demand from infrastructure projects, increasing customer demands and contract wins across the business.
The group said it is looking forward to the year ahead with confidence, having entered the new financial year with strong business momentum. Underlining its confidence, VP raised its full-year dividend by 14% to 14.0 pence, up from 12.25 pence a year earlier.
"Economic indicators in the UK and mainland Europe now appear more positive than for some time and all businesses within the Group are identifying significant opportunities for growth and investment," said Chairman Jeremy Pilkington in a statement.
VP reported pretax profit of GBP18.9 million for the financial year ended March 31, up from GBP16.4 million a year earlier, as revenues for the year rose 10% to GBP183.1 million from GB167.0 million the prior year.
VP said the return on capital employed improved to 13.5% in the year from 13.3% a year earlier, and said it has maintained above the target threshold of 12% for 10 consecutive years.
The group also upped its investment in its rental fleet, having spent a total of GBP38.2 million in rental fleet capital expenditure in the year, compared with GBP22.5 million a year earlier. Investment in rental fleet is a combination of growth, replacement and substitution, it said.
VP said that the market environment for the group during the year was largely supportive, as housebuilding, infrastructure, water and transmission markets continued to generate good demand throughout the year.
"Whilst we are expectant of a modest rate of improvement in construction, the trend is positive and the group is well positioned to benefit from this recovery as it happens," the company said in a statement.
It added: "Building on another good year for the group, we expect further positive development both in the UK market place but also in our smaller but growing overseas activities".
VP shares were up 7.4% at 684.96 pence Thursday morning.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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