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Presentation to Carillion

Vp plc Final Results for the year ended 31 March 2010. Presentation to Carillion. 9 th June 2010. The Equipment Rental Specialists. The Equipment Rental Specialists. Summary. Profit before tax, amortisation and exceptional items. £16.0m. Revenue. £134.2m.

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Presentation to Carillion

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  1. Vp plc Final Results for the year ended 31 March 2010 • Presentation • to Carillion 9th June 2010 The Equipment Rental Specialists The Equipment Rental Specialists

  2. Summary Profit before tax, amortisation and exceptional items £16.0m Revenue £134.2m Earnings per share pre amortisation 27.57p Dividend per share 10.8p

  3. Operational review

  4. Highly satisfactory outcome • Difficult trading conditions in most markets • Explicitly profitable • Early cost actions to mitigate fall in demand • Strong operational cash flows • Working capital benefit of £5.2m • Fleet sales generated £8.5m, at a profit • Cash conserved, borrowings reduced by £17.5m • Net assets increased by £7m • Quality, breadth and resilience demonstrated

  5. Revenue and Operating Profit trends Operating Profit (£m) Revenue (£m)

  6. Group structure The Equipment Rental Specialists

  7. Divisional overview • Divisions impacted by recession to varying degrees • All divisions profitable • All divisions cash generative • Cost actions across all businesses • Investment in sales and marketing • Improved co-ordination between divisional sales teams • Harbray acquisition post year end

  8. Business performance

  9. Capital expenditure

  10. Rebranding Divisions rebranded to better reflect association with Vp whilst explicitly maintaining the specialist focus that customers value

  11. Strength through diversity

  12. Overseas growth • Overseas activities growing as proportion of Group revenues • Airpac Bukom, plus TPA, Groundforce and Hire Station

  13. Oil and Gas – global support network North Sea Middle East Americas Singapore Africa Australia Overseas hubs established 2002- 2008

  14. Operational outlook • Anticipate overall stability with areas of volatility • Breadth of markets will remain a key asset • Maintain strong balance sheet but ….. suitable opportunities • will be pursued • In excellent financial shape to sustain the development • of the Group over the longer term

  15. Financial review

  16. Financial highlights

  17. Components of pre-tax profit

  18. Cost saving measures (fixed costs)

  19. Earnings and dividend per share

  20. Robust balance sheet

  21. Operating cash flow

  22. Total cash flow

  23. Modest gearing, comfortably within covenants Net debt Underlying gearing -17% -12% -23% -17% Interest cover (12 months) Net debt / EBITDA (12 months) -6% -7%

  24. Bank facilities being refreshed

  25. Conclusion

  26. Long term shareholder value enhancement • Highly satisfactory results in a challenging market environment • Prudent financial management • Double digit margins, double digit ROCE • No asset write downs • No bank restructuring • No equity funding required • Balance sheet strengthened organically • Maintained dividend • £17.5m cash – all units cash positive

  27. Quality returns Operating Margin (%) Return on Average Capital Employed (%) Earnings per share (pence) Dividend per share (pence)

  28. Outlook • UK more stable but public sector funding challenges ahead • Overseas contribution growing – adds further market diversification • Quality opportunities scarce but will continue to be pursued • Product and market mix provides downside resilience and upside opportunity

  29. Vp plc Final Results for the year ended 31 March 2010 • Presentation • to Carillion 9th June 2010 The Equipment Rental Specialists The Equipment Rental Specialists

  30. Supplementary schedules

  31. Net working capital

  32. Shareholder value

  33. Effective rate of tax

  34. Shareholder return

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