Final Results

Vp PLC
15 June 2004



                                                                    15 June 2004

                                     Vp plc


                              Preliminary Results


Vp plc, the equipment rental specialist, today announces its preliminary results
for the year ended 31 March 2004.


Highlights


•    Turnover up 11% to £83.5m (2003: £75.5m)


•    Profit before tax up 19% to £8.9m (2003: £7.5m)


•    Earnings per share increased by 18% to 14.59p (2003: 12.36p)


•    Recommended final dividend of 3.4p per share (2003: 3.0p) giving a total
     dividend of 5.0p per share (2003: 4.5p) an increase of 11%


•    Return on capital employed improved to 15.1% (2003: 14.4%)


•    Net debt of £7.5m (2003: £6.1m), representing gearing of 14%, after
     rental fleet investment of £10.8m (2003: £14.1m) and £6.5m of acquisitions
     during the year





Jeremy Pilkington, Chairman and Chief Executive, commented:



'Overall, the Group has delivered another very satisfactory performance with
some excellent individual results.  Hire Station has been a disappointment but
we have taken robust steps which we believe will provide a sound platform for
the future.



Our ambition remains to deliver sustainable profit growth whilst further
improving return on capital employed and we believe that the constituent
elements to achieve this are in place.



The Group's strong balance sheet and low gearing enables us to take advantage of
growth opportunities as they arise, as has been clearly demonstrated by the
successful expansion within Groundforce this year.'





For further information please contact:


Vp plc
Jeremy Pilkington, Chairman and Chief Executive     Tel: [phone]
Neil Stothard, Group Finance Director               Tel: [phone]


Bankside
Sarah Hollins                                       Tel: [phone]
Henry Harrison-Topham                               Tel: [phone]





CHAIRMAN'S STATEMENT


OVERVIEW


I am pleased to report another very satisfactory year for the Group overall.
Profit before tax rose 19% to £8.9m (2003: £7.5m) on turnover up 11% to £83.5m
(2003: £75.5m).  Earnings per share increased by 18% to 14.6p.



The Board is recommending a final dividend of 3.4p making a total dividend for
the year of 5.0p (2003: 4.5p), an increase of 11%.  The dividend is payable on 1
October 2004 to shareholders registered as of 10 September 2004.



Our strong cash flow has enabled us to maintain gearing at a very acceptable 14%
even in a year when we have invested £10.8m in our rental fleets and made a
number of acquisitions with an aggregate consideration of £6.5m.



Groundforce



Rental and sales of excavation support systems to the water, civil engineering
and construction industries, plus three specialist offerings: Piletec - pile
driving and breaking equipment; Stopper Specialists - pipe integrity testing
products; Survey Technology - surveying and water flow measurement instruments.



This was another outstanding year for Groundforce which saw profits nearly
double to £5.3m (2003: £2.7m).  Turnover rose by 58% to £19.3m (2003: £12.2m).



Groundforce experienced strong demand from the civil engineering sector
including several large, one-off projects such as the Channel Tunnel Rail Link
and Heathrow Terminal 5.  Activity associated with the third phase of the water
utilities capital investment programme (AMP3) continued and although this five
year infrastructure improvement programme is now nearing its end, planning for
its successor, AMP4, has already commenced.  We are cautiously optimistic that a
smooth transition between the two programmes will be achieved.



Although Groundforce's core activity remains the design and provision of ground
support systems it has, over the past two years, considerably extended its
complementary range of specialist services.  Survey Technology supplies laser
and surveying equipment and hires and services water flow monitoring equipment.



Piletec hires a broad range of piling hammers, breakers and sheet piles and
Stopper Specialists provides pipe stoppers and testing equipment.



Piletec and Stopper Specialists are the longer established of these businesses
and both have had a very successful year contributing significantly to the
excellent overall Groundforce achievement.



During the year, Groundforce made four acquisitions.  In July 2003, we acquired
the share capital of Trench Shore Limited for £2.7m.  Trench Shore served
similar markets to our own ground support business and in the year ended 31
October 2002 reported turnover of £4.1m and net assets of £2.5m.  In March 2004,
we acquired the business and assets of Eve Shorco, a trading division of
Peterhouse Group PLC for a consideration of £2.15m.  Eve Shorco is a long
established supplier of shoring equipment which had net book value of assets of
approximately £2.6m at completion.  These two acquisitions have considerably
strengthened our position in the ground support market and improved our coverage
of the important South Eastern region with the addition of three more branches.



In September 2003, we acquired In Depth for £0.45m.  In Depth rents and provides
service support for water flow monitoring equipment.  This acquisition further
extends the range of our specialist water industry offering.



In February 2004, we acquired the laser and survey equipment rental business and
assets of Sokkia Limited for £1.15m.  This acquisition considerably strengthens
our existing laser and survey business and the addition of branches in Crawley,
Crewe and Birmingham improves our national coverage.



All these acquisitions have been fully integrated within Groundforce and are
performing in line with our expectations.



Investment in rental fleet totalled £1.8m (2003: £1.4m).



UK Forks



Hire of rough terrain material handling equipment and accessories to the
housebuilding and construction industry.



UK Forks made another solid contribution with profits of £1.3m (2003: £1.3m) on
turnover of £12.4m (2003: £10.8m).



Since its inception just four years ago, UK Forks has established itself as the
UK's leading specialist hirer of telescopic handlers and associated equipment
working closely with our customers to identify opportunities to improve safety
and productivity on building sites.  The fleet of well over a thousand machines
enjoys particularly high levels of utilisation due to centralised booking,
efficient fleet management and market sector targeting.



Market conditions remain positive particularly in the key housebuilding sector
and we welcome the recognition of the necessity for long term planning to
improve the national housing stock.



Investment in rental fleet totalled £2.5m (2003: £2.9m).



Airpac Oilfield Services



Servicing the international oil and gas exploration and development markets with
specialist air compressors and associated equipment.



This year has been Airpac's first full year as a pure oilfield services support
business following the disposal of its onshore rental business in 2002. Profits
rose 22% to £533k (2003: £436k) on turnover of £3.7m (2003: £4.1m, excluding
onshore turnover).



Airpac has continued to develop its market leading position in the provision of
specialist compressed air and on-site steam and nitrogen generation services
supporting industry segments as diverse as well testing, structural fabric
maintenance, pipeline dewatering and underbalanced drilling.



Project activity in the South East Asia market, serviced out of our Singapore
base, was relatively weak in the first half but the order book for 2004/5 is
considerably stronger.  North Sea activity remained healthy during the period.



Although Airpac is the smallest of our Group businesses, we believe that its
established reputation within this highly specialist sector offers excellent
growth opportunities in this global market.



Investment in rental fleet totalled £0.5m (2003: £0.9m).



Hire Station



Rental and sale of tools, small equipment and allied services to industry,
construction and homeowners, plus three specialist offerings: Safeforce - safety
and environmental products, Lifting Point - materials handling and lifting gear
hire, One Call - national call centre for tool hire.



Turnover was static at £36.5m (2003: £36.2m) but reorganisation and
rationalisation costs of approximately £0.5m resulted in a loss for the year of
£0.4m.  Like for like profit for the prior year was £0.9m.



This result reflects a very disappointing year for Hire Station, but one in
which I believe we have started to lay the foundations for the future.  As
reported in my interim results statement, a number of measures have been taken
to restore this business to a more acceptable performance including the
appointment in November 2003 of John Singleton as Managing Director.  His new
management team has launched a series of initiatives to reduce costs and deliver
sales growth.  These include the consolidation of three administrative centres
into a single national accounting centre, rationalisation of the senior and
middle management structures, refocusing of the sales effort and closure of a
number of branches.  These changes have reduced the overhead cost base and will
give us a clearer emphasis on revenue and profit growth in the future.



Safeforce had an extremely busy year creating a national network of locations,
the most recent of which started trading in Leeds in February 2004.  Lifting
Point has also had a very active year adding a number of new locations to its
network.  Both of these branch-opening programmes had a negative effect on
profit in the period but the infrastructure now exists on which to build
profitable revenue growth.



One Call had a very solid year.  Total revenues were up on prior year and some
significant business wins were gained, particularly in the retail market.



Investment in rental fleet totalled £4.2m (2003: £6.2m).



Torrent Trackside



Hire of portable track repair and renewals equipment, trackside lighting and
related support services to rail infrastructure maintenance companies.



As highlighted in my statement last year, we did not expect a repetition this
year of Torrent's exceptional 2003 performance.  Torrent nevertheless produced
an excellent result with profits of £2.3m (2003: £3.1m).  Turnover rose
marginally to £11.6m (2003: £11.3m).



The announcement by Network Rail in October 2003 that it was taking track
maintenance contracts back in-house caused considerable uncertainty within the
industry and led to the deferral of some project work.



The transition to in-house management of maintenance contracts is now largely
completed and we are pleased that the renewals contracts have been awarded
thereby permitting this work to be undertaken.



Given the ongoing changes within the rail sector and the inevitable political
dimension to the decision making process, it is difficult to predict the likely
structure for the industry with any reasonable degree of certainty.  However,
the need for very significant investment in the rail infrastructure network is
inescapable and Torrent is excellently placed both in terms of expertise and
market share to benefit from the promised future spending.



Investment in rental fleet totalled £1.8m (2003: £2.7m).



Management changes



The Group's activities have grown to a size and diversity where the Board now
considers it appropriate to strengthen the senior management team.  I am
therefore pleased to report that Neil Stothard has been appointed Group Managing
Director with responsibility for operational management of the Group's five
businesses.  I shall become Executive Chairman.  Neil will be succeeded as Group
Finance Director in July 2004 by Mike Holt who joins us from Rolls- Royce Group
plc.  These Board changes have been announced earlier today.



The Board believes that this new management structure will assist us to take
full advantage of the many growth opportunities that we continue to identify.



SUMMARY AND OUTLOOK



Overall, the Group has delivered another very satisfactory performance with some
excellent individual results.  Hire Station has been a disappointment but we
have taken robust steps which we believe will provide a sound platform for the
future.



Our ambition remains to deliver sustainable profit growth whilst further
improving return on capital employed and we believe that the constituent
elements to achieve this are in place.



The Group's strong balance sheet and low gearing enables us to take advantage of
growth opportunities as they arise, as has been clearly demonstrated by the
successful expansion within Groundforce this year.



Jeremy Pilkington
Chairman and Chief Executive



Vp plc

Consolidated profit and loss account for the year ended 31 March 2004


                                                             Notes                2004                   2003
                                                                                  £000                   £000


Turnover                                                                        83,497                 75,546


Trading profit                                                                  20,211                 18,687

Depreciation                                                                  (11,180)               (10,282)

Operating profit before goodwill amortisation                                    9,031                  8,405

Amortisation of goodwill                                                         (377)                  (318)

Operating profit                                                                 8,654                  8,087

Profit on disposal of properties                                                   643                      -

Profit on ordinary activities before interest                                    9,297                  8,087

Net interest payable                                                             (429)                  (581)

Profit on ordinary activities before taxation                                    8,868                  7,506

Taxation                                                       5               (2,529)                (2,119)

Profit for the financial year                                                    6,339                  5,387


Dividends                                                      7               (2,142)                (1,964)


Retained profit for the financial year                                           4,197                  3,423


Earnings per 5p ordinary share                                 6                14.59p                 12.36p

Earnings per 5p ordinary share before goodwill                 6                15.46p                 13.08p
amortisation

Dividend per 5p ordinary share                                 7                 5.00p                  4.50p



All the activities reflected in the profit and loss account are continuing, as
defined by FRS 3.






Vp plc

Consolidated balance sheet at 31 March 2004

                                                               31 March 2004                 31 March 2003

                                                                 £000         £000             £000         £000
Fixed assets
Intangible assets - goodwill                                    7,136                         5,814
Tangible assets                                                49,911                        49,689
Investments - own shares                                        2,315                         1,532
                                                                            59,362                        57,035

Current assets
Stocks                                                          2,018                         2,180
Debtors                                                        21,694                        18,764
Cash at bank and in hand                                        1,087                         3,330
                                                               24,799                        24,274

Creditors: amounts falling due within one year               (17,384)                      (18,619)

Net current assets                                                           7,415                         5,655

Total assets less current liabilities                                       66,777                        62,690

Creditors: amounts falling due after more than one year                    (8,313)                       (8,365)

Provisions for liabilities and charges                                     (4,319)                       (4,377)


Net assets                                                                  54,145                        49,948



Capital and reserves
Called up share capital                                                      2,309                         2,309
Share premium account                                                       16,192                        16,192
Revaluation reserve                                                            599                           832
Profit and loss account                                                     35,018                        30,588
Equity shareholders' funds                                                  54,118                        49,921

Equity minority interests                                                       27                            27
                                                                            54,145                        49,948




Vp plc

Consolidated cash flow statement for year ended 31 March 2004

                                                              31 March 2004                 31 March 2003

                                                                £000         £000             £000         £000

Cash flow from operating activities                                        16,791                        16,644

Return on investments and servicing of finance
Interest paid                                                  (435)                         (564)
Interest received                                                 18                            21
Interest element of finance lease rental payments               (25)                          (73)
Net cash outflow from returns on investments and
servicing of finance
                                                                            (442)                         (616)

Taxation
UK corporation tax paid                                                   (2,407)                       (2,035)

Capital expenditure and financial investment
Purchase of tangible fixed assets                           (13,068)                      (15,285)
Purchase and sale of investments                               (793)                          (25)
Sale of tangible fixed assets                                  7,377                         8,997
Net cash outflow from capital expenditure and financial
investment                                                                (6,484)                       (6,313)

Acquisitions and disposals
Purchase of subsidiaries and businesses (net of cash
and overdraft purchased)                                                  (6,465)                       (1,460)


Equity dividends paid                                                     (1,984)                       (1,875)


Cash (outflow) / inflow before financing                                    (991)                         4,345


Financing
Medium term loans                                              (143)                         (133)
Loan notes                                                     (590)                       (1,039)
Capital element of finance lease rental payments               (519)                         (893)
Net outflow from financing                                                (1,252)                       (2,065)

(Decrease) / increase in cash in the year                                 (2,243)                         2,280






Vp plc



Notes


1.       Basis of preparation

This announcement has been prepared on a consistent basis with the accounting
policies set out in the Group's financial statements as at 31 March 2003.


2.       Total recognised gains and losses


All recognised gains and losses for both years are reflected in the consolidated
profit and loss account.


3.       Trading performance of acquisitions


As a result of the integration of the acquisitions into the existing businesses,
including the transfer of assets between depots, it is not possible to disclose
separately the effect of the acquired businesses on the Group results for the
year.


4.       Reconciliation of movements in consolidated shareholders' funds for 
the year ended 31 March 2004


                                                                              2004                   2003
                                                                              £000                   £000
           Profit for the financial year                                     6,339                  5,387

           Dividends                                                       (2,142)                (1,964)
           Net increase in shareholders' funds                               4,197                  3,423
           Opening shareholders' funds                                      49,921                 46,498
           Closing shareholders' funds                                      54,118                 49,921



5.       The current and prior year effective tax rates are slightly lower than 
expected due to the write back of over provisions from previous years.


6.       Earnings per share have been calculated on 43,444,660 shares 
(2003: 43,600,602) being the weighted average number of shares in issue during 
the year.


7.       The Directors are proposing a final dividend of 3.40 pence (2003: 
3.00 pence) per share making a total dividend for the year of 5.00 pence (2003: 
4.50 pence) per share which is payable on 1 October 2004 to shareholders on the
register on 10 September 2004.


8.       Reconciliation of operating profit to net cash inflow from operating 
activities

                                                                              2004                     2003
                                                                              £000                     £000

        Operating profit                                                     8,654                    8,087

        Depreciation                                                        11,180                   10,282
        Amortisation of goodwill                                               377                      318
        Profit on sale of tangible fixed assets                            (1,209)                  (1,738)
        Decrease in stocks                                                     175                      133
        Increase in debtors                                                (1,922)                  (1,473)
        (Decrease) / increase in creditors                                   (464)                    1,035

        Net cash inflow from operating activities                           16,791                   16,644


9.       Analysis of net debt


                                               As at              Cash      Acquisitions             As at
                                             1 April              Flow                            31 March
                                                2003                                                  2004
                                                £000              £000              £000              £000


Cash at bank and in hand                       3,330           (2,243)                 -             1,087
Medium term loans                            (8,254)               143                 -           (8,111)
Loan notes                                     (835)               590                 -             (245)
Finance leases and hire purchase               (388)               519             (354)             (223)
                                             (6,147)             (991)             (354)           (7,492)


10.      The financial information set out above does not constitute the
company's statutory accounts for the years ended 31 March 2004 or 2003. 
The statutory accounts for 2003 have been delivered to the registrar of
companies and those for 2004 will be delivered following the Company's Annual
General Meeting.  The auditors have reported on these accounts; their
reports were unqualified and did not contain a statement under section
237 (2) or (3) of the Companies Act 1985.



    Copies of the full accounts for the year ended 31 March 2004 will be 
    posted to shareholders in July and the Annual General Meeting will be 
    held on 7 September 2004.




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