Interim Results

Vp PLC
01 December 2003


                                                                 1 December 2003



                                     Vp plc

                                 Interim Results


Vp plc, the equipment rental specialist, today announces its interim results for
the six months ended 30 September 2003.

Highlights

•         Turnover up 10% to £40.9m (2002: £37.1m)

•         Profit before tax increased to £4.1m (2002: £4.0m)

•         Earnings per share improved to 6.47p (2002: 6.34p)

•         Interim dividend increased by 6.7% to 1.6p per share (2002: 1.5p)

•         Net debt of £7.7m (31 March 2003: £6.1m), representing gearing of 15%




Jeremy Pilkington, Chairman & Chief Executive commented:

'I am pleased to report another satisfactory overall performance for the Group.
We believe that our diversified market exposure is demonstrating its value and
provides resilience against varying economic conditions.  In addition, our
strong balance sheet enables us to take advantage of growth opportunities as
they arise.



'The Group is well positioned to deliver a satisfactory outcome for the year.'





For further information please contact:

Vp plc

Jeremy Pilkington, Chairman & Chief Executive          Tel: [phone] (1 December only)


Neil Stothard, Group Finance Director
                                                       Tel: [phone] (thereafter)

Bankside

Sarah Carrell                                          Tel: [phone]
Heather Salmond                                        Tel: [phone]



CHAIRMAN'S STATEMENT



FINANCIAL OVERVIEW



I am pleased to report another satisfactory overall performance for the Group in
the six months to 30 September 2003 in which all businesses with the exception
of Hire Station achieved strong results.  Turnover rose 10% to £40.9m (2002:
£37.1m) and profit before tax increased to £4.1m (2002: £4.0m).  Earnings per
share improved to 6.47 pence (2002: 6.34 pence).



Cash inflow from operating activities was £7.6m (2002: £7.9m).  Net debt at 30
September 2003 was £7.7m (31 March 2003: £6.1m) representing gearing of 15% on
shareholders funds of £52.0m.



The Board has declared an interim dividend of 1.6p per share (2002: 1.5p), an
increase of 6.7%.  This dividend will be payable on 9 January 2004 to
shareholders registered as at 12 December 2003.



BUSINESS OVERVIEW



UK Forks



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



UK Forks had a most satisfactory first half.  Turnover rose 19% to £6.2m (2002:
£5.3m) and operating profits 17% to £0.84m (2002: £0.72m).  Levels of
residential construction, UK Forks largest single market sector, remained steady
and we made further progress in securing longer term relationships with major
house builders.  General residential and commercial activity was buoyed by
infrastructure and PFI related spending.




Groundforce



Rental, sale and design of shoring systems and allied services to the water,
civil engineering and construction industries.



Groundforce continued the pattern of last year's strong performance with
turnover rising by 53% to £8.4m (2002: £5.5m) and operating profits ahead by
144% at £2.2m (2002: £0.9m).   These excellent results from Groundforce were
driven by particularly strong demand in the Southeast and good performances from
the specialist Piletec and Stoppers divisions.  The results include modest
maiden contributions from the acquisitions in the period of Trench Shore Ltd and
Indepth Hire.



In July we announced the acquisition of Trench Shore Ltd for £2.7m.  Trench
Shore extends our product offering and geographic coverage giving us particular
strength in the critical Southeast market.  Trench Shore has now been fully
integrated within Groundforce and has performed in line with our expectations.



In September we announced the acquisition of Indepth Hire for a cash
consideration of £450k.  Indepth is engaged in the hire, service and calibration
of clean water management equipment and compliments the range of services that
Groundforce offers to its customers.



Airpac Oilfield Services



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



Airpac is now a pure oilfield service support business following the disposal of
its non core on-shore rental activities in the last financial year.  We have
enjoyed good demand from the North Sea sector but our new Singapore base
experienced lower levels of project activity than in the first half of last
year.  Turnover fell 41% to £1.9m (2002: £3.2m) due to the elimination of the
on-shore revenue, but operating profits improved 10% to £0.33m (2002: £0.30m).



We continue to invest in improving our customer support capability particularly
for the larger, overseas projects.





Hire Station



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



Turnover in the period rose to £18.8m (2002: £17.8m).  Operating profit was
£0.1m (2002: £1.2m).



Hire Station results, although achieving a level of improvement over its
performance in the second half of last year, are clearly disappointing. We have
taken robust measures throughout the year to restore the performance of this
business including the recent appointment of John Singleton as the new Managing
Director.  John has managed our Services businesses for five years and in this
role has had significant success in implementing business change and delivering
profit growth.



Additional measures taken at Hire Station in the first half of the year include
the closure of two further administrative centres and a number of marginal
branches.  Although limited financial benefit has been derived in the period
under review, we believe these changes will contribute to the establishment of a
platform from which the business can generate acceptable levels of return in the
future.  We have continued the rollout of our Safeforce and Lifting Point
specialist brands which we believe will be increasingly important elements of
the product offering in the future.



Torrent Trackside



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



Turnover rose 6% to £5.6m (2002: £5.3m) but tighter margins held profits back to
£1.1m (2002: £1.4m).



In October, Network Rail announced that it would be taking track maintenance
contracts back in-house. It is difficult to assess the impact this decision may
have on our business but early indications are that maintenance work is likely
to be relatively unaffected.  However we have already seen some delay in the
release of certain renewals contracts.





Nevertheless, Torrent has produced very satisfactory results and we remain
confident that the rail infrastructure investment programme will continue to
provide significant opportunities for Torrent as a major supplier to the rail
industry.



OUTLOOK



We believe that our diversified market exposure is demonstrating its value and
provides resilience against varying economic conditions.  In addition, our
strong balance sheet enables us to take advantage of growth opportunities as
they arise.



The Group is well positioned to deliver a satisfactory outcome for the year.



Jeremy Pilkington

Chairman & Chief Executive




Vp plc

Consolidated profit and loss account


                                         Notes  Six months to   Six months to             Year to
                                                 30 Sep 2003     30 Sep 2002             31 Mar 2003
                                                 (unaudited)     (unaudited)

                                                    £000            £000                    £000

Turnover                                         40,917            37,098                   75,546

Trading profit                                   9,858             9,571                    18,687

Depreciation                                     (5,395)           (5,049)                  (10,282)

Operating profit before goodwill                                                            
amortisation                                     4,463             4,522                    8,405

Amortisation of goodwill                         (174)             (156)                    (318)

Operating profit                                 4,289             4,366                    8,087

Net interest payable                             (210)             (356)                    (581)

Profit on ordinary activities before             4,079             4,010                    7,506
taxation

Taxation                                         (1,264)           (1,243)                  (2,119)

Profit on ordinary activities after              2,815             2,767                    5,387
taxation


Dividends

- Interim                                   5    (698)             (654)                    (654)
- Final                                                      -                 -            (1,310)



Retained profit for the period                   2,117             2,113                    3,423

Earnings per 5p ordinary share              6    6.47p             6.34p                    12.36p

Diluted earnings per 5p ordinary share      6    6.33p             6.21p                    12.13p

Earnings per 5p ordinary share before       6    6.87p             6.70p                    13.08p
goodwill amortisation

Dividend per 5p ordinary share              5    1.60p             1.50p                    4.50p





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






Vp plc

Consolidated balance sheet


                                      30 Sep 2003               31 Mar 2003                30 Sep 2002
                                       (unaudited)                                         (unaudited)

                                    £000       £000           £000        £000           £000        £000
Fixed assets

Intangible assets - goodwill      6,453                       5,814                      5,139

Tangible assets                   50,245                      49,689                     50,763
Investments - own shares          1,704                       1,532                      1,495
                                              58,402                      57,035                     57,397

Current assets
Stocks                            1,934                       2,180                      2,415
Debtors                           21,713                      18,764                     18,939
Cash at bank and in hand          1,207                       3,330                      1,813
                                  24,854                      24,274                     23,167

Creditors: amounts falling due
within one year                   (26,463)                    (18,619)                   (19,268)

Net current (liabilities) /                   (1,609)                     5,655                      3,899
assets

Total assets less current
liabilities                                   56,793                      62,690                     61,296

Creditors: amounts falling due
after more than one year                      (403)                       (8,365)                    (8,508)

Provisions for liabilities and
charges                                       (4,325)                     (4,377)                    (4,150)


Net assets                                    52,065                      49,948                     48,638



Capital and reserves

Called up share capital                       2,309                       2,309                      2,309

Share premium account                         16,192                      16,192                     16,192
Revaluation reserve                           832                         832                        1,230
Profit and loss account                       32,705                      30,588                     28,880
Equity shareholders' funds                    52,038                      49,921                     48,611

Equity minority interests                     27                          27                         27
                                              52,065                      49,948                     48,638




Vp plc
Consolidated cash flow statement


                                                   Note  Six months to 30  Six months to 30     Year to
                                                             Sep 2003         Sep 2002        31 Mar 2003
                                                           (unaudited)      (unaudited)
                                                               £000              £000            £000

Net cash inflow from operating activities            7     7,622             7,932             16,644

Net cash outflow from returns on investments and
servicing of finance                                       (203)             (352)             (616)

Tax paid                                                   (819)             (695)             (2,035)


Net cash outflow from capital expenditure and
financial investment                                       (4,675)           (4,379)           (6,313)

Net cash outflow from acquisitions and disposals           (3,087)           (158)             (1,460)


Equity dividends paid                                      -                 -                 (1,875)



Cash (outflow) / inflow before management of
liquid resources and financing                             (1,162)           2,348             4,345


Net outflow from financing                                 (961)             (1,585)           (2,065)

(Decrease) / increase in cash in the period                (2,123)           763               2,280



Vp plc

Notes


1.                  Basis of preparation

The interim financial statements have been prepared on the basis of the
accounting policies set out in the Group's financial statements as at 31 March
2003.



A tax rate of 31% has been used in the profit and loss account to reflect the
estimated tax charge for the full year.



2.                  Total recognised gains and losses

All recognised gains and losses for the reporting periods are reflected in the
consolidated profit and loss account.



3.                  Trading performance of acquisitions

The trading performance of acquisitions in the period is not material in Group
terms and therefore has not been disclosed separately.



4.                  Reconciliation of movements in consolidated shareholders'
funds for the six months ended 30 September 2003


                                                       Six months to 30  Year to         Six months to 30
                                                       Sep 2003          31 Mar 2003     Sep 2002
                                                       (unaudited)                       (unaudited)
                                                        £000             £000              £000

          Profit for the period                        2,815             5,387           2,767

          Dividends                                    (698)             (1,964)         (654)
          Net increase in shareholders' funds          2,117             3,423           2,113
          Opening shareholders' funds                  49,921            46,498          46,498
          Closing shareholders' funds                  52,038            49,921          48,611





5.                  The Directors are proposing an interim dividend of 1.60
pence (2002: 1.50 pence) per share payable on 9 January 2004 to shareholders on
the register on 12 December 2003.  The profit and loss account charge for
dividends reflects the adjustments for the interim and final dividends waived by
the Vp Employee Trust in relation to the shares it holds for the Group's share
option schemes.



6.                  Earnings per share have been calculated on 43,525,026 shares
(2002: 43,625,536) being the weighted average number of shares in issue during
the year. Diluted earnings per share have been calculated on 44,439,546 shares
(2002: 44,548,251).




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


                                                       Six months to 30  Six months to 30 Sep    Year to
                                                          Sep 2003              2002          31 Mar 2003
                                                         (unaudited)         (unaudited)
                                                            £000                £000             £000

       Operating profit                                 4,289              4,366                8,087

       Depreciation                                     5,395              5,049                10,282
       Amortisation of goodwill                         174                156                  318
       Profit on sale of tangible fixed assets          (482)              (665)                (1,738)
       Decrease / (increase) in stocks                  258                (117)                133
       Increase in debtors                              (1,810)            (2,147)              (1,473)
       (Decrease) / increase in creditors               (202)              1,290                1,035

       Net cash inflow from operating activities        7,622              7,932                16,644





8.                  Analysis of net debt (unaudited)


                                                As at          Cash flow    Acquisitions       As at
                                              1 Apr 2003                                   30 Sep 2003
                                                 £000            £000           £000           £000


Cash at bank and in hand                       3,330              (2,123)       -               1,207
Medium term loan                               (8,254)            70            -               (8,184)
Loan notes                                     (835)              560           -               (275)
Finance leases and hire                        (388)              331           (359)           (416)
purchase
                                               (6,147)            (1,162)       (359)           (7,668)





Other information



Comparative figures



The comparative figures for the financial year ended 31 March 2003 are not the
Group's statutory accounts for that financial year. Those accounts have been
reported on by the Group's auditors and delivered to the Registrar of Companies.
The report of the auditors was unqualified and did not contain a statement under
Section 237(2) or (3) of the Companies Act 1985.






Independent review report by KPMG Audit Plc to Vp plc



Introduction



We have been engaged by the company to review the financial information set out
on pages 6 to 10 and we have read the other information contained in the interim
report and considered whether it contains any apparent misstatements or material
inconsistencies with the financial information.



This report is made solely to the company in accordance with the terms of our
engagement to assist the company in meeting the requirements of the Listing
Rules of the Financial Services Authority.  Our review has been undertaken so
that we might state to the company those matters we are required to state to it
in this report and for no other purpose.  To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone other than the company
for our review work, for this report, or for the conclusions we have reached.



Directors' responsibilities



The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules which require that the accounting policies and presentation applied to the
interim figures should be consistent with those applied in preparing the
preceding annual accounts except where they are to be changed in the next annual
accounts in which case any changes, and the reasons for them, are to be
disclosed.



Review work performed



We conducted our review in accordance with guidance contained in Bulletin 1999/
4: Review of interim financial information issued by the Auditing Practices
Board for use in the United Kingdom. A review consists principally of making
enquiries of group management and applying analytical procedures to the
financial information and underlying financial data and, based thereon,
assessing whether the accounting policies and presentation have been
consistently applied unless otherwise disclosed.  A review is substantially less
in scope than an audit performed in accordance with Auditing Standards and
therefore provides a lower level of assurance than an audit. Accordingly we do
not express an audit opinion on the financial information.



Review conclusion



On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 September 2003.



KPMG Audit Plc

Chartered Accountants

Leeds

1 December 2003


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