Slide 1: Interim Results for the period ended 30 September 2019
Interim Results for the period ended 30 September 2019 The Equipment Rental Specialist
Slide 2: Agenda
Agenda Strategic Aim and Highlights 1. Strategic Aim and Highlights 2. Market and Trading Review Market and Trading Review 3. Financial Review Financial Review Vp plc | The Equipment Rental Specialist | 2
Slide 3: Strategic Aim and Highlights
Strategic Aim and Highlights
Slide 4: Our aim is to create sustainable value
Our aim is to create sustainable value Strategic Aim and Highlights Resilient and First class proven model asset management Market and Trading Review UK & International Building on Specialist Rental core attributes Financial Review Vp plc | The Equipment Rental Specialist | 4
Slide 5: Market Leading Performance
Market Leading Performance Strategic Aim and Highlights Operating Revenue • Improved margins Margin • Sectors generally £186.6m 15.2% supportive Market and Trading Review • Softer UK construction • Market leading PBTA ROACE results £25.9m 14.5% Financial Review Vp plc | The Equipment Rental Speciali
Slide 6: Consistently strong returns and margins over the long term
Consistently strong returns and margins over the long term Strategic Aim and Highlights Profit before tax, amortisation Revenue and exceptional items £millions £millions 450 60 *391.6 400 382.8 50 *49.6 350 46.8 Market and Trading Review 303.6 40.6 300 40 34.9 248.7 250 208.7 29.8 30 200 150 20 193.
Slide 7: Results of this quality are only achievable because:
Results of this quality are only achievable because: ▪ Our fleet investment criteria is robust ▪ Customers value our expertise and consistent ▪ Change is embraced as a positive ▪ Key asset and operational performance measures have been ▪ We have an exceptional team of people embedded for years ▪ We
Slide 8: Market and Trading Review
Market and Trading Review
Slide 9: Key markets
Key markets Strategic Aim and Highlights Market and Trading Review Infrastructure Construction Housebuilding Oil & Gas Financial Review Vp plc | The Equipment Rental Specialist | 9
Slide 10: Market dynamics
Market dynamics Strategic Aim and Highlights Revenue Growth on H1 2020 (£m) H1 2019 (£m) prior year Market segment Infrastructure* 72.1 70.1 + 3% Construction 74.3 80.4 - 8% Housebuilding 16.8 17.5 - 4% Market and Trading Review Oil & Gas 12.5 14.9 - 16% Other 10.9 10.3 + 6% Total 186.6 193.2 - 3% *
Slide 11: Business performance – Group
Business performance – Group Strategic Aim and Highlights H1 2020 (£m) H1 2019 (£m) Revenue 186.6 193.2 - 3% PBITA 28.3 28.2 0% Market and Trading Review Operating margin 15.2% 14.6% UK Markets Mixed Margin Growth Another Strong Profit Performance Financial Review Vp plc | The Equipment Rental Speci
Slide 12: Business performance – UK
Business performance – UK Strategic Aim and Highlights H1 2020 (£m) H1 2019 (£m) Revenue 170.0 175.3 -3% Market and Trading Review PBITA 27.2 26.9 +1% Operating margin 16.0% 15.3% Water & Rail Brandon Hire Stable Regional Europe progress positive Station integration housebuilding construction - Grou
Slide 13: Business performance – International
Business performance – International Strategic Aim and Highlights H1 2020 (£m) H1 2019 (£m) Revenue 16.6 17.9 - 7% PBITA 1.1 1.3 -15% Market and Trading Review Operating margin 6.6% 7.3% Solid H1 for TR Airpac Bukom improving into H2 Progress in Malaysia & New Zealand Australia more subdued Financia
Slide 14: Rental fleet investment
Rental fleet investment Strategic Aim and Highlights H1 2020 (£m) H1 2019 (£m) UK 21.8 33.8 International 4.8 2.9 Market and Trading Review Total fleet investment 26.6 36.7 Disposal proceeds (10.8) (9.7) Net expenditure on fleet 15.8 27.0 UK capex reduced Brandon Hire Station fleet New fleet investm
Slide 15: Outlook
Outlook Strategic Aim and Highlights Market and Trading Review ▪ UK markets expected to remain relatively stable ▪ International markets broadly supportive ▪ UK infrastructure - new programmes ▪ Oil & gas – improving outlook ▪ Housebuilding steady ▪ Construction activity levels tied to UK political
Slide 16: Financial Review
vp, | ple Financial Review a!
Slide 17: Financial highlights – solid results
Financial highlights – solid results Strategic Aim and Highlights H1 H1 FY 2020 (£m) 2019 (£m) 2019 Revenue 186.6 193.2 - 3% 382.8 Market and Trading Review EBITDA 51.8 51.6 0% 101.4 Depreciation (23.5) (23.4) 0% (49.8) EBITA 28.3 28.2 0% 51.6 Interest (2.4) (2.3) (4.8) PBTA (and exceptionals) 25.9
Slide 18: Earnings per share and dividend per share
Earnings per share Strategic Aim and Highlights Dividend per share (pence) 35 30.2 30 H1 H1 26.0 Market and Trading Review 2020 2019 25 22.0 Dividend per share 8.45p 8.2p 20 18.9 Dividend cover 6.2 6.4 15 10 EPS adjusted * 52.5p 52.3p 5 8.45 6.8 8.2 5.35 6.0 0 Financial Review * Pre amortisation and
Slide 19: ROACE – quality of earnings
ROACE – quality of earnings Strategic Aim and Highlights 20 18 16.3% 16.0% 16 14.8% 14.5% 14.5% 14 Market and Trading Review 12 10 8 WACC 6 4 2 Financial Review 0 FY 2016 FY 2017 FY 2018 FY 2019 H1 2020 Vp plc | The Equipment Rental Specialist | 19
Slide 20: Balance sheet - strength
Balance sheet - strength Strategic Aim and Highlights H1 FY H1 2020 (£m) 2019 (£m) 2019 (£m) Property, plant and equipment 252.3 248.7 249.7 Market and Trading Review Intangible assets/goodwill 89.3 89.7 92.5 Net working capital 26.1 6.5 22.5 Other (6.0) (7.9) (9.7) Net debt (183.7) (168.1) (188.2)
Slide 21: Robust cash generation
Robust cash generation Strategic Aim and Highlights H1 H1 FY 2020 (£m) 2019 (£m) 2019 EBITDA 51.8 51.6 101.4 Market and Trading Review Cash from operations 26.5 35.5 92.7 Net capital expenditure (18.5) (29.3) (54.6) Interest and tax (9.6) (5.8) (12.8) Acquisitions (3.3) - - Dividends (8.7) (7.6) (10
Slide 22: Net debt and facilities – headroom
Net debt and facilities – headroom Strategic Aim and Highlights Facilities H1 FY 2020 (£m) 2019 (£m) RCF matures May 2020 65.0 65.0 Market and Trading Review RCF matures December 2021 135.0 135.0 Total RCF 200.0 200.0 Overdraft 7.5 7.5 Actual borrowing net debt 183.7 168.1 Headroom 23.8 39.4 Financi
Slide 23: Significant headroom against covenants
Significant headroom against covenants Strategic Aim and Highlights EBITA Interest Cover > 3 times Net Debt / EBITDA < 2.5 times 20.0 3.0 18.0 Market and Trading Review 2.5 16.0 15.24 14.0 13.00 1.89 2.0 1.78 12.0 11.35 11.21 11.02 1.62 10.0 1.5 1.45 1.39 8.0 1.0 6.0 4.0 0.5 Financial Review 2.0 0.0
Slide 24: Supplementary Schedules
Vp pic y ( Supplementary - Schedules &
Slide 25: Effective rate of tax reconciliation
Effective rate of tax reconciliation H1 H1 2020 (%) 2019 (%) Standard rate 19.0 19.0 Permanent disallowables 0.5 0.4 Chattels (0.4) (0.6) Prior year adjustments - (0.2) Non-qualifying depreciation and amoritsation 0.9 0.7 Overseas tax rate 0.1 0.4 CT / DT Rate Difference 0.1 0.2 Effective rate 20.2
Slide 26: Net Working Capital
Net Working Capital H1 2020 FY 2019 Acquisitions Cashflow movement £m £m H1 2020 Inventories 7.8 7.8 - - Trade debtors, prepayments, 88.0 80.4 0.5 (7.1) others Trade creditors, accruals, other (69.7) (81.7) (0.2) (12.2) Net working capital 26.1 6.5 0.3 (19.3) Capital creditors movement (1.1) Other c
Slide 27: IFRS16 impact on profit
IFRS16 impact on profit H1 2020 H1 2020 H1 2020 H1 2019 excluding IFRS IFRS impact Reported Reported EBITDA £m 51.8 13.0 64.8 51.6 PBITA (and exceptionals) £m 28.3 1.9 30.2 28.2 Financial expense £m (2.4) (2.1) (4.5) (2.3) PBTA (and exceptionals) £m 25.9 (0.2) 25.7 25.9 EPS (adjusted) pence 52.51 (0
Slide 28: Group history – 1954 to date
Group history – 1954 to date 2019 Acquisition of 2016 Sandhurst Acquisition of Higher Access 2014 and TR Pty 2007 Vp celebrates (Australia) MEP 60 years acquired 2005 2000 TPA and ESS UK Forks acquired 1996 division Cannon created Tool Hire acquired 2017 1982 Exit from Acquisition US powered USA of
Slide 29: Divisions
Divisions UK Rough terrain material handling equipment and tracked access platforms Excavation support systems and specialist products Portable roadway and temporary access solutions Tool and equipment hire Specialist safety, survey, communications and test measurement Mechanical, electrical and low
Slide 30: Central House, Beckwith Knowle, Harrogate
Central House, Beckwith Knowle Otley Road, Harrogate North Yorkshire, HG3 1UD T 01423 533400 www.vpplc.com Vp plc Company Number 481833