Annual Report 2025 Report

Vp plc Annual Report and Accounts 2025

Head Office Vp plc

Central House Beckwith Knowle Otley Road Harrogate

Vp plc Annual Report and Accounts 2025

North Yorkshire HG3 1UD

Telephone: 01423 533 400

https://www.vpplc.com

Delivering value through specialist assets and solutions

Strategic Report

Corporate Governance

Financial highlights

Contents

Strategic Report

Financial highlights Group at a glance Our investment case Chair's statement Market review

Chief Executive's statement Operational review Business model

Operating model

Key performance indicators Financial review Stakeholder engagement Environmental, social and governance

Climate-related financial disclosures (TCFD)

Risk management Viability statement

Non-financial and sustainability

information statement

01

02

03

04

06

08

10

12

13

14

16

18

20

31

40

45

45

Corporate Governance

Board of Directors Governance at a glance Corporate governance report Nomination Committee report Audit Committee report Remuneration report Directors' report

Independent Auditors' report

48

49

50

54

56

59

74

77

Financial Statements

Consolidated income statement

Consolidated statement of comprehensive income

86

87

Consolidated statement of changes in equity Consolidated balance sheet Consolidated statement

of cash flows

Parent Company balance sheet Parent Company statement

of changes in equity

88

89

90

125

126

Shareholder Information

Five-year summary 139

Alternative performance measures 140

Directors and advisers 141

Financial Statements

Group revenue Adjusted profit before tax, amortisation, impairment of intangible assets and exceptional items1

For more than 70 years we have delivered for our customers - safely, efficiently, responsibly - with no short cuts or half measures.They trust us with exceptional requirements where complexity and constraints demand capabilities beyond the

ordinary.They rely on our specialist solutions to create and care for projects that allow economies to grow.

Adjusted basic earnings per share1

67.3p

74.8p

79.0p

2025

2024

2023

Return on average capital employed1

14.2%

14.5%

14.4%

2025

2024

2023

We focus on niche sectors, principally in the Infrastructure, Construction, Housebuilding and Energy markets, where our people lead through their knowledge and expertise.

Infrastructure

Construction

Dividend per share Net debt excluding lease liabilities

Statutory profit before tax Statutory basic earnings/(loss) per share

21.7m

£2.8m

£30.7m

Visit our corporate website

Housebuilding

2025

2024

2023

2025

36.6p

58.1p

2024 (13.4p)

2023

www.vpplc.com Scan the QR code

Energy

1 These measures are explained and reconciled in the Alternative Performance Measures section on page 140.

Vp plc Annual Report 2025 01

Group at a glance

When companies need specialist capabilities for critical projects they turn to us.

We are a reliable partner, ethical, sustainable and good to deal with. We are plain talking

Revenue by market Revenue breakdown by region

and straightforward, keeping our promises and only making claims we can support. Our customers stick and win with us, and our people are committed to building both our business and their own careers.

50%

6% 1% 2%

8%

83%

UK

Europe Australasia Asia

Other

70+ years

of heritage

83,500+

customers worldwide

£271.1m

net book value of property plant and equipment

£65.4m

investment in rental assets

Where we operate

United Kingdom

Ireland

Germany

0%

Infrastructure Construction Housebuilding Energy Other

Other includes sectors such as defence, aviation and facilities management

Hire fleet power types

46%

45%

9%

Electric/battery Diesel/petrol Non-powered

2,900+

200+

Australia

Employees

Branches

Malaysia and Singapore

and New Zealand

Key differentiators Financial profile

Why customers choose us

01

UK coverage with local leadership

04

Industry-leading safety experts

Market-leading specialist teams

02

05

Trusted by our customers

Young, fit-for-purpose hire fleet

03

06

09

Lower carbon solutions

Specialist assets, markets and delivery

• Deep understanding of market and assets drives strong customer loyalty

• High barriers to entry provides resilience

• Less susceptibility to general market trends

  Diversity in markets and geography

• Resilience of revenue streams

• Consistency of performance

  Exciting growth prospects

• Aligned to markets with significant growth potential and spend programmes

  Market leading returns

• Target ROACE of 15%

• Strong and consistent margins

  Balance sheet strength

• Young, well-maintained fleet

• Disciplined capital allocation

• Cash generative

  Progressive dividend

• 30-year+ uninterrupted dividend track record

• Long-term view

  07 08

  Fair pricing Assets, people and

  innovative solutions

  Easy access to specialisms

  • Geographies with strong growth prospects

  • Group-wide collaboration opportunities

02 Vp plc Annual Report 2025 Vp plc Annual Report 2025 03

Chair's statement

Our traditional

strengths of diverse market exposure and strong financial position will serve us well

as we continue to deliver sustainable growth and sector

leading returns."

Jeremy Pilkington

Chair

As we celebrate the 70th anniversary of Vp, I find myself inevitably reflecting on our history and the journey travelled to arrive where we are today.

When my father started the Company in 1954, the country was still recovering from the aftermath of WWII. There was, at that time, no motorway network in Britain and many of the iconic structures and buildings that we now take for granted simply didn't exist. Vibratory Roller & Plant Hire (Northern) Limited and its subsequent iterations,Vibroplant and Vp, played an indirect but significant part in the major national infrastructure projects over subsequent decades.

During the year we developed plans for Vp Rental Solutions (VpRS), a single point of access for customers who interact across a number of Vp divisions and our rehire supply chain. We subsequently launched this in April 2025 and while it is still early days, this looks set to simplify how we serve strategic customers, by building stronger relationships and enhancing the customer experience.

In October, we announced the acquisition of Charleville Hire and Platform Ltd (CPH), an Irish based specialist supplier of powered access equipment. CPH extends our footprint in the Republic of Ireland and provides the base from which we will

People

Always, our people have been our most valuable asset. We rely absolutely on their skills, experience and knowledge to deliver the right solutions to our customers.We are equally cognisant of our overriding responsibility to keep them and our customers safe.As part of our refreshed strategy, we are enhancing our divisional health and safety teams through the implementation of group-wide, streamlined processes.

We continue to take a pragmatic approach to ESG, embracing solutions that are commercially justifiable and add real value to the business.

Board

After over ten years as a Non-Executive Director, Phil White will retire from the Board in June 2025. On behalf of the Board, his colleagues throughout the Group and our investors, I wish to extend a heartfelt thanks to Phil for an outstanding contribution to the management and direction of the Company over this time. Many thanks, Phil.

In February 2025, we welcomed Richard Smith to the Board, an experienced FTSE 100 Chief Executive, formerly with Unite Group. We look forward with enthusiasm to working closely with Richard to bring his skills and experience to bear on the future growth of the Company.

One-stop-shop for rail customers

Dividend

The Board is proposing a final dividend of 28.0 pence per share (2024: 27.5 pence per share).Together with the interim dividend of 11.5 pence per share, this equates to a total dividend for the year of 39.5 pence per share (2024: 39.0 pence per share).

The proposed level of dividend is a balance between growth and dividend cover.Whilst acknowledging the temporary reduction in dividend cover, the Board supports modest dividend growth as a reflection of its confidence in the Group's future prospects. Dividend cover is expected to return to two times in the medium term.

Looking forward

We look to the future with measured optimism. Our established strengths in diverse market exposure and financial resilience will continue to benefit us in these turbulent times as we deliver sustainable growth and sector leading returns.

It remains my pleasure and duty to thank my colleagues throughout the Group for their commitment and hard work which has made the results possible.

Jeremy Pilkington

Chair

10 June 2025

As well as these physical achievements, an equally precious inheritance from this time was the culture that Geoffrey left as an enduring legacy to the business: directness, honesty, fairness and plain talking. These were his watch words and I hope

extend further in this buoyant market.

Results

I am overall pleased to report a resilient set of results for the year, despite ongoing challenges in some of our markets.

With end market focus a key part of our refreshed strategy, in 2024 we launched an integrated rail solution. Customers have direct access to all of the Group's rail specialisms through a one-stop-shop approach which has already been well received.

and I believe that he would recognise these characteristics

embedded today in the Group's DNA.

The business today is almost unrecognisable from my father's day but still embodies these fundamental principles. Markets change, customers change and we must change with them.

Eighteen months ago, under new leadership, we embarked on the most recent stage of that long journey. We have

refreshed our strategy and evolved a Group-wide focus on end markets to make it easier for our customers to do business with us.This will enable us to better access the significant opportunities presented by one-stop-shop bids. The first example of this new approach to market is Vp Rail, giving our rail customers easier access to the full range of Vp specialist expertise.

Infrastructure remains our most important and strongest market, with growing demand from the water and transmission sectors. Oil and gas exploration and development has also performed well. General construction activity is still somewhat subdued impacting the performance of some of our divisions, particularly Brandon Hire Station. Elsewhere, specialist construction has been more robust. The renewed national emphasis on housebuilding is welcomed and gives us more confidence in the future of the UK housing market.

Group revenue increased to £380.0 million (2024:

£368.7 million), while adjusted profit decreased to

£36.7 million (2024: £39.9 million). The Group's Return on Average Capital Employed remained broadly consistent at 14.2% (2024: 14.5%), while net debt increased to £138.5 million (2024: £125.2 million). Our strong balance sheet puts us in a good position to support continued investment into business opportunities.

We have made it easier for our customers to work and transact with us, through a single point of contact for project support, a central hire desk, and a streamlined quotation and invoicing process regardless of the size of the project.

We have a long history of working in rail, but in the past our customers have traded with individual business units.Torrent Trackside was typically the entry point for most customers but other parts of the Group - Groundforce, Brandon

Hire Station,TPA, ESS and UK Forks - also have specialist capabilities often used by rail customers. By creating Vp Rail, this has enabled us to offer an integrated package of services from across our divisions, including:

• On track products - small plant, clipping and stress, compaction, lighting solutions, people and support.

• Communications and survey - specialist services, training, safety, survey, test & measurement and communications.

• Shoring and piling support - shoring, piling, pile croppers, stoppers, bridges and training.

• Material handling and lifting - telehandlers, rotos, heavy lift telehandlers, electric machines and teletruks.

• Tools and equipment - ground maintenance, lighting, heating, cooling, breaking and fixing, on site power, site equipment and consumables.

• Rail, vehicle and pedestrian access - rail access, station works, vehicle access, pedestrian and self-install access.

Market review

Strategic Report

Corporate Governance

Financial Statements

What we do

Rail

We specialise in rail services, including major projects, track renewals and maintenance.We provide rail specific plant and tools and we offer operated plant services and maintain a 24/7 operational capability.

Water

We support the construction of pipelines, reservoir enhancements and sewer rehabilitation projects, as well as facility enhancements and treatment plant upgrades.We also provide specialist pipeline solutions and site access via portable roadways.

Transmission

We provide site access to transmission sites via portable roadways, as well

as services across survey, test and measurement and groundworks.

Market performance

Rail

In 2024, the UK rail industry underwent significant transformation, marked by the commencement of Control Period 7 (CP7) and Government reform.The start

of CP7, in April, marked a £44 billion investment plan focusing on climate change mitigation, performance improvement and support for passengers and freight. Key projects include the TransPennine Route Upgrade and continued development of High-Speed Rail 2. Despite these initiatives, the early stages of CP7 have experienced delays, with the Office of Rail and Road highlighting a £0.4 billion funding gap for England and Wales regions, with impact on core asset maintenance and renewal.

Water

In 2024, the UK's water and utilities sectors experienced notable developments, marked by record investments, financial restructuring and environmental challenges. Water companies in England and Wales announced plans to invest £14.4 billion during 2024 and 2025, the highest annual investment on record.This planned spend aimed to secure future water supplies and reduce sewage discharges into rivers and seas. 2024/25 was the final year in the AMP7 cycle and the upcoming AMP8 cycle represents a substantial increase with £104 billion spend in the five years to 2030.

Transmission

In 2024, the UK's electricity transmission sector witnessed enhanced grid capacity, integrated renewable energy sources and bolstered energy security.This includes projects such as the landmark development of the Eastern Green Link 2 project. Output across electricity specific construction is up 19% year-on-year across 2024, driven by carbon neutrality targets, with investments in new capacity and transmission lines. UK coal generation ceased in September 2024.The German transmission market saw significant investment to continue Germany's plans to expand and upgrade grids. A number of individual utility providers in the country

have seen investments increase up to 40% year-on-year, with this trend expected to continue, with an estimated €300 billion spend required by 2045 across the country.

What we do

We provide materials handling solutions, principally telehandlers and also small plant and equipment into residential housebuilding within the UK.

Energy

What we do

We support upstream projects with specialist pipeline services, infrastructure maintenance and well

testing. Additionally, we provide support for downstream projects, including industrial shutdowns and confined space monitoring solutions.

Market performance

Over the past 12 months, the UK housebuilding industry has faced a series of challenges and developments, marked by fluctuating construction activity, policy reforms and ongoing issues such as skills shortages and rising costs.This led to a reduction in net housing for the year 2024, with a 7% decline on the previous year.

Public sector housing initiatives have focussed on the remediation of existing housing stock, particularly with regards to cladding replacement, reducing the number of new dwellings built across the period.

The change in UK Government and subsequent changes in policy have delayed progress in the year, but provide optimism in the wider UK housing market over future years, with ambitious targets and policy reform.

Market performance

Global energy demand grew significantly in 2024, due to increased cooling demand, industrial consumption, transportation electrification and a rise in data centres and AI. UK production dropped by 5%, with oil and gas production reaching a record low.

Nuclear output was stable and production from wind, solar and hydro increased by 3%.

Geopolitical tensions contributed to market volatility. Countries have shifted their strategy from green energy to future energy security, including reassessing new offshore fossil fuel developments. Investment in energy supply and natural resources will reach record levels in 2025, up 6% in real terms. Capital investment will focus on power and renewables and upstream oil and gas projects.

What we do

General construction

We provide the general construction market with small plant, tools and equipment. Our offering caters

to a broad customer base with diverse needs.

Specialist construction

We support specialist construction with a focussed offering. Our services include support for site

redevelopments and repurposing with commercial fit out, as well as providing clean equipment for data centres and pharmaceutical facilities.

Market performance

General construction

Private non-residential construction output has declined 2% between 2023 and 2024, with factories, warehousing and retail all trending downwards against the prior year.

The general construction market has also been affected by contractor insolvencies, adding further strain and remains highly affected by increasing material prices, having increased by 35% since 2020, and ongoing labour and skills shortages.

Specialist construction

The pipeline of commercial fit outs of both new office space and refurbishments continues to be strong with double digit growth in 2024, this is especially prevalent in the London region with a number of significant projects ongoing including CitiBank and Google HQ.

Ireland continues to solidify its position as a global hub for pharmaceutical manufacturing, with several significant facility developments underway; these include Eli Lilly investment of $1.8 billion to enhance manufacturing capabilities.

Information source: Experian Information source: Experian

Vp plc Annual Report 2025 07