Vp plc delivers resilient performance and maintains dividend despite tough market

Vp plc FY2026 results: resilient trading, but profits took a clear hit

Vp plc has delivered what I’d call a solid-enough set of results in a difficult market, but there is no getting away from the fact that earnings moved backwards. Revenue fell 5.7% to £358.3 million, while adjusted profit dropped 26.4% to £27.0 million. Statutory numbers were much uglier, with the group swinging from a £21.7 million profit before tax to a £7.0 million loss before tax.

The reason that gap matters is simple. On an underlying basis, Vp is still profitable. On a statutory basis, the big Brandon Hire Station restructuring has done real damage this year.

That leaves investors with two competing messages. The positive one is that the business is still generating cash, still investing, and still paying the dividend. The negative one is that parts of its UK market, especially general construction, remain weak and the turnaround has been expensive.

Vp plc key figures from the 2026 final results

Metric	FY2026	FY2025	Change
Revenue	£358.3 million	£380.0 million	(5.7)%
Adjusted profit	£27.0 million	£36.7 million	(26.4)%
Adjusted EBITDA	£78.0 million	£90.6 million	(13.9)%
Adjusted basic EPS	54.5p	66.8p	(18.4)%
Statutory EPS	(13.8)p	36.6p	>(100)%
Net debt excluding lease liabilities	£148.9 million	£138.5 million	7.5%
Full-year dividend	39.5p	39.5p	No change

Why Vp’s adjusted profit and statutory loss tell two different stories

This is one of those results where the adjusted figures and the statutory figures paint very different pictures. Adjusted profit before tax was £27.0 million, which management says was in line with previously revised guidance. But exceptional items totalled £30.6 million, pushing the group into a statutory loss.

The biggest issue was Brandon Hire Station. The restructuring and reorganisation bill came to £20.9 million, while impairment charges on property, plant and equipment and right-of-use assets were £5.1 million. There was also a £4.6 million exceptional charge linked to contingent remuneration on the CPH acquisition.

In plain English, Vp has taken a big one-off hit to shrink and reshape part of the business. That is painful today, but the company is arguing it should improve margins and asset utilisation in future years.

Brandon Hire Station restructure: painful now, but probably the right call

This is the most important strategic move in the whole announcement. Brandon Hire Station has been restructured from a broad footprint business with consumer exposure into a tighter business-to-business specialist trade operation.

• Branch network reduced from 119 to 41
• Headcount reduced by around 400
• Rental fleet reduced by approximately 40%
• Expected cash payback period of 4 years

My take? This looks harsh, but sensible. General construction has been weak, and management has decided to stop chasing lower-quality consumer and DIY demand where returns were not good enough.

The concern is that restructurings do not always go perfectly after the announcement date. But Vp says the programme was completed on time and as planned by March 2026, which is encouraging. Total cash outflows are now expected to be £21.1 million, of which £10.5 million happened in the year and a further £10.6 million is expected in future years.

International growth was the bright spot in Vp’s 2026 results

If you want the good news, it is overseas. International revenue rose 14% to £71.2 million and adjusted operating profit jumped 30% to £12.6 million. That is a strong result and shows the investment outside the UK is doing what it was supposed to do.

The CPH acquisition made in October 2024 contributed a full year this time round, which helped. Vp also pointed to growth in transmission projects in Germany and activity across new countries in Africa, South America and the Middle East within Energy.

By contrast, the UK segment was the weak spot. UK revenue fell to £287.1 million from £317.6 million, while adjusted operating profit dropped to £24.6 million from £37.4 million. That is a big downgrade and tells you exactly where the pressure is.

End markets update: infrastructure steady, construction still tough

Vp’s market commentary was mixed, but not dreadful. Infrastructure, transmission and rail were described as steady. Water was weaker during the transition from AMP7 to AMP8 – that is the move between regulated five-year water investment periods – but the company expects activity to improve as AMP8 develops.

Specialist construction performed well, while general construction remained challenging. Housebuilding and Energy were described as satisfactory, though housebuilding was still below expectations.

That all fits the wider picture. Vp does better where technical kit, specialist know-how and long-term infrastructure spending matter more than the basic cycle of UK building activity.

Vp dividend maintained at 39.5p – reassuring, but cover has weakened

Income investors will focus on the dividend, and here Vp has held its nerve. The proposed final dividend is 28.0p, making 39.5p for the full year, unchanged from FY2025. That also extends a 30-plus year uninterrupted dividend track record.

That said, dividend cover has fallen to 1.4 times from 1.7 times. Dividend cover is simply how many times earnings cover the payout. Higher is safer.

So yes, the unchanged dividend is a vote of confidence by the board. But it is not cost-free. If trading does not improve, that cover remains tighter than ideal.

Balance sheet, debt and cash flow: still controlled, but not getting easier

There is no balance sheet panic here. Net debt excluding lease liabilities increased to £148.9 million from £138.5 million, but the company says leverage is below its stated target of 2x. The exact leverage ratio was not disclosed in the headline section.

Operating cash flow came in at £61.4 million, down from £80.7 million, mainly because profit fell. Even so, Vp still invested £51.6 million in rental fleet during the year, which tells you management is not retreating.

Funding also looks sensibly managed. The revolving credit facility has been extended and then increased post year-end from £90.0 million to £120.0 million. Vp has also lined up new private placements of €38.0 million and £15.0 million ahead of a £65.0 million maturity in January 2027.

Vp outlook for FY2027: better than FY2026, but not exactly booming

The company is still cautious. It says UK construction activity remains sluggish, but expects year-on-year improvement in FY2027 from the Brandon restructure, digital investment and stronger infrastructure demand.

Importantly, trading for the new financial year is expected to be in line with market expectations. The company quoted analyst consensus for FY2027 of £352.1 million revenue, £33.1 million adjusted profit and pre-IFRS 16 net debt of £150.8 million.

That implies analysts are expecting profit recovery even if revenue stays a bit soft. In other words, the market will want proof that the reshaped business can earn better margins from a leaner base.

What these Vp plc final results mean for retail investors

My overall view is cautiously positive. These are not pretty numbers on the surface, but they are more credible than a business pretending nothing is wrong while returns drift lower. Vp has confronted the weak part of the portfolio, protected the dividend, and kept investing in better-quality areas.

The bull case is straightforward: infrastructure exposure, strong international momentum, a completed restructuring, and a business that should emerge leaner and more profitable. The bear case is just as obvious: the UK market is still tough, debt is higher, dividend cover is tighter, and the turnaround now has to prove itself in the numbers.

For me, this result matters because it feels like a reset year. FY2026 was about taking the pain. FY2027 now needs to show the benefits.