reports
- Paul Hill
Infrastructure & house building powering ahead
UK infrastructure is currently running at c. 40% above pre-pandemic levels (Source: ONS), driven by multi-year projects such as HS2, Hinkley Point & off-shore wind (re Transmission). These are all areas of expertise for specialist equipment rental, Vp. At the same time Vp has to content with the widespread material, labour & transport shortages, on top of surging input cost inflation. This is causing disruption for most operators, but as evidenced by today’s improvement in H1’22 EBIT margins ...
- Paul Hill
“In excellent shape” as the recovery continues
Vp, an equipment rental specialist who said today that it was “trading in line expectations and making excellent progress…. despite some areas (eg commercial property, outdoor events, oil & gas) still not back to historical norms. With H1 revenues coming in at 96% of pre-Covid levels (Est £179.1m vs £186.6m H1’20) vs 94% in H2’21 & 76% H1’21. Vp is not only tightly managing costs, but also materially enhanced its operating leverage (eg depot rationalisation) during the pandemic, and is “in exc...
- David O'Brien
Another significant increase in our estimates
Strong interim results, combined with good visibility on the outlook into Q1 2022, cause us to revisit estimates for the second time in as many months. A favourable outlook for Crestchic continues to be driven by a combination of strong data centre markets globally and, a return of large projects. The proposed disposal of Tasman is ongoing, with management engaged in discussions with third parties and an expectation that following its sale the Group will be debt free. A positive outlook is un...
- David O'Brien
Group hits strategic targets, our forecasts rise
The headline news associated with the pre-close H1 update is that strong trading at Crestchic, plus a positive order book, results in an upgrade to our estimates for FY21. Revenues improved by 22% at Group level to £19.6m (the highest level since H1 2014) and by 44% to £15.8m within Crestchic alone. The latter’s progress was led by sales into the data centre market but was widespread across several sectors. The outlook remains similarly impressive, particularly within Crestchic, and as a resul...
- David O'Brien
Good news at Crestchic and on refinancing
The trading update from Northbridge ahead of its AGM was positive, with activity levels within the core Crestchic loadbank division markedly higher YoY. Good order visibility into Q3 underlines their confidence in the outlook. The timetable to dispose of Tasman at a sensible price remains intact whilst work is expected to commence on the extension of manufacturing in Burton-on-Trent during Q3, adding 50% to capacity. Crestchic continues to build momentum, reflecting record orders, a return of ...
- Paul Hill
Upgrading forecasts as FY22 “starts strongly”
Today’s upbeat FY21 prelims from equipment rental specialist Vp provided further evidence of its industry leading status, especially in terms of earning quality, ROCE and cashflow. Posting a better than expected adjusted PBT (pre IFRS16) & diluted EPS of £23.3m & 45.9p on sales of £308m, alongside providing a “positive” outlook. Indeed in our opinion, the group’s through-cycle durability justifies a sector premium, thanks to its consistent returns, adoption of all-things digital and exposure to ...
- David O'Brien
Increased confidence and strategic review
Northbridge’s results for FY20 were in line with market expectations, showing both revenues and adj. PBT higher y-o-y despite the impact of the pandemic on trading. Of greater significance was news of a strategic review of the business, with the Board examining the disposal of Tasman, the Group’s oilfield services unit. The FY20 results showed positive trading momentum and cash generation with net debt falling to give a net debt/EBITDA of 0.9x. With the Group well advanced in negotiations with...
- Paul Hill
Construction boom coming down the track
Given Britain’s successful vaccine rollout, prospects have improved dramatically over the past 12 months, with Vp saying this morning that FY21 results were “in line with expectations”, and it exited the period on a run-rate of c.“95% of pre-Covid levels”. Despite “some sectors (eg events & hospitality) remaining closed and infrastructure (eg AMP7 and CP6) not yet fully up to speed”. We are forecasting FY21 adjusted PBT of £23.0m on sales of £299.6m – ending the year with £124m of net debt. Th...
- David O'Brien
Planning in place for further success
The CEO and founder of NBI, Eric Hook, has decided to retire from his Board position, although he will remain a strategic advisor to the Group. Eric also plans to remain a significant shareholder of the Group. The divisional leaders have overseen the growth and recovery of their divisions for several years, so no material changes on a day-to-day basis are expected as a result. The Divisional MDs and the CFO, Iwan Phillips, will report to the new Executive Chairman (previously NED Chairman), Pe...
- David O'Brien
Positive end to the year augurs well
The year-end close trading update from Northbridge IS confirms a second consecutive year of profitability, with estimates increasing in reflection of the strong end to the year. Tasman’s momentum seen in H2 19 and Q1 20 faltered in Q2 20 due to pandemic-related manning issues at rigs, albeit with a degree of recovery emerging in Q4 20. Crestchic performed strongly, particularly within manufacturing, with datacentre testing proving to be a strong market. We have increased our adj. PBT estimat...
- Paul Hill
Further progress and strong cash generation
Quality firms often use a crisis as a catalyst to streamline operations and improve services: not only building in downside resilience, but also winning market share as smaller rivals struggle. We think plant hire specialist Vp falls into this camp. Today saying that revenues had climbed from 55% of pre-Covid levels back in April, to 80% in July - and were now running at circa 85%. Not surprisingly though, the pace of recovery has softened due to recent Covid related conditions. They have pr...
- David O'Brien
Proving the doubters wrong
Proving the doubters wrong Northbridge’s results for the 6 months to June were most encouraging, with revenues falling just 4.5% and adj. PBT maintained at breakeven. While the pandemic reduced higher margin hire revenues, the performance of the Group’s North American operations represented particularly good news. Recovery commenced from August within hire and the strong manufacturing order book translated to revenues from Q2. We anticipate normal trading levels resuming from FY21. Despite h...
- David O'Brien
Cautious optimism
The H1 pre-close trading update from Northbridge suggests that H1 adj. PBT is likely to be broadly unchanged y-o-y at the breakeven level. This, however, masks a strong Q1 which mostly followed the positive trends seen in 2019 and a COVID-19 related downturn in Q2. Delays to longer-term projects may affect Q3 trading at Tasman, with recovery more likely from Q4. Crestchic sales and rental in advanced economies continues to perform well, with 2020 hire revenues likely to be impacted by reduced ...
- Paul Hill
Improving conditions with more to come
The UK Construction PMI literally dropped off a cliff at the start of the Covid-19 lockdowns. But since then there has been a gradual recovery, with June’s 55.3 reading (vs 28.9 in May) being above expectations (47.0), and the highest for 2 years. How is Vp performing? Well, after enduring a sharp -45% decline in April, trading has significantly improved with revenues “now running at >80% of prior year levelsâ€, driven by increased homebuilding, construction & infrastructure activity. An up...
- David O'Brien
Another encouraging update
NBI has issued a trading update covering the first 5 months of the year. Key points include an excellent y-o-y uplift in Q1 revenues and resilient trading during April and May. Management acted early to reduce costs, while cash flow proved strong. The outlook for H2 appears positive, reflecting a catch-up on delayed orders at Crestchic and contracts at Tasman. Net debt was broadly unchanged at £6.4m from the year-end, with the improved cash flows invested in a combination of capex and working...
- David O'Brien
Experience delivering results
Northbridge Industrial Services has issued an encouraging trading update that highlights: strength of demand for manufactured loadbanks (Crestchic); maintained factory production; strong liquidity; tight control of costs; continued deliveries/pick-ups within rental; a degree of uncertainly at Tasman regarding medium-term projects. Although trading had begun to dip by the end of March, overall the momentum built during 2019 continued. Significantly, the volume uplift within Tasman had resulted i...
- David O'Brien
Liquidity: plan B already underway
Northbridge has produced preliminary results that were ahead of expectations across several metrics. The Group achieved a significant milestone in returning to profitability for the first time in five years. Margins continue their upward trajectory, aided by the high levels of operational gearing. Geographical expansion continued, following the opening of new depots in Singapore (Tasman) and Pennsylvania (Crestchic). Reported cash flow continued to be positive, driven by a marked increase in E...
- David O'Brien
Well placed to deal with uncertainty
Northbridge has issued a trading update giving a degree of clarity ahead of 2019 results. Q1 trading has been strong in some areas (Crestchic manufacturing) and weaker in others, reflecting the limits on the movement of personnel and equipment across borders as nations struggle to contain the pandemic. However, we draw comfort from the experience of Northbridge in handling previous crises, a high NAV per share and expected rising demand for gas in Australia during Q2 and Q3. Together, they sug...
- Paul Hill
Safe harbour amongst COVID-19 storm
it is reassuring to hear a company continuing to deliver solid results, despite the considerable challenges. Today, specialist equipment rental firm Vp said that H2’20 trading had been “satisfactoryâ€. With softness in UK construction, particularly around London & the South East (pre/post the UK General Election) – being partly offset by infrastructure & housebuilding, which “held up wellâ€, reflecting low borrowing costs, good mortgage availability and the popular Help to Buy scheme. ...
- Paul Hill
An ideal stocking filler for patient investors
What do UK investors most want for Xmas? Well given the angst from the US/China trade spat, UK General Election and Brexit ‘limbo’, we suspect greater clarity would be towards the top of Santa’s list. The good news is that we think much of this uncertainty could be resolved over the next few months. Providing not only a welcome boost to capital investment, but also a lift to specialist plant hire firms like Vp - who this morning posted resilient 1st half figures, and said they were on tra...
Unfortunately, this report is not available for the investor type or country you selected.
Report is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.