Harrogate’s Vp cuts 150 jobs, consolidates branches

Harrogate-based equipment rental group Vp plc said in a trading update on Tuesday it has cut around 150 jobs and closed or merged 17 branches across its UK and international operations amid the downturn in trading caused by the Covid pandemic.

“Group revenues have continued to improve, although the initial impact from the re-opening of existing sites has slowed and the business has become more reliant on new projects starting,” said Vp.

“Group revenues are now running at circa 85% of pre-Covid levels.

“In response to the downturn in trading, the group initially mothballed about 120 locations but we are pleased to report that over 100 of those are once again fully operational and are responding to the growing demand from our customer base as they themselves have returned to work. 

“However, the re-alignment of capacity to better reflect current levels of demand has required us to merge or close 17 branches and regrettably make approximately 150 positions redundant across our various businesses, in the UK and internationally.  

“The costs of these branch closures and the redundancies will be recognised as an exceptional charge in the current financial year ending 31 March 2021.

“The group has continued to demonstrate excellent cash management and net debt has reduced further to £118.7 million at 30 September 2020, which compares with £159.7 million at 31 March 2020, an improvement of £41.0 million.  

“A sustained period of strong cost control, reduced capital expenditure and excellent working capital management has delivered this impressive net debt improvement.

“Markets are generally stable and infrastructure work, in particular, should be supportive as the likes of the AMP7, HS2 and Hinkley Point programmes start to gain momentum. 

“We do however remain slightly cautious with regard to the short to medium term prospects as we await evidence of a recovery in confidence and the commencement of new projects. 

“In addition we also remain conscious of the fact that the Covid pandemic is yet to be fully under control.

“The longer term outlook for the group remains positive and we are proactively identifying organic growth opportunities, focused particularly within those of our businesses already achieving pre-Covid levels of trading.”