VAN hire group Northgate signalled further overseas expansion last night as it announced the acquisition of a Spanish company for £95m.

Darlington's only plc, which said it expects to turn over more than £500m next year, boosted its preliminary results yesterday with the announcement it had bought Record Rent, one of the largest van rental companies in Spain.

The company, which started more than 20 years ago as Noble Self Drive from its founder Alan Noble's home in Hurworth, near Darlington, could expand further into Europe.

It is now the leading van hire company in Spain and UK managing director Phil Moorhouse said tapping into the Spanish market would allow Northgate to look at the rest of Europe.

The company said yesterday that turnover had risen by 29 per cent to £458.3m and pre-tax profits had risen by 23.8 per cent to £55.6m.

Mr Moorhouse told The Northern Echo: "We have increased the fleet by 11 per cent in the UK to 52,600 vehicles and we have maintained our utilisation rates at 90 per cent which is a key measure for us."

In the past four years, Northgate has almost doubled the number of UK and Ireland locations to 80 and the company aims to further increase its fleet.

Northgate acquired another Spanish company three years ago in stages. It plans to integrate the two Spanish businesses.

Mr Moorhouse said: "What we saw when we went into Spain was a huge market that is relatively untapped.

"There are over three million white vans there and only two per cent of them are actually rented.

"Record Rent has 16 locations in Spain and 18,000 vehicles, and we are now well placed to develop the Spanish market further."

The company is putting together a strategic plan for the coming years which will be released in January, and Mr Moorhouse said Northgate would continue to expand in the UK.

The Spanish acquisition brings Northgate's worldwide employee numbers to 2,000, with about 350 across the North-East in its head office in Darlington and operations in Teesside and Tyneside.

Mr Moorhouse said the one problem Northgate was experiencing was a soft market for selling its used vehicles.

"We have seen a slightly softer residual market - basically the prices we get for our used vehicles have weakened in the last few weeks.

"We are still breaking even, but it's a problem across the board."