Van rental specialists Northgate endeared itself to the City with a sparkling set of half-year reports.

The Darlington firm recorded pre-tax profits up 16 per cent to £18.8m and turnover up 21 per cent to £164.8m on the back of six months full of progress and promise.

Fuelling the profitable period was the acquisition of Spain's second largest van rental firm, Fualsa, which contributed £0.5m to pre-tax profits in the first four months of ownership.

Chairman Michael Waring said: "Once again, by delivering on all of the key performance indicators, continuing to generate strong cash flow and maintaining fleet utilisation rates, Northgate has demonstrated the ability of its business model to thrive even in adverse economic conditions."

Anthony Platts, assistant director of Wise Speke, the North-East's largest stockbroker, supported Mr Waring's view.

He said: "Northgate has again produced a sparkling set of results, albeit in line with expectations.

"In 1999 the group announced a five-year Strategy for Growth management plan, with the target of 100 UK locations to successfully operate a 50,000 vehicle fleet.

"To date, with a fleet size of 44,900 vehicles operating from 70 locations as at the end of October, the company has achieved more vehicles per location than originally envisaged and as a consequence can operate a 50,000 fleet from a smaller number of outfits.

"This progress, through enhanced cash flow, will help reduce the level of operational gearing in the long term and allow opportunities to further grow the business.

"With a newly enhanced strong management team in place the company's future looks rosy."