Victoria PLC the Kidderminster-based international designer, manufacturer and distributor of carpets and floorcoverings has reported top line growth and like-for-like revenues gains across the Group continuing to be above three per cent.
Management remain confident that this growth is sustainable for the foreseeable future.
In the Group’s interim results released in November, Victoria advised it was taking advantage of difficult market conditions to actively pursue market share. The Board recognised this approach, which impacted earnings, unsettled some shareholders but believed it to be in the best long-term interests of the Group and its shareholders.
As a result, the Group has continued to grow overall like-for-like revenues and gain market share by winning new retailers as customers from competitors and securing a greater share of expenditure from existing customers.
Importantly, the various management actions to continue to grow operating margins are having the positive impact expected, the company reports.
Management expect to generate substantial positive cash flow in the 2020 financial year. The Group has, historically, consistently converted 85-95 per cent of operating profits into cash (before tax). Last year, with the focus on integration and productivity gains, the Group invested heavily in capital expenditure and reorganisational costs with new ceramic tile production lines installed in Ceramiche Serra and Keraben, the operational integration of Ceramica Saloni with Keraben, a new carpet backing line commissioned at its South Wales factory as part of the integration of UK manufacturing activities, and new warehouses opened across the UK to better service customers. With capital expenditure returning to normal levels and limited reorganisation anticipated, the 2020 financial year will achieve significant free cash generation, the company says.
Group Chief Executive, Philippe Hamers, said: “Over the last five years Victoria has steadily built what I believe to be one of the finest management teams in the industry and the value of this is demonstrated by the speed of execution and successful delivery of our productivity and margin improvement plan. Shareholders can be confident margins are steadily improving alongside continued market share growth.”
The Board of Victoria expect to announce the Group’s preliminary results for the year ended 30 March 2019 in July 2019.