Victoria flags earnings in line with expectations amid cost-saving drive
Victoria
113.20p
17:15 07/01/25
Flooring company Victoria confirmed in an update on Wednesday that it expects earnings for the year ending 30 March to align with consensus market forecasts, despite subdued consumer demand.
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The AIM-traded firm said it anticipates stronger second-half trading, driven by management actions and a modest improvement in market conditions, echoing trends reported in its November interim results.
It highlighted the impact of ongoing cost-saving initiatives, which had already reduced the fixed cost base by £12m during the first half of the financial year.
Additional measures underway were expected to deliver annualised savings of £20m by year-end.
Those measures included reorganisations across Balta and Cali Flooring, integration of UK distribution and underlay operations, upgrades to Spanish ceramics equipment, and group-wide procurement efficiencies.
The combined measures were projected to add about £32m to 2026 financial year earnings, with cumulative savings exceeding £80m by 2027.
Victoria said it remained optimistic about medium-term growth, citing potential recovery in demand and its heightened operational leverage, which it believed positioned it to achieve EBITDA margins in the mid-to-high teens.
Additionally, the recent increase in housing transactions - a leading indicator of flooring demand - supported the board’s outlook for improved financial performance over the next two years, the directors said.
Separately, Victoria announced a change to its board, with Joe Scribbins joining as a non-executive director following the resignation of Blake Ressel.
Scribbins, a managing director at Koch Equity Development (KED), would replace Ressel, who was leaving KED to pursue other opportunities.
KED indirectly owns 10.96% of Victoria through its affiliate Wood River.
“Firstly, I would like to thank Blake for his contribution and support over the last four years, which have not always been easy, and wish him well with his future career,” said executive chairman Geoff Wilding.
“I am delighted to welcome Joe to the board of Victoria.
“His operational expertise and experience as the managing director of the commercial excellence team at KED will be invaluable as Victoria executes on several projects to maximise earnings and cash flow.”
At 0959 GMT, shares in Victoria were down 8.47% at 103.25p.
Reporting by Josh White for Sharecast.com.