First-half revenue, earnings fall for Victoria

The AIM-traded firm said underlying revenue for the 16 weeks ended 28 September fell 9% to £568.8m, while underlying EBITDA dropped to £50.2m, from £92.7m in the prior year.

Statutory results showed a net loss after tax of £141.7m, swinging from a profit of £18.9m in the same period last year.

The company attributed the downturn to ongoing market pressures, including high interest rates, which had dampened demand.

However, Victoria said it made significant progress in cost reductions and operational efficiency.

It permanently cut £12m from its fixed cost base during the period, and said it was executing further annual savings of £20m, which would collectively enhance 2026 earnings by about £32m.

Victoria said its net debt stood at £658.2m, down from £695.6m year-on-year, with net debt-to-EBITDA increasing to 6.2x from 3.9x.

Despite the challenges, the company maintained access to its full production capacity, positioning it to meet future demand growth more efficiently.

The firm said it also gained market share in key regions and enhanced its competitive positioning through managing integration projects and cost-saving measures during the period.

It expected demand to normalise as interest rates stabilised, with anticipated volume growth of over 20% from current levels.

Each 5% increase in volume was expected to boost earnings by more than £25m.

“The long-term prospects for Victoria continue to be exciting and we believe we have a clear path to return to mid-high teen EBITDA margins,” said executive chairman Geoff Wilding.

“In the short term, even with subdued demand profits should begin to recover with the effects of the 'self-help' work undertaken to improve efficiency and take market share.

“In the medium term, as demand normalises, we are confident Victoria's revenue will recover and with the higher operational leverage now inherent in the business due to the integration projects and cost initiatives management have executed this year - and which are ongoing - we anticipate earnings increasing sharply with mid-high teen margins achievable.”

At 1016 GMT, shares in Victoria were down 2.4% at 45.87p.

Reporting by Josh White for Sharecast.com.