Victoria chair puts ‘a lot of noise’ behind him but no ‘immediate’ turnaround
The exec chairman of carpet giant Victoria acknowledged a “lot of noise” around his company in a trading update this morning, as it attempted to put a fraud warning and cratering revenues behind it.
The Koch Brothers-backed firm – which owns a raft of flooring and carpet businesses across the world – was dragged over the coals last year after auditor Grant Thornton was unable to give a clean bill of health to one of its subsidiaries, Hanover Flooring Limited.
At the time Victoria said it had the issue under control and that there had been neither any wrong-doing nor loss associated with the concerns raised by Grant Thornton.
Perhaps more importantly for shareholders the firm also announced a pre-tax loss of £19.2m in the first half of 2024.
Shares in the AIM-listed firm, which owns Abingdon and Gaskell Mackay, are now worth less than half what they were this time last year.
This morning’s trading update on the 2024 fiscal year as a whole said revenues would be lower than in the previous financial year, and confirmed it had cut production staff by around 16 per cent.
Executive Chairman, Geoff Wilding, said: “There has been a lot of noise around Victoria in the last six months.
“We emphasise that we are not expecting some immediate improvement in flooring demand. However, we are confident of the impact on earnings and cashflow of management’s actions and are certain demand will inevitability revert to the long-term mean.”
The firm warned consumer demand continued to be “soft” in Europe – home to 39 per cent of the firm’s revenues – whilst “subdued but stable” conditions continued in the UKa nd Australia.
Despite the firm reporting rebounding demand in the US, labour inflation and cost pressures are eating into the bottom line, it confirmed.