TIDMVCP
RNS Number : 0813J
Victoria PLC
26 June 2017
For Immediate Release 26 June 2017
Victoria PLC
('Victoria,' the 'Company,' or the 'Group')
Significant Demand drives Manufacturing and Logistics
Reorganisation
and
Trading Update
Victoria PLC, (LSE: VCP) the international designers,
manufacturers and distributors of innovative flooring, today
announces that due to rapid growth and continued significant demand
for its products, it is reorganising the Group's UK manufacturing
footprint and logistics operations principally to increase
production capacity and improve service levels for customers.
Each of these positive developments will also progressively
improve margins for the Group.
Increasing manufacturing productivity
Given the significant expansion of the Group in recent years,
Philippe Hamers, the Group Chief Executive, has, following his
appointment in March 2017, reviewed the UK manufacturing footprint
with the goal of increasing capacity while improving production
efficiency. The reorganisation of the manufacturing capability,
which involves the transfer of manufacturing operations in
Kidderminster to the Group's two other UK carpet production
facilities, will:
-- Rationalise the Group's manufacturing operations to drive further incremental margin uplift.
-- Optimise asset utilisation and positively impact
manufacturing efficiency to provide significant - and much needed -
additional capacity without material capex.
The Kidderminster site will continue to operate with head
office, product development, and new warehousing and showroom
functions.
Strengthening of Group Logistics
As previously advised to shareholders, for the past eight months
the Group has, in conjunction with specialist consultants, been
reviewing its UK logistics network in order to improve margins for
the Group and enhance service levels for customers. These
objectives will be achieved with the reorganising and include:
-- Immediately relocating the current Midlands distribution
centre, which has become too small for purpose, into the Group's
Kidderminster site. This action will provide significantly
increased capacity.
-- Opening a Southern distribution centre to the North West of
London by late 2018, servicing all of the Group's brands, and
thereafter a further new distribution centre, in the North of
England.
Trading Update
The Board is pleased to announce that the Group continues to
trade well. Completion of the integration of recent acquisitions in
the UK, the Netherlands, and Australia, has ensured that the
Group's underlying profits before tax will be well ahead of last
year and the Board is confident of meeting market expectations for
the financial year ending 31 March 2018.
The Board believes Victoria is well placed for further growth
given its expanding international operations, which now represent
over a third of the business. In addition, reshaping the Group will
achieve meaningful cost and margin synergies, freeing up capital
for further domestic and international earnings enhancing
acquisitions.
Geoff Wilding, Executive Chairman, Victoria PLC commented:
"The successful growth of Victoria has enabled the Group to
reassess how best to utilise its manufacturing and logistics
capabilities. By reorganising our manufacturing and logistics
operations, we will continue to grow Victoria's earnings per share
and free cash flow.
"We have done this before, of course. Shareholders will no doubt
recall our manufacturing rationalisation in Australia in 2014,
which was highly successful with resultant revenue growth and
improvement in margins that have been very pleasing.
"Additionally, we remain confident that further significant
earnings-accretive acquisition growth, in addition to underlying
organic development, can be achieved to create further shareholder
value."
-Ends-
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
For more information contact:
Victoria PLC +44 (0) 1562 749 300
Geoff Wilding, Chairman
Philippe Hamers, Chief Executive
Michael Scott, Group Finance Director
Cantor Fitzgerald Europe +44 (0) 20 7894 7000
(Nominated Adviser & Broker)
Rick Thompson, Phil Davies, Michael Reynolds (Corporate
Finance)
Mark Westcott, Caspar Shand-Kydd (Sales)
finnCap +44 (0) 20 7220 0500
(Joint Broker)
Matt Goode, Carl Holmes (Corporate Finance)
Tim Redfern (Corporate Broking)
Buchanan Communications +44 (0) 20 7466 5000
Charles Ryland, Victoria Hayns, Madeleine Seacombe
This information is provided by RNS
The company news service from the London Stock Exchange
END
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