LONDON (Alliance News) - Floor coverings maker Victoria PLC said Tuesday its annual profit dropped amid acquisition-related costs, despite revenue rising sharply in "another record year" for the firm.
For the year ended March, pretax profit narrowed to GBP13.4 million from GBP18.8 million the year prior. This was despite revenue rising to GBP424.8 million from GBP330.4 million the year before.
Profit performance was hurt by a sharp rise in exceptional costs during the year. These rose to GBP27.4 million from GBP10.6 million the year prior. This was primarily driven by the jump in non-underlying administrative expenses to GBP22.4 million from GBP7.0 million the year before which was largely the result of acquisitions made in the period.
Underlying pretax profit - excluding exceptional costs - rose to GBP40.8 million from GBP29.4 million.
"Victoria saw another record year in 2018 and the group continues to go from strength to strength," Victoria Executive Chairman Geoff Wilding said. "In addition to focusing on increasing our top line, this was the fifth consecutive year of growth in underlying earnings per share, free cash flow, and operating margins."
Victoria does not currently pay dividend in order to keeps funds free to repay debt quickly and acquire further businesses, it said.
"The group continues to focus on growing in scale through acquisitions, with the completion of both Ceramiche Serra and Keraben Grupo during the year," Wilding added. "There remains an enormous market opportunity for Victoria to expand in the UK and internationally, by organically growing margins and enhancing earnings within our existing business, as well as by acquisition, where we believe opportunities will make a meaningful contribution to the group."
In November, Victoria acquired tile maker Keraben Grupo SA for EUR274.1 million. This followed in October the firm acquiring Italian ceramic floor maker Ceramiche Serra SpA for up to EUR56.5 million.
"Following a very good start to the year, the board looks forward to 2019 with confidence and to another successful year of continued growth and delivering real returns for its shareholders", Wilding continued.
Shares in Victoria were 1.1% higher at 835.00 pence on Tuesday.
Victoria (VCP)