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Victoria PLC (VCP)

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Wednesday 21 April, 2021

Victoria PLC

Acquisitions

RNS Number : 0973W
Victoria PLC
21 April 2021
 

For Immediate Release

 

21 April 2021

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.

 

Victoria PLC

('Victoria', the 'Company', or the 'Group')

 

Acquisitions of Ceramica Colli, Vallelunga and Ceramiche Santa Maria

 

The Board of Victoria PLC (LSE:VCP), the international designers, manufacturers and distributors of innovative floorcovering is delighted to announce that it has concluded the purchase of the assets and business of ceramic tile distributors, Ceramica Colli and Vallelunga, and the shares of ceramic tile manufacturer, Ceramiche Santa Maria. Located near Victoria's existing Italian operations, t hese successful, growing brands also bring significant additional spare production capacity. As a result, they will not only provide an immediate earnings contribution to the Group in their own right, but will enable continued profitable growth at Victoria's already established Italian business through the utilisation of that spare production capacity.

 

These acquisitions follow Victoria's recent announcement of the very strong growth that has been achieved by the Group's Italian business. It has recently been operating at full capacity with some production again being outsourced to third parties in order to meet customer demand. We advised shareholders that Victoria was actively looking at opportunities to expand further our production capacity in Italy via a repeat of the highly successful February 2020 acquisition of the factory, plant, and brands of Ceramiche Ascot. The acquisitions announced today achieve that outcome, alleviating production constraints and giving Victoria's Italian business the opportunity for further growth.

 

T otal consideration (on a debt-free, cash-free basis) is c. €35 million and will be funded from the Company's existing resources. The acquisitions are expected to add not less than €10 million per annum of EBITDA in the next 12 months. Once full integration is completed, which is planned by the end of the financial year, the earnings contribution is expected to increase further. This increase will largely come from the insourcing of tile production that is currently outsourced due to lack of capacity, plus capitalising on the new brands to drive revenue growth.

 

 

Executive Chairman Geoff Wilding commenting on the acquisitions said

"International demand for the ceramic tiles produced by our Italian business continues to grow at a remarkable rate due to the successful blend of quality, style, and value. The use of a high proportion of recycled raw materials in the tiles has proven attractive to consumers. However, maintaining service levels for our customers has, in recent months, required the business to outsource production to third parties to meet the ever-increasing demand.  This is expensive in terms of margin forgone - and is addressed by this acquisition.

 

This is the first - and smallest - of several acquisitions we expect to conclude over the weeks and months ahead. Nevertheless, w e are delighted to have acquired these businesses, which are immediately earnings accretive, but will also enable our Italian business to continue its growth and create value for shareholders."

 

For more information contact:

Victoria PLC

Geoff Wilding, Executive Chairman

Philippe Hamers, Group Chief Executive

 

Michael Scott, Group Finance Director

+44 (0) 1562 749 610

 

N+1 Singer (Nominated Adviser and Joint Broker)

Rick Thompson, Phil Davies, Alex Bond

 

 

+44 (0) 207 496 3095

Berenberg (Joint Broker)

Ben Wright, Mark Whitmore, Tejas Padalkar

 

Peel Hunt (Joint Broker)

Adrian Trimmings, Andrew Clark

 

Buchanan Communications (Financial PR)

Charles Ryland, Chris Lane, Tilly Abraham

+44 (0) 203 207 7800

 

+44 (0) 207 418 8900

 

+44 (0) 20 7466 5000

 

About Victoria

Established in 1895 and listed since 1963 and on AIM since 2013 (VCP.L), Victoria PLC, is an international manufacturer and distributor of innovative flooring products. The Group, which is headquartered in Kidderminster, UK, designs, manufactures and distributes a range of carpet, flooring underlay, ceramic tiles, LVT (luxury vinyl tile), artificial grass and flooring accessories.

 

Victoria has operations in the UK, Spain, Italy, Belgium, the Netherlands and Australia and employs approximately 3,500 people across more than 20 sites. Victoria is the UK's largest carpet manufacturer and the second largest in Australia, as well as the largest manufacturer of underlay in both regions. 

 

The Group's strategy is designed to create value for its shareholders and is focused on consistently increasing earnings and cash flow per share via acquisitions and sustainable organic growth. (Further information about Victoria can be found on its website, www.victoriaplc.com.)

 

 

 

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