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Victoria's shares floored by mounting debts and falling profits

The flooring firm remains pretty highly levered, with net debts up 6% at £364mln, over triple the group’s earnings before interest, tax, depreciation and amortisation (EBITDA)

Victoria PLC -
Victoria supplied carpets for the wedding of Kate Middleton and Prince William in 2011

Victoria PLC (LON:VCP) shares faltered after the flooring firm reported lower half-year profits and mounting debts.

In its interim results on Tuesday, the carpet company said revenues rose 16% to £316mln but that underlying pre-tax profits reduced 2% to £27.5mln.

READ: Victoria splashes out £86mln for Spanish tile maker Saloni

Profits were squeezed by increased interest costs from its recent bond issue and the additional borrowings following the acquisition of Spanish tile-maker Saloni for £86mln last year.

In July, the company issued €330mln of bonds with a five-year life at a yield of 5.25%, to repay its existing bank loans, and allow it to continue its acquisition-led growth with August’s purchase of another Spanish tiler, Ibero-alcorense.

Victoria, which supplied carpet for the wedding of Prince William and Kate Middleton, remains pretty highly levered - net debt piled up 6% to £364mln, over triple the group’s earnings before interest, tax, depreciation and amortisation (EBITDA), which it said was due to adverse exchange rate movements.

Geoff Wilding, executive chairman, said that markets had been “challenging” for organic sales, with the Australian division seeing falling sales, but that “meaningful earnings” were contributed by the Saloni acquisition.

Shares were down 3.6% at 405p in mid-morning trading on Tuesday.

Quick facts: Victoria PLC

Price: 315 GBX

Market: AIM
Market Cap: £395 m

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