Victoria PLC (AIM:VCP) – we fear this one is bound to end in tears
The AIM quoted manufacturer and distributor of carpets which was the subject of a mighty boardroom tussle a few years ago has issued results for the full year ending 28th March 2015. The shares have had a terrific run over the past few years since and the valuation of this 100 year old carpet manufacturer looks now more akin to a high growth tech story. We acknowledge the creative approach adopted by the board to increase shareholder value over the past few years but question whether the current valuation justifies the hype
Headline results for the year showed revenue climbing from £128m from £71m, however this was largely due to the acquisitions of Abingdon Flooring group and Whitestone Weavers. Excluding acquisitions UK revenue grew a modest 1.5% and Australia was flat. Profit before tax and exceptional items was £6.97m and underlying profit before tax was £7.46m. Exceptional items included a non-cash charge of £7.55m relating to Contract for Differences entered between the Company and Executive Chairman Mr Wilding to encourage him “to generate significant value for all shareholders”. In summary Mr Wilding delivered handsomely to shareholders and was in turn handsomely…