Victoria PLC Acquisitions (0973W)

TIDMVCP

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. EUR35 million and will be funded from the Company's existing resources. The acquisitions are expected to add not less than EUR10 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       [phone] 
 
   N+1 Singer (Nominated Adviser and Joint 
   Broker) 
   Rick Thompson, Phil Davies, Alex Bond        [phone] 
  Berenberg (Joint Broker) 
   Ben Wright, Mark Whitmore, Tejas Padalkar 
 
   Peel Hunt (Joint Broker)                    [phone] 
   Adrian Trimmings, Andrew Clark 
                                                [phone] 
   Buchanan Communications (Financial PR) 
   Charles Ryland, Chris Lane, Tilly Abraham    [phone] 
 
  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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April 21, 2021 02:00 ET (06:00 GMT)