6th Nov 2013 11:16
LONDON (Alliance News) - Floor coverings company Victoria PLC Wednesday said it swung to a profit in the first half of its financial year, as cost cutting offset a decline in revenues.
The maker of carpets and carpet tiles reported a pretax profit of GBP86,000 for the six months to September 28 compared with a loss of GBP1.5 million a year earlier as it cut distribution costs and administrative expenses by more than GBP1.5 million. Revenues slipped to GBP34.5 million, from nearly GBP36 million.
It also managed to slash its debt to GBP2.97 million, a decrease of GBP4.54 million over the six month period.
It kept its interim dividend unchanged at 2 pence.
"A considerable amount of work has been done to remove unnecessary cost from the business and improve the group's working capital position, although more remains to be done before the group starts to deliver acceptable results," Chairman Geoff Wilding said in a statement.
The company, which operates in the UK and Australia, was hit by the economic downturn, and has been taking steps to improve profitability. It is now focusing on margins rather than selling product at any cost, even though that will likely impact sales. It has also lowered stock levels, freeing up money it can put to use.
It said the market outlook continues to be mixed, with wool costs up and consumer demand for carpets still weak despite a recent improvement in consumer sentiment.
Victoria shares were down 0.3% at 1.092 pence Wednesday morning.
By Steve McGrath; [email protected]; @SteveMcGrath1
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