Cleckheaton firm Victoria to continue to roll out the carpets despite virus

Carpet maker Victoria said the imminent second national lockdown will make little material difference to its trading performance as it has used the last six months to adapt its factories to enable production to be maintained whilst providing a Covid-safe environment.
Victoria executive chairman, Geoff Wilding,Victoria executive chairman, Geoff Wilding,
Victoria executive chairman, Geoff Wilding,

Victoria, which has a manufacturing site in Cleckheaton, West Yorkshire, said health monitoring, social distancing, staggered shifts, PPE, education, and other practises have been adopted throughout the group to enable full production schedules through another lockdown.

All of the firm’s factories will remain open throughout the lockdown and will continue to accept and deliver orders.

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Victoria said its management team, led by executive chairman, Geoff Wilding, intends to continue production throughout the next month, which is expected to minimise the impact of the lockdown on its UK business.

The group said its liquidity position is strong and it expects to grow at the expense of weaker competitors – particularly those with UK-centric businesses that do not have Victoria’s advantage of generating a very significant majority of earnings and cash outside the UK.

Mr Wilding said that while the group may not be as cash generative had the second lockdown not happened, the board expects improved profitability as it capitalises on the decline of weaker competitors.

Trading in recent months exceeded the board’s expectations, with sales for the three months to October 3 recovering to above both pre-Covid budget and last year’s levels.

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The firm said this favourable outcome is a result of people spending more time in their homes and working remotely.

It added that this trend is encouraging investment by consumers in home redecorating, as well as driving new home purchases.

It said it is premature to provide meaningful earnings guidance for 2021, although the board will update shareholders on November 30, with the publication of its interim results for the six months to October 3.

The group said it has maintained a strong liquidity position and finished the quarter with cash and undrawn credit lines of over £200m, up from £180m at the end of June.

Despite the lockdown in all of Victoria’s geographies in the June quarter, negative cash flow was just £7m for the three months.