Victoria confident about trading as it plans to capitalise on struggling competitors

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Victoria PLC (LON:VCP) said the upcoming one-month lockdown in England will make little material difference to its trading while it plans to capitalise on struggling competitors.

The flooring designer said it used the last six months to adapt its factories to enable production to be maintained whilst providing a Covid-safe environment, learning from its experience of the previous lockdown.

The AIM-listed manufacturer adopted measures such as health monitoring, social distancing, staggered shifts, PPE and education to enable full production schedules through another lockdown.

All its factories will remain open and continue to accept and deliver orders.

The firm said its liquidity position is strong and expects to continue to grow “at the expense of weaker competitors”, especially those with UK-centric businesses that do not generate a significant majority of earnings and cash from outside the country.

As a result, the board expects improved profits “as we capitalise on the decline of weaker competitors”.

Sales in the three months to October 3 recovered above pre-Covid budget and last year’s levels, with revenues rocketing 128% to £195mln on 2019 and a total cash burn of £7mln.

The quarter ended with cash and undrawn credit lines in excess of £200mln.

“In the UK, the new lockdown may subdue demand in the very short term but is likely to result in pent-up demand, particularly given that fitting capacity is being booked well into December,” analysts at house broker Peel Hunt commented.

“A key difference this time is that tradesmen can still access customers’ homes.”

Shares advanced 5% to 456p on Tuesday at the opening bell.

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