Victoria (LSE:VCP), the flooring manufacturer, reported underlying revenue down 6% for the year ended 28 March, as a 9% volume decline in a markedly softer second-half market outweighed pricing gains.
The post-IFRS 16 EBITDA margin fell to 8.8% from 10.2% in the prior year, comparing against FY2025 figures restated in today's report.
The statutory operating loss reached £153.3m, and the statutory net loss after tax hit £326.3m, driven by non-cash impairments, one-off refinancing costs, a provision for the European rugs reorganisation, and finance costs tied to preferred equity.
Performance varied sharply by region: Australia delivered year-on-year growth in revenue and EBITDA on market share gains and cost discipline, while North America remained under pressure as the CALI business shifted from a consumer to a business-to-business model.
The company said it refinanced all debt maturing in 2026, and on 8 July announced a refinancing of its March 2028 bonds and KED Victoria Holdings' preferred shares, expected to extend maturities to 2031 and cut balance sheet liabilities by approximately £300m and annual finance costs by approximately £34m.
Holders representing over 90% of the 2028 bonds have acceded to the Transaction Support Agreement, clearing the threshold needed to implement it via consent solicitation.
Victoria said first-quarter trading in the new financial year showed volumes up approximately 3% and revenue up approximately 7%, with profitability ahead of the prior-year quarter despite cost volatility linked to the Iran conflict.
The group guided to at least £115m EBITDA for the 2027 financial year, reflecting market share gains offset by temporary margin dilution from higher input costs.
"Each 5% increase in volume is expected to contribute approximately £20 million to Victoria's operating profit", said Geoff Wilding, Executive Chairman, adding that pre-IFRS 16 EBITDA margins remain less than half the group's ten-year average.
News Intelligence what this means for the company
Victoria reported a £326.3m statutory net loss for the year to 28 March, driven by non-cash impairments, refinancing costs, and preferred equity finance charges, as underlying revenue fell 6% on a 9% volume decline in a weak second half. The company has refinanced 2026 maturities and announced a July refinancing extending 2028 bond maturities to 2031 and cutting annual finance costs by approximately £34m, while guiding to at least £115m EBITDA for FY2027 on the back of Q1 volume growth of approximately 3% and revenue growth of approximately 7%.
The refinancing removes near-term maturity pressure and materially reduces annual finance costs, but the company remains in a weak operational position: EBITDA margins at 8.8% are less than half the ten-year average, and the FY2027 guidance of £115m EBITDA assumes market share gains offset by temporary margin dilution from higher input costs. Q1 momentum is encouraging, but execution risk remains material given the scale of margin recovery needed.
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