Victoria PLC on Wednesday said it swung to a loss in the first half of its financial year, tracking falling revenue, although it stressed it is delivering against its strategy of margin enhancement.

Shares in Victoria were down 18% to 247.00 pence each in London on Wednesday morning.

In the six months that ended September 30, the Kidderminster, England-headquartered designer, manufacturer and distributor of flooring swung to a pretax loss of £19.2 million from a profit of £53.1 million a year earlier.

Revenue fell 16% to £648.5 million from £776.1 million.

Victoria PLC stressed it was delivering on margin enhancement, with underlying earnings before interest, tax, depreciation and amortisation margin improving 100 basis points to 14.9% compared to the second half of its financial 2023.

It said a key contributing factor to its margin improvement was relocation of significant manufacturing to Victoria’s ‘modernised’ UK factories, delivering ‘much-enhanced productivity, lower logistics costs and improved customer service’.

‘Our [first half] performance was in line with management expectations, with softer demand offset by higher margins beginning to come through from the reorganisation programme started 18 months ago,’ said Executive Chair Geoff Wilding.

‘The remainder of the year continues to look more challenging with ongoing lower demand maintaining pressure on top line sales, alongside inflation edging up raw material input costs.

‘Accordingly, the board now expects the resulting impact of these headwinds to slightly more than offset the [around] £20 million Ebitda benefit from the previously announced reorganisation programme. Nevertheless, thanks to the extensive reorganisation Victoria has undertaken over the last 24 months, the business is far better prepared to meet these challenges.’

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