Full year results from the manufacturer of floorcoverings offered a prime example of the creative reporting now pervading company results. While the headlines spoke of a “sixth consecutive record year for Victoria” the reality was an abysmal year of exceptional costs, some of which should have been avoided. We can’t fathom why sensible investors continue to lap this up.
Shareholders in Victoria (LON: VCP) have had a roller coaster journey since chairman Geoff Wilding controversially took control of the business in October 2012. At the time chairman Wilding negotiated what some have described as ‘the deal of the decade’, magically engineering a 50% equity stake worth over £100m for a modest outlay of only £20,000. Mr Wilding has already cashed-in a good chunk of those magical gains, netting a tidy £41.3m in August 2018 following a sale of shares (the excuse at the time being to help satisfy institutional demand) to be added to the £29.5m of shares sold previously. His remaining 17.89% stake, held by his investment vehicle Camden House, is still worth over £100m at the current share price.
Mr Wilding has crammed his latest results statement full of superlatives: "Victoria achieved another record year in 2019 making it the sixth consecutive year of growth in underlying earnings; and free cash flow per share, and operating margins.” He even…
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Full year results from the manufacturer of floorcoverings offered a prime example of the creative reporting…