LONDON (ShareCast) - (Sharecast News) - Floor coverings manufacturer Victoria saw shares drop on Monday morning after it reset its full-year profit estimates below market expectations.
Victoria told investors that underlying pre-tax profits would still be 35%-39% higher year-on-year, hitting the top end of its forecasts of around £56.7m, but well below City estimates of £67m.

The AIM-listed group carried on with its strategy of cutting prices in order to gain market share, something that had previously dismayed investors back in November when it warned full-year margins would be down by 1 to 1.5% against market forecasts.

Victoria stated that "almost all" of its efforts to improve margins had been successfully completed and now expects its strategy to "materially enhance earnings" in 2020.

However, Victoria did note the improvements had come "at a short-term cost" as it was forced to absorb "substantial" increases in raw materials prices and some large one-off costs stemming from the consolidation of its UK logistics operations.

Looking forward, Victoria said: "The actions that have been taken by the group's operational management are expected, as stated in November, to significantly increase EBITDA margins.

"Together with the upwards momentum of Victoria's revenues that the strategy has achieved, the board looks forward to a successful 2020 financial year."

As of 1015 GMT, Victoria shares had tumbled 13.26% to 374.70p.

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