Victorian Plumbing Group (VIC) H2 2024 earnings summary

Executive summary

• Achieved group revenue of £295.7m, up 4% year-over-year, with order volume exceeding 1 million for the first time.

• Completed major warehouse management system transition and opened a new 544,000 sq ft Lancashire warehouse, supporting future growth and operational efficiency.

• Completed acquisition and closure of Victoria Plum, removing a key competitor, streamlining operations, and eliminating brand confusion.

• Outperformed the wider RMI market in revenue growth and continued to gain market share.

• Trade and adjacent categories (tiles, decor, lighting) showed strong growth despite previous warehouse constraints.

Financial highlights

• Gross profit rose 5% to £141.7m, with gross margin up 3 percentage points to 50%.

• Adjusted EBITDA increased 14% to £27.2m (9% margin), in line with expectations; like-for-like adjusted EBITDA was £29.4m excluding Victoria Plum losses.

• Adjusted EPS grew 13% to 5.3p.

• Proposed full-year dividend up 15% to 1.61p, with EPS covering dividend by 3.3x.

• Free cash flow increased 16% to £18.6m, maintaining robust conversion.

Outlook and guidance

• FY25 gross margin expected to remain close to current levels, assuming no change in consumer backdrop.

• Confident in delivering profit in line with full-year market expectations for 2025.

• Q1 2025 revenue up 3% year-over-year; December saw high single-digit growth as marketing normalized post-warehouse transition.

• Expansion categories and trade will be prioritized for growth, with increased marketing spend now more efficient post-competitor exit.

• Gross margin improvement expected to continue, though partially offset by wage and insurance cost increases.