Flooring manufacturer Victoria Plc (LON:VCP) surprised investors with stronger-than-expected results on Tuesday, causing shares to rise nearly 5 percent.
In a positive trading update, the company’s board said it expects underlying profits before tax to be “comfortably ahead” of current consensus market expectations for the financial year ending 1 April 2017.
Recent acquisitions in the UK and Australia both significantly benefitted the group’s performance during the period, “positively impacting gross profit margins and overheads throughout the current financial year.”.
The company added that further improvements are expected in the coming financial year saying it had “invested a significant amount of time and energy during the past year identifying further suitable acquisition opportunities within Victoria’s existing markets and, importantly, Europe”, as it looking to expand further.
Shares rose nearly 5 percent immediately after the news, helped by analysts at Cantor Fitzgerald reiterating their buy rating on the stock.
Cantor Fitzgerald are forecasting full-year pretax profits of £28 million, representing 54 percent year-on-year growth. In a note to clients, they said: “After rising 28 percent YTD Victoria trades on a Mar’18 PER of 15.2x. We continue to believe this represents good value given the forecast 3 year EPS CAGR of 25 percent and the potential for further earnings enhancing acquisitions.”
Shares in Victoria are currently up 3.41 percent at 470.50 (1609GMT).