Victorian Plumbing revenue dips as cost of living hits bathrooms
The retailer said it has grown market share after buying a rival, but turnover dipped as customers sought cheaper items.
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Your support makes all the difference.Victorian Plumbing’s revenue dipped in the first half as customers moved to order comparatively cheaper own-brand items amid the cost-of-living crisis.
The FTSE-listed group turnover fell 1% year-on-year to £144.6 million for the six months ending March 31, despite total orders growing by 2%.
The shift to own-brand products, combined with reduced shipping costs early this year, helped Victorian Plumbing widen its profits by 8%.
Meanwhile, a deal to buy rival Victoria Plum earlier this month for £22.5 million gave the group increased market share, despite a “subdued trading environment,” it said.
The May takeover comes just over six months after Victoria Plum plunged into administration and was bought in a so-called pre-pack deal by AHK Designs.
Victorian Plumbing said a cost-cutting plan was already underway at Doncaster-based Victoria Plum, given its recent administration process, including recent staff cuts.
It brings together the two long-standing rivals, which met in court over a trademark dispute eight years ago.
Separately, Victorian Plumbing said the upcoming completion of a new distribution centre in Lancashire will help it expand its business.
In its results statement, the company said as customers “continue to seek value” demand for “big ticket discretionary items” remains depressed.
However, looking forward, the company said it is seeing early signs of a slowdown in the customer shift to buy more own-branded products.
Chief executive Mark Radcliffe said the group had “increased profitability and consolidated our leading position as the UK’s number one bathroom retailer”.
“At the same time, we have embarked upon a year of transformational change with significant investment in our people, technology and operations.”
“Our new distribution centre, once operational, will remove space constraints, enabling us to deliver on our strategic plans in expansion categories and our trade proposition.
“Moreover, the recent acquisition of Victoria Plum represents another exciting strategic milestone and provides a unique opportunity to accelerate our growth.”