A major Midland carpet firm has sunk into the red according to its first annual results after a bitter boardroom takeover.
Victoria Carpets in Kidderminster firm saw a £2.2 million profit from 2012 turn into a loss of £890,000, before tax and exceptional items, in the year to March 30.
Executive chairman Geoffrey Wilding, who was part of a group which seized boardroom power last year following a split which divided the family of the firm’s founder, said the “chickens had come home to roost” after years of being propped up by sales in Australia.
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The group saw revenue fall by eight per cent, to £70.9 million across the year, but said it was acting to reduce costs. The accounts also reveal a £2.6 million charge from exceptional items, which include £600,000 for the general meeting last October which saw boardroom power change hands, £230,000 for a new incentive plan and £870,000 for restructuring two Australian spinning mills.
Mr Wilding said: “2013 was the year when the chickens came home to roost at Victoria.
“Over recent years Victoria’s financial results have been sustained by overseas profits generated in a buoyant Australian economy. However, with a decline in the Australian market from early 2012, the underlying issues – poor execution of key strategies, failure to address the main issues facing the company, as summarised in the half year results, and a lack of focus on shareholder value by previous boards and management – were exposed.”
Mr Wilding said work was already taking place to address underlying problems, including minimising costs in the 海角视频, further job cuts in Australia and reducing stock levels.
He also said debts of £8.9 million when the new board took over last October were down to £7.5 million.
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He added: “These steps have not been without some pain – reflected in the exceptional items – but were essential for future value creation. Further progress is needed, and the drive to minimise costs never ends, but the Board believes a satisfactory start has been made.”
Mr Wilding became chairman after a consortium headed by Alexander Anton, a descendant of the founder if the firm, ousted a management team backed by other family members.
The row became bitter after accusations from supporters of the former board that Mr Anton tried to bring in a scheme to incentivise the break-up of the firm – which he denied.