Victorian Plumbing signs up for new distribution centre

3rd Jan 2023 18:14

(Sharecast News) - Bathroom retailer Victorian Plumbing has signed an agreement to enter into a 20-year lease for a new, 544,000 square foot, purpose-built distribution centre in Lancashire, it announced on Tuesday, near to its existing operations.

The AIM-traded firm said the new centre was scheduled to be completed in autumn, and would become fully operational after a period of dual running with existing sites to ensure a smooth transition.

It said the distribution centre would support its strategic expansion, and would enable the consolidation of a number of its existing sites, although some existing facilities would be retained to enable further adjacent category expansion.

The group said it would invest in fitting out the centre through the current and next financial year.

Victorian Plumbing's board said the strategic investment would provide it with further operational capacity to support its growth, further strengthening its "market-leading" position.

A £50m right of use asset, together with a corresponding lease liability of the same value, would be recognised on the balance sheet, following completion of the fit-out.

After the initial period of investment and operational transition, cash outflows associated with this lease would be "broadly neutral" when compared to current property costs.

"This new facility represents another exciting milestone for the business, providing us with capacity to manage growth in the long-term while further establishing Victorian Plumbing's position as the number one bathroom retailer in the UK," said founder and chief executive officer Mark Radcliffe.

"I am also delighted that this new facility will create additional jobs and further support our investment in the local area."

At the close on Tuesday, shares in Victorian Plumbing Group were up 6.23% at 81.8p.

Reporting by Josh White for Sharecast.com.