Victorian Plumbing Falls, Dunelm Loans and Parties

I commented negatively on Victorian Plumbing (VIC) back in June soon after it launched an IPO at 262p. After an initial spurt upwards in the share price it’s now at less than 100p. It has recently published it’s annual results which look positive if you take them at face value – revenue up 29% and adjusted EBITDA up 53%. But in reality the story is more complex with reported pre-tax profit down 17% and there are mixed messages about future prospects. It should remind everyone of the danger of investing in new IPOs.

Another item of news today was from Dunelm (DNLM) who have negotiated a new bank facility and the odd thing is that it has various “sustainability” conditions. Does this mean that banks will not lend you money in future unless you commit to reducing your greenhouse gas emissions, source your cotton products from responsible sources, reduce your plastic packaging and provide a customer “take-back” service. These are all commitments made by Dunelm which will be verified by an independent third party.

As an investor in Dunelm, I consider it quite unreasonable that banks should be trying to interfere in the management of companies in this way. Some of the objectives may be meritorious but it is surely for the company to decide on such matters, not bankers.

I don’t normally comment on the trivia of political grandstanding but the recent media publicity about alleged parties at No.10 Downing Street and redecoration of the Prime Minister’s flat is exasperating. Have politicians not got more important things to argue about?

And why should we put up with media being dominated by such stories when they should be covering more important news?

Attacking Boris Johnson for events he did not even attend and neither did other Ministers makes no sense. The alleged party happened a year ago so it’s ancient history in political terms and perhaps some junior staff should be warned not to do it again if there is real evidence of wrong-doing (which is unclear). But the Prime Minister should not be wasting his time on such trivia. Allegations he was being untruthful make no sense either as clearly he was relying on information given to him by others.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

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