I have the iPad 4 with iOS 10.3.3 running VLC 3.1.2. I'm using ffmpeg to pipe m3u8 videos with tvheadend as my backend. The videos play perfect without any subtitles enabled, but the second I enable them the video begins to lag. The lag only occurs when a new subtitle string is displayed. The audio continues to play without any issues; however.
The PlayerXtreme and the OPlayerHD apps play the exact same video with subtitles without issue. I much prefer VLC player though, and I hope this can be corrected.