Trading Statement

RNS Number : 5843P

Norcros PLC

03 October 2013

 



3rd October 2013

("Norcros", the "Group" or the "Company")

Trading update

Norcros, the market leading supplier of innovative branded showers, taps, bathroom accessories, tiles and adhesives, is pleased to issue the following update for the 26 week period ended 30^th September 2013.

Trading Overview

Group revenue for the 26 week period is expected to be in the region of £116m (2012: £106.3m) which represents year on year growth of 9.1% on a reported basis and 15.5% on a constant currency basis. On a like for like basis, excluding Vado which was acquired on 31 March 2013, revenue was 4.7% lower on a reported basis and 0.9% higher on a constant currency basis.  Group underlying operating profit¹ is expected to be approximately £6.8m (2012: £6.6m) and underlying profit before taxation² is expected to be approximately £6.0m (2012: £6.0m).

UK revenue for the period was 19.1% higher than last year, but on a like for like basis excluding Vado was 5.0% lower. Triton Showers recorded a better second quarter with revenue 11.9% ahead of last year, leaving revenue for the first half 1.4% higher than last year.  Revenue at Johnson Tiles was 11.4% lower than last year, with tough comparatives reflecting last year's initial stock orders for the B&Q tile range review exacerbated by current year destocking in a number of large retail customers. Johnson's UK trade sector and export business performed well in the second quarter with revenue up 1.7% and 17.9% respectively, leaving revenue at the half year higher than last year by 0.1% and 30.4% respectively.

Vado continues to trade well and although the comparatives are not included in our figures the business recorded growth of 14.0% in the period.

Our South African businesses have continued their strong growth with revenue 12.1% higher on a constant currency basis, with all three businesses contributing to this performance. A weaker Rand compared to last year means that on a Sterling reported basis revenue growth was 3.8% lower than the prior year.

Financial Position

Closing net debt is anticipated to be in the region of £29.5m (2012: £19.6m) and reflects the initial cash outflow of £10.6m associated with the acquisition of Vado on 31 March 2013. This is in line with expectations.

Outlook

The economic outlook in both South Africa and the UK is more positive in terms of construction activity and housing transactions, albeit this has yet to translate into a significant improvement in consumer confidence. Nevertheless, our South African businesses continue to deliver double digit constant currency growth, and we have experienced a stronger second quarter from both Triton and Vado. The destocking seen in Johnson Tiles UK in the first half, together with the second half weighting of cost reduction benefits will mean that Group underlying operating profit will be more heavily weighted to the second half than normal. The Board remains confident of the full year outcome.

¹ Underlying operating profit is defined as operating profit before exceptional items, amortisation of intangibles, and IAS19R pension administration costs,

² Underlying profit before tax is defined as profit before tax, exceptional items, amortisation of intangibles, IAS19R pension administration costs, and non cash finance charges.

ENQUIRIES:

Norcros plc	Tel: [phone]
Nick Kelsall, Group Chief Executive
Martin Payne, Group Finance Director
Hudson Sandler	Tel: [phone]
Nick Lyon
Charlie Jack
Katie Matthews

Notes to Editors

·    Norcros is a leading supplier of high quality and innovative showers, taps, bathroom accessories, ceramic wall and floor tiles and adhesive products with operations primarily in the UK and South Africa.

·    Based in the UK, Norcros operates under four brands:

·     Triton Showers - Market leader in the manufacture and marketing of showers in the UK

·     Vado - A leading manufacturer and supplier of taps, mixer showers, bathroom accessories and valves

·     Johnson Tiles - A leading manufacturer and supplier of ceramic tiles in the UK

·     Norcros Adhesives - Manufacturer of tile & stone adhesives, grouts and related products

·    Based in South Africa, Norcros operates under three brands:

·    Tile Africa - Chain of retail stores focused on ceramic and porcelain tiles, and associated products such as sanitary ware, showers and adhesives

·    Johnson Tiles South Africa - Manufacturer of ceramic and porcelain tiles

·    TAL - The leading manufacturer of ceramic and building adhesives

·    Norcros is headquartered in Wilmslow, Cheshire and employs around 1750 people. The Companyis listed on the London Stock Exchange. For further information please visit the Company website: http://www.norcros.com/

 

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