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LONDON (Alliance News) - Norcros PLC Tuesday saw its shares slide, after it said group revenue from continuing operations for the 12 weeks to June 29 rose 0.9% on a constancy currency basis compared with a year earlier, but were 5.7% lower in actual sterling terms, reflecting a weaker South African rand.
Norcros shares were quoted down 3.8% at 17.33 pence Wednesday morning.
The supplier of branded showers, taps, bathroom accessories, tiles and adhesives said market conditions remain mixed for its UK businesses. It said revenue from the UK market was 1.4% higher than a year earlier. However export revenue was 13% lower, reflecting the timing of commercial projects in Vado outweighing good export growth in Triton.
"This left total revenue from our UK businesses for the 13 week period 1.6% lower than the same period last year," the company said.
Somerset-based Vado makes taps, mixer showers, bathroom accessories and valves, while Warwickshire-based Triton is well established in the power shower market.
Overall, Norcros said Vado recorded revenue growth of 18.5% in the UK over the 13-week period, while Triton saw revenue dip 2.6%.
However, the South African businesses did better with revenue up 6.2% on a constant currency basis. Nonetheless, a weaker rand saw reported sterling revenue fall 13% during the period.
The company said, given the continuing improvement in the financial performance of the UK and South African tile businesses and the expected recovery in Vado export revenues as commercial projects complete, it remains confident that the group will continue to make progress in line with market expectations for the current year.
Norcros also said Wednesday it has entered into a new committed GBP70 million unsecured revolving credit facility and a GBP30 million accordion facility through to July 2019 with three banks.
The company said two of the banks, Lloyds Banking Group PLC and Barclays PLC, are long standing lenders to the group, while HSBC Holdings PLC is a new partnership replacing Svenska Handelsbanken.
Norcros said the terms of the new arrangements provide the group with increased flexibility and will reduce net interest costs by approximately GBP200,000 a year based on current levels of net debt and leverage.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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