Last checked at 4 Oct 2012 07:00
4 October 2012
Norcros plc ("Norcros", the "Group" or the "Company")
Trading Update
Norcros, the market leading supplier of innovative branded showers, tiles and adhesives, is pleased to issue the following update for the 26 week period ended 30th September 2012 in advance of the Group's half year results announcement on Tuesday 13th November 2012. Norcros also announces today that it has started a consultation process with UK employees with a view to closing the defined benefit section of its UK pension scheme to all future accrual from 31st March 2013.
Trading Overview
Group revenue for the 26 week period is expected to be in the region of £106m (2011: £102.4m) which represents year on year growth of 9.4% on a constant currency basis. Underlying operating profit1 is expected to be not less than £6.6m (2011: £6.3m), and underlying profit before taxation2 is expected to be not less than £5.9m (2011: £5.4m).
Our UK businesses have continued to face challenging markets but we are pleased to have delivered year on year revenue growth of 4.7% in the period.
Johnson Tiles recorded revenue growth of 17.0% in the period, driven by share gains in B&Q which has implemented a major tile range review and introduced a new in-store tile shop.
The UK shower market remains challenging with revenue at Triton 8.3% lower than the prior year for the period. UK revenue was 6.4% lower than the prior year, but represents continued market share gain. Encouragingly, second quarter UK performance improved and was 3.4% below the prior year compared to the first quarter which was 9.6% below the prior year. Export revenue, which is predominantly derived from Ireland and represents about 14% of overall Triton revenue, was 18.8% lower than the prior year reflecting continued general economic and Eurozone uncertainty. Again performance in the second quarter improved at 7.1% below the prior year.
Good progress has continued in our South African businesses and in particular in Johnson Tiles South Africa where management changes and operational improvements have improved financial performance. On a constant currency basis, South African revenue for the period was 17.4% higher than the prior year, although a significantly weaker rand means reported sterling revenue was 1.9% ahead.
Financial position
Closing net debt before prepaid finance costs is expected to be in the region of £21m (2011:£18.1m) with the increase being driven by the working capital investment required to service the increased level of business in Johnson Tiles UK.
Pension
Norcros has today started a consultation process with its UK employees with a view to closing the defined benefit section of its UK pension scheme to all future accrual from 31st March 2013. As part of this process a new, auto enrolment compliant defined contribution scheme will be introduced from 1st April 2013.
Outlook
The outlook for both our UK and South African markets remains challenging but nevertheless the Board remains confident that through the ongoing programme of growth initiatives and self help actions Norcros will continue to make further progress.
1 Defined as Group operating profit before exceptional items and other operating income
2 Group profit before tax, exceptional items, and non cash finance costs
ENQUIRIES:
Norcros plc | Tel: 01625 547 700 |
Nick Kelsall, Group Chief Executive | |
Martin Payne, Group Finance Director | |
Hudson Sandler | Tel: 0207 796 4133 |
Nick Lyon | |
Charlie Jack | |
Katie Matthews |
Notes to Editors
·; Norcros is a leading supplier of high quality and innovative showers, ceramic wall and floor tiles and adhesive products with operations primarily in the UK and South Africa.
·; In the UK, Norcros operates under three brands:
·; Triton Showers - Market leader in the manufacture and marketing of showers in the UK
·; Johnson Tiles - A leading manufacturer and supplier of ceramic tiles in the UK
·; Norcros Adhesives - Manufacturer of tile & stone adhesives, grouts and related products
·; 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, industrial and building adhesives
·; Norcros is headquartered in Wilmslow, Cheshire and employs around 1600 people and is listed on the London Stock Exchange.
·; For further information please visit http://www.norcros.com