Last checked at 11 Oct 2016 07:00
11 October 2016
("Norcros", the "Group" or the "Company")
Trading Update
Norcros, the market leading supplier of innovative branded showers, taps, bathroom accessories, tiles and adhesives will announce its interim results for the half year ended 30 September 2016 on 17 November 2016. In advance of this, the Group is providing the following trading update.
Trading
Group underlying operating profit1 in the first half is expected to be in line with the Board's expectations.
Group revenue for the first half is expected to be approximately £128.8m (2015: £118.7m), 8.5% higher than the prior year and 9.2% higher on a constant currency basis. The growth has been driven by the strong performances from our South African business and the recently acquired businesses.
Half year to 30 September 2016 | |||
| Reported | Constant currency | Constant currency LFL2 |
|
|
|
|
UK | 8.8% | 8.8% | -5.0% |
|
|
|
|
South Africa | 8.0% | 10.0% | 10.0% |
|
|
|
|
Group
| 8.5%
| 9.2%
| -0.2%
|
UK revenue for the first half was 8.8% higher than the prior year. On a like for like basis2 UK revenue was 5.0% lower than the prior year, consistent in the pre and post Brexit quarters. Market conditions softened post Brexit with the Group's second quarter performance illustrating the underlying resilience of its business portfolio. The Board continues to monitor activity levels and remains focused on improving performance through management action, self-help initiatives, excellent customer relations and investment in new product development.
The Board is pleased with the performance of our recent acquisitions. Abode has integrated well into the Group and performed in line with the Board's expectations in the six months since it was acquired. Croydex, acquired in June 2015, also continued to make good progress and recently launched a range of products through our South African retail outlets alongside a Vado branded brassware range.
Our South African business again delivered strong revenue growth in the first half of the year, 10.0% higher than the prior year on a constant currency basis and 8.0% higher on a reported basis, continuing the sustained progress of recent years.
Financial position
Closing net debt is expected to be around £28m (2015: £29.2m). Working capital and cash management remain a key focus for the Group.
Outlook
With the continuing strong performance of our South African business and the contribution from the recently acquired businesses offsetting the challenging UK market experienced in the first half, the Board remains confident that the Group will continue to make progress in line with its expectations for the year to 31 March 2017.
1 Underlying operating profit excludes IAS 19R administrative expenses, acquisition related costs and exceptional operating items
2 LFL / like for like excludes Abode first half revenues (acquired 31 March 2016) and Croydex quarter one revenues (acquired 25 June 2015)
ENQUIRIES:
Norcros plc | Tel: 01625 547 700 |
Nick Kelsall, Group Chief Executive |
|
Shaun Smith, Group Finance Director |
|
|
|
Hudson Sandler | Tel: 0207 796 4133 |
Nick Lyon |
|
Charlie Jack |
|
|
|
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 six 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
· Croydex - A market-leading, innovative designer, manufacturer and distributor of high quality bathroom furnishings and accessories
· Abode - A leading niche designer and distributor of high quality kitchen taps, bathroom taps and kitchen sinks
· 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 2,000 people. The Company is listed on the London Stock Exchange. For further information please visit the Company website: http://www.norcros.com