Last checked at 13 Oct 2022 07:00
13 October 2022
Trading Update
Norcros plc ("Norcros" or the "Group"), a market leading supplier of high quality and innovative bathroom and kitchen products, will announce its interim results for the 26-week period ended 2 October 2022 on 9 November 2022. In advance of this, the Group is providing the following trading update.
Trading
The Group has delivered a robust H1 performance reflecting the strength of our customer proposition and the breadth of our distribution channels.
Group revenue for the 26 week period is expected to be at record levels at approximately £220m (2021: £200.9m 2020: £135.3m; 2019: £181.2m), 10% higher on a reported basis than the previous record prior year comparator (1% higher on a constant currency LFL1 basis) and 20% higher than the pre-pandemic comparator of 2019 on a constant currency LFL1 basis.
H1 LFL1 revenue increase/(decrease) on | ||
| 2021 | 2019 |
UK | (3%) | 14% |
South Africa | 10% | 22% |
South Africa (at CC2) | 10% | 32% |
Group | 1% | 17% |
Group (at CC2) | 1% | 20% |
In our UK business, LFL1 revenue for the first half was 3% lower than the previous year, albeit 14% higher than in 2019. Our performance in the trade channels remains resilient offset by softer demand in the retail channels and destocking in some of the larger retail customers.
Following its acquisition on 31 May 2022, Grant Westfield has been integrated into the Group and continues to perform strongly in line with the Board's expectations.
Our South African business has continued to outperform the market, with revenue for the first half 10% higher than prior year on a constant currency basis. Revenue was also 32% higher than in 2019 on a constant currency LFL1 basis, with growth across all divisions reflecting market share gains.
Financial Position
The balance sheet remains strong with net debt of approximately £60m (pre-IFRS16) following the acquisition of Grant Westfield and is in line with the Board's expectations (net cash of £8.6m as at 31 March 2022). The Group has committed banking facilities of £130m maturing October 2025.
Pension Scheme
Notwithstanding the recent volatility in financial markets, and in particular the movement in gilt yields, the Group's UK defined benefit pension scheme obligations continue to be well managed and we expect the scheme to continue to be in an accounting surplus as at 30 September 2022.
Outlook
Our performance in the first half of this financial year continues to reflect the strength of our focussed operating model, market leading brands, broad distribution channels, well-developed supply chain infrastructure and stock availability. We expect to report an underlying operating profit in the first half of the year of no less than £21m (2021: £22.0m, 2020: £12.8m, 2019 £17.4m).
Notwithstanding the ongoing macroeconomic uncertainties, the Board remains confident that the Group will continue to win share and perform in line with the Board's expectations for the year to 31 March 2023.
1. LFL (like for like) adjusts 2019 revenue from a 27 to a 26 week period pro-rating and excludes Grant Westfield, which was acquired on 31 May 2022
2. CC refers to constant currency basis
Enquiries
Norcros plc | Tel: 01625 547700 |
Nick Kelsall, Chief Executive Officer | |
James Eyre, Chief Financial Officer | |
Hudson Sandler | Tel: 0207 796 4133 |
Nick Lyon Sophie Miles | |
Notes to Editors
Norcros is a market leading supplier of high quality and innovative bathroom and kitchen products with operations primarily in the UK and South Africa.
· Based in the UK, Norcros operates under eight brands:
· Triton - Market leader in the manufacture and marketing of showers in the UK
· Merlyn - The UK and Ireland's No.1 supplier of shower enclosures and trays to the residential, commercial and hospitality sectors
· 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 - The leading manufacturer and supplier of ceramic tiles in the UK
· Norcros Adhesives - Manufacturer of tile and stone adhesives, grouts and related products
· Multipanel - Grant Westfield is a leading manufacturer of high-end waterproof bathroom wall panels
· Based in South Africa, Norcros operates under four brands:
· Tile Africa - Chain of retail stores focused on ceramic and porcelain tiles, and associated products such as sanitaryware, showers and adhesives
· Johnson Tiles South Africa - Manufacturer of ceramic and porcelain tiles
· TAL - The leading manufacturer of ceramic and building adhesives
· House of Plumbing - Market leading supplier of specialist plumbing materials
· Norcros is headquartered in Wilmslow, Cheshire and employs around 2,400 people. The Company is listed on the London Stock Exchange. For further information please visit the Company website: http://www.norcros.com