Home consumer products group Norcros Plc (LON:NXR) reported a 19% fall in underlying pre-tax profit for the year to March 31, to £3.4m from £4.2m. However, the company said its recent capital raising and resilient revenue boded well for the future and that it had made an encouraging start to the new financial year. Shares in Norcros - whose operations include Triton Showers, Johnson Tiles and Norcros Adhesives - rose by 3.3% to 7.75p.
Revenue was up 10% to £169.6m from the previous £154.2m, benefiting from the relative strength of the South African rand and Australian dollar against sterling. At constant exchange, revenue rose by 2.4%, which Norcros said reflected growth across all of its UK businesses partly offset by declines in both its overseas operations, which include South Africa, Australia and Greece. Group trading profits of £7.3m were 4.3% higher but the increase was more than offset by higher net finance costs, up from £3.9m to £5.3m. Bank refinancing was completed in July 2009 and a capital raising of £27.7m net in December used to pay down expensive debt. Basic losses per share before exceptional items were 0.6p, against 2009 earnings of 1.0p. No dividend was proposed.
Chairman John Brown said the group had a strong balance sheet following its recent capital raising and resilient revenue, driven by essential repair and maintenance activity and continued investment in new product development. Last year's major operational improvements in the South African operations should also yield benefits in the current year. An encouraging start had been made to the current financial year. Ahead of the retirement of CEO Joe Matthews in April 2011, group finance director Nick Kelsall has been appointed chief executive-designate.
© 2010 Stockopedia Limited and BFNNews.com. All rights reserved
