REG - Norcros PLC - Trading Update

NorcrosAnnouncement

13/10/2022 07:01

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RNS Number : 7004C  Norcros PLC  13 October 2022

 

 

 

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 LFL(1) basis) and 20% higher than the
pre-pandemic comparator of 2019 on a constant currency LFL(1) basis.

 

                          H1 LFL(1) revenue increase/(decrease) on
                          2021                   2019
 UK                       (3%)                   14%
 South Africa             10%                    22%
 South Africa (at CC(2))  10%                    32%
 Group                    1%                     17%
 Group (at CC(2))         1%                     20%

 

In our UK business, LFL(1) 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 LFL(1)
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
(http://www.norcros.com)

 

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