TIDMNXR
RNS Number : 3346I
Norcros PLC
14 April 2022
14 April 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 preliminary results for the year ended
31 March 2022(1) on 9 June 2022. In advance of this, the Group is
providing the following trading update.
Full year trading performance ahead of expectations
The Group has continued to trade robustly, acting decisively to
counter unprecedented cost inflation and navigate exceptional
supply chain challenges. The Board now expects underlying operating
profit for the year to 31 March 2022(1) to be at a record level and
ahead of its previous expectations.
Group revenue for the year ended 31 March 2022(1) is expected to
be in the region of GBP396 million (2021: GBP324.2 million, 2020:
GBP342.0 million), 22.2% above prior year on a reported basis and
20.6% above on a constant currency basis.
Against a pre-pandemic FY20 comparator, this represents a 15.8%
increase on FY20 on a reported basis, 18.6% above on a constant
currency basis and 20.8% above on a constant currency LFL (3)
basis.
Revenue increase on Revenue increase on FY20
prior year
Reported Reported LFL(3)
H1 H2 FY FY H1 H2 FY
------- ------- ------ --------- ------ ------ ------
UK 39.6% (0.4%) 16.6% 13.9% 17.5% 14.8% 16.1%
------- ------- ------ --------- ------ ------ ------
South Africa 68.5% 11.1% 34.0% 19.6% 10.9% 35.9% 21.9%
------- ------- ------ --------- ------ ------ ------
South Africa
at CC(2) 52.4% 11.1% 28.6% 28.1% 20.0% 43.8% 30.5%
------- ------- ------ --------- ------ ------ ------
Group 48.5% 3.4% 22.2% 15.8% 15.1% 21.5% 18.1%
------- ------- ------ --------- ------ ------ ------
Group at CC(2) 43.8% 3.4% 20.6% 18.6% 18.4% 23.6% 20.8%
------- ------- ------ --------- ------ ------ ------
Our UK business has continued to perform strongly with revenue
at 16.6% above prior year and 16.1% above FY20 on a like for like
"LFL (3) " basis, benefitting from the breadth of its distribution
channels, stock availability and market leading service levels.
Our South African business also continued to perform robustly,
reflecting its leading market positions, stock availability and
enhanced product offer resulting in increasing share gains in the
second half. Revenue for the year was 28.6% higher than prior year
and 30.5% higher than FY20 on a constant currency LFL (3)
basis.
Financial position
The Group remains in a strong financial position and has
invested in inventory in the period to optimise our service and
stock availability proposition in the light of exceptional supply
chain challenges. Net cash (on a pre-IFRS 16 basis) at 31 March
2022(1) is expected to be circa GBP7 million (2021: net cash of
GBP10.5 million, 2020: net debt of GBP36.4 million).
Refinancing of banking facilities
The Group is pleased to announce that it has agreed a new,
GBP130 million multicurrency revolving credit facility ("RCF") with
four lenders. The facility is for an initial three year and seven
month term, with two further years as extension options, and
includes the option for an uncommitted accordion facility of GBP70
million.
Triennial pension scheme valuation
The Group has reached agreement recently with the Trustee on the
2021 triennial actuarial valuation for the UK defined benefit
scheme and on a new deficit recovery plan. The actuarial deficit at
31 March 2021 was GBP35.8m (2018: GBP49.3m). Deficit repair
contributions have been agreed at GBP3.8m per annum from 1 April
2022 to March 2027 (increasing with CPI, capped at 5%, each
year).
Groundwell - exit from last onerous property lease
The Group has also reached agreement with the landlord to exit
early the only remaining surplus and legacy onerous property lease
at Groundwell, Swindon which was expiring on 23 June 2022. A cash
settlement payment of GBP1.3 million including dilapidation
obligations was made in the period. Annualised holding costs were
previously GBP0.6m.
Notice of results
The Group will announce its full year results for the year ended
31 March 2022 (1) on Thursday 9 June 2022.
Nick Kelsall, Chief Executive Officer, said:
" Norcros has continued to build on last year's strong recovery
from the unprecedented global disruption and uncertainty caused by
the pandemic. It is particularly pleasing to see how well our
businesses both in the UK and South Africa have continued to make
strong progress notwithstanding the supply chain challenges and a
period of exceptional cost inflation.
Whilst market conditions are likely to remain uncertain,
exacerbated by the situation in Ukraine, the Board believes that
the Group's highly experienced management teams, leading brands,
proven business model, and leading customer service proposition
will continue to drive outperformance leading to further progress
in the year ahead."
(1.) The accounting reference 'year to 31 March 2022' relates to
the 52-week accounting period commencing on 5 April 2021 and ending
3 April 2022
(2.) CC refers to constant currency basis
(3.) LFL adjusts 2020 revenue from a 53 to a 52 week period
pro-rating and H1 2020 revenue from a 27 week to a 26 week pro
rating
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 seven 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
-- 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 2,200 people. The Company is listed on the London Stock
Exchange. For further information please visit the Company website:
http://www.norcros.com
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