Stealing business from Spanish and Italian rivals amid supply fears helped shower, adhesive and tiles supplier Norcros increase sales last year. Both like-for-like revenue and pre-tax profit rose by more than 5 per cent and much of the business has started this year in similar fashion.
Sprucing up the Olympic village, M&S stores and Waitrose supermarkets helped drive like-for-like sales at Johnson Tiles up by almost 9 per cent. The adhesives business also grew sharply, but a poor Christmas held back Triton showers. Still, cost-cutting there meant underlying operating profit and margins improved. New products have been well-received, too. Shedding staff and raising prices also offset rising energy bills and increased profit from UK work by 8 per cent to £12.5m.
True, paying £7.8m to exit a lease in Braintree five years early swelled net debt, but it will save £3.3m in cash each year. And Norcros is selling 10 acres of unwanted land in Stoke on Trent to Morrison for £2.6m, subject to planning. The green light there will open up 20 acres over two other sites nearby. Meanwhile, in South Africa, sales jumped nearly 10 per cent in constant currency, but well-flagged manufacturing issues contributed to a £0.5m underlying loss.
Numis Securities expects current-year adjusted pre-tax profit of £11.7m and EPS of 1.9p (from £10.7m and 1.8p last year).
NORCROS (NXR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 12p | MARKET VALUE: | £69.6m | |
| TOUCH: | 11.75-12p | 12-MONTH HIGH: | 15p | LOW: 9.25p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 8 | |
| NET ASSET VALUE: | 12p* | NET DEBT: | 26% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 168 | 9.90 | 7.90 | 3.22 |
| 2009 | 154 | -4.80 | -4.20 | nil |
| 2010 | 170 | -10.0 | -3.4 | nil |
| 2011 | 196 | 7.50 | 1.20 | 0.36 |
| 2012 | 200 | 9.40 | 1.60 | 0.42 |
| % change | +2 | +25 | +33 | +17 |
Ex-div: 27 Jun Payment: 31 Jul *Includes intangibles of £23.4m, or 4p a share | ||||
