3rd Oct 2013 08:50
LONDON (Alliance News) - Norcros PLC Thursday said it remains confident in its outlook for the full year after predicting that revenues in the first half of the year rose 9.1% to about GBP116 million, from GBP106.3 million a year earlier, buoyed by the recent acquisition of a UK bathroom brassware company.
The maker of taps, showers, tiles and adhesives, with operations in the UK and South Africa and interests in Australia, said revenues were up 15.5% on a constant currency basis during the 26 weeks to the end of September.
However, excluding Vado, its new acquisition, revenue was down 4.7%, a gain of 0.9% at constant currencies.
It said it expects its underlying operating profit, which excludes exceptional items and pension administration costs, to be about GBP6.8 million for the first half, up from GBP6.6 million last year, and underlying pretax profit to be about GBP6 million, flat on last year.
In a trading update, Norcros said UK revenues were up 19.1% thanks to the addition of Vado, but down 5% excluding its new business mainly thanks to a drop in sales of tiles as several large retailers de-stocked. Vado sales were up 14%.
Revenues were up 12.1% in South Africa on a constant currency basis, it added.
"The economic outlook in both South Africa and the UK is more positive in terms of construction activity and housing transactions, albeit this has yet to translate into a significant improvement in consumer confidence," the company said in its statement.
"The destocking seen in Johnson Tiles UK in the first half, together with the second half weighting of cost reduction benefits will mean that group underlying operating profit will be more heavily weighted to the second half than normal," it added.
Norcros expects its net debt to be in the region of GBP29.5 million at the end of the first half, up from GBP19.6 million a year earlier, after a GBP10.6 million net cash outflow due to the acquisition of Vado on March 31.
Norcros shares were down 2% at 20.58 pence Thursday morning.
By Steve McGrath; [email protected]; @stevemcgrath1
Copyright 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
Norcros