10th Apr 2014 10:53
LONDON (Alliance News) - Shares in Norcros PLC rose Thursday morning, after the group said that it ended the financial year in line with market expectations, with an increase in both revenues and profits.
In a post-close trading update, the supplier of branded showers, taps, bathroom accessories, tiles and adhesives said that revenue growth improved in both UK and South Africa in the last eight weeks of the year.
As a result, it said that group revenue for the year ended March 31, it now expected to be in the region of GBP229 million, up from GBP210.7 million in revenues reported a year earlier. The figure would mark a 16% increase on a constant currency basis on the year before, and 8.7% on a reported basis.
The group said that its operating profit before exceptional items, amortisation of intangibles, is expected to be 25% higher than prior year at roughly GBP16.3 million, up from GBP13.0 million, despite a weaker South African Rand which hit profits in its South African business.
Norcros shares were up 9.2% Thursday morning, at 22.00 pence per share.
Norcros said that UK market conditions were mixed during the year, with the trade sector recovery driven by improving new house build and housing transactions, although it said the retail sector only showed signs of improvement in the last quarter.
It said that UK revenue for the full-year was 21% higher on a reported basis, boosted by the acquisition of Vado last year, although on a like-for-like basis excluding Vado, UK revenue was 3.1% lower than last year, as good progress in Triton Showers and Norcros Adhesives was offset by lower revenue at Johnson Tiles.
Last month the group entered into a conditional agreement to sell its subsidiary Norcros Industry Pty Ltd, which owns its Australian tiles business Johnson Tiles, to Malaysian company Kim Hin Industries Berhad for AUD7.55 million, a deal that will leave it focused on the UK, Africa and the Middle East.
It said the disposal, which is conditional upon Kim Hin Industries Berhad gaining shareholder approval for the transaction, will generate a non-cash loss of approximately GBP1.6 million.
"The board remains confident that the group should continue to make progress in line with market expectations for the year to March 31, 2015.
Norcros said it will release its full-year results on June 19.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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